January 4, 2014

Areva's Niger Uranium Mines Halt Production As Licence Talks Continue

Published on Saturday January 04 2014 (AEST)

French state-controlled nuclear group Areva has closed its two uranium mines in Niger for a month of maintenance while it negotiates with the government over the renewal of its licences, a company spokesman said on Friday.

Niger, the world's fourth-largest uranium producer, is trying to extract increased royalties from the French group, with the mines operating in legal limbo after the expiry of their licences. Confirming union information, the company spokesperson said Areva's Somair and Cominak mines have been closed since mid-December and will remain closed until mid-January. The mines' ten-year licences expired on December 31, though Niger issued a decree on December 27 that potentially provides a legal framework for them to continue operating for now.

"The directors of the mines have told us they have stopped operations because they operate in a legal vacuum," Salifou Chipkaou, deputy secretary general of the Synamin miners union, told Reuters.

Inoua Neino, secretary general of Syntramin, another miners' union, told Reuters that the maintenance had merely been brought forward from April. "Contrary to what some are saying, this is not a move by Areva to put pressure on the government during the talks," he said.

An Areva spokesperson said the mines routinely close for maintenance about twice a year for periods between 15 days to a month.

Sources told Reuters last month that the licence negotiations would be extended by up to three months after the two sides failed to clinch a deal ahead of the year-end deadline. The talks have been going on for nearly two years.

Niger accounts for more than a third of Areva's uranium production and President Mahamadou Issoufou's government wants to increase the royalties the company's mines pay from 5.5% of revenues to as high as 12%, officials say.

The former French colony remains one of the world's poorest nations despite its mineral wealth.
Areva, which is nearly 90% owned by the French government, says that an increase in the royalties rate would make its Niger operations unprofitable.

It owns about two thirds of the open-air Somair mine, which produced a little more than 3 000 t of yellowcake last year, and around 34% of the smaller underground Cominak mine.

France obtains 75% of its electricity from nuclear energy but has never said to what extent it relies on Niger for uranium to fuel its 58 nuclear reactors.

Niger authorities and non-governmental organisations say that one in three light bulbs in France is powered by Niger uranium. A French parliamentary committee report in 2008 put the figure at nearly a fifth.

In 2012 Areva sourced nearly 37% of its 9 760 t of uranium production from Niger and French state-controlled utility EDF has told Reuters that Areva supplies 40% of its annual uranium needs.



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