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FREQUENTLY USED ABBREVIATIONS AND ACRONYMS
Additional Facility Rules ICSID Additional Facility Rules as amended in April 2006
Arbitration Rules Arbitration (Additional Facility) Rules
BIT or Treaty July 1996 Agreement between the Government of Canada and the Government of the Republic of Venezuela for the Promotion and Protection of Investments, which entered into force on 28 January 1998
C-PHB Claimant's Post-Hearing Brief dated 12 May 2014
Claimant or Crystallex Crystallex International Corporation
C-Supplemental Submission on Quantum Claimant's Supplemental Submission on Quantum in Response to the Tribunal's 25 July 2014 Questions dated 12 September 2014
Counter-Memorial Respondent's Counter-Memorial on jurisdiction and the merits dated 21 November 2012
ER Iribarren Legal Opinion of Dr. Henrique Iribarren Monteverde dated 13 September 2013
ER Meier Expert Report on Venezuelan Law of Professor Henrique Meier Echeverrí dated 9 May 2013
ER Muci Expert Report on Venezuelan Law of Professor José Antonio Muci Borjas dated 9 May 2013
ER Pearson Expert Report of Mr. Thomas Pearson dated 17 September 2013
Exh. [C] [R] Exhibit [Claimant] [Respondent]
Exh. [CLA] [RLA] Legal Authority [Claimant] [Respondent]
First Expert Mining and Environmental Report Mining and Environmental Expert Report of Dr. Richard Jolk, Dr. Ronald Cohen and Dr. David Snow dated 9 May 2013
First ER ENVIRON Environmental Expert Report by Mr. Reed Huppmann, Dr. Robert Langstroth and Ms. Sharon Maharg dated 10 May 2013
First ER Dagdelen Expert Mining Report of Professor Kadri Dagdelen dated 21 November 2012
First ER Ellis Expert Report of Mr. Trevor Ellis dated 9 February 2012
First ER Hart Damages Report of Mr. Timothy Hart dated 21 November 2012
First ER Lexecon Expert Report on Damages of Compass Lexecon dated 10 February 2012
First ER OptiTech Environmental and Social Expert Report of OptiTech Engineering Solutions, Inc. dated 21 November 2012
First ER de los Ríos Expert Report of Professor Isabel de los Ríos dated 21 November 2012
First WS of J.C. Palazzi First Witness Statement of Juan Claudio Palazzi dated 10 February 2012
First WS of L.F. Cottin First Witness Statement of Luis Felipe Cottin dated 10 February 2012
First WS of L. Paredes First Witness Statement of Laura Paredes dated 7 November 2012
First WS of M. González First Witness Statement of Manuel González Díaz dated 16 November 2012
First WS of P. Romero First Witness Statement of Pedro Romero dated 9 November 2012
First WS of R.A. Fung First Witness Statement of Robert A. Fung dated 10 February 2012
First WS of R. Olivares First Witness Statement of Ramón Olivares dated 15 November 2012
First WS of S. El-Alfy First Witness Statement of Sadek El-Alfy dated 10 February 2012
First WS of S. Rodríguez First Witness Statement of Sergio Rodríguez dated 18 November 2012
First WS of S. Alcalá First Witness Statement of Sergio Alcalá dated 10 February 2012
ICSID or the Centre International Centre for Settlement of Investment Disputes
Memorial Claimant's Memorial on the Merits, dated 10 February 2012
R-PHB Respondent's Post-Hearing Brief dated 12 May 2014
Rejoinder Respondent's Rejoinder on Jurisdiction and the Merits dated 18 September 2013
Reply Claimant's Reply Memorial on Jurisdiction and the Merits dated 9 May 2013
Respondent or Venezuela Bolivarian Republic of Venezuela
R-Supplemental Submission on Quantum Respondent's Supplemental Submission on Quantum in Response to the Tribunal's 25 July 2014 Questions dated 31 October 2014
Second ER Dagdelen Second Expert Mining Report of Professor Kadri Dagdelen, dated 17 September 2013
Second ER Ellis Second Expert Report of Mr. Trevor Ellis dated 9 May 2013
Second ER Hart Second Damages Report of Mr. Timothy Hart dated 17 September 2013
Second ER Lexecon Second Expert Report on Damages of Compass Lexecon dated 9 May 2013
Second ER OptiTech Second Environmental and Social Expert Report of OptiTech Engineering Solutions, Inc. dated 17 September 2013
Second ER de los Ríos Second Expert Report of Professor Isabel de los Ríos dated 18 September 2013
Second WS of J.C. Palazzi Second Witness Statement of Juan Claudio Palazzi dated 9 May 2013
Second WS of L.F. Cottin Second Witness Statement of Luis Felipe Cottin dated 9 May 2013
Second WS of L. Paredes Second Witness Statement of Laura Paredes dated 29 August 2013
Second WS of M. González Second Witness Statement of Manuel González Díaz dated 16 September 2013
Second WS of P. Romero Second Witness Statement of Pedro Romero dated 14 August 2013
Second WS of R.A. Fung Second Witness Statement of Robert A. Fung dated 9 May 2013
Second WS of R. Olivares Second Witness Statement of Ramón Olivares dated 8 September 2013
Second WS of S. El-Alfy Second Witness Statement of Sadek El-Alfy dated 9 May 2013
Second WS of S. Rodríguez Second Witness Statement of Sergio Rodríguez dated 18 September 2013
Second WS of S. Alcalá Second Witness Statement of Sergio Alcalá dated 9 May 2013
Third ER Hart Third Damages Report of Mr. Timothy Hart dated 31 October 2014
Third ER Lexecon Third Expert Report on Damages of Compass Lexecon as revised 15 September 2014
Tr. [Jurisdiction and Merits] / Tr. [Supplemental Quantum ] [page:line] Transcript of the hearing on jurisdiction and on the merits / Transcript of the supplemental hearing on quantum
WS of J.S. Khan Witness Statement of José Salamat Khan Fernández dated 16 September 2013
WS of R. Roa Witness Statement of Rodolfo Roa Delgado dated 15 August 2013
WS of C. Rodríguez Witness Statement of Charly Rodríguez dated 10 September 2013

I. OVERVIEW OF THE DISPUTE

1.
This case concerns a dispute submitted to the International Centre for Settlement of Investment Disputes ("ICSID" or the "Centre") on the basis of the July 1996 Agreement between the Government of Canada and the Government of the Republic of Venezuela for the Promotion and Protection of Investments (the "BIT"), which entered into force on 28 January 1998, and the ICSID Additional Facility Rules as amended in April 2006.
2.
The Claimant is Crystallex International Corporation and is hereinafter referred to as "Crystallex" or the "Claimant." Crystallex is represented in this arbitration by Messrs. Nigel Blackaby, Lluís Paradell and Mrs. Caroline Richard, from the law firm Freshfields Bruckhaus Deringer US LLP in Washington, D.C., Mr. Luis Guerrero, from the law firm Wallis & Guerrero in Caracas, and Mr. Eduardo Travieso Uribe from the law firm Travieso Evans Arria Rengel & Paz in Caracas.
3.
The Claimant is a company incorporated under the laws of Canada.
4.
The Respondent is the Bolivarian Republic of Venezuela and is hereinafter referred to as "Venezuela" or the "Respondent". Venezuela is represented by Dr. Reinaldo Enrique Muñoz Pedroza, Viceprocurador General de la República and, since 25 September 2011, by Dr. Ronald E.M. Goodman, Messrs. Paul S. Reichler and Alberto Wray from the law firm Foley Hoag LLP, Washington, D.C. Before 25 September 2011, Venezuela was represented by (a) Mr. Paolo di Rosa and Ms. Gaela Gehring Flores from the law firm Arnold & Porter LLP in Washington, D.C. and (b) Messrs. Luis Torres Darias and Antonio Guerrero Araujo, from the law firm Torres Darias & Asociados in Caracas.
5.
The Claimant and the Respondent are hereinafter collectively referred to as the "Parties".

A. INTRODUCTION

6.
The present dispute arises out of certain measures taken by Venezuela which, according to the Claimant, have wrongfully affected the Claimant's investment in the areas called "Las Cristinas". Las Cristinas is reported to contain one of the largest undeveloped gold deposits in the world and is divided into four mining concessions, Cristina 4, 5, 6, and 7, which are located within the municipality of Sifontes in the State of Bolívar in the Guayana region in southeast Venezuela. The Las Cristinas site borders the Cuyuni River, is approximately 6 km west of the village of Las Claritas and 20 km from the border of Guyana, and sits in the Imataca National Forest Reserve.
7.
The Claimant contends that through its actions and omissions vis-à-vis Crystallex, Venezuela has breached several of its obligations under the Agreement between the Government of Canada and the Government of the Republic of Venezuela for the Promotion and Protection of Investments (the "BIT" or the "Treaty").1 It particularly points to Venezuela's April 2008 denial of a permit to Crystallex to exploit the gold deposits at Las Cristinas, and of the rescission by the Corporación Venezolana de Guayana (the "CVG"), a state-run corporation tasked with stimulating economic activity in the Guayana region, of the Mine Operation Contract ("MOC") in February 2011.
8.
This Section (Section I) provides a general recollection of the main facts underlying the dispute. It only purports to put the dispute in its context, rather than to provide an exhaustive description of all the events relevant for the dispute. Further factual circumstances will be described in more detail when dealing with the Parties' positions (Section IV).

B. EARLY DEVELOPMENTS IN LAS CRISTINAS

9.
The following paragraphs summarize the main developments in Las Cristinas which occurred before Crystallex was involved in the site.
10.
In 1964, the concession titles for Las Cristinas were issued to Ms. Dot Culver de Lemon for a period of 25 years.2 However, Ms. de Lemon did not carry out any industrial mining operations at the site. According to the Claimant, from the early ‘80s a significant number of illegal miners began working the gold deposits using techniques that caused deforestation and pollution at Las Cristinas.3 In 1986, the Cristinas 4 and 6 concessions were transferred to Inversora Mael C.A. ("Inversora Mael"). This transfer gave rise to litigation with the Ministry of Mines, which resulted in a 1991 Supreme Court decision in favor of Inversora Mael.4
11.
However, according to the Claimant competing rights over Las Cristinas ensued when the Ministry of Mines, under Presidential Decree 1409 of 1990, empowered the CVG to execute contracts with third parties for the exercise of mining rights in the Guayana region of Venezuela.5 On this basis, in June 1991, the CVG entered into a joint venture with the Canadian mining company Placer Dome Inc. ("Placer Dome") initially to explore and, if economically feasible, produce gold at Las Cristinas. The newly established company, Minera Las Cristinas, S.A. ("MINCA") was owned 30% by the CVG and 70% by Placer Dome.6 The CVG and MINCA subsequently concluded a contract to explore and exploit Las Cristinas for an initial period of 20 years.7 Despite MINCA having later obtained all the necessary permits from the Ministry of Mines and the Ministry of Environment, exploitation of the mines never commenced.8
12.
On 2 March 1997, according to the Claimant, Crystallex purchased Inversora Mael for a total purchase price of US$30 million, and asserted Inversora Mael's competing rights over Las Cristinas in Venezuelan courts.9
13.
In July 2001, Placer Dome sold its shares in MINCA to the Canadian Company Vannessa Ventures Ltd.10 The CVG and the Ministry of Mines refused to recognize the transfer. In November 2001, the CVG terminated the MINCA contract, as a consequence of which all rights over Las Cristinas reverted to the State.11
14.
On 29 April 2002, then President Hugo Chávez issued Decree 1757, whereby he reserved to the Venezuelan State the exercise of mining activities at Las Cristinas, declaring them as a matter of "priority for the Republic" and authorizing the Ministry of Mines to contract with the CVG to that effect.12

C. THE CONCLUSION OF THE ADMINISTRATIVE AGREEMENT AND MINE OPERATION CONTRACT IN 2002

15.
On 16 May 2002, the Ministry of Energy and Mines (the "Ministry of Mines")13 and the CVG entered into an agreement (the "Administrative Agreement between the Ministry of Energy and Mines and the CVG with respect to Las Cristinas Deposits", hereinafter the "Administrative Agreement").14 The Administrative Agreement was executed on the basis of Decree No. 1757 of 29 April 2002.15
16.
Pursuant to the Administrative Agreement, the Ministry of Mines "authorize[d] [the CVG] to explore, exploit and sell the gold mineral found in the deposits located in the areas of the concessions identified as Cristina 4, Cristina 5, Cristina 6 and Cristina 7, in the municipality of Sifontes in the Bolívar State [...]".16 It also authorized the CVG to enter into contracts with third parties subject to prior notification to the Ministry of Mines.17
17.
In May 2002, following the conclusion of the Administrative Agreement, the CVG met with several companies, including Crystallex, to discuss the prospects of developing Las Cristinas.18
18.
On 2 September 2002, the Board of Directors of the CVG approved the execution of the future MOC with Crystallex.19 On 17 September 2002, Crystallex and the CVG concluded the MOC, which laid out the framework of rights and responsibilities of the parties for the development of Las Cristinas.20 Under the MOC, Crystallex was required to bear all responsibility for the development of the Las Cristinas project and all of its associated costs,21 proceed with the construction of the agreed social works22 and make an initial payment of US$15 million, while being entitled to the proceeds deriving from the sale of its gold production, subject to payment of a sliding royalty to the CVG and all applicable taxes required under Venezuelan law.23
19.
For its part, the CVG assumed the obligations of, inter alia, securing the permits required for the development of the project24 and of issuing and processing all notices to the Ministry of Mines required in connection to the MOC.25 According to Clause 17.4 of the MOC, "[t]he [CVG] shall be in charge of the formalities before the Ministry of Environment and Natural Resources".
20.
The MOC provided for an initial duration of 20 years, which was extendable for two 10-year periods, for a maximum lifetime of 40 years.26

D. THE PERMITTING PROCESS BETWEEN 2003 AND 2008

21.
To start operating Las Cristinas, Crystallex27 had to obtain a number of authorizations and permits from Venezuelan entities. In particular, it had to obtain an Authorization to Affect Natural Resources (Autorización Para Afectar Recursos Naturales) from the Ministry of Environment (the "AARN", by its Spanish initials, or the "Permit").28 The following steps were necessary for the Permit to be granted:

a. Crystallex had to obtain a Land Occupation Permit issued by the Ministry of Environment;29

b. Crystallex had to prepare and submit a Feasibility Study for approval to the CVG and the Ministry of Mines, setting out in detail a project that was geologically, technically and financially sound;30

c. Crystallex had to prepare and submit an Environmental Impact Study ("EIS") to the CVG for approval to the Ministry of Environment, which would address the project's effects on the environment.31

d. Crystallex had to post a construction compliance guarantee bond (the "Bond")32 and pay certain environmental taxes.

1. The Land Occupation Permit

22.
The Land Occupation Permit was originally obtained by the CVG from the Ministry of Environment on 26 April 1993. Subsequently, the Ministry ratified its validity on 26 June 1997, 18 March 2002 and in August 2004.33

2. The Feasibility Study

23.
In February 2003, Crystallex retained the mine engineering and geology consulting firms SNC-Lavalin and Mine Development Associates ("MDA") to prepare a technical, economic and financial study (the "Feasibility Study") for the Las Cristinas project, in accordance with its obligation under clause 2.2 of the MOC.34
24.
On 10 September 2003, Crystallex submitted the Feasibility Study to the CVG.35 The report assumed an ore production rate of 20,000 tpd.36 On 7 October 2003, the CVG requested additional information from Crystallex, including information on the water deviation channel to control surface water and its possible influence on the neighboring Las Brisas concessions, as well as the submission of a new EIS of the project in order to comply with the current Venezuelan regulatory framework and Clause 9 of the MOC.37
25.
During a meeting held on 29 October 2003, the CVG requested additional clarifications of particular technical information. Crystallex informed the CVG that it believed it could "substantially increase production in years 4 or 5 to 40,000 tonnes per day reducing the mine life to 17 years".38 In addition, Crystallex confirmed, inter alia, that the updated EIS would discuss the socio-economic impact of the project and outline the associated costs.39
26.
On 4 December 2003, the CVG noted that the parties had agreed upon an initial production rate of 20,000 tpd for the first three years, after which the project would expand to accommodate 40,000 tpd.40
27.
On 19 December 2003, Crystallex submitted to the CVG a set of "Additional Clarifications" (Aclaraciones Adicionales), illustrating its plans to increase production from 20,000 to 40,000 tpd by year 8 of the project.41 On 9 January 2004, the CVG asked Crystallex to state that it would expand to 40,000 tpd by year 4, instead of year 8.42 On 16 January 2004, Crystallex submitted Addendum 1 to the Feasibility Study, in which it explained that for financing reasons, the Feasibility Study had to state that expansion would occur in year 9, although it was likely that the expansion could happen earlier.43 The same financing concerns underlying an expansion plan only as of year 9 were reiterated by Crystallex in a letter to the CVG dated 5 February 2004.44
28.
On 8 March 2004, the CVG approved the Feasibility Study,45 and on 15 April 2004 it sent the document to the Ministry of Mines for its review and approval.46
29.
The Ministry of Mines made comments and requested changes to the Feasibility Study by way of a letter to the CVG of 23 December 2004,47 which the CVG forwarded to Crystallex on 5 January 2004.48 Crystallex reportedly replied to those requests in February 2005.49
30.
Further exchanges of correspondence between Crystallex and the Ministry of Mines followed between February and December 2005.50
31.
In the meantime, further documents were prepared by Crystallex. In August 2005, SNC-Lavalin submitted to the Ministry of Mines the 2005 Development Plan for Las Cristinas.51 In October 2005, SNC-Lavalin prepared a 20,000 to 40,000 tpd expansion plan, which called for an initial throughput of 20,000 tpd starting in February 2007, with an expansion to 40,000 tpd after two years.52
32.
On 6 March 2006, the Ministry of Mines approved Crystallex's Feasibility Study, which had been submitted by the CVG to the Ministry on 15 April 2004.53

3. The Environmental Impact Study

33.
The EIS was prepared by SNC-Lavalin for Crystallex and was submitted in December 2003 to the CVG.54 On 15 April 2004, the same day it submitted to the Ministry of Mines the Feasibility Study, the CVG delivered the EIS55 to the Ministry of Environment, together with its request for the Permit.56
34.
A period of discussions between Crystallex and the CVG, on one side, and the Ministry of Environment, on the other, followed the submission of the EIS. After an environmental inspection of the Las Cristinas area on 11 and 12 May 2004,57 Crystallex and the CVG made a presentation of the EIS to the Ministry of Environment.58 Some of these discussions addressed the plan to alter the flow of three streams that ran through Las Cristinas by means of a river diversion channel.59
35.
On 1 July 2004, the Ministry of Environment sent a letter to the CVG with a series of questions,60 to which the CVG replied on 12 July 2004.61 On 20 July 2004, the CVG contacted the Ministry of Environment to reiterate its request for approval of Crystallex's EIS.62 In the second half of 2004, Crystallex provided a number of Addenda to the EIS, addressing the Ministry of Environment's concerns,63 as well as an Environmental Supervision Plan (to be implemented during the construction phase of the project).64
36.
On 29 December 2004, the Ministry of Environment requested that the CVG and Crystallex reformulate the project, noting that the study had been presented without prior terms of reference.65 However, in early 2005, according to the Claimant, the newly appointed Minister of Environment, Ms. Jacqueline Faria, expressed the position that the project's existing terms of reference would remain in place,66 and scheduled a series of workshops with Crystallex and the CVG in order to discuss the outstanding technical issues.67
37.
In March 2006, at the request of the Ministry of Environment, Crystallex resubmitted all of the documentation related to the approval of the EIS.68 In February and April 2007, Crystallex provided answers to additional concerns that had been raised by the Ministry.69
38.
On 16 May 2007, the Ministry of Environment, through its then Vice-Minister of Environmental Administration and Governance, Merly Garcia, sent a letter to Crystallex, requesting the payment of a bond which was to "guarantee the implementation of the measures proposed in the document presented for the Environmental Impact Evaluation of the project, which have been analyzed and approved by this Office [...]".70
39.
The meaning and import of the Ministry of Environment's letter of 16 May 2007 are disputed between the Parties.71
40.
On the same day, Ms. Merly Garcia submitted a letter to the CVG, asking the CVG to pay a fee for the issuance of the Permit.72
41.
On 18 May 2007, Crystallex posted the Bond at the Office of Environmental Permits in Caracas, and paid the environmental taxes.73
42.
On14 June 2007, Crystallex announced to the market that it had fulfilled the requirements for receiving the Permit.74
43.
On 31 October 2007, the CVG wrote to the Ministry of Environment to inquire about the status of the Permit, and referred to the Ministry of Environment's letter of 16 May 2007 stating that the Permit would be handed over once the procedural requirements would be complied with by Crystallex.75

E. THE DENIAL OF THE PERMIT IN APRIL 2008

44.
On 14 April 2008, the Director General of the Administrative Office of Permissions of the Ministry of Environment informed the CVG that the request for the Permit was denied.76 The reasons put forward by the Ministry of Environment included concerns for the environment and the indigenous peoples of the Imataca Forest Reserve.
45.
According to the Claimant, the CVG received the Permit denial on 28 April 2008, and informally made Crystallex aware of that decision on the same day.77 Crystallex formally acknowledged its awareness of that decision on 5 May 2008.78
46.
On 12 May 2008, Crystallex formally asked that the Permit request be reconsidered by filing a motion for reconsideration (Recurso do Reconsideración) before the Director General of the Office of Permits of the Ministry of Environment.79 On 28 May 2008, the Ministry of Environment declared Crystallex's motion for reconsideration inadmissible, on the basis that Crystallex lacked standing to file the appeal.80 The Director General also reaffirmed his rejection of the CVG's application for the Permit. Crystallex appealed the Director General's ruling on 17 June 2008, by means of a hierarchical appeal (Recurso Jerárquico) to the Minister of Environment.81 It is undisputed between the Parties that the Minister of Environment did not rule on the appeal, although the Parties disagree on the legal implications of such omission.

F. MAIN EVENTS FROM THE PERMIT DENIAL TO THE MOC RESCISSION

47.
On 4 June 2008, Crystallex appeared at a public hearing of the National Assembly's Permanent Committee for Economic Development.82
48.
On 4 August 2008, Crystallex submitted to the Ministry of Environment a report entitled "Proposals for Sustainable Development, Development Alternatives and Minimizing the Environment Impact of the ‘Las Cristinas' Project".83
49.
In response to Crystallex's report of 4 August 2008, the Ministry of Environment informed Crystallex on 20 August 2008 that:

"[…] having fully studied the body of ideas proposed in the aforementioned document, which tend to adhere to Government guidelines in both environmental and social matters, this Office considers the evaluation by our technicians to be useful in making a decision regarding whether to take on the "Las Cristinas" Gold Project".84

50.
However, on 19 September 2008, President Chávez stated in a public address that:

"In Guayana for example, we are taking back big mines, and one of them is one of the biggest in the world. And do you know what it is? It's gold, it's gold!"85

51.
On 5 November 2008, the Minister of Mines, Mr. Rodolfo Sanz, expressed the intention to nationalize Las Cristinas:

"[…] by 2009, the State will take back, operate and manage the Las Cristinas mine, previously owned by Cristalex [sic], an international company".86

52.
Further, according to a 6 November 2008 report by Reuters, Minister Sanz announced that Venezuela would sign an agreement with Rusoro Mining Ltd. ("Rusoro"), a Russian-managed mining company, to build and operate a mine at Las Cristinas through a joint venture with the Venezuelan Government.87 Minister Sanz added that: "[w]e have to rescind our relationship with a company that has been working in the zone. We have a legal problem there".88
53.
On 24 November 2008, after having written a number of letters to the Ministry of Mines,89 Crystallex notified the Ministry of Mines of a dispute under the Treaty between Crystallex and Venezuela (the "Notice of Dispute").90
54.
On 13 January 2009, in his annual message to the National Assembly, President Chávez announced that:

"[T]his year the Venezuelan State has taken over the exploitation and control of the gold deposits of Las Cristinas at kilometer 88 in the State of Bolívar; one of the largest gold deposits on the American continent. Cristinas is estimated to have approximately 35.2 million ounces of gold, that is 1,094 metric tons of estimated reserves. Of this reserve, 24.5 million ounces, or 762 tons, are classified as proven.

In this way, the Venezuelan State controls 30,000 million dollars, which is the current estimated worth of the deposit. Currently, 30 thousand. The Las Cristinas concessions are organized into five parts: Cristina IV, Cristina V, Cristina VI, Cristina VII and Brisas del Cuyuni. They are under the control of socialism, for the development of economic growth for the national development.

[…]

In mining we have created this year (2008) the mixed company Venrús, with Russia, a Russian company and a Venezuelan company, a mixed company for the deposits of Las Cristinas […]".91

55.
On 26 February 2009, Crystallex sought information from the CVG regarding the status of the MOC,92 in response to which the CVG sent the following letter on 2 March 2009:

"Taking into account that the normative act that gave origin to the operations contract [MOC] has not been revoked or replaced, and that the contract is valid for 20 years and that Crystallex has been fulfilling the obligations assumed with the contract, we hereby inform you that the contract is fully valid and in the process of obtaining the required permits from the competent authorities for the development of the Project".93

56.
On 25 April 2010, according to the transcript of the President's weekly television address, "Aló Presidente", President Chávez stated, inter alia, that:

"If we are going to exploit gold, we will have to nationalize all of it, recuperate and put an end to concessions, which led to degeneration […]".94

57.
In response to a request from Crystallex dated 20 July 2010, the CVG informed Crystallex on 15 August 2010 that:

"[…] Given that the contract [MOC] has a duration of twenty (20) years and that the administrative act underlying the contract has not been replaced or repealed, it is clear that the same contract remains in full force and effect."95

58.
On 17 October 2010, the Agencia Venezolana de Noticias (State news agency) reported that President Chávez made the following statement during his visit in Belarus:

"Las Cristinas, this mine belongs to Venezuela and it has been handed over to transnational companies, I announce to the world that the revolutionary Government recuperated it, together with the Las Brisas mine. These mineral resources are for the Venezuelan people, not for transnationals".96

G. THE CVG'S RESCISSION OF THE MOC AND CRYSTALLEX'S INITIATION OF ARBITRATION IN FEBRUARY 2011

59.
On 3 February 2011, the CVG informed Crystallex that it was rescinding the MOC. The CVG's resolution stated that the CVG had decided to "unilaterally rescind for reasons of opportunity and convenience, the [MOC] […] due to the cessation of activities for more than one (1) year, in accordance with Clause Twenty-four [of the MOC]".97
60.
On 11 February 2011, Crystallex informed the CVG that it considered the CVG's resolution of 3 February 2011 to be null and that it was waiving its right to exercise a Petition for Reconsideration of the resolution, without prejudice to the rights it could assert in an arbitration proceeding under the Treaty.98
61.
On 16 February 2011, Crystallex filed a Request for Arbitration against Venezuela with the ICSID Secretariat.99
62.
On 25 February 2011, Crystallex wrote to the CVG's President Minister Khan in relation to the transfer of Las Cristinas to the Venezuelan authorities.100 On 15 March 2011, Crystallex sent a letter to Minister Khan informing him that Crystallex would maintain custody of the Las Cristinas camp only until 31 March 2011.101 On 31 March 2011, Crystallex wrote a further letter to the CVG in relation to the transfer of Las Cristinas to the Venezuelan authorities.102
63.
On 31 March 2011, the formal transfer took place before a Venezuelan Judge, who ordered that the material transfer take place within three business days.103 The material transfer of Las Cristinas took place on 4 and 5 April 2011.104

II. PROCEDURAL HISTORY

A. CONSTITUTION OF THE TRIBUNAL AND FIRST SESSION

64.
On 17 February 2011, ICSID received a request for arbitration from Crystallex against Venezuela (the "Request" or "RFA").
65.
On 9 March 2011, the Secretary-General of ICSID registered the Request in accordance with Articles 4 and 5 of the Arbitration Rules and notified the Parties of the registration. In the Notice of Registration, the Secretary-General invited the Parties to proceed to constitute an Arbitral Tribunal as soon as possible, in accordance with Rule 5(e) of the Arbitration Rules.
66.
By letters dated 10 and 13 June 2011, the Parties agreed that the Arbitral Tribunal would consist of three arbitrators, one to be appointed by each Party and the third arbitrator and President of the Tribunal to be appointed by agreement of the Parties. The appointment of the President of the Tribunal would be through a ballot method if the Parties did not reach an agreement within 14 days or agreed extension. If the ballot method did not render a result, the President of the Tribunal would be appointed pursuant to Article 10 of the Arbitration Rules.
67.
On 14 June 2011, following his appointment by the Claimant, Professor John Y. Gotanda, a national of the United States of America, accepted his appointment as arbitrator. On 15 June 2011, following his appointment by the Respondent, Justice Florentino Feliciano, a national of the Philippines, accepted his appointment as arbitrator. On 4 October 2011, following his appointment by the Parties, Dr. Laurent Lévy, a national of Brazil and Switzerland, accepted his appointment as presiding arbitrator.
68.
In accordance with Article 13 of the Arbitration Rules, on 5 October 2011, the Secretary-General notified the Parties that all three arbitrators had accepted their appointments and that the Tribunal was therefore deemed to have been constituted on that date. Ms. Ann Catherine Kettlewell, ICSID Legal Counsel, was designated to serve as Secretary of the Tribunal.
69.
Pursuant to Article 21(1) of the Arbitration Rules, on 25 October 2011 the Parties agreed to hold the First Session outside of the 60-day period. The Parties submitted a joint letter with their comments on the agenda of the First Session on 18 November 2011.
70.
The Tribunal held a First Session with the Parties on 1 December 2011 in Washington, D.C. In addition to the Members of the Tribunal and the Secretary of the Tribunal, present at the First Session were:

For the Claimant:

Mr. Nigel Blackaby Freshfields Bruckhaus Deringer

Mr. Alex Wilbraham Freshfields Bruckhaus Deringer

Mr. Patrick Childress Freshfields Bruckhaus Deringer

Mr. Robert Fung Crystallex International Corporation

Mr. Marc Oppenheimer Crystallex International Corporation

For the Respondent:

Mr. Ronald E.M. Goodman Foley Hoag LLP

Mr. Kenneth Figueroa Foley Hoag LLP

Ms. Martha Madero Foley Hoag LLP

71.
The Parties confirmed that the Members of the Tribunal had been validly appointed. It was agreed inter alia that the applicable Arbitration Rules would be those in effect from 10 April 2006, that the procedural languages would be English and Spanish, and that the place of arbitration would be Washington, D.C., U.S.A.
72.
The agreements of the Parties and decisions of the Tribunal were embodied in the Minutes of the First Session signed by the President and circulated to the Parties on 5 January 2012.
73.
As agreed at the first session, on 10 February 2012, the Claimant filed a Memorial on the Merits ("Memorial").

B. RESPONDENT'S REQUEST FOR BIFURCATION

74.
On 2 April 2012, the Respondent filed a request to address the objections to jurisdiction as a preliminary question.
75.
On 6 April 2012, the Tribunal established a date for the filing of the Claimant's reply and declared the proceeding on the merits suspended as of the date of the submission of the request for bifurcation and until a decision had been made by the Tribunal on the request.
76.
On 23 April 2012, the Claimant filed its reply, and on 26 April 2012 and 2 May 2012, the Parties exchanged further observations on the Respondent's request.
77.
On 23 May 2012, the Tribunal issued its Decision on Bifurcation, rejecting the Respondent's request to address the objections to jurisdiction as a preliminary question. As a result, the Tribunal dismissed all other prayers for relief and reserved the decision on costs for this Award. The Tribunal further lifted the suspension of the proceedings, proposed a new procedural calendar and confirmed the dates of the hearing on jurisdiction and the merits.

C. MERITS PHASE

78.
On 8 June 2012, the Parties proposed a revised procedural calendar, which was confirmed by the Tribunal on 14 June 2012.
79.
On 4 September 2012, the Claimant submitted a request for the Tribunal to decide on Venezuela's document production request, pursuant to section 14 of the Minutes of the First Session. On 7 September 2012, the Respondent submitted further comments on its reply to the Claimant's objections to Respondent's document production request. On 10 September 2012, the Claimant objected to Respondent's further comments as they were not agreed in the Minutes of the First Session. This exchange was further commented by the Respondent and the Claimant on the same date.
80.
On 17 September 2012, the Tribunal indicated that its decision would be based on the Parties' exchanges of 6, 16, 23 August and 4 September 2012, which reflected the process envisaged by the Minutes of the First Session. On 24 September 2012, the Tribunal issued Procedural Order No. 1 ruling on the Respondent's request for document production.
81.
On 9 October 2012, the Claimant informed the Tribunal that the Parties had reached an agreement to amend the procedural calendar. On 11 October 2012, the Tribunal confirmed the amendment to the procedural calendar agreed by the Parties.
82.
On 5 November 2012, the Respondent submitted a request for the Tribunal to decide on a request for document production from the Claimant, pursuant to section 14.1(d) of the Minutes of the First Session. On 12 November 2012, the Tribunal issued Procedural Order No. 2, deciding on the Claimant's request for document production.
83.
In accordance with the amended schedule agreed by the Parties and confirmed by the Tribunal, on 21 November 2012, the Respondent filed its Counter-Memorial on Jurisdiction and the Merits ("Counter-Memorial").
84.
On 26 November 2012, the Respondent informed the Tribunal of difficulties in producing certain documents in accordance with Procedural Order No. 2. Following comments from the Claimant, on 29 November 2012, the Tribunal ordered the Respondent to produce the documents on a rolling basis and to propose a reasonable time limit for that purpose. The Respondent explained that some documents contained confidentiality provisions that did not allow for their disclosure, and indicated that it would request authorization to disclose from the third party that had executed them. Following instructions from the Tribunal, on 3 December 2012, the Claimant requested a procedural order (i) guaranteeing the confidentiality of the documents and (ii) ordering Venezuela to complete the disclosure by 7 December 2012.
85.
After numerous exchanges, on 21 December 2012, the Parties submitted the final agreed text of the confidentiality terms. On 28 December 2012, the Tribunal issued Procedural Order No. 3 concerning confidentiality terms for the production of documents ordered in Procedural Order No. 2.
86.
On 23 January 2013, the Claimant requested the Tribunal to order the Respondent to disclose unredacted versions and other documents ordered under Procedural Order No. 2. On 29 January 2013, the Respondent indicated that it had continued efforts to obtain the consent for disclosure of the documents. On the basis of this information, on 1 February 2013 the Tribunal set a deadline for the Respondent to produce the documents ordered in Procedural Order No. 2. On 4 February 2013, the Respondent informed the Tribunal that all requested documents in Venezuela's possession, custody, or control had been produced and delivered to the Claimant, as stated in its communication of 31 January 2013.
87.
On 6 February 2013, the Claimant requested the Tribunal to order Venezuela to: (a) confirm whether the Development Consulting Agreement, the Engineering Procurement and Construction Contract, the Project Financing and any other documents responsive to the Tribunal's disclosure order relating to the Claimant's document production request were in the possession, custody or control of certain government-related third parties; and to (b) disclose any documents responsive to the Tribunal's disclosure order relating to the Claimant's document request. On 12 February 2013, the Respondent confirmed that it had complied with the Tribunal's instructions contained in Procedural Order No. 2.
88.
On 11 February 2013, the Respondent forwarded to the Tribunal the Parties' exchanges with respect to the Claimant's second document production request, and requested that the Tribunal rule upon the outstanding objections in accordance with Section 14.1 of the Minutes of the First Session. On 18 February 2013, the Tribunal issued Procedural Order No. 4 on the Claimant's second document production request.
89.
On 22 April 2013, the Parties agreed to an amendment to the procedural calendar, which was confirmed by the Tribunal on 24 April 2013.
90.
On 20 May 2013, the Parties informed the Tribunal of certain procedural agreements concerning the hearing. On 23 May 2013, the Tribunal confirmed the Parties' agreements and established the procedural calendar for the remainder of the proceeding.
91.
On 9 May 2013, the Claimant filed its Reply on jurisdiction and the merits ("Reply").
92.
On 10 September 2013, the Tribunal confirmed the pre-hearing conference call.
93.
On 13 September 2013, the Claimant informed the Tribunal that the Respondent had not produced certain documents ordered in Procedural Order No. 2 and requested the Tribunal to order the Respondent to produce a list of documents included in its letter together with any other documents responsive to Procedural Order No. 2. On 20 September 2013, the Respondent indicated that it had produced in good faith the documents initially requested by the Claimant. It also indicated that the specific documents referred to by the Claimant in its letter had also been produced and provided further reasons as to why other documents had not been produced.
94.
On 18 September 2013, the Respondent filed its Rejoinder on Jurisdiction and the Merits ("Rejoinder").
95.
On 27 September 2013, the Claimant submitted comments to Venezuela's response of 20 September 2013 and requested that the Tribunal order Venezuela to disclose immediately and, at any rate, no later than 4 October 2013 a number of documents in the possession, custody or control of Venezuela. On 30 September 2013, the Respondent requested the Tribunal to reject the Claimant's submission of 27 September 2013. The Respondent further argued that it had already complied with Procedural Order No. 2 and that the Claimant's list of documents constituted a new request to which the Respondent requested leave to reply to. On 1 October 2013, the Claimant confirmed that it had no further comments to its 27 September 2013 letter.
96.
On 30 September 2013, the Parties filed their requests for witnesses and experts to be made available for cross-examination at the hearing on jurisdiction and merits.
97.
On 1 October 2013, the President of the Tribunal inquired whether the Parties would agree to Dr. Michele Potestà's appointment as an Assistant to the Tribunal in this case. On 4 October 2013, both Parties agreed to Dr. Potestà's appointment. On 8 October 2013, the Tribunal confirmed the Parties' agreement and on 14 October 2013, the Centre circulated to the Parties Dr. Potestà's signed declaration.
98.
On 4 October 2013, the Tribunal issued Procedural Order No. 5 regarding the latest document production request formulated by the Claimant.

D. HEARING ON JURISDICTION AND THE MERITS

99.
On 7 October 2013, the Parties submitted a joint procedural proposal for the hearing and indicated that they would provide their respective views on the points of conflict separately on 14 October 2013.
100.
On 8 October 2013, the Tribunal confirmed the Parties' agreement and asked the Parties to indicate whether any additional items should be added to the agenda for the prehearing conference call.
101.
On 11 October 2013, the Parties submitted further explanations regarding the issues where they had been unable to reach an agreement.
102.
On 17 October 2013, the President of the Tribunal, the Assistant to the Tribunal, the Secretary of the Tribunal and the Parties held a pre-hearing conference call in English and Spanish. The Parties were represented by:

On behalf of the Claimant

Mr. Nigel Blackaby Freshfields Bruckhaus Deringer US LLP

Mr. Alexander Yanos Freshfields Bruckhaus Deringer US LLP

Mr. Alex Wilbraham Freshfields Bruckhaus Deringer US LLP

Ms. Caroline Richard Freshfields Bruckhaus Deringer US LLP

Mr. James Freda Freshfields Bruckhaus Deringer US LLP

On behalf of the Respondent

Mr. Ronald E.M. Goodman Foley Hoag LLP

Ms. Mélida Hodgson Foley Hoag LLP

Mr. Kenneth Figueroa Foley Hoag LLP

Ms. Alexandra Meise Bay Foley Hoag LLP

Ms. Analía González Foley Hoag LLP

103.
On 18 October 2013, the Claimant submitted new exhibits pursuant to section 3.3 of Procedural Order No. 5, which were admitted by the Tribunal into the record on 4 November 2013.
104.
On 23 October 2013, the Tribunal issued Procedural Order No. 6 concerning procedural matters relating to the hearing on jurisdiction and the merits.
105.
On 28 October 2013, the Parties submitted their respective lists of the witnesses they intended to examine regarding new issues not covered by their statements but directly related to the dispute and in which those witnesses had personal involvement pursuant to Section 6.3 of Procedural Order No. 6. The Respondent's communication also included a list of new exhibits (R-161 to R-182) pursuant to Section 7.3 of Procedural Order No. 6.
106.
On the same date, the Claimant submitted a list of additional exhibits and legal authorities responsive to the Respondent's Rejoinder pursuant to Section 7.3 of Procedural Order No. 6. The Claimant also presented a list of exhibits, originally submitted by the Respondent in excerpted form, for which the Claimant submitted additional excerpts or the full document.
107.
On 5 November 2013, the Respondent filed objections to the new exhibits submitted by the Claimant. On 29 October 2013, the Claimant objected to the Respondent's submission of new exhibits. On 30 October 2013, the Respondent indicated that Procedural Order No. 6 did not limit the presentation of new exhibits to one party and it would seek leave from the Tribunal to enter these exhibits into the record independently of Procedural Order No. 6. On 31 October 2013, the Respondent filed an amended list of exhibits. On 31 October 2013, the Claimant replied to the Respondent's arguments. On 4 November 2013, the Respondent filed its response. On 5 November 2013, the Tribunal issued its decision regarding the new exhibits.
108.
By letter of 5 November 2013, the Claimant requested the introduction of certain translations of documents as new exhibits. On 6 November 2013, the Respondent objected to the introduction of the translations. On the same date the Tribunal issued a decision on this issue.
109.
On 4 November 2013, the Respondent informed the Tribunal that Mr. José Salamat Khan Fernández was not going to be able to travel to Washington, D.C. for the hearing due to health concerns and as a result of his high level position at the Venezuelan government, which would not allow him to travel for long periods of time. The Respondent indicated that Mr. Khan Fernández would be made available for examination through videoconference. On 5 November 2013, the Tribunal granted leave to examine Mr. Khan Fernández by videoconference.
110.
A hearing on jurisdiction and the merits took place in Washington, D.C. in November 2013. Although the hearing had originally been scheduled to take place from 11 November 2013 to 22 November 2013, the proceeding was suspended on November 19, 2013 as a consence of the events described infra. In addition to the Members of the Tribunal, the Assistant to the Tribunal and the Secretary of the Tribunal, present at the hearing were:

On behalf of the Claimant:
Mr. Nigel Blackaby Freshfields Bruckhaus Deringer US LLP
Mr. Alex Yanos Freshfields Bruckhaus Deringer US LLP
Mr. Alex Wilbraham Freshfields Bruckhaus Deringer US LLP
Mr. Giorgio Mandelli Freshfields Bruckhaus Deringer US LLP
Ms. Caroline Richard Freshfields Bruckhaus Deringer US LLP
Mr. Jeffery Commission Freshfields Bruckhaus Deringer US LLP
Mr. Viren Mascarenhas Freshfields Bruckhaus Deringer US LLP
Mr. Giacomo Freda Freshfields Bruckhaus Deringer US LLP
Mr. Carlos Ramos-Mrosovsky Freshfields Bruckhaus Deringer US LLP
Mr. Patrick Childress Freshfields Bruckhaus Deringer US LLP
Mr. Ricardo Chirinos Freshfields Bruckhaus Deringer US LLP

Ms. Rebecca Everhardt Freshfields Bruckhaus Deringer US LLP
Ms. Guadalupe Lopez Freshfields Bruckhaus Deringer US LLP
Ms. Giulia Previtti Freshfields Bruckhaus Deringer US LLP
Ms. Karima Sauma Freshfields Bruckhaus Deringer US LLP
Mr. David Turner Freshfields Bruckhaus Deringer US LLP
Mr. Francisco Franco-Rodriguez Freshfields Bruckhaus Deringer US LLP
Mr. Henry Lancaster Freshfields Bruckhaus Deringer US LLP
Ms. Allison Gilchrist Freshfields Bruckhaus Deringer US LLP
Ms. Sarah Gans Freshfields Bruckhaus Deringer US LLP
Mr. Israel Guerrero Freshfields Bruckhaus Deringer US LLP
Mr. Iain McGrath Freshfields Bruckhaus Deringer US LLP
Mr. Luis Guerrero Wallis & Guerrero
Mr. Eduardo Travieso Travieso, Evans, Arria, Rengel & Paz
Mr. Ricardo Cottin Gómez, Cottin & Tejera-Paris
Mr. Gonzalo Tejera Gómez, Cottin & Tejera-Paris
Mr. Marc Oppenheimer Crystallex International Corporation
Mr. Robert Crombie Crystallex International Corporation
Mr. David Kay Crystallex International Corporation
Mr. Robin Shah Crystallex International Corporation
On behalf of the Respondent:
Dr. Ronald E.M. Goodman Foley Hoag LLP
Ms. Mélida Hodgson Foley Hoag LLP
Mr. Kenneth Figueroa Foley Hoag LLP
Dr. Alberto Wray Foley Hoag LLP
Mr. Thomas Ayres Foley Hoag LLP
Ms. Analía González Foley Hoag LLP
Ms. Alexandra Meise Bay Foley Hoag LLP
Ms. Erin Argueta Foley Hoag LLP
Mr. Diego Cadena Foley Hoag LLP
Ms. Madeleine Rodriguez Foley Hoag LLP

Mr. Pedro Ramirez Foley Hoag LLP
Ms. Elizabeth Glusman Foley Hoag LLP
Mr. Rodrigo Tranamil Foley Hoag LLP
Ms. Angélica Villagran Foley Hoag LLP
Ms. Carmen Roman Foley Hoag LLP
Ms. Jennipher Izurieta Foley Hoag LLP
Ms. Gabriela Guillen Foley Hoag LLP

111.
Due to the suspension of the hearing, which will be discussed in the following paragraphs, only the following persons were examined:

For the Claimant, the following expert and witnesses:

Witnesses
Mr. Robert Fung Crystallex International Corporation
Mr. Luis Felipe Cottin Fact witness
Mr. Sadek El-Alfy Fact witness
Mr. Sergio Alcalá Fact witness
Mr. Juan Claudio Palazzi Fact witness
Expert Prof. Henrique Meier Universidad Metropolitana
For the Respondent, the following witnesses:
Witnesses
Mr. José S. Khan Bolivarian Republic of Venezuela
Mr. Sergio Rodríguez Bolivarian Republic of Venezuela
Mr. Pedro Romero Bolivarian Republic of Venezuela
Mr. Manuel González Díaz Bolivarian Republic of Venezuela
Mr. Rodolfo Roa Bolivarian Republic of Venezuela
Ms. Charly Rodríguez Bolivarian Republic of Venezuela
Mr. Ramón Olivares Bolivarian Republic of Venezuela
Ms. Laura Paredes Bolivarian Republic of Venezuela

112.
Transcripts of the hearing were distributed to the Parties. Audio recordings of the hearing in English and Spanish were also sent to the Parties.

E. RECONSTITUTION OF THE TRIBUNAL AND CONTINUATION OF THE HEARING ON JURISDICTION AND THE MERITS

113.
On 18 November 2013, the Respondent filed before the Secretary-General a proposal for the disqualification of Justice Florentino Feliciano, pursuant to Articles 14 and 15 of the Arbitration Rules. Since the proposal was filed during the hearing, the Respondent requested that the hearing be immediately suspended pursuant to Article 15(7).
114.
By letter dated 19 November 2013, the Secretary-General declared the proceeding suspended until a decision had been taken with respect to the proposal for the disqualification of Justice Feliciano. On the same date, the two unchallenged arbitrators established the calendar of submissions regarding the challenge.
115.
On 5 December 2013, Justice Feliciano submitted his resignation to the Secretary-General. His resignation was transmitted to the Parties and the other two Members of the Tribunal on 9 December 2013. Pursuant to Article 14(3) of the Arbitration Rules, the reasons for Justice Feliciano's resignation were considered by the Tribunal, which consented thereto on 11 December 2013. The proceeding remained suspended pursuant to Article 16(2) of the Arbitration Rules.
116.
On 15 December 2013, the Respondent appointed Professor Laurence Boisson de Chazournes, a national of France, as arbitrator pursuant to Articles 14(3) and 17(1) of the Arbitration Rules.
117.
On 19 December 2013, Professor Boisson de Chazournes accepted her appointment. The Tribunal was reconstitutued and the proceeding resumed in accordance with Article 18 of the Arbitration Rules.
118.
On 23 December 2013, the Tribunal informed the Parties that, given the short time between the appointment of Prof. Boisson de Chazournes and the date for the envisaged continuation of the hearing, Prof. Boisson de Chazournes envisaged the possibility to retain an assistant for the purpose of the preparation of the hearing. The Claimant and the Respondent consented to the appointment of such assistant on 24 December and 27 December 2013 respectively. It subsequently turned out that such support was eventually not needed.
119.
On 8 January 2014, the Tribunal confirmed that the procedural directions issued in relation to the November 2013 hearing would remain applicable to the continuation of the hearing, subject to some amendments. On 17 January 2014, the Parties submitted their comments to the amendments. On 22 January 2014, having considered the Parties' comments, the Tribunal issued the final amended procedural directions, which were included as an amendment to Annex A to Procedural Order No. 6.
120.
The continuation of the hearing on jurisdiction and the merits took place in Washington, D.C. from 16 February to 19 February 2014. In addition to the Members of the Tribunal, the Assistant to the Tribunal and the Secretary of the Tribunal, present at the hearing were:

On behalf of the Claimant:
Mr. Nigel Blackaby Freshfields Bruckhaus Deringer US LLP
Mr. Alex Yanos Freshfields Bruckhaus Deringer US LLP
Mr. Alex Wilbraham Freshfields Bruckhaus Deringer US LLP
Ms. Caroline Richard Freshfields Bruckhaus Deringer US LLP
Mr. Jeffrey Commission Freshfields Bruckhaus Deringer US LLP
Mr. Viren Mascarenhas Freshfields Bruckhaus Deringer US LLP
Mr. Giacomo Freda Freshfields Bruckhaus Deringer US LLP
Mr. Carlos Ramos-Mrosovsky Freshfields Bruckhaus Deringer US LLP
Mr. Ricardo Chirinos Freshfields Bruckhaus Deringer US LLP
Ms. Guadalupe Lopez Freshfields Bruckhaus Deringer US LLP
Mr. David Turner Freshfields Bruckhaus Deringer US LLP
Ms. Karima Sauma Freshfields Bruckhaus Deringer US LLP
Ms. Giulia Previti Freshfields Bruckhaus Deringer US LLP
Mr. Francisco Franco Freshfields Bruckhaus Deringer US LLP
Mr. Henry Lancaster Freshfields Bruckhaus Deringer US LLP
Mr. Jaime Aranda Freshfields Bruckhaus Deringer US LLP
Ms. Allison Gilchrist Freshfields Bruckhaus Deringer US LLP
Ms. Sarah Gans Freshfields Bruckhaus Deringer US LLP
Mr. Israel Guerrero Freshfields Bruckhaus Deringer US LLP
Mr. Iain McGrath Freshfields Bruckhaus Deringer US LLP
Mr. Ricardo Cottin Gómez, Cottin & Tejera-Paris
Mr. Robert Fung Crystallex International Corporation (previous fact witness)
Mr. Marc Oppenheimer Crystallex International Corporation
Mr. Robert Crombie Crystallex International Corporation

Mr. Robin Shah Crystallex International Corporation
Mr. David Kay Crystallex International Corporation
Mr. Sadek El-Alfy Crystallex International Corporation (previous fact witness)
On behalf of the Respondent:
Dr. Ronald E.M. Goodman Foley Hoag LLP
Ms. Mélida Hodgson Foley Hoag LLP
Mr. Kenneth Figueroa Foley Hoag LLP
Dr. Alberto Wray Foley Hoag LLP
Mr. Thomas Ayres Foley Hoag LLP
Ms. Alexandra Meise Bay Foley Hoag LLP
Ms. Analía González Foley Hoag LLP
Ms. Erin Argueta Foley Hoag LLP
Mr. Diego Cadena Foley Hoag LLP
Ms. Madeleine Rodriguez Foley Hoag LLP
Mr. Pedro Ramirez Foley Hoag LLP
Ms. Elizabeth Glusman Foley Hoag LLP
Ms. Angélica Villagran Foley Hoag LLP
Ms. Carmen Roman Foley Hoag LLP
Ms. Jennipher Izurieta Foley Hoag LLP
Mr. Peter Hakim Foley Hoag LLP

121.
The following experts were examined:

For the Claimant:

Prof. José Antonio Muci - Muci-Abraham & Asociados

Ms. Sharon Maharg - Environ International Corp

Dr. Robert Langstroth - Environ International Corp

Mr. Reed Huppman - Environ International Corp

Dr. Richard Jolk - Mineral Property Development, Inc

Dr. David Snow David T. Snow, Ph.D. & Associates
Dr. Ronald Cohen Ronald R.H. Cohen, PhD, Environmental Consulting
Mr. Trevor Ellis Ellis International
Mr. Manuel Abdala Compass Lexecon
Mr. Pablo Spiller Compass Lexecon
For the Respondent:
Dr. Henrique Iribarren Monteverde Socorro & Iribarren
Dr. Isabel De los Rios Expert witness
Prof. Kadri Dagdelen OptiTech Engineering Solutions, Inc.
Mr. Luke Danielson OptiTech Engineering Solutions, Inc.
Dr. Gültekin Savci OptiTech Engineering Solutions, Inc.
Prof. Carron Meaney OptiTech Engineering Solutions, Inc.
Mr. Thomas H. Pearson Continental Partners LLC
Mr. Timothy H. Hart Credibility International

122.
Transcripts of the hearing were distributed to the Parties. Audio recordings of the hearing in English and Spanish were also sent to the Parties.
123.
On 19 February 2014, the Respondent sought leave to amend footnote 239 on page 79 of the Environmental and Social Expert Report of OptiTech Engineering Solutions Inc. of November 21, 2012 (First ER OptiTech) which was an issue that had been raised during the examination of Mr. Luke Danielson. On 21 February 2014, pursuant to the instructions provided by the Tribunal at the hearing, the Claimant submitted its observations to the amendment of the First ER OptiTech. On 27 February 2014, the Respondent replied to the Claimant's observations. On 28 February 2014, the Tribunal confirmed that the First ER OptiTech had been amended to reflect the correct citations as set forth in the Respondent's letter of 19 February 2014, and provided another deadline to the Parties to comment. The Parties did not further comment on this issue.
124.
On 4 March 2014, the Secretary of the Tribunal transmitted a set of questions from the Tribunal for the Parties to address in their post-hearing submissions pursuant to the instructions provided at the hearing. The questions were not meant to be exhaustive but rather to point to some areas that required additional clarification from the Parties. The questions were as follows:

1) Assuming that the Tribunal would not have jurisdiction over the claims arising directly from the rescission of the MOC (under either or both jurisdictional objections put forward by the Respondent), what would be the consequences, if any, on the prayers for relief, on the awards, on the valuation date, and especially on the amounts to be awarded?

2) The Tribunal understands that the Claimant has withdrawn its claim for restitution (Hearing Transcript, 11 November 2013, 205:14-18; 255:1518). If this understanding is erroneous, the Tribunal invites the Claimant to clarify its position.

3) If the Tribunal were to conclude that Minister Khan did not have the authority to rescind the MOC, would the consequences be that the rescission is not valid? Would that mean that it produces no effects? If yes (to either of the two preceding questions in this paragraph), what would be the consequences of that invalid rescission under Venezuelan law, if relevant, and under international law?

4) Which were the rights of the Claimant (exploration, exploitation, occupation, development etc.) under the MOC at the time of the permit denial in 2008, and until the rescission of the MOC in 2011?

5) At what time(s) did the Claimant's alleged legitimate expectations arise?

6) Assuming that the Tribunal were to find liability under one of the Treaty's standards of treatment (expropriation, fair and equitable treatment, etc.), would it then have to analyze whether the other Treaty standards have also been breached? If yes, why?

7) How should the relationship between the fair and equitable treatment and the full protection and security standards be understood in the context of Article 2.2 of the Treaty?

8) What is the standard of compensation applicable in this case for Treaty breaches other than expropriation? What would result (in figures) from the application of that standard?

9) Assuming the Tribunal were to find liability under one or more of the Treaty's standards of treatment, what would the Claimant's damages be under the various approaches set forth by Claimant, other than the stock market approach, if:

(i) The date of valuation is (a) April 13, 2008 or (b) February 3, 2011;

(ii) The price of gold is (a) $629, or $650, or $925, in the case of a valuation date of April 13, 2008, or (b) $1,039, or $1,100, or $1,328, in the case of a valuation date of February 3, 2011;

(iii) The duration is 20 years (assume no renewals);

(iv) The extraction rate is 20,000 tpd moving to 40,000 tpd in year 3; and

(iv) The implied nominal discount rate is (a) 10.41%, or (b) 12.71%, or (c) 15%, or (d) 17%, or 22%?

10) Assuming that the Tribunal were to find liability under one or more of the Treaty's standards of treatment and were to use a stock market approach, would it have all the needed figures (metrics, relevant stock prices)? If so, what would the Claimant's damage be applying a stock market approach, assuming: (a) a stock price from June 14, 2007, (b) a control premium of 20% or, in the alternative, no control premium, (c) applying the permitting bump (as set forth by Claimant) or, in the alternative, excluding a permitting bump, (d) applying the rate of growth in benchmark industry indices as set forth by Claimant, and (e) a valuation date of April 13, 2008, or in the alternative, February 3, 2011.

11) Assuming that the Tribunal were to find liability under one or more of the Treaty's standards of treatment and were to use a cost approach, could the Parties provide the actual amounts spent and evaluate their contribution to value?

12) Assuming the Tribunal were to find liability under one or more of the Treaty's standards of treatment and award damages, please explain why or why not the $37.4 million received from mitigation efforts should be deducted from any damages owed to Claimant?

125.
On 18 March 2014, the Claimant raised certain difficulties regarding Tribunal's question 9. On 4 April 2014, the Respondent filed its comments and noted that it needed to address with new evidence or analysis some of the issues contained in the Claimant's letter of 18 March 2014. Therefore, the Respondent reserved its rights to provide supplemental comments to the Claimant's responses to the extent that such answers implied a new damages analysis or new evidence. On 7 April 2014, the Tribunal instructed the Parties to first seek leave from the Tribunal before making submissions on the referred issue, whether before or after the post-hearing briefs ("PHB"). In compliance with the Tribunal's direction, on 8 April 2014, the Claimant indicated that it also reserved its rights to comment on (a) the valuation date; and (b) the evidence on the record with respect to the value of the Claimant's interest in Las Cristinas depending on the valuation date used.
126.
On 28 March 2014, the Parties submitted the final agreed corrected transcripts of the hearing, in accordance with section 17 of Annex A to Procedural Order No. 6 (as amended).
127.
On 2 May 2014, the Parties informed the Tribunal that they had agreed to an extension to file the post-hearing briefs. On 5 May 2014, the Tribunal confirmed the extension agreed by the Parties.
128.
The Parties filed simultaneous post-hearing briefs on 12 May 2014.
129.
On 10 June 2014, the Respondent requested the Tribunal to strike from the record alleged new evidence, arguments and valuations presented in the Claimant's PostHearing Brief, to which the Claimant replied on 11 June 2014. On 13 June 2014, the Tribunal invited the Respondent to indicate the precise paragraphs or sentences from the Claimant's Post-Hearing Brief that it wished to have stricken from the record and the Claimant to subsequently indicate which of the identified section it objected to. The Parties submitted the requested information in their respective letters of 20 and 27 June 2014. On 30 June 2014, the Respondent submitted further comments on this matter.

F. FURTHER QUANTUM INFORMATION REQUESTED BY THE TRIBUNAL AND HEARING ON QUANTUM

130.
On 25 July 2014, the Tribunal invited the Parties to file one further round of submissions with related evidence and expert reports, if needed, subject to certain limitations. In doing so, the Tribunal specified that it did not wish to receive additional evidence that was not strictly related to the questions raised in the Tribunal's letter of 25 July 2014. In particular, the Tribunal invited the Claimant to provide a submission addressing the following questions with related evidence and expert reports, to be followed by the Respondent's submission with related evidence and expert reports, if needed:

1. To supply the necessary data and the calculations in relation to the P/NAV method, assuming:

(i) The date of valuation is 13 April 2008;

(ii) The price of gold is (a) $629, or (b) $650, or (c) $925;

(iii) The duration is (a) 20 years or (b) 40 years;

(iv) The extraction rate is 20,000 tpd moving to 40,000 tpd in year 3; and

(v) The implied nominal discount rate is (a) 10.41%, or (b) 12.71%, or (c) 15%, or (d) 17%, or (e) 22%.

2. To supply the necessary data and the calculations in relation to the market multiples method, assuming:

(i) The date of valuation is (a) 13 April 2008 or (b) 3 February 2011;

(ii) A control premium of 20% or, in the alternative, no control premium;

(iii) The duration is (a) 20 years or (b) 40 years;

(iv) The extraction rate is 20,000 tpd moving to 40,000 tpd in year 3 (assume no "unconstrained" scenario).

3. To supply the necessary data and the calculations in relation to the stock market approach:

(i) Assuming the date of valuation is (a) 13 April 2008 or (b) 3 February 2011;

(ii) Assuming a stock price from 14 June 2007;

(iii) Assuming a control premium of 20% or, in the alternative, no control premium;

(iv) Applying the permitting bump (as set forth by the Claimant) or, in the alternative, excluding a permitting bump;

(v) Using the Market Vectors Junior Gold Mining Index (Exh. CLEX-96) to project the growth of Crystallex's share price to (a) 13 April 2008 or (b) 3 February 2011.

4. To update and provide any further supporting document in relation to the cost approach, in particular any supporting evidence of net costs (i.e., costs from which the damage claim would flow) incurred until 2014.

5. To correct its request for relief set forth in paragraph 749 of its posthearing brief. In order to avoid any misunderstanding, the Tribunal believes that there is a need to correct some typographical or clerical errors and is directing the Claimant only to correct such typographical or clerical errors, if indeed there are any.

131.
On 14 August 2014, the Respondent raised concerns regarding the Tribunal's 25 July 2014 request for further quantum information and requested that the Tribunal withdraw its request and allow it to comment on the Claimant's submitted new calculation on the cost approach. On 15 August 2014, the Tribunal invited the Claimant to comment on Respondent's 14 August 2014 communication, which the Claimant did on the same date and also requested an extension to file its response to the Tribunal's 25 July 2014 request for further quantum information. On 17 August 2014, the Respondent reiterated its request to the Tribunal. On 18 August 2014, the Tribunal decided to reaffirm its request from 25 July 2014 and extended the deadlines for the Parties to submit their responses.
132.
On 1 September 2014, the Respondent requested that the Tribunal hold a hearing after the submissions of the Parties in response to the Tribunal's 25 July 2014 request for further quantum information. On 4 September 2014, the Claimant requested an extension to submit its comments. On 5 September 2014, the Tribunal granted Claimant's request and indicated the dates in which the Tribunal would be available for a possible hearing, without prejudice to its decision regarding the Respondent's request. On 7 September 2014, the Claimant submitted its comments. On 8 September 2014, the Tribunal decided (a) to hold a short hearing limited to the examination of experts on quantum; and (b) that no further submissions were required beyond the ones contemplated.
133.
On 12 September 2014, the Claimant submitted its Supplemental Submission on Quantum and Compass Lexecon's Responses to the Tribunal's Questions dated 25 July 2014. On 15 September 2014, the Claimant submitted a revised version of Compass Lexecon's Responses to the Tribunal's Questions dated 25 July 2014.
134.
On 18 September 2014, Professor Boisson de Chazournes informed the Parties that she had acquired Swiss nationality.
135.
On 31 October 2014, the Respondent filed its Supplemental Submission on Quantum and the Third Expert Report of Timothy H. Hart of Credibility International.
136.
On 9 October 2014, the Claimant submitted the award in the case Gold Reserve Inc. v. Bolivarian Republic of Venezuela (ICSID Case No. ARB(AF)/09/1) as a new legal authority. Further to this submission, the Claimant also requested leave from the Tribunal for both Parties to submit a brief analysis of key elements in the aforementioned award. On 10 October 2014, the Tribunal invited the Respondent to submit its comments to the Claimant's request by 14 October 2014. The Respondent requested an extension to the deadline, which was granted by the Tribunal.
137.
On 15 October 2014, the Respondent submitted its comments to the specific elements raised by the Claimant in its 9 October 2014 letter and also submitted the award in the case Mobil Corporation, Venezuela Holdings, B.V., Mobil Cerro Negro Holding, Ltd., Mobil Venezolana de Petróleos Holdings, Inc., Mobil Cerro Negro, Ltd., and Mobil Venezolana de Petróleos, Inc. v. Bolivarian Republic of Venezuela (ICSID Case No. ARB/07/27) as a new legal authority in this case.
138.
On 16 October 2014, the Claimant replied to the Respondent's comments and reiterated its request for an exchange of brief submissions. On the same date, the Respondent addressed the Claimant's request for brief submissions and suggested that such submissions be filed after the hearing scheduled for November 2014.
139.
On 17 October 2014, the Tribunal invited the Parties to submit brief comments on the two new legal authorities and reminded the Parties that the scheduled hearing was to be solely for the limited purpose of examining the Parties' experts on quantum. On the same date, the Respondent requested an extension of the deadline to submit its brief comments.
140.
On 20 November 2014, the Tribunal indicated that it did not see the need to extend the deadline but that it could reconsider the Respondent's request once it had received the brief comments from the Claimant.
141.
On 31 October 2014, the Claimant submitted its comments on the new legal authorities.
142.
On 6 November 2014, the Respondent reiterated its request for an extension and noted that the Claimant was making new arguments with respect to the new legal authorities. On 7 November 2014, the Claimant objected to the Respondent's characterization of its comments but did not object to the extension.
143.
On 10 November 2014, the Respondent filed its brief comments on the new legal authorities pursuant to the Tribunal's granted extension.
144.
On 23 September 2014, the Parties submitted agreed procedural rules for the hearing on quantum.
145.
On 25 September 2014, the Tribunal issued the final procedural rules for the hearing.
146.
On 7 November 2014, the Tribunal issued revised final procedural rules for the hearing.
147.
On 20 November 2014, the Claimant requested the Tribunal to rule on its request for leave to submit additional factual exhibits into the record in accordance with paragraph 16 of the updated procedural rules. On the same date, the Respondent objected to the Claimant's new documents. The Claimant's request was rejected by the Tribunal on the same day.
148.
On 22 November 2014, the hearing on further information on quantum took place in Paris. In addition to the Members of the Tribunal, the Assistant to the Tribunal and the Secretary of the Tribunal, present at the hearing were:

On behalf of the Claimant:

Mr. Nigel Blackaby Freshfields Bruckhaus Deringer US LLP

Mr. Alexander Yanos Mr. Alex Wilbraham Hughes Hubbard & Reed LLP Freshfields Bruckhaus Deringer US LLP
Mr. Carlos Ramos-Mrosovsky Freshfields Bruckhaus Deringer US LLP
Ms. Giulia Previti Freshfields Bruckhaus Deringer US LLP
Mr. Israel Guerrero Freshfields Bruckhaus Deringer US LLP
Mr. Jaime Aranda Freshfields Bruckhaus Deringer US LLP
Ms. Mélanie Merouze Freshfields Bruckhaus Deringer US LLP
Mr. Ricardo Cottin Gómez, Cottin & Tejera-Paris
Mr. Robert Fung Crystallex International Corporation
Mr. Marc Oppenheimer Crystallex International Corporation
Mr. Robert Crombie Crystallex International Corporation
Mr. David Kay Crystallex International Corporation
On behalf of the Respondent:
Ms. Mélida N. Hodgson Foley Hoag LLP
Mr. Kenneth J. Figueroa Foley Hoag LLP
Mr. Thomas R. Ayres Foley Hoag LLP
Ms. Angélica Villagrán Foley Hoag LLP
Mr. Pedro Ramirez Foley Hoag LLP

149.
The following experts were examined:

For the Claimant:

Mr. Manuel Abdala Compass Lexecon

Mr. Pablo Spiller Compass Lexecon

For the Respondent:

Mr. Timothy Hart Credibility International

150.
On 26 November 2014, the Secretariat dispatched an electronic copy of the audio and transcripts of the hearing in English and Spanish.
151.
On 15 December 2014, the Parties sent the final agreed corrected transcript of the hearing on quantum.
152.
On 21 January 2015, the Respondent informed the Secretariat of changes to the contact list in the arbitration. On 22 January 2015, the Secretariat inquired as to the contact person to whom all communications should be addressed within the Attorney General's office. On that same date, the Respondent informed the Secretariat that all communications should be addressed to Dr. Reinaldo Enrique Muñoz Pedroza, Viceprocurador General de la República.
153.
On 23 January 2015, the Secretariat informed the Parties that, following the decision of Ms. Ann Catherine Kettlewell to leave her position at ICSID, the Secretary-General had appointed Ms. Alicia Martín Blanco, ICSID Legal Counsel, as Secretary of the Tribunal in this case.
154.
The Parties filed their submissions on costs on 23 January 2015.
155.
On 26 June 2015, the President of the Tribunal disclosed to the Parties his recent appointment as President in two separate arbitrations in which Freshfields acted as counsel for one of the parties, one of which arbitrations involved three state-owned Venezuelan entities as respondents. The President indicated that he did not consider that these facts affected his independence and impartiality and noted that the disclosure was made for the sake of transparency only.
156.
On 29 June 2015, the Respondent asked the President of the Tribunal to identify certain specifics about one of the arbitrations to which he had referred in his communication of 26 June 2015. On 1 July 2015, the President of the Tribunal provided to the Parties the information requested by the Respondent in its communication of 29 June 2015.
157.
The proceeding was closed on December 24, 2015.

III. PRELIMINARY MATTER: VENEZUELA'S PROCEDURAL OBJECTIONS

158.
As a preliminary matter, the Tribunal addresses certain procedural and due process objections made by the Respondent during the proceedings. The Tribunal finds it important to put those objections within the context in which they were made and to underscore the subsequent developments that followed those objections.
159.
On 2 June 2014, the Respondent sought leave from the Tribunal to provide comments to the Claimant's PHB and its Annex I, which according to the Respondent contained "new and misleading arguments largely based on documents not found in the evidentiary record". Further letters on this issue were received on 9 and 11 June 2014 from the Claimant and on 10 June 2014 from the Respondent respectively.
160.
On 13 June 2014, the Tribunal took note that in its 10 June 2014 letter, Venezuela had requested the Tribunal to strike from the record the allegedly new evidence, arguments and valuations presented in the Claimant's PHB. The Tribunal invited the Respondent to indicate by 20 June 2014 the precise paragraphs or sentences from the Claimant's PHB that should be struck from the record, and the Claimant to indicate by 27 June 2014 which of the paragraphs or sentences indicated by the Respondent it objected being struck from the record. The Tribunal added that it would "take a decision subsequently, possibly as late as in its Final Award".
161.
Pursuant to the Tribunal's directions, on 20 June 2014, the Respondent specified its request to strike certain paragraphs from the Claimant's PHB from the record, to which the Claimant replied in its letter of 27 June 2014.
162.
A further letter from the Respondent was received on 30 June 2014.
163.
As is recalled in the procedural history above,105 the Tribunal asked further questions to the Parties on 25 July 2014, which in turn triggered a further round of written supplementary quantum submissions (and expert reports) as well as one full day of Hearing, the latter at the request of the Respondent.
164.
At the end of the Quantum Hearing, the President of the Tribunal asked the following question:

"PRESIDENT LÉVY: We had some objections from [the Respondent's] side with respect to due process. Do those objections still stand, or not now, after this Hearing? Please, feel free to say that you don't want to answer now. But if you don't answer now, I would like for you to confirm in writing rather expeditiously. I don't need the answer now, but I need it, let's say, expeditiously. So, if you prefer.

MS. HODGSON: Thank you, Mr. President. We will confer, and we will get back to you as soon as possible.

PRESIDENT LÉVY: Very well."106

165.
The Tribunal received no further comment in this respect from the Respondent after the Quantum Hearing.
166.
As a general matter, the Tribunal notes that many of the Respondent's objections concern answers provided by the Claimant in response to certain specific Tribunal questions sent to the Parties on 4 March 2014. The Respondent did not object to the Tribunal's proposal at the hearing to list questions for the Parties to answer in a single round of post-hearing submissions to be filed simultaneously.107 Furthermore, the Respondent did not object when the Tribunal forwarded its questions to the Parties on 4 March 2014. It is obvious that the possibility existed that somewhat new arguments or analysis could be made by either Party in response to such questions: after all, if the questions could prompt only identical arguments or analysis as those already contained in previous pleadings, there would have been no need for the Tribunal to ask those questions in the first place.
167.
More importantly, the Tribunal notes that, after Venezuela first raised its objections on 2 June 2014 (and then specified them in its letters of 10, 20 and 30 June 2014), the Parties had further opportunities to present their views, both in writing through their supplemental quantum submissions of 12 September and 31 October 2014 respectively, and orally at the Quantum Hearing of 22 November 2014. Finally, when asked by the Tribunal at the end of the Quantum Hearing whether the Respondent would maintain all or some of the objections recalled above, the Respondent advised that it would get back to the Tribunal "as soon as possible". As already noted, the Respondent did not provide any further comments or complaints, which the Tribunal understands to mean that the Respondent effectively did not wish to pursue those objections further. The Tribunal thus trusts that all objections have been satisfactorily resolved or addressed in the subsequent phase of the arbitration, or have been abandoned for other reasons even if they might have been warranted at the time they were first made.
168.
Out of abundance of caution and for the sole purpose of the avoidance of doubt, the Tribunal nonetheless addresses each of Venezuela's objections in the following paragraphs.

A. OBJECTIONS REGARDING CLAIMANT'S PHB

169.
The first two objections raised by Venezuela concern certain points made by the Claimant in response to Question 1 of the Tribunal's 4 March 2014 Questions.
170.
Venezuela argues that the Claimant consistently framed its claim positing that notice was given regarding the rescission in the November 2008 Notice of Dispute, while in its answer to the Tribunal's questions, the Claimant for the first time sought to present the transfer of Las Cristinas, pursuant to the rescission, as an event independent of the rescission and constituting a takeover.108 Venezuela further argues that the Claimant has not previously framed its jurisdiction rescission claim as one based on the "rescission" "and/or" "takeover".109
171.
Question 1 of the Tribunal's 4 March 2014 Questions concerned a hypothetical about the possible consequences that would follow in the event that the Tribunal were to find that it had no jurisdiction over claims arising directly from the rescission of the MOC.110 Because of the decision ultimately taken by the Tribunal that indeed it has jurisdiction over the entire dispute, the comments made by the Parties in response to Question 1 are of no relevance for any matter decided by the Tribunal in this Award, and Venezuela cannot have been prejudiced by any of such allegedly new arguments. The Tribunal can thus dispense with expressly resolving this objection.

B. OBJECTION REGARDING CLAIMANT'S PHB

172.
The Respondent's next objection concerns an argument made by the Claimant that the relative market multiple method is unaffected by a 20-year contract life.111
173.
The Tribunal notes that the Parties had ample opportunity to address the methodological bases of the market multiples analysis not only in their PHBs, but also subsequently in their supplemental quantum submissions and at the Quantum Hearing. The Respondent's objection that Venezuela has not had an opportunity to respond to those arguments, whether valid or not when it was made, is thus rejected.

C. OBJECTION REGARDING CLAIMANT'S PHB

174.
The Respondent further objects to the Claimant's introduction of the so-called Goldcorp implied valuation for 13 April 2008. According to the Respondent, such implied valuation is new and was not requested by the Tribunal. Venezuela thus had no opportunity to respond to it.112 Accordingly, the Respondent requests that those portions relating to the Goldcorp implied valuation be struck from the record.
175.
The Claimant argues that the so-called "Goldcorp transaction" confirms the results it has arrived at through its valuation methods.113
176.
The Claimant contends that, in February 2006, Goldcorp acquired 5% of Crystallex's shares, as well as the right to purchase an additional 4.9% at US$4.25 per share, for an overall 9.9% interest.114 According to the Claimant, because between February 2006 and February 2011 (Claimant's proposed date of valuation), gold prices more than doubled, and the value of gold stock indices increased by 62%, the US$982 million valuation (control premium excluded) at which Goldcorp was willing to purchase shares in 2006 would have become a valuation of at least US$1.97 billion as of 3 February 2011 (control premium excluded).115 Applying a "market standard" control premium of 20%, a but-for value of 100% of Crystallex projected from the Goldcorp investment as of the valuation date would yield a figure of US$2.37 billion.116 According to the Claimant, these extrapolations from a major real-world investment in Crystallex's stock prior to Venezuela's unlawful measures yield values that should provide the tribunal with further confirmation that Crystallex's assessment of the Fair Market Value of its right at Las Cristinas is reasonable and consistent with market expectations.117
177.
With regard to Venezuela's objection that the Goldcorp "implied valuation" is new, the Claimant submits that such valuation is simply an arithmetical relationship between data that have long been in the record. Furthermore, it is not a valuation per se, but represents an actual arm's-length transaction that should serve as a reference point confirming the reasonableness of the results obtained by its experts.118
178.
The Tribunal agrees with the Respondent that the Goldcorp implied valuation is new and that it was not requested by the Tribunal in any of its questions. The Tribunal has not resorted to such "valuation" in reaching its conclusions on the damages to be awarded to the Claimant. The Respondent's objection in this respect is thus granted.

D. OBJECTION REGARDING THE COST APPROACH VALUATION

179.
The Respondent points to the Claimant's PHB, para. 105, to the Claimant's PHB Annex I, paras 11-1 to 11-5 (including tables and footnotes), and 11.6 (1st sentence), and argues that the cost approach valuation is based on evidence not in the record and includes classes of costs never before presented or explained by the Claimant. Venezuela contends that it was never given an opportunity to respond to such new valuation in order to demonstrate the various methodological and conceptual flaws it contains.119
180.
The Tribunal notes that the Parties subsequently had ample opportunity to address the cost approach figures put forward by the Claimant in response to the Tribunal's questions both in their supplemental quantum submissions and at the Quantum Hearing. The Respondent's objection that Venezuela has not had an opportunity to respond to those arguments is thus rejected. The Tribunal has in any circumstances come to the conclusion that the cost approach cannot be used as a valuation method in this arbitration for the reasons set out further below. It has referred to it only for illustrative purposes, i.e. ex abundanti cautela, to confirm the reasonableness of its conclusions reached by reference to other valuation methods.

E. OBJECTION REGARDING CLAIMANT'S PHB

181.
Finally, the Respondent argues that the Claimant's argument made in its PHB at para. 476 that the expropriation began in June 2007 is new, as the Claimant had previously argued that the alleged "creeping expropriation" began in April 2008.120
182.
The Claimant rebuts that Venezuela misrepresents its arguments, as it has never advanced any argument that there was a Treaty breach or creeping expropriation prior to the Permit Denial Letter of April 2008.121
183.
To the extent there could be a possible uncertainty as to the Claimant's argument with respect to the time when the alleged "creeping expropriation" began, the Tribunal has taken note of the Claimant's clarification in this respect. Given this clarification, the Tribunal believes that the record has been put straight, and that there cannot be a new argument made by the Claimant to which the Respondent might have needed to respond.

IV. THE PARTIES' PRAYERS FOR RELIEF

184.
In this arbitration, the Claimant has made the following prayer for relief (as is stated in its latest submission, i.e. its Supplemental Quantum Submission):

"[...] Crystallex respectfully requests that the Tribunal:

DECLARE that:

(i) Venezuela has breached Article VII(l) of the Treaty by expropriating the Claimant's investments in Venezuela; and

(ii) Venezuela has breached Article II(2) of the Treaty by failing to accord the Claimant's investments in Venezuela fair and equitable treatment, and full protection and security;

ORDER that:

(iii) Venezuela pay the Claimant the sum of USD3,160,000.000 for its breaches of the Treaty or such other amount as the Tribunal determines is a consequence of (i) and (ii);

(iv) Venezuela pay pre-award interest in the sum of USD1,034,174.685, calculated from the Valuation Date to 12 September 2014 or such other amount as the Tribunal considers will ensure full reparation and thereafter at a commercially reasonable rate of 8% per annum until the date of the Tribunal's Award, compounded semi-annually, or at such other rate and compounding period as the Tribunal determines will ensure full reparation;

(v) Venezuela pay post-award interest on (iii) and (iv) above at a commercially reasonable rate of 8% per annum from the date of the Tribunal's Award, compounded semi-annually, or at such other rate and compounding period as the Tribunal determines will ensure full reparations [sic];

DECLARE FURTHER that:

(vi) The award of damages and interest in (iii), (iv) and (v) is made net of applicable Venezuelan taxes; and

(vii) Venezuela may not deduct taxes in respect of the payment of the award of damages and interest in (iii), (iv) or (v);

ORDER FURTHER that:

(viii) Venezuela indemnify the Claimant in respect of any double taxation liability that would arise in Canada or elsewhere that would not have arisen but for Venezuela's adverse measures;

GRANT:

(ix) Such other relief as the Tribunal considers appropriate; and ORDER that:

(x) Venezuela pay all of the costs and expenses of this Arbitration, including the Claimant's legal and expert fees, the fees and expenses of any experts appointed by the Tribunal, the fees and expenses of the Tribunal, and ICSID's Additional Facility costs".122

185.
The Respondent has made the made the following prayer for relief (as is stated in its latest submission, i.e. its Supplemental Quantum Submission):

"1. the Tribunal lacks jurisdiction to hear Crystallex's claims with respect to the Mine Operating Contract in accordance with Article XII of the Treaty;

2. should the Tribunal find that it has jurisdiction over any or all of Crystallex's claims, then for all the reasons set forth above and in Venezuela's prior submissions, Claimant's claims--including its damages claims--should be dismissed in their entirety; and,

3. Venezuela should be awarded compensation for all the expenses and costs associated with defending against these claims".123

V. THE POSITIONS OF THE PARTIES

186.
Section IV summarizes the Parties' positions as to the disputed facts underlying the dispute. It presents the positions of the Parties by issues, to the extent possible. Section V.A deals with Crystallex's previous mining experience and its investment in Las Cristinas. Section V.B addresses Crystallex's permitting process up to the denial of the Permit in April 2008. Section V.C deals with the issues relating to rescission of the MOC. Finally, Section V.D presents the Parties' positions with respect to the alleged partnerships that Venezuela has concluded with other Parties concerning Las Cristinas, following the rescission of the MOC.

A. CRYSTALLEX'S PREVIOUS MINING EXPERIENCE AND ITS INVESTMENT IN LAS CRISTINAS

1. The Claimant's Position

a. Crystallex was a successful mining company

187.
Crystallex contends that it has been a producer of gold with a successful track record of exploring, developing and operating mining properties and mines in Latin America, in particular in Brazil, Uruguay, and Venezuela.124 In Venezuela, Crystallex operated an open pit mine at Albino 1, in the country's Kilometer 88 region, adjacent to the Las Cristinas site.125 It also conducted mining operations in the El Callao region, by exploiting the Revenin Mill, the Tomi and the Lo Increíble deposits.126 Through these operations, the Claimant contends to have gained the know-how required to operate open pit mines in Venezuela, as well as a network of support personnel and suppliers that could be readily adopted for use in the Las Cristinas project.127
188.
Furthermore, Crystallex's management team was highly experienced.128 It consisted of mining experts with extensive experience working with major gold producers such as Barrick Gold Corporation and major Canadian gold miner, IAMGOLD.129 Moreover, Crystallex claims to have hired first class contractors and consultants for the Las Cristinas project.130 It instructed one of the world's leading mining engineering and construction groups, SNC Lavalin, to prepare the Feasibility Study and the EIS. It also instructed other leading technical consultants, including MDA. Finally, Crystallex had a senior management team with significant financial experience, with familiarity with the financial markets in the US and Canada, which made it possible for Crystallex to raise significant sums of money.131
189.
In any event, even if it was true that Crystallex was a junior mining company and that its management lacked the competence to maximize the value of Las Cristinas or the ability to raise the required financing, as Venezuela contends, this would not, in the Claimant's view, have impacted the underlying value or development of Las Cristinas.132
190.
Crystallex claims that it had the profile of any mining company in an investment phase seeking to achieve asset growth,133 and that it is quite common for junior single asset, or majority single asset gold mining companies, to be loss making when they are in a development phase.134 However, the value of a company hinges on the nature of the assets a company has acquired, on the plans it has to develop those assets and on the value of the cash flows those assets will ultimately produce.135
191.
Furthermore, Crystallex was well known to the CVG because it had been working with the CVG on a number of other projects in the Guyana region, and was thus chosen by the CVG as its contractual partner for good reason.136

b. The Claimant's investment in Las Cristinas

192.
The Claimant describes Las Cristinas as one of the largest undeveloped gold deposits in the world, with resources of 20.76 million ounces of gold (plus an additional 6.28 million ounces of inferred resources) containing proven and probable gold reserves of 16.86 million ounces at a gold price of US$550 per ounce.137 Las Cristinas is, in the Claimant's view, characterized by particularly favorable conditions. An international paved highway, Troncal 10, runs next to Las Cristinas. Furthermore, since 2001, a 400 Kv power line has run parallel to Troncal 10. Thus, any mining project at Las Cristinas would not require the construction of a major long-distance road to access population hubs, nor an independent source of power to supply the mine.138 Moreover, the area also enjoys favorable weather conditions (a temperate climate).139
193.
According to the Claimant, under the MOC, Venezuela assumed no risk in the development of the Las Cristinas project. It was Crystallex who was solely and exclusively responsible for such development and for compliance with the obligations arising under the MOC, including the achievement of annual production goals, regardless of the profitability or economic viability of the project, and notwithstanding gold price fluctuations. In contrast, Venezuela enjoyed a guaranteed income stream at all times.140
194.
The Claimant submits that, in accordance with its obligations under the MOC to implement social programs for the benefit of the communities surrounding Las Cristinas,141 Crystallex generated a significant number of jobs in the local community;142 provided technical support for small-scale mining associations, especially training in environmentally responsible (i.e., mercury-free) mining techniques,143 bore the cost of maintenance, supplies and general operations of the Las Claritas Medical Center, and upgraded the medical center by investing in radiology and dentistry equipment and providing all necessary medical supplies at the site.144 It also built a wholly new medical center at Las Claritas, which however the CVG refused to receive, according to the Claimant.145 In addition, Crystallex built 30 houses;146 provided free training to personnel from the local communities in the handling of machinery and equipment needed for mining operations;147 installed and integrated water treatment systems and built an underground sewage system for use by the local communities;148 paved streets and roads in Las Claritas and Santo Domingo (beyond its contractual obligations under the MOC);149 and carried out education initiatives, including maintaining a program of scholarships and internships for students.150
195.
According to the Claimant, Crystallex invested heavily in bringing the mine to a "shovel-ready" stage. Between 2002 and 2010, it invested over US$500 million in the project, inter alia by acquiring mining and milling equipment that it could assign to the project at a later date;151 by rebuilding and upgrading the campsite;152 by upgrading the access road from Troncal 10 (the road between Kilometer 85 and Las Cristinas);153 by paving and extending the airstrip;154 and by building a solid waste landfill.155
196.
Crystallex hired MDA to complete a reserve and resource model as well as a mine plan. Between 2003 and 2007, Crystallex undertook a number of drilling programs to further delineate the deposit and increase the reserve estimate. A total of 28,427 meters were drilled in 90 holes.156 As a result of these studies and drilling programs conducted while Crystallex was in possession of the site, the proven and probable reserves at Las Cristinas were increased, according to the Claimant, by 77% from the original estimated amount of 9.5 million ounces (according to the 2002 data received by the CVG) to 16.86 million ounces of proven and probable reserves as verified in 2007.157

c. Crystallex's Feasibility Study

197.
As recounted above,158 Crystallex submitted its first version of the Feasibility Study, prepared by SNC-Lavalin, in September 2003. After nearly two and a half years of discussions and negotiations, the Ministry of Mines approved Crystallex's Feasibility study on 6 March 2006.159
198.
According to the Claimant, its Feasibility Study reflected a modular plan that involved constructing a 20,000 tpd processing plant, followed by a second 20,000 tpd processing plant that would take mining up to 40,000 tpd as soon as practicable.160 Crystallex claims that there were financial, technical and common sense reasons in favor of Crystallex's modular approach.161
199.
Crystallex submits that the Feasibility Study was fully compliant with the MOC (as the CVG's approval shows)162 and it was fully compliant with Venezuelan law because the Ministry of Mines approved it in March 2006.163

d. Crystallex raised equity and debt to finance the project

200.
With the aim of raising funding for the project, Crystallex worked with Deutsche Bank and BNP Paribas who designed a financing strategy that would work in stages, mirroring Crystallex's plan to start operations quickly by initially processing 20,000 tpd, but then increase to 40,000 tpd.164
201.
According to the Claimant, the record shows that, at every stage, Crystallex always succeeded in raising funds to go to the next stage in development.165 Even when gold prices were relatively low, Crystallex successfully raised over US$500 million.166
202.
The Claimant explains that its decision to favor equity financing over project finance (at that stage of the project) was based on reasons of convenience and prudent planning.167 In this respect, Crystallex never had any issues raising the financing required to fund the development of Las Cristinas, even during the period after the Permit denial and before the MOC was rescinded.168
203.
Furthermore, some of the major institutional investors worldwide invested in Crystallex.169 During the years in which the permitting process was underway, Crystallex concluded non-disclosure agreements with a significant number of potential investors so as to better enable them to conduct due diligence.170

2. The Respondent's Position

a. General remarks on Las Cristinas

204.
Venezuela first stresses that the geography and topography of the Las Cristinas area presents certain particular challenges to its development, including (i) its location in a remote tropical rainforest, affected by heavy rainfall and seasonal flooding; (ii) the poverty of the soils in the area and the fragility of the ecosystems that rely upon them; (iii) the fact that the site borders the Las Brisas mining concessions and the Cuyuni River (which requires the operator to have a water plan to prevent water build-up in the mines); (iv) the low grade nature of the gold deposit; and (v) the presence of a large number of small-scale illegal miners.171 Furthermore, Las Cristinas lies in the Imataca Reserve, which is a fragile rainforest with an extremely varied biodiversity and a significant indigenous population.172
205.
As a preliminary matter, Venezuela highlights that Crystallex did not hold a "concession" of exploration and exploitation.173 Consequently, it never held a mining title, which carries with it certain rights over the property.174 Rather, consistent with the Venezuelan Constitution175 and Article 23 of the Mining Law,176 the right to explore and exploit the mineral reserve at Las Cristinas was reserved to, and at all times remained with, the State.177 The MOC was thus effectively a service contract, executed on the understanding that the right to explore and exploit the mineral reserve at Las Cristinas ultimately remained with the State, acting through the Ministry of Mines, which, in turn, assigned operations to the CVG.178 However, while Crystallex stood as a mere operator vis-à-vis the CVG, the MOC incorporated certain obligations typical of a concessionaire, e.g. to submit a Feasibility Study within a period of one year from the date of signature of the MOC and to provide so-called "special advantages" (i.e., obligations to promote societal and economic benefits in the area).179

b. Crystallex was a junior mining company with limited experience and uncertain financing

206.
Venezuela contends that Crystallex was a junior mining company that became involved in a project for which it lacked technical, financial and environmental planning capacity.180
207.
For the Respondent, a review of Crystallex's own annual reports reveals that Crystallex self-identified as a junior mining company and operated only a few significantly smaller mines, and moreover, did so at a loss.181 Furthermore, Crystallex played no role in the initial permitting or the closing of the few small mines it operated, and it possessed no experience operating large-scale mines (such as Las Cristinas).182

c. Crystallex's "Feasibility Plan" and other studies were deficient

208.
The Respondent contends that the Feasibility Study presented by Crystallex in September 2003 was initially not approved by the Ministry of Mines, and that it took Crystallex several years to sufficiently address the concerns of the Ministry of Mines with respect to the development and production goals.183 When Crystallex's Feasibility Study was finally approved by the Ministry of Mines in March 2006, it was clear, the Respondent contends, that several technical, environmental and economic parameters still required significant additional work. In particular, according to Venezuela, the Feasibility Study was based on limited drilling, metallurgical testing and environmental work, with much of the analysis based on Placer Dome studies, which resulted in potential inaccuracies.184
209.
For the Respondent, Crystallex never had a concrete plan for developing Las Cristinas that approached a feasibility study level. Rather, it consistently modified central aspects of its project - from the processing plan and mine life (which varied from 20,000 to 40,000 tpd at various different operational life spans), to its reserve estimates, to the cost of capital and operating costs.185
210.
The Respondent notes that the initial "Feasibility Study" produced in September 2003 by Crystallex envisioned that it would take 34 years to extract and process the Las Cristinas deposit at a 20,000 tpd processing rate.186 The reaction of the CVG was that the 34-year mine life exceeded the 20-year initial term of the MOC.187 Further, in a 4 December 2003 letter, the CVG reiterated its preference for a 20-year mine life and a 40,000 tpd production capacity.188
211.
The "Additional Clarifications" produced by Crystallex on 19 December 2003 envisioned a production capacity of 20,000 tpd for the first seven years, followed by a production capacity of 40,000 tpd for the subsequent 13 years.189 However, the Respondent points out that only one month later, SNC-Lavalin produced a drastically different "Feasibility Study" that proposed processing 40,000 tpd from year 1 through year 20.190 For the Respondent this study was not presented as an alternative to the CVG (as the Claimant contends), but it was the project feasibility study.191
212.
In February 2004, Addendum 1 was produced to the CVG,192 in which Crystallex explained that for financing reasons it could not state a production capacity of 40,000 before year 9.193 The CVG approved and sent the 2003 SNC-Lavalin "Feasibility Study" together with the Addendum to the Ministry of Mines for approval.194
213.
The Respondent contends that all of these studies suffered from a fundamental flaw based on their reliance on largely unverified drilling data from the Placer Dome data set.195
214.
Furthermore, the Respondent points out that in August 2005, Crystallex produced yet another plan for its project, the so-called SNC-Lavalin Development Plan,196 which would have a processing capacity of only 20,000 tpd and a mine life of 41 years, without any reference to eventually expanding to a 40,000 tpd processing capacity at a later stage.197 And two months later, in the so-called SNC-Lavalin "Expansion Plan",198 Crystallex proposed that it would mine 20,000 tpd in the first two years and then expand to 40,000 tpd in year 3 until year 23.
215.
Finally, in November 2007, MDA produced a technical report199 that once more, according to the Respondent, changed the overall project plan, by proposing that the deposit would be mined at 20,000 tpd, resulting in a mine life of 64 years.200
216.
Thus, the Respondent contends that Crystallex's constant vacillation regarding two of the most important aspects of the overall project (i.e., processing capacity and mine life) yields the inescapable conclusion that it was unable to develop a concrete viable plan that would be palatable to both investors and the Venezuelan regulatory agencies.201 Crystallex never presented a true feasibility study with a single comprehensive plan for the development and operation at Las Cristinas. The studies presented, to the contrary, offered varying and distinct plans that went to the very core of the operations.202
217.
Thus, the Respondent concludes that "[w]hile the Ministry of Mines, in a good faith effort to move the project along, agreed to accept Crystallex's September 2003 "Feasibility Study" as supplemented by the February 2004 "Addendum", this did not mean that Crystallex met its commitment to submit a fully realized plan for the Las Cristinas project (as demonstrated by the various subsequent efforts)".203

d. Crystallex's ability to raise financing is overstated

218.
Venezuela contends that it is difficult to square Crystallex's current position that project financing, and the institutional lenders who might have provided it, were irrelevant and, therefore, are of no consequence to determining whether it had a viable project, with its repeated statements to the contrary in the years when it was pursuing the permitting process.204
219.
In this respect, the Respondent points to statements made by Crystallex before, during and after the permit review process to the effect that it would seek project financing.205
220.
For Venezuela, project financing and bank lending would have been necessary components of any financing for a major project like Las Cristinas. However, the Respondent suggests that Crystallex never obtained traditional project financing from institutional lenders - including from its advisors BNP Paribas and Deutsche Bank -most likely because Crystallex's history of operational losses and constantly evolving plans for Las Cristinas did no meet the strict due diligence criteria that those lenders employ.206
221.
Pointing to Crystallex's own annual reports and financial information, the Respondent contends that Crystallex struggled at every step to obtain sufficient financing to develop, construct and operate Las Cristinas.207 Thus, even if Crystallex had received the Permit in April 2008, the tightness of the credit markets following the worldwide financial crisis in late 2008 virtually eliminated whatever chances Crystallex had to raise funding for the project.208

B. THE DENIAL OF THE PERMIT

1. The Claimant's Position

222.
The Claimant contends that the Permit it was seeking from the Ministry of Environment in order to exploit Las Cristinas was denied in an arbitrary manner, unrelated to the EIS approval process. It claims that the technical review of the EIS was successfully concluded on 16 May 2007, when the Ministry of Environment notified Crystallex that it had "analyzed and approved" the EIS; that the 16 May 2007 letter did not relate only to preliminary works, but to the entire Las Cristinas project; that the Permit that was promised in such letter was for exploitation, and not for exploration. With regard to the denial of the Permit in April 2008, the Claimant submits that one key document on which the denial is based is fraudulent, and that the Permit denial itself is defective in its own terms. It also contends that, after the Permit denial, Venezuela subjected Crystallex to a "rollercoaster" of mistreatment because on the one hand it made the company believe that it could still obtain the Permit, and on the other hand it threatened to nationalize or "take back" Las Cristinas.

a. The technical review of the EIS was completed in 2007

223.
The following paragraphs summarize the Claimant's position as to the main steps in the exchanges between Crystallex/the CVG and the Venezuelan authorities, in particular the Ministry of Environment, concerning the environmental aspects of the project.

i. 2003/2004: The EIS is submitted to the CVG and the Ministry of Environment

224.
The 950-page EIS was prepared by Crystallex with SNC Lavalin and submitted to the CVG for review in December 2003.209 A revised draft of the EIS, following comments by the CVG to Crystallex, was submitted on 27 February 2004.210 On 15 April 2004, on the same day the CVG submitted the Feasibility Study to the Ministry of Mines, the CVG submitted the EIS to the Ministry of Environment's offices in Bolívar State and Caracas for approval.211 The Claimant stresses that the EIS submitted on 15 April 2004 was for the whole project, i.e. it addressed the impact of the entire Las Cristinas project, from construction through operation to mine closure.212

ii. 2004: Crystallex submits Addenda to the EIS and further studies

225.
In May 2004, Crystallex submitted a "Technical Forestry Report" and a "Forestry Repopulation Plan".213
226.
On 31 May 2004, the Ministry of Environment (Bolívar) sent the CVG written technical observation on the EIS.214 These addressed, inter alia, the following items: water management issues; whether additional baseline data would be collected; the size of the tailings management facility; the risk of acid rock drainage in the tailings pond; why the chapter of the EIS setting out the environmental supervision plan was in outline form; the extent of the forestry inventory; resettlement plans for illegal miners; why it was not planned to process copper; the socio-economic impacts of the project; and the nature of the diversion channel.215
227.
Crystallex contends to have answered those questions from the Ministry "to its entire satisfaction",216 by submitting on 15 June 2004 a response along with a report prepared by SNC Lavalin for that purpose.217
228.
On 1 July 2004, the Ministry replied stating that "all technical and legal factors requested by this Office were duly clarified".218 However, it added that a number of outstanding issues still remained to be resolved before the Permit could be issued. Those included the fact that the Feasibility Study had first to be approved by the Ministry of Mines; whether the diversion channel would flow through the Potaso pit or around it; and whether the water diversion channel would be designed to withstand a 200-year flood of all four streams whose water it was designed to carry.219 The Ministry concluded by stating that "once the missing supporting documentation is received, this Office will immediately issue the requested permit".220
229.
On 12 July 2004, Crystallex addressed these concerns in a letter to the Ministry of Environment.221
230.
On 21 July 2004, the Ministry of Environment (Bolívar) wrote to the CVG stating that all future decisions about Las Cristinas would be taken by the Ministry of Environment in Caracas.222
231.
On 25 August 2004, the CVG submitted Addendum No. 1 to the EIS to the Ministry of Environment (Caracas).223 On 16 and 23 September 2004, representatives of the CVG and Crystallex gave a presentation about the plans described in the EIS to officials at the Ministry of Environment.224 Questions raised by the Ministry in those occasions were answered in Addendum 2.225
232.
On 15 September 2004, the CVG and Crystallex submitted a 394-page environmental supervision plan for the construction phase of the project, which was to serve as a practical guide for the implementation of the environmental mitigation measures undertaken during construction.226 Crystallex contends that the environmental supervision plan covered the entire construction phase, not merely "preliminary construction-type works".227
233.
In September 2004, Crystallex also submitted an Addendum No. 3 to the EIS, which incorporated the results of two Baseline Studies performed by consultant Proconsult.228 Addendum 3 described the socioeconomic impacts of the project in greater detail than the original EIS and was prepared by conducting interviews with members of the surrounding communities, including indigenous community leaders.229 Addendum 3 also provided a 7-phase plan for relocating illegal miners.230

iii. The 29 December 2004 letter from the Ministry of Environment: Exhibit C-159

234.
On 29 December 2004, the Office of Permissions at the Ministry of Environment replied to the CVG's letter of 15 April 2004, under cover of which the EIS had first been submitted.231 This 3-page letter sent on 29 December 2004 is, according to the Claimant, the only letter containing written observations about the EIS that the CVG or Crystallex were to receive from the Ministry during the two year period between 20 July 2004 and 31 July 2006.232 In this letter, the Ministry made observations, inter alia, on the fact that the EIS had been presented without prior terms of reference, and on the fact that the social, cultural and environmental impact of the project had been underestimated. Furthermore, it noted that the social impact associated with the illegal miners whom Crystallex would not employ had not been clearly defined. The Ministry concluded by demanding that the project be reformulated, starting with the preparation of new Terms of Reference.233
235.
According to the Claimant, the imprecise and vague observations contained in the three-page letter of 29 December 2004 made it difficult for Crystallex to understand how exactly it should have reformulated its plan.234

iv. 2005-2006: Further exchanges and the Porlamar meeting

236.
According to the Claimant, following the appointment of Jacqueline Faria as new Minister of Environment in early 2005 (with related change in Ministry personnel), the Ministry changed course over its prior request that Crystallex start the project from scratch.235
237.
During 2005, a number of workshops were held with the new Ministry personnel.236 For the Claimant, there is no merit to Venezuela's assertion that the Ministry spent the whole of 2005 making "continued requests" for information.237 In contradistinction, Crystallex argues that, in the first six months of 2005, the Ministry of Environment made only a single request for further information, when it requested an updated baseline study in relation to vegetation, fauna and the quality of the environment.238 The only other feedback Crystallex received was on the environmental social plan.239
238.
In June 2005, the Minister of Mines publicly stated that the status of the Permit was "well on track" and that the issuance of the Permit was "following its normal, routine course. It's a bureaucratic formality".240
239.
In July 2005, Crystallex completed the "Social Investment Plan", which was the result of consultations with indigenous and criollo communities located in the project's zone of influence.241 This plan designed a number of social programs, ranging from promoting environmental conservation to supporting alternative to mining and enhancing community relations.242 The Social Investment Plan was presented at a workshop with the Ministry on 19 July 2005.243
240.
Crystallex claims that in March 2006, it had to resubmit to the Ministry thirteen boxes of documents containing the EIS and related documents, because the Ministry had allegedly lost the files.244
241.
On 31 July 2006, the Ministry of Environment wrote to the CVG concerning the Las Cristinas Permit application.245 According to the Claimant, the letter did not contain any analysis of Crystallex's EIS or the many other documents it had submitted for review during this period. Instead, the Ministry declared that, given the size and importance of the project, it intended to undertake a "Strategic Environmental Evaluation".246 Such Strategic Environmental Evaluation for the Claimant is not a recognized or required procedure under Venezuelan law, but simply a "bureaucratic contrivance" that had been employed by the Ministry only once before in a project involving PDVSA.247
242.
On 17-18 October 2006, meetings organized by the Canadian embassy in Venezuela were held at Porlamar, which were attended by the Ministry of Environment (represented by Mr. Rodriguez, a witness in this arbitration), by Crystallex and by Gold Reserve, the operator of the adjacent Las Brisas concession (the "Porlamar meeting").248 According to the meeting minutes,

"There is an order from the Minister of the Environment, Eng. Jacqueline Faria, for expediting the issuance of environmental permits for both projects. In that regard, Rodriguez informed that Minister Faria had instructed that the procedure to grant permits be completed as soon as possible, and so did Vice Minister Nora Delgado, who also ordered that the procedure to grant permits be hastened until they were granted".249

243.
Further, according to the meeting minutes, the Ministry inquired about the cumulative impact caused by both projects (Las Cristinas and Las Brisas) and wished to see Gold Reserve and Crystallex agree on surface water drainage management, in particular, the movement of the diversion channel.250
244.
At the meeting, Crystallex and Gold Reserve were able to agree, amongst other things, that the diversion channel would be moved (at Crystallex's expenses) to the north, in order to accommodate the desire of Gold Reserve to maintain access to ore extending beyond the boundaries of its concession.251
245.
On 21 November 2006, Ms. Laura Paredes, also a witness in this arbitration and then Director General for Mining Concessions at the Ministry of Mines, wrote an internal memorandum to Minister of Mines José Khan summarizing the key information about the Las Cristinas project, and recommending that Minister Khan forward this memorandum to the Minister of Environment with a view to accelerating the Permit process.252 The memorandum reads in relevant parts:

"Currently, Crystallex in full co-ordination with the CVG, has already complied with all its pre-construction obligations, including all the works of social interest that were required. Likewise, it has already carried out all the important and difficult activities to ensure the financing of the main project. Complying with its undertaking to build in record time, it has already purchased machinery and parts for more than 75 million dollars and has concluded contracts with the necessary third parties for the additional sum of 90 million dollars. Nonetheless, the construction of the Las Cristinas Project has not been able to begin, given that it is still waiting for the Minister of the Environment to issue the permit for affecting natural resources. This permit was requested by the CVG in conjunction with Crystallex. While waiting for the permit, Crystallex is bearing the enormous cost of maintaining the equipment in storage at international ports and continuing the payments for the contracts and financing services, which cannot continue indefinitely given the enormous financial burden this imposes.

FOR ALL THE ABOVE CONSIDERATIONS, HAVING VERIFIED THE LEGALITY OF THE CONTRACT, IT IS SUBMITTED THAT THE CITIZEN PRESIDENT SEND THE PRESENT MEMORANDUM OF INFORMATION TO THE HEAD OF THE MINISTRY OF THE ENVIRONMENT, CITIZEN JAQUELINE FARIA IN ORDER TO OBTAIN THE ISSUE OF THE ENVIRONMENTAL PERMIT".253

v. The 22 December 2006 meeting and subsequent exchanges

246.
It is further the Claimant's argument that on 22 December 2006, a meeting was held between the CVG, Gold Reserve and the Ministry of Environment, to discuss the permitting process and certain documents that the Ministry had requested by way of letter on 19 December 2006.254 According to the Claimant, the minutes of the 22 December 2006 meeting show that the CVG was told that the Environmental Permit to build the mine at Las Cristinas would be issued within three months if certain documents were delivered.255 The Claimant disputes Venezuela's reading of this meeting, whereby the Ministry informed the CVG that, if certain documents were produced they would receive a preliminary permit only for certain limited infrastructure works that Crystallex had requested two and a half years before when it first applied for the permit.256 The Claimant points at the minutes that list a number of items in relation to which the Ministry committed to issue a permit (if certain documents were provided). These items included the "construction of the processing plant" and "opening of pits". Thus, the minutes show that the Permit to be issued would cover issues that are at the very heart of the construction of the mine and formed no longer part of the long abandoned preliminary request made in 2004.257
247.
For the Claimant, the Ministry could not grant a preliminary permit to engage in the cost of construction of a processing plant and a deviation channel without the certainty that such plant would be permitted to operate.258
248.
The Claimant disputes the relevance of the distinction between a "short term" and a "medium term" permitting process, which is emphasized by Venezuela by reference to these minutes. According to Venezuela, the Permit to be issued on a "short term" basis (within 3 months, according to the minutes) could only relate to preliminary works.259 The Claimant rebuts that the projects listed in the minutes as being "medium terms" priorities for which a Permit could be expecting in "approximately three years" related to the two projects that Gold Reserve and Crystallex had agreed to build jointly at the Porlamar meeting (i.e., the community landing strip and sanitary landfill for San Isidro Parish).260 Only those two projects were to be subject to "medium term" approval, and importantly neither of those joint projects was required to construct or to operate any of the mines.
249.
Crystallex further claims that it answered each of the Ministry's queries to the 19 December 2006 letter in an 8-volume submission dated 16 February 2007.261
250.
On 27 March 2007, Laura Paredes, the Director General of Mining Concessions at the Ministry of Mines, who had also been sent a copy of the latest Crystallex submission262 and who had been liaising with the Ministry of Environment, wrote to Crystallex, stating that:

"Knowing that the company Crystallex has complied duly and opportunely with all of the requirements imposed by the Ministry of Environment during the meeting of 22 December 2006, this Directorate has learned directly from the Directorate General of Permissions at the Ministry of the Environment that they are waiting [to receive] from the CVG the following requirement.

Plan for the use of copper so as to minimize environmental damage".263

251.
This additional information was sent by the CVG to the Ministry of Environment on 17 April 2007.264

vi. The 16 May 2007 letter from the Ministry of Environment

252.
On 16 May 2007, the Ministry of Environment, through its then Vice-Minister of Environmental Administration and Governance, Merly Garcia, sent a letter to Crystallex, inviting it to post a Bond and to pay certain environmental taxes, after which the Permit would be handed over.265 According to the Claimant, through this letter the Ministry of Environment approved the EIS, including the proposed measures and programs contained in such study for the preservation of the environment, which the Ministry expressly indicated had been "analyzed and approved".266 Thus, Crystallex contends, at this point in time it had complied with all of the substantive requirements to obtain the environmental Permit.267
253.
The 16 May 2007 letter, which for Crystallex expressed the Ministry's approval of the EIS and the promise to issue an environmental Permit subject only to the fulfillment of a procedural formality is, for the Claimant, of fundamental importance, because it shows that the Ministry was fully satisfied with the last round of documents it had received from Crystallex in early 2007.268 The 16 May 2007 letter was the culmination of the technical process that had begun when Crystallex submitted its EIS to the Ministry of Environment in April 2004.269

vii. The posting of the Bond, the payment of the taxes and the draft Permit

254.
On 18 May 2007, Crystallex complied with the remaining formalities mentioned in the 16 May 2007 letter, i.e. the posting of the Bond and the payment of the environmental taxes.270
255.
Around this time, Crystallex claims to have received a draft of the Permit from the Ministry of Environment.271 According to the Claimant, the Ministry asked Crystallex to help it finalize the Permit by verifying the accuracy of some technical details, such as the exact coordinates of the mine site.272

b. The letter of 16 May 2007 did not relate only to preliminary works

256.
According to the Claimant, the Permit promised in the Ministry letter of 16 May 2007 did not relate only to preliminary works, as the Respondent contends. Crystallex submits that Article 14 of Decree 1757, the key source of regulations governing EISs in Venezuela, provides for a single environmental permit covering all of the stages of a project, which rules out the possibility of obtaining a partial permit that would not allow Crystallex to build the mine and extract gold from Las Cristinas.273 The Administration cannot authorize the construction of an entire mining complex, including a processing plant and 8-km-long diversion channel, if it does not also approve all of the measures described in the EIS for the construction, operation and closure of the project.274 In other words, Venezuelan law requires an EIS - with all its impacts and related mitigation measures - to be approved as a whole.275 An approval of only part of an EIS and the issue of a partial environmental Permit would mean that construction of a project could begin before the fundamental question of whether the environmental impact of the project was tolerable had been resolved, which in Crystallex's view is impermissible under Venezuelan law.276
257.
Crystallex explains that, initially, Crystallex and the CVG believed that quicker progress could be made if an early authorization could be obtained for certain preliminary work that would prepare the site for major construction works.277 Thus, the CVG explained to the Ministry of Environment, when submitting the EIS on 15 April 2004, that it was also seeking preliminary authorization for a number of items, such as the extension of access roads into the site, the construction of a diversion channel, the construction of a sanitary landfill.278 However, according to the Claimant, this request for preliminary permit was abandoned by the CVG/Crystallex in late 2004 as the Ministry of Environment took the view that the EIS for the Las Cristinas project had to be approved before it would permit works to be undertaken that would impact the environment.279 For the Claimant, between April 2004 and May 2007, the Ministry of Environment raised questions regarding several aspects of the project, from the construction of the mine, to its operation, closure and reclamation, to which Crystallex responded.280 Furthermore, as discussed above,281 the minutes of the 22 December 2006 meeting clearly show, according to the Claimant, that the Ministry was prepared to issue an Environmental Permit for the infrastructure works necessary to build the entire mine.282
258.
Furthermore, according to the Claimant, the measures listed at the end of the 16 May 2007 letter, whose implementation the Bond was supposed to secure (and which according to the Claimant contained elements of construction, operation and closure of the mine), greatly exceeded the scope of those preliminary works and clearly related to the entire project described in the EIS.283
259.
It would make no sense for the Ministry to request a bond if the scope of the measures that it is supposed to guarantee - which form the basis for the calculation of its amount - had not been already approved.284

c. The promised Permit was for exploitation, not for exploration

260.
Crystallex contends that the Permit that was promised in the 16 May 2007 letter was for exploitation, and not for exploration. The fact that the letter refers, in two passages, to "exploration" (and not to "exploitation") is, in the Claimant's view, merely the result of a typographical error, as can be deduced from the context of the approval and the numerous other documents following on from the 16 May 2007 letter which replace the erroneous word "exploration" with the intended term "exploitation".285
261.
First, the EIS referred to in the 16 May 2007 letter, which was said to have been "analyzed and approved", made no reference whatsoever to any exploration activity, and dealt with the construction, exploitation and closure of the mine.286
262.
Second, other documents on the record show that what was at issue in the 16 May 2007 letter was exploitation.287 The Claimant points in particular to the letter from the Ministry of Environment to the CVG dated 23 August 2007, which states that the Permit promised in the 16 May 2007 letter was for (a) the construction of infrastructure and services; and (b) the exploitation phase of the Las Cristinas project.288
263.
Furthermore, as a matter of Venezuelan law, a permit that relates to the construction of a mine is, by definition, a permit for exploitation since the concept of exploitation includes the construction phase.289 Moreover, Crystallex's EIS was prepared in conjunction with the Feasibility Study, and in fact they were delivered to the Ministry of Environment and the Ministry of Mines, respectively, on the same day (on 15 April 2004).290 Because Decree 1757 establishes that an EIS for the exploitation phase should accompany a Feasibility Study, it follows, for the Claimant, that the measures described in the EIS and any permit issued on the basis of such measures were going to relate to the exploitation phase of the project.291
264.
Finally, the exploration phase of the project had already been concluded by Crystallex (and, before, by Placer Dome).292
265.
Also, the bond requested clearly related to exploitation. This is evident if one compares its amount (B$5.2 billion) to the amount of B$20.7 million which had been requested in 2006 in connection for an application of an exploration permit (to conduct exploratory drilling of 40 holes).293

d. The permitting process was technical, not discretionary

266.
For the Claimant, there was nothing discretionary about the duty of the Ministry of Environment to issue the Permit promised in the 16 May 2007 letter, once Crystallex had duly paid the stamp tax and the Bond requested by the Ministry. Crystallex contends that Article 27 of the Stamp Tax Law provides that the tax whose payment was required by the Vice-Minister of Environment is payable simultaneously with the issuance of the Permit.294 Furthermore, Article 45 of Decree 1257 provides that the purpose of bonds like the one requested by the Vice-Minister of the Environment is to guarantee the measures contemplated in the EIS.295 It would only be reasonable, in the Claimant's view, to expect that a bond would be required at the end of the permitting process, once the measures and the EIS itself had already been approved by the Ministry of Environment.296
267.
For the Claimant, the power to issue an environmental permit requires determining whether a certain harm to the environment is a "tolerable harm", which can be made only after a rigorous technical, environmental and socio-economic analysis has been conducted.297 When so-called "indeterminate legal concepts" of a technical nature, such as "tolerable harm" (which is not specifically defined under Venezuelan law), are involved, the relevant decision by the Administration depends strictly on the result of the technical analysis conducted in the case in question.298 In those cases, the decisionmaker is not given any form of discretion or the power to factor in considerations of opportunity or convenience.299
268.
For the Claimant, once the EIS approval was granted based on technical elements, there was no further discretion in relation to the issuance of the Permit. For that reason and in any circumstances, the 16 May 2007 letter uses imperative language: "Once the Bond has been posted, checked and found to be compliant by this Office, the [Permit] will be handed over " (les será entregado, in the Spanish original).300

e. After the 16 May 2007 letter, Crystallex expected prompt issuance of the Permit

269.
According to the Claimant, its expectation that it would promptly receive the Permit after 16 May was based not only on the terms of the 16 May 2007 letter, but also on past experience. In 2006, Crystallex had sought and received an environmental Permit to conduct further drilling at Las Cristinas. In that instance, the Permit was handed over to Crystallex on the very same day that the bond was posted.301 Crystallex was also aware that in March 2007 it had taken Gold Reserve only one week from the posting of the bond and the payment of the taxes to be issued the relevant environmental permit for the adjacent Las Brisas site.302
270.
Furthermore, the expectations that the Las Cristinas Permit would be quickly delivered were strengthened, according to the Claimant, on 22 May 2007, when just four days after Crystallex had posted its Bond and paid its taxes, it received a draft copy of its environmental Permit. Crystallex argues that this draft Permit clearly shows that the work of preparing the Permit had already been completed.303
271.
On 4 October 2007, the National Assembly Committee on Economic Development called a hearing to discuss the permitting process at Las Cristinas.304 In addition to Crystallex's representatives, Mr. Sergio Rodriguez, representing the Ministry of Environment, and Ms. Laura Paredes, representing the Ministry of Mines, testified at that hearing.305 According to the minutes,

"Laura Paredes, MIBAM's representative, placed no obstacles to the granting of the permits, since the Ministry represented by her already issued the corresponding license for the beginning of the development of the project. She emphasized the importance of the participation of the Community Councils, particularly in relation to special advantages".306

272.
Furthermore, according to the minutes,

"Eng. Sergio Rodriguez, Planning Director of the MARN, referred, in general, to environmental aspects. He also agreed with the matters related to the participation of Community Councils in the projects to be developed".307

273.
The Claimant underscores that, at the hearing, the Chairman of the Committee, Deputy Gutierrez, confirmed that based on "conversations held with the highest authorities of the Ministry of the Environment, [...] there is no legal impediment for the [Ministry of the Environment] to grant the permits".308 The official report set out the following conclusions:

"In accordance with the statements of the participants in this meeting, the following conclusions are drawn:

1 - The concessionaire, Corporación Venezolana de Guayana (C.V.G), and the operator, Crystallex International, have complied with both the feasibility study and the other legal and technical requirements established for the corresponding permits to be granted to them by the Ministry of the Environment for the commencement of the construction and development of Las Cristinas Project.

2 - The delay in the granting of the permits affects the operator, due to the significant burden of personnel and maintenance expenses and socioeconomic expenditure that it has. It also delays a great part of the benefits for the community established in the agreement in relation to employment, housing, and education matters.

3 - The Chairman of the Committee reiterates demands to the Ministry of Environment to grant the corresponding license, thus allowing the mining development to begin".309

274.
The Claimant submits that, because the minutes confirm that the National Assembly's conclusions were drawn "in accordance with the statements of the participants in this meeting",310 Crystallex understood that both the Ministry of Mines and the Ministry of Environment, through their representatives, were in agreement that Crystallex had complied with every legal and technical requirement to receive the environmental Permit.311

f. The Permit was denied in an arbitrary manner unrelated to the EIS

275.
For the Claimant, there was no technical or legal basis for the permit denial. For the Claimant, the Permit denial letter is defective in its own terms, and furthermore is based on only one internal "technical report", which in the Claimant's view is likely to have been fabricated ex post facto to justify the Permit denial.
276.
The Claimant contends that the Permit denial came "as a shock" to Crystallex given that approval of the EIS had already taken place and the Ministry of Environment had confirmed that the Permit would be handed over after the posting of the Bond and the payment of the required environmental taxes.312
277.
According to the Claimant, the justifications adduced by the Ministry of Environment (i.e., concerns for the environmental and indigenous people of the Imataca Forest Reserve) had never been raised during the four-year approval process and were not supported by a single study or document to demonstrate that the project would adversely impact the Imataca region, where mining activities had already been expressly authorized.313
278.
For Crystallex, the Permit denial letter of 14 April 2008 fails to refer to a single page or paragraph of the 948-page EIS submitted in April 2004, to any of the thousands of pages of addenda and supplementary reports to that study, or to any of the 460 pages submitted in February 2007 in response to the Ministry's final request for information of 22 December 2006.314 The Permit denial vaguely alludes to unidentified "technical inspection reports" about illegal mining and "research carried out by the specialists competent in the matter", without any more specific support.315
279.
The Claimant has further developed the following arguments as to why the Permit denial lacked support and was arbitrary.

i. The Permit denial is based on one fraudulent document: Exhibit R-52

280.
For the Claimant, the technical inspection report, allegedly prepared in September 2006, filed by Venezuela as Exhibit R-52, is the only technical report on the record that categorically recommends the denial of the environmental Permit.316 The Permit denial letter of 14 April 2008 closely resembles Exhibit R-52.317 One will see below that the Respondent avers that Exhibit R-52, also referred to as the "Technical Inspection Report" or the "Romero Report", foreshadows the letter which denied the Permit in April 2008. For Crystallex, the consistency and authenticity of Exhibit R-52 is of great importance because Venezuela, through the process of document disclosure in this arbitration, has confirmed that there were no other technical inspection reports, environmental studies, research data or reports of any kind referred to in the Permit denial letter or relied on in the preparation of that letter.318 Thus, the Permit denial was based on just one document: Exhibit R-52.319
281.
For the Claimant, during the Hearing it became apparent that the report is not a genuine contemporary record of any actual site inspection, but a fraudulent document apparently created well after September 2006 for the purpose of justifying the Permit denial.320
282.
First, according to the Claimant, the alleged date on which the report was prepared (September 2006) raises a number of inconsistencies with other contemporaneous documents, which appear to suggest different courses of actions (e.g., requests for additional documents from Crystallex).321 For example, in October 2006, Mr. Sergio Rodriguez, one of Venezuela's witnesses, told the representatives of Crystallex and Gold Reserve at the Porlamar meeting that the process of issuing the permits was to be accelerated.322 Further, on 22 December 2006, Crystallex was given a list of additional documents it was required to provide for the Permit to be issued.323
283.
More importantly, for the Claimant the document is "nothing but a crude forgery".324 Crystallex explains that the report is printed on a letterhead bearing the name of the " Ministerio del Poder Popular para el Ambiente ". However, the Claimant explains, in September 2006 the Ministry of Environment was called the " Ministerio del Ambiente ". It did not change its name to " Ministerio del Poder Popular para el Ambiente " until 8 January 2007, when the Venezuelan Official Gazette published Presidential Decree 5103 issued by President Chávez on 28 December 2006, through which the prefix " del Poder Popular " was added to the names of all Venezuelan Ministries.325
284.
At the hearing, Ms. Charly Rodriguez, a technician in the Bureau of Environmental Quality, explained this apparent inconsistency by suggesting that the report could have been prepared on a computer immediately after a site inspection in September 2006, but that it had probably been printed out at a later date using the Ministry's updated letterhead.326 However, the Claimant underscores that even the text of Exhibit R-52 (and not just the letterhead) refers to the " Ministerio del Poder Popular " in one passage. Ms. Rodriguez suggested that the Ministry might have started using the new name after an announcement by President Chávez on his television program "Aló Presidente".327 However, this, for Crystallex, is impossible, as the first announcement about the new ministerial name was made at the end of December 2006, i.e. three months after Exhibit R-52 was supposedly written.328
285.
Clear proof of this, according to the Claimant, derives from the fact that none of the Ministry's letters and internal documents on record in this arbitration dating form the period September 2006 to end-December 2006 contain body text or a letterhead that refers to the " Ministerio del Poder Popular ".329
286.
For the Claimant, the conclusion is thus unavoidable: Exhibit R-52 was written long after September 2006, and it was tailor-made after the fact to justify the conclusion in the Permit denial letter of 14 April 2008. Exhibit R-52 is thus "a crude fraud incapable of being a valid source ofjustification for the conclusion in the Permit Denial Letter".330
287.
Even if Exhibit R-52 were a genuine document, in the Claimant's view it could not justify the denial of the Permit under Venezuelan law or the Treaty because its alleged justifications are unreasonable, illogical, inconsistent and technically unsound.331 Crystallex submits that the report does not contain a single specific reference to any page of the EIS or its addenda. No data is annexed to the inspection report itself. No comparisons are made with data in the EIS or its addenda.332 Furthermore, according to the Claimant, it was prepared without the participation of key technical departments that were required to participate as a matter of Venezuelan law, specifically the Forestry Department and the Ministry of Environment in Bolívar State.333
288.
In conclusion, even if it were a genuine document (which the Claimant denies), the Technical Inspection Report cannot form the basis for a permitting decision.

ii. The Permit denial letter was defective on its own terms.

289.
The Claimant additionally contends that the Permit denial letter of 14 April 2008 was defective in its own terms. The Claimant addresses the reasons mentioned in the letter for which the Permit was denied by the Ministry of Environment, and makes the following observations.

a. Mining in the Imataca Forest Reserve. The Claimant recalls that the Imataca Forest Reserve had been expressly designated for mining and forestry use in the Presidential Decrees of 1997, 2002 and 2004.334 Therefore, there was no reasonable or rational basis to assert that the Las Cristinas mine should be halted for the purpose of "preserving the environment in the Imataca Forestry Reserve".335 It is noteworthy, the Claimant argues, that the Permit denial letter makes reference to "the Decree" when justifying the alleged problems in the project, without clearly identifying which Decree precisely it is referring to.336 Furthermore, the fact that the Las Cristinas mine was given to CITIC/Minera to develop in 2012 shows that this excuse is "frivolous and arbitrary".337

b. Global warming. Crystallex argues that nowhere on the administrative file (except in Exhibit R-52) is there any analysis of the issue of global warming or carbon emissions in relation to the Las Cristinas project.338 And even in that document, no attempt was made to include any kind of scientific data or analysis (e.g., carbon emissions analysis, etc.).339

c. Effects of illegal mining on the environment. For the Claimant, the Permit denial letter makes no attempt to explain how Crystallex and the project described in its EIS could possibly be to blame for the actions of the illegal miners, nor why the proposed properly constructed industrial mine would not improve the environmental situation.340

d. Alteration to hydrology. The Claimant contends that no criticism was raised about Crystallex's hydrology plans by the Ministry of Environment in its letter to the CVG of 16 May 2007. Furthermore, Crystallex points out that on 27 March 2007, Ms. Laura Paredes of the Ministry of Mines informed Crystallex that she had learned from the Ministry of Environment that it was satisfied with the documents it had received.341 Not a single document exists, in the Claimant's view, on the record to show that, at some time between 16 May 2007 and 14 April 2008, the Ministry of Environment commissioned a technical report re-analyzing the approach to hydrology described in Crystallex's EIS or the other documents it had produced up to including February 2007. Also in this respect, the Claimant concludes, the Permit denial is arbitrary, illogical, unsupported and procedurally irregular.342

e. Threat to biodiversity. The Claimant argues that not a single specific reference is made to a page of Crystallex's EIS or its addenda - including the 470-page biodiversity report. The letter refers to "research carried out by specialists competent in the matter", without, however, referring to any facts, data or figures in the administrative file.343 The Claimant points out that the measures approved in the 16 May 2007 letter include a "surface water quality protection program", a "ground water quality protection program", a "soil quality protection program", an "erosion control and drainage management plan", a "forest resource protection and use program" and a "wildlife protection program".344 Even if the Ministry had revisited Crystallex's biodiversity studies at some time prior to April 2008 and concluded that further work was required, a proportionate response would have been to ask that such work be carried out. Outright rejection of the Permit was utterly disproportionate.345

f. Need for public consultation. Crystallex submits that it engaged in extensive consultations with the local communities and indigenous population over the course of several years. In 2005, Crystallex submitted the Social Investment Plan, which covered the results of those consultations.346 In February 2007, Crystallex had provided the Ministry of Environment with a comprehensive report assessing its performance of the Social Investment Plan.347 The Claimant submits that no reasons were given in the Permit denial letter as to why the extensive public consultations already carried out by Crystallex were defective, and no facts, data or figures were provided in this respect.348

g. Plan for small miners' relocation. According to the Claimant, the Permit denial letter avoids addressing any specific element of Crystallex' EIS in this respect. Crystallex claims that it had submitted plans for dealing with the small miners and the indigenous communities.349

g. Crystallex provided all the information it was asked to provide

290.
Crystallex argues that Venezuela's contention that the Claimant failed to provide information that had been "consistently requested" by the Venezuelan authorities is not even mentioned in the Permit denial letter.350 In any event, the record shows that Crystallex consistently satisfied the requests for information it had received and that, at the time of the approval of the EIS in May 2007, it had fully responded to all of the Ministry of Environment's outstanding requests.351 This, in the Claimant's view, explains why the EIS was approved and a promise made to "hand over" the environmental Permit in May 2007 upon presentation of the bond.352
291.
In particular, Crystallex contends that it had resolved most of the issues to the satisfaction of the Ministry of Environment in Bolívar State in 2004, before the reviewing process passed to the office in Caracas.353 Furthermore, the Claimant argues that the Ministry in Caracas took two years even to distribute key documents internally between the different departments which were supposed to review the EIS according to their area of expertise.354 With specific regard to the 22 December 2006 meeting, on which Venezuela relies, Crystallex responded in February 2007 by submitting the requested information.355
292.
The Claimant points to the letter of 27 March 2007, in which Ms. Paredes confirmed that the Ministry of Environment had received the information provided by Crystallex in response to each of the Ministry's requests made on 22 December 2006, with the sole exception of one document relating to copper,356 which was subsequently duly provided by Crystallex on 25 April 2007.357
293.
Finally, Crystallex contends that the so-called Equator Principles are not relevant to the resolution of this dispute. These principles are, according to the Claimant, an "adaptive environmental and social risk-based guidance framework, used by financial institutions to make lending decisions on project financing".358 The Claimant notes that between 2004 and 2008, when Crystallex's EIS was under review by the Ministry of Environment, Crystallex was not actively engaged in submitting a proposal for project finance to an international lender.359
294.
Furthermore, the Equator Principles are not part of Venezuelan law, and, thus, it is not surprising that the guidelines are not referred to in any of Venezuela's internal documents relating to the EIS or in any of Venezuelan's communications with Crystallex. Consequently, when it comes to judging whether the actions of the Ministry of Environment in denying the Permit were justified at the time the decision was made, the Equator Principles have no relevance.360
295.
In any event, the project was, in the Claimant's view, fully compliant with the Equator Principles, and would therefore have qualified for project financing had Crystallex sought to apply for such financing.361

h. After the Permit Denial, Crystallex's due process rights were ignored

296.
According to the Claimant, the fact that the Permit denial letter lacked all of the data, figures, supporting documents and other attributes it was legally required to have pursuant to Venezuelan law, deprived the Claimant of its due process right, because it prevented it from making its case once it chose to challenge the decision.362
297.
In addition, Crystallex's rights of due process were denied when it sought to challenge the Permit denial.363 First, when it launched the recourse for reconsideration, it was denied the right to respond because it was told by the Director-General of the Administrative Office of Permissions at the Ministry of Environment that it had no standing because it was purportedly not domiciled in Venezuela, something which the Claimant contends is transparently false.364
298.
Second, when Crystallex mounted a hierarchical appeal against the Ministry's refusal to recognize its standing, Venezuela violated Crystallex's due process rights again through its failure to respond to the hierarchical appeal.365

i. The inconsistent statements and reassurances by Venezuelan authorities following the Permit denial

299.
Following the Permit denial, Crystallex claims that Venezuela subjected it to a "rollercoaster of political mistreatment" that eventually culminated in the rescission of the MOC in February 2011.366 While Crystallex was given assurances in private about the permitting process, other Government officials, including President Chávez himself, made inconsistent announcements that Las Cristinas would be "taken back" and developed by the State or with a partner of a different nationality.367
300.
On the one hand, Crystallex contends that the Ministry of Environment reopened the permitting decision shortly after the Permit denial.368 For example, on 20 August 2008, Vice-Minister Merly Garcia wrote to Crystallex, giving the appearance that the Ministry was still deciding whether to issue the Permit, and stated that:

"[H]aving fully studied [Crystallex's proposal], which tends to adhere to Government guidelines in both environmental and social matters, this Office considers that it is viable for our technicians to evaluate same with a view to the decision the Ministry must take on the Las Cristinas Gold Project".369

301.
Crystallex claims that Venezuela also continued to confirm that the conditions for the Permit were fulfilled. For example, senior representatives of the Ministry of Mines appeared at a hearing before the Permanent Committee for Economic Development of the National Assembly in June 2008, confirming that Crystallex was in compliance with the procedural and administrative requirements necessary to receive the Permit.370 The Permanent Committee's post-hearing report noted that prior to the Permit's denial, Crystallex had received longstanding support from the Venezuelan Government.371
302.
On the other hand, Venezuelan Government officials publicly announced their intention to take back the value of the right to mine Las Cristinas.372 The position of the Claimants as to the key developments in these respect is summarized in the following paragraphs.

i. July 2008-October 2010: Key events and announcements

303.
In 2008, President Chávez and President Putin decided to create a joint venture, called VenRus, to develop gold mines in the Imataca Reserve. The joint venture agreement, signed by Minister of Mines Rodolfo Sanz and a Russian-managed company, Rusoro, was signed in July 2008.373 VenRus was then incorporated on 29 September 2008.374
304.
In September 2008, President Chávez publicly announced that:

"In Guayana for example, we are taking back big mines, and one of them is one of the biggest in the world. And do you know what it is? It's gold, it's gold!"375

305.
For the Claimant, given the unique nature of the mine, it is self-evident that President Chávez could only have been referring to Las Cristinas.376
306.
On 5 November 2008, Minister Sanz announced, in an official press release, that the Government would take back Las Cristinas from Crystallex:

"[T]he Las Cristinas mine, which used to be managed by transnational company Crystallex, is expected to begin being exploited in 2009. […] [T]he mine will be reclaimed and operated by the State. […] As a result of the financial crisis spreading worldwide, we must try to recover our gold in order to increase our international reserves".377

307.
Crystallex points out that the press release did not refer to any of the concerns which had been mentioned in the Permit denial letter.378
308.
On 6 November 2008, at a presentation to a Russian Government delegation which press agency Reuters attended, Minister Sanz explained that the Government would enter into an agreement with Rusoro to operate both the Las Cristinas and Las Brisas project in an effort to develop closer ties with Russia and increase mining input in light of tumbling crude prices. According to the Reuters press release, Minister Sanz stated that:

"We have to rescind our relationship with a company that has been working in the zone. […] We have a legal problem there. […] the memorandum would not mention Las Cristinas and Brisas by name for legal reasons. […] ‘You can be sure that those will be the deposits', he told the delegation".379

309.
Thereafter, Crystallex claims to have held a positive meeting with Adan Chávez, the brother of President Hugo Chávez, about a possible joint venture between Crystallex and the Venezuelan Government.380
310.
However, in his annual address to the Venezuelan people before the National Assembly in January 2009, President Chávez stated that:

"[T]his year the Venezuelan State has taken over the exploitation and control of the gold deposits of Las Cristinas. [...] [W]e have created this year (2008) the mixed company Venrús, with Russia, [...] a mixed company for the deposits of Las Cristinas".381

311.
Again, Crystallex contends, no mention was made of environmental concerns relating to mining in the Imataca Forest Reserve, global warming or any of the other issues raised in the Permit denial letter.382
312.
However, on 22 January 2009, Reuters reported the following statement by Minister Sanz:

"When asked whether Crystallex would leave the project, after having waited years for environmental permits to develop it, the Minster stated that ‘I did not say that'. ‘When we have made a decision we will communicate it to whomever it must be communicated' he added".383

313.
On 2 March 2009, Crystallex received yet further assurances from the CVG that the MOC remained in full force and effect, that it had fully complied with its obligations and that the project was in the process of obtaining the required permits:

"Taking into account that […] Crystallex has been fulfilling the obligations assumed under the contract, we hereby inform you that the contract is fully valid and in the process of obtaining the required permits from the competent authorities for the initiation of the development of the Project".384

314.
In April 2010, during his weekly talk show "Aló Presidente", President Chávez stated:

"If we are going to exploit gold we will have to nationalize all of it, recuperate and put an end to concessions which led to degeneration".385

315.
In May 2010, Crystallex claims that it sought to partner with an entity of a nationality that would be acceptable to the Government in order to move forward with the Las Cristinas project. It thus engaged in talks with China Rail, a Chinese State company.386
316.
In August 2010, the CVG confirmed again that Crystallex's MOC was in full force and effect and requested further information from Crystallex regarding the proposed association with China Rail.387
317.
However, in October 2010, President Chávez travelled to Belarus accompanied by Minister of Mines José Khan. The President of Venezuela announced that:

"Las Cristinas, this mine belongs to Venezuela and it has been handed over to transnational companies. I announce to the world that the revolutionary Government recuperated it, together with the Las Brisas mine. These mineral resources are for the Venezuelan people, not for transnationals […] ".388

ii. The controversial "VenRus Presentation" of late 2010: Exhibit C-439

318.
According to the Claimant, in late 2010, around the time of the President's trip to Belarus, a presentation surfaced titled "Project Proposal ‘Brisas de Las Cristinas'".389 The presentation's cover page bears the official logos of the Ministry of Mines, the State Mining company "Minera Nacional" and VenRus (the Venezuelan joint-venture with Rusoro), as well as the logo of Venezuela's "bicentenary of independence". In response to the suggestion by Venezuela and some of its witnesses that the powerpoint presentation may have been prepared by Rusoro, the Claimant points out that Rusoro's logo does not appear anywhere in the presentation.390
319.
The Claimant contends that the presentation set forth a legal strategy for "getting rid" of Crystallex without paying any compensation, so that Las Cristinas and the neighbouring Las Brisas mines could be jointly developed by VenRus and Minera.391 Amongst other things, the presentation took aim at Crystallex being a "foreign enterprise" domiciled in British Columbia.392 It set forth two alternative legal strategies for rescinding its commitment to Crystallex without compensation, one of which involved rescinding the MOC pursuant to Clause 24 of the MOC.393 According to the Claimant, the presentation "provided a recipe for dressing up a sovereign act of expropriation as a mere contractual act".394
320.
The Claimant highlights that, at the hearing, both Ms. Paredes (the President of VenRus at the time) and Minister Khan (the Minister of Mines at the time) admit to having reviewed the presentation in 2010, although they both strongly denied any involvement by either the Ministry or VenRus in the preparation of the presentation.395 Paredes suggested that the presentation was prepared by Rusoro.396
321.
the Claimant, this evidence is not credible, because it is implausible that Ms. Paredes and Minister Khan would have tolerated a private company's use of official Government logos; that Rusoro, a Canadian company domiciled in British Columbia, would cast aspersion on another mining company because of its domicile in British Columbia; and because Rusoro was not in a position to make a presentation concerning the interests of the Government of Venezuela, or to opine on Venezuela's policy and sovereignty as to national resources, as the presentation does at length.397
322.
For the Claimant, the presentation is a document prepared by the Venezuelan Government, with the approval of the Ministry of Mines, reflecting the policies of the Venezuelan Government.398 It provides a plan to expropriate Crystallex's rights in order to transfer them to the VenRus joint venture, disguised as a contractual matter to seek to avoid compensation and thus "reduce the risk of claims on [the] part of Crystallex brought either before the national courts or international tribunals".399
323.
The Claimant notes that in February 2011 Venezuela precisely implemented the Ministry of Mines'/VenRus' legal strategy suggested in the VenRus Presentation, when it rescinded the MOC invoking Clause 24 of the MOC.400

2. The Respondent's Position

324.
The Respondent contends that the Ministry of Environment properly and justifiably denied Crystallex's request for an environmental Permit in 2008 after a thorough, technical review of all the information submitted. According to Venezuela, the denial was based on several well-founded concerns about the proposed project's likely unmitigated environmental and socio-cultural impacts, which had been raised and discussed with Crystallex since 2004. During the four-year environmental review process, Crystallex failed to adequately assess or address these concerns and failed to convince the Ministry that the project's impacts would be sufficiently mitigated, corrected and/or prevented.
325.
According to Venezuela, during the four years in which the environmental analysis and Permit application remained pending, the Ministry of Environment was responsive to Crystallex. The Ministry did not delay in its answers, rather, it considered each submission by Crystallex, analyzing whether the Claimant was responsive to the concerns raised by its technical experts; and generally worked with the CVG and Crystallex to achieve an impact assessment and mitigation program that would be acceptable, yet to no avail.401
326.
Venezuela submits that the Ministry's review of Crystallex's application was a purely technical and apolitical process in which the Permitting Office at the Ministry solicited input, comments, and recommendations from technicians in numerous departments including experts in water resources, forestry, biodiversity, community impacts, and environmental mitigation and monitoring.402

a. The Deficiencies in the Claimant's EIS were repeatedly raised with the Claimant since 2004

327.
Venezuela contends that, when Crystallex submitted its EIS on 15 April 2004, it requested an initial permit for "preliminary work construction activities for the proposed project" to be followed by another permit for its exploitation activities (i.). At the end of 2004, the Ministry informed Crystallex of substantial deficiencies in its materials that would need to be corrected before any permits would be issued (i.-ii.). Throughout the next 18 months, the Ministry held roundtable discussions with the company, considered the company's responses, and had its own technicians evaluate different aspects of the proposal (ii.-iii.). By mid-2006, the Ministry notified Crystallex of its conclusion that Las Cristinas had to be evaluated jointly with the adjacent Las Brisas project in order to decrease the cumulative negative impacts on the environment of the two neighboring projects (iv.). Crystallex did not deliver the requested additional information and integrated analysis, and, as a result, the Ministry concluded that it had to deny the requested permits (v.).
328.
According to the Respondent, many contemporaneous documents show that the relevant subdivisions of the Ministry of Environment reviewing Crystallex's EIS identified numerous, significant deficiencies, which were inadequately addressed by the company.403 Thus, by no means could the Permit denial come as "a surprise" to Crystallex.404
329.
The next sections analyze in greater detail the Respondent's position on the main exchanges between Crystallex, the CVG and the Venezuelan authorities, in particular the Ministry of Environment, on the environmental aspects of the project.

i. 2004: From Crystallex's submission of the EIS, up to the Ministry's rejection on 29 December 2004

330.
As a preliminary matter, the Respondent highlights that when Crystallex submitted its EIS on 15 April 2004, it requested an initial permit for "construction activities for the preliminary works of the project",405 to be followed by another permit for its exploitation activities. For the Respondent, there is no evidence to support Crystallex's claim in the arbitration that "this request for a preliminary permit was abandoned by CVG/Crystallex in late 2004".406
331.
Moreover, acceptance of the Placer Dome EIS was irrelevant to the environmental review of Crystallex's plan.407 For Venezuela, minimal changes to an existing project continued by the same operator will require less analysis than a new project by a new operator based on new information many years after the original approval was sought. The latter is the case here, as the Placer Dome/MINCA EIS had been prepared in 1997.408 Thus, in 2004, Crystallex could not rely on an old approval of an outdated study for its new proposal to build a complex, large open-pit mine.409
332.
Furthermore, according to Venezuela, substantial concerns led the Ministry of Environment to reject Crystallex's permit request in late 2004.
333.
As early as 31 May 2004, the Ministry of Environment set out its first set of technical observations to Crystallex's proposed EIS.410 The Ministry raised concerns regarding water issues, the diversion channel, the lack of proper forestry inventory, the problem of illegal miners, and social issues more generally. Venezuela submits that every single one of these critiques also appears in the April 2008 Permit denial.411
334.
Similar concerns were raised by the Ministry of Environment in a meeting with Crystallex that took place on 23 September 2004.412 The Ministry's questions and concerns prompted, according to Venezuela, the preparation of Addendum 2 of the EIS.413
335.
On 29 December 2004, the Ministry of Environment communicated its rejection of the EIS documentation that Crystallex had submitted up to that point.414 The Ministry asked for a reformulation of the project (and not just of its terms of reference, as argued by the Claimant) in order to minimize environmental impacts, highlighting various concerns regarding the proposed project and the inadequacy of Crystallex's EIS.415
336.
The Ministry pointed at Crystallex's insufficient or entirely lacking data. It noted that Crystallex had failed to adequately identify the flora and fauna present in the area; that the proposal lacked the necessary mitigating preventive, or corrective measures related to the tailings pond, water diversion channel, landfill, and incinerator; that Crystallex had only assessed the impact of the proposed tailings pond "with respect to the area's deforestation process, yet never examining the interaction of this pond with the surrounding environment"; and that Crystallex had not adequately addressed the social impacts of its plans on illegal and small-scale miners nor planned to include them in the area of its operations.416

ii. 2005: Key developments

337.
The Respondent submits that during 2005, the Ministry provided substantial feedback to Crystallex by holding workshops with company representatives to discuss different concerns about the EIS through the year.417
338.
In the framework of these workshops, the Ministry of Environment reiterated its concerns regarding certain aspects of the Las Cristinas project and its possible environmental and social impacts.418 These meetings, according to Venezuela, were necessary because the Ministry was not satisfied with the responses and addenda it had received in 2004 from Crystallex.419 In these interactions with the Claimant, the Ministry requested several additional items from the company, including the Social Investment Plan; the Manual for the Application of Natural Physical Measures; updated baseline studies for air, flora/fauna, and soils; and a forest report and reforestation plan.420 For the Respondent, the issues raised in 2005 precisely foreshadow the reasons for the Permit denial in the 2008 letter.421
339.
For example, at a roundtable discussion on 18 April 2005, the parties agreed to set up three technical commissions to follow-up on specific aspects:422 (i) environmental quality;423 (ii) socio-cultural aspects;424 and (iii) water, biodiversity, and forestry.425

iii. 2006: The Technical Inspection Report (Exhibit R-52)

340.
During 2006, according to the Respondent, personnel from the Ministry visited the site, reiterated the same concerns discussed above, and went so far as to internally recommend the denial of the Permit.
341.
In particular, in July 2006, the Permissions Office of the Ministry of Environment prepared a summary on the review process, highlighting that there was no clear solution to the social problems concerning the small-scale illegal miners, nor a clear definition regarding the inclusion of indigenous communities in the project.426
342.
In September 2006, Pedro Romero and other experts from the Ministry of Environment visited the Las Cristinas site and prepared a report summarizing their findings (the "Technical Inspection Report", Exhibit R-52). This report raised the concerns that were later echoed in the April 2008 Permit denial. The report recommended that the Ministry's Permissions Office should deny the Permit requested for Crystallex's proposed project.427
343.
According to the Respondent, the Technical Inspection Report was prepared with the collaboration of a multidisciplinary technical team.428 The Respondent highlights that the report provided several reasons for its conclusions that the proposed project should not be permitted. These included the issues related to small miners, deforestation, changes to surface and subterranean water, the delicate nature of the Imataca Forest Reserve, and social issues related to the introduction of thousands of new workers to the area.429 It also discussed concerns about water,430 issues relating to the exploitation of copper,431 and plans to mitigate acid rock drainage.432

iv. 2006 (cont'd): The Ministry's concerns with regard to the cumulative impacts of Las Cristinas and Las Brisas (Gold Reserve)

344.
According to the Respondent, the second half of 2006 was dedicated to discussions between not only Crystallex and the Ministry, but also Gold Reserve, regarding the cumulative impacts of the Las Cristinas and Las Brisas projects and the need for cooperation between the companies to minimize and mitigate unacceptable environmental and social impacts.433
345.
On 31 July 2006, the Ministry of Environment notified Crystallex and Gold Reserve of the need to conduct a Strategic Environmental Evaluation (or "EAE" by its Spanish initials).434 An EAE is a planning tool prepared by the Venezuelan State, which however requires certain joint analysis and evaluation by the affected project developers.435 Venezuela explains that the Ministry of Environment considered it necessary to carefully analyze the cumulative impacts of both the Las Cristinas and Las Brisas projects and to conduct a Strategic Environmental Evaluation before either project could be fully permitted.436
346.
On 17-18 October 2006, the Ministry of Environment coordinated two days of meetings with Crystallex, the CVG, Gold Reserve, their consultants, and the Embassy of Canada as part of a "Venezuelan-Canadian Business Forum" held in Porlamar, Venezuela (the "Porlamar meeting").437 In this context, the Ministry emphasized that while it would consider the requests for permits independently, the environmental authorizations for both projects were counting upon a coordinated effort to minimize environmental and social impacts.438
347.
On 19 December 2006, the Ministry of Environment sent essentially the same letter to both Crystallex and Gold Reserve, indicating its concerns regarding the significant likely impacts of the two projects, outlining certain requirements of the EAE, and calling for a meeting to take place on 22 December 2006.439
348.
In the 22 December 2006 meeting with the two mining companies, according to Venezuela, the Ministry of Environment committed to a phased permit approach: (1) a "priority permitting process" in which it would issue preliminary Permits for both the Las Cristinas and Las Brisas projects within three months, if its requirements were satisfied by the project proponents; and (2) a "medium-term" schedule in which authorization for at least some of the other elements of both projects (i.e., everything not listed in the "short-term" category) might be expected in "approximately 3 years".440 In other words, Venezuela contends that the Ministry promised a partial permit in three months, but required significant information for further analysis of Crystallex's plans and the likely impacts before it would grant an exploitation permit to Crystallex.441 According to the minutes, the Ministry demanded, inter alia, a joint hydrological evaluation for Las Cristinas and Las Brisas, as well as a joint analysis of the socio-cultural impacts of the two projects, a "joint social investment plan" (one part of which was to focus on indigenous peoples), a comprehensive Environmental Supervision Plan, and supplemental information on Crystallex's plans regarding the use of copper.442

v. 2007: Crystallex's inadequate feedback to the 22 December 2006 meeting requests

349.
Venezuela submits that the materials that Crystallex submitted in early 2007 in response to the concerns raised in the 22 December 2006 meeting either completely ignored or inadequately addressed the Ministry's requests.443 The Respondent makes the following observations:
350.
With regard to the joint hydrology report, which the Ministry had requested Crystallex and Gold Reserve to submit, Crystallex's report submitted on 16 February 2007 contained no joint evaluation or analysis.444