HARMONY Gold mining company, Africa’s third largest producer of the precious metal, has revealed that the company’s Wafi-Golpu joint venture with Newcrest Mining Ltd in Papua New Guinea may be three times the size of its next biggest mine, The National reports.
According to a presentation posted on the Harmony website, Wafi may yield as much as an annual 700,000 ounces of gold and 320,000 tonnes of copper.
The company was still working on sizing up the resource.
Harmony, which produced 1.43 million ounces of gold last fiscal year, was digging mines abroad as depleted South African reserves became more difficult and dangerous to excavate, coupled with rising cost of labour and electricity.
In the financial year ended June 30 last year, Harmony’s Tshepong mine yielded about 217,000oz of gold.
The company climbed 3.66 rand, or 2.7% to 99.61 rand - the highest level since April 2009 close of the Johannesburg trading, giving Harmony a market value of US$6 billion.
Wafi may add US$1.5 billion to US$2 billion, or about 40%, to the value and make the company a takeover target, RBC Capital Markets said last week.
Wafi’s content was estimated at 16moz of gold, 4.85mt of copper and 55,000t of molybdenum, or a total gold equivalent of 38.5moz, according to the presentation.
It added that only Freeport-McMoran Copper & Gold Incorporated’s Grasberg mine in Indonesia and Ivanhoe Mines Ltd’s Oyu Tolgoi deposit in Mongolia have higher gold equivalent grades.
Harmony’s management last year estimated the cost of building a mine at Wafi at US$2.5 billion to US$3 billion.