HARMONY Gold has won an exploration licence in Papua New Guinea’s Southern Highlands which it considers prospective for Ok Tedi-style copper-gold mineralisation. Meanwhile, gold production has dived by almost 40% at its Hidden Valley mine.
The Hamata mill at the Hidden Valley mine in the Morobe province in PNG. Image courtesy of Harmony Gold.
In its March quarterly report, Harmony said six of its tenements were renewed while five new tenement applications in PNG were approved.
The new licence which got the most attention was EL 1786 at Lake Kopiago in the Southern Highlands, where a “major porphyry copper-gold target has been developed”.
Harmony has already set up a camp and community awareness campaign in the tenement and started an airborne magnetic survey.
“The tenement encompasses a bull’s-eye magnetic target with associated gold-copper skarn mineralisation and is considered highly prospective for an Ok Tedi-style copper-gold system,” the South African gold miner said.
At its Mount Hagen project (EL 1611 and EL1596), 2304m of drilling was completed at the Penamb and Bakil prospects, with Harmony eagerly awaiting the assay results.
“Initial gold results from Penamb East are highly encouraging,” Harmony revealed.
At the Hidden Valley mine it equally shares with Newcrest Mining in Morobe province, Harmony’s half-share of production for the March quarter was 409kg of gold – about 15,754 ounces.
The result was nearly 40% lower than the December quarter and was blamed on high rainfall.
In worse news, cash operating costs increased by 59% quarter-on-quarter.
“Increased reliance on low-grade oxide stockpiles during the period resulted in both lower mill throughput and lower recoveries, also contributing to lower overall gold and silver production,” Harmony said.
“Lower gold production was the main contributor to the increase in cash costs per ounce.
“Trucking of ore to the mill continues to supplement the use of the overland conveyor system and adds to the high-cost profile.”
Meanwhile, Newcrest and Harmony’s giant Wafi-Golpu copper-gold project in Morobe province is continuing to advance, with eight rigs drilling targets by the end of March.
The long-awaited prefeasibility study is expected to be completed this quarter but its results are expected to be released in the September quarter and an independent review into it is already underway.
Highlights of drilling during the quarter included a 604m intersection grading 2.01% copper and 1.92 grams per tonne gold from a vast depth of 922m.
The infill resource hole included an intersection of 436m at 2.56% copper and 2.51gpt gold.