Durban | Friday
A DEAL between Russian diamond monopoly Alrosa and South African diamond giant De Beers is likely to be delayed until next year, sources in Moscow told the Johannesburg daily newspaper Business Day.
The current contract between Alrosa, which is the second-biggest diamond producer in the world, and De Beers for the sale of rough Russian diamonds on the international markets expires on December 31.
De Beers is now preparing for open trading of Russian diamonds for up to three months of 2002, the newspaper said.
The report says negotiators for both parties have almost completed an agreement, tentatively committing to an annual volume of Russian rough stones worth $800-million — half the diamond production of Alrosa in 2000.
The terms, according to Alrosa and De Beers sources, include an undertaking on the volume to be delivered by Alrosa and a five-year duration with a pricing guarantee from De Beers.
But, Business Day reports, the parties have not yet agreed what proportion of the sales should be run-of-the-mine production, among which are higher quality stones which the Russian polishing industry wants to reserve for itself.
Alrosa’s chief executive Vyacheslav Shtirov is to attempt to secure government approval for the deal, yet meetings to authorise it have been postponed and he will fail.
The President of Russia’s Sakha republic, Mikhail Nikolaev, reportedly reached a deal with Russian President Vladimir Putin that Shtirov would be his successor following elections scheduled for December.
But Nikolaev has reneged on the deal and now not only him, but also Shtirov and their supporters in the region are the target of a behind-the-scenes campaign to remove them.
“Alrosa, the principal source of cash in the region, is now the focus of the attack, Moscow sources say.” – AFP