TSX- and NYSE-listed diversified miner Teck Resources on Friday announced the closing of the sale of its two-thirds interest in the Waneta dam, in British Columbia, to BC Hydro for $1.2-billion.
The transaction has received the necessary regulatory approvals and consents, including approval by the British Columbia Utilities Commission.
Teck will record an after-tax gain of about $820-million as a result of the sale, with no cash tax payable on the proceeds.
As part of the sale, Teck Metals holds a 20-year lease to use the two-thirds interest in Waneta to produce power for its industrial operations in Trail.
Yearly payments will begin at about $75-million and escalate at 2% a year, equivalent to an initial power price of $40/MWh, based on 1 880 GWh/y of energy.
Teck Metals has an option to extend the lease for a further ten years at comparable rates.