Mining Royalties in Panama
Tuesday, March 6, 2012
As gold becomes an important export item, royalties paid by mining companies remain low.
Gold exports rose by 63% between 2010 and 2011, reaching $85.1 million last year. Petaquilla Gold, owner of the Molejon mine, became the largest exporter in the country.

With the growth of the industry, questions are being asked about the royalties paid to the Panamanian government by these mining companies, currently set at 2% of sales. Davidken Studnicki-Gizbert, an expert in the mining history of Latin America and North America, notes that each ounce of gold costs between $250 and $350 and sells at over $1,500, so a 2% royalty becomes "questionable."

In Chile, for example, royalties are between 4% and 9% of sales, and are due to rise to between 5% and 14% from 2018.

When attempts were made to amend the Code of Mineral Resources in 2011, Petaquilla Gold said it was willing to discuss an increase in royalties, to a possible 4%. "In practice, in 2010, after turning over some $65 million, the firm would have paid $1.3 million to the state in mining royalties," at the current rate of 2%.
Source:laestrella.com.pa
Source:laestrella.com.pa
More on this topic
Guatemala: Mining Project Raises Royalties to 5%
April 2013
The San Rafael mining company will contribute 5% royalties to the departments of Santa Rosa and Japala, amounting to more than $80 million annually in taxes and profits for the country.
After several months of conflicts the mining company San Rafael, which is expected to start exploiting minerals later this year, and these two departments have reached an agreement.
Guatemala: Gold, silver mines to pay royalties of 4%
January 2012
The agreement signed by 22 companies in the extractive industry will mean an increase in annual revenues from mining royalties of about $64 million.
Having previously paid 1% in royalties, gold and silver mining companies will pay the Guatemalan state a rate of 4%, said the President Otto Perez Molina.
Mining Royalties to be Voluntary
January 2012
The establishment of the royalties paid by mining companies will not be subject to law, but the product of voluntary agreements between the government of Guatemala and those companies.
After negotiations with the industry, officials from the Ministry of Energy and Mines signed agreements with mining companies to increase royalty payments.
Minera Panama Will Only Pay 2% Royalty
May 2011
The Canadian company Minera Panama, SA announced that it will only pay a 2% royalty on profits to the Panamanian State.
The official response from the company was given last week, after several months of discussion with the current government, including after bringing up in the reform of the Mineral Resources Code (last February) the possibility of upgrading the royalties from 2% to 4%.
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Petaquilla Gold Minera Panamá Ernest MastCarlos Salazar Daviken Studnicki-Gizbert
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