Demonstrators protest against a mining contract outside the National Assembly in Panama City, Friday, Oct. 20, 2023. Lawmakers approved on Friday a new mining contract between Canada's First Quantum Minerals and Panama's government at the Cobre Panamá copper mine. THE CANADIAN PRESS/AP-Arnulfo Franco
February 20, 2024 - 3:51 PM
TORONTO - First Quantum Minerals Ltd. says it lost US$1.45 billion in the last quarter of 2023, and warned its ability to continue operating could be in doubt if it is unable to shore up its balance sheet in light of the shutdown of its Cobre Panamá mine.
The Toronto-headquartered mining company suspended production at the open-pit copper mine in Panama at the end of November after Panama's Supreme Court ruled that a 20-year concession agreement covering the copper mine was unconstitutional. The mine had been the focus of ongoing blockades and widespread protest by environmentalists and nationalists.
The company has since estimated it will cost between US$15 million and US$20 million per month to safely maintain the site while it is shut down.
On Tuesday, First Quantum said the situation in Panama has impacted the company's earnings potential to the point that its ability to continue could be threatened within the next 12 months.
But chief executive Tristan Pascall said the company is confident in a number of initiatives it has undertaken to bolster its finances and protect against this risk, including signing of a US$500-million copper prepay arrangement. The company is also aiming to sell off minor assets and shares in major ones, and is working with lenders to amend and extend its loan facilities.
First Quantum said its fourth-quarter total copper production was 160,200 tonnes, a 28-per-cent decrease from the third quarter of 2023. Most of this decrease was due to the situation at Cobre Panamá, which produced 62,616 tonnes of copper in the fourth quarter, a decrease of 50,118 tonnes from the third quarter of the year.
This report by The Canadian Press was first published Feb. 20, 2024.
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