BC Hydro statement regarding Teck Resources intent to sell its share of Waneta Dam
BC Hydro has been informed by Teck Resources (Teck) that it has reached an agreement to sell its two-thirds share of the Waneta Dam to Fortis Inc. The transaction includes a lease agreement where the two-thirds share would continue to supply power to Teck's smelter in Trail, B.C. at a fixed price. BC Hydro owns the other one-third share of the Dam. Under its Co-Ownership and Operating Agreement (COA) with Teck Resources, BC Hydro has the right of first offer enabling it to match Fortis's offer and purchase the two-thirds share of the Waneta Dam under the equivalent terms.
As per the COA, upon receipt of a sale notice BC Hydro has 60 days to review the transaction and make a decision. BC Hydro will carefully evaluate the terms of this opportunity to determine if it is in the best interest of our customers. A decision to move forward would be subject to approval by the BC Utilities Commission and a transaction would need to be completed within 12 months of our decision.
Over the past year, Teck Resources kept BC Hydro informed, under a strict non-disclosure agreement, of its interest in selling its two-thirds share of the Waneta Dam. BC Hydro has assessed its interest at every stage in accordance to its rights under the COA.
Background on Waneta Dam
- The Waneta Dam is located close to the Canada-US border, near the mouth of the Pend d'Oreille River just before it enters the Columbia River, near Trail, B.C.
- The dam was originally constructed in 1954 by the Consolidated Mining and Smelting Company of Canada Limited (now known as Teck Resources) to generate power specifically for use at its smelter located in Trail, B.C.
- Its four generating units total 490 megawatts of capacity and produce approximately 2,800 gigawatt hours of energy per year.
- In 2010, BC Hydro purchased a one-third share of the Waneta Dam for $825 million. Teck Resources owns the other two-thirds.
- The BC Utilities Commission found that the BC Hydro purchase of one-third interest in the Waneta Dam was is in the public interest. This decision was based on a review of cost effectiveness, due diligence and local impact.
- BC Hydro's one-third is supplied to BC Hydro customers and Teck's two-thirds is supplied to the Teck smelter in Trail. Under the terms of the current transaction two-thirds of the generation will continue to supply electricity to Teck's smelter in Trail during the lease period.
- FortisBC currently operates and maintains Waneta Dam and the Waneta Expansion.
BC Hydro Media Relations
p. 604 928 6468