Teck Cominco Announces Acquisition of 15% Interest in Fort Hills Oil Sands Project

TeckCominco News Release
06-Sep-2005

Vancouver, B.C. -- Teck Cominco Limited today announced that it has entered into an agreement with UTS Energy Corporation and Petro-Canada to subscribe for a 15% interest in the Fort Hills Energy Limited Partnership (the “Partnership”), which is developing the Fort Hills oil sands project in Alberta, Canada.

The aggregate subscription price is $475 million. Teck Cominco will earn a 10% interest in the Partnership by funding $250 million of Petro-Canada and UTS expenditures. In a separate transaction, Teck Cominco will earn a further 5% interest from UTS by funding an additional $225 million of UTS expenditures. On closing of the transactions, expected to occur in October, Teck Cominco will be issued a 15% interest and the interests of UTS and Petro-Canada in the Partnership will be adjusted to 30% and 55%, respectively. The subscription price will be satisfied by Teck Cominco contributing 34% of project expenditures until project spending reaches $2.5 billion and its 15% share thereafter. Closing of the transactions is subject to due diligence, definitive documentation and receipt of regulatory approvals.

Teck Cominco President and CEO Don Lindsay said: “Fort Hills is an ideal opportunity to further diversify our production base in a commodity which will be increasingly important in a world concerned about security of energy supply, and in which Canadians can be expected to play a major role. It is consistent with our strategy of emphasizing the development of quality, long life assets in a variety of significant products in favourable jurisdictions.

Teck Cominco’s proven open pit mining expertise should make a significant contribution to the success of Fort Hills, which will involve mining and extraction as well as upgrading to a final petroleum product. We look forward to working with UTS and project operator Petro-Canada to add value to this project, and view this transaction as the foundation for potential further opportunities in the oil sands business.”

Fort Hills, located approximately 90 kilometres north of Fort McMurray, is a long-life asset with 2.8 billion barrels of bitumen resource. Regulatory approvals are in place for up to 190,000 barrels per day of bitumen production, with initial start-up by the end of the decade. Plans include an integrated upgrader. The project partners are currently evaluating the best location for the upgrader and the technology to be employed.

In a separate transaction, UTS has agreed in principle to grant to Teck Cominco the right to acquire at fair market value a 50% working interest in “Lease 14”, an oil sands property contiguous to the Fort Hills property. The option would be exercisable following delineation by

UTS of the resource on Lease 14 in the event that UTS determines that Lease 14 should be developed as a satellite mine to Fort Hills, subject to agreement of the Partnership.

Teck Cominco will host a conference call to discuss this news release. The call will take place on Tuesday, September 6, 2005 at 5:30 a.m. (PDT) / 8:30 a.m. ( EDT). The dial-in phone number is 416-231-6596, toll-free at 866-250-4910. To access a recording of the call at a later time, dial 1-416-640-1917 and enter code 21151341#. The recording will be available until November 7, 2005.

A live audio webcast of the conference call, together with supporting presentation slides, will be available at Teck Cominco's website at www.teckcominco.com. The webcast will also be available at www.Q1234.com and www.newswire.ca. The webcast will also be archived at www.teckcominco.com.

Teck Cominco is a diversified mining company, headquartered in Vancouver, Canada with assets of over $6 billion. Shares are listed on the Toronto Stock Exchange under the symbols TEK.MV.A and TEK.SV.B. The company is a world leader in the production of zinc and metallurgical coal and is also a major producer of copper and gold. Further information can be found at www.teckcominco.com.

The slideshow presentation is at www.teckcominco.com