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Cobre Panamá, AES sign agreement to supply clean energy from 2024

Bnamericas Published: Tuesday, November 29, 2022
Cobre Panamá, AES sign agreement to supply clean energy from 2024

Copper miner Cobre Panamá and power generator AES Panamá have signed a long-term contract to supply firm power and certified renewable energy from solar, wind and hydroelectric sources to the former's operations starting in January 2024.

The agreement between AES and Cobre Panamá parent company First Quantum Minerals would cover need for more power at the firm's mine in Colón province, providing an additional 64kW, according to the operations superintendent of the Cobre Panamá power plant, Boris Batista.

The agreement was signed by First Quantum Minerals CEO Tristan Pascall and AES Panamá President Miguel Bolinaga, the two companies said Tuesday in a joint statement.

"As a responsible mining company, we recognize our obligation to contribute to the management and mitigation of climate change, and part of our contribution is through a transition to clean energy sources in our operations, including Cobre Panamá," said Pascall.

He stressed that the global need to accelerate the transition to cleaner energy would require increased production of minerals and metals such as copper, used in solar panels, wind farms, and electric vehicles.

"This agreement for the energy transition of our operations is also a logical step to increase the sustainability of our production," added the executive.

Miguel Bolinaga, president of AES Panamá, said that "one of the main goals of AES at a global and local level is to lead the energy transition, which is why for us, offering cleaner energy solutions to our clients is a priority."

Both companies said they would take additional steps to reduce carbon emissions at Cobre Panamá, and 30% of the energy used in Cobre Panamá's operations is expected to come from renewable sources by 2025.

First Quantum Minerals added that it plans to reduce carbon emissions from its global operations by 50% by 2030, according to the statement.

Flagship copper mine

The Cobre Panamá concession, which consists of four areas totaling 13,600ha, involves estimated capex of US$6.5bn and has a useful life of 34 years after starting commercial operations in 2019.

At its current full capacity, the plant can process 85Mt/y (million tonnes per year) of ore for output of over 300,000t/y of copper, along with gold, silver and molybdenum, according to the company. 

Earlier this month, the Panamanian government set December 14, 2022, as the deadline for First Quantum Minerals to ink a long-awaited contract that allows the company to continue running the copper mine.

The Vancouver-based miner has been awaiting the document since September 2021, when it began negotiations with Panama's trade and industry ministry to renew the contract for the mine.

In January, First Quantum agreed to increase its royalty payments for the copper mine to US$375mn a year.

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