GoviEx pressured by Niger military junta to fast track the Madaouela uranium mine

Uranium concentrate

The government of the Republic of Niger is putting heavy pressure on Canadian junior miner GoviEx Uranium to speed up development of its proposed $343m Madaouela uranium project.

GoviEx reported today it had received notice it must commence mining at the Madaouela project by July 3 this year “failing which there is a risk of revocation of its mining permit”.

The government demand appears unrealistic given the early stage of development that the project is at.  Crucially, the Madaouela project is not yet funded.

GoviEx has responded by saying it is “committed to developing the project” but has also pointed out it has other projects in its portfolio including a mine-permitted uranium project in Zambia.

On March 18 GoviEx reported that it had started front-end engineering designs for Madaouela.  This followed an earlier statement on March 4 that GoviEx had started financing due diligence to fund the proposed mine.

GoviEx CEO Daniel Major said at the time the company had received expressions of interest for more than $200m in potential debt financing but the due diligence stage was expected to take several months longer as the company negotiated with a “select group of lenders”.

The former government of Niger under President Mohamed Bazoum was overthrown in a military coup in July last year after which a military junta  led by General Abdourahamane Tiane took over.

The junta then kicked French troops out of the country and severed security pacts with the European Union leaving Western Allies concerned that Niger could become a new foothold for Russia in the region according to Reuters.

The government of Niger holds a 20% stake in COMIMA which is the Nigerian company set up to develop Madaouela.

Major said at the time the coup had “created some challenges” but that he was optimistic this could change, and the company continued to engage with lenders and potential off-takers.

Friedland said on April 19 that “the company is committed to developing the project and is working with the Nigerien government towards a mutually beneficial solution that complies with applicable law and protects the company’s rights.

“While there is no guarantee of the outcome of these discussions, GoviEx is committed to exploring all viable options to ensure the best results for the company and all of its stakeholders.

“In parallel with the discussions with the Government, GoviEx is in discussions with third parties regarding potential investments to expedite the development of the project.”

Friedland pointed out that GoviEX had advanced the project from its initial exploration phase through a period of historically low uranium prices to publication of the feasibility study in late 2022.

But, significantly, Friedland also commented that, “although we continue to be dedicated to Niger, it is important to note that GoviEx is an international company with a diverse portfolio of projects. We continue to progress our mine-permitted uranium project in Zambia which is expected to publish its feasibility study in the second half of this year.”