Canadian mining company Cominco has curtailed its zinc mining operations in British Columbia, Canada in order to sell some of the power generated at its Waneta dam to the power-starved US market in California.
The California power crisis and surging electricity prices in the spot market is expected to increase Cominco’s post-tax earnings for December and January by an estimated C$45M (US$30M). Cominco has signed a power swap agreement with a major US energy company, and has decided to cut its zinc production to free up more power for the deal. Cominco has been selling excess power in the US market since spring.
In the meantime spot power rates in the Pacific Northwest have soared to an average price of about US$500-600 per MWh, compared with normal rates which are between US$25-35 per MWh.