Our Strategy

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The ALROSA Group’s strategy for 2018-2024 was approved by the ALROSA Supervisory Board on November 15, 2018.

The Strategy’s key points are:

  • retaining the lead in the global diamond market
  • focusing on the rough diamond business
  • efficient management of the socially responsible business in order to implement long-term interests of the shareholders

By successfully following the strategy, ALROSA will be able to strengthen its leading position in the diamond market, as well as ensuring a sustainable long-term growth in mining, in profits, and an increase in share value.

Strategic priorities

Focusing on the rough diamond business
ALROSA intends to follow a single-product strategy, with special focus on exploration of diamond fields and mining for rough diamonds, which is the most lucrative segment of the diamond industry with the highest operating margin.
Replacing the depleting mineral resource supplies in order to ensure ALROSA's long term growth
ALROSA will continue investing in the exploration and development of new diamond deposits, as well as in maintaining the current deposits. This will enable us to continue working seamlessly in the long term. Russia still remains ALROSA’s key mining location, but we are also looking at African countries as promising growth areas. ALROSA intends continue to improve our geological exploration, both by improving current techniques and technologies of searching for deposits, and by introducing new solutions.
Increasing productivity through the continuous improvement of operational processes and technological innovation
In order to make our activities more productive and sustain our business regardless of whether diamond prices are stable or dropping, we at ALROSA are actively searching for ways of optimizing our expenditure structure during every stage of the production process. We regularly study new technologies of ore extraction and treatment. Furthermore, ALROSA aims to introduce enhancements to logistics and the processes of sorting and classifying rough diamonds. We plan to improve liquidity by cutting down stock to the minimum.
Meeting the highest standards and building a culture of industrial and environmental health and safety
Occupational health and safety is one of ALROSA’s key priorities. It is our strategic goal to completely eliminate industrial injuries and accidents, as well ensuring the top management is 100% involved in dealing with operational safety challenges. ALROSA also plans to minimize impact of its activities on the environment. We are committed to using and conserving mineral resources rationally, and to meeting the highest international environmental protection and safety standards.
Boosting consumer demand for natural diamonds through targeted marketing
One of ALROSA’s goals is to secure long-term demand for polished natural diamonds by catering for the changing tastes of the target audiences and promoting natural diamonds as a symbol of a deep emotional bond.
Gradually shutting down non-core businesses
We intend to focus on our core business — diamonds — by disposing of non-core assets.
Achieving high social accountability in all regions where we are present
ALROSA’s social policy is based on principles of social accountability; we are happy to enter into mutually beneficial partnerships with government institutions and the local authorities wherever we are doing business. Our long-term roadmap includes maintaining investments in regional development, supporting our own social projects, and providing charity donations and sponsorships.

Investment program

In 2018, the ALROSA Group's Long-Term Investment Program until 2024 was adopted, designed to ensure sustainable development and growth in ALROSA's shareholder value. The program was developed in accordance with forecast plans for diamond production and mining plans aimed at maintaining the achieved level of diamond mining and production process for other types of activities.

Investments, Bln RUB

The ALROSA Group's Key Investment Projects

mine "Udachny"
mine "Udachny"
  • 2014 year
    Production start
  • 5.6 pa, m ct
    Target production
  • 207.6 m ct
    Resource base
More
Type of mining
Underground
Production start
2014
Ramp-up
2021
Target ore output pa, m t
4.0
Target production pa, m ct
5.6
Total CAPEX, Rub bn
63.9
Resource base1, m ct
207.6
1. Diamond mineral resources in accordance with the JORC Code as at 1 July 2018
Verkhnyaya Muna deposit
Verkhnyaya Muna deposit
  • 2018 year
    Production start
  • 1.8 pa, m ct
    Target production
  • 40.4 m ct
    Resource base
More
Type of mining
Open-pit
Production start
2018
Ramp-up
2019
Target ore output pa, m t
3.0
Target production pa, m ct
1.8
Total CAPEX, Rub bn
20.0
Resource base1, m ct
40.4
1. Diamond mineral resources in accordance with the JORC Code as at 1 July 2018
Mayskaya Pipe Quarry
Mayskaya Pipe Quarry
  • 2025 year
    Production start
  • 1.2 pa, m ct
    Target production
  • 12.7 m ct
    Resource base
More
Type of mining
Open-pit
Production start
2025
Ramp-up
2027
Target ore output pa, m t
0.3
Target production pa, m ct
1.2
Total CAPEX, Rub bn
5.6
Resource base1, m ct
12.7
1. Diamond mineral resources in accordance with the JORC Code as at 1 July 2018
Vodorazdelnye Galechniki deposit
Vodorazdelnye Galechniki deposit
  • 2024 year
    Production start
  • 0.4 pa, m ct
    Target production
  • 4.7 m ct
    Resource base
More
Type of mining
Alluvials
Production start
2024
Ramp-up
2025
Target ore output pa, m t
1.1
Target production pa, m ct
0.4
Total CAPEX, Rub bn
2.3
Resource base1, m ct
4.7
1. Diamond mineral resources in accordance with the JORC Code as at 1 July 2018

Focus on core business

ALROSA’s development strategy dictates that we focus on our diamond business and dispose of non-core assets. Program to divest non-core assets started in 2013 includes assets in real estate, energy (gas) farming, insurance, etc. Since then, the number of non-core entities has decreased by 5 times. Proceeds from divestments since 2013 are over RUB 50 bn.


The recent key M&A deals involving ALROSA have included

2020
Sale of 99.75% of shares in NPF Almaznaya Osen
2019
Selling 100% of the Golubaya Volna resort shares
2018
Acquiring 10% of the ALROSA-Nyurba shares increasing the PJSC ALROSA participation up to 97.5%
2018
Acquiring 8.2% of the Sociedade Mineira de Catoca shares increasing the PJSC ALROSA participation up to 41%
2018
Selling our gas assets (Geotransgaz JSC and Urengoyskaya Gazovaya Kompaniya LLC)