Panama Unlocks $29M from First Quantum Mine to public works 

Cobre Panama – once trumpeted as a game-changing $10 billion project – has been idle since late 2023 after Panama’s Supreme Court found the legal path employed to grant swathes of its operating contract was unconstitutional.

Panama announced that the $29 million from the sale of its First Quantum mine will be directed to public works. However, it has not taken Panama long to turn a potentially divisive period within recent mining developments into something of a short-term stimulus package, with it soon to inject some $29 million worth of royalties from a copper stockpile at Cobre Panama into various pressing works projects around the country. The money, gathered from the sale of its copper concentrate stockpiled at First Quantum Minerals’ shutdown facility, will be put towards improving local health centers, schools, and infrastructural works for water and electricity. 

The headlines mask a frazzled backdrop. Cobre Panama – once trumpeted as a game-changing $10 billion project – has been idle since late 2023 after Panama’s Supreme Court found the legal path employed to grant swathes of its operating contract was unconstitutional. The halt provoked nationwide controversy, protests and a protracted standoff between the Panamanian state and First Quantum, the Canadian owner. That unresolved legal and political standoff has left the mine in “preservation and safe management” mode as government auditors and environmental overseers scrutinise the site. 

According to reports, the amount realized ($29m) represents proceeds accrued from the sale of more than 122,000 tons of copper concentrate that had been stockpiled. Commerce Minister Julio Molto argued that there was no sense holding on to it given that it had already been mined and that it would be meaningless as it affects the mine’s yet-to-be determined status. The amount will be seen as an injection for projects as it will not be an ongoing source for an as yet undecided mine. 

The detailed plans for monetizing it will surely have several interpretations. To local communities and leaders, these payments are proof that there have been direct benefits extracted from the mine’s legacy, at a period when national coffers were worried about getting quick wins. But for First Quantum and its investors, these sales promise questionable undertones about property rights and government contracts and talks. First Quantum argued about being responsible for handling and safeguarding the mine based on applicable legal standards, at a period when it had reduced some site operations and employee presence so that there would be audits as well as monitoring. 

Economists and sector analysts caution the windfall does little to change the deeper dynamics at play: When operating at full capacity, Cobre Panama accounted for a significant chunk of Panama’s GDP and export earnings. Its shutdown-and the broader political sensitivities attached to mining in the country-continue to shroud long-term fiscal planning and investor confidence in a cloud. There has been international arbitration and legal wrangling aplenty in the recent storyline: First Quantum had pursued hefty claims in the wake of the shutdown, although recent moves suggest both sides are treading carefully as they weigh next steps. 

The government has said it expects a final audit report shortly; that report, officials add, will help determine whether the mine can be reopened, turned over to a different operator or moved into a prolonged closure and remediation phase. Diverting royalties from a stockpile to immediate public works in the interim is a practical if limited response – one that placates short-term social and infrastructure needs while the bigger, more complex questions over legal rights, environmental obligations, and the nation’s mineral policy remain unresolved. 

For Panama, the episode serves as a tightrope reminder between securing major foreign investment and protecting sovereign control, environmental protection and community consent. The $29m will buy clinics and classrooms; it will not, however, purchase a political consensus. How the government navigates the audit’s findings and the continuing dialogue-or dispute-with First Quantum will determine whether Cobre Panama ultimately returns as an engine of growth, becomes a case study in responsible closure, or lingers in legal limbo for years to come.