AREVA and Niger: a lasting partnership
Ore extraction case file/studies and reports
After months of negotiation, the government of Niger and AREVA have reached a mining operation agreement for the Imouraren deposit. On Monday, January 5, 2009, AREVA Chairman Anne Lauvergeon and Nigerien Minister of Mining & Energy Mohamed Abdoulahi endorsed the extension of the forty-year-old AREVA/Niger partnership by signing the agreement and the statutes for the future Imouraren mining company.
The Imouraren deposit is the largest known uranium deposit in Africa, and the world’s second largest, after Australia’s Olympic Dam deposit. At a time when a number of countries are reviving their nuclear industries, this is a large-scale operation for both Niger and the group.
AREVA in Niger
A sustainable industrial approach:
AREVA established itself in Niger 40 years ago, and has remained its faithful partner even during the bad times.
Niger, staff deposits:
In the 1980s and 1990s, when the price of uranium was at its lowest and foreign companies were leaving the country, the group continued to exploit the deposits of Niger and continued to employ its 2,000 workers.
Important mining operations
During this period, AREVA accepted buying Niger’s uranium at a price far higher than market conditions. The agreement signed on 13th January 2008 between AREVA and the Republic of Niger confirms the group’s position of local mining operator for the coming four decades, and plans the exploitation of the Imouraren deposits, which will be the biggest uranium extraction project ever set up in Africa. AREVA will create 1,350 direct jobs and a great many more indirect jobs in consequence.
A win-win partnership
AREVA buys uranium extracted on site from companies of which the Republic of Niger is a shareholder and from which it receives dividends. Some of this uranium also goes back to Niger’s authorities.
99% of AREVA’s staff in Niger is from the Niger.
For several decades the company’s subsidiaries, COMINAK and SOMAIR, have been organizing important health and development programs (building schools, local economic development, training for disadvantaged young people) in Arlit region.
An authentic health policy
As soon as it was established in Niger, AREVA attached great importance to setting up and funding the running of health structures around its sites. The hospitals which were thus created comply with the strictest French standards, and perform 200,000 health procedures annually for free (in other words 15% of the country’s health expenditure).
The hospitals have helped significantly improve the state of the population’s health. Furthermore, they were audited in 2005 by an independent French auditor, which confirmed the quality of these medical structures.
Highly supervised work conditions
Working conditions at AREVA’S sites in Niger comply with the strictest standards, the same ones that apply in Canada or Kazakhstan. Moreover, in terms of safety, the results from both mines are excellent – from October 2006 to December 2008, the frequency level of accidents with sick-leave was 0 for SOMAIR and 2.1 for the whole activities in Niger in 2009 (it is almost 26 in the paid-work sector in France).
An environmentally responsible policy
AREVA regularly carries out or commissions safety and environmental audits. In 2004 and 2005, the group requested that the IRSN (the French public experts in matters of safety and radioprotection) carry out several studies on its environmental management. The IRSN concluded that the environmental management systems of both companies were coherent and complied with international standards.
In all, AREVA is engaged in sustainable development actions in Niger planned over the next five years worth more than €6 million per year (i.e. FCFA 4 billion/year).
What are the assessed aspects during the validation process?
The decision of granting the mining license for the Imouraren deposit was made only after many intense years of geological surveying and mining development studies. This approach led up to the realization by AREVA teams of a feasibility and an environmental aspects studies submitted to the Nigerien government for approval. These studies are the final step of a thorough regulatory process to assess the project’s industrial, social and environmental aspects, including a number of work sessions with the Ministries – among which, a five-day public hearing in Agadez. The AREVA teams were able to demonstrate their accountability and expertise. After a framework agreement was reached in January 2008, AREVA worked with the Nigerien government to determine the “win-win” terms for the partnership, finalize the statutes for the future mining company and decide on the terms of a 20-year mining agreement at least .
It is the biggest industrial project ever planned in Niger and the world’s second-biggest open pit mine, which has been operating jointly by AREVA and Niger for nearly forty years. The decision was certainly worth nine months of deliberation and discussion. Taking this long to work things out is a sign of the excellence of this partnership.
What does the economic relation between AREVA and Niger account for?
The development of Niger’s natural resources, from raising livestock to extracting raw materials, accounts for a large share of the country’s economy and considerably contributes to the state budget.
In 2009, the group extracted 3,243 metric tons of uranium – about 6% of the world’s production – from Somair and Cominak, its two mining sites at Arlit.
For AREVA, Niger represents about 27% of its current annual production, while the state of Niger derives substantial financial benefits from the primary export of the country (62% of exports). Starting Imouraren operation, which will double as a minimum future production of the country, the contribution of mining activities to the Nigerian economy will be larger.
Does the emergence of new mining companies have an influence on the partnership between AREVA and Niger?
AREVA has been Niger’s loyal partner over the past 50 years and the emergence of competing companies will provide a comparative viewpoint on the group’s performance in Niger. As uranium prices plummeted in the 1980s and mines were closing all over the world, the group continued to develop Niger’s deposits alone, when all the other global investors were pulling out.
The group’s commitment provided a living to 2,000 Nigerien employees and their families – more than 20,000 people in all.
Now that the uranium market is picking up, it is only natural that Niger has decided to diversify its partners. Since 2006, it has granted more than a hundred exploration licenses to foreign companies – mainly Chinese, Canadian, Indian, South African and Anglo-Australian. Niger needs to develop, and its natural resources should serve that purpose. So, Nigerien authorities are acting in the national interests. The agreement concluded between Niger and AREVA does show, however, that the group remains an industrial reference for the country.
AREVA is already implementing solidarity projects with local population to the tune of six million euros per year over the next five years. Will Imouraren add to this amount?
AREVA will continue to step up its socio-economic development policy in Niger. The projects currently under way focus on promoting health, education/training, transportation, and access to water and energy for the local population. Operations at Imouraren will help reinforce the funding capacity for regional community projects.
Are the group's economic repercussions generated by mining operations of benefit to the local population?
AREVA aids Niger both by promoting socio-economic development at the national level through the mining royalties paid, and locally. This is an ethical duty consistent with the values shared groupwide. AREVA supports the national project to fight poverty and reduce the food crisis, though its regional programs in the areas around its sites by contributing 17 million euros over five years to the water and irrigation research project on the Irhazer Plain.
The expectations of the population and the communities are, frankly, huge. The approach proposed by the group has been structured yet pragmatic. AREVA has planned a gradual roll-out of projects that the group deems to be sufficiently structured, without interfering with operations that were launched back in the 1960s by the group’s two mining companies (free hospital care, aid for water, electricity, and building schools, etc.). All this amounts to about six million euros per year over the coming years.
These projects have involved further basic-needs actions in the areas of health, education and culture, and a co-development initiative to set up a bilateral orientation committee and a development fund to encourage initiatives from newly decentralized local governments and from rural and urban districts as Arlit. This strategy has become a reference for developing other regions in Niger.
To give one specific example, AREVA initiated a partnership between the Nigerien government and a private association, ESTHER, to develop an HIV/AIDS testing and treatment program in Northern Niger.
In the area of education, AREVA is financing training for 70 engineers and technologists over the next five years at EMIG, an engineering school in Niamey, the renovation of the Aïr Mining School (Emaïr) in Agadez, and training for more than 200 equipment operators to prepare for the Imouraren project. For three years (2007/2009), AREVA also sponsored the creation of a vocational training center for bread-making in partnership with French children’s aid committee CFSE. The center will train 32 unemployed youths, and help them return to work.
Projects for the next few years involve aid for socio-economic development and job creation. The electrification project for Arlit’s shantytown areas is one example of an experimental public/private/associative partnership to enable local socio-economic development through micro-jobs. With the help of Crédit Mutuel, the project was aided by a microcredit program. To help out new businesses, AREVA has signed a partnership with SINERGI, a venture capital company of which AREVA is a member. This partnership helps reinforce action undertaken by the group to help set up enterprises and develop economic potential.
Is the development of a new mine in the northern region of Niger compatible with traditional economic activity?
While the inflow of a potentially large number of new mining stakeholders would surely be a source of industrial jobs, a financial boon and a stimulus for development, it could also engender significant cultural and socio-economic disparities at the local level. AREVA has heard spokesmen from the different communities express their legitimate desire to continue to pursue their herding, nomadism, market gardening and touristic activities, and not see them die out. But without water, these cannot develop in such an arid region, and neither can industry.
The hydro-geological exploration carried out in a limited area around Imouraren over the past two years has led to the discovery of 7.8 billion cubic metes of connate water in the aquifers (more than 30% of this is non-potable). This would indicate considerable water resources at the catchment scale. Establishing an inventory of the quantity and quality of this non-or-nearly non-renewable resource and a water use plan remains to be done. The Nigerien government is willing, but the cost is so high that international aid would be indispensable.
So, the renewed interest in uranium could become a real development opportunity for Northern Niger; making it happen, however, will require a bona fide regional development plan that factors in solidarity.
What are the mining conditions in AREVA's Nigerien mines?
They are exactly the same as those in the group’s other mines in Canada, Kazakhstan, or formerly in France. AREVA’s Nigerien subsidiaries are proud of their accident rate in 2009 (or frequency rate), which is more than twelve times lower than the average rate for global industry in France. In December 2008, a company like Somair has been operating for two years without a single occupational accident resulting in employee sick leave: it is, on a sub-area wide scale, an exceptional result.
Furthermore, the group monitors its operations with all due diligence. In the workplace, the employees are provided with the adequate personal protection equipment and are monitored by the work inspection services. AREVA provides radiation protection to a standard higher than required by Nigerien regulations or even by the latest international standard, as it sets a maximum threshold at 18mSv/year instead of the recommended 20mSv/year. Workers are subject to regular dose monitoring and health inspections, and more than 30,000 measurements are taken each year at the two sites to monitor the radioactive impacts.
What is the weight of public health issues in the group's mining policy?
AREVA is very mindful of that. In spite of all the independent analyses and surveys in recent years demonstrating that there is no danger for the local populations, the fears have not all gone away. AREVA understands that uranium mining and radioactivity do raise such fears. The questions people ask are legitimate, and the AREVA responds to them.
Because AREVA considers itself duty-bound to respond in an irreproachable manner, the group has created health “observatories” around all its current and former mining sites. Their purpose is to monitor former employees and the local populations to determine the health impacts of uranium mining on their biological systems. This spearhead program will be under the government’s responsibility. It will involve the participation of scientific bodies and NGOs, including some of AREVA’s former critics. These innovative structures will provide the group with a multipartite view of uranium’s health impacts, which hopefully will dispel the remaining fears on the subject.
What measures does AREVA take in favor of environmental protection?
The potential impacts of Imouraren operations were examined in a 1,000-page study, which was submitted to Niger’s local populations and authorities in May 2008 and approved by them. AREVA even received a certificate of environmental compliance, without which the operating license would not have been delivered.
Somair and Cominak are currently the only companies in Niger that are certified for ISO 14001. The environmental monitoring procedures are subject to a specific action plan. The water, air, food chain, soils and environment are monitored regularly under the oversight of the Nigerien government. Hundreds of measurements are taken each year, and resource saving plans have been set up, notably for water. To prevent any risks from taking away contaminated products, AREVA's mining companies are keeping materials like tooling and rebar under closer scrutiny, and are cooperating with the mining ministry to keep all contaminated rebar away from public land.
Mines are often considered as a source of impermanent activities. AREVA’s goal is to ensure that the mine will be a source of long-lasting wealth and development, and all of the group’s teams are guided by that goal.
Niger key figures
Niger is located at the junction between West and Central Africa and the Sahara. The terrestrial communications crossroads between the north and south, Niger is wedged between Burkina Faso and Mali to the west, Algeria and Libya to the north, Chad to the east and Nigeria and Benin to the south. The country covers a total area of 1,267,000 km2 and the borders it shares with these countries are over 5,700 km long.
August 3rd, 1960.
Niger has a population of approximately 14,000,000. Zarma-Songhais, Peuls and Gurmas reside in the west and in the Niger River valley, Hausas, Kanuris, Toubous, Arabs and Peuls inhabit the central and eastern zones and Tuaregs, Arabs and Peuls live in the north. The population growth rate is one of the highest in the world (more than 3% every year).
Nigeriens are predominantly of the Muslim faith (95%).
French (the official language of Niger), Haus, Zarma, Songhai, Tamajak, Fulfulde or Fula, Kanuri, Toubou, Arab and Gurma.
By activity sector:
- agriculture: 39% (millet, sorghum, black-eyed peas, rice, peanuts, cotton, etc.)
- industry (including mining): 17%
- services: 44%
GNP per capita in 2008: €250
FCFA (African Financial Community franc): €0.15 = FCFA100