General Markets & Customers Results of Operations 6 Shipments by Destination Operating Results 2002 2001 2000 Revenue Coal $109,581 $126,186 $ 116,388 Other income 2,085 879 2,361 111,666 127,065 118,749 Expenses Operating & Administrative 58,312 68,208 65,835 EBITDA 53,354 58,857 52,914 2002 2001 2000 ‘Tonnes %  "Tonnes % Tonnes % Japan 6,896 35.5 7,576 32.5 7,922 35.2 Europe 5,469 28.1 7,087 30.4 5,947 26.4 S. Korea 3,787 19.5 4,684 20.1 4,767 21.2 S. America 2,064 10.6 2,775 11.9 1,997 8.9 Taiwan 809 4.2 979 4.2 1,145 5.4 Other 409 2.1 191 0.9 724 3.2 Total 19,434 100.0 23,292 100.0 22,502 100.0 Westshore operates a coal storage and loading facility at Roberts Bank, British Columbia which is the largest coal loading facility on the west coast of North and South America. Westshore operates on a throughput basis and receives handling charges from its customers based on volumes of coal exported through the terminal. Under Westshore’s contracts, Westshore does not take title to the coal it handles. Market conditions for coal affect the competitiveness of Westshore’s customers and as a result affect the volume of coal handled by Westshore. Westshore handles and loads coal from mines in British Columbia and Alberta and, occasionally, the northwestern United States. Coal shipped from the mines acquired by the Coal Partnership, which is now by far Westshore’s largest customer, accounted for 97% of Westshore’s revenues in 2002. Coal is delivered to the terminal in unit trains operated by Canadian Pacific Railway Company, Canadian National Railways and Burlington Northern Railroad and is then unloaded and either directly transferred onto a ship or stockpiled for future ship loading. Ultimately, the coal is loaded onto ships that are destined for approximately 20 countries world-wide, with the largest volumes presently being shipped to Japan, Europe and South Korea. Shipments of coal through the terminal by destination for the past three years were as follows: (Expressed in thousands of metric tonnes) With its five mines in British Columbia, the Coal Partnership is by far Westshore’s largest customer. ‘These mines shipped 97% of the terminal’s throughput in 2002 as compared to 94% in 2001. There continues to be an increased emphasis on both the quality and blending of coal at the terminal to ensure that the customer receives the contractually specified type of coal. More than two thirds of the coal product moving through the terminal is (Expressed in thousands of dollars) The comparison of Westshore’s operating results for the past three years 1s as follows: Westshore loaded 19.4 million tonnes of coal during 2002 as compared to 23.3 million tonnes during 2001 and 22.5 million tonnes in 2000. The most significant event from Westshore’s point of view is the formation of the Coal Partnership to become the world’s second largest exporter of metallurgical coal. Because of its contractual arrangements with the Coal Partnership, Westshore would benefit from any increased sales which the Coal Partnership is able to realize by virtue of enhanced marketing opportunities. Together the largest Australian producer and the Coal Partnership account for approximately 50% of the world’s seaborne coal trade. There has been significant consolidation among producers of seaborne metallurgical coal. In Canada the Gregg River mine, the Quintette mine and the Smoky River mine all closed, and the Cardinal River Mine and the Bullmoose Mine are scheduled to close in 2003. Of these mines, only the Gregg River Mine shipped coal through Westshore. In part this consolidation resulted from a significant decrease in the US dollar denominated reference price for coal between 1997 and 2000. While the reference price has recovered since 2000, the trend to consolidation has continued. All of Westshore’s customers compete with other suppliers of coal throughout the world. Australia is the most significant competitor. Its closer proximity to primary customers in Asia and its lower dollar in relation to the Canadian dollar, among other reasons, give Australian producers some competitive advantages over Westshore’s customers. now blended. During 2002, 92% of Westshore’s volume was metallurgical coal (88% in 2001), with the remaining 8% being thermal coal (12% in 2001). dfs. Westshore Terminals Ltd. Operational Review