A leading gold producer in South Africa has just significantly boosted its expanding SA portfolio with the acquisition of two major gold mine assets.
Harmony Gold Mining Company has announced that it has entered into an agreement with AngloGold Ashanti to acquire its Moab Khotsong and Great Noligwa mines, together with certain long-life projects and tailings dams, for a consideration of US$300 million in cash.
Harmony believes the acquisition will enhance its position as a “robust cash-generative” gold mining company, increasing grades, driving down all-in sustaining costs and growing its South African gold portfolio.
The acquisition falls within a larger strategy to grow, produce safe profitable ounces.
Harmony’s portfolio will see a boostof 250 000 ounces of gold at an all-in sustaining cost below Harmony's target of US$950/oz, increasing Harmony’s average recovered grade to 5.7g/t. Synergies with Harmony’s current asset portfolio is expected to realise further upside, progressing pillar extraction at Great Noligwa and reclamation at Mispah tailings.
"Buying Moab Khotsong means we boost our cash flows by more than 60%, increase our average overall underground recovered grade by 12% and grow our South African underground resource base by 38%. The Acquisition benefits all our stakeholders. It creates value for our shareholders, preserves jobs and sustains the surrounding mining communities with the potential to significantly extend the life of mine of the Moab Khotsong operations. We believe the South African gold mining environment creates opportunities which Harmony has chosen to capitalise on,” Peter Steenkamp, chief executive officer of Harmony said.
Kopanang, which is bound to the south by the Jersey Fault, has a single shaft system to a depth of 2,334m. It exploits the Vaal Reef almost exclusively, producing gold as its primary output and uranium oxide as a by-product.
Moab Khotsong, AngloGold Ashanti’s newest South African mine, is located in the Free State and has a single shaft system mining to a depth of 3,100m. Given the geological complexity of the Vaal Reef, the mine’s principal reef, scattered mining is employed. Great Noligwa’s operating infrastructure and employees have been incorporated into Moab Khotsong since 2015