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(Updates with additional comments on diamond industry)
CARACAS -(Dow Jones)- Venezuela and Russia have created a joint company to operate the Las Cristinas gold mine, which is thought to possess one of the largest gold reserves in South America, President Hugo Chavez said Tuesday.
The president also reiterated that Venezuela would start operations in Las Cristinas in 2009.
The Venezuelan state "will take control of production of Las Cristinas in 2009," Chavez told the National Assembly during his yearly address, confirming previous announcements made months earlier by Mining Minister Rodolfo Sanz.
Chavez said that Venezuela had created a joint company in 2008 with Russia to exploit Las Cristinas.
There's been widespread speculation that Venezuela would tap Russian mining company Rusoro Ltd. (RML.V) to help it run Las Cristinas. Chavez did not clarify if Rusoro was part of the joint company created with Russia.
The president said Venezuela has as its goal almost doubling its gold production in 2009 to 8.2 tons.
Chavez made no reference to Crystallex International Corp. (KRY), which had a deal with the Venezuelan government to operate the mine and which had been waiting for years for the necessary permit.
Chavez also said that the government plans to take a greater role in the production of other natural resources next year, most prominently in the diamond industry.
-By Darcy Crowe, Dow Jones Newswires; (58) 212 905 6304; darcy.crowe@ dowjones.com
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