PATRICE Motsepe sought to give Harmony Gold’s Papua New Guinea ambitions a much-needed push after meeting with the Oceania nation’s president James Marape earlier this week.
The South African gold producer announced in April it has signed a memorandum of understanding with the PNG regarding the development of Wafi Golpu, a copper and gold deposit. Harmony shares the project with joint venture partner Newmont Corp. following the US firm’s takeover of Newscrest Mining.
Wafi Golpu has been on Harmony’s books for more than a decade but its development has been repeatedly interrupted by changes in government and policy. The MoU however is seen as an important precursor to a special mining lease which will set down the potential equity participate of Marape’s government as well as fiscal rules.
Harmony said on Monday discussions between Motsepe and Marape, as well as the gold producer’s CEO Peter Steenkamp were held on July 26 “to continue discussions on permitting” Wafi Golpu. “We look forward to the finalisation of the various agreements that will underpin the project’s Special Mining Lease and participating in the subsequent project development,” said Steenkamp.
In a 2018 feasibility study the total project capital for Wafi Golpu was estimated at $5.38bn, down $1bn from a study in 2016. The project was forecast to produce average annual gold production of 266,000 ounces and copper of 161,000 tons. The life of mine of the project was cut to 28 years in the 2018 study from 35 years previously.
Motsepe and Steenkamp are the latest to walk through Marape’s doors which have recently seen visited from high ranking dignitaries including Indian prime minister Narendra Modi and Indonesia’s president Joko Widodo. In addition to the country’s copper and gold resources, it also has signficant reserves of liquified natural gas.
For the US, however, PNG also occupies a strategically important position in the Pacific Ocean as it provides a counterpoint to the Solomon Islands which signed a security pact with China last year. President Biden recently called off a personal visit to PNG but sent lieutenants Antony Blinken, American secretary of state who signed a defence cooperation agreemenet with PNG, followed by Lloyd Austin, American defence secretary.
According to the Economist, the UK publication, PNG has “again become a geopolitical prize, this time in the contest between America and China.
