JOINT venture partners Harmony Gold and Newcrest Mining believe that the cost for stage one of the Wafi-Golpu Gold-Copper Project in Morobe Province will be substantially less than the $US4.8 billion suggested in the original preliminary feasibility study into the project’s development. New figures were to be released in an updated pre-feasibility study (PFS) which was due to be released in late December.

The original PFS, released in 2012, deterred investors because of the size of investment required to get the project into production. Apart from the upfront cost, the original PFS pointed to life-of-mine capital costs of more than $US9 billion.

Harmony’s chief executive officer Graham Briggs told a recent investor event in the US that the stage one cost would be far more achievable and that funding for the development by the 50:50 JV partners would not be an issue.

Wafi is a 7.2 million ounce gold resource that sits adjacent to the Golpu deposit. Wafi-Golpu is a world-class resource of 26.6 million ounces of gold and 9 million tonnes of copper.

During a Harmony presentation in Johannesburg Graham Briggs said that a conceptual study report on four high-grade, sub-level cave start-up mine options had progressed to the PFS. He said with the completion of the 2014 Golpu resource definition drilling program, scalable mine options of between 2.5 million tonnes and 5 million tonnes a year were selected for progression to PFS level.

Targeted outcomes from the Golpu study are to look at a modular expandable plant solution, a lower total capital cost using sub-level caving, as opposed to block caving to extract the high grade, as well as a scalable start-up mine and infrastructure development that is flexible enough to allow for expansion.

Golpu will require less capital to start up and has the potential for a long life that will be flexible and adaptable in multiple price cycles.

First exploration dates back to a nationwide porphyry copper search by CRA Exploration and the discovery and delineation of the Wafi A zone gold mineralization in the early 1980s. The first hole into the Golpu porphyry copper-gold mineralization was drilled in 1990 as part of a JV between Elders and CRA Exploration. Both successively divested from the project with various owners between 1994 and 2003 including Aurora and Abelle.

Harmony assumed control of the Wafi project by way of its acquisition of Abelle in 2003, and in 2008 entered into a JV arrangement with Newcrest in mid-2009. The project is 65km from the port of Lae. It is easily accessed by sealed road to Timini/Demakwa and then via a 38km dirt base track to the project.