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Areva, France’s state-owned nuclear champion, will report an operating loss of up to €1.6bn this year largely as a result of a ruinous bet made on uranium prices through the 2007 acquisition of a small-cap mining stock.

The company paid €1.8bn for UraMin, a Canadian-headquartered company with assets in Namibia, the Central African Republic and South Africa, at a time when uranium was priced at about $138 per pound. Today the commodity used to power atomic reactors is trading at about $50 per pound as anticipated demand has slumped because of this year’s Fukushima nuclear disaster in Japan.

Areva also said yesterday that uranium deposits at UraMin’s mines were far smaller than expected.

As a result of these various factors, the company is taking a €1.46bn writedown on UraMin, on top of a €426m provision last year. The size of the charge is embarrassing for the French government, which sanctioned the original purchase, and Anne Lauvergeon, Areva’s former chief executive.

Before the purchase, UraMin had been listed on Aim, London’s junior exchange, for just two years after floating with a value of £120m.

The deal was part of an ambitious attempt to turn Areva into a nuclear industry all-rounder, whose interests ranged from its core reactor-building business to the treatment of nuclear waste and substantial mining assets.

Areva said it would also take another €900m in charges related to its broader nuclear activities around the world, including the impact of cost overruns on its delayed flagship project to build a so-called third-generation atomic plant in Finland.

The company has had a difficult year as the Fukushima disaster led to several countries such as Germany deciding to scrap atomic power, while Ms Lauvergeon, the long-serving chief executive known as “atomic Anne” because of her powerful position in the industry, was ousted in June by Nicolas Sarkozy, the French president.

The write-downs are part of an attempt by Luc Oursel, Ms Lauvergeon’s replacement and former chief operating officer, to start with a clean slate as he cuts the company’s international workforce and its planned capital spending because of the impact from Fukushima.

Areva said the write-downs meant operating losses this year should be between €1.4bn and €1.6bn, the first loss for the 10-year-old group.

Mr Oursel said he would cut yearly costs by at least €1bn by 2015 and sell at least €1.2bn of unidentified assets by 2016 to restore profits and reduce debt. A director at France’s sovereign wealth fund told Reuters on Monday that it wanted to buy Areva’s 26 per cent stake in Eramet, a nickle miner.

The new chief executive is due to announce a five-year plan on Tuesday to restructure the group’s international operations, which is likely to involve job losses in Germany and a recruitment freeze in France. The French government has told Mr Oursel that he will not be able to cut French jobs.

Mr Oursel said last night that he was confident about the nuclear industry’s future because of the need to cut reliance on non-carbon producing energy sources. “Considering the expected growth in electric consumption, we are convinced that the outlook for nuclear and renewable energy development remains strong in the coming years, even if expansion of the global installed base of nuclear reactors is postponed,” he said.

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