Gold Reserve announced it has executed a settlement agreement with the Bolivarian Republic of Venezuela, which includes payment of the arbitral award of $770 million granted in favor of the company by the International Centre for Settlement of Investment Disputes in respect of the Brisas project. In addition, Venezuela has agreed to acquire the company’s mining data for $240 million and both parties have entered into an agreement to form a jointly owned company, which will have the gold, copper, and silver rights to 18,000 hectares, including the Brisas Cristinas deposit.

Venezuela will pay the company the award in two installments: $600,000,000, which is expected on or before October 31, and the remaining $169,681,823 on or before December 31. The fee for the technical mining data will be paid in four quarterly installments of $50 million beginning October 31, with a fifth and final installment of $40 million due on or before October 31, 2017. After the final payment, the company’s technical mining data will be transferred to the Venezuelan National Mining Database. The joint venture (55% Venezuela, 45% Gold Reserve) will develop the $2.1 billion Brisas Cristinas project. The term of the agreement is 40 years (20 years with two 10-year extensions).

Gold Reserve, under a technical services agreement, will provide engineering, procurement and construction services to the joint venture. It will receive a fee of 5% of all costs of construction and development of the project. After commencement of commercial production, the company will be paid a fee of 5% for its technical assistance during operations.

Presidential Decrees have been or will be issued within the legal framework of the Orinoco Mining Arc, with tax and fiscal incentives for jointly -owned operating in that area.

Venezuela and Gold Reserve will share the net profits. For sales up to $1,600/oz, net profits will be allocated 55% to Venezuela and 45% to Gold Reserve. For sales greater than $1,600 oz, the incremental amount will be allocated 70% to Venezuela and 30% to Gold Reserve.

“On behalf of the shareholders and stakeholders, we are very pleased to settle our dispute with Venezuela,” said Doug Belanger, president of Gold Reserve. “This settlement allows us to proceed with the tremendous opportunity for the company and Venezuela to jointly develop the Brisas Cristinas gold, copper deposit while providing Venezuela a great opportunity to attract new foreign direct investments due to the set of policies and regulations approved by the administration for the mining industry.”

When constructed, the combined Brisas Cristinas project, a gold-copper deposit located in the Kilometer 88 Mining District of Bolivar State in southeast Venezuela, is anticipated to be the largest gold mine in South America and one of the largest in the world.