Media: Zimbabwe prepares with “ALROSA” and JSC “Tatneft” a deal to exchange diamonds for fuel

Moscow, 26 Nov – “News.Economy.” Zimbabwe can make a deal on the $1.4 billion to ensure fuel supplies in exchange for diamonds, the parties to the contract will be the Russian “Tatneft” and “ALROSA”, according to local newspaper The Business Times.
 

ALROSA denies participation in the transaction, to obtain explanations from Tatneft “Interfax” failed. Zimbabwe is experiencing a fuel shortage because of the unstable rate of national currency and offers diamonds in exchange for diesel fuel. Diamonds mines of the state Zimbabwe Consolidated Diamond Company (ZCDC), partner ALROSA created for this year of the joint venture, the newspaper notes, citing sources.

The deal can be concluded until the end of November. “It is expected that the deal will come into force in 2020 and diesel fuel deliveries will continue for three years”, – emphasizes the newspaper.

The deal suggests that ALROSA will begin to obtain diamonds from ZCDC $40 million per month. ALROSA will appreciate these diamonds and pay them within 30 days, after which “Tatneft” will supply the agreed amount of diesel oil via the port of Beira (Mozambique).

The fuel supplier will perform the Swiss firm (in Swiss operates a trading subsidiary of Tatneft Tatneft Europe AG). Due to fluctuations in the market “Tatneft” will be able to reduce the price of diamonds by 30%, writes The Business Times.

According to representative ALROSA, “the company has nothing to do with the material described in the project and does not conduct any negotiations on this subject”.

ALROSA and the government of Zimbabwe signed in July the agreement of the joint venture, under which ALROSA will allocate in 2020 and $9 million, and in 2021 – up to $14 million in greenfield exploration and evaluation of diamond potential of kimberlite pipes open.

ALROSA will receive SP 70%, the company will be engaged in the production and sale of diamonds. ALROSA holds “very large” hope for the discovery of native deposits in Zimbabwe, believing that the field of “Marang” may be the remnant of a larger kimberlite, noted the Deputy Director of the company Vladimir Marchenko.

Diamond mining in Zimbabwe, which reached 17 million carats in 2013, mainly due to the deposits of “Marang” has dropped dramatically in recent years. The country is trying to increase production from the current 3.2 million carats to 6 million carats by the end of 2023.

Zimbabwe has lifted restrictions for foreign investors control in mining. The Finance Ministry reduced the size of royalty for gemstones from 15% to 10%, which will allow you to reduce costs in the development of indigenous deposits.
 

© 2019, paradox. All rights reserved.