Anglo faces headwinds in keeping restructuring on track
Anglo has been forced to accelerate its restructuring after successfully holding off a bid from BHP, the world’s biggest miner.
Newcrest Mining (ASX: NCM) and Harmony Gold (JESE: HAR) (NYSE: HMY) scored a win on Tuesday after Papua New Guinea’s national court dismissed a stay order on work relating to their Wafi-Golpu gold-copper project, which allows the partners to resume permitting talks with the government.
The proceeding had been requested by the governor of the Morobe province, where the project is located. He alleged he should have been consulted during the negotiation of the joint venture deal setting out the terms upon which the mine would be built.
The partners had been hoping to secure a mining lease for the $5.4bn Wafi-Golpu project early last year, but new administration brought delays in the permitting process
Negotiations hit a roadblock in September, when PNG demanded to keep 40% of the gold produced from Wafi-Golpu. The government then withdrew support for the memorandum of understanding, citing delays caused by legal proceedings.
Newcrest and Harmony had been hoping to secure a mining lease for the $5.4 billion deposit early last year.
The 50-50 partners said they were looking forward to re-engaging with national authorities and progressing on discussions about the special mining licence.
“The Wafi-Golpu Joint Venture is well placed to resume discussions with the PNG Government, given the constructive progress already made on the various agreements required for completion,” Harmony Gold chief executive, Peter Steenkamp, said in a separate statement.
Located near the port city of Lae, in the Morobe province, Wafi-Golpu is expected to take about five years from the grant of the mining lease to the time it generates its first ore.
At peak production, the mine is forecast to churn out 320,000 ounces of gold and 150,000 tonnes of copper a year.
