Gold Reserve's Venezuelan Permit Approved: Is Crystallex Next?

Gold Reserve Inc. (GRZ) announced that the Venezuelan Ministry of Environment has approved the Brisas Environmental and Social Impact Assessment [ESIA] for the exploitation and processing of gold and copper mineralization. As a result, the Ministry has issued the permit or authorization for affecting natural resources for the commencement of the construction phase of the Brisas Project. Gold Reserve Inc. is a Canadian company developing the Brisas gold copper project is Southeastern Venezuela. The stock is higher by $2.03, or 46.14%, to $6.43 on the news.

Naturally, this is sparking rumors that Crystallex Corp. (KRY) could also be issued its long awaited environmental permit that would allow it to commence operations at its Venezuelan gold mine. Crystallex has repeatedly assured investors that the issuance of such a permit was in its last stages, but doubts continued to resurface because of the unstable geopolitical situation in Venezuela resulting from and Hugo Chavez's threats to nationalize the mining industry. However, today's news appears to be the most credible in terms of signaling that Crystallex could the next company in line to be issued a permit. The stock is reflecting that sentiment and in just the last few minutes, shares have spiked higher by 0.85, or 27.87%, to $3.90 on heavy volume of 16 million shares.

Crystallex has been no stranger to this type of volatile trading activity. On March 13, speculation swirled that Crystallex was the target of an unsolicited takeover bid. The market acted swiftly and took up shares of Crystallex, but the company quickly came out and denied the rumors. Crystallex has made no comment at this time on today's trading action.

KRY 1-yr chart: