JOHANNESBURG – Harmony Gold Mining’s long-running talks to buy AngloGold Ashanti’s South African assets have stalled because of uncertainty over the country’s new mining regulations, according to people familiar with the matter.

The discussions, which started two years ago, recently hit a snag as South Africa’s government and the mining industry wage a court fight over the Mining Charter, according to two people, who asked not to be identified because the proposed deal isn’t public. The charter calls for increased black ownership of assets and imposes extra costs on mining companies.

The assets could potentially be valued around $500-million to $650-million, said another person. An alternative option being considered is a partial sale, with Harmony buying AngloGold’s Vaal River operations for about $150-million, the person said.

When asked about the deal, a spokeswoman from Harmony called it "pure speculation" and declined to comment further. An AngloGold spokesman also declined to comment.

AngloGold, the world’s third-largest gold miner, has been held back by its South African assets for the last three years as their high costs eroded the group’s earnings. Chief Executive Officer Srinivasan Venkatakrishnan attempted to spin them off in 2014 but the plan was scuppered after investors balked at an accompanying rights issue.

AngloGold pared losses, trading 3.7% lower at 128.20 rand a share at 3:43 p.m. in Johannesburg after earlier falling as much as 6.1%. Harmony fell 2.4%.

Harmony, which has a market value of $760-million, mainly operates end-of-life mines in South Africa and has spoken often about needing acquisitions to boost declining reserves. Some of its existing mines were previously owned by AngloGold.

“We have to look for something fairly big,” Chief Executive Officer Peter Steenkamp said last August.

With the Harmony deal uncertain, AngloGold has started restructuring the mines to stem cash losses. In June, the company said 8 500 jobs, about a third of the total, were at risk.