HARMONY chief executive Peter Steenkamp earned R15.92 million. African News Agency (ANA)
JOHANNESBURG - Harmony Gold, one of  South Africa’s biggest gold producers, said on Friday that the total pay package of its chief executive, Peter Steenkamp, had jumped 6 percent in the year to June compared with the previous year.

The group, which operates mines in South Africa - including Kusasalethu - and Hidden Valley in Papua New Guinea, said last week in its annual report for the year to the end of June that the group's gold output had increased 17percent to 1.44million ounces. It said underground grade recovery had improved for the seventh consecutive year by 2percent in 2019 to 5.59 grams per ton.

The group said Steenkamp had received total remuneration of R15.92million, including R8m in salary and benefits and R5.15m in retirement savings and contributions. His total remuneration last year was R14.9m.

Harmony’s financial director, Frank Abbott, earned a total of R10.6m in 2019, up from R10.3m in 2018.

In terms of salaries, the group said it had paid R12.5billion in wages and salaries to its 37000 employees, up from R9.5bn in 2018. In South Africa, it said it had paid R11.5bn in wages and salaries from R9.4bn in 2018. It paid R1.1bn in salaries and wages in Papua New Guinea in the year under review from R132m in 2018.

Harmony said that, given the myriad challenges presented by increasing mining depth, rising costs and a volatile rand/gold price, South African gold mines were under pressure to deliver a reasonable margin after all-in sustaining costs had been considered.

“Despite this industry context, we remain committed to paying a 'living wage' to our employees,” it said.

It said the South African gold industry was maturing and shrinking, with annual gold production declining to 117tons in 2018, from 137tons in 2017, while gold sales had fallen by 15percent to R69.7bn in 2018 from R82.9bn in 2017.

Meanwhile, the group reiterated that the licence for the Waif-Golpu project was delayed by the change of guard in the Papua New Guinea parliament.

Harmony and Australia's Newcrest Mining each own 50percent of Wafi-Golpu, which has been delayed over the issue of how much gold Papua New Guinea gets to keep.

The election of a new prime minister in that country led to the project missing its initial time lines.

“The licensing delay compelled the Wafi-Golpu joint venture to defer and revise the planned work programme, which had previously been scheduled to begin this calendar year,” the company said.

The group said the Papua New Guinea government continued to signal its support for the project.

It said the Wafi-Golpu joint venture was well placed to resume discussions with the government, given the constructive progress already made on the various agreements required to complete the licensing process and the grant of a special mining lease.

It said that the state of Papua New Guinea retained the right to purchase up to 30 percent equity interest in any mineral discovery at Wafi-Golpu, at any time before the start of mining.  

Harmony shares rose 2.54percent to close at R50 on the JSE on Friday.