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Article Excerpt
IN BRIEF
Editor's Choice
*** Russia's Yakutia-based diamond monopoly Alrosa this week posted a loss of almost 2 billion rubles in the first quarter, with higher interest and exchange rates being blamed. Alrosa plans to produce $1.87 billion in diamonds in 2009. It targets sales totaling $2.1 billion. Alrosa and De Beers agreed in the fall of 2008 to limit deliveries to the market in order to support prices. Since December Alrosa has only sold diamonds to state-run Gokhran. Alrosa has also cut sales, profit and production forecasts for 2009. Alrosa announced last fall that it would reduce diamond deliveries by 30% to support prices. The company expects to form a reserve of raw diamonds at Gokhran worth $2 billion. The Russian government will make a final decision on the volume and price of the raw diamonds.
*** Raspadskaya, one of Russia's biggest coking coal producers, increased net profit under International Financial Reporting Standards (IFRS) by 120% to $531 million in 2008, the company announced this week. It also said it is not planning to take on further debt in 2009 via loans or other borrowings. The company had total debt of $351 million at the end of 2008, although a Eurobond issue for $300 million accounted for the bulk of this amount. Raspadskaya said that banks are not unilaterally increasing interest rates for the company or demanding the early repayment of existing loans. Raspadskaya also said it hopes to raise capacity utilization to 80% in the second quarter of 2009, a level that equates to about 2.5 million tonnes of coal, he said.
*** Russia's TMK, one of the world's top-three oil and gas industry pipe producers, cut pipe production 17.8% to 581,000 tonnes in the first quarter of 2009, the company said this week. TMK shipped almost 20% less welded pipe in the first quarter year-on-year and 17% less seamless pipe. The decline was mainly attributable to a significant drop in demand, particularly for industrial pipes. The Russian market has contracted 33%. However, TMK anticipates a production increase in the second quarter.
PRECIOUS METALS
Prokhorov sells $103 mln in Polyus Gold stock in December
MOSCOW. (Interfax) - Mikhail Prokhorov, the owner of the Onexim Group, sold $103 million worth of stock in Polyus Gold, Russia's leading gold producer, in December 2008, the company said in a statement on the London Stock Exchange.
Prokhorov sold 5.913 million shares in Polyus at a price of $17.47 per share. Following the sale, he owned 3.618 million shares, or 1.89% of the company's stock.
The Onexim Group told Interfax that "this was an internal transaction, which did not result in a reduction in Prokhorov's stake in the capital of Polyus." The group provided no further details on the transaction.
Onexim Group, which owns around 30% of Polyus, controls the company by virtue of its majority on the board of directors and management. Vladimir Potanin's Interros also owns approximately 30%.
Newspapers on March 3 quoted sources as saying Vladimir Potanin had sold a large block of shares in Polyus Gold to firms controlled by Suleiman Kerimov. Vedomosti said 20% had been sold and Kommersant said 22%.
PRECIOUS METALS
Polyus Gold board recommends waiving dividends for 2008
MOSCOW. (Interfax) - The board of directors at Polyus Gold, Russia's leading gold producer, recommended on Monday that shareholders vote to waive dividends for 2008 at their annual general meeting, the company said in a statement.
Polyus Gold general director Yevgeny Ivanov said earlier that the company was not planning to adjust its dividend policy, despite the global crisis, and intended to pay dividends for 2008. The company's policy is to pay up to 25% of net profit to IFRS but, when making its dividend recommendation, the board takes limitations imposed by the need to fund operating and investment activity into consideration.
The company paid dividends of 2.95 rubles for 2007 for a grand total of 562.352 million rubles.
Polyus Gold edged output up to 38 tonnes (1.22 million oz) of gold in 2008. Ivanov said earlier that the ruble's devaluation had enabled Russian gold producers to significantly boost sales revenue.
The AGM is slated for May 15. Shareholders registered as of March 27 will be allowed to take part in the AGM.
Mikhail Prokhorov's Onexim Group, which owns around 30% of Polyus, controls the company by virtue of its majority on the board of directors and management. Vladimir Potanin's Interros also owns approximately 30%.
Newspapers on March 3 quoted sources as saying Vladimir Potanin had sold a large block of shares in Polyus Gold to firms controlled by Suleiman Kerimov. Vedomosti said 20% had been sold and Kommersant said 22%.
PRECIOUS METALS
Vysochaishy reduces gold production 23% in Q1
MOSCOW. (Interfax) - Russian gold producer OJSC Vysochaishy reduced gold production 23% in the first quarter of 2009 year-on-year to 596.7 kg (17,500 oz), the company said.
The decline was the result of lower gold content in the ore and the maintenance shutdown of one of the two lines at the N2 gold extraction plant.
Revenue from sales of gold amounted to 504.2 million rubles in the quarter, down from 548.1 million rubles in the same quarter last year.
Vysochaishy has placer and vein gold deposits in Irkutsk and Amur regions, as well as in Yakutia and Komi. The company boosted production in 2008 28% to 4 tonnes. It targets production of 4.2 tonnes this year.
PRECIOUS METALS
Canada's Kola Mining acquires gold ore field in Krasnoyarsk Territory
MOSCOW. (Interfax) - Canada's Kola Mining signed an agreement to acquire OOO Artel Staratelei Angarskaya Proizvodstvennaya Kompania for 24 million rubles, which holds a license for the Bogunay gold ore field in the Krasnoyarsk Territory, Kola Mining said in a statement posted on its website.
It was earlier reported that the license for the Bogunay field belongs to Britain's Trans-Siberian Gold (TSG).
The statement said: "The area had been closed due to its proximity to a Soviet strategically sensitive location until 2002, at which time a license to conduct exploration and subsequent production of gold was issued. It is in effect until 2026. Since the issuance of the license, more than US$2 million has been invested in exploration of the licenses. This work has included drilling, ground and airborne geophysics, trenching and chip sampling, environmental and as well as several other studies. This work has led to the estimation of potential gold summarized above."
The statement said: "Under the terms of the agreement Kola will pay the vendor approximately 24,000,000 Russian Rubles (approximately US$700,000). OOO also has an outstanding loan with a...
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