So why is Gold Fields (GFI) in JV with Vena Resources (VEM.to), Otto?

Good question. Hmmmm...let's see now.

First, let's take this morning's news release about the major new gold discovery made by Gold Fields (GFI) and Buenaventura. Here's how the NR kicks off:

JOHANNESBURG, May 11, 2010 /PRNewswire-FirstCall/ -- Chucapaca's joint venture partners, Gold Fields Limited (51%) (Gold Fields) (JSE, NYSE, NASDAQ Dubai: GFI) and Compania de Minas Buenaventura S.A.A. (49%) (Buenaventura, BVN), are pleased to announce the discovery of a major gold-copper-silver deposit in their Chucapaca project area (CPA) in southern Peru.

Called the Canahuire deposit, it has a Mineral Resource estimate of 5.6 million gold equivalent ounces[1] (Table 1), with mineralisation potential beyond the extent of current drilling. The Inferred Mineral Resource for Canahuire is approximately 83.7 Mt at 1.9 g/t gold, 0.09% copper and 8.2 g/t silver for a total of 5.6 million gold equivalent (AuEq1) ounces. CONTINUES HERE

And if you do the math, 5.1m oz of that total is pure gold.

Second, let's remember what the GFI Head of Exploration said about the area in and around Chucapaca. In his opinion, what we have here is a "new district".

Third, let's check a map:

click to enlarge (gets big)

And here's a nice close-up.

Oh look! Esquilache is just 25km away from a major new gold discovery made by GFI....hoodathunkit, eh?

Fourth, let's remind ourselves of the VEM.to NR dated May 4th 2010.

TORONTO, ONTARIO--(Marketwire - May 4, 2010) - Vena Resources Inc. (TSX:VEM - News;VEM - News; FRANKFURT:V1R - News; OTCBB:VNARF - News), a Company with strong partnerships with four of the world's largest mining companies, is pleased to announce that after field reviews conducted by its partner Gold Fields Limited ("Gold Fields") (NYSE:GFINews; JSE:GFI)(NASDAQ Dubai:GFI) in the Amantina region (18,900 hectares) in southern Peru, a technical committee comprised of geologists from both Vena and Gold Fields has agreed to advance the exploration to focus on a significant diatreme breccia target that had been previously identified by Vena in 2007. LIMA: -

The explosive breccia target known as the Amantina prospect is located approximately nine kilometres east of the historic Esquilache silver mine where Vena is actively exploring and approximately 27 kilometres east of the Gold Fields / Buenaventura Chucapaca JV project. The Amantina prospect consists of a polymictic breccia with a strongly silicified chalcedonic matrix surrounded by a zone of hydrothermal heterolithic breccias developed in Tertiary aged andesitic volcanics. The core breccia measures approximately 400 x 200 metres and trends N 20 degrees E. Additional lenticular outcrops of breccia poke through the extensive soil cover approximately 250 metres to the southeast and indicate that the overall size of the diatreme pipe may be much larger than the observed outcrop. The breccia body responded as a chargeability / resistivity high (disseminated pyrite in the siliceous matrix) during the 2007 induced polarization survey conducted by Vena and two other similar targets were identified to the southwest and northeast.

Strongly anomalous mercury, arsenic, lead and antimony geochemistry combined with the chalcedonic content of the breccia matrix suggest that CONTINUES HERE

Hey, there are never any guarantees when you're out exploring for gold, but GFI didn't just pick the VEM Esquilache/Amantina concession to JV because it had some leftover geologists that wanted a new spot in the mountains to go hiking. DYODD, dude.

Vena Resources news (VEM.to)

Thought for the day: When a small junior mining company specializing in Peru attracts a decent, world class joint venture partner, then you can virtually guarantee that the bigboy miner in question can spot a bargain or a good, solid team with which it can work.

So what can you deduce from a small mining company like Vena Resources (VEM.to) that has attracted not one but three world class companies to JV with it?

• In Base Metals, Vena Resources JVs with Glencore, as big as it gets in the sector.

• In Uranium, Vena Resources JVs with Cameco, world leader in the metal.

• And now in Precious Metals, Vena Resources has attracted Gold Fields (GFI) as a JV partner to explore its highly prospective Esquilache project in southern Peru.

So ask yourself this: What do serious, world leading mining companies see in VEM.to that the retail market has up to now ignored? Your humble correspondent owns, so DYODD. Now check out today's press release pasted below:

TORONTO, ONTARIO--(Marketwire - Dec. 9, 2009) - Vena Resources Inc. ("Vena" or the "Company") (TSX:VEM - News; LIMA:VEM - News; FRANKFURT:V1R - News) is pleased to announce that it has signed a definitive Joint venture agreement with Gold Fields, the third largest gold producer in the world, to create a new Peruvian company "NewCo" to jointly explore the Esquilache regional project 100% owned by Vena in southern Peru. "NewCo" rights will not include the historical San Antonio de Esquilache gold/silver mine that is currently undergoing a 3,000 meter drill program.

Under the terms of the joint venture, Gold Fields can earn an initial 51% interest in "NewCo" by spending US$1.5 million on exploration and maintenance within three years of the effective date of the joint venture agreement. Gold Fields can earn an additional 19% interest in "NewCo" by spending an additional US$3 million on exploration and maintenance within the subsequent three year period to bring its total interest to 70%. If Gold Fields does not complete the additional investment of US$3 million, its interest in "NewCo" will remain at 51%.

Further development of the project would be subject to normal straight line dilution clauses. Should either party dilute to below 15%, then it would exit with a 1% NSR. The "NewCo" owner would have the right to purchase one-half (or 0.5%) of this NSR interest for US$2 million.

Gold Fields will be the initial operator and full pre-emptive rights will apply in the case that either party wishes to assign or sell its interest in the joint venture or its rights to the NSR royalty to an unrelated party. The parties have agreed that NewCo's Management Committee will be comprised of two representatives of Vena Resources and two representatives of Gold Fields with Gold Fields having the casting vote.

Gold Fields is one of the world's largest unhedged producers of gold with attributable production of 3.6 million ounces(1) per annum from nine operating mines in South Africa, Ghana, Australia and Peru. Gold Fields also has an extensive growth pipeline with both greenfields and near mine exploration projects at various stages of development. Gold Fields has total attributable mineral reserves of 81 million ounces and mineral resources of 271 million ounces.

(1) Based on the annualized run rate for the first quarter of fiscal 2010.

Juan Vegarra, Chairman and CEO of Vena Resources commented,

"We welcome Gold Fields to the Esquilache region. Vena is very focused on drilling the historical Esquilache gold/silver mine while working with Gold Fields to explore the early-stage areas surrounding the historical mine. Access to geological knowledge and global expertise is what Vena looks for in any partnership. Gold Fields is the third global mining company that Vena has entered into a joint venture agreement with - the others being Cameco in Uranium and Glencore in Zinc."

The transaction remains subject to regulatory approvals.

To view the map associated with this Press Release please visit the following link: http://media3.marketwire.com/docs/VEM-1209.jpg

Statements in this press release regarding the Company's business which are not historical facts are "forward-looking statements" that involve risks and uncertainties, such as estimates and statements that describe the Company's future plans, objectives or goals, including words to the effect that the Company or management expects a stated condition or result to occur. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties. Actual results in each case could differ materially from those currently anticipated in such statements.

Shares Outstanding: 88,098,949

Fully-Diluted: 103,428,387

IKN catches up with Juan Vegarra, CEO of Vena Resources (VEM.to)

Juan Vegarra (for it is he)

In November last year, this humble corner of cyberspace ran an interview with Juan Vegarra, CEO of Vena Resources (VEM.to) (find it on this link here). At the time the stock price was down at 19c but Vegarra was keen to point out tht VEM.to wasn't about to turn its back on plans and go into hibernation.



So last week I had the chance to catch up with Vegarra and get the lowdown on developments at VEM.to. This interview was first seen by subscribers to The IKN Weekly last Sunday and it's now availble on the internetwebpipes for all to see. Enjoy.

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

IKN: Hello Juan thanks for taking the time to talk again.



Juan Vegarra: Interesting times for sure. Looks like we survived the global financial meltdown, but I am still a little worried about the US dollar and the credit markets – should be promising for the metals, especially gold. I know you may not agree, but we can have the finance debate on a different occasion or platform.



IKN: So what has been happening since we last spoke, apart from the quiet doubling of your share price (which is good)?



JV: There is no way you are going to get me to gloat on the current stock price. Remember we were at $1.91 not too long ago (although it feels like forever ago). I know our value is closely tied to zinc and uranium as those are the metals the market recognizes us for, but for the last 12 months we have been enhancing our precious metals portfolio as part of our mandate to maintain a diversified portfolio. We have two exciting projects – Pucara and Esquilache which are both gold/silver plays as well as the investment in the coal business that has kept a much smaller and focused team very busy lately.



IKN: Let's take things piece by piece, as Vena has a lot of irons in the fire. Of course you have to find a balance between what you can say in public and what you can't, but we'd like to know as much as possible about the current state of play in the following:



1: The uranium projects and the JV with Cameco

JV: Cameco, like everyone else in this industry, also has to manage the bottom line, so we went back to investing $2.5 million this year as originally agreed when we created Minergia, our joint exploration company in Peru. They have abandoned some JVs around the world but have kept the Vena deal going. That alone is a clear signal without me having to continue to emphasize we have a strong relationship which is getting stronger every year. After drilling over 12,000 meters last year at Macusani we have been doing a lot of “what if and what’s next” in Macusani. We knew we needed a strong manager and well experienced uranium geologist that can “live” in Puno and not in Lima. We hired an outstanding professional in David Bent. He ran a JV with Cameco in Canada before and we think David can do very well for us in Macusani. While we prepare the next drilling phase for Macusani we wanted to drill test Lagunillas. We knew the surface info was not as exciting as Macusani, but regardless it was worth doing 2,000 to 2,500 meters to test those targets. So what should you expect? A targeted drill campaign for Macusani for the next 18 to 24 months so we can get a better picture of possible resources with the goal of meeting Cameco’s uranium pound threshold.



2: Azulcocha, and plans now that zinc has rebounded a bit (along with the latest gold discovery there)

JV: If you base Azulcocha solely on zinc, as long as Zinc stays below 75c/lb I am not too keen to invest the dollars that are needed to build the mill and begin operations. The risk/reward is just not there when there are better opportunities in other parts of the business. BUT, if you fully understand the latest press release regarding finding gold on the sandstones then the picture changes dramatically for us. We are going to do some metallurgical tests to see if the gold in the sandstones is recoverable. If we get positive metallurgical results then we have a great future ahead for Azulcocha. I will tell you what we will do but remember it is all speculation right now. The first step will be to drill from surface to expand the lateral extends of the mineralization. So far we know dissemination exists near surface for more than 250 meters along strike. The second step will be to drill from the working level -40. This operating level already extends one kilometer underground, so we can fan up and down to test mineralization at depth. The third step will be to test other nearby targets where we have seen sandstones. “El Mono” is a hill right across the Azulcocha mine that we now know reported several gold anomalies in sandstones in previous exploration programs years ago. And finally, we will review core from the Azulcocha West program and see if we see similar occurrences. In summary, if the metallurgical tests are positive then spending money to delineate a 43-101 gold resource as part of the operating mine would be a no brainer. So expect us to discuss metallurgical tests before discussing the sandstone potential again.



3. The coal business you're putting together. How will it work, on the supply side and the demand side?

JV: There are two sides to this business; bituminous coal from Oyón in the Andes of Lima and anthracite coal in northern Peru. The anthracite business is the most interesting to me. We have completed a review of several coal projects in the Alto Chicama area in northern Peru and now have a solid understanding of the market inefficiencies so we can maximize our earnings. We have a clear idea of market dynamics (supply/demand, key Peruvian and international buyers, key properties, competition, market inefficiencies especially on the logistics end). The next step is for us to set up a coal classification facility in northern Peru which should generate significant cash flow for Vena in the short term. Coal classification can lead to washing coal which will increase our margin even more. We will not be releasing more numbers especially of a financial nature until we begin operations. You know this is standard venture capital work managing a start-up business. It would be nice to have some barriers to entry so we avoid people cloning our strategy as they did when we announced the uranium finds several years ago. So you need to be patient for a few more months with me on this subject.



4. What’s the latest on the Pucara gold project? Does the JV have a timeline to production there as yet?

JV: We received a very detailed report from Consorcio Minero Horizonte. It suggested we should drill further down to increase tonnage. We have reviewed the entire report and there is a good working relationship with CMH but no final deal has been signed as we are still working on several other fronts that may lead to a stronger (or no) relationship.

5. And finally, what about my personal favourite asset of Vena's, Esquilache? It seems to have been put on the back burner so any reason for that?

JV: Esquilache is also my favorite exploration project in our portfolio. It is very strategic to the future of Vena so there is more being done on this project that there is space in this interview. This project requires 5,000 to 10,000 meters of drilling NOW which is estimated to cost between US$1.5m and US$2m to start with, so I am “monetizing” other assets to raise enough funds to drill Esquilache without dilution at these low share price levels.



IKN: Final question: In last week's IKN Weekly I mentioned VEM as an example of a company that might benefit from the loosening in credit markets and the subsequent hunt by larger miners for cheap assets. Has VEM seen any evidence to suggest that is true recently? Is being asset rich (and relatively cash poor) becoming a positive as I imagine?



JV: I can only state what we are seeing as I’m not sure what is happening to other explorers in Peru. The answer is Yes, you are correct. We are seeing strong interest in reviewing our assets. Vena is asset rich and cash poor in comparison to previous years. We have signed several confidentiality agreements with third parties that may lead to something or nothing. The advantage we have is that we have accumulated plenty of assets over the last seven years in Peru that could be classified as non-core for now, like recoverable VAT or equipment that we can sell today without affecting short term deliverables, plus funds from our partners, so I am not going to a negotiating table with weak hands.



IKN: Thanks for your time, Juan. Any last words?



JV: I find the time to read IKN every day. I know you are very supportive of the company and I thank you for it. Peru is booming in comparison to the rest of the world. I know your comments regarding the Peruvian economy, but in comparison to the US where I live Peru’s economy looks strong. I think it is the first time the country is facing a global economic crisis with sufficient financial resources that should provide a cushion for Peru that it never had before. I see the performance of the Lima Stock Exchange as very beneficial to Vena. We (and other BVL juniors) are trading at five to six times more volume than we do in Toronto. The political climate is changing as elections are nearing, so the next 12 months should be even more interesting for all of us doing business in Peru.

Click here to visit the Vena Resources website

Chart of the day is............

.....Vena Resources 10 day price chart.

(Click to Enlarge)

I could have chosen the five day chart and we could have all gone "WOW, look at that for a win!" but to get a real idea of the stock we need to remember just how far it has fallen, so the 10 day variety is a more honest fit (pull up a 12 month chart and you'll see the almost constant selling and lower prices).

Yeah, it's one of my fave undervalued juniors. Yeah it's here again. Yeah I'm happy about the last few days' action because it has clearly broken a long-standing trend. Yeah I'm pleased that the stock seems to have reacted well to the interview with CEO Vegarra over the weekend (any other CEOs want to come and play?....free publicity, dudes and dudettes :-). And for sure you have your own fave smallcaps too, but hey.....this is my blog.

Final thought: I do like it when management puts their own personal money where its mouth is. Here's the latest insider trading report on Vena Resources:

Nov 03/08	Oct 31/08	Vegarra, Juan	Direct Ownership	Common Shares	11 - Acquisition carried out privately	360,000	$0.100 USD
Nov 03/08	Oct 30/08	Vegarra, Juan	Direct Ownership	Common Shares	10 - Acquisition in the public market	5,000	$0.135 USD
Oct 30/08	Oct 29/08	Vegarra, Juan	Direct Ownership	Common Shares	10 - Acquisition in the public market	10,000	$0.092 USD
Oct 30/08	Oct 29/08	Vegarra, Juan	Direct Ownership	Common Shares	10 - Acquisition in the public market	10,000	$0.100 USD
Oct 27/08	Oct 27/08	Ogilvie, Rodney	Direct Ownership	Common Shares	10 - Acquisition in the public market	20,000	$0.120