To be able to listen in to Harmony Gold’s board deliberations on the undeveloped Wafi-Golpu would possibly be one of the most interesting discussions in the South African mining industry in coming months. The price tag for Harmony as it stands now is well in excess of its market capitalisation. For Harmony to follow its 50% stake in the project to develop a copper and gold mine in Papua New Guinea would cost the company R20bn against its market cap of R12bn. If the Papua New Guinea government follows its rights and buys a 30% stake in the project — which is shared equally between Harmony and Australia’s Newcrest Mining — and follows through with its portion of funding the mine then the price tag would come down to R14bn. Either way, analysts are deeply sceptical about Harmony’s involvement in the project. There are options open to Harmony around Wafi-Golpu, which is clearly not reflecting in Harmony’s share price. Harmony can either sell its stake or bring in a partner. The rumour d...

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