Financial Post | 14 August 2018
Gold Reserve provides Venezuela update
SPOKANE, Wash. — Gold Reserve Inc. (TSX.V: GRZ) (OTCQX: GDRZF) (“Gold Reserve” or the “Company”) is pleased to provide an update on the payments related to the previously announced Settlement Agreement with Venezuela (“Settlement Agreement”).
Under the terms of the Settlement Agreement Venezuela agreed to pay Gold Reserve a total of approximately US $1.032 billion, comprised of approximately US $792 million in satisfaction of the arbitral ICSID Award granted in favor of the Company and US $240 million for the sale of the Company’s technical mining data related to the Siembra Minera Project. The Company received today Venezuelan government bonds with an estimated current market value of approximately US$88.5 million as payment towards the December 2017 and January and February 2018 monthly installments due under the Settlement Agreement. As a result of this payment the Company has received an aggregate of US $276 million (including payments made to the Company’s trust account with Bandes Bank in Venezuela). Venezuela remains 5 months in arrears (at US $29.5 million per month) on its obligations under the Settlement Agreement. The Company and Venezuela are continuing discussions to facilitate the payment of the arrears and future payments.
In addition, approximately US $8 million previously tendered by the Venezuelan government was transferred recently from the Company’s trust account in Venezuela to its bank account in North America, leaving approximately US$37 million remaining in the trust account.
Senior Management of Gold Reserve has been in Caracas working with Venezuelan officials on matters related to the development of the large scale Siembra Minera Project. In addition, the Company is also advancing various social works programs in the project area relating to the rehabilitation of medical, educational, and recreational facilities along with engineering work related to landfills, sewage collection, water distribution systems and related treatment plants to facilitate the transition of the area to accommodate a nearby major mining operation. The Company is currently transporting a large sample of the surface saprolite material to the United States for metallurgical testing which will aid in the final engineering design of the Early Works Project.
Doug Belanger, President, stated, “We are very pleased with the receipt of bonds which confirms our partner’s commitment to meet its obligations and advance one of the largest undeveloped gold-copper projects in the world, despite their economic challenges. We look forward to continue working with Venezuela towards that goal.”
Canaccord Genuity Corp. has been retained by the Company to provide financial advisory and other services with respect to the bonds.