Cobre Panama Withdraws its Arbitration Claims Against the Panamanian State
The arbitration situation was one of the conditions the Panamanian government had set for entering into the mine’s issue and defining its future.
First Quantum Minerals announced that it has withdrawn its arbitration proceedings against the Panamanian government before the International Chamber of Commerce (ICC). “First Quantum Minerals Ltd. reports that, following discussions with legal representatives of the Government of Panama, it has agreed to withdraw from the arbitration proceedings before the ICC,” it said in a post on the X account of the company Cobre Panamá. They add that “it has also agreed to suspend arbitration under the FTA.” “The company reiterates its commitment to dialogue with the Government of Panama and to being part of a solution for the country and the Panamanian people,” they stated.
First Quantum recalled that this legal process began in November 2023, when it initiated arbitration proceedings before the International Court of Arbitration of the International Chamber of Commerce (ICC). A notice of intent to arbitrate was also filed under the Canada-Panama Free Trade Agreement (FTA). Mulino says there are no talks with Cobre Panama and visits to the mine are suspended. The arbitration situation was one of the conditions the Panamanian government had set for entering into the mine’s issue and defining its future. Furthermore, President José Raúl Mulino asked the mining company to cancel the guided tours they were promoting because the site was not a tourist attraction.
He bluntly stated that they have not authorized these tours and asserted that there are currently no discussions between the government and Cobre Panamá. However, on Monday, March 24, Mulino reportedly met with his team to announce his guidelines on this issue. “I ask the mine’s management to respect what we have said, because I don’t want them to give the country the impression that the mine is operating without any problems,” he said. In his order of priorities, the president has said that the legal situation that exists with the Minera Panamá company after the Supreme Court of Justice’s (SCJ) ruling of unconstitutionality will be the next issue he will address, this after authorizing the removal of the ground material that remained in the warehouse, as well as the start-up of the thermoelectric plant.
For Mulino, the export of this material represents a “huge amount of money that has to be returned to Panama once it is processed abroad.” However, Manuel Aizpurúa, country manager for the company Minera Panamá, clarified that the income received from the export of this copper concentrate would be used to continue preserving the site “until the time when it can be reopened” and that “this sale of this concentrate must also generate fiscal commitments that the company has publicly committed to honor, of course.”
For its part, the company hopes the Ministry of Trade and Industry will provide them with a roadmap “to be able to export this copper concentrate and resume mine operations.” Newsroom Panama has learned that the mine’s warehouses hold approximately 130,000 tons of copper. At current market prices, this represents approximately $250 million. The mining company’s manager for Panama stated that the company will seek to reopen the mine. Minera Panama will seek government re-opening of copper mine. For the time being, the mine remains closed, and the government has not decided whether it will remain closed or whether a new contract will be negotiated. A comprehensive audit is underway, explained Environment Minister Juan Carlos Navarro.
It’s worth remembering that the mine has been closed for over a year, approximately 15 months, following the Supreme Court of Justice’s (SCJ) ruling of unconstitutionality regarding the contract between Minera Panamá, SA and the State, which stated that there were more than 20 articles that violated the Panamanian Constitution, as well as environmental issues that had not been sufficiently addressed. This contract was approved on October 20, 2023, but it was only in effect for about a month, following the Court’s ruling on November 28, 2023. For more than a month, thousands of people took to the streets to protest this contract. Although the mine is currently closed, the company maintains maintenance activities to preserve the Bojita Pit and prevent an environmental accident. Public consultations for the environmental audit of Cobre Panama have concluded.
