Business Day Live |17.02.2016
HARMONY Gold and its partner, Australia’s Newcrest Mining, plan to build a pipeline traversing about 65km of Papua New Guinea to pump a copper and gold concentrate from their Wafi mine to the port of Lae.
The Wafi pipeline will be far shorter than the 529km pipeline Anglo American built to pump iron-ore slurry to the coast. Another critical difference is that Harmony does not foresee that permit challenges will stall its project — something that gave Anglo executives sleepless nights and led to project cost and time overruns.
Johannes van Heerden, the CEO of Harmony’s East Asia unit, said the pipeline would be installed along areas that already had infrastructure in the form of power lines or a highway.
While he was sanguine on the pipeline, experience of operating in Papua New Guinea, where Harmony and Newcrest built and operate the loss-making Hidden Valley gold and silver mine, has meant the partners have given themselves a two-year window to secure approvals from a broad range of stakeholders for the Wafi mine.
The mistakes the partners made at Hidden Valley, which is under consideration for sale, closure or reinvestment, have proved an expensive but valuable lesson in building and operating a big mine in Papua New Guinea.