Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: shades who wrote (63941)	6/16/2006 10:56:25 PM
From: shades	Read Replies (1) \| Respond to of 110194

Venezuela To Take Control Of Unproductive Mines (Is this like when they took the farms from whites in africa and starved to death? - Is this much different from Bush renegotiating with gulf oil boys?) By Raul Gallegos Of DOW JONES NEWSWIRES CARACAS (Dow Jones)--Venezuela will take control of all non-producing mining areas, including those that still await production permits, the mining minister said Friday. Minister Victor Alvarez presented an proposed mining law reform to Congress that would recover idle mines so new deals can be negotiated with companies currently in control. The law also allows the government to assign unproductive areas to small-scale miners. The wholesale mining reform is a two-step process beginning with a reform of the existing law, to be followed up with a more comprehensive new law later on. The reform calls for the government to seize all areas that are not producing, with no exceptions. "In many cases the lack of permits is nothing but an excuse to remain idle," Alvarez told reporters during a press briefing in Congress. Under the law change Venezuela will seize non-producing mines and re-negotiate deals or hand the mines over to small-scale miners. The state could also choose to develop specific mines deemed of strategic importance without private sector involvement. The government of President Hugo Chavez wants to convert all idle mine deals into new agreements with a majority stake for the government. Alvarez said the government will favor a joint-venture public-private company when it has the appropriate technology to develop a mine but needs financing. If the government has the money but lacks technology, it will opt for a concession with a foreign operator. The seizures will include old deals and new ones, signed anywhere between 20 years and five years ago, Alvarez said. He declined to address specific cases such as the controversial Las Cristinas gold mine project controlled by Canadian company Crystallex International Corp. (KRY). Crystallex has long argued its operations are safe from any changes to the government's mining policy because it's still waiting for the required permits to begin production at Las Cristinas, one of the largest gold deposits in the world. Crystallex has signed an operating contract with Venezuelan mining conglomerate Corporacion Venezolana de Guayana, CVG, the Andean country's mining conglomerate. Jose Ramon Rivero, a lawmaker that heads the congressional mining subcomission in charge of the law reform, noted that Crystallex could be affected by the law change. "Las Cristinas is not producing, and the Las Brisas project (also controlled by Crystallex) is not producing either," Rivero said. Mines under production won't be touched "such as Hecla (Mining Co. (HL)) and the others in operation," Rivero added. The lawmaker pointed out that once the law changes are approved the government will decide the course of action for each mine on an individual basis. The fact that Crystallex signed an agreement with CVG, "could give the company some leverage in future discussions. In the end any problems will have to be dealt with in the courts," said Rivero. Meanwhile Todd Bruce, president for Crystallex, said this change would have no impact on his company. "The reality is that Las Cristinas is not affected," he told Dow Jones Newswires Friday. "The uncertainty exists more in the media than on the ground in Venezuela." As well as Hecla and Crystallex, a number of other foreign mining companies have a presence in the Venezuelan mining industry, including China's Shandong Gold-Mining Co. (600547.SH), South Africa's Gold Fields (GFI) and Canada's Gold Reserve Inc. (GRZ). Lawmakers made clear they plan to discuss and approve the new law in a matter of one and half months at the very latest. Minister Alvarez insisted the reform is needed to give Venezuel total control over its mining resources and to create jobs in poverty stricken mining regions. Chavez, a leftist leader and avowed Socialist, has promised to transform mining areas into new development hubs where foreign companies and the government can exploit resources responsibly to benefit all Venezuelans. -By Raul Gallegos, Dow Jones Newswires; 58 212 564 1339; raul.gallegos@dowjones.com (END) Dow Jones Newswires June 16, 2006 13:58 ET (17:58 GMT) Copyright (c) 2006 Dow Jones & Company, Inc.- - 01 58 PM EDT 06