10:37 AM EDT, 06/28/2024 (MT Newswires) -- Canadian miner First Quantum Minerals ( FQVLF ) will launch formal arbitration proceedings against Panama in July over the country's decision to close the giant Cobre Panama mine last November, two people familiar with the matter told Reuters, it is reporting Friday.

The report noted the move coincides with the start of a new administration in the Central American country that could determine the future of one of the world's newest and biggest copper mines that had been responsible for 1% of global output prior to being shuttered.

The report also noted First Quantum said in December it had initiated proceedings against Panama at the International Court of Arbitration in Miami, Florida, seeking $20-billion over the shut-down of the mine after the country's Supreme Court declared its contract unconstitutional.

In the initial stage of arbitration, concerned parties negotiate for six months in a bid to avoid moving on to formally launching proceedings. The miner will now go ahead with the next stage of the process, the sources said.

"First Quantum will meet the July 30 deadline of launching a formal arbitration against Panama as it has a fiduciary duty to do so," one of the people with knowledge of the developments said, asking to remain anonymous as they are not authorized to speak to the media.

In response to a Reuters query, First Quantum declined to comment on the arbitration but directed Reuters to its statement on May 6 where the company said it looked forward to a dialog with the new administration.

(Market Chatter news is derived from conversations with market professionals globally, and/or from other media sources. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)

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