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HARMONY GOLD MINING COMPANY LIMITED - Harmony acquires full ownership of the Hidden Valley mine in Papua New Guinea

Release Date: 19/09/2016 07:05:00      Code(s): HAR       PDF(s):  
Harmony acquires full ownership of the Hidden Valley mine in Papua New Guinea

Harmony Gold Mining Company Ltd
Registration number: 1950/038232/06
Incorporated in the Republic of South Africa
ISIN: ZAE000015228
JSE share code: HAR
(“Harmony” or “the company”)



Harmony acquires full ownership of the Hidden Valley mine
in Papua New Guinea

Johannesburg, Monday, 19 September 2016: Harmony Gold Mining
Company Limited (Harmony) today announced that it has signed
an agreement to purchase Newcrest PNG 1 Ltd, the wholly-owned
subsidiary of Newcrest Mining Limited (Newcrest) which holds
Newcrest’s 50% interest in the Hidden Valley joint venture,
for a cash consideration of US$1. Finalisation of this
transaction, which will give Harmony 100% ownership of the
Hidden Valley mine, is conditional upon regulatory approval in
South Africa.

“Our acquisition of the Hidden Valley mine is aligned with our
overall aspiration to increase our annual production profile
to 1.5Moz within three years. We believe that Hidden Valley
has the potential to contribute approximately 180 000oz gold
per annum to Harmony’s production profile at an all-in
sustaining cost of less than US$ 950/oz within the next three
years,” Peter Steenkamp, chief executive officer of Harmony
said.

As at 30 June 2016, the Hidden Valley mine had an estimated
mineral reserve of 1.4Moz of gold at 1.6g/t and 27Moz of
silver at 31g/t, resulting in total gold equivalent ounces of
1.8Moz at 2 g/t. The estimated mineral resource includes 4Moz
of gold at 1.6g/t and 73Moz of silver at 29g/t. Mining the
stage 5 and 6 cutback will extend the current mine life by 7
years and require an initial capital investment of
approximately US$180 million.

Harmony will also acquire Newcrest’s 50% interest in the
exploration tenements adjacent to the Hidden Valley mine.

On completion of the transaction, Harmony will assume all
liabilities and expenses related to the Hidden Valley joint
venture and mine, including all closure, rehabilitation and
remediation obligations, with effect from 31 August 2016.
Newcrest has funded Newcrest PNG 1 Ltd to an amount of
US$22.5m, as its once-off contribution towards Hidden Valley’s
future closure liability.
Harmony and Newcrest will remain joint venture partners in the
Wafi-Golpu project.

“Acquiring 100% of the Hidden Valley mine and its surrounding
exploration tenements meet our acquisition criteria. After
the initial investment phase Hidden Valley will generate
strong free cash flows, which could be applied to the
development of the Wafi-Golpu project and our exciting
exploration portfolio in Papua New Guinea,” Peter Steenkamp
added.


For more details contact:

Frank Abbott

Financial Director

+27 (0) 82 800 4290




Marian van der Walt
Executive: Corporate and Investor Relations
Tel: +27(0) 82 888 1242


Johannesburg, South Africa

19 September 2016

Sponsor:

J.P. Morgan Equities South Africa Proprietary Limited

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