Orano - Annual Activity Report 2024 70 3 RISKS, CONTROL AND DUTY OF VIGILANCE PLAN Risk factors Geopolitical risk may, among other things, lead to actions of foreign influence or interference to the detriment of French or Orano’s interests or to the benefit of its competitors, which could result in a loss of market share for the group. Political pressure in particular could lead some of our competitors, closely linked to foreign powers, to take decisions influenced by considerations other than economics and to benefit from financing on advantageous and non-market terms. Acts of terrorism, whether domestic or imported, can also generate socio-political unrest and compromise the physical safety of the group’s employees and facilities. Weak public governance and the rule of law expose the group and its employees to the risk of corruption, inadequate protection of their rights and unfair treatment by the judiciary. In addition, economic sanctions regimes, associated with export controls, may target the countries in which Orano operates and impose restrictions on the import, export and re-export of certain goods and services. Risk management measures Orano constantly monitors political and geopolitical risks. All transfers of materials, equipment, information and/or technology are governed by commercial contracts and intergovernmental agreements. Orano, in conjunction with its authorities, ensures, through its internal procedures, compliance with treaties, agreements, international rules, export regimes and sanctions regimes. Orano regularly informs its employees of the risks incurred, sets up ad hoc committees to better assess and anticipate these risks and take decisions accordingly. Situation in Niger (1): since the events of July 26, 2023 in Niger and the closure of the main supply and export corridor, Orano has attempted to have Somaïr (the mining company, 63.4%-owned by the group, operating the Arlit uranium mine) set up safeguard measures to maintain industrial equipment, full employment and compensation of all employees pending a resumption of full production. All the proposals made by Orano to the Niger authorities to find alternatives for exporting the uranium produced by Somaïr remained unanswered. However, in December 2024, Orano noted the loss of control of its Niger subsidiaries. The decisions taken at the Company’s Board meetings are no longer implemented, and Orano noted that the Niger authorities have taken operational control of Somaïr. The ongoing production costs at the site are further deteriorating the Company’s financial position. In this environment, the implementation of the resolution adopted by Somaïr’s Board of Directors on November 12, 2024 to suspend expenditure on production activities in order to prioritize the payment of salaries and preserve the integrity of the production plant has been deliberately prevented. Niger’s representatives have taken up this position, which they defended at the Ordinary Board of Directors meeting held on December 3, 2024, confirming in particular their refusal to export production. As far as Cominak is concerned, the persistent refusal of the Niger part to participate in the duly convened Board meetings and this, until Orano Mining has not yielded to the pressure exerted on the appointment of a Chairman of the Board of Directors imposed by the Niger government, in violation of the applicable rules of governance and OHADA law, against the opinion of Orano Mining, shows that the Niger government has taken over the rights attached to the majority holding of voting rights. Sanctions against Russia: as sanctions are increasing, they require the group to pay increased attention to the risk of being subject to trade sanctions that could have particularly negative financial, criminal and reputational impacts. Orano does not carry out any activities in Russia or Ukraine, and does not have any local establishments or employees. Since February 2023, Orano has had a dedicated unit to constantly ensure full compliance with the sanctions imposed by national and international authorities against Russia. A specific control process for prior approval of the group’s transactions that remain authorized was immediately activated. 3.3.1.2 Risks related to the energy policies of France, other States and the European Union Description of the risk The development outlook for the group’s activities is sensitive to the French energy policy. In 2024, 48.6% of its revenue was generated in France. The PPE 3 (Multi-Year Energy Program) covering the periods from 2025 to 2035 has been submitted for consultation, and proposes ambitious measures for nuclear energy planning, particularly with regard to fuel cycle activities. PPE 3 thus confirms France’s strategy for the treatment and recovery of spent nuclear fuel, backed up by regulations, and provides for work to continue on renewing the industrial facilities needed to implement this strategy, with a view to taking a decision by the end of 2026, while ensuring that existing infrastructures are adequate to meet needs between now and 2035 and beyond. Any postponement of these decisions beyond 2026 could be detrimental to the sustainability and renewal programs of the facilities. The agreement signed between the French State and EDF in November 2023 to set up the mechanism that will replace the ARENH (Accès Régulé à l’Électricité Nucléaire Historique) as of January 1, 2026 requires a formal adoption in order to implement the new commercial policy for nuclear production and the associated regulatory framework. Nevertheless, the group remains exposed to the risk that the energy policies of certain countries could affect the outlook for the nuclear industry as a whole. In Europe, where the group has achieved 56% of its revenue in 2024, the recognition of the contribution of nuclear energy to the achievement of European climate objectives continues to progress in parallel with the confirmation of new nuclear projects in various EU Member States. However, many debates are still underway (1) The group confirmed the loss of operational control over its subsidiaries in Niger in December 2024. For more information on the situation in Niger, see Section 2.1.2.1.
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