Alrosa Certifies $3.5B Diamond Discovery

Alrosa, Russia’s largest diamond company, said Wednesday its discovery of a major diamond deposit had been certified and could yield at least $3.5 billion.

The Verkhne-Munskoye deposit, certified by Russia’s Federal Agency for the Management of Mineral Resources, will produce 1.2 million to 2 million metric tons of diamond ore a year and take at least 25 years to exhaust, the Moscow company said.

Deeper prospecting could produce even larger reserves, it said.

The deposit, in the western part of the eastern Russian Sakha (Yakutia) Republic, is located about 80 miles from an Alrosa-affiliated mining and processing plant, the company said.

Alrosa, also known as Almazy Rossii-Sakha, accounts for 97 percent of Russia’s raw diamond production and for 25 percent of its global output, the Russian Information Agency Novosti reported.

The state-owned company and its Nyurba GOK subsidiary produced $2.3 billion in diamonds in 2006, surpassing its target 2.4 percent. Its net profits rose 3.2 percent to $610 million.

Russia is one of the world’s largest producers of rough diamonds.