Negotiations between Niger and the French nuclear energy conglomerate Areva have hardened as the two sides seek to reach an agreement on uranium extraction in the Western African country. EurActiv.fr reports.
The talks are still ongoing despite a 31 December deadline, with fiscal matters seen as the most sensitive issue.
Discussions centre on the implementation of Niger's 2006 mining law that allows Niamey to increase taxes on uranium extraction. Areva refuses to comply with the taxation rules and wants to conserve the fiscal exonerations foreseen by the previous extraction agreement.
Although uranium represents 70% of Niger’s exports, it only contributes 5.8% to its GDP, according to Oxfam, the development NGO. Areva rejects those figures and argues that Niger has earned €871 million from uranium extraction in the past 40 years, representing 85% of the direct income generated by this mining activity. Areva has earned €129 million (13%) and €24 million went to foreign partners (2%), the French public company says.
Tug of war
The renegotiation of the contract between one of the world’s poorest countries and the French public multinational are expected to conclude with a new agreement for the next ten years.
Previous contracts expired on 31 December 2013 but Areva minimises the effects this could have. “31 December was not a cut-off date given that the negotiations are ongoing,” a spokesperson for the group told EurActiv.fr.
The date carries some significance, however, as it coincided with a maintenance operation in the two factories in charge of extracting uranium – Cominac and Somaïr.
“The mines are under maintenance until mid-January,” Areva says, refusing to link the progress in the negotiations with the current maintenance operations.
For Oxfam, this is no less than blackmail. “This is typical for this kind of trade negotiations: laying-off employees temporarily, thereby raising the spectre of unemployment,” claims Anne-Sophie Simpere, an advisor at Oxfam.
Areva is also using another lever in the negotiation, warning about the drop in global demand for uranium since the 2011 Fukushima disaster. According to the French multinational, the Japanese nuclear disaster has put the profitability of the two mines in Niger at risk.
Niamey, for its part, is hoping to get a better deal out of Areva's dependence on Niger as its first provider of uranium.
“Areva does not have that many uranium extraction sites and I am not sure they can do without Niger in the short term,” Simpere stressed.
As for the position of the Nigerian government, information varies.
Last week, Mohamed Bazoum, minister of Foreign Affairs, announced that Niamey could relax the taxation system on Areva thanks to the low uranium prices. But the information was swiftly denied by other members of the government, according to the French public radio broadcaster, RFI.
“For the last few days we’ve heard everything and its opposite but when it comes to the transparency of the process, there is no progress,” Anne-Sophie Simpere regretted.
Another bone of contention between Areva and Niamey is the opening of a mine in Imouraren which would make Niger the world’s second producer of uranium. The opening was planned in 2012 but Areva pushed it back to 2016.
This four-year delay means less taxation revenue for Niger and could weigh in the ongoing negotiations.