Cobre Panama restart hopes rise as thousands return to mine

First Quantum Minerals (TSX: FM) has seen a surge in optimism regarding the potential restart of its Cobre Panamá copper mine following meetings between government officials and stakeholders. Commerce and Industries Minister Julio Moltó visited the Donoso, Omar Torrijos Herrera, and La Pintada regions to engage with workers, local authorities, and suppliers, whose suggestions will be taken into consideration by the government's interministerial commission reviewing the mine's future.

Moltó's visit highlighted the significance of the skilled labor force surrounding the Cobre Panamá operation, with 91% of workers being Panamanian and 17% being women. The mine, which previously supported over 3,200 direct jobs and more than 3,000 indirect positions, is now expected to resume processing stockpiled ore. First Quantum restarted one of the mine's three milling trains in May, producing its first concentrate in June, and has processed approximately 2.1 million tonnes of ore, generating around 3,200 tonnes of copper.

With about 38 million tonnes of stockpiled ore remaining, containing an estimated 70,000 tonnes of recoverable copper, First Quantum anticipates that this inventory will sustain processing for roughly 12 months at the current rate. Once all agreements and approvals are secured, the company estimates that Cobre Panamá could reach 80% to 90% of its capacity within six to nine months.

The mine's restart has crucial implications for Panama, which saw a 4.5% decline in GDP and a reduction of more than 1% in global copper supply following its shutdown in late 2023. President José Raúl Mulino's administration has taken steps to unlock the mine's potential, including suspending the company's $20 billion arbitration claim and permitting the sale of stockpiled concentrate.