Canada’s GoviEx Uranium (TSXV: GXU) entered into definitive agreements with the Republic of Niger to finalize the commercial terms to progress GoviEx’s flagship Madaouela uranium project in the West African country.
Under the terms of the definitive agreement, GoviEx’s subsidiary, GoviEx Niger Holdings, has to incorporate a Nigerien operating company to be named Compagnie Minière Madaouela SA. Once this is done, the Madaouéla I Mining Permit will be transferred to the new firm and Niger will receive a 10% free carried interest in its capital.
Niger will also receive an additional working interest of 10% in exchange for $14.5 million of claims due by the new company to the State comprised of the final $7.8 million Madaouela I Mining Permit acquisition payment and settlement of previously challenged three years of area taxes or $6.6 million between GoviEx and the State related to the Madaouela Project.
GoviEx, on the other hand, will be released from the payment of surface rights required under the Niger Mining Code. The payment of this right will be deferred until the earlier of the date GoviEx closes a financing deal for the construction of a mine for the Madaouela I Mining Permit or three years from the incorporation of the Madaouela Mining Company.
The Vancouver-based company will also be allowed to expand the Madaouela I Mining Permit to include the additional 5.96 million pounds (Mlb) U3O8 in the Measured and Indicated categories associated with the Miriam uranium deposit within the Agaliouk exploration permit that form part of the greater Madaouela Project.
“We believe the outlook for the uranium market is positive. The finalisation of the agreements represents a key step for GoviEx and Niger as we further develop the mine permitted Madaouela Project and it continues to illustrate the constructive environment that GoviEx has experienced operating in Niger since 2007,” GoviEx’s CEO, Daniel Major, said in a media statement. “Our work on the feasibility study continues as we focus on improving the project economics with confirmation test work currently underway targeting the reduction of operating and capital costs.”