Underground at
Elandsrand, one of
Harmony’s four gold
projects reaching
full production
by 2010
Cape Town, South Africa — MININGREVIEW.COM — 6 February, 2008 – Harmony Gold – the world’s fifth largest gold producer – intends producing 2.5 million ounces of gold by 2010/11, an increase of 25% on current production levels.

Confirming this in an address to the Mining Indaba here, Harmony CEO Graham Briggs confirmed that four of the company’s five current projects are in South Africa, and are scheduled to reach a combined full production total of almost 1.2 million oz pa by the middle of 2010. Combined capital expenditure on the four mines will be R4.5 billion.

First on line, he said, would be the Tshepong project, which was expected to be at full production of 135 000 oz pa in May this year.

The other three were due to attain full production during the course of 2010, Briggs added. Doornkop mine was scheduled to reach 340 000 oz pa in March of that year, Phakisa was set for 280 000 oz pa in May, and Elandsrand mine was aiming at 444 000 oz pa by June.

He pointed out that Harmony was currently producing 2 million ounces of gold at a cost of R133 000/kg (or US$550/oz), but emphasised that increased spending on improving quality was intended to reduce this to R120 000/kg (or US$480/oz).

Briggs went on to say that the prospect of a protracted power shortage – with five days’ production lost last month and mines now having to operate at 90% of normal electricity consumption – presented a challenge to the mining industry.

Looking on the bright side, however, he was optimistic, predicting that the gold price would rise to R233 000/kg over the next six months, compared to R163 000/kg over the past six months. This would mean a margin of R90 000/kg, as opposed to the previous R30 000/kg.

Changing the subject, Briggs confirmed that Harmony’s Cooke uranium dumps remained an exciting project. The proposed uranium plant would cost R2.5 billion, he revealed. It would have a capacity of 2m lbs pa, and would be expected to reach full production in April 2011.