First Quantum Minerals Ltd. (“First Quantum” or “the Company”) (TSX: FM) today issues the following statement on the status of its negotiations with the Government of Panama regarding a framework governing the operation of the Cobre Panama mine by part of its subsidiary Minera Panamá, SA (“MPSA”).
The Government of Panama and MPSA were unable to reach an agreement before the December 14 deadline imposed by the government. The economic package proposed by MPSA would make Cobre Panama one of the highest payers of royalties and taxes among the large producing copper mines in the Americas. The economic package was agreed in almost all the clauses and incorporated the agreements in principle made at the beginning of this year, including a contribution of
$375 million in annual benefits with mutually agreed protections. MPSA believes that its proposal achieves the revenue objectives of the Government of Panama and provides the necessary conditions to ensure the long-term future of the mine. However, the necessary legal protections on termination, stability and transition arrangements could not be agreed. MPSA remains available and open to a more constructive dialogue.
“Over the last 25 years, First Quantum and its predecessor have invested at least $10 billion to build one of the largest, safest and most modern copper mines in the world. It is the largest private investment in the history of Panama and a significant contributor to the Panamanian economy and important social programs”, commented Tristan Pascall, General Director. “Our goal remains to find a mutually acceptable resolution, which we believe is in the best interests of all parties, including our employees and their families, local communities, the country of Panama, and the Company’s investors and shareholders.”
