Resource World | 19 June 2025
Franco Nevada releases Cobre Panama arbitration update
Franco-Nevada Mining Corp. [FNV-TSX, NYSE] has released an update regarding its arbitration proceeding related to the Cobre Panama mine. Following an engagement with the government of Panama’s legal counsel, Franco Nevada said it has agreed to suspend its arbitration proceeding. The company had previously filed a request for arbitration under the Canada-Panama free trade agreement to the International Centre for Settlement of Investment Disputes on June 27, 2024.
In a press release, Franco-Nevada reiterated its hope for a resolution with the Stage of Panama providing the best outcome for the Panamanian people and all parties involved. The announcement comes after First Quantum Minerals Ltd. (FM-TSX) issued a press release on May 30, 2025, stating that its Panamanian subsidiary has received approval of the Preservation and Safe Management program for the Cobre Panama mine from the Government of Panama. It said this will allow for the integral preservation and safe management activities and the associated environmental measures at site, which will be funded through the export of 121,000 dry metric tonnes of copper concentrate currently stored at site.
On Thursday, First Quantum shares eased 0.56% or 12 cents to $21.31. The shares trade in a 52-week range of $13.81 and $23.28.
Cobre Panama is First Quantum’s flagship operation. It is a huge open-pit copper project located in the Panama jungle, about 120 kilometres west of Panama City and ranks as First Quantum’s key asset. The production complex includes two open pits, a processing plant, a 300-megawatt power station and international port. The mine accounted for 5.0% of Panama’s GDP in 2023.
On March 8, 2023, First Quantum and the government of Panama reached an agreement covering terms and conditions for a refreshed concession contract at Cobre Panama. Panama’s government and the mining company agreed on a contract which would guarantee the Central American nation annual income of US$395 million while allowing First Quantum’s local unit to operate the Cobre Panama project, an open pit copper mine for at least 20 years.
However, protesters criticized both the deal and the mine’s environmental costs, even after Cortizo on October 27, 2023, rejected all new mining projects. Following illegal blockades of the international port and mine access road, Cobre Panama halted production in November, 2023. And following a request from the Government of Panama in December, 2023, which came after a ruling by the Supreme Court, First Quantum placed Cobre Panama into a phase of Preservation and Safe Management. “This means we are working to safely and responsibly manage the mine, the company has said.
Franco Nevada is a Toronto based royalty and streaming company. Before the mine was shut down, Franco-Nevada garnered 15% of its revenue in a single quarter from Cobre Panama. Franco-Nevada bears no cost for the production that isn’t delivered, the company has said.
On Thursday, the shares rose 0.39% or 92 cents to $231.35. They trade in a 52-week range of $245.55 and $156.31.
