First Quantum falls after Panama panel recommends operating giant mine under 'orderly closure'

First Quantum Minerals (FQVLF) plunged 16% to its lowest in nearly two months on Wednesday after a Panamanian government commission recommended the "orderly closure" of the company's flagship Cobre Panama copper mine.

The commission's report recommended that Panama evaluate ‌a new agreement with First Quantum (FQVLF) that would end pending international arbitration claims and allow the project to operate under conditions designed to finance closing the mine over time.

The ​report did not describe the scope, timing, or legal structure for any restart, but it said closing such a large site would ​take decades and require ongoing environmental management and monitoring; Reuters reported earlier ​that the commission would propose a state tie-up with First Quantum (FQVLF) for the mine, one of the world's largest open-pit copper deposits.

J.P. Morgan analysts said the official document implied a multi-decade operating framework followed by monitoring and closure, although they cautioned that the scale, timing, and economics of any restart remain undefined.

First Quantum (FQVLF) stopped operations at the mine in 2023 after Panama's Supreme Court ruled that a 20-year contract allowing for its operation was unconstitutional, which followed widespread protests by environmentalists concerned about its impact in a delicate jungle ecosystem.

Franco-Nevada (FNV), which does not own an equity stake in Cobre Panama but holds a 100% precious metals stream covering the entire production of the mine, fell 4% on Wednesday.