ALROSA builds up investments into exploration

At the meeting held by the Executive Board of ALROSA and chaired by the company’s President Fyodor Andreev in Mirny this Friday its participants discussed the progress of the exploration program to be implemented until 2018 and performance of the exploration team in 2011. The diamond miner spent about 4 billion rubles on exploration and prospecting works in 2011 and earmarked over 5.358 billion rubles to be invested for this purpose in 2012. This was stated in ALROSA’s press release received by Rough&Polished.
The company increased its reserves of rough diamonds by about 30 million carats in 2011 driving its P1 predicted resources to about 47 million carats mainly due to exploration performed on the Nyurbinskaya placer diamond field and in the upper layers of the Zarya Diamond Pipe. During the reporting period ALROSA obtained licenses for exploration and mining within five new diamond fields (Verkhne-Munskoye, Dalnyaya, Maiskaya, Ebelyakh and Gusinaya), made up projects for further exploration activities and commenced their implementation.
In November 2011, the company received a state certificate confirming the discovery of a new diamond field, the Zarya Diamond Pipe.
The Board also discussed the reform of the aviation facilities run by ALROSA.
The key objective of reforming the Mirny Airline is to provide for year-round transportation reach within Western Yakutia, thus connecting the City of Mirny with the nearest regional centers (such as Yakutsk, Irkutsk, Novosibirsk, Khabarovsk, and Krasnoyarsk) and central regions of Russia and the country’s resorts, as well as to meet domestic needs of the company (aerial survey, cargo traffic, supplies to expeditions, etc.). In addition, within this reform the company intends to renew its aviation park adding modern and efficient aircraft with a focus on unconditional flying safety.
The Board considered it expedient to establish a separate subsidiary, which will concentrate on ALROSA’s flight activities, as well as to prepare the necessary documents to be considered by the Supervisory Board for a possible free transfer of the company’s airport facilities into federal property. In addition, ALROSA will develop its proposals for renewal of its aircraft fleet.
The Board approved the program of measures to optimize the structure of ALROSA’s subsidiaries and affiliates up to 2021. The company plans a significant reduction in the number of subsidiaries and affiliates by 2021. ALROSA intends to retain only those subsidiaries which are directly engaged in its core business, assisting in marketing policies and social functions.
The Board considered the company's development strategy for ZAO Geotransgaz and OOO Urengoyskaya Gazovaya Kompania within the existing obligations of ALROSA to buy back the assets from the VTB Group. The Board has approved plans to develop the three gas and gas-condensate fields - Beregovoye, Ust-Yamsoveyskoye and Urengoyskoye - in the north-eastern part of the Purovski District located in the Yamalo-Nenets Autonomous Area in team with OAO Zarubezhneft. The licenses for these areas are owned by ZAO Geotransgaz and OOO Urengoyskaya Gazovaya Kompania. To enter the project, Zarubezhneft intends to acquire blocking stakes in the companies holding these licenses from ALROSA. Fyodor Andreev, President of ALROSA, and  Nicholay Brunich, General Manager of  Zarubezhneft, signed an appropriate agreement of intent.
In addition, the Board considered the issue of reforming ALROSA’s diamond cutting operations, approved the list of candidates to be nominated and elected to the management and control bodies of the diamond miner’s subsidiaries and affiliates in 2012, as well as amendments to a number of regulatory documents of ALROSA.