First Quantum could remove copper concentrate from Panama mine after election, CEO says
Updates with details on minority sale of Zambian asset in para 11-12, adds amount of copper concentrate in first paragraph
By Divya Rajagopal
April 24 (Reuters) -Canadian miner First Quantum Minerals FM.TO believes it will be able to take the already mined 121,000 tonnes of copper concentrate out of its disputed mine in Panama after the national elections there in May, the company's chief executive said on Wednesday.
Panama's current government ordered the closure of the Cobre Panama copper mine last year after public protests over environmental damage from mining in the country. Cobre Panama accounted for about 1% of the global copper output, and contributed about 40% to First Quantum's revenue last year.
First Quantum has been negotiating with Panama's government to allow it to sell the copper that it mined before the dispute began. Copper was trading at $9772 a metric tonne at the London Metals Exchange on Wednesday. Any proceedings from the sale could help cover the costs of maintaining the mine.
"Obviously, in the context of election politics and a strong debate around that, the balance of probability probably spills over after the election," said Tristan Pascall, CEO of First Quantum Minerals, when asked during an analyst call when the company expects to take out the copper concentrate from the mine site.
Cobre Panama is under dispute after the Panama Supreme Court nullified its mining contract and the country's president closed the mine following the public protests.
A new government in Panama could overturn that, however polls show that people of Panama are still against mining.
The closure pushed First Quantum to undertake a series of debt restructuring measures, including issuing equity worth $1 billion and corporate debt worth $1.6 billion. It is also considering bringing in an equity partner for its Zambian mines.
Reuters in March reported that First Quantum officials met with Chinese government officials to discuss the prospect of copper miner Jiagnxi Copper buying the disputed copper from Panama after the elections.
Shares of First Quantum were up 2% on the Toronto Stock Exchange around midday.
On the proposed minority sale of the Zambian mines, the company said that it will enter into an partnership only if it brings value to shareholders and the South African government.
"The recent financing transaction that we put forward through Q1 means we don't have to enter into a transaction here," Ryan MacWilliam, CFO of First Quantum said, referring to the Zambia mines.
Reporting by Divya Rajagopal and Seher Dareen; Editing by Krishna Chandra Eluri, Michael Erman, Elaine Hardcastle
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