American Think Tank: The Gap Between Geological Potential and Actual Production of Critical Minerals in Venezuela Is Enormous

Former President Nicolás Maduro designated approximately 12% of Venezuela’s territory as the "Orinoco Mining Arc" (Arco Minero del Orinoco). This region spans parts of Bolívar, Amazonas, and Delta Amacuro states and is rich in gold, bauxite, tantalum-niobium ores, and industrial diamonds—including areas adjacent to protected zones such as Canaima National Park.

However, in practice, the "Orinoco Mining Arc" has become a hub for informal and illegal mining activities. Armed non-state actors and criminal networks control most mining operations, while the state uses security forces and nominally state-owned enterprises to legitimize otherwise illicit activities. Mining has extended far beyond the boundaries of the Orinoco Mining Arc, spreading into national parks and protected areas—highlighting that Venezuela’s mineral production is driven more by informal, militarized, and criminal actors than by formal investment.

Venezuela possesses significant deposits of tantalum-niobium and bauxite, but no industrial-scale mining is currently underway. The Los Pijiguaos mine is Venezuela’s only operating bauxite mine, located within one of the country’s most important industrial mineral resource zones. Surrounding areas are estimated to hold up to 6 billion tons of bauxite resources. The ore itself is of high quality—nearly 100% gibbsite with extremely low organic content—making it ideal for alumina refining. The Los Pijiguaos mine is operated by CVG Bauxilum, a subsidiary of the Venezuelan state-owned enterprise CVG.

At full capacity, the Los Pijiguaos mine can produce over 5 million tons of bauxite annually. However, this potential has not been realized in practice. In 2019, CVG Bauxilum suspended bauxite mining and alumina production due to prolonged power shortages, poor management, and shortages of imported raw materials.

Although President Maduro announced plans in April 2019 to resume production—targeting 18,000 tons of alumina per month and full mine restart by the end of 2020—these efforts were ultimately abandoned. Today, the Los Pijiguaos mine stands as a vivid example of Venezuela’s broader mining paradox: abundant geological resources constrained by state-led governance failures, collapsed infrastructure, and persistent operational breakdowns.

The gap between geological potential and actual output is enormous. By 2024, Venezuela’s gold production accounted for only 0.84% of global output, and its iron ore production represented just 0.10%. Despite repeated claims of abundant mineral wealth, Venezuela has never established the institutional capacity or industrial foundation necessary to harness these resources.

Creating the foundational or investment environment required to transform subterranean resources into sustainable, large-scale production is crucial. This serves as a warning: mineral resources alone do not guarantee a reliable supply. Early promise, without effective governance and investment, may ultimately remain nothing more than a long-term illusion.

Source: Center for Strategic and International Studies (CSIS)

Original article: toutiao.com/article/1861258853834052/

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