Geopolitical Risks in African Energy Sectors: How Arbitrary Detentions Threaten Multinational Firms' Stability

Africa's energy sectors, rich in oil, uranium, and minerals, have long been a focal point for global investors. However, recent years have seen a surge in geopolitical risks that now imperil operational stability and investment appeal for multinational firms. Arbitrary detentions of foreign workers, coupled with resource nationalism and shifting geopolitical alliances, are reshaping the calculus for companies operating in resource-rich nations like Niger, Mali, and Cameroon.

The Niger Uranium Crisis: A Case Study in Resource Nationalism

The seizure of French uranium giant Orano's operations in Niger since 2023 exemplifies the escalating tensions. Following a military coup in 2023, Niger's junta accused Orano of over-extraction and mismanagement, leading to the nationalization of the Somaïr mine, a critical source of Niger's uranium exports. By June 2025, the junta detained Orano's managing director, Ibrahim Courmo, and blockaded its offices—a move Orano condemned as “arbitrary and illegal.”

The fallout has been severe. Orano halted operations, repatriated staff, and filed international arbitration claims. For investors, the stakes are clear: Niger supplies 5% of global uranium, critical for European nuclear power. Disruptions here ripple through supply chains, as seen in the 20% surge in uranium prices since late 2023 ().

A Region in Flux: From Mali to the Sahel

Niger's actions mirror broader trends across the Sahel. In Mali, the expulsion of French troops in 2022 preceded aggressive moves against Western firms. Resolute Mining, for instance, faced executive detentions that forced a $160M settlement with the Malian government over gold mine control. Such tactics have become a tool for regimes to renegotiate resource contracts, often at the cost of foreign worker safety and investor confidence.

The geopolitical pivot is undeniable. Sahel nations like Mali and Niger now align with Russia's Wagner Group and Turkey, seeking alternatives to Western influence. For oil and mining firms, this means heightened risks of expropriation and detention, as seen in Cameroon's crackdown on opposition leaders and Tanzania's bans on political parties.

Why This Matters for Investors

1. Operational Instability: Detentions and nationalizations disrupt production. Orano's uranium output dropped 30% in 2024 due to Niger's seizures, directly impacting revenue.
2. Legal and Financial Risks: Multinationals face prolonged arbitration battles. Orano's case, ongoing since 2024, underscores the years-long delays and costs of resolving such disputes.
3. Supply Chain Volatility: Uranium disruptions in Niger could force European utilities to seek costlier alternatives, squeezing margins for energy companies.

Orano's stock has underperformed peers since 2023, reflecting investor wariness over geopolitical exposure.

Investment Strategies for Navigating the Risks

1. Diversify Geographically: Shift focus to politically stable African nations like Senegal or Kenya, where democratic institutions are stronger.
2. Prioritize Local Partnerships: Companies with joint ventures involving state-owned entities or local firms may face fewer expropriation risks.
3. Monitor Geopolitical Shifts: Track alliances with non-Western powers (e.g., Russia, China) and their impact on resource contracts.
4. Due Diligence on Contracts: Ensure agreements include clauses for arbitration under neutral treaties like the International Centre for Settlement of Investment Disputes (ICSID).

Conclusion

Africa's energy wealth remains a magnet for investors, but the Sahel's resource nationalism and arbitrary detentions have introduced new layers of risk. For multinationals, the path forward demands rigorous risk management, geographic diversification, and a keen eye on shifting geopolitical loyalties. As the Niger crisis shows, failing to account for these factors could lead to stranded assets—or worse, stranded executives.

Investors must weigh the region's resource potential against its escalating instability. Those who do so strategically will thrive; those who don't risk becoming collateral damage in a geopolitical game with no clear end.