Tonnage based electrical coal royalty with no commodity price exposure
|2021 Royalty Revenue||C$8.5 million|
|Annual Production Capacity||5.09 million tonnes of thermal coal|
|Estimated Decommissioning Year||2023|
The Genesee Mine is located approximately 70 km southwest of Edmonton, Alberta. The open pit operation has been in operation since 1989 and has an annual production capacity of 5.6 million tonnes. Its coal is delivered to the Genesee power station which is adjacent to the mine. The power station is operated by Capital Power Corporation and is comprised of three power generation units with total capacity of 1,376 MW. Generating Unit 1 began operating in 1994, Unit 2 in 1989 and Unit 3 in 2005.
The power generation units at Genesee were originally expected to be decommissioned in 2039, 2044 and 2055 respectively. However, the government in 2015 mandated a shut down of coal-fired electricity generation by 2030. As a result, Capital Power initially announced plans to convert Units 1 and 2 to combined cycle gas generation, whereas Unit 3 was to be the only one with dual fuel generation capability. In December 2020, Capital Power announced that dual-fuel upgrades will continue at Unit 3 and Genesee will be fueled entirely by natural gas as early as 2023.
Altius commenced legal action against the federal and provincial governments in 2018, arguing that the action taken by the governments in 2015 was tantamount to expropriation. This action is ongoing in 2020, with a hearing taking place in mid-December (see [link to coal 2030 section of website] The 2019 and historical revenue reported for Genesee represented the JV interest that Altius held (52.4%) with partner Liberty Metals & Mining Holdings, LLC (LMM). In July 2020, Altius announced the acquisition of LMM's interest, increasing Altius's portion to 97.3% going forward. The acquisition has no impact on the ongoing legal action.