An anonymous director reports

FIRST QUANTUM COMMENTS ON DEVELOPMENTS IN PANAMA

First Quantum Minerals Ltd. has noted comments made by the President of Panama, Laurentino Cortizo, that on publishing of the Supreme Court of Panama's ruling of Law 406 as unconstitutional, there will be a transition process for the closure of the Cobre Panama mine. Minera Panama SA (MPSA), a subsidiary of First Quantum, is currently seeking additional details in respect of the ruling and its implications. With these developments, the company is suspending its production guidance for Cobre Panama for the current year.

The court's decision does not take into account a planned and managed closure scenario, in which key environmental measures are required to be implemented to maintain the environmental safety of the site during this process. Typically, this would involve the development of environmental controls to ensure the long-term physical and chemical stability of all infrastructure under current and extreme climatic conditions to avoid long-term environmental impact. Some of these environmental requirements requiring clarification include the government's plan for the management of the tailings storage and water treatment facilities to preserve water quality, maintain safety and prevent failure. Furthermore, the future of Cobre Panama's rehabilitation, reforestation and species conservation programs, as well as protection of almost 20 per cent of Panama's total protected areas, currently funded by Cobre Panama will need to be addressed.

On Nov. 14, First Quantum submitted to the Ministry of Commerce and Industry of Panama a notice of intent to initiate arbitration to enforce its rights under international law pursuant to the Canada-Panama Free Trade Agreement. The notice of intent facilitates consultations between the government of Panama and MPSA under the Free Trade Agreement in order to avoid the need to file any such arbitration.

Furthermore, on Nov. 29, MPSA initiated arbitration before the International Court of Arbitration (ICC) to protect its rights under the 2023 concession agreement that the government of Panama agreed to earlier this year. The arbitration agreement provides for arbitration in Miami, Fla.

First Quantum, through Cobre Panama, reiterates that transparency and compliance with the law have always been fundamental for the development of its operations and remains open to constructive dialogue in order to reach consensus.

Further information about Cobre Panama

For the past 25 years, MPSA has developed and operated the Cobre Panama mine. The development of the mine has been governed by a concession agreement contract first signed by Panama and MPSA in February, 1996, and approved by Law 9 by the National Assembly in February, 1997. On the basis of that contract, Cobre Panama has invested $10-billion (U.S.) in the mine and associated infrastructure, including a power plant, cross-country transmission lines, roads and a port.

Cobre Panama has also developed substantial community outreach and environmental mitigation programs, both during the construction phase of the mine and since commercial operations commenced in September, 2019. The mine is governed by an environmental and social impact assessment approval which stipulates 371 obligations in regard to stewardship of the mine, communities and the environment; for example, the requirement to provide continuing reforestation of 11,175 hectares of forest in Panama. To date, the mine has impacted around 3,000 hectares for mining activities whilst it has completed reforestation of approximately 4,200 hectares throughout Panama, and provides support programs for more than 200,000 hectares of protected areas, almost 20 per cent of Panama's total protected areas.

Following a Supreme Court decision in late 2017 and at the request of Panama, MPSA engaged in an extensive process to renegotiate the terms of the concession agreement, which took more than two years. The company and Panama agreed to a new concession agreement contract in March, 2023, which, following due public consultation and regulatory sign-off, was approved by Law 406 by the National Assembly on Oct. 20, 2023.

We seek Safe Harbor.