First Quantum Minerals (TSX:FM,OTC Pink:FQVLF) has launched a voluntary retirement scheme for workers at its Cobre Panama mine because it awaits authorities motion on whether or not operations will be capable to resume.
This comes after the mine’s closure in November 2023 as a result of a ruling from Panama’s Supreme Courtroom that declared the corporate’s mining contract unconstitutional following months of environmental protests.
Reuters reported on Monday (September 16) that sources conversant in the matter say First Quantum has provided the voluntary retirement choice as a part of its efforts to handle the uncertainties surrounding the mine’s future.
Staff should resolve whether or not to just accept the retirement bundle, which might take impact in January 2025, or proceed working diminished hours. The window for staff to make their resolution is ready to shut on the finish of September.
The closure of Cobre Panama has considerably diminished its workforce. From a excessive of 6,000 workers, roughly 900 staff stay on the website. Whereas a small variety of staff have already accepted the voluntary retirement provide, most are opting to work with diminished hours, based on one of many sources, who spoke on situation of anonymity.
Michael Camacho, who represents the Panama Mining Staff Union, confirmed the retirement scheme’s existence and stated some staff have opted into it. He additionally famous that First Quantum has not but obtained clear tips from Panama’s authorities on what security measures would must be applied for operations to restart.
The brand new Panamanian administration, led by President Jose Raul Mulino, has stated the mine’s future is not going to be addressed till early 2025, leaving First Quantum and its workers in a state of extended uncertainty.
Cobre Panama is a serious asset for First Quantum, accounting for a considerable portion of the corporate’s copper output whereas taking part in a key position in its efforts to handle its debt. Monetary pressures have grown as 130,000 metric tons of copper focus stay stockpiled on the mine, awaiting a authorities resolution on whether or not it may be exported.
The corporate can be pursuing compensation for the suspension of operations on the website.
First Quantum has invested roughly US$10 billion in growing the mine, which has confirmed and possible reserves of round 3 billion metric tons, over the course of a decade.
The potential to renew operations stays essential to the corporate’s long-term monetary stability, in addition to to Panama’s economic system, as Cobre Panama has contributed an estimated 5 p.c to the nation’s GDP.
The uncertainty surrounding Cobre Panama has additionally drawn consideration from copper buyers. The mine represents about 1 p.c of world output of the purple metallic, and its closure has introduced deficit issues ahead.
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Securities Disclosure: I, Giann Liguid, maintain no direct funding curiosity in any firm talked about on this article.
