Last week, Teck Resources Ltd. (TSX: TCK.B) announced its Q2/09 results and reported net earning reached $570 million, compared to $497 million, one year earlier. We have also made substantial progress with our debt reduction plan, Don Lindsay, Tecks president and CEO, said in a statement. The US$5.81 billion bridge loan related to our acquisition of Fordings assets now has been paid in full and the US$4 billion term loan has been reduced to US$2.74 billion. Tecks total debt has been reduced by $4.6 billion since it completed the Fording acquisition in October 2008, and it expects to further reduce its debt by $1 billion after it close the sales of future gold production from out Andacollo mine and the Waneta Dame later this year. During a conference call with analysts on July 23rd, Lindsay said Teck wasnt planning any merger and acquisitions as it has tremendous internal growthwere sort of past the phase of adding resources to the company. He also said Teck had no plans for the significant sale of assets. Lindsay mentioned that Teck was in no rush to sell 20% of its coal assets, Its not something that we need to do from a financial point of view. As for whether theres a rebound in coal sales in Europe and North America, Lindsay said, [Its] moderate, but theres no doubt that Asia is the strength in the market. Theres some interesting signs. Like weve made shipments to a customer who we hadnt for a long time and that sort of thing, but theres not enough to say that theres been a significant uplift. Lindsay said Teck isnt able to meet consumer demand for coal right now and hes been looking into increasing production but you cant ramp-up production as quickly as youd like. He has asked his team to revisit a plan to increase coal production to 30-million-tons by 2014 that was first drawn up between mid-2007 and mid-2008. Lindsays not sure if the plan is still feasible within the same timeframe, but said it was possible to achieve that production level. The plan called for a capital budget of between $400 million and $500 million. But were going to redo all that now just to refresh it, because we do believe that demand will be there. Theres no doubt that the plans for building very large steel to refresh it, because we do believe that the demand will be there. Theres no doubt that the plans for building very large steel plants on the coast of China are continuing and that we will have a significant effect on long-term demand for seaborne met coal.
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