UNCLASSIFIED
UNCLASSIFIED
Report to Congress on
The State-Sponsored Extraction and Sale of Gold
from Venezuela’s Orinoco Mining Arc, and from
National Reserves in Venezuela such as Canaima
National Park
Section 7019(e) of the Department of State, Foreign
Operations, and Related Programs Appropriations Act, 2024
(Div. F, P.L. 118-47) and the Joint Explanatory Statement
In 2011, former president Hugo Chavez nationalized the gold industry,
seizing mines from Crystallex International, Gold Reserve, and Rusoro
Mining. Faced with declining oil revenues, Nicolas Maduro turned to gold
mining to generate revenue with the creation in 2016 of the Orinoco Mining
Arc (Arc), encompassing around 12 percent of Venezuela’s territory. The Arc
was established via executive decree, rather than by legislative action, with
broad authorities to oversee its development. However, the Arc failed to
attract investment from outside investors or result in any large-scale
operations. Instead, the Arc, where many Indigenous peoples live, has
become a center of illicit gold mining and smuggling. The mining and
subsequent sale of gold has proven to be a lucrative financial scheme in
recent years for some well-connected Venezuelans and individuals within
the National Bolivarian Armed Forces, which profit from charging criminal
Page 2 of 6
UNCLASSIFIED
organizations for access. The estimated market value of gold mined in
Venezuela is difficult to confirm, but a September 2021 OECD report
examining the risks of corruption, conflict financing and money laundering
linked to gold flows from Venezuela estimated that it averaged up to $2.2
billion annually over the past five years.
Gold Mining’s Link to Human Rights Abuses in Venezuela:
The illegal mining, smuggling, and selling of Venezuelan gold, enabled and
facilitated by Maduro representatives, poses a threat to the Indigenous
peoples in the Arc and Venezuelan national reserves. Civil society and
environmental groups have criticized Venezuela for bypassing cultural
impact studies in the development of the Arc. The living conditions of
miners are dire–many lack basic services such as sanitation, water, or
electricity and sleep under plastic and wooden boards as makeshift shelters.
Violent crimes, including homicides, have become increasingly prevalent in
these mining communities. Illegal mining has bred illicit economies, fuel and
food smuggling, commercialization of harmful substances such as mercury
and cyanide, child labor, forced labor, and human trafficking.
NGOs that monitor human trafficking in border regions affirm the existence
of a permissive environment in which non-state armed groups like the
Revolutionary Armed Forces of Colombia (FARC) and the National Liberation
Army (Colombia) (ELN), and gangs such as El Tren de Aragua, manage illegal
border crossings with Colombia and allow or participate directly in human
trafficking. They also report that in mining states like Bolivar, criminal
groups called grupos de control sexually exploit women and girls and recruit
Page 3 of 6
UNCLASSIFIED
and exploit people, including younger children and adolescents, in forced
labor in mines. Many of the victims enter the area looking for opportunities
to work in the mines to escape poverty but are only offered employment in
commercial sex, to which children cannot legally consent. Women and
young girls are also often sold for small amounts of gold (between five and
10 grams). In addition, the military, non-state armed groups, and illegal
miners force women, girls, adolescents, and younger children to engage in
criminal activities. The UN Committee on the Elimination of Discrimination
Against Women acknowledges the common occurrence of sex trafficking
and sexual slavery. High numbers of femicides and gender violence apart
from human trafficking have also been recorded in these areas.
Health problems such as HIV/AIDS and other sexually transmitted diseases,
malaria, yellow fever, and mercury poisoning are also common. The large
amounts of standing water at illicit mining sites have led to increased cases
of malaria, diphtheria, chikungunya, yellow fever, and dengue. The
widespread and uncontrolled use of harmful substances to extract and
process gold has created significant health and environmental risks for
workers and local communities. Over 90 percent of people working in the
mines show unsafe concentrations of mercury in their urine. In one Arc
town, an estimated 38 percent of the school-aged population has recorded
mercury contamination, according to one Venezuelan official familiar with
the illicit mining industry. In a river basin near one mining region in the Arc,
reports found elevated levels of mercury in 92 percent of Indigenous
women. In El Callao, Bolivar state’s gold processing hub, more than 800
mills use mercury and cyanide.
Page 4 of 6
UNCLASSIFIED
The loose rules surrounding gold extraction facilitate access to mining
proceeds for criminal gangs, the police, the military, and lower-level
government officials at multiple stages in the gold supply chain. As
sanctions have reduced revenue streams from the country’s all-important
energy sector, gold has increased in relative importance to financial flows.
The overall effect has been to create a patronage network of actors
motivated to weaken the rule of law and oppose a return to democracy in
Venezuela. Venezuela’s sales of gold held by the Central Bank also relieve
some economic pressure using gold as a currency substitute for trade.
According to the 2021 OECD report cited above, non-state armed groups,
U.S.-designated terrorist groups such as the FARC-EP and ELN, and regional
criminal organizations coordinate with the police, the Venezuelan military,
and senior Maduro representatives to maintain power over the mines,
transit routes, and resources required to extract and transport the gold. The
criminal gangs that control the mines subject those physically mining gold to
horrific human rights abuses and dangerous working conditions, according
to NGO watchdogs. Torture and corporal punishment, ranging from
beatings to killings, disappearances, child labor, and massacres are common
in the mining areas, where criminal gangs act as the sole authority. This vast
criminal network operates across borders into Brazil, Colombia, and Guyana,
threatening the security and stability of Venezuela’s neighbors and
perpetuating corruption and human rights abuses across the region.
These operations show no signs of slowing, as gold mining is the primary
industry in some economically depressed and undeveloped areas. As a
Page 5 of 6
UNCLASSIFIED
result of Venezuela’s political, social, and economic crises, Indigenous
peoples practice illegal mining to survive, often using gold as currency to
purchase food and other basic items. Armed groups and corrupt security
forces take advantage of these conditions and reportedly threaten and
attack Indigenous leaders who refuse to allow smuggling or mining in their
territories. Horrific conditions are especially evident in Zulia, Bolivar, and
Amazonas, three states that have the largest reserves of minerals and the
highest populations of Indigenous communities.
Harmful Environmental Effects of Gold Mining in Venezuela:
Civil society and environmental groups have also criticized Venezuela for
bypassing environmental impact assessments of gold mining in Venezuela
(U.S. Treasury March 19, 2019 Press Release: Treasury Sanctions
Venezuela’s State Gold Mining Company and its President for Propping Up
Illegitimate Maduro Regime). With the most accessible gold deposits
already having been mined, operations have expanded into protected areas,
causing massive deforestation–over 1,000 square miles–and significant
other environmental damage and habitat loss to national parks in Venezuela
and the wider Amazonian ecosystem. In addition, the physical processes
used in illicit mining are causing environmental and ecological devastation in
Venezuela and throughout the Amazon region and disproportionately
affecting Indigenous peoples who do not participate in mining. Mercury and
other chemicals used in mining contaminate rivers, poison fish, and damage
technology used to provide fresh drinking water to the Venezuelan people.
In April 2020, Venezuela lifted a prohibition on river mining in the region,
Page 6 of 6
UNCLASSIFIED
allowing mining near Bolivar state’s rivers that supply 90 percent of
Venezuela’s fresh water.
Minerven Sanctions Relief:
As the sole state gold processor in Venezuela, CVG Compania General de
Mineria de Venezuela CA (Minerven) purchases gold from miners for further
processing. Relief of sanctions on Minerven, which lasted from October
2023 to February 2024, was too brief to assess the impact on human rights
abuses or transparency in the mining sector.
