On March 27, 2026, the US Treasury's OFAC lifted sanctions on Venezuela's minerals sector, comprising bauxite, coltan, gold, diamonds, and other rare earths, enabling US firms to pursue contracts, also with state-owned Minerven, post the capture of Nicolás Maduro. At present, the nation is eyeing to strengthen ties with the interim leader Delcy Rodríguez to have better access to the Venezuelan critical mineral industry, bauxite in particular, for extracting gallium and scandium. 

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The Venezuelan bauxite scenario

Venezuela holds substantial bauxite resources, estimated at 3.48 billion tonnes, with a reserve of 1.33 billion tonnes and a resource base of 2.15 billion tonnes. This is largely concentrated at the Los Pijiguaos mine of Bolívar in the Guayana region, which has a capacity of almost 5.2 million tonnes per year but has remained idle since 2019 due to power outages, operational issues and import restrictions.

The Bolívar and Amazonas states in Venezuela hold substantial bauxite reserves, primarily concentrated within the Orinoco Mining Arc (Arco Minero del Orinoco), a 111,843 square kilometre zone, accounting for 12.2 per cent (approx.) of Venezuelan territory. Established in 2016, it was designed to promote mineral extraction. However, there has been a sharp production decline in recent years.  

The Bauxilum mining and refining complex has a nameplate capacity of 6 million tonnes of bauxite, but the actual bauxite output has dropped below 1 million tonnes per year. Most of this production now caters solely to domestic refining rather than export markets.  

US enters the scene

Focus on the Orinoco Arc aligns with the US critical minerals push. Bauxite is a strategic resource for the US defence sector, not only for aluminium but also as a source of rare earth elements such as gallium and scandium, recovered from refinery by-products like red mud.

Through initiatives backed by the US Department of Defense, includingElementUSA’s Gramercy, Louisiana facility’s USD 29.9 million DPA award in November 2025, these minerals are being extracted from more than 30 million tonnes of bauxite residue. Without the need for fresh mining, they are being used for supporting applications in missile defence systems, fighter aircraft, hypersonic technologies and advanced alloys.

In defence areas, gallium contributes to advancing high-power and high-frequency electronics. It helps in building lighter, smaller and more durable components for radar systems such as the Active Electronically Scanned Array (AESA), missile guidance, electronic defence operations etc. Fighter jets like F-35 have gallium on their body structure. 

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Similarly, a critical rare earth mineral, scandium, is extensively used in defence, mainly as an alloy additive to aluminium for the enhancement of strength, performance and corrosion resistance. It is used in fighter jets such as the MiG-29, missiles and military vehicles.  

“By enabling ElementUSA to recover gallium and scandium from processing waste, this award will support the DoD’s work to expand the supply of critical minerals needed for numerous defence components and platforms,” said Jeffrey Frankston, Acting Deputy Assistant Secretary of Defense for Industrial Base Resilience.

He added, “Such awards are essential for rebuilding domestic capabilities … and strengthening national security.”

Moreover, Assistant Secretary of War for Industrial Base Policy, Mike Cadenazzi, mentioned, “Gallium and scandium are vital to a wide range of defence manufacturing applications. Expanding domestic production of these minerals remains a key priority.”

Relevance in the present situation

With the ongoing geopolitical conflict in the Middle East between the US-Israel and Iran, rattling the entire world and tumbling the global markets, the US can greatly benefit from the Venezuelan bauxite reserves to extract gallium and scandium and apply that to its defence industry to keep the defence storage well replenished for the upcoming times in the international tensions. 

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