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May 26, 2014

Areva signs deal with Niger over uranium mining operations

French multi-national group Areva will continue its uranium mining operations in Niger after agreeing with the government to pay more taxes and increase royalty rates for its mines.

By Rohit

French multi-national group Areva will continue its uranium mining operations in Niger after agreeing with the government to pay more taxes and increase royalty rates for its mines.

With this deal, Niger will receive higher tax payments as per the terms of a 2006 mining law, which reduces tax exemptions.

The agreement paves the way for Areva to renew the mining contracts held by its SOMAÏR and COMINAK units.

Under the five-year deal, Areva and the Niger Government will take measures to ensure the economic and financial profitability of the uranium mines, and to prioritise jobs.

"I commend this agreement, which commits the partners over the long-term and affirms the major place held by Niger in the global uranium industry." 

The parties will also appoint managing directors of Nigerien nationality to SOMAÏR this year and COMINAK in 2016.

Areva president and CEO Luc Oursel said: "In the context of a difficult uranium market, AREVA and the State of Niger have succeeded in reaching a balanced and sustainable agreement to pursue their historic partnership."

"I commend this agreement, which commits the partners over the long-term and affirms the major place held by Niger in the global uranium industry. I am particularly pleased for Niger and for AREVA."

In addition, the French firm will invest €90m to build new roads to mines in Arlit, construct a building to house the mining companies with €10m funds and provide €17m to accelerate the development of the Irhazer valley.

SOMAÏR is a subsidiary of Areva that has been engaged in mining uranium deposits in north-western Niger since 1971. Areva holds 63.6% of its capital and 36.4% via the Nigerien agency, SOPAMIN.

Areva owns 34% of COMINAK, which is located at a depth of 250m with uranium ore estimated at an average grade of 4%.

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