The Environmental Advocacy Center (CIAM), an environmental organization, said today that a ruling by the Supreme Court of Panama leads to the cancellation of a mining concession granted more than 20 years ago, and that after successive sales manages the company Minera Panama with more than 6,000 million dollars in investments.
"This ruling implies that the extension granted to Minera Panama is null and void because the secondary aspect follows the fate of the main thing: which means that all contracts and concessions of a different nature that Minera Panama has obtained under the protection of Law 9 of February 26, 1997, must be declared null also, "the NGO said in a statement Monday.
It explained that the Supreme Court of Justice notified on Monday that it ruled in favor of the organization and declared unconstitutional the "Contract Law 9 of February 26, 1997" which approves the contract between the State and the company Petaquilla Minera, in response to an Appeal of Inconstitutionality filed by the Environmental Advocacy Center of Panama".
"This decision is a victory for the environment even when it took nine years to materialize, during which the rights of the affiliated and concession companies have been sold and transferred many times," said the center, which filed the unconstitutionality claim in 2009.
The Panamanian State and Minera Petaquilla (Canadian) signed in 1997 a concession contract for the extraction of gold, copper and other minerals in the Petaquilla area, a hill located in the district of Donoso, in the Caribbean province of Colón, according to official information.
"This was an example of a leonine (abusive) contract that harmed the Panamanian state and its inhabitants," said the NGO on Monday in its statement, signed by its executive director, Sonia Montenegro, among others.
The concession granted to Minera Petaquilla, now Minera Panama, expired in February of last year, but the current government decided to extend it for another 20 years, until February 28, 2037, as published in the official Gazette.
The contract established that the company could request two consecutive extensions of the contract for 20 years each, as long as the request was filed with the Ministry of Commerce and Industries (Mici) 120 days before or 120 days after the end of each period.
"The objective of the unconstitutionality action was to prevent damage to the ecosystems of Donoso, in Colón, as well as implement correct environmental management, but it is still possible to avoid further damage," the environmental NGO said.
Official sources interviewed by Efe said that legal departments were analyzing the ruling of the Supreme Court, which is in the notification phase to the parties.
Private lawyers interviewed by Efe refused to comment on the scope of the ruling, because they did not know its terms, although they pointed out that it will depend on how the rights derived from the concession were transferred.
The center also requested a mining moratorium nationwide that allows mining concessions "to be adequate to current environmental regulations and transparency" and that "true audit processes" be carried out.
Minera Panamá, a subsidiary of Canadian multinational First Quantum Minerals, has 80 percent of shares in the Cobre Panama project, located in the district of Donoso, in the Caribbean province of Colón.
That copper mine is expected to start operating later this year and it has invested more than 6,300 million dollars. The company is including the export of some 320,000 metric tons of copper per year.
The mining sector represents 2.5 percent of Panama's gross domestic product (GDP), but the country's Mining Chamber estimates that it will reach 9.5 percent when Donoso begins its copper exploitation.