Vancouver-based mining company GoviEx has been abruptly informed by Niger’s Minister of Mines that its rights over the Madaouela uranium mining permit have been revoked.
The permit area has now been declared public domain, leaving the company with no claim to the project.
Dispute Over Withdrawal Process
GoviEx asserts that this decision was made without adhering to the withdrawal procedure outlined in the mining code. The company had been operating in Niger since 2007, progressing the Madaouela project from initial exploration to the completion of a feasibility study in late 2022, despite historically low uranium prices.
Project’s Potential and Development Progress
GoviEx claims to have conducted extensive drilling operations, defining a mineral resource that is now considered among the largest known globally. With the recent resurgence in uranium prices, the Madaouela project was poised for development, and the company had commenced preliminary work despite the political changes in Niger following last year’s coup d’état.
Recent Ministerial Visit and Industry Context
Niger’s Mines Minister Ousmane Abarchi recently visited Madaouela during a tour of exploration and mining projects in the northern Agadez region. During this visit, he reviewed ongoing groundwork and mine plans at GoviEx’s project. Just two weeks prior, French company Orano also had its operating permit for the Imouraren uranium mine revoked by Nigerien authorities.
Legal Challenge and Concerns Over Economic Impact
Like Orano, GoviEx has expressed its commitment to engage with government officials and stakeholders but reserves the right to challenge the decision. The company believes that revoking the mining rights will negatively impact the region’s economic and social development.
With an estimated initial capital expenditure of USD 343 million, the project was expected to generate significant employment opportunities and contribute substantially to the government through royalties and taxes.
Ownership Structure and Ongoing Projects
The Niger government holds a 20% stake in COMIMA SA, the Nigerien company established to develop the Madaouela project. Despite this setback, GoviEx plans to continue advancing its mine-permitted Muntanga project in Zambia, with a feasibility study expected in the latter half of this year.