Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
French Foreign Minister Catherine Colonna heads to Mongolia on Wednesday aiming to push a potentially €1 billion uranium deal for nuclear group Orano that Paris hopes can be concluded in the autumn, French diplomatic sources said on Wednesday.
President Emmanuel Macron stopped off in Ulaanbaatar in May on his return from a G7 summit in Japan, saying that the two countries had agreed to work together to boost French energy sovereignty through the supply of critical metals from Mongolia.
“Mongolia is full of resources and resources that aren’t sufficiently exploited, and not all identified,” a French diplomatic source told reporters ahead of Colonna’s visit.
“There is one major project, which is an Orano project that aims to exploit uranium mines,” the source said. “It is … worth more than 1 billion euros ($1.1 billion) and enables the extraction of a large quantity of uranium.”
“It’s advancing well, and there is an agreement that is being negotiated with the objective to conclude by next autumn.”
According to the company’s website it and its partner, Mongolian state-owned Mon-Atom, are working with Mongolian authorities on an investment agreement for the Zuuvch Ovoo project, one of two for which their Badrakh Energy joint venture received mining licenses in 2015.
Orano confirmed the project in question was Zuuvch Ovoo and said in an emailed response to Reuters that negotiations were ongoing and that the company aimed to develop the first uranium mine in Mongolia, “applying the highest standards in terms of health, safety and the environment, as well as social responsibility.”
Orano, a major uranium producer with mines in Canada, Kazakhstan and Niger, has been in Mongolia for more than 25 years, carrying out exploration activities, its website showed.
Nearly 80% of Mongolia’s total exports go to China, but the mineral-rich country is working to expand trade and mining relationships beyond its two big neighbours China and Russia and hopes to become a bridge between Europe and Asia.
Mongolia is home to major deposits of rare earth minerals, which are essential to many high-tech manufacturing processes and are used in electric vehicles, wind turbines, portable electronics, microphones and speakers.
“There will be other meetings to see what we can do to identify resources and prepare possible exploration cooperations,” the diplomatic source said.
($1 = 0.9142 euros)
(By John Irish and Benjamin Mallet; Editing by Jan Harvey and David Evans)
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