Caracas shuns gold firm as state pushes forward with development

Original source:

Venezuela has refused to renew a gold concession held by the US Gold Reserve corporation as the government boosts state control over its mineral wealth.

According to Wednesday's edition of Venezuela's Official Gazette, the Mining Ministry rejected the company's request to extend the contract for its Brisas del Cuyuni project, part of its larger Brisas mine in southern Bolivar state.

The concession expired in April 2008 and has since been under review.

Gold Reserve claims that the rejection violates Venezuelan law, which requires the government to reply to concession requests within six months.

The firm maintains that it first sought an extension in late 2007, but received no reply until this week.

Gold Reserve is based in Spokane, Washington, but its mines are all in Venezuela.

Venezuelan President Hugo Chavez has vowed to boost state control over mineral resources as part of efforts to build an industrial complex that will reduce the country's reliance on oil exports.

Last May, Caracas denied Toronto-based Crystallex International Corporation a final permit to start digging at the country's largest gold mine Las Cristinas.

And in January, Mr Chavez announced that Venrus, a joint enterprise formed between the Russian-financed Rusoro Mining Ltd and a Venezuelan state holding company, would develop the mine.