Govt plan for Cobre Panamá care and maintenance to require minimal mining activity

Panama published the technical summary of the expanded preservation and safe management plan (PGS) for the Cobre Panamá copper mine.

The plan is based on the initial one presented by the company and determines that a regulatory framework that allows processing the available mineral, among other minimal mining activities, is required.

“Mineral processing is the most effective solution to avoid future environmental liabilities by eliminating the risk of environmental contamination and requires a regulatory framework to be executed,” said the plan, which was created by the commerce and industries ministry's (MICI) natural resources department.

The department began working on the plan after an intergovernmental commission conducted several inspections of the facilities owned by Minera Panamá, a subsidiary of First Quantum Minerals, in April.

Likewise, it concludes that the more than 130,000t of copper concentrate that are stored “must be moved off site since long-term storage creates environmental and safety risks, and operational complications.”

The plan includes a series of measures that must be taken to guarantee the physical and chemical stability of the copper mine, as well as other preservation tasks necessary for machinery, custody of dangerous substances and equipment, and social effects on projects that, with the suspension of operations in December 2023, must be cared for and maintained.

Last year, the government and First Quantum agreed a new contract, after the original agreement for the mine was declared unconstitutional in 2017. But thousands of protesters opposed the new contract on environmental grounds.

After the supreme court declared the new contract unconstitutional, the authorities ordered the closure of the open pit mine, even though the company and mining chamber Camipa argue that the ruling does not stipulate shuttering Cobre Panamá.

The expanded plan released Monday night highlights that a significant amount of exposed ore remains in the pit, in the material stockpile at the mine, and in the crushed ore stockpile at the processing plant. These materials contain sulfur and copper metal, which are susceptible to rapid oxidation with high potential for acid generation and metal leaching.

“This presents a high risk to maintaining the overall chemical stability of the site, which can only be achieved by processing the exposed material,” the plan said.

Regarding the ammonium nitrate present in the mining facilities, the plan stated that “the quantities that will not be used require re-export through contractor Austin Powder.”

Regarding financial aspects, the plan recognized that although Minera Panamá maintains its willingness to execute the safe management plan, “the abrupt cessation of operations implies that income is not generated from its main activity, which will require a conversation with the competent authorities on the ways and means to generate funds to defray the costs associated with PGS activities.”

Official recommendations

MICI also published the report of the intergovernmental inspection regarding the supervision of the orderly closure of the mine on its website. The inspection was carried out on April 3-5 and 10-11, with the participation of the maritime authority, the customs authority, the public works ministry, the environment ministry, MICI, and others.

“During our inspections we were able to corroborate that the company Minera Panamá is not operating commercially and is carrying out minimal maintenance on the different infrastructures of the mine in order to safeguard the environment, its personnel and maintain the different mobile and fixed assets,” the report said.

From the perspective of the intergovernmental commission, the technical solution of the safe management plan and future final closure are linked to the legal part, since the proper implementation of the plan requires a complete processing operation, although it clarifies that new blasting or extraction at the Botija, Colina or other pits are not contemplated.

Among the recommendations by the authorities, “prioritizing the export of stored copper concentrate” to avoid risks and maintain free space to produce sand for the tailings installations stands out.

They also recommend processing the crushed mineral stockpiles to avoid environmental risks and eliminate environmental liabilities. “Ore storage piles must be processed to avoid acid drainage generation (risk of soil contamination – possible aquifers and rivers – streams),” the document said.

The report also said that “a legal regulatory condition must be found that allows minimum activities to begin the closure process, this involves the import of coal, necessary for the export of copper concentrate (132,000t); the processing of the 'stockpile' and its respective production and export of copper concentrate, the stabilization of the tailings dams with material from the processing that is needed.”

“Without these processes, a closure of the Cobre Panamá mine cannot be inferred,” the authorities added.

Financially, “the costs associated with the PGS to the sale of copper concentrate in the gallery will help defray the cost of the development of the PGS and to some extent the closure plan, in addition to minimizing the risks of environmental contamination and future degradation of the copper concentrate, which will affect its sale price,” according to the report.  

President-elect José Raúl Mulino told Colombia's W Radio on Monday that he would be evaluating the possibility of operating the Cobre Panamá mine again, but only to generate the funds necessary for its orderly closure.

“I'm aware that this problem is there and in some way, without affecting our environment and without affecting the political and social tranquility of the country, we must face it. One cannot be so irresponsible as to leave things lying around, especially when the ecological damage can be immense if it's not dealt with urgently,” said Mulino, who will take office on July 1.