First Quantum Minerals Provides Update ON Status of Cobre Panamá and the Punta Rincón Port
NEWS RELEASE
23-06
February 6, 2023
www.first-quantum.com
FIRST QUANTUM MINERALS PROVIDES UPDATE ON STATUS OF COBRE PANAMÁ
AND THE PUNTA RINCÓN PORT
Toronto, Ontario (February 6, 2023) – First Quantum Minerals Ltd. (“First Quantum” or “the Company”) (TSX: FM)
announces that on January 26, 2023, Minera Panamá, S.A. (“MPSA”) received Resolution No. 007 -2023 (the
“Resolution”). The Resolution was issued by the Panamá Maritime Authority (“AMP”) and requires the suspension of
concentrate loading operations at the Cobre Panamá port, Punta Rincón, until evidence is provided that the process
of certification of the calibration of the scales by an accredited company has been initiated.
MPSA submitted the required proof of the initiation of the certification process by an accredited company on
February 3, 2023. This Resolution deviates from the prior process of internationally accepted certifications that MPSA
has previously provided to AMP, which have been accepted until now. As a result, MPSA has suspended loading
operations while it awaits a response from the AMP.
It will be to the detriment of Panamá, the mine’s employees, suppliers and the broader Panamanian economy if the
Government of Panamá (“the Government”) forces MPSA to shut Cobre Panamá, which may become necessary if
concentrate is not shipped by mid-February due to limited storage capacity on site.
The Resolution is part of a series of escalating attempts by the Government to pressure the Company into accepting
a refreshed concession contract on the Government’s terms.
Recent steps taken by the Panamanian authorities include the following actions, which prejudice good -faith
negotiations and are both untimely and unnecessary, in particular given the recent progress that both parties have
made towards resolving outstanding issues:
Taking Steps to Block Copper Exports: The AMP has taken several actions to obstruct operations at MPSA’s
Punta Rincón shipping terminal. These include conducting extraordinary and unusual inspections, instructing
maritime pilots not to provide service to vessels and issuing the Resolution,
Attempting to Place Cobre Panam á on “Care & Maintenance”: On December 19, 2022, by way of
executive Resolution No. 234, the Government directed MPSA to submit a plan to place the mine under “care
and maintenance.” First Quantum believes the Government’s requirement is an unnecessary step that will
have serious and negative consequences. MPSA has pursued a long series of appeals which remain pending
with the Ministry of Commerce and Industries, and
A Change of the Government’s Long -Held Position on the Validity of the Concession Contract:
Following a 2018 Supreme Court ruling on the unconstitutionality of “Law 9” (the “Ruling”), which approved
MPSA’s concession contract, the Government issued several public statements reaffirming that the
concession contract remained valid in all aspects given the nature and effects of unconstitutionality rulings.
Prior to the Ruling, the Ministry of Commerce and Industries issued Resolution No. 128 of 2016 (the
“Extension Resolution”) granting the first extension of the concession contract through to 2037. In connection
with two proceedings filed by third parties seeking annulment of the Extension Resolution, t he Procurador
de la Administración (“Administration’s Attorney”) issued opinions in 2018 and 2019 stating that the
resolution was legal. On January 11, 2023, the Administratio n’s Attorney abruptly switched course and filed
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motions in the two proceedings asking the Supreme Court to declare that the Extension Resolution be
deemed without legal effect. The Supreme Court has not yet ruled on the matter.
First Quantum and MPSA are prepared to meet, and in part exceed, the objectives that the Government outlined in
January 2022 related to revenues, environmental protections and labour standards. This includes a minimum of $375
million per year in government income, comprised of corporate taxes and a profit-based mineral royalty of 12 to 16
percent, with downside protections aligned with the Government’s position.
The Company has also expressed its earnest desire to resolve all outstanding issues and continues to engage with
the Government with a view to concluding a reasonable and durable arrangement regarding the long-term future of
Cobre Panamá. At the same time, First Quantum and MPSA are doing everything possible to support the workforce,
preserve the value and integrity of the mine and defend First Quantum and its stakeholders, including through all
available legal means.
For further information, visit our website at www.first-quantum.com or contact:
Bonita To, Director, Investor Relations
(416) 361-6400 Toll-free: 1 (888) 688-6577
E-Mail: [email protected]
CAUTIONARY STATEMENT ON FORWARD-LOOKING INFORMATION
Certain statements and information herein, including all statements that are not historical facts, contain forward-looking statements and
forward-looking information within the meaning of applicable securities laws. The forward-looking statements in this news release include
statements as to effects of the Government’s actions on the ability of MPSA to continue operations at Cobre Panamá and the Company’s
readiness to reach an agreement with the Government regarding the long term future of Cobre Panamá. With respect to forward-looking
statements and information contained herein, the Company has made numerous assumptions, including as to the effects of the proposal
put forward by MPSA. Forward -looking statements and information by their nature are based on as sumptions and involve known and
unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements to be materially different
from any future results, performance or achievements expressed or implied by such forw ard-looking statements or information. These
factors include, but are not limited to, political stability in Panamá, potential social and environmental challenges, and ev ents generally
impacting global economic, political and social stability. There may al so be other factors that cause actual results, performance,
achievements or events not as anticipated, estimated or intended, including the risks, uncertainties and other factors discus sed in the
Company’s Annual Information Form. The Company undertakes no obligation to reissue or update forward -looking statements or
information as a result of new information or events after the date hereof except as may be required by law.