GoviEx Shares Plunge as Niger Revokes Madaouela Uranium Mining Permit
Shares in GoviEx fell by 29% last week after the company announced that Niger had withdrawn the mining permit for its Madaouela uranium property.
“GoviEx Uranium has been informed by the Government of the Republic of Niger, via a letter from the Minister of Mines, that it no longer has rights over the perimeter of the Madaouela mining permit, which is now in the public domain,” the company stated.
This development is a significant blow to GoviEx, which has been developing Madaouela since 2007. GoviEx CEO Daniel Major, who has been with the company for most of that time, had been aiming to secure financing for the $343 million project this year.
In April, Miningmx reported that Niger’s military junta was pressuring GoviEx to start mining at Madaouela by July or risk losing its mining permit. GoviEx stated today that the permit’s revocation was not in line with the country’s mining code.
On March 18, GoviEx reported the commencement of front-end engineering designs for Madaouela. This followed an earlier announcement on March 4 that the company had begun financing due diligence for the proposed mine.
GoviEx noted that it had received expressions of interest for $200 million in funding and had reached other development milestones, including initial groundworks and exploitation.
“GoviEx believes that the Government’s decision to withdraw the mining rights for the Madaouela Project will negatively impact the economic and social development of the region,” the company said.
The former government of Niger, led by President Mohamed Bazoum, was overthrown in a military coup in July last year. A military junta, led by General Abdourahamane Tchiani, subsequently took over.
The junta expelled French troops and severed security pacts with the European Union, raising concerns among Western allies that Niger could become a new foothold for Russia in the region, according to Reuters.
The new government has swiftly moved to cut ties with the West while encouraging more cooperation with Russia. Last month, Niger revoked the operating license of French nuclear fuel producer Orano at one of the world’s largest uranium mines, continuing its break from its former colonial power, France, as reported by Aljazeera.
State-owned Orano was ordered out of the Imouraren mine in northern Niger, which holds an estimated 200,000 tons of uranium, according to the news service.
The government of Niger holds a 20% stake in COMIMA, the Nigerien company set up to develop Madaouela. Major recently stated that the coup had “created some challenges,” but he remained optimistic about potential changes and continued engagement with lenders and potential off-takers.
GoviEx will continue to advance its mine-permitted Muntanga project in Zambia and is expected to publish its feasibility study in the second half of 2024.
