Factbox: China's oil and uranium business in Niger

CNNC International

31/07/2023 10:02

By Andrew Hayley
       BEIJING, July 31 (Reuters) - China, Niger's
second-largest foreign investor after former colonial power
France, has in the past two decades ploughed billions of dollars
into the landlocked West African nation, mainly for the
exploration of oil and uranium. 
    Since last week's coup, in which military leaders detained
Niger's President Mohamed Bazoum and established a military
government, China says it is closely monitoring the situation,
and urges parties in Niger to safeguard stability.
    China's total foreign direct investment (FDI) into Niger
stood at $2.68 billion as at the end of 2020, according to the
U.S. Embassy in Niger. 
    Following are China's main investments in Niger,
predominantly by state energy giant PetroChina and national
nuclear firm CNNC:
    
    OIL ASSETS
        Niger became an oil producer in 2011 when the Agadem
oilfield, a joint venture between the government and PetroChina
 601857.SS , started production.
    PetroChina entered a production sharing agreement in 2008
with the Nigerien government to develop the field, located some
1,600km (1,000 miles) east of the capital Niamey, with estimated
reserves of 650 million barrels.
    As part of the deal, PetroChina invested in the construction
of the SORAZ refinery, located 460km away in the southern city
of Zinder, near the border with Nigeria. PetroChina holds a 60%
stake in the refinery, which has a capacity of 20,000 barrels
per day (bpd) and mostly supplies the Nigerien domestic fuel
market. The remaining share is held by the Nigerien government. 
    In September 2019, PetroChina entered into another agreement
with the Nigerien government to lay a 2,000-km (1,200 miles)
pipeline between the Agadem field and the Beninese port city of
Cotonou. 
    The pipeline investment is twinned with a second phase of
development of the Agadem field. Taken together, total
investment into the pipeline and second phase development is
expected to reach $4 billion, according to China's Ministry of
Commerce. 
    The pipeline, the longest of its kind in Africa, is planned
to mitigate the security and logistical challenges of exporting
crude from the troubled area, and designed to carry 90,000
barrels per day, according to China's Ministry of Commerce. 
    The project was 63% complete as of February this year,
according to a PetroChina statement. 
    PetroChina did not immediately respond to Reuters' request
for comment.
        In May this year, state oil and gas major Sinopec
 600028.SS  entered into a memorandum of understanding with the
Nigerien government paving the way for further potential
cooperation between Beijing and Niamey in oil and gas.
    
    URANIUM MINE
    In 2007, state-owned China National Nuclear Corporation
(CNNC)  601985.SS  entered a joint venture with the Nigerien
government to develop the Azelik uranium mine in the centre of
the country. 
    CNNC owns 37.2% of the project, with a further 24.8% owned
by Chinese investment entity ZXJOY Invest, according to a 2010
filing with the Hong Kong Stock Exchange. 
    The Nigerien government received a 650 million yuan ($90.93
million) loan from Chinese state-owned Eximbank to support
development of the project in 2009.
    The mine has estimated total reserves of 11,227 metric tons,
and annual production capacity of 700 tons, according to the
filing. The project was halted in 2015 due to unfavourable
market conditions.
    Niger, which has Africa's highest-grade uranium ores,
produced 2,020 metric tons of uranium in 2022, about 5% of world
mining output, according to the World Nuclear Association.
    CNNC did not immediately respond to Reuters' request for
comment.  
($1 = 7.1483 Chinese yuan renminbi)

 (Reporting by Andrew Hayley in Beijing and Aizhu Chen in
Singapore)
 ((Andrew.Hayley@thomsonreuters.com;))