In a major blow to First Quantum Minerals’ plans to develop the Cobre Panama copper mine, the country’s government has ruled the contract for the project unconstitutional.
First Quantum Minerals, a Canadian-based mining company, has been developing the Cobre Panama copper mine since 2014. The project has been highly anticipated, as the copper mine is one of the largest in the world and has long been considered to have great potential.
Now, however, the government of Panama has ruled that the contract between First Quantum Minerals and ProGovernment, the energy company that holds the mining rights to the project, is unconstitutional.
The ruling comes after months of disagreement between the government and First Quantum Minerals over the terms of the contract. First Quantum Minerals had wanted to retain exclusive access to the mine and did not want to share its profits or access with other parties. The government, however, demanded that the terms be adjusted, as it believed that the contract was too exclusive and not beneficial to the people of Panama.
In response to the government ruling, First Quantum Minerals stated that it is evaluating its options and is disappointed that the contract has been ruled unconstitutional. The company also stated that it remains committed to developing the Cobre Panama copper mine but will need to find a resolution to the current issue with the government in order to move forward.
The ruling in Panama serves as a reminder of the importance of getting the details of any contract right in order to ensure that it is compliant with the laws and regulations of the country. It also demonstrates how even the biggest of projects can be derailed if companies are not willing to negotiate and come to an agreement that is beneficial to all parties involved.
