Shares of GoviEx, which has been operating in Niger since 2007, plunged more than 40% on Thursday, marking the largest drop in more than eight years.
According to the Wisdom Wealth App, GoviEx Uranium Inc., a Canadian-listed uranium mining company, saw its stock price plummet after its mining license was revoked by Niger's military leaders. As of Thursday's close, the stock fell 29.41% to 0.06 CAD.
Shares of GoviEx, which has been operating in Niger since 2007, plunged more than 40% on Thursday, marking the largest drop in more than eight years. The government wrote to the company saying it "no longer had the right to operate around the Madaouela mining license," causing the company's stock to fall.
Before GoviEx's license was revoked, Nigeria's military government last month decided to surrender the right of French nuclear group Orano SA to develop the Imoraren uranium mine.
Since Niger's political crisis last year, the country has established closer ties with Russia, paving the way for Russia to seek mining rights in the country. By 2022, Niger's uranium production will account for about 4% of global uranium production.
European countries, including France, are preparing to build new nuclear power plants as part of their strategy to reduce carbon emissions. Uranium prices have soared due to production problems in countries such as Kazakhstan.
GoviEx stated that "with the recent rise in uranium prices, the Madaouela project has been developing momentum, and despite changes in Niger's political situation after the coup, the company has begun to move forward." The company said the decision "did not comply with the withdrawal procedure prescribed by the applicable mining regulations."
Niger is one of the poorest countries in the world and expelled French troops last year, ending a decade-long security agreement with the United States. The US must withdraw its troops stationed in Niger by mid-September.
In April this year, 100 Russian military instructors arrived in Niamey, the capital of Niger, to train the Nigerien military on how to use air defense systems provided by Moscow.