After weeks of crippling protests sparked by concerns over the mine's environmental impact, Panama's Supreme Court on Tuesday ruled as unconstitutional a contract allowing it to continue operating the Cobre Panama mine.
In a statement, First Quantum said its subsidiary Minera Panama (MPSA) had initiated proceedings before the International Court of Arbitration "to protect its rights under the 2023 concession agreement that the Government of Panama agreed to earlier this year."
The arbitration will take place in Miami, Florida.
Panama faced nationwide protests and roadblocks since Congress approved a law in October allowing First Quantum Minerals to operate the mine for another 20 years, with an option to extend for another two decades.
The protests against the mine agreement were the largest since the fall of dictator Manuel Antonio Noriega in 1989. Roadblocks, including of the Pan-American Highway, led to more than $1.7 billion in losses, according to business associations.
Critics say Central America's largest open-pit copper mine has wrought destruction on forest areas in a biological corridor linking Central America and Mexico.
The Supreme Court had declared the original mining contract unconstitutional in 2017, but the government said a new deal set out a minimum annual contribution from the company to the state of $375 million -- 10 times more than initially agreed.
In addition, the company and the government underscored that the mine generated 8,000 direct and 40,000 indirect jobs.
Since February 2019, the open-pit mine has been producing about 300,000 tons of copper concentrate per year, representing 75 percent of the country's exports and about five percent of GDP.
After the contract was invalidated by the Supreme Court on Tuesday, the government said it would close the mine.
The road blockades were subsequently lifted.
Panama's commerce and industry minister Federico Alfaro Boyd, responsible for negotiations with the Canadian company, resigned Thursday warning the Supreme Court ruling could "have serious consequences for the country."
First Quantum Minerals has invested more than $10 billion in Panama.
On Thursday, First Quantum asked Panama's government to suspend the contracts of some 7,000 workers at the mine.
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