PANAMA CITY -- Shares of Canada’s First Quantum Minerals tumbled on Wednesday after a government-commissioned study in Panama recommended negotiating a new arrangement that could allow a temporary restart of the Cobre Panama mine to facilitate its orderly closure.
“We have to be very, very clear. An operation of this scale is not closed in a year or five,” said Julio Molto, Panama’s Minister of Commerce, who is part of the panel that made the recommendations for reopening the mine.
The study marks another development in the long-running dispute over the mine, which was responsible for 1% of copper production worldwide until the government shuttered it in 2023 following protests from local residents over tax contributions and its environmental impact.
Effectively, the commission recommends “establishing the conditions for a restart that enables achieving an orderly closure at no cost to the nation.”
It also recommends resolving all arbitration claims filed by First Quantum against the government following the mine’s closure.
“Felipe Chapman, Panama’s Finance Minister who also made the recommendations said closing the mine would represent extraordinary financial burden for the Panamanian state and would compromise public resources for years.
Shares of First Quantum Minerals plummeted 31 per cent on the Toronto Stock Exchange following the announcement.
Panama’s President Jose Raul Mulino said at a press conference on Wednesday that he would carefully analyze the contents of the study before making a firm decision on the future of one of the world’s largest open-pit copper deposits.
Reuters reported earlier on Wednesday that the commission would propose a state partnership with Canada’s First Quantum Minerals in order to restart the shuttered mine.
(Reporting by Anthony Esposito, Divya Rajagopal and Elida Moreno; Editing by Emily Green, Emelia Sithole-Matarise and Nick Zieminski)
