Name of the Project
Wafi-Golpu gold project.

Location
The project is located 65 km south-west of Lae, in the Morobe province of Papua New Guinea (PNG).

Project Owner/s
Wafi-Golpu Joint Venture (WGJV), comprising Harmony Gold and Newcrest Mining. The PNG government holds an option to buy 30% of the project.

Project Description
The project has an updated ore reserve estimated at 200-million tonnes grading 0.86 g/t gold and 1.2% copper.

Ore extracted will be undertaken through three block caves producing ore at a 17-million-tonne-a-year design capacity, producing 161 000 t/y of copper and 266 000 oz/y of gold at steady state.

The updated feasibility study, released in March, proposes initial underground access through the Nambonga decline, offering:
 

• earlier and quicker access to underground drill platforms in support of an extensive underground drilling programme;
• access to an underground work front in support of developing the twin Watut declines from the surface and underground;
• the derisking of project execution and the critical path to achieving first production; and
• a second means of egress in the future, replacing a blind-sunk intake ventilation shaft.

Primary underground access is proposed through the Watut portal and the twin Watut declines to the underground block cave mine. 

The Watut declines also form part of the primary ventilation circuit and materials handling system conveying ore to the Watut process plant.

A ‘cave engineering level’ will be established above the Reid fault at 4 870 m reduced level, or mRL 12, for data gathering, further refinement of the rock mass, monitoring of the cave and, potentially, dewatering.

It is planned that during caving operations, ore from the block cave drawpoints will be delivered by autonomous load-haul-dump vehicles to the underground crushers. 

The proposed materials handling system will include two crushers on each level, from which the crushed ore will be conveyed to the surface using dedicated transfer conveyors. 

The ore conveyor emerging at the portal terrace on the surface will continue overland to deliver crushed ore to a coarse-ore stockpile adjacent to the Watut process plant.

The proposed Watut process plant will be a compact copper concentrator that will be progressively built in line with the profile of the mine ramp-up to safely and efficiently process 17-million tonnes a year of crushed ore to produce a high-grade copper concentrate.

The facility comprises a semiautogenous grinding mill, two ball mills and a recycle crushing configuration, as well as flotation, thickening, concentrate and tailings pumping systems. 

It is designed to recover copper and gold over the life-of-mine (LoM) at an average of 94% and 68% respectively. 

Concentrate grade-average over the LoM is assessed to be 29% copper and 15 g/t gold.

The Watut process plant is designed to treat about 8.4-million tonnes a year of ore for the first three years of operation. 

The slow mine-production ramp-up will necessitate intermittent operation, particularly during the first two years of mine life. 

The inclusion of an additional ball mill and additional flotation cells in the fourth year is designed to enable the process plant to ramp up to about 17-million tonnes a year. The proposed installation of the Golpu pyrite flotation and regrind circuit the following year will facilitate the processing of ore containing a higher metasediment content from Year 5 onwards.

Various terrestrial tailings storage, dry-stacking and deep-sea tailings placement (DSTP) facilities have been considered during the various studies undertaken on the project since 2012.

The updated feasibility study has identified the use of DSTP as the preferred tailings management solution.

The project has a mine life of 28 years.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has a net present value, at an 8.2% discount rate, of about $2.6-billion and an internal rate of return in real terms of about 18.2%, with a payback of 9.5 years.

Capital Expenditure
Initial capital expenditure to commercial production is estimated at $2.83-billion.

Planned Start/End Date
Not stated.

Latest Developments
A memorandum of understanding (MoU) with the PNG government has advanced Harmony Gold to what is described as a significant step closer to securing the special mining lease for the Wafi-Golpu project.

The MoU is described as an affirmation of the parties’ intent to proceed with the long-awaited Wafi-Golpu project, subject to the finalisation of the permitting process and approvals by the Harmony and Newcrest boards.

It sets out terms to be included in the mining development contract, which is a prerequisite for the grant of a special mining lease, which includes equity participation by the State and its nominees, landowners and the Morobe provincial government.

Other terms embrace royalty rate and taxation, provision for fiscal and regulatory stability to underpin the long-term investment required to develop and operate the project, and social contributions to be made by the project towards business development, infrastructure development and other social development projects that will deliver long-term benefits to local communities.

The framework for the parties to progress the permitting of the project as quickly as practicable is also outlined in the MoU, which recognises that the development of the project will be of major economic significance to the people of PNG.

It encourages development in a way that contributes to the advancement of social and economic welfare while providing a foundation for long-term mining development. 

Once the special mining lease is granted, the 2018 feasibility study update will be completed and board approval sought for the requisite financial investment decision to develop the project.

Key Contracts, Suppliers and Consultants
None stated.

Contact Details for Project Information
Harmony Gold corporate affairs team executive manager, Mashego Mashego, tel +27 11 411 2020 or email Mashego.mashego@harmony.co.za.