JOHANNESBURG (miningweekly.com) – Gold mining company Harmony Gold is in the process of spending R7.7-billion on capital projects.

The biggest of these is the high-grade Zaaiplaats gold project at a capital cost of R4.5-billion. The Moab Khotsong mine will expand through Zaaiplaats.

Another big project at R3.2-billion is the extension of the large Kareerand tailings facility at Mine Waste Solutions, which will extend the life of Mine Waste Solutions by another 16 years, Harmony CEO Peter Steenkamp told Mining Weekly in a Teams interview. (Also watch attached Creamer Media video.)

Additional projects being developed include Target, Tshepong Sub 75, Doornkop Extension, where two more levels are being established to increase the volume of the mine over time, and another 2.5 years is also being added to the life-of-mine of Hidden Valley, in Papua New Guinea.

Regarding the business case presented by going green, Steenkamp said while the first 30 MW of renewable solar power would be through a power purchase agreement, “we’re seeing that in actual fact it’s much more lucrative to do it ourselves, and we do have long-life assets. For instance, Zaaiplaats is a very long-life asset for us, Tshepong is a long-life asset for us, and when we look at Doornkop, it’s going to be a long-life asset. That makes it much more cost-effective over time and the paybacks on those are fairly good, given the current electricity prices”.

Mining Weekly: Also green these days is surface mining because you’re helping the planet to get rid of dumps. Your expansion into surface mining is becoming pervasive. Just outline the future of your surface mining?

Steenkamp: Important is that we have extended the life of Mine Waste Solutions by another 16 years. That is a very, very lucrative business for us. At the moment, our profits out of the business are curtailed by the Franco-Nevada gold streaming contract we still have there, but that will come to an end in three years from now. But our surface sources are big. We have two plants in the Free State that are fully on recyclable retreatment and Kusasalethu could also come into that going forward, provided we find the proper place for the tailings storage facilities for that expansion. Savuka is small but Savuka is also now on tailings retreatment.

When you close mines such as Bambanani, are you going to look after the environment. You are talking about using some of the surface material there but what about the actual closure and making the place look good?

We’re doing a lot of closure and rehabilitation work at the moment, and that is also very much what our long-term plans will be for forestation work that will need to be done and carbon credits. Yes, we are closing down mines. We’ve closed, I think, 48 shafts in the Free State already and we’ve managed to break down the headgear and clean up the areas.

Do you make sure you plant indigenous trees, and don't bring in exotics?

No, we plant indigenous trees.

Some people insist that it has to be endemic. What was growing in the Free State before mining took place, for example, that they want there again - so it might just be grass, or is it always trees that you plant?

No, originally there was a lot of grass in that area, but obviously there will be here and there some types of trees, but in the old Free State areas that still remain, there are grasses.

A lot of people are talking these days about the broad shared value that mines provide through the business of mining. The mines share quite a bit of value calculations are showing. How much did Harmony share in this half-year?

When you think about it, Harmony in the full year shared R31-billion worth of money that we’ve spent on things including salaries, electricity, consumables, communities, and the like, and most of that is spent in South Africa, because we don’t use a lot of suppliers outside of South Africa. That’s a massive amount of money that is spent. If you think about what is spent in, for instance, just the Welkom area, people are using their salaries to buy in shops. Bambanani is a very good example. As I said in my presentation, we expanded the life-of-mine by mining the shaft pillar, which probably not many companies would do. We’ve done it and we’ve done it safely. We created R4-billion in profit for Harmony over the time, but we also paid salaries to the 1 500 that worked there who brought that pay back into the community in terms of the gross domestic product contribution that was just created by that activity. Last year we spent R31-billion and it’s definitely going to be more this year because of the Mponeng mine and Mine Waste Solutions that we have as part of our portfolio.