Joint–stock company ALMAR – Arctic Diamonds, which is developing placer diamond deposits in the north of the Republic of Sakha (Yakutia), reports the results of its activities and the subsoil user LLC AGK in its structure for the 1st quarter of 2022.
During the reporting period, the company took measures to ensure the sustainability of its operating activities related to the reduction of administrative expenses and optimization of tax expenses through the application of tax benefits, as well as technical support for the performance of geological exploration.
The execution of the exploration plan at both ALMAR fields Beenchime and Khatystakh was carried out in accordance with the geological tasks and the schedule of the IV stage of work, which is scheduled for the period January-April 2022.
The main volume of exploration work was carried out under a contract with Diamonds of Anabar JSC (a subsidiary of ALROSA diamond mining company) for the exploration of two fields – Beenchime and Khatystakh. In the 1st quarter, mining and drilling operations were carried out in the amount of 3,235 linear meters, 409 samples were taken with a total volume of 1,118 cubic meters, 2,236 tons of samples of diamond-bearing sands were removed.
The enrichment of samples is planned for the period from May to August. In 2022, exploration work is expected to be completed at both sites in order to confirm reserves and obtain production licenses in 2023.
According to the results of the 1st quarter, expenses in the amount of 116.3 million rubles were provided, of which 97.2 million rubles were actually disbursed (Russian version).
In the 1st quarter, the main part of the advance payment in the amount of 35 million rubles was paid, so 20% of the cost of the planned works for 2022 under the contract for the granting of services for the complex of geological exploration works with Diamonds of Anabar JSC. In total, 51% was paid under the contract, 39% of the volume of exploration work planned for 2021-2022 was accepted (100% year-on-year).
The reduction in expenses by 19 million rubles is mainly due to the postponement to the second quarter of part of the advance payment for geological exploration, savings under the item transportation of staff and under the items of labor costs and payments to off-budget funds. Mainly due to the received status of an a small and medium-sized business entity in accordance with Federal Law N209-FZ of 24.07.2007 “On the Development of small and medium-sized enterprises in the Russian Federation”.
The report on the results of ALMAR’s activities for the 1st quarter of 2022 is posted in the section to Investors/Information disclosure (Russian version).
On April 14, 2022, ALMAR JSC received the status of a resident of the Arctic zone of the Russian Federation. Due to this, it is planned to significantly reduce tax costs due to subsidies for compensation of insurance contributions. The total amount of savings due to the benefits received for the whole period of the investment project until 2030 will amount to about 600 million rubles or 29% of the planned amount of tax deductions, which will allow the Company to increase the investment efficiency of mining projects and increase the volume of investments in the region.
This year ALMAR plans to carry out an initial placement of 15% of its shares on the St. Petersburg Stock Exchange. All raised funds will be used to complete exploration, confirm reserves and design the development of two placer diamond deposits for an open-pit mining method. The start of diamond mining and sales is scheduled for 2024. It is expected that after reaching the design capacity, the total volume of diamond production will reach 1 – 1.2 million carats per year. The main markets are India and China, where ALMAR plans to export most of its products.