President of Panama Enacts Indefinite Halt on Issuing New Mining Permits; Canadian Operated Mine Remains Exempt

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The head of state in Panama, President Laurentino Cortizo, has enacted legislation imposing an indefinite halt on the issuance of new mining permits. This legislation also includes a clause preventing the renewal of current mining permits.

The legislative body of Panama, the National Assembly, gave its endorsement to the legislation on Thursday, with one exception: the withdrawal of a contentious clause that would have terminated an existing mining agreement. This decision followed two weeks of widespread demonstrations across the nation.

Despite the moratorium, the law will not affect the ongoing operations of the copper mine managed by Minera Panama, located in the Colon region. This concession grants the mine a two-decade operational period with a potential renewal for an additional 20 years.

Environmental advocates have raised concerns that the mine’s activities pose significant risks to the local ecosystem, particularly the destruction of the dense jungle in its vicinity and potential contamination of water sources utilized by local communities.

Minera Panama operates as a subsidiary within the jurisdiction of Panama and is owned by the Canadian corporation First Quantum Minerals Ltd.

The legislation has been met with approval from certain legal professionals who caution that the annulment of the existing contract could expose the Panamanian government to substantial financial liabilities from legal challenges.

Nevertheless, specialists have indicated the potential for these liabilities to be mitigated should the Supreme Court of Panama declare the initial contract unconstitutional. There are currently eight cases challenging the contract on these grounds.

There is a pending legislative proposal which, if debated and passed, would subject the said mining contract to a national referendum.

President Cortizo’s ratification of the mining contract occurred on October 20, despite the ongoing civil unrest.

The protests persisted on Friday, garnering participation from diverse societal segments, including Indigenous communities, and various professional unions from sectors such as education, construction, and healthcare.

A notable precedent in the region was set in 2017 when the Salvadoran congress legislated a comprehensive prohibition on metal mining within the nation, a pioneering move aimed at safeguarding the nation’s water reserves.

Frequently Asked Questions (FAQs) about Panama mining moratorium

More about Panama mining moratorium

• Panama Mining Moratorium
• Minera Panama Copper Mine Operations
• Environmental Impact of Mining in Panama
• Legal Implications of Mining Contracts in Panama
• Supreme Court Challenges Against Panama Mining Deal
• Proposed Referendum on Panama Mining Contract
• Nationwide Protests in Panama
• El Salvador’s Metal Mining Ban