MOSCOW, June 30 (RIA Novosti) - Russia's largest diamond producer Alrosa [RTS: ALRS] plans to sell two oil and gas assets in Western Siberia worth $400-700 million, business daily Vedomosti reported on Monday.

According to the paper, the Geotransgaz and Urengoi Gas Company have total reserves worth $1 billion in oil equivalent. Prospective buyers for the oil and gas assets are yet unknown, but Gazprom is not believed to be among the list of bidders.

Alrosa and J.P. Morgan, which is assisting the diamond producer in the search for buyers, have declined to comment on this information, Vedomosti said.

Analysts say companies like Russian independent gas producer Itera and Novatek that have the possibility of transporting natural gas via Gazprom's network of pipelines may be interested in the purchase.

Alrosa, which accounts for 97% of Russian and 25% of global diamond output, produced diamonds worth $2.37 billion in 2007.

On June 18, the Russian government finalized a deal to increase its stake in Alrosa to 50% plus one share. The Republic of Sakha (Yakutia), where Alrosa's diamonds are mined, and eight of the republic's districts retain 32% and 8% of the company's shares respectively.