and here come the Reuters spin

CARACAS, April 21 (Reuters) - Canadian junior miner Gold Reserve said on Tuesday it may file an arbitration suit against Venezuela under a bilateral investment treaty for blocking development of a gold mine in the OPEC nation.

Gold Reserve (GRZ.TO) said a May 2008 government decision to revoke a permit for construction at the Brisas gold and copper project led it to alert Venezuela to the existence of a dispute under two investment protection treaties.

"If the dispute is not settled amicably, the Company may file for international arbitration," Gold Reserve said, lamenting a "lack of meaningful dialogue" on the issue.

The Brisas sits next door to the Las Cristinas project. Combined they contain well over 20 million ounces of gold, but the site has been entangled in legal disputes for decades and has not been developed.

Socialist President Hugo Chavez says he wants Las Cristinas to be developed as a joint venture between the government and Russian-owned Rusoro (RML.V), which recently launched a failed hostile takeover bid on Gold reserve.

Chavez has nationalized energy, telecommunications, steel and cement companies since taking office a decade ago. Several companies including oil giant Exxon (XOM.N) have taken Venezuela to court over government takeovers.

Gold Reserve holds the rights to the Brisas and the Choco 5 gold exploration property southern Venezuela, an area that holds some of Latin America's largest gold deposits.