Rusoro Mining Ltd will be transferring its assets to a joint venture with a state owned company as a partner as Venezuela nationalizes gold mining. The company is the only publicly traded gold miner in the country. The nationalization of gold was announced by President Hugo Chavez this month.
Rusoro Mining will transfer its gold assets to Petroleos de Venezuela SA said that Chief Executive Officer Andre Agapov. It will have a 45% stake in the newly formed joint venture company. The company is based in Vancouver.
Mr Agapov said that now there was policy clarity. The company would be compensated and the formula for compensation will be identical to the way they compensated the petroleum companies in 2006 and 2007. It was basically book value with some premium he added.
The details of the joint venture were clarified to Rosoro Mining officials when they met with Oil Minister Rafael Ramirez in Caracas last week. Mr Agapov said Minister Ramirez thought that there would be possibilities of going jointly into new areas in Venezuela. They would like to develop some other properties together with the company. Once the joint venture was formed, they would have to develop their strategy.