Canadian miner Teck Resources has executed a $4-billion sustainability-linked credit facility, under which the price the company pays will increase or decreased based on its performance in reducing carbon emissions, improving health and safety and strengthening gender diversity in its workforce.
“This sustainability-linked facility more fully integrates our performance against our sustainability goals with our financing plan,” president and CEO Don Lindsay said on Tuesday.
The new credit facility matures in October 2026, extending the previous facility by two years. The principal amount outstanding as of October 18 was $198-million, compared with $502-million as of June 30, 2021, and it is expected to be at zero by end of October 2021.
The sustainability-linked revolving credit facility is aligned with Teck’s long-term sustainability strategy, which sets out goals including reducing carbon intensity by 33% by 2030 and becoming carbon neutral across operations by 2050.
In addition to converting and extending its $4-billion revolving credit facility, Teck has also cancelled its $1-billion side car that was scheduled to mature in June 2022. This side car facility was established during the initial months of Covid-19, and market conditions and commodity prices have improved significantly since that time.