First Quantum halts $6.4bn Panama copper project

First Quantum halts $6.4bn Panama copper project

Cobre Panama open-pit copper development project. (Image from archives)

Minera Panama, a subsidiary of Canada’s First Quantum Minerals (TSX:FM) (LON:FQM) has temporarily halted construction at its massive US$6.4 billion copper-gold-silver Cobre Panama project because of a labour dispute with some of its construction workers.

The illegal strike, said the Vancouver-based firm, is related to the implementation of a new work roster, which changes the schedule to 21 days of work with seven days off, compared to 12 days of work with two days off, previously.

The move marks another setback for the open pit Cobre project, which has already faced delays and climbing capital costs.

First Quantum, gained control of Cobre Panama last year, after acquiring rival Canadian copper miner Inmet Mining Corp. in a hostile deal worth nearly $5 billion.

The company, Canada’s biggest pure copper player, has operating mines in Zambia, Mauritania, Australia, Finland and Peru.

Cobre Panama, about 120 km west of Panama City, and 20 km from the Caribbean Sea coast, is one of the largest of a slew of massive greenfields copper projects to enter production over the next few years.

Codelco's 160,000 tonnes-plus Ministro Hales mine in Chile, Glencore's Las Bambas project in Peru it is close to selling, expansion at other Codelco properties and at BHP Billiton's Escondida, will increase supply of the red metals by some 4% annually through 2016.