By not receiving the royalties, analysts at La Prensa newspaper say the executive is reaffirming the strategy it has been proclaiming in recent days, which echoes the argument that Canadian transnational Fisrt Quantum’s subsidiary does not have a concession deal.
In 2017, the Supreme Court (CSJ) declared unconstitutional Law No. 9 of February 25, 1997, which approved the concession agreement between the state and the company Petaquilla Minerals, as the basis of the agreement with this copper mining company Pit in Donoso, province of Colón.
In this regard, the Ministry of Trade and Industry (MICI) itself has decided that with this judgment of the CSJ the concession operated by Minera Panamá has been canceled and therefore the drafting of a new text that the company does not want to sign, despite having all its Clauses approved in January last year.
It was believed that in 2022 the government would be able to receive a minimum income of $375 million per year.
Exactly one year ago, on January 17, 2022, the President of the Republic, Laurentino Cortizo, informed the country that the negotiations with Minera Panamá were closed and that from that moment it was necessary to follow the relative procedures, including the drafting of the new treaty, endorsement and approval by the National Assembly (Parliament).
But as the last month of 2022 rolled around, it became clear that this plan had failed, and the same government announced that Minera Panama “was not ready to sign the previously agreed contract”.
On December 15 – after the deadline for concluding the agreement – the company presented a new proposal which, among other things, changed economic aspects such as the license fee system agreed in January 2022.
In recent statements to foreign press correspondents, MICI head Federico Alfaro clarified that the government is not currently in negotiations with Minera Panama but in the process of drafting a contract, claiming that there are deep fissures in this episode.
For Panama, the miner has continued to operate the Cobre Panama Project without a contract and this irregular status cannot continue indefinitely.
As a result, a mine care and maintenance plan has been ordered that amounts to the closure of commercial operations at the processing facility, a measure the Company appealed January 10th.
Alfaro also told correspondents that the government is evaluating all available options if ongoing negotiations to continue operations fail, including concession to another company, without giving further details.
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