The largest copper mine in Central America, roots of a conflict

The Supreme Court of Panama declared this Tuesday “unconstitutional” a mining contract, an expected ruling after more than a month of social tension with marches, road blockades, million-dollar losses in the economy and outbreaks of violence.

These are the main dates of the crisis around the largest open pit copper mine in Central America, operated by the Canadian company First Quantum Minerals (FQM), which unleashed the largest protests since the fall of dictator Manuel Noriega in 1989:

1997

The Panamanian State signs a contract with the mining company Petaquilla SA, which receives a concession of 12,955 hectares in Donoso, Caribbean province of Colón, for 20 years.

2008

The Environmental Advocacy Center (CIAM), supported by other environmental organizations, filed a lawsuit against the contract, arguing that the concession was given without public bidding, without consultation with the communities and without a true environmental impact study.

2014

Petaquilla Minerals sells the mine to Minera Panamá, a subsidiary of FQM.

2017

The government granted an extension to Minera Panamá to continue the operation for another 20 years. The Supreme Court declared the 1997 contract “unconstitutional,” but the mine did not cease operations due to a series of allegations and interpretations by authorities and the mining company.

2019

The Canadian company begins the export of the mineral. It produces about 300,000 tons of copper concentrate per year, which represents the 75% of Panamanian exports.

2021

Four years after the Court’s resolution, the ruling is finally published in the Official Gazette. Under the presidency of Laurentino Cortizo, the government and the mining company begin negotiating a new contract.

2022

The negotiation concludes, but in the drafting of the text there were disagreements that were on the verge of collapsing the process.

2023

• August: The government and the mining company finally sign the contract that establishes minimum annual contributions from the mining company to the State for US$375 million, ten times more than the amount of the initial agreement.
• October 20: Congress approves the law that seals the new contract and Cortizo promulgates it, unleashing massive protests by environmentalists, teachers, workers and other unions.
• November 3: Faced with popular pressure, the government and deputies approve an indefinite moratorium on metal mining and leave it to the Supreme Court to resolve a series of unconstitutionality claims that will define the future of the mine.
• November 7: A 77-year-old man, with Panamanian and American nationality, shoots and kills two protesters who were participating in blocking a route.
• November 16: FQM pays US$567 million in royalties and taxes, but they are frozen pending the Court’s ruling.
• November 23. The business leadership criticizes the “inaction” de Cortizo in the face of road blockades, which have caused losses of US$ 1.7 billion, according to his estimate.
• November 24: The Supreme Court begins “permanent session” to resolve the controversy over the mining contract.
• November 26: The government says it is prepared “to defend” to the country, after being notified by FQM of its intention to go to international arbitration if the contract is declared unconstitutional.
• November 28: The Court decides that the contract is “unconstitutional”. Protesters celebrate outside the court and blockades on some routes begin to be lifted.