Niger: CNPC Return Will Accelerate US-China Race for Niger's Resources

What happened: The Nigerien government reached a deal with CNPC to resume oil and gas operations and to boost investment in the sector.

Why it matters: Niger is making a political play to leverage the US-China rivalry by hoping to pique Trump's interest in the country's vast uranium reserves.

What happens next: Great-power competition over Niger’s resources will almost certainly worsen the investment environment for operators from other countries.

On 19 May, the Nigerien government announced that it had reached an agreement with the China National Petroleum Corporation (CNPC) and its subsidiary, West African Oil Pipeline Company (Wapco), to resume oil and gas production. The deal comes a year after production stalled in Niger amid accusations from the Nigerien military government that CNPC failed to comply with the country’s regulations.

The new arrangement will see two oil projects — Dinga Deep and Abolo-Yogou — relaunched, with CNPD investing $1bn to increase production from 110,000 to 145,000 bpd by the end of 2029.

In our view, this suggests that the military government, which has been aggressive in its approach to foreign operators since it seized power in 2023, is softening slightly in its stance to international investment. The course correction responds to the need to raise money, export uranium and garner security assistance.

The Financial Imperative

First, Niger needs a lot of cash to pay for its soaring military budget, which accounts for 14% of annual expenditure amid a raging jihadist insurgency. But President Abdourahamane Tiani was also likely motivated to make the CNPC deal because it is very good for Niamey.

For instance, the transit cost through an export pipeline that China has spent $5bn constructing will be cut from $27 to $15 per barrel, saving the state $106mn per year. Similarly, the Nigerien government will now take a 45% stake in Wapco. CNPC has also agreed to harmonize local and expat salaries and to redirect subcontracting to “benefit local Nigerien companies”.

Stuck Uranium

Second, Niger's difficulties in exporting uranium have been mounting in recent months. Despite nationalizing the Orano-operated Arlit mine and seizing stockpiles last year, it has struggled to export the uranium. The border with Benin is closed due to the dismal bilateral relations, while the route via Burkina Faso is threatened by jihadist attacks.

Additionally, landlocked Niger needs a port to export the uranium, which is far more difficult to smuggle than gold because it cannot be easily transported and it can only really be purchased by industrial operators. However, Orano’s court case against the nationalization of its mine resulted in a 2025 ICSID ruling that barred Niger from selling uranium from its mine. As such, Niger needs more international cooperation within maritime and financial clearing agencies than it currently has access to.

President Tiani is growing frustrated with this situation, not least since the uranium was nearly blown up during an Islamic State attack on Niger’s airport earlier this year. The resource is vulnerable and needs to be exported quickly.

Great-Power Competition

Third, Niger is also making a political play to leverage the heated rivalry between the US and China.

By making this deal with China, the government aims to deepen the bilateral relationship and that Beijing may be able to help it to export this resource more effectively. The main buyer for its seized uranium is Russia, which has had ships at Lome port in Togo waiting for the resource for weeks. Niamey is gambling that China may help Russia gain access to uranium — a move it may have only agreed to after CNPC resumed its oil and gas operations in Niger.

The Nigerien government is likely also calculating that it has an opportunity within its deal with CNPC to attract greater US interest. The Trump administration has become increasingly attentive to developments in the Sahel, aware that it is falling behind Russia and China in its involvement in this mineral-rich region. As such, the latest deal with China will almost certainly have piqued Trump's interest.

We believe Niger wants to flaunt its China deal to the US to encourage the Trump administration to engage similarly, possibly even as an alternative buyer for the uranium it currently has stockpiled. Importantly, the ICSID is headquartered in Washington, DC; heightened interest in Niger’s natural resources may prompt Trump to pressure the ICSID to lift its ban.

The US president is increasingly interested in Niger's uranium, both in terms of its own access but also because it wants to prevent it from going to Russia and Iran — which have previously reached agreements with Niger. As such, Trump is likely to be provoked by the latest deal between China and Niger into further talks with Niamey. The US government already signed a strategic health deal with the Nigerien junta earlier this year, the foundation for further engagement.

Impact for Foreign Investors

Greater US interest in Niger is likely to be accompanied by security assistance to further butter up President Tiani, who has probably factored this into his calculations as well: recent significant advances by JNIM in neighboring Mali have raised fears that Niger might be next.

Increased US security cooperation would take the form of enhanced intelligence and/or drone support, largely aimed at securing preferential access to resources going forward. We assess, however, that such a deal would not significantly reduce jihadist violence in Niger, though greater air assistance would protect Niamey from increasing attacks and stabilize the capital.

The increased efforts by China, Russia and the US to participate in Niger’s mineral and oil & gas economy — and the Nigerien government’s determination to play foreign actors off against one another — is not good news for investors from other countries.

Niger will act in an unpredictable fashion, granting concessions and access to minerals to the highest, most powerful bidder rather than honoring deals it had previously agreed with other foreign operators. We anticipate a high risk of concessions being revoked, with investors needing to maintain an extremely close relationship with President Tiani to protect their assets.