Name of the Project
Wafi-Golpu gold project.

Location
The project is located 65 km south-west of Lae, in the Morobe province of Papua New Guinea (PNG).

Client
Wafi-Golpu Joint Venture (WGJV), comprising Harmony Gold and Newcrest Mining. The PNG government holds an option to buy 30% of the project.

Project Description
The updated ore reserve at the project is estimated at 200-million tonnes grading 0.86 g/t gold and 1.2% copper.

Ore extracted will be undertaken through three block caves producing ore at a 17-million-tonne-a-year design capacity, producing 161 000 t/y of copper and 266 000 oz/y of gold at steady state.

The updated feasibility study, released in March, proposes initial underground access through the Nambonga decline, offering:
∞ earlier and quicker access to underground drill platforms in support of an extensive underground drilling programme,
∞ access to an underground work front in support of developing the twin Watut declines from the surface and underground,
∞ the derisking of project execution and the critical path to achieving first production, and
∞ a second means of egress in the future, replacing a blind-sunk intake ventilation shaft.

Primary underground access is proposed through the Watut portal and the twin Watut declines to the underground block cave mine. 

The Watut declines also form part of the primary ventilation circuit and materials handling system conveying ore to the Watut process plant.

A ‘cave engineering level’ will be established above the Reid fault at 4 870 m reduced level, or mRL 12, for data gathering, further refinement of the rock mass, monitoring of the cave and, potentially, dewatering.

During caving operations, ore from the block cave drawpoints is planned to be delivered by autonomous load-haul-dump vehicles to underground crushers. 

The proposed materials handling system will include two crushers on each level from which the crushed ore will be conveyed to the surface using dedicated transfer conveyors. 

The ore conveyor emerging at the portal terrace on the surface will continue overland to deliver crushed ore to a coarse ore stockpile adjacent to the Watut process plant.

The proposed Watut process plant will be a compact copper concentrator that will be progressively built (in line with the profile of the mine ramp-up) to safely and efficiently process 17-million tonnes a year of crushed ore to produce a high-grade copper concentrate.

The facility comprises a semiautogenous grinding mill, two ball mills and a recycle crushing configuration, as well as a flotation, thickening, concentrate and tailings pumping systems. 

The facility is designed to recover copper and gold over the life-of-mine (LoM) at an average of 94% and 68% respectively. 

Concentrate grade average over the LoM is assessed to be 29% copper and 15 g/t gold.

The Watut process plant is designed to treat about 8.4-million tonnes a year of ore for the first three years of operation. 

The slow mine-production ramp-up will necessitate intermittent operation, particularly during the first two years of mine life. 

The inclusion of an additional ball mill and additional flotation cells in the fourth year is designed to enable the process plant to ramp up to about 17-million tonnes a year. The proposed installation of the Golpu pyrite flotation and regrind circuit the following year will facilitate the processing of ore containing a higher metasediment content from year five onwards.

Various terrestrial tailings storage, dry-stacking and deep-sea tailings placement (DSTP) facilities have been considered during the various studies undertaken on the project since 2012.

The updated feasibility study has identified the use of DSTP as the preferred tailings management solution.

The project has a mine life of 28 years.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has a net present value, at an 8.2% discount rate, of about $2.6-billion and an internal rate of return in real terms of about 18.2%, with a payback of 9.5 years.

Value
Initial capital expenditure to commercial production is estimated at $2.83-billion.

Duration
Not stated.

Latest Developments
The WGJV has  signed a memorandum of understanding (MoU) with the PNG government as an affirmation of the parties’ intent to proceed with the Wafi-Golpu gold project.

This is subject to finalisation of the permitting process and Harmony and Newcrest board approvals.

The MoU establishes the framework for the parties to progress the permitting of the project as quickly as possible in accordance with applicable regulatory processes.

It provides a framework of key terms to be included in the Mining Development Contract and other related agreements with the State, including provision for stability to underpin the significant long-term investment required to develop and operate the project.

The MoU also reaffirms the intention of the parties to complete the permitting process and secure a special mining lease by June 30, 2019. 

As a result of entering into the MoU, the WGJV is completing approval processes to begin a substantial work programme, including the establishment of underground access for further drilling of the Golpu deposit and the construction of a bridge over the Markham river, an integral feature of the proposed new Northern Access road from the Highlands Highway to the mine site.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
Harmony Gold group communications manager Sihle Maake, tel +27 11 411 2312 or email sihle.maake@harmony.co.za.
Newcrest Mining investor enquiries Chris Maitland, tel +61 3 9522 5717 or email Chris.Maitland@newcrest.com.au.