Perhaps the world’s richest deposit of arbitration processes

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They say there are 16,860,000 ounces of gold under there

The sprawling farce that is the Las Cristinas gold mine sunk to a new low yesterday, as Rusoro, the Russian firm that had been brought in to take over the mine from the Canadian firm that filed for arbitration after it had been brought in to take over from the other Canadian firm that had filed for arbitration after it had been brought in to take over from yet another Canadian firm whose contract had been irregularly terminated after it had been brought in to take over from the Venezuelan firm that hadn’t managed to exploit the mine after it had finagled control of the mine from the widow of the original concession-holder…itself filed for ICSID arbitration.

Though Rusoro’s claim seeks compensation for the loss of assets beyond just Las Cristinas (including some active mines) this is, nonetheless, the third concurrent ICSID arbitration case Venezuela is facing involving Las Cristinas, by my count. That really must be some sort of record, especially when you consider that as far as I can tell, not a single ounce of gold has been commercially produced there yet.

Forty-eight years and nine concessions into the Venezuelan state’s effort to develop Las Cristinas, the only people who’ve figured out how to extract any value out of the mine are the lawyers…

17 COMMENTS

  1. Just let the gold sit underground waiting for the next generation. Chavez will only use it the create more hell on the planet.

  2. The window for foreign investors to file new arbitration claims expires next Tuesday when Venezuela’s denunciation of the ICSID convention will take place, maybe several companies will be filling for arbitration in this last few days.

  3. I don’t think Rusoro ever officially had rights to Las Cristinas, but otherwise your post is spot on. They were, indeed, mentioned as the heirs apparent of the deposit after Chavez took it from the company whose name I dare not write.

  4. Last we heard is that Citic (China) is getting concession for Cristinas now along with PDVSA. We’ll see how that works out. Chinese completing “mineral mapping” of country, according to Chavez. Rusoro must feel a bit used at this point after saying they were “preferred partner” of Chavez and hoping that Russian ties would protect them. I know Gold Reserve and KRY are having a chuckle at least.

  5. Maybe the whole world should just foreclose on Venezuela. An outside Liquidation Manager will be appointed to run Venezuela until such time as it has satisfied its debts. Call it “Colonialism”, call it what ever you want, but Venezuela doesn’t seem ready for adulthood, just yet.

  6. Gold has been extracted, under its original concession holder, but probably was not reported to/taxed by the Venezuelan Government. I personally knew the principal extractor, who, among other things, had a yacht off Europe, and his lawyer, who had a mansion in La Lagunita with 5 cars and more domestic help. Most if not all gold/diamonds in Venezuela have been extracted “illegally” by small/independent operators in collusion with the GN and assorted politicians.

  7. Ok, things are very much worse under Chavez. Well then, who are the constituency of the PSUV, and are they getting the benefits they expected, or are they just being patient?

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