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PANAMA CITY (Reuters) -Panama’s government and Canada’s First Quantum Minerals (OTC:FQVLF) agreed on the final text for a contract to operate a key copper mine, according to a statement signed by both parties.
The new contract guarantees a minimum annual income of $375 million to the Central American government, and will be effective for 20 years with the option to renew for 20 more.
“With this contract, Panama expects to receive about ten times more than what it was getting” under the previous contract, the statement added.
First Quantum (NASDAQ:QMCO) paid $61 million in royalties to Panama’s government in 2021, while the Cobre Panama mine posted sales revenues of $3.2 billion for the year, company data showed.
The proposed concession contract is subject to a 30-day public consultation process and approvals by the Panamanian Cabinet, Comptroller General of the Republic and the National Assembly.
A separate statement from the Canadian firm stated Panama’s maritime authority will issue a resolution Wednesday for its local subsidiary, Minera Panama, to resume concentrate loading operations at a port. Ore processing is expected to resume over the next several days.
First Quantum suspended ore processing operations at the copper mine on February 23 after a government order suspended its loading permissions at the port, limiting its capacity to store copper.
“I am pleased that we now have a pathway to continuing our ongoing substantial investments in the country,” First Quantum’s Chief Executive Officer Tristan Pascall said in the firm’s separate statement.
