First Quantum shares plunge as Cortizo announces referendum

The shares of the Canadian mining giant First Quantum Minerals plummeted by up to 36% on the Toronto Stock Exchange on Monday, October 30, the lowest level in 26 years.

The fall is recorded after the president of Panama, Laurentino Cortizo, announced a popular consultation for the population to decide whether to repeal or maintain a mining contract awarded to the company this month.

There is widespread discontent over the approval of the contract, the terms reached, and the possible irreparable environmental damage for 40 years.

On October 22, the company had announced to investors the approval of Law 406, which approved the mining concession contract for the Cobre Panamá mine.

First Quantum Minerals indicated to its investors that the sanction of Law 406, by Cortizo, was the final step in the review of the legal framework for the Cobre Panamá mine and that they were “pleased that the revised contract established the bases for a renewed long-term relationship between Panama and First Quantum .”

However, the demonstrations in which nearly 200,000 people participated in the streets of the capital city, the closure of the main roads throughout the country, and the popular rejection after the approval of the mining contract, forced Cortizo to propose a citizen consultation.

For First Quantum Minerals, the Panama operation is the most important in a mining portfolio.

With 3,000 million tons of proven and probable reserves, the Cobre Panamá project is one of the largest copper mines opened worldwide in the last decade. They indicate that their projection is to produce more than 300,000 tons of copper per year, along with gold, silver, and molybdenum.