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Taking Over: The Story of Russian Diamonds

Mining diamonds is an ever-growing industry in modern-day Russia. In August, 2015, it was reported that for the first time, Botswana surrendered its top post as the leading diamond producer in the world by value to Russia. According to the 2014 output data released by the Kimberley Process, Russia saw its output leap 20% to $3.73 billion, while the value of precious stones rose 19% to $97.47 per carat. Its volume jumped 1% to 38.303 million carats.

Alrosa is Russia’s group of diamond mining companies, partly owned by the state. Alrosa explores, mines, manufactures and sells 95% of Russian diamonds, and mines in Africa as well.

Some of the world’s largest mines and diamond reserves (some are yet unexplored) are located in Russia, among them Udachny, Grib and Aikhal.

In 2014, it was announced that Alrosa plans to turn the Udachny mine, whose name means ‘Lucky’, into a 5 million carat per year project, which would make it the largest diamond mine in Russia and one of the biggest in the world. Udachny, just 17 kilometers from the Arctic circle in northern Siberia, was first tapped by Alrosa in 1971 and in the intervening forty-three years it has generated approximately $80 billion for the firm. When underground mining commences, 2.4 million tons of ore will be extracted and sifted annually, and this figure will increase to 4 million tons within four years’ time, according to Mining.com. Udachny’s numbers should allow Alrosa to retain its title as the world’s largest diamond producer by volume for the foreseeable future.

The Aikhal mine, one of the largest diamond mines in Russia and in the world, is located in the north-eastern part of the country. According to Rough & Polished, the mine has an annual production capacity of 1.3 million carats. A 2012 audit confirmed that the mine contains 14 million carats of stones in total, and may contain up to 54 million more carats. According to Alrosa, the mine owner and operator, the major portion of diamond output of the Aikhal Mining Division today comes from the largest open-pit mine of Alrosa – Jubilee.

 

The Mir mine (also called Mirny) was an open-pit diamond mine, now inactive, located in Mirny, Eastern Siberia, in Russia. It is the second largest excavated hole in the world, surpassed only by the Bingham Copper Mine in Utah. In the 1960s, the mine was producing 10,000,000 carats of diamond per year, of which a relatively high fraction (20%) were of gem quality, according to Abazia.com. In the 1970s construction of a network of tunnels for underground diamond recovery began. By 1999, the project operated exclusively as an underground mine. Mir’s surface operation lasted 44 years, finally closing in June 2001. The mine was permanently closed in 2004.

The Grib mine, an open-pit diamond, is owned by oil supplier Lukoil. It is located in the north-western part of the country in the Arkhangelsk Oblast. Grib’s reserves are estimated at 98.5 million carats, with an annual production capacity of 3.62 million carats. This makes Grib the first new non-alluvial diamond mine to produce more than one million carats per year, according to Mining Global. It is expected to become the largest diamond mine in Russia in terms of size.

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