Angola expels Russia from one of the largest diamond mining projects due to sanctions
russia has expressed readiness to leave the project, but only on condition of monetary compensation, angola is against it
The Angolan government is demanding that the Russian group of companies (GC) Alrosa withdraw from the Katoka diamond mining project due to Western sanctions.
Source. This was reported by The Moscow Times with reference to Expansao.
The deposit is being developed by Sociedade Mineira de Catoca, 41% of which is owned by the Angolan national company Endiama. "Alrosa owns a similar share. Another 18% of shares are held by the international holding LL International Holding B.V.
According to the newspaper, the Angolan authorities have been trying to get rid of the Russian company's share in the joint venture for several months now, as the diamonds it mined have become "toxic" for sale. Endiama President Ganga Junior said that Alrosa's presence undermines the credibility of the mine developer in the international market, and many banks refuse to work with them because of such cooperation.
The Russian company has expressed its readiness to leave the project, but only if it is compensated for its investments. However, Luanda ruled out the possibility of payments, noting that the mine is Angola's "heritage" and therefore the country owes nothing to anyone, and Alrosa must leave "immediately and without any demands."
In mid-January, Angola sent a delegation to Dubai to meet with Russian authorities in another attempt to unblock the deal. One option is for Alrosa to leave the country with a guarantee of return after sanctions are lifted in the future. However, Moscow is suspicious of such a proposal given Angola's rapprochement with the United States.
Catoctin is the world's fourth-largest deposit in terms of reserves. In 2019, the mine's reserves were estimated at 120 million carats. About 6.8 million carats of diamonds are mined annually in Catoctin.
The European Union blacklisted Alrosa and its CEO Pavel Marynychev on January 3. This happened against the backdrop of the ban on imports of Russian diamonds, which was introduced as part of the 12th package of sanctions and came into effect on January 1. Alrosa has been operating in Angola since 1992.
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