ROUGH MINING IN YAKUT (RUSSIA) - ALMAR Arctic diamonds MAIN PROJECT INFO
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ALMAR Arctic diamonds MAIN PROJECT INFO ROUGH MINING IN YAKUT (RUSSIA) (C) ARCTIC MINING COMPANY LLC
ARCTIC MINING COMPANY LLC
Arctic Mining Company LLC (AMC) develops placer deposits in the Arctic under the brand "ALMAR-
Arctic Diamonds" as the owner of licenses for geological exploration, including the search and evaluation
of placed and indigenous diamond deposits:
1. Khatystakh area (96.3 sq. km.), license of
YAKU 0646 KP (2016-2023).
2. Beenchimee area (93.5 sq. km.), license
of YAKU 05120 KP (2017-2023).
In Yakutia, on the territory of the Leno-Anabar
diamond-bearing subprovince, where the license
areas are located, a number of deposits have
been discovered, during the development of
which more than 5 million carats of jewelry-
quality diamonds are extracted annually.
Among them, ultra-large diamonds and
diamonds of rare fancy colors of high purity
were extracted, including the fancy bright pink
diamond "Spirit of the Rose" weighing 27.85
carats, recognized as the most expensive
diamond found in Russia (sold at 26.6 mln
USD), the Creator diamond weighing 298.48
carats – the third largest diamond found in
Russia, the Firebird diamond of a rare bright
yellow shade weighing 34.17 carats, and many
others.
1
MINERAL BASE
inferred resources of alluvial deposits*
Deposit Depth Sand resources Rough content Rough, CT USD/CT Rough, USD
Khatystakh 0-10 m 1.03 mln.c.m. 3.66 ct/c.m. 3.77 mln.ct 15 $/ct $ 56.6 mln
Beenchimee 0-10 m 4.7 mln.c.m. 0.36 ct/c.m. 1.69 mln.ct 90 $/ct $ 152.1 mln
TOTAL 0-10 m 5.73 mln.c.m. 0.95 ct/c.m. 5.46 mln.ct 38 $/ct $ 208.7 mln
Inferred resources of indigenous deposit
Deposit Depth Sand resources Rough content Rough, CT USD/CT Rough, USD
Khatystakh 10-200 m 14 mln.t 2.13 ct/t 30 mln.ct 25 $/ct $ 750 mln
TOTAL 35.46 mln.ct $ 958.7 mln
Exploration target of license areas
The Khatystakh site has sustained high or hurricane diamond-bearing sands. The forecast potential
of the placer deposit at a depth of 0 - 10 meters with the present study is estimated at 3.77 - 10.11 million
carats with an average diamond content in the sands of 3.66 - 4.91 carat per cubic meter. The primary
deposit is a lamproite layer with a capacity of 0.2 - 1 m, a width of 200 km, the forecast potential at a
depth of 10 - 200 m according to the total of tests of tuffogenic-sedimentary rocks conducted in 1982 -
2013 is about 30 million kars with an average diamond content in the rock of 4.91 ct/c.m. (2.13 ct/ton).
The rough are dominated by small stones of good quality with an average accounting value of 15-33
dollars/car. The inferred resources of placer category are estimated at 56.6-253 million US dollars, and
the primary deposit to a depth of 200 m ~ 750 million in US dollars.
The Beenchimee site has a slightly lower sand productivity, which is offset by the larger size of the
diamonds and a higher average accounting cost of ~ $ 90/ct. The inferred resources of the placer are
estimated in the range from 1.7 to 5.3 million carats with an average diamond content of 0.36 - 1.12
carats/cubic meter, which is 153-476 million in US dollars.
ALMAR is planned to develop mineral base by new placer deposits located at its operation region,
there are more than 20 diamond placer deposits that are of industrial significance.
Profitability threshold (World) 35 $/c.m.
Placer Beenchimee (0-10 m) 67 $/c.m.
Placer Khatystakh (0-10 m) 92 $/c.m.
Primary deposit of Khatystakh (10-200 m) 163 $/c.m.
* The conservative estimate of the forecast resources is
confirmed by the independent expertise of the international
consulting company SRK Exploration Services.
* The company and the investment project were evaluated by
FBK Grand Thornton, ALROSA's auditor for more than 20 years.
2
OPERATION
Mining
The work is seasonal and is carried out on a rotational basis. For mining, an
open-pit sand extraction method is mainly used, a separate method of
development for mechanical loosening, which does not require capital
construction, the use of harmful reagents and blasting operations, which ensures
a reduction in capital expenditures, the mobility of production resources and the
safety of work.
Сoncentration
Diamond-bearing sands are enriched separately at each deposit. The
technology of pre-washing is used with the delivery of sorted sand by conveyors
to the X-ray luminescent separation and to the heavy-medium enrichment plant.
This solution does not require significant capital construction, increases the
efficiency of the use of equipment, reduces the cost of logistics and the fund for
the payment of labor costs.
Final refinement & Sorting
The product of the enrichment-heavy concentrate-is sent for final refinement to
the neighboring Molodo deposit, which is being developed by ALROSA (Anabar
Diamonds). Sorting is organized on the basis of the Yakut enterprise of
GOKHRAN of the Russian Federation, which allowed to minimize the terms of
sales of the extracted products and optimize the cost of sorting and storage,
taking into account the seasonality of the work.
Logistics
The convenient location of the license areas: Khatystakh on the bank of the
Lena River, Beenchimee on the winter road Prilensk-Anabar, allows to reduce
delivery times and costs for the delivery and storage of equipment, spare parts
and fuel, simplify and speed up installation and commissioning, maintenance.
3
SALES OF
ROUGH DIAMONDS
Sales forecast (moderate scenario) Rough range
The extracted diamonds will make up a wide
range from 0.1 to 4 carats, up to 80% of which
are of jewelry quality with an average cost of $
40 - $ 100 / ct at world prices (according to the
data bluedax.com).
The main classes of rough will be small stones
-5gr+3 of good quality with low fluorescence.
It is very likely that large diamonds weighing
more than 10 carats are periodically hit,
including fancy color diamonds.
In general, the range of diamonds belongs to
the North (Ebelyakh) type, produced by JSC
"Anabar Diamonds", a subcidiary of ALROSA.
Marketing, sales channels, and sales management
Diamond sales will be carried out among major diamond dealers. Given the small production volume,
15 to 20 customers are enough for effective sales. Taking into account the seasonality of production,
sales will be conducted annually in the 4th quarter.
ALMAR offers its future customers competitive terms, a transparent supply chain through auctions and
forward contracts. Agreements have now been reached on long-term forward contracts with major
diamond dealers from India, Europe and China.
Samples of diamonds explored at the license areas of ALMAR
4
COMPANY HISTORY
2015
The creation of Arctic Mining Company LLC (AGC) by a team of professionals who were
directly involved in the development of diamond mining in Yakutia as part of ALROSA
and its subsidiaries JSC "Almazy Anabara" and JSC "Nizhne-Lenskoe", leading the
production of diamonds in the placer deposits of the Leno-Anabar diamond subprovince.
Preparation of geological projects has begun.
2016
Licenses were obtained for the use of subsurface resources (geological study, including
the search and evaluation of placer and indigenous diamond deposits) in the North-West
of Yakutia on the territory of the Leno-Anabar diamondiferous subprovince.
Exploration have been started at the Khatystakh license area.
2017
At the license areas "Khatystakh" and "Beenchimee", exploration and evaluation works
were carried out and samples of rough diamonds were extracted.
The estimation of the forecast resources is formed.
Positive expert opinions of the Federal State Budgetary Institution "Rosgeolexpertiza" of
the Federal Agency for Subsurface Use of the Russian Federation on the projects of
prospecting and evaluation work on the subsurface areas "Khatystakh" and
"Beenchimee" were received.
2018
Exploration work continued.
Technical documentation for field development has been developed.
A feasibility study of the production complex has been developed.
2019
The international company SRK conducted an independent assessment of the reserves
and confirmed their industrial significance.
Agreements were reached on the organization of sales with the first customers –
Diamond Trading NV, which has been among the top 20 diamond dealers in the world for
decades, with a major Chinese diamond dealer Deltatau Diamond (Shanghai) and the
Indian company Diarough Corp, which is among the TOP 5 diamond dealers in the world.
The company was rebranded and named "ALMAR - Arctic Diamondsic".
Investment documentation for the development of license areas has been developed
2020
Production plans have been adjusted to reflect the pandemic of COVID-19.
ALROSA has been involved to all operations at the exploration stage.
Andrey Karkhu, former Chief Engineer and one of the founders of Almazy Anabara JSC,
a subsidiary of ALROSA that produces diamonds in the ALMAR region, has been
appointed as CEO of ALMAR.
ALMAR has attracted investment from Polarctic Management.
ALROSA's auditor, FBK Grand Thornton, evaluated the company and the ALMAR
investment project.
5
LICENCE AREAS
DEVELOPMENT PLAN
Completion of exploration work: gross sampling and evaluation of a representative sample
2021-
of rough diamonds, submission of reports and confirmation of Proven and probable reserves
2022 for FBU "State Commission on Reserves" of RUSSIA. Exploration works are conducted by
ALROSA subcidiary Almazy Anabara JSC.
2023 Obtaining through licenses for the use of subsurface resources of license areas by ALMAR
on the rights of the discoverer.
2022- Investment stage of placer development: purchase of equipment, recruitment of personnel,
2024 adjustment of production processes, organization of industrial production and sales.
The beginning of the operational stage: the start of industrial production and processing of
diamond-bearing sands, delivery of diamond concentrate, sorting and completing of rough
I 2024 diamonds, preparation for sales.
Start of sales through the system of auctions and tenders. Getting the first revenue,
IV 2024 achieving of operational profitability.
Receipt of the first profit at the end of 2024, payment of the first dividends.
I-II 2025 Next, the annual receipt of dividends.
Completion of production at the Beenchimee site. The beginning of the investment stage of
the development of the indigenous deposit at the Khatystakh site (not included into the
IV 2028 financial model).
Completion of production on the placer of the license area "Khatystakhsky". Completion of
IV 2030 preparations for the development of the indigenous field at this site.
Start of production at theindigenous deposit at the Khatystakh site. The beginning of the
2031 development of new placer deposits.
6
TEAM
ANDREY KARKHU ANDREY NOVIKOV
CEO Deputy general director for commerce
Honored miner of Sakha republic (Yakutia). In the In the field of project management and international
diamond industry for decades, he passed all the trade for more than 20 years. He created a sales
steps of the career ladder from an ordinary branch of ALROSA in Vladivostok, was responsible for
employee to the head of production. He worked as a the development of an export-oriented diamond cluster
chief engineer in the world’s largest enterprise for in the Far East of Russia. He worked as a project
the production of diamonds in loose deposits – JSC director of one of the world’s oldest diamond dealers
“Diamonds Anabara”. For more than 20 years of Diamond Trading NV (Belgium) and Chinese trader
leading production in the company he took part in Delta Tau Diamond (Shanghai). Before working at
creation of production base and development of all ALROSA he realized a number of consulting projects,
deposits of the enterprise. in particular for ALROSA, SBERBANK etc.
SERGEY GRAKHANOV ANDREY ZUDIKHIN
Deputy general director – Deputy general director –
Chief geologist Chief concentrator
Doctor of geological sciences, leading geologist of In the diamond industry for 20 years. He worked his
Russia, chief geologist at JSC Almazy Anabara and way up from the worker of the Molodo concentrating
JSC Nizhne-Lenskoye, he discovered a number of factory to the Deputy chief concentrator of JSC
placer diamond deposits in Yakutian Arctic, put into Nizhne-Lenskoye. He took part in the development of
operation over the past 20 years. Sergey Grakhanov diamond deposits Billah, Talakhtah, Hara-Mas,
is a member of the profile Committee of The state Motorchuna, Daldyn, Tiglikit, Haara-Mas and Big
Commission on reserves of the Ministry of natural Kuonamka in the North of Yakutia. Awarded the
resources of the Russian Federation. Twice awarded badge “Pioneer discoverer of deposit”.
the badge “Pioneer discoverer of deposit”.
7
OFFER FOR INVESTORS
We invite potential investors to participate in ALMAR investment project to develop diamond
deposits in the Arctic of Yakutia and create a modern business that combines the experience and
traditions of Russian diamond miners with the flexibility and dynamics of a modern private
company.
Advantages for investors
High profitability
Fast payback period 4 years and less.
High marginality
89% USERS IN ASIA
Export sales in a low-volatility rough suppliers-controlled market
Stable investment climate and constructive relations with the
leadership of the Republic of Sakha (Yakutia)
A professional team of managers with experience in creating a similar
enterprise, which has become the world's largest in the production of
diamonds on placers.
The mineral resource base makes it possible to develop new deposits
and multiply the reserves of ALMAR.
Contacts
If you are interested, please contact us for more information about the project.
Contact person: Andrey V. Novikov, Deputy Director for Commerce
E-mail: invest@arcticdiamond.ru, Tel: +7 411 250 56 95 ext 102, mob/WhatsApp. +7 985 226 74 28
8
This presentation was prepared by Arctic Mining Company LLC.
THIS DOCUMENT AND THE INFORMATION IN IT ARE PROVIDED IN CONFIDENCE, FOR THE
SOLE PURPOSE OF EXPLORING BUSINESS OPPORTUNITIES BETWEEN THE DISCLOSING
PARTY AND THE RECEIVING PARTY CONCERNING ALMAR INVESTMENT PROJECT, AND MAY
NOT BE DISCLOSED TO ANY THIRD PARTY OR USED FOR ANY OTHER PURPOSE WITHOUT
THE EXPRESS WRITTEN PERMISSION OF THE DISCLOSING PARTY.
This presentation contains preliminary information and is intended solely for discussion.
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