Niger and GoviEx agree Madaouela project framework

Tuesday, 9 April 2019

GoviEx's existing Madaouela 1 mining permit will also be expanded to include previous mineral resources discovered by GoviEx in the Agaliouk permit, adding a further 5.96 million pounds U3O8 (2292 tU) in measured and indicated resources. The company will also be granted renewed nine-year terms for its exploration permits for Madaouela 2, 3 and 4, which had reached the end of their exploration periods under the 2006 Niger mining code.

Govind Friedland, executive chair of Vancouver, Canada-based GoviEx, said the agreement was the culmination of more than 12 years of "relentless work and millions of man hours" by the company's management and its Nigerien community.

"Through these series of agreements, the company and the Niger government are laying the foundation necessary to develop the Madaouela project in a fair and equitable way for the long-term benefit of all stakeholders, and we are grateful for the support of all who have contributed to our success," he said.

The Niger government already holds a 10% free carried interest in GoviEx under the country's 2006 mining code. It will purchase an additional 10% for USD14.5 million. This will be by the conversion of a final EUR7million (USD7.9 million) acquisition payment and settlement of previously challenged taxes of USD6.6million related to Madaouela. On finalisation of the transaction the company will be effectively debt-free, GoviEx said. The company will also benefit from a tax abatement period pending project financing for mine construction and project development.

The "commercial understandings" agreed with the government "further positions GoviEx to advance the Madaouela Project as a fully permitted uranium project, currently with 60.54 Mlb U3O8in total Probable Mineral Reserves and a predicted 21 year mine life," the company said.

"GoviEx believes the factors influencing the uranium market fundamentals and the uranium price are improving and continues to prioritise completion of a feasibility study, and negotiations with debt providers and off-takers interested in the Company's long-term uranium development project.

Niger has two operational uranium mining complexes - SOMAIR and COMINAK, both operated by Orano - which account for around 5% of world uranium production.