February 17, 2010 / 2:13 PM / in 8 years

UPDATE 2-Teck may have to curtail Red Dog zinc operations

* Environmental groups appeal against EPA permit

* Permit is suspended until EPA issues notice

* If delays extend past May, operations will be affected (Adds details, share price move)

TORONTO, Feb 17 (Reuters) - Teck Resources Ltd TCKb.TO said on Wednesday it may be forced to curtail operations at Alaska’s Red Dog mine, the world’s largest zinc mine, after environmental groups appealed against a permit issued by the U.S. Environmental Protection Agency.

Several environmental and tribal groups have appealed against the renewed National Pollution Discharge Elimination System (NPDES) permit, which was due to come into effect on March 1.

Teck said that until the EPA issues a notice clarifying which provisions of the permit are subject to appeal, the entire permit has been suspended.

The Vancouver-based miner said that until the EPA issues the notice, it will not know whether, and to what extent, access to Aqqaluk -- the next deposit to be mined at Red Dog -- will be affected.

Last month, native and environmental groups in Alaska appealed the state’s certification of a water permit needed for a planned expansion of the Red Dog mine. Teck said the latest appeal was filed by the same groups. [ID:nN15228005]

Red Dog’s main reserves are expected to be depleted in 2011, at which point Aqqaluk should already be up and running.

Teck’s plan is to operate the main deposit at Red Dog under existing permits until 2011, but to maintain efficient production rates, ore from the main deposit would need to be supplemented by ore from Aqqaluk.

If permit delays extend beyond May 2010, the transition plan will be affected and production at Red Dog will likely be curtailed in October, Teck said in a statement.

Production would not be expected to resume until the appeal is resolved and the mine can be restarted, which could take up 18 months unless the appeal is withdrawn.

Teck shares were up 72 Canadian cents at C$39.76 in early trading on the Toronto Stock Exchange on Wednesday

$1=$1.04 Canadian Reporting by Euan Rocha; editing by Peter Galloway

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