Jan 30, 2010

Briggs: Harmony drill outcomes thrilling


HARMONY GOLD says its current drill results at Wafi-Golpu project in Bulolo, Morobe province proves there are more gold and copper resources than the main Golpu area.
According to miningweekly.com the company reported that recent drilling conducted at the Golpu West prospect had indicated that intercepts at that deposit were significantly higher.

Golpu West is located off the western margin of the Golpu orebody and entirely outside of the existing resource limits. Drilling to date has defined approximately 160 metres of strike and the high-grade mineralisation remains open in all directions.

Harmony which is the world's fifth largest gold producer stated in a company announcement the drilling has recently uncovered over 100 million tons of combined gold and copper resources at 0.6 g/t gold and 1,1 percent copper for 2.93-million ounces of gold and 1.76-million tons of copper.

As part of its exploration program in the country the company confirmed that Golpu West drill results outline potential for a step-change impact on the minable resource base. This would provide a key driver to fundamentally alter the economics of the project.

"We are thrilled with the outcome of the drilling results at Golpu West. The results are very encouraging and highlight the fact that the Golpu system is poorly constrained at depth. Excellent potential exists for additional mineralised intrusions and/or structural repetitions around the margins," said Harmony CEO Graham Briggs.

Drilling to scope out the geometry and full extent of the new mineralised zone is continuing, with three exploration drill rigs. Two additional deep capacity rigs will arrive in mid-February to accelerate the work programme.

The South African based mining giant (Harmony) which has 50/50 Joint Venture with Australia's Newcrest Mining Limited expects that this drilling would significantly expand the current Golpu resource.

It said in a statement the 2007 Golpu prefeasibility study contemplated a block cave operation that would mine 100-million tons of ore and produce 1,7-million ounces gold and one-million tons of copper, over a ten-year life-of-mine.

Harmony noted that it was considered that a resource upgrade or significant change in upfront capital would be the most likely means to increasing the margin and lowering the risk profile for a favourable development decision.

The current schedule for the completion of the new resource model and progressing of the concept study is June.

Meanwhile, Trading Markets.com reports Harmony has been restructuring its operations to focus on lower-cost production, closing mature shafts at mines in South Africa.

It said it expects commercial levels of production at the Hidden Valley open-pit gold and silver mine in Papua New Guinea, being developed jointly with Australia's Newcrest Mining Ltd. (NCM.AU), during the March quarter of 2010.

Harmony's second-quarter results are scheduled to be released Feb. 8.

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