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Harmony eyes several more PNG prospects as it builds $250m mine

Publication: Mining Weekly
Source: Mining Weekly
Journalist: Matthew Hill

The world’s fifth-biggest gold-miner, Harmony Gold, said on Thursday that it was “very keen” on opening several mines in Papua New Guinea (PNG), and that the challenges that it had met through mining in South Africa would put the firm in good stead to mine in the Australasian country.

“The region is extremely prospective with a very good chance of finding some great deposits,” South East Asia MD Graham Briggs stated, in answer to questions emailed by Mining Weekly Online.

He added that Harmony would hope not to operate a single mine in PNG but have several mines, thus reaping the benefits of mining on a regional basis.

The South Africa-based miner was already building a mine at its Hidden Valley prospect, on which it expected to spend some $250-million, or R1,8-billion, and bring into production by November 2008.

It was also conducting a prefeasibility study at its Golpu prospect, which would yield significant levels of copper as a by-product, and expected to complete the probe during July.

Its study into nearby Wafi, meanwhile, was due for completion in October. Initial exploration had shown that this orebody also contained more copper than gold.

Harmony had previously indicated that it would probably only mine the gold at these projects, and bring in a partner to exploit the copper reserves.

Briggs said that Harmony was now talking to “various people that were interested in the copper”, which included large Japanese and Korean smelting companies.

He had previously indicated that Harmony could spend as much as $1-billion to exploit the Wafi/Golpu orebodies.

New Biamena find could offer ‘huge’ synergy opportunities

Briggs said that Harmony’s new find, Biamena, could also offer material synergies for potential mining in the region.

On May 8, Harmony announced that it might have found another gold/copper deposit at nearby Wafi.

In a presentation posted on the firm’s website, CEO Bernard Swanepoel said that initial mapping and trenching exploration had uncovered a 15-m strike containing 24 g/t of the yellow metal, and 1,5% of copper.

“Geology suggests porphyry-related mineralisation,” he said.

“Biamena is still very much in the exploration stage, we should be drilling in a month or two,” Briggs said.

He noted that a prefeasibility study was still “a long way off”.

However, Briggs was upbeat on the prospects of Harmony developing a new mine in the area.

“Harmony is exploring in a very exciting geological area, we know we have one major copper porphyry deposit (Golpu) and these deposits very rarely are found as singular deposits,” he said. “We are sure there are more, however, they are often “blind”, or do not crop out at surface, and, therefore, can be difficult to find.”

And, should a new mine prove viable, it would add a lot of value for Harmony in PNG.

“Any new discovery would mean huge synergies for potential mining in this region,” Briggs said.

“Golpu would potentially be a block-cave mine, and our studies show that it is very amenable to caving and would cave at about nine-million tons a year.

He said that the cost of infrastructure for such a mine would be relatively high, and a second deposit would imply that the capital would be spread over two mines.

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