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Canadian government aims to support First Quantum after mine closure, minister says

Reuters | February 6, 2024 |

Cobre Panama copper mine. (Image courtesy of Franco-Nevada assets handbook.)

The Canadian government will do its best to support First Quantum Minerals, the trade minister said on Tuesday without elaborating, as the Canadian miner deals with the fallout from the closure of its flagship copper mine in Panama.


“First Quantum Minerals is a really important Canadian company,” Trade Minister Mary Ng told reporters in Ottawa.


“I’ve met with them, I continue to meet with them, and really, I’m really looking to supporting the Canadian company … as best as we can,” Ng said.

Large protests erupted last year against First Quantum’s contract to operate a lucrative Cobre Panama mine that was approved by the Panama government in October. Protesters argued it was too favorable to the Vancouver-based company.

In November, the Central American country’s top court ruled the contract unconstitutional, prompting the government to order the mine to shut down.

The Panama copper mine accounted for about 40% of First Quantum’s revenue and its closure led to a near-halving of the company’s market value.

First Quantum is now exploring options to “manage its balance sheet,” which include selling smaller mines, bringing strategic investors into its larger mines and evaluating ways to raise funds. It has also initiated international arbitration over the contested Cobre Panama contract.

Ng said Ottawa was monitoring the situation closely and she had been in contact with her Panamanian counterpart about First Quantum.

“I will stand up for Canadian companies where they operate, and First Quantum has operated in Panama for many years,” Ng said.

(By Ismail Shakil; Editing by Deepa Babington)

France extends New Caledonia nickel rescue talks

Reuters | February 5, 2024 |

Credit: Eramet

France will continue talks until the end of February to save New Caledonia’s nickel industry, the finance ministry said on Monday, after failing to reach a deal last month to fill a massive funding shortfall for the territory’s nickel processors.


New Caledonia has some of the world’s largest nickel reserves but high costs and political tensions in the French-controlled Pacific territory have left its three processing plants on the verge of collapse.


The French government has held talks on nickel in parallel to wider political negotiations with pro-independence and loyalist political parties. Finance Minister Bruno Le Maire said in late November he wanted a nickel deal by the end of January.

“The talks will continue until the end of this month,” a finance ministry spokesperson said, adding: “Later than that is not possible because the financing needs are immediate.”

Le Maire has estimated at 1.5 billion euros ($1.61 billion) the short-term financing needs of New Caledonia’s three nickel processing groups – SLN, KNS and Prony Resources.

Commodities group Glencore, which co-owns KNS, has said it will only provide funding for the firm until the end of February, while French miner Eramet has repeatedly said it will not provide more funding for SLN, in which it holds a majority stake.

A working group of political and industry representatives that has led the negotiations said in a progress report last month that falling nickel prices meant measures proposed so far still left a significant funding gap for 2024.

It called on current shareholders to consider extra financing.

Prony Resources, meanwhile, said in a statement last month it was seeking “a core shareholder” to boost its financing.

Prony has a number of minority shareholders including commodity merchant Trafigura with a 19% stake.

Glencore, Eramet and Trafigura each declined to comment on the talks.

Discussions have sought to address the unprofitability of nickel processing in New Caledonia through plans to improve mining productivity and subsidise energy costs.

The French government’s representative in New Caledonia last week said an emergency loan for the processing firms was also under discussion.

($1 = 0.9314 euros)

(By Gus Trompiz, Clara Denina and Melanie Burton; Editing by David Gregorio)