Pending audits and uncertainty over closing costs of Cobre Panama mine

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By LatAm Reports Editorial Team

The absence of audits affects critical decision-making, such as those related to the storage of copper concentrate in the Cobre Panama project.

The absence of audits affects critical decision-making, such as those related to the storage of copper concentrate in the Cobre Panama project.

The Ministry of Trade and Industries (Mici) established a working schedule that included environmental audits and the appointment of a group of experts to follow up on the implementation of the Panama Minera closure plan. However, by March 2024, these actions have not yet taken place, as planned.

The absence of audits has a direct impact on critical decision-making, such as the measures that the Government intends to take in relation to the 132,000 tons of copper concentrate stored in the Copper Panama project.

After the plenary of the Supreme Court of Justice unanimously declared that Law 406 of October 20, 2023, approving the concession contract between the State and Minera Panama, was unconstitutional, the Mici consulted the Attorney General of the Administration, Rigoberto González, on what would be the recommended legal way to resolve the disputes and reasonable doubts related to the possession, disposition, property and usufruct of the copper concentrate stored in the mine.

González replied on January 29 that it was necessary to carry out administrative, economic, accounting, physical and chemical expertise and actions that would be considered relevant in order to determine in a reliable way aspects such as the quantity, seniority and commercial value of the copper concentrate stored in Minera Panama.

The Minister of Commerce, Jorge Rivera Staff, recognizes that all these evaluations are “urgent,” to verify whether the concentrate was extracted inside or outside the concession contract, thus complying with the provisions of the Mineral Resources Code and other applicable legal provisions.

Minera Panama, a subsidiary of the Canadian First Quantum, assures that the stored copper concentrate is its property, so it hopes that with the sale of the stored material it will cover part of the monthly cost of the Safe Preservation and Management (PSG) plan.

However, it is not known when the work schedule involved in the recommended audits is to be launched.

Joana Abrego, a lawyer at the Panama Center for Environmental Incidence (CIAM), warns that it is essential for citizens to understand what the environmental management of the project has been, considering that responsibility for alleged environmental violations detected in a series of reports made in 2021 has not been determined.

Hence, it considers it imperative to initiate as soon as possible with all the investigations that are needed.

The National Assembly questioned the Minister of Commerce about the inventory of chemicals and the costs of closing.

In this regard, Rivera indicated last week that the National Commission for the Study and Prevention of Drug-related Crimes of the Attorney General’s Office is the office responsible for monitoring and inventorying the 51 deposits of chemical materials and compounds in the mine.

Most of these chemical compounds must be transferred by sea or land outside the project; however, they have not been transferred due to the partial closure of the entrance route to the mine at kilometer 33 and by the closure of the terminal of Punta Rincón, he said on March 6.

Chemical materials are stored in safe warehouses and warehouses. As of 26 January 2024, 595 tons of sodium xanthato left the country by sea and on 17 January 2024 480,000 tons of sodium hydrosulfite were re-exported, the official said.

Does the MICI have an inventory of assets belonging to Minera Panama?

Doesn’t have an inventory of goods. However, for the Safe Preservation and Management plan, an updated inventory will be requested, Rivera said.

Who will bear the costs of closing the mine that was operated by Minera Panama and the mines that will not be renovated the concession for the exploitation of metal mining?

With regard to the cost of closing the Copper Panama mine and other mines, it is not defined who will cover these costs, he replied to the deputies.

This article has been translated from the original which first appeared in Prensa