Shandong Gold, Minerven in talks for Sosa Méndez mine - Venezuela

Friday, September 5, 2008

China's Shandong Gold and Venezuelan state company Minerven are close to reaching an agreement to return control of the Sosa Méndez gold mine to the Venezuelan state, a union leader told BNamericas.

"The Chinese executives did not comply with agreements or Venezuelan law. They also did not discuss a collective contract and now they've decided to go," the administrative union coordinator in Venezuela's Guayana region, Douglas Coriano, said.

However, a Minerven spokesperson said nothing official had been decided on the issue. "They are talking and in the process of making a transfer but there are no concrete details," the spokesperson said.

Minerven and Shandong Gold formed the company Venezuela Ordaz Jinyan in 2004 to reactivate the Sosa Méndez mine in southeastern city El Callao. The mine had been inactive for roughly 46 years.

The Chinese company's decision may be due to low gold output at the mine in recent months and "it's practically a given that the mine will pass into Minerven's hands," Coriano said.

For now, reports suggest that the mine will be operated in equal parts by Minerven and Canada's Rusoro Mining (TSX-V: RML).

The 500t/d Sosa Méndez mine required investments of US$12mn and has reserves of 915,000t grading 12g/t gold.

Harvey Beltrán
Business News Americas