A brewing economic storm and an oil economic boom turned bust has accelerated President Hugo Chavez's bluster y rhetoric calling to for the state to mine the Las Cristinas and Las Brisas gold deposits economically and politically to help fund his socialism revolution.
Chavez wants gold mining and other commodity exports to compensate for falling oil prices. Oil comprised 93% of Venezuela's export earnings last year.
Speaking on state television Chavez said, The Venezuelan state is getting ready this year for the exploitation and control of the gold deposit Las Cristinas.
In a statement Wednesday, Las Cristinas parent Crystallex International once again reiterated its usual stance that the company has not been notified of any changes in position by the Venezuelan Government regarding the Las Cristinas Project or its mine operating contract.
However, officials for Gold Reserve said they would consider an offer by the Venezuelan Government or its joint venture partner for its neighboring Las Brisas gold project.
In a statement also issued Wednesday, Gold Reserve officials noted that Chavez has also referred to the formation of VENRUS CA, a joint venture between Rusoro Mining and the Venezuelan Government, which would reportedly develop both Las Cristinas and Las Brisas.
In the event that the government of Venezuela decides to proceed in this manner, Gold Reserve believes that it has alternatives to realize considerable value to its Brisas investment, the statement said. Gold Reserve could entertain an offer from the Venezuelan Government or its joint venture partner to purchase the company's assets and proprietary work.
Gold Reserve suggested that an adequate purchase amount for Las Brisas would be beneficial in the near term to Gold Reserve and save the purchaser several years of time in duplicating our work.
Nevertheless the Spokane-based junior company warned, If a mutually agreeable purchase price could not be determined or other satisfactory resolution is not found then Gold Reserve has remedies to protect its investment in Brisas under Venezuela's domestic legal system, or under bilateral investment treating to which Venezuela is a part. In the case of accessing bilateral investment treaties, Gold Reserve would seek the recovery of its US$230 million investment, plus potential lost profits of several US $ billion.
Gold Reserve again stressed that the value of Rusoro's proposed hostile takeover of Gold Reserve is substantially less than the value of the company's net cash, equipment and Brisas investment.