HARMONY Gold will complete studies into a tailings project in South Africa’s Free State province this year that could ensure gold production from the region for a century.
Peter Steenkamp, CEO of Harmony Gold said in an interview on Thursday his firm hoped to make an investment decision on the project during the firm’s 2026 financial year.
Harmony Gold is known for its deep, underground mining but it also mines surface ore which it bolstered with the acquisition of Mine Waste Solutions (MWS) from AngloGold Ashanti in 2020 as part of its acquisition of Mponeng.
MWS produced 121,207 ounces of gold in Harmony’s 2024 financial year ended June at an all-in sustaining cost (AISC) of $1,008/oz. This compares to the group’s average ASIC for the period of $1,500/oz.
“Tailings retreatment presents a fantastic opportunity for Harmony due to the lower risk, high margins and positive ESG story associated with these operations,” said Harmony Gold in comments to its full year results on Thursday.
“We are therefore continuing studies to determine the feasibility of converting 5.7 million ounces in Mineral Resources to Mineral Reserves in the Free State region,” it added.
In results presentation today, Beyers Nel, chief operating office for Harmony said there were enough resources in the Free State section alone to mine for more than 100 years. Harmony has other surface resources in the West Wits region.
Asked about the potential of the Free State tailings project, Steenkamp said: “It won’t be as big as MWS as it doesn’t have the same water supply. But we are looking at what is its size with the sustainable water source available. We will have to build a sizeable TSF (tailings storage facility) and decide what is the right place to put the plant and what will it look like.
“We want to get a pre-feasibility and feasibility done this year so we can make a call in 2026,” he said. “It might be a bit of a stretch, but maybe by the middle of the half year we will make it.
“They are not big production,” he said of remining surface gold resources, “but they are really good assets to own. It you talk about Tshepong (another Harmony mine with comparable production volume) it is doing 200,000 oz at R1.1m AISC,” he said.
All things being equal, MWS will provide an estimated R900m in additional free cash flow to Harmony in the current financial year as a streaming agreement (which fixes the gold price received for Harmony) with Canadian firm Franco Nevada ends in the second quarter.
As a result of the less exposure to spot, Harmony received a price from MWS gold 18% below the average gold price received at its other operations.
Harmony spent R1.35bn at MWS in the 12 months under review and forecast spending another R1.2bn this year to complete an expansion of the TSF and bring a fourth stream and additional retreatment sources online.
