Panama to discuss First Quantum copper mine restart

Panama may open talks early next year with First Quantum Minerals (TSX: FM) on the possible restart of its shuttered Cobre Panamá copper mine. 

Commerce Minister Julio Moltó told local newspaper El Capital Financiero that the government will begin talks with First Quantum once an environmental audit is completed in three to four months. The audit is due to start within weeks, Moltó said. The review, conducted by SGS Panama Control Services, is to assess environmental, social and economic impacts, including employment opportunities for Panamanians.

The mine has been closed since November 2023 after Panama’s Supreme Court declared its operating contract illegal. President José Raúl Mulino has identified the reopening of Cobre Panamá as a top priority for his administration, following reforms to the country’s social security fund pension system. However, Mulino has said the audit must come first before any decision on reopening.

Economic pillar

Before its closure, Cobre Panamá ranked among the world’s largest copper producers, yielding 350,000 tonnes in 2022, its final full year of operations. The mine contributed about 5% of Panama’s GDP, and First Quantum estimates the suspension has cost the country up to $1.7 billion in lost economic activity.

Minera Panamá, First Quantum’s subsidiary, and other companies tied to the project have suspended international arbitration proceedings against the government, clearing the way for talks. Locals around the mine rallied the government in June to reopen operations. 

First Quantum has maintained the facility to ensure it can resume operations if an agreement is reached. A Northern Miner Group visit to the site this year found an otherworldly silence engulfing the idled machinery amid a relentless jungle.