Vancouver — Facing a deadline imposed by its partner, Placer Dome (PDG-T) has sold its 70% interest in the Las Cristinas gold project in Bolivar state, Venezuela, to Vancouver-based Vannessa Ventures (VVV-V).
Corporacion Venezolana de Guayana (CVG), which is owned by the Venezuelan government, ended an agreement that gave Placer a one-year extension on the development of Las Cristinas, which had been shelved for two years.
Francisco Rangel Gomez, CVG’s president, said the agreement, which would have run out on July 15, would be terminated and CVG would immediately move forward with other partners.
The terms of Placer’s deal with Vannessa were not disclosed, but Placer will retain a carried interest and a right to back into the project. Should Placer ever exercise that right, Vannessa would retain a carried interest or royalty.
Placer suspended construction at Las Cristinas two years ago because of low gold prices. Last year, the major took a US$116-million writedown on its 70% stake in the property after the company announced that it would be uneconomic to resume construction on the US$575-million project.
CVG subsequently agreed to two 12-month suspensions, with Placer maintaining its share in the venture.
“We believe the prudent course for us and our partner is to maintain the property until technology or market conditions improve,” Jay Taylor, Placer’s president, said at the time of the writedown.
Las Cristinas holds proven and probable reserves of 323 million tonnes grading 1.1 grams gold per tonne. Production was expected to average 530,000 oz. gold per year over the first 10 years of a planned 20-year mine life, with total costs coming in at US$240 per oz.
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