First Quantum Suspends Production at Panama Copper Mine Due to Blockade Affecting Key Supplies.

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First Quantum Minerals Ltd. announced on November 20th that if no shipments arrived at Punta Rincón port of its mine, the on-site power plant’s supply would be depleted within a week starting November 20, 2023, leading to a temporary production halt. This forecasted halt has become reality.

Citing Bloomberg, First Quantum suspended production in Panama due to a blockade on its ships, restricting key supplies to one of the world’s largest and newest copper mines.

“Cobre Panama is no longer operating at commercial production levels,” First Quantum stated, confirming earlier comments from the union.

Due to escalating protests over the operating contract, First Quantum began slowing operations at its flagship mine last week. The protests included a small boat blocking a port, used for transporting coal and other materials to the mine, which accounted for nearly 40% of First Quantum’s revenue last year and about 1.5% of global copper supply.

Last month, massive protests erupted over the renewal of the operating contract for Cobre Panama copper mine, casting uncertainty over the company’s future. Panama’s Supreme Court is expected to start deliberations this Friday on several constitutional challenges to the contract.

The company stated: “Our on-site team will continue to ensure the safety of the plant, power facilities, and all related infrastructure, preparing for a rapid ramp-up once the international port reopens.”

Utramipa union urged the government and police to intervene in the blockade to allow workers to return to their jobs. Union leader Michael Camacho said, “As a union, we are concerned because the authorities are silent.”

Despite rising copper prices, First Quantum’s stock in Toronto fell 0.9%. The Vancouver-based metal producer’s stock has already fallen more than 50% this year. On November 20, First Quantum announced that its subsidiary Minera Panamá S.A. (MPSA) paid $567 million in taxes and concession fees to the Republic of Panama from December 2021 to October 2023, one of the largest in the global copper mining industry and Panama’s history. Besides these hefty taxes and concession fees, the copper mine’s workforce accounts for over 2% of Panama’s total employment, paying nearly $20 million weekly to Panamanian suppliers. If the mine continues operating, its contribution to Panama’s overall economy is estimated to exceed $50 million weekly, approximately 5% of Panama’s annual GDP.

Copper plays a crucial role in the global transition to clean energy, and its future supply, expected to be limited with surging demand, has become a focal point for global policymakers and corporate executives.

[Source – 上海有色网] First Quantum暂停巴拿马铜矿生产 因封锁影响关键供应

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