Sanctioned Alrosa Buys a Gold Mine

Sanctioned Russian diamond miner Alrosa has concluded the purchase of a gold mine in the far east of the country and will invest $276m developing it.

The move comes seven months after the G7 and EU countries introduced the first phase of restrictions on the import of Russian diamonds.

Alrosa’s subsidiary, Almazy Anabara company, has bought 100 per cent of the Degdekan gold ore field in the Magadan region, according to a report by Russia’s Interfax news agency, from Polyus the country’s largest gold producer (also sanctioned).

Alrosa, the state-run miner, already has some gold mining operations, with an output of around 180kg annually.

But this marks a significant expansion, with the projected production of 3.3 tons from 2030.

In 2015 Russia’s State Reserves Commission said the deposit had reserves of 38.3 tonnes of gold.

“The development of the gold deposit will provide an additional synergistic effect for Alrosa’s business and will help increase its financial stability in the long term,” Alrosa CEO Pavel Marinychev said in a statement.

Alrosa sold $4bn of diamonds globally in 2022. The G7 nations, which are now blacklisting its diamonds, account for 70 per cent of diamond purchases worldwide.

Source: IDEX