Harmony logo Annual Report 2009 Annual Report 2009

Contents

Mineral resources and
ore reserves

As of 30 June 2009, Harmony reported ore reserves of 48.2 million ounces and mineral resources of 215.7 million ounces. The Measured and Indicated mineral resources are inclusive of those resources modified to produce the ore Reserves. Ore reserves are reported as mill delivered tonnes at the grade delivered to the mill. Of the company’s 48.2 million ounces of ore reserves, 11.8 million ounces are classified as being below infrastructure, i.e. capital expenditure for the development of these has yet to be approved.

We use certain terms in this report such as ‘measured’, ‘indicated’ and ‘inferred’ resources, which the SEC guidelines strictly prohibit US-registered companies from including in their filings with the SEC. US investors are urged to consider closely the disclosure in our Form 20-F (PDF - 4.53MB).

Commodity prices

A gold price of US$750/oz was used for the conversion of mineral resources to ore reserves at our South African and Papua New Guinea operations. An exchange rate of R9.33/U$ for South Africa and A$/US$0.75 for Papua New Guinea has been used, resulting in a gold price of R225 000/kg and A$1000/oz respectively.

Auditing

The Harmony mineral resources and ore reserves have been comprehensively audited by a team of internal competent persons that operates independently of the operating units. The internal audit team verifies compliance with the Harmony Code of Resource blocking, valuation, classification, cut-off calculations, development of life-of-mine plans and SAMREC sheets which support Harmony’s Annual Mineral Resource and Ore Reserve statement. This audit process is specifically designed to comply with the requirements for internationally recognised procedures and standards such as:

  • South African Code for Reporting Mineral Resources and Mineral Reserves – SAMREC Code
  • Australian Code for Reporting Mineral Resources and Ore Reserves – JORC Code
  • Industry Guide 7 of the United States Securities Exchange Commission
  • Sarbanes-Oxley requirements

In addition to the internal audits, Harmony made use of SRK Consulting to review the gold mineral resources and reserves at all its South African operations.

Competent person’s declaration

Harmony employs an ore reserve manager at each of its operations who takes responsibility for the reporting of the mineral resources and ore reserves of the mines for which they are responsible. The competent person responsible for the overall preparation and reporting of the company’s mineral resources and ore reserves in South Africa is Jaco Boshoff (BSc (Hons), MSc (Geology), MBA. Pri.Sci.Nat), who has 14 years’ relevant experience, and is registered with the South African Council for Natural Scientific Professions (SACNASP).

The competent person responsible for Papua New Guinea and Australia is Greg Job (BSc, MSc (Min Econ), MAusIMM). Greg has 21 years’ experience in mine and resource geology, and is a member of the Australian Institute of Mining and Metallurgy.

Jaco Boshoff
Greg Job

Reconciliation FY08/FY09

Mineral resources

Year-on-year, the mineral resources had a negative variance of 40.6 million ounces. This was mainly as a result of the equity adjustment for Papua New Guinea (69.9% down to 50% attributable to Harmony) as well as stating the mineral resources for the South African underground operations at a gold price of R350 000/kg and not at a resource cut-off of 250cmg/t.

Ore reserves

There was a year-on-year negative variance of 2.3 million ounces with respect to the ore reserves. As indicated in the table below, Harmony’s ore reserves as at 30 June 2009 reflected a year-on-year depletion of 1.6 million ounces. The equity adjustment at Papua New Guinea from 69.9% to 50% attributable to Harmony resulted in a further decrease of 0.9 million ounces. The net effect of positive changes at the South African operations accounted for an addition of 0.2 million ounces.

Ore reserve reconciliation: FY08 to FY09

 Gold (tonnes)Gold (Moz)
Balance as at June 20081 57050.5
Reductions   
  Mined during FY2009(50)(1.6)
  Equity adjustment (PNG)(28)(0.9)
  Geology and scope changes(78)(2.5)
Additions   
  Surface sources341.1
  Other adjustments501.6
Balance as at June 20091 49948.2
Ore reserve sensitivities

The graph above illustrates ore reserve sensitivities, inclusive of projects below infrastructure and surface sources, to a changing gold price below and above R225 000/kg. Note that these sensitivities are approximations only and based on the orebodies in the current life of mine plans and pre-feasibility studies. Accordingly, at different gold prices, alternative mining strategies may be pursued, including the addition of more secondary reef horizons into reserves.

Summary tables: Harmony’s mineral resources and ore reserves

Location of Harmony’s South African and PNG assets

Location of Harmony’s South African and PNG assets

South Africa underground (excluding below infrastructure)

Increasing level of geoscientific knowledge and confidence
Mineral resources (total)
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
854.66.185 278169 686

Reported as in situ mineralisation estimates

 
Ore reserves (total)
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
131.36.2181426 169

Reported as mineable production estimates

 
Inferred
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
565.85.252 97295 557
 
Indicated
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
156.88.18 1 28341 242
Arrow pointing left and right
Probable
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
82.86.46 53417 183
 
Measured
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
132.07.751 02332 887
Arrow pointing left and right
Proven
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
48.55.782808 986
 

Consideration of mining, metallurgical, economic, marketing, legal, environmental, social and governmental factors (the modifying factors).

long arrow
 

South Africa projects (below infrastructure)

Increasing level of geoscientific knowledge and confidence
Mineral resources (total)
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
104.57.41 77424 894

Reported as in situ mineralisation estimates

 
Ore reserves (total)
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
49.47.4536911 849

Reported as mineable production estimates

 
Inferred
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
38.74.19163 5 228
 
Indicated
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
65.89.3061119 666
Arrow pointing left and right
Probable
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
49.47.4536911 849
 
Measured
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
Arrow pointing left and right
Proven
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
 

Consideration of mining, metallurgical, economic, marketing, legal, environmental, social and governmental factors (the modifying factors).

long arrow
 

South Africa surface (including Kalgold)

Increasing level of geoscientific knowledge and confidence
Mineral resources (total)
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
1 313.60.3241513 357

Reported as in situ mineralisation estimates

 
Ore reserves (total)
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
968.40.262508 036

Reported as mineable production estimates

 
Inferred
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
228.90.32 732 359
 
Indicated
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
208.00.52 1093 502
Arrow pointing left and right
Probable
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
110.70.32361 152
 
Measured
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
876.70.272337 496
Arrow pointing left and right
Proven
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
857.70.252146 884
 

Consideration of mining, metallurgical, economic, marketing, legal, environmental, social and governmental factors (the modifying factors).

long arrow
 

Papua New Guinea*

Increasing level of geoscientific knowledge and confidence
Mineral resources (total)
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
198.51.22243 7 790

Reported as in situ mineralisation estimates

 
Ore reserves (total)
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
56.4 1.1665 2 096

Reported as mineable production estimates

 
Inferred
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
92.81.00932 979
 
Indicated
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
102.71.401444 604
Arrow pointing left and right
Probable
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
54.91.12621 984
 
Measured
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
3.02.166207
Arrow pointing left and right
Proven
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
1.52.323112
 

Consideration of mining, metallurgical, economic, marketing, legal, environmental, social and governmental factors (the modifying factors).

long arrow

* Represents Harmony’s equity portion of 50%

 

Total underground and surface (including below infrastructure)

Increasing level of geoscientific knowledge and confidence
Mineral resources (total)
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
2 471.22.726 710215 727

Reported as in situ mineralisation estimates

 
Ore reserves (total)
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
1 205.51.241 49848 150

Reported as mineable production estimates

 
Inferred
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
926.23.563 301106 123
 
Indicated
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
533.34.032 14769 014
Arrow pointing left and right
Probable
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
297.83.361 00132 168
 
Measured
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
1 011.71.251 26240 590
Arrow pointing left and right
Proven
Tonnes (Mt)Grade
g/t
Gold
(000kg)
Gold
(000oz)
907.70.5549715 982
 

Consideration of mining, metallurgical, economic, marketing, legal, environmental, social and governmental factors (the modifying factors).

long arrow

Gold – Mineral resources statement (Metric)

 MeasuredIndicatedInferredTotal
SA UndergroundTonnes
(Mt)
Grade
g/t
Gold
(000kg)
Tonnes
(Mt)
Grade
g/t
Gold
(000kg)
Tonnes
(Mt)
Grade
g/t
Gold
(000kg)
Tonnes
(Mt)
Grade
g/t
Gold
(000kg)
Bambanani11.411.201276.49.67623.89.023421.610.36223
Joel4.36.44283.96.822712.36.508020.56.55135
Masimong14.07.5510614.96.5197100.36.69671129.26.76874
Phakisa            
  Phakisa0.29.72222.112.2927257.87.0240580.18.48679
  Nyala4.46.91313.94.76188.35.9149
  Total4.67.033326.011.1729057.87.0240588.48.24728
Target6.39.816213.97.651065.26.263225.47.90200
Tshepong14.011.0315414.311.3216213.88.8512242.110.42438
Virginia            
  Harmony 210.24.75487.13.302477.13.6728294.43.76354
  Merriespruit 18.55.20453.85.252039.64.1916651.94.43231
  Merriespruit 38.85.25462.84.91147.04.082918.64.7689
  Unisel11.25.566212.04.735620.64.659743.84.90215
Brand 34.16.78284.16.912910.05.155118.25.91108
Total42.85.3522929.84.77143154.34.05625226.94.39997
Doornkop            
  Doornkop Kimberley Reef9.13.27306.82.6418159.72.51401175.62.56449
  Doornkop South Reef0.65.9931.36.23822.58.6319424.48.44205
  Total9.73.43338.13.2326182.23.27595200.03.27654
Elandsrand11.68.8710328.28.632431.49.281341.28.72359
Evander            
  Evander operations           
  Evander 2/57.710.62812.010.47216.511.367516.210.90177
  Evander 71.912.08230.19.28113.910.9115115.911.04175
  Evander 83.711.96449.211.3710514.311.7916927.211.67318
  Sub-total13.311.2014811.311.812734.711.3639559.311.29670
  Evander (below infrastructure)          
  Evander South21.15.4611533.83.9813554.94.55250
  Rolspruit29.111.593374.95.692834.010.74365
  Poplar15.610.2115915.610.21159
  Sub-total65.89.3061138.74.19163104.57.41774
  Total13.311.2014877.19.5873873.47.58558163.88.811 444
Total SA Underground132.07.751 023222.68.511 894604.55.193 135959.16.316 052
SA Surface
Kalgold34.50.933266.00.946228.40.9527128.90.94121
Free State Surface           
  Phoenix130.80.27365.30.261136.10.2737
  St Helena289.60.2572289.60.2572
  Other421.80.2293142.00.3347195.20.2345759.00.24185
  Total842.20.24201142.00.3347200.50.23461 184.70.25294
Total SA Surface876.70.27233208.00.52109228.90.32731 313.60.32415
Total SA1 008.7 1 256430.6 2 003833.4 3 2082 272.7 6 467
Papua New Guinea 1
Hidden Valley and Kaveroi2.82.16623.11.894414.81.532340.71.7873
  Hamata0.22.203.92.3490.62.5824.72.3711
  Wafi31.91.976319.81.733451.71.8897
  Golpu43.80.632837.70.491881.50.5746
  Nambonga19.90.791619.90.7916
Total Papua New Guinea3.02.166102.71.4014492.81.0093198.51.22243
GRAND TOTAL1 011.7 1 262533.3 2 147926.2 3 3012 471.2 6 710

Uranium – Mineral resources statement (Metric)

 MeasuredIndicatedInferredTotal
 TonnesGradeU3O8 kgTonnesGradeU3O8 kgTonnesGradeU3O8 kgTonnesGradeU3O8 kg
Operations(million)(kg/t)(million)(million)(kg/t)(million)(million)(kg/t)(million)(million)(kg/t)(million)
Free State Surface            
  Free State358.80.093336.50.10468.40.075463.70.0942
Total SA Surface358.80.093336.50.10468.40.075463.70.0942

Silver – Mineral resources statement (Metric)

 MeasuredIndicatedInferredTotal
 TonnesGradeSilver kgTonnesGradeSilver kgTonnesGradeSilver kgTonnesGradeSilver kg
Operations(million)(g/t)(000)(million)(g/t)(000)(million)(g/t)(000)(million)(g/t)(000)
Papua New Guinea 1            
  Hidden Valley and Kaveroi2.840.5211423.133.9578514.827.3840640.732.011 305

Copper – Mineral resources statement (Metric)

 MeasuredIndicatedInferredTotal
 TonnesGradeCu kgTonnesGradeCu kgTonnesGradeCu kgTonnesGradeCu kg
Operations(million)(%)(million)(million)(%)(million)(million)(%)(million)(million)(%)(million)
Papua New Guinea 1            
  Golpu43.81.3960937.70.7227281.51.08881
  Nambonga19.90.214219.90.2142
Total43.81.3960957.60.54314101.50.91923

Molybdenum – Mineral resources statement (Metric)

 MeasuredIndicatedInferredTotal
 TonnesGradeMo kgTonnesGradeMo kgTonnesGradeMo kgTonnesGradeMo kg
Operations(million)(ppm)(million)(million)(ppm)(million)(million)(ppm)(million)(million)(ppm)(million)
Papua New Guinea 1            
  Golpu43.8110.00537.7157.00681.5131.7511

1 Represents Harmony's equity portion of 50%
Note: 1 tonne = 1 000 kg = 2 204 lbs

Gold – Mineral resources statement (Imperial)

 MeasuredIndicatedInferredTotal
SA UndergroundTons
(million)
Grade
(oz/ton)
Gold oz
(000)
Tons
(million)
Grade
(oz/ton)
Gold oz
(000)
Tons
(million)
Grade
(oz/ton)
Gold oz
(000)
Tons
(million)
Grade
(oz/ton)
Gold oz
(000)
Bambanani12.50.3274 0877.10.2821 9934.20.2631 10123.80.3027 181
Joel4.80.1888954.30.19985513.60.1902 58022.70.1914 330
Masimong15.40.2203 40116.50.1903 128110.60.19521 576142.50.19728 105
Phakisa            
  Phakisa0.20.2856524.40.3588 74563.70.20513 03688.30.24721 846
  Nyala4.90.2019854.30.1395929.20.1721 577
  Total5.10.2051 05028.70.3269 33763.70.20513 03697.50.24023 423
Target7.00.2861 99115.30.2233 4125.70.1821 04328.00.2306 446
Tshepong15.40.3224 94915.80.3305 21115.20.2583 92246.40.30414 082
Virginia            
  Harmony 211.20.1391 5597.90.09675784.90.1079 082104.00.11011 398
  Merriespruit 19.40.1521 4214.10.15363543.70.1225 33457.20.1297 390
  Merriespruit 39.70.1531 4913.10.1434367.70.11991720.50.1392 844
  Unisel12.30.1621 98913.30.1381 82822.70.1363 08648.30.1436 903
  Brand 34.60.1988924.50.20191611.00.1501 65020.10.1723 458
  Total47.20.1567 35232.90.1394 572170.00.11820 069250.10.12831 993
Doornkop            
  Doornkop Kimberley Reef10.10.0959607.40.077574176.00.07312 893193.50.07514 427
  Doornkop South Reef0.60.1751131.50.18126524.80.2526 23926.90.2466 617
  Total10.70.1001 0738.90.094839200.80.09519 132220.40.09521 044
Elandsrand12.80.2593 31331.00.2527 8121.60.27043145.40.25411 556
Evander            
  Evander operations           
  Evander 2/58.50.3102 6182.20.3056787.20.3312 38617.90.3185 682
  Evander 72.10.3537540.20.2684415.30.3184 85717.60.3225 655
  Evander 84.00.3491 40410.10.3323 36115.80.3445 42429.90.34010 189
  Sub-total14.60.3274 77612.50.3264 08338.30.33112 66765.40.32921 526
 Evander (below infrastructure)          
  Evander South23.20.1593 69637.30.1164 32660.50.1338 022
  Rolspruit32.10.33810 8475.40.16690237.50.31311 749
  Poplar17.20.2985 12317.20.2985 123
  Sub-total72.50.27119 66642.70.1225 228115.20.21624 894
  Total14.60.3274 77685.00.27923 74981.00.22117 895180.60.25746 420
Total SA Underground145.50.22632 887245.50.24860 908666.40.151100 7851 057.40.184194 580
SA Surface
Kalgold38.10.0271 03772.70.0282 00231.30.028871142.10.0283 910
Free State Surface           
  Phoenix144.10.0081 1485.90.00844150.00.0081 192
  St Helena319.20.0072 327319.20.0072 327
  Other465.00.0062 984156.50.0101 500215.10.0071 444836.60.0075 928
  Total928.30.0076 459156.50.0101 500221.00.0071 4881 305.80.0079 447
Total SA Surface966.40.0087 496229.20.0153 502252.30.0092 3591 447.90.00913 357
Total SA1 111.9 40 383474.7 64 410918.7 103 1442 505.3 207 937
Papua New Guinea 1
Hidden Valley and Kaveroi3.10.06319525.50.0551 40916.30.04573044.90.0522 334
  Hamata0.20.064124.20.0682910.70.075505.10.069353
  Wafi35.10.0572 01721.80.0501 09956.90.0553 116
  Golpu48.30.01888741.60.01459589.90.0161 482
  Nambonga21.90.02350521.90.023505
Total Papua New Guinea3.30.063207113.10.0414 604102.30.0292 979218.70.0367 790
GRAND TOTAL1 115.2 40 590587.8 69 0141 021.0 106 1232 724.0 215 727

Uranium – Mineral resources statement (Imperial)

 MeasuredIndicatedInferredTotal
 TonsGradeU3O8 lbsTonsGradeU3O8 lbsTonsGradeU3O8 lbsTonsGradeU3O8 lbs
Operations(million)(lbs/ton)(million)(million)(lbs/ton)(million)(million)(lbs/ton)(million)(million)(lbs/ton)(million)
Free State surface            
  Free State395.50.1827240.30.195875.40.14011511.20.17791
Total SA Surface395.50.1827240.30.195875.40.14011511.20.17791

Silver – Mineral resources statement (Imperial)

 MeasuredIndicatedInferredTotal
 TonsGradeSilver ozTonsGradeSilver ozTonsGradeSilver ozTonsGradeSilver oz
Operations(million)(oz/ton)(000)(million)(oz/ton)(000)(million)(oz/ton)(000)(million)(oz/ton)(000)
Papua New Guinea 1            
  Hidden Valley and Kaveroi3.11.1823 66825.50.99025 24616.30.79913 05444.90.93441 968

Copper – Mineral resources statement (Imperial)

 MeasuredIndicatedInferredTotal
 TonsGradeCu lbsTonsGradeCu lbsTonsGradeCu lbsTonsGradeCu lbs
Operations(million)(%)(million)(million)(%)(million)(million)(%)(million)(million)(%)(million)
Papua New Guinea 1            
  Golpu48.31.2611 34341.60.65359989.90.9801 942
  Nambonga21.90.1919221.90.19192
Total48.31.2611 34363.50.493691111.80.8252 034

Molybdenum – Mineral resources statement (Imperial)

 MeasuredIndicatedInferredTotal
 TonsGradeMo lbsTonsGradeMo lbsTonsGradeMo lbsTonsGradeMo lbs
Operations(million)(lbs/ton)(million)(million)(lbs/ton)(million)(million)(lbs/ton)(million)(million)(lbs/ton)(million)
Papua New Guinea 1            
  Golpu48.30.2201141.60.3141389.90.26324

1 Represents Harmony's equity portion of 50%

Note: 1 ton = 907 kg = 2 000 lbs

Gold – Ore reserves statement (Metric)

 Proven ReservesProbable ReservesTotal Reserves
SA UndergroundTonnes
(million)
Grade
g/t
Gold1
(000kg)
Tonnes
(million)
Grade
g/t
Gold1
(000kg)
Tonnes
(million)
Grade
g/t
Gold1
(000kg)
Bambanani3.58.48301.210.90 134.79.0943
Joel0.95.7452.25.52133.15.5818
Masimong4.55.20241.4 5.2775.95.2231
Phakisa         
  Phakisa0.35.38 120.18.1216320.48.08164
  Nyala0.14.0110.03.370.13.821
  Total0.4   4.98220.18.1116320.58.05165
Target4.86.10299.0 5.605013.85.7779
Tshepong12.85.306811.5 5.786624.35.53134
Virginia         
  Harmony 20.93.56 3 0.13.281.03.533
  Merriespruit 11.24.5560.6 4.4521.84.528
  Merriespruit 30.93.6930.2 2.80 11.13.544
  Unisel3.04.95 15 1.84.8594.84.9124
  Brand 30.63.92 20.14.4210.74.023
  Total6.64.4329 2.84.56 139.44.4742
Doornkop         
  Doornkop Kimberley Reef0.32.48 10.32.5710.62.532
  Doornkop South Reef0.44.30 2 0.94.27 41.34.286
  Total0.73.5531.23.8551.93.758
Elandsrand11.56.5074 26.2 6.1116037.76.23234
Evander         
  Evander operations         
  Evander 2/50.86.3550.26.1711.06.326
  Evander 70.24.6410.0 8.480.24.811
  Evander 81.85.66 107.0 6.21438.86.0953
  Sub-total2.85.79 167.2 6.214410.06.0960
  Evander (below infrastructure)        
  Evander South11.54.80 5511.54.8055
  Rolspruit24.48.7121324.48.71213
  Poplar13.57.4510113.57.45101
  Sub-total49.47.4536949.47.45369
  Total2.85.791656.6 7.3041359.47.22429
Total SA Underground48.55.78280 132.26.83903180.76.551 183
SA Surface
Kalgold15.50.84139.01.071024.50.9323
Free State Surface         
  Phoenix130.80.2736130.80.2736
  St Helena289.6 0.2572289.60.2572
  Other421.80.2293101.70.26 26523.50.23119
  Total842.20.24 201101.70.2626943.90.24227
  Total SA Surface857.7 0.25214 110.70.3236968.40.26250
Total SA906.2  494 242.9 9391 149.1 1 433
Papua New Guinea 2
Hidden Valley and Kaveroi1.4 2.34317.61.99 3519.02.0238
  Hamata0.12.05 1.92.6952.02.665
  Golpu35.40.612235.40.6122
Total Papua New Guinea1.52.323 54.91.126256.41.1665
GRAND TOTAL907.7 497297.8 1 0011 205.5 1 498

Silver – Ore reserves statement (Metric)

 Proven Reserves  Probable ReservesTotal Reserves
 TonnesGradeSilver1TonnesGradeSilver1TonnesGradeSilver1
Operations(million)(g/t)(000kg)(million)(g/t)(000kg)(million)(g/t)(000kg)
Papua New Guinea 2         
  Hidden Valley and Kaveroi1.4  39.005517.636.7064619.036.87701

Copper – Ore reserves statement (Metric)

 Proven Reserves  Probable ReservesTotal Reserves
 TonnesGradeCu kg1TonnesGradeCu kg1TonnesGradeCu kg1
Operations(million)(%)(million)(million)(%)(million)(million)(%)(million)
Papua New Guinea 2         
  Golpu35.41.13 40035.41.13400

Molybdenum – Ore reserves statement (Metric)

 Proven Reserves  Probable ReservesTotal Reserves
 TonnesGradeMo kg1TonnesGradeMo kg1TonnesGradeMo kg1
Operations(million)(ppm)(million)(million)(ppm)(million)(million)(ppm)(million)
Papua New Guinea 2         
  Golpu35.4121.00435.4121.004

1 Metal figures are fully inclusive of all mining dilutions and gold losses, and are reported as mill delivered tonnes and head grades. Metallurgical recovery factors have not been applied to the reserve figures.

2 Represents Harmony's equity portion of 50%

Note: 1 tonne = 1 000 kg = 2 204 lbs

Gold – Ore reserves statement (Imperial)

 Proven ReservesProbable ReservesTotal Reserves
SA UndergroundTons
(million)
Grade
(oz/t)
Gold1
(000oz)
Tons
(million)
Grade
(oz/t)
Gold1
(000oz)
Tons
(million)
Grade
(oz/t)
Gold1
(000oz)
Bambanani3.90.2479651.30.3184205.20.2651 385
Joel1.00.1681612.50.1614043.50.163565
Masimong4.90.1527511.50.1542336.40.152984
Phakisa         
  Phakisa0.30.1584322.10.2375 23422.40.2365 277
  Nyala0.10.114130.10.10150.20.11018
  Total0.40.1455622.20.2365 23922.60.2355 295
Target5.30.1789429.9 0.1631 61715.20.1682 559
Tshepong14.1 0.1542 18412.60.1692 13026.70.1614 314
Virginia         
  Harmony 2  1.00.1041030.10.0919 1.10.103112
  Merriespruit 11.4 0.1331830.70.130862.10.132269
  Merriespruit 31.00.1071020.20.080 16 1.2 0.103 118
  Unisel3.3 0.1444821.90.1422765.20.143758
  Brand 30.6 0.114700.20.131200.80.11790
  Total7.30.1299403.10.13340710.40.1301 347
Doornkop         
  Doornkop Kimberley Reef0.30.072200.30.076250.60.074 45
  Doornkop South Reef0.40.126501.00.1251281.40.125178
  Total0.70.104701.30.1131532.00.110223
Elandsrand12.60.1902 395 28.90.1785 14641.50.1827 541
Evander         
  Evander operations         
  Evander 2/50.9 0.1851630.20.179381.10.184201
  Evander 70.2 0.133270.00.20320.20.13729
  Evander 82.0 0.1653327.70.1811 3949.70.1781 726
  Sub-total3.1 0.1695227.9 0.1811 43411.00.1771 956
  Evander (below infrastructure)        
  Evander South12.70.1401 77312.70.140 1 773
  Rolspruit26.9 0.2546 84226.90.2546 842
  Poplar14.90.2173 23414.90.2173 234
  Sub-total54.5 0.21711 84954.50.21711 849
  Total3.10.169522 62.40.21313 28365.50.21113 805
Total SA Underground53.3  0.1698 986145.70.19929 032199.00.19138 018
SA Surface
Kalgold17.30.0254259.80.03130727.10.027732
Free State Surface         
  Phoenix144.10.0081 148144.10.008 1 148
  St Helena319.20.0072 326319.20.0072 326
  Other465.00.0062 985112.20.008845577.20.0073 830
  Total928.30.0076 459112.20.0088451 040.50.0077 304
Total SA Surface945.60.0076 884122.00.0091 1521 067.60.0088 036
Total SA998.9 15 870267.7 30 184 1 266.6 46 054
Papua New Guinea 2
  Hidden Valley and Kaveroi1.50.06810519.40.0581 12620.90.0591 231
  Hamata0.20.064 72.10.0781642.30.078171
  Golpu39.00.01869439.0 0.018694
Total Papua New Guinea1.70.06811260.50.0331 98462.20.0342 096
GRAND TOTAL1 000.6 15 982328.2 32 1681 328.8 48 150

Silver – Ore reserves statement (Imperial)

 Proven Reserves  Probable ReservesTotal Reserves
 TonsGradeSilver oz1TonsGradeSilver oz1TonsGradeSilver oz1
Operations(million)(oz/t)(million)(million)(oz/t)(million)(million)(oz/t)(million)
Papua New Guinea 2         
  Hidden Valley and Kaveroi1.51.1371 75519.41.07020 76720.91.07522 522

Copper – Ore reserves statement (Imperial)

 Proven Reserves  Probable ReservesTotal Reserves
 TonsGradeCu lbs1TonsGradeCu lbs1TonsGradeCu lbs1
Operations(million)(%)(million)(million)(%)(million)(million)(%)(million)
Papua New Guinea 2         
  Golpu39.0 1.02588239.01.025882

Molybdenum – Ore reserves statement (Imperial)

 Proven Reserves  Probable ReservesTotal Reserves
 TonsGradeMo lbs1TonsGradeMo lbs1TonsGradeMo lbs1
Operations(million)(ppm)(million)(million)(ppm)(million)(million)(ppm)(million)
Papua New Guinea 2         
  Golpu39.0 0.231939.00.2319

1 Metal figures are fully inclusive of all mining dilutions and gold losses, and are reported as mill delivered tonnes and head grades. Metallurgical recovery factors have not been applied to the reserve figures.

2 Represents Harmony's equity portion of 50%

Note: 1 ton = 907 kg = 2 000 lbs

Appendix

Reporting Code

Harmony uses the South African Code for the Reporting of Exploration Results, mineral resources and ore reserves (SAMREC Code), which sets out the internationally recognised procedures and standards for reporting of mineral resources and ore reserves in South Africa. This code was developed by the South African Institute of Mining and Metallurgy and is the recommended guideline for reserve and resource reporting for companies listed on the JSE Limited. Harmony’s reporting of its Australian and PNG mineral resources and ore reserves also complies with the Australian Code for the Reporting of mineral resources and ore reserves (JORC code) of the Australian Institute of Mining and Metallurgy. This code is materially the same as the SAMREC code. In reporting reserves, distinct cognisance has also been taken of Industry Guide 7 of the United States Securities Exchange Commission. Harmony uses the term ‘ore reserves,’ which has the same meaning as ‘mineral reserves’, as defined in the SAMREC code.

Definitions as per the SAMREC code

Mineral resources

A mineral resource is a concentration (or occurrence) of material of economic interest in or on the earth’s crust in such form, quality and quantity that there are reasonable and realistic prospects for eventual economic extraction. The location, quantity, grade, continuity and other geological characteristics of a mineral resource are known, estimated from specific geological evidence and knowledge, or are interpreted from a well constrained and portrayed geological model.

Mineral resources are sub-divided in order of increasing confidence in respect of geoscientific evidence into inferred, indicated and measured categories. An inferred mineral resource is that part of a mineral resource for which tonnage, grade and mineral content can be estimated with a low level of confidence. It is inferred from geological evidence and sampling, and assumed but not verified geologically and/or through analysis of grade continuity. It is based on information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes that may be limited or of uncertain quality and reliability.

An indicated mineral resource is that part of a mineral resource for which tonnage, densities, shape, physical characteristics, grade and mineral content can be estimated with a reasonable level of confidence. It is based on exploration, sampling and the testing of information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes. The locations are too widely or inappropriately spaced to confirm geological and/or grade continuity but are spaced closely enough for continuity to be assumed.

A measured mineral resource is that part of a mineral resource for which tonnage, densities, shape, physical characteristics, grade and mineral content can be estimated with a high level of confidence. It is based on detailed and reliable exploration, sampling and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes. The locations are spaced closely enough to confirm geological and grade continuity.

Ore reserves

An ore reserve is the economically mineable material derived from a measured and/or indicated mineral resource. It includes diluting and contaminating materials and allows for losses that are expected to occur when the material is mined. Appropriate assessments to a minimum of a pre-feasibility study for a project, or a life of mine plan for an operation, must have been carried out, including consideration of, and modification by, realistically assumed mining, metallurgical, economic, marketing, legal, environmental, social and governmental factors (the modifying factors). Such modifying factors must be disclosed.

A probable ore reserve is the economically mineable material derived from a measured and/or indicated mineral resource. It is estimated with a lower level of confidence than a proved ore reserve. It includes diluting and contaminating materials and allows for losses that are expected to occur when the material is mined. Appropriate assessments to a minimum of a pre-feasibility study for a project, or a life of mine plan for an operation, must have been carried out, including consideration of, and modification by, realistically assumed mining, metallurgical, economic, marketing, legal, environmental, social and governmental factors. Such modifying factors must be disclosed.

A proven ore reserve is the economically mineable material derived from a measured mineral resource. It is estimated with a high level of confidence. It includes diluting and contaminating materials and allows for losses that are expected to occur when the material is mined. Appropriate assessments to a minimum of a pre-feasibility study for a project, or a life of mine plan for an operation, must have been carried out, including consideration of, and modification by, realistically assumed mining, metallurgical, economic, marketing, legal, environmental, social and governmental factors. Such modifying factors must be disclosed.

Harmony reporting in compliance with SAMREC

In order to meet the requirements of the SAMREC code that the material reported as a mineral resource should have "reasonable and realistic prospects for eventual economic extraction", Harmony has determined an appropriate cut-off grade which has been applied to the quantified mineralised body according to a process incorporating a long-term view on future economic modifying factors. In applying this process, Harmony uses a gold price of R350 000/kg at a derived cut-off grade to determine the mineral resources at each of its South African underground operations. Mineral resources have been estimated on the basis of geoscientific knowledge with input from the company’s ore reserve managers, geologists and geostatistical staff. Each mine’s mineral resources are categorised blocked-out and ascribed an estimated value. At most mines computerised geostatistical estimation processes are used.

In order to define that portion of a measured and indicated mineral resource that can be converted to a proven and probable ore reserve, Harmony applies the concept of a cut-off grade. At our underground South African mines, this is done by defining the optimal cut-off as the lowest grade at which an orebody can be mined such that the total profits, under a specified set of mining parameters, are maximised. The cut-off grade is determined using the company’s Optimiser computer programme which requires the following as input: the database of measured and indicated resource blocks (per shaft section); an assumed gold price which, for this ore reserve statement, was taken as R225 000/kg; planned production rates; the mine recovery factor (MRF) which is equivalent to the mine call factor (MCF) multiplied by the plant recovery factor (PRF); and planned cash operating costs (rand per tonne). Rand per tonne cash operating costs are historically based but take cognisance of distinct changes in the cost environment such as restructuring, right-sizing, and other cost reduction initiatives, and for below infrastructure ounces, an estimate of capital expenditure.

The block cave reserve at Golpu in PNG uses the PCBC computer programme to define the optimal mine plan and sequencing. The open-pit reserve at Hidden Valley in PNG is constrained by the capacity of the tailings storage facility with the Whittle optimisation programme guiding the most efficient mine design given this constraint.

The ore reserves represent that portion of the measured and indicated resources above cutoff in the life-of-mine plan and have been estimated after consideration of the factors affecting extraction, including mining, metallurgical, economic, marketing, legal, environmental, social, and governmental factors.

A range of disciplines which includes geology, survey, planning, mining engineering, rock engineering, metallurgy, financial management, human resources management and environmental management have been involved at each mine in the life-of-mine planning process and the conversion of resources into reserves.

The modifying factors related to the oreflow used to convert the mineral resources to ore reserves through the life-of-mine planning process are stated for each individual shaft. For these factors, historical information is used, except if there is a valid reason to do otherwise. As a result of the epth at which mining occurs and the resulting rock engineering requirements at our South African underground mines, some shafts design stope support pillars into their mining layouts which accounts for discounts of 7% to 10%. A further 15% discount is applied as a life-of-mine factor to provide for unpay and off-reef mining. In general, life-of-mine plan extraction factors do not exceed 85% and are reflected in the ore reserves.

Glossary of geological terms

Below infrastructure:
That part of a company’s ore reserve that can only be accessed following certain capital expenditure which has yet to be approved.
Craton:
A part of the earth’s crust that has attained stability and has been little deformed for a long period of geological time.
Diorite:
A group of plutonic rocks intermediate in composition between acidic and basic.
Felsic:
An igneous rock having abundant light coloured minerals.
Graben:
A block of rock that lies between two faults, and has moved downward to form a depression between two adjacent fault blocks.
Greenstone:
A field term for any compact dark green altered or metamorphosed basic igneous rock that owes its colour to chlorite.
Horst:
A block of rock that lies between two faults and has moved upward relative to the two adjacent fault blocks.
Kaapvaal Craton:
The ancient protocontinental basement of South Africa.
Lacustrine:
Pertaining to sediments formed in lakes.
Mafic:
An igneous rock composed chiefly of dark, ferromagnesium minerals.
Ophiolite:
A group of mafic and ultramafic igneous rocks derived by metamorphism, whose origin is associated with an early phase of the development of a geosyncline.
Plunge:
The inclination of a fold axis or other linear feature, measured in the vertical plane.
Sub-outcrop:
A rock stratum that unconformably underlies another rock stratum.
Syncline:
Concave fold in stratified rock, in which strata dip down to meet in a trough.
Witwatersrand Basin:
A sedimentary basin in South Africa.
Harmony Annual Report 2009