De Beers Signs New Deal With Alrosa

By Rob Bates -- JCK Online, 11/1/2006 2:00:00 AM

De Beers and Russian producer Alrosa recently signed a deal to jointly explore and prospect properties inside and outside of Russia.

In February, the European Commission told Alrosa it could no longer sell its stones to De Beers after 2009, ending 50 years of sales between the two parties. It is unclear what would happen to any stones unearthed in this agreement, since the EC's prohibition involves stones sold from Alrosa's mines, while this would be a joint venture.

De Beers did not respond to a JCK e-mail for comment. However, the release notes: “Both ALROSA and De Beers are fully aware of the recent decision by the European Commission regarding their trading agreement, and will operate in strict compliance with all competition legislation requirements.”

Alrosa has announced plans to appeal the EC's ruling.

Before the deal was announced, Russian President Vladimir Putin held a private meeting with De Beers chairman Nicky Oppenheimer, on the first day of his trip to South Africa. Putin is the first Russian head of state to visit that country. Oppenheimer will chair the South African wing of the Business Council of Russia, which aims to forge closer business relations between the two countries.