Thousands protest against Areva in Niger mining town

Sat Oct 12, 2013 3:21pm EDT

* Niger auditing Areva mines to cut costs, increase revenue

* Arlit residents say have benefited little from mining

* Company declines to comment

By Abdoulaye Massalaki

NIAMEY, Oct 12 (Reuters) - Thousands of residents of the remote mining town of Arlit in Niger took to the streets on Saturday to protest against French uranium miner Areva and support a government audit of the company's operations in the desert nation.

Niger announced the audit last month to determine cost reductions in a new long-term contract and wants to dramatically increase the state's revenues from the Cominak and Somair mines, in which Niger holds a stake of over 30 percent.

Ten-year contracts for mines in northern Niger expire at the end of the year. The two mines produce some 4,500 tonnes of uranium per year and account for roughly a third of the state-controlled French company's total.

Around 5,000 demonstrators marched through Arlit chanting slogans against the French mining company before holding a rally in the city centre, participants and protest leaders said.

"We're showing Areva that we are fed up and we're demonstrating our support for the government in the contract renewal negotiations," Azaoua Mamane, an Arlit civil society spokesman, said in an interview with a private radio station.

Areva, which has been mining Niger uranium for four decades, has a 63.6 percent stake in Somair and 34 percent in Cominak. But Arlit residents complain they have benefited little from the local mining industry.

"We don't have enough drinking water while the company pumps 20 million cubic meters of water each year for free. The government must negotiate a win-win partnership," Mamane said.

Areva spokesmen in Niger and Paris declined to comment.

Extractive industries watchdogs, including the local branch of Publish What You Pay, have accused Areva of a lack of transparency in how it reports revenues and costs in Niger.

France's ambassador told Reuters last week the audit had been decided by common agreement between Niger and Areva, which he said would serve as a base for the renegotiation of financial conditions and tax rates under the new contracts.

It is due to be completed by the end of October, he said.

France relies for roughly three quarters of its electricity on nuclear reactors, which Areva builds and supplies with fuel. International uranium prices, however, have slumped after the 2011 Fukushima disaster in Japan, squeezing Areva's earnings.

The company, 87-percent owned by the French state, made a loss of 99 million euros last year, but expects to make an operating profit of more than 1.1 billion euros this year, helped in part by its uranium mining business.

Niger is calling upon the company to make infrastructure investments, including resurfacing the road between the town of Tahoua and Arlit, more than 1,000 km north of the capital Niamey - known as the "uranium road". (Additional reporting by Sybille de La Hamaide in Paris; Writing by Joe Bavier; Editing by Alison Williams)