First Quantum CEO: Panama’s next government cannot ignore mining sector

Cobre Panama mine began producing and shipping copper concentrates in June 2019. (Image courtesy of Cobre Panama.)

Two months after protests led the Panamanian government to order the shutdown of First Quantum’s Cobre Panama mine, chief executive Tristan Pascall, sees an opportunity for discussing mining’s contribution to Panama’s economy as the country approaches an election in May.

“We see that some of the emotion (from the protests) has really dialled back,” Pascall told the Financial Post. “There’s significant economic challenges emerging in the country … and we believe it’s impossible for the next government to ignore the contribution that a responsible mining sector can make.”

The mine accounts for approximately 5% of Panama’s gross domestic product and employed about 7,000 people, with another 33,000 individuals depending on the mine indirectly.

“There’s more questioning around the decision” regarding the impact the move could have on the country’s economy, Pascall told the Financial Post.

The Panama copper mine accounted for about 40% of First Quantum’s revenue and the closure order led to a near-halving of the company’s market value.

First Quantum is now exploring options to “manage its balance sheet,” which include selling smaller mines, bringing strategic investors into its larger mines and evaluating ways to raise funds. It has also initiated international arbitration over the contested Cobre Panama contract.