Next Chinese #gold target - #Venezuela`s huge Las Cristinas project Mineweb.com

Citic to develop the massive and frequently disputed, Las Cristinas gold mine. #GOLD NEWS 

Next Chinese gold target - Venezuela's huge Las Cristinas project

China has entered into a number of resource related deals with the Venezuelan government, key among which is for Citic to develop the massive and frequently disputed, Las Cristinas gold mine.

Posted: Monday , 24 Sep 2012
LONDON (Mineweb) -  Author: Lawrence Williams

Initially Chinese investment in foreign mining operations was largely focused on industrial metals - securing supplies to feed its huge industrial machine - but of late the emphasis on buying into mining outside the Middle Kingdom seems to have switched to gold.  Seemingly in quick succession we have seen Chinese companies moving into Norton Gold Fields, African Barrick and Focus Minerals, but now one of the biggest prizes of all looks to have also fallen into Chinese hands - the huge Las Cristinas gold deposit in Venezuela.Las Cristinas, which is considered to be one of the world's great undeveloped gold deposits, is to be developed by China International Trust and Investment Corp. (Citic) as one of a series of deals signed between Chinese and Venezuelan officials on Friday.
According to an Associated Press report, Venezuela's President Chavez announced the deal, although no financial details were given.  It was reported to specify engineering, construction and processing of the gold and associated copper in the deposit which is conservatively estimated to contain reserves of some 17 million ounces of gold (a reserve calculated at around $550 an ounce in 2008).  Chavez, not one short on hyperbole, called it "one of the biggest resources of gold that exists - not only in Venezuela, not only in Latin America, but in the world."
Las Cristinas has had a chequered history though and some consider the deposit cursed in that virtually every claim on it since its discovery has fallen through due to legal challenges, financial manoeuvrings and protracted disputes with Venezuelan government agencies and the country's President. It was originally supposed to have been given to the pilots who discovered the Angel Falls. After passing through a number of hands, including then mining major, Placer Dome (later taken over by Barrick Gold) ownership eventually ended up with Canadian junior Crystallex International which started to develop it, but was continually thwarted in its aims by the Chavez government which would not grant the necessary final permits for the mine's construction, and eventually effectively expropriated it.  (More details on the series of ownership changes and the problems faced by those who may have seemed to have gained title to the project were published here last November - see The curse of Las Cristinas. Gold miner Crystallex faces TSX delisting).
Crystallex has since sought international arbitration before the Additional Facility of the World Bank's International Centre for Settlement of Investment Disputes against the Venezuela Government.  It is seeking the restitution of its investments and the Mine Operating Contract and compensation for interim losses suffered, or, alternatively full compensation for the value of its investment in an amount in excess ofUS$3.8 billion.
The Venezuelan agreement with Citic certainly suggests that the restitution of the Mine Operating Contract is already a lost cause and even if the arbitrators find in Crystallex's favour, whether a Chavez government would be prepared to recognise the court's jurisdiction and/or honour anything but a trivial compensation award could be seen as doubtful.

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Junior miners suffer financing drought | CanadianBusiness.com

80% of Canadian mining companies are struggling to raise capital - PDAC

Junior miners suffer financing drought

By Matthew McClearn  | September 20, 2012

  inS

(Photo: John Lehmann/Canadian Press)

Junior mining companies, for which Vancouver is a global hub, tend to swing to extremes. Buoyed by a commodities supercycle, a year ago even sketchier explorers could obtain financing on favourable terms. Today the entire sector is parched for capital as continuing turmoil in Europe and risk aversion throttle equity and debt markets. The Prospectors and Developers Association of Canada estimates 80% of Canadian mining companies are struggling to raise capital.
“Some juniors are still trying to raise money in the market, but at a reduced share price,” says Gavin Dirom, president and CEO of the Association for Mineral Exploration British Columbia. “Others have been able to build up enough resources in the prior year or two and weather the storm. Some are reducing the scope of work and trimming budgets.”
Junior miners seldom can rely on banks to see them through tough times. They instead traditionally turn to resource-centered mutual funds, strong-stomached private investors and boutique investment banks. This time companies are said to be turning to other sources, too, like Asian sovereign wealth funds.
The Halifax-based Metals Economics Group sees no relief this year. Analyst Justin Desrochers says that given the recent lull in bad news from Europe and the U.S., he sees light at the end of the tunnel. But it may not come soon enough. “A lot of juniors will try to raise money at the end of a calendar year when they have their exploration results from the summer in hand,” he says. “I don’t know if that’s going to happen this year.”

Junior miners suffer financing drought | CanadianBusiness.com

Coal in China

Analysis

Coal is at the center of modern Chinese history. Without it, China's industrialization and massive economic growth over the past three decades -- which relied heavily on nearly unlimited access to cheap, domestically sourced coal -- would have been much smaller. Changes in the geography and structure of coal production, from the decentralization of the 1980s and 1990s to the current increase in centralization, reflect and shape changes in the Chinese political system. Over the past decade, as coal reserves in China's traditional mining hubs in the northeast and the central plains began declining, the bulk of new coal production and exploration has shifted westward to the sparsely populated provinces of Inner Mongolia, Ningxia, Gansu and Xinjiang. But as coal production moves away from traditional mining centers in provinces such as Henan, Shandong and Hebei, the construction of extensive new rail systems -- the chief means of long-distance overland coal transportation -- has become critical to mining companies and to China's energy security.


Coal in China

The MasterMetals Blog