OREANDA-NEWS. On December 12, 2007 the Company’s Executive Board held under the chairmanship of its President Sergey Vybornov its regular meeting at its headquarters in Mirny, Republic of Sakha, Yakutia, reported the press-centre of ALROSA.

The Executive Board considered ALROSA’s production plan for 2008.

The plan incorporates strategic targets and priorities set for production, economic and social development of ALROSA and ALROSA Group. The specifics of the 2008 Plan that have had a material effect on the Company’s targets are as follows:

- smaller revenues due to a considerably lower ruble-US dollar exchange rate;

- increased expenses for the purpose of setting up a new geological prospecting and exploration unit in the Zhigansk District of Sakha (Yakutia);

- a reduction in costs due to a modification of the VAT implementation regime for domestic sales of rough diamonds;

- an increase in costs due to higher depreciation and amortization costs and higher property tax payments to be made on the basis of the market value of the former PNO Yakutalmaz capital assets from 01.04.2008 estimated for the purposes of the implementation of the Amicable Settlement Agreement between the Russian federation and the Republic of Sakha (Yakutia).


The Executive Board approved the following objectives for ALROSA Group for 2008:

- more active prospecting in potentially diamondiferous areas on the basis of the Arctic Prospecting and Exploration Expedition located in the Zhigansk Region of Sakha (Yakutia);

- more efficient marketing and sales, improved commercial activities, optimization of the exhisting structure of ALROSA representative offices and affiliates;

- implementation of the programme for the construction of underground mines at the Udachnaya, Mir, Aikhal, International deposits;

- commissioning of an automated sorting facility (КСА) at the Gornoye Deposit;

- modernisation of ore treatment plant No. 3 to meet the 2008-2009 production targets;

-more efficient management of ALROSA’s African assets through modifications in the organizational structure.

The main economic targets for 2008 are subject to approval by the Supervisory Board.

The Executive Board considered ways of more efficient management of ALROSA’s African assets.

The Board resolved that the management of ALROSA’s assets in Africa should be centralized and a 100% ALROSA holding asset management subsidiary should be established. The new company will have affiliates in African countries and will be registered in Saint-Petersburg. Its goals are coordination of the Company’s Angolan assets management, organization of cooperation of cooperation between ALROSA and diamond mining companies from other African countries, establishment and implementation of new investment projects, participation in companies specializing in sales of African-mined diamonds.

Upon considering the activities of ALROSA foreign-based representative offices, the Board resolved that as ALROSA selling companies operating in Belgium and Israel are capable of performing representative functions, ALROSA representative offices in these two countries should be liquidated.

The Board considered internal regulations on the use of ALROSA residential properties by ALROSA employees, and corporate support of ALROSA employees on their acquisition of residential property.

The Board also resolved other issues related to ALROSA’s day-to-day operations.