Central America

Central America’s biggest mine faces closure over tax spat

Photo: Luis Acosta / AFP

| By AFP | Francisco Jara |

Rising up through the lush vegetation of Panama’s Caribbean coast, a 125-meter chimney serves as a beacon for helicopters approaching the largest mine in Central America, which faces closure next week over a contract dispute.

Gigantic 400-tonne trucks slowly wind around the stepped slopes of a massive gash in the earth one kilometer wide, the ochre and grey of the copper mine standing in stark contrast to the verdant jungle surrounding it.

The activity could grind to an expensive halt in a matter of days.

Canadian mining giant First Quantum Minerals has until next Wednesday to sign a new contract with the government, which is demanding the company multiply the taxes it pays by 10.

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If the parties do not agree, the disagreement could halt the work of a mining project considered the largest private investment in Panama’s history, contributing four percent of the country’s GDP and 75 percent of export revenues.

“We have been given a deadline to sign the new contract by December 14, to accept the new terms,” First Quantum’s manager in Panama, Keith Green, who is Scottish, told AFP.

“We intend to reach an agreement, but negotiations are a bit deadlocked,” he added.

First Quantum, one of the largest copper miners in the world, began commercial copper production at the site in Donoso in 2019, through its subsidiary Minera Panama.

It has spent $10 billion on earthworks, construction buildings to house more than 7,000 employees, the purchase of heavy machinery, a power plant, a port for deep-draft merchant ships, access roads, and re-forestation plans.

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‘Fair income’

President Laurentino Cortizo in January announced plans to toughen the conditions of the mining license, with a new contract that would oblige the mining company to pay “at least” $375 million to Panama annually — ten times what it is currently paying.

“Panama has the inalienable right to receive fair income from the extraction of its mineral resources, because the copper is Panamanian,” he said.

This mine is “the biggest in Central America,” producing 300,000 tons of copper concentrate per year, said Green.

The deposit, discovered in 1968, lies on the Caribbean coast, 240 kilometers by road from the capital Panama City.

The company, listed on the Toronto Stock Exchange, built the Punta Rincon International Port next to the mine to transport the copper by ship, due to a lack of roads connecting the Colon port, 40 kilometers (25 miles) away.

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Despite the uncertainty over the mine’s future, activity has not slowed and the company has continued to invest in the site.

A new 200-tonne drilling rig — as tall as a three-story building — was inaugurated in a ceremony on Tuesday, causing heavy air traffic.

Helicopter pilot Oldemar Arauz explains that most officials visiting the mine prefer the one-hour air trip to the four-hour drive on a narrow road from the capital.

The drilling rig, made in the United States by the Swedish company Epiroc, cost $6 million, and was transported to the mine in 10 trucks.

“Latin America has 200 of these drills, 50 in Chile and now three in Panama,” said Epiroc’s Latin America manager Hans Traub.

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The drill was assembled by Chilean engineer Alex Gonzalez, who previously worked in Chuquicamata, the world’s largest open pit copper mine, situated in the Atacama desert, which has been operating since 1915.

Central America does not have the same mining tradition seen further south. Mining is illegal in Costa Rica and El Salvador, and while there is much potential for growth in Panama, the industry’s future is now hanging in the balance.

Related Topics:Central America Mine Panamá

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Central America

Guatemala prison uprisings leave 46 guards held by gangs

Gang members staged riots, took prison guards hostage and set fires on Saturday at several prisons in Guatemala, in protest over the transfer of their leaders to a maximum-security facility and the implementation of new confinement measures, authorities said.

The Barrio 18 and Mara Salvatrucha (MS-13) gangs — both designated as terrorist organizations by the United States and Guatemala — are accused of contract killings, extortion and drug trafficking. Guatemala’s Minister of the Interior, Marco Antonio Villeda, confirmed that the unrest affected three prison facilities.

Villeda said the riots did not result in any fatalities or injuries, but 46 prison guards are currently being held hostage by gang members.

The minister stated that the government is willing to engage in dialogue to secure the release of the detained personnel, regain control of the prison facilities and ensure that inmates submit to internal regulations and the rule of law.

“Dialogue, not negotiation. We are dealing with terrorist structures that are financed and well organized. These are terrorist groups with whom we will not negotiate. The State is acting with legitimacy and in accordance with the law,” Villeda said.

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According to official figures, 18 guards are being held at the Renovación 1 prison and the Preventive Detention Center for Men in Zone 18 — nine at each facility — while another 28 guards are hostages at the Fraijanes 2 prison.

Villeda acknowledged that all three prisons remain under gang control, but stressed that authorities are prioritizing the safety of those being held. “We will guarantee their lives and respect for them. We will take whatever time is necessary to retake control of the prisons,” he said.

The minister also warned that the prison riots are part of what he described as an “orchestrated plan,” which has included road blockades in other parts of the country and the destruction of penitentiary infrastructure and records.

Central America

Bukele warns crime can become a ‘parallel government’ during visit to Costa Rica

El Salvador’s President Nayib Bukele, accompanied by his official delegation, arrived at the site where the new facilities of the Center for the High Containment of Organized Crime (CACCO) are being built. Costa Rican President Rodrigo Chaves welcomed Bukele, marking the start of the cornerstone-laying ceremony.

“Thank you very much to President Rodrigo Chaves and his cabinet for this invitation,” Bukele said, noting that this was his fourth meeting with the Costa Rican leader in the past two years.

In his address, Bukele stressed that insecurity is a problem that undermines all aspects of society. “When insecurity advances, jobs collapse, education becomes more difficult, and the economy slows down. People stop going out, businesses close early, investment leaves, and tourism disappears,” he said.

The Salvadoran president warned that if crime continues to grow, it can turn into a parallel government—“the dictatorship of gangs, criminals, and drug traffickers.” He added that this situation has not yet occurred in Costa Rica and that the country is still in time to prevent it.

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Central America

U.S. and El Salvador maintain close partnership, embassy says

The Chargé d’Affaires of the United States Embassy in El Salvador, Naomi Fellows, said on Monday that relations between the two countries remain “very close” and that both governments continue to work together in several areas of shared interest.

Speaking at a press conference, Fellows highlighted the longstanding friendship between the United States and El Salvador, as well as the achievements reached through bilateral agreements.

“In terms of our relationship with El Salvador, it continues to be very strong, very close. We are partners on security issues, on economic development; partners on migration, and on many other matters,” she said.

Fellows added that the relationship remains solid and is expected to continue strengthening through joint actions and cooperation initiatives.

On security, she noted that the administration of U.S. President Donald Trump has underscored the results of the measures implemented by the government of President Nayib Bukele to improve public safety in the country.

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Senior U.S. officials have visited El Salvador to observe firsthand the impact of the Territorial Control Plan, including tours of the Terrorism Confinement Center (CECOT).

Fellows also emphasized the strong personal ties between the two nations, pointing to family and friendship connections that link Salvadorans and Americans.