Chavez threatens to nationalise gold mines

Associated Press | Mon, 26 Apr 2010 12:55

[miningmx.com] -- President Hugo Chavez threatened on Sunday to nationalise gold mining concessions in Venezuela, accusing mining companies of damaging the environment and violating workers' rights.

The socialist leader called the holders of gold mining concessions "crazy people" driven by capitalist greed who don't care about laying waste to Venezuela's pristine jungles while exploiting employees.

"We cannot allow national and transnational mafias to continue destroying our homeland," he said during his weekly television and radio program, "Hello President."

Chavez, who has nationalised businesses in the steel, telecommunications, electricity, cement and oil sectors, suggested gold mining concessions could be revoked and seized by the state.

Mining companies have previously denied violating environmental regulations.

Chavez's government has repeatedly clashed with international and national gold-mining companies in recent years over permits to operate in the South American country's southeastern regions, which are rich in gold and diamonds.

Private gold mining, meanwhile, has become increasingly uncertain as Chavez has vowed to assert greater state control over Venezuela's mineral resources to supplement the nation's income from the dominant oil industry.

Last year, the government seized control of a gold mine operated by US mining company Gold Reserve Inc. The project was part of the Washington-based company's larger Brisas mine, which holds an estimated 10.2 million ounces of gold.

In 2008, Crystallex International Corp of Toronto said the Environment Ministry had denied it a permit for its Las Cristinas gold mine. The company estimates Las Cristinas - in the Imataca Forest - holds about 17 million ounces of gold.

Chavez also criticised illegal wildcat miners Sunday, saying they, too, wreak havoc on the environment. The independent miners use mercury to separate gold from rocks and often dump leftover mercury into rivers. They also use huge hoses to break soil away from the roots of trees, which are overturned as a result.

"This is a crime that we cannot continue permitting," Chavez said, then issued an order for military commanders to send soldiers into affected regions.

"We will have to stop it," he concluded.