Panama's Mulino Secures Future of Closed Copper Mine

Panama's Closed Copper Mine

Panama's newly inaugurated president, Jose Raul Mulino, has outlined plans to temporarily reopen the country's Canadian-owned copper mine, which ceased operations in November, with the intent to "permanently close it in a definitive, safe, and positive manner." This decision hinges upon the findings of a government-commissioned environmental study of the facility owned by First Quantum Minerals.

Mulino's announcement marks a potential milestone in the shutdown of one of the largest copper mines in the Americas, despite previous statements from First Quantum Minerals expressing interest in reopening discussions with the new government.

"We will collaborate with any incoming administration," stated Robert Harding, Chairman of First Quantum, earlier this year. "Our goal is to see this mine operational again."

The temporary reopening of the $10 billion open-pit mine aims to facilitate the government and the company in managing the facility's maintenance costs and addressing the 120,000 tonnes of copper left on-site when operations ceased, Mulino explained.

First Quantum Minerals has not publicly responded to Mulino's recent statements.

Panama's closure of the mine followed a Supreme Court ruling in November deeming First Quantum's contract unconstitutional. The company is pursuing $20 billion in compensation through international arbitration but expresses a preference for resolving the matter through negotiation with the government.

Under the new government's direction, Panama will conduct "a rigorous environmental audit of the mine to assess the true condition of the site, its surroundings, rivers, fauna, flora, and potential environmental risks, whether the mine remains open or closed," Mulino emphasized.

"The Supreme Court's decision must be honored," President Mulino affirmed. He added, "The dormant mine poses potential environmental hazards that we must preemptively address. Inaction is not a viable option."

According to official data, the mine accounted for approximately 5% of Panama's economy. It produced 331,000 tonnes of copper in the year prior to its closure, constituting 5% less than the total output for 2022, as reported by First Quantum Minerals.