South Africa’s Harmony Gold expects a prefeasibility study on the large Wafi-Golpu gold/copper prospects, in Papua New Guinea (PNG), to be completed in 2011, possibly followed by a definitive feasibility study in 2013, CEO Graham Briggs said in a presentation last week.

Harmony owns the assets in a 50:50 joint venture with Australia’s Newcrest Mining, and the partners are currently commissioning their first mine in PNG – Hidden Valley – which poured its first gold in June.

The Wafi project would likely be developed as an openpit gold mine, with the potential for grades of 1,5 g/t to 2 g/t, while the Golpu copper/gold porphyry project would probably be an underground block-cave operation.

Golpu currently has a mineral resource estimate of 6,31-million ounces of gold equivalent, and 0,7-million ounces of reserves. Wafi’s gold resources are estimated at 3,12-million ounces.

Harmony would like to see studies on the projects getting under way in the next 12 months.

“With Hidden Valley, Wafi-Golpu and the exploration prospects, there are all the signs of a great mining province. And, certainly, it’s our intention to get these mines to deliver in the future,” Briggs told delegates at the Denver Gold Forum, in a presentation broadcast over the Internet.

“There is huge potential in PNG to develop future projects.”

The Hidden Valley mine is expected to reach commercial production next quarter, and Harmony has estimated its attributable production from the mine at between 105 000 oz and 120 000 oz in the company’s 2010 financial year, which ends on June 30.

“We’ve been going through all the teething problems of commissioning, so we’re not going to get a full year of production and there’s still a bit of a question mark on the estimate of production for this year,” Briggs said.

The Hidden Valley operation will produce more than 250 000 oz of gold and four-million ounces of silver a year over a projected 14-year life-of-mine.

Design throughput is currently 4,3-million tons a year, but Briggs said this could be increased to 4,7-million tons a year through debottlenecking measures.

“And that should be obtained quite easily.”

Briggs also sees a lot of potential to expand in the area, although that will require the conversion of significant resources into reserves, as well as additional tailings capacity from the current 42-million tons.

“Certainly, our partners and ourselves are very optimistic,” Briggs commented.

“This is an incredibly prospective area. We not only have further ounces within the pits which aren’t declared as reserves, but we’ve got depth extensions.”

Harmony, which also produces gold from underground, openpit and tailings-recovery operations in South Africa, produced 1,55-million ounces in the year ended June 30, 2009, but expects output to increase to 2,2-million ounces in 2012.

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