Alrosa supervisory board member says Gokhran may buy more rough goods before end of year

Russia's state precious minerals repository, the Gokhran, may acquire more rough diamonds from miner Alrosa this year, according to a source familiar with the subject.

The unplanned purchases from Alrosa might necessitate changes in budget targets regulating purchases of precious stones and metals for the state repository, Interfax reported.

"Gokhran has such a right [to acquire additional diamonds]," a source on Alrosa's supervisory board tells the news agency. "The market is difficult right now and such a buyer would benefit the company," he says, without providing a precise figure regarding possible purchases.

The proposed purchases have not yet received government approval, but the process relating to a draft resolution has begun, an official tells Interfax. The government is proposing the funds be provided to enable the purchase of rough from Alrosa, he says.

The budget target can only be changed by government decree, and officials have said the Gokhran will not make any further large-scale acquisitions of rough diamonds in 2012 unless it receives a special executive order.

Alrosa has already sold US$1.1 billion (3.48 billion rubles) of rough to the Gokhran this year in a deal closed in the second quarter.

The Gokhran's budget targets propose the acquisition of up to US$1.27 billion (4.0 billion rubles) worth of rough diamonds this year, 40 percent of its total budget for the acquisition of state reserves of precious metals and stones in 2012 of US$3.17 billion (9.95 billion rubles).