The government of Niger said Monday that it has renegotiated its expired mining contract with the French uranium company Areva, after more than two years of negotiations. Activists say they are cautiously optimistic about the terms of the new deal, in which Areva has promised to increase royalties to the country and invest in local infrastructure.
The exact terms of the new contract have not yet been made public, but according to a joint statement by Areva and Niger's government, Areva has agreed to operate under the framework of the country's 2006 mining code, which requires paying an increased share of profits to the government and has fewer tax exemptions.
Niger is one of the world's largest producers of uranium and yet remains one of the poorest countries in the world.
Activists say it is about time Niger got a fair share of the mining profits.
Ali Idrissa is the national coordinator for Publish What you Pay (PWYP) Niger/ROTAB, a network of organizations that campaign for transparency and accountability in the mining sector. He said the signing of the contract is a promising step forward, but not enough.
"For more than five months, Areva has continued to refuse to apply the Nigerien mining law. Now, they have arrived at a deal, but we don't yet know what exactly is in the contract," said Idrissa, adding that "The government needs to respect the constitution and publish the new terms, and then apply the law to Areva, so that Areva's uranium extraction activities actually benefit our citizens."
Areva's previous mining contract, which was signed in 2001 and based on Niger's 1993 mining code, expired last year.
Under the old terms, the company was exempt from paying export duties on uranium, as well as from all customs duties and value-added taxes (VAT) on mining materials and equipment.
Under the new contract, Niger could see an increase in the rate of mining royalties from 5.5 percent up to 12 percent.
PWYP says that a decrease in VAT exemptions could increase tax revenues by between $13.6 million and $20.5 million per year.
Areva says it also plans to invest an estimated $160 million in local infrastructure projects.
However, the company, which has previously stated that the terms of the 2006 mining code are not profitable, says it will delay the start of production at its newest mine until the new terms become profitable.
The delay at the mine, which is expected to double Niger's current uranium output, could mean a significant loss of revenue for the government.
Alice Powell, the communications coordinator for PWYP, said only time will tell how the new deal benefits Niger's people.
"I think the key thing is, however, is when the contract itself is published and we can see all the details. We can see the extent of this and make sure and see what exemptions and concessions have been granted to see how much the government is really getting and the extent to which the mining code is being applied in full."
Powell said that Niger's constitution requires that the contract be made publicly available.
PWYP is calling for it to be published immediately.