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Harmony Gold Mining expects FY HEPS to be between 2,190 and 2,500 SA cents. The company produced 1.5 million ounces of gold in 2022/23 and operates 12 mines in South Africa and New Guinea, with South Africa accounting for 90.6% of net sales.

South Africa's gold mining industry is set to witness a significant milestone with the development of the Qala Shallows project, the country's first new underground gold mine in 15 years. Located on the western edge of Johannesburg, this project by West Wits Mining Ltd. represents a promising development in a sector that has seen a dramatic decline over recent decades. The project aims to tap into the rich gold deposits of the historic Witwatersrand Basin, with production scheduled to begin in 2026 and backed by a $90 million investment [1].

The Qala Shallows project boasts impressive specifications that have attracted significant investment interest. Key project details include an annual production target of 70,000 ounces, a maximum mine depth of 850 meters, a project lifespan of 17 years, and total projected revenue of $2.7 billion over the mine life. Production costs are estimated to be below $1,300 per ounce, which compares favorably to the current gold price of approximately $3,340 (as of August 2025) [1].

One of the most significant advantages of the Qala Shallows project is its relatively modest depth compared to traditional South African gold mines. While some South African mines extract gold from depths exceeding 3 kilometers, the Qala Shallows project's maximum depth of 850 meters significantly reduces technical challenges, safety concerns, and operational costs [1].

The project's economic fundamentals appear particularly strong in the current market environment. Cost efficiency, with production costs under $1,300 per ounce, and the ability to utilize existing processing facilities owned by Sibanye eliminate the need for costly new infrastructure. The financing structure further supports the project's viability, with $50 million in loans secured from the Industrial Development Corporation and Absa Group Ltd., demonstrating confidence from both state-owned and commercial financial institutions [1].

The opening of Qala Shallows must be viewed against the backdrop of South Africa's rich but declining gold mining history. Formerly the world's largest gold producer, South Africa's gold output has declined by more than 70% over the past 20 years. The gold industry now employs under 90,000 people, down from over 450,000 in the 1980s [1].

The Qala Shallows project offers meaningful employment opportunities in a sector that has shed hundreds of thousands of jobs. Direct employment, though specific numbers haven't been disclosed, typically creates several hundred jobs. The multiplier effect of these jobs could positively impact thousands of South Africans, particularly in communities where mining has traditionally been the economic backbone [1].

Beyond its immediate economic impact, the Qala Shallows project sends important signals to the broader investment community. It demonstrates that new gold projects in South Africa can still be viable despite industry challenges, potentially encouraging further exploration and development in previously marginal areas. According to mining historian Duncan Money, "The demise of South Africa's gold industry is usually told as a kind of morality tale about bad domestic politics, but the crucial development was the worldwide expansion stimulated by soaring gold prices in the 1970s and 1980s" [1].

The Qala Shallows project employs several innovative approaches to development, including phased production, utilizing existing processing facilities, and focusing on relatively shallow deposits to minimize technical challenges and operational costs. These innovative strategies make the project unique and potentially more economically viable [1].

In summary, the Qala Shallows project represents a significant development for South Africa's gold mining industry. Its strong economic fundamentals, innovative approaches to development, and potential employment opportunities make it a promising project in the current gold market environment.

References:
[1] https://discoveryalert.com.au/news/south-africa-2025-underground-gold-mine-opening/