Ulan Bator AFP-JIJI

French nuclear energy giant Areva signed a deal with Mongolia's state-owned Mon-Atom on Saturday to develop two uranium mines in the Gobi Desert, officials said.

Areva said the agreement will create a company that will be 66 percent owned by Areva and 34 percent owned by Mon-Atom, and Mitsubishi Corp. will take an equity interest.

The deal was signed during a visit by French Foreign Minister Laurent Fabius. His Mongolian counterpart, Luvsanvandan Bold, said the deal represents an important step for the resource-rich but still impoverished nation. Other deals signed Saturday included cooperation on farming, culture, sports and tourism.

Areva, which has had a presence in Mongolia for more than 15 years, said that exploration work had discovered two uranium deposits with estimated reserves of 60,000 tons.

Mongolian protesters had warned before the signing that a deal could lead to the contamination of water resources in the area.

"We are not against cooperation with France. . . . But we just say 'No uranium exploration in Mongolia,' as not having it is the best way to prevent radioactive pollution," said Selenge Lkhagvajav, one of the protest leaders.

Wedged between Russia and China, Mongolia has been seeking to broaden the base of its allies, notably exploring relationships with France, Japan and Germany.