First vice-president of Alrosa company Alexander Nichiporuk is interviewed at the news conference summoned to announce the Alrosa 2003 results
Photo: Vassily Shaposhnikov
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ALROSA Becomes African Exporter
// Diamond market
Yesterday, ALROSA announced that for the first time in 13 years of its work in Angola it received a right to sell local diamonds. ALROSA vice president Dmitry Novikov said that the first lot of Angola diamonds worth $22 million will be sold at the open auction in Antverpen. The new scheme of diamond sales, set in effect from the beginning of this year by Angola authorities made ALROSA a valid player on the African diamond market.
ALROSA owns 32.8 percent of GRO Katoka, founded in 1992, which develops the namesake kimberlite pipe. Other founders of Katoka include Angola state company Endiama (32.8 percent), Israel’s Daumonty Financing (18 percent) and Brazilian Odebrecht Mining (16.4 percent). ALROSA also carries out geological survey at Kamacha and Kamajiku diamnond veins at the Luo field. ALROSA subsidiary Escom-Alrosa Ltd. owns 45 percent stock of the Luo-GRO Kamacha-Kamajiku Ltd., founded in 2002. Besides that, the Russian diamond monopolist is building a hydroelectric power plant on Shikapa river.
Yesterday, ALROSA vice president Dmitry Novikov said at the press conference, that the first lot of diamonds worth $22 million was sent from Angola to the Arcos Belgium, Antverpen, ALROSA affiliate. “Negotiations with Angola authorities took us a year. As result, ALROSA was able to purchase from state monopolist Sodiam all diamonds mined the previous month at Katoka. So now we will be able to realize Angolan diamonds at the free market independently,” he said, adding also that the diamonds will be sorted in Antverpen, and will be sold at an open tender at the end of April.
ALROSA, which has been working in Angola for 13 years, did not have the right to realize local diamonds at the foreign market before now. Angola has a state monopoly for their export, which is carried out by Sodiam (100 percent owned by Endiama, which represents the interests of the state in all diamond companies). Sodiam signed contracts with authorized exporters, ALROSA never being among them. Practically all diamond mining has been controlled by Israeli diamantaire Lev Levaev. Ascorp company, controlled by Levaev evaluated Angolan diamonds and exported them on exclusive conditions. As result, GRO Katoka had to sell its diamonds by rates, much lower than the market’s. It looks like now the situation is finally changing.
ALROSA speaks of the upcoming auction in Antverpen as a real breakthrough. “It’s not so much that we were able to crowd out Levaev’s company. We will finally know how much Katoka’s diamonds are worth,” Novikov states. According to him, from the moment of the new scheme of diamond sale going into effect, Katoka was able to raise its prices by 15 percent. All those facts make Angolan projects attractive for investors. For instance, Austria’s Donau-Bank, whose 85 percent is owned by Vneshtorgbank, has already expressed interest to finance the shipping of Angolan diamonds to Europe. Vneshtorgbank itself finances the construction of the power plant on Shikapa River. A delegation of bankers returned in the beginning of this week from visiting Angola on ALROSA’s invitation. Besides Vneshtorgbank and Donau Bank, Moscow Narodny Bank, JP Morgan, ABN-Amro, and Natexis Banques Populaires also visited Angola.
However, ALROSA’s top managers say there have been no talks regarding attraction of investors. “Last week we registered an information memorandum on placing Euro commercial securities at the Luxemburg stock exchange. This will allow ALROSA to attract short-term financing up to $300 million during the year,” head of ALROSA treasury Igor Kulichik said.
Kommersant will be following the events.
Elena Kiseleva
All the Article in Russian as of Mar. 25, 2005
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