UraMin fraud allegations surface in Paris daily

PARIS – Controversy over Areva’s US$2,5 billion purchase of uranium miner, previous owner of Trekkopje, has grown after a consultant said the French state-owned company may have been the victim of a fraud.

The nuclear energy group has launched an internal enquiry into the 2007 deal after a drop in world uranium prices and disappointing results at UraMin’s mines in Africa forced the group to take U$2,4 billion of charges on the unit.The backlash of the UraMin deal also forced Areva to halt further investment in the Trekkopje uranium project in Namibia.Marc Eichinger, a consultant who said he was commissioned by Areva to produce a confidential report on the deal, on Friday told French newspaper Le Parisien the takeover was made in ‘very dubious’ conditions.’Areva had nothing to do with UraMin, a company that had no production or proven reserves,’ said Eichinger, the founder of Assistance Petroleum International Capital, a consultancy based in Sciez on the French-Swiss border.Areva declined to make any comment on the interview, only saying the supervisory board expected the findings of an internal investigation by the end of February.Two sources at Areva, who declined to be identified, said they knew nothing about Eichinger’s report.Eichinger, who did not return calls by Reuters, said the fraud could have been facilitated by some executives at Areva, without citing names.He said Areva made the acquisition on the basis of information provided by a company paid by UraMin, instead of sending its own experts to evaluate the potential of UraMin’s mines.At the time, Areva said it expected UraMin’s deposits in South Africa, Namibia and the Central African Republic to produce around 7 000 tonnes annually from 2012.’I have no doubt that UraMin has been a very bad deal for Areva, but once this is said, there is nothing more to add to it. Many people have tried to demonstrate this was a fraud but so far no one has brought the proof that it was,’ said a source who has direct knowledge of the situation.WRITEDOWNSRene Ricol, who was asked by French President Nicolas Sarkozy to look into Areva’s accounts in 2010, told Reuters his audit led to Areva taking a 400 million euro charge on UraMin and a mention in the group’s accounts that unpromising chemical tests on the Trekkopje in Namibia could lead to new writedowns.But Ricol said he did not investigate the deal itself.’Several people have alerted me on this issue, but I am not a police officer or a judge. I am an accountant. If one has elements pointing at a fraud, one has to bring them to the prosecutor,’ Ricol said.The Paris prosecutor’s office said there was no investigation underway on fraud allegations.’Areva has not filed a suit so there is no investigation underway,’ a spokesman said.NO INVESTIGATIONThe new development comes soon after Areva’s former boss Anne Lauvergeon filed a legal suit after discovering a confidential report by private investigators on whether her husband, a business consultant, had illegally benefited from the UraMin acquisition.It also comes against a background of a highly charged atmosphere at Areva surrounding the abrupt replacement of Lauvergeon in June 2011.Lauvergeon was replaced by her former number two Luc Oursel after she came under fire for cost overruns at a project in Finland, the loss of a huge deal in Abu Dhabi and a public spat with Henri Proglio, the head of state utility EDF.Dubbed ‘Atomic Anne’ or ‘Madame Mon’ by French media for her feisty personality, Lauvergeon was a polarising presence during her ten-year tenure, drawing fierce criticism from some quarters as well as admiration from others.Areva has suspended the payment of a 1,5-million-euro severance payment to Lauvergeon pending the outcome of the UraMin investigation.The UraMin deal was made at a time of booming demand for enriched uranium, and a battle among mining players to secure access to new reserves, as high oil prices and concern about global warming was leading to a global nuclear renaissance.Since then, the accident at the Fukushima Daiichi plant in Japan, the worst nuclear disaster since Chernobyl, has led several countries to shelve their plans – pushing uranium prices sharply lower.At the time of the deal, some analysts said the price for UraMIn – a 21 per cent premium – was steep but none questioned that the purchase would bolster Areva’s mining portfolio.- Nampa-Reuters