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HARMONY - PRESS RELEASE

Release Date: 08/04/1998 16:03:15      Code(s): HAR HARO
CANADIAN ACQUISITION INTERNATIONALISES HARMONY'S OPERATIONS
JOHANNESBURG, 8 APRIL  -  HARMONY TODAY ANNOUNCED THAT IT WAS IN THE PROCESS OF
ACQUIRING THE BISSETT GOLD MINE IN CANADA IN A MOVE WHICH SIGNIFICANTLY
ADVANCES THE COMPANY TOWARDS ITS GOAL OF BECOMING AN INTERNATIONAL GOLD MINING
COMPANY.
HARMONY WILL PAY R50 MILLION (CAN$14.3 MILLION) FOR THE MINE, WHICH IS EXPECTED
TO PRODUCE 60 000 OZ OF GOLD PER YEAR FROM A MINEABLE RESERVE OF 670 000 OZ AT
A CASH COST OF US$240/OZ.  THE RECOVERED GRADE IS BETWEEN 8G/T AND 9G/T AND THE
CURRENT RESOURCE IS 1.17 MILLION OZ, WITH CONSIDERABLE POTENTIAL FOR EXPANSION.
THE REA GOLD CORPORATION HAD SPENT SOME R300 MILLION (CAN$85 MILLION) ON THE
REDEVELOPMENT OF THE MINE, IN CANADA'S PROVINCE OF MANITOBA, BEFORE FUNDING
CONSTRAINTS FORCED IT INTO RECEIVERSHIP IN DECEMBER LAST YEAR.  THIS CAPITAL
INVESTMENT HAS INCLUDED A COMPLETED SHAFT SYSTEM, HOISTING AND HAULAGE
INFRASTRUCTURE; A COMPLETED SURFACE INFRASTRUCTURE; AND A COMPLETED 1 100 TONS
PER DAY PLANT.  IN ADDITION TO THE MINE, INFRASTRUCTURE AND EQUIPMENT, HARMONY
WILL ACQUIRE A 16-YEAR MINERAL LEASE AND ALL THE NECESSARY ENVIRONMENTAL
PERMITS.
MANAGING DIRECTOR BERNARD SWANEPOEL TODAY DESCRIBED THE ACQUISITION, WHICH IS
SUBJECT TO THE USUAL APPROVALS, AS AN EXTREMELY GOOD DEAL, WHICH WOULD GIVE
HARMONY AN EXCELLENT ASSET AT A BARGAIN PRICE AND PROVIDE IT WITH LOW-RISK
ENTRY INTO THE INTERNATIONAL ARENA.
"OUR GROWTH STRATEGY FIRST TOOK US BEYOND OUR LEASE BOUNDARIES INTO
NEIGHBOURING OPERATIONS AND THEN TO THE EAST RAND.  THE LOGICAL NEXT STEP WAS
TO EXPAND INTERNATIONALLY, AND SINCE OUR ACQUISITION OF THE EXPLORATION COMPANY
LYDEX WE HAVE ACTIVELY EVALUATED OPPORTUNITIES ELSEWHERE IN AFRICA AS WELL AS
IN AUSTRALIA AND CANADA," HE SAID.
SWANEPOEL SAID THE BISSETT MINE HAD BEEN VERY WELL CAPITALISED AND HAD A ROBUST
OREBODY WHICH REQUIRED RELATIVELY SIMPLE MINING METHODS.  IT ALSO HAD A GOOD
MANAGEMENT TEAM AND A HIGHLY SKILLED LOCAL WORKFORCE WHO WERE COMMITTED TO
WORKING WITH HARMONY TO MAKE A SUCCESS OF THE MINE.  THIS STRONG LOCAL TEAM
MEANT THAT THE ACQUISITION WOULD NOT UNDULY EXTEND HARMONY'S OWN MANAGEMENT.
THE PRO-MINING STANCE OF THE PROVINCIAL AND LOCAL GOVERNMENTS WAS A FURTHER
ATTRACTION, AS WERE THE FIRST-WORLD INFRASTRUCTURE AND ENVIRONMENT.
FUNDING ARRANGEMENTS FOR WORKING CAPITAL OF UP TO R40 MILLION WERE ALREADY IN
PLACE AND AN APPROPRIATE HEDGE WOULD HELP TO MINIMISE RISK FURTHER, HE SAID.
"HARMONY'S OVERALL STRATEGY IS TO GROW THE BUSINESS BY LEVERAGING OUR PROVEN
LOW-COST MINING SKILLS TO OTHER OPERATIONS.  IN PRACTICE, THIS MEANS ACQUIRING
BETTER-QUALITY ASSETS AT FAVOURABLE PRICES AND THEN OPTIMISING THEM.  OUR
ACQUISITIONS OVER THE PAST TWO YEARS HAVE DEMONSTRATED THAT HARMONY'S STYLE AND
SKILLS ARE READILY EXPORTABLE, AND THAT THEY CAN BE USED TO TRANSFORM
OPERATIONS WHICH ARE INCREASINGLY DISTANT FROM OUR ORIGINAL BASE.  IN THE
PROCESS, WE HAVE ALSO DEVELOPED STRUCTURES AND SYSTEMS WHICH ARE EASILY
DUPLICATED ELSEWHERE WITHOUT DILUTING THE FOCUS OR FLEXIBILITY NEEDED TO MINE
TOUGH ASSETS," SWANEPOEL SAID.
"HAVING LOOKED CLOSELY AT BISSETT, WE CONCLUDED THAT IT MET ALL OUR CRITERIA,
ESPECIALLY THOSE OF QUALITY AND PRICE.  WE ARE THEREFORE CONFIDENT THAT ITS
ACQUISITION PROVIDES US WITH AN EXCEPTIONAL GROWTH OPPORTUNITY AT A MINIMAL
RISK."
ISSUED BY DU PLESSIS ASSOCIATES ON BEHALF OF HARMONY GOLD MINING COMPANY
LIMITED.
DPA CONTACT KATHY DU PLESSIS ON
TEL:+27(11)728-4701  FAX:+27(11)728-2547
MOBILE:083-266-5847  E-MAIL: GOLD@DPA.CO.ZA



                                        
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