Canadian miner First Quantum Minerals (TSX:FM) has made the first shipment of concentrate from its massive mining and processing complex in Panama, the largest copper operation coming to market over the next couple of years and the biggest single private sector investment in the nation’s history.
The key milestone for Cobre Panama, located about 120 km west of Panama City and 20 km from the Atlantic coast, comes at a time when the market is in need of high concentrate volumes, due to recent supply disruptions, including a strike in the world’s largest producer, Chile’s Codelco.
The project is on track to deliver between 140,000 and 175,000 tonnes in 2019. About 80% of total output will be generated in the second half of the year, as the mill ramps up to its annual capacity of 72 million tonnes by the end of this year.
After that, the Toronto-based company expects to increase copper output from 85 million tonnes per year to 100 million annual tonnes, beginning in 2023.
The expanded throughput involves the earlier development of the adjacent Colina pit, the addition of a ninth mill, an expanded mining equipment fleet, additional conveyors, an in-pit crusher and other infrastructure to access the nearby pit.
In 2017, First Quantum spent close to $1 billion to advance construction at Cobre Panama (cobre is Spanish for copper), investing a further $830 million in 2018. This year, the company plans to allocate around $110 million to keep advancing the project until it reaches its full capacity of more than 375,000 annual tonnes of copper.
Cobre Panama processed its first ore in early February, fifty years after the deposit was discovered, but only six years since First Quantum gained control over it through the acquisition of rival Canadian copper miner Inmet Mining.
Once the mine reaches full production, expected in 2021, First Quantum’s total production will surpass 900,000 tonnes a year, placing it among the world’s top six copper producers.
Panama will also reap the benefit from the operating open-pit mine, as it is expected to generate around $2 billion worth of annual exports during its 34-years of life. That, according to Christie, is equivalent to around 4% of the Central American nation’s current GDP.
First Quantum, which has operating mines in Australia, Zambia, Mauritania, Turkey, Spain and Finland, is also developing two other projects in Latin American — Haquira in Peru and Taca Taca in Argentina – but the miner hasn’t decided which one it will develop first.