GoviEx Uranium and the Government of Niger have agreed on a framework to jointly develop the Madaouela uranium project.
Under the agreement, the government will acquire a 10% working interest in the project, in addition to its 10% free-carried interest provided under the 2006 Niger mining code.
The move comes after GoviEx received a letter from Minister of Mines Hassan Braze Moussa supporting a commercial framework agreed between the parties.
GoviEx and representatives from the Ministry of Mines will now work together to develop the company’s flagship Madaouela uranium project in Niger.
GoviEx Uranium executive chairman Govind Friedland said: “Through these series of agreements, the company and the Niger government are laying the foundation necessary to develop the Madaouela Project in a fair and equitable way for the long-term benefit of all stakeholders, and we are grateful for the support of all who have contributed to our success.”
The key commercial terms, which have been agreed in principle between the government and GoviEx, are now required to be finalised in definitive agreements and remain subject to other regulatory approvals.
Under the terms mentioned in the support letter, the government will acquire the 10% interest in the Madaouela uranium project by electing to convert about $14.5m of requested payments comprised of the final $7.9m acquisition payment and settlement of previously challenged area taxes of $6.6m.
After the conversion, GoviEx will be debt-free and would also retain a right of first refusal to acquire the 10% working interest in Madaouela from the government.
The government, which further agreed to expand the Madaouela permit to add another 5.96 million pounds of uranium oxide, will grant renewed permits for nine years to the company for its Madaouela 2, 3 and 4 exploration permits.
With probable reserves of 60.5 million pounds, the Madaouela project is expected to operate for 21 years.