CARACAS, Venezuela — Foreign companies abiding by Venezuelan law will not have their mining licenses canceled by the government, a Venezuelan lawmaker said Friday.
Venezuelan President Hugo Chavez said Wednesday that his government had decided to cancel all mining licenses and stop issuing new ones to foreign companies, accusing them of gaining rights to mines and leaving them idle.
Pedro Jimenez, head of the National Assembly’s energy and mines commission, said Friday that only mine concessions considered inactive or in violation of the law would be affected.
“All those local or foreign investors that follow the law will be respected completely,” according to a statement posted on the assembly’s Web site.
The state-owned mining conglomerate Corporacion Venezolana de Guayana, CVG, has been reviewing mining contracts and concessions.
It had not been clear from Chavez’ comments how foreign companies working here under operating contracts with CVG, like Canada-based Crystallex International Corp., would be affected.
Crystallex has been seeking to develop the Las Cristinas mine in east Venezuela believed to hold one of the world’s largest undeveloped gold deposits.
Jimenez indicated Friday that project was not at risk.
“The Las Cristinas project is of vital importance for Venezuela and is needed for the local economy. The project includes a contract with Crystallex and small groups of miners,” the statement notes. “Citizens know that this Canadian company has made efforts to alleviate social tensions in that area,” he added.
Shares of Crystallex and other mining companies had dropped earlier this week after Chavez announced plans to build a new national mining company in Las Cristinas.
The company said Wednesday that its plans remain on track to begin commercial gold production in the second half of next year, at an initial rate of about 300,000 ounces a year. Company officials are awaiting environmental permits that are considered a mere formality.
Environmentalists and indigenous groups have tried to block the mine’s construction in the past, saying the work could cause environmental damage and disturb nearby American Indian communities. Government officials have said there would be minimal environmental damage.
Illegal miners have been extracting gold for decades in the area, located among forests some 750 miles southeast of Caracas, the capital.
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