October 27, 2009 in Business

Gold Reserve claim in peril

Venezuela preparing to seize mineral deposit
By The Spokesman-Review
 

The Venezuelan government has moved closer to seizing a gold and copper claim owned by Gold Reserve Inc., which last week asked an international arbitrator to determine the amount of potential monetary loss to the Spokane-based company.

Gold Reserve President Doug Belanger said representatives of CVB-Minerven, a government-owned corporation, arrived at the Brisas project office Thursday to lay claim to a mineral deposit that could be worth $5 billion. An arbitration request with the International Centre for Investment Disputes of the World Bank had been filed Wednesday.

Belanger said the CVB officials had no documents to support their claim to Brisas, and they were turned away.

Venezuelan press reports said the property had already been seized – reports Gold Reserve denied Monday.

Belanger said the reports were premature, although he expects the government headed by President Hugo Chavez to follow through on statements it will take control of the Brisas property, as it has other mineral and oil assets in Venezuela.

The president of CVB-Minerven, he noted, is also the South American country’s minister of mines.

Also, about 200 small miners – who can use hydrology to separate minerals from soft clay on the surface but lack technology for a deeper mine – have also showed up on the Brisas property in recent weeks because they have been told the government has taken ownership, Belanger said.

Small mining is illegal, but authorities have done little to intervene, he said.

Belanger said a decision on Gold Reserve’s claim for damages will probably not come until late 2011.

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