Niger is presently the world’s third largest producer of uranium, after Canada and Australia, who hold 29% and 22% of the market share respectively.

However, in Africa, Niger is the premier producer, accounting for 45.5% of the continents share, followed by Namibia at 44% and South Africa with 9%.

This past July, the country’s holdings of the mineral have lead to significant tensions between Paris and Niamey.

Since the 1970’s, uranium in Niger has been solely exploited by one business partner - the French public company Areva. Run by Anne Lauvergeon, close advisor to the late French socialist president, François Mitterand, Areva has set up two joint-ventures, Somair and Cominak, with the Niger Government. The French company has been mining the Arlit site in the northern part of Niger since 1971 and is about to invest €1 billion (approximately US$ 1.35 billion) in a new mine, Imouraren, situated in northern Niger. The mines estimated reserve are close to 80,000 tonnes - a sizeable amount considering the 2006 global uranium production was around 40,000 tonnes while the worldwide demand was estimated at 66,000 tonnes. However, despite this new investment, Areva's monopoly in Niger has come to an end quite abruptly, a situation caused by two primary issues:

Firstly, the rising price of the commodity has made the business agreement between Areva and the Niger Government more fragile. Given the rise in worldwide demand for uranium, a number of companies have come knocking on the door of the Niger Government, including Australian, Canadian and Chinese companies who have all been lobbying for concessions. The first signs of the Niger Government courting new partners were in 2006 when the Teguidan Tessoumt concession was awarded to the China Nuclear Engineering and Construction Corporation. This site is believed to hold 12,000 tonnes of uranium and mining is scheduled to commence in 2010.

Secondly, the Niger Government has increasingly been putting pressure on Areva to re-negotiate the current contract before it ends in December 2007. Early this year, Prime Minister Seini Oumarou criticised the gap between the market price and the price paid by the French company. Despite this, the situation could have simply been just another business negotiation if a new Tuareg rebellion had not emerged in February 2007. The Tuareg rebellions were active during the 1980’s but ceased fighting in the early 1990’s after peace agreements were signed both in Mali and Niger (the Tuaregs live in the whole of the Sahara desert but concentrate mainly in these two countries). However, subsequent to this, the Tuareg rebellions have re-surfaced in both countries and the "Mouvement des Nigériens pour la Justice" (MNJ) attacked the Imouraren site in Niger, forcing Areva to take security measures. Among them, Areva recruited a former French Attaché of Defence in Niamey, Colonel de Namur, and worked with a former Tuareg rebel, Captain Agidar Mohamed, who had been integrated into the Niger army in the early 1990’s.

The situation stabilised and was deemed all right until July 2007, when a number of Chinese employees of the China Nuclear Engineering and Construction Corporation were kidnapped on 6 July. Following this, Agidar Mohamed turned to the rebellion with his men - an issue which led to the Niger Government explicitly accusing Areva of supporting the rebellious movement in order to prevent competitors in Northern Niger. The Chinese employees were released 9 days later but accusations and counter-accusations escalated between Niger officials and the French company. The Head of Security for Areva in Niger and the representative of the company, Dominique Pin, were even expelled from the country at the end of July. This forced the French Government to step in, with newly elected French President Nicolas Sarkozy, phoning his counterpart in Niger, Mamadou Tandja on 31 July. Following this, France’s Minister for Cooperation and Development, Jean-François Bockel, made a short trip to Niamey on 4 August. A compromise was then found with the Niger authorities, agreeing on 2 points:

a) The Niger President confirmed to his counterpart that, out of 20 mining rights that must be awarded, Areva will receive 5; and

b) The uranium price paid by Areva rose from € 41.62/kg to € 60.98/kg, valid from the beginning of 2007.

As such, what should have simply been a business disagreement came dangerously close to a diplomatic incident that was avoided at the last minute.

Based on these issues, one can conclude that:

1. The French monopoly vis-à-vis the uranium sector in Niger is over. As a result, the Niger market is now open and the French contract has been renegotiated under political pressure;
2. After the scramble for oil, the scramble for uranium has started in Africa - with Chinese companies already prospecting; and
3. Supposedly weak, African Governments are following a route not dissimilar to the modus operandi employed in the oil and gas sectors in South American countries. Just as Venezuela, Bolivia and Colombia did in 2005 and 2006, the African Governments are trying to renegotiate natural resources contracts and adjust them to better reflect market price - a factor which is sure to drastically change the monopolistic contracts signed in the 1970’s, much to dismay of the continents ‘traditional partners’.