In Mauritania, Australian company Aura Energy is set to write a new chapter in the country's mining history with the development of the first uranium mine in Tiris, in the north-east of the Mauritanian Sahara. Scheduled to start by the end of 2025, with production expected in 2027, this initiative comes at a time when global sentiment towards nuclear energy is favourable, marked by a recovery in uranium prices and renewed interest in this carbon-free energy source. However, logistical, financial and contractual challenges could complicate the implementation of this ambitious project.
The Reguibat Shield, located in the Mauritanian desert, has been known for its uranium potential since the 1960s. In 2008, Aura Energy, initially searching for gold, detected a radiometric anomaly revealing uranium deposits in the Tiris Zemmour region, 1,400 km from Nouakchott. "We identified uranium and began work, but the 2008 global financial crisis, followed by the Fukushima accident in 2011, caused uranium prices to plummet, making financing difficult," explains Andrew Grove, CEO of Aura Energy and former executive of Orano's Australian subsidiary. With estimated resources of 91.3 million pounds of uranium oxide (U3O8), the Tiris project could produce 2 million pounds per year over 25 years, according to a 2024 feasibility study, with an option to expand to 4 million pounds.
The Tiris project is benefiting from favourable market conditions. Uranium prices, after peaking at $100 per pound between December 2023 and January 2024, are expected to climb to $150 by 2027, driven by growing demand for nuclear energy, which is seen as a carbon-free solution to climate change. After decades of hesitation, the World Bank is once again supporting the financing of nuclear projects, a boon for initiatives such as Tiris. In addition, many uranium mines around the world are reaching the end of their life, reinforcing the appeal of new deposits such as those in Mauritania.
The Tiris deposit offers competitive advantages: it is shallow (3 to 5 metres), allowing for open-pit mining using free-digging methods, reducing operating costs to $35.70 per pound of U3O8, according to the feasibility study (auraenergy.com.au). With an initial investment of $230 million and an expected return on investment in 2.25 years at a price of $80 per pound, the project has a net present value (NPV) of $499 million and an internal rate of return (IRR) of 39%.
Despite these prospects, Aura Energy faces significant obstacles. The company, which has obtained all necessary permits, including authorisation from the National Radiation Protection, Safety and Security Authority (ARSN) in July 2024, is seeking to raise $230 million to reach a final investment decision (FID) by the first quarter of 2025. Discussions are underway with a Western development bank for a loan covering 50-60% of the costs, but, as Teva Meyer, an expert in nuclear geopolitics, points out, "Aura Energy has not yet signed purchase agreements with nuclear reactor operators, a crucial step in reassuring private investors about the commercial viability of the project."
An off-take agreement exists with Curzon Uranium, signed in 2019, for 800,000 pounds of U3O8 over seven years, with an option for an additional 1.8 million pounds. However, additional contracts with reactor operators are needed to secure financing. Aura Energy is working with Orimco and Macquarie Capital to structure a financing package combining debt and strategic investors, potentially including a direct equity stake in the project.
The lack of logistics infrastructure for radioactive materials in Mauritania is another challenge. Yellowcake, the final product of the processing plant, will be packaged in secure steel drums and transported by truck 1,400 km to the port of Nouakchott via a desert track and a partially paved road. " No uranium or radioactive material currently transits through Nouakchott, which means that new administrative procedures will have to be put in place and specialised shipping companies will have to be found," notes Teva Meyer. The planned volumes, although modest (1,000 tonnes of U3O8 per year), may not be attractive enough for specialised maritime transport companies, making the trade potentially costly.
However, Aura Energy has hired an international company specialising in the transport of radioactive materials to deliver the yellowcake to international converters. A 6.2 MW hybrid diesel-solar power plant, including 2.1 MW of solar power, will supply the site, while a camp to accommodate 200 people will be built 3 km from the plant.
With significant expansion potential, particularly thanks to newly identified areas at Hippolyte South and Sadi, Aura Energy could consider selling the mine to a larger operator, such as French giant Orano, with which Andrew Grove is very familiar. "The Tiris project could attract major players seeking to diversify their uranium sources in a context of geopolitical tensions, particularly with Niger and Kazakhstan," suggests an industry analyst. Mauritania, with its mining-friendly government and a state stake of up to 20%, offers a stable framework for such partnerships.
The Tiris project could position Mauritania as West Africa's second-largest uranium producer, behind Niger, and diversify its economy, which is currently dominated by gold and iron. With an initial lifespan of 25 years and estimated revenues of $2.25 billion at $80 per pound, Tiris represents a major economic opportunity. However, its success will depend on Aura Energy's ability to secure off-take agreements, overcome logistical challenges and secure full financing.
In the context of a global "nuclear renaissance," driven by projects such as the agreement between Constellation Energy and Meta to power data centres from 2027 onwards, Tiris could benefit from growing demand. But for now, the small Australian company faces significant challenges in transforming this modest resource into a commercial success.