Alrosa ups February sales, reports on exploration developments

JOHANNESBURG (miningweekly.com) – Russian diamond major Alrosa on Wednesday announced its latest diamond sales results and also reported on geological prospecting developments, including the reorganisation of its exploration unit.

The company, which produces the world’s most diamonds in terms of volume, said that it had sold $541.9-million worth of rough and polished diamonds in February. This compares with $504.5-million in January.

Rough diamond sales by value amounted to $532.8-million and polished diamond sales to $9.1-million.

"In February, the core diamond markets were quite strong. The diamond cutting sector continues replenishing the stock. Demand for diamond products was also backed up by good jewellery sales in China on the eve of the Chinese New Year. Prices for diamonds in most size categories grew in January and February," deputy CEO Yury Okoemov commented in a statement.

Meanwhile, Alrosa reported that it had grown its rough diamond reserves to almost 1.2-billion carats in 2017 and said that it had reorganised its exploration unit.

In a separate media statement dealing with geological prospecting activities of 2017, the miner said that total diamond reserves, taking into account the explored deposits under the National Reserves Committee standards, had increased by 57.8-million carats during the year (excluding the depletion of reserves) to 1.18-billion carats.

Alrosa spent about RUB8-billion on prospecting and onsite exploration last year, with its focus on the Republic of Sakha (Yakutia), in the Arkhangelsk region, and Angola.

In Russia, prospecting operations were focused on eight most promising areas, seven of which are located in Yakutia. In particular, Alrosa conducted the search for diamondiferous kimberlites in southern areas of Western Yakutia, prospecting and evaluation works on Syuldyukarskaya pipe and on alluvial deposits in the Srednemarkhinsky and Malobotuobinsky areas.

Alrosa also reported that it had implemented the first stage of its exploration complex reform, with three specialised competence centers – exploration, mining and drilling, scientific and analytical – having been formed at four exploration subdivisions.

The changes are aimed at eliminating the duplication of administrative and management functions, as well as to strengthen the role of the chief geologist of the group, the company explained.

Alrosa has also completed an audit of exploration projects and has stopped work on projects in low potential territories, while it accelerated work in promising areas.

"The reform of the exploration complex should help to optimise and increase its efficiency, eliminate duplicate functions, improve management efficiency, and reduce the costs. According to our estimates, the cumulative effect of these changes will exceed RUB300-million a year, while maintaining the pace of exploration operations. Whereas the strategic goal of exploration - effective replenishment and improvement of the quality of the mineral resources base - remains constant," says the chief geologist Konstantin Garanin.