Harmony Gold’s billion tons of tailings in the Free State could produce gold at a cost as low as R100 000/kg, Harmony Gold CEO Graham Briggs said on Friday, as the gold price threatened to settle below R200 000/kg, its lowest level since December.

“There’re lots of tailings that ultimately we should bring to account,” Briggs told Mining Weekly Online in an outline of the company’s “sweet spots” that could counteract a declining gold price.

“Ultimately, we should bring to account a billion tons of tailings in the Free State. We can produce gold at R100 000/kg from those operations,” Briggs told Mining Weekly Online.

The possibility of treating 12-million tons of surface tailings a year for 20 years at St Helena was being investigated, he added.

Harmony would also, he said, be remaining steadfastly focused on its long-term growth strategy, which had already seen R4,9-billion being invested to date in five significant growth projects – Phakisa, Doornkop South, Tshepong and Elandsrand in South Africa and Hidden Valley in Papua New Guinea.

Even assuming that Harmony grew only organically in the next five years and not at all by either acquisition or exploration, Briggs pointed out that the company was on track to be producing at a rate of 2,2-million ounces of gold a year by 2012.

“The decision some years ago was to grow organically, and we have continued to do that,” he said, adding that most of the eight-year growth projects were already three-quarters completed.

“We’re within two years, in most of those projects, of actually getting good production, and that’s where our focus remains,” Briggs said, on the anniversary of his taking over the reins of the world’s fifth-biggest gold producer from former CEO Bernard Swanepoel.

He singled out Phakisa as a mine that had a “great orebody”, which would operate at a grade of 7,5 g/t – much above the company norm.

“It’s really going to be a magnificent mine,” he enthused.

“We have been spending money in the right places. Our shafts are seeing more success,” Briggs said, following the company’s net R245-million loss in the 12 months to end June, compared to the R382-million net profit of the previous 12-month period.

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