Orano’s income has been affected by the situation in Niger, with logistical issues continuing to cause blockages to uranium sales. But the group has confirmed its financial outlook for 2024, targeting stable revenue and a positive net cash flow, and says it still wants to talk to the government about continuing the Imouraren project.
“At the end of June 2024, the group is in line with its development roadmap and notes the deteriorated situation affecting mining operations in Niger, connected to the evolving local geopolitical context, while ensuring its delivery commitments to its customers,” CEO Nicolas Maes said in the French group’s half-year results announcement on 26 July.
“In a favourable nuclear market, the group has confirmed its end-of-year outlook which consists of continuing to reduce its debt while accelerating its investment programme,” he said, adding that the company’s teams “are working hard on the construction of the nuclear industry of tomorrow” as well as on new activities in nuclear medicine and the battery value chain.
Orano’s operating income of EUR12 million (USD13 million) reflected the “deteriorated condition of mining operations in Niger”, the company said: for the same period in 2023, operating income was EUR260 million. However, it has confirmed its financial outlook for 2024 with revenue stable around EUR4.8 billion, and a positive net cash flow.
Niger’s uranium industry – and France’s involvement in it – dates back more than 50 years. Currently, Orano produces uranium from open-pit operations at SOMAÏR (Société des Mines de l’Aïr), near the town of Arlit, which is 63.4% owned by Orano and 36.66% owned by Sopamin (Sopamin manages Niger’s state participation in mining ventures). It is also carrying out remediation of the former COMINAK underground uranium mine, where over 40 years of production came to an end in 2021.
The events of 26 July 2023 – when then-President of Niger Mohamed Bazoum was deposed in a coup d’état – led to an interruption, for several months, in the import of critical reagents such as soda ash, carbonate, nitrates, sulphur, and other parts and products necessary for SOMAÏR’s activity, Orano said in its earnings release. “Since then, Orano’s teams have remained committed to finding new supply corridors and ensuring business continuity. This mobilisation enabled the resumption of production at the Somaïr ore processing plant in the first quarter of 2024 after several months of early maintenance, as well as the continuation of ore extraction at the mine. However, Somaïr’s sales were unable to resume due to a lack of logistics solutions approved with the Niger authorities.
“While the security of supply for Orano’s customers remains ensured thanks to the diversity of its supply sources, this blockage is placing Somaïr in financial difficulty and weighing on its ability to continue its operations.”
The operation has survived up to now by selling stocks that had been earmarked to finance the eventual rehabilitation of the SOMAÏR site at the end of its life cycle – expected in the 2040s – Maes told investors. However, that stock is now almost completely used up, and the cash coming from the sale of remaining stocks will now be used to preserve the operation itself, and paying the wages of the workers there, until a solution can be found to enable the Orano to resume uranium exports.
Imouraren update
Orano also said it intends to pursue a dialogue with the Nigerien state following the withdrawal by the authorities of the operating permit for the Imouraren uranium mine. Imouraren SA – 66.65% by Orano Expansion and 33.35% by Sopamin and the State of Niger – was awarded an operating permit to mine the deposit in 2009, but development was suspended in 2015 due to the market conditions at the time.
With current market conditions making it possible to once again consider commissioning Imouraren, Orano earlier this year submitted a technical proposal for the development of the project to the government. In mid-June, the company said it had restarted preparatory activities at the site, where it envisaged carrying out in-situ leach mining operations. But days later – on 20 June – the company announced that the State of Niger had decided to withdraw Imouraren SA’s licence to exploit the deposit, placing it back in the public domain.
Orano said in its update that it “has acknowledged” the Nigerien authorities’ decision. “Orano’s priority is to protect its rights and establish a dialogue with the State of Niger to continue this project,” the company said.
The company has started the legal procedures to protect its rights at Imouraren, Maes told investors. It has submitted an application for may also submit an application for a new operating permit.
Although Niger accounts for 4% of global uranium production, the loss of the country’s output was immediately offset by uranium production in other countries, particularly in Canada and Kazakhstan, Maes said. For Orano, Niger represents around 15% of Orano’s uranium supplies, but that the situation in Niger is not endangering nuclear fuel supplies in France and the company will continue to meet its delivery commitments, he added.
Source: World Nuclear News
