ALROSA announced today that the Company will be temporarily suspending mining operations at its Aikhal underground mine and Zarya open pit from May 15, 2020.

This decision was arrived at looking at the decreased demand for, and reduced sales of, diamonds, “as the major consuming economies are struggling with economic headwinds caused by the global spread of COVID-2019 virus”, the Company stated.

ALROSA proposes to put Aikhal on care and maintenance from May 15 to September 30, 2020; and Zarya from May 15 to December 31, 2020.

While Zarya employs 180 miners; Aikhal has a staff of 502 persons. Part of the personnel will continue to be involved in care and maintenance work at the mines.

“These two pipes operate with lowest margins in the Group portfolio due to quality characteristics of stones mined there,” ALROSA said explaining its choice. The decision to suspend operations there is aimed at reducing the accumulation of “less liquid” diamonds, “given the current market conditions”.

While some employees of the mines at which operations have been suspended – and of auxiliary services – will be laid-off, the remaining “will be transferred to other assets or stay in the idle regime”, ALROSA said; and the Company’s HR will develop the necessary social support.

ALROSA also intimated that at its Board meeting to be held in May, a change in its 2020 production plan will be considered.

“The Company intends to recommence production at suspended assets as the market situation improves,” ALROSA stated categorically.

In 2019, ALROSA produced 2.6 million carats from the Aikhal and Zarya pipes together.