Venezuela to ensure security of mining companies, exceed oil production goals-Burgum

CARACAS, March 5 (Reuters) – United States Interior Secretary Doug Burgum sounded an optimistic note as he prepared to leave Venezuela on Thursday after a two-day visit, telling journalists a new mining law will create opportunities for companies, licenses allowing them to operate are on the horizon and the interim government of Delcy Rodriguez has promised to ensure their security.

Burgum, who also heads the U.S. National Energy Dominance Council, has hailed efforts by interim President Delcy Rodriguez to open the South American country to foreign investment in oil and minerals, echoing praise by U.S. President Donald Trump.

Burgum is the second cabinet secretary to visit Venezuela since a January U.S. raid that captured President Nicolas Maduro. U.S. Energy Secretary Chris Wright visited in February.

Despite having massive reserves of minerals from gold to iron ore, bauxite and coltan, Venezuela’s output is at a fraction of capacity as plants urgently need major repairs and investment for expansions and upgrades. The country’s main conglomerate, CVG, remains cash-strapped and under U.S. sanctions, as does state mining company Minerven.

Following nationalizations under late President Hugo Chavez, foreign investment has been minimal in the last decade. Some experts now see room for an immediate export recovery, particularly for gold, but have warned that massive investment – even higher than for the oil industry- is needed, along with renovated efforts for exploration.

Burgum brought more than two dozen mining and minerals companies with him on the visit, he said, and met on Thursday morning in Caracas with major foreign oil and gas companies as well as the heads of large Venezuelan companies and banks.

Asked about corruption and security issues – including armed groups which participate in illegal mining in some regions – Burgum said the companies interested in coming into or returning to Venezuela have proven track records of integrity and that the new law will be an opportunity for them to create jobs.

“I think you’re going to see this government very concerned about providing the right kind of security. We heard assurances in the meeting today and yesterday that if companies wanted to get to these areas, do due diligence, think about reopening mines, maybe even getting back to mines that they themselves were running 15 or 20 years ago, that this government would ensure their security,” Burgum said.

“I’m feeling very optimistic about an environment where investment is going to flow, not just to offshore oil and gas, not just to Caracas but actually to the interior where these enormous resources exist,” he added.

There will soon be a set of general licenses for the mining industry, similar to some already issued for oil producers, Burgum added.  

(Reporting by Reuters)