Heeney Capital Secures 30-Year Operating Rights for Venezuela's Chocó Gold Mine, with Up to US$1 Billion Investment

en.Wedoany.com Reported - On September 16, the U.S. investment firm Heeney Capital signed a mining concession agreement with the Venezuelan government and the Venezuelan Mining Corporation (CVM) to develop and operate the Chocó gold mine project in the El Callao mining district of Bolívar State. The agreement has a term of 30 years and grants the project the right to export gold. Heeney Capital plans to invest up to US$1 billion in initial investment in the project, while collaborating with commodity trader Mercuria Energy to advance gold sales and offtake arrangements.

The agreement was jointly signed by Heeney Capital, the Venezuelan government, and CVM, with Heeney Capital responsible for project development and operation. The project agreement includes provisions for subsequent extensions of the term. The currently public documents have not yet disclosed the specific revenue-sharing ratio between the government and the company, nor the specific equity structure of CVM in the project company.

In May of this year, Mercuria Energy and Heeney Capital had already signed multiple offtake arrangements for Venezuelan gold and other bulk mineral products, along with supporting related investments. The related project portfolio is expected to correspond to approximately US$2.2 billion per year in mineral product export value. This amount is on an aggregate basis across multiple gold and bulk commodity projects, and is not the output value of the Chocó gold mine project alone.

The Heeney Capital project party had previously obtained the necessary authorization from the U.S. Department of the Treasury's Office of Foreign Assets Control for related Venezuelan gold and bulk commodity investment, trade, and offtake arrangements. The relevant authorization covers certain mineral product transactions and investment activities conducted by the project party under the U.S. sanctions framework.

The Chocó project is located in the El Callao gold mining district in Bolívar State in southern Venezuela. According to U.S. Geological Survey data, industrial-scale gold mining and processing activities have long existed in the El Callao area, and historical mining assets include the El Chocó mine and related processing facilities. The area is located in the greenstone belt of the Guiana Shield, and historically has formed multiple gold mining concessions and production blocks, including Chocó 4 and Chocó 10.

Historical records show that Chocó 10 once used open-pit mining methods, supported by crushing, grinding, and carbon-in-pulp gold processing facilities. Heeney Capital and CVM have not yet announced the precise mining concession boundaries corresponding to this 30-year concession agreement, nor have they disclosed the current mineable reserves, resources, or technical parameters of existing processing facilities for the Chocó project.

Heeney Capital plans to use up to US$1 billion to fund the restoration and development of the El Callao project. The company expects that after the project becomes operational, it will pay taxes and mining royalties to the Venezuelan government. At present, the phasing of capital expenditure, designed ore processing capacity, annual gold output, the scale of construction or renovation of the processing plant, and the timing of first gold production have not yet been announced.

The project will subsequently advance mine development plans, capital expenditure arrangements, construction or restoration of mining and processing facilities, and gold production and export work.