<a href=www.vheadline.com>Venezuela's Electronic News Posted: Monday, June 16, 2003 By: Patrick J. O'Donoghue

At a press conference Primero Justicia (PJ) National Assembly (AN) deputy, Julio Borges has challenged his Movimiento Quinta Republica (MVR)  "colleagues" to draw up an AN agenda that really helps Venezuela advance and avoid a parliamentary crisis. 

It is not clear whether Borges, who studied in Oxford (UK), is holding out an olive branch or just trying some free PR to get one better than his opposition colleagues, who seem to have abandoned the recall referendum as top priority for the usual shortcuts or quick fixes to topple President Hugo Chavez Frias. 

Borges criticizes the government bench's agenda as "saying nothing to the country ... the Anti-Terrorist, Supreme Tribunal of Justice (TSJ), and Media Content laws are not priority." PJ, Borges insists, is pushing for the passing of an employment protection, national production, national police, and barrio slums laws. 

When Parliament opens on Tuesday, PJ will motion for the employment protection, national production and national police laws. Borges says all the current laws are protecting the few privileged Venezuelans that are lucky to have jobs and warns that the government has condemned national companies that have been made bankrupt by importing products, violating Andean Union (CAN) agreements. 

The government's alphabetization program is criticized because of the number of Cuban teachers that have been employed in detriment to Venezuelan professionals.

Borges did not specify whether his party would enter in alliance with MVR, if the latter accepts PJ's proposal or whether his opposition colleagues would back the proposals. It appears that PJ has placed the recall referendum on the backburner, despite an earlier pledge to collect signatures before August 19.

By Thom Calandra, CBS.MarketWatch.com Last Update: 2:00 PM ET June 16, 2003

SAN FRANCISCO (<a href=cbs.marketwatch.com>CBS.MW) -- This is for the folks with the $5 trillion of money-market funds throwing pennies into the jars of investors.

THE CALANDRA REPORT Get profit-seeking strategies from Thom Calandra based on interviews with experts, research, analysis, and market-moving insight. Subscribe today!

The world over, investors are engaged in a search for greater and greater returns, especially against paltry yields from money markets and other cash-linked deposits.

Pimco, which manages assets in excess of $100 billion, says that "enhanced cash investments," or a mix of short and longer-term debt securities across different investment grades, can dramatically improve returns.

All you have to do is learn to live with a little volatility in the bond markets.

Or the currency markets.

Investors of late have been looking outside the U.S. for higher-yielding certificates of deposit. A 6-month certificate of deposit in Australia, for example, yields about 4 percent, far more than a similar one in the U.S.

But back to the bond market. "Two tough years for bonds were 1994 and 1999. During both periods, the U.S. economy was strong and interest rates rose, hurting bond performance," say Paul McCulley and Paul Reisz of Pimco, which specializes in fixed-income securities.

The two managers, who are part of Pimco's enhanced cash team, say investors seeking alternatives to that 1 percent money-market deposit might consider a selection of so-called ultra-short debt maturities, those of six years and less.

During the rocky bond market in '94 and '99, for instance, ultra-short and short investment-grade bonds, and short municipal debt strategies performed positively, they say. "The ultra-short strategy had slightly stronger performance as a result of its shorter duration or reduced exposure to interest rate risk."

A word of caution for those who think they easily can triple their money market returns with little or no risk: They can't. Creating a mix of laddered maturities in a portfolio is wise for supplementing an investor's cash allocation over five or more years, the two money managers say.

"Over the past five years, for example, taxable money market funds, as tracked by Lipper, returned 4.16 percent, while ultra-short funds returned 4.74 percent and short investment-grade funds 5.49 percent," say McCulley and Reisz. This is the kind of difference investors feel in their wallets, especially in the long run."

The article by the Pimco money managers was published in Investment Advisor Magazine.

The Calandra Report

I'll have more in The Calandra Report later this week on several fronts, including an exclusive natural gas story that may become one of the world's most sought-after investments. I'll also have more on the takeover drama unfolding around Crystallex International (KRY: news, chart, profile).

The miner told the Toronto Stock Exchange on Monday it knew of no corporate reason for a nearly 100 percent gain in the company's shares over a week. The gains came in trading activity that was three to six times average daily volumes for the company's American Stock Exchange and Toronto-listed shares.

Last week's edition of subscription service The Calandra Report examined Crystallex's efforts to develop Venezuela's Las Cristinas, one of the world's largest proven, and untapped, gold reserves. On Monday, Gold Mining Stock Report's Robert Bishop, quoted at length last week in newsletter The Calandra Report, reiterated his belief the Toronto-based company will receive a takeover offer, or some other backing from a big company, and soon.

"Venezuela's National Assembly has now said on four occasions that Crystallex has legally been designated to be the operator of Las Cristinas (foreign companies never own projects in Venezuela, they obtain rights to operate projects)," Bishop said Monday morning.

"Las Cristinas is simply too large a gold deposit selling at too low a price to escape the attention of larger companies," Bishop, one of the longest-running and most highly regarded gold-mining strategists in North America, told his subscribers.

"My observation about some party moving on Crystallex by the time of the company's annual meeting (in another week) is more an observation that management needs to be in a position to offer the prospect of a future that's markedly different from the past, or risk the open revolt of its shareholders."

Bishop, speaking to me from his California office, said Crystallex chief executive Marc Oppenheimer was seen attending the shareholder annual meeting of Glamis Gold (GLG: news, chart, profile) in recent weeks. His attendance at the larger gold company's May 7 Toronto meeting may be sparking speculation in the shares, says Bishop, who believes at least one mining company is conducting due diligence on Crystallex.

I placed a call Monday to Oppenheimer, with whom I spoke last week in San Francisco. I also placed a call to a company spokesman, A. Richard Marshall. On Monday afternoon, Marshall told me he would contact Oppenheimer. Marshall said the company's executives sometimes attend other gold miners' shareholder events to monitor the industry.

Nevada-based Glamis produces gold from mines in Nevada, Mexico and Central America. The company produced 251,000 ounces last year and says in its corporate presentations that it hopes to double that amount.

Those who read The Calandra Report know exactly where I stand on the Crystallex story. As Bishop said, the stock market is valuing a roughly 21-million-ounce Las Cristinas resource, some 9.5 million ounces of that considered a proven reserve, at roughly $5 to $6 an ounce. Crystallex International shares Monday afternoon were selling for $1.76 on the American Stock Exchange and $2.34 Canadian (CA:KRY: news, chart, profile) on the Toronto Exchange. Thom Calandra's StockWatch is CBS MarketWatch's flagship column. The regular report is in its eighth year at CBS.MarketWatch.com. Thom Calandra is also author of subscription service The Calandra Report.

<a href=ogj.pennnet.com>Oil & Gas Journal, By Curtis Williams OGJ Correspondent

PORT OF SPAIN, June 16 -- A jointly hosted Western Hemispheric Energy Summit, slated for Trinidad and Tobago this fall, will focus on natural gas, and participates will discuss supply-demand scenarios for the next decade, Energy Minister Eric Williams said.

The summit will hosted by the governments of Trinidad and Tobago and the US.

The US is keen to ensure that it can count on predictable supplies of gas in keeping with its strategic move away from over dependence on potentially unstable Middle East supplies, Williams said.

Trinidad and Tobago, already the largest LNG exporter to the US, is seen as an important future supplier to satisfy a rapidly growing US LNG market.

Members of the 15-member Caribbean regional economic union (Caricom) are going to be invited along with OLADE (Latin American Energy Organization.). Venezuela belongs to OLADE.

Venezuela has been trying to get into the LNG business and has been working closely with Trinidad and Tobago.

"We can be the catalyst that brings all these groups together to come up with a hemispheric position on short- and long-term energy issues," Williams said. Various issues being studied by the Caribbean Hydrocarbons Cooperation Commission also might be discussed.

Topics could include LNG regasification plants in the Caribbean basin and a cost-cap on petroleum products sold to Caricom countries by Trinidad and Tobago and Venezuela.

"If we are going to look at long-term energy supplies into the US, which we all agree is our major market, and we are looking at the supply position from the perspective of the gas-producing countries, it makes sense for the suppliers and demanders to get together and talk," Williams said.

06/16/2003 - Source: <a href=www.latintrade.com>BNamericas-LatinTrade Venezuela's state oil company PDVSA will soon start to award oil field maintenance contracts to reverse declining production at its oil fields, industry sources told BNamericas. "One thing that has suffered a lot since they downsized significantly has been the quality of operational maintenance," one source said, asking not to be named. "That is very worrisome for PDVSA." "Maintenance levels are not at the same levels as before the strike," said a different source, Fernando Delgado, executive director of the Zulia state branch of Venezuela's national oil chamber. PDVSA is considering awarding contracts to joint ventures of Venezuelan and foreign companies, Delgado said, adding "this would be good for the country, and reactivate the sector with private capital." Awarding these contracts to private companies would not necessarily mean privatizing the operations of state oil fields, "but we could start with maintenance contracts on small fields and then move to larger fields," the first source said. "PDVSA is not going to give everything away, but just a part," the source said, adding, "It seems this idea has been received well by PDVSA management." Delgado said construction companies in the west of the country, where PDVSA is the main client, have been operating at 20% of capacity since the end of the oil strike in February. "Activity is considerably less than it was," he said. "PDVSA officials say it's because before the strike they were spending too much money on maintenance contracts, but it's impossible for me to check that," Delgado added. For now the lower levels of maintenance have not resulted in any serious accidents, such as oil spills or gas explosions, Delgado continued, adding that if maintenance does not improve such accidents will become more likely in the future. PDVSA faces an "emergency" in declining oil production, the source said, adding "The reality is that there are almost two worlds, because the expectation is that there has been recovery since the strike, but in the last week and a half we're starting to hear that production is rapidly declining." "There is a perception that production is heavily declining now. That reality is sinking in and they are having serious problems with maintenance which in turn impacts production," the source continued. Another reason for declining production could be that PDVSA overproduced some good prospects after the strike, "but that's always a bad industry practice because when you overproduce you will never reach optimum economic recovery," the source said. However, the oil chamber's Delgado said that there is a natural 20% annual decline in oil fields and poor maintenance now will affect future production, not current production. PDVSA chairman Ali Rodriguez said on Wednesday that the company is currently producing at its OPEC quota of about 2.9 million barrels of oil a day. "The official numbers are pretty good," Delgado said, adding that current production is within 100,000b/d of pre-strike levels. Because half the workforce was sacked during and after the two-month strike at the beginning of the year, PDVSA has appointed political allies or lower level employees loyal to President Hugo Chavez, the source said. "Some people believe the problems are here to stay because they have cut the company so thin in terms of employees and personnel that it will be hard to handle a company this size with a 45% cut in the payroll and believe that everything's going to fine and dandy," the source continued.

Reuters, 06.16.03, 12:23 PM ET    TORONTO, June 16 (<a href=>Reuters) - Crystallex International Corp.'s <KRY.TO> <KRY.A> shares rose more than 20 percent on Monday before retreating, and an analyst cited a report in a newsletter suggesting the gold miner may be a takeover target. Its shares were up 10.68 percent, or 25 Canadian cents, to C$2.59 on the Toronto Stock Exchange on Monday morning on hefty volume of 929,013 shares. The shares had climbed as high as C$2.86. The stock has been heavily traded since early June, enjoying some of its busiest sessions in almost two years. Since June 6, it has risen 110 percent. At the prompting of the Toronto Stock Exchange, the company issued a brief statement on Monday that it was "unaware of any corporate developments which would account for the recent increase in its stock price and trading volume." One market analyst said there was acquisition chatter about the company in recent weeks. He said the rumors had been fueled by remarks in a market newsletter. "There's been lots of talk of takeover activity...the stock is very cheap," said John Ing, president of Maison Placements Canada. "The stock has in the last week traded more than 10 million shares, I think, on this rumor. Whether it's true or not, who knows? But that's the rationale for it moving." Crystallex spokesman Richard Marshall said the company does not comment on rumors. Crystallex has operations in Uruguay and in Venezuela, where it won a contract to operate the Las Cristinas mine last year -- one of the world's largest undeveloped gold deposits -- after years of legal wrangling. "Fundamentally, the stock has been undervalued," Ing said. "There have been ownership question marks. But those ownership question markets have been cast aside as the Venezuelan government itself has made known that there is no question...as to the Crystallex ownership of Las Cristinas." ($1=$1.34 Canadian)