Allan Seccombe | Business Day Live | 25 August 2016
HARMONY Gold and its Australian partner Newcrest Mining have submitted an application for a special mining lease for its copper and gold Wafi-Golpu project in Papua New Guinea.
Harmony and Newcrest are equal partners in the Golpu deposit, which has a resource of 824-million tonnes containing 1.05% copper, 0.7 grams per tonne of gold and 1.25 grams a tonne of silver. It also contains 90 parts per million of molybdenum, which is used in various steel applications and as an alloy.
Harmony CEO Peter Steenkamp said recently the partners had pencilled in a two-year wait to secure the lease.
The partners are conducting further work to optimise the costs of bringing Golpu into production, giving Papua New Guinea its largest underground mine, Harmony said on Thursday.
“Further project development will be subject to the granting of the special mining lease, the obtaining of all necessary permits, approvals and agreements, and, ultimately, approval by the boards of both Harmony and Newcrest,” it said.
The Papua New Guinea government has the right to buy a 30% stake in the Golpu project at any time up to the start of mining, which would reduce the partners’ stakes to 35% each, Newcrest said on Thursday.
Harmony wants to grow its gold production to 1.5-million ounces in the next three years, from 1-million ounces this year, to give it the mass to take on the funding of the Golpu project, Steenkamp said.
Harmony has put three South African mines into harvest mode, stopping mining at the operations over the next three to five years and taking more than 200,000oz out of its production profile, leaving it too small to tackle the project, he said.