Venoro crews at work in Venezuela

A crew of more than 25 is busy exploring two concessions — El Placer and San Raphael — in the Venezuelan gold district of El Dorado.

The effort is being managed by Venoro Gold (VSE), which earlier this year entered an option agreement with Randstrom Manufacturing (VSE), allowing it to acquire a 65% interest in the concessions.

Venoro must pay $600,000 (cash and shares) and assume the balance of payments to the vendors, which total US$5.6 million over four years. The company must also complete a bankable feasibility study by June, 1997.

The junior can increase its interest to 75% by arranging production financing, and to 100% if a lender requires this level of interest as a condition for placing the concessions into production.

Venoro, formerly known as Senn D’Or, shares several directors with another junior active in Venezuela, Crystallex International (VSE). A recent addition to Venoro’s board is Pierce Parker, a former president of Amax Explorations. The two concessions, within Bolivar state, are west and along strike of La Comorra, a mine being prepared for production by British-based Monarch Resources. Reserves for this advanced project are 890,000 tonnes grading 19.5 grams gold per tonne.

Randstrom President Randy Reifel said the acquisition of El Placer and San Raphael resulted from an effort to examine Venezuela’s historic mining districts during the late 1980s and early 1990s.

“Our interest was piqued by the Kilometre 88 district, but at that time it was crawling with illegal miners, so we headed farther south and became interested in these two concessions which we felt to be in the heart of El Dorado,” Reifel said.

Carson Gold, another junior managed by Reifel, went on to acquire a substantial land package in the Kilometre 88 district after the government announced it would take steps to remove the illegal miners.

“In the summer of 1992, we got two-thirds of the ground we applied for, in the Kilometre 88 district, and soon had a lot of parties interested in making deals on those concessions,” Reifel recalled. “We ended up deciding to enter joint ventures with Venezuelan Goldfields, which tied up our holdings in that district.”

Reifel then turned his attention to Randstrom (a name change to Francisco Gold is in the works), which began acquiring prospective ground previously identified in other districts. A field program was carried out in May and June of this year on El Placer and San Raphael. It was supervised by geologist Luca Riccio who concentrated on previous mining sites. El Placer received considerable attention because a previous owner had realized small-scale production from a vein system. Production in recent years totaled 10,000 tons, with 19-20 grams gold per ton having been produced from primary and secondary processing.

This “main vein” trend is being further explored. The program, to be completed by December, will include core drilling and trenching of this and other targets.

Before this work began, in October, the San Raphael concession was the site of a “boil,” a local term used to describe an illegal gold mining rush. Tons of surface material were removed before the company called in the National Guard to remove the illegal miners.

“The only positive result from the illegal miners’ activities was the locating and uncovering of several areas of high-grade, visible gold showings,” said Venoro President Steven Kerr.

Venoro points out that its concessions are easily accessible and free of legal or ownership disputes. They also include both surface and lode mining rights.