OREANDA-NEWS. April 29, 2010. A regular meeting of the ALROSA Executive Committee took place under the chairmanship of the Company’s President Fyodor Andreev in Mirny, Republic of Sakha (Yakutia), reported the press-centre of ALROSA.

The Executive Committee endorsed the financial model for the ALROSA Group that is subject to final approval by the Supervisory Board. The model has been developed in order to assess the Company’s financial sustainability in the medium term. The model contains basic guidelines for developing annual financial plans for the ALROSA Group up to 2012.

During the projection period ALROSA will continue mining operations at the Udachnaya, Komsomolskaya, Aikhal, Jubilee, Mir, International, Nyurbinskaya kimberlite pipes. In 2012 the underground mines of Aikhal and Mir are expected to reach their design capacity (of 500 thousand and 1 000 thousand tons of ore, respectively) and the underground mine of Udachny to produce its first 25 thousand tons of ore.

During this period the companies of the ALROSA Group will produce a total of 102 321 thousand carats of diamonds. The aggregate rough diamond sales are forecast at USD 9 548.1 million. The Company plans allocations of RUB 24 728.4 million for the underground mines construction. The Company’s liabilities under credits and loans are to be reduced by RUB 15 295.9 million compared with the January 01, 2010 level and will total RUB 90 374.3 million. The net profit of ALROSA is expected to reach RUB 22 050.5 million. Up to RUB 6 236.0 million will be allocated for exploration, and about RUB 1 977.0 will be allocated for the construction of social facilities. Also the Company is planning reserve provisions of RUB 1 billion.

The results of this year’s meeting of the ALROSA management and representatives of labour collectives, held on March 19, 2010, were reviewed. The Executive Committee approved the relevant resolution and the Company’s objectives for 2010 that include as follows:

maintaining and consolidating the leadership in mining and rough diamond sales through development of a system of long-term supply agreements with the world’s major diamond consumers, building up direct and predictable client relationships, geographical diversification of sales, transparent pricing mechanisms and accessibility of rough diamond goods;

expanding mineral reserves;

enhancing HR potential through training and promotion of its own HR pool;

developing efficient technologies of mining and processing of low-grade commercial ores;

implementation in full of the underground mine construction investment program;

converting short-term debentures into long-term ruble and euro bonds, bringing down the proportion of short-term debt, decreasing the aggregate debt level and materially reducing debt service costs;

resuming payment of employee benefits and employee support measures formerly suspended for the reason of the market downturn, including indexation of employee wages and salaries beginning from H 2 2010, and material incentives based on profit & loss results of activities;

entering into a new collective bargaining agreement with the Profalmaz trade union for 2011–2013.

The Committee confirmed the expediency of the participation of ALROSA representatives in the work of Intergovernmental commissions of the Russian Federation, and commissioned the relevant departments to work out guidelines for the ALROSA representatives in those commissions for 2010–2011.