Source Pravda.Ru

Russian Government Sets Export Quota for ALROSA Diamond Producer

Russian Prime Minister Mikhail Kasyanov has signed an order on a 5-year diamond export quota for diamond producer ALROSA. The long-term export quota will allow the company to develop production capacity at its mining facilities.

The company received a 5-year export quota for the first time in its history in accordance with a decree signed by the President in November 2002. The degree allows long-term quotas to be issued for exporting unrefined diamonds. From now on, the Ministry for Economic Development and Trade will each year give ALROSA an export license in accordance with the volume set out in the quota.

According to ALROSA president Yuri Dudenkov, 'the quota order guarantees stability and will help to increase investment in our production facilities and attract low-interest long-term loans from foreign banks. The previous practice of issuing quotas with hold-ups of two, three or even more months meant that the company's income from selling diamonds was 50-60% lower than planned.'

ALROSA was established in 1992. The company produces almost 99% of all Russian diamonds and about 20% of the world's. According to estimates by geologists, the company's reserves will last for 50 years at present rates of production. ALROSA earned 55.4 billion roubles (USD 1.76 billion) in 2001, with a net profit of 9 billion roubles (USD 286 million). The company estimates that its income for 2002 was about 56-57 billion roubles (USD 1.79 billion). The Russian Property Ministry owns 37% of ALROSA, with the government of Yakutia owning a further 32%, eight Yakutian districts owning 8%, and 23% belonging to the company's workers.

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