Hidden Valley - Morobe Mining Joint Venture

Hidden Valley
September 2011
Overview
Hidden Valley Mine Joint Venture (HVJV) is
one of three separate 50:50 joint ventures
between subsidiaries of Harmony Gold
Mining Company Limited and Newcrest
Mining Limited. The three joint ventures,
collectively referred to as the Morobe
Mining Joint Ventures (MMJVs), were
formed for the purposes of exploring,
developing and operating mines in the
Morobe Province in Papua New Guinea.
The HVJV owns and operates the Hidden
Valley gold mine.
Vision & Mission
MMJV Vision is to: “Create a world class
mineral province in PNG.”
Tailings Storage Facility
Ridge line camp
Hidden Valley Kaveroi (HVK) pit
MMJV Mission is: “Discovering, developing
and operating gold mines in Morobe
Province to build a sustainable long term
business to benefit all our stakeholders.”
History
CRA Exploration discovered the Hidden
Valley prospect in 1984 and the adjacent
Kaveroi prospect in 1992. The Hamata
prospect was discovered in 1987 by RGC.
The properties were bought by Harmony
in 2003 and in 2008,
Morobe Mining Joint Venture Tenements &
Project Locations.
Quick Facts
• Ownership - 50:50 Joint
Venture between Harmony
Gold Mining Company Limited
and Newcrest Mining Limited.
• Open pit gold/silver mine
• Mineral Resource - 103 Million
tonnes containing 5.6 Million
ounces Gold & 102 million
ounces silver.
• At full production capacity will
generate ~ 250 000 ounces
gold and 4 million ounces of
silver per year
• Current Employment: >2000
permanent employees &
contractors - > 90% PNG
workforce
• June 2009 first gold poured
• Current life of mine - 14 years
Aerial overview of the Hidden Valley Gold Operations.
Harmony and Newcrest announced the formation of the HVJV. Newcrest completed
its earn-in to the 50:50 joint venture in 2009.
Geography & Location
The Hidden Valley Mine is an open pit, gold/silver mine located in the Wau Bulolo District
of Morobe Province, PNG. It is located approximately 210 kilometers northwest of Port
Moresby, the capital of PNG and 90 kilometers southwest of Lae in the mountainous
ridge inland from the northern coast of Papua New Guinea. It is at latitude 7.42ºS and
longitude 146.67ºE.
An elevation of around 2,500m above sea level provides a much cooler climate than
the coastal regions of PNG. The surrounding country is mountainous with woodland
and rainforest that is used for low level agriculture.
The climate of PNG is warm tropical with temperatures generally ranging from 20 to 30
degrees Celsius across the majority of the country, with only minor diurnal variations.
At Hidden Valley the temperature ranges from around 12 degrees (at night) to 31
degrees Celsius (during dry and hot days). Like other parts of PNG, Hidden Valley is
subject to high amounts of rainfall and thunderstorms during the year. The average
annual rainfall at Hidden Valley is between 2300-2500mm per year.
Resources and Reserves
The Hidden Valley deposits consist of 3 main lodes. Hidden Valley and Kaveroi deposits
occur adjacent to each other at approximately 2450mRL and the Hamata deposit occurs
2.5km northwest at approximately 1850mRL.
The deposits have been a focus of extensive Resource Development activities since
the early 1990’s.
Hidden Valley and Hamata contain a Mineral Resource of 103Mt containing 5.6 Moz
gold and 102 Moz silver.
Hidden Valley and Hamata contain an ore reserve of 62 million tonnes containing 3.7
million ounces of gold and 64 million ounces of silver.
The Joint Ventures have an active exploration program in adjacent country, which based
on the history of gold mining in the district, is considered to be highly prospective.
Hidden Valley Mining & Processing Operations
Construction of the Hidden Valley mine began in 2007 with the bulk of the work
completed towards mid 2009. First gold was poured in June 2009 and the project is still
in the process of ramping up operations to the required design capacity.
Annual production at Hidden Valley mine is expected to be more than 250 000 ounces
of gold and 4 million ounces of silver. When the process plant is operating at full design
capacity, Hidden Valley which currently has a 14-year mine life, will process an estimated
4.6 million tonnes of ore annually from two open pits located approximately 5 kilometers
apart: the smaller Hamata pit which exploits the Hamata gold ore body and the larger
pit which exploits the Hidden Valley and Kaveroi (HVK) gold and silver ore bodies.

Hidden Valley
September 2011
Employment
The Hidden Valley mine operates in
accordance with a Memorandum of
Agreement (MoA) between HVJV, local
landowners and all levels of government.
This agreement sets out a preference
for employment of landowner and local
residents ahead of those from other
provinces and offshore employees
when qualifications and experience are
equivalent.
As per the MoA, employees are
categorised into five tiers:
Tier 1 – Landowners
Tier 2 – Wau/ Bulolo residents
Tier 3 – Morobe residents
Tier 4 – PNG Citizens
Tier 5 – Non-Citizens
Mum to miner: Hidden Valley is providing employment opportunities in non-traditional
roles for more local women.
Most employees live in the accommodation
village on site while in the work period of
their rosters.
About 15% of the total permanent
workforce at Hidden Valley are women.
Ninety percent are from PNG, and over
half come from local communities.
Environment
Hidden Valley mine is the first mining project in PNG to be completely
permitted by the Department of Environment & Conservation under the new
Environment Act 2000. It is also the first major PNG mining project to have
built a structurally engineered tailings storage facility that contains all tailings.
The Environmental Permit for the mine development was issued to HVJV in
March 2005 following submission of a comprehensive Environmental Impact
Statement (EIS) along with a detailed Environmental Management Plan
(EMP). The approval process involved extensive stakeholder consultation,
including local landowners as well as all levels of local, provincial and
national government.
Landowner Business Opportunities
Local Landowner Company, NKW Holdings Limited was set up in 2004 to
help the landowners participate in commercial opportunities. The company’s
business activities include self managed contracts in the areas of bus
transportation, labour hire and management, and business joint ventures
in freight, catering, plant and equipment hire, and security. The company
receives over K60 million worth of contracts per year and has a current
market value of over K20 million. NKW Holdings Limited represents the land
owner villages of Nauti, Kwembu and Winima.
Community & Regional Development
A comprehensive Community & Regional Development program has been
initiated to address long term social and community development needs
amongst the communities impacted by the operation. The plan has prioritised
agriculture as the long term objective, with an initial focus on community
water supplies, education and health and infrastructure projects.
A key element of the plan is to develop long term partnerships with the Morobe
Provincial Government and local NGO groups to encourage local ownership
of initiatives and ensure the sustainability of development outcomes.
For more information, visit our website at www.morobejv.com
Stakeholder consultation and dialogue is an important
part of our social responsibility.
Quick Facts
• Landowner communities get first
preference in employment as per the
Hidden Valley MoA.
• Females make up 15% of the current
2000 plus permanent employees and
contractors at Hidden Valley.
• Extensive environmental and
community relations policy and
programs.
• Over K60 million worth of contracts
provided to local Landowner business
group, NKW Holdings Limited annually.
• Comprehensive Community &
Regional Development plan initiated.