Canadian miner First Quantum Minerals on Thursday announced the suspension of ore processing operations at its Cobre Panamá mine, citing the Panamá Maritime Authority’s (AMP’s) refusal to permit copper concentrate exports at the mine’s port.

First Quantum’s local subsidiary, Minera Panama, will begin a partial demobilisation of its workforce of more than 8 000 employees and contractors, on whom the impact is expected to increase significantly in the coming weeks if concentrate shipments do not resume, the company said in a statement.

In addition to workforce reductions, the mine has ceased purchasing supplies and services that are equivalent to $20-million in weekly revenues to more than 2 000 Panamanian companies.

The AMP on January 26 ordered Minera Panama to suspend loading operations at Punta Rincon, citing a certification issue. The blocking of exports from the Cobre Panama mine came as a contract dispute between the government and the company over royalties and tax reached a stalemate.

The AMP has issued individual letters to First Quantum’s maritime pilot service providers instructing them not to provide services to incoming vessels for loading copper concentrate at the port.

On Thursday, Panama's Ministry of Commerce and Industries accused Minera Panama of failing to demonstrate its commitment to holding talks on good faith and trust.

"They have not honored their word and refuse to sign the agreement with the previously accepted terms, instead engaging in delay tactics that have lengthened the process for more than a year, seeking to change the agreement so the government of Panama does not receive the fair compensation it deserves for its natural resources, thereby acting against the interests of the Panamanian people and the workers of the Cobre Panama mine," the government said.

The government said First Quantum should "refrain from creating unrest and uncertainty about the stability of the thousands of workers and suppliers who depend on the mining activity".

"Using pressure mechanisms does not contribute to improving the levels of understanding that both the government and Minera Panema require for a fair, balanced and satisfactory relationship of both national interests and foreign investment."