Harmony up 7% as punters bet Wafi-Golpu pre-feasibility will map out a Grasberg rival
On a generally good day for gold miners on Wednesday, ADRs of Harmony Gold Mining (NYSE:HMY) trading in New York led the charge adding near 7% by mid-afternoon.
Helped by a stronger bullion price – gold added more than $30 an ounce on the day – Johannesburg-based Harmony is now trading 10% above a 52-week low hit mid-May.
The $4 billion counter is still showing losses for 2012 – it is down 18% year to date compared to a 6.7% gain in the broader S&P 500 market index.
The market is anticipating great things from Wafi-Golpu, Harmony's 50-50 JV with Australia's Newcrest Mining in Papua New Guinea. Release of a pre-feasibility study for Wafi-Golpu is expected any day now and punters hope drilling results that put the deposit into the same league as Freeport-McMoran’s Grasberg mine across the border in West Papua, Indonesia are confirmed.
Harmony CEO Graham Briggs, who on Monday got his contract extended for a further four years, said last year Wafi-Golpu was a “game-changing asset” for the company. Bringing the project to production would cost around $4 billion and the company is considering selling forward some of the copper production to finance its part of the project.