Panama is considering the creation of a state-owned mining company as a possible route to reopen Cobre Panama, the large copper mine operated by Canada's First Quantum Minerals before its shutdown in 2023. The idea would place the state at the center of any new structure for the asset, whose previous contract was struck down as unconstitutional.
The proposal under discussion would allow a public entity to partner with First Quantum or hold the concession while the company participates under revised terms. One structure being weighed would leave First Quantum with a majority operating stake and Panama with a significant minority interest; another would keep the state as concession holder while the company pays royalties and taxes through a lease-like arrangement.
The design matters because Panama passed a ban on new mining concessions after the political and social conflict that surrounded Cobre Panama. A state-owned vehicle could give the government a way to comply with that framework while reopening a mine that had become a major part of the national economy and a relevant source of global copper supply.
The mine has been closed since Panama's Supreme Court ruled the company's contract unconstitutional in 2023, following large protests over environmental, fiscal and governance concerns. Since then, the government has authorized limited steps around stockpiled copper concentrate, an on-site power plant and an environmental audit, but it has not approved a full restart of mining operations.
For First Quantum, the talks are central to the future of one of its most important assets. The company has paused a multibillion-dollar arbitration claim while negotiations continue, leaving the outcome dependent on political approval, legal design, public acceptance and the government's final decision on whether a reopening can be justified under new terms.
