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As the helicopter skims low over one of the largest undeveloped gold deposits in the world, just south of the ragtag mining town of El Dorado, the pilot shrugs bleakly.“It’s a great shame,” he says, gesturing at the scar blighting the pristine forest in south-eastern Venezuela, cleared by thousands of small-scale, illegal miners in their hunt for gold.But after a decades-long free-for-all in which prospectors have wreaked environmental havoc while private companies have failed to extract an ounce of gold from Las Cristinas, Hugo Chávez, the president, has said it may be exploited in a joint venture between the state and Rusoro Mining, a Russian miner.Since oil provides more than 90 per cent of export revenues and more than half of government spending, collapsing energy prices have ignited the government’s interest in the sizeable gold reserves in order to bolster its earnings, as well as in commodities such as coffee and cacao-once Venezuela’s biggest export.The partnership between the socialist president and the Russian company is one of the fruits of a budding friendship between Caracas and Moscow-part of the strategy of Venezuela’s anti-imperialist president to challenge US influence in the region.“The spirit of goodwill between the two governments has certainly helped us a lot,” says George Salamis, president of Rusoro, which has already acquired and turned round two struggling mining operations here in the past year.Some foreign companies have had a rough ride in Venezuela in recent years as Mr Chávez sought to make an example of capitalist companies while deepening his socialist revolution.As well as companies affected by the state’s drive to take over “strategic” industries during the past two years, one of the companies with the most disappointing performance has been Canada’s Crystallex, which has been waiting for a permit to develop Las Cristinas since it was granted the concession in 2002.“My main concern is removing the perception that Venezuela is a risky place to do business, which has been exacerbated by what has happened at Las Cristinas over the last 15 years,” says Mr Salamis.By Benedict Mander in Caracas
As in the days of Noah...
