Investment in joint venture

 Morobe Mining Joint Ventures (MMJV) partnership agreement (50%)
 The group has a 50% interest in gold and copper assets located in the Morobe province, PNG. Newcrest owns the remaining 50% interest in these assets. This partnership was formed during the 2009 financial year through a range of transactions, which are discussed below.
 On 22 April 2008, Morobe Consolidated Goldfields Limited and Wafi Mining Limited, subsidiaries of Harmony Australia, entered into a Master Purchase and Farm-in Agreement with Newcrest. This agreement provided for Newcrest to purchase a 30.01% participating interest (stage 1) and a further farm-in of an additional 19.99% participating interest in Harmony's Morobe gold and copper assets, giving them a 50% interest. The total value of the transaction was estimated at US$530 million.
 On 16 July 2008, the conditions to the Master Purchase and Farm-in agreement were finalised, which included regulatory and statutory approvals by the PNG Government. Stage 1 completion took place on 31 July 2008, and a total consideration of R1 792 million (US$229.8 million) was received on 7 August 2008, of which R390 million (US$50.0 million) was placed in a jointly controlled escrow account. This amount was subsequently released to Harmony following confirmation of approval of an exploration license during September 2008 by the PNG mining authorities.
 Harmony recognised a profit of R416 million (US$58 million) on the completion of stage 1, which represented a sale of a 30.01% undivided interest of Harmony's Morobe gold and copper assets and liabilities comprising the joint venture.
 During the farm-in period, Harmony agreed to transfer a further 19.99% interest to Newcrest in consideration for an agreement by Newcrest to meet certain expenditure which would otherwise have to be undertaken by Harmony. The interest to be transferred was conditional on the level of capital expenditures funded by Newcrest at certain milestones, and by the end of February 2009, Newcrest acquired another 10% through the farm-in arrangement. The final 9.99% was acquired by 30 June 2009.
 At the date of completion of each party’s obligations under the farm-in arrangement, Harmony derecognised the proportion of the mining assets and liabilities in the joint venture that it had sold to Newcrest, and recognised its interest in the capital expenditure at fair value. The difference between the net disposal proceeds and the carrying amounts of the asset disposed of during the farm-in arrangement amounted to a gain of R515 million (US$54 million), which has been included in the consolidated income statement for 2009.
 The following are the group's effective share of income, expenses, assets and liabilities, which are included in the 2010 consolidated financial statements:
SA rand  US dollar
20092010Figures in million20102009
50%50%  50%50%
79 Revenue10
(63) Production costs(8)
16 Gross profit2
(108)(302) Other costs(40)(12)
(108)(286) Net loss(38)(12)
1 4272 910 Non-current assets382185
343364 Current assets4844
1 7703 274 Total assets430229
1 241168 Non-current liabilities22161
281148 Current liabilities1936
1 522316 Total liabilities41197