First Quantum shares sink 28 per cent after Panama announces referendum on mine deal

TORONTO — Shares in First Quantum Minerals Ltd. lost more than a quarter of their value on Monday after the president of Panama said over the weekend that he would hold a referendum on a law that cleared the way for the company's Cobre Panama mine.

The vote on whether or not to repeal the law will be held on Dec. 17 and the results will be binding, the president said Sunday.

The decision by the government comes after protesters took to the streets in Panama demanding the government rescind the contract with First Quantum.

The referendum brings fresh uncertainty over the company's operations in the country.

The company and Panama's government reached a deal in March that supposedly ended a long-standing dispute over profit sharing at the mine and included substantially higher payments to Panama. The contract was enacted into law on Oct. 20.

First Quantum shares closed down $7.96, or 28 per cent, at $20 on Monday on the Toronto Stock Exchange and saw more than five times more trading volume than the 90-day average.

This report by The Canadian Press was first published Oct. 30, 2023.

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The Canadian Press