• Sign up for the Daily Digest E-mail
  • Facebook
  • X
  • LinkedIn

BOE Report

Sign up
  • Home
  • StackDX Intel
  • Headlines
    • Latest Headlines
    • Featured Companies
    • Columns
    • Discussions
  • Well Activity
    • Well Licences
    • Well Activity Map
  • Property Listings
  • Land Sales
  • M&A Activity
    • M&A Database
    • AER Transfers
  • Markets
  • Rig Counts/Data
    • CAOEC Rig Count
    • Baker Hughes Rig Count
    • USA Rig Count
    • Data
      • Canada Oil Market Data
      • Canada NG Market Data
      • USA Market Data
      • Data Downloads
  • Jobs

Report: Teck Resources, a Major Canadian Oil Sands Promoter, Faces Difficulties

April 20, 201510:50 AM CNW

In Fort Hills and Frontier Projects, Canadian Company Is Losing Its ‘Overly Optimistic’ Bet on An Expensive Source of Energy

CLEVELAND, April 20, 2015 /CNW/ – (IEEFA.org) — The Institute for Energy Economics and Financial Analysis released a report today questioning the financial viability of Teck Resources, a Canadian energy company with a substantial stake in the flagging oil sands development of Alberta.

The report, titled “Teck Resources: Tough Road on Oil Sands Investments,” analyzes finances from 2011-2014 and incorporates additional data from other oil sands developers.

Teck, which is based in Vancouver, B.C. and has roots that go back to the early 1900s, has struggled with two oil sands efforts in particular:

  • Its Fort Hills project, in which the company has a 20 percent interest and in which it has made a capital commitment of $2.9 billion through 2017.
  • Its proposed Frontier oil sands project, which does not appear to be viable in either the medium or long term.

“There may be no better example of Canada’s deeply afflicted oil sands industry than Teck Resources, the long-established mining company that is on hard times today in part for its overly optimistic expectations regarding its venture in oil sands, an expensive source of energy,” Tom Sanzillo, the lead author on the report and the director of finance for IEEFA wrote in a commentary accompanying the report.

“While oil sands projects are a small part of Teck’s overall portfolio, they absorb a large and growing portion of the company’s shrinking resources,” Sanzillo said.

The report notes also that numerous oil sands projects by other companies have been delayed recently in the face of low oil prices and difficult market conditions.

It details Teck numbers that show Teck’s net income in 2014 plunging to $330 million, down from $951 million in 2013 and $1.145 billion in 2012; a drop in free cash flow $207 million in 2014 from $1.2 billion in 2012, a trend that suggests the company will report a negative free cash flow in 2015; deteriorating in gross profits from to $1.3 billion in 2014 from $3.5 billion in 2012; a drop in operating income to $905 million in 2014 from $3.2 billion in 2012. The report notes, too, that Teck’s stock has lost roughly 78 percent of its value since 2011.
The report raises pointed questions for investors around whether the company’s oil sands venture make financial sense and to what extent the work puts the company at risk.

Sanzillo said, “These are tough questions, to be sure, and our report suggests some tough answers.”

A full copy of the report is available here.

About IEEFA
The Institute for Energy Economics and Financial Analysis (IEEFA) conducts research and analyses on financial and economic issues related to energy and the environment. The Institute’s mission is to accelerate the transition to a diverse, sustainable and profitable energy economy.

SOURCE The Institute for Energy Economics and Financial Analysis

For further information: Media contact: Karl Cates, kcates@ieefa.org, 917.439.8225

Canadian Oil Sands

Follow BOE Report
  • Facebook
  • X
  • LinkedIn

Sign up for the BOE Report Daily Digest E-mail

Successfully subscribed

Latest Headlines
  • Venture Global cashes in on exports from Plaquemines LNG plant, SEC filing shows
  • Journey Energy Inc. Provides Encouraging Results from Its First Three 2025 Duvernay Wells
  • US proposes rules that could boost oil, gas output in US West
  • Ontario Premier Doug Ford pitches railway to Ring of Fire, Alberta is on board
  • Alberta to hold nuclear power consultations as reactor companies weigh opportunities

Return to Home
Alberta GasMonthly Avg.
CAD/GJ
Market Data by TradingView

    Report Error







    Note: The page you are currently on will be sent with your report. If this report is about a different page, please specify.

    About
    • About BOEReport.com
    • In the News
    • Terms of Use
    • Privacy Policy
    • Editorial Policy
    Resources
    • Widgets
    • Notifications
    • Daily Digest E-mail
    Get In Touch
    • Advertise
    • Post a Job
    • Contact
    • Report Error
    BOE Network
    © 2025 Stack Technologies Ltd.