Harmony's $1bn (R18bn) copper deal a 'sweet spot' for the company
South Africa's biggest gold producer Harmony Gold estimates that by the 2035 financial year, 45% of its production will come from Australasia after agreeing to buy Australia's Mac Copper for $1bn (R18.42bn).
The MAC Copper acquisition is its second foray into copper after buying the Eva Copper project in Queensland in 2022, a mine that is likely to produce up to 60,000 tonnes of the metal a year from 2029.
CEO Beyers Nel said MAC Copper's CSA Copper mine in New South Wales, which produces 40,000 tonnes of the metal a year, represented a 'sweet spot' for the group.
'There is a scramble for copper mines in the market at the moment, people pay top dollar. But we believe because this mine is a deeper mine — it is more of a mine that suits Harmony's skills set — it potentially kept other bidders out of the mine.
'It is too big for the juniors and probably too small for the majors. The 40,000 tonnes of copper from a size point of view is ideal and a sweet spot for a company like Harmony to take it. It is production from day one because it is an operating mine. It is also in a tier-one mining jurisdiction; New South Wales in Australia is a good place to mine,' said Nel.
Nel said the shift enhanced profitability, reduced geographical concentration risks, and positioned Harmony to deliver sustainable long-term returns.
He said the mine also presented near-term copper into Harmony's production mix as opposed to its Eva project in Australia and Walfi-Golpu, a gold/copper project in Papua New Guinea (PNG) it jointly owns with Newmont Corp.
He said the Walfi-Golpu project had been frustratingly slow. However despite violence at Barrick Gold Corporation's Porgera Gold Mine in Papua New Guinea's Enga province, the area was calm.
'I would not say there are problems there. It is calm. People sometimes throw one blanket over Papua New Guinea and think what is happening at Porgera with Barrick is happening everywhere in Papua New Guinea. That is not the case. Where our mine is, things are calm and the communities are supportive of the mine,' he said.
The Harmony share traded 6% lower after the announcement this week. Nel said the market still needs to digest the deal.
'It is still $1bn, it's a lot of money. It is typical that when a big transaction takes place that the buying company's share price comes under pressure.
'We are not fixated about the day trade, we think this is a good asset for Harmony's skills set and we can add a lot of value to it, there is a lot of blue sky, upside potential beyond the current mine life. We are very bullish about the copper price long term. if you think about the global energy transition and supply and demand. We need to look at the long-term perspective.'
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The Herald
2 days ago
- The Herald
Harmony's $1bn (R18bn) copper deal a 'sweet spot' for the company
South Africa's biggest gold producer Harmony Gold estimates that by the 2035 financial year, 45% of its production will come from Australasia after agreeing to buy Australia's Mac Copper for $1bn (R18.42bn). The MAC Copper acquisition is its second foray into copper after buying the Eva Copper project in Queensland in 2022, a mine that is likely to produce up to 60,000 tonnes of the metal a year from 2029. CEO Beyers Nel said MAC Copper's CSA Copper mine in New South Wales, which produces 40,000 tonnes of the metal a year, represented a 'sweet spot' for the group. 'There is a scramble for copper mines in the market at the moment, people pay top dollar. But we believe because this mine is a deeper mine — it is more of a mine that suits Harmony's skills set — it potentially kept other bidders out of the mine. 'It is too big for the juniors and probably too small for the majors. The 40,000 tonnes of copper from a size point of view is ideal and a sweet spot for a company like Harmony to take it. It is production from day one because it is an operating mine. It is also in a tier-one mining jurisdiction; New South Wales in Australia is a good place to mine,' said Nel. Nel said the shift enhanced profitability, reduced geographical concentration risks, and positioned Harmony to deliver sustainable long-term returns. He said the mine also presented near-term copper into Harmony's production mix as opposed to its Eva project in Australia and Walfi-Golpu, a gold/copper project in Papua New Guinea (PNG) it jointly owns with Newmont Corp. He said the Walfi-Golpu project had been frustratingly slow. However despite violence at Barrick Gold Corporation's Porgera Gold Mine in Papua New Guinea's Enga province, the area was calm. 'I would not say there are problems there. It is calm. People sometimes throw one blanket over Papua New Guinea and think what is happening at Porgera with Barrick is happening everywhere in Papua New Guinea. That is not the case. Where our mine is, things are calm and the communities are supportive of the mine,' he said. The Harmony share traded 6% lower after the announcement this week. Nel said the market still needs to digest the deal. 'It is still $1bn, it's a lot of money. It is typical that when a big transaction takes place that the buying company's share price comes under pressure. 'We are not fixated about the day trade, we think this is a good asset for Harmony's skills set and we can add a lot of value to it, there is a lot of blue sky, upside potential beyond the current mine life. We are very bullish about the copper price long term. if you think about the global energy transition and supply and demand. We need to look at the long-term perspective.' TimesLIVE
TimesLIVE
3 days ago
- TimesLIVE
Harmony's $1bn (R18bn) copper deal a 'sweet spot' for the company
South Africa's biggest gold producer Harmony Gold estimates that by the 2035 financial year, 45% of its production will come from Australasia after agreeing to buy Australia's Mac Copper for $1bn (R18.42bn). The MAC Copper acquisition is its second foray into copper after buying the Eva Copper project in Queensland in 2022, a mine that is likely to produce up to 60,000 tonnes of the metal a year from 2029. CEO Beyers Nel said MAC Copper's CSA Copper mine in New South Wales, which produces 40,000 tonnes of the metal a year, represented a 'sweet spot' for the group. 'There is a scramble for copper mines in the market at the moment, people pay top dollar. But we believe because this mine is a deeper mine — it is more of a mine that suits Harmony's skills set — it potentially kept other bidders out of the mine. 'It is too big for the juniors and probably too small for the majors. The 40,000 tonnes of copper from a size point of view is ideal and a sweet spot for a company like Harmony to take it. It is production from day one because it is an operating mine. It is also in a tier-one mining jurisdiction; New South Wales in Australia is a good place to mine,' said Nel. Nel said the shift enhanced profitability, reduced geographical concentration risks, and positioned Harmony to deliver sustainable long-term returns. He said the mine also presented near-term copper into Harmony's production mix as opposed to its Eva project in Australia and Walfi-Golpu, a gold/copper project in Papua New Guinea (PNG) it jointly owns with Newmont Corp. He said the Walfi-Golpu project had been frustratingly slow. However despite violence at Barrick Gold Corporation's Porgera Gold Mine in Papua New Guinea's Enga province, the area was calm. 'I would not say there are problems there. It is calm. People sometimes throw one blanket over Papua New Guinea and think what is happening at Porgera with Barrick is happening everywhere in Papua New Guinea. That is not th e case. Where our mine is, things are calm and the communities are supportive of the mine,' he said. The Harmony share traded 6% lower after the announcement this week. Nel said the market still needs to digest the deal. 'It is still $1bn, it's a lot of money. It is typical that when a big transaction takes place that the buying company's share price comes under pressure. 'We are not fixated about the day trade, we think this is a good asset for Harmony's skills set and we can add a lot of value to it, there is a lot of blue sky, upside potential beyond the current mine life. We are very bullish about the copper price long term. if you think about the global energy transition and supply and demand. We need to look at the long-term perspective.'
The Herald
3 days ago
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SCA dismisses 'meritless' appeal by two environmental organisations
Because the company required the water use licencee to commence mining, it engaged various experts and obtained several specialist reports, including a hydrological, socioeconomic, geohydrology impact and a biodiversity baseline and impact assessment. It also obtained a numerical groundwater model report and conducted a public participation process as part of the application for the licence. These assessments informed the licencee conditions. In July 2016 the director-general (DG) of the department of water & sanitation issued the licence, valid for 15 years, to Atha-Africa. The licencee authorised specified water-use activities in relation to the mining to be conducted. In the same year, the two organisations appealed the DG's decision to issue the licence to the Water Tribunal. They claimed, among others, that the DG failed to consider the effect of the proposed water use on the water resource; that the DG failed to authorise certain water uses associated with the closure of the mine; that the consent of the owner of a farm regarding the use of underground water had not been obtained; and that the DG failed to apply environmental principles in the National Environmental Management Act. In 2019, the tribunal dismissed the appeal, concluding, among others, that the findings and scientific reviews by the appellants' experts were unsubstantiated and were demonstrated in evidence to be shallow. The tribunal found that sound methods were used in the Atha-Africa's wetland and hydrological studies. The SCA said the organisations appealed the tribunal's decision to the Pretoria high court in terms of section 149(1) of the NWA, which permits an appeal only on a question of law. The high court dismissed the organisations' appeal with costs. The SCA granted the appellants special leave to appeal. The SCA found in its judgment that most of the appeal grounds did not raise questions of law. It said these were questions of fact based on the evidence before the tribunal, and could not form the subject of an appeal in terms of the NWA. 'The appeal lodged by the appellants has little or no basis in law.' The court also noted the appellants lodged the appeal regardless of the consequences, including the inconvenience to and exorbitant costs that would be incurred by the department and Atha-Africa. The court said in 2011, Atha-Africa was invited to invest in South Africa. It has made an investment of US$40m in equity and prospecting rights to engage in coal mining. It has spent US$61m solely on specialist studies, to secure the necessary authorisations. 'More than 10 years later no mining has started and (Atha-Africa) has not realised any return on its investment.' TimesLIVE
