A Venezuelan state company is looking for new investors in one of Latin America's largest gold deposits, after revoking an exploration license for Las Cristinas in the south-east of the country.

Canadian mining group Placer Dome was awarded the rights to develop the mine 11 years ago.

The Venezuelan government had hoped it would generate billions of dollars for the economy and hundreds of jobs.

But ten years later the site had still not started commercial production and Corporaci�n Venezolana de Guayana (CVG), the state-owned conglomerate and partner in the project, has made it clear that it does not want the Canadian firm there.

Court cases

A court case with another company over exploration rights for the site and disputes between Placer and CVG had held up the project.

In 1999, by which time gold prices had slipped from $400 per ounce when the project started to $275, Placer pulled out claiming it was no longer economical.

It sold its stake for $50 to a small Canadian mining company Vannessa Ventures, who planned a much smaller mine, with Placer retaining the option of resuming involvement if gold prices picked up.

Manfred Peschke, the president of Vannessa Ventures, told the BBC's World Business Report that CVG had the chance to buy the licence out, but had not acted.

"We have a legal commercial contract," he said adding they would not give up their claim.

Legal wrangling

CVG has filled criminal charges against Placer for allegedly defrauding it by selling the licence to Vannessa and the National Guard seized the property last November.

The Venezuelan company claims Vannessa does not have the resources to develop the mine and rejected the scaled-back mine proposal.

Vannessa has counter-sued CVG, accusing it of theft and abuse of authority.

Undeterred, CVG is seeking partners and has had some expressions of interest for the site with proven gold reserves of 11.8 million ounces worth about $3.4bn.