France and Mongolia have signed a 1.6 billion euro ($1.7 billion) deal that paves the way for the mining of uranium in the landlocked country, the chairman of French nuclear energy provider Orano told Nikkei Asia on Thursday.

Under the framework agreement, Orano will operate the Zuuvch-Ovoo mine in southwestern Mongolia, with the aim of laying a foundation stone next year and beginning production around 2028. Both countries will also cooperate in searching for lithium using satellite imagery.

“The strong political support of the French and Mongolian presidents is an asset for us,” Orano Chairman Claude Imauven told Nikkei at the Elysee Palace after a press conference attended by both countries’ presidents. The investment will be made “mostly with French capital, and Mongolian participation,” Imauven said.

In a sign of warming ties between the two governments, Mongolian President Ukhnaagiin Khurelsukh is in Paris for a three-day state visit until Friday. In May, Emmanuel Macron became the first French president to visit Ulaanbaatar.

Mongolia is hoping to expand diplomatic ties beyond its relationships with China and Russia under its “Third Neighbor” policy, while France is keen to diversify its sources for rare earths and materials. The French government believes that the Orano project could account for 4% of global uranium production in the future.

“France is working hard to diversify and secure supplies of raw materials, and Mongolia fits into this,” said Antoine Maire, an associate researcher at Paris-based think tank, the Foundation for Strategic Research.

Orano operates in Mongolia via its local subsidiary Areva Mongol, which controls a joint venture with the Mongolian government called Badrakh Energy. Areva’s exploration in Mongolia over the last two decades has yielded another site at Dulaan Uul as well.

A memorandum of understanding was also signed between France’s Bureau of Geological and Mining Research and Mongolia’s National Geological Service for scientific and technical cooperation, extending a 2018 agreement. This new deal allows French players to position themselves to capitalize on Mongolia’s mining potential, for example in lithium, and to further cooperate in both countries’ transition to renewable energies.

France has been keen to source lithium for its manufacturers of electric vehicles.

Critics have questioned the effectiveness of Mongolia’s “Third Neighbor” policy, saying that it leaves the country open to being exploited, but Maire said that these agreements signed in Paris are mutually beneficial.

“If Mongols are so interested in this partnership with France, it’s because they’re starting to see some very tangible investment in strategic sectors. … They see this partnership with France as a means of resolving structural problems they face, to which their neighbors offer few answers,” he added.

Paris wants to help Mongolia build “strategic autonomy in a very constrained context,” an official from the French presidency told journalists on Monday. The president’s office said earlier in the week that investments in development programs, worth “tens of millions of euros,” will be deployed to Mongolia via the French Development Agency.