Teck Resources warned the Liberal government the company will be hit with an impairment charge of about $1.13 billion if the government doesn’t approve the proposed Frontier oilsands mining project in northern Alberta.
According to Investopedia an impairment charge is a new term used to describe writing off worthless goodwill. In 2002 companies adopted new accounting rules and disclosed huge goodwill write-offs.
If approved, it is estimated that the Frontier project will directly employ up to 7,000 workers during construction and up to 2,500 workers during operation.Frontier project will directly employ up to 7,000 workers during construction and up to 2,500 workers during operation. Click To Tweet
Frontier would have an anticipated 41-year mine life, generating long-term
employment and economic activity. It would be a major economic driver for Northern Alberta.
It is estimated that Frontier will contribute about $55 billion in provincial royalties and taxes and an estimated $12 billion in federal income and capital taxes.
Frontier is a proposed truck-and-shovel oil sands mine between Fort McMurray and Fort Chipewyan in northeast Alberta. The project is advancing through a joint federal-provincial regulatory review process.
Frontier will consist of surface mining operations, a processing plant, tailings management facilities, water management facilities, and associated infrastructure and support facilities. Teck said it is committed to developing Frontier responsibly, incorporating best practices for environmental protection, tailings management, water use and managing greenhouse gases.
Teck reached agreements with all 14 Indigenous communities in the broader Frontier project area.
The federal government is expected to make a decision by the end of February on whether the $20.6-billion project will go ahead. If approved it will produce about 260,000-barrels of bitumen per day, which will be transported via pipeline.
On Friday, Teck said the Frontier project was optimized with improved technology. They said it will be “technically feasible and commercially viable,” even though commodity price projections are lower.
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