Tausi Insider

First Quantum Minerals Ltd. FM-T has failed to reach an agreement with the Panamanian government over a new royalty payment structure, and now there are fears its massive copper mine in the country could be nationalized. Vancouver-based First Quantum faced a deadline of midnight yesterday to get a new royalty agreement in place with Panama regarding the Cobre Panama mine. If an agreement wasn’t reached by that time, the Panama government said it would take “alternative measures” to ensure the operation of the mine. In a statement, the Ministry of Commerce and Industries of Panama, said that First Quantum had made “unreasonable demands” that often moved the two sides further apart instead of closer together. The Ministry said it negotiated in good faith past the deadline last night, but early this morning First Quantum sent it a new proposal that “fundamentally changed” certain aspects of the agreement. First Quantum said in a release that its proposal achieved the government’s revenu...

Heavy equipment prepares a road at Inmet’s massive Cobre Panama project. Panama has ordered First Quantum Minerals Ltd.’s FM-T Cobre Panama mine to cease commercial operations, after the Central American country clashed with the big Canadian copper miner over a profit-sharing agreement. Panama’s President Laurentino Cortizo made the announcement late Thursday in a dramatic televised address to the nation. Cobre Panama is First Quantum’s biggest mine, and accounts for more than half of its net asset value. Vancouver-based First Quantum is Canada’s biggest copper producer. First Quantum and Panama had been in talks for more than a year to try to hammer out a new profit-sharing agreement to replace the existing pact that sees the company pay a royalty based on a percentage of its revenue. First Quantum faced a deadline of midnight Wednesday to strike a new pact, but on Thursday morning the two sides announced they were at an impasse. Panama had wanted First Quantum to pay a minimum of U...

First Quantum Minerals Ltd. FM-T says it will use “all available legal means” to preserve the value of its Cobre Panama mine, after the Panamanian government ordered it to cease operations, and as fears persist that the asset could be either nationalized or sold to another mining company. A source familiar with the negotiations said that Panama has been working with an investment bank to shop the mine to third parties. Tausi Insider is not identifying the source as the person was not authorized to speak publicly. The government of Panama did not immediately respond to a request for comment. In a dramatic televised address to the nation on Thursday night, President Laurentino Cortizo said that production would be halted at the mine after the Central American country clashed with the big Canadian copper miner over a profit-sharing agreement. First Quantum and Panama had been in talks for more than a year to try to hammer out a new profit-sharing agreement to replace the existing pact t...

Canada’s trade minister has been in contact with her counterpart in Panama in an effort to resolve a dispute over future payments First Quantum Minerals Ltd. FM-T must make to operate its flagship copper mine in the country, a government source said on Friday. After efforts to reach a deal failed, Panama on Dec. 15 said First Quantum must shut down its Cobre Panama mine. “Obviously, we have a keen interest in seeing resolution to this, and are optimistic that both parties are negotiating in good faith,” said the source, who is familiar with the discussions. Canada’s Trade Minister Mary Ng spoke with Panama’s Commerce and Industries Minister Federico Alfaro about a week ago, the source said, and they have remained in contact by chat since then. “We have also heard from (the company) to ensure that Minister Ng and our team stays engaged in keeping this on the front burner,” said the source, who was not authorized to speak on the record. The Cobre Panama mine is considered the largest p...

A general view of Cobre Panama mine owned by First Quantum Minerals in Donoso, Panama, December 6, 2022. STRINGER/Reuters Canada-based miner First Quantum Minerals Ltd and its subsidiary Minera Panama started arbitration processes against Panama, the country’s ministry of commerce and industry said on Saturday, as the two sides have been locked in a disagreement over payments and mine operations. Panama’s government on Monday ordered First Quantum to pause operations at its flagship Cobre Panama copper mine after the company missed a deadline to finalize a deal that would have increased payments to the government by at least US$375-million. Despite having agreed to meet with the government, the company decided on Friday to “advance efforts” by going ahead with two arbitration processes, the ministry said in a statement, without giving further details. An official from the country’s economy and finance ministry told Reuters on Friday that Panama was looking for a “fair” deal in which ...

The Chief Executive Officer of Canadian miner First Quantum Minerals FM-T met Panama’s commerce and industry minister on Monday to discuss disagreements over the firm’s copper operations in the country, a person familiar with the matter said. First Quantum CEO Tristan Pascall flew to Panama over Christmas to attend the meeting in person with the minister, Federico Alfaro, according to the source, who said further talks are planned. The commerce and industry ministry did not immediately reply to a request for comment. A spokesperson for First Quantum declined to comment. The government and the mining company have been discussing a deal that would have increased annual tax payments to Panama to at least $375 million. The Panamanian government ordered the firm to halt operations at the Cobre Panama mine after they both missed a deadline to reach an agreement. The firm started arbitration proceedings against the government days after, according to local authorities. A government official...

Canada-based miner First Quantum Minerals Ltd. FM-T would suspend a “significant amount” of jobs at its operations in Panama if the Central American government forces it to halt operations during a contract dispute, the company said in a letter. “If we have to reduce operations to care and maintenance mode, the company will need to take steps to reduce expenditure across the business. We could be forced to suspend a significant amount of our valued workforce,” the letter sent to employees and seen by Reuters said. The company’s Cobre Panama mine generates about 40,000 direct and indirect jobs and interacts with some 1,800 suppliers, according to a consultant. First Quantum was notified on Dec. 21 of a government order for it to create a plan to halt operations within 10 working days, after it missed a deadline for a new contract due to disagreements centered on royalties and tax payments. “This is a drastic and, in our view, unnecessary step, which will potentially have a huge impact...

The Cobre Panama copper mine in Donoso, Panama. Abraham Teran/The Associated Press Panama says it has no intention of seizing the Cobre Panama mine from First Quantum Minerals Ltd., FM-T despite excoriating the Canadian copper company for allegedly misrepresenting the tenor of their talks. Vancouver-based First Quantum and Panama have toiled for more than a year to try to come up with a new tax and royalties contract for the mine. Talks broke down last month, at which point Panamanian President Laurentino Cortizo ordered the mine to cease operations. Other Canadian miners have seen their assets expropriated after clashing with foreign governments, including Centerra Gold Inc. in 2021. Its flagship Kumtor mine was nationalized by the Kyrgyz Republic. But there appears to be almost no chance of that happening in this case. “At no point has the government considered, or will it consider, expropriating any mine,” Federico Alfaro, Panama’s Minister of Commerce and Industries, said in an i...