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Harmony Gold board approves R7.9bn project on back of superb half-year results


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Harmony Gold board approves R7.9bn project on back of superb half-year results

Harmony Gold presentation covered by Mining Weekly’s Martin Creamer. Video: Darlene Creamer.

28th February 2024

By: Martin Creamer
Creamer Media Editor


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JOHANNESBURG ( – The board of mining company Harmony Gold has approved the commencement of a R7.9-billion life-of-mine (LoM) extension project at the rich Mponeng gold mine in the West Wits region of South Africa's Gauteng province.

Mine life will be extended from seven years to 20 years, ensuring that Mponeng remains a top-performing asset until at least 2044.


“Mponeng is an incredible mine with an existing world-class infrastructure,” Harmony CEO Peter Steenkamp enthused during Wednesday’s presentation of superb half-year financial results accompanied by the declaration of a record interim dividend underpinned by 226% higher headline earnings. (Also watch attached Creamer Media video.)

After Mponeng was acquired from AngloGold Ashanti in 2020, Harmony began a comprehensive update of the feasibility study to determine if it could extend Mponeng’s LoM.


Following two years of work, Harmony now has an optimised mine design, which ensures that it can extend the LoM safely and profitably.

The Mponeng project will be self-funded through internal cash flows.

How this will be done was outlined to Mining Weekly by Harmony FD Boipelo Lekubo: “We estimate that around R7.9-billion in project capital will be required over the life of the project. In this half-year reporting period alone, Mponeng generated R1.9-billion rand in operating free cash flow and we estimate that Mponeng will be able to fund the extension out of operating cash flow.

“That will be done at an estimated rate of R1-billion worth of capital, or call it $50-million, a year, which makes this project affordable,” Lekubo added.

The Mponeng project meets all investment criteria of the Johannesburg- and New York-listed company, which is also making progress with the execution of the Moab Khotsong gold mine extension, the Mine Waste Solutions tailings extension, and the Hidden Valley extension in Papua New Guinea.

Mponeng accesses two excellent orebodies, namely the Carbon Leader and the Ventersdorp Contact reefs, which both have exceptional grades of more than 9 g/t.

The project will convert more than three-million ounces of gold onto mineral reserves, delivering at an average steady-state production of 260 000 oz, or 8 t, of gold a year.  

Once the project is complete, Harmony is forecasting a cash contribution of about R2.5-billion a year at a real gold price of R1.1-million per kilogram.

Because of the high grade, the project will have an attractive real all-in sustaining cost of R768 000/kg, or $1 290/oz, based on current assumptions and estimations.

With a substantial mineral resource of 24-million ounces, this is another example of how Harmony continues to extend its production profile by converting mineral resources to mineral reserves.

“We’re proud that, in our hands, Mponeng will reach its true potential and deliver a significant positive social impact. This embodies how Harmony creates long-term value for its shareholders and stakeholders,” added Steenkamp.

Harmony, which now has a copper footprint and uranium and silver by-products, has built a foundation that will facilitate an ongoing upward trajectory.

While strong commodity prices have provided Harmony with good tailwinds, improved safety, good mining discipline and operational flexibility with a stable and predictable cost structure, remain fundamental to creating the long-term value expected by its stakeholders.

The company is intent on continuing to use its skills and strong orebody understanding to extract further value.

In the six months to December 31, record operating free cash flow rose 265% to R7 112-million driven by operational prowess and 11% higher underground recovered grades to 6.29 g/t from 5.68 g/t.

Full-year production guidance for the group remains unchanged at between 1 380 000 oz to 1 480 000 oz of gold. Full-year cost guidance also remains unchanged at less than R975 000/kg. Underground grade guidance remains unchanged at 5.60 g/t to 5.75 g/t.

Yearly production and grade are expected to be at the upper end of guidance, while costs are expected to remain well below the guided level, it was announced at the half-year results presentation covered by Mining Weekly.


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