Jordan said on Tuesday it had terminated a uranium mining licence for a joint venture between Areva and a local firm, but the French nuclear giant insisted the agreement was only covering exploration.
"The licence for the Jordanian French Uranium Mining Company (JFUMC) to mine for uranium in central Jordan is now void," the Jordan Atomic Energy Commission said in a statement carried by state-run Petra news agency.
"With this decision, the mining agreement has been terminated by mutual consent of all parties to the agreement without any liability on any of the parties involved in the mining agreement."
The commission said JFUMC had "failed to submit its report on time."
The joint venture between Jordan Energy Resources Incorporated (JERI) and Areva said in a June report that the overall uranium potential on the licensed 70 square kilometre (27 square miles) area exceeds 20,000 tonnes.
But an Areva spokesman said it "had never been agreed that (the venture) would lead to production."
"We created a joint-venture with JERI and the JFUMC as part of an agreement on uranium exploration in Jordan, which was due to expire this year (in January)," he told AFP.
"After having extended the convention for a few months, we agreed with our partners to end it... we consider that the job was done."
The spokesman insisted the agreement "was only covering exploration and it had never been agreed that it would lead to production."
The commission said in the statement that a leading Australian company had discovered uranium resources in central Jordan were more than double the amount announced by the JFUMC.
"Since then and under the supervision of a first class specialised international auditor, the parties conducted further field tests and algorithm analysis. As a consequence, the uranium concentration in the top layers should be adjusted with a doubling of the grades as indicated," it said.
"After consultations with other leading companies around the world, the commission will continue exploration in central Jordan, depending on local expertise," it added.
The termination of the licence "does not place any financial or legal liability on any party. The Jordanian French Uranium Mining Company will be responsible for the exploration cost of 20 million dinars ($28 million)," it said.
In 2010, Amman signed an agreement with Areva giving it exclusive uranium mining rights in central Jordan.
Jordan is currently weighing an offer by a consortium formed by Areva and Japan's Mitsubishi as well as a proposal by Russia's Atomstroyexport to build the country's first nuclear plant.
With desert covering 92 percent of its territory, the kingdom is one of the world's 10 driest countries and wants to use atomic energy to fire desalination plants to overcome its crippling water shortage.
Importing 98 percent of its power needs, Jordan also wants to develop nuclear technology to meet its growing energy requirements.