Gold Reserve Provides November Venezuela Update (11/22/17)
SPOKANE, Wash.--(BUSINESS WIRE)--Gold Reserve Inc. (TSX.V: GRZ) (OTCQX: GDRZF) (“Gold Reserve” or the “Company”) reported on activities in Venezuela with respect to the Siembra Minera S.A. gold/copper/silver project (owned 45% by the Company and 55% by the Bolivarian Republic of Venezuela).
Gold Reserve, Siembra Minera S.A. and their technical consultants are working to complete the Preliminary Economic Assessment (“PEA”) in accordance with National Instrument 43-101. This study will include an up to date resource estimate, a mine plan including gold, copper and silver production, estimated capital and operating costs, and overall project schedule for both the planned early production 15,000 tonnes per day saprolite mill and the longer term 140,000 tonnes per day hard rock mill.
The Company is also pleased to report net income of US$34.3 million (US$0.36 per share) for the third quarter ended September 30, 2017, versus a US$5.6 million net loss (US$0.06 per share) for the same period in 2016. Revenues for the third quarter 2017 were US$88.5 million versus no revenues in the same period of 2016. For the nine months ended September 30, 2017 net income was US$81.8 million versus a net loss of US$15.1 million for the same period of 2016. Revenues for the nine months were US$187.5 million versus no revenues in the same period of 2016. The Company’s unaudited interim consolidated financial statements and related management’s discussion and analysis for the three and nine months ended September 30, 2017 have been filed and are available for review under the Company’s profiles at www.sedar.com and www.sec.gov.
The Company also announces that it has received the November installment payment of US$29.5 million pursuant to its Settlement Agreement with Venezuela. These funds were deposited into a trust account for the benefit of the Company at Banco de Desarrollo Económico y Social de Venezuela (“Bandes”), a Venezuelan state-owned economic and social development bank. As a result of the sanctions issued in August 2017, the U.S. government restricted the Venezuelan government’s access to the U.S. financial markets by filing executive orders barring, among other things, dealings in new bonds and stocks issued by the Venezuelan government and the state oil company and prohibiting Americans from doing business with them. Subsequent to the U.S. actions, Canada imposed its own sanctions. The sanctions imposed by the U.S. and Canada subsequently led international intermediary banks, which previously facilitated the transfer of funds from Bandes to the Company’s United States bank accounts, to decline to facilitate such transfers or put significant limitations on their participation. The Company and Venezuela have been working with various international banks to accomplish these transfers. Including the November 2017 payment, Gold Reserve has received an aggregate of US $187.5 million pursuant to the Settlement Agreement, of which US$99 million has been transferred to its U.S. bank account and US$88.5 million remains in the Bandes trust account.
Also as a result of the U.S. sanctions, the US$350 million in face value of debt securities that were intended to be pledged as collateral for a portion of the Settlement Agreement payments were not on the exempt list, and are therefore no longer marketable. The Venezuelan government is working to replace this collateral with something that is both acceptable to Gold Reserve and permitted under the sanctions.
Doug Belanger stated, “The government of Venezuela has assured the Company that it remains committed to the Siembra Minera Project and the terms of the Settlement Agreement with Gold Reserve and we are hopeful that the Company can work within the restrictions of the U.S. and Canadian sanctions to resolve the current situation.”
Further information regarding the Company can be located at www.goldreserveinc.com, www.sec.gov and www.sedar.com. http://www.businesswire.com/news/home/20171122005639/en/Gold-Reserve-November-Venezuela-Update