How a US$10 billion mine became a cautionary tale for the energy transition – by Jacob Lorinc (Bloomberg News – April 16, 2024)

When the group of mining executives arrived at Panama’s regal Palacio de las Garzas, they were ushered past the ornate, wood-paneled ceremonial rooms and straight to the private office of the president.

This was December 2016, before the upswell of anti-mining protests that would throw the country into chaos, and the team from First Quantum Minerals Ltd. were greeted as old friends. After all, they were building the country’s most important project since the Panama Canal had been opened a century earlier.

But as they compared notes on the progress of their Cobre Panama copper mine, the president issued a warning. First Quantum had lucked into an unusually sweet deal in Panama, he said. Sooner or later, the company would have to agree on new terms with the government and pay more taxes. What was left unsaid: it would be better to do it sooner, under a business-friendly government like his, than to gamble on Panamanian politics.

The stakes were high. The mine was set to be the centerpiece of Panama’s economy, generating between four and five per cent of its gross domestic product and employing one in every 50 workers in the country. For First Quantum, which had borrowed heavily to construct a mine in the dense Panamanian jungle, it simply had to succeed.

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