Russian, Angolan diamond groups sign MoU

Russia’s predominantly State-owned global diamond mining major, Alrosa, and Angola’s State-owned national diamond mining company, Endiama, signed a memorandum of understanding (MoU) early this month.This marks the latest stage in the development of the relationship between the two entities, which have been cooperating for more than 25 years. They are the cofounders and main shareholders (with 41% each) in Angola’s largest diamond mining company, Catoca. (Catoca has estimated reserves of 120-million carats, and mines and sells about 6.8-million carats of diamonds a year.) Also, since 2014, they have been jointly exploring for diamonds in Angola.

“For both Russia and Angola, the diamond industry is an important part of national life,” observed Alrosa CEO Sergey Ivanov. “This is not only about the place in the international arena or funding the budgets, but also jobs for people and dozens of social projects implemented for them. Of course, we are pleased to seal our long-term cooperation with an official document proclaiming the joint desire to develop our common initiatives.”

The intent of the MoU is to reinforce the economic, technological and scientific cooperation between the two groups. The two companies have agreed to undertake joint projects in research and seeking geological and mining facilities. They will also exchange technologies and knowledge regarding mining and other operations, and Alrosa will train Angolan specialists at its facilities.

Further, they have identified areas of mutual interest regarding the development of Angola’s diamond production. This will follow the requirements of best corporate social responsibility practice, transparency and sustainable development. The focus will be on locating and exploring new deposits that are economically attractive. They will also work together regarding diamond sales mechanisms.

In addition, Alrosa and Endiama plan to cooperate to help develop the global diamond sector’s self-regulatory systems, as well as to strengthen responsible, Kimberley Process-compliant diamond supply chains. The aim is to promote diamonds and related products in major markets, thereby assuring the sustainable development of the Russian and Angolan diamond industries.

Other important goals concern financing and marketing. The two groups will seek to finance current and future joint projects using project financing principles. They will also promote, in the words of Alrosa’s press release, “integrated delineation of international markets for rough and polished diamonds (both natural and synthetic) to protect fair competition and interests of diamond mining countries”.

The MoU was signed on April 4by Ivanov and Endiama Administrative Council chairperson José Ganga Junior. The signing was witnessed by Russian President Vladimir Putin and Angolan President João Lourenço. The day before, Lourenço, who was on an official visit to Russia, visited Alrosa’s Unified Selling Organisation, which is responsible for the sorting of the Russian group’s rough diamonds, their pre-sales preparation and their sale. Various stages of the diamond sorting process were demonstrated to the Angolan President, and Alrosa repeated its willingness to share its diamond sorting expertise with Angola.