Canada’s First Quantum further slows operations

Canadian miner First Quantum Minerals on Monday said it has further reduced ore processing at its mine in Panama, as blockades at a local port have disrupted shipments of supplies needed to power operations. First Quantum’s shares fell 2.7 per cent to $14.90 in morning trade on Canada’s main stock index. Without shipments arriving at the mine’s Punta Rincon port, the company expects to run out of supplies for the on-site power plant this week. The port blockade is part of ongoing protests which began after the Panamanian government and First Quantum signed a new contract Oct. 20 for Cobre Panama, a major copper mine operated by the company’s local unit Minera Panama (MPSA). The mine contributes one per cent to global copper production and five per cent to Panama’s gross domestic product. The demonstrators say the new terms are too generous to First Quantum and allege corrupt practices in the approval of the contract. The company has denied the allegations. If the “illegal actions” continue to prevent the delivery of supplies necessary to operate the power plant, MPSA will slow down the remaining processing train this week and temporarily halt production, the company said in a statement. The company, which had reached a deal on wages with the labour union earlier this month, said MPSA has made a tax and royalty payment of $567 million for the period from December 2021 to October 2023 to the Republic of Panama. First Quantum’s market capitalization has fallen about 45 per cent since the protests started in late October. Panama’s top court will, possibly as soon as mid-december, decide whether to revoke the contract. A Reuters survey earlier in November found that a majority of lawyers believe that the court would likely revoke the contract.