Canadian mining company criticizes lack of foresight in the ruling that cancels its operation in Panama

The Canadian First Quantum Minerals (FQM), parent company of Minera Panamá, the concessionaire of the largest open pit copper mine in Central America, criticized this Wednesday the court ruling that cancels this exploitation because “does not consider the catastrophic financial, social and environmental damage” which, he assures, will cause for the country.

The Supreme Court of Justice declared unconstitutional the law contract that renewed the concession for the exploitation of the mine for 20 renewable years. Panama Copperoperated by Mining Panamain a ruling – issued on Monday and released on Tuesday – that indicated that this agreement approved on October 20 by the Government and Parliament violated 25 articles of the country’s Constitution.

The Panamanian president, Laurentino Cortizo, announced on Tuesday that once the court ruling is formally received, the Government will begin the transition process for the closure of the mine.

“The Court’s decision expresses the unconstitutionality of Law 406 but does not consider the catastrophic financial, social and environmental damage that this will cause.“, said First Quantum in a statement, in which he stated that “Cobre Panama invested US$ 10,000 million in the country in good faith”.

The Cobre Panamá mine began exporting mineral in 2019, especially to the Asian market. It is an operation that represents 4.8% of Panama’s GDP and 75% of the country’s exports, according to company data.

The ruling of the highest courtdoes not take into account a planned closure scenario, in which rehabilitation measures would normally begin to be implemented at least five to ten years before final closure“, a stage that “would involve the development of infrastructure designed to continue managing the environmental aspects of the area and thus avoid a disaster”.

“To ensure environmental protection against unplanned closure, similar schedules and actions must be considered with environmental, economic, labor, social and legal considerations.“said the Canadian miner.

Environmental groups that have been fighting against the mine for more than a decade claim that it is located in the Mesoamerican Biological Corridor, where it has caused serious damage to the ecosystem, an issue that the company has always denied.

Both the Supreme Court ruling and the president’s comments Cortizo They also do not take into accountthe rights of thousands of Panamanians who depend on the Cobre Panamá mine and mining for their livelihood“, since the exploitation has “more than 7,000 direct employees” and employs “33,000 contractors and suppliers“added the company in its statement.

First Quantum assured that “Although the President (Cortizo) announced the suspension of Cobre Panamá operations, the company remains open to constructive dialogue”.

However, “Cobre Panamá reserves all legal rights to protect its investment, prioritizes the safety and well-being of its employees and remains open to constructive and transparent dialogue.“, indicated the statement from the Canadian mining company.

First Quantum warned this Tuesday that it had been forced to suspend “commercial operations” in the mine Panama Copper and that applied “a safety preservation and maintenance program” due to protests against the enclave, which included the naval blockade of its port.

The actions of First Quantum on the Toronto Stock Exchange, where they closed this Wednesday at US$11.36, have plummeted in the last month, when massive protests against the mine took place in Panama, which left four dead and economic losses for the country estimated at US$1.7 billion. .

The rating agency Moody’s said this Wednesday that the cancellation in Panama of the Panama Copper contract “makes it very likely” that the Central American country does not meet the deficit objective this year and in 2024 and that the GDP growth perspective is affected.