U.S.-based African Discovery Group (AFDG) has inked a letter of intent to acquire the uranium exploration license for the Ouricha-3 deposit in Niger from Central Global Access International Niger (CGAIN).
Meanwhile, GoviEX intends to pursue legal action over the revocation of its mining rights to the Madaouela deposit.
Details of the Ouricha-3 Transaction
The transaction involves AFDG issuing shares to CGAIN, an international company with diverse operations, and the existing operational team.
This is expected to result in AFDG’s current shareholders retaining majority ownership. The Nigerien government is also anticipated to “maintain a working interest in the operations of the Niger license after cost recovery.”
Transaction Timeline and Company Rebranding
The transaction is projected to close in the fourth quarter of 2024, pending shareholder approval, standard due diligence, and documentation.
Delaware-based AFDG, focused on developing projects in Africa, plans to rebrand as African Uranium upon closing. The company intends to appoint a Chief Executive Officer with extensive experience in uranium exploration in West Africa, while the existing exploration team is expected to remain in their roles.
AFDG’s Vision for Uranium Exploration in Africa
AFDG stated that this transaction will create a uranium exploration company “concentrated on unlocking value in Africa’s underexplored uranium basins.”
After closing, AFDG will solely focus on uranium exploration across the African continent.
In collaboration with the Nigerien government, African Uranium aims to cultivate local skills to develop the promising nuclear industry in the region.
Promising Location of Ouricha-3
AFDG Chairman Alan Kessler expressed enthusiasm about the “paradigm-changing venture,” emphasizing their commitment to this transformative move for the company and its shareholders.
Ouricha-3 is strategically located in Niger’s northern Agadez region, 35 km northwest of Global Atomic’s high-grade Dasa project and 20 km south of Orano’s Imouraren uranium mine, one of the world’s largest uranium reserves. The deposit straddles the Arlit fault, a key geological feature for uranium mineralization in the area.
Historical Exploration and GoviEx’s Challenge
Exploration around Ouricha-3 began in 1977 by France’s Cogema. Over two-thirds of the Ouricha-3 permit lies within the Afouday perimeter, previously explored by Areva in 2006.
Following a coup d’état in Niger last year, authorities revoked the operating permit for Orano’s Imouraren mine and recently withdrew Canada’s GoviEx Uranium’s mining rights to the Madaouela deposit.
GoviEx Contests Madaouela Decision
In a July 17th letter to stakeholders, GoviEx Uranium Executive Chairman Govind Friedland expressed his dismay at the withdrawal of mining rights, calling it “especially perplexing.” He emphasized that any new developer would essentially have to “start from scratch,” leading to significant project delays.
Friedland argued that these delays contradict the government’s stated goals for rapid development and economic progress. GoviEx asserts that the decision violated the withdrawal procedure outlined in the mining code.
Legal Action and Focus on Zambia
GoviEx is prepared to pursue legal action to protect its rights and investments, having formally contested the decision with the Ministry of Mines. The company is also seeking independent assessments of damages resulting from the withdrawal.
GoviEx now intends to concentrate on developing its Muntanga uranium project in Zambia, which it has been advancing since 2016. The company believes this project holds immense potential and will become a cornerstone of its future.