Name and Location
Kusasalethu gold project (formerly Elandsrand), Gauteng, South Africa.

Client
Harmony Gold Mining Company.

Harmony acquired Kusasalethu in February 2001 and continued with the shaft-deepening project that was under way at the time, to exploit the western high-grade block by accessing four additional production levels, 102, 105, 109 and 113, while mining the Ventersdorp Contact Reef (VCR).

Project Description
The operation comprises twin vertical and twin subvertical shaft systems.

The subvertical shafts, which access the deeper parts of the VCR, have been extended to a depth of 3 600 m, through the Kusasalethu shaft-deepening project. Mining is conducted by using conventional mining methods in a sequential grid layout.

Currently, work on the project is focussed on accessing and opening up areas of the new mine, as well as the development and construction of the necessary support infrastructure.

As at June 30, 2011, total proven and probable reserves were 33.8-million tons, with a grade of 6.61 g/t gold.

Value
A value for the project has not been confirmed.

Duration
Peak gold production is expected to take place between 2013 and 2021.

Latest Developments
Harmony Gold CEO Graham Briggs is confident that the company’s embattled Kusasalethu mine, near Carletonville, will operate at full production by the end of the June quarter.

He points out, however, that starting up the mine will be difficult, as safety measures will have to be put in place and it will be time consuming to get the 6 000 workers, which include contractors, back to work, with many having to undergo medical examinations.

Kusasalethu has been plagued by violent unprotected labour disruptions that started in late 2012. The company announced in early January that it would possibly place the mine on care and maintenance.

A dual process was started at Kusasalethu on January 7, which includes the issuing of a Section 189 notice to workers to respond to the company’s announcement that it could possibly place the mine on care and maintenance, which could result in the loss of about 6 000 jobs.

The company has also held bilateral discussions with various parties, including unions. Two meetings have been held to date.

Briggs says that Harmony has made some good progress at the Commission for Conciliation, Mediation and Arbitration, which is facilitating the process to avoid retrenchments.

He adds that Harmony is awaiting comment on a draft agreement that was compiled and issued on February 1, following the general agreement of all parties involved at the January 7 meeting.

The miner has also received a positive response to the draft agreement from the Department of Mineral Resources.

Meanwhile, Harmony reports that disruptions at Kusasalethu have resulted in the company’s overall gold production falling by 9% to 291 734 oz during the December quarter. This, in turn, has resulted in the rand per kilogram unit cost for the reporting period increasing by 6% from R294 404/kg in the September 2012 quarter to R310 858/kg.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
Harmony Gold Mining Company investor relations officer Henrika Basterfield, tel +27 11 411 2314, fax +27 11 692 3879 or email henrika@harmony.co.za.