Franco-Nevada’s Arbitration with Panama Advances as Hopes Rise for Cobre Panama Restart
Arbitration between Franco-Nevada (TSX, NYSE: FNV) and Panama over the fate of the $10 billion Cobre Panama copper mine is progressing, with a tribunal set to hear the case in October 2026.
The dispute follows the 2023 closure of the mine, which forced Franco-Nevada to take a $1 billion impairment charge.
Franco-Nevada had a gold-copper streaming agreement with First Quantum Minerals (TSX: FM), the mine’s owner and operator. The legal uncertainty hasn’t deterred investor optimism, with Franco-Nevada’s stock reaching a 52-week high of C$212 per share and its market capitalization climbing to nearly C$41 billion ($28 billion).
“We are encouraged that President Mulino has expressed a willingness to discuss Cobre Panama this year,” CEO Paul Brink stated while delivering the company’s 2024 full-year results.
First Quantum has also launched a separate $20 billion legal claim against Panama, with hearings postponed to 2026 to allow for potential negotiations.
However, President José Raúl Mulino has made it clear he will not negotiate with First Quantum unless the company withdraws its claim.
Mulino, who visited the mine site in February, acknowledged its economic significance, as it previously contributed 5% of Panama’s GDP and 40% of First Quantum’s revenue.
While he has hinted at exploring “novel ideas” for the mine’s future, his immediate focus is on controversial social security reforms, which remain under debate in Congress.
Before the mine can reopen, Panama would need to lift the open-pit mining moratorium imposed by the previous administration.
However, securing legislative approval may prove challenging, as Mulino’s government faces strong opposition in the National Assembly.
Despite these challenges, the shifting sentiment in Panama has sparked renewed optimism that a resolution could be reached, paving the way for Cobre Panama’s potential return to operation.
