Takeaways

• Venezuela has passed a new mining law allowing 30-year concessions across vast areas of the Amazon rainforest.
• Environmental groups warn the law could accelerate deforestation and weaken transparency.
• The move aims to attract foreign investment and strengthen Venezuela’s role in global oil and critical minerals supply chains.

Venezuela has introduced a sweeping new mining law that could reshape its natural resource sector while raising serious concerns about environmental damage in the Amazon.

The legislation, approved by the country’s National Assembly, opens up 11.2 million hectares of mineral-rich rainforest to domestic and international investors. It replaces earlier regulations from 1999 and 2015, marking a major shift in how Venezuela manages its natural resources.

At the centre of the law is a provision allowing companies to operate under concessions lasting up to 30 years. Firms will be required to pay royalties of up to 13% of gross production value, along with a 6% tax on revenue. The government hopes these terms will attract investment into untapped reserves of gold, coltan, and bauxite, minerals essential for electronics, manufacturing, and energy systems.

Read More: Brazil Receives €1B from Germany to Protect Rainforests

The move comes amid broader efforts to liberalize Venezuela’s economy. Earlier this year, the country also passed a hydrocarbons law to reduce state control over oil and gas exploration. Officials believe these reforms could unlock new revenue streams and strengthen Venezuela’s position in global supply chains for critical minerals.

International interest is already growing. US officials have signalled optimism about increased cooperation, particularly in securing supplies of minerals used in modern technologies. These include coltan, found in smartphones and electric vehicles, and bauxite, a key material for aluminium production.

However, environmental groups are raising alarms. The Amazon region affected by the law is one of the most biodiverse ecosystems on Earth. Data from monitoring programmes shows that mining activity alone led to over 9,500 hectares of deforestation in 2024. Critics fear that expanding industrial-scale operations could worsen forest loss and disrupt fragile ecosystems.

The law includes provisions for environmental impact assessments and consultations with Indigenous communities. But these safeguards are not required before contracts are signed or operations begin. Experts warn that this timing could limit the ability to prevent damage, as extraction activities may already be underway before reviews are completed.

Concerns have also been raised about transparency. Opponents argue that the revised framework may restrict public access to information about mining operations, making it harder for local communities to understand how projects could affect their land and livelihoods.

The mineral reserves targeted under the law are located mainly in Bolívar and Amazonas states, within the Orinoco Mining Arc. These areas are home to both rich biodiversity and Indigenous populations, adding complexity to any large-scale development.

For investors, the opportunity is significant, but so are the risks. Long-term concessions in environmentally sensitive regions mean companies must carefully balance profitability with sustainability. The absence of strict pre-operational checks may also increase reputational and regulatory challenges.

Also Read: Chinese Miners Face Scrutiny Over Environmental Destruction in DRC

As Venezuela pushes to expand its oil, gas, and mining sectors, the long-term environmental cost remains uncertain. The new law could boost economic growth and global trade in critical minerals, but it may also place one of the world’s most important ecosystems under increasing pressure.

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Source: SUSTAINABILITY Magazine