First Quantum Minerals Ltd.’s ability to continue operating in Panama is uncertain, after the country’s president called a referendum over a recently approved contract for the Canadian company’s Cobre Panama mine.
The government of Panama signed the new 20-year Cobre Panama contract into law just over a week ago, after reaching a tentative agreement with the Vancouver-based miner earlier in the year. The deal would result in First Quantum paying drastically higher Panamanian taxes.
But as the contract was making its way through Panama’s legislature, public opposition boiled over into boisterous street protests attended by thousands. The contract was denounced by environmentalists, Indigenous groups, labour activists and religious groups, who opposed it both because of its financial terms and because of the impact the open-pit mine has on the environment.
Amid escalating protests after the law was passed, Panamanian President Laurentino Cortizo, who had broadly been supportive of First Quantum, made a sudden reversal over the weekend. In a televised national address on Sunday, he announced that a referendum will be held on Dec. 17 to let the Panamanian people decide whether or not to repeal the law that legalized the contract.
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