PJSC Alrosa is actively looking to expand its footprint globally, the company's vice president for African operations told S&P Market Intelligence on the sidelines of the Mining Indaba in Cape Town, South Africa.
"We are looking to expand," Vladimir Marchenko said, adding that even geographies such as Latin America have not been ruled out. "At the moment, we are mostly focused on Angola [outside of Russia], but the company is actually actively looking for opportunities to expand the business worldwide."
"We have been approached by many different countries, including Zimbabwe, Venezuela, India and some other countries," Marchenko added. However, he said that apart from Alrosa's main home market, efforts are concentrated on the widely unexplored Angola, not least because reserves in many other jurisdictions, including South Africa, Namibia, Australia and Botswana, are depleting.
It was one of the reasons Alrosa exited its joint venture with Botswana Diamonds. Marchenko said, "Over a period of three years we didn't get any significant results, and we financed the story, so we decided to stop."
He said that even assets such as Rio Tinto's Argyle mine in Western Australia were coming to the end of their life. "We believe in two or three years, maybe a little bit more, they are going to shut it down."
"We believe that the African market is important for us. It is the only place outside of Russia where there is an opportunity left," Marchenko said. "With Angola, we moved to a promising country in Africa. But we still have to pay a lot of attention to Russia, where we have reserves up to 1 billion carats and we had a lot of discoveries. This is a portfolio we are still keeping."
Alrosa owns a joint venture with the Angolan government and in 2017 agreed to develop the Luaxe deposit. "We are in the process of discussing the feasibility study and will finalize this very soon," Marchenko said. "In the meantime, we are already moving a lot of soil and preparing for the pit."
While many African countries have undergone a shake-up in regulation and legislation in recent months, often opposed by mining companies, Marchenko said they were very happy with the environment in Angola and the policies of the new president, Joao Lourenco.
"We entirely support what [the government] are doing, and we believe it will increase investment in the country dramatically," Marchenko said.
Generally speaking, alongside aspects of geology and reserves, he said government relationships and issues around legislation are the first priority when making investment decisions.
"Zimbabwe, for example, used to produce 12 million carats a year, while today they produce 1 million carats a year. This was mostly related to government issues, I believe."
