On 5^th-6^th July, 2004in Moscowthe president of ALROSA V. Kalitin had negotiations with the delegation of Endiama, Angolan national diamond mining company. Both companies have an 11-year record of successful co-operation.

The delegation of ENDIAMA headed by the Chairman of the Administrative Board Dr. Manuel Arnaldo de Sousa Calado arrived in Russiato negotiate on the expansion of co-operation, and get better knowledge of the ALROSA diamond mining operations in Russia. The Angolan delegation also includes members of the Admininstrative Board and heads of several departments.

Mr. Kalitin and Dr. Calado discussed some aspects of the companies’ joint mining projects in Angola.  ALROSA and ENDIAMA are co-founders and partners in two mining societies– Catoca and Camatchia-Camagico. The first of the two has been operating for a few years now and is the largest and most efficiently run diamond mining operation in Angola. As to the other, it is preparing to launch an ore treatment facility in early 2005.

The parties expressed mutual satisfaction with their Catoca operation and outlined a number of measures to accelerate the construction of the mine’s second stage which is to be commissioned in December 2004. The new ore treatment facility will enable to increase output two-fold and process 7.5 million tons of ore, with total diamond sales reaching some US $ 350 million. The construction is carried out by Russian specialists and is based on Russian technologies and know-how. The bulk of the machinery and equipment for the ore treatment plant will be manufactured in Russia.

The Camatchia-Camagico Mining Society will develop two kimberlite pipes of the same names, comparable to Catoca by their diamond reserves.

The heads of ALROSA and ENDIAMA signed a memorandum of co-operation incorporating all the relevant issues raised in the course of the negotiations – including introduction and application of new technologies in exploration, mining, ore treatment, diamond sorting, grading, valuation and sales, as well as establishment of joint ventures in exploration and mining, construction and operation of a cutting and polishing factory in Luanda.

The parties agreed on co-ordination of their activities in relation to diamond prices depending on the situation in the world market.

Special attention at the negotiations was given to training personnel for Catoca and Camatchia-Camagico. Training programs for geologists and mining engineers, sorters and grading experts can be organized at ALROSA training centers and universities in Russia. Mr. Kalitin said that his company will render all necessary assistance in this field.

The ENDIAMA delegation will be in Russiauntil 11 July. ALROSA’s partners will be meeting with the Dean of the St. PetersburgStateMiningUniversity. In Yakutia they will be visiting ALROSA’s flagship personnel training center to get a better idea of its educational potential. They also plan to discuss designing and construction issues concerning Camatchia-Camagico at the Yakutniproalmaz Research Institute and take a tour of the Nyurba Integrated Mining and Processing Complex.

For your reference:

ENDIAMA was established in 1981 on the basis of Diamang Company which had existed since the early 1900s. Now ENDIAMA is one of the world's largest and most dynamic companies. It owns the rights for some 80 discovered primary diamond deposits.

Catoca Ltd. based in the Lunda Sul Province of Angola was established on 16 September 1993by ENDIAMA (32.8%), ALROSA (32.8%), Israeli Daumonty Financing Company B.V. (18%) and Brazilian Odebrecht Mining Services Inc. (16.4%). According to exploration results reserves to the depth of 600 m at Catoca are estimated at 271 million tons of ore.

Camatchia-Camagico Mining Societywas established in Angolafor the development of the Camatchia and Camagico pipes. The major shareholder in this venture is ESCOM-ALROSA (owned jointly by ALROSA and Portugese Espirito Santo) with a 45% interest. The co-founders are a few Angolan companies including ENDIAMA.