Exploration overview

Total exploration expenditure for the Harmony group of companies was R398 million (US$57 million) (86% PNG and 14% SA) in FY11 and can be broken up into greenfield and brownfield. Harmony’s exploration strategy is to target key prospective geological terranes to create shareholder value through the discovery of large long-life gold orebodies.

Harmony maintains a balanced approach to exploration:

Brownfields exploration work to develop mineral districts, maximise value from established infrastructure, and sustain our operations
Greenfields exploration work to create new opportunities in highly prospective, under-explored mineral provinces and emerging gold districts.

Organic growth and geographical diversification are fundamental to the company’s strategy and this is reflected in the board’s commitment to exploration. Harmony aims to develop a quality pipeline of projects across all stages of the exploration process (ie project generation, advanced projects, resource definition and projects moving into pre-feasibility) to sustain resource growth. Safety, maximising in-ground expenditure, and conviction to drill test high-priority targets are key operational strengths.

Harmony’s approach to accessing quality projects is flexible and can include JV partnerships, acquisition and other arrangements. New growth projects are subject to rigorous application of filter criteria based on project- and country-related risk and ability to meet minimum requirements on potential size, production profile and investment targets.

Outside of South Africa, Harmony has a strong focus on south-east Asia, targeting arc-related epithermal gold and porphyry copper-gold deposits, although sediment-hosted gold deposits are also highly ranked.

More detailed information on exploration and the progress made in FY11 is available in the exploration section of the integrated annual report 2011.

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