--- page 1 ---
Sole Sponsor, Sponsor-Overall Coordinator, Joint Global Coordinator, Joint Bookrunner and Joint Lead Manager
Joint Global Coordinator, Joint Bookrunner and Joint Lead Manager
Overall Coordinator, Joint Global Coordinator, Joint Bookrunner and Joint Lead Manager
Stock Code : 6693
GLOBAL
OFFERING
Volume 1
Joint Bookrunners and Joint Lead Managers
(A joint stock company incorporated in the People’s Republic of China with limited liability)
赤峰吉隆黃金礦業股份有限公司
Chifeng Jilong Gold Mining Co., Ltd.


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This Prospectus is printed in three parts that together form the Prospectus. You
should read each part of the Prospectus in conjunction with the other parts
in order to understand the matters to which the Prospectus relates, including,
without limitation, the Hong Kong Public Offering and the International Offering.
Prospective investors should read each part of the Prospectus before making any
application in response to the Hong Kong Public Offering. We have adopted a
fully electronic application process for the Hong Kong Public Offering. We will
not provide printed copies of this Prospectus in relation to the Hong Kong Public
Offering. This  Prospectus  is  available  at  the  website  of  the  Stock  Exchange
at www.hkexnews.hk under the“HKEXnews > New Listings > New Listing
Information”section, and our website at cfgold.com. You may download and print
from these website addresses if you want a printed copy of this Prospectus.


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IMPORTANT: If you are in any doubt about any of the contents of this Prospectus, you should seek independent professional advice.
Chifeng Jilong Gold Mining Co., Ltd.
ʮ̡
(A joint stock company incorporated in the People’ s Republic of China with limited liability)
GLOBAL OFFERING
Number of Offer Shares under the Global
Offering
: 205,652,000 H Shares (subject to the Offer Size
Adjustment Option and the Over-allotment
Option)
Number of Hong Kong Offer Shares : 20,565,200 H Shares (subject to reallocation and
the Offer Size Adjustment Option)
Number of International Offer Shares : 185,086,800 H Shares (subject to reallocation, the
Offer Size Adjustment Option and the Over-
allotment Option)
Maximum Offer Price : HK$15.83 per H Share plus brokerage of 1.0%,
SFC transaction levy of 0.0027%, Hong Kong
Stock Exchange trading fee of 0.00565% and
AFRC transaction levy of 0.00015% (payable in
full on application in Hong Kong dollars and
subject to refund)
Nominal value : RMB1.00 per H Share
Stock Code : 6693
Sole Sponsor, Sponsor-Overall Coordinator, Joint Global Coordinator, Joint Bookrunner and Joint Lead Manager
Overall Coordinator, Joint Global Coordinator, Joint Bookrunner and Joint Lead Manager
Joint Global Coordinator, Joint Bookrunner and Joint Lead Manager
Joint Bookrunners and Joint Lead Managers
First Shanghai
Joint Lead Managers
Futu Securities Livermore Holdings Victory Securities Tiger Brokers Star RiverSWHY(HK)
Hong Kong Exchanges and Clearing Limited, The Stock Exchange of Hong Kong Limited and Hong Kong Securities Clearing Company Limited take no responsib ility for the contents of this
Prospectus, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arisin g from or in reliance upon the whole or any part
of the contents of this Prospectus.
A copy of this Prospectus, having attached thereto the documents specified in “Documents Delivered to the Registrar of Companies and Available on Dis play” in Appendix VII to this Prospectus,
has been registered by the Registrar of Companies in Hong Kong as required by Section 342C of the Companies (Winding Up and Miscellaneous Provisions) O rdinance (Chapter 32 of the Laws
of Hong Kong). The Securities and Futures Commission and the Registrar of Companies in Hong Kong take no responsibility as to the contents of this Prosp ectus or any other documents referred
to above.
The Offer Price is expected to be determined by agreement between the Overall Coordinators (for itself and on behalf of the Underwriters) and our Compa ny on the Price Determination Date, which
is expected to be on or before Thursday, March 6, 2025 and, in any event, not later than 12:00 noon on Thursday, March 6, 2025. The Offer Price will not be mo re than HK$15.83 per H Share and
is expected to be not less than HK$13.72 per H Share, unless otherwise announced.
The Overall Coordinators (for itself and on behalf of the Underwriters), may, with our Company’s consent, reduce the number of Offer Shares being offe red under the Global Offering and/or the
indicative Offer Price range below as stated in this Prospectus at any time on or prior to the morning of the last day for lodging applications under the H ong Kong Public Offering. In such a case,
an announcement will be published on the websites of the Hong Kong Stock Exchange at www.hkexnews.hk and our Company at cfgold.com not later than the morning of the day which is the last
day for lodging applications under the Hong Kong Public Offering. Details of the arrangement will then be announced by us as soon as practicable. For mo re details, see the sections headed “Structure
of the Global Offering” and “How to Apply for Hong Kong Offer Shares” in this Prospectus.
We are incorporated, and substantially all of our businesses are located, in the PRC. Potential investors should be aware of the differences in the leg al, economic and financial systems between the
mainland of the PRC and Hong Kong and that there are different risk factors relating to investment in PRC-incorporated business. Potential investors should also be aware that the regulatory
framework in the PRC is different from the regulatory framework in Hong Kong and should take into consideration the different market nature of the H Sha res. Such differences and risk factors
are set out in the sections headed “Risk Factors”, “Summary of Principal Legal and Regulatory Provisions” in Appendix V and “Summary of Articles of Ass ociation” in Appendix VI to this Prospectus.
The obligations of the Hong Kong Underwriters under the Hong Kong Underwriting Agreement are subject to termination by the Overall Coordinators (for itself and on behalf of the Hong Kong
Underwriters) if certain grounds arise prior to 8:00 a.m. on the Listing Date. Such grounds are set out in the section headed “Underwriting — Underwrit ing Arrangements and Expenses — Hong
Kong Public Offering — Grounds for Termination” in this Prospectus.
The Offer Shares have not been and will not be registered under the U.S. Securities Act or any state securities laws of the United States and may not be off ered or sold in the United States, or to
or for the account or benefit of any U.S. person (as defined in Regulation S), except pursuant to an exemption from, or in a transaction that is not subjec t to, the registration requirements of the
U.S. Securities Act and any applicable state or local securities laws. The Offer Shares may only be offered, sold or delivered outside the United State s to non-U.S. persons in offshore transactions
in accordance with Regulation S under the U.S. Securities Act.
ATTENTION
We have adopted a fully electronic application process for the Hong Kong Public Offering pursuant to Rule 12.11 of the Hong Kong Listing Rules. We will n ot provide printed copies of this
Prospectus to the public in relation to the Hong Kong Public Offering.
This Prospectus is available at the website of the Hong Kong Stock Exchange at www.hkexnews.hk and our website at cfgold.com . If you require a printed copy of this Prospectus, you may
download and print from the website addresses above.
IMPORTANT
February 28, 2025


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IMPORTANT NOTICE TO INVESTORS:
FULLY ELECTRONIC APPLICATION PROCESS
We have adopted a fully electronic application process for the Hong Kong
Public Offering. We will not provide printed copies of this Prospectus in relation to
the Hong Kong Public Offering.
This Prospectus is available at the website of the Stock Exchange at
www.hkexnews.hk under the “ HKEXnews > New Listings > New Listing Information ”
section, and our website at cfgold.com . Y ou may download and print from these website
addresses if you want a printed copy of this Prospectus.
To apply for the Hong Kong Offer Shares, you may:
(1) apply online via the White Form eIPO service at www.eipo.com.hk ;o r
(2) apply electronically through the HKSCC EIPO channel and cause HKSCC
Nominees to apply on your behalf by instructing your broker or custodian who
is a HKSCC Participant to give electronic application instructions via
HKSCC’s FINI system to apply for the Hong Kong Offer Shares on your
behalf.
We will not provide any physical channels to accept any application for the Hong
Kong Offer Shares by the public. The contents of the electronic version of this
Prospectus are identical to the printed prospectus as registered with the Registrar of
Companies in Hong Kong pursuant to Section 342C of the Companies (Winding Up and
Miscellaneous Provisions) Ordinance.
If you are an intermediary, broker or agent, please remind your customers, clients
or principals, as applicable, that this Prospectus is available online at the website
addresses stated above.
Please refer to the section headed “How to Apply for Hong Kong Offer Shares” in
this Prospectus for further details on the procedures through which you can apply for the
Hong Kong Offer Shares electronically.
IMPORTANT
–i i–


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Y our application through the White Form eIPO service or the HKSCC EIPO
channel must be made for a minimum of 200 Hong Kong Offer Shares and in multiples
of that number of Hong Kong Offer Shares as set out in the table below. No application
for any other number of Hong Kong Offer Shares will be considered and such an
application is liable to be rejected.
If you are applying through the White Form eIPO service, you may refer to the
table below for the amount payable for the number of Shares you have selected. Y ou
must pay the respective amount payable on application in full upon application for Hong
Kong Offer Shares.
If you are applying through the HKSCC EIPO channel, you are required to
pre-fund your application based on the amount specified by your broker or custodian, as
determined based on the applicable laws and regulations in Hong Kong.
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application
HK$ HK$ HK$ HK$
200 3,197.93 4,000 63,958.58 60,000 959,378.72 2,000,000 31,979,291.10
400 6,395.86 5,000 79,948.23 70,000 1,119,275.19 2,500,000 39,974,113.88
600 9,593.79 6,000 95,937.87 80,000 1,279,171.64 3,000,000 47,968,936.66
800 12,791.72 7,000 111,927.52 90,000 1,439,068.11 3,500,000 55,963,759.43
1,000 15,989.64 8,000 127,917.17 100,000 1,598,964.55 4,000,000 63,958,582.20
1,200 19,187.57 9,000 143,906.81 200,000 3,197,929.11 4,500,000 71,953,404.98
1,400 22,385.50 10,000 159,896.45 300,000 4,796,893.66 5,000,000 79,948,227.76
1,600 25,583.43 20,000 319,792.91 400,000 6,395,858.22 6,000,000 95,937,873.30
1,800 28,781.36 30,000 479,689.36 500,000 7,994,822.78 7,000,000 111,927,518.86
2,000 31,979.29 40,000 639,585.83 1,000,000 15,989,645.56 8,000,000 127,917,164.40
3,000 47,968.93 50,000 799,482.28 1,500,000 23,984,468.33 10,282,600
(1) 164,415,129.34
(1) Maximum number of Hong Kong Offer Share you may apply for.
(2) The amount payable is inclusive of brokerage, SFC transaction levy, the Stock Exchange trading fee
and AFRC transaction levy. If your application is successful, brokerage will be paid to the Exchange
Participants (as defined in the Listing Rules) and the SFC transaction levy, the Stock Exchange trading
fee and AFRC transaction levy are paid to the Stock Exchange (in the case of the SFC transaction levy,
collected by the Stock Exchange on behalf of the SFC; and in the case of the AFRC transaction levy,
collected by the Stock Exchange on behalf of the AFRC).
IMPORTANT
– iii –


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If there is any change in the following expected timetable of the Hong Kong Public
Offering, we will issue an announcement in Hong Kong to be published on our website
at cfgold.com and the website of the Stock Exchange at www.hkexnews.hk .
Hong Kong Public Offering commences ........................ 9:00 a.m. on Friday,
February 28, 2025
Latest time to complete electronic applications under
White Form eIPO service through the designated
website at www.eipo.com.hk (2) .........................1 1:30 a.m. on Wednesday,
March 5, 2025
Application lists for the Hong Kong Public Offering open (3) ....1 1:45 a.m. on Wednesday,
March 5, 2025
Latest time to complete payment of White Form eIPO
applications by effecting internet banking
transfer(s) or PPS payment transfer(s) and giving
electronic application instructions to HKSCC
(4) .......... 12:00 noon on Wednesday,
March 5, 2025
If you are instructing your broker or custodian who is a HKSCC Participant to give
electronic application instructions via HKSCC’s FINI system to apply for the Hong Kong Offer
Shares on your behalf, you are advised to contact your broker or custodian for the latest time
for giving such instructions which may be different from the earliest and latest time as stated
above, as this may vary by broker or custodian .
Application lists for the Hong Kong Public Offering close
(3) . . . 12:00 noon on Wednesday,
March 5, 2025
Expected Price Determination Date (5) .................................. Thursday,
March 6, 2025
Announcement of the final Offer Price, the level of indications
of interest in the International Offering, the level of
applications in the Hong Kong Public Offering and the
basis of allocation of the Hong Kong Offer Shares under
the Hong Kong Public Offering to be published and on
the website of the Stock Exchange at www.hkexnews.hk
and our website at cfgold.com (6) at or before (7) ................1 1:00 p.m. on Friday,
March 7, 2025
EXPECTED TIMETABLE (1)
–i v–


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The results of allocations in the Hong Kong Public Offering (with successful applicants’
identification document numbers, where appropriate) to be available through a variety of
channels, including:
 in the announcement to be posted on our website
and the website of the Stock Exchange at
cfgold.com and www.hkexnews.hk , respectively ...........a to r before 11:00 p.m.
on Friday, March 7, 2025
 from the designated results of
allocations website at
www.iporesults.com.hk (alternatively:
www.eipo.com.hk/eIPOAllotment ) ....... from 11:00 p.m. on Friday, March 7, 2025
12:00 midnight on Thursday, March 13, 2025
 from the allocation results telephone enquiry by
calling 2862 8555 between 9:00 a.m. and 6:00 p.m. on ..... Monday, March 10, 2025
Tuesday, March 11, 2025
Wednesday, March 12, 2025 and
Thursday, March 13, 2025
H Share certificates in respect of wholly or partially
successful applications under the Hong Kong Public Offering
to be dispatched or deposited into CCASS on or before
(8) ....... Friday, March 7, 2025
White Form e-Refund payment instructions/refund cheques
in respect of wholly or partially unsuccessful applications
under the Hong Kong Public Offering to be
dispatched/collected on or before
(9) ...................... Monday, March 10, 2025
Dealings in the H Shares on the Stock Exchange expected
to commence at ........................................ 9:00 a.m. on Monday,
March 10, 2025.
The application for the Hong Kong Offer Shares will commence on Friday, February 28,
2025 through Wednesday, March 5, 2025. The application monies (including brokerage, AFRC
transaction levy, SFC transaction levy and Stock Exchange trading fee) will be held by the
receiving bank on behalf of us and the refund monies, if any, will be returned to the applicant(s)
without interest on Monday, March 10, 2025. Investors should be aware that the dealings in H
Shares on the Stock Exchange are expected to commence on Monday, March 10, 2025.
The above expected timetable is a summary only. For further details of the structure of
the Global Offering, including its conditions, and the procedures for applications for Hong
Kong Offer Shares, please see “Structure of the Global Offering” and “How to Apply for Hong
Kong Offer Shares”, respectively.
If the Global Offering does not become unconditional or is terminated in accordance with
its terms, the Global Offering will not proceed. In such case, we will make an announcement
as soon as practicable thereafter.
EXPECTED TIMETABLE (1)
–v–


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Notes:
(1) All times and dates refer to Hong Kong times and dates.
(2) Y ou will not be permitted to submit your application under the White Form eIPO service through the
designated website at www.eipo.com.hk after 11:30 a.m. on the last day for submitting applications. If you
have already submitted your application and obtained an application reference number from the designated
website prior to 11:30 a.m., you will be permitted to continue the application process (by completing payment
of application monies) until 12:00 noon on the last day for submitting applications, when the application lists
close.
(3) If there is/are a “black” rainstorm warning or a tropical cyclone warning signal number 8 or above and/or
Extreme Conditions in force in Hong Kong at any time between 9:00 a.m. and 12:00 noon on Wednesday,
March 5, 2025, the application lists will not open on that day. For further details, please see the section headed
“How to Apply for Hong Kong Offer Shares — E. Severe Weather Arrangements — 1. The Opening and
Closing of the Application Lists”.
(4) Applicants who apply for Hong Kong Offer Shares through HKSCC EIPO channel should refer to “How to
Apply for Hong Kong Offer Shares — A. Applications for Hong Kong Offer Shares — 2. Application
Channels”.
(5) The Price Determination Date is expected to be on or before Thursday, March 6, 2025. If, for any reason, the
Offer Price is not agreed between the Overall Coordinators (for itself and on behalf of the Underwriters) and
our Company on or before 12:00 noon on Thursday, March 6, 2025, the Global Offering will not proceed and
will lapse.
(6) H Share certificates will only become valid evidence of title at 8:00 a.m. on the Listing Date provided that the
Global Offering has become unconditional and the right of termination described in “Underwriting —
Underwriting Arrangements and Expenses — Hong Kong Public Offering — Grounds for Termination” has not
been exercised. Investors who trade H Shares on the basis of publicly available allocation details prior to the
receipt of Share certificates or prior to the H Share certificates becoming valid evidence of title do so entirely
at their own risk.
(7) None of the websites or any of the information contained on the websites forms part of this Prospectus.
(8) White Form e-Refund payment instructions/refund cheques will be issued in respect of wholly or partially
unsuccessful applications pursuant to the Hong Kong Public Offering. Part of the applicant’s Hong Kong
identity card number or passport number, or, if the application is made by joint applicants, part of the Hong
Kong identity card number or passport number of the first-named applicant, provided by the applicant(s) may
be printed on the refund cheque, if any. Such data would also be transferred to a third party for refund purposes.
Banks may require verification of an applicant’s Hong Kong identity card number or passport number before
encashment of the refund cheque. Inaccurate completion of an applicant’s Hong Kong identity card number or
passport number may invalidate or delay encashment of the refund cheque.
(9) Applicants being individuals who are eligible for personal collection may not authorize any other person to
collect on their behalf. If you are a corporate applicant which is eligible for personal collection, your
authorized representative must bear a letter of authorization from your corporation stamped with your
corporation’s chop. Both individuals and authorized representatives must produce evidence of identity
acceptable to our H Share Registrar at the time of collection.
Applicants who have applied for Hong Kong Offer Shares through the HKSCC EIPO channel should refer to
“How to Apply for Hong Kong Offer Shares — D. Despatch/Collection of H Share Certificates and Refund of
Application Monies” for details.
Applicants who have applied through the White Form eIPO service and paid their applications monies
through single bank accounts may have refund monies (if any) dispatched to the bank account in the form of
White Form e-Refund payment instructions. Applicants who have applied through the White Form eIPO
service and paid their application monies through multiple bank accounts may have refund monies (if any)
dispatched to the address as specified in their application instructions in the form of refund cheques by
ordinary post at their own risk.
H Share certificates and/or refund cheques for applicants who have applied for less than 1,000,000 Hong Kong
Offer Shares and any uncollected H Share certificates and/or refund cheques will be dispatched by ordinary
post, at the applicants’ risk, to the addresses specified in the relevant applications.
Further information is set out in “How to Apply for Hong Kong Offer Shares — D. Despatch/Collection of H
Share Certificates and Refund of Application Monies”.
EXPECTED TIMETABLE (1)
–v i–


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This Prospectus is issued by our Company solely in connection with the Hong Kong
Public Offering and the Hong Kong Offer Shares and does not constitute an offer to sell
or a solicitation of an offer to subscribe for or buy any security other than the Hong Kong
Offer Shares. This Prospectus may not be used for the purpose of, and does not constitute,
an offer to sell or a solicitation of an offer to subscribe for or buy any security or
invitation in any other jurisdiction or in any other circumstances. No action has been
taken to permit a public offering of the Offer Shares or the distribution of this Prospectus
in any jurisdiction other than Hong Kong. The distribution of this Prospectus and the
offering and sale of the Offer Shares in other jurisdictions are subject to restrictions and
may not be made except as permitted under the applicable securities laws of such
jurisdiction pursuant to registration with or authorization by the relevant securities
regulatory authorities or an exemption therefrom.
You should rely only on the information contained in this Prospectus to make your
investment decision. We have not authorized anyone to provide you with information that
is different from what is contained in this Prospectus. Any information or representation
not included in this Prospectus must not be relied on by you as having been authorized
by us, the Sole Sponsor , the Sponsor Overall Coordinators, the Overall Coordinators, the
Joint Global Coordinator , the Joint Bookrunner , the Joint Lead Manager , the
Underwriters, any of our or their respective directors, officers, employees, partners,
agents or representatives, or any other party involved in the Global Offering. Information
contained on our website cfgold.com does not form part of this Prospectus.
Page
Expected Timetable ................................................. i v
Contents ......................................................... v i i
Summary ......................................................... 1
Definitions ........................................................ 4 6
Glossary of Technical Terms ......................................... 6 5
Summary of the JORC Code .......................................... 7 4
Forward-Looking Statements ......................................... 7 6
Risk Factors ...................................................... 7 8
Waivers from Strict Compliance with the Hong Kong Listing Rules and
Exemption from Strict Compliance with the Companies (Winding Up And
Miscellaneous Provisions) Ordinance ................................. 1 3 8
Information about this Prospectus and the Global Offering ................ 1 5 2
CONTENTS
– vii –


--- page 10 ---
Directors, Supervisors and Parties Involved in the Global Offering .......... 1 5 7
Corporate Information .............................................. 1 6 5
Industry Overview ................................................. 1 6 8
Regulatory Overview ............................................... 1 9 1
History, Development and Corporate Structure .......................... 2 2 3
Business .......................................................... 2 5 1
Relationship with our Single Largest Shareholder Group .................. 4 3 2
Connected Transactions .............................................. 4 3 8
Directors, Supervisors and Senior Management .......................... 4 4 3
Share Capital ..................................................... 4 6 4
Substantial Shareholders ............................................ 4 6 8
Financial Information ............................................... 4 7 0
Cornerstone Investment .............................................. 5 8 2
Future Plans and Use of Proceeds ..................................... 5 9 1
Underwriting ...................................................... 5 9 4
Structure of the Global Offering ...................................... 6 0 8
How to Apply for Hong Kong Offer Shares ............................. 6 2 2
Appendix IA – Accountants’ Report ............................. IA-1
Appendix IB – Historical Financial Information of Golden Star
Resources .................................... IB-1
Appendix IIA – Unaudited Pro Forma Financial Information ......... IIA-1
Appendix IIB – Profit Estimate ................................. IIB-1
Appendix IIIA – Competent Person’s Report for the PRC Mines ........ IIIA-1
Appendix IIIB – Competent Person’s Report for the Sepon Gold
and Copper Mine .............................. IIIB-1
CONTENTS
– viii –


--- page 11 ---
Appendix IIIC – Competent Person’s Report for the
Wassa Gold Mine .............................. IIIC-1
Appendix IIID – Competent Person’s Report for the Sepon Rare
Earth Element and Mengkham Rare Earth Element
Projects in Lao People’s Democratic Republic ...... IIID-1
Appendix IV – Taxation and Foreign Exchange .................... I V - 1
Appendix V – Summary of Principal Legal and Regulatory Provisions .V - 1
Appendix VI – Summary of Articles of Association ................. VI-1
Appendix VII – Statutory and General Information ................. VII-1
Appendix VIII – Documents Delivered to the Registrar of Companies
and Available on Display ....................... VIII-1
CONTENTS
–i x–


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This summary aims at giving you an overview of the information contained in this
Prospectus and should be read in conjunction with the full text of this Prospectus. As
the following is only a summary, it does not contain all the information that may be
important to you. Y ou should read this Prospectus in its entirety before you decide to
invest in the Offer Shares.
There are risks associated with any investment. Some of the particular risks in
investing in the Offer Shares are set out in the section headed “Risk factors” in this
Prospectus. Y ou should read that section carefully before you decide to invest in the
Offer Shares. V arious expressions used in this summary are defined in the sections
headed “Definitions” and “Glossary of technical terms” in this Prospectus.
OVERVIEW
We are principally engaged in the mining, processing, and sales of gold. As of the Latest
Practicable Date, we owned and operated seven gold and polymetallic mines across the world,
including China, Southeast Asia, and West Africa. According to Frost & Sullivan:
 we experienced the fastest growth among major gold producers in China. From 2021
to 2023, our gold production achieved a CAGR of 33.1%, which was higher than the
16.4% average growth rate of major gold producers in China;
 we ranked fifth among gold producers in China in terms of gold Resources, with
gold Resources of 12.5 million oz as of September 30, 2024, and we ranked fifth
among gold producers in China in terms of gold production, with gold production
of 461.5 koz in 2023;
 our operational efficiency enhancement surpassed the worldwide industry average
and we positioned lower in terms of gold all-in sustaining costs (“ AISC ”) than that
of the global average. For the year ended December 31, 2023, our gold AISC stood
at only US$1,179.1 per ounce, placing us in the first quartile in the worldwide gold
mining industry, while the global average for the same period was approximately
US$1,348.5, which is 14.4% higher than ours. In 2023, we beat the global trend of
increased costs, as we reduced our gold AISC by 12.0%, whereas the average AISC
for international gold producers increased by 7.2% during the same period; and
 among gold producers in China, we had the greatest overseas presence in terms of
both total assets and revenue contribution derived from business activities outside of
the PRC as of December 31, 2023 and in 2023, respectively. In 2023, approximately
76.9% of our total gold production and 71.9% of our total revenue was generated
from our overseas business. As of September 30, 2024, approximately 65.2% of our
total assets were contributed by our overseas business.
SUMMARY
–1–


--- page 13 ---
We conducted our gold production business primarily through six gold mines, including:
(i) four mines in the PRC, namely the Jilong Gold Mine, Wulong Gold Mine, Jintai Gold Mine
and Huatai Gold Mine; (ii) one mine in Laos, namely the Sepon Gold and Copper Mine; and
(iii) one mine in Ghana, namely the Wassa Gold Mine. Furthermore, we operate one
polymetallic mine in Jilin Province, China, namely the Hanfeng Polymetallic Mine, the
principal products of which are zinc, lead, copper and molybdenum concentrate powder. Also,
we are planning to develop rare earth Resources in Laos. In addition to our mining business,
we have a resource recycling business, where we recycle waste electronic products and
electrical appliances.
As of the Latest Practicable Date, we held a total of 12 valid mining licenses in the PRC,
including (i) one mining license for Wulong Mining, (ii) two mining licenses for Jilong Mining,
(iii) six mining licenses for Huatai Mining, (iv) one mining license for Jintai Mining, and (v)
two mining licenses for Hanfeng Mining. In addition, as of the Latest Practicable Date, we held
5 valid exploration permits in the PRC, including (i) one exploration permit for Jilong Mining,
(ii) two exploration permits for Wulong Mining, (iii) one exploration permit for Jintai Mining,
and (iv) one exploration permit for Hanfeng Mining. Moreover, as of the Latest Practicable
Date, we held one valid mining license and one valid exploration permit in Laos. In addition,
as of the Latest Practicable Date, we held two valid mining licenses and three valid exploration
permits in Ghana for GSWL, with one mining license having been renewed by the Ministry of
Lands and Natural Resources and in the process of being ratified by Parliament. It is stipulated
in the subsection 44(4) of the Mining Act of Ghana that if a holder of a mining lease has made
an application for extension of the term, the lease shall continue in force in respect of the
subject of the application before the outcome of the application is determined. As advised by
our Ghana Legal Advisor, this means the lessee is able to continue its ongoing mining
operations under the old lease before the new lease is ratified by the Parliament. For details,
see “Business — Our Gold Production Business in Ghana — Mining Licenses and Exploration
Permits.”
We have high visibility and certainties in our production expansion plans for our gold
mines and aim to achieve Resources and Reserve enhancement through exploration activities
as set out below:
 in terms of our overseas gold assets, we are accelerating the construction of the
open-pit and underground mining projects of the Sepon Gold and Copper Mine,
which is expected to increase the annual underground mining capacity to 806,000
tonnes by 2025 from the current capacity of 536,000 tonnes. We plan to also
commence copper production in 2025 at Khanong area of Sepon Gold and Copper
Mine, which has over 6,000,000 tonnes of copper ore, and over 57,000 tonnes of
copper metal contained according to the resource model. Meanwhile, we are
accelerating modelling and study of exploration prospects of Discovery West Deeps
and Phavat North of the Sepon Gold and Copper Mine with open-pit and
underground mining potentials. The annual underground mining capacity is
SUMMARY
–2–


--- page 14 ---
expected to be further increased after 2026 and 2027. A high-level resource range
assessment of Discovery West Deeps and Phavat North prospects estimated a total
tonnage of 5,000,000 tonnes, with an average Au grade of 3.5g/t of gold resources
expected to be added.
 in terms of our domestic gold assets, we have been undergoing several rounds of
technological transformation and we are still working on several technological
improvement projects. We have also initiated an expansion project at Jilong Mining
to increase its annual mining capacity to approximately 300,000 tonnes by the end
of 2025.
Plan for Exploration and Development of Rare Earth Resources
Apart from our core gold business, our planned exploration and development of rare earth
resources in Laos also create new growth opportunities. Anomalies in rare earth elements were
discovered at the Sepon Gold and Copper Mine during exploration in early 2021. Following
further studies, according to SRK report, as of September 30, 2024, the Mineral Resources for
rare earth oxides are estimated to be about, 26.78 million tonnes of Indicated Mineral Resource
with an average grade of 383.75 g/t TREO, equivalent to 10.28 thousand tonnes of total rare
earth oxides within the Project area, and 63.79 million tonnes of Inferred Mineral Resource
with an average grade of 339.22 g/t TREO, equivalent to 21.64 thousand tonnes of total rare
earth oxides within the Project area. In October 2022, together with Xiamen Tungsten we
established a joint venture, Chijin Xiawu, where we hold a 51% equity interest. Chijin Xiawu
focuses on the development of rare earth Resources in Laos. The collaboration with Xiamen
Tungsten is expected to improve our competitiveness in the development of rare earth and
generate new growth opportunities for our business. Our subsidiaries’ applications for licenses
or permits for rare earth exploration or mining right in Laos submitted to the relevant
governmental authorities are currently put on hold by the relevant governmental authorities, as
the Laos government has suspended review of all rare earth pilot project applications. Please
refer to “Business — Our Rare Earth Business in Laos” for more details.
COMPETITIVE STRENGTHS
We believe that our leading market position is underpinned by the following competitive
strengths:
 the largest non-state owned gold producer with leading growth in gold production
and revenue in China, possessing robust market prospects;
 overseas experience and global recognition with proven track record in identifying
synergetic acquisition targets, executing transactions and integrating global
operations;
SUMMARY
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--- page 15 ---
 continuously improving on the cost curve to enhance efficiency through
technological upgrade and to drive profitability;
 distinctive “Mutual Prosperity and Development” corporate culture and effective
incentive programs continuously motivate the management and employees to boost
continuous growth;
 a strong social responsibility and solid commitment to promoting green and
sustainable development with high ESG standards; and
 seasoned and dedicated management team with deep expertise in the gold industry
and proven track record in mine operations locally and globally.
Please see “Business — Competitive Strengths” for further details of our competitive
strengths.
BUSINESS STRATEGIES
We intend to implement the following business strategies to achieve our goal:
 continue to increase Reserves through exploration activities and expand production
volume at existing mines to realize our full growth potential;
 continue to obtain Resources and Reserves and increase production volume through
domestic and overseas acquisitions of high-quality gold assets for robust and
sustainable growth;
 continue to improve productivity, reduce cost and enhance profitability;
 adhere to our culture of “Mutual Prosperity and Development” to ensure strong
motivation for the management team and employees; and
 continue to improve our ESG governance and enhance our standards of
environmental protection, safety, social responsibility and corporate governance.
Please see “Business — Business Strategies” for further details of our business strategies.
SUMMARY
–4–


--- page 16 ---
MINERAL RESOURCES AND RESERVES
Our Mineral Resources and Ore Reserves in China
The following table, which is based on the Competent Person’s Report prepared in
accordance with the JORC Code, sets forth the information of our gold Resources in the PRC
as of September 30, 2024:
Mineralized
Zone/Block Category Tonnage Au Grade
Au Metal
Contained
Au Metal
Contained
(kt) (g/t) (koz) (t)
Wulong Gold Mine /H1118/H1118Measured ––––
Indicated 1,261 8.17 332 10.30
Inferred 1,738 7.21 402 12.53
Total 2,999 7.61 734 22.83
Jilong Gold Mine /H1118/H1118/H1118Measured 484 12.19 190 5.90
Indicated 424 9.25 126 3.92
Inferred 508 9.24 151 4.70
Total 1,415 10.25 467 14.51
Huatai Gold Mine /H1118/H1118Measured 385 5.88 73 2.27
Indicated 2,146 7.27 502 15.60
Inferred 1,281 6.90 284 8.83
Total 3,812 7.01 859 26.71
Jintai Gold Mine /H1118/H1118/H1118Measured 3,363 1.68 181 5.64
Indicated 4,604 1.02 151 4.70
Inferred 2,699 1.29 112 3.49
Total 10,666 1.30 444 13.82
Total
consolidated /H1118/H1118/H1118/H1118/H1118Measured 4,232 3.26 444 13.80
Indicated 8,435 4.09 1,110 34.52
Inferred 6,226 4.75 949 29.55
Total 18,893 4.12 2,503 77.87
Note:
1. Numbers have been subject to rounding. Accordingly, figures shown as totals in the table may not be
an arithmetic aggregation of the figures preceding them.
SUMMARY
–5–


--- page 17 ---
As of September 30, 2024, the Mineral Resources for Wulong Gold Mine are estimated
to be about 2,999 thousand tonnes with an average Au grade of 7.61 g/t, including
approximately 1,261 thousand tonnes of Indicated Mineral Resources with an average Au grade
of 8.17 g/t, and 1,738 thousand tonnes of Inferred Mineral Resources with an average Au grade
of 7.21 g/t. The Mineral Resources for Jilong Gold Mine are estimated to be about 1,415
thousand tonnes with an average Au grade of 10.25 g/t, including approximately 484 thousand
tonnes of Measured Mineral Resources with an average Au grade of 12.19 g/t, 424 thousand
tonnes of Indicated Mineral Resources with an average Au grade of 9.25 g/t, 508 thousand
tonnes of Inferred Mineral Resources with an average Au grade of 9.24 g/t. The Mineral
Resources for Huatai Gold Mine are estimated to be about 3,812 thousand tonnes with an
average Au grade of 7.01 g/t, including approximately 385 thousand tonnes of Measured
Mineral Resources with an average Au grade of 5.88g/t, 2,146 thousand tonnes of Indicated
Mineral Resources with an average Au grade of 7.27 g/t, 1,281 thousand tonnes of Inferred
Mineral Resources with an average Au grade of 6.90 g/t. The Mineral Resources for Jintai Gold
Mine are estimated to be about 10,666 thousand tonnes with an average Au grade of 1.30 g/t,
including approximately 3,363 thousand tonnes of Measured Mineral Resources with an
average Au grade of 1.68 g/t, 4,604 thousand tonnes of Indicated Mineral Resources with an
average Au grade of 1.02 g/t, 2,699 thousand tonnes of Inferred Mineral Resources with an
average Au grade of 1.29 g/t.
As of September 30, 2024, the Mineral Resources for our PRC Mines are estimated to be
about 18,893 thousand tonnes with an average Au grade of 4.12 g/t, including approximately
4,232 thousand tonnes of Measured Mineral Resources with an average Au grade of 3.26 g/t,
8,435 thousand tonnes of Indicated Mineral Resources with an average Au grade of 4.09 g/t,
6,226 thousand tonnes of Inferred Mineral Resources with an average Au grade of 4.75 g/t.
The following table, which is based on the Competent Person’s Report prepared in
accordance with the JORC Code, sets forth the information of our gold Reserves in the PRC
as of September 30, 2024:
Mineralized
Zone/Block Category Tonnage Au Grade
Au Metal
Contained
Au Metal
Contained
(kt) (g/t) (koz) (t)
Wulong Gold Mine /H1118/H1118Proved ––––
Probable 984 7.30 231 7.19
Total 984 7.30 231 7.19
Jilong Gold Mine /H1118/H1118/H1118Proved 510 9.81 161 5.00
Probable 409 7.38 97 3.02
Total 919 8.73 258 8.02
Huatai Gold Mine /H1118/H1118Proved 226 5.21 38 1.18
Probable 1,468 6.35 300 9.32
Total 1,694 6.20 338 10.50
SUMMARY
–6–


--- page 18 ---
Mineralized
Zone/Block Category Tonnage Au Grade
Au Metal
Contained
Au Metal
Contained
(kt) (g/t) (koz) (t)
Jintai Gold Mine /H1118/H1118/H1118Proved ––––
Probable 1,370 0.75 33 1.03
Total 1,370 0.75 33 1.03
Total
consolidated /H1118/H1118/H1118/H1118/H1118Proved 736 8.40 199 6.18
Probable 4,231 4.86 661 20.55
Total 4,967 5.38 860 26.73
Note:
1. Numbers have been subject to rounding. Accordingly, figures shown as totals in the table may not be
an arithmetic aggregation of the figures preceding them.
As of September 30, 2024, the Probable Ore Reserves for Wulong Gold Mine are about
984 thousand tonnes with an average Au grade of 7.30 g/t. The Ore Reserves for Jinlong Gold
Mine are about 919 thousand tonnes with an average Au grade of 8.73 g/t, of which 510
thousand tonnes are Proved Ore Reserves with an average Au grade of 9.81 g/t, and 409
thousand tonnes are Probable Ore Reserves with an average Au grade of 7.38 g/t. The Ore
Reserves for Huatai Gold Mine are about 1,694 thousand tonnes with an average Au grade of
6.20 g/t, of which 226 thousand tonnes are Proved Ore Reserves with an average Au grade of
5.21 g/t, and 1,468 thousand tonnes are Probable Ore Reserves with an average Au grade of
6.35 g/t. The Probable Ore Reserves for Jintai Gold Mine are about 1,370 thousand tonnes with
an average Au grade of 0.75 g/t.
As of September 30, 2024, the Ore Reserves for PRC Mines are about 4,967 thousand
tonnes with an average Au grade of 5.38 g/t, of which 736 thousand tonnes are Proved Ore
Reserves with an average Au grade of 8.40 g/t, and 4,231 thousand tonnes are Probable Ore
Reserves with an average Au grade of 4.86 g/t.
Our Mineral Resources and Ore Reserves in Laos and Ghana
The following table, which is based on the Competent Person’s Report prepared in
accordance with the JORC Code, sets forth the information of our gold Resources in Laos and
Ghana as of September 30, 2024:
Mineralized Zone/Block Category Tonnage Au Grade
Au Metal
Contained
Au Metal
Contained
(kt) (g/t) (koz) (t)
Sepon Gold and
Copper Mine –
Gold /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Measured 276 7.98 71 2.21
Indicated 7,220 4.13 958 29.80
Inferred 6,002 3.67 707 22.00
Total 13,498 4.00 1,736 54.01
SUMMARY
–7–


--- page 19 ---
Mineralized Zone/Block Category Tonnage Au Grade
Au Metal
Contained
Au Metal
Contained
(kt) (g/t) (koz) (t)
Wassa Gold Mine /H1118/H1118Measured 6,754 2.97 646 20.08
Indicated 9,984 3.13 1,004 31.24
Inferred 60,893 3.38 6,609 205.53
Total 77,631 3.31 8,258 256.85
Total consolidated /H1118Measured 7,031 3.17 717 22.29
Indicated 17,203 3.55 1,962 61.03
Inferred 66,895 3.40 7,316 227.54
Total 91,129 3.41 9,995 310.86
Notes:
1. As to the Sepon Gold and Copper Mine and Wassa Gold Mine, the Mineral Resources include the
resources from open-pit, underground and stockpile.
2. Numbers have been subject to rounding. Accordingly, figures shown as totals in the table may not be
an arithmetic aggregation of the figures preceding them.
As of September 30, 2024, the Mineral Resources for Sepon Gold and Copper Mine are
estimated to be about 13,498 thousand tonnes with an average Au grade of 4.00 g/t, including
approximately 276 thousand tonnes of Measured Mineral Resources with an average Au grade
of 7.98 g/t, 7,220 thousand tonnes of Indicated Mineral Resources with an average Au grade
of 4.13g/t, 6,002 thousand tonnes of Inferred Mineral Resources with an average Au grade of
3.67 g/t. The Mineral Resources for Wassa Gold Mine are estimated to be about 77,631
thousand tonnes with an average Au grade of 3.31 g/t, including approximately 6,754 thousand
tonnes of Measured Mineral Resources with an average Au grade of 2.97 g/t, 9,984 thousand
tonnes of Indicated Mineral Resources with an average Au grade of 3.13g/t, 60,893 thousand
tonnes of Inferred Mineral Resources with an average Au grade of 3.38 g/t.
As of September 30, 2024, the Mineral Resources for our overseas mines are estimated
to be about 91,129 thousand tonnes with an average Au grade of 3.41 g/t, including
approximately 7,031 thousand tonnes of Measured Mineral Resources with an average Au
grade of 3.17 g/t, 17,203 thousand tonnes of Indicated Mineral Resources with an average Au
grade of 3.55 g/t, 66,895 thousand tonnes of Inferred Mineral Resources with an average Au
grade of 3.40 g/t.
SUMMARY
–8–


--- page 20 ---
The following table, which is based on the Competent Person’s Report prepared in
accordance with the JORC Code, sets forth the information of our gold Reserves in Laos and
Ghana as of September 30, 2024:
Mineralized Zone/Block Category Tonnage Au Grade
Au Metal
Contained
Au Metal
Contained
(kt) (g/t) (koz) (t)
Sepon Gold and
Copper Mine –
Gold /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Proved 268 4.70 41 1.26
Probable 7,628 3.05 749 23.30
Total 7,896 3.11 790 24.56
Wassa Gold Mine /H1118/H1118/H1118Proved 3,521 2.14 242 7.53
Probable 5,291 2.12 360 11.19
Stockpile 30 1.33 1.27 0.04
Total 8,842 2.12 603 18.76
Total consolidated /H1118Proved 3,790 2.32 283 8.79
Probable 12,918 2.67 1,109 34.49
Stockpile 30 1.33 1.27 0.04
Total 16,738 2.59 1,393 43.32
Notes:
1. As to the Sepon Gold and Copper Mine and Wassa Gold Mine, the Ore Reserves include the ore from
open pit, underground and stockpile.
2. Numbers have been subject to rounding. Accordingly, figures shown as totals in the table may not be
an arithmetic aggregation of the figures preceding them.
As of September 30, 2024, the Ore Reserves for Sepon Gold and Copper Mine are about
7,896 thousand tonnes with an average Au grade of 3.11 g/t, of which 268 thousand tonnes are
Proved Ore Reserves with an average Au grade of 4.70 g/t, and 7,628 thousand tonnes are
Probable Ore Reserves with an average Au grade of 3.05 g/t. The Ore Reserves for Wassa Gold
Mine are about 8,842 thousand tonnes with an average Au grade of 2.12 g/t, of which 3,521
thousand tonnes are Proved Ore Reserves with an average Au grade of 2.14 g/t, 5,291 thousand
tonnes are Probable Ore Reserves with an average Au grade of 2.12 g/t, and 30 thousand tonnes
are Stockpile with an average Au grade of 1.33 g/t.
As of September 30, 2024, the Ore Reserves for our overseas mines are about 16,738
thousand tonnes with an average Au grade of 2.59 g/t, of which 3,790 thousand tonnes are
Proved Ore Reserves with an average Au grade of 2.32 g/t, 12,918 thousand tonnes are
Probable Ore Reserves with an average Au grade of 2.67 g/t, and 30 thousand tonnes are
Stockpile with an average Au grade of 1.33 g/t.
SUMMARY
–9–


--- page 21 ---
Our Other Mineral Resources and Ore Reserves in the PRC
The following table, which is based on the Competent Person’s Report prepared in
accordance with the JORC Code, sets forth the information of our non-ferrous metal Resources
in the PRC conducted through our subsidiary, Hanfeng Mining, which owned two mining areas,
namely the Lishan Mining Area and the Dongfeng Mining Area, as of September 30, 2024:
Lishan Mining Area Dongfeng Mining Area
Category Tonnage Zn Grade
Zn Metal
Contained Cu Grade
Cu Metal
Contained Pb Grade
Pb Metal
Contained Tonnage Mo Grade
Mo Metal
Contained
(kt) % (kt) % (kt) % (kt) (kt) % (kt)
Measured /H1118/H1118/H1118/H1118/H1118752 2.36 18 – – 0.12 1 1,819 0.11 2
Indicated /H1118/H1118/H1118/H1118/H11188,583 2.66 229 0.07 6 0.12 10 26,495 0.12 32
Inferred /H1118/H1118/H1118/H1118/H111810,616 2.90 308 0.09 10 0.13 14 37,053 0.12 45
Total /H1118/H1118/H1118/H1118/H1118/H1118/H111819,951 2.78 554 0.08 16 0.13 25 65,367 0.12 79
Notes:
1. Numbers have been subject to rounding. Accordingly, figures shown as totals in the table may not be an
arithmetic aggregation of the figures preceding them.
2. It should be noted that only the Lishan Lower Part (Stage 1) is included in the Ore Reserves, as there are
insufficient technical studies regarding the Lishan Lower Part (Stage 2) and the Dongfeng Lower Part.
The following table, which is based on the Competent Person’s Report prepared in
accordance with the JORC Code, sets forth the information of our non-ferrous metal Reserves
in the PRC conducted through our subsidiary, Hanfeng Mining, which owned two mining areas,
namely the Lishan Mining Area and the Dongfeng Mining Area, as of September 30, 2024:
Lishan Mining Area
Category Tonnage Zn Grade
Zn Metal
Contained
(kt) (%) (kt)
Proved /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118390 2.26 9
Probable /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,920 2.47 72
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,310 2.45 81
Note:
1. Numbers have been subject to rounding. Accordingly, figures shown as totals in the table may not be
an arithmetic aggregation of the figures preceding them.
SUMMARY
–1 0–


--- page 22 ---
Our Mineral Resources and Ore Reserves in Laos
The following table, which is based on the Competent Person’s Report prepared in
accordance with the JORC Code, sets forth the information of our copper Resources in Laos
conducted at LXML, as of September 30, 2024:
Mineralized Zone/Block Category Tonnage Cu Grade
Cu Metal
Contained
(kt) (%) (kt)
Sepon Gold and Copper
Mine – Copper /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Measured – – –
Indicated 4,416 1.45 64
Inferred 2,078 0.98 20
Total 6,493 1.30 85
Note:
1. Numbers have been subject to rounding. Accordingly, figures shown as totals in the table may not be
an arithmetic aggregation of the figures preceding them.
The following table, which is based on the Competent Person’s Report prepared in
accordance with the JORC Code, sets forth the information of our copper Reserves in Laos
conducted at LXML, as of September 30, 2024:
Mineralized Zone/Block Category Tonnage Cu Grade
Cu Metal
Contained
(kt) (%) (kt)
Sepon Gold and Copper
Mine – Copper /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Proved – – –
Probable 1,185 0.93 11.05
Total 1,185 0.93 11.05
Note:
1. Numbers have been subject to rounding. Accordingly, figures shown as totals in the table may not be
an arithmetic aggregation of the figures preceding them.
SUMMARY
–1 1–


--- page 23 ---
Our Gold Production Volume
The following table sets forth our ore mined volume, ore processed volume and mine production volume in relation to our gold mining
businesses for the periods indicated:
Y ear Ended December 31, Nine Months Ended September 30,
2023
Nine Months Ended September 30,
20242021 2022 2023
Ore
Mined
Ore
Processed
Gold
Production
Processing
Capacity
Utilisation 1
Rate
Ore
Mined
Ore
Processed
Gold
Production
Processing
Capacity
Utilisation 1
Rate
Ore
Mined
Ore
Processed
Gold
Production
Processing
Capacity
Utilisation 1
Rate
Ore
Mined
Ore
Processed
Gold
Production
Processing
Capacity
Utilisation 1
Rate
Ore
Mined
Ore
Processed
Gold
Production
Processing
Capacity
Utilisation 1
Rate
(kt) (kt) (koz) (kt/a) (kt) (kt) (koz) (kt/a) (kt) (kt) (koz) (kt/a) (kt) (kt) (koz) (kt/a) (kt) (kt) (koz) (kt/a)
Wulong Gold Mine 6 /H1118/H1118/H1118/H1118383 383 28.0 400 96% 389 423 43.8 1,000 42% 577 578 59.2 1,000 58% 444 401 40.3 750 53% 529 514 47.5 750 69%
Jilong Gold Mine 1, 6 /H1118/H1118/H1118 138 146 34.3 120 122% 153 156 29.5 120 130% 155 155 44.7 120 129% 110 112 31.2 90 124% 161 168 27.5 170 99%
Huatai Gold Mine 2, 6 /H1118/H1118/H1118 56 60 4.9 60 100% 18 19 1.3 60 32% 1 2 0.5 60 3% 1 2 1.5 45 4% – – – 45 –
Jintai Gold Mine 3/H1118/H1118/H1118/H1118/H1118 – – – – – – – – 122 122 2.4 140 88% – – – 0 – 459 459 6.6 360 100%
Sepon Gold and Copper
Mine – Gold 4, 6 /H1118/H1118/H1118/H11184,237 3,407 193.0 3,800 90% 3,794 3,792 199.5 3,800 100% 2,790 3,085 193.2 3,800 81% 1,787 2,457 140.9 2,850 86% 1,890 2,355 125.9 2,850 83%
Wassa Gold Mine 5, 6 /H1118/H1118/H1118 – – – – – 2,024 1,969 162.1 2,700 73% 2,530 2,551 161.5 2,700 94% 1,920 1,850 116.1 2,025 91% 2,211 2,300 138.1 2,025 114%
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,814 3,996 260.2 4,380 91% 6,378 6,359 436.2 7,680 83% 6,175 6,493 461.5 7,820 83% 4,262 4,822 330.0 5,760 84% 5,250 5,796 345.6 6,200 92%
Notes:
1. Utilization rate is calculated by dividing the amount of ore processed by the processing capacity. For some of the periods, the utilisation rate wer e over 100%. This was mainly
because the relevant processing plants actually operated for more days than the planned schedule as the annual maintenance work took less than the ant icipated time.
2. The ore mined, ore processed, gold production, processing capacity and utilisation rate of Huatai Gold Mine began to decline since 2021. This is mai nly because the technical
renovation and expansion project of Huatai Gold Mine commenced in 2021. Since then, the production of Huatai Gold Mine gradually declined due to the im pact from the
engineering upgrades. For more details regarding the year-to-year comparison of the gold production volume, please refer to “— Our Gold Production B usiness in China —
Overview — Operation Performance.”
SUMMARY
–1 2–


--- page 24 ---
3. In January 2023, we completed the acquisition of a 51% equity interest in Xinhenghe Mining, which in turn directly holds a 90% equity interest in Jint ai Mining, which operates
the Jintai Gold Mine, and we began consolidating the accounts of Jintai Mining from January 31, 2023. As such, ore mined volume, ore processed volume an d mine production
volume of Jintai Gold Mine prior to January 31, 2023 was not included in our Group. For more details, please see “Financial Information — Key Factors Aff ecting Our Results
of Operations — Acquisitions — Acquisition of Xinhenghe Mining.”
4. The volume of the ore mined of Sepon Gold and Copper Mine declined over the Track Record Period, mainly because we were upgrading the mining systems of Sepon Gold
and Copper Mine to enhance the capacity, which affected the mining operations, and we have utilised part of the ore inventory which were mined in past pe riods. The volume
of ore processed decreased as Sepon Gold and Copper Mine started underground mining in 2023 and the underground operation provides higher grade ore bu t with smaller
volume. For more details regarding the year-to-year comparison of the gold production volume, please refer to “— Our Gold Production Business in Laos — Overview —
Operation Performance.”
5. In January 2022, we acquired a 62% equity interest in Golden Star Resources, which in turn indirectly holds a 90% equity interest in GSWL, and we began consolidating the
accounts of Golden Star Resources from February 1, 2022. As such, ore mined volume, ore processed volume and mine production volume of Wassa Gold Mine p rior to February
1, 2022 was not included in our Group. For more details, please see “Financial Information — Key Factors Affecting Our Results of Operations — Acquisit ions — Acquisition
of Golden Star Resources.”
6. For some of the years, the volume of “ore processed” was higher than the volume of “ore mined.” This was mainly because some of the ore mined during the p revious year
was kept as inventory and was processed in the following year which added up to the aggregated amount of the “ore processed” for that year.
SUMMARY
–1 3–


--- page 25 ---
Our Other Mineral Resources Production Volume
The following table sets forth the ore mined volume, ore processed volume and mine
production volume in relation to our other Mineral Resources businesses for the periods
indicated:
Y ear Ended December 31,
Nine
Months
Ended
September 30,
2023
Nine
Months
Ended
September 30,
20242021 2022 2023
(kt) (kt) (kt) (kt) (kt)
Ore Mined
Hanfeng Polymetallic Mine
– Polymetallic metals /H1118/H1118/H1118510 502 457 247 549
Sepon Gold and Copper
Mine – Copper
cathodes
1 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181 4 9 – –––
Ore Processed
Hanfeng Polymetallic Mine
– Polymetallic metals /H1118/H1118/H1118506 579 434 220 534
Sepon Gold and Copper
Mine – Copper cathodes /H1118 255 772 1,105 802 843
Processing Capacity
Hanfeng Polymetallic Mine
– Polymetallic metals /H1118/H1118660 660 660 500 675
Sepon Gold and Copper
Mine – Copper cathodes
1 260 800 1,150 850 850
Utilisation Rate 2
Hanfeng Polymetallic Mine
– Polymetallic metals /H1118/H1118/H111877% 88% 66% 44% 79%
Sepon Gold and Copper
Mine – Copper cathodes /H1118 98% 97% 96% 94% 99%
Production Volume
Hanfeng Polymetallic Mine
Zinc concentrate
powder /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819.93 22.04 11.29 5.55 10.18
Lead concentrate
powder /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183.48 3.31 2.72 1.43 2.63
Copper concentrate
powder /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.93 2.05 1.44 0.63 1.19
Molybdenum concentrate
powder
3 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 0.04 0.21 0.07 0.49
Sepon Gold and Copper
Mine – Copper cathodes /H1118 5.02 6.43 6.49 4.94 4.03
SUMMARY
–1 4–


--- page 26 ---
Notes:
1. The ore mined volume for the Sepon Gold and Copper Mine’s copper mine dropped to zero in 2022,
because Sepon Gold and Copper Mine resumed gold production in 2020, while only keeping a small
portion of processing capacity for its copper business since then. For the reason behind the halt in gold
production at the copper mine of the Sepon Gold and Copper Mine, please refer to “Business — Our
Gold Production Business in Laos — Overview.” As of the Latest Practicable Date, the Sepon Gold and
Copper Mine did not have any active copper mining projects while only processed the ore from its
stockpile.
2. Utilization rate is calculated by dividing the amount of ore processed by the processing capacity. For
some of the periods, the utilisation rate was over 100%. This was because the relevant processing plants
actually operated for more days than the planned schedule as the annual maintenance work took less
than the anticipated time.
3. There was no molybdenum production volume for the year of 2021, mainly because the Dongfeng Mine
was conducting exploration and had not yet initiated molybdenum mining activities.
Our Revenue Breakdown
During the Track Record Period, we generated revenue from the PRC, Laos and Ghana.
The following table sets forth a breakdown of our revenue by origin of our products for the
periods indicated:
Y ear Ended December 31, Nine Months Ended September 30,
2021 2022 2023 2023 2024
RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 %
(unaudited)
PRC /H1118/H1118/H1118/H1118/H1118/H11181,259,688 33.3 1,477,471 23.5 2,026,833 28.1 1,301,395 25.7 1,793,374 28.8
Laos /H1118/H1118/H1118/H1118/H1118/H11182,522,936 66.7 2,998,740 47.9 3,054,614 42.3 2,239,406 44.2 2,327,466 37.4
Ghana /H1118/H1118/H1118/H1118/H1118– – 1,790,576 28.6 2,139,505 29.6 1,521,492 30.1 2,101,991 33.8
Total /H1118/H1118/H1118/H1118/H1118/H11183,782,624 100.0 6,266,787 100.0 7,220,952 100.0 5,062,293 100.0 6,222,831 100.0
Notes:
1. Our revenue in Ghana was generated from Golden Star Resources. In January 2022, we acquired a 62% equity
interest in Golden Star Resources, which in turn indirectly holds a 90% equity interest in GSWL, and we began
consolidating the accounts of Golden Star Resources from February 1, 2022. As such, the revenue of GSWL
prior to February 1, 2022 was not included in our Group. For more details, please see “Financial Information
— Key Factors Affecting Our Results of Operations — Acquisitions — Acquisition of Golden Star Resources”.
2. Our gold products are sold globally. Our major clients are refineries located in PRC, Thailand, Australia,
Singapore, South Africa and Ghana.
SUMMARY
–1 5–


--- page 27 ---
During the Track Record Period, we generated our revenue primarily from gold mining,
other Mineral Resources and other businesses. The following table sets forth the breakdown of
our revenue by business segment for the periods indicated:
Y ear Ended December 31, Nine Months Ended
September 30, 20242021 2022 2023
RMB’000 % RMB’000 % RMB’000 % RMB’000 %
Gold mining /H1118/H11182,968,694 78.5 5,304,729 84.6 6,322,263 87.6 5,561,259 89.4
Other Mineral
Resources /H1118/H1118551,278 14.6 650,206 10.4 495,752 6.8 454,130 7.3
Silver /H1118/H1118/H1118/H1118/H1118/H1118/H11185,163 0.1 17,391 0.3 3,107 0.0 3,689 0.1
Copper
cathodes /H1118/H1118/H1118337,440 9.0 393,342 6.3 381,569 5.3 241,677 3.9
Copper
concentrate
powder /H1118/H1118/H1118/H111838,011 1.0 21,756 0.3 15,962 0.2 6,866 0.1
Lead
concentrate
powder /H1118/H1118/H1118/H111834,700 0.9 39,734 0.6 29,744 0.4 38,826 0.6
Zinc
concentrate
powder /H1118/H1118/H1118/H1118135,964 3.6 174,303 2.8 65,370 0.9 81,595 1.3
Molybdenum
concentrate
powder /H1118/H1118/H1118/H1118– – 3,680 0.1 – – 81,477 1.3
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118262,652 6.9 311,852 5.0 402,937 5.6 207,442 3.3
Total/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,782,624 100.0 6,266,787 100.0 7,220,952 100.0 6,222,831 100.0
Note:
1. “Others” primarily comprised recycling of waste electronic products and electrical appliances business
conducted through Guangyuan Technology. The major customers of Guangyuan Technology are enterprises in
the metal products manufacturing and resource recycling sectors.
SUMMARY
–1 6–


--- page 28 ---
Our Gold Sales Volume and Average Selling Price
The following table sets forth our sales volume and average selling price of gold mining
business for the periods indicated.
Y ear Ended December 31, Nine Months Ended September 30,
2021 2022 2023 2023 2024
Sales Vol.
Avg.
Selling
Price Sales Vol.
Avg.
Selling
Price Sales Vol.
Avg.
Selling
Price Sales Vol.
Avg.
Selling
Price Sales Vol.
Avg.
Selling
Price
koz RMB/g koz RMB/g koz RMB/g koz RMB/g koz RMB/g
Wulong Gold Mine /H1118 28.0 383.0 43.8 395.6 59.2 455.8 40.3 447.2 47.5 543.7
Jilong Gold Mine /H1118/H1118 34.3 371.4 29.5 397.3 44.7 455.8 31.2 449.5 27.5 536.9
Huatai Gold Mine /H1118/H1118 4.9 368.4 1.3 400.4 0.5 429.0 0.5 424.9 0.0 0.0
Jintai Gold Mine /H1118/H1118 0.0 0.0 0.0 0.0 2.2 470.3 0.0 0.0 6.8 537.9
PRC – Subtotal/
average /H1118/H1118/H1118/H1118/H1118/H111867.2 376.0 74.6 396.4 106.6 455.9 72.0 448.0 81.8 540.9
Sepon Gold and
Copper Mine /H1118/H1118/H1118183.4 382.5 214.2 389.3 193.8 443.1 143.5 432.7 131.2 507.3
Wassa Gold Mine /H1118/H1118 0.0 0.0 156.5 367.7 166.0 414.2 120.0 407.7 139.1 484.8
Overseas – Subtotal/
average /H1118/H1118/H1118/H1118/H1118/H1118183.4 382.5 370.7 380.2 359.8 429.7 263.5 421.3 270.3 495.7
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118250.6 380.8 445.3 382.9 466.4 435.7 335.5 427.0 352.1 506.2
Note: The average selling price was determined based on the gold metal contained in the gold products despite the
variant grades of the products.
The Life and the Current Status of our Mines
Wulong Gold Mine, Jilong Gold Mine, Jintai Gold Mine, Hanfeng Polymetallic Mine,
Sepon Gold and Copper Mine, and Wassa Gold Mine are currently in operation and each of
them has LOM of 12, 9, 11, 8, 7, and 5 years respectively. Huatai Gold Mine has LOM of 28
years and is currently under renovation. LOM is calculated based on Ore Reserves as of
September 30, 2024 according to the SRK Report.
Development Plan and Planned Production Schedule
Development Plan
For Wulong Gold Mine, we plan to undertake the renovation of shaft and the expansion
of tunnels, including shaft deepening projects and technical renovation projects in 2025 and
2026. In 2027, we plan to increase our mining capacity by 33.1% compared to 2024.
SUMMARY
–1 7–


--- page 29 ---
For Jilong Gold Mine, we plan to undertake the renovation of shaft and ventilation shafts
and expand the tunnels in 2025 and 2026. In 2027, we plan to increase our mining capacity by
33.1% compared to 2024.
For Huatai Gold Mine, we plan to continue with the technical renovation projects in 2025.
In 2026, we plan to substantially complete the infrastructure development and increase the
annual mining capacity by 30,000 tonnes.
For Jintai Gold Mine, we plan to increase the annual gold production to 1 tonnes in 2025.
For Sepon Gold and Copper Mine, we plan to make follow-up investments in the Far West
Mine, including the construction of a tailings storage facility, and establish a copper ore
processing plant with an annual capacity of 1 million tonnes in 2025. In 2027, we plan to
increase our annual gold production to 7 tonnes and our copper annual production to 30,000
tonnes.
For Wassa Gold Mine, we plan to carry out deep and peripheral exploration, as well as
intensified drilling operations, and initiate the construction of the transition from surface to
underground mining of the Father Brown Mine from 2025 to 2027.
For Hanfeng Polymetallic Mine, we plan to establish a 5,000-tonne ore processing plant
for the Dongfeng Molybdenum Mine in 2026.
For details of the development plans of our mines, please refer to “Business —
Development Plan and Production Schedule — Development Plan.”
Planned Production Schedule
The following chart sets forth the planned mining and production schedule for the
operations in Wulong Gold Mine and Jilong Gold Mine for the periods indicated over the life
of mine:
Underground Gold
Mine in China Unit LOM
2024
Q4 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035
Jilong
Mined Tonnes /H1118/H1118/H1118/H1118/H1118k t 9 1 9 8 8 1 8 4 1 8 0 1 9 4 1 0 9 5 8 5 5 3 8 1 3–––
Milled Tonnes /H1118/H1118/H1118/H1118/H1118k t 9 1 9 8 8 1 8 4 1 8 0 1 9 4 1 0 9 5 8 5 5 3 8 1 3–––
Gold Produced /H1118/H1118/H1118/H1118k o z 2 5 0 2 4 4 3 3 7 4 6 3 1 2 2 2 2 1 87–––
Wulong
Mined Tonnes /H1118/H1118/H1118/H1118/H1118kt 984 27 99 99 98 99 108 108 102 101 66 44 33
Milled Tonnes /H1118/H1118/H1118/H1118/H1118kt 984 27 99 99 98 99 108 108 102 101 66 44 33
Gold Produced /H1118/H1118/H1118/H1118k o z 2 1 0 52 22 52 22 12 32 42 11 71 51 0 4
SUMMARY
–1 8–


--- page 30 ---
Notes:
1. The planned production schedule of the LOM was made based on the data collected of our PRC Gold Mines
as of September 30, 2024.
2. LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year since
September 30, 2024, until all Ore Reserves are extracted in the final year. The forecasted production volume
is estimated based on the designed mining capacity, scheduling strategy and expansion timelines. For details,
please refer to the mine schedule set forth in “Business — Development Plan and Planned Production Schedule
— Planned Production Schedule.”
3. As Huatai Gold Mine is currently under technical renovation, and Jintai Gold Mine is of less significance of
production compared to Jilong Gold Mine and Wulong Gold Mine, we only include details of Jilong Gold Mine
and Wulong Gold Mine in the charts above.
The following chart sets forth the planned mining and production schedule for the
operations at the Sepon Gold and Copper Mine for the periods indicated over the life of mine:
Type Unit LOM
2024
Q4 2025 2026 2027 2028 2029 2030
LXML
Mined Tonnes Gold /H1118/H1118/H1118/H1118/H1118/H1118/H1118kt 7,896 1,435 2,803 1,909 770 546 402 31
Mined Tonnes Copper /H1118/H1118/H1118/H1118/H1118/H1118kt 1,185 447 73 8–––––
Total Mined Tonnes /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118kt 9,081 1,882 3,542 1,909 770 546 402 31
Milled Tonnes Gold /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118kt 7,896 1,435 2,803 1,909 770 546 402 31
Milled Tonnes Copper /H1118/H1118/H1118/H1118/H1118/H1118kt 1,185 447 73 8–––––
Total Milled Tonnes /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118kt 9,081 1,882 3,542 1,909 770 546 402 31
Gold Produced /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118kg 15,963 1,568 5,152 4,912 1,803 1,353 1,108 66
Gold Produced /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118koz 513 50 166 158 58 44 36 2
Copper Produced /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118k t 523–––––
Notes:
1. The planned production schedule of the LOM of 7 years was made based on the data collected from the Sepon
Gold and Copper Mine since September 30, 2024.
2. LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year since
September 30, 2024, until all Ore Reserves are extracted in the final year. The forecasted production volume
is estimated based on the designed mining capacity, scheduling strategy and expansion timelines. For details,
please refer to the mine schedule set forth in “Business — Development Plan and Planned Production Schedule
— Planned Production Schedule”.
SUMMARY
–1 9–


--- page 31 ---
The following chart sets forth the planned mining and production schedule for the
operations at the Wassa Gold Mine for the periods indicated over the life of mine:
Wassa Gold Mine in Ghana Unit LOM 2024Q4 2025 2026 2027 2028
Wassa_Basic Plan
Mined_Tonnes /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118kt 8,812 979 3,209 2,517 1,614 493
Milled Tonnes /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118kt 8,812 979 3,209 2,517 1,614 493
Gold Produced /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118kg 17,955 1,981 6,000 5,533 3,474 967
Gold Produced /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118koz 577 64 193 178 112 31
Wassa_Upside Plan
Mined_Tonnes /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118kt 9,986 979 3,209 2,517 1,614 1,667
Milled Tonnes /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118kt 9,986 979 3,209 2,517 1,614 1,667
Gold Produced /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118kg 19,897 1,981 6,000 5,533 3,474 2,908
Gold Produced /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118koz 640 64 193 178 112 94
Notes:
1. The planned production schedule for the LOM includes two scenarios: the basic plan and the upside plan. The
upside plan includes residual material in the upper area and material in the lower area, which SRK views as
a potential economic opportunity but does not classify as Ore Reserves due to insufficient technical studies.
Both LOM scenarios span five years and were developed based on data collected from the Wassa Gold Mine
as of September 30, 2024.
2. LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year since
September 30, 2024, until all Ore Reserves are extracted in the final year. The forecasted production volume
is estimated based on the designed mining capacity, scheduling strategy and expansion timelines. For details,
please refer to the mine schedule set forth in “Business — Development Plan and Planned Production Schedule
— Planned Production Schedule”.
For the charts set forth the planned mining and production schedule for the operations at
the Huatai Gold Mine and Jintai Gold Mine, please refer to “Business — Our Gold Production
Business in PRC — Planned Production Schedule”. For the chart sets forth the planned mining
and production schedule for the operations at the Hanfeng Polymetallic Mine, please refer to
“Business — Our Other Mineral Resources Production Business in China — Planned
Production Schedule”.
SUMMARY
–2 0–


--- page 32 ---
Cash Operating and Production Costs
Cash operating costs for our PRC Gold Mines primarily consist of labor cost, material cost, electricity cost and some other costs. The table
below is based on the SRK Report and sets forth a summary of historical and forecast of the cash operating costs and cash operating costs per gram
of gold produced of our PRC Gold Mines for the years indicated.
The anticipated fluctuations in future cash operating costs are primarily driven by several factors, which vary across the gold mines. For some
mines, the expansion of mining capacity is expected to increase gold production, thereby reducing unit costs. In others, higher gold grades in the
deeper zones contribute to greater gold output and further reductions in unit costs. Specifically, the production schedule of each of Wulong Gold
Mine and Jilong Gold Mine in the SRK Report solely focuses on stope production and excludes ore from comprehensive utilization as recorded in
historical data. As a result, it is anticipated that gold production of these two mines will be lower compared to previous figures, thus leading to an
increase in unit costs.
Wulong Gold Mine 1 Unit 2021 2022 2023 2024Q1-Q3 LOM 2 2024Q4 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035
Gold Produced /H1118/H1118/H1118/H1118/H1118/H1118kg 791 1,222 1,824 1,477 6,538 3 153 678 785 687 668 717 741 668 535 465 303 139
Labor /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 101.31 77.62 76.70 73.14 100.89 4 120.61 97.55 84.66 95.50 99.54 100.62 98.06 102.46 126.27 95.11 97.10 159.12
Material /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 24.02 46.03 46.62 33.25 49.95 4 59.72 48.30 41.92 47.28 49.28 49.82 48.55 50.73 62.51 47.09 48.07 78.78
Electricity /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 35.54 34.25 21.05 22.44 15.06 4 18.00 14.56 12.64 14.26 14.86 15.02 14.64 15.29 18.85 14.20 14.49 23.75
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 82.03 74.76 53.23 67.59 46.93 4 56.10 45.38 39.38 44.42 46.30 46.80 45.61 47.66 58.73 44.24 45.17 74.02
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 242.90 232.66 197.59 196.42 212.83 5 254.44 205.79 178.60 201.46 209.99 212.25 206.86 216.14 266.36 200.63 204.83 335.66
SUMMARY
–2 1–


--- page 33 ---
Jilong Gold Mine 1 Unit 2021 2022 2023 2024Q1-Q3 LOM 2 2024Q4 2025 2026 2027 2028 2029 2030 2031 2032
Gold Produced /H1118/H1118/H1118/H1118/H1118kg 1,048 811 1,390 795 7,782 3 754 1,327 1,142 1,444 973 687 695 549 211
Labor /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 56.20 77.88 43.98 81.16 73.23 4 72.02 85.87 97.80 83.38 69.61 52.78 48.84 42.36 39.66
Material /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 18.31 30.18 17.44 34.06 27.27 4 26.82 31.97 36.42 31.05 25.92 19.65 18.19 15.77 14.77
Electricity /H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 10.54 13.25 7.74 16.90 9.44 4 9.28 11.07 12.61 10.75 8.97 6.80 6.30 5.46 5.11
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 66.49 83.02 97.91 92.53 83.06 4 81.68 97.39 110.93 94.56 78.95 59.86 55.39 48.04 44.98
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 151.53 204.32 167.07 224.65 193.00 5 189.80 226.30 257.75 219.74 183.46 139.10 128.72 111.63 104.52
Notes:
1. As Huatai Gold Mine is currently under technical renovation, and Jintai Gold Mine is of less significance of production compared to Jilong Gold Mine and Wulong Gold Mine,
we only include details of Jilong Gold Mine and Wulong Gold Mine in the charts above.
2. LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year since September 30, 2024, until all Ore Reserves are extracted in the final
year. The forecasted production volume is estimated based on the designed mining capacity, scheduling strategy and expansion timelines. For detail s, please refer to the mine
schedule set forth in “Business — Development Plan and Planned Production Schedule — Planned Production Schedule”.
3. “Gold Produced” is the total gold production over the LOM, as the aggregated volume of all the annual production volume.
4. Each of the cost of “Labor”, “Material”, “Electricity” and “Others” is the average cost over the LOM, which is calculated as the total cost over the LO M divided by the total
gold production.
5. “Total” is derived by applying the adjusted historical per-ton cost to the forecasted ore ton each year and then summing over the LOM.
For the charts set forth the cash operating costs for the operations at the Huatai Gold Mine and Jintai Gold Mine, please refer to “Financial
Information — Cash Operating and Production Costs”. For the chart sets forth the cash operating costs for the operations at the Hanfeng Polymetallic
Mine, please refer to “Financial Information — Cash Operating and Production Costs”.
Cash operating costs for our Sepon Gold and Copper Mine primarily consist of labor cost, material cost, electricity cost and some other costs.
The table below is based on the SRK Report and sets forth a summary of historical and forecast of the cash operating costs and cash operating costs
per tonnes of gold and copper produced of our Sepon Gold and Copper Mine for the years indicated.
SUMMARY
–2 2–


--- page 34 ---
At the Sepon Gold and Copper Mine, future cost differences are anticipated to primarily arise from a shift in mining methods. In contrast to
historical operations, which have combined both open-pit and underground mining, future production is expected to rely solely on underground
mining. This transition is anticipated to lead to significant changes in operating costs.
Sepon Gold and Copper Mine 1 Unit 2021 2022 2023 2024Q1-Q3 LOM 2 2024Q4 2025 2026 2027 2028 2029 2030
Gold Produced /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118kg 5,983 6,629 6,009 3,949 15,963 3 1,568 5,152 4,912 1,803 1,353 1,108 66
Copper Produced /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118kt 4.31 6.88 6.17 3.67 4.97 3 1.83 3.1 4–––––
Gold Operation
Labor /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g 4.75 3.42 3.84 4.62 4.45
4 8.23 4.90 3.50 3.84 3.63 3.26 4.31
Material /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g 18.02 26.94 23.32 22.63 25.23 4 46.66 27.75 19.82 21.76 20.59 18.47 24.45
Electricity /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g 2.23 1.84 3.06 3.75 3.46 4 6.40 3.81 2.72 2.99 2.83 2.54 3.36
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g 5.72 3.71 6.69 7.55 6.28 4 13.24 7.59 4.29 4.71 4.46 4.00 5.29
Copper Operation
Labor /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/t 497 417 652 794 2,146
4 2,197 2,11 6–––––
Material /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/t 1,720 3,226 3,896 3,869 7,153 4 7,325 7,05 3–––––
Electricity /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/t 237 207 545 626 954 4 9 7 7 9 4 0–––––
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/t 0.84 0.62 0.70 0.83 3.39 4 3.47 3.3 4–––––
Total (Gold Operation) /H1118/H1118/H1118/H1118/H1118/H1118USD/g 30.72 35.91 36.91 38.54 39.42 5 74.54 44.04 30.33 33.30 31.51 28.27 37.42
Total (Copper Operation) /H1118/H1118/H1118/H1118/H1118USD/t 2,454 3,851 5,093 5,290 10,256 5 10,503 10,11 3–––––
Notes:
1. All costs at the company level of LXML are borne by the gold mine of the Sepon Gold and Copper Mine.
2. LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year since September 30, 2024, until all Ore Reserves are extracted in the final
year. The forecasted production volume is estimated based on the designed mining capacity, scheduling strategy and expansion timelines. For detail s, please refer to the mine
schedule set forth in “Business — Development Plan and Planned Production Schedule — Planned Production Schedule”.
3. “Copper Produced” is the total copper production over the LOM, as the aggregated volume of all the annual production volume. “Gold Produced” is the t otal gold production
over the LOM, as the aggregated volume of all the annual production volume.
4. Each of the cost of “Labor”, “Material”, “Electricity” and “Others” is the average cost over the LOM, which is calculated as the total cost over the LO M divided by the total
gold/copper production.
5. “Total” is derived by applying the adjusted historical per-ton cost to the forecasted ore ton each year and then summing over the LOM.
SUMMARY
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Cash operating costs for our Wassa Gold Mine primarily consist of labor cost, material cost, electricity cost and some other costs. The table
below is based on the SRK Report and sets forth a summary of historical and forecast of the cash operating costs and cash operating costs per gram
of gold produced of our Wassa Gold Mine for the years indicated.
At the Wassa Gold Mine, anticipated future cost differences are expected to primarily result from a transition in mining methods. Specifically,
whereas historical operations have integrated both open-pit and underground mining, future production is projected to be conducted exclusively
through underground mining. This shift is expected to give rise to significant changes in operating costs.
Wassa Gold Mine Unit 2021 2022 2023 2024Q1-Q3 LOM 1 2024Q4 2025 2026 2027 2028
Gold Produced /H1118/H1118/H1118/H1118/H1118kg – 4,835 5,310 5,022 17,955 2 1,981 6,000 5,533 3,474 967
Labor /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g – 6.57 7.40 6.20 10.30 3 10.38 11.23 9.55 9.75 10.70
Material /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g – 12.10 10.70 13.54 18.56 3 18.69 20.22 17.20 17.57 19.28
Electricity /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g – 1.66 3.87 1.87 3.78 3 3.81 4.12 3.50 3.58 3.92
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g – 9.95 11.72 8.75 13.06 3 13.16 14.23 12.10 12.37 13.57
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g – 30.28 33.69 30.36 45.70 4 46.03 49.80 42.35 43.27 47.47
Note:
1. LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year since September 30, 2024, until all Ore Reserves are extracted in the final
year. The forecasted production volume is estimated based on the designed mining capacity, scheduling strategy and expansion timelines. For detail s, please refer to the mine
schedule set forth in “Business — Development Plan and Planned Production Schedule — Planned Production Schedule”.
2. “Gold Produced” is the total gold production over the LOM, as the aggregated volume of all the annual production volume.
3. Each of the cost of “Labor”, “Material”, “Electricity” and “Others” is the average cost over the LOM, which is calculated as the total cost over the LO M divided by the total
gold production.
4. “Total” is derived by applying the adjusted historical per-ton cost to the forecasted ore ton each year and then summing over the LOM.
For the charts set forth the cash operating costs for the operations at the Mengkham Rare Earth Element Project, please refer to “Financial
Information — Cash Operating and Production Costs”.
SUMMARY
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Mining Licenses and Exploration Permits
The following table sets forth information regarding our relevant mining licenses and
exploration permits as of the Latest Practicable Date:
Wulong Mining
Type Serial Number
Permitted
annual
production
volume
(10,000 tons)
Geographical
Area (km 2) Effective Period Status
Mining license /H1118/H1118/H1118/H1118C2100002011084140116558 10 6.2732 December 4, 2020 to
August 4, 2035
V alid
Exploration Permit /H1118/H1118T2100002008044010006347 – 3.88 November 20, 2024 to
November 20, 2029
V alid
Exploration Permit /H1118/H1118T2100002008044010005662 – 0.6112 June 2, 2023 to
June 2, 2028
V alid
Jilong Mining
Type Serial Number
Permitted
annual
production
volume
(10,000 tons)
Geographical
Area (km 2) Effective Period Status
Mining License /H1118/H1118/H1118/H1118C1500002009114120054250 18 8.61 May 1, 2024 to
September 26, 2026
V alid
Mining License /H1118/H1118/H1118/H1118C1500002023124210156146 6 9.1340 December 27, 2023 to
March 27, 2032
V alid
Exploration Permit /H1118/H1118T1500002008044010006035 – 3.83 March 25, 2021 to
March 24, 2026
V alid
Huatai Mining
Type Serial Number
Permitted
annual
production
volume
(10,000 tons)
Geographical
Area (km 2) Effective Period Status
Mining License /H1118/H1118/H1118/H1118C1500002009064120021513 6 2.7978 June 6, 2024 to
June 5, 2044
V alid
Mining License /H1118/H1118/H1118/H1118C1500002011014140119663 6 0.8138 September 15, 2024
to September 14,
2027
V alid
Mining License /H1118/H1118/H1118/H1118C1500002013094210131353 6 1.0164 March 11, 2024 to
September 5, 2025
V alid
Mining License /H1118/H1118/H1118/H1118C1500002015114210140450 3 1.8332 November 17, 2015 to
November 17, 2025
V alid
Mining License /H1118/H1118/H1118/H1118C1500002015114210140451 3 0.3199 November 18, 2024 to
November 17, 2025
V alid
Mining License /H1118/H1118/H1118/H1118C1500002015114210140449 3 3.7362 November 18, 2023 to
November 17, 2025
V alid
SUMMARY
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Jintai Mining
Type Serial Number
Permitted
annual
production
volume
(10,000 tons)
Geographical
Area (km 2) Effective Period Status
Mining license /H1118/H1118/H1118/H1118C5300002012054110124688 14 1.0920 June 7, 2022 to
June 6, 2032
V alid
Exploration Permit /H1118/H1118T5300002009034010026977 – 10.28 June 3, 2021 to
June 3, 2026
V alid
Hanfeng Mining
Type Serial Number
Permitted
annual
production
volume
(10,000 tons)
Geographical
Area (km 2) Effective Period Status
Mining license /H1118/H1118/H1118/H1118C2224002021083210152512 60 2.2250 August 27, 2021 to
August 27, 2050
V alid
Mining license /H1118/H1118/H1118/H1118C2200002010123120093830 9.9 2.4207 February 25, 2025 to
February 24, 2030
V alid
Exploration Permit /H1118/H1118T100000202103302800361 – 2.3191 December 20, 2020 to
December 20, 2025
V alid
LXML
Type Serial Number
Permitted
annual
production
volume
(10,000 tons)
Geographical
Area (km 2) Effective Period Status
Mining License /H1118/H1118/H1118/H1118No. 45-24/MEM.MMD – 130.88 September 30, 2023
to September 29,
2033
V alid
Exploration Permit /H1118/H1118No. 1466/MEM. DGM.3 – 1,010.40 June 14, 2023
to June 14, 2026
V alid
SUMMARY
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GSWL
Type Serial Number
Permitted
annual
production
volume
(10,000 tons)
Geographical
Area (km 2) Effective Period Status
Mining Lease /H1118/H1118/H1118/H1118/H1118LVDGAST35364682022 – 63.00 January 26, 2022
to January 25, 2047
Lease
renewed
and in the
process of
ratification.
Mining Lease /H1118/H1118/H1118/H1118/H1118LVDGAST37993462020 – 19.45 August 25, 2020
to August 24, 2031
V alid
Mining Lease /H1118/H1118/H1118/H1118/H1118LVDGAST38000372020 – 43.00 August 25, 2020
to August 24, 2031
V alid
Exploration Permit /H1118/H1118LVB9113/1994 & PL 2/155 – 24.81 December 13, 2024 to
December 12, 2027
V alid
Exploration Permit /H1118/H1118LVB5528/2005 & PL 2/378 – 96.44 March 4, 2022 to
March 3, 2025
1
V alid
Exploration
(prospecting)
Permit /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
LVB1624/2006 & RL2/117 – 26.9 September 4, 2024 to
September 3, 2027
V alid
Note:
1. We will submit our renewal application prior to the expiry date in accordance with the relevant laws and
regulations, and we and our Ghana Legal Advisor do not expect any legal impediment in the renewal process
for this permit.
The mining rights of the Wassa Gold Mine are pledged to Standard Bank Group in South
Africa to secure short-term loans.
Mining and Processing Capacity
We are advancing multiple underground development projects at the Wulong Gold Mine
to increase its annual processing capacity from 578,000 tonnes to approximately 700,000
tonnes. The mine’s average daily processing capacity increased to over 1,800 tonnes in the
second half of 2023. We will continue to invest in exploration and Reserves enhancement at
the mine to tap into the potential of Resources in the deep and peripheral areas.
SUMMARY
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The Jilong Gold Mine has completed the 180,000-tonne gold ore processing plant
expansion project, and trial production has commenced since June 2024. We plan to increase
annual mining capacity from 120,000 tonnes to approximately 300,000 tonnes by the end of
2025. Additionally, we commenced construction of a new tailings storage facility in November
2023, with other construction projects progressing as planned.
The Huatai Gold Mine will initiate a comprehensive transformation of the mine’s
infrastructure and commence shaft engineering construction. Upon completion, we expect to
increase the Huatai Gold Mine’s annual mining capacity by 30,000 tonnes.
In October 2023, we completed the construction project at the Jintai Gold Mine with its
annual mining and processing capacity of approximately 140,000 tonnes. Since 2024, we
commenced a further expansion project of the Jintai Gold Mine, pursuant to which the
Xidengping mining area is expected to reach an annual mining and processing capacity of
approximately 50,000 tonnes, and the Tangzibian mining area is expected to reach an annual
mining and processing capacity of approximately 600,000 tonnes.
For the Sepon Gold and Copper Mine, it is expected that its annual underground mining
capacity will increase from the current capacity of 536,000 tonnes to 806,000 tonnes. We will
also commence copper production at Khanong area, which has over 6,000,000 tonnes of copper
ore, and over 57,000 tonnes of copper metal contained according to the resource model.
For Wassa Gold Mine, we will further expand our mining and processing capacity, with
a goal to develop the Wassa Gold Mine into a large-scale gold mine and expect to achieve (i)
an annual processing capacity of approximately 3.3 million tonnes and (ii) an annual
production of 350 koz gold.
Hedging Strategy
We have different measures to hedge against the risk of fluctuations in gold price. To
mitigate the risks of future increases in the prices of the gold we intend to lease, we engage
in hedging through forward transactions or by purchasing futures products in the futures
market for the leased gold. As a gold production enterprise, we take risk management strategy
to prevent the risk of gold price declines by selling our gold products in major futures markets,
such as the Shanghai Gold Exchange or the COMEX gold exchange in the U.S., to lock in
prices. The volume of such transactions each year depends on the trend of gold price
fluctuation for that year, but the total volume will not exceed 10% of the annual gold
production according to our internal policy.
We have different measures to hedge against the risk of fluctuations in gold price. For
details, please refer to “Business — Gold Leasing, Hedging and Streaming — Hedging.”
SUMMARY
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OUR MINING OPERATIONS AND PRODUCTION FACILITIES
Our gold production operations in PRC, Laos and Ghana can generally be divided into
two steps, namely, (i) mining and (ii) processing.
PRC
In relation to mining, we primarily utilize the resuing method for our underground mining
at the Wulong Gold Mine, the Jilong Gold Mine and the Huatai Gold Mine, and we also utilize
the open-pit mining method at Jintai Gold Mine. In relation to processing, the Wulong Gold
Mine primarily utilizes the flotation process method, whereas the Jilong Gold Mine and the
Huatai Gold Mine primarily utilize the all-slime cyanidation absorption gold extraction
method, and the Jintai Gold Mine primarily utilize the carbon-in-pulp gold extraction process
method. See “Business — Our Gold Production Business in China — Operating Process of
Gold Production Business in the PRC.”
Laos
In relation to mining, we generally follow the open-pit mining method, and also adopt the
underground mining method. In relation to processing, we utilize the flotation-pressure
oxidation method to process both primary ores and oxide ores. See “Business — Our Gold
Production Business in Laos — Operating Process of Gold Production Business in Laos.”
Ghana
In relation to mining, the Wassa mining area primarily utilizes the open-pit mining
method and the sub level open stoping method, the Hwini Butre mining area utilizes the
open-pit mining method, and the Benso mining area primarily utilizes the open-pit mining
method. In relation to processing, we primarily utilize the gravity-flow all-slime cyanidation
absorption gold extraction method. See “Business — Our Gold Production Business in Ghana
— Operating Process of Gold Production Business in Ghana.”
SALES AND MARKETING
During the Track Record Period, our primary products were gold, copper cathodes and
other Mineral Resources products.
In relation to our sales of products in PRC, our products are sold to a wide range of
customers in China and we adopt different arrangements to determine the price and facilitate
our sales. For our gold production, we determine the selling price based on the spot trading
price of the Shanghai Gold Exchange and the relevant customer’s agreement. For our other
Mineral Resources, we determine sales prices based on the market prices of the relevant metals
contained in the concentrates, including zinc, lead, copper, silver and molybdenum. For our
other production, we determine the sales prices with reference to the quantity of disassembled
products and the market conditions or through bidding process. In relation to our sales of
products in the PRC, we generally enter into sales agreements with our customers on an annual
basis without entering into any long-term agreement. For details, please refer to the section
headed “Business — Sales and Customers — Sales in the PRC.”
SUMMARY
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--- page 41 ---
In relation to our sales of products in Laos, we generally enter into sales agreements with
our customers for one to three years. Given the high quality of our products, various potential
customers have approached us. Accordingly, we believe that it would not be difficult for us to
find alternative customers for sales of products on terms comparable to those we have with our
existing customers. For details, please refer to the section headed “Business — Sales and
Customers — Sales in Laos.”
In relation to our sales of products in Ghana, we generally enter into sales agreements
with our customers for two years or longer terms. For details, please refer to the section headed
“Business — Sales and Customers — Sales in Ghana.”
The mines of our Company are interconnected with local and proximate regions through
an extensive road network, and are further integrated with key transportation infrastructure,
including land, water, and air routes. During the Track Record Period, the products from our
PRC Mines were shipped via land transportation, and the products derived from the Wassa
Gold Mine and Sepon Gold and Copper Mine were generally dispatched via air, ensuring
expeditious and secure delivery to their intended destinations.
OUR CUSTOMERS
During the Track Record Period, our top five customers were refiners and trading
companies of precious metals and other non-ferrous metals as well as banks. For each
year/period of the Track Record Period, revenue contributed by our top five customers
amounted to RMB2,946.2 million, RMB5,345.8 million, RMB5,565.6 million and
RMB4,904.6 million, respectively, accounting for 77.9%, 85.4%, 77.1% and 78.8% of our total
revenue for the same periods. Revenue contributed by our largest customer for each year/period
of the Track Record Period amounted to RMB2,126.6 million, RMB2,602.2 million,
RMB2,672.1 million and RMB2,140.3 million, respectively, accounting for 56.2%, 41.5%,
37.0% and 34.4% of our total revenue for the same periods.
To the best of our knowledge, during the Track Record Period and up to the Latest
Practicable Date, our customers were Independent Third Parties. As of the Latest Practicable
Date, none of our Directors, their associates or any of our shareholders (who or which to the
knowledge of the Directors owned more than 5% of our issued share capital) had any interest
in any of our five largest customers in each year/period of the Track record Period. See
“Business — Sales and Customers — Customers.”
PROCUREMENT AND SUPPLIERS
We conduct our business in China, Laos and Ghana, and we consider that procurement
management excellency is one of our key focuses. We have adopted headquarter-supported
global centralized procurement system to enhance our procurement management efficiency. As
supplemented procurement methods, we also procure individually in each country.
SUMMARY
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In the PRC, we procure a wide range of raw materials used in our mining operations, such
as explosive materials, diesel, sodium cyanide and cement, from local suppliers. And we
procure various machinery and equipment for our production activities, including mining and
processing equipment which mainly comprises rock drilling machines, drilling jumbos,
scrappers, crushing circuits, grinding circuits, flotation circuits, pressure filters, conveyers, and
other ancillary equipment. For details, please see “Business — Procurement and Suppliers —
Our PRC Operations”. In Laos and Ghana, we also procure various materials, such as diesel
fuel, processing chemicals and reagents, explosives, and related consumables, as well as
machinery and equipment for our production operations from (i) different local suppliers in
Laos and Ghana and/or (ii) the original equipment manufacturers. We also procure various
services, such as security services, civil work services, engineering services and loading and
hauling services, from various local suppliers. For details, please see “Business —
Procurement and Suppliers — Our Operations in Laos and Ghana.”
The following table sets forth the annual procurement amounts of all of our subsidiaries,
which are located in PRC, Laos and Ghana, for the periods indicated.
Y ear ended December 31,
Nine Months
ended
September 30,
20242021 2022 2023
(RMB’000)
PRC /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118337,744 420,211 557,791 559,475
Laos /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,050,845 2,229,796 1,685,296 1,372,992
Ghana /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,132,378 1,740,289 1,694,634 1,592,815
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,520,967 4,390,296 3,937,721 3,525,282
During the Track Record Period, all of our top five suppliers in the respective year/period
were service or commodity providers such as suppliers of electricity, fuel, and transportation.
For each year/period of the Track Record Period, purchases from our top five suppliers
amounted to RMB647.3 million, RMB855.2 million and RMB666.5 million and RMB633.9
million, respectively, accounting for 25.6%, 19.1%, 13.7% and 17.6% of our cost of sales for
the same periods, respectively. Purchases from our largest supplier for each year/period of the
Track Record Period amounted to RMB159.5 million, RMB210.6 million, RMB149.5 million
and RMB235.5 million, respectively, accounting for 6.3%, 4.7%, 3.1% and 6.5% of our cost
of sales for the same periods, respectively.
During the Track Record Period and as of the Latest Practicable Date, we did not
experience any material impact to our operation or financial condition due to any significant
fluctuation in prices set by our suppliers or breach of contract on the part of our suppliers.
During the Track Record Period and as of the Latest Practicable Date, none of our Directors,
their associates or any of our shareholders (who or which to the knowledge of the Directors
owned more than 5% of our issued share capital) had any interest in any of our five largest
suppliers, and the top five suppliers in each year/period of the Track record Period are all
Independent Third Parties. See “Business — Procurement and Suppliers — Suppliers.”
SUMMARY
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CONTRACTORS
In the PRC, we outsource a portion of our exploration and shaft construction/engineering
work to qualified contractors. In Laos, we outsource third-party contractors, especially mining
and processing work in our projects in Laos. In Ghana, we engaged third-party contractors to
provide excavation, mining, exploration, processing, construction and drilling services. For
details, please see “Business — Contractors — Our PRC Operations”, “Business —
Contractors — Our Operations in Laos” and “Business — Contractors — Our Operations in
Ghana.”
During the Track Record Period and up to the Latest Practicable Date, we did not
encounter any material disputes with our contractors in PRC, Laos and Ghana or experience
any suspension or delay in our operations as a result of misconduct of our contractors.
COMPETITIVE LANDSCAPE
The gold industry has become more concentrated due to mergers and resource integration
of gold companies. Large gold companies with advantages, such as efficient operations, global
presence, financial strength and other advantages, are leading the industry. At the same time,
regulatory controls, including safety and environmental protection requirements, have further
tightened. Less competitive gold production companies with aging facilities and insufficient
resources have been forced to shut down or undergo significant changes. Furthermore, the total
production cost of gold mining has increased due to several factors, and smaller gold
companies have gradually exited the market. The CR10 Concentration Ratio, which is an
indicator used to measure market concentration and represents the total market share of the top
ten companies in a specific market, of the gold industry increased from 24.4% in 2021 to 25.6%
in 2023. See “Industry Overview — Competitive Landscape” for more details.
REGULATORY REGIMES
We conduct business in Ghana, and on July 31, 2018, the Ghanaian Minister of Lands and
Natural Resources informed the Ghanaian Chamber of Mines of the Government of Ghana’s
intention to exercise its right of pre-emption to acquire up to 20% of all gold mined in Ghana
for the benefit of Ghanaian refineries. In November 2022, the Government of Ghana directed
all gold mining companies, effective January 2023 to sell up to 20% of their products produced
in Ghana to the Bank of Ghana at the World Market Spot Price for Ghanaian Cedis. We
generally are able to utilize all Ghanaian Cedis for our operating expenses, but there is a risk
that our holding of Ghanaian Cedis is subject to fluctuation and foreign exchange loss.
We conduct business in Laos, and Laos is not a member of the IOSCO or a signatory to
the IOSCO MMOU. Our Group’s place of central management and control is in the PRC,
taking into account, among other things, that: (i) our Group is headquartered in Beijing, and
all its Directors and senior management are PRC citizens and/or based in the PRC (including
Hong Kong); (ii) the decision-making process and business activities of our Group’s operations
in the PRC, Laos and Ghana are centrally managed, monitored and approved by our Group’s
SUMMARY
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headquarters in Beijing; (iii) as our Group’s A shares are listed on the SSE, (a) our principal
books and records are located and maintained in the PRC; and (b) we are regulated by the
CSRC and the SSE and subject to applicable laws and regulations in the PRC. In particular, our
Group and its Directors are obliged to provide the CSRC and the SSE with all the information
relating to our Group’s affairs (including its Laos operations) to facilitate their understanding
of its business operations and respond to their enquiry and/or investigation. CSRC is a full
signatory to the IOSCO MMOU. Therefore, this enables the Commission to seek regulatory
assistance and information, facilitating its investigations and enforcement actions, and
ensuring compliance with Rule 8.02A.
Furthermore, we are subject to Chapter 18 of the Listing Rules as a mineral company.
EFFECTS OF THE COVID-19 OUTBREAK
In 2020, the outbreak of COVID-19 in the PRC and around the globe led to an
international public health crisis and, as a result, the global economy in general was materially
and adversely affected. Our Group’s business operations were briefly impacted by the outbreak
in early 2020 due to restrictions on social and work gatherings, mandatory quarantine
requirements and suspended public transportation in certain areas in China, Laos and Ghana.
As some of our Group’s employees had to work from home, the operations that required onsite
service were interrupted to a limited extent. However, we resumed normal business operations
after the initial disruptions in early 2020. In addition, China experienced widespread
COVID-19 resurgence in late 2022 and early 2023, but the emergency measures taken by the
Chinese government quickly brought the situation under control. Despite the significance of
the pandemic, COVID-19 did not have any material adverse impact on our business operation
or key operating performance during the Track Record Period.
SUMMARY OF HISTORICAL FINANCIAL INFORMATION
The following is a summary of our historical financial information as of and for the years
ended December 31, 2021, 2022 and 2023 and the nine months ended September 30, 2023 and
2024 extracted from the Accountants’ Report set out in Appendix IA to this Prospectus. The
summary below should be read in conjunction with the consolidated financial information in
Appendix IA, including the accompanying notes and the information set forth in the section
headed “Financial Information” in this Prospectus.
SUMMARY
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Summary of Results of Operations
The following table sets forth a summary of our results of operations for the periods
indicated. Our historical results presented below are not necessarily indicative of the results
that may be expected for any future period.
Y ear Ended December 31,
Nine Months Ended
September 30,
2021 2022 2023 2023 2024
(RMB’000)
(unaudited)
Revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,782,624 6,266,787 7,220,952 5,062,293 6,222,831
Cost of sales /H1118/H1118/H1118/H1118/H1118/H1118/H1118(2,525,121) (4,471,868) (4,868,078) (3,521,863) (3,600,815)
Gross profit /H1118/H1118/H1118/H1118/H1118/H1118/H11181,257,503 1,794,919 2,352,874 1,540,430 2,622,016
Profit before tax /H1118/H1118/H1118770,375 822,012 1,206,795 758,254 1,848,035
Profit for the
year/period /H1118/H1118/H1118/H1118/H1118/H1118613,408 493,880 871,585 562,020 1,264,769
Attributable to:
Owners of the parent /H1118 581,949 450,976 804,471 526,655 1,115,256
Non-controlling
interests /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111831,459 42,904 67,114 35,365 149,513
Profit for the
year/period /H1118/H1118/H1118/H1118/H1118/H1118613,408 493,880 871,585 562,020 1,264,769
Our net profit decreased from RMB613.4 million in December 31, 2021 to RMB493.9
million in December 31, 2022, primarily due to the acquisition of GSWL. The acquisition led
to increased financial and administrative expenses, and incurred higher tax rates overseas,
resulting in a decrease in net profit.
Our net profit increased from RMB493.9 million in December 31, 2022 to RMB871.6
million in December 31, 2023, primarily due to the year-on-year increase in both the volume
and the selling price of gold.
Our net profit increased from RMB562.0 million in September 30, 2023 to RMB1,264.8
million in September 30, 2024, primarily due to the increase in gold sales volume and the
average selling price compared to the same period of 2024.
SUMMARY
–3 4–


--- page 46 ---
Cost of Sales
Our cost of sales primarily comprises materials expense, labor expense, electricity fees,
depreciation and amortization, and others. The fluctuations of our cost of sales are in line with
the decreases and increases in our revenue during the Track Record Period.
For the years ended December 31, 2021, 2022 and 2023 and the nine months ended
September 30, 2023 and 2024, our cost of sales amounted to RMB2,525.1 million,
RMB4,471.9 million, RMB4,868.1 million, RMB3,521.9 million and RMB3,600.8 million,
respectively.
The following table sets forth a breakdown of our cost of sales by nature for the periods
indicated:
Y ear Ended December 31, Nine Months Ended September 30,
2021 2022 2023 2023 2024
RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 %
(unaudited)
Materials
expense /H1118/H1118/H1118/H1118998,240 39.5 2,122,635 47.5 2,006,000 41.2 1,496,272 42.5 1,461,452 40.6
Labor expense /H1118/H1118398,270 15.8 611,157 13.7 690,984 14.2 473,389 13.4 624,265 17.3
Electricity fees /H1118/H1118151,639 6.0 225,787 5.0 352,709 7.2 215,123 6.1 247,340 6.9
Depreciation and
amortization /H1118/H1118411,005 16.3 1,033,836 23.1 1,322,323 27.2 979,508 27.8 902,241 25.1
Others 1 /H1118/H1118/H1118/H1118/H1118/H1118565,967 22.4 478,453 10.7 496,062 10.2 357,571 10.2 365,517 10.1
Total /H1118/H1118/H1118/H1118/H1118/H1118/H11182,525,121 100.0 4,471,868 100.0 4,868,078 100.0 3,521,863 100.0 3,600,815 100.0
Note:
1. “Others” primarily includes contractor expenses, construction expenses, service expenses, safety measure
expenses and repair expenses.
For the breakdown of our cost of sales by business segment and the breakdown of our cost
of sales by origin of our products during the Track Record Period, please refer to “Financial
Information — Description of Key Statement of Profit or Loss Items — Cost of Sales.”
SUMMARY
–3 5–


--- page 47 ---
Gross Profit and Gross Profit Margin
Our gross profit consists of revenue less cost of sales. Gross profit margin represents
gross profit divided by total revenue, expressed as a percentage. For the years ended December
31, 2021, 2022 and 2023 and the nine months ended September 30, 2023 and 2024, our gross
profit amounted to RMB1,257.5 million, RMB1,794.9 million, RMB2,352.9 million,
RMB1,540.4 million and RMB2,622.0 million, respectively. The following table sets forth a
breakdown of our gross profit and gross profit margin by business nature for the periods
indicated:
Y ear Ended December 31, Nine Months Ended September 30,
2021 2022 2023 2023 2024
Gross
Profit
Gross
Profit
Margin
Gross
Profit
Gross
Profit
Margin
Gross
Profit
Gross
Profit
Margin
Gross
Profit
Gross
Profit
Margin
Gross
Profit
Gross
Profit
Margin
RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 %
(unaudited)
Gold mining /H1118/H1118868,698 29.3 1,465,806 27.6 2,256,664 35.7 1,482,144 33.2 2,508,183 45.1
Other Mineral
Resources /H1118 335,811 60.9 279,377 43.0 64,911 13.1 27,259 8.1 91,720 20.2
Others /H1118/H1118/H1118/H1118/H111852,994 20.2 49,736 15.9 31,299 7.8 31,027 12.1 22,113 10.7
Total /H1118/H1118/H1118/H1118/H1118/H11181,257,503 33.2 1,794,919 28.6 2,352,874 32.6 1,540,430 30.4 2,622,016 42.1
The following table sets forth a breakdown of our gross profit and gross profit margin by
origin of our products for the periods indicated:
Y ear Ended December 31, Nine Months Ended September 30,
2021 2022 2023 2023 2024
Gross
Profit
Gross
Profit
Margin
Gross
Profit
Gross
Profit
Margin
Gross
Profit
Gross
Profit
Margin
Gross
Profit
Gross
Profit
Margin
Gross
Profit
Gross
Profit
Margin
RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 %
(unaudited)
PRC /H1118/H1118/H1118/H1118/H1118/H1118591,738 47.0 668,660 45.3 1,031,907 50.9 711,633 54.7 1,042,153 58.1
Laos /H1118/H1118/H1118/H1118/H1118/H1118665,765 26.4 552,686 18.4 670,960 22.0 404,807 18.1 741,141 31.8
Ghana 1 /H1118/H1118/H1118/H1118/H1118– – 573,573 32.0 650,007 30.4 423,990 27.9 838,722 39.9
Total /H1118/H1118/H1118/H1118/H1118/H11181,257,503 33.2 1,794,919 28.6 2,352,874 32.6 1,540,430 30.4 2,622,016 42.1
Note:
1. Our gross profit in Ghana was generated from Golden Star Resources. In January 2022, we acquired a 62%
equity interest in Golden Star Resources, which in turn indirectly holds a 90% equity interest in GSWL, and
we began consolidating the accounts of Golden Star Resources from February 1, 2022. As such, the gross profit
of GSWL prior to February 1, 2022 was not included in our Group. For more details, please see “— Key
Factors Affecting Our Results of Operations — Acquisitions — Acquisition of Golden Star Resources”.
SUMMARY
–3 6–


--- page 48 ---
Summary of Consolidated Statements of Financial Position
The following table sets forth a summary of our consolidated statements of financial
position as of the dates indicated.
As of December 31, As of
September 30,
20242021 2022 2023
(RMB’000)
Total non-current asset /H1118/H1118/H1118/H11184,295,439 13,434,829 13,822,413 13,570,188
Total current asset /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,758,167 4,109,465 4,895,380 6,324,980
Total asset /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,053,606 17,544,294 18,717,793 19,895,168
Total current liabilities /H1118/H1118/H1118/H11181,341,612 3,279,882 3,722,409 4,597,554
Net current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,416,555 829,583 1,172,971 1,727,426
Total assets less current
liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,711,994 14,264,412 14,995,384 15,297,614
Total non-current liabilities /H1118 1,710,963 6,856,109 6,453,176 5,497,716
Net assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,001,031 7,408,303 8,542,208 9,799,898
Non-controlling interests /H1118/H1118/H1118380,614 2,220,733 2,390,218 2,683,412
Our net assets increased from RMB5,001.0 million as of December 31, 2021 to
RMB7,408.3 million as of December 31, 2022, primarily due to (i) an increase in the total
comprehensive income of RMB1,053.3 million for the year, and (ii) an increase in minority
shareholders’ equity of RMB1,666.4 million following the acquisition of GSWL.
Our net assets increased from RMB7,408.3 million as of December 31, 2022 to
RMB8,542.2 million as of December 31, 2023, mainly due to an increase in the total
comprehensive income of RMB981.0 million for the year.
Our net assets increased from RMB8,542.2 million as of December 31, 2023 to
RMB9,799.9 million as of September 30, 2024, primarily due to (i) an increase in the total
comprehensive income of RMB1,173.5 million, (ii) an increase in the contribution from
non-controlling interests of RMB166.6 million, and (iii) payment of dividends of RMB82.4
million.
Our net current assets decreased significantly from RMB2,416.6 million as of December
31, 2021 to RMB829.6 million as of December 31, 2022. This was primarily due to: (i) a
decrease in cash and cash equivalents of RMB655.3 million resulting from the acquisition of
Golden Star Resources in 2022; (ii) an increase in other payables and accruals of RMB504.2
million mainly for construction projects and equipment; and (iii) an increase in short-term
loans of RMB488.4 million associated with the acquisition of Golden Star Resources and a
capacity expansion of the Jilong Gold Mine. The decrease was partially offset by an increase
in inventories resulting from our acquisition of Golden Star Resources and raw materials for
the Sepon Gold and Copper Mine’s expanded production.
SUMMARY
–3 7–


--- page 49 ---
Our net current assets increased from RMB829.6 million as of December 31, 2022 to
RMB1,173.0 million as of December 31, 2023. This was primarily due to: (i) an increase in
inventories of RMB242.3 million, mainly due to an increase in work in progress at the Sepon
Gold and Copper Mine; (ii) an increase in in cash and cash equivalents of RMB222.1 million
resulting from an increase in free cash flow from operations; and (iii) a decrease in trade and
notes payables of RMB298.9 million. The increase was partially offset by: (i) an increase in
financial liabilities at fair value through profit or loss of RMB319.7 million resulting from the
increase of gold leasing; and (ii) an increase in short-term loans of RMB361.6 million.
Our net current assets increased from RMB1,173.0 million as of December 31, 2023 to
RMB1,727.4 million as of September 30, 2024. This was primarily due to the increase in the
prepayments, receivables and other assets of RMB531.6 million.
Summary of Cash Flows Analysis
The following table sets forth a summary of our cash flows for the periods indicated.
Y ear Ended December 31,
Nine Months Ended
September 30,
2021 2022 2023 2023 2024
(RMB’000)
(unaudited)
Net cash flows from
operating activities /H1118/H1118/H1118/H1118/H1118/H1118755,149 1,090,133 2,203,080 1,205,363 2,043,988
Net cash flows from/(used
in) investing activities /H1118/H1118/H1118(277,873) (3,984,047) (1,771,119) (1,443,021) (677,127)
Net cash flows from/(used
in) financing activities /H1118/H1118/H111855,905 2,225,143 (228,120) 257,705 (554,463)
Net increase/(decrease) in
cash and cash equivalents /H1118 533,181 (668,771) 203,841 20,047 812,398
Cash and cash equivalents at
beginning of year/period /H1118/H11181,176,419 1,707,868 1,052,545 1,052,545 1,274,635
Effect of foreign exchange
rate changes, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,732) 13,448 18,249 12,708 7,108
Cash and cash equivalents
at the end of the
year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,707,868 1,052,545 1,274,635 1,085,300 2,094,141
SUMMARY
–3 8–


--- page 50 ---
For the nine months ended September 30, 2024, we recorded net cash inflow from
operating activities of RMB2,044.0 million. This was primarily due to our profit before tax of
RMB1,848.0 million, adjusted by non-cash and non-operating items, mainly comprising: (i)
depreciation of property, plant and equipment of RMB687.5 million; (ii) amortization of other
intangible assets of RMB226.0 million; and (iii) investment losses received from disposal of
financial liabilities held for trading of RMB107.4 million. This was partially offset by: (i) an
increase in inventories of RMB73.7 million; and (ii) a decrease in other payables and accruals
of RMB148.0 million.
In 2023, we recorded inflow from operating activities of RMB2,203.1 million. This was
primarily due to our profit before tax of RMB1,206.8 million, adjusted by non-cash and
non-operating items, mainly comprising: (i) depreciation of property, plant and equipment of
RMB910.8 million; (ii) amortization of other intangible assets of RMB552.4 million; and (iii)
increase in other payables and accruals of RMB160.9 million. This was partially offset by: (i)
decrease in trade and notes payables of RMB262.1 million; and (ii) an increase in inventories
of RMB143.8 million.
In 2022, we recorded inflow from operating activities of RMB1,090.1 million. This was
primarily due to our profit before tax of RMB822.0 million, adjusted by non-cash and
non-operating items, which primarily included (i) depreciation of property, plant and
equipment of RMB761.2 million; (ii) amortization of other intangible assets of RMB582.2
million; and (iii) decrease in trade and notes payables of RMB218.0 million. This was partially
offset by: (i) an increase in inventories of RMB329.0 million; and (ii) a decrease in other
payables and accruals of RMB300.2 million.
In 2021, we recorded net cash inflow from operating activities of RMB755.1 million. This
was primarily due to our profit before tax of RMB770.4 million, adjusted by non-cash and
non-operating items, mainly comprising: (i) depreciation of property, plant and equipment of
RMB455.7 million; (ii) amortization of other intangible assets of RMB315.9 million; and (iii)
increase in trade and notes payables of RMB143.4 million. This was partially offset by: (i) an
increase in inventories of RMB815.7 million; and (ii) an increase in prepayments, other
receivables and other assets of RMB66.0 million.
ACQUISITION OF GOLDEN STAR RESOURCES
In January 2022, we acquired 62% of the issued and outstanding common shares of
Golden Star Resources through Chijin HK, which in turn indirectly holds a 90% equity interest
in GSWL, and the remaining 38% equity interest in Golden Star Resources was acquired by the
China-Africa Fund for Industrial Cooperation Co., Ltd. (ப΂ʮ̡).
Pursuant to section 192 of the Canada Business Corporations Act, the consideration was set at
US$3.91 per share in cash, representing a total transaction value of approximately US$470
million on a fully-diluted, in-the-money basis. The aggregate consideration to be paid by our
Company (through Chijin HK) amounted to US$291 million, which was fully settled in January
2023. The acquisition was completed on January 31, 2022, upon which Golden Star Resources
became our non-wholly owned subsidiary. To finance the acquisition of Golden Star Resources,
SUMMARY
–3 9–


--- page 51 ---
we incurred long-term borrowings of in aggregate RMB1,104.0 million at an interest rate of
4.95% per annum. For more information, see “Business — Our Gold Production Business in
Ghana” and “Financial Information — Key Factors Affecting Our Results of Operations —
Acquisition — Acquisition of Golden Star Resources.”
According to Rule 4.05A of the Hong Kong Listing Rules, the acquisition of Golden Star
Resources would have been classified at the date of application for our Listing as a major
transaction under Chapter 14 of the Hong Kong Listing Rules. For further details of the
financial performance of Golden Star Resources, please refer to the history financial
information of Golden Star Resources set out in Appendix IB to this Prospectus.
KEY FINANCIAL RATIOS
The following table sets forth certain of our key financial ratios for the periods indicated.
Y ear Ended December 31,
Nine Months
Ended
September 30,
20242021 2022 2023
Rates of return
Return on assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187.6% 2.8% 4.7% 6.4%
Return on equity /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812.3% 6.7% 10.2% 12.9%
Liquidity ratios
Current ratio /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.8 1.3 1.3 1.4
Quick ratio /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.7 0.6 0.7 0.8
Gearing ratio /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.6% 35.1% 32.0% 24.2%
Notes:
1. Return on assets ratio is calculated using net profit divided by total assets at the end of the year,
multiplied by 100%.
2. Return on equity ratio is calculated using net profit divided by total equity at the end of the year,
multiplied by 100%.
3. Current ratio is calculated using total current assets divided by total current liabilities.
4. Quick ratio is calculated using total current assets less inventories divided by total current liabilities.
5. Gearing ratio is calculated by dividing total debt (which includes current and non-current bank loans,
lease liabilities and other borrowings) by total equity.
See “Financial Information — Key Financial Ratios” for details.
SUMMARY
–4 0–


--- page 52 ---
LISTING EXPENSE
Listing expenses represent professional fees, underwriting commissions and other fees
incurred in connection with the Global Offering. We expect to incur listing expenses of
approximately HK$151.7 million, representing approximately 5.0% of the gross proceeds from
the Global Offering (based on the mid-point of the indicative Offer Price range and assuming
the Offer Size Adjustment Option and the Over-allotment Option are not exercised). The listing
expenses we incurred in the Track Record Period and expect to incur would consist of
approximately HK$91.2 million underwriting-related fees and approximately HK$60.6 million
non-underwriting-related fees (including fees and expenses of legal advisors and the reporting
accountant of approximately HK$28.4 million and other fees and expenses of approximately
HK$32.2 million). Among the total listing expenses which we expect to incur, approximately
HK$134.6 million will be directly attributable to the issue of our Shares and deducted from
equity, and the remaining HK$17.1 million will be expensed upon Listing. Our Directors do not
expect such expenses to materially impact our results of operations in 2024. See “Financial
Information — Listing Expense” for details.
PROFIT ESTIMATE FOR THE YEAR ENDED DECEMBER 31, 2024
On the basis set out in Appendix IIB to this prospectus, and in the absence of unforeseen
circumstances, we estimate our consolidated profit attributable to owners of our Company for
the year ended December 31, 2024 to be not less than RMB1,730.0 million (equivalent to
approximately HK$1,879.2 million). For details about our consolidated profit attributable to
owners of our Company for the year ended December 31, 2024, see “Appendix IIB — Profit
Estimate.”
RECENT DEVELOPMENT AND NO MATERIAL ADVERSE CHANGE
As of the Latest Practicable Date, in connection with our proposed acquisition of 90%
equity interest in China Investment Mining (Laos) Sole Co., Ltd. (the “ Target Company ”), we
have obtained the approval from the Xiamen Development and Reform Commission, and the
parties to the transactions were proceeding with the fulfillment of the other conditions of the
transaction including changes of the authorized representatives of the Target Company and its
subsidiaries (collectively the “ Target Group ”). See “History, Development and Corporate
Structure — Post-Track Record Period Acquisition”.
The Phase I Construction Project of the lower mining zone of the Hanfeng Polymetallic
Mine was completed in December 2024. It has passed production safety assessment and
obtained a production safety permit. The project officially commenced operation on December
30, 2024. It is expected to increase our production volume of copper, lead, and zinc by 435,000
tonnes.
SUMMARY
–4 1–


--- page 53 ---
Additionally, the expansion of the scope of mining right (deep-zone) for the Aohan
County Zhuanshanzi Gold Mine of Jilong Gold Mine was approved in November 2024. The
verification report for additional resources in this area has also been filed with the relevant
authority in November 2024. This is expected to enhance our production capacity and
utilization rate.
Since September 30, 2024 and up to the Latest Practicable Date, we had continued to
receive new purchase orders for our products.
After due and careful consideration, our Directors confirm that, up to the date of this
document, there has been no material adverse change in our financial and trading position or
prospects since September 30, 2024.
GLOBAL OFFERING STATISTICS
All statistics in the following table are based on the assumptions that: (i) the Global
Offering has been completed and 205,652,000 new H Shares are issued pursuant to the Global
Offering; and (ii) the Offer Size Adjustment Option and the Over-allotment Option are not
exercised, and our Company will have 1,869,563,378 issued Shares upon completion of the
Global Offering:
Based on an
Offer Price of
HK$13.72
Based on an
Offer Price of
HK$15.83
Market capitalization of our Shares 1, 2 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
HK$38,435
million
HK$38,869
million
Unaudited pro forma adjusted consolidated
net tangible assets per Share 3 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118HK$2.03 HK$2.26
Notes:
1 The estimated market value of our Company is the aggregate of (i) the estimated market capitalisation
of the H Shares upon listing and (ii) the market capitalisation of our Company’s A Shares listed on the
Shanghai Stock Exchange. For the latest five trading days preceding the Latest Practicable Date, the
average closing price of our Company’s A Shares was RMB19.74 each and the market capitalisation of
our Company’s A Shares was HKD35,613,225,199 (approximately RMB32,838,954,956 based on the
exchange rate of RMB0.9221: HKD1.0000).
2 The estimated market capitalisation of the H Shares upon listing is based on the assumptions that: (i)
the Global Offering has been completed and 205,652,000 new H Shares are issued pursuant to the
Global Offering; and (ii) the Offer Size Adjustment Option and the Over-allotment Option are not
exercised. Based on the offer price range from HKD13.72 to HKD15.83, the estimated market
capitalisation of our Company’s H Shares should be from HKD2,821,545,440 to HKD3,255,471,160,
and market capitalization of our Shares should therefore be from HKD38,434,770,639 to
HKD38,868,696,359.
3 The unaudited pro forma adjusted net tangible asset per Share as at September 30, 2024 is calculated
after making the adjustments referred to in “Appendix IIA — Unaudited Pro Forma Financial
Information”.
SUMMARY
–4 2–


--- page 54 ---
FUTURE PLANS AND USE OF PROCEEDS
The aggregate net proceeds from the Global Offering, after deducting underwriting fees
and other estimated expenses in connection with the Global Offering, assuming that the Offer
Size Adjustment Option and the Over-allotment Option are not exercised and an Offer Price of
HK$14.78 per Offer Share (being the mid-point of the indicative Offer Price range of
HK$13.72 to HK$15.83 per Offer Share) will be approximately HK$2,887 million, which will
be applied as follows:
Use of Net Proceeds from the Global Offering
Amount of Net
Proceeds from the
Global Offering
Percentage of Net
Proceeds from the
Global Offering
HK$ million %
Upgrade and exploration of existing mines /H1118/H1118/H1118/H1118/H1118/H11181,443 50
Potential acquisition /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,155 40
General corporate purposes /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118289 10
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,887 100
Please see “Future plans and use of proceeds” in this Prospectus for details.
DIVIDEND
We declared dividends to our Shareholders of nil, nil, RMB82.4 million and nil for the
three years ended December 31, 2021, 2022 and 2023 and the nine months ended
September 30, 2024, respectively.
Subject to our constitutional documents and the Company Law, we have adopted a general
annual dividend policy, according to which we may declare dividend by way of cash dividends,
stock dividends, or a combination of cash and stock dividends. We prioritize cash dividends.
Other than under certain special circumstances, the accumulated profit distributed in cash in
any three consecutive years shall not be less than 30% of the annual distributable profit
realized in the same three years. The abovementioned special circumstances include: (i) our
Company’s net cash flow from operating activities in the year of the consolidated statement of
accounts is negative; and (ii) the single amount of investment projects such as proposed
internal investment, external investment or assets acquisition in the current year or within the
next twelve months reaches or exceeds 10% of our Company’s latest audited net assets.
According to a Board resolution dated March 29, 2024 and a Shareholder resolution dated
April 19, 2024, with a total share capital of 1,663,911,378 shares at the end of 2023, after
deducting the 15,182,600 shares held in our dedicated securities account for repurchases, the
base for profit distribution was 1,648,728,778 shares. A cash dividend of RMB0.50 per 10
shares (including tax) was paid to all shareholders, totalling RMB82,436,438.90.
SUMMARY
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There is no guarantee, representation or indication that our Directors must or will
recommend and that we must or will declare and pay dividends at all. The dividend distribution
record in the past may not be used as a reference or basis to determine the level of dividends
that may be declared or paid by us in the future.
OUR SINGLE LARGEST SHAREHOLDER GROUP
As of the Latest Practicable Date, Ms. Li and Hanfeng Zhongxing directly held
190,410,595 and 51,515,151 A Shares, accounting for approximately 11.44% and 3.10% of the
issued share capital of our Company, respectively. Meanwhile, Ms. Li is the sole limited
partner of Hanfeng Zhongxing accounting for approximately 99.00% of the committed capital
contribution of Hanfeng Zhongxing. Accordingly, pursuant to the Hong Kong Listing Rules
and Chapter 1.1C of the Guide published by the Hong Kong Stock Exchange, Ms. Li and
Hanfeng Zhongxing are collectively regarded as the Single Largest Shareholder Group of our
Company.
Accordingly, the Single Largest Shareholder Group was entitled to exercise voting rights
attached to the 241,925,746 A Shares, representing approximately 14.54% of the total issued
share capital of our Company as of the Latest Practicable Date. Immediately following the
completion of the Global Offering, the Single Largest Shareholder Group will be interested in
approximately 12.94% of our total share capital (assuming the Offer Size Adjustment Option
and the Over-allotment Option are not exercised) or approximately 12.50% of our total share
capital (assuming the Offer Size Adjustment Option and the Over-allotment Option are
exercised in full).
RISK FACTORS
Our business faces risks including those set out in the section headed “Risk Factors.” As
different investors may have different interpretations and criteria when determining the
significance of a risk, you should read the section headed “Risk Factors” in its entirety before
you decide to invest in our Offer Shares. Some of the major risks that we face include:
 Changes in the market price for gold mining and other Mineral Resources, which in
the past have experienced significant volatility, affect the profitability of our
operations and the cash flows generated by those operations.
 Our business is subject to a number of operational risks and hazards specific to
mining industry, which may result in increased costs or losses, personal injuries or
casualties, damage to reputation, suspension of operation and other penalties.
 We may not be able to expand or replenish our Mineral Resources and Reserves
through exploration.
 We may be subject to risks relating to operating our overseas business.
SUMMARY
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 We may fail to obtain, maintain or renew the government permits, licenses and
approvals required for our mining and exploration activities.
 Artisanal mining, gold theft and robbery may occur on some of our properties. These
activities are difficult to control and can disrupt our business and expose us to
liability.
For further information and other risks that we face, please see “Risk Factors” in this
Prospectus. Past performance is no guarantee of future results.
SUMMARY
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In this Prospectus, unless the context otherwise requires, the following terms shall
have the meanings set out below. Certain technical terms are explained in the section
headed “Glossary of Technical Terms” in this Prospectus.
“2022-2024 Property Lease
Agreement”
the property lease agreement entered into between
Beijing Eagleleap and our Company on January 1, 2022
in relation to the lease of the Leased Premises for a term
of three years from January 1, 2022 to December 31,
2024, details of which are set out in the section headed
“Connected Transactions — One-off Connected
Transactions — Property Lease Agreements” in this
Prospectus
“2025-2026 Property Lease
Agreement”
the property lease agreement entered into between
Beijing Eagleleap and our Company on August 20, 2024
in relation to the lease of the Leased Premises for a term
of two years from January 1, 2025 to December 31, 2026,
details of which are set out in the section headed
“Connected Transactions — One-off Connected
Transactions — Property Lease Agreements” in this
Prospectus
“A Share(s)” ordinary share(s) in the share capital of our Company
with nominal value of RMB1.00 each, which are traded in
Renminbi and listed on the SSE
“Accountants’ Report” the accountants’ report set out in Appendix IA to this
Prospectus
“affiliate” any other person, directly or indirectly, controlling or
controlled by or under direct or indirect common control
with such specified person
“AFRC” Accounting and Financial Reporting Council
“Articles” or “Articles of
Association”
the articles of association of our Company, as
conditionally adopted on August 23, 2024, which shall
become effective upon Listing (as amended,
supplemented or otherwise modified from time to time),
a summary of which is set out in Appendix VI to this
Prospectus
DEFINITIONS
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“associate(s)” has the meaning ascribed to it under the Hong Kong
Listing Rules
“AUD” or “Australian dollars” the lawful currency of Australia
“Audit Committee” audit committee of the Board
“Beijing Eagleleap” Beijing Eagleleap Technology Co., Ltd. (߅
ʮ̡), a private limited liability company
established under the PRC laws and is held as to 99% and
1% of its equity interest by Hanfeng United and Lv
Xiaoming ( ѐወთ), an Independent Third Party
“Benso Gold Mine” a gold mine operated by GSWL in Ghana
“Board” or “Board of Directors” the board of directors of our Company
“Board Diversity Policy” the board diversity policy of our Company
“Business Day” a day which banks in Hong Kong are generally open for
normal business to the public and which is not a Saturday,
Sunday or public holiday in Hong Kong
“CAGR” compound annual growth rate
“Capital Market Intermediaries” the capital market intermediaries participating in the
Global Offering, which includes the Overall
Coordinators, Joint Global Coordinators, Joint
Bookrunners, Joint Lead Managers and Hong Kong
Underwriters as named in the section headed “Directors,
Supervisors and Parties Involved in the Global Offering”
“Caystar Finance” Caystar Finance Co., which is registered in the Cayman
Islands and is an indirect wholly owned subsidiary of
Golden Star Resources
“CCASS” the Central Clearing and Settlement System established
and operated by HKSCC
“Cedi”, “GH
₵”o r
“Ghanaian Cedi”
the lawful currency of Ghana
“Chairman Wang” Mr. Wang Jianhua, the Chairman of the Board and an
Executive Director of our Group
DEFINITIONS
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“Chenzhou Xiongfeng” Chenzhou Xiongfeng Environment Protection
Technology Co., Ltd. (ʮ̡), a
former wholly owned subsidiary of our Company. Our
Company disposed of the entire equity interests in it in
2020
“Chijin Fengyu” Shanghai Chijin Fengyu Industrial Co., Ltd (ᔮ
ʮ̡), a private limited liability company
established under the PRC laws and a direct wholly
owned subsidiary of our Company
“Chijin Geoexploration” Chijin (Tianjin) Geoexploration Technology Co., Ltd ( ԏ
ږ(ݵ)ʮ̡), a limited liability
company established under the PRC laws and a direct
non-wholly owned subsidiary of our Company holding
60% of its equity interest prior to the completion of its
voluntary deregistration on January 3, 2025. See the
section headed “History, Development and Corporate
Structure — Deregistration of a Subsidiary” for details
“Chijin HK” Chijin International (HK) Limited (਷ყ(ಥ)ࠢ
ʮ̡), a company incorporated in Hong Kong with
limited liability and a direct wholly owned subsidiary of
our Company
“Chijin Laos” CHIJIN Laos Holdings Limited, a company registered in
the Cayman Islands with limited liability and a direct
wholly owned subsidiary of our Company
“Chijin Xiawu” Xiamen Chijin Xiawu Metal Resources Limited (ԏ
ʮ̡), previously known as
Shanghai Chijin Xiawu Metal Resources Limited ( ɪऎԏ
ʮ̡), a private limited liability
company established under the PRC laws and a direct
non-wholly owned subsidiary of our Company
“China” or “PRC” the People’s Republic of China, and solely for the
purpose of this Prospectus and by reference to region,
excluding Taiwan, the Macao Special Administrative
Region and Hong Kong Special Administrative Region
“Chixia Laos” CHIXIA Laos Holdings Limited (ʮ
̡), a company registered in the Cayman Islands with
limited liability and wholly owned by Chijin Xiawu
DEFINITIONS
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“CIRE Mining” China Investment Rare Earth Mining Co., Ltd, a company
registered in Laos with limited liability, a subsidiary of
China Investment Mining (Laos) Sole Co., Ltd. as of the
Latest Practicable Date (see the section headed “History,
Development and Corporate Structure — Post-Track
Record Period Acquisition” in this Prospectus for
details), and the operator of the trial mining area of the
Mengkham Rare Earth Element Project
“CIREX Mining” China Investment Rare Earth Mining Xiangkhouang Co.
Ltd, a company registered in Laos with limited liability
and a subsidiary of China Investment Mining (Laos) Sole
Co., Ltd. as of the Latest Practicable Date (see the section
headed “History, Development and Corporate Structure
— Post-Track Record Period Acquisition” in this
Prospectus for details), and the operator of the
exploration area of the Mengkham Rare Earth Element
Project
“close associate(s)” has the meaning ascribed to it under the Hong Kong
Listing Rules
“Companies (Winding Up and
Miscellaneous Provisions)
Ordinance”
the Companies (Winding Up and Miscellaneous
Provisions) Ordinance (Chapter 32 of the Laws of Hong
Kong), as amended, supplemented or otherwise modified
from time to time
“Companies Ordinance” the Companies Ordinance (Chapter 622 of the Laws of
Hong Kong), as amended, supplemented or otherwise
modified from time to time
“Company” or “our Company” Chifeng Jilong Gold Mining Co., Ltd. (ᘤ
ʮ̡), a joint stock company incorporated
under the laws of the PRC with limited liability on June
22, 1998
“Company Law” or “PRC
Company Law”
the Company Law of the People’s Republic of China ( ʕ
جas amended, supplemented or
otherwise modified from time to time
“Competent Person” or “SRK” has the same meaning ascribed to it under Rule 18.01 of
the Hong Kong Listing Rules and, in the context of this
prospectus, means SRK Consulting (China) Ltd., an
independent mining and geological consultant, which is
an Independent Third Party
DEFINITIONS
–4 9–


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“Competent Person’s Reports” or
“SRK Reports”
the Competent Person’s reports prepared by SRK on the
PRC Gold Mines, the Sepon Gold and Copper Mine, the
Wassa Gold Mine and the Sepon Rare Earth Element and
Mengkham Rare Earth Element Projects, the effective
date of which is September 30, 2024 and details of which
are set out in Appendices IIIA to IIID to this Prospectus
“connected person(s)” has the meaning ascribed to it under the Hong Kong
Listing Rules
“connected transaction(s)” has the meaning ascribed to it under the Hong Kong
Listing Rules
“core connected person(s)” has the meaning ascribed to it under the Hong Kong
Listing Rules
“Corporate Governance Code” the Corporate Governance Code set out in Appendix C1
to the Hong Kong Listing Rules
“CSDC” China Securities Depository and Clearing Corporation
Limited (ப΂ʮ̡)
“CSRC” the China Securities Regulatory Commission ( ʕ਷ᗇՎ
ึ)
“Designated Bank” HKSCC Participant’s EIPO Designated Bank
“Director(s)” director(s) of our Company
“Dongfeng Molybdenum Mine” a molybdenum mine operated by Hanfeng Mining in PRC
“EIT” the PRC enterprise income tax
“EIT Law” the Enterprise Income Tax Law of the PRC ( ʕശɛ͏΍
ج)
ESG” environmental, social, and corporate governance
“ESOPs” the Phase I ESOP , the Phase II ESOP and the Phase III
ESOP , collectively
DEFINITIONS
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“Exchange Participant(s)” a person (a) who, in accordance with the Hong Kong
Listing Rules, may trade on or through the Hong Kong
Stock Exchange; and (b) whose name is entered in a list,
register or roll kept by the Hong Kong Stock Exchange as
a person who may trade on or through the Hong Kong
Stock Exchange
“Extreme Conditions” the occurrence of “extreme conditions” as announced by
any government authority of Hong Kong due to serious
disruption of public transport services, extensive
flooding, major landslides, large-scale power outage or
any other adverse conditions before Typhoon Signal No.
8 or above is replaced with Typhoon Signal No. 3 or
below
“Father Brown Mine” one of the mines within GSWL’s portfolio of mines. The
Father Brown Mine is independent of the Wassa Mine, as
it is within the Hwini-Butre mining lease (a concession
south of Wassa)
“FINI” “Fast Interface for New Issuance,” an online platform
operated by HKSCC that is mandatory for admission to
trading and, where applicable, the collection and
processing of specified information on subscription in
and settlement for all new issues
“Frost & Sullivan” Frost & Sullivan (Beijing) Inc., Shanghai Branch Co., an
independent industry consultant commissioned by us to
prepare the Frost & Sullivan Report
“Frost & Sullivan Report” an independent market research report commissioned by
our Company and prepared by Frost & Sullivan
“FVOCI” fair value through Other Comprehensive Income (OCI)
investment
“GDP” gross domestic product
“General Rules of HKSCC” the General Rules of HKSCC as may be amended or
modified from time to time and where the context so
permits, shall include the HKSCC Operational
Procedures
“Ghana” the Republic of Ghana
DEFINITIONS
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“Ghana Legal Advisor” REM Law Consultancy, our legal advisor as to Ghana
laws
“Global Offering” the Hong Kong Public Offering and the International
Offering
“Group”, “our Group,” “we”
or “us”
our Company and its subsidiaries (or our Company and
any one or more of its subsidiaries, as the context may
require)
“GSR” or “Golden Star
Resources”
Golden Star Resources Ltd., a company registered in
Canada and an indirect non-wholly owned subsidiary of
our Company
“GSWL” Golden Star (Wassa) Ltd, a company registered in Ghana
and an indirect non-wholly owned subsidiary of Golden
Star Resources
“Guangyuan Technology” Anhui Guangyuan Technology Development Co., Ltd.
(ʮ̡), a private limited liability
company established under the PRC laws and a direct
non-wholly subsidiary of our Company
“Guide” the Guide for New Listing Applicants issued by the Hong
Kong Stock Exchange (as amended, supplemented or
otherwise modified from time to time)
“H Share(s)” overseas listed foreign shares in the share capital of our
Company with nominal value of RMB1.00 each, which
are to be subscribed for and traded in HK dollars and are
to be listed on the Hong Kong Stock Exchange
“H Share Registrar” Computershare Hong Kong Investor Services Limited
“Hanfeng Mining” Jilin Hanfeng Mining Technology Co., Ltd. (ᖍᔮᘤ
ʮ̡), a private limited liability company
established under the PRC laws and a direct wholly
owned subsidiary of our Company
“Hanfeng Polymetallic Mine” a polymetallic mine operated by Hanfeng Mining in PRC
“Hanfeng United” Beijing Hanfeng United Technology Co., Ltd. ( ̏ԯᖍᔮ
ʮ̡), which is directly wholly owned by
Ms. Li
DEFINITIONS
–5 2–


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“Hanfeng Zhongxing” Y antai Hanfeng Zhongxing Management Consultancy
Center (Limited Partnership) ( ๧̨ᖍᔮʕጳ၍ଣፔ༔ʕ
ː(Υྫ)), a limited liability partnership established
under the PRC laws, the sole limited partner of which is
Ms. Li, accounting for approximately 99.00% of its
committed capital contribution, and the sole general
partner of which is Wu Zengxiang (ᄣୂ), accounting
for approximately 1.00% of its committed capital
contribution
“High and New Technology
Enterprise”
an enterprise certified by the Chinese government
through the Ministry of Science and Technology (MOST)
for businesses
“HK$”, “Hong Kong dollars”,
“HK dollars” or “cents”
Hong Kong dollars and cents, respectively, and being the
lawful currency of Hong Kong
“HKSCC” Hong Kong Securities Clearing Company Limited, a
wholly owned subsidiary of Hong Kong Exchanges and
Clearing Limited
“HKSCC EIPO” the application for the Hong Kong Offer Shares to be
issued in the name of HKSCC Nominees and deposited
directly into CCASS to be credited to your designated
HKSCC Participant’s stock account through causing
HKSCC Nominees to apply on your behalf, including by
instructing your broker or custodian who is an HKSCC
Participant to give electronic application instructions
via HKSCC’s FINI system to apply for the Hong Kong
Offer Shares on your behalf
“HKSCC Nominees” HKSCC Nominees Limited, a wholly owned subsidiary
of HKSCC
“HKSCC Operational
Procedures”
the operational procedures of HKSCC, containing the
practices, procedures and administrative or other
requirements relating to HKSCC’s services and the
operations and functions of CCASS, FINI or any other
platform, facility or system established, operated and/or
otherwise provided by or through HKSCC, as from time
to time in force
DEFINITIONS
–5 3–


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“HKSCC Participant” a participant admitted to participate in CCASS as a direct
clearing participant, a general clearing participant or a
custodian participant
“Hong Kong” the Hong Kong Special Administrative Region of the
PRC
“Hong Kong Listing Rules” or
“Listing Rules”
the Rules Governing the Listing of Securities on The
Stock Exchange of Hong Kong Limited, as amended,
supplemented or otherwise modified from time to time
“Hong Kong Offer Shares” the 20,565,200 H Shares being initially offered for
subscription in the Hong Kong Public Offering (subject
to reallocation and the Offer Size Adjustment Option as
described in the section headed “Structure of the Global
Offering” in this Prospectus)
“Hong Kong Public Offering” the offer of the Hong Kong Offer Shares for subscription
by the public in Hong Kong at the Offer Price (plus
brokerage of 1%, SFC transaction levy of 0.0027%,
AFRC transaction levy of 0.00015% and Hong Kong
Stock Exchange trading fee of 0.00565%) on the terms
and subject to the conditions described in this document,
as further described in the section headed “Structure of
the Global Offering — The Hong Kong Public Offering”
in this Prospectus
“Hong Kong Stock Exchange”
or “Stock Exchange”
The Stock Exchange of Hong Kong Limited, a wholly
owned subsidiary of Hong Kong Exchanges and Clearing
Limited
“Hong Kong Underwriter(s)” the underwriters of the Hong Kong Public Offering as
listed in the section headed “Underwriting — Hong Kong
Underwriters” in this Prospectus
“Hong Kong Underwriting
Agreement”
the underwriting agreement, dated February 27, 2025,
relating to the Hong Kong Public Offering, entered into
by, among others, the Overall Coordinators, the Hong
Kong Underwriters and our Company
“Huatai Gold Mine” a gold mine operated by Huatai Mining in PRC
“Huatai Mining” Chifeng Huatai Mining Co., Ltd. (ப΂
ʮ̡), which is registered in the PRC and is a wholly
owned subsidiary of Jilong Mining
DEFINITIONS
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“IFRS” the International Financial Reporting Standards, which
include standards, amendments and interpretations
promulgated by the International Accounting Standards
Board (IASB) and the International Accounting
Standards (IAS) and interpretation issued by the
International Accounting Standards Committee (IASC)
“Independent Third Party(ies)” any entity(ies) or person(s) which, to the best of our
Directors’ knowledge, information and belief having
made reasonable enquiries, is not a connected person of
our Company within the meaning ascribed to it under the
Hong Kong Listing Rules
“International Offer Shares” the 185,086,800 H Shares being initially offered for
subscription under the International Offering together,
where relevant, with any additional H Shares that may be
issued pursuant to any exercise of the Offer Size
Adjustment Option and/or the Over-allotment Option
(subject to reallocation as described in the section headed
“Structure of the Global Offering” in this Prospectus)
“International Offering” the conditional placing of the International Offer Shares
at the Offer Price outside the United States in offshore
transactions in accordance with Regulation S, in each
case on and subject to the terms and conditions described
in the section headed “Structure of the Global Offering”
in this prospectus
“International Underwriter(s)” the underwriters expected to enter into the International
Underwriting Agreement relating to the International
Offering
“International Underwriting
Agreement”
the international underwriting agreement, expected to be
entered into on or about March 6, 2025, relating to the
International Offering, by, among others, our Company,
the Overall Coordinators and the International
Underwriters in respect of the International Offering, as
further described in the section headed “Underwriting —
International Offering” in this Prospectus
“Jilong Gold Mine” a gold mine operated by Jilong Mining in PRC
DEFINITIONS
–5 5–


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“Jintai Gold Mine” a gold mine operated by Jintai Mining in PRC
“Jilong Mining” Chifeng Jilong Mining Co., Ltd. (ப΂
ʮ̡), a private limited liability company established
under the PRC laws and a direct wholly owned subsidiary
of our Company
“Jintai Mining” Eryuan Jintai Mining Development Co., Ltd. (๕ᎀइ
ப΂ʮ̡), a private limited liability
company established under the PRC laws and a direct
non-wholly owned subsidiary of Xinhenghe Mining
“JORC Code” the 2012 Edition of the Australasian Code for Reporting
of Exploration Results, Mineral Resources and Ore
Reserves sets out the minimum standards,
recommendations and guidelines for public reporting.
The JORC Code is adopted by the Australasian Institute
of Mining and Metallurgy and the Australian Institute of
Geoscientists and endorsed by the Mineral Council of
Australia, as detailed under the section headed “Summary
of the JORC Code” of this Prospectus
“KIP” or “LAK” or “Lao Kip” the lawful currency of Laos
“Lao”, “Lao PDR” or “Laos” the Lao People’s Democratic Republic
“Laos Legal Advisor” ZICOLaw (Laos) Sole Co., Ltd., our legal advisor as to
Laos laws
“Latest Practicable Date” February 20, 2025, being the latest practicable date for
the purpose of ascertaining certain information in this
Prospectus prior to its publication
“Leased Premises” the office premises of our headquarters in the PRC
“Lianhuashan Gold Mine” a gold mine operated by Huatai Mining in PRC
“Listing” the listing of our H Shares on the Main Board of the Hong
Kong Stock Exchange
“Listing Committee” the Listing Committee of the Hong Kong Stock Exchange
DEFINITIONS
–5 6–


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“Listing Date” the date expected to be on or about Monday, March 10,
2025, on which dealings in our H Shares first commence
on the Hong Kong Stock Exchange
“LXML” Lane Xang Minerals Limited Company, a company
registered in Laos, an indirect non-wholly owned
subsidiary of our Company and is the operator of the
Sepon Gold and Copper Mine
“Main Board” the stock exchange (excluding the option market)
operated by the Hong Kong Stock Exchange, which is
independent from and operated in parallel with GEM of
the Hong Kong Stock Exchange
“MEE” Ministry of Ecology and Environment of the PRC
“Mengkham Rare Earth Element
Project” or “Mengkham REE
Project”
a rare earth mine operated by CIRE Mining in Laos
“Minerals and Mining Act” the Ghanaian Minerals and Mining Act, 2006 (Act 703)
“MOF” or “Ministry of Finance” Ministry of Finance of the PRC (௅)
“MOFCOM” Ministry of Commerce of the PRC ( ʕശɛ͏΍ձ਷ਠਕ
௅)
“Ms. Li” Ms. Li Jinyang (ජ), a member of the Single Largest
Shareholder Group. Ms. Li directly held approximately
11.44% of the shareholding interest in our Company as of
the Latest Practicable Date
“NDRC” the National Development and Reform Commission of
the PRC (ึ)
“NEEQ” the National Equities Exchange and Quotations Co., Ltd.( Ό
ப΂ʮ̡), a PRC over-
the-counter system for trading shares of public
companies
“Nomination Committee” the nomination committee of the Board
“NPC” the National People’s Congress of the People’s Republic
of China (ɽึ)
DEFINITIONS
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“Offer Price” the final offer price per Offer Share (exclusive of
brokerage of 1%, SFC transaction levy of 0.0027%,
AFRC transaction levy of 0.00015% and Hong Kong
Stock Exchange trading fee of 0.00565%), expressed in
Hong Kong dollars, at which Hong Kong Offer Shares are
to be subscribed for pursuant to the Hong Kong Public
Offering and International Offer Shares are to be offered
pursuant to the International Offering, to be determined
as described in the section headed “Structure of the
Global Offering — Pricing and Allocation”
“Offer Share(s)” the Hong Kong Offer Shares and the International Offer
Shares, together, where relevant, with any additional H
Shares which may be issued by our Company pursuant to
the exercise of the Offer Size Adjustment Option and/or
the Over-allotment Option
“Offer Size Adjustment Option” the option under the Hong Kong Underwriting
Agreement, exercisable by the Company prior to the
execution of the International Underwriting Agreement,
pursuant to which the Company may issue and allot up to
an aggregate of 30,847,800 additional H Shares at the
Offer Price, to cover additional market demand, if any, as
described in the section headed “Structure of the Global
Offering — Offer Size Adjustment Option”
“Over-allotment Option” the option expected to be granted by our Company to the
International Underwriters, exercisable by the Overall
Coordinators on behalf of the International Underwriters
for up to 30 days from the day following the last day for
the lodging of applications under the Hong Kong Public
Offering, to require our Company to allot and issue up to
30,847,800 additional H Shares (representing in
aggregate approximately 15% of the Offer Shares
initially being offered under the Global Offering
assuming the Offer Size Adjustment Option is not
exercised at all) or up to an aggregate of 35,474,800
additional H Shares (representing approximately 15% of
the total number of Offer Shares being offered under the
Global Offering assuming the Offer Size Adjustment
Option is exercised in full) at the Offer Price to the
International Underwriters to cover over-allocations in
the International Offering, if any, details of which are
described in “Structure of the Global Offering — Over-
Allotment Option”
DEFINITIONS
–5 8–


--- page 70 ---
“Overall Coordinators” the overall coordinators as named in the section headed
“Directors, Supervisors and Parties Involved in the
Global Offering”
“PBOC” People’s Bank of China ( ʕ਷ɛ͏ვБ), the central bank
of the PRC
“Phase I ESOP” the Phase I Employee Stock Ownership Plan adopted by
our Company on October 13, 2020 (as revised on May 26,
2021, September 30, 2022 and April 20, 2023), details of
which are set out in the paragraph headed “C. Further
Information about our Directors, Supervisors and
Substantial Shareholders — 4. Employee Stock
Ownership Plans” in Appendix VII to this Prospectus
“Phase II ESOP” the Phase II Employee Stock Ownership Plan adopted by
our Company on February 27, 2023 (as revised on March
20, 2023), details of which are set out in the paragraph
headed “C. Further Information about our Directors,
Supervisors and Substantial Shareholders — 4. Employee
Stock Ownership Plans” in Appendix VII to this
Prospectus
“Phase III ESOP” the Phase III Employee Stock Ownership Plan adopted by
our Company on January 15, 2025, details of which are
set out in the paragraph headed “C. Further Information
about our Directors, Supervisors and Substantial
Shareholders — 4. Employee Stock Ownership Plans” in
Appendix VII to this Prospectus
“PRC GAAP” Accounting Standard for Business Enterprises — Basic
Standard, and the specific accounting standards and other
relevant regulations issued by the MOF on February 15,
2006 and in subsequent periods
“PRC Gold Mine(s)” Wulong Gold Mine, Jilong Gold Mine, Jintai Gold Mine
and Huatai Gold Mine, individually or collectively
“PRC Government” the central government of the PRC and all government
subdivisions (including provincial, municipal and other
regional or local government entities) and
instrumentalities thereof or, where the context requires,
any of them
DEFINITIONS
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“PRC Legal Advisor” Tianyuan Law Firm LLP , our legal advisor as to PRC
laws
“PRC Mine(s)” PRC Gold Mine(s) and Hanfeng Polymetallic Mine,
collectively
“Price Determination Date” the date, expected to be on or before Thursday, March 6,
2025 (Hong Kong time), or such later time as the Overall
Coordinators and our Company may agree, but in any
event no later than 12:00 noon on Thursday, March 6,
2025 on which the Offer Price is determined for the
purposes of the Global Offering
“Property Lease Agreements” 2022-2024 Property Lease Agreement and 2025-2026
Property Lease Agreement, collectively
“Property Management Services
Agreement”
the property management services agreement entered into
between Beijing Eagleleap and our Company on August
20, 2024 in relation to the provision of Property
Management Services from Beijing Eagleleap to our
Company, details of which are set out in the section
headed “Connected Transactions — Fully Exempt
Continuing Connected Transactions — Property
Management Services Agreement” in this Prospectus
“Property Management Services” the property management services provided by Beijing
Eagleleap to our Company under the Property
Management Services Agreement, details of which are set
out in the section headed “Connected Transactions —
Fully Exempt Continuing Connected Transactions —
Property Management Services Agreement “in this
Prospectus
“Prospectus” this prospectus being issued in connection with the Hong
Kong Public Offering
“R&D” research and development
“Regulation S” Regulation S under the U.S. Securities Act
DEFINITIONS
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“Relevant Persons” our Company, the Sole Sponsor, the Sponsor Overall
Coordinators, the Overall Coordinators, the Joint Global
Coordinator, the Joint Bookrunner, the Joint Lead
Manager, the Capital Market Intermediaries, the
Underwriters, any of their respective directors, officers,
employees, partners, agents, advisors and any other
parties involved in the Global Offering
“Remuneration and
Appraisal Committee”
remuneration and appraisal committee of the Board
“Reporting Accountants” Ernst & Y oung
“RMB” or “Renminbi” the lawful currency of the PRC
“SAFE” the State Administration of Foreign Exchange of the PRC
(̮ි၍ଣ҅)
“SAMR” the State Administration of Market Regulation of the
PRC (̹ఙ္ຖ၍ଣᐼ҅)
“SCNPC” the Standing Committee of the National People’s
Congress of the PRC (ɽึ
ึ)
“Securities Law” or
“PRC Securities Law”
the Securities Law of the People’s Republic of China ( ʕ
جas amended, supplemented or
otherwise modified from time to time
“Sepon Gold and Copper Mine” a gold and copper mine operated and managed by LXML,
a subsidiary of our Company, which has rare earth
minerals potential
“Sepon Rare Earth Element
Project”
a rare earth project in Laos operated and managed by
LXML, a subsidiary of our Company
“SFC” the Securities and Futures Commission of Hong Kong
“SFO” or “Securities and Futures
Ordinance”
the Securities and Futures Ordinance (Chapter 571 of the
Laws of Hong Kong), as amended, supplemented or
otherwise modified from time to time
DEFINITIONS
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“Shanghai-Hong Kong Stock
Connect”
a securities trading and clearing links program developed
by the Hong Kong Stock Exchange, SSE, HKSCC and
CSDC for mutual market access between Hong Kong and
Shanghai
“Share(s)” ordinary share(s) in the share capital of our Company,
with a nominal value of RMB1.00 each, comprising our
A Shares and our H Shares
“Shareholder(s)” holder(s) of Share(s)
“Single Largest Shareholder
Group”
Ms. Li and Hanfeng Zhongxing collectively
“Joint Bookrunners”, “Joint
Global Coordinators”, “Joint
Lead Managers”
the joint bookrunners, the joint global coordinators and
the joint lead manager as named in the section headed
“Directors, Supervisors and Parties Involved in the
Global Offering”
“Sole Sponsor” CITIC Securities (Hong Kong) Limited
“Sponsor-Overall Coordinator” CLSA Limited
“spot price” The gold spot price represents the current purchase price
of a troy ounce of the precious metal for immediate
delivery
“SSE” the Shanghai Stock Exchange
“Stabilizing Manager” CLSA Limited
“State Council” State Council of the People’s Republic of China ( ʕശɛ
͏΍ձ਷਷ਕ৫)
“Strategy and
Sustainability Committee”
strategy and sustainability committee of the Board
“subsidiary(ies)” has the meaning ascribed to it under the Hong Kong
Listing Rules
“substantial shareholder(s)“ has the meaning ascribed to it under the Hong Kong
Listing Rules
“Supervisor(s)” member(s) of our Supervisory Committee
DEFINITIONS
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“Supervisory Committee” the supervisory committee of our Company
“Tietto Minerals” Tietto Minerals Limited, a company previously listed on
the Australian Securities Exchange under the stock code
TIE, which our Group acquired a total of approximately
13.05% of the then shareholding interest in by January
2023 and disposed of such shareholding interest in May
2024 through the offer from Zhaojin Mining Industry
Company Limited (a company listed on the Main Board
of the Stock Exchange, stock code: 1818) pursuant to a
bidder statement to acquire all its outstanding issues
shares, details of which are set out in the section headed
“History, Development and Corporate Structure — Major
Acquisitions and Disposals — 3. Acquisitions and
disposal of Tietto Minerals” in this Prospectus
“Track Record Period” the three financial years ended December 31, 2023 and
the nine months ended September 30, 2024
“U.S.” or “United States” the United States of America, its territories, its
possessions and all areas subject to its jurisdiction
“U.S. Securities Act” United States Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder
“Underlying Financial
Statements”
the consolidated financial statements of our Group
“Underwriter(s)” the Hong Kong Underwriter(s) and International
Underwriter(s)
“Underwriting Agreements” the Hong Kong Underwriting Agreement and the
International Underwriting Agreement
“US$” or “USD” or
“U.S. dollars”
the lawful currency of the United States
“Wassa Gold Mine” a gold mine operated by GSWL in Ghana
“White Form eIPO ” the application for Hong Kong Offer Shares to be issued
in the applicant’s own name, submitted online through
the designated website of the White Form eIPO Service
Provider at www.eipo.com.hk
DEFINITIONS
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“White Form eIPO Service
Provider”
Computershare Hong Kong Investor Services Limited
“Wulong Gold Mine” a gold mine operated by Wulong Mining in PRC
“Wulong Mining” Liaoning Wulong Gold Mining Co., Ltd. (ږ
ப΂ʮ̡), a private limited liability company
established under the PRC laws and a direct wholly
owned subsidiary of Jilong Mining
“Xiamen Tungsten” Xiamen Tungsten Co., Ltd. (ʮ̡), a
company listed on the SSE (stock code: 600549)
“Xinhenghe Mining” Kunming Xinhenghe Mining Co., Ltd. (ᘤุ
ʮ̡), a private limited liability company
established under the PRC laws and is a direct non-
wholly owned subsidiary of our Company
“%” per cent
In addition to the terms above, this Prospectus contains a glossary of certain technical
terms relating to our industry and business. See “Glossary of Technical Terms.”
The English names of the PRC entities, PRC laws and regulations, and the PRC
governmental authorities referred to in this Prospectus are translations from their Chinese
names and are for identification purposes only. If there is any inconsistency between the
Chinese original and the English translation, the Chinese names shall prevail.
DEFINITIONS
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This glossary contains explanations of certain technical terms used in this
Prospectus in connection with our Company and our business. Such terminology and
meanings may not correspond to standard industry meanings or usages of those terms.
“all-in sustaining costs” or
“AISC”
a metric which means operating costs excluding
amortisation and depreciation, plus all costs not included
therein relating to sustaining current production
including sustaining capital expenditure. It generally
comprises of cash costs (including by-product credits),
sustaining capital, exploration expenses and general and
administrative expenses
“all-slime cyanidation absorption
gold extraction method”
a method involves treating the entire ore slurry, including
fine particles or slimes, with cyanide to dissolve gold,
which is then absorbed onto activated carbon for
recovery
“annual mining capacity” the quantity of ore that a mining operation can extract
from the ground within a year
“annual processing capacity” the quantity of ore that a processing plant can handle and
process each year
“annual production capacity” the maximum annual production capacity within the
permitted annual production volume that can be achieved
by our Group in the usual and ordinary course of business
based on our existing resources and mine design
“Au” the chemical symbol for of gold
“beneficiation” a process that improves or benefits the economic value of
the ore by removing the gangue minerals, which results in
a higher grade product (ore concentrate) and a waste
stream (tailings)
“carbon-in-pulp gold extraction
process method”
means the carbon-in-pulp process integrates activated
carbon directly into the ore pulp, allowing dissolved gold
to adhere to the carbon particles, which are subsequently
separated and processed to extract the gold
“cathode” a negative electrode
“CCD” counter current decantation
GLOSSARY OF TECHNICAL TERMS
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“concentrate” or “gold
concentrate”
a powdery or wet product containing an upgraded mineral
content resulting from initial processing of mined ore to
remove some waste materials. A concentrate is an
intermediary product, which would still be subject to
further processing, such as smelting, to effect recovery of
metal
“crusher” a machine for crushing rocks to smaller grain size
“cut-and-fill” a method of stoping in which ore is removed in slices, or
lifts, with the excavation subsequently filled with rock or
other waste material (backfill), before the next slice is
extracted
“cut-off grade” the grade threshold above which a mineral material is
considered potentially economic and is selectively mined
and processed as ore
“deposit” natural occurrence of a useful mineral, or an ore,
sufficient in extent and degree of concentration to invite
exploitation
“designed mining capacity” the production capacity planned based on the mine’s
design, equipment, and technical parameters
“dilution” the reduction of grade for mined ore due to the inclusion
of waste material in the mined ore
“doré” unrefined gold bar produced at the mine site or other gold
sources before sending to a refinery where the gold is
refined or processed to meet specific requirements
“drilling” use of a machine to create holes for exploration or for
loading with explosives
“exploration” activity to prove the location, volume and quality of an
orebody
“feed grade” in respect of mineral processing, the relative content of
gold compared to the full content, including gold and
other substances, in the ore fed at the processing mill,
with reference to the mass with gold in the total mass of
the ore and expressed in g/t Au
GLOSSARY OF TECHNICAL TERMS
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“flotation” a process by which some mineral particles are induced to
become attached to bubbles of froth and float, and others
to sink, so that the valuable minerals are concentrated and
separated from the remaining rock or mineral material
“Flotation-Pressure Oxidation
Method”
a method combined approach first concentrates ore
through flotation and then subjects it to pressure
oxidation, enhancing the breakdown of sulfide minerals
and improving metal recovery
“flotation process method” is a mineral separation technique that uses chemical
reagents and air bubbles to selectively attach and separate
valuable minerals from the ore slurry
“GFA” gross floor area
“g” gram(s)
“g/t” gram(s) per metric tonne — metal concentration
“gold bullion” refined gold in the form of bars
“gold mine production volume”
or “gold production volume”
production volume of gold that is mined from gold mines
and as by-products from non-ferrous metal ores
“gold production” refers to the total amount of gold extracted and processed
from mining operations over a specific period, serving as
a key indicator of a mining project’s performance
“gold recovery rate” the percentage of gold produced compared to the amount
of gold contained in the feed ore in the context of a
processing plant, or the percentage of gold produced
compared to the amount of gold contained in the feed
concentrates in the context of a smelting plant
“grade” ratio of the content of a useful element or its compounds
in an ore, for which the greater the content, the higher the
grade. For gold, grade is commonly expressed in grams
per tonne of milled ore (g/t Au)
“Gravity-Flow All-Slime
Cyanidation Absorption Gold
Extraction Method”
a method combines gravity separation to concentrate gold
before applying cyanidation to the entire slurry, including
slimes, ensuring efficient recovery of fine gold particles
GLOSSARY OF TECHNICAL TERMS
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“Indicated Mineral Resource” or
“Indicated Resource”
is that part of a Mineral Resource for which quantity,
grade (or quality), densities, shape and physical
characteristics are estimated with sufficient confidence to
allow the application of Modifying Factors in sufficient
detail to support mine planning and evaluation of the
economic viability of the deposit. Geological evidence is
derived from adequately detailed and reliable
exploration, sampling and testing gathered through
appropriate techniques from locations such as outcrops,
trenches, pits, workings and drill holes, and is sufficient
to assume geological and grade (or quality) continuity
between points of observation where data and samples
are gathered
“Inferred Mineral Resource”
or “Inferred Resource”
is that part of a Mineral Resource for which quantity and
grade (or quality) are estimated on the basis of limited
geological evidence and sampling. Geological evidence
is sufficient to imply but not verify geological and grade
(or quality) continuity. It is based on exploration,
sampling and testing information gathered through
appropriate techniques from locations such as outcrops,
trenches, pits, workings and drill holes
“kg” kilogram(s), the basic unit of mass in the international
system of units
“km” kilometer(s), a metric unit measure of distance equal to
1,000 meters
“km
2” square kilometer(s)
“koz” thousand ounces, a unit of weight
“kt” thousand metric tonnes, a metric unit of weight, being
equivalent to 1.0 million kg
“ktpa” kt per annum
“ktpd” kt of ore per day
“kWh” kilowatt hours
GLOSSARY OF TECHNICAL TERMS
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“LBMA” London Bullion Market Association, a wholesale over-
the-counter market for the trading of gold and silver,
which sets gold prices twice daily at 10:30 am and 3:00
pm London BST with the price set in U.S. dollars
“LBMA AM” the daily gold prices set by LBMA at 10:30 am London
BST with the price set in U.S. dollars
“LBMA PM” the daily gold prices set by LBMA at 3:00 pm London
BST with the price set in U.S. dollars
“leach” dissolve minerals or metals out of ore with chemicals
“LOM” life of mine. It refers to the shortest timeframe that the
Ore Reserves of a mine are estimated to be fully utilized
after considering the actual situation of the mine and
strategic plan of the mining operation. Should the mine
owner decide to reduce the mining and processing
volume per annum and/or discover additional Ore
Reserves, it would take longer time to utilize the Ore
Reserves of the mine and the life of mine would be
lengthened
“m
2” square metre(s)
“Measured Mineral Resource” or
“Measured Resource”
is that part of a Mineral Resource for which quantity,
grade (or quality), densities, shape, and physical
characteristics are estimated with confidence sufficient to
allow the application of Modifying Factors to support
detailed mine planning and final evaluation of the
economic viability of the deposit. Geological evidence is
derived from detailed and reliable exploration, sampling
and testing gathered through appropriate techniques from
locations such as outcrops, trenches, pits, workings and
drill holes, and is sufficient to confirm geological and
grade (or quality) continuity between points of
observation where data and samples are gathered
“mineralization” area with continuous distribution belts of mineralization,
including the occurrence of deposits, mine sites and
alteration of waste rock, as exploration indicators and
under control of same geology conditions. It is a key zone
for estimation and further planning of exploration of
minerals
GLOSSARY OF TECHNICAL TERMS
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“mined resources and reserves” depleted/write-off resources and reserves
“mining loss” that part of a mineral reserve which is not recovered
during the mining process
“mining rights” the rights to mine Mineral Resources and obtain mineral
products in areas where mining activities are licensed
“Modifying Factors” see the definition under the JORC Code as set out in the
section headed “Summary of the JORC Code” in this
Prospectus
“Mtpa” million tonnes per year
“open pit mine” a deposit from a pit open to surface and usually carried
out by stripping of overburden materials
“open-pit mining” mining of a deposit from a pit open to surface and usually
carried out by stripping of overburden materials
“Open-Pit Mining Method” a surface mining technique that extracts minerals from an
open pit in the ground. Open-pit mining is the most
common method used throughout the world for mineral
mining and does not require extractive methods or
tunnels. This surface mining technique is used when
mineral or ore deposits are found relatively close to the
surface of the earth
“ore” mineral bearing rock which can be mined and treated
profitably under current or immediately foreseeable
economic conditions
“orebody” natural mineral accumulations which can be extracted for
use under existing economic conditions and using
existing extraction techniques
“ore mined volume” the volume of ores mined from gold mines
“ore processing” or “processing”
or “ore processed”
process which in general refers to the extraction of usable
portions of ores by using physical and chemical methods
“ounce(s)” or “oz” unit of weight for precious metals, and one troy ounce
equals 31.1034768 grams
GLOSSARY OF TECHNICAL TERMS
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“overburden materials” consists of non-valuable materials such as soil, rock, and
vegetation that must be removed to access the underlying
mineral deposit during mining operations
“permitted annual production
volume”
also known as “permitted mining capacity”, the amount
of ore allowed to be mined annually as stated on the
mining license
“POX” concentrate pressure oxidation
“processing/smelting recovery
rate”
percentage of metal produced compared to the amount of
metal contained in the feed ore in the context of a
processing plant, or the percentage of metal produced
compared to the amount of metal contained in the feed
concentrates in the context of a smelting plant
“Probable Ore Reserve” is the economically mineable part of an Indicated Mineral
Resource and in some circumstances, a Measured
Mineral Resource. The confidence in the Modifying
Factors applying to a Probable Ore Reserve is lower than
that applying to a Proved Ore Reserve. A Probable Ore
Reserve has a lower level of confidence than a Proved
Ore Reserve but is sufficiently reliable to demonstrate
that, at the time of reporting, extraction could reasonably
be justified
“Proved Ore Reserve” is the economically mineable part of a Measured Mineral
Resource. A Proved Ore Reserve implies a high degree of
confidence in the Modifying Factors. A Proved Ore
Reserve represents the highest confidence category of
Ore Reserve estimate and implies a high degree of
confidence in geological and grade continuity, and in the
Modifying Factors
“refining” final stage of the metallurgical process of refining crude
metal products to a pure or very pure end-product
“rehabilitation” in the context of mining, the process of returning the land
to another productive use or the restoration of land and
environmental values to a mine site after the mining has
been completed
GLOSSARY OF TECHNICAL TERMS
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“Reserves” or “Ore Reserves” portion of the measured and/or indicated resources that
can be economically mined, which is an estimate after a
pre-feasibility study, feasibility study or equivalent
technical and economic evaluation, with possible ore
losses and depletion, and the reasonable use of
conversion factors fully taken into account to make
mining technically feasible and economically viable. This
contains both probable and proved reserves
“Resources” or “Mineral
Resources”
solid Mineral Resources identified by mineral resource
exploration, generally reviewed, and expected to be
economically minable, which quantity, grade or quality is
estimated with reference to geological information,
geological understanding and relevant technical
requirements including Inferred Resources, Indicated
Resources and Measured Mineral Resources
“ROM” run-of-mine, of or relating to ore that is in its natural and
unprocessed state produced from a mine
“smelting” pyro metallurgical process of separating metal by fusion
from those impurities with which it is chemically
combined or physically mixed
“standard gold” gold bullion which satisfies both standard content
requirements (Au99.99, Au99.95, Au99.9, Au99.5) and
standard weight requirements (50g, 100g, 1kg, 3kg,
12.5kg) set by the Shanghai Gold Exchange
“stope” an underground excavation from which ore is being
extracted
“stockpile” is a temporary storage area where mined ore are
accumulated before processing, allowing for operational
flexibility and continuous workflow
“stoping” removal of the ore from an underground mine leaving
behind an open space known as a stope
“stripping ratio” is the amount of waste that needs to be removed to extract
a certain amount of ore, divided by the amount of ore
extracted
GLOSSARY OF TECHNICAL TERMS
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“Sub-Level Open Stoping
Method”
ore is recovered in open stopes normally backfilled after
being mined. Stopes are often large, particularly in the
vertical direction. The ore body is divided into separate
stopes. Between stopes, ore sections are set aside for
pillars to support the hanging wall. Pillars are normally
shaped as vertical beams across the ore body. Horizontal
sections of ore, known as crown pillars, are also left to
support mine workings above the producing stopes
“tailings” the waste materials (residue) produced by the processing
plant after extraction of valuable minerals
“tailings dam” or “TSF” a storage facility for tailings
“tonne” or “t” metric tonne, a metric unit of weight, being equivalent to
1,000 kg
“t/a” tonne per annum
“t/d” tonne per day
“underground mine” openings in the earth accessed via shafts and adits below
the land surface to extract minerals
“underground mining method” is used to extract ore from below the surface of the earth
safely, economically and with as little waste as possible.
The entry from the surface to an underground mine may
be through a horizontal or vertical tunnel, known as an
adit, shaft or decline
“vein” sheet-like body of minerals formed by fracture filling or
replacement of host rock
GLOSSARY OF TECHNICAL TERMS
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SUMMARY OF THE JORC CODE
The Mineral Resources and Ore Reserves statements in this Prospectus have been
prepared in accordance with the JORC Code. The JORC Code is an internationally accepted
Mineral Resources and Ore Reserves classification system established in Australia, which was
first published in February 1989 and last revised in December 2012. The JORC Code is
commonly used in competent person’s report for reporting resources and reserves for public
companies reporting to the Hong Kong Stock Exchange. The JORC Code is used by the
Competent Person to report the Mineral Resources and Ore Reserves of our mines in this
Prospectus.
The JORC Code defines “Mineral Resource” as a concentration or occurrence of solid
material of economic interest in or on the Earth’s crust in such form, grade (or quality) and
quantity that there are reasonable prospects for eventual economic extraction. The location,
quantity, grade (or quality), continuity and other geological characteristics of a Mineral
Resource are known, estimated or interpreted from specific geological evidence and
knowledge, including sampling. Mineral Resources are subdivided in order of increasing
geological confidence into the following categories:
 Inferred Mineral Resource — is that part of a Mineral Resource for which quantity
and grade (or quality) are estimated on the basis of limited geological evidence and
sampling. Geological evidence is sufficient to imply but not verify geological and
grade (or quality) continuity. It is based on exploration, sampling and testing
information gathered through appropriate techniques from locations such as
outcrops, trenches, pits, workings and drill holes;
 Indicated Mineral Resource — is that part of a Mineral Resource for which
quantity, grade (or quality), densities, shape and physical characteristics are
estimated with sufficient confidence to allow the application of Modifying Factors
in sufficient detail to support mine planning and evaluation of the economic viability
of the deposit. Geological evidence is derived from adequately detailed and reliable
exploration, sampling and testing gathered through appropriate techniques from
locations such as outcrops, trenches, pits, workings and drill holes, and is sufficient
to assume geological and grade (or quality) continuity between points of observation
where data and samples are gathered; and
 Measured Mineral Resource — is that part of a Mineral Resource for which
quantity, grade (or quality), densities, shape, and physical characteristics are
estimated with confidence sufficient to allow the application of Modifying Factors
to support detailed mine planning and final evaluation of the economic viability of
the deposit. Geological evidence is derived from detailed and reliable exploration,
sampling and testing gathered through appropriate techniques from locations such as
outcrops, trenches, pits, workings and drill holes, and is sufficient to confirm
geological and grade (or quality) continuity between points of observation where
data and samples are gathered.
SUMMARY OF THE JORC CODE
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The JORC Code defines “Ore Reserve” as the economically mineable part of a Measured
and/or Indicated Mineral Resource. It includes diluting materials and allowances for losses,
which may occur when the material is mined or extracted and is defined by studies at
Pre-Feasibility or Feasibility level as appropriate that include application of Modifying
Factors. Such studies demonstrate that, at the time of reporting, extraction could reasonably be
justified.
Ore Reserves are sub-divided into the following categories:
 Probable Ore Reserve — is the economically mineable part of an Indicated, and in
some circumstances, a Measured Mineral Resource. The confidence in the
Modifying Factors applying to a Probable Ore Reserve is lower than that applying
to a Proved Ore Reserve; and
 Proved Ore Reserve — is the economically mineable part of a Measured Mineral
Resource. A Proved Ore Reserve implies a high degree of confidence in the
Modifying Factors.
The following diagram summarises the general relationship between Exploration Results,
Mineral Resources and Ore Reserves under the JORC Code:
Exploration Results
Mineral Resources
Indicated
Increasing level
of geological
knowledge and
confidence
Inferred
Consideration of mining, processing, metallurgical, infrastructure,
economic, marketing, legal environment, social and government factors
(the “Modifying Factors”).
ProvedMeasured
Probable
Ore Reserves
Source: the JORC Code, 2012
Ore Reserves are generally quoted as comprising a portion of the total Mineral Resource
rather than the Mineral Resources being additional to the Ore Reserves quoted. Under the
JORC Code either procedure is acceptable, provided the method adopted is clearly identified.
The Competent Person’s Reports in this Prospectus report all of the Ore Reserves as part of the
Mineral Resources.
SUMMARY OF THE JORC CODE
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--- page 87 ---
This Prospectus contains certain forward-looking statements relating to our plans,
objectives, beliefs, expectations, predictions and intentions, which are not historical facts and
may not represent our overall performance for the periods of time to which such statements
relate. Such statements reflect the current views of our management with respect to future
events, operations, liquidity and capital resources, some of which may not materialize or may
change. These statements are subject to certain risks, uncertainties and assumptions, including
the other risk factors as described in this Prospectus. Y ou are strongly cautioned that reliance
on any forward-looking statements involves known and unknown risks and uncertainties. The
risks, uncertainties and other factors facing our Company which could affect the accuracy of
forward-looking statements include, but are not limited to, the following:
 our business strategies and plans to achieve these strategies;
 our future debt levels and capital needs;
 changes to the political and regulatory environment in the industry and markets in
which we operate;
 our expectations with respect to our ability to acquire and maintain regulatory
licenses or permits;
 changes in competitive conditions and our ability to compete under these conditions;
 future developments, trends and conditions in the industry and markets in which we
operate;
 general economic, political and business conditions in the markets in which we
operate;
 effects of the global financial markets and economic crisis;
 our financial conditions and performance;
 changes in the price of gold and other metals;
 our dividend policy; and
 change or volatility in interest rates, foreign exchange rates, equity prices, volumes,
operations, margins, risk management and overall market trends.
FORW ARD-LOOKING STATEMENTS
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Additional factors that could cause actual performance or achievement to differ materially
including but not limited to those discussed in the section headed “Risk Factors” and elsewhere
in this Prospectus. In some cases, we use the words “aim,” “anticipate,” “believe,” “can,”
“continue,” “could,” “estimate,” “expect,” “going forward,” “intend,” “ought to,” “may,”
“might,” “plan,” “potential,” “predict,” “project,” “seek,” “should,” “will,” “would” and
similar expressions to identify forward-looking statements. In particular, we use these
forward-looking statements in the sections headed “Business” and “Financial Information” in
this Prospectus in relation to future events, our future financial, business or other performance
and development, the future development of our industry and the future development of the
general economy of our key markets.
We caution you not to place undue reliance on these forward-looking statements which
are based on current plans and estimates, and speak only as of the date they were made. We
undertake no obligation to update or revise any forward-looking statements in light of new
information, future events or otherwise. Past performance is no guarantee of future results, and
forward-looking statements involve inherent risks and uncertainties and are subject to
assumptions, some of which are beyond our control. We caution you that a number of important
factors could cause actual outcomes to differ, or to differ materially, from those expressed in
any forward-looking statements.
Our Directors confirm that the forward-looking statements are made after reasonable care
and due consideration. Nonetheless, due to the risks, uncertainties and assumptions, the
forward-looking events and circumstances discussed in this Prospectus might not occur in the
way we expect, or at all. Statements of or references to our intentions or those of any of our
Directors are made as of the date of this Prospectus. Any such intentions may change in light
of future developments.
Accordingly, you should not place undue reliance on any forward-looking statements in
this Prospectus. All forward-looking statements contained in this Prospectus are qualified by
reference to this cautionary statement.
FORW ARD-LOOKING STATEMENTS
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Potential investors should carefully read and consider all the information set out
in this Prospectus. In particular, you should evaluate the risks and uncertainties
described below before making any investment in our H Shares. This includes (without
limitation) the fact that we conduct a large part of our operations in China, the legal
and regulatory environment of which in some respects may differ from that in Hong
Kong. Any of the risks and uncertainties listed below could have a material adverse
effect on our business, results of operations, financial condition, or on the trading
price of our H Shares (causing them to decline significantly) and could cause you to
lose all or part of your investment. Additional risks and uncertainties not presently
known to us or that we currently deem immaterial could also harm our business, results
of operations, financial condition, or on the trading price of our H Shares. Past
performance is no guarantee of future results.
RISKS RELATING TO OUR BUSINESS AND INDUSTRY
Changes in the market price for gold mining and other Mineral Resources, which in the
past have experienced significant volatility, affect the profitability of our operations and
the cash flows generated by those operations.
During the Track Record Period, a substantial portion of our revenue was derived from
the sales of gold. Our revenue contribution derived from sales of gold mining grew
significantly during the Track Record Period, increasing from 78.5% of our total revenue in
2021 to 84.6% in 2022 and to 87.6% in 2023, and 89.4% for the nine months ended September
30, 2024. We also generated revenue from sales of other Mineral Resources, including,
amongst others, copper, for the same period. From 2019 to 2023, the prices of gold mining and
other Mineral Resources experienced volatility. See “Industry Overview — Overview of the
Gold Industry — Gold Price” for further details of fluctuations in gold price and “Industry
Overview — Overview of the Copper Industry — Copper Price” for copper price. Although we
hedge against the potential financial impacts due to price volatility from time to time, our
hedging strategy may not be effective, and we are exposed to fluctuations in the gold price,
which could lead to fluctuations in our results of operations. Gold price has been and may in
the future be affected by numerous factors beyond our control, including, among others:
 the strength or weakness of the U.S. dollar (the currency in which gold price
generally is quoted) and of other currencies, including the Renminbi, the Lao Kip
and the Ghanaian Cedi, among others;
 the demand for gold, including the demand for gold for different uses, particularly
use in jewellery, technological or industrial uses, investment (including gold bars,
coins and exchange traded funds (“ ETF”)), and central bank reserves;
 actual or expected purchases and sales of gold bullion holdings by central banks or
other large gold bullion holders or dealers;
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 international or regional political and economic events or trends;
 demand for ETFs which replicate the exact performance of gold;
 demand for gold for investment purposes;
 demand for gold investment alternatives, including the emerging demand for
bitcoin, ether and other cryptoassets;
 investor confidence in gold and the gold business;
 speculative trading activities in gold;
 the overall level of forward sales by gold companies;
 the overall cost of production of gold;
 the global gold supply and demand forecasting;
 inflation; and
 interest rates.
It is not possible for us to predict the aggregate effect of these or other factors. If gold
price falls near or below our costs to produce gold, we may experience losses and, should the
gold price remain at such levels for any sustained period, our revenue and profit would be
materially and adversely affected. As a result, we may be forced to curtail or suspend some or
all of our projects or operations or reduce operational expenditures in part or completely. In
addition, we might not be able to recover any losses incurred during or after such periods.
Moreover, since our gold Resources and Reserves estimates are based on assumed gold prices,
our estimates of gold Resources and Reserves may also be affected by significant deviations
from and fluctuations in actual gold prices, resulting in material impairments of our investment
in mining properties or a reduction in our Resources and Reserves estimates and corresponding
restatements of our Resources and Reserves as well as increased amortization, reclamation and
closure charges.
Due to the recent changes in the global geopolitical and economic environment,
including, but not limited to, the persistent inflation, which resulted in the strengthening of
U.S. dollars, the interest rate hikes by major central banks globally, the Russo-Ukrainian War,
and the Hamas-Israel War, the gold price has experienced significant volatility. For example,
according to Frost & Sullivan, for the years ended December 31, 2021, 2022 and 2023, the
average spot price of gold on the Shanghai Gold Exchange was RMB374.3 per gram,
RMB392.1 per gram, and RMB449.6 per gram, respectively. For the same period, the LBMA
PM gold spot price was US$1,798.9 per ounce, US$1,801.3 per ounce, and US$1,942.1 per
ounce, respectively, according to Frost & Sullivan. The fluctuations in gold spot price were
RISK FACTORS
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primarily influenced by the devaluation of Renminbi, global gold supply and demand
forecasting, and political developments and uncertainties according to Frost & Sullivan. The
fluctuations in gold prices have contributed to, and may continue to contribute to, fluctuations
in our revenue and profitability. As a result, a sustained period of significant gold price
volatility may adversely affect our ability to evaluate the feasibility of undertaking new capital
projects or continuing existing operations or to make other long-term strategic decisions.
We primarily engage in gold mining activities and process the gold mined into gold doré
and gold concentrate, and, to a lesser extent, we also produce the copper cathode as by-product
of our gold mining activities as well as other Mineral Resources. During the Track Record
Period, changes in current and expected supply and demand have impacted the market price of
other Mineral Resources. For example, market prices for copper products experienced
fluctuations from 2019 to 2023 according to Frost & Sullivan, primarily as a result of the
fluctuations in market demands. Material declines in the market prevailing copper prices could
adversely affect our business, results of operations, financial condition and prospects.
According to Frost & Sullivan, factors that may impact prices of other Mineral Resources
include, but is not limited to, global economic growth, supply and demand dynamics, changes
to the cost of production including energy and raw materials costs, changes to the cost of
production including labor costs, changes to freight costs, changes to exchange rates,
stockpiling of commodities, technological developments, and COVID-19 impact. There is no
assurance that a fall in prices of other Mineral Resources will not occur.
As a result, any of these factors may adversely affect our businesses, financial condition,
and results of operations.
Our business is subject to a number of operational risks and hazards specific to mining
industry, which may result in increased costs or losses, personal injuries or casualties,
damage to reputation, suspension of operation and other penalties.
Our operations are subject to a number of operational risks and hazards specific to mining
industry, some of which are beyond our control and cannot be completely eliminated through
prevention efforts. Mining, processing and exploration activities are typically exposed to
elements of significant risks and hazards, including, but not limited to, (i) mining risks; (ii)
legal and regulatory risks; (iii) infrastructure and equipment risks; and (iv) environmental,
social, health and safety risks.
Mining Risks. Risks and hazards commonly associated with mining operations include:
 unexpected maintenance or technical problems;
 interruptions to our mining operations due to hazardous weather conditions and
natural disasters, such as, floods, including, but not limited to, surface and
underground flooding, landslides and earthquakes;
 electricity or fuel supply interruptions;
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 critical equipment failures in our mining, processing and production operations;
 the handling and storage of certain dangerous substances and the use of heavy
machinery;
 unusual or unexpected variation in the mine and geological or mining conditions,
such as instability of the slopes and subsidence of the working areas;
 seismic events;
 exposure to health-related hazards, such as inhalable dust, silicosis and noise;
 surface or underground fires and explosions, including those caused by flammable
gas or in connection with blasting;
 cave-ins, blockages, wall collapses or gravity induced falls of ground;
 discharges of gases and toxic substances;
 releases of radioactivity;
 electrocution;
 falling from height;
 accidents related to the presence of mobile machinery, including underground trains
and shaft conveyances;
 industrial accidents, including, but not limited to, accidents and conditions resulting
from drilling, blasting and removing and processing material which would also
include, but is not limited to, the inhalation of dust and noise induced hearing loss;
 human errors and conduct;
 environmental degradation, including pollution of ground and surface water, air or
soil;
 environmental issues, including production disruption due to weather conditions;
and
 other accidents or conditions resulting from mining activities, such as blasting and
the transport, storage and handling of hazardous materials.
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Thereto, our operations involve the handling and storage of explosives and other
dangerous articles. For example, we use sodium cyanide in our gold processing operations. We
have implemented a set of guidelines and rules regarding the handling of dangerous articles,
which comply with applicable existing laws, regulations and policies. However, there can be
no assurance that accidents arising from the mishandling of dangerous articles will not occur
in the future.
The above risks and hazards may result in personal injury, damage to, or destruction of,
properties or production facilities, environmental damages, business interruptions and damage
to our business reputation. Further, dust emission from our production process may adversely
affect the health of our on-site employees and in extreme cases, it may cause pneumoconiosis
or other occupational diseases.
Legal and regulatory risks. As an integrated gold company engaged in mining, processing
and exploration, we are subject to extensive laws, rules and regulations imposed by the
governments in the respective jurisdictions in which we operate regarding production safety.
As these governments continues to strengthen the enforcement of safety regulations in relation
to the mining industry, there can be no assurance that more stringent laws and regulations
regarding production safety will not be implemented or that existing laws and regulations will
not be more stringently enforced. We may not be able to comply with all existing or future laws
and regulations in relation to production safety economically, or at all. Should we fail to
comply with any production safety laws or regulations, we may be required to suspend our
operations, rectify the production safety problems within a limited period and pay fines.
Infrastructure and equipment risks. Our infrastructure and facilities may contain design
defects which may not guarantee the success of commissioning and trial production for smooth
operation in the future. By the same token, our operation may be faced by ageing infrastructure,
unplanned breakdowns and stoppages that may result in production delays, increased costs and
industrial accents. Once shafts reach the end of their planned lifespan and begin operating
under extended life of mine conditions, additional maintenance, condition monitoring and care
is required. The infrastructure in some of our PRC operating regions fall into this category.
Although we have comprehensive strategies in place to address these issues, incidents resulting
in production delays, increased costs or industrial accidents may occur. Such incidents may
have a material adverse effect on our business, financial condition and results of operations.
Similarly, the breakdown of facilities or machinery (and the downtime required to fix or
modify such facilities or machinery) may delay the production and incur significant costs. We
and our third-party contractors may encounter accidents, technical difficulties, mechanical
failure or breakdown in mining, processing and exploration activities, as well as possible
flooding, mudslides, instability of the slopes, and subsidence of the working areas and the like
due to severe weather conditions and natural disasters.
RISK FACTORS
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In addition, as we increasingly conduct mining at greater depths, we may face higher
operational risks associated with deep underground mining, including, but not limited to,
increased stress on our mining structures, increased temperatures and ventilation difficulties,
higher risk of rock bursts and seismic activities that may affect the operation and safety of our
mines. Deeper mining will require us to enhance our mining infrastructure, methods and
techniques, and devote more manpower and utilities to our mining activities, which will
increase our costs. For example, from time to time the Wassa Gold Mine may be adversely
affected by severe weather conditions as its climate, terrain and vegetation are conducive to
naturally occurring fires.
Furthermore, our operations rely on the existence and maintenance of appropriate and
adequate infrastructure, including, but not limited to, the continuous and stable supply of
power, at our mining concessions and surrounding areas. As a result, our operations may be
adversely affected where such infrastructure ceases to exist or fails to be properly maintained
by the local authorities and/or third parties. This may be beyond our control, and such risks
cannot be completely eliminated through prevention efforts.
Environmental, social, health and safety risks. The mining industry is inherently
susceptible to work-related injuries and industrial and mining accidents. See “— Our workers
are subject to risks of serious injury caused by use of machinery, production equipment and
tools and other production-related risks.” Such incidents may also result in breaches of the
conditions for our mining and exploration licenses or any other approvals, permits or
authorizations, which may result in fines and penalties or even potential revocation of such
licenses, approvals, permits and authorizations. There can be no guarantee that accidents will
not occur at our operations in the future despite our efforts to comply with safety protocols and
applicable laws and regulations. Should we fail to comply with any relevant laws, regulations
or policies or should any accident occur, our reputation, business, financial condition, and
results of operations may be adversely affected, and we may be subject to penalties, civil
liabilities, and/or criminal liabilities. Moreover, our operations may be affected by accidents of
third parties. In addition to adversely affecting our business and results of operations, safety
accidents in the region may also adversely affect our reputation.
Finally, our operations are subject to health and safety legislation which imposes duties
and obligations on the employer to ensure, amongst other things, a working environment which
is healthy and safe, as far as is reasonably practicable. For details, see “Regulatory Overview
— Laws and Regulations Relating to Safe Production.” In terms of the health and safety
legislation, an employer may be subject to significant penalties and/or administrative fines for
non-compliance. Depending on the particular circumstances, litigation (criminal and/or civil)
may be instituted against the employer in respect of an accident, dangerous occurrence or
health threatening occurrence which has resulted in the death of an employee (or contractor
staff). Any changes to the health and safety laws which increase the burden of compliance on
the employer and impose higher penalties for non-compliance may result in further significant
costs for us.
RISK FACTORS
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We may not be able to expand or replenish our Mineral Resources and Reserves through
exploration.
The limited life of mines requires us to replenish our Reserves from time to time.
Moreover, discovery of new Mineral Resources and Reserves is crucial to our growth. During
the Track Record Period, we have continued to carry out exploration work in areas where we
hold exploration permits. However, exploration of Mineral Resources and Reserves is
speculative in nature, and our exploration activities may not result in the discovery of Mineral
Resources. Furthermore, the future mining and development in the areas currently covered by
exploration licenses is subject to further government approvals. There can be no guarantee that
our future plan to expand our Mineral Resources and Reserves will succeed. Such plans may
be delayed or adversely affected by various factors, including, but not limited to, failure to
obtain relevant regulatory approvals, failure to secure sufficient financing to fund our
expansion and production, the occurrence of geotechnical difficulties, constraints on
managerial, operational, technical and/or other resources, and the incurrence of higher-than-
expected operational costs. In addition, to the extent we participate in the development or
operation of a project through a joint venture or any other multi-party commercial structure,
there could be technical, legal or other disagreements, or divergent interests or goals among the
parties, which could jeopardize the success of the project.
In addition, if a viable deposit is discovered, it could take several years and a large
amount of capital expenditure from the initial phases of exploration to production
commencement, during which time the presumed market price of gold may change, and the
capital cost and economic feasibility of such deposit may change. There is also no assurance
that we will have, or be able to raise, the required funds to engage in these activities or to meet
our obligations with respect to any exploration properties in which we have or may acquire an
interest. Furthermore, there can be no assurance that reported Resources will be converted into
Reserves, and actual results upon production may materially differ from those anticipated at the
time of discovery. Accordingly, there can be no assurance that any future exploration activities
or development projects will extend the life of our existing mining operations or result in any
new economic mining operations. For our future expansion plans, please refer to “Business —
Development and Expansion”. In the event we fail to replace our Resources and Reserves
depletion, to expand our Resources or Reserves base or our future expansion plans are delayed
or fails to deliver the expected economic benefits, our business, financial condition, results of
operations and future growth may be materially and adversely affected.
We may fail to obtain, maintain or renew the government permits, licenses and approvals
required for our mining and exploration activities.
Our right to exploit mineral deposits is governed by the laws and regulations of the
jurisdictions in which our mining properties are located. Currently, a significant portion of our
deposits are located in countries where mining rights could be suspended or cancelled should
we breach our obligations in respect of the acquisition and exploitation of these rights.
RISK FACTORS
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In all of the countries where we operate, the formulation or implementation of
governmental policies on certain issues may be unpredictable. This may include changes in
laws relating to mineral rights and ownership of mining assets and the right to prospect and
mine, and, in extreme cases, nationalization, expropriation or nullification of existing rights,
concessions, licenses, permits, agreements and/or contracts.
Under the PRC Mineral Resources Law, all Mineral Resources in the PRC are owned by
the State. Mining companies, including our Company, are required to obtain mining and
exploration permits prior to undertaking any mining or exploration activities, and the mining
and exploration permits are limited to a specific geographic area and a certain time period. Our
mining licenses in the PRC are generally valid for several years to 30 years. Our exploration
permits are generally valid for five years and renewed accordingly subject to some conditions.
Under the current Laotian laws and regulations, mining concessions provide up to twenty (20)
years’ mining rights to the holder, with such initial term being extendable for ten (10) year
periods at a time. LXML has nevertheless been granted a mining concession by the
Government of the Lao PDR under its Mineral Exploration and Production Agreement
(MEPA), as amended, with an operating period of thirty (30) years, or until September 29,
2033, with the right to apply for two extensions, with each extension being for a period of ten
(10) years, in accordance with mining legislation at the time of the 1st MEPA Amendment,
which provided for the period of mining concession of up to thirty (30) years, subject to two
extensions of ten (10) year periods. Under the current Ghanaian laws and regulations, mining
concessions provide up to thirty (30) years’ mining rights to the holder. In addition, pursuant
to relevant PRC, Laotian, and Ghanaian laws and regulations, before commencing production,
we are required to pass a number of inspections and obtain permits and licenses with respect
to environmental protection and production safety, among other things.
As of the Latest Practicable Date, we held a total of 12 valid mining licenses in the PRC,
including (i) one mining license for Wulong Mining, (ii) two mining licenses for Jilong Mining,
(iii) six mining licenses for Huatai Mining, (iv) one mining license for Jintai Mining, and (v)
two mining licenses for Hanfeng Mining. In addition, as of the Latest Practicable Date, we held
5 valid exploration permits in the PRC, including (i) one exploration permit for Jilong Mining,
(ii) two exploration permits for Wulong Mining, (iii) one exploration permit for Jintai Mining,
and (iv) one exploration permit for Hanfeng Mining. Moreover, as of the Latest Practicable
Date, we held one valid mining license and one valid exploration permit in Laos. In addition,
as of the Latest Practicable Date, we held two valid mining licenses and three valid exploration
permits in Ghana, with one mining license having been renewed by the Ministry of Lands and
Natural Resources and in the process of being ratified by Parliament. We need to renew or
obtain relevant permits for our operations from time to time, including, but not limited to,
mining permits and exploration permits. As of the Latest Practicable Date, although one mining
lease of GSWL has been renewed by the Ghanaian Government, it is still pending ratification
by the Parliament of Ghana as required by the Ghana Constitution. It is stipulated in the
subsection 44(4) of the Mining Act of Ghana that a holder of the mining lease has made an
application for extension of the term, the lease shall continue in force in respect of the subject
of the application until the outcome of application is determined. As advised by our Ghana
Legal Advisor, this means the lessee is able to continue its ongoing mining operations under
RISK FACTORS
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the old lease until the new lease is ratified by Parliament. It remains uncertain when such
mining lease will be ratified. LXML applied for rare earth mining right with respect to an area
of 2.96 km
2 located within its mining area. Chijin Laos applied for rare earth exploration right
with respect to an area of 50 km 2 in the Kham District of Xiangkhouang Province. Chijin Laos
had also submitted two applications in relation to prospecting, exploration, and a technical
feasibility study on (i) rare earth minerals within a 19.88 km
2 area in Phouvineg and Phouluang
Villages, Hiem District, Huaphan Province and (ii) gold and associated minerals within a 180
km
2 area in Giem District, Huaphan Province, respectively. These applications are currently
put on hold by the relevant governmental authorities in Laos, as the Laos government has
suspended review of all rare earth pilot project applications. For details, see “Business — Our
Rare Earth Business in Laos.”
In addition, to comply with Laos environmental laws, we have submitted an updated
environmental and social impact assessment and an environmental and social management and
monitoring plan to the Laotian Government for the expanded project scope at our mines in
Laos, which is pending review by the Laotian Government. There can be no assurance that the
review will be completed in time, as per our current expectation, or at all, which may hinder
the expansion of our Laos mining project. During the Track Record Period and up to the Latest
Practicable Date, we failed to obtain the environmental impact assessment approvals for two
production facilities in the PRC in a timely manner. For details, please refer to the section
headed “Business — Licenses and Permits”. There can be no guarantee that all of our
applications will be approved by the relevant government authorities. Also, there can be no
assurance that we will be able to fully and economically utilize the entire Mineral Resources
of all of our mines during the currently effective permit or approval periods.
We meet the substantive and procedural conditions stipulated in the relevant laws and
regulations, we may not be able to obtain or renew such approvals, licenses or permits, comply
with all conditions requested by governmental authorities to maintain those permits, or obtain,
retain or renew other approvals, licenses and permits necessary for our business operations in
the future, either in respect of our existing mines or at any mines we may operate in the future.
There can be no guarantee that we will at all times maintain or act in compliance with our
existing permits by the relevant governmental authorities. In addition, we may require new
permit(s), license(s) and/or approval(s) from time to time. Changes in local laws, regulations
and policies, including those with respect to environmental protection and mining and
exploration activities, are outside of our control may affect our ability to obtain timely
renewals for such permits, licenses and/or approvals, and during such time we may be
compelled by law or regulators to cease mining and exploration activities in accordance with
PRC, Laotian and Ghanaian laws and regulations.
Any failure to obtain, retain or renew, or any delay in obtaining or renewing, such
approvals, licenses or permits could subject us to a variety of administrative penalties or other
government actions and adversely impact our business, financial condition and results of
operations.
RISK FACTORS
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Artisanal mining, gold theft and robbery may occur on some of our properties. These
activities are difficult to control and can disrupt our business and expose us to liability.
Artisanal mining activities, theft and robbery of gold bearing materials and production
inputs are common in Laos and Ghana. Illegal mining is mining activity that is carried out
without land rights, mining license, exploration or transportation permit, or any document that
can legitimate the ongoing operations. It is generally associated with a number of negative
impacts, including poor working practices, corruption, child labor and human trafficking.
Effective local government administration is often lacking in the locations where illegal and
artisanal miners operate because of rapid population growth and the lack of functioning
structures which can create a complex and unstable social environment. Activities of the illegal
miners and artisanal miners may cause pollution or other damage to our properties, including,
for example, underground fires, or personal injury or death, for which we may potentially be
held liable. In addition, activities of artisanal mining may cause safety concerns and a negative
image of our Company. In particular, artisanally-mined gold channeled through large-scale
mining operators like us may impact negatively on the reputation of our Company as well as
the industry. Illegal miners are often assisted by a syndicate of employees of legal mining
operations. Consequently, in the event that our employees are found to be assisting illegal
miners we will be required to dismiss all implicated employees, and this may result in labor
unrest. Illegal mining activities could also result in depletion of mineral deposits, potentially
making the future mining of such deposits uneconomic. The presence of illegal miners could
lead to project delays and disputes regarding the development or operation of commercial gold
deposits. During the Track Record Period, several illegal surface mining incidents occurred in
the exploration rights area of Wassa Gold Mine. The illegal miners caused minor damages to
office facilities and disruptions to operations for one to two days.
Any theft or robbery of gold may reduce the amount of gold that we are able to recover
from our operations. Rising gold prices may increase the likelihood such thefts or robbery
occurring. There can be no assurance that our security measures will effectively prevent illegal
activities — which may be committed by third parties, employees or former employees — from
happening in the future, or, in such case, that our insurance will be adequate to recover part
or all of our loss (if any). Illegal mining, gold theft and robbery could result in lost Ore
Reserves, mine stoppages, and have a material and adverse effect on our business, results of
operations and financial position.
We are subject to regulatory or legislative impositions of various costs, and such
legislative changes to which may have a material adverse effect on our operations and
profits.
In recent years, governments (local and national), communities, non-governmental
organizations and trade unions in several jurisdictions, have sought and, in some cases, have
implemented greater costs on the mining industry, including, for example, the imposition of
additional taxes and royalties, and relevant policies.
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For example, in Ghana, the ownership of land on which there are mineral deposits is
separate from the ownership of the minerals, as minerals are the property of the Ghanaian
Republic and are vested in the president in trust for the people of Ghana. Under the Ghanaian
Minerals and Mining Act, 2006 (Act 703) (“ Minerals and Mining Act ”), the Government of
Ghana has a statutory right to a free 10% carried interest in the rights and obligations of all
mineral operations in Ghana. In addition, stool/land rents of approximately GH
₵15.00 per acre
are payable to the Government of Ghana. The annual ground rent was GH ₵15.00 for the years
ended December 31, 2021, 2022 and 2023 and GH ₵40.00 for the nine months ended September
30, 2024. In 2021, 2022, 2023 and the nine months ended September 30, 2024, the amount of
ground rent paid by the Group was GH
₵ 0.42 million, GH ₵0.42 million, GH ₵0.42 million, and
GH₵1.14 million. Furthermore, under the Minerals and Mining Act the Ghanaian Minister of
Lands and Natural Resources has the right of pre-emption over all minerals obtained in Ghana
and products derived from the refining or treatment of these minerals. In February 2018, the
Government of Ghana announced that it would implement an audit program targeted at mining
companies in Ghana, and as such, we may be subject to additional audits that could result in
the reversal of currently recorded tax losses or additional tax expenses. On July 31, 2018, the
Ghanaian Minister of Lands and Natural Resources informed the Ghanaian Chamber of Mines
of the Government of Ghana’s intention to exercise its right of pre-emption to acquire up to
20% of all gold mined in Ghana for the benefit of Ghanaian refineries. In November 2022, the
Government of Ghana directed all gold mining companies, effective January 2023 to sell up to
20% of their products to the Bank of Ghana to be paid for at the World Market Spot Price in
Ghanaian Cedis. Since then we have been selling 20% of our products to the Bank of Ghana
in accordance with the legal provisions. We generally are able to utilize all Ghanaian Cedis for
our operating expenses, but there is a risk that our holding of Ghanaian Cedis is subject to
fluctuation and foreign exchange loss.
For the details of the taxes and royalties that we are subject to, see the section headed
“Regulatory Overview” in this Prospectus. The policies adopted may impose additional
restrictions, obligations, operational costs, taxes or royalty payments on gold mining
companies, including us, any of which could have a material adverse effect on our business,
financial condition and results of operations.
We may be subject to risks relating to operating our overseas business.
Our overseas revenue contributed a substantial portion during the Track Record Period,
accounting for 66.7%, 76.4%, 71.9% and 71.2% of our total revenue for the years ended
December 31, 2021, 2022 and 2023 and the nine months ended September 30, 2024,
respectively. An important driver of such overseas revenue growth during the Track Record
Period is our global expansion.
RISK FACTORS
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In November 2018, we acquired a 90% equity interest in LXML. LXML is a large local
mining enterprise in Laos focusing on gold and copper mining and processing business,
specifically engaged in the production and operation of the mines of Sepon Gold and Copper
Mine. The remaining 10% equity interest in LXML is held by the Laotian Government. In
January 2022, we acquired an 62% equity interest in Golden Star Resources, which in turn
indirectly holds an 90% equity interest in GSWL. GSWL is a large local mining enterprise in
Ghana focusing on gold mining and processing business, specifically engaged in the production
and operation of the mines of GSWL. The remaining 10% equity interest in GSWL is held by
the Ghanaian Government. In January 2023, we acquired a 51% equity interest in Xinhenghe
Mining, which directly holds a 90% stake in Jintai Mining. Jintai Mining is a local mining
enterprise in China focusing on gold mining and processing business, specifically engaged in
the production and operation of the mines of Jintai Mining. In March 2024, an equity transfer
agreement was entered into among China Investment, Chixia Laos and Chijin Xiawu, pursuant
to which Chixia Laos shall acquire from China Investment 90% equity interest in China
Investment Mining (Laos) Sole Co., Ltd., which in turn holds an 86% equity interest in CIRE
Mining. CIRE Mining is a large local mining enterprise in Laos focusing on rare earth mining
and processing business, specifically engaged in the operation of the trial mining area of the
Mengkham Rare Earth Element Project. These acquisitions have further enhanced our mining
operations and gold production.
We believe our increased Mineral Resources and enlarged production scale as well as our
expansion into overseas markets will present us with further growth opportunities. However,
there can be no guarantee that there will not be any material disputes between local government
authorities and us in connection with the performance of a party’s obligation or the scope of
a party’s responsibilities under relevant agreements, nor can we guarantee that we will be able
to resolve any such disputes through amicable negotiation. In the event a material dispute
cannot be resolved, the business and operations of LXML, GSWL, Jintai Mining, and/or CIRE
Mining may be adversely affected. Furthermore, any potential social unrest and changes in
regimes could have an adverse impact on the business of LXML, GSWL, Jintai Mining, and/or
CIRE Mining. In the event that any of the above occurs, our business, financial condition and
results of operations may be adversely affected.
Our current overseas operations, namely our operations in Laos and Ghana, as well as any
future overseas operations that we set up or acquire, expose us, and may further expose us, to
various risks associated with conducting business in foreign countries and territories, which
may include, among other risks:
 an increase in competition from local or international competitors or failure to
anticipate changes to the competitive landscape in overseas markets;
 difficulties integrating overseas business and management systems with our existing
operations;
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 potential risks, including civil unrest, acts of terrorism, acts of war, regional and
global political or military tensions, strained or altered foreign relations, and
political instability and uncertainty, which may lead to interruptions in our business
operations and/or loss of property;
 economic, financial and market instability and credit risks;
 difficulties and costs associated with complying with, and enforcing remedies under,
a wide variety of complex domestic and international laws, treaties, regulations, and
rules;
 inability to obtain or maintain the requisite licenses, permits, approvals and
certificates in foreign jurisdictions;
 economic sanctions, trade restrictions, trade barriers such as imposition of tariffs,
discrimination, protectionism or unfavorable policies against PRC companies;
 potential loss of key employees, and difficulties with staffing and managing
overseas operations after localization, including with respect to compliance with
local labor laws;
 exposure to litigation or third-party claims outside of the PRC, including labor
disputes;
 foreign currency exchange controls and fluctuations;
 uncertainties in the interpretation and application of tax laws and regulations, more
onerous tax obligations and unfavorable tax conditions;
 potential disputes with, and loss of, overseas or international customers or other
parties we work with;
 cultural differences and language barriers;
 infringement of our intellectual property rights in foreign jurisdictions; and
 lack of a well-developed or independent legal system in certain foreign jurisdictions
in which we conduct our business, which may create difficulties in the enforcement
of our legal rights.
Any of the above factors could lead to, among other things, business disruptions and
increased costs and losses, which could have a material and adverse effect on our business,
results of operations and overall growth. In particular, current and future geopolitical tensions
globally and political tensions in the jurisdictions we operate could have a material and adverse
impact on our existing business and future strategies.
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We are subject to risks related to exchange rate fluctuations, because our gold product
from overseas operation is priced in U.S. dollars and our operating costs and expenses are
incurred in different currencies, including, but not limited to, Lao Kip and Ghanaian
Cedi.
The revenue generated and cost incurred by our Company and PRC subsidiaries are
denominated in Renminbi. The revenues of our overseas subsidiaries are denominated in U.S.
dollars, while operating costs and expenses of our overseas subsidiaries are denominated in
different currencies, primarily in U.S. dollars and in some cases in local currency. In addition,
as our group reporting currency is Renminbi and the functional currency of our overseas
subsidiaries is U.S. dollar, the financial report of overseas subsidiaries are converted to
Renminbi for consolidation. Any exchange rate fluctuation between U.S. dollars, Lao Kip and
Ghanaian Cedi, and Renminbi will affect our financial performance.
We operate a significant part of our business in Laos and Ghana. Revenue generated by
our operations in Laos and Ghana are denominated in the U.S. dollar through sales of gold and
copper where international refineries and traders purchase our products with prices set
referencing to LBMA and LME market prices, respectively. In November 2022, the
Government of Ghana directed all gold mining companies, effective January 2023 to sell up to
20% of their products produced in Ghana to the Bank of Ghana to be paid for in the Ghanaian
Cedi at the World Market Spot Price, which is denominated in the U.S. dollar. Since then we
have been selling 20% of our products produced in Ghana to the Bank of Ghana in accordance
with the legal provisions. The operating and capital costs for our mines there are predominantly
denominated and paid in the U.S. dollar with a minor part of costs denominated in the Lao Kip
or the Ghanaian Cedi and paid in the Lao Kip or the Ghanaian Cedi, respectively. As a result,
our business, financial condition and results of operations are affected by exchange rate
fluctuations between the U.S. dollar and the Lao Kip as well as the Ghanaian Cedi.
As a certain amount of local currency is necessary for daily operation, there is a risk that
our holding of Lao Kips and Ghanaian Cedis is subject to fluctuation and foreign exchange
gain or loss. For the three years ended December 31, 2021, 2022 and 2023 and the nine months
ended September 30, 2024, our net foreign exchange gains of RMB86.2 million, RMB27.2
million, RMB20.2 million and RMB27.8 million, respectively, were primarily due to exchange
rate fluctuations. The Ghanaian Cedi has depreciated sharply against the U.S. dollar since the
start of 2022, with a decline of more than 55% between January and October 2022, primarily
due to lack of access to financial markets and significant debt servicing commitments by the
Ghanaian government. The Lao Kip has also depreciated sharply against the U.S. dollar since
August 2020, with a decline of approximately 50% from December 2021 to December 2022,
primarily due to the economic challenges from the COVID-19 pandemic and public debt and
fiscal challenges in Laos.
During the Track Record Period, the Renminbi, our Group’s presentation currency,
experienced significant depreciation against the U.S. dollar, the overseas subsidiaries’
functional currency. We recognized other comprehensive loss on exchange differences on
translation of foreign operations of RMB59.2 million and RMB79.9 million in 2021 and for the
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nine months ended September 30, 2024, respectively, and recognized other comprehensive
income on exchange differences on translation of foreign operations of RMB563.0 million and
RMB109.5 million in 2022 and 2023, respectively. The amount of transactions denominated in
the Renminbi under our overseas subsidiaries are minimal and we normally will not arrange
hedging between the Renminbi and the U.S. dollar. There can be no guarantee that future
fluctuations of the exchange rate would not have a material and adverse impact on our
business, financial condition and results of operations.
We also have four subsidiaries conducting gold mining business in the PRC. Since the
trend in gold price in the PRC, which is denominated in the Renminbi, is generally consistent
with the trend in international gold price, which is denominated in the U.S. dollar, and the gold
price in the PRC takes into account Renminbi/U.S. dollar exchange rate fluctuations, our
earnings may be materially affected by a material change in Renminbi/U.S. dollar exchange
rate. For example, if the Renminbi depreciates against the U.S. dollar, gold price in the PRC,
which is denominated in the Renminbi, may increase, thereby having a positive impact on our
revenue in the PRC. As of December 31, 2021, 2022 and 2023 and September 30, 2024,
Renminbi to U.S. dollar exchange rate was 6.38:1, 6.96:1, 7.08:1 and 7.00:1, respectively,
according to the central parity rate of Renminbi from SAFE. Since December 31, 2022,
Renminbi to U.S. dollar exchange rate has also experienced significant volatility.
The value of Lao Kip, Ghanaian Cedi and Renminbi is subject to changes in the local
governmental policies and international economic and political environment. The respective
local government may adopt further reforms of the local exchange rate system in the future.
There can be no assurance that such exchange rate will remain stable against U.S. dollar or
other foreign currencies in the market. V olatility of Lao Kip, Ghanaian Cedi and Renminbi
against foreign currencies may adversely affect our local and overseas operations.
Rising inflation may have a material adverse effect on our business, financial condition
and results of operations.
Our business has been, and may continue to be, directly affected by volatile commodity
costs and other inflationary pressures. Inflation in the PRC, Laos and Ghana could increase our
production costs and expenses, including, for example, raw materials, transportation, wages
and power costs. The average annual inflation rate, indicated by the average annual percentage
change in the consumer price index was 1%, 2% and 0.2% for PRC, 10.0%, 31.3% and 38.1%
for Ghana, and 3.8%, 23.0% and 31.2% for Laos in 2021, 2022 and 2023, respectively,
according to the World Bank Group.
Geopolitical risks and conflicts around the world could further disrupt supply chains and
create additional inflationary pressures. Specifically, the Russo-Ukrainian War has led to
sanctions, travel bans, and asset or financial freezes being levied by the United States,
European Union and other countries against Russian entities and individuals, with additional
sanctions being proposed. These sanctions and other measures have had a significant impact on
commodity prices, including increased oil, gas, ammonia nitrate, copper, steel and gold prices.
The oil price is a driver of a number of our input costs, including fuel and transport costs, while
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gas prices have an impact on power costs, and other commodity prices drive direct mining and
processing costs. These inflationary pressures could also cause interest rates and the cost of
borrowing to increase and could have a material adverse effect on global financial markets and
economic conditions. The extent and duration of the war, sanctions and resulting market
disruptions are impossible to predict. Any inflationary impacts or disruptions caused by the war
or resulting sanctions may have a material adverse effect on our business, financial condition
and results of operations, and may magnify the impact of other risks described in this
document.
Our Mineral Resources and Ore Reserves estimates are based on a number of
assumptions, which, if changed, may require us to lower our estimates.
Our Mineral Resources and Ore Reserves estimates are based on a number of
assumptions. Neither Mineral Resource estimates, nor Ore Reserve estimates, are precise
calculations. Ore Reserve estimates are based on available assumptions and considerations on
extraction of Measured and Indicated Mineral Resources; and the Mineral Resources estimates
are dependent on the interpretation of limited information on the location, shape and continuity
of the occurrence and on the available sampling results. The accuracy of the estimates depends
on the quantity and quality of available data, the assumptions made, and the judgments used
in engineering and geological interpretation, which in each case may prove to be unreliable.
The Ore Reserves estimates contained in this Prospectus represent the tonnage and grade
of gold and other Mineral Resources that we believe can be economically mined and processed
and are estimated based on a number of economic and technical assumptions, including our
costs, expenditures, commodity prices, currency exchange rates, geological and design losses,
dilutions, metallurgical and mining recovery assumptions, which may prove inaccurate due to
a number of factors, many of which are beyond our control. Ore Reserve estimation is a
time-related behavior and activity, and the Ore Reserves presented in this Prospectus has
reflected the considerations and assumptions made being valid on the date of the Competent
Person’s Report, and such considerations and assumptions comprise of the Modifying Factors.
In the future, we may need to update the Modifying Factors and further our Ore Reserves if,
for instance, our production costs increase or the prices of gold and/or other Mineral Resources
decrease and as a result the extraction of a portion (or all) of the Ore Reserves at our mines
becomes uneconomic. There is no assurance that our estimates will prove accurate or that the
Ore Reserves can be mined or processed profitably. For details, please refer to “Appendix IIIB
— Competent Person’s Report for the Sepon Gold and Copper Mine — 20 Project Qualitative
Risk Analysis” and “Appendix IIID — Competent Person’s Report for the Sepon Rare Earth
Element and Mengkham Rare Earth Element Projects in Lao People’s Democratic Republic —
19 Risk Analysis”.
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In addition, compared to Measured or Indicated Mineral Resources, Inferred Mineral
Resources have a greater amount of uncertainty as to their existence and as to whether they can
be mined economically as such Mineral Resources are inferred from geological evidence and
assumed but not verified. It cannot be guaranteed that all or part of the Inferred Mineral
Resources will ever be upgraded to a higher category. No Inferred Mineral Resources have
been included in LOM plan presented in this Prospectus.
The inclusion of Mineral Resources estimates should not be regarded as a representation
that all these amounts can be economically mined or processed, and nothing contained in this
Prospectus should be interpreted as assurances of the economic viability of the mines that we
hold mining licenses or exploration permits to or the profitability of our future operations. A
reduction of our Mineral Resources or Reserves, including due to any of the above could have
a material adverse effect on our business, financial condition and results of operations.
We amortize our mining rights based on the units-of-production method. For the years
ended December 31, 2021, 2022 and 2023 and the nine months ended September 30, 2024, our
amortization expenses related to our mining rights amounted to RMB313.8 million, RMB578.3
million, RMB546.8 million and RMB223.1 million, respectively. We review the remaining
useful life of our mining rights in accordance with our production plans and Reserves levels
of each mine. Any material decrease in the amount of our Reserves for our mines or changes
to our production plans may result in impairment of the carrying value of our mining and
exploration rights, which may have a material and adverse effect on our business, financial
condition and results of operations.
We may not be able to obtain financing on favorable terms, or at all, to fund our on-going
operations, existing and future capital expenditure requirements, acquisitions and
investment plans and other funding requirements, and our ability to raise additional
funds could be materially affected by the fluctuations in the capital markets. If we do not
obtain additional financing, our business may be at risk or execution of our development
plan may be delayed.
As of September 30, 2024, we had cash and cash equivalents of RMB2,094.1 million, and
we incurred net profit of RMB613.4 million, RMB493.9 million, RMB871.6 million and
RMB1,264.8 million for the years ended December 31, 2021, 2022 and 2023 and the nine
months ended September 30, 2024, respectively. Our mining, production and exploration
activities are highly capital intensive. During the Track Record Period, we had funded our
working capital and capital expenditure primarily through cash flow from operations, bank
loans and gold leasing contracts. As our capital expenditure is significantly more than the
proceeds from our Global Offering, such proceeds may not be sufficient to cover our capital
expenditure. To fund our ongoing operations, existing and future capital expenditure
requirements, investment plans and other financing requirements, we may need access to
additional financing from external sources in addition to internal sources of liquidity.
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Obtaining additional funding will be subject to various factors, including general market
conditions, investor acceptance of our business plans, lenders’ perception of our
creditworthiness, the global and local economies, regulations that affect the availability and
costs of financing, and ongoing results from our construction and commissioning efforts. Any
disruptions, uncertainty or volatility in the capital and credit market resulting from any global
financial crisis may also limit our ability to obtain financing to meet our funding requirements.
These financings could require contractual or other restrictions on our operations or on
alternatives that may be available to us. If we raise additional funds by issuing debt securities,
these debt securities could impose significant restrictions on our operations. Any such required
financing may not be available in amount or on terms acceptable to us, and the failure to
procure such required financing could have a material and adverse effect on our development
plan and continuous growth.
If we are unable to raise adequate funds, we may have to delay some of our development
projects or expansion plans therefore affecting our profitability in the short and long term. If
we do not have, or are not able to obtain, sufficient funds, we may be required to delay further
development or commercialization of our Mineral Resources. Any of these factors could harm
our operating results.
Our workers are subject to risks of serious injury caused by use of machinery, production
equipment and tools and other production-related risks.
The mining industry is characterized by a higher risk of mining accidents due to the
nature of the work environment, which is typically underground, confined, and subject to
geological uncertainties. The risk of accidents is further exacerbated by the use of heavy
machinery such as drilling machines and scrappers, which are potentially dangerous in our
operations. Furthermore, there is risk associated with the use of hazardous, toxic or flammable
raw materials and intermediate products. The storage of such materials near our production
facilities and the handling of these materials in the mining and production process pose
inherent risks.
Despite our efforts to protect our employees’ health through executing safety measures,
we cannot rule out such risks caused by factors beyond our control. An accident could lead to
death or personal injuries and could materially disrupt our mining and manufacturing
operations. During the Track Record Period, we had two safety production accidents, for which
we received administrative penalties from the relevant authorities in China, and several
work-related injuries in Laos. For details, please refer to “Business — Occupational health and
safety”. We may also be subject to business interruptions caused by equipment shutdowns for
government investigation or implementation or imposition of safety measures as a result of the
accident. Any such accident may also subject us to adverse publicity and damage to our brand
name and reputation. Due to the growing awareness of and concern about safety and
environmental protection, the risk of such accident may result in social demonstrations against
the construction and operation of our plants and facilities, which may further disrupt our
business operations, negatively affect our image and reputation and materially and adversely
affect our business and financial condition.
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To the extent that we seek to expand through acquisitions, investment in joint ventures
and associates, and strategic collaborations, we may experience problems and difficulties
in executing, managing and integrating the acquisitions, joint ventures, associates and
strategic collaborations.
From time to time, we evaluate the acquisition of Ore Reserves, development properties
or operating mines, either as stand-alone assets or as part of existing companies. The decision
to acquire these properties may be based on a variety of factors, including, for example,
historical operating results, estimates and assumptions regarding the extent of the Ore
Reserves, cash and other operating costs, mineral prices, projected economic returns and
evaluations of existing or potential liabilities (including environment liabilities) associated
with the relevant property and its operations and how these factors may change in the future.
Other than historical operating results, these factors are uncertain and could have an impact on
revenue, cash and other operating costs, as well as the process used to estimate the Ore
Reserves. To the extent that we are unable to realize the anticipated benefits of such
acquisitions, our growth strategy, along with our business, financial condition and results of
operations, may be materially impacted.
Over the past few years, we have entered into negotiations relating to certain target
companies in which we were interested in acquiring a stake. For example, in November 2018
we acquired a 90% equity interests in LXML. LXML is a large local mining enterprise in Laos
focusing on gold and copper mining and processing business, specifically engaged in the
production and operation of the Sepon Gold and Copper Mine. In January 2022, we acquired
a 62% equity interests in Golden Star Resources, which in turn indirectly holds 90% an equity
interest in GSWL. In January 2023, we acquired a 51% equity interest in Xinhenghe Mining,
which directly holds a 90% stake in Jintai Mining. This acquisition has further enhanced our
mining operations and gold production. In March 2024, an equity transfer agreement was
entered into among China Investment, Chixia Laos and Chijin Xiawu, pursuant to which Chixia
Laos shall acquire from China Investment 90% equity interest in China Investment Mining
(Laos) Sole Co., Ltd., which in turn holds an 86% equity interest in CIRE Mining. CIRE
Mining is a large local mining enterprise in Laos focusing on rare earth mining and processing
business, specifically engaged in the operation of the trial mining area of the Mengkham Rare
Earth Element Project.
To further grow our businesses and increase our competitiveness and profitability, we
intend to continue expanding our mining and production operations in various product
segments or regions inside and outside of China. We may strategically pursue acquisitions,
investment in joint ventures and associates, or strategic collaborations to maintain or expand
our operations and our Mineral Resources and Reserves base. Any acquisition, joint venture,
associate or strategic collaboration may change the scale of our business and operations and
may expose us to new geographic, geological, political, social, strategic, operating, financial,
legal, regulatory and contractual risks, including, but not limited to:
 significant changes in commodity prices after we have committed to complete a
transaction and established a purchase price or share exchange ratio;
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 risks arising from historical non-compliance from acquired properties, which we
may not be able to identify in spite of pre-acquisition due diligence;
 mineral ore bodies that may not meet expectations;
 difficulties integrating and assimilating the operations and personnel of any acquired
companies, realizing anticipated synergies and maximizing the financial and
strategic position of the combined enterprise, and maintaining uniform standards,
policies and controls;
 higher costs of integration than we anticipated;
 diversion of management’s attention from our day-to-day business;
 inability to manage the newly acquired entities due to new operating and regulatory
requirements;
 undetected liabilities which may be significant;
 disputes or breaches by our joint venture partners or strategic business partners, or
the inability of our joint venture partners or strategic business partners to fulfil
contractual obligations due to their businesses or financial condition; and
 difficulties in obtaining various governmental approvals and consents.
We may incur losses in relation to our investments in joint ventures and associates. Any
significant investment losses charged against our investments in associates or joint ventures
could have a material adverse effect on our business, financial condition and results of
operations.
In respect of future acquisitions, we may encounter difficulties in integrating acquired
operations, services, corporate culture and personnel into our existing business and operations.
Further, we may discover previously unidentified liabilities or other issues that we did not
discover in our pre-acquisition due diligence investigations. These activities may divert
significant management attention from existing business operations, which may harm our
business. In addition, acquisitions may require our management to develop expertise in new
areas and manage new business relationships. There can be no assurance that any acquisition,
joint venture, associate or strategic collaboration will achieve the results intended. In
particular, if any of the new businesses fail to perform as we expected, we may be required to
recognize a significant impairment charge, which may materially and adversely affect our
business, financial condition and results of operations. There may also be established
competitors in these sectors and markets which enjoy significant market share, and it may be
difficult for us to win market share from them. Furthermore, some of the overseas markets that
we are targeting may have high barriers of entry for foreign companies. There can be no
assurance that our acquisition or expansion plans will be successful.
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Furthermore, there are complex procedures for certain acquisitions of PRC companies as
established by the PRC Anti-monopoly Law (جand the Provisions of
the State Council on the Threshold for the Reporting of Undertaking Concentrations ( ਷ਕ৫
֛which require us to file anti-monopoly applications for
some acquisitions based on the turnover of the acquirer and the target entity. The Provisions
on the Examination of Concentrations of Undertakings (֛was
promulgated SAMR on March 10, 2023 and implemented on April 15, 2023. SAMR is
responsible for conducting the anti-monopoly examination of concentrations of undertakings,
as well as investigating and punishing illegal concentrations of undertakings.
In addition, the PRC Anti-monopoly Law prohibits monopolistic acts include
monopolistic agreements, abuse of a dominant market position and concentration of businesses
that may have the effect to eliminate or restrict competition. The relevant restrictions and
requirements may affect our ability to expand our operations, result in adjustments to our
business plans and limit the growth of our business.
We face industry competition.
We compete with a number of large PRC gold companies and international gold
companies, for further details of our competitors, please refer to “Industry Overview —
Competitive Landscape”. Our competitors may have certain advantages over us, including, for
example, diversified sources of fundings, better financial performance, greater technical and
Mineral Resources, greater economies of scale, broader name recognition and more established
relationships in certain markets. As a result, these competitors may be able to devote more
resources to the discovery of new Mineral Resources and reserves and acquire new Mineral
Resources or other gold mining companies. Competition could also have an adverse impact on
the demand for, and pricing of, our gold products, which in turn affects our business growth
and financial condition. There can be no assurance that we will be able to continue to compete
effectively or maintain or improve our market position. If we fail to compete effectively, it will
have a material adverse effect on our businesses, results of operations and financial condition.
We also face intense competition for the acquisition of attractive gold mining properties.
Industry competition may lessen our opportunities to acquire new Mineral Resources or other
gold mining companies and, ultimately, may have a material adverse impact on our business,
financial condition, results of operations and growth prospects.
We may not be able to meet our estimated gold and other minerals production volume.
Our production estimates are based on, among other things, Ore Reserves estimates, gold
recovery rates, and the assumptions regarding ground conditions and physical characteristics
of Ore Reserves, our mining schedule, utilisation of production facilities, costs of production,
conditions of the industry, political stability and the general economy. There are uncertainties
in our ability to develop sufficient mining flexibility to achieve our mining schedule. Our Ore
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Reserves estimates are based on assumed price of gold and other minerals, and as a result, our
Reserves estimates, production schedule, operation and actual production may be adversely
affected if the actual price of gold and other minerals falls below these gold price assumptions.
Actual production may vary from estimates for a variety of reasons, including risks and
hazards of the types discussed elsewhere in this Prospectus, including, but not limited to:
 actual ore mined varying from estimates in grade, tonnage, and metallurgical and
other characteristics;
 encountering unusual or unexpected geological conditions;
 mining dilution;
 actual gold recovery rate in formal production lower than estimates during the
testing;
 restrictions imposed by government authorities;
 industrial accidents;
 equipment failures;
 natural phenomena such as weather conditions, floods, rock slides and earthquakes;
 changes in the costs of utilities;
 decreases in price of gold and other minerals which may cause Ore Reserves that are
currently economic to become uneconomic;
 labor unrest, strikes or turnover;
 interference from local communities and competitors;
 socio-economic impact; and
 shortages of supplies needed for operation.
Such occurrences could result in damage to mineral properties, interruptions in
production, injury or death to persons, damage to our property or the property of others,
monetary losses and legal liabilities. These factors may cause a mineral deposit that has been
mined profitably in the past to become unprofitable. New mining operations frequently
experience unexpected issues during the initial development phase. Delays can often occur in
the commencement of production. Estimates of production from properties not yet in
production or from operations that are to be expanded are based on similar factors (including,
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in some instances, feasibility studies prepared by our personnel and/or outside consultants), but
it is possible that actual facilities utilisation, gold recovery rate, cash operating costs and
economic returns will differ significantly from those currently estimated. There is no assurance
that we will achieve our production estimates. If we are unable to achieve our production
estimates, this could have a material and adverse effect on our business, financial condition and
results of operations.
We may be materially and adversely affected by challenges relating to slope and stability
of underground openings.
In general, as mining activities continue and expand, underground mines (including ours)
are dug deeper while the waste and tailings deposits increase in size. Under these
circumstances, certain geotechnical challenges may arise, including, for example, the
possibility of failure of the mine’s underground openings or voids. If additional actions are
required to prevent such failure, additional expenses could be incurred, and stated Ore
Reserves could be negatively affected. While we have undertaken industry standard tests,
studies and actions to maintain the stability of our mines and associated waste infrastructure,
adverse conditions may nevertheless take place, and additional actions may be required in the
future.
We may not be able to effectively execute our business strategies. In addition, estimates
relating to expansion projects of existing operations are uncertain and we may incur
higher costs and lower economic returns than estimated.
The ability to grow our business will depend on the successful implementation of our
existing and proposed strategic initiatives, such as to improve productivity, reduce cost and
enhance profitability, and to obtain Resources and Reserves and increase production volume
through acquisitions of high-quality gold assets for robust and sustainable growth. See
“Business — Business Strategies” for further details of our business strategies. The successful
implementation of our strategic initiatives depends upon many factors, including those outside
our control. For example, while we have identified rare earth resources in Laos, the successful
exploration of such rare earth resources will depend on, among other things, our ability to
apply for licenses on trial development to the Laotian Government. We may also prove unable
to deliver on production targets and strategic initiatives. Unforeseen difficulties, delays or
costs may adversely affect the successful implementation of our business strategy and projects,
and such strategy and projects may not result in the anticipated benefits. Any such difficulties,
delays or costs could prevent us from fully implementing our business strategy, which could
have a material adverse effect on our business, financial condition and results of operations.
Our future expansion may place a significant strain on our managerial, operational,
technical and financial resources. In order to better allocate our resources to facilitate our
growth, we must hire, recruit and manage our workforce effectively and implement adequate
internal controls in a timely manner. Our risk management and internal control system may not
be effective or adequate. If we fail to maintain sufficient internal sources of liquidity and
secure external sources of funding for future growth, we may encounter, among other things,
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significant delays in production and operational difficulties. If we are unable to effectively
manage our growth and the associated increased scale of our operations, the efficiency of our
operations, our ability to attract and retain key personnel and our business and prospects could
be materially and adversely affected.
Our operations are exposed to risks in relation to environmental protection and
rehabilitation.
Our operations are subject to extensive environmental laws and regulations in PRC, Laos
and Ghana, including, for example, those relating to waste treatment and disposal, emissions
and water management. Further, we must comply with permits or standards governing, among
other things, land rehabilitation, tailings and waste disposal areas, water use, air emissions,
water discharges, naturally occurring radioactive material, transportation of ore or hazardous
substances, power use and generation, use and storage of explosives, as well as workers’
occupational health and safety. We are required to conduct our mining operations in a manner
that minimizes the impact on the environment, such as through rehabilitation and revegetation
of mined land. In the future, we may have rehabilitation obligations in respect of areas we have
cleared for mining and production purposes. Environmental hazards may occur in connection
with our operations as a result of human negligence, force majeure or otherwise.
Environmental laws and regulations are continually changing and are generally becoming more
stringent. Changes to our environmental compliance obligations or operating requirements
could adversely affect our production cost and revenue.
Further, failure to obtain the required environmental approvals with regard to any of our
operations could affect our environmental management activities including, but not limited to,
tailings disposal facilities and water management projects. For example, the process of
obtaining mining, environmental, and other permits and approvals from the Government of
Ghana has been taking longer lead times and incurring higher costs. As of the Latest
Practicable Date, our Environment Compliance Certificate for LXML issued on January 8,
2024 is valid.
In addition to the above, failure to comply with the conditions thereof, variations in laws
and regulations, assumptions made to estimate liabilities, standards or operating procedures,
more stringent emission or pollution thresholds or controls, or the occurrence of unanticipated
conditions, may require operations to be suspended or permanently closed, and could increase
our expenses and provisions.
There can be no guarantee that non-compliance incidents will not occur at our operations
in the future. The occurrence of any environmental hazards may delay production, increase
production costs, cause personal injuries or property damage, result in liability to us and
damage our reputation. Such incidents may also result in breaches of the conditions for our
mining and exploration licenses or other approvals, permits or authorizations, which may result
in fines or penalties or even possible revocation of such licenses, approvals, permits and
authorizations.
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We may experience increased production costs arising from compliance with
environmental laws and regulations. As the PRC, Laotian and Ghanaian economies develop and
the living standards of the population improve, heightened awareness of environmental
protection may lead to more stringent environmental laws and regulations being implemented
in the future, or the existing environmental laws and regulations may be more strictly enforced.
We may not always be able to comply with future laws and regulations in relation to
environmental protection and rehabilitation economically or at all. Should we fail to comply
with any such laws and regulations, we may be subject to penalties and liabilities, including,
but not limited to, warnings, fines, suspension of production and closure of the relevant facility
that fails to comply with the relevant environmental standards.
Failure to comply with our environmental protection and rehabilitation obligations could
have a material adverse effect on our business, financial condition, results of operations and
prospects.
In addition to compliance with local laws and regulations, our operations are also
increasingly subject to stakeholder expectations concerning the application of stringent
internationally recognized environmental, health and safety and social standards and
benchmarks. Such standards include the World Gold Council Conflict-Free Gold Standard, the
World Gold Council’s Responsible Gold Mining Principles, the International Finance
Corporation Performance Standards and other World Bank guidelines. The application of such
standards could impose significant compliance costs on us. Certain financial institutions from
whom we borrow money may also require compliance with any of these standards the
subsequent deviation from which could prevent or adversely affect our financial condition,
existing financing arrangements and ability to secure future financing.
Any contraventions of environmental statutes may result in compliance and enforcement
action being instituted against us by the relevant authorities, including commencement of
criminal prosecution. Any related expenses and provisions could adversely affect our results of
operations and financial condition.
The failure to comply with these laws and regulations may subject us to the imposition
of significant fines, cessation of mining activities, criminal liability (including prosecution of
our Directors, agents and/or employees in their personal capacities), and risks of litigation.
We may fail to maintain our current financial performance, particularly with respect to
our AISC.
In the mining industry, operations such as enhanced exploration and the initiation of
mining activities, along with fluctuations in labor and raw material costs, and the growing
stringency of environmental regulations, may increase our costs, including both capital cost
and operating costs. For details, please refer to “Appendix IIIB — Competent Person’s Report
for the Sepon Gold and Copper Mine — 20 Project Qualitative Risk Analysis” and “Appendix
IIID — Competent Person’s Report for the Sepon Rare Earth Element and Mengkham Rare
Earth Element Projects in Lao People’s Democratic Republic — 19 Risk Analysis”. While our
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operational efficiency has historically exceeded the global industry average, resulting in a
competitive AISC of US$1,179.1 per ounce as of December 31, 2023, and despite our
successful reduction of AISC by 12.0% in 2023, we cannot guarantee the continuation of this
trend. Our historical AISC performance is not indicative of future results, and the inherent risks
associated with cost management in our industry could materially affect our financial outlook.
Factors beyond our control, such as fluctuations in commodity prices, changes in production
costs, and unforeseen operational disruptions, may lead to an increase in our cost structure.
Any such increase could adversely affect our financial results and market position, potentially
diminishing our comparative advantage in the industry.
Our indebtedness and the conditions and restrictive covenants imposed on us by our
financing agreements could materially and adversely affect our business, financial
condition and results of operations.
As of December 31, 2023 and as of September 30, 2024, our long-term borrowings
amounted to RMB1,640.3 million and RMB1,323.4 million, respectively, which represented
approximately 8.8% and 6.7% of our total assets. For example, GSWL’s outstanding loan
facilities and hedging and guarantee facilities provide creditors with liens on substantially all
of its assets, including the mining lease of GSWL, which may cause risks. Timely payment
under these facilities is important as failure to do so may cause the creditors to foreclose on
and sell substantially all of GSWL’s assets to satisfy payment obligations, which could prevent
us from accessing these assets for our business and conducting our business as planned. Our
business, financial condition, prospects and results of operations could be materially adversely
affected as a result of any of these events. For a detailed outline of our indebtedness, see
“Financial Information — Indebtedness”. This indebtedness could have consequences for our
business and operations including, but not limited to:
 limiting or impairing our ability to obtain financing, refinance any of our
indebtedness, obtain equity or debt financing on commercially reasonable terms or
at all, which could cause us to default on our obligations and materially impair our
liquidity;
 restricting or impeding our ability to access capital markets at attractive rates and
increasing the cost of future borrowings;
 reducing our flexibility to respond to changing business and economic conditions or
to take advantage of business opportunities that may arise;
 requiring us to dedicate a substantial portion of our cash flow from operations to
payments of principal and interest on our indebtedness, thereby reducing the
availability of our cash flow for other purposes;
 placing us at a competitive disadvantage compared to our competitors that have
lower leverage, better financing terms, and/or better access to capital resources;
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 limiting our ability to dispose of assets that secure our indebtedness or utilize the
proceeds of such dispositions and, upon an event of default under any such secured
indebtedness, allowing the lenders thereunder to foreclose upon our assets pledged
as collateral;
 increasing our vulnerability to downturns in general economic or industry
conditions, or in our business; and
 restricting our subsidiaries’ ability to pay dividend to us.
In addition, our bank loan agreements include various conditions and covenants that
require us to obtain the lending bank’s prior consent for certain transactions. We may be
required to comply with similar restrictive covenants or other terms under any new loan and
other financing arrangements in the future. In addition, we are required to comply with various
financial covenants, and new financial covenants may be imposed under any new loan and
other financing arrangements.
Should market conditions deteriorate, or if our operating results were to be depressed, we
may need to request amendments or waivers to the covenants and restrictions under our debt
agreements. There can be no assurance that we will be able to obtain such relief should it be
needed. A breach of any of these covenants or restrictions could result in a default that would
permit our lenders to declare all amounts outstanding thereunder to be due and payable,
together with accrued and unpaid interest, trigger cross-default provisions under other debt
agreements and, as applicable, cause the termination of commitments of relevant lenders to
make further extensions of credit under our financing agreements or credit facilities. If we were
unable to repay our indebtedness to our lenders in such an event, the lenders could, among
other things, proceed against collateral, which could include substantially all of our assets. Our
future ability to comply with financial covenants and other conditions, to make scheduled
payments of principal and interest, or to refinance existing borrowings depends on our business
performance, which is subject to economic, financial, competitive and other factors, including,
but not limited to, the other risks described in this Prospectus. Any failure to comply with the
covenants of our financing agreements or to obtain financing for our business could have a
material and adverse effect on our business, financial condition, results of operations and
prospects. Any failure to make required debt payments could, among other things, adversely
affect our ability to conduct operations or raise capital, which could have a material adverse
effect on our business, financial condition and results of operations.
We may suffer material adverse consequences as a result of our reliance on contractors
to conduct a portion of our business activities.
During the Track Record Period, we outsourced a portion of our exploration, mining and
processing activities to contractors at our PRC, Laos and Ghana operations. For instance, we
outsourced a substantial portion of our engineering work in the PRC, mining and processing
work in our projects in Laos and exploration and drilling services to our operation in Ghana
to qualified contractors, see “Business — Contractors”. As a result, our operations have been
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affected by the performance of these contractors. Our operations at sites utilizing contractors
or contract mining are subject to a number of risks, some that are outside our control,
including, but not limited to, contract risk, execution risk, dispute and litigation risk, regulatory
risk and labor risk, which could result in additional costs and liabilities.
We may not be able to control the quality, safety and environmental standards of the
works conducted by contractors to the same extent as the works conducted by our own
employees. There can be no guarantee that the contractors are in full compliance with all
relevant laws and regulations, which may subject them to suspension of relevant licenses,
approvals, permits and/or authorizations that would adversely and materially impact our
operation. Should this happen, we may not be able to engage replacement contractors on
similar terms or at all in a timely manner. We may become engaged in disputes with our
contractors, which could lead to additional expenses, distractions and potential loss of
production time and additional costs, any of which could materially and adversely affect our
business, financial condition and results of operations. In addition, we may be legally
obligated, as an owner of the exploration permit or mining license, to ensure operational safety.
In the event of any safety-related accident involving a contractor, we may be held directly
liable or liable for compensation to the extent of our faults regardless of any contractual
provisions to the contrary. Any failure by contractors to meet any of our quality, safety and
environmental standards may result in liabilities to us and could also affect our compliance
with government rules and regulations relating to exploration, mining and workers’ safety.
The occurrence of one or more of these risks could have a material and adverse effect on
our business, financial condition and results of operations.
We may not be able to maintain adequate, uninterrupted, timely and specification-
compliant supplies of utilities, materials, equipment and service at commercially
acceptable prices, or at all.
Electricity and water are the main utilities used in our operations. Electricity is used for
most of our business and safety-critical operations, including cooling, hoisting and dewatering.
We obtained electricity from various sources, including, without limitation, local state grid,
licensed state-owned electricity enterprises, local gas-fired power plants and local state
electricity power grid. Any power outage, disruption or shortage in power supply available to
our operations could therefore have a material adverse impact on our production and employee
safety. For instance, since the Wassa Gold Mine in Ghana is subject to extremely high
temperature, an increased electrical power demand may lead to power outages. There may be
incidents of power cuts in certain areas of the PRC, Laos, and Ghana. There can be no
assurance that our production will not be reduced as a result of the power outages. As of the
Latest Practicable Date, all our PRC Mines were underground mines except Jintai Gold Mine
adopting open-pit mining, the Sepon Gold and Copper Mine in Laos uses the combination of
underground mining and open-pit mining, with open-pit mining playing a key role, and the
Wassa Gold Mine in Ghana uses a combination of underground mining and open-pit mining,
where underground mining plays a key role. As such, an interruption of electricity supply will
materially and adversely affect our production and safety by disrupting operations, including
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water pumping and ventilation. In addition, we may be subject to penalties if our consumption
of electricity exceeds the permissible maximum demand pursuant to electricity supply
agreements. Our water supplies are sourced from underground water sources and local water
companies. As of the Latest Practicable Date, all the water permits for our mines were valid.
There can be no assurance that we will be granted extension to our water permits should they
expire, and if not, we will not be able to continue to access the relevant water resources.
Moreover, for certain of our mines that are situated in more remote areas, there can be no
assurance that there will be no interruption in electricity or water.
In addition, we need to compete with other natural resource companies for our overseas
mining operations, and shortage of critical parts and equipment may adversely affect our
operations and development projects. In the event that our existing suppliers cease to supply
us with electricity, water, materials or equipment at commercially acceptable prices or at all,
our operations will be interrupted, and our business, financial condition and results of
operations will be materially and adversely affected.
In addition to utilities, in the PRC, during the Track Record Period we also procured most
of the principal materials used in our production from local suppliers, including, for example,
explosive materials, diesel, sodium cyanide, and cement. In Laos, we procured diesel fuel and
certain low-value consumables from local suppliers, while we procured industrial chemicals
and reagents, explosive materials, equipment maintenance spare parts and other consumables
from overseas suppliers (mainly from PRC suppliers). In Ghana, we procured drilling service
and various materials, such as diesel oil, electricity, certain low-value consumables, bulk
industrial chemicals and reagents, explosive materials, equipment maintenance spare parts and
other major consumables from domestic and overseas suppliers. For more information, see
“Business — Procurement and Suppliers — Suppliers.”
We regularly monitor the fluctuations in market prices for the materials used in our
operations. However, there can be no assurance that such supplies will not be interrupted or
that their prices will not increase in the future. Additionally, if the materials, equipment and
services provided by our suppliers do not meet our requirements or specifications, it may lead
to production disruptions, safety incidents, legal disputes and financial losses. Furthermore, we
may face the risk delay in international procurement. We cannot assure that our suppliers will
not encounter delays during the customs clearance process. Such unforeseen hold-ups can
disrupt our supply chain, potentially leading to production setbacks and increased costs. The
complexity of international logistics, regulatory compliance, and geopolitical factors all
contribute to the inherent uncertainty in the timely delivery of critical components and
materials necessary for our operations. Consequently, any disruption in the flow of goods
across borders could adversely affect our ability to meet market demands and maintain our
competitive edge, which could impact existing profit margins and have a material adverse
effect on our business, financial condition and results of operations.
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We received government grants and enjoyed preferential tax treatment during the Track
Record Period, and any significant reduction in such grants or any adverse change of tax
treatment offered to us may materially and adversely affect our financial condition and
results of operations.
Two of our subsidiaries, namely Wulong Mining and Jilong Mining, were accredited as
High and New Technology Enterprises during the Track Record Period and, therefore, enjoyed
the preferential EIT rate of 15.0%. In support of our R&D projects and mining activities, we
have also recognized income from government grants of RMB1.4 million, RMB4.0 million,
RMB17.0 million and RMB0.8 million for the years ended December 31, 2021, 2022 and 2023
and the nine months ended September 30, 2024, respectively. We are required to renew our
respective accreditations as a High and New Technology Enterprise upon its expiration. While
we do not expect any difficulties in such renewal so long as we meet the applicable
requirements and conditions and adhere to the procedures set forth in the relevant laws and
regulations, there can be no guarantee that we will be granted such extension, and if not, we
will not be able to continue to enjoy the preferential tax treatment for High and New
Technology Enterprises in the future. In addition, there can be no guarantee that the
government grants and preferential tax treatments will continue to be available to us. The
discontinuation of any preferential tax treatment currently available to us will cause our
effective tax rate to increase, which could have an adverse effect on our results of operations.
In addition, the PRC Government from time to time adjusts or changes its policies on business
tax and other taxes. Such adjustments or changes, together with any uncertainties resulting
therefrom, could have an adverse effect on our financial condition and results of operations.
Moreover, as we have substantial overseas operations, we may be subject to the imposition of
additional taxes and royalties due to the complexity of tax laws in different jurisdictions.
We are subject to regulatory risks with respect to our tax compliance.
In the ordinary course of business we may be subject to inquiries, reviews, claims,
assessments or other regulatory actions conducted by relevant tax or revenue authorities in the
jurisdictions in which we operate. We may be subject to additional tax or duty liabilities, or
increased statutory royalties in relation to our mining and mineral production operations, as a
result of any unfavorable decisions made by such relevant tax or revenue authorities, which
may materially and adversely affect our business, financial position and results of operations.
Such regulatory actions may also divert our management’s attention and other resources,
especially if they are not resolved in a timely manner. For example, we carried out certain
intra-group transactions during the Track Record Period, and our profit allocation and income
tax positions in connection with such transfer pricing arrangements are subject to the
interpretations by relevant tax authorities of applicable tax law as well as applicable rules and
regulations with respect to transfer pricing in relevant jurisdictions. There is no assurance that
the respective tax authorities would not challenge the appropriateness of our historical transfer
pricing arrangements or that the relevant regulations or standards governing such arrangements
will not be subject to future changes. If a competent tax authority later determines that the
transfer prices and the transaction terms that we have adopted as well as our historical income
tax provisions and accruals are not appropriate, such authority may require the relevant
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subsidiaries to re-assess the transfer prices and re-allocate the income or adjust the taxable
income. If we are considered not to be in compliance with the applicable transfer pricing rules
and regulations, the relevant tax authority may also have the power to order us to pay all
outstanding tax and statutory interest and/or fines.
Our insurance coverage may be inadequate to satisfy potential claims and fluctuations in
insurance cost and availability could adversely affect our business, financial condition
and results of operations.
Mining, exploration and production activities involve numerous risks, including, for
example, unexpected or unusual geological conditions, fire, floods, earthquakes, severe
weather conditions, other environmental occurrences and political and social instability. These
risks can result in, among other things, damage to and destruction of mining assets or
production facilities, personal injury, environmental harm, financial losses and legal liability.
We maintain insurance for our operations in line with law, regulation and industry
practice in the PRC, Laos and Ghana, including, but not limited to, social insurance for our
PRC employees, directors’ and officers’ liability insurance, medical and accidental injury
insurance of expatriate employees, property insurance, liability insurance (including tailings
insurance), cargo transportation insurance, aircraft operation liability insurance, and
production safety liability insurance. However, in line with industry practice in the PRC, Laos
and Ghana, we have elected not to maintain certain types of insurances, such as business
interruption insurance or key man insurance. In addition, insurance may not continue to be
available at economically acceptable premiums. The costs of maintaining adequate insurance
coverage, most notably property damage insurance and environmental liability insurance, have
increased significantly recently and may continue to do so in the future, thereby adversely
affecting our results of operations. If such costs continue to increase, we may be forced to
accept lower coverage and higher deductibles, which, in the event of a claim, could require
significant, unplanned expenditures of cash and inhibit our ability to maintain our profitability.
In addition, we may become subject to liability against potential claims which we have
not insured, cannot insure or have insufficiently insured, or are unable to insure the amount
needed due to lack of capacity by insurers in the market, including those in respect of past
mining activities. Our insurance may not cover a particular event at all or be sufficient to fully
cover any losses we may incur, including, without limitation, as a result of natural disasters,
public health emergencies and other events that could disrupt our operations, such as
pandemics alike COVID-19. Our existing liability insurance contains exclusions and
limitations on coverage. For example, should we be subject to any regulatory or criminal fines
or penalties, such amounts would not be covered under our insurance program, either due to
exclusions or limitations, or because it is prohibited by legislation in some jurisdictions. As a
result, in the future, our insurance coverage may not cover the extent of claims against it,
including, but not limited to, claims for environmental or industrial accidents, occupational
illnesses or pollution or any cross-claims made.
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We rely on the continued service of our senior management and technically skilled
employees, and we may experience labor shortages, disputes, unrest or strikes.
Our ability to operate or expand effectively depends largely on the experience, skills and
performance of our senior management team and technically skilled employees, particularly
Mr. Wang Jianhua, our Chairman of the Board and Ms. Y ang Yi-fang, our Chief Executive
Officer. We rely on the expertise, experience and leadership of our directors and senior
management. Their extensive knowledge and experience in mining industry, extensive
managerial experience, as well as their established relationships with our customers and their
experience dealing with local government authorities, have played a major role in our
attainments. Additionally, the market for employees with industry experience and technical
skills can be highly competitive. There can be no guarantee that the services of our senior
management and a sufficient number of technically skilled employees in the PRC, Laos and
Ghana will continue to be available to us. If one or more of our senior management and other
key personnel are unable or unwilling to continue to serve in their present positions, we may
not be able to replace them with qualified personnel in a timely manner. Any senior
management departures or unavailability (due to death, injury, illness or other reasons) or
technically skilled worker shortages could adversely affect our operational efficiency and
production levels. We may be unable to hire or retain appropriate management personnel or
technically skilled employees or may have to pay higher levels of remuneration than we
currently project and intend. In particular, qualified personnel may be scarce in some or all of
the regions where our mines are located. If we are unable to hire and retain appropriate
management and technically skilled personnel, or if there are inadequate succession plans in
place, our business may be materially and adversely affected.
In addition, we may be involved in labor disputes and experience labor unrest or strikes
in the ordinary course of our business. During the Track Record Period, we had been involved
in certain labor disputes, including termination of employment agreements, work-related injury
compensation, etc. There can be no guarantee that labor disputes, unrest or strikes will not
occur in the future. In the event that we experience such incidents, our mining activities and
production levels may be disrupted, which may have a material and adverse effect on our
business, financial condition, results of operations, reputation and future prospects.
Any negative publicity regarding our Company, Directors, employees or products,
regardless of its nature or veracity, could adversely affect our business.
As an established brand, our image is sensitive to the public’s perception of us as a
business in entirety, which includes not only the quality of our products, but also our corporate
management and culture. We cannot guarantee that no one will, intentionally or incidentally,
disseminate information about us, including the quality of our products, our internal
management matters and negative information for management, that may result in negative
perception of us by the public. Although we had promptly taken clarification or rectification
measures when we faced negative publicity in the past, we cannot assure you that such
measures will always be effective in the future. In addition, as a listed company, our Company
and member of our management or employees are under the supervision of securities
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regulatory bodies and in the past, we were subject to certain regulatory inquiries and penalties.
Any negative publicity about our Company, Directors, employees, spokespersons or products,
regardless of nature or veracity, could lead to potential loss of customers or investors’
confidence or difficulty in retaining or recruiting talents that are essential to our business
operations. As a result, our business, financial condition, results of operations, reputation and
prospects may be materially and adversely affected.
Natural disasters, epidemics, acts of war or terrorism or other factors beyond our control
may have a material adverse effect on our business, financial condition and results of
operations.
Natural disasters, epidemics, acts of war or terrorism or other factors beyond our control
may adversely affect the economy, infrastructure and livelihood of the people in the regions
where we conduct our business. For example, our operations may be under the threat of flood,
earthquake, sandstorm, snowstorm, fire or drought, power, water or fuel shortages, critical
equipment failures, malfunction and breakdown of information management systems,
unexpected maintenance or technical problems, or are susceptible to epidemics, potential wars
or terrorist attacks. Serious natural disasters may result in loss of lives, injury, destruction of
assets, reduction in our productivity and/or disruption of our business and operations. Severe
communicable disease outbreaks (such as COVID-19) could result in a widespread health crisis
that could materially and adversely affect the economy and financial markets. Acts of war or
terrorism may also injure our employees, cause loss of lives, disrupt our business network
and/or destroy our markets. Any of these factors and other factors beyond our control could
have an adverse effect on the overall business sentiment and environment, cause uncertainties
in the regions where we conduct business, cause our business to suffer in ways that we cannot
predict and materially and adversely impact our business, financial condition and results of
operations.
The physical impacts of climate change and relevant regulations may adversely affect our
mining operations, workforce and supply chain.
Our operations, workforce and supply chain may be exposed to a number of physical risks
posed by climate change, such as changes in rainfall rates or patterns, rising sea levels, reduced
water availability, higher temperatures and more frequent extreme weather events. For
example, from time to time our operations in Ghana may be adversely affected by severe
weather conditions as its climate, terrain and vegetation are conducive to naturally occurring
fires. Such potential physical impacts of climate change on our operations are highly uncertain
and would vary by operation based on particular geographic circumstances. As a result, we may
face increased operational costs associated with, for example, power and supply chain
disruption, delays and increased pricing. In addition, the potential for overall decreases in
precipitation could affect the availability of water needed for our operations, leading to
increased operating costs, or in extreme cases, disruptions to mining operations. In addition,
our operations could be exposed to a number of physical risks from climate change, such as
changes in rainfall rates or patterns, reduced water availability, higher temperatures and
extreme weather events. Such events or conditions, including, for example, flooding or
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inadequate water supplies, could disrupt mining and transport operations, mineral processing
and rehabilitation efforts, create resource or energy shortages or damage our property or
equipment and increase health and safety risks on site. Such events or conditions could have
other adverse effects on our workforce and on the communities around our mines, such as an
increased risk of food insecurity, water scarcity and prevalence of disease, all of which could
have a material adverse effect on our results of operations and financial condition. Each of
these potential physical impacts of climate change could disrupt our operations and have a
materially adverse effect on our business, financial condition and results of operations.
Our operations may also be affected by climate change regulations. Greenhouse gases are
emitted by our operations as a result of fuel and energy consumption. While our operations are
not presently subject to specific regulatory measures to address or limit greenhouse gas
emissions, the relevant governments in the jurisdictions we operate may be bound by
international or local climate change treaties, for example, the Ghanaian Government ratified
the 2015 UN Framework Convention on Climate Change (also known as the Paris Agreement).
As regulatory requirements in respect of climate change evolve, compliance may require
additional costs and involve other unexpected effects, which could have a material adverse
effect on our operations, financial condition and results of operations. As producing gold is an
energy-intensive business, transitioning to a lower-carbon economy will require significant
investment and may entail extensive policy, legal, technology, and market changes to address
mitigation and adaptation requirements related to climate change.
Maintaining and increasing compliance of industry standards and keeping sufficient ESG
disclosure to maintain our reputation and care for local communities could increase our
operation costs.
The continued success of our existing operations and future projects are in part dependent
upon broad support of and a healthy relationship with the local communities in which our
operations are located, in addition to conducting operations in a manner that is not detrimental
to the environment. While formal permission to operate is ultimately controlled by host
governments, many mining activities require social permission from host communities and
influential stakeholders to carry out operations effectively, sustainably and profitably.
The consequences of negative community reaction could therefore give rise to material
reputational damage which can pose obstacles to our ability to develop our projects and
maintain our operations, and have a material adverse impact on the cost, profitability, ability
to finance or even the viability of an operation. If our operations are delayed or shut down as
a result of political and community instability, our earnings may be constrained and the
long-term value of our business could be adversely impacted. Even in cases where no action
adverse to us is actually taken, the uncertainty associated with such political or community
instability could negatively impact the perceived value of our assets and mining investments
and, consequently, have a material adverse effect on our financial condition. In order to
maintain our social license to operate, we may need to design or redesign parts of our affected
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mining operations to minimize their impact on the relevant communities and the environment,
either by changing mining plans to avoid such impact, by modifying operations, by changing
planned capital expenditures, or by relocating the affected people to an agreed location.
Specifically, some of our current and potential mining activities are or may be located in
or near communities that may regard such operations as having a detrimental effect on their
safety or environmental, economic or social circumstances. It has become common in Laos and
Ghana for communities surrounding mines to look to the mines to improve standards of living
in the area. Such communities may engage in protest action, which may affect access to the
mine and production.
For example, the local regulations and MEPA between mining right holders and
government stakeholders in Laos stipulate that every mining right holder is required to promote
local employment, advance social and economic welfare, contribute to transforming the mining
industry and ensure that mining companies contribute to the development of the areas where
they operate. In Ghana, the Minerals and Mining (Local Content and Local Participation)
Regulations, 2020 (L.I. 2431) was passed to promote, prioritize, and facilitate local content and
local participation in the entire mining sector value chain. The regulations came into force on
December 22, 2020 and seek to achieve this by stipulating requirements for registration and
approval by the Minerals Commission of Ghana of localization program of holders of mineral
rights and service providers in the mining industry. The regulations also seek to promote the
utilisation of local goods and services by reserving certain specified services to only Ghanaian
citizens or Ghanaian owned companies which are registered with the Minerals Commission of
Ghana. Failure to comply with the social obligations could have a material and adverse impact
upon our operations and may result in the suspension and/or cancellation of the environmental
certificate and the corresponding suspension or stoppage of project implementation and
activities.
Also, action is increasingly taken by members of the general financial and investment
communities, such as asset managers, sovereign wealth funds, public pension funds,
universities and other groups, to promote improvements in ESG performance by mining
companies, which may impact our ability to raise funds if are perceived to have ESG
deficiencies. V oluntary compliance with gold industry standards and reporting against multiple
sustainability and ESG indices could result in significant costs. Stringent standards relating to
responsible gold, including but not limited to the World Gold Council Conflict-Free Gold
Standard and the World Gold Council Responsible Gold Mining Principles have been
introduced. Additionally, the increasing demand for disclosure on performance with regard to
ESG and the plethora of disclosure formats and indices being demanded, may result in
significant costs to ensure and demonstrate compliance (particularly where standards change
rapidly or duplication in reporting is required).
The cost of measures and other issues relating to the sustainable development of mining
operations has placed significant demands on our resources and could increase capital and
operating costs and have a material and adverse impact on our reputation, business, financial
condition and results of operations.
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The failure of a tailings storage facility could negatively impact our business, reputation
and results of operations.
Mining companies face inherent risks in their operation of tailings storage facilities.
Tailings storage facilities are structures designed and managed to contain fine mining waste,
known as “tailings”. Tailings are a by-product of mining, consisting of the processed rock or
soil left over from separating the commodities of value from the rock or soil within which they
occur. However, the use of tailings storage facilities exposes us to certain risks that could be
detrimental to operations, the environment, and/or public health and safety that may arise from
some present process or future event. Tailings storage facilities designed as upstream raised
facilities may present greater risk, particularly where the facility is located in a high seasonal
rainfall area or an area of high seismic activity. When tailings storage facilities fail, the
consequences can be catastrophic for communities, local economies and the surrounding
environment. The occurrence of a dam failure at one of our tailings storage facilities could also
lead to the loss of human life and/or extensive property and permanent environmental damage,
leading to the need for a large expenditure on contingencies and on recovering the regions and
people affected, and the payment of penalties, fines or other monetary damages.
Tailings facilities are in a near-constant state of change, from initial construction, during
operations and until closure. This presents a significant challenge in reviewing and assessing
their safety, requiring a multi-faceted program with multiple levels of safety assessment in
order to be effective. We maintain measures to manage our dams’ safety, including compliance
with the International Council on Mining and Metals’ Tailings Governance Position Statement,
adoption of new safety measures, and undertaking routine reviews by independent international
consulting companies. However, there can be no guarantee of the effectiveness of our designs,
the construction quality of the tailings storage facilities, or that any monitoring throughout of
the operations of the tailings storage facilities will identify any safety concerns. Nor can there
be any guarantee that any of the measures that have been put in place to safeguard our tailings
storage facilities will prevent the failure of one or more of them, or that such potential failure
will be detected in advance. We also cannot guarantee that our operating partners maintain
similar safety precautions or monitoring systems on their tailings storage facilities.
The failure of a dam at a tailings storage facility could lead to multiple legal proceedings
and investigations, which could include class action lawsuits, criminal proceedings and public
civil actions (against our Company, any of its subsidiaries and/or individuals) for significant
amounts of damages.
As a result of any dam failures, additional environmental, health and safety laws and
regulations may be forthcoming globally, including in jurisdictions where we operate, which
may ban or curtail any storage of wet tailings or the construction or use of upstream tailings
storage facilities. In addition, changes in industry standards, laws and regulations may impose
more stringent conditions in connection with the licensing process of projects and operations
and increased criminal and civil liability for companies, officers and contractors. For example,
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on August 5, 2020, the International Council on Mining and Metals (ICMM), the United
Nations Environment Programme (UNEP) and the Principles for Responsible Investment (PRI)
established an international tailings standard, the Global Industry Standard on Tailing
Management (GISTM).
The occurrence of any of the above mentioned such risks could have a material and
adverse effect on our business, financial condition and results of operations.
Our existing mining operations have a finite life and eventual closure of our operations
will entail costs and risks regarding on-going monitoring, rehabilitation and compliance
with environmental standards, which may exceed the provisions we have made.
Despite our efforts in identifying and acquiring additional resources in the areas
surrounding our existing mines and other regions in the PRC and abroad, our existing mining
operations have a finite life and will eventually close. The key costs and risks for mine closures
relate to (i) long-term management of permanent engineered structures, (ii) achievement of
environmental remediation, rehabilitation and closure standards (including the assessment,
funding and implementation of post-closure polluted and extraneous water pumping treatment),
(iii) orderly retrenchment of employees, and (iv) relinquishment of the site with associated
permanent structures and community development infrastructure and programs to new owners.
Please also see “Appendix IIIB — Competent Person’s Report for the Sepon Gold and Copper
Mine — 20 Project Qualitative Risk Analysis”. The successful completion of these tasks is
dependent on our ability to successfully implement of closure plan agreed with the relevant
government authorities, community and employees. Any issues relating to the closure of mines
in accordance with their closure plans may increase closure costs and result in handover delays,
damage to our reputation if a desired outcome cannot be achieved, as well as give rise to
potential liabilities if the relevant mines fail to meet the relevant closure standard or if a
post-closure accident or environmental incident occurs, all of which could materially and
adversely affect our business and results of operations.
We cannot guarantee that we will not be involved in claims, disputes and legal
proceedings in our ordinary course of business.
From time to time, we may be involved in claims, disputes and legal proceedings in our
ordinary course of business. These may concern issues relating to, among others, health and
safety accidents, environmental matters, breach of contract, employment or labor disputes and
infringement of intellectual property rights. As of the Latest Practicable Date, we were not
involved in any litigations and legal proceedings in the PRC, Laos and Ghana that may
materially affect our business and results of operations. If we are found liable on any of the
claims, we would have to incur a charge against our current earnings to the extent that a reserve
had not been established for the matter in our accounts, or to the extent the claims were not
sufficiently covered by our insurance coverage. Claims brought by us against our customers
may include claims for additional costs incurred in excess of current contract provisions arising
out of delays and changes in the initial scope of work. Both claims brought against us and by
us, if not resolved through negotiation, are often subject to lengthy and expensive litigation or
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arbitration proceedings. Amounts ultimately realized from our customers or other claims by us
could differ materially from the balances included in our financial statements, resulting in a
charge against earnings to the extent profit has already been accrued on a project or other
contract. Charges associated with claims brought against us and write-downs associated with
claims brought by us could have a material adverse impact on our businesses, financial
condition, results of operations and cash flow. Moreover, legal proceedings resulting in
judgments or findings against us may harm our reputation and damage our prospects to secure
contracts in the future.
We may not be able to detect and prevent fraud, bribery, other unfair business practices
or other misconducts committed by our employees or third parties, and any actual or
alleged misconduct may lead to censure, penalties, fines, sanctions, loss of licenses or
permits and may negatively impact our reputation.
We operate globally in multiple jurisdictions and with numerous and complex legal
frameworks, applicable rules, codes and standards, and our governance and compliance
framework and implemented processes may not always prevent potential breaches of law or
accounting or other governance practices. Some of the jurisdictions where we operate may be
considered high-risk from an anti-bribery and anti-corruption perspective, and strict
compliance with anti-bribery and anti-corruption laws may conflict with local customs and
practices. We may be exposed to fraud, bribery, other unfair business practices or other
misconducts committed by our employees or third parties that could subject us to financial
losses and sanctions imposed by governmental authorities, which may adversely affect our
reputation. Our internal control procedures are designed to monitor our operations and ensure
overall compliance. However, we cannot assure you that our internal controls, policies and
procedures are all the times adequate to protect us from improper conducts by our officers,
directors, employees, representatives, third-party intermediaries, business partners or agents.
In the event that we believe or have reason to believe that any such party has or may have
violated such laws, we may investigate (or have outside counsel investigate) the relevant facts
and circumstances. Detecting, investigating and resolving actual or alleged violations can be
expensive and require a significant diversion of time, resources and attention from senior
management. Furthermore, it is not always possible to detect and prevent fraud, bribery, unfair
business practices and other misconducts, and the precautions we take to detect and prevent
such activities may not be effective. There can be no assurance that fraud, bribery, or other
misconduct will not occur in the future. If such fraud, bribery, unfair business practices or other
misconducts does occur, it may cause negative publicity and damage our reputation as a result.
The occurrence of any of these events could have a material adverse effect on our
business, financial condition and results of operations.
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We are exposed to credit risk in relation to defaults of our trade counterparties.
During the Track Record Period, we had trade receivables primarily relating to our sale
of gold, copper cathode and the concentrate mineral powder of copper, lead and zinc. As of
December 31, 2021, 2022 and 2023 and nine months ended September 30, 2024, our trade
receivables from comprehensive recycling of resources business amounted to RMB311.4
million, RMB339.2 million, RMB397.5 million and RMB347.2 million, respectively, and our
trade receivables from other sales amounted to RMB25.3 million and RMB29.6 million,
RMB115.7 million and RMB240.0 million, respectively. Our trade receivables turnover days
31 days, 21 days, 22 days and 25 days for the periods ended December 31, 2021, 2022 and 2023
and the nine months ended September 30, 2024, respectively. We have implemented a customer
credit assessment system to evaluate the creditworthiness and financial condition of our
customers. There can be no assurance that all of our counterparties are creditworthy and
reputable and will not default on us in the future, despite our efforts to conduct credit
assessments on them. In addition, our sales contracts with customers allow them to terminate
the contracts upon the occurrence of certain events. There is limited financial or public
information on many of our counterparties, and as a result, we are exposed to risks that our
counterparties may fail to fulfil their obligations to us under our contracts.
We face high concentration of customers during the Track Record Period and the loss of
one or more of these customers could adversely affect our business, financial condition,
and results of operations.
Due to the nature of our business and industry norm, we have a limited customer base and
face high concentration of a small number of customers for a significant portion of revenues.
During the Track Record Period, our top five customers were refiners of precious metals and
other non-ferrous metals as well as trading companies. For each year/period of the Track
Record Period, revenue contributed by our top five customers amounted to RMB2,946.2
million, RMB5,345.8 million, RMB5,565.6 million and RMB4,904.6 million, respectively,
accounting for 77.9%, 85.4%, 77.1% and 78.8% of our total revenue for the same periods,
respectively. For each year/period of the Track Record Period, revenue contributed by our
largest customer, which is a global large-scale precious metal assayer, refiner and mint,
amounted to RMB2,126.6 million, RMB2,602.2 million, RMB2,672.1 million and
RMB2,140.3 million, respectively, accounting for 56.2%, 41.5%, 37.0% and 34.4% of our total
revenue for the same periods, respectively. Although there are readily available customer and
a diversified customer portfolio to mitigate potential customer attrition, we cannot assure that
our business will be unaffected by changes in our customer composition. Shifts in our customer
base may significantly impact our revenue and profitability, particularly in the event of a
reduction or termination of business with key customers.
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We are subject to risks related to our various financing activities, such as hedging
activities. We also face exposure to fair value change. Fluctuations in fair value of our
financial assets at FVOCI and derivative financial instruments would adversely affect our
financial results.
During the Track Record Period, we entered into gold leasing contracts, in which we
leased gold from commercial banks to supplement our working capital. We usually enter into
forward contracts under which we agree to purchase the same amount of gold, at the same price
and on the maturity date of the gold leasing contracts to repay the leased gold (as well as
payment of the leasing fees) to effectively hedge our position under gold leasing contracts.
Hedging instruments, such as gold forward sales contracts, were utilized during the Track
Record Period to lock up part of our future gold sales revenue in view of the volatility in gold
price. There can be no assurance that the use of hedging techniques will always benefit us.
Gold hedging instruments may prevent us from realizing the full benefit of potential
subsequent increases in the gold price, which would cause us to record a mark-to-market loss
in the consolidated income statements.
The fair value of these transactions is recorded as financial liabilities at fair value through
profit or loss in our consolidated statement of financial position. We recorded the gains or
losses from, and fair value changes of, these transactions as other gains or as finance costs in
our consolidated statement of profit or loss. We recorded fair value loss on gold leasing
contracts at RMB3.1 million, RMB30.4 million, RMB63.4 million and RMB83.3 million in
2021, 2022, 2023 and for the nine months ended September 30, 2024, respectively.
Changes in gold price may affect the effectiveness of our hedging and gold leasing
contracts. Gold price has been fluctuating in the global market and we will continue to assess
whether to enter into further hedging or gold leasing activities. In addition, our business,
financial condition and results of operations could be materially and adversely affected if for
any reason our gold production is unexpectedly interrupted and, as a result, we are unable to
produce sufficient gold to cover any hedging or gold leasing contracts that we have entered
into. There is also a risk that the counterparty to any hedging transaction could default on its
obligations. Without hedging transactions, we may not be able to lock in our selling price when
the gold price decreases, which may reduce the revenue that we may receive. Moreover, we
may experience cash flow problems if we do not continue to, or are unable to, engage in gold
leasing.
Any of the above could have a negative impact on our business, financial condition and
results of operations.
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We may incur impairment losses related to our mining rights and related assets, which
may adversely affect our results of operations.
Based on our accounting policy, our subsurface use rights are amortized using the
production method, based on proven and probable reserves, from the time of the beginning of
ore mining. The process of Reserve estimate is inherently uncertain and complex and requires
significant judgments and decisions based on available geological, engineering and economic
data. If the value of our mining rights is over-estimated, the over-estimated amounts will be
recognized as impairment losses, which in turn may have a material adverse effect on our result
of operations. The carrying amount of the property, plant and equipment, including exploration
and evaluation assets, is tested by us for impairment whenever facts and circumstances indicate
assets’ impairment in accordance with our accounting policy. Any material decrease of our
Reserve may result in impairment on the carrying value of our mining rights and related assets,
and this may have a material adverse effect on our business, financial condition and results of
operations.
We are exposed to the risk of obsolescence and impairment of our inventory.
Our inventories primarily consist of raw materials, work-in-progress, finished goods and
consumable materials. While our work-in-progress and finished goods are not exposed to the
risk of obsolescence since they do not deteriorate easily, we made provision for write-down of
inventories for certain low-value consumption goods. When the carrying amount of inventories
is greater than their net realizable value at the end of a period, we will write down our
inventory to net realizable value and record a provision of write-down of inventories. Our
provision for write-down of inventories decreased from RMB298.7 million as of December 31,
2021 to RMB250.1 million as of December 31, 2022 and decreased to RMB190.9 million as
of December 31, 2023, and increased to RMB196.1 million as of September 30, 2024.
Assumptions regarding gold price and recovery rate will have impact on the assessment of the
value of our inventories.
We have been actively managing our inventory to effectively plan our production to avoid
stocking out and to minimize the risk of obsolescence of our inventory. Maintaining inventory
at a proper level due to various factors, including but not limited to delivery delay, product
quality not meeting standard, may result in interruptions in our production, failure to achieve
anticipated production expansions, excessive purchases, etc. Excessive inventory on hand may
increases the risk of inventory obsolescence, we may need to either sell off such inventory at
a lower price to third parties or write off such inventory, in the event of which our financial
condition and results of operations may be adversely affected.
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We rely on information technology and communications systems, the failure of which may
significantly and adversely impact our operations and business.
We rely on our information technology and communications systems, such as our
transportation monitoring and GPS system, toxic gas monitoring system, underground
personnel locating system, and office approval and financial reporting system. These systems
are vital to our operations. Our information technology and communications systems could be
exposed to, among other things, damage or interruption from telecommunications failure,
unauthorized entry and malicious computer code, fire, natural disaster, power loss, industrial
action and human error. While we have backup systems in place, the occurrence of any of the
above may also disrupt our information technology and communications systems and may lead
to important data (including, for example, geophysical and geological data) being irretrievably
lost or damaged.
Such damage or interruption may adversely affect our business, financial condition and/or
results of operations.
We could be adversely affected as a result of any sales we make to certain countries that
are, or become subject to, sanctions administered by the United States, the European
Union, the United Kingdoms, the United Nations, Australia and other relevant sanctions
authorities.
The United States and other jurisdictions or organizations, including the European Union,
the United Kingdom, the United Nations and Australia, have, through executive order,
legislation or other governmental means, implemented measures that impose economic
sanctions against certain countries or against targeted industry sectors, groups of companies or
persons, and/or organizations within such countries. Sanctions laws and regulations are
constantly evolving, and new persons and entities are regularly added to the lists of sanctioned
persons. We cannot provide any assurance that our future business will be free of sanctions risk
or our business will conform to the expectations and requirements of the authorities of the
United States or any other jurisdictions. Our business and reputation could be adversely
affected if the authorities of the United States, the European Union, the United Kingdom, the
United Nations, Australia or any other jurisdictions were to determine that any of our future
activities constitutes a violation of the sanctions they impose or provides a basis for a sanctions
designation of us.
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We are subject to anti-corruption, anti-bribery, anti-money laundering, financial and
similar laws, and non-compliance with such laws can subject us to administrative, civil
and criminal fines and penalties, collateral consequences, remedial measures and legal
expenses, all of which could adversely affect our business, results of operations, financial
condition and reputation.
We are subject to anti-corruption, anti-bribery, anti-money laundering, financial and
export control regulations and similar laws and regulations in various jurisdictions in which we
conduct activities, including the U.S. Foreign Corrupt Practices Act, or FCPA, the U.K. Bribery
Act 2010, and other anti-corruption laws and regulations. If we fail to comply with
anti-corruption, anti-bribery, anti-money laundering, financial and export control regulations
and similar laws and regulations, we could be subject to whistleblower complaints, adverse
media coverage, investigations, and severe administrative, civil and criminal sanctions,
collateral consequences, remedial measures and legal expenses, all of which could materially
and adversely affect our business, results of operations, financial condition and reputation. Any
violation or even an alleged or suspected violation could harm our reputation and cause our
suppliers, customers, financial institutions or other counterparties to refuse to do business with
us, which may negatively affect our business, our results of operations, or the trading price of
our Shares.
Our risk management and internal control systems may not fully protect us against
various risks inherent in our business.
We have established risk management and internal control systems consisting of the
relevant organizational framework policies, risk management policies and internal control
procedures to manage our risk exposures, primarily our operational risk, legal risk and liquidity
risk. However, during the Track Record Period, there were deficiencies in our internal control
and corporate governance measures in relation to anti-fraud management, procurement
management, transfer pricing management, HR management, and payment control. We need to
continuously improve our internal control systems and fix such deficiencies, failure of which
may cause losses from both a financial perspective and regulatory perspective. Moreover, we
may not be successful in implementing our risk management and internal control systems.
While we seek to continue to enhance such systems from time to time, there can be no
assurance that our risk management and internal control systems are adequate or effective
notwithstanding our efforts, and any failure to address any potential risks and internal control
deficiencies could materially and adversely affect our business, financial condition and results
of operations.
Since our risk management and internal control systems depend on their implementation
by our employees, there can be no assurance that all of our employees will adhere to such
policies and procedures, and the implementation of such policies and procedures may involve
human errors or mistakes. Moreover, our growth and expansion may affect our ability to
implement stringent risk management and internal control policies and procedures as our
business evolves. If we fail to timely adopt, implement and modify, as applicable, our risk
management and internal control policies and procedures, our business, financial condition and
results of operations could be materially and adversely affected.
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Share-based compensation expenses may cause shareholding dilution to our existing
Shareholders and have a material and adverse effect on our financial performance.
We have adopted a share incentive plan for the benefit of our directors, senior
management and key employees as remuneration for their outstanding services provided to us
to incentivize and reward eligible persons who have contributed to our success. To further
incentivize our directors, senior management and key employees to contribute to us, we may
grant additional share-based compensation in the future. Issuance of additional Shares with
respect to such share-based payment may dilute the shareholding percentage of our existing
Shareholders. Expenses incurred with respect to such share-based payment may also increase
our operating expenses and, therefore, have a material and adverse effect on our financial
performance.
RISKS RELATING TO DOING BUSINESS IN LAOS AND GHANA
Economic, political or social instability and security risks as well as shifts in political and
social attitudes affecting Laos and Ghana may have a material adverse effect on our
operations and profits.
We generate a substantial amount of gold and copper production from Laos and Ghana,
representing 42.3% and 29.6% of our revenue in 2023, respectively. As a result, changes or
instability affecting the economic, political or social environment in Laos and Ghana or in
neighboring countries could materially and adversely affect our operations and profitability.
The Laotian and Ghanaian environments are subject to changes in a manner that may be
materially adverse to us, including changes to government policies and regulations governing
mining production, foreign investment, price controls, import and export control, tariffs,
subsidies, income and other forms of taxation (including policies relating to the granting of
advance rulings on taxation matters), nationalization or expropriation of property, repatriation
of income, royalties, the environment and health and safety.
In Laos and Ghana, we are exposed to a greater than average risk of overt or effective
expropriation or nationalization. For example, under the Minerals and Mining Act, the
Ghanaian Minister of Lands and Natural Resources has the right of pre-emption over all
minerals obtained in Ghana and products derived from the refining or treatment of these
minerals. On July 31, 2018, the Minister of Lands and Natural Resources informed the
Ghanaian Chamber of Mines of their intention to exercise their right of pre-emption to acquire
up to 20% of all gold mined in Ghana for the benefit of Ghanaian refineries. In November
2022, the Ghanaian Government directed all gold mining companies, effective January 2023,
to sell up to 20% of their produce to the Bank of Ghana at the World Market Spot Price in
Ghanaian Cedis.
In recent years, major rating agencies have lowered or maintained a relatively low
sovereign credit rating of Laos and Ghana. Downgrading, or the expected downgrading, of
Laos and Ghana’s sovereign credit ratings to non-investment grade status by major credit rating
agencies have caused a loss of investor confidence and resulted in widening credit spreads,
increased credit losses and tighter credit conditions, which have generally adversely affected
the overall Laotian and Ghanaian economies, as well as their respective gold mining industries.
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Given that we operate in these jurisdictions, our business, financial condition and results of
operations may be adversely affected, as it may be more difficult for us to secure external
financing and, where such external financing is secured, may be at greater borrowing costs and
on more restrictive terms.
In addition, there are difficult security environments in both Laos and Ghana as a result
of high levels of unemployment, inflation and poverty in the countries. Significant security
challenges remain in areas where we have operations, and we may experience instances of
injury to security personnel, including members of our internal security and third-party security
providers we engage, from time to time. Any such instances could disrupt our operations and
adversely affect our reputation, results of operations and financial condition.
There is also a skills deficiency across many sectors in Laos and Ghana, including the
mining industry, and we face intense competition from other mining companies. As a result, we
may have difficulty attracting and retaining key employees at all levels with the appropriate
technical skills and operating and managerial experience necessary to operate and supervise the
different parts of our business. There has also been regional political and economic instability
and civil unrest in certain of the countries surrounding Laos and Ghana. Any similar political
or economic instability or other uncertainty in Laos and/or Ghana could have a negative impact
on our business operations and our financial performance.
Financial and securities markets in Laos and Ghana are influenced by global economic
and market conditions. Laos and Ghana’s economies remain vulnerable to external shocks,
including those relating to, or similar to, the global financial crisis of 2007-2008 and the
uncertainties surrounding the Asia-Pacific and the Sub-Saharan Africa regions. Although
economic conditions vary from country to country, investors’ perceptions of events occurring
in one country may substantially affect capital flows into and investments in securities in other
countries. In particular, each of Laos and Ghana’s economy is also vulnerable to adverse
developments affecting its principal trading partners. Deterioration of the economies of their
major trading partners, such as the PRC or the United States, could have a material adverse
impact on Laos’ and Ghana’s balance of trade and adversely affect Laos’ and/or Ghana’s
economic growth and may consequently adversely affect the financial condition and results of
operations of LXML and GSWL. Consequently, there can be no assurance that the Laotian and
Ghanaian financial system and securities markets will not continue to be adversely affected by
events in other regional economies or markets, which could, in turn, adversely affect the
Laotian and/or the Ghanaian economy and, as a consequence, the financial condition and
results of operations of LXML and GSWL.
In addition, economic and political instability in regions outside of the jurisdictions where
we operate and geopolitical events, such as the political instability in Myanmar which is a
neighboring country to Laos, the war and war refugees emerging in the area north of the
boundary of Ghana, the Russo-Ukrainian War and Israeli-Palestinian conflict, may result in
unavoidable uncertainties and events. These uncertainties and events could negatively affect
costs of business, cause volatility in commodity prices, currency exchange rates, interest rates
and worldwide political, regulatory, economic or market conditions. They could also cause
instability in political institutions, regulatory agencies and financial markets.
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Occurrence of any of the above-mentioned developments could result in our operations
experiencing opposition or disruptions. Such opposition or disruption to any of our operations,
in particular if it has an adverse impact or cost or causes any stoppages (including, for example,
as a result of any protests aimed at government and other mining operations that affect
operations), could have a material and adverse effect on our business, financial condition and
results of operations.
It may be difficult for the Hong Kong regulators to obtain information or call for
regulatory assistance in Laos where circumstances necessitate in the course of overseeing
us as a listed company by the regulations in Hong Kong.
Our Directors and us, which will be regulated by the SFO and other applicable laws and
regulations in Hong Kong upon the Listing, shall be required to provide the SFC with all
information relating to our business in Laos that is necessary for its investigation of our affairs
as may be required under Hong Kong laws or regulations. However, as the Laos has not signed
any regulatory cooperation agreement or memorandum of understanding with the SFC or the
Hong Kong Stock Exchange, nor is it a member of the International Organization of Securities
Commissions (the “ IOSCO ”) or a signatory to the IOSCO Multi-lateral Memorandum of
Understanding (the “ IOSCO MMOU ”), it may be difficult for the Hong Kong regulators to
obtain information or call for regulatory assistance in Laos where circumstances necessitate in
the course of overseeing us as a listed company by the regulations in Hong Kong.
Although we continue to grow our operations in our core markets and expand our
presence into further global jurisdictions, we will continuously monitor our local business
operations and business expansion rate in Laos on an ongoing basis. Our management will also
report periodic information of the revenue generated by our operating entities in Laos to our
Board of Directors. We will take necessary steps with respect to access to our Laotian operating
entities’ books and records and fully cooperate with regulatory requests in order to facilitate
the Hong Kong Stock Exchange and the SFC’s access to information of these operating entities
based abroad.
Our business and operations may be adversely affected by union activity and new and
existing labor laws.
Our employees in Ghana are highly unionized, and unions hence have a significant impact
on the general labor relations environment. Trade unions are active in Ghana and advocate for
improved conditions of employment and change to labor regulations, and to promote various
political and social goals by using their collective power and ability to withhold labor. The
broader labor relations climate also remains fragile in Ghana.
In Laos, while employees are not highly unionized, unions are maintained within large
organizations and recognized at the organization, provincial and district level, and are
organized under the Lao Federation of Trade Unions.
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Therefore, union involvement in wage negotiations and collective bargaining increases
the risk of strike action and rising labor costs. Wage negotiations in other industries and other
mining sectors may influence the stance unions take toward the industry in which we operate.
Our employees might exercise their right to strike within the ambit of the legislations,
such as the Labor Law of the Lao People’s Democratic Republic and Ghanaian Labor Act, 2003
(Act 651), and in which case, it could have a material and adverse effect on both our business
and reputation, and the operation of our mines could be disrupted. Our employees might
exercise their right to strike per the relevant local laws and regulations, and, in such case, it
could have a material and adverse effect on both our business and reputation, and the operation
of our mines could be disrupted.
We may be exposed to various diseases or public health emergency that result in loss of
productivity and increased costs.
In Ghana and Laos, we face the potential risk of various contagious diseases, including
tuberculosis, yellow fever, malaria, and dengue fever. An outbreak of such diseases or a public
health emergency could have a substantial impact on our operations in terms of reduced
productivity and increased medical and other costs. These health threats can impair the health
of workers and negatively affect our operations and financial position as a result of workers’
diminished focus or skill, absenteeism, treatment costs and allocated resources. Furthermore,
our financial position may be jeopardized by the cumulative effects of these factors. Any
current or future medical program may not be successful in preventing or reducing the infection
rate amongst our employees or in affecting consequent illness or mortality rates. We may incur
significant costs in addressing these issues in the future, which could also adversely impact our
results of operations and financial condition.
RISKS RELATING TO OUR DOING BUSINESS IN THE PRC
The economic landscape of PRC is subject to change and the future performance of
China’s economy is uncertain.
We conduct our business and generate a portion of our revenue in the PRC. As a result,
economic developments in the PRC have a significant effect on our business, financial
condition, results of operations and prospects. In recent years, the PRC has been one of the
world’s fastest growing economies in terms of GDP growth. However, the COVID-19
outbreaks have caused disruption to the global economy, which may in the future continue to
have an impact on the PRC’s economy. Any significant slowdown in the PRC’s economy could
have a material adverse effect on our business and operations. In particular:
 during a period of economic slowdown, there is a greater likelihood that more of our
customers or contractual parties could become delinquent in respect of their
obligations to us;
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 we may not be able to raise additional capital on terms that are commercially
favorable to us, or at all; or
 trade and capital flows may further contract as a result of protectionist measures
introduced in certain markets, which could cause a further slowdown in economies
and materially and adversely affect our business and prospects.
In addition, factors such as consumer, corporate and government spending, business
investment, volatility of the capital markets and inflation all affect the business and economic
environment, the growth of the PRC’s mining industry and ultimately, the profitability of our
business. Our labor and other costs may also increase due to pressure from inflation. Any future
calamities, such as natural disasters, outbreaks of contagious diseases or social unrest, may
cause a decrease in the level of economic activities and adversely affect the economic growth
in the PRC, Asia and elsewhere in the world.
As such, if the PRC’s economy experiences significant adverse developments or a
significant downturn, our business, financial condition and results of operations would be
materially and adversely affected.
Changes in the economic, political and social conditions in the PRC may have a material
adverse effect on our business, financial condition and results of operations.
A portion of our assets are located in the PRC and a portion of our revenue is derived from
our business in the PRC. Accordingly, our business, financial condition, results of operations
and prospects are, to a material extent, subject to economic, political and legal developments
in the PRC. The PRC economy differs from the economies of developed countries in many
respects, including, among other things, government involvement, level of economic
development, growth rate and resources allocation.
In recent years, the PRC Government has implemented measures emphasizing the
utilisation of market forces in economic reform and the establishment of sound corporate
governance practices in business enterprises. These economic reform measures may be
adjusted or modified, or applied inconsistently, from industry to industry or across different
regions of the country. If the business environment in the PRC changes, our business in the
PRC may also be materially and adversely affected.
Y ou may have limited recourse in effecting services of legal process or enforcing overseas
judgments against us, our Directors, Supervisors and our senior management.
Most of our Directors and executive officers reside within the PRC, and some of our
company’s assets and the assets of those persons are located within the PRC. It may be
difficult, complicated and time-consuming for investors to effect service of process upon us or
those persons inside the PRC or to enforce against us or them in the PRC any judgments
obtained from non-PRC courts.
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A judgment of a court of another jurisdiction may only be reciprocally recognized or
enforced if the jurisdiction has a treaty with the PRC or if the judgment complies with the
principle of reciprocity and do not violate the basic principles of the PRC laws, national
sovereignty, security, social interests and public interests, subject to the satisfaction of other
requirements. On January 25, 2024, the Supreme People’s Court issued the Arrangement on
Mutual Recognition and Enforcement of Judgments in Civil and Commercial Matters by Courts
of the Mainland and of the Hong Kong Special Administrative Region (ಥतй
τર) (the “ Arrangement ”), which was
implemented on January 29, 2024. Under the Arrangement, any relevant party may apply to the
relevant PRC court or Hong Kong court for recognition and enforcement of a final court
judgment in civil and commercial cases subject to the conditions set forth in the Arrangement.
Although the Arrangement has come into effect, uncertainties remain as to the outcome and
effectiveness of any action brought under the Arrangement. The recognition and enforcement
of foreign judgments are provided for under the PRC Civil Procedures Law. Courts in mainland
China may recognize and enforce foreign judgments in accordance with the requirements of the
PRC Civil Procedures Law on basis of either on (i) the treaties between mainland China and
the country where the judgment is made or (ii) on principles of reciprocity between
jurisdictions. In addition, according to the PRC Civil Procedures Law, the courts in mainland
China will not enforce a foreign judgment against us or our Directors and officers if they
decide that the judgment violates the basic principles of PRC law or national sovereignty,
security or public interest. As a result, in case of violation of the above principles, there is no
assurance that a judgment rendered by a court outside the PRC would be recognized and
enforced in a court in mainland China.
Gains on the sales of H Shares and dividends on the H Shares may be subject to PRC
income taxes.
Under the applicable PRC tax laws, both the dividends we pay to non-PRC resident
individual holders of H shares (“ non-resident individual holders ”), and gains realized
through the sale or transfer by other means of H shares by such Shareholders, are subject to
PRC individual income tax at a rate of 20%, unless reduced by the applicable tax treaties or
arrangements.
Under applicable PRC tax laws, the dividends we pay to, and gains realized through the
sale or transfer by other means of H shares by non-PRC resident enterprise holders of H shares
(“non-resident enterprise holders ”), are both subject to EIT at a rate of 10%, unless reduced
by applicable tax treaties or arrangements. Pursuant to the Arrangements between the Mainland
of China and the Hong Kong Special Administrative Region for the Avoidance of Double
Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Incomes (ಥ
τર) dated August 21, 2006, any non-
resident enterprise registered in Hong Kong that holds, directly, at least 25% of the shares of
our Company shall pay Enterprise Income Tax for the dividends declared and paid by us at a
tax rate of 5% if the Hong Kong non-resident enterprise is the beneficial owner of the equity
and certain other conditions are met.
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For non-resident individual holders, gains realized through the transfer of properties are
normally subject to PRC individual income tax at a rate of 20%. However, according to the
Circular of the Ministry of Finance and the State Taxation Administration on Issues Concerning
Individual Income Tax Policies (ٝ)
effective as of May 13, 1994, income received by individual foreigners from dividends and
bonuses of a foreign-invested enterprise are exempt from individual income tax for the time
being. According to the Circular Declaring that Individual Income Tax Continues to Be
Exempted over Individual Income from Transfer of Shares issued by the MOF and the STA ( ᗫ
ٝeffective as of March 30, 1998, income
from individuals’ transfer of stocks of listed companies continued to be temporarily exempted
from individual income tax. On February 3, 2013, the State Council approved and promulgated
the Notice of Suggestions to Deepen the Reform of System of Income Distribution ( ਷ਕ৫ҭ
ٝOn February 8, 2013, the
General Office of the State Council promulgated the Circular Concerning Allocation of Key
Works to Deepen the Reform of System of Income Distribution (ଉʷϗɝ
ٝAccording to these two documents, the PRC Government
is planning to cancel foreign individuals’ tax exemption for dividends obtained from
foreign-invested enterprises, and the Ministry of Finance and the State Taxation Administration
should be responsible for making and implementing details of such plan. However, relevant
implementation rules or regulations have not been promulgated by the Ministry of Finance and
the State Taxation Administration.
Considering these uncertainties, non-resident holders of our Shares should be aware that
they may be obligated to pay PRC income tax on the dividends and gains realized through sales
or transfers of the H shares.
Policies regarding foreign currency conversion may affect our foreign exchange
transactions and our ability to pay dividends and meet other obligations.
During the Track Record Period, we received our revenue both in Renminbi and U.S.
dollars. Currently, the conversion of RMB into foreign currency has to comply with the
relevant laws and regulations and remittance of foreign currencies are subject to the PRC
foreign exchange regulations. We may have to convert a portion of our revenue into other
currencies to meet our foreign currency obligations, such as payments of dividends declared in
respect of our H Shares, if any, and settlement of foreign investment. Shortage in the
availability of foreign currency may restrict the ability of our Group to remit sufficient foreign
currency out of the PRC, or otherwise satisfy our foreign currency denominated obligations.
Under existing PRC foreign exchange regulations, payments of current account items,
such as profit distributions and trade and service-related foreign exchange transactions, can be
made in foreign currencies without prior approval from the SAFE, by complying with certain
procedural requirements. However, approval from or registration with appropriate
governmental authorities is required where RMB is to be converted into foreign currency and
remitted out of the PRC to pay capital expenses under the capital account such as the
repayment of loans denominated in foreign currencies.
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The policies regarding foreign exchange transactions under the current account and the
capital account may not necessarily continue in the future. In addition, these foreign exchange
policies may restrict our ability to obtain sufficient foreign exchange, which could have an
adverse effect on our foreign exchange transactions and the fulfilment of our other foreign
exchange requirements. If there are changes in the policies regarding the payment of dividends
in foreign currencies to shareholders or other changes in foreign exchange policies resulting in
insufficient foreign exchange, our payment of dividends in foreign currencies may be affected.
If we fail to comply with environmental, health and safety laws and regulations, we could
be subject to fines or penalties or incur costs that could have a material adverse effect on
the success of our business.
We are subject to numerous environmental, health and safety laws and regulations and
related inquiries in relation to our production processes. For example, our construction projects
are subject to Regulations on the Administration of Construction Project Environmental
Protection (ᚐ၍ଣૢԷ), and its environmental impact assessment documents
shall be approved by the relevant environmental protection department. Our production plants
and the facilities we use are subject to regular inspections by the regulatory authorities for
compliance with the Safe Production Law of the PRC (جand
Regulation on Work Safety Permits ( τΌ͛ପ஢̙ᗇૢԷ). Furthermore, under the PRC Labor
Law (جand Law of the PRC on the Prevention and Treatment of
Occupational Diseases (جطwe must ensure that our facilities
comply with the PRC standards and requirements on occupational health and safety conditions
for employees.
As of the Latest Practicable Date, we were in the process of obtaining one environmental
impact assessment approval for project under construction from the relevant environmental
protection department. As advised by our PRC Legal Advisor, the risk of material
administrative penalty for such non-compliant incident is remote and does not have a material
and adverse effect on our business.
As of the Latest Practicable Date, two of our safety production permits had expired. There
are no provisions for administrative penalties against a company for failing to complete the
renewal application before the expiration of the certificate if a company is not producing and
we had not been imposed administrative actions, nor received any notice from the competent
authorities. As advised by our PRC Legal Advisor, it does not have a material and adverse
effect on our business operation.
However, there can be no assurance that any new laws and regulations or any changes in
the implementation of the existing laws and regulations will not require us to pay any
contribution shortfall retroactively or any administrative penalties. In addition, we may incur
substantial costs in order to comply with current or future environmental, health and safety
laws and regulations. These current or future laws and regulations may impair our research,
development or production efforts. Failure to comply with these laws and regulations also may
result in substantial fines, penalties or other sanctions, thereby adversely affecting our financial
condition and results of operations.
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Implementation and enforcement of the labor laws and regulations in China may
adversely affect our business and results of operations. Failure to fully comply with PRC
labor-related laws may expose us to potential liabilities and penalties.
Pursuant to the PRC Labor Contract Law (جthat took effect in
January 2008, with its amendment that took effect in July 2013, and its implementation rules
that took effect in September 2008, (the “ Labor Contract Law ”) employers are subject to
strict requirements in terms of signing labor contracts, minimum wages, paying remuneration,
determining the term of employees’ probation and unilaterally terminating labor contracts. Due
to lack of detailed interpretative rules and broad discretion of the local competent authorities,
it is uncertain as to how the Labor Contract Law and its implementation rules will affect our
current employment policies and practices. Our employment policies and practices may violate
the Labor Contract Law or its implementation rules, and we may thus be subject to related
penalties, fines or legal fees. Compliance with the Labor Contract Law and its implementation
rules may increase our operating expenses, in particular our personnel expenses. In the event
that we decide to terminate some of our employees or otherwise change our employment or
labor practices, the PRC Labor Contract Law and its implementation rules may also limit our
ability to effect those changes in a desirable or cost-effective manner, which could adversely
affect our business and results of operations.
On October 28, 2010, the Standing Committee of the NPC promulgated the PRC Social
Insurance Law (جwhich became effective on July 1, 2011 and was
amended on December 29, 2018 and took effect on the same date (the “ Social Insurance
Law”). According to the Social Insurance Law, employers should make the social insurance
registration and employees must participate in pension insurance, work-related injury
insurance, medical insurance, unemployment insurance and maternity insurance and the
employers must, together with their employees or separately, pay the social insurance
premiums for such employees. Recently, the PRC Government enhanced its measures relating
to social insurance collection, which may lead to stricter enforcement.
Pursuant to the Regulations on Management of Housing Provident Fund (၍
ଣૢԷ) promulgated by the State Council on April 3, 1999 and took effect on the same date,
which was amended, supplemented or otherwise modified from time to time and was lately
amended on March 24, 2019 to take effective on the same date, employers must open housing
provident fund account and pay housing provident fund for its employees. However, our social
insurance and/or housing provident fund policies and practices may in the future be found to
have violated the relevant laws regulations, and we may therefore be subject to related
administrative measures, penalties, fines or legal fees. Compliance with the relevant laws and
regulations may increase our operating expenses, in particular our personnel expenses.
As the interpretation and implementation of labor laws and regulations are still evolving,
there can be no assurance that our employment practice policy and will at all times be deemed
to be in full compliance with labor-related laws and regulations in China, which may subject
us to labor disputes or government investigations. If we are deemed to have violated relevant
labor laws and regulations, we could be required to provide additional compensation to our
employees and our business, financial condition and results of operations could be materially
and adversely affected.
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As of the Latest Practicable Date, we had not paid the social insurance and/or housing
provident funds for some of our employees, and the total unpaid amount calculated based on
the minimum contribution base of social insurance is RMB689,989, RMB774,966,
RMB810,724 and RMB465,332 for the three years ended December 31, 2021, 2022 and 2023
and the nine months ended September 30, 2024, respectively. We had not been imposed
administrative actions, nor received any notice from the competent authorities ordering
rectification or specifying deadline for payment of outstanding fees or administrative penalties
in respect of social insurance and housing provident fund. As advised by our PRC Legal
Advisor, the enforcement risk for such non-compliant incidents is remote and does not have a
material and adverse effect on our business operation. However, there can be no assurance that
any new laws and regulations or any changes in the implementation of the existing laws and
regulations will not require us to pay any contribution shortfall retroactively or any
administrative penalties, thereby materially and adversely affecting our financial condition and
results of operations.
We have not obtained title certificates for some of our properties and have not completed
registration procedures for some of our leased properties, which could materially and
adversely affect our right to use such properties.
We have certain title defects relating to the lands or properties that we own or use. For
example, we have not obtained construction approval documents and failed to apply for
changes in the type of land use rights for some of our properties. Under the applicable PRC
laws and regulations, the parties to a lease are required to register and file such lease with the
relevant government authorities. As of the Latest Practicable Date, three of our leased
properties had not been registered or filed. While the lack of registration will not affect the
validity of the leases under PRC laws and regulations, we may be ordered by the relevant
government authorities to register the relevant leases within a prescribed period, failing which
we may be subject to a fine ranging from RMB1,000 to RMB10,000 for each non-registered
lease. As advised by our PRC Legal Advisor, the risk of material administrative penalty for
such non-compliant incident is remote and does not have a material and adverse effect on our
business operation, or materially jeopardize the proposed Listing. Nevertheless, there can be
no assurance that we will not be subject to challenges, lawsuits or other actions taken against
us with respect to the lands or properties owned, used or leased by us for which we or the
relevant lessors do not hold perfected title certificates or fail to complete relevant registration
procedures. Furthermore, we may be subject to fines and penalties imposed by government
authorities with respect to certain title defects.
The PRC legal system is evolving and may have uncertainties that could limit the legal
protection available to us and investors.
The PRC legal system is a civil law system based on written statutes. Unlike the common
law system, prior court decisions under the civil law system may be cited for reference but have
limited precedential value.
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In late 1970s, the PRC Government began to promulgate a comprehensive system of laws
and regulations governing economic matters in general. The overall effect of legislation since
then has significantly enhanced the protections afforded to various forms of foreign
investments in China. However, recently enacted laws and regulations may not sufficiently
cover all aspects of economic activities in China. In particular, the interpretation and
enforcement of these laws and regulations involve uncertainties.
In addition, administrative proceedings and judicial procedures in China may be
protracted, which could result in higher costs and diversion of resources and management
attention. Since PRC administrative and court authorities have discretion in interpreting and
implementing statutory provisions and contractual terms, it may be difficult to evaluate the
outcome of administrative and court proceedings. These uncertainties may affect our judgment
on the relevance of legal requirements and our ability to enforce our contractual rights or tort
claims.
RISKS RELATING TO THE GLOBAL OFFERING
Our A Shares were listed in China in 2004, and the characteristics of the A Share and H
share market may differ.
Our A Shares were listed and traded on the Shanghai Stock Exchange in 2004. Following
the Global Offering, our A Shares will continue to be traded on the SSE, and our H Shares will
be traded on the Hong Kong Stock Exchange. Without regulatory approval, our A Shares and
H Shares are neither convertible into nor fungible with each other. The A share and H share
markets have different characteristics, including different trading volumes and liquidity and
different investor bases. As a result of these differences, the trading price of our A Shares and
H Shares may not be the same. Fluctuations in the price of our A Shares may adversely affect
the price of our H Shares, and vice versa. Due to the different characteristics of the A share and
the H share markets, the historical prices of our A shares may not be indicative of the
performance of our H Shares. Y ou should not rely on the prior trading history of our A Shares
when evaluating an investment in our H Shares. Past performance is no guarantee of future
results.
There has been no prior public market for our H Shares, and an active trading market for
our H Shares may not develop or be sustained.
Prior to the Global Offering, there was no public market for our H Shares. There can be
no assurance that the Global Offering will result in the development of an active, liquid public
trading market for our H Shares. The initial Offer Price for our H Shares to the public will be
the result of negotiations between us and the Sole Global Coordinator (for itself and on behalf
of the Underwriters), and the Offer Price may differ significantly from the market price of the
H Shares following completion of the Global Offering.
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We have applied to the Hong Kong Stock Exchange for the listing of, and permission to
deal in, the H Shares (including any H Shares which may be issued pursuant to the exercise of
the Over-allotment Option). However, there can be no guarantee that (i) an active and liquid
trading market for the H Shares will develop; (ii) or, if it does develop, that it will be sustained
following the Global Offering; or (iii) that the market price of the H Shares will not decline
below the Offer Price. If an active public market for our H Shares does not develop following
the completion of the Global Offering, the market price and liquidity of our H Shares could be
materially and adversely affected. Y ou may not be able to resell your Shares at a price that is
attractive to you, or at all.
The trading price of our H Shares may be volatile, which could result in substantial losses
to you.
The trading price and volume of our H Shares may be volatile. The market price of our
Shares may fluctuate significant and rapidly in response to factors beyond our control,
including, but not limited to:
 actual or anticipated variations of our results of operations;
 loss of key suppliers and/or contractors;
 changes in securities analysts’ estimates or market perception of our financial
performance;
 announcement by us of significant acquisitions, depositions, strategic alliances or
joint ventures;
 addition or departure of key senior management or other key personnel;
 fluctuations in the stock market price and volume;
 regulatory or legal developments, including involvement in litigations;
 fluctuations in trading volumes or the release of lock-up or other transfer restrictions
on our outstanding Shares or sales of additional Shares by us; and
 general market conditions of the securities markets in Hong Kong, China, the United
States and elsewhere in the world.
Furthermore, the performance and fluctuation of the market prices of other companies
with business operations located mainly in mainland China that have listed their securities in
Hong Kong may affect the volatility in the price of and trading volumes for our H Shares. A
number of mainland China-based companies have listed their securities, and some are in the
process of preparing for listing their securities, in Hong Kong. Some of these companies have
experienced significant volatility, including significant price declines after their initial public
RISK FACTORS
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offerings. The trading performances of the securities of these companies at the time of or after
their offerings may affect the overall investor sentiment towards mainland China-based
companies listed in Hong Kong and, consequently, may materially and adversely impact the
trading performance of our H Shares.
Y ou should not place any reliance on any information released by us in connection with
the listing of our A Shares on the Shanghai Stock Exchange.
Since the listing of our A Shares on the SSE, we have been subject to periodic reporting
and other information disclosure requirements in the PRC. As a result, from time to time we
publicly release information relating to us on the SSE or other media outlets designated by the
SSE. However, the information we announce in connection with our A Shares listing is based
on regulatory requirements and market practices in the PRC, which differ from those applicable
to the Global Offering. Such information does not and will not form a part of this Prospectus.
As a result, prospective investors in our H Shares are reminded that in making their investment
decisions as to whether to purchase our H Shares, they should rely only on the financial,
operating and other information included in this Prospectus. Past performance is no guarantee
of future results. By applying to purchase H Shares in the Global Offering you will be deemed
to have agreed that you will not rely on any information other than that contained in this
Prospectus, and any formal announcements made by us in Hong Kong related to the Global
Offering.
Future sales or perceived sales of substantial amounts of our H Shares in the public
market could have a material adverse effect on the price of our H Shares and our ability
to raise additional capital in the future.
The market price of our H Shares could decline as a result of future sales of a substantial
number of our H Shares or other securities relating to our H Shares in the public market, or the
issuance of new shares or other securities, or the perception that such sales or issuances may
occur. Future sales, or anticipated sales, of substantial amounts of our securities, including any
future offerings, could also materially and adversely affect our ability to raise capital at a
specific time and on terms favorable to us. In addition, our Shareholders may experience
dilution in their holdings if we issue more securities in the future. New shares or shares-linked
securities issued by us may also confer rights and privileges that take priority over those
conferred by the H Shares.
Y ou will incur immediate and substantial dilution if the Offer Price of the Offer Shares
is higher than the net tangible asset value per H Share and may experience further
dilution if we issue additional Shares in the future.
The Offer Price of the Offer Shares is higher than the net tangible asset value per H Share
immediately prior to the Global Offering. Therefore, purchasers of the Offer Shares in the
Global Offering will experience an immediate dilution in pro forma consolidated net tangible
asset value. To expand our business, we may consider offering and issuing additional Shares
in the future. If additional funds are raised through the issuance of new equity or equity-linked
RISK FACTORS
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securities of our Company, other than on a pro rata basis to existing Shareholders, then: (i) the
percentage ownership of the existing Shareholders may be reduced, and they may experience
subsequent dilution and reduction in their earnings per share; (ii) such newly issued securities
may have rights, preferences or privileges superior to those of the Shares of the existing
Shareholders; and/or (iii) subscribers and purchasers of our Shares may experience dilution in
the net tangible assets value per Share if we issue additional Shares in the future at a price
which is lower than our net tangible assets value per Share.
We have significant discretion as to how we will use the net proceeds of the Global
Offering, and you may not necessarily agree with how we use them.
Our management may spend the net proceeds from the Global Offering in ways you may
not agree with or that do not yield a favorable return. See “Future Plans and Use of Proceeds”
for details of our intended use of proceeds. However, our management will have discretion as
to the actual application of our net proceeds. We may not be able to use the funds in strict
accordance with each planned use of proceeds, and there is a possibility that we may deviate
from the planned implementation timeframe or fail to allocate the proceeds according to our
original plan. This potential divergence could be driven by a range of factors, including but not
limited to, fluctuations in market conditions, alterations in the regulatory landscape, challenges
in executing our business strategies, and unforeseen external occurrences. Additionally, our use
of proceeds may not achieve the expected operational and financial impact on our Group. Y ou
are entrusting your funds to our management, upon whose judgment you must depend, for the
specific use we will make of the net proceeds from this Global Offering.
A future significant increase or perceived significant increase in the supply of our H
Shares in public markets could cause the market price of our H Shares to decrease
significantly, and/or dilute shareholdings of holders of H Shares.
The market price of our H Shares could decline as a result of future sales of a substantial
number of our H Shares or other securities relating to our H Shares in the public market, or the
issuance of new shares or other securities, or the perception that such sales or issuances may
occur. Future sales, or anticipated sales, of substantial amounts of our securities, including any
future offerings, could also materially and adversely affect our ability to raise capital at a
specific time and on terms favorable to us. In addition, our Shareholders may experience
dilution in their holdings if we issue more securities in the future. New shares or shares-linked
securities issued by us may also confer rights and privileges that take priority over those
conferred by the H Shares.
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The interests of our Single Largest Shareholder Group may not necessarily be aligned
with the interests of our other Shareholders.
The interests of our Single Largest Shareholder Group may differ from the interests of our
other Shareholders. They could through their shareholding interest in our Company exert
influence in determining the outcome of any corporate transaction or other matter submitted to
our Shareholders for approval, including mergers, consolidations, the sale of all or
substantially all of our assets, election of Directors, and other significant corporate actions.
This as a result, may discourage, delay or prevent a change in control of our Company, which
could deprive our Shareholders of an opportunity to receive a premium for their H Shares in
a sale of our Company or may reduce the market price of our H Shares. In addition, to the
extent the interests of our Single Largest Shareholder Group conflict with the interests of other
Shareholders, the interests of other Shareholders may be disadvantaged or harmed.
Our historical dividends may not be indicative of our future dividend policy, and we may
not be able to pay any dividends on our H Shares.
We declared dividends to our Shareholders of nil, nil, RMB82.4 million and nil
respectively, for the three years ended December 31, 2021, 2022 and 2023 and the nine months
ended September 30, 2024, in light of our cumulative business growth. All of such dividends
declared during the Track Record Period had been fully settled by bank transfer to our
Shareholders as of the Latest Practicable Date. See also Note 16 to the Accountants’ Report in
Appendix IA to this Prospectus. However, our historical dividends may not be indicative of our
future dividend policy. There can be no guarantee: (i) when, if at all, will be paid on our H
Shares following the Global Offering; or (ii) if dividends are paid, what form they will take.
The declaration of dividends is proposed by the Board and is based on, and limited by, various
factors, including without limitation, macroeconomic factors, our business and financial
performance, capital and regulatory requirements, and general business conditions. We may not
have sufficient or any profits to enable us to make dividend distributions to our Shareholders
in the future, even if our financial statements indicate that our operations have been profitable.
See the section headed “Financial Information — Dividend” in this Prospectus for more
details. Past performance is no guarantee of future results.
If securities or industry analysts do not publish research reports about our business, or
if they adversely change their recommendations regarding our H Shares, the market price
and trading volume of our H Shares may decline.
The trading market of our H Shares may be influenced by research reports that industry
or securities analysts publish about us or our business. If one or more analysts who cover us
downgrade our H Shares or publish negative opinions about us, the market price of our H
Shares would likely decline regardless of the accuracy of the information. If one or more of
these analysts cease coverage of us or fail to regularly publish reports on us, we could lose
visibility in the financial markets, which, in turn, could cause the market price and/or trading
volume of our H Shares to decline.
RISK FACTORS
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RISKS RELATING TO THE STATEMENTS MADE IN THIS PROSPECTUS
Forward-looking statements contained in this document are subject to risks and
uncertainties.
This document contains certain statements and information that are forward-looking and
uses forward-looking terminology such as “aim”, “anticipate”, “believe”, “can”, “could”,
“continue”, “estimate”, “going forward”, “intend”, “plan”, “project”, “potential”, “predict”,
“seek”, “expect”, “may”, “might”, “ought to”, “should”, “would” or “will” and similar
expressions. These statements are, by their nature, subject to significant risks and uncertainties.
Prospective investors are cautioned that reliance on any forward-looking statement involves
risk and uncertainties and that, even if the Directors believe the assumptions related to those
forward-looking statements are reasonable, any or all of those assumptions could prove to be
inaccurate and as a result, the forward-looking statements based on those assumptions could
also be incorrect.
The risks and uncertainties in this regard consist of those identified in the risk factors
discussed above. In light of these and other risks and uncertainties, the disclosure of
forward-looking statements in this document should not be regarded as representations by our
Company that the plans and objectives will be achieved, and investors should not place undue
reliance on such statements. Past performance is no guarantee of future results. Our Company
does not undertake any obligation to update publicly or release any revisions of any
forward-looking statements, whether as a result of new information, future events, or
otherwise. For details of these forward-looking statements including the associated risks, see
“Forward-looking Statements.”
The industry data and forecasts in this Prospectus obtained from various official
government publications have not been independently verified.
This Prospectus includes industry data and forecasts that we obtained from various
government publications. However, there can be no assurance of the accuracy or completeness
of information obtained from these sources. We have not independently verified any of the
data, forecasts and other statistics from such sources, nor have we ascertained that the
underlying economic assumptions relied upon in those sources. Also, the Sole Sponsor, the
Sponsor Overall Coordinators, the Overall Coordinators, the Underwriters, any of their
respective directors, officers, affiliates, advisors and representatives, or any other parties
involved in the Global Offering make no representation as to the accuracy or completeness of
aforementioned facts, forecasts and other statistics in this Prospectus. Moreover, such facts,
forecasts and other statistics may not be prepared on the same basis or with the same degree
of accuracy (as the case may be) in other publications or jurisdictions. For these reasons, the
information from various government publications contained in this Prospectus may not be
accurate and should not be given undue reliance as a basis for making your investment in our
H Shares.
RISK FACTORS
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Y ou should read the entire Prospectus carefully, and we strongly caution you not to place
any reliance on any information contained in press articles and other media regarding us
and the Global Offering.
We strongly caution you not to rely on any information contained in press articles or other
media regarding us and the Global Offering. Prior to the publication of this Prospectus, there
has been press and media coverage regarding us, our business, our industry, and the Global
Offering. There may be additional media coverage regarding us, our business, our industry, and
the Global Offering after the date of this Prospectus but prior to the completion of the Global
Offering. Such press and media coverage may include references to certain information that
does not appear in this Prospectus, including certain operating and financial information and
projections, valuations and other information. Neither our Company nor any other person
involved in the Global Offering has authorized the disclosure of any such information in the
press or media, and none of us accepts any responsibility for any such press or media coverage
or the accuracy or completeness of any such information or publication. We make no
representation as to, and do not accept any responsibility for, the appropriateness, accuracy,
completeness or reliability of any such information or publication. To the extent that any such
information is inconsistent or conflicts with the information contained in this Prospectus, we
disclaim responsibility for it, and you should not rely on such information.
RISK FACTORS
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In preparation for the Listing, our Company has sought the following waivers from strict
compliance with the relevant provisions of the Hong Kong Listing Rules.
MANAGEMENT PRESENCE IN HONG KONG
According to Rule 8.12 of the Hong Kong Listing Rules, a new applicant for a primary
listing on the Hong Kong Stock Exchange must have a sufficient management presence in
Hong Kong. This normally means that at least two of our executive Directors must be
ordinarily resident in Hong Kong. Rule 19A.15 of the Hong Kong Listing Rules further
provides that the requirement in Rule 8.12 of the Hong Kong Listing Rules may be waived by
having regard to, among other considerations, our arrangements for maintaining regular
communication with the Hong Kong Stock Exchange.
We do not have a sufficient management presence in Hong Kong for the purpose of
satisfying the requirement under Rules 8.12 and 19A.15 of the Hong Kong Listing Rules. Our
management headquarters, senior management, business operations and assets are primarily
based outside Hong Kong. Our Directors consider that either by means of relocation of our
existing executive Directors or appointment of additional executive Directors who will be
ordinarily resident in Hong Kong would not be beneficial to, or appropriate for, our Group and
therefore would not be in the best interests of our Company or our Shareholders as a whole.
As such, we have applied to the Hong Kong Stock Exchange for, and the Hong Kong Stock
Exchange has granted us a waiver from strict compliance with Rules 8.12 and 19A.15 of the
Hong Kong Listing Rules. We will ensure that there is a regular and effective communication
between us and the Hong Kong Stock Exchange by way of, among others, the following
arrangements, which are in line with the guidance in Chapter 3.10 of the Guide:
(i) pursuant to Rule 3.05 of the Hong Kong Listing Rules, we have appointed and will
continue to maintain two authorized representatives, who will act as our principal
channel of communication with the Hong Kong Stock Exchange and ensure that our
Company complies with the Hong Kong Listing Rules at all times. The two
authorized representatives appointed are Ms. Y ang Yi-fang (˙)( “ Ms. Y ang”),
our executive Director and Chief Executive Officer, and Mr. Wong Hok Bun Mario
(රኪⅳ)( “ Mr. Wong ”), our Vice President, Chief Financial Officer and company
secretary. Ms. Y ang and Mr. Wong are situated and based in Hong Kong, and will
be available to meet with the Hong Kong Stock Exchange in Hong Kong within a
reasonable time frame upon the request of the Hong Kong Stock Exchange. Both of
our authorized representatives will be readily contactable by telephone and email to
deal promptly with enquiries from the Hong Kong Stock Exchange. Our Company
has provided contact details of the two authorized representatives to the Hong Kong
Stock Exchange and will inform the Hong Kong Stock Exchange promptly in respect
of any change in the authorized representatives;
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(ii) both authorized representatives have means to contact all Directors (including the
independent non-executive Directors) promptly at all times as and when the Hong
Kong Stock Exchange wishes to contact our Directors for any matters. Our
Company has implemented a policy whereby: (a) each Director has provided their
respective valid phone numbers or other means of communication to the authorized
representatives; (b) in the event that a Director expects to travel or is otherwise out
of office, he/she will endeavour to provide his/her phone number of the place of
his/her accommodation to the authorized representatives or maintain an open line of
communication via his/her mobile phone; and (c) each Director has provided his or
her mobile phone number, office phone number, e-mail address and, where
available, fax number to the Hong Kong Stock Exchange and will inform the Hong
Kong Stock Exchange promptly if there are any changes to the contact details of the
Directors;
(iii) pursuant to Rule 3.20 of the Hong Kong Listing Rules, each Director has provided
his or her contact information to the Hong Kong Stock Exchange and to the
authorized representatives. This will ensure that the Hong Kong Stock Exchange and
the authorized representatives should have means for contacting all Directors
promptly at all times as and when required;
(iv) all our Directors who are not ordinarily resident in Hong Kong have confirmed that
they possess or can apply for valid travel documents to visit Hong Kong and will be
able to meet with relevant members of the Hong Kong Stock Exchange in Hong
Kong upon reasonable notice, when required;
(v) pursuant to Rule 3A.19 of the Hong Kong Listing Rules, we have retained the
services of Goldlink Capital (Corporate Finance) Limited as our compliance advisor
(the “ Compliance Advisor ”) upon Listing for a period commencing on the Listing
Date and ending on the date on which we comply with Rule 13.46 of the Hong Kong
Listing Rules in respect of our financial results for the first full financial year
commencing after the Listing Date, which will act as an additional channel of
communication with the Hong Kong Stock Exchange and will be available to
respond to enquiries from the Hong Kong Stock Exchange; our Company has
provided the Hong Kong Stock Exchange with the names, mobile phone numbers,
office phone numbers, fax numbers and email addresses of the Compliance
Advisor’s officers who will act as the Compliance Advisor’s contact persons
between the Hong Kong Stock Exchange and our Company;
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(vi) our authorized representatives, Directors and other officers of our Company will
provide promptly such information and assistance as the Compliance Advisor may
reasonably require in connection with the performance of the Compliance Advisor’s
duties as set forth in Chapter 3A of the Hong Kong Listing Rules. There will be
adequate and efficient means of communication between our Company, authorized
representatives, Directors and other officers of our Company and the Compliance
Advisor, and to the extent reasonably practicable and legally permissible, we will
keep the Compliance Advisor informed of all communications and dealings between
the Hong Kong Stock Exchange and us; meetings between the Hong Kong Stock
Exchange and our Directors could be arranged through our authorized
representatives or the Compliance Advisor, or directly with our Directors within a
reasonable time frame. We will inform the Hong Kong Stock Exchange as soon as
practicable in respect of any change of authorized representatives and/or the
Compliance Advisor;
(vii) we will appoint other professional advisors (including legal advisor in Hong Kong)
after the Listing to assist us in dealing with any questions which may be raised by
the Hong Kong Stock Exchange and to ensure that there will be prompt and effective
communication with the Hong Kong Stock Exchange; and
(viii) our Company has designated one of our staff members as the communication officer
at our headquarters after the Listing who will be responsible for maintaining
day-to-day communication with Ms. Y ang and Mr. Wong and our Company’s
professional advisors in Hong Kong, including our legal advisor in Hong Kong and
the Compliance Advisor, to keep abreast of any correspondences and/or enquiries
from the Hong Kong Stock Exchange and report to our executive Directors to further
facilitate communication between the Hong Kong Stock Exchange and our
Company.
ALLOCATION OF OUR H SHARES TO EXISTING MINORITY SHAREHOLDERS
AND THEIR CLOSE ASSOCIATES UNDER RULE 10.04 AND PARAGRAPH 5(2) OF
APPENDIX F1 TO THE HONG KONG LISTING RULES
Rule 10.04 of the Hong Kong Listing Rules requires that a person who is an existing
shareholder of the issuer may only subscribe for or purchase any securities for which listing
is sought which are being marketed by or on behalf of the issuer either in his or its own name
or through nominees if the conditions in Rules 10.03(1) and (2) of the Hong Kong Listing
Rules are fulfilled. It is provided in Rule 10.03(1) of the Hong Kong Listing Rules that no
securities may be offered to existing shareholders on a preferential basis and no preferential
treatment may be given to them in the allocation of the securities and in Rule 10.03(2) that the
minimum prescribed percentage of public shareholders required by Rule 8.08(1) must be
achieved. Paragraph 5(2) of Appendix F1 to the Hong Kong Listing Rules provides, among
other things, that, without the prior written consent of the Hong Kong Stock Exchange, no
allocations will be permitted to existing shareholders or their close associates, whether in their
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own names or through nominees, in the Global Offering unless the conditions set out in Rules
10.03 and 10.04 of the Hong Kong Listing Rules are fulfilled. Chapter 4.15 (Placing-related
Matters) of the Guide provides guidance as to the conditions subject to which the Hong Kong
Stock Exchange will consider giving consent and granting waiver from strict compliance with
the requirements under Rule 10.04 of the Hong Kong Listing Rules to an applicant’s existing
shareholders or their close associates to participate in a global offering if any actual or
perceived preferential treatment arising from their ability to influence the applicant during the
allocation process can be addressed.
Our Company is a listed company, and its A shares have been listed on the Shanghai Stock
Exchange since April 14, 2004 (stock code: 600988). We have a large and widely dispersed
public A Shares shareholder base.
We have applied to the Hong Kong Stock Exchange for, and the Hong Kong Stock
Exchange has granted to us, a waiver from strict compliance with the requirements under Rule
10.04 and consent pursuant to Paragraph 5(2) of Appendix F1 to the Hong Kong Listing Rules
and Chapter 4.15 of the Guide to permit H Shares in the International Offering to be placed to
certain existing minority Shareholders who (i) hold less than 5% of the total number of A
Shares of our Company in issue prior to the completion of the Global Offering and (ii) are not
and will not become (upon the completion of the Global Offering) core connected persons of
our Company or the close associates of any such core connected persons (collectively, the
“Existing Minority A Shareholders ”), subject to the following conditions:
(a) each of the Existing Minority A Shareholders to whom our Company may allocate
H Shares in the International Offering is interested in less than 5% of the total
number of A Shares of our Company in issue prior to the completion of the Global
Offering;
(b) each of the Existing Minority A Shareholders is not, and will not be, a core
connected person of our Company or any close associate of any such core connected
person immediately prior to or following the Global Offering;
(c) none of the Existing Minority A Shareholders has the right to appoint any Director
and/or has any other special rights in our Company;
(d) allocation to such Existing Minority A Shareholders will not affect our ability to
satisfy the public float requirement as prescribed by the Hong Kong Stock Exchange
under the waiver from strict compliance with the requirements of Rule 8.08 of the
Hong Kong Listing Rules;
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(e) we will confirm to the Hong Kong Stock Exchange in writing that in the case of
participation as placees, no preferential treatment has been, nor will be, given to the
Existing Minority A Shareholders, nor is the Existing Minority A Shareholders in a
position to exert influence on our Company to obtain actual or perceived preferential
treatment, by virtue of their relationship with our Company in any allocation in the
placing tranche.
(f) in the case of participation as placees, the Overall Coordinators will confirm to the
Hong Kong Stock Exchange that, to the best of their knowledge and belief, no
preferential treatment has been, nor will be, given to the Existing Minority A
Shareholders by virtue of their relationship with our Company in any allocation in
the placing tranche; and
(g) the Sole Sponsor will confirm to the Hong Kong Stock Exchange that based on (i)
its discussions with our Company and the Overall Coordinators; and (ii) the
confirmations provided to the Hong Kong Stock Exchange by our Company and the
Overall Coordinators (confirmations (e) and (f) above), and to the best of their
knowledge and belief, they have no reason to believe that any of the Existing
Minority A Shareholders received any preferential treatment, or is in a position to
exert influence on our Company to obtain actual or perceived preferential treatment
in the allocation as placees by virtue of their relationship with our Company other
than the preferential treatment of assured entitlement following the principles set out
in Chapter 4.15 of the Guide, and details of the allocation to the Existing Minority
A Shareholders holding more than 1% of the issued share capital of our Company
immediately prior to the completion of the Global Offering will be disclosed in this
prospectus and/or the allotment results announcement, as the case may be.
THE POST-TRACK RECORD PERIOD ACQUISITION
Rules 4.04(2) and 4.04(4) of the Hong Kong Listing Rules require that the new applicant
include in its accountants’ report the results and balance sheet of any business or subsidiary
acquired, agreed or proposed to be acquired, since the date to which its latest audited accounts
have been made up, in respect of each of the three financial years immediately preceding the
issue of the listing document.
Pursuant to note (4) of Rule 4.04(4) of the Hong Kong Listing Rules, the Hong Kong
Stock Exchange may consider an application for a waiver from strict compliance with Rules
4.04(2) and 4.04(4) of the Hong Kong Listing Rules taking into account the following factors:
(a) that all the percentage ratios (as defined under Rule 14.07 of the Hong Kong Listing
Rules) are less than 5% by reference to the most recent audited financial year of the
new applicant’s trading record period;
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(b) if the acquisition will be financed by the proceeds raised from a public offer, the new
applicant has obtained a certificate of exemption from the SFC in respect of the
relevant requirements under paragraphs 32 and 33 of the Third Schedule to the
Companies (Winding Up and Miscellaneous Provisions) Ordinance; and
(c) (i) where a new applicant’s principal activities involve the acquisition of equity
securities (the Hong Kong Stock Exchange may require further information where
securities acquired are unlisted), the new applicant is not able to exercise any
control, and does not have any significant influence over the underlying company or
business to which Rules 4.04(2) and 4.04(4) of the Hong Kong Listing Rules relate,
and has disclosed in its listing document the reasons for the acquisition and a
confirmation that the counterparties and their respective ultimate beneficial owners
are independent of the new applicant and its connected persons. In this regard,
“control” means the ability to exercise or control the exercise of 30% (or any amount
specified in the Hong Kong Code on Takeovers and Mergers as the level for
triggering a mandatory general offer) or more of the voting power at general
meeting, or being in a position to control the composition of a majority of the board
of directors of the underlying company or business; or (ii) with respect to an
acquisition of a business (including acquisition of an associated company and any
equity interest in a company other than in the circumstances covered under
sub-paragraph (a) above) or a subsidiary by a new applicant, the historical financial
information of such business or subsidiary is unavailable, and it would be unduly
burdensome for the new applicant to obtain or prepare such financial information;
and the new applicant has disclosed in its listing document information required for
the announcement for a discloseable transaction under Rules 14.58 and 14.60 of the
Hong Kong Listing Rules on each acquisition. In this regard, “unduly burdensome”
will be assessed based on each new applicant’s specific facts and circumstances (e.g.
why the financial information of the acquisition target is not available and whether
the new applicant or its controlling shareholder has sufficient control or influence
over the seller to gain access to the acquisition target’s books and records for the
purpose of complying with the disclosure requirements under Rules 4.04(2) and
4.04(4) of the Hong Kong Listing Rules).
On March 4, 2024, our subsidiaries, Chixia Laos and Chijin Xiawu entered into an equity
transfer agreement with China Investment (Property) Limited ( ʕ਷ҳ༟(ໄุ)ʮ̡)
(“China Investment ”) and China Investment Mining (Laos) Sole Co., Ltd (the “ Target
Company ”), pursuant to which Chixia Laos shall acquire from China Investment 90% of the
equity interest in the Target Company, which was wholly owned by China Investment, at a
consideration of US$18,963,000.
W AIVERS FROM STRICT COMPLIANCE WITH THE HONG KONG LISTING RULES AND EXEMPTION FROM
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The Target Company operates the Mengkham Rare Earth Element Project and has two
subsidiaries which held a rare earth mineral processing permit (experimental), a mineral
extraction permit (experimental) and a rare earth exploration permit. The project is still at the
construction stage covering the mining area of 50 km
2, whereby the genetic type of the mineral
deposit belongs to the weathering curst ion-adsorbed rare earth deposit. To the best of our
knowledge, we confirmed that, as of the Latest Practicable Date, (a) there were no outstanding
permit or license which were pending approval from the Laos regulatory authorities in
connection with this project; and (b) based on the disclosure from the Target Company to us
and the due diligence conducted by us during the acquisition process, the Target Company held
necessary licenses and/or permits to conduct rare earth exploration and operation in all material
aspects.
Based on the accounts provided by the Target Company, the consolidated total assets of
the Target Company amounted to approximately KIP228,001,488,000 as of December 31,
2023. Its consolidated net loss before (and after) tax for the years ended December 31, 2022
and 2023 was approximately KIP86,757,701,000 and KIP94,724,614,000, respectively.
As of the Latest Practicable Date, our Company had obtained the approval from the
Xiamen Development and Reform Commission, and the parties to the transactions were
proceeding with the fulfillment of the other conditions of the transaction including changes of
the authorized representative of the Target Group. Accordingly, the above proposed acquisition
was yet to be completed. For details, see the section headed “History, Development and
Corporate Structure — The Post-Track Record Period Acquisition” in this Prospectus. To the
best estimate of the Directors, the proposed acquisition is expected to be completed by the first
half of 2025.
The proposed acquisition is in the ordinary and usual course of business of our Company.
Our Directors are of the view that: (i) the acquisition represents an opportunity for our Group
to tap into the potential for quality rare earth resources with a relatively higher economic value
to be realised through the medium-heavy rare earth ore held by the project; and (ii) the terms
of the proposed acquisition are on normal commercial terms, and are fair and reasonable and
in the interests of our Company and our Shareholders as a whole. The consideration for the
proposed acquisition is to be satisfied by the internal resources of our Group and will not use
any proceeds from the Global Offering.
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Our Company has applied to the Hong Kong Stock Exchange for, and the Hong Kong
Stock Exchange has granted, a waiver from strict compliance with Rules 4.04(2) and 4.04(4)
of the Hong Kong Listing Rules in respect of the above proposed acquisition on the following
grounds:
(i) Immateriality of the acquisition
The scale of the business operated by the Target Company and its subsidiaries
(collectively the “ Target Group ”) as compared to that of our Group is not material.
The applicable percentage ratios calculated in accordance with Rule 14.07 of the
Hong Kong Listing Rules for the Acquisition are all less than 5% by reference to the
most recent financial year or period in the Track Record Period.
In addition, notwithstanding that the proposed acquisition represents a suitable
strategic acquisition target of our Group, it will not result in any significant change
to our financial position since September 30, 2024, and all information that is
reasonably necessary for the potential investors to make an informed assessment of
the activities or our financial position has been included in this Prospectus. As such,
a waiver from compliance with Rules 4.04(2) and 4.04(4) of the Hong Kong Listing
Rules would not prejudice the interests of the investing public.
(ii) Impracticality and undue burden
As of the Latest Practicable Date, the proposed acquisition was yet to have been
completed. Prior to the completion of the proposed acquisition, given that (i) China
Investment and its ultimate beneficial owners are Independent Third Parties; and (ii)
our Company has no representation or control over the board of directors of the
Target Company, our Group is not in a position to be able to compel the disclosure
of financial information to our Group and/or our Reporting Accountants for
inclusion in this Prospectus to the standards required under Rules 4.04(2) and
4.04(4) of the Hong Kong Listing Rules. Further, as our Group is not involved in the
day-to-day management of the Target Group, and particularly when there is no
statutory audit requirement under the laws of Laos, our Company and our Reporting
Accountants will unlikely gain full access to the financial information of the Target
Group in a readily available manner. In addition, given that there is no local
statutory audit requirement, the accounts of the Target Group were prepared for
internal management purposes and not for audit purposes. It would require
considerable time and resources to become fully familiarized with the accounting
system and accounting policies and to gather, compile and audit the necessary
financial information and supporting documents for disclosure in this Prospectus. As
a result, preparing the financial information of the Target Group in accordance with
the IFRS and within a short period of time in order for such audited financial
information to be included in the Accountants’ Report in this Prospectus would
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present an onerous challenge. Therefore, it would be impracticable and burdensome
for our Company to prepare and include the full historical financial information of
the Target Group in this Prospectus.
(iii) Alternative disclosure
With a view of allowing our potential investors to understand in greater details, we
have provided information in this Prospectus the following information regarding
the proposed acquisition, which is comparable to the information required for a
discloseable transaction under Chapter 14 of the Hong Kong Listing Rules,
including, among others: (a) a general description of the principal business activities
of the Target Group and the consolidated financial information of the Target
Company that are available to us; (b) confirmation that China Investment and its
ultimate beneficial owners are Independent Third Parties; (c) the consideration of
the proposed acquisition; (d) the basis on which the consideration is determined; (e)
how the consideration is expected to be satisfied; and (f) the reasons for and benefits
of the proposed acquisition.
W AIVER FROM STRICT COMPLIANCE WITH RULE 4.04(1) OF THE HONG KONG
LISTING RULES AND EXEMPTION FROM STRICT COMPLIANCE WITH
PARAGRAPH 27 OF PART I AND PARAGRAPH 31 OF PART II OF THE THIRD
SCHEDULE TO THE COMPANIES (WINDING UP AND MISCELLANEOUS
PROVISIONS) ORDINANCE
Rule 4.04(1) of the Hong Kong Listing Rules requires our Company to include in the
prospectus an accountant’s report covering the consolidated results of our Group in respect of
each of the three financial years immediately preceding the issue of the prospectus or such
shorter period as may be acceptable to the Hong Kong Stock Exchange.
Pursuant to section 342(1) of the Companies (Winding Up and Miscellaneous Provisions)
Ordinance, a prospectus shall include the matters specified in Part I of the Third Schedule to
the Companies (Winding Up and Miscellaneous Provisions) Ordinance and set out the reports
specified in Part II of the Third Schedule to the Companies (Winding Up and Miscellaneous
Provisions) Ordinance.
Paragraph 27 of Part I of the Third Schedule to the Companies (Winding Up and
Miscellaneous Provisions) Ordinance requires our Company to include in the prospectus a
statement as to the gross trading income or sales turnover (as may be appropriate) of our Group
during each of the three financial years immediately preceding the issue of the prospectus as
well as an explanation of the method used for the computation of such income or turnover and
a reasonable breakdown of the more important trading activities.
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Paragraph 31 of Part II of the Third Schedule to the Companies (Winding Up and
Miscellaneous Provisions) Ordinance requires us to include in the prospectus a report by
auditors of our Company with respect to the financial results of our Group for each of the three
financial years immediately preceding the issue of the prospectus.
Pursuant to section 342A(1) of the Companies (Winding Up and Miscellaneous
Provisions) Ordinance, the SFC may issue, subject to such conditions (if any) as the SFC thinks
fit, a certificate of exemption from compliance with the relevant requirements under the
Companies (Winding Up and Miscellaneous Provisions) Ordinance if, having regard to the
circumstances, the SFC considers that the exemption will not prejudice the interests of the
investing public and compliance with any or all of such requirements would be irrelevant or
unduly burdensome, or is otherwise unnecessary or inappropriate.
Appendix IIA to Chapter 1.1A of the Guide has provided the conditions for granting a
waiver from strict compliance with Rule 4.04(1) of the Hong Kong Listing Rules as follows:
(i) the applicant must list on the Hong Kong Stock Exchange within three months after
the latest financial year end;
(ii) the applicant must obtain a certificate of exemption from the SFC on compliance
with section 342(1) of and paragraphs 27 and 31 of the Third Schedule to the
Companies (Winding Up and Miscellaneous Provisions) Ordinance requirements;
(iii) a profit estimate for the latest financial year (which must comply with Rules 11.17
to 11.19 of the Hong Kong Listing Rules) must be included in the prospectus or the
applicant must provide justification why a profit estimate cannot be included in the
prospectus; and
(iv) there must be a directors’ statement in the prospectus that there is no material
adverse change to its financial and trading position or prospects with specific
reference to the trading results from the end of the stub period to the latest financial
year end.
The Accountant’s Report for each of the three years ended December 31, 2023 and nine
months ended September 30, 2024 has been prepared and set out in Appendix IA to this
Prospectus.
W AIVERS FROM STRICT COMPLIANCE WITH THE HONG KONG LISTING RULES AND EXEMPTION FROM
STRICT COMPLIANCE WITH THE COMPANIES (WINDING UP AND MISCELLANEOUS PROVISIONS) ORDINANCE
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--- page 159 ---
Pursuant to the relevant requirements set forth above, our Company is required to include
three full years of audited accounts for the three years ended December 31, 2024. As such, an
application has been made to the Hong Kong Stock Exchange for a waiver from strict
compliance with Rule 4.04(1) of the Hong Kong Listing Rules, and such waiver has been
granted by the Hong Kong Stock Exchange on the conditions that:
(i) this Prospectus will be issued on or before February 28, 2025 and the H Shares will
be listed on or before March 31, 2025, that is, three months after the latest financial
year end;
(ii) inclusion in this Prospectus a profit estimate for the year ended December 31, 2024
in compliance with Rules 11.17 to 11.19 of the Hong Kong Listing Rules and a
Directors’ statement that there is no material and adverse change to the financial and
trading positions or prospects of our Company, with specific reference to the trading
results from October 1, 2024 to December 31, 2024; and
(iii) our Company obtains a certificate of exemption from the SFC on strict compliance
with paragraph 27 of Part I and paragraph 31 of Part II of the Third Schedule to the
Companies (Winding Up and Miscellaneous Provisions) Ordinance.
An application has also been made to the SFC for a certificate of exemption from strict
compliance with the requirements under section 342(1) of the Companies (Winding Up and
Miscellaneous Provisions) Ordinance in relation to paragraph 27 of Part I and paragraph 31 of
Part II of the Third Schedule to the Companies (Winding Up and Miscellaneous Provisions)
Ordinance and a certificate of exemption has been granted by the SFC under section 342A of
the Companies (Winding Up and Miscellaneous Provisions) Ordinance on the conditions that:
(i) the particulars of the exemption are disclosed in this Prospectus;
(ii) this Prospectus will be issued on or before February 28, 2025; and
(iii) our Company shall be listed on the Hong Kong Stock Exchange on or before March
31, 2025.
W AIVERS FROM STRICT COMPLIANCE WITH THE HONG KONG LISTING RULES AND EXEMPTION FROM
STRICT COMPLIANCE WITH THE COMPANIES (WINDING UP AND MISCELLANEOUS PROVISIONS) ORDINANCE
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--- page 160 ---
The applications to the Stock Exchange for a waiver from strict compliance with Rule
4.04(1) of the Hong Kong Listing Rules and the SFC for a certificate of exemption from strict
compliance with the requirements under section 342(1) of the Companies (Winding Up and
Miscellaneous Provisions) Ordinance in relation to paragraph 27 of Part I and paragraph 31 of
Part II of the Third Schedule to the Companies (Winding Up and Miscellaneous Provisions)
Ordinance were made on the grounds, among others, that the waiver and exemption from the
above requirements will not prejudice the interest of the investing public and strict compliance
with the above requirements would be unduly burdensome given the following:
(i) there will not be sufficient time for our Company and the Reporting Accountants to
finalize the audited consolidated financial statements for the year ended December
31, 2024 for inclusion in this Prospectus. If the financial information for the year
ended December 31, 2024 is required to be audited, our Company and the Reporting
Accountants would have to carry out substantial volume of work to prepare, update
and finalize the Accountants’ Report and this Prospectus, and the relevant sections
of this Prospectus will need to be updated to cover such additional period. This
would involve additional time and costs since substantial work is required to be
carried out for audit purposes. It would be unduly burdensome for the audited results
for the year ended December 31, 2024 to be finalized in a short period of time. Our
Directors consider that the benefits of such work to the existing and prospective
shareholders of our Company may not justify the additional work and expenses
involved and the delay of the Listing timetable;
(ii) our Directors and the Sole Sponsor confirm that after performing all reasonable due
diligence work which they consider appropriate, up to the date of this Prospectus,
except to the extent disclosed in the section headed “Summary — Recent
Development and No Material Adverse Change” in this Prospectus, there has been
no material adverse change to the financial and trading positions or prospects of our
Group since October 1, 2024 (immediately following the date of the latest audited
statement of financial position in the Accountants’ Report set out in Appendix IA to
this Prospectus) up to the date of this Prospectus and there has been no event which
would materially affect the information shown in the Accountants’ Report as set out
in Appendix IA to this Prospectus, the financial information section, the profit
estimate as set out in Appendix IIB to this Prospectus and information regarding our
Company’s recent development subsequent to the Track Record Period and the date
of this Prospectus, since October 1, 2024;
(iii) our Company is of the view that the Accountants’ Report covering the three years
ended December 31, 2023 and the nine months ended September 30, 2024, together
with the profit estimate for the year ended December 31, 2024 (in compliance with
Rules 11.17 to 11.19 of the Hong Kong Listing Rules) included in this Prospectus
have already provided the potential investors with adequate and reasonably
up-to-date information in the circumstances to form a view on the track record and
earnings trend of our Company; and our Directors and the Sole Sponsor confirm that
W AIVERS FROM STRICT COMPLIANCE WITH THE HONG KONG LISTING RULES AND EXEMPTION FROM
STRICT COMPLIANCE WITH THE COMPANIES (WINDING UP AND MISCELLANEOUS PROVISIONS) ORDINANCE
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--- page 161 ---
all information which is necessary for the investing public to make an informed
assessment of the activities, assets and liabilities, financial position, trading
position, management and prospects included in this Prospectus. Therefore, the
waiver and exemption would not prejudice the interests of the investing public; and
(iv) our Company will comply with the requirements under Rules 13.46(2) and 13.49(1)
of the Hong Kong Listing Rules in respect of the publication of our annual results
and annual report. Our Company currently expects to issue our annual results and
annual report for the financial year ended December 31, 2024 on or before March
31, 2025 and April 30, 2025, respectively. In this regard, our Directors consider that
the Shareholders, the investing public as well as potential investors of our Company
will be kept informed of the financial results of our Group for the year ended
December 31, 2024.
W AIVER IN RESPECT OF PUBLIC FLOAT REQUIREMENTS
Rule 8.08(1)(a) and (b) (as amended by Rule 19A.13A) of the Hong Kong Listing Rules
states that there must be an open market in the securities for which listing is sought. This will
normally mean that: (a) at least 25% of the issuer’s total number of issued shares must at all
times be held by the public; (b) where an issuer has one class of securities or more apart from
the class of securities for which listing is sought, the total securities of the issuer held by the
public (on all regulated market(s) including the Hong Kong Stock Exchange) at the time of
listing must be at least 25% of the issuer’s total number of issued shares. However, the class
of securities for which listing is sought must not be less than 15% of the issuer’s total number
of issued shares, having an expected market capitalisation at the time of listing of not less than
HK$125,000,000. Rule 19A.13A further provides that Rule 8.08 of the Hong Kong Listing
Rules is amended by adding the following provision to sub-paragraph (1)(b): Where a PRC
issuer has shares apart from the H shares for which listing is sought, the total securities of the
issuer held by the public (on all regulated market(s) including the Stock Exchange) at the time
of listing must be at least 25% of the issuer’s total number of issued shares (excluding treasury
shares). However, the issuer’s H shares (for which listing is sought) must represent at least 15%
of its total number of issued shares (excluding treasury shares), having an expected market
capitalisation at the time of listing of not less than HK$125,000,000.
W AIVERS FROM STRICT COMPLIANCE WITH THE HONG KONG LISTING RULES AND EXEMPTION FROM
STRICT COMPLIANCE WITH THE COMPANIES (WINDING UP AND MISCELLANEOUS PROVISIONS) ORDINANCE
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--- page 162 ---
We have made an application to the Hong Kong Stock Exchange and the Hong Kong
Stock Exchange has granted, a waiver from strict compliance with Rule 8.08(1)(b) (as amended
by Rule 19A.13A) of the Hong Kong Listing Rules that the minimum percentage of the H
Shares of our Company to be held by the public from time to time shall be the higher of (a)
11% (assuming no exercise of the Offer Size Adjustment Option and the Over-allotment
Option) and (b) such percentage of H Shares to be held by the public immediately after
completion of the Global Offering, as increased by the H Shares to be issued upon any exercise
of the Offer Size Adjustment Option and the Over-allotment Option, of the total enlarged
issued share capital of the Company, subject to the following:
(a) our Company will comply with the public float requirement under Rule 8.08 (as
amended by Rule 19A.13A) of the Hong Kong Listing Rules where at least 25% of
our Company’s total number of issued shares (A Shares and H Shares in aggregate)
must be held by the public from time to time;
(b) our Company will announce the percentage of H Shares held by the public
immediately after the completion of the Global Offering (before any exercise of the
Offer Size Adjustment Option and/or after any exercise of the Over-allotment
Option);
(c) our Company will confirm the sufficiency of public float in successive annual
reports after Listing; and
(d) our Company will implement appropriate measures and mechanisms to ensure
continual maintenance of the minimum public float of H Shares of the higher of (a)
11% (assuming no exercise of the Offer Size Adjustment Option and the Over-
allotment Option) and (b) such percentage of H Shares to be held by the public
immediately after completion of the Global Offering, as increased by the H Shares
to be issued upon any exercise of the Offer Size Adjustment Option and the
Over-allotment Option, of the total enlarged issued share capital of the Company.
Furthermore, it is expected that after the Listing, our Company may consider
implementing H Shares incentive scheme or other share incentive initiatives involving issuance
of new H Shares, which may increase the total number of and size of our H Shares and enhance
the public float and liquidity of our H Shares after the Listing.
W AIVERS FROM STRICT COMPLIANCE WITH THE HONG KONG LISTING RULES AND EXEMPTION FROM
STRICT COMPLIANCE WITH THE COMPANIES (WINDING UP AND MISCELLANEOUS PROVISIONS) ORDINANCE
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DIRECTORS’ RESPONSIBILITY STATEMENT
This Prospectus, for which our Directors collectively and individually accept full
responsibility, includes particulars given in compliance with the Companies (Winding Up and
Miscellaneous Provisions) Ordinance, the Securities and Futures (Stock Market Listing) Rules
(Chapter 571V of the Laws of Hong Kong) and the Hong Kong Listing Rules for the purpose
of giving information with regard to us. Our Directors, having made all reasonable enquiries,
confirm that to the best of their knowledge and belief the information contained in this
Prospectus is accurate and complete in all material respects and not misleading or deceptive,
and there are no other matters the omission of which would make any statement herein or this
Prospectus misleading.
FILING PROCEDURES WITH THE CSRC
Our filing procedures with the CSRC for the submission of the application to list our H
Shares on the Hong Kong Stock Exchange and for the Global Offering were completed on
December 19, 2024. In completing such filing, the CSRC accepts no responsibility for our
financial soundness, nor for the accuracy of any of the statements made or opinions expressed
in this Prospectus. No other filings in the PRC are required to be completed for the listing of
the H Shares on the Hong Kong Stock Exchange.
UNDERWRITING AND INFORMATION ON THE GLOBAL OFFERING
This Prospectus is published solely in connection with the Hong Kong Public Offering
which forms part of the Global Offering. For applicants under the Hong Kong Public Offering,
this Prospectus contain the terms and conditions of the Hong Kong Public Offering. The Global
Offering comprises the Hong Kong Public Offering of initially 20,565,200 H Shares and the
International Offering of initially 185,086,800 H Shares (subject, in each case, to reallocation
on the basis described in the section headed “Structure of the Global Offering” in this
Prospectus and any exercise of the Offer Size Adjustment Option and, in case of the
International Offering, to any exercise of the Over-allotment Option).
The listing of the Offer Shares on the Hong Kong Stock Exchange is sponsored by the
Sole Sponsor. Pursuant to the Hong Kong Underwriting Agreement, the Hong Kong Public
Offering is underwritten by the Hong Kong Underwriters on a conditional basis, with one of
the conditions being that the Offer Price is agreed between the Overall Coordinators and us.
The International Offering is managed by the Overall Coordinators and is underwritten by the
International Underwriters. The International Underwriting Agreement is expected to be
entered into on or about the Price Determination Date, subject to agreement on the Offer Price
between our Company and the Overall Coordinators. If, for any reason, the Offer Price is not
agreed between our Company and the Overall Coordinators on or before the Price
Determination Date, or such later date or time as may be agreed between the Overall
Coordinators and our Company, the Global Offering will not proceed. Further details about the
Underwriters and the underwriting arrangements are contained in the section headed
“Underwriting” in this Prospectus.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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--- page 164 ---
INFORMATION ABOUT THIS PROSPECTUS
Y ou should rely only on the information contained in this Prospectus to make your
investment decision. We have not authorized anyone to provide you with information that is
different from what is contained in this Prospectus. Any information or representation not made
in this Prospectus must not be relied on by you as having been authorized by us, the Sole
Sponsor, the Sponsor Overall Coordinators, the Overall Coordinators, the Joint Global
Coordinator, the Joint Bookrunner, the Joint Lead Manager, any of the Underwriters, any of our
or their respective directors, officers or representatives or any other person involved in the
Global Offering. Neither the delivery of this Prospectus nor any offering, sale or delivery made
in connection with the H Shares should, under any circumstances, constitute a representation
that there has been no change or development reasonably likely to involve a change in our
affairs since the date of this Prospectus or imply that the information contained in this
Prospectus is correct as of any date subsequent to the date of this Prospectus.
This Prospectus is published solely in connection with the Hong Kong Public Offering,
which forms part of the Global Offering. For applicants under the Hong Kong Public Offering,
this Prospectus set out the terms and conditions of the Hong Kong Public Offering.
RESTRICTIONS ON OFFERS AND SALES OF THE H SHARES
Each person acquiring the Hong Kong Offer Shares under the Hong Kong Public Offering
will be required to confirm, or be deemed by his or her acquisition of Hong Kong Offer Shares
to confirm, that he or she is aware of the restrictions on offers and sales of the Offer Shares
described in this Prospectus. In particular, the Offer Shares have not been offered or sold, and
will not be offered or sold, directly or indirectly, in the PRC.
No action has been taken to permit a public offering of the H Shares or the general
distribution of this Prospectus in any jurisdiction other than in Hong Kong. Accordingly, this
Prospectus may not be used for the purposes of, and does not constitute, an offer or invitation
in any jurisdiction or in any circumstances in which such an offer or invitation is not authorized
or to any person to whom it is unlawful to make such an offer or invitation. The distribution
of this Prospectus and the offering of the Offer Shares in other jurisdictions are subject to
restrictions and may not be made except as permitted under the applicable securities laws of
such jurisdictions and pursuant to registration with or authorization by the relevant securities
regulatory authorities or an exemption therefrom.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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--- page 165 ---
APPLICATION FOR LISTING OF THE H SHARES ON THE HONG KONG STOCK
EXCHANGE
We have applied to the Listing Committee for the listing of, and permission to deal in, the
H Shares to be issued pursuant to the Global Offering (including any H Shares which may be
issued pursuant to the exercise of the Offer Size Adjustment Option and/or the Over-allotment
Option). No part of the H Shares is listed on or dealt in on any other stock exchange, and no
such listing or permission to list is being or proposed to be sought in the near future.
Under section 44B(1) of the Companies (Winding Up and Miscellaneous Provisions)
Ordinance, any allotments made in respect of any applications will be invalid if the listing of,
and permission to deal in, the H Shares on the Hong Kong Stock Exchange is refused before
the expiration of three weeks from the date of the closing of the application lists, or such longer
period (not exceeding six weeks) as may, within the said three weeks, be notified to our
Company by the Hong Kong Stock Exchange.
COMPLIANCE WITH HONG KONG LISTING RULES
We will comply with applicable laws and regulations in Hong Kong (including the Hong
Kong Listing Rules) and any other undertakings which have been given in favor of the Hong
Kong Stock Exchange from time to time. If the Listing Committee finds that there has been a
breach by us of the Hong Kong Listing Rules or such other undertakings which may have been
given by us in favor of the Hong Kong Stock Exchange from time to time, the Listing
Committee may instigate cancellation or disciplinary proceedings in accordance with the Hong
Kong Listing Rules.
H SHARES WILL BE ELIGIBLE FOR ADMISSION INTO CCASS
Subject to the granting of the listing of, and permission to deal in, the H Shares (including
any H Shares which may be issued pursuant to the exercise of the Offer Size Adjustment Option
and/or the Over-allotment Option) on the Hong Kong Stock Exchange and compliance with the
stock admission requirements of HKSCC, the H Shares will be accepted as eligible securities
by HKSCC for deposit, clearance and settlement in CCASS with effect from the Listing Date
or on any other date as determined by HKSCC. Settlement of transactions between participants
of the Hong Kong Stock Exchange is required to take place in CCASS on the second settlement
day after any trading day. All activities under CCASS are subject to the General Rules of
HKSCC and the HKSCC Operational Procedures in effect from time to time.
All necessary arrangements have been made for the H Shares to be admitted into CCASS.
Investors should seek the advice of their stockbroker or other professional advisor for details
of those settlement arrangements and how such arrangements will affect their rights and
interests.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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--- page 166 ---
PROCEDURES FOR APPLICATION FOR HONG KONG OFFER SHARES
The procedures for applying for Hong Kong Offer Shares are set out in the section headed
“How to Apply for Hong Kong Offer Shares” in this Prospectus.
H SHARE REGISTER OF MEMBERS AND STAMP DUTY
All H Shares issued pursuant to applications made in the Hong Kong Public Offering and
the International Offering will be registered on our Company’s H Share register of members to
be maintained by our H Share Registrar, Computershare Hong Kong Investor Services Limited,
in Hong Kong. We will maintain our Company’s principal register of members at our current
registered office in the PRC.
Dealings in our H Shares registered in the H Share register of members of our Company
in Hong Kong will be subject to Hong Kong stamp duty. See the section headed “Taxation and
Foreign Exchange” in Appendix IV to this Prospectus for further details.
DIVIDENDS PAYABLE TO HOLDERS OF H SHARES
Unless determined otherwise by our Company, dividends payable in Hong Kong dollars
in respect of the H Shares will be paid to the Shareholders as recorded on the H Share register
of members of our Company in Hong Kong and sent by ordinary post, at the Shareholders’ risk,
to the registered address of each Shareholder.
According to the Guide to the Program for “Full Circulation” of H shares promulgated by
CSDC on February 7, 2020, cash dividends to domestic investors of H-share “full circulation”
shall be distributed through CSDC. An H-share listed company shall transfer RMB cash
dividends to the designated bank account of the Shenzhen subsidiary of CSDC, who shall
complete the clearing of cash dividends by distributing the cash dividends to investors through
domestic securities companies.
REGISTRATION OF SUBSCRIPTION, PURCHASE AND TRANSFER OF H SHARES
Persons applying for or purchasing H Shares under the Global Offering are deemed, by
their making an application or purchase, to have represented that they are not close associates
(as such term is defined in the Hong Kong Listing Rules) of any of our Directors or any
existing Shareholders or a nominee of any of the foregoing.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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--- page 167 ---
PROFESSIONAL TAX ADVICE RECOMMENDED
Y ou should consult your professional advisors if you are in any doubt as to the taxation
implications of subscribing for, purchasing, holding or disposing of, or dealing in, the H Shares
or exercising any rights attaching to the H Shares. We emphasize that none of our Company,
the Sole Sponsor, the Sponsor Overall Coordinators, the Overall Coordinators, the Joint Global
Coordinator, the Joint Bookrunner, the Underwriter, any of our or their respective directors,
officers or representatives or any other person involved in the Global Offering accepts
responsibility for any tax effects or liabilities resulting from your subscription, purchase,
holding or disposing of, or dealing in, the H Shares or your exercise of any rights attaching to
the H Shares.
EXCHANGE RATE CONVERSION
Unless otherwise specified, this Prospectus contains certain translations solely for your
convenience at the following rates:
US$1.0000 : HK$7.7770
RMB0.9221 : HK$1.0000
US$1.0000 : RMB7.1712
No estimation or representation is made that any amounts in HK$, RMB and US$ can be
or could have been converted at the relevant dates at the above rates or any other rates at all.
LANGUAGE
If there is any inconsistency between this Prospectus and the Chinese translation of this
Prospectus, this Prospectus shall prevail unless otherwise stated. However, the English names
of the PRC national, entities, departments, facilities, certificates, titles, laws, regulations
(including certain of our subsidiaries) and the like included in this Prospectus are translations
of their Chinese names and are included for identification purposes only. If there is any
inconsistency, the names in their original languages shall prevail.
COMMENCEMENT OF DEALING IN THE H SHARES
Dealings in the H Shares on the Hong Kong Stock Exchange are expected to commence
at 9:00 a.m. on Monday, March 10, 2025. The H Shares will be traded in board lots of 200 H
Shares each and all Offer Shares will be registered on the H Share Registrar in order to enable
them to be traded on the Hong Kong Stock Exchange.
ROUNDING
Certain amounts and percentage figures included in this Prospectus have been subject to
rounding adjustments. Accordingly, figures shown as totals in certain tables may not be an
arithmetic aggregation of the figures preceding them.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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DIRECTORS
Name Address Nationality
Executive Directors
Mr. Wang Jianhua (ശ) Room 1009, Building 2
A7 Xiaojing
Wanfeng Road
Fengtai District
Beijing
PRC
Chinese
Ms. Y ang Yi-fang (˙)
(also known as Lydia Y ang)
Flat 19C
147-151 King’s Road
North Point
Hong Kong
Canadian
Mr. Lyu Xiaozhao ( ѐወΊ)
(former name: Lu Xiaozhao)
102, Unit 1
1/F, Building 6
Court No. 8, Linquan Street
Chaoyang District
Beijing
PRC
Chinese
Mr. Gao Bo (ت901, Unit 1
9/F, Building 3
Fourth Court, Dexiu North Street
Fengtai District
Beijing
PRC
Chinese
Non-executive Director
Mr. Zhang Xudong (؇Room 601, No. 47
Mingshen Garden
Alley No. 633, Wuzhong Road
Shanghai
PRC
Chinese
(Hong Kong)
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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--- page 169 ---
Independent Non-executive Directors
Dr. Mao Jingwen ( ˣ౻˖) No. 35, Zhonglangxia Hutong
Xicheng District
Beijing
PRC
Chinese
Dr. Shen Zhengchang (׹݁No. 18, 1st Door
Building No. 5
Zhenwu Temple 5th Lane
Xicheng District
Beijing
PRC
Chinese
Mr. Hu Nailian (ɗஹ)
(former name:ɗᑌ)
Room 1102
5th Door, 1/F
Bairuyuan
11 Linbei Road
Haidian District
Beijing
PRC
Chinese
Dr. Wong Y et Ping Ambrose
(රɓ̻)
Unit D, 8/F
Merrill Court
42 Broadcast Drive
Kowloon Tong
Hong Kong
Chinese (Hong
Kong)
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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--- page 170 ---
SUPERVISORS
Name Address Nationality
Mr. Cheng Zhenlong (Ꮂ) 601, Unit 5
Zhonglian Apartment
Y ulong Main Street
Songshan District
Chifeng
Inner Mongolia Autonomous Region
PRC
Chinese
Mr. Ji Hongyong (ۇߎ֙1101, Unit 3
Building D2
Binhe International Precinct
Binshui Road
Huadian
Jilin Province
PRC
Chinese
Mr. Liu Fengwu ( ᄎჾͼ) No. 2, Unit 2
Block 31
Family Building
Pingju Zhonglou Precinct
Y uanbaoshan District
Chifeng
Inner Mongolia Autonomous Region
PRC
Chinese
For further details regarding our Directors and Supervisors, see the section headed
“Directors, Supervisors and Senior Management” in this Prospectus.
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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--- page 171 ---
PARTIES INVOLVED IN THE GLOBAL OFFERING
Sole Sponsor CITIC Securities (Hong Kong) Limited
(a licensed corporation under the SFO to engage in
type 4 (advising on securities) and type 6 (advising
on corporate finance) regulated activities)
18/F, One Pacific Place
88 Queensway
Hong Kong
Sponsor-Overall Coordinator,
Joint Global Coordinator,
Joint Bookrunner and
Joint Lead Manager
CLSA Limited
(a licensed corporation under the SFO to engage in
type 1 (dealing in securities), type 4 (advising on
securities) and type 7 (providing automated trading
services) regulated activities)
18/F, One Pacific Place
88 Queensway
Hong Kong
Overall Coordinator, Joint Global
Coordinator, Joint Bookrunner
and Joint Lead Manager
Macquarie Capital Limited
Level 22
One International Finance Centre
1 Harbour View Street
Central
HONG KONG
Joint Global Coordinator, Joint
Bookrunner and Joint Lead
Manager
China International Capital Corporation Hong
Kong Securities Limited
29/F One International Finance Centre
1 Harbour View Street
Central
Hong Kong
Joint Bookrunners and Joint Lead
Managers
ABCI Capital Limited
(acting as Joint Bookrunner only)
11/F, Agricultural Bank of China Tower,
50 Connaught Road
Central, Hong Kong
ABCI Securities Company Limited
(acting as Joint Lead Manager only)
10/F, Agricultural Bank of China Tower,
50 Connaught Road Central,
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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--- page 172 ---
BOCI Asia Limited
26/F, Bank of China Tower
1 Garden Road, Central
Hong Kong
ICBC International Securities Limited
37/F, ICBC Tower
3 Garden Road
Hong Kong
Huatai Financial Holdings (Hong Kong) Limited
62/F, The Center
99 Queen’s Road Central
Hong Kong
CCB International Capital Limited
12/F CCB Tower
3 Connaught Road Central
Central, Hong Kong
First Shanghai Securities Limited
19/F., Wing On House
71 Des V oeux Road Central
Hong Kong
Joint Lead Managers Futu Securities International (Hong Kong)
Limited
34/F, United Centre
No. 95 Queensway
Admiralty, Hong Kong
Livermore Holdings Limited
Unit 1214A 12/F Tower II Cheung Sha Wan Plaza
833 Cheung Sha Wan Road
Kowloon, Hong Kong
Shenwan Hongyuan Securities (H.K.) Limited
Level 6, Three Pacific Place
1 Queen’s Road East
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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--- page 173 ---
The Standard Bank of South Africa Limited
(in relation to the International Offering only)
5 Simmonds Street Johannesburg 2001
South Africa
Victory Securities Company Limited
11th Floor, Y ardley Commercial Building
3 Connaught Road West
Sheung Wan, Hong Kong
Star River Securities Limited
Room 2402, Wing On Centre
111 Connaught Road
Central, Hong Kong
Tiger Brokers (HK) Global Limited
1/F, No. 308 Des V oeux Road Central
Sheung Wan, Hong Kong
Legal Advisors to our Company as to Hong Kong and United States laws:
DLA Piper Hong Kong
25th Floor
Three Exchange Square
8 Connaught Place
Central
Hong Kong
as to PRC laws:
Beijing Tian Yuan Law Firm
Suite 509
Tower A, Corporate Square
35 Financial Street
Xicheng District
Beijing 100033
PRC
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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--- page 174 ---
as to Ghana laws:
REM Law Consultancy
P . O. Box CT 4600
Cantonments-Accra
No. 15 Kofi Annan Avenue
North Legon, Residential Area
Accra
Republic of Ghana
as to Laos laws:
ZICOLaw (Laos) Sole Co., Ltd.
6th Floor Vieng V ang Tower
Bourichane Road, Unit 15
Dongpalane Thong Village
Sisattanak District
Vientiane Capital
Lao People’s Democratic Republic
Legal Advisors to the Sole Sponsor
and the Underwriters
as to Hong Kong and United States laws:
Linklaters
11/F, Alexandra House
Chater Road
Central
Hong Kong
as to PRC laws:
JunHe LLP
20/F, China Resources Building
8 Jianguomenbei Avenue
Beijing 100005
PRC
Competent Person SRK Consulting (China) Ltd.
B1301 COFCO Plaza
No. 8 Jianguomennei Avenue
Dongcheng District
Beijing 100005
PRC
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
– 163 –


--- page 175 ---
Auditor and Reporting Accountants Ernst & Y oung
Certified Public Accountants
Registered Public Interest Entity Auditor
27/F, One Taikoo Place
979 King’s Road
Quarry Bay
Hong Kong
Industry Consultant Frost & Sullivan (Beijing) Inc., Shanghai
Branch Co.
2504, Wheelock Square
1717 Nanjing West Road
Shanghai 200040
PRC
Receiving Banks Standard Chartered Bank (Hong Kong) Limited
18/F, Standard Chartered Tower
388 Kwun Tong Road
Hong Kong
Industrial and Commercial Bank of China (Asia)
Limited
33/F.
ICBC Tower
3 Garden Road
Central Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
– 164 –


--- page 176 ---
Registered Office Fumin Village
Sidaowanzi Town
Aohan County, Chifeng
Inner Mongolia Autonomous Region
PRC
Headquarters and Principal Place
of Business in the PRC
A7 Xiaojing
Wanfeng Road
Fengtai District
Beijing
PRC
Principal Place of Business
in Hong Kong
Room 1905, 19th Floor
China Resources Building
26 Harbour Road
Wanchai
Hong Kong
Company’s Website cfgold.com
(the information contained on the website
does not form part of this Prospectus )
Company Secretary Mr. Wong Hok Bun Mario
Room 1905, 19th Floor
China Resources Building
26 Harbour Road
Wanchai
Hong Kong
Authorized Representatives Ms. Y ang Yi-fang
Room 1905, 19th Floor
China Resources Building
26 Harbour Road
Wanchai
Hong Kong
Mr. Wong Hok Bun Mario
Room 1905, 19th Floor
China Resources Building
26 Harbour Road
Wanchai
Hong Kong
CORPORATE INFORMATION
– 165 –


--- page 177 ---
Strategy and Sustainability Committee Mr. Wang Jianhua ( chairman )
Ms. Y ang Yi-fang
Mr. Lyu Xiaozhao
Mr. Zhang Xudong
Dr. Wong Y et Ping Ambrose
Audit Committee Dr. Wong Y et Ping Ambrose ( chairman )
Mr. Zhang Xudong
Mr. Hu Nailian
Nomination Committee Mr. Hu Nailian ( chairman )
Mr. Lyu Xiaozhao
Dr. Shen Zhengchang
Dr. Wong Y et Ping Ambrose
Remuneration and Appraisal Committee Mr. Hu Nailian ( chairman )
Ms. Y ang Yi-fang
Dr. Mao Jingwen
Dr. Shen Zhengchang
Compliance Advisor Goldlink Capital (Corporate Finance)
Limited
28/F, Bank of East Asia
Harbour View Centre
56 Gloucester Road
Wanchai
Hong Kong
H Share Registrar Computershare Hong Kong Investor
Services Limited
Shop 1712-1716, 17th Floor
Hopewell Centre
183 Queen’s Road East
Wan Chai
Hong Kong
Principal Banks China CITIC Bank Chifeng Branch
Jiutian Jianhua
Linhuang Street
Songshan District
Chifeng
Inner Mongolia Autonomous Region
PRC
CORPORATE INFORMATION
– 166 –


--- page 178 ---
Industrial and Commercial Bank of China
Chifeng Branch
No. 1, Third South Section
Hada Street
Hongshan District
Chifeng
Inner Mongolia Autonomous Region
PRC
China Construction Bank Corporation
Chifeng Ninglan Road Sub-branch
Steel West Street
Hongshan District
Chifeng
Inner Mongolia Autonomous Region
PRC
Agricultural Bank of China Limited
Beijing Chaoyang Road North Sub-branch
No. 4, North Lane
West End
Liulitun
Chaoyang District
Beijing
China
China Everbright Bank Co., Ltd.
Hohhot Branch
Chilechuan Street
Saihan District
Hohhot
Inner Mongolia Autonomous Region
PRC
Industrial Bank Co., Ltd. Hohhot Branch
Block F, Wanda Plaza
No. 4 University East Street
Saihan District
Hohhot
Inner Mongolia Autonomous Region
PRC
China Merchants Bank Hohhot Branch
China Merchants Bank Building
No. 9 Chilechuan Street
Hohhot
Inner Mongolia Autonomous Region
PRC
CORPORATE INFORMATION
– 167 –


--- page 179 ---
The information and statistics set out in this section and other sections of this
Prospectus were extracted from the Frost & Sullivan Report prepared by Frost &
Sullivan, which was commissioned by us, and from various official government
publications and other publicly available publications. We engaged Frost & Sullivan to
prepare the Frost & Sullivan Report, an independent industry report, in connection
with the Global Offering. The information from official government sources has not
been independently verified by us, the Sole Sponsor, the Sponsor Overall Coordinators,
the Overall Coordinators, the Sole Global Coordinator, the Sole Bookrunner, the Sole
Lead Manager, the Underwriter, any of our or their respective directors, supervisors,
officers, representatives, employees, advisors or any other persons or parties involved
in the Global Offering, and no representation is given as to its accuracy.
SOURCE AND RELIABILITY OF INFORMATION
We have commissioned Frost & Sullivan, an Independent Third Party, to conduct a study
of global and China’s gold and other non-ferrous metals industry. We agreed to pay Frost &
Sullivan a fee of RMB900,000 for the preparation of the Frost & Sullivan Report, and our
Directors consider that such fee reflects market rates and are of the view that the payment of
the fee does not affect the fairness of conclusions drawn in the Frost & Sullivan Report.
Founded in 1961, Frost & Sullivan has over 45 offices globally with more than 3,000 industry
consultants, market research analysts, technology analysts and economists.
RESEARCH METHODOLOGY
During the preparation of the Frost & Sullivan Report, Frost & Sullivan conducted
primary research that involved discussing the status of the industry with industry participants
and industry experts, as well as secondary research that involved reviewing company reports,
independent research reports and Frost & Sullivan’s own database. Our Directors have
confirmed that there has been no adverse change in the market situation since the date of Frost
& Sullivan Report which may qualify, contradict, or have impact on the information of this
section.
BASIS AND ASSUMPTION
The Frost & Sullivan Report was compiled based on the following assumptions: (i)
government policies on gold and gold mining industries in China and major overseas countries
discussed will remain consistent during the forecast period; (ii) government policies on copper
and other industries discussed in China and major overseas countries discussed will remain
consistent during the forecast period; (iii) the global and Chinese gold and gold mining market
will be driven by the factors which are stated in Frost & Sullivan Report; and (iv) the global
and Chinese copper and other industries discussed will be driven by the factors which are
stated in Frost & Sullivan Report.
INDUSTRY OVERVIEW
– 168 –


--- page 180 ---
OVERVIEW OF THE GOLD INDUSTRY
Introduction of Gold
Gold is a precious metal that has been used for coinage, jewellery, and arts throughout
recorded history. It is also widely used in high-tech manufacturing, such as electronics,
telecommunication, and aerospace. Gold products include physical gold such as gold bullion,
gold doré, and gold coins, gold concentrate produced during the smelting of gold products, and
gold derivatives. Gold doré, as a semi-pure alloy of gold and silver, is typically refined and
further purified with the end product being gold bullion, which refers to high purity physical
gold with no less than 99.5% gold content (such as gold bars, coins and medals). Gold
concentrate powder refers to the processing of gold ore into mineral powder through crushing,
grinding, and beneficiation, with its main components being gold, silicon dioxide, and so on.
The semi-finished gold produced in the last step of the gold smelting process is called
gold-loaded carbon.
Gold Global Trading Activities
Exploration
companies
Junior
mining
companies
Artisanal
miners
Major
mining
companies
Reserves
Doré Refiners Bullion
Jewellery
Investment
Central Bank
Technology/Industry
Bullion
The downstream consumption field of gold
Metal
 exchanges
e.g. SGE, DGCX,
 LME
OTC markets
e.g. London,
Zurich
Reserves
Exploration Production Refining Bullion trade
Fabrication/
Financial
products
Distribution Use
Source: World Gold Council, Frost & Sullivan
INDUSTRY OVERVIEW
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--- page 181 ---
The following diagram sets forth the gold industry’s value chain:
Value Chain of the Global Gold Industry
Procedures conducted by the Company
Equipment
Utilities
Chemical
Reagent
Gold
Smelting
Companies
Gold
Fabrication
and Sales
Companies
Jewellery
Industry/
Technology
Investment
Central Bank
Raw Material
and Equipment Gold Mining Gold Processing Gold Refining
and Smelting
End Products
for
Consumers
Gold
Recycling
Gold Mining Companies
Once the
potential deposit
is discovered,
the feasibility
and mining
methods will be
determined.
Exploration
Heap Leaching
Gold ore reacts
with a cyanide
solution, causing
the gold in the
o r et od i s s o l v e
into the solution,
forming a gold-
containing
solution that
seeps out of the
ore heap.
Filtered Ore
Solid particles
are intercepted
by the filtering
medium, while
the gold-
containing
solution flows
through the
filtering medium,
thereby
achieving solid-
liquid separation.
Gold
Filtration
Gold
Concentrate
Gold is
precipitated
from the
solution through
ac h e m i c a l
reaction,
forming solid
gold
Precipitation
Unpurified
Gold Dore
The precipitated
gold usually
needs to be
heated at high
temperatures to
further separate
impurities.
Roughing
Gold Dore
The ore is
extracted, as the
coarse ore.
Ore Mining
Gold Ore
Major Products
Source: Frost & Sullivan
Relevant information about China’s, Lao’s, and Ghana’s gold industry
China is the world’s largest gold producing country with resources in Shandong, Tibet,
and Gansu and other regions. In 2023, the gold resources in Shandong Province amounted to
1.4 million oz, accounting for 27.6% of the total national resources. China is also one of the
world’s largest gold consuming countries. China has introduced a series of plans such as the
Opinions on Further Strengthening the Work of Mine Safety Production (ආɓӉ̋੶ᘤʆ
จԈ) and Notice on the Guarantee of Mining Land (ٙ
ٝto ensure the production safety of mines. Laos is one of the main gold producing
countries in Southeast Asia, and its Mineral Resources are mainly distributed in the southern
and central regions of the country. The Laotian Government actively encourages gold mining
and investment and has introduced relevant industrial policies to promote gold mining. As one
of the important gold producing countries in Africa, gold is one of Ghana’s important export
products. The Ghanaian Government has issued a series of policies to strengthen mining
regulation.
INDUSTRY OVERVIEW
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--- page 182 ---
Gold Demand
Global demand for gold is generally divided into the following categories: (i) jewellery,
(ii) investment (including gold bars, coins and exchange traded funds (“ ETF”)), (iii) central
bank reserves, and (iv) technological or industrial use. The following chart sets forth the
volume and breakdown of global gold demand for the periods indicated.
Gold Demand (by End Use), Global, 2019-2028E
0
Million ounces
20202019 2021 2022 2023 2024E 2025E 2026E 2027E 2028E
20
40
60
80
100
120
140
160
10.5
41.0
69.2
56.9
42.6
32.4
71.7
35.6
70.4
30.3
70.5
26.9
67.8
26.6
65.7
26.4
64.0
26.3
62.8
26.3
61.8
19.5 8.2 14.6
36.5 33.3 35.4 37.7 40.2 43.0 46.2
144.9142.7141.1140.2140.1143.7
152.4
129.3
117.4
140.1
9.7 10.6 9.9 9.6 10.1 10.3 10.5 10.5 10.6
Jewellery Investment Central Bank Technology/
Industry Total
CAGR 19-23 0.5% -7.3% 14.4% -2.2% 0.6%
CAGR 24E-28E -2.3% -0.5% 6.9% 1.2% 0.8%
Jewellery Investment Central Bank Technology/Industry
Source: World Gold Council, Frost & Sullivan
Global gold demand increased at a CAGR of 0.6% from 2019 to 2023, reaching 143.7
million oz in 2023. The decrease in gold demand as compared with 2022 is mainly attributed
to decrease in gold reserve demand by investment and central banks. A significant drop in gold
jewellery in 2020 followed by a rebound is noted, which was due to the outbreak of the
pandemic, rising gold price and economic recession in 2020. In 2021, driven by gradual control
of the pandemic, improved consumer sentiment and economic recovery, jewellery demand
achieved a rebound in 2021. From 2024 to 2028, global gold demand is expected to grow
steadily at a CAGR of 0.8% due to: (i) increase in gold demand by central banks for value
preservation and risk diversification, in the context of current geopolitical uncertainties such
as the tensions arising from events like the Israel-Palestine conflict and the Russia-Ukraine
conflict; and (ii) increase in gold demand for technology and industry.
INDUSTRY OVERVIEW
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--- page 183 ---
The following chart sets forth the volume and breakdown of China gold demand for the
periods indicated:
Gold Demand (by End Use), China, 2019-2028E
0
Million ounces
20202019 2021 2022 2023 2024E 2025E 2026E 2027E 2028E
5
10
15
20
25
30
35
40
3.2
7.3
21.7
8.4
15.8
10.3
22.9
8.0
21.0
7.3
20.3
7.1
19.2
7.5
18.2
7.8
17.3
8.0
16.5
8.2
15.8
3.4 2.0
7.2 6.5 5.9 7.0 8.4 10.1
37.436.235.334.635.7
37.5
33.8
36.3
26.9
35.6
2.7 3.1 2.8 2.8 3.0 3.1 3.1 3.2 3.2
Jewellery Investment Central Bank Technology/
Industry Total
CAGR 19-23 -1.8% 0.0% 20.8% -3.8% 1.3%
CAGR 24E-28E -4.7% 3.7% 11.7% 2.4% 1.1%
Jewellery Investment Central Bank Technology/Industry
Source: China Gold Association, Frost & Sullivan
Gold demand in China increased from 2019 to 2023 at a CAGR of 1.3%. During this
period, China’s gold demand experienced fluctuations, mainly influenced by the changes in the
demand for jewellery consumption. The decline in gold demand in 2020 was mainly due to the
lasting impact of COVID-19 on the consumer economy, which caused a significant decrease in
gold jewellery demand. China’s gold consumption saw a strong recovery in 2021, as gold
jewellery demand grew significantly, driven by economic recovery and a pullback in gold
prices from 2020. In 2023 due to the significant increase in the gold reserves of China’s central
bank, China’s gold demand achieved a year-on-year growth rate of 10.9%, with a total volume
of 37.5 million ounces. During the forecast period, China’s gold demand is expected to
maintain a stable level. Concerns about future economic uncertainties may suppress
consumers’ demand for jewellery, and also stimulate the central bank’s reserve growth and
investment demand. In the future, there will decrease in gold jewellery demand and increase
in gold demand for investment and central bank, resulting a stable level of gold demand in
China.
INDUSTRY OVERVIEW
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--- page 184 ---
Gold Supply
Generally, global and China’s gold supply has consistently maintained relatively stable.
The supply of gold is influenced by various factors, mainly including the grade, resources and
mining difficulty of gold mines, the market demand for gold, fluctuations in gold prices and
governments’ policies of gold mining industry. The following chart sets forth the global and
China’s gold mine production volume for the periods indicated:
Gold Supply*, Global and China, 2019-2028E
0
Million ounces
115.6 111.8 115.2 116.1 117.2 119.3 121.0 122.5 123.6 124.5
20202019 2021 2022 2023 2024E 2025E 2026E 2027E 2028E
100.1103.4 104.6 104.1 105.1 107.1 108.6 109.8 110.5 110.8
11.712.2 10.6 12.0 12.1 12.2 12.4 12.7 13.1 13.7
20
40
60
80
100
120
140
China Rest of the World
China RoW
CAGR 19-23 -0.3% 0.4%
CAGR 24E-28E 3.0% 0.8%
Global
0.3%
1.1%
* Global and China’s gold supplies include gold produced from gold mines and gold produced as by-product
from NFM ores.
Source: World Gold Council, China Gold Association, Frost & Sullivan
INDUSTRY OVERVIEW
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--- page 185 ---
Gold Supply and Demand, Global, 2019-2028E
Demand Supply
0
30
60
90
120
150
180
115.6
140.1
2019 2020 2021 2022 2023 2024E 2025E 2026E 2027E 2028E
Million ounces
111.8
117.4
115.2
129.3
117.2
143.7
119.3
140.1
121.0
140.2
122.5
141.1
123.6
142.7
124.5
144.9152.4
116.1
Supply
0.3%
1.1%
0.6%
0.8%
Demand
CAGR 24E-28E
CAGR 19-23
Source: World Gold Council, Frost & Sullivan
In 2023, global mined gold production volume amounted to 117.2 million oz. The major
mined gold production countries include China, Russia, Australia, Canada, and the U.S. In
2023, China was the largest mined gold producer with 12.1 million oz production, accounting
for approximately 10.3% of global gold supply. Assuming there is ongoing global economic
recovery, global gold supply is expected to grow at a CAGR of 1.1% from 2024 to 2028, driven
by robust gold demand, rising in gold price, and advancements in mining and exploration
technologies.
The major areas in China which produced gold include Shandong, Henan, Inner
Mongolia, Gansu, Y unnan and Xinjiang. In 2023, Shandong ranked the first with 1,417.0 koz
of gold produced from gold mines. Regarding China’s gold supply, while production dropped
by approximately 10% in 2021, by 2022 production had recovered as companies resumed
operations post safety inspections in Shandong from the beginning of February 2021 to the end
of March 2021 which resulted in the temporary shutdown of multiple gold mines. It is
anticipated that China’s mined gold output will increase by 12.3% from 2024 to 2028, which
will be supported by advancements in technology and equipment and a steady rise in demand
from various sectors.
Gold Resources and Reserves
From 2019 to 2023, global and Chinese gold Reserves increased with the discovery of
newly identified gold mines each year. During the same period, the gold Reserves in Laos and
Ghana remained stable. According to the disclosure of the United States Geological Survey
(USGS), Ghana’s gold reserves have not changed from 2019 to 2023. According to the Ministry
of Industry and Commerce of the Lao PDR, Laos had a gold reserve of 500 tons in 2019. Since
then, there have been no new changes in the public disclosure of Laos’ gold reserves data.
INDUSTRY OVERVIEW
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--- page 186 ---
Gold Reserves*, Global, Ghana, Laos and China, 2019-2023
0
2019
1,607.7
64.3
32.2
16.1
64.3
32.2
16.1
64.3
32.2
16.1
61.1
32.2
16.1
32.2
16.1
96.6
1,704.2
1,736.3
1,672.0
1,897.1
2020 2021 2022 2023
50
1,650
1,700
1,750
1,800
1,850
1,900
Million ounce
Global
China
Ghana
Laos
Global China Ghana Laos
CAGR 19-23 4.2% 10.7% 0.0% 0.0%
* “Reserve” refers to part of the reserve base that could be economically extracted or produced at the time of
determination and include only recoverable materials.
Source: The U.S. Geological Survey, Frost & Sullivan
As of the end of 2023, there was approximately a total of 1,897.1 million oz of gold
Reserves identified across the globe. The following two charts set forth the global gold
Reserves by country as of 2023 year end and the gold Resources by provinces in China as of
the same date, respectively.
Gold Reserves* by Countries, Global, 2023
Australia
Russia
South Africa
China
United States
Indonesia
Brazil
Canada
Peru
Uzbekistan
Mexico
Ghana
Kazakhstan
Laos
Others
32.2
32.2
16.1
385.7
Location of our
Company’s mines
45.0
57.9
74.0
74.0
77.2
83.6
96.5
96.6
160.8
356.9
385.9
Total = 1,897.1 million ounces
0 50 100 150 200 250 300 350 400 450
INDUSTRY OVERVIEW
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--- page 187 ---
* “Reserve” refers to part of the reserve base that could be economically extracted or produced at the time of
determination and include only recoverable materials. Due to data availability, Reserves are usually used to
demonstrate the gold resources of different countries.
Source: The U.S. Geological Survey, Frost & Sullivan
In terms of identified gold Resources as of 2023-year end in China, Shandong was the
largest with approximately 140 million oz of identified gold Resources as of 2023 year end,
followed by Gansu and Tibet. Inner Mongolia ranked fourth with approximately 29.9 million
oz of identified gold Resources as of 2023 year end.
Identified Gold Resources* by Provinces, China, 2023
0
Shandong
Gansu
Tibet
Inner Mongolia
Henan
Yunnan
Xinjiang
Anhui
Shaanxi
Sichuan
Northeast Region
Others 96.6
Location of our
Company’s mines
31.4
17.1
18.4
21.2
23.0
27.1
27.1
29.9
37.4
38.8
140.0
25 50 75
Total = 508.0 million ounce
100 125 150
* China identified gold Resources in or prior 2019 refers to identified gold Resources as defined in GB/T
17766-1999, after 2019 refers to gold Resources as defined in GB/T 17766-2020. Northeast region contains
Heilongjiang, Jilin and Liaoning.
Source: China Gold Association, Frost & Sullivan
INDUSTRY OVERVIEW
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--- page 188 ---
PRC Gold Mining Market
We ranked fifth in terms of gold production and gold resources in China as of December
31, 2023. Moreover, we have a more diversified mineral product profile and larger overseas
business coverage than most of the major players in the market.
Top 5 Gold Producers (by Resources), China, 2023
Shandong Gold
Mining Co., Ltd.
Zhaojin Mining Industry
Company Limited
Zhongjin Gold
Co., Ltd.
Chifeng Jilong Gold
Mining Co., Ltd.
Zijin Mining Group
Company Limited
Million ounces
96.4
46.0
39.4
28.7
13.6
0
20
40
60
80
100
Source: Annual Report, China Gold Association, Frost & Sullivan
Cost of Supply
The following chart sets forth the global average AISC (quarterly) from 2021Q1 to
2024Q1.
Average AISC (Quarterly), Global, 2021Q1-2024Q1
0
500
1,000
1,050.0
21Q1 21Q2 21Q3 21Q4 22Q1 22Q2 22Q3 22Q4 23Q1 23Q2 23Q3 23Q4 24Q1
1,069.5 1,119.9 1,096.2
1,229.9 1,259.8 1,314.5 1,278.0 1,339.4 1,355.8 1,373.8 1,409.5 1,496.2
1,794.2 1,816.5 1,789.5 1,795.5 1,877.2 1,870.6
1,728.9 1,728.4
1,889.9 1,975.9 1,928.5 1,974.3
2,069.8
1,500
2,000
2,500
AISC Gold Spot Price
CAGR
21Q1-24Q1 3.0% 1.2%
USD/oz
AISC Gold Spot Price
Source: Frost & Sullivan
INDUSTRY OVERVIEW
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--- page 189 ---
The following chart sets forth the global cost curve in 2023:
Cost Curve*, Global, 2023
Cumulative Gold Production (thousand oz)
AISC
(USD/oz)
3,000
0
1,000
2,000
4,000
5,000
52,600
1st quartile 2nd quartile 3 rd quartile 4 th quartile
39,45026,30013,150
Our Company
(Domestic)
Our Company
(Overseas)
* Excluding the extreme mining situation, i.e. the Matilda mine. Unforeseen events, such as production accidents
or natural disasters, can cause significant output reductions and abnormal increases in AISC for certain
sampled gold mines. Excluding these outliers allows for a more accurate representation of the cost curve.
Source: Frost & Sullivan
Gold Price
Global Gold Pricing Trend
In 2019 and 2020, the U.S. Federal Reserve and other central banks of major economies
introduced financial and monetary stimuli to inject liquidity into the market, causing the U.S.
dollar to depreciate, and major asset classes experienced bearish trends. The global market
sought gold for value preservation and risk hedging, which raised the gold price in 2020. In
2021, as the economy started to recover and interest in gold investments decreased, the growth
of the global gold spot price slowed down. In 2022, the Russia-Ukraine conflict led to a
significant increase in the global gold price. Concurrently, the U.S. Federal Reserve began to
raise interest rates to address the high inflation issue in the U.S., which led to an increase in
gold investment in coins and bars globally. Additionally, central banks increased their gold
reserves as a precaution against a potential economic recession. In 2023, global gold spot price
continued to increase from USD1,801.3 per ounces in 2022 to USD1,942.1 per ounces in 2023.
Worries of economic downturn under the context of high inflation and high fuel cost is
to last in the forecast time period, plus the existing geopolitical uncertainties (e.g. Russia-
Ukraine tensions). With the continuous decline in inflation and the employment pressure
brought about by the economic slowdown, the U.S. Federal Reserve has initiated a cycle of
interest rate cuts. Although lower interest rates are beneficial for the market, concerns about
economic slowdown still outweigh the advantages brought by the rate cuts. Therefore, gold is
INDUSTRY OVERVIEW
– 178 –


--- page 190 ---
needed for investment portfolio diversification to hedge risks and value preservation. Looking
ahead, considering the strong demand for gold, global gold spot price is expected to go up
steadily during 2024 to 2028 at CAGR of 7.1%, from USD2,357.1 per ounces in 2024 to
USD3,097.7 per ounces in 2028.
No single industry player or factor can significantly impact gold prices on its own.
Generally, gold mining companies adjust their production plans in response to gold price
forecasts. They tend to ramp up production if prices are expected to rise. However, production
increases are constrained by various challenges, such as increasing mining cost, license,
climate change, etc.
Latest development in gold ETFs and their demand
Investments include purchase of gold bars and coins as well as exchange traded funds
(“ETF”). From 2018 to 2020, there was a growing trend towards gold investments, which was
attributed to the increase in the gold price and consumers’ purchase of bars and coins for value
preservation. In 2021, investments in gold decreased by more than 40% compared with the
2020 level. This was mainly caused by a decrease in gold investments through ETFs. In 2022,
investments in gold increased, especially for investments in gold coins and bars, which was
largely due to geopolitical concerns and hedging against inflation. In 2023, investments in gold
decreased by 15% compared with the 2022 level. This was mainly caused by the rising gold
price. As of the second quarter 2024, global gold ETFs have shown an outflow trend, with total
global gold ETF holdings decreasing by 7.2 tonnes to 3,105.5 tonnes.
Global Average Gold Spot Price
The following chart sets forth the annual average gold spot price of the London Bullion
Market and the Shanghai Gold Exchange for the period indicated.
Annual Average Gold Spot Price*, Global & China, 2019-2028E
2019 2020 2021 2022 2023 2024 2025E 2026E 2027E 2028E
USD/oz
1,765.4 1,798.9 1,801.3
2,931.0 2,995.7 3,066.3 3,097.7
1,393.5
1,942.1
2,357.1
387.1 374.3 392.1
556.4
612.9 623.7 636.4 641.1
312.4
449.6
0
1,000
2,000
2,500
3,000
3,500
500
1,500
2019 2020 2021 2022 2023 2024 2025E 2026E 2027E 2028E
RMB/g
0
200
400
500
600
700
100
300
* Global gold price is set as quarterly averaged gold spot price of the London Bullion Market. The price is set
in USD per fine troy oz, which is a troy oz (equals approximately 31.1 grams) of 99.5% pure gold. “China gold
spot price” refers to the closing price of Au99.95 traded on the Shanghai Gold Exchange.
Source: London Bullion Market Association, Shanghai Gold Exchange, Frost & Sullivan
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The gold price is predominantly impacted by factors such as the real interest rate, the
value of U.S. dollar, global geographical uncertainties, and inflation expectations. Typically,
when there exist instabilities in the political or economic environment or turbulence in the
stock market, gold is treated as a risk-hedging tool, and its price will typically exhibit an
upward trend. Moreover, monetary policies by central banks (e.g. fluctuations in the currency
exchange rate) and macroeconomic factors (e.g. interest rate and inflation expectations) are
also important factor that influence the gold price. Upon a long-term observation of gold price
trends, it can be observed that there is an overall upward trend of volatility. Even during
periods of cyclical adjustments, the bottom of the price is gradually rising, demonstrating the
stability and growth potential of gold as a store of value.
From 2019 to 2023, the gold spot price in China grew at a CAGR of 9.5% from
RMB312.4 per gram in 2019 to RMB449.6 per gram in 2023. It is expected to climb steadily
at a CAGR of 3.6% from 2024 to 2028, from RMB556.4 per gram in 2024 to RMB641.1 per
gram in 2028. China’s gold spot price in 2023 increased by approximately 14.7% as compared
with 2022, which was greater than the 7.8% increase in the global gold spot price across the
same periods. This was mainly due to the depreciation of Renminbi against U.S. dollar.
Raw Materials
Industrial explosives and diesel are key raw materials in gold mining, and their prices can
significantly represent the major raw material costs in the industry. Industrial explosives are
mainly used in gold mining to break rocks and ores. Diesel, on the other hand, is the energy
source for many mining equipment, such as excavators, trucks, drilling rigs, and generators.
Overall, the prices of major raw materials for gold mining companies have experienced a slight
upward trend in recent years. For instance, the average price of industrial explosives in China
rose from RMB5.7 thousand per ton in 2019 to RMB6.4 thousand per ton in 2023, reflecting
a CAGR of 3.1%. Similarly, the average price of diesel in China increased from RMB5.7
thousand per ton in 2019 to RMB6.4 thousand per ton in 2023, with a CAGR of 4.3%. The
slight upward trend in the price of industrial explosives in the past has mainly been due to the
increase in upstream raw material costs. The price of diesel in China is mainly regulated by the
National Development and Reform Commission, based on changes in international oil prices.
Average Price of Industrial Explosives,
China, 2019-2023
Average Price of Diesel,
China, 2019-2023
2019 2020 2021 2022 2023
RMB Thousand/ton
5.7
6.1
6.9
5.7
6.4
5.5
6.8
8.5
6.7
8.0
0
3
5
6
7
8
2
4
RMB Thousand/ton
2
4
6
8
10
1
2019 2020 2021 2022 2023
Source: National Development and Reform Commission, Frost & Sullivan
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Competitive Landscape
Overview
The gold industry has become more concentrated due to mergers and resource integration
of gold companies. Large gold companies with advantages, such as efficient operations, global
presence, financial strength and other advantages, are leading the industry. At the same time,
regulatory controls, including safety and environmental protection requirements, have further
tightened. Less competitive gold production companies with aging facilities and insufficient
resources have been forced to shut down or undergo significant changes. Furthermore, the total
production cost of gold mining has increased due to several factors, and smaller gold
companies have gradually exited the market.
Global Gold Mining Market
The top 10 global gold producers contributed approximately 25.6% of the global gold
mining production in 2023. Among them are various big names such as Newmont Mining,
Barrick Gold, Agnico Eagle and PJSC Polyus, etc. Most of the top gold producers are
headquartered in U.S., Australia, Canada, South Africa, and Russia, with their footprints
spanning across several continents. The global gold mining industry is relatively fragmented;
although, a consolidation trend has emerged in the past years. According to Frost & Sullivan,
our Company is estimated to be ranked 20th to 30th among global gold producers in terms of
gold production volume in 2023.
Gold Production of Top 10 Gold Producers, Global, 2023
Rank Company Gold Production
(Million oz) Market share
1 Newmont Mining 5.5 4.7%
2 Barrick Gold 4.1 3.4%
3 Agnico Eagle 3.4 2.9%
4 PJSC Polyus 2.9 2.5%
5 Navoi MMC 2.9 2.5%
6 Gold Fields 2.6 2.2%
7 AngloGold Ashanti 2.3 2.0%
8 Zijin Mining Group Co., Ltd. 2.2 1.8%
9 Kinross Gold 2.2 1.8%
10 Freeport-McMoRan 2.0 1.7%
Our Company 0.5 0.4%
PRC Gold Mining Market
We ranked fifth in China in terms of gold production in 2023, and we have achieved the
fastest growth rate in gold production volume from 2021 to 2023 among the top 5 gold
producers in China. Moreover, we have a more diversified mineral product profile and larger
overseas business coverage than most of the major players in the market.
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Gold Production of Top 5 Gold Producers in China, 2023
Rank Company Gold Production
(Million oz) Market Share
1 Zijin Mining Group Co. Ltd. 2.2 18.9%
2 Shandong Gold Group Co., Ltd. 1.6 13.6%
3 China National Gold Group Co., Ltd. 0.9 8.1%
4 Shandong Zhaojin Group Co., ltd. 0.6 5.2%
5 Our Company 0.5 4.0%
In comparison with other leading players in the gold mining market in China, we have
comparative advantages in multiple aspects. For example, we offer a more extensive range of
mineral products and larger overseas business coverage than most of the major players in the
market. In terms of the gold production growth in the past three years, we were the highest
among major gold producers in China, representing a gold production growth of 33.1% from
2019 to 2023. Regarding the proportion of overseas business, we maintain the status as the
leading player in the market.
Entry Barriers
The principal entry barriers to the gold industry include the following:
 Policy Barrier. Globally, majority of governments implement an admittance system
for the exploitation of gold resources. The application for gold mining and smelting
shall comply with the requirements of the national gold industry planning, industrial
policies and the state regulations on the approval of investment projects,
environmental protection and land administration, etc. Gold mining companies shall
be qualified for the exploitation of gold resources in order to obtain the mining
license issued by the governments of where the gold mines are located . In addition,
gold mining enterprises can only conduct mining within the area stipulated by the
state, and comply with increasingly strict safety production and environmental
protection regulations. It is difficult for new market entrants to obtain relevant
qualifications in a short period of time.
 Capital Barrier. The gold industry is a capital-intensive industry, which requires a
significant investment in infrastructure and production equipment in the early stage.
The costs of exploration, mining, and refining are extremely high, while significant
initial investment is required for the purchase of equipment. Notably, gold
manufacturing needs a large amount of initial capital for the procurement of gold
ore, the construction of manufacturing facilities as well as the purchase or
installation of machines in order to produce gold products.
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 Technology Barrier. As the grade of gold ore decreases and mining depths increase,
the difficulty and complexity of gold mining procedures rise accordingly, creating
a high technical barrier for new entrants. Additionally, it takes a significant amount
of time and effort for gold mining companies to acquire qualified professionals
capable of applying new mining technologies. Furthermore, only companies with
advanced technology and sufficient experience can meet the increasingly strict
government requirements for safe production and environmental protection, further
increasing the challenges for new entrants.
 Human Capital Barrier. As the mining industry shifting towards intelligent mining
and green mining as global popular trends, the mining industry will become more
technology-intensive in the future. The industry will become more human-capital-
intensive as industry demand for talent with experiences in IT, ESG and mining is
booming. Professionals with such rich experiences are extremely popular in
recruiting market, and new market entrants often struggle to find experienced
professionals.
Market Drivers
 Increasing Gold Reserve by Central Banks. Internationalization of Renminbi is the
result of national economic development. Since being included in the IMF’s Special
Drawing Right (SDR) in 2016, Renminbi has become a big part of international
reserve currency. As an important means of reserve and settlement, gold reserves are
used to hedge the risk of international financial markets. There is a trend by China
to increase its central bank gold reserves to meet the demand following Renminbi’s
internationalization.
 Sustained Consumer Demand. The ongoing and long-term consumer demand for
gold jewellery and gold as an investment asset plays an essential role in the global
gold market. As a traditional pillar of the gold market, the demand for gold jewellery
remains relatively stable. Moreover, facing economic fluctuations or uncertainties,
individual investors are increasing their investment in gold.
 Rising Gold Price. The gold price drives both the supply and demand of gold. On
the supply side, the increasing gold price has expanded the profit margins for gold
mining operations, encouraging companies to increase gold mining. On the demand
side, some individual investors are attracted by the rising gold prices, expecting to
purchase gold before prices peak, with the aim of realizing profits. In recent years,
under the combined effect of the increasing downward pressure on major economies
and pessimism in the global financial, the safe-haven function of gold has been fully
highlighted, and the price of gold has begun to trend upward.
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 Increasing Demand for Safe Haven Assets. Global socio-economic fluctuations and
uncertainties, coupled with geopolitical risks such as the Russia-Ukraine conflict
and conflicts in Israel, have collectively fueled market demand for safe-haven
assets. Against this backdrop, gold, as a traditional choice for risk aversion, is likely
to attract some investors, and countries may increase their gold reserves to protect
their economies from exchange rate fluctuations, thereby driving the growth of the
global gold market. For Laos and Ghana, gold exports play a crucial role in their
economic structures, serving as a significant source of foreign exchange earnings.
Given the promising growth of the global gold market, the gold sectors in Laos and
Ghana are expected to provide strong impetus for economic development.
Development Trend
The following are some of the trends of the global and PRC gold mining industry:
 Green Mining. Governments around the world have successively issued a series of
policies calling for the development of environmentally friendly gold mining
technologies. Therefore, gold mining companies are bound to renew their
technologies to promote environmental-friendly mining.
 Deep Mining. With the consumption of shallow gold resources, global gold mining
industry gradually turns to deep mining. With the gradual depletion of surface
resources, many mining companies have begun to turn to deep mining. Deep gold
mines may range from several hundred meters to several thousand meters deep, and
some specific gold mines may even reach 4,000 meters or deeper. In China, the
NDRC issued Guide Catalogue for Industrial Restructuring (2019 edition)
encourages the development of deep gold mining. Enterprises with gold mining
capabilities in challenging terrain, such as Our Company, are more competitive in
the gold industry.
 Intelligent Mining. With the decrease in the cost of digital technologies and the
successful trial and testing of digital solutions, it is becoming increasingly feasible
to apply intelligent mining. Intelligent mining will enable the management of
resources such as energy, labor, equipment, and infrastructure as variable costs. It
integrates with smart automation based on equipment capacity, availability, and
utilisation. Optimizing these variable resources across the value chain will improve
sustainability, reduce utility consumption, and significantly enhance mining
efficiency.
 Enterprise Mergers and Acquisitions. Gold mining players are facing increasingly
higher production cost and lower profit margin due to the large proportion of
low-grade ore and refractory gold resources globally. Gold mining companies may
turn to seek overseas gold resources, capital, and technology. Global mergers and
large-scale acquisitions have become a major trend in the development of the gold
industry.
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Key Success Factors for Gold Mining Companies
 Increasing and Diversified Gold Mine Resources. It is crucial for gold mining
companies maintaining competitiveness to increase and diversify their gold mine
resources. The scale and quality of gold mine resources are foundations for gold
mining companies to establish scale economy, maintain long-term growth and attract
investments. The geographical diversity of gold mine resources will significantly
increase the risk resistance capacity of gold mining companies.
 Technological Innovation. Chinese gold producers should continue to develop new
technologies and strive to achieve low-cost operations and effective resource
utilisation through technological innovation and application. Advanced production
management systems and technologies help enterprises achieve highly mechanized,
digital, and intelligent control and optimization in the gold production process.
 ESG Governance. The gold industry should continue to adhere to the concept of
green development. Chinese gold producers will continue to attach importance to the
environment and safety, humanistic care, and social responsibility as one of the
important goals of enterprise development.
 Supply Chain Management. In the process of gold mining and processing, gold
mining companies need to procure various types of equipment and raw materials,
such as rock drilling machines, drilling jumbos, scrapers, explosives, diesel, sodium
cyanide, etc. Additionally, gold mining companies may employ different third-party
subcontractors for tasks like refining and logistics. A well-established supply chain
management capability is crucial for gold mining companies to maintain efficient
production and expand their asset portfolios globally.
 Gold Price Fluctuations. Gold price is the critical factor affecting a company’s
revenue and profits. Gold producers must closely monitor gold price trends, flexibly
adjust production plans and sales strategies to cope with market opportunities and
challenges.
OVERVIEW OF THE COPPER INDUSTRY
Introduction of Copper
Copper is one of the most used and reused of all metals. The demand for copper is due
to its good strength, excellent electrical and thermal conductivity, outstanding resistance to
corrosion, and ease of fabrication. Copper is often found in areas along the western continental
edges of North and South America as well as southwestern part of the U.S. Currently, copper
is used in building construction, power generation and transmission, electronic product
manufacturing, and production of industrial machinery and transportation vehicles. It is also
used in alloys such as brass and bronze, alloy castings, and electroplated protective coating in
undercoats of nickel, chromium, and zinc. In 2023, our Company’s production of electrolytic
copper and copper concentrate powder was approximately 7,900 tons, which is significantly
lower than the annual production of copper products from leading copper smelting companies.
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Copper Reserves
The global copper Reserves reached 1,000.6 million tonnes as of December 31, 2023, and
the top three countries in terms of copper Reserves were Chile, Peru, and Australia, with their
copper Reserves estimated at 190.0 million tonnes, 120.0 million tonnes, 100.0 million tonnes
as of December 31, 2023, respectively. In addition, the copper Reserves in Laos were estimated
at 1.7 million tonnes as of December 31, 2023. China’s copper Reserves, which were largely
concentrated in areas such as Tibet, Jiangxi and Y unnan, were estimated at 41.0 million tonnes
and accounted for 4.1% of the global copper Reserves as of December 31, 2023.
Copper Demand
The following table sets forth the volume of global copper demand by end uses for the
periods indicated.
Copper Demand, Global, 2019-2028E
0
10
20
30
40
24.3
2019 2020 2021 2022 2023 2024E 2025E 2026E 2027E 2028E
Million tonnes
23.5
25.5 26.5 27.8 29.0 30.3 31.8 33.4 35.1
CAGR 19-23 CAGR 24E-28E
3.5% 4.9%Copper Demand
Source: Frost & Sullivan
From 2019 to 2023, global copper demand increased at a CAGR of 3.5% from 24.3
million tonnes to 27.8 million tonnes. The significant increases in downstream industries, such
as mechanical equipment, construction and power supply, have strongly supported the steady
growth in global copper demand. In the future, the wide application of electric vehicles is
expected to stimulate copper demand from transportation in global market, which will further
drive the steady growth of global copper demand. Over the forecast periods, it is expected that
global copper demand will further rise at a CAGR of 4.9% from 29.0 million tonnes in 2024
to 35.1 million tonnes in 2028.
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Copper Supply
The following chart sets forth the volume of global copper supply for the periods
indicated:
Copper Supply, Global, 2019-2028E
20.4
2019 2020 2021 2022 2023 2024E 2025E 2026E 2027E 2028E
Million tonnes
20.6 21.0 21.9 21.6 21.9 22.2 22.4 22.6 22.7
4.1 3.9 4.1 4.2 4.6 4.9 5.3 5.7 6.1 6.524.4 24.4 25.1 26.1 26.1 26.8 27.5 28.1 28.7 29.3
CAGR 19-23 CAGR 24E-28E
2.9% 7.3%Recycled Copper
1.4% 0.9%Mine Production of Copper
1.7% 2.2%Total
0
5
10
15
20
25
30
Source: Frost & Sullivan
Copper mining increased slightly from 20.4 million tonnes in 2019 to 21.6 million tonnes
in 2023. Although mined copper outputs in multiple countries were affected by temporary
smelter shutdowns for maintenance and upgrades, the post-pandemic economic recovery and
the increased demand from downstream industries have stimulated steady growth of global
mine production of copper. In the future, the global long-term transition towards renewable
energy is expected to further boost copper demand. Over the forecast period from 2024 to 2028,
mine production of copper is expected to grow at a CAGR of 0.9%, with production reaching
22.7 million tonnes by 2028. In addition, with the continuous improvement of recycled copper
utilisation technology, recycled copper will play a more important role in global copper supply.
Over the forecast period during 2023 to 2028, global copper supply is expected to grow at a
CAGR of 2.2%, with production reaching 29.3 million tonnes by 2028. In particular, it is
estimated that global recycled copper production will increase at a CAGR of 7.3% and reach
6.5 million tonnes by 2028.
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Copper Price
Copper Price, Global, 2019-2028E
0.0
2019
5,999.7 6,180.6
9,317.5
8,797.0 8,523.0
10,329.9
11,807.0
11,157.7 10,800.6
11,373.0
2020
USD/tonne
2021 2022 2023 2024E 2025E 2026E 2027E 2028E
2,000.0
4,000.0
6,000.0
8,000.0
10,000.0
12,000.0
Source: Frost & Sullivan
Due to the economic recovery after the COVID-19 pandemic and insufficient supply of
copper mines, the global copper price rose sharply from USD5,999.7/tonne in 2019 to
USD8,523.0/tonne in 2023. In the future, it is estimated that the global copper price will
increase at a CAGR of 2.4% from 2024 to 2028 and reach USD11,373.0/tonne in 2028. The
high demand for copper is expected to increase significantly in 2024, and this positive trend
is expected to continue in 2025. To meet increasing copper demand, it is anticipated that the
copper supply will undergo expansion in the coming years, which may cause a slight
fluctuation after 2025. However, the expectation is that the increased scale of copper supply
will be less than that of demand, indicating that the copper price will continue to increase
during the subsequent years. Moreover, under the global accelerated transformation to the
green economy, global demand for copper is expected to rise steadily and lead to a long-term
structural gap between demand and supply, which will stimulate the recovery of the global
copper price.
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OVERVIEW OF INDUSTRIES RELATED TO OTHER MINERAL RESOURCES AND
RESOURCES AND RECYCLING BUSINESSES
Rare Earth
Rare earth metals are usually soft, ductile, and malleable, and are particularly reactive in
powder form at high temperatures. Rare earths are relatively abundant in the Earth’s crust, but
minable concentrations are less common than for most other mineral commodities. In 2023, the
global Reserves of rare earths amounted to 3,537.0 billion oz, and was mainly distributed in
countries such as China, Vietnam, and Brazil. Among them, China has the highest proportion
of rare earths Reserves in the world, totaling 1,414.8 million oz. China adheres to a principle
of demand-driven allocation for rare earths and strictly controls the supply side of rare earths.
The ongoing deepening of supply-side reforms is aimed at accelerating the integration of rare
earth resources, promoting relative stability of product prices, and ensuring the safety and
continuity of the supply chain.
Other Non-ferrous Metals
 Zinc
Zinc has good corrosion resistance, ductility, and flowability. Zinc mainly exists in the
form of sulphides, and the main zinc containing mineral is sphalerite. In 2023, the global
Reserves of zinc amounted to 7,074.0 million oz, and was mainly distributed in countries such
as Australia, China, and Russia. Among them, Australia has the highest proportion of zinc
Reserves in the world, totaling 2,057.9 million oz.
 Lead
Lead has good ductility and corrosion resistance, making it easy to make excellent alloys
with other metals. Lead is mainly hidden in galena, a sulphide in the crust. In 2023, the global
Reserves of lead amounted to 3,054.7 million oz, and was mainly distributed in countries such
as Australia, China, and Russia. Among them, Australia has the highest proportion of lead
Reserves in the world, totaling 1,125.4 million oz.
 Molybdenum
Molybdenum occurs as the principal metal sulphide in large low-grade porphyry
molybdenum deposits and as an associated metal sulphide in low-grade porphyry copper
deposits. It is a silver-white metal, with a hard texture, high melting point, and relatively high
thermal conductivity. In 2023, the global Reserves of molybdenum amounted to 482,315.1
million oz, mainly distributed in countries such as China, the United States, and Peru. China
has the highest proportion of molybdenum Reserves in the world, totaling 186,495.2 million
oz.
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Resources Recycling Business
Our Company’s resource recycling business can be classified under urban mining. Urban
mining refers to the process of recycling various waste materials from end-of-life products and
converting them into new raw materials or usable components for further manufacturing
processes. This typically includes the recycling and utilisation of scrap vehicles, electronic
waste, waste power batteries, and more.
The development and promotion of urban mining allow for the efficient use of raw
materials and components derived from recycled waste, reducing the demand for the
production of new materials, which often leads to large volumes of greenhouse gas emissions.
Urban mining contributes to achieving carbon reduction goals and improving the ecological
environment in the long term. The market size of the urban mining industry in China exceeded
RMB80 billion in 2023.
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The following sets out a summary of the significant laws and regulations that affect our
businesses in the PRC, Laos and Ghana. Information contained below shall not be construed
as a comprehensive summary of all the laws and regulations applicable to us.
LA WS AND REGULATIONS RELATED TO OUR PRC OPERATIONS
Overview
Our business operations are subject to supervision and regulation by the PRC
government. This section sets out a summary of the major laws, regulations and policies which
we are subject to.
Principal Laws and Regulations Related to our Businesses in the PRC
Industry Classification
According to the Industry Classification of the National Economy (GB/T4754-2017)
jointly issued by the General Administration of Quality Supervision, Inspection and Quarantine
of the People’s Republic of China and the Standardization Administration of the People’s
Republic of China on June 30, 2017, the industry in which Chifeng Gold is engaged falls within
“B0911 copper mining and processing” and “B0921 gold mining and processing” under “B09
non-ferrous metal mining and processing industry”.
Laws and Regulations relating to Mineral Resources
According to the Mineral Resources Law of the People’s Republic of China ( ʕശɛ͏΍
جwhich was promulgated by the Standing Committee of the National People’s
Congress (the “SCNPC”) on March 19, 1986 and revised on August 27, 2009, all Mineral
Resources of the PRC are owned by the State. Anyone who wishes to explore or mine Mineral
Resources shall separately make an application according to law and shall register after
obtaining the right of exploration or mining upon approval, with the exception of the mining
enterprises that have, in accordance with the law, applied for and obtained the right of mining
and are conducting exploration within the designated mining area for the purpose of their own
production. In parallel with the exploitation of the main minerals, the minerals with industrial
value that occur in association or as by-products of the ordinary mineral production should be
subject to unified planning, comprehensive mining, and integrated utilization to prevent waste.
Administrative Measures for the Block Registration of Mineral Resource Prospecting ( ᘤ
جwas promulgated by the State Council on February 12, 1998
and latest revised on July 29, 2014. The State implements a unified registration management
system for Mineral Resources exploration. Exploration of Mineral Resources listed in the
Measures can only be launched with the approval and registration by the competent department
of geology and Mineral Resources with the exploration licenses issued.
REGULATORY OVERVIEW
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Rights and Obligations of Holders of Exploration Permits
When the prospecting right owner conducts an exploration during the validity period of
the exploration permit and finds a complex type of deposit that meets the State’s requirements
about the mineral that can be mined while being explored, it may apply for mining and go
through the mining registration formalities after approval by the registration management
authority.
Administrative Measures for the Registration of Mineral Resources Exploitation ( ᘤପ༟
جwas promulgated by the State Council on February 12, 1998 and latest
revised on July 29, 2014. Mining Mineral Resources listed in the Measures must be examined
and registered by the competent department of geology and Mineral Resources, and a mining
right license must be issued. The valid period of the exploitation licenses shall be determined
according to the construction scale of the mines. The maximum validity period of a mining
permit for a big-scale mine, medium-scale mine and small-scale mine shall be 30 years, 20
years and 10 years, respectively.
Interim Measures on the Supervision and Control of Mineral Resources ( ᘤପ༟๕္ຖ၍
جwas promulgated by the State Council on April 29, 1987 and came into effect on
the same day. To develop and utilize Mineral Resources, mining enterprises shall strengthen
mining management, select reasonable mining and processing methods, promote advanced
technologies and improve the utilisation of Mineral Resources.
Circular on the Issuance of Measures and Technical Guidelines for Determining the V alue
of Mineral Products Extracted by Illegal Mining and the V alue of Damage to Mineral
Resources Caused by Illegal Mining or Destructive Mining (ᄆ
ٝwas promulgated by
the Ministry of Natural Resources on December 9, 2024 and became effective on the same day.
The value of mineral products extracted by illegal mining and the value of Mineral Resources
destroyed by illegal or destructive mining shall be accounted for in accordance with specific
procedural norms and criminal acts of destruction of Mineral Resources shall be punished in
accordance with the law.
Measures for the Administration of Bidding, Auction and Listing Concerning Exploration
Rights and Mining Right (for Trial Implementation) (ج(༊
Б)) was promulgated by the former Ministry of Land and Resources on June 11, 2003 and
came into effect on August 1, 2003. The types of exploration rights and mining rights specified
in this Measures shall be granted by the government at or above the county level through
bidding, auction and listing. The Ministry of Land and Resources shall be responsible for the
supervision and administration of the bidding, auction and listing activities of exploration
rights and mining rights nationwide.
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According to the Administrative Measures for the Transfer of Exploration Rights and
Mining Rights (جwhich was promulgated by the State Council on
February 12, 1998 and latest revised on July 29, 2014, and the Provisions on Issues Concerning
the Examination and Approval of the Transfer of Exploration Rights and Mining Rights ( ઞᘤ
֛which was promulgated by the former State Land
Administration on December 14, 1998 and became effective on the same day, the transfer of
exploration rights and mining rights shall meet the conditions stipulated in these Measures. The
transferee of exploration rights or mining rights shall meet the conditions for applicants of
exploration rights or mining rights stipulated in the Administrative Measures for the Block
Registration of Mineral Resource Prospecting (جo r
Administrative Measures for the Registration of Mineral Resources Exploitation ( ᘤପ༟๕ක
جThe transfer of exploration rights and mining rights based on state-funded
exploration must be assessed. The cost of exploration right and mining right based on
state-funded exploration, shall be assessed by the agencies with mining right assessment
qualification. The assessment report shall be filed with the registration and administration
authority of exploration right and mining right. If a mining enterprise or individual transfers
part of the exploration area under an exploration right or part of the mining area under a mining
right, they must complete the alteration and division registration in respect of such exploration
right or mining right after obtaining the prior approval of the original registration authority, and
submit the application for transfer to the transfer approval authority.
Laws and Regulations relating to Production Safety
The PRC government has formulated a relatively comprehensive set of laws and
regulations on productions safety, including the Law on Work Safety of the PRC ( ʕശɛ͏΍
جcoming into effect on November 1, 2002 and revised on September 1, 2021),
the Interim Measures for the Supervision and Administration of ‘Three Simultaneities’ for
Safety Facilities of Construction Projects (݄“ࣛ”جcoming
into effect on February 1, 2011 and revised on May 1, 2015), the Law on Mine Safety of the
PRC (جcoming into effect on May 1, 1993 and revised on August
27, 2009) as well as the Implementation Rules for the Mine Safety Law of the People’s
Republic of China (ૢԷ) (coming into effect on October 30,
1996) promulgated by the State Council, covering Mineral Resources exploration, mining and
mine construction. The State Administration of Work Safety (τΌ͛ପ္ຖᐼ҅)i s
responsible for the overall supervision and management of the safety production nationwide,
while the departments in charge of safety production at the county level or above are
responsible for the overall supervision and management of the safety production within their
own jurisdictions.
Regulations on Work Safety Licenses ( τΌ͛ପ஢̙ᗇૢԷ) was promulgated by the
State Council on January 13, 2004 and latest revised on July 29, 2014. The State applies the
work safety licensing system to enterprises engaged in mining, construction, and the
production of dangerous chemicals, fireworks and crackers, and civil use explosive material.
No enterprise may engage in production activities without a work safety license.
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The PRC government implements a licensing system for production safety of mining
enterprises under the Regulations on Work Safety Permits (coming into effect on January 13,
2004 and revised on July 29, 2014). No mining enterprise may engage in production activities
without holding a valid production safety license. Enterprises which fail to fulfill the
production safety conditions may not carry out any production activity. Mining enterprises
which have obtained the production safety licenses shall not lower their production safety
standards, and shall be subject to the supervision and inspection by the licensing authorities
from time to time. If the licensing authorities are of the opinion that the mining enterprises do
not fulfill the production safety requirements, the production safety licenses may be withheld
or revoked.
Pursuant to the relevant requirements of the Law on Mine Safety of the PRC ( ʕശɛ͏
جthe Regulations on Reporting, Investigation and Treatment of Work Safety
Accidents (ஈଣૢԷ) (State Council Order No. 493), the Notice on
Regulating the Inspection for Acceptance upon Completion of Safety Facilities in Metal and
Non-metal Mine Construction Projects (ംʈ᜕ϗ
ٝissued by the State Administration of Work Safety (SAWS — [2016] No. 14), the
authorities in charge of mining enterprises under the people’s governments at or above the
county level shall exercise the following functions and responsibilities with respect to the
control of safety work in mines: (i) to inspect the implementation of laws and regulations on
safety in mines by mining enterprises; (ii) to examine and approve designs of safety facilities
in mine construction projects; (iii) to supervise the inspection for acceptance upon completion
of safety facilities in mine construction projects; (iv) to manage the training of managers of
mines and personnel in charge of safety work in mining enterprises; (v) to investigate and
handle work safety accidents at mines; and (vi) other controlling functions and responsibilities
provided for in laws and administrative rules and regulations.
Upon occurrence of accidents, mining enterprises shall immediately take measures to
rescue their workers and report any casualty to the relevant authority. In the event of a general
mine accident, the mining enterprise shall be responsible for investigating and handling the
case. In the event of a fatal accident, the government, the relevant authority, the labor union
and the mining enterprise shall conduct investigation and handle the case together. In addition,
mining enterprise shall pay compensation to any staff who was injured or died in the accident
in accordance with the national requirements. Such mining enterprise may only resume
production after the relevant danger at the scene has been eliminated.
Pursuant to Measures on the Implementation of Work Safety Permit for Non-Coal Mining
Enterprises (جcoming into effect on May 17, 2004
and revised on July 1, 2015), non-coal mining enterprises must obtain the production safety
permit and are prohibited from engaging in any production activities without obtaining the
permit.
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Pursuant to the Law of the PRC on the Prevention and Control of Occupational Diseases
(جطwhich was promulgated on October 27, 2001 and latest
amended on December 29, 2018, and Measures for the Declaration of Projects with
Occupational Hazards (جwhich was promulgated on April 27, 2012
and became effective on June 1, 2012, the facilities for the prevention and control of
occupational diseases of a construction project must be designed, constructed and put into
production and be used with the principal project at the same time. Besides, where there are
occupational disease hazard factors listed in the catalogue of occupational diseases in the work
site, production entities shall truthfully declare the hazardous project to the local health
administrative department in a timely manner and be subject to their supervision.
Laws and Regulations relating to Environmental Protection
The PRC laws and regulations relating to environmental protection mainly include:
Environmental Protection Law of the People’s Republic of China (ج)
revised on April 24, 2014 and implemented on January 1, 2015), Water Pollution Prevention
and Control Law of the People’s Republic of China (جط)
promulgated on June 27, 2017 and implemented on January 1, 2018), Atmospheric Pollution
Prevention and Control Law of the People’s Republic of China (ط
جrevised on October 26, 2018 and became effective on the same day), Law of the People’s
Republic of China on the Prevention and Control of Environment Pollution Caused by Solid
Wastes (جطrevised on April 29, 2020 and
implemented on September 1, 2020) and Implementation Regulation on the Environmental
Protection Tax Law of the People’s Republic of China (ૢ
Է) (promulgated on December 25, 2017 and implemented on January 1, 2018).
Pursuant to the aforesaid laws and regulations, enterprises that discharge and dispose of
toxic and dangerous substances such as waste water, waste gas and solid waste must comply
with the national and local standards of use, and shall declare to and register with the relevant
environmental protection administration authorities and pay pollution discharge fees as
required depending on the circumstances.
Law of the People’s Republic of China on Environmental Impact Assessment ( ʕശɛ͏
جwas promulgated by the SCNPC on October 28, 2002 and latest
revised on December 29, 2018. The State implements a classification-based management on
environmental impact assessment of construction projects according to the impact of the
construction projects on the environment. Construction entity shall prepare the environmental
impact report or environmental impact statement or fill out the environmental impact
registration form.
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Regulations on the Administration of Construction Project Environmental Protection (ܔ
ᚐ၍ଣૢԷ) was promulgated by the State Council on November 29, 1998 and
latest revised on July 16, 2017. State standards and local standards for the discharge of
pollutants must be complied with in building construction projects that generate pollution;
requirements for aggregate control of discharge of major pollutants must be met in areas under
aggregate control of discharge of major pollutants.
Law of the People’s Republic of China on the Prevention and Control of Atmospheric
Pollution (جطwas promulgated by the SCNPC on September 5,
1987 and latest revised on October 26, 2018. Enterprises, public institutions and other
producers and operators that build projects having impacts on the atmospheric environment
shall conduct environmental impact assessment and disclose the environmental impact
assessment documents to the public in accordance with the law; where pollutants are
discharged to the atmosphere, the discharging units must comply with the discharging standard
for atmospheric pollutants as well as the requirements on control of the total discharging
amount of key atmospheric pollutants.
The Law of the People’s Republic of China on the Prevention and Control of
Environmental Pollution caused by Solid Waste (جط)
was promulgated by the SCNPC on October 30, 1995, and was latest revised on April 29, 2020
and implemented on September 1, 2020. The construction of projects that produce, store, use,
and treat solid wastes shall be performed with environmental impact assessment conducted as
legally required and in compliance with the relevant provisions issued by the state concerning
the management of environmental protection in respect of construction projects. The facilities
for the prevention and control of environmental pollution by solid wastes required to be built
as ancillaries determined in the environmental impact assessment document of a construction
project shall be designed, built and put into operation at the same time as the main part of the
project. A mining enterprise shall adopt scientific mining methods and techniques for mineral
separation so as to reduce the production and storage of tailings, coal gangue, waste rock and
other mining solid wastes.
The Law of the People’s Republic of China on the Prevention and Control of Water
Pollution (جطwas promulgated by the SCNPC on May 11, 1984
and was latest revised on June 27, 2017. EIA must be carried out according to law for
newly-formed projects and reconstruction, or extensions projects that directly or indirectly
discharge pollutants to water bodies and other installations on water. The water pollution
prevention and control facilities shall meet the requirements of environmental impact
assessment documents approved or filed for the record. Enterprises, institutions and other
production and operation units directly or indirectly discharging industrial waste water and
medical sewage to waters and enterprises, institutions and other production and operation units
required to obtain pollutant discharging permit before discharging waste water and sewage
must obtain the pollutant discharging permit. When constructing underground facilities or
conducting underground exploitation or mining activities, preventive measures must be taken
to prevent groundwater pollution.
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The Law of the People’s Republic of China on the Prevention and Control of Noise
Pollution (جطwas promulgated by the SCNPC on December 24,
2021 and will take effect on June 5, 2022. New construction, reconstruction or expansion
projects that may cause noise pollution shall be subject to the environmental impact assessment
in accordance with the law.
The Regulation on Land Reclamation ( ɺήూኤૢԷ) was promulgated by the State
Council and became effective on March 5, 2011, and the Measures for the Implementation of
the Regulation on Land Reclamation (جwas promulgated on December
27, 2012 and amended on July 24, 2019. A production or construction entity or individual (the
“Land User ”) must undertake measures to restore a mining site to its original state within a
prescribed time frame if its mining activities result in damage to arable land, grassland or
forestry land. The land user is also required to formulate and implement a land rehabilitation
plan and to restore the land to a state appropriate for use by rehabilitation if its mining
activities result in damage to the land. The land rehabilitation plan shall be approved by the
relevant land resources authority. The land user is also required to set aside funds to be used
in land rehabilitation. The rehabilitated land is legally required to meet rehabilitation standards
and may only be subsequently used upon examination and approval by the land authorities. Any
failure to comply with this requirement or failure to restore the mining site to its original state
will result in the imposition of fines, rehabilitation fees, rejection of applications for land use
rights or rejection of application for new mining permits or renewal, alteration or cancellation
of mining permits by the local bureau of natural resources.
Laws, Regulations and Normative Documents relating to Foreign Investment and Foreign
Exchange
The Measures for the Administration of Overseas Investment of Enterprises ( Άุྤ̮ҳ
جwere promulgated by the NDRC on December 26, 2017 and came into effect on
March 1, 2018. To make outbound investment, any investor shall go through the formalities to
have a proposed overseas investment project approved or filed on the record, report relevant
information, and cooperate with supervision and inspection. An investor shall, in overseas
investment, neither violate the laws and regulations of China nor threaten or damage the
national interests and national security of China.
The Notice of the SAFE on Issues Concerning the Foreign Exchange Administration of
Overseas Listing (ٝwas promulgated
by the SAFE on December 26, 2014 and became effective on the same day. SAFE and its
branches with foreign exchange authorities supervise, manage and inspect, among other things,
the business registration, account opening and use, cross-border payments and capital exchange
involved in the overseas listing of domestic companies. A domestic company shall conduct
overseas listing registration with Foreign Exchange Bureaus at the place of its incorporation
with the relevant materials within 15 working days after the completion of the offering of its
overseas listing shares.
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The Circular of the State Administration of Foreign Exchange on Reforming and
Regulating Policies on the Control over Foreign Exchange Settlement of Capital Accounts ( ਷
ٝwas promulgated by the State
Administration of Foreign Exchange on June 9, 2016 and came into effect on the same day. The
foreign exchange receipts under capital accounts of domestic institutions are subject to
discretionary settlement policies. That the foreign exchange receipts under capital accounts
(including foreign exchange capital, foreign debts, and repatriated funds raised through
overseas listing) subject to discretionary settlement as expressly prescribed in the relevant
policies may be settled with banks according to the actual need of domestic institutions for
business operations has been clearly implemented in relevant policies. Domestic institutions
may, at their discretion, settle up to 100% of foreign exchange receipts under capital accounts
for the time being. The SAFE may adjust the above proportion in due time according to balance
of payments. While being eligible for discretionary settlement of foreign exchange receipts
under capital accounts, domestic institutions may also opt to use their foreign exchange
receipts according to the payment-based settlement system. A bank shall, in handling each
transaction of foreign exchange settlement for a domestic institution according to the principle
of payment-based settlement, review the authenticity and compliance of the use of the fund
settled in the previous transaction (including discretionary settlement and payment-based
settlement) of such institution. The receipts under the capital account shall not be directly or
indirectly used for expenditures beyond the business scope of the enterprise or prohibited by
the laws and regulations. Except as otherwise provided by laws and regulations, they shall not
be directly or indirectly used for securities investment or other investment and wealth
management products except for principal-guaranteed products launched by banks; they shall
not be used for granting loans to non-affiliated companies (except explicitly approved within
business scope); and they shall not be used for building or purchasing real estate not for their
own use (except for real estate enterprises).
The Notice by the State Administration of Foreign Exchange to Facilitating Promoting
Cross-border Trade and Investment (ٙ
ٝwas promulgated by the State Administration of Foreign Exchange on October 23, 2019
and came into effect on the same day. Foreign-invested enterprises engaged in non-investment
business are permitted to settle foreign exchange capital in RMB and make domestic equity
investments with such RMB funds according to the law under the condition that the Negative
List is not violated and the relevant domestic investment projects are true and compliant.
The Circular on Optimizing Administration of Foreign Exchange to Support the
Development of Foreign-related Business (ٝwas
promulgated by the State Administration of Foreign Exchange on April 10, 2020 and became
effective on the same day. Eligible enterprises are allowed to make domestic payments by using
their capital, foreign credits and the income under capital accounts of overseas listing, with no
need to provide the evidentiary materials concerning authenticity of such capital for banks in
advance, provided that their capital use shall be authentic and in line with provisions, and
conform to the prevailing administrative regulations on the use of income under capital
accounts. The concerned bank shall conduct spot checking in accordance with the relevant
requirements.
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Laws, Regulations and Normative Documents relating to Labor Relations, Social Insurance
and Housing Provident Fund
The Labor Law of the People’s Republic of China (جwas
promulgated by the SCNPC on July 5, 1994 and was latest revised on December 29, 2018. An
employer shall establish a sound system of employment rules so as to ensure that its workers
enjoy the labor rights and perform the employment obligations. Employers must establish
comprehensive labor safety and health policies. They must strictly implement national labor
safety and health regulations and standards, provide labor safety and health education to
workers, prevent accidents at work, and reduce occupational hazards.
The Labor Contract Law of the People’s Republic of China (ج)
promulgated by the SCNPC on June 29, 2007 and latest revised on July 1, 2013) and the
Regulations on the Implementation of the Labor Contract Law of the People’s Republic of
China (ૢԷ) (promulgated by the State Council on September
18, 2008 and came into effect on the same day) stipulate the rights and obligations of the
parties to the labor contract, including the conclusion, performance, modification, rescission
and termination of the labor contract, etc. Employers must enter into written labor contracts
with workers and pay labor remuneration to workers timely and in full amount in accordance
with the provisions of the labor contract and national regulations. Employers may terminate
labor contracts with workers under certain circumstances and pay economic compensation to
workers according to law.
The Social Insurance Law of the People’s Republic of China (ᎈ
جwas promulgated by the SCNPC on October 28, 2010 and latest revised on December 29,
2018. Employers shall register for social insurance at a local social insurance agency and pay
social insurance premiums for workers, including basic endowment insurance premiums, basic
medical insurance premiums, work-related injury insurance premiums, unemployment
insurance premiums and maternity insurance premiums, etc.
The Regulations on the Administration of Housing Provident Fund (၍ଣૢԷ)
was promulgated by the State Council on April 3, 1999 and was latest revised on March 24,
2019. The employer shall undertake housing provident fund payment and deposit registrations
at the housing provident fund administration center, and open housing provident fund accounts
on behalf of its workers. The employer shall pay and deposit housing provident fund for its
employees with a rate of not less than 5% of the average monthly salary of the employees
concerned in the previous year.
Laws, Regulations and Normative Documents relating to Enterprise Tax
The Enterprise Income Tax Law of the People’s Republic of China ( ʕശɛ͏΍ձ਷Άุ
جpromulgated by the SCNPC on March 16, 2007 and latest revised on December 29,
2018) and the Regulations on the Implementation of the Enterprise Income Tax Law of the
People’s Republic of China (ૢԷ) (promulgated by the
State Council on December 6, 2007 and latest revised on April 23, 2019), a resident enterprise
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is subject to enterprise income tax for the income derived from both inside and outside the
territory of the PRC. The enterprise income tax rate is 25%. Qualified small low-profit
enterprises are given the reduced enterprise income tax rate of 20%. High and new technology
enterprises which are supported by the State may enjoy a reduced EIT rate of 15%.
The Notice on Issues Concerning the Foreign Income Tax Credit of Enterprises (Ά
ٝwas promulgated by the Ministry of Finance and the
State Administration of Taxation of the People’s Republic of China on December 25, 2009 and
became effective on the same day. A resident enterprise may deduct from the taxable amount
of incomes of the current period its taxable incomes derived outside China. Where the income
received by a resident enterprise from a country (region) that has entered into a tax treaty (or
arrangement) with the Chinese government has enjoyed tax exemption or reduction treatment
in accordance with the tax laws of the country (region), and the amount of tax exempted or
reduced should be deemed that the tax paid is credited against the tax payable in China in
accordance with the provisions of the tax treaty, the amount of tax exempted or reduced may
be used as the amount of overseas income tax actually paid by the enterprise for tax credit
purpose.
LA WS AND REGULATIONS IN RELATION TO OUR OPERATIONS IN LAOS
Legislation on Foreign Investments
The Investment Promotion Law (amended) No. 62/NA dated June 28, 2024 and published
in the Lao Official Gazette on December 16, 2024 (the “ Investment Promotion Law ”) is the
main legislation on investment in Laos. It defines the forms of investments and procedure for
investors to engage in general investment and concession businesses in Laos. This law provides
for the incentives, support, and process for investments in the country.
Under the Investment Promotion Law, business activities are classified as:
1. general investments not in the controlled business list;
2. general investments under the controlled business list, defined as businesses that
have an impact to the stability of national security, public order, and social and
natural environment; or
3. concession investments, which are investments for which an investor is authorized
by the Laotian Government in accordance with relevant laws and regulations to
develop and operate a business notably involving mining, concession of land,
development of special economic zones, exclusive economic zones, electric energy
development, airport services, road construction, and technology and
communication services. The term of investment in a concession investment
depends on the type, size, investment value, conditions, and feasibility study of the
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business in compliance with relevant laws, but shall not exceed fifty years. This
investment term may be extended with the approval of the Laotian Government or
the Laotian National Assembly or a provincial level assembly, as set out in the
relevant law.
The Investment Promotion Law requires an investor in concession business to submit an
application for investment license to the Ministry of Planning and Investment (“ MPI”). The
form of incorporation of the project company and the issuance of investment license will also
be considered by the MPI for a project in a concession business. The project owner may request
for the change of the form of investment. Such request will be subject to the consideration of
the MPI.
The Prime Minister’s Decree on the Approval of Controlled Business List and Concession
Activity in Lao PDR No. 03/PM dated 10 January 2019 (“ Decree No. 03 ”) enumerates the
controlled business list and concession list. Mining activities are included in the list as a
concession investment.
Under the Investment Promotion Law, a concession investment with total capital of more
than one hundred million to five hundred million U.S. dollars must have a registered capital
of not less than 5% of the total capital but not less than 20 million U.S. dollars. Registered
capital for concession investment shall be clearly expressed in assets, and throughout the
investment operation period the asset value shall not be less than the registered capital.
For a project company incorporated for a concession investment, the following minimum
paid up registered capital for concession investment must be made within 90 days from the
effective date of the concession agreement:
1. three percent (3%) of registered capital for projects with investment value of less
than fifty million U.S. dollars;
2. two percent (2%) of registered capital for projects with investment value from fifty
million to one hundred million U.S. dollars;
3. one and a half percent (1.5%) of registered capital for projects with investment value
from one hundred million to five hundred million U.S. dollars;
4. one percent (1%) of registered capital for projects with investment value of more
than five hundred million U.S. dollars.
The remaining amount shall be imported within two years from the date of the concession
agreement.
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Mineral Law
The Law on Minerals No. 31/NA dated November 3, 2017 (the “ Mineral Law ”) is the
main legislation governing mining development in Laos PDR. It provides for the principles,
rules, and regulations relating to managing, monitoring, and inspecting protection, trading,
mineral resource and minerals utilization, and the campaign of minerals to make it transparent,
efficient, and in order in detection, survey, excavation, and mineral processing, ensuring the
protection of heath, life, and safety of effected community, workers, and social and
environment protection; aiming to develop mineral area under economical plan, green and
sustainability, friendly to environment, create opportunities for economic growth, transform to
advanced industrialization gradually, contribute to national socio-economic development,
improve the livelihoods of Lao people.
The Ministry of Energy and Mines (“ MEM”) is the primary ministry responsible for the
management and monitoring of mineral business activities in Laos.
Mineral Activities
Activities concerning minerals are as follows:
a. Prospecting
Mineral prospecting refers to the study of data and information and field work to
determine geological conditions of the area and occurrences of mineralization, including
evaluation of mineral data aiming to identify feasible areas for exploration. Mineral
prospecting shall use advanced equipment to ensure efficient results. Individuals, entities,
and organizations are not allowed to operate mineral prospecting without legal approvals.
Prospecting license is issued to certify the right of investors to conduct prospecting
activities under an approved plan of the MEM. The application of the prospecting license
shall include following documents:
1. Investment license;
2. The report on results of the field data collection;
3. Location defined map of prospecting application;
4. Prospecting fund sources, minimum expenditure and prospecting plans; and
5. Academic and experience qualifications on minerals of officers.
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Prospecting license is valid up to two years extendable once but not more than one
year. Conditions on Prospecting license renewal are as follows:
1. Application shall be submitted ninety days before the expiry date of existing
license, otherwise, the application is not taken into consideration;
2. Financial obligations, obligations under local administrative authorities, and
other obligations under the law shall be implemented;
3. Submit reports on prospecting results and completing least sixty percent of
operations under the prospecting plan have been undertaken;
4. Propose plan to continue the prospecting;
5. Rehabilitate areas that have been excavated, drilled such as unnecessary
trenches and pits; and
6. Return at least twenty five percent of implemented area with non-economic
benefit minerals along with the reports on prospecting operations which
include prospecting information, relevant maps, sample inventory location,
and analyzed results.
A legal entity can operate one area of mineral prospection which covers maximum
of two hundred square kilometers. The applied area must be consistent with concession
area management system of the MEM.
b. Exploring
Mineral exploration refers to the study and evaluation of geological structures and
mineral sources, within the identified areas, that may include geological work,
geophysics, drilling, tunneling, trenching, pitting, sampling, analysis and assay and other
activities to learn about quantity and grade of any mineral reserves and to assess the
Technical-Economic Feasibility Studies for mining. Individuals, entities, and
organizations are not allowed to operate mineral exploration and mineral mining without
legal approvals.
After completion of prospecting and determining the feasibilities in exploration, the
investor shall apply to the MEM for an exploration license within ninety days prior to
expiry date of the prospecting license. The application shall include the following
documents:
1. Prospecting license and reports on prospection;
2. Fund sources for exploration, minimum expenditure and exploration plans,
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3. Socio-natural environment monitoring, inspecting, and management plans; and
4. Certificates of implementation of financial obligations and other obligations
under the law.
For areas that have been prospected and have geologic information, a legal entity
can directly apply for exploration.
The MEM considers the application within thirty workdays from the date of
receiving the prospecting reports and exploration application.
c. Technical-Economic Feasibility Studies
Technical-Economic Feasibility Studies review and evaluate the results from
mineral exploration in order to determine the best option for mineral development by
comparison in technics, technologies, marketing, investments, and the impacts on social
and natural environment.
After the acceptance of the summary report on mineral exploration, the investors
shall apply for certificate of Technical-Economic Feasibility Study implementation with
the MEM within fifteen workdays from the date of the application.
The term of a Technical-Economic Feasibility Study is up to two years extendable
once but not more than one year. After completion of the Technical-Economic Feasibility
Study, the licensed investors are able to implement mining under the negotiations and
contracts with the Laotian Government.
d. Mining
Mining is the extraction of minerals from the surface and underground by any
process of excavating, mining, digging, drilling, pumping, blasting, concentrating,
removing, and storing of minerals. Individuals, entities, and organizations are not allowed
to operate mining without legal approvals.
The investment in mineral mining shall have a mineral development concession
contract, mineral license approvals, and mine closure. After receiving the investment
certificate and signing the mineral development concession contract, the investor must
apply for mining license before the MEM. Under the current Mineral Law, the term of
mining license is not over twenty years extendable for ten years each time. The term of
the mining license includes inspecting period after mine closure.
In the previous Mining Law No. 04-97/NA dated April 12, 1997, the period of
mineral exploitation concession shall not exceed 30 years from the grant of the
concession, which may be extended twice, each time for no more than 10 years, as
approved by the Laotian Government on a case-to-case basis.
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Conditions for renewal of the mining license are as follows:
1. The application must be submitted twelve months before the expiry date of the
mining license;
2. Completed implementation of financial obligations and other obligations under
the laws;
3. Compliance with approved mining plans;
4. Plan for the continuation of the implementation of the mining project;
5. Negotiation on conditions of contract, if necessary.
e. Mineral processing
Mineral processing is the procedure of extraction of products with economic value
from raw minerals by crushing, grinding, separating, washing, refining, separation by
machine, grinding, polishing, leaching, flotation, filtering, electrical separation, smelting,
storing, and managing the waste products. The investor with mineral processing license
has the right to buy and sell, import and export mineral products.
f. Selling and buying minerals and mineral products
Selling and buying minerals and mineral products is an agreement between the
mining investors with individuals or legal entities, both domestic and foreign, to trade
mined minerals and process into products or commodities to supply to domestic and
international markets.
Individuals or legal entities with processing license has the right to buy, sell, and
import raw materials and semi-finished products to process into products or commodities
to supply to domestic and international markets.
g. Transporting minerals and mineral products
Transportation of minerals and mineral products refers to the moving of minerals
and mineral products from one location to another location domestically or to overseas or
from overseas into the domestic market, which must be done in accordance with the
Mineral Law and other relevant laws and regulations.
h. Mine closure
Mine closure refers to the process of restoration and rehabilitation of the land after
the completion of mining activities to hand over the concession area to the Laotian
Government.
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After completion of each mining area, the investor must proceed with mine closure
according to the mine closure procedures, timetables and evaluations of the expenditures
on area rehabilitation, mine closure, and the inspection after mine closure in accordance
with the approved mine closure and mining area rehabilitation plans.
The mining and mine closure plans must be continually implemented from the
beginning of mining operation and be reviewed and improved every three years. The
investors must periodically report the progress of mining area rehabilitation and mine
closure to the MEM.
Two years before end of mine closure, the MEM coordinates with the Ministry of
Natural Resources and Environment, relevant local administrative authorities and
communities in project areas to consult on the utilisation of land, infrastructure, building
and others.
After completion of mining area rehabilitation and mine closure, the investors must
return the concession area along with infrastructure and other relevant rights to the State.
If investors correctly complete all the conditions, the MEM will issue a certificate for
mine closure and return of the concession area.
Investors must guaranty the costs of environment rehabilitation and mine closure
including the inspecting activities after mine closure by providing a cash guaranty, bonds
or other financial instrument from a bank in Laos according to the value stated in the
approved mine closure and mining area rehabilitation plans, which is implemented by
providing an initial guaranty and annual installments depending on the term of the
project.
i. Transfer of the mining area
Transfer the mining area is the handing over of the rights on the licensed mining area
to the government.
Measures for Violation
Under the Mineral Law, individuals, legal entities or organizations violating the Mineral
Law shall be subject to measures from re-education, warning, disciplinary measures, fines,
civil measures, or penal prosecution, depending on the seriousness of the violation.
The Decree Fines and Other Measures against Violators of Laws and Regulations on
Minerals No. 373/GOV dated December 1, 2023 enumerates the fines and application of other
measures for administrative violations of the mineral legislation that shall be imposed to
individuals, legal entities, and organizations involved in mineral activities.
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Labor Matters
Labor Standards
The Labor Law (amended) No. 43/NA dated December 24, 2013 (the “ Labor Law ”) sets
the labor standards, labor relations, health, safety and welfare conditions for workers in Laos.
This Law sets the hours of work to six days per week and eight hours per day. The hours
of work is reduced to not exceeding six hours per day for hazardous occupations, such as work
in pits, underground tunnels, underwater or in high elevations, work directly with constantly
vibrating equipment, or direct exposure to dangerous materials or chemicals such as
explosives. Normal hours of work may also be reduced in cases where danger cannot be
prevented or controlled. The limited hours may apply to workers in the infrastructure markets,
depending on the work location and conditions. Overtime is also limited to forty-five hours per
month or three hours per day, and in no case be for more than four consecutive days, except
in case of emergency work such as to combat natural disasters or accident that would cause
great damage to the labor unit.
A company may hire needed foreign workers when granted authorization for importation
of foreign labor according to the allowed quota from the Ministry of Labor and Social Welfare
(“MLSW ”). Foreign workers need to secure a work permit, work visa, and stay permit. Foreign
workers are allowed to remain for a period of twelve months, which can be extended for the
same period for up to five years. Management level workers and specialists may be considered
specifically for extensions.
The Labor Law provides for instances where employment contracts may be cancelled by
mutual agreement or unilaterally by either the employer or employee (without fault) by giving
notice for at least thirty (30) days in advance for unskilled or manual labor and forty-five (45)
days for skilled or academic employees. The same thirty or forty-five day notice requirements
apply in case of a sale or transfer of business, or a change in employer. Contracts may also be
cancelled in case of fault of an employee or employer, and in the latter case, the employee may
be reinstated or be paid compensation.
The internal regulations of a labor unit, or Rules of Work, are considered as legislation
that the employer must devise to implement the Labor Law. The Rules of Work is registered
for approval of the Labor Administration Agency and must be written in the Lao language and
in case where the labor unit includes foreign labor, translated into the language of the foreign
employee.
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Social Security
The Law on Social Security No. 54/NA dated June 27, 2018 (the “ Social Security Law ”)
sets out the benefits provided under the National Social Security Fund for health care,
maternity, employment injury, occupational disease, invalidity, sickness, pension, death,
survivor’s benefit and unemployment. Under this Law, employers are required to contribute 6%
and employees contribute 5.5% of employee’s monthly insurable earnings to the social security
fund for the payment of social security benefits. Employers are required to register with the
Social Security Organization in order to pay the contributions required under this Law.
Labor Health and Safety
The Decree on Labor Safety and Health No. 22/GOV dated February 5, 2019 defines the
regulations and measures related to labor safety and health to prevent labor accidents and
occupational diseases. The Decree provides the requirement for appropriate personal protective
equipment, installation of danger signs and warnings, and safety culture. Employers are
required to report labor accidents and occupational diseases to the Labor Management
Department. The employer and Social Security Organization bears the cost of treatment,
allowance and compensation of workers who suffered from labor accidents and occupational
disease.
Larger labor units with 101 to 1,000 employees are required to have a part-time or
full-time specialist such as doctor, nurse, sanitation officer and engineer under the Decree on
Labor Safety and Health. Under the Labor Law, for labor units in remote areas with 50 or more
employees, a medical practitioner must be assigned to the labor unit.
Employees responsible for labor health and safety must have knowledge and undergone
training or have a degree or certification from an institute or organization on labor health and
safety that is recognized by the Labor Administration Agency of the MLSW.
Environment
Laws and Policies on Environment
The Environmental Protection Law (amended) No. 53/NA dated June 28, 2024 (the
“Environmental Law ”) is the main legislation that provides the regulations and measures
related to environmental management, aiming to provide balance between social and natural
environment, efficient and effective use of natural resources, improve the quality of life and
health of people, animals, and plants, reduce global warming, and contribute to the national
socio-economic development according to a green a sustainable direction.
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The project owner is responsible for the implementation of measures to prevent,
minimize, and correct environmental impacts in the implementation of investment projects and
activities as well as for reasonable compensation for relocation, restoration, or damages, as
may be applicable for the project, as well as the control, correction, and reporting in the event
of environmental emergencies.
Environmental Impact Assessment
The Decree on Environmental Impact Assessment No. 389/PMO dated October 20, 2022
(“EIA Decree ”) details the process for the submission and approval of the Environmental
Impact Assessment (“ EIA”) and Environmental Social Management and Monitoring Plans
(“ESMMP ”). An EIA is defined in the EIA Decree as “a process of studying, surveying,
analyzing and evaluating positive and negative impacts on social and natural environment
caused by investment projects and activities both in the short and long terms, including setting
appropriate methods and measures to protect, avoid, and mitigate those impacts”.
There are two types of EIAs:
a. Initial Environmental Assessment (“ IEE”), which is conducted for projects expected
to generate low or insignificant environmental social impacts; and
b. Environmental and Social Impact Assessment (“ ESIA ”) is for activities that are
expected to generate significant or adverse environmental and social impacts.
An ESIA report is the result of the studies on the environmental impacts generated by
investment projects and activities which will include direct and indirect impacts on living
organisms, ecology, and the environment so that measures to prevent, mitigate and remedy the
potential environmental impacts can be determined. The ESIA report has to provide clear
information and be easy to understand including the methodology and data collection technique
that have been applied in the ESIA process.
While contents may differ depending on the type of project, an ESIA must include project
descriptions, alternatives, baseline information on the existing environment such as physical,
biological, socio-economic, environmental information in the project area and its proximity,
cumulative impacts, compensation, resettlement and occupations and restoration of people’s
livelihood, health impacts, gender, ethnicity as well as the appropriate methodology and
measures to prevent, reduce, and mitigate properly the potential environmental impacts and
disasters.
The ESIA Report must be prepared in Lao language, while for a complex project has to
be prepared in both Lao and English. For a health risk associated project, the project owner has
to prepare a separate health impact assessment report in parallel with the preparation of the
ESIA Report.
All mineral operations involving metallic minerals require an ESIA report.
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Environmental Certificate
The Environmental Certificate (“ EC”) is the document certifying the environmental
acceptance of the ESIA and ESMMP for the investment project and activities. The EC that
endorses the ESIA has validity for the lifetime of the project but may be subject to either
suspension or withdrawal, while the approval of the ESMMP is valid for two to five years
depending on the investment project, and subject to renewal. An EC may be suspended if it is
found that the investment project violated environmental laws and regulations but with no
serious environmental impact, failed to comply with conditions of the EC, failed to comply
with financial, environmental or other obligations under laws and regulations, non-
implementation of the ESMMP , hidden or concealed or unreliable and non-existing
environmental impact information, non-implementation of mitigation measures after receiving
notification from natural resources and environment authorities, or project is with significant
impacts on people’s health, livelihood, assets, and environment. If the EC is suspended, the
project owner has to stop the operations of the investment project. The owner is provided with
a timeframe to improve and mitigate the problem causing the suspension.
An EC is withdrawn if the suspension conditions are not implemented, the project owner
has made no action on the project 2 years after obtaining the EC, or if there is violation of
environmental laws and regulations that cause significant environmental impacts.
Environmental Protection Fund
The project company is required to contribute to the Environmental Protection Fund
(“EPF”) and the funding obligations under the ESMMP . The EPF is allocated for use in
research for environmental protection and green development, mitigation of climate change
impacts, etc., pollution prevention and control, development of environmental laws and
regulations, environmental studies, capacity building and awareness, environmental
management and problem solving, and for the EPF’s administration and investment.
Water Law
The Law on Water and Water Resources No. 23/NA dated May 11, 2017 (the “ Water
Law”) grants rights to individuals, legal entities and incorporated bodies to use water for any
objectives provided that such usage is economical, reasonable, and efficient, and does not have
major impact on environment, society or nature. The Law on Water and Water Resources
classes the use of water into three categories, namely small, medium, and large water usage,
and requires that medium and large usage of water shall be subject to the approval of the
natural resource and environment sector. The entity involved in activities that uses medium and
large amounts of water shall also pay natural resource royalties for the water usage according
to the relevant regulation.
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Under this Law, the use of water is considered medium size usage for use of water in
mineral manufacturing at 15 to 1,000 cubic meters per day. Water-related activities that are
considered large size water usage activities include the use of water in mineral manufacturing
exceeding 1,000 cubic meters per day.
Taxation
Income Tax
The Law on Income Tax No. 67/NA dated June 18, 2019 (the “ Income Tax Law ”) as
amended by the Law on the Amendment of Certain Articles of the Laws on Taxation No. 01
dated August 7, 2021 (the “ Tax Amendments Law ”) enumerates the obligations and measures
in relation to income taxation.
(1) Corporate Profit Tax Rate
Corporate Profit Tax rate is 20%, for general businesses and 35% for mineral mining
concessions unless otherwise specified in the concession agreement entered into between
the Laotian Government and the concessionaire.
(2) Personal Income Tax Rates
For personal income tax, the progressive tax rate is from 0% to 25% of salaries,
wages, overtime payments, allowances, bonuses, and other benefits, in cash or in kind.
(3) Other Relevant Income Tax Rates
(1) Income tax at the rate of 2% for:
— Share purchase and transfer
— Construction and maintenance services
(2) Income tax at the rate of 5% for:
— Gift either in kind or in cash
— Intellectual property
— Consultancy fee
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(3) Income tax at the rate of 10% for:
— Dividend or other benefit paid to shareholders
— Leases, such as lease of land, house constructed items, vehicles,
machinery, or other assets
Companies doing business in Laos are generally subject to tax based on the Lao tax
legislation as enacted at the time.
V alue Added Tax
V alued added tax (“ VAT”) is imposed on various goods and services under the amended
V alue Added Tax Law No. 48 dated June 20, 2018 (the “ V AT Law”), as amended by the Tax
Amendments Law and the Decree on the Revision of the V alue Added Tax Rate No. 003/PO
dated March 19, 2024. Under these legislation, V A T at the standard rate of 10% shall be
collected from the following activities:
1. Importation of goods;
2. Supply of goods and services in Lao PDR that are subject to V A T collection;
3. import of minerals and supply of minerals within the country;
4. use of electricity for general electricity consumers, producers, distributors.
Export of goods is imposed V A T at zero (0%) rate. On the other hand, V A T exemption is
granted for mineral export and electric power export to a foreign country or to a special
economic zone.
V A T exemption is also granted for certain imported goods such as raw materials used in
the production of fertilizers and pesticides; materials and machinery for agricultural purposes;
raw materials for production and parts for manufacturing for export; materials for production
that may not be procured or manufactured in Laos and machineries for use as fixed assets and
use directly in manufacturing activities; aircraft and materials for use in air transportation
domestically and internationally; fuel oil and other oil for use in the provision of air
transportation services; vehicles for specialized operations that is used in the operations for
public interests, fire extinguisher truck, maintenance car, television and radio signal car, and
other cars of public sector or social organizations.
Provision of certain goods and services within the country are also exempt, such as raw
materials, materials for assembling, and parts for manufacturing for export; international
transportation; products sold on aircraft providing air transportation services; deposit interest,
loan interest, income from money transfers, profit margin from exchange rate and other
financial transactions from the operations of a commercial bank or other financial institution
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as authorized Bank of the Lao PDR; return on investment in securities listed in the stock
market, provision of securities market services, securities depository services, intermediary
services for securities that provide services in the securities sector, and other services in the
securities sector; and health, life, and plantation insurance business.
Customs Duties
The Law on Customs No. 04/NA dated December 20, 2011 and Law on Customs (revised
on certain articles) No. 57/NA December 24, 2014 (collectively, the “ Customs Law ”) require
all types of exported and imported goods to be subjected to customs declaration according to
the code of each type of good as prescribed in the International Harmonized System. The Law
nevertheless acknowledges that to promote investment and motivate production, certain goods
and articles are eligible for reduction or exemption of customs duty and other obligations as
provided in the Investment Promotion Law.
The Presidential Decree on the List of Goods and Export Tax Rates No. 001/PO dated
August 28, 2023 lists the goods and applicable export tax rates, including for copper (10%) and
gold (5%). Nevertheless, Instruction No. 09899/TD dated October 4, 2023 issued by the Tax
Department notified that for large-scale mining projects that have a mineral exploration and
production agreement with the Laotian Government, the same will be implemented according
to such agreement, subject to the negotiation of amendments to implement the Decree No.
001/PO.
LA WS AND REGULATIONS IN RELATION TO OUR OPERATIONS IN GHANA
Regulations relating to Minerals and Mining Activities (Constitution, Minerals and
Mining Act 2006 (Act 703), Minerals and Mining (Licensing) Regulations 2012 (L.I 2176)
and Minerals and Mining-Health, Safety and Technical Regulations, 2012 (L.I 2182), the
Minerals and Mining (Explosives) Regulations 2012 (LI 2177) and Minerals and Mining
(Local Content and Local Participation Regulations, 2020 (L.I 2431)
The Government of Ghana through the Ministry of Lands and Natural Resources in
conjunction with the regulatory body; the Minerals Commission act on behalf of the Republic
of Ghana in all transactions related to minerals. The current legislative, regulatory and
contractual framework for mining in Ghana is contained in provisions relating to mining in the
1992 Constitution of Ghana (the “ 1992 Constitution ”) and more specifically in the Minerals
and Mining Act 2006 (Act 703) as amended, (the “ Mining Act ”) as well as the mining
regulations promulgated as subsidiary legislation under the Mining Act (the “ Mining
Regulations ”).
The Constitution and the Mining Act establish a domain system of mineral ownership
which vests the State with legal ownership of all minerals occurring in their natural state within
Ghana’s land and sea territory, regardless of who owns the land upon which the minerals are
situated.
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Minerals are defined in the Mining Act to include “any substance in solid or liquid form
which occurs naturally in or on the earth or under the seabed formed by or subject to geological
process, including building and industrial minerals and “mineral rights” under the Act include
reconnaissance license, prospecting licence and mining lease.
The Mining Act and the Mining Regulations set out in great detail the various types of
mineral rights that could be granted at each stage of the mining sequence in the form of
reconnaissance, license exploration or exploitation license/mining lease, the eligibility criteria
for the grant of a specific license and the rights and obligations attached to each license that
is granted under the Mining Act.
In broad terms, no qualify for the grant of a mineral right under the Mining Act and the
Mining Regulations an applicant must be a Ghanaian registered body corporate established in
Ghana under a law in force. Foreign registered companies are therefore not allowed to hold
reconnaissance, exploration or mining licences directly within the mining industry, without
first being incorporated locally. Prior to making an application, the prospective applicant must
conduct an official search on the Cadastral search on the Mineral Title Register kept by the
Minerals Commission to ascertain whether the targeted area is unencumbered. Standard
application forms would then be obtained from the Minerals Commission, duly completed by
the applicant with the requisite supporting documents and submitted to the Minerals
Commission for review and processing. The application is evaluated on the basis of the
financial and technical capability of the applicant to carry out the mineral activity applied for
and applications are treated on a first come first served basis. Successful applications are then
recommended to the Minister for Lands and Natural Resources (the “ Sector Minister ”) who
would actually issue a licence on behalf of the Government of Ghana.
All agreements granting mineral rights are required to be stamped under the Stamp Duty
Act 2005 (Act 689) and registered at the Land Registry in the Region where the land is situated
in accordance with the Land Act 2020 (Act 1036) Additionally, unless specifically exempted
by parliament, contracts involving the grant of rights to exploit minerals (i.e. mining leases)
must be ratified by parliament. Similarly, an assignment, transfer, mortgage or similar dealings
in mineral rights also require the prior approval of the sector Minister.
Regulations relating to Production of Gold and other Minerals
Only duly licensed persons under the Mining Act and the Mining Regulations may engage
in the production, export, sale or disposal of a mineral including gold. The Mining Regulations
set out in detail the application procedures to obtain a licence for the production, export, sale
or disposal of minerals.
The holder of a mining lease may apply to the sector Minister to export, refine and sell
its mineral produce. Such application must be accompanied with a refining contract with a
credible refinery and a sales and marketing agreement with the company that would sell the
refined gold. A lessee who is granted a licence to export and sell its gold produce is also
required by the terms and conditions of the gold export licence prior to each shipment to
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furnish the Minerals Commission with particulars of the quantity and grade of the minerals to
be shipped before making any shipment and provide access for a government approved assay
laboratory to assay each consignment of gold shipment.
Bank of Ghana (“ BoG”) Authorisation is also required for export of unprocessed minerals
under the Export and Import Act (Act 503). This authorization is compiled with by the
completion of BoG Form A2 that must be endorsed by an authorized bank in Ghana.
Regulations relating to Labour Matters pursuant to the Constitution, the Labour Act and
the 2012 Health, Safety and Technical Regulations
The Constitution, Labour Act 2003 (Act 651) and subsidiary regulations made since 2007
under the Act regulate all legal issues pertaining to labour matters in Ghana and must be
complied with.
Additionally, mining industry specific regulations are set out in the 2012 Health, Safety
and Technical Regulations. The regulations provide for the safety of workmen and conditions
of employment, maximum working hours for employees as well as the minimum age for
employment in a mine. A person shall not be employed in a mine unless that person is at least
eighteen years old, and a person shall not work in an underground mine unless that person is
at least 21 years old. The regulations provide detailed requirements on the mine environment
such as safety of mine workers, mine- risks and how to eliminate or minimize such risks. The
regulations also require every mine must employ a duly qualified and competent mine manager
who must be certified by the Chief Inspector of Mines. A mine manager must employ a
supervisor who is able to communicate effectively with the employees who work under that
supervisor.
The manager of a mine is required to ensure that an employee does not undertake any
work in the mine unless the fitness and health of that employee has been assessed as sufficient
to enable that employee to carry out that work. The health and fitness of employees must also
be assessed regularly to determine that each employee is capable of performing his duties
assigned to him at all times.
Regulations relating to Protection of the Environment
The Environmental Protection Agency (“ EPA”) established by the Environmental
Protection Agency Act 1994 (Act 490) is responsible for ensuring conservation and protection
of the environment. The EPA performs this function through its subsidiary legislation the
Environmental Assessment Regulations, 1999 (LI 1652).
Environmental issues relating to mining are regulated by the EPA in accordance with the
EPA Act and the regulations made thereunder.
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As far as environmental issues are concerned, the holder of a mineral right must obtain
necessary approvals and permits from the EPA before commencing any mining activity or
operation. Holders of mineral rights are also required to comply with other applicable
regulations made under the Mining Act or other enactments in force such as obtaining a permit
from the Forestry Commission where the proposed mining activity falls within a Forest
Reserve. With regard to utilisation of water from natural sources for mining purposes or the
disturbance of the natural flow of a water body, the holder of a mineral right is required to
obtain a water right in the form of license or permit from the Water Resources Commission.
Such water rights would permit the mining company to extract the water for mining operations
or divert it in furtherance of the mining or ancillary operations.
Some of the tools employed by EPA for protecting the environment and ensuring
environmental compliance by the mining companies include the requirement for the
performance of an environmental impact assessment (“ EIA”) in respect of mining operations;
an environmental management plan in respect of active mining operations; and the posting of
an environmental bond to meet the cost of reclamation after the mining operation. The EPA
requires a full blown EIA to be undertaken as part of any major mining undertakings. The EIA
report is presented in a format specified in the regulations. This is published in the media and
subjected to a public hearing also to the local community of the propose mining project. By
law, at least a third of the panellists to preside over the public hearing must be appointed from
within the community within which the mining activity is to be undertaken.
Under the Forestry Regulations, a permit is required from the Forestry Commission where
a mining licence or activity falls within a forest reserve.
Regulations relating to Foreign Investment
New entrants into the mining sector who are foreigners are required to register with the
Ghana Investment Centre (“ GIPC ”) established as a body corporate under the Ghana
Investment Promotion Centre Act, 2013 (Act 865) (the “ GIPC Act ”) and satisfy a minimum
capital investment requirement of US$200,000 in cash or kind. Registration with the GIPC
provides certain investment guarantees and incentives under the GIPC Act, such as approved
immigration quota to employ foreign nationals, free transferability of foreign currency through
an authorized dealer bank for payment of dividends to foreign shareholders, foreign debt
servicing and remittance of net proceeds from the sale of the registered enterprise.
Regulations relating to Foreign Currency
Under the Mining Act, a lessee or a licensee who earns foreign currency from its mining
operations may be permitted by the Bank of Ghana to retain, in a designated account, a portion
of the foreign currency earned from the mining operations for use in acquiring spare parts
machinery and other inputs required for the mining operations. The Mining Act provides
further that the Minister of Finance may permit the holder of a mining lease, where the net
earnings from the holder’s mining operations are in foreign currency, to open and retain in an
account not less than 25% of the foreign currency earned from the mining operations for the
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acquisition of spare parts, raw materials, and machinery and equipment, debt servicing and
dividend payments, remittance in respect of quotas for expatriate personnel, and the transfer of
capital in the event of a sale or liquidation of the mining operations. Such retention account
must be opened and held in trust by a trustee bank appointed by the lessee or licensee with
approval by the Bank of Ghana. A lessee or licensee is further guaranteed free transferability
of convertible currency through the Bank of Ghana or, in the case of a net foreign exchange
holder, through the trust account.
Regulations relating to Taxation of Mining Companies
Royalties
Under the section 25 of the Mining Act as amended a licensee holding mining lease
restricted mining lease or small scale mining lease is required to pay royalties to the state at
the rate and the manner that may be prescribed by regulations made under the Act. The current
applicable rate of royalty is 5% of the total revenue derived in respect of all minerals won from
the mining operations. The royalty is payable quarterly to the Ghana Revenue Authority.
Other Taxes
Corporate income tax
Under the Income Tax Act 2015, as amended, the current corporate income tax rate for
a mining company is 35 per cent of net profits. The net profit is determined after deductions
of operating costs, allowable capital expenses and investment allowances.
Thin capitalisation restrictions by limitations on debt-to-equity ratio
Section 71 of the Internal Revenue Act 2000 (Act 592) provides for a maximum 2:1 debt
to equity ratio for the purposes of allowing interest expense on inter-company debt to be
deductible from taxable income.
Where the inter-company debt to equity ratio exceeds 2:1 such interest expense is not
permitted to be deducted from taxable income of a resident company. This 2:1 debt to equity
ratio would be applicable to every producing company, unless a higher ratio is negotiated with
the government and included in the Stability Agreement or Development Agreement, both of
which must be approved by parliament.
Carry-over of tax losses
Under the Internal Revenue Act, the period for which losses may be carried forward and
set off against future corporate profits is up to a maximum period of five years only in the case
of a mining business venture.
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For mining companies that had negotiated longer, or unlimited loss carry forward periods
in their project investment agreements, as is the case of the thin capitalization ratio, the
government has in recent times taken the position that all mining companies must have a level
playing field, hence the five-year period contained in the Internal Revenue Act should apply
to all mining companies.
Consequently, the government through bilateral negotiations re-negotiated the relevant
provisions with the companies that had been granted longer loss carry forward periods.
Withholding taxes
Under the Internal Revenue Act all mining companies unless exempted by specific
agreements with the government are required to withhold tax on payments made to third
parties, both resident and non-resident in respect of payments for services rendered by such
third parties, including management, contractors, sub-contractors and technical service fees,
payable to affiliates and non-residents.
The applicable rate of withholding tax varies depending on the nature of the service and
when it is payable. The current applicable withholding tax rates are:
 15% withholding tax on management consulting, technical service and endorsement
fees;
 8% withholding tax on interest payments on foreign debt, including inter-company
loans; and
 8% withholding tax on dividends paid to shareholders.
V alue added tax (“ VAT”), national health insurance levy (“ NHIL ”), Ghana education trust
(GET) fund levy (“ GET FUND ”) and COVID-19 Levy
Mining companies and their affiliates, or contractors, and subcontractors are not
exempted by law from the payment of V A T, NHIL, GET FUND, COVID-19 Levy on goods and
services whether procured locally or imported.
However, the existing legal arrangements permit the mining companies and their
contractors or subcontractors to pay the V A T as the normal output tax and claim a refund from
the V A T Service as input tax. The rates currently applicable are V A T at 15%, NHIL at 2.5%,
Get Fund at 2.5% and COVID-19 Levy at 1%. In practice the refund arrangements may not
have not been implemented effectively resulting in a significant back-log of various sums due
to certain mining companies.
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Mining companies may have been granted specific exemption from payment of V A T and
NHIL in their specific mining project development agreements with the Government which
were duly approved/ratified by Parliament in accordance with Articles 174 and 268 of the
Constitution.
Import duties and excise taxes
The Mining Act currently permits exemption from payment of customs import duties and
excise taxes on mining equipment, plant and machinery which are imported for use exclusively
for mining operations.
The list of exempted items is contained in the Official Mining List which is settled
between the Government agencies (Ghana Revenue Authority, Minerals Commission) on the
one hand and the Ghana Chamber of Mines representing the Mining Companies.
Capital gains tax
Under the Internal Revenue Act the capital gains tax rate is 10% payable by any person
on gains accruing from the realization of a chargeable asset. Chargeable assets are defined to
include buildings, business assets, land, rights, or interest in shares and stocks.
Other charges and fees
Ground rent is payable annually to the owner of the land in respect of which a mineral
right is granted. Annual ground rent payable is GH
₵15 per square acre. If the land in question
is stool land, this rent is paid to the Office of the Administrator of Stool Lands who acts as a
public trustee for incomes and revenues due from stool lands.
The Minerals Commission charges annual mineral right fees based on the size of the land
holding and various consideration fees for its services relating to its mandate of regulation and
management of Ghana’s Mineral Resources. These service and the related consideration fees
are set out in the 2012 Licensing Regulations LI 2176. The fee rates applicable differ for
Ghanaian and foreign controlled companies.
Regulations on Hazardous Chemicals: Minerals and Mining (Explosives) Regulations,
2012) (L.I. 2177)
These Regulations govern the conveyance, storage, possession, manufacture and use of
explosives for mining as well as substances used for the manufacture of explosives. The
regulations require a permit/license granted by the inspectorate Division of the Minerals
Commission to undertake any of such activities relating to manufacturing, purchase,
conveyance, storage and use of explosives. The Regulations put the onus of safety of
explosives on the manager of a mine. The mine manager is required to submit detailed plans
with proposed activities relating to explosives to the Chief Inspector of Mines for approval.
The Regulations also set out monitoring and environmental limits for pollution.
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Regulations on Land and Immovable Property
There are three main categories of land ownership in Ghana;
(i) Stool/Skin Land which is land owned by various traditional communities bound by
kingship ties and which is held in trust for the communities by the communal leaders
such as stools or skins. Such land represents the highest proprietary interest known
to customary schemes of interest in land and is therefore often referred to as the
allodial or absolute title.
(ii) Family land which is land owned collectively by various traditional family
groupings and held in trust for them by the Head of Family.
(iii) Private/individual land which is land vested in individuals or private entities. This
ownership arises mostly because of dispositions of customary land interests through
common-law type conveyances under various statutes.
Much of the land upon which minerals are situated in Ghana is not public land which is
owned by the State. However, since the State owns and grants mineral rights, the grant of such
rights necessarily raises an issue of how to give legal access to the land upon which the mineral
is situated.
The Mining Act deals with the issue by providing that a mineral right granted by the
sector Minister under the Mining Act is sufficient authority for the holder over the land and
entitles the holder to enter the land in respect of which the mineral right is granted, subject to
the payment of compensation to the land owner or any occupier of the land who is impacted
by the mineral operations.
Consequently, the Minerals and Mining (Compensation and Resettlement) Regulations
2012 (LI 2175) set out clearly the rules for making claims of assessment of compensation or
resettlements of persons impacted by mineral operations where necessary.
Thus, the grantee of a mineral right has an automatic legal access and right of entry into
the land over which the mineral right has been granted. This dispenses with the necessity of
the grantee obtaining the express permission of the landowner even where it is not public land
that is involved.
The current legal regime for mining therefore makes no legal provision for the express
permission of the landowner to be sought in order to gain access to the land for purposes of
mineral operations.
REGULATORY OVERVIEW
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However, the procedure for accessing applications for the grant of mineral rights requires
that notice of an application for a mineral right must be published in the locality to be affected
by the grant for a period of 21 days and also in the National Gazette. This is expected to afford
landowners and the local community the opportunity to raise any objections they may have to
the application.
The automatic access to land over which a mineral right is granted is expressly made
subject to the payment of appropriate compensation to the land owner or occupiers of the land
for any disturbance or damage caused to their surface rights by the mining activity.
Exploration – Rehabilitation and Restoration of Vegetation
Surface mining
The manager of a mine is tasked with preparing and implementing a mine design that is
based on sound geotechnical engineering practices and which takes into account: the geology
of the mine, assesses the ground stability of the active and proposed workings of the mine,
previous occurrences of ground instability and considers as far as is reasonably practicable, the
health and safety of workers, and is prepared under the direction of a qualified person.
Dredging: The holder of a mining lease is prohibited from using a dredge in a mining
operation unless approved in writing by the Chief Inspector of Mines. A manager is required
to ensure that a dredge used at the mine is equipped with adequate and suitable fire-fighting
equipment, adequate guard rails to prevent any worker from falling over the edge into the
water, among others.
A manager has a duty to ensure that a dredge is equipped with lifesaving equipment that
is necessary to preserve the lives and enable the rescue of persons who may fall overboard the
dredge.
Underground mining
A manager of a mine is required to ensure that where the natural strata is not safe, each
working or pumping shaft, and travelling way, airway or working place is securely supported,
filled, walled up or otherwise made secure and kept in a safe condition as long as that shaft is
in actual use.
REGULATORY OVERVIEW
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Quality of underground mine air: ventilation and dust prevention
A mine manager is required to ensure that adequate ventilation is supplied to places where
persons are travelling or working underground.
Adequate ventilation means that the amount of oxygen in the general body of air should
not be less than 19% by volume and the amount of carbon dioxide, carbon monoxide, nitrous
fumes, sulphur dioxide and hydrogen sulphide in the general body does not exceed the required
percentages, among others.
Rehabilitation and Mine Closure
During the environmental permit application process, where the EPA determines that a
mining project requires a reclamation plan, the mining company will be required to post a
reclamation bond based on approved work plan for reclamation.
Regulations relating to Local Content Requirements for the Mining Industry
In 2020, new regulations were promulgated under the Minerals and Mining (Local
Content and Local Participation) Regulations. The main purpose of the regulations is to expand
and deepen Ghanaian participation in the local mining industry. This is to be achieved legally
through the use of local expertise, local purchase of specified mining related products and the
complete reservation of certain services to Ghanaian citizens or businesses owned by Ghanaian
and a monitoring and reporting system to monitor compliance with the regulations.
Under the regulations a holder of a reconnaissance license or prospecting licensee is
required to submit the Minerals Commission for approval a localization programme for
recruitment and training of Ghanaians. The regulations require that services such as insurance
risks, accounting and legal services shall only be performed by firms licensed to practice in
Ghana. Administrative penalties are prescribed by the regulations for breaches committed by
persons or entities to which the regulations apply.
REGULATORY OVERVIEW
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OVERVIEW
We are a fast-growing international gold producer principally engaged in mining,
processing and sales of gold. The history of our Group operating our current business dates
back to December 2012 upon completion of the major asset restructuring of our Company when
Jilong Mining became our first subsidiary carrying out mining and ore processing activities in
the Jilong Gold Mine in Chifeng, Inner Mongolia Autonomous Region, the PRC.
Over the years, committing to our management concept of “Mutual Prosperity and
Development”, we have grown into the largest non-state owned gold producer in the PRC and
developed our global presence through acquisition of quality Mineral Resources in Laos and
Ghana. As of the Latest Practicable Date, we owned and operated seven gold and polymetallic
mines across the world. Our A Shares are listed on the Shanghai Stock Exchange under stock
code 600988.
OUR BUSINESS MILESTONES
The following table sets forth the business milestones of our Group:
Y ear Milestone
2012 /H1118/H1118/H1118/H1118/H1118/H1118/H1118Our Company acquired Jilong Mining, which operates the Zhuanshanzi
Gold Mine, the first mine of our Company, and renamed as “Chifeng
Jilong Gold Mining Co., Ltd.”. This represents the formal listing of our
current business on the Shanghai Stock Exchange.
2013 /H1118/H1118/H1118/H1118/H1118/H1118/H1118Our Group commenced the first expansion of our gold production
business through acquisition of Wulong Mining, which operates the
Wulong Gold Mine.
2018 /H1118/H1118/H1118/H1118/H1118/H1118/H1118Our Company acquired the entire equity interest in Chijin Laos which
held a 90% equity interest in LXML, the owner and operator of the
Sepon Gold and Copper Mine in Laos. It marked our first success in
overseas expansion.
2019 /H1118/H1118/H1118/H1118/H1118/H1118/H1118Our Company acquired the entire equity interest in Hanfeng Mining,
which operates the Hanfeng Polymetallic Mine. This represents our
further expansion into a diversity of Mineral Resources production.
2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118Our Group achieved an exponential growth in respect of its production
capacity, doubling the total tonnage of gold resources for three
consecutive years from approximately 1.52 tonnes in 2018 to 2.07
tonnes in 2019, to 4.59 tonnes in 2020, and further to 8.10 tonnes in
2021.
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Y ear Milestone
2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118Our Group acquired a majority stake in Golden Star Resources, which
held our operations in the Wassa Gold Mine in Ghana. This marked a
scalable overseas expansion into operations in Ghana.
2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118LXML celebrated its 20th anniversary of operations, and its celebratory
ceremony was attended by the Prime Minister of the Lao People’s
Democratic Republic.
MAJOR CHANGES IN SHAREHOLDING AND SHARE CAPITAL OF OUR COMPANY
1. Promoting for Establishment and Initial Capital Increases
Our Company was initially established on June 22, 1998 by the Initial Shareholders (see
below). Our Company had not commenced substantive operations since its establishment and
up to April 1999 upon when it acquired from its then controlling shareholder, Jin’an
Automobile (as defined below) the assets and facilities required for production of specialized
vehicles. Since then, our Company became principally engaged in the research, development,
production and sales of special vehicles and automotive parts, and in particular, armored
cash-in-transit vehicles. On July 17, 2000 and August 23, 2000, respectively upon approval
from the Guangzhou City Commission for Restructuring the Economic System ( ᄿψ̹຾᏶᜗
ึ) and the Guangzhou City Administration for Industry and Commerce ( ᄿψ̹ʈ
၍ଣ҅), our Company was converted into a joint stock company with a registered share
capital of RMB45,860,000, whereby the audited net assets of approximately RMB45,860,000
of our Company were converted at a rate of 1:1 into 45,860,000 Shares of a par value of
RMB1.00 each. The shareholding structure of our Company immediately upon completion of
the conversion was as follows:
Names of the Initial Shareholders
Committed
capital
contribution
Percentage of
shareholding
RMB
Guangdong Jin’an Automobile Industrial
Engineering Company Limited (τӛԓ
ʮ̡)( “ Jin’an Automobile ”)(1) /H1118/H1118 27,516,000 60.00%
Huang Yizhen (ޜ1) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111817,380,940 37.90%
Y ang Wenjiang ( เ˖Ϫ)(1) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118458,600 1.00%
Y ang Wenying (ߵ1) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118458,600 1.00%
Y ang Jinpeng (؃ږ1) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111845,860 0.10%
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111845,860,000 100.00%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Note:
(1) To the best knowledge of our Directors having made all reasonable enquiries, they were all Independent
Third Parties as of the Latest Practicable Date. These shareholders are collectively referred to as the
“Initial Shareholders ”.
Upon resolutions at the general meetings of our Company on March 31, 2001 and March
8, 2002, our Company increased its registered share capital to RMB50,446,000 and then to
RMB65,579,800 pursuant to bonus issues on the basis of one and three new Shares for every
ten existing Shares held by the above Shareholders by way of conversion of capital reserve,
respectively. Upon completion of the bonus issues on April 29, 2002 and May 28, 2002
respectively, the shareholding percentage of the above Shareholders remain unchanged.
2. A Shares Offering and Listing on Shanghai Stock Exchange in April 2004
As approved by the CSRC, our Company completed the initial public offering of the A
Shares, which were issued at an offer price of RMB9.08 per A Share, upon which our A Shares
became listed on the Shanghai Stock Exchange under stock code 600988 on April 14, 2004.
Upon completion of the A Shares offering, the registered share capital of our Company was
increased to RMB90,579,800. Upon listing on the Shanghai Stock Exchange, our Company’s
principal business remained the production and sales of armored cash-in-transit vehicles and
other specialized vehicles.
The shareholding structure of our Company immediately after the A Shares offering was
as follows:
Names of the Shareholders
Number of
A Shares Held
Percentage of
Shareholding
Jinan Automobile /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111839,347,880 43.44%
Huang Yizhen /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111824,854,744 27.44%
Y ang Wenjiang /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118655,798 0.72%
Y ang Wenying /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118655,798 0.72%
Y ang Jinpeng /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111865,580 0.07%
Public A Shareholders /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825,000,000 27.60%
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111890,579,800 100.00%
Note: The shareholding percentage figures above does not add up to 100.00% due to rounding of decimal
places.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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As of the Latest Practicable Date, our Company had not received any notice from the
Shanghai Stock Exchange alleging any material non-compliance incidents on the part of our
Company. As advised by our PRC Legal Advisor, our Directors confirm that our Group had
been in compliance with the applicable listing rules of the SSE and the applicable securities
laws and regulations in all material respects since our A Share restructuring and listing on the
SSE to the Latest Practicable Date and to the best knowledge of our Directors after having
made all reasonable inquiries, there is no matter that should be brought to the attention of the
investors and the Hong Kong Stock Exchange in relation to our compliance record on the
Shanghai Stock Exchange. Based on the due diligence conducted by the Sole Sponsor including
but not limited to the review of the legal opinion issued by our PRC Legal Advisor and
confirmations from our Company, nothing has come to the attention of the Sole Sponsor that
would cause the Sole Sponsor to reasonably doubt the aforementioned view of our PRC Legal
Advisor.
3. Reform of Non-tradeable Shares in April 2007
Pursuant to the Administrative Measures on the Reform of Non-tradeable Shares of Listed
Companies Companies (جpromulgated by the CSRC on
September 4, 2005, companies listed on a domestic stock exchange in the PRC are required to
eliminate the trading restrictions on their non-tradeable shares through an arrangement that
seeks to balance the interests of holders of non-tradeable shares with those of holders of
tradeable shares. In accordance with such measures, holders of more than two-thirds of a listed
company’s non-tradeable shares shall have the power to propose and then negotiate a
conversion scheme with holders of tradeable shares. The conversion scheme is then subject to
the approval of two-thirds majority of the tradeable shares participating in the vote and
two-thirds majority of all the shares participating in the vote.
On March 30, 2007, our Company resolved at a general meeting to carry out a share
reform pursuant to which our Company issued to each shareholder 3.6232 new Shares for every
10 Shares held by the holders of tradeable Shares (meaning the public A Shareholders referred
to above), and the shares held by the non-tradeable Shareholders (meaning the Initial
Shareholders) became tradeable. Immediately before the reform, the share capital of our
Company comprised 65,579,800 non-tradeable Shares held by the Initial Shareholders and
25,000,000 tradeable Shares held by the public A Shareholders.
Immediately after the completion of the reform upon the approval from the Shanghai
Stock Exchange on April 18, 2007, the share capital of our Company comprised a total of
99,637,800 A Shares, of which 65,579,800 A Shares held by the Initial Shareholders were
subject to certain trading restrictions, namely that the Initial Shareholders agreed not to sell or
transfer any of their shares in our Company within 12 months from the completion of the
reform (the “ Lock-up Period ”), and each of Jin’an Automobile and Huang Yizhen further
agreed that the proportion of A shares sold by them would not exceed 5% and 10% of the total
share capital of our Company for the 12 and 24 months from the expiry of the Lock-up Period,
respectively. The remaining 34,058,000 A Shares were freely tradeable A Shares.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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The shareholding structure of our Company immediately after the non-tradeable share
reform was as follows:
Names of the Shareholders
Number of
A Shares Held
Percentage of
Shareholding
Jinan Automobile /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111839,347,880 39.49%
Huang Yizhen /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111824,854,744 24.95%
Y ang Wenjiang /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118655,798 0.66%
Y ang Wenying /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118655,798 0.66%
Y ang Jinpeng /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111865,580 0.07%
Public A Shareholders /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111834,058,000 34.18%
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111899,637,800 100.00%
Note: The shareholding percentage figures above does not add up to 100.00% due to rounding of decimal
places.
4. Change of controlling shareholder in April 2010 and Major Assets Restructuring in
December 2012
Owing to the default of bank loans owed by the then controlling shareholder of Jin’an
Automobile and the related court petitions, judgements were issued by the Intermediate
People’s Court of Dongguan City of Guangdong Province, pursuant to which, among others,
28,884,100 Shares held by Jin’an Automobile, accounting for approximately 28.99% of the
registered share capital of our Company, were directed to be transferred to Mr. Wu Peiqing ( ю
ڡ“() Mr. Wu”), an Independent Third Party. Accordingly, the controlling shareholder of our
Company was changed to Mr. Wu by April 2010. Since then and up to the completion of the
Major Asset Restructuring (as defined below), our Company was principally engaged in
production and sales of special vehicles (including armored cash-in-transit vehicles), property
leasing and commodities trading (the “ Original Business ”).
In light of the poor business and financial performance of our Group whereby our Group
had been in net loss position throughout the years from 2008 to 2011, in addition to which our
Company had defaulted in various judgment debts leading to court enforcement actions against
various assets comprising, among others, vehicles and real properties of our Group. Since April
2010 and up to the completion of the Major Asset Restructuring, our Company was then
imposed with a delisting risk warning by the SSE in accordance with its listing rules.
In an attempt to rescue our Group from its then difficult operating conditions, resume its
going concern capabilities and provide new growth opportunities to enhance the shareholders’
return, on February 23, 2012, upon resolutions by the Board, our Company entered into, among
others, a restructuring framework agreement with Mr. Wu and the then equity interest holders
of Jilong Mining, namely (i) the late Mr. Zhao Meiguang (Έ, the late husband of Ms. Li,
the “ late Mr. Zhao ”, whereby Ms. Li inherited the Shares from the late Mr. Zhao upon his
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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passing away in December 2021 pursuant to his will, and the aforesaid transfer of Shares was
completed by April 30, 2022); (ii) Ms. Zhao Guixiang (࠰࣭iii) Ms. Zhao Guiyuan (࣭
ధ) (both being the sisters of the late Mr. Zhao); and (iv) five Independent Third Party
individuals, pursuant to which our Company agreed to dispose of all its assets comprising the
Original Business on a debt-free basis to Dongguan Weiyuan Industrial Group Company
Limited (ʮ̡, a company controlled by Mr. Wu who was its legal
representative), whereas the then equity interest holders of Jilong Mining agreed to sell their
entire equity interest in Jilong Mining to our Company in consideration of our Company
issuing an aggregate of 183,664,501 Shares to them at the issue price of RMB8.68 per Share,
which was determined on the basis of the average price of A Shares of our Company for 20
trading days preceding the announcement date of the Board resolution, calculated by reference
to the aggregate transaction amount for the trading of our A Shares divided by the aggregate
trading volume of our A Shares during the above period, and accounted for approximately
50.40% of the enlarged share capital of our Company immediately upon completion of the
share issuance (the “ Major Asset Restructuring ”).
Following the resolutions at the general meeting of our Company on April 5, 2012 and the
approvals from the CSRC issued on November 23, 2012, the Major Asset Restructuring was
completed on November 28, 2012. Immediately upon completion of the Major Asset
Restructuring, the registered share capital of our Company increased to RMB283,302,301
divided in to 283,302,301 A Shares and the late Mr. Zhao became the then controlling
Shareholder with approximately a 37.44% shareholding interest in our Company. Our
Company was renamed as “Chifeng Jilong Gold Mining Co., Ltd.” on December 24, 2012.
5. Capital increase in April 2014 and acquisition of Chenzhou Xiongfeng by way of
non-public issuance of A Shares in January 2015
Upon approval at the general meeting of our Company on April 28, 2014, our Company
increased our registered share capital to RMB566,604,602 divided into 566,604,602 A Shares
by way of a bonus issue on the basis of 10 new A Shares for every ten existing A Shares held
by the Shareholders whose name appear on the register of members of our Company on
December 31, 2013 by way of conversion of capital reserve.
On August 8, 2014, upon resolutions by the Board, our Company entered into, among
others, a framework agreement dated August 8, 2014 and an acquisition agreement dated
September 29, 2014 with 30 then Independent Third Party shareholders of Chenzhou
Xiongfeng, pursuant to which our Company agreed to acquire the entire equity interest in
Chenzhou Xiongfeng from those shareholders at a consideration of RMB905.8 million, which
was determined with reference to the appraised value by an independent valuer of the entire
equity interest of Chenzhou Xiongfeng as of March 31, 2014 by way of the income approach.
90% of the consideration was satisfied by way of issuance of an aggregate of 114,016,786 A
Shares to those 30 sellers of the equity interest of Chenzhou Xiongfeng at the issue price of
RMB7.15 per Share, which was determined on the basis of the average price of A Shares of our
Company for 20 trading days preceding the announcement date of the Board resolution,
calculated by reference to the aggregate transaction amount for the trading of our A Shares
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 240 ---
divided by the aggregate trading volume of our A Shares during the above period, as adjusted
by our Company’s capital increase in April 2014 as mentioned above (the “ Adjusted 20
Trading Day Average Price ”), and the remaining 10% of the consideration was satisfied by
way of cash payment. Alongside with the above our Company would conduct a non-public
issuance to no more than 10 specified investors for fund raising of no more than 25% of the
total consideration of the acquisition transaction, representing an issuance of no more than
46,883,500 A Shares at an issue price of RMB6.44 per Share, which was determined at not less
than 90% of the Adjusted 20 Trading Day Average Price in compliance with the requirements
under the Administrative Measures for the Issuance of Securities by Listed Companies and the
Implementation Rules for the Non-public Issuance of Stocks by Listed Companies (collectively
the “ Issuance Regulations ”).
Upon resolutions at the general meeting of our Company on October 23, 2014 and the
approval from the CSRC issued on January 28, 2015, the acquisition was completed on
February 5, 2015, upon which the registered share capital of our Company increased to
RMB680,621,388 divided into 680,621,388 A Shares. In respect of the non-public issuance, the
subscription applications from two institutional investors, being Independent Third Parties,
were accepted for an aggregate of 32,569,360 A Shares. Upon completion of the non-public
issuance on March 12, 2015, the registered share capital of our Company further increased to
RMB713,190,748 divided into 713,190,748 A Shares.
Subsequently, the Board resolved on June 30, 2020 to dispose of the entire equity interest
of Chenzhou Xiongfeng by way of public listing-for-sale on the Beijing Stock Exchange at the
reserve price of RMB1,598,567,800. Upon expiry of the public listing-for-sale on July 29,
2020, Hanfeng United then held by the late Mr. Zhao, Ms. Li and an Independent Third Party
individual as to 71%, 19% and 10% equity interest respectively at the material times, was the
sole transferee expressed intention to purchase such equity interest. Our Company, Hanfeng
United and the late Mr. Zhao entered into a disposal agreement on July 30, 2020 to effect the
above transfer at a consideration of RMB1,598,567,800, which was determined with reference
to the appraised value by an independent value of the entire equity interest of Chenzhou
Xiongfeng as of April 30, 2020 by way of the income approach. The disposal was completed
on December 25, 2020. Based on the publicly available information, 70% and 30% of the
equity interest in Chenzhou Xiongfeng was subsequently sold to Dongjiang Environmental
Company Limited (a company dually listed on the Main Board of the Hong Kong Stock
Exchange (stock code: 895) and the Shenzhen Stock Exchange (stock code: 2672)) and an
individual, both being Independent Third Parties, respectively, on September 16, 2021.
6. Capital increase in October 2017 and acquisition of Hanfeng Mining by way of
non-public issuance of A Shares in January 2020
Upon approval at the general meeting of our Company on October 11, 2017, our Company
increased our registered share capital to RMB1,426,381,496 divided into 1,426,381,496 A
Shares by way of a bonus issue on the basis of 10 new A Shares for every ten existing A Shares
held by the Shareholders whose name appear on the register of members of our Company on
June 30, 2017 by way of conversion of capital reserve.
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On April 19, 2019, upon resolutions by the Board, our Company entered into an
acquisition agreement with the late Mr. Zhao, Hanfeng Zhongxing and Meng Qingguo (ᅅ
਷), an Independent Third Party individual, which were the then shareholders of Hanfeng
Mining, pursuant to which our Company agreed to acquire the entire equity interest in Hanfeng
Mining from those shareholders at a consideration of RMB510 million, which was determined
with reference to the appraised value by an independent valuer of the entire equity interest of
Hanfeng Mining as of December 31, 2018 by way of the asset approach and the income
approach. The consideration was satisfied by way of issuance of an aggregate of 128,787,900
A Shares to those sellers of the equity interest in Hanfeng Mining at the issue price of
RMB3.96 per Share, which was determined on the basis of not less than 90% of the average
price of A Shares for 120 trading days preceding the announcement date of the Board resolution
(the “ 120 Trading Day Average Price ”), alongside with a non-public issuance of A Shares to
no more than 10 specified investors for fund raising of no more than 100% of the total
consideration of the acquisition transaction at an issue price of RMB4.69 per Share, which was
determined at not less than 90% of the average price of A Shares for 20 trading days preceding
the announcement date of the Board resolution in compliance with the requirements under the
Issuance Regulations.
Upon resolutions at the general meeting of our Company on May 31, 2019 and the
approval from the CSRC issued on October 28, 2019, the acquisition was completed on
November 7, 2019, upon which the registered share capital of our Company increased to
RMB1,555,169,374 divided into 1,555,169,374 A Shares. In respect of the non-public issuance,
the subscription applications from three institutional investors, being Independent Third
Parties, were accepted for an aggregate of 108,742,004 A Shares. Upon completion of the
non-public issuance on January 19, 2020, the registered share capital of our Company further
increased to RMB1,663,911,378 divided into 1,663,911,378 A Shares.
MAJOR ACQUISITIONS AND DISPOSALS
1. Acquisition of LXML through Chijin Laos
Leveraging on the growing demand for gold as both a financial instrument and strategic
commodity resources, the scarcity of quality gold resources in the PRC and national policy
support for overseas expansion of domestic companies, on June 21, 2018, upon resolutions by
the Board, our Company (as purchaser) entered into a share purchase agreement with Album
Investment Private Limited (“ Album Investment ”) (as seller) and MMG Limited (a company
listed on the Main Board of the Hong Kong Stock Exchange (stock code: 1208)) (as seller
guarantor) (both being Independent Third Parties), pursuant to which our Company agreed to
purchase from Album Investment all the issued shares of Chijin Laos (which directly held 90%
of the equity interest in LXML, with the remaining 10% equity interest held directly by the
Government of Lao PDR (represented by the Ministry of Finance)) at a consideration of
US$275 million, which was determined after arm’s length negotiation among the parties taking
into account of, among others, the reserves and resources of the Sepon Gold and Copper Mine,
the future extraction and development plan and the appraised value by an independent valuer
of the entire equity interest of Chijin Laos as of December 31, 2017 by way of the asset
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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approach and the income approach. Pursuant to the share purchase agreement, 90% of the
consideration shall be paid as of the completion date of the transaction, and the remaining 10%
of the consideration shall be paid on the earlier of (i) December 31, 2021; and (ii) 14 days after
(x) LXML has ceased producing copper at the Sepon Gold and Copper Mine pursuant to the
method of production in place as of the date of the agreement; and (y) LXML has, since the
date of the agreement, poured gold from the Sepon Gold and Copper Mine totally in aggregate
not less than 1 kg of gold. The transaction was completed on November 30, 2018 with 90% of
the consideration paid on the same date, and the remaining 10% of the consideration was
settled on July 21, 2022.
Upon completion of the acquisition, LXML became an indirect subsidiary of our
Company principally engaged in the operation of our Sepon Gold and Copper Mine. For
details, see the section headed “Business — Our Gold Production Business in Laos” in this
Prospectus.
2. Acquisition of Golden Star Resources by way of a Plan of Arrangement
Pursuant to an arrangement agreement dated October 31, 2021 (the “ Arrangement
Agreement ”) entered into between our Company and Golden Star Resources as amended by an
amending agreement dated November 24, 2021 and an assignment and assumption agreement
dated December 21, 2021 and entered into by the parties below (collectively, the “ Amendment
Agreements ”), our Company through Chijin HK and its assignee Kefei Investment (BVI)
Limited (the “ Assignee ”), which is wholly owned by China-Africa Fund for Industrial
Cooperation Co., Ltd. (ப΂ʮ̡), agreed to acquire approximately
62% and 38% of the issued and outstanding common shares of Golden Star Resources, a
Canadian federally-incorporated company which was then listed on the NYSE American
(symbol: GSS), the Toronto Stock Exchange (symbol: GSC) and the Ghana Stock Exchange
(symbol: GSR), by way of a statutory plan of arrangement (the “ Plan of Arrangement ”) under
section 192 of the Canada Business Corporations Act for US$3.91 per share in cash,
representing a total transaction value of approximately US$470 million (meaning the total
consideration to be paid by our Company and the Assignee collectively) on a fully-diluted,
in-the-money basis. In view of the growth potential of the Wassa Gold Mine, the Assignee
expressed interest to acquire a minority interest in Golden Star Resources through the Plan of
Arrangement after our Company had entered into the Arrangement Agreement for all the issued
shares of Golden Star Resources and accordingly, the aforesaid parties entered into the
Amendment Agreements pursuant to which our Company assigned to the Assignee the
obligation to acquire 38% of such shares under the Plan of Arrangement. The consideration to
be paid by our Company (through Chijin HK) under the Plan of Arrangement amounted to
US$291 million, representing the consideration corresponding to the percentage of
shareholding interest acquired by our Company.
The consideration was determined after taking into account of, among others, the reserves
and resources of the Wassa Gold Mine operated by GSWL, a non-wholly owned subsidiary of
Golden Star Resources, the future extraction and development plan, the operating performance
of Golden Star Resources and the appraised value by an independent valuer of the entire equity
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interest of Golden Star Resources as of June 30, 2021 by way of the income approach.
Accordingly, the consideration per share of Golden Star Resources represents a 24.13%
premium over the closing price of the shares on the NYSE American as of October 29, 2021.
On November 22, 2021, the Ghanaian Ministry of Lands and Natural Resources issued a
no objection letter in relation to our Company becoming the controller of GSWL, via Chijin
HK and/or the Assignee. On November 25, 2021, the Ontario Superior Court of Justice
(Commercial List) (“ Ontario Court ”) granted an interim order to direct, among others, a
special meeting of shareholders of Golden Star Resources to be held on December 30, 2021 to
consider the Plan of Arrangement, upon which a special resolution in relation to the Plan of
Arrangement was duly passed at the shareholders’ meeting. The Ontario Court issued a final
order approving the Plan of Arrangement on January 7, 2022. The acquisition was completed
on January 30, 2022 upon receipt of the necessary PRC approvals and alongside with the
delisting approvals from the NYSE American, the Toronto Stock Exchange and the Ghana
Stock Exchange by January 29, 2022, the shares of Golden Star Resources had been delisted
from the NYSE American and the Toronto Stock Exchange on February 7, 2022 and from the
Ghana Stock Exchange on February 9, 2022.
The reasons for the delisting of Golden Star Resources include, among others, (i) to
permit our Company to make strategic decisions focused on long-term growth and benefits,
free from the pressure of market expectations and share price fluctuations of Golden Star
Resources as a publicly listed company; and (ii) whilst Golden Star Resources (including its
subsidiaries) holds a single mine asset, the administrative burden and costs and management
resources associated with maintaining the multiple listing status and compliance with the
regulatory requirements does not outweigh the benefits of such. The delisting allows greater
flexibility for our Company to manage Golden Star Resources’ business. Our Directors confirm
that, to the best of their knowledge having made all reasonable enquiries, during the period
when the shares of Golden Star Resources were listed on the NYSE American, the Toronto
Stock Exchange and the Ghana Stock Exchange, (i) Golden Star Resources and its directors (a)
had been compliant with the applicable laws and regulations in all material respects, and (b)
had not been subject to any investigations or disciplinary actions by any regulatory authority
nor breached the relevant rules governing the listing of Golden Star Resources in any material
respect; and (ii) there is no matter that needs to be brought to the attention of the investors and
the Hong Kong Stock Exchange.
Upon completion of the acquisition, GSWL became an indirect subsidiary of our
Company principally engaged in the operation of our Wassa Gold Mine. The acquisition is line
with our Company’s strategic positioning for quality overseas Mineral Resources and
integration into our Group’s operations. For further details of our Wassa Gold Mine and our
Ghana operations, see the section headed “Business — Our Gold Production Business in
Ghana” in this Prospectus.
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According to Rule 4.05A of the Hong Kong Listing Rules, the acquisition of Golden Star
Resources would have been classified at the date of application for our Listing as a major
transaction under Chapter 14 of the Hong Kong Listing Rules. For further details of the
financial performance of Golden Star Resources, please refer to the history financial
information of Golden Star Resources set out in Appendix IB to this Prospectus.
3. Acquisitions and disposal of Tietto Minerals
In line with our Company’s strategic positioning on investing in quality overseas Mineral
Resources operations, on September 9, 2022, Chijin HK entered into a share subscription
agreement with Tietto Minerals, a company then listed on the Australian Securities Exchange
(“ASX”) under the stock code TIE, pursuant to which Chijin HK subscribed for 85,000,000
shares of Tietto Minerals at the issue price of AUD0.58 per share, representing a total
consideration of AUD49.3 million. The per share issue price was determined based on the
20-day volume weighted average price of the shares of Tietto Minerals quoted on the ASX. The
consideration was settled and the acquisition was completed on September 21, 2022.
Further, on September 13, 2022, Chijin HK obtained a confirmation from the Inner
Mongolia Property Rights Exchange Center to purchase 25,190,076 shares of Tietto Minerals
through the listing-for sale process for a consideration of RMB50.7 million. The consideration
was settled and the acquisition was completed on January 7, 2023. Following the completion
of the above acquisitions, together with the 30,665,788 shares already held by Chijin HK, our
Group held 140,855,864 shares, accounting for 13.05% of the then shareholding interest in
Tietto Minerals.
Tietto Minerals is an Australian-headquartered gold miner operating the Abujar Gold
Mine in Côte d’Ivoire which commenced its commercial production on July 6, 2023. The
Abujar Gold Mine includes three contiguous exploration tenements, namely Middle, South, and
North. In October 2020, the Target received environmental approval and in December 2020 a
gold exploitation (mining) licence within the Abujar Middle tenement covering an area of
120.36 km
2.
The above acquisitions constituted an acquisition of business by our Group pursuant to
Rule 4.02A(1) of the Hong Kong Listing Rules as Tietto Minerals was, upon completion of the
above acquisitions and prior to being disposed of by our Group, accounted for as an associate
of our Group in accordance with the applicable accounting standards. Our Directors have
confirmed that none of the applicable percentage ratios as stipulated under the Hong Kong
Listing Rules in respect of the above acquisitions, on an aggregated basis, exceeds 25%.
Accordingly, the pre-acquisition financial information of Tietto Minerals is not required to be
disclosed in the Prospectus under Rule 4.05A of the Hong Kong Listing Rules.
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On October 30, 2023 (the “ Offer Announcement Date ”), Zhaojin Capital, which is an
indirect wholly owned subsidiary of Zhaojin Mining Industry Company Limited (a company
listed on the Main Board of the Hong Kong Stock Exchange (stock code: 1818)) (“ Zhaojin
Mining ”, an Independent Third Party), lodged a bidder statement to Tietto Minerals, pursuant
to which it made a conditional offer to acquire all the outstanding issued shares of Tietto
Minerals at an offer price of AUD0.58 per share (and subsequently increased to AUD0.68 per
share on April 15, 2024), representing a premium of approximately 36% and 60% to Tietto
Minerals’ last closing price on ASX prior to the Offer Announcement Date respectively, which,
based on the public disclosure of Zhaojin Mining, was determined with reference to (i) the
operating performance of Tietto Minerals; (ii) Tietto Minerals’ historical trading price and the
premia to trading price in recent comparable public takeover transactions; and (iii) Tietto
Minerals’ market capitalization of approximately AUD479 million as of October 27, 2023. Our
Group accepted Zhaojin Mining’s offer mainly taking into account of the circumstances
whereby our Group was holding a minority interest in Tietto Minerals, the offer represented an
opportunity for our Group to realize a favorable investment return for cash. This also accords
with our Group’s focus on the development and operation of majority-owned Mineral
Resources.
Upon resolution by the Board, Chijin HK accepted the above offer and transferred all the
140,855,864 shares of Tietto Minerals to Zhaojin Capital during the offer period at a total
consideration of AUD95.782 million by April 29, 2024. Upon completion of the transfer, our
Group no longer held any interest in Tietto Minerals. For the year ended December 31, 2022,
the investment loss to our Group attributable from Tietto Minerals amounted to RMB3.84
million. For the year ended December 31, 2023 and the nine months ended September 30, 2024,
the investment income contributed from Tietto Minerals to our Group amounted to
approximately RMB10.13 million and RMB7.35 million, respectively. The gain from disposal
of the investment in Tietto Minerals amounted to approximately RMB71.09 million.
The offer was completed on May 14, 2024 upon which Zhaojin Capital obtained 90.72%
of the voting rights in Tietto Minerals. Upon the commencement of exercise of the compulsory
acquisition rights against the remaining shares of Tietto Minerals on May 24, 2024, the shares
of Tietto Minerals ceased trading on the ASX on June 3, 2024 and Tietto Minerals was delisted
on June 6, 2024.
4. Acquisition of Xinhenghe Mining
As an expansion of our mineral gold reserves and domestic mining operations, on
December 30, 2022, our Company entered into an equity transfer agreement with Liu Xin ( ᄎ
ڦLi Y uanyuan ( ҽధధ), Wang Zhonghua (ശ) (an Independent Third Party), Y unnan
Y uanhao Mining Co., Ltd. (ʮ̡)( “ Yuanhao Mining ”, and together with
the above sellers, the “ Sellers ”) and Xinhenghe Mining, pursuant to which our Company
acquired an aggregate of 51% equity interest in Xinhenghe Mining from the Sellers at a total
consideration of RMB61.20 million, which was determined after arm’s length negotiation by
the parties taking into account of, among others, the estimate of the resources and the nature
and qualities of the minerals in the Jintai Gold Mine held by Jintai Mining, a direct non-wholly
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owned subsidiary of Xinhenghe Mining, the future extraction and development plan of the
mine and the estimated capital input in relation to the construction project and equipment
required for such. For details, please see the paragraph headed “— Our Principal Subsidiaries
— Jintai Mining” in this section and the section headed “Business — Our Gold Production
Business in China — Overview — Jintai Mining” in this Prospectus.
Immediately upon completion of the acquisition on January 4, 2023, Xinhenghe Mining
is held as to 51% equity interest by our Company, with the remaining 30%, 12% and 7% equity
interest held Liu Xin, Li Y uanyuan and Y uanhao Mining. Y uanhao Mining disposed of its 7%
equity interest in Xinhenghe Mining to Zhu Jiande (ᅃ), a director of our subsidiary Jintai
Mining, on July 1, 2024.
The financial information of Xinhenghe Mining since the completion of the acquisition
has been reflected in our consolidated financial statements for the Track Record Period. Our
Directors have confirmed that none of the applicable percentage ratios as stipulated under the
Hong Kong Listing Rules in respect of the acquisition of Xinhenghe Mining exceeds 25%.
Accordingly, the pre-acquisition financial information of Xinhenghe Mining is not required to
be disclosed in this Prospectus under Rule 4.05A of the Hong Kong Listing Rules.
POST-TRACK RECORD PERIOD ACQUISITION
In light of our overseas expansion and to facilitate our planning of rare earth exploration
in Laos, on March 4, 2024, China Investment (Property) Limited ( ʕ਷ҳ༟(ໄุ)ʮ̡)
(“China Investment ”) (as seller, and an Independent Third Party), China Investment Mining
(Laos) Sole Co., Ltd (“ Target Company ”), Chixia Laos (as purchaser) and Chijin Xiawu (as
guarantor) entered into an equity transfer agreement, pursuant to which Chixia Laos shall
acquire from China Investment 90% of the equity interest in the Target Company, which was
wholly owned by China Investment, at a total consideration of US$18,963,000.
The Target Company holds 86% equity interest in each of its two subsidiaries, namely
CIRE Mining and CIREX Mining, and the remaining 14% equity interest in each of CIRE
Mining and CIREX Mining is held by DDC Mining Sole Co., Ltd., an Independent Third Party.
The Target Company operates the Mengkham Rare Earth Element Project which is still at the
construction stage covering the mining area of 50 km
2, whereby the genetic type of the mineral
deposit belongs to the weathering crust ion-adsorbed rare earth deposit. CIRE Mining holds a
rare earth mineral processing permit (experimental) and a mineral extraction permit
(experimental). CIREX Mining holds a rare earth exploration permit.
Based on the accounts provided by the Target Company, the consolidated total assets of
the Target Company amounted to approximately KIP228,001,488,000 as of December 31, 2023
(being the most recent financial year of the Track Record Period of the Target Company). Its
consolidated net loss before (or after) tax for the two years ended December 31, 2023 was
approximately KIP86,757,701,000 and KIP94,724,614,000, respectively.
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The consideration for the proposed acquisition was determined after arm’s length
negotiations among the parties after taking into consideration, among others, the
aforementioned status of the rare earth project, the licences obtained by CIRE Mining and
CIREX Mining for the project, the future extraction and development plan of the project and
the appraised value by an independent valuer of the entire equity interest of the Target
Company as of December 31, 2023 by way of asset approach. The consideration shall be
satisfied by the internal resources of our Group. The Target Company will be accounted for as
a subsidiary of our Company upon completion of the proposed acquisition.
The rare earth project represents an opportunity for our Group to tap into the potential for
quality rare earth resources with a relatively higher economic value to be realised through the
medium-heavy rare earth ore held by the project. Our Directors are of the view that the
proposed acquisition is in our ordinary and usual course of business and on normal commercial
terms, and are fair and reasonable and in the interests of our Company and our Shareholders
as a whole. As of the Latest Practicable Date, our Company has obtained the approval from the
Xiamen Development and Reform Commission, and the parties to the transactions were
proceeding with the fulfillment of the other conditions of the transaction including changes of
the authorized representative of the Target Group. Accordingly, the proposed acquisition was
yet to have been completed.
We have applied to the Hong Kong Stock Exchange, and the Hong Kong Stock Exchange
has granted, a waiver from strict compliance with Rules 4.04(2) and 4.04(4)(a) of the Hong
Kong Listing Rules in relation to the above proposed acquisition. For more details, see the
section headed “Waivers from Strict Compliance with the Hong Kong Listing Rules — The
Post-Track Record Period Acquisition” in this Prospectus.
Save as disclosed above in this section, throughout the Track Record Period and as of the
Latest Practicable Date, we did not conduct any major acquisitions, disposals or mergers.
OUR PRINCIPAL SUBSIDIARIES
As of the Latest Practicable Date, we had a total of 10 principal subsidiaries. The
following table sets forth the detailed information of these principal subsidiaries as of the
Latest Practicable Date:
Names of major subsidiaries
Place of
incorporation/
establishment
Date of
incorporation/
establishment
Effective
equity interest
attributable to
our Company
Issued
share capital/
registered capital/
committed capital
Principal
activities
Jilong Mining /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118PRC October 24,
2005
100% RMB175,000,000 Gold mining and
processing
Huatai Mining /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118PRC January 8,
2005
100% RMB20,000,000 Gold mining and
processing
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Names of major subsidiaries
Place of
incorporation/
establishment
Date of
incorporation/
establishment
Effective
equity interest
attributable to
our Company
Issued
share capital/
registered capital/
committed capital
Principal
activities
Wulong Mining /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118PRC April 8, 2008 100% RMB40,000,000 Gold mining and
processing
Guangyuan Technology /H1118/H1118/H1118/H1118PRC August 6, 2003 55% RMB44,776,000 Disassembly of
waste electronic
products and
electrical
appliances
Jintai Mining /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118PRC February 20,
2008
46% RMB41,710,000 Gold mining
LXML /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Laos September 30,
1993
90% USD169,001,980 Gold and non-
ferrous metal
mining and
processing
Hanfeng Mining /H1118/H1118/H1118/H1118/H1118/H1118/H1118PRC September 24,
2004
100% RMB429,200,000 Non-ferrous metal
mining and
processing
Chijin Fengyu /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118PRC March 25,
2021
100% RMB100,000,000 Import and export of
trade, goods or
technology
GSWL /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Ghana November 22,
2001
56% USD1,000,000 Gold mining and
sales
Chijin Xiawu /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118PRC October 18,
2022
51% RMB400,000,000 Non-ferrous metal
sales
For further information of our Company’s subsidiaries, please refer to the paragraph
headed “— Corporate Structure” in this section below and Note 1 to the Accountants’ Report
set out in Appendix IA to this Prospectus.
Jilong Mining
Jilong Mining was established under the laws of the PRC with limited liability on October
24, 2005 with an initial registered capital of RMB20 million, for which the late Mr. Zhao and
two Independent Third Party individuals held 51%, 29% and 20% of the equity interest in
Jilong Mining, respectively.
Following various rounds of equity interest transfer and capital increase, as of April 25,
2011, the registered capital of Jilong Mining was increased to RMB75 million with (i) the late
Mr. Zhao held 57.75% equity interest; (ii) each of Zhao Guixiang and Zhao Guiyuan holding
10.00% equity interest; (iii) each of Liu Y ongfeng (ࢤRen Yiguo ( ΂່਷), Ma Li ( ৵ɢ)
and Li Xiaohui ( ҽወሾ) holding 5.00% equity interest; and (iv) Meng Qingguo holding 2.25%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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equity interest. To the best knowledge of our Directors having been all reasonable enquiries,
save for the late Mr. Zhao, Zhao Guixiang and Zhao Guiyuan, all other equity interest holders
of Jilong Mining were Independent Third Parties.
On February 23, 2012, our Company entered into a restructuring framework agreement
with Mr. Wu and the above equity interest holders of Jilong Mining, pursuant to which, among
others, the latter agreed to sell their entire equity interest in Jilong Mining to our Company in
consideration of our Company issuing an aggregate of 183,664,500 Shares to them at the issue
price of RMB8.68 per Share. See the paragraph headed “— Major Changes in Shareholding and
Share Capital of our Company — 4. Change of controlling shareholder in April 2010 and Major
Assets Restructuring in November 2012” in this section for details. Jilong Mining became our
wholly owned subsidiary upon completion of the Major Assets Restructuring on November 28,
2012.
Upon resolutions at the general meeting of Jilong Mining on August 14, 2017, the
registered capital of Jilong Mining was increased to RMB175 million on August 30, 2017.
Subsequently, upon resolutions at the general meeting of Jilong Mining on January 29, 2019,
our Company entered into an equity transfer agreement with Inner Mongolia Financial Assets
Management Company Limited (ʮ̡)( “ IM Financial Asset
Management ”) on January 30, 2019, pursuant to which our Company transferred 45% equity
interest in Jilong Mining to IM Financial Asset Management at a consideration of RMB300
million, which was determined after arm’s length negotiation between the parties taking into
account of the corresponding interest of the net asset value of Jilong Mining. Upon completion
of the equity transfer on the same date, Jilong Mining is held as to 55% and 45% of the equity
interests by our Company and IM Financial Asset Management, respectively.
Our Company entered into two equity transfer agreements with IM Financial Asset
Management on April 23, 2020 and September 21, 2020, pursuant to which our Company
repurchased 30% and 15% equity interest from IM Financial Asset Management at a
consideration of RMB200 million and RMB100 million, respectively. Upon resolutions at the
general meetings of Jilong Mining on April 24, 2020 and September 21, 2020, the equity
transfers were completed on April 27, 2020 and September 9, 2020, respectively, and up to the
Latest Practicable Date, Jilong Mining was a wholly owned subsidiary of our Company.
For details of our operations in Jilong Mining, see the section headed “Business — Our Gold
Production Business in China — Jilong Mining” in this Prospectus.
Huatai Mining
Huatai Mining was established under the laws of the PRC with limited liability on January
8, 2005 with an initial registered capital of RMB20 million by way of asset injection with the
late Mr. Zhao and Zhao Guixiang holding approximately 90% and 10% of the equity interest
in Huatai Mining, respectively.
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Upon resolution at the general meeting of Huatai Mining on December 2, 2010, the late
Mr. Zhao and Zhao Guixiang entered into an equity transfer agreement with Jilong Mining on
December 8, 2010, pursuant to which Jilong Mining acquired from the late Mr. Zhao and Zhao
Guixiang 90% and 10% of the equity interest in Huatai Mining at a total consideration of
RMB50 million, with reference to, among others, the resources of the Huatai Gold Mine, the
historical operating performance and the future extraction and development plan of Huatai
Mining. Upon completion of the said transfers on December 10, 2010 and up to the Latest
Practicable Date, Huatai Mining was a wholly owned subsidiary of our Company. For details
of our operations in Huatai Mining, see the section headed “Business — Our Gold Production
Business in China — Huatai Mining” in this Prospectus.
Wulong Mining
Wulong Mining was established under the laws of the PRC with limited liability on April
8, 2008 with a registered capital of RMB40 million. Zhongjin Gold Corp., Ltd. (ٰږ
ʮ̡, a company listed on the Shanghai Stock Exchange (stock code: 600489), and an
Independent Third Party) (“ Zhongjin Gold ”) was the sole equity interest holder of Wulong
Mining upon establishment.
On January 22, 2010, Zhongjin Gold entered into a property right transfer agreement ( ପ
ΥΝ) with Tangshan Zhonghe Industrial Group Company Limited (ʆʕձྼุණྠ
ʮ̡)( “ Tangshan Zhonghe ”), an Independent Third Party, pursuant to which Zhongjin
Gold transferred the entire equity interest in Wulong Mining to Tangshan Zhonghe at a
consideration of RMB352,691,800. Upon completion of the transfer on March 2, 2010,
Tangshan Zhonghe was the sole owner of the equity interest in Wulong Mining.
On April 25, 2013, Jilong Mining entered into an equity transfer agreement with Tangshan
Zhonghe, pursuant to which Jilong Mining acquired the entire equity interest in Wulong
Mining from Tangshan Zhonghe at a consideration of RMB625,959,200, which was determined
after arm’s length negotiation between the parties taking into account of, among others, the
historical performance, the resource potential and the future development plan of Wulong
Mining and the appraised value by an independent valuer of the entire equity interest of
Wulong Mining as of March 31, 2013 by way of asset approach. Upon completion of the
transfer on November 11, 2013 and up to the Latest Practicable Date, Wulong Mining was a
wholly owned subsidiary of our Company. For details of our operations in Wulong Mining, see
the section headed “Business — Our Gold Production Business in China — Wulong Gold
Mine” in this Prospectus.
Guangyuan Technology
Guangyuan Technology was established under the laws of the PRC with limited liability
on August 6, 2003 with an initial registered capital of RMB1.38 million. Upon establishment,
Guangyuan Technology was owned as to 71.00%, 14.50% and 14.50% equity interest by Lu
Hong ( ኁ̾), Cheng Xi ( ೻ᘙ) and Zhao Xiaoyan ( Ⴛʃዲ), all being Independent Third
Parties.
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Upon various equity interest transfers and capital increase, the registered capital of
Guangyuan Technology increased to RMB30 million on June 5, 2014 with Liang Xioayan ( ૑
ወዲ) and Lu Hong holding 95% and 5% equity interest in Guangyuan Technology,
respectively.
On July 1, 2015, our Company entered into an equity transfer and capital increase
agreement with Liang Xiaoyan and Lu Hong, pursuant to which our Company paid RMB38
million and RMB2 million to Liang Xiaoyan and Lu Hong, respectively, and injected RMB60
million into the registered capital of Guangyuan Technology within which approximately
RMB14.776 million was paid as the paid-up capital, and the remaining RMB45.224 million
was converted into capital reserve. The consideration was determined upon arm’s length
negotiations among the parties after taking into account, among others, the historical
performance, expected capital needs and future prospect of Guangyuan Technology and the
appraised value by an independent valuer of the entire equity interest of Guangyuan
Technology as of April 30, 2015 by way of income approach. Upon completion of the said
transfer and capital increase on July 23, 2015, the registered capital of Guangyuan Technology
was increased to RMB44,776,000 with our Company, Liang Xiaoyan and Lu Hong holding
55.00%, 42.75% and 2.25% equity interest in Guangyuan Technology, respectively. Since then
and up to the Latest Practicable Date, Guangyuan Technology was a non-wholly owned
subsidiary of our Company. For details of our operations in Guangyuan Technology, see the
section headed “Business — Our Other Business — Operations of Resource Recycling
Business” in this Prospectus.
Jintai Mining
Jintai Mining was established under the laws of the PRC with limited liability on
February 20, 2008 with a registered share capital of RMB5 million. Upon establishment, Jintai
Mining was held as to 70% and 30% of the equity interest by Shanghai Fuduo Mining
Exploration Technology Company Limited (ʮ̡, and currently
known as Y unnan Fudo Mining Exploration Technology Company Limited (ూεᘤุਖઞ
ʮ̡)) (“ Fuduo Exploration ”) and Dali Geology and Mining Drawing and Printing
Company Limited (ப΂ʮ̡)( “ Dali Geology ”), respectively, both
being Independent Third Parties.
Upon resolution at the general meeting of Jintai Mining on January 25, 2011, Dali
Geology and Y unnan Shengyuan Mining Development Company Limited (ᘤุක೯
ʮ̡)( “Yunnan Shengyuan ”), an Independent Third Party, entered into an equity transfer
agreement on March 31, 2011, pursuant to which Dadi Geology transferred 30% equity interest
in Jintai Mining to Y unnan Shengyuan at a consideration of RMB1.5 million. Upon completion
of the transfer on May 17, 2011, Jintai Mining was held as to 70% and 30% of the equity
interest by Foduo Exploration and Y unnan Shengyuan.
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Upon resolution at the general meeting of Jintai Mining on September 26, 2018, the
registered capital was increased to RMB41.71 million pursuant to which certain debts in the
amount of RMB36.71 million owed by Y unnan Shengyuan to Jintai Mining was converted into
equity and recognised as the capital contribution by Y unnan Shengyuan into Jintai Gold Mine.
Upon completion of the debt-to-equity conversion on the same date, the registered capital of
Jintai Mining was increased to RMB41.71 million with Y unnan Shengyuan and Fuduo
Exploration holding as to approximately 91.61% and 8.39% equity interest, respectively.
Further, upon resolution at the general meeting of Jintai Mining on February 1, 2021,
Xinhenghe Mining entered into an equity transfer agreement with Y unnan Shengyuan on the
same date, pursuant to which Xinhenghe Mining acquired 90% of the equity interest in Jintai
Mining at a consideration of RMB38.28 million which was determined after arm’s length
negotiation between the parties taking into account of, among others, the proportion of the
registered capital of Jintai Mining. Upon completion of the acquisition on the same date, Jintai
Mining was held as to approximately 90%, 8.39% and 1.61% equity interest by Xinhenghe
Mining, Fuduo Exploration and Y unnan Shengyuan, respectively. Accordingly, Xinhenghe
Mining and Jintai Mining became our Company’s subsidiaries. For details of our operations in
Jintai Mining, see the section headed “Business — Our Gold Production Business in China —
Jintai Gold Mine “in this Prospectus.
LXML
LXML was established under the laws of Lao PDR as a limited company on September
30, 1993 with an initial registered capital of USD5 million pursuant to the Mineral Exploration
and Production Agreement (the “ MEPA”) entered into between the Government of Lao PDR
and CRA Exploration (Laos) Limited, an Independent Third Party, on June 15, 1993. Following
various capital increases and equity interests, and upon the exercise its option under MEPA (as
amended), the Government of Lao PDR (represented by the Ministry of Finance) held 10%
equity interest in LXML, with the remaining 90% equity interest held by Chijin Laos (which
was then held by an Independent Third Party), by June 30, 2007. Subsequently, the registered
capital of LXML increased to USD169,001,980 as certified by the Ministry of Planning and
Investment of Lao PDR and reflected in the amended Investment License (3rd Amendment)
No. 025-2021/MPI.IV4 dated 21 July 2021.
LXML became a subsidiary of our Company since completion of the acquisition of Chijin
Laos on November 30, 2018 and up to the Latest Practicable Date. For details, see the
paragraph headed “Major Acquisitions and Disposals — 1. Acquisition of LXML through
Chijin Laos” in this section. For details of our operations in LXML, see the section headed
“Business — Our Gold Production Business in Laos” in this Prospectus.
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Hanfeng Mining
Hanfeng Mining was established under the laws of the PRC with limited liability on
September 24, 2004 with an initial registered capital of RMB10 million. Upon establishment,
Hanfeng Mining was held as to 90%, 5% and 5% of the equity interest by the late Mr. Zhao,
Zhao Guixiang and Zhao Guiyuan, respectively.
Upon resolutions at the general meeting of Hanfeng Mining on December 1, 2010, the late
Mr. Zhao entered into an equity transfer agreement with Jilong Mining on December 2, 2010,
pursuant to which the late Mr. Zhao (for himself and on behalf of the other shareholders)
disposed of the entire equity interest to Jilong Mining at a consideration of RMB25 million.
Upon completion of the transfer on December 6, 2010, Jilong Mining held the entire equity
interest in Hanfeng Mining.
The general meeting of Hanfeng Mining resolved on December 26, 2011 to transfer the
entire equity interest in Hanfeng Mining to the equity interest holder of Jilong Mining in
proportion to their equity interest in Jilong Mining. On the same date, the late Mr. Zhao (for
himself and on behalf of the other shareholders of Jilong Mining) entered into an equity
transfer agreement to effect the above transfer at a total consideration of RMB25 million,
which was determined with reference to the acquisition price paid by Jilong Mining in
December 2010. Upon completion of the aforesaid transfer as of December 30, 2011. Hanfeng
Mining was held as to (i) 57.75% equity interest by the late Mr. Zhao; (ii) 10.00% equity
interest by each of Zhao Guixiang and Zhao Guiyuan; (iii) 5.00% equity interest by each of Liu
Y ongfeng, Ren Yiguo, Ma Li and Li Xiaohui; and (iv) 2.25% equity interest by Meng Qingguo.
In preparation for the quotation on the NEEQ, Hanfeng Mining was converted from a
company with limited liability to a joint stock company on December 26, 2014. Upon
conversion, Hanfeng Mining had a registered capital of RMB10,000,000 comprising
10,000,000 shares with a nominal value of RMB1 each, which were subscribed by all the then
shareholders in proportion to their respective equity interests in Hanfeng Mining immediately
prior to such conversion. Hanfeng Mining became quoted on the NEEQ on August 4, 2015
under the stock code: 833180.
Upon resolution at the general meeting of Hanfeng Mining on November 17, 2015,
Hanfeng Mining increased its registered share capital to RMB100 million pursuant to bonus
issue on the basis of nine new shares for every existing share held by the above shareholders
by way of conversion of capital reserve, which was completed on December 3, 2015. Further,
the general meeting of Hanfeng Mining resolved to issue 39,200,000 shares at an issue price
of RMB1.02 per share, amounting to a total consideration of RMB39,984,000 on a pro rata
basis to existing shareholders. Upon completion of the share issuance on March 8, 2016, the
share capital of Hanfeng Mining was increased to RMB139.20 million.
On February 25, 2019, having considered that the trading activity, equity liquidity, the
future business strategy and costs of maintaining the listing status on the NEEQ, Hanfeng
Mining voluntarily ceased to be quoted on the NEEQ. Upon resolutions at the general meeting
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on March 12, 2019, Hanfeng Mining was converted into a private limited liability company.
Further, the general meeting of Hanfeng Mining resolved on March 14, 2019 resolved to
approve the transfer of the equity interest held by Zhao Guixiang, Zhao Guiyuan, Ren Yiguo,
Liu Y ongfeng, Ma Li and Li Xiaohui in Hanfeng Mining to Hanfeng Zhongxing at total
consideration of RMB204 million, which was determined with reference to the appraised value
by an independent valuer of the entire equity interest of Hanfeng Mining as of December 31,
2018 by way of the asset approach and the income approach. Upon completion of the transfer,
Hanfeng Mining was held as to 57.75%, 40.00% and 2.25% equity interest by the late Mr.
Zhao, Hanfeng Zhongxing and Meng Qingguo, respectively.
Our Directors confirm that during the period when the shares of Hanfeng Mining were
quoted on the NEEQ, (i) Hanfeng Mining had been in compliance with all applicable laws and
regulations as well as rules and regulations of the NEEQ in all material respects; (ii) Hanfeng
Mining had not been subject to any disciplinary action by the relevant regulators or any
material litigation in this respect; (iii) the directors and supervisors of Hanfeng Mining had not
been subject to any administrative penalty by the NEEQ or the CSRC; and (iv) there are no
other issues that need to be brought to the attention of our Shareholders, potential investors or
the Hong Kong Stock Exchange.
Our Company entered into an acquisition agreement with the then shareholders of
Hanfeng Mining on November 5, 2019, pursuant to which, among others, our Company agreed
to acquire the entire equity interest in Hanfeng Mining at a consideration of RMB510 million.
See the paragraph headed “— Major Changes in Shareholding and Share Capital of our
Company — 6. Capital increase in October 2017 and acquisition of Hanfeng Mining by way
of non-public issuance of A Shares in January 2020” in this section for details. Upon the
completion of the acquisition on November 7, 2019 and up to the Latest Practicable Date,
Hanfeng Mining was a wholly owned subsidiary of our Company.
Pursuant to the resolutions at the general meeting of Hanfeng Mining on February 21,
2020, the registered capital was further increased to RMB429.20 million on the same date. For
details of our operations in Hanfeng Mining, see the section headed “Business — Our Other
Mineral Resources Production Business — Our Other Mineral Resources Production Business
in China” in this Prospectus.
Chijin Fengyu
Chijin Fengyu was established under the laws of the PRC with limited liability on March
25, 2021 with an initial registered capital of RMB100,000,000. Since the date of its
establishment and up to the Latest Practicable Date, Chijin Fengyu was wholly owned by our
Company. Chijin Fengyu is principally engaged in the procurement of supplies in the PRC for
our overseas operations.
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GSWL
GSWL was established under the laws of Ghana as a private limited liability company
with an authorized share capital of 10,000,000 equity shares with a par value of 0.305 pesewas
on November 22, 2001. Upon establishment, 90% and 10% of the equity interest in GSWL
were held by Satellite Goldfields Limited, an Independent Third Party and the Ghana
Government, respectively. In 2002, Satellite Goldfields transferred its entire equity interest in
GSWL to Wasford Holdings, which, together with GSWL, became our non-wholly owned
subsidiaries upon completion of the acquisition of Golden Star Resources. For details, see the
paragraph headed “— Major Acquisitions and Disposals — 2. Acquisition of Golden Star
Resources by way of a Plan of Arrangement” in this section.
Upon shareholders’ resolutions passed on December 21, 2023, the issued share capital of
GSWL increased from US$756 to US$1,000,000 and the authorised shares of GSWL increased
from 10,000,000 shares to 500,000,000 shares. For details of our operations in GSWL, see the
section headed “Business — Our Gold Production Business in Ghana” in this Prospectus.
Chijin Xiawu
Chijin Xiawu was established under the laws of PRC with limited liability on October 18,
2022 with a registered capital of RMB60,000,000, of which RMB30,600,000 was contributed
by our Company and the remaining RMB29,400,000 was contributed by Xiamen Tungsten.
Upon establishment, Chijin Xiawu was held as to 51% and 49% of the equity interest by our
Company and Xiamen Tungsten, respectively.
At the general meeting of Chijin Xiawu on January 8, 2024, our Company and Xiamen
Tungsten resolved to increase the registered capital of Chijin Xiawu to RMB400 million by
way of a pro rata capital injection. The percentage of equity interest held by our Company and
Xiamen Tungsten remained unchanged.
Since its establishment and up to the Latest Practicable Date, Chijin Xiawu was a
non-wholly owned subsidiary of our Company. For details of our operations in Chijin Xiawu,
see the section headed “Business — Our Rare Earth Business in Laos” in this Prospectus.
COMPLIANCE WITH LA WS AND REGULATIONS
All of the above capital increases, equity transfers, acquisitions and disposals of our
Company and our subsidiaries are effective, legally completed, duly settled and in compliance
with the applicable PRC, Laos and Ghana laws and regulations, and all permits, authorizations,
approvals and consents necessary for the above transactions have been obtained from the
relevant government and regulatory authorities of the PRC, Laos and Ghana.
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DEREGISTRATION OF A SUBSIDIARY
To optimize our management and other resources and to focus on our core business, we
commenced voluntary deregistration of Chijin Geoexploration by way of a resolution at the
general meeting. Chijin Geoexploration is principally engaged in the technology consultation
for exploration of Mineral Resources in the PRC. The voluntary deregistration was carried out
in light of the lower level of business activities taken up and the net loss suffered by Chijin
Geoexploration in previous years. The total assets of Chijin Geoexploration amounted to
approximately RMB0.65 million, RMB0.34 million, RMB0.30 million and RMB0.30 million
as of December 31, 2021, 2022 and 2023 and September 30, 2024, respectively. The revenue
of Chijin Geoexploration amounted to approximately RMB0.62 million, RMB0.10 million, nil
and nil for the three years ended December 31, 2023 and the nine months ended September 30,
2024, respectively. Chijin Geoexploration recorded net loss before/after tax of approximately
RMB0.39 million and RMB0.33 million for the two years ended December 31, 2022 and net
profit before/after tax of approximately RMB0.33 million for the year ended December 31,
2023. Nil net profit or loss before/after tax was recorded for the nine months ended September
30, 2024.
On April 1, 2024, Chijin Geoexploration established the liquidation committee to
liquidate the remaining assets of Chijin Geoexploration, and such was filed with the PRC
(Tianjin) Pilot Free Trade Zone Market Supervision Administration ( ʕ਷(ݵ)༊᜕
ਜ̹ఙ္ຖ၍ଣ҅). Accordingly, the deregistration was completed on January 3, 2025 and
ceased to be a subsidiary of our Company.
As confirmed by our Directors, Chijin Geoexploration had not been involved in any
material claims, litigations or non-compliant incidents since its establishment and up to the
Latest Practicable Date. Chijin Geoexploration was solvent prior to the commencement of the
voluntary deregistration. In addition, in light of the relatively insignificant business operations
of Chijin Geoexploration, our Directors consider that its deregistration did not have a material
impact on our Group’s business and financial performance.
PREVIOUS LISTING ATTEMPT
On October 29, 2022 and November 14, 2022, resolutions were passed by our Board and
the general meeting of our Company, respectively, to prepare for our Company’s potential
application for listing of global depositary receipts (“ GDR Listing ”) representing our A Shares
on the SIX Swiss Exchange Ltd. (“ SIX”) (the “ GDR Listing Application ”).
During the process of preparing for the GDR Listing Application, taking into account of
the changes in the domestic and foreign stock market conditions and the regulatory
requirements, as well as a holistic review of the capital needs and long-term development needs
of our Group, we determined that an application for listing on the Hong Kong Stock Exchange,
considering, among others, its international recognition and reputation and diversified
fund-raising channels provided by the Hong Kong capital market, may better suit our needs.
Our Board resolved to cease the GDR Listing Application on August 19, 2023.
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Our Directors confirm that as of the Latest Practicable Date, no application had been filed
with SIX in relation to the GDR Listing. To the best of our Directors’ knowledge, our Directors
are not aware of (i) any enquiries from the CSRC or SIX in relation to GDR Listing
Application; (ii) any other matters relating to the GDR Listing Application which may have
implications on our Company’s suitability for listing on the Hong Kong Stock Exchange; or
(iii) any other matters which need to be brought to the attention of the Hong Kong Stock
Exchange and the investors in relation to the GDR Listing Application.
REASONS FOR LISTING ON THE HONG KONG STOCK EXCHANGE
Our Company is seeking a listing on the Hong Kong Stock Exchange in order to raise
further capital for the development and expansion of our Company’s business, and to further
raise our profile as a business with a global presence and thus, enhance our ability to attract
new customers, business partners, strategic investors and key management personnel. See also
the section headed “Future Plans and Use of Proceeds” in this Prospectus for further details.
PUBLIC FLOAT
The aggregate of 241,925,746 A Shares collectively held by Ms. Li and Hanfeng
Zhongxing will not be considered as part of our public float as (i) Hanfeng Zhongxing’s
acquisition of securities has been financed by Ms. Li, the sole limited partner of Hanfeng
Zhongxing; and (ii) they comprise the Single Largest Shareholder Group constituting a core
connected person of our Company.
Further, as of the Latest Practicable Date, our Directors and senior management members
held an aggregate of 74,729,571 A Shares, among which (i) our executive Directors, namely
Mr. Wang Jianhua, Ms. Y ang Yi-fang, Mr. Lyu Xiaozhao and Mr. Gao Bo held 74,200,071,
113,000, 111,700 and 153,500 A Shares, respectively; and (ii) our senior management
members, namely Mr. Zhou Xinbin, who is our Vice President and a director of Chijin HK and
LXML, and Mr. Dong Shubao, who is our Board Secretary and a director of Chijin Xiawu, held
112,800 and 38,500 A Shares, respectively. Meanwhile, Mr. Zhao Qiang ( Ⴛ੶), a director of
Chijin Xiawu, held 204,000 A Shares. As the aforesaid comprise directors of our Company and
our subsidiaries, they constitute core connected persons of our Company. Those A Shares held
by the above Directors and senior management members as well as Mr. Zhao will not be
considered as part of our public float.
In respect of the A Shares held under the ESOPs, as the Phase I ESOP was managed by
the Phase I ESOP management committee (which exercises the shareholder rights with respect
to the A Shares held under the Phase I ESOP) comprising Mr. Zhou Xinbin, Mr. Dong Shubao
and Mr. Zhao Qiang, who are the directors of various subsidiaries of our Group, the 10,000 A
Shares held under the Phase I ESOP were regarded as being controlled by the core connected
persons of our Company, and therefore they will not be considered as part of our public float.
Nevertheless, as further described in the paragraph headed “C. Further Information about our
Directors, Supervisors and Substantial Shareholders — 4. Employee Stock Ownership Plans”
in Appendix VII to this Prospectus, the majority members of the Phase III ESOP management
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committee (which exercises the shareholder rights with respect to the A Shares to be held under
the Phase III ESOP) are not core connected persons of our Company. The 15,182,600 A Shares
to be held under the Phase III ESOP are thus not regarded as being held, managed or controlled
by our Company’s core connected persons. Meanwhile, the significant majority of the
participants under the Phase III ESOP are not core connected persons, and the proportion of
Shares attributable to the subscription monies of these participants also remains in large
majority. Accordingly, those A Shares held under the Phase III ESOP will be regarded as part
of the public float of our Company.
Therefore, save for an aggregate of 316,869,317 A Shares held by the Single Largest
Shareholder Group, our executive Directors, certain of our senior management members who
are also directors of our Group’s various subsidiaries, Mr. Zhao and those held under the Phase
I ESOP as mentioned above, to the best of our Directors’ knowledge having made reasonable
enquiries, the remaining 1,347,042,061 A Shares, as well as the H Shares to be issued pursuant
to the Global Offering, will be counted towards the public float as such Shareholders are not
core connected persons of our Company upon the Listing nor accustomed to take instructions
from our Company’s core connected persons in relation to the acquisition, disposal, voting or
other disposition of their Shares and their acquisition of Shares were not financed directly or
indirectly by our Company’s core connected persons.
Immediately following completion of the Global Offering, assuming that (i) 205,652,000
H Shares are allotted and issued in the Global Offering; and (ii) the Offer Size Adjustment
Option and the Over-allotment Option are not exercised, our Company will have 1,869,563,378
issued Shares upon completion of the Global Offering, and based on the minimum Offer Price
of HK$13.72 per H Share, the total number of Shares held by the public (on all regulated
market(s) including the Hong Kong Stock Exchange) represents approximately 72.05% of our
total issued Shares upon Listing, whilst the H Shares to be issued upon the Global Offering
accounts for 11.00% of our Company’s total number of issued Shares, having an expected
minimum market capitalization of approximately HK$2.82 billion.
We have applied to the Hong Kong Stock Exchange for, and the Hong Kong Stock
Exchange has granted, a waiver from strict compliance with the requirements under Rule
8.08(1)(b) (as amended by Rule 19A.13A) of the Hong Kong Listing Rules that the minimum
percentage of the H Shares of our Company to be held by the public from time to time shall
be the higher of (a) 11% (assuming no exercise of the Offer Size Adjustment Option and the
Over-allotment Option) and (b) such percentage of H Shares to be held by the public
immediately after completion of the Global Offering, as increased by the H Shares to be issued
upon any exercise of the Offer Size Adjustment Option and the Over-allotment Option, of the
total enlarged issued share capital of the Company. For details of the relevant waiver, please
refer to the section headed “Waivers from Strict Compliance with the Hong Kong Listing Rules
and Exemption from Strict Compliance with the Companies (Winding Up and Miscellaneous
Provisions) Ordinance — Waiver in Respect of Public Float Requirements” in this Prospectus.
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OUR STRUCTURE IMMEDIATELY PRIOR TO THE GLOBAL OFFERING
The following chart sets forth a simplified corporate structure of our Group immediately
prior to the completion of the Global Offering.
Huatai Mining
(PRC)
Guangyuan
Technology(10)
(PRC)
100%100%100%100%55%100%51%
Chijin Xiawu(5)
(PRC)
51%
Xinhenghe
Mining(6)
(PRC)
90%
Jintai Mining(7)
(PRC)
Chijin HK
(Hong Kong)
Jilong Mining
(PRC)
Chijin Fengyu
(PRC)
Chijin Laos
(Cayman Islands)
Hanfeng Mining
(PRC)
62%
Golden Star
Resources(8)
(Canada)
100%
100%
100% 90%Caystar Holdings
(Cayman Islands)
Wasford Holdings
(Cayman Islands)
GSWL(9)
(Ghana)
90%
LXML(11)
(Laos)
100%
Wulong Mining
(PRC)
100%
Our Directors and
Senior Management(2)
11.44% 3.10%
4.49% 0.91%
Ms. Li(1) ESOPs(3)
80.06%
Other A Share
Shareholders(4)
Hanfeng
Zhongxing(1)
Chixia Laos
(Cayman Islands)
Our Company
(PRC)
Notes:
(1) As of the Latest Practicable Date, Ms. Li and Hanfeng Zhongxing directly held 190,410,595 and 51,515,151
A Shares, respectively. Meanwhile, Ms. Li and Mr. Wu Zengxiang are the sole limited partner and general
partner of Hanfeng Zhongxing accounting for approximately 99.00% and 1.00% of the committed capital
contribution of Hanfeng Zhongxing, respectively. The role of Mr. Wu is to represent Hanfeng Zhongxing in
external business and operational matters upon the authorization of Ms. Li in accordance with the limited
partnership agreement of Hanfeng Zhongxing. Mr. Wu does not, and cannot exercise control over Hanfeng
Zhongxing; and taking in account of the above, the majority interest held by Ms. Li enables her to exercise
de facto control of Hanfeng Zhongxing. Therefore, Mr. Wu has no control over the voting rights in share capital
of our Company held by Hanfeng Zhongxing, nor the control of Hanfeng Zhongxing in the exercise of such
voting rights. Those are rested solely with Ms. Li. Accordingly, Ms. Li and Hanfeng Zhongxing are regarded
as the Single Largest Shareholder Group of our Company. Please refer to the section headed “Relationship with
our Single Largest Shareholder Group — Our Single Largest Shareholder Group” in this Prospectus for details.
(2) These shares comprised of (i) Mr. Wang Jianhua, our Chairman of the Board and executive Director, holding
74,200,071 A Shares; (ii) Ms. Y ang Yi-fang, our executive Director and Chief Executive Officer, holding
113,000 A Shares; (iii) Mr. Lyu Xiaozhao, our executive Director, Vice President and Chief Engineer, holding
111,700 A Shares; (iv) Mr. Gao Bo, our executive Director and Vice President, holding 153,500 A Shares; (v)
Mr. Zhou Xinbing, our Vice President, holding 112,800 A Shares; and (vi) Mr. Dong Shubao, our Board
Secretary, holding 38,500 A Shares, accounting for an aggregate of 74,729,571 A Shares.
(3) As of the Latest Practicable Date, (i) 10,000 A Shares were held by the Phase I ESOP; (ii) the Phase II ESOP
had disposed of all the A Shares held by it; and (iii) 15,182,600 A Shares had been repurchased by the Company
for the purpose of the Phase III ESOP , accounting for an aggregate of 15,192,600 A Shares under the ESOPs.
Please refer to the paragraph headed “C. Further Information about our Directors, Supervisors and Substantial
Shareholders — 4. Employee Stock Ownership Plans” in Appendix VII to this Prospectus for details. The A
Shares held under the Phase I ESOP are not counted towards our public float as the exercise of the shareholder
rights pertaining to those A Shares is controlled by its own management committee comprising members who
are all core connected persons of our Company. Meanwhile, the A Shares held under the Phase III ESOP are
counted towards our public float as the exercise of the shareholder rights pertaining to those A Shares is
controlled by its own management committee comprising a majority of members who are not core connected
persons of our Company. For further details, see the paragraph headed “Public Float” in this section above.
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(4) Save for Mr. Zhao Qiang, a director of Chijin Xiawu, who held 204,000 A Shares as of the Latest Practicable
Date, to the best of our Directors’ knowledge having made reasonable enquiries, these A Share Shareholders
were not core connected persons of our Company.
(5) The remaining 49% of the equity interest in Chijin Xiawu was held by Xiamen Tungsten, a company listed on
the Shanghai Stock Exchange (stock code: 600549).
(6) The remaining 30%, 12% and 7% of the equity interest in Xinhenghe Mining was held by Liu Xin, Li Y uanyuan
and Zhu Jiande, respectively. See the paragraph headed “— Major Acquisitions and Disposals — 4. Acquisition
of Xinhenghe Mining” in this section for details.
(7) The remaining 8.39% and 1.61% of the equity interest in Jintai Mining was held by Fuduo Exploration and
Y unnan Shengyuan, respectively. Fuduo Exploration was held as to 88%, 7% and 5% equity interest by Chen
Hua ( ௓ശ), Y ang Chunbin (੸) and Bao Y oudi (ࢌrespectively, who are all Independent Third
Parties. Y unnan Shengyuan was wholly owned by Chen Hua. See the paragraph headed “— Our Principal
Subsidiaries — Jintai Mining” in this section for details.
(8) The remaining 38% of the equity interest in Golden Star Resources was held by Kefei Investment (BVI)
Limited, which was wholly owned by China-Africa Fund for Industrial Cooperation Co., Ltd. (“ CAFIC ”).
CAFIC was held as to (i) 80% of the equity interest by Wutongshu Investment Platform Company Limited ( ૙
ப΂ʮ̡)( “ Wutongshu Investment ”), which was wholly owned by the State
Administration of Foreign Exchange Central Foreign Exchange Business Center (̮ි၍ଣ҅ʕ̯̮ිุ
ਕʕː), an Independent Third Party; and (ii) 20% of the equity interest by the Export-Import Bank of China
(ʕ਷ආ̈ɹვБ), which in turn was owned as to 89.26% and 10.74% equity interest by Wutongshu
Investment and MOF, an Independent Third Party.
(9) The remaining 10% of the equity interest in GSWL is held by the Ghana Government.
(10) The remaining 42.75% and 2.25% of the equity interest in Guangyuan Technology were held by Liang Xiaoyan
and Lu Hong, respectively. See the paragraph headed “Our Principal Subsidiaries — Guangyuan Technology”
in this section for details.
(11) The remaining 10% of the equity interest in LXML was held by the Government of Lao PDF (represented by
the Ministry of Finance). See the paragraph headed “Our Principal Subsidiaries — LXML” in this section for
details.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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OUR STRUCTURE IMMEDIATELY FOLLOWING THE GLOBAL OFFERING
The following chart sets forth a simplified corporate structure of our Group immediately
after the Global Offering (assuming the Offer Size Adjustment Option and the Over-allotment
Option are not exercised).
Huatai Mining
(PRC)
Guangyuan
Technology(10)
(PRC)
100%100%100%100%55%100%51%
Our Company
(PRC)
Chijin Xiawu(5)
(PRC)
51%
Xinhenghe
Mining(6)
(PRC)
90%
Jintai Mining(7)
(PRC)
Chixia Laos
(Cayman Islands)
Chijin HK
(Hong Kong)
Jilong Mining
(PRC)
Chijin Fengyu
(PRC)
Chijin Laos
(Cayman Islands)
Hanfeng Mining
(PRC)
100% 62%
Golden Star
Resources(8)
(Canada)
100%
100% 90%Caystar Holdings
(Cayman Islands)
Wasford Holdings
(Cayman Islands)
GSWL(9)
(Ghana)
90%
LXML(11)
(Laos)
100%
Wulong Mining
(PRC)
100%
Our Directors and
Senior Management(2)
10.18% 2.76%
4.00% 0.81%
Ms. Li(1) ESOPs(3)
71.25%
Other A Share
Shareholders(4)
11.00%
Public H Share
Shareholders
Hanfeng
Zhongxing(1)
Notes:
(1) — (11) Please refer to the corresponding notes to the chart in “— Our Structure Immediately Prior to the Global
Offering” in this section.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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OVERVIEW
Who We Are
We are principally engaged in the mining, processing and sales of gold. Our operations
are centered in gold, and we work towards greater international development and expansion
through continuous technological advancements, maintaining cost-effective operations,
optimizing resource utilisation, and the acquisition of high-quality overseas resources.
As of the Latest Practicable Date, we owned and operated seven gold and polymetallic
mines across the world, including China, Southeast Asia, and West Africa. According to Frost
& Sullivan:
 we experienced the fastest growth among major gold producers in China. From 2021
to 2023, our gold production achieved a CAGR of 33.1%, which by far outpaced the
16.4% average growth rate of major gold producers in China;
 we ranked fifth among gold producers in China in terms of gold Resources, with
gold Resources of 12.5 million oz as of September 30, 2024, and we ranked fifth
among gold producers in China in terms of gold production, with gold production
of 461.5 koz in 2023;
 our operational efficiency enhancement surpassed the worldwide industry average
by a notable margin and we positioned lower in terms of AISC than that of the global
average. For the year ended December 31, 2023, our gold AISC stood at only
US$1,179.1 per ounce, placing us in the first quartile in the worldwide gold mining
industry, while the global average for the same period was approximately
US$1,348.5, which is 14.4% higher than ours. In 2023, we beat the global trend of
increased costs, as we reduced our gold AISC by 12.0%, whereas the average AISC
for international gold producers increased by 7.2% during the same period; and
 among gold producers in China, we had the greatest overseas presence in terms of
both total assets and revenue contribution derived from business activities outside of
the PRC as of December 31, 2023 and in 2023, respectively. In 2023, approximately
76.9% of our total gold production and 71.9% of our total revenue was generated
from our overseas business. As of September 30, 2024, our overseas assets
accounted for approximately 65.2% of our total assets.
Business Overview
We are principally engaged in the mining, processing, and sales of gold. We operate
multiple gold mines across the world and continuously aim to expand production and
exploration. Additionally, we are engaged both (i) in the mining, processing, and sales of other
Mineral Resources; and (ii) in the business of recycling waste electronic products and electrical
appliances, promoting comprehensive resource utilisation and circular economy.
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As of the Latest Practicable Date, we conducted our gold production business primarily
through six gold mines: (i) four mines in the PRC, namely the Jilong Gold Mine, Wulong Gold
Mine, Jintai Gold Mine and Huatai Gold Mine; (ii) one mine in Laos, namely the Sepon Gold
and Copper Mine, and (iii) one mine in Ghana, namely the Wassa Gold Mine. Furthermore, we
operate one polymetallic mine in Jilin Province, China, namely the Hanfeng Polymetallic
Mine, the principal products of which are zinc, lead, copper and molybdenum concentrate
powder. Also, we are planning to develop rare earth Resources in Laos. In addition to our
mining business, we have a resource recycling business, where we recycle waste electronic
products and electrical appliances.
In terms of our development strategies, our focus is on the gold mining business,
gradually divesting non-core assets and achieving significant growth. For example, in July
2020, we sold Chenzhou Xiongfeng for approximately RMB1.6 billion. Chenzhou Xiongfeng
was a non-core subsidiary which principally engaged in recycling of low-grade complex
materials, and rare and precious metals. The proceeds from that sale allowed us to continue
implementing our strategic focus on our gold business and improved our capital structure.
We actively seek to and have acquired suitable, high-quality domestic and overseas gold
assets to maintain our sustainable growth. Through acquisitions we have continuously
strengthened our Resources, Reserves and production capacity and expanded our global
presence:
 In November 2018, we acquired a 90% equity interest in LXML in Laos. According
to Frost & Sullivan, LXML held the largest copper-gold mine in Laos in terms of
gold Reserves by 2023. As of September 30, 2024, the Ore Reserves for Sepon Gold
and Copper Mine are about 7,896 thousand tonnes with an average Au grade of 3.11
g/t, of which 268 thousand tonnes are Proved Ore Reserves with an average Au
grade of 4.70 g/t, and 7,628 thousand tonnes are Probable Ore Reserves with an
average Au grade of 3.05 g/t.
 We have been collaborating with third parties to jointly conduct exploration projects
for multiple types of Mineral Resources in Laos. For example, (i) we entered into
a cooperative exploration agreement with Lao Mining Development State Enterprise
in July 2022. Lao Mining Development State Enterprise is a state-owned company
in Laos, affiliated with the Ministry of Energy and Mines. It owns multiple rights to
gold, copper, and rare earth mines, and it is primarily responsible for the
exploration, reservation, and cooperative development of Mineral Resources in
Laos; (ii) we formed a joint venture with Xiamen Tungsten Co., Ltd. (“ Xiamen
Tungsten ”) in September 2022 to obtain synergies and strengthen our respective
positions in rare earth Resource development in Laos.
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 In January 2022, we acquired a 62% equity interest in Golden Star Resources, which
holds a 90% equity interest in GSWL. As of September 30, 2024, the Ore Reserves
for Wassa Gold Mine are about 8,842 thousand tonnes with an average Au grade of
2.12 g/t, of which 3,521 thousand tonnes are Proved Ore Reserves with an average
Au grade of 2.14 g/t, 5,291 thousand tonnes are Probable Ore Reserves with an
average Au grade of 2.12 g/t, and 30 thousand tonnes are Stockpile Ore Reserves
with an average Au grade of 1.33 g/t.
 In January 2023, we acquired a 51% equity interest in Xinhenghe Mining, which
holds a 90% stake in Jintai Mining. As of September 30, 2024, the total gold
Resources of Jintai Gold Mine is 444 koz and its total gold Reserves were
approximately 33 koz in contained metals. The Mineral Resources for Jintai Gold
Mine are estimated to be about 10,666 thousand tonnes with an average Au grade of
1.30 g/t, including approximately 3,363 thousand tonnes of Measured Mineral
Resources with an average Au grade of 1.68 g/t, 4,604 thousand tonnes of Indicated
Mineral Resources with an average Au grade of 1.02 g/t, 2,699 thousand tonnes of
Inferred Mineral Resources with an average Au grade of 1.29 g/t. This acquisition
has further enhanced our mining operations and gold production.
Cost Control
We continue to research and develop applications of new technologies and have
implemented a series of cost reduction and efficiency enhancement measures such as
centralized procurement and optimization of the organizational and staff structures, with the
aim to continuously reduce production costs.
Through centralized procurement, we have realized substantial cost reduction benefits for
our domestic and overseas mines. We meticulously analyze procurement paths and implement
trial orders in increments. By selecting suppliers across the globe, including China, Thailand,
Vietnam, and other regions, we collaborate with cost-efficient suppliers, which refer to those
suppliers who we believe could achieve a balance between cost and benefit after thoroughly
considering factors such as tariffs in the region, delivery speed of the suppliers, quality
assurance period of the goods, repair costs, and stability of the supply source. Collaboration
with cost-efficient suppliers has introduced healthy competition among our suppliers, which
has encouraged other suppliers or potential suppliers to enhance their credentials and service
standards, hence have enhanced our bargaining position during procurement negotiations,
which has allowed us to mitigate against unfavorable terms in procurement contracts. In
addition, we have also broadened our supplier options and increased procurement activities in
low-cost regions, where the prices of the industrial products are relatively lower, such as PRC
and Vietnam, ultimately contributing to cost savings.
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We have utilized the specific circumstances of various mines to achieve targeted cost
reduction and efficiency enhancement. The Sepon Gold and Copper Mine continuously seeks
to improve its ore processing by adopting re-grinding techniques to enhance efficiency,
improve gold ore recovery rates, and decrease costs. As a result, its gold recovery rates
increased significantly from 54.6% in 2021 to 64.4% in the nine months ended September 30,
2024. The Wassa Gold Mine has improved its efficiency in excavation projects by involving
external contractors, leading to substantially lower unit costs and relatively high gold recovery
rates of 95.6%, 95.5% and 95.4% in 2022 and 2023 and in the nine months ended September
30, 2024, respectively.
Meanwhile, we have rigorously controlled capital expenditures, yielding significant cost
reductions. According to Frost & Sullivan, our operational efficiency enhancement surpassed
the worldwide industry average by a notable margin, and we placed significantly lower in terms
of gold AISC than that of the global average. As of December 31, 2023, our gold AISC stood
at only US$1,179.1 per ounce, placing us in the first quartile in the worldwide industry, while
the global average for the same period was approximately US$1,348.5, which is 14.4% higher
than ours. In 2023, we decreased our gold AISC by 12.0%, whereas the average AISC for
international gold producers increased by 7.2% during the same period. Set forth below is our
gold AISC and the global average for the periods indicated:
Y ear Ended
December 31,
Changes from
Y ear Ended
December 31,
2022 to Y ear
Ended
December 31,
2023
Nine Months
Ended
September 30,
20242022 2023
US$/ounce % US$/ounce
PRC Gold Mines /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,205.7 877.4 (27.2) 1,008.5
Sepon Gold and Copper Mine /H1118/H1118/H1118/H1118/H1118/H1118/H11181,476.9 1,330.0 (9.9) 1,408.3
Wassa Gold Mine /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,371.2 1,197.1 (12.7) 1,240.8
Our Group /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,340.0 1,179.1 (12) 1,249.2
Global Average /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,258.1 1,348.5 7.2 1,498.8
Note:
1. Company started to make voluntary disclosure of AISC since the year of 2022, in align with the global
industrial reporting practice.
The global average AISC has increased from US$1,348.5/ounce for the year ended
December 31, 2023 to US$1,498.8/ounce for the nine months ended September 30, 2024. This
was primarily due to the ongoing rise in labor costs globally. In addition, driven by the rising
gold price, gold mining companies started to process lower-grade ores which led to higher
mining costs.
The AISC of our Group increased from US$1,179.1/ounce for the year ended December
31, 2023 to US$1,249.2/ounce for the nine months ended September 30, 2024. This was mainly
because (i) the production volume of LXML for the third quarter of 2024 fell short of our
expectations due to the impact of typhoons and floods, resulting in an inability to spread labor
and depreciation costs; and (ii) labor costs and raw materials costs increased driven by global
inflation.
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Capacity Enhancement
We are committed to upgrading the mining and processing capacity of our existing mines
in order to achieve the growth of overall asset.
In terms of our overseas gold assets, we are accelerating the construction of the open-pit
and underground mining projects of the Sepon Gold and Copper Mine, which is expected to
increase the annual underground mining capacity to 806,000 tonnes by 2025 from the current
capacity of 536,000 tonnes. As of September 30, 2024, the Mineral Resources for Khanong are
estimated to be about 2,445 thousand tonnes with an average Au grade of 1.90 g/t, including
approximately 2,445 kt of Indicated Mineral Resources with an average Au grade of 1.9 g/t,
and 595 thousand tonnes of Inferred Mineral Resources with an average Au grade of 1.58 g/t.
Meanwhile, we are accelerating modelling and study work of exploration prospects of
Discovery West Deeps and Phavat North with open-pit and underground mining potentials, the
annual underground mining capacity is expected to be increased further after 2026 and 2027.
As of September 30, 2024, the Inferred Mineral Resources for Discovery West Deeps are
estimated to be about 1,165 thousand tonnes with an average Au grade of 5.68 g/t. This effort
also includes the re-evaluation of historical open pits at higher gold prices.
We expect to build the Wassa Gold Mine of into a large-scale gold mine with (i) an annual
processing capacity of approximately 3.3 million tonnes and (ii) an annual production of
200-250 koz gold leading up to 2028. Furthermore, the focus and effort will extend to increase
annual gold production in the future of between 250-350 koz. In order to realize this goal, we
will adopt various measures, including carrying out more exploration activities at different
exploration targets, upgrading our mining and processing infrastructure, driving improvements
in operations efficiency and at lower cost whilst maintaining the average gold processing
recovery rate at between 95%-96%.
In terms of our domestic gold assets, we have been undergoing several rounds of
technological transformation and we are still working on several technological improvement
projects, including continuous improvement of technique, upgrade of machinery, enhancement
of equipment, at the Wulong Gold Mine. These are expected to enable us to increase the
Wulong Gold Mine’s annual processing capacity from 578,000 tonnes to approximately
700,000 tonnes by the end of 2024 to maintain the sustainable development of our Company
to ensure the competitive edge. We have also initiated an expansion project at the Jilong Gold
Mine to increase its annual mining capacity to approximately 300,000 tonnes by the end of
2025.
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ESG Practice and Mining Safety
Adhering to our core value of benefitting more people through the development of
Chifeng Gold, we attach great importance to the environment and corporate governance, honor
our social responsibilities, emphasize mining safety, and care for our staff and the people and
communities in which we operate. We pursue high-quality and sustainable development with
high ESG standards and are committed to following the high standards and sound practices of
our industry.
 We continuously enhance our environmental management system, optimize water
resources, energy, and logistics management strategies, judiciously use natural
resources, practice the principles of the circular economy, strictly control and
manage tailings, waste, wastewater and pollutants, and minimize the negative
impact on the natural environment. In addition, we actively address climate change
and consider potential climate risks and impacts following the framework
recommendations of the Task Force on Climate-Related Financial Disclosures (the
“TCFD ”). As alternative energy and electricity continues to develop, we plan to
continuously increase our proportion of renewable energy use to reduce our carbon
emission. For example, the Wulong Gold Mine, Sepon Gold and Copper Mine and
Wassa Gold Mine are all actively planning to build their own clean energy power
generation projects, which will further enhance our capability to source and utilize
renewable energy. In particular, the Jilong Gold Mine is planning to build a
10-megawatt solar power plant, with the full capacity expected to be installed and
ready for commercial operation by the end of 2025.
 We prioritize the construction of green mines, actively seek a balance between
mining development and ecological impacts, and adhere to the development concept
of “Mutual Prosperity and Development” with the community. “Green mining”
refers to a plan where we intend to achieve scientific and orderly mining through
scientific mining methods, efficient resource utilisation, digital information
management, and harmonious community collaboration, in order to minimize
disruptions to mining areas and surrounding environments. It is a comprehensive
plan that includes our detailed management measures and criteria covering the
aspects of environmental management systems, natural resource utilisation systems,
efficiency improvement, emission reduction, tailings management, waste
management, emission gas management, noise management, biodiversity
maintenance, and sustainability. In 2023, our total investment in green mine
construction reached approximately RMB26.2 million, with a total land restoration
of approximately 62.3 hectares. To ensure workplace safety, we also conducted
2,375 workplace safety inspections and provided safety training for 33,495
participants in 2023. As a result, no significant safety or environmental accidents
occurred in 2023. Furthermore, in 2023 we invested approximately RMB212.8
million in compliance with the applicable environmental protection rules and
regulations in PRC, and we reduced approximately 1,057.4 tonnes of carbon dioxide
and its equivalent during the same period.
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 We seek to actively aim to explore solutions that bring positive impacts to the local
community. Amongst other things, we take actions in promoting employment, rural
revitalization, improving people’s livelihoods, and public welfare education. For
example, LXML has long supported construction of infrastructure in its surrounding
communities; the Golden Star Oil Palm Plantation Project (the “ Golden Star Oil
Palm Project ”) initiated by GSWL is a not-for-profit, multi-award winning social
enterprise that continues to empower small farmers and workers in Ghana by
providing them with support, management and agricultural extension expertise to
maintain and develop smallholder palm plantations and obtain steady income
streams; Hanfeng Mining assists the local community in resettlement work; and
Wulong Mining drives local economic development through high-quality
development. We leverage our own resource advantages, take action to shoulder
corporate social responsibility, and share our achievements with the society.
 Our ESG practices have been recognized through numerous honors and ratings,
reflecting widespread recognition from various sectors of society. For example, Our
Company was awarded the 17th Crystal Ball Award as the “2023 Most Socially
Responsible (ESG) Listed Company” in January 2024; the mines of Jilong Mining
and Hanfeng Mining were designated as National Green Mines in January 2020;
LXML received (i) the Certificate of Excellent (A) from the Laos government in
recognition of its exceptional implementation of its environmental management and
monitoring plan in January 2024, and (ii) the Third-Class Labor Medal from the Lao
government in December 2023 in recognition of its exceptional practice in work
safety, health care, and social welfare support to Laos employees; and GSWL was
honored with the Ghana 2023 Best Safe Mine First Prize from the Ghana Chamber
of Mines in November 2023.
 We adopt high safety standards and seek to continuously update and improve our
internal control measures to enhance production safety in our operations. Our
production management systems and technologies enable us to achieve automation,
digitization, and intelligence control in the gold production process. During the
Track Record Period, we did not have any material safety incidents involving our
workforce.
For more details, please see “— Environmental, Social and Governance”.
Management
Since 2019, we have transformed ourselves from a diversified mining company covering
various sectors into a mature, sophisticated, and specialized mining company with a global
outlook that is primarily focused on gold under the leadership of our management team. We
established our corporate culture of “Mutual Prosperity and Development” by unifying the
interests and goals of our shareholders, management, and employees, and adopted a long-term
internal incentive mechanism, which effectively motivates the management team and our key
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employees. Furthermore, by incentivizing our international management and key employees,
we have enhanced our decision-making processes and response mechanisms for international
management, which enables us to efficiently manage our operations across the globe and assess
strategic acquisition prospects.
Our management team consists of seasoned professionals with extensive expertise in
various fields, including, amongst other things, corporate administration, mining, mineral
processing, geology, finance, and law. Chairman Wang Jianhua, renowned for his exceptional
leadership skills within major corporate entities, brings a wealth of experience in management
and corporate governance which is characterized by an emphasis on employee safety and
welfare. The key members of our senior management team have previously been entrusted with
significant roles in reputable global mining companies, showcasing remarkable operational and
managerial track records. Moreover, our Company has enlisted experts such as scholars
professors from renowned universities and institutes, infusing the Board with robust
professional knowledge.
We are implementing worldwide talent integration using an open and transparent strategy,
engaging in sincere collaboration with both international and local management staff and
employees. Each mine is overseen and operated by a management team composed of local
specialists. We apply our previous experiences to our mines globally, while local experts
implement localized innovation and practices. We aim to maintain the representation of
Ghanaian, Laotian, and talents with international experience within our management. Our
executives directors boast an average of more than 20 years of pertinent expertise in the mining
industry, and we have introduced cutting-edge global management strategies to our mining
operations. Additionally, we actively promote talent growth and consistently screen and
cultivate high-quality talents through our international mining talent program.
We have established a long-term incentive mechanism for our employees through
employee stock ownership plans, aligning the interests of employees and our Company. These
incentives have boosted employees’ commitment and contributed to our continued high-
quality, sustainable growth. Shareholders’ interests are prioritized within our Company. The
robust support from our controlling shareholders and the proactive shareholding by members
of the management team and key employees further exemplify our corporate culture of “Mutual
Prosperity and Development”.
Financial Overview
During the Track Record Period, our total revenue was approximately RMB3,782.6
million, RMB6,266.8 million, RMB7,221.0 million and RMB6,222.8 million, respectively. The
revenue from the gold mining business for the Track Record Period was approximately
RMB2,968.7 million, RMB5,304.7 million, RMB6,322.3 million and RMB5,561.3 million,
representing 78.5%, 84.7%, 87.6% and 89.4% of the total revenue, respectively.
During the Track Record Period, the gross profit from the gold mining business was
RMB868.7 million, RMB1,465.8 million, RMB2,256.7 million and RMB2,508.2 million,
respectively.
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Recent Development
On March 4, 2024, an equity transfer agreement was entered into among China
Investment, Chixia Laos and Chijin Xiawu, pursuant to which Chixia Laos shall acquire from
China Investment 90% equity interest in China Investment Mining (Laos) Sole Co., Ltd. at a
total consideration of US$18,963,000. As of the Latest Practicable Date, we have obtained the
approval from the Xiamen Development and Reform Commission, and the parties to the
transactions were proceeding with the fulfillment of the other conditions of the transaction
including changes of the authorized representatives of the Target Group. This acquisition is
expected to strengthen our position in rare earth Resource development in Laos while
upholding our strategic focus on gold. See “History, Development and Corporate Structure —
Post-Track Record Period Acquisition.”
The Phase I Construction Project of the lower mining zone of the Hanfeng Polymetallic
Mine was completed in December 2024. It has passed production safety assessment and
obtained a production safety permit. The project officially commenced operation on December
30, 2024. It is expected to increase our production volume of copper, lead, and zinc by 435,000
tonnes.
Additionally, the expansion of the scope of mining right (deep-zone) for the Aohan
County Zhuanshanzi Gold Mine of Jilong Gold Mine was approved in November 2024. The
verification report for additional resources in this area has also been filed with the relevant
authority in November 2024. This is expected to enhance our production capacity and
utilization rate.
Since September 30, 2024 and up to the Latest Practicable Date, we had continued to
receive new purchase orders for our products.
COMPETITIVE STRENGTHS
We believe our leading market position is underpinned by the following competitive
strengths:
The largest non-state owned gold producer with leading growth in gold production and
revenue in China, possessing robust market prospects
We achieved rapid growth in gold production from 2021 to 2023. From 2021 to 2023, our
total gold production volume was 260.2 koz, 436.2 koz and 461.5 koz, respectively. Our gold
production grew at a CAGR of 33.1% from 2021 to 2023, outpacing the major gold producers
in China and making us the leading gold producer in China in terms of gold production growth
rate during the same period according to Frost & Sullivan.
Our domestic gold mines have relatively high ore grades, making them one of the top-tier
deposits in China. According to Frost & Sullivan, as of December 31, 2023, our major domestic
gold mines at the Jilong Gold Mine, Wulong Gold Mine and Huatai Gold Mine had the highest
gold grades among the top five gold producers in China.
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We have high visibility and certainties in our production expansion plans for our gold
mines and aim to achieve Resources and Reserves enhancement through exploration activities
as set out below:
 in terms of our overseas gold assets, we are accelerating the construction of the
open-pit and underground mining projects of the Sepon Gold and Copper Mine,
which is expected to increase the annual underground mining capacity to 806,000
tonnes by 2025 from the current capacity of 536,000 tonnes. Meanwhile, we are
accelerating modelling and study of exploration prospects of Discovery West Deeps
and Phavat North with open-pit and underground mining potentials. The annual
underground mining capacity is expected to be further increased after 2026 and
2027. As of September 30, 2024, the Inferred Mineral Resources for Discovery West
Deeps are estimated to be about 1,165 thousand tonnes with an average Au grade of
5.68 g/t; and
 in terms of our domestic gold assets, we have been undergoing several rounds of
technological transformation and we are still working on several technological
improvement projects, including continuous improvement of technique, upgrade of
machinery, enhancement of equipment, at the Wulong Gold Mine. These are
expected to enable us to increase the Wulong Gold Mine’s annual processing
capacity from 578,000 tonnes to approximately 700,000 tonnes by the end of 2024
to maintain the sustainable development of our Company to ensure the competitive
edge. We have also initiated an expansion project at the Jilong Gold Mine to increase
its annual mining capacity to approximately 300,000 tonnes by the end of 2025.
Apart from our core gold business, our planned exploration and development of rare earth
resources in Laos also create new growth opportunities. Anomalies in rare earth elements were
discovered at the Sepon Gold and Copper Mine during exploration in early 2021. Following
further studies, according to SRK report, as of September 30, 2024, the Mineral Resources for
rare earth oxides are estimated to be about 26.78 million tonnes of Indicated Mineral Resource
with an average grade of 383.75 g/t TREO, equivalent to 10.28 thousand tonnes of total rare
earth oxides within the Project area, and 63.79 million tonnes of Inferred Mineral Resource
with an average grade of 339.22 g/t TREO, equivalent to 21.64 thousand tonnes of total rare
earth oxides within the Project area. In October 2022, together with Xiamen Tungsten we
established a joint venture, Chijin Xiawu, where we hold a 51% equity interest. Chijin Xiawu
focuses on the development of rare earth resources in Laos. The collaboration with Xiamen
Tungsten is expected to improve our competitiveness in the development of rare earth and
generate new growth opportunities for our business. We have commenced the general
infrastructure construction and commence production.
Overseas experience and global recognition with proven track record in identifying
synergetic acquisition targets, executing transactions and integrating global operation
We believe that a core competitiveness metric of gold companies is the ability to
continuously obtain high-quality Mineral Resources. Newly discovered gold deposits in China
have been limited in recent years and the grade of gold is generally at a relatively low level.
As a result, we have strategically focused our expansion plan on identifying and acquiring
suitable and high-quality overseas assets to maintain a sustainable growth.
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We acquired LXML and GSWL in 2018 and 2022, respectively. As of September 30,
2024, our overseas assets accounted for approximately 65.2% of our total assets, and our
overseas revenue accounted for approximately 71.2% of our total revenue. According to Frost
& Sullivan, we are the gold company in China with the greatest overseas presence both in terms
of overseas assets contribution as of December 31, 2023 and in terms of overseas revenue
contribution in 2023.
Our management team has profound experience in overseas acquisitions. We have
established well-rounded decision-making and execution procedures in the identification of
acquisition targets, transaction execution and post-acquisition operation integration. For
example, our technical team accurately identified the Sepon Gold and Copper Mine’s
development potential once it is transformed from a copper-focused open-pit mine into a
gold-focused underground mine and decisively seized the acquisition opportunity. We had
extensive communication with local government authorities in the preliminary stage of the
acquisition. With regard to the Wassa Gold Mine, we carried out in-depth inspections and
research on areas with abundant gold Reserves in West Africa and properly assessed local
policies and the economic environment before deciding to acquire the Wassa Gold Mine. Based
upon a sensible understanding of the conditions presented and perceived, our management
team efficiently seized the opportunity. The speed and effectiveness of our decision-making
and execution procedures is evident from the fact that — an investment decision was made and
announced within eight months after we identified that opportunity.
The fact that we have a management team which is highly competent in integration and
operation of acquired overseas assets makes all the difference. Since the acquisition of LXML
in November 2018, we have promoted an inclusive culture during the integration process. We
advantageously fuse Chinese and international management models, ignite the passion for
work, and encourage creativity among our employees. We enhanced communications with local
government authorities and communities and supported them with job opportunities, skill
training, pandemic preventative measures and charity donations and enjoyed reciprocal
treatments. We transformed the processing plant at the mine and recommenced gold production
within 18 months — well ahead of schedule. Previous operators paused gold development at
the Sepon Gold and Copper Mine because of challenges in relation to processing refractory
ores. With continuous technological upgrades and a series of capital investments and
operational improvements, the mine’s gold recovery rate has increased significantly. In 2023,
the Sepon Gold and Copper Mine recorded a gold AISC of approximately $1,330.0 per ounce,
showing a decrease of 9.9% year-on-year.
Since the completion of our acquisition of the GSWL in January 2022, we have actively
promoted localized management and operation concepts, built up a sound relationship with
local government authorities, served local communities, and taken initiatives to contribute to
regional development. We were one of the first large-scale Chinese mining companies
operating in Ghana and have earned accolades for boosting the local economy. Since the
acquisition in 2022, we have been investing in improving efficiency and expanding the
production of underground mines, developing the 242 Ramp and B-shoot South Ramp to pave
the way for underground mining operations in 2024 and the next 5 years. In 2023, the Wassa
Gold Mine recorded a gold AISC of approximately US$1,197.1 per ounce, showing a decrease
of 12.7% year-on-year.
We believe our overall overseas capabilities in both acquisition and operational levels are
well proved by the track records of our successfully completed and integrated acquisitions. We
aim to further leverage our strengths in overseas expansions to achieve sustainable and
efficient growth.
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Continuously improving on the cost curve to enhance efficiency through technological
upgrade and to drive profitability
Under the leadership of our management team, we have implemented a series of cost
reduction and efficiency improvement measures. These initiatives have enabled us to achieve
a more favorable position on the cost curve relative to our industry peers. According to Frost
& Sullivan, our operational efficiency enhancement surpassed the worldwide industry average
by a notable margin and we positioned lower in terms of gold AISC than that of the global
average. As of December 31, 2023, our gold AISC stood at US$1,179.1 per ounce, placing us
in the first quartile in the worldwide industry, while the global average for the same period was
approximately US$1,348.5, which is 14.4% higher than ours. In 2023, we decreased our gold
AISC by 12.0%, whereas the average AISC for international gold producers increased by 7.2%
during the same period. Set forth below is our gold AISC and the global average for the periods
indicated:
Y ear Ended December 31,
Changes from
Y ear Ended
December 31,
2022 to Y ear
Ended
December 31,
2023
Nine Months
Ended
September 30,
20242022 2023
US$/ounce % US$/ounce
PRC Gold Mines /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,205.7 877.4 (27.2) 1,008.5
Sepon Gold and Copper
Mine /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,476.9 1,330.0 (9.9) 1,408.3
Wassa Gold Mine /H1118/H1118/H1118/H1118/H1118/H1118/H11181,371.2 1,197.1 (12.7) 1,240.8
Our Group /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,340.0 1,179.1 (12) 1,249.2
Global Average /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,258.1 1,348.5 7.2 1,498.8
Note:
1. Company started to make voluntary disclosure of AISC since the year of 2022, in align with the global
industrial reporting practice.
The global average AISC has increased from US$1,348.5/ounce for the year ended
December 31, 2023 to US$1,498.8/ounce for the nine months ended September 30, 2024. This
was primarily due to the ongoing rise in labor costs globally. In addition, driven by the rising
gold price, gold mining companies started to process lower-grade ores which led to higher
mining costs.
The AISC of our Group increased from US$1,179.1/ounce for the year ended December
31, 2023 to US$1,249.2/ounce for the nine months ended September 30, 2024. This was mainly
because (i) the production volume of LXML for the third quarter of 2024 fell short of our
expectations due to the impact of typhoons and floods, resulting in an inability to spread labor
and depreciation costs; and (ii) labor costs and raw materials costs increased driven by global
inflation.
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The AISC of our PRC Gold Mines was significantly lower than that of our gold mines in
Ghana and Laos during the Track Record Period. This was primarily due to higher cost of our
gold mines in Laos and Ghana comparing to the PRC Gold Mines due to the following reasons:
(i) firstly, our gold mines in Laos and Ghana have relatively higher procurement costs.
Located in areas with underdeveloped industries, apart from energy sources like
diesel and electricity which are locally available, the acquisition of production-
related raw materials such as explosives, chemicals, steel, and spare parts mostly
requires importation and transportation to the mines. The long shipping distances
lead to higher “procurement costs” in the unit sales costs of our mines in Laos and
Ghana compared to the PRC Gold Mines; and
(ii) moreover, our gold mines in Laos and Ghana request relatively higher service and
support investments compared to the PRC Gold Mines. During the production
process, our mines in Laos and Ghana often employ contractors and service
providers to carry out mining, drilling, and other related work. In addition, we also
provide services such as camp accommodation, meals, and charter flights for
employees of our gold mines in Laos and Ghana. These services are considered
supporting costs for mining production. As a result, the “services and others”
component in the unit sales cost of overseas mines is higher than that of the PRC
Gold Mines.
LXML has made significant progress in reducing unit costs through improvements in gold
recovery rates and the implementation of underground mining projects. Since resuming gold
production in 2020, the LXML team has made great strides in overcoming challenges related
to refractory ore and has continuously improved its ore processing and recovery processes. We
have implemented a series of technical measures to minimize the environmental impact of our
carbon-in-leach (CIL) process, including carbon desorption, recycling process improvements,
industrial water quality enhancements, and the replacement of certain chemicals to reduce the
impact of chloride ions. Moreover, we launched an underground mining project in a selected
mining area in the first half of 2022. The project involves mining underground mines with a
depth of 450 meters below the surface. This initiative has helped us to increase our gold
processing recovery rate. We also adopted a series of capital investments and operational
improvements which were completed to debottleneck process constraints and improve plant
reliability and efficiency. As a result, the mine’s gold recovery rate increased significantly from
54.6% in 2021 to 64.4% in the nine months ended September 30, 2024. Looking ahead, through
the adaption of the replacement from active carbon to resin and one regrinding technique, we
expect that the gold processing recovery rate of the Sepon Gold and Copper Mine will further
increase to approximately 75% by June 2025. In 2023, the Sepon Gold and Copper Mine
recorded a gold AISC of approximately $1,330.0 per ounce, showing a decrease of 9.9%
year-on-year.
We have also achieved significant progress in cost reduction at the Wassa Gold Mine by
optimizing procurement channels, enhancing material utilisation, and increasing our
production capacity, in addition to other initiatives. In 2023, the Wassa Gold Mine recorded
gold AISC of approximately US$1,197.1 per ounce, showing a decrease of 12.7% year-on-year.
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In terms of our domestic operation, we seek to continuously improve our operational
efficiency and recovery rate at our mines through incremental changes and investments, and
this is evident from, for example, the implementation by both the Jilong Gold Mine and the
Huatai Gold Mine of the tailings decyanide pressure filtration processes, which improves our
recovery of valuable metals like gold and silver from the tailings solution, leading to, inter alia,
improved economic benefits, attaining an internationally advanced standard, and achieves a
greater water balance and recycling in the concentration production following cyanide tailings
treatment.
The operational effect of these continuous improvements is evident from the fact that in
2023 our PRC Gold Mines recorded gold AISC of approximately US$877.4 per ounce, showing
a decrease of 27.2% year-on-year.
Overall, we remain committed to ongoing efforts in cost reduction and efficiency
improvement across our operations, with a view towards achieving greater cost
competitiveness and operational excellence in the years ahead.
Distinctive “Mutual Prosperity and Development” corporate culture and effective
incentive programs continuously motivate the management and employees to boost
continuous growth
We established our corporate culture of “Mutual Prosperity and Development” by
unifying our shareholders, management and employees, where the interests of stakeholders and
our Company are aligned such that our shareholders, managers and workers share the successes
and face the challenges together, as they are all invested in the same collective goal. Led by
Chairman Wang Jianhua, the teams across our Company are united by shared missions and
vision, and our Company has developed a management model and a long-term incentive
mechanism that cater to its conditions and has performed effectively in reducing costs and
improving efficiency.
In September 2020, we launched the Phase I ESOP and as of April 30, 2021,
approximately 41.6 million shares were repurchased for the purpose of equity incentives,
involving no more than 98 core employees of both the headquarters and our subsidiaries. In
January 2022, we announced the Phase II ESOP . As of April 28, 2023, approximately 16.6
million shares had been repurchased amounting to RMB300.9 million in value, where the
repurchased shares would be used for the Phase II ESOP . In June 2023, we launched the Phase
III ESOP and as of June 27, 2024, approximately 15.2 million shares were repurchased for
purpose of equity incentives or employee stock ownership, amounting to RMB220.0 million in
value. The equity incentives align the interests of the key employees with those of our
Company, laying a sound foundation for high-quality and sustainable growth. Please refer to
the section headed “C. Further Information about our Directors, Supervisors and Substantial
Shareholders — 4. Employee Stock Ownership Plans” in Appendix VII of this Prospectus for
further details of the ESOPs.
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Our corporate culture of “Mutual Prosperity and Development” is strongly supported by
our shareholders. Following the successful implementation of various rounds of share incentive
arrangements for our key management throughout the years since 2020, the shareholding of the
largest shareholder (and its associates) had dropped to 14.54% as of December 31, 2023 from
20.59% as of December 31, 2020. Meanwhile, the management team’s shareholding had
increased. In January 2021 and February 2024, our management team increased its
shareholding by further purchasing our Company’s shares on the secondary market. As of
September 30, 2024, the management team and the key employees of our Company in
aggregate held approximately 4.5% of the total shares outstanding. We believe the current
shareholding and corporate governance structure reflect a management approach that
prioritizes the interests of all shareholders.
With the proper mechanism, the management team is well incentivized, contributing to
the ongoing growth and development of our Company. From 2021 to 2023, we achieved an
unparalleled CAGR of 33.1% in gold production among all major gold producers in China
according to Frost & Sullivan.
A strong social responsibility and solid commitment to promoting green and sustainable
development with high ESG standards
We attach great importance to the environment and workplace safety. We care about the
people and communities in which we operate and honor our social responsibilities. Upon
joining our Group as a director in August 2022, Ms. Lydia Y ang introduced a series of reforms
to continuously improve our ESG practice. In September 2022, the Strategy and Sustainable
Development Committee under the Board of Directors was established, and it has been chaired
by Chairman Wang Jianhua. The purpose of this committee is to provide support and guidance
for our medium- and long-term development strategies, decision-making on major investments
for our sustainable development and to supervise the preparation and implementation of our
ESG goals. In March 2023, the ESG reports of LXML and GSWL were issued, and in March
2024 a consolidated ESG report covering all mines of the company was issued.
International industry standards and best international practices are applied in our
overseas mines and the same standards are adopted in our domestic mines on a step-by-step
basis. The Wassa Gold Mine executes relevant ESG procedures in accordance with the
standards required by the World Gold Council (WGC) and the United Nations Global Compact
(UNGC), a voluntary initiative based on the management’s commitments to implement
universal sustainability principles and to take steps to support UN goals, and publishes ESG
reports on a regular basis. Before our acquisition, MMG Limited, the shareholder of LXML at
that time, was part of the International Council on Mining and Metals (ICMM). Starting from
our acquisition of LXML in November 2018, we have consistently upheld ICMM standards in
the mining operations of LXML. We are also making efforts to ensure greater compliance with
WGC standards by consolidating the governance of our domestic and overseas mines and
continuously seek to improve the ESG governance of our mines.
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We have demonstrated a distinctive performance in various ESG matters, leveraging a
well-founded framework that adheres to high national and international industrial standards.
Our integrated management system and infrastructure aim to decrease pollutant emissions and
restore land for agricultural and functional purposes. Our commitment to sustainable
development has been acknowledged through various honors and ratings. For example: (i) the
Jilong Gold Mine and Hanfeng Polymetallic Mine were designated as National Green Mines
in January 2020; (ii) the Wulong Gold Mine and Huatai Gold Mine were rated as Provincial
(Autonomous Region) Level Green Mines in December 2020 and May 2020, respectively; and
(iii) the Sepon Gold and Copper Mine received the Certificate of Excellent (A) from the Laos
Government in recognition of its exceptional implementation of its environmental management
and monitoring plan in January 2024.
As of December 31, 2023, we had rehabilitated approximately 514.3 hectares of land,
demonstrating our unwavering dedication to sustainable practices. In 2023, we completed the
construction of the gravity-fed water supply system project in Vilabouly District, Laos, which
significantly enhanced the agricultural production efficiency of the local community. Our
commitment to community development is further exemplified by our support for local projects
such as the Golden Star Oil Palm Project, for which we were awarded by the Ghanaian
Government in June 2022. In the third quarter of 2022, we received five awards in Women in
Mining and Energy Award (WIMEA) in Africa, highlighting our focus on promoting diversity
and inclusion.
We have also implemented strong governance initiatives in Ghana and continuously strive
to reduce our energy consumption and emissions. We prioritize workplace safety and the health
and development of our employees and have implemented systematic measures and protocols
to achieve these goals.
In addition to our commitment to sustainability and community development, through
LXML we have been investing in eliminating unexploded ammunition and local economic
development in Laos. Through community development funds, LXML also contributes direct
and indirect welfare benefits to the local government. Furthermore, GSWL is also dedicated to
local community development funds, further underscoring our commitment to sustainable
practices and community development.
Seasoned and dedicated management team with deep expertise in the gold industry and
proven track record in mine operations locally and globally
We have assembled a highly skilled and experienced team of industry and capital markets
experts, covering a broad range of disciplines, including, among other things, corporate
management, mining, processing, geology, finance, and law. Our team boasts comprehensive
experience in various aspects of the gold industry such as corporate governance, technology,
mergers and acquisitions, overseas mine operations, environmental protection, safety, and
social responsibility. Under our existing equity and corporate governance structure, the
management team pursues interest consistent goals with all shareholders and employees.
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Renowned for his charismatic and exceptional management capabilities, Chairman Wang
is a transformative and effective leader who time and again has leveraged his extensive
experience and know-how in managing and leading large-scale enterprise groups, global mine
mergers and acquisitions, and global mining operations to unlock value and catapult businesses
to higher levels under the creed of “Mutual Prosperity and Development”. Before joining
Chifeng Gold, he served as chairman of Shandong Gold Group Co., Ltd. (“ Shandong Gold ”),
director and president of Zijin Mining Group Co., Ltd. (“ Zijin Mining ”) and chairman of
Y unan Baiyao Holdings Co., Ltd. (ʮ̡).
During his tenure at Shandong Gold, Chairman Wang proactively implemented
transformative governance, management and operational reforms to, inter alia, improve worker
safety, corporate governance, operational resilience, and improve overall performance,
streamlined corporate policies and protocols, championed large-scale, green development and
production of gold mines, and completed a series of high-grade mine acquisitions in China.
While at Shandong Gold, Chairman Wang implemented the principle of “Resources are the
Unshakable Fundamental Interests of Shandong Gold” (“͉л
ू”). Under Chairman Wang’s leadership and influenced by his first-mover spirit, Shandong
Gold engaged in the first deep drilling for gold exploration in China (“ୋɓଉ
᝝”), which included three groundbreaking and precedent-setting hole depths of 3,000 meters,
3,000 meters and 4,000 meters, respectively, in the Xiling mining area of Sanshan Island,
Laizhou, which have been deemed of epoch-making significance for the Chinese mining
industry. In addition, Chairman Wang supported a major scientific research “Ultra-deep
Comprehensive Geological Research and Resource Prediction in Northwest Jiaoxi Gold Ore
Concentration Area” (“Ӻၾ༟๕ཫ಻”). From these
initiatives, the Resources, Reserves and production capacity of Shandong Gold increased
significantly during his tenure, the number of mines within the group increased, and in 2012
Shandong Gold was among the top gold producers in China.
During his tenure at Zijin Mining, as President and director of Zijin Mining, Chairman
Wang placed employee safety as a top priority and overhauled the company’s environmental,
social and corporate governance by implementing greater safety standards and new
management policies to lay a strong foundation for future growth. In addition, Chairman Wang
participated in the successful acquisition of a series of high-profile mining companies and
mines, including Norton Gold Fields, Kolwezi Copper Mine, Kamoa-Kakula Copper Mine,
Porgera Gold Mine, and other overseas mines, boosting Zijin Mining’s quality of gold and
copper Resources and Reserves.
As a pioneering leader, Chairman Wang’s record at our Company includes undertaking a
series of value-adding investments to boost our annual gold output from 48.8 koz in 2018 to
461.5 koz in 2023 — an increase of nearly 10 times, improving our foundation for continued
and greater success, and successfully leading and managing a drilling program through 2021
to 2022 in Dandong area with a record-breaking depth of 3,003 meters, which introduced a new
era of deep drill gold exploration in China’s northeast region. Characteristic of Chairman
Wang’s leadership style is his attention to detail, grand bird’s-eye view, and mindfulness of
employee safety and welfare. Under Chairman Wang’s leadership, we have formed a team of
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international experts to carry out in-depth research on high-quality assets across the globe,
further streamlined our business, seized acquisition opportunities for high-quality assets,
obtained and developed leading technologies, promoted greater employee safety and welfare,
and developed a strong management practice with a global outlook.
We are aligning talent on a global scale through an open and transparent method,
promoting collaboration among international and local management and staff. Our mines
around the world are overseen and run collectively by a seasoned management team and local
specialists. This enables us to leverage our previous experiences our mines across the globe and
implement region-specific innovations and practices guided by local experts.
Our Chief Executive Officer, Ms. Yi-fang Y ang, has extensive managerial experience in
the global mining industry, Hong Kong listed companies and capital markets generally. For
example, Ms. Y ang served as Head of the Business Development Department (October 2010 to
October 2011) and later executive director and CEO (September 2011 to January 2013) of CST
Mining Group Limited, a company previously listed on the Main Board of the Hong Kong
Stock Exchange until December 2023 (stock code: 0985) (“ CST Mining ”), and between June
2018 to April 2020 she served as an executive director and president at Hengxing Gold Holding
Company Limited (ʮ̡), a company previously listed on the Main
Board of the Hong Kong Stock Exchange (stock code: 2303) until it was acquired by Shandong
Gold for around HK$3 billion.
Illustrative of Ms. Y ang’s entrepreneurial nature and prowess in skillful execution, she
was a driving force in a series of major deals while at Zijin Mining and CST Mining, including
(i) Zijin Mining’s investment of USD200 million in Glencore’s USD2.2 billion convertible
bond issue, which formed part of Zijin Mining’s plan to “form a long-term strategic partnership
with Glencore through the subscription”; and (ii) CST Mining’s sale of the Mina Justa Copper
Project in Peru for USD505 million to a subsidiary of Minsur S.A. — one of the major mining
transactions in that year; Minsur was at the time the world’s fourth largest tin producer and
Peru’s largest tin miner by tonnage.
Furthermore, she has significant operational experience, including at mines in the PRC,
CST Mining’s Lady Annie Copper Mine in Australia, where she stabilized the mine operation
and turned around the mine from lossmaking to profitmaking, and Mina Justa Copper Project
in Peru. In addition to the abovementioned positions, Ms. Y ang’s distinguished managerial
record includes serving in positions as chief executive officer of CST Mining, senior
management positions in various group companies of Zijin Mining, including as the
chairperson of Xiamen Zijin Tongguan Investment Development Company Limited (ږ
ʮ̡) and the director and general manager of Gold Mountains (H.K.)
International Mining Company Limited (ʆ(ಥ)ʮ̡).
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Since joining our Group, Ms. Y ang has implemented a series of management and
operational changes to strengthen our Company’s cashflow management, internal control and
corporate governance, and championed technological upgrades across our operations
throughout the world to minimize costs, improve mine recovery rates, advance operational
excellence, and improve employee health and safety. In adherence to our value to “benefit more
people through the development of Chifeng Gold”, Ms. Y ang has also prioritised “best in class”
health and safety standards and strengthened safety awareness for our staff across the world,
promoted responsible mining, emphasized the need for a responsible and excellent supply
chain that strives to deliver a cost-efficiency and sustainable operation, and implemented other
ESG measures, such as promoting greater equality and inclusion, across our Group to
strengthen the basis for our continued success and take us ever closer to be a prominent gold
producer well recognized around the world.
Mr. Lyu Xiaozhao, our Executive Director, Vice President and Chief Engineer, has been
a leading force within our Group. After successfully leading our Company’s Major Asset
Restructuring in 2012, he has successively served as a Director and General Manager of Jilong
Mining from December 2012 to August 2018, the General Manager of our Company from
December 2012 to February 2016, the Chairman of the Board of our Company from February
2016 to December 2019, the Deputy Chairman of the Board and Chief Executive Officer of our
Group from December 2019 to January 2022 and the Co-chairman of the Board of our
Company from January 2022 to September 2023, respectively. Mr. Lyu’s business acumen,
leadership skills and business development have been instrumental to help shape and develop
our Group to its current heights.
Mr. Lyu has significant management experience leading listed and non-listed companies,
including, in addition to his stellar record at our Company, successively serving as a Deputy
Party Secretary, Executive Director, Deputy General Manager, and a member of the Strategic
Committee of Lingbao Gold Group Company Limited, a company listed on the Main Board of
the Hong Kong Stock Exchange (stock code: 3330), from September 2002 to March 2011.
Mr. Lyu also serves in positions of trust, including as Vice President of the China Gold
Association (՘ึ) since December 2019, Vice Director of the Mining Geology
Professional Committee of the Geological Society of China (ࡰ
ึ) since December 2011, a member of the National Technical Committee on Gold of
Standardization Administration of China (ึ) since May 2008. Due to
his managerial record, expertise and mining insight, Mr. Lyu is a sought-after keynote speaker
for mining related conferences, including, for example, as the keynote speaker at the World
Gold Technology Conference jointly organized by the China Gold Association, the Society for
Mining, Metallurgy, and Exploration (SME) of the United States, the Canadian Institute of
Mining, Metallurgy, and Petroleum (CIM), the Australasian Institute of Mining and Metallurgy
(AusIMM), and the South African Institute of Mining and Metallurgy (SAIMM).
To stay up to date with the latest research, developments and best practices within the
mining industry and related businesses and to improve the quality of the decision-making
process of our Company, our Board regularly connects with acknowledged professors,
researchers and other scholars from top tier universities and research institutions.
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Since 2022, our Board has included four Independent Directors: two of which are
well-known scholars from a top educational institution in China, and one of which is a senior
professor specializing in geology, mining, and processing.
BUSINESS STRATEGIES
We aim to become a world-class gold mining company and we intend to implement the
following business strategies to achieve our goal.
Continue to increase Ore Reserves through exploration activities and expand production
volume at existing mines to realize our full growth potential
Our existing mines at home and abroad are situated in favorable mineralization
environments, showcasing significant exploration prospects across the majority of the relevant
mining regions. Therefore, we plan to further maximize the potential of our existing mines by
continuous production expansion, further exploration and Reserve enhancement as set out
below:
For Wulong Gold Mine, we have identified several areas of gold mineralisation in its
mining area and its peripheral areas, a precursor of exploration and Reserve enhancement in
its deep and peripheral areas. We are advancing multiple underground development projects at
the Wulong Gold Mine to increase its annual processing capacity from 578,000 tonnes to
approximately 700,000 tonnes by the end of 2024. The mine’s average daily processing
capacity increased to over 1,800 tonnes in the second half of 2023. We will continue investing
in exploration and Reserve enhancement at the mine to tap into the potential of Resources in
the deep and peripheral areas. We have also entered into cooperation framework agreement
with China Geological Survey Bureau Shenyang Geological Survey Center, which is expected
to strengthen the exploration foundation.
For the Jilong Gold Mine, we have undertaken drilling programs in both peripheral and
deep areas, yielding promising results such as the discovery of industrial ore bodies in six drill
holes. We have completed the 180,000-tonne gold ore processing plant expansion project and
commenced trial production by June 2024. We plan to increase annual mining capacity to
approximately 300,000 tonnes by the end of 2025. Additionally, we initiated construction of a
new tailings storage facility in November 2023, with other construction projects progressing as
planned. We have entered into a framework agreement with the Aohanqi Longxing Resources
Development Company Limited, and this cooperation is expected to expand our exploration
area.
For the Huatai Gold Mine, the expansion project is currently under construction and it
will initiate a comprehensive transformation of the mine’s infrastructure and the
commencement of shaft engineering construction by the end of 2024. Infrastructure
development is projected to be substantially finished by the end of 2026, with the Huatai Gold
Mine gradually recommencing mining operations in 2026. Upon completion, we expect to
increase the Huatai Gold Mine’s annual mining capacity by an additional 30,000 tonnes.
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For the Sepon Gold and Copper Mine, we will continue our further construction and
production expansion plans for underground mines and proceed with the exploration in the
peripheral areas of the mine. For example, the Sepon Gold and Copper Mine has commenced
development system construction in its mining area since April 2022, which facilitates
underground mining at 450 meters below the surface providing access to the deeper Mineral
Resources. We are also conducting a series of research projects at the underground copper mine
and open-pit copper mine to increase the gold and copper Reserves and further improve ore
processing recovery rates.
In addition, we formed a joint venture with Xiamen Tungsten in September 2022 (with
our equity interest being 51%) to synergize and strengthen our respective positions in rare earth
Resource development in Laos. We believe our planned development of rare earth resources
will bring another growth opportunity for our business.
For Wassa Gold Mine, we will further expand our mining and processing capacity, with
a goal to develop the Wassa Gold Mine into a large-scale gold mine and expect to achieve (i)
an annual processing capacity of approximately 3.3 million tonnes and (ii) an annual
production of 350 koz gold by the end of 2028. Apart from that, we will also carry on our
continued exploration of the peripheral areas of the Wassa Gold Mine for more Resources and
Reserves as well as a longer mine life.
For more details, please see “— Development and Expansion”.
Continue to obtain Resources and Reserves and increase production volume through
domestic and overseas acquisitions of high-quality gold assets for robust and sustainable
growth
We believe one of the core competitive strengths in the gold industry is the ability to
continuously obtain high-quality Resources and Reserves. According to Frost & Sullivan, we
ranked fifth among gold producers in the PRC in terms of gold Resources and have gold
Resources of 13.6 million oz as of December 31, 2023. Furthermore, we ranked fifth among
gold producers in China in terms of gold production, with gold production of 461.5 koz,
representing 3.8% market share, in 2023. We will seek to source further high-quality assets and
will remain focused on both domestic and overseas quality assets to keep expanding the scale
of our Resources and gold production, and further consolidate and strengthen our market
position.
The following factors are considered in our assessment of potential acquisitions:
 Asset quality and production volume: Asset quality is the primary factor for
consideration in potential merger and acquisition transactions. Close attention will
be paid to high-quality assets, i.e., those with large Resources, high grade, high
production volume and low production cost;
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 Asset location: Preferably countries or regions such as Oceania, West Africa,
Eastern and Northern Europe, Central Asia, with stable political and economic
landscape and relatively low risks;
 Stages of assets: To proactively manage the risk associated with acquisitions, we
focus on open-pit producing assets or brownfield projects nearing production; and
 Equity stake of assets: We seek strategic investment prospects, focusing on
opportunities to acquire controlling shareholdings of the target asset.
At the same time, we intend to persist in acquiring further cutting-edge, international
technologies and mining management techniques, operational models, and global talent
through overseas acquisitions for our long-term growth. We actively implement international
strategies and progressively infuse ESG principles into all facets of our mining production and
operations across the world. We consistently aim to adhere to relevant global industry
standards and optimum practices in our overseas mines and move towards standardized
integration in our domestic mines. As a prominent national gold enterprise in China, we joined
the Shanghai Gold Exchange as a full-fledged member in 2023. Our efforts have been
acknowledged with multiple national accolades and awards for promoting mining safety,
environmental conservation and sustainable development.
Continue to improve productivity, reduce cost and enhance profitability
With the current industry trend of increasing overall costs in the gold mining sector and
the scarcity of high-grade Mineral Resources, we recognize the critical importance of
enhancing operational efficiency, cutting expenses, and boosting profitability for our long-term
sustainability. Our strategy involves ongoing exploration of innovative technologies, along
with a dedicated focus on cost-cutting measures such as centralized procurement,
organizational streamlining, workforce optimization, and detailed assessment of gold
production and pricing strategies.
To further drive cost efficiencies, we have adopted global centralized procurement center
in Shanghai for our mines both domestically and internationally. Through such centralized
procurement and resource optimization, we aim to effectively control and reduce procurement
costs securing low prices and favorable contractual terms. In 2023, our global procurement
center entered into certain framework agreements facilitated bidding processes for 41 projects,
spanning critical price terms construction, equipment, services, and bulk material acquisitions
essential for exploration, mining, and processing operations.
In addition, we intend to consistently apply tailored strategies based on the specific
circumstances of each mine to enhance efficiency and reduce costs. We plan to continue
research on processing technologies to optimize Resource utilisation. For instance, at the
Sepon Gold and Copper Mine in Laos, we applied a new regrinding ball mill, tested waste
rejection techniques and adopted resin instead of activated carbon, all showing great potential
to elevate recovery rates and cut costs.
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Beyond cost reduction efforts, we are dedicated to optimizing operational effectiveness.
In particular, post-acquisition of new assets we will seek to optimize the corporate framework
to lower administrative expenses and identify additional cost-saving methods. For example,
detailed budget and capital management strategies have already resulted in significant
enhancements. Recent steps, such as stringent cost controls through organizational
restructuring and trimming non-essential positions, underscore our dedication to prudent
financial stewardship and the enduring success of our business.
Adhere to our culture of “Mutual Prosperity and Development” to ensure strong
motivation for the management team and employees
We firmly believe that highly efficient systems and mechanisms are key factors for
continuous business growth and success in the global gold mining industry. The corporate
culture of “Mutual Prosperity and Development” will be valued and put into action.
In 2023, we implemented the third phase of share repurchases, with the repurchase
amount of RMB220 million as of December 31, 2023. The repurchased shares will be used for
equity incentive plans or employee share ownership plans. This is anticipated to strengthen our
employees’ loyalty and dedication and, foster a more cohesive work environment. In the future,
our equity incentives will be more inclusive by offering equity or phantom stock incentives to
both domestic and overseas teams and further increase the management team’s shareholding.
The implementation of equity incentive schemes is poised to enhance employee engagement
and performance, aligning individual goals with organizational objectives.
Continue to improve our ESG governance and enhance our standards of environmental
protection, safety, social responsibility and corporate governance
We will constantly consider the environment, the safety and care of our people and
communities, and our social responsibilities as key targets in our corporate development
activities, including the following:
We are committed to energy saving and emissions reduction. Overall, we are transitioning
to cleaner, more efficient energy sources for our mining activities. As part of our commitment
to emissions reduction, we are currently evaluating the potential of renewable energy sources
for our operations. We are exploring various options for renewable energy projects with an aim
to achieve a 30% reduction in greenhouse gas emission intensity by 2030. We have opted for
energy-efficient and eco-friendly machinery for all newly constructed ore processing plant
areas and are progressively upgrading high-energy-consuming equipment at the existing
operational sites. In particular, the Jilong Gold Mine is planning to build a 10-megawatt solar
power plant and expects to have the full capacity installed and ready for commercial operation
by the end of 2025. Concurrently, the Wulong Gold Mine, Sepon Gold and Copper Mine, and
Wassa Gold Mine are also actively strategizing the development of their renewable energy
systems, thereby bolstering our renewable energy utilisation capabilities. Moving forward, we
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aim to expedite the advancement of new energy infrastructure, actively participate in
low-carbon transitions, systematically and gradually phase out fossil fuels through diverse
clean energy blends and accomplish our transition to substantial decarbonization.
We aim to promote green mining and land rehabilitation throughout our global operation.
For instance, we are committed to our Golden Star Oil Palm Project in Ghana, through which
we contribute to post-mining environmental restoration and support the Sustainable
Development Goals adopted by the United Nations. By December 31, 2023, we had grown
more than 140,000 oil palm trees in ten different communities covering more than 1,000
hectares of land. We will continue to fund the Golden Star Oil Palm Project through our
contribution of US$1 per oz of gold produced. We will also continue to undertake biodiversity
conservation activities in Ghana.
 We will further enhance our waste management capability. We are dedicated to
minimizing the environmental impact of our operations, including the safe and
comprehensive utilisation of tailings. To this end, we utilize decyanide technology
for the harmless treatment of tailings, while adopting a dry discharge method for
domestic mine tailings slag. We also aim to reduce the amount of tailings in
stockpiles, and repurpose them as filling materials for mine geological environment
management and road subgrade materials where feasible. In addition, we take
proactive measures to minimize the impact of tailings on the environment, including
covering tailings discharged into the tailings pond with soil, planting grass for
greening, and conducting ongoing monitoring of groundwater, soil, and solid waste
either internally or by enlisting the expertise of third-party specialists.
 We will continue to provide economic benefits and supports to local communities.
We seek to contribute to host communities through economic upliftment, by
contributing to community development funds, paying our fair share of taxes and
prioritizing local recruitment, as well as by supporting local vendors through
procurement and training.
BUSINESS MODEL
We are a fast-growing, international gold producer mainly engaged in the mining,
processing and sales. As of the date this Prospectus, we conducted our gold mining business
through: (i) four subsidiaries in the PRC, namely Wulong Mining, Jilong Mining, Huatai
Mining and Jintai Mining; (ii) one subsidiary in Laos, namely LXML; and (iii) one subsidiary
in Ghana, namely GSWL. In addition, we engaged in exploration, mining, processing and sales
of other Mineral Resources, which mainly include (i) non-ferrous metals produced by our PRC
subsidiary, Hanfeng Mining, (ii) copper cathodes produced by LXML. Aside from our main
business above, we engaged in recycling of waste electronic products and electrical appliances
business through our PRC subsidiary, Guangyuan Technology.
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Set forth below is an illustration of geographic coverage of our operation, including key
subsidiaries and mine locations, as of the Latest Practicable Date.
Golden Star Wassa
Ghana
LXML
Laos
Jintai Mining
Yunnan, China
Wulong Mining
Liaoning, China
Hanfeng Mining
Jilin, China
Huatai Mining
Inner Mongolia, China
Jilong Mining
Inner Mongolia, China
Our gold production business produces doré, gold concentrate powder and gold-loaded
carbon with different gold content. Our gold production experienced rapid growth during the
Track Record Period, with total gold production volume of approximately 260.2 koz, 436.2
koz, 461.5 koz and 345.6 koz, respectively. According to Frost & Sullivan, we ranked first
among the top five gold producers in China, in terms of gold production growth rate from 2021
to 2023, during which period our gold production grew with a CAGR of 33.1%.
Our doré product
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In terms of our other Mineral Resources business, the non-ferrous metals we mine through
the Hanfeng Polymetallic Mine are processed into a wide range of products including (i) zinc
concentrate powder, (ii) lead concentrate powder (containing silver), (iii) copper concentrate
powder, (containing silver) and (iv) molybdenum concentrate powder. We also produce copper
cathode in Laos through the Sepon Gold and Copper Mine. In addition, as Laos possesses
abundant rare earth Resources, we have leveraged our established infrastructure and
technologies to expand rare earth business in Laos.
Mineral Resources and Reserves
Independent Report
We engaged SRK Consulting (China) Ltd., an Independent Third Party and an
international consulting company that offers advice and solutions to resource industries for
mining projects, as the Independent Technical Consultant, to prepare the Competent Person’s
Report as set out in Appendix IIIA-IIID to this Prospectus, which is an independent assessment
and evaluation of our Mineral Resources and Ore Reserves as of September 30, 2024.
The information set forth below relating to our Mineral Resources and Ore Reserves
constitutes forward looking information, which is subject to certain risks and uncertainties.
Please refer to “Risk Factors” and “Forward-Looking Statements” for details.
According to the Independent Technical Consultant, except for the expected addition of
two new areas of mineralisation at the Jintai Gold Mine, there was no material change in the
Competent Person’s Report or our Mineral Resources and Ore Reserves estimate since
September 30, 2024, being the effective date of our Mineral Resources and Ore Reserves
estimate, and up to the date of this Prospectus.
Our Mineral Resources and Ore Reserves in China
The following table, which is based on the Competent Person’s Report in accordance with
the JORC Code, sets forth the information of our gold Resources in the PRC as of
September 30, 2024:
Mineralized
Zone/Block Category Tonnage Au Grade
Au Metal
Contained
Au Metal
Contained
(kt) (g/t) (koz) (t)
Wulong Gold Mine /H1118/H1118Measured ––––
Indicated 1,261 8.17 332 10.30
Inferred 1,738 7.21 402 12.53
Total 2,999 7.61 734 22.83
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Mineralized
Zone/Block Category Tonnage Au Grade
Au Metal
Contained
Au Metal
Contained
(kt) (g/t) (koz) (t)
Jilong Gold Mine /H1118/H1118/H1118Measured 484 12.19 190 5.90
Indicated 424 9.25 126 3.92
Inferred 508 9.24 151 4.70
Total 1,415 10.25 467 14.51
Huatai Gold Mine /H1118/H1118Measured 385 5.88 73 2.27
Indicated 2,146 7.27 502 15.60
Inferred 1,281 6.90 284 8.83
Total 3,812 7.01 859 26.71
Jintai Gold Mine /H1118/H1118/H1118Measured 3,363 1.68 181 5.64
Indicated 4,604 1.02 151 4.70
Inferred 2,699 1.29 112 3.49
Total 10,666 1.30 444 13.82
Total
consolidated /H1118/H1118/H1118/H1118/H1118Measured 4,232 3.26 444 13.80
Indicated 8,435 4.09 1,110 34.52
Inferred 6,226 4.75 949 29.55
Total 18,893 4.12 2,503 77.87
Note:
1. Numbers have been subject to rounding. Accordingly, figures shown as totals in the table may not be
an arithmetic aggregation of the figures preceding them.
As of September 30, 2024, the Mineral Resources for Wulong Gold Mine are estimated
to be about 2,999 thousand tonnes with an average Au grade of 7.61 g/t, including
approximately 1,261 thousand tonnes of Indicated Mineral Resources with an average Au grade
of 8.17 g/t, and 1,738 thousand tonnes of Inferred Mineral Resources with an average Au grade
of 7.21 g/t. The Mineral Resources for Jilong Gold Mine are estimated to be about 1,415
thousand tonnes with an average Au grade of 10.25 g/t, including approximately 484 thousand
tonnes of Measured Mineral Resources with an average Au grade of 12.19 g/t, 424 thousand
tonnes of Indicated Mineral Resources with an average Au grade of 9.25 g/t, 508 thousand
tonnes of Inferred Mineral Resources with an average Au grade of 9.24 g/t. The Mineral
Resources for Huatai Gold Mine are estimated to be about 3,812 thousand tonnes with an
average Au grade of 7.01 g/t, including approximately 385 thousand tonnes of Measured
Mineral Resources with an average Au grade of 5.88g/t, 2,146 thousand tonnes of Indicated
Mineral Resources with an average Au grade of 7.27 g/t, 1,281 thousand tonnes of Inferred
Mineral Resources with an average Au grade of 6.90 g/t. The Mineral Resources for Jintai Gold
Mine are estimated to be about 10,666 thousand tonnes with an average Au grade of 1.30 g/t,
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including approximately 3,363 thousand tonnes of Measured Mineral Resources with an
average Au grade of 1.68 g/t, 4,604 thousand tonnes of Indicated Mineral Resources with an
average Au grade of 1.02 g/t, 2,699 thousand tonnes of Inferred Mineral Resources with an
average Au grade of 1.29 g/t.
As of September 30, 2024, the Mineral Resources for our PRC Mines are estimated to be
about 18,893 thousand tonnes with an average Au grade of 4.12 g/t, including approximately
4,232 thousand tonnes of Measured Mineral Resources with an average Au grade of 3.26 g/t,
8,435 thousand tonnes of Indicated Mineral Resources with an average Au grade of 4.09 g/t,
6,226 thousand tonnes of Inferred Mineral Resources with an average Au grade of 4.75 g/t.
The following table, which is based on the Competent Person’s Report in accordance with
the JORC Code, sets forth the information of our gold Reserves in the PRC as of September 30,
2024:
Mineralized
Zone/Block Category Tonnage Au Grade
Au Metal
Contained
Au Metal
Contained
(kt) (g/t) (koz) (t)
Wulong Gold Mine /H1118/H1118Proved ––––
Probable 984 7.30 231 7.19
Total 984 7.30 231 7.19
Jilong Gold Mine /H1118/H1118/H1118Proved 510 9.81 161 5.00
Probable 409 7.38 97 3.02
Total 919 8.73 258 8.02
Huatai Gold Mine /H1118/H1118Proved 226 5.21 38 1.18
Probable 1,468 6.35 300 9.32
Total 1,694 6.20 338 10.50
Jintai Gold Mine /H1118/H1118/H1118Proved ––––
Probable 1,370 0.75 33 1.03
Total 1,370 0.75 33 1.03
Total
consolidated /H1118/H1118/H1118/H1118/H1118Proved 736 8.40 199 6.18
Probable 4,231 4.86 661 20.55
Total 4,967 5.38 860 26.73
Note:
1. Numbers have been subject to rounding. Accordingly, figures shown as totals in the table may not be
an arithmetic aggregation of the figures preceding them.
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As of September 30, 2024, the Probable Ore Reserves for Wulong Gold Mine are about
984 thousand tonnes with an average Au grade of 7.30 g/t. The Ore Reserves for Jinlong Gold
Mine are about 919 thousand tonnes with an average Au grade of 8.73 g/t, of which 510
thousand tonnes are Proved Ore Reserves with an average Au grade of 9.81 g/t, and 409
thousand tonnes are Probable Ore Reserves with an average Au grade of 7.38 g/t. The Ore
Reserves for Huatai Gold Mine are about 1,694 thousand tonnes with an average Au grade of
6.20 g/t, of which 226 thousand tonnes are Proved Ore Reserves with an average Au grade of
5.21 g/t, and 1,468 thousand tonnes are Probable Ore Reserves with an average Au grade of
6.35 g/t. The Probable Ore Reserves for Jintai Gold Mine are about 1,370 thousand tonnes with
an average Au grade of 0.75 g/t.
As of September 30, 2024, the Ore Reserves for PRC Mines are about 4,967 thousand
tonnes with an average Au grade of 5.38 g/t, of which 736 thousand tonnes are Proved Ore
Reserves with an average Au grade of 8.40 g/t, and 4,231 thousand tonnes are Probable Ore
Reserves with an average Au grade of 4.86 g/t.
Our Mineral Resources and Ore Reserves in Laos and Ghana
The following table, which is based on the Competent Person’s Report in accordance with
the JORC Code, sets forth the information of our gold Resources in Laos and Ghana as of
September 30, 2024:
Mineralized Zone/Block Category Tonnage Au Grade
Au Metal
Contained
Au Metal
Contained
(kt) (g/t) (koz) (t)
Sepon Gold and
Copper Mine –
Gold /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Measured 276 7.98 71 2.21
Indicated 7,220 4.13 958 29.80
Inferred 6,002 3.67 707 22.00
Total 13,498 4.00 1,736 54.01
Wassa Gold Mine /H1118/H1118Measured 6,754 2.97 646 20.08
Indicated 9,984 3.13 1,004 31.24
Inferred 60,893 3.38 6,609 205.53
Total 77,631 3.31 8,258 256.85
Total consolidated /H1118Measured 7,031 3.17 717 22.29
Indicated 17,203 3.55 1,962 61.03
Inferred 66,895 3.40 7,316 227.54
Total 91,129 3.41 9,995 310.86
Notes:
1. As to the Sepon Gold and Copper Mine and Wassa Gold Mine, the Mineral Resources include the
resources from open-pit, underground and stockpile.
2. Numbers have been subject to rounding. Accordingly, figures shown as totals in the table may not be
an arithmetic aggregation of the figures preceding them.
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As of September 30, 2024, the Mineral Resources for Sepon Gold and Copper Mine are
estimated to be about 13,498 thousand tonnes with an average Au grade of 4.00 g/t, including
approximately 276 thousand tonnes of Measured Mineral Resources with an average Au grade
of 7.98 g/t, 7,220 thousand tonnes of Indicated Mineral Resources with an average Au grade
of 4.13g/t, 6,002 thousand tonnes of Inferred Mineral Resources with an average Au grade of
3.67 g/t. The Mineral Resources for Wassa Gold Mine are estimated to be about 77,631
thousand tonnes with an average Au grade of 3.31 g/t, including approximately 6,754 thousand
tonnes of Measured Mineral Resources with an average Au grade of 2.97 g/t, 9,984 thousand
tonnes of Indicated Mineral Resources with an average Au grade of 3.13g/t, 60,893 thousand
tonnes of Inferred Mineral Resources with an average Au grade of 3.38 g/t.
As of September 30, 2024, the Mineral Resources for our overseas mines are estimated
to be about 91,129 thousand tonnes with an average Au grade of 3.41 g/t, including
approximately 7,031 thousand tonnes of Measured Mineral Resources with an average Au
grade of 3.17 g/t, 17,203 thousand tonnes of Indicated Mineral Resources with an average Au
grade of 3.55 g/t, 66,895 thousand tonnes of Inferred Mineral Resources with an average Au
grade of 3.40 g/t.
The following table, which is based on the Competent Person’s Report in accordance with
the JORC Code, sets forth the information of our gold Reserves in Laos and Ghana as of
September 30, 2024:
Mineralized Zone/Block Category Tonnage Au Grade
Au Metal
Contained
Au Metal
Contained
(kt) (g/t) (koz) (t)
Sepon Gold and
Copper Mine –
Gold /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Proved 268 4.70 41 1.26
Probable 7,628 3.05 749 23.30
Total 7,896 3.11 790 24.56
Wassa Gold Mine /H1118/H1118/H1118Proved 3,521 2.14 242 7.53
Probable 5,291 2.12 360 11.19
Stockpile 30 1.33 1.27 0.04
Total 8,842 2.12 603 18.76
Total consolidated /H1118Proved 3,790 2.32 283 8.79
Probable 12,918 2.67 1,109 34.49
Stockpile 30 1.33 1.27 0.04
Total 16,738 2.59 1,393 43.32
Notes:
1. As to the Sepon Gold and Copper Mine and Wassa Gold Mine, the Ore Reserves include the ore from
open pit, underground and stockpile.
2. Numbers have been subject to rounding. Accordingly, figures shown as totals in the table may not be
an arithmetic aggregation of the figures preceding them.
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As of September 30, 2024, the Ore Reserves for Sepon Gold and Copper Mine are about
7,896 thousand tonnes with an average Au grade of 3.11 g/t, of which 268 thousand tonnes are
Proved Ore Reserves with an average Au grade of 4.70 g/t, and 7,628 thousand tonnes are
Probable Ore Reserves with an average Au grade of 3.05 g/t. The Ore Reserves for Wassa Gold
Mine are about 8,842 thousand tonnes with an average Au grade of 2.12 g/t, of which 3,521
thousand tonnes are Proved Ore Reserves with an average Au grade of 2.14 g/t, 5,291 thousand
tonnes are Probable Ore Reserves with an average Au grade of 2.12 g/t, and 30 thousand tonnes
are Stockpile with an average Au grade of 1.33 g/t.
As of September 30, 2024, the Ore Reserves for our overseas mines are about 16,738
thousand tonnes with an average Au grade of 2.59 g/t, of which 3,790 thousand tonnes are
Proved Ore Reserves with an average Au grade of 2.32 g/t, 12,918 thousand tonnes are
Probable Ore Reserves with an average Au grade of 2.67 g/t, and 30 thousand tonnes are
Stockpile with an average Au grade of 1.33 g/t.
Our Other Mineral Resources and Ore Reserves in the PRC
The following table, which is based on the Competent Person’s Report in accordance with
the JORC Code, sets forth the information of our non-ferrous metal Resources in the PRC
conducted at subsidiary, Hanfeng Mining, which owns two mining areas, namely Lishan
Mining Area and Dongfeng Mining Area, as of September 30, 2024:
Lishan Mining Area Dongfeng Mining Area
Category Tonnage Zn Grade
Zn Metal
Contained Cu Grade
Cu Metal
Contained Pb Grade
Pb Metal
Contained Tonnage Mo Grade
Mo Metal
Contained
(kt) % (kt) % (kt) % (kt) (kt) % (kt)
Measured /H1118/H1118/H1118/H1118/H1118752 2.36 18 – – 0.12 1 1,819 0.11 2
Indicated /H1118/H1118/H1118/H1118/H11188,583 2.66 229 0.07 6 0.12 10 26,495 0.12 32
Inferred /H1118/H1118/H1118/H1118/H111810,616 2.90 308 0.09 10 0.13 14 37,053 0.12 45
Total /H1118/H1118/H1118/H1118/H1118/H1118/H111819,951 2.78 554 0.08 16 0.13 25 65,367 0.12 79
Note:
1. Numbers have been subject to rounding. Accordingly, figures shown as totals in the table may not be an
arithmetic aggregation of the figures preceding them.
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The following table, which is based on the Competent Person’s Report in accordance with
the JORC Code, sets forth the information of our non-ferrous metal Reserves in the PRC
conducted at subsidiary, Hanfeng Mining, which owns two mining areas, namely Lishan
Mining Area and Dongfeng Mining Area, as of September 30, 2024:
Lishan Mining Area
Category Tonnage Zn Grade
Zn Metal
Contained
(kt) (%) (kt)
Proved /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118390 2.26 9
Probable /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,920 2.47 72
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,310 2.45 81
Notes:
1. Numbers have been subject to rounding. Accordingly, figures shown as totals in the table may not be an
arithmetic aggregation of the figures preceding them.
2. It should be noted that only the Lishan Lower Part (Stage 1) is included in the Ore Reserves, as there are
insufficient technical studies regarding the Lishan Lower Part (Stage 2) and the Dongfeng Lower Part. In order
to classify as Proved or Probable Ore Reserve category, technical studies need to be completed to at least a
PFS level with an appraisal of how access would be achieved, mining methodology (including extraction and
dilution factors), the geotechnical understanding as well as ventilation. Along with the technical understanding
and extraction achievability, the economics of each area needs to be proved, i.e. with the application of Capex
and Opex, is it economic to mine, cash flow positive.
Our Mineral Resources and Ore Reserves in Laos
The following table, which is based on the Competent Person’s Report in accordance with
the JORC Code, sets forth the information of our copper Resources in Laos conducted at our
subsidiary, LXML, as of September 30, 2024:
Mineralized Zone/Block Category Tonnage Cu Grade
Cu Metal
Contained
(kt) (%) (kt)
Sepon Gold and Copper
Mine – Copper /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Measured – – –
Indicated 4,416 1.45 64
Inferred 2,078 0.98 20
Total 6,493 1.30 85
Note:
1. Numbers have been subject to rounding. Accordingly, figures shown as totals in the table may not be
an arithmetic aggregation of the figures preceding them.
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The following table, which is based on the Competent Person’s Report in accordance with
the JORC Code, sets forth the information of our copper Reserves in Laos conducted at our
subsidiary, LXML, as of September 30, 2024:
Mineralized Zone/Block Category Tonnage Cu Grade
Cu Metal
Contained
(kt) (%) (kt)
Sepon Gold and Copper
Mine – Copper /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Proved – – –
Probable 1,185 0.93 11.05
Total 1,185 0.93 11.05
Note:
1. Numbers have been subject to rounding. Accordingly, figures shown as totals in the table may not be
an arithmetic aggregation of the figures preceding them.
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Our Gold Production Volume
The following table sets forth our ore mined volume, ore processed volume and mine production volume in relation to our gold mining
businesses for the periods indicated:
Y ear Ended December 31, Nine Months Ended September 30,
2023
Nine Months Ended September 30,
20242021 2022 2023
Ore
Mined
Ore
Processed
Gold
Production
Processing
Capacity
Utilisation 1
Rate
Ore
Mined
Ore
Processed
Gold
Production
Processing
Capacity
Utilisation 1
Rate
Ore
Mined
Ore
Processed
Gold
Production
Processing
Capacity
Utilisation 1
Rate
Ore
Mined
Ore
Processed
Gold
Production
Processing
Capacity
Utilisation 1
Rate
Ore
Mined
Ore
Processed
Gold
Production
Processing
Capacity
Utilisation 1
Rate
(kt) (kt) (koz) (kt/a) (kt) (kt) (koz) (kt/a) (kt) (kt) (koz) (kt/a) (kt) (kt) (koz) (kt/a) (kt) (kt) (koz) (kt/a)
Wulong Gold Mine 6 /H1118/H1118/H1118/H1118383 383 28.0 400 96% 389 423 43.8 1,000 42% 577 578 59.2 1,000 58% 444 401 40.3 750 53% 529 514 47.5 750 69%
Jilong Gold Mine 1, 6 /H1118/H1118/H1118 138 146 34.3 120 122% 153 156 29.5 120 130% 155 155 44.7 120 129% 110 112 31.2 90 124% 161 168 27.5 170 99%
Huatai Gold Mine 2, 6 /H1118/H1118/H1118 56 60 4.9 60 100% 18 19 1.3 60 32% 1 2 0.5 60 3% 1 2 1.5 45 4% – – – 45 –
Jintai Gold Mine 3/H1118/H1118/H1118/H1118/H1118 – – – – – – – – 122 122 2.4 140 88% – – – 0 – 459 459 6.6 360 100%
Sepon Gold and Copper
Mine – Gold 4, 6 /H1118/H1118/H1118/H11184,237 3,407 193.0 3,800 90% 3,794 3,792 199.5 3,800 100% 2,790 3,085 193.2 3,800 81% 1,787 2,457 140.9 2,850 86% 1,890 2,355 125.9 2,850 83%
Wassa Gold Mine 5, 6 /H1118/H1118/H1118 – – – – – 2,024 1,969 162.1 2,700 73% 2,530 2,551 161.5 2,700 94% 1,920 1,850 116.1 2,025 91% 2,211 2,300 138.1 2,025 114%
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,814 3,996 260.2 4,380 91% 6,378 6,359 436.2 7,680 83% 6,175 6,493 461.5 7,820 83% 4,262 4,822 330.0 5,760 84% 5,250 5,796 345.6 6,200 92%
Notes:
1. Utilization rate is calculated by dividing the amount of ore processed by the processing capacity. For some of the periods, the utilisation rate wer e over 100%. This was mainly
because the relevant processing plants actually operated for more days than the planned schedule as the annual maintenance work took less than the ant icipated time.
2. The ore mined, ore processed, gold production, processing capacity and utilisation rate of Huatai Gold Mine began to decline since 2021. This is mai nly because the technical
renovation and expansion project of Huatai Gold Mine commenced in 2021. Since then, the production of Huatai Gold Mine gradually declined due to the im pact from the
engineering upgrades. For more details regarding the year-to-year comparison of the gold production volume, please refer to “— Our Gold Production B usiness in China —
Overview — Operation Performance”.
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3. In January 2023, we completed the acquisition of a 51% equity interest in Xinhenghe Mining, which in turn directly holds a 90% equity interest in Jint ai Mining, which runs
Jintai Gold Mine, and we began consolidating the accounts of Jintai Mining from January 31, 2023. As such, ore mined volume, ore processed volume and mi ne production
volume of the Jintai Gold Mine prior to January 31, 2023 was not included in our Group. For more details, please see “Financial Information — Key Factors Affecting Our
Results of Operations — Acquisitions — Acquisition of Xinhenghe Mining.”
4. The volume of the ore mined of Sepon Gold and Copper Mine declined over the Track Record Period, mainly because we were upgrading the mining systems of Sepon Gold
and Copper Mine to enhance the capacity, which affected the mining operations, and we have utilised part of the ore inventory which were mined in past pe riods. The volume
of ore processed decreased as Sepon Gold and Copper Mine started underground mining in 2023 and the underground operation provides higher grade ore bu t with smaller
volume. For more details regarding the year-to-year comparison of the gold production volume, please refer to “— Our Gold Production Business in Laos — Overview —
Operation Performance”.
5. In January 2022, we acquired a 62% equity interest in Golden Star Resources, which in turn indirectly holds a 90% equity interest in GSWL, and we began consolidating the
accounts of Golden Star Resources from February 1, 2022. As such, ore mined volume, ore processed volume and mine production volume of the Wassa Gold Mi ne prior to
February 1, 2022 was not included in our Group. For more details, please see “Financial Information — Key Factors Affecting Our Results of Operations — Acquisitions —
Acquisition of Golden Star Resources.”
6. For some of the years, the volume of “ore processed” was higher than the volume of “ore mined.” This was mainly because some of the ore mined during the p revious year
was kept as inventory and was processed in the following year which added up to the aggregated amount of the “ore processed” for that year.
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Our Gold Operating Costs
Our operational efficiency enhancement surpassed the worldwide industry average by a
notable margin and we positioned lower in terms of gold AISC than that of the global average.
As of December 31, 2023, our gold AISC stood at only US$1,179.1 per ounce, placing us in
the first quartile in the worldwide industry, while the global average for the same period was
approximately US$1,348.5, or 14.4% higher than that of ours. In 2023, we decreased our gold
AISC by 12.0%, whereas the average AISC for international gold producers increased by 7.2%
during the same period. Set forth below is our gold AISC and the global average for the periods
indicated:
Y ear Ended December 31,
Changes from
Y ear Ended
December 31,
2022 to
Y ear Ended
December 31,
2023
Nine Months
Ended
September 30,
20242022 2023
US$/ounce % US$/ounce
PRC Gold Mines /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,205.7 877.4 (27.2) 1,008.5
Sepon Gold and Copper
Mine /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,476.9 1,330.0 (9.9) 1,408.3
Wassa Gold
Mine /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,371.2 1,197.1 (12.7) 1,240.8
Our Group /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,340.0 1,179.1 (12) 1,249.2
Global Average /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,258.1 1,348.5 7.2 1,498.8
Note:
1. Company started to make voluntary disclosure of AISC since the year of 2022, in align with global
industrial reporting practice.
The global average AISC has increased from US$1,348.5/ounce for the year ended
December 31, 2023 to US$1,498.8/ounce for the nine months ended September 30, 2024. This
was primarily due to the ongoing rise in labor costs globally. In addition, driven by the rising
gold price, gold mining companies started to process lower-grade ores which led to higher
mining costs.
The AISC of our Group increased from US$1,179.1/ounce for the year ended December
31, 2023 to US$1,249.2/ounce for the nine months ended September 30, 2024. This was mainly
because (i) the production volume of LXML for the third quarter of 2024 fell short of our
expectations due to the impact of typhoons and floods, resulting in an inability to spread labor
and depreciation costs; and (ii) labor costs and raw materials costs increased driven by global
inflation.
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Our Other Mineral Resources Production Volume
The following table sets forth the ore mined volume, ore processed volume and mine
production volume in relation to our other Mineral Resources businesses for the periods
indicated:
Y ear Ended December 31,
Nine Months
Ended
September 30,
2023
Nine Months
Ended
September 30,
20242021 2022 2023
(kt) (kt) (kt) (kt) (kt)
Ore Mined
Hanfeng Polymetallic Mine
– Polymetallic metals /H1118/H1118/H1118510 502 457 247 549
Sepon Gold and Copper
Mine – Copper
cathodes
1 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181 4 9 – –––
Ore Processed
Hanfeng Polymetallic Mine
– Polymetallic metals /H1118/H1118/H1118506 579 434 220 534
Sepon Gold and Copper
Mine – Copper cathodes /H1118 255 772 1,105 802 843
Processing Capacity
Hanfeng Polymetallic Mine
– Polymetallic metals /H1118/H1118660 660 660 500 675
Sepon Gold and Copper
Mine – Copper cathodes
1 260 800 1,150 850 850
Utilisation Rate 2
Hanfeng Polymetallic Mine
– Polymetallic metals /H1118/H1118/H111877% 88% 66% 44% 79%
Sepon Gold and Copper
Mine – Copper cathodes /H1118 98% 97% 96% 94% 99%
Production Volume
Hanfeng Polymetallic Mine
Zinc concentrate
powder /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819.93 22.04 11.29 5.55 10.18
Lead concentrate
powder /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183.48 3.31 2.72 1.43 2.63
Copper concentrate
powder /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.93 2.05 1.44 0.63 1.19
Molybdenum concentrate
powder
3 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 0.04 0.21 0.07 0.49
Sepon Gold and Copper
Mine – Copper cathodes /H1118 5.02 6.43 6.49 4.94 4.03
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Notes:
1. The ore mined volume for the Sepon Gold and Copper Mine’s copper mine dropped to zero in 2022,
because the Sepon Gold and Copper Mine resumed gold production in 2020, while only keeping a small
portion of processing capacity for its copper business since then. For the reason behind the halt in gold
production at the copper mine of the Sepon Gold and Copper Mine, please refer to “Business — Our
Gold Production Business in Laos — Overview.” As of the Latest Practicable Date, the Sepon Gold and
Copper Mine did not have any active copper mining projects while only processed the ore from its
stockpile.
2. Utilization rate is calculated by dividing the amount of ore processed by the processing capacity. This
was because the relevant processing plants actually operated for more days than the planned schedule
as the annual maintenance work took less than the anticipated time.
3. There was no molybdenum production volume for the year of 2021, mainly because the Dongfeng Mine
was conducting exploration and had not yet initiated molybdenum mining activities.
Our Revenue Breakdown
During the Track Record Period, we generated revenue from the PRC, Laos and Ghana.
The following table sets forth a breakdown of our revenue by origin of our products for the
periods indicated:
Y ear Ended December 31, Nine Months Ended
September 30, 20242021 2022 2023
RMB’000 % RMB’000 % RMB’000 % RMB’000 %
PRC /H1118/H1118/H1118/H11181,259,688 33.3 1,477,471 23.5 2,026,833 28.1 1,793,374 28.8
Laos /H1118/H1118/H1118/H11182,522,936 66.7 2,998,740 47.9 3,054,614 42.3 2,327,466 37.4
Ghana /H1118/H1118/H1118 – – 1,790,576 28.6 2,139,505 29.6 2,101,991 33.8
Total/H1118/H1118/H1118/H11183,782,624 100.0 6,266,787 100.0 7,220,952 100.0 6,222,831 100.0
Notes:
1. Our revenue in Ghana was generated from Golden Star Resources. In January 2022, we acquired a 62% equity
interest in Golden Star Resources, which in turn indirectly holds a 90% equity interest in GSWL, and we began
consolidating the accounts of Golden Star Resources from February 1, 2022. As such, the revenue of GSWL
prior to February 1, 2022 was not included in our Group. For more details, please see “Financial Information
— Key Factors Affecting Our Results of Operations — Acquisitions — Acquisition of Golden Star Resources”.
2. Our gold products are sold globally. Our major clients are refineries primarily located in PRC, Thailand,
Australia, Singapore, South Africa and Ghana.
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During the Track Record Period, we generated our revenue primarily from gold mining,
other Mineral Resources and other businesses. The following table sets forth the breakdown of
our revenue by business segments for the periods indicated:
Y ear Ended December 31, Nine Months Ended
September 30, 20242021 2022 2023
RMB’000 % RMB’000 % RMB’000 % RMB’000 %
Gold
mining /H11182,968,694 78.5 5,304,729 84.6 6,322,263 87.6 5,561,259 89.4
Other
Mineral
Resources /H1118551,278 14.6 650,206 10.4 495,752 6.9 454,130 7.3
Others /H1118/H1118/H1118262,652 6.9 311,852 5.0 402,937 5.5 207,442 3.3
Total/H1118/H1118/H1118/H11183,782,624 100.0 6,266,787 100.0 7,220,952 100.0 6,222,831 100.0
Note:
1. “Others” primarily comprised recycling of waste electronic products and electrical appliances business
conducted through Guangyuan Technology.
OUR GOLD PRODUCTION BUSINESS IN CHINA
Overview
We have four subsidiaries conducting gold production business in the PRC, namely
Wulong Mining, Jilong Mining, Huatai Mining and Jintai Mining.
Wulong Mining
Wulong Mining was established in April 2008 and was 100% acquired by us in November
2013. The mining areas of the Wulong Gold Mine are located at Zhen An District, Dandong
City, Liaoning Province. The Wulong Gold Mine has three active underground mining areas.
As of the Latest Practicable Date, Wulong Mining held one valid mining license which covered
an area of approximately 6.27 km
2 and two valid exploration permits which covered an area
of approximately 4.49 km 2. The major product of the Wulong Gold Mine is gold concentrate
powder with gold content of 50g/t and more.
Development and Expansion
Wulong Gold Mine has identified several gold mineralised areas in its mining area and
its peripheral areas, a precursor of exploration and Reserve enhancement in its deep and
peripheral areas. It is advancing multiple underground development projects to increase its
annual processing capacity from 578,000 tonnes to approximately 700,000 tonnes by the end
of 2024. The mine’s average daily processing capacity increased to over 1,800 tonnes in the
second half of 2023. It will continue to invest in exploration and Reserve enhancement at the
mine to tap into the potential of Resources in the deep and peripheral areas.
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In addition, Wulong Mining has participated in certain research projects. Wulong Gold
Mine is in the southwest of Liaodong — Jinan polymetallic metallogenic gold belt and is the
key research mine for the “Liaodong — Tonghua Ultra-large Gold Metallogenic Belt” (“؇
–ϓᘤ੭”) national project. As such, the Wulong Gold Mine was designated as a
key target area for exploration as well as a strategic gold production base on a national level
by the 21st Century Agenda Management Centre of the Ministry of Science and Technology (߅
ኪҦஔ௅21ᙄ೻၍ଣʕː) of the PRC.
To better evaluate the Resources of the Wulong Gold Mine, in July 2016, Wulong Mining
participated in the national key research and development program of “Three-dimensional
Structure and Ore Formation Prediction of Complex Ore Formation System in Liaodong” ( ፱
ልᕏϓᘤӻ୕ɧၪഐ࿴ၾϓᘤཫ಻) initiated by the Ministry of Science and Technology of
the PRC and led by the Institute of Geology and Geophysics of the Chinese Academy of
Science (ה.)
In August 2018, Wulong Mining participated in the downstream project of
“Demonstration of Prediction and Deep Exploration of Gold Polymetallic Ore in the Important
Mineralised Zone of North China Kraton Liaodong/Jiaodong” (؇/ϓᘤ
ͪᇍ) led by the Development Research Centre of the China
Geological Survey (Ӻʕː) in order to research the relevant mining
area of the Wulong Gold Mine. A 3,000 meters in-depth drilling project at the Wulong Gold
Mine was undertaken in May 2021, which was the first deep-hole drill for non-coal solid
minerals in Northeast China. This project resulted in the discovery of four gold mineralisation
areas, three gold mineralization bodies, two zinc mineralisation areas and one zinc mineralized
body. In response to these findings, we have increased investments in the Wulong Gold Mine
and implemented a technical transformation of the mine engineering in order to carry out a
strategic expansion of the scale of the mine. We have also entered into Cooperation framework
agreement with China Geological Survey Bureau Shenyang Geological Survey Center, which
is expected to strengthen our exploration foundation.
Jilong Mining
Jilong Mining was established in October 2005, and it acquired 100% interest in the
Jilong Gold Mine (also known as Zhuanshanzi Gold Mine (ᘤ)) from the state
authorities of the PRC. The mining areas of the Jilong Gold Mine are located at Sidaowanzi
Town, Aohan County, Chifeng City, Inner Mongolia Autonomous Region. The Jilong Gold
Mine has three active underground mining areas. According to Frost & Sullivan, the
Zhuanshanzi mining area is located on one of the most important major gold metallogenic belts
in China with high grade ores. As of the Latest Practicable Date, Jilong Mining held two valid
mining licenses and one valid exploration permit, which covered an aggregate area of
approximately 17.7 km
2 and 3.8 km 2. The major product of the Jilong Gold Mine is doré with
gold content of over 80%.
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Development and Expansion
The Jilong Gold Mine has undertaken drilling projects in both peripheral and deep areas,
yielding promising results such as the discovery of industrial mineralisation areas in 6 drill
holes. It has completed the 180,000-tonne gold ore processing plant expansion project, and trial
production has commenced since June 2024. We plan to increase annual mining capacity to
approximately 300,000 tonnes by the end of 2025. Additionally, it started construction of a new
tailings storage facility in November 2023, with other construction projects progressing as
planned. We have entered into a framework agreement with Aohanqi Longxing Resources
Development Company Limited, and this cooperation is expected to expand our exploration
area.
Huatai Mining
Huatai Mining was established in January 2005, and it acquired 100% interest in the
Huatai Gold Mine (also known as Honghuagou Gold Mine (ᘤ)) from the state
authorities of the PRC. The mining areas of Huatai Gold Mine are located at Wang Fu Town,
Song Shan District, Chifeng City, Inner Mongolia Autonomous Region. As of the Latest
Practicable Date, the Huatai Gold Mine held six valid mining licenses which covered an
aggregate area of approximately 10.5 km
2, respectively. The major product of the Huatai Gold
Mine is doré with gold content of over 65%.
Development and Expansion
Due to the limited production capacity specified in the mining licenses of the Huatai Gold
Mine, it is incapable of executing large-scale mining activities. Therefore, since 2022 we have
been strategizing and drafting plans for expanding and enhancing the capacity of various
mining zones within the Huatai Mining’s mining permits. As of the Latest Practicable Date,
preliminary designs for capacity expansion initiatives in certain mining areas had been
finalized and approved by the local authority, and the mine is in the process of selecting
construction contractors. We expect the Huatai Gold Mine will initiate a comprehensive
transformation of the mine’s infrastructure and commence shaft engineering construction in
2024. Infrastructure development is projected to be substantially completed by the end of 2025.
Upon completion, we expect to resume production in the beginning of 2026, subject to final
approvals from relevant governmental authorities, and increase the Huatai Gold Mine’s annual
mining capacity by an additional 30,000 tonnes. As a result of the construction, mining
activities at the Huatai Gold Mine were affected for the years ended December 31, 2022 and
2023 and the nine months ended September 30, 2024.
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Jintai Mining
On January 8, 2023, we completed the acquisition of 51% equity interest in Xinhenghe
Mining, which in turn directly holds a 90% equity interest in the Jintai Gold Mine. The mining
areas of Jintai Mining are located at Xidengping, Eryuan County, Dali City, Y unnan Province,
China. As of the Latest Practicable Date, Jintai Mining held one valid mining license and one
valid exploration permit, which covered an aggregate area of approximately 1.09 km
2 and
10.28 km 2, respectively. The major product of the Jintai Gold Mine is gold-loaded carbon.
Development and Expansion
In October 2023, we completed the construction project at the Jintai Gold Mine with its
annual mining and processing capacity of approximately 140,000 tonnes. Since 2024, we
commenced a further expansion project of the Jintai Gold Mine, pursuant to which the
Xidengping mining area is expected to reach an annual mining and processing capacity of
approximately 50,000 tonnes, and the Tangzibian mining area is expected to reach an annual
mining and processing capacity of approximately 600,000 tonnes.
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Operation Performance
During the Track Record Period, our gold mining business in the PRC produced 67.2 koz, 74.6 koz, 106.8 koz and 82 koz of gold, respectively.
The following table sets forth the ore mined volume, ore processed volume and mine production volume of the Wulong Gold Mine, Jilong Gold Mine,
Jintai Gold Mine and Huatai Gold Mine for the periods indicated.
Y ear Ended December 31, Nine Months Ended September 30,
2023
Nine Months Ended September 30,
20242021 2022 2023
Ore
Mined
Ore
Processed
Gold
Production
Processing
Capacity
Utilisation
Rate
Ore
Mined
Ore
Processed
Gold
Production
Processing
Capacity
Utilisation
Rate
Ore
Mined
Ore
Processed
Gold
Production
Processing
Capacity
Utilisation
Rate
Ore
Mined
Ore
Processed
Gold
Production
Processing
Capacity
Utilisation
Rate
Ore
Mined
Ore
Processed
Gold
Production
Processing
Capacity
Utilisation
Rate
(kt) (kt) (koz) (kt/a) (kt) (kt) (koz) (kt/a) (kt) (kt) (koz) (kt/a) (kt) (kt) (koz) (kt/a) (kt) (kt) (koz) (kt/a)
Wulong Gold Mine /H1118/H1118/H1118/H1118383 383 28.0 400 96% 389 423 43.8 1,000 42% 577 578 59.2 1,000 58% 444 401 40.3 750 53% 529 514 47.5 750 69%
Jilong Gold Mine /H1118/H1118/H1118/H1118138 146 34.3 120 122% 153 156 29.5 120 130% 154 155 44.7 120 129% 110 112 31.2 90 124% 161 168 27.5 170 99%
Huatai Gold Mine /H1118/H1118/H1118/H111856 60 4.9 60 100% 18 19 1.3 60 32% 1 2 0.5 60 3% 1 2 1.5 45 4% – – – 45 –
Jintai Gold Mine 1 /H1118/H1118/H1118/H1118– – – – – – – – – – 122 122 2.4 140– 88% – – – 0 – 459 459 6.6 360 100%
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118577 589 67.2 580 102% 560 598 74.6 1,180 51% 854 857 106.8 1,320 65% 555 515 73.0 885 58% 1,149 1,141 81.6 1,325 79%
1. In January 2023, we completed the acquisition of a 51% equity interest in Xinhenghe Mining, which in turn directly holds a 90% equity interest in Jint ai Mining, which runs
Jintai Gold Mine, and we began consolidating the accounts of Jintai Mining from January 31, 2023. As such, ore mined volume, ore processed volume and mi ne production
volume of Jintai Gold Mine prior to January 31, 2023 was not included in our Group. For more details, please see “Financial Information — Key Factors Aff ecting Our Results
of Operations — Acquisitions — Acquisition of Xinhenghe Mining.”
2. For some of the years, the volume of “ore processed” was higher than the volume of “ore mined.” This was mainly because some of the ore mined during the p revious year
was kept as inventory and processed in the following year which added up to the aggregated amount of the “ore processed” for that year.
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The gold production volume of the Wulong Gold Mine increased by 56.4% from 28.0 koz
in 2021 to 43.8 koz in 2022. This was primarily due to (i) the completion of our technological
upgrade and (ii) improvement in our mining and processing capacity and ore grade. Its gold
production volume further increased by 35.1% from 43.8 koz in 2022 to 59.2 koz in 2023. This
was primarily due to the completion of our technological upgrade and improvement in our
mining and processing capacity and ore grade. The gold production volume of the Wulong Gold
Mine increased by 17.5% from 40 koz as of September 30, 2023 to 47 koz as of September 30,
2024. This was primarily due to gold ore processing volume increased compared with the same
period of last year.
The gold production volume of the Jilong Gold Mine decreased by 14.0% from 34.3 koz
in 2021 to 29.5 koz in 2022. This was primarily due to deterioration of the ore grade. Its gold
production volume increased by 51.5% from 29.5 koz in 2022 to 44.7 koz in 2023. This was
primarily attributed to its relatively high-level gold grade and steady expansions. The gold
production volume of the Jilong Gold Mine decreased by 9.7% from 31.2 koz as of September
30, 2023 to 27.5 koz as of September 30, 2024. This was primarily due to average Au grade
of gold ore processed declines compared with the same period of last year.
The gold production volume of the Huatai Gold Mine decreased by 73.5% from 4.9 koz
in 2021 to 1.3 koz in 2022, then decreased by 61.5% to 0.5 koz in 2023, and further decreased
to nil in nine months ended September 30, 2024. The gold production volume of the Huatai
Gold Mine decreased by 100.0% from 1 koz as of September 30, 2023 to nil as of September
30, 2024. These changes were primarily due to production halted for the first three quarters of
the year as the mine is undergoing technology upgrades for expansion of production capacity,
which affected the mine’s production.
The Jintai Gold Mine was acquired by us in January 2023. The gold production volume
of the Jintai Gold Mine was 2.4 koz and 6.6 koz in 2023 and in the nine months ended
September 30, 2024, respectively, because its gold production was in the early stage and
ramping up.
The following table sets forth the processing recovery rate of the Wulong Gold Mine,
Jilong Gold Mine, Huatai Gold Mine and Jintai Gold Mine for the periods indicated.
Y ear Ended December 31,
Nine Months
Ended
September 30,
20242021 2022 2023
Wulong Gold Mine /H1118/H1118/H1118/H1118/H1118/H1118/H111889.7% 89.8% 91.3% 91.0%
Jilong Gold Mine /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111897.1% 96.2% 97.7% 95.5%
Huatai Gold Mine /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111893.8% 93.4% 92.8% –
Jintai Gold Mine /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 87.2% 87.4%
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We began processing ores from low-grade materials in 2020 based on the result of an
internal economic analysis, which took into account factors like the rise of the gold price and
the encouraging policies in the PRC. We believe the low-grade materials, such as residues and
stockpiles, would start to gain economic value, and the comprehensive utilisation of such
materials will help us increase our revenue and achieve economies of scale.
The PRC Legal Advisor is of the view that the utilisation of the low-grade materials
would not constitute non-compliance under the applicable PRC laws and regulations, on the
following basis:
(i) in accordance with the Article 30 of the Mineral Resources Law of the People’s
Republic of China (2009 Revision), the minerals with industrial value that occur in
association with or as by-products of the ordinary mineral production should be
subject to unified planning, comprehensive mining, and integrated utilization to
prevent waste; and
(ii) our Group’s utilisation of the low-grade materials falls within the scope of “unified
planning, comprehensive mining, and integrated utilization” of minerals with
industrial value that occur in association or as by-products of the ordinary mineral
production.
The PRC Legal Advisor is of the view that the actual volume of materials produced being
higher than the amount stipulated in the mining licenses would not be deemed as an excess over
the relevant production capacity specified in its mining licences as the excessive amount could
be attributable to comprehensive utilisation of the low-grade materials, which is encouraged by
relevant regulations and does not fall within the scope of mined resources and reserves under
the mining license.
The actual volume of materials produced by Jilong Gold Mine, which represents the
aggregated amount of the stope production and comprehensive utilisation, was 138kt, 153kt
and 155kt for the years ended December 31, 2021, 2022 and 2023, respectively. These volumes
were 18kt, 33kt and 35kt higher than the then annual production capacity of 120kt specified
in the mining license for the respective periods. For the four months from January 2024 to April
2024, the actual amount of materials produced was 49.53kt, which was 9.53kt higher, on a
pro-rata basis, than the then annual production capacity of 120kt specified in the then mining
license. We obtained the updated mining license with annual production capacity of 180kt on
May 1, 2024. For the five months from May 2024 to September 2024, our actual amount of
materials produced was 111.08kt, which was 36.08kt higher, on a pro-rata basis, than the
annual production capacity of 180kt specified in the updated mining license. However, none of
the stope production amounts exceeded the annual production capacity specified in the mining
license.
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The actual volume of materials produced by Wulong Gold Mine, which represents the
aggregated amount of the stope production and the comprehensive utilisation, was 383kt,
389kt, 577kt and 529kt for the years ended December 31, 2021, 2022 and 2023 and the nine
months ended September 30, 2024, respectively. These volumes were 283kt, 289kt, 477kt and
429kt higher than the annual production capacity of 100kt in the mining license for the
respective periods, but none of the stope production amounts exceeded the annual production
capacity specified in the mining license.
The PRC Legal Advisor is of the view that we are not required to obtain any additional
mining licences, permits or certificates for its current/planned scale of operation on the
following basis:
(i) the amount stipulated in the mining licenses does not represent the actual permitted
mining scale of the mines, and the comprehensive utilization of low-grade materials
is encouraged by regulations; and
(ii) no laws, regulations, or regulatory documents in respect of mining in the PRC have
explicitly stated the legal liabilities for tonnage of materials processed of ores being
higher than the amount stipulated in the mining licenses.
The volume of ore mined of Jintai Gold Mine was 459kt for the nine months ended
September 30, 2024. The volume was 319kt higher than the annual production capacity of
140kt specified in the mining license for the respective period. The actual tonnage processed
of the Jintai Gold Mine for the nine months ended September 30, 2024 exceeded its permitted
annual processing capacity and designed mining capacity due to the following reasons:
(a) during the mining of the V1 orebody of the Phase I project of Jintai Gold Mine, we
discovered some mineralized waste. As the gold price increased, we conducted
economic analysis and believed that such mineralized waste had economic value.
Therefore, we processed such mineralized waste for comprehensive utilization, thus
increasing the production volume of Jintai Gold Mine; and
(b) we have been expanding the production site of the Phase II project of Jintai Gold
Mine. According to the development and construction plan, the designed scope of
land for the expanded production site of the Phase II project overlaps with the land
where the V1 ore body of the Phase I project is located. Therefore, it is necessary
to accelerate the mining of the V1 orebody of the Phase I project to make space for
the expanded production site of the Phase II project, which further contributed to the
increased production volume of Jintai Gold Mine.
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The PRC Legal Advisor is of the view that the excessive scale of production shortly after
our Group’s acquisition of Jintai Gold Mine in 2023 over the amount stipulated on the mining
licenses and our operation of Jintai Gold Mine does not constitute a material non-compliance
under the the laws and regulations in the PRC on the following basis:
(i) in accordance with the Article 30 of the Mineral Resources Law of the People’s
Republic of China (2009 Revision), the minerals with industrial value that occur in
association with or as by-products of the ordinary mineral production should be
subject to unified planning, comprehensive mining, and integrated utilization to
prevent waste. Our Group’s utilization of the mineralized waste falls within the
scope of “unified planning, comprehensive mining, and integrated utilization” of
minerals with industrial value that occur in association with or as by-products of the
ordinary mineral production;
(ii) since March 2017, the change of production scale is no longer accepted as an
administrative approval item. On February 22, 2022, the Natural Resources
Department of the Inner Mongolia Autonomous Region issued the “Notice on the
Update of the Production Scale Indicated on the Mining License”, which stipulates
that amount stipulated in the mining licenses only represents the scale at the time of
the initial registration of the mining license or the scale updated during the most
recent registration of the mining license. It is no longer used as the basis for
reviewing the production scale of the mining license. Therefore, the amount
stipulated in the mining licenses does not represent the actual permitted mining scale
of the company. Based on the above, the PRC Legal Advisor is of the view that the
amount stipulated in the mining licenses does not represent the actual scale that the
company can mine;
(iii) moreover, no laws, regulations, or regulatory documents in respect of mining in PRC
have explicit stated the legal liabilities of enterprises with the actual volume of ores
produced being higher than the amount stipulated in the mining licenses;
(iv) Natural Resources Bureau of Eryuan County has issued the certificate of
compliance, which confirmed that the exploration and mining activities of Jintai
Mining in where it has operation during the Track Record Period were in compliance
with the laws, regulations, or other regulatory documents;
(v) the Eryuan Branch of the Dali Bai Autonomous Region Ecological Environment
Bureau issued a compliance certificate, confirming that Jintai Mining’s production
and operation during the reporting period were in compliance with environmental
protection laws, regulations, and other regulatory documents. All currently
operating and under-construction projects have undergone environmental impact
assessments as required and have adhered to relevant environmental protection
regulations and requirements, the environmental protection facilities are complete
and are functioning properly, the discharge of major pollutants meets the national
standards for pollutant emissions; and
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(vi) the Emergency Management Bureau of Eryuan County has issued a compliance
certificate, confirming that Jintai Mining has complied with the relevant laws,
regulations, and regulatory documents on safety production management during the
Track Record Period and meets the conditions for safe production.
Our Directors have used their best endeavors to ensure that our Group’s business and
operations are conducted in a law-abiding and compliant manner through the following means:
(a) consulting our legal advisors in the PRC from time to time on various legal related
matters during the ordinary course of our business to make sure our business
operations are conducted in compliance with applicable laws and regulations;
(b) attending training on directors’ duties and obligations provided by our Hong Kong
legal advisor and keeping abreast of the latest developments in laws and regulations
relevant to our business and industry;
(c) attending board meetings to ensure that significant decisions of our Company during
the ordinary course of our business comply with laws, regulations, and articles of
association of our Company; and
(d) directing each level of various departments to hold meetings on a regular basis by
discussing issues pertaining to business operations and future development, and
ensuring that the operations and management of our Group are under the oversight
and supervision of the management team.
Mineral Resources and Ore Reserves
The following table, which is based on the Competent Person’s Report in accordance with
the JORC Code, sets forth the information of our Mineral Resources of the Wulong Gold Mine,
Jilong Gold Mine, Huatai Gold Mine and Jintai Gold Mine as of September 30, 2024:
Mineralized Zone/Block Category Tonnage Au Grade
Au Metal
Contained
Au Metal
Contained
(kt) (g/t) (koz) (t)
Wulong Gold Mine /H1118/H1118/H1118Measured ––––
Indicated 1,261 8.17 332 10.30
Inferred 1,738 7.21 402 12.53
Subtotal 2,999 7.61 734 22.83
Jilong Gold Mine /H1118/H1118/H1118/H1118Measured 484 12.19 190 5.90
Indicated 424 9.25 126 3.92
Inferred 508 9.24 151 4.70
Subtotal 1,415 10.25 467 14.51
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Mineralized Zone/Block Category Tonnage Au Grade
Au Metal
Contained
Au Metal
Contained
(kt) (g/t) (koz) (t)
Huatai Gold Mine /H1118/H1118/H1118/H1118Measured 385 5.88 73 2.27
Indicated 2,146 7.27 502 15.60
Inferred 1,281 6.90 284 8.83
Subtotal 3,812 7.01 859 26.71
Jintai Gold Mine /H1118/H1118/H1118/H1118/H1118Measured 3,363 1.68 181 5.64
Indicated 4,604 1.02 155 4.70
Inferred 2,699 1.29 112 3.49
Subtotal 10,666 1.30 444 13.82
Total consolidated /H1118/H1118/H1118/H1118Measured 4,232 3.26 444 13.80
Indicated 8,435 4.09 1,110 34.52
Inferred 6,226 4.75 949 29.55
Total 18,893 4.12 2,503 77.87
Note:
1. Numbers have been subject to rounding. Accordingly, figures shown as totals in the table may not be
an arithmetic aggregation of the figures preceding them.
As of September 30, 2024, the Mineral Resources for Wulong Gold Mine are estimated
to be about 2,999 thousand tonnes with an average Au grade of 7.61 g/t, including
approximately 1,261 thousand tonnes of Indicated Mineral Resources with an average Au grade
of 8.17 g/t, and 1,738 thousand tonnes of Inferred Mineral Resources with an average Au grade
of 7.21 g/t. The Mineral Resources for Jilong Gold Mine are estimated to be about 1,415
thousand tonnes with an average Au grade of 10.25 g/t, including approximately 484 thousand
tonnes of Measured Mineral Resources with an average Au grade of 12.19 g/t, 424 thousand
tonnes of Indicated Mineral Resources with an average Au grade of 9.25 g/t, 508 thousand
tonnes of Inferred Mineral Resources with an average Au grade of 9.24 g/t. The Mineral
Resources for Huatai Gold Mine are estimated to be about 3,812 thousand tonnes with an
average Au grade of 7.01 g/t, including approximately 385 thousand tonnes of Measured
Mineral Resources with an average Au grade of 5.88g/t, 2,146 thousand tonnes of Indicated
Mineral Resources with an average Au grade of 7.27 g/t, 1,281 thousand tonnes of Inferred
Mineral Resources with an average Au grade of 6.90 g/t. The Mineral Resources for Jintai Gold
Mine are estimated to be about 10,666 thousand tonnes with an average Au grade of 1.30 g/t,
including approximately 3,363 thousand tonnes of Measured Mineral Resources with an
average Au grade of 1.68 g/t, 4,604 thousand tonnes of Indicated Mineral Resources with an
average Au grade of 1.02 g/t, 2,699 thousand tonnes of Inferred Mineral Resources with an
average Au grade of 1.29 g/t.
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As of September 30, 2024, the Mineral Resources for our PRC Mines are estimated to be
about 18,893 thousand tonnes with an average Au grade of 4.12 g/t, including approximately
4,232 thousand tonnes of Measured Mineral Resources with an average Au grade of 3.26 g/t,
8,435 thousand tonnes of Indicated Mineral Resources with an average Au grade of 4.09 g/t,
6,226 thousand tonnes of Inferred Mineral Resources with an average Au grade of 4.75 g/t.
As of September 30, 2024, the Measured Mineral Resources for our PRC Mines contained
13.80 tonnes of gold, the Indicated Resources contained 34.52 tonnes of gold and the Inferred
Resources contained 29.55 tonnes of gold, the total Resources contained 77.87 tonnes of gold.
The following table, which is based on the Competent Person’s Report in accordance with
JORC Code, sets forth the information of our gold Reserves of Wulong Gold Mine, Jilong Gold
Mine, Huatai Gold Mine and Jintai Gold Mine as of September 30, 2024:
Mineralized Zone/Block Category Tonnage Au Grade
Au Metal
Contained
Au Metal
Contained
(kt) (g/t) (koz) (t)
Wulong Gold Mine /H1118/H1118/H1118Proved ––––
Probable 984 7.30 231 7.19
Total 984 7.30 231 7.19
Jilong Gold Mine /H1118/H1118/H1118/H1118Proved 510 9.81 161 5.00
Probable 409 7.38 97 3.02
Total 919 8.73 258 8.02
Huatai Gold Mine /H1118/H1118/H1118/H1118Proved 226 5.21 38 1.18
Probable 1,468 6.35 300 9.32
Total 1,694 6.20 338 10.50
Jintai Gold Mine /H1118/H1118/H1118/H1118/H1118Proved ––––
Probable 1,370 0.75 33 1.03
Total 1,370 0.75 33 1.03
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Proved 736 8.40 199 6.18
Probable 4,231 4.86 661 20.55
Total 4,967 5.38 860 26.73
Note:
1. Numbers have been subject to rounding. Accordingly, figures shown as totals in the table may not be
an arithmetic aggregation of the figures preceding them.
As of September 30, 2024, the Probable Ore Reserves for Wulong Gold Mine are about
984 thousand tonnes with an average Au grade of 7.30 g/t. The Ore Reserves for Jinlong Gold
Mine are about 919 thousand tonnes with an average Au grade of 8.73 g/t, of which 510
thousand tonnes are Proved Ore Reserves with an average Au grade of 9.81 g/t, and 409
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thousand tonnes are Probable Ore Reserves with an average Au grade of 7.38 g/t. The Ore
Reserves for Huatai Gold Mine are about 1,694 thousand tonnes with an average Au grade of
6.20 g/t, of which 226 thousand tonnes are Proved Ore Reserves with an average Au grade of
5.21 g/t, and 1,468 thousand tonnes are Probable Ore Reserves with an average Au grade of
6.35 g/t. The Probable Ore Reserves for Jintai Gold Mine are about 1,370 thousand tonnes with
an average Au grade of 0.75 g/t.
As of September 30, 2024, the Ore Reserves for PRC Mines are about 4,967 thousand
tonnes with an average Au grade of 5.38 g/t, of which 736 thousand tonnes are Proved Ore
Reserves with an average Au grade of 8.40 g/t, and 4,231 thousand tonnes are Probable Ore
Reserves with an average Au grade of 4.86 g/t.
Mining Licenses and Exploration Permits
As of the Latest Practicable Date, our PRC gold production business held a total of 10
valid mining licenses, including (i) two mining licenses for Jilong Mining, (ii) six mining
licenses for Huatai Mining, (iii) one mining license for Wulong Mining, and (iv) one mining
license for Jintai Mining. These mining licenses covered a total area of approximately
35.6 km
2.
In addition, as of the Latest Practicable Date, our PRC gold production business held a
total of four valid exploration permits, including (i) one exploration permit for Jilong Mining,
(ii) two exploration permits for Wulong Mining and (iii) one exploration permit for Jintai
Mining. These exploration permits covered a total area of approximately 18.6 km
2.
Our mining licenses in the PRC are generally valid for several years to 30 years. Our
exploration permits are generally valid for five years and renewed accordingly subject to some
conditions respectively. We aim to renew our mining licenses or exploration permits before
their respective expiry dates. As advised by our PRC Legal Advisor, there are no explicit
regulations limiting the number of times a mining license or an exploration permit may be
renewed in the PRC. We and our PRC Legal Advisor do not expect any material legal
impediment in the renewal process if we submit our application in accordance with the relevant
laws and regulations. For details of relevant risks, see “Risk Factors — Risks Relating to Our
Business and Industry — We may fail to obtain, maintain or renew the government permits,
licenses and approvals required for our mining and exploration activities.”
We firstly undertake exploration activities in the areas covered by our exploration
permits. If we deem the return of our exploration activities economically reasonable, we will
apply to the relevant competent authorities for mining licenses covering such areas. The PRC
mining laws and regulations grant the holder of an exploration permit priority in obtaining a
mining license upon successful discovery of Mineral Resources. For details of the PRC mining
laws and regulations, see “Regulatory Overview”.
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The following table sets forth information regarding our relevant mining licenses and
exploration permits as of the Latest Practicable Date:
Wulong Mining
Type Serial Number
Geographical
Area (km 2) Effective Period Status
Mining license /H1118/H1118/H1118/H1118/H1118C2100002011084140116558 6.2732 December 4, 2020 to
August 4, 2035
V alid
Exploration Permit /H1118/H1118T2100002008044010006347 3.88 November 20, 2024 to
November 20, 2029
V alid
Exploration Permit /H1118/H1118T2100002008044010005662 0.6112 June 2, 2023 to
June 2, 2028
V alid
Jilong Mining
Type Serial Number
Geographical
Area (km 2) Effective Period Status
Mining License /H1118/H1118/H1118/H1118/H1118/H1118C1500002009114120054250 8.61 May 1, 2024 to
September 26, 2026
V alid
Mining License /H1118/H1118/H1118/H1118/H1118/H1118C1500002023124210156146 9.1340 December 27, 2023 to
March 27, 2032
V alid
Exploration Permit /H1118/H1118/H1118T1500002008044010006035 3.83 March 25, 2021 to
March 24, 2026
V alid
Huatai Mining
Type Serial Number
Geographical
Area (km 2) Effective Period Status
Mining License /H1118/H1118/H1118/H1118C1500002009064120021513 2.7978 June 6, 2024 to
June 5, 2044
V alid
Mining License /H1118/H1118/H1118/H1118C1500002011014140119663 0.8138 September 15, 2024
to September 14,
2027
V alid
Mining License /H1118/H1118/H1118/H1118C1500002013094210131353 1.0164 March 11, 2024 to
September 5, 2025
V alid
Mining License /H1118/H1118/H1118/H1118C1500002015114210140450 1.8332 November 17, 2015 to
November 17, 2025
V alid
Mining License /H1118/H1118/H1118/H1118C1500002015114210140451 0.3199 November 18, 2024 to
November 17, 2025
V alid
Mining License /H1118/H1118/H1118/H1118C1500002015114210140449 3.7362 November 18, 2023 to
November 17, 2025
V alid
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Jintai Mining
Type Serial Number
Geographical
Area (km 2) Effective Period Status
Mining license /H1118/H1118/H1118/H1118/H1118C5300002012054110124688 1.0920 June 7, 2022 to
June 6, 2032
V alid
Exploration Permit /H1118/H1118T5300002009034010026977 10.28 June 3, 2021 to
June 3, 2026
V alid
Development Plan and Planned Production Schedule
Development Plan
The following timeline illustrates key historical and planned milestones in the
development of our PRC Gold Mines:
Wulong Mining
Y ear Milestone
1949 /H1118/H1118/H1118/H1118/H1118/H1118Officially commenced production
1958 /H1118/H1118/H1118/H1118/H1118/H1118Processing capacity of processing plant reached 150 t/d
1966 /H1118/H1118/H1118/H1118/H1118/H1118Annual gold production exceeded 1 ton for the first time, reaching 1.1 ton
2013 /H1118/H1118/H1118/H1118/H1118/H1118Wulong Mining merged into our Company
2022 /H1118/H1118/H1118/H1118/H1118/H1118Completed and put into operation a new 3,000 t/d processing plant.
Completed the “First Deep Drill Hole of Gold Exploration in the
Liaodong Area” at the Wulong project area with a final depth of 3,003.99
meters, achieving a significant breakthrough in gold exploration.
2025-2026 /H1118/H1118Plan to undertake the renovation of shaft and the expansion of tunnels,
including shaft deepening projects and technical renovation projects
2027 /H1118/H1118/H1118/H1118/H1118/H1118Plan to increase our mining capacity by 33.1% compared to 2024
Jilong Mining
Y ear Milestone
1958 /H1118/H1118/H1118/H1118/H1118/H1118Commenced mine construction commenced
2008 /H1118/H1118/H1118/H1118/H1118/H1118Processing capacity of the processing plant reached 400 t/d
2012 /H1118/H1118/H1118/H1118/H1118/H1118Annual gold production exceeded 1 ton for the first time, reaching 1.3 ton
Jilong Mining merged into our Company
2024 /H1118/H1118/H1118/H1118/H1118/H1118Expanded mining capacity of No. 1, No. 2, No. 3 mining areas from 400 t/d
to 600 t/d,
new processing plant with a processing capacity of 600t/d, bringing the
total processing capacity of the mine up to 1000 t/d
2025-2026 /H1118/H1118Plan to undertake the renovation of shaft and ventilation shafts, and the
expansion of tunnels
2027 /H1118/H1118/H1118/H1118/H1118/H1118Plan to increase our mining capacity by 33.1% compared to 2024
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Huatai Mining
Y ear Milestone
1959 /H1118/H1118/H1118/H1118/H1118/H1118Commenced mine construction
1987 /H1118/H1118/H1118/H1118/H1118/H1118The No. 2 vertical shaft at Honghuagou No. 1 mining area, single shaft
gold production exceeded 300 kg
1988 /H1118/H1118/H1118/H1118/H1118/H1118Processing capacity of processing plant reached 200 t/d
2012 /H1118/H1118/H1118/H1118/H1118/H1118Huatai Mining merged into our Company
2022 /H1118/H1118/H1118/H1118/H1118/H1118Started process to obtain permits for production expansion
2025 /H1118/H1118/H1118/H1118/H1118/H1118Plan to continue with the technical renovation projects
2026 /H1118/H1118/H1118/H1118/H1118/H1118Plan to substantially complete the infrastructure development and to
increase the annual mining capacity by 30,000 tonnes
Jintai Mining
Y ear Milestone
2008 /H1118/H1118/H1118/H1118/H1118/H1118Established Jintai Mining
2023 /H1118/H1118/H1118/H1118/H1118/H1118Became a subsidiary of our Company
2023 /H1118/H1118/H1118/H1118/H1118/H1118The Phase I mining and processing project with a capacity of 140,000 t/a
commenced operation; gold production of 75 kg in 2023
2024 /H1118/H1118/H1118/H1118/H1118/H1118Launched Phase II mining and processing project with an additional
capacity of 600,000 t/a
2025 /H1118/H1118/H1118/H1118/H1118/H1118Plan to increase our annual gold production to 1 tonnes
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Planned Production Schedule
As set forth in the Competent Person’s Report, the following chart sets forth the planned mining and production schedule for the operations
in our PRC Gold mines for the periods indicated over the life of mine:
Underground Gold
Mine in China Unit LOM
2024
Q4 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049 2050 2051 2052 2053
Jilong
Mined Tonnes /H1118/H1118/H1118/H1118k t 9 1 9 8 8 1 8 4 1 8 0 1 9 4 1 0 9 5 8 5 5 3 8 1 3–––––––––––––––––––––
Milled Tonnes /H1118/H1118/H1118/H1118k t 9 1 9 8 8 1 8 4 1 8 0 1 9 4 1 0 9 5 8 5 5 3 8 1 3–––––––––––––––––––––
Gold Produced /H1118/H1118/H1118/H1118k o z 2 5 0 2 4 4 3 3 7 4 6 3 1 2 2 2 2 1 87–––––––––––––––––––––
Huatai
Mined Tonnes /H1118/H1118/H1118/H1118kt 1,693 – – 60 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 50
Milled Tonnes /H1118/H1118/H1118/H1118kt 1,693 – – 60 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 50
Gold Produced /H1118/H1118/H1118/H1118k o z 3 1 5 – –1 0 9 81 01 01 0 91 0 91 01 0 91 11 31 21 11 31 11 61 91 71 71 41 41 3 8 8 6
Wulong
Mined Tonnes /H1118/H1118/H1118/H1118k t 9 8 4 2 7 9 9 9 9 9 8 9 9 1 0 8 1 0 8 1 0 2 1 0 1 6 6 4 4 3 3––––––––––––––––––
Milled Tonnes /H1118/H1118/H1118/H1118k t 9 8 4 2 7 9 9 9 9 9 8 9 9 1 0 8 1 0 8 1 0 2 1 0 1 6 6 4 4 3 3––––––––––––––––––
Gold Produced /H1118/H1118/H1118/H1118k o z 2 1 05 2 2 2 5 2 2 2 1 2 3 2 4 2 1 1 7 1 5 1 04––––––––––––––––––
Total Underground
Mined Tonnes /H1118/H1118/H1118/H1118kt 3,597 115 282 340 353 269 227 224 200 175 127 105 94 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 50
Milled Tonnes /H1118/H1118/H1118/H1118kt 3,597 115 282 340 353 269 227 224 200 175 127 105 94 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 50
Gold Produced /H1118/H1118/H1118/H1118koz 775 29 64 72 78 61 55 56 49 33 25 19 15 10 9 11 13 12 11 13 11 16 19 17 17 14 14 13 8 8 6
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Open Pit Gold Mine
in China Unit LOM
2024
Q4 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049 2050 2051 2052 2053
Jintai
Mined Tonnes /H1118/H1118/H1118kt 1,370 33 140 140 140 140 137 137 132 135 140 94 – ––––––––––––––––––
Milled Tonnes /H1118/H1118/H1118/H1118kt 1,370 33 140 140 140 140 137 137 132 135 140 94 – ––––––––––––––––––
Gold Produced /H1118/H1118/H1118/H1118k o z 2 612242232252–––––––––––––––––––
Notes:
1. The planned production schedule of the LOM, was made based on the data collected of our PRC Gold Mines as of September 30, 2024.
2. LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year since September 30, 2024, until all Ore Reserves are extracted in the final
year. The forecasted production volume is estimated based on the designed mining capacity, scheduling strategy and expansion timelines.
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Capital Costs
With the reference to the Independent Technical Report, our Directors confirmed that the
capital costs of the PRC Gold Mines for the three years ended December 31, 2023 were
approximately RMB1,101.9 million. The Independent Technical consultant has reviewed the
breakdown of the capital forecast and considered appropriate capital has been allocated to
support the development of the PRC Gold Mines and the basis of the capital cost estimation
is considered reasonable. For detailed capital cost of the PRC Gold Mines, please refer to
“Appendix IIIA — Competent Person’s Report for the PRC Mines — Capital Expenditure
Forecast”.
Operating Costs
In 2022 and 2023, our PRC Gold Mines recorded gold AISCs of approximately
US$1,205.7 per ounce and US$877.4 per ounce, respectively, showing a decrease of 27.2%
year-on-year.
The table below sets forth a summary of the forecasted operating costs between 2024 and
2053 for our PRC Gold Mines, as stated in the Competent Person’s Report:
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Wulong Gold Mine Unit 2021 2022 2023 2024Q1-Q3 LOM 2024Q4 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035
Labor /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million 80.15 94.88 139.89 108.02 659.58 18.42 66.12 66.46 65.59 66.52 72.15 72.65 68.40 67.50 44.20 29.44 22.14
Material /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million 19.00 56.27 85.03 49.10 326.56 9.12 32.74 32.90 32.48 32.93 35.72 35.97 33.87 33.42 21.88 14.58 10.96
Electricity /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million 28.12 41.87 38.39 33.15 98.46 2.75 9.87 9.92 9.79 9.93 10.77 10.84 10.21 10.08 6.60 4.39 3.30
Contractors /H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million 7.21 – – – 18.57 0.52 1.86 1.87 1.85 1.87 2.03 2.04 1.93 1.90 1.24 0.83 0.62
Engineering /H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million 8.34 – – 1.75 21.47 0.60 2.15 2.16 2.14 2.17 2.35 2.37 2.23 2.20 1.44 0.96 0.72
Service /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million 0.96 8.18 8.16 24.27 46.51 1.30 4.66 4.69 4.63 4.69 5.09 5.12 4.82 4.76 3.12 2.08 1.56
Safety /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million – – – ––––––––––––––
Repairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million 3.10 2.20 2.20 3.20 7.98 0.22 0.80 0.80 0.79 0.80 0.87 0.88 0.83 0.82 0.53 0.36 0.27
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million – – – ––––––––––––––
Taxes and surcharges /H1118/H1118RMB million 12.69 20.57 31.68 30.23 57.94 1.62 5.81 5.84 5.76 5.84 6.34 6.38 6.01 5.93 3.88 2.59 1.94
Selling costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million – – – ––––––––––––––
G&A costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million 21.49 44.23 28.24 14.10 104.01 2.90 10.43 10.48 10.34 10.49 11.38 11.46 10.79 10.64 6.97 4.64 3.49
R&D costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million 11.12 16.21 26.81 26.27 50.34 1.41 5.05 5.07 5.01 5.08 5.51 5.54 5.22 5.15 3.37 2.25 1.69
Total costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million 192.16 284.40 360.40 290.10 1,391.41 38.85 139.48 140.19 138.37 140.32 152.20 153.26 144.29 142.40 93.24 62.10 46.70
Note: LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year since September 30, 2024, until all Ore Reserves are ex tracted in the final
year. The forecasted production volume is estimated based on the designed mining capacity, scheduling strategy and expansion timelines.
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Jilong Gold Mine Unit 2021 2022 2023 2024Q1-Q3 LOM 2024Q4 2025 2026 2027 2028 2029 2030 2031 2032
Labor /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million 58.90 63.14 61.14 64.52 569.9 54.3 113.9 111.7 120.4 67.7 36.3 34.0 23.3 8.4
Material /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million 19.19 24.47 24.24 27.08 212.2 20.2 42.4 41.6 44.8 25.2 13.5 12.6 8.7 3.1
Electricity /H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million 11.04 10.74 10.76 13.44 73.5 7.0 14.7 14.4 15.5 8.7 4.7 4.4 3.0 1.1
Contractors /H1118/H1118/H1118/H1118/H1118/H1118RMB million – – – –––––––––––
Engineering /H1118/H1118/H1118/H1118/H1118/H1118RMB million 4.46 4.19 3.65 1.90 28.5 2.7 5.7 5.6 6.0 3.4 1.8 1.7 1.2 0.4
Service /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million 1.89 2.02 0.65 0.09 12.1 1.2 2.4 2.4 2.6 1.4 0.8 0.7 0.5 0.2
Safety /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million 3.96 4.00 3.05 6.91 37.8 3.6 7.6 7.4 8.0 4.5 2.4 2.3 1.5 0.6
Repairment /H1118/H1118/H1118/H1118/H1118/H1118RMB million 1.42 1.67 1.69 0.25 10.2 1.0 2.0 2.0 2.1 1.2 0.6 0.6 0.4 0.1
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million 0.52 0.53 0.21 0.09 3.3 0.3 0.7 0.6 0.7 0.4 0.2 0.2 0.1 0.0
Taxes and surcharges /H1118RMB million 16.97 15.97 63.29 19.00 171.6 16.3 34.3 33.6 36.3 20.4 10.9 10.2 7.0 2.5
Selling costs /H1118/H1118/H1118/H1118/H1118/H1118RMB million 0.08 0.10 0.12 0.00 0.7 0.1 0.1 0.1 0.1 0.1 0.0 0.0 0.0 0.0
G&A costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million 30.21 30.45 43.12 28.96 259.7 24.7 51.9 50.9 54.9 30.9 16.5 15.5 10.6 3.8
R&D costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million 10.19 8.38 20.33 16.36 122.5 11.7 24.5 24.0 25.9 14.6 7.8 7.3 5.0 1.8
Total costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million 158.81 165.67 232.24 178.60 1,501.93 143.09 300.19 294.46 317.35 178.47 95.55 89.51 61.31 22.01
Note: LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year since September 30, 2024, until all Ore Reserves are ex tracted in the final
year. The forecasted production volume is estimated based on the designed mining capacity, scheduling strategy and expansion timelines.
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Huatai Gold Mine Unit 2021 2022 2023 2024Q1-Q3 LOM 2024Q4 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 204 4 2045 2046 2047 2048 2049 2050 2051 2052 2053
Labor /H1118/H1118/H1118/H1118/H1118/H1118RMB million 28.10 4.72 3.28 – 975.6 – – 34.7 35.1 35.1 35.1 35.1 35.1 35.1 35.1 35.1 35.1 35.1 35.1 35.1 35.1 35.1 35.1 35.1 35.1 35.1 35.1 35.1 35.1 35.1 35.1 35.1 35.1 35.1 28.8
Material /H1118/H1118/H1118/H1118/H1118RMB million 2.71 1.59 0.04 – 92.6 – – 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 2.7
Electricity /H1118/H1118/H1118/H1118RMB million 4.35 1.96 0.26 – 125.7 – – 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 3.7
Contractors /H1118/H1118/H1118/H1118RMB million – – – – – ––––––––––––––––––––––––––––––
Engineering /H1118/H1118/H1118/H1118RMB million 9.99 10.32 1.49 – 289.1 – – 10.3 10.4 10.4 10.4 10.4 10.4 10.4 10.4 10.4 10.4 10.4 10.4 10.4 10.4 10.4 10.4 10.4 10.4 10.4 10.4 10.4 10.4 10.4 10.4 10.4 10.4 10.4 8.5
Service /H1118/H1118/H1118/H1118/H1118RMB million 0.91 0.47 0.02 – 41.5 – – 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.2
Safety /H1118/H1118/H1118/H1118/H1118/H1118RMB million 1.34 0.30 0.03 – 38.7 – – 1.4 1.4 1.4 1.4 1.4 1.4 1.4 1.4 1.4 1.4 1.4 1.4 1.4 1.4 1.4 1.4 1.4 1.4 1.4 1.4 1.4 1.4 1.4 1.4 1.4 1.4 1.4 1.1
Repairment /H1118/H1118/H1118/H1118RMB million 0.39 0.13 0.00 – 11.2 – – 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.3
Others /H1118/H1118/H1118/H1118/H1118RMB million 0.01 0.00 0.01 – 0.6 – – 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Taxes and surcharges /H1118RMB million 4.42 2.90 2.51 3.78 128.0 – – 4.6 4.6 4.6 4.6 4.6 4.6 4.6 4.6 4.6 4.6 4.6 4.6 4.6 4.6 4.6 4.6 4.6 4.6 4.6 4.6 4.6 4.6 4.6 4.6 4.6 4.6 4.6 3.8
Selling costs /H1118/H1118/H1118/H1118RMB million – – – – – ––––––––––––––––––––––––––––––
G&A costs /H1118/H1118/H1118/H1118RMB million 14.42 27.54 16.62 12.46 500.6 – – 17.8 18.0 18.0 18.0 18.0 18.0 18.0 18.0 18.0 18.0 18.0 18.0 18.0 18.0 18.0 18.0 18.0 18.0 18.0 18.0 18.0 18.0 18 .0 18.0 18.0 18.0 18.0 14.8
R&D costs /H1118/H1118/H1118/H1118RMB million – – – – – ––––––––––––––––––––––––––––––
Total costs /H1118/H1118/H1118/H1118RMB million 66.63 49.93 24.27 16.23 2,203.83 – – 78.47 79.18 79.40 79.18 79.18 79.18 79.40 79.18 79.18 79.18 79.40 79.18 79.18 79.18 79.40 79.18 79.18 79 .18 79.40 79.18 79.18 79.18 79.40 79.18 79.18 79.18 79.40 65.14
Note: LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year since September 30, 2024, until all Ore Reserves are ex tracted in the final
year. The forecasted production volume is estimated based on the designed mining capacity, scheduling strategy and expansion timelines.
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Jintai Gold Mine Unit 2023 2024Q1-Q3 LOM 2024Q4 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034
Labor /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million 1.77 2.66 19.77 0.48 2.02 2.02 2.03 2.02 1.98 1.98 1.91 1.95 2.02 1.36
Material /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million 1.86 5.36 20.76 0.51 2.12 2.12 2.13 2.12 2.08 2.08 2.01 2.05 2.12 1.43
Electricity /H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million 0.07 0.60 2.03 0.05 0.21 0.21 0.21 0.21 0.20 0.20 0.20 0.20 0.21 0.14
Contractors /H1118/H1118/H1118/H1118/H1118/H1118RMB million 1.04 1.08 11.57 0.28 1.18 1.18 1.18 1.18 1.16 1.16 1.12 1.14 1.18 0.80
Engineering /H1118/H1118/H1118/H1118/H1118/H1118RMB million 1.07 4.14 14.04 0.34 1.44 1.43 1.44 1.43 1.40 1.41 1.36 1.39 1.43 0.97
Service /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million 1.50 6.39 21.66 0.53 2.22 2.21 2.22 2.21 2.17 2.17 2.09 2.14 2.21 1.49
Safety /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million 0.62 1.65 6.85 0.17 0.70 0.70 0.70 0.70 0.69 0.69 0.66 0.68 0.70 0.47
Repairment /H1118/H1118/H1118/H1118/H1118/H1118RMB million – – – –––––––––––
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million – – – –––––––––––
Taxes and surcharges /H1118RMB million 1.23 0.03 13.67 0.33 1.40 1.40 1.40 1.40 1.37 1.37 1.32 1.35 1.40 0.94
Selling costs /H1118/H1118/H1118/H1118/H1118/H1118RMB million 0.04 0.11 0.49 0.01 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.03
G&A costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million 4.45 6.39 49.58 1.21 5.07 5.06 5.08 5.07 4.96 4.97 4.79 4.89 5.07 3.41
R&D costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million – – – –––––––––––
Total costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB million 13.65 28.41 160.41 3.91 16.41 16.37 16.43 16.39 16.04 16.09 15.50 15.84 16.39 11.04
Note: LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year since September 30, 2024, until all Ore Reserves are ex tracted in the final
year. The forecasted production volume is estimated based on the designed mining capacity, scheduling strategy and expansion timelines.
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Risks Associated with the PRC Gold Mines
The mining industry is inherently associated with a high level of risk, which is
accumulated due to factors such as the nature of ore body, ore distribution, grade and variations
in mining and ore processing, which are not able to be accurately predicted or accounted for.
The following table sets forth a selected summary of the risk assessment regarding the material
risks undertaken by the Independent Technical Consultant, including the assessment result and
the ratings of the relevant risks. For more details of the risks associated with of the PRC Gold
Mines, please refer to “Appendix IIIA — Competent Person’s Report for the PRC Mines —
Risk Assessment.”
Material Risk Assessment of the PRC Gold Mines
Risk Source/Issue Likehood Consequence Risk
Jilong Project
Geology, Mineral Resources and
Ore Reserves
Lack of Significant Ore Reserve /H1118/H1118/H1118Unlikely Major Medium
Mining
Poor Underground Condition /H1118/H1118/H1118/H1118/H1118/H1118Possible Moderate Medium
Significantly lacking Ore Reserves /H1118/H1118Unlikely Major Medium
Ore processing and smelting
Lower throughput /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Unlikely Moderate Low
Lower Smelting Recovery /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Possible Moderate Medium
Capital and Operating Costs
Operating Cost Underestimated /H1118/H1118/H1118/H1118Possible Moderate Medium
Huatai Project
Geology, Mineral Resources and
Ore Reserves
Lack of Significant Ore Reserve /H1118/H1118/H1118Unlikely Major Medium
Mining
Significant Geological Structure /H1118/H1118/H1118Unlikely Moderate Low
Significantly lacking Ore Reserves /H1118Unlikely Major Medium
Ore Processing and smelting
Lower Smelting Recovery /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Possible Moderate Medium
Capital and Operating Costs
Project Timing Delay /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Likely Minor Low
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Material Risk Assessment of the PRC Gold Mines
Risk Source/Issue Likehood Consequence Risk
Wulong Project
Geology, Mineral Resources and
Ore Reserves
Lack of Significant Ore Reserve /H1118/H1118/H1118Unlikely Major Medium
Mining
Significantly lacking Ore Reserves /H1118Unlikely Major Medium
Environmental and Social
Environmental Approval /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Possible Moderate Medium
Capital and Operating Costs
Capital Cost Increases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Possible Moderate Medium
Operating Cost Underestimated /H1118/H1118/H1118/H1118Possible Moderate Medium
Jintai Project
Geology, Mineral Resources and
Ore Reserves
Lack of Significant Ore Reserve /H1118/H1118/H1118Unlikely Major Medium
Mining
Significantly lacking Ore Reserves /H1118Unlikely Major Medium
Processing and Metallurgy
Poor Permeability of Ore Heap /H1118/H1118/H1118/H1118Possible Moderate Medium
Lower Gold Recovery /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Possible Moderate Medium
Environmental and Social
Water Management /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Unlikely Major Medium
Waste Rock and Tailings
Management /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Unlikely Moderate Low
Capital and Operating Costs
Capital Cost Increases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Possible Moderate Medium
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Operating Process of Gold Production Business in the PRC
(a) Overview
Our gold production operations in the PRC can generally be divided into two steps,
namely, (i) mining and (ii) processing. Our mines in the PRC are also equipped with processing
plants to process the ores that we mine into doré, gold concentrate powder or gold-loaded
carbon. The following diagrams sets forth the general workflow of the gold production process
in our PRC Gold Mines:
 -+
+-
+-
Run-of-mine
Double deck screen
Hydrocyclone
Roughing I
Roughing II Cleaning I
Cleaning II
Cleaning III
Thickening
Overflow
Filter LiquorGold
Concentrate
Filtration
Roughing III
Scavenging I
Scavenging II
Thickening
OverflowFiltration
Tailings Filter Liquor
Primary
Crusher
Secondary
Crusher
Third
Crusher
Primary
Grinding
Secondary
Grinding
Hydrocyclone
Production Process Flowsheet of Wulong Processing Plant
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Run-of-mine
Vibrating Screen
Lime and sodium cyanide
Ball Mill
Classification
Thickening
Purification
Deoxygenation
Substitution  First wash
 Second wash
Third wash
 Fourth wash
 Tailings filtration (Decyanation)
Tailings
Leaching
flocculant
Filtration
Gold Smelting
Gold Ingot
Filter Liquor
Impurities
Primary
Crusher
Sodium cyanide
and air inflation
Zinc powder and
lead acetate
Secondary
Crusher
Production Flowsheet of Jilong Processing Plant
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Run-of-mine
Primary
Crusher
Vibrating Screen
Coarse
Grinding
Trash Screen
Trash
TrashWater Recycling Pool
Overflow
Trash Screen
Thickening
Hydrocyclone
Fine Grinding
Sodium cyanide
Carbon
Pulp Stirring
Leaching
Adsorption
Carbon Separation Screen
Leaching residue
Carbon safety screen
Tailings Filter Liquor
Fine Carbon
 Filtration (Decyanation)
Loaded Carbon
Stripping
Pregnant solution Stripped carbon
Electrowinning  Acid wash
 Carbon regeneration
Returned to
adsorption
Gold Slime
Gold
bullion
Smelting
Slag
Barren solution
Fine Crusher
Lime
Classification
Processing Flowsheet of Huatai Processing Plant
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Run-of-Mine
Receiving Hopper
Grizzly Feeder
Vibrating Screen
Ore Stacking
Heap Leaching
Washing &
Cyanide Deconstruction
Pregnant Leach Solution
Active Carbon Adsorption
Gold Loaded Carbon
Elution-Electrowinning-Smelting
Gold Dorè
-100mm
-35mm
Lime
+100mm
+35mm
Primary Jaw Crusher
Secondary Jaw Crusher
Barren Solution
Regeneration
Stripped Carbon
Reagent
Heap Leaching Process Flowsheet of Jintai Gold Mine
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(b) Mining
We primarily utilize the resuing method for our underground mining at the Wulong Gold
Mine, Jilong Gold Mine and Huatai Gold Mine in the PRC. Our mining equipment mainly
includes rock drilling machines, jacklegs, and scrappers. Details of the mining workflow are
set forth below:
 Planning . We undertake detailed planning prior to actual production, which covers
chambers, pillars, ventilation shaft, ore passes and filling raises. We generally divide
the mine area into different subsections, and use each subsection as a stoping unit.
 Preparation and cutting . We conduct extensive planning and cut for the ventilation
raises, ore passes and filling raises. Then we drill holes in the rock wall, charge such
holes with explosives and blast the rock wall.
 Stoping . We extract ore from the surrounding rock wall and it creates a void.
Stoping is conducted in a hierarchical manner.
 Extraction . We transport the ore to the surface via ore passes by minecarts or
mining trucks.
 Filling . We backfill the void with different kinds of filling materials, such as the
waste rock from our blasting and/or development cutting, in order to reinforce the
ground.
To a lesser extent, we also the utilize open-pit mining method at the Jintai Gold Mine.
Details of the mining workflow are set forth below:
 Planning . Before actual production, we carry out detailed planning, which includes
the layout of the mine benches, stripping of overburden, and the mining of the ore.
 Stripping . We undertake extensive preparatory work. Initially, a small amount of
the overburden on top of the ore body is stripped away, followed by the
commencement of mining. The entire stripping process is carried out entirely by
excavators for digging, without the need for blasting.
 Transportation : We use trucks to transport the stripped soil and ore through
transportation benches, separately to the waste dump and workshop.
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(c) Processing
The Wulong Gold Mine primarily utilizes the flotation process method. Our plant mainly
includes crushing circuits, grinding circuits, flotation circuits, filter machines and conveyers.
Details of the processing workflow are set forth below:
 Crushing circuit . Typically, ores the from underground are crushed in multi-stages
of closed-circuit crushing.
 Grinding circuit . The final crushed ore is ground in a grinding circuit operated in
a closed circuit.
 Flotation circuit . The ground product is processed in a flotation circuit, which
typically consists of rougher flotation, multi-stage clean flotation and scavenger
flotation.
 Concentrate dewatering . The concentrate is dewatered by filter machine and
separated from tailings.
The Jilong Gold Mine and Huatai Gold Mine primarily utilize the all-slime cyanidation
absorption gold extraction method. Our plants mainly include crushing circuits, grinding
circuits, pressure filters and conveyers. Details of the processing workflow are set forth below:
 Crushing circuit . Typically, ores from underground are crushed in multi-stages of
closed-circuit crushing.
 Grinding circuit . The final crushed ore is ground in a grinding circuit operated in
a closed circuit.
 Cyanidation leaching . Ore pulp is absorbed through multi-cyanidation leaching.
 Replacement . Replaced gold concentrate is obtained through purification,
deoxidation and replacement by zinc powder or carbon.
 Tailings dewatering . Gold concentrate is dewatered by pressure filter and
decyanated by chemicals and then separated from tailings.
The Jintai Gold Mine primarily utilize the carbon-in-pulp gold extraction process method.
The plants mainly include the crushing process, stacking process, leaching process, adsorption
equipment, and stripping equipment. Details of the processing workflow are set forth below:
 Crushing . Typically, the mined ore is crushed through the crushing process. The
crushed ore is then transported by truck to the heap leaching site for stacking.
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 Stacking . In accordance with the design plan, the crushed ore is stacked using a
self-leaching site entry with a mining inlet, where the ore is poured into the heap by
truck and gradually pushed to the outer boundary of the leaching site.
 Leaching . For the heaps that have been stacked and turned over, a drip irrigation
system is installed on top of the heap for heap leaching, and an environmentally
friendly mineral processing reagent is sprayed evenly onto the surface of the ore
heap after being mixed in proportion. The pregnant leach solution generated by the
ore heap is collected centrally and transported to the pregnant leach solution pond.
 Adsorption . The adsorption tank in the adsorption workshop is filled with ground
and cleaned activated carbon, and the precious liquid is transported from the
pregnant leach solution pond to the adsorption tank for adsorption. The activated
carbon is stirred by pressurized air equipment to ensure even adsorption.
 Stripping . The loaded gold-loaded carbon is extracted by the stripping equipment
and serves as the final sale product.
Exploration Activities for Gold Production Business in China
Our exploration activities for gold production business in the PRC are mainly carried out
by our in-house exploration team. For relevant risks relating to our exploration activities, see
“Risk Factors — Risks Relating to Our Business and Industry — We may not be able to expand
or replenish our Mineral Resources and Reserves through exploration.”
Exploration Process
In the field of mining geology, we primarily rely on our in-house exploration team, which
collect relevant geological data each year. After the initial study by the exploration team, we
conduct comprehensive studies repeatedly and finalize the exploration plans and mining plans
for the following year. These plans are submitted for internal approval, followed by expert
reviews organized by our headquarters. After necessary revisions and approvals, the plans are
executed quarterly and monthly. Throughout this process, external experts and research teams
may participate in specific research projects intermittently.
For surface exploration, we typically consider various factors, including experience and
qualifications, for third-party collaborations. Upon completion of exploration, reputable
mining consultancy firms prepare the relevant exploration reports. All exploration activities
strictly adhere to China’s national safety production standards, environmental protection
regulations, and mining laws. Local governments may request us to submit technical reports for
reference before commencing mining projects.
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Third-party Exploration Teams
To a lesser extent, we engage third-party exploration service providers to conduct
exploration activities for gold production business in the PRC. When selecting the third-party
exploration teams, we generally take into account a number of factors, including experience,
reputation, qualification and technical conditions. Our technical staff from relevant production
departments are responsible for supervising and managing the work of third-party exploration
teams, such as the progress of the project and stage acceptance check. Our third-party
exploration teams are required to work in strict accordance with all the applicable PRC laws
and regulations in relation to occupation safety and environmental protection. For more
information on third-party exploration teams, see “— Contractors.”
The following table sets forth a selected summary of the key recommendations made by
the Independent Technical Consultant towards our PRC Gold Mines and the relevant measures
that have been taken or will be taken and the expected time frame.
Key Recommendations Measures and time frame
For Huatai, Wulong and Jilong Mine —
To conduct the reconciliation study in the
future to improve the estimation of the
resources and the mining operation /H1118/H1118/H1118/H1118/H1118
We will commission professional
geological survey companies to conduct
geological studies on our mines, and based
on their research and assessment results,
we will carry out subsequent production
work. It is expected that geological
research findings will be submitted every
five years.
For Jintai Mine — to ensure the particle
size of the stacked ore be 100% less than
25mm, and to establish a smelting
workshop to produce gold bullion /H1118/H1118/H1118/H1118/H1118/H1118
We anticipate that by the time the second
phase of construction is completed, the size
of the particle will be controlled within 25
mm and the smelting workshop will be
established after the completion of the
second phase of the construction.
OUR GOLD PRODUCTION BUSINESS IN LAOS
Overview
LXML is the operator of the Sepon Gold and Copper Mine, the mining area of which is
located in Vilabouly District, Savannakhet Province, south-central Laos. It is located on the
Chuankuang-Changshan polymetallic metallogenic belt, which is an important endogenous
metal ore belt in Laos, with various Mineral Resources, especially copper, gold and tin. We
acquired a 90% equity interest in LXML in November 2018 through the acquisition of 100%
equity interest in MMG Laos Holdings Limited (“ MMG Laos ”), i.e., Chijin Laos, for a
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consideration of US$275 million. The remaining 10% equity interest in LXML is held by the
Government of Laos. LXML is a large local mining enterprise in Laos focusing on gold and
copper mining and processing business.
The mining area of the Sepon Gold and Copper Mine was discovered by Rio Tinto in
1992, and LXML was established in September 1993. In 1999, Oxiana acquired 80% stake in
LXML, which later increased to 100% in 2004. LXML commenced gold production in 2003
and copper production in 2005. In 2008, LXML was acquired by OZ Minerals, a mining
company listed on the Australian Securities Exchange. In 2010, MMG Laos acquired LXML
from OZ Minerals and from 2011 started to focus on copper production. In 2013 MMG Laos
decided to halt gold production as the gold Reserves, grade and recovery rates by that time
were not in line with the expectation coupled with the technical constraints on gold processing.
Following our acquisition of LXML in 2018, we shifted the business focus from copper back
to gold and made significant investments in improving the infrastructure, equipment and
technologies for gold production. LXML resumed gold production in 2020, and since then we
have maintained relatively stable annual production volume. For further details, see “—
Development and Expansion”.
The mining operations of the Sepon Gold and Copper Mine are generally carried out
through open pit mining, with an underground mining project under construction which is
commenced mining ore in the third quarter of 2023. It has one production line of gold and one
production line of copper. In the future, the Sepon Gold and Copper Mine will adopt a
combination of open pit mining and underground mining. For details of our copper cathodes
business, see “— Our Other Metal Production Business — Our Copper Cathodes Business in
Laos”. The Sepon Gold and Copper Mine has three separate gold pits that are actively mined.
The main products are doré with 30%-80% gold content and 10%-70% silver content. It has a
designed annual mining capacity of approximately 3.5 million tonnes and designed annual
processing capacity of approximately 3.5 million tonnes.
The Sepon Gold and Copper Mine has been accredited as a Grade A+ Mine, which is the
highest grade awarded to mines in the country, by the Laos Ministry of Energy and Mines for
six successive years since 2016, which is the highest grade awarded to mines in the country.
Meanwhile, LXML was awarded the “Laos Business Leader Award” by the Lao National
Chamber of Commerce and Industry in January 2023 due to the distinguished and significant
contributions it has made to the development of Laos.
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Operation Performance
In 2021, 2022 and 2023 and the nine months ended September 30, 2024, our gold production business in Laos produced 193.0 koz, 199.5 koz,
193.2 koz and 126 koz of gold, respectively. The following table sets forth the ore mined volume, ore processed volume and mine production volume
in relation to gold by the Sepon Gold and Copper Mine for the periods indicated.
Y ear Ended December 31, Nine Months Ended September 30,
2023
Nine Months Ended September 30,
20242021 2022 2023
Ore
Mined
Ore
Processed
Gold
Production
Processing
Capacity
Utilisation
Rate
Ore
Mined
Ore
Processed
Gold
Production
Processing
Capacity
Utilisation
Rate
Ore
Mined
Ore
Processed
Gold
Production
Processing
Capacity
Utilisation
Rate
Ore
Mined
Ore
Processed
Gold
Production
Processing
Capacity
Utilisation
Rate
Ore
Mined
Ore
Processed
Gold
Production
Processing
Capacity
Utilisation
Rate
(kt) (kt) (koz) (kt/a) (kt) (kt) (koz) (kt/a) (kt) (kt) (koz) (kt/a) (kt) (kt) (koz) (kt/a) (kt) (kt) (koz) (kt/a)
Sepon Gold and
Copper Mine –
Gold /H1118/H1118/H1118/H1118/H11184,237 3,407 193.0 3,800 90% 3,794 3,792 199.5 3,800 100% 2,790 3,085 193.2 3,800 81% 1,787 2,457 140.9 2,850 86% 1,890 2,355 125.9 2,850 83%
Notes:
1. In 2023, the volume of ore processed was higher than the volume of ore mined, primarily because some of the ore mined in 2022 was kept as inventory and pr ocessed in 2023,
thus increasing the aggregated amount of the ore processed in 2023.
2. Utilisation rate is calculated by dividing the amount of ore processed by the processing capacity.
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The gold production volume of the Sepon Gold and Copper Mine increased by 3.3% from
193.0 koz in 2021 to 199.5 koz in 2022. This was primarily due to the increase of gold recovery
rate following a series of capital investments and operational improvements. Its gold
production volume slightly decreased by 3.1% from 199.5 koz in 2022 to 193.2 koz in 2023.
The gold production volume of the Sepon Gold and Copper Mine decreased by 10.6% from
140.9 koz as of September 30, 2023 to 125.9 koz as of September 30, 2024, mainly due to the
upgrading of our mining systems to enhance the capacity, which affected gold production.
In 2021, 2022 and 2023 and the nine months ended September 30, 2024, the gold
processing recovery rate of the Sepon Gold and Copper Mine was approximately 54.6%,
63.8%, 64.1% and 64.4%, respectively. In 2021, we recorded relatively low gold processing
recovery rate mainly due to the nature and quality of the ore mined by the Sepon Gold and
Copper Mine. In particular, the primary gold ore is a “double refractory” ore, whereby the gold
is bound up in fine sulphides (pyrite) and has preg-robbing materials that impact recovery.
We have made constant efforts to improve the average gold processing recovery rate of
the Sepon Gold and Copper Mine. We focus on addressing the key challenges related to its gold
processing by improving ore blending, high pressure oxidation, flotation and leaching. In
particular, we increased the gold processing recovery rate through measures such as carbon
desorption optimization, elution circuit optimization, improvement in industrial water quality,
and leaching chemicals in the carbon-in-leach process. This resulted in a significant increase
in the mine’s gold recovery rate increased significantly from 54.6% in 2021 to 64.4% in the
nine months ended September 30, 2024. We are also undertaking optimization of flash flotation
and resin in leach project with the aim to further improve the gold processing recovery rate.
Looking ahead, we expect that the gold processing recovery rate will increase further to
approximately 75% by June 2025.
Development and Expansion
The Sepon Gold and Copper Mine adopted the “One Focus with Two Steps” development
strategy. “One Focus” refers to the target that the volume of copper production will keep stable
while the volume of gold production will increase. “Two Steps” refer to: (i) increasing the
intensity of exploration in our mining area, with the goal of discovering significant Resources
within the next three years; and (ii) increasing investment in both experimental research on
low-grade complex ores and research on the processing technology, together with further work
on enhancing our gold processing recovery rate.
In 2019, LXML invited several geological experts from the United States, United
Kingdom, Australia and other countries to conduct a detailed study on the exploration area of
the Sepon Gold and Copper Mine, which resulted in the determination of 42 gold and 24 copper
target areas in January 2020. In 2021, we formed the “Sepon 2.5 Project” team to increase the
processing capacity of our plant through the addition of a second pressure oxidation station to
double the processing capacity.
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In terms of our overseas gold assets, we are accelerating the construction of the open-pit
and underground mining projects of the Sepon Gold and Copper Mine, which is expected to
increase the annual underground mining capacity to 806,000 tonnes by 2025 from the current
capacity of 536,000 tonnes. Meanwhile, we are accelerating modelling and study work of
exploration prospects of Discovery West Deeps and Phavat North with open-pit and
underground mining potentials, the annual underground mining capacity will be increased
further after 2026 and 2027. As of September 30, 2024, the Inferred Mineral Resources for
Discovery West Deeps are estimated to be about 1,165 thousand tonnes with an average Au
grade of 5.68 g/t.
Mineral Resources and Ore Reserves
The following table, which is based on the Competent Person’s Report in accordance with
the JORC Code, sets forth the information of our gold Resources in Laos as of September 30,
2024:
Mineralized Zone/Block Category Tonnage Au Grade
Au Metal
Contained
Au Metal
Contained
(kt) (g/t) (koz) (t)
Sepon Gold and
Copper Mine –
Gold /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Measured 276 7.98 71 2.21
Indicated 7,220 4.13 958 29.80
Inferred 6,002 3.67 707 22.00
Total 13,498 4.00 1,736 54.01
Notes:
1. As to the Sepon Gold and Copper Mine, the Mineral Resources include the resources from open-pit,
underground and stockpile.
2. Numbers have been subject to rounding. Accordingly, figures shown as totals in the table may not be
an arithmetic aggregation of the figures preceding them.
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The following table, which is based on the Competent Person’s Report in accordance with
the JORC Code, sets forth the information of our gold Reserves in Laos as of September 30,
2024:
Mineralized Zone/Block Category Tonnage Au
Au Metal
Contained
Au Metal
Contained
(kt) (g/t) (koz) (t)
Sepon Gold and Copper
Mine – Gold /H1118/H1118/H1118/H1118/H1118/H1118/H1118Proved 268 4.74 41 1.26
Probable 7,628 3.05 749 23.3
Total 7,896 3.11 790 24.56
Notes:
1. As to the Sepon Gold and Copper Mine, the Ore Reserves include the ore from open-pit, underground
and stockpile.
2. Numbers have been subject to rounding. Accordingly, figures shown as totals in the table may not be
an arithmetic aggregation of the figures preceding them.
Mining Licenses and Exploration Permits
As of the Latest Practicable Date, LXML held one valid mining license covering a total
area of approximately 130.88 km 2. The operation period under the permit started on March 1,
2003, with a maximum operation period of 50 years. The latest mining license was granted with
a term of 10 years from September 30, 2023, which can be renewed for subsequent 10 year
periods.
In addition, as of the Latest Practicable Date, LXML held one valid exploration permit
covering a total area of approximately 1,010.40 km
2. The exploration permit has a total
exploration period (including two extensions) of nine years.
We aim to renew our mining licenses or exploration permits before their respective expiry
dates. Our Laos Legal Advisor does not anticipate any legal impediment in the renewal process,
subject to compliance with relevant laws and regulations. We do not expect any material legal
impediment in the renewal process. For details of Laos mining laws and regulations, see
“Regulatory Overview.”
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The following table sets forth information regarding LXML’s relevant mining licenses
and exploration permits as of the Latest Practicable Date:
Type Serial Number
Geographical
Area (km 2) Effective Period Status
Mining License /H1118/H1118/H1118/H1118/H1118No. 45-24/MEM.MMD 130.88 September 30, 2023
to September 29,
2033
V alid
Exploration Permit /H1118/H1118/H1118No. 1466/MEM. DGM.3 1,010.40 June 14, 2023
to June 14, 2026
V alid
Development Plan and Planned Production Schedule
Development Plan
The following timeline illustrates key historical and planned milestones in the
development of the Sepon Gold and Copper Mine:
Y ear Milestone
2003 /H1118/H1118/H1118/H1118/H1118/H1118Commenced gold production.
2005 /H1118/H1118/H1118/H1118/H1118/H1118Completed the construction of copper processing plant and started copper
production.
2013 /H1118/H1118/H1118/H1118/H1118/H1118Gold production suspended.
2017 /H1118/H1118/H1118/H1118/H1118/H1118Peak production of copper cathode reached 90,000 tonnes per year.
2018 /H1118/H1118/H1118/H1118/H1118/H1118Chifeng Gold acquired LXML which owns the Sepon Gold and Copper
Mine.
2020 /H1118/H1118/H1118/H1118/H1118/H1118The Sepon project commenced gold production from mining primary
gold Mineral Resources.
2025 /H1118/H1118/H1118/H1118/H1118/H1118Plan to make follow-up investments in the Far West Mine, including the
construction of a tailings storage facility; expect to establish a copper ore
processing plant with an annual capacity of 1 million tonnes
2027 /H1118/H1118/H1118/H1118/H1118/H1118Plan to increase our annual gold production to 7 tonnes and our copper
annual production to 30,000 tonnes
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Planned Production Schedule
As set forth in the Competent Person’s Report, the following chart sets forth the planned
mining and production schedule for the operations at the Sepon Gold and Copper Mine for the
periods indicated over the life of mine:
Type Unit LOM
2024
Q4 2025 2026 2027 2028 2029 2030
LXML
Mined Tonnes Gold /H1118/H1118/H1118/H1118/H1118/H1118/H1118kt 7,896 1,435 2,803 1,909 770 546 402 31
Mined Tonnes Copper /H1118/H1118/H1118/H1118/H1118/H1118kt 1,185 447 73 8–––––
Total Mined Tonnes /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118kt 9,081 1,882 3,542 1,909 770 546 402 31
Milled Tonnes Gold /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118kt 7,896 1,435 2,803 1,909 770 546 402 31
Milled Tonnes Copper /H1118/H1118/H1118/H1118/H1118/H1118kt 1,185 447 73 8–––––
Total Milled Tonnes /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118kt 9,081 1,882 3,542 1,909 770 546 402 31
Gold Produced /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118kg 15,963 1,568 5,152 4,912 1,803 1,353 1,108 66
Gold Produced /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118koz 513 50 166 158 58 44 36 2
Copper Produced /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118k t 523–––––
Notes:
1. The planned production schedule of the LOM of 7 years was made based on the data collected of Sepon Gold
and Copper Mine since September 30, 2024.
2. LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year since
September 30, 2024, until all Ore Reserves are extracted in the final year. The forecasted production volume
is estimated based on the designed mining capacity, scheduling strategy and expansion timelines.
Capital Costs
With the reference to the Independent Technical Report, our Directors confirmed that the
capital costs of the Sepon Gold and Copper Mine for the three years ended December 31, 2023
were approximately RMB1,684.0 million. The Independent Technical consultant has reviewed
the breakdown of the capital forecast and considered appropriate capital has been allocated to
support the development of the Sepon Gold and Copper Mines and the basis of the capital cost
estimation is considered reasonable. For detailed capital cost of the Sepon Gold and Copper
Mines, please refer to “Appendix IIIB — Competent Person’s Report for the Sepon Gold and
Copper Mine — Capital Expenditures”.
Operating Costs
In 2022 and 2023, the Sepon Gold and Copper Mine recorded a gold AISC of
approximately US$1,476.9 per ounce and US$1,330.0 per ounce, respectively, showing a
decrease of 9.9% year-on-year.
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The table below sets forth a summary of the forecasted operating costs between 2024 and 2030 for the Sepon Gold and Copper Mine, as stated
in the Competent Person’s Report:
Sepon Gold and
Copper Mine Unit 2021 2022 2023 2024Q1-Q3 LOM 2024Q4 2025 2026 2027 2028 2029 2030
Gold Operation
Labor /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 28.44 22.69 23.10 18.23 71.06 12.91 25.23 17.18 6.93 4.92 3.61 0.28
Material /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 107.81 178.57 140.12 89.35 402.69 73.17 142.96 97.37 39.25 27.86 20.48 1.60
Electricity /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 13.34 12.21 18.39 14.79 55.27 10.04 19.62 13.36 5.39 3.82 2.81 0.22
Contractors /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 0.06 0.03 0.03 0.02 0.15 0.03 0.05 0.04 0.01 0.01 0.01 0.00
Engineering /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 0.01 0.00 0.00 0.00 0.02 0.00 0.01 0.00 0.00 0.00 0.00 0.00
Service /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 0.00 0.00 0.00 0.00 0.01 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Safety /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million – – – – – –––––––
Repairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million – – – – – –––––––
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 0.00 0.00 0.00 0.00 0.02 0.00 0.01 0.00 0.00 0.00 0.00 0.00
Copper Operation
Labor /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 2.14 2.87 4.02 2.91 10.67 4.02 6.6 5–––––
Material /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 7.42 22.21 24.02 14.20 35.56 13.41 22.1 5–––––
Electricity /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 1.02 1.42 3.36 2.30 4.74 1.79 2.9 5–––––
Contractors /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 0.00 0.00 0.00 0.00 0.01 0.01 0.0 1–––––
Engineering /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 0.00 0.00 0.00 0.00 0.00 0.00 0.0 0–––––
Service /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 0.00 0.00 0.00 0.00 0.00 0.00 0.0 0–––––
Safety /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million – – – – – –––––––
Repairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million – – – – – –––––––
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 0.00 0.00 0.00 0.00 0.00 0.00 0.0 0–––––
LXML
Taxes and surcharges /H1118USD million 17.22 19.97 21.66 16.71 54.49 11.29 21.25 11.46 4.62 3.28 2.41 0.19
Selling costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 0.07 0.05 0.06 0.03 0.18 0.04 0.07 0.04 0.02 0.01 0.01 0.00
G&A costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 16.85 4.50 18.45 13.05 45.41 9.41 17.71 9.55 3.85 2.73 2.01 0.16
R&D costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million – – – – – –––––––
Total costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 194.40 264.54 253.22 171.60 680.28 136.12 258.66 149.01 60.06 42.64 31.34 2.45
Notes:
1. The calculation of the operating costs of the Life of Mine was made based on the data collected of the Sepon Gold and Copper Mine since September 30, 202 4.
2. LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year since September 30, 2024, until all Ore Reserves are extracted in the final
year. The forecasted production volume is estimated based on the designed mining capacity, scheduling strategy and expansion timelines. For detail s, please refer to the mine
schedule set forth in “Business — Development Plan and Planned Production Schedule — Planned Production Schedule”.
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Risks Associated with the Sepon Gold and Copper Mine
The mining industry is inherently associated with a high level of risk, which is
accumulated due to factors such as the nature of ore body, ore distribution, grade and variations
in mining and ore processing which are not able to be accurately predicted or accounted for.
The following table sets forth a selected summary of the risk assessment regarding the material
risks undertaken by the Independent Technical Consultant, including the assessment result and
the ratings of the relevant risks. For more details and recommendations for actions to mitigate
technical risks associated with the Sepon Gold and Copper Mine, please refer to “Appendix
IIIB — Competent Person’s Report for the Sepon Gold and Copper Mine — Risk Assessment.”
Material Risk Assessment of the Sepon Gold and Copper Mine
Risk Source/Issue Likelihood Consequence Overall
Geology and Resource
Lack of Significant Ore Reserves /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Possible Major High
Unexpected Groundwater Ingress /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Unlikely Minor Low
Ore Processing
High Production Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Possible Minor Low
Capital and Operating Costs
Project Timing Delays /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Possible Minor Low
Operating Cost Underestimated /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Likely Minor Medium
Operating Process of Gold Production Business in Laos
(a) Overview
During the Track Record Period, our gold production operations in Laos can generally be
divided into two steps, namely, (i) mining and (ii) processing. The following diagram sets forth
the general workflow of the production process:
Sulphuric Acid
POX
Oxide Ore Crushing Milling Thickening CIL
Flotation Tails Dewatering
Tails to TSF
MillingCrushing
Loaded Carbon
Elution
Concentrate
Dewatering
Electrowinning AcidulationMaterial & Product
Operation Smelting CCD
CCD
CIL
Detoxification
1st Neutralization
2nd Neutralization
Gold Doré
Tailings to TSF
Primary Ore
Legend:
O/F
O/F
U/F
U/F
Sepon Gold Recovery Flowchart
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(b) Mining
In relation to mining, we generally follow the open-pit mining method, and details of that
workflow are set forth below:
 Planning . We undertake detailed planning prior to actual production, which covers
mine bench, rock stripping and rock extraction.
 Preparation and cutting . We conduct extensive preparation. Then we drill holes in
the rock wall, charge such holes with explosives and blast the rock wall.
 Extraction . We transport the ore by trucks through mine benches and discharge
earth.
To a lesser extent, we also adopt the underground mining method and details of that
workflow are set forth below:
 Planning . We carry out detailed planning prior to production, which involves
economic analysis to mine the ore, including access design, stope design, drilling
plans, and sequencing of the stopes.
 Development . We develop access to the ore body through the construction of ramps,
levels, and ore drives. This includes the excavation of tunnels to reach the ore zones.
 Drilling and Blasting . Once development is complete, we drill long, parallel holes
into the ore body using longhole drills. These holes are charged with explosives and
blasted to break the ore.
 Loading and Hauling . The broken ore is collected using remote-controlled loaders
and transported to stockpiles or directly to haulage trucks. The ore is then
transported from the underground workings to the surface.
 Ventilation and Dewatering . We maintain proper ventilation systems to ensure air
quality and manage water ingress through dewatering systems.
 Support and Stability . We ensure ground stability by installing ground support
systems such as rock bolts and shotcrete as needed.
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(c) Processing
In relation to processing, we utilize the flotation-pressure oxidation method to process
both primary ores and oxide ores. Our plants mainly include crushing circuits, milling circuit,
flotation circuit, pre-heated vessel, pressure oxidation facility, autoclave vessel and stripping
facility. Details of the processing workflow for primary ores are set forth below:
 Primary crushing and grinding . Typically, mined ores are crushed through
crushing circuit. Crushed ores will be stockpiled and fed into the milling circuit.
 Flotation . The milled ores are pumped into flotation circuit, including scavenger
flotation. The flotation tails will be dewatered and discharged to tailings storage pit.
 Acidulation and pressure oxidation . The final flotation concentrate is used for
acidulation where acid source is used for carbonate removal. The concentrate will
then be pumped into the pre-heater vessel, the pressure oxidation facility and then
the autoclave vessel, where the sulphides and pyrites are oxidized. The products will
undergo the basic ferric sulphate dissolution process and then washed.
In addition, details of the processing workflow for oxide ores are set forth below:
 Oxide grinding . Typically, mined ores are processed through milling circuit and
then pumped for cyanidation with air and lime addition.
 Carbon in leach, elution and gold room . The ores are leached by using sodium
cyanide with air injection. Loaded carbon is transferred into the stripping facility for
elution and the final gold will be poured within the gold room.
 Cyanide destruction and neutralization . The residues of carbon in leach will go
through detoxification where chemicals are added for cyanide destruction. The final
tails will go through neutralization before tailing disposal.
Exploration Activities for Gold Production Business in Laos
Our exploration activities for the gold production business in Laos are primarily
conducted by our in-house exploration team, which has a well-defined strategy aimed at
extending the mine life through the discovery of substantial ore deposits.
Exploration Process
In the realm of mining geology in Laos, our exploration process is systematic,
encompassing preliminary research, data analysis, detailed drilling, sampling, interpretation of
mineralization controls, and geological modeling. We dynamically allocate exploration
resources based on real-time analysis of risks and uncertainties.
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For surface exploration in Laos, we consider various factors, including experience and
qualifications, when collaborating with third parties. After exploration is completed, reputable
mining consultancy firms prepare the relevant exploration reports. All exploration activities
strictly adhere to Laos’s national safety production standards, environmental protection
regulations, and mining laws. Local authorities may request us to submit technical reports for
reference before commencing mining projects.
In-house Exploration Teams
Our in-house exploration teams at the Sepon Gold and Copper Mine focus on accelerating
the exploration of quality greenfields opportunities in remote areas that were previously
inaccessible. The teams are responsible for conducting exploration drilling at near-mine
prospects and regional greenfields targets. The exploration process involves airborne
geophysical surveys, stream sediment surveys, soil and ground geophysical surveys, geological
mapping, trenching, and pattern drilling.
Third-party Exploration Teams
In addition to our in-house capabilities, we also engage third-party exploration service
providers for specific tasks. When selecting these teams, we consider their experience,
reputation, qualifications, and technical conditions. Our technical staff supervises and manages
the work of these third-party teams, ensuring compliance with all applicable laws and
regulations in Laos related to occupational safety and environmental protection. These
third-party teams contribute to our stratigraphic studies, structural interpretations, and refining
of gold and copper targeting models, leveraging their expertise to enhance our exploration
strategy.
The following table sets forth a selected summary of the key recommendations made by
the Independent Technical Consultant towards our Sepon Gold and Copper Mine and the
relevant measures that have been taken or will be taken and the expected time frame.
Key Recommendations Measures and time frame
To further conduct feasibility studies to
develop currently available Mineral
Resources in order to extend the mine life
of the project /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
We continue to conduct feasibility studies
to progress Mineral Resources into
production to extend the life of the mine.
For example, in order to better understand
the resources available and attempt to turn
known resources into profitable mining
operations, we have committed to
exploration drilling and resource drilling
for the next three years in the development
of the Khanong primary copper deposit and
the Far West Prospects gold deposit.
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Key Recommendations Measures and time frame
To proactively manage the environmental
and mine closure issues during the
production, in order to reduce the
high mine closure cost at the end of
the mine /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
We have been using mining waste during
our production process to backfill depleted
pits and create waste dumps that align with
our final closure plans. Our environmental
department also implements a progressive
rehabilitation program, initiating
rehabilitation activities in areas that are no
longer in use and conform to the final
profiles. Furthermore, we review the
closure fund annually to identify areas
where rehabilitation has been completed,
allowing for a reduction in the fund, and to
set targets for further progressive
rehabilitation efforts.
OUR GOLD PRODUCTION BUSINESS IN GHANA
Overview
In January 2022, we acquired a 62% equity interest in Golden Star Resources, which in
turn indirectly holds a 90% equity interest in GSWL, for a consideration of US$291 million.
The remaining 38% equity interest in Golden Star Resources is held by the China-Africa Fund
for Industrial Cooperation Co., Ltd. (ப΂ʮ̡), and the remaining 10%
equity interest in GSWL is held by the Government of Ghana. The mining areas are located
around Akyempim Village in the Wassa East District in the Western Region of Ghana,
approximately 150 kilometers west of Accra, the capital of Ghana. It is on the renowned
Ashanti gold belt, which is the largest gold metallogenic belt in Ghana. Before our acquisition,
Golden Star Resources was listed on the NYSE American (NYSE American: GSS), the Toronto
Stock Exchange (TSX: GSC) and the Ghana Stock Exchange (GSE: GSR). Following our
acquisition, Golden Star Resources was delisted from each of these stock exchanges and now
operates as a privately-held company.
Ghana is a former British colony with a relatively sound legal system and attaches great
importance to the development of its mining industry. Since 2021, Ghana’s national gold output
has surpassed that of South Africa to become the largest gold producer in Africa in terms of
annual production. According to Frost & Sullivan, the political environment in Ghana is stable,
and the jurisdiction is suitable for long-term investment with low political risk. Ghana,
commonly known as the Gold Coast, is home to several large mines and major international
mining companies, such as Newmont Corporation, Gold Field Limited and AngloGold Ashanti
Limited. For details, please see “Regulatory Overview.”
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The mining areas held by the Wassa Gold Mine generally include (i) the Wassa mining
area, (ii) the Hwini Butre mining area, and (iii) the Benso mining area. These mining areas
have experienced local small-scale and colonial mining activities since the beginning of the
20th century. Golden Star Resources acquired the mining rights to its Wassa mining area from
a syndicate of banks led by Standard Bank London Limited in September 2003. This was
followed by the acquisitions of the mining rights in Hwini Butre and Benso mining areas in late
2006.
The Wassa Gold Mine commenced open pit production in 2005 and started commercial
underground production in 2017. It currently adopts a combination of underground mining and
open pit mining, with a focus on underground mining. The mining areas are equipped with
well-developed production systems, complete underground equipment and facilities, a
processing plant and necessary production equipment. It has a designed annual mining capacity
of approximately 3 million tonnes and a designed annual processing capacity of approximately
4 million tonnes. During the Track Record Period, it had produced approximately 461.5 koz of
gold. The main products of the Wassa Gold Mine are doré with more than 80% gold content.
Father Brown Mine is one of the open-pit mines within GSWL’s portfolio of mines. The
Father Brown Mine is independent of the Wassa Mine, as it is within the Hwini-Butre mining
lease (a concession south of Wassa) with the validity until August 2031. The mining activities
were suspended in 2013. After the completion of feasibility study in June 2024, we believe it
is economically feasible to resume the operation of the Father Brown Mine. We intend to
conduct partial trial mining and, following additional verification work, aim to resume
production.
Operation Performance
In January 2022, we acquired a 62% equity interest in Golden Star Resources, which in
turn holds a 90% equity interest in GSWL, and we began consolidating the accounts of Golden
Star Resources from February 1, 2022. As such, ore mined volume, ore processed volume and
mine production volume of GSWL prior to February 1, 2022 was not included in our Group.
For more details, please see “Financial Information — Key Factors Affecting Our Results of
Operations — Acquisitions — Acquisition of Golden Star Resources.”
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In 2022 and 2023 and the nine months ended September 30, 2024, our gold production business in Ghana produced 162.1 koz, 161.5 koz and
138 koz of gold, respectively. The following table sets forth the ore mined volume, ore processed volume and mine production volume in relation
to gold by Wassa Gold Mine for the periods indicated.
Y ear Ended December 31, Nine Months Ended September 30,
2023
Nine Months Ended September 30,
20242021 2022 2023
Ore
Mined
Ore
Processed
Gold
Production
Processing
Capacity
Utilisation
Rate
Ore
Mined
Ore
Processed
Gold
Production
Processing
Capacity
Utilisation
Rate
Ore
Mined
Ore
Processed
Gold
Production
Processing
Capacity
Utilisation
Rate
Ore
Mined
Ore
Processed
Gold
Production
Processing
Capacity
Utilisation
Rate
Ore
Mined
Ore
Processed
Gold
Production
Processing
Capacity
Utilisation
Rate
(kt) (kt) (koz) (kt/a) (kt) (kt) (koz) (kt/a) (kt) (kt) (koz) (kt/a) (kt) (kt) (koz) (kt/a) (kt) (kt) (koz) (kt/a)
Wassa Gold Mine /H1118/H1118 – – – – – 2,024 1,969 162.1 2,700 73% 2,530 2,551 161.5 2,700 94% 1,920 1,850 116 2,025 91% 2,211 2,300 138 2,025 114%
Notes:
1. In 2023, the volume of ore processed was higher than the volume of ore mined, primarily because some of the ore mined in 2022 was kept as inventory and pr ocessed in 2023,
thus increasing the aggregated amount of the ore processed in 2023.
2. Utilization rate is calculated by dividing the amount of ore processed by the processing capacity. For the nine months ended September 30, 2024, the utilisation rate was over
100%. This was mainly because the process plant actually operated for more days than the planned schedule as the annual maintenance work took less than the anticipated time.
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The gold production volume of the Wassa Gold Mine remained relatively stable at 162.1
koz and 161.5 koz in 2022 and 2023, respectively. The gold production volume was increased
by 18.9% to 138.1 koz as of September 30, 2024 from 116.1 koz as of September 30, 2023
mainly due to the contribution of production volume from the construction of two new declines
since in July 2023.
In 2022 and 2023 and in the nine months ended September 30, 2024, the processing
recovery rate of Wassa Gold Mine was 95.6%, 95.5% and 95.4%, respectively.
Development and Expansion
We are accelerating the production expansion project at the Wassa Gold Mine, especially
focusing on developing deep orebodies and other mineralised area to the largest extent
permitted by the mining license. According to a preliminary economic assessment, we expect
to build the Wassa Gold Mine into a large-scale gold mine with (i) an annual processing
capacity of approximately 3.3 million tonnes and (ii) an annual production of 353 koz gold by
2028. In order to realize this goal, we will adopt various measures, including carrying out more
exploration activities at different exploration targets, upgrading our mining and processing
infrastructure and maintaining the average gold processing recovery rate.
In addition, the Forestry Commission of Ghana has granted us an entry permit for
exploration at the forest region of the mining area.
Mineral Resources and Ore Reserves
The following table, which is based on the Competent Person’s Report in accordance with
the JORC Code, sets forth the information of our gold Resources in Ghana as of September 30,
2024:
Mineralized
Zone/Block Category Tonnage Au Grade
Au Metal
Contained
Au Metal
Contained
(kt) (g/t) (koz) (t)
Wassa Gold Mine /H1118Measured 6,754 2.97 645 20.08
Indicated 9,984 3.13 1,004 31.24
Inferred 60,893 3.38 6,609 205.53
Total 77,631 3.31 8,258 256.85
Note:
1. Numbers have been subject to rounding. Accordingly, figures shown as totals in the table may not be
an arithmetic aggregation of the figures preceding them.
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The following table, which is based on the Competent Person’s Report in accordance with
the JORC Code, sets forth the information of our gold Reserves in Ghana as of September 30,
2024:
Mineralized
Zone/Block Category Tonnage Au Grade
Au Metal
Contained
Au Metal
Contained
(kt) (g/t) (koz) (t)
Wassa Gold
Mine /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Proved 3,521 2.14 242 7.53
Probable 5,291 2.12 360 11.19
Stockpile 30 1.33 1.27 0.04
Total 8,842 2.12 603 18.76
Note:
1. Numbers have been subject to rounding. Accordingly, figures shown as totals in the table may not be
an arithmetic aggregation of the figures preceding them.
Mining Licenses and Exploration Permits
As of the Latest Practicable Date, GSWL held two valid mining licenses and three valid
exploration permits which covered an aggregate area of approximately 62.45 km 2 and 148.15
km2, respectively.
The mining licenses in Ghana are generally granted with a term of up to 30 years. The
exploration permits are generally renewed every three years. We aim to renew our mining
licenses or exploration permits before their respective expiry dates. As advised by our Ghana
Legal Advisor, there are no explicit regulations limiting the number of times a mining license
or exploration permit may be renewed in Ghana. Our Ghana Legal Advisor does not anticipate
any legal impediment in the renewal process. We do not expect any material legal impediment
in the renewal process.
For details of Ghana mining laws and regulations, see “Regulatory Overview.”
The following table sets forth information regarding the Wassa Gold Mine’s relevant
mining licenses and exploration permits as of the Latest Practicable Date:
Type Serial Number
Geographical
Area (km 2) Effective Period Status
Mining Lease /H1118/H1118/H1118LVDGAST35364682022 63.00 January 26, 2022
to January 25, 2047
Lease
renewed
and in the
process of
ratification.
Mining Lease /H1118/H1118/H1118LVDGAST37993462020 19.45 August 25, 2020
to August 24, 2031
V alid
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Type Serial Number
Geographical
Area (km 2) Effective Period Status
Mining Lease /H1118/H1118/H1118LVDGAST38000372020 43.00 August 25, 2020
to August 24, 2031
V alid
Exploration
Permit /H1118/H1118/H1118/H1118/H1118/H1118
LVB9113/1994 & PL 2/155 24.81 December 13, 2024 to
December 12, 2027
V alid
Exploration
Permit /H1118/H1118/H1118/H1118/H1118/H1118
LVB5528/2005 & PL 2/378 96.44 March 4, 2022 to
March 3, 2025 1
V alid
Exploration
(prospecting)
Permit /H1118/H1118/H1118/H1118/H1118/H1118
LVB1624/2006 & RL2/117 26.9 September 4, 2024 to
September 3, 2027
V alid
Note:
1. We will submit our renewal application prior to the expiry date in accordance with the relevant laws and
regulations, and we and our Ghana Legal Advisor do not expect any legal impediment in the renewal
process for this permit.
As of the Latest Practicable Date, one mining lease (LVDGAST35364682022) of GSWL
had been renewed by the Ghanaian Government, pending Ghana parliamentary ratification as
required by the Ghana constitution. According to our Ghana Legal Advisor, the process of
obtaining the ratification involves multiple governmental institutions of Ghana, including the
Minister for Lands and Resources, Minerals Commission, Cabinet of Ministers and the
Parliament of Ghana, thus the time frame could not be precisely predicted and it usually takes
two to six years. It is stipulated in the subsection 44(4) of the Mining Act of Ghana that if a
holder of a mining lease has made an application for extension of the term, the lease shall
continue in force in respect of the subject of the application before the outcome of the
application is determined. As advised by our Ghana Legal Advisor, our mining operations at
the Wassa Gold Mine would continue uninterrupted under the original mining lease in
accordance with the subsection 44(4) of the Mining Act of Ghana while the renewed mining
lease is under ratification by the Ghana Parliament. Based on the foregoing, we and the Ghana
Legal Advisor do not anticipate any legal impediment to the completion of the ratification
process. With respect to exploration (reconnaissance) permit (LVB1624/2006 & RL2/117), we
submitted an application to convert this exploration (reconnaissance) permit to an exploration
(prospecting) permit on November 27, 2020 to the Minerals Commission of Ghana. The
Minister of the Ministry of Lands and Natural Resources of Ghana by a letter dated January
1, 2023 approved the recommendation of the Minerals Commission to convert this exploration
(reconnaissance) licenses to an exploration (prospecting license). On July 19, 2024, the
Minerals Commission of Ghana brought the approval of the prospecting licenses agreement
before the Ministry of Lands and Natural Resources for signing. A new 3-year prospecting
license dated September 4, 2024 has since been issued to GSWL over an area of 26.92km
2
within the Wassa East District of the Western Region of Ghana. For more details, please see
“Risk Factors — We may fail to obtain, maintain or renew the government permits, licenses
and approvals required for our mining and exploration activities.”
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Development Plan and Planned Production Schedule
Development Plan
The following timeline illustrates key historical and planned milestones in the
development of the Wassa Gold Mine:
Y ear Milestone
2005 /H1118/H1118/H1118/H1118/H1118/H1118CIL (Carbon in Leach) plant commissioned.
2007 /H1118/H1118/H1118/H1118/H1118/H1118Commenced open pit mining at South Akyempim. Construction of haul
road to Hwini Butre.
2012 /H1118/H1118/H1118/H1118/H1118/H1118Commenced drilling to test underground potential below Wassa.
2013 /H1118/H1118/H1118/H1118/H1118/H1118Upgraded plant to 2.7 Mtpa capacity with fresh ore, consolidated mining
at Wassa main pit.
2017 /H1118/H1118/H1118/H1118/H1118/H1118Declared commercial production at Wassa Underground. Defined a deep
definition drilling program, which later became the Southern Extension
zone. Averaged 1,865 ore t/d in underground operations.
2018 /H1118/H1118/H1118/H1118/H1118/H1118Completed open pit mining of the main pit. Increased underground ore
mining rate to 2,945 t/d. Grew Wassa Underground Inferred Mineral
Resource to 5.2 Moz with the addition of the Southern Extension zone.
2020 /H1118/H1118/H1118/H1118/H1118/H1118Completed construction of paste backfill plant and on-site gas-fired
power generation. Underground ore mining rate increased to 4,480 t/d
(1.6 Mtpa).
2023 /H1118/H1118/H1118/H1118/H1118/H1118Commenced construction of B-shoot South and 242 decline.
2025 /H1118/H1118/H1118/H1118/H1118/H1118Plan to conduct partial trial mining in Father Brown Mine and obtain
relevant environmental assessment and production permit.
2025-2027 /H1118/H1118Plan to carry out deep and peripheral exploration, as well as intensified
drilling operations, and initiate the construction of the transition from
surface to underground mining of the Father Brown Mine.
Planned Production Schedule
As set forth in the Competent Person’s Report, the following chart sets forth the planned
mining and production schedule for the operations at the Wassa Gold Mine for the periods
indicated over the life of mine:
Wassa Gold Mine in Ghana Unit LOM 2024Q4 2025 2026 2027 2028
Wassa_Basic Plan
Mined_Tonnes /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118kt 8,812 979 3,209 2,517 1,614 493
Milled Tonnes /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118kt 8,812 979 3,209 2,517 1,614 493
Gold Produced /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118kg 17,955 1,981 6,000 5,533 3,474 967
Gold Produced /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118koz 577 64 193 178 112 31
Wassa_Upside Plan
Mined_Tonnes /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118kt 9,986 979 3,209 2,517 1,614 1,667
Milled Tonnes /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118kt 9,986 979 3,209 2,517 1,614 1,667
Gold Produced /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118kg 19,897 1,981 6,000 5,533 3,474 2,908
Gold Produced /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118koz 640 64 193 178 112 94
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Notes:
1. The planned production schedule for the LOM includes two scenarios: the basic plan and the upside plan. The
upside plan includes residual material in the upper area and material in the lower area, which SRK views as
a potential economic opportunity but does not classify as Ore Reserves due to insufficient technical studies.
Both LOM scenarios span 5 years and were developed based on data collected from the Wassa Gold Mine as
of September 30, 2024.
2. LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year since
September 30, 2024, until all Ore Reserves are extracted in the final year. The forecasted production volume
is estimated based on the designed mining capacity, scheduling strategy and expansion timelines.
Capital Costs
With the reference to the Independent Technical Report, our Directors confirmed that the
capital costs of the Wassa Gold Mine for the three years ended December 31, 2023 were
approximately RMB1,588.7 million. The Independent Technical consultant has reviewed the
breakdown of the capital forecast and considered appropriate capital has been allocated to
support the development of the Wassa Gold Mine and the basis of the capital cost estimation
is considered reasonable. For detailed capital cost of the Wassa Gold Mine, please refer to
“Appendix IIIC — Competent Person’s Report for the Wassa Gold Mine — Capital Cost”.
Operating Costs
In 2022 and 2023, GSWL recorded the gold AISC of approximately US$1,371.2 per ounce
and US$1,197.1 per ounce, respectively, showing a decrease of 12.7% year-on-year.
The table below sets forth a summary of the forecasted operating costs between 2024 and
2028 for GSWL, as stated in the Competent Person’s Report:
Wassa Gold Mine Unit 2022 2023 2024Q1-Q3 LOM 2024Q4 2025 2026 2027 2028
Labor /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 31.75 35.80 29.96 184.97 20.56 67.36 52.83 33.88 10.34
Material /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 58.50 51.72 65.47 333.25 37.03 121.35 95.18 61.05 18.64
Electricity /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 8.03 18.72 9.02 67.85 7.54 24.71 19.38 12.43 3.79
Contractors /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 1.78 10.71 3.43 30.20 3.36 11.00 8.63 5.53 1.69
Engineering /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 4.25 9.29 4.02 33.30 3.70 12.13 9.51 6.10 1.86
Service /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 1.46 1.74 2.56 10.93 1.22 3.98 3.12 2.00 0.61
Safety /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million – – – – –––––
Repairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million – – – – –––––
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 6.99 – 0.33 13.88 1.54 5.05 3.96 2.54 0.78
Taxes and surcharges /H1118/H1118/H1118/H1118/H1118/H1118USD million 13.23 17.96 19.22 63.75 7.08 23.21 18.21 11.68 3.57
Selling costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million – – – – –––––
G&A costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 20.41 16.97 12.76 82.43 9.16 30.02 23.54 15.10 4.61
R&D costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million – – – – –––––
Total costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 146.40 162.90 146.77 820.57 91.19 298.80 234.37 150.31 45.89
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Notes:
1. The calculation of the operating costs of the Life of Mine was made based on the data collected of Wassa Gold
Mine since September 30, 2024.
2. LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year since
September 30, 2024, until all Ore Reserves are extracted in the final year. The forecasted production volume
is estimated based on the designed mining capacity, scheduling strategy and expansion timelines. For details,
please refer to the mine schedule set forth in “Business — Development Plan and Planned Production Schedule
— Planned Production Schedule”.
Risks Associated with the Wassa Gold Mine
The mining industry is inherently associated with a high level of risk, which is
accumulated due to factors such as the nature of ore body, ore distribution, grade and variations
in mining and ore processing which are not able to be accurately predicted or accounted for.
The following table sets forth a selected summary of the risk assessment regarding the material
risks undertaken by the Independent Technical Consultant, including the assessment result and
the ratings of the relevant risks as well as recommendations for actions to mitigate technical
risks. Please refer to “Appendix IIIC — Competent Person’s Report for the Wassa Gold Mine
— Risk Assessment” for more details and recommendations for actions to mitigate technical
risks.
Material Risk Assessment of the Wassa Gold Mine
Risk Source/Issue Likelihood Consequence Overall
Geology and Resource
Overestimate of Resource Grade /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Possible Moderate Medium
Unexpected Groundwater Ingress /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Possible Moderate Medium
Ore Processing
Higher Processing Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Possible Moderate Medium
Project Timing Delays /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Unlikely Moderate Low
Capital Cost and Operating Cost Increases /H1118/H1118Possible Moderate Medium
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Operating Process of Gold Production Business in Ghana
(a) Overview
Our gold production operations in Ghana can generally be divided into two steps, namely, (i) mining and (ii) processing. Our mines in Ghana
are also equipped with processing plants to process the ores that we mine into doré. The following diagram sets forth the general workflow of the
production process:
DUMP TRUCK
ROM Bin
Vibrating
Grizzly
CV01 Single
toggle Jaw
Crusher
CV02
weightometer
Regeneration Kiln
Quench carbon screen
Carbon Safety Screen
Carbon basket
CIL tanks
Recovery
screen
Acid wash
cone
Elution
column
Strip solution
tank
Smelting furnace
Calcine oven (2x)
Bullion bars
Sump 5 with
cyanide addition
Head
Autosampler
Pre-leach High rate Thickener
Secondary Cyclone
cluster 1
Secondary Cyclone
cluster 2 Sump 4
Sump 3
Paste Back Fill Plant
Tailings Storage facility
Tails
Autosampler
Sump 6
Barren carbon hopper
Secondary
Screen
CV03
CV16
CV17
CV04
CV05
CV07
CV08 & 09
CV11
CV13
U/F
U/F
U/S
U/F
O/F
O/F
Primary Cyclone
cluster 2
Knelson conc 2
Knelson conc 1
Concentrate tk 2
Primary Cyclone
cluster 1
Scalping screen 1
Scalping screen 2
Concep Acacia
CS 3000 ILR &
EW Cell
Concentrate tk 1
Trash screen
Trash
material
Splitter
box
O/F
U/S U/F
O/S
O/S
U/S
O/F
O/F
O/F
U/F
U/F
U/F
O/S
Ball mill 2
Ball mill 1
scats
scats
Sump 2
Sump 1
CV12
COS
Lime Silo
weightometer
weightometer
weightometer
Belt feeders X4
CV10
GOLDEN STAR W ASSA PROCESSING PLANT
Quaternary
cone
Crushers X4
Tertiary
bin
Tertiary
cone
Crushers
X2
Tertiary
Screens X2
Quaternary
bin
CV06
Secondary
cone Crusher
Apron
feeder
ROM
FE WHEEL LOADER
Thickener overflow tank
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(b) Mining
In relation to mining, the Wassa mining area primarily utilizes the open-pit mining
method and the sub level open stoping method.
Details of the open-pit mining workflow are set forth below:
 Planning . We undertake detailed planning prior to actual production, which covers
mine bench, rock stripping and rock extraction.
 Preparation and cutting . We conduct extensive preparation. Then we drill holes in
the rock wall, charge such holes with explosives and blast the rock wall.
 Extraction . We transport the ore by trucks through mine benches and discharge
earth.
In relation to the long-hole mining workflow, it generally follows the similar processes
and methods as we adopt for mining process for gold production business in the PRC. For
details, see “— Our Gold Production Business in China — Operating Process of Gold
Production Business in the PRC.”
(c) Processing
We primarily utilize the gravity-flow all-slime cyanidation absorption gold extraction
method. Our plants mainly include crushing circuits, grinding circuits, gravity-flow
concentrator, pressure filters and conveyers. Details of the processing workflow are set forth
below:
 Crushing circuit . Typically, ores from the underground are crushed in multi-stages
of closed-circuit crushing.
 Grinding circuit . The final crushed ore is ground in a grinding circuit operated in
a closed circuit.
 Gravity flow . The ore is transferred into centrifugal separator and separated into
concentrate and tailings. The concentrate will be used for leaching and the tailings
will be transferred back to grinding circuit.
 Cyanidation leaching . Ore pulp is absorbed through multi-cyanidation leaching.
 Replacement . Replaced gold concentrate is obtained through purification,
deoxidation and replacement by zinc powder or carbon.
 Tailings dewatering . Gold concentrate is dewatered by pressure filter and
decyanated by chemicals and then separated from tailings.
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Exploration Activities for Gold Production Business in Ghana
Our exploration activities for gold production business in Ghana are mainly carried out
by third-party exploration service providers and to a lesser extent our in-house exploration
team.
Exploration Process
Before commencing any exploration activities the Wassa Gold Mine geology group will
gather relevant information related to the exploration target. Our group then drafts an
exploration plan for the area, considering the Wassa Gold Mine’s objectives for the year. This
plan may include diamond drilling, reverse circulation drilling, mapping, soil sampling, grab
sampling, or any other suitable exploration technique for the target.
The exploration plan is then presented to our management for review and approval. Upon
approval, third-party exploration teams will conduct more in-depth research, which may
include topographic surveying, geological mapping, trench exploration, drilling exploration,
pit exploration, geological sample collection and analysis, as well as identifying and
determining the position, size, grade and other key information of the relevant minerals. They
may also need to conduct relevant hydrogeology and engineering geology work to ascertain the
mining technical conditions.
Once approved, the plan is implemented, with the geology group managing the work
program. If the exploration program requires drilling, third-party drilling service providers are
engaged. These service providers supply the drill rigs, manpower, and tooling required to
complete the planned drilling program.
After the field work is completed, the third-party exploration teams prepare the
exploration report for our review. The exploration report might then be submitted to relevant
governmental authorities for evaluation and filing. Upon completion of the program, the
exploration results are reviewed and communicated to management and any applicable
government authority.
Third-party Drilling Service Providers
When selecting third-party exploration teams and drilling service providers, the Wassa
Gold Mine generally considers factors such as experience, reputation, qualification, and
technical ability. Our technical staff from relevant production departments and geology staff
are responsible for supervising and managing the work of third-party exploration teams and
drilling service providers. Our third-party exploration team drilling service providers are
required to work in strict accordance with all applicable Ghanaian laws and regulations related
to occupational safety and environmental protection.
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In-house Exploration Teams
The Wassa Gold Mine also utilizes its in-house exploration team and geology group to a
lesser extent. This group conducts preliminary geological studies, such as collecting relevant
materials and geological mapping, to understand the geological features of the relevant areas.
Our Company also employs dedicated geomechanics, geotechnical engineers, and
hydrogeologists to conduct on-site hydrology, hydrogeology, and geotechnical geology studies.
The exploration design plan is then submitted to the technology management department
for review and approval, and this process may involve the expertise of external geology
experts. Third-party exploration teams will then carry out the relevant physical explorations,
chemical explorations, and drilling explorations according to the design plan. When selecting
third-party exploration teams, we generally consider factors such as experience and
qualifications. After the exploration is completed, a reputable mining consulting firm prepares
the relevant exploration report. All exploration activities are carried out in strict compliance
with the JORC Code as well as relevant laws related to work safety, environmental protection,
and mining. The local government may request us to submit technical reports for reference
before commencing mining projects. For relevant risks relating to our exploration activities,
see “Risk Factors — Risks Relating to Our Business and Industry — We may not be able to
expand or replenish our Mineral Resources and Reserves through exploration.”
The following table sets forth a selected summary of the key recommendations made by
the Independent Technical Consultant towards our Wassa Gold Mine and the relevant measures
that have been taken or will be taken and the expected time frame.
Key Recommendations Measures and time frame
To maintain and enhance the geological
exploration, such as mapping the
underground tunnels, especially for faults
and fractures, and monitoring the
underground water discharges
We have been continuously mapping
subsurface ore drift developments
geologically.
To carry out continuous exploration for the
upgrade the underground Mineral
Resources. As the geological risks also
related to the grade estimation of
underground Mineral Resources, it is noted
there are abundant Inferred Mineral
Resources for the underground mine and
further exploration potential, and the
current Inferred Mineral Resources in
deeper zones have been estimated on
primarily drill core interceptions with
sparse distance so there is possibility of
underestimate or overestimate
We have an in-depth analysis completed by
a professional consulting firm. A
professional mine planning software is in
place and in use for all mine planning
activities, for both short and medium-to-
long term, at Wassa Gold Mine, with
formal training completed on all mining
engineers working within the planning
department.
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Key Recommendations Measures and time frame
To improve the quality of grade control
model and incorporate it into the Mineral
Resource/Ore Reserve model
A quarterly model update schedule has
been established to ensure that the updated
grade control models are incorporated into
the Mineral Resource model.
To carry out in-depth engineering studies
associate to LoM planning and the use of
professional mine planning software and to
source and retain professional services, if
needed
The subsurface production rates attained at
Wassa over the last two years have been
thoroughly examined, and the results,
along with advice from a reputable
consulting firm, have been translated into a
set of approved input parameters.
To properly manage the grade control
and plan in order to reduce operating costs
Detailed geo-metallurgical tests will be
performed on drill samples to integrate into
the grade control and planning process,
ensuring that processing and metallurgy are
adequately informed before ores from the
stopes are processed. Additionally,
reevaluating known surface mineralization
at higher gold prices, along with further
exploration activities, will help secure
additional future ore supplies.
To carry further test works on the deep
underground veins to assure the processing
procedures and laboratory protocols being
used are appropriate and suitable, which
could be dependent on future exploration
programs and technical studies
We plan to continue drilling at Wassa
Deeps, with several holes expected to be
completed in the near future. Met test work
is planned on core obtained from Wassa
Deep drilling campaigns to firm up
processing parameters.
OUR OTHER MINERAL RESOURCES PRODUCTION BUSINESS
Our Other Mineral Resources Production Business in China
Overview
Hanfeng Mining in the PRC primarily engages in mining of polymetallic ore including
zinc, lead, copper and molybdenum. The main products include zinc concentrate powder, lead
concentrate powder (containing silver), copper concentrate powder (containing silver) and
molybdenum concentrate powder.
Hanfeng Mining was established in September 2004 and became part of our Group upon
completion of the acquisition of its entire equity interest in November 2019. The Hanfeng
Polymetallic Mine has two main underground mining areas: (i) the Lishan Mining Area ( ͭʆ
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ᘤਜ), which mainly produces zinc, with lead and copper as co-product minerals, as well as
lead, copper and silver as by-product minerals; and (ii) the Dongfeng Mining Area (ᘤਜ),
which mainly produces zinc, with copper and molybdenum as co-product minerals, as well as
lead as by-product minerals. The Hanfeng Polymetallic Mine has a designed annual mining
capacity of approximately 699,000 tonnes and a designed annual processing capacity of
approximately 825,000 tonnes.
The mining areas of the Hanfeng Polymetallic Mine are located at Laotougou Town,
Longjing City, Y anbian Korean Autonomous Prefecture, Jilin Province, which is designated as
the key exploration area for important Mineral Resources (lead and zinc ore) according to the
National Mineral Resources Planning (2016-2020) ( Ό਷ᘤପ༟๕஝ྌ(2016-2020 ϋ)). Due to
the superior metallogenic geological conditions, this area has an important concentration area
of polymetallic mineralization.
Operation Performance
The following table sets forth the ore mined volume, ore processed volume and mine
production volume of the Hanfeng Polymetallic Mine for the periods indicated:
Y ear Ended December 31,
Nine Months
Ended
September 30,
2023
Nine Months
Ended
September 30,
20242021 2022 2023
(kt) (kt) (kt) (kt) (kt)
Ore Mined /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118510 502 457 247 549
Ore Processed /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118506 579 434 220 534
Processing Capacity
Ore Processed
Hanfeng Polymetallic Mine
– Polymetallic metals /H1118/H1118660 660 660 500 675
Utilisation Rate /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111877% 88% 66% 44% 79%
Production Volume
Zinc concentrate
powder /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819.93 22.04 11.29 5.55 10.18
Lead concentrate
powder /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183.48 3.31 2.72 1.43 2.63
Copper concentrate
powder /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.93 2.05 1.44 0.63 1.19
Molybdenum concentrate
powder /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 0.04 0.21 0.07 0.49
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The following table sets forth the processing recovery rate of the Hanfeng Polymetallic
Mine by its principal products for the periods indicated:
Y ear Ended December 31,
Nine Months
Ended
September 30,
20242021 2022 2023
Zinc concentrate powder /H1118/H1118/H111887.5% 88.3% 89.2% 87.7%
Lead concentrate powder /H1118/H1118/H111864.5% 59.6% 71.7% 66.4%
Copper concentrate powder /H1118 61.2% 49.8% 54.4% 49.0%
Molybdenum concentrate
powder /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 78.5% 79.7%
Development and Expansion
As reported in December 2020, we discovered additional Reserves of 542,600 tonnes of
zinc, 30,900 tonnes of copper (including co-product and by-product), 28,600 tonnes of lead and
131 tonnes of silver in the deep ore bodies of the Lishan Mining Area. As a result, we
undertook a project to building over 1,000 meters of shafts in 2022 in order to exploit the newly
discovered Resources. Upon completion, this project will assist us to enter the next stage of
development and construction and to further improve output. We also plan to undertake work
on a ventilation shaft and a mining development system.
The Dongfeng Molybdenum Mine is expected to begin construction in 2025. Currently,
the mine is preparing the feasibility study report. The projected annual mining capacity is 1.65
million tonnes per year, using underground mining methods, with an annual production of
3,990 tonnes of molybdenum concentrate at 47% Mo content. The estimated life of mine is 33
years.
Mineral Resources
The following table, which is based on the Competent Person’s Report in accordance with
the JORC Code, sets forth the information of our non-ferrous metal Resources and Reserves
in the PRC conducted through our subsidiary, Hanfeng Polymetallic Mine, which includes two
mining areas, namely Lishan Mining Area and Dongfeng Mining Area, as of September 30,
2024:
Lishan Mining Area Dongfeng Mining Area
Category Tonnage Zn Grade
Zn Metal
Contained Cu Grade
Cu Metal
Contained Pb Grade
Pb Metal
Contained Tonnage Mo Grade
Mo Metal
Contained
(kt) (%) (kt) (%) (kt) (%) (kt) (kt) (%) (kt)
Measured /H1118/H1118/H1118/H1118/H1118752 2.36 18 – – 0.12 1 1,819 0.11 2
Indicated /H1118/H1118/H1118/H1118/H11188,583 2.66 229 0.07 6 0.12 10 26,495 0.12 32
Inferred /H1118/H1118/H1118/H1118/H1118/H111810,616 2.9 308 0.09 10 0.13 14 37,053 0.12 45
Total /H1118/H1118/H1118/H1118/H1118/H1118/H111819,951 2.78 554 0.08 16 0.13 25 65,367 0.12 79
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Note:
1. Numbers have been subject to rounding. Accordingly, figures shown as totals in the table may not be an
arithmetic aggregation of the figures preceding them.
Mining Licenses and Exploration Permits
As of the Latest Practicable Date, Hanfeng Mining held a total of two valid mining
licenses, including (i) one for the Lishan Mining Area, and (ii) one for the Dongfeng Mining
Area. Its mining licenses covered a total area of approximately 4.65 km
2. In addition, as of the
Latest Practicable Date, Hanfeng Mining held one valid exploration permit, which covered a
total area of approximately 2.3 km
2.
The mining licenses are generally valid for several years to 30 years. The exploration
permits are generally valid for five years and renewed accordingly subject to some conditions.
We aim to renew our mining licenses or exploration permits before their respective expiry
dates. As advised by our PRC Legal Advisor, there are no explicit regulations limiting the
number of times a mining license or exploration permit may be renewed in the PRC. We and
our PRC Legal Advisor do not expect any material legal impediment in the renewal process if
we submit our application in accordance with the relevant laws and regulations. For details of
the PRC mining laws and regulations, see “Regulatory Overview.”
The following table sets forth information regarding the relevant mining licenses and
exploration permits for Hanfeng Mining as of the Latest Practicable Date:
Type Serial Number
Geographical
Area (km 2) Effective Period Status
Mining license /H1118/H1118C2224002021083210152512 2.2250 August 27, 2021 to
August 27, 2050
V alid
Mining license /H1118/H1118C2200002010123120093830 2.4207 February 25, 2025 to
February 24, 2030
V alid
Exploration
Permit /H1118/H1118/H1118/H1118/H1118/H1118
T100000202103302800361 2.3191 December 20, 2020 to
December 20, 2025
V alid
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Development Plan
The following timeline illustrates key historical and planned milestones in the
development of the Hanfeng Polymetallic Mine:
Hanfeng Polymetallic Mine
Y ear Milestone
1951 /H1118/H1118/H1118/H1118/H1118/H1118Began large-scale mining
2004 /H1118/H1118/H1118/H1118/H1118/H1118The combined mining and processing capacity of Dongfeng and Lishan
reached 1,000 t/d
2019 /H1118/H1118/H1118/H1118/H1118/H1118Hanfeng Mining merged into our Company
2022 /H1118/H1118/H1118/H1118/H1118/H1118Began construction of the lower part of the Lishan Mining Area (Phase
I project), with a designed capacity of 2,000 t/d
2024 /H1118/H1118/H1118/H1118/H1118/H1118Began designing the deep development project of the Dongfeng
Molybdenum Mine (below 250 meters above sea level), with a designed
capacity of 5,000 t/d
2026 /H1118/H1118/H1118/H1118/H1118/H1118Plan to establish a 5,000-tonne ore processing plant for the Dongfeng
Molybdenum Mine
Planned Production Schedule
As set forth in the Competent Person’s Report, the following chart sets forth the planned
mining and production schedule for the operations in the Hanfeng Polymetallic Mine for the
periods indicated over the life of mine:
Underground Unit LOM
2024
Q4 2025 2026 2027 2028 2029 2030 2031 2032
Hanfeng
Polymetallic
Mine
Mined Tonnes
(Lishan
Lower) /H1118/H1118/H1118/H1118/H1118kt 3,310 – 435 435 426 362 451 434 398 367
Milled Tonnes /H1118kt 3,310 – 435 435 426 362 451 434 398 367
Zinc
Production /H1118/H1118k t 1 5 2 –1 91 81 91 42 42 51 81 5
Notes:
1. The planned production schedule of the LOM of 9 years was made based on the data collected of the Hanfeng
Polymetallic Mine since September 30, 2024.
2. LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year since
September 30, 2024, until all Ore Reserves are extracted in the final year. The forecasted production volume
is estimated based on the designed mining capacity, scheduling strategy and expansion timelines. For details,
please refer to the mine schedule set forth in “Business — Development Plan and Planned Production Schedule
— Planned Production Schedule”.
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Risks Associated with the Mineral Area
The mining industry is inherently associated with a high level of risk, which is
accumulated due to factors such as the nature of ore body, ore distribution, grade and variations
in mining and ore processing which are not able to be accurately predicted or accounted for.
The following table sets forth a summary of the risk assessment undertaken by the Independent
Technical Consultant, including its assessment result and the ratings of the relevant risks as
well as recommendations for actions to mitigate technical risks associated with the Hanfeng
Polymetallic Mine, please refer to “Appendix IIIA — Competent Person’s Report for the PRC
Mines — Risk Assessments”.
Risk Source/Issue Likehood Consequence Risk
Hanfeng Project
Mining
Significantly lacking Ore Reserves /H1118Unlikely Major Medium
Ore Processing
Poor Plant Reliability /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Possible Moderate Medium
Lower Processing Recovery /H1118/H1118/H1118/H1118/H1118/H1118Possible Moderate Medium
Capital and Operating Costs
Project Timing Delay /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Unlikely Minor Low
Capital Cost Increases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Possible Moderate Medium
Exploration Activities for Other Mineral Resources Business in China
During the Track Record Period, our exploration activities for non-ferrous metal
production business in the PRC were carried out our by in-house exploration team as well as
third-party exploration service providers.
Before commencement of exploration activities, the third-party exploration teams will
gather relevant materials for preliminary study of the relevant mine’s geology features to, assist
them to understand the mineral distribution and facilitate search for potential Resources. After
the preliminary study, they will formulate an implementation plan, which sets out detailed steps
for exploration, for our review and approval. Upon approval, the third-party exploration teams
will carry out more in-depth research, including topographic survey, geological mapping,
trench exploration, drilling exploration, pit exploration, geological sample collection and
analysis, identifying and determining the position, size, grade and other key information of the
relevant minerals. They may also need to undertake the relevant hydrogeology and engineering
geology work in order to ascertain the mining technical conditions. After completion of field
work, the third-party exploration teams will prepare the exploration report for our review. Such
exploration report might be submitted to the relevant governmental authorities for evaluation
and filing.
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When selecting the third-party exploration teams, we generally take into account a
number of factors, including experience, reputation, qualification and technical conditions. Our
technical staff from relevant production departments are responsible for supervising and
managing the work of third-party exploration teams, such as the progress of the project and
stage acceptance check. Our third-party exploration teams are required to work in strict
accordance with all the applicable PRC laws and regulations in relation to occupation safety
and environmental protection. For more information on third-party exploration teams, see “—
Contractors.”
When the mine is put into production, the exploration design will be carried out by our
in-house exploration team, where it undertakes preliminary geology study, such as collection
of relevant materials and geology mapping, in order to understand the geology features of the
relevant areas. As we have dedicated geomechanics who undertake on-site hydrology and
geology studies, the design plan will also reflect the relevant engineering and geology
conditions. The exploration design plan will then be submitted to the technology management
department for review and approval, during which external geology experts may be involved
from time to time. Then third-party exploration teams will carry out the relevant physical
explorations, chemical explorations and drilling explorations pursuant to the design plan.
When selecting the third-party exploration team, we generally take into account a number of
factors, including experience and qualification. After completion of the exploration, the
relevant exploration report will be then prepared by reputable mining consulting firms. All
exploration activities are carried out in strict compliance with Chinese national safety
production standards as well as the relevant laws in relation to work safety, environmental
protection and mining. The relevant local government may request us to submit technical
reports for reference before commencement of mining projects.
For relevant risks relating to our exploration activities, see “Risk Factors — Risks
Relating to Our Business and Industry — We may not be able to expand or replenish our
Mineral Resources and Reserves through exploration.”
Operating Process of Other Mineral Resources Business
During the Track Record Period, our other Mineral Resources operations in the PRC can
generally be divided into two steps, namely, (i) mining, and (ii) processing.
Hanfeng Polymetallic Mine primarily utilizes the selective mining method for mining in
China. Its mining equipment mainly includes rock drills and loaders. The details of the mining
process are listed as follows:
 Design . Detailed planning is carried out before actual production begins, including
the layout of stopes, pillars, ventilation shafts, ore passes, and backfill entry points.
We generally divide the mining area into different sections, and each section is
treated as a mining unit.
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 Preparatory cutting . A detailed plan is made to drill ventilation shafts, ore passes,
and backfill entry points. After that, we drill holes in the ore body, fill the holes with
explosive materials, and then blast the ore body.
 Mining . Extracting the ore from the rock mass to form a mined-out area. Our mining
method is by stratified mining.
 Ore transportation . We transport the ore to the surface using mine carts through
mine roads and vertical shafts.
 Backfilling . We backfill the mined-out area with various backfilling materials
(including rocks produced by blasting and/or preparatory cutting) to prevent surface
subsidence.
Hanfeng Polymetallic Mine mainly uses the flotation process for processing, which
mainly includes the crushing circuit, grinding and classification circuit, flotation circuit,
concentrate dewatering, and tailings transportation. The details of the processing are listed as
follows:
 Crushing circuit . Generally, we carry out multi-stage closed circuit crushing for the
ore mined underground.
 Grinding and classification circuit . The crushed ore that meets the standards is
processed in a closed circuit.
 Flotation circuit . The ground and classified ore is subjected to flotation, which
includes roughing, multiple scavenging, and cleaning processes.
 Concentrate dewatering . The concentrate is dewatered through a filter press to
separate the concentrate.
 Tailings transportation . The tailings after flotation are transported to the tailings
storage facility.
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The following table sets forth a selected summary of the key recommendation made by
the Independent Technical Consultant towards our Hanfeng Polymetallic Mine and the relevant
measures that have been taken or will be taken and the expected time frame.
Key Recommendation Measures and time frame
Hanfeng Project — to carry out in-fill
drilling exploration and/or underground
exploration for resource category
upgrade to meet life of mine plan of
the lower parts of Lishan Mine and
Dongfeng Mine /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
We are in the process of carrying out shaft
sinking and tunneling works to access the
ore deposits. Assuming all necessary
preconditions are satisfied, the construction
of Lishan Mine is anticipated to be
finalized in the near future. We also expect
to upgrade the reserves and expose the ore
bodies within the next two years.
Meanwhile, Dongfeng Mine is expected to
initiate shaft sinking and tunneling works
within the next two years.
Our Copper Cathodes Business in Laos
Overview
Our copper cathodes business is carried out by our subsidiary LXML in Laos, which has
one production line of copper. It has seven separate copper pits that are actively mined and
produces copper cathode. During the Track Record Period, due to a general decrease of copper
oxide Reserves as well as our refocusing our business strategy from other Mineral Resources
to the expansion of our gold mining business, the copper production volume of the Sepon Gold
and Copper Mine increased from 5,020 tonnes in 2021 to 6,485 tonnes in 2023. However, we
have continued our production of copper through the remaining copper Reserves, and since
2022 we have been studying and testing the feasibility of heap leaching treatment to extract
copper. The Sepon Gold and Copper Mine has a designated annual processing capacity of
approximately 1.4 million tonnes.
Our Copper Cathodes product
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Operation Performance
In 2021, 2022 and 2023 and the nine months ended September 30, 2024, our copper
cathodes business in Laos produced 5,020 tonnes, 6,433 tonnes, 6,485 tonnes and 4,025 tonnes
of copper cathodes, respectively. During the Track Record Period, the copper processing
recovery rate of the Sepon Gold and Copper Mine was 86.4%, 64.5%, 55.7% and 45.0%,
respectively. The following table sets forth the ore mined volume, ore processed volume and
mine production volume in relation to copper cathodes by the Sepon Gold and Copper Mine
for the periods indicated.
Y ear Ended December 31,
Nine Months
Ended
September 30,
20242021 2022 2023
(kt) (kt) (kt) (kt)
Ore mined /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181 4 9–– –
Ore processed /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118255 772 1,105 843.31
Production volume /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 6 6 4.03
Note:
1. The ore mined volume for the Sepon Gold and Copper Mine’s copper mine dropped to zero in 2022,
because the Sepon Gold and Copper Mine resumed gold production in 2020, while only keeping a small
portion of processing capacity for its copper business since then. For the reason behind the halt in gold
production at the copper mine of the Sepon Gold and Copper Mine, see “Business — Our Gold
Production Business in Laos — Overview.” As of the Latest Practicable Date, the Sepon Gold and
Copper Mine did not have any active copper mining projects while only processed the ore from its
stockpile.
Mineral Resources and Ore Reserves
The following table, which is based on the Competent Person’s Report in accordance with
the JORC Code, sets forth the information of our copper Resources in Laos conducted at
subsidiary, LXML, as of September 30, 2024:
Mineralized Zone/Block Category Tonnage Cu Grade
Cu Metal
Contained
(kt) (%) (kt)
Sepon Gold and Copper
Mine – Copper /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Measured – – –
Indicated 4,416 1.45 64
Inferred 2,078 0.98 20
Total 6,493 1.30 85
Note:
1. Numbers have been subject to rounding. Accordingly, figures shown as totals in the table may not be
an arithmetic aggregation of the figures preceding them.
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The following table, which is based on the Competent Person’s Report in accordance with
the JORC Code, sets forth the information of our copper Reserves in Laos conducted at
subsidiary, LXML, as of September 30, 2024:
Mineralized Zone/Block Category Tonnage Cu Grade
Cu Metal
Contained
(kt) (%) (kt)
Sepon Gold and Copper
Mine – Copper /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Proved – – –
Probable 1,185 0.93 11.05
Total 1,185 0.93 11.05
Note:
1. Numbers have been subject to rounding. Accordingly, figures shown as totals in the table may not be
an arithmetic aggregation of the figures preceding them.
Mining Licenses and Exploration Permits
As advised by our Laos Legal Advisor, our copper cathodes business and our gold
production business in Laos are subject to the same mining licenses and exploration permits of
LXML. For details of relevant mining licenses and exploration permits, see “— Our Gold
Production Business in Laos — Mining licenses and Exploration Permits.”
Development Plan and Planned Production Schedule
The development plan and planned production schedule of our copper cathodes business
in Laos is subject to the same development plan of the Sepon Gold and Copper Mine. For
details, see “— Our Gold Production Business in Laos — Development Plan and Planned
Production Schedule.”
As set forth in the Competent Person’s Report, the following chart sets forth the planned
mining and production schedule for the copper operation at the Sepon Gold and Copper Mine
for the periods indicated from 2024 Q4 to 2025:
Type Unit LOM 2024 Q4 2025
Copper Production
Mined Tonnes Copper /H1118/H1118/H1118/H1118/H1118kt 1,185 447 738
Milled Tonnes Copper /H1118/H1118/H1118/H1118/H1118kt 1,185 447 738
Copper Produced /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118k t 523
Note: LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year
since September 30, 2024, until all Ore Reserves are extracted in the final year. The forecasted
production volume is estimated based on the designed mining capacity, scheduling strategy and
expansion timelines.
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Capital Costs
The capital costs of our copper cathodes business in Laos are subject to the same capital
costs of the Sepon Gold and Copper Mine. For details, see “— Our Gold Production Business
in Laos — Capital Costs.”
Operating Costs
The operating costs of our copper cathodes business in Laos are subject to the same
operating costs of the Sepon Gold and Copper Mine. For details, see “— Our Gold Production
Business in Laos — Operating Costs.”
The table below sets forth a summary of the forecasted copper production operating costs
between 2024 Q4 and 2025 for Sepon Gold and Copper Mine, as stated in the Competent
Person’s Report:
Item Unit LOM 2024 Q4 2025
Copper Operation
Labor /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 10.67 4.02 6.65
Material /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 35.56 13.41 22.15
Electricity /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 4.74 1.79 2.95
Contactors /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 0.01 0.01 0.01
Engineering /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 0.002 0.00 0.00
Service /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 0.0004 0.00 0.00
Safety /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million – – –
Repairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million – – –
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD million 0.001 0.00 0.00
Notes:
1, The calculation of the operating costs of the Life of Mine was made based on the data collected of Sepon
Gold and Copper Mine since September 30, 2024.
2. LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year
since September 30, 2024, until all Ore Reserves are extracted in the final year. The forecasted
production volume is estimated based on the designed mining capacity, scheduling strategy and
expansion timelines. For details, please refer to the mine schedule set forth in “Business —
Development Plan and Planned Production Schedule — Planned Production Schedule”.
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Risks Associated with the Sepon Gold and Copper Mine
The risks associated with our copper cathodes business in Laos are subject to the same
risks of the Sepon Gold and Copper Mine. For details, see “— Our Gold Production Business
in Laos — Risks Associated with the Sepon Gold and Copper Mine.”
Exploration Activities for Copper Cathodes Business in Laos
During the Track Record Period, we had been conducting the exploration activities for
copper cathodes business through LXML. Our exploration activities for copper cathodes
business in Laos follow similar processes and methods as we adopt for exploration activities
for gold production business in the PRC. For details, see “— Our Gold Production Business in
China — Exploration Activities for Gold Production Business in China.”
Operating Process of Copper Cathodes Business in Laos
During the Track Record Period, our copper cathodes production operations in Laos can
generally be divided into three steps, namely, (i) mining, (ii) processing and smelting. In
relation to mining, we generally follow the open-pit mining method. For details, see “— Our
Gold Production Business in Laos — Operating Process of Gold Production Business in Laos.”
In relation to processing and smelting, we utilize the flotation-pressure oxidation method
to process both mined ores. Our plants mainly include scrubber circuit, leaching tanks, counter
current decantation circuit, atmospheric leach thickener, mixer-settler, wash dip tank, stripping
machine and neutralization tank. Details of the processing workflow for primary ores are set
forth below and following diagram sets forth the general workflow of the production process:
Pregnant
Leaching Solution
Extraction
Raffinate
Copper
Ore Leaching Solvent
Extraction
Back
Extraction
Electro-
winning
Electrolytic
Copper
Stripped
Organic
Lean
Electrolyte
Loaded
Organic
Pregnant
Electrolyte
 Run of mine and scrubber . Typically, mined ores are crushed and washed by
scrubber circuit in order to screen out the larger particles. The products will then be
sent to leaching tanks.
 Cold acid leach and counter current decantation . Chemical is added into leaching
tank to dissolve copper into solution. Atmospheric leach thickener is used to create
solid underflow stream and clear overflow stream in counter current in order to wash
copper, acid and iron from the solid underflow stream. Additional chemicals will be
added to improve the settling rate.
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 Solvent extraction . The solution (with copper in solution) is pumped into
mixer-settlers with different functions for extraction and the impurities will be
washed out and diluted.
 Electrowinning. Copper is recovered from the solution by connecting direct electric
current. High purity copper cathode metal so generated will grow for certain days
and then pulled and transferred to a cathode wash dip tank. The copper cathode is
later stripped in stripping machine and put into stacks.
 Neutralization . Tailings are pumped into neutralization tanks and then pumped into
tailings storage facility.
Our Rare Earth Business in Laos
Overview
We intend to engage in rare earth business principally through our subsidiary under Chijin
Xiawu, Chixia Laos, in Laos. Rare earth minerals are a scarce resource on a global scale. Due
to the technical difficulties involved in mining these minerals, as well as volume control and
strategic reserves policies implemented by rare earth exporting countries, rare earth minerals
have been in short supply globally for an extended period.
At the beginning of 2021, during the gold and copper exploration activities in the
southern mining area, we discovered ionic medium and heavy rare earth minerals anomalies in
the granite distribution area. We subsequently conducted a general survey on the area and, in
August 2022, we issued a report identifying two areas of mineralisation within the western
scope of the southern mining area that belong to the relatively scarce medium and heavy rare
earth group. The total rare earth oxides in the area are estimated at 32,000 tonnes with average
grade of 0.045%.
In relation to the latest development of our rare earth business, as of the Latest Practicable
Date:
 LXML had submitted an application to the Minister of Planning and Investment of
Laos in relation to rare earth mining right in an area of 2.96 km
2 located within its
mining area. The relevant border verification under this application had been
completed. This application is currently on hold due to Prime Minister Decision
No. 43/PM dated June 24, 2022 regarding selection criteria for rare earth companies
in Lao PDR, and Notification from the Prime Minister’s Office No. 642 dated April
20, 2023.
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 Chijin Laos had submitted an application to the Ministry of Planning and Investment
of Laos in relation to rare earth exploration right in an area of 50 km 2 in the Kham
District of Xiangkhouang Province. This application had been accepted by the
aforementioned governmental authority. Chijin Laos had also submitted two
applications to the Ministry of Planning and Investment of Laos in relation to
prospecting, exploration, and a technical feasibility study on (i) rare earth minerals
within a 19.88 km
2 area in Phouvineg and Phouluang Villages, Hiem District,
Huaphan Province and (ii) gold and associated minerals within a 180 km 2 area in
Giem District, Huaphan Province, respectively. These applications had been
accepted by the aforementioned governmental authority. Currently Chijin Laos’
applications are on hold due to the Cabinet Office of the Prime Minister’s
notification on April 20, 2023 regarding the suspension of all new and pending
applications of all applicants.
 The Ministry of Energy and Mine of Laos had granted Chijin Laos permit in relation
to reconnaissance (investigation) at: (i) the Meang Hiem District in Houaphanh
Province with an area of 198 km
2; and (ii) Huameang District in Houaphanh
Province with an area of 139 km 2. A reconnaissance team consisting of
representatives from Chijin Laos, Lao Mining Development State Enterprise, the
Ministry of Energy and Mines of Houaphance Province and Muang Hiam District
had conducted geological mapping in Muang Hiam City.
As all the applications for the approvals, permits and/or licenses required for the intended
exploration activities of Sepon Rare Earth Element Project are pending review by the relevant
Laos government authorities, LXML had not commenced any exploration activities on rare
earth minerals as of the Latest Practicable Date. The Laos Legal Advisor is of the view that the
status of the pending approvals, licenses and/or permits required for the intended exploration
activities of Sepon Rare Earth Element Project will not have any material impact upon the
planning of the rare earth exploration activities by LXML on the basis that LXML had not
commenced any rare earth exploration activities as of the Latest Practicable Date. Our
Directors are of the view that the relevant applications being put on hold are not expected to
have any material adverse impact on our business, financial condition or results of operations.
In light of the new business opportunity brought by this discovery, we entered into a
strategic cooperation framework agreement with Xiamen Tungsten, a company listed on
Shanghai Stock Exchange, in September 2022, pursuant to which we and Xiamen Tungsten
established a joint venture company to seize the business opportunity brought by rare earth.
Xiamen Tungsten has comprehensive capabilities covering the whole rare earth industry chain,
from mining and processing to product development and research. We believe that this joint
venture will bring together the resources and relevant industry experience to sustainably and
profitably develop these rare earth Resources.
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On March 4, 2024, an equity transfer agreement was entered into among China
Investment, Chixia Laos and Chijin Xiawu, pursuant to which Chixia Laos shall acquire from
China Investment 90% equity interest in China Investment Mining (Laos) Sole Co., Ltd., which
in turn holds an 86% equity interest in CIRE Mining. To the best of the our knowledge, the
suspension of relevant applications for approvals, permits and/or licenses required for the
intended exploration activities of the Sepon Rare Earth Element Project by the relevant local
regulatory authorities is not expected to have a material adverse impact on the Mengkham Rare
Earth Element Project or the acquisition.
The Target Company operates the Mengkham Rare Earth Element Project and has two
subsidiaries which held a rare earth mineral processing permit (experimental), a mineral
extraction permit (experimental) and a rare earth exploration permit. The project is still at the
construction stage covering the mining area of 50 km
2, whereby the genetic type of the mineral
deposit belongs to the weathering curst ion-adsorbed rare earth deposit. To the best of our
knowledge, we confirmed that, as of the Latest Practicable Date, (a) there were no outstanding
permit or license which were pending approval from the Laos regulatory authorities in
connection with this project; and (b) based on the disclosure from the Target Company to us
and the due diligence conducted by us during the acquisition process, the Target Company held
necessary licenses and/or permits to conduct rare earth exploration and operation in all material
aspects.
Operation Performance
During the Track Record Period, we did not produce any rare earth products in Laos.
OUR OTHER BUSINESS
Overview
Our other business primarily comprised recycling of waste electronic products and
electrical appliances through Guangyuan Technology, which was established on August 6, 2003
under the laws of the PRC and acquired by us in July 2015. Guangyuan Technology specializes
in comprehensive utilization of waste resources. It primarily recycles waste electronic products
and electrical appliances. It also recycles and utilizes defective products from manufacturing
enterprises, and scrap materials from governmental institutions, and recycles and disposes of
power batteries. It also collects, stores, and transports hazardous waste. The major customers
of Guangyuan Technology are enterprises in the metal products manufacturing and resource
recycling sectors. We charge our customers by weight at predetermined prices based on the
type of disassembled materials after the processing and recycling, and record revenue on a
gross basis.
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Although Guangyuan Technology operates as a non-core business within our Group, it
contributes to our financial metrics including operating income and net profit. The resources
recycling business is a strategically important sector supported on a national level and further
enhances our ESG efforts. Besides, the resource recycling business is a beneficial complement
to our mining business as it diversifies our revenue sources. According to Frost & Sullivan,
local and national government bodies in the PRC have introduced a series of policies to
encourage and support the development of the industry. As such, the PRC has gradually
established a multi-level recycling system led by enterprises with qualification to recycle waste
electronic products and electrical appliances.
Guangyuan Technology’s primary market is located in Hefei City, Anhui Province, where
it procures waste electronic products and electrical appliances, including computers, monitor
screens, televisions, washing machines, refrigerators and air conditioners. It also has a
presence in more than 30 counties and cities around Hefei City. The main channels for raw
material procurement include:
 Municipal recycling point. We have established various recycling points in five
cities and are gradually expanding with an aim to cover the whole Anhui Province.
 Home appliance sales. We have established strategic cooperation relationships with
leading home appliance companies in Hefei City and assist them recycle trade-in old
home appliance.
 Home appliance manufacturing. We have also established partnership with leading
home appliance manufacturing companies in China and assist them recycle defective
or scraped products.
 Governmental and public institutions. We have been appointed as Provincial
Designated Enterprise for Recycling Scraped Electronic Products and Electrical
Appliances in Anhui (ᓃஈໄΆุ) and assist
various governmental and public institutions, such as schools and hospitals, recycle
waste electronic products and electrical appliances.
 Social welfare organizations. We also cooperate with various social welfare
organizations to recycle waste electronic products and electrical appliances from the
local communities.
Guangyuan Technology has an annual processing capacity of 2.65 million units.
Guangyuan Technology adopts a comprehensive recycling and disposal process integrating
manual disassembling and mechanical disposal followed by comprehensive treatment such as
in-depth mechanical sorting and separation of the disassembled materials. It then delivers the
materials produced in its recycling process to enterprises with hazardous waste management
licenses for utilisation or treatment.
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Guangyuan Technology possesses a Waste Electronic Products and Electrical Appliances
Disposal Certificate (ࣣand is the only company in Hefei City
that qualifies for waste electric and electronic products disposal. Guangyuan Technology
conducts its business process in accordance with the “Guidelines for the Standardized
Dissembling and Disposal Operations and Production Management of Waste Electrical and
Electronic Equipment 2015” (یܸ2015 ϋ
وGuangyuan Technology has been nominated as a New Energy V ehicle Power Battery
Recycling Trail Unit in Anhui Province (อঐ๕ӛԓਗɢႅཥϫΫϗл͜༊ᓃఊЗ)i n
December 2008 and was included in the National Waste Electrical and Electronic Equipment
Treatment Fund Subsidy List (໾൨Τఊ) in September 2013.
Operations of Resource Recycling Business
Guangyuan Technology adopts a comprehensive recycling and disposal technology that
combines manual dismantling and mechanical disposal and carries out in-depth mechanical
sorting and separation of the dismantled materials. The materials generated in the recycling
process are then delivered to enterprises holding hazardous waste operation licenses for
recycling or disposal.
Our standard operation process can be exemplified by our workflow for computer
disassembling. As shown in the flowchart below, we first transport the waste computers into
the disassembling storage place. Then the waste computers are put onto a conveyor belt and
delivered to different sectors for manual disassembling. The computer plastic cases are directly
delivered to the plastic weighing area. We deliver the remaining parts to the sorting area for
further dismantling into different materials, such as fan, battery, central processing unit, main
board etc. In relation to hard drives, these will go through mechanical destruction. The various
materials produced from disassembly will then be placed into recycling bags to be collected by
enterprises with hazardous waste management licenses for utilisation or treatment.
Microcomputer
Hard Drive
Destruction Metal Sorting Plastic
Fan  Central
Processing Unit
Lithium
Cell
Random Access
Memory
Main
Board
Wire and
Cable
Electric
Motor
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Revenue Model of Resource Recycling Business
For the recycling of waste electronic products and electrical appliances, we charge our
customers by weight at predetermined prices based on the type of disassembled materials after
the processing and recycling, and record revenue on a gross basis.
SALES AND CUSTOMERS
Overview
During the Track Record Period, our primary products were gold, copper cathodes and
other Mineral Resources products. Details of our major products as of the Latest Practicable
Date are set out as below:
Business Products
Gold production in the PRC /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Doré with more than 80% gold content,
gold concentrate powder with gold
content of 50g/t and more, or gold-loaded
carbon
Gold production in Laos /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Doré with 30%-80% gold content and
10%-70% silver content
Gold production in Ghana /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Doré with more than 80% gold content
Other Mineral Resources in the PRC /H1118/H1118(i) zinc concentrate powder, (ii) lead
concentrate powder (containing silver),
(iii) copper concentrate powder
(containing silver), and (iv) molybdenum
concentrate powder
Copper cathodes in Laos /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Copper cathodes with Grade A quality
Others (resource recycling) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Dismantled materials
Our average selling price of gold mining business is determined based on the gold metal
contained in the gold products despite the variant grades of the products. For details of the
average selling price, please refer to “Financial Information — Sales volume and Average
Selling Price”.
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Sales in the PRC
Our products are sold to a wide range of customers in China and we adopt different
arrangements to determine the price and facilitate our sales. In relation to our sales of products
in the PRC, we generally enter into sales agreements with our customers on an annual basis
without entering into any long-term agreement. The following table sets forth the major
customers and our pricing and sale arrangement for our sales in the PRC.
Business Major Customers
Customer
Location Pricing and Sales Arrangements
Gold production
in the PRC /H1118/H1118/H1118
Members of the
Shanghai Gold
Exchange, i.e.
precious metal
refiners
PRC We determine the selling price
based on the spot trading price
of the Shanghai Gold
Exchange and the relevant
customer’s agreement.
The settlement price is
determined at the market price
of the spot pricing less
smelting/refining fees and
handling charges. The payment
may be either settled on the
day of the spot pricing or the
immediately following day or
partly settled in advance.
As confirmed by Frost &
Sullivan, the sale of gold in
PRC is not subject to any
governmental regulatory
pricing guidelines.
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Business Major Customers
Customer
Location Pricing and Sales Arrangements
Other Mineral
Resources in
the PRC /H1118/H1118/H1118/H1118/H1118
Large downstream
smelters with
long-term
cooperation
PRC As a general practice, we
determine sales prices based
on the market prices of the
relevant metals contained in
the concentrates, including
zinc, lead, copper, silver and
molybdenum. The prices of 1#
zinc ingot and 1# spot lead
available on the Shanghai
Metals Network and the
settlement price of the spot
copper contract on the
Shanghai Futures Exchange are
largely used as benchmarks.
Settlement prices are
determined based on the actual
metal contents in the refined
powder products, with
transportation costs, weighing
check fees and other factors
taken into account.
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Downstream
enterprises with
hazardous waste
management
licenses for
utilisation or
treatment of
disassembled
waste electronic
products and
electrical
appliances
PRC Sales prices are determined by
reference to the quantity of
disassembled products and the
market conditions and at a
price set by a bidding process.
The goods are available to be
picked up by clients at our
relevant premises on condition
of full payment.
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Sales in Laos
In relation to our sales of products in Laos, we generally enter into sales agreements our
customers for generally one to three years. Given the high quality of our products, various
potential customers have approached us. Accordingly, we believe that it would not be difficult
for us to find alternative customers for sales of products on terms comparable to those we have
with our existing. The following table sets forth the major customers and our pricing and sale
arrangement for our sales in Laos.
Business Major Customers
Customer
Location Pricing and Sales Arrangements
Gold production
in Laos /H1118/H1118/H1118/H1118/H1118
Mainly include
large,
international gold
refiners selected
across the globe
Australia,
Singapore,
Thailand
Based on the current
agreement we may sell up to
90% of the products as per our
laboratory’s assay results at
spot price once gold doré is
handed over to our contracted
transportation service provider
at the mine site’s gold room
and sell all the remaining
products once the refinery’s
results are available at spot
price. The payment may be
either settled on the day of the
spot pricing or the immediately
following business day.
We generally arrange the
products to be transported to
the factory of the customer.
As confirmed by Frost &
Sullivan, the sale of gold in
Laos is not subject to any
governmental regulatory
pricing guidelines.
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Business Major Customers
Customer
Location Pricing and Sales Arrangements
Copper cathodes
in Laos /H1118/H1118/H1118/H1118/H1118
Mainly include
international
commodity traders
The details and terms of the
sales are determined by the
agreement reached by the
parties in accordance with
international trade rules.
Generally, we are paid at a
provisional provision, which is
set at the average price of the
London Metal Exchange in the
previous month. Within three
days after the original bill of
lading is received by the
customer, we receive payment
at the average price of the
London Metal Exchange in the
coming month. We generally
arrange for the products to be
transported to the factory of
the customer.
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Sales in Ghana
In relation to our sales of products in Ghana, we generally enter into sales agreements
with our customers for two years or longer terms. The following table sets forth the major
customers and our pricing and sale arrangement for our sales in Ghana.
Business Major Customers
Customer
Location Pricing and Sales Arrangements
Gold production
in Ghana /H1118/H1118/H1118/H1118
The products are
consigned to large
gold refineries
selected through a
bidding process.
During the Track
Record Period,
our major
customers include
large international
refineries
South
Africa,
Ghana
The pricing is mainly based on
the gold spot price set by the
London Bullion Market
Association as benchmark after
deducting certain relevant fees,
and payments are generally
settled within three business
days of shipment.
We are also subject to
obligations in relation to sales
of doré under a streaming
agreement. For details, see
subsection of “Metal
Streaming” below.
We generally arrange for the
products to be transported to
the relevant factory of the
customer.
As confirmed by Frost &
Sullivan, the sale of gold in
Ghana is not subject to any
governmental regulatory
pricing guidelines.
Customers
During the Track Record Period, the brand and quality of our products were widely
recognized by the market. In addition, we have established long-term and stable relationships
with precious metals refiners and trading companies. We have maintained business
relationships of over three years with our top five customers during the Track Record Period.
In line with industry practice, we generally do not engage in marketing activities. This is
mainly due to the scarcity of gold resources and strong demand for gold. According to Frost
& Sullivan, gold mining has long been considered a sellers’ market, where gold mining
BUSINESS
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companies hold a bargaining advantage over their downstream customers. For our overseas
operation, we mainly identify and procure customers by inviting bids from potential customers.
Domestically, we primarily identify and establishes cooperative relationships with customers
through the Shanghai Gold Exchange. We believe our customers typically would not directly
export our products to other countries, as the majority of our customers are metal refineries,
which would process our products in order to produce gold/copper products for higher purity.
During the Track Record Period, our top five customers in the respective year/period were
refiners of precious metals and other non-ferrous metals as well as trading companies. For each
year/period of the Track Record Period, revenue contributed by our top five customers
amounted to RMB2,946.2 million, RMB5,345.8 million, RMB5,565.6 million and
RMB4,904.6 million, respectively, accounting for 77.9%, 85.4%, 77.1% and 78.8% of our total
revenue for the same periods, respectively. Revenue contributed by our largest customer for
each year/period of the Track Record Period amounted to RMB2,126.6 million, RMB2,602.2
million, RMB2,672.1 million and RMB2,140.1 million, respectively, accounting for 56.2%,
41.5%, 37.0% and 34.4% of our total revenue for the same periods, respectively. The following
tables set out details of our five largest customers in each year/period of the Track Record
Period:
Rank Customer
Type of
Product(s)
Sold
Country/
Region
Nature of
Business
Y ear(s) of
Business
Relationship as
of the Latest
Practicable Date Credit terms Revenue
%o fo u r
Total
Revenue
(RMB’000)
For the nine months ended September 30, 2024
1. ABC Refinery (Australia)
Pty Ltd
Gold Australia Refinery 4 Up to 90%
prepayment
2,140,263 34.4
2. Rand Refinery (PTY) Ltd Gold South
Africa
Metal
Production
3 15 business days
from invoice
date
1,758,881 28.3
3. Huadian Gold Co., Ltd. ( ዏ
ப΂ʮ̡)
Gold PRC Mining 2 N/A 467,515 7.5
4. Bank of Ghana Gold Ghana Bank 2 2 days upon
receipt of
delivery notice
289,700 4.7
5. Shandong Jinchuang
Gold&Silver Smelting
Co., Ltd. (ვз
ʮ̡)
Copper PRC Mining 3 N/A 248,281 4.0
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Rank Customer
Type of
Product(s)
Sold
Country/
Region
Nature of
Business
Y ear(s) of
Business
Relationship as
of the Latest
Practicable Date Credit terms Revenue
%o fo u r
Total
Revenue
(RMB’000)
For the year ended December 31, 2023
1. ABC Refinery (Australia)
Pty Ltd
Gold Australia Refinery 4 Up to 90%
prepayment
2,672,102 37.0
2. Rand Refinery (PTY) Ltd Gold South
Africa
Metal
Production
3 15 business days
from invoice
date
1,841,610 25.5
3. Trafigura Pte Ltd Copper Singapore Commodities
Production
6 3 days upon
delivery
382,512 5.3
4. Huadian Gold Co., Ltd. ( ዏ
ப΂ʮ̡)
Gold PRC Mining 2 N/A 365,980 5.1
5. Shandong Jinchuang
Gold&Silver Smelting
Co., Ltd. (ვз
ʮ̡)
Gold PRC Mining 3 N/A 303,364 4.2
For the year ended December 31, 2022
1. ABC Refinery Gold Australia Refinery 4 Up to 90%
prepayment
2,602,266 41.5
2. Rand Refinery Gold South
Africa
Metal
Production
3 15 business days
from invoice
date
1,745,894 27.9
3. Trafigura Pte Ltd Copper Singapore Commodities
Production
6 3 days upon
delivery
393,342 6.3
4. Shandong Zhaojin
Gold&Silver Refinery
Co., Ltd. (ვၚ
ʮ̡)
Gold PRC Mining 3 N/A 381,649 6.1
5. Y ongxing Qiangsheng Silver
Industry Co., Ltd. ( ͑ጳጤ
ப΂ʮ̡)
Gold PRC Mining 4 N/A 222,609 3.6
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Rank Customer
Type of
Product(s)
Sold
Country/
Region
Nature of
Business
Y ear(s) of
Business
Relationship as
of the Latest
Practicable Date Credit terms Revenue
%o fo u r
Total
Revenue
(RMB’000)
For the year ended December 31, 2021
1. ABC Refinery Gold Australia Refinery 4 Up to 90%
prepayment
2,126,600 56.2
2. Trafigura Pte Ltd Copper Singapore Commodities
Production
6 3 days upon
delivery
274,582 7.3
3. Shandong Zhaojin
Gold&Silver Refinery
Co., Ltd. (ვၚ
ʮ̡)
Gold PRC Mining 3 N/A 247,632 6.5
4. Chengdu Tianxinyang Gold
Industry Co., Ltd. ( ϓே̹
ப΂ʮ̡)
Gold PRC Mining 5 N/A 162,645 4.3
5. Huludao Zinc Industry Co.,
Ltd. (ࠢ
ʮ̡)
Zinc PRC Mining 7 N/A 134,711 3.6
To the best of our knowledge, during the Track Record Period and up to the Latest
Practicable Date, our customers were Independent Third Parties. As of the Latest Practicable
Date, none of our Directors, their associates or any of our shareholders (who or which to the
knowledge of the Directors owned more than 5% of our issued share capital) had any interest
in any of our five largest customers in each year/period of the Track record Period.
PROCUREMENT AND SUPPLIERS
We conduct our business in China, Laos and Ghana, where we face different social and
natural environment and have different business needs. We consider that procurement
management excellency is one of our key focuses. We have adopted headquarter-supported
global centralized procurement system to enhance our procurement management efficiency.
The Global Procurement System is primarily implemented through the Global Supply Chain
Center (the “ GSCC ”). Acting as a bridge between domestic suppliers and overseas mines, it
delivers products that are reasonably priced and of high quality to overseas mines via
international freight forwarding. Upon receiving the demand from overseas mines, the GSCC
begins to price inquiry. Based on the amount of the inquiry, it collects quotations from potential
suppliers in different tiers to help mines establish contracts with suitable suppliers and assists
with subsequent transportation and after-sales matters.
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In addition, the GSCC also serves as an information-sharing platform for overseas mines.
For similar or analogous demands, the GSCC offers information and previous experience
related to supplier sourcing, development and certification, price inquiries, and procurement
services. Other mines can use this as a reference to carry out their procurement activities,
thereby avoiding potential duplication of work.
The system helps our Company from three aspects, namely the centralization,
standardization and digitization, to enhance our procurement management efficiency:
Centralization – the purchase prices were set by entering into annual framework
agreements with the suppliers. By centralizing data on the use of supplies and raw materials
from our mines, we achieved economies of scale. In order to cut down on unnecessary
duplication and enhance procurement efficiency, the mines designate consolidated procurement
items, instead of contact by each mine separately, the GSCC handles the quotation and
procurement process directly.
Standardization – by making the procurement procedure and particular regulations
explicit, our mines may carry out procurement operations according to a unified standard,
which eliminates the needless work that due to ambiguous regulations.
Digitization – with the aid of sophisticated data tools, each mine’s procurement-related
data is updated in real time every two weeks, enabling the procurement team to make precise
procurement decisions.
As a supplement to our procurement methods, we also procure individually in each
country. In addition, to manage ESG risks in the supply chain, we have established a
mechanism to evaluate suppliers’ performance in various aspects such as fair competition,
occupational safety, human rights protection, and environmental protection. We will select
three to five qualified suppliers for further screening and regularly conduct on-site inspections
to learn more about their scale, production capacity, production technology, employee quality,
innovation, and management systems and specifications. We will cease cooperation with
suppliers whose ESG risks do not meet our requirements.
Our PRC Operations
In terms of our business development strategies, we focus on our gold mining business
through acquisitions, expansions and gradual divestment of non-core assets, thereby achieving
significant growth. This has allowed us to transform ourselves into a specialized gold
production company and we will continue to enhance our capabilities in this regard. As such,
all disclosure of our practice in the subsections titled “Our PRC Operations” here and below
mainly covers our gold production business in China.
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We have developed a dedicated procurement platform to manage our procurement
activities. This platform covers the whole procurement process, such as ascertaining
procurement needs, on-site visits to suppliers, obtaining fee quotes, arranging public bidding,
signing of agreements, order placement and fee payments. Through this platform, we undertake
centralized management in relation to our procurement in the PRC.
(a) Raw Materials
We procure a wide range of raw materials used in our mining operations, such as
explosive materials, diesel, sodium cyanide and cement, primarily from local suppliers in the
PRC.
The quality of our raw materials meets the relevant standards set by the industry and the
state. For certain hazardous and explosive materials, we only procure these from suppliers
approved by the competent authorities, and we require such suppliers to provide us with copies
of the special permits issued by the relevant governmental authorities. Our suppliers generally
are responsible for delivering raw materials to locations designated by us pursuant to the
relevant procurement agreements. We undertake inspection of the raw materials before we
accept delivery. We also require our suppliers to provide warranties on the raw materials with
varying terms depending on the specific type of raw materials.
(b) Machinery and Equipment
We procure various machinery and equipment for our production activities, including
mining and processing equipment which mainly comprises rock drilling machines, drilling
jumbos, scrappers, crushing circuits, grinding circuits, flotation circuits, pressure filters,
conveyers, and other ancillary equipment. Our equipment and machinery include both leading
international and domestic brands, which we purchase mainly from local suppliers.
We own the majority of the machinery and equipment used in our operations. The lifespan
of our machinery and equipment generally ranges from two years to 20 years with depreciation
calculated using the straight-line method. We have on-site personnel who undertake routine
checks and maintenance on our machinery and equipment. We also conduct regular equipment
inspections and upgrades.
Our Operations in Laos and Ghana
We procure various materials, such as diesel fuel, processing chemicals and reagents,
explosives, and related consumables, as well as machinery and equipment for our production
operations mainly from (i) different local suppliers in Laos and Ghana and/or (ii) the original
equipment manufacturers. We also procure various services, such as security services, civil
work services, engineering services and loading and hauling services, from various local
suppliers in Laos and Ghana. We usually source qualified suppliers through (i) public bidding
and tendering, or (ii) market research and request of fee quotes. We require candidates to
BUSINESS
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provide the relevant licenses and permits for reference. We may undertake further due
diligence, such as background checks and risk assessments, as and when necessary. The
selected suppliers are put on our approved supplier list, which is reviewed and updated on a
periodical basis.
Suppliers
We generally select suppliers of raw materials and machinery and equipment, through a
public bidding and tendering process. In selecting suppliers, we consider a wide range of
factors, such as the supplier’s qualifications, experience, pricing, service or product quality,
reputation and delivery time, and any past business relationship we may have.
To secure competitive prices, we may enter into long-term agreements with certain
suppliers for purchasing materials and/or services from time to time.
The salient terms of standard suppliers’ agreements are set out as below:
 Term. Our long-term agreements with suppliers typically last for one to two years.
 Pricing. For the general goods and equipment, prices are determined through
competitive bidding processes to ensure transparency and cost efficiency. For bulk
materials, such as steel and sulfuric acid, prices are determined via tender-based
procurement with annual framework agreements.
 Payment. Our suppliers usually grant us a credit term of 30 to 60 days from our
receipt of the invoice for payment settlement. Alternatively, payments may be made
in installments, combining advance payment with final payment upon acceptance.
For machinery or equipment, we typically retain a 10% quality guarantee deposit,
which is settled within 12 to 18 months, provided that no quality issues arise during
this period.
 Qualification. We require our suppliers to possess a business license and other
necessary permits. For certain types of supplies, we require our suppliers to possess
specialized certifications or qualifications for the materials or goods they provide.
 Quality control. Our agreements with suppliers typically include warranty and return
clauses to address any potential defects or non-conformities of the supplies.
 Transportation. Our suppliers are generally responsible for transporting and
delivering purchased materials or goods to our facilities.
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To secure competitive prices, we may enter into long-term agreements with certain
suppliers for the provision of materials and/or service from time to time. Our suppliers usually
grant us a credit term of around 30 days from our receipt of the invoice for payment settlement.
Our suppliers generally transport the purchased materials or supplies to our facilities.
We consider it important to maintain good and long-term business relationships with our
suppliers. We also employ a performance management program to evaluate our suppliers in
order to confirm that each supplier remains capable to provide products and/or services that
satisfy our production needs, as well as future development needs and future development
needs. We may set out key performance indicators in our agreements with suppliers. In
addition, we seek to diversify our supplier base to avoid disruptions in the provision of key
supplies. We believe that most of the supplies we procure can be readily obtained from a wide
range of suppliers at reasonable prices and we do not rely on any particular supplier. During
the Track Record Period, we did not encounter any material disruption to our business as a
result of shortage or delay in the supply of raw materials and machinery and equipment.
During the Track Record Period, all of our top five suppliers in the respective year/period
were service or commodity providers such as suppliers of electricity, fuel, and transportation.
For each year/period of the Track Record Period, purchases from our top five suppliers
amounted to RMB647.3 million, RMB855.2 million and RMB666.5 million and RMB633.9
million, respectively, accounting for 25.6%, 19.1%, 13.7% and 17.6% of our cost of sales for
the same periods, respectively. Purchases from our largest supplier for each year/period of the
Track Record Period amounted to RMB159.5 million, RMB210.6 million, RMB149.5 million
and RMB235.5 million, respectively, accounting for 6.3%, 4.7%, 3.1% and 6.5% of our cost
of sales for the same periods, respectively. The following table sets forth our top five suppliers
for each year/period during the Track Record Period:
Rank Supplier
Type of
products/
services
provided
Country/
Region
Nature of
Business
Y ear(s) of
business
relationship as of
the Latest
Practicable Date Credit terms
Purchase
amount
%o fo u r
total cost
of sales
(RMB’000)
For the nine months ended September 30, 2024
1. Setters Investment Co., Ltd Project
drilling
Ghana Underground
drilling
1 30 days upon
receipt of
invoice
235,507 6.5
2. Electricite du Laos Electricity Laos Power
Supply
6 14 days after the
invoice
134,959 3.7
3. GENSER ENERGY
GHANA LTD
Electricity Ghana Power
Supply
5 30 days after the
invoice
98,680 2.7
4. Ghana Oil Co., Ltd Fuel and
lubricant
Ghana Oil 3 30 days upon
receipt of
approved
invoice
85,675 2.4
5. Lao State Fuel Company Fuel Laos Fuel 5 30 days after the
invoice
79,125 2.2
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Rank Supplier
Type of
products/
services
provided
Country/
Region
Nature of
Business
Y ear(s) of
business
relationship as of
the Latest
Practicable Date Credit terms
Purchase
amount
%o fo u r
total cost
of sales
(RMB’000)
For the year ended December 31, 2023
1. Electricite du Laos Electricity Laos Power
Supply
6 14 days after the
invoice
149,506 3.1
2. Savan Transport and
Logistics
Transport
and
logistics
services
Laos Transportation 6 14 days after the
invoice
147,873 3.0
3. Lao State Fuel Company Fuel Laos Fuel 5 30 days after the
invoice
130,497 2.7
4. Petrovietnam Oil Lao
Petroleum
Fuel Laos Oil 5 30 days after the
invoice
129,820 2.7
5. Y ellow Power Ghana
Limited
Services Ghana Geology 2 30 days after the
invoice
108,839 2.2
For the year ended December 31, 2022
1. Savan Transport and
Logistics
Transport
and
logistics
services
Laos Transportation 6 14 days after the
invoice
210,623 4.7
2. Lao State Fuel Company Fuel Laos Fuel 5 30 days after the
invoice
182,465 4.1
3. Petrovietnam Oil Lao
Petroleum
Fuel Laos Oil 5 30 days after the
invoice
167,377 3.7
4. Saksri Industry Co., Ltd Sulphuric
acid
(H
2SO4)
Thailand Chemical
Production
5 30 days after the
invoice
161,982 3.6
5. Witcorp Products Ltd Material Thailand Chemical
Production
5 30 days after the
invoice
132,754 3.0
For the year ended December 31, 2021
1. Lao State Fuel Company Fuel Laos Fuel 5 30 days after the
invoice
159,453 6.3
2. Khounxay Phatthana Const Services Laos Construction 6 14 days after the
invoice
145,014 5.7
3. Savan Transport and
Logistics
Transport
and
logistics
services
Laos Transportation 6 30 days after the
invoice
121,193 4.8
4. Petrovietnam Oil Lao
Petroleum
Fuel Laos Oil 5 30 days after the
invoice
120,114 4.8
5. Vilabouly Development
Construction
Services Laos Construction 6 30 days after the
invoice
101,530 4.0
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The table below sets forth the price range of the top five raw materials by volume of usage
of our Group during the Track Record Period:
No. Raw Material Price Range Unit
USD/Unit
1 /H1118/H1118/H1118Diesel 0.79-1.47 Litre
2 /H1118/H1118/H1118Sulphuric Acid 40.00-206.00 Ton
3 /H1118/H1118/H1118Diesel 0.95-1.69 Litre
4 /H1118/H1118/H1118Lime (Hydrated) 71.36-165.10 Bag/1.3 ton
5 /H1118/H1118/H1118Sodium Cyanide 1,829.96-2,775.30 Box/1,000kg
The table below sets forth the five most expensive machinery/equipment procured by our
Group during the Track Record Period:
No.
Machinery and
Equipment Price/Price Range Application
(USD/Unit)
1 /H1118/H1118/H1118LH621i LOADER 1.5-1.8 million An underground loader designed for
ore loading and hauling in mining
operations.
2 /H1118/H1118/H1118SANDVIK DL432i
TH LONG
HOLE DRILL
1.7 million An advanced underground long hole
drill for drilling operations in
underground mining and tunneling
projects.
3 /H1118/H1118/H1118Sandvik DD421
Development
Drill
1.3 million A dual-boom electro-hydraulic jumbo
drill for underground mine
development and small-scale
tunneling operations.
4 /H1118/H1118/H1118ALC Regrinding
Mill, Model
ALC-3900L
1.1 million A regrinding mill primarily used for
gold ore and tailings regrinding
processes.
5 /H1118/H1118/H1118VCASFT210242-2
– V olvo
Articulated
Hauler A45G
0.5 million An articulated hauler for quarrying,
mining, tunneling, and material
handling in harsh terrains and
demanding environments.
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To mitigate impact of raw materials price fluctuations, we have adopted the following
measures:
(a) entering into framework agreements with key suppliers, securing fixed pricing terms
without volume commitments, to lock in costs against market volatility, while
maintaining flexibility for spot purchases;
(b) determining purchase prices based on the publicly tracked market indices and
pre-agreed formulas to prevent price manipulation by suppliers;
(c) developing alternative low-cost suppliers across multiple regions through our
Global Procurement System; and
(d) monitoring real-time price trends of bulk materials, such as steel, copper and
chemicals. In the event of abnormal fluctuations, our operational units will be
notified and we will coordinate feasible mitigation measures.
During the Track Record Period and as of the Latest Practicable Date, we did not
experience any material impact to our operation or financial condition due to any significant
fluctuation in prices set by our suppliers or any material breach of contract on the part of our
suppliers. During the Track Record Period and as of the Latest Practicable Date, none of our
Directors, their associates or any of our shareholders (who or which to the knowledge of the
Directors owned more than 5% of our issued share capital) had any interest in any of our five
largest suppliers in each year/period of the Track record Period and the top five suppliers are
all independent third parties.
CONTRACTORS
Our PRC Operations
In line with industry practice, we outsource a portion of our exploration and shaft
construction/engineering work in the PRC to qualified contractors. We enter into contracts with
contractors of different categories, covering a certain number of years or the duration of
various projects. After confirming that the services/products provided by the contractors meet
the acceptance standards stipulated in the relevant contracts, we will make payments according
to the contract schedule or the agreed payment terms. Under these contracts, we are usually
responsible for providing the contractors with relevant maps and plans to assist them in
accessing our mining areas to carry out their work. Contractors are liable for the safety of their
construction personnel and the quality of their construction work, and in certain projects, they
are bound by confidentiality obligations. In the event of safety production or quality issues,
these contracts can be terminated upon the mutual consent. As we expand our production scale,
we believe that these outsourcing arrangements will enable us to meet our operational needs,
reduce our operational costs, and lower operating risks. We believe that the services provided
by our contractors are common in the market, and it would not be difficult for us to find
alternative contractors to provide similar services on terms comparable with those between our
existing contractors and us.
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Given that the majority of our contractors provide services relating to exploration,
excavation and mining, our ESG risk control management for contractors places a greater
emphasis on production safety. We carefully examine the production safety permits and other
related construction qualifications of contractors. We also enter into production safety
management agreements with relevant contractors to clarify their safety production
management obligations and allocate risks. In order to quickly identify and address potential
ESG risks, each mine simultaneously manages contractors in accordance with our ESG
standards. This is done through inspections by team leaders, reporting by special operation
personnel, and regular investigations on production safety.
The table below sets forth the breakdown of the category, number and fees incurred
during the Track Record Period:
As of December 31, As of September 30,
2021 2022 2023 2024
Number
Fee
incurred Number
Fee
incurred Number
Fee
incurred Number Fee incurred
(RMB’000) (RMB’000) (RMB’000) (RMB’000)
Exploration /H1118/H1118/H11186 19,448.7 8 27,966.5 11 23,045.0 7 13,844.8
Construction /H1118/H11188 111,076.3 13 75,135.6 27 68,381.7 21 87,539.6
Excavation and
Mining /H1118/H1118/H1118/H11186 141,690.3 7 151,798.2 3 61,019.0 0 0
Other /H1118/H1118/H1118/H1118/H1118/H11183 23,292.9 4 10,163.7 4 1,483.7 1 3,220.6
Total /H1118/H1118/H1118/H1118/H1118/H111823 295,508.2 32 265,064.0 45 153,929.4 29 104,605.0
Due to the intensive competition in the relevant contracting service market, we do not
believe that it would be difficult for us to find alternative contractors to provide similar
services on terms comparable to those with our existing contractors. During the Track Record
Period and up to the Latest Practicable Date, we did not have any material disputes with our
contractors that would have material adverse impact on our operations or cause our
contractors’ work in the PRC to be suspended. For relevant risks, see “Risk Factors — Risks
Relating to Our Business and Industry — We may suffer material adverse consequences as a
result of our reliance on contractors to conduct a portion of our business activities.”
To the best of our knowledge, during the Track Record Period and up to the Latest
Practicable Date, our contractors were Independent Third Parties. As of the Latest Practicable
Date, none of our Directors, their associates or any of our shareholders (who or which to the
knowledge of the Directors owned more than 5% of our issued share capital) had any interest
in any of our contractors.
We select contractors mainly through public bidding or by invitations to tender. Before
engaging a contractor, we will assess their qualification, competence and experience. In
particular, we require candidates to provide copies of their qualifications, licenses, certificates
and permits for review and verification. We then form an evaluation committee and supervision
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committee and follow the prescribed selection procedure to shortlist candidates for business
negotiations, after which we will make the final decision. During the Track Record Period, all
of our contractors were independent third parties.
We require our contractors to comply with all applicable laws and regulations in respect
of safety and environmental protection. We also require our contractors to abide by our safety
management system and our internal control requirements. The relevant departments in our
Company undertake regular check of our contractors to confirm that they are operating in
accordance with the technical specifications of our project and industry standards. We also
engage third-party personnel to supervise our contractors’ work, to ensure objective
management over project status and quality. If the products or services provided by our
contractors fail to meet the standards or requirements as specified in the relevant contracts, we
would promptly notify the relevant contractors to adjust or rectify. In the event we discover
significant non-compliance or other issues in the implementation of our project, we are entitled
to suspend such contractor’s work and require them to take correctional actions. In addition,
we require our contractors to purchase insurance for their employees and properties.
(a) Exploration
As of September 30, 2024, we had seven third-party contractors engaged in exploration
activities. We require contractors to hold the requisite qualifications for geological exploration.
We generally enter into contracting agreements for a term of one year with such contractors.
(b) Construction
As of September 30, 2024, we had 21 third-party contractors for construction. These
contractors are construction work professionals holding the requisite qualifications and
licenses and majority engaged in our shaft construction projects, which includes mine
construction, tunneling, hoisting and transportation, and for shaft engineering this includes
pitshaft equipment installation and removal and derrick installation. We generally enter into
contracting agreements based on the total project duration.
(c) Other Services
As of September 30, 2024, we had one third-party contractor for crushing services.
Our Operations in Laos
As of September 30, 2024, we engaged (i) 25 third-party contractors to undertake various
construction work, including permanent river alignment project, (ii) 60 third-party contractors
for mining and processing work in our projects in Laos, and (iii) 27 third-party contractors for
other services. From time to time, we may engage other third-party contractors to support our
mining activities, such as construction or improvement of tailing dams and roads in mining
sites. During the Track Record Period and up to the Latest Practicable Date, we did not have
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any material disputes with our contractors that would have material adverse impact on our
operation or suspended any contractors’ work in Laos. The table below sets forth the
breakdown of the category, number and fees incurred during the Track Record Period:
As of December 31, As of September 30,
2021 2022 2023 2024
Number
Fee
incurred Number
Fee
incurred Number
Fee
incurred Number
Fee
incurred
(USD’000) (USD’000) (USD’000) (USD’000)
Exploration /H1118/H1118/H11185 3,723.9 6 3,958.5 4 1,962.9 7 982.2
Construction /H1118/H1118 32 – 29 – 25 – 25 10,062.3
Mining and
Processing /H1118/H1118 48 59,987.1 60 33,741.7 60 27,837.2 60 27,151.7
Other /H1118/H1118/H1118/H1118/H1118/H111831 5,011.7 33 4,690.5 28 3,485.5 27 2,619.1
Total /H1118/H1118/H1118/H1118/H1118/H1118116 68,722.7 128 42,390.7 117 33,285.6 119 40,815.3
Our Operations in Ghana
As of September 30, 2024, we engaged five third-party contractors to provide excavation,
mining, exploration, processing, construction and drilling services to our operations in Ghana.
These contractors hold drilling and exploration service operating permits from the Minerals
Commission of Ghana. We require our contractors in Ghana to strictly comply with all
applicable laws and regulations in respect of safety and environmental protection. Furthermore,
we also hold them to specific technology and quality standards as well as detailed work
schedules. We evaluate the progress of exploration on frequent basis and monitor the service
providers to ensure compliance. During the Track Record Period and up to the Latest
Practicable Date, we did not have any material disputes with our contractors that would have
material adverse impact on our operation or suspended any contractors’ work in Ghana. The
table below sets forth the breakdown of the category, number and fees incurred during the
Track Record Period:
As of December 31, As of September 30,
2022 2023 2024
Number
Fee
incurred Number
Fee
incurred Number
Fee
incurred
(USD’000) (USD’000) (USD’000)
Exploration /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184 – 2 – 1 1,142.0
Construction /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181– 1– 0–
Excavation and
Mining /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182 2,567.6 3 13,317.1 2 20,362.7
Other /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180 1,067.6 1 1,131.3 1 –
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187 3,635.2 7 14,448.4 5 21,504.7
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GOLD LEASING, HEDGING AND STREAMING
Gold Leasing
We obtain short-term financing by gold leasing arrangements, through which we mainly
lease gold from the various PRC commercial banks which is sold in the market through the
system of the Shanghai Gold Exchange in order to supplement our working capital. Upon
maturity of the lease, we return such leased gold back to the relevant commercial banks with
payment of leasing fees. Meanwhile, we usually enter into forward purchase contracts in the
form of futures standard agreements at the Shanghai Futures Exchange, pursuant to which we
agree to purchase the same amount of gold, at the same price and on the maturity date of the
lease in order to repay the leased gold. Through this framework, our gold leasing arrangements
are generally not subject to material risks caused by fluctuation of gold market prices. The term
of our gold leasing arrangement is generally within one year. During the Track Record Period,
the interest rates of our gold leasing arrangement ranged from 1.5% to 2.7% and were lower
than that of bank borrowings or other financing means.
Hedging
We have different measures to hedge against the risk of fluctuations in gold price. To
mitigate the risks of future increases in the prices of the gold we intend to lease, we engage
in hedging through forward transactions or by purchasing futures products in the futures
market for the leased gold. As a gold production enterprise, we take risk management strategy
to prevent the risk of gold price declines by selling our gold products in major futures markets,
such as the Shanghai Gold Exchange or the COMEX gold exchange in the U.S., to lock in
prices. The volume of such transactions each year depends on the trend of gold price
fluctuation for that year, but the total volume will not exceed 10% of the annual gold
production according to our internal policy.
We have entered into, and expect to continue to enter into, futures hedging transactions
to forward sell gold and other metals produced by our mines in order to secure desired prices
and hedge against volatility in market prices. Our hedging transactions are mainly conducted
through gold futures contracts on the Shanghai Futures Exchange and other international
exchanges. Pursuant to standard gold futures contracts, we will provide an agreed amount of
gold on a specific date at an agreed sale price. Based on the outlook of the gold prices and our
expected gold production amount, we negotiate the price, settlement date and other contract
terms accordingly.
Pursuant to our policy, a hedging management group composed of certain members of our
senior management, including the Chairman, the CEO, the CFO and other colleagues from
financial, trading, accounting and risk management departments with professional financial
expertise, is responsible for managing our hedging activities. For our hedging transactions, we
may not hold positions that in aggregate exceed 10% of our annual gold production volume,
and the size of each hedging position should be in line with our production volume and capital
strength at the time pursuant to our Board authorization. Under the hedging management
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group, we have a designated hedging trading group responsible for planning and proposing
hedging transactions based on our production plan as well as market analysis, including
analysis of the expected gold prices. Such proposals are submitted to our the hedging
management group for review and approval, after which we execute the transactions. We record
our hedging transactions in our accounts and keep documentation relating to these transactions.
In the event of any significant fluctuations in gold prices, our hedging trading group will
promptly provide our senior management with an analysis of the risk of losses and a proposal
of the measures that should be taken. We also have under our hedging management group, a
hedging settlement group mainly responsible for fund settlement, and a hedging risk control
group mainly responsible for risk assessment and monitoring during such hedging transactions.
We have applied hedge accounting under IFRS 9 for our gold leasing transactions and futures
hedging transactions.
Metal Streaming
Golden Star Resources, through a wholly owned subsidiary Caystar Finance Co.
(“Caystar Finance ”), entered into a Gold Purchase and Sale Agreement with RGLD GOLD
AG (“ RGLD ”), dated May 6, 2015, which was subsequently amended and restated on June 29,
2018 and September 30, 2020 (the “ Streaming Agreement” ). RGLD is a royalty and streaming
company that engages in the acquisition and management of precious metal streams, royalties,
and similar production-based interests. It is publicly traded on the Nasdaq Global Select
Market under the symbol “RGLD”. Metal streaming as a financing option offers several
benefits for mining companies like us compared to traditional debt or equity deals. Compared
to debt, streaming deals typically have longer payment terms, no fixed cash obligations
(reducing risk during price downturns), fewer restrictions on cash use, minimal or no debt
covenants, and shared production and operational risks. Compared to equity, streaming deals
are less dilutive since they focus on a single asset, are more favorable when share prices are
low, avoid ownership or management changes, and usually do not involve extra costs like
brokerage fees. Overall, streaming provides a flexible, lower-risk financing alternative for
mining companies like us.
Pursuant to the Streaming Agreement, RGLD paid an advance payment in the amount of
US$145,000,000 in exchange for a gold stream of the Wassa Mine, entitling RGLD to purchase
a stream of our gold production at a reduced gold price. Specifically, RGLD is entitled to
purchase (1) 10.5% of the gold production of the Wassa Mine at a cash purchase price of 20%
of the spot price until 240,000 ounces (“ Delivery Threshold ”) have been delivered; and (2)
thereafter, 5.5% of gold production (“ Tail Stream Percentage ”) at a cash purchase price of
30% of spot price (the “ Streaming Transaction ”).
The term of the Streaming Transaction continues until the date that is 40 years after 6 May
2015, and may be extended by either RGLD or us for successive 10 year periods, subject to
certain conditions. According to Frost & Sullivan, the discount rate and duration of the
agreement are in line with industry norms.
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We are subject to certain covenants in, and RGLD enjoys certain rights under, the
Streaming Agreement, principally:
 Information rights . We shall deliver to RGLD, among other information, reports
related to Wassa Mine’s mineral reserves and resources, forecast of annual
production and project economics, life of mine plan and updates thereof, feasibility
studies and engineering and metallurgical and related data and evaluations, notice of
material events, financing agreements, etc. RGLD is also entitled to inspect the
Wassa Mine, subject to certain conditions.
 Ranking . Our obligation to sell and deliver gold production under the Streaming
Agreement will rank as an operating expense in any cash waterfall agreed with any
provider of financing. All proceeds received by us for any sale of gold will be used
in satisfaction of its obligations to RGLD prior to any payment of such proceeds to
any other person.
 Negative pledge . We will not grant any encumbrance on the Wassa Mine other than
encumbrances in connection with senior financing, in which case, RGLD will enter
into a subordination agreement with the relevant senior financing parties.
 Leverage Ratio . GSWL’s leverage ratio shall be less than or equal to 3.50:1.
 Right of First Refusal . RGLD enjoys a right of first refusal with respect to any
additional stream of gold production or royalty arrangement proposed to be sold by
GSWL.
 Election to increase or decrease the Tail Stream Percentage . at any time after the
Delivery Threshold, we have a one time election to offer to reduce the Tail Stream
Percentage by a specified amount (the “ Specified Percentage ”) or, at RGLD’s
option following our’s exercise of the Tail Stream Election to increase the Tail
Stream Percentage by the Specified Percentage, in each case for the same cash price.
 Other negative covenants . We are also subject to certain negative covenants with
respect to sale, disposal and encumbrances of GSWL’s assets and our operations of
the Wassa Mine.
During Track Record Period, our revenue generated under the Gold Purchase and
Streaming Agreement (as part of the sale of products of our gold production business in Ghana)
was nil, RMB47.2 million, RMB52.3 million and RMB44.7 million, respectively, representing
nil, 0.8%, 0.7% and 0.7% of our total revenue for the same periods, respectively.
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UTILITIES
Electricity
(a) Our PRC Operations
We mainly obtain electricity from the state electrical power grid. We generally enter into
agreements with the state electrical power grid authority on an annual basis. The price of
electricity is determined pursuant to the relevant electricity market rate by following related
guidance thereon published by the governmental authorities in the PRC. We may enjoy a
discounted price for electricity under clean energy policies promulgated in the PRC. During the
Track Record Period and up to the Latest Practicable Date, we did not experience any
significant interruptions in our operations in the PRC as result of power shortage or outages.
(b) Our Operations in Laos
We obtain electricity from the state electricity company of Laos. The price of the
electricity is mainly determined in accordance with the purchase agreement we signed and
subject to the local pricing policies published by Laotian Government. During the Track
Record Period and up to the Latest Practicable Date, we did not experience any significant
interruption in our operations as result of power shortage.
(c) Our Operations in Ghana
We mainly obtain electricity from a local gas-fired power plant. We also engaged the local
state electricity power grid as back-up power supplier. The price of electricity is primarily
determined through arm’s length negotiations by reference to the relevant electricity market
rate. In addition, we have diesel generators in place for power supply in case of emergency.
During the Track Record Period and up to the Latest Practicable Date, we did not experience
any significant interruptions in our operations in Ghana as a result of power shortage or
outages.
Water
(a) Our PRC Operations
The majority of our mines in the PRC are underground mines and we mainly use
underground water, and to a lesser extent surface water, for industrial use. Water for domestic
use is sourced from both local water companies underground water. During the Track Record
Period and up to the Latest Practicable Date, we did not experience any significant interruption
in our operation as result of water shortage.
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(b) Our Operations in Laos
The water supply for both industrial use and domestic use in Laos are secured from local
water companies. During the Track Record Period and up to the Latest Practicable Date, we did
not experience any significant interruption in our operations in Laos as result of water shortage.
(c) Our Operations in Ghana
The water supply for both industrial and domestic use in Ghana is mainly secured from
underground water. During the Track Record Period and up to the Latest Practicable Date, we
did not experience any significant interruption in our operations in Ghana as result of water
shortage.
For details of the relevant risks, see “Risk Factors — Risks Relating to Our Business and
Industry — We may not be able to maintain adequate, uninterrupted, timely and specification-
compliant supplies of utilities, materials, equipment and service at commercially acceptable
prices, or at all” and “Risk Factors — Risks Relating to Our Business and Industry — Power
outages and usage constraints may force us to halt or curtail operations, or subject us to
penalties.”
LOGISTICS
Our PRC Operations
We engage professional third-party logistics service providers for transporting mined ore
to the processing facilities, our products to the relevant customers as well as various materials
we procured from suppliers from time to time. We use positioning systems to track the specific
location of fleet vehicles and video-links allow for real-time monitoring of the transport
security personnel. Generally, such logistics service providers are responsible for maintaining
insurance associated with the transportation and bear the relevant risks. During the Track
Record Period and up to the Latest Practicable Date, we did not experience any material
shortage of transportation capacity.
Our Operations in Laos and Ghana
For our operations in Laos and Ghana, we engage professional third-party logistics
service providers for the cross-border transportation of our products to customers by air and/or
land transport and, to a lesser extent, transportation of certain materials we procured from
suppliers. Generally, such logistics service providers are responsible for maintaining insurance
associated with the transportation and bear the relevant risks. During the Track Record Period
and up to the Latest Practicable Date, we did not experience any material shortage of
transportation capacity.
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INVENTORY
Our PRC Operations
Our inventories mainly include raw materials, work-in-progress, inventory commodities,
turnover materials, consignment goods and inventory consumables. We have established
inventory management policies to manage inventory levels pursuant to our production plan and
the prevailing market conditions.
Following our standard inspection procedures, our inventory personnel examine each
shipment pursuant to our agreements or purchase orders to ensure conformity of the shipment
with the relevant specifications, quality and quantity requirements. Where the documents are
incomplete, the relevant supplies are stored pending acceptance check at later stage. If the
specifications, quality or quantity of the supplies do not match the agreement or purchase
orders, we will reject the supplies and liaise with suppliers to follow up. All movements of our
inventories are subject to inventory controls at the warehouse, are recorded in our inventory
management system and are subject to review and confirmation by our finance department.
We undertake routine inventory reviews and arrange inventory checks on a more detailed
and in-depth basis for at least once a year. All personnel entering our inventory warehouses are
subject to strict security check, and we have real-time video camera, alarm system, and security
guards in place to prevent security issues. Furthermore, we have insurance coverage on our
inventories.
Raw materials such as spare parts and components are subject to risk of obsolescence. The
obsolescence of raw materials is primarily due to the obsolescence of some spare parts and
components for production machinery and maintenance equipment of LXML, which were
purchased for the open-pit mining for LXML. They have long turnover days as they will only
be used to replace the original parts and components when the original parts and components
are damaged. Since the commencement of the transferring open-pit mining to underground
mining in 2022, these spare parts and components for the production machinery and
maintenance equipment have been held in storage. In contrast, consumables in other raw
materials, such as explosive materials and diesel, generally have shorter turnover days. To
effectively monitor the risk of inventory obsolescence, we implement a comprehensive set of
measures. First, we conduct regular inventory reviews and aging analyses to identify
slow-moving or obsolete items. We actively manage our inventory turnover days to more
effectively plan our production and monitor our inventory level. Second, we maintain close
collaboration with our sales, procurement, and production teams to align inventory levels with
demand forecasts and market trends. Third, we utilize inventory management software to track
stock levels, usage patterns, and shelf life in real time. Finally, we establish clear policies for
writing off or disposing of obsolete inventory to minimize financial impact.
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Our Operations in Laos and Ghana
Similar to our operations in the PRC, our inventories in Laos and Ghana mainly include
raw materials, work-in-progress, turnover materials and inventory consumables. Our inventory
personnel in Laos and Ghana are generally responsible for implementation of our inventory
policies. Our inventory personnel are separated into: (i) a warehousing team, which is
responsible for physical management, such as receiving, storing and issuing supplies; and
(ii) an inventory team, which is responsible for managing our inventory system and data, such
as the actual levels for individual items. Our inventory levels are managed pursuant to our
consumption record and lead time for supplies. All inventory information is recorded in our
inventory system and categorized for ease of data analysis. We set the minimum and maximum
inventory levels in our inventory system, which assists us arrange timely procurement. We
undertake routine inventory review every three months for small-sized items and annually for
large-sized items. We generally increase our inventory of raw materials prior to certain
predicable events, such as monsoon seasons.
For details of relevant risks, see “Risk Factors — Risks Relating to Our Business and
Industry — We are exposed to the risk of obsolescence and impairment of our inventory.”
QUALITY CONTROL
Quality control is crucial to our operations. We have a dedicated product quality
department, which comprises laboratories, a measurement team and a sampling team to ensure
quality control. We have also established a stringent quality control system to ensure the
quality of our products throughout our different production stages. If a quality issue is raised
by a customer, we will undertake comprehensive investigations and consult with the relevant
customers, and, to the extent needed, may submit any dispute to qualified third-party
organization for arbitration. During the Track Record Period, we did not receive any material
complaints due to quality issues of our products.
With respect to mining and processing, we have implemented a comprehensive quality
control system to monitor the quality at each key stage of our mining and processing
procedures. We have established specific guidelines for procedures to manage the quality of the
ores mined. Ores mined from our mines are sample-tested at our laboratories on a regular basis
to monitor the grade of the ore.
We provide quality and technical specifications to our suppliers and generally require
suppliers to provide warranties for the supplies they provide. We inspect shipments of raw
materials before accepting delivery. We require our third-party contractors to meet our
qualification requirements and conduct their operations in accordance with our internal
standards, industry standards and relevant laws and regulations. We regularly inspect the work
of our suppliers, and we conduct full quality inspections upon project completion.
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COMPETITION
Industry concentration has continued to increase in light of the continuous mergers and
integration of gold enterprises. The top ten global gold producers in 2023 accounted for around
25.6% of the global gold mining production, according to Frost & Sullivan. Most of the top
gold producers are headquartered in the United States, Australia, Canada, South Africa, Russia,
Uzbekistan and China. We compete with international players in acquiring attractive gold
mining properties.
The gold mining industry in China is relatively fragmented with the market dominated by
small- and medium-sized gold mining companies accounting for majority of the market share.
In 2023, (i) we ranked fifth among gold producers in China in terms of gold Resources, with
gold Resources of 13.6 million oz; and (ii) we ranked fifth among gold producers in China in
terms of gold production, with production of 461.5 koz of gold, according to Frost & Sullivan.
Moreover, we also had the highest number of overseas assets as of December 31, 2023 and
overseas revenue contribution in 2023 compared with any major gold producers in China,
according to Frost & Sullivan.
Our major competitors are large international and PRC mining companies. We primarily
compete based on our ability to obtain gold Reserves and Resources, which is dependent on our
financial conditions, technical ability, equipment and machinery and human capital. The
mining industry is a capital-intensive industry that requires significant technical, exploration
and management experience. Moreover, mining is subject to extensive regulations and requires
a number of licenses and permits to operate. These factors constitute significant barriers to
enter the gold mining industry. For further details of the competition landscape and our market
position, see “Industry Overview.”
RESEARCH AND DEVELOPMENT
We are committed to continuous research and development, which we believe will ensure
our competitiveness in the industry and enable us to sustainably grow our business in the
future. As of September 30, 2024, our dedicated R&D team comprised 595 employees. Our
R&D team focuses on exploration to improving our mining and processing technologies,
including, in particular increasing our processing recovery rate. Our research achievements are
reflected in our academic publications, such as (i) “The Research and Setting of Energy
Consumption Limitation of Product Unit for Gold Mining, Processing and Refining” (ක
֛which was awarded the 2016 China
Gold Association Technology First Prize (2016ኪҦஔᆤɓഃᆤ), and (ii)
The Research and Application of Key Technologies of Decyanidation Treatment of Cyanide
Tailings (ӺၾᏐ͜) co-authored by Jilong Mining and
Changchun Gold Research Institute (Ӻ৫), which was awarded the “2018 China
Gold Associate Technology Second Prize” (2018ኪҦஔᆤɚഃᆤ).
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Our continuous efforts in research and development have also paid off in terms of the
various intellectual property rights, including patents and copyrights, we have obtained. As of
the Latest Practicable Date, we had 27 registered patents in the PRC. For further details, please
refer to the paragraph headed “— Intellectual Property Rights” below. In addition, our
subsidiaries Wulong Mining and Jilong Mining have been recognized as high and new
technology enterprises. Therefore, each of these enjoys a preferential enterprise income tax rate
of only 15%, as opposed to 25% for general enterprises in China. For details of the relevant
risks, see “Risk Factors — Risks Relating to Our Business and Industry — We received
government grants and enjoyed preferential tax treatment during the Track Record Period, and
any significant reduction in such grants or tax treatment offered to us may materially and
adversely affect our financial condition and results of operations.” In 2021, 2022 and 2023 and
the nine months ended September 30, 2024, our research and development expenses amounted
to RMB24.8 million, RMB27.7 million, RMB51.8 million and RMB47.9 million, respectively.
INTELLECTUAL PROPERTY
Intellectual property rights play an important role in our business operations. We conduct
our business under the trade names of “ږand “Chifeng Gold.” As of the Latest
Practicable Date, the intellectual property rights owned by us included: (i) 9 trademarks
registered in China; (ii) 27 patents in China; (iii) seven domain names in China; (iv) eight
software copyrights in China; (v) one copyright of works in China; (vi) two trademarks
registered in Laos; and (vii) two trademarks in Hong Kong. See “Appendix VII — Statutory
and General Information — Further Information about Our Business — Intellectual Property
Rights” for details of our material intellectual property rights.
To protect our intellectual property rights, we monitor whether there is any infringement
of our brand by conducting internet searches, including searches on the website of the National
Intellectual Property Administration of the PRC. During the Track Record Period and up to the
Latest Practicable Date, we were not involved in any material dispute or litigation relating to
infringement of trademarks and patents nor, to the best of our knowledge, did we infringe any
trademarks and patents belonging to other parties.
EMPLOYEES
We believe that our employees are critical to our success. Our human resources
department is responsible for recruiting, managing and training our employees. As of
September 30, 2024, we had 6,447 full-time employees in total, among which 2,240 employees
were in Laos and 892 employees were in Ghana.
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The following table sets forth the number of our employees by function as of the dates
indicated:
As of December 31, As of
September 30,
2024Function 2021 2022 2023
Production /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,071 3,689 3,515 4,996
Sales /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118377 8
Technology /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118777 632 887 445
Finance /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111844 59 57 60
Administration /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118820 750 991 938
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,715 5,137 5,457 6,447
The tables below illustrates the diversity and the composition of our employees:
2021 2022 2023
Total number of employees /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,715 5,137 5,457
Number of employees
by nationality /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
China – – 2,288
Laos – – 2,218
Ghana – – 807
Australia – – 29
Philippines – – 20
Papua New
Guinea
–– 1 3
Canada – – 11
Others – – 38
Number of employees
by gender /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Male – – 4,544
Female – – 913
Number of employees
by function /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Production 3,071 3,689 3,515
Technical 777 632 887
Sales 3 7 7
Finance 44 59 57
Administration 820 750 991
Note: We began publishing ESG report which provides the number of employees by nationality and gender
from 2023.
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We are required by PRC social insurance and housing provident fund laws and regulations
to make contributions to mandatory social insurance and housing provident funds for our
employees. During the Track Record Period, we did not make adequate contributions to the
social insurance and housing provident funds with respect to certain of our employees as
required by the relevant PRC laws and regulations. See “Risk Factors — Risks Relating to Our
Business — Implementation and enforcement of the labor laws and regulations in China may
adversely affect our business and results of operations. Failure to fully comply with PRC
labor-related laws may expose us to potential liabilities and penalties.”
We have maintained a good relationship and expect to maintain an amicable relationship
in the future with our employees. During the Track Record Period and up to the Latest
Practicable Date, there were no material strikes which had an adverse impact on our operation
and no material disputes between our Group and our employees.
Our PRC Operations
We view our employees as critical to our success, and we are committed to recruiting,
training and retaining skilled and experienced employees throughout our operations. We intend
to achieve this by offering competitive remuneration packages, which is above the market
average, as well as focusing on training and career development. Our remuneration packages,
including salary, bonus, commercial insurance and other benefits, are designed to reward our
employees based on their work performance as measured against specified work objectives. We
undertake yearly research on prevailing market remuneration conditions and adjust our
remuneration packages accordingly to ensure that our offer remains attractive compared with
our competitors. In addition, we provide induction training and a wide range of on-job trainings
to our employees on regular basis to enhance their professional knowledge, improve their
working skills and strengthen teamwork within our Company.
In line with customary industry practice in China, our employees are represented by labor
unions. We engage external legal counsel to provide professional legal support in relations to
various labor issues involving our employees. In addition, our human resource staff also attend
regular trainings on labor law and other related laws and regulations held by the relevant
governmental authorities. During the Track Record Period and up to the Latest Practicable
Date, we did not experience any strikes, work stoppages or significant labor disputes, nor did
we experience any significant difficulties in recruiting or retaining qualified personnel. Our
PRC Legal Advisor is of the view that, during the Track Record Period and up to the Latest
Practicable Date, we had complied with all applicable labor laws and regulations in the PRC
in all material respects. We believe that we have also maintained a stable and motivated
workforce and high level of employee loyalty.
We dedicate significant resources to employee recruitment and promotion. We recruit
employees through internal channels, such as function hiring and internal referrals by our
employees, and external channels such as online platforms, job fairs and head-hunters. We
place significant importance on internal promotion as a means to offer long-term career paths
and performance incentives for our employees. In particular, we formulate the talent
cultivation plans for mid-level and higher management employees. Leveraging our strong
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connections with various leading colleges, we have also fostered our talent development
system by conducting mentorship training programs for college students from various leading
universities in China. We believe such arrangements have enabled us to secure a stable pipeline
of high-quality employees which strongly support our continued business development and
success.
Our Operations in Laos and Ghana
We have established comprehensive human resources systems to manage recruitment,
employee development, salary and compensation, among other things. We design our
remuneration packages by reference to the local mining industry benchmark and are
competitive compared with our competitors. We also make contributions to mandatory social
security funds for our employees as required by the relevant laws and regulations of Laos and
Ghana, respectively, and provides employee benefits such as commercial insurance. Our Laos
Legal Advisor and our Ghana Legal Advisor are of view that, during the Track Record Period
and up to the Latest Practicable Date, we had complied with the applicable labor laws and
regulations in Laos and Ghana in all material respects, respectively. The majority of our
employees in Laos and Ghana are represented by labor unions.
TRANSFER PRICING
Transfer Pricing Arrangements
Intra-group transactions within Golden Star Resources prior to our acquisition of Golden
Star Resources
All the intra-group transactions between GSWL and the then group companies within
Golden Star Resources occurred outside of Ghana within the period from 2017 to 2020, prior
to our acquisition of Golden Star Resources in 2022.
GSWL and its related parties had intra-group loans and other operational support and
services arrangements during the period from 2017 to 2020. The parent company of GSWL
provided financial supporting to GSWL for its daily operational use with their own working
capital via intra-group loans, and GSWL was charged interest based on the principal
outstanding and interest rates varied ranging from 3.25% to LIBOR plus 11% during the
period. In the same period, GSWL’s parent company provided intra-group sales, management
and administration services to GSWL and charged GSWL a service fee of US$155,000 per
month.
Transfer pricing audit was conducted regularly by the Domestic Tax Revenue Division of
the Ghana Revenue Authority on GSWL in accordance with the relevant tax regulations in
Ghana to decide if the transactions between GSWL and related parties were conducted at arm’s
length and if GSWL complied with applicable transfer pricing laws. The latest audit performed
on GSWL in 2024 was related to the intra-group transactions during the period from 2017 to
2020.
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Ghana Revenue Authority considered the interest rate charged by related parties was
higher than market and concluded interest rate to be lowered by 2% on the outstanding
principal amount. They also considered some of the services provided by related companies
were without appropriate supporting as GSWL was not able to provide the relevant timesheet
and work done by the then Canada head office. GSWL lost some of its records when Golden
Star Resources was acquired by our Group and the Golden Star Resources’s head office was
closed in 2022 when head office tasks and duties were taken up by our Group.
GSWL received a tax demand notice of US$7,082,002.81 in May 2024 and GSWL has
charged the whole amount to income statement and increased tax provision at the same time.
GSWL has filed an application to Ghana Revenue Authority to waive US$3,700,000 under
Ghana Revenue Administration Act 2016 (Act 915) on the basis that GSWL voluntarily
disclose its liabilities. The waiver was granted on October 31, 2024 and the amount of
US$3,700,000 was reversed in the income statement and decrease tax provision in October
2024. As of the Latest Practicable Date, GSWL had fully paid the additional tax amount. No
penalty had resulted from this transfer pricing audit as of the Latest Practicable Date.
During the Track Record Period and up to the Latest Practicable Date, we had operations
in the PRC, Laos and Ghana. In order to ensure the efficient operation of our Group, during
the Track Record Period and up to the Latest Practicable Date: (a) our Company, as the
headquarter of our Group, provided integrated operational support and consulting services to
LXML and GSWL, including but not limited to downstream customer development services,
exploration services, mining and mineral processing technology services, IT system services
and other project-related business development, project delivery and other support services, (b)
our Company provided intra-group loans as one of the internal financing methods to our
subsidiaries, (c) our Company rented a property for our headquarters and received property
management services from a related party, and (d) one of our subsidiaries in PRC sold the
products it procured from domestic or overseas suppliers and provided the outsourced
procurement services of the hazardous chemicals to LXML and GSWL under our global
centralized procurement arrangement. In addition, post our acquisition of Golden Star
Resources in 2022, GSWL kept similar intercompany loan arrangement with our Group’s
subsidiaries. These transactions are regarded as transfer pricing arrangements. As such, we
have adopted transfer pricing arrangements to ensure compliance with relevant transfer pricing
regulations, including (i) monitoring implementation of internal control policy on tax-related
matters; (ii) monitoring updates on transfer pricing laws and regulations and assessment of
related risks to our Group; (iii) engaging benchmarking review on transfer pricing policy and
exposure; and (iv) designating our finance manager to regularly monitor our pricing policy of
transfer pricing arrangements to ensure such transactions follow the arm’s length principle in
accordance with relevant transfer pricing guidelines.
Transfer Pricing Assessment
The Organization for Economic Co-operation and Development (the “ OECD ”), an
international organization of international cooperation, promulgated the transfer pricing
guidelines for multinational enterprises and tax administrations (the “ OECD Transfer Pricing
Guidelines ”), which is generally followed by all tax jurisdictions involved in our transfer
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pricing arrangements including the PRC, Laos and Ghana. According to the OECD Transfer
Pricing Guidelines, our transfer pricing arrangements should be at arm’s length basis to avoid
distorted taxable income in different jurisdictions.
We engaged relevant transfer pricing consultants to conduct benchmarking studies on the
intra-group transaction of GSWL and the preparation of transfer pricing local file for the years
from 2021 to 2023. Based on the benchmarking analysis, the transfer pricing consultants traced
the market rates for similar transactions and compared to the rate charged by our Group to
GSWL and did not identify any transfer pricing arrangements of GSWL that did not align with
the arm’s length principle according to the OECD Transfer Pricing Guidelines.
Other than the above, in order to ensure compliance with the relevant transfer pricing
regulations, we have engaged independent transfer pricing consultants to conduct
benchmarking studies on the transfer pricing arrangements, for the year of 2021, the year of
2022 and the year of 2023, respectively, in accordance with the OECD Transfer Pricing
Guidelines, which primarily identified the arm’s length principles and/or profit range for the
transfer pricing arrangements. Transfer pricing consultants first selected the most appropriate
transfer pricing analysis methodology in its benchmarking studies based on the nature and
characteristics of the transactions. For the provision of procurement support services, the
transfer pricing consultants selected comparable uncontrolled price method (“ CUP”), which
compares the arrangements for the services in the transfer pricing arrangements to the
arrangements of transactions between independent parties under similar and comparable
circumstances.
Based on the transfer pricing reviews mentioned above, our transfer pricing arrangements
in 2021, 2022 and 2023 were generally within the profit range that was considered an
appropriate range for arm’s length transactions in 2021, 2022 and 2023. In addition, our Group
has prepared transfer pricing master file for each of 2021, 2022 and 2023 and relevant group
entities have prepared transfer pricing local files to fulfil the applicable transfer pricing
documentation compliance requirements. Our transfer pricing consultants, based on the
benchmarking analysis, did not identify any transfer pricing arrangements that did not align
with the arm’s length principle according to the OECD Transfer Pricing Guidelines. On this
basis, our Company is of the view that the above-mentioned transfer pricing arrangements of
our Group align with the arm’s length principle according to the OECD Transfer Pricing
Guidelines.
Our PRC Legal Advisor is of the view that during the Track Record Period and up to the
Latest Practicable Date our transfer pricing arrangements had complied with all applicable
PRC laws and regulations in all material respects, on the basis that the transfer pricing of our
transfer pricing arrangements during the Track Record Period and up to the Latest Practicable
Date was fair.
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Our management had been and will continue to closely monitor our Group’s transfer
pricing arrangements including reviewing the reasonableness of the pricing policy of our
transfer pricing arrangements from time to time. However, we cannot assure that our transfer
pricing arrangements will not be subject to review and possible challenge by any relevant tax
authorities in future, even though we believe we have reasonable grounds to defend ourselves
against such possible challenge. Please refer to the section headed “Risk Factors — Risks
Relating to Our Business and Industry — We are subject to regulatory risks with respect to our
tax compliance” in this Prospectus for further details.
ENVIRONMENTAL, SOCIAL AND GOVERNANCE
We believe that our efforts in environmental, social and governance matters are the key
factors for our long-term sustainable development and continued business success.
Accordingly, we attach great importance to the implementation of environmental, social and
governance policies at the highest level of our Company.
International industry standards and best international practices have been applied in our
overseas mines and the same standards are adopted in our domestic mines on a step-by-step
basis. For instance, we have been in compliance with various gold and/or mining industry
standards, such as the World Gold Council Conflict-Free Gold Standard and World Gold
Council Responsible Gold Mining Principles. Although we are not a member of the World Gold
Council and are not obligated to follow its standards, we align our policies with these
guidelines to ensure gold is responsibly produced under strict ESG governance. We prioritize
human rights for employees and communities, avoid involvement in conflicts, and conduct
rigorous risk assessments across the supply chain. Suppliers are required to uphold ethical
practices, prioritize safety and occupational health, and minimize potential harm. We
continuously evaluate and improve our ESG performance and enforce systems to ensure legal
and sustainable mining practices.
Furthermore, we have also been in compliance with the International Council on Mining
and Metals’ Tailings Governance Position Statement and Global Industry Standard on Tailing
Management. Although we are not members of the International Council on Mining and Metals
(ICMM), we establish institutional standards and management practices by adhering to relevant
guidelines, local regulations, and site-specific laws at each mine. This enhances the safety and
environmental performance of tailings management, aligning with higher standards to mitigate
risks of tailings dam failures and environmental leakage incidents.
In addition, GSWL executes ESG procedures in accordance with the standards required
by the World Gold Council (WGC) and the United Nations Global Compact (UNGC) and
publishes ESG reports on a regular basis. LXML have observed and continues to observe the
standards of International Council on Mining and Metals (ICMM). We are making efforts to
make our domestic mines in better compliance with WGC standards by consolidating the
governance of our domestic and overseas mines as well as finetuning our ESG-related
management policies and continue to improve the ESG governance of our mines including
disclosure of relevant ESG information.
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Our Board has extensive ESG experience and expertise. For instance, our Chairman
achieved significant success in building green tailings-free mines during his tenure at
Shandong Gold, with three mines being listed by the Ministry of Land and Resources as the
first batch of national-level green mines in 2011. During his tenure at Zijin Mining, nine mines
were awarded as national and provincial pilot units for green mining.
In addition, we have established a sound ESG-governance structure under which the
Board formulates our overall ESG strategies and goals. The Strategy and Sustainable
Development Committee under the Board is mainly responsible for undertaking research on
mid- and long-term development strategies, major investment decisions and sustainable
development policies and providing detailed recommendations. It also assists in identifying
ESG risks, evaluating the material ESG issues, coordinating internal and external resources for
managing ESG matters and implementing our ESG strategies. The members of the Strategy and
Sustainable Development Committee include Chairman Wang, Ms. Y ang Yi-fang, Mr. Lyu
Xiaozhao, Mr. Zhang Xudong and Dr. Wong Y et Ping Ambrose. In addition, our senior
management, in particular our Environment Department, is responsible for the daily execution
of our various ESG policies, analyzing the various ESG matters and opportunities and
preparing the materials and annual reports on our ESG performance. In accordance with the
ESG work plan set by the Board, the ESG core team and various departments, along with the
ESG responsible staff at each mine, will implement specific ESG tasks. They will also
supervise and support each department in carrying out the plan, report to management on a
regular basis, gather statistics, and analyze ESG data and information on a daily bases, and
assist in the preparation of the annual ESG report. The Board participates in the analysis and
evaluation of the materiality of the Company’s ESG issues and the identification of ESG risks,
and approves substantive issues that have a significant impact on the Company. The Board also
determines the Company’s priorities for sustainable development, and guides affiliated
enterprises to establish an ESG targets management system that covers metrics such as
pollutant emissions, energy consumption and water resource management. Besides, the Board
keeps an eye on the execution of goals and reviews its progress. Key performance indicators
in relation to environmental protection are also incorporated into our performance evaluation
system for our employees. The comprehensive ESG-governance structure we have developed
has laid a solid foundation for our ESG performance.
We set up metrics and targets to assess and manage ESG related risks. For instance, we
consistently keep a close eye on two key indicators that have substantial impacts: carbon
emissions and tailings management. In 2023, our total greenhouse gas emissions amounted to
634,850.38 tonnes of CO
2 equivalent. We are tackling climate pressures stemming from
production activities through combined efforts in energy-saving technologies and the adoption
of clean electricity/energy. We give top priority to the most energy-efficient and
environmentally friendly equipment for all newly-built mineral processing plants and are
gradually phasing out high-energy-consuming machinery at existing facilities. In line with
national policies, we actively boost the use of renewable energy and engage in green power
trading. Our long-term goal has been set to achieve net-zero carbon emissions. In 2023, we
generated and discharged 12,178,458.00 cubic meters of tailings. In addition, 25,095,662.00
tonnes of non-hazardous tailings or waste rock were recycled through donations, sales, or other
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methods. Going forward, we plan to implement cleaner technologies in mineral processing and
ore treatment (e.g., tailings cement backfill) to increase the proportion of recyclable tailings,
further enhancing reuse rates through underground backfilling or community-beneficial
applications.
We may not be able to fully comply with these international industry standards at all
times, which may impact our business, reputation, our results of operations and our ability to
raise funds or obtain financing if we are perceived to have deficiencies in our ESG practice.
For details, see “Risk Factors — The failure of a tailings storage facility could negatively
impact our business, reputation and results of operations” and “Risk Factors — Maintaining
and increasing compliance of industry standards and keeping sufficient ESG disclosure to
maintain our reputation and care for local communities could increase our operation costs”.
The ESG core group collaborates with various company departments and ESG leaders of
the mining areas to implement specific ESG tasks based on the ESG work plan established by
the Board of Directors and Management. It also oversees and supports each department in
achieving their planned ESG objectives. Furthermore, the ESG core group regularly reports to
Management, handling the daily collection, statistics, and analysis of ESG data and
information. Management, in turn, reports to the Board and the Shareholders’ Meeting, which
then make decisions on significant ESG matters.
We determine the most important issues in ESG management and information disclosure
by assessing their significance to our growth and to internal and external stakeholders. The
chart below illustrates the elements we use to assess the materiality of ESG risks. We carry out
ESG review annually through a three-level progress and risk reporting mechanism:
We aim to continuously enhance our systematic environmental management system,
optimize water resources, energy, and logistics management strategies, judiciously use natural
resources, practice the principles of a circular economy, strictly control tailings, waste,
wastewater, and pollutant management, and minimize the negative impact on the natural
environment. Simultaneously, we actively address climate change, consider potential climate
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risks and opportunities impacts following the framework recommendations of TCFD,
continuously increase the proportion of renewable energy use through self-built photovoltaics
and participation in green energy trading, as well as contribute to reduction of low-carbon
emission.
We always prioritize the construction of green mines, actively seek a balance between
mining development and ecological protection and strive to adhere to the development concept
of “Mutual Prosperity and Development” with the community. In 2023, (i) our total investment
in green mine construction was RMB26.2 million; (ii) we restored approximately 62.3 hectares
of land; (iii) we conducted workplace safety inspections 2,375 times in 2023; (iv) provided
safety training for 33,495 participants; (v) no significant safety or environmental accidents
occurred; (vi) we reduced approximately 1,057.4 tonnes of carbon dioxide and its equivalent;
and (vii) we invested RMB51.8 million in research and development.
For more details, please see “— Competitive strengths — A strong social responsibility
and solid commitment to promoting green and sustainable development with high ESG
standards” and “— Business strategies — Continue to improve our ESG governance and
enhance our standards of environmental protection, safety, social responsibility and corporate
governance.”
It is our policy to adhere to international conventions and the labor laws and regulations
of the countries where we operate, as well as the relevant labor management standards. Under
the guidance of the Responsible Gold Mining Principles regarding “wages and benefits,” “child
and forced labor,” “freedom of association and collective bargaining,” we legally and
compliantly carry out labor management work. We have established a comprehensive talent
management system and clear recruitment and dismissal policies. Our policies strictly prohibit
use of child labor and forced labor and protect human rights of our employees. In order to
ensure compliance with our policies of prohibiting child and forced labor, we have formulated
a series of employment management related measures which are incorporated in the Employee
Handbook and Recruitment Norms and Procedures. These documents set out detailed measures
and requirements for our staff recruitment process such as pre-employment age and identity
verification, working hours, rest periods, equal opportunities and other benefits and welfare.
During the recruitment of employees, we strictly check the ages and backgrounds of the
candidates to prohibit the use of child labor and forced labor complaint. In addition, employees
are encouraged to report to our management team or submit labor complaint, anonymously
through designated reporting channels or by sending email to a special complaint mailbox, to
the labor union or the human resource department of the relevant subsidiary, if they identify
any child or forced labor issues. Furthermore, to prevent human trafficking, we mandate that
all suppliers and contractors adhere to anti-human trafficking standards as part of contractual
agreements with us and provide mandatory training for all employees on recognizing and
preventing human trafficking, including indicators of forced labor and exploitation. We
maintain a holiday and welfare system, and a transparent employee communication
mechanism.
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We prohibit all forms of corruption and bribery and require our employees to comply with
the anti-bribery laws and regulations applicable in the countries where they work and the
countries where they conduct business. We have established a set of policies and regulations,
including the “Company Anti-Corruption and Bribery Policy,” “Company Integrity and
Self-Discipline Management System,” “Company Code of Business Conduct,” and for each
subsidiary, the “Practical System for Integrity and Anti-Corruption” and “Employee
Disciplinary Action Regulations,” demonstrating our zero-tolerance and stringent investigation
stance towards bribery and corruption. We hold anti-corruption training for our Directors,
senior management and employees on a regular basis. In 2023, we held a total of 61
anti-corruption training sessions.
Our PRC Legal Advisor has confirmed that, during the Track Record Period and up to the
Latest Practicable Date, we were not subject to any material claim or penalty in relation to
health, work safety, social and environmental protection.
Environmental Protection
We are fully committed to environmental protection and to adhering to the highest
standards for sustainable development. Our business operations are subject to various legal
requirements in relation to environmental protection, such as air pollution, water discharge,
waste disposal and noise control, under the relevant PRC, Lao and Ghanaian laws and
regulations. For more details, see “Regulatory Overview.”
Our Environmental Protection Policy
In order to systematically address the various environmental protection matters arising
from our operations, we have formulated environmental protection policies and measures by
following the relevant principles of the International Council of Mining and Metals, which set
out the detailed procedures for undertaking various environmental protection work.
In China, we have established a complete environmental protection system to comply
with regulations on environmental protection and control pollutant emissions. Our mining and
processing are carried out in accordance with relevant standards and management. In
particular, our decyanidation process complies with the requirements of the Technical
Specification for Cyanide Residue Pollution Control in the Gold Industry (ݑ
છՓҦஔ஝ᇍ).
At LXML in Laos, we have formulated an environmental and social management and
monitoring plan by following the Environmental and Social Impact Assessment Guidelines,
which sets out a policy framework, management system and environmental monitoring plans
in order to achieve full compliance with the relevant regulatory requirements and industrial
standards. Such plans are subject to review and update at least every three years.
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At GSWL in Ghana, we have established a general policy on environment together with
comprehensive environmental management plans for both surface operations and underground
operations after considering the specific environmental factors in Ghana. Such plans are
subject to review and update at least every three years.
Our environmental protection policies and measures generally cover the major aspects of
our operations, such as:
 Hazardous materials . We reinforce the groundwork at our industrial sites and store
raw materials in our facilities in a way which prevents leakage of hazardous
materials into the soil. Hazardous waste is segregated into specific color-coded
waste receptacles. Generally, explosives packaging and cyanide packaging are
removed for disposal by the relevant suppliers.
 Prevention of air pollution . In relation to processing plants, dust suppression
sprays are utilized and dry dust collection systems have been installed on ore
crushing circuits/conveyor belt transfer points. In relation to underground mining,
we install major ventilation systems (including ventilation exhausts) and use water
for dust suppression.
 Wastewater treatment . We have constructed water recycling systems to ensure that
wastewater will be recycled for use as far as practicable. For wastewater which will
be released to the external environment, we ensure that the wastewater must go
through sediment retention systems before being discharged. We carry out relevant
treatment at tailings dams to prevent groundwater pollution. We also maintain
comprehensive database of processed water data.
 Solid waste . Scrap steel and other clean underground wastes are collected for
beneficial re-use where appropriate. Lead batteries are recycled by accredited
vendors. We also employ a waste compactor to reduce landfill volumes and
associated emissions. In addition, we divert wooden materials, plastics, and other
recyclables away from landfill for recycling by approved vendors, thereby reducing
landfill volumes and associated emissions.
 Noise control . We take various measures to reduce the noise generated in our
operations, such as selecting low-noise equipment and machinery, installing
silencers, and adsorption materials, as well as noise isolation and elimination
equipment.
 Tailing Storage . Extensive monitoring systems are included in the design of tailings
dams as early warning mechanisms. These systems also enable ongoing assessment
of the stability and integrity of the structures. Qualified engineers conduct quarterly
inspections as per international standards. In addition, independent auditors conduct
regular third-party audits.
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 Biodiversity . Flora and fauna assessments and updates are undertaken to ensure
appropriate planning and impact management. In the context of agreed post-mining
land use, sequential re-vegetation is conducted for the establishment of self-
sustaining ecosystems. We transplant various exotic and indigenous species to
enhance biodiversity. There is also waste receptacle management to reduce risk of
vermin infestation.
We started publishing scope 1, 2 greenhouse gas emissions, generation of hazardous
waste and use of resources in our ESG report since 2023. The following tables illustrates the
scope 1, 2 greenhouse gas emissions, generation of hazardous waste and use of resources in
2023:
 Greenhouse Gas Emission
Indicator 2023
Scope 1 Greenhouse Gas Emissions (tonnes of carbon dioxide
equivalent) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118550,970.04
Scope 2 Greenhouse Gas Emissions (tonnes of carbon dioxide
equivalent) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111883,880.34
Total Greenhouse Gas Emissions (tonnes of carbon dioxide
equivalent) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118634,850.38
Note: We have not yet disclosed our Scope 3 greenhouse gas emissions, but we are in the process of
improving our Scope 3 emissions accounting system and will gradually cover our business’s
upstream and downstream activities. We expect to disclose our Scope 3 greenhouse gas emissions
around the year of 2028.
 Generation of Hazardous Waste
Indicator 2023
Hazardous Waste Amount (excluding sludge) (t) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,292.39
Sludge Output (L) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111843,580,000.00
 Use of Resources
Indicator 2023
Petrol Consumption (kWh) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118131,578.89
Diesel Consumption (kWh) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,158,766.22
Natural Gas Consumption (kWh) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118115,210.71
Total Energy Consumption (kWh) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118155,738,408.03
Total Energy Consumption Intensity (kWh/sales amount
RMB10k) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118215.813
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In addition, due the rapid advancement of environmental protection laws, regulations and
industry standards, we closely monitor the latest developments in regulations and standards and
regularly update our environmental protection policies and measures with the aim to ensure and
uphold the highest standards possible.
Our ESG Practice in the PRC
We are committed to environmental protection by strict adherence to all the relevant laws
and regulations in the PRC. We have adopted the relevant environmental protection measures
required by such authorities, including carrying out environmental self-monitoring programs in
relation to dust, noise, water, soil and discharges. These subsidiaries follow the relevant
self-monitoring technical guidelines, have prepared the relevant special emergency plans in
case of an accident and employ qualified third-party test units to conduct routine monitoring.
At our other subsidiaries, we employ various environmental protections to monitor the
emissions and discharges to ensure we operate within the relevant standards. We are also
dedicated to the construction of green mines and applying tailing dewatering technology with
the aim of achieving zero discharge of sewage from our gold mines.
During the Track Record Period and up to the Latest Practicable Date, our cost of
compliance with the applicable environmental protection rules and regulations in the PRC
amounted to RMB98.8 million, RMB95.1 million, RMB187.8 million, RMB49.4 million and
RMB35.9 million, respectively. Moving forward, we expect our environmental protection rules
and regulations will maintain at a similar level.
Our efforts and investments in environmental protection has led us to various
achievements. For example, (i) Jilong Mining has planted more than 3,000 trees and grown
grass covering an area of more than 2.4 hectares in the first half of 2022; (ii) Huatai Mining
has achieved 100% recycling of all its wastewater; (iii) as of the Latest Practicable Date,
Hanfeng Mining had undertaken afforestation of an area spanning more than 2,400 m
2 and
green conservation of an area spanning more than 8,300 m 2; and (iv) GSWL mainly obtains
electricity from a local gas-fired power plant and also engages with a hydro-power energy
provider. In addition, we are exploring various options for renewable energy projects with an
aim to achieve a 30% reduction in greenhouse gas emission intensity by 2030. In particular,
Jilong Mining is planning to build a 10-megawatt solar power plant, and it is expected that its
full capacity will be installed and ready for commercial operation by the end of 2025.
Meanwhile, Wulong Mining and LXML are also actively planning to build their own clean
energy power generation projects, which will further enhance our capability in renewable
energy utilisation.
We have undertaken a number of environmental protection technology research projects.
This has allowed us to develop numerous environmentally friendly technologies and processes,
which enable us to limit the environmental impact of our production activities. For instance,
we have carried out special research on the discharging process at the Jilong Gold Mine and
Huatai Gold Mine and, as a result, have adopted the “tailings decyanation filter pressing
process” to replace the original tailings filter discharge process, and the content of total
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cyanide tailings and other harmful elements conforms to requirements of the PRC’s Technical
Specification for Pollution Control of Cyanide Leaching Residue in Gold Industry (Бุ
છՓҦஔ஝ᇍ). This change represented a new approach to cyanide
residue tailings processing of ore in the PRC. Since commencing in October 2018, the project
has been running stably. Sampling and testing of the treated cyanide tailings by third parties
have shown that the total cyanide concentration in the toxic leaching solution is all less than
4mg/L, which is significantly under the limit of 5mg/L for tailings dam disposal in the
technical specification of cyanide residue, and other indicators are all in line with the
specification requirements.
For our continuous and significant efforts over the years, we have successively won and
been awarded various honorary titles, such as “Advanced Unit of Energy Conservation and
Emission Reduction during the 12th Five-Y ear Plan Period” ( ɤɚʞືঐಯર΋ආఊЗ),
“National Outstanding Enterprise Practicing Ecological Civilization” (ᎴӸ
Άุ) and “Advanced Collective of Energy Conservation and Emission Reduction of National
Machinery, Metallurgy and Building Materials Union System” (ҿʈึӻ୕ື
ঐಯર΋ආණ᜗). In January 2024, our Company was awarded the 17th Crystal Ball Award as
the “2023 Most Socially Responsible (ESG) Listed Company”. In addition, (i) the Jilong Gold
Mine and Hanfeng Polymetallic Mine were rated as National Green Mines ( Ό਷ၠЍᘤʆ)i n
January 2020, and (ii) the Wulong Gold Mine and Huatai Gold Mine were rated as Provincial
(Autonomous Region) Level Green Mines (޲(ਜ)ॴၠЍᘤʆ) in December 2020 and May
2020, respectively. All these achievements and honors is a testament to our relentless efforts
in environmental protection and dedication for long-term sustainable development.
Our PRC Legal Advisor is of view that, during the Track Record Period and up to the
Latest Practicable Date, we did not have any material incidents of non-compliance with the
PRC environmental laws and regulations at our mines in the PRC that resulted in material
penalties. In addition, we are not aware of any environmental proceedings or investigations to
which we were or might become a party that could have a material adverse effect on our
business, financial conditions and results of operations.
We are in compliance with laws and regulations governing land restoration and
environmental rehabilitation in PRC, such as Environmental Protection Law of the People’s
Republic of China, Law of the People’s Republic of China on Prevention and Control of Soil
Pollution, Law of the People’s Republic of China on Soil and Water Conservation, Grassland
Law of the People’s Republic of China, Land Administration Law of the People’s Republic of
China, Implementation Measures for the Land Reclamation Regulations. Pursuant to the
relevant PRC laws and regulations, we are responsible for the rehabilitation of the land in
relation to our mining activities and are required to submit a land rehabilitation plan to the
relevant governmental authorities for examination when applying for or renewing our mining
licenses. Before commencing mining activities, we are also required to deposit funds into an
environment control fund set up with banks in amounts agreed with the relevant governmental
authorities. The land rehabilitation fund is owned by us while the use of these funds is under
the supervision of the relevant governmental authorities. During the Track Record Period and
up to the Latest Practicable Date, we had fully paid the aforementioned funds in a timely
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manner and are committed to strictly performing the approved rehabilitation plan. As our mines
in the PRC are still in production, we have not taken any further actions in relation to mine
closure and rehabilitation. For details of relevant risks, see “Risk Factors — Risks Relating to
Our Business and Industry — Our operations are exposed to risks in relation to environmental
protection and rehabilitation” and “Risk Factors — Risks Relating to Our Business and
Industry — Our existing mining operations have a finite life and eventual closure of our
operations will entail costs and risks regarding on-going monitoring, rehabilitation and
compliance with environmental standards, which may exceed the provisions we have made.”
Our ESG Practice in Laos
Our environmental protection practices in Laos are guided by the “10 Sustainable
Development Principles” of the International Council of Mining and Metals. We seek to
continuously improve our environmental protection performance by carrying out
environmental sampling and monitoring, setting suitable environmental protection targets,
implementing and maintaining procedures to identify environmental risks, undertaking
thorough investigations of the root causes of environmental risks and proactively implementing
corrective measures. In particular, we actively undertake water/sediment management and
treatment, drainage on mine infrastructure, waste dump control and tailing management.
During the Track Record Period and up to the Latest Practicable Date, our cost of
compliance with the applicable environmental protection rules and regulations in Laos
amounted to approximately US$1.0 million, US$1.4 million, US$1.2 million, US$0.9 million
and US$0.3 million, respectively. Moving forward, we expect the local environmental
protection rules and regulations will be maintained at a similar level.
In relation to rehabilitation, LXML will enter the closure phase when no more
development and ore extraction take place. Once ore has been removed, pit voids are either
retained in a “care and maintenance” phase or closed and rehabilitated. Open pits are placed
in care and maintenance if they have the potential to yield economic amounts of ore in the
future. During the care and maintenance phase, pits walls are stabilized to minimize erosion
and any exposed and potentially acid forming material is removed or covered with non-acid
forming material and/or water is treated and released. We are in compliance with laws and
regulations governing land restoration and environmental rehabilitation in Laos, such as
Environmental Protection Law, Mineral Law, Decree on Environmental Impact Assessment,
Decision on Environmental Technical Monitoring in Investment Projects and V arious Activities
of the Natural Resources and Environment Sector.
We have filed a mine closure plan with the relevant governmental authorities, and we
continue to refine such plan to incorporate new understanding and contemporary best practice.
Mine closure planning is undertaken in close consultation with stakeholders; primarily through
the mine closure committee. We have also prepared progressive rehabilitation and reclamation
plans, including erosion control, vegetation establishment, and planting and plant maintenance,
which seeks to yield significant results in the establishment and regeneration of the natural
environment.
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We have established a mine closure fund in Laos. We have made a deposit in an aggregate
amount of approximately US$9.0 million into the mine closure fund as of September 30, 2024,
which is held in two Lao commercial banks. We expect to continue to contribute to the fund
based on the volume of mineral sales for the entire term of the project. Pursuant to an
agreement with the Lao Government, in respect of the future rehabilitation expenses to be
incurred in order to fulfill our Group’s environmental responsibilities, we have made a
financial provision in the amount of US$236 million for the rehabilitation works to be carried
out in the future covering the entire undiscounted projected mine closure amount of US$247
million based on the latest approved mine closure plan and the latest disturbance area and
rehabilitation work unit price.
The Laos law provides three modes for the mine closure fund guarantee, including cash
guaranty, bonds, and other financial instruments, which is provided in annual installments
throughout the term of the project. Nevertheless, according to the Laos Legal Advisor,
considering the prevailing circumstances in Laos, the approach of cash deposit, coupled with
financial provision, with fund contribution according to the agreement with the Lao
Government, is commonly encountered. The Laos Legal advisor is of the view that, the
enforcement risk for LXML’s approach to its mine closure fund is minimal, and the likelihood
of LXML being subject to penalty in this respect remains remote, on the following bases:
(i) LXML bank statements for the mine closure fund with a total bank balance of
approximately US$9.0 million, which we understand will be used for mine site
rehabilitation exclusively, and that LXML will continue to contribute into the fund
on installment basis corresponding to the gold and copper sales per oz, in
accordance with the MEPA with the Lao Government;
(ii) since the acquisition of LXML, there has been proactive and ongoing
communication with relevant Lao government authorities regarding the mine closure
fund; and
(iii) LXML has not received any instruction on the detailed implementation of the mine
closure fund contributions from the Lao government authorities or notice of
deficiency regarding its current mine closure fund.
Our Laos Legal Advisor is of view that, during the Track Record Period and up to the
Latest Practicable Date, we did not have any material incidents of non-compliance with the
Laotian environmental laws and regulations at our mines in the Laos that resulted in material
penalties. In addition, we are not aware of any environmental proceedings or investigations to
which we were or might become a party that could have a material adverse effect on our
business, financial conditions and results of operations.
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Our ESG Practice in Ghana
Our environmental protection practices in Ghana are guided by principles similar to those
adopted in our Laos operations, which assists us in maintaining our environmental protection
practices at international standards. As such, our operations in Ghana apply measures to
mitigate pollution and environmental impact and improve our overall environmental protection
system and performance.
During the Track Record Period and up to the Latest Practicable Date, our cost of
compliance with the applicable environmental protection rules and regulations in Ghana
amounted to approximately US$3.3 million, US$2.3 million, US$1.6 million and US$0.8
million, respectively. Moving forward, we expect the local environmental protection rules and
regulations will be maintained at a similar level.
GSWL also undertakes an annual comprehensive corporate responsibility review in
relation to our performance and compliance with the UN Global Compact framework and
targets aligned with the Sustainable Development Goals indicators.
In recognition of its focus on safety, GSWL was honored with the Ghana 2023 Best Safe
Mine First Prize from the Ghana Chamber of Mines in November 2023. Furthermore, GSWL
undertakes ongoing rehabilitation activities, which include re-profiling waste dumps, topsoil
spreading, and planting for both slope stabilization and long-term rehabilitation. We intend to
strictly follow the requirements as stipulated by Ghanaian Mining Law 2012 (LI 2182)
regarding rehabilitation activities. As we acquired the Ghanaian operations in January 2022, we
are in the process of preparing environment impact assessment report, which will include plans
for mine closure and rehabilitation, and we will submit this report to the relevant governmental
authorities for approval in due course. We will then enter into rehabilitation guarantee
agreement with the government and pay a rehabilitation deposit, which can only be returned
to us after inspection and acceptance of the rehabilitation project by the Ghana government.
We are in compliance with laws and regulations governing land restoration and
environmental rehabilitation in Ghana, such as Environmental Protection Agency Act 1994
(Act 490) and Environmental Assessment Regulations, 1999 (LI 1652). Our Ghana Legal
Advisor is of view that, during the Track Record Period and up to the Latest Practicable Date,
our operations in Ghana complied with applicable Ghanaian environmental laws and
regulations in all material respects.
Corporate Social Responsibility
We place great emphasis on fulfilling our corporate social responsibilities and are
committed to ensuring that the communities and regions in which we operate can genuinely
benefit from our development. We actively explore solutions that can bring a positive impact
to the local community. We take practical actions in promoting employment, rural
revitalization, improving people’s livelihoods, public welfare education, increasing tax
revenue, and other areas.
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We have established a well-built set of policies to guide our activities, including: (i) a
stakeholder and community relations policy for LXML; and (ii) a policy on community
relations and policy on community development and support for GSWL. We are also subject
to community audits undertaken by relevant governmental authorities on a regular basis. In
particular, in Ghana, we have strived to promote our philosophy of localized management and
operations, built up a sound relationship with local governmental authorities, served local
communities and took initiatives to contribute to regional development. We were one of the
first batch large-scale Chinese mining company operating in Ghana and, in recognition of our
work, earned accolades for boosting the local economy.
We actively participate in a wide range of community services in China, Laos and Ghana,
which we believe have been well regarded by both local communities and governments. For
more information regarding our corporate social responsibility efforts, please see “—
Competitive strengths — A strong social responsibility and solid commitment to promoting
green and sustainable development with high ESG standards.”
We leverage our own resource advantages, take action to shoulder corporate social
responsibility, and share our achievements with the societies within which we operate. For
example:
 Jilong Mining has donated more than RMB15 million to local primary schools in
need of financial support.
 To address the temporary housing requirements of the residents in the area during
the demolition phase, Hanfeng Mining formed an emergency task force to establish
temporary relocation facilities for the Tianbaoshan community residents, actively
supporting the local community in facilitating the resettlement process for the
displaced individuals.
 During the COVID-19 pandemic, Wulong Mining donated RMB600,000 in cash and
RMB200,000 in medical and protective equipment to the epidemic prevention and
control department.
 During the COVID-19 pandemic, Jilong Mining donated more than RMB300,000 in
cash and medical and protective equipment to the epidemic prevention and control
department.
 LXML established a partnership with the Laos Ministry of Health, the Lao Women’s
Union and UNICEF and provided US$2.9 million to the 1,000 Day Project in order
to improve maternal health and child nutritional outcomes.
 LXML also made donations of US$3.1 million to Vilabouly, Savannakhet and
Mittaphab hospitals for purchase of various medical equipment.
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 LXML donated US$11 million to the Community Trust Fund and US$3.26 million
to the Village Development Fund in order to improve access to basic services to the
underprivileged local residents.
 LXML actively assisted the Laos Government and local community with COVID-19
prevention with an aggregated donation of more than US$370,000.
 GSWL established the Golden Star Development Fund to make contributions of
US$1 per oz of gold produced at GSWL together with 0.1% of pre-tax profit for the
development of the local community near its mine. GSWL contributes
approximately US$200,000 each year into this fund.
 As of December 31, 2023, GSWL had rehabilitated approximately 416.9 hectares of
land, demonstrating our unwavering dedication to sustainable practices.
 In April 2006, GSWL established the Golden Star Oil Palm Project to make
contributions of US$1 per oz of gold produced at GSWL to assist to develop
post-mining land uses and productive assets to achieve sustainable local economic
development. Such oil palm trees also have a very positive impact on reduction of
greenhouse gases as forestry and agroforestry systems which incorporate tree crops
render a significantly larger sequestration potential for longer periods. By the end of
2021, GSWL had directed over US$9.6 million to this initiative, which assists
around 400 local farmers and creates approximately 400 temporary job positions. In
2021, GSWL received the inaugural ESG Award for Products at the Mines and
Money Outstanding Achievement Awards. In 2022, with the support of the United
Nations Industrial Development Organization, the Golden Star Oil Palm Project was
awarded as an international certificate from the Round Table on Sustainable Palm
Oil. By December 31, 2023, we have grown more than 140,000 oil palm trees in ten
different communities covering more than 1,000 hectares of land.
 We also set up the Community Mine Consultative Committee to select community
projects for assistance in order to support community-driven and community-owned
development.
Occupational health and safety
We adopt high safety standards, continuously update and enhance our internal control
measures to enhance production safety in our operations. Our production management systems
and technologies enable us to achieve automation, digitization, and intelligence control in the
gold production process. During the Track Record Period and up to the Latest Practicable Date,
we did not have any material safety incidents involving our workforce.
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We have implemented safety guidelines on employees’ proper use and maintenance of
equipment. Our employees are required to wear protective gear such as safety helmets, work
clothes, gloves, waterproof boots, dust masks and self-rescue devices, to ensure their safety at
work, taking into account the level of risk of the particular task or production site. We conduct
inspections on the condition of our employees’ protective gear before they enter production
sites. We offer regular training on health, safety and accident prevention to our employees from
time to time.
In addition, we have established and implemented comprehensive safety protocols and
periodically evaluate the sufficiency of our protocols. Regular evaluations are conducted to
identify and address potential health and safety risks in alignment with our internal work safety
policies, ensuring that all production activities are carried out in a safe manner. For safety
facilities within our mines, we conduct regular checks and maintenance to ensure they provide
reliable protection for work safety. A dedicated safety responsibility team is in place to
regularly inspect the implementation of work safety measures, identify potential issues, and
address them promptly.
At the subsidiary level, we organize cross-functional teams from various operational units
to hold monthly meetings. These meetings focus on reviewing each step of the production
process and identifying major potential work safety risks, enabling proactive measures to
mitigate them. This structured approach underscores our commitment to maintaining a safe and
secure working environment for all employees.
Our PRC Operations
Our business in the PRC is subject to extensive work safety laws and regulations
governing our operations. We have also put in place stringent internal policies and procedures
with respect to safe use of equipment and consumables, handling of hazardous materials and/or
waste, detection and management of work safety issues and regular work safety inspection. In
particular, we have formulated detailed guidelines on treatment of hazardous waste. During the
Track Record Period and up to the Latest Practicable Date, we believe we had adopted all the
occupational safety measures as required under the PRC laws.
In addition, we have adopted relevant systems for recording and handling accidents
during operations and provided work safety trainings to our employees on an annual basis in
order to strengthen their knowledge and awareness. To maintain a safe work environment, our
employees are required to report accidents to a designated person for further actions. We are
required to promptly report on the occurrence of any loss, leakage or diffusion of hazardous
waste to the relevant health authorities and to keep proper records of such accidents. Our
operations are subject to regulations and periodic examinations by local work safety
authorities. We have obtained all the material work safety permits, approvals and registrations
necessary to conduct our business.
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As advised by our PRC Legal Advisor, during the Track Record Period and up to the
Latest Practicable Date: (i) we believe we were in compliance with all applicable work safety
laws and regulations in the PRC in all material respects; (ii) save as disclosed in the prospectus,
we did not have any material incidents of work-related injuries or casualties; (iii) we had not
been subject to any claims for personal or property damages and compensation to our
employees which were material to our business operations; and (iv) no material administrative
sanctions or penalties had been imposed upon us for any violation of work safety laws and
regulations. We have not incurred, and do not expect to incur material costs in connection with
the compliance with work safety laws and regulations.
Our Operations in Laos and Ghana
Similarly, for our operations in Laos and Ghana, we are subject to the relevant
occupational health and safety laws and regulations in Laos and Ghana. We have put in place
comprehensive safety and health management systems to maintain compliance with the
relevant laws and regulations and monitor the safety of our operations. As advised by our Laos
Legal Advisor and our Ghana Legal Advisor, we believe we were in compliance with applicable
laws and regulations in Laos and Ghana, respectively, in relation to occupational health and
safety in all material respects and there were no significant or recurrent health or safety
accidents during the Track Record Period and up to the Latest Practicable Date.
Safety Accidents
Fatal accidents
On March 16, 2022, an employee of Huatai Mining violated underground internal
operation protocols by entering into a prohibited mining area, which led to a collapse of one
drift of the mine and the fatal accident. Huatai Mining was fined RMB650,000 by the Chifeng
Song Shan District Emergency Management Bureau on May 30, 2022. Huatai Mining paid the
fine on May 31, 2022, compensated the relatives of this employee and completed rectification
as required. On June 4, 2023, an employee of Dongfeng Mine of Hanfeng Mining fell from
height and died. The accident investigation team identified issues including failure to promptly
discover and eliminate potential accident hazards and to supervise employees in strict
implementation of production safety protocols. Longjing City Emergency Management Bureau
imposed a fine of RMB350,000 on Hanfeng Mining. Hanfeng Mining paid the fine,
compensated the relatives of this employee, and completed rectification as required.
Subsequent to these incidents, we have enhanced relevant internal control measures,
including strengthening a series of internal policies regarding production and operational
safety and conducting systematic training on production safety and safety emergency drills.
Our internal control consultant examined our internal controls over production safety in
May 2024, and assisted us in further strengthening internal control procedures on production
safety. During the follow-up review by our internal control consultant in May 2024, no material
deficiency in our internal control procedures on production safety was identified.
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Based on the due diligence conducted by the Sole Sponsor including but not limited to
engaging in discussion with the Internal Control Consultant to understand its findings and
obtaining and review of the underlying policy and procedures together with the sample internal
reports, the Sole Sponsor concurs with the aforementioned views of the Internal Control
Consultant.
Our PRC Legal Advisor is of the view that neither of these accidents constitutes a material
safety production accident nor has any material adverse impact on our Group’s business
operations or financial condition due to the following reasons:
(i) the document of approval issued by the People’s Government of Chifeng Songshan
District on May 18, 2022, which agreed with the conclusion of the investigation
report prepared by the accident investigation team, identified this accident as a
general production safety responsibility accident. In addition, according to Article 3
of the Regulations on the Reporting and Investigation of Production Safety
Accidents , a general accident refers to an accident that results in the death of less
than three people, or serious injuries to less than ten people, or direct economic
losses of less than RMB ten million;
(ii) Hanfeng Mining has obtained a special explanation from the Longjing City
Emergency Management Bureau, stating that the accident for which we received the
administrative penalty according to the Article 114 of the Work Safety Law of the
People’s Republic of China, was a general production safety accident, not a major
violation of laws and regulations;
(iii) according to the provisions of the Work Safety Law of the People’ s Republic of
China , Huatai Mining was fined RMB650,000 and Hanfeng Mining was fined
RMB350,000, both falling within the penalty range for a general accident;
(iv) the Certificate of Compliance issued by the Chifeng Songshan District Emergency
Management Bureau on October 24, 2024 stated that Huatai Mining had not violated
relevant laws, regulations, regulatory documents, or other relevant provisions of the
production safety management that would result in major administrative penalties;
and
(v) the Certificate of Compliance issued by the Longjing City Emergency Management
Bureau on October 15, 2024 stated that Hanfeng Mining had not violated relevant
laws, regulations, regulatory documents, or other relevant provisions of the
production safety management that would result in major administrative penalties.
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Work-related Injuries
During the Track Record Period and up to the Latest Practicable Date, LXML had several
work-related injuries: (a) a cleaner suffered a swelling ankle injury due to her health issues, (b)
a mechanic suffered a minor fracture and small cut to his left index finger due to his team’s
operational error, (c) a driver of a dump truck suffered an open fracture to his left wrist and
left knee when his vehicle collided with an oncoming bus operated by a contractor’s driver who
was found intoxicated, (d) a technician suffered fracture injury to his right foot when removing
a cover plate as the plate was improperly supported and fell on his foot due to his operational
error, and (e) a drill assistant suffered a fractured thumb bone after losing his balance and
falling to the ground while moving a base log due to his operational error.
All the aforementioned injured workers received timely treatment arranged by LXML and
returned to their posts upon recovery. The compensation resulting from the work-related
injuries was either fully covered by our insurance or paid by us after insurance payout. The
injured workers did not file any claims or lawsuits against LXML in connection with their
injuries. LXML did not receive any administrative penalty in this regard. Although these
injuries resulted in loss of the working hours of the injured workers, they did not cause any
suspension of production or have any material adverse impact on our operations. We conducted
thorough investigations on the aforementioned instances, and prepared accident reports. We
have established a strict monitoring system based on five major indicators of work safety,
namely occupational health, environmental protection incidents, fire accidents, and major
infrastructure accidents. We then modified our work equipment to meet greater safety
standards, improved safety training for employees at all levels participating in various work
streams, and rectified internal control deficiencies identified in the accident reports.
Additionally, we tightened contractor management and reassessed our collaboration with
certain contractors. We have updated our contractor policy, developed and reviewed related
Standard Operating Procedures to distribute to relevant employees and contractors, and
conducted regular training to enhance safety management of contractors. As per the internal
control request of the PRC headquarters, both LXML and its contractors are managed through
the unified responsibility system. If a contractor fails to meet our safety production standards
during our evaluation of its qualification, we shall request the contractor to rectify or we may
consider terminating our cooperation with the contractor. The enhanced internal control
measures were reviewed by our internal control consultant and no material deficiency was
identified.
As LXML has not received any enquiry or administrative complaint or penalty from
relevant authorities regarding these work-related injuries, our Laos Legal Advisor is of the
view that such injuries were not serious injuries and would not have any material adverse
impact on LXML’s business operation or financial performance.
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Project Management Deficiency
On June 14 and 16, 2022, during the supervisory inspection of Hanfeng Mining by the
Jilin Bureau of the National Mine Safety Inspection, the third enforcement team of the Jilin
Bureau and the administrative law enforcement personnel of the Longjing City Emergency
Management Bureau identified certain deficiencies in the Group’s mining monitoring and
reporting system, including, among others, lack of records of project leaders taking shifts
underground for shift changes. On July 1, 2022, the Longjing City Emergency Management
Bureau imposed an administrative fine of RMB70,000 on Hanfeng Mining. Hanfeng Mining
paid the fine on July 6, 2022, and completed rectification. On October 24, 2022, the Longjing
City Emergency Management Bureau issued a certificate, determining that the aforementioned
deficiencies are immaterial non-compliance and do not constitute material one.
Hanfeng Mining enhanced its internal control measures on project management including
adopting an internal control policy formalizing work shifts and handover arrangements among
leaders for underground work. The enhanced internal control measures were reviewed by our
internal control consultant and no material deficiency was identified.
Our PRC Legal Advisor is of the view that this incident does not constitute a material
non-compliance under relevant laws and regulations.
Having considered the following factors, nothing has come to our Directors’ attention that
would cause them to believe that they are not suitable to act as Directors under Rule 3.08 and
3.09 of the Listing Rules:
 as advised by our PRC Legal Advisor, neither of the fatal accidents above constitutes
a material safety production accident nor has any material adverse impact on the
Group’s business operations or financial condition;
 as advised by our PRC Legal Advisor, the deficiencies in project management
system does not constitute a material non-compliance under relevant laws and
regulations;
 as advised by our Laos Legal Advisor, the work-related injuries which occurred in
Laos do not constitute material safety production issues as LXML has not received
any enquiry or administrative complaint or penalty from relevant authorities
regarding these work-related injuries, and such injuries were not serious injuries;
 no monetary fine or other penalty was imposed directly from any competent
authorities in PRC or Laos to any of our Directors;
 there has not been any occurrence of other similar events in our Group; and
BUSINESS
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 our Directors received directors’ training from our Hong Kong legal advisor and
they have confirmed that they fully understand their obligations as directors of a
company listed on the Hong Kong Stock Exchange, in particular the directors’
fiduciary duties and the relevant disclosure requirements under the Listing Rules.
Based on the due diligence conducted by the Sole Sponsor including but not limited to (i)
review of results of litigation searches and background searches, (ii) attending physical site
visits in Laos to understand, among others, the operations and reserves of mines and retrieved
documents onsite as supporting documents for interviews, and (iii) conducting interviews with
our Directors to understand the qualification and independence of our Directors, the Sole
Sponsor concurs with the aforementioned views of our Directors.
For relevant risks relating to our occupational health and safety practice, see “Risk
Factors — Risks Relating to Our Business and Industry — Our business is subject to a number
of operational risks and hazards specific to mining industry, which may result in increased
costs or losses, personal injuries or casualties, damage to reputation, suspension of operation
and other penalties.”
Potential ESG-Related Risks and Our Strategies
Our mining activities and production processes pose potential ESG-related risks such as
gas emission, wastewater, noise, solid waste, tailings management, and land remediation and
biodiversity risks. To mitigate the adverse impact of these risks, we have taken the following
measures:
 Gas emission — strengthen the supervision of gas emissions at all stages of
production and take various measures on-site to reduce emissions, such as greening,
water sprinkling, and installing dust removal devices;
 Wastewater — enhance wastewater management measures. Wastewater emission
will only be allowed if it meets the environmental protection standards. Moreover,
we improve the wastewater utilisation system to achieve internal water resource
recycling within the mine;
 Noise — purchase and use equipment and noise reduction technologies that could
reduce the overall noise levels, equip relevant technical personnel with necessary
noise reduction gear and conduct regular inspections of noise generation;
 Solid waste — implement waste sorting management, requiring all departments and
individuals to discard different types of solid waste at designated locations, which
are then cleaned up and sealed for transportation by third-party professionals. At the
same time, to reduce the pollution and danger of solid waste, we strive to recycle
treated waste again in the production process;
BUSINESS
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 Tailing management — strictly adhere to international standards for tailings
management and take various measures to properly handle tailings residues, such as
striving for dry tailings disposal, using impermeable membranes, and improving ore
dressing reagents, to avoid potential hazards to the surrounding ecological
environment and communities. We also regularly conduct strict inspections and
supervision of the safety, environmental protection, and anti-seepage aspects of
tailings dams to ensure that tailings do not collapse, leak liquids, or cause other
major disasters. At the same time, we have established strict disposal processes and
measures for closed tailings, and carried out greening and mountain restoration work
on closed tailings to ensure that the restored tailings do not pose any harm or
negative impact on the environment and surrounding communities;
 Land remediation and biodiversity — rely on the existing site conditions to plan land
use reasonably, striving to preserve the original appearance of the surrounding
mountains during the process of mineral resource extraction. In the construction of
open-pit mines, we will try to avoid soil erosion caused by the construction process
and minimize land occupation. We will strictly design the construction machinery,
operation modes, and construction seasons to reduce soil erosion caused by
construction from entering water bodies. In addition, we strictly require our
employees to prohibit hunting and capturing birds and other wild animals; and
 Local community’ s concerns — engage in regular communication with local
residents in an open and honest manner, listening to the real needs of community
members, and allocate resources to address actual issues. We also focus on the goals
of community co-construction and sustainable development, such as supporting
community projects, and improving road and water and electricity facilities, to
provide a safe and convenient living environment for community residents. For
instance, Wulong Mining collaborates with local governments to plan the
construction of drinking water wells for surrounding communities to address water
scarcity issues.
At the same time, we commit to supporting education, healthcare, and poverty alleviation
projects, as well as public welfare and charitable causes, striving to create positive social
impacts and cultural benefits. It is our policy to follow local legal regulations and industry
standards in carrying out community work under the framework of the “Creating V alue for
Locals” principle. Our goal is to benefit communities in the long term by improving
infrastructure and promoting education and employment, so as to create decent jobs for the
communities where we operate, stimulate local economic development, and benefit society and
the communities surrounding our operations.
As we carry out our mining activities and production processes in Ghana and Laos, we
face specific ESG-related risks such as the risks of resources shortage, illegal mining,
corruption, forest degradation, economic crisis and instability of government, human
trafficking, child labour and labour strikes. To monitor and mitigate relevant risks in these
areas, we have taken the following measures.
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GHANA
Resources shortage risks (electricity, water resources)
 Electricity — to mitigate the potential risks of the electricity shortage, GSWL has
improved the power infrastructure of the Wassa Gold Mine by equipping the mine with
two sources of electricity, one is a natural gas power plant (GP Wassa Plant) which only
supplies the production of the mine, and the other is the Ghana National Grid, which is
taken as a backup power supply. At the same time, GSWL has upgraded the existing
supplier’s power supply system in 2024.
 Water resource — to mitigate the potential risks of the water resources shortage, GSWL
has already increased the capacity of water resource storage facilities and strengthened
water resource management.
Illegal Mining risks
During the Track Record Period and up to the Latest Practicable Date, though there were
some illegal surface mining incidents in the exploration rights area, the illegal miners caused
minor damages to office facilities and disruptions to operations for one to two days. There was
no armed confrontation against the illegal miners, and none of GSWL’s mining areas in Ghana
has experienced any material disruption to its operations and production due to illegal mining.
To monitor and mitigate the potential risks of the illegal mining, GSWL has implemented a
series of measures to address illegal mining risk, including working closely with local police
and engaging third-party security companies to closely monitor illegal mining activities and
drive away offenders. For instance, GSWL has established patrol system to conduct regular
inspection and installed surveillance cameras to monitor surroundings in real-time.
Corruption risks
According to Frost & Sullivan, Ghana’s rankings in the corruption perceptions index were
70th, among all 180 tracked countries in 2023 based on Transparency International Corruption
Index. Currently, there are no international sanctions in force against Ghana. GSWL has strict
internal systems and regulations, and both GSWL and its suppliers and contractors have signed
anti- corruption commitments.
Forest degradation risk
GSWL only has the southern extension of the Wassa Gold Mine in the forest area, where
the resources are located more than 500 meters below the ground. The underground mining
method is adopted to ensure lower forest degradation risks towards the surface. In addition, any
operation of GSWL in the forest area requires approval from the Forestry Commission of
Ghana, which issues operation permits after assessing the impact. GSWL has obtained the
operation permits for the southern extension of Wassa Gold Mine.
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LAOS
Corruption risks
According to Frost & Sullivan, Laos’ rankings in the corruption perceptions index were
136th among all 180 tracked countries in 2023 based on Transparency International Corruption
Index. Currently, there are no international sanctions in force against Laos, and therefore Laos
is not considered to be at high risk for sanctions. LXML has established an internal
“Anti-Corruption and Bribery Policy ”( “ Policy ”) to stipulate the rules and regulations that
employees must follow in the practice of anti-corruption. In addition, for key high-risk core
positions, LXML has implemented a multi-dimensional conflict of interest disclosure
mechanism to ensure the comprehensive and accurate disclosure and understanding of potential
conflicts of interest, thereby reducing the risk of corruption. LXML has designated detailed
anti-corruption training sessions for different positions to enhance employees’ awareness of
interests of conflicts and compliance practices. Any violations discovered will be dealt with
according to the Policy, with severe cases potentially facing local criminal penalties.
Economic crisis and instability of the government risks
Historically, Laos experienced economic crisis and government instability. To monitor
and mitigate the potential economic crisis and instability of the government risks, LXML
mainly operates in Laos according to its investment strategies focusing on the Belt and Road
Initiative countries. By entering into the MEPA agreement with the Lao government, LXML
has secured certain level of protection for its operation in Laos.
Our internal control consultant conducted due diligence review of our internal control
measures and policies, risk management systems and reporting procedures in addressing the
aforementioned ESG risks in Laos and Ghana, and did not identify any material deficiency.
SEASONALITY
Our Directors considered that, and as confirmed by Frost & Sullivan, our gold mining and
other mineral businesses are generally subject to any seasonal fluctuations. Based on our past
practice, it is possible that our operation would be impacted by the rainy season. During the
rainy season, which generally occurs in the third quarter of the year, the continuous rainfall
would block our heavy machinery and equipment from accessing our orebodies. Moreover, our
regular maintenance sessions are usually scheduled around the holidays, which might lead
slight fluctuation in our production volume.
EFFECTS OF THE COVID-19 OUTBREAK
In 2020, outbreak of the COVID-19 in the PRC and around the globe led to an
international public health crisis and, as a result, the global economy in general were materially
and adversely affected. Due to the imposition of strict travel restrictions and controls in major
cities to combat the transmission of the COVID-19, there was a significant decrease in
international commercial activities and business transactions.
BUSINESS
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Given this unprecedented global health crisis, our Group’s business operations were
briefly impacted by the outbreak in early 2020 due to social and work gatherings, mandatory
quarantine requirements and suspended public transportation in certain areas in China, Laos
and Ghana. As some of our Group’s employees had to work from home, the operations that
required onsite service were be interrupted to a limited extent. However, we resumed normal
business operations after the initial disruptions in early 2020. In addition, China experienced
widespread COVID-19 resurgence in late 2022 and early 2023, but the emergency measures
taken by the Chinese government quickly brought the situation under control. Despite the
significance of the pandemic, COVID-19 did not have any material adverse impact on our
business operation or key operating performance during the Track Record Period and up to the
Latest Practicable Date.
INSURANCE
We carry insurance covering risks in relation to safety production obligations. We also
carry insurance for loss of and damages to our various machinery, equipment and inventories.
In addition, we maintain social insurance for our PRC employees, which includes work
accident insurance. We also maintain additional accident insurance for our employees engaged
in mining activities. In line with industry practice, we generally do not carry any business
interruptions or litigation insurance. We consider our insurance coverage to be adequate for the
needs of our business operations and in line with the industry norm and the relevant laws and
regulations in the PRC. In Laos and Ghana, we maintain insurance in accordance with the laws
and regulations of Laos and Ghana, respectively. For instance, the tailings facility of the Wassa
Gold Mine is insured as part of our property all risk, machinery breakdown and business
interruption insurance. Save for the compensation in an aggregate amount of RMB1.3 million
relating to the fatal accidents in the PRC during the Track Record Period, which were beyond
the coverage of our insurance, we believe our insurance coverage is sufficient for the monetary
expenditures arising from the incidents mentioned in the sub-sections headed “Occupational
health and safety” and “Licenses and Permits” of this section. We believe these incidents are
isolated cases and we have sufficient working capital to cover any potential compensation
arising from such type of incidents.
During the Track Record Period and up to the Latest Practicable Date, we did not make
any material insurance claims in relation to our business. However, should any significant
uninsured damages to any of our properties, inventories or other assets or liabilities claims
against us occur, our business, financial condition and results of operations may be adversely
affected. For details, see “Risk Factors — Risks relating to Our Business and Industry — Our
insurance coverage may be inadequate to satisfy potential claims and fluctuations in insurance
cost and availability could adversely affect our business, financial condition and results of
operations.”
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PROPERTIES
Our headquarters is located at No. 7, Xiaojingjia, Wanfeng Road, Fengtai District, Beijing
(̏ԯ̹ᔮ̨ਜຬᔮ༩ʃʜ͠ɖ໮). As of the Latest Practicable Date, our various businesses in
the PRC were located in Inner Mongolia Autonomous Region, Liaoning Province, Jilin
Province, Y unnan Province, Anhui Province, Shanghai and Hong Kong. As of the same date,
we also held properties located in Laos and in Ghana.
As of September 30, 2024, none of the properties held or leased by us had a carrying
amount of 15% or more of our consolidated total assets. Therefore, according to Chapter 5 of
the Listing Rules and section 6(2) of the Companies (Exemption of Companies and
Prospectuses from Compliance with Provisions) Notice (Cap. 32L of the Laws of Hong Kong),
this document is exempted from compliance with the requirements of section 342(1)(b) of the
Companies (Winding Up and Miscellaneous Provisions) Ordinance in relation to paragraph
34(2) of the Third Schedule to the Companies (Winding Up and Miscellaneous Provisions)
Ordinance which requires a valuation report with respect to all our interests in land or
buildings.
As of the Latest Practicable Date, we did not have title certificates for certain of our
owned properties and have not completed registration of leases for certain of our leased
properties. For details of the relevant risks, see “Risk Factors — Risks Relating to Our
Business and Industry — We have not obtained title certificates for some of our properties and
have not completed registration procedures for some of our leased properties, which could
materially and adversely affect our right to use such properties.”
PRC Properties
We own and lease properties in the PRC for mining, industrial, business and office
purposes. As of the Latest Practicable Date, (i) we owned 52 parcels of land with an aggregate
site area of approximately 1,561,439.4 m
2; (ii) we leased 10 parcels of land with an aggregate
site area of approximately 803,665.5 m 2; (iii) we owned 252 buildings with an aggregate gross
floor area of 161,080.7 m 2; (iv) we leased two buildings with an aggregate gross floor area of
2,416.3 m 2; and (v) we leased 26 working seats.
Properties Located in Laos
We lease properties in Laos for mining, processing and support purposes. We have entered
into commercial leasing agreements for our offices. Moreover, we lease other buildings,
primary transportation equipment, machineries and other assets for our mining operations in
Laos. We did not hold any land use right certificate over land in Laos as of the Latest
Practicable Date.
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Properties Located in Ghana
We own and lease properties in Ghana for mining, business and office purposes. As of the
Latest Practicable Date, (i) we owned 75 parcels of land, with an aggregate gross floor area of
approximately 1,169.22 m
2; and (ii) we leased one parcel of land, with an aggregate gross floor
area of approximately 1,708 m 2.
LICENSES AND PERMITS
The following table sets forth information regarding our relevant mining licenses and
exploration permits as of the Latest Practicable Date:
Wulong Mining
Type Serial Number
Permitted
annual
production
volume
(10,000 tons)
Geographical
Area (km 2) Effective Period Status
Mining license /H1118/H1118/H1118/H1118C2100002011084140116558 10 6.2732 December 4, 2020 to
August 4, 2035
V alid
Exploration Permit /H1118/H1118T2100002008044010006347 – 3.88 November 20, 2024 to
November 20, 2029
V alid
Exploration Permit /H1118/H1118T2100002008044010005662 – 0.6112 June 2, 2023 to
June 2, 2028
V alid
Jilong Mining
Type Serial Number
Permitted
annual
production
volume
(10,000 tons)
Geographical
Area (km 2) Effective Period Status
Mining License /H1118/H1118/H1118/H1118C1500002009114120054250 18 8.61 May 1, 2024 to
September 26, 2026
V alid
Mining License /H1118/H1118/H1118/H1118C1500002023124210156146 6 9.1340 December 27, 2023 to
March 27, 2032
V alid
Exploration Permit /H1118/H1118T1500002008044010006035 – 3.83 March 25, 2021 to
March 24, 2026
V alid
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Huatai Mining
Type Serial Number
Permitted
annual
production
volume
(10,000 tons)
Geographical
Area (km 2) Effective Period Status
Mining License /H1118/H1118/H1118/H1118C1500002009064120021513 6 2.7978 June 6, 2024 to
June 5, 2044
V alid
Mining License /H1118/H1118/H1118/H1118C1500002011014140119663 6 0.8138 September 15, 2024
to September 14,
2027
V alid
Mining License /H1118/H1118/H1118/H1118C1500002013094210131353 6 1.0164 March 11, 2024 to
September 5, 2025
V alid
Mining License /H1118/H1118/H1118/H1118C1500002015114210140450 3 1.8332 November 17, 2015 to
November 17, 2025
V alid
Mining License /H1118/H1118/H1118/H1118C1500002015114210140451 3 0.3199 November 18, 2024 to
November 17, 2025
V alid
Mining License /H1118/H1118/H1118/H1118C1500002015114210140449 3 3.7362 November 18, 2023 to
November 17, 2025
V alid
Jintai Mining
Type Serial Number
Permitted
annual
production
volume
(10,000 tons)
Geographical
Area (km 2) Effective Period Status
Mining license /H1118/H1118/H1118/H1118C5300002012054110124688 14 1.0920 June 7, 2022 to
June 6, 2032
V alid
Exploration Permit /H1118/H1118T5300002009034010026977 – 10.28 June 3, 2021 to
June 3, 2026
V alid
Hanfeng Mining
Type Serial Number
Permitted
annual
production
volume
(10,000 tons)
Geographical
Area (km 2) Effective Period Status
Mining license /H1118/H1118/H1118/H1118C2224002021083210152512 60 2.2250 August 27, 2021 to
August 27, 2050
V alid
Mining license /H1118/H1118/H1118/H1118C2200002010123120093830 9.9 2.4207 February 25, 2025 to
February 24, 2030
V alid
Exploration Permit /H1118/H1118T100000202103302800361 – 2.3191 December 20, 2020 to
December 20, 2025
V alid
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LXML
Type Serial Number
Permitted
annual
production
volume
(10,000 tons)
Geographical
Area (km 2) Effective Period Status
Mining License /H1118/H1118/H1118/H1118No. 45-24/MEM.MMD – 130.88 September 30, 2023
to September 29,
2033
V alid
Exploration Permit /H1118/H1118No. 1466/MEM. DGM.3 – 1,010.40 June 14, 2023
to June 14, 2026
V alid
GSWL
Type Serial Number
Permitted
annual
production
volume
(10,000 tons)
Geographical
Area (km 2) Effective Period Status
Mining Lease /H1118/H1118/H1118/H1118/H1118LVDGAST35364682022 – 63.00 January 26, 2022
to January 25, 2047
Lease
renewed
and in the
process of
ratification.
Mining Lease /H1118/H1118/H1118/H1118/H1118LVDGAST37993462020 – 19.45 August 25, 2020
to August 24, 2031
V alid
Mining Lease /H1118/H1118/H1118/H1118/H1118LVDGAST38000372020 – 43.00 August 25, 2020
to August 24, 2031
V alid
Exploration Permit /H1118/H1118LVB9113/1994 & PL 2/155 – 24.81 December 13, 2024 to
December 12, 2027
V alid
Exploration Permit /H1118/H1118LVB5528/2005 & PL 2/378 – 96.44 March 4, 2022 to
March 3, 2025
1
V alid
Exploration
(prospecting)
Permit /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
LVB1624/2006 & RL2/117 – 26.9 September 4, 2024 to
September 3, 2027
V alid
Note:
1. We will submit our renewal application prior to the expiry date in accordance with the relevant laws and
regulations, and we and our Ghana Legal Advisor do not expect any legal impediment in the renewal process
for this permit.
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In addition to mining and exploration permits, we are required to obtain various licenses,
permits and certifications for our operations in the PRC, Laos and Ghana. For example, our
PRC operations require, among others, work safety permit, pollution discharge permit,
explosives operation license, hazardous waste operation license and forest land use permit. Our
Laos operations require, among others, gold-copper ore processing plant business license and
special radio equipment use license. Our Ghana operations require, among others, forest entry
permit, fire certificates, water use permit, explosives permit and environmental certificate.
Failure to obtain approvals for environmental impact assessment filings
Wulong Mining was fined RMB72,137 in 2021 and commanded to halt the construction
of one of the production facilities immediately by the Zhen’an Branch of the Dandong
Municipal Ecology and Environmental Bureau for the failure to obtain approval for
environmental impact assessment filing in accordance with the law and the commencement of
the construction without authorization. Wulong Mining paid the fine on September 18, 2021
and completed rectification as required. The Zhen’an Branch of the Dandong Municipal
Ecology and Environment Bureau issued a special explanation on February 21, 2023, stating
that this incident is deemed as an immaterial non-compliance of the relevant regulation, rather
than a material non-compliance. Therefore, the PRC Legal Advisor is of the view that the
aforementioned non-compliance incident does not constitute a material non-compliance.
Subsequent to this incident, we have halted and gradually phased out the production from this
facility.
We are in the process of obtaining one environmental impact assessment approval for
another project under construction of Wulong Mining from the relevant environmental
protection department. As advised by our PRC Legal Advisor, the risk of our Group being
subject to material administrative penalty for this incident is remote on the following bases: (i)
the Certificate of Compliance (“ Zhen’an Certificate ”) issued by the Zhen’an Branch of the
Dandong Municipal Ecology and Environment Bureau (the “ Zhen’an Bureau ”) on October 10,
2024 states that Wulong Mining’s various ecological environment protection and prevention
measures complied with the relevant standards, and no safety production accidents or
emergency environmental incidents occurred thereof during the period from January 1, 2021 to
the date of the Zhen’an Certificate; (ii) the PRC Legal Advisor conducted an interview with the
staff in charge of the Zhen’an Bureau. The Zhen’an Bureau confirmed that except for the
aforementioned administrative penalty in 2021, there has been no major environmental
pollution accidents or violation of the relevant regulations of the environmental protection, nor
any governmental investigation or administrative penalties upon Wulong Mining; and (iii) the
Zhen’an District People’s Government of Dandong City issued a special explanatory note on
July 8, 2024, which states that there are no substantial obstacles for Wulong Mining to obtain
environmental assessment approval.
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We have also enhanced relevant internal control measures, including strengthening
management over environmental assessment process, and formulating an internal policy for
construction and infrastructure management, which requires that all construction projects to
obtain all necessary permits and approvals before commencement. We have halted and
gradually phased out the production of the former project and have been actively
communicating with the relevant environmental protection department to obtain the
environmental impact assessment approval for the latter project.
Based on the foregoing, nothing has come to our Directors’ attention that would cause
them to believe that they are not suitable to act as Directors under Rule 3.08 and 3.09 of the
Listing Rules.
Pending applications for certain safety production permits and explosives operation license
that have expired
Two of Huatai Gold Mine’s production safety permits expired on September 23, 2024 and
November 11, 2024, respectively, and one explosives operation license of Huatai Gold Mine
expired on November 12, 2024. Huatai Mining is currently undergoing technical renovation
and will go through safety acceptance procedures after completion of the technical renovation.
We will renew the relevant production safety permits and/or explosives operation license after
completing safety acceptance procedures.
The PRC Legal Advisor is of the view that the outstanding/pending permits or license will
not have any material adverse impact on our Group’s operations or financial condition on the
following:
(i) Huatai Gold Mine has not carried out any operation or production since the
commencement of its technical respective renovation or upon the expiry of its
permits or license;
(ii) in accordance with the relevant regulations, for projects involving new construction,
renovation, or expansion, a company is required to conduct production safety
assessment in compliance with the regulations. The production safety permits will
only be issued once the safety facilities have passed the production safety
assessment; and
(iii) a company can only obtain the explosives operation license after completing the
production safety acceptance procedures and obtaining the production safety permit.
Huatai Gold Mine has been undergoing technical renovation, will go through safety
acceptance procedures after the completion of the technical renovation and has not
yet obtained production safety permit, thus not being able to obtain explosives
operation license at this stage.
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Pending approval for updated environmental and social assessment and environmental and
social management and monitoring plan in Laos
As LXML plans to carry out exploration of the Far West mine of the Sepon Gold and
Copper mine, in accordance with Laos environmental laws, we have submitted an updated
environmental and social impact assessment and an environmental and social management and
monitoring plan to the Laotian Government for the expanded project scope at our mines in
Laos, which is pending review by the Laotian Government. The Laos Legal Advisor is of the
view that we are not subject to any legal impediment in obtaining the approval for the updated
environmental and social impact assessment and environmental and social management and
monitoring plan, and the consultation and comments from the Laotian Government regarding
the updated plan are in line with the approval procedure under Lao regulations. According to
the Laos Legal Advisor, the approval thereof is mainly subject to LXML satisfactorily
addressing such consultation and comments from the Laotian Government. LXML has not
encountered any material issue in addressing the Laotian Government’s comments. LXML
received enquiries from ESIA (Environment and Social Impact Assessment) on September 25,
2024 and all enquiries raised have been addressed by November 5, 2024. Based on the above,
the Directors concur with the Laos Legal Advisor’s view that we are not subject to any legal
impediment in obtaining the approval for the updated environmental and social impact
assessment and environmental and social management and monitoring plan. Based on the due
diligence conducted by the Sole Sponsor including but not limited to the legal opinion of our
Laos Legal Advisor and discussion with the legal advisors and management of our Company,
nothing has come to the Sole Sponsor’s attention that would cause the Sole Sponsor to
reasonably doubt the views of our Laos Legal Advisor that there is no anticipation that there
will be any legal impediment for our Group to obtain approval from the Laotian Government
for the updated environmental and social impact assessment and environmental and social
management and monitoring plan.
In addition, the pending environmental and social impact assessment relates only to the
Far West mine whilst the rest of the Sepon Gold and Copper Mine remains valid. LXML
received Laotian Government’s approval to expand its existing mining license to include Far
West region on March 13, 2024, allowing it to proceed with the application of environmental
and social impact assessment in parallel. According to the Laos Legal Advisor, this process can
take up to 18 months, but the operation of the mine would not be materially affected, as the
Laotian authorities have issued the Environmental Certificate No. 0072/MONRE.ED dated
January 8, 2024 for the Sepon gold-copper project.
As advised by our legal advisors in the relevant jurisdictions, during the Track Record
Period and as of the Latest Practicable Date, we believe that we have obtained the requisite
licenses, permits and certificates required by the relevant laws and regulations for our current
operations in all material aspects.
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For more details, please see “— Our Gold Production Business in China — Mining
Licenses and Exploration Permits”, “— Our Gold Production Business in Laos — Mining
Licenses and Exploration Permits”, “— Our Gold Production Business in Ghana — Mining
Licenses and Exploration Permits”, “— Our Other Metal Production Business — Our Other
Mineral Resources Business in China — Mining Licenses and Exploration Permits”, and “—
Our Other Mineral Resources Business — Our Copper Cathodes Business in Laos — Mining
Licenses and Exploration Permits.”
LEGAL PROCEEDINGS AND NON-COMPLIANCES
Legal Proceedings
During the Track Record Period and up to the Latest Practicable Date, we had not been
a party to, and were not aware of any threat of, any material legal, arbitral or administrative
proceeding which, in our opinion, would likely have a material and adverse effect on our
business, financial condition or results of operations. We may from time to time become a party
to various legal, arbitral or administrative proceedings arising in the ordinary course of our
business.
Legal Compliance
We primarily operate in China, Laos and Ghana and our business is regulated and
supervised under different regulatory environments. We are subject to various regulatory
requirements and guidelines issued by the regulatory authorities in the jurisdictions in which
we operate. We aim to monitor regulatory environments and adopt adequate internal procedures
and guidelines to manage our operations in order to avoid potential non-compliance or
misconduct.
During the Track Record Period and up to the Latest Practicable Date, we had not been
and were not involved in any material non-compliance incidents that have led to fines,
enforcement actions or other penalties that could, individually or in the aggregate, have a
material adverse effect on our business, financial condition and results of operations. Our PRC
Legal Advisor advised that we have complied with the relevant PRC laws and regulations in
all material respects. Our Laos Legal Advisor advised us that we have complied with the
relevant Laos laws and regulations in all material respects. Our Ghana Legal Advisor has
advised us that we have complied with the relevant Ghana laws and regulations in all material
respects.
RISK MANAGEMENT AND INTERNAL CONTROL MEASURES
We are subject to various risks relating to our operations, please see “Risk Factors —
Risks Relating to Our Business and Industry — Our risk management and internal control
systems may not fully protect us against various risks inherent in our business” for details.
BUSINESS
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As a joint stock company incorporated in the PRC with our A shares listed on the
Shanghai Stock Exchange and regulated by the CSRC, which is a full signatory to the IOSCO
MMOU. We maintain a centralized management and control in the PRC. The decision-making
processes, and the coordination and management of the implementation of the corporate
matters are conducted by our Directors and management team from its PRC headquarters. The
business activities of our Group’s subsidiaries in the PRC, Laos and Ghana are managed,
monitored, and approved/disapproved by our Company from its PRC headquarters. Through
our Group’s centralized management system, and through the Pronto platform, our Directors
and senior management have, and are expected to continue to have, full and timely access to
books and records regarding our Group’s operations outside of the PRC. The principal books
and records of our Company are also located and maintained in the PRC. The audit department
of the PRC headquarters regularly carry out internal audits work for all of our overseas
operations.
As we operate in the PRC, Laos and Ghana, it is of high importance that we maintain
oversight of the management of our overseas mines. We achieve effective management of our
overseas mine through the following means:
 senior management and key financial personnel are assigned to each of the overseas
mines based on the decisions of the PRC headquarters;
 prior to implementation, the overseas mines must report the important issues, such
as significant personnel appointments and terminations as well as material purchase
and sale contracts, to the PRC headquarters for review and approval before taking
any action of implementation;
 the finance department of PRC headquarters works closely with local finance teams
of the overseas mines to ensure the consistency and propriety in financial reporting,
control, and management. In Laos, the key personnel and the key members of the
finance department are directly assigned by the PRC headquarters;
 each overseas mine reports to the PRC headquarters on various operational,
financial, HR, and ESG matters from time to time. Through the Pronto platform, the
PRC headquarters can also obtain real-time information on the overseas mines; and
 senior management of the PRC headquarters conducts the on-site visit one or two
times per year to the overseas mines to have a comprehensive understanding of the
actual and latest conditions.
Even though Laos has been proactively applied to become an associate member of the
IOSCO, currently it is still not a member of IOSCO or a signatory to the IOSCO MMOU, which
may present certain difficulties for the Hong Kong regulators to seek regulatory assistance and
information from the statutory securities regulator in Laos on a readily available base. We
BUSINESS
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would spare no effort in taking actions in order to mitigate such enforcement risk so that the
Hong Kong regulators can obtain information as to our operations in Laos as and when
necessary and in a timely manner.
Please see “Risk Factors — Risks Relating to Our Business and Industry — It may be
difficult for the Hong Kong regulators to obtain information or call for regulatory assistance
in Laos where circumstances necessitate in the course of overseeing us as a listed company by
the regulations in Hong Kong” and “Directors, Supervisors and Senior Management —
Corporate Governance” for details.
Our management has designed and implemented risk management policies to address
various potential risks we have identified in relation to our operations, including financial risks
and corporate governance risks. Our risk management policy sets forth procedures to identify,
analyze, mitigate and monitor the relevant risks. We are dedicated to establishing a
comprehensive risk management system which operates effectively and is suitable for our
long-term business development.
In addition, we have adopted internal control policies and procedures and we plan to
continuously monitor and improve our management procedures to ensure the effective
operation of those internal controls are in line with the growth of our business and good
corporate governance practice. In order to continuously improve the standards of our internal
control, we have adopted the following measures:
(i) we have engaged external legal advisors to provide timely legal advice to our Board
and other relevant personnel on the applicable laws, rules and regulations
concerning our operations;
(ii) we have appointed four independent Directors to provide independent view,
monitoring and advice to our Group;
(iii) our independent Directors continuously provide an independent review of the
effectiveness of the financial reporting process, internal control and risk
management system of our Group and oversee the audit process and performs other
duties and responsibilities as assigned by the Board; and
(iv) our Directors have attended, and will continue to undertake, relevant training
conducted by our legal advisors on the ongoing obligations, duties and
responsibilities of directors of publicly listed companies under applicable laws and
regulations.
Our Directors are of the view that we have taken all reasonable steps to establish a proper
internal control system. As such, our Directors are of the view, that our internal control
measures are adequate and effective.
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OUR SINGLE LARGEST SHAREHOLDER GROUP
As of the Latest Practicable Date, Ms. Li and Hanfeng Zhongxing directly held
190,410,595 and 51,515,151 A Shares, accounting for approximately 11.44% and 3.10% of the
issued share capital of our Company, respectively. Meanwhile, Ms. Li is the sole limited
partner of Hanfeng Zhongxing accounting for approximately 99.00% of the committed capital
contribution of Hanfeng Zhongxing and Mr. Wu Zengxiang, the general partner, accounting for
the remaining 1.00% of the committed capital contribution. Mr. Wu has approximately 30 years
of experience in the securities and investment management industry and became the general
partner of Hanfeng Zhongxing in August 2023. Pursuant to the Hong Kong Listing Rules and
Chapter 1.1C of the Guide, Ms. Li and Hanfeng Zhongxing are regarded as the Single Largest
Shareholder Group of our Company.
Mr. Wu is not considered to be part of the Single Largest Shareholder Group because
despite his role as a general partner, in accordance with the partnership agreement of Hanfeng
Zhongxing, the partners meeting comprising all the partners is regarded as the highest authority
within the limited partnership. Essentially all the operational matters and internal management
of Hanfeng Zhongxing, including change of the name and term of the partnership, composition
of general and limited partners, transfer and/or pledge of committed capital contribution,
provision of external guarantee, borrowing and financing matters, acquisition and disposal of
assets and investments, amendment of the partnership agreement and dissolution of
partnership, shall be resolved at the partners meeting, and the general partner is bound by the
resolutions at the partners meeting to carry out such activities. Given that Ms. Li holds
approximately 99.00% of the committed capital contribution (that is, interest) of Hanfeng
Zhongxing, Ms. Li’s proportion of interest in Hanfeng Zhongxing is in vast contrast with the
remaining approximately 1.00% of the interest held by Mr. Wu. Meanwhile, essentially all of
the material operations and management of Hanfeng Zhongxing rest with the partners meeting.
The limited partnership agreement of Hanfeng Zhongxing expressly mandated that the role of
the general partner is to execute the operational matters of Hanfeng Zhongxing in accordance
with the limited partnership agreement or upon authorization of the partner(s), and to report to
the limited partner(s) on the execution status and the operational and financial conditions of the
partnership. As such, the role of Mr. Wu is to represent Hanfeng Zhongxing in external
business and operational matters upon the authorization of Ms. Li. Mr. Wu does not, and cannot
exercise control over Hanfeng Zhongxing; and taking in account of the above, the majority
interest held by Ms. Li enables her to exercise de facto control of Hanfeng Zhongxing.
Therefore, Mr. Wu has no control over the voting rights in the share capital of our Company
held by Hanfeng Zhongxing, nor the control of Hanfeng Zhongxing in the exercise of such
voting rights. Those are rested solely with Ms. Li.
RELATIONSHIP WITH OUR SINGLE LARGEST SHAREHOLDER GROUP
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Accordingly, the Single Largest Shareholder Group was entitled to exercise voting rights
attached to the 241,925,746 A Shares, representing approximately 14.54% of the total issued
share capital of our Company as of the Latest Practicable Date. Immediately following the
completion of the Global Offering, the Single Largest Shareholder Group will be interested in
approximately 12.94% of our total share capital (assuming the Offer Size Adjustment Option
and the Over-allotment Option are not exercised) or approximately 12.50% of our total share
capital (assuming the Offer Size Adjustment Option and the Over-allotment Option are
exercised in full).
NO COMPETITION AND CLEAR DELINEATION OF BUSINESS
Each member of the Single Largest Shareholder Group confirmed that, as of the Latest
Practicable Date, she/it did not have any interest in any business, other than our business,
which compete, or is likely to compete, either directly or indirectly, with our business and
would require disclosure under Rule 8.10 of the Hong Kong Listing Rules.
INDEPENDENCE FROM OUR SINGLE LARGEST SHAREHOLDER GROUP
Having considered the following factors, our Directors are satisfied that we are capable
of carrying on our business independent from our Single Largest Shareholder Group after
Listing.
Management Independence
Our daily operational and management decisions are made collectively by our executive
Directors and our senior management, with our Board having an overall supervision of our
management. Our Board consists of four executive Directors, one non-executive Director and
four independent non-executive Directors. We believe that our Directors and senior
management can independently perform their duties in our Company and we can operate
independently from our Single Largest Shareholder Group for the following reasons:
 each of our Directors is aware of his/her fiduciary duties as a director of our
Company which requires, among other things, that he/she acts for the benefit and in
the best interests of our Company and does not allow any conflict between his/her
duties as a Director and his/her personal interest;
 in the event that there is a potential conflict of interest arising out of any transaction
to be entered into between our Group and our Single Largest Shareholder Group or
its associates, the interested Director(s), if any, shall abstain from voting at the
relevant Board meetings of our Company in respect of such transactions and shall
not be counted in the quorum;
RELATIONSHIP WITH OUR SINGLE LARGEST SHAREHOLDER GROUP
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 our Board has a balanced composition of executive Directors and independent
non-executive Directors which ensures the independence of our Board in making
decisions affecting our Company. Specifically, (a) our independent non-executive
Directors are not associated with our Single Largest Shareholder Group or its
associates; (b) our independent non-executive Directors account for over one-third
of the Board; and (c) our independent non-executive Directors individually and
collectively possess the requisite knowledge and experience as independent
directors of listed companies and will be able to provide professional and
experienced advice to our Company. Accordingly, our Directors believe that our
independent non-executive Directors are able to bring impartial and sound judgment
to the decision-making process of our Board and protect the interest of our Company
and the Shareholders as a whole;
 we will establish corporate governance measures and adopt sufficient and effective
control mechanisms to manage conflicts of interest, if any, between our Group and
our Single Largest Shareholder Group, which would support our independent
management. See the paragraph headed “— Corporate Governance Measures” in
this section below; and
 Ms. Li has undertaken and confirmed to the Board that she would not participate in
the Board’s affairs or attend to the day-to-day operations of the Group; instead, the
operations of the Group shall continue to be maintained by the management team of
the Company led by Chairman Wang.
Having considered the above factors, our Directors are satisfied that our executive
Directors and senior management are able to perform their managerial roles in our Company
independently, and our Directors are of the view that we are capable of managing our business
independently from our Single Largest Shareholder Group after Listing.
Operational Independence
Our Group holds all the relevant material intellectual property rights, licenses,
qualifications and permits required for conducting our Group’s business. Our Group has
sufficient capital, facilities and employees to operate our business independently from our
Single Largest Shareholder Group and its close associates. We have our own accounting and
financial departments, human resources and administration departments, and procurement,
production and sales departments. We have also established a set of internal control procedures
and adopted corporate governance practices to facilitate the effective operation of our business.
RELATIONSHIP WITH OUR SINGLE LARGEST SHAREHOLDER GROUP
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Our Group currently leases a 2,226 square metre office premises for use as our
headquarters to maintain our daily business operations. The relevant lease and the property
management services pertaining to our use of the headquarters are governed by the Property
Lease Agreements and the Property Management Services Agreement, respectively, entered
into between our Company and Beijing Eagleleap, which is held as to 99% equity interest by
Hanfeng United, and which, in turn, is wholly owned by Ms. Li and thus an associate of Ms.
Li, and constitute connected transactions of our Company. For details of the connected
transactions, see the section headed “Connected Transactions” in this Prospectus.
Our Directors believe that such connected transactions between Beijing Eagleleap and our
Group will not give rise to any business independence or reliance issues due to the following
reasons:
(a) the roles of our Company (as the lessee and the procurer of the Property
Management Services under the Property Lease Agreements and the Property
Management Services Agreement, respectively) and those of Beijing Eagleleap (as
the lessor and the provider of the Property Management Services under the Property
Lease Agreements and the Property Management Services Agreement, respectively)
are complementary and beneficial to each other;
(b) the connected transactions are entered into in the ordinary and usual course of
business of our Group and on an arm’s length basis and on normal commercial
terms. The connected transactions are based on pre-agreed pricing policies which
ensure that the pricing is fair and reasonable, particularly the pricing terms are
determined with reference to, among others, the prevailing market rates;
(c) given Beijing Eagleleap is the landlord of the office premises of our headquarters,
it generally maintains better and more efficient communication and thorough
understanding of the conditions of the Leased Premises and commercial needs of our
Group, as compared to other services providers. Furthermore, any relocation of our
headquarters office premises or change of the current arrangements under the
connected transactions may cause unnecessary disruption to our administration and
incur additional costs. Accordingly, our Directors consider that it would not be
commercial sensible to discontinue the lease and procurement of the Property
Management Services from Beijing Eagleleap; and
(d) the risk of Beijing Eagleleap terminating the connected transactions is remote as the
parties under the Property Lease Agreements and the Property Management Services
Agreement have limited termination rights and the termination would not be in the
commercial interest of Beijing Eagleleap. In the unlikely event that Beijing
Eagleleap ceases to lease the premises and/or provide the Property Management
Services to us, our Directors believe that we will have sufficient time and resources
to locate other comparable premises and/or service providers available in the
market. Therefore, our Directors do not consider that such termination, if any, will
cause a material adverse effect on our business.
RELATIONSHIP WITH OUR SINGLE LARGEST SHAREHOLDER GROUP
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Accordingly, we believe that we are capable of carrying on our business independently of
our Single Largest Shareholder Group and its close associates. Our Directors are of the view
that our Group will be able to operate independently from our Single Largest Shareholder
Group and its close associates after Listing.
Financial Independence
Our Group has an independent financial system. We make financial decisions according
to our own business needs and neither our Single Largest Shareholder Group nor its close
associates may intervene with our use of funds. We have opened accounts with banks
independently and do not share any bank accounts with our Single Largest Shareholder Group
or its close associates. We have established an independent finance department as well as
implemented sound and independent audit, accounting and financial management systems. We
have adequate internal resources and a credit profile to support our daily operations.
As of the Latest Practicable Date, there were no outstanding loans or guarantees provided
by, or granted to, our Single Largest Shareholder Group or its close associates.
Based on the above, we are of the view that there is no financial dependence on our Single
Largest Shareholder Group and its close associates.
CORPORATE GOVERNANCE MEASURES
Our Directors recognize the importance of good corporate governance to protect the
interest of our Shareholders. We would adopt the following corporate governance measures to
manage potential conflict of interests between our Group and our Single Largest Shareholder
Group:
(a) where a general meeting is held for considering proposed transactions in which any
member of our Single Largest Shareholder Group has a material interest, she/it shall
abstain from voting on the relevant resolutions and shall not be counted in the
quorum for the voting;
(b) where a Board meeting is held for the matters in which a Director has a material
interest, such Director shall abstain from voting on the relevant resolutions and shall
not be counted in the quorum for the voting;
(c) in the event that our independent non-executive Directors are requested to review
any conflict of interest between our Group and any member of our Single Largest
Shareholder Group, she/it shall provide the independent non-executive Directors
with all necessary information and our Company shall disclose the decisions of the
independent non-executive Directors either in its annual reports or by way of
announcements;
RELATIONSHIP WITH OUR SINGLE LARGEST SHAREHOLDER GROUP
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(d) our Directors (including our independent non-executive Directors) will seek
independent and professional opinions from external advisors at our Company’s cost
as and when appropriate in accordance with the Corporate Governance Code and
Corporate Governance Report set out in Appendix C1 of the Hong Kong Listing
Rules;
(e) any transactions between our Company and its connected persons shall be in
compliance with the relevant requirements of Chapter 14A of the Hong Kong Listing
Rules, including the announcement, annual reporting and independent Shareholders’
approval requirements (if applicable) under the Hong Kong Listing Rules; and
(f) We have appointed Goldlink Capital (Corporate Finance) Limited as our compliance
advisor, which will provide advice and guidance to us in respect of compliance with
the applicable laws and the Hong Kong Listing Rules, including various
requirements relating to directors’ duties and corporate governance.
Based on above, our Directors are satisfied that sufficient corporate governance measures
have been put in place to manage conflicts of interest between our Group and our Single
Largest Shareholder Group and/or other Directors to protect minority Shareholders’ rights after
the Listing.
RELATIONSHIP WITH OUR SINGLE LARGEST SHAREHOLDER GROUP
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OVERVIEW
Prior to the Listing, our Group has entered into certain transactions with the following
party which will, upon the Listing, become a connected person of our Company. Details of such
one-off connected transactions and continuing connected transaction of our Company
following the Listing are set out below.
RELEV ANT CONNECTED PERSON
Beijing Eagleleap is owned as to 99% equity interest by Hanfeng United, which in turn
is wholly owned by Ms. Li, a member of our Single Largest Shareholder Group. Therefore,
Beijing Eagleleap will become a connected person of our Company upon the Listing pursuant
to Chapter 14A of the Hong Kong Listing Rules.
ONE-OFF CONNECTED TRANSACTIONS
Property Lease Agreements
Description of the Transaction
Principal terms
Our Company entered into the 2022-2024 Property Lease Agreement with Beijing
Eagleleap on January 1, 2022, pursuant to which Beijing Eagleleap agreed to lease to us the
Leased Premises with a total gross floor area of approximately 2,226 square metres located at
A7 Xiaojing, Wanfeng Road, Fengtai District, Beijing, the PRC ( ʕ਷̏ԯ̹ᔮ̨ਜຬᔮ༩ʃ
ʜ͠7໮৫) as the office premises of our headquarters in the PRC for a term of three years from
January 1, 2022 to December 31, 2024. On August 20, 2024, our Company entered into the
2025-2026 Property Lease Agreement with Beijing Eagleleap for the lease of the Leased
Premises for a term of two years from January 1, 2025 to December 31, 2026. Under the
2025-2026 Property Lease Agreement, our Company has the priority right to renew the lease
upon notification of such request to Beijing Eagleleap 60 days prior to the expiry of the lease.
The Property Lease Agreements were entered into (i) in the ordinary and usual course of
business of our Group; (ii) on arm’s length basis; and (iii) on normal commercial terms with
the rent being determined with reference to, among others, the leased area, geographical
location and condition of the Leased Premises and the prevailing market rates for similar
properties in the surrounding area.
CONNECTED TRANSACTIONS
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Under the 2022-2024 Property Lease Agreement, the balance of the lease liabilities, being
the present value of the lease payments recognized by our Group in relation to the Leased
Premises according to IFRS 16 as of September 30, 2024 amounted to approximately RMB2.3
million. For the years ended December 31, 2021, 2022 and 2023 and the nine months ended
September 30, 2024, the value of the right-of-use assets acquired by us from Beijing Eagleleap
were approximately nil, RMB14.0 million, nil and nil, respectively.
Under the 2025-2026 Property Lease Agreement, the balance of the lease liabilities and
the value of the right-of-use assets acquired by us from Beijing Eagleleap according to IFRS
16 as of the date of the agreement amounted to approximately RMB8.0 million, respectively.
Reasons for and benefits of the transaction
We have been using the Leased Premises during the Track Record Period. Any relocation
of our headquarters may cause unnecessary disruption of our administration and incur
additional costs. The continuation of such lease is cost efficient and is beneficial to our
operations.
In light of the above, our Directors are of the view that the transactions under the Property
Lease Agreements are fair and reasonable and in the best interest of our Group and the
Shareholders as a whole.
Hong Kong Listing Rules Implication
In accordance with IFRS 16 “Leases”, our Company recognized a right-of-use asset on its
balance sheet in connection with the lease of the properties from Beijing Eagleleap. Therefore,
the leases of the Leased Premises from Beijing Eagleleap under the Property Lease Agreements
are regarded as acquisitions of capital asset and one-off connected transactions of our Company
for the purposes of the Hong Kong Listing Rules. Accordingly, the reporting, announcement,
annual review and independent Shareholders’ approval requirements in Chapter 14A of the
Hong Kong Listing Rules will not be applicable.
FULLY EXEMPT CONTINUING CONNECTED TRANSACTION
We have entered into the following continuing connected transaction which will be
exempt from the annual review, reporting, announcement and independent Shareholders’
approval requirements under Chapter 14A of the Hong Kong Listing Rules.
CONNECTED TRANSACTIONS
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Property Management Services Agreement
Description of the Transaction
Principal terms
Our Company entered into the Property Management Services Agreement with Beijing
Eagleleap on August 20, 2024, pursuant to which Beijing Eagleleap agreed to provide the
Property Management Services to our Company for our use of the Leased Premises and to
address the daily needs of our employees at the headquarters. The scope of services provided
by Beijing Eagleleap comprise the following:
(i) Property-related services, including provision of utility (electricity), fire safety,
cleaning and security services for the Leased Premises;
(ii) Conference services, including maintaining the conference rooms, reception and
catering services at the conferences of our Company;
(iii) Car leasing, including provision of vehicles available for rental for business use by
our employees; and
(iv) Other supporting services, including provision of staff dormitory, maintaining the
staff canteen and conference meals preparation.
The term of the Property Management Services Agreement is two years from January 1,
2024 to December 31, 2025.
Pricing policy
The pricing of the Property Management Services under the Property Management
Services Agreement shall be determined in accordance with the following principles:
(i) the prescribed price imposed by the national or local price administrative
departments of the PRC (and in relation to the utility (electricity), that is charged in
accordance with the pricing standard for Beijing electricity sales issued by the
Beijing Municipal Commission of Development and Reform (։
ึ) from time to time on its website); or in the absence of which,
(ii) the market price upon negotiation between the parties. In determining the market
price, both parties shall take into consideration, among others, the following key
factors:
(a) the prevailing market price charged by any third party providing a similar
service, after making reference to at least two quotations from Independent
Third Party service providers for similar services; and
CONNECTED TRANSACTIONS
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--- page 452 ---
(b) in case where the same or similar services have been provided by Beijing
Eagleleap to a third party, the minimum quotation offered by Beijing
Eagleleap.
Reasons for and benefits of the transaction
Beijing Eagleleap has been providing the Property Management Services to us as
ancillary services for the office use of the headquarters during the Track Record Period. Any
change of the current arrangement may cause unnecessary disruption of our administration and
incur additional costs. The continuation of such arrangement is cost efficient and is beneficial
to our operations. See also the paragraph headed “— One-off Connected Transaction —
Property Lease Agreements — Reasons for and benefits of the transaction” in this section for
details.
Historical transaction amounts
The following table sets forth the historical transaction amounts incurred by our Company
for the provision of the Property Management Services by Beijing Eagleleap during the Track
Record Period:
Y ear ended December 31,
Nine months ended
September 30,
2021 2022 2023 2024
(RMB)
376,000 908,000 2,147,000 833,000
The increase of transaction amount from approximately RMB0.38 million for the year
ended December 31, 2021 to approximately RMB0.91 million for the year ended December 31,
2022 was mainly attributable to the commencement of procuring the car leasing service from
Beijing Eagleleap during 2022 for our Group’s business travelling purposes. The further
increase of the transaction amount to approximately RMB2.15 million for the year ended
December 31, 2023 was mainly attributable to the procurement of conference and catering
services at our Company’s guest house from Beijing Eagleleap for business development
purposes, as well as the increase in procurement of staff dormitory services in light of our
staff’s needs. The slightly lower transaction amount of approximately RMB0.83 million for the
nine months ended September 30, 2024 when compared to that for the year ended December
31, 2023 was mainly attributable to the decrease in the procurement of staff dormitory and
catering services as certain employees had arranged for their own accommodation and meals
during the period. Further, our Group would usually incur more expenses for utilities
procurement (for instance, heat supply) in the winter season, as well as guest reception services
towards the end of the year.
CONNECTED TRANSACTIONS
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--- page 453 ---
Annual Caps
The following table sets forth the proposed annual caps for the provision of the Property
Management Services:
Y ear ending December 31,
2024 2025
(RMB)
3,000,000 3,000,000
The proposed annual caps were determined based on, among others, (i) the comparable
market prices charged by providers of similar property management services including the
provision for cars for leasing and dormitory; and (ii) the estimated utility (electricity) costs
with reference to the historical volume consumed by us. Our Directors consider that the
aforesaid proposed annual caps are not excessive in light of the expected needs for the Property
Management Services taking into account, among others, the potential expansion of staff force
leading to the corresponding needs of the dormitory and catering services, and the increased
business development and marketing effort to be incurred by our Group necessitating the
increased need for car leasing, conferencing and related guest reception services in the coming
years; meanwhile, over RMB2 million had been incurred for the procurement of the Property
Management Services in 2023.
Directors’ confirmation
Our Directors (including our independent non-executive Directors) are of the view that
(i) the Property Management Services Agreement was entered into in the ordinary and usual
course of business of our Group, on arm’s length basis and on normal commercial terms or
better to us and are fair and reasonable and are in the interest of our Company and the
Shareholders as a whole; and (ii) the proposed annual caps under the Property Management
Services Agreement are fair and reasonable and in the interest of our Company and the
Shareholders as a whole.
Hong Kong Listing Rules Implications
As each of the applicable percentage ratios (other than the profits ratio) is expected to be,
on an annual basis, less than 0.1%, the transaction under the Property Management Services
Agreement is exempt from the annual review, reporting, announcement and independent
Shareholders’ approval requirements under Chapter 14A of the Hong Kong Listing Rules.
CONNECTED TRANSACTIONS
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--- page 454 ---
BOARD OF DIRECTORS
Our Board currently consists of nine Directors, including four Executive Directors, one
Non-executive Director and four Independent Non-executive Directors. The Directors are
appointed for a term of three years and are eligible for re-election upon expiry of their term
in office.
The following table sets out information in respect of the Directors of our Company.
Name Age
Position for the
Current Tenure
Date of
Appointment
as a Director
Date of
Joining Our
Group Roles and Responsibility
Executive Directors
Mr. Wang Jianhua
(ശ) /H1118/H1118/H1118/H1118/H1118/H1118
69 Chairman of the
Board and
Executive
Director
September 17,
2018
September 17,
2018
Overall strategic planning,
business direction and
operational management
of our Group
Ms. Y ang Yi-fang
(˙) (also
known as Lydia
Y ang)/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
48 Executive Director
and Chief
Executive
Officer
July 26, 2022 April 25, 2019 Overall execution of our
development strategy,
daily operation,
business development
and financial
management of our
Group
Mr. Lyu Xiaozhao
(ѐወΊ) (former
name: Lu
Xiaozhao) /H1118/H1118/H1118/H1118/H1118
61 Executive Director,
Vice President
and Chief
Engineer
December 14,
2012
December 14,
2012
Overseeing the
engineering and
technical management
and business
development of our
Group
Mr. Gao Bo (ت)H111856 Executive Director
and Vice
President
December 14,
2012
December 14,
2012
Overseeing the operations
and management of the
Sepon Gold and Copper
Mine
Non-executive Director
Mr. Zhang Xudong
(؇)H1118/H1118/H1118/H1118/H1118/H1118
59 Non-executive
Director
January 4, 2022 February 27,
2020
Providing guidance and
advice to the Board on
the corporate and
business strategies and
strategic investments
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 455 ---
Name Age
Position for the
Current Tenure
Date of
Appointment
as a Director
Date of
Joining Our
Group Roles and Responsibility
Independent Non-executive Directors
Dr. Mao Jingwen
(ˣ౻˖) /H1118/H1118/H1118/H1118/H1118/H1118
68 Independent
Non-executive
Director
January 4, 2022 January 4, 2022 Responsible for
supervising and
providing independent
advice to the Board
Dr. Shen
Zhengchang
(׹݁)H1118/H1118/H1118/H1118/H1118/H1118
64 Independent
Non-executive
Director
January 4, 2022 January 4, 2022 Responsible for
supervising and
providing independent
advice to the Board
Mr. Hu Nailian
(ɗஹ) (former
name:ɗᑌ) /H1118/H1118
69 Independent
Non-executive
Director
January 4, 2022 January 4, 2022 Responsible for
supervising and
providing independent
advice to the Board
Dr. Wong Y et Ping,
Ambrose
(රɓ̻) /H1118/H1118/H1118/H1118/H1118/H1118
45 Independent
Non-executive
Director
August 23,
2024
August 23,
2024
Responsible for
supervising and
providing independent
advice to the Board
DIRECTORS
Executive Directors
Mr. Wang Jianhua (ശ), aged 69, is the Chairman of the Board and Executive
Director of our Company. Chairman Wang is primarily responsible for the overall strategic
planning, business direction, and operational management of our Company. Chairman Wang
joined our Group in September 2018.
Chairman Wang has extensive experience in the mining industry and is one of the first
generation of industry leaders advocating for eco-mining and large-scale mining in the PRC.
Having proactively participated in various roles in the industry throughout his tenure,
Chairman Wang has accumulated the wealth of experience and skills for the overall operational
management and strategic planning to promote the growth of our Company. Upon joining our
Group, Chairman Wang successively held leadership roles as the Director of our Company
from September 2018 to December 2019, Chairman of the Board of our Company since
December 2019, and Chief Executive Officer of our Company from January 2022 to December
2022, respectively. Prior to joining our Group, Chairman Wang served in key roles at numerous
renowned mineral companies. Chairman Wang was the Chairman of the board of directors of
Shandong Gold Group Company Limited (ʮ̡) from February 2006 to
March 2013. Chairman Wang has also been an Executive Director and President of Zijin
Mining Group Company Limited (ʮ̡)( “ Zijin Mining ”), a company
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 456 ---
dually listed on the Main Board of the Hong Kong Stock Exchange (stock code: 2899) and
Shanghai Stock Exchange (stock code: 601899) from October 2013 to December 2016 and
from June 2013 to December 2016, respectively. Chairman Wang also held the position of the
Chairman of Y unan Baiyao Holdings Company Limited (ʮ̡) from April
2017 to May 2018.
Chairman Wang has been a forerunner for his technical achievements within the industry.
In 2010, he brought Shandong Gold Group Company Limited to new heights of achieving an
unprecedented drilling depth of over 4,000 metres within the nation. Further, Chairman Wang’s
vision for overseas expansion is exemplified by Zijin Mining’s successful investment in the
Kamoa-Kakula Copper Mine, a world-class and large-scale stratiform copper deposit in the
Central African Copperbelt region, during his tenure.
Chairman Wang received a Master of Business Administration Degree from Nankai
University in the PRC in December 2005. Chairman Wang also received a Master of Business
Administration Degree from the China Europe International Business School in the PRC in
October 2013. Chairman Wang obtained the qualification of a senior economist in 2001.
Ms. Y ang Yi-fang (˙) (also known as Lydia Y ang), aged 48, is an Executive
Director and the Chief Executive Officer of our Company. Ms. Y ang is mainly responsible for
overall execution of our development strategy, daily operation, business development and
financial management of our Group. Ms. Y ang joined our Group in April 2019.
Ms. Y ang is an entrepreneur who embraces challenges and has nearly 20 years of
experience in the global mining industry. Ms. Y ang’s attention to detail, prowess in skillful
execution and wealth of expertise in strategic planning, corporate development, global mergers
and acquisitions, management of overseas listed corporations and mine projects showcase an
acute ability to generate value-generating solutions. Upon joining our Group, Ms. Y ang has
been serving as a Director of Chijin HK since April 2019. Ms. Y ang also served as the Director
and Chief Executive Officer of our Group from July 2022 and December 2022, respectively.
Prior to joining our Group, Ms. Y ang served as a Deputy General Manager of Gold Mountains
(H.K.) International Mining Company Limited (ʆ(ಥ)ʮ̡) and a Deputy
General Manager of the International Department of Zijin Mining from July 2007 to September
2010. Ms. Y ang first served as the Head of Business Development Department of CST Mining
(“CST Mining ”), a company previously listed on the Main Board of the Hong Kong Stock
Exchange until December 2023 (stock code: 0985) from October 2010 to October 2011. She
served as the Chief Executive Officer of CST Mining since September 2011 and concurrently
served as an Executive Director of the company from October 2011 until her departure in
January 2013. From May 2013 to April 2016, Ms. Y ang served in the management positions in
various companies of Zijin Mining, including as the Chairperson of Xiamen Zijin Tongguan
Investment Development Company Limited (ʮ̡), the Director
and General Manager of Gold Mountains International Mining Company Limited, and the
assistant to the Chairman of Zijin Mining. During June 2018 to April 2020, Ms. Y ang served
as an Executive Director and President at Hengxing Gold Holding Company Limited (ጳර
ʮ̡), a company previously listed on the Main Board of the Hong Kong Stock
Exchange until February 2020 (stock code: 2303) until it was acquired by Shandong Gold for
around HK$3 billion.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 457 ---
Furthermore, Ms. Y ang has significant operational experience from managing mines,
including, for example, mines in the PRC, and CST Mining’s Lady Annie Copper Mine in
Australia and Mina Justa Copper Project in Peru. Aside from her wealth of managerial and
operational experience, Ms. Y ang’s significant international, transactional and capital markets
experience include, for example, being a driving force in a series of major deals while at CST
Mining and Zijin Mining, including CST Mining’s sale of the Mina Justa Copper Project in
Peru for USD505 million to a subsidiary of Minsur S.A. — one of the largest transactions in
that year; Minsur was at the time the world’s fourth largest tin producer and Peru’s largest tin
miner by tonnage.
Ms. Y ang received a Bachelor of Arts degree from Tamkang University in Taiwan in June
2000.
Mr. Lyu Xiaozhao ( ѐወΊ) (former name: Lu Xiaozhao), aged 61, is an Executive
Director, Vice President, and Chief Engineer of our Group. Mr. Lyu is responsible for
overseeing the engineering and technical management and business development of our Group.
Mr. Lyu joined our Group in December 2012.
After successfully leading our Company’s Major Asset Restructuring in 2012, Mr. Lyu
successively served as a Director and General Manager of Jilong Mining from December 2012
to August 2013, the General Manager of our Company from December 2012 to February 2016,
the Chairman of the Board of our Company from February 2016 to December 2019, the Deputy
Chairman of the Board and Chief Executive Officer of our Group from December 2019 to
January 2022 and the Co-chairman of the Board of our Company from January 2022 to
September 2023, respectively. Prior to joining our group, Mr. Lyu successively served as a
Deputy Party Secretary, Executive Director, Deputy General Manager, and a member of the
strategic committee of Lingbao Gold Group Company Limited, a company listed on the Main
Board of the Hong Kong Stock Exchange (stock code: 3330), from September 2002 to March
2011.
Mr. Lyu has since December 2019 served as a Vice President of the China Gold
Association (՘ึ) Vice Director of the Mining Geology Professional Committee of
the Geological Society of China (ึ) since December 2011
and as member of the National Technical Committee on Gold of Standardization
Administration of China (ึ) since May 2008.
Mr. Lyu completed the postgraduate course in political economics (Ӻ
͛) from Shaanxi Normal University (ᇍɽኪ) in the PRC in July 2004 and the course
on Business Management for Executives (फ) from the Tsinghua University
Corporation Cooperation Committee (ึ) in the PRC in September
2003, and a Master of Business Administration Degree from the University of Northern
Virginia in the United States of America in December 2007. Mr. Lyu obtained qualification of
a Senior Mining Engineer from the Sinosteel Corporation in August 2006, a Certified Senior
Consultant from the Association for Science and Technology Consulting of Henan Province (ئ
Ҧፔ༔ุ՘ึ) in June 2005, and a Certified CPM China Professional Manager from the
Human Resources Development Association of China (Ӻึ) in October
2010.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 458 ---
Mr. Gao Bo (ت)aged 56, is an Executive Director and Vice President of our
Company. Mr. Gao is responsible for overseeing the operations and management of the Sepon
Gold and Copper Mine. Mr. Gao joined our Group in December 2012.
Mr. Gao worked as a Director and Deputy General Manager of Jilong Mining from
December 2010 to August 2013. Mr. Gao was a Director and Deputy General Manager of our
Company from December 2012 to February 2016 and served as a Director and General
Manager of our Company from February 2016 to January 2020. Mr. Gao then was a Director
and Executive President of our Company from January 2020 to January 2023, and a Director
and Vice President of our Company from January 2023 onwards.
Mr. Gao received a Bachelor of Business Administration degree in the Northeastern
University (̏ɽኪ) in the PRC by way of online learning in January 2019, and a Master of
Business Administration Degree from the Jilin University (ɽኪ) in the PRC in December
2011. Mr. Gao obtained the qualification of a senior economist from the Bureau of Human
Resources and Social Security of Jilin Province (ღᝂ) in January
2013.
Non-executive Directors
Mr. Zhang Xudong (؇)aged 59, is currently a Non-executive Director of our
Company. Mr. Zhang joined the Board in February 2020 as an Independent Director until
January 2022. Mr. Zhang is mainly responsible for providing guidance and advice to the Board
on the corporate and business strategies and strategic investments.
Mr. Zhang, a distinguished leader with nearly 40 years of experience in the financial
services industry, has served in a series of senior management roles at renowned global
investment firms and listed companies in Hong Kong and other jurisdictions. Illustratively, Mr.
Zhang was Global Partner and Head of Greater China Securities and was a member of the
China Management Committee at Goldman Sachs from September 2009 to December 2012.
Earlier in Mr. Zhang’s illustrious career he was a Private Placement Service Analyst in
New England Mutual Life Insurance Company from October 1990 to June 1994. Subsequently,
from July 1994 to September 1996, Mr. Zhang worked as Vice President of the Corporate
Finance Department of BankBoston N.A. From September 1996 to July 1998, Mr. Zhang
served as Managing Director of the Corporate Finance Department and Chief Financial Officer
of Asia Pacific Region in Koch Industries, Inc. — one of the largest and most prominent private
companies in the United States — where he helped the company expand its operations in Asia
Pacific. From 1999 to 2007, Mr. Zhang was Chairman and CEO of Anjia Group/Shanghai Anjia
Investment Management Co., Ltd, an investment advisory and asset management services firm.
From March 2007 to August 2009, Mr. Zhang served as Managing Director and Head of the
Institutional Client Group, Debt and Equity for China and Head of Global Markets Equity for
China at Deutsche Bank AG, a German multi-national investment bank and financial services
company which is dual-listed on the Frankfurt Stock Exchange (symbol: DBK) and the New
Y ork Stock Exchange (symbol: DB), in Hong Kong. From January 2017 to November 2022,
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 459 ---
Mr. Zhang served as an Independent Director of Ping An Securities Company Limited ( ̻τ
ʮ̡), which is a part of the Ping An Group, a large integrated financial group
in China. Furthermore, since September 2018 Mr. Zhang has been serving as Chairman and
Chief Executive Officer of Hua Kong Tsing Jiao Information Science (Beijing) Company
Limited (Ҧ(̏ԯ)ʮ̡), a data science company established by Tsinghua
University that focuses on the research, development and implementation of data joint
computation security technologies, products and infrastructures based on modern
cryptography.
In addition, Mr. Zhang has served in various positions of trust, including serving on the
Advisory Board of Shanghai Jiao Tong University, Antai College of Economics and
Management, was appointed an Advisor for the China Securities Regulation Committee in
2003, was engaged by China Development Bank as advisor of securitization in the year 2004.
From February 2018 to November 2024, Mr. Zhang served as an Independent Non-
executive Director of Lufax Holding Limited (ʮ̡), which is dual-listed on the
New Y ork Stock Exchange (symbol: LU) and on the Main Board of the Hong Kong Stock
Exchange (stock code: 6623). Lufax Holding Limited is a leading financial service
empowering institution for small and micro businesses in China and is an associate firm of the
Ping An Group.
Mr. Zhang served as an independent non-executive director of Up Energy Development
Group Limited (“ Up Energy ”) from September 2015 to June 2016. Up Energy is a limited
company incorporated in Bermuda and formerly listed on the Stock Exchange (former stock
code: 307) until January 2022. Up Energy together with its subsidiaries was principally
engaged in the mining of coking coal, production and sales of raw coking coal, clean coking
coal, and coking and chemicals products in the PRC. A winding up petition was filed against
Up Energy in Hong Kong and Bermuda in March 2016 and May 2016 for the repayment of
debt. Up Energy was subsequently delisted from the Stock Exchange in January 2022. The
Hong Kong court issued a winding up order against Up Energy in May 2022. Mr. Zhang has
confirmed that (i) he was not involved in the day-to-day management of Up Energy; (ii) there
was no wrongful act on his part leading to the winding up proceedings of Up Energy; and (iii)
he is not aware of any actual or potential claim that has been or would be made against him
as a result of such winding up proceedings.
Mr. Zhang received his Master’s Degree in Community Economic Development from
Southern New Hampshire University (formerly known as New Hampshire College) in
September 1990.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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Independent Non-executive Directors
Dr. Mao Jingwen ( ˣ౻˖), aged 68, has since January 2022 been an Independent
Non-executive Director of our Company responsible for supervising and providing
independent advice to the Board. Since November 2017, Dr. Mao has been an academician at
the Chinese Academy of Engineering ( ʕ਷ʈ೻৫).
Dr. Mao has dedicated his life to the study on mineral deposit model and metallogeny as
well as mineral prospecting. Dr. Mao has made significant contributions to the breakthroughs
in prospecting for concealed orebody in the PRC. Prior to joining our Group, Dr. Mao was the
lecturer at the Department of Geological Exploration of Shanxi Mining Institute from 1978 to
1979. Dr. Mao then served successively as an Assistant Researcher, an Engineer and an
Associate Researcher at the Institute of Mineral Resources under the Chinese Academy of
Geological Sciences (הfrom 1983 to 1992.
Dr. Mao has been serving as a researcher at the Institute of Mineral Resources under the
Chinese Academy of Geological Sciences (הsince December
1992. Dr. Mao is also serving as the Independent Non-executive Director of Shenghe
Resources Holding (ʮ̡), a company listed on the Shanghai Stock
Exchange (stock code: 600392) from April 2019 to December 2023, the Independent
Non-executive Director of CITIC Metal Company Limited (ʮ̡), a
company listed on the Shanghai Stock Exchange (stock code: 601061) since July 2021, and the
Independent Non-executive Director of Zijin Mining Group Company Limited.
Dr. Mao received a Bachelor’s Degree in Mineral Deposits from Hebei GEO University
(̏ήሯኪ৫) in the PRC in 1978. Dr. Mao then received a Master’s Degree in Mineral
Deposits from the Chinese Academy of Geological Sciences (Ӻ͛৫)i n
1982 in the PRC. Dr. Mao received a Doctorate Degree from the Graduate School of the
Chinese Academy of Geological Sciences (Ӻ͛৫) in the PRC in 1988. Dr.
Mao was awarded the Second Class Award of State Science and Technology Progress (߅࢕
ኪҦஔආӉɚഃᆤ) in 2008, Second Class Award of State Science and Technology Progress ( ਷
ኪҦஔආӉɚഃᆤ) in 2012, Second Class Award of State Natural Science (ኪ
ɚഃᆤ) in 2016, and Second Class Award of State Natural Science (ኪɚഃᆤ)i n
2020.
Dr. Shen Zhengchang (׹݁)aged 64, is an Independent Non-executive Director of
our Company and is responsible for supervising and providing independent advice to the
Board. Dr. Shen joined our Group in January 2022 and has since served as an academician at
the Chinese Academy of Engineering ( ʕ਷ʈ೻৫).
Dr. Shen has over 40 years of experience engaging in technical research, design, and
engineering of selection and metallurgical process technology. From August 1982 to July 2019,
Dr. Shen held positions as an Assistant Engineer, Engineer, Senior Engineer, Director of the
Flotation Division, and Deputy Chief Engineer of BGRIMM Technology Group Company
Limited (Ӻᐼ৫). Dr. Shen has successively served as the Chief Expert and Chief
Scientist of BGRIMM Technology Group Company Limited (ʮ̡) since
August 2019.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 461 ---
Dr. Shen received a Bachelor’s Degree in mining machinery from the Beijing Institute of
Iron and Steel Engineering ( ̏ԯ፻᚛ኪ৫) (currently known as the University of Science and
Technology Beijing (Ҧɽኪ)) in 1982 in the PRC. Dr. Shen then received a Master’s
Degree in mineral processing from Central South University of Technology (ʈุɽኪ)i n
1995 in the PRC. Dr. Shen received a Doctorate Degree from the University of Science and
Technology Beijing (Ҧɽኪ) in 2008 in the PRC. Dr. Shen was awarded the Third Class
Award of State Technological Invention (ᆤɧഃᆤ) in 1995, Second Class Award
of State Scientific and Technological Progress (ኪҦஔආӉᆤɚഃᆤ) in 2000, Second
Class Award of State Scientific and Technological Progress (ኪҦஔආӉᆤɚഃᆤ)i n
2001, and Second Class Award of State Scientific and Technological Progress (ኪҦஔ
ආӉᆤɚഃᆤ) in 2012.
Mr. Hu Nailian (ɗஹ) (former name:ɗᑌ), aged 69, is an Independent Non-
executive Director of our Group and is responsible for supervising and providing independent
advice to the Board. Mr. Hu joined our Group in January 2022.
Mr. Hu is primarily engaged in teaching and researching within the realm of mining
systems engineering, mine informationization and intelligent mines, mining technology and
economics and others. Mr. Hu held academic positions as a Director of the Research Institute,
head of the Department of Resource Engineering, and Deputy Dean of the School of Civil and
Resource Engineering of the University of Science and Technology Beijing (Ҧɽኪ)
from 1996 to 2017, respectively.
Mr. Hu received a Bachelor’s Degree in Mining Engineering and a Master’s Degree in
Engineering from the Beijing Institute of Iron and Steel Engineering in January 1982 and
December 1985 in the PRC.
Dr. Wong Y et Ping, Ambrose ( රɓ̻), aged 45, is an Independent Non-executive
Director of our Group and is responsible for supervising and providing independent advice to
the Board. Dr. Wong joined our Group in August 2024.
Dr. Wong has a strong expertise and experience in finance, audit and risk management.
Dr. Wong was part of the Audit department at KPMG China from August 2002 to October 2007,
before taking on the role of the Vice President of Risk Analysis, Commercial Business Division
of the Hong Kong and Shanghai Banking Corporation Limited from November 2007 to May
2009. Subsequently, he served at the Standard Setting Department of the Hong Kong Institute
of Certified Public Accountants from May 2009 to February 2015, holding the position of
Associate Director at the time of his departure. He served at KPMG China from March 2015
to January 2020 and was the Director of its Quality and Risk Management Department when
he left the firm. He then assumed the position of departmental director at a regulatory authority
in Hong Kong from January 2020 until August 2023. Since October 2023, he has also been
serving as the Principal of Linkpath CPA Limited.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 462 ---
At present, Dr. Wong is a certified public accountant and a Fellow Member of the Hong
Kong Institute of Certified Public Accountants since July 2009 and March 2017 respectively,
and a certified public accountant of CPA Australia since December 2005.
Dr. Wong received a Bachelor’s Degree in commerce from the University of Melbourne
in Australia in December 2001, a Doctorate Degree in Business Administration in the Hong
Kong Polytechnic University in October 2023.
SUPERVISORY COMMITTEE
The PRC Company Law requires a joint stock limited company to establish a board of
supervisors. Our Supervisory Committee currently consists of three supervisors, one of whom
is the chairman of our Supervisory Committee. Each of the supervisors is appointed for a term
of three years which is renewable upon re-election and re-appointment.
Pursuant to the Articles of Association, the functions and powers of the board of
supervisors include, among other things, reviewing the financial management of our Company,
supervising the performance of our Directors and senior management members, and monitoring
as to whether they comply with the law, administrative stipulations and Articles of Association
when performing their duties, requesting Directors and senior management members to rectify
actions detrimental to our Company’s interests. In addition, our board of supervisors is
responsible for exercising other powers, functions, and duties in accordance with the Articles
of Association, and all applicable laws and regulations.
The following table sets out information in respect of the Supervisors.
Name Age
Position for the
Current Tenure
Date of
Appointment
as a
Supervisor
Date of
Joining Our
Group Roles and Responsibility
Mr. Cheng
Zhenlong
(Ꮂ) /H1118/H1118/H1118/H1118/H1118/H1118
58 Chairman of the
Supervisory
Committee
January 4, 2022 December 14,
2012
Supervising the Board and
daily operation of our
Group
Mr. Ji Hongyong
(ۇߎ֙)H1118/H1118/H1118/H1118/H1118/H1118
50 Supervisor January 4, 2022 March 30, 2017 Supervising the Board and
daily operation of our
Group
Mr. Liu Fengwu
(ᄎჾͼ) /H1118/H1118/H1118/H1118/H1118/H1118
50 Employee
Representative
Supervisor
January 2, 2024 February 7,
2017
Supervising the Board and
daily operation of our
Group
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 463 ---
Mr. Cheng Zhenlong (Ꮂ), aged 58, has been a Supervisor of our Company since
January 2022 and the Chairman of the Supervisory Committee of our Company since
December 2022, respectively. Mr. Cheng is primarily responsible for supervising the Board and
daily operation of our Group.
Mr. Cheng joined our Group in December 2012. Mr. Cheng served as Deputy General
Manager and subsequently of General Manager of Jilong Mining from September 2013 to
December 2022.
Mr. Cheng received a Bachelor’s Degree in Mining Engineering from Shangdong Mining
Institute (ᘤุኪ৫) in July 1993. Mr. Cheng obtained qualification of Intermediate
Mining Engineer from the Bureau of Human Resources and Social Security of Chifeng (ࢤ
ღ҅) in December 2022.
Mr. Ji Hongyong (ۇߎ֙)aged 50, has been a Supervisor of our Company since January
2022 and is responsible for supervising the Board and daily operation of our Group. In addition
to a supervisorship held with our Company, he was the General Manager of Hanfeng Mining
from January 2023 to January 2024 and became the General Manager of Huatai Mining.
Mr. Ji joined our Group in March 2017. Upon joining our Group, Mr. Ji served as General
Manager of Wulong Mining from April 2017 to December 2021. Mr. Ji also served as a Deputy
Manager of the domestic mining department of our Company from July 2019 to January 2022.
Mr. Ji served as General Manager of Hangfeng Mining from January 2023 to December 2023.
Prior to joining our Group. Mr. Ji served as General Manager in Huinan Huibao Gold Mining
Company Limited (ʮ̡) from April 2013 to March 2017.
Mr. Ji received a Bachelor of Business Administration Degree from Beihua University ( ̏
ശɽኪ) in the PRC by way of online learning in July 2010. Mr. Ji obtained qualification of an
Economist from the Ministry of Human Resources and Social Security of the PRC ( ʕശɛ͏
ღ௅) in November 2013 and a Senior Mining Technician from the
Ministry of Human Resources and Social Security of the PRC in September 2013.
Mr. Liu Fengwu ( ᄎჾͼ), aged 50, has been an Employee Representative Supervisor of
our Company since January 2024. In addition to a supervisorship held with our Company, Mr.
Liu has been serving as the Deputy Head of the Environmental Protection Safety Department
and the V entilation Engineer of Jilong Mining since February 2017 upon joining our Group.
Mr. Liu completed a course in mining machinery ( ᘤʆዚཥ) in Inner Mongolia
University of Science & Technology Mining College (ኪ৫ (formerly
known asࣧin the PRC in 1993. Mr. Liu obtained qualification of an
Intermediate Mining Engineer from the Personnel Department of the Inner Mongolia
Autonomous Region in September 2004 and an Intermediate Electromechanical Engineer from
Bureau of Human Resources and Social Security of Chifeng in November 2012.
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SENIOR MANAGEMENT
Our senior management is responsible for your day-to-day management and business
operation.
The following table sets forth the key information in respect of the senior management.
Name Age
Position for the
current tenure
Date of
Appointment
as Senior
Management
Date of
Joining Our
Group Roles and Responsibility
Ms. Y ang Yi-fang
(˙) (also
known as Lydia
Y ang) /H1118/H1118/H1118/H1118/H1118/H1118/H1118
48 Executive Director
and Chief
Executive
Officer
July 26, 2022 April 25, 2019 Overall execution of our
development strategy,
daily operation,
business development
and financial
management of our
Group
Mr. Lyu Xiaozhao
(ѐወΊ) (former
name: Lu
Xiaozhao) /H1118/H1118/H1118/H1118/H1118
61 Executive Director,
Vice President
and Chief
Engineer
December 14,
2012
December 14,
2012
Overseeing the
engineering and
technical management
and business
development of our
Group
Mr. Gao Bo (ت)H111856 Executive Director
and Vice
President
December 14,
2012
December 14,
2012
Overseeing the operations
and management of the
Sepon Gold and Copper
Mine
Mr. Chen Zhiyong
(ۇ)H1118/H1118/H1118/H1118/H1118/H1118
51 Vice President January 18,
2021
July 1, 2018 Overseeing the governance
and corporate affairs of
Golden Star Resources
and stakeholder
relations and centralised
procurement of GSWL
Mr. Wong Hok Bun
Mario ( රኪⅳ) /H1118/H1118
45 Vice President,
Chief Financial
Officer and
Company
Secretary
July 14, 2023 July 14, 2023 Overseeing the finance
and accounting matters
and financial reporting
of our Group
Mr. Zhou Xinbing
(մอж) /H1118/H1118/H1118/H1118/H1118/H1118
48 Vice President January 18,
2023
December 14,
2012
Overseeing the
procurement, finance
and human resources
of, and supporting the
mine clinic of, LXML
Mr. Dong Shubao
(໨ૺᘒ) /H1118/H1118/H1118/H1118/H1118/H1118
42 Board Secretary January 4, 2022 December 14,
2012
Overall information
disclosure and PRC
investor relations of our
Group
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For biographical details of Ms. Y ang Yi-fang (˙), Mr. Lyu Xiaozhao ( ѐወΊ) and
Mr. Gao Bo (تsee “— Board of Directors — Executive Directors” in this section. The
details of each of the other senior management members are set out below:
Mr. Chen Zhiyong (ۇ)aged 51, joined our Group in August 2018 and was
appointed as the Vice President of our Company since September 2023. Mr. Chen is responsible
for overseeing the governance and corporate affairs of Golden Star Resources and stakeholder
relations and centralised procurement of GSWL.
Upon joining our Group, Mr. Chen has been serving as a Deputy General Manager of the
international mining division of our Group and Director and Deputy General Manager of
LXML from August 2018 to January 2021. Mr. Chen served as the Vice President of our Group
from January 2021 to January 2022 and from January 2023 onwards. From January 2022 to
September 2023, he served as our Director, and during the period from January 2022 to January
2023, he also served as our Executive President. Mr. Chen served as a Deputy General Manager
of Soremi Investment Company Limited (ʮ̡), a subordinary company of
Zhongjin Gold Corp Limited (ʮ̡) (a company listed on the Shanghai
Stock Exchange (stock code: 600489)), from February 2014 to August 2018.
Mr. Chen received a Bachelor’s Degree in Engineering from Hunan University (ɽ
ኪ) in 1996, and dual Master of Business Administration Degrees from Peking University in
the PRC and National University of Singapore in Singapore in 2003.
Mr. Wong Hok Bun Mario ( රኪⅳ), aged 45, joined our Group in July 2023 and was
appointed as the Chief Financial Officer in July 2023 and the Vice President of our Company
in September 2023. Upon the Listing, Mr. Wong will also be the Company Secretary of our
Company. Mr. Wong is primarily responsible for overseeing the finance and accounting matters
and financial reporting of our Group.
Mr. Wong has 23 years of experience in auditing, accounting, financial management, and
corporate finance. Prior to joining our Group, he worked at KPMG from August 2001 to August
2005 and from January 2006 to May 2008 with his last position being a Manager of the Audit
Department. He then worked at Zijin Mining as a Deputy Manager of the Finance Department
from September 2008 to December 2010 and served as the Financial Controller and the
Company Secretary of its associated company Monterrico Metals Plc. He then served as the
Group Financial Controller of CST Mining from December 2010 to July 2014. He also served
consecutively as the Vice President from March 2015 to December 2015, the Company
Secretary from July 2015 to August 2018, the Executive Director and the Chief Financial
Officer from December 2015 to August 2018 of Theme International Holdings Limited ( ࿲ฯ
ʮ̡), a company listed on the Main Board of the Hong Kong Stock Exchange
(stock code: 0990). Mr. Wong then served as the Chief Financial Officer and Company
Secretary of Jinchuan Group International Resources Company Limited (ʇණྠ਷ყ༟๕Ϟ
ʮ̡), a company listed on the Main Board of the Hong Kong Stock Exchange (stock code:
2362), from November 2018 to July 2023 and September 2018 to July 2023, respectively.
Concurrently, Mr. Wong served as an Independent Non-executive Director of Good Resources
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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Holdings Limited, a company previously listed on the Main Board of the Hong Kong Stock
Exchange until May 2022 (stock code: 0109) from May 2017 to June 2022. Since December
6, 2024, Mr. Wong has been appointed as an independent non-executive director of Theme
International Holdings Limited.
Mr. Wong received a Bachelor’s Degree in Economics and Finance from the University
of Hong Kong in November 2001. He has been a Fellow Member of the Hong Kong Institute
of Certified Public Accountants since July 2005, a Chartered Financial Analyst since December
2008 and a Member of The Australasian Institute of Mining and Metallurgy since May 2015.
Mr. Zhou Xinbing ( մอж), aged 48, joined our Group in December 2012 and was
appointed as the Vice President of our Company in January 2023. Mr. Zhou currently serves
as Vice President of LXML, where he is responsible for overseeing the procurement, finance
and human resources of, and supporting the mine clinic of, LXML at the PRC headquarters.
Mr. Zhou successively served as a Manager of the Securities and Legal Department of
Jilong Mining, Manager of Legal Department and Representative of Securities Affairs of our
Group from October 2010 to April 2013. Mr. Zhou then served as a Board Secretary of our
Group from April 2013 to January 2022. Mr. Zhou then worked as an Executive President of
our Group from January 2022 to January 2023.
Mr. Zhou received a Bachelor of Law Degree from Renmin University in the PRC in June
2011. Mr. Zhou obtained the qualifications to practice law from the Ministry of Justice in
February 2008.
Mr. Dong Shubao ( ໨ૺᘒ), aged 42, joined our Group in December 2012 and was
appointed as the Board Secretary of our Group in January 2022. Mr. Dong is responsible for
overall information disclosure and PRC investor relations of our Group.
Mr. Dong worked in the Marketing Department and Securities and Legal Department of
Jilong Mining from March 2012 to December 2012. Mr. Dong successively served as a staff
member, Deputy Manager, and Manager of the Securities and Legal Department of our Group
from December 2012 to September 2018. Mr. Dong then held the positions as a Manager of
Securities and Legal Department and Representative of Securities Affairs of our Group from
September 2018 to January 2022.
Mr. Dong received a Bachelor’s Degree in Political Science and Public Administration
Studies from Shandong University of Technology (ଣʈɽኪ) in the PRC in July 2005, and
a Master’s Degree in International Politics from Central China Normal University (ᇍ
ɽኪ) in the PRC in June 2009. Mr. Dong obtained the Board Secretary Qualification granted
by the Shanghai Stock Exchange in September 2013 and the qualification of Mining Rights
V aluer from the Mineral Resources/Reserves and Property Assessment Professional in the PRC
from the Mining Rights V aluer Association in the PRC in March 2023.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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INTERESTS OF DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
Save as disclosed above, (i) none of our Directors, Supervisors and members of senior
management has been a director of any public company the securities of which are listed on
any securities market in Hong Kong or overseas in the three years immediately preceding the
date of this Prospectus; (ii) none of our Directors has any interests in any business, which
competes or is likely to compete, either directly or indirectly, with our business which would
require disclosure under Rule 8.10 of the Hong Kong Listing Rules; and (iii) none of our
Directors, Supervisors and members of the senior management has any family or other
relationships among any of them or with other Directors, Supervisors and members of the
senior management.
Save as disclosed herein, to the best knowledge, information and belief of our Directors
and Supervisors having made all reasonable enquiries, there was no other matter with respect
to the appointment of our Directors and Supervisors that needs to be brought to the attention
of the Shareholders and there was no information relating to our Directors and Supervisors that
is required to be disclosed pursuant to Rule 13.51(2)(a) to (v) of the Hong Kong Listing Rules
as of the Latest Practicable Date.
COMPANY SECRETARY
Mr. Wong Hok Bun Mario ( රኪⅳ) will become the Company Secretary of our
Company upon Listing. For his biographical details, see “Senior Management” in this section.
BOARD COMMITTEES
Our Board delegates certain responsibilities to various committees. In accordance with
the relevant PRC laws and regulations and the Corporate Governance Code, Appendix C1 to
the Hong Kong Listing Rules, our Company has formed four Board committees, namely the
Strategy and Sustainability Committee, the Audit Committee, the Remuneration and Appraisal
Committee and the Nomination Committee.
Strategy and Sustainability Committee
We have established a Strategy and Sustainability Committee which consists of Chairman
Wang Jianhua, Ms. Y ang Yi-fang, Mr. Lyu Xiaozhao, Mr. Zhang Xudong and Dr. Wong Y et
Ping Ambrose, with Chairman Wang Jianhua being the Chairman of the Strategy and
Sustainability Committee. The primary duties of the Strategy and Sustainability Committee
include, but are not limited to, the following:
 conducting extensive research and making recommendations on the long-term
strategic development plans of our Company, in particular, to enhance the
Company’s sustainability in areas of ESG;
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 conducting research and providing recommendations on major investment activities
and financing proposals that are subject to the approval by the Board in accordance
with the Articles of Association of our Company;
 conducting extensive research and furnishing recommendations on major capital
financing and asset management projects that are required to be approved by the
Board as stipulated in the Articles of Association of our Company;
 conducting extensive research, evaluating and supplementing recommendations to
pivotal ESG trends and associated risks and opportunities that our Company faces;
 overseeing the formulation and implementation of our Company’s ESG objectives,
among others, setting performance goals in respect of our Company’s ESG
management, tracking the progress towards the achievement of the goals and
advising on the forthcoming measures to meet the goals; and
 dealing with other matters that are crucial to the development of our Company.
Audit Committee
We have established an Audit Committee with written terms of reference in compliance
with Rule 3.21 of the Hong Kong Listing Rules and paragraph C.4 and paragraph D.3 of Part
2 of the Corporate Governance Code, Appendix C1 to the Hong Kong Listing Rules. The Audit
Committee consists of three Directors, namely Mr. Zhang Xudong, Mr. Hu Nailian and Dr.
Wong Y et Ping Ambrose, who holds the appropriate professional qualifications as required
under Rules 3.10(2) and 3.21 of the Hong Kong Listing Rules. Dr. Wong Y et Ping Ambrose
serves as the chairman of the Audit Committee. The primary duties of the Audit Committee
include, but are not limited to, the following:
 proposing the appointment or change of external auditors to our Board, and
reviewing the qualification, independence and performance of the external auditors;
 guiding and assessing internal audit work;
 evaluating the performance of the audit function and personnel;
 examining the authenticity of financial information of our Company, reviewing
financial reports and statements of our Company and giving comments on relevant
matters;
 guiding, reviewing and evaluating the effectiveness of risk management and internal
control system;
 evaluating whether our Company has any major internal control defaults or
deficiencies;
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 reviewing results of internal investigations and responses from management in
relation to any suspected dishonesty, non-compliances, or suspected violations of
laws, rules and regulations;
 coordinating the communication among management, internal audit department,
related departments and external audit agency; and
 dealing with other matters as required by laws, regulations, rules, Articles of our
Company, terms of reference and applicable securities regulatory authorities, and
other matters that are authorized by the Board.
Remuneration and Appraisal Committee
We have established a Remuneration and Appraisal Committee with written terms of
reference in compliance with paragraph E.1 of Part 2 of the Corporate Governance Code,
Appendix C1 to the Hong Kong Listing Rules. The Remuneration and Appraisal Committee
consists of four Directors, namely Mr. Hu Nailian, Ms. Y ang Yi-fang, Dr. Mao Jingwen and Dr.
Shen Zhengchang. Mr. Hu Nailian serves as the chairman of the Remuneration and Appraisal
Committee. The primary duties of the Remuneration and Appraisal Committee include, but are
not limited to, the following:
 formulating the overall remuneration policy and structure of our Company’s
Directors, Supervisors and members of the senior management, formulating proper
and transparent remuneration procedures, and making suggestions to our Board;
 formulating individual remuneration plans for Directors, Supervisors and members
of the senior management in accordance with the terms of reference of the job
responsibilities, the importance of their positions as well as the remuneration
benchmarks for the relevant positions in other comparable companies;
 reviewing and approving remuneration proposals of members of our senior
management in accordance with our Company’s policies and objectives as approved
by our Board from time to time;
 making recommendations to our Board on remuneration of our non-executive
Directors (including independent non-executive Directors), Supervisors, advisors to
the Board (if any) and committees of our Board;
 reviewing and approving compensation payable to our executive Directors,
Supervisors and members of senior management for loss or termination of office or
appointment, so as to ensure that such compensation is consistent with the terms of
relevant contracts, and if such compensation is not determined in accordance with
the relevant contract terms, compensation should be fair, reasonable and not
excessive;
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 examining the criteria of performance evaluation of Directors and the senior
management of our Company, and conducting annual performance evaluation;
 supervising the implementation of the remuneration plan of the Company;
 reviewing and/or approving matters relating to share schemes under Chapter 17 of
the Hong Kong Listing Rules; and
 dealing with other matters as required by laws, regulations, rules, Articles of our
Company, terms of reference and applicable securities regulatory authorities, and
other matters that are authorized by the Board.
Nomination Committee
We have established a Nomination Committee with written terms of reference in
compliance with paragraph B.3 of Part 2 of the Corporate Governance Code, Appendix C1 to
the Hong Kong Listing Rules. The Nomination Committee consists of four Directors, namely
Mr. Hu Nailian, Mr. Lyu Xiaozhao, Dr. Shen Zhengchang and Dr. Wong Y et Ping Ambrose.
Mr. Hu Nailian serves as the chairman of the Nomination Committee. The primary duties of the
Nomination Committee include, but are not limited to, the following:
 reviewing the structure, composition and diversity of our Board at least once a year
with reference to our Company’s business activities, scale of assets and shareholding
structure, and making recommendations to our Board on any change in Board
composition in accordance with our Company’s strategies;
 making recommendations on the appointment and re-appointment of our Directors
(in particular, the chairperson of our Board, and including our non-executive
Directors and independent non-executive Directors) and our general manager;
 conducting extensive search and providing to our Board suitable candidates for
Directors, general managers and other members of the senior management;
 evaluating the independence of our independent non-executive Directors, the
performance of our Directors (including both executive and non-executive
Directors) and whether our Directors have devoted sufficient time in performing
their duties;
 developing corporate governance standards and procedures and monitoring the
implementation of such standards and procedures, and making recommendations to
our Board;
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 formulating and evaluating our Board diversity policy, and making disclosures in the
corporate governance report (which shall be included as part of our annual report)
the relevant policies, including the nomination procedures adopted by the
nomination committee and standards for the election of our Board members; and
 dealing with other matters as required by laws, regulations, rules, Articles of our
Company, terms of reference and applicable securities regulatory authorities, and
other matters that are authorized by the Board.
BOARD DIVERSITY POLICY
We are committed to promoting the culture of diversity in the Company. We have strived
to promote diversity to the extent practicable by taking into consideration a number of factors
in our corporate governance structure.
We have adopted the Board Diversity Policy which sets out the objective and approach
to achieve and maintain diversity of our Board in order to enhance the effectiveness of our
Board. Pursuant to the Board Diversity Policy, we seek to achieve Board diversity through the
consideration of a number of factors, including but not limited to gender, age, race, cultural
background, educational background, industry experience and professional experience. Our
Directors have a balanced mix of knowledge and skills, including knowledge and experience
in the areas of business management, mining and smelting, legal, economics, investment and
accounting. Our independent non-executive Directors have solid experiences in the fields of
mining, smelting and resources engineering, representing more than one-third of the members
of our Board. Our Board Diversity Policy is well implemented as evidenced by the fact that
there are Directors ranging from 45 years old to 69 years old and comprises one female
Director and eight male Directors.
We will implement policies to ensure gender diversity when recruiting staff to develop a
pipeline of female senior management and potential successors to the Board. We will strive to
enhance our female representation and achieve appropriate balance of gender diversity with
reference to the stakeholders’ expectation and international and local recommended best
practices. Furthermore, we will implement comprehensive programs aimed at identifying and
training our female staff who display leadership and potential, with the goal of promoting them
to the senior management or the Board.
Our Nomination Committee is responsible for ensuring the diversity of our Board
members. After the Listing, our Nomination Committee will review the Board Diversity Policy
from time to time, develop and review measurable objectives for implementing the policy, and
monitor the progress on achieving these measurable objectives to ensure its continued
effectiveness. We will disclose in our corporate governance report about the implementation of
the board diversity policy on an annual basis.
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CONFIRMATION UNDER THE HONG KONG LISTING RULES
Each of our Directors has obtained the legal advice in accordance with Rule 3.09D of the
Hong Kong Listing Rules from DLA Piper Hong Kong by August 2024 and that each of our
Directors has confirmed he/she understood his/her obligations as a director of a listed issuer.
Further, each of our independent non-executive Directors has confirmed:
(a) his independence as regards each of the factors referred to in Rule 3.13(1) to (8) of
the Hong Kong Listing Rules;
(b) he has no past or present financial or other interest in the business of our Group or
any connection with any core connected person of our Company, if any; and
(c) that there are no other factors that may affect the independent non-executive
Director’s independence at the time of his appointment.
COMPENSATION OF DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
The Directors, Supervisors and senior management receive their remuneration in the form
of Directors’ or Supervisors’ salary and allowances, contributions to our retirement benefit
scheme, discretionary bonuses and other benefits in kind (if applicable).
For the three years ended December 31, 2023 and the nine months ended September 30,
2024, the total remuneration paid to our then Directors amounted to approximately RMB26.89
million, RMB20.34 million, RMB20.95 million, and RMB10.49 million, respectively.
For the three years ended December 31, 2023 and the nine months ended September 30,
2024, the total remuneration paid to our then Supervisors amounted to approximately RMB3.99
million, RMB2.24 million, RMB1.56 million, and RMB0.77 million, respectively.
Under the arrangement currently in force, we estimate the total compensation before
taxation to be accrued to our Directors and our Supervisors in kind for their service for the year
ending December 31, 2024 to be approximately RMB17.07 million. The actual remuneration
of Directors and Supervisors in 2024 may be different from the expected remuneration.
For the three years ended December 31, 2023 and the nine months ended September 30,
2024, the total emoluments paid to the five highest paid individuals (including Directors and
Supervisors) by our Group amounted to approximately RMB19.58 million, RMB15.90 million,
RMB17.40 million, and RMB9.76 million, respectively.
For the three years ended December 31, 2023 and the nine months ended September 30,
2024, no fees were paid by our Group to any of the Directors, Supervisors or the five highest
paid individuals as an inducement to join us or as compensation for loss of office.
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During the Track Record Period, no remuneration was paid by the Company to the
Directors, Supervisors or the five highest-paid individuals as an inducement to join or upon
joining the Company. No compensation was paid to by the Company, or receivable by, the
Directors or former Directors of our Company, Supervisors or former Supervisors or the five
highest paid individuals for the loss of office as director or supervisor of any member of our
Group or for loss of any other office in connection with the management of the affairs of any
member of our Group.
Save as disclosed above, none of the Directors or Supervisors waived their remuneration
during the relevant period. The remuneration of Directors, Supervisors and senior management
is determined with reference to factors including operating results of our Company, market
comparables and the achievement of major operating indicators of our Company.
EMPLOYEE STOCK OWNERSHIP PLANS
Our Company adopted the ESOPs to incentivize, among others, our Directors and senior
management for their contribution to our Group and to attract, motivate, retain and reward
suitable personnel in our Group. See paragraph headed “C. Further Information about our
Directors, Supervisors and Substantial Shareholders — 4. Employee Stock Ownership Plans”
in Appendix VII to this Prospectus for details.
CORPORATE GOVERNANCE
Our Company aims to achieve high standards of corporate governance which are crucial
to our development and safeguard the interests of our Shareholders. To accomplish this, we
expect to comply with the Corporate Governance Code set out in Appendix C1 to the Hong
Kong Listing Rules after the Listing.
As a joint stock company incorporated in the PRC with our A shares listed on the
Shanghai Stock Exchange, we maintain a centralized management and control in the PRC. The
decision-making processes, and the coordination and management of the implementation of the
corporate matters are conducted by our Directors and management team from its PRC
headquarters. The business activities of our Group’s subsidiaries in the PRC, Laos and Ghana
are managed, monitored, and approved/disapproved by the Company from its PRC
headquarters. Through our Group’s centralized management system, our Directors and senior
management have full and timely access to books and records regarding our Group’s operations
outside of the PRC. The principal books and records of our Company are also located and
maintained in the PRC.
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COMPLIANCE ADVISOR
We have appointed Goldlink Capital (Corporate Finance) Limited as our compliance
advisor (the “ Compliance Advisor ”) pursuant to Rule 3A.19 of the Hong Kong Listing Rules.
The Compliance Advisor will provide us with guidance and advice as to compliance with the
Hong Kong Listing Rules and other applicable laws, rules, codes and guidelines. Pursuant to
Rule 3A.23 of the Hong Kong Listing Rules, the Compliance Advisor will advise our Company
in certain circumstances including:
(a) before the publication of any regulatory announcement, circular or financial report;
(b) where a transaction, which might be a notifiable or connected transaction, is
contemplated, including share issues and share repurchases;
(c) where we propose to use the proceeds of the Global Offering in a manner different
from that detailed in this Prospectus or where our business activities, developments
or results deviate from any forecast, estimate or other information in this Prospectus;
and
(d) where the Hong Kong Stock Exchange makes an inquiry to our Company regarding
unusual movements in the price or trading volume of its listed securities or any other
matters in accordance with Rule 13.10 of the Hong Kong Listing Rules.
Pursuant to Rule 3A.24 of the Hong Kong Listing Rules, the Compliance Advisor will,
on a timely basis, inform our Company of any amendment or supplement to the Hong Kong
Listing Rules that are announced by the Hong Kong Stock Exchange. The Compliance Advisor
will also inform our Company of any new or amended law, regulation or code in Hong Kong
applicable to us, and advise us on the continuing requirements under the Hong Kong Listing
Rules and applicable laws and regulations.
The term of the appointment will commence on the Listing Date and is expected to end
on the date on which our Company complies with Rule 13.46 of the Hong Kong Listing Rules
in respect of our financial results for the first full financial year commencing after the Listing
Date.
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BEFORE THE GLOBAL OFFERING
As of the Latest Practicable Date, the registered capital of our Company was
RMB1,663,911,378, comprising 1,663,911,378 A Shares of nominal value RMB1.00 each, all
of which are listed on the Shanghai Stock Exchange.
Description of Shares Number of Shares
Percentage of
issued share
capital
A Shares /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,663,911,378 100.00%
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,663,911,378 100.00%
UPON COMPLETION OF THE GLOBAL OFFERING
Immediately following the completion of the Global Offering, assuming that the Offer
Size Adjustment Option and the Over-allotment Option are not exercised, the entire share
capital of our Company would be as follows:
Description of Shares Number of Shares
Approximate
percentage of the
enlarged issued
share capital
A Shares /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,663,911,378 89.00%
H Shares issued pursuant to the Global Offering /H1118/H1118205,652,000 11.00%
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,869,563,378 100.00%
Immediately following the completion of the Global Offering and assuming that the Offer
Size Adjustment Option is fully exercised but the Over-allotment Option is not exercised, the
entire share capital of our Company would be as follows:
Description of Shares Number of Shares
Approximate
percentage of the
enlarged issued
share capital
A Shares /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,663,911,378 87.56%
H Shares issued pursuant to the Global Offering /H1118/H1118236,499,800 12.44%
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,900,411,178 100.00%
SHARE CAPITAL
– 464 –


--- page 476 ---
Immediately following the completion of the Global Offering and assuming that the
Over-allotment Option is fully exercised but the Offer Size Adjustment Option is not exercised,
the entire share capital of our Company would be as follows:
Description of Shares Number of Shares
Approximate
percentage of the
enlarged issued
share capital
A Shares /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,663,911,378 87.56%
H Shares issued pursuant to the Global Offering /H1118/H1118236,499,800 12.44%
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,900,411,178 100.00%
Immediately following the completion of the Global Offering and assuming that the Offer
Size Adjustment Option and the Over-allotment option are fully exercised, the entire share
capital of our Company would be as follows:
Description of Shares Number of Shares
Approximate
percentage of the
enlarged issued
share capital
A Shares /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,663,911,378 85.95%
H Shares issued pursuant to the Global Offering /H1118/H1118271,974,600 14.05%
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,935,885,978 100.00%
OUR SHARES
The H Shares in issue upon completion of the Global Offering and A Shares, are ordinary
shares in the registered share capital of our Company. Apart from certain qualified domestic
institutional investors in the PRC, the qualified PRC investors under the Shanghai-Hong Kong
Stock Connect and the Shenzhen-Hong Kong Stock Connect and other persons who are entitled
to hold our H Shares pursuant to relevant PRC laws and regulations or upon approvals of any
competent authorities, H Shares generally cannot be subscribed for by or traded between legal
or natural PRC persons. A Shares can only be subscribed for by and traded between legal or
natural persons of the PRC, qualified foreign institutional investors or qualified foreign
strategic investors or the Hong Kong and overseas investors under the Shanghai-Hong Kong
Stock Connect and the Shenzhen-Hong Kong Stock Connect. H Shares may only be subscribed
for and traded in Hong Kong dollars. A Shares, on the other hand, may only be subscribed for
and traded in Renminbi. A Shares and H Shares are regarded as one class of Shares under our
Articles of Association.
SHARE CAPITAL
– 465 –


--- page 477 ---
RANKING
The differences between A Shares and H Shares, the provisions on class rights, the
dispatch of notices and financial reports to Shareholders, dispute resolution, registration of
Shares on different registers of shareholders, the method of Share transfer, appointment of
dividend receiving agents and other matters are set out in our Articles of Association and
summarized in the section headed “Summary of Articles of Association” in Appendix VI to this
Prospectus.
Except for the differences above, A Shares and H Shares will rank pari passu with each
other in all other respects and, in particular, will rank equally for all dividends or distributions
declared, paid or made after the date of this Prospectus. All dividends in respect of the H Shares
are to be calculated in Renminbi and paid by us in Hong Kong dollars whereas all dividends
in respect of A Shares are to be paid by us in Renminbi. In addition to cash, dividends may be
distributed in the form of Shares.
CONVERSION OF OUR A SHARES INTO H SHARES FOR LISTING AND TRADING
ON THE HONG KONG STOCK EXCHANGE
A Shares and H Shares are generally neither interchangeable nor fungible, and the market
prices of our A Shares and H Shares may be different after the Global Offering. In accordance
with the Guidelines on Application for “Full Circulation” of Domestic Unlisted Shares of
H-share Companies (H΅͡ሗ“ஷ”ˏ) (the “ Full Circulation
Guidelines ”) published and implemented by the CSRC on November 14, 2019 and latest
amended on August 10, 2023, domestic unlisted shares of H-share companies (including
domestic unlisted shares held by domestic shareholders prior to the overseas listing, domestic
unlisted shares further issued in the PRC after the overseas listing and unlisted shares held by
foreign shareholders) could be listed and traded on the Hong Kong Stock Exchange after filing
with the CSRC. The Full Circulation Guidelines are only applicable to domestic companies
listed on the Hong Kong Stock Exchange and are not applicable to companies dual listed in the
PRC and on the Hong Kong Stock Exchange. As of the Latest Practicable Date, there are no
relevant rules or guidelines from the CSRC providing that A shares holders may convert A
shares held by them into H shares for listing and trading on the Hong Kong Stock Exchange.
SHARE CAPITAL
– 466 –


--- page 478 ---
APPROV AL FROM HOLDERS OF A SHARES REGARDING THE GLOBAL
OFFERING
We have obtained approval from our holders of A Shares to issue H Shares and seek the
listing of H Shares on the Hong Kong Stock Exchange. Such approval was obtained at the
general meeting of our Company held on August 23, 2024 upon, among other things, the
following major terms:
(i) Size of the offer
The proposed number of H Shares to be offered initially shall not exceed 15% of the total
issued number of shares as enlarged by the H Shares to be issued pursuant to the Global
Offering. The number of H Shares to be issued pursuant to the exercise of the Over-allotment
Option shall not exceed 15% of the total number of H Shares to be offered initially pursuant
to the Global Offering.
(ii) Method of offering
The method of offering shall be by way of a public offer for subscription in Hong Kong
and an international offering to institutional and professional investors.
(iii) Target investors
The H Shares shall be issued to overseas professional organizations, institutions
individual investors and other eligible investors.
(iv) Price determination basis
The issue price of the H Shares will be determined after due consideration of the interests
of existing Shareholders, the acceptance of investors and issuance risks and in accordance with
international practices through the demands for orders and book building process, subject to
the domestic and overseas capital market conditions and by reference to the valuation level of
comparable companies in domestic and overseas markets.
(v) Validity period
The issue of H Shares and listing of H Shares on the Hong Kong Stock Exchange shall
be completed within 18 months from the date when the Shareholders’ meeting was held on
August 23, 2024.
There is no other approved offering plans for any other shares except for the Global
Offering.
SHAREHOLDERS’ GENERAL MEETINGS
For details of circumstance under which our Shareholders’ general meeting is required,
see the section headed “Summary of Articles of Association” in Appendix VI to this
Prospectus.
SHARE CAPITAL
– 467 –


--- page 479 ---
As of the Latest Practicable Date, our share capital was RMB1,663,911,378 comprising
1,663,911,378 A Shares. The following persons directly or indirectly control, or are entitled to
exercise, or control the exercise of, 5% or more of our A Shares as of the Latest Practicable
Date:
LONG POSITIONS IN THE SHARES OF OUR COMPANY
Name of Shareholders
Nature of
interest
Description of
Shares
Number of
Shares
Approximate
percentage of
interest in the total
issued Share capital
as of the Latest
Practicable Date
Ms. Li (1),(2) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Beneficial
owner
A Shares 190,410,595 11.44%
Interest in
controlled
corporation
A Shares 51,515,151 3.10%
Notes:
(1) As of the Latest Practicable Date, Ms. Li pledged 34,000,000 A Shares, representing approximately 2.04% of
our Company’s total issued share capital, to a PRC licensed financial institution for her personal financing
purpose.
(2) Ms. Li the sole limited partner of Hanfeng Zhongxing accounting for approximately 99.00% of the committed
capital contribution of Hanfeng Zhongxing. Accordingly, Ms. Li is deemed to be interested in the 51,515,151
A Shares held by Hanfeng Zhongxing. Meanwhile, as of the Latest Practicable Date, Hanfeng Zhongxing
pledged 27,533,040 A Shares, accounting for approximately 1.65% of our Company’s total issued share capital,
to a PRC licensed financial institution for Ms. Li’s personal financing purposes.
Immediately following the completion of the Global Offering:
 assuming the Offer Size Adjustment Option and the Over-allotment Option are not
exercised, our share capital will comprise 1,663,911,378 A Shares and 205,652,000
H Shares representing 89.00% and 11.00% of the total share capital of our Company,
respectively; and
 assuming the Offer Size Adjustment Option and the Over-allotment Option are fully
exercised, our share capital will comprise 1,663,911,378 A Shares and 271,974,600
H Shares, representing 85.95% and 14.05% of the total share capital of our
Company, respectively.
SUBSTANTIAL SHAREHOLDERS
– 468 –


--- page 480 ---
So far as our Directors are aware, immediately following the completion of the Global
Offering (and the offering of any additional H Shares pursuant to the exercise of Offer Size
Adjustment Option and/or the Over-allotment Option), the following persons will have an
interest or short position in our Shares or underlying Shares of our Company which would be
required to be disclosed to our Company and the Hong Kong Stock Exchange under the
provisions of Divisions 2 and 3 of Part XV of the SFO or will, directly or indirectly, be
interested in 10% or more of the nominal value of any class of share capital carrying rights to
vote in all circumstances at general meetings of our Company:
LONG POSITIONS IN THE SHARES OF OUR COMPANY
Assuming that the Offer Size
Adjustment Option and
the Over-allotment Option
are not exercised
Assuming that the Offer Size
Adjustment Option and
the Over-allotment Option
are fully exercised
Shareholders
Nature of
Interest
Description of
Shares
Number of
Shares
Approximate
percentage of
interest in the
A Shares
Approximate
percentage of
interest in the
total issued
Share capital
Approximate
percentage of
interest in the
A Shares
Approximate
percentage of
interest in the
total issued
Share capital
Ms. Li (1) /H1118/H1118/H1118/H1118/H1118Beneficial owner A Shares 190,410,595 11.44% 10.18% 11.44% 9.84%
Interest in
controlled
corporation
A Shares 51,515,151 3.10% 2.76% 3.10% 2.66%
Note:
(1) Ms. Li and Mr. Wu Zengxiang are the sole limited partner and general partner of Hanfeng Zhongxing
accounting for approximately 99.00% and 1.00% of the committed capital contribution of Hanfeng Zhongxing,
respectively. The role of Mr. Wu is to represent Hanfeng Zhongxing in external business and operational
matters upon the authorization of Ms. Li in accordance with the limited partnership agreement of Hanfeng
Zhongxing. Mr. Wu does not, and cannot exercise control over Hanfeng Zhongxing; and taking in account of
the above, the majority interest held by Ms. Li enables her to exercise de facto control of Hanfeng Zhongxing.
Therefore, Mr. Wu has no control over the voting rights in share capital of our Company held by Hanfeng
Zhongxing, nor the control of Hanfeng Zhongxing in the exercise of such voting rights. Those are rested solely
with Ms. Li. Please refer to the section headed “Relationship with our Single Largest Shareholder Group —
Our Single Largest Shareholder Group” in this Prospectus for details. Accordingly, Ms. Li is deemed to be
interested in the 51,515,151 A Shares held by Hanfeng Zhongxing.
Save as disclosed herein, our Directors are not aware of any person who will, immediately
following the Global Offering (and the offering of any additional H Shares pursuant to the
exercise of the Offer Size Adjustment Option and/or the Over-allotment Option), have an
interest or short position in our Shares or underlying Shares of our Company which would be
required to be disclosed to our Company and the Hong Kong Stock Exchange under the
provisions of Divisions 2 and 3 of Part XV of the SFO or will, directly or indirectly, be
interested in 10% or more of the nominal value of any class of share capital carrying rights to
vote in all circumstances at general meetings of our Company.
SUBSTANTIAL SHAREHOLDERS
– 469 –


--- page 481 ---
Y ou should read the following discussion and analysis with our audited
consolidated financial information as of and for the Track Record Period and Golden
Star Resources’ audited consolidated financial information from January 1, 2021 to
January 31, 2022 (date of the acquisition), including the notes thereto, included in the
Accountant’s Report in Appendix IB to this Prospectus (“Historical Financial
Information”). The consolidated financial information has been prepared in
accordance with IFRS.
Potential investors should read the whole Historical Financial Information and
not rely merely on the information contained in this section. The following discussion
and analysis contain forward-looking statements that reflect our current views with
respect to future events and financial performance. These statements are based on our
assumptions and analysis in light of our experience and perception of historical events,
current conditions, expected future developments, and other factors we believe are
appropriate under the circumstances. However, whether actual outcomes and
developments will meet our expectations and predictions depends on a number of risks
and uncertainties. Past performance is no guarantee of future results. In evaluating
our business, you should carefully consider the information provided in this
Prospectus, including, but not limited to, the sections headed “Risk Factors” and
“Business.”
OVERVIEW
We are principally engaged in the mining, processing and sale of gold. As of the Latest
Practicable Date, we owned and operated seven gold and polymetallic mines across the world,
including China, Southeast Asia, and West Africa.
Leveraging our corporate culture and management concept of “Mutual Prosperity and
Development”, we experienced the fastest growth among major gold producers in China from
2021 to 2023, according to Frost & Sullivan, with a CAGR of 33.1% in gold production over
that period. According to Frost & Sullivan, among gold producers in China, we had the greatest
overseas presence both in terms of overseas assets contribution as of December 31, 2023 and
in terms of overseas revenue contribution for the year ended December 31, 2023.
FINANCIAL INFORMATION
– 470 –


--- page 482 ---
KEY FACTORS AFFECTING OUR RESULTS OF OPERATIONS
Set forth below are certain key factors which have historically affected our results of
operations and may continue to impact our results in the future:
Gold and Non-Ferrous Metal Prices and Demand in End Markets
During the Track Record Period, a substantial portion of our revenue was derived from
the sale of gold. Our revenue derived from sales of gold was 78.5%, 84.6%, 87.6%, 88.3% and
89.4% in 2021, 2022 and 2023 and the nine months ended September 30, 2023 and 2024. We
also generated revenue from sales of non-ferrous metals for the same period. As such,
fluctuations in gold and non-ferrous metal prices directly affect our results of operations.
Please also see “Risk Factors — Changes in the market price for gold mining and other Mineral
Resources, which in the past have experienced significant volatility, affect the profitability of
our operations and the cash flows generated by those operations.”
We sell gold produced in and outside of China to Chinese domestic and international gold
refineries, the prices of which is referenced to the market prices quoted by the Shanghai Gold
Exchange and the London Bullion Market Association, respectively. The spot price of gold on
the Shanghai Gold Exchange closely follows international gold prices. The international price
of gold is affected by numerous factors over which we have no control, such as, for example,
general supply of and demand for gold, gold sales and purchases by central banks,
macroeconomic factors such as inflation and interest rates, geopolitical conflicts (for instance,
the Russo-Ukrainian War and Israeli-Palestinian conflict), and speculative trading activity.
Historically, international gold prices have experienced significant volatility. For example,
according to Frost & Sullivan, in 2021, as the global economy started to recover from the
COVID-19 pandemic and interest in gold investments decreased, the growth of the global gold
spot price slowed down. However, in 2022, the Russia-Ukraine conflict led to a significant
increase in the global gold price. Since November 2022, the gold price has climbed again due
to market turbulence, rising recession expectations, slower interest rate hike prospects, and
more gold purchases from central banks which underpinned the gold demand. Moreover, the
price of gold in China is affected by Renminbi to U.S. dollar exchange rate. Historically, the
gold price generally increases when inflation increases.
The market price of non-ferrous metals, such as copper, is largely subject to market
forces, in particular, the supply and demand for such products. Price volatility of non-ferrous
metals is also affected by the global and PRC economic cycles and fluctuations in the global
currency markets. Any significant decrease in non-ferrous metal prices may materially and
adversely affect our business, financial condition and results of operations.
FINANCIAL INFORMATION
– 471 –


--- page 483 ---
Our revenue also tends to fluctuate with the demand for our products from the end
markets. Our gold products are used for, amongst other things, central bank gold reserves,
including the PBOC gold reserves, investment, jewelries, and other industrial purposes, and
our non-ferrous metals are widely applied in fields such as infrastructure, architecture, and
device management. Accordingly, demand for our gold and non-ferrous metals is indirectly
affected by the growth and fluctuations of these end markets.
During the Track Record Period, we obtained short-term financing via gold leasing
contracts. Meanwhile, we entered into futures contracts to hedge the risk of gold price
fluctuations. Furthermore, during the Track Record Period, we entered into hedging
transactions, such as gold forward sales contracts and forward exchange contracts, to secure
our revenue in view of the volatility in gold prices.
Production Volume
Our results of operations are dependent on our production volume of gold and non-ferrous
metals. In 2021, 2022 and 2023 and the nine months ended September 30, 2023 and 2024, in
our gold production business in China we produced 67.2 koz, 74.6 koz, 106.8 koz, 73.0 koz,
and 81.6 koz of gold, respectively. For the same period, in our gold production business in Laos
we produced 193.0 koz, 199.5 koz, 193.2 koz, 140.9 koz, and 125.9 koz of gold, respectively.
Also, in our gold production business in Ghana, which we acquired in January 2022, we
produced 162.1 koz, 161.5 koz, 116.0 koz, and 138.0 koz of gold in 2022 and 2023 and the nine
months ended September 30, 2023 and 2024, respectively. For more operating data of our
mines, please see “Business — Our Gold Production Business in China,” “Business — Our
Gold Production Business in Laos,” and “Business — Our Gold Production Business in
Ghana”. The following table sets forth our gold production volume in relation to our gold
mining businesses for the periods indicated:
Y ear Ended December 31,
Nine Months Ended
September 30,
2021 2022 2023 2023 2024
(koz)
Wulong Gold Mine (China) /H1118 28.0 43.8 59.2 40 47
Jilong Gold Mine (China) /H1118/H1118 34.3 29.5 44.7 31 28
Huatai Gold Mine (China) /H1118/H1118 4.9 1.3 0.5 1 –
Jintai Gold Mine (China) /H1118/H1118/H1118 –– 2 . 4–7
Sepon Gold and Copper
Mine (Laos) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118193.0 199.5 193.2 141 126
Wassa Gold Mine (Ghana) /H1118 – 162.1 161.5 116 138
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118260.2 436.2 461.5 329 346
FINANCIAL INFORMATION
– 472 –


--- page 484 ---
Our production volume is affected by various factors, including, for example, the capacity
and efficiency of our processing operations and labor and third-party contractors. Actual
production volume may vary from our production plan, which may cause our actual results of
operations to vary from our projected results. This is due to a variety of reasons, including,
among others, actual gold and non-ferrous metal ores mined varying from estimates in grade,
tonnage, metallurgical and other characteristics, decreases in metal prices which may cause
Reserves that are currently economical to become uneconomical, and natural phenomena such
as weather conditions, floods, droughts and rock falls, many of which are beyond our control.
Please also see “Risk Factors — Risks Relating to Our Business and Industry — We may not
be able to meet our estimated gold and other minerals production volume”.
Cost of Sales and Recovery Rate
Our cost of sales primarily comprises materials expense, labor expense, electricity fees,
depreciation and amortization, and others. Materials expense primarily consists of explosive
materials, diesel and other materials used in our operations. Labor expense refers to the salaries
and benefits paid to personnel involved in our production activities. Depreciation and
amortization costs are related to the depreciation of fixed assets and amortization of intangible
assets. Certain major components of our operating cash costs, such as mining and processing
related costs, directly relate to our mining and production volume, and increases in our mining
and production volume will lead to increases in such costs. Additional capital expenditure will
increase our depreciation and amortization costs, which will in turn increase our cost of sales.
See “— Description of Key Statement of Profit or Loss Items — Cost of sales” and “Risk
Factors — Risks Relating to Our Business and Industry — We may not be able to maintain
adequate, uninterrupted, timely and specification-compliant supplies of utilities, materials,
equipment and service at commercially acceptable prices, or at all.”
Materials expense is the largest component of our cost of sales, which represented 39.5%,
47.5%, 41.2%, 42.5% and 40.6% of our total cost of sales for the years ended December 31,
2021, 2022 and 2023 and the nine months ended September 30, 2023 and 2024, respectively.
The increase of materials expense in 2022 was affected by: (i) our acquisition of Golden Star
Resources in January 2022; and (ii) the increase in raw materials prices, affected by inflation
and the COVID-19 pandemic. The decrease of materials expense in 2023 was affected by our
cost reduction and cost control measures at our gold mines. For our operations in China, we
procured most of the principal materials used in our production from local suppliers, including
explosive materials, diesel, sodium cyanide, and cement. For our operations in Laos, we
procured diesel fuel, electricity, and certain low-value consumables from local suppliers, while
we procured industrial chemicals and reagents, explosive materials, equipment maintenance
spare parts, and other consumables from overseas suppliers. For our operations in Ghana, we
procured various materials, such as diesel oil, electricity, certain low-value consumables, bulk
industrial chemicals and reagents, explosive materials, equipment maintenance spare parts, and
other major consumables from domestic and overseas suppliers.
FINANCIAL INFORMATION
– 473 –


--- page 485 ---
Our mining efficiency is also measured by recovery rate, in particular, the gold processing
recovery rate in the PRC, Laos and Ghana. In 2023, the gold processing recovery rate of
Wulong Gold Mine, Jilong Gold Mine, Huatai Gold Mine and Jintai Gold Mine reached 91.3%,
97.7%, 92.8% and 87.2%, respectively, and the gold processing recovery rate of the Wassa
Gold Mine reached 95.5% for the same period. In the nine months ended September 30, 2024,
Sepon Gold and Copper Mine’s gold recovery rate reached 64.4%. Our processing recovery
rate is affected by both the grade and mineralization characteristic ores and the processing
process. A lower recovery rate would result in increased cost of sales. For more on the recovery
rates of our mines, please see “Business — Our Gold Production Business in China —
Operation Performance”, “Business — Our Gold Production Business in Laos — Operation
Performance”, and “Business — Our Gold Production Business in Ghana — Operation
Performance”. We aim to continuously improve our recovery rate, especially the gold recovery
rate of the Sepon Gold and Copper Mine, through technological improvements.
Acquisitions
We acquired Golden Star Resources and Xinhenghe Mining during the Track Record
Period, which significantly improved our financial performances and results of operations in
gold mining. For more details, please see “Business — Our Gold Production Business in
China” and “Business — Our Gold Production Business in Ghana”. We will continue to expand
our footprints in the PRC and the global mining market. Please see “Business — Our
Strategies” and “Future Plans and Use of Proceeds” for more details about our expansion plans.
Our overall growth is driven by both ongoing growth and strategic acquisitions. We
believe that our ability to successfully execute our acquisition strategies and integrate the
acquired operations with our existing operations have contributed to our business and results
of operations. Going forward, we will continue to consider strategic acquisitions. Our ability
to identify quality acquisition targets, negotiate favorable terms, and integrate and optimize
acquired operations will continue to impact our business, financial condition and results of
operations.
Acquisition of Xinhenghe Mining
On December 30, 2022, we entered into an equity transfer agreement with Y unnan
Y uanhao Mining Co., Ltd. (ʮ̡), certain individual shareholders of
Xinhenghe Mining and Xinhenghe Mining, pursuant to which we acquired a 51% equity
interest in Xinhenghe Mining. The cash consideration was approximately RMB61.2 million in
aggregate and determined by reference to the valuation of the assets of the acquired entity.
Xinhenghe Mining holds a 90% equity interest in Jintai Mining, the core assets of which is the
Xidengping Mine, a gold mine in Y unnan.
FINANCIAL INFORMATION
– 474 –


--- page 486 ---
The acquisition was completed on January 9, 2023, upon which Xinhenghe Mining
became our non-wholly owned subsidiary. All necessary approvals from the relevant
authorities have been obtained. We began consolidating the profit and loss accounts of
Xinhenghe Mining from January 9, 2023, and our results of operations for the Track Record
Period reflected the consolidation of Xinhenghe Mining’ results from January 9, 2023 to
September 30, 2024.
Acquisition of Golden Star Resources
In January 2022, we acquired a 62% equity interest in Golden Star Resources, which in
turn indirectly holds a 90% equity interest in GSWL, for a consideration of in aggregate
approximately US$291.0 million, which was fully settled in 2022. To finance the acquisition
of Golden Star Resources, we incurred long-term borrowings of in aggregate RMB1,104.0
million at an interest rate of 4.95% per annum. The acquisition was completed on January 31,
2022, upon which Golden Star Resources became our non-wholly owned subsidiary. The
acquisition had a significant impact on our results of operations in the financial year ended
December 31, 2022.
We consolidated the accounts of Golden Star Resources from February 1, 2022, and our
results of operations for the Track Record Period reflected the consolidation of Golden Star
Resources’ results from February 1, 2022 to September 30, 2024. Partially due to such
acquisition and consolidation, the revenue of our gold mining business increased by 78.7%
from RMB2,968.7 million for the year ended December 31, 2021 to RMB5,304.7 million for
the year ended December 31, 2022. For the same reason, the cost of sales increased by 77.1%
from RMB2,525.1 million for the year ended December 31, 2021 to RMB4,471.9 million for
the year ended December 31, 2022. As a result of the foregoing, the gross profit of our gold
mining business increased by 68.7% from RMB868.7 million for the year ended December 31,
2021 to RMB1,465.8 million for the year ended December 31, 2022. We recorded financial
income of RMB20.4 million in 2021, but partially due to the acquisition we recorded finance
costs of RMB176.5 million in 2022, among which our interest expenses increased from
RMB14.2 million in 2021 to RMB176.5 million in 2022. Our income tax expense increased
from RMB157.0 million for the year ended December 31, 2021 to RMB328.1 million for the
year ended December 31, 2022. This was partially due to a higher effective income tax rate in
Ghana and the losses incurred in the Ghana gold streaming business that was not tax
deductible. For detailed analysis of the relevant year-on-year financials comparisons, see “—
Y ear Ended December 31, 2022 Compared to Y ear Ended December 31, 2021” below.
Partially due to the acquisition: (i) our other intangible assets increased from RMB856.5
million as of December 31, 2021 to RMB6,562.7 million as of December 31, 2022 which
mainly reflects the exploration and mining rights of Golden Star Resources; (ii) our property,
plant and equipment increased from RMB3,159.7 million as of December 31, 2021 to
RMB5,994.3 million as of December 31, 2022; and (iii) our total liabilities increased from
RMB3,052.6 million as of December 31, 2021 to RMB10,136.0 million as of December 31,
2022.
FINANCIAL INFORMATION
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--- page 487 ---
The consolidated financial statements and the accompanying notes of Golden Star
Resources from January 1, 2021 to January 31, 2022 (date of the acquisition) are set forth in
Accountants’ Report included in Appendix IB to this Prospectus. For more details of Golden
Star Resources’ financial information, see “— Financial Information of Golden Star
Resources”.
Exchange Rates
The presentation currency of our consolidated financial statements presentation is
Renminbi, which is also our Company’s functional currency. However, procurement and sales
activities of our two overseas subsidiaries, LXML and GSWL, are in U.S. dollars.
Major events and occurrences, domestic, international or economic in nature, can affect
foreign exchange rates, and, consequently, our operations. These events include changes in
inflation rates, interest rates, government debt, political stability, health crises, or economic
events such as trade wars or recessions. Exchange rate fluctuations have affected our
profitability and resulted in foreign currency exchange losses of our foreign currency-
denominated assets and liabilities in the past. For the years ended December 31, 2021, 2022,
and 2023 and the nine months ended September 30, 2023 and 2024, we recognized foreign
exchange gains of RMB86.2 million, RMB27.2 million, RMB20.2 million, exchange gains of
RMB18.9 million and exchange gains of RMB27.8 million, respectively.
As a company with global operations, our future results of operations will continue to be
affected by fluctuations in exchange rates. We monitor the scale of our foreign currency
transactions and foreign currency assets and liabilities. We generally hold a minimal amount
of cash in local currencies to avoid exposure to local currency fluctuation and only purchase
local currencies when local payment is necessary. We are able to utilize all Ghanaian Cedis
received from Bank of Ghana or Lao Kips and Ghanaian Cedis converted from U.S. dollars
revenue for our operating and capital expenses within a short period of time, in order to
maintain our cash in local currencies at minimal level. Please also see “Risk Factors — Risks
Relating to Our Business and Industry — We are subject to risks related to exchange rate
fluctuations, because our gold product from overseas operation is priced in U.S. dollars and our
operating costs and expenses are incurred in different currencies, including, but not limited to,
Lao Kip and Ghanaian Cedi.”
Expansion and Capital Expenditures
According to Frost & Sullivan, the gold industry is a capital-intensive sector that demands
substantial investment in numerous equipment, land resources, and adherence to strict safety
production and environmental protection standards. It necessitates the implementation of
resource exploration, recycling processes, merger and acquisition endeavors to secure
sustainable and abundant mine Reserves. Additionally, investing in advanced technology is
crucial to address the challenges and intricacies associated with gold mining, stemming from
declining gold grades and mining at greater depths. Our existing mines in the PRC and overseas
are situated in favorable mineralization environments, showcasing significant exploration
FINANCIAL INFORMATION
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--- page 488 ---
prospects across the majority of the mining regions, and we aim to further maximize the
potential of our existing mines by continuously expanding production and continuously
investing in new technologies to improve recovery rates. Besides, we may incur costs from
potential acquisitions of high-quality gold assets for a robust and sustainable growth. For
details, see “Business — Business strategies”.
Our increasing capital expenditures during the Track Record Period reflected our
expansion investments to fuel and support our expected future growth. Our capital
expenditures amounted to approximately RMB1,559.9 million, RMB1,903.1 million,
RMB1,487.4 million, RMB1,102.2 million and RMB1,125.4 million for the years ended 31
December 2021, 2022, and 2023 and the nine months ended September 30, 2023 and 2024,
respectively, representing approximately 41.2%, 30.4%, 20.6%, 21.8% and 18.1% of our
revenue, respectively, for the same period. See “— Capital Expenditure” for a breakdown of
our total capital expenditure during the Track Record Period.
The costs associated with our capital expenditure plans could have a significant impact
on our financial condition and results of operations, particularly if we are unable to generate
sufficient gold production and sales to recover our investment or generate a profit. Therefore,
our management must consistently assess the necessary capital investments to achieve our
sustainable production objectives and boost revenue growth, while taking into account
competing cash needs and the subsequent increase in cost of sales due to higher depreciation
costs. Furthermore, acquisitions and strategic investments bring about various risks, such as
operational integration hurdles, challenges in assimilating cultures and personnel, diversion of
management focus, risks associated with entering new markets, and the potential loss of key
personnel from the acquired businesses. These factors could have a significant and adverse
impact on our business, financial standing, and operational outcomes.
Government Control and Policies on the Gold Mining Industry
The local, provincial, and central authorities of the PRC, Laos, and Ghana each exercise
a substantial degree of control over the gold and mining industry within their respective
territories. Our operations in these countries are subject to a range of national laws,
regulations, policies, standards, and requirements, particularly concerning exploration, mining,
production, taxation, labor standards, occupational health and safety, waste treatment,
environmental protection, and operational management.
In each of these jurisdictions, the respective governments hold full authority to grant,
renew, and terminate the permits and licenses for exploration, mining, and production
activities. While we anticipate being able to renew our licenses and permits in the PRC, Laos,
and Ghana, any inability to do so for any reason could materially and adversely affect our
business and results of operations.
FINANCIAL INFORMATION
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SENSITIVITY ANALYSIS
Our results of operations is principally affected by gold price and sales volume. The
tables below set forth the impact of fluctuation of gold price on our results of operations for
the period indicated.
For the year ended December 31, 2021
(Renminbi in millions, except for percentages)
Hypothetical fluctuation
of gold price/
sales volume /H1118/H1118/H1118/H1118/H1118/H1118/H1118-20% -15% -10% -5% 5% 10% 15% 20%
Change in gross profit /H1118/H1118-594 -445 -297 -148 148 297 445 594
Change in gross profit
margin /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118-12.4% -8.9% -5.7% -2.7% 2.5% 4.9% 7.0% 9.1%
Change in profit from
operation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118-594 -445 -297 -148 148 297 445 594
Change in operating
margin /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118-14.8% -10.6% -6.8% -3.3% 3.0% 5.8% 8.4% 10.8%
For the year ended December 31, 2022
(Renminbi in millions, except for percentages)
Hypothetical fluctuation
of gold price/
sales volume /H1118/H1118/H1118/H1118/H1118/H1118/H1118-20% -15% -10% -5% 5% 10% 15% 20%
Change in gross profit /H1118/H1118-1,061 -796 -530 -265 265 530 796 1,061
Change in gross profit
margin /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118-14.5% -10.4% -6.6% -3.2% 2.9% 5.6% 8.0% 10.3%
Change in profit from
operation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118-1,061 -796 -530 -265 265 530 796 1,061
Change in operating
margin /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118-17.7% -12.6% -8.0% -3.8% 3.5% 6.8% 9.8% 12.6%
For the year ended December 31, 2023
(Renminbi in millions, except for percentages)
Hypothetical fluctuation
of gold price/
sales volume /H1118/H1118/H1118/H1118/H1118/H1118/H1118-20% -15% -10% -5% 5% 10% 15% 20%
Change in gross profit /H1118/H1118-1,264 -948 -632 -316 316 632 948 1,264
Change in gross profit
margin /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118-14.3% -10.2% -6.5% -3.1% 2.8% 5.4% 7.8% 10.0%
Change in profit from
operation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118-1,264 -948 -632 -316 316 632 948 1,264
Change in operating
margin /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118-17.7% -12.6% -8.0% -3.8% 3.5% 6.7% 9.7% 12.4%
FINANCIAL INFORMATION
– 478 –


--- page 490 ---
For the nine months ended September 30, 2024
(Renminbi in millions, except for percentages)
Hypothetical fluctuation
of gold price/
sales volume /H1118/H1118/H1118/H1118/H1118/H1118/H1118-20% -15% -10% -5% 5% 10% 15% 20%
Change in gross profit /H1118/H1118-1,112 -834 -556 -278 278 556 834 1,112
Change in gross profit
margin /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118-12.6% -9.0% -5.7% -2.7% 2.5% 4.7% 6.8% 8.8%
Change in profit from
operation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118-1,112 -834 -556 -278 278 556 834 1,112
Change in operating
margin /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118-15.3% -10.9% -6.9% -3.3% 3.0% 5.8% 8.3% 10.7%
BASIS OF PREPARATION
Our historical financial information has been prepared in accordance with IFRS, which
comprise all standards and interpretations approved by the International Accounting Standards
Board. All reporting standards under IFRS effective for the accounting period commencing
from January 1, 2024, together with the relevant transitional provisions, have been adopted
early by our Group in the preparation of the historical financial information throughout the
relevant periods. The historical financial information has been prepared under the historical
cost convention. All intra-group transactions and balances have been eliminated on
consolidation.
Possible impact of amendments, new standards and interpretations issued but not yet
effective for the Track Record Period
Our Group has not applied the following new and revised IFRS reporting standards
(which have been issued but are not yet effective) in our audited consolidated financial
statements:
Amendments to IAS 21 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Lack of Exchangeability
1
Amendments to IFRS 10 and IAS 28 /H1118/H1118Sale or Contribution of Assets between an
Investor and its Associate or Joint V enture 2
IFRS 18 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Presentation and Disclosure in Financial
Statements 4
IFRS 19 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Subsidiaries without Public Accountability:
Disclosures 4
Amendments to IFRS 9 and IFRS 7 /H1118/H1118/H1118Amendments to the Classification and
Measurement of Financial Instruments 3
FINANCIAL INFORMATION
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--- page 491 ---
Notes:
1. Effective for annual periods beginning on or after January 1, 2025.
2. No mandatory effective date yet determined but available for adoption.
3. Effective for annual periods beginning on or after January 1, 2026.
4. Effective for annual periods beginning on or after January 1, 2027.
We do not anticipate the application of the new and revised IFRS reporting standards to
have a material impact on our Group’s financial position and financial performance in the
foreseeable future.
MATERIAL ACCOUNTING POLICIES, SIGNIFICANT ACCOUNTING JUDGMENTS
AND ESTIMATES
Some of our accounting policies require us to apply estimates and assumptions and
complex judgments relating to accounting items. The estimates and assumptions we use and the
judgments we make in applying our accounting policies have a significant impact on our
financial position and operating results. Our management continually evaluates such estimates,
assumptions and judgments based on past experience and other factors, including industry
practices and expectations of future events that are believed to be reasonable under the
circumstances. There has not been any material deviation between our management’s estimates
or assumptions and actual results, and we have not made any material changes to these
estimates or assumptions during the Track Record Period. We do not expect any material
changes in these estimates and assumptions in the foreseeable future.
When reviewing our consolidated financial statements, you should consider, amongst
other things: (i) information about our material accounting policy; (ii) the judgments and other
uncertainties affecting the application of such policies; and (iii) the sensitivity of reported
results to changes in conditions and assumptions. Information about our material accounting
policy, estimates and judgments, which are important for an understanding of our financial
condition and results of operations, including any changes in accounting policy and
disclosures, are set forth in detail in Notes 4 and 5 to the Accountants’ Report in Appendix IA
to this Prospectus.
Revenue recognition
Revenue from contracts with customers
Revenue from contracts with customers is recognized when control of goods or services
is transferred to the customers at an amount that reflects the consideration to which our Group
expects to be entitled in exchange for those goods or services.
FINANCIAL INFORMATION
– 480 –


--- page 492 ---
When the contract contains a financing component which provides the customer with a
significant benefit of financing the transfer of goods or services to the customer for more than
one year, revenue is measured at the present value of the amount receivable, discounted using
the discount rate that would be reflected in a separate financing transaction between our Group
and the customer at contract inception. When the contract contains a financing component
which provides our Group with a significant financial benefit for more than one year, revenue
recognized under the contract includes the interest expense accreted on the contract liability
under the effective interest method. For a contract where the period between the payment by
the customer and the transfer of the promised goods or services is one year or less, the
transaction price is not adjusted for the effects of a significant financing component, using the
practical expedient in IFRS 15.
Sale of products
Revenue from the sale of products is recognized at the point in time when control of the
asset is transferred to the customer, generally on delivery of the products.
Metal streaming arrangement
There is a Metal Streaming Arrangement in GSR acquired by our Group in 2022. Under
the business arrangement, GSR receives a payment in advance and the counterparty obtains a
certain proportion of deliverable gold within the entire life of the designated mine. The
counterparty is also required to make an additional payment based on a certain proportion of
the market price when GSR delivers the goods within an agreed period in the future. The
payment GSR receives in advance is considered to be part of the counterparty’s prepayment for
the future goods with uncertain but predictable quantity and is recognized as a contract liability
upon receipt. Each unit of the delivered goods represents a separate performance obligation,
and revenue is recognized at the point in time when control of the goods is transferred.
Considering the timing of satisfaction of delivery obligations throughout the entire life of the
mines, the contract liability above is considered to have a financing component. In addition,
because the quantity of all delivered goods available to the counterparty depends on the mining
reserves of the metals throughout the entire life of the mines, the management will estimate the
change of total metal reserves and change of planned exploitation reserves on a regular basis
and adjustments shall be made to the revenue and finance costs accordingly.
V ariable consideration
In our Group’s Metal Streaming Arrangement, because the quantity of all delivered goods
available to the counterparty depends on the mining reserves of the metals throughout the
entire life of the mine, the price allocated to goods delivered per unit is considered as variable
consideration. When the estimated total metal reserves and planned exploitation reserves of the
mine change, it is necessary to recalculate the price of goods delivered per unit, and in the
period of changes occurred, adjust the revenue and finance costs recognized in the same period
according to the updated price. Our Group determines the best estimate of variable
consideration by the expected value. The transaction price including variable consideration is
only to the extent that it is highly probable that a significant reversal in the amount of
cumulative revenue recognized will not occur when the uncertainty associated with the variable
consideration is subsequently resolved.
FINANCIAL INFORMATION
– 481 –


--- page 493 ---
Contracts for the rendering of services
A contract for the rendering of services between our Group and the customer usually
includes performance obligations of dismantling waste electronic products and electrical
appliances. Our Group recognized the fund subsidy income, which was related to the
dismantling volume, by multiplying the dismantling type and quantity of the scrapped
electronic products and electrical appliances by the corresponding fund subsidy price.
Revenue from other sources
Rental income is recognized on a time proportion basis over the lease terms. V ariable
lease payments that do not depend on an index or a rate are recognised as income in the
accounting period in which they are incurred.
Property, plant and equipment and depreciation
Property, plant and equipment are stated at cost less accumulated depreciation and any
impairment losses. The cost of an item of property, plant and equipment comprises its purchase
price and any directly attributable costs of bringing the asset to its working condition and
location for its intended use.
Expenditure incurred after items of property, plant and equipment have been put into
operation, such as repairs and maintenance, is normally charged to profit or loss in the period
in which it is incurred. In situations where the recognition criteria are satisfied, the expenditure
for a major inspection is capitalized in the carrying amount of the asset as a replacement.
Where significant parts of property, plant and equipment are required to be replaced at
intervals, our Group recognizes such parts as individual assets with specific useful lives and
depreciates them accordingly.
Depending on the nature of the item of property, plant and equipment, depreciation is
calculated on the straight-line basis to write off the cost of each asset to its residual value over
its estimated useful life or it is calculated on the Units of Production (“UOP”) basis to write
off the cost of the asset proportionately to the extraction of the proven and probable ore
reserves. The estimated useful lives and annual depreciation rates for the assets depreciated on
the straight-line basis are as follows:
Estimated
useful lives
Annual
depreciation rates
Buildings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820 years 4.75%
Machinery /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 to 10 years 9.50% to 19.00%
Mobile equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 to 10 years 9.50% to 19.00%
Electronic equipment and others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183 to 5 years 19.00% to 31.67%
FINANCIAL INFORMATION
– 482 –


--- page 494 ---
Where parts of an item of property, plant and equipment have different useful lives, the
cost of that item is allocated on a reasonable basis among the parts and each part is depreciated
separately. Residual values, useful lives and the depreciation method are reviewed, and
adjusted if appropriate, at least at the end of each of the Relevant Periods.
An item of property, plant and equipment including any significant part initially
recognized is derecognized upon disposal or when no future economic benefits are expected
from its use or disposal. Any gain or loss on disposal or retirement recognized in the statement
of profit or loss in the years/periods the asset is derecognized is the difference between the net
sales proceeds and the carrying amount of the relevant asset.
Construction in progress is stated at cost less any impairment losses and is not
depreciated. Cost comprises the direct costs of construction and capitalized borrowing costs on
related borrowed funds during the period of construction. Construction in progress is
reclassified to the appropriate category of property, plant and equipment when completed and
ready for use.
Exploration and mining rights
Exploration and evaluation assets are stated at cost less impairment losses. Exploration
and evaluation includes costs of geological prospecting for technical consultancy and costs of
feasibility study for commercial development which incurred in the surroundings, outer ring
and deep areas of the existing or externally acquired mineral properties, and costs of drilling,
trench sampling and other associated activities. Such expenditures may be capitalized when the
mineral properties are reasonably determined to be commercially available and recognized as
intangible assets after obtaining mining rights or permits, which will be amortized under the
units-of-production method. If any construction was abandoned in the development phase or
belongs to the productive exploration, all costs shall be written off and recognized in profit or
loss for the current period.
Impairment reviews of exploration and evaluation assets are undertaken if events or
changes in circumstances indicate a potential impairment. The carrying value of exploration
and evaluation assets is compared to the recoverable amount, which is the higher of
value-in-use and the fair value less costs of disposal. For the purposes of assessing impairment,
assets are grouped at the lowest levels for which there are separately identifiable cash-
generating units. Exploration and evaluation assets that suffered impairment are reviewed for
possible reversal of the impairment at each reporting date.
Exploration rights are stated at cost less impairment losses. Exploration rights include the
cost of acquiring exploration rights.
Mining rights are stated at cost less accumulated amortisation and any impairment losses.
Mining rights include the cost of acquiring mining licences, exploration rights and exploration
and evaluation assets upon determination that an exploration property is capable of commercial
production, and the cost of acquiring interests in the mining reserves of existing mining
properties. The mining rights are amortised in accordance with the production plans of the
entities concerned and the proven and probable mineral reserves of the mines using the UOP
method. Mining rights are written off to profit or loss if the mining property is abandoned.
FINANCIAL INFORMATION
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--- page 495 ---
Inventories
Inventories are stated at the lower of cost and net realizable value. Cost is determined on
the weighted average basis and, in the case of work in progress and finished goods, comprises
direct materials, direct labor and an appropriate proportion of overheads. Net realizable value
is based on estimated selling prices less any estimated costs to be incurred to completion and
disposal.
Provisions
A provision is recognized when a present obligation (legal or constructive) has arisen as
a result of a past event and it is probable that a future outflow of resources will be required to
settle the obligation, provided that a reliable estimate can be made of the amount of the
obligation.
When the effect of discounting is material, the amount recognized for a provision is the
present value at the end of each of the Relevant Periods of the future expenditures expected to
be required to settle the obligation. The increase in the discounted present value amount arising
from the passage of time is included in finance costs in profit or loss.
Provisions for our Group’s obligations for environmental rehabilitation and restoration of
mines are based on estimates of required expenditure at the mines in accordance with the local
rules and regulations where the mines are located. Our Group estimates its liabilities for final
reclamation and mine closure based upon detailed calculations of the amount and timing of the
future cash expenditure for the required work. Spending estimates are escalated for inflation,
then discounted at a discount rate that reflects current market assessments of the time value of
money and the risks specific to the liability such that the amount of provision reflects the
present value of the expenditures expected to be required to settle the obligation. Our Group
records a corresponding asset in the period in which the liability is incurred. The liability is
accreted to the projected expenditure date. As changes in estimates occur (such as mine plan
revisions, changes in estimated costs, or changes in the timing of the performance of
reclamation activities), the revisions to the obligation and the asset are recognised at the
appropriate discount rate.
Impairment of financial assets
Our Group recognized an allowance for expected credit losses (“ ECLs ”) for all debt
instruments not held at fair value through profit or loss. ECLs are based on the difference
between the contractual cash flows due in accordance with the contract and all the cash flows
that our Group expects to receive, discounted at an approximation of the original effective
interest rate. The expected cash flows will include cash flows from the sale of collateral held
or other credit enhancements that are integral to the contractual terms.
FINANCIAL INFORMATION
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--- page 496 ---
General approach
ECLs are recognized in two stages. For credit exposures for which there has not been a
significant increase in credit risk since initial recognition, ECLs are provided for credit losses
that result from default events that are possible within the next 12 months (a 12-month ECL).
For those credit exposures for which there has been a significant increase in credit risk since
initial recognition, a loss allowance is required for credit losses expected over the remaining
life of the exposure, irrespective of the timing of the default (a lifetime ECL).
At each reporting date, our Group assesses whether the credit risk on a financial
instrument has increased significantly since initial recognition. When making the assessment,
our Group compares the risk of a default occurring on the financial instrument as at the
reporting date with the risk of a default occurring on the financial instrument as at the date of
initial recognition and considers reasonable and supportable information that is available
without undue cost or effort, including historical and forward-looking information.
Our Group considers a financial asset in default when contractual payments are 90 days
past due. However, in certain cases, our Group may also consider a financial asset to be in
default when internal or external information indicates that our Group is unlikely to receive the
outstanding contractual amounts in full before taking into account any credit enhancements
held by our Group.
A financial asset is written off when there is no reasonable expectation of recovering the
contractual cash flows.
Financial assets at amortized cost are subject to impairment under the general approach
and they are classified within the following stages for measurement of ECLs except for trade
receivables which apply the simplified approach as detailed below.
Stag e 1 – Financial instruments for which credit risk has not increased significantly since
initial recognition and for which the loss allowance is measured at an amount equal to
12-month ECLs;
Stag e 2 – Financial instruments for which credit risk has increased significantly since
initial recognition but that are not credit-impaired financial assets and for which the loss
allowance is measured at an amount equal to lifetime ECLs;
Stag e 3 – Financial assets that are credit-impaired at the reporting date (but that are not
purchased or originated credit-impaired) and for which the loss allowance is measured at an
amount equal to lifetime ECLs.
FINANCIAL INFORMATION
– 485 –


--- page 497 ---
Simplified approach
For trade receivables that do not contain a significant financing component or when our
Group applies the practical expedient of not adjusting the effect of a significant financing
component, our Group applies the simplified approach in calculating ECLs. Under the
simplified approach, our Group does not track changes in credit risk, but instead recognises a
loss allowance based on lifetime ECLs at each reporting date. Our Group has established a
provision matrix that is based on its historical credit loss experience, adjusted for forward-
looking factors specific to the debtors and the economic environment.
DESCRIPTION OF KEY STATEMENT OF PROFIT OR LOSS ITEMS
The following table sets forth a summary of our consolidated statements of profit or loss
and other comprehensive income for the period indicated. Our historical results presented
below are not necessarily indicative of the results that may be expected for any future period.
Y ear Ended December 31,
Nine months Ended
September 30,
2021 2022 2023 2023 2024
(RMB’000)
(unaudited)
Revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,782,624 6,266,787 7,220,952 5,062,293 6,222,831
Cost of sales /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(2,525,121) (4,471,868) (4,868,078) (3,521,863) (3,600,815)
Gross profit /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,257,503 1,794,919 2,352,874 1,540,430 2,622,016
Other income and gains /H1118/H1118/H1118/H111890,512 142,088 137,770 90,608 271,985
Selling and distribution
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(777) (720) (689) (526) (317)
Administrative expenses /H1118/H1118/H1118/H1118(393,035) (786,368) (850,390) (622,849) (651,899)
Research and development
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(24,847) (27,652) (51,753) (24,952) (47,893)
Impairment losses on
financial assets, net /H1118/H1118/H1118/H1118/H1118(1,984) (644) (2,440) (1,119) 1,624
Other expenses and losses /H1118/H1118(142,760) (119,022) (173,501) (86,769) (189,905)
Finance costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(14,226) (176,485) (215,026) (143,290) (164,773)
Share of (losses)/profits of
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(11) (4,104) 9,950 6,721 7,197
Profit before tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118770,375 822,012 1,206,795 758,254 1,848,035
Income tax expenses /H1118/H1118/H1118/H1118/H1118/H1118(156,967) (328,132) (335,210) (196,234) (583,266)
Profit for the year/period /H1118/H1118613,408 493,880 871,585 562,020 1,264,769
Attributable to:
Owners of the parent /H1118/H1118/H1118/H1118581,949 450,976 804,471 526,655 1,115,256
Non-controlling interests /H1118/H111831,459 42,904 67,114 35,365 149,513
FINANCIAL INFORMATION
– 486 –


--- page 498 ---
Revenue
During the Track Record Period, we generated our revenue from gold mining, other
Mineral Resources and other businesses. Please see “Business — Business Overview” for more
details.
Revenue by Business Nature
The following table sets forth our revenue by business nature for the periods indicated:
Y ear Ended December 31, Nine Months Ended September 30,
2021 2022 2023 2023 2024
RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 %
(unaudited)
Gold mining /H1118/H11182,968,694 78.5 5,304,729 84.6 6,322,263 87.6 4,470,575 88.3 5,561,259 89.4
Other Mineral
Resources /H1118/H1118551,278 14.6 650,206 10.4 495,752 6.9 335,334 6.6 454,130 7.3
Others /H1118/H1118/H1118/H1118/H1118262,652 6.9 311,852 5.0 402,937 5.5 256,384 5.1 207,442 3.3
Total /H1118/H1118/H1118/H1118/H1118/H11183,782,624 100.0 6,266,787 100.0 7,220,952 100.0 5,062,293 100.0 6,222,831 100.0
Revenue by Origin of Our Products
The following table sets forth a breakdown of our revenue by origin of our products for
the periods indicated:
Y ear Ended December 31, Nine Months Ended September 30,
2021 2022 2023 2023 2024
RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 %
(unaudited)
PRC /H1118/H1118/H1118/H1118/H1118/H11181,259,688 33.3 1,477,471 23.5 2,026,833 28.1 1,301,395 25.7 1,793,374 28.8
Laos /H1118/H1118/H1118/H1118/H1118/H11182,522,936 66.7 2,998,740 47.9 3,054,614 42.3 2,239,406 44.2 2,327,466 37.4
Ghana 1 /H1118/H1118/H1118/H1118/H1118– – 1,790,576 28.6 2,139,505 29.6 1,521,492 30.1 2,101,991 33.8
Total /H1118/H1118/H1118/H1118/H1118/H11183,782,624 100.0 6,266,787 100.0 7,220,952 100.0 5,062,293 100.0 6,222,831 100.0
Notes:
1. Our revenue in Ghana was generated from Golden Star Resources. In January 2022, we acquired a 62% equity
interest in Golden Star Resources, which in turn indirectly holds a 90% equity interest in GSWL, and we began
consolidating the accounts of Golden Star Resources from February 1, 2022. As such, the revenue of GSWL
prior to February 1, 2022 was not included in our Group. For more details, please see “— Key Factors
Affecting Our Results of Operations — Acquisitions — Acquisition of Golden Star Resources.”
2. Our gold products are sold globally. Our major clients are refineries located in PRC, Thailand, Australia,
Singapore, South Africa and Ghana.
FINANCIAL INFORMATION
– 487 –


--- page 499 ---
In 2021, 2022 and 2023 and the nine months ended September 30, 2023 and 2024, our
sales volume of gold amounted to 251 koz, 445 koz, 466 koz, 336 koz and 352 koz. The
increase was mainly attributable to the acquisition of Golden Star Resources in 2022 and the
continued increase of gold production volume at both Sepon Gold and Copper Mine and
Wulong Gold Mine. For the same periods, average selling prices for our gold product was
approximately RMB381 per gram, RMB383 per gram, RMB436 per gram, RMB427 per gram,
and RMB502 per gram, respectively. We sell gold produced in- and outside of China at prices
that move in line with the spot prices set by the Shanghai Gold Exchange and the London
Bullion Market Association, respectively. The spot price of gold on the Shanghai Gold
Exchange closely follows international gold prices. Historically, international gold prices have
experienced significant fluctuations. See “— Key Factors Affecting Our Results of Operations
— Gold and Non-Ferrous Metal Prices and Demand in End Markets.”
Sales Volume and Average Selling Price
The following table sets forth our sales volume and average selling price of gold mining
business for the periods indicated.
Y ear Ended December 31, Nine Months Ended September 30,
2021 2022 2023 2023 2024
Sales
Vol.
Avg.
Selling
Price
Sales
Vol.
Avg.
Selling
Price
Sales
Vol.
Avg.
Selling
Price
Sales
Vol.
Avg.
Selling
Price
Sales
Vol.
Avg.
Selling
Price
koz RMB/g koz RMB/g koz RMB/g koz RMB/g koz RMB/g
Wulong Gold Mine /H1118/H111828.0 383.0 43.8 395.6 59.2 455.8 40.3 447.2 47.5 543.7
Jilong Gold Mine /H1118/H1118/H111834.3 371.4 29.5 397.3 44.7 455.8 31.2 449.5 27.5 536.9
Huatai Gold Mine /H1118/H1118/H11184.9 368.4 1.3 400.4 0.5 429.0 0.5 424.9 0.0 0.0
Jintai Gold Mine /H1118/H1118/H11180.0 0.0 0.0 0.0 2.2 470.3 0.0 0.0 6.8 537.9
PRC – Subtotal/
average /H1118/H1118/H1118/H1118/H1118/H1118/H111867.2 376.0 74.6 396.4 106.6 455.9 72.0 448.0 81.8 540.9
Sepon Gold and
Copper Mine /H1118/H1118/H1118/H1118183.4 382.5 214.2 389.3 193.8 443.1 143.5 432.7 131.2 507.3
Wassa Gold Mine /H1118/H1118/H11180.0 0.0 156.5 367.7 166.0 414.2 120.0 407.7 139.1 484.8
Overseas – Subtotal/
average /H1118/H1118/H1118/H1118/H1118/H1118/H1118183.4 382.5 370.7 380.2 359.8 429.7 263.5 421.3 270.3 495.7
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118250.6 380.8 445.3 382.9 466.4 435.7 335.5 427.0 352.1 506.2
Note: The average selling price was determined based on the gold metal contained in the gold products despite the
variant grades of the products.
Cost of Sales
Our cost of sales primarily comprises materials expense, labor expense, electricity fees,
depreciation and amortization, and others. Our cost of sales generally goes down and up in line
with the decrease and increase in our revenue during the Track Record Period.
FINANCIAL INFORMATION
– 488 –


--- page 500 ---
For the years ended December 31, 2021, 2022 and 2023 and the nine months ended
September 30, 2023 and 2024, our cost of sales amounted to RMB2,525.1 million,
RMB4,471.9 million, RMB4,868.1 million, RMB3,521.9 million and RMB3,600.8 million
respectively.
The following table sets forth a breakdown of our cost of sales by nature for the periods
indicated:
Y ear Ended December 31, Nine Months Ended September 30,
2021 2022 2023 2023 2024
RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 %
(unaudited)
Materials
expense /H1118/H1118/H1118998,240 39.5 2,122,635 47.5 2,006,000 41.2 1,496,272 42.5 1,461,452 40.6
Labor expense /H1118 398,270 15.8 611,157 13.7 690,984 14.2 473,389 13.4 624,265 17.3
Electricity
fees /H1118/H1118/H1118/H1118/H1118151,639 6.0 225,787 5.0 352,709 7.2 215,123 6.1 247,340 6.9
Depreciation
and
amortization /H1118 411,005 16.3 1,033,836 23.1 1,322,323 27.2 979,508 27.8 902,241 25.1
Others /H1118/H1118/H1118/H1118/H1118565,967 22.4 478,453 10.7 496,062 10.2 357,571 10.2 365,517 10.1
Total /H1118/H1118/H1118/H1118/H1118/H11182,525,121 100.0 4,471,868 100.0 4,868,078 100.0 3,521,863 100.0 3,600,815 100.0
Note:
1. “Others” primarily includes contractor expenses, construction expenses, service expenses, safety measure
expenses and repair expenses.
The following table sets forth a breakdown of our cost of sales by business nature for the
periods indicated:
Y ear Ended December 31, Nine Months Ended September 30,
2021 2022 2023 2023 2024
RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 %
(unaudited)
Gold mining /H1118/H11182,099,996 83.2 3,838,923 85.8 4,065,599 83.5 2,988,432 84.9 3,053,075 84.8
Other Mineral
Resources /H1118/H1118215,467 8.5 370,829 8.3 430,841 8.9 308,075 8.7 362,412 10.1
Others /H1118/H1118/H1118/H1118/H1118209,658 8.3 262,116 5.9 371,638 7.6 225,356 6.4 185,328 5.1
Total /H1118/H1118/H1118/H1118/H1118/H11182,525,121 100.0 4,471,868 100.0 4,868,078 100.0 3,521,863 100.0 3,600,815 100.0
Note:
1. “Others” primarily includes contractor expenses, construction expenses, service expenses, safety measure
expenses and repair expenses.
FINANCIAL INFORMATION
– 489 –


--- page 501 ---
The following table sets forth a breakdown of our cost of sales by origin of our products
for the periods indicated:
Y ear Ended December 31, Nine Months Ended September 30,
2021 2022 2023 2023 2024
RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 %
(unaudited)
PRC /H1118/H1118/H1118/H1118/H1118/H1118667,950 26.5 808,810 18.1 994,926 20.4 589,763 16.7 751,221 20.9
Laos /H1118/H1118/H1118/H1118/H1118/H11181,857,171 73.5 2,446,054 54.7 2,383,654 49.0 1,834,599 52.1 1,586,325 44.0
Ghana 1 /H1118/H1118/H1118/H1118/H1118– – 1,217,004 27.2 1,489,498 30.6 1,097,501 31.2 1,263,269 35.1
Total /H1118/H1118/H1118/H1118/H1118/H11182,525,121 100.0 4,471,868 100.0 4,868,078 100.0 3,521,863 100.0 3,600,815 100.0
Note:
1. Our cost of sales in Ghana was generated from Golden Star Resources. In January 2022, we acquired a 62%
equity interest in Golden Star Resources, which in turn indirectly holds a 90% equity interest in GSWL, and
we began consolidating the accounts of Golden Star Resources from February 1, 2022. As such, the cost of
sales of GSWL prior to February 1, 2022 was not included in our Group. For more details, please see “— Key
Factors Affecting Our Results of Operations — Acquisitions — Acquisition of Golden Star Resources”.
Gross Profit and Gross Profit Margin
Our gross profit consists of revenue less cost of sales. Gross profit margin represents
gross profit divided by total revenue, expressed as a percentage. For the years ended December
31, 2021, 2022 and 2023 and the nine months ended September 30, 2023 and 2024, our gross
profit amounted to RMB1,257.5 million, RMB1,794.9 million, RMB2,352.9 million,
RMB1,540.4 million and RMB2,622.0 million, respectively. The following table sets forth a
breakdown of our gross profit and gross profit margin by business nature for the periods
indicated:
Y ear Ended December 31, Nine Months Ended September 30,
2021 2022 2023 2023 2024
Gross
Profit
Gross
Profit
Margin
Gross
Profit
Gross
Profit
Margin
Gross
Profit
Gross
Profit
Margin
Gross
Profit
Gross
Profit
Margin
Gross
Profit
Gross
Profit
Margin
RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 %
(unaudited)
Gold mining /H1118/H1118868,698 29.3 1,465,806 27.6 2,256,664 35.7 1,482,144 33.2 2,508,183 45.1
Other Mineral
Resources /H1118/H1118335,811 60.9 279,377 43.0 64,911 13.1 27,259 8.1 91,720 20.2
Others /H1118/H1118/H1118/H1118/H111852,994 20.2 49,736 15.9 31,299 7.8 31,027 12.1 22,113 10.7
Total /H1118/H1118/H1118/H1118/H1118/H11181,257,503 33.2 1,794,919 28.6 2,352,874 32.6 1,540,430 30.4 2,622,016 42.1
FINANCIAL INFORMATION
– 490 –


--- page 502 ---
Gross margins for different types of products are significantly different during the Track
Record Period, primarily because (i) different products have different selling prices attributable
to their intrinsic market values, driven by their respective supply and demand; (ii) different
products incur different cost of sales. For example, despite higher cost of sales, gold mining
achieved higher gross profit margin during the Track Record Period due to its inherent pricing
advantage and the benefit from economies of scale at a high production volume.
The following table sets forth a breakdown of our gross profit and gross profit margin by
origin of our products for the periods indicated:
Y ear Ended December 31, Nine Months Ended September 30,
2021 2022 2023 2023 2024
Gross
Profit
Gross
Profit
Margin
Gross
Profit
Gross
Profit
Margin
Gross
Profit
Gross
Profit
Margin
Gross
Profit
Gross
Profit
Margin
Gross
Profit
Gross
Profit
Margin
RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 %
(unaudited)
PRC /H1118/H1118/H1118/H1118/H1118/H1118591,738 47.0 668,660 45.3 1,031,907 50.9 711,633 54.7 1,042,153 58.1
Laos /H1118/H1118/H1118/H1118/H1118/H1118665,765 26.4 552,686 18.4 670,960 22.0 404,807 18.1 741,141 31.8
Ghana 1 /H1118/H1118/H1118/H1118/H1118– – 573,573 32.0 650,007 30.4 423,990 27.9 838,722 39.9
Total /H1118/H1118/H1118/H1118/H1118/H11181,257,503 33.2 1,794,919 28.6 2,352,874 32.6 1,540,430 30.4 2,622,016 42.1
Note:
1. Our gross profit in Ghana was generated from Golden Star Resources. In January 2022, we acquired a 62%
equity interest in Golden Star Resources, which in turn indirectly holds a 90% equity interest in GSWL, and
we began consolidating the accounts of Golden Star Resources from February 1, 2022. As such, the gross profit
of GSWL prior to February 1, 2022 was not included in our Group. For more details, please see “— Key
Factors Affecting Our Results of Operations — Acquisitions — Acquisition of Golden Star Resources”.
Gross margins for different origins of our products are significantly different during the
Track Record Period, primarily because: (i) cost of sales of overseas gold mining business is
higher than that of the PRC gold mining business, attributable to (a) higher procurement cost
of our overseas gold mining business compared to our PRC gold mining business; (b)
amortization of mining rights associated with revaluation of overseas mines acquired in recent
years, leading to an increase in unit cost of sales; and (c) higher “other” expenses including
contractor expenses, construction expenses, service expenses, safety measure expenses, and the
repair expenses of overseas mines compared to the PRC mines; and (ii) the average selling
price of overseas gold mining business is lower than that of the PRC gold mining business. To
further drive cost efficiency, we have adopted global centralized procurement system, which
primarily benefits our overseas gold mines.
FINANCIAL INFORMATION
– 491 –


--- page 503 ---
Other income and gains
Our other income and gains mainly represent government grants, gains on changes of fair
value of financial assets at fair value through profit or loss, gains on changes of fair value of
derivative financial instruments, gains on disposal of financial assets at fair value through
profit or loss, gains on disposal of financial assets at fair value through profit or loss, finance
income and others. For the years ended December 31, 2021, 2022 and 2023 and the nine
months ended September 30, 2023 and 2024, our other income and gains amounted to
RMB90.5 million, RMB142.1 million, RMB137.8 million, RMB90.6 million and RMB272.0
million respectively. The following table sets forth a breakdown of our other income and gains
for the periods indicated:
Y ear Ended December 31, Nine Months Ended September 30,
2021 2022 2023 2023 2024
RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 %
(unaudited)
Government grants /H1118/H1118/H1118/H1118/H1118/H11181,363 1.5 4,045 2.8 16,950 12.3 1,227 1.4 768 0.3
Gains on changes in fair
value of financial assets at
fair value through profit
or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,415 1.6 17,918 12.6 – –– – – –
Gains on changes in fair
value of derivative
financial instruments /H1118/H1118/H1118 – – 584 0.4 13,470 9.8 33,665 37.1 29,383 10.8
Gains on disposal of
derivative financial
instruments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825,014 27.6 82,913 58.4 75,343 54.7 34,937 38.5 143,446 52.7
Gains on disposal of
investment in an associate – – – – – – – – 71,119 26.2
Gains on disposal of
financial assets at fair
value through profit or
loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – – 4,226 3.1 – –– –
Finance income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820,439 22.6 28,097 19.8 26,322 19.1 19,644 21.7 26,197 9.6
Gain on recognition of
negative goodwill /H1118/H1118/H1118/H1118/H1118– – 6,371 4.5 – – – – – –
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111842,281 46.7 2,160 1.5 1,459 1.0 1,135 1.3 1,072 0.4
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111890,512 100.0 142,088 100.0 137,770 100.0 90,608 100.0 271,985 100.0
Finance income mainly represent interest on fixed deposits and interest on demand
deposits.
Gains on changes in fair value of derivative financial instruments primarily comprise of
gains and losses arising from fair value changes of gold lease hedging instruments.
FINANCIAL INFORMATION
– 492 –


--- page 504 ---
Gains on changes on disposal of derivative financial instruments primarily represents
investment income from the disposal of gold lease hedging instruments.
Selling and distribution expenses
Our selling and distribution expenses primarily consist of labor expenses, traveling
expenses, consumption of materials, warrants and licenses, depreciation, operating expenses,
and others. For the years ended December 31, 2021, 2022 and 2023 and the nine months ended
September 30, 2023 and 2024, our selling and distribution expenses amounted to RMB0.8
million, RMB0.7 million, RMB0.7 million, RMB0.5 million and RMB0.3 million respectively.
Administrative Expenses
Our administrative expenses primarily consist of taxes and levies on operations, labor
expenses, professional service expenses, office and traveling expenses, depreciation and
amortization, lease expenses, insurance premium, entertainment expenses, environmental
protection expenses, consumption of materials, and others.
Taxes and levies on operations mainly represent resources tax. For the details of the taxes
and royalties that we are subject to, see the section headed “Regulatory Overview” in this
Prospectus.
The following table sets forth a breakdown of our administrative expenses for the periods
indicated:
Y ear Ended December 31, Nine Months Ended September 30,
2021 2022 2023 2023 2024
RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 %
(unaudited)
Taxes and Levies
on Operations /H1118/H1118/H1118/H1118/H1118/H1118/H1118157,753 40.1 283,984 36.1 389,018 45.7 282,672 45.4 330,436 50.7
Labor expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118133,998 34.1 240,742 30.6 253,728 29.8 175,332 28.1 180,214 27.6
Professional service
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111830,537 7.8 98,498 12.5 51,402 6.0 43,989 7.1 42,903 6.6
Office and traveling
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825,797 6.6 59,576 7.6 56,070 6.6 40,884 6.6 35,382 5.4
Depreciation and
amortization /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111827,171 6.9 49,498 6.3 47,886 5.6 38,954 6.3 25,744 3.9
Lease expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,043 1.0 20,766 2.6 15,975 1.9 9,895 1.5 8,818 1.4
Insurance premium /H1118/H1118/H1118/H1118/H1118/H1118563 0.1 16,410 2.1 13,710 1.6 12,007 1.9 10,636 1.6
Entertainment expenses /H1118/H1118/H11183,457 0.9 3,901 0.5 5,007 0.6 3,635 0.6 3,015 0.5
Environmental protection
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,546 0.6 2,693 0.3 747 0.1 498 0.1 652 0.1
FINANCIAL INFORMATION
– 493 –


--- page 505 ---
Y ear Ended December 31, Nine Months Ended September 30,
2021 2022 2023 2023 2024
RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 %
(unaudited)
Consumption of materials /H1118/H11184,950 1.3 2,490 0.3 3,341 0.4 2,432 0.4 2,384 0.4
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,220 0.6 7,810 1.1 13,506 1.7 12,551 2.0 11,715 1.8
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118393,035 100.0 786,368 100.0 850,390 100.0 622,849 100 651,899 100.0
The following table sets forth a breakdown of our taxes and levies on operations for the
periods indicated:
Y ear Ended December 31, Nine Months Ended September 30,
2021 2022 2023 2023 2024
(RMB’000, except percentages)
(unaudited)
PRC /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111846,628 54,236 106,770 90,971 95,756
Laos /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118111,125 134,222 152,605 100,621 118,791
Ghana /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 95,526 129,643 91,080 115,889
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118157,753 283,984 389,018 282,672 330,436
Research and Development Expenses
Our research and development expenses mainly include labor expenses, power expenses,
materials expenses, depreciation, test fee for trial produced products, expert consulting fees,
and others. For the years ended December 31, 2021, 2022 and 2023 and the nine months ended
September 30, 2023 and 2024, our research and development expenses amounted to RMB24.8
million, RMB27.7 million, RMB51.8 million, RMB25.0 million and RMB47.9 million
respectively. The table below sets forth a breakdown of our research and development expenses
by nature for the years indicated:
Y ear Ended December 31, Nine Months Ended September 30,
2021 2022 2023 2023 2024
RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 %
(unaudited)
Labor expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,735 43.2 9,676 35.0 23,334 45.1 10,252 41.1 24,498 51.2
Power expenses /H1118/H1118/H1118/H1118/H1118/H1118/H11183,916 15.8 6,224 22.5 12,772 24.7 4,598 18.4 5,893 12.3
Materials expenses /H1118/H1118/H1118/H1118/H1118/H11182,158 8.7 6,035 21.8 8,372 16.2 6,542 26.2 9,539 19.9
Depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,546 14.3 3,056 11.1 4,609 8.9 2,476 9.9 5,264 11.0
Test fee for trial produced
products /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 510 1.8 603 1.2 241 1.0 1,012 2.1
Expert consulting fees /H1118/H1118/H1118/H11182,434 9.8 – –– –– –– –
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,058 8.2 2,151 7.8 2,063 3.9 843 3.4 1,687 3.5
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111824,847 100.0 27,652 100.0 51,753 100.0 24,952 100.0 47,893 100.0
FINANCIAL INFORMATION
– 494 –


--- page 506 ---
Impairment losses on financial assets, net
Our net impairment losses on financial assets mainly include impairment losses on
account receivable and impairment losses on other receivable. For the years ended December
31, 2021, 2022 and 2023 and the nine months ended September 30, 2023 and 2024, our net
impairment losses on financial assets amounted to RMB2.0 million, RMB0.6 million, RMB2.4
million, RMB1.1 million and gain of RMB1.6 million respectively. The table below sets forth
a breakdown of our net impairment losses on financial assets for the years indicated:
Y ear Ended December 31,
Nine Months Ended
September 30,
2021 2022 2023 2023 2024
(RMB’000)
(unaudited)
(Impairment
losses)/reversal of
impairment on account
receivable /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(778) 158 442 460 18
Impairment losses on
other receivable /H1118/H1118/H1118/H1118/H1118/H1118(1,206) (802) (2,882) (1,579) 1,606
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,984) (644) (2,440) (1,119) 1,624
Other expenses and losses
Our other expenses and losses mainly include donations, loss on disposal of non-current
assets, loss on derecognition of financial liabilities, loss on changes in fair value of financial
liabilities at fair value through profit or loss, loss on changes in fair value of financial assets
at fair value through profit or loss, impairment losses/(reversal of impairment losses) on
inventories, foreign exchanges and others. For the years ended December 31, 2021, 2022 and
2023 and the nine months ended September 30, 2023 and 2024, our other expenses and losses
amounted to RMB142.8 million, RMB119.0 million, RMB173.5 million, RMB86.8 million and
RMB189.9 million respectively. The loss on derecognition of financial liabilities increased
from RMB10.9 million in 2021 to RMB17.2 million in 2022, and further to RMB76.0 million
in 2023, and from RMB55.9 million in the nine months ended September 30, 2023 to
RMB107.4 million in the nine months ended September 30, 2024. These changes were
primarily due to the year-on-year increases in the scale of gold leasing conducted by us,
coupled with the overall upward trend in gold prices. The loss on changes in fair value of
financial liabilities at fair value through profit or loss increased from RMB3.1 million in 2021
to RMB30.4 million in 2022, and further to RMB63.4 million in 2023, and from RMB23.3
million in the nine months ended September 30, 2023 to RMB83.3 million in the nine months
ended September 30, 2024. The changes were also primarily due to the year-on-year increases
in the scale of gold leasing conducted by us, coupled with the overall upward trend in gold
prices.
FINANCIAL INFORMATION
– 495 –


--- page 507 ---
We did not record any loss on changes in fair value of financial assets at fair value
through profit or loss in 2021 and 2022, as we recognized rises in the share prices of our equity
investments under “gains on changes in fair value of financial assets at fair value through profit
or loss” recorded under “other income and gains.” We recognized RMB21.4 million, RMB19.7
million and RMB3.2 million of loss on changes in fair value of financial assets at fair value
through profit or loss in 2023, the nine months ended September 30, 2023 and 2024,
respectively, primarily due to the declines in the fair value of our equity investments
attributable to decreases in share prices.
The impairment losses on inventories was RMB191.6 million in 2021 and RMB41.7
million in 2022, primarily because LXML experienced a high stripping ratio and low recovery
rate, which collectively led to elevated mining costs. At the end of 2021 and 2022, the carrying
values of semi-finished goods and finished goods of gold products exceeded their recoverable
amounts, resulting in impairment losses being recognised on certain semi-finished goods and
finished goods of gold products. The impairment losses on inventories decreased to RMB3.5
million in 2023, primarily due to the rapid and significant increases in gold prices, which
reduced the impairments on inventories of gold products. We recorded reversal of impairment
on inventories of RMB18.0 million in the nine months ended September 30, 2023, compared
to impairment losses on inventories of RMB7.2 million in the nine months ended September
30, 2024, primarily due to the inventory impairments relating to the molybdenum products of
Hanfeng Mining, driven by low molybdenum prices as well as aging or obsolete raw materials.
The table below sets forth a breakdown of our other expenses and losses for the years
indicated:
Y ear Ended December 31,
Nine Months Ended
September 30,
2021 2022 2023 2023 2024
(RMB’000)
(unaudited)
Donations /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815,100 940 222 12 690
Loss on disposal of non-
current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,060 2,632 1,853 1,388 367
Loss on derecognition of
financial liabilities (1) /H1118/H1118/H111810,856 17,249 76,018 55,930 107,426
Loss on changes in fair
value of financial
liabilities at fair
value through profit
or loss
(2) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,111 30,416 63,428 23,308 83,256
FINANCIAL INFORMATION
– 496 –


--- page 508 ---
Y ear Ended December 31,
Nine Months Ended
September 30,
2021 2022 2023 2023 2024
(RMB’000)
(unaudited)
Loss on changes in fair
value of financial assets
at fair value through
profit or loss
(3) /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 21,385 19,713 3,221
Impairment
losses/(reversal of
impairment) on
inventories
(4) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118191,615 41,723 3,516 (18,038) 7,251
Foreign exchange /H1118/H1118/H1118/H1118/H1118/H1118/H1118(86,237) (27,244) (20,157) (18,855) (27,781)
Other /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,255 53,306 27,236 23,311 15,475
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118142,760 119,022 173,501 86,769 189,905
Notes:
(1) Loss on derecognition of financial liabilities refers to the investment loss incurred when we engage in
gold leasing business and repay gold at maturity due to the increase in gold prices.
(2) Loss on changes in fair value of financial liabilities at fair value through profit or loss refers to the fair
value change loss arising from the increase in gold prices at each balance sheet date when we engage
in gold leasing business.
(3) Loss on changes in fair value of financial assets at fair value through profit or loss refers to the fair value
change loss of our equity investments.
(4) The impairment losses/(reversal of impairment) on inventories during the Track Record Period was
primarily attributable to: (i) impairment provisions for semi-finished products or finished goods due to
fluctuations in market prices; and (ii) impairment provisions for spare parts due to extended storage
periods or obsolescence.
FINANCIAL INFORMATION
– 497 –


--- page 509 ---
Finance costs
Our finance costs primarily consist of interest on loans, interest on gold lease
arrangements, interest on metal streaming arrangement, amortization of unrecognized
financing expenses of mining rights, accretion of interest of provisions and interest on lease
liabilities. For the years ended December 31, 2021, 2022 and 2023 and the nine months ended
September 30, 2023 and 2024, our finance costs amounted to RMB14.2 million, RMB176.5
million, RMB215.0 million, RMB143.3 million and RMB164.8 million respectively. The table
below sets forth a breakdown of our financial costs by nature for the years indicated:
Y ear Ended December 31,
Nine Months Ended
September 30,
2021 2022 2023 2023 2024
(RMB’000)
(unaudited)
Interest on loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,870 127,797 159,621 102,319 106,868
Interest on gold lease
arrangements /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,793 10,396 14,797 11,976 18,771
Interest on metal
streaming arrangement /H1118 – 15,393 15,093 12,473 21,059
Amortization of
unrecognized finance
expenses of mining
rights /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 3,793 3,766 2,938 2,717
Accretion of interest of
provisions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,393 8,895 9,409 6,468 7,075
Interest on lease
liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118170 10,211 12,340 7,116 8,283
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814,226 176,485 215,026 143,290 164,773
Income tax expenses
For the years ended December 31, 2021, 2022 and 2023 and the nine months ended
September 30, 2023 and 2024, our income tax expenses amounted to RMB157.0 million,
RMB328.1 million, RMB335.2 million, RMB196.2 million and RMB583.3 million
respectively.
Our income tax expense consists of current income tax and deferred income tax. Current
income tax comprises PRC enterprise income tax (“ EIT”), Hong Kong profit tax, Laos
corporate income tax and Ghana corporate income tax. Our effective income tax rate,
calculated as income tax expense divided by profit before taxation, was 20.4%, 39.9%, 27.8%,
25.9% and 31.6% for the years ended December 31, 2021, 2022 and 2023 and the nine months
ended September 30, 2023 and 2024, respectively.
FINANCIAL INFORMATION
– 498 –


--- page 510 ---
For the year ended December 31, 2021, the effective income tax rate was 20.4%, mainly
due to the decrease in the income tax expense in 2021 by RMB29.5 million as a result of the
preferential tax treatment received by Jilong Mining in 2021.
For the year ended December 31, 2022, the effective income tax rate was 39.9%, mainly
due to (i) new acquisition of Golden Star Resources in 2022; (ii) increase in the income tax
expense in 2022 by RMB9.8 million as a result of adjustments in respect of current tax of
previous periods; and (iii) unrecognized deductible temporary differences and losses of
RMB32.1 million.
For the year ended December 31, 2023, the effective income tax rate was 27.8%, mainly
due to the significant increase in the profit before tax of our PRC mining business as a
percentage of our total profit before tax and lower corporate income tax rate in the PRC
compared to overseas jurisdictions where we operate.
For the nine months ended September 30, 2023, the effective income tax rate was 25.9%,
mainly due to a decrease in the income tax expense by RMB10.3 million in the nine months
ended September 30, 2023, attributable to the impact from tax losses utilized from previous
periods.
For the nine months ended September 30, 2024, the effective tax rate was 31.6%, mainly
due to an increase in the income tax expense by RMB54.1 million, attributable to the impact
from transfer pricing audit for the years ended December 31, 2017 through December 31, 2020.
Please refer to “Business — Transfer Pricing” for more details.
The following table sets forth a breakdown of our income tax expense for the periods
indicated:
Y ear Ended December 31,
Nine Months Ended
September 30,
2021 2022 2023 2023 2024
(RMB’000)
(unaudited)
Current income tax
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118118,260 279,252 480,868 299,342 663,861
Deferred income tax
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111838,707 48,880 (145,658) (103,108) (80,595)
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118156,967 328,132 335,210 196,234 583,266
FINANCIAL INFORMATION
– 499 –


--- page 511 ---
During the Track Record Period, our Company and subsidiaries in the PRC were subject
to the statutory EIT rate of 25%, in accordance with the relevant tax rules and regulations.
Pursuant to the PRC Corporate Income Tax Law, certain subsidiaries of our Group, namely
Jilong Mining and Wulong Mining, were certified as “High and New Technology Enterprises”
by the relevant tax authorities in the PRC. Also, EIT Policies for Large-scale Development in
the Western Region are applicable to Jintai Mining and Hanfeng Mining, both of which have
enjoyed a preferential income tax rate of 15% during the Track Record Period.
We were not subject to any income, estate, corporation, capital gains or other tax in the
Cayman Islands pursuant to the local tax rules and regulations during the Track Record Period.
Our subsidiary incorporated in Hong Kong was subject to the Hong Kong profit tax rate
of 16.5% during the Track Record Period.
Our subsidiary incorporated in Laos was subject to the Laos corporate income tax rate of
33.3% during the Track Record Period.
Our subsidiary incorporated in Ghana was subject to the Ghana corporate income tax rate
of 35.0% for mining and upstream petroleum companies during the Track Record Period.
During the Track Record Period, we paid all relevant taxes that were due and applicable
to us and had no disputes or, to the best of our knowledge, unresolved material tax issues with
relevant tax authorities.
PERIOD TO PERIOD COMPARISON OF RESULTS OF OPERATIONS
Nine Months Ended September 30, 2024 Compared to the Nine Months Ended
September 30, 2023
Revenue
Our revenue increased by 22.9% from RMB5,062.3 million for the nine months ended
September 30, 2023 to RMB6,222.8 million for the nine months ended September 30, 2024.
This increase was mainly due to an overall increase in revenue of our gold mining business.
By business nature
The revenue of our gold mining business increased by 24.4% from RMB4,470,6 million
for the nine months ended September 30, 2023 to RMB5,561.3 million for the nine months
ended September 30, 2024. This was mainly due to the increase in average selling prices of our
gold products. We experienced an increase in average selling prices for our gold product
increased by 18.5% from approximately RMB427.0 per gram for the nine months ended
September 30, 2023 to RMB506.2 per gram for the nine months ended September 30, 2024.
The increase was generally in line with the increase in the gold price globally during the same
period.
FINANCIAL INFORMATION
– 500 –


--- page 512 ---
The revenue of our other Mineral Resources business increased by 35.4% from
RMB335.3 million for the nine months ended September 30, 2023 to RMB454.1 million for the
nine months ended September 30, 2024. This was mainly due to the resumption of production
at Hanfeng Mining.
The revenue of other businesses decreased by 19.1% from RMB256.4 million for the nine
months ended September 30, 2023 to RMB207.4 million for the nine months ended September
30, 2024. This was mainly due to the (i) the decreased market price of Guangyuan
Technology’s main disassembly products, such as plastic and scrap metal alloys, and
(ii) decreased amount of main disassembly products we sold through Guangyuan Technology.
By origin of our products
Revenue generated from our PRC operations increased by 37.8% from RMB1,301.4
million for the nine months ended September 30, 2023 to RMB1,793.4 million for the nine
months ended September 30, 2024.
This was primarily due to: (i) the increased gold sales volume of our PRC Mines from
72.0 koz for the nine months ended September 30, 2023 to 81.8 koz for the nine months ended
September 30, 2024; and (ii) the increase in average gold selling prices of our PRC Mines sold
their gold products for, which was in line with the overall increase in gold price during this
period in China. The average selling price for our gold product in the PRC increased from
approximately RMB448.0 per gram for the nine months ended September 30, 2023 to
RMB540.9 per gram for the nine months ended September 30, 2024.
Revenue generated from our overseas operations increased by 17.8% from RMB3,760.9
million for the nine months ended September 30, 2023 to RMB4,429.5 million for the nine
months ended September 30, 2024. This was mainly due to the increase in average selling
prices for our gold product. The average selling prices for our overseas gold product increased
from approximately RMB421.3 per gram for the nine months ended September 30, 2023 to
RMB495.7 per gram for the nine months ended September 30, 2024.
Cost of sales
Our cost of sales increased by 2.2% from RMB3,521.9 million for the nine months ended
September 30, 2023 to RMB3,600.8 million for the nine months ended September 30, 2024.
This was mainly due to increases in the cost of sales of our gold mining business as a result
of our increase in sales volume of gold.
By business nature
The cost of sales of our gold mining business increased by 2.2% from RMB2,988.4
million for the nine months ended September 30, 2023 to RMB3,053.1 million for the nine
months ended September 30, 2024. This was mainly due to: (i) increased gold sales volume
from 336 koz for the nine months ended September 30, 2023 to 352 koz for the nine months
ended September 30, 2024; and (ii) rising raw material expenses.
FINANCIAL INFORMATION
– 501 –


--- page 513 ---
Our cost of sales of our other Mineral Resources business increased by 17.6% from
RMB308.1 million for the nine months ended September 30, 2023 to RMB362.4 million for the
nine months ended September 30, 2024. This was mainly due to (i) the increased sales volume
of Hanfeng Mining’s non-ferrous metal products, including copper, lead, zinc, and
molybdenum; and (ii) the increased processed volume of LXML’s copper and the decreased
grade.
The cost of sales of other business decreased by 17.8% from RMB225.4 million for the
nine months ended September 30, 2023 to RMB185.3 million for the nine months ended
September 30, 2024. This was mainly due to our adjustment of the volume of disassembled
waste household appliances that qualify for government subsidy given the uncertainty in the
evolving government policy on subsidies.
By origin of our products
The cost of sales of our PRC operations increased by 27.4% from RMB589.8 million for
the nine months ended September 30, 2023 to RMB751.2 million for the nine months ended
September 30, 2024. This was primarily due to: (i) increased material expenses in line with
increase in sales volume of gold from 72.0 koz for the nine months ended September 30, 2023
to 81.8 koz for the nine months ended September 30, 2024; (ii) an increased cost of raw
materials in line with the increased sales volume of zinc concentrate powder and lead
concentrate powder of Hanfeng Mining due to increase in sales volume and material price; and
(iii) low ore grade, the gold which led to increased cost during processing.
The cost of sales of our overseas operations decreased by 2.8% from RMB2,932.1 million
for the nine months ended September 30, 2023 to RMB2,849.6 million for the nine months
ended September 30, 2024, primarily attributable to our cost-cutting measures in 2024.
Gross Profit and Gross Profit Margin
Our gross profit increased by 70.2% from RMB1,540.4 million for the nine months ended
September 30, 2023 to RMB2,622.0 million for the nine months ended September 30, 2024.
Our gross profit margin increased from 30.4% for the nine months ended September 30, 2023
to 42.1% for the nine months ended September 30, 2024. This was mainly due to the increase
of revenue of gold mining business arising from the increase in the average selling prices for
our gold product from approximately RMB427.0 per gram for the nine months ended
September 30, 2023 to RMB506.2 per gram for the nine months ended September 30, 2024.
By business nature
The gross profit of our gold mining business increased by 69.2% from RMB1,482.1
million for the nine months ended September 30, 2023 to RMB2,508.2 million for the nine
months ended September 30, 2024. The gross profit margin of our gold mining business
increased from 33.2% for the nine months ended September 30, 2023 to 45.1% for the nine
months ended September 30, 2024. This was mainly due to the increase in the gold selling price
increased from RMB427.0 per gram for the nine months ended September 30, 2023 to
RMB506.2 per gram for the nine months ended September 30, 2024.
FINANCIAL INFORMATION
– 502 –


--- page 514 ---
The gross profit of our other Mineral Resources business increased by 236.5% from
RMB27.3 million for the nine months ended September 30, 2023 to RMB91.7 million for the
nine months ended September 30, 2024. The gross profit margin of our other Mineral
Resources business increased from 8.1% for the nine months ended September 30, 2023 to
20.2% for the nine months ended September 30, 2024. This was mainly due to (i) the increase
in the production capacity of non-ferrous metals and (ii) the decrease in unit sales costs
attributable to the increased scale of production and sales of copper, lead, zinc, and
molybdenum.
The gross profit of our other business decreased from RMB31.0 million for the nine
months ended September 30, 2023 to RMB22.1 million for the nine months ended September
30, 2024. The gross profit margin of our resource recycling business decreased from 12.1% for
the nine months ended September 30, 2023 to 10.7% for the nine months ended September 30,
2024. This was mainly due to the decreased disassembly volume.
By origin of our products
The gross profit margin of our PRC operations increased slightly from 54.7% for the nine
months ended September 30, 2023 to 58.1% for the nine months ended September 30, 2024.
This was mainly due to the gold selling price increased from approximately RMB448.0 per
gram for the nine months ended September 30, 2023 to RMB540.9 per gram for the nine
months ended September 30, 2024. This was partially offset by the increase in the cost of sales
from RMB589.8 million for the nine months ended September 30, 2023 to RMB751.2 million
for the nine months ended September 30, 2024.
The gross profit margin of our overseas operations increased from 22.0% for the nine
months ended September 30, 2023 to 35.7% for the nine months ended September 30, 2024.
This was mainly due to (i) an increase in the gold selling price from approximately RMB421.3
per gram for the nine months ended September 30, 2023 to RMB495.7 per gram for the nine
months ended September 30, 2024 and (ii) a decrease in the cost of sales of our overseas
operations by 2.8% from RMB2,932.1 million for the nine months ended September 30, 2023
to RMB2,849.6 million for the nine months ended September 30, 2024.
Other income and gains
Our other income and gains increased significantly by 200.2% from RMB90.6 million for
the nine months ended September 30, 2023 to RMB272.0 million for the nine months ended
September 30, 2024. This was primarily due to: (i) an increase in gains on disposal of
derivative financial instruments of RMB108.5 million; and (ii) an increase in gains on disposal
of investment in an associate of RMB71.1 million.
FINANCIAL INFORMATION
– 503 –


--- page 515 ---
Our gains on disposal of derivative financial instruments increased significantly by
310.6% from RMB34.9 million for the nine months ended September 30, 2023 to RMB143.4
million for the nine months ended September 30, 2024. This was primarily because Jilong
Mining conducted hedging business for gold leasing, purchased gold futures contracts, and
recorded an investment income of RMB143.4 million from disposal of hedging instruments in
2024.
Our finance income increased significantly by 33.4% from RMB19.6 million for the nine
months ended September 30, 2023 to RMB26.2 million for the nine months ended September
30, 2024. This was primarily due to an increase in Chijin Xiawu’s bank deposits in the nine
months ended September 30, 2024 compared to the same period in 2023, resulting in an
increase in bank deposit interest income.
Selling and distribution expenses
Our selling expenses and distribution expenses decreased by 40.0% from RMB0.53
million for the nine months ended September 30, 2023 to RMB0.32 million the nine months
ended September 30, 2024. This was primarily due to a decrease in salary and travel expenses
of the sales department.
Administrative expenses
Our administrative expenses increased by 5.0% from RMB622.8 million for the nine
months ended September 30, 2023 to RMB651.9 million for the nine months ended
September 30, 2024. This was primarily due to inflation and the increase in labor costs,
including wages and salaries, welfare expenses, social insurance, and other human resource
expenses, as well as the increase in intermediary agency fees.
Research and development expenses
Our research and development expenses increased by 91.9% from RMB25.0 million for
the nine months ended September 30, 2023, to RMB47.9 million for the nine months ended
September 30, 2024. This was primarily due to the increase in the number of research and
development projects on Jilong Mining’s new geothermal mitigation technologies,
underground mining-induced ground pressure disasters, and control methodologies, leading to
a corresponding increase in research and development expenses.
Impairment losses on financial assets, net
We recorded net impairment losses on financial assets of RMB1.1 million for the nine
months ended September 30, 2023, while we recorded net reversal of impairment on financial
assets of RMB1.6 million for the nine months ended September 30, 2024. This was primarily
due to the reversal of credit losses that had been provided for in 2023.
FINANCIAL INFORMATION
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--- page 516 ---
Other expenses and losses
Our other expenses and losses increased by 118.9% from RMB86.8 million for the nine
months ended September 30, 2023 to RMB189.9 million for the nine months ended September
30, 2024. This was primarily due to (i) an increase in loss on derecognition of financial
liabilities of RMB51.5 million arising from our gold leasing transactions. and (ii) an increase
in the loss on changes in fair value of financial liabilities at fair value through profit or loss
of RMB59.9 million. This was partially offset by the decrease in the loss on changes in fair
value of financial assets at fair value through profit or loss of RMB16.5 million.
Financial costs
Our financial costs increased by 15.0% from RMB143.3 million for the nine months
ended September 30, 2023 to RMB164.8 million for the nine months ended September 30,
2024. This was primarily due to (i) an increase in interests on gold lease arrangements of
RMB6.8 million arising from the new gold lease transactions for the nine months ended
September 30, 2024; (ii) an increase in interest on loans of RMB4.5 million; and (iii) an
increase of the interest on metal streaming arrangement of RMB8.6 million.
Share of (losses)/gain of associates
We recorded share of losses of associates of RMB6.7 million for the nine months ended
September 30, 2023, while we recorded share of profits of associates of RMB7.2 million for
the nine months ended September 30, 2024. This was primarily due to changes in our
investment in an associate, namely, Tietto Minerals Limited, as a result of the changes in its
net profit generated from our disposal of Tietto Minerals Limited.
Profit before tax
Our profit before tax increased by 143.7% from RMB758.3 million for the nine months
ended September 30, 2023 to RMB1,848.0 million for the nine months ended September 30,
2024. This was primarily due to (i) the increase in the sales volume of our gold mines; and (ii)
the increase in selling prices of our gold products.
Income tax expenses
Our income tax expenses increased by 197.2% from RMB196.2 million for the nine
months ended September 30, 2023 to RMB583.3 million for the nine months ended September
30, 2024. This was in line with the increase of profit before tax.
FINANCIAL INFORMATION
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--- page 517 ---
Y ear Ended December 31, 2023 Compared to Y ear Ended December 31, 2022
Revenue
Our revenue increased by 15.2% from RMB6,266.8 million for the year ended December
31, 2022 to RMB7,221.0 million for the year ended December 31, 2023. This increase was
mainly due to an overall increase in revenue of our gold mining business.
By business nature
The revenue of our gold mining business increased by 19.2% from RMB5,304.7 million
for the year ended December 31, 2022 to RMB6,322.3 million for the year ended December 31,
2023. This was mainly due to (i) the increase in average selling prices; and (ii) The increase
in our gold sales volume from 445 koz in 2022 to 466 koz in 2023. This was primarily due to
the increase in gold production of Wulong Gold Mine and Jilong Gold Mine attributable to the
mine high feed grade in the period and on-schedule steady expansions. We recorded an increase
in average selling prices for our gold product from approximately RMB382.9 per gram in 2022
to RMB435.7 per gram in 2023. The increase was generally in line with the increase in gold
price globally during the same period.
The revenue of other Mineral Resources business decreased by 23.8% from RMB650.2
million for the year ended December 31, 2022 to RMB495.8 million for the year ended
December 31, 2023. This was mainly due to Hanfeng Polymetallic Mine’s suspension of
operations in the first half of 2023 as a result of its safety improvement measures, which
affected its production capacity.
The revenue of other businesses increased by 29.2% from RMB311.9 million for the year
ended December 31, 2022 to RMB402.9 million for the year ended December 31, 2023. This
was mainly due to the increased amount of waste electronic products and electrical appliances
we sold through Guangyuan Technology.
By origin of our products
Revenue generated from our PRC operations increased by 37.2% from RMB1,477.5
million for the year ended December 31, 2022 to RMB2,026.8 million for the year ended
December 31, 2023. This was primarily due to: (i) the increased gold production of Wulong
Gold Mine and Jilong Gold Mine, which was attributed to their respective relatively high-level
gold grades and on-schedule steady expansions; and (ii) higher average selling prices of gold,
which was in line with the overall increase in gold price during this period in China. The
average selling prices for our gold product in the PRC increased from approximately
RMB396.4 per gram in 2022 to RMB455.9 per gram in 2023.
FINANCIAL INFORMATION
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--- page 518 ---
Revenue generated from our overseas operations increased by 8.5% from RMB4,789.3
million for the year ended December 31, 2022 to RMB5,194.1 million for the year ended
December 31, 2023. This reflected: (i) an increase in the average exchange rate of U.S. dollar
against Renminbi in 2023; (ii) the Wassa Gold Mine’s increased sales volume of gold from 157
koz to 166 koz; and (iii) the higher average selling prices for our gold product in 2023. The
average selling prices for our overseas gold product increased from approximately RMB380.2
per gram in 2022 to RMB429.7 per gram in 2023.
Cost of sales
Our cost of sales increased by 8.9% from RMB4,471.9 million for the year ended
December 31, 2022 to RMB4,868.1 million for the year ended December 31, 2023. This was
mainly due to increases in the cost of sales of our gold mining business, as a result of: (i) our
increase in sales volume of gold; and (ii) an increase in materials expenses, which was mainly
due to rising raw material prices and our increased consumption of materials in line with the
increased production volume.
By business nature
The cost of sales of our gold mining business increased by 5.9% from RMB3,838.9
million for the year ended December 31, 2022 to RMB4,065.6 million for the year ended
December 31, 2023. This was mainly due to: (i) increased gold sales volume from 445 koz in
2022 to 467 koz in 2023; and (ii) the rising raw material prices.
The cost of sales of our other Mineral Resources business increased by 16.2% from
RMB370.8 million for the year ended December 31, 2022 to RMB430.8 million for the year
ended December 31, 2023. This was mainly due to: (i) the increased cost of producing copper
cathodes resulting from the growing volume of copper ore processed; and (ii) a decline in
average copper ore grade at Sepon Gold and Copper Mine.
The cost of sales of other business increased by 41.8% from RMB262.1 million for the
year ended December 31, 2022 to RMB371.6 million for the year ended December 31, 2023.
This was mainly due to the increased amount of waste home appliances we dismantled through
Guangyuan Technology.
By origin of our products
The cost of sales of our PRC operations increased from RMB808.8 million for the year
ended December 31, 2022 to RMB994.9 million for the year ended December 31, 2023. This
was primarily due to: (i) increased expenses in line with increase in sales volume of gold as
the gold sales volume was up from 75 koz in 2022 to 107 koz in 2023; (ii) increased costs in
line with the increased sales volume of zinc concentrate powder and lead concentrate powder
of Hanfeng Mining; and (iii) low ore grade of Jilong Mining, which led to increased processing
cost.
FINANCIAL INFORMATION
– 507 –


--- page 519 ---
The cost of sales of our overseas operations increased from RMB3,663.1 million for the
year ended December 31, 2022 to RMB3,873.2 million for the year ended December 31, 2023.
This reflected the increased raw materials prices globally.
Gross Profit and Gross Profit Margin
Our gross profit increased by 31.1% from RMB1,794.9 million for the year ended
December 31, 2022 to RMB2,352.9 million for the year ended December 31, 2023. Our gross
profit margin increased from 28.6% for the year ended December 31, 2022 to 32.6% for the
year ended December 31, 2023. This was mainly due to the increase of revenue of gold mining
business arising from the increase in the average selling prices for our gold product and the cost
of sales was effectively controlled in 2023.
By business nature
The gross profit of our gold mining business increased by 54.0% from RMB1,465.8
million for the year ended December 31, 2022 to RMB2,256.7 million for the year ended
December 31, 2023. The gross profit margin of our gold mining business increased from 27.6%
for the year ended December 31, 2022 to 35.7% for the year ended December 31, 2023. This
was mainly due to the increase of revenue of gold mining business arising from the increase
in the average selling prices for our gold product and the cost of sales was effectively
controlled in 2023.
The gross profit of our other Mineral Resources business decreased by 76.8% from
RMB279.4 million for the year ended December 31, 2022 to RMB64.9 million for the year
ended December 31, 2023. The gross profit margin of our non-ferrous metal mining business
decreased from 43.0% for the year ended December 31, 2022 to 13.1% for the year ended
December 31, 2023.
This was mainly due to Hanfeng Mining’s suspension of operations and a decline in
average copper ore grade at Sepon Gold and Copper Mine.
The gross profit of our other business decreased from RMB49.7 million for the year ended
December 31, 2022 to RMB31.3 million for the year ended December 31, 2023. The gross
profit margin of our resource recycling business decreased from 15.9% for the year ended
December 31, 2022 to 7.8% for the year ended December 31, 2023. This was mainly due to the
changes in national government subsidy standards and the decrease of the number of
disassembled substandard products.
FINANCIAL INFORMATION
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--- page 520 ---
By origin of our products
The gross profit margin of our PRC operations increased slightly from 45.3% for the year
ended December 31, 2022 to 50.9% for the year ended December 31, 2023. This was mainly
due to the increase in the average selling prices of our PRC gold product from approximately
RMB396.4 per gram in 2022 to RMB455.9 per gram in 2023, offset by an increase in the gold
sales volume from 75 koz in 2022 to 107 koz in 2023.
The gross profit margin of our overseas operations increased from 23.5% for the year
ended December 31, 2022 to 25.4% for the year ended December 31, 2023. This was mainly
due to the increase in the average selling prices of our overseas gold product from
approximately RMB380.2 per gram in 2022 to RMB429.7 per gram in 2023 and the increase
in overseas raw materials expenses.
Other income and gains
Our other income and gains decreased by 3.0% from RMB142.1 million for the year
ended December 31, 2022 to RMB137.8 million for the year ended December 31, 2023. This
was primarily due to a decrease in gains on changes in fair value of financial assets at fair value
through profit or loss of RMB17.9 million, partially offset by the increase in government
subsidies of RMB12.9 million.
Selling and distribution expenses
Our selling expenses for the years ended December 31, 2022 and 2023 remained stable
at RMB0.7 million.
Administrative expenses
Our administrative expenses increased by 8.1% from RMB786.4 million for the year
ended December 31, 2022 to RMB850.4 million for the year ended December 31, 2023. This
was primarily due to an increase in resources tax levied on our mining business of RMB105.0
million in line with the increase in sales volume of our gold and other Mineral Resources
products, partially offset by the decrease in professional service expenses of RMB 47.1 million.
Research and development expenses
Our research and development expenses increased by 87.2% from RMB27.7 million for
the year ended December 31, 2022 to RMB51.8 million for the year ended December 31, 2023.
This was primarily due to: (i) an increase in the number of research and development
personnel; and (ii) increased investments in technology improvement projects to enhance
efficiency and strengthen security measures at Wulong Gold Mine and Jilong Gold Mine in
2023.
FINANCIAL INFORMATION
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--- page 521 ---
Impairment losses on financial assets, net
Our net impairment losses on financial assets increased by 278.9% from RMB0.6 million
for the year ended December 31, 2022 to RMB2.4 million for the year ended December 31,
2023. This was primarily due to the provision of credit losses of other receivables.
Other expenses and losses
Our other expenses and losses increased by 45.8% from RMB119.0 million for the year
ended December 31, 2022 to RMB173.5 million for the year ended December 31, 2023. This
was primarily due to an increase in loss on derecognition of financial liabilities at fair value
through profit or loss of RMB58.8 million attributable to our gold leasing transactions.
Finance costs
Our finance costs increased by 21.8% from RMB176.5 million for the year ended
December 31, 2022 to RMB215.0 million for the year ended December 31, 2023. This was
primarily due to: (i) an increase in interest on loans of RMB31.8 million as GSWL has taken
on new long-term borrowing of USD90.0 million from May 2022; (ii) an increase of interest
on gold lease arrangements and interest on lease liabilities of RMB4.4 million attributable to
the gold leasing contracts with the bank; and (iii) an increase of interest on lease liabilities of
RMB2.1 million. This was partially offset by (i) the decrease of the interest on mineral assets
of RMB0.03 million; and (ii) the decrease of the interest on metal streaming arrangements of
RMB0.3 million.
Share of (losses)/profits of associates
We recorded share of losses of associates of RMB4.1 million for the year ended December
31, 2022, while we recorded share of profits of associates of RMB10.0 million for the year
ended December 31, 2023. This was primarily due to the previous investment of Tietto
Minerals Limited which made a profit for the year ended December 31, 2023. As of the Latest
Practicable Date, we sold all equity interests in Tietto Minerals Limited to an independent third
party.
Profit before tax
Our profit before tax increased by 46.8% from RMB822.0 million for the year ended
December 31, 2022 to RMB1,206.8 million for the year ended December 31, 2023. This was
primarily due to: (i) the increase in gold selling price from approximately RMB382.9 per gram
in 2022 to RMB435.7 per gram in 2023; (ii) the effective cost reduction and control measures;
(iii) the stable ore grade of the mines; and (iv) the increase of gross profit margin of the gold
mining business.
FINANCIAL INFORMATION
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--- page 522 ---
Income tax expenses
Our income tax expenses increased by 2.2% from RMB328.1 million for the year ended
December 31, 2022 to RMB335.2 million for the year ended December 31, 2023. This was
primarily due to an increase in current income tax expenses of RMB201.6 million as a result
of the increase in the profit before tax. This was partially offset by a decrease in our deferred
tax expenses of RMB194.5 million as a result of a decrease in deferred tax assets under Golden
Star Resources.
Y ear Ended December 31, 2022 Compared to Y ear Ended December 31, 2021
Revenue
Our revenue increased by 65.7% from RMB3,782.6 million for the year ended December
31, 2021 to RMB6,266.8 million for the year ended December 31, 2022. The increase was
mainly due to increases in the revenue of our gold mining business as a result of our acquisition
of Golden Star Resources in January 2022.
By business nature
The revenue of our gold mining business increased by 78.7% from RMB2,968.7 million
for the year ended December 31, 2021 to RMB5,304.7 million for the year ended December 31,
2022. This was mainly due to: (i) the increase in production and sales volume of our gold
mines; and (ii) the increase in the average selling prices of our gold products. Our acquisition
of Golden Star Resources contributed a gold production of 162 koz in 2022. The gold
production volume of Sepon Gold and Copper Mine increased from 193.0 koz in 2021 to 199.5
koz in 2022. This was primarily due to the increase of gold recovery rate as a result of a series
of capital investments and operational improvements. Our gold production volume in China
increased from 67.2 koz in 2021 to 74.6 koz of gold in 2022. This was primarily due to the
completion of our technological upgrade and improvement in our mining and processing
capacity and ore grade of Wulong Gold Mine. In line with the increased production volume,
our total sales volume of gold increased from 251 koz in 2021 to 445 koz in 2022. We also
experienced an increase in average selling prices for our gold product from approximately
RMB380.8 per gram in 2021 to RMB382.9 per gram in 2022. This increase was generally in
line with the increase in gold price globally during the same period.
The revenue of our other Mineral Resources business increased by 17.9% from
RMB551.3 million for the year ended December 31, 2021 to RMB650.2 million for the year
ended December 31, 2022. This was mainly due to the increased production volume of copper
cathodes of the Sepon Gold and Copper Mine. In 2021 and 2022, our copper business in Laos
produced 5,019.7 tonnes and 6,433.2 tonnes of copper cathodes, respectively, and the sales
volume increased from 5,492.4 tonnes in 2021 to 6,592.6 tonnes of copper cathodes in 2022.
FINANCIAL INFORMATION
–5 1 1–


--- page 523 ---
The revenue of other business increased by 18.7% from RMB262.7 million for the year
ended December 31, 2021 to RMB311.9 million for the year ended December 31, 2022. This
was mainly due to the increased amount of waste electronic products and electrical appliances
we sold through Guangyuan Technology.
By origin of our products
Revenue generated from our PRC operations increased by 17.3% from RMB1,259.7
million for the year ended December 31, 2021 to RMB1,477.5 million for the year ended
December 31, 2022. This was primarily due to (i) an increase in sales volume of gold (mainly
due to increase in gold sales volume of Wulong Mining from 28 koz in 2021 to 44 koz of gold
in 2022 and partially offset by the decrease of gold sales volumes of Huatai Mining and Jilong
Mining); (ii) an increase in average selling prices of gold, which was in line with the overall
increase in gold price during this period in China. The average selling prices for our gold
product in the PRC increased from approximately RMB376.0 per gram in 2021 to RMB396.4
per gram in 2022; and (iii) an increase in revenue from our domestic non-ferrous metal mining
business, mainly attributable to increased sales volume of zinc concentrate powder from
19,932.9 tonnes in 2021 to 21,881.3 tonnes in 2022 and an increase in the average selling prices
of zinc from RMB6,821 per tonne to RMB7,966 per tonne during the same period.
Revenue generated from our overseas operations increased by 89.8% from RMB2,522.9
million for the year ended December 31, 2021 to RMB4,789.3 million for the year ended
December 31, 2022. First, this was primarily due to revenue generated from the gold mining
business at GSWL, which we acquired in 2022. In 2022, the revenue generated from Golden
Star Resources was RMB1,790.6 million, representing 28.6% of our total revenue for the same
year. The sales volume of gold at the Wassa Gold Mine was 157 koz in 2022. For details of the
acquisition, see “Business — Our Gold Production Business in Ghana”. Second, this was also
attributable to the increase of gold production in Sepon Gold and Copper Mine in Laos. The
gold production volume of the Sepon Gold and Copper Mine increased from 183 koz in 2021
to 214 koz in 2022. This was primarily due to the increase of gold recovery rate as a result of
a series of capital investments and operational improvements.
Cost of sales
Our cost of sales increased by 77.1% from RMB2,525.1 million for the year ended
December 31, 2021 to RMB4,471.9 million for the year ended December 31, 2022. This was
mainly due to increases in the cost of sales of our gold mining business, as a result of: (i) our
increase in sales volume of gold; (ii) our consolidation of the accounts of Golden Star
Resources from February 1, 2022; and (iii) increase in materials expenses, which was mainly
attributable to the rising raw material prices.
FINANCIAL INFORMATION
– 512 –


--- page 524 ---
By business nature
The cost of sales of our gold mining business increased by 82.8% from RMB2,100.0
million for the year ended December 31, 2021 to RMB3,838.9 million for the year ended
December 31, 2022. This was mainly due to: (i) increased gold production volume from 260.2
koz in 2021 to 436.2 koz in 2022, mainly attributable to our acquisition of Golden Star
Resources in 2022. In line with the increase in production volume, our sales volume of gold
increased from 251 koz in 2021 to 445 koz in 2022; and (ii) the rising raw material prices.
The cost of sales of our other Mineral Resources business increased by 72.1% from
RMB215.5 million for the year ended December 31, 2021 to RMB370.8 million for the year
ended December 31, 2022. This was mainly due to: (i) an increase in raw material prices and
electricity fees; and (ii) the increased amount of copper cathodes and other non-ferrous metals
we processed and produced in 2022 through Sepon Gold and Copper Mine and Hanfeng
Polymetallic Mine.
The cost of sales of other business increased by 25.4% from RMB209.7 million for the
year ended December 31, 2021 to RMB262.1 million for the year ended December 31, 2022.
This was mainly due to the increased amount of waste home appliances we dismantled through
Guangyuan Technology.
By origin of our products
The cost of sales of our PRC operations increased from RMB668.0 million for the year
ended December 31, 2021 to RMB808.8 million for the year ended December 31, 2022. This
was primarily due to (i) increased material expenses in line with increase in sales volume of
gold. The gold sales volume of Wulong Mining was up from 28 koz in 2021 to 44 koz in 2022;
(ii) an increase in the cost of raw materials in line with increased sales volume of zinc
concentrate powder and lead concentrate powder of Hanfeng Mining; and (iii) low ore grade
of Jilong Gold Mine, which led to increased cost.
The cost of sales of our overseas operations increased from RMB1,857.2 million for the
year ended December 31, 2021 to RMB3,663.1 million for the year ended December 31, 2022.
This was primarily due to (i) the cost of sales of Golden Star Resources, which we acquired
in 2022; (ii) increased materials expenses in line with the increased sales volume of gold and
copper cathodes; and (iii) increased raw material prices globally.
Gross profit and Gross profit margin
Our gross profit increased by 42.7% from RMB1,257.5 million for the year ended
December 31, 2021 to RMB1,794.9 million for the year ended December 31, 2022. Our gross
profit margin decreased from 33.2% for the year ended December 31, 2021 to 28.6% for the
year ended December 31, 2022. This was mainly due to the increase of the raw material price
and the acquisition of Golden Star Resources in 2022.
FINANCIAL INFORMATION
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--- page 525 ---
By business nature
The gross profit of our gold mining business increased by 69.2% from RMB868.7 million
for the year ended December 31, 2021 to RMB1,465.8 million for the year ended December 31,
2022. The gross profit margin of our gold mining business decreased from 29.3% for the year
ended December 31, 2021 to 27.6% for the year ended December 31, 2022. This was mainly
due to the increase of the cost of sales attributable to the increase of the raw materials and the
acquisition of Golden Star Resources in 2022.
The gross profit of our other Mineral Resources decreased by 15.8% from RMB335.8
million for the year ended December 31, 2021 to RMB279.4 million for the year ended
December 31, 2022. The gross profit margin of our non-ferrous metal mining business
decreased from 60.9% for the year ended December 31, 2021 to 43.0% for the year ended
December 31, 2022. This was mainly due to the decrease in the average grade of the copper
cathodes in LXML.
The gross profit of other business decreased by 7.7% from RMB53.0 million for the year
ended December 31, 2021 to RMB49.7 million for the year ended December 31, 2022. The
gross profit margin of our resource recycling business decreased from 33.2% for the year ended
December 31, 2021 to 28.6% for the year ended December 31, 2022. This was mainly due to
the decrease of dismantling volume of resources recycling business in 2022 and the change of
the government subsidy standards due to the change in subsidy policies in 2022.
By origin of our products
The gross profit margin of our PRC operations decreased slightly from 47.0% for the year
ended December 31, 2021 to 45.3% for the year ended December 31, 2022. This was mainly
due to the increase in material prices and the decline in the grade of ore mined by Jilong
Mining in 2022.
The gross profit margin of our overseas operations decreased slightly from 26.4% for the
year ended December 31, 2021 to 23.5% for the year ended December 31, 2022. This was
mainly due to (i) the increase in costs of sales attributable to the increase in the prices of raw
materials of LXML, including the price of diesel oil driven by the rising international crude oil
prices; and (ii) an increase in the amount of sulfuric acid used in 2022 by 60,000 tons compared
to 2021.
Other income and gains
Our other income and gains increased by 57.0% from RMB90.5 million for the year ended
December 31, 2021 to RMB142.1 million for the year ended December 31, 2022. This was
primarily due to: (i) an increase in gains on disposal of derivative financial instruments of
RMB57.8 million; and (ii) an increase in gains on changes in fair value of financial assets at
fair value through profit or loss of RMB16.5 million.
FINANCIAL INFORMATION
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--- page 526 ---
Our gains on disposal of derivative financial instruments increased by 231.5% from
RMB25.0 million for the year ended December 31, 2021 to RMB82.9 million for the year
ended December 31, 2022. This was primarily due to an investment income of RMB41.1
million derived from the disposal of gold lease hedging instruments and an investment income
of RMB54.8 million arising from the disposal of gold forward sales contracts.
Our finance income increased by 37.5% from RMB20.4 million for the year ended
December 31, 2021 to RMB28.1 million for the year ended December 31, 2022. This was
primarily due to the increase in the interests income of RMB9.5 million arising from the
acquisition of Golden Star Resources in 2022.
Selling and distribution expenses
Our selling expenses for the years ended December 31, 2021 and 2022 remained
relatively stable at RMB0.8 million and RMB0.7 million, respectively.
Administrative expenses
Our administrative expenses increased by 100.1% from RMB393.0 million for the year
ended December 31, 2021 to RMB786.4 million for the year ended December 31, 2022. This
was primarily due to: (i) an increase in labor expenses due to our acquisition of Golden Star
Resources in 2022; (ii) an increase in professional service expenses relating to our acquisition
of Golden Star Resources in 2022; and (iii) an increase in taxes and levies on operation of
RMB126.2 million due to an increase in resources tax levied on our mining business of
RMB126.2 million associated with the increase in sales volume of our gold and other Mineral
Resources products and acquisition of Golden Star Resources.
Research and development expenses
Our research and development expenses increased by 11.3% from RMB24.8 million for
the year ended December 31, 2021 to RMB27.7 million for the year ended December 31, 2022.
This was primarily due to increased investments in technology improvement projects to
enhance efficiency in mining and beneficiation, mainly in relation to Wulong Mining in 2022.
Impairment losses on financial assets, net
Our net impairment losses on financial assets decreased by 67.5% from RMB2.0 million
for the year ended December 31, 2021 to RMB0.6 million for the year ended December 31,
2022. This was primarily due to the reversal of credit losses that had been provided for in 2022.
Other expenses and losses
Our other expenses and losses decreased by 16.6% from RMB142.8 million for the year
ended December 31, 2021 to RMB119.0 million for the year ended December 31, 2022. This
was primarily due to (i) the decrease in the reversal of impairment losses on inventories of
RMB149.9 million; and (ii) the decrease in the foreign exchange of RMB59.0 million. The
decrease was partially offset by the increase in loss on changes in fair value of financial
liabilities at fair value through profit or loss of RMB27.3 million.
FINANCIAL INFORMATION
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--- page 527 ---
Finance costs
Our finance costs increased significantly by 1,140.6% from RMB14.2 million for the year
ended December 31, 2021 to RMB176.5 million for the year ended December 31, 2022. This
was primarily due to: (i) an increase in interest on loans of RMB123.9 million in 2022; (ii) an
increase in amortization of unrecognized financing expenses of mining right of RMB3.8
million and the interest on metal streaming arrangement of RMB15.4 million; (iii) an increase
in interest on lease liabilities of RMB10.0 million; and (iv) an increase of interest on gold lease
business of RMB8.6 million arising from our gold lease transaction.
Share of (losses)/profits of associates
We recorded share of losses of associates of RMB0.01 million for the year ended
December 31, 2021, while we recorded share of losses of associates of RMB4.1 million for the
year ended December 31, 2022. This was primarily due to the then investment in Tietto
Minerals Limited by our subsidiary Chijin HK, which resulted in a loss in 2022. As of Latest
Practicable Date, we sold all equity interests in Tietto Minerals Limited to an independent third
party.
Profit before tax
Our profit before tax increased by 6.7% from RMB770.4 million for the year ended
December 31, 2021 to RMB822.0 million for the year ended December 31, 2022. This was
primarily due to (i) the increase in gold selling price from approximately RMB381 per gram
in 2021 to RMB383 per gram in 2022; (ii) the effective cost reduction and control measures;
(iii) the stable ore grade of the mines; and (iv) the increase of gross profit margin of the gold
mining business.
Income tax expenses
Our income tax expenses increased by 109.0% from RMB157.0 million for the year ended
December 31, 2021 to RMB328.1 million for the year ended December 31, 2022. This was
primarily due to an increase of our current income tax expenses of RMB161.0 million arising
from: (i) high statutory income tax rates in Ghana (35.0%) and Laos (33.3%) in 2022, which
had significant impacts on our profits from Ghana and Laos in 2022.
LIQUIDITY AND CAPITAL RESOURCES
Our principal source of liquidity has been, and is expected to continue to be, cash
generated from operating activities together with available credit facilities and bank
borrowings. Our liquidity requirements primarily relate to funding our working capital
requirements and our capital expenditures. We had cash and cash equivalents of RMB1,707.9
million, RMB1,052.5 million, RMB1,274.6 million and RMB2,094.1 million as of December
31, 2021, 2022, and 2023 and September 30, 2024, respectively. As of December 31, 2024, the
latest practicable date for determining our indebtedness, we had cash and cash equivalents of
RMB2,516.9 million.
FINANCIAL INFORMATION
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Sufficiency of Working Capital
Taking into account the financial resources available to us, including our cash and cash
equivalents, available borrowings, and the estimated net proceeds from the Global Offering,
our Directors are of the opinion, and the Sole Sponsor concurs, that we have sufficient working
capital required for 125% of our present requirements, that is for at least the next 12 months
from the date of this Prospectus. Going forward, we believe our liquidity requirements will be
satisfied by using funds from a combination of our cash and cash equivalents, bank and other
borrowings and net proceeds from the Global Offering. Other than the bank and other
borrowings that we may obtain, we do not have any plans for material external debt financing.
The majority of our projects under development are extension projects of our current mines.
We believe that we are able to finance such projects using net operating cash flow from our
existing operations. For the nine months ended September 30, 2024, the net cash flows from
operating activities were RMB2,044.0 million and the capital expenditures were RMB1,125.4
million.
Net Current Assets
As of December 31, 2021, 2022 and 2023, September 30, 2024, and December 31, 2024,
we recorded net current assets of RMB2,416.6 million, RMB829.6 million, RMB1,173.0
million, RMB1,727.4 million and RMB2,335.0 million, respectively.
The table below sets forth our current assets and current liabilities as of the dates
indicated.
As of December 31,
As of
September 30,
As of
December 31,
2021 2022 2023 2024 2024
(RMB’000)
(unaudited)
Current assets
Inventories /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,412,094 2,164,628 2,406,909 2,449,670 2,540,318
Trade receivables from
comprehensive
recycling of resources
business /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118311,447 339,237 397,481 443,286 347,205
Trade receivables from
other sales /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825,260 29,637 115,732 163,455 239,961
Prepayments, other
receivables and other
assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118166,944 242,143 282,596 814,170 514,005
Financial assets at fair
value through profit
or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811,237 48,131 16,909 13,204 9,999
Derivative financial
assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,436 584 13,470 43,438 5,252
Restricted cash /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118116,881 232,560 387,648 303,616 230,543
Cash and cash
equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,707,868 1,052,545 1,274,635 2,094,141 2,516,899
Total current assets /H1118/H1118/H1118/H11183,758,167 4,109,465 4,895,380 6,324,980 6,404,182
FINANCIAL INFORMATION
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--- page 529 ---
As of December 31,
As of
September 30,
As of
December 31,
2021 2022 2023 2024 2024
(RMB’000)
(unaudited)
Current liabilities
Trade and notes
payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118440,401 851,390 552,457 636,817 684,571
Contract liabilities /H1118/H1118/H1118/H1118/H11184,547 62,052 73,177 89,172 56,599
Financial liabilities at
fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118387,683 620,250 939,996 1,026,210 707,020
Derivative financial
liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,831 – – 17,002 –
Other payables and
accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118191,169 695,336 697,447 792,303 547,705
Income tax payables /H1118/H1118/H1118/H1118102,438 177,082 267,693 455,815 548,456
Short-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118– 488,409 850,009 822,730 1,108,199
Current portion of
long-term loans /H1118/H1118/H1118/H1118/H1118/H111825,530 333,770 218,315 641,778 282,333
Current portion of
lease liabilities /H1118/H1118/H1118/H1118/H1118/H11181,424 31,177 38,083 38,204 37,840
Current portion of other
non-current liabilities /H1118/H1118186,589 10,849 9,485 5,717 5,786
Current portion of
provisions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 9,567 75,747 71,806 72,505
Total current liabilities /H11181,341,612 3,279,882 3,722,409 4,597,554 4,051,014
Net current assets /H1118/H1118/H1118/H1118/H11182,416,555 829,583 1,172,971 1,727,426 2,353,168
Our net current assets increased from RMB1,727.4 million as of September 30, 2024 to
RMB2,353.2 million as of December 31, 2024. This was primarily due to (i) an increase in cash
and cash equivalents by RMB422.8 million, attributable to higher gold prices and our operating
cash inflow; and (ii) a decrease in the current portion of long-term loans by RMB359.4 million,
as a result of loan repayments from GSWL and our Company.
Our net current assets increased from RMB1,173.0 million as of December 31, 2023 to
RMB1,727.4 million as of September 30, 2024. This was primarily due to (i) the increase in
the prepayments, receivables and other assets of RMB531.6 million attributable to
prepayments made for rear earth purchases, and (ii) the increase in the increase in trade
receivables from other business attributable to prepayments from government subsidy.
Our net current assets increased from RMB829.6 million as of December 31, 2022 to
RMB1,173.0 million as of December 31, 2023. This was primarily due to: (i) an increase in
inventories of RMB242.3 million, mainly due to an increase in work in progress at Sepon Gold
and Copper Mine; (ii) an increase in in cash and cash equivalents of RMB222.1 million
resulting from an increase in free cash flow from operations; (iii) a decrease in trade and notes
FINANCIAL INFORMATION
– 518 –


--- page 530 ---
payables of RMB298.9 million. The increase was partially offset by: (i) an increase in financial
liabilities at fair value through profit or loss of RMB319.7 million resulting from the increase
of gold leasing; and (ii) an increase in short-term loans of RMB361.6 million.
Our net current assets decreased significantly from RMB2,416.6 million as of December
31, 2021 to RMB829.6 million as of December 31, 2022. This was primarily due to: (i) a
decrease in cash and cash equivalents of RMB655.3 million resulting from the acquisition of
Golden Star Resources in 2022; (ii) an increase in other payables and accruals of RMB504.2
million mainly for construction projects and equipment; and (iii) an increase in short-term
loans of RMB488.4 million associated with the acquisition of Golden Star Resources and a
capacity expansion of Jilong Gold Mine. The decrease was partially offset by an increase in
inventories resulting from our acquisition of Golden Star Resources and raw materials for
Sepon Gold and Copper Mine’s expanded production.
Cash Flows Analysis
The table below sets forth selected cash flow statement information from our consolidated
cash flow statements for the periods indicated:
Y ear Ended December 31,
Nine Months Ended
September 30,
2021 2022 2023 2023 2024
(RMB’000)
(unaudited)
Net cash flows from
operating activities /H1118/H1118/H1118/H1118/H1118755,149 1,090,133 2,203,080 1,205,363 2,043,988
Net cash flows used in
investing activities /H1118/H1118/H1118/H1118/H1118(277,873) (3,984,047) (1,771,119) (1,443,021) (677,127)
Net cash flows from/(used
in) financing activities /H1118/H111855,905 2,225,143 (228,120) 257,705 (554,463)
Net increase/(decrease)
in cash and cash
equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118533,181 (668,771) 203,841 20,047 812,389
Cash and cash equivalents
at beginning of
year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,176,419 1,707,868 1,052,545 1,052,545 1,274,635
Effect of foreign exchange
rate changes, net /H1118/H1118/H1118/H1118/H1118/H1118(1,732) 13,448 18,249 12,708 7,108
Cash and cash
equivalents at the end
of the year/period /H1118/H1118/H1118/H1118/H11181,707,868 1,052,545 1,274,635 1,085,300 2,094,141
FINANCIAL INFORMATION
– 519 –


--- page 531 ---
Net cash flows from operating activities
For the nine months ended September 30, 2024, we recorded net cash inflow from
operating activities of RMB2,044.0 million. This was primarily due to our profit before tax of
RMB1,848.0 million, adjusted by non-cash and non-operating items, mainly comprising: (i)
depreciation of property, plant and equipment of RMB687.5 million; (ii) amortization of other
intangible assets of RMB226.0 million; and (iii) investment losses received from disposal of
financial liabilities held for trading of RMB107.4 million. This was partially offset by: (i) an
increase in inventories of RMB73.7 million; and (ii) a decrease in other payables and accruals
of RMB148.0 million.
In 2023, we recorded inflow from operating activities of RMB2,203.1 million. This was
primarily due to our profit before tax of RMB1,206.8 million, adjusted by non-cash and
non-operating items, mainly comprising: (i) depreciation of property, plant and equipment of
RMB910.8 million; (ii) amortization of other intangible assets of RMB552.4 million; and (iii)
increase in other payables and accruals of RMB160.9 million. This was partially offset by: (i)
decrease in trade and notes payables of RMB262.1 million; and (ii) an increase in inventories
of RMB143.8 million.
In 2022, we recorded inflow from operating activities of RMB1,090.1 million. This was
primarily due to our profit before tax of RMB822.0 million, adjusted by non-cash and
non-operating items, which primarily included (i) depreciation of property, plant and
equipment of RMB761.2 million; (ii) amortization of other intangible assets of RMB582.2
million; and (iii) decrease in trade and notes payables of RMB218.0 million. This was partially
offset by: (i) an increase in inventories of RMB329.0 million; and (ii) a decrease in other
payables and accruals of RMB300.2 million.
In 2021, we recorded net cash inflow from operating activities of RMB755.1 million. This
was primarily due to our profit before tax of RMB770.4 million, adjusted by non-cash and
non-operating items, mainly comprising: (i) depreciation of property, plant and equipment of
RMB455.7 million; (ii) amortization of other intangible assets of RMB315.9 million; and (iii)
increase in trade and notes payables of RMB143.4 million. This was partially offset by: (i) an
increase in inventories of RMB815.7 million; and (ii) an increase in prepayments, other
receivables and other assets of RMB66.0 million.
Net cash flows from investing activities
For the nine months ended September 30, 2024, we recorded net cash outflow used in
investing activities of RMB677.1 million. This was primarily due to: (i) purchases of property,
plant and equipment, intangible assets and other non-current assets of RMB1,113.4 million;
and (ii) cash paid for futures contract of RMB254.8 million, which was partially offset by cash
received from futures contract of RMB300.9 million.
FINANCIAL INFORMATION
– 520 –


--- page 532 ---
In 2023, we recorded net cash outflow used in investing activities of RMB1,771.1
million. This was primarily due to: (i) purchases of property, plant and equipment, intangible
assets and other non-current assets of RMB1,742.0 million; (ii) net cash paid for acquisition
of a subsidiary of RMB18.1 million; and (iii) cash paid for futures contract of RMB279.8
million. This was partially offset by: (i) cash received from futures contract of RMB235.4
million; and (ii) proceeds from disposal of property, plant and equipment, intangible assets, and
other non-current assets RMB19.9 million.
In 2022, we recorded net cash outflow used in investing activities of RMB3,984.0
million. This was mainly due to: (i) purchases of property, plant and equipment, intangible
assets and other non-current assets of RMB1,917.6 million; (ii) net cash paid for acquisition
of a subsidiary of RMB1,958.4 million; and (iii) cash paid for futures contract of RMB369.3
million. This was partially offset by: (i) cash received from futures contract of RMB592.8
million; and (ii) cash received from bank deposits and interest of RMB100.1 million.
In 2021, we recorded net cash outflow used in investing activities of RMB277.9 million.
This was primarily due to: (i) purchases of property, plant and equipment, intangible assets and
other non-current assets of RMB1,342.4 million; (ii) cash paid for large certificates of
RMB1,740.1 million; and (iii) cash paid for equity investments of RMB14.6 million. This was
partially offset by: (i) cash received from bank deposits and interest of RMB2,477.6 million;
and (ii) net cash received from the disposal of a subsidiary of RMB288.8 million.
Net cash flows from financing activities
For the nine months ended September 30, 2024, we recorded net cash outflow used in
financing activities of RMB554.5 million. This was mainly due to: (i) repayment of bank
borrowings of RMB1,381.9 million; (ii) repayment of gold lease business of RMB706.4
million; (iii) repayment of loans from related parties RMB128.5 million; and (iv) cash paid for
margin of gold lease business of RMB281.4 million. This was partially offset by: (i) new bank
borrowings of RMB1,044.3 million; and (ii) new gold lease business of RMB599.3 million.
In 2023, we recorded net cash outflow used in financing activities of RMB228.1 million.
This was mainly due to: (i) repayment bank borrowings of RMB1,013.7 million; (ii) repayment
of gold lease business of RMB560.7 million; and (iii) cash paid for margin of gold lease
business of RMB384.3 million. This was partially offset by (i) new bank borrowings of
RMB1,151.1 million, and (ii) new gold lease business of RMB740.0 million.
In 2022, we recorded net cash inflow from financing activities of RMB2,225.1 million.
This was primarily due to (i) new bank borrowings of RMB2,443.3 million, (ii) new loans from
related parties of RMB1,537.2 million, and (iii) new gold lease business of RMB496.9 million.
This was partially offset by: (i) repayment of gold lease business of RMB312.0 million; and
(ii) repayment of loans from related parties of RMB1,126.3 million.
FINANCIAL INFORMATION
– 521 –


--- page 533 ---
In 2021, we recorded net cash inflow from financing activities of RMB55.9 million. This
was primarily due to: (i) cash received from transfer of repurchased shares of RMB663.2
million; (ii) new loans from related parties of RMB620.0 million; and (iii) new gold lease
business of RMB384.6 million. This was partially offset by: (i) cash paid for repurchasing
shares of RMB663.2 million; and (ii) repayment of loans from related parties of RMB620.0
million.
CAPITAL EXPENDITURES
A key component of cash flows used in investing activities is capital expenditures. We
calculate capital expenditures as purchases of fixed assets, construction in progress (“ CIP”),
purchase of intangible assets and others.
Our increasing capital expenditures during the Track Record Period reflected our
expansion investments to fuel and support our expected future growth. The following table sets
forth our capital expenditures for the periods indicated:
Y ear Ended December 31,
Nine Months Ended
September 30,
2021 2022 2023 2023 2024
(RMB’000)
(unaudited)
Purchase of fixed assets /H1118/H1118/H111889,978 194,363 33,870 26,801 24,621
Purchase of CIP /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118779,987 1,118,629 1,354,306 1,067,910 1,085,705
Purchase of intangible
assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118689,830 533,491 34,279 6,816 3,804
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111872 56,613 64,917 650 11,283
Capital expenditures /H1118/H1118/H1118/H11181,559,867 1,903,096 1,487,372 1,102,177 1,125,413
Capital expenditures as
% of revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111841.2% 30.4% 20.6% 21.8% 18.1%
We may incur additional capital expenditures from time to time as we pursue new
opportunities to expand our business.
FINANCIAL INFORMATION
– 522 –


--- page 534 ---
CAPITAL COMMITMENTS
Our capital commitments during the Track Record Period primarily related to property,
plant and equipment and investment commitment. As of December 31, 2021, 2022 and 2023
and September 30, 2024, the total amount of our outstanding capital commitments was
RMB351 million, RMB552 million RMB487 million, and RMB557 million, respectively. The
following table sets forth a summary of our capital commitments as of the dates indicated:
Y ear Ended December 31,
Nine Month
Ended
September 30,
2021 2022 2023 2024
(RMB’000)
(unaudited)
Contracted, but not
provided for:
Property, plant and
equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111898,016 233,730 230,173 234,385
Investment commitment /H1118/H1118/H1118/H1118253,000 318,064 256,864 322,901
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118351,016 551,794 487,037 557,286
FINANCIAL INFORMATION
– 523 –


--- page 535 ---
FORECASTED OPERATING COSTS
According to the Independent Technical Report, our total operating cash cost is estimated at RMB3,141 million, with an estimated unit cash
operating cost of RMB510 per milled ore tonnes in 2024. Our total operating cash cost is estimated at RMB15,949 million, with an estimated unit
cash operating cost of RMB535 per milled ore tonnes. SRK has developed a unit sustaining capital forecast based on the average expenditures for
2022 and 2023.
The table below sets forth a summary of the forecasted operating costs between 2024 and 2053 as stated in the Independent Technical Report:
Total Unit LOM
2024
Q4 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049 2050 2051 2052 2053
Physicals
Total Ore Mined /H1118/H1118/H1118/H1118kt 26,170 3,009 7,608 5,341 3,303 1,811 1,217 827 731 678 267 199 94 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 61 50
Gold Produced /H1118/H1118/H1118/H1118/H1118koz 1,686 1 1 0 3 3 6 3 2 7 2 5 1 1 3 8 9 2 6 1 5 1 3 5 2 9 2 1 1 5 1 09 1 1 1 3 1 2 1 1 1 3 1 1 1 6 1 9 1 7 1 7 1 4 1 4 1 3886
Copper Produced /H1118/H1118/H1118/H1118kt 5 23––––––––––––––––––––––––––––
Zinc Produced /H1118/H1118/H1118/H1118/H1118kt 152 – 1 9 1 8 1 9 1 4 2 4 2 5 1 8 1 5–––––––––––––––––––––
Operating Cash Cost
Labor /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Million RMB 4,349 342 921 745 543 304 200 173 154 136 81 66 57 35 35 35 35 35 35 35 35 35 35 35 35 35 35 35 35 35 29
Material /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Million RMB 6,273 916 2,143 1,472 813 407 214 77 59 52 27 19 1 4333333333333333333
Electricity /H1118/H1118/H1118/H1118/H1118/H1118/H1118Million RMB 1,293 1 4 9 3 7 4 2 7 4 1 6 8 8 6 5 1 3 2 2 7 2 4 1 198555555555555555554
Contractors /H1118/H1118/H1118/H1118/H1118/H1118Million RMB 275 2 5 8 6 6 9 4 6 1 87766221––––––––––––––––––
Engineering /H1118/H1118/H1118/H1118/H1118/H1118Million RMB 640 30 103 94 70 36 23 22 21 20 13 12 11 10 10 10 10 10 10 10 10 10 10 10 10 10 10 10 10 10 9
Service /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Million RMB 204 1 2 3 8 3 4 2 6 1 5 1 0 1 099753111111111111111111
Safety /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Million RMB 94 4 1 0 1 1 1 186654221111111111111111111
Repairment /H1118/H1118/H1118/H1118/H1118/H1118Million RMB 31 133432222111000000000000000000
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Million RMB 108 1 1 3 8 3 0 2 061111000000000000000000000
Taxes and surcharges /H1118/H1118Million RMB 1,262 1 5 0 3 6 6 2 6 4 1 7 0 8 6 4 6 3 0 2 4 1 9 1 087555555555555555554
Selling costs /H1118/H1118/H1118/H1118/H1118/H1118Million RMB 3 01100000000–––––––––––––––––––
G&A costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118Million RMB 1,902 162 419 331 233 125 75 60 53 45 30 26 21 18 18 18 18 18 18 18 18 18 18 18 18 18 18 18 18 18 15
R&D costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118Million RMB 173 1 3 3 0 2 9 3 1 2 0 1 3 1 3 1 07322––––––––––––––––––
Note: LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year since September 30, 2024, until all Ore Reserves are ex tracted in the final
year. The forecasted production volume is estimated based on the designed mining capacity, scheduling strategy and expansion timelines. For detail s, please refer to the mine
schedule set forth in “Business — Development Plan and Planned Production Schedule — Planned Production Schedule”.
FINANCIAL INFORMATION
– 524 –


--- page 536 ---
DISCUSSION OF SELECTED ITEMS FROM THE CONSOLIDATED STATEMENTS
OF FINANCIAL POSITION OF OUR GROUP
The following table sets forth our consolidated statements of financial position as of the
dates indicated:
As of December 31,
As of
September 30,
2021 2022 2023 2024
(RMB’000)
Non-current assets
Property, plant and
equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,159,699 5,994,266 6,521,646 6,894,292
Right-of-use assets /H1118/H1118/H1118/H1118/H1118/H1118/H111843,887 278,571 332,756 313,197
Other intangible assets /H1118/H1118/H1118/H1118/H1118856,450 6,562,718 6,323,009 6,042,442
Goodwill /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111841,969 41,969 41,969 41,969
Investments in associates /H1118/H1118/H11181,989 357,819 373,481 2,050
Deferred tax assets /H1118/H1118/H1118/H1118/H1118/H1118/H11185,215 53,978 17,482 55,555
Other non-current assets /H1118/H1118/H1118186,230 145,508 212,070 220,683
Total non-current assets /H1118/H1118/H11184,295,439 13,434,829 13,822,413 13,570,188
Current assets
Inventories /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,412,094 2,164,628 2,406,909 2,449,670
Trade receivables from
comprehensive recycling
of resources business /H1118/H1118/H1118/H1118311,447 339,237 397,481 443,286
Trade receivables from
other sales /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825,260 29,637 115,732 163,455
Prepayments, other
receivables and other
assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118166,944 242,143 282,596 814,170
Financial assets at fair value
through profit or loss /H1118/H1118/H1118/H111811,237 48,131 16,909 13,204
Derivative financial assets /H1118/H1118 6,436 584 13,470 43,438
Restricted cash /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118116,881 232,560 387,648 303,616
Cash and cash equivalents /H1118/H11181,707,868 1,052,545 1,274,635 2,094,141
Total current assets /H1118/H1118/H1118/H1118/H1118/H11183,758,167 4,109,465 4,895,380 6,324,980
Total assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,053,606 17,544,294 18,717,793 19,895,168
Current liabilities
Trade and notes payables /H1118/H1118/H1118440,401 851,390 552,457 636,817
Contract liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,547 62,052 73,177 89,172
Financial liabilities at fair
value through profit or
loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118387,683 620,250 939,996 1,026,210
Derivative financial
liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,831 – – 17,002
Other payables and
accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118191,169 695,336 697,447 792,303
Income tax payables /H1118/H1118/H1118/H1118/H1118/H1118102,438 177,082 267,693 455,815
FINANCIAL INFORMATION
– 525 –


--- page 537 ---
As of December 31,
As of
September 30,
2021 2022 2023 2024
(RMB’000)
Short-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 488,409 850,009 822,730
Current portion of Long-
term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825,530 333,770 218,315 641,778
Current portion of lease
liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,424 31,177 38,083 38,204
Current portion of other
non-current liabilities /H1118/H1118/H1118/H1118186,589 10,849 9,485 5,717
Current portion of
provisions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 9,567 75,747 71,806
Total current liabilities /H1118/H1118/H1118/H11181,341,612 3,279,882 3,722,409 4,597,554
Net current assets /H1118/H1118/H1118/H1118/H1118/H1118/H11182,416,555 829,583 1,172,971 1,727,426
Long-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,513,781 1,421,974 681,614
Contract liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 606,298 576,999 538,996
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,975 230,805 207,219 185,340
Deferred tax liabilities /H1118/H1118/H1118/H1118/H11181,916 2,455,981 2,314,654 2,245,052
Provisions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,631,259 1,984,834 1,868,099 1,781,346
Other non-current liabilities /H1118 74,813 64,410 64,231 65,368
Total net-current liabilities /H1118 1,710,963 6,856,109 6,453,176 5,497,716
Net assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,001,031 7,408,303 8,542,208 9,799,898
Property, plant and equipment
Our property, plant and equipment comprised buildings, machinery, vehicles, electronic
equipment and others, mineral and construction in progress. The following table sets forth a
breakdown of the net book value of our property, plant and equipment as of the dates indicated:
As of December 31,
As of
September 30,
2021 2022 2023 2024
(RMB’000)
Buildings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118292,763 390,872 594,850 747,680
Machinery /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,017,790 1,473,615 1,411,342 1,298,021
Mobile equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111896,293 226,248 197,961 167,532
Electronic Equipment and
others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111816,929 23,986 27,684 25,746
Mineral assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,300,299 3,202,712 3,697,496 3,438,586
Construction in progress /H1118/H1118/H1118435,625 676,833 592,313 1,216,727
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,159,699 5,994,266 6,521,646 6,894,292
FINANCIAL INFORMATION
– 526 –


--- page 538 ---
Our property, plant and equipment increased by 89.7% from RMB3,159.7 million as of
December 31, 2021 to RMB5,994.3 million as of December 31, 2022. This was primarily due
to: (i) an increase in mineral assets of RMB1,902.4 million, resulting from the acquisition of
Golden Star Resources and our constructions in progress at Wulong Gold Mine and Wassa Gold
Mine; and (ii) an increase in machinery of RMB455.8 million, resulting from constructions in
progress at Wulong Gold Mine and Sepon Gold and Copper Mine.
Our property, plant and equipment increased by 8.8% from RMB5,994.3 million as of
December 31, 2022 to RMB6,521.6 million as of December 31, 2023. This was primarily due
to: (i) an increase in mineral assets of RMB494.8 million resulting from capital expenses in
relation to the construction and auxiliary facilities at the Sepon Gold and Copper Mine and
Wassa Gold Mine; and (ii) an increase in buildings of RMB204.0 million, mainly resulting
from the increased value of real estate and buildings at the Sepon Gold and Copper Mine.
Our property, plant and equipment slightly increased by 5.7% from RMB6,521.6 million
as of December 31, 2023 to RMB6,894.3 million as of September 30, 2024. This was primarily
due to an increase in construction in progress of RMB624.4 million, resulting from
construction of mining projects at the Wassa Gold Mine and the Sepon Gold and Copper Mine.
This was partially offset by the decrease in mineral assets of RMB258.9 million.
Right-of-use assets
Our right-of-use assets represent our entitlement to use buildings, machinery and vehicles
and leasehold land. The following table sets forth a breakdown of right-of-use assets as of the
dates indicated:
As of December 31,
As of
September 30,
2021 2022 2023 2024
(RMB’000)
Buildings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118298 10,789 4,571 3,246
Machinery and vehicles /H1118/H1118/H1118/H1118– 185,835 167,836 147,316
Leasehold land /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111843,589 81,947 160,349 162,635
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111843,887 278,571 332,756 313,197
Our right-of-use assets increased significantly by 534.7% from RMB43.9 million as of
December 31, 2021 to RMB278.6 million as of December 31, 2022. This was primarily due to
an increase in machinery and vehicles of RMB185.8 million arising from our acquisition of
Golden Star Resources in 2022.
Our right-of-use assets increased by 19.5% from RMB278.6 million as of December 31,
2022 to RMB332.8 million as of December 31, 2023. This was primarily due to an increase in
leasehold land of RMB78.4 million, which was mainly due to: (i) our acquisition of Xinhenghe
Mining; (ii) the addition of the land use right of Wulong Mining for a lease term of 50 years;
and (iii) the addition of the land use right of Jilong Mining for a lease term of 50 years.
FINANCIAL INFORMATION
– 527 –


--- page 539 ---
Our right-of-use assets decreased by 5.9% from RMB332.8 million as of December 31,
2023 to RMB313.2 million as of September 30, 2024. This was primarily due to a decrease in
machinery and vehicles of RMB20.5 million, resulting from a decrease in book value and the
depreciation of right-of-use assets.
Other intangible assets
Our other intangible assets comprised exploration and mining rights, patent and others.
The following table sets forth a breakdown of the net book value of our other intangible assets
as of the dates indicated:
As of December 31,
As of
September 30,
2021 2022 2023 2024
(RMB’000)
Exploration and mining
rights /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118752,396 6,475,487 6,208,148 5,926,714
Patent /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,973 3,422 2,749 2,317
Exploration and evaluation
assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111897,118 64,844 97,326 100,104
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,963 18,965 14,786 13,307
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118856,450 6,562,718 6,323,009 6,042,442
Our other intangible assets increased significantly by 666.3% from RMB856.5 million as
of December 31, 2021 to RMB6,562.7 million as of December 31, 2022. This was primarily
due to an increase in exploration and mining rights of RMB5,723.1 million resulting from our
acquisition of Golden Star Resources in 2022.
Our other intangible assets decreased by 3.7% from RMB6,562.7 million as of December
31, 2022 to RMB6,323.0 million as of December 31, 2023. This was primarily due to a
decrease in exploration and mining rights of RMB267.3 million mainly associated with the
Sepon Gold and Copper Mine and Wassa Gold Mine, resulting from our normal amortization.
Our other intangible assets decreased by 4.4% from RMB6,323.0 million as of December
31, 2023 to RMB6,042.4 million as of September 30, 2024. This was primarily due to a
decrease in exploration and mining rights of RMB281.4 million mainly associated with Sepon
Gold and Copper Mine and Wassa Gold Mine, resulting from our normal amortization. The
exploration expenditure was RMB38.3 million, RMB40.2 million, RMB32.5 million, and
RMB2.8 million for 2021, 2022, 2023 and the nine months ended September 30, 2024,
respectively. These amounts have all been capitalized and were recorded under exploration and
evaluation assets.
FINANCIAL INFORMATION
– 528 –


--- page 540 ---
Goodwill
As of December 31, 2021, 2022 and 2023 and September 30, 2024, our book value of
goodwill remained stable at RMB42.0 million, RMB42.0 million, RMB42.0 million and
RMB42.0 million, respectively, which was contributed by our acquisition of Guangyuan
Technology in 2015.
Goodwill acquired through business combinations is allocated to the recycling and
utilisation CGU for impairment testing. The recoverable amount of the recycling and utilisation
CGU has been determined based on a value in use calculation using cash flow projections
based on financial budgets covering a five-year period approved by senior management. As of
31 December 2021, 2022 and 2023 and 30 September 2024, the pre-tax discount rates applied
to the cash flow projections are 13.46%, 11.89%, 9.21% and 8.79%, respectively. The growth
rate used to extrapolate the cash flows of the recycling and utilisation CGU beyond the
five-year period is 0%.
Assumptions were used in the value in use calculation of the recycling and utilisation
cash-generating CGU. The following describes each key assumption on which management has
based its cash flow projections to undertake impairment testing of goodwill:
1. The expected future sales volume – The management forecasted disassembly
volume based on the disassembly volume capacity and the expected five years’
production schedule of the CGU.
2. The price of the dismantled product – The management forecasted the price of the
dismantled product based on the actual sales unit price of the previous year with its
expectations on market development.
3. The collection period of the fund subsidy income – The management forecasted
the collection period of the fund subsidy income based on the historical collection
period with its expectations on market development.
4. Discount rate – The discount rates used are before tax and reflect specific risks
relating to the relevant CGU.
Management determined these assumptions based on past performance and its
expectations on market development. The discount rates used reflect specific risks relating to
the individual CGU. The recoverable amount is determined based on the present value of the
estimated future cash flows of the asset group portfolio. According to the five-year financial
forecast approved by the management, the growth rates of the dismantling volume of waste
electronic products and electrical appliances from 2024 to 2028 during the forecast period are
projected to be 3%, 6%, 10%, 5%, and 3%, respectively, and the dismantling volume of waste
electronic products and electrical appliances will remain stable from 2029 onwards. Based on
the impairment assessments, there was no impairment of goodwill as of December 31, 2021,
2022 and 2023 and September 30, 2024. For the goodwill allocated to the CGU, future sales
FINANCIAL INFORMATION
– 529 –


--- page 541 ---
volume and price of the dismantled product are two of the most sensitive key assumptions: (i)
as of 31 December 2021, 2022 and 2023 and September 30, 2024, if future sales volume had
decreased by 1% from management’s estimates, while other variables were held constant with
the expectations, we would have to recognize impairment losses against goodwill by
approximately nil, nil, nil and nil, respectively; if future sales volume had decreased by 5%
from the management’s estimates, while other variables were held constant with the
expectations, we would have to recognize impairment losses against goodwill by
approximately nil, nil, nil and RMB42 million, respectively; and (ii) if the price of the
dismantled product had decreased by 1% from the estimates, while other variables were held
constant with the expectations, we would have to recognize impairment losses against goodwill
by approximately nil, nil, RMB25 million and RMB22 million, respectively; if the price of the
dismantled product had decreased by 5% from management’s estimates, while other variables
were held constant with the management’s expectations, we would have to recognize
impairment losses against goodwill by approximately nil, nil, RMB42 million and RMB42
million, respectively.
As of December 31, 2021, 2022 and 2023 and September 30, 2024, when the
aforementioned key assumption parameters were applied in the impairment testing, the
headroom (i.e., the excess of the recoverable amount over the carrying amount of the CGU)
was RMB82 million, RMB88 million, RMB17 million, and RMB19 million, respectively.
Investments in associates
Our investments in associates comprised share of the associates’ profit for the period,
investment costs and share of the associates’ total comprehensive income. The following table
sets forth a breakdown of our investments in associates as of the dates indicated:
Our investments in associates increased significantly by 17,889.9% from RMB2.0 million
as of December 31, 2021 to RMB357.8 million as of December 31, 2022, and increased by
4.4% to RMB373.5 million as of December 31, 2023, and further decreased by 99.5% to
RMB2.1 million as of September 30, 2024, as a result of our previous investments in Tietto
Minerals Limited. As of the Latest Practicable Date, we had disposed of all our equity interests
in Tietto Minerals Limited during the ordinary course of business. For more details, See
“History, Development and Corporate Structure — Post-Track Record Period Acquisition”.
FINANCIAL INFORMATION
– 530 –


--- page 542 ---
Deferred tax assets
Our deferred tax assets comprised impairment of assets, provision for bad debts on
receivables, provision for inventory impairment, provision for contingent liabilities, deferred
income, deductible losses, changes in fair value, lease liabilities, equity interest with taking
into consideration the offsetting of balance within the same tax jurisdiction. The following
table sets forth a breakdown of our deferred tax assets as of the dates indicated:
As of December 31,
As of
September 30,
2021 2022 2023 2024
(RMB’000)
Impairment of assets /H1118/H1118/H1118/H1118/H1118/H11187 2 1–– –
Provision for bad debts on
receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118688 829 1,124 821
Provision for inventory
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118893 982 2,696 981
Provision for contingent
liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,143 55,100 54,906 53,472
Deferred income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118219 297 251 1,028
Deductible losses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,084 2,448 2,659 –
Changes in fair value /H1118/H1118/H1118/H1118/H1118467 5,029 14,543 29,539
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 70,052 63,732 58,033
Depreciation and
amortization differences
with tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 33,919
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 12,492 11,505 9,925
Total deferred income tax
assets before offset /H1118/H1118/H1118/H1118/H11185,215 147,229 151,416 187,718
Amount of offset between
deferred income tax assets
and liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 93,251 133,934 132,163
Deferred income tax assets
presented net of offset /H1118/H1118 5,215 53,978 17,482 55,555
Our deferred tax assets increased significantly by 935.1% from RMB5.2 million as of
December 31, 2021 to RMB54.0 million as of December 31, 2022. This was primarily due to
an increase in lease liabilities of RMB70.1 million resulting from our acquisition of Golden
Star Resources.
Our deferred tax assets decreased by 67.6% from RMB54.0 million as of December 31,
2022 to RMB17.5 million as of December 31, 2023. This was primarily due to the increase in
fair value of Jilong Mining being offset by deferred tax liabilities.
FINANCIAL INFORMATION
– 531 –


--- page 543 ---
Our deferred tax assets increased by 217.8% from RMB17.5 million as of December 31,
2023 to RMB55.6 million as of September 30, 2024. This was primarily due to an increase in
depreciation and amortization differences with tax of RMB33.9 million mainly resulting from
different depreciation methods used for tax and accounting basis in LXML.
Other non-current assets
Our other non-current assets comprised advance payment for engineering construction
and equipment, mine geological environment treatment and restoration fund, large certificate
of bank deposits and interest and others. The following table sets forth a breakdown of our
other non-current assets as of the dates indicated:
As of December 31,
As of
September 30,
2021 2022 2023 2024
(RMB’000)
Advance payment for
engineering construction
and equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111826,819 56,402 105,810 41,674
Funds for land restoration
and environmental
rehabilitation after mine
closure /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111898,384 83,130 102,974 110,208
Large certificate of bank
deposits and interest /H1118/H1118/H1118/H1118/H111842,118 42,118 – –
Prepayment for equity
acquisition /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 66,844
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818,909 5,976 3,286 1,957
Subtotal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118186,230 187,626 212,070 220,683
Less: amount due within
one year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 42,118 – –
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118186,230 145,508 212,070 220,683
Our other non-current assets decreased by 21.9% from RMB186.2 million as of
December 31, 2021 to RMB145.5 million as of December 31, 2022. This was primarily due to
a decrease in large certificate of bank deposits and interest of RMB42.1 million, as the large
certificates of bank deposit maturing in 2023 were reclassified as other non-current assets
maturing within one year.
Our other non-current assets increased by 45.7% from RMB145.5 million as of December
31, 2022 to RMB212.1 million as of December 31, 2023. This was primarily due to an increase
in advance payment for engineering construction and equipment of RMB49.4 million, resulting
from the prepayment for the expansion of the selection plant of Shandong Changlong Sanhui
Construction Engineering Co., Ltd.
FINANCIAL INFORMATION
– 532 –


--- page 544 ---
Our other non-current assets increased by 4.1% from RMB212.1 million as of December
31, 2023 to RMB220.7 million as of September 30, 2024. This was primarily due to an increase
in prepayment for equity acquisition of RMB66.8 million, resulting from the advance payment
for the investment in China Investment Mining (Laos) Sole Co., Ltd.
Inventories
Our inventories primarily consist of raw materials, consumable materials, work in
progress and finished goods with taking into consideration the impairment provision. The
following table sets forth a breakdown of our inventories as of the dates indicated:
As of December 31,
As of
September 30,
2021 2022 2023 2024
(RMB’000)
Raw materials /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118516,090 951,720 971,389 971,689
Consumable materials /H1118/H1118/H1118/H1118/H11181,486 680 610 545
Work in progress /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,112,679 1,288,300 1,457,052 1,567,218
Finished goods /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111880,577 174,052 168,779 106,280
Subtotal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,710,832 2,414,752 2,597,830 2,645,732
Impairment provision
Raw materials /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(127,331) (143,175) (178,411) (194,212)
Work in progress /H1118/H1118/H1118/H1118/H1118/H1118/H1118(170,777) (90,588) (906) –
Finished goods /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(630) (16,361) (11,604) (1,850)
Subtotal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(298,738) (250,124) (190,921) (196,062)
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,412,094 2,164,628 2,406,909 2,449,670
Our inventories increased by 53.3% from RMB1,412.1 million as of December 31, 2021
to RMB2,164.6 million as of December 31, 2022. This was primarily due to an increase in raw
materials of RMB435.6 million arising from (i) our acquisition of Golden Star Resources, and
(ii) an increase in raw materials at the Sepon Gold and Copper Mine for its expanded ore
processing and production volume.
Our inventories increased by 11.2% from RMB2,164.6 million as of December 31, 2022
to RMB2,406.9 million as of December 31, 2023. This was primarily due to an increase in work
in progress of RMB168.8 million, mainly due to an increase in work in progress at the Sepon
Gold and Copper Mine for its expanded mined and processing volume of gold ore.
Our inventories increased by 1.8% from RMB2,406.9 million as of December 31, 2023
to RMB2,449.7 million as of September 30, 2024. This was primarily due to an increase in
work in progress of RMB110.2 million, attributable to the increase in the balance of
semi-finished gold ore inventory in Laos by RMB78.7 million as of September 30, 2024.
FINANCIAL INFORMATION
– 533 –


--- page 545 ---
Our impairment provision decreased by 16.3% from RMB298.7 million as of December
31, 2021 to RMB250.1 million as of December 31, 2022. This was primarily due to the
decreased impairment losses related to the semi-finished products of certain gold mines, as a
result of the rising gold price, offset by the increased impairment losses due to the
obsolescence of raw materials.
Our impairment provision decreased by 23.7% from RMB250.1 million as of December
31, 2022 to RMB190.9 million as of December 31, 2023. This was primarily due to the
decreased impairment losses related to the products and semi-finished products of certain gold
mines, as a result of the rising gold price, offset by (i) the increased impairment losses due to
the obsolescence of raw materials and (ii) the increased impairment of molybdenum-related
finished goods as a result of the decreased molybdenum price.
Our impairment provision increased by 2.7% from RMB190.9 million as of December 31,
2023 to RMB196.1 million as of September 30, 2024, primarily due to the obsolescence of raw
materials.
The obsolescence of raw materials is primarily due to the obsolescence of some spare
parts and components for production machinery and maintenance equipment of LXML, which
were purchased for the open-pit mining for LXML. They have long turnover days as they will
only be used to replace the original parts and components when the original parts and
components are damaged. Since the commencement of the transferring open-pit mining to
underground mining in 2022, these spare parts and components for the production machinery
and maintenance equipment have been held in storage. In contrast, consumables in other raw
materials, such as explosive materials and diesel, generally have shorter turnover days.
The following table sets forth an aging analysis of inventories as of the dates indicated:
As of December 31,
As of
September 30,
2021 2022 2023 2024
(RMB’000)
Less than 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,063,523 2,009,231 1,889,009 1,481,260
1 to 2 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118237,658 60,963 392,590 642,312
2 to 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111877,709 37,474 30,758 222,855
Over 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111833,204 56,960 94,552 103,243
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,412,094 2,164,628 2,406,909 2,449,670
FINANCIAL INFORMATION
– 534 –


--- page 546 ---
The following table sets forth the turnover days of our inventories for the years/periods
indicated:
Y ear Ended December 31,
Nine Months
Ended
September 30,
2021 2022 2023 2024
Inventory turnover days /H1118/H1118/H1118/H1118158 146 171 185
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118158 146 171 185
Note:
1. Inventory turnover days are equal to the average balance of inventory at the beginning and the end of
the relevant period divided by cost of sales for such period and multiplied by 365 days for the years
ended December 31, 2021, 2022 and 2023 and the nine months ended September 30, 2024.
Our inventory turnover days were 158 days, 146 days, 171 days, and 185 days in 2021,
2022, 2023 and for the nine months ended September 30, 2024, respectively. The decrease in
our inventory turnover days in 2022 was primarily attributable to (i) the acquisition of Golden
Star Resources, which led to an increase in the inventory in 2022; (ii) the increase of the
operation costs arising from the increase of gold selling volume; and (iii) the increase in
demand in the gold market and the improvement in our production efficiency, which led to a
reduction in the inventory turnover days. The increase in our inventory turnover days in 2023
was primarily due to the new underground mining at the Sepon Gold and Copper Mine,
contributing to the increase of the unit cost of mining. The increase in our inventory turnover
days for the nine months ended September 30, 2024 was mainly due to the increase in the
volume of ore at Sepon Gold and Copper Mine.
As of January 31, 2025, RMB1,258.9 million or 51.4% of the inventories as of September
30, 2024 had been subsequently utilized. The majority of our inventory comprises work-in-
progress products sourced from LXML, primarily because (i) post our acquisition of LXML in
2018, we consolidated the accounts of LXML which accumulated a substantial amount of gold
ore, coupled with the ongoing processing of such gold ores; and (ii) we managed our inventory
driven by commercial considerations, which involves blending based on grade variations.
Therefore, we believe there are no major concerns in the recoverability of our inventories.
Trade receivables from gold and commodities sales
Our trade receivables from gold and commodities sales refer to our trade receivables other
than the comprehensive recycling of resources business conducted through Guangyuan
Technology. Impairment losses in respect of trade debtors are recorded using an allowance
account unless we are satisfied that recovery of the amount is remote, in which case the
impairment loss is written off against trade debtors directly.
FINANCIAL INFORMATION
– 535 –


--- page 547 ---
Our trade receivables from gold and commodities sales increased by 17.3% from
RMB25.3 million as of December 31, 2021 to RMB29.6 million as of December 31, 2022, and
further increased by 290.5% to RMB115.7 million as of December 31, 2023. Trade receivables
from gold and commodities sales increased by 41.3% from RMB115.7 million as of December
31, 2023 to RMB163.5 million as of September 30, 2024. This was primarily due to the
receivables from customers at the end of the period, generated by our sales of gold products,
copper concentrate powder, zinc concentrate powder, and copper cathodes.
We maintain strict control over our outstanding receivables. Overdue balances are
reviewed regularly by senior management.
Our trade receivables from gold and commodities sales are typically due within 60 days.
No interests are charged on the trade receivables from other sales. The following table sets
forth an aging analysis of trade receivables from other sales, based on invoice dates as of the
dates indicated:
As of December 31,
As of
September 30,
2021 2022 2023 2024
(RMB’000)
Less than 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825,210 29,637 115,732 163,455
1 to 2 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––– –
2 to 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 0–– –
Over 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––– –
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825,260 29,637 115,732 163,455
The following table sets forth the turnover days of our trade receivables from gold and
commodities sales for the years/periods indicated:
Y ear ended December 31,
Nine Months
ended
September 30,
2021 2022 2023 2024
Trade receivables turnover
days /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118224 5
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118224 5
Note:
1. Trade receivables turnover days are equal to the average balance of trade receivables at the beginning
and the end of the relevant period divided by revenue for such period and multiplied by 365 days for
the years ended December 31, 2021, 2022 and 2023 and the nine months ended September 30, 2024.
FINANCIAL INFORMATION
– 536 –


--- page 548 ---
Trade receivables from comprehensive recycling of resources business
Our trade receivables from our comprehensive recycling of resources business conducted
through Guangyuan Technology refers to our receivable government subsidies, which is
generally associated with low recovery risks.
Trade receivables from our comprehensive recycling of resources business increased by
8.9% from RMB311.4 million as of December 31, 2021 to RMB339.2 million as of December
31, 2022 and further increased by 17.2% from RMB339.2 million as of December 31, 2022 to
RMB397.5 million as of December 31, 2023, resulting from the delayed subsidy disbursements
from PRC Government.
Trade receivables from our comprehensive recycling of resources business increased by
11.5% from RMB397.5 million as of December 31, 2023 to RMB443.3 million as of September
30, 2024, primarily due to additional government subsidies.
The following table sets forth an aging analysis of trade receivables from comprehensive
recycling of resources business, based on invoice dates as of the dates indicated:
As of December 31,
As of
September 30,
2021 2022 2023 2024
(RMB’000)
Less than 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111869,680 74,704 92,642 69,890
1 to 2 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111883,630 69,680 74,704 88,476
2 to 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118158,121 83,630 69,680 73,895
Over 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111816 111,223 160,455 211,025
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118311,447 339,237 397,481 443,286
The following table sets forth the turnover days of our trade receivables for the
years/periods indicated:
Y ear ended December 31,
Nine Months
ended
September 30,
2021 2022 2023 2024
Trade receivables turnover
days /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111831 21 22 25
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111831 21 22 25
Note:
1. Trade receivables turnover days are equal to the average balance of trade receivables at the beginning
and the end of the relevant period divided by revenue for such period and multiplied by 365 days for
the years ended December 31, 2021, 2022 and 2023 and the nine months ended September 30, 2024.
FINANCIAL INFORMATION
– 537 –


--- page 549 ---
Our trade receivables turnover days were 2 days, 11 days, 22 days and 25 days in 2021,
2022 and 2023 and for the nine months ended September 30, 2024, respectively. The increase
in our trade receivables turnover days during Track Record Period was primarily due to the
government subsidies of Guangyuan Technology which needs certain time to process.
As of January 31, 2025, RMB260.3 million or 42.9% of the trade receivables as of
September 30, 2024 had been subsequently settled. In the case of trade receivables from the
comprehensive resource recycling and utilization, the predominant portion consists of the
allowances specified in the government policies from Guangyuan Technology. The extended
approval timeline mandated by the authorities contributes to a lower settlement rate. We
believe that the expected credit losses are limited because the trade receivable balances are due
from the Ministry of Ecology and Environment of the PRC, which has high credibility and
historically we did not incur any actual loss with this organization. Additionally, there was a
minor component of accounts receivable from gold and commodities sales. Trade receivables
can be collected within one week after the delivery of the products. Therefore, we believe there
are no major concerns in the recoverability of our trade receivables.
Prepayments, other receivables, and other assets
Our prepayments, other receivables, and other assets consist of prepayments, deposits and
other receivables, large certificates of bank deposits and interest and others. The following
table sets forth a breakdown of our prepayments, other receivables and other assets as of the
dates indicated:
As of December 31,
As of
September 30,
2021 2022 2023 2024
(RMB’000)
Prepayments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111850,037 99,560 83,944 240,266
Deposits and other
receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118120,194 58,134 180,497 202,593
Receivable from disposal
of the shares of Phase II
ESOP /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 323,647
Large certificates of bank
deposits and interest /H1118/H1118/H1118/H1118/H1118– 42,118 – —
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111851 46,471 25,177 53,080
Less: Impairment of other
receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(3,338) (4,140) (7,022) (5,416)
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118166,944 242,143 282,596 814,170
FINANCIAL INFORMATION
– 538 –


--- page 550 ---
Our prepayments, other receivables and other assets increased by 45.0% from RMB166.9
million as of December 31, 2021 to RMB242.1 million as of December 31, 2022. This was
primarily due to an increase in prepayments of RMB49.5 million, which is attributed to our
acquisition of Golden Star Resources.
Our prepayments, other receivables and other assets increased by 16.7% from RMB242.1
million as of December 31, 2022 to RMB282.6 million as of December 31, 2023. This was
primarily due to an increase in deposits and other receivables of RMB122.4 million, resulting
from (i) a decrease in prepayments of RMB15.6 million; (ii) an increase of other receivables
of RMB45.0 million attributable to the increase in gold selling price in 2023 and increase of
funds in gold futures account at GSWL and LXML; (iii) the utilisation of the futures margin;
and (iv) decrease in deductible input tax of RMB21.3 million.
Our prepayments, other receivables and other assets increased by 188.1% from
RMB282.6 million as of December 31, 2023 to RMB814.2 million as of September 30, 2024.
This was primarily due to (i) an increase in prepayments of RMB156.3 million attributable to
the prepayments for rare earth products by Chijin Xiawu; and (ii) an increase in deposits and
other receivables of RMB345.7 million attributable to the receivables from securities
companies upon the sale of stocks in the Phase II ESOP . As the stocks under the Phase II ESOP
was sold on September 30, 2024, the payment related to the equity interests had not yet been
transferred back to our Company’s accounts from the securities companies’ accounts as of
September 30, 2024. See paragraph headed “C. Further Information about our Directors,
Supervisors and Substantial Shareholders — 4. Employee Stock Ownership Plans” in Appendix
VII to this Prospectus for details.
As of January 31, 2025, RMB514.4 million or 63.2% of the prepayments, deposits and
other assets as of September 30, 2024 had been subsequently settled.
Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss refer to listed equity investments at fair
value.
Our financial assets at fair value through profit or loss increased by 328.3% from
RMB11.2 million as of December 31, 2021 to RMB48.1 million as of December 31, 2022. This
was mainly due to an increase in equity investment in 2022, as a result of the increase in stock
price of our investees.
Our financial assets at fair value through profit or loss decreased by 64.9% from
RMB48.1 million as of December 31, 2022 to RMB16.9 million as of December 31, 2023,
associated with our disposal of equity investments in 2023.
Our financial assets at fair value through profit or loss further decreased by 21.9% from
RMB16.9 million as of December 31, 2023 to RMB13.2 million as of September 30, 2024. This
was primarily due to a decrease in the stock price of our investee.
FINANCIAL INFORMATION
– 539 –


--- page 551 ---
We have formulated a set of investment management measures which states the
investment management organizational structure, responsibilities and authorities, investment
decision-making management, investment process management, investment outcome
evaluation, and investment assessment, rewards and penalties.
Our management has extensive experience in financial investment. Our vice president,
Mr. Chen Zhiyong, served as a Deputy General Manager of Soremi Investment Company
Limited (ʮ̡) from February 2014 to August 2018. Our non-executive
director, Mr. Zhang Xudong, was Chairman and CEO of Anjia Group/Shanghai Anjia
Investment Management Co., Ltd, an investment advisory and asset management services firm,
from March 2007 to August 2009. He also served as Managing Director, Head of the
Institutional Client Group, Debt and Equity for China and Head of Global Markets Equity for
China at Deutsche Bank AG.
Investments exceeding RMB30 million shall be approved by the Board. With the Board’s
authorization, those not exceeding RMB30 million can be reviewed and approved by the
Executive Committee chaired by the Chairman.
Derivative financial assets
Our derivative financial assets refer to hedging instruments for cash flow hedge and fair
value hedge.
Our derivative financial assets decreased by 90.9% from RMB6.4 million as of December
31, 2021 to RMB0.6 million as of December 31, 2022. This was primarily due to a decrease
in the fair value of futures contracts arising from the closing of zinc futures positions in
Hanfeng Mining.
Our derivative financial assets increased by 2,206.5% from RMB0.6 million as of
December 31, 2022 to RMB13.5 million as of December 31, 2023. This was primarily due to
increase in fair value of futures contracts arising from fair value of gold futures contracts in
Jilong Mining.
Our derivative financial assets increased by 222.5% from RMB13.5 million as of
December 31, 2023 to RMB43.4 million as of September 30, 2024. This was primarily due to
an increase in fair value of gold futures contracts in Jilong Mining due to the increase of the
gold price.
FINANCIAL INFORMATION
– 540 –


--- page 552 ---
Restricted cash
Our restricted cash consist of bank deposits for loans, special fund deposits for
environmental rehabilitation and restoration, bank deposits for gold lease business, certificates
of deposit due within one year and deposits for investment funds. The following table sets forth
a breakdown of our restricted cash as of the dates indicated:
As of December 31,
As of
September 30,
2021 2022 2023 2024
(RMB’000)
Bank deposits for loans /H1118/H1118/H1118 – 13,965 13,965 –
Deposits for notes payable /H1118 – 20,400 – –
Special fund deposits for
environmental
rehabilitation and
restoration /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,050 18,194 9,825 6,619
Bank deposits for the gold
lease business /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,003 100,001 263,858 296,997
Certificates of deposit due
within one year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118100,095 80,000 100,000 –
Deposits for investment
funds /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,733 – – –
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118116,881 232,560 387,648 303,616
Our restricted cash increased by 99.0% from RMB116.9 million as of December 31, 2021
to RMB232.6 million as of December 31, 2022. This was primarily due to an increase in bank
deposits for gold lease business of RMB92.0 million, which is attributed to in the scale of our
gold leasing requiring a corresponding increase in deposits.
Our restricted cash increased by 66.7% from RMB232.6 million as of December 31, 2022
to RMB387.6 million as of December 31, 2023. This was primarily due to an increase in bank
deposits for gold lease business of RMB163.9 million, which is attributed to in the scale of our
gold leasing requiring a corresponding increase in deposits.
Our restricted cash decreased by 21.7% from RMB387.6 million as of December 31, 2023
to RMB303.6 million as of September 30, 2024. This was primarily due to an increase in bank
deposits for gold lease business of RMB33.1 million, which is attributed to in the scale of our
gold leasing requiring a corresponding increase in deposits.
FINANCIAL INFORMATION
– 541 –


--- page 553 ---
Trade and notes payables
Our trade and notes payables consist of trade payables and notes payables. The following
table sets forth a breakdown of our trade and notes payables as of the dates indicated:
As of December 31,
As of
September 30,
2021 2022 2023 2024
(RMB’000)
Trade payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118440,401 693,390 552,457 636,817
Notes payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 158,000 – –
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118440,401 851,390 552,457 636,817
Our trade and notes payables increased by 93.3% from RMB440.4 million as of December
31, 2021 to RMB851.4 million as of December 31, 2022. This was primarily due to an increase
in trade payables of RMB253.0 million and an increase in notes payables of RMB158.0
million, resulting from: (i) our acquisition of Golden Star Resources; and (ii) a note payable
issued by Wulong Mining to an independent third party to pay for certain mining and
excavation project costs.
Our trade and notes payables decreased by 35.1% from RMB851.4 million as of
December 31, 2022 to RMB552.5 million as of December 31, 2023 due to a decrease in trade
payables of RMB140.9 million. This was primarily because: (i) Golden Star Resources entered
into a revised materials procurement agreements with a lower purchase price for materials; and
(ii) the Sepon Gold and Copper Mine completed certain expansion projects, resulting in a
substantial decrease in payables.
Our trade and notes payables increased by 15.0% from RMB552.5 million as of
December 31, 2023 to RMB636.8 million as of September 30, 2024. This was primarily due
to the increase in payables in connection with purchases from suppliers and payments to
contractors of engineering services.
All of our trade and notes payables are aged less than one year. The following table sets
forth an aging analysis of our trade and notes payables as of the dates indicated:
As of December 31,
As of
September 30,
2021 2022 2023 2024
(RMB’000)
Less than 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118440,401 851,390 552,457 636,817
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118440,401 851,390 552,457 636,817
FINANCIAL INFORMATION
– 542 –


--- page 554 ---
The following table sets forth the turnover days of our trade and notes payables for the
years/periods indicated:
Y ear Ended December 31,
Nine Months
Ended
September 30,
2021 2022 2023 2024
Trade and notes payables
turnover days /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111850 53 53 36
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111850 53 53 36
Note:
1. Trade and notes payables turnover days are equal to the average balance of trade and notes payables at
the beginning and the end of the relevant period divided by cost of sales for such period and multiplied
by 365 days for the years ended December 31, 2021, 2022 and 2023 and the nine months ended
September 30, 2024.
Our trade and notes payables turnover days increased from 50 days as of December 31,
2021 to 53 days as of December 31, 2022, primarily due to our acquisition of Golden Star
Resources in 2022 which substantially increased our trade payable. Our trade and notes
payables turnover days decreased from 53 days as of December 31, 2023 to 36 days as of
September 30, 2024. This was primarily because we shortened payment period for our
suppliers to fully utilize the Ghana Cedis we have on hand to manage foreign exchange risk,
as Ghana Cedis depreciated.
As of January 31, 2025, RMB420.5 million or 66.0% of the trade and notes payables as
of September 30, 2024 had been subsequently settled.
Contract liabilities
The contract liabilities mainly consist of metal streaming and the advance payments
received for the sale of metals. We require certain customers to pay in advance of delivery. The
receipts in advance are recognized as a contract liability until the products are delivered to the
customer. In 2021, 2022 and 2023 and for the nine months ended September 30, 2024. RMB4.5
million, RMB1.2 million, RMB9.2 million and RMB17.3 million or 100%, 100%, 100%,
100%, of the advance payments for metal sales, respectively, were subsequently settled and
recognized as revenue.
As of January 31, 2025, RMB31.4 million or 5.0% of contract liabilities as of September
30, 2024 had been were subsequently settled and recognized as revenue.
FINANCIAL INFORMATION
– 543 –


--- page 555 ---
The following table sets forth a breakdown of our contract liabilities as of the dates
indicated:
As of December 31,
As of
September 30,
2021 2022 2023 2024
(RMB’000)
Short-term advances
received from customers
Sale of goods /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,547 1,227 9,162 17,323
Metal Streaming
Arrangement /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 60,825 64,015 71,849
Sub-total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,547 62,052 73,177 89,172
Long-term advances
received from
customers
Metal Streaming
Arrangement /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 606,298 576,999 538,996
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,547 668,350 650,176 628,168
Note: We acquired Golden Star Resources in January 2022. In May 2015, Golden Star Resources, through its
subsidiary Caystar Finance, engaged in a gold purchase and sale agreement with RGLD Gold AG. Under
this arrangement, Golden Star Resources received US$145,000,000 from RGLD Gold AG as the
purchase price. Golden Star Resources is obligated to supply future gold production from its subsidiaries
at a cash purchase price equivalent to 20% of the spot gold price until delivering 240,000 ounces.
Subsequently, 5.5% of the gold production will be supplied at a cash purchase price of 30% of the spot
gold price. As of September 30, 2024, Golden Star Resources had delivered approximately 185 koz
accumulated amount of gold to RGLD Gold AG.
Our contract liabilities increased by 14,598.7% from RMB4.5 million as of December 31,
2021 to RMB668.4 million as of December 31, 2022. This was primarily due to an increase in
short-term and long-term advances received from customers arising from gold streaming
transactions of GSWL since our acquisition of Golden Star Resources.
Our contract liabilities decreased by 2.7% from RMB668.4 million as of December 31,
2022 to RMB650.2 million as of December 31, 2023. This was primarily due to a decrease in
long-term advances received from customers arising from gold streaming transactions of
GSWL. The decrease was partially offset by an increase in short-term advances received from
customers arising from sales of goods at Hanfeng Mining.
Our contract liabilities decreased by 3.4% from RMB650.2 million as of December 31,
2023 to RMB628.2 million as of September 30, 2024, primarily due to the decrease in advance
receipts from the metal stream transaction of GSWL.
FINANCIAL INFORMATION
– 544 –


--- page 556 ---
Derivative financial liabilities
Our derivative financial liabilities are related to hedging instruments for cash flow hedge
arising from commodity future contracts.
Our derivative financial liabilities were RMB1.8 million, nil, nil and RMB17 million as
of December 31, 2021, 2022 and 2023 and September 30, 2024, respectively.
Other payables and accruals
Our other payables and accruals consist of amounts due to related parties, payables to
contractors, consideration payables for acquiring a subsidiary, engineering quality guarantee
deposit, safety deposit, salaries, wages and benefits payables, taxes other than income tax
payables and others. The following table sets forth a breakdown of our other payables and
accruals as of the dates indicated:
As of December 31,
As of
September 30,
2021 2022 2023 2024
(RMB’000)
Amounts due to related parties
– trade /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–4 12 2 2
– non-trade /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 410,940 128,525 –
Payables to contractors /H1118/H1118/H1118/H1118/H1118/H1118/H11182,926 6,319 85,195 116,158
Consideration payables for
acquiring a subsidiary /H1118/H1118/H1118/H1118/H1118/H1118– – 40,800 40,800
Engineering Quality Guarantee
Deposit /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111827,803 33,507 40,984 39,885
Salaries, wages and benefits
payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118104,693 114,454 174,859 111,078
Taxes other than income tax
payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111853,999 93,558 205,293 142,504
Payables for Phase II ESOP /H1118/H1118/H1118 – – – 323,647
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,748 36,517 21,769 18,229
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118191,169 695,336 697,447 792,303
Our other payables and accruals increased by 263.7% from RMB191.2 million as of
December 31, 2021 to RMB695.3 million as of December 31, 2022. This was primarily due to
an increase in amounts due to related parties of RMB411.0 million, resulting from the financial
support provided by the member of the Single Largest Shareholder Group, Ms. Li Jinyang,
which led to an increase in the amount payable to the related party.
FINANCIAL INFORMATION
– 545 –


--- page 557 ---
Our other payables and accruals increased by 0.3% from RMB695.3 million as of
December 31, 2022 to RMB697.4 million as of December 31, 2023. This was primarily due to:
(i) an increase in taxes other than income tax payables of RMB111.7 million, which is
attributed the increase in sales revenue of gold, leading to an increase in the resource tax
payable; and (ii) an increase in payable to contractors of RMB78.9 million. The increase was
partially offset by a decrease in amounts due to related parties of RMB282.4 million because
of the repayment of the financial support provided by the member of the Single Largest
Shareholder Group, Ms. Li Jinyang.
Our other payables and accruals increased by 13.6% from RMB697.4 million as of
December 31, 2023 to RMB792.3 million as of September 30, 2024. This was primarily due
to (i) a decrease in amounts due to related parties of RMB128.6 million for repayment of the
funds provided by the member of the Single Largest Shareholder Group, Ms. Li Jinyang; and
(ii) an increase in payables for Phase II ESOP of RMB323.6 million.
As of January 31, 2025, RMB713.9 million or 93.5% of other payables and accruals as
of September 30, 2024 had been subsequently settled.
Income tax payables
Our income tax payables increased by 72.9% from RMB102.4 million as of December 31,
2021 to RMB177.1 million as of December 31, 2022, mainly due to our acquisition of Golden
Star Resources in January 2022.
Our income tax payables increased by 51.2% from RMB177.1 million as of December 31,
2022 to RMB267.7 million as of December 31, 2023, mainly due to the increase in profit before
tax for the increase in gold sales volumes and unit selling prices.
Our income tax payables increased by 70.3% from RMB267.7 million as of December 31,
2023 to RMB455.8 million as of September 30, 2024, which is attributed to the income tax not
yet paid.
Lease liabilities
Our lease liabilities consist of current lease liabilities and non-current liabilities. The
following table sets forth a breakdown of our lease liabilities as of the dates indicated:
As of December 31,
As of
September 30,
2021 2022 2023 2024
(RMB’000)
Current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,424 31,177 38,083 38,204
Non-current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,975 230,805 207,219 185,340
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,399 261,982 245,302 223,544
FINANCIAL INFORMATION
– 546 –


--- page 558 ---
Our current portion of lease liabilities increased by 2,089.4% from RMB1.4 million as of
December 31, 2021 to RMB31.2 million as of December 31, 2022. This was mainly due to the
increased lease liabilities due to the acquisition of Golden Star Resources in 2022.
Our current portion of lease liabilities increased by 22.2% from RMB31.2 million as of
December 31, 2022 to RMB38.1 million as of December 31, 2023. This was mainly due to the
increased lease liabilities within one year arising from the acquisition of Jintai Mining and
difference of rental payment arrangements.
Our current portion of lease liabilities increased by 0.3% from RMB38.1 million as of
December 31, 2023 to RMB38.2 million as of September 30, 2024. This was attributable to the
rent paid by Chijin HK and GSWL in 2024 and the reclassification of non-current lease
liabilities to current lease liabilities.
Our non-current portion of lease liabilities increased by 7,658.2% from RMB3.0 million
as of December 31, 2021 to RMB230.8 million as of December 31, 2022. This was mainly due
to our acquisition of Golden Star Resources in 2022.
Our non-current portion of lease liabilities decreased by 10.2% from RMB230.8 million
as of December 31, 2022 to RMB207.2 million as of December 31, 2023. This was mainly due
to the increase in lease liabilities of RMB26.0 million arising from our acquisition of
Xinhenghe Mining in 2023, offset by rent payment of RMB58.1 million for the period.
Our non-current portion of lease liabilities decreased by 10.6% from RMB207.2 million
as of December 31, 2023 to RMB185.3 million as of September 30, 2024. This was attributable
to the reclassification of non-current lease liabilities to current lease liabilities.
Deferred tax liabilities
Our deferred tax liabilities consist of fair value adjustments on financial assets at fair
value through profit or loss, Accelerated depreciation of property, plant and equipment,
environmental rehabilitation, fair value adjustment arising from acquisition of subsidiaries,
right-of-use assets and others. The following table sets forth a breakdown of our deferred tax
liabilities as of the dates indicated:
As of December 31,
As of
September 30,
2021 2022 2023 2024
(RMB’000)
Fair value adjustments on
financial assets at fair
value through profit
or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118966 88 2,108 6,516
FINANCIAL INFORMATION
– 547 –


--- page 559 ---
As of December 31,
As of
September 30,
2021 2022 2023 2024
(RMB’000)
Accelerated depreciation of
property, plant and
equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118950 378,810 357,796 371,795
Environmental
rehabilitation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 11,045 11,869 11,435
Fair value adjustment
arising from acquisition
of subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 2,080,068 2,004,421 1,925,417
Right-of-use assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118– 65,554 58,817 51,561
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 13,667 13,577 10,491
Total deferred tax
liabilities before offset /H1118 1,916 2,549,232 2,448,588 2,377,215
Amount of offset between
deferred tax assets and
liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 93,251 133,934 132,163
Deferred tax liabilities
presented net of offset /H1118/H1118 1,916 2,455,981 2,314,654 2,245,052
Our deferred tax liabilities increased by 128,082.7% from RMB1.9 million as of
December 31, 2021 to RMB2,456.0 million as of December 31, 2022. This was mainly due to
an increase of RMB2,080.1 million, from assets appreciation resulting from the acquisition of
Golden Star Resources in 2022.
Our deferred tax liabilities decreased by 5.8% from RMB2,456.0 million as of December
31, 2022 to RMB2,314.7 million as of December 31, 2023. This was mainly due to a decrease
of RMB75.6 million, which is attributed to: (i) amortization of the assessed appreciation of
GSWL’s mining rights; and (ii) depreciation and amortization of fixed and intangible assets of
RMB19.6 million.
Our deferred tax liabilities decreased by 3.0% from RMB2,314.7 million as of September
30, 2023 to RMB2,245.1 million as of September 30, 2024. This was primarily due to
amortization of the assessed appreciation of Golden Star Resources resulting from business
combinations not under common control.
FINANCIAL INFORMATION
– 548 –


--- page 560 ---
Provisions
Our provisions consist of environmental rehabilitation and restoration. The following
table sets forth a breakdown of our provisions as of the dates indicated:
As of December 31,
As of
September 30,
2021 2022 2023 2024
(RMB’000)
Current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 9,567 75,747 71,806
Non-current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,631,259 1,984,834 1,868,099 1,781,346
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,631,259 1,994,401 1,943,846 1,853,152
Our current provisions increased from nil as of December 31, 2021 to RMB9.6 million as
of December 31, 2022, mainly due to the acquisition of GSWL. Our current provisions
increased by 691.8% from RMB9.6 million as of December 31, 2022 to RMB75.7 million as
of December 31, 2023. This was mainly due to the amendment of environmental rehabilitation
and restoration plan by Sepon Gold and Copper Mine in 2023.
Our current provisions slightly decreased by 5.2% from RMB75.7 million as of December
31, 2023 to RMB71.8 million as of September 30, 2024. This was mainly due to the normal
environmental rehabilitation and restoration expenditure.
Our non-current provisions increased by 21.7% from RMB1,631.3 million as of
December 31, 2021 to RMB1,984.8 million as of December 31, 2022. This was mainly due to
(i) an increase in exchange differences of RMB155.9 million, and (ii) the acquisition of GSWL.
Our non-current provisions decreased by 5.9% from RMB1,984.8 million as of December 31,
2022 to RMB1,868.1 million as of December 31, 2023. This was mainly due to the expenditure
on reclamation obligations. Our non-current provisions decreased by 4.6% from RMB1,868.1
million as of December 31, 2023 to RMB1,781.3 million as of September 30, 2024. This was
mainly due to the normal reclamation expenditure.
FINANCIAL INFORMATION
– 549 –


--- page 561 ---
Other non-current liabilities
Our other non-current liabilities of payables for mining rights, payables for equity
transfer and deferred government grants. The following table sets forth a breakdown of our
other non-current liabilities as of the dates indicated:
As of December 31,
As of
September 30,
2021 2022 2023 2024
(RMB’000)
Payables for mining rights /H1118/H1118/H1118/H1118/H111885,716 73,186 71,960 64,167
Payables for equity transfer /H1118/H1118/H1118/H1118173,566 – – –
Deferred government
grants /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,120 2,073 1,756 6,918
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118261,402 75,259 73,716 71,085
Current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118186,589 10,849 9,485 5,717
Non-current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111874,813 64,410 64,231 65,368
Our other non-current liabilities decreased by 13.9% from RMB74.8 million as of
December 31, 2021 to RMB64.4 million as of December 31, 2022. This was mainly due to an
decrease in payables for equity transfer of RMB173.6 million, resulting from the acquisition
of LXML in 2018, for which payments were due to the original shareholder MMG Limited
(“MMG”). The equity transfer payment due to MMG had been fully made in 2022.
Our other non-current liabilities decreased by 0.3% from RMB64.4 million as of
December 31, 2022 to RMB64.2 million as of December 31, 2023. This was mainly due to a
decrease in payables for mining rights of RMB1.2 million and a decrease in deferred
government grants of RMB0.3 million, mainly resulting from: (i) the payment of mining rights
transfer fees and interest expenses in 2023; and (ii) a reduction in government subsidies
received in 2023.
Our other non-current liabilities increased by 1.8% from RMB64.2 million as of
December 31, 2023 to RMB65.4 million as of September 30, 2024. This was primarily
attributable to (i) the payment of mining rights transfer fees and interest expenses in 2024; and
(ii) deferred grant received from the government.
INDEBTEDNESS
During the Track Record Period, our indebtedness consisted of short-term loans, financial
liabilities at fair value through profit or loss, other payables and accruals. The significant
increase in our Company’s indebtedness compared to 2021 is primarily attributed to the
acquisition of Golden Star Resources at the beginning of 2022.
FINANCIAL INFORMATION
– 550 –


--- page 562 ---
The following table sets forth a breakdown of our indebtedness as of the dates indicated:
As of December 31,
As of
September 30,
As of
December 31,
2021 2022 2023 2024 2024
(RMB’000)
(unaudited)
Short-term
Short-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118– 488,409 850,009 822,730 1,108,199
Financial liabilities at
fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118387,683 620,250 939,996 1,026,210 707,020
Amounts due to related
parties (non-trade) /H1118/H1118/H1118 – 410,940 128,525 – –
Payables for Phase II
ESOP /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 323,647 –
Other payables and
accruals-amounts due
to non-controlling
shareholders of our
subsidiary /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 10,706 11,420 11,545
Current portion of long-
term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825,530 333,770 218,315 641,778 282,333
Current portion of lease
liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,424 31,177 38,083 38,204 37,840
Current portion of other
non-current liabilities –
Payables for mining
rights /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813,023 10,849 9,485 5,717 5,786
Current portion of other
non-current liabilities –
Payables for equity
transfer /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118173,566 – – – –
Long-term
Long-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,513,781 1,421,974 681,614 599,503
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H11182,975 230,805 207,219 185,340 179,596
Other non-current
liabilities – Payables
for mining rights /H1118/H1118/H1118/H111872,693 62,337 62,475 58,450 59,168
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118676,894 3,702,318 3,886,787 3,795,110 2,990,990
The agreements under our bank loans and other borrowings do not contain any material
covenants that will have a material adverse effect on our ability to make additional borrowings
or issue debt or equity securities in the future. Our Directors confirm that we did not have any
default in payment of trade payables, bank loans and other borrowings, and did not breach any
of the covenants in relation to the bank loans and other borrowings mentioned above, during
the Track Record Period and up to the Latest Practicable Date. We did not experience any
difficulty in obtaining bank loans and other borrowings during the Track Record Period and up
to the Latest Practicable Date, and there has not been any material change in our indebtedness
since December 31, 2024 and up to the date of this Prospectus.
FINANCIAL INFORMATION
– 551 –


--- page 563 ---
Short-term loans
Our short-term loans consist of unsecured and secured and short-term loans, and based on
their maturity dates, they are classified as current. The following table sets forth a breakdown
of our short-term loans as of the dates indicated:
As of December 31,
As of
September 30,
As of
December 31,
2021 2022 2023 2024 2024
(RMB’000)
(unaudited)
Short-term loans –
unsecured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 236,636 850,009 822,730 1,108,199
Short-term loans –
secured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 251,773 – – –
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 488,409 850,009 822,730 1,108,199
Secured short-term loans accounted for nil, 51.6%, nil, nil, and nil of our total short-term
loans as of December 31, 2021, 2022 and 2023, and September 30, 2024 and December 31,
2024, respectively. All of our secured short-term loans during the Track Record Period were at
fixed interest rates of 3.7% per annum.
Unsecured short-term loans accounted for nil, 48.5%, 100.0%, 100.0%, and 100% of our
total short-term loans as of December 31, 2021, 2022 and 2023, September 30, 2024 and
December 31, 2024, respectively, at interest rates of nil, 2.6%-3.9%, 2.5%-7.5%, 2.5%-4.5%
and 2.4%-5.7% per annum, respectively.
Our short-term loans increased by 74.0% from RMB488.4 million as of December 31,
2022 to RMB850.0 million as of December 31, 2023. This was mainly due to the increase in
profit before tax arising from our acquisition of Golden Star Resources and the expansion
project of Jilong Gold Mine.
Our short-term loans decreased by 3.2% from RMB850.0 million as of December 31,
2023 to RMB822.7 million as of September 30, 2024, attributable to a combined effect of (i)
the repayment of short-term borrowings upon maturity and (ii) our new short-term borrowings.
Our short-term loans increased by 34.7% from RMB822.7 million as of September 30,
2024 to RMB1,108.2 million as of December 31, 2024, primarily due to our optimization of
the borrowing model of the gold leasing, which resulted in an increase in short-term
borrowings by RMB285.5 million, and a decrease in financial liabilities at fair value through
profit or loss by RMB319.2 million. The overall short-term debt level remained stable as a
netting effect of these adjustments.
As of December 31, 2024, we had unutilized short-term credit facilities of RMB4,002
million.
FINANCIAL INFORMATION
– 552 –


--- page 564 ---
Long-term loans
Our long-term loans consist of unsecured and secured and long-term loans, and based on
their maturity dates, they are classified as current or non-current. The following table sets forth
a breakdown of our long-term loans as of the dates indicated:
As of December 31,
As of
September 30,
As of
December 31,
2021 2022 2023 2024 2024
(RMB’000)
(unaudited)
Current
Current portion of long-
term bank loans –
secured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 245,850 129,456 531,580 170,325
Current portion of long-
term bank loans –
unsecured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825,530 87,920 88,859 110,198 112,008
Subtotal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825,530 333,770 218,315 641,778 282,333
Non-current
Long-term loans –
secured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,386,724 1,381,994 485,047 433,882
Long-term loans –
unsecured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 127,057 39,980 196,567 165,621
Subtotal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,513,781 1,421,974 681,614 599,503
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825,530 1,847,551 1,640,289 1,323,392 881,836
Secured long-term loans accounted for nil, 88.4%, 92.1%, 76.8% and 68.5% of our total
long-term loans as of December 31, 2021, 2022 and 2023, September 30, 2024 and December
31, 2024, respectively, at fixed interest rates of nil, 4.1%-5.0%, 4.0%-9.2%, 4.0%-9.1% and
3.7%-4.3% per annum, respectively.
On the other hand, unsecured long-term loans accounted for 100%, 11.6%, 7.9%, 23.2%
and 31.5% of our total long-term loans as of December 31, 2021, 2022 and 2023, September
30, 2024 and December 31, 2024, respectively, at fixed interest rates of 3.5%, 3.5%-4.0%,
3.5%-4.1%, 3.5%-6.3% and 3.5%-5.7% per annum, respectively.
Our long-term loans increased by 7,136.8% from RMB25.5 million as of December 31,
2021 to RMB1,847.6 million as of December 31, 2022 mainly due to the loan for the
acquisition of Golden Star Resources in 2022. The principal amount of the loan is RMB1.2
billion for a term of 5 years, with an interest rate of 4.95% in 2022, which was adjusted to
4.35% since June 2023. The repayment plan involves repaying the principal every six months,
with interest accrued and paid quarterly.
FINANCIAL INFORMATION
– 553 –


--- page 565 ---
Our long-term loans decreased by 11.2% from RMB1,847.6 million as of December 31,
2022 to RMB1,640.3 million as of December 31, 2023, resulting from the partial repayment of
long-term loans.
Our long-term loans decreased by 19.3% from RMB1,640.3 million as of December 31,
2023 to RMB1,323.4 million as of September 30, 2024, primarily due to (i) the repayment of
long-term loans by GSWL and our Company, and (ii) LXML’s new long-term loans.
Our long-term loans decreased by 33.4% from RMB1,323.4 million as of September 30,
2024 to RMB881.8 million as of December 31, 2024, primarily due to further repayment of the
long-term loans by GSWL and our Company.
As of September 30, 2024, we had no unutilized long-term credit facilities.
Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss comprise of gold leasing.
Our financial liabilities at fair value through profit or loss increased by 60.0% from
RMB387.7 million as of December 31, 2021 to RMB620.3 million as of December 31, 2022,
further increased by 51.6% to RMB940.0 million as of December 31, 2023, resulting from an
increase in gold leasing.
Our financial liabilities at fair value through profit or loss increased by 9.2% from to
RMB940.0 million as of December 31, 2023 to RMB1,026.2 million as of September 30, 2024,
resulting from a decrease in gold leasing outstanding balance.
Most of our outstanding bank borrowings are denominated in RMB and U.S. dollars.
During the Track Record Period, certain of our outstanding bank loans were secured by the
pledge of fixed assets and mining rights.
Except for our indebtedness as disclosed above, we did not have outstanding indebtedness
or any loan capital issued and outstanding or agreed to be issued, bank overdrafts, loans or
similar indebtedness, liabilities under acceptance (other than normal trade bills), acceptance
credits, debentures, mortgages, charges, finance leases or hire purchase commitments,
guarantees or other material contingent liabilities as of September 30, 2024, being the latest
practicable date for our indebtedness statement.
FINANCIAL INFORMATION
– 554 –


--- page 566 ---
RELATED PARTY TRANSACTIONS
During the Track Record Period, we had transactions with certain related parties. For
details, please refer to Note 46 to the Accountants’ Report included in Appendix I to this
Prospectus. Our Directors confirm that these transactions were conducted on arm’s length basis
and entered into in the ordinary course of business and would not distort our track record
results or make our historical results not reflective of our future performance. The amounts due
to related parties and outstanding balances with related parties include lease fees and property
fees payable to Beijing Eagleleap and interest-bearing fund loans payable to the member of the
Single Largest Shareholder Group, Ms. Li Jinyang, which is to maintain our daily operation.
The non-trade outstanding balances with related parties, which was the loan of RMB1,074.2
million from the Single Largest Shareholder Group, was fully repaid in January 2024. Certain
related party transactions entered into by our Group during the Track Record Period are set out
below.
Loans received from the related parties (non-trade)
Y ear Ended December 31,
Nine Months
Ended/As of
September 30
2021 2022 2023 2024
(RMB’000)
Mr. Wang Jianhua /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118620,000 463,000 – –
Ms. Li Jinyang /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,074,240 – –
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118620,000 1,537,240 – –
New loans repaid to the related parties (non-trade)
Y ear Ended December 31,
Nine Months
Ended/As of
September 30
2021 2022 2023 2024
(RMB’000)
Mr. Wang Jianhua /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118620,000 463,000 – –
Ms. Li Jinyang /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 663,300 300,040 128,546
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118620,000 1,126,300 300,040 128,546
Outstanding balances with related parties:
Y ear Ended December 31,
Nine Months
Ended/As of
September 30
2021 2022 2023 2024
(RMB’000)
Other payables and accruals
Ms. Li Jinyang (non-trade) /H1118/H1118/H1118/H1118/H1118– 410,940 128,525 –
Beijing Eagleleap (trade) /H1118/H1118/H1118/H1118/H1118/H1118–4 12 2 2
– 410,981 128,547 2
Lease Liabilities
Beijing Eagleleap (trade) /H1118/H1118/H1118/H1118/H1118/H1118– 9,535 4,385 2,271
FINANCIAL INFORMATION
– 555 –


--- page 567 ---
KEY FINANCIAL RATIOS
The following table sets forth our key financial ratios for the periods indicated:
Y ear Ended December 31,
Nine Months
Ended/As of
September 30,
2021 2022 2023 2024
Rates of return
Return on assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187.6% 2.8% 4.7% 6.4%
Return on equity /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812.3% 6.7% 10.2% 12.9%
Liquidity ratios
Current ratio /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.8 1.3 1.3 1.4
Quick ratio /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.7 0.6 0.7 0.8
Gearing ratio /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.6% 35.1% 32.0% 24.2%
Notes:
1. Return on assets ratio is calculated using net profit divided by total assets at the end of the year,
multiplied by 100%.
2. Return on equity ratio is calculated using net profit divided by total equity at the end of the year,
multiplied by 100%.
3. Current ratio is calculated using total current assets divided by total current liabilities.
4. Quick ratio is calculated using total current assets less inventories divided by total current liabilities.
5. Gearing ratio is calculated by dividing total debt (which includes current and non-current bank loans,
lease liabilities and other borrowings) by total equity.
OFF-BALANCE SHEET ARRANGEMENTS
As of the Latest Practicable Date, we did not enter into any outstanding off-balance sheet
commitments or arrangements.
FINANCIAL RISK MANAGEMENT
We are exposed to a variety of financial risks, including market risk, credit risk and
liquidity risk. These risks and the manner in which we seek to mitigate them are summarized
below and described in more details in Note 49 to the Accountants’ Report included in
Appendix I to this Prospectus for more details. Thereto, please also see section headed “Risk
Factors”.
Market Risk
Interest rate risk
Our exposure to the risk of changes in market interest rates relates primarily to our debt
obligations with a floating interest rate.
FINANCIAL INFORMATION
– 556 –


--- page 568 ---
Exchange rate risk
We have transactional exchange rate risk exposures mainly arising from sales or
purchases by operating units in currencies other than the units’ functional currencies. We have
subsidiaries using U.S. dollars and Renminbi as their recording currency. These subsidiaries
have transactions in currencies other than their recording currency. In addition, we have
exchange rate exposures arising from foreign currency borrowings. We adopt an overall
management on their foreign exchange businesses and reduce their exchange rate exposures
using forward foreign exchange contracts based on the market trend as necessary.
Commodity price risk
We are mainly exposed to the risk of changes in major metals’ prices in the future,
including gold, copper, zinc, silver and copper cathodes. The fluctuations in these products’
prices may affect our operating performance.
We use commodity futures contracts to manage risk in the sale of gold, copper, zinc, silver
and copper cathodes. The management keeps an eye on the changes in prices of commodity
futures contracts.
Price risk of equity instrument investments
Price risk of equity instrument investments refers to the risk that the fair value of equity
securities is reduced due to changes in the level of the stock index and the value of individual
securities. As of September 30, 2024, we were exposed to the price risk of individual equity
instrument investments due to the classification as equity instrument investments at fair value
through profit or loss.
Credit Risk
We only deal with approved and reputable third parties. According to our policy, all
customers who require credit transactions are subject to a credit review. In addition, we
continuously monitor the balance of trade receivable to ensure that the Group is not exposed
to significant bad debt risks.
Since counterparties of cash and cash equivalents and derivatives are banks with good
reputation and high credit ratings, credit risk arising from these financial instruments is
insignificant.
Other financial assets of our Company include equity instrument investments, trade
receivable and some derivatives. The credit risk on these financial assets arises from the default
of counterparties, with a maximum exposure equal to carrying amounts of these instruments.
Our maximum exposure to credit risk at each balance sheet date is the total amount
charged to the customers less the amount of the provision for impairment.
FINANCIAL INFORMATION
– 557 –


--- page 569 ---
Liquidity Risk
We use a revolving liquidity planning tool to manage the risk of funding shortfalls. This
tool considers both the maturity of its financial instruments and the expected cash flows
generated from our operations.
Our objective is to maintain a balance between continuity and flexibility of funding
through the use of financing including long-term loans and short-term loans.
Financial Risk
We implement a combination of short-term financing through gold leasing contracts and
we engage in hedging transactions in the futures market to transfer and mitigate price risks.
Also, fluctuations in the market prices of gold and other Mineral Resources, which have
historically exhibited considerable volatility, impact our profitability and cash follow from
operations. Due to the international pricing of gold in U.S. dollars, and the fact that our
operating costs of overseas mining and expenditures are denominated in various currencies, we
are exposed to risks associated with exchange rate fluctuations.
UNAUDITED PRO FORMA STATEMENT OF ADJUSTED CONSOLIDATED NET
TANGIBLE ASSETS
For details of our unaudited pro forma adjusted consolidated net tangible assets, see
Appendix IIA to this Prospectus.
FINANCIAL INFORMATION
– 558 –


--- page 570 ---
Cash Operating and Production Costs
Cash operating costs for our PRC Gold Mines primarily consist of labor cost, material cost, electricity cost and some other costs. The table
below is based on the SRK Report and sets forth a summary of historical and forecast of the cash operating costs and cash operating costs per gram
of gold produced of our PRC Gold Mines for the years indicated.
The anticipated fluctuations in future cash operating costs are primarily driven by several factors, which vary across the gold mines. For some
mines, the expansion of mining capacity is expected to increase gold production, thereby reducing unit costs. In others, higher gold grades in the
deeper zones contribute to greater gold output and further reductions in unit costs. Specifically, the production schedule of each of Wulong Gold
Mine and Jilong Gold Mine in the SRK Report solely focuses on stope production and excludes ore from comprehensive utilization as recorded in
historical data. As a result, it is anticipated that gold production of these two mines will be lower compared to previous figures, thus leading to an
increase in unit costs.
Wulong Gold Mine Unit 2021 2022 2023 2024Q1-Q3 LOM 1 2024Q4 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035
Gold Produced /H1118/H1118/H1118/H1118/H1118/H1118kg 791 1,222 1,824 1,477 6,538 2 153 678 785 687 668 717 741 668 535 465 303 139
Labor /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 101.31 77.62 76.70 73.14 100.89 3 120.61 97.55 84.66 95.50 99.54 100.62 98.06 102.46 126.27 95.11 97.10 159.12
Material /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 24.02 46.03 46.62 33.25 49.95 3 59.72 48.30 41.92 47.28 49.28 49.82 48.55 50.73 62.51 47.09 48.07 78.78
Electricity /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 35.54 34.25 21.05 22.44 15.06 3 18.00 14.56 12.64 14.26 14.86 15.02 14.64 15.29 18.85 14.20 14.49 23.75
Contractors /H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 9.11 – – – 2.84 3 3.39 2.75 2.38 2.69 2.80 2.83 2.76 2.88 3.55 2.68 2.73 4.48
Engineering /H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 10.54 – – 1.19 3.28 3 3.93 3.18 2.76 3.11 3.24 3.28 3.19 3.34 4.11 3.10 3.16 5.18
Service /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 1.21 6.69 4.47 16.43 7.11 3 8.50 6.88 5.97 6.73 7.02 7.09 6.91 7.22 8.90 6.71 6.85 11.22
Safety /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g – – – – – 3 ––––––––––––
Repairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 3.91 1.80 1.20 2.17 1.22 3 1.46 1.18 1.02 1.15 1.20 1.22 1.19 1.24 1.53 1.15 1.17 1.92
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g – – – – – 3 ––––––––––––
Taxes and surcharges /H1118/H1118RMB/g 16.04 16.83 17.37 20.47 8.86 3 10.59 8.57 7.44 8.39 8.74 8.84 8.61 9.00 11.09 8.35 8.53 13.98
Selling costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g – – – – – 3 ––––––––––––
G&A costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 27.17 36.18 15.48 9.55 15.91 3 19.02 15.38 13.35 15.06 15.70 15.87 15.46 16.16 19.91 15.00 15.31 25.09
R&D costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 14.05 13.26 14.70 17.79 7.70 3 9.21 7.45 6.46 7.29 7.60 7.68 7.48 7.82 9.64 7.26 7.41 12.14
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 242.90 232.66 197.59 196.42 212.83 4 254.44 205.79 178.60 201.46 209.99 212.25 206.86 216.14 266.36 200.63 204.83 335.66
Notes:
1. LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year since September 30, 2024, until all Ore Reserves are extracted in the final
year. The forecasted production volume is estimated based on the designed mining capacity, scheduling strategy and expansion timelines. For detail s, please refer to the mine
schedule set forth in “Business — Development Plan and Planned Production Schedule — Planned Production Schedule”.
2. “Gold Produced” is the total gold production over the LOM, as the aggregated volume of all the annual production volume.
FINANCIAL INFORMATION
– 559 –


--- page 571 ---
3. Each of the cost in this column is the average cost over the LOM, which is calculated as the total cost over the LOM divided by the total gold production.
4. “Total” is derived by applying the adjusted historical per-ton cost to the forecasted ore ton each year and then summing over the LOM.
Jilong Gold Mine Unit 2021 2022 2023 2024Q1-Q3 LOM 1 2024Q4 2025 2026 2027 2028 2029 2030 2031 2032
Gold Produced /H1118/H1118/H1118/H1118/H1118kg 1,048 811 1,390 795 7,782 2 754 1,327 1,142 1,444 973 687 695 549 211
Labor /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 56.20 77.88 43.98 81.16 73.23 3 72.02 85.87 97.80 83.38 69.61 52.78 48.84 42.36 39.66
Material /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 18.31 30.18 17.44 34.06 27.27 3 26.82 31.97 36.42 31.05 25.92 19.65 18.19 15.77 14.77
Electricity /H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 10.54 13.25 7.74 16.90 9.44 3 9.28 11.07 12.61 10.75 8.97 6.80 6.30 5.46 5.11
Contractors /H1118/H1118/H1118/H1118/H1118/H1118RMB/g – – – – – 3 –––––––––
Engineering /H1118/H1118/H1118/H1118/H1118/H1118RMB/g 4.25 5.17 2.63 2.39 3.66 3 3.60 4.30 4.89 4.17 3.48 2.64 2.44 2.12 1.98
Service /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 1.80 2.49 0.47 0.11 1.56 3 1.53 1.83 2.08 1.78 1.48 1.12 1.04 0.90 0.84
Safety /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 3.78 4.93 2.20 8.69 4.86 3 4.78 5.69 6.49 5.53 4.62 3.50 3.24 2.81 2.63
Repairment /H1118/H1118/H1118/H1118/H1118/H1118RMB/g 1.36 2.06 1.21 0.31 1.30 3 1.28 1.53 1.74 1.49 1.24 0.94 0.87 0.75 0.71
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 0.49 0.65 0.15 0.12 0.42 3 0.42 0.50 0.57 0.48 0.40 0.31 0.28 0.25 0.23
Taxes and surcharges /H1118RMB/g 16.19 19.69 45.53 23.90 22.05 3 21.69 25.86 29.45 25.11 20.96 15.89 14.71 12.75 11.94
Selling costs /H1118/H1118/H1118/H1118/H1118/H1118RMB/g 0.08 0.12 0.08 0.00 0.09 3 0.09 0.11 0.12 0.10 0.09 0.06 0.06 0.05 0.05
G&A costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 28.82 37.55 31.02 36.43 33.37 3 32.82 39.13 44.57 37.99 31.72 24.05 22.26 19.30 18.07
R&D costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 9.72 10.34 14.63 20.58 15.74 3 15.47 18.45 21.02 17.92 14.96 11.34 10.49 9.10 8.52
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g 151.53 204.32 167.07 224.65 193.00 4 189.80 226.30 257.75 219.74 183.46 139.10 128.72 111.63 104.52
Notes:
1. LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year since September 30, 2024, until all Ore Reserves are extracted in the final
year. The forecasted production volume is estimated based on the designed mining capacity, scheduling strategy and expansion timelines. For detail s, please refer to the mine
schedule set forth in “Business — Development Plan and Planned Production Schedule — Planned Production Schedule”.
2. “Gold Produced” is the total gold production over the LOM, as the aggregated volume of all the annual production volume.
3. Each of the cost of this column is the average cost over the LOM, which is calculated as the total cost over the LOM divided by the total gold production.
4. “Total” is derived by applying the adjusted historical per-ton cost to the forecasted ore ton each year and then summing over the LOM.
FINANCIAL INFORMATION
– 560 –


--- page 572 ---
Huatai Gold Mine Unit 2021 2022 2023 2024Q1-Q3 LOM 1 2024Q4 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049 2050 2051 2052 2053
Gold Produced /H1118/H1118/H1118kg 133 48 4 – 9,796 2 – – 317 295 264 298 316 312 277 300 288 314 306 291 334 389 361 342 419 334 497 576 518 519 427 446 401 237 239 180
Labor /H1118/H1118/H1118/H1118/H1118/H1118RMB/g 211.65 98.39 899.07 – 99.59 3 – – 109.55 118.66 132.97 117.52 110.98 112.38 126.66 116.77 121.86 111.62 114.68 120.61 105.05 90.12 97.47 102.64 83.69 104.98 70.72 60.90 67.65 67.58 82.24 78.63 87.44 148.11 146.99 160.29
Material /H1118/H1118/H1118/H1118/H1118RMB/g 20.40 33.07 11.20 – 9.46 3 – – 10.40 11.27 12.63 11.16 10.54 10.67 12.03 11.09 11.57 10.60 10.89 11.45 9.97 8.56 9.25 9.75 7.95 9.97 6.72 5.78 6.42 6.42 7.81 7.47 8.30 14.06 13.96 15. 22
Electricity /H1118/H1118/H1118/H1118RMB/g 32.73 40.72 71.34 – 12.84 3 – – 14.12 15.29 17.14 15.15 14.30 14.48 16.32 15.05 15.70 14.38 14.78 15.54 13.54 11.61 12.56 13.23 10.79 13.53 9.11 7.85 8.72 8.71 10.60 10.13 11.27 19.0 9 18.94 20.66
Contractors /H1118/H1118/H1118/H1118RMB/g – – – – – 3 ––––––––––––––––––––––––––––––
Engineering /H1118/H1118/H1118/H1118RMB/g 75.26 214.92 407.21 – 29.51 3 – – 32.46 35.16 39.40 34.83 32.89 33.30 37.53 34.60 36.11 33.08 33.98 35.74 31.13 26.71 28.88 30.42 24.80 31.11 20.96 18.05 20.05 20.03 24.37 23.30 25.91 43.89 43.56 47.50
Service /H1118/H1118/H1118/H1118/H1118RMB/g 6.89 9.77 6.30 – 4.24 3 – – 4.66 5.05 5.66 5.00 4.72 4.78 5.39 4.97 5.19 4.75 4.88 5.13 4.47 3.84 4.15 4.37 3.56 4.47 3.01 2.59 2.88 2.88 3.50 3.35 3.72 6.30 6.26 6.82
Safety /H1118/H1118/H1118/H1118/H1118/H1118RMB/g 10.09 6.27 7.40 – 3.96 3 – – 4.35 4.71 5.28 4.67 4.41 4.46 5.03 4.64 4.84 4.43 4.55 4.79 4.17 3.58 3.87 4.08 3.32 4.17 2.81 2.42 2.69 2.68 3.27 3.12 3.47 5.88 5.84 6.37
Repairment /H1118/H1118/H1118/H1118RMB/g 2.91 2.64 0.27 – 1.15 3 – – 1.26 1.37 1.53 1.35 1.28 1.30 1.46 1.35 1.40 1.29 1.32 1.39 1.21 1.04 1.12 1.18 0.96 1.21 0.82 0.70 0.78 0.78 0.95 0.91 1.01 1.71 1.69 1.85
Others /H1118/H1118/H1118/H1118/H1118RMB/g 0.08 0.08 3.29 – 0.06 3 – – 0.06 0.07 0.08 0.07 0.07 0.07 0.07 0.07 0.07 0.07 0.07 0.07 0.06 0.05 0.06 0.06 0.05 0.06 0.04 0.04 0.04 0.04 0.05 0.05 0.05 0.09 0.09 0.09
Taxes and surcharges /H1118RMB/g 33.32 60.38 688.86 – 13.07 3 – – 14.37 15.57 17.45 15.42 14.56 14.74 16.62 15.32 15.99 14.64 15.05 15.82 13.78 11.82 12.79 13.47 10.98 13.77 9.28 7.99 8.88 8.87 10.79 10.32 11.47 19.4 3 19.28 21.03
Selling costs /H1118/H1118/H1118/H1118RMB/g – – – – – 3 ––––––––––––––––––––––––––––––
G&A costs /H1118/H1118/H1118/H1118RMB/g 108.61 573.59 4,555.80 – 51.11 3 – – 56.22 60.89 68.23 60.31 56.95 57.67 65.00 59.92 62.53 57.28 58.85 61.89 53.90 46.24 50.01 52.67 42.95 53.87 36.29 31.25 34.72 34.68 42.20 40.35 44.87 76.00 75.43 82.25
R&D costs /H1118/H1118/H1118/H1118RMB/g – – – – – 3 ––––––––––––––––––––––––––––––
Total /H1118/H1118/H1118/H1118/H1118/H1118RMB/g 501.94 1,039.83 6,650.73 – 224.97 4 – – 247.47 268.05 300.37 265.47 250.69 253.86 286.12 263.77 275.26 252.13 259.06 272.45 237.29 203.57 220.16 231.85 189.06 237.13 159.75 137.57 152.8 2 152.66 185.78 177.61 197.51 334.57 332.03 362.07
Notes:
1. LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year since September 30, 2024, until all Ore Reserves are extracted in the final
year. The forecasted production volume is estimated based on the designed mining capacity, scheduling strategy and expansion timelines. For detail s, please refer to the mine
schedule set forth in “Business — Development Plan and Planned Production Schedule — Planned Production Schedule”.
2. “Gold Produced” is the total gold production over the LOM, as the aggregated volume of all the annual production volume.
3. Each of the cost in this column is the average cost over the LOM, which is calculated as the total cost over the LOM divided by the total gold production.
4. “Total” is derived by applying the adjusted historical per-ton cost to the forecasted ore ton each year and then summing over the LOM.
FINANCIAL INFORMATION
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Jintai Gold Mine Unit 2021 2022 2023 2024Q1-Q3 LOM 1 2024Q4 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034
Gold Produced /H1118/H1118/H1118/H1118kg – – 75 204 796 2 17 62 68 110 65 61 83 54 66 140 69
Labor /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g – – 23.81 35.67 265.25 3 6.47 27.14 27.07 27.17 27.10 26.52 26.61 25.62 26.18 27.10 18.26
Material /H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g – – 25.00 71.87 278.53 3 6.80 28.50 28.42 28.53 28.46 27.85 27.94 26.91 27.50 28.46 19.17
Electricity /H1118/H1118/H1118/H1118/H1118/H1118RMB/g – – 0.93 8.05 27.27 3 0.67 2.79 2.78 2.79 2.79 2.73 2.74 2.63 2.69 2.79 1.88
Contractors /H1118/H1118/H1118/H1118/H1118RMB/g – – 13.93 14.43 155.20 3 3.79 15.88 15.84 15.90 15.86 15.52 15.57 14.99 15.32 15.86 10.68
Engineering /H1118/H1118/H1118/H1118/H1118RMB/g – – 14.40 55.57 188.34 3 4.60 19.27 19.22 19.29 19.24 18.83 18.90 18.19 18.59 19.24 12.96
Service /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g – – 20.09 85.78 290.72 3 7.09 29.75 29.66 29.78 29.70 29.07 29.17 28.09 28.70 29.70 20.01
Safety /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g – – 8.25 22.13 91.95 3 2.24 9.41 9.38 9.42 9.39 9.19 9.23 8.88 9.08 9.40 6.33
Repairment /H1118/H1118/H1118/H1118/H1118RMB/g – – – – – 3 –––––––––––
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g – – – – – 3 –––––––––––
Taxes and
surcharges /H1118/H1118/H1118/H1118/H1118
RMB/g – – 16.47 0.44 183.48 3 4.48 18.77 18.72 18.80 18.75 18.35 18.41 17.72 18.11 18.75 12.63
Selling costs /H1118/H1118/H1118/H1118/H1118RMB/g – – 0.59 1.46 6.59 3 0.16 0.67 0.67 0.67 0.67 0.66 0.66 0.64 0.65 0.67 0.45
G&A costs /H1118/H1118/H1118/H1118/H1118/H1118RMB/g – – 59.71 85.80 665.28 3 16.23 68.07 67.88 68.16 67.97 66.52 66.74 64.27 65.67 67.97 45.79
R&D costs /H1118/H1118/H1118/H1118/H1118/H1118RMB/g – – – – – 3 –––––––––––
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/g – – 183.17 381.18 2,152.62 4 52.52 220.25 219.65 220.53 219.93 215.24 215.96 207.95 212.50 219.94 148.15
Notes:
1. LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year since September 30, 2024, until all Ore Reserves are extracted in the final
year. The forecasted production volume is estimated based on the designed mining capacity, scheduling strategy and expansion timelines. For detail s, please refer to the mine
schedule set forth in “Business — Development Plan and Planned Production Schedule — Planned Production Schedule”.
2. “Gold Produced” is the total gold production over the LOM, as the aggregated volume of all the annual production volume.
3. Each of the cost in this column is the average cost over the LOM, which is calculated as the total cost over the LOM divided by the total gold production.
4. “Total” is derived by applying the adjusted historical per-ton cost to the forecasted ore ton each year and then summing over the LOM.
Cash operating costs for our Hanfeng Polymetallic Mine primarily consist of labor cost, material cost, electricity cost and some other costs.
The table below is based on the SRK Report and sets forth a summary of historical and forecast of the cash operating costs and cash operating costs
per tonnes of comprehensive metal produced of our Hanfeng Polymetallic Mine for the years indicated.
FINANCIAL INFORMATION
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At the Hanfeng Polymetallic Mine, historical costs have been calculated based on operations conducted in the upper zone of the mine. In
contrast, the design presented in the SRK Report focuses on the lower zone. This difference in the production zones is expected to result in variations
in metal output, which, in turn, is anticipated to lead to discrepancies in unit cash costs.
Hanfeng Polymetallic Mine 1 Unit 2021 2022 2023 2024Q1-Q3 LOM 2 2024Q4 2025 2026 2027 2028 2029 2030 2031 2032
Comprehensive Metal
Produced /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118t 12 13 8 7 152 3 –1 91 81 91 42 42 51 81 5
Labor /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/t 2,144 2,899 3,321 11,179 1,391 4 – 1,468 1,513 1,465 1,600 1,216 1,123 1,418 1,529
Material /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/t 1,440 1,795 1,548 2,544 587 4 – 620 639 618 676 514 474 598 645
Electricity /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/t 1,192 1,518 1,785 1,824 505 4 – 533 549 532 581 442 408 515 555
Contractors /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/t – – – 3,087 179 4 – 189 194 188 206 156 144 182 196
Engineering /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/t 1,174 1,091 1,223 2 316 4 – 333 344 333 363 276 255 322 347
Service /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/t 80 63 34 86 22 4 –2 32 42 32 61 91 82 32 4
Safety /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/t 181 127 175 477 71 4 –7 57 77 58 26 25 77 27 8
Repairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/t 49 31 38 26 12 4 –1 31 31 31 41 11 01 31 4
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/t 104 72 86 82 29 4 –3 03 13 03 32 52 32 93 2
Taxes and surcharges /H1118/H1118/H1118/H1118/H1118/H1118RMB/t 643 776 493 1,708 280 4 – 295 304 295 322 245 226 285 308
Selling costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/t 10 12 15 – 3 4 –34343334
G&A costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/t 1,279 986 1,957 1,859 469 4 – 495 510 494 540 410 379 478 516
R&D costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/t – – – – – 4 –––––––––
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/t 8,296 9,370 10,674 22,875 3,864 5 – 4,079 4,203 4,071 4,446 3,380 3,120 3,939 4,247
Notes:
1. Hanfeng Mining operates two mines: the Lishan Mine and the Dongfeng Mine. Only the Lower Part (Stage 1) of the Lishan Mine was considered in Ore Reserv es estimation.
Currently, this Lower Part is under construction and has no production. The data of the Upper Part of the Lishan Mine and the Dongfeng Mine is referenced for the economic
analysis of the Lower Part of the Lishan Mine. Comprehensive Metal includes Copper, Lead and Zinc.
2. LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year since September 30, 2024, until all Ore Reserves are extracted in the final
year. The forecasted production volume is estimated based on the designed mining capacity, scheduling strategy and expansion timelines. For detail s, please refer to the mine
schedule set forth in “Business — Development Plan and Planned Production Schedule — Planned Production Schedule”.
3. “Comprehensive Metal Produced” is the total comprehensive metal production over the LOM, as the aggregated volume of all the annual production vol ume.
4. Each of the cost in this column is the average cost over the LOM, which is calculated as the total cost over the LOM divided by the total comprehensive me tal production.
5. “Total” is derived by applying the adjusted historical per-ton cost to the forecasted ore ton each year and then summing over the LOM.
FINANCIAL INFORMATION
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Cash operating costs for our Sepon Gold and Copper Mine primarily consist of labor cost, material cost, electricity cost and some other costs.
The table below is based on the SRK Report and sets forth a summary of historical and forecast of the cash operating costs and cash operating costs
per tonnes of gold and copper produced of our Sepon Gold and Copper Mine for the years indicated.
At the Sepon Gold and Copper Mine, future cost differences are anticipated to primarily arise from a shift in mining methods. In contrast to
historical operations, which have combined both open-pit and underground mining, future production is expected to rely solely on underground
mining. This transition is anticipated to lead to significant changes in operating costs.
Sepon Gold and
Copper Mine 1 Unit 2021 2022 2023 2024Q1-Q3 LOM 2 2024Q4 2025 2026 2027 2028 2029 2030
Gold Produced /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118kg 5,982.85 6,629.29 6,009.04 3,948.67 15,962.97 3 1,568.18 5,151.72 4,912.44 1,803.41 1,353.15 1,108.47 65.61
Copper Produced /H1118/H1118/H1118/H1118/H1118/H1118/H1118kt 4.31 6.88 6.17 3.67 4.97 4 1.83 3.1 4–––––
Gold Operation
Labor /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g 4.75 3.42 3.84 4.62 4.45
5 8.23 4.90 3.50 3.84 3.63 3.26 4.31
Material /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g 18.02 26.94 23.32 22.63 25.23 5 46.66 27.75 19.82 21.76 20.59 18.47 24.45
Electricity /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g 2.23 1.84 3.06 3.75 3.46 5 6.40 3.81 2.72 2.99 2.83 2.54 3.36
Contractors /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g 0.01 0.01 0.00 0.00 0.01 5 0.02 0.01 0.01 0.01 0.01 0.01 0.01
Engineering /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g 0.00 0.00 0.00 0.00 0.00 5 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Service /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g 0.00 0.00 0.00 0.00 0.00 5 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Safety /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g – – – – – 5 –––––––
Repairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g – – – – – 5 –––––––
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g 0.00 0.00 0.00 0.00 0.00 5 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Copper Operation
Labor /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g 496.89 417.28 651.56 794.16 2,145.95
5 2,197.48 2,115.9 2–––––
Material /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g 1,720.05 3,226.50 3,895.73 3,868.71 7,153.18 5 7,324.95 7,053.0 7–––––
Electricity /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g 236.50 206.87 545.01 625.98 953.76 5 976.66 940.4 1–––––
Contractors /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g 0.71 0.48 0.52 0.56 2.85 5 2.92 2.8 1–––––
Engineering /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g 0.08 0.06 0.06 0.07 0.31 5 0.32 0.3 0–––––
Service /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g 0.02 0.03 0.06 0.06 0.08 5 0.08 0.0 8–––––
Safety /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g – – – – – 5 –––––––
FINANCIAL INFORMATION
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Sepon Gold and
Copper Mine 1 Unit 2021 2022 2023 2024Q1-Q3 LOM 2 2024Q4 2025 2026 2027 2028 2029 2030
Repairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g – – – – – 5 –––––––
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g 0.04 0.04 0.06 0.15 0.15 5 0.15 0.1 5–––––
Taxes and surcharges /H1118/H1118/H1118/H1118/H1118USD/g 2.88 3.01 3.60 4.23 3.41 5 7.20 4.12 2.33 2.56 2.42 2.17 2.88
Selling costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g 0.01 0.01 0.01 0.01 0.01 5 0.02 0.01 0.01 0.01 0.01 0.01 0.01
G&A costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g 2.82 0.68 3.07 3.31 2.84 5 6.00 3.44 1.94 2.13 2.02 1.81 2.40
R&D costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g – – – – ––––––––
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g 30.72 35.91 36.91 38.54 39.42 6 74.54 44.04 30.33 33.30 31.51 28.27 37.42
Notes:
1. All costs at the company level of LXML are borne by the gold mine of the Sepon Gold and Copper Mine.
2. LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year since September 30, 2024, until all Ore Reserves are extracted in the final
year. The forecasted production volume is estimated based on the designed mining capacity, scheduling strategy and expansion timelines. For detail s, please refer to the mine
schedule set forth in “Business — Development Plan and Planned Production Schedule — Planned Production Schedule”.
3. “Gold Produced” is the total gold production over the LOM, as the aggregated volume of all the annual production volume.
4. “Copper Produced” is the total copper production over the LOM, as the aggregated volume of all the annual production volume.
5. Each of the cost in this column is the average cost over the LOM, which is calculated as the total cost over the LOM divided by the total gold and copper pr oduction.
6. “Total” is derived by applying the adjusted historical per-ton cost to the forecasted ore ton each year and then summing over the LOM.
FINANCIAL INFORMATION
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Cash operating costs for our Wassa Gold Mine primarily consist of labor cost, material cost, electricity cost and some other costs. The table
below is based on the SRK Report and sets forth a summary of historical and forecast of the cash operating costs and cash operating costs per gram
of gold produced of our Wassa Gold Mine for the years indicated.
At the Wassa Gold Mine, anticipated future cost differences are expected to primarily result from a transition in mining methods. Specifically,
whereas historical operations have integrated both open-pit and underground mining, future production is projected to be conducted exclusively
through underground mining. This shift is expected to give rise to significant changes in operating costs.
Wassa Gold Mine Unit 2021 2022 2023 2024Q1-Q3 LOM 1 2024Q4 2025 2026 2027 2028
Gold Produced /H1118/H1118/H1118/H1118/H1118kg – 4,835 5,310 5,022 17,955 2 1,981 6,000 5,533 3,474 967
Labor /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g – 7 7 6 10 3 10 11 10 10 11
Material /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g – 12 11 14 19 3 19 20 17 18 19
Electricity /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g – 2 4 2 4 3 44444
Contractors /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g – 0 2 1 2 3 22222
Engineering /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g – 1 2 1 2 3 22222
Service /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g – 0 0 1 1 3 11111
Safety /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g – – – – – 3 –––––
Repairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g – – – – – 3 –––––
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g – 1 – 0 1 3 11111
Taxes and
surcharges /H1118/H1118/H1118/H1118/H1118/H1118/H1118
USD/g – 3 4 4 4 3 44334
Selling costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g – – – – – 3 –––––
G&A costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g – 4 4 3 5 3 55445
R&D costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g – – – – – 3 –––––
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118USD/g – 30 34 30 46 4 46 50 42 43 47
Notes:
1. LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year since September 30, 2024, until all Ore Reserves are extracted in the final
year. The forecasted production volume is estimated based on the designed mining capacity, scheduling strategy and expansion timelines. For detail s, please refer to the mine
schedule set forth in “Business — Development Plan and Planned Production Schedule — Planned Production Schedule”.
2. “Gold Produced” is the total gold production over the LOM, as the aggregated volume of all the annual production volume.
3. Each of the cost in this column is the average cost over the LOM, which is calculated as the total cost over the LOM divided by the total gold production.
4. “Total” is derived by applying the adjusted historical per-ton cost to the forecasted ore ton each year and then summing over the LOM.
FINANCIAL INFORMATION
– 566 –


--- page 578 ---
Cash operating costs for our Mengkham Rare Earth Element Project primarily consist of workforce employment costs, consumable costs, fuel,
electricity, water and other services and non-income taxes, royalties and governmental charges. The table below is based on the SRK Report and
sets forth a summary of forecast of the cash operating costs and cash operating costs per tonnes of run of mine (“RoM”) and rare earth oxides
(“REO”) produced of our Mengkham Rare Earth Element Project for the years indicated.
Mengkham Rare Earth
Element Project Unit 2021 2022 2023 2024Q1-Q3 LOM 2024Q4 2025 2026 2027 2028 2029 2030 2031
Workforce employment /H1118/H1118/H1118/H1118/H1118RMB/t RoM – – – – 1.09 1.13 1.06 1.15 1.06 1.06 0.83 1.09 1.70
RMB/t REO – – – – 5,929.88 6,593.74 5,157.11 6,344.00 5,805.71 6,294.58 4,903.81 5,351.23 8,987.67
Consumables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/t RoM – – – – 14.64 14.65 15.71 13.86 15.35 13.90 13.88 15.04 14.99
RMB/t REO – – – – 79,448.33 85,812.35 76,724.73 76,277.13 83,933.69 82,660.65 81,885.70 74,119.00 79,472.29
Fuel, electricity, water and
other services /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
RMB/t RoM – – – – 1.11 1.03 1.24 1.10 1.11 1.02 1.02 1.23 1.14
RMB/t REO – – – – 6,041.95 6,035.80 6,042.25 6,042.05 6,042.96 6,043.40 6,042.53 6,040.72 6,040.75
On and off-site administration /H1118RMB/t RoM – – – – 0.21 0.22 0.21 0.23 0.21 0.21 0.16 0.21 0.33
RMB/t REO – – – – 1,166.02 1,296.56 1,014.07 1,247.45 1,141.60 1,237.73 964.26 1,052.24 1,767.29
Environmental protection and
monitoring /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
RMB/t RoM – – – – 0.22 0.21 0.25 0.22 0.22 0.20 0.20 0.24 0.23
RMB/t REO – – – – 1,200.13 1,204.62 1,200.02 1,198.65 1,200.22 1,201.42 1,200.02 1,198.88 1,201.24
Transportation of workforce /H1118/H1118RMB/t RoM – – – – 0.04 0.04 0.04 0.04 0.04 0.04 0.03 0.04 0.06
RMB/t REO – – – – 215.53 239.66 187.44 230.58 211.02 228.78 178.23 194.50 326.67
Product marketing and
transport /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
RMB/t RoM – – – – 0.28 0.26 0.31 0.27 0.27 0.25 0.25 0.30 0.28
RMB/t REO – – – – 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00
Non-income taxes, royalties
and governmental charges /H1118/H1118
RMB/t RoM – – – – 11.69 10.84 12.99 11.53 11.61 10.67 10.76 12.88 11.97
RMB/t REO – – – – 63,451.33 63,451.33 63,451.33 63,451.33 63,451.33 63,451.33 63,451.33 63,451.33 63,451.33
Contingency allowances /H1118/H1118/H1118/H1118RMB/t RoM – – – – 1.61 1.53 1.74 1.61 1.59 1.49 1.43 1.74 1.83
RMB/t REO – – – – 8,743.44 8,952.88 8,499.64 8,874.09 8,704.27 8,858.50 8,419.73 8,560.89 9,708.13
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB/t RoM – – – – 30.90 29.90 33.54 30.01 31.46 28.83 28.58 32.77 32.53
RMB/t REO – – – – 167,697 175,087 163,777 165,165 171,991 171,476 168,546 161,469 172,455
Note: LOM is calculated by deducting the forecasted production volume from the Ore Reserves each year since September 30, 2024, until all Ore Reserves are ex tracted in the final
year. The forecasted production volume is estimated based on the designed mining capacity, scheduling strategy and expansion timelines. For detail s, please refer to the mine
schedule set forth in “Business — Development Plan and Planned Production Schedule — Planned Production Schedule”.
FINANCIAL INFORMATION
– 567 –


--- page 579 ---
DIVIDEND
We declared and dividends to our Shareholders of nil, nil, RMB82.4 million and nil
respectively, for the years ended December 31, 2021, 2022 and 2023 and the nine months ended
September 30, 2024.
According to a Board resolution dated March 29, 2024 and a Shareholder resolution dated
April 19, 2024, with a total share capital of 1,663,911,378 shares at the end of 2023, after
deducting the 15,182,600 shares held in our dedicated securities account for repurchases, the
base for profit distribution was 1,648,728,778 shares. A cash dividend of RMB0.50 per 10
shares (including tax) was paid to all shareholders, totalling RMB82,436,438.90.
Subject to our constitutional documents and the Company Law, we have adopted a general
annual dividend policy, according to which we may declare dividend by way of cash dividends,
stock dividends, or a combination of cash and stock dividends. We prioritize cash dividends.
Other than under certain special circumstances, the accumulated profit distributed in cash in
any three consecutive years shall not be less than 30% of the annual distributable profit
realized in the same three years. The abovementioned special circumstances include: (i) our
Company’s net cash flow from operating activities in the year of the consolidated statement of
accounts is negative; (ii) the single amount of investment projects such as proposed internal
investment, external investment or assets acquisition in the current year or within the next
twelve months reaches or exceeds 10% of our Company’s latest audited net assets.
There is no guarantee, representation or indication that our Directors must or will
recommend and that we must or will declare and pay dividends at all. The dividend distribution
record in the past may not be used as a reference or basis to determine the level of dividends
that may be declared or paid by us in the future.
LISTING EXPENSES
Listing expenses represent professional fees, underwriting commissions and other fees
incurred in connection with the Global Offering. We expect to incur listing expenses of
approximately HK$189.2 million, representing approximately 4.4% of the gross proceeds from
the Global Offering (based on the mid-point of the indicative Offer Price range and assuming
the Over-allotment Option is not exercised). The listing expenses we incurred in the Track
Record Period and expect to incur would consist of approximately HK$128.4 million
underwriting-related fees and approximately HK$60.8 million non-underwriting-related fees
(including fees and expenses of legal advisors and the reporting accountant of approximately
HK$28.5 million and other fees and expenses of approximately HK$32.3 million). Among the
total listing expenses which we expect to incur, approximately HK$172.1 million will be
directly attributable to the issue of our Shares and deducted from equity, and the remaining
HK$17.1 million will be expensed upon Listing. Our Directors do not expect such expenses to
materially impact our results of operations in 2024.
FINANCIAL INFORMATION
– 568 –


--- page 580 ---
NO MATERIAL ADVERSE CHANGE
After due and careful consideration, our Directors confirm that, up to the date of this
document, there has been no material adverse change in our financial and trading position or
prospects since September 30, 2024.
PROFIT ESTIMATE FOR THE YEAR ENDED DECEMBER 31, 2024
On the basis set out in Appendix IIB to this prospectus, and in the absence of unforeseen
circumstances, we estimate our consolidated profit attributable to owners of our Company for
the year ended December 31, 2024 to be not less than RMB1,730.0 million (equivalent to
approximately HK$1,879.4 million). For details about our consolidated profit attributable to
owners of our Company for the year ended December 31, 2024, see “Appendix IIB — Profit
Estimate.”
DISCLOSURE REQUIRED UNDER THE HONG KONG LISTING RULES
We confirm that, as at the Latest Practicable Date, there were no circumstances that would
give rise to a disclosure requirement under Rules 13.13 to 13.19 of the Hong Kong Listing
Rules.
FINANCIAL INFORMATION OF GOLDEN STAR RESOURCES
This following is a discussion of Golden Star Resources’ results of operation for (i) the
period from January 1, 2021 to January 31 2021, (ii) the year ended December 31, 2021, and
(iii) the period from January 1, 2022 to January 31, 2022, the acquisition date.
Consolidated Income Statements
The table below sets forth the consolidated statements of profit or loss of Golden Star
Resources from January 1, 2021 to January 31, 2022 (acquisition date) derived from the
consolidated statements of profit or loss of Golden Star Resources set out in the Accountants’
Report included in Appendix IB to this Prospectus:
Y ear ended
December 31,
One month
Ended
January 31,
One month
Ended
January 31,
2021 2021 2022
(RMB’000)
(unaudited)
Revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,671,379 120,733 111,476
Cost of sales /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(877,076) (65,921) (71,197)
FINANCIAL INFORMATION
– 569 –


--- page 581 ---
Y ear ended
December 31,
One month
Ended
January 31,
One month
Ended
January 31,
2021 2021 2022
(RMB’000)
(unaudited)
Gross profit /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118794,303 54,812 40,279
Other income and gains /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111822,312 9,519 95
Administrative expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(629,067) (19,282) (430,078)
Other expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(4,412) (829) (15,353)
Finance costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(64,419) (7,954) (5,520)
Profit/(loss) before tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118118,717 36,266 (410,577)
Income tax expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(224,257) (18,475) 57,154
(Loss)/Profit for the year/period /H1118/H1118/H1118/H1118/H1118/H1118(105,540) 17,791 (353,423)
Total comprehensive income for the
year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(184,369) (58,305) (344,400)
Discussion of Certain Key Income Statements Items
Revenue
Revenue of Golden Star Resources was approximately RMB1,671.4 million, RMB120.7
million and RMB111.5 million for the year ended December 31, 2021, one month ended
January 31, 2021 and one month ended January 31, 2022.
Revenue primarily consists of revenue from contracts with customers. The following
table sets forth the components of Golden Star Resources for the period indicated.
Y ear ended
December 31,
One month
Ended
January 31,
One month
Ended
January 31,
2021 2021 2022
(RMB’000)
(unaudited)
Revenue from contracts with customers /H1118 1,671,379 120,733 111,476
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,671,379 120,733 111,476
FINANCIAL INFORMATION
– 570 –


--- page 582 ---
Cost of Sales
Cost of sales of Golden Star Resources consist of (i) direct operating cost including
salaries, fuel, electricity and consumables as well as (ii) overheads associated with the mining
and processing of gold. Cost of sales of Golden Star Resources was approximately RMB877.1
million, RMB65.9 million and RMB71.2 million for the years ended December 31, 2021, one
month ended January 31, 2021 and one month ended January 31, 2022.
Gross profit
Gross profit represents revenue less cost of sales. Gross profit of Golden Star Resources
was approximately RMB794.3 million, RMB54.8 million and RMB40.3 million for the year
ended December 31, 2021, one month ended January 31, 2021 and one month ended January
31, 2022.
Other income and gains
Other income and gains primarily consist of gains on changes in fair value of derivative
financial instruments, interest income and others. The following table sets forth the
components of other income and gains for the period indicated.
Other income and gains of Golden Star Resources was approximately RMB22.3 million,
RMB9.5 million and RMB0.1 million for the year ended December 31, 2021, one month ended
January 31, 2021 and one month ended January 31, 2022.
Y ear ended
December 31,
One month
Ended
January 31,
One month
Ended
January 31,
2021 2021 2022
(RMB’000)
(unaudited)
Gains on changes in fair value of
derivative financial instruments /H1118/H1118/H1118/H1118/H1118/H111820,946 9,239 –
Interest income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,090 175 62
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118276 105 33
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111822,312 9,519 95
Administrative expenses
Administrative expenses primarily consist of corporate office salaries, severance and
other related cost due to the acquisition of Golden Star Resources in January 2022, consultancy
costs, management fees and corporate overheads. Administrative expenses of Golden Star
Resources was approximately RMB629.1 million, RMB19.3 million and RMB430.1 million for
the year ended December 31, 2021, one month ended January 31, 2021 and one month ended
January 31, 2022.
FINANCIAL INFORMATION
– 571 –


--- page 583 ---
Other expenses
Other expenses primarily consist of loss on disposal of non-current assets and bank fees.
The following table sets forth the components of other expenses and losses for the period
indicated. Other expenses of Golden Star Resources was approximately RMB4.4 million,
RMB0.8 million and RMB15.4 million for the year ended December 31, 2021, one month
ended January 31, 2021 and one month ended January 31, 2022.
Y ear ended
December 31,
One month
Ended
January 31,
One month
Ended
January 31,
2021 2021 2022
(RMB’000)
(unaudited)
Foreign exchange losses, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,777 819 1,534
Other /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118635 10 13,819
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,412 829 15,353
Finance costs
Finance costs primarily represent the interest expense. The following table sets forth the
components of finance costs for the period indicated.
Finance costs of Golden Star Resources was approximately RMB64.4 million, RMB8.0
million and RMB5.5 million for the year ended December 31, 2021, one month ended January
31, 2021 and one month ended January 31, 2022.
An analysis of finance costs is as follows:
Y ear ended
December 31,
One month
Ended
January 31,
One month
Ended
January 31,
2021 2021 2022
(RMB’000)
(unaudited)
Interest on loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111836,784 5,663 3,255
Interest on metal streaming
arrangement /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111816,662 1,412 1,313
Accretion of interest of provisions /H1118/H1118/H1118/H1118/H1118509 27 125
Interest on lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,464 852 827
64,419 7,954 5,520
FINANCIAL INFORMATION
– 572 –


--- page 584 ---
Income tax expenses
Income tax expenses primarily consist of: (i) current tax expenses; and (ii) deferred tax
expense. The following table sets forth the components of income tax expenses for the period
indicated.
Income tax expenses of Golden Star Resources was approximately RMB224.3 million,
RMB18.5 million and RMB57.2 million for the years ended December 31, 2021, one month
ended January 31, 2021 and one month ended January 31, 2022.
Y ear ended
December 31,
One month
Ended
January 31,
One month
Ended
January 31,
2021 2021 2022
(RMB’000)
(unaudited)
Current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118185,597 14,753 6,910
Deferred /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111838,660 3,722 (64,064)
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118224,257 18,475 (57,154)
PERIOD TO PERIOD COMPARISON OF RESULTS OF OPERATIONS
One Months Ended January 31, 2022 Compared to One Months Ended January 31, 2021
Revenue
Revenue decreased by 7.7% from RMB120.7 million for the one month ended January 31,
2021 to RMB111.5 million for the one month ended January 31, 2022, primarily due to the
decrease of 4% in average gold price recorded in January 2022.
Cost of Sales
Cost of sales increased by 8.0% from RMB65.9 million for the one month ended January
31, 2021 to RMB71.2 million for the one month ended January 31, 2022, primarily due to the
increase in staff cost and change in inventory.
Gross Profit and Gross Profit Margin
Gross profit decreased by 26.5% from RMB54.8 million for the one month ended January
31, 2021 to RMB40.3 million for the one month ended January 31, 2022 due to the higher staff
cost incurred in 2022.
FINANCIAL INFORMATION
– 573 –


--- page 585 ---
Other income and gains
Other income and gains decreased significantly by 99.0% from RMB9.5 million for the
one month ended January 31, 2021 to RMB0.1 million for the one month ended January 31,
2022, primarily due to the unrealized gain on gold hedge and the gain on fair value of
derivative financial instruments of RMB9.2 million in 2021, while the gold hedge agreements
was terminated in January 2022.
Administrative expenses
Administrative expenses increased significantly by 2,130.5% from RMB19.3 million for
the one month ended January 31, 2021 to RMB430.1 million for the one month ended January
31, 2022, primarily due to severance and acquisition of control cost due to the acquisition of
Golden Star Resources in January 2022.
Other expenses
Other expenses increased significantly by 1,752.0% from RMB0.8 million for the one
month ended January 31, 2021 to RMB15.4 million for the one month ended January 31, 2022.
The other expenses for the one month ended January 31, 2022 mainly represented exchange
loss and the bank charge for the period.
Finance costs
Finance costs decreased by 30.6% from RMB8.0 million for the one month ended January
31, 2021 to RMB5.5 million for the one month ended January 31, 2022, primarily due to the
settlement of a convertible debenture and a loan from a financial institution in August 2021 and
January 2022, respectively. These settlements were partially offset by receiving a revolving
loan from Chijin HK in January 2022.
Profit/(loss) before tax
Profit before tax decreased significantly by 1,232.1% from RMB36.3 million for the one
month ended January 31, 2021 to loss before tax approximately RMB410.6 million for the one
month ended January 31, 2022, primarily due to the severance and acquisition of control cost
due to the acquisition of GSR in January 2022.
Income tax expenses
Golden Star Resources recorded income tax expenses of RMB18.5 million for the one
month ended January 31, 2021 and we record income tax credit of RMB57.2 million for the one
month ended January 31, 2022, primarily due to the increase of deferred tax assets related to
the tax losses recognized during the acquisition of Golden Star Resources.
FINANCIAL INFORMATION
– 574 –


--- page 586 ---
Profit for the year/period
Golden Star Resources recorded profit for the year/period of RMB17.8 million for the one
month ended January 31, 2021 and Golden Star Resources recorded loss for the one month
ended January 31, 2022 of RMB353.4 million, primarily due to severance and acquisition of
control cost arising from the acquisition of Golden Star Resources in January 2022.
Discussion of Certain Key Financial Position Items
The following table sets forth Golden Star Resources’ consolidated statements of
financial position as of the dates indicated:
As of
December 31,
As of
January 31,
2021 2022
RMB’000 RMB’000
Non-current assets
Property, plant and equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,441,764 1,456,297
Right-of-use assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118193,934 192,027
Other intangible assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111828,781 28,553
Other non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814,762 14,759
Deferred tax assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 66,828
Total non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,679,241 1,758,464
Current assets
Inventories /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118190,444 195,531
Trade receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,589 6,500
Prepayments, other receivables and other assets /H1118 87,696 92,390
Financial assets at fair value through profit or
loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118158 158
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118224,335 70,007
Total current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118504,222 364,586
Total assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,183,463 2,123,050
Current liabilities
Trade and notes payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118146,316 172,763
Contract liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111850,619 50,610
Other payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118117,991 903,498
Income tax payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,585 10,587
Current portion of long-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,798 –
Current portion of lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820,361 20,291
Current portion of derivative financial
liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118188 –
Current portion of provisions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,797 6,796
Total current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118352,655 1,164,545
Net Current Assets/(Liabilities) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118151,567 (799,959)
FINANCIAL INFORMATION
– 575 –


--- page 587 ---
As of
December 31,
As of
January 31,
2021 2022
RMB’000 RMB’000
Total Assets less Current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,830,808 958,505
Non-current liabilities
Long-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118529,656 –
Derivative financial liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811,153 –
Contract liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118591,866 590,143
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118188,832 186,845
Deferred tax liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118236,487 239,044
Provisions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118102,348 102,004
Total non-current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,660,342 1,118,036
Net Assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118170,466 (159,531)
Equity
Equity attributable to owners of the parent
Share capital /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,906,459 6,906,459
Reserves /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(6,901,831) (7,251,897)
Non-controlling interests /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118165,838 185,907
Total equity /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118170,466 (159,531)
Property, plant and equipment
Property, plant and equipment consist of comprised buildings, machinery, mobile
equipment, electronic equipment and others, mineral assets and construction in progress. As of
January 31, 2022, Golden Star Resources recorded property, plant and equipment of
RMB1,456.3 million.
Right-of-use assets
Right-of-use assets represent buildings and machinery and vehicles. As of January 31,
2022, Golden Star Resources recorded right-of-use assets of RMB192.0 million.
Other intangible assets
Other intangible assets represent exploration and mining rights and others. As of January
31, 2022, Golden Star Resources recorded intangible assets of RMB28.6 million.
Other non-current assets
Golden Star Resources’ other non-current assets represent funds for land restoration and
environmental rehabilitation after mine closure. As of January 31, 2022, Golden Star Resources
recorded other non-current assets of RMB14.8 million.
FINANCIAL INFORMATION
– 576 –


--- page 588 ---
Inventories
Golden Star Resources’ inventories primarily consist of raw materials, work in progress
and finished goods. As of January 31, 2022, Golden Star Resources recorded inventories of
RMB195.5 million. The following table sets forth a breakdown of Golden Star Resources’
inventories as of the dates indicated:
As of
December 31,
As of
January 31,
2021 2022
(RMB’000)
Raw materials /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118156,456 161,057
Work in progress /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819,832 34,436
Finished goods /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814,156 38
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118190,444 195,531
Trade receivables
The trade receivables for Golden Star Resources represented trade receivables and
impairment were RMB1.6 million and RMB6.5 million as of December 31, 2021 and January
31, 2022.
Prepayments, other receivables, and other assets
Golden Star Resources’ prepayments, other receivables, and other assets consist of
prepayments and deposits and other receivables. As of January 31, 2022, Golden Star
Resources recorded inventories of RMB92.4 million. The following table sets forth a
breakdown of our prepayments, other receivables and other assets as of the dates indicated:
As of
December 31,
As of
January 31,
2021 2022
(RMB’000)
Prepayments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111846,852 54,712
Deposits and other receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111840,844 37,678
Less: Impairment of other receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111887,696 92,390
Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss refer to listed equity investment. As
of January 31, 2022, Golden Star Resources recorded financial assets at fair value through
profit or loss of RMB0.2 million.
FINANCIAL INFORMATION
– 577 –


--- page 589 ---
Cash and cash equivalents
Golden Star Resources’ cash and cash equivalents consist of cash and bank balances and
cash and cash equivalents. As of January 31, 2022, Golden Star Resources recorded cash and
cash equivalents of RMB70.0 million.
Trade and notes payables
Golden Star Resources’ trade and notes payables consist of trade payables. As of January
31, 2022, Golden Star Resources recorded trade and notes payables of RMB172.8 million.
The following table sets forth a breakdown of Golden Star Resources’ trade and notes
payables as of the dates indicated:
As of
December 31,
As of
January 31,
2021 2022
(RMB’000)
Trade payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118146,316 172,763
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118146,316 172,763
All of Golden Star Resources’ trade and notes payables are aged less than one year. The
following table sets forth an aging analysis of our trade and notes payables as of the dates
indicated:
As of
December 31,
As of
January 31,
2021 2022
(RMB’000)
Less than 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118146,316 172,763
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118146,316 172,763
FINANCIAL INFORMATION
– 578 –


--- page 590 ---
Contract liabilities
As of January 31, 2022, Golden Star Resources recorded contract liabilities of RMB640.8
million. The following table sets forth a breakdown of Golden Star Resources’ contract
liabilities as of the dates indicated:
As of
December 31,
As of
January 31,
2021 2022
(RMB’000)
Short-term advances received from customers
Metal Streaming Arrangement /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111850,619 50,610
Long-term advances received from customers
Metal Streaming Arrangement /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118591,866 590,143
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118642,485 640,753
Other payables and accruals
Golden Star Resources’ other payables and accruals consist of retention payables to
contractors, salaries, wages and benefits payables, taxes other than income tax payables and
others.
As of
December 31,
As of
January 31,
2021 2022
(RMB’000)
Payable to Chijin /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 598,185
Payables to contractors /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111876,940 65,864
Salaries, wages and benefits payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111831,230 229,603
Taxes other than income tax payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,552 9,698
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118269 148
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118117,991 903,498
We recorded payable to Chijin of RMB598.2 million which represents the GSWL’s
outstanding balance due to Chijin HK as of January 31, 2022. This balance is unsecured,
interest-free and has no fixed terms of repayment.
Income tax payables
As of January 31, 2022, Golden Star Resources recorded income tax payables of
RMB10.6 million.
FINANCIAL INFORMATION
– 579 –


--- page 591 ---
Long-term loans
As of January 31, 2022, Golden Star Resources recorded nil long-term loans.
Lease liabilities
As of January 31, 2022, Golden Star Resources recorded lease liabilities of RMB186.8
million.
Derivative financial liabilities
As of January 31, 2022, Golden Star Resources recorded nil derivative financial
liabilities.
Provisions
As of January 31, 2022, Golden Star Resources recorded provisions of RMB102.0
million.
Discussion of Certain Key Cash Flows Items
The following table sets forth a summary of Golden Star Resources’ statements of cash
flow for the period indicated.
Y ear ended
December 31,
One month
ended
January 31,
One month
ended
January 31,
2021 2021 2022
(RMB’000)
(unaudited)
Net cash flows from/(used in) operating
activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118295,894 (108,796) (111,641)
Net cash flows used in investing
activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(399,994) (18,686) (64,614)
Net cash flows from/(used in) financing
activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(120,978) (2,435) 22,345
Net increase/(decrease) in cash and
equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(165,078) (130,099) (153,910)
Cash and cash equivalents at the end of
the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118224,335 263,511 70,007
FINANCIAL INFORMATION
– 580 –


--- page 592 ---
Net cash flows from/(used in) operating activities
Net cash flows from operating activities from January 1, 2021 to January 31, 2022 was
RMB184.3 million reflecting net cash inflows generated from sales of gold during the period.
Net cash flows used in investing activities
Net cash flows used in investing activities from January 1, 2021 to January 31, 2022 was
RMB464.6 million reflecting exploration and acquisition of mining equipment during the
period. This is primary attributable to increased underground/surface mine development and
acquisition of additional property, plant and equipment.
Net cash flows from/(used in) financing activities
Net cash flows used in financing activities from January 1, 2021 to January 31, 2022 was
RMB98.6 million. This is primarily due to the settlement of a convertible debenture and a loan
from a financial institution in August 2021 and January 2022, respectively. These settlements
were partially offset by receiving a revolving loan from Chijin HK in January 2022.
FINANCIAL INFORMATION
– 581 –


--- page 593 ---
THE CORNERSTONE PLACING
We have entered into cornerstone investment agreements (each a “ Cornerstone
Investment Agreement ”, and together the “ Cornerstone Investment Agreements ”) with the
cornerstone investors set out below (each a “ Cornerstone Investor ”, and together the
“Cornerstone Investors ”), pursuant to which the Cornerstone Investors have agreed to,
subject to certain conditions, subscribe, or cause their designated entities to subscribe, at the
Offer Price for such number of Offer Shares (rounded down to the nearest whole board lot of
200 H Shares) that may be purchased for an aggregate amount of HK$744.87 million,
calculated based on an exchange rate of RMB0.9221 : HK$1.0000 and USD1.0000 :
HK$7.7770) and exclusive of brokerage fee, the SFC transaction levy, the AFRC transaction
levy and the Hong Kong Stock Exchange trading fee) (the “ Cornerstone Placing ”).
Based on the Offer Price of HK$15.83 per Offer Share, being the high-end of the
indicative Offer Price range set out in this Prospectus, the total number of Offer Shares to be
subscribed for by the Cornerstone Investors would be 47,054,200. The table below reflects the
shareholding percentage immediately after the completion of the Global Offering:
Assuming the Offer Size Adjustment
Option is not exercised
Assuming the Offer Size Adjustment
Option is exercised in full
Assuming the
Over-allotment Option
is not exercised
Assuming the
Over-allotment Option
is exercised in full
Assuming the
Over-allotment Option
is not exercised
Assuming the
Over-allotment Option
is exercised in full
Approx. %
of the Offer
Shares
Approx. %
of the total
issued
capital
of our
Company
immediately
upon the
Global
Offering
Approx. %
of the Offer
Shares
Approx. %
of the total
issued
capital
of our
Company
immediately
upon the
Global
Offering
Approx. %
of the Offer
Shares
Approx. %
of the total
issued
capital
of our
Company
immediately
upon the
Global
Offering
Approx. %
of the Offer
Shares
Approx. %
of the total
issued
capital
of our
Company
immediately
upon the
Global
Offering
22.88% 2.52% 19.90% 2.48% 19.90% 2.48% 17.30% 2.43%
CORNERSTONE INVESTMENT
– 582 –


--- page 594 ---
Based on the Offer Price of HK$14.78 per Offer Share, being the mid-point of the
indicative Offer Price range set out in this Prospectus, the total number of Offer Shares to be
subscribed for by the Cornerstone Investors would be 50,397,000. The table below reflects the
shareholding percentage immediately after the completion of the Global Offering:
Assuming the Offer Size Adjustment
Option is not exercised
Assuming the Offer Size Adjustment
Option is exercised in full
Assuming the
Over-allotment Option
is not exercised
Assuming the
Over-allotment Option
is exercised in full
Assuming the
Over-allotment Option
is not exercised
Assuming the
Over-allotment Option
is exercised in full
Approx. %
of the Offer
Shares
Approx. %
of the total
issued
capital
of our
Company
immediately
upon the
Global
Offering
Approx. %
of the Offer
Shares
Approx. %
of the total
issued
capital
of our
Company
immediately
upon the
Global
Offering
Approx. %
of the Offer
Shares
Approx. %
of the total
issued
capital
of our
Company
immediately
upon the
Global
Offering
Approx. %
of the Offer
Shares
Approx. %
of the total
issued
capital
of our
Company
immediately
upon the
Global
Offering
24.51% 2.70% 21.32% 2.65% 21.32% 2.65% 18.54% 2.60%
Based on the Offer Price of HK$13.72 per Offer Share, being the low-end of the
indicative Offer Price range set out in this prospectus, the total number of Offer Shares to be
subscribed for by the Cornerstone Investors would be 54,290,800. The table below reflects the
shareholding percentage immediately after the completion of the Global Offering:
Assuming the Offer Size Adjustment
Option is not exercised
Assuming the Offer Size Adjustment
Option is exercised in full
Assuming the
Over-allotment Option
is not exercised
Assuming the
Over-allotment Option
is exercised in full
Assuming the
Over-allotment Option
is not exercised
Assuming the
Over-allotment Option
is exercised in full
Approx. %
of the Offer
Shares
Approx. %
of the total
issued
capital
of our
Company
immediately
upon the
Global
Offering
Approx. %
of the Offer
Shares
Approx. %
of the total
issued
capital
of our
Company
immediately
upon the
Global
Offering
Approx. %
of the Offer
Shares
Approx. %
of the total
issued
capital
of our
Company
immediately
upon the
Global
Offering
Approx. %
of the Offer
Shares
Approx. %
of the total
issued
capital
of our
Company
immediately
upon the
Global
Offering
26.40% 2.90% 22.96% 2.86% 22.96% 2.86% 19.96% 2.80%
CORNERSTONE INVESTMENT
– 583 –


--- page 595 ---
We believe that the Cornerstone Placing signifies our Cornerstone Investors’ confidence
in our Company and its business prospect, and that the Cornerstone Placing will help to raise
the profile of our Company. Our Company became acquainted with each of the Cornerstone
Investors in its ordinary course of operation through the Group’s business network, or through
introduction by the Company’s business partners or the Joint Global Coordinators of the Global
Offering.
The Cornerstone Placing will form part of the International Offering, and save as
otherwise obtained consent from the Hong Kong Stock Exchange, the Cornerstone Investors
and their respective close associates will not subscribe for any Offer Shares under the Global
Offering (other than pursuant to the Cornerstone Investment Agreements). The Offer Shares to
be subscribed by the Cornerstone Investors will rank pari passu in all respects with the fully
paid H Shares in issue following the Global Offering of the Company and will be counted
towards the public float of our Company under Rule 8.08 of the Listing Rules. Immediately
following the completion of the Global Offering, the Cornerstone Investors or their close
associates will not, by virtue of their cornerstone investments, have any Board representation
in our Company; and none of the Cornerstone Investors and their close associates will become
a substantial Shareholder of our Company. Other than a guaranteed allocation of the relevant
Offer Shares at the final Offer Price, the Cornerstone Investors do not have any preferential
rights under each of their respective Cornerstone Investment Agreements, as compared with
other public Shareholders. There are no side arrangements or agreements between our
Company and the Cornerstone Investors or any benefit, direct or indirect, conferred on the
Cornerstone Investors by virtue of or in relation to the Listing, other than a guaranteed
allocation of the relevant Offer Shares at the final Offer Price, following the principles as set
out in Chapter 4.15 of the Guide.
To the best knowledge of our Company, each of the Cornerstone Investors is (i) not
accustomed to take instructions from our Company or any of our Directors, Supervisors, chief
executive, the Single Largest Shareholder Group, substantial Shareholders or existing
Shareholders or any of its subsidiaries or their respective close associates in relation to the
acquisition, disposal, voting or other disposition of the Shares registered in their name or
otherwise held by them; (ii) not financed by our Company or any of our Directors, Supervisors,
chief executive of our Company, the Single Largest Shareholder Group, substantial
Shareholders, existing Shareholders or any of its subsidiaries or their respective close
associates; and (iii) save that Zijin Mining Group Co., Ltd. (“ Zijin Mining ”), the holding
company of Gold Mountains (H.K.) International Mining Company Limited (“ Gold
Mountains ”), held approximately 19% equity interest in Zhaojin Mining Industry Company
Limited (“ Zhaojin Mining ”), the holding company of Sparky International Company Limited
(“Sparky ”) as of the Latest Practicable Date, independent of the other Cornerstone Investors,
our Group, our connected persons and their respective associates, and is not an existing
Shareholder or a close associate of our Group. In addition, to the best knowledge of our
Company, (i) each of the Cornerstone Investors is independent from each other and makes
independent investment decisions; and (ii) no specific approval from any stock exchange (if
relevant) or its shareholders is required for the investment by each Cornerstone Investor in our
Company as described in this section. Furthermore, we confirm that (i) none of the Cornerstone
Investors has the right to nominate any Director nor has any representative on our Board; and
(ii) none of the Cornerstone Investors is expected to be involved in the management of the
business of our Company.
CORNERSTONE INVESTMENT
– 584 –


--- page 596 ---
Although Zijin Mining Group Co., Ltd. (“ Zijin Mining ”) holds approximately 19% of the
equity interest in Zhaojin Mining Industry Co., Ltd. (“ Zhaojin Mining ”), the Cornerstone
Investors are independent from each other taking into account the following reasons:
(i) Distinct Ownership Structures
Shandong Zhaojin Group Company Limited (ʮ̡) is the largest
shareholder of Zhaojin Mining, holding approximately 35.63% of the equity interest in Zhaojin
Mining. Meanwhile, the largest shareholder of Zijin Mining is Minxi Xinghang State-owned
Assets Investment Co. Ltd. (ʮ̡) holding 22.89% of its
equity interest. Accordingly, there is no overlap in terms of the control of the two companies.
(ii) Operational and Managerial Independence
Based on the public disclosure of Zijin Mining, a company listed on the Hong Kong Stock
Exchange (stock code: 2899) and the Shanghai Stock Exchange (stock code: 601899), and
Zhaojin Mining, a company listed on the Hong Kong Stock Exchange (stock code: 1818), to
the best of the Company’s knowledge, there is nothing to indicate that the two listed
companies, or Gold Mountains vis-à-vis Sparky, are not independent of each other in terms of
their operations and management.
(iii) Separate Negotiations for Cornerstone Investments
The cornerstone investment agreements with Gold Mountains and Sparky were negotiated
and concluded independently. Specifically:
 Independent Decision-Making : The negotiations of the Cornerstone Investment
Agreement with each of the Cornerstone Investors were conducted separately with
their respective management members, and to the best knowledge of the Company
having made reasonable enquiries, each of the Cornerstone Investors had undergone
their respective internal approval procedures to approve the transaction under the
respective Cornerstone Investment Agreement; and
 Self-Funded Commitments : To the best knowledge of the Company having made
reasonable enquiries, the subscription obligations under the respective Cornerstone
Investment Agreement is to be fulfilled using each investor’s internal financial
resources, with no shared funding arrangements.
Accordingly, despite the shareholding relationship as mentioned above, the Company
considers that the Cornerstone Investors are independent of each other.
CORNERSTONE INVESTMENT
– 585 –


--- page 597 ---
To the best knowledge of our Company and as confirmed by each of the Cornerstone
Investors, each of the Cornerstone Investors make independent investment decisions. The
subscription under the Cornerstone Placing by each of the Cornerstone Investors would be
financed by its own internal financial resources and it has sufficient funds to settle its
investment under the Cornerstone Placing. Each of the Cornerstone Investors has confirmed
that all necessary approvals have been obtained with respect to the Cornerstone Placing.
The Cornerstone Investors have agreed to pay for the relevant Offer Shares that they have
subscribed before dealings in the Company’s H Shares commence on the Hong Kong Stock
Exchange. Each of the Cornerstone Investors has agreed that our Company and the Overall
Coordinators or the Joint Global Coordinators (as the case maybe) in their sole discretion may
defer the delivery of all or part of the Offer Shares it will subscribe to a date later than the
Listing Date. Where delayed delivery takes place, such Cornerstone Investor that may be
affected by such delayed delivery has agreed that it shall nevertheless fully pay for the relevant
Offer Shares before the Listing. Such delayed delivery arrangement is in place to facilitate the
over-allocation in the International Offering. If there is over-allocation in the International
Offering, the settlement of such over-allocation may be effected through delayed delivery of
the Offer Shares to be subscribed by all Cornerstone Investors under the Cornerstone Placing.
There will be no delayed delivery if there is no over-allocation in the International Offering.
The delayed delivery arrangements relate only to the delay in the delivery of the Offer Shares
to such Cornerstone Investor on the condition that the Offer Price for the Offer Shares allocated
to such Cornerstone Investor will be fully paid before the Listing, and thus there will be no
delayed settlement of payment no matter whether there is delayed delivery or not. For details
of the Over-allotment Option and the stabilization action by the Stabilizing Manager, please
refer to the paragraphs headed “— Over-allotment Option” and “— Stabilization” in the section
headed “Structure of the Global Offering” in this Prospectus, respectively.
To the best knowledge of the Company and the Joint Global Coordinators, and based on
the indicative interest of investment of the Cornerstone Investors and/or their close associates
as of the date of this Prospectus, certain Cornerstone Investors and/or their close associates
may participate in the International Offering as placees and subscribe for further Offer Shares
in the Global Offering. The Company will seek the Hong Kong Stock Exchange’s consent
and/or waiver to allow the Cornerstone Investors and/or their close associates to participate in
the International Offering as placees pursuant to Chapter 4.15 of the Guide. Whether such
Cornerstone Investors and/or the Single Largest Shareholder Group close associates will place
orders in the International Offering are uncertain and will be subject to the final investment
decisions of such investors and the terms and conditions of the Global Offering.
The total number of Offer Shares to be subscribed by the Cornerstone Investors may be
affected by reallocation of the Offer Shares between the International Offering and the Hong
Kong Public Offering. If the total demand for H shares in the Hong Kong Public Offering falls
within the circumstance as set out in the section headed “Structure of the Global Offering —
The Hong Kong Public Offering — Reallocation” in this Prospectus. Details of the actual
number of Offer Shares to be allocated to the Cornerstone Investors will be disclosed in the
allotment results announcement of our Company to be published on or around Friday, March
7, 2025.
CORNERSTONE INVESTMENT
– 586 –


--- page 598 ---
THE CORNERSTONE INVESTORS
The table below sets forth details of the Cornerstone Placing:
Assuming an Offer Price of HK$15.83 per H Share (being the high-end of the Offer Price range)
Assuming the Offer Size Adjustment
Option is not exercised
Assuming the Offer Size Adjustment
Option is exercised in full
Assuming the
Over-allotment Option
is not exercised
Assuming the
Over-allotment Option is
exercised in full
Assuming the
Over-allotment Option
is not exercised
Assuming the
Over-allotment Option
is exercised in full
Cornerstone Investor
Subscription
Amount
Subscription
Amount
Number of
Offer
Shares (2)
Approx.
% of the
Offer
Shares
Approximate
% of the
issued share
capital
Approx. %
of the Offer
Shares
Approximate
% of the
issued share
capital
Approx.
% of the
Offer
Shares
Approximate
% of the
issued share
capital
Approx.
% of the
Offer
Shares
Approximate
% of the
issued share
capital
(in million)
HK$ (in
million) (1)
Gold Mountains (H.K.)
International Mining
Company Limited /H1118/H1118US$40.00 311.08 19,651,200 9.56% 1.05% 8.31% 1.03% 8.31% 1.03% 7.23% 1.02%
Sparky International
Company Limited /H1118/H1118RMB400.00 433.79 27,403,000 13.32% 1.47% 11.59% 1.44% 11.59% 1.44% 10.08% 1.42%
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 744.87 47,054,200 22.88% 2.52% 19.90% 2.48% 19.90% 2.48% 17.30% 2.43%
Assuming an Offer Price of HK$14.78 per H Share (being the mid-point of the Offer Price range)
Assuming the Offer Size Adjustment
Option is not exercised
Assuming the Offer Size Adjustment
Option is exercised in full
Assuming the
Over-allotment Option
is not exercised
Assuming the
Over-allotment Option is
exercised in full
Assuming the
Over-allotment Option
is not exercised
Assuming the
Over-allotment Option
is exercised in full
Cornerstone Investor
Subscription
Amount
Subscription
Amount
Number of
Offer
Shares (2)
Approx.
% of the
Offer
Shares
Approximate
% of the
issued share
capital
Approx. %
of the Offer
Shares
Approximate
% of the
issued share
capital
Approx.
% of the
Offer
Shares
Approximate
% of the
issued share
capital
Approx.
% of the
Offer
Shares
Approximate
% of the
issued share
capital
(in million)
HK$ (in
million) (1)
Gold Mountains (H.K.)
International Mining
Company Limited /H1118/H1118US$40.00 311.08 21,054,400 10.24% 1.13% 8.90% 1.11% 8.90% 1.11% 7.74% 1.09%
Sparky International
Company Limited /H1118/H1118RMB400.00 433.79 29,359,800 14.28% 1.57% 12.41% 1.54% 12.41% 1.54% 10.80% 1.52%
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 744.87 50,397,000 24.51% 2.70% 21.32% 2.65% 21.32% 2.65% 18.54% 2.60%
CORNERSTONE INVESTMENT
– 587 –


--- page 599 ---
Assuming an Offer Price of HK$13.72 per H Share (being the low-end of the Offer Price range)
Assuming the Offer Size Adjustment
Option is not exercised
Assuming the Offer Size Adjustment
Option is exercised in full
Assuming the
Over-allotment Option
is not exercised
Assuming the
Over-allotment Option is
exercised in full
Assuming the
Over-allotment Option
is not exercised
Assuming the
Over-allotment Option
is exercised in full
Cornerstone Investor
Subscription
Amount
Subscription
Amount
Number of
Offer
Shares (2)
Approx.
% of the
Offer
Shares
Approximate
% of the
issued share
capital
Approx. %
of the Offer
Shares
Approximate
% of the
issued share
capital
Approx.
% of the
Offer
Shares
Approximate
% of the
issued share
capital
Approx.
% of the
Offer
Shares
Approximate
% of the
issued share
capital
(in million)
HK$ (in
million) (1)
Gold Mountains (H.K.)
International Mining
Company Limited /H1118/H1118US$40.00 311.08 22,673,400 11.03% 1.21% 9.59% 1.19% 9.59% 1.19% 8.34% 1.17%
Sparky International
Company Limited /H1118/H1118RMB400.00 433.79 31,617,400 15.37% 1.69% 13.37% 1.66% 13.37% 1.66% 11.63% 1.63%
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 744.87 54,290,800 26.40% 2.90% 22.96% 2.86% 22.96% 2.86% 19.96% 2.80%
Notes:
(1) Calculated based on the exchange rate set out in the section headed “Information about this Prospectus and the
Global Offering — Exchange Rate Conversion” in this Prospectus.
(2) Subject to rounding down to the nearest whole board lot of 200 Offer Shares.
The information about our Cornerstone Investors set forth below has been provided by the
Cornerstone Investors in connection with the Cornerstone Placing.
Gold Mountains (H.K.) International Mining Company Limited
Gold Mountains (H.K.) International Mining Company Limited (“ Gold Mountains ”) was
incorporated in Hong Kong in 2004. Gold Mountains is a wholly-owned subsidiary of Zijin
Mining, a joint stock company listed on the Hong Kong Stock Exchange (stock code: 2899) and
the Shanghai Stock Exchange (stock code: 601899). Zijin Mining is a sizeable multinational
mining group dedicated to exploration and development of copper, gold, zinc, lithium, silver,
molybdenum and other metallic mineral resources globally, research, design and application of
mining engineering, etc.
CORNERSTONE INVESTMENT
– 588 –


--- page 600 ---
Sparky International Company Limited
Sparky International Company Limited (“ Sparky ”) is a company incorporated in Hong
Kong and is ultimately controlled by Zhaojin Mining Industry Company Limited, a company
listed on the Hong Kong Stock exchange (stock code: 1818) (“ Zhaojin Mining ”). Zhaojin
Mining is a joint stock limited company incorporated in the PRC and is primarily engaged in
the exploration, mining, ore processing, smelting and sale of gold products and other metallic
products.
CLOSING CONDITIONS
The obligation of each Cornerstone Investor to subscribe for the Offer Shares under the
respective Cornerstone Investment Agreement is subject to, among other things, the following
closing conditions:
(i) the underwriting agreements for the Hong Kong Public Offering and the
International Offering being entered into and having become effective and
unconditional (in accordance with their respective original terms or as subsequently
waived or varied by agreement of the parties thereto) by no later than the time and
date as specified in these underwriting agreements, and neither of the aforesaid
underwriting agreements having been terminated;
(ii) the Offer Price having been agreed upon between the Company and the Overall
Coordinators (for themselves and on behalf of the underwriters of the Global
Offering);
(iii) the Listing Committee of the Hong Kong Stock Exchange having granted the
approval for the listing of, and permission to deal in, the H Shares (including the H
Shares subscribed for by the Cornerstone Investors as well as other applicable
waivers and approvals) and such approval, permission or waiver having not been
revoked prior to the commencement of dealings in the H Shares on the Hong Kong
Stock Exchange;
(iv) the CSRC having accepted the CSRC filings and published the filing results in
respect of the CSRC filings on its website, and such notice of acceptance and/or
filing results published not having otherwise been rejected, withdrawn, revoked or
invalidated prior to the commencement of dealings in the H Shares on the Hong
Kong Stock Exchange;
(v) no laws shall have been enacted or promulgated by any governmental authority
which prohibits the consummation of the transactions contemplated in the Global
Offering or herein and there shall be no orders or injunctions from a court of
competent jurisdiction in effect precluding or prohibiting consummation of such
transactions; and
CORNERSTONE INVESTMENT
– 589 –


--- page 601 ---
(vi) the respective agreements, representations, warranties, undertakings,
acknowledgements and confirmations of the relevant Cornerstone Investor under the
respective Cornerstone Investment Agreement are accurate, true and complete in all
respects and not misleading or deceptive and that there is no breach of this
Agreement on the part of the Cornerstone Investor.
RESTRICTIONS ON THE CORNERSTONE INVESTORS
Each Cornerstone Investor has agreed that it will not, and will cause its affiliates not to,
whether directly or indirectly, at any time during the period of six months from (and inclusive
of) the Listing Date (the “ Lock-up Period ”), dispose of, in any way, any of the Offer Shares
or any interest in any company or entity holding such Offer Shares that they have purchased
pursuant to the relevant Cornerstone Investment Agreement (the “ Lock-up Undertaking ”),
save for certain limited circumstances, such as, (i) in respect of Gold Mountains, transfers to
any of its wholly-owned subsidiaries which will be bound by the same obligations of such
Cornerstone Investor, including the Lock-up Period restriction; and (ii) in respect of Sparky,
transfers to any of its wholly-owned subsidiaries, and/or Zhaojin Mining, and/or subsidiaries
of Zhaojin Mining which will be bound by the same obligations of such Cornerstone Investor,
including the Lock-up Period restriction.
CORNERSTONE INVESTMENT
– 590 –


--- page 602 ---
FUTURE PLANS
See “Business — Business Strategies” in this Prospectus for a detailed description of our
future plans.
USE OF PROCEEDS
Assuming that the Over-allotment Option is not exercised, after deducting the
underwriting commissions and other estimated offering expenses payable by us in connection
with the Global Offering, and assuming an Offer Price of HK$14.78 per Share (being the
mid-point of the indicative Offer Price range of HK$13.72 and HK$15.83), we estimate that we
will receive net proceeds of approximately HK$2,886.8 million from the Global Offering.
We intend to use the proceeds from the Global Offering for the purposes and in the
amounts set forth below, subject to adjustments based on our evolving business needs and
changing market conditions:
(i) Approximately 50% of the net proceeds, or HK$1,443.4 million, is expected to be
used over the next five years for the upgrade and exploration of existing mines to
fully realize our growth potential. We will continue enhancing geological
exploration efforts and expanding exploration activities within existing mines while
exploring new mines on the outskirts of our mineralization areas. See “Business —
Development and Expansion” for details of our development and expansion plan.
 Approximately 30% or HK$866.0 million is expected to be allocated to our
operations in the PRC for exploration and mine development, including, but
not limited to, exploration projects in the deep and peripheral areas,
construction of shafts and access, purchase of equipment and machinery,
technical upgrades, construction of processing plants, expansion of open-pit
production, and other further expansion of mines for the years from 2025 to
2027. Specifically, this would include our expansion project of Jilong Gold
Mine for various types of exploration projects, the expansion projects of
Huatai Gold Mine, the phase II construction of Jintai Gold Mine, construction
of the new mining areas of the Wulong Gold Mine, and the expansion and
renovation projects of Hanfeng Polymetallic Mine. Such undertakings are
expected to increase our Reserves and extend LOMs, expand ore processing
capacity and production volume, further optimize our operating and capital
costs, and improve our operating efficiency and productivity.
 Approximately 20% or HK$577.4 million is expected to be allocated to our
operations in Laos and Ghana, including, but not limited to, construction of the
new power generation plants, exploration projects in the deep and peripheral
areas, construction of shafts, declines and access, purchase of equipment and
machinery, upgrades and expansion of existing processing plants, extending
open-pit mining to underground mining and other further expansions of mines
FUTURE PLANS AND USE OF PROCEEDS
– 591 –


--- page 603 ---
for the years from 2025 to 2027. For Sepon Gold and Copper Mine, we aim to
extend the LOM of the underground mine, purchase equipment and
exploration, renovate of the copper series and construct new energy power
generation. For Wassa Gold Mine, we target to use for the engineering costs
and other construction projects. Such undertakings are expected to expand ore
processing capacity and production volume, provide stable power sources to
our mining facilities, increase our Reserves and extend LOMs, to reduce our
carbon footprint and environmental impact, solidify our competitive edge,
enhance our operational efficiency, achieve economies of scale, and improve
overall profitability.
(ii) Approximately 40% of the net proceeds, or HK$1,154.7 million, is expected to be
used over the next three years to acquire sizable, high-quality mining assets
preferably with open-pit mines in countries with mature mining industries and stable
policies on mining industries. Our preferred potential mining acquisition targets are
expected to generate an annual production over 128 koz of gold. For more details of
our strategies of potential acquisition and criteria of identifying potential acquisition
targets, see “Business — Business Strategies — Continue to obtain resources and
reserves and increase production volume through domestic and overseas
acquisitions of high-quality gold assets for robust and sustainable growth.”
According to Frost & Sullivan, it is estimated that less than 60 potential acquisition
targets available in the global market meet our selection criteria. These potential
acquisition targets are located in regions such as Oceania, West Africa, Eastern and
Northern Europe, Central Asia, etc. We expect such acquisition would secure
valuable resources, increase our revenue and enhance financial performance,
diversify and reduce customer concentration risk and improve our competitive edge
in the market. Currently, we are still in the process of searching for potential targets
and have not identified any specific target, or participated in any commercial
negotiation or entered into any memorandum of understanding or letter of intent
with respect to any potential target. For future acquisition activities, we will comply
with relevant regulatory requirements.
(iii) Approximately 10% of the net proceeds, or HK$288.7 million, is expected to be
used for general corporate purposes.
In the event that the Offer Price is set at the maximum Offer Price or the minimum Offer
Price of the indicative Offer Price range, the net proceeds of the Global Offering will increase
by approximately HK$210.4 million or decrease by approximately HK$210.5 million.
The additional net proceeds that we would receive if the Over-allotment Option was to be
exercised in full would be: (i) HK$410.5 million (assuming an Offer Price of HK$15.83 per
Share, being the maximum Offer Price of the indicative Offer Price range); (ii) HK$442.0
million (assuming an Offer Price of HK$14.78 per Share, being the mid-point of the indicative
Offer Price range); and (iii) HK$473.6 million (assuming an Offer Price of HK$13.72 per
Share, being the minimum Offer Price of the indicative Offer Price range).
FUTURE PLANS AND USE OF PROCEEDS
– 592 –


--- page 604 ---
To the extent that the net proceeds from the Global Offering are either more or less than
expected, we will adjust our allocation of the net proceeds for the above purposes on a pro rata
basis.
To the extent that the net proceeds of the Global Offering are not immediately used for
the aforementioned purposes, we will only deposit such funds into short-term interest-bearing
accounts at licensed commercial banks and/or other authorized financial institutions (as
defined under the Securities and Futures Ordinance, or applicable laws and regulations in other
jurisdictions). In such event, we will comply with the appropriate disclosure requirements
under the Hong Kong Listing Rules.
As of the Latest Practicable Date, we believe that the future plans and use of proceeds are
still within the estimated range of our operational and financial needs and would not incur any
material adverse impact on the future business operation and financial performance. If any part
of our development plan does not proceed as planned for any reasons, such as changes in
government policies that would hinder the development of any of our projects or the
occurrence of force majeure events, the Directors will carefully evaluate the situation and may
reallocate the net proceeds from the Global Offering accordingly. We will issue an appropriate
announcement if there is any material change to the proposed use of proceeds in accordance
with the Hong Kong Listing Rules.
FUTURE PLANS AND USE OF PROCEEDS
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--- page 605 ---
HONG KONG UNDERWRITERS
CLSA Limited
Macquarie Capital Limited
China International Capital Corporation Hong Kong Securities Limited
ABCI Securities Company Limited
BOCI Asia Limited
ICBC International Securities Limited
Huatai Financial Holdings (Hong Kong) Limited
CCB International Capital Limited
Futu Securities International (Hong Kong) Limited
Livermore Holdings Limited
Shenwan Hongyuan Securities (H.K.) Limited
Victory Securities Company Limited
Star River Securities Limited
Tiger Brokers (HK) Global Limited
First Shanghai Securities Limited
UNDERWRITING
This Prospectus is published solely in connection with the Hong Kong Public Offering.
The Hong Kong Public Offering is fully underwritten by the Hong Kong Underwriters on a
conditional basis. The International Offering is expected to be fully underwritten by the
International Underwriters. If, for any reason, the Offer Price is not agreed between the Overall
Coordinators and our Company, the Global Offering will not proceed and will lapse.
The Global Offering comprises the Hong Kong Public Offering of initially 20,565,200
Hong Kong Offer Shares and the International Offering of initially 185,086,800 International
Offer Shares, subject, in each case, to reallocation on the basis as described in the section
headed “Structure of the Global Offering” in this Prospectus as well as to the Offer Size
Adjustment Option and the Over-allotment Option (in the case of the International Offering).
UNDERWRITING ARRANGEMENTS AND EXPENSES
Hong Kong Public Offering
Hong Kong Underwriting Agreement
Pursuant to the Hong Kong Underwriting Agreement, our Company is offering the Hong
Kong Offer Shares for subscription on the terms and conditions set out in this Prospectus and
the Hong Kong Underwriting Agreement at the Offer Price.
Subject to (a) the Stock Exchange granting approval for the listing of, and permission to
deal in, the H Shares to be issued pursuant to the Global Offering (including the H Shares
which may be issued pursuant to the exercise of the Offer Size Adjustment Option and the
Over-allotment Option), on the Main Board of the Stock Exchange and such approval not
UNDERWRITING
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--- page 606 ---
having been withdrawn; and (b) certain other conditions set out in the Hong Kong
Underwriting Agreement, the Hong Kong Underwriters have agreed severally but not jointly to
procure subscribers for, or themselves to subscribe for, their respective applicable proportions
of the Hong Kong Offer Shares being offered which are not taken up under the Hong Kong
Public Offering on the terms and conditions set out in this Prospectus and the Hong Kong
Underwriting Agreement.
The Hong Kong Underwriting Agreement is conditional on, among other things, the
International Underwriting Agreement having been executed and becoming unconditional and
not having been terminated in accordance with its terms.
Grounds for Termination
The Overall Coordinators (for itself and on behalf of the Hong Kong Underwriters), in
their sole and absolute discretion, shall have the right by giving a notice to our Company to
terminate the Hong Kong Underwriting Agreement with immediate effect if prior to 8:00 a.m.
on the Listing Date:
(a) there develops, occurs, exists or comes into effect:
(i) any new Law or any change or development involving a prospective change
(whether or not permanent) or any event or series of events or circumstance
likely to result in any change or development involving a prospective change
(whether or not permanent) in existing Law, or any change or development
involving a prospective change in the interpretation or application thereof by
any court or other competent Authority in or affecting Hong Kong, the PRC,
the United States, the United Kingdom, the European Union (or any of its
members), Japan, Singapore, Australia or any other jurisdiction where any
member of the Group is incorporated or established or operates or any other
jurisdiction relevant to any member of the Group or the Global Offering (each
a“ Relevant Jurisdiction ”); or
(ii) any change or development involving a prospective change (whether or not
permanent) or development, or any event or series of events likely to result in
or representing a change or development, or prospective change (whether or
not permanent) or development, in local, national, regional or international
financial, legal, political, military, industrial, economic, trading, currency
market, fiscal or regulatory market conditions, securities, exchange control or
any monetary or trading settlement system or other financial markets
(including, without limitation, conditions in stock and bond markets, money
and foreign exchange markets, inter-bank markets and credit markets) in or
affecting any Relevant Jurisdiction; or
UNDERWRITING
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--- page 607 ---
(iii) any event or circumstance or a series of events or circumstances, in the nature
of force majeure (including, without limitation, any act of government or order
of any courts, strike, calamity, crisis, lock-out, fire, explosion, flooding,
earthquake, civil commotion, act of war, outbreak or escalation of hostilities
(whether or not war is declared), act of God, act of terrorism (whether or not
responsibility has been claimed), declaration of a national or international
emergency, riot, public disorder, outbreak of diseases, pandemics or epidemics,
outbreak or escalation of disease (including infectious disease, including
without limitation COVID-19, SARS, MERS, H5N1, H1N1, swine or avian
influenza or such related/mutated forms) in each case beyond the control of the
Hong Kong Underwriters; or
(iv) the imposition or declaration of any moratorium, suspension or limitation
(including, without limitation, any imposition of or requirement for any
minimum or maximum price limit or price range) on trading in shares or
securities generally on the Stock Exchange, the New Y ork Stock Exchange, the
NASDAQ Global Market, the London Stock Exchange, the Shanghai Stock
Exchange, the Shenzhen Stock Exchange, the Singapore Stock Exchange or the
Tokyo Stock Exchange; or
(v) (a) any change or prospective change in or affecting taxation, foreign exchange
controls, currency exchange rates or foreign investment regulations (including,
without limitation, a devaluation of the Hong Kong dollar or RMB against any
foreign currencies, a change in the system under which the value of the Hong
Kong dollar is linked to that of the United States dollars or RMB is linked to
any foreign currency or currencies) or the implementation of any exchange
control, or (b) any change or prospective change in Taxation in any Relevant
Jurisdiction adversely affecting an investment in the H Shares; or
(vi) any general moratorium on commercial banking activities in or affecting any
of any Relevant Jurisdiction or any disruption in commercial banking or
foreign exchange trading or securities trading or securities settlement or
clearance services, procedures or matters in any Relevant Jurisdictions; or
(vii) the imposition of economic sanctions, or the withdrawal of trading privileges
which existed on the date of the Hong Kong Underwriting Agreement, in
whatever form, directly or indirectly, by, or for, any jurisdiction relevant to the
business operations of any member of the Group; or
(viii) any demand by creditors for repayment of indebtedness or an order or petition
being presented for the winding-up or liquidation of any Group Company or
any Group Company making any composition or arrangement with its creditors
or entering into a scheme of arrangement or any resolution being passed for the
UNDERWRITING
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--- page 608 ---
winding-up of any Group Company or a provisional liquidator, receiver or
manager being appointed over all or part of the assets or undertaking of any
Group Company or anything analogous thereto occurs in respect of any Group
Company; or
(ix) any change, development or event involving a prospective change in, or a
materialisation of, any of the risks set out in the section headed “Risk Factors”
in the Prospectus; or
(x) that any certificate given by the Company or any of its respective officers
under or in connection with the Hong Kong Underwriting Agreement or the
Global Offering is false or misleading; or
(xi) the commencement by any Authority or other regulatory or political body or
organization of any action or investigation against any Group company, any of
the Single Largest Shareholder Group or any Director or Supervisor or the
chief executive officer or the chief financial officer of the Company or an
announcement by any authority or regulatory or political body or organization
that it intends to take any such action or investigation; or
(xii) any non-compliance of the Prospectus, the CSRC filings (or any other
documents used in connection with the contemplated subscription and sale of
the Offer Shares) or any aspect of the Global Offering with the Companies
(WUMP) Ordinance, the Listing Rules, the CSRC Rules or any other
applicable Laws; or
(xiii) that any statement contained in any notice, announcement, advertisement,
communication issued or used (by or on behalf of the Company) in connection
with the Hong Kong Public Offering (including any supplement or amendment
thereto) was or has become untrue, incomplete, inaccurate, incorrect or
misleading or deceptive, or any forecast, estimate, expression of opinion,
intention or expectation expressed in any notice, announcement,
advertisement, communication so issued or used is not fair and honest and
made on reasonable grounds or, where appropriate, based on reasonable
assumptions, when taken as a whole; or
(xiv) any matter has arisen or has been discovered which would, had it arisen or been
discovered immediately before the date of the Prospectus, constitute a material
omission from any notices, announcements, advertisements, communications
or other documents arising out of, relating to or connected with the Company,
the Group or the Global Offering (whether or not approved by any Hong Kong
Underwriter), or any amendment or supplement thereto; or
UNDERWRITING
– 597 –


--- page 609 ---
(xv) any contravention by any Group Company, any member of the Single Largest
Shareholder Group, or any Director or any Supervisor or the chief executive
officer or the chief financial officer of the Company of the Companies
Ordinance, the PRC Company Law or other applicable Laws; or
(xvi) any litigation, dispute, legal action, claim, investigation or other action
(including arrest or detainment) or proceedings being commenced, threatened
or instigated against any of the Company, its Subsidiaries, any member of the
Single Largest Shareholder Group or any Director or Supervisor or any
member of the Group’s senior management,
which, in any such case individually or in the aggregate, in the sole and absolute
opinion of the Overall Coordinators (for themselves and on behalf of the Hong Kong
Underwriters):
(1) is, will be or may be materially adverse to, or materially and prejudicially
affects, the assets, liabilities, business, general affairs, management, prospects,
shareholder’s equity, profitability, results of operations, position or condition
(financial, operational, trading or otherwise), or performance or prospects of
the Group as a whole; or
(2) has, will have or may have a material adverse effect on the success or
marketability of the Global Offering or the level of Offer Shares being applied
for, under the Hong Kong Public Offering or the level of interest under the
International Offering or anticipated dealings in the H Shares in the secondary
market; or
(3) makes, will make it or may make it impracticable or inadvisable or incapable
or inexpedient to proceed with the Hong Kong Public Offering and/or the
International Offering or the delivery of the Offer Shares on the terms and in
the manner contemplated by the Prospectus, the formal notice, the preliminary
offering circular or the final offering circular; or
(4) would have or may have the effect of making any part of the Hong Kong
Underwriting Agreement (including underwriting) incapable of performance in
accordance with its terms or which prevents the processing of applications
and/or payments pursuant to the Global Offering or pursuant to the
underwriting thereof; or
(b) there comes to the notice of the Overall Coordinators as at or after the date of the
Hong Kong Underwriting Agreement:
(i) a governmental, regulatory or other prohibition on the Company for whatever
reason from issuing, selling the H Shares (including the Option Shares)
pursuant to the terms of the Global Offering; or
UNDERWRITING
– 598 –


--- page 610 ---
(ii) that any statement contained in any of the Hong Kong public offering
documents, the Application Proof Prospectus, the Post Hearing Information
Pack (“ PHIP ”) and the Formal Notice was or has become untrue, incomplete,
inaccurate, incorrect or misleading or deceptive, or any forecast, estimate,
expression of opinion, intention or expectation expressed in any of the Hong
Kong public offering documents, the application proof of the Prospectus
(“Application Proof Prospectus ”), the PHIP and the Formal Notice is not fair
and honest and made on reasonable grounds or, where appropriate, based on
reasonable assumptions, when taken as a whole; or
(iii) any matter has arisen or has been discovered which would, had it arisen or been
discovered immediately before the date of the Prospectus, constitute a material
omission from any of the Offering Documents, the Application Proof
Prospectus, the PHIP , the Formal Notice, or any amendment or supplement
thereto; or
(iv) any contravention by any Group Company, any member of the Single Largest
Shareholder Group, or any Director or any Supervisor or the chief executive
officer or the chief financial officer of the Company of the Companies
(WUMP) Ordinance, the PRC Company Law, the CSRC Rules or the Listing
Rules; or
(v) any non-compliance of the Prospectus (or any other documents used in
connection with the contemplated subscription of the Offer Shares) or any
aspect of the Global Offering with the Companies (WUMP) Ordinance or the
Listing Rules; or
(vi) either (a) there has been a breach of any of the representations, warranties,
undertakings or provisions of either the Hong Kong Underwriting Agreement
or the International Underwriting Agreement by the Company or (b) any of the
representations, warranties and undertakings given by the Company in the
Hong Kong Underwriting Agreement or the International Underwriting
Agreement, as applicable, is (or would when repeated be) untrue, inaccurate or
misleading; or
(vii) any of the experts named in the Prospectus (except the Sole Sponsor) has
withdrawn its consent to the issue of the Prospectus with the inclusion of its
reports, letters, summaries or legal opinions (as the case may be) and
references to its name included in the form and context in which it respectively
appears; or
UNDERWRITING
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--- page 611 ---
(viii) any event, act or omission which gives or is likely to give rise to any liability
of the Company pursuant to the indemnities given by the Company under the
Hong Kong Underwriting Agreement or the International Underwriting
Agreement; or
(ix) any breach of any of the obligations of the Company under the Hong Kong
Underwriting Agreement or the International Underwriting Agreement; or
(x) a significant portion of the orders in the book-building process at the time the
International Underwriting Agreement is entered into, or the investment
commitments by any cornerstone investors after signing of the Cornerstone
Investor Agreements, has been withdrawn, terminated or cancelled; or
(xi) the Company has withdrawn the Prospectus (and/or any other documents
issued or used in connection with the Global Offering) or the Global Offering;
or
(xii) any member of the Single Largest Shareholder Group, any Director or any
Supervisor or any member of the Group’s senior management being charged
with an indictable offence or prohibited by Laws or otherwise disqualified
from taking part in the management of a company; or
(xiii) any of the Director, chairman, the president, the chief executive officer or the
chief financial officer or member of senior management of the Group vacating
his office; or
(xiv) any material adverse change or any development involving a prospective
adverse change in or affecting the assets, liabilities, business, general affairs,
management, prospects, shareholders’ equity, profitability, results of
operations, position or condition (financial or otherwise) or performance, of
any Group Company or the Group as a whole; or
(xv) the issue or requirement to issue by the Company of a supplemental or
amendment to the Prospectus, preliminary offering circular or Offering
Circular or other documents in connection with the offer and sale of the H
Shares pursuant to the Companies (WUMP) Ordinance or the Listing Rules or
upon any requirement or request of the Stock Exchange or the SFC, in
circumstances where the matter to be disclosed could, in the sole and absolute
opinion of the Overall Coordinators, materially and adversely affect the
marketing for or implementation of the Global Offering; or
UNDERWRITING
– 600 –


--- page 612 ---
(xvi) any material adverse change, or any development or any prospective adverse
change or development, in the condition (financial or otherwise) or in the
assets, liabilities, business, general affairs, management, prospects,
shareholders’ equity, profits, losses, results of operations, position or
condition, financial or otherwise, or performance of the Group as a whole; or
(xvii) the Admission is refused or not granted, other than subject to customary
conditions, on or before the Listing Date, or if granted, the Admission is
subsequently withdrawn, cancelled, qualified (other than by customary
conditions), revoked or withheld.
Offer Size Adjustment Option
As part of the Global Offering, the Company has the Offer Size Adjustment Option under
the Hong Kong Underwriting Agreement, pursuant to which, the Company may issue and allot
any number of up to an aggregate of 30,847,800 H Shares, representing approximately 15% of
the Offer Shares initially offered under the Global Offering, at the Offer Price, to cover
additional market demand, if any. The Offer Size Adjustment Option may be exercised jointly
by the Company and the Overall Coordinators prior to the execution of the International
Underwriting Agreement and will expire upon execution of the International Underwriting
Agreement. These additional Offer Shares (the “ Offer Size Adjustment Option Shares ”), if
any, will be allocated in such manner as closely as practicable to maintain the proportionality
between the Hong Kong Public Offering and the International Offering following the
application of the reallocation arrangement described in “Structure of the Global Offering —
The Hong Kong Public Offering — Reallocation” below and the Sponsor-Overall Coordinator
shall allocate additional new H Shares to be offered by the Company pursuant to the
International Offering to the Hong Kong Public Offering in order to maintain such
proportionality and the relevant number of Offer Size Adjustment Option Shares shall be
allocated to the International Offering to maintain such proportionality.
Undertakings to the Hong Kong Stock Exchange pursuant to the Hong Kong Listing Rules
Undertakings by our Company
Pursuant to Rule 10.08 of the Listing Rules, our Company has undertaken to the Stock
Exchange that it will not issue any further Shares or securities convertible into equity securities
of our Company (whether or not of a class already listed) or enter into any agreement to such
an issue within six months from the Listing Date (whether or not such issue of Shares or
securities will be completed within six months from the Listing Date), except for (a) pursuant
to the Global Offering (including the Over-allotment Option); or (b) under any of the
circumstances provided under Rule 10.08 of the Listing Rules.
UNDERWRITING
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--- page 613 ---
Undertakings by our Single Largest Shareholder Group
Each member of our Single Largest Shareholder Group has voluntarily undertaken to us
and that except pursuant to the Global Offering (including the Offer Size Adjustment Option
and the Over-allotment Option), he/she/it will not, and will procure that the relevant registered
holder(s) will not, without the prior written consent of the Overall Coordinators and unless
otherwise in compliance with the applicable requirements of the Listing Rules:
(a) in the period commencing on the date by reference to which disclosure of its
shareholdings in our Company is made in this Prospectus and ending on the date
which is six months from the Listing Date, either directly or indirectly, dispose of,
nor enter into any agreement to dispose of or otherwise create any options, rights,
interests or encumbrances in respect of, any of our securities that he/she/it is shown
to beneficially own in this Prospectus (the “ Relevant Shares ”); or
(b) in the period of a further six months commencing on the date on which the period
referred to in paragraph (a) above expires, either directly or indirectly, dispose of,
nor enter into any agreement to dispose of or otherwise create any options, rights,
interests or encumbrances in respect of, any of the Relevant Shares if, immediately
following such disposal or upon the exercise or enforcement of such options, rights,
interests or encumbrances, they would together with other members of our Single
Largest Shareholder Group cease to be the Single Largest Shareholder Group of our
Company.
Each member of our Single Largest Shareholder Group has further undertaken to us that,
within the period commencing on the date by reference to which disclosure of his/her/its
shareholdings in our Company is made in this Prospectus and ending on the date which is 12
months from the Listing Date, he/she/it will and will procure that the relevant registered
holder(s) will:
(a) when he/she/it pledges or charges any securities in our Company beneficially owned
by him/her/it in favor of an authorized institution, immediately inform us in writing
of such pledge or charge together with the number of our securities so pledged or
charged; and
(b) when he/she/it receives indications, either verbal or written, from the pledgee or
chargee that any of our pledged or charged securities beneficially owned by
him/her/it will be disposed of, immediately inform us in writing of such indications.
Our Company will, as soon as we have been informed of the matters referred to in
paragraphs (a) and (b) above (if any) by any member of our Single Largest Shareholder Group
and subject to the then requirements of the Listing Rules, disclose such matters by way of an
announcement which is published in accordance with Rule 2.07C of the Listing Rules as soon
as possible.
UNDERWRITING
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--- page 614 ---
Undertakings pursuant to the Hong Kong Underwriting Agreement
Undertakings by our Company
Pursuant to the Hong Kong Underwriting Agreement, save for the issue, offer or sale of
the Offer Shares by our Company pursuant to the Global Offering (including pursuant to the
exercise of the Offer Size Adjustment Option and/or the Over-allotment Option), during the
period commencing on the date of the Hong Kong Underwriting Agreement and ending on, and
including, the date falling six months after the Listing Date (the “ First Six-Month Period ”),
our Company has undertaken to each of the Sole Sponsor, the Overall Coordinators, the Joint
Bookrunner, the Joint Lead Manager, the Hong Kong Underwriters and the Capital Market
Intermediaries not to, without the prior written consent of the Sole Sponsor and Overall
Coordinators (for themselves and on behalf of the Hong Kong Underwriters) and unless in
compliance with the Listing Rules:
(a) allot, issue, sell, accept subscription for, offer to allot, issue or sell, contract or agree
to allot, issue or sell, assign, mortgage, charge, pledge, assign, hypothecate, lend,
grant or sell any option, warrant, contract or right to subscribe for or purchase, grant
or purchase any option, warrant, contract or right to allot, issue or sell, or otherwise
transfer or dispose of or create an Encumbrance (as defined in the Hong Kong
Underwriting Agreement) over, or agree to transfer or dispose of or create an
Encumbrance (as defined in the Hong Kong Underwriting Agreement) over, either
directly or indirectly, conditionally or unconditionally, or repurchase, any legal or
beneficial interest in the share capital or any other equity securities of our Company
or any shares or other equity securities of members of our Group, as applicable, or
any interest in any of the foregoing (including, without limitation, any securities
convertible into or exchangeable or exercisable for or that represents the right to
receive, or any warrants or other rights to purchase any Shares or any other share
capital or other equity securities of our Company or members of our Group, as
applicable), or deposit any share capital or other equity securities of our Company
or any member of our Group, as applicable, with a depositary in connection with the
issue of depositary receipts; or
(b) enter into any swap or other arrangement that transfers to another, in whole or in
part, any of the economic consequences of ownership (legal or beneficial) of our H
Shares or any other equity securities of our Company or any shares or other equity
securities of any members of our Group, as applicable, or any interest in any of the
foregoing (including, without limitation, any securities convertible into or
exchangeable or exercisable for or that represent the right to receive, or any warrants
or other rights to purchase, any Shares or any other equity securities of our Company
or any shares or any other equity securities of any members of our Group, as
applicable); or
(c) enter into any transaction with the same economic effect as any transaction
described in paragraph (a) or (b) above; or
UNDERWRITING
– 603 –


--- page 615 ---
(d) offer to or agree to do any of the foregoing or announce any intention to do so, in
each case, whether any of the foregoing transactions is to be settled by delivery of
share capital or such other equity securities, in cash or otherwise (whether or not the
issue of such share capital or other equity securities will be completed within the
First Six Month Period). Our Company further agrees that, in the event our
Company is allowed to enter into any of the transactions described in paragraph (a),
(b) or (c) above or offers to or agrees to or announces any intention to effect any
such transaction during the period of six months commencing on the date on which
the First Six Month Period expires (the “ Second Six Month Period ”), it will take
all reasonable steps to ensure that such an issue or disposal will not, and no other
act of our Company will, create a disorderly or false market for any Shares or other
securities of our Company.
Hong Kong Underwriters’ Interests in our Company
Save for their respective obligations under the Hong Kong Underwriting Agreement, as
of the Latest Practicable Date, none of the Hong Kong Underwriters was interested, legally or
beneficially, directly or indirectly, in any H Shares or any securities of any member of our
Group or had any right or option (whether legally enforceable or not) to subscribe for or to
nominate persons to subscribe for securities in our Company.
Following the completion of the Global Offering, the Hong Kong Underwriters and their
affiliated companies may hold a certain portion of our H Shares as a result of fulfilling their
respective obligations under the Hong Kong Underwriting Agreement.
International Offering
International Underwriting Agreement
In connection with the International Offering, our Company and our Single Largest
Shareholder Group expect to enter into the International Underwriting Agreement with the
Overall Coordinators and the International Underwriters on or around the Price Determination
Date. Under the International Underwriting Agreement and subject to the Offer Size
Adjustment Option and the Over-allotment Option, the International Underwriters would,
subject to certain conditions set out therein, agree severally but not jointly to procure
subscribers for, or themselves to subscribe for, their respective applicable proportions of the
International Offer Shares initially being offered pursuant to the International Offering. It is
expected that the International Underwriting Agreement may be terminated on similar grounds
as the Hong Kong Underwriting Agreement. Potential investors should note that in the event
that the International Underwriting Agreement is not entered into or is terminated, the Global
Offering will not proceed. See “Structure of the Global Offering — The International
Offering”.
UNDERWRITING
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--- page 616 ---
Over-allotment Option
Our Company is expected to grant to the International Underwriters the Over-allotment
Option, exercisable by the Overall Coordinators on behalf of the International Underwriters at
any time from the Listing Date until 30 days after the last day for lodging applications under
the Hong Kong Public Offering, pursuant to which our Company may be required to issue up
to an aggregate of 30,847,800 H Shares, representing not more than 15% of the number of
Offer Shares initially available under the Global Offering assuming the Offer Size Adjustment
Option is not exercised at all) or up to an aggregate of 35,474,800 additional H Shares
(representing approximately 15% of the total number of Offer Shares being offered under the
Global Offering assuming the Offer Size Adjustment Option is exercised in full), at the Offer
Price, to cover over-allocations in the International Offering, if any. See “Structure of the
Global Offering — Over-allotment Option.”
Commissions and Expenses
The Underwriters and the Capital Market Intermediaries will receive an underwriting
commission of 1.8% of the aggregate Offer Price of all the Offer Shares (the “ Fixed Fee ”),
including any Offer Shares to be issued pursuant to the exercise of the Offer Size Adjustment
Option and the Over-allotment Option, out of which they will pay any sub-underwriting
commissions and other fees.
The Underwriters and the Capital Market Intermediaries may receive a discretionary
incentive fee of up to 1.2% of the aggregate Offer Price of all the Offer Shares (including any
Offer Shares to be issued pursuant to the exercise of the Offer Size Adjustment Option and the
Over-allotment Option) (the “ Discretionary Fee ”). The ratio of the Fixed Fee and the
Discretionary Fee (if fully paid) payable to all Underwriters is therefore 46.5:53.5. The
incentive fee is discretionary in nature and the payment of such is subject to the sole discretion
of our Company.
For any unsubscribed Hong Kong Offer Shares reallocated to the International Offering,
the underwriting commission will not be paid to the Hong Kong Underwriters but will instead
be paid, at the rate applicable to the International Offering, to the relevant International
Underwriters.
The aggregate underwriting commissions payable to the Underwriters in relation to the
Global Offering (based on the Offer Price of HK$14.78 per Offer Share, which is a mid-point
of the Offer Price Range, and assuming the full payment of the Discretionary Fee and the
exercise of the Offer Size Adjustment Option and the Over-allotment Option in full) will be
approximately HK$120.6 million.
The aggregate underwriting commissions and fees together with the Stock Exchange
listing fees, the AFRC transaction levy, the SFC transaction levy and the Stock Exchange
trading fee, legal and other professional fees and printing and all other expenses relating to the
Global Offering are estimated to be approximately HK$181.1 million (based on the Offer Price
UNDERWRITING
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--- page 617 ---
of HK$14.78 per Offer Share, which is the mid-point of the Offer Price Range, and assuming
the full payment of the Discretionary Fee and assuming the Offer Size Adjustment Option and
the Over-allotment Option is exercised in full), which will be made by our Company.
Sole Sponsor’s Fee
An amount of US$500,000 is payable by our Company as sponsor fee to the Sole Sponsor.
Indemnity
Each member of our Company and our Single Largest Shareholder Group has agreed to
indemnify the Hong Kong Underwriters for certain losses which they may suffer or incur,
including losses arising from the performance of their obligations under the Hong Kong
Underwriting Agreement and any breach by any of our Company and any member of our Single
Largest Shareholder Group of the Hong Kong Underwriting Agreement.
ACTIVITIES BY SYNDICATE MEMBERS
The underwriters of the Hong Kong Public Offering and the International Offering
(together, the “ Syndicate Members ”) and their affiliates may each individually undertake a
variety of activities (as further described below) which do not form part of the underwriting or
stabilizing process.
The Syndicate Members and their affiliates are diversified financial institutions with
relationships in countries around the world. These entities engage in a wide range of
commercial and investment banking, loan financing, brokerage, funds management, trading,
hedging, investing and other activities for their own account and for the account of others. In
the ordinary course of their various business activities, the Syndicate Members and their
respective affiliates may purchase, sell or hold a broad array of investments and actively trade
securities, derivatives, loans, commodities, currencies, credit default swaps and other financial
instruments for their own account and for the accounts of their customers. Such investment and
trading activities may involve or relate to assets, securities and/or instruments of our Company
and/or persons and entities with relationships with our Company and may also include swaps
and other financial instruments entered into for hedging purposes in connection with our
Group’s loans and other debt.
In relation to our H Shares, those activities of the Syndicate Members and their affiliates
could include acting as agent for buyers and sellers of our H Shares, entering into transactions
with those buyers and sellers in a principal capacity, including as a lender to initial purchasers
of the H Shares (which financing may be secured by the H Shares) in the Global Offering,
proprietary trading in our H Shares and entering into over the counter or listed derivative
transactions or listed or unlisted securities transactions (including issuing securities such as
derivative warrants listed on a stock exchange) which have our H Shares as their underlying
assets or part of their underlying assets. Such transactions may be carried out as bilateral
agreements or trades with selected counterparties. Those activities may require hedging
activity by those entities involving, directly or indirectly, the buying and selling of our H
Shares, which may have a negative impact on the trading price of our H Shares. All such
UNDERWRITING
– 606 –


--- page 618 ---
activities could occur in Hong Kong and elsewhere in the world and may result in the Syndicate
Members and their affiliates holding long and/or short positions in our H Shares, in baskets of
securities or indices including our H Shares, in units of funds that may purchase our H Shares,
or in derivatives related to any of the foregoing.
In relation to issues by Syndicate Members or their affiliates of any listed securities
having our H Shares as their or part of their underlying securities, whether on the Stock
Exchange or on any other stock exchange, the rules of the stock exchange may require the
issuer of those securities (or one of its affiliates or agents) to act as a market maker or liquidity
provider in the security, and this will also result in hedging activity in our H Shares in most
cases.
All such activities may occur both during and after the end of the stabilizing period
described in the section headed “Structure of the Global Offering.” Such activities may affect
the market price or value of our H Shares, the liquidity or trading volume in our H Shares and
the volatility of the price of our H Shares, and the extent to which this occurs from day to day
cannot be estimated.
It should be noted that when engaging in any of these activities, the Syndicate Members
will be subject to certain restrictions, including the following:
(a) the Syndicate Members (other than the Stabilizing Manager or any person acting for
it) must not, in connection with the distribution of the Offer Shares, effect any
transactions (including issuing or entering into any option or other derivative
transactions relating to the Offer Shares), whether in the open market or otherwise,
with a view to stabilizing or maintaining the market price of any of the Offer Shares
at levels other than those which might otherwise prevail in the open market; and
(b) the Syndicate Members must comply with all applicable laws and regulations,
including the market misconduct provisions of the SFO, including the provisions
prohibiting insider dealing, false trading, price rigging and stock market
manipulation.
Certain of the Syndicate Members or their respective affiliates have provided from time
to time, and expect to provide in the future, investment banking, loan financing and other
services to our Company and its affiliates for which such Syndicate Members or their
respective affiliates have received or will receive customary fees and commissions.
In addition, the Syndicate Members or their respective affiliates may provide financing to
investors to finance their subscriptions of the Offer Shares in the Global Offering.
INDEPENDENCE AND INTERESTS OF THE SOLE SPONSOR
As of the Latest Practicable Date, the Sole Sponsor satisfied the independence criteria
applicable to sponsors set out in Rule 3A.07 of the Listing Rules. As of the Latest Practicable
Date, the Sole Sponsor and its affiliates had no interest in our Group.
UNDERWRITING
– 607 –


--- page 619 ---
THE GLOBAL OFFERING
This Prospectus is published in connection with the Hong Kong Public Offering as part
of the Global Offering. CITIC Securities (Hong Kong) Limited is the Sole Sponsor and CLSA
Limited is the Sponsor-Overall Coordinator of the Global Offering, and Macquarie Capital
Limited as one of the Overall Coordinators of the Global Offering.
The Listing of our H Shares on the Stock Exchange is sponsored by the Sole Sponsor. The
Sole Sponsor has made an application on behalf of our Company to the Stock Exchange for the
listing of, and permission to deal in, our H Shares in issue and to be issued as mentioned in
this Prospectus.
205,652,000 Offer Shares will initially be made available under the Global Offering
comprising:
(a) the Hong Kong Public Offering of initially 20,565,200 H Shares (subject to
reallocation, the Offer Size Adjustment Option and the Over-allotment Option) in
Hong Kong as described in the sub-section “— The Hong Kong Public Offering” in
this section below; and
(b) the International Offering of initially 185,086,800 H Shares (subject to reallocation,
the Offer Size Adjustment Option and the Over-allotment Option) outside the United
States (including to professional and institutional investors within Hong Kong) in
offshore transactions in reliance on Regulation S, as described in the sub-section
headed “— The International Offering” in this section below.
Investors may either:
(i) apply for Hong Kong Offer Shares under the Hong Kong Public Offering; or
(ii) apply for or indicate an interest for International Offer Shares under the
International Offering, but may not do both.
The Offer Shares will represent approximately 11.0% of the enlarged issued share capital
of our Company immediately following the completion of the Global Offering, assuming the
Offer Size Adjustment Option and the Over-allotment Option are not exercised. If the Offer
Size Adjustment Option and the Over-allotment Option are exercised in full, the Offer Shares
will represent approximately 14.3% of the enlarged issued share capital of our Company
immediately following the completion of the Global Offering.
References in this Prospectus to applications, application monies or the procedure for
applications relate solely to the Hong Kong Public Offering.
STRUCTURE OF THE GLOBAL OFFERING
– 608 –


--- page 620 ---
THE HONG KONG PUBLIC OFFERING
Number of Offer Shares initially offered
Our Company is initially offering 20,565,200 H Shares for subscription by the public in
Hong Kong at the Offer Price, representing approximately 10.0% of the total number of Offer
Shares initially available under the Global Offering. The number of Offer Shares initially
offered under the Hong Kong Public Offering, subject to any reallocation of Offer Shares
between the International Offering and the Hong Kong Public Offering, will represent
approximately 1.1% of the enlarged issued share capital of our Company immediately
following the completion of the Global Offering (assuming the Offer Size Adjustment Option
and the Over-allotment Option are not exercised).
The Hong Kong Public Offering is open to members of the public in Hong Kong as well
as to institutional and professional investors. Professional investors generally include brokers,
dealers, companies (including fund managers) whose ordinary business involves dealing in
shares and other securities and corporate entities that regularly invest in shares and other
securities.
Completion of the Hong Kong Public Offering is subject to the conditions set out in the
sub-section headed “— Conditions of the Global Offering” in this section.
Allocation
Allocation of Offer Shares to investors under the Hong Kong Public Offering will be
based solely on the level of valid applications received under the Hong Kong Public Offering.
The basis of allocation may vary, depending on the number of Hong Kong Offer Shares validly
applied for by applicants. Such allocation could, where appropriate, consist of balloting, which
could mean that some applicants may receive a higher allocation than others who have applied
for the same number of Hong Kong Offer Shares, and those applicants who are not successful
in the ballot may not receive any Hong Kong Offer Shares.
For allocation purposes only, the total number of Hong Kong Offer Shares available under
the Hong Kong Public Offering (after taking into account any reallocation referred to below)
will be divided equally (to the nearest board lot) into two pools: pool A and pool B (with any
odd lot being allocated to pool A). The Hong Kong Offer Shares in pool A will be allocated
on an equitable basis to applicants who have applied for Hong Kong Offer Shares with an
aggregate price of HK$5 million (excluding the brokerage, the AFRC transaction levy, the SFC
transaction levy and the Stock Exchange trading fee payable) or less. The Hong Kong Offer
Shares in pool B will be allocated on an equitable basis to applicants who have applied for
Hong Kong Offer Shares with an aggregate price of more than HK$5 million (excluding the
brokerage, the AFRC transaction levy, the SFC transaction levy and the Stock Exchange
trading fee payable) and up to the total value in pool B.
STRUCTURE OF THE GLOBAL OFFERING
– 609 –


--- page 621 ---
Investors should be aware that applications in pool A and applications in pool B may
receive different allocation ratios. If any Hong Kong Offer Shares in one (but not both) of the
pools are unsubscribed, such unsubscribed Hong Kong Offer Shares will be transferred to the
other pool to satisfy demand in that other pool and be allocated accordingly. For the purpose
of the immediately preceding paragraph only, the “price” for Hong Kong Offer Shares means
the price payable on application therefor (without regard to the Offer Price as finally
determined). Applicants can only receive an allocation of Hong Kong Offer Shares from either
pool A or pool B and not from both pools. Multiple or suspected multiple applications under
the Hong Kong Public Offering and any application for more than 10,282,600 Hong Kong
Offer Shares (being approximately 50% of the Hong Kong Offer Shares initially available
under the Hong Kong Public Offering) is liable to be rejected.
Reallocation
The allocation of Offer Shares between the Hong Kong Public Offering and the
International Offering is at the discretion of the Overall Coordinators, subject to reallocation.
According to Chapter 4.14 (Offering-related Mechanisms) of the Guide and paragraph 4.2 of
Practice Note 18 of the Listing Rules, a clawback mechanism shall be put in place which would
have the effect of increasing the number of Offer Shares under the Hong Kong Public Offering
to a certain percentage of the total number of Offer Shares offered under the Global Offering
if certain prescribed total demand levels are reached as further described below.
20,565,200 Offer Shares are initially available in the Hong Kong Public Offering,
representing approximately 10.0% of the Offer Shares initially available for subscription under
the Global Offering. If the number of Offer Shares validly applied for under the Hong Kong
Public Offering represents (a) 15 times or more but less than 50 times, (b) 50 times or more
but less than 100 times and (c) 100 times or more of the total number of Offer Shares initially
available under the Hong Kong Public Offering, then Offer Shares will be reallocated to the
Hong Kong Public Offering from the International Offering. As a result of such reallocation
and assuming the Offer Size Adjustment Option is not exercised, the total number of Offer
Shares available under the Hong Kong Public Offering will be increased to 61,695,600 Offer
Shares (in the case of (a)), 82,260,800 Offer Shares (in the case of (b)) and 102,826,000 Offer
Shares (in the case of (c)), representing approximately 30%, 40% and 50% of the total number
of Offer Shares initially available under the Global Offering, respectively (before the exercise
of the Over-allotment Option) (the “ PN18 Clawback ”). In each case, the additional Offer
Shares reallocated to the Hong Kong Public Offering will be allocated between pool A and pool
B and the number of Offer Shares allocated to the International Offering will be
correspondingly reduced in such manner as the Overall Coordinators deems appropriate.
In addition, the Overall Coordinators may allocate Offer Shares from the International
Offering to the Hong Kong Public Offering to satisfy valid applications under the Hong Kong
Public Offering.
STRUCTURE OF THE GLOBAL OFFERING
– 610 –


--- page 622 ---
If the Hong Kong Public Offering is not fully subscribed, the Overall Coordinators may
reallocate all or any unsubscribed Hong Kong Offer Shares to the International Offering, in
such proportions as they deem appropriate.
The Overall Coordinators may, at its discretion, reallocate Offer Shares initially allocated
for the International Offering to the Hong Kong Public Offering to satisfy valid applications
in pool A and pool B under the Hong Kong Public Offering in accordance with Chapter 4.14
of the Guide for New Listing Applicants. In the event that (i) the International Offer Shares are
undersubscribed and the Hong Kong Offer Shares are fully subscribed or oversubscribed
irrespective of the number of times; or (ii) the International Offer Shares are fully subscribed
or oversubscribed and the Hong Kong Offer Shares are fully subscribed or oversubscribed as
to less than 15 times of the number of Hong Kong Offer Shares initially available under the
Hong Kong Public Offering, and provided that the Offer Price would be set at HK$13.72
(low-end of the Offer Price range), up to 20,565,200 Offer Shares (assuming the Offer Size
Adjustment Option is not exercised) may be reallocated to the Hong Kong Public Offering from
the International Offering, so that the total number of the Offer Shares available under the
Hong Kong Public Offering will be the lesser of: (i) double of initial allocation under the Hong
Kong Public Offering; and (ii) 30% of the total offering (assuming the Offer Size Adjustment
Option is not exercised) (the “ Allocation Cap ”).
The Offer Shares to be offered in the Hong Kong Public Offering and the Offer Shares
to be offered in the International Offering may, in certain circumstances, be reallocated
between these offerings at the discretion of the Overall Coordinators, subject to the PN18
Clawback and the Allocation Cap (as applicable).
Applications
Each applicant under the Hong Kong Public Offering will be required to give an
undertaking and confirmation in the application submitted by him/her/it that he/she/it and any
person(s) for whose benefit he/she/it is making the application has not applied for or taken up,
or indicated an interest for, and will not apply for or take up, or indicate an interest for, any
International Offer Shares under the International Offering. Such applicant’s application is
liable to be rejected if such undertaking and/or confirmation is/are breached and/or untrue (as
the case may be) or if he/she/it has been or will be placed or allocated International Offer
Shares under the International Offering.
Applicants under the Hong Kong Public Offering are required to pay, on application
(subject to application channel), the maximum Offer Price in addition to the brokerage, the
AFRC transaction levy, the SFC transaction levy and the Stock Exchange trading fee payable
on each Offer Share, amounting to a total of HK$3,197.93 for one board lot of 200 H Shares.
If the Offer Price, as finally determined in the manner described in “— Pricing and Allocation”
below, is less than the maximum Offer Price, appropriate refund payments (including the
brokerage, the AFRC transaction levy, the SFC transaction levy and the Stock Exchange
trading fee attributable to the surplus application monies) will be made to successful
applicants, without interest. Further details are set out in the section headed “How to Apply for
Hong Kong Offer Shares” in this Prospectus.
STRUCTURE OF THE GLOBAL OFFERING
–6 1 1–


--- page 623 ---
THE INTERNATIONAL OFFERING
Number of Offer Shares initially offered
The International Offering will consist of an offering of initially 185,086,800 H Shares,
representing approximately 90.0% of the total number of Offer Shares initially available under
the Global Offering (subject to reallocation, the Offer Size Adjustment Option and the
Over-allotment Option). The number of Offer Shares initially offered under the International
Offering, subject to any reallocation of Offer Shares between the International Offering and the
Hong Kong Public Offering, will represent approximately 9.9% of the enlarged share capital
of our Company immediately following the completion of the Global Offering (assuming the
Offer Size Adjustment Option and the Over-allotment Option are not exercise).
Allocation
The International Offering will include selective marketing of Offer Shares to
institutional and professional investors and other investors anticipated to have a sizeable
demand for such Offer Shares in Hong Kong and other jurisdictions outside the United States
in reliance on Regulation S. Professional investors generally include brokers, dealers,
companies (including fund managers) whose ordinary business involves dealing in shares and
other securities and corporate entities that regularly invest in shares and other securities.
Allocation of Offer Shares pursuant to the International Offering will be effected in accordance
with the “book-building” process described in the sub-section headed “Pricing and Allocation”
below in this section and based on a number of factors, including the level and timing of
demand, the total size of the relevant investor’s invested assets or equity assets in the relevant
sector and whether or not it is expected that the relevant investor is likely to buy further Offer
Shares and/or hold or sell its Offer Shares after the Listing. Such allocation is intended to result
in a distribution of the Offer Shares on a basis which would lead to the establishment of a solid
professional and institutional shareholder base to the benefit of our Group and the Shareholders
as a whole.
The Overall Coordinators (for itself and on behalf of the Underwriters) may require any
investor who has been offered Offer Shares under the International Offering and who has made
an application under the Hong Kong Public Offering to provide sufficient information to the
Overall Coordinators so as to allow it to identify the relevant applications under the Hong
Kong Public Offering and to ensure that it is excluded from any allocation of Offer Shares
under the Hong Kong Public Offering.
Reallocation
The total number of Offer Shares to be issued or sold pursuant to the International
Offering may change as a result of the clawback arrangement described in the subsection “—
The Hong Kong Public Offering — Reallocation” in this section above, the exercise of the
Offer Size Adjustment Option in whole or in part as described in the subsection headed
“— Offer Size Adjustment Option” and the exercise of the Over-allotment Option in whole or
in part as described in the subsection headed “— Over-allotment Option” and/or any
reallocation of unsubscribed Offer Shares originally included in the Hong Kong Public
Offering.
STRUCTURE OF THE GLOBAL OFFERING
– 612 –


--- page 624 ---
OFFER SIZE ADJUSTMENT OPTION
As part of the Global Offering, the Company has the Offer Size Adjustment Option under
the Hong Kong Underwriting Agreement. The Offer Size Adjustment Option provides
flexibility to increase the number of Offer Shares available for purchase under the Global
Offering to cover additional market demand, if any. The Offer Size Adjustment Option may be
exercised jointly by the Company and the Overall Coordinators prior to the execution of the
International Underwriting Agreement and will expire upon execution of the International
Underwriting Agreement.
Under the Offer Size Adjustment Option, the Company may issue any number of H Shares
up to an aggregate of 30,847,800 additional Offer Shares at the Offer Price. These Offer Size
Adjustment Option Shares, if any, will be allocated in such manner as closely as practicable
to maintain the proportionality between the Hong Kong Public Offering and the International
Offering following the application of the reallocation arrangement described in the subsection
headed “— The Hong Kong Public Offering — Reallocation” and the Sponsor-Overall
Coordinator shall allocate additional new H Shares to be offered by the Company pursuant to
the International Offering to the Hong Kong Public Offering in order to maintain such
proportionality and the relevant number of Offer Size Adjustment Option Shares shall be
allocated to the International Offering to maintain such proportionality.
If the Offer Size Adjustment Option is exercised in full, the Offer Size Adjustment Option
Shares to be issued pursuant thereto will represent approximately 1.6% of our issued share
capital immediately following the completion of the Global Offering (assuming the Over-
allotment Option is not exercised) and the exercise of the Offer Size Adjustment Option.
The dilution effect of the Offer Size Adjustment Option (assuming the Over-allotment
Option is not exercised) is set out below:
Number of H Shares
issued under the
Global Offering before
the exercise of the
Offer Size Adjustment
Option
Approximate
percentage of total
issued share capital of
the Offer Shares
initially offered before
the exercise of the
Offer Size Adjustment
Option
Number of H Shares
issued under the
Global Offering after
the full exercise of the
Offer Size Adjustment
Option
Approximate
percentage of total
issued share capital of
the Offer Shares
initially offered after
the full exercise of the
Offer Size Adjustment
Option
205,652,000 11.0% 236,499,800 12.4
The Offer Size Adjustment Option will not be used for price stabilisation purposes and
will not be subject to the provisions of the Securities and Futures (Price Stabilisation) Rules
(Chapter 571W of the Laws of Hong Kong). The Offer Size Adjustment Option will be in
addition to the Over-allotment Option.
STRUCTURE OF THE GLOBAL OFFERING
– 613 –


--- page 625 ---
The Company will disclose in its allotment results announcement if and to what extent the
Offer Size Adjustment Option has been exercised, or confirm that if the Offer Size Adjustment
Option has not been exercised prior to the execution of the International Underwriting
Agreement which is expected to be on or before Thursday, March 6, 2025, it will lapse and
cannot be exercised at any future date.
OVER-ALLOTMENT OPTION
In connection with the Global Offering, our Company is expected to grant the
Over-allotment Option to the International Underwriters, exercisable by the Overall
Coordinators (on behalf of the International Underwriters).
Pursuant to the Over-allotment Option, the International Underwriters will have the right,
exercisable by the Overall Coordinators (on behalf of the International Underwriters) at any
time from the Listing Date until 30 days after the last day for lodging applications under the
Hong Kong Public Offering, to require our Company to issue up to an aggregate of 30,847,800
additional H Shares, representing 15% of the total number of Offer Shares available under the
Global Offering assuming the Offer Size Adjustment Option is not exercised at all) or up to an
aggregate of 35,474,800 additional H Shares (representing approximately 15% of the total
number of Offer Shares being offered under the Global Offering assuming the Offer Size
Adjustment Option is exercised in full), at the Offer Price under the International Offering to
cover over-allocations in the International Offering, if any.
If the Offer Size Adjustment Option is not exercised and Over-allotment Option is
exercised in full, the additional Offer Shares to be issued pursuant to the Over-allotment Option
will represent approximately 1.6% of the enlarged issued share capital of our Company
immediately following the completion of the Global Offering. If the Offer Size Adjustment
Option and the Over-allotment Option are exercised in full, the additional Offer Shares will
represent approximately 1.8% of the total number of shares in issue immediately following
completion of the Global Offering and the exercise of the Over-allotment Option. We will make
an announcement if the Over-allotment Option is exercised.
OFFER SIZE
The allocation and the total number of Offer Shares under the Global Offering will be
determined in the following manner:
The allocation of Offer Shares between the International Offering and the Hong Kong
Public Offering will be subject to a reallocation adjustment depending on the number of Offer
Shares validly applied for under the Hong Kong Public Offering. See “— The Hong Kong
Public Offering — Reallocation” above for details.
STRUCTURE OF THE GLOBAL OFFERING
– 614 –


--- page 626 ---
If the Offer Size Adjustment Option is exercised in full, the additional Offer Shares made
available as a result, representing approximately 15% of the number of Offer Shares initially
being offered under the Global Offering, will be allocated so as to maintain the proportionality
between the Hong Kong Public Offering and the International Offering on a post-reallocation
basis. The Offer Size Adjustment Option will lapse if it is not exercised prior to the execution
of the International Underwriting Agreement. See “— Offer Size Adjustment Option” above for
details.
The number of Offer Shares to be made available under the International Offering may
be further increased if the Over-allotment Option is exercised. The maximum number of
additional International Offer Shares to be offered pursuant to the exercise of the
Over-allotment Option will represent approximately 15% of the number of Offer Shares being
offered under the Global Offering (including the Offer Shares offered pursuant to the exercise
of the Offer Size Adjustment Option, if any). See “— Over-allotment Option” above for details.
The table below sets out a summary of the total number of Hong Kong Offer Shares and
International Offer Shares being offered in the Global Offering under different scenarios,
depending on (a) whether a reallocation pursuant to the clawback arrangement described in “—
The Hong Kong Public Offering — Reallocation” above occurs and (b) whether any of the
Offer Size Adjustment Option and the Over-allotment Option is exercised at all and/or in full.
No clawback
reallocation
30% clawback
reallocation
40% clawback
reallocation
50% clawback
reallocation
Total number of Offer
Shares before the exercise
of the Offer Size
Adjustment Option and
the Over-allotment
Option /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
20,565,200
Hong Kong
Offer Shares
185,086,800
International
Offer Shares
61,695,600
Hong Kong
Offer Shares
143,956,400
International
Offer Shares
82,260,800
Hong Kong
Offer Shares
123,391,200
International
Offer Shares
102,826,000
Hong Kong
Offer Shares
102,826,000
International
Offer Shares
Total number of Offer
Shares following the full
exercise of the Offer Size
Adjustment Option only
(assuming the Over-
allotment Option is not
exercised) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
23,650,000
Hong Kong
Offer Shares
212,849,800
International
Offer Shares
70,950,000
Hong Kong
Offer Shares
165,549,800
International
Offer Shares
94,600,000
Hong Kong
Offer Shares
141,899,800
International
Offer Shares
118,250,000
Hong Kong
Offer Shares
118,249,800
International
Offer Shares
STRUCTURE OF THE GLOBAL OFFERING
– 615 –


--- page 627 ---
No clawback
reallocation
30% clawback
reallocation
40% clawback
reallocation
50% clawback
reallocation
Total number of Offer
Shares following the
exercise of the Over-
allotment Option
(assuming the Offer Size
Adjustment Option is not
exercised) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
20,565,200
Hong Kong
Offer Shares
215,934,600
International
Offer Shares
61,695,600
Hong Kong
Offer Shares
174,804,200
International
Offer Shares
82,260,800
Hong Kong
Offer Shares
154,239,000
International
Offer Shares
102,826,000
Hong Kong
Offer Shares
133,673,800
International
Offer Shares
Total number of Offer
Shares following the full
exercise of both the Offer
Size Adjustment Option
and the Over-allotment
Option /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
23,650,000
Hong Kong
Offer Shares
248,324,600
International
Offer Shares
70,950,000
Hong Kong
Offer Shares
201,024,600
International
Offer Shares
94,600,000
Hong Kong
Offer Shares
177,374,600
International
Offer Shares
118,250,000
Hong Kong
Offer Shares
153,724,600
International
Offer Shares
STABILIZATION
Stabilization is a practice used by underwriters in some markets to facilitate the
distribution of securities. To stabilize, the underwriters may bid for, or purchase, the securities
in the secondary market during a specified period of time, to retard and, if possible, prevent
a decline in the initial public market price of the securities below the offer price. Such
transactions may be effected in all jurisdictions where it is permissible to do so, in each case
in compliance with all applicable laws and regulatory requirements, including those of Hong
Kong. In Hong Kong, the price at which stabilization is effected is not permitted to exceed the
offer price.
In connection with the Global Offering, the Stabilizing Manager (or any person acting for
it), on behalf of the Underwriters, may over-allocate or effect transactions with a view to
stabilizing or supporting the market price of the H Shares at a level higher than that which
might otherwise prevail for a limited period after the Listing Date. However, there is no
obligation on the Stabilizing Manager (or any person acting for it) to conduct any such
stabilizing action. Such stabilizing action, if taken, (a) will be conducted at the absolute
discretion of the Stabilizing Manager (or any person acting for it) and in what the Stabilizing
Manager (or any person acting for it) reasonably regards as the best interest of our Company,
(b) may be discontinued at any time, and (c) is required to be brought to an end within 30 days
after the last day for lodging applications under the Hong Kong Public Offering.
STRUCTURE OF THE GLOBAL OFFERING
– 616 –


--- page 628 ---
Stabilization action permitted in Hong Kong pursuant to the Securities and Futures (Price
Stabilizing) Rules of the SFO includes (a) over-allocating for the purpose of preventing or
minimizing any reduction in the market price of the H Shares, (b) selling or agreeing to sell
the H Shares so as to establish a short position in them for the purpose of preventing or
minimizing any reduction in the market price of the H Shares, (c) purchasing, or agreeing to
purchase, the H Shares pursuant to the Offer Size Adjustment Option and the Over-allotment
Option in order to close out any position established under paragraph (a) or (b) above, (d)
purchasing, or agreeing to purchase, any of the H Shares for the sole purpose of preventing or
minimizing any reduction in the market price of the H Shares, (e) selling or agreeing to sell
any H Shares in order to liquidate any position established as a result of those purchases and
(f) offering or attempting to do anything as described in clauses (b), (c), (d) or (e) above.
Specifically, prospective applicants for and investors in the Offer Shares should note that:
 the Stabilizing Manager (or any person acting for it) may, in connection with the
stabilizing action, maintain a long position in the H Shares;
 there is no certainty as to the extent to which and the time or period for which the
Stabilizing Manager (or any person acting for it) will maintain such a long position;
 liquidation of any such long position by the Stabilizing Manager (or any person
acting for it) and selling in the open market may have an adverse impact on the
market price of the H Shares;
 no stabilizing action can be taken to support the price of the H Shares for longer than
the stabilization period, which will begin on the Listing Date, and is expected to
expire on Friday, April 4, 2025, being the 30th day after the last day for lodging
applications under the Hong Kong Public Offering. After this date, when no further
stabilizing action may be taken, demand for the H Shares, and therefore the price of
the H Shares, could fall;
 the price of the H Shares cannot be assured to stay at or above the Offer Price by
the taking of any stabilizing action; and
 stabilizing bids or transactions effected in the course of the stabilizing action may
be made at any price at or below the Offer Price and can, therefore, be done at a
price below the price paid by applicants for, or investors in, the Offer Shares.
In order to effect stabilization actions, the Stabilizing Manager may arrange cover of up
to an aggregate of 30,847,800 H Shares (representing up to 15% of the total number of Offer
Shares initially available under the Global Offering assuming the Offer Size Adjustment
Option is not exercised at all) or up to an aggregate of 35,474,800 H Shares (representing
approximately 15% of the total number of Offer Shares being offered under the Global Offering
assuming the Offer Size Adjustment Option is exercised in full), through delayed delivery
arrangements with investors who have been allocated Offer Shares in the International
STRUCTURE OF THE GLOBAL OFFERING
– 617 –


--- page 629 ---
Offering. The delayed delivery arrangements (if specifically agreed by an investor) relate only
to the delay in the delivery of the Offer Shares to such investor and the Offer Price for the Offer
Shares allocated to such investor will be fully paid before the Listing Date. Both the size of
such cover and the extent to which the Over-allotment Option can be exercised will depend on
whether arrangements can be made with investors such that a sufficient number of H Shares
can be delivered on a delayed basis. If no investor in the International Offering agrees to the
delayed delivery arrangements, no stabilizing actions will be undertaken by the Stabilizing
Manager and the Over-allotment Option will not be exercised.
Our Company will ensure that an announcement in compliance with the Securities and
Futures (Price Stabilizing) Rules of the SFO will be made within seven days of the expiration
of the stabilization period.
Over-allocation
Following any over-allocation of H Shares in connection with the Global Offering, the
Stabilizing Manager (or any person acting for it) may cover such over-allocations by, among
others, exercising the Offer Size Adjustment Option and the Over-allotment Option in full or
in part, using H Shares purchased by the Stabilizing Manager (or any person acting for it) in
the secondary market at prices that do not exceed the Offer Price or a combination of these
means.
PRICING AND ALLOCATION
Determining the Pricing of the Offer Price
Pricing for the Offer Shares for the purpose of the various offerings under the Global
Offering will be determined on the Price Determination Date, which is expected to be on or
before Thursday, March 6, 2025 and, in any event, no later than 12:00 noon on Thursday,
March 6, 2025, by agreement between the Overall Coordinators (for themselves and on behalf
of the Underwriters) and our Company, and the number of Offer Shares to be allocated under
the various offerings will be determined shortly thereafter.
The Offer Price will not be more than HK$15.83 per Offer Share and is expected to be
not less than HK$13.72 per Offer Share, unless otherwise announced, as further explained
below. Applicants under the Hong Kong Public Offering are required to pay, on application
(subject to application channel), the maximum Offer Price plus brokerage of 1.0%, SFC
transaction levy of 0.0027%, Stock Exchange trading fee of 0.00565% and AFRC transaction
levy of 0.00015%, amounting to a total of HK$3,197.93 for one board lot of 200 Offer Shares.
Prospective investors should be aware that the Offer Price to be determined on the Price
Determination Date may be, but is not expected to be, lower than the minimum Offer
Price stated in this document.
STRUCTURE OF THE GLOBAL OFFERING
– 618 –


--- page 630 ---
The International Underwriters will be soliciting from prospective investors’ indications
of interest in acquiring Offer Shares in the International Offering. Prospective professional and
institutional investors will be required to specify the number of Offer Shares under the
International Offering they would be prepared to acquire either at different prices or at a
particular price. This process, known as “book-building,” is expected to continue up to, and to
cease on or about, the last day for lodging applications under the Hong Kong Public Offering.
The Overall Coordinators (for itself and on behalf of the Underwriters) may, where they
deem appropriate, based on the level of interest expressed by prospective investors during the
book-building process in respect of the International Offering, and with the prior consent of our
Company, reduce the number of Offer Shares offered and/or the Offer Price range as stated in
this document at any time on or prior to the morning of the last day for lodging applications
under the Hong Kong Public Offering. In such a case, our Company will, as soon as practicable
following the decision to make such reduction, and in any event not later than the morning of
the last day for lodging applications under the Hong Kong Public Offering, cause to be
published on the websites of our Company and the Stock Exchange at cfgold.com and
www.hkexnews.hk , respectively, notices of the reduction. Our Company will also, as soon as
practicable following the decision to make such change, issue a supplemental prospectus
updating investors of the change in the number of Offer Shares being offered under the Global
Offering and/or the Offer Price. The Global Offering must first be canceled and subsequently
relaunched on FINI pursuant to the supplemental prospectus. Upon the issue of such a notice
and supplemental prospectus, the revised number of Offer Shares and/or the Offer Price range
will be final and conclusive and the Offer Price, if agreed upon by the Overall Coordinators
(for itself and on behalf of the Underwriters) and our Company, will be fixed within such
revised Offer Price range.
Before submitting applications for the Hong Kong Offer Shares, applicants should have
regard to the possibility that any announcement of a reduction in the number of Offer Shares
and/or Offer Price range may not be made until the last day for lodging applications under the
Hong Kong Public Offering. Such notice will also include confirmation or revision, as
appropriate, of the working capital statement and the Global Offering statistics as currently set
out in this document, and any other financial information which may change as a result of any
such reduction. In the absence of any such notice so published, the number of Offer Shares will
not be reduced and/or the Offer Price, if agreed upon by the Overall Coordinators (for itself and
on behalf of the Underwriters) and our Company, will under no circumstances be set outside
the Offer Price range as stated in this document.
Announcement of Offer Price
The final Offer Price, the level of indications of interest in the International Offering, the
level of applications in the Hong Kong Public Offering, the basis of allocations of the Hong
Kong Offer Shares and the results of allocations in the Hong Kong Public Offering are
expected to be made available through a variety of channels in the manner described in the
section headed “How to Apply for Hong Kong Offer Shares — B. Publication of Results.”
STRUCTURE OF THE GLOBAL OFFERING
– 619 –


--- page 631 ---
UNDERWRITING
The Hong Kong Public Offering is fully underwritten by the Hong Kong Underwriters
under the terms and conditions of the Hong Kong Underwriting Agreement and is subject to
the Overall Coordinators (for itself and on behalf of the Underwriters) and our Company
agreeing on the Offer Price.
Our Company expects to enter into the International Underwriting Agreement relating to
the International Offering on or around the Price Determination Date.
These underwriting arrangements, including the Underwriting Agreements, are
summarized in the section headed “Underwriting” in this Prospectus.
CONDITIONS OF THE GLOBAL OFFERING
Acceptance of all applications for Offer Shares will be conditional on:
(a) the Stock Exchange granting approval for the listing of, and permission to deal in,
the H Shares to be issued pursuant to the Global Offering on the Main Board of the
Stock Exchange (including any H Shares that may be issued pursuant to the exercise
of the Offer Size Adjustment Option and the Over-allotment Option) and such
approval and permission not subsequently having been withdrawn or revoked prior
to the Listing Date;
(b) the Offering;
(c) the execution and delivery of the International Underwriting Agreement on or
around the Price Determination Date; and
(d) the obligations of the Hong Kong Underwriters under the Hong Kong Underwriting
Agreement and the obligations of the International Underwriters under the
International Underwriting Agreement becoming and remaining unconditional and
not having been terminated in accordance with the terms of the respective
agreements,
in each case on or before the dates and times specified in the respective Underwriting
Agreements (unless and to the extent such conditions are validly waived on or before such
dates and times) and, in any event, not later than the date which is 30 days after the date of
this Prospectus.
The consummation of each of the Hong Kong Public Offering and the International
Offering is conditional upon, among other things, the other offering becoming unconditional
and not having been terminated in accordance with its terms.
STRUCTURE OF THE GLOBAL OFFERING
– 620 –


--- page 632 ---
If the above conditions are not fulfilled or waived prior to the dates and times specified,
the Global Offering will lapse and the Stock Exchange will be notified immediately. Notice of
the lapse of the Hong Kong Public Offering will be published by our Company on the websites
of our Company and the Stock Exchange at cfgold.com and www.hkexnews.hk , respectively,
on the next day following such lapse. In such a situation, all application monies will be
returned, without interest, on the terms set out in the section headed “How to Apply for Hong
Kong Offer Shares — (F) Refund of Application Monies” in this Prospectus. In the meantime,
all application monies will be held in separate bank account(s) with the receiving banks or
other bank(s) in Hong Kong licensed under the Banking Ordinance (Chapter 155 of the Laws
of Hong Kong).
H Share certificates for the Offer Shares will only become valid evidence of title at 8:00
a.m. on Monday, March 10, 2025, provided that the Global Offering has become unconditional
in all respects at or before that time.
DEALINGS IN THE H SHARES
Assuming that the Hong Kong Public Offering becomes unconditional at or before 8:00
a.m. in Hong Kong on Monday, March 10, 2025, it is expected that dealings in the H Shares
on the Stock Exchange will commence at 9:00 a.m. on Monday, March 10, 2025.
The H Shares will be traded in board lots of 200 H Shares each and the stock code of the
H Shares will be 6693.
STRUCTURE OF THE GLOBAL OFFERING
– 621 –


--- page 633 ---
IMPORTANT NOTICE TO INVESTORS OF HONG KONG OFFER SHARES
FULLY ELECTRONIC APPLICATION PROCESS
We have adopted a fully electronic application process for the Hong Kong
Public Offering and below are the procedures for application.
This Prospectus is available at the website of the Stock Exchange at
www.hkexnews.hk under the “HKEXnews > New Listings > New Listing
Information” section, and our website at cfgold.com.
The contents of this Prospectus are identical to the prospectus as registered with the
Registrar of Companies in Hong Kong pursuant to Section 342C of the Companies
(Winding Up and Miscellaneous Provisions) Ordinance.
A. APPLICATION FOR HONG KONG OFFER SHARES
1. Who Can Apply
Y ou can apply for Hong Kong Offer Shares if you or the person(s) for whose benefit you
are applying for:
 are 18 years of age or older;
 have a Hong Kong address (for the White Form eIPO service only); and
 are outside the United States (within the meaning of Regulation S) or are a person
described in paragraph (h)(3) of Rule 902 of Regulation S.
Unless permitted by the Listing Rules or a waiver and/or consent has been granted by the
Stock Exchange to us, you cannot apply for any Hong Kong Offer Shares if you or the
person(s) for whose benefit you are applying for:
 are an existing Shareholder of our Company;
 are a Director, Supervisor or chief executive of our Company and/or a director,
supervisor or chief executive of any of its subsidiaries;
 are a close associate (as defined in the Listing Rules) of any of the above persons;
 are a connected person (as defined in the Listing Rules) of our Company or will
become a connected person of our Company immediately upon the completion of the
Global Offering; or
 have been allocated or have applied for or indicated an interest in any International
Offer Shares or otherwise participate in the International Offering.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 622 –


--- page 634 ---
2. Application Channels
The Hong Kong Public Offering period will begin at 9:00 a.m. on Friday, February
28, 2025 and end at 12:00 noon on Wednesday, March 5, 2025 (Hong Kong time).
To apply for Hong Kong Offer Shares, you may use one of the following application
channels:
Application Channel Platform Target Investors Application Time
White Form
eIPO service /H1118/H1118
www.eipo.com.hk Investors who would
like to receive a
physical H Share
certificate. Hong
Kong Offer Shares
successfully applied
for will be allotted
and issued in your
own name.
From 9:00 a.m. on
Friday, February
28, 2025 to 11:30
a.m. on
Wednesday,
March 5, 2025,
Hong Kong time.
The latest time
for completing
full payment of
application
monies will be
12:00 noon on
Wednesday,
March 5, 2025,
Hong Kong time.
HKSCC EIPO
channel /H1118/H1118/H1118/H1118/H1118/H1118
Y our broker or
custodian who is
a HKSCC
Participant will
submit electronic
application
instructions on
your behalf
through HKSCC’s
FINI system in
accordance with
your instruction
Investors who would
not like to receive a
physical H Share
certificate. Hong
Kong Offer Shares
successfully applied
for will be allotted
and issued in the
name of HKSCC
Nominees, deposited
directly into CCASS
and credited to your
designated HKSCC
Participant’s stock
account.
Contact your broker
or custodian for
the earliest and
latest time for
giving such
instructions, as
this may vary by
broker or
custodian.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 623 –


--- page 635 ---
The White Form eIPO service and the HKSCC EIPO channel are facilities subject to
capacity limitations and potential service interruptions, and you are advised not to wait until
the last day of the application period to apply for Hong Kong Offer Shares.
For those applying through the White Form eIPO service, once you complete payment
in respect of any application instructions given by you or for your benefit through the White
Form eIPO service to make an application for Hong Kong Offer Shares, an actual application
shall be deemed to have been made. If you are a person for whose benefit the electronic
application instructions are given, you shall be deemed to have declared that only one set of
electronic application instructions has been given for your benefit. If you are an agent for
another person, you shall be deemed to have declared that you have only given one set of
electronic application instructions for the benefit of the person for whom you are an agent
and that you are duly authorized to give those instructions as an agent.
For the avoidance of doubt, giving an application instruction under the White Form eIPO
service more than once and obtaining different payment reference numbers without effecting
full payment in respect of a particular reference number will not constitute an actual
application.
If you apply through the White Form eIPO service, you are deemed to have authorized
the White Form eIPO service provider to apply on the terms and conditions in this prospectus,
as supplemented and amended by the terms and conditions of the White Form eIPO service.
By instructing your broker or custodian to apply for the Hong Kong Offer Shares on your
behalf through the HKSCC EIPO Channel, you (and, if you are joint applicants, each of you
jointly and severally) are deemed to have instructed and authorized HKSCC to cause HKSCC
Nominees (acting as nominee for the relevant HKSCC Participants) to apply for Hong Kong
Offer Shares on your behalf and to do on your behalf all the things stated in this Prospectus
and any supplement to it.
For those applying through HKSCC EIPO channel, an actual application will be deemed
to have been made for any application instructions given by you or for your benefit to HKSCC
(in which case an application will be made by HKSCC Nominees on your behalf) provided such
application instruction has not been withdrawn or otherwise invalidated before the closing time
of the Hong Kong Public Offering.
HKSCC Nominees will only be acting as a nominee for you and neither HKSCC nor
HKSCC Nominees shall be liable to you or any other person in respect of any actions taken by
HKSCC or HKSCC Nominees on your behalf to apply for Hong Kong Offer Shares or for any
breach of the terms and conditions of this Prospectus.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 624 –


--- page 636 ---
3. Information Required to Apply
Y ou must provide the following information with your application:
For Individual or Joint Applicants For Corporate Applicants
 Full name(s) (2) as shown on your
identity document
 Identity document’s issuing country
or jurisdiction
 Identity document type, with order
of priority:
i. HKID card; or
ii. National identification
document; or
iii. Passport; and
 Identity document number
 Full name(s)
(2) as shown on your
identity document
 Identity document’s issuing country
or jurisdiction
 Identity document type, with order
of priority:
i. LEI registration document; or
ii. Certificate of incorporation; or
iii. Business registration
certificate; or
iv. Other equivalent document; and
 Identity document number
Notes:
(1) If you are applying through the White Form eIPO service, you are required to provide a valid e-mail
address, a contact telephone number and a Hong Kong address. Y ou are also required to declare that the
identity information provided by you follows the requirements as described in Note 2 below. In
particular, where you cannot provide a HKID number, you must confirm that you do not hold a HKID
card.
(2) The applicant’s full name as shown on their identity document must be used. If an applicant’s identity
document contains both an English and Chinese name, both English and Chinese names must be used.
Otherwise, either English or Chinese names will be accepted. The order of priority of the applicant’s
identity document type must be strictly followed and where an individual applicant has a valid HKID
card, the HKID number must be used when making an application to subscribe for Hong Kong Offer
Shares. Similarly for corporate applicants, a LEI number must be used if an entity has a LEI certificate.
(3) If the applicant is a trustee, the client identification data (“ CID”) of the trustee, as set out above, will
be required. If the applicant is an investment fund (i.e. a collective investment scheme, or CIS), the CID
of the asset management company or the individual fund, as appropriate, which has opened a trading
account with the broker will be required, as above.
(4) The maximum number of joint applicants on FINI is capped at 4 in accordance with market practice.
The maximum number is subject to change, if our Company’s Articles of Incorporation and applicable
company law prescribe a lower cap.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 625 –


--- page 637 ---
(5) If you are applying as a nominee, you must provide: (i) the full name (as shown on the identity
document), the identity document’s issuing country or jurisdiction, the identity document type; and (ii),
the identity document number, for each of the beneficial owners or, in the case(s) of joint beneficial
owners, for each joint beneficial owner. If you do not include this information, the application will be
treated as being made for your benefit.
If you are applying as an unlisted company and (i) the principal business of that company is dealing in
securities; and (ii) you exercise statutory control over that company, then the application will be treated
as being for your benefit and you should provide the required information in your application as stated
above.
“Unlisted company” means a company with no equity securities listed on the Stock Exchange or any
other stock exchange.
“Statutory control” means you:
 control the composition of the board of directors of the company;
 control more than half of the voting power of the company; or
 hold more than half of the issued share capital of the company (not counting any part of it which
carries no right to participate beyond a specified amount in a distribution of either profits or
capital).
For those applying through HKSCC EIPO channel, and making an application under a
power of attorney, we and the Overall Coordinators, as our agent, have discretion to consider
whether to accept it on any conditions we think fit, including evidence of the attorney’s
authority.
Failing to provide any required information may result in your application being rejected.
4. Permitted Number of Hong Kong Offer Shares for Application
Board lot size /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118: 200 H Shares
Permitted number of
Hong Kong Offer
Shares for application
and amount payable on
application/successful
allotment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
: Hong Kong Offer Shares are available for application
in specified board lot sizes only. Please refer to the
amount payable associated with each specified board
lot size in the table below.
The maximum Offer Price is HK$15.83 per H Share.
If you are applying through the HKSCC EIPO
channel, you are required to pre-fund your
application based on the amount specified by your
broker or custodian, as determined based on the
applicable laws and regulations in Hong Kong.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 626 –


--- page 638 ---
By instructing your broker or custodian to apply for
the Hong Kong Offer Shares on your behalf through
the HKSCC EIPO channel, you (and, if you are joint
applicants, each of you jointly and severally) are
deemed to have instructed and authorized HKSCC to
cause HKSCC Nominees (acting as nominee for the
relevant HKSCC Participants) to arrange payment of
the Offer Price, brokerage, SFC transaction levy, the
Stock Exchange trading fee and the AFRC transaction
levy by debiting the relevant nominee bank account
at the Designated Bank for your broker or custodian.
If you are applying through the White Form eIPO
service, you may refer to the table below for the
amount payable for the number of H Shares you have
selected. Y ou must pay the respective maximum
amount payable on application in full upon
application for Hong Kong Offer Shares.
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application
HK$ HK$ HK$ HK$
200 3,197.93 4,000 63,958.58 60,000 959,378.72 2,000,000 31,979,291.10
400 6,395.86 5,000 79,948.23 70,000 1,119,275.19 2,500,000 39,974,113.88
600 9,593.79 6,000 95,937.87 80,000 1,279,171.64 3,000,000 47,968,936.66
800 12,791.72 7,000 111,927.52 90,000 1,439,068.11 3,500,000 55,963,759.43
1,000 15,989.64 8,000 127,917.17 100,000 1,598,964.55 4,000,000 63,958,582.20
1,200 19,187.57 9,000 143,906.81 200,000 3,197,929.11 4,500,000 71,953,404.98
1,400 22,385.50 10,000 159,896.45 300,000 4,796,893.66 5,000,000 79,948,227.76
1,600 25,583.43 20,000 319,792.91 400,000 6,395,858.22 6,000,000 95,937,873.30
1,800 28,781.36 30,000 479,689.36 500,000 7,994,822.78 7,000,000 111,927,518.86
2,000 31,979.29 40,000 639,585.83 1,000,000 15,989,645.56 8,000,000 127,917,164.40
3,000 47,968.93 50,000 799,482.28 1,500,000 23,984,468.33 10,282,600
(1) 164,415,129.34
(1) Maximum number of Hong Kong Offer Share you may apply for.
(2) The amount payable is inclusive of brokerage, SFC transaction levy, the Stock Exchange trading fee and AFRC
transaction levy. If your application is successful, brokerage will be paid to the Exchange Participants (as
defined in the Listing Rules) and the SFC transaction levy, the Stock Exchange trading fee and AFRC
transaction levy are paid to the Stock Exchange (in the case of the SFC transaction levy, collected by the Stock
Exchange on behalf of the SFC; and in the case of the AFRC transaction levy, collected by the Stock Exchange
on behalf of the AFRC).
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 627 –


--- page 639 ---
5. Multiple Applications Prohibited
Y ou or your joint applicant(s) shall not make more than one application for your own
benefit, except where you are a nominee and provide the information of the underlying investor
in your application as required under the paragraph headed “— A. Applications for Hong Kong
Offer Shares — 3. Information Required to Apply” in this section. If you are suspected of
submitting or cause to submit more than one application, all of your applications will be
rejected.
Multiple applications made either through (i) the White Form eIPO service, (ii) HKSCC
EIPO channel, or (iii) both channels concurrently are prohibited and will be rejected. If you
have made an application through the White Form eIPO service or HKSCC EIPO channel,
you or the person(s) for whose benefit you have made the application shall not apply for any
International Offer Shares.
6. Terms and Conditions of An Application
By applying for Hong Kong Offer Shares through the White Form eIPO service or
HKSCC EIPO channel, you (or as the case may be, HKSCC Nominees will do the following
things on your behalf):
(i) undertake to execute all relevant documents and instruct and authorise us and/or the
Overall Coordinators, as our agents, to execute any documents for you and to do on
your behalf all things necessary to register any Hong Kong Offer Shares allocated
to you in your name or in the name of HKSCC Nominees as required by the Articles
of Association, and (if you are applying through the HKSCC EIPO channel) to
deposit the allotted Hong Kong Offer Shares directly into CCASS for the credit of
your designated HKSCC Participant’s stock account on your behalf;
(ii) confirm that you have read and understand the terms and conditions and application
procedures set out in this Prospectus and the designated website of the White Form
eIPO service (or as the case may be, the agreement you entered into with your
broker or custodian), and agree to be bound by them;
(iii) (if you are applying through the HKSCC EIPO channel) agree to the arrangements,
undertakings and warranties under the participant agreement between your broker or
custodian and HKSCC and observe the General Rules of HKSCC and the HKSCC
Operational Procedures for giving application instructions to apply for Hong Kong
Offer Shares;
(iv) confirm that you are aware of the restrictions on offers and sales of shares set out
in this Prospectus and they do not apply to you, or the person(s) for whose benefit
you have made the application;
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 628 –


--- page 640 ---
(v) confirm that you have read this Prospectus and any supplement to it and have relied
only on the information and representations contained therein in making your
application (or as the case may be, causing your application to be made) and will not
rely on any other information or representations;
(vi) agree that the Relevant Persons, the H Share Registrar and HKSCC will not be liable
for any information and representations not in this Prospectus and any supplement
to it;
(vii) agree to disclose the details of your application and your personal data and any other
personal data which may be required about you and the person(s) for whose benefit
you have made the application to us, the Relevant Persons, the H Share Registrar,
HKSCC, HKSCC Nominees, the Stock Exchange, the SFC and any other statutory
regulatory or governmental bodies or otherwise as required by laws, rules or
regulations, for the purposes under the paragraph headed “— G. Personal Data —
3. Purposes and 4. Transfer of personal data” in this section;
(viii) agree (without prejudice to any other rights which you may have once your
application (or as the case may be, HKSCC Nominees’ application) has been
accepted) that you will not rescind it because of an innocent misrepresentation;
(ix) agree that subject to Section 44A(6) of the Companies (Winding Up and
Miscellaneous Provisions) Ordinance, any application made by you or HKSCC
Nominees on your behalf cannot be revoked once it is accepted, which will be
evidenced by the notification of the result of the ballot by the H Share Registrar by
way of publication of the results at the time and in the manner as specified in the
paragraph headed “— B. Publication of Results” in this section;
(x) confirm that you are aware of the situations specified in the paragraph headed “—
C. Circumstances In Which Y ou Will Not Be Allocated Hong Kong Offer Shares” in
this section;
(xi) agree that your application or HKSCC Nominees’ application, any acceptance of it
and the resulting contract will be governed by and construed in accordance with the
laws of Hong Kong;
(xii) agree to comply with the Companies Ordinance, the Companies (Winding Up and
Miscellaneous Provisions) Ordinance, the Articles of Association and laws of any
place outside Hong Kong that apply to your application and that neither we nor the
Relevant Persons will breach any law inside and/or outside Hong Kong as a result
of the acceptance of your offer to purchase, or any action arising from your rights
and obligations under the terms and conditions contained in this Prospectus;
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 629 –


--- page 641 ---
(xiii) confirm that (a) your application or HKSCC Nominees’ application on your behalf
is not financed directly or indirectly by our Company, any of the directors, chief
executives, substantial shareholder(s) or existing Shareholder(s) of our Company or
any of its subsidiaries or any of their respective close associates; and (b) you are not
accustomed or will not be accustomed to taking instructions from our Company, any
of the Directors, chief executives, substantial shareholder(s) or existing
Shareholder(s) of our Company or any of its subsidiaries or any of their respective
close associates in relation to the acquisition, disposal, voting or other disposition
of the H Shares registered in your name or otherwise held by you;
(xiv) warrant that the information you have provided is true and accurate;
(xv) confirm that you understand that we and the Overall Coordinators will rely on your
declarations and representations in deciding whether or not to allocate any Hong
Kong Offer Shares to you and that you may be prosecuted for making a false
declaration;
(xvi) agree to accept Hong Kong Offer Shares applied for or any lesser number allocated
to you under the application;
(xvii) declare and represent that this is the only application made and the only application
intended by you to be made to benefit you or the person for whose benefit you are
applying;
(xviii) (if the application is made for your own benefit) warrant that no other application
has been or will be made for your benefit by giving electronic application
instructions to HKSCC directly or indirectly or through the White Form eIPO
service or by any one as your agent or by any other person; and
(xix) (if you are making the application as an agent for the benefit of another person)
warrant that; (a) no other application has been or will be made by you as agent for
or for the benefit of that person or by that person or by any other person as agent
for that person by giving electronic application instructions to HKSCC; and (b)
you have due authority to give electronic application instructions on behalf of that
other person as its agent.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 630 –


--- page 642 ---
B. PUBLICATION OF RESULTS
1. Results of Allocation
Y ou can check whether you are successfully allocated any Hong Kong Offer Shares
through:
Platform Date/Time
Applying through White Form eIPO service or HKSCC EIPO channel:
Website /H1118/H1118/H1118/H1118/H1118The designated results of allocation at
www.iporesults.com.hk (alternatively:
www.eipo.com.hk/eIPOAllotment ) with
a “search by ID Number” function.
24 hours, from 11:00
p.m. on Friday,
March 7, 2025 to
12:00 midnight on
Thursday, March 13,
2025.
The full list of (i) wholly or partially
successful applicants using the White
Form eIPO service and HKSCC EIPO
channel, and (ii) the number of Hong
Kong Offer Shares conditionally allotted
to them, among other things, will be
displayed on the “Allotment Results”
page of the White Form eIPO service at
www.iporesults.com.hk (alternatively:
www.eipo.com.hk/eIPOAllotment ).
The Stock Exchange’s website at
www.hkexnews.hk and our website at
cfgold.com which will provide links to
the above mentioned websites of the H
Share Registrar.
No later than 11:00
p.m. on Friday,
March 7, 2025
(Hong Kong time).
Telephone /H1118/H1118/H1118+852 2862 8555 – the allocation results
telephone enquiry line provided by the H
Share Registrar.
between 9:00 a.m. and
6:00 p.m., from
Monday, March 10,
2025 to Thursday,
March 13, 2025
(Hong Kong time)
on a business day.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 631 –


--- page 643 ---
For those applying through HKSCC EIPO channel, you may also check with your broker
or custodian from 6:00 p.m. on Thursday, March 6, 2025 (Hong Kong time).
HKSCC Participants can log into FINI and review the allotment result from 6:00 p.m. on
Thursday, March 6, 2025 (Hong Kong time) on a 24-hour basis and should report any
discrepancies on allotments to HKSCC as soon as practicable.
2. Allocation Announcement
We expect to announce the results of the final Offer Price, the level of indications of
interest in the International Offering, the level of applications in the Hong Kong Public
Offering and the basis of allocations of Hong Kong Offer Shares on the Stock Exchange’s
website at www.hkexnews.hk and our website at cfgold.com by no later than 11:00 p.m. on
Friday, March 7, 2025 (Hong Kong time).
C. CIRCUMSTANCES IN WHICH YOU WILL NOT BE ALLOCATED HONG KONG
OFFER SHARES
Y ou should note the following situations in which Hong Kong Offer Shares will not be
allocated to you or the person(s) for whose benefit you are applying for:
1. If your application is revoked:
Y our application or the application made by HKSCC Nominees on your behalf may be
revoked pursuant to Section 44A(6) of the Companies (Winding Up and Miscellaneous
Provisions) Ordinance.
2. If we or our agents exercise our discretion to reject your application:
We, the Overall Coordinators, the H Share Registrar and their respective agents and
nominees have full discretion to reject or accept any application, or to accept only part of any
application, without giving any reasons.
3. If the allocation of Hong Kong Offer Shares is void:
The allocation of Hong Kong Offer Shares will be void if the Stock Exchange does not
grant permission to list our H Shares either:
 within three weeks from the closing date of the applications lists; or
 within a longer period of up to six weeks if the Stock Exchange notifies us of that
longer period within three weeks of the closing date of the application lists.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 632 –


--- page 644 ---
4. If:
 you make multiple applications or suspected multiple applications. Y ou may refer to
the paragraph headed “— A. Applications for Hong Kong Offer Shares — 5.
Multiple Applications Prohibited” in this section on what constitutes multiple
applications;
 your application instruction is incomplete;
 your payment (or confirmation of funds, as the case may be) is not made correctly;
 the Underwriting Agreements do not become unconditional or are terminated; or
 we or the Overall Coordinators believe that by accepting your application, it or we
would violate applicable securities or other laws, rules or regulations.
5. If there is money settlement failure for allotted H Shares:
Based on the arrangements between HKSCC Participants and HKSCC, HKSCC
Participants will be required to hold sufficient application funds on deposit with their
Designated Bank before balloting. After balloting of Hong Kong Offer Shares, the Receiving
Bank will collect the portion of these funds required to settle each HKSCC Participant’s actual
Hong Kong Offer Share allotment from their Designated Bank.
There is a risk of money settlement failure. In the extreme event of money settlement
failure by a HKSCC Participant (or its Designated Bank), who is acting on your behalf in
settling payment for your allotted shares, HKSCC will contact the defaulting HKSCC
Participant and its Designated Bank to determine the cause of failure and request such
defaulting HKSCC Participant to rectify or procure to rectify the failure.
However, if it is determined that such settlement obligation cannot be met, the affected
Hong Kong Offer Shares will be reallocated to the International Offering. Hong Kong Offer
Shares applied for by you through the broker or custodian may be affected to the extent of the
settlement failure. In the extreme case, you will not be allocated any Hong Kong Offer Shares
due to the money settlement failure by such HKSCC Participant. None of us, the Relevant
Persons, the H Share Registrar and HKSCC is or will be liable if Hong Kong Offer Shares are
not allocated to you due to the money settlement failure.
D. DESPATCH/COLLECTION OF H SHARE CERTIFICATES AND REFUND OF
APPLICATION MONIES
Y ou will receive one H Share certificate for all Hong Kong Offer Shares allotted to you
under the Hong Kong Public Offering (except pursuant to applications made through the
HKSCC EIPO channel where the H Share certificates will be deposited into CCASS as
described below).
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 633 –


--- page 645 ---
No temporary document of title will be issued in respect of the H Shares. No receipt will
be issued for sums paid on application.
H Share certificates will only become valid evidence of title at 8:00 a.m. on Monday,
March 10, 2025 (Hong Kong time), provided that the Global Offer has become unconditional
and the right of termination described in the section headed “Underwriting” has not been
exercised. Investors who trade H Shares prior to the receipt of H Share certificates or the H
Share certificates becoming valid do so entirely at their own risk.
The right is reserved to retain any H Share certificate(s) and (if applicable) any surplus
application monies pending clearance of application monies.
The following sets out the relevant procedures and time:
White Form eIPO service HKSCC EIPO channel
Despatch/collection of H
Share certificate 1
For physical share
certificates of 1,000,000
or more Hong Kong
Offer Shares issued
under your own name /H1118/H1118
Collection in person
from H Share Registrar,
Computershare
Hong Kong Investor
Services Limited at
Shops 1712-1716, 17th
Floor, Hopewell Centre,
183 Queen’s Road East,
Wan Chai, Hong Kong.
H Share certificate(s) will
be issued in the name of
HKSCC Nominees,
deposited into CCASS
and credited to your
designated HKSCC
Participant’s stock
account.
Time: from 9:00 a.m.
to 1:00 p.m. on Monday,
March 10, 2025.
No action by you is
required.
If you are an individual,
you must not authorise
any other person to
collect for you. If you
are a corporate applicant,
your authorised
representative must bear
a letter of authorization
from your corporation
stamped with your
corporation’s chop.
1 Except in the event of a tropical cyclone warning signal number 8 or above, a black rainstorm warning and/or
an Extreme Conditions announcement in force in Hong Kong in the morning on Friday, 7 March 2025,
rendering it impossible for the relevant share certificates to be dispatched to HKSCC in a timely manner, the
Company shall procure the H Share Registrar to arrange for delivery of the supporting documents and H Share
certificates in accordance with the contingency arrangements as agreed between them. Please refer t o“–E .
Severe Weather Arrangements” in this section.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 634 –


--- page 646 ---
White Form eIPO service HKSCC EIPO channel
Both individuals and
authorised representatives
must produce, at the time
of collection, evidence of
identity acceptable to the
H Share Registrar.
Note: If you do not collect
your H Share
certificate(s) personally
within the time above,
it/they will be sent to the
address specified in your
application instructions
by ordinary post at your
own risk.
For physical share
certificates of 1,000,000
or more Hong Kong
Offer Shares issued
under your own name /H1118/H1118
Y our H Share certificate(s)
will be sent to the
address specified in your
application instructions
by ordinary post at your
own risk.
Time: Friday,
March 7, 2025
Refund mechanism for surplus application monies paid by you
Date /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Monday,
March 10, 2025
Subject to the arrangement
between you and your
broker or custodian.
Responsible party /H1118/H1118/H1118/H1118/H1118/H1118/H1118H Share Registrar Y our broker or custodian
Application monies paid
through single bank
account /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
White Form e-Refund
payment instructions to
your designated bank
account.
Y our broker or custodian
will arrange refund to
your designated bank
account subject to the
arrangement between you
and it.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 635 –


--- page 647 ---
White Form eIPO service HKSCC EIPO channel
Application monies paid
through multiple bank
accounts /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Refund cheque(s) will be
despatched to the address
as specified in your
application instructions
by ordinary post at your
own risk
E. SEVERE WEATHER ARRANGEMENTS
1. The Opening and Closing of the Application Lists
The application lists will not open or close on Wednesday, March 5, 2025 if, there is/are:
 a tropical cyclone warning signal number 8 or above;
 a black rainstorm warning; and/or
 Extreme Conditions,
(collectively, “ Severe Weather Signals ”),
in force in Hong Kong at any time between 9:00 a.m. and 12:00 noon on Wednesday, March 5,
2025.
Instead they will open between 11:45 a.m. and 12:00 noon and/or close at 12:00 noon on
the next business day which does not have Severe Weather Signals in force at any time between
9:00 a.m. and 12:00 noon.
Prospective investors should be aware that a postponement of the opening/closing of the
application lists may result in a delay in the Listing Date. Should there be any changes to the
dates mentioned in the section headed “Expected Timetable” in this Prospectus, an
announcement will be made and published on the Stock Exchange’s website at
www.hkexnews.hk and our website at cfgold.com of the revised timetable.
If a Severe Weather Signal is hoisted on Friday, March 7, 2025 the H Share Registrar will
make appropriate arrangements for the delivery of the H Share certificates to the CCASS
Depository’s service counter so that they would be available for trading on Monday, March 10,
2025.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 636 –


--- page 648 ---
If a Severe Weather Signal is hoisted on Friday, March 7, 2025:
 for physical H share certificates of 1,000,000 or more Offer Shares issued under
your own name, you may pick them up from the H Share Registrar’s office after the
Severe Weather Signal is lowered or cancelled (e.g. in the afternoon of Friday,
March 7, 2025 or on Monday, March 10, 2025).
If a Severe Weather Signal is hoisted on Monday, March 10, 2025:
 for physical H share certificates of less than 1,000,000 Offer Shares issued under
your own name, despatch will be made by ordinary post when the post office
re-opens after the Severe Weather Signal is lowered or cancelled (e.g. in the
afternoon of Monday, March 10, 2025 or on Tuesday, March 11, 2025).
Prospective investors should be aware that if they choose to receive physical H Share
certificates issued in their own name, there may be a delay in receiving the H Share
certificates.
F. ADMISSION OF THE H SHARES INTO CCASS
If the Stock Exchange grants the listing of, and permission to deal in, the H Shares on the
Stock Exchange and we comply with the stock admission requirements of HKSCC, the H
Shares will be accepted as eligible securities by HKSCC for deposit, clearance and settlement
in CCASS with effect from the date of commencement of dealings in the H Shares or any other
date HKSCC chooses. Settlement of transactions between Exchange Participants is required to
take place in CCASS on the second settlement day after any trading day.
All activities under CCASS are subject to the General Rules of HKSCC and HKSCC
Operational Procedures in effect from time to time.
All necessary arrangements have been made enabling the H Shares to be admitted into
CCASS.
Y ou should seek the advice of your broker or other professional advisor for details of the
settlement arrangement as such arrangements may affect your rights and interests.
G. PERSONAL DATA
The following Personal Information Collection Statement applies to any personal data
collected and held by our Company, the H Share Registrar, the receiving bank and the Relevant
Persons about you in the same way as it applies to personal data about applicants other than
HKSCC Nominees. This personal data may include client identifier(s) and your identification
information. By giving application instructions to HKSCC, you acknowledge that you have
read, understood and agree to all of the terms of the Personal Information Collection Statement
below.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 637 –


--- page 649 ---
1. Personal Information Collection Statement
This Personal Information Collection Statement informs the applicant for, and holder of,
Hong Kong Offer Shares, of the policies and practices of our Company and the H Share
Registrar in relation to personal data and the Personal Data (Privacy) Ordinance (Chapter 486
of the Laws of Hong Kong).
2. Reasons for the collection of your personal data
It is necessary for applicants and registered holders of Hong Kong Offer Shares to ensure
that personal data supplied to our Company or its agents and the H Share Registrar is accurate
and up-to-date when applying for Hong Kong Offer Shares or transferring Hong Kong Offer
Shares into or out of their names or in procuring the services of the H Share Registrar.
Failure to supply the requested data or supplying inaccurate data may result in your
application for Hong Kong Offer Shares being rejected, or in the delay or the inability of our
Company or the H Share Registrar to effect transfers or otherwise render their services. It may
also prevent or delay registration or transfers of Hong Kong Offer Shares which you have
successfully applied for and/or the despatch of H Share certificate(s) to which you are entitled.
It is important that applicants for and holders of Hong Kong Offer Shares inform our
Company and the H Share Registrar immediately of any inaccuracies in the personal data
supplied.
3. Purposes
Y our personal data may be used, held, processed, and/or stored (by whatever means) for
the following purposes:
 processing your application and refund cheque and White Form e-Refund payment
instructions payment instruction(s), where applicable, verification of compliance
with the terms and application procedures set out in this Prospectus and announcing
results of allocation of Hong Kong Offer Shares;
 compliance with applicable laws and regulations in Hong Kong and elsewhere;
 registering new issues or transfers into or out of the names of the holders of the H
Shares including, where applicable, HKSCC Nominees;
 maintaining or updating the register of members of our Company;
 verifying identities of applicants for and holders of the H Shares and identifying any
duplicate applications for the H Shares;
 facilitating Hong Kong Offer Shares balloting;
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 638 –


--- page 650 ---
 establishing benefit entitlements of holders of the H Shares, such as dividends,
rights issues, bonus issues, etc.;
 distributing communications from our Company and its subsidiaries;
 compiling statistical information and profiles of the holder of the H Shares;
 disclosing relevant information to facilitate claims on entitlements; and
 any other incidental or associated purposes relating to the above and/or to enable our
Company and the H Share Registrar to discharge their obligations to applicants and
holders of the H Shares and/or regulators and/or any other purposes to which
applicants and holders of the H Shares may from time to time agree.
4. Transfer of personal data
Personal data held by our Company and the H Share Registrar relating to the applicants
for and holders of Hong Kong Offer Shares will be kept confidential, but our Company and the
H Share Registrar may, to the extent necessary for achieving any of the above purposes,
disclose, obtain or transfer (whether within or outside Hong Kong) the personal data to, from
or with any of the following:
 our Company’s appointed agents such as financial advisors, receiving bank and
overseas principal share registrar;
 HKSCC or HKSCC Nominees, who will use the personal data and may transfer the
personal data to the H Share Registrar for the purposes of providing its services or
facilities or performing its functions in accordance with its rules or procedures and
operating FINI and CCASS (including where applicants for the Hong Kong Offer
Shares request a deposit into CCASS);
 any agents, contractors or third-party service providers who offer administrative,
telecommunications, computer, payment or other services to our Company or the H
Share Registrar in connection with their respective business operation;
 the Stock Exchange, the SFC and any other statutory regulatory or governmental
bodies or otherwise as required by laws, rules or regulations, including for the
purpose of the Stock Exchange’s administration of the Listing Rules and the SFC’s
performance of its statutory functions; and
 any persons or institutions with which the holders of Hong Kong Offer Shares have
or propose to have dealings, such as their bankers, solicitors, accountants or brokers,
etc.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 639 –


--- page 651 ---
5. Retention of personal data
Our Company and the H Share Registrar will keep the personal data of the applicants and
holders of Hong Kong Offer Shares for as long as necessary to fulfil the purposes for which
the personal data were collected. Personal data which is no longer required will be destroyed
or dealt with in accordance with the Personal Data (Privacy) Ordinance (Chapter 486 of the
Laws of Hong Kong).
6. Access to and correction of personal data
Applicants for and holders of Hong Kong Offer Shares have the right to ascertain whether
our Company or the H Share Registrar hold their personal data, to obtain a copy of that data,
and to correct any data that is inaccurate. Our Company and the H Share Registrar have the
right to charge a reasonable fee for the processing of such requests. All requests for access to
data or correction of data should be addressed to our Company and the H Share Registrar, at
their registered address disclosed in the section headed “Corporate information” in this
Prospectus or as notified from time to time, for the attention of our company secretary, or the
H Share Registrar for the attention of the privacy compliance officer.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 640 –


--- page 652 ---
赤峰吉隆黃金礦業股份有限公司
Chifeng Jilong Gold Mining Co., Ltd.


--- page 653 ---
Volume 2
Stock Code : 6693
(A joint stock company incorporated in the People’s Republic of China with limited liability)
赤峰吉隆黃金礦業股份有限公司
Chifeng Jilong Gold Mining Co., Ltd.
GLOBAL
OFFERING


--- page 654 ---
This Prospectus is printed in three parts that together form the Prospectus. You
should read each part of the Prospectus in conjunction with the other parts
in order to understand the matters to which the Prospectus relates, including,
without limitation, the Hong Kong Public Offering and the International Offering.
Prospective investors should read each part of the Prospectus before making any
application in response to the Hong Kong Public Offering. We have adopted a
fully electronic application process for the Hong Kong Public Offering. We will
not provide printed copies of this Prospectus in relation to the Hong Kong Public
Offering. This  Prospectus  is  available  at  the  website  of  the  Stock  Exchange
at www.hkexnews.hk under the“HKEXnews > New Listings > New Listing
Information”section, and our website at cfgold.com. You may download and print
from these website addresses if you want a printed copy of this Prospectus.


--- page 655 ---
The following is the text of a report received from the independent reporting
accountants, Ernst & Young, Certified Public Accountants, Hong Kong, prepared for the
purpose of incorporation in this prospectus.
⭰㰟㛪姯⸒Ṳ⋀㈧
榀㸖毩歁㵳勘䙮怺979噆
⤑⏋✱ᷧ⺎27㧺
Tel 曢婘: +852 2846 9888
Fax ₚ䜆: +852 2868 4432
ey.com
Ernst & Young
27/F, One Taikoo Place
979 King’s Road
Quarry Bay, Hon
g Kong
ACCOUNTANTS’ REPORT ON HISTORICAL FINANCIAL INFORMATION TO THE
DIRECTORS OF CHIFENG JILONG GOLD MINING CO., LTD. AND CITIC
SECURITIES (HONG KONG) LTD.
Introduction
We report on the historical financial information of Chifeng Jilong Gold Mining Co., Ltd.
(the “Company”) and its subsidiaries (together, the “Group”) set out on pages IA-4 to IA-109,
which comprises the consolidated statements of profit or loss, the consolidated statements of
comprehensive income, the consolidated statements of changes in equity and the consolidated
statements of cash flows of the Group for each of the years ended 31 December 2021, 2022 and
2023, and the nine months ended 30 September 2024 (the “Relevant Periods”), and the
consolidated statements of financial position of the Group and the statements of financial
position of the Company as at 31 December 2021, 2022 and 2023 and 30 September 2024 and
material accounting policy information and other explanatory information (together, the
“Historical Financial Information”). The Historical Financial Information set out on pages IA-4
to IA-109 forms an integral part of this report, which has been prepared for inclusion in the
prospectus of the Company dated 28 February 2025 (the “Prospectus”) in connection with the
initial listing of the shares of the Company on the Main Board of The Stock Exchange of Hong
Kong Limited (the “Stock Exchange”).
Directors’ responsibility for the Historical Financial Information
The directors of the Company are responsible for the preparation of the Historical
Financial Information that gives a true and fair view in accordance with the basis of preparation
set out in Note 2 to the Historical Financial Information, and for such internal control as the
directors determine is necessary to enable the preparation of the Historical Financial
Information that is free from material misstatement, whether due to fraud or error.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-1 –


--- page 656 ---
Reporting accountants’ responsibility
Our responsibility is to express an opinion on the Historical Financial Information and to
report our opinion to you. We conducted our work in accordance with Hong Kong Standard on
Investment Circular Reporting Engagements 200 Accountants’ Reports on Historical Financial
Information in Investment Circulars issued by the Hong Kong Institute of Certified Public
Accountants (“HKICPA”). This standard requires that we comply with ethical standards and
plan and perform our work to obtain reasonable assurance about whether the Historical
Financial Information is free from material misstatement.
Our work involved performing procedures to obtain evidence about the amounts and
disclosures in the Historical Financial Information. The procedures selected depend on the
reporting accountants’ judgement, including the assessment of risks of material misstatement
of the Historical Financial Information, whether due to fraud or error. In making those risk
assessments, the reporting accountants consider internal control relevant to the entity’s
preparation of the Historical Financial Information that gives a true and fair view in accordance
with the basis of preparation set out in Note 2 to the Historical Financial Information, in order
to design procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the entity’s internal control. Our work also
included evaluating the appropriateness of accounting policies used and the reasonableness of
accounting estimates made by the directors, as well as evaluating the overall presentation of
the Historical Financial Information.
We believe that the evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.
Opinion
In our opinion, the Historical Financial Information gives, for the purposes of the
accountants’ report, a true and fair view of the financial position of the Group and the Company
as at 31 December 2021, 2022 and 2023 and 30 September 2024 and of the financial
performance and cash flows of the Group for each of the Relevant Periods in accordance with
the basis of preparation set out in Note 2 to the Historical Financial Information.
Review of interim comparative financial information
We have reviewed the interim comparative financial information of the Group which
comprises the consolidated statement of profit or loss, the consolidated statement of
comprehensive income, the consolidated statement of changes in equity and the consolidated
statement of cash flows for the nine months ended 30 September 2023 and other explanatory
information (the “Interim Comparative Financial Information”). The directors of the Company
are responsible for the preparation and presentation of the Interim Comparative Financial
Information in accordance with the basis of preparation set out in Note 2 to the Historical
Financial Information. Our responsibility is to express a conclusion on the Interim
Comparative Financial Information based on our review. We conducted our review in
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-2 –


--- page 657 ---
accordance with International Standard on Review Engagements 2410 Review of Interim
Financial Information Performed by the Independent Auditor of the Entity issued by the
International Auditing and Assurance Standards Board (“IAASB”). A review consists of
making inquiries, primarily of persons responsible for financial and accounting matters, and
applying analytical and other review procedures. A review is substantially less in scope than
an audit conducted in accordance with International Standards on Auditing and consequently
does not enable us to obtain assurance that we would become aware of all significant matters
that might be identified in an audit. Accordingly, we do not express an audit opinion. Based on
our review, nothing has come to our attention that causes us to believe that the Interim
Comparative Financial Information, for the purposes of the accountants’ report, is not prepared,
in all material respects, in accordance with the basis of preparation set out in Note 2 to the
Historical Financial Information.
Report on matters under the Rules Governing the Listing of Securities on the Stock
Exchange and the Companies (Winding Up and Miscellaneous Provisions) Ordinance
Adjustments
In preparing the Historical Financial Information, no adjustments to the Underlying
Financial Statements as defined on page IA-4 have been made.
Dividends
We refer to Note 16 to the Historical Financial Information which contains information
about the dividends paid by the Company in respect of the Relevant Periods.
Ernst & Y oung
Certified Public Accountants
Hong Kong
28 February 2025
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-3 –


--- page 658 ---
I. HISTORICAL FINANCIAL INFORMATION
Preparation of Historical Financial Information
Set out below is the Historical Financial Information which forms an integral part of this
accountants’ report.
The financial statements of the Group for the Relevant Periods, on which the Historical
Financial Information is based, were audited by Ernst & Y oung in accordance with
International Standards on Auditing issued by the IAASB (the “Underlying Financial
Statements”).
The Historical Financial Information is presented in Renminbi (“RMB”) and all values
are rounded to the nearest thousand (RMB’000) except when otherwise indicated.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-4 –


--- page 659 ---
CONSOLIDATED STATEMENTS OF PROFIT OR LOSS
Notes
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187 3,782,624 6,266,787 7,220,952 5,062,293 6,222,831
Cost of sales /H1118/H1118/H1118/H1118/H1118/H1118/H1118(2,525,121) (4,471,868) (4,868,078) (3,521,863) (3,600,815)
Gross profit /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,257,503 1,794,919 2,352,874 1,540,430 2,622,016
Other income and
gains /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810 90,512 142,088 137,770 90,608 271,985
Selling and distribution
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(777) (720) (689) (526) (317)
Administrative
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(393,035) (786,368) (850,390) (622,849) (651,899)
Research and
development
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(24,847) (27,652) (51,753) (24,952) (47,893)
Impairment losses on
financial assets, net /H1118 (1,984) (644) (2,440) (1,119) 1,624
Other expenses and
losses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811 (142,760) (119,022) (173,501) (86,769) (189,905)
Finance costs /H1118/H1118/H1118/H1118/H1118/H1118/H111812 (14,226) (176,485) (215,026) (143,290) (164,773)
Share of
(losses)/profits of
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(11) (4,104) 9,950 6,721 7,197
PROFIT BEFORE
TAX /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813 770,375 822,012 1,206,795 758,254 1,848,035
Income tax expenses /H1118/H111814 (156,967) (328,132) (335,210) (196,234) (583,266)
PROFIT FOR THE
YEAR/PERIOD /H1118/H1118/H1118/H1118 613,408 493,880 871,585 562,020 1,264,769
Attributable to:
Owners of the
parent /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118581,949 450,976 804,471 526,655 1,115,256
Non-controlling
interests /H1118/H1118/H1118/H1118/H1118/H1118/H111831,459 42,904 67,114 35,365 149,513
613,408 493,880 871,585 562,020 1,264,769
EARNINGS PER
SHARE
A TTRIBUTABLE
TO ORDINARY
EQUITY HOLDERS
OF THE PARENT
Basic /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
– For profit for the
year/period
(RMB) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815 0.35 0.27 0.49 0.32 0.68
Diluted /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
– For profit for the
year/period
(RMB) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.35 0.27 0.49 0.32 0.68
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-5 –


--- page 660 ---
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
PROFIT FOR THE
YEAR/PERIOD /H1118/H1118/H1118/H1118/H1118/H1118613,408 493,880 871,585 562,020 1,264,769
Other comprehensive
income/(loss) that may
be reclassified to
profit or loss in
subsequent periods,
net of tax:
Exchange differences on
translation of foreign
operations /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(59,166) 563,016 109,453 200,559 (79,944)
Cash flow hedges:
Effective portion of
changes in fair value
of hedging
instruments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,639 (3,639) – – (11,299)
OTHER
COMPREHENSIVE
INCOME/(LOSS) FOR
THE YEAR/PERIOD,
NET OF TAX /H1118/H1118/H1118/H1118/H1118/H1118/H1118(55,527) 559,377 109,453 200,559 (91,243)
TOTAL
COMPREHENSIVE
INCOME FOR THE
YEAR/PERIOD /H1118/H1118/H1118/H1118/H1118/H1118557,881 1,053,257 981,038 762,579 1,173,526
Attributable to:
Owners of the parent /H1118 532,607 867,940 883,526 673,810 1,046,932
Non-controlling
interests /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825,274 185,317 97,512 88,769 126,594
557,881 1,053,257 981,038 762,579 1,173,526
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-6 –


--- page 661 ---
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
Notes
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
NON-CURRENT ASSETS
Property, plant and equipment /H1118/H1118/H1118/H1118/H111817 3,159,699 5,994,266 6,521,646 6,894,292
Right-of-use assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818(a) 43,887 278,571 332,756 313,197
Other intangible assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819 856,450 6,562,718 6,323,009 6,042,442
Goodwill /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820 41,969 41,969 41,969 41,969
Investments in associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111821 1,989 357,819 373,481 2,050
Deferred tax assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111822 5,215 53,978 17,482 55,555
Other non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111823 186,230 145,508 212,070 220,683
TOTAL NON-CURRENT ASSETS /H1118/H1118/H1118 4,295,439 13,434,829 13,822,413 13,570,188
CURRENT ASSETS
Inventories /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111824 1,412,094 2,164,628 2,406,909 2,449,670
Trade receivables from the
comprehensive recycling of
resources business /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825 311,447 339,237 397,481 443,286
Trade receivables from gold and
commodities sales /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111826 25,260 29,637 115,732 163,455
Prepayments, other receivables and
other assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111827 166,944 242,143 282,596 814,170
Financial assets at fair value
through profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111828 11,237 48,131 16,909 13,204
Derivative financial assets /H1118/H1118/H1118/H1118/H1118/H1118/H111829 6,436 584 13,470 43,438
Restricted cash /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111830 116,881 232,560 387,648 303,616
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H111830 1,707,868 1,052,545 1,274,635 2,094,141
TOTAL CURRENT ASSETS /H1118/H1118/H1118/H1118/H1118/H1118/H11183,758,167 4,109,465 4,895,380 6,324,980
TOTAL ASSETS /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,053,606 17,544,294 18,717,793 19,895,168
CURRENT LIABILITIES
Trade and notes payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111832 440,401 851,390 552,457 636,817
Contract liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111833 4,547 62,052 73,177 89,172
Financial liabilities at fair value
through profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111831 387,683 620,250 939,996 1,026,210
Derivative financial liabilities /H1118/H1118/H1118/H1118/H111829 1,831 – – 17,002
Other payables and accruals /H1118/H1118/H1118/H1118/H1118/H111834 191,169 695,336 697,447 792,303
Income tax payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118102,438 177,082 267,693 455,815
Short-term loans
/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111835 – 488,409 850,009 822,730
Current portion of long-term loans /H111836 25,530 333,770 218,315 641,778
Current portion of lease liabilities /H1118/H111818(b) 1,424 31,177 38,083 38,204
Current portion of other non-current
liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111838 186,589 10,849 9,485 5,717
Current portion of provisions /H1118/H1118/H1118/H1118/H111837 – 9,567 75,747 71,806
TOTAL CURRENT LIABILITIES /H1118/H1118/H1118 1,341,612 3,279,882 3,722,409 4,597,554
NET CURRENT ASSETS /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,416,555 829,583 1,172,971 1,727,426
TOTAL ASSETS LESS CURRENT
LIABILITIES /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,711,994 14,264,412 14,995,384 15,297,614
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-7 –


--- page 662 ---
Notes
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
NON-CURRENT LIABILITIES
Long-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111836 – 1,513,781 1,421,974 681,614
Contract liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111833 – 606,298 576,999 538,996
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818(b) 2,975 230,805 207,219 185,340
Deferred tax liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111822 1,916 2,455,981 2,314,654 2,245,052
Provisions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111837 1,631,259 1,984,834 1,868,099 1,781,346
Other non-current liabilities /H1118/H1118/H1118/H1118/H1118/H111838 74,813 64,410 64,231 65,368
TOTAL NON-CURRENT
LIABILITIES /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,710,963 6,856,109 6,453,176 5,497,716
NET ASSETS /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,001,031 7,408,303 8,542,208 9,799,898
EQUITY
Equity attributable to owners of
the parent
Share capital /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111839 1,663,911 1,663,911 1,663,911 1,663,911
Treasury shares /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (300,787) (520,803) (220,016)
Reserves /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111841 2,956,506 3,824,446 5,008,882 5,672,591
4,620,417 5,187,570 6,151,990 7,116,486
Non-controlling interests /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111842 380,614 2,220,733 2,390,218 2,683,412
TOTAL EQUITY /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,001,031 7,408,303 8,542,208 9,799,898
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-8 –


--- page 663 ---
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
Y ear ended 31 December 2021
Attributable to owners of the parent
Share
capital
Share
premium*
Reserve
fund*
Hedging
reserve*
Exchange
fluctuation
reserve*
Safety
fund
surplus
reserve*
Retained
profits* Total
Non-
controlling
interests
Total
equity
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(note 39)
At 1 January 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,663,911 626,614 48,816 – (381,968) 1,665 2,128,772 4,087,810 355,340 4,443,150
Profit for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – – – – 581,949 581,949 31,459 613,408
Other comprehensive income/(loss)
for the year:
Foreign exchange differences, net /H1118/H1118 – – – – (53,164) – – (53,164) (6,002) (59,166)
Changes in fair value of the
effective portion and
reclassification of cash flow
hedges, net of tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 3,822 – – – 3,822 (183) 3,639
Total comprehensive income for
the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 3,822 (53,164) – 581,949 532,607 25,274 557,881
Transfer from/(to) retained profits,
net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 32,610 – – (633) (31,977) – – –
At 31 December 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,663,911 626,614 81,426 3,822 (435,132) 1,032 2,678,744 4,620,417 380,614 5,001,031
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-9 –


--- page 664 ---
Y ear ended 31 December 2022
Attributable to owners of the parent
Share
capital
Treasury
shares
Share
premium*
Reserve
fund*
Hedging
reserve*
Exchange
fluctuation
reserve*
Safety
fund
surplus
reserve*
Retained
profits* Total
Non-
controlling
interests
Total
equity
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(note 39)
At 1 January 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H11181,663,911 – 626,614 81,426 3,822 (435,132) 1,032 2,678,744 4,620,417 380,614 5,001,031
Profit for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – – – – – 450,976 450,976 42,904 493,880
Other comprehensive
income/(loss) for the year:
Exchange differences on
translation of foreign
operations /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – – – 420,786 – – 420,786 142,230 563,016
Changes in fair value of the
effective portion and
reclassification of cash flow
hedges, net of tax /H1118/H1118/H1118/H1118/H1118/H1118– – – – (3,822) – – – (3,822) 183 (3,639)
Total comprehensive income for
the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – – (3,822) 420,786 – 450,976 867,940 185,317 1,053,257
Acquisition of a subsidiary
(Note 50) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–– ––– –––– 1,666,393 1,666,393
Dividends paid to non-controlling
interests /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–– ––– –––– (40,991) (40,991)
Capital injection from
non-controlling interests
of a subsidiary /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–– ––– –––– 29,400 29,400
Repurchase of shares /H1118/H1118/H1118/H1118/H1118/H1118– (300,787) – – – – – – (300,787) – (300,787)
Transfer from/(to) retained profits,
net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 50,698 – – (139) (50,559) – – –
At 31 December 2022 /H1118/H1118/H1118/H1118/H1118/H11181,663,911 (300,787) 626,614 132,124 – (14,346) 893 3,079,161 5,187,570 2,220,733 7,408,303
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-10 –


--- page 665 ---
Y ear ended 31 December 2023
Attributable to owners of the parent
Share
capital
Treasury
shares
Share
premium*
Other
capital
reserve*
Reserve
fund*
Exchange
fluctuation
reserve*
Safety
fund
surplus
reserve*
Retained
profits* Total
Non-
controlling
interests
Total
equity
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(note 39)
At 1 January 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H11181,663,911 (300,787) 626,614 – 132,124 (14,346) 893 3,079,161 5,187,570 2,220,733 7,408,303
Profit for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – – – – – 804,471 804,471 67,114 871,585
Other comprehensive income for
the year:
Exchange differences on
translation of foreign
operations /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – – – 79,055 – – 79,055 30,398 109,453
Total comprehensive income for
the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – – – 79,055 – 804,471 883,526 97,512 981,038
Acquisition of a subsidiary
(Note 50) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–– ––– –––– 71,973 71,973
Repurchase of shares (note i) /H1118/H1118/H1118 – (220,016) – – – – – – (220,016) – (220,016)
Other (note ii) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 300,910 – – – – 300,910 – 300,910
Transfer from retained profits /H1118/H1118/H1118 – – – – 71,600 – 538 (72,138) – – –
At 31 December 2023 /H1118/H1118/H1118/H1118/H1118/H11181,663,911 (520,803) 626,614 300,910 203,724 64,709 1,431 3,811,494 6,151,990 2,390,218 8,542,208
Note i: During the year ended 31 December 2023, the Company repurchased a total of 15,182,600 shares,
amounting to RMB220,016,000, to implement employee stock ownership plan or share incentive plan in the
future.
Note ii: As of 31 December 2023, the vesting conditions for the Phase II Employee Stock Ownership Plan have been
met, and the shares will be exercised after 28 April 2024. The amount prepaid by the employees for the
shares is recorded in other capital reserve in the amount of RMB300,910,000.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-11 –


--- page 666 ---
Nine months ended 30 September 2023 (unaudited)
Attributable to owners of the parent
Share
capital
Treasury
shares
Share
premium*
Reserve
fund*
Exchange
fluctuation
reserve*
Safety
fund
surplus
reserve*
Retained
profits* Total
Non-
controlling
interests
Total
equity
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(note 39)
At 1 January 2023 /H1118/H1118/H1118/H1118/H1118/H11181,663,911 (300,787) 626,614 132,124 (14,346) 893 3,079,161 5,187,570 2,220,733 7,408,303
Profit for the period /H1118/H1118/H1118/H1118/H1118– – – – – – 526,655 526,655 35,365 562,020
Other comprehensive income
for the period:
Exchange differences on
translation of foreign
operations /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – – 147,155 – – 147,155 53,404 200,559
Total comprehensive income
for the period /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – – 147,155 – 526,655 673,810 88,769 762,579
Acquisition of a subsidiary
(Note 50) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – – – – – – 71,973 71,973
Repurchase of shares (note i) /H1118 – (215,014) – – – – – (215,014) – (215,014)
Transfer from retained profits /H1118 – – – – – 3,094 (3,094) – – –
At 30 September 2023 /H1118/H1118/H1118/H11181,663,911 (515,801) 626,614 132,124 132,809 3,987 3,602,722 5,646,366 2,381,475 8,027,841
Note i: During the period ended 30 September 2023, the Company repurchased a total of 14,182,600 shares,
amounting to RMB215,014,000, to implement employee stock ownership plan or share incentive plan in the
future.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-12 –


--- page 667 ---
Nine months ended 30 September 2024
Attributable to owners of the parent
Share
capital
Treasury
shares
Share
premium*
Other
capital
reserve*
Reserve
fund*
Hedging
reserve*
Exchange
fluctuation
reserve*
Safety
fund
surplus
reserve*
Retained
profits* Total
Non-
controlling
interests
Total
equity
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(note 39)
At 1 January 2024 /H1118/H11181,663,911 (520,803) 626,614 300,910 203,724 – 64,709 1,431 3,811,494 6,151,990 2,390,218 8,542,208
Profit for the period /H1118 – – – – – – – – 1,115,256 1,115,256 149,513 1,264,769
Other comprehensive
income for the
period:
Exchange differences
on translation of
foreign operations /H1118 – – – – – – (59,760) – – (59,760) (20,184) (79,944)
Changes in fair value
of the effective
portion and
reclassification of
cash flow hedges,
net of tax /H1118/H1118/H1118/H1118 – – – – – (8,564) – – – (8,564) (2,735) (11,299)
Total comprehensive
income for the
period /H1118/H1118/H1118/H1118/H1118/H1118– – – – – (8,564) (59,760) – 1,115,256 1,046,932 126,594 1,173,526
Exercise of share
incentive plan /H1118/H1118/H1118 – 300,787 – (300,787) – – –––– ––
Final 2023 dividend
declared /H1118/H1118/H1118/H1118/H1118– – – – – – – – (82,436) (82,436) – (82,436)
Contribution from
non-controlling
interests /H1118/H1118/H1118/H1118/H1118–– ––– – –––– 166,600 166,600
Transfer from
retained profits /H1118/H1118 – – – – – – – 10,090 (10,090) – – –
At 30 September
2024 /H1118/H1118/H1118/H1118/H1118/H11181,663,911 (220,016) 626,614 123 203,724 (8,564) 4,949 11,521 4,834,224 7,116,486 2,683,412 9,799,898
* These reserve accounts comprise the consolidated reserves in the consolidated statements of financial position
as at 31 December 2021, 2022 and 2023 and 30 September 2024.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-13 –


--- page 668 ---
CONSOLIDATED STATEMENTS OF CASH FLOWS
Notes
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
CASH FLOWS FROM
OPERA TING ACTIVITIES
Profit before tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118770,375 822,012 1,206,795 758,254 1,848,035
Adjustments for:
Impairment losses/(reversal
of impairment losses) on
inventories /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813 191,615 41,723 3,516 (18,038) 7,251
Impairment losses/(gains)
on financial assets, net /H1118/H111813 1,984 644 2,440 1,119 (1,624)
Depreciation of property,
plant and equipment /H1118/H1118/H1118/H111813 455,688 761,217 910,774 591,421 687,486
Depreciation of right-of-use
assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813 3,607 30,180 36,973 21,466 29,017
Amortisation of other
intangible assets /H1118/H1118/H1118/H1118/H1118/H111813 315,883 582,247 552,382 459,875 225,945
Amortisation of non-current
assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813 4,152 1,843 85 64 37
Loss on disposal of
non-current assets /H1118/H1118/H1118/H1118/H111811 3,060 2,632 1,853 1,388 367
Fair value changes of
financial assets and
liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,696 11,914 71,343 9,356 57,094
Finance costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812 14,226 176,485 215,026 143,290 164,773
Foreign exchange
differences, net /H1118/H1118/H1118/H1118/H1118/H1118/H111811 (86,237) (27,244) (20,157) (18,855) (27,781)
Share of losses/(profits) of
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811 4,104 (9,950) (6,721) (7,197)
Gains on disposal of
derivative financial
instruments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810 (25,014) (82,913) (75,343) (34,937) (143,446)
Investment gains received
from listed equity
investments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810 – – (4,226) – –
Gains on disposal of
investment in an
associate /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810 –––– (71,119)
Interest received from bank
structured deposits /H1118/H1118/H1118/H1118/H1118 –––– (12)
Investment losses received
from disposal of
financial liabilities held
for trading /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811 10,856 17,249 76,018 55,930 107,426
Gain on bargain purchase
recognised in other
income and gains /H1118/H1118/H1118/H1118/H1118/H111810 – (6,371) – – –
Subtotal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,661,902 2,335,722 2,967,529 1,963,612 2,876,252
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-14 –


--- page 669 ---
Notes
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
(Increase)/decrease in
inventories /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(815,667) (328,969) (143,830) (171,425) (73,659)
Decrease/(increase) in trade
receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(17,216) (38,667) (144,339) (227,963) (93,528)
Increase in prepayments,
other receivables and
other assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(66,045) (36,409) 9,047 (83,399) (92,056)
Increase/(decrease) in trade
and notes payables /H1118/H1118/H1118/H1118/H1118143,372 (217,967) (262,103) (71,798) 27,555
Increase/(decrease) in other
payables and accruals /H1118/H1118/H1118 (18,448) (300,173) 160,855 57,700 (147,954)
Increase/(decrease) in
contract liabilities /H1118/H1118/H1118/H1118/H11183,125 (53,930) 11,126 35,169 15,995
Decrease/(increase) in
restricted cash /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814,532 (10,243) (2,632) 9,462 3,206
Cash generated from
operations /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118905,555 1,349,364 2,595,653 1,511,358 2,515,811
Income tax paid /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(150,406) (259,231) (392,573) (305,995) (471,823)
Net cash flows from
operating activities /H1118/H1118/H1118/H1118/H1118755,149 1,090,133 2,203,080 1,205,363 2,043,988
CASH FLOWS FROM
INVESTING
ACTIVITIES
Cash received from
disposal of investments /H1118/H1118 –––– 456,401
Cash received from
investment income /H1118/H1118/H1118/H1118/H111815,33 0––––
Proceeds from disposal of
property, plant and
equipment, intangible
assets, and other
non-current assets /H1118/H1118/H1118/H1118/H11181,902 13,993 19,877 8,516 627
Net cash received from the
disposal of subsidiaries /H1118/H1118 288,783 ––––
Cash received from
futures contract /H1118/H1118/H1118/H1118/H1118/H1118/H1118– 592,835 235,405 62,718 300,897
Cash received from bank
deposits and interest /H1118/H1118/H1118/H11182,477,600 100,095 – – 20,012
Repayment of prepaid
equity investment /H1118/H1118/H1118/H1118/H1118/H111835,52 8––––
Cash received of disposal
of financial assets at fair
value through profit or
loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 13,434 – –
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-15 –


--- page 670 ---
Notes
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Purchases of property, plant
and equipment,
intangible assets and
other non-current assets /H1118 (1,342,365) (1,917,613) (1,741,966) (1,335,103) (1,113,392)
Cash paid for equity
investments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(14,556) (365,680) – – –
Net cash paid for
acquisition of a
subsidiary /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (1,958,363) (18,095) (18,095) –
Cash prepaid for equity
acquisition /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–––– (66,844)
Cash paid for futures
contract /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (369,314) (279,774) (161,057) (254,828)
Cash paid for large
certificates and bank
deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,740,095) (80,000) – – (20,000)
Net cash flows used in
investing activities /H1118/H1118/H1118/H1118/H1118(277,873) (3,984,047) (1,771,119) (1,443,021) (677,127)
CASH FLOWS FROM
FINANCING
ACTIVITIES
Cash received from
non-controlling
interests /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 29,400 – – 166,600
New bank borrowings /H1118/H1118/H1118/H1118 – 2,443,305 1,151,050 632,127 1,044,305
New gold lease business /H1118/H1118 384,572 496,873 739,959 596,323 599,282
New loans from related
parties /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118620,000 1,537,240 – – –
Cash received from gold
lease deposit /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111817,150 8,003 242,518 242,518 364,737
Cash received from eligible
participants in share
incentive plan /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 300,910 300,549 –
Cash received from share
incentive platform of
SIP I (note 40) /H1118/H1118/H1118/H1118/H1118/H1118/H1118663,193 ––––
Repayment of bank
borrowings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(248,866) (210,400) (1,013,745) (543,245) (1,381,891)
Cash paid for distribution
of dividends or profit
and interest expenses /H1118/H1118/H1118 (11,582) (172,160) (146,126) (116,700) (200,471)
Repayment of gold lease
business /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(83,816) (311,970) (560,674) (446,501) (706,400)
Cash paid for repurchasing
shares for share incentive
plan /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(663,193) (300,787) (220,016) (215,014) –
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-16 –


--- page 671 ---
Notes
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Repayment of loans to
related parties /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(620,000) (1,126,300) (300,040) – (128,546)
Repayment of lease
liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,553) (33,696) (58,102) (28,507) (30,686)
Cash paid for bank
borrowings deposits /H1118/H1118/H1118 – (13,965) – – –
Cash (paid)/received for
notes payable deposits /H1118/H1118 – (20,400) 20,400 20,400 –
Cash paid for gold lease
deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (100,000) (384,254) (184,245) (281,393)
Net cash flows from/(used
in) financing activities /H1118/H1118 55,905 2,225,143 (228,120) 257,705 (554,463)
NET INCREASE/
(DECREASE) IN
CASH AND CASH
EQUIV ALENTS/H1118/H1118/H1118/H1118/H1118/H1118/H1118533,181 (668,771) 203,841 20,047 812,398
Cash and cash equivalents
at beginning of
year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,176,419 1,707,868 1,052,545 1,052,545 1,274,635
Effect of foreign exchange
rate changes, net /H1118/H1118/H1118/H1118/H1118/H1118(1,732) 13,448 18,249 12,708 7,108
CASH AND CASH
EQUIV ALENTS A T END
OF YEAR/PERIOD /H1118/H1118/H1118/H111830 1,707,868 1,052,545 1,274,635 1,085,300 2,094,141
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-17 –


--- page 672 ---
STATEMENTS OF FINANCIAL POSITION
Notes
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
NON-CURRENT ASSETS
Property, plant and equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111817 30,499 12,322 2,815 2,590
Right-of-use assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818(a) – 9,325 4,357 1,089
Other intangible assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,566 1,353 1,237 1,114
Investments in subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111821 4,240,871 6,134,845 6,217,346 6,390,746
Investments in associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111821 1,989 1,729 1,545 1,421
Other non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,342 53 131 22
TOTAL NON-CURRENT ASSETS /H1118/H1118/H1118/H1118/H1118/H11184,277,267 6,159,627 6,227,431 6,396,982
CURRENT ASSETS
Prepayments, other receivables and
other assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111827 392,090 332,848 1,189,416 901,487
Restricted cash /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111830 – – 13,965 –
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111830 1,029,019 401,708 230,205 359,803
TOTAL CURRENT ASSETS /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,421,109 734,556 1,433,586 1,261,290
TOTAL ASSETS /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,698,376 6,894,183 7,661,017 7,658,272
CURRENT LIABILITIES
Trade and notes payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182 0–––
Other payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111834 969,547 751,869 624,945 1,114,088
Short-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111835 – 358,620 600,637 265,460
Current portion of long-term loans /H1118/H1118/H1118/H111836 – 237,831 119,251 319,598
Current portion of other non-current
liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118173,566 – – –
Current portion of lease liabilities /H1118/H1118/H1118/H1118/H111818(b) – 4,659 4,385 2,271
TOTAL CURRENT LIABILITIES /H1118/H1118/H1118/H1118/H1118/H11181,143,133 1,352,979 1,349,218 1,701,417
NET CURRENT ASSETS/
(LIABILITIES) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118277,976 (618,423) 84,368 (440,127)
TOTAL ASSETS LESS CURRENT
LIABILITIES /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,555,243 5,541,204 6,311,799 5,956,855
NON-CURRENT LIABILITIES
Long-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111836 – 774,895 753,470 485,047
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818(b) – 4,876 – –
TOTAL NON-CURRENT LIABILITIES /H1118/H1118 – 779,771 753,470 485,047
NET ASSETS /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,555,243 4,761,433 5,558,329 5,471,808
EQUITY
Share capital /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,663,911 1,663,911 1,663,911 1,663,911
Treasury shares /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (300,787) (520,803) (220,016)
Reserves /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111851 2,891,332 3,398,309 4,415,221 4,027,913
TOTAL EQUITY /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,555,243 4,761,433 5,558,329 5,471,808
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-18 –


--- page 673 ---
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION
1. CORPORATE INFORMATION
The Company is a joint stock company with limited liability incorporated in the People’s Republic of China
(the “PRC”). The registered address of the Company is Fu Min Village, Si Dao Wan Zi Town, Ao Han County,
Chifeng City, Inner Mongolia Autonomous Region, PRC and the office is located at A7-Xiaojing, Wanfeng Road,
Fengtai District, Beijing. Ms. Li Jinyang and Y antai Hanfeng Zhongxing Management Consulting Center (Limited
Partnership) (“Hanfeng Zhongxin”) directly held 190,410,595 and 51,515,151 A Shares, accounting for
approximately 11.44% and 3.10% of the issued share capital of the Company, respectively. Meanwhile, Ms. Li
Jinyang is the sole limited partner of Hanfeng Zhongxin accounting for approximately 99% of the committed capital
Contribution of Hanfeng Zhongxin. Ms. Li Jinyang and Hanfeng are collectively regarded as the Single Largest
Shareholder Group of the Company.
During the Relevant Periods, the Company and its subsidiaries were involved in the mining of gold and
non-ferrous metal and the comprehensive recycling of resources. The main products are gold, silver, electrolytic
copper and other precious metals and non-ferrous metals.
As at the date of this report, the Company had direct and indirect interests in its subsidiaries, all of which are
private limited liability companies, the particulars of which are set out below:
Name*
Place and date of
incorporation/
registration and place
of operations Registered capital
Percentage of
equity attributable
to the Company
Principal activitiesDirect Indirect
Chifeng Jilong Mining Co.,
Ltd. (“Jilong Mining”)ࢤ
ப΂ʮ̡ (note
(a)) * /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118PRC 2005-10-24 RMB175,000,000 100% – Mining
Chifeng Huatai Mining Co.,
Ltd.ப΂ʮ
̡ (note (a)) * /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118PRC 2005-01-08 RMB20,000,000 – 100% Mining
Liaoning Wulong Gold Mining
Co., Ltd. (“Wulong Mining”)
ப΂ʮ
̡ (note (a)) * /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118PRC 2008-04-08 RMB40,000,000 – 100% Mining
Dandong Tongxing Mineral
Processing Ltd. (“TMP”) ʗ
ப΂ʮ̡
(note (b)) * /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118PRC 2012-04-19 RMB5,000,000 – 100% Processing
Anhui Guangyuan Technology
Development Co., Ltd.
(“Guangyuan Technology”)
ʮ̡
(note (a)) * /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118PRC 2003-08-06 RMB44,776,000 55% –
Wasted
Electronic
Products
Recovery
Hefei Huanchuang Advanced
Material Co., Ltd.ᐑ௴
ʮ̡ (note (b)) * /H1118PRC 2018-05-25 RMB10,000,000 – 55%
Wasted
Electronic
Products
Recovery
Hefei Guangyuan
Environmental Protection
Technology Co., Ltd.ᄿ
ʮ̡ (note
(b)) * /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118PRC 2022-12-27 RMB10,000,000 – 55%
Wasted
Electronic
Products
Recovery
Kunming Xinhenghe Mining
Co., Ltd. (“Xinhenghe
Mining”)ࠢ
ʮ̡ (note (c)) * /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118PRC 2021-01-26 RMB40,000,000 51% – Management
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-19 –


--- page 674 ---
Name*
Place and date of
incorporation/
registration and place
of operations Registered capital
Percentage of
equity attributable
to the Company
Principal activitiesDirect Indirect
Eryuan Jintai Mining
Development Co., Ltd.
(“Jintai Mining”)๕ᎀइᘤ
ப΂ʮ̡ (note
(b)) * (note (j)) * /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118PRC 2008-02-20 RMB41,710,000 – 46% Mining
Chijin (Tianjin) Geological
Exploration Technology Co.,
Ltd.ږ(ݵ)Ҧஔ
ʮ̡ (note (d)) * /H1118/H1118/H1118/H1118/H1118PRC 2017-05-22 RMB1,000,000 60% –
Geological
exploration
CHIJIN LAOS Holdings
Limited (“Chijin Laos”)
(note (b)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Cayman Islands
1993-05-25 USD152,100,000 100% –
Investment
Holding
Chixia Laos Holdings Limited
(“Chixia Laos”) (note (b)) /H1118/H1118
Cayman Islands
2022-10-25 USD50,000 – 51%
Investment
Holding
Lane Xang Minerals Limited
Company (“LXML”)
(note (e)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Laos
1993-09-30 LAK1,436,516,830,000 – 90% Mining
Chijin International (HK)
Limited (“Chijin HK”)
(note (f)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Hong Kong
2018-02-27
HKD1
USD291,000,000 100% –
Investment
Holding
Jilin Hanfeng Mining
Technology Co., Ltdᖍ
ʮ̡ (note
(a)) * /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118PRC 2004-09-24 RMB429,200,000 100% – Mining
Shanghai Chijin Fengyu
Industrial Co., Ltd.ږ
ʮ̡ (note
(a)) * /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118PRC 2021-03-25 RMB100,000,000 100% – Trading
Golden Star Resources Ltd.
(“GSR”) (note (g)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118
Canada
1992-05-15 USD932,928,541 – 62%
Investment
Holding
Caystar Holdings (note (b)) /H1118/H1118/H1118
Cayman Islands
1997-05-07 USD391,958,328 – 62% Management
Caystar Finance Co. (note (b)) /H1118
Cayman Islands
2015-04-28 USD49,942,492 – 62% Finance
Caystar Management Holdings
(note (b)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Cayman Islands
2003-09-01 USD45,409,069 – 62% Management
Wasford Holdings (note (b)) /H1118/H1118
Cayman Islands
2002-04-02 USD50,000 – 62% Management
Golden Star (Wassa) Ltd.
(note (h)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Ghana
2001-11-22 GHS11,000,000 – 56% Mining
Golden Star Resources (UK)
Ltd. (note (b)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
England
2019-05-10 USD130 – 62% Management
Xiamen Chijin Xiawu Metal
Resources Limited (“Chijin
Xiawu”)᙮༟
ʮ̡ (note (i)) * /H1118/H1118/H1118/H1118PRC 2022-10-18 RMB400,000,000 51% –
Investment
Holding
Notes:
(a) The statutory financial statements for the year ended 31 December 2021 prepared under PRC Generally
Accepted Accounting Principles (“PRC GAAP”) were audited by ZhongShen ZhongHuan Certified
Public Accountants LLP , certified public accountants registered in the PRC, and the statutory financial
statements for the years ended 31 December 2022 and 2023 prepared under PRC GAAP were audited
by Ernst & Y oung Hua Ming LLP .
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-20 –


--- page 675 ---
(b) No audited financial statements have been prepared for these entities for the years ended 31 December
2021, 2022 and 2023 (or since the date of incorporation, where later than the beginning of the Relevant
Periods), as the entities were not subject to any statutory audit requirements under the relevant rules and
regulations in their jurisdictions of incorporation.
(c) The statutory financial statements for the year ended 31 December 2022 prepared under PRC GAAP
were audited by Y unnan Xizheng Accounting Firm Co., Ltd., certified public accountants registered in
the PRC, and for the year ended 31 December 2023 prepared under PRC GAAP were audited by Ernst
& Y oung Hua Ming LLP .
(d) The statutory financial statements for the year ended 31 December 2021 prepared under PRC GAAP
were audited by ZhongShen ZhongHuan Certified Public Accountants LLP , certified public accountants
registered in the PRC, and the statutory financial statements for the year ended 31 December 2022
prepared under PRC GAAP were audited by Ernst & Y oung Hua Ming LLP . No statutory financial
statements has been issued for the year ended 31 December 2023.
(e) The statutory financial statements of this entity for the year ended 31 December 2021 prepared under
International Financial Reporting Standards (“IFRSs”) were audited by KPMG Lao Co., Ltd., certified
public accountants registered in Laos, and the statutory financial statements for the years ended 31
December 2022 and 2023 prepared under IFRSs were audited by Ernst & Y oung Lao Co., Ltd.
(f) The statutory financial statements of this entity for the year ended 31 December 2021 prepared under
Hong Kong Financial Reporting Standards (“HKFRSs”) were audited by Reanda Lau & Au Y eung (HK)
CPA Limited, certified public accountants registered in Hong Kong, and the statutory financial
statements for the year ended 31 December 2022 prepared under HKFRSs were audited by Ernst &
Y oung, Hong Kong, and the statutory financial statements for the year ended 31 December 2023
prepared under HKFRSs were audited by Zhonghui Anda CPA Limited, certified public accountants
registered in Hong Kong.
(g) The statutory financial statements of this entity for the years ended 31 December 2021 prepared under
IFRSs were audited by PricewaterhouseCoopers LLP , certified public accountants registered in Canada.
No statutory financial statements has been issued for the years ended 31 December 2022 and 2023.
(h) The statutory financial statements of this entity for the year ended 31 December 2021 prepared under
IFRSs were audited by PricewaterhouseCoopers LLP , certified public accountants registered in Ghana,
and the statutory financial statements for the years ended 31 December 2022 and 2023 prepared under
IFRSs were audited by Ernst & Y oung Ghana.
(i) The statutory financial statements for the years ended 31 December 2022 and 2023 prepared under PRC
GAAP were audited by Ernst & Y oung Hua Ming LLP .
(j) The Company directly holds 51% shares of Xinhenghe Mining and has control on Xinhenghe Mining.
Xinhenghe Mining directly holds 90% shares of Jintai Mining and has control on Jintai Mining. In
summary, the Company indirectly holds 46% shares of Jintai Mining and has control on Jintai Mining,
so Jintai Mining is classified as a subsidiary of the Company.
* The English names of these entities registered in the PRC represent the best efforts made by the
management of the Company to directly translate their Chinese names as they did not register any
official English names.
2. BASIS OF PREPARATION
The Historical Financial Information has been prepared in accordance with International Financial Reporting
Standards (“IFRSs”), which comprise all standards and interpretations approved by the International Accounting
Standards Board (the “IASB”). All IFRSs effective for the accounting period commencing from 1 January 2024,
together with the relevant transitional provisions, have been early adopted by the Group in the preparation of the
Historical Financial Information throughout the Relevant Periods and in the period covered by the Interim
Comparative Financial Information.
The Historical Financial Information has been prepared on a going concern basis.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-21 –


--- page 676 ---
The Historical Financial Information has been prepared under the historical cost convention, except for
derivative financial instruments, financial assets and financial liabilities at fair value through profit or loss which
have been measured at fair value.
Basis of consolidation
The Historical Financial Information includes the financial statements of the Company and its subsidiaries
(collectively referred to as the “Group”) for the Relevant Periods. A subsidiary is an entity (including a structured
entity), directly or indirectly, controlled by the Company. Control is achieved when the Group is exposed, or has
rights, to variable returns from its involvement with the investee and has the ability to affect those returns through
its power over the investee (i.e., existing rights that give the Group the current ability to direct the relevant activities
of the investee).
Generally, there is a presumption that a majority of voting rights results in control. When the Company has
less than a majority of the voting or similar rights of an investee, the Group considers all relevant facts and
circumstances in assessing whether it has power over an investee, including:
(a) the contractual arrangement with the other vote holders of the investee;
(b) rights arising from other contractual arrangements; and
(c) the Group’s voting rights and potential voting rights.
The financial statements of the subsidiaries are prepared for the same reporting period as the Company, using
consistent accounting policies. The results of subsidiaries are consolidated from the date on which the Group obtains
control, and continue to be consolidated until the date that such control ceases.
Profit or loss and each component of other comprehensive income are attributed to the owners of the parent
of the Group and to the non-controlling interests, even if this results in the non-controlling interests having a deficit
balance. All intra-group assets and liabilities, equity, income, expenses and cash flows relating to transactions
between members of the Group are eliminated in full on consolidation.
The Group reassesses whether or not it controls an investee if facts and circumstances indicate that there are
changes to one or more of the three elements of control described above. A change in the ownership interest of a
subsidiary, without a loss of control, is accounted for as an equity transaction.
If the Group loses control over a subsidiary, it derecognises the related assets (including goodwill), liabilities,
any non-controlling interest and the exchange fluctuation reserve; and recognises the fair value of any investment
retained and any resulting surplus or deficit in profit or loss. The Group’s share of components previously recognised
in other comprehensive income is reclassified to profit or loss or retained profits, as appropriate, on the same basis
as would be required if the Group had directly disposed of the related assets or liabilities.
3. ISSUED BUT NOT YET EFFECTIVE INTERNATIONAL FINANCIAL REPORTING STANDARDS
The standards and interpretations that have been issued but not yet effective up to the date of this report are
disclosed below.
Amendments to IAS 21 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Lack of Exchangeability
1
Amendments to IFRS 10 and IAS 28 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Sale or Contribution of Assets between an Investor
and its Associate or Joint V enture 2
IFRS 18 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Presentation and Disclosure in Financial
Statements 4
IFRS 19 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Subsidiaries without Public Accountability:
Disclosures 4
Amendments to IFRS 9 and IFRS 7 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Amendments to the Classification and Measurement
of Financial Instruments 3
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-22 –


--- page 677 ---
1 Effective for annual periods beginning on or after 1 January 2025
2 No mandatory effective date yet determined but available for adoption
3 Effective for annual periods beginning on or after 1 January 2026
4 Effective for annual periods beginning on or after 1 January 2027
The Group is currently working to identify all impacts the amendments will have on the primary financial
statements and notes to the financial statements. So far, the Group considers that these new and revised IFRSs may
result in changes in accounting policies but are unlikely to have a significant impact on the Group’s result of
operation and financial position.
4. MATERIAL ACCOUNTING POLICIES
Investments in associates
An associate is an entity in which the Group has a long term interest of generally not less than 20% of the
equity voting rights and over which it has significant influence. Significant influence is the power to participate in
the financial and operating policy decisions of the investee, but is not control or joint control over those policies.
The Group’s investments in associates are stated in the consolidated statement of financial position at the
Group’s share of net assets under the equity method of accounting, less any impairment losses.
The Group’s share of the post-acquisition results and other comprehensive income of associates is included in
the consolidated statement of profit or loss and consolidated other comprehensive income, respectively. In addition,
when there has been a change recognised directly in the equity of the associate, the Group recognises its share of any
changes, when applicable, in the consolidated statement of changes in equity. Unrealised gains and losses resulting
from transactions between the Group and its associates are eliminated to the extent of the Group’s investments in the
associates, except where unrealised losses provide evidence of an impairment of the assets transferred. Goodwill
arising from the acquisition of associates is included as part of the Group’s investments in associates.
If an investment in an associate becomes an investment in a joint venture or vice versa, the retained interest
is not remeasured. Instead, the investment continues to be accounted for under the equity method. In all other cases,
upon loss of significant influence over the associate, the Group measures and recognises any retained investment at
its fair value. Any difference between the carrying amount of the associate upon loss of significant influence and the
fair value of the retained investment and proceeds from disposal is recognised in profit or loss.
Business combinations and goodwill
(i) Business combinations not under common control
Business combinations are accounted for using the acquisition method. The consideration transferred is
measured at the acquisition date fair value which is the sum of the acquisition date fair values of assets transferred
by the Group, liabilities assumed by the Group to the former owners of the acquiree and the equity interests issued
by the Group in exchange for control of the acquiree. For each business combination, the Group elects whether to
measure the non-controlling interests in the acquiree at fair value or at the proportionate share of the acquiree’s
identifiable net assets. All other components of non-controlling interests are measured at fair value. Acquisition-
related costs are expensed as incurred.
The Group determines that it has acquired a business when the acquired set of activities and assets includes
an input and a substantive process that together significantly contribute to the ability to create outputs.
When the Group acquires a business, it assesses the financial assets and liabilities assumed for appropriate
classification and designation in accordance with the contractual terms, economic circumstances and pertinent
conditions as at the acquisition date. This includes the separation of embedded derivatives in host contracts of the
acquiree.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-23 –


--- page 678 ---
Any contingent consideration to be transferred by the acquirer is recognised at fair value at the acquisition
date. Contingent consideration classified as an asset or liability is measured at fair value with changes in fair value
recognised in profit or loss. Contingent consideration that is classified as equity is not remeasured and subsequent
settlement is accounted for within equity.
Goodwill is initially measured at cost, being the excess of the aggregate of the consideration transferred, the
amount recognised for non-controlling interests and any fair value of the Group’s previously held equity interests in
the acquiree over the identifiable assets acquired and liabilities assumed. If the sum of this consideration and other
items is lower than the fair value of the net assets acquired, the difference is, after reassessment, recognised in profit
or loss as a gain on bargain purchase.
After initial recognition, goodwill is measured at cost less any accumulated impairment losses. Goodwill is
tested for impairment annually or more frequently if events or changes in circumstances indicate that the carrying
value may be impaired. The Group performs its annual impairment test of goodwill as at 31 December. For the
purpose of impairment testing, goodwill acquired in a business combination is, from the acquisition date, allocated
to each of the Group’s cash-generating units, or groups of cash-generating units, that are expected to benefit from
the synergies of the combination, irrespective of whether other assets or liabilities of the Group are assigned to those
units or groups of units.
Impairment is determined by assessing the recoverable amount of the cash-generating unit (group of
cash-generating units) to which the goodwill relates. Where the recoverable amount of the cash-generating unit
(group of cash-generating units) is less than the carrying amount, an impairment loss is recognised. An impairment
loss recognised for goodwill is not reversed in a subsequent period.
Where goodwill has been allocated to a cash-generating unit (or group of cash-generating units) and part of
the operation within that unit is disposed of, the goodwill associated with the operation disposed of is included in
the carrying amount of the operation when determining the gain or loss on the disposal. Goodwill disposed of in these
circumstances is measured based on the relative value of the operation disposed of and the portion of the
cash-generating unit retained.
Fair value measurement
The Group measures certain of its financial assets and financial liabilities at fair value at the end of each of
the Relevant Periods. Fair value is the price that would be received to sell an asset or paid to transfer a liability in
an orderly transaction between market participants at the measurement date. The fair value measurement is based on
the presumption that the transaction to sell the asset or transfer the liability takes place either in the principal market
for the asset or liability, or in the absence of a principal market, in the most advantageous market for the asset or
liability. The principal or the most advantageous market must be accessible by the Group. The fair value of an asset
or a liability is measured using the assumptions that market participants would use when pricing the asset or liability,
assuming that market participants act in their economic best interest.
A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate
economic benefits by using the asset in its highest and best use or by selling it to another market participant that
would use the asset in its highest and best use.
The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data
are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of
unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the Historical Financial Information
are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant
to the fair value measurement as a whole:
Level 1 – based on quoted prices (unadjusted) in active markets for identical assets or liabilities
Level 2 – based on valuation techniques for which the lowest level input that is significant to the fair
value measurement is observable, either directly or indirectly
Level 3 – based on valuation techniques for which the lowest level input that is significant to the fair
value measurement is unobservable
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-24 –


--- page 679 ---
For assets and liabilities that are recognised in the Historical Financial Information on a recurring basis, the
Group determines whether transfers have occurred between levels in the hierarchy by reassessing categorisation
(based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each of
the Relevant Periods.
Impairment of non-financial assets
Where an indication of impairment exists, or when annual impairment testing for an asset is required (other
than inventories, deferred tax assets and financial assets), the asset’s recoverable amount is estimated. An asset’s
recoverable amount is the higher of the asset’s or cash-generating unit’s value in use and its fair value less costs of
disposal, and is determined for an individual asset, unless the asset does not generate cash inflows that are largely
independent of those from other assets or groups of assets, in which case the recoverable amount is determined for
the cash-generating unit to which the asset belongs. In testing a cash-generating unit for impairment, a portion of the
carrying amount of a corporate asset (e.g., a headquarters building) is allocated to an individual cash-generating unit
if it can be allocated on a reasonable and consistent basis or, otherwise, to the smallest group of cash-generating units.
An impairment loss is recognised only if the carrying amount of an asset exceeds its recoverable amount. In
assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount
rate that reflects current market assessments of the time value of money and the risks specific to the asset. An
impairment loss is charged to the statement of profit or loss in the period in which it arises in those expense categories
consistent with the function of the impaired asset.
An assessment is made at the end of each of the Relevant Periods as to whether there is an indication that
previously recognised impairment losses may no longer exist or may have decreased. If such an indication exists, the
recoverable amount is estimated. A previously recognised impairment loss of an asset other than goodwill is reversed
only if there has been a change in the estimates used to determine the recoverable amount of that asset, but not to
an amount higher than the carrying amount that would have been determined (net of any depreciation/amortisation)
had no impairment loss been recognised for the asset in prior years. A reversal of such an impairment loss is credited
to the statement of profit or loss in the period in which it arises.
Related parties
A party is considered to be related to the Group if:
(a) the party is a person or a close member of that person’s family and that person:
(i) has control or joint control over the Group;
(ii) has significant influence over the Group; or
(iii) is a member of the key management personnel of the Group or of a parent of the Group;
or
(b) the party is an entity where any of the following conditions applies:
(i) the entity and the Group are members of the same group;
(ii) one entity is an associate or joint venture of the other entity (or of a parent, subsidiary or fellow
subsidiary of the other entity);
(iii) the entity and the Group are joint ventures of the same third party;
(iv) one entity is a joint venture of a third entity and the other entity is an associate of the third entity;
(v) the entity is a post-employment benefit plan for the benefit of employees of either the Group or
an entity related to the Group;
(vi) the entity is controlled or jointly controlled by a person identified in (a);
(vii) a person identified in (a)(i) has significant influence over the entity or is a member of the key
management personnel of the entity (or of a parent of the entity); and
(viii) the entity, or any member of a group of which it is a part, provides key management personnel
services to the Group or to the parent of the Group.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-25 –


--- page 680 ---
Property, plant and equipment and depreciation
Property, plant and equipment, other than construction in progress, are stated at cost less accumulated
depreciation and any impairment losses. The cost of an item of property, plant and equipment comprises its purchase
price and any directly attributable costs of bringing the asset to its working condition and location for its intended
use.
Expenditure incurred after items of property, plant and equipment have been put into operation, such as repairs
and maintenance, is normally charged to profit or loss in the period in which it is incurred. In situations where the
recognition criteria are satisfied, the expenditure for a major inspection is capitalised in the carrying amount of the
asset as a replacement. Where significant parts of property, plant and equipment are required to be replaced at
intervals, the Group recognises such parts as individual assets with specific useful lives and depreciates them
accordingly.
Depending on the nature of the item of property, plant and equipment, depreciation is calculated on the
straight-line basis to write off the cost of each asset to its residual value over its estimated useful life or it is
calculated on the Units of Production (“UOP”) basis to write off the cost of the asset proportionately to the extraction
of the proven and probable mineral reserves. The estimated useful lives and annual depreciation rates for the assets
depreciated on the straight-line basis are as follows:
Estimated useful lives Annual depreciation rates
Buildings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820 years 4.75%
Machinery /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 to 10 years 9.50% to 19.00%
Mobile equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 to 10 years 9.50% to 19.00%
Electronic equipment and others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183 to 5 years 19.00% to 31.67%
Where parts of an item of property, plant and equipment have different useful lives, the cost of that item is
allocated on a reasonable basis among the parts and each part is depreciated separately. Residual values, useful lives
and the depreciation method are reviewed, and adjusted if appropriate, at least at the end of each of the Relevant
Periods.
An item of property, plant and equipment including any significant part initially recognised is derecognised
upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss on disposal
or retirement recognised in the statement of profit or loss in the years/periods the asset is derecognised is the
difference between the net sales proceeds and the carrying amount of the relevant asset.
Construction in progress is stated at cost less any impairment losses, and is not depreciated. Cost comprises
the direct costs of construction and capitalised borrowing costs on related borrowed funds during the period of
construction. Construction in progress is reclassified to the appropriate category of property, plant and equipment
when completed and ready for use.
Other intangible assets
Other intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible
assets acquired in a business combination is the fair value at the date of acquisition. The useful lives of intangible
assets are assessed to be either finite or indefinite. Intangible assets with finite lives are subsequently amortised over
the useful economic life and assessed for impairment whenever there is an indication that the intangible asset may
be impaired. The amortisation period and the amortisation method for an intangible asset with a finite useful life are
reviewed at least at each financial year end.
Patents and licences
Purchased patents and licences are stated at cost less any impairment losses and are amortised on the
straight-line basis over their estimated useful lives of 10 years.
Exploration and mining rights
Exploration and evaluation assets are stated at cost less impairment losses. Exploration and evaluation includes
costs of geological prospecting for technical consultancy and costs of feasibility study for commercial development
which incurred in the surroundings, outer ring and deep areas of the existing or externally acquired mineral
properties, and costs of drilling, trench sampling and other associated activities. Such expenditures may be
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-26 –


--- page 681 ---
capitalized when the mineral properties are reasonably determined to be commercially available and recognized as
intangible assets after obtaining mining rights or permits, which will be amortized under the units-of-production
method. If any construction was abandoned in the development phase, all costs shall be written off and recognized
in profit or loss for the current period.
Impairment reviews of exploration and evaluation assets are undertaken if events or changes in circumstances
indicate a potential impairment. The carrying value of exploration and evaluation assets is compared to the
recoverable amount, which is the higher of value-in-use and the fair value less costs of disposal. For the purposes
of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable
cash-generating units. Exploration and evaluation assets that suffered impairment are reviewed for possible reversal
of the impairment at each reporting date.
Exploration rights are stated at cost less impairment losses. Exploration rights include the cost of acquiring
exploration rights.
Mining rights are stated at cost less accumulated amortisation and any impairment losses. Mining rights
include the cost of acquiring mining licences, exploration rights and exploration and evaluation assets upon
determination that an exploration property is capable of commercial production, and the cost of acquiring interests
in the mining reserves of existing mining properties. The mining rights are amortised in accordance with the
production plans of the entities concerned and the proven and probable mineral reserves of the mines using the UOP
method. Mining rights are written off to profit or loss if the mining property is abandoned.
Research and development expenses
All research expenses are charged to the statement of profit or loss as incurred.
Expenditure incurred on projects to develop new products is capitalised and deferred only when the Group can
demonstrate the technical feasibility of completing the intangible asset so that it will be available for use or sale, its
intention to complete and its ability to use or sell the asset, how the asset will generate future economic benefits, the
availability of resources to complete the project and the ability to measure reliably the expenditure during the
development. Product development expenditure which does not meet these criteria is expensed when incurred.
Deferred development costs are stated at cost less any impairment losses and are amortised using the
straight-line basis over the commercial lives of the underlying products not exceeding five to seven years,
commencing from the date when the products are put into commercial production.
Leases
The Group assesses at contract inception whether a contract is, or contains, a lease. A contract is, or contains,
a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for
consideration.
Group as a lessee
The Group applies a single recognition and measurement approach for all leases, except for short-term leases
and leases of low-value assets. The Group recognises lease liabilities to make lease payments and right-of-use assets
representing the right to use the underlying assets.
(a) Right-of-use assets
Right-of-use assets are recognised at the commencement date of the lease (that is the date the underlying asset
is available for use). Right-of-use assets are measured at cost, less accumulated depreciation and any impairment
losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes the amount
of lease liabilities recognised, initial direct costs incurred, and lease payments made at or before the commencement
date less any lease incentives received. Right-of-use assets are depreciated on a straight-line basis over the shorter
of the lease terms and the estimated useful lives of the assets as follows:
Leasehold land /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111850 years
Buildings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183 to 5 years
Machinery and vehicles /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182 to 5 years
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-27 –


--- page 682 ---
If ownership of the leased asset transfers to the Group by the end of the lease term or the cost reflects the
exercise of a purchase option, depreciation is calculated using the estimated useful life of the asset.
(b) Lease liabilities
Lease liabilities are recognised at the commencement date of the lease at the present value of lease payments
to be made over the lease term. The lease payments include fixed payments (including in-substance fixed payments)
less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts expected
to be paid under residual value guarantees. The lease payments also include the exercise price of a purchase option
reasonably certain to be exercised by the Group and payments of penalties for termination of a lease, if the lease term
reflects the Group exercising the option to terminate the lease. The variable lease payments that do not depend on
an index or a rate are recognised as an expense in the period in which the event or condition that triggers the payment
occurs.
In calculating the present value of lease payments, the Group uses its incremental borrowing rate at the lease
commencement date because the interest rate implicit in the lease is not readily determinable. After the
commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for
the lease payments made. In addition, the carrying amount of lease liabilities is remeasured if there is a modification,
a change in the lease term, a change in lease payments (e.g., a change to future lease payments resulting from a
change in an index or rate) or a change in assessment of an option to purchase the underlying asset.
(c) Short-term leases and leases of low-value assets
The Group applies the short-term lease recognition exemption to its short-term leases of office premises (that
is those leases that have a lease term of 12 months or less from the commencement date and do not contain a purchase
option). It also applies the recognition exemption for leases of low-value assets to leases of office equipment and
laptop computers that are considered to be of low value. Lease payments on short-term leases and leases of low-value
assets are recognised as an expense on a straight-line basis over the lease term.
Group as a lessor
When the Group acts as a lessor, it classifies at lease inception (or when there is a lease modification) each
of its leases as either an operating lease or a finance lease.
Leases in which the Group does not transfer substantially all the risks and rewards incidental to ownership of
an asset are classified as operating leases. When a contract contains lease and non-lease components, the Group
allocates the consideration in the contract to each component on a relative stand-alone selling price basis. Rental
income is accounted for on a straight-line basis over the lease terms and is included in revenue in the statement of
profit or loss due to its operating nature. Initial direct costs incurred in negotiating and arranging an operating lease
are added to the carrying amount of the leased asset and recognised over the lease term on the same basis as rental
income. Contingent rents are recognised as revenue in the period in which they are earned.
Leases that transfer substantially all the risks and rewards incidental to ownership of an underlying asset to
the lessee are accounted for as finance leases.
Investments and other financial assets
Initial recognition and measurement
Financial assets are classified, at initial recognition, as subsequently measured at amortised cost, fair value
through other comprehensive income, and fair value through profit or loss.
The classification of financial assets at initial recognition depends on the financial asset’s contractual cash
flow characteristics and the Group’s business model for managing them. With the exception of trade receivables that
do not contain a significant financing component or for which the Group has applied the practical expedient of not
adjusting the effect of a significant financing component, the Group initially measures a financial asset at its fair
value, plus in the case of a financial asset not at fair value through profit or loss, transaction costs. Trade receivables
that do not contain a significant financing component or for which the Group has applied the practical expedient are
measured at the transaction price determined under IFRS 15 in accordance with the policies set out for “Revenue
recognition” below.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-28 –


--- page 683 ---
In order for a financial asset to be classified and measured at amortised cost or fair value through other
comprehensive income, it needs to give rise to cash flows that are solely payments of principal and interest (“SPPI”)
on the principal amount outstanding. Financial assets with cash flows that are not SPPI are classified and measured
at fair value through profit or loss, irrespective of the business model.
The Group’s business model for managing financial assets refers to how it manages its financial assets in order
to generate cash flows. The business model determines whether cash flows will result from collecting contractual
cash flows, selling the financial assets, or both. Financial assets classified and measured at amortised cost are held
within a business model with the objective to hold financial assets in order to collect contractual cash flows, while
financial assets classified and measured at fair value through other comprehensive income are held within a business
model with the objective of both holding to collect contractual cash flows and selling. Financial assets which are not
held within the aforementioned business models are classified and measured at fair value through profit or loss.
Purchases or sales of financial assets that require delivery of assets within the period generally established by
regulation or convention in the marketplace are recognised on the trade date, that is, the date that the Group commits
to purchase or sell the asset.
Subsequent measurement
The subsequent measurement of financial assets depends on their classification as follows:
Financial assets at amortised cost (debt instruments)
Financial assets at amortised cost are subsequently measured using the effective interest method and are
subject to impairment. Gains and losses are recognised in profit or loss when the asset is derecognised, modified or
impaired.
Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss are carried in the statement of financial position at fair value
with net changes in fair value recognised in the statement of profit or loss.
This category includes derivative instruments and equity investments which the Group had not irrevocably
elected to classify at fair value through other comprehensive income. Dividends on the equity investments are also
recognised as other income in the statement of profit or loss when the right of payment has been established.
A derivative embedded in a hybrid contract, with a financial liability or non-financial host, is separated from
the host and accounted for as a separate derivative if the economic characteristics and risks are not closely related
to the host; a separate instrument with the same terms as the embedded derivative would meet the definition of a
derivative; and the hybrid contract is not measured at fair value through profit or loss. Embedded derivatives are
measured at fair value with changes in fair value recognised in the statement of profit or loss. Reassessment only
occurs if there is either a change in the terms of the contract that significantly modifies the cash flows that would
otherwise be required or a reclassification of a financial asset out of the fair value through profit or loss category.
A derivative embedded within a hybrid contract containing a financial asset host is not accounted for
separately. The financial asset host together with the embedded derivative is required to be classified in its entirety
as a financial asset at fair value through profit or loss.
Derecognition of financial assets
A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets)
is primarily derecognised (i.e., removed from the Group’s consolidated statements of financial position) when:
 the rights to receive cash flows from the asset have expired; or
 the Group has transferred its rights to receive cash flows from the asset or has assumed an obligation
to pay the received cash flows in full without material delay to a third party under a “pass-through”
arrangement; and either (a) the Group has transferred substantially all the risks and rewards of the asset,
or (b) the Group has neither transferred nor retained substantially all the risks and rewards of the asset,
but has transferred control of the asset.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-29 –


--- page 684 ---
When the Group has transferred its rights to receive cash flows from an asset or has entered into a pass-through
arrangement, it evaluates if, and to what extent, it has retained the risk and rewards of ownership of the asset. When
it has neither transferred nor retained substantially all the risks and rewards of the asset nor transferred control of
the asset, the Group continues to recognise the transferred asset to the extent of the Group’s continuing involvement.
In that case, the Group also recognises an associated liability. The transferred asset and the associated liability are
measured on a basis that reflects the rights and obligations that the Group has retained.
Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower
of the original carrying amount of the asset and the maximum amount of consideration that the Group could be
required to repay.
Impairment of financial assets
The Group recognises an allowance for expected credit losses (“ECLs”) for all debt instruments not held at fair
value through profit or loss. ECLs are based on the difference between the contractual cash flows due in accordance
with the contract and all the cash flows that the Group expects to receive, discounted at an approximation of the
original effective interest rate. The expected cash flows will include cash flows from the sale of collateral held or
other credit enhancements that are integral to the contractual terms.
General approach
ECLs are recognised in two stages. For credit exposures for which there has not been a significant increase
in credit risk since initial recognition, ECLs are provided for credit losses that result from default events that are
possible within the next 12 months (a 12-month ECL). For those credit exposures for which there has been a
significant increase in credit risk since initial recognition, a loss allowance is required for credit losses expected over
the remaining life of the exposure, irrespective of the timing of the default (a lifetime ECL).
At each reporting date, the Group assesses whether the credit risk on a financial instrument has increased
significantly since initial recognition. When making the assessment, the Group compares the risk of a default
occurring on the financial instrument as at the reporting date with the risk of a default occurring on the financial
instrument as at the date of initial recognition and considers reasonable and supportable information that is available
without undue cost or effort, including historical and forward-looking information.
The Group considers a financial asset in default when contractual payments are 90 days past due. However,
in certain cases, the Group may also consider a financial asset to be in default when internal or external information
indicates that the Group is unlikely to receive the outstanding contractual amounts in full before taking into account
any credit enhancements held by the Group.
A financial asset is written off when there is no reasonable expectation of recovering the contractual cash
flows.
Financial assets at amortised cost are subject to impairment under the general approach and they are classified
within the following stages for measurement of ECLs except for trade receivables which apply the simplified
approach as detailed below.
Stage 1 – Financial instruments for which credit risk has not increased significantly since initial
recognition and for which the loss allowance is measured at an amount equal to 12-month
ECLs;
Stage 2 – Financial instruments for which credit risk has increased significantly since initial
recognition but that are not credit-impaired financial assets and for which the loss
allowance is measured at an amount equal to lifetime ECLs;
Stage 3 – Financial assets that are credit-impaired at the reporting date (but that are not purchased
or originated credit-impaired) and for which the loss allowance is measured at an amount
equal to lifetime ECLs.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-30 –


--- page 685 ---
Simplified approach
For trade receivables that do not contain a significant financing component or when the Group applies the
practical expedient of not adjusting the effect of a significant financing component, the Group applies the simplified
approach in calculating ECLs. Under the simplified approach, the Group does not track changes in credit risk, but
instead recognises a loss allowance based on lifetime ECLs at each reporting date. The Group has established a
provision matrix that is based on its historical credit loss experience, adjusted for forward-looking factors specific
to the debtors and the economic environment.
Financial liabilities
Initial recognition and measurement
Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or
loss, loans and borrowings, or payables, as appropriate.
All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings and
payables, net of directly attributable transaction costs.
The Group’s financial liabilities include trade and notes payables, financial liabilities at fair value through
profit or loss, other payables and accruals, other non-current liabilities and loans.
Subsequent measurement
The subsequent measurement of financial liabilities depends on their classification as follows:
Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial
liabilities designated upon initial recognition as at fair value through profit or loss.
Financial liabilities are classified as held for trading if they are incurred for the purpose of repurchasing in the
near term. This category also includes derivative financial instruments entered into by the Group that are not
designated as hedging instruments in hedge relationships as defined by IFRS 9. Separated embedded derivatives are
also classified as held for trading unless they are designated as effective hedging instruments. Gains or losses on
liabilities held for trading are recognised in the statement of profit or loss.
Financial liabilities designated upon initial recognition as at fair value through profit or loss are designated at
the initial date of recognition, and only if the criteria in IFRS 9 are satisfied. Gains or losses on liabilities designated
at fair value through profit or loss are recognised in the statement of profit or loss, except for the gains or losses
arising from the Group’s own credit risk which are presented in other comprehensive income with no subsequent
reclassification to the statement of profit or loss. The net fair value gain or loss recognised in the statement of profit
or loss does not include any interest charged on these financial liabilities.
Financial liabilities at amortised cost (trade and notes payables, other payables and accruals and loans)
After initial recognition, payables and loans are subsequently measured at amortised cost, using the effective
interest rate method unless the effect of discounting would be immaterial, in which case they are stated at cost. Gains
and losses are recognised in profit or loss when the liabilities are derecognised as well as through the effective
interest rate amortisation process.
Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs
that are an integral part of the effective interest rate. The effective interest rate amortisation is included in finance
costs in profit or loss.
Derecognition of financial liabilities
A financial liability is derecognised when the obligation under the liability is discharged or cancelled, or
expires.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-31 –


--- page 686 ---
When an existing financial liability is replaced by another from the same lender on substantially different
terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as
a derecognition of the original liability and a recognition of a new liability, and the difference between the respective
carrying amounts is recognised in profit or loss.
Offsetting of financial instruments
Financial assets and financial liabilities are offset and the net amount is reported in the statement of financial
position if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to
settle on a net basis, or to realise the assets and settle the liabilities simultaneously.
Derivative financial instruments and hedge accounting
Initial recognition and subsequent measurement
The Group uses derivative financial instruments, such as commodity futures, to hedge its price fluctuation risk.
Such derivative financial instruments are initially recognised at fair value on the date on which a derivative contract
is entered into and are subsequently remeasured at fair value. Derivatives are carried as assets when the fair value
is positive and as liabilities when the fair value is negative.
Any gains or losses arising from changes in fair value of derivatives are taken directly to the statement of profit
or loss, except for the effective portion of cash flow hedges, which is recognised in other comprehensive income and
later reclassified to profit or loss when the hedged item affects profit or loss.
For the purpose of hedge accounting, hedges are classified as:
 fair value hedges when hedging the exposure to changes in the fair value of a recognised asset or
liability or an unrecognised firm commitment; or
 cash flow hedges when hedging the exposure to variability in cash flows that is either attributable to a
particular risk associated with a recognised asset or liability or a highly probable forecast transaction,
or a foreign currency risk in an unrecognised firm commitment.
At the inception of a hedge relationship, the Group formally designates and documents the hedge relationship
to which the Group wishes to apply hedge accounting, the risk management objective and its strategy for undertaking
the hedge.
The documentation includes identification of the hedging instrument, the hedged item, the nature of the risk
being hedged and how the Group will assess whether the hedging relationship meets the hedge effectiveness
requirements (including the analysis of sources of hedge ineffectiveness and how the hedge ratio is determined). A
hedging relationship qualifies for hedge accounting if it meets all of the following effectiveness requirements:
 There is “an economic relationship” between the hedged item and the hedging instrument.
 The effect of credit risk does not “dominate the value changes” that result from that economic
relationship.
 The hedge ratio of the hedging relationship is the same as that resulting from the quantity of the hedged
item that the Group actually hedges and the quantity of the hedging instrument that the Group actually
uses to hedge that quantity of hedged item.
Hedges which meet all the qualifying criteria for hedge accounting are accounted for as follows:
Cash flow hedges
The effective portion of the gain or loss on the hedging instrument is recognised directly in other
comprehensive income in the cash flow hedge reserve, while any ineffective portion is recognised immediately in the
statement of profit or loss. The cash flow hedge reserve is adjusted to the lower of the cumulative gain or loss on
the hedging instrument and the cumulative change in fair value of the hedged item.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-32 –


--- page 687 ---
The amounts accumulated in other comprehensive income are accounted for, depending on the nature of the
underlying hedged transaction. If the hedged transaction subsequently results in the recognition of a non-financial
item, the amount accumulated in equity is removed from the separate component of equity and included in the initial
cost or other carrying amount of the hedged asset or liability. This is not a reclassification adjustment and will not
be recognised in other comprehensive income for the period. This also applies where the hedged forecast transaction
of a non-financial asset or non-financial liability subsequently becomes a firm commitment to which fair value hedge
accounting is applied.
For any other cash flow hedges, the amount accumulated in other comprehensive income is reclassified to the
statement of profit or loss as a reclassification adjustment in the same period or periods during which the hedged cash
flows affect the statement of profit or loss.
If cash flow hedge accounting is discontinued, the amount that has been accumulated in other comprehensive
income must remain in accumulated other comprehensive income if the hedged future cash flows are still expected
to occur. Otherwise, the amount will be immediately reclassified to the statement of profit or loss as a reclassification
adjustment. After the discontinuation, once the hedged cash flow occurs, any amount remaining in accumulated other
comprehensive income is accounted for depending on the nature of the underlying transaction as described above.
Treasury shares
Own equity instruments which are reacquired and held by the Company or the Group (treasury shares) are
recognised directly in equity at cost. No gain or loss is recognised in the statement of profit or loss on the purchase,
sale, issue or cancellation of the Group’s own equity instruments.
Inventories
Inventories are stated at the lower of cost and net realisable value. Cost is determined on the weighted average
basis and, in the case of work in progress and finished goods, comprises direct materials, direct labour and an
appropriate proportion of overheads. Net realisable value is based on estimated selling prices less any estimated costs
to be incurred to completion and disposal.
Cash and cash equivalents
Cash and cash equivalents in the statement of financial position comprise cash on hand and at banks, and
short-term highly liquid deposits with a maturity of generally within three months that are readily convertible into
known amounts of cash, subject to an insignificant risk of changes in value and held for the purpose of meeting
short-term cash commitments.
For the purpose of the consolidated statement of cash flows, cash and cash equivalents comprise cash on hand
and at banks, including term deposits, and assets similar in nature to cash, which are not restricted as to use.
Provisions
A provision is recognised when a present obligation (legal or constructive) has arisen as a result of a past event
and it is probable that a future outflow of resources will be required to settle the obligation, provided that a reliable
estimate can be made of the amount of the obligation.
When the effect of discounting is material, the amount recognised for a provision is the present value at the
end of each of the Relevant Periods of the future expenditures expected to be required to settle the obligation. The
increase in the discounted present value amount arising from the passage of time is included in finance costs in profit
or loss.
Provisions for the Group’s obligations for environmental rehabilitation and restoration of mines are based on
estimates of required expenditure at the mines in accordance with the local rules and regulations where the mines are
located. The Group estimates its liabilities for final reclamation and mine closure based upon detailed calculations
of the amount and timing of the future cash expenditure for the required work. Spending estimates are escalated for
inflation, then discounted at a discount rate that reflects current market assessments of the time value of money and
the risks specific to the liability such that the amount of provision reflects the present value of the expenditures
expected to be required to settle the obligation. The Group records a corresponding asset in the period in which the
liability is incurred. The liability is accreted to the projected expenditure date. As changes in estimates occur (such
as mine plan revisions, changes in estimated costs, or changes in the timing of the performance of reclamation
activities), the revisions to the obligation and the asset are recognised at the appropriate discount rate.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-33 –


--- page 688 ---
Income tax
Income tax comprises current and deferred tax. Income tax relating to items recognised outside profit or loss
is recognised outside profit or loss, either in other comprehensive income or directly in equity.
Current tax assets and liabilities are measured at the amount expected to be recovered from or paid to the
taxation authorities, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of
each of the Relevant Periods, taking into consideration interpretations and practices prevailing in the countries in
which the Group operates.
Deferred tax is provided, using the liability method, on all temporary differences at the end of each of the
Relevant Periods between the tax bases of assets and liabilities and their carrying amounts for financial reporting
purposes.
Deferred tax liabilities are recognised for all taxable temporary differences, except:
 when the deferred tax liability arises from the initial recognition of goodwill or an asset or liability in
a transaction that is not a business combination and, at the time of the transaction, affects neither the
accounting profit nor taxable profit or loss and does not give rise to equal taxable and deductible
temporary differences; and
 in respect of taxable temporary differences associated with investments in subsidiaries and associates,
when the timing of the reversal of the temporary differences can be controlled and it is probable that
the temporary differences will not reverse in the foreseeable future.
Deferred tax assets are recognised for all deductible temporary differences, and the carryforward of unused tax
credits and any unused tax losses. Deferred tax assets are recognised to the extent that it is probable that taxable profit
will be available against which the deductible temporary differences, and the carryforward of unused tax credits and
unused tax losses can be utilised, except:
 when the deferred tax asset relating to the deductible temporary differences arises from the initial
recognition of an asset or liability in a transaction that is not a business combination and, at the time
of the transaction, affects neither the accounting profit nor taxable profit or loss and does not give rise
to equal taxable and deductible temporary differences; and
 in respect of deductible temporary differences associated with investments in subsidiaries and
associates, deferred tax assets are only recognised to the extent that it is probable that the temporary
differences will reverse in the foreseeable future and taxable profit will be available against which the
temporary differences can be utilised.
The carrying amount of deferred tax assets is reviewed at the end of each of the Relevant Periods and reduced
to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the
deferred tax asset to be utilised. Unrecognised deferred tax assets are reassessed at the end of each of the Relevant
Periods and are recognised to the extent that it has become probable that sufficient taxable profit will be available
to allow all or part of the deferred tax asset to be recovered.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period when
the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively
enacted by the end of each of the Relevant Periods.
Deferred tax assets and deferred tax liabilities are offset if and only if the Group has a legally enforceable right
to set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax liabilities relate to
income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities which
intend either to settle current tax liabilities and assets on a net basis, or to realise the assets and settle the liabilities
simultaneously, in each future period in which significant amounts of deferred tax liabilities or assets are expected
to be settled or recovered.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-34 –


--- page 689 ---
Government grants
Government grants are recognised at their fair value where there is reasonable assurance that the grant will be
received and all attaching conditions will be complied with. When the grant relates to an expense item, it is
recognised as income on a systematic basis over the periods that the costs, for which it is intended to compensate,
are expensed.
Where the grant relates to an asset, the fair value is credited to a deferred income account and is released to
profit or loss over the expected useful life of the relevant asset by equal annual instalments.
Revenue recognition
Revenue from contracts with customers
Revenue from contracts with customers is recognised when control of goods or services is transferred to the
customers at an amount that reflects the consideration to which the Group expects to be entitled in exchange for those
goods or services.
When the contract contains a financing component which provides the customer with a significant benefit of
financing the transfer of goods or services to the customer for more than one year, revenue is measured at the present
value of the amount receivable, discounted using the discount rate that would be reflected in a separate financing
transaction between the Group and the customer at contract inception. When the contract contains a financing
component which provides the Group with a significant financial benefit for more than one year, revenue recognised
under the contract includes the interest expense accreted on the contract liability under the effective interest method.
For a contract where the period between the payment by the customer and the transfer of the promised goods or
services is one year or less, the transaction price is not adjusted for the effects of a significant financing component,
using the practical expedient in IFRS 15.
Sale of products
Revenue from the sale of products is recognised at the point in time when control of the asset is transferred
to the customer, generally on delivery of the products.
Metal streaming arrangement
There is a Metal Streaming Arrangement in GSR acquired by the Group in 2022. Under the business
arrangement, GSR receives a payment in advance and the counterparty obtains a certain proportion of deliverable
gold within the entire life of the designated mine. The counterparty is also required to make an additional payment
based on a certain proportion of the market price when GSR delivers the goods within an agreed period in the future.
The payment GSR receives in advance is considered to be part of the counterparty’s prepayment for the future goods
with uncertain but predictable quantity, and is recognised as a contract liability upon receipt. Each unit of the
delivered goods represents a separate performance obligation, and revenue is recognised at the point in time when
control of the goods is transferred. Considering the timing of satisfaction of delivery obligations throughout the entire
life of the mines, the contract liability above is considered to have significant financing components. In addition,
because the quantity of all delivered goods available to the counterparty depends on the mining reserves of the metals
throughout the entire life of the mines, the management will estimate the change of total metal reserves and change
of planned mining reserves on a regular basis and adjustments shall be made to the revenue and finance costs
accordingly.
V ariable consideration
In the Group’s Metal Streaming Arrangement, because the quantity of all delivered goods available to the
counterparty depends on the mining reserves of the metals throughout the entire life of the mines, the price allocated
to goods delivered per unit is considered as variable consideration. When the estimated total metal reserves and
planned exploitation reserves of the mine change, it is necessary to recalculate the price of goods delivered per unit,
and in the period of changes occurred, adjust the revenue and finance costs recognised in the same period according
to the updated price. The Group determines the best estimate of variable consideration by the expected value. The
transaction price including variable consideration is only to the extent that it is highly probable that a significant
reversal in the amount of cumulative revenue recognised will not occur when the uncertainty associated with the
variable consideration is subsequently resolved.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-35 –


--- page 690 ---
Contracts for the rendering of services
A contract for the rendering of services between the Group and the customer usually includes performance
obligations of dismantling waste electronic products and electrical appliances. The Group recognises the fund subsidy
income, which was related to the dismantling volume, as a part of revenue by multiplying the dismantling type and
quantity of the scrapped electrical and electronic products by the corresponding fund subsidy price.
Revenue from other sources
Rental income is recognised on a time proportion basis over the lease terms. V ariable lease payments that do
not depend on an index or a rate are recognised as income in the accounting period in which they are incurred.
Other income
Interest income is recognised on an accrual basis using the effective interest method by applying the rate that
exactly discounts the estimated future cash receipts over the expected life of the financial instrument or a shorter
period, when appropriate, to the net carrying amount of the financial asset.
Contract liabilities
A contract liability is recognised when a payment is received or a payment is due (whichever is earlier) from
a customer before the Group transfers the related goods or services. Contract liabilities are recognised as revenue
when the Group performs under the contract (i.e., transfers control of the related goods or services to the customer).
Share incentive plan
The Company operates employee stock ownership plans. Employees (including directors) of the Group receive
remuneration in the form of share-based payments, whereby employees render services in exchange for equity
instruments (“equity-settled transactions”). The cost of equity-settled transactions with employees is measured by
reference to the fair value at the date at which they are granted. The fair value is determined by the market price of
the granted shares, further details of which are given in note 40 to the Historical Financial Information.
The cost of equity-settled transactions is recognised in employee benefit expense, together with a
corresponding increase in equity, over the period in which the performance and/or service conditions are fulfilled.
The cumulative expense recognised for equity-settled transactions at the end of each reporting period until the vesting
date reflects the extent to which the vesting period has expired and the Group’s best estimate of the number of equity
instruments that will ultimately vest. The charge or credit to the statement of profit or loss for a period represents
the movement in the cumulative expense recognised as at the beginning and end of that period.
Service and non-market performance conditions are not taken into account when determining the grant date
fair value of awards, but the likelihood of the conditions being met is assessed as part of the Group’s best estimate
of the number of equity instruments that will ultimately vest. Market performance conditions are reflected within the
grant date fair value. Any other conditions attached to an award, but without an associated service requirement, are
considered to be non-vesting conditions. Non-vesting conditions are reflected in the fair value of an award and lead
to an immediate expensing of an award unless there are also service and/or performance conditions.
For awards that do not ultimately vest because non-market performance and/or service conditions have not
been met, no expense is recognised. Where awards include a market or non-vesting condition, the transactions are
treated as vesting irrespective of whether the market or non-vesting condition is satisfied, provided that all other
performance and/or service conditions are satisfied.
Where the terms of an equity-settled award are modified, as a minimum an expense is recognised as if the
terms had not been modified, if the original terms of the award are met. In addition, an expense is recognised for any
modification that increases the total fair value of the share-based payments, or is otherwise beneficial to the employee
as measured at the date of modification. Where an equity-settled award is cancelled, it is treated as if it had vested
on the date of cancellation, and any expense not yet recognised for the award is recognised immediately.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-36 –


--- page 691 ---
Other employee benefits
Pension schemes
In accordance with applicable PRC regulations, the Company and its subsidiaries operating in Chinese
Mainland have currently enrolled in a series of pension schemes regulated by various provincial and municipal
governments, under which each of the entities operating in Chinese Mainland is required to contribute a percentage
of its employees’ salaries to the pension fund. The contributions are charged to profit or loss as they become payable
in accordance with the rules of the pension schemes.
Subsidiaries of the Group in Wassa and Laos operates defined contribution plans on behalf of its employees.
The contributions are recognised as employee benefit expense (staff costs) when they are due.
Termination benefits
The employees of the Group participate in a pension scheme and unemployment insurance managed by the
local government, and the corresponding expenses shall be included in the cost of related assets or profit or loss.
The Group recognises a liability for termination benefits and charges to profit or loss for the current period
at the earlier of the following dates: when the Group can no longer withdraw the offer of those benefits resulting from
the termination plan or the redundancy offer unilaterally; or when the Group recognises costs or expense for a
restructuring plan which involves the payment of termination benefits.
The internal retirement plan of employees shall be treated in the same principle as the above termination
benefits. The Group will include the salaries and social insurance premiums to be paid for early retirees during the
period from the date when employees stop providing services to the normal retirement date into the current profit or
loss (termination benefits) when the conditions for recognition of provisions are met.
Borrowing costs
Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, i.e.,
assets that necessarily take a substantial period of time to get ready for their intended use or sale, are capitalised as
part of the cost of those assets. The capitalisation of such borrowing costs ceases when the assets are substantially
ready for their intended use or sale. All other borrowing costs are expensed in the period in which they are incurred.
Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds.
Dividends
Final dividends are recognised as a liability when they are approved by the shareholders in a general meeting.
The proposed final dividends are disclosed in the note 16 to the Historical Financial Information.
Foreign currencies
The Historical Financial Information is presented in Renminbi, which is the Company’s functional currency.
Each entity in the Group determines its own functional currency and items included in the financial statements of
each entity are measured using that functional currency. Foreign currency transactions recorded by the entities in the
Group are initially recorded using their respective functional currency rates prevailing at the dates of the transactions.
Monetary assets and liabilities denominated in foreign currencies are translated at the functional currency rates of
exchange ruling at the end of each of the Relevant Periods. Differences arising on settlement or translation of
monetary items are recognised in profit or loss.
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the
exchange rates at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign currency
are translated using the exchange rates at the date when the fair value was measured. The gain or loss arising on
translation of a non-monetary item measured at fair value is treated in line with the recognition of the gain or loss
on change in fair value of the item (i.e., translation difference on the item whose fair value gain or loss is recognised
in other comprehensive income or profit or loss is also recognised in other comprehensive income or profit or loss,
respectively).
In determining the exchange rate on initial recognition of the related asset, expense or income on the
derecognition of a non-monetary asset or non-monetary liability relating to an advance consideration, the date of
initial transaction is the date on which the Group initially recognises the non-monetary asset or non-monetary liability
arising from the advance consideration. If there are multiple payments or receipts in advance, the Group determines
the transaction date for each payment or receipt of the advance consideration.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-37 –


--- page 692 ---
The functional currencies of certain overseas subsidiaries and associates are currencies other than the RMB.
As at the end of the reporting period, the assets and liabilities of these entities are translated into RMB at the
exchange rates prevailing at the end of the reporting period and their statements of profit or loss are translated into
RMB at the exchange rates that approximate to those prevailing at the dates of the transactions.
The resulting exchange differences are recognised in other comprehensive income and accumulated in the
exchange fluctuation reserve, except to the extent that the differences are attributable to non-controlling interests. On
disposal of a foreign operation, the cumulative amount in the reserve relating to that particular foreign operation is
recognised in the statement of profit or loss.
For the purpose of the consolidated statement of cash flows, the cash flows of overseas subsidiaries are
translated into RMB at the exchange rates ruling at the dates of the cash flows. Frequently recurring cash flows of
overseas subsidiaries which arise throughout the year are translated into RMB at the weighted average exchange rates
for the year.
5. SIGNIFICANT ACCOUNTING JUDGEMENTS AND ESTIMATES
The preparation of the Group’s Historical Financial Information requires management to make judgements,
estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the
disclosure of contingent liabilities at the end of each of the Relevant Periods. Uncertainty about these estimates and
assumptions could result in outcomes that could require a material adjustment to the carrying amount of the asset or
liability affected in the future.
Judgements
In the process of applying the Group’s accounting policies, management has made the following judgements
which have the most significant effects on the amounts recognised in the financial statements:
Corporate income tax
As a result of the fact that certain matters relating to the corporate income taxes have not been confirmed by
the local tax bureau as at the end of the Relevant Periods, objective estimates based on currently enacted tax laws,
regulations and other related policies are required in determining the provision for corporate income tax expenses to
be made for the reporting period. Where the final tax outcome of these matters is different from the amounts
originally recorded, the differences will be accounted for in the income tax expenses in the period in which the
differences are realised.
Exploration expenditures
After determining the capitalisation amount of exploration expenditures, the Group will regularly evaluate the
exploration results. If the reviewed geological exploration report shows that there are no prospecting results or no
economically recoverable reserves, or that the economic benefits of mining cannot be achieved and further
exploration is unnecessary due to low grade and hard-to-mining, the exploration and development costs previously
collected will be expensed and included in profit or loss for the current period in a lump sum.
Estimation uncertainty
The key assumptions concerning the future and other key sources of estimation uncertainty at the balance sheet
date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities
within the future accounting periods, are described below.
Impairment of financial assets
The Group has adopted the expected credit loss model to evaluate the impairment of financial assets. The
application of the expected credit loss model requires significant judgements and estimates and the consideration of
all reasonable and soundly based information, including forward-looking information. In making such judgements
and estimates, the Group estimates the projected movements of the debtor’s credit risk according to past repayment
records, economic policies, macro-economic indicators and industry risks, etc. Different estimates may affect the
impairment provision, and the amount of impairment provision may not equal to the actual amount of impairment loss
in the future.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-38 –


--- page 693 ---
Impairment of non-current assets other than financial assets (excluding goodwill)
The Group assesses whether there are any indicators of impairment for non-current assets other than financial
assets at the end of the reporting period. Intangible assets with indefinite useful lives are tested for impairment
annually and at other times when such an indicator exists. Other non-current assets other than financial assets are
tested for impairment when there are indicators that the carrying amounts may not be recoverable. An impairment
exists when the carrying value of an asset or asset group exceeds its recoverable amount, which is the higher of its
fair value less costs of disposal and its value in use The calculation of the fair value less costs of disposal based on
available data from binding sales transactions in an arm’s length transaction of similar assets or observable market
prices less incremental costs for disposing of the asset. When value in use calculations are undertaken, management
must estimate the expected future cash flows from the asset or asset group and choose a suitable discount rate in order
to calculate the present value of those cash flows. These estimates and judgements may be significantly affected by
changes in future market or economic conditions.
Impairment of goodwill
The Group determines whether goodwill is impaired at least on an annual basis. This requires an estimation
of the value in use of the cash-generating units to which the goodwill is allocated. Estimating the value in use requires
the Group to make an estimate of the expected future cash flows from the cash-generating units and also to choose
a suitable discount rate in order to calculate the present value of those cash flows. Further details are included in note
20 to the Historical Financial Information.
Proved mineral reserves
Proved mineral reserves are estimated based on professional knowledge, experience and industry practice.
Generally, the mineral reserve volume estimated based on probing and estimation may not be very accurate. The
estimation is updated in accordance with new technologies and new information. Any changes in estimation will have
impacts on the amounts of mining assets’ depreciation and mining rights’ amortisation using the units-of-production
method, on the stripping ratio which was used in the capitalisation of stripping costs, and on each of the transaction
prices of the metal streaming arrangement, etc. This may result in changes of or impacts on the Group’s development
and operation plan, and hence the Group’s operations and operating results.
Deferred tax assets
To the extent that it is probable that there are sufficient taxable profits to offset the deductible losses, deferred
tax assets shall be recognised for all unused deductible losses. Substantial management’s judgements regarding the
timing, amount of future taxable profit as well as tax planning strategies are needed when estimating the amount of
deferred tax assets. Further details are included in note 22 to the Historical Financial Information.
Provision for environmental rehabilitation and restoration of mines
Pursuant to the regulations of the governmental authorities in the places where the mines are located, the Group
recognises provision for environmental rehabilitation and restoration of mines. The amount of provision is an
estimate based upon the life of mining rights, timing of mine closure and cost of such rehabilitation. When this
estimate changes, it may affect the Group’s operations and performance. Further details are included in note 37 to
the Historical Financial Information.
6. SEGMENT INFORMATION
The directors and certain senior managers of the Company (hereinafter referred to as “senior management”)
perform the functions of principal operating decision makers. Senior management reviews the internal reports of the
Group to evaluate the performance of operating segments and allocate resources. The Company determines its
operating segments based on such internal reporting.
The Company’s operating segments include the PRC mining segment, the overseas mining segment and the
other segment. The PRC mining segment conducts the mining and processing of gold and non-ferrous metals in
Mainland China. The overseas mining segment conducts the mining and processing of gold and non-ferrous metals
in Laos, Ghana and other countries/regions. The other segment is mainly engaged in comprehensive resource
recycling and rental income in Mainland China.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-39 –


--- page 694 ---
The senior management monitors the results of its operating segments separately for the purpose of making
decisions about resource allocation and performance assessment. Segment performance is evaluated based on
reportable segment profit, which is a measure of adjusted operating profit before tax. The adjusted operating profit
before tax is measured consistently with the Group’s operating profit before tax except that head office and corporate
expenses are excluded from such measurement.
Segment assets exclude cash and cash equivalents, deferred tax assets, financial assets at fair value through
profit or loss, derivative financial instruments and other unallocated head office and corporate assets as these assets
are managed on a group basis.
Segment liabilities exclude financial liabilities at fair value through profit or loss, derivative financial
instruments, loans, deferred tax liabilities, tax payable and other unallocated head office and corporate liabilities as
these liabilities are managed on a group basis.
Set out below is the disaggregation of the segment information:
Y ear ended 31 December 2021
Y ear ended 31 December 2021 PRC mining Overseas mining Other Total
RMB’000 RMB’000 RMB’000 RMB’000
Segment revenue
Sales to external customers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,001,475 2,522,936 258,213 3,782,624
Intersegment sales /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 71 71
Total segment revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,001,475 2,522,936 258,284 3,782,695
Reconciliation :
Elimination of intersegment sales /H1118/H1118/H1118/H1118/H1118 (71)
Revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,782,624
Segment results /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118363,559 324,353 33,473 721,385
Reconciliation :
Interest income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 20,439
Corporate and other unallocated gains /H1118/H1118 42,777
Finance costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 (14,226)
Profit before tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 770,375
Y ear ended 31 December 2021 PRC mining
Overseas
mining Other Unallocated Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Other segment information
Share of losses of:
Associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – (11) (11)
Write-down of inventories to net
realisable value /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(51) (190,948) (616) – (191,615)
Impairment losses on financial
assets, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,802) – (154) (28) (1,984)
Depreciation and amortisation /H1118/H1118(105,987) (656,577) (14,108) (2,658) (779,330)
Income tax expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(25,444) (127,386) (4,137) – (156,967)
Investments in associates /H1118/H1118/H1118/H1118/H1118– – – 1,989 1,989
Capital expenditure* /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118617,985 935,503 4,939 1,440 1,559,867
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-40 –


--- page 695 ---
The capital expenditure information above is based on the increase in property, plant and equipment,
right-of-use assets, other intangible assets, and long-term prepaid expenses during the relevant periods.
Y ear ended 31 December 2021 PRC mining Overseas mining Other Total
RMB’000 RMB’000 RMB’000 RMB’000
Segment assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,194,683 3,513,742 418,618 6,127,043
Reconciliation :
Corporate and other unallocated assets /H1118/H1118 78,926
Restricted cash /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 116,881
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 1,707,868
Financial assets at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 11,237
Derivative financial assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 6,436
Deferred tax assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 5,215
Total assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,053,606
Segment liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118284,180 2,082,400 10,903 2,377,483
Reconciliation :
Corporate and other unallocated
liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 155,694
Financial liabilities at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 387,683
Derivative financial liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118 1,831
Income tax payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 102,438
Current portion of long-term loans /H1118/H1118/H1118/H1118 25,530
Deferred tax liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 1,916
Total liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 3,052,575
Y ear ended 31 December 2022
Y ear ended 31 December 2022 PRC mining Overseas mining Other Total
RMB’000 RMB’000 RMB’000 RMB’000
Segment revenue
Sales to external customers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,170,861 4,789,316 306,610 6,266,787
Intersegment sales /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 9,717 9,717
Total segment revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,170,861 4,789,316 316,327 6,276,504
Reconciliation :
Elimination of intersegment sales /H1118/H1118/H1118/H1118/H1118 (9,717)
Revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,266,787
Segment results /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118382,772 503,129 25,509 911,410
Reconciliation :
Interest income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 28,097
Corporate and other unallocated gains /H1118/H1118 58,990
Finance costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 (176,485)
Profit before tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 822,012
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-41 –


--- page 696 ---
Y ear ended 31 December 2022 PRC mining
Overseas
mining Other Unallocated Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Other segment information
Share of losses of:
Associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(8) (3,836) – (260) (4,104)
Reversal/(Write-down) of
inventories to net realisable
value /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118673 (40,993) (1,403) – (41,723)
Reversal of impairment/
(impairment losses) on
financial assets, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118(170) – (494) 20 (644)
Depreciation and amortisation /H1118/H1118(145,786) (1,213,843) (7,573) (8,285) (1,375,487)
Income tax expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(49,202) (276,586) (2,344) – (328,132)
Investments in associates /H1118/H1118/H1118/H1118/H1118628 355,462 – 1,729 357,819
Capital expenditure* /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118486,224 1,402,366 347 14,159 1,903,096
The capital expenditure information above is based on the increase in property, plant and equipment,
right-of-use assets, other intangible assets, and long-term prepaid expenses during the Relevant Periods.
Y ear ended 31 December 2022 PRC mining Overseas mining Other Total
RMB’000 RMB’000 RMB’000 RMB’000
Segment assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,467,283 13,174,760 446,758 16,088,801
Reconciliation :
Corporate and other unallocated assets /H1118/H1118 67,695
Restricted cash /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 232,560
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 1,052,545
Financial assets at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 48,131
Derivative financial assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 584
Deferred tax assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 53,978
Total assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111817,544,294
Segment liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118579,776 3,523,030 18,578 4,121,384
Reconciliation :
Corporate and other unallocated
liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 425,334
Short-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 488,409
Financial liabilities at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 620,250
Income tax payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 177,082
Long-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 1,513,781
Current portion of long-term loans /H1118/H1118/H1118/H1118 333,770
Deferred tax liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 2,455,981
Total liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 10,135,991
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-42 –


--- page 697 ---
Y ear ended 31 December 2023
Y ear ended 31 December 2023 PRC mining Overseas mining Other Total
RMB’000 RMB’000 RMB’000 RMB’000
Segment revenue
Sales to external customers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,627,692 5,194,119 399,141 7,220,952
Intersegment sales /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 56,704 56,704
Total segment revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,627,692 5,194,119 455,845 7,277,656
Reconciliation :
Elimination of intersegment sales /H1118/H1118/H1118/H1118/H1118 (56,704)
Revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187,220,952
Segment results /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118749,200 612,493 23,611 1,385,304
Reconciliation :
Interest income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 26,322
Corporate and other unallocated
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 10,195
Finance costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 (215,026)
Profit before tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 1,206,795
Y ear ended 31 December 2023 PRC mining
Overseas
mining Other Unallocated Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Other segment information
Share of profits and (losses) of
Associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 10,134 – (184) 9,950
Reversal/(Write-down) of
inventories to net realisable
value /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(10,185) 7,593 (924) – (3,516)
Reversal of impairment/(impairment
losses) on financial assets, net /H1118/H1118/H1118(3,152) – 704 8 (2,440)
Depreciation and amortisation /H1118/H1118/H1118/H1118(174,240) (1,312,591) (7,191) (6,192) (1,500,214)
Income tax expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(96,638) (238,212) (360) – (335,210)
Investments in associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118629 371,307 – 1,545 373,481
Capital expenditure* /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118440,333 1,046,052 242 745 1,487,372
The capital expenditure information above is based on the increase in property, plant and equipment,
right-of-use assets, other intangible assets, and long-term prepaid expenses during the Relevant Periods.
Y ear ended 31 December 2023 PRC mining Overseas mining Other Total
RMB’000 RMB’000 RMB’000 RMB’000
Segment assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,117,123 13,330,740 509,403 16,957,266
Reconciliation :
Corporate and other unallocated assets /H1118/H1118 50,383
Restricted cash /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 387,648
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 1,274,635
Financial assets at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 16,909
Derivative financial assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 13,470
Deferred tax assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 17,482
Total assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818,717,793
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-43 –


--- page 698 ---
Y ear ended 31 December 2023 PRC mining Overseas mining Other Total
RMB’000 RMB’000 RMB’000 RMB’000
Segment liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118588,289 3,351,867 14,408 3,954,564
Reconciliation :
Corporate and other unallocated
liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 208,380
Short-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 850,009
Financial liabilities at fair value
through profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 939,996
Income tax payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 267,693
Long-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 1,421,974
Current portion of long-term loans /H1118/H1118/H1118/H1118 218,315
Deferred tax liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 2,314,654
Total liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 10,175,585
Nine months ended 30 September 2023 (unaudited)
Nine months ended 30 September 2023 (unaudited) PRC mining Overseas mining Other Total
RMB’000 RMB’000 RMB’000 RMB’000
Segment revenue
Sales to external customers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,047,645 3,760,898 253,750 5,062,293
Intersegment sales /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 40,299 40,299
Total segment revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,047,645 3,760,898 294,049 5,102,592
Reconciliation :
Elimination of intersegment sales /H1118/H1118/H1118/H1118/H1118 (40,299)
Revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,062,293
Segment results /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118477,277 344,907 8,029 830,213
Reconciliation :
Interest income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 19,644
Corporate and other unallocated gains /H1118/H1118 51,687
Finance costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 (143,290)
Profit before tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 758,254
Nine months ended 30 September 2023
(unaudited) PRC mining
Overseas
mining Other Unallocated Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Other segment information
Share of profits and (losses) of:
Associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 6,849 – (128) 6,721
Reversal/(Write-down) of
inventories to net realisable
value /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 18,041 (3) – 18,038
Reversal of impairment/
(impairment losses) on
financial assets, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118(2,307) – 1,188 – (1,119)
Depreciation and amortisation /H1118/H1118(125,296) (941,138) (5,447) (945) (1,072,826)
Income tax expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(60,131) (136,005) (98) – (196,234)
Investments in associates /H1118/H1118/H1118/H1118/H1118629 373,077 – 1,601 375,307
Capital expenditure* /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118291,179 810,388 115 495 1,102,177
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-44 –


--- page 699 ---
The capital expenditure information above is based on the increase in property, plant and equipment,
right-of-use assets, other intangible assets, and long-term prepaid expenses during the Relevant Periods.
Nine months ended 30 September 2024
Nine months ended 30 September 2024 PRC mining Overseas mining Other Total
RMB’000 RMB’000 RMB’000 RMB’000
Segment revenue
Sales to external customers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,589,773 4,429,457 203,601 6,222,831
Intersegment sales /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 117,903 117,903
Total segment revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,589,773 4,429,457 321,504 6,340,734
Reconciliation :
Elimination of intersegment sales /H1118/H1118/H1118/H1118/H1118 (117,903)
Revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,222,831
Segment results /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118823,859 1,060,184 31,429 1,915,472
Reconciliation :
Interest income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 26,197
Corporate and other unallocated gains /H1118/H1118 71,139
Finance costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 (164,773)
Profit before tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 1,848,035
Nine months ended 30 September 2024 PRC mining
Overseas
mining Other Unallocated Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Other segment information
Share of profits and (losses) of
Associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 7,321 – (124) 7,197
Reversal/(Write-down) of
inventories to net realisable
value /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,554 (17,912) 1,107 – (7,251)
Reversal of impairment/
(impairment losses) on
financial assets, net /H1118/H1118/H1118/H1118/H1118/H1118/H11181,170 – 443 11 1,624
Depreciation and amortisation /H1118/H1118(117,798) (815,914) (4,785) (3,988) (942,485)
Income tax expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(118,639) (459,967) (4,660) – (583,266)
Investments in associates /H1118/H1118/H1118/H1118/H1118629 – – 1,421 2,050
Capital expenditure* /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118368,984 756,015 41 373 1,125,413
The capital expenditure information above is based on the increase in property, plant and equipment,
right-of-use assets, other intangible assets, and long-term prepaid expenses during the Relevant Periods.
Nine months ended 30 September 2024 PRC mining Overseas mining Other Total
RMB’000 RMB’000 RMB’000 RMB’000
Segment assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,251,979 12,976,922 763,649 16,992,550
Reconciliation :
Corporate and other unallocated assets /H1118/H1118 392,664
Restricted cash /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 303,616
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 2,094,141
Financial assets at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 13,204
Derivative financial assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 43,438
Deferred tax assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 55,555
Total assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819,895,168
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-45 –


--- page 700 ---
Nine months ended 30 September 2024 PRC mining Overseas mining Other Total
RMB’000 RMB’000 RMB’000 RMB’000
Segment liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118597,524 3,209,660 20,318 3,827,502
Reconciliation :
Corporate and other unallocated
liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 377,567
Short-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 822,730
Financial liabilities at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 1,026,210
Derivative financial liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118 17,002
Income tax payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 455,815
Long-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 681,614
Current portion of long-term loans /H1118/H1118/H1118/H1118 641,778
Deferred tax liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 2,245,052
Total liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 10,095,270
Geographical information
(a) Revenue from external customers
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
PRC /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,259,688 1,477,471 2,026,833 1,301,395 1,793,374
Overseas /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,522,936 4,789,316 5,194,119 3,760,898 4,429,457
3,782,624 6,266,787 7,220,952 5,062,293 6,222,831
The revenue information above is based on the locations of the subsidiaries.
(b) Non-current assets
31 December 2021 31 December 2022 31 December 2023 30 September 2024
RMB’000 RMB’000 RMB’000 RMB’000
Chinese Mainland /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,146,309 2,484,181 2,978,065 3,222,618
Hong Kong /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 355,462 371,349 2,465
Overseas /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,998,328 10,454,107 10,349,676 10,177,747
4,144,637 13,293,750 13,699,090 13,402,830
The non-current asset information above is based on the locations of the assets and excludes financial assets
and deferred tax assets.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-46 –


--- page 701 ---
Information about major customers
Revenue derived from a single customer which accounted for 10% or more of the Group’s total revenue is as
follows:
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Overseas mining segment
ABC Refinery (Australia)
Pty Limited /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,126,600 2,602,266 2,672,102 1,948,532 2,140,263
Rand Refinery (Pty) Limited /H1118/H1118 – 1,745,894 1,841,610 1,331,638 1,758,881
7. REVENUE
An analysis of revenue is as follows:
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
- Revenue from contracts
with customers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,781,944 6,265,589 7,220,054 5,061,571 6,221,458
- Rental income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118680 1,198 898 722 1,373
3,782,624 6,266,787 7,220,952 5,062,293 6,222,831
Revenue from contracts with customers
(a) Disaggregated revenue information
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Types of goods or services
Gold /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,968,694 5,304,729 6,322,263 4,470,575 5,561,259
Silver /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,163 17,391 3,107 49 3,689
Copper cathodes /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118337,440 393,342 381,569 291,407 241,677
Copper concentrate powder /H1118/H1118/H111838,011 21,756 15,962 4,183 6,866
Lead concentrate powder /H1118/H1118/H1118/H111834,700 39,734 29,744 12,082 38,826
Zinc concentrate powder /H1118/H1118/H1118/H1118/H1118135,964 174,303 65,370 27,613 81,595
Molybdenum concentrate
powder /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 3,680 – – 81,477
Comprehensive resource
recycling and utilisation /H1118/H1118/H1118256,201 305,470 398,338 252,928 189,042
Other /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,771 5,184 3,701 2,734 17,027
3,781,944 6,265,589 7,220,054 5,061,571 6,221,458
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-47 –


--- page 702 ---
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Geographical markets
PRC /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,259,080 1,476,431 2,026,111 1,300,674 1,792,104
Laos /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,522,864 2,998,740 3,054,614 2,239,406 2,327,466
Ghana /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,790,418 2,139,329 1,521,491 2,101,888
3,781,944 6,265,589 7,220,054 5,061,571 6,221,458
Timing of revenue recognition
Goods and services transferred
at a point in time /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,781,944 6,265,589 7,220,054 5,061,571 6,221,458
3,781,944 6,265,589 7,220,054 5,061,571 6,221,458
The following table shows the amounts of revenue recognised in the Relevant Periods and the nine months
ended 30 September 2023 that were included in the contract liabilities at the beginning of the reporting period:
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Revenue recognised that was
included in contract liabilities
at the beginning of the
reporting period:
Sale of goods /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,422 4,547 1,227 1,227 9,162
Sale of gold from Metal
Streaming Arrangement
(note 33)* /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 47,201 52,324 36,284 44,749
1,422 51,748 53,551 37,511 53,911
* This amount was related to the acquisition of GSR in January 2022.
(b) Information about the Group’s performance obligations is summarised below:
Sale of goods
The Group recognises revenue when customers gain the control of goods. Prepayments received from
customers before delivery of goods are recognised as contract liabilities in the consolidated financial
statements. Among them, the sales arrangement related to the Metal Streaming Arrangement is detailed in note
33.
Rendering of services
The Group recognizes the fund subsidy income based on type and quantity of standardized dismantling
of waste electronic products and electrical appliances and the corresponding subsidy price.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-48 –


--- page 703 ---
The transaction prices allocated to remaining performance obligations (contracted but unsatisfied or
partially unsatisfied) related to sales of gold are as follows:
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Within 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,547 62,052 73,177 97,221 89,172
Over 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 606,298 576,999 596,615 538,996
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,547 668,350 650,176 693,836 628,168
8. DIRECTORS’ REMUNERATION
Directors’ remuneration is as follows:
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Fees /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118300 800 800 600 674
Other emoluments:
Salaries, allowances and
benefits in kind /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,287 18,426 13,211 9,284 9,814
Performance related bonuses /H1118/H1118/H111814,302 1,116 6,941 – –
Social insurance and
housing fund /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118412 410 341 237 144
27,301 20,752 21,293 10,121 10,632
Directors’ remuneration for each year/period is as follows:
Y ear ended 31 December 2021
Position Fees
Salaries,
allowances
and benefits in
kind
Performance
related
bonuses
Social
insurance and
housing fund Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Jianhua Wang (note (i)) /H1118/H1118/H1118Director – 1,300 1,192 – 2,492
Xiaozhao Lv (note (ii)) /H1118/H1118/H1118/H1118Director – 1,400 1,192 70 2,662
Bo Gao (note (iii)) /H1118/H1118/H1118/H1118/H1118/H1118Director – 1,458 2,834 111 4,403
Xudong Zhang (note (iv)) /H1118/H1118Director – 260 – – 260
Zhiyong Chen (note (v)) /H1118/H1118/H1118Director – 969 700 – 1,669
Xuesheng Fu (note (vi)) /H1118/H1118/H1118Director – 1,942 2,827 – 4,769
Qiang Zhao (note (vii)) /H1118/H1118/H1118/H1118Director – 1,258 1,617 111 2,986
Paul Harris (note (viii)) /H1118/H1118/H1118Director – 2,000 2,557 – 4,557
Jinqian Li (note (ix)) /H1118/H1118/H1118/H1118/H1118Director – 1,700 1,383 120 3,203
Ya n L i (note (x)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118Independent
Director
1 0 0––– 1 0 0
Jingwen Mao (note (xi)) /H1118/H1118/H1118Independent
Director
–––– –
Zhengchang Shen
(note (xii)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Independent
Director
–––– –
Nailian Hu (note (xiii)) /H1118/H1118/H1118/H1118Independent
Director
–––– –
Qingui Guo (note (xiv)) /H1118/H1118/H1118Independent
Director
1 0 0––– 1 0 0
Renman Ruan (note (xv)) /H1118/H1118Independent
Director
1 0 0––– 1 0 0
300 12,287 14,302 412 27,301
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-49 –


--- page 704 ---
Y ear ended 31 December 2022
Position Fees
Salaries,
allowances
and benefits in
kind
Performance
related
bonuses
Social
insurance and
housing fund Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Jianhua Wang (note (i)) /H1118/H1118/H1118Director – 1,797 50 – 1,847
Yi-fang Y ang (note (xvi)) /H1118/H1118Director – 630 100 – 730
Xiaozhao Lv (note (ii)) /H1118/H1118/H1118/H1118Director – 1,786 80 75 1,941
Bo Gao (note (iii)) /H1118/H1118/H1118/H1118/H1118/H1118Director – 2,170 100 124 2,394
Xudong Zhang (note (iv)) /H1118/H1118Director – 300 – – 300
Zhiyong Chen (note (v)) /H1118/H1118/H1118Director – 2,930 100 64 3,094
Xuesheng Fu (note (vi)) /H1118/H1118/H1118Director – 3,198 100 – 3,298
Qiang Zhao (note (vii)) /H1118/H1118/H1118/H1118Director – 1,600 90 124 1,814
Paul Harris (note (viii)) /H1118/H1118/H1118Director – 3,615 496 – 4,111
Jinqian Li (note (ix)) /H1118/H1118/H1118/H1118/H1118Director – 400 – 23 423
Ya n L i (note (x)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118Independent
Director
1 6 0––– 1 6 0
Jingwen Mao (note (xi)) /H1118/H1118/H1118Independent
Director
1 6 0––– 1 6 0
Zhengchang Shen
(note (xii)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Independent
Director
1 6 0––– 1 6 0
Nailian Hu (note (xiii)) /H1118/H1118/H1118/H1118Independent
Director
1 6 0––– 1 6 0
Qingui Guo (note (xiv)) /H1118/H1118/H1118Independent
Director
1 6 0––– 1 6 0
800 18,426 1,116 410 20,752
Y ear ended 31 December 2023
Position Fees
Salaries,
allowances
and benefits in
kind
Performance
related
bonuses
Social
insurance and
housing fund Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Jianhua Wang (note (i)) /H1118/H1118/H1118Director – 1,600 800 – 2,400
Yi-fang Y ang (note (xvi)) /H1118/H1118Director – 1,993 1,981 – 3,974
Xiaozhao Lv (note (ii)) /H1118/H1118/H1118/H1118Director – 1,700 1,360 34 3,094
Bo Gao (note (iii)) /H1118/H1118/H1118/H1118/H1118/H1118Director – 2,000 1,800 139 3,939
Xudong Zhang (note (iv)) /H1118/H1118Director – 300 – – 300
Zhiyong Chen (note (v)) /H1118/H1118/H1118Director – 2,250 1,000 29 3,279
Xuesheng Fu (note (vi)) /H1118/H1118/H1118Director – 125 – – 125
Qiang Zhao (note (vii)) /H1118/H1118/H1118/H1118Director – 100 – 139 239
Paul Harris (note (viii)) /H1118/H1118/H1118Director – 3,143 – – 3,143
Ya n L i (note (x)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118Independent
Director
1 6 0––– 1 6 0
Jingwen Mao (note (xi)) /H1118/H1118/H1118Independent
Director
1 6 0––– 1 6 0
Zhengchang Shen (note
(xii)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Independent
Director
1 6 0––– 1 6 0
Nailian Hu (note (xiii)) /H1118/H1118/H1118/H1118Independent
Director
1 6 0––– 1 6 0
Qingui Guo (note (xiv)) /H1118/H1118/H1118Independent
Director
1 6 0––– 1 6 0
800 13,211 6,941 341 21,293
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-50 –


--- page 705 ---
Nine months ended 30 September 2023 (unaudited)
Position Fees
Salaries,
allowances
and benefits in
kind
Performance
related
bonuses
Social
insurance and
housing fund Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Jianhua Wang (note (i)) /H1118/H1118/H1118Director – 617 – – 617
Yi-fang Y ang (note (xvi)) /H1118/H1118Director – 1,517 – – 1,517
Xiaozhao Lv (note (ii)) /H1118/H1118/H1118/H1118Director – 717 – 34 751
Bo Gao (note (iii)) /H1118/H1118/H1118/H1118/H1118/H1118Director – 1,500 – 104 1,604
Xudong Zhang (note (iv)) /H1118/H1118Director – 225 – – 225
Zhiyong Chen (note (v)) /H1118/H1118/H1118Director – 1,718 – 29 1,747
Xuesheng Fu (note (vi)) /H1118/H1118/H1118Director – 125 – – 125
Qiang Zhao (note (vii)) /H1118/H1118/H1118/H1118Director – 100 – 70 170
Paul Harris (note (viii)) /H1118/H1118/H1118Director – 2,765 – – 2,765
Ya n L i (note (x)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118Independent
Director
1 2 0––– 1 2 0
Jingwen Mao (note (xi)) /H1118/H1118/H1118Independent
Director
1 2 0––– 1 2 0
Zhengchang Shen
(note (xii)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Independent
Director
1 2 0––– 1 2 0
Nailian Hu (note (xiii)) /H1118/H1118/H1118/H1118Independent
Director
1 2 0––– 1 2 0
Qingui Guo (note (xiv)) /H1118/H1118/H1118Independent
Director
1 2 0––– 1 2 0
600 9,284 – 237 10,121
Nine months ended 30 September 2024
Position Fees
Salaries,
allowances
and benefits in
kind
Performance
related
bonuses
Social
insurance and
housing fund Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Jianhua Wang (note (i)) /H1118/H1118/H1118Director – 2,565 – – 2,565
Yi-fang Y ang (note (xvi)) /H1118/H1118Director – 2,133 – 12 2,145
Xiaozhao Lv (note (ii)) /H1118/H1118/H1118/H1118Director – 1,500 – – 1,500
Bo Gao (note (iii)) /H1118/H1118/H1118/H1118/H1118/H1118Director – 1,500 – 104 1,604
Xudong Zhang (note (iv)) /H1118/H1118Director – 240 – – 240
Zhiyong Chen (note (v)) /H1118/H1118/H1118Director – 1,876 – 28 1,904
Ya n L i (note (x)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118Independent
Director
1 1 7––– 1 1 7
Jingwen Mao (note (xi)) /H1118/H1118/H1118Independent
Director
1 3 9––– 1 3 9
Zhengchang Shen (note
(xii)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Independent
Director
1 3 9––– 1 3 9
Nailian Hu (note (xiii)) /H1118/H1118/H1118/H1118Independent
Director
1 3 9––– 1 3 9
Qingui Guo (note (xiv)) /H1118/H1118/H1118Independent
Director
1 1 7––– 1 1 7
Yiping Huang (note (xvii)) /H1118/H1118Independent
Director
2 3––– 2 3
674 9,814 – 144 10,632
(i) Jianhua Wang was appointed as a director on 17 September 2018.
(ii) Xiaozhao Lv was appointed as a director on 14 December 2012.
(iii) Bo Gao was appointed as a director on 14 December 2012.
(iv) Xudong Zhang was appointed as a director on 4 January 2022.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-51 –


--- page 706 ---
(v) Zhiyong Chen was appointed as a director on 4 January 2022.
(vi) Xuesheng Fu was appointed as a director on 17 September 2018, and resigned on 18 January 2023.
(vii) Qiang Zhao was appointed as a director on 14 December 2012, and resigned on 18 January 2023.
(viii) Paul Harris was appointed as a director on 27 February 2020, and resigned on 27 September 2023.
(ix) Jinqian Li was appointed as a director on 27 February 2020 and resigned on 13 March 2022.
(x) Y an Li was appointed as an independent director on 17 September 2018, and resigned on 23 August
2024.
(xi) Jingwen Mao was appointed as an independent director on 4 January 2022.
(xii) Zhengchang Shen was appointed as an independent director on 4 January 2022.
(xiii) Nailian Hu was appointed as an independent director on 4 January 2022.
(xiv) Qingui Guo was appointed as an independent director on 17 September 2018, and resigned on 23 August
2024.
(xv) Renman Ruan was appointed as an independent director on 17 September 2018 and resigned on 4
January 2022.
(xvi) Yi-fang Y ang was appointed as a director on 26 July 2022.
(xvii) Yiping Huang was appointed as an independent director on 23 August 2024.
9. FIVE HIGHEST PAID EMPLOYEES
The five highest paid employees during the years ended 31 December 2021, 2022 and 2023, and the nine
months ended 30 September 2023 and 2024 included five, four, four, three and four directors, respectively, details
of whose remuneration are set out in note 8 above. Details of the remuneration for the remaining highest paid
employees who are neither a director nor chief executive of the Company during the years ended 31 December 2021,
2022 and 2023, and the nine months ended 30 September 2023 and 2024 are as follows:
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Salaries, allowances and
benefits in kind /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 3,089 1,900 3,468 1,583
Performance related bonuses /H1118/H1118/H1118 – 100 1,330 – –
Social insurance and
housing fund /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 56 139 139 12
– 3,245 3,369 3,607 1,595
The number of non-director and non-chief executive highest paid employees whose remuneration fell within
the following bands is as follows:
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
(unaudited)
Nil to RMB2,000,000 /H1118/H1118/H1118/H1118/H1118/H1118/H1118–––11
RMB2,000,001 to
RMB2,500,000 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–––1–
RMB2,500,001 to
RMB3,000,000 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–––––
RMB3,000,001 to
RMB3,500,000 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–11––
–1121
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-52 –


--- page 707 ---
10. OTHER INCOME AND GAINS
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Government grants /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,363 4,045 16,950 1,227 768
Gains on changes in fair value
of financial assets at fair
value through profit or loss /H1118/H1118 1,415 17,91 8–––
Gains on changes in fair value
of derivative financial
instruments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 584 13,470 33,665 29,383
Gains on disposal of derivative
financial instruments /H1118/H1118/H1118/H1118/H1118/H111825,014 82,913 75,343 34,937 143,446
Gains on disposal of investment
in an associate /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–––– 71,119
Gains on disposal of financial
assets at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 4,226 – –
Finance income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820,439 28,097 26,322 19,644 26,197
Gain on recognition of negative
goodwill (note 50) /H1118/H1118/H1118/H1118/H1118/H1118/H1118– 6,37 1–––
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111842,281 2,160 1,459 1,135 1,072
90,512 142,088 137,770 90,608 271,985
11. OTHER EXPENSES AND LOSSES
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Donations /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815,100 940 222 12 690
Loss on disposal of
non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,060 2,632 1,853 1,388 367
Loss on derecognition of
financial liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,856 17,249 76,018 55,930 107,426
Loss on changes in fair value of
financial liabilities at fair value
through profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H11183,111 30,416 63,428 23,308 83,256
Loss on changes in fair value of
financial assets at fair value
through profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 21,385 19,713 3,221
Impairment losses/(reversal of
impairment) on inventories /H1118/H1118/H1118191,615 41,723 3,516 (18,038) 7,251
Foreign exchange differences,
net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(86,237) (27,244) (20,157) (18,855) (27,781)
Other /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,255 53,306 27,236 23,311 15,475
142,760 119,022 173,501 86,769 189,905
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-53 –


--- page 708 ---
12. FINANCE COSTS
An analysis of finance costs from continuing operations is as follows:
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Interest on loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,870 127,797 159,621 102,319 106,868
Interest on gold lease business /H1118/H1118 1,793 10,396 14,797 11,976 18,771
Interest on Metal Streaming
Arrangement /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 15,393 15,093 12,473 21,059
Amortisation of unrecognised
finance expenses of mining
rights /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 3,793 3,766 2,938 2,717
Accretion of interest of
provisions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,393 8,895 9,409 6,468 7,075
Interest on lease liabilities
(note 18(c)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118170 10,211 12,340 7,116 8,283
14,226 176,485 215,026 143,290 164,773
13. PROFIT BEFORE TAX
The Group’s profit before tax is arrived at after charging/(crediting):
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
Notes RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Cost of raw materials and
consumables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,005,402 2,132,246 2,113,118 1,504,471 1,359,063
Depreciation of property,
plant and equipment /H1118/H1118/H111817 455,688 761,217 910,774 591,421 687,486
Depreciation of right-of-
use assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818 3,607 30,180 36,973 21,466 29,017
Amortisation of other
intangible assets /H1118/H1118/H1118/H1118/H111819 315,883 582,247 552,382 459,875 225,945
Amortisation of other
non-current assets /H1118/H1118/H1118/H1118 4,152 1,843 85 64 37
Research and development
costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111824,847 27,652 51,753 24,952 47,893
Lease payments not
included in the
measurement of lease
liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,115 20,766 15,969 12,529 8,818
Auditor’s remuneration /H1118/H1118 2,751 5,414 7,041 3,027 3,299
Employee benefit expense
(including directors’
remuneration):
Wages and salaries /H1118/H1118/H1118/H1118/H1118 460,712 834,768 1,071,645 707,179 927,625
Pension and other social
insurances /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111835,594 36,365 47,045 35,655 34,151
496,306 871,133 1,118,690 742,834 961,776
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-54 –


--- page 709 ---
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
Notes RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Foreign exchange
(gains)/losses, net /H1118/H1118/H1118/H111811 (86,237) (27,244) (20,157) (18,855) (27,781)
Write-down/(Reversal) of
inventories to net
realisable value /H1118/H1118/H1118/H1118/H111811 191,615 41,723 3,516 (18,038) 7,251
(Reversal of impairment)/
impairment losses on
financial assets, net /H1118/H1118/H1118 1,984 644 2,440 1,119 (1,624)
Gains on changes in fair
value of financial assets
at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H111810 (1,415) (17,918) – – –
Gains on changes in fair
value of derivative
financial instruments /H1118/H111810 – (584) (13,470) (33,665) (29,383)
Gains on disposal of
investment in an
associate /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810 –––– (71,119)
Gains on disposal of
derivative financial
instruments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810 (25,014) (82,913) (75,343) (34,937) (143,446)
Gains on disposal of
financial assets at fair
value through profit or
loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810 – – (4,226) – –
Loss on changes in fair
value of financial
liabilities at fair value
through profit or loss /H1118/H111811 3,111 30,416 63,428 23,308 83,256
Loss on derecognition of
financial liabilities /H1118/H1118/H1118/H111811 10,856 17,249 76,018 55,930 107,426
Loss on changes in fair
value of financial assets
at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H111811 – – 21,385 19,713 3,221
Loss on disposal of non-
current assets /H1118/H1118/H1118/H1118/H1118/H1118/H111811 3,060 2,632 1,853 1,388 367
14. INCOME TAX EXPENSES
Under the Corporate Income Tax Law of the PRC (the “CIT”), the statutory tax rate of the Company,
subsidiaries and its key associates in Chinese Mainland is 25%.
Pillar Two legislation has been enacted or substantively enacted in certain jurisdictions in which the Company
and its subsidiaries operate, the Company is still in the process of assessing the potential exposure to Pillar Two
income taxes. Based on the current assessment, the Pillar Two effective tax rates in most of the jurisdictions in which
the Company and its subsidiaries operate are above 15%.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-55 –


--- page 710 ---
List of other corporate income tax rates applicable to the Group’s subsidiaries:
Name Countries and regions Rates
Golden Star (Wassa) Limited /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Ghana 35.0%
LXML /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Laos 33.3%
GSR /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Canada 26.5%
Chijin (Tianjin) Geological Exploration Technology
Co., Ltd. (a) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
PRC 20.0%
Chijin HK /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Hong Kong 16.5%
Jilin Han Feng Mining Technologies Co., Ltd. (b) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118PRC 15.0%
Eryuan Jintai Mining Development Co., Ltd. (b) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118PRC 15.0%
Liaoning Wulong Gold Mining Co., Ltd. (c) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118PRC 15.0%
Chifeng Jilong Mining Co., Ltd. (d) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118PRC 15.0%
Hefei Guangyuan Environmental Protection Technology
Co., Ltd. (e) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
PRC 2021-2022: N/A
2023-2024: 0%
Hefei Huanchuang Advanced Material Co., Ltd. (e) /H1118/H1118/H1118/H1118/H1118/H1118/H1118PRC 2021-2023: 12.5%
2024: 25.0%
(a) According to the Announcement of the State Administration of Taxation on Issues Relating to the
Implementation of Inclusive Income Tax Relief Policy for Small Thin-profit Enterprises (State
Administration of Taxation Announcement [2019] No. 2), during the period from 1 January 2019 to 31
December 2021, the portion of the annual taxable profit of a small thin-profit enterprise which does not
exceed RMB1 million, the taxable profit can be reduced to 25%, and corporate income tax shall be
levied at a reduced tax rate of 20%; the portion of the annual taxable profit which exceeds RMB1 million
but does not exceed RMB3 million, the taxable profit can be reduced to 50%, and corporate income tax
shall be levied at a reduced tax rate of 20%. From 1 January 2022 to 31 December 2024, according to
the Announcement on Further Implementing Preferential Policies for Income Tax of Small and Micro
Enterprises (Announcement [2022] No. 13 of the Ministry of Finance and the State Administration of
Taxation), for the portion of the annual taxable profit which exceeds RMB1 million but does not exceed
RMB3 million, the taxable profit can be reduced to 25%, and corporate income tax shall be levied at
a reduced tax rate of 20%. The subsidiary, Chijin (Tianjin) Geological Exploration Technology Co., Ltd.,
which is a small thin-profit enterprise, adopted this policy for the period from 1 January 2021 to 30
September 2024.
(b) According to the Announcement on Continuation of CIT Policies for Large-scale Development in the
Western Region (Announcement [2020] No. 23 of the Ministry of Finance, State Administration of
Taxation and National Development and Reform Commission), during the period from 1 January 2021
to 31 December 2030, CIT shall be levied at a reduced tax rate of 15% on enterprises established in the
western region in encouraged industries. This policy is applicable to the subsidiaries Jilin Han Feng
Mining Technologies Co., Ltd. and Eryuan Jintai Mining Development Co., Ltd.
(c) According to the High-New Technical Enterprise (“HNTE”) certificate renewed in December 2020, the
CIT rate of the subsidiary Liaoning Wulong Gold Mining Co., Ltd. was 15% for the years from 2020
to 2022. According to the HNTE certificate renewed in December 2023, the CIT rate of Liaoning
Wulong Gold Mining Co., Ltd. was 15% for the years from 2023 to 2025.
(d) According to the High-New Technical Enterprise (“HNTE”) certificate renewed in November 2020, the
CIT rate of the subsidiary Chifeng Jilong Mining Co., Ltd. was 15% for the years from 2020 to 2022.
According to the HNTE certificate renewed in November 2023, the CIT rate of Chifeng Jilong Mining
Co., Ltd. was 15% for the years from 2023 to 2025.
(e) According to Article 27 of the Enterprise Income Tax Law , Article 88 of the Implementation Regulations
of the Enterprise Income Tax Law , and Caishui (2009) No. 166, eligible environmental protection,
energy conservation, and water-saving household waste treatment service projects shall enjoy the
preferential policy of “three years of tax exemption followed by three years of tax reduction” of income
tax. The subsidiary Hefei Huanchuang Advanced Material Co., Ltd. has been enjoying this policy since
2018, specifically: “Tax exemption in 2018, 2019 and 2020, reduced by half in 2021, 2022 and 2023.”
The subsidiary Hefei Guangyuan Environmental Protection Technology Co., Ltd. has been enjoying this
policy since 2023, specifically: “Tax exemption in 2023, 2024 and 2025, reduced by half in 2026, 2027
and 2028.”
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-56 –


--- page 711 ---
An analysis of the Group’s provision for tax is as follows:
Note
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Current-Mainland China
Charge for the year /H1118/H1118/H1118 62,433 53,769 105,577 73,143 121,197
Under/(Over) provision
in prior years /H1118/H1118/H1118/H1118/H1118 (31,068) (1,855) – – 3,719
Current-Overseas
Charge for the year /H1118/H1118/H1118 86,895 215,703 375,291 226,199 488,603
Under provision in
prior years /H1118/H1118/H1118/H1118/H1118/H1118/H1118 – 11,635 – – 50,342
Deferred /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111822 38,707 48,880 (145,658) (103,108) (80,595)
Total tax charge /H1118/H1118/H1118/H1118/H1118/H1118/H1118156,967 328,132 335,210 196,234 583,266
A reconciliation of the tax expense applicable to profit before tax at the statutory rates for jurisdictions in
which the Company and the majority of its subsidiaries are domiciled to the tax expense at the effective tax rates,
and a reconciliation of the applicable rates (i.e., the statutory tax rates) to the effective tax rates, are as follows:
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Profit before tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118770,375 822,012 1,206,795 758,254 1,848,035
Tax expense calculated at the
statutory tax rate of 25% /H1118/H1118/H1118/H1118192,594 205,503 301,699 189,564 462,009
Effect of different tax rates
of subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(21,801) 59,293 24,942 8,050 70,110
Adjustments in respect of current
tax of previous periods /H1118/H1118/H1118/H1118/H1118(31,068) 9,780 – – 54,061
Profits and losses attributable
to associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 712 (1,566) (1,098) (1,183)
Non-taxable income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (6,557) – – (11,735)
Non-deductible expenses /H1118/H1118/H1118/H1118/H1118/H111823,574 35,460 10,144 7,438 9,072
Tax losses utilised from
previous periods /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(3,993) – (6,591) (10,298) (3,995)
Unrecognised deductible
temporary differences and
tax losses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118473 32,058 14,160 6,143 11,800
Effect on opening deferred tax
of change in the tax rate /H1118/H1118/H1118/H1118(327) ––––
Tax benefit for qualifying
research and development
expenses and wages for
disabled employees /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(2,485) (8,117) (7,578) (3,565) (6,873)
Tax charge at the effective rate /H1118/H1118156,967 328,132 335,210 196,234 583,266
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-57 –


--- page 712 ---
15. EARNINGS PER SHARE ATTRIBUTABLE TO ORDINARY EQUITY HOLDERS OF THE PARENT
The calculation of the basic earnings per share amounts is based on the profit for the Relevant Periods and the
nine months ended 30 September 2023 attributable to ordinary equity holders of the parent, and the weighted average
number of ordinary shares of 1,643,193,590, 1,662,334,305 and 1,641,398,872 during the years ended 31 December
2021, 2022 and 2023, 1,644,441,750 and 1,648,728,778 for the nine months ended 30 September 2023 and 2024,
respectively, as adjusted to reflect the rights issue during the year.
The calculation of the basic earnings per share amounts is based on the profit for the year attributable to
ordinary equity holders of the parent.
The calculation of the diluted earnings per share amounts is based on the profit for the year attributable to
ordinary equity holders of the parent.The weighted average number of ordinary shares used in the calculation is the
number of ordinary shares in issue during the year, as used in the basic earnings per share calculation, and the
weighted average number of ordinary shares assumed to have been issued at no consideration on the deemed exercise
or conversion of all dilutive potential ordinary shares into ordinary shares.
The calculations of basic and diluted earnings per share are based on:
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Earnings
Profit attributable to ordinary
equity holders of the parent,
used in the basic earnings per
share calculation:
From continuing operations /H1118/H1118/H1118581,949 450,976 804,471 526,655 1,115,256
581,949 450,976 804,471 526,655 1,115,256
Number of shares
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
Shares
Weighted average number of
ordinary shares in issue
during the Relevant Periods
used in the basic earnings
per share calculation /H1118/H1118/H1118/H1118/H11181,643,193,590 1,662,334,305 1,641,398,872 1,644,441,750 1,648,728,778
* The Group had no potentially dilutive ordinary shares outstanding during the years ended 31 December
2021, 2022, 2023 and the nine months ended 30 September 2023 and 2024.
16. DIVIDENDS
Based on the resolution passed by the Board of Directors on 29 March 2024, the proposed profit distribution
plan for the year 2023 is as follows: With a total share capital of 1,663,911,378 shares at the end of 2023, after
deducting the 15,182,600 shares held in the Company’s dedicated securities account for repurchases, the base for
profit distribution will be 1,648,728,778 shares. A cash dividend of RMB0.50 per 10 shares (including tax) will be
paid to all shareholders, totaling RMB82,436,000. The aforementioned proposed final dividend was approved by the
shareholders on 19 April 2024. As at 30 September 2024, all the final dividend has been paid.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-58 –


--- page 713 ---
17. PROPERTY, PLANT AND EQUIPMENT
The Group
Buildings Machinery
Mobile
equipment
Electronic
equipment
and others
Mineral
assets
Construction
in progress Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Cost
At 1 January 2021 /H1118/H1118/H1118811,844 4,738,512 607,662 47,121 2,549,914 250,033 9,005,086
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,794 46,280 3,497 5,016 26,391 779,987 869,965
Transfers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111816,000 313,246 20,022 3,701 207,221 (560,190) –
Exchange realignment /H1118 (11,679) (105,263) (13,552) (249) (32,441) (34,205) (197,389)
Disposals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,527) (22,671) (5,535) (678) (3,361) – (33,772)
At 31 December 2021 /H1118 823,432 4,970,104 612,094 54,911 2,747,724 435,625 9,643,890
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,320 46,688 30,066 4,471 103,818 1,118,629 1,312,992
Transfers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118136,623 418,915 31,746 3,211 471,293 (1,061,788) –
Acquisition of a
subsidiary (Note 50) /H1118 57,259 219,950 117,720 1,757 1,459,468 48,828 1,904,982
Exchange realignment /H1118 51,005 458,381 66,163 3,784 268,751 96,024 944,108
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(20,021) (34,380) (35,818) 70,219 (39,712) 39,515 (20,197)
Disposals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(22,654) (35,529) (3,630) (957) – – (62,770)
At 31 December 2022 /H11181,034,964 6,044,129 818,341 137,396 5,011,342 676,833 13,723,005
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111831 10,317 11,659 5,617 6,246 1,354,306 1,388,176
Transfers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118262,122 265,893 33,668 6,884 877,803 (1,446,370) –
Acquisition of
a subsidiary /H1118/H1118/H1118/H1118/H1118/H111850 106 233 26 – – 415
Exchange realignment /H1118 11,032 95,788 13,533 1,550 61,020 7,544 190,467
Disposals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(11,363) (4,763) (18,113) (558) (2,271) – (37,068)
At 31 December 2023 /H11181,296,836 6,411,470 859,321 150,915 5,954,140 592,313 15,264,995
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118863 16,239 4,934 2,585 – 1,085,705 1,110,326
Transfers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118197,816 107,358 9,602 3,047 137,570 (455,393) –
Exchange realignment /H1118/H1118(8,290) (63,910) (8,896) (1,077) (45,963) (11,553) (139,689)
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (177) (1,020) – (5,477) 5,655 (1,019)
Disposals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(3,035) (872) –––– (3,907)
At 30 September 2024 /H11181,484,190 6,470,108 863,941 155,470 6,040,270 1,216,727 16,230,706
Buildings Machinery
Mobile
equipment
Electronic
equipment
and others
Mineral
assets
Construction
in progress Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Accumulated
depreciation
At 1 January 2021 /H1118/H1118/H1118487,110 3,826,581 481,935 32,238 1,357,666 – 6,185,530
Charge for the year /H1118/H1118/H111849,183 232,168 50,519 9,306 114,512 – 455,688
Exchange realignment /H1118 (9,080) (86,250) (11,169) (2,918) (23,332) – (132,749)
Disposals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,350) (20,185) (5,484) (644) (1,421) – (29,084)
At 31 December 2021 /H1118 525,863 3,952,314 515,801 37,982 1,447,425 – 6,479,385
Charge for the year /H1118/H1118/H111860,607 383,210 34,527 9,604 273,269 – 761,217
Exchange realignment /H1118/H111840,039 359,072 47,223 3,427 103,446 – 553,207
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820,720 (89,058) (2,067) 63,330 (15,510) – (22,585)
Disposals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(3,137) (35,024) (3,391) (933) – – (42,485)
At 31 December 2022 /H1118 644,092 4,570,514 592,093 113,410 1,808,630 – 7,728,739
Charge for the year /H1118/H1118/H111851,294 356,958 67,392 8,905 426,225 – 910,774
Exchange realignment /H1118/H1118 8,918 75,933 10,063 1,416 23,951 – 120,281
Disposals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(2,318) (3,277) (8,188) (500) (2,162) – (16,445)
At 31 December 2023 /H1118 701,986 5,000,128 661,360 123,231 2,256,644 – 8,743,349
Charge for the period /H1118/H111843,598 225,715 43,260 7,469 367,444 – 687,486
Exchange realignment /H1118/H1118(6,241) (53,616) (7,405) (976) (22,251) – (90,489)
Other /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (60) (806) – (153) – (1,019)
Disposals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(2,833) (80) –––– (2,913)
At 30 September 2024 /H1118 736,510 5,172,087 696,409 129,724 2,601,684 – 9,336,414
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-59 –


--- page 714 ---
Buildings Machinery
Mobile
equipment
Electronic
equipment
and others
Mineral
assets
Construction
in progress Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Provision for
impairment
At 1 January 2021 /H1118/H1118/H11184,80 6––––– 4,806
At 31 December 2021 /H1118 4,80 6––––– 4,806
Disposals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(4,806) ––––– (4,806)
At 31 December 2022 /H1118 –––––––
At 31 December 2023 /H1118 –––––––
At 30 September 2024 /H1118 –––––––
Carrying amounts
At 1 January 2021 /H1118/H1118/H1118319,928 911,931 125,727 14,883 1,192,248 250,033 2,814,750
At 31 December 2021 /H1118 292,763 1,017,790 96,293 16,929 1,300,299 435,625 3,159,699
At 31 December 2022 /H1118 390,872 1,473,615 226,248 23,986 3,202,712 676,833 5,994,266
At 31 December 2023 /H1118 594,850 1,411,342 197,961 27,684 3,697,496 592,313 6,521,646
At 30 September 2024 /H1118 747,680 1,298,021 167,532 25,746 3,438,586 1,216,727 6,894,292
Further details of property, plant and equipment used as collateral for borrowings are included in notes
35 and 36 to the Historical Financial Information.
The Company
Buildings
Mobile
equipment
Electronic
equipment and
others Total
RMB’000 RMB’000 RMB’000 RMB’000
Cost
At 1 January 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111832,675 3,015 2,237 37,927
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 883 883
At 31 December 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111832,675 3,015 3,120 38,810
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 176 176
Disposals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(19,829) – (5) (19,834)
At 31 December 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,846 3,015 3,291 19,152
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 647 647
Disposals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(11,333) (2,160) – (13,493)
At 31 December 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,513 855 3,938 6,306
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 332 332
At 30 September 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,513 855 4,270 6,638
Accumulated depreciation
At 1 January 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,126 1,901 789 5,816
Charge for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,546 511 438 2,495
At 31 December 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,672 2,412 1,227 8,311
Charge for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118923 182 556 1,661
Disposals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(3,137) – (5) (3,142)
At 31 December 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,458 2,594 1,778 6,830
Charge for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118220 156 633 1,009
Disposals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(2,296) (2,052) – (4,348)
At 31 December 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118382 698 2,411 3,491
Charge for the period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111854 92 411 557
At 30 September 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118436 790 2,822 4,048
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-60 –


--- page 715 ---
Buildings
Mobile
equipment
Electronic
equipment and
others Total
RMB’000 RMB’000 RMB’000 RMB’000
Carrying amounts
At 1 January 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111829,549 1,114 1,448 32,111
At 31 December 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111828,003 603 1,893 30,499
At 31 December 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,388 421 1,513 12,322
At 31 December 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,131 157 1,527 2,815
At 30 September 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,077 65 1,448 2,590
18. LEASES
The Group
The Group as a lessee
The Group has lease contracts for various items of leasehold land, buildings, motor vehicles, and office and
other equipment. Lump sum payments were made upfront to acquire the land use right in Chinese Mainland with
periods of 50 years, and no ongoing payments will be made.
(a) Right-of-use assets
The carrying amounts of the Group’s right-of-use assets and the movements are as follows:
Buildings
Machinery and
vehicles Leasehold land Total
RMB’000 RMB’000 RMB’000 RMB’000
Y ear ended 31 December 2021
Cost at 1 January 2021, net of
accumulated depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,218 – 46,276 47,494
Depreciation provided during the year /H1118/H1118 (920) – (2,687) (3,607)
At 31 December 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118298 – 43,589 43,887
At 31 December 2021
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,218 – 56,671 57,889
Accumulated depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(920) – (13,082) (14,002)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118298 – 43,589 43,887
Y ear ended 31 December 2022
Cost at 1 January 2022, net of
accumulated depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118298 – 43,589 43,887
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813,986 – 42,627 56,613
Acquisition of a subsidiary (note 50) /H1118/H1118/H1118 7,563 189,637 – 197,200
Depreciation provided during the year /H1118/H1118 (6,415) (19,496) (4,269) (30,180)
Disposal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(5,118) – – (5,118)
Exchange realignment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118475 15,694 – 16,169
At 31 December 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,789 185,835 81,947 278,571
At 31 December 2022
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111817,818 207,189 99,297 324,304
Accumulated depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(7,029) (21,354) (17,350) (45,733)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,789 185,835 81,947 278,571
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-61 –


--- page 716 ---
Buildings
Machinery and
vehicles Leasehold land Total
RMB’000 RMB’000 RMB’000 RMB’000
Y ear ended 31 December 2023
Cost at 1 January 2023, net of
accumulated depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,789 185,835 81,947 278,571
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 2,550 62,367 64,917
Acquisition of a subsidiary /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 23,065 23,065
Depreciation provided during the year /H1118/H1118 (6,243) (23,700) (7,030) (36,973)
Exchange realignment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825 3,151 – 3,176
At 31 December 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,571 167,836 160,349 332,756
At 31 December 2023
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111817,862 213,252 184,730 415,844
Accumulated depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(13,291) (45,416) (24,381) (83,088)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,571 167,836 160,349 332,756
Nine months ended 30 September 2024
Cost at 1 January 2024, net of
accumulated depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,571 167,836 160,349 332,756
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,508 – 8,775 11,283
Depreciation provided during the period /H1118 (3,792) (18,736) (6,489) (29,017)
Exchange realignment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(41) (1,784) – (1,825)
At 30 September 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,246 147,316 162,635 313,197
At 30 September 2024
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820,298 210,985 193,504 424,787
Accumulated depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(17,052) (63,669) (30,869) (111,590)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,246 147,316 162,635 313,197
(b) Lease liabilities
The carrying amount of lease liabilities and the movements are as follows:
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Carrying amount at 1 January /H1118/H1118/H1118/H1118/H1118/H1118/H11185,782 4,399 261,982 245,302
New leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 56,538 2,912 2,665
Acquisition of a subsidiary (note 50) /H1118/H1118/H1118 – 207,137 23,065 –
Accretion of interest recognised during
the year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118170 10,211 12,340 8,283
Payments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,553) (33,696) (58,102) (30,686)
Exchange realignment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 17,393 3,105 (2,020)
Carrying amount at end of the
year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,399 261,982 245,302 223,544
Analysed into:
Current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,424 31,177 38,083 38,204
Non-current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,975 230,805 207,219 185,340
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-62 –


--- page 717 ---
(c) The amounts recognised in profit or loss in relation to leases are as follows:
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Interest on lease liabilities
(note 12) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118170 10,211 12,340 7,116 8,283
Depreciation charge of
right-of-use assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,607 30,180 36,973 21,466 29,017
Expense relating to short-term
leases and leases with
low-value assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,115 20,766 15,969 12,529 8,818
The maturity analysis of lease liabilities is disclosed in note 49 to the Historical Financial Information.
The Company
The Company as a lessee
The Company has lease contracts for buildings.
(a) Right-of-use assets
The carrying amounts of the Company’s right-of-use assets and the movements are as follows:
Buildings Total
RMB’000 RMB’000
Y ear ended 31 December 2022
Cost at 1 January 2022, net of accumulated depreciation /H1118/H1118/H1118/H1118 ––
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813,986 13,986
Depreciation provided during the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(4,661) (4,661)
At 31 December 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,325 9,325
At 31 December 2022
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813,986 13,986
Accumulated depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(4,661) (4,661)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,325 9,325
Y ear ended 31 December 2023
Cost at 1 January 2023, net of accumulated depreciation /H1118/H1118/H1118/H1118 9,325 9,325
Depreciation provided during the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(4,968) (4,968)
At 31 December 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,357 4,357
At 31 December 2023
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813,986 13,986
Accumulated depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(9,629) (9,629)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,357 4,357
Nine months ended 30 September 2024
Cost at 1 January 2024, net of accumulated depreciation /H1118/H1118/H1118/H1118 4,357 4,357
Depreciation provided during the period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(3,268) (3,268)
At 30 September 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,089 1,089
At 30 September 2024
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813,986 13,986
Accumulated depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(12,897) (12,897)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,089 1,089
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-63 –


--- page 718 ---
(b) Lease liabilities
The carrying amount of lease liabilities and the movements are as follows:
Y ear ended
31 December 2021
Y ear ended
31 December 2022
Y ear ended
31 December 2023
Nine months ended
30 September 2024
RMB’000 RMB’000 RMB’000 RMB’000
Carrying amount at 1 January /H1118/H1118/H1118 – – 9,535 4,385
New leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 13,986 – –
Accretion of interest recognised
during the year/period /H1118/H1118/H1118/H1118/H1118/H1118– 425 236 83
Payments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (4,876) (5,386) (2,197)
Carrying amount at end of the
year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 9,535 4,385 2,271
Analysed into:
Current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 4,659 4,385 2,271
Non-current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118– 4,876 – –
(c) The amounts recognised in profit or loss in relation to leases are as follows:
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Interest on lease liabilities /H1118/H1118 – 425 236 137 83
Depreciation charge of right-
of-use assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 4,661 4,969 1,872 3,267
Expense relating to
short-term leases and
leases with low-value
assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,369 182 170 170 52
19. OTHER INTANGIBLE ASSETS
Exploration and
mining rights Patent
Exploration and
evaluation assets Others Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Cost
At 1 January 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,451,971 6,715 58,775 48,889 2,566,350
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118650,268 – 38,343 1,219 689,830
Exchange realignment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(46,295) – – (1,743) (48,038)
At 31 December 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,055,944 6,715 97,118 48,365 3,208,142
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118477,846 – 40,207 15,438 533,491
Acquisition of a subsidiary (Note 50) /H1118/H1118/H11185,247,807 – – 727 5,248,534
Exchange realignment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118703,523 – – 4,834 708,357
Others (Note) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111857,105 – (72,481) 48 (15,328)
At 31 December 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,542,225 6,715 64,844 69,412 9,683,196
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,364 – 32,482 433 34,279
Acquisition of a subsidiary /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118175,76 9––9 175,778
Exchange realignment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118146,477 – – 1,116 147,593
At 31 December 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,865,835 6,715 97,326 70,970 10,040,846
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 2,778 1,026 3,804
Exchange realignment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(93,393) – – (728) (94,121)
Disposals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – (104) (104)
At 30 September 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,772,442 6,715 100,104 71,164 9,950,425
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-64 –


--- page 719 ---
Exploration and
mining rights Patent
Exploration and
evaluation assets Others Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Accumulated amortisation
At 1 January 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,975,579 2,069 – 45,118 2,022,766
Charge for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118313,831 673 – 1,379 315,883
Exchange realignment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(39,858) – – (1,095) (40,953)
At 31 December 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,249,552 2,742 – 45,402 2,297,696
Charge for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118578,340 551 – 3,356 582,247
Exchange realignment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118176,622 – – 1,680 178,302
Other /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,22 8––9 8,237
At 31 December 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,012,742 3,293 – 50,447 3,066,482
Charge for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118546,834 673 – 4,875 552,382
Exchange realignment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111844,115 – – 862 44,977
At 31 December 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,603,691 3,966 – 56,184 3,663,841
Charge for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118223,122 432 – 2,391 225,945
Exchange realignment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(35,081) – – (614) (35,695)
Disposals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – (104) (104)
At 30 September 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,791,732 4,398 – 57,857 3,853,987
Provision for impairment as at
1 January 2021, 31 December 2021,
31 December 2022, 31 December
2023 and 30 September 2024 /H1118/H1118/H1118/H1118/H111853,99 6––– 53,996
Carrying amounts
At 1 January 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118422,396 4,646 58,775 3,771 489,588
At 31 December 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118752,396 3,973 97,118 2,963 856,450
At 31 December 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,475,487 3,422 64,844 18,965 6,562,718
At 31 December 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,208,148 2,749 97,326 14,786 6,323,009
At 30 September 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,926,714 2,317 100,104 13,307 6,042,442
Note: The Others was mainly comprised of the exploration and evaluation assets that were reclassified into mining
rights as a result of obtaining the mining right.
20. GOODWILL
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Beginning and closing balances /H1118/H1118/H1118 41,969 41,969 41,969 41,969
Goodwill acquired through business combinations is allocated to the recycling and utilisation CGU for
impairment testing.
The recoverable amount of the recycling and utilisation CGU has been determined based on a value in use
calculation using cash flow projections based on financial budgets covering a five-year period approved by senior
management. As at 31 December 2021, 2022 and 2023 and 30 September 2024, the pre-tax discount rates applied to
the cash flow projections are 13.46%, 11.89%, 9.21% and 8.79%, respectively. The growth rate used to extrapolate
the cash flows of the recycling and utilisation CGU beyond the five-year period is 0%.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-65 –


--- page 720 ---
Assumptions were used in the value in use calculation of the recycling and utilisation cash-generating CGU.
The following describes each key assumption on which management has based its cash flow projections to undertake
impairment testing of goodwill:
The expected future sales volume — The management forecasted disassembly volume based on the disassembly
volume capacity and the expected five years’ production schedule of the CGU.
The price of the dismantled product — The management forecasted the price of the dismantled product based
on the actual sales unit price of the previous year with its expectations on market development.
The collection period of the fund subsidy income — The management forecasted the collection period of the
fund subsidy income based on the historical collection period with its expectations on market development.
Discount rate — The discount rates used are before tax and reflect specific risks relating to the relevant CGU.
Management determined these assumptions based on past performance and its expectations on market
development. The discount rates used reflect specific risks relating to the individual CGU. The recoverable amount
is determined based on the present value of the estimated future cash flows of the CGU. According to the 5-year
financial forecast approved by the management, the growth rates of the dismantling volume of waste electronic
products and electrical appliances from 2024 to 2028 during the forecast period are projected to be 3%, 6%, 10%,
5%, and 3% respectively, and the dismantling volume of waste electronic products and electrical appliances will
remain stable from 2029 onwards. Based on the impairment assessments, there was no impairment of goodwill as at
31 December 2021, 2022 and 2023 and 30 September 2024, and the headroom (i.e., the excess of the recoverable
amount over the carrying amount of the CGU) was RMB82 million, RMB88 million, RMB17 million, and RMB19
million, respectively.
For the goodwill allocated to the CGU, management has assessed that two of the most sensitive key
assumptions are future sales volume and price of the dismantled product. As at 31 December 2021, 2022 and 2023
and 30 September 2024, if future sales volume had decreased by 1% from management’s estimates, while other
variables were held constant with the expectations, the Group would have to recognise impairment losses against
goodwill by approximately nil, nil, nil and nil, respectively; if future sales volume had decreased by 5% from
management’s estimates, while other variables were held constant with the expectations, the Group would have to
recognise impairment losses against goodwill by approximately nil, nil, nil and RMB42 million, respectively; if the
price of the dismantled product had decreased by 1% from management’s estimates, while other variables were held
constant with the expectations, the Group would have to recognise impairment losses against goodwill by
approximately nil, nil, RMB25 million and RMB22 million, respectively; if the price of the dismantled product had
decreased by 5% from management’s estimates, while other variables were held constant with the expectations, the
Group would have to recognise impairment losses against goodwill by approximately nil, nil, RMB42 million and
RMB42 million, respectively.
According to the “Announcement on Suspending the Collection of the Fund for the Dismantling of Waste
Electronic Products and Electrical Appliances and Related Matters” jointly issued by the Ministry of Finance, the
Ministry of Ecology and Environment, the National Development and Reform Commission, and the Ministry of
Industry and Information Technology on 17 January 2024, the fund for dismantling of waste electronic products and
electrical appliances (“subsidy fund”) will be suspended from 1 January 2024. For waste electronic products and
electrical appliances dismantled before 31 December 2023, and which have not yet been subsidized in accordance
with the “Measures for the Collection and Use of the Fund for the Dismantling of Waste Electronic Products and
Electrical Appliances” (Cai Zong [2012] No. 34) and other regulations, the government will allocate funds to pay.
On 29 March 2024, the Ministry of Finance announced “Draft Measures for the Administration of Special
Funds for the Disposal of Waste Electronic Products and Electrical Appliances”. According to the announcement, the
management is in the view of that the government would allocate special funds and continue to promote the
comprehensive utilisation and circular development of resources.
On 13 September 2024, the latest “Measures for the Administration of Special Funds for the Disposal of Waste
Electronic Products and Electrical Appliances” (Cai Zihuan [2024] No. 119) was officially released. Waste electronic
products and electrical appliances dismantled since 1 January 2024, will adopt a reward-based approach to replace
the previous subsidy policy. As of the end of the Relevant Periods, the management made the best estimation on the
forecasted fund subsidy income based on current information and will review and update this key assumption
periodically.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-66 –


--- page 721 ---
21. INVESTMENTS IN ASSOCIATES AND SUBSIDIARIES
(a) Investments in associates
The Group
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Share of net assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,989 357,819 373,481 2,050
Chijin HK acquired equity interests in Tietto Minerals Limited (“Tietto Minerals”), a listed company in
Australia, through cash subscription, open bidding and secondary market purchase in 2022. As at 31 December 2022,
Chijin HK held 140,855,864 ordinary shares in Tietto Minerals, representing approximately 13.05% of its issued
shares, and the Group became its largest shareholder. Pursuant to the Investment Agreement, the Group has appointed
a non-executive director to Tietto Minerals to exercise significant influence over the operation and management of
Tietto Minerals.
Particulars of the associates are as follows:
Name
Particulars
of issued
shares held
Place of
incorporation/
registration
and business % of ownership interest
Principal
activities
As at
31 December
2021
As at
31 December
2022
As at
31 December
2023
As at
30 September
2024
Shanghai
Chijin Fengyu
New Energy
Technology
Co., Ltd.* /H1118/H1118/H1118/H1118
Ordinary
shares
China 51% 51% 51% 51% Generation
and sale of
electricity
Shanghai
Chijin Enbo
Technology
Partnership
(Limited
Partnership) /H1118/H1118/H1118
Ordinary
shares
China 30% 30% 30% 30% Generation
and sale of
electricity
Shanghai
Enbo Chijin
New Energy
Technology
Co., Ltd. /H1118/H1118/H1118/H1118/H1118
Ordinary
shares
China 30% 30% 30% 30% Generation
and sale of
electricity
Tietto Minerals
Limited**
(“Tietto
Minerals”) /H1118/H1118/H1118/H1118
Ordinary
shares
Australia – 13.05% 12.47% –** Mining
* In accordance with the investment agreement, the Group enjoys 30% voting rights of Shanghai Chijin
Fengyu New Energy Technology Co., Ltd..
** On 30 October 2023, Zhaojin Capital (Hong Kong) Limited (“Zhaojin Capital”), which is an indirect
wholly owned subsidiary of Zhaojin Mining Industry Company Limited, lodged a bidder statement to
the shareholders of Tietto Minerals, pursuant to which it made a conditional offer to acquire all the
outstanding issued shares of Tietto Minerals at an offer price of AUD0.58 per share (and subsequently
increased to AUD0.68 per share on 15 April 2024). According to the resolution made by the Board,
Chijin HK accepted the above offer and transferred all of the 140,855,864 shares of Tietto Minerals to
Zhaojin Capital at a total consideration of AUD95.782 million (RMB456.401 million). This transaction
was settled on 28 June 2024 and the Group holds no interest in Tietto Minerals from then on.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-67 –


--- page 722 ---
Aggregate information of associates that are not individually material:
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Share of the associates’ profit for
the year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(11) (4,104) 9,950 7,197
Share of the associates’ total
comprehensive income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(11) (4,104) 9,950 7,197
Aggregate carrying amount of the
Group’s investments in the
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,989 357,819 373,481 2,050
The Company
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Share of net assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,989 1,729 1,545 1,421
Particulars of the associates are as follows:
Name
Particulars
of issued
shares held
Place of
incorporation/
registration
and business % of ownership interest
Principal
activities
As at
31 December
2021
As at
31 December
2022
As at
31 December
2023
As at
30 September
2024
%%%%
Shanghai
Chijin Fengyu
New Energy
Technology
Co., Ltd.* /H1118/H1118/H1118/H1118
Ordinary
shares
China 51% 51% 51% 51% Generation
and sale of
electricity
* In accordance with the investment agreement, the Company enjoys 30% voting rights of Shanghai Chijin
Fengyu New Energy Technology Co., Ltd..
Aggregate information of associates that are not individually material:
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Share of the associates’ profit for
the year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(11) (261) (184) (124)
Share of the associates’ total
comprehensive income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(11) (261) (184) (124)
Aggregate carrying amount of the
Group’s investments in the
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,989 1,729 1,545 1,421
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-68 –


--- page 723 ---
(b) Investments in subsidiaries
The Company
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Investments, at cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,240,871 6,134,845 6,217,346 6,390,746
Less: Impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––––
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,240,871 6,134,845 6,217,346 6,390,746
Particulars of the subsidiaries, which are directly owned by the Company, are included in note 1 to the
Historical Financial Information.
22. DEFERRED TAX
For presentation purposes, certain deferred tax assets and liabilities have been offset. The following is the
analysis of the deferred tax balances for financial reporting purposes:
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Deferred tax assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,215 53,978 17,482 55,555
Deferred tax liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,916 2,455,981 2,314,654 2,245,052
Deferred tax assets have not been recognised in respect of the following items:
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Deductible temporary differences /H1118/H1118 695 2,180 293 492
Deductible tax losses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118194,357 264,141 293,140 320,872
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118195,052 266,321 293,433 321,364
The unrecognised income tax losses, which have fixed expiry dates, will expire in the following years:
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
31 December 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111835,15 5–––
31 December 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111835,327 35,327 – –
31 December 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111849,556 37,569 37,569 35,025
31 December 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111846,426 46,426 48,168 26,033
31 December 2026 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111827,893 46,219 46,219 46,219
31 December 2027 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 98,600 98,315 98,315
31 December 2028 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 62,869 62,869
31 December 2029 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 52,411
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118194,357 264,141 293,140 320,872
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-69 –


--- page 724 ---
The movements in deferred tax assets and liabilities during the year/period, without taking into consideration the offsetting of the balance within the same tax jurisdiction, are
as follows:
Deferred tax assets
Impairment
of property,
plant and
equipment
Impairment
losses on
accounts
receivable
and other
receivables,
net of
reversal
(Reversal of)/
provision for
impairment
of inventories
Environmental
rehabilitation
Deferred
income
Deductible
tax losses
Fair value
adjustments
on financial
liabilities at
fair value
through
profit or loss
Lease
liabilities
Accelerated
depreciation
of property,
plant and
equipment Others Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
At 1 January 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118721 514 988 1,197 257 1,239 – – 40,466 – 45,382
Credited/(charged) to the statement of
profit or loss (note 14) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 174 (95) (54) (38) (155) 467 – (39,541) – (39,242)
Exchange realignment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–– – ––––– (925) – (925)
At 31 December 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118721 688 893 1,143 219 1,084 467 – – – 5,215
Credited/(charged) to the statement of
profit or loss (note 14) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(721) 141 89 26,156 78 1,364 4,562 24,743 – 12,492 68,904
Acquisition of subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 25,395 – – – 41,433 – – 66,828
Exchange realignment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 2,406 – – – 3,876 – – 6,282
At 31 December 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 829 982 55,100 297 2,448 5,029 70,052 – 12,492 147,229
Credited/(charged) to the statement of
profit or loss (note 14) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 295 1,714 (931) (46) 211 9,514 (7,508) – (987) 2,262
Exchange realignment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 737 – – – 1,188 – – 1,925
At 31 December 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,124 2,696 54,906 251 2,659 14,543 63,732 – 11,505 151,416
Credited/(charged) to the statement of
profit or loss (note 14) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (303) (1,715) (977) 777 (2,659) 12,489 (5,021) 33,919 (1,580) 34,930
Credited to other comprehensive income /H1118/H1118/H1118 – – – – – – 2,507 – – – 2,507
Exchange realignment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – (457) – – – (678) – – (1,135)
At 30 September 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 821 981 53,472 1,028 – 29,539 58,033 33,919 9,925 187,718
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-70 –


--- page 725 ---
Deferred tax liabilities
Fair value adjustments
on financial assets
at fair value through
profit or loss
Accelerated
depreciation of
property, plant
and equipment
Environmental
rehabilitation
Fair value adjustment
arising from acquisition
of subsidiaries
Right-of-use
assets Others Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
At 1 January 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,485 – – – – – 1,485
Charged/(credited) to the statement of profit or loss
(note 14) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,485) 950 – – – – (535)
Credited to other comprehensive income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118966 – – – – – 966
At 31 December 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118966 950 – – – – 1,916
Charged/(credited) to the statement of profit or loss
(note 14) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111887 38,501 11,045 37,078 17,406 13,667 117,784
Credited to other comprehensive income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(965) – – – – – (965)
Acquisition of subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 295,189 – 1,886,451 44,523 – 2,226,163
Exchange realignment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 44,170 – 156,539 3,625 – 204,334
At 31 December 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111888 378,810 11,045 2,080,068 65,554 13,667 2,549,232
Charged/(credited) to the statement of profit or loss
(note 14) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,020 (27,381) 824 (110,919) (7,850) (90) (143,396)
Exchange realignment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 6,367 – 35,272 1,113 – 42,752
At 31 December 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,108 357,796 11,869 2,004,421 58,817 13,577 2,448,588
Charged/(credited) to the statement of profit or loss
(note 14) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,408 17,771 (434) (57,694) (6,630) (3,086) (45,665)
Exchange realignment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (3,772) – (21,310) (626) – (25,708)
At 30 September 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,516 371,795 11,435 1,925,417 51,561 10,491 2,377,215
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-71 –


--- page 726 ---
23. OTHER NON-CURRENT ASSETS
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Advance payment for engineering
construction and equipment /H1118/H1118/H1118/H1118/H111826,819 56,402 105,810 41,674
Funds for land restoration and
environmental rehabilitation after
mine closure /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111898,384 83,130 102,974 110,208
Large certificates of bank deposits
and interest /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111842,118 42,118 – –
Prepayment for equity acquisition
(note 52) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 66,844
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818,909 5,976 3,286 1,957
Subtotal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118186,230 187,626 212,070 220,683
Less: amount due within one year /H1118/H1118 – (42,118) – –
186,230 145,508 212,070 220,683
As at 31 December 2021, 31 December 2022 and 31 December 2023 and 30 September 2024, the Group’s
assets with restriction (including amounts due within one year) were RMB140,502,000, RMB125,248,000
RMB102,974,000 and RMB110,208,000, respectively, which were comprise of large certificates of bank deposits and
interest and funds for land restoration and environmental rehabilitation after mine closure that cannot be withdrawn
at any time.
24. INVENTORIES
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Raw materials /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118516,090 951,720 971,389 971,689
Consumable materials /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,486 680 610 545
Work in progress /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,112,679 1,288,300 1,457,052 1,567,218
Finished goods /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111880,577 174,052 168,779 106,280
1,710,832 2,414,752 2,597,830 2,645,732
Impairment provision
Raw materials /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(127,331) (143,175) (178,411) (194,212)
Work in progress /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(170,777) (90,588) (906) –
Finished goods /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(630) (16,361) (11,604) (1,850)
(298,738) (250,124) (190,921) (196,062)
1,412,094 2,164,628 2,406,909 2,449,670
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-72 –


--- page 727 ---
25. TRADE RECEIV ABLES FROM THE COMPREHENSIVE RESOURCES RECYCLING AND
UTILISATION
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Trade receivables from the Ministry
of Ecology and Environment of
the People’s Republic of China /H1118/H1118 311,447 339,237 397,481 443,286
The trade receivables from Guangyuan Technology, which renders comprehensive resource recycling and
utilisation services to the government, are non-interest-bearing and have no fixed credit periods.
An ageing analysis of the trade receivables as at the end of each of the Relevant Periods, based on the invoice
date, is as follows:
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Less than 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111869,680 74,704 92,642 69,890
1 to 2 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111883,630 69,680 74,704 88,476
2 to 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118158,121 83,630 69,680 73,895
Over 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111816 111,223 160,455 211,025
311,447 339,237 397,481 443,286
In the opinion of the directors of the Company, the expected credit losses are limited because the trade
receivable balances are due from the Ministry of Ecology and Environment of the PRC, which is with a high
reputation and no actual loss incurred in history.
26. TRADE RECEIV ABLES FROM GOLD AND COMMODITIES SALES
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Trade receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111826,334 30,097 115,750 163,455
Impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,074) (460) (18) –
25,260 29,637 115,732 163,455
The credit period for receivables of other companies selling major metals such as gold, copper, zinc and
electrolytic copper is generally within 60 days. Trade receivables are non-interest-bearing.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-73 –


--- page 728 ---
An ageing analysis of the trade receivables as at the end of each of the Relevant Periods, based on the invoice
date, is as follows:
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Less than 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825,210 29,637 115,732 163,455
2 to 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 0–––
25,260 29,637 115,732 163,455
The movements in the loss allowance for impairment of trade receivables are as follows:
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
At beginning of year/period /H1118/H1118/H1118/H1118/H1118/H1118296 1,074 460 18
Impairment provided /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118778 – 18 –
Impairment reversed /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (158) (460) (18)
Amount written off as uncollectible /H1118 – (456) – –
At end of year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,074 460 18 –
The Group applies the simplified approach in calculating ECLs for trade receivables. Trade receivables relating
to customers with known financial difficulties or significant doubt on collection are assessed individually for
impairment allowance. The remaining trade receivables are grouped and collectively assessed for impairment
allowance. Under the collective approach, an impairment analysis is performed at each reporting date using a
provision matrix to measure expected credit losses. The provision rates are based on ageing of bills for groupings of
various customer segments with similar loss patterns. The calculation reflects the probability-weighted outcome, the
time value of money and reasonable and supportable information that is available at the reporting date about past
events, current conditions and forecasts of future economic conditions.
In the opinion of the directors of the Company, the expected credit losses are limited because the trade
receivable balances are mainly due from customers with high reputation, and the trade receivables were settled within
a short subsequent period in history.
Set out below is the information about the credit risk exposure on the Group’s trade receivables using a
provision matrix:
As at 31 December 2021
Expected credit
loss rate
Gross carrying
amount
Expected credit
losses
Net carrying
amount
RMB’000 RMB’000 RMB’000
Provision on collective basis
Aged less than 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.59% 25,879 669 25,210
Aged 2 to 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111850.00% 100 50 50
Aged over 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118100.00% 355 355 –
At end of year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184.08% 26,334 1,074 25,260
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-74 –


--- page 729 ---
As at 31 December 2022
Expected credit
loss rate
Gross carrying
amount
Expected credit
losses
Net carrying
amount
RMB’000 RMB’000 RMB’000
Provision on collective basis
Aged less than 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.53% 30,097 460 29,637
At end of year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.53% 30,097 460 29,637
As at 31 December 2023
Expected credit
loss rate
Gross carrying
amount
Expected credit
losses
Net carrying
amount
RMB’000 RMB’000 RMB’000
Provision on collective basis
Aged less than 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.02% 115,750 18 115,732
At end of year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.02% 115,750 18 115,732
As at 30 September 2024
Expected credit
loss rate
Gross carrying
amount
Expected credit
losses
Net carrying
amount
RMB’000 RMB’000 RMB’000
Provision on collective basis
Aged less than 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 163,455 – 163,455
At end of period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 163,455 – 163,455
27. PREPAYMENTS, OTHER RECEIV ABLES AND OTHER ASSETS
The Group
Note
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Prepayments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111850,037 99,560 83,944 240,266
Deposits and other receivables 120,194 58,134 180,497 202,593
Receivables from disposal of
SIP II shares (note 40) /H1118/H1118/H1118 – – – 323,647
Large certificates of bank
deposits and interest /H1118/H1118/H1118/H1118/H1118 – 42,118 – –
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111851 46,471 25,177 53,080
Less: Impairment of other
receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(a) (3,338) (4,140) (7,022) (5,416)
166,944 242,143 282,596 814,170
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-75 –


--- page 730 ---
The amount of deposits and other receivables mainly is deposits for futures.
(a) The movements in the loss allowance for impairment of other receivables are as follows:
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
At beginning of year/period /H1118/H1118/H1118/H1118/H1118/H11182,132 3,338 4,140 7,022
Impairment provided /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,206 2,165 3,873 195
Impairment reversed /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (1,363) (991) (1,801)
At end of year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,338 4,140 7,022 5,416
The Company
Notes
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Prepayments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186 776 – 208
Deposits and other receivables 392,123 332,091 589,427 577,632
Receivables from disposal of
SIP II shares (note 40) /H1118/H1118/H1118 – – – 323,647
Dividends receivable (note) /H1118/H1118 – – 600,000 –
Less: Impairment of other
receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(b) (39) (19) (11) –
392,090 332,848 1,189,416 901,487
Note: Dividends receivable were from domestic subsidiaries of the Company with no collection restriction.
(a) An ageing analysis of the prepayments, other receivables and other assets as at the end of each of the
Relevant Periods is as follows:
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Less than 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118389,811 332,848 861,251 815,382
1 to 2 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,279 – 328,165 86,105
392,090 332,848 1,189,416 901,487
(b) The movements in the loss allowance for impairment of other receivables are as follows:
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
At beginning of year/period /H1118/H1118/H1118/H1118/H1118/H111811 39 19 11
Impairment provided /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182 8–––
Impairment reversed /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (20) (8) (11)
At end of year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111839 19 11 –
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-76 –


--- page 731 ---
28. FINANCIAL ASSETS AT FAIR V ALUE THROUGH PROFIT OR LOSS
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Listed equity investments,
at fair value /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811,237 48,131 16,909 13,204
11,237 48,131 16,909 13,204
29. DERIV ATIVE FINANCIAL INSTRUMENTS
Derivative financial asset:
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Commodity derivative contracts /H1118/H1118/H1118 6,436 584 13,470 43,438
6,436 584 13,470 43,438
Derivative financial liability:
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Commodity derivative contracts /H1118/H1118/H1118 1,831 – – 17,002
1,831 – – 17,002
As at 31 December 2021, 2022, 2023 and 30 September 2024, the amount of commodity derivative contracts
is RMB6,436,000, RMB584,000, RMB13,470,000 and RMB43,438,000, in response to the price risk of short
exposure derived from gold leasing and the sale of gold.
30. CASH AND CASH EQUIV ALENTS, AND RESTRICTED CASH
The Group
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Cash and bank balances /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,824,749 1,285,105 1,662,283 2,397,757
Less: Restricted cash /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(116,881) (232,560) (387,648) (303,616)
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H11181,707,868 1,052,545 1,274,635 2,094,141
Denominated in:
RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,668,994 924,053 1,111,394 1,221,213
USD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118144,718 344,993 500,385 938,127
GBP /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 554 1,728 3,285
LAK /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811,009 5,460 1,369 11,871
GH₵ /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 5,870 45,163 128,728
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111828 4,175 2,244 94,533
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,824,749 1,285,105 1,662,283 2,397,757
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-77 –


--- page 732 ---
As at 31 December 2021, 2022, 2023 and 30 September 2024, the Group’s bank balances of approximately
RMB116,881,000, RMB232,560,000, RMB387,648,000 and RMB303,616,000 were deposited for the following
business and were restricted for use, respectively:
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Bank deposits for loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 13,965 13,965 –
Deposits for notes payable /H1118/H1118/H1118/H1118/H1118/H1118– 20,400 – –
Special fund deposits for
environmental rehabilitation and
restoration /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,050 18,194 9,825 6,619
Bank deposits for the gold lease
business /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,003 100,001 263,858 296,997
Certificates of deposit due within
one year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118100,095 80,000 100,000 –
Deposits for investment funds /H1118/H1118/H1118/H11182,73 3–––
116,881 232,560 387,648 303,616
The Company
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Cash and bank balances /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,029,019 401,708 244,170 359,803
Less: Restricted cash /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (13,965) –
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H11181,029,019 401,708 230,205 359,803
Denominated in:
RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,029,019 401,706 243,377 308,540
USD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 2 793 51,263
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,029,019 401,708 244,170 359,803
As at 31 December 2021, 2022, 2023 and 30 September 2024, the Group’s bank balances of approximately nil,
nil, RMB13,965,000, nil were deposited for loans and were restricted for use, respectively:
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Bank deposits for loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 13,965 –
The RMB is not freely convertible into other currencies, however, under Chinese Mainland’s Foreign
Exchange Control Regulations and Administration of Settlement, and Sale and Payment of Foreign Exchange
Regulations, the Group is permitted to exchange RMB for other currencies through banks authorised to conduct
foreign exchange business.
Cash at banks earns interest at floating rates based on daily bank deposit rates. The bank balances and
restricted cash are deposited with creditworthy banks with no recent history of default.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-78 –


--- page 733 ---
31. FINANCIAL LIABILITIES AT FAIR V ALUE THROUGH PROFIT OR LOSS
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Gold lease /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118387,683 620,250 939,996 1,026,210
387,683 620,250 939,996 1,026,210
The Group entered into gold lease contracts with certain banks for financing purposes, the Group leased gold
from the banks and sold it through the trading system of the Shanghai Gold Exchange, the Group then purchased the
same quantity and specification of gold through the aforesaid system to repay the banks before the maturity date of
the gold lease contracts, and paid the agreed lease fee in accordance with the gold lease contracts (generally paid on
the same date of the bank’s quarterly interest payment date). The gold lease term is generally within 1 year inclusive.
The liabilities to purchase and pay back the gold physically are measured at the price of the specified gold on the
Shanghai Gold Exchange, the balance of the gold lease at the year/period end represents the fair value of the gold
leased from banks at each of the balance sheet date.
32. TRADE AND NOTES PAYABLES
Trade payables do not bear interest and are usually settled within 60 days.
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Trade payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118440,401 693,390 552,457 636,817
Notes payable /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 158,000 – –
440,401 851,390 552,457 636,817
The trade payables are non-interest-bearing and are normally settled on 60-day terms.
An ageing analysis of trade and notes payables as at the end of each of the Relevant Periods is as follows:
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Less than 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118440,401 851,390 552,457 636,817
33. CONTRACT LIABILITIES
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Short-term advances received
from customers
Sale of goods /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,547 1,227 9,162 17,323
Metal Streaming Arrangement
(note) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 60,825 64,015 71,849
Sub-total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,547 62,052 73,177 89,172
Long-term advances received
from customers
Metal Streaming Arrangement
(note) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 606,298 576,999 538,996
4,547 668,350 650,176 628,168
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-79 –


--- page 734 ---
Note: GSR which was acquired by the Group in 2022 has following transaction: In May 2015, one subsidiary
of GSR, Caystar Finance Co. entered into a gold purchase and sale agreement (the “Metal Streaming
Arrangement”) with RGLD Gold AG, in which GSR obtained USD145,000,000 from RGLD Gold AG,
in exchange, GSR is required to deliver 10.5% of future gold production of its two subsidiaries at a cash
purchase price of 20% of the spot gold price until 240,000 ounces of gold have been delivered (“Tier
One”). Thereafter, 5.5% of the gold production will be delivered at a cash purchase price of 30% of the
spot gold price (“Tier Two”). As at 31 December 2022 and 2023 and 30 September 2024, GSR has
delivered accumulative total 153,399 ounces, 170,096 ounces, and 184,792 ounces of gold to RGLD
Gold AG, respectively.
The Group expects that the delivery obligation of the Metal Streaming Arrangement will be satisfied in 2037.
The changes of contract liabilities — Metal Streaming Arrangement from 31 January 2022 (the acquisition date
of GSR) to 31 December 2022, 2023 and 30 September 2024 are as follows:
Gold delivery
obligation
Balance as at 31 January 2022 (note 50) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118640,754
Revenue recognised from delivery of goods /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(47,201)
Finance expenses (note 12) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815,393
Exchange differences /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111858,177
Balance as at 31 December 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118667,123
Including: Contract liabilities due within one year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111860,825
Contract liabilities more than one year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118606,298
Revenue recognised from delivery of goods /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(52,324)
Finance expenses (note 12) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815,093
Exchange differences /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811,122
Balance as at 31 December 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118641,014
Including: Contract liabilities due within one year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111864,015
Contract liabilities more than one year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118576,999
Revenue recognised from delivery of goods /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(44,749)
Finance expenses (note 12) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111821,059
Exchange differences /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(6,479)
Balance as at 30 September 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118610,845
Including: Contract liabilities due within one year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111871,849
Contract liabilities more than one year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118538,996
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-80 –


--- page 735 ---
34. OTHER PAYABLES AND ACCRUALS
The Group
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Amounts due to related parties
– trade /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–4 12 2 2
– non-trade /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 410,940 128,525 –
Payables to contractors /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,926 6,319 85,195 116,158
Consideration payables for acquiring
a subsidiary /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 40,800 40,800
Engineering Quality Guarantee
Deposit /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111827,803 33,507 40,984 39,885
Salaries, wages and benefits
payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118104,693 114,454 174,859 111,078
Taxes other than income tax
payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111853,999 93,558 205,293 142,504
Payables to eligible participants
of the SIP II (note 40) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 323,647
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,748 36,517 21,769 18,229
191,169 695,336 697,447 792,303
The Company
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Amounts due to related parties
– trade /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–4 12 2 2
– non-trade /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118951,096 746,768 574,025 747,237
Payables to eligible participants of
the SIP II (note 40) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 323,647
Consideration payables for acquiring
a subsidiary /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 40,800 40,800
Salaries, wages and benefits
payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111817,536 3,969 9,478 1,651
Taxes other than income tax
payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118792 951 536 711
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118123 140 84 40
969,547 751,869 624,945 1,114,088
35. SHORT-TERM LOANS
The Group
31 December 2021 31 December 2022 31 December 2023 30 September 2024
Effective
interest
rate Maturity
Effective
interest
rate Maturity
Effective
interest
rate Maturity
Effective
interest
rate Maturity
(%) RMB’000 (%) RMB’000 (%) RMB’000 (%) RMB’000
Unsecured /H1118/H1118/H1118/H1118/H1118– – 2.61-3.90 2023 236,636 2.45-7.50 2024 850,009 2.35-6.30 2024-2025 822,730
Secured /H1118/H1118/H1118/H1118/H1118/H1118– – 3.70 2023 251,773 – –
– 488,409 850,009 822,730
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-81 –


--- page 736 ---
The carrying amounts of borrowings are denominated in the following currencies:
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 383,940 820,009 682,326
USD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 104,469 – 140,404
LAK /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 30,000 –
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 488,409 850,009 822,730
i. As at 31 December 2022, the Group’s secured borrowings included in the short-term borrowings were
approximately RMB251,773,000, which were pledged by property, plant and equipment with a book
value of RMB270,931,000.
ii. As at 31 December 2021, 2022 and 2023 and 30 September 2024, the Group had no short-term
borrowings due but unpaid.
The Company
31 December 2021 31 December 2022 31 December 2023 30 September 2024
Effective
interest
rate Maturity
Effective
interest
rate Maturity
Effective
interest
rate Maturity
Effective
interest
rate Maturity
(%) RMB’000 (%) RMB’000 (%) RMB’000 (%) RMB’000
Unsecured /H1118/H1118/H1118/H1118/H1118– – 2.61 2023 106,847 2.45-4.50 2024 600,637 2.35-2.70 2024-2025 265,460
Secured /H1118/H1118/H1118/H1118/H1118/H1118– – 3.70 2023 251,773 – – –
– 358,620 600,637 265,460
The carrying amounts of borrowings are denominated in the following currencies:
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 254,151 600,637 265,460
USD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 104,469 – –
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 358,620 600,637 265,460
i. As at 31 December 2022, the Company’s secured borrowings included in the short-term borrowings
were approximately RMB251,773,000, which were pledged by property, plant and equipment with a
book value of RMB270,931,000.
ii. As at 31 December 2021, 2022 and 2023 and 30 September 2024, the Company had no short-term
borrowings due but unpaid.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-82 –


--- page 737 ---
36. LONG-TERM LOANS
The Group
31 December 2021 31 December 2022 31 December 2023 30 September 2024
Effective
interest
rate Maturity
Effective
interest
rate Maturity
Effective
interest
rate Maturity
Effective
interest
rate Maturity
(%) RMB’000 (%) RMB’000 (%) RMB’000 (%) RMB’000
Current portion of
long-term bank
loans – secured /H1118 4.10-4.95 2023 245,850 4.00-9.15 2024 129,456 4.00-9.10 2025 531,580
Current portion of
long-term bank
loans –
unsecured /H1118/H1118/H1118/H11183.48 2022 25,530 3.50-4.00 2023 87,920 3.50-4.10 2024 88,859 3.50-6.30 2025 110,198
Total – current /H1118/H1118/H1118 25,530 333,770 218,315 641,778
Long-term loans –
secured /H1118/H1118/H1118/H1118/H1118 – 4.10-4.95 2024-2027 1,386,724 4.00-9.15 2025-2027 1,381,994 4.00-9.10 2025-2027 485,047
Long-term loans –
unsecured /H1118/H1118/H1118/H1118 – 3.50-4.00 2024-2027 127,057 3.50-4.10 2025-2027 39,980 3.50-6.30 2025-2027 196,567
Total – non-current /H1118 – 1,513,781 1,421,974 681,614
25,530 1,847,551 1,640,289 1,323,392
The carrying amounts of borrowings are denominated in the following currencies:
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,046,622 914,312 844,640
USD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825,530 800,929 725,977 478,752
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825,530 1,847,551 1,640,289 1,323,392
i. Certain of the Group’s long-term loans are pledged by:
a. Total equity interests in Wulong Mining, Jilong Mining and Chijin HK as of 31 December 2022
and 2023 and 30 September 2024;
b. Property, plant and equipment (mineral assets) with carrying amounts of approximately nil,
RMB279,388,000 and RMB264,894,000 as of 31 December 2022, 2023 and 30 September 2024.
c. Other intangible asset with carrying amounts of approximately RMB5,562,378,000,
RMB5,426,490,000 and RMB5,249,981,000 as of 31 December 2022 and 2023 and 30 September
2024.
ii. Certain of the Group’s long-term loans amounting to RMB25,530,000, RMB214,977,000,
RMB128,839,000 and RMB306,765,000 as of 31 December 2022 and 2023 and 30 September 2024 were
guaranteed by the Company.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-83 –


--- page 738 ---
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Analysed into:
Long-term loans:
Within one year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825,530 333,770 218,315 641,778
After 1 year but within 2 years /H1118/H1118 – 306,969 987,758 393,113
After 2 years but within 5 years /H1118/H1118 – 1,206,812 434,216 288,501
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825,530 1,847,551 1,640,289 1,323,392
The Company
31 December 2021 31 December 2022 31 December 2023 30 September 2024
Effective
interest
rate Maturity
Effective
interest
rate Maturity
Effective
interest
rate Maturity
Effective
interest
rate Maturity
(%) RMB’000 (%) RMB’000 (%) RMB’000 (%) RMB’000
Current portion of
long-term bank
loans – secured /H1118 – – 4.95 2023 237,831 4.00-4.35 2024 119,251 4.00-4.35 2025 319,598
Long-term loans –
secured /H1118/H1118/H1118/H1118/H1118– – 4.95 2024-2027 774,895 4.00-4.35 2025-2027 753,470 4.00-4.35 2026-2027 485,047
– 1,012,726 872,721 804,645
i. Certain of the Company’s long-term loans are pledged by:
a. Total equity interests of Wulong Mining, Jilong Mining and Chijin HK as of 31 December 2022
and 2023 and 30 September 2024;
b. Property, plant and equipment with a carrying amount of approximately nil, RMB279,388,000,
RMB264,894,000 as of 31 December 2022, 2023 and 30 September 2024.
c. Other intangible asset with carrying amounts of approximately RMB67,986,000, RMB59,106,000
and RMB56,080,000 as of 31 December 2022 and 2023 and 30 September 2024.
ii. As at 31 December 2021, 2022 and 2023 and 30 September 2024, all the long-term borrowings were
denominated in RMB.
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Analysed into:
Long-term loans:
Within one year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 237,831 119,251 319,598
After 1 year but within 2 years /H1118/H1118 – 219,871 319,254 323,132
After 2 years but within 5 years /H1118/H1118 – 555,024 434,216 161,915
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,012,726 872,721 804,645
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-84 –


--- page 739 ---
37. PROVISIONS
Pursuant to the regulations of the governmental authorities in the places where the mines are located, the Group
recognises provision for environmental rehabilitation and restoration of mines. The amount of provision is an
estimate based upon the life of mining tenements, timing of mine closure and cost of such rehabilitation. The
management will update the estimation basis annually.
The movement in the present value of the provision for rehabilitation are as follows:
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Beginning balance /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,652,620 1,631,259 1,994,401 1,943,846
Acquisition of a subsidiary
(note 50) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 108,800 – –
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,550 101,174 4,953 –
Accretion of interest recognized
during the year/period (note 12) /H1118/H1118/H1118 8,393 8,895 9,409 7,075
Payment during the year/period /H1118/H1118/H1118/H1118/H1118(4,554) (11,583) (97,102) (78,901)
Exchange realignment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(37,750) 155,856 32,185 (18,868)
Ending balance /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,631,259 1,994,401 1,943,846 1,853,152
Current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 9,567 75,747 71,806
Non-current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,631,259 1,984,834 1,868,099 1,781,346
38. OTHER NON-CURRENT LIABILITIES
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Payables for mining rights (note i) /H1118/H1118 85,716 73,186 71,960 64,167
Payables for equity transfer (note ii) /H1118 173,566 – – –
Deferred government grants /H1118/H1118/H1118/H1118/H1118/H1118/H11182,120 2,073 1,756 6,918
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118261,402 75,259 73,716 71,085
Current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118186,589 10,849 9,485 5,717
Non-current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111874,813 64,410 64,231 65,368
Note i: Payables for mining rights were comprise of the long-term payables to local regulators of Liaoning
Wulong Gold Mining Co., Ltd., Eryuan Jintai Mining Development Co., Ltd. and Chifeng Huatai
Mining Co., Ltd., the subsidiaries of the Company, to obtain certain mining rights.
Note ii: The payables for equity transfer referred to the payments that the Company should made to the
former shareholder, MMG Finance Limited (“MMG”), for the acquisition of the subsidiary, Lane
Xang Minerals Limited Company (“LXML”) in 2018. According to the acquisition agreement, the
final payment should be made in 2021. In 2021, the two parties agreed to extend the final payment
to 2022 after negotiation. Therefore, as at 31 December 2021, the equity transfer payable to MMG
amounting to RMB173,566,000 was presented as the current portion of non-current liabilities. The
payment was made in full in 2022.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-85 –


--- page 740 ---
39. SHARE CAPITAL
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Issued and fully paid: /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,663,911 1,663,911 1,663,911 1,663,911
1,663,911 1,663,911 1,663,911 1,663,911
A summary of movements in the Company’s share capital is as follows:
Number of
shares in issue Share capital
RMB’000
At 1 January 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,663,911,378 1,663,911
At 31 December 2021 and 1 January 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,663,911,378 1,663,911
At 31 December 2022 and 1 January 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,663,911,378 1,663,911
At 31 December 2023 and 1 January 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,663,911,378 1,663,911
At 30 September 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,663,911,378 1,663,911
40. SHARE INCENTIVE PLAN
Employee Stock Ownership Plan
i. Phase I Employee Stock Ownership Plan
The Company operates a share incentive plan (the “SIP I”), namely “Phase I Employee Stock Ownership Plan”,
for the purpose of providing incentives and rewards to eligible participants who contribute to the success of the
Group’s operations. Eligible participants of the SIP I include the directors, supervisors, senior management and other
key employees of the Group. The SIP I became effective on 17 August 2021 and, unless otherwise cancelled or
amended, will remain in force for three years from that date.
In order to implement the SIP I, Beijing Pan Geng Capital Management Co., Ltd. (“Pan Geng Capital”) was
established and designated as the share incentive platform to hold the shares specially awarded to the eligible
participants as the ultimate beneficial owners.
Up to 30 April 2021, the Company repurchased a total of 41,597,732 shares, amounting to RMB663,387,000,
with an average price of RMB15.96 per share to implement the SIP I.
On 17 August 2021, all the 41,597,732 shares were transferred to the share incentive platform with the price
of RMB15.96 per share. As a result, a consideration of RMB663,387,000 has been received by the Company. At the
same day, 117 participants were granted 41,597,732 shares at a subscribed price of RMB15.96 per share. Due to the
Group can not control the share incentive platform, the share incentive platform was not consolidated in the
consolidated financial statements.
The SIP I became effective on 17 August 2021 and, unless otherwise cancelled or amended, will remain in
force for 36 months from the Grant date.
All of the shares granted to the participants shall be subject to a performance-based condition (the
“Performance Condition”). The Performance Condition would be satisfied that the cumulative production of the
Group from 2022 to 2024 is not less than 43 tons.
On 17 August 2021, as the market price of shares was RMB15.18 per share, lower than the exercise price of
RMB15.96 per share, the fair value of the shares granted under the SIP I during the Relevant Periods was nil, and
the Group recognised no expenses during the Relevant Periods.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-86 –


--- page 741 ---
The movements of shares under the SIP I during the year are as follows:
2021 2022 2023
For the nine months
ended 30 September
2024
Weighted
average
exercise
price
Number of
shares
Weighted
average
exercise
price
Number of
shares
Weighted
average
exercise
price
Number of
shares
Weighted
average
exercise
price
Number of
shares
RMB ’000 RMB ’000 RMB ’000 RMB ’000
per share per share per share per share
At 1 January /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 15.96 41,598 15.96 41,598 15.96 41,598
Granted during the
year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815.96 41,598 – – – – – –
At 31 December/
30 September /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815.96 41,598 15.96 41,598 15.96 41,598 15.96 41,598
ii. Phase II Employee Stock Ownership Plan
The Company operates a share incentive plan (the “SIP II”), namely “Phase II Employee Stock Ownership
Plan”, for the purpose of providing incentives and rewards to eligible participants who contribute to the success of
the Group’s operations. Eligible participants of the SIP II include the directors, supervisors, senior management and
other key employees of the Group. The SIP II became effective on 28 April 2023 and, unless otherwise cancelled or
amended, will remain in force for two years from that date.
Up to 16 January 2023, the Company repurchased a total of 16,575,406 shares, amounting to
RMB300,910,000, with an average price of RMB18.15 per share to implement the SIP II.
On 28 April 2023, 101 participants were granted 16,575,406 shares at a subscribed price of RMB18.15 per
share. On 28 April 2023, the Company received the whole repurchase fee of RMB300,910,000 from all the
participants.
The SIP II became effective on 28 April 2023 and, unless otherwise cancelled or amended, will remain in force
for 24 months from that date.
All of the shares granted to the participants shall be subject to a performance-based condition (the
“Performance Condition”). The Performance Condition would be satisfied that the net profit attributable to
shareholders of Company in 2023 increases by more than 30% (inclusive) over the same period of last year.
As of 31 December 2023, all shares of the SIP II were vested as the Performance Condition was satisfied. As
of 30 September 2024, the Company sold out all shares of the SIP II on behalf of the eligible participants, and
receivables from the securities company and payables to the eligible participants were recorded accordingly. Up to
31 October 2024, all the receivables and payables were settled.
On 28 April 2023, as the market price of shares was RMB16.57 per share, lower than the exercise price of
RMB18.15 per share, the fair value of the shares granted under the SIP II during the Relevant Periods was nil, and
the Group recognised no expenses during the Relevant Periods.
The movements of shares under the SIP II during the year are as follows:
2023
For the nine months ended
30 September 2024
Weighted average
exercise price Number of shares
Weighted average
exercise price Number of shares
RMB ’000 RMB ’000
per share per share
At 1 January /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 18.15 16,575
Granted during the year/period /H1118/H1118/H1118/H111818.15 16,575 – –
Exercised during the year/period /H1118/H1118/H1118 – – (18.15) 16,575
At 31 December/30 September /H1118/H1118/H1118/H1118 16,575 –
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-87 –


--- page 742 ---
iii. Stock Appreciation Rights
The Company operates a share incentive plan (the “SIP III”), namely “Stock Appreciation Rights”, for the
purpose of providing incentives and rewards to eligible participants who contribute to the success of the Group’s
operations. Eligible participants of the SIP III include the directors and senior management of the Group. The SIP
III became effective on 28 November 2022 and, unless otherwise cancelled or amended, will remain in force for four
years from that date.
On 28 November 2022, 7 participants were granted 1,800,000 phantom stock options at a subscribed price of
RMB16.00. These phantom stock options will be settled by cash.
All of the options granted to the participants shall be subject to a service-based condition (the “Service
Condition”). The Performance Condition would be satisfied that the cumulative production of the Group of 2022 is
not less than 16 tons (“Phase I”) and the cumulative production of the Group from 2022 to 2023 is not less than 35
tons (“Phase II”). Under Phase I, the participants could exercise a maximum of 50% of the options from 28 November
2023 to 27 November 2024. Under Phase II, the participants could exercise a maximum of 50% of the options from
28 November 2024 to 27 November 2025.
On 30 September 2024, since the Service Condition was not met, the SIP III were forfeited and no expenses
were recognised during the Relevant Periods.
41. RESERVES
The amounts of the Group’s reserves and the movements therein for the Relevant Periods are presented in the
consolidated statements of changes in equity of the Historical Financial Information.
Pursuant to the relevant laws and regulations and the articles of association of the Company, the Company is
required to transfer 10% of its profit after income tax, as determined under PRC GAAP , to the reserve fund until the
reserve balance reaches 50% of its registered capital. The transfer to this reserve must be made before the distribution
of dividends to equity owners. Upon the approval from the relevant authorities, this reserve can be used to make up
any losses incurred or to increase share capital. Except for offsetting against losses, this reserve cannot fall below
25% of the registered share capital after being used to increase share capital. The reserves available for distribution
to shareholders are the retained profits.
42. PARTLY-OWNED SUBSIDIARIES WITH MATERIAL NON-CONTROLLING INTERESTS
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2024
Percentage of equity interest held by
non-controlling interests:
Guangyuan Technology /H1118/H1118/H1118/H1118/H1118/H1118/H111845% 45% 45% 45%
LXML /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810% 10% 10% 10%
GSR /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118NA 38% 38% 38%
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Profit for the year allocated to
non-controlling interests:
Guangyuan Technology /H1118/H1118/H1118/H1118/H1118/H1118/H111813,045 10,811 9,859 4,513
LXML /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818,570 23,106 28,655 34,386
GSR /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118NA 9,124 21,857 79,726
Dividends paid to non-controlling
interests
Guangyuan Technology /H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,350 – –
LXML /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 39,641 – –
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-88 –


--- page 743 ---
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Accumulated balances of
non-controlling interests at
Relevant Periods:
Guangyuan Technology /H1118/H1118/H1118/H1118/H1118/H1118/H1118130,920 140,381 150,240 154,753
LXML /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118249,573 255,440 288,670 318,837
GSR /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118NA 1,795,527 1,843,184 1,904,212
Y ear ended 31 December 2021
Guangyuan Technology LXML
RMB’000 RMB’000
Revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118257,555 2,522,934
Total expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118228,566 2,337,236
Profit for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111828,989 185,698
Total comprehensive income for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111828,989 123,844
Current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118331,166 2,609,974
Non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111893,723 2,080,832
Current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118133,296 572,667
Non-current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118661 1,622,407
Net cash flows from operating activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111821,073 343,364
Net cash flows from/(used in) investing activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(4,079) (192,776)
Net cash flows used in financing activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(15,412) (86,820)
Effect of foreign exchange rate changes, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (2,589)
Net increase/(decrease) in cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H11181,582 61,179
Y ear ended 31 December 2022
Guangyuan
Technology LXML GSR
RMB’000 RMB’000 RMB’000
Revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118306,510 2,998,740 1,790,576
Total expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118282,484 2,767,677 1,796,047
Profit for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111824,026 231,063 (5,471)
Total comprehensive income for the year /H1118/H1118/H1118/H1118/H1118/H111824,026 455,093 152,691
Current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118366,450 3,006,190 583,937
Non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111886,630 2,516,493 8,058,618
Current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118100,554 1,028,503 870,138
Non-current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111840,568 1,939,781 3,914,861
Net cash flows from operating activities /H1118/H1118/H1118/H1118/H1118/H111816,602 820,568 326,213
Net cash flows used in investing activities /H1118/H1118/H1118/H1118/H1118(10,234) (904,879) (441,816)
Net cash flows used in financing activities /H1118/H1118/H1118/H1118/H1118(7,234) 92,326 231,900
Effect of foreign exchange rate changes, net /H1118/H1118/H1118/H1118 – 10,203 79,269
Net increase/(decrease) in cash and cash
equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(866) 18,218 195,566
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-89 –


--- page 744 ---
Y ear ended 31 December 2023
Guangyuan
Technology LXML GSR
RMB’000 RMB’000 RMB’000
Revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118399,141 3,054,614 2,139,329
Total expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118377,232 2,768,062 2,126,959
Profit for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111821,909 286,552 12,370
Total comprehensive income for the year /H1118/H1118/H1118/H1118/H1118/H111821,909 332,302 77,183
Current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118421,789 2,979,605 692,240
Non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111879,540 2,399,421 8,034,857
Current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118127,007 802,841 1,001,405
Non-current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111840,455 1,689,484 3,790,954
Net cash flows from/(used in) operating
activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(40,953) 649,058 645,563
Net cash flows from/(used in) investing
activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,379 (123,993) (488,388)
Net cash flows from/(used in) financing
activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111832,254 (401,935) (106,262)
Effect of foreign exchange rate changes, net /H1118/H1118/H1118/H1118 – 2,828 9,567
Net increase in cash and cash equivalents /H1118/H1118/H1118/H1118/H11181,680 125,958 60,480
Nine months ended 30 September 2024
Guangyuan
Technology LXML GSR
RMB’000 RMB’000 RMB’000
Revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118191,216 2,327,466 2,097,116
Total expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118181,188 1,983,601 1,947,125
Profit for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,028 343,865 149,991
Total comprehensive income for the year /H1118/H1118/H1118/H1118/H1118/H111810,028 301,673 101,555
Current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118466,839 3,506,426 915,968
Non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111874,476 2,419,676 7,882,107
Current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118197,015 935,873 1,732,568
Non-current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118405 1,801,856 3,029,215
Net cash flows from/(used in) operating
activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(31,857) 586,044 772,760
Net cash flows used in investing activities /H1118/H1118/H1118/H1118/H1118 – (464,534) (372,747)
Net cash flows from/(used in) financing
activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111826,881 (106,777) (201,068)
Effect of foreign exchange rate changes, net /H1118/H1118/H1118/H1118 – (2,271) 7,188
Net increase/(decrease) in cash and cash
equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(4,976) 12,462 206,133
43. NOTES TO THE CONSOLIDATED STATEMENTS OF CASH FLOWS
(a) Major non-cash transactions
During the Revelant Periods, the Group had non-cash additions to the right-of-use assets and lease liabilities
of nil, RMB56,538,000 and RMB25,977,000 for the years ended 31 December 2021, 2022 and 2023, and nil
(unaudited) and RMB2,655,000 for the nine months ended 30 September 2023 and 2024, respectively, in respect of
lease arrangements.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-90 –


--- page 745 ---
(b) Changes in liabilities arising from financing activities
Short-term
loans
Financial
liabilities at
fair value
through profit
or loss
Long-term
loans Lease liabilities Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As at 1 January 2021 /H1118/H1118/H1118/H1118165,020 113,161 111,044 5,782 395,007
Changes from financing
cash flows /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(165,020) 300,756 (83,846) (1,553) 50,337
Cash paid for interest
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(3,477) – (6,312) – (9,789)
Interest expenses /H1118/H1118/H1118/H1118/H1118/H11183,477 – 393 170 4,040
Exchange realignment /H1118/H1118/H1118 – – 4,251 – 4,251
Changes on fair value /H1118/H1118/H1118 – (26,234) – – (26,234)
As at 31 December 2021 /H1118/H1118 – 387,683 25,530 4,399 417,612
As at 1 January 2022 /H1118/H1118/H1118/H1118 – 387,683 25,530 4,399 417,612
Changes from financing
cash flows /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118474,801 184,903 1,758,104 (33,696) 2,384,112
Cash paid for interest
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(23,982) – (99,574) – (123,556)
Interest expenses /H1118/H1118/H1118/H1118/H1118/H111828,223 – 99,574 10,211 138,008
Exchange realignment /H1118/H1118/H1118 9,367 – 63,917 17,393 90,677
Acquisition of a subsidiary
(note 50) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 207,137 207,137
New leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 56,538 56,538
Changes on fair value /H1118/H1118/H1118 – 47,664 – – 47,664
As at 31 December 2022 /H1118/H1118 488,409 620,250 1,847,551 261,982 3,218,192
As at 1 January 2023 /H1118/H1118/H1118/H1118488,409 620,250 1,847,551 261,982 3,218,192
Changes from financing
cash flows /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118366,881 179,285 (229,576) (58,102) 258,488
Cash paid for interest
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(25,897) – (105,432) – (131,329)
Interest expenses /H1118/H1118/H1118/H1118/H1118/H111822,498 – 137,123 12,340 171,961
Exchange realignment /H1118/H1118/H1118(1,882) – (9,377) 3,105 (8,154)
New leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 2,912 2,912
Acquisition of a subsidiary
(note 50) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 23,065 23,065
Changes on fair value /H1118/H1118/H1118 – 140,461 – – 140,461
As at 31 December 2023 /H1118/H1118 850,009 939,996 1,640,289 245,302 3,675,596
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-91 –


--- page 746 ---
Short-term
loans
Financial
liabilities at
fair value
through profit
or loss
Long-term
loans Lease liabilities Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited)
As at 1 January 2023 /H1118/H1118/H1118/H1118488,409 620,250 1,847,551 261,982 3,218,192
Changes from financing
cash flows /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118369,216 149,822 (280,334) (28,507) 210,197
Cash paid for interest
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(22,602) – (68,693) – (91,295)
Interest expenses /H1118/H1118/H1118/H1118/H1118/H111816,183 – 86,136 7,116 109,435
Exchange realignment /H1118/H1118/H1118 2,157 – 23,402 7,402 32,961
Changes on fair value /H1118/H1118/H1118 – 78,077 – – 78,077
As at 30 September 2023
(unaudited) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118853,363 848,149 1,608,062 247,993 3,557,567
Short-term
loans
Financial
liabilities at
fair value
through profit
or loss
Long-term
loans Lease liabilities Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As at 1 January 2024 /H1118/H1118/H1118/H1118850,009 939,996 1,640,289 245,302 3,675,596
Changes from financing
cash flows /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(24,999) (107,118) (312,587) (30,686) (475,390)
Cash paid for interest
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(41,341) – (57,923) – (99,264)
Interest expenses /H1118/H1118/H1118/H1118/H1118/H111841,011 – 65,859 8,283 115,153
Exchange realignment /H1118/H1118/H1118(1,950) – (12,246) (2,020) (16,216)
New leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 2,665 2,665
Changes on fair value /H1118/H1118/H1118 – 193,332 – – 193,332
As at 30 September 2024 /H1118 822,730 1,026,210 1,323,392 223,544 3,395,876
(c) Total cash outflow for leases
The total cash outflow for leases included in the statements of cash flows is as follows:
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Within operating activities /H1118 (3,115) (20,766) (15,969) (12,529) (8,818)
Within financing activities
(note) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,553) (33,696) (58,102) (28,507) (30,686)
(4,668) (54,462) (74,071) (41,036) (39,504)
Note: The cash outflow for leases in financing activities includes the principal portion of lease payments and
related interests.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-92 –


--- page 747 ---
44. PLEDGE OF ASSETS
Details of the Group’s assets pledged for the Group’s interest-bearing bank loans are included in notes 35 and
36 to the Historical Financial Information.
45. COMMITMENTS AND CONTINGENCIES
The Group had the following capital commitments at the end of each of the Relevant Periods:
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Contracted, but not provided for:
Property, plant and equipment /H1118/H1118/H1118 98,016 233,730 230,173 234,385
Investment commitment /H1118/H1118/H1118/H1118/H1118/H1118/H1118253,000 318,064 256,864 322,901
351,016 551,794 487,037 557,286
46. RELATED PARTY TRANSACTIONS
(a) The Group had the following related parties during the Relevant Periods:
Name of related parties Relationship between related parties and the Company
Li Jinyang* /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118the Single Largest Shareholder
Wang Jianhua** /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Chairman
Beijing Eagleleap Technology Co., Ltd.
(“Eagleleap”)*** /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Entity under common control of the Single Largest Shareholder
* The loans provided is unsecured and charged at interest rates at nil, 3.65%, 3.45%, 3.45% as at 31
December 2021, 2022, 2023 and 30 September 2024, respectively.
** The loans provided is unsecured and interest-free.
*** Purchases of the property management services were made according to the prices agreed by all parties.
(b) In addition to the transactions detailed elsewhere in the Historical Financial Information, the Group had the
following transactions with related parties during the Relevant Periods:
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Service rendering from a
subsidiary of the
Company’s controlling
shareholder
Eagleleap /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118189 338 731 377 164
189 338 731 377 164
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-93 –


--- page 748 ---
(c) Rental charge paid
Y ear ended 31 December 2021
Category of
leased assets
Rental
expenses of
short-term
leases and
low-value asset
leases with
simplified
treatment
Variable lease
payments not
included in the
measurement
of lease
liabilities
Rental
payments
Interest
expenses of
lease liabilities
Increase in
right-of-use
assets
Eagleleap /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Buildings 2,369 – 2,369 – –
Y ear ended 31 December 2022
Category of
leased assets
Rental
expenses of
short-term
leases and
low-value asset
leases with
simplified
treatment
Variable lease
payments not
included in the
measurement
of lease
liabilities
Rental
payments
Interest
expenses of
lease liabilities
Increase in
right-of-use
assets
Eagleleap /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Buildings 182 – 4,876 425 13,986
Y ear ended 31 December 2023
Category of
leased assets
Rental
expenses of
short-term
leases and
low-value asset
leases with
simplified
treatment
Variable lease
payments not
included in the
measurement
of lease
liabilities
Rental
payments
Interest
expenses of
lease liabilities
Increase in
right-of-use
assets
Eagleleap /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Buildings 170 – 4,469 236 –
Nine months ended 30 September 2023
Category of
leased assets
Rental
expenses of
short-term
leases and
low-value asset
leases with
simplified
treatment
Variable lease
payments not
included in the
measurement
of lease
liabilities
Rental
payments
Interest
expenses of
lease liabilities
Increase in
right-of-use
assets
Eagleleap /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Buildings 170 – 4,469 137 –
Nine months ended 30 September 2024
Category of
leased assets
Rental
expenses of
short-term
leases and
low-value asset
leases with
simplified
treatment
Variable lease
payments not
included in the
measurement
of lease
liabilities
Rental
payments
Interest
expenses of
lease liabilities
Increase in
right-of-use
assets
Eagleleap /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Buildings 52 – 2,197 83 –
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-94 –


--- page 749 ---
(d) New loans received from related parties (non-trade)
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Wang Jianhua /H1118/H1118/H1118/H1118/H1118/H1118/H1118620,000 463,000 – – –
Li Jinyang /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,074,240 – – –
620,000 1,537,240 – – –
(e) New loans repaid to related parties (non-trade)
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Wang Jianhua /H1118/H1118/H1118/H1118/H1118/H1118/H1118620,000 463,000 – – –
Li Jinyang /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 663,300 300,040 – 128,546
620,000 1,126,300 300,040 – 128,546
(f) Outstanding balances with related parties:
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Other payables and accruals
Eagleleap (trade) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–4 12 2 2
Li Jinyang (non-trade) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 410,940 128,525 –
– 410,981 128,547 2
Lease liabilities
Eagleleap (trade) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 9,535 4,469 2,271
– 9,535 4,469 2,271
(g) Compensation of key management personnel of the Group:
Y ear ended
31 December
2021
Y ear ended
31 December
2022
Y ear ended
31 December
2023
Nine months
ended
30 September
2023
Nine months
ended
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(unaudited)
Compensation for key
management personnel /H1118/H1118 36,036 29,326 31,028 15,898 14,931
36,036 29,326 31,028 15,898 14,931
Further details of directors’ emoluments are included in note 8 to the Historical Financial Information.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-95 –


--- page 750 ---
47. FINANCIAL INSTRUMENTS BY CATEGORY
The carrying amounts of each of the categories of financial instruments as at the end of each of the Relevant
Periods are as follows:
31 December 2021
Financial assets
Financial assets
at amortised cost
Financial assets
at fair value Total
RMB’000 RMB’000 RMB’000
Trade receivables from other sales /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825,260 – 25,260
Trade receivables from the comprehensive
recycling of resources business /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118311,447 – 311,447
Financial assets included in prepayments,
other receivables and other assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118116,856 – 116,856
Financial assets at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 11,237 11,237
Derivative financial instruments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 6,436 6,436
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,707,868 – 1,707,868
Restricted cash /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118116,881 – 116,881
Other non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118145,587 – 145,587
2,423,899 17,673 2,441,572
Financial liabilities
Financial liabilities
at amortised cost
Financial liabilities
at fair value Total
RMB’000 RMB’000 RMB’000
Trade and notes payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118440,401 – 440,401
Financial liabilities at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 387,683 387,683
Derivative financial liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,831 1,831
Financial liabilities included in other
payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111831,413 – 31,413
Current portion of long-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825,530 – 25,530
Current portion of other non-current liabilities /H1118/H1118 186,589 – 186,589
Other non-current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111872,693 – 72,693
756,626 389,514 1,146,140
31 December 2022
Financial assets
Financial assets
at amortised cost
Financial assets
at fair value Total
RMB’000 RMB’000 RMB’000
Trade receivables from other sales /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111829,637 – 29,637
Trade receivables from the comprehensive
recycling of resources business /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118339,237 – 339,237
Financial assets included in prepayments,
other receivables and other assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111896,112 – 96,112
Financial assets at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 48,131 48,131
Derivative financial instruments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 584 584
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,052,545 – 1,052,545
Restricted cash /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118232,560 – 232,560
Other non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111887,101 – 87,101
1,837,192 48,715 1,885,907
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-96 –


--- page 751 ---
Financial liabilities
Financial liabilities
at amortised cost
Financial liabilities
at fair value Total
RMB’000 RMB’000 RMB’000
Trade and notes payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118851,390 – 851,390
Financial liabilities at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 620,250 620,250
Financial liabilities included in other
payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118452,962 – 452,962
Short-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118488,409 – 488,409
Current portion of long-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118333,770 – 333,770
Current portion of other non-current liabilities /H1118/H1118 10,849 – 10,849
Long-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,513,781 – 1,513,781
Other non-current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111862,337 – 62,337
3,713,498 620,250 4,333,748
31 December 2023
Financial assets
Financial assets
at amortised cost
Financial assets
at fair value Total
RMB’000 RMB’000 RMB’000
Trade receivables from other sales /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118115,732 – 115,732
Trade receivables from the comprehensive
recycling of resources business /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118397,481 – 397,481
Financial assets included in prepayments,
other receivables and other assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118173,475 – 173,475
Financial assets at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 16,909 16,909
Derivative financial instruments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 13,470 13,470
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,274,635 – 1,274,635
Restricted cash /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118387,648 – 387,648
Other non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118105,840 – 105,840
2,454,811 30,379 2,485,190
Financial liabilities
Financial liabilities
at amortised cost
Financial liabilities
at fair value Total
RMB’000 RMB’000 RMB’000
Trade and notes payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118552,457 – 552,457
Financial liabilities at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 939,996 939,996
Financial liabilities included in other
payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118301,089 – 301,089
Short-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118850,009 – 850,009
Current portion of long-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118218,315 – 218,315
Current portion of other non-current liabilities /H1118/H1118 9,485 – 9,485
Long-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,421,974 – 1,421,974
Other non-current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111862,475 – 62,475
3,415,804 939,996 4,355,800
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-97 –


--- page 752 ---
30 September 2024
Financial assets
Financial assets
at amortised cost
Financial assets
at fair value Total
RMB’000 RMB’000 RMB’000
Trade receivables from other sales /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118163,455 – 163,455
Trade receivables from the comprehensive
recycling of resources business /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118443,286 – 443,286
Financial assets included in prepayments,
other receivables and other assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118520,824 – 520,824
Financial assets at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 13,204 13,204
Derivative financial instruments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 43,438 43,438
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,094,141 – 2,094,141
Restricted cash /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118303,616 – 303,616
Other non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118111,803 – 111,803
3,637,125 56,642 3,693,767
Financial liabilities
Financial liabilities
at amortised cost
Financial liabilities
at fair value Total
RMB’000 RMB’000 RMB’000
Trade and notes payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118636,817 – 636,817
Financial liabilities at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,026,210 1,026,210
Derivative financial liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 17,002 17,002
Financial liabilities included in other
payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118522,682 – 522,682
Short-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118822,730 – 822,730
Current portion of long-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118641,778 – 641,778
Current portion of other non-current liabilities /H1118/H1118 5,717 – 5,717
Long-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118681,614 – 681,614
Other non-current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111858,450 – 58,450
3,369,788 1,043,212 4,413,000
48. FAIR V ALUE AND FAIR V ALUE HIERARCHY OF FINANCIAL INSTRUMENTS
Management has assessed that the fair values of cash and cash equivalents, trade receivables from
comprehensive recycling of resources business, trade receivables from gold and commodities sales, financial assets
included in prepayments, other receivables and other assets, trade and notes payables, financial liabilities included
in other payables and accruals, and other non-current liabilities due within one year approximate to their carrying
amounts largely due to the short-term maturities of these instruments.
The fair values of financial assets included in other non-current assets, short-term and long-term loans, lease
liabilities and financial liabilities included in other non-current liabilities were determined by discounting the
expected future cash flows using market rates of return currently available for other financial instruments with similar
terms, credit risk and remaining maturities or incremental borrowing rate. The Group’s own non-performance risk for
short-term and long-term loans was assessed to be insignificant. The futures contracts and listed equity investments
is determined based on the settlement price of the gold futures contracts held in the Shanghai Futures Exchange on
the balance sheet date and quoted market prices. The outstanding gold lease financing market value is determined
based on the closing price of the gold lease products on the Shanghai Gold Exchange on the balance sheet date.
The Group’s finance department headed by the finance manager is responsible for determining the policies and
procedures for the fair value measurement of financial instruments. The finance manager reports directly to the chief
financial officer and the audit committee. At the end of each of the Relevant Periods, the finance department analyses
the movements in the values of financial instruments and determines the major inputs applied in the valuation. The
valuation is reviewed and approved by the chief financial officer. The valuation process and results are discussed with
the audit committee twice a year for interim and annual financial reporting.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-98 –


--- page 753 ---
Fair value hierarchy
The following tables illustrate the fair value measurement hierarchy of the Group’s financial instruments:
Assets measured at fair value:
As at 31 December 2021
Fair value measurement using
Quoted prices in
active markets
(Level 1)
Significant
observable inputs
(Level 2)
Significant
unobservable
inputs
(Level 3) Total
RMB’000 RMB’000 RMB’000 RMB’000
(I) Financial assets at fair value
through profit or loss
Including: Equity investment /H1118/H1118 11,237 – – 11,237
(II) Derivative financial assets
Including: Hedging instruments /H1118 6,436 – – 6,436
17,673 – – 17,673
As at 31 December 2022
Fair value measurement using
Quoted prices in
active markets
(Level 1)
Significant
observable inputs
(Level 2)
Significant
unobservable
inputs
(Level 3) Total
RMB’000 RMB’000 RMB’000 RMB’000
(I) Financial assets at fair value
through profit or loss
Including: Equity investment /H1118/H1118 48,131 – – 48,131
(II) Derivative financial assets
Including: Hedging instruments /H1118 584 – – 584
48,715 – – 48,715
As at 31 December 2023
Fair value measurement using
Quoted prices in
active markets
(Level 1)
Significant
observable inputs
(Level 2)
Significant
unobservable
inputs
(Level 3) Total
RMB’000 RMB’000 RMB’000 RMB’000
(I) Financial assets at fair value
through profit or loss
Including: Equity investment /H1118/H1118 16,909 – – 16,909
(II) Derivative financial assets
Including: Hedging instruments /H1118 13,470 – – 13,470
30,379 – – 30,379
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-99 –


--- page 754 ---
As at 30 September 2024
Fair value measurement using
Quoted prices in
active markets
(Level 1)
Significant
observable inputs
(Level 2)
Significant
unobservable
inputs
(Level 3) Total
RMB’000 RMB’000 RMB’000 RMB’000
(I) Financial assets at fair value
through profit or loss
Including: Equity investment /H1118/H1118 13,204 – – 13,204
(II) Derivative financial assets
Including: Hedging instruments /H1118 43,438 – – 43,438
56,642 – – 56,642
Liabilities measured at fair value:
As at 31 December 2021
Fair value measurement using
Quoted prices in
active markets
(Level 1)
Significant
observable inputs
(Level 2)
Significant
unobservable
inputs
(Level 3) Total
RMB’000 RMB’000 RMB’000 RMB’000
(I) Financial liabilities at fair value
through profit or loss
Including: Gold lease /H1118/H1118/H1118/H1118/H1118/H1118/H1118387,683 – – 387,683
(II) Derivative financial liabilities
Including: Hedging instruments /H1118 1,831 – – 1,831
389,514 – – 389,514
As at 31 December 2022
Fair value measurement using
Quoted prices in
active markets
(Level 1)
Significant
observable inputs
(Level 2)
Significant
unobservable
inputs
(Level 3) Total
RMB’000 RMB’000 RMB’000 RMB’000
Financial liabilities at fair value
through profit or loss
Including: Gold lease /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118620,250 – – 620,250
620,250 – – 620,250
As at 31 December 2023
Fair value measurement using
Quoted prices in
active markets
(Level 1)
Significant
observable inputs
(Level 2)
Significant
unobservable
inputs
(Level 3) Total
RMB’000 RMB’000 RMB’000 RMB’000
Financial liabilities at fair value
through profit or loss
Including: Gold lease /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118939,996 – – 939,996
939,996 – – 939,996
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-100 –


--- page 755 ---
As at 30 September 2024
Fair value measurement using
Quoted prices in
active markets
(Level 1)
Significant
observable inputs
(Level 2)
Significant
unobservable
inputs
(Level 3) Total
RMB’000 RMB’000 RMB’000 RMB’000
(I) Financial liabilities at fair value
through profit or loss
Including: Gold lease /H1118/H1118/H1118/H1118/H1118/H1118/H11181,026,210 – – 1,026,210
(II) Derivative financial liabilities
Including: Hedging instruments /H1118 17,002 – – 17,002
1,043,212 – – 1,043,212
During the Relevant Periods, there were no transfers between Level 1 and Level 2, or transfers into or out of
Level 3 for both financial assets and financial liabilities. The Group’s policy is to recognise transfers between levels
of the fair value hierarchy as at the end of each of the Relevant Periods in which they occur.
49. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Group is exposed to various risks in relation to financial instruments in its daily operations, mainly credit
risk, liquidity risk and market risk (including interest rate risk, exchange rate risk, and commodity price risk). The
Group’s major financial instruments include cash and cash equivalents, financial assets at fair value through profit
or loss, derivative financial assets, trade receivables, other non-current assets, short-term and long-term loans,
financial liabilities at fair value through profit or loss, trade and notes payables, other payables and accruals, etc. The
Group also enters into certain derivative transactions, including interest rate swaps, commodity future contracts and
forward exchange contracts. The purpose is to manage the interest rate risk, commodity price risk and currency risks
arising from the Group’s operations and its sources of finance. The Group manages the market risks of derivatives
based on the difference between the metal price in the market and the target metal price pre-determined by
management. Risks in connection with such financial instruments, and the risk management strategies adopted by the
Group to mitigate such risks are summarised as follows.
Interest rate risk
The Group’s exposure to the risk of changes in market interest rates relates primarily to the Group’s long-term
debt obligations with a floating interest rate.
The following table demonstrates the sensitivity to a reasonably possible change in interest rates, with all other
variables held constant, of the Group’s profit after tax (through the impact on floating rate borrowings) and the
Group’s equity.
Increase/(decrease)
in basis points
Increase/(decrease)
in profit after tax
Increase/(decrease)
in total
shareholders’
equity
RMB’000 RMB’000 RMB’000
2021
Loans denominated in USD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118100 (172) (172)
Loans denominated in USD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(100) 172 172
2022
Loans denominated in RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118100 (9,416) (9,416)
Loans denominated in RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(100) 9,416 9,416
Loans denominated in USD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118100 (5,052) (5,052)
Loans denominated in USD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(100) 5,052 5,052
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-101 –


--- page 756 ---
Increase/(decrease)
in basis points
Increase/(decrease)
in profit after tax
Increase/(decrease)
in total
shareholders’
equity
RMB’000 RMB’000 RMB’000
2023
Loans denominated in RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118100 (4,800) (4,800)
Loans denominated in RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(100) 4,800 4,800
Loans denominated in USD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118100 (4,707) (4,707)
Loans denominated in USD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(100) 4,707 4,707
Nine months ended 30 September 2024
Loans denominated in RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118100 (1,631) (1,631)
Loans denominated in RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(100) 1,631 1,631
Loans denominated in USD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118100 (3,101) (3,101)
Loans denominated in USD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(100) 3,101 3,101
Foreign currency risk
The Group has transactional exchange rate risk exposures mainly arising from sales or purchases by
subsidiaries in currencies other than the subsidiaries’ functional currencies. The Group has subsidiaries using USD
and RMB as their functional currencies. These subsidiaries have transactions in currencies other than their functional
currencies. In addition, the Group has exchange rate exposures arising from foreign currency borrowings. The Group
adopts an overall management on its foreign exchange business, and reduces its exchange rate exposures using
forward foreign exchange contracts based on the market trend as necessary.
The following tables present a sensitivity analysis of exchange rate risk, reflecting the impact that a reasonable
and probable change in the exchange rates of USD, GH
₵, GBP, CAD, AUD, LAK, THB, EUR and ZAR, with all other
variables remain constant, would have on net profit or loss and other comprehensive income, net of tax.
Increase/(decrease)
in exchange rate
Increase/(decrease)
in profit after tax
Increase/(decrease)
in total
shareholders’
equity
RMB’000 RMB’000 RMB’000
2021
If the RMB weakens against the USD /H1118/H1118/H1118/H1118/H1118/H1118/H11185% 42,140 42,140
If the RMB strengthens against the USD /H1118/H1118/H1118/H1118/H1118/H1118(5%) (42,140) (42,140)
If the USD weakens against the LAK /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185% 1,425 1,425
If the USD strengthens against the LAK /H1118/H1118/H1118/H1118/H1118/H1118(5%) (1,425) (1,425)
2022
If the RMB weakens against the USD /H1118/H1118/H1118/H1118/H1118/H1118/H11185% 7,692 7,692
If the RMB strengthens against the USD /H1118/H1118/H1118/H1118/H1118/H1118(5%) (7,692) (7,692)
If the USD weakens against the GH ₵ /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185% 377 377
If the USD strengthens against the GH ₵ /H1118/H1118/H1118/H1118/H1118/H1118(5%) (377) (377)
If the USD weakens against the LAK /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185% 100 100
If the USD strengthens against the LAK /H1118/H1118/H1118/H1118/H1118/H1118(5%) (100) (100)
2023
If the RMB weakens against the USD /H1118/H1118/H1118/H1118/H1118/H1118/H11185% 18,093 18,093
If the RMB strengthens against the USD /H1118/H1118/H1118/H1118/H1118/H1118(5%) (18,093) (18,093)
If the USD weakens against the GH ₵ /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185% 624 624
If the USD strengthens against the GH ₵ /H1118/H1118/H1118/H1118/H1118/H1118(5%) (624) (624)
If the USD weakens against the LAK /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185% (1,249) (1,249)
If the USD strengthens against the LAK /H1118/H1118/H1118/H1118/H1118/H1118(5%) 1,249 1,249
If the USD weakens against the EUR /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185% 1,295 1,295
If the USD strengthens against the EUR /H1118/H1118/H1118/H1118/H1118/H1118(5%) (1,295) (1,295)
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-102 –


--- page 757 ---
Increase/(decrease)
in exchange rate
Increase/(decrease)
in profit after tax
Increase/(decrease)
in total
shareholders’
equity
RMB’000 RMB’000 RMB’000
Nine months ended 30 September 2024
If the RMB weakens against the USD /H1118/H1118/H1118/H1118/H1118/H1118/H11185% 13,871 13,871
If the RMB strengthens against the USD /H1118/H1118/H1118/H1118/H1118/H1118(5%) (13,871) (13,871)
If the USD weakens against the GH ₵ /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185% 12,162 12,162
If the USD strengthens against the GH ₵ /H1118/H1118/H1118/H1118/H1118/H1118(5%) (12,162) (12,162)
If the USD weakens against the AUD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185% 3,447 3,447
If the USD strengthens against the AUD /H1118/H1118/H1118/H1118/H1118/H1118(5%) (3,447) (3,447)
If the USD weakens against the LAK /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185% 302 302
If the USD strengthens against the LAK /H1118/H1118/H1118/H1118/H1118/H1118(5%) (302) (302)
Price risk of equity instrument investments
Price risk of equity instrument investments refers to the risk that the fair value of equity securities was reduced
due to changes in the level of the stock index and the value of individual securities. As at 31 December 2021, 2022,
and 2023 and as at 30 September 2024, the Group was exposed to the price risk of individual equity instrument
investments due to the classification as equity instrument investments at fair value through profit or loss.
The listed equity instrument investment was listed on the Australian Stock Exchange and the Canadian
Securities Exchange, and was measured at quoted market price at balance sheet date.
The following tables demonstrate the sensitivity of the Group’s net profit and loss and other comprehensive
income net of tax to every 5% change in the fair value of equity instrument investments, under the assumption that
all other variables are held constant. Management considered that the percentage of 5% reasonably reflects the
reasonable range of possible change in fair value in the following year.
Equity instrument
investments
Net gains
and losses
Total shareholders’
equity
Book value Increase/ (decrease) Increase/ (decrease)
As at December 2021
Equity instrument investments
Australia – Equity instrument investments at
fair value through profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811,237 474/(474) 474/(474)
As at December 2022
Equity instrument investments
Australia – Equity instrument investments at
fair value through profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111847,959 1,930/(1,930) 1,930/(1,930)
Canada – Equity instrument investments at fair
value through profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118172 6/(6) 6/(6)
As at December 2023
Equity instrument investments
Australia – Equity instrument investments at
fair value through profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111816,734 695/(695) 695/(695)
Canada – Equity instrument investments at fair
value through profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118175 6/(6) 6/(6)
As at September 2024
Equity instrument investments
Australia – Equity instrument investments at
fair value through profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813,031 552/(552) 552/(552)
Canada – Equity instrument investments at fair
value through profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118173 6/(6) 6/(6)
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-103 –


--- page 758 ---
Credit risk
The Group only deals with approved and reputable third parties. According to the Group’s policy, all customers
who require credit transactions are subject to credit review. In addition, the Group continuously monitors the balance
of trade receivables to ensure that the Group is not exposed to significant bad debt risks.
Since counterparties of cash and bank balances are banks with good reputation and high credit ratings, credit
risk arising from these financial instruments is insignificant.
Other financial assets of the Group include receivables and some derivatives. The credit risk on these financial
assets arises from the default of counterparties, with a maximum exposure equal to the carrying amounts of these
instruments.
The Group only deals with approved and reputable third parties, so no need for collateral. Credit risk is
managed centrally based on customers/counterparties, geographic regions and industries. As at 31 December 2021,
2022 and 2023 and 30 September 2024, the Group had a specific concentration of credit risk. 41.70%, 46.27%
63.41%, and 52.30% of the Group’s trade receivables from gold and commodities sales were from the largest
customers in terms of trade receivable balances. 92.74%, 85.11%, 98.38% and 99.98% of the Group’s trade
receivables from gold and commodities sales were from the top five customers in terms of trade receivable balances.
The balance of trade receivables of the Group did not hold any collateral or other credit enhancements.
As at 31 December 2021, 2022 and 2023 and 30 September 2024, trade receivables from the comprehensive
recycling of resources business balances were government dismantling tariffs provided by the PRC government for
the treatment of certain waste electric and electronic products. In the opinion of the directors of the Company, the
expected credit losses are low because the trade receivable balances are due from the Ministry of Ecology and
Environment of the PRC which is with high reputation and no actual loss was incurred in history.
Determination of significant increase in credit risk
At each balance sheet date, the Group assesses whether the credit risk on the relevant financial instruments has
increased significantly since initial recognition. When determining whether the credit risk has increased significantly
since initial recognition, the Group considers reasonable and supportable information that is relevant and available
without undue cost or effort, including qualitative and quantitative analysis based on historical data of the Group,
external credit risk ratings and forward-looking information. The Group, based on individual financial instruments
or financial instrument groupings with similar credit risk characteristics, determines changes in the risk of default in
the estimated lifetime of financial instruments by comparing the risk of default of financial instruments at the balance
sheet date with that at the initial recognition.
The credit quality of the financial assets is considered to be “normal” when they are not past due and there
is no information indicating that the financial assets had a significant increase in credit risk since initial recognition.
Otherwise, the credit quality of the financial assets is considered to be “doubtful”.
Definition of credit-impaired financial assets
In order to determine whether credit impairment occurs, the defined criteria adopted by the Group are
consistent with the internal credit risk management objectives for relevant financial instruments, both of which
incorporate quantitative and qualitative indicators. When assessing whether a debtor has suffered a credit impairment,
the Group usually considers the following factors:
(1) significant financial difficulty of the issuer or the debtor;
(2) breach of contract by the debtor, such as default or overdue payment in interest or principal repayment;
(3) a concession granted by the creditor to the debtor due to economic or contractual considerations related
to the debtor’s financial difficulty, which will not be granted under any other circumstances;
(4) possible bankruptcy or other financial reorganization of the debtor;
(5) disappearance of an active market for the financial asset due to financial difficulty of the issuer or the
debtor;
(6) financial assets purchased or sourced at large discounts indicating credit losses have occurred.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-104 –


--- page 759 ---
Financial assets may be credit-impaired due to the joint effects of multiple events rather than separately
identifiable events.
Liquidity risk
The Group monitors its risk to a shortage of funds using a recurring liquidity planning tool. This tool considers
both the maturity of its financial instruments and financial assets (e.g., trade receivables) and projected cash flows
from operations.
The Group’s objective is to maintain a balance between continuity of funding and flexibility through the use
of loans and bank borrowings.
The maturity profile of the Group’s financial liabilities as at the end of each of the Relevant Periods, based
on the contractual undiscounted payments, is as follows:
As at 31 December 2021
Within 1 year 1 to 2 years 2 to 5 years Over 5 years Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Financial liabilities at fair value
through profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118387,68 3––– 387,683
Derivative financial liabilities /H1118/H1118/H1118/H11181,83 1––– 1,831
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,553 1,553 1,553 – 4,659
Current portion of long-term loans /H1118 26,41 7––– 26,417
Trade and notes payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118440,40 1––– 440,401
Financial liabilities included in
other payables and accruals /H1118/H1118/H1118/H111831,41 3––– 31,413
Other non-current liabilities /H1118/H1118/H1118/H1118/H1118188,006 14,440 27,799 51,516 281,761
1,077,304 15,993 29,352 51,516 1,174,165
As at 31 December 2022
Within 1 year 1 to 2 years 2 to 5 years Over 5 years Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Short-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118498,89 7––– 498,897
Financial liabilities at fair value
through profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118620,25 0––– 620,250
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111842,775 42,382 103,884 131,255 320,296
Long-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118414,466 371,090 1,266,114 – 2,051,670
Trade and notes payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118851,39 0––– 851,390
Financial liabilities included in
other payables and accruals /H1118/H1118/H1118/H1118452,96 2––– 452,962
Other non-current liabilities /H1118/H1118/H1118/H1118/H111814,440 14,920 19,319 45,077 93,756
2,895,180 428,392 1,389,317 176,332 4,889,221
As at 31 December 2023
Within 1 year 1 to 2 years 2 to 5 years Over 5 years Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Short-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118866,06 4––– 866,064
Financial liabilities at fair value
through profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118939,99 6––– 939,996
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111848,342 39,917 105,359 101,791 295,409
Long-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118287,943 1,041,525 446,913 – 1,776,381
Trade and notes payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118552,45 7––– 552,457
Financial liabilities included in
other payables and accruals /H1118/H1118/H1118/H1118304,91 5––– 304,915
Other non-current liabilities /H1118/H1118/H1118/H1118/H111810,510 8,790 26,368 45,687 91,355
3,010,227 1,090,232 578,640 147,478 4,826,577
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-105 –


--- page 760 ---
As at 30 September 2024
Within 1 year 1 to 2 years 2 to 5 years Over 5 years Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Short-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118839,86 6––– 839,866
Financial liabilities at fair value
through profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,026,210 – – – 1,026,210
Derivative financial liabilities /H1118/H1118/H1118/H111817,00 2––– 17,002
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111847,275 43,605 108,608 74,426 273,914
Long-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118709,816 421,856 298,722 – 1,430,394
Trade and notes payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118636,81 7––– 636,817
Financial liabilities included in
other payables and accruals /H1118/H1118/H1118/H1118522,68 2––– 522,682
Other non-current liabilities /H1118/H1118/H1118/H1118/H11188,790 8,790 26,368 36,899 80,847
3,808,458 474,251 433,698 111,325 4,827,732
Capital management
The primary objective of the Group’s capital management is to ensure that it maintains strong credit rating and
healthy capital ratios in order to support its business and maximise shareholders’ value.
The Group regards total equity as its capital and manages its capital structure and makes adjustments to it, in
light of changes in economic conditions. To maintain or adjust the capital structure, the Group may adjust the
dividend payment to shareholders, return capital to shareholders or issue new shares. No changes were made in the
objectives, policies and processes during the Relevant Periods.
During the Relevant Periods, the Group’s strategy was to maintain the gearing ratio at a healthy level in order
to monitor capital. The principal strategies adopted by the Group include, but are not limited to, reviewing future cash
flow requirements and the ability to meet debt repayment schedules when they fall due, maintaining a reasonable
level of available banking facilities and adjusting investment plans and financing plans, if necessary, to ensure that
the Group has a reasonable level of capital to support its business. Gearing ratio is total liabilities divided by total
assets.
The gearing ratios at the end of each of the Relevant Periods were as follows:
31 December
2021
31 December
2022
31 December
2023
30 September
2024
RMB’000 RMB’000 RMB’000 RMB’000
Total assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,053,606 17,544,294 18,717,793 19,895,168
Total liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,052,575 10,135,991 10,175,585 10,095,270
Gearing ratio /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111838% 58% 54% 51%
50. ACQUISITIONS
(a) Acquisitions of Golden Star Resources
On 31 October 2021, Chijin HK entered into an agreement to acquire 62% of all issued and outstanding
common shares of GSR at a price of US$3.91 per share, for a total consideration of approximately USD291 million.
On 28 January 2022, the acquisition was completed.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-106 –


--- page 761 ---
The fair values of the identifiable assets and liabilities of GSR as at the date of acquisition were as follows:
Notes
Fair value recognised
on acquisition
RMB’000
Property, plant and equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111817 1,904,982
Right-of-use assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818 197,200
Other intangible assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819 5,248,534
Deferred tax assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111822 66,828
Other non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814,759
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111870,007
Financial assets at fair value through profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118158
Trade receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,500
Prepayments, deposits and other receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111892,390
Inventories /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118195,913
Provisions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111837 (108,800)
Contract liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111833 (640,754)
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818 (207,137)
Deferred tax liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111822 (2,226,163)
Trade and notes payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(172,763)
Other payables and accrued charges /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(903,498)
Tax payable /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(10,588)
Total identifiable net assets at fair value /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,527,568
Non-controlling interests /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,666,393)
Net assets acquired /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,861,175
Gain on recognition of negative goodwill /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(6,371)
Satisfied by cash /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,854,804
An analysis of the cash flows in respect of the acquisition of a subsidiary is as follows:
2022
RMB’000
Cash consideration /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,854,804)
Cash and bank balances acquired /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111870,007
Total net cash outflow /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,784,797)
Since the acquisition, GSR contributed RMB1,790,576,000 to the Group’s revenue and a loss of
RMB5,471,000 to the Group’s consolidated profit for the year ended 31 December 2022.
Had the combination taken place at the beginning of the year, the revenue from continuing operations of the
Group and the profit of the Group for the year would have been RMB6,378,263,000 and RMB140,457,000,
respectively.
(b) Acquisition of Xinhenghe Mining
On 30 December 2022, the Group entered into an Equity Transfer Agreement with Liu Xin, Li Y uanyuan, Wang
Zhonghua, Y unnan Y uanhao Mining Co., Ltd. and Kunming Xinhenghe Mining Co., Ltd. (“Xinhenghe Mining”) to
subscribe for a 51% equity interest in Xinhenghe Mining by way of cash at a subscription price of RMB61,200,000.
The transaction was completed on 9 January 2023 and the Group holds a 51% equity interest in Xinhenghe Mining
upon the completion of the transaction. The management of the Company believes that Xinhenghe Mining and its
subsidiaries do not constitute a business, and the acquisition is treated as an asset acquisition for accounting purposes.
As of 30 September 2024, there was an outstanding amount of RMB40,800,000 for the acquisition that has not been
paid, which will be paid after an exploration right be transferred into mining right.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-107 –


--- page 762 ---
51. NOTES TO THE STATEMENTS OF FINANCIAL POSITION OF THE COMPANY
A summary of the Company’s reserves is as follows:
Share premium
Share incentive
reserve* Reserve fund*
Retained
profits* Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
At 1 January 2021 /H1118/H1118/H1118/H1118/H1118/H11182,048,631 – 66,835 449,757 2,565,223
Total comprehensive
income for the year /H1118/H1118/H1118 – – – 326,109 326,109
Transfer from retained
profits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 32,610 (32,610) –
At 31 December 2021 and
1 January 2022 /H1118/H1118/H1118/H1118/H1118/H11182,048,631 – 99,445 743,256 2,891,332
Total comprehensive
income for the year /H1118/H1118/H1118 – – – 506,977 506,977
Transfer from retained
profits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 50,698 (50,698) –
At 31 December 2022 and
1 January 2023 /H1118/H1118/H1118/H1118/H1118/H11182,048,631 – 150,143 1,199,535 3,398,309
Total comprehensive
income for the year /H1118/H1118/H1118 – – – 716,002 716,002
Exercise /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 300,910 – – 300,910
Transfer from retained
profits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 71,600 (71,600) –
At 31 December 2023 /H1118/H1118/H11182,048,631 300,910 221,743 1,843,937 4,415,221
Share
premium*
Share incentive
reserve* Reserve fund*
Retained
profits* Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
At 31 December 2022 and
1 January 2023 /H1118/H1118/H1118/H1118/H1118/H11182,048,631 – 150,143 1,199,535 3,398,309
Profit for the period
(Unaudited) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 140,195 140,195
Total comprehensive
income for the period
(Unaudited) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 140,195 140,195
At 30 September 2023
(Unaudited) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,048,631 – 150,143 1,339,730 3,538,504
Share
premium*
Share incentive
reserve* Reserve fund*
Retained
profits* Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
At 31 December 2023 and
1 January 2024 /H1118/H1118/H1118/H1118/H1118/H11182,048,631 300,910 221,743 1,843,937 4,415,221
Profit for the period /H1118/H1118/H1118/H1118/H1118– – – (4,085) (4,085)
Total comprehensive
income for the period /H1118/H1118 – – – (4,085) (4,085)
Exercise of share incentive
plan /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (300,787) – – (300,787)
Distribution of dividends /H1118/H1118 – – – (82,436) (82,436)
At 30 September 2024 /H1118/H1118/H11182,048,631 123 221,743 1,757,416 4,027,913
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-108 –


--- page 763 ---
52. EVENTS AFTER THE RELEV ANT PERIODS
(1) On March 4, 2024, China Investment (Property) Limited (“China Investment”) (as seller, and an
Independent Third Party), Chixia Laos (as purchaser) and Chijin Xiawu (as guarantor) entered into an
equity transfer agreement, pursuant to which Chixia Laos shall acquire from China Investment 90%
equity interest in China Investment Mining (Laos) Sole Co., Ltd (“the target company”), which was
wholly owned by China Investment, at a total consideration of approximately USD19.0 million,
including an equity acquisition amount of USD6.3 million and a repayment to the debt of the target
company amounting to USD12.7 million. As at 30 September 2024, the Group’s prepayment for equity
acquisition is RMB66,844,000. Up to the date of this report, the Group has obtained the approval from
the National Development and Reform Commission of the PRC, and the parties to the transactions were
proceeding with the fulfilment of the other conditions of the transaction including changes of the
authorized representative of the target company.
(2) Upon resolutions at the general meeting of the Company on 15 January 2025, a share incentive plan (the
“SIP III”), namely “Phase III Employee Stock Ownership Plan”, for the purpose of providing incentives
and rewards to eligible participants who contribute to the success of the Group’s operations was
approved. The SIP III has been effective in February 2025 and, unless otherwise cancelled or amended,
will remain in force for 24 months from that date.
All of the shares that will be granted to the participants shall be subject to a performance-based
condition, which would be satisfied that the gold production volume of Company in 2025 increases by
more than 5% (inclusive) over the same period of last year. Up to the date of this report, 15,182,600
shares of SIP III have been granted to the participants.
53. SUBSEQUENT FINANCIAL STATEMENTS
No audited financial statements have been prepared by the Company, the Group or any of its subsidiaries in
respect of any period subsequent to 30 September 2024.
APPENDIX IA ACCOUNTANTS’ REPORT
– IA-109 –


--- page 764 ---
The following is the text of a report received from the independent reporting
accountants, Ernst & Young, Certified Public Accountants, Hong Kong, prepared for the
purpose of incorporation in this prospectus.
⭰㰟㛪姯⸒Ṳ⋀㈧
榀㸖毩歁㵳勘䙮怺979噆
⤑⏋✱ᷧ⺎27㧺
Tel 曢婘: +852 2846 9888
Fax ₚ䜆: +852 2868 4432
ey.com
Ernst & Young
27/F, One Taikoo Place
979 King’s Road
Quarry Bay, Hon
g Kong
ACCOUNTANTS’ REPORT ON HISTORICAL FINANCIAL INFORMATION OF
GOLDEN STAR RESOURCES LTD. TO THE DIRECTORS OF CHIFENG JILONG
GOLD MINING CO., LTD AND CITIC SECURITIES (HONG KONG) LTD.
Introduction
We report on the historical financial information of Golden Star Resources Ltd. (the
“Company”) and its subsidiaries (together, the “Group”) set out on pages IB-4 to IB-53, which
comprises the consolidated statements of profit or loss, the consolidated statements of
comprehensive income, the consolidated statements of changes in equity and the consolidated
statements of cash flows of the Group for the year ended 31 December 2021 and the one month
ended 31 January 2022 (the “Relevant Periods”), and the consolidated statements of financial
position of the Group and the statements of financial position of the Company as at 31
December 2021 and 31 January 2022 and material accounting policy information and other
explanatory information (together, the “Historical Financial Information”). The Historical
Financial Information set out on pages IB-4 to IB-53 forms an integral part of this report, which
has been prepared for inclusion in the prospectus of Chifeng Jilong Gold Mining Co., Ltd.
dated 28 February 2025 (the “Prospectus”) in connection with the initial listing of the shares
of Chifeng Jilong Gold Mining Co., Ltd. on the Main Board of The Stock Exchange of Hong
Kong Limited (the “Stock Exchange”).
Directors’ responsibility for the Historical Financial Information
The directors of the Company are responsible for the preparation of the Historical
Financial Information that gives a true and fair view in accordance with the basis of preparation
set out in Note 2 to the Historical Financial Information, and for such internal control as the
directors determine is necessary to enable the preparation of the Historical Financial
Information that is free from material misstatement, whether due to fraud or error.
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-1 –


--- page 765 ---
Reporting accountants’ responsibility
Our responsibility is to express an opinion on the Historical Financial Information and to
report our opinion to you. We conducted our work in accordance with Hong Kong Standard on
Investment Circular Reporting Engagements 200 Accountants’ Reports on Historical Financial
Information in Investment Circulars issued by the Hong Kong Institute of Certified Public
Accountants (“HKICPA”). This standard requires that we comply with ethical standards and
plan and perform our work to obtain reasonable assurance about whether the Historical
Financial Information is free from material misstatement.
Our work involved performing procedures to obtain evidence about the amounts and
disclosures in the Historical Financial Information. The procedures selected depend on the
reporting accountants’ judgement, including the assessment of risks of material misstatement
of the Historical Financial Information, whether due to fraud or error. In making those risk
assessments, the reporting accountants consider internal control relevant to the entity’s
preparation of the Historical Financial Information that gives a true and fair view in accordance
with the basis of preparation set out in Note 2 to the Historical Financial Information, in order
to design procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the entity’s internal control. Our work also
included evaluating the appropriateness of accounting policies used and the reasonableness of
accounting estimates made by the directors, as well as evaluating the overall presentation of
the Historical Financial Information.
We believe that the evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.
Opinion
In our opinion, the Historical Financial Information gives, for the purposes of the
accountants’ report, a true and fair view of the financial position of the Group and the Company
as at 31 December 2021 and 31 January 2022 and of the financial performance and cash flows
of the Group for each of the Relevant Periods in accordance with the basis of preparation set
out in Note 2 to the Historical Financial Information.
Review of interim comparative financial information
We have reviewed the interim comparative financial information of the Group which
comprises the consolidated statement of profit or loss, the consolidated statement of
comprehensive income, the consolidated statement of changes in equity and the consolidated
statement of cash flows for the one month ended 31 January 2021 and other explanatory
information (the “Interim Comparative Financial Information”). The directors of the Company
are responsible for the preparation and presentation of the Interim Comparative Financial
Information in accordance with the basis of preparation set out in Note 2 to the Historical
Financial Information. Our responsibility is to express a conclusion on the Interim
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-2 –


--- page 766 ---
Comparative Financial Information based on our review. We conducted our review in
accordance with International Standard on Review Engagements 2410 Review of Interim
Financial Information Performed by the Independent Auditor of the Entity issued by the
International Auditing and Assurance Standards Board (“IAASB”). A review consists of
making inquiries, primarily of persons responsible for financial and accounting matters, and
applying analytical and other review procedures. A review is substantially less in scope than
an audit conducted in accordance with International Standards on Auditing and consequently
does not enable us to obtain assurance that we would become aware of all significant matters
that might be identified in an audit. Accordingly, we do not express an audit opinion. Based on
our review, nothing has come to our attention that causes us to believe that the Interim
Comparative Financial Information, for the purposes of the accountants’ report, is not prepared,
in all material respects, in accordance with the basis of preparation set out in Note 2 to the
Historical Financial Information.
Report on matters under the Rules Governing the Listing of Securities on the Stock
Exchange and the Companies (Winding Up and Miscellaneous Provisions) Ordinance
Adjustments
In preparing the Historical Financial Information, no adjustments to the Underlying
Financial Statements as defined on page IB-4 have been made.
Dividends
We refer to Note 15 to the Historical Financial Information which states that no dividends
have been paid by the Company in respect of the Relevant Periods.
Ernst & Y oung
Certified Public Accountants
Hong Kong
28 February 2025
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-3 –


--- page 767 ---
I. HISTORICAL FINANCIAL INFORMATION
Preparation of Historical Financial Information
Set out below is the Historical Financial Information which forms an integral part of this
accountants’ report.
The financial statements of the Group for the Relevant Periods, on which the Historical
Financial Information is based, were audited by Ernst & Y oung in accordance with
International Standards on Auditing issued by the IAASB (the “Underlying Financial
Statements”).
The Historical Financial Information is presented in Renminbi (“RMB”) and all values
are rounded to the nearest thousand (RMB’000) except when otherwise indicated.
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-4 –


--- page 768 ---
CONSOLIDATED STATEMENTS OF PROFIT OR LOSS
Notes
Y ear ended
31 December
2021
One month
ended
31 January
2021
One month
ended
31 January
2022
RMB’000 RMB’000 RMB’000
(unaudited)
Revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187 1,671,379 120,733 111,476
Cost of sales /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(877,076) (65,921) (71,197)
Gross profit /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118794,303 54,812 40,279
Other income and gains /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810 22,312 9,519 95
Administrative expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(629,067) (19,282) (430,078)
Other expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811 (4,412) (829) (15,353)
Finance costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812 (64,419) (7,954) (5,520)
PROFIT/(LOSS) BEFORE TAX /H1118/H1118/H1118/H1118/H111813 118,717 36,266 (410,577)
Income tax expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814 (224,257) (18,475) 57,154
(LOSS)/PROFIT FOR THE
YEAR/PERIOD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(105,540) 17,791 (353,423)
Attributable to:
Owners of the parent /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(144,904) 14,464 (333,408)
Non-controlling interests /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111839,364 3,327 (20,015)
(105,540) 17,791 (353,423)
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-5 –


--- page 769 ---
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Y ear ended
31 December
2021
One month
ended
31 January
2021
One month
ended
31 January
2022
RMB’000 RMB’000 RMB’000
(unaudited)
(LOSS)/PROFIT FOR THE YEAR/PERIOD /H1118/H1118(105,540) 17,791 (353,423)
Other comprehensive income/(loss) that may
not be reclassified to profit or loss in
subsequent periods, net of tax:
Exchange differences on translation of
foreign operations (note) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(73,147) (74,912) 7,503
Other comprehensive income that may be
reclassified to profit or loss in subsequent
periods, net of tax:
Exchange differences on translation of
foreign operations (note) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(5,682) (1,184) 1,520
OTHER COMPREHENSIVE(LOSS)/INCOME
FOR THE YEAR/PERIOD, NET OF TAX /H1118/H1118 (78,829) (76,096) 9,023
TOTAL COMPREHENSIVE LOSS FOR THE
YEAR/PERIOD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(184,369) (58,305) (344,400)
Attributable to:
Owners of the parent /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(215,850) (54,022) (364,469)
Non-controlling interests /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111831,481 (4,283) 20,069
(184,369) (58,305) (344,400)
Note: The other comprehensive income arising from the translation of the foreign currency financial statements of
the parent company may not be reclassified and included in the profit or loss in subsequent periods. However,
the other comprehensive income arising from the translation of the foreign currency financial statements of
subsidiaries may be reclassified and included in the profit or loss in subsequent periods.
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-6 –


--- page 770 ---
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
Notes
31 December
2021
31 January
2022
RMB’000 RMB’000
NON-CURRENT ASSETS
Property, plant and equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111817 1,441,764 1,456,297
Right-of-use assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818(a) 193,934 192,027
Other intangible assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819 28,781 28,553
Deferred tax assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820 – 66,828
Other non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111821 14,762 14,759
TOTAL NON-CURRENT ASSETS /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,679,241 1,758,464
CURRENT ASSETS
Inventories /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111822 190,444 195,531
Trade receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111823 1,589 6,500
Prepayments, other receivables and other assets /H1118 24 87,696 92,390
Financial assets at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825 158 158
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111826 224,335 70,007
TOTAL CURRENT ASSETS /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118504,222 364,586
TOTAL ASSETS /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,183,463 2,123,050
CURRENT LIABILITIES /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Trade and notes payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111828 146,316 172,763
Contract liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111829 50,619 50,610
Other payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111830 117,991 903,498
Income tax payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,585 10,587
Current portion of long-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111831 4,798 –
Current portion of lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818(b) 20,361 20,291
Current portion of derivative
financial liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111827 188 –
Current portion of provisions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111832 6,797 6,796
TOTAL CURRENT LIABILITIES /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118352,655 1,164,545
NET CURRENT ASSETS/(LIABILITIES) /H1118/H1118/H1118/H1118/H1118/H1118/H1118151,567 (799,959)
TOTAL ASSETS LESS CURRENT LIABILITIES /H1118 1,830,808 958,505
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-7 –


--- page 771 ---
Notes
31 December
2021
31 January
2022
RMB’000 RMB’000
NON-CURRENT LIABILITIES
Long-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111831 529,656 –
Derivative financial liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111827 11,153 –
Contract liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111829 591,866 590,143
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818(b) 188,832 186,845
Deferred tax liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820 236,487 239,044
Provisions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111832 102,348 102,004
TOTAL NON-CURRENT LIABILITIES /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,660,342 1,118,036
NET ASSETS /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118170,466 (159,531)
EQUITY
Equity attributable to owners of the parent
Share capital /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111833 6,906,459 6,906,459
Reserves /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(6,901,831) (7,251,897)
4,628 (345,438)
Non-controlling interests /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118165,838 185,907
TOTAL EQUITY /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118170,466 (159,531)
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-8 –


--- page 772 ---
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
Y ear ended 31 December 2021
Attributable to owners of the parent
Share
capital
Share
premium*
Exchange
fluctuation
reserve*
Retained
profits* Total
Non-
controlling
interests
Total
equity
(note 33)
At 1 January 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,810,170 308,309 (805,571) (6,204,657) 108,251 134,357 242,608
(Loss)/Profit for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – (144,904) (144,904) 39,364 (105,540)
Exchange differences on translation of
foreign operations /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (70,946) – (70,946) (7,883) (78,829)
Total comprehensive (Loss)/income
for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (70,946) (144,904) (215,850) 31,481 (184,369)
Common stock invested by
shareholders /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111889,35 6––– 89,356 – 89,356
The amount of share-based payment
capitalized into shareholder’s
equity /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,933 15,938 – – 22,871 – 22,871
At 31 December 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,906,459 324,247 (876,517) (6,349,561) 4,628 165,838 170,466
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-9 –


--- page 773 ---
One month ended 31 January 2021 (unaudited)
Attributable to owners of the parent
Share
capital
Share
premium*
Exchange
fluctuation
reserve*
Retained
profits* Total
Non-
controlling
interests
Total
equity
(note 33)
At 1 January 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,810,170 308,309 (805,571) (6,204,657) 108,251 134,357 242,608
Profit for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 14,464 14,464 3,327 17,791
Exchange differences on translation of
foreign operations /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (68,486) – (68,486) (7,610) (76,096)
Total comprehensive (Loss)/income
for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (68,486) 14,464 (54,022) (4,283) (58,305)
The amount of share-based payment
capitalized into shareholder’s
equity /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,920 – – 1,920 – 1,920
At 31 January 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,810,170 310,229 (874,057) (6,190,193) 56,149 130,074 186,223
One month ended 31 January 2022
Attributable to owners of the parent
Share
capital
Share
premium*
Exchange
fluctuation
reserve*
Retained
profits* Total
Non-
controlling
interests
Total
equity
(note 33)
At 1 January 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,906,459 324,247 (876,517) (6,349,561) 4,628 165,838 170,466
Loss for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – (333,408) (333,408) (20,015) (353,423)
Exchange differences on translation of
foreign operations /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (31,061) – (31,061) 40,084 9,023
Total comprehensive income/(Loss)
for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (31,061) (333,408) (364,469) 20,069 (344,400)
The amount of share-based payment
capitalized into shareholder’s
equity /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 14,403 – – 14,403 – 14,403
At 31 January 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,906,459 338,650 (907,578) (6,682,969) (345,438) 185,907 (159,531)
* These reserve accounts comprise the consolidated reserves in the consolidated statements of financial positions
as at 31 December 2021 and 31 January 2022.
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-10 –


--- page 774 ---
CONSOLIDATED STATEMENTS OF CASH FLOWS
Notes
Y ear ended
31 December
2021
One month
ended 31
January 2021
One month
ended 31
January 2022
RMB’000 RMB’000 RMB’000
(unaudited)
CASH FLOWS FROM OPERA TING
ACTIVITIES
Profit/(loss) before tax: /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118118,717 36,266 (410,577)
Adjustments for:
Depreciation and amortization /H1118/H1118/H1118/H1118/H111813 200,286 17,857 12,899
Fair value changes of financial
assets and liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(20,946) (9,239) –
Finance costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111864,419 7,954 5,520
Foreign exchange losses, net /H1118/H1118/H1118/H1118/H1118/H11183,777 819 1,534
Share based compensation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815,938 1,920 14,403
Decrease/(increase) in inventories /H1118/H1118/H1118/H1118 4,709 (6,273) (5,106)
Decrease/(increase) in trade
receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(450) (1,127) (4,899)
Decrease/(increase) in prepayments,
other receivables and other assets /H1118/H1118 109,433 (74,086) 245
Increase/(decrease) in trade and
notes payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111816,980 (2,805) 26,407
Increase in other payables and
accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111846,390 5,059 247,933
Cash generated from/(used in)
operations /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118559,253 (23,655) (111,641)
Income tax paid /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(263,359) (85,323) –
Net cash flows from/(used in)
operating activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118295,894 (108,978) (111,641)
Net cash flows from operating
activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118295,894 (108,978) (111,641)
CASH FLOWS FROM INVESTING
ACTIVITIES
Cash paid for margin of fair value
hedging /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (23,617)
Purchases of property, plant and
equipment, intangible assets and
other non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(339,994) (18,686) (40,997)
Net cash flows used in
investing activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(339,994) (18,686) (64,614)
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-11 –


--- page 775 ---
Notes
Y ear ended
31 December
2021
One month
ended 31
January 2021
One month
ended 31
January 2022
RMB’000 RMB’000 RMB’000
(unaudited)
CASH FLOWS FROM FINANCING
ACTIVITIES
Cash received from investors /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111889,356 – –
New bank borrowings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118188,610 – –
Cash received from Chijin HK /H1118/H1118/H1118/H1118/H1118/H1118 – – 598,185
Repayment of bank borrowings /H1118/H1118/H1118/H1118/H1118/H1118(332,240) – (529,646)
Cash paid for distribution of dividends
or profit and interest expenses /H1118/H1118/H1118/H1118/H1118 (42,580) – (4,782)
Non-cash losses on extinguishment of
Macquiarie RCF /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (38,598)
Repayment of lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118(24,124) (2,435) (2,814)
Net cash flows (used in)/from
financing activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(120,978) (2,435) 22,345
DECREASE IN CASH AND CASH
EQUIV ALENTS /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(165,078) (130,099) (153,910)
Cash and cash equivalents at
beginning of year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118396,776 396,776 224,335
Effect of foreign exchange rate
changes, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(7,363) (3,166) (418)
CASH AND CASH EQUIV ALENTS
A T END OF YEAR/PERIOD /H1118/H1118/H1118/H1118/H1118/H1118224,335 263,511 70,007
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-12 –


--- page 776 ---
STATEMENTS OF FINANCIAL POSITION
Notes
31 December
2021
31 January
2022
RMB’000 RMB’000
NON-CURRENT ASSETS /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Other intangible assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111885 85
Investments in subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111841 1,387,935 2,682,852
TOTAL NON-CURRENT ASSETS /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,388,020 2,682,937
CURRENT ASSETS /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Prepayments, other receivable /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111824 2,281,758 361,787
Financial assets at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118158 158
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111826 124,813 16,146
TOTAL CURRENT ASSETS /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,406,729 378,091
TOTAL ASSETS /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,794,749 3,061,028
CURRENT LIABILITIES /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Trade and notes payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,115 5,462
Other payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111830 69,607 71,274
Current portion of derivative financial liabilities 188 –
Current portion of long-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111831 4,798 –
TOTAL CURRENT LIABILITIES /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111879,708 76,736
NET CURRENT ASSETS/(LIABILITIES) /H1118/H1118/H1118/H1118/H1118/H1118/H11182,327,021 301,355
TOTAL ASSETS LESS CURRENT LIABILITIES /H1118 3,715,041 2,984,292
NON-CURRENT LIABILITIES /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Long-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111831 529,656 –
Derivative financial liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811,153 –
TOTAL NON-CURRENT LIABILITIES /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118540,809 –
NET ASSETS /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,174,232 2,984,292
EQUITY /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Equity attributable to owners of the parent /H1118/H1118/H1118/H1118/H1118/H1118
Share capital /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,906,459 6,906,459
Reserves /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(3,732,227) (3,922,167)
TOTAL EQUITY /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,174,232 2,984,292
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-13 –


--- page 777 ---
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION
1. CORPORATE INFORMATION
Golden Star Resources Ltd. (“Golden Star” or “the Company”) is an international gold mining and exploration
company incorporated under the Canada Business Corporations Act. The Company’s registered office is located at
333 Bay Street, Suite 2400, Toronto, Ontario, M5H 2T6 Canada, and the Company has corporate offices in London,
United Kingdom and Accra, Ghana.
Through our 90% owned subsidiary, Golden Star (Wassa) Limited, the Company own and operate the Wassa
underground mine and a carbon-in-leach processing plant (collectively “Wassa”), located northeast of the town of
Tarkwa, Ghana.
As at the date of this report, the Company had direct and indirect interests in its subsidiaries, all of which are
private limited liability companies, the particulars of which are set out below:
Name*
Place and date of incorporation/
registration and place of
operations
Percentage of
equity attributable
to the Company
Principal activities
%
Direct
%
Indirect
Caystar Holdings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Cayman
7 May, 1997
100% – Management
Caystar Finance Co. /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Cayman
28 April, 2015
– 100% Finance
Caystar Management Holdings /H1118/H1118/H1118Cayman
1 September, 2003
– 100% Management
Wasford Holdings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Cayman
2 April, 2002
– 100% Management
Golden Star (Wassa) Limited /H1118/H1118/H1118/H1118Ghana
22 November, 2001
– 90% Mining
St. Jude Resources Ltd. /H1118/H1118/H1118/H1118/H1118/H1118/H1118Canada
31 May, 1985
100% – Investment
holding
Golden Star Resources (UK) Ltd. /H1118The United Kingdom
10 May, 2019
100% – Management
2. BASIS OF PREPARATION
The Historical Financial Information has been prepared in accordance with International Financial Reporting
Standards (“IFRSs”), which comprise all standards and interpretations approved by the International Accounting
Standards Board (the “IASB”). All IFRSs effective for the accounting period commencing from 1 January 2022,
together with the relevant transitional provisions, have been early adopted by the Group in the preparation of the
Historical Financial Information throughout the Relevant Periods and in the period covered by the Interim
Comparative Financial Information.
The Historical Financial Information has been prepared under the historical cost convention, except for
derivative financial instruments and financial assets at fair value through profit or loss which have been measured
at fair value.
Going concern basis
As at 31 January 2022, the Group had net current liabilities of RMB799,960,000. The directors of the Group
have given consideration to the future liquidity and performance of the Group and its available sources of finance
in assessing whether the Group will have sufficient financial resources to continue as a going concern. In order to
improve the Group’s liquidity and cash flows to sustain the Group’s operation for the next twelve months from 31
January 2022, the shareholders of the Company has undertaken to provide adequate financial support to enable the
Group to meet its liabilities as and when they fall due. Accordingly, the Historical Financial Information of the Group
has been prepared on a going concern basis.
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-14 –


--- page 778 ---
Basis of consolidation
The Historical Financial Information include the financial statements of the Company and its subsidiaries
(collectively referred to as the “Group”) for the Relevant Periods. A subsidiary is an entity (including a structured
entity), directly or indirectly, controlled by the Company. Control is achieved when the Group is exposed, or has
rights, to variable returns from its involvement with the investee and has the ability to affect those returns through
its power over the investee (i.e., existing rights that give the Group the current ability to direct the relevant activities
of the investee).
Generally, there is a presumption that a majority of voting rights results in control. When the Company has
less than a majority of the voting or similar rights of an investee, the Group considers all relevant facts and
circumstances in assessing whether it has power over an investee, including:
(a) the contractual arrangement with the other vote holders of the investee;
(b) rights arising from other contractual arrangements; and
(c) the Group’s voting rights and potential voting rights.
The financial statements of the subsidiaries are prepared for the same reporting period as the Company, using
consistent accounting policies.The results of subsidiaries are consolidated from the date on which the Group obtains
control, and continue to be consolidated until the date that such control ceases.
Profit or loss and each component of other comprehensive income are attributed to the owners of the parent
of the Group and to the non-controlling interests, even if this results in the non-controlling interests having a deficit
balance. All intra-group assets and liabilities, equity, income, expenses and cash flows relating to transactions
between members of the Group are eliminated in full on consolidation.
The Group reassesses whether or not it controls an investee if facts and circumstances indicate that there are
changes to one or more of the three elements of control described above. A change in the ownership interest of a
subsidiary, without a loss of control, is accounted for as an equity transaction.
If the Group loses control over a subsidiary, it derecognises the related assets (including goodwill), liabilities,
any non-controlling interest and the exchange fluctuation reserve; and recognises the fair value of any investment
retained and any resulting surplus or deficit in profit or loss. The Group’s share of components previously recognised
in other comprehensive income is reclassified to profit or loss or retained profits, as appropriate, on the same basis
as would be required if the Group had directly disposed of the related assets or liabilities.
3. ISSUED BUT NOT YET EFFECTIVE INTERNATIONAL FINANCIAL REPORTING STANDARDS
The Group has not applied the following new and revised IFRSs that have been issued but are not yet effective,
in the Historical Financial Information.
Amendments to IFRS 10 and IAS 28 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Sale or Contribution of Assets between an Investor
and its Associate or Joint V enture
3
Amendments to IFRS 16 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Lease Liability in a Sale and Leaseback 2
Amendment to IFRS 17 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Initial Application of IFRS 17 and IFRS 9 —
Comparative Information 5
Amendments to IAS 1 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Classification of Liabilities as Current or
Non-current (the “2020 Amendments”) 2, 4
Amendments to IAS 1 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Non-current Liabilities with Covenants (the “2022
Amendments”) 2
Amendments to IAS 1 and
IFRS Practice Statement 2 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Disclosure of Accounting Policies 1
Amendments to IAS 8 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Definition of Accounting Estimates 1
Amendments to IAS 12 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Deferred Tax related to Assets and Liabilities
arising from a Single Transaction 1
Amendments to IAS 21 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Lack of Exchangeability 6
IFRS 18 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Presentation and Disclosure in Financial
Statements 7
IFRS 19 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Subsidiaries without Public Accountability:
Disclosures 7
Amendments to IFRS 9 and IFRS 7 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Amendments to the Classification and Measurement
of Financial Instruments 8
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-15 –


--- page 779 ---
1 Effective for annual periods beginning on or after 1 January 2023
2 Effective for annual periods beginning on or after 1 January 2024
3 No mandatory effective date yet determined but available for adoption
4 As a consequence of the 2022 Amendments, the effective date of the 2020 Amendments was deferred
to annual periods beginning on or after 1 January 2024. In addition, as a consequence of the 2020
Amendments and 2022 Amendments, Hong Kong Interpretation 5 Presentation of Financial Statements
— Classification by the Borrower of a Term Loan that Contains a Repayment on Demand Clause was
revised to align the corresponding wording with no change in conclusion
5 An entity that chooses to apply the transition option relating to the classification overlay set out in this
amendment shall apply it on initial application of HKFRS 17
6 Effective for annual periods beginning on or after 1 January 2025
7 Effective for annual periods beginning on or after 1 January 2027
8 Effective for annual periods beginning on or after 1 January 2026
The Group is in the process of making an assessment of the impact of these new and revised IFRSs upon initial
application. So far, the Group considers that these new and revised IFRSs may result in changes in accounting
policies but are unlikely to have a significant impact on the Group’s result of operation and financial position.
4. MATERIAL ACCOUNTING POLICY INFORMATION
Fair value measurement
The Group measures certain of its financial assets and financial liabilities at fair value at the end of each of
the Relevant Periods. Fair value is the price that would be received to sell an asset or paid to transfer a liability in
an orderly transaction between market participants at the measurement date. The fair value measurement is based on
the presumption that the transaction to sell the asset or transfer the liability takes place either in the principal market
for the asset or liability, or in the absence of a principal market, in the most advantageous market for the asset or
liability. The principal or the most advantageous market must be accessible by the Group. The fair value of an asset
or a liability is measured using the assumptions that market participants would use when pricing the asset or liability,
assuming that market participants act in their economic best interest.
A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate
economic benefits by using the asset in its highest and best use or by selling it to another market participant that
would use the asset in its highest and best use.
The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data
are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of
unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the Historical Financial Information
are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant
to the fair value measurement as a whole:
Level 1 – based on quoted prices (unadjusted) in active markets for identical assets or liabilities
Level 2 – based on valuation techniques for which the lowest level input that is significant to the fair
value measurement is observable, either directly or indirectly
Level 3 – based on valuation techniques for which the lowest level input that is significant to the fair
value measurement is unobservable
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-16 –


--- page 780 ---
For assets and liabilities that are recognised in the Historical Financial Information on a recurring basis, the
Group determines whether transfers have occurred between levels in the hierarchy by reassessing categorisation
(based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each of
the Relevant Periods.
Impairment of non-financial assets
Where an indication of impairment exists, or when annual impairment testing for an asset is required (other
than inventories, deferred tax assets and financial assets), the asset’s recoverable amount is estimated. An asset’s
recoverable amount is the higher of the asset’s or cash-generating unit’s value in use and its fair value less costs of
disposal, and is determined for an individual asset, unless the asset does not generate cash inflows that are largely
independent of those from other assets or groups of assets, in which case the recoverable amount is determined for
the cash-generating unit to which the asset belongs. In testing a cash-generating unit for impairment, a portion of the
carrying amount of a corporate asset (e.g., a headquarters building) is allocated to an individual cash-generating unit
if it can be allocated on a reasonable and consistent basis or, otherwise, to the smallest group of cash-generating units.
An impairment loss is recognised only if the carrying amount of an asset exceeds its recoverable amount. In
assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount
rate that reflects current market assessments of the time value of money and the risks specific to the asset. An
impairment loss is charged to the statement of profit or loss in the period in which it arises in those expense categories
consistent with the function of the impaired asset.
An assessment is made at the end of each of the Relevant Periods as to whether there is an indication that
previously recognised impairment losses may no longer exist or may have decreased. If such an indication exists, the
recoverable amount is estimated. A previously recognised impairment loss of an asset other than goodwill is reversed
only if there has been a change in the estimates used to determine the recoverable amount of that asset, but not to
an amount higher than the carrying amount that would have been determined (net of any depreciation/amortisation)
had no impairment loss been recognised for the asset in prior years. A reversal of such an impairment loss is credited
to the statement of profit or loss in the period in which it arises.
Related parties
A party is considered to be related to the Group if:
(a) the party is a person or a close member of that person’s family and that person:
(i) has control or joint control over the Group;
(ii) has significant influence over the Group; or
(iii) is a member of the key management personnel of the Group or of a parent of the Group;
or
(b) the party is an entity where any of the following conditions applies:
(i) the entity and the Group are members of the same group;
(ii) one entity is an associate or joint venture of the other entity (or of a parent, subsidiary or fellow
subsidiary of the other entity);
(iii) the entity and the Group are joint ventures of the same third party;
(iv) one entity is a joint venture of a third entity and the other entity is an associate of the third entity;
(v) the entity is a post-employment benefit plan for the benefit of employees of either the Group or
an entity related to the Group;
(vi) the entity is controlled or jointly controlled by a person identified in (a);
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-17 –


--- page 781 ---
(vii) a person identified in (a)(i) has significant influence over the entity or is a member of the key
management personnel of the entity (or of a parent of the entity); and
(viii) the entity, or any member of a group of which it is a part, provides key management personnel
services to the Group or to the parent of the Group.
Property, plant and equipment and depreciation
Property, plant and equipment, other than construction in progress, are stated at cost less accumulated
depreciation and any impairment losses. The cost of an item of property, plant and equipment comprises its purchase
price and any directly attributable costs of bringing the asset to its working condition and location for its intended
use.
Expenditure incurred after items of property, plant and equipment have been put into operation, such as repairs
and maintenance, is normally charged to profit or loss in the period in which it is incurred. In situations where the
recognition criteria are satisfied, the expenditure for a major inspection is capitalised in the carrying amount of the
asset as a replacement. Where significant parts of property, plant and equipment are required to be replaced at
intervals, the Group recognises such parts as individual assets with specific useful lives and depreciates them
accordingly.
Depreciation for mobile equipment and other assets having estimated lives shorter than the estimated life of
the ore reserves is calculated using the straight-line method at rates which depreciate the cost of the assets, less their
anticipated residual values, if any, over their estimated useful lives as follows:
Estimated useful lives Annual depreciation rates
Mobile equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182 to 5 years 20% to 50%
Electronic equipment and others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182 to 5 years 20% to 50%
Where parts of an item of property, plant and equipment have different useful lives, the cost of that item is
allocated on a reasonable basis among the parts and each part is depreciated separately. Residual values, useful lives
and the depreciation method are reviewed, and adjusted if appropriate, at least at the end of each of the Relevant
Periods.
An item of property, plant and equipment including any significant part initially recognised is derecognised
upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss on disposal
or retirement recognised in the statement of profit or loss in the years/periods the asset is derecognised is the
difference between the net sales proceeds and the carrying amount of the relevant asset.
Construction in progress is stated at cost less any impairment losses, and is not depreciated. Cost comprises
the direct costs of construction and capitalised borrowing costs on related borrowed funds during the period of
construction. Construction in progress is reclassified to the appropriate category of property, plant and equipment
when completed and ready for use.
Other Intangible assets
Other intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible
assets acquired in a business combination is the fair value at the date of acquisition. The useful lives of intangible
assets are assessed to be either finite or indefinite. Intangible assets with finite lives are subsequently amortised over
the useful economic life and assessed for impairment whenever there is an indication that the intangible asset may
be impaired. Other intangible assets are amortized over the life of the proven and probable reserves to which they
relate, using a units-of production amortization method. At open pit mines the costs of removing overburden from
an ore body in order to expose ore during its initial development period are capitalized.
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-18 –


--- page 782 ---
Exploration rights and assets
Exploration and evaluation assets are stated at cost less impairment losses. Exploration and evaluation includes
costs of geological prospecting for technical consultancy and costs of feasibility study for commercial development
which incurred in the surroundings, outer ring and deep areas of the existing or externally acquired mineral
properties, and costs of drilling, trench sampling and other associated activities. Such expenditures may be
capitalized when the mineral properties are reasonably determined to be commercially available and recognized as
intangible assets after obtaining mining rights or permits, which will be amortized under the units-of-production
method. If any construction was abandoned in the development phase or belongs to the productive exploration, all
costs shall be written off and recognized in profit or loss for the current period.
Impairment reviews of exploration and evaluation assets are undertaken if events or changes in circumstances
indicate a potential impairment. The carrying value of exploration and evaluation assets is compared to the
recoverable amount, which is the higher of value-in-use and the fair value less costs of disposal. For the purposes
of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable
cash-generating units. Exploration and evaluation assets that suffered impairment are reviewed for possible reversal
of the impairment at each reporting date.
Exploration rights are stated at cost less impairment losses. Exploration rights include the cost of acquiring
exploration rights.
Mining rights are stated at cost less accumulated amortisation and any impairment losses. Mining rights
include the cost of acquiring mining licences, exploration rights and exploration and evaluation assets upon
determination that an exploration property is capable of commercial production, and the cost of acquiring interests
in the mining reserves of existing mining properties. The mining rights are amortised in accordance with the
production plans of the entities concerned and the proven and probable mineral reserves of the mines using the UOP
method. Mining rights are written off to profit or loss if the mining property is abandoned.
Leases
The Group assesses at contract inception whether a contract is, or contains, a lease. A contract is, or contains,
a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for
consideration.
Group as a lessee
The Group applies a single recognition and measurement approach for all leases, except for short-term leases
and leases of low-value assets. The Group recognises lease liabilities to make lease payments and right-of-use assets
representing the right to use the underlying assets.
(a) Right-of-use assets
Right-of-use assets are recognised at the commencement date of the lease (that is the date the underlying asset
is available for use). Right-of-use assets are measured at cost, less accumulated depreciation and any impairment
losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes the amount
of lease liabilities recognised, initial direct costs incurred, and lease payments made at or before the commencement
date less any lease incentives received. Right-of-use assets are depreciated on a straight-line basis over the shorter
of the lease terms and the estimated useful lives of the assets as follows:
Leasehold land /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111850 years
Buildings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183 to 5 years
Machinery and vehicles /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182 to 5 years
If ownership of the leased asset transfers to the Group by the end of the lease term or the cost reflects the
exercise of a purchase option, depreciation is calculated using the estimated useful life of the asset.
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-19 –


--- page 783 ---
(b) Lease liabilities
Lease liabilities are recognised at the commencement date of the lease at the present value of lease payments
to be made over the lease term. The lease payments include fixed payments (including in-substance fixed payments)
less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts expected
to be paid under residual value guarantees. The lease payments also include the exercise price of a purchase option
reasonably certain to be exercised by the Group and payments of penalties for termination of a lease, if the lease term
reflects the Group exercising the option to terminate the lease. The variable lease payments that do not depend on
an index or a rate are recognised as an expense in the period in which the event or condition that triggers the payment
occurs.
In calculating the present value of lease payments, the Group uses its incremental borrowing rate at the lease
commencement date because the interest rate implicit in the lease is not readily determinable. After the
commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for
the lease payments made. In addition, the carrying amount of lease liabilities is remeasured if there is a modification,
a change in the lease term, a change in lease payments (e.g., a change to future lease payments resulting from a
change in an index or rate) or a change in assessment of an option to purchase the underlying asset.
(c) Short-term leases and leases of low-value assets
The Group applies the short-term lease recognition exemption to its short-term leases of office premises (that
is those leases that have a lease term of 12 months or less from the commencement date and do not contain a purchase
option). It also applies the recognition exemption for leases of low-value assets to leases of office equipment and
laptop computers that are considered to be of low value. Lease payments on short-term leases and leases of low-value
assets are recognised as an expense on a straight-line basis over the lease term.
Investments and other financial assets
Initial recognition and measurement
Financial assets are classified, at initial recognition, as subsequently measured at amortised cost, fair value
through other comprehensive income, and fair value through profit or loss.
The classification of financial assets at initial recognition depends on the financial asset’s contractual cash
flow characteristics and the Group’s business model for managing them. With the exception of trade receivables that
do not contain a significant financing component or for which the Group has applied the practical expedient of not
adjusting the effect of a significant financing component, the Group initially measures a financial asset at its fair
value, plus in the case of a financial asset not at fair value through profit or loss, transaction costs. Trade receivables
that do not contain a significant financing component or for which the Group has applied the practical expedient are
measured at the transaction price determined under IFRS 15 in accordance with the policies set out for “Revenue
recognition” below.
In order for a financial asset to be classified and measured at amortised cost or fair value through other
comprehensive income, it needs to give rise to cash flows that are solely payments of principal and interest (“SPPI”)
on the principal amount outstanding. Financial assets with cash flows that are not SPPI are classified and measured
at fair value through profit or loss, irrespective of the business model.
The Group’s business model for managing financial assets refers to how it manages its financial assets in order
to generate cash flows. The business model determines whether cash flows will result from collecting contractual
cash flows, selling the financial assets, or both. Financial assets classified and measured at amortised cost are held
within a business model with the objective to hold financial assets in order to collect contractual cash flows, while
financial assets classified and measured at fair value through other comprehensive income are held within a business
model with the objective of both holding to collect contractual cash flows and selling. Financial assets which are not
held within the aforementioned business models are classified and measured at fair value through profit or loss.
Purchases or sales of financial assets that require delivery of assets within the period generally established by
regulation or convention in the marketplace are recognised on the trade date, that is, the date that the Group commits
to purchase or sell the asset.
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-20 –


--- page 784 ---
Subsequent measurement
The subsequent measurement of financial assets depends on their classification as follows:
Financial assets at amortised cost (debt instruments)
Financial assets at amortised cost are subsequently measured using the effective interest method and are
subject to impairment. Gains and losses are recognised in profit or loss when the asset is derecognised, modified or
impaired.
Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss are carried in the statement of financial position at fair value
with net changes in fair value recognised in the statement of profit or loss.
This category includes derivative instruments and equity investments which the Group had not irrevocably
elected to classify at fair value through other comprehensive income. Dividends on the equity investments are also
recognised as other income in the statement of profit or loss when the right of payment has been established.
A derivative embedded in a hybrid contract, with a financial liability or non-financial host, is separated from
the host and accounted for as a separate derivative if the economic characteristics and risks are not closely related
to the host; a separate instrument with the same terms as the embedded derivative would meet the definition of a
derivative; and the hybrid contract is not measured at fair value through profit or loss. Embedded derivatives are
measured at fair value with changes in fair value recognised in the statement of profit or loss. Reassessment only
occurs if there is either a change in the terms of the contract that significantly modifies the cash flows that would
otherwise be required or a reclassification of a financial asset out of the fair value through profit or loss category.
A derivative embedded within a hybrid contract containing a financial asset host is not accounted for
separately. The financial asset host together with the embedded derivative is required to be classified in its entirety
as a financial asset at fair value through profit or loss.
Derecognition of financial assets
A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets)
is primarily derecognised (i.e., removed from the Group’s consolidated statements of financial position) when:
 the rights to receive cash flows from the asset have expired; or
 the Group has transferred its rights to receive cash flows from the asset or has assumed an obligation
to pay the received cash flows in full without material delay to a third party under a “pass-through”
arrangement; and either (a) the Group has transferred substantially all the risks and rewards of the asset,
or (b) the Group has neither transferred nor retained substantially all the risks and rewards of the asset,
but has transferred control of the asset.
When the Group has transferred its rights to receive cash flows from an asset or has entered into a pass-through
arrangement, it evaluates if, and to what extent, it has retained the risk and rewards of ownership of the asset. When
it has neither transferred nor retained substantially all the risks and rewards of the asset nor transferred control of
the asset, the Group continues to recognise the transferred asset to the extent of the Group’s continuing involvement.
In that case, the Group also recognises an associated liability. The transferred asset and the associated liability are
measured on a basis that reflects the rights and obligations that the Group has retained.
Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower
of the original carrying amount of the asset and the maximum amount of consideration that the Group could be
required to repay.
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-21 –


--- page 785 ---
Impairment of financial assets
The Group recognises an allowance for expected credit losses (“ECLs”) for all debt instruments not held at fair
value through profit or loss. ECLs are based on the difference between the contractual cash flows due in accordance
with the contract and all the cash flows that the Group expects to receive, discounted at an approximation of the
original effective interest rate. The expected cash flows will include cash flows from the sale of collateral held or
other credit enhancements that are integral to the contractual terms.
General approach
ECLs are recognised in two stages. For credit exposures for which there has not been a significant increase
in credit risk since initial recognition, ECLs are provided for credit losses that result from default events that are
possible within the next 12 months (a 12-month ECL). For those credit exposures for which there has been a
significant increase in credit risk since initial recognition, a loss allowance is required for credit losses expected over
the remaining life of the exposure, irrespective of the timing of the default (a lifetime ECL).
At each reporting date, the Group assesses whether the credit risk on a financial instrument has increased
significantly since initial recognition. When making the assessment, the Group compares the risk of a default
occurring on the financial instrument as at the reporting date with the risk of a default occurring on the financial
instrument as at the date of initial recognition and considers reasonable and supportable information that is available
without undue cost or effort, including historical and forward-looking information.
The Group considers a financial asset in default when contractual payments are 90 days past due. However,
in certain cases, the Group may also consider a financial asset to be in default when internal or external information
indicates that the Group is unlikely to receive the outstanding contractual amounts in full before taking into account
any credit enhancements held by the Group.
A financial asset is written off when there is no reasonable expectation of recovering the contractual cash
flows.
Financial assets at amortised cost are subject to impairment under the general approach and they are classified
within the following stages for measurement of ECLs except for trade receivables which apply the simplified
approach as detailed below.
Stage 1 – Financial instruments for which credit risk has not increased significantly since initial
recognition and for which the loss allowance is measured at an amount equal to 12-month
ECLs;
Stage 2 – Financial instruments for which credit risk has increased significantly since initial
recognition but that are not credit-impaired financial assets and for which the loss
allowance is measured at an amount equal to lifetime ECLs;
Stage 3 – Financial assets that are credit-impaired at the reporting date (but that are not purchased
or originated credit-impaired) and for which the loss allowance is measured at an amount
equal to lifetime ECLs.
Simplified approach
For trade receivables that do not contain a significant financing component or when the Group applies the
practical expedient of not adjusting the effect of a significant financing component, the Group applies the simplified
approach in calculating ECLs. Under the simplified approach, the Group does not track changes in credit risk, but
instead recognises a loss allowance based on lifetime ECLs at each reporting date. The Group has established a
provision matrix that is based on its historical credit loss experience, adjusted for forward-looking factors specific
to the debtors and the economic environment.
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-22 –


--- page 786 ---
Financial liabilities
Initial recognition and measurement
Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or
loss, loans and borrowings, or payables, as appropriate.
All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings and
payables, net of directly attributable transaction costs.
The Group’s financial liabilities include trade and notes payables, financial liabilities at fair value through
profit or loss, other payables and accruals, other non-current liabilities and loans.
Subsequent measurement
The subsequent measurement of financial liabilities depends on their classification as follows:
Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial
liabilities designated upon initial recognition as at fair value through profit or loss.
Financial liabilities are classified as held for trading if they are incurred for the purpose of repurchasing in the
near term. This category also includes derivative financial instruments entered into by the Group that are not
designated as hedging instruments in hedge relationships as defined by IFRS 9. Separated embedded derivatives are
also classified as held for trading unless they are designated as effective hedging instruments.
Financial liabilities designated upon initial recognition as at fair value through profit or loss are designated at
the initial date of recognition, and only if the criteria in IFRS 9 are satisfied. Gains or losses on liabilities designated
at fair value through profit or loss are recognised in the statement of profit or loss, except for the gains or losses
arising from the Group’s own credit risk which are presented in other comprehensive income with no subsequent
reclassification to the statement of profit or loss. The net fair value gain or loss recognised in the statement of profit
or loss does not include any interest charged on these financial liabilities.
Financial liabilities at amortised cost (trade and notes payables, other payables and accruals and loans)
After initial recognition, payables and loans are subsequently measured at amortised cost, using the effective
interest rate method unless the effect of discounting would be immaterial, in which case they are stated at cost. Gains
and losses are recognised in profit or loss when the liabilities are derecognised as well as through the effective
interest rate amortisation process.
Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs
that are an integral part of the effective interest rate. The effective interest rate amortisation is included in finance
costs in profit or loss.
Derecognition of financial liabilities
A financial liability is derecognised when the obligation under the liability is discharged or cancelled, or
expires.
When an existing financial liability is replaced by another from the same lender on substantially different
terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as
a derecognition of the original liability and a recognition of a new liability, and the difference between the respective
carrying amounts is recognised in profit or loss.
Offsetting of financial instruments
Financial assets and financial liabilities are offset and the net amount is reported in the statement of financial
position if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to
settle on a net basis, or to realise the assets and settle the liabilities simultaneously.
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-23 –


--- page 787 ---
Derivative financial instruments
Initial recognition and subsequent measurement
The Group uses derivative financial instruments, such as non-hedge derivative contracts, to hedge its price
fluctuation risk, respectively. Such derivative financial instruments are initially recognised at fair value on the date
on which a derivative contract is entered into and are subsequently remeasured at fair value. Derivatives are carried
as assets when the fair value is positive and as liabilities when the fair value is negative.
Any gains or losses arising from changes in fair value of derivatives are taken directly to the statement of profit
or loss, except for the effective portion of cash flow hedges, which is recognised in other comprehensive income and
later reclassified to profit or loss when the hedged item affects profit or loss.
For the purpose of hedge accounting, hedges are classified as:
 fair value hedges when hedging the exposure to changes in the fair value of a recognised asset or
liability or an unrecognised firm commitment; or
 cash flow hedges when hedging the exposure to variability in cash flows that is either attributable to a
particular risk associated with a recognised asset or liability or a highly probable forecast transaction,
or a foreign currency risk in an unrecognised firm commitment.
At the inception of a hedge relationship, the Group formally designates and documents the hedge relationship
to which the Group wishes to apply hedge accounting, the risk management objective and its strategy for undertaking
the hedge.
The documentation includes identification of the hedging instrument, the hedged item, the nature of the risk
being hedged and how the Group will assess whether the hedging relationship meets the hedge effectiveness
requirements (including the analysis of sources of hedge ineffectiveness and how the hedge ratio is determined). A
hedging relationship qualifies for hedge accounting if it meets all of the following effectiveness requirements:
 There is “an economic relationship” between the hedged item and the hedging instrument.
 The effect of credit risk does not “dominate the value changes” that result from that economic
relationship.
 The hedge ratio of the hedging relationship is the same as that resulting from the quantity of the hedged
item that the Group actually hedges and the quantity of the hedging instrument that the Group actually
uses to hedge that quantity of hedged item.
Inventories
Inventories are stated at the lower of cost and net realisable value. Cost is determined on the weighted average
basis and, in the case of work in progress and finished goods, comprises direct materials, direct labour and an
appropriate proportion of overheads. Net realisable value is based on estimated selling prices less any estimated costs
to be incurred to completion and disposal.
Cash and cash equivalents
Cash and cash equivalents in the statement of financial position comprise cash on hand and at banks, and
short-term highly liquid deposits with a maturity of generally within three months that are readily convertible into
known amounts of cash, subject to an insignificant risk of changes in value and held for the purpose of meeting
short-term cash commitments.
For the purpose of the consolidated statements of financial position, cash and cash equivalents comprise cash
on hand and at banks, including term deposits, and assets similar in nature to cash, which are not restricted as to use.
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-24 –


--- page 788 ---
Provisions
A provision is recognised when a present obligation (legal or constructive) has arisen as a result of a past event
and it is probable that a future outflow of resources will be required to settle the obligation, provided that a reliable
estimate can be made of the amount of the obligation.
When the effect of discounting is material, the amount recognised for a provision is the present value at the
end of each of the Relevant Periods of the future expenditures expected to be required to settle the obligation. The
increase in the discounted present value amount arising from the passage of time is included in finance costs in profit
or loss.
Provisions for the Group’s obligations for environmental rehabilitation and restoration of mines are based on
estimates of required expenditure at the mines in accordance with the local rules and regulations where the mines are
located. The Group estimates its liabilities for final reclamation and mine closure based upon detailed calculations
of the amount and timing of the future cash expenditure for the required work. Spending estimates are escalated for
inflation, then discounted at a discount rate that reflects current market assessments of the time value of money and
the risks specific to the liability such that the amount of provision reflects the present value of the expenditures
expected to be required to settle the obligation. The Group records a corresponding asset in the period in which the
liability is incurred. The liability is accreted to the projected expenditure date. As changes in estimates occur (such
as mine plan revisions, changes in estimated costs, or changes in the timing of the performance of reclamation
activities), the revisions to the obligation and the asset are recognised at the appropriate discount rate.
Income tax
Income tax comprises current and deferred tax. Income tax relating to items recognised outside profit or loss
is recognised outside profit or loss, either in other comprehensive income or directly in equity.
Current tax assets and liabilities are measured at the amount expected to be recovered from or paid to the
taxation authorities, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of
each of the Relevant Periods, taking into consideration interpretations and practices prevailing in the countries in
which the Group operates.
Deferred tax is provided, using the liability method, on all temporary differences at the end of each of the
Relevant Periods between the tax bases of assets and liabilities and their carrying amounts for financial reporting
purposes.
Deferred tax liabilities are recognised for all taxable temporary differences, except:
 when the deferred tax liability arises from the initial recognition of goodwill or an asset or liability in
a transaction that is not a business combination and, at the time of the transaction, affects neither the
accounting profit nor taxable profit or loss and does not give rise to equal taxable; and
 in respect of taxable temporary differences associated with investments in subsidiaries and associates,
when the timing of the reversal of the temporary differences can be controlled and it is probable that
the temporary differences will not reverse in the foreseeable future.
Deferred tax assets are recognised for all deductible temporary differences, and the carry forward of unused
tax credits and any unused tax losses. Deferred tax assets are recognised to the extent that it is probable that taxable
profit will be available against which the deductible temporary differences, and the carry forward of unused tax
credits and unused tax losses can be utilised, except:
 when the deferred tax asset relating to the deductible temporary differences arises from the initial
recognition of an asset or liability in a transaction that is not a business combination and, at the time
of the transaction, affects neither the accounting profit nor taxable profit or loss and deductible
temporary differences; and
 in respect of deductible temporary differences associated with investments in subsidiaries and
associates, deferred tax assets are only recognised to the extent that it is probable that the temporary
differences will reverse in the foreseeable future and taxable profit will be available against which the
temporary differences can be utilised.
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-25 –


--- page 789 ---
The carrying amount of deferred tax assets is reviewed at the end of each of the Relevant Periods and reduced
to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the
deferred tax asset to be utilised. Unrecognised deferred tax assets are reassessed at the end of each of the Relevant
Periods and are recognised to the extent that it has become probable that sufficient taxable profit will be available
to allow all or part of the deferred tax asset to be recovered.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period when
the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively
enacted by the end of each of the Relevant Periods.
Deferred tax assets and deferred tax liabilities are offset if and only if the Group has a legally enforceable right
to set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax liabilities relate to
income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities which
intend either to settle current tax liabilities and assets on a net basis, or to realise the assets and settle the liabilities
simultaneously, in each future period in which significant amounts of deferred tax liabilities or assets are expected
to be settled or recovered.
Revenue recognition
Revenue from contracts with customers
Revenue from contracts with customers is recognised when control of goods or services is transferred to the
customers at an amount that reflects the consideration to which the Group expects to be entitled in exchange for those
goods or services.
When the contract contains a financing component which provides the customer with a significant benefit of
financing the transfer of goods or services to the customer for more than one year, revenue is measured at the present
value of the amount receivable, discounted using the discount rate that would be reflected in a separate financing
transaction between the Group and the customer at contract inception. When the contract contains a financing
component which provides the Group with a significant financial benefit for more than one year, revenue recognised
under the contract includes the interest expense accreted on the contract liability under the effective interest method.
For a contract where the period between the payment by the customer and the transfer of the promised goods or
services is one year or less, the transaction price is not adjusted for the effects of a significant financing component,
using the practical expedient in IFRS 15.
Sale of products
Revenue from the sale of products is recognised at the point in time when control of the asset is transferred
to the customer, generally on delivery of the products.
Gold streaming arrangement
Under the Metal Streaming Arrangement, the Group receives a payment in advance and the counterparty
obtains a certain proportion of deliverable gold within the entire life of the designated mine. The counterparty is also
required to pay an additional payment based on a certain proportion of the market price when the Group delivers the
goods within an agreed period in the future. The payment the Group receives in advance is considered to be part of
the counterparty’s prepayment for the future goods with uncertain but predictable quantity, and is recognized as a
contract liability upon receipt. Each unit of the delivered goods represents a separate performance obligation, and
revenue is recognized at the point in time when control of the goods is transferred. Considering the timing of
satisfaction of delivery obligations throughout the entire life of the mines, the contract liability above is considered
to have significant financing components. In addition, because the quantity of all delivered goods available to the
counterparty depends on the mining reserves of the metals throughout the entire life of the mines, the management
will estimate the change of total metal reserves and change of planned mining reserves on a regular basis and
adjustments shall be made to the revenue and finance costs accordingly.
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-26 –


--- page 790 ---
V ariable consideration
In the Group’s Metal Streaming Arrangement, because the quantity of all delivered goods available to the
counterparty depends on the mining reserves of the metals throughout the entire life of the mines, the price allocated
to goods delivered per unit is considered as variable consideration. When the estimated total metal reserves and
planned exploration reserves of the mine change, it is necessary to recalculate the price of goods delivered per unit,
and in the period of changes occurred, adjust the revenue and finance costs recognised in the period according to the
updated price. The Group determines the best estimate of variable consideration by the expected value. The
transaction price including variable consideration is only to the extent that it is highly probable that a significant
reversal in the amount of cumulative revenue recognised will not occur when the uncertainty associated with the
variable consideration is subsequently resolved.
Contract liabilities
A contract liability is recognised when a payment is received or a payment is due (whichever is earlier) from
a customer before the Group transfers the related goods or services. Contract liabilities are recognised as revenue
when the Group performs under the contract (i.e., transfers control of the related goods or services to the customer).
Share Incentive Plan
The Company operates employee stock ownership plans. Employees (including directors) of the Group receive
remuneration in the form of share-based payments, whereby employees render services in exchange for equity
instruments (“equity-settled transactions”). The cost of equity-settled transactions with employees is measured by
reference to the fair value at the date at which they are granted. The fair value is determined by the market price of
the granted shares, further details of which are given in note 40 to the Historical Financial Information.
The cost of equity-settled transactions is recognised in employee benefit expense, together with a
corresponding increase in equity, over the period in which the performance and/or service conditions are fulfilled.
The cumulative expense recognised for equity-settled transactions at the end of each reporting period until the vesting
date reflects the extent to which the vesting period has expired and the Group’s best estimate of the number of equity
instruments that will ultimately vest. The charge or credit to the statement of profit or loss for a period represents
the movement in the cumulative expense recognised as at the beginning and end of that period.
Service and non-market performance conditions are not taken into account when determining the grant date
fair value of awards, but the likelihood of the conditions being met is assessed as part of the Group’s best estimate
of the number of equity instruments that will ultimately vest. Market performance conditions are reflected within the
grant date fair value. Any other conditions attached to an award, but without an associated service requirement, are
considered to be non-vesting conditions. Non-vesting conditions are reflected in the fair value of an award and lead
to an immediate expensing of an award unless there are also service and/or performance conditions.
For awards that do not ultimately vest because non-market performance and/or service conditions have not
been met, no expense is recognised. Where awards include a market or non-vesting condition, the transactions are
treated as vesting irrespective of whether the market or non-vesting condition is satisfied, provided that all other
performance and/or service conditions are satisfied.
Where the terms of an equity-settled award are modified, as a minimum an expense is recognised as if the
terms had not been modified, if the original terms of the award are met. In addition, an expense is recognised for any
modification that increases the total fair value of the share-based payments, or is otherwise beneficial to the employee
as measured at the date of modification. Where an equity-settled award is cancelled, it is treated as if it had vested
on the date of cancellation, and any expense not yet recognised for the award is recognised immediately.
Borrowing costs
Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, i.e.,
assets that necessarily take a substantial period of time to get ready for their intended use or sale, are capitalised as
part of the cost of those assets. The capitalisation of such borrowing costs ceases when the assets are substantially
ready for their intended use or sale. All other borrowing costs are expensed in the period in which they are incurred.
Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds.
Dividends
Final dividends are recognised as a liability when they are approved by the shareholders in a general meeting.
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-27 –


--- page 791 ---
Foreign currencies
The Historical Financial Information is presented in Renminbi, which is the functional currency of Chifeng
Jilong Gold Mining Co., Ltd., the indirect parent company of the Company. Each entity in the Group determines its
own functional currency and items included in the financial statements of each entity are measured using that
functional currency. Foreign currency transactions recorded by the entities in the Group are initially recorded using
their respective functional currency rates prevailing at the dates of the transactions. Monetary assets and liabilities
denominated in foreign currencies are translated at the functional currency rates of exchange ruling at the end of each
of the Relevant Periods. Differences arising on settlement or translation of monetary items are recognised in profit
or loss.
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the
exchange rates at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign currency
are translated using the exchange rates at the date when the fair value was measured. The gain or loss arising on
translation of a non-monetary item measured at fair value is treated in line with the recognition of the gain or loss
on change in fair value of the item (i.e., translation difference on the item whose fair value gain or loss is recognised
in other comprehensive income or profit or loss is also recognised in other comprehensive income or profit or loss,
respectively).
In determining the exchange rate on initial recognition of the related asset, expense or income on the
derecognition of a non-monetary asset or non-monetary liability relating to an advance consideration, the date of
initial transaction is the date on which the Group initially recognises the non-monetary asset or non-monetary liability
arising from the advance consideration. If there are multiple payments or receipts in advance, the Group determines
the transaction date for each payment or receipt of the advance consideration.
The functional currencies of the Company and its subsidiaries are US Dollar. As at the end of the reporting
period, the assets and liabilities of these entities are translated into RMB at the exchange rates prevailing at the end
of the reporting period and their statements of profit or loss are translated into RMB at the exchange rates that
approximate to those prevailing at the dates of the transactions.
The resulting exchange differences are recognised in other comprehensive income and accumulated in the
exchange fluctuation reserve, except to the extent that the differences are attributable to non-controlling interests. On
disposal of a foreign operation, the cumulative amount in the reserve relating to that particular foreign operation is
recognised in the statement of profit or loss.
For the purpose of the consolidated statement of cash flows, the cash flows of overseas subsidiaries are
translated into RMB at the exchange rates ruling at the dates of the cash flows. Frequently recurring cash flows of
overseas subsidiaries which arise throughout the year are translated into RMB at the weighted average exchange rates
or the year.
5. SIGNIFICANT ACCOUNTING JUDGEMENTS AND ESTIMATES
The preparation of the Group’s Historical Financial Information requires management to make judgements,
estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the
disclosure of contingent liabilities at the end of each of the Relevant Periods. Uncertainty about these estimates and
assumptions could result in outcomes that could require a material adjustment to the carrying amount of the asset or
liability affected in the future.
Judgements
In the process of applying the Group’s accounting policies, management has made the following judgements
which have the most significant effects on the amounts recognized in the financial statements:
Corporate income tax
As a result of the fact that certain matters relating to the corporate income taxes have not been confirmed by
the local tax bureau as at the end of the reporting period, objective estimates based on currently enacted tax laws,
regulations and other related policies are required in determining the provision for corporate income tax expenses to
be made for the reporting period. Where the final tax outcome of these matters is different from the amounts
originally recorded, the differences will be accounted for in the income tax expenses in the period in which the
differences are realized.
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-28 –


--- page 792 ---
Exploration expenditures
After determining the capitalization amount of exploration expenditures, the Group will regularly evaluate the
exploration results. If the reviewed geological exploration report shows that there are no prospecting results or no
economically recoverable reserves, or that the economic benefits of mining cannot be achieved and further
exploration is unnecessary due to low grade and hard-to-mining, the exploration and development costs previously
collected will be expensed and included in the profit and loss for the current period in a lump sum.
Estimation uncertainty
The key assumptions concerning the future and other key sources of estimation uncertainty at the balance sheet
date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities
within the future accounting periods, are described below.
Impairment of non-current assets other than financial assets (excluding goodwill)
The Group assesses whether there are any indicators of impairment for non-current assets other than financial
assets at the end of the reporting period. Intangible assets with indefinite useful lives are tested for impairment
annually and at other times when such an indicator exists. Other non-current assets other than financial assets are
tested for impairment when there are indicators that the carrying amounts may not be recoverable. An impairment
exists when the carrying value of an asset or asset group exceeds its recoverable amount, which is the higher of its
fair value less costs of disposal and its value in use The calculation of the fair value less costs of disposal based on
available data from binding sales transactions in an arm’s length transaction of similar assets or observable market
prices less incremental costs for disposing of the asset. When value in use calculations are undertaken, management
must estimate the expected future cash flows from the asset or asset group and choose a suitable discount rate in order
to calculate the present value of those cash flows.
Proved mineral reserves
Proved mineral reserves are estimated based on professional knowledge, experience and industry practice.
Generally, the mineral reserve volume estimated based on probing and estimation may not be very accurate. The
estimation is updated in accordance with new technologies and new information. Any changes in estimation will have
impacts on amounts of mining assets’ depreciation and mining rights’ amortization using the units-of-production
method, on the stripping ratio which was used in the capitalization of stripping costs, and on each of transaction
prices of the gold streaming arrangement, etc. This may result in changes of or impacts on the Group’s development
and operation plan, and hence the Group’s operation and operating results.
Deferred tax assets
To the extent that it is probable that there are sufficient taxable profits to offset the deductible losses, deferred
tax assets shall be recognized for all unused deductible losses. Substantial management’s judgements regarding the
timing, amount of future taxable profit as well as tax planning strategies are needed when estimating the amount of
deferred tax assets.
Provision for environmental rehabilitation and restoration of mines
Pursuant to the regulations of the governmental authorities in the places where the mines are located, the Group
recognizes provision for environmental rehabilitation and restoration of mines. The amount of provision is an
estimate based upon the life of mining tenements, timing of mine closure and cost of such rehabilitation. When this
estimate changes, it may affect the Group’s operations and performance.
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-29 –


--- page 793 ---
6. SEGMENT INFORMATION
The Group is principally engaged in gold mining and exploration. Information reported to the Group’s chief
operating decision maker, for the purpose of resource allocation and performance assessment, focuses on the
operating results of the Group as a whole as the Group’s resources are integrated and no discrete operating segment
information is available. Accordingly, no further operating segment information is presented.
Geographical information
During the Relevant Periods and the one month ended 31 January 2021, the Group operated in the same
geographical location, as all its revenue was generated in Ghana, and all its long-term assets and capital expenditures
were also located and incurred in Ghana. Therefore, no information on other regions is presented.
As at 31 December 2021, 31 January 2021, and 31 January 2022, revenue from contracts with a single customer
amounted to approximately RMB1,593,512,000, RMB114,649,000, and RMB106,001,000 respectively, which were
derived from sales of good by the group and contributing more than 10% of the Group’s total revenue.
7. REVENUE
An analysis of revenue is as follows:
Y ear ended
31 December
2021
One month ended
31 January
2021
One month ended
31 January
2022
RMB’000 RMB’000 RMB’000
(unaudited)
Revenue from contracts with customers /H1118/H1118/H1118/H1118/H1118/H1118/H11181,671,379 120,733 111,476
1,671,379 120,733 111,476
Revenue from contracts with customers
(a) Disaggregated revenue information
Y ear ended
31 December
2021
One month ended
31 January
2021
One month ended
31 January
2022
RMB’000 RMB’000 RMB’000
(unaudited)
Type of goods
Gold /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,671,379 120,733 111,476
1,671,379 120,733 111,476
Geographical markets
Ghana /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,671,379 120,733 111,476
1,671,379 120,733 111,476
Timing of revenue recognition
Goods transferred at a point in time /H1118/H1118/H1118/H1118/H1118/H1118/H11181,671,379 120,733 111,476
1,671,379 120,733 111,476
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-30 –


--- page 794 ---
The following table shows the amounts of revenue recognised in the Relevant Periods and the one month ended
31 January 2021 that were included in the contract liabilities at the beginning of the reporting period:
Y ear ended
31 December
2021
One month ended
31 January
2021
One month ended
31 January
2022
RMB’000 RMB’000 RMB’000
(unaudited)
Revenue recognised that was included in
contract liabilities at the beginning of the
reporting period:
Sale of gold from Metal Streaming from
arrangement (note 29) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111844,236 3,230 2,934
44,236 3,230 2,934
(b) Information about the Group’s performance obligations is summarised below:
Sale of goods
The Group recognizes revenue when customers gain the control of goods. Prepayments received from
customers before delivery of goods are recognized as contract liabilities in the consolidated financial
statements. Among them, the sales arrangement related to Metal Streaming Arrangement is detailed in note 29.
The transaction prices allocated to remaining performance obligations (unsatisfied or partially
unsatisfied) related to sales of gold are as follows:
Y ear ended
31 December
2021
One month ended
31 January
2021
One month ended
31 January
2022
RMB’000 RMB’000 RMB’000
(unaudited)
Within 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111850,619 57,149 50,610
Over 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118591,866 617,640 590,143
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118642,485 674,789 640,753
8. DIRECTORS’ REMUNERATION
Directors’ remuneration is as follows:
Y ear ended
31 December 2021
One month ended
31 January 2021
One month ended
31 January 2022
RMB’000 RMB’000 RMB’000
(unaudited)
Fees /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,135 (212) 830
Other emoluments:
Salaries, allowances and benefits in kind /H1118/H1118/H1118/H1118/H1118/H11183,543 299 470
Social insurance and housing fund /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118486 41 360
Share based compensation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187,578 1,033 36,301
17,742 1,161 37,961
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-31 –


--- page 795 ---
Directors’ remuneration for each year/period is as follows:
Y ear ended 31 December 2021
Position Fees
Salaries,
allowances and
benefits in kind
Share based
compensation
Social
insurance and
housing fund Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Andrew Wray /H1118/H1118/H1118/H1118Director – 3,543 2,235 486 6,264
Ani Markova /H1118/H1118/H1118/H1118/H1118Independent
Director
614 – 522 – 1,136
Anu Dhir /H1118/H1118/H1118/H1118/H1118/H1118/H1118Independent
Director
514 – 716 – 1,230
Craig Nelsen /H1118/H1118/H1118/H1118/H1118Independent
Director
756 – 480 – 1,236
Gilmour Clausen /H1118/H1118/H1118Independent
Director
610 – 585 – 1,195
Karim Nasr /H1118/H1118/H1118/H1118/H1118/H1118Independent
Director
292 – 899 – 1,191
Mona Quartey /H1118/H1118/H1118/H1118Independent
Director
749 – 663 – 1,412
Karen Akiwumi-
Tanoh /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Independent
Director
328 – 191 – 519
Gerard De Hert /H1118/H1118/H1118Independent
Director
344 – 191 – 535
Tim Baker /H1118/H1118/H1118/H1118/H1118/H1118/H1118Independent
Director
1,021 – 792 – 1,813
Robert Doyle /H1118/H1118/H1118/H1118/H1118Independent
Director
312 – 304 – 616
Alexander Nsiah /H1118/H1118/H1118Independent
Director
1 8 6––– 1 8 6
Amadeus Y usef
Kwasi Disu /H1118/H1118/H1118/H1118
Independent
Director
1 1 6––– 1 1 6
Daniel Owiredu /H1118/H1118/H1118Independent
Director
2 9 3––– 2 9 3
6,135 3,543 7,578 486 17,742
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-32 –


--- page 796 ---
Directors’ remuneration for each year/period is as follows:
One month ended 31 January 2021
Position Fees
Salaries,
allowances and
benefits in kind
Share based
compensation
Social
insurance and
housing fund Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Andrew Wray /H1118/H1118/H1118/H1118Director – 299 111 41 451
Ani Markova /H1118/H1118/H1118/H1118/H1118Independent
Director
(30) – 93 – 63
Anu Dhir /H1118/H1118/H1118/H1118/H1118/H1118/H1118Independent
Director
(34) – 81 – 47
Craig Nelsen /H1118/H1118/H1118/H1118/H1118Independent
Director
(37) – 81 – 44
Gilmour Clausen /H1118/H1118/H1118Independent
Director
(30) – 111 – 81
Karim Nasr /H1118/H1118/H1118/H1118/H1118/H1118Independent
Director
(12) – 202 – 190
Mona Quartey /H1118/H1118/H1118/H1118Independent
Director
(12) – 111 – 99
Tim Baker /H1118/H1118/H1118/H1118/H1118/H1118/H1118Independent
Director
(53) – 162 – 109
Robert Doyle /H1118/H1118/H1118/H1118/H1118Independent
Director
(36) – 81 – 45
Alexander Nsiah /H1118/H1118/H1118Independent
Director
1 6––– 1 6
Amadeus Y usef
Kwasi Disu /H1118/H1118/H1118/H1118
Independent
Director
1 6––– 1 6
(212) 299 1,033 41 1,161
Directors’ remuneration for each year/period is as follows:
One month ended 31 January 2022
Position Fees
Salaries,
allowances and
benefits in kind
Share based
compensation
Social
insurance and
housing fund Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Andrew Wray /H1118/H1118/H1118/H1118Director – 470 36,301 360 37,131
Ani Markova /H1118/H1118/H1118/H1118/H1118Independent
Director
8 0––– 8 0
Anu Dhir /H1118/H1118/H1118/H1118/H1118/H1118/H1118Independent
Director
8 0––– 8 0
Craig Nelsen /H1118/H1118/H1118/H1118/H1118Independent
Director
8 0––– 8 0
Gilmour Clausen /H1118/H1118/H1118Independent
Director
8 0––– 8 0
Karim Nasr /H1118/H1118/H1118/H1118/H1118/H1118Independent
Director
8 0––– 8 0
Mona Quartey /H1118/H1118/H1118/H1118Independent
Director
9 5––– 9 5
Karen Akiwumi-
Tanoh /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Independent
Director
8 0––– 8 0
Gerard De Hert /H1118/H1118/H1118Independent
Director
8 0––– 8 0
Tim Baker /H1118/H1118/H1118/H1118/H1118/H1118/H1118Independent
Director
1 6 0––– 1 6 0
Alexander Nsiah /H1118/H1118/H1118Independent
Director
1 5––– 1 5
830 470 36,301 360 37,961
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-33 –


--- page 797 ---
9. FIVE HIGHEST PAID EMPLOYEES
The five highest paid employees during the year ended 31 December 2021, and one month ended 31 January
2021 and 2022 each included one director, details of whose remuneration are set out in note 7 above. Details of the
remuneration for the Relevant Periods of the remaining highest paid employees who are neither a director nor chief
executive of the Company are as follows:
Y ear ended
31 December 2021
One month ended
31 January 2021
One month ended
31 January 2022
RMB’000 RMB’000 RMB’000
(unaudited)
Salaries, allowances and benefits in kind /H1118/H1118/H1118/H1118/H1118/H11185,300 410 589
Share based compensation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,972 – 352
7,272 410 941
The number of non-director and non-chief executive highest paid employees whose remuneration fell within
the following bands is as follows:
Y ear ended
31 December 2021
One month ended
31 January 2021
One month ended
31 January 2022
(unaudited)
Nil to 200,000 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–43
200,001 to 1,000,000 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––1
1,000,001 to 2,000,000 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183––
2,000,001 to 3,000,000 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181––
444
10. OTHER INCOME AND GAINS
Y ear ended
31 December 2021
One month ended
31 January 2021
One month ended
31 January 2022
RMB’000 RMB’000 RMB’000
(unaudited)
Gains on changes in fair value of derivative
financial instruments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820,946 9,239 –
Interest income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,090 175 62
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118276 105 33
22,312 9,519 95
11. OTHER EXPENSES
Y ear ended
31 December 2021
One month ended
31 January 2021
One month ended
31 January 2022
RMB’000 RMB’000 RMB’000
(unaudited)
Foreign exchange losses, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,777 819 1,534
Other /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118635 10 13,819
4,412 829 15,353
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-34 –


--- page 798 ---
12. FINANCE COSTS
An analysis of finance costs is as follows:
Y ear ended
31 December 2021
One month ended
31 January 2021
One month ended
31 January 2022
RMB’000 RMB’000 RMB’000
(unaudited)
Interest on loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111836,784 5,663 3,255
Interest on metal streaming arrangement /H1118/H1118/H1118/H1118/H1118/H111816,662 1,412 1,313
Accretion of interest of provisions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118509 27 125
Interest on lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,464 852 827
64,419 7,954 5,520
13. PROFIT/(LOSS) BEFORE TAX
The Group’s profit/loss before tax is arrived at after charging/(crediting):
Notes
Y ear ended
31 December 2021
One month ended
31 January 2021
One month ended
31 January 2022
RMB’000 RMB’000 RMB’000
(unaudited)
Cost of raw materials and consumables /H1118 271,534 25,974 24,018
Depreciation and amortisation /H1118/H1118/H1118/H1118/H1118/H1118 200,286 17,857 12,899
Foreign exchange losses, net /H1118/H1118/H1118/H1118/H1118/H1118/H111811 3,777 819 1,534
Gains on changes of derivative
financial instruments of fair value /H1118/H111810 (20,946) (9,239) –
Employee benefit expense /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118228,779 19,467 19,914
Expense relating to short-term leases
and leases with low-value assets /H1118/H1118/H111818 1,519 127 141
Share based compensation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111822,871 1,920 14,403
14. INCOME TAX EXPENSES
The Group is subject to income tax on an entity basis on the profits arising in or derived from the tax
jurisdictions in which the Group’s subsidiaries are domiciled and operate.
List of main corporate income tax rates applicable to the Group’s subsidiaries:
Name Countries and regions Rates
Golden Star (Wassa) Limited /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Ghana 35%
Golden Star Resources (UK) Ltd. /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118The United Kingdom 19%
Golden Star Exploration (Ghana) Limited /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Ghana 35%
Caystar Holdings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Cayman 0%
Caystar Finance Co. /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Cayman 0%
Caystar Management Holdings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Cayman 0%
Wasford Holdings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Cayman 0%
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-35 –


--- page 799 ---
An analysis of the Group’s provision for tax is as follows:
Y ear ended
31 December 2021
One month ended
31 January 2021
One month ended
31 January 2022
RMB’000 RMB’000 RMB’000
(unaudited)
Current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118185,597 14,753 6,910
Deferred /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820 38,660 3,722 (64,064)
Total tax charge /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118224,257 18,475 (57,154)
A reconciliation of the tax expense applicable to profit/(loss) before tax at the statutory rates for jurisdictions
in which the Company is domiciled to the tax expense at the effective tax rates, and a reconciliation of the applicable
rates (i.e., the statutory tax rates) to the effective tax rates, are as follows:
Y ear ended
31 December 2021
One month ended
31 January 2021
One month ended
31 January 2022
RMB’000 RMB’000 RMB’000
(unaudited)
Profit/(loss) before tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118118,717 36,266 (410,577)
Tax expense calculated at the statutory tax rate
of 35% /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111841,551 12,693 (143,702)
Effect of different tax rates of subsidiaries /H1118/H1118/H1118/H1118/H1118130,392 3,853 20,930
Non-deductible expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811,513 346 9,509
Unrecognised deductible temporary differences
and tax losses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111840,801 1,583 56,109
Tax charge at the effective rate /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118224,257 18,475 (57,154)
15. DIVIDENDS
No dividend has been declared or paid by the Company during the Relevant Periods.
16. EARNINGS/(LOSS) PER SHARE ATTRIBUTABLE TO ORDINARY EQUITY HOLDERS OF THE
PARENT
Earnings/(loss) per share information is not presented as its inclusion, for the purpose of this report, is not
considered meaningful.
17. PROPERTY, PLANT AND EQUIPMENT
Buildings Machinery
Mobile
equipment
Electronic
Equipment
and others
Mineral
assets
Construction
in progress Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Cost
At 1 January 2021 /H1118/H1118/H111874,531 586,380 426,296 1,275 1,917,162 24,043 3,029,687
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–––– 4,196 325,600 329,796
Transfers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111816,365 34,273 4,522 – 271,149 (326,309) –
Exchange differences /H1118/H1118(1,896) (13,811) (9,801) (29) (47,074) (541) (73,152)
At 31 December 2021 /H1118 89,000 606,842 421,017 1,246 2,145,433 22,793 3,286,331
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––––– 25,975 25,975
Exchange differences /H1118/H1118 (15) (105) (73) – (370) 61 (502)
At 31 January 2022 /H1118/H111888,985 606,737 420,944 1,246 2,145,063 48,829 3,311,804
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-36 –


--- page 800 ---
Buildings Machinery
Mobile
equipment
Electronic
Equipment
and others
Mineral
assets
Construction
in progress Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Accumulated
depreciation
At 1 January 2021 /H1118/H1118/H111851,257 470,000 326,440 267 861,667 – 1,709,631
Charge for the period /H1118/H1118 2,949 56,826 32,050 269 84,004 – 176,098
Exchange differences /H1118/H1118(1,207) (11,415) (7,841) (9) (20,690) – (41,162)
At 31 December 2021 /H1118 52,999 515,411 350,649 527 924,981 – 1,844,567
Charge for the period /H1118/H1118 286 4,075 2,262 22 4,586 – 11,231
Exchange differences /H1118/H1118 (9) (79) (55) – (148) – (291)
At 31 January 2022 /H1118/H111853,276 519,407 352,856 549 929,419 – 1,855,507
Net book value
At 1 January 2021 /H1118/H1118/H111823,274 116,380 99,856 1,008 1,055,495 24,043 1,320,056
At 31 December 2021 /H1118 36,001 91,431 70,368 719 1,220,452 22,793 1,441,764
At 31 January 2022 /H1118/H111835,709 87,330 68,088 697 1,215,644 48,829 1,456,297
18. LEASES
The Group has lease contracts for various items of buildings and machinery and vehicles.
(a) Right-of-use assets
The carrying amounts of the Group’s right-of-use assets and the movements are as follows:
Buildings
Machinery and
Vehicles Total
RMB’000 RMB’000 RMB’000
Y ear ended 31 December 2021
Cost at 1 January 2021, net of accumulated
depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,960 286 2,246
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 215,786 215,786
Depreciation provided during the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118(85) (21,720) (21,805)
Exchange differences /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(201) (2,092) (2,293)
At 31 December 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,674 192,260 193,934
At 31 December 2021
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,442 213,604 217,046
Accumulated depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,768) (21,344) (23,112)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,674 192,260 193,934
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-37 –


--- page 801 ---
Buildings
Machinery and
Vehicles Total
RMB’000 RMB’000 RMB’000
Y ear ended 31 January 2022
Cost at 1 January 2022, net of accumulated
depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,674 192,260 193,934
Depreciation provided during the period /H1118/H1118/H1118/H1118/H1118/H1118(18) (1,428) (1,446)
Exchange differences /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(435) (26) (461)
At 31 January 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,221 190,806 192,027
At 31 January 2022
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,442 213,604 217,046
Accumulated depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(2,221) (22,798) (25,019)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,221 190,806 192,027
(b) Lease liabilities
The carrying amount of lease liabilities and the movements are as follows:
Y ear ended
31 December 2021
One month ended
31 January 2022
RMB’000 RMB’000
Carrying amount at 1 January /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,442 209,193
New leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118215,786 –
Accretion of interest recognised during the year/period /H1118/H1118/H1118/H1118/H1118 10,464 827
Payments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(24,124) (2,814)
Exchange differences /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(2,375) (70)
Carrying amount at end of the year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118209,193 207,136
Analysed into:
Current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820,361 20,291
Non-current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118188,832 186,845
The amounts recognised in profit or loss in relation to leases are as follows:
Y ear ended
31 December 2021
One month ended
31 January 2022
RMB’000 RMB’000
Interest on lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,464 827
Depreciation charge of right-of-use assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111821,805 1,446
Expense relating to short-term leases and leases with
low-value assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,519 141
The maturity analysis of lease liabilities is disclosed in note 39 to the Historical Financial Information.
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-38 –


--- page 802 ---
19. OTHER INTANGIBLE ASSETS
Exploration and
mining rights Others Total
RMB’000 RMB’000 RMB’000
Cost
At 1 January 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118706,890 – 706,890
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 816 816
Exchange differences /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(16,164) (10) (16,174)
At 31 December 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118690,726 806 691,532
Exchange differences /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(120) – (120)
At 31 January 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118690,606 806 691,412
Accumulated amortisation
At 1 January 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118675,850 – 675,850
Charge for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,357 26 2,383
Exchange differences /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(15,482) – (15,482)
At 31 December 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118662,725 26 662,751
Charge for the period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118209 13 222
Exchange differences /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(114) – (114)
At 31 January 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118662,820 39 662,859
Net book value
At 1 January 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111831,040 – 31,040
At 31 December 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111828,001 780 28,781
At 31 January 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111827,786 767 28,553
20. DEFERRED TAX
For presentation purposes, certain deferred tax assets and liabilities have been offset. The following is the
analysis of the deferred tax balances for financial reporting purposes:
31 December 2021 31 January 2022
RMB’000 RMB’000
Deferred tax assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 66,828
Deferred tax liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118236,487 239,044
Deferred tax assets have not been recognised in respect of the following items:
31 December 2021 31 January 2022
RMB’000 RMB’000
Deductible temporary differences /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118147,339 32,494
Deductible tax losses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,988,955 2,198,056
2,136,294 2,230,550
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-39 –


--- page 803 ---
The unrecognised income tax losses, which have fixed expiry dates, will expire in the following years:
31 December 2021 31 January 2022
RMB’000 RMB’000
31 December 2026 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111855,830 55,830
31 December 2027 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111884,665 84,665
31 December 2028 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111876,414 76,414
31 December 2029 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118115,868 115,868
31 December 2030 and beyond /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,656,178 1,865,279
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,988,955 2,198,056
The movement in deferred tax assets and liabilities during the year, without taking into consideration the
offsetting of balance within the same tax jurisdiction, is as follows:
Deferred tax assets
Environmental
rehabilitation
Deductible tax
losses Total
RMB’000 RMB’000 RMB’000
At 1 January 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111836,592 – 36,592
Charged to profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(5,043) – (5,043)
Exchange differences /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(837) – (837)
At 31 December 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111830,712 – 30,712
Credited to profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187,373 66,663 74,036
Exchange differences /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(5) 165 160
At 31 January 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111838,080 66,828 104,908
Deferred tax liabilities
Accelerated
depreciation of
property, plant and
equipment Total
RMB’000 RMB’000
At 1 January 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118239,505 239,505
Credited to profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111833,617 33,617
Exchange differences /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(5,923) (5,923)
At 31 December 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118267,199 267,199
Credited to profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,972 9,972
Exchange differences /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(47) (47)
At 31 January 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118277,124 277,124
21. OTHER NON-CURRENT ASSETS
31 December 2021 31 January 2022
RMB’000 RMB’000
Funds for land restoration and environmental rehabilitation
after mine closure /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814,762 14,759
14,762 14,759
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-40 –


--- page 804 ---
22. INVENTORIES
31 December 2021 31 January 2022
RMB’000 RMB’000
Raw materials /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118156,456 161,057
Work in progress /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819,832 34,436
Finished goods /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814,156 38
190,444 195,531
23. TRADE RECEIV ABLES
31 December 2021 31 January 2022
RMB’000 RMB’000
Trade receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,589 6,500
Impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––
1,589 6,500
An ageing analysis of the trade receivables as at the end of each of the Relevant Periods, based on the invoice
date, is as follows:
31 December 2021 31 January 2022
RMB’000 RMB’000
Less than 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,589 6,500
1,589 6,500
The Group applies the simplified approach in calculating ECLs for trade receivables. Trade receivables relating
to customers with known financial difficulties or significant doubt on collection are assessed individually for
impairment allowance. The remaining trade receivables are grouped and collectively assessed for impairment
allowance. Under the collective approach, an impairment analysis is performed at each reporting date using a
provision matrix to measure expected credit losses. The provision rates are based on ageing of bills for groupings of
various customer segments with similar loss patterns. The calculation reflects the probability-weighted outcome, the
time value of money and reasonable and supportable information that is available at the reporting date about past
events, current conditions and forecasts of future economic conditions.
24. PREPAYMENTS, OTHER RECEIV ABLES AND OTHER ASSETS
The Group
31 December 2021 31 January 2022
RMB’000 RMB’000
Prepayments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111846,852 54,712
Deposits and other receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111840,844 37,678
Less: impairment of other receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––
87,696 92,390
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-41 –


--- page 805 ---
The Company
31 December 2021 31 January 2022
RMB’000 RMB’000
Prepayments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,135 3,334
Deposits and other receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118152 152
Receivables due from subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,277,471 358,301
Less: impairment of other receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––
2,281,758 361,787
25. FINANCIAL ASSETS AT FAIR V ALUE THROUGH PROFIT OR LOSS
31 December 2021 31 January 2022
RMB’000 RMB’000
Listed equity investments, at fair value /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118158 158
158 158
26. CASH AND CASH EQUIV ALENTS
The Group
31 December 2021 31 January 2022
RMB’000 RMB’000
Cash and bank balances /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118224,335 70,007
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118224,335 70,007
Denominated in:
USD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118201,561 53,051
GBP /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 841
CAD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,175 16,115
GH₵ /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819,599 –
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118224,335 70,007
The Company
31 December 2021 31 January 2022
RMB’000 RMB’000
Cash and bank balances /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118124,813 16,146
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118124,813 16,146
Denominated in:
USD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118121,638 31
CAD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,175 16,115
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118124,813 16,146
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-42 –


--- page 806 ---
27. DERIV ATIVE FINANCIAL LIABILITIES
31 December 2021 31 January 2022
RMB’000 RMB’000
Non-hedge derivative contract liability:
Maturing within one year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118188 –
Maturing in more than one year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811,153 –
11,341 –
For the year ended 31 December 2021, in relation to these positions, the Company recognized an unrealized
gain of $0.6 million.
28. TRADE PAYABLES
Trade payables do not bear interest and are usually settled within 60 days.
31 December 2021 31 January 2022
RMB’000 RMB’000
Trade payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118146,316 172,763
146,316 172,763
An ageing analysis of trade and notes payables as at the end of each of the Relevant Periods is as follows:
31 December 2021 31 January 2022
RMB’000 RMB’000
Less than 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118146,316 172,763
146,316 172,763
29. CONTRACT LIABILITIES
31 December 2021 31 January 2022
RMB’000 RMB’000
Short-term advances received from customers
Metal Streaming Arrangement (Note) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111850,619 50,610
Long-term advances received from customers
Metal Streaming Arrangement (Note) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118591,866 590,143
642,485 640,753
Note: In May 2015, one subsidiary of GSR, Caystar Finance Co. entered into a gold purchase and sale
agreement (the “Metal Streaming Arrangement”) with RGLD Gold AG, in which GSR obtained
USD145,000,000 from RGLD Gold AG, in exchange, GSR is required to deliver 10.5% of future gold
production of its two subsidiaries at a cash purchase price of 20% of the spot gold price until 240,000
ounces of gold have been delivered (“Tier One”). Thereafter, 5.5% of the gold production will be
delivered at a cash purchase price of 30% of the spot gold price (“Tier Two”). As at December 31, 2021
and 31 January 2022, the Company had delivered a total of 136,040 ounces and 137,130 ounces of gold
to RGLD Gold AG since the inception of the Streaming Agreement.
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-43 –


--- page 807 ---
The changes of contract liabilities — Metal Streaming Arrangement from 1 January 2021 to 31 January 2022
are as follows:
Gold delivery
obligation
Balance as at 1 January 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118681,891
Revenue recognized from delivery of goods /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(44,236)
Financial expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111816,662
Exchange differences /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(11,832)
Balance as at 31 December 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118642,485
Including: Contract liabilities due within one year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111850,619
Contract liabilities more than one year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118591,866
Balance as at 1 January 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118642,485
Revenue recognized from delivery of goods /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(2,934)
Financial expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,313
Exchange differences /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(111)
Balance as at 31 January 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118640,753
Including: Contract liabilities due within one year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111850,610
Contract liabilities more than one year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118590,143
30. OTHER PAYABLES AND ACCRUALS
The Group
31 December 2021 31 January 2022
RMB’000 RMB’000
Payable to Chijin (note) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 598,185
Payables to contractors /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111876,940 65,864
Salaries, wages and benefits payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111831,230 229,603
Taxes other than income tax payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,552 9,698
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118269 148
117,991 903,498
Note: The Group had an outstanding balance due to Chijin International (Hong Kong) Limited (“Chijin”) of
RMB598,185,000 (31 December 2021: nil) as at 31 January 2022. This balance is unsecured,
interest-free and has no fix term of repayment.
The Company
31 December 2021 31 January 2022
RMB’000 RMB’000
Payables to contractors /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813,491 19,187
Salaries, wages and benefits payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,099 12
Payables due to subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111853,017 52,075
69,607 71,274
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-44 –


--- page 808 ---
31. LONG-TERM LOANS
The Group
31 December 2021 31 January 2022
Effective
interest rate Maturity
Effective
interest rate Maturity
(%) RMB’000 (%) RMB’000
Current portion of long-term
loans – unsecured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
4.5+USD LIBOR 2022 4,798 – – –
Long-term loans – unsecured /H1118/H11184.5+USD LIBOR 2024 529,656 – – –
534,454 –
The carrying amounts of borrowings are denominated in the following currencies:
31 December 2021 31 January 2022
RMB’000 RMB’000
USD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118534,454 –
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118534,454 –
31 December 2021 31 January 2022
RMB’000 RMB’000
Analysed into:
Long-term loans:
Within one year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,798 –
After 1 year but within 2 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118248,290 –
After 2 years but within 5 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118281,366 –
After 5 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118534,454 –
The Company
31 December 2021 31 January 2022
Effective
interest rate Maturity
Effective
interest rate Maturity
(%) RMB’000 (%) RMB’000
Current portion of long-term
loans – unsecured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
4.5+USD LIBOR 2022 4,798 – – –
Long-term loans – unsecured /H1118/H11184.5+USD LIBOR 2024 529,656 – – –
534,454 –
The carrying amounts of borrowings are denominated in the following currencies:
31 December 2021 31 January 2022
RMB’000 RMB’000
USD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118534,454 –
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118534,454 –
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-45 –


--- page 809 ---
31 December 2021 31 January 2022
RMB’000 RMB’000
Analysed into:
Long-term loans:
Within one year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,798 –
After 1 year but within 2 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118248,290 –
After 2 years but within 5 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118281,366 –
After 5 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118534,454 –
32. PROVISIONS
Pursuant to the regulations of the governmental authorities in the places where the mines are located, the Group
recognises provision for environmental rehabilitation and restoration of mines. The amount of provision is an
estimate based upon the life of mining tenements, timing of mine closure and cost of such rehabilitation. The
management will update the estimation basis annually.
The movement in the present value of the provision for rehabilitation are as follows:
31 December 2021 31 January 2022
RMB’000 RMB’000
Beginning balance /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118114,630 109,145
Accretion of interest recognized during the year/period /H1118/H1118/H1118/H1118/H1118 509 125
Payment during the year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(7,602) (451)
Effect on recalculation of the model /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,196 –
Exchange differences /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(2,588) (19)
Ending balance /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118109,145 108,800
Current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,797 6,796
Non-current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118102,348 102,004
33. SHARE CAPITAL
31 December 2021 31 January 2022
RMB’000 RMB’000
Issued and fully paid: /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,906,459 6,906,459
6,906,459 6,906,459
A summary of movements in the Company’s share capital is as follows:
Number of shares
in issue Share capital
RMB’000
At 1 January 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118111,313,595 6,810,170
Issue of shares /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,220,213 89,356
Share-base payment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118289,477 6,933
At 31 December 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118115,823,285 6,906,459
At 31 January 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118115,823,285 6,906,459
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-46 –


--- page 810 ---
On 28 October, 2020, the Company entered into a $50 million “at-the-market” sales agreement. The use of
proceeds from the “at-the-market” sales agreement is for discretionary growth capital at Wassa, exploration, general
corporate purposes and working capital.
During the year ended 31 December, 2021, 4,220,213 new shares were issued under the “at-the-market” sales
agreement. The net proceeds from shares issued under the “at-the-market” sales agreement of RMB92,656,912 for
the period ended 31 December, 2021 is net of share issuance costs of RMB3,300,618.
During the year 2021, the number of share options exercised by was 98,238, the number of restricted shares
under the deferred share units plan was 20,660, the number of performance and restricted shares under the 2017
Performance and restricted share units plan was nil, and the number of performance shares under the UK performance
share units plan was 170,579. After deducting the tax impact, the Company’s common share capital increased by
289,478 shares, and the common share capital increased by RMB6,932,598.
34. SHARE-BASED COMPENSATION
The Company operates Stock options, Deferred share units, Share appreciation rights, 2017 Performance and
restricted share units and UK performance share units. Share-based compensation expenses recognized in the
consolidated statements of profit or loss are as follows:
Y ear ended
31 December 2021
One month ended
31 January 2021
One month ended
31 January 2022
RMB’000 RMB’000 RMB’000
(unaudited)
Share-based compensation expense /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111822,871 1,920 14,403
Following Chifeng Jilong Gold Mining Co. Ltd.’s acquisition of the Company on January 28, 2022, all
Deferred share units, 2017 Performance and restricted share units, UK performance share units were deemed
unconditionally vested and cancelled by Golden Star in consideration for a cash payment equal to USD3.91 per unit.
In addition, each in-the-money stock option and Share appreciation rights was cancelled by Golden Star in
consideration for a cash payment equal to the excess of USD3.91 and the exercise price per stock option/unit.
35. NOTES TO THE CONSOLIDATED STATEMENTS OF CASH FLOWS
(a) Changes in liabilities arising from financing activities
Long-term loans Lease liabilities Total
RMB’000 RMB’000 RMB’000
As at 1 January 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118680,430 9,442 689,872
Changes from financing cash flows /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(143,630) (24,124) (167,754)
Cash paid for interest expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(42,580) – (42,580)
Interest expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825,407 10,464 35,871
New leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 215,786 215,786
Exchange differences /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814,827 (2,375) 12,452
As at 31 December 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118534,454 209,193 743,647
Long-term loans Lease liabilities Total
RMB’000 RMB’000 RMB’000
As at 1 January 2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118680,430 9,442 689,872
Changes from financing cash flows /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118- (2,435) (2,435)
Interest expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,241 900 5,141
New leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 216,698 216,698
Exchange differences /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(7,476) (62) (7,538)
As at 31 January 2021 (unaudited) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118677,195 224,543 901,738
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-47 –


--- page 811 ---
Long-term loans Lease liabilities Payable to Chijin Total
RMB’000 RMB’000 RMB’000 RMB’000
As at 1 January 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118534,454 209,193 – 743,647
Changes from financing cash flows /H1118 (529,646) (2,814) 598,185 65,725
Cash paid for interest expenses /H1118/H1118/H1118/H1118(4,782) – – (4,782)
Interest expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,255 827 – 4,082
Exchange differences /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(3,281) (70) – (3,351)
As at 31 January 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 207,136 598,185 805,321
36. COMMITMENTS AND CONTINGENCIES
The Group had the following capital commitments at the end of each of the Relevant Periods:
31 December 2021 31 January 2022
RMB’000 RMB’000
Contracted, but not provided for:
Property, plant and equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111831,241 46,072
Investment commitment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111822,315 29,951
53,556 76,023
37. RELATED PARTY TRANSACTIONS
There were no material related party transactions for the period ended 31 December, 2021 other than the items
disclosed below.
Concurrent with the Chifeng Jilong Gold Mining Co., Ltd. acquisition of the Golden Star on January 28, 2022,
Chijin International (HK) Limited advanced to Golden Star USD93.8 million which was used for the full repayment
of the outstanding principal on the Revolving Credit Facility (“RCF”) of USD90 million, accrued interest of USD0.1
million and termination of the hedging program of USD3.7 million.
(a) Compensation of key management personnel
Y ear ended
31 December 2021
One month ended
31 January 2022
RMB’000 RMB’000
Salaries, wages, bonuses and other benefits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,453 817
Share based compensation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,782 46,945
14,235 47,762
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-48 –


--- page 812 ---
38. FINANCIAL INSTRUMENTS BY CATEGORY
The carrying amounts of each of the categories of financial instruments as at the end of each of the Relevant
Periods are as follows:
31 December 2021
Financial assets
Financial assets at
amortised cost
Financial assets at
fair value Total
RMB’000 RMB’000 RMB’000
Trade receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,589 – 1,589
Financial assets included in prepayments, other
receivables and other assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111827,053 – 27,053
Financial assets at fair value through profit or
loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 158 158
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118224,335 – 224,335
Other non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814,762 – 14,762
267,739 158 267,897
Financial liabilities
Financial liabilities
at amortised cost
Financial liabilities
at fair value Total
RMB’000 RMB’000 RMB’000
Trade payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118146,316 – 146,316
Current portion of derivative financial liabilities /H1118 – 188 188
Derivative financial liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 11,153 11,153
Long-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118529,656 – 529,656
Other payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111876,940 – 76,940
Current portion of long-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,798 – 4,798
757,710 11,341 769,051
31 January 2022
Financial assets
Financial assets at
amortised cost
Financial assets at
fair value Total
RMB’000 RMB’000 RMB’000
Trade receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,500 – 6,500
Financial assets included in prepayments, other
receivables and other assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818,934 – 18,934
Financial assets at fair value through profit or
loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 158 158
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111870,007 – 70,007
Other non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814,759 – 14,759
110,200 158 110,358
Financial liabilities
Financial liabilities
at amortised cost
Financial liabilities
at fair value Total
RMB’000 RMB’000 RMB’000
Trade payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118172,763 – 172,763
Financial liabilities included in other payables
and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118882,710 – 882,710
1,055,473 – 1,055,473
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-49 –


--- page 813 ---
39. FAIR V ALUE AND FAIR V ALUE HIERARCHY OF FINANCIAL INSTRUMENTS
Management has assessed that the fair values of cash and cash equivalents, trade receivables, trade payables,
other payables and accruals, other non-current liabilities due within one year and financial assets included in
prepayments, other receivables and other assets approximate to their carrying amounts largely due to the short-term
maturities of these instruments.
The fair values of other non-current assets, long-term loans, lease liabilities and other non-current liabilities
were determined by discounting the expected future cash flows using market rates of return currently available for
other financial instruments with similar terms, credit risk and remaining maturities or incremental borrowing rate.
The Group’s own non-performance risk for long-term loans was assessed to be insignificant. The fair values of listed
equity investments are based on quoted market prices.
The Group’s finance department headed by the finance manager is responsible for determining the policies and
procedures for the fair value measurement of financial instruments. The finance manager reports directly to the chief
financial officer and the audit committee. At the end of each of the Relevant Periods, the finance department analyses
the movements in the values of financial instruments and determines the major inputs applied in the valuation. The
valuation is reviewed and approved by the chief financial officer.
Fair value hierarchy
The following tables illustrate the fair value measurement hierarchy of the Group’s financial instruments:
Assets measured at fair value:
As at 31 December 2021 Fair value measurement using
Quoted prices in
active markets
(Level 1)
Significant
observable inputs
(Level 2)
Significant
unobservable
inputs
(Level 3) Total
RMB’000 RMB’000 RMB’000 RMB’000
Financial assets at fair value through
profit or loss
Including: Equity investment /H1118/H1118/H1118/H1118 158 – – 158
158 – – 158
As at 31 January 2022 Fair value measurement using
Quoted prices in
active markets
(Level 1)
Significant
observable inputs
(Level 2)
Significant
unobservable
inputs
(Level 3) Total
RMB’000 RMB’000 RMB’000 RMB’000
Financial assets at fair value through
profit or loss
Including: Equity investment /H1118/H1118/H1118/H1118 158 – – 158
158 – – 158
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-50 –


--- page 814 ---
Liabilities measured at fair value:
As at 31 December 2021 Fair value measurement using
Quoted prices in
active markets
(Level 1)
Significant
observable inputs
(Level 2)
Significant
unobservable
inputs
(Level 3) Total
RMB’000 RMB’000 RMB’000 RMB’000
Derivative financial liabilities
Non-hedge derivative contract
liability /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 11,341 – 11,341
– 11,341 – 11,341
As at 31 January 2022 Fair value measurement using
Quoted prices in
active markets
(Level 1)
Significant
observable inputs
(Level 2)
Significant
unobservable
inputs
(Level 3) Total
RMB’000 RMB’000 RMB’000 RMB’000
Derivative financial liabilities
Non-hedge derivative contract
liability /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––––
––––
During the year ended 31 December 2021 and one month ended 31 January 2022, there were no transfers
between Level 1 and Level 2, or transfers into or out of Level 3 for both financial assets and financial liabilities. The
Group’s policy is to recognise transfers between levels of the fair value hierarchy as at the end of each of the Relevant
Periods in which they occur.
40. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Group is exposed to various risks in relation to financial instruments in its daily operations, mainly, credit
risk, liquidity risk and market risk (including interest rate risk, exchange rate risk, and commodity price risk). The
Group’s major financial instruments include cash and cash equivalents, financial assets at fair value through profit
or loss, derivative financial assets, trade receivables, other non-current assets, long-term loans, financial liabilities
at fair value through profit or loss, trade payables, other payables and accruals, etc. The Group also carries out
derivatives transactions, mainly involving commodity futures contracts, aiming at managing the market risks of the
Group’s operation. The Group manages the market risks of derivatives based on the difference between metal price
in the market and the target metal price pre-determined by the management. Risks in connection with such financial
instruments, and the risk management strategies adopted by the Group to mitigate such risks are summarized as
follows.
Interest rate risk
The Group’s exposure to the risk of changes in market interest rates relates primarily to the Group’s long term
debt obligations with a floating interest rate.
Interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes
in market interest rates. As at 31 December 2021, the RCF with Macquarie Bank Limited incurs interest at 4.5% plus
the applicable USD LIBOR rate per annum. Based on our current RMB529,656,000 outstanding balance, a 50 basis
point change in the USD LIBOR rate would result in a change in interest expense of RMB2,869,000. As at 31 January
2022, there’s no floating rate loan balances left. We have not entered into any agreements to hedge against
unfavorable changes in interest rates but may do so in the future to actively manage our exposure to interest rate risk.
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-51 –


--- page 815 ---
Foreign currency risk
The Group’s primary operations are located in Ghana, with its main business transactions settled in US dollars.
The foreign currency risks associated with the Group’s identified foreign currency assets and liabilities, as well as
future foreign currency transactions (where the pricing currencies for foreign currency assets, liabilities, and
transactions are primarily Ghanaian cedis), are minimal.
The Group continuously monitors the scale of its foreign currency transactions, assets, and liabilities to
minimize the foreign currency risks it faces.
Credit risk
Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by
failing to discharge an obligation. The Group’s credit risk is primarily associated with liquid financial assets and
derivatives.
The Group limits exposure to credit risk on liquid financial assets by holding our cash, cash equivalents,
restricted cash and deposits at highly-rated financial institutions. In addition, the Group continuously monitors the
balance of trade receivables to ensure that the Group is not exposed to significant bad debt risks. Risks associated
with gold trade receivables is considered minimal as the Group sells gold to a credit-worthy buyers via an agent who
settles promptly within two days of receipt of gold bullion.
Other financial assets of the Group include receivables and some derivatives. The credit risk on these financial
assets arises from the default of counterparties, with a maximum exposure equal to the carrying amounts of these
instruments.
Liquidity risk
The Group monitors its risk to a shortage of funds using a recurring liquidity planning tool. This tool considers
both the maturity of its financial instruments and financial assets (e.g., trade receivables) and projected cash flows
from operations.
The Group’s objective is to maintain a balance between continuity of funding and flexibility through the use
of loans and bank borrowings.
The maturity profile of the Group’s financial liabilities as at the end of each of the Relevant Periods, based
on the contractual undiscounted payments, is as follows:
As at 31 December 2021
Within 1 year 1 to 5 years Over 5 years Total
RMB’000 RMB’000 RMB’000 RMB’000
Derivative financial liabilities /H1118/H1118/H1118/H1118/H1118188 11,153 – 11,341
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111829,891 143,775 82,629 256,295
Long-term loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111824,151 603,345 – 627,496
Trade payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118146,316 – – 146,316
Financial liabilities included in other
payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111876,940 – – 76,940
277,486 758,273 82,629 1,118,388
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-52 –


--- page 816 ---
As at 31 January 2022
Within 1 year 1 to 5 years Over 5 years Total
RMB’000 RMB’000 RMB’000 RMB’000
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111829,271 142,003 80,320 251,594
Trade and notes payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118172,763 – – 172,763
Financial liabilities included in other
payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118882,710 – – 882,710
1,084,744 142,003 80,320 1,307,067
Capital management
The primary objective of the Group’s capital management is to ensure that it maintains strong credit rating and
healthy capital ratios in order to support its business and maximise shareholders’ value.
The Group regards total equity as its capital and manages its capital structure and makes adjustments to it, in
light of changes in economic conditions. To maintain or adjust the capital structure, the Group may adjust the
dividend payment to shareholders, return capital to shareholders or issue new shares. No changes were made in the
objectives, policies and processes during the Relevant Periods.
During the Relevant Periods, the Group’s strategy was to maintain the gearing ratio at a healthy level in order
to monitor capital. The principal strategies adopted by the Group include, but are not limited to, reviewing future cash
flow requirements and the ability to meet debt repayment schedules when they fall due, maintaining a reasonable
level of available banking facilities and adjusting investment plans and financing plans, if necessary, to ensure that
the Group has a reasonable level of capital to support its business. Gearing ratio is total liabilities divided by total
assets.
The gearing ratios at the end of each of the Relevant Periods were as follows:
31 December 2021 31 January 2022
RMB’000 RMB’000
Total assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,183,463 2,123,050
Total liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,012,997 2,282,581
Gearing ratio /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111892% 108%
41. INVESTMENTS IN SUBSIDIARIES
The Company
31 December 2021 31 January 2022
RMB’000 RMB’000
Investments, at cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,931,161 3,225,985
Less: impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(543,226) (543,133)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,387,935 2,682,852
Particulars of the subsidiaries, which are directly owned by the Company, are included in note 1 to the
Historical Financial Information.
42. SUBSEQUENT FINANCIAL STATEMENTS
No audited financial statements have been prepared by the Group in respect of any period subsequent to
31 January 2022.
APPENDIX IB HISTORICAL FINANCIAL INFORMATION
OF GOLDEN STAR RESOURCES
– IB-53 –


--- page 817 ---
The information set out in this appendix does not form part of the Accountants’ Report
from Ernst & Y oung, Certified Public Accountants, Hong Kong, the reporting accountants of
the Company, as set out in Appendix IA to this listing document, and is included herein for
information only. The unaudited pro forma financial information should be read in conjunction
with the section headed “Financial Information” and the “Accountants’ Report” set out in
Appendix IA to this Prospectus.
A. UNAUDITED PRO FORMA STATEMENT OF ADJUSTED CONSOLIDATED NET
TANGIBLE ASSETS
The following unaudited pro forma statement of adjusted consolidated net tangible assets
of our Group prepared in accordance with Rule 4.29 of the Listing Rules and with reference
to Accounting Guideline (“AG”) 7 Preparation of Pro Forma Financial Information for
Inclusion in Investment Circulars issued by the HKICPA is set out below to illustrate the effect
of the Global Offering on the consolidated net tangible assets of our Group attributable to
owners of the Company as at 30 September 2024 as if it had taken place on 30 September 2024.
This unaudited pro forma statement of adjusted consolidated net tangible assets has been
prepared for illustrative purposes only and because of its hypothetical nature, it may not give
a true picture of the consolidated net tangible assets of our Group as at 30 September 2024 or
at any future dates following the Global Offering. It is prepared based on the consolidated net
tangible assets of our Group as at 30 September 2024 as set out in the Accountants’ Report of
our Group, the text of which is set out in Appendix IA to this Prospectus, and adjusted as
described below. The unaudited pro forma statement of adjusted consolidated net tangible
assets does not form part of the Accountants’ Report.
Consolidated net
tangible assets
attributable to
owners of the
Company as at
30 September
2024 (1)
Estimated net
proceeds from
the Global
Offering (2)
Unaudited pro
forma adjusted
consolidated net
tangible assets
attributable to
owners of the
Company
Unaudited pro forma
adjusted consolidated net
tangible assets per
Share (3)(4)(5)
RMB’000 RMB’000 RMB’000 RMB HK$
Based on the Offer Price of
HK$13.72 per Offer Share /H1118/H1118/H1118/H1118 1,032,075 2,467,840 3,499,915 1.87 2.03
Based on the Offer Price of
HK$15.83 per Offer Share /H1118/H1118/H1118/H1118 1,032,075 2,855,925 3,888,000 2.08 2.26
Notes:
(1) The consolidated net tangible assets attributable to owners of the Company as at 30 September 2024 is
extracted from the Accountants’ Report set out in Appendix IA to this Prospectus, which is based on the
consolidated net assets of our Group attributable to owners of the Company as at 30 September 2024 of
approximately RMB7,116 million with an adjustment for the other intangible assets of RMB6,042 million and
goodwill of RMB42 million.
APPENDIX IIA UNAUDITED PRO FORMA FINANCIAL INFORMATION
– IIA-1 –


--- page 818 ---
(2) The estimated net proceeds from the Global Offering are based on the Offer Price of HK$13.72 per Offer Share
or HK$15.83 per Offer Share, being the low-end price or high-end price, after deduction of the estimated
underwriting fees and other related expenses payable by the Company and takes no account of any Share which
may be issued upon the exercise of the Over-allotment Option. The estimated net proceeds from the Global
Offering are converted from Hong Kong dollars into RMB at an exchange rate of HK$1.00 to RMB0.9221.
(3) The unaudited pro forma adjusted consolidated net tangible assets per Share has been arrived at by dividing
the unaudited pro forma adjusted consolidated net tangible assets attributable to owners of the Company by
1,869,563,378 Shares. The 1,869,563,378 Shares is calculated on the basis of a total of 205,652,000 Shares
were in issue assuming that Global Offering has been completed as at 30 September 2024, excluding Shares
which may be issued upon the exercise of the Over-allotment Options.
The Shares used in the calculation include the 15,182,600 Treasury Shares, as the Company is in the opinion
of that these 15,182,600 shares have been granted to eligible participants of Phase III Employee Stock
Ownership Plan in February 2025, and which will be vested and exercised with highly possibility. If excluding
the 15,182,600 Treasury Shares, the unaudited pro forma adjusted consolidated net tangible assets attributable
to owners of the Company per Share as at 30 September 2024, which is divided by 1,854,380,778 Shares,
would then be adjusted to RMB1.89 (HKD2.05) or RMB2.10 (HKD2.28) based on the Offer Price of
HKD13.72 per Share or HKD15.83 per Share, respectively.
(4) The unaudited pro forma adjusted consolidated net tangible assets of the Group attributable to owners of the
Company per Share is converted from RMB into Hong Kong dollars at the rate of HK$1.00 to RMB0.9221.
No representation is made that RMB amounts have been, could have been or could be converted to Hong Kong
dollars, or vice versa at that rate or at any other rates or at all.
(5) Except as disclosed above, no adjustment has been made to reflect any trading results or other transactions
entered into by our Group subsequent to 30 September 2024.
APPENDIX IIA UNAUDITED PRO FORMA FINANCIAL INFORMATION
– IIA-2 –


--- page 819 ---
The following is the text of a report received from the independent reporting
accountants, Ernst & Young, Certified Public Accountants, Hong Kong, prepared for the
purpose of incorporation in this prospectus.
⭰㰟㛪姯⸒Ṳ⋀㈧
榀㸖毩歁㵳勘䙮怺979噆
⤑⏋✱ᷧ⺎27㧺
Tel 曢婘: +852 2846 9888
Fax ₚ䜆: +852 2868 4432
ey.com
Ernst & Young
27/F, One Taikoo Place
979 King’s Road
Quarry Bay, Hon
g Kong
B. INDEPENDENT REPORTING ACCOUNTANTS’ ASSURANCE REPORT ON THE
COMPILATION OF PRO FORMA FINANCIAL INFORMATION
To the Directors of Chifeng Jilong Gold Mining Co., Ltd.
We have completed our assurance engagement to report on the compilation of pro forma
financial information of Chifeng Jilong Gold Mining Co., Ltd. (the “Company”) and its
subsidiaries (hereinafter collectively referred to as the “Group”) by the directors of the
Company (the “Directors”) for illustrative purposes only. The pro forma financial information
consists of the pro forma consolidated net tangible assets as at 30 September 2024, and related
notes as set out on pages IIA-1 to IIA-2 of the Prospectus dated 28 February 2025 issued by
the Company (the “Pro Forma Financial Information”). The applicable criteria on the basis of
which the Directors have compiled the Pro Forma Financial Information are described in
Appendix IIA to the Prospectus.
The Pro Forma Financial Information has been compiled by the Directors to illustrate the
impact of the global offering of shares of the Company on the Group’s financial position as at
30 September 2024 as if the transaction had taken place at 30 September 2024. As part of this
process, information about the Group’s financial position, has been extracted by the Directors
from the Group’s financial statements for the nine months ended 30 September 2024, on which
an accountants’ report has been published.
Directors’ responsibility for the Pro Forma Financial Information
The Directors are responsible for compiling the Pro Forma Financial Information in
accordance with paragraph 4.29 of the Rules Governing the Listing of Securities on The Stock
Exchange of Hong Kong Limited (the “Listing Rules”) and with reference to Accounting
Guideline (“AG”) 7 Preparation of Pro Forma Financial Information for Inclusion in
Investment Circulars issued by the Hong Kong Institute of Certified Public Accountants (the
“HKICPA”).
APPENDIX IIA UNAUDITED PRO FORMA FINANCIAL INFORMATION
– IIA-3 –


--- page 820 ---
Our independence and quality control
We have complied with the independence and other ethical requirements of the Code of
Ethics for Professional Accountants issued by the HKICPA, which is founded on fundamental
principles of integrity, objectivity, professional competence and due care, confidentiality and
professional behavior.
Our firm applies Hong Kong Standard on Quality Management 1 Quality Management for
Firms that Perform Audits or Reviews of Financial Statements, or Other Assurance or Related
Services Engagements which requires the firm to design, implement and operate a system of
quality management including policies or procedures regarding compliance with ethical
requirements, professional standards and applicable legal and regulatory requirements.
Reporting accountants’ responsibilities
Our responsibility is to express an opinion, as required by paragraph 4.29(7) of the
Listing Rules, on the Pro Forma Financial Information and to report our opinion to you. We do
not accept any responsibility for any reports previously given by us on any financial
information used in the compilation of the Pro Forma Financial Information beyond that owed
to those to whom those reports were addressed by us at the dates of their issue.
We conducted our engagement in accordance with Hong Kong Standard on Assurance
Engagements 3420 Assurance Engagements to Report on the Compilation of Pro Forma
Financial Information Included in a Prospectus issued by the HKICPA. This standard requires
that the reporting accountants plan and perform procedures to obtain reasonable assurance
about whether the Directors have compiled the Pro Forma Financial Information in accordance
with paragraph 4.29 of the Listing Rules and with reference to AG 7 issued by the HKICPA.
For purposes of this engagement, we are not responsible for updating or reissuing any
reports or opinions on any historical financial information used in compiling the Pro Forma
Financial Information, nor have we, in the course of this engagement, performed an audit or
review of the financial information used in compiling the Pro Forma Financial Information.
The purpose of the Pro Forma Financial Information included in the Prospectus is solely
to illustrate the impact of the global offering of shares of the Company on unadjusted financial
information of the Group as if the transaction had been undertaken at an earlier date selected
for purposes of the illustration. Accordingly, we do not provide any assurance that the actual
outcome of the transaction would have been as presented.
APPENDIX IIA UNAUDITED PRO FORMA FINANCIAL INFORMATION
– IIA-4 –


--- page 821 ---
A reasonable assurance engagement to report on whether the Pro Forma Financial
Information has been properly compiled on the basis of the applicable criteria involves
performing procedures to assess whether the applicable criteria used by the Directors in the
compilation of the Pro Forma Financial Information provide a reasonable basis for presenting
the significant effects directly attributable to the transaction, and to obtain sufficient
appropriate evidence about whether:
 the related pro forma adjustments give appropriate effect to those criteria; and
 the Pro Forma Financial Information reflects the proper application of those
adjustments to the unadjusted financial information.
The procedures selected depend on the reporting accountants’ judgment, having regard to
the reporting accountants’ understanding of the nature of the Group, the transaction in respect
of which the Pro Forma Financial Information has been compiled, and other relevant
engagement circumstances.
The engagement also involves evaluating the overall presentation of the Pro Forma
Financial Information.
We believe that the evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.
Opinion
In our opinion:
(a) the Pro Forma Financial Information has been properly compiled on the basis stated;
(b) such basis is consistent with the accounting policies of the Group; and
(c) the adjustments are appropriate for the purpose of the Pro Forma Financial
Information as disclosed pursuant to paragraph 4.29(1) of the Listing Rules.
Ernst & Y oung
Certified Public Accountants
Hong Kong
28 February 2025
APPENDIX IIA UNAUDITED PRO FORMA FINANCIAL INFORMATION
– IIA-5 –


--- page 822 ---
(A) PROFIT ESTIMATE FOR THE YEAR ENDED DECEMBER 31, 2024
I. Bases
Our Directors have prepared the estimate of the consolidated profit attributable to owners
of the Company for the year ended December 31, 2024 (the “ Profit Estimate ”) based on the
audited consolidated results of our Group for the nine months ended September 30, 2024 and
the unaudited consolidated results of our Group for the three months ended December 31, 2024.
The Profit Estimate has been prepared on the basis of the accounting policies consistent in all
material aspects with those currently adopted by our Group as set out in the Accountant’s
Report, the text of which is set out in Appendix IA to this prospectus.
II. Profit estimate for the year ended December 31, 2024
On the basis set out in Appendix IIB to this prospectus, and in the absence of unforeseen
circumstances, we estimate that our consolidated profit attributable to owners of our Company
for the year ended December 31, 2024 are as follows:
Estimated consolidated profit attributable
to owners of our Company for the year
ended December 31, 2024
Not less than RMB1,730.0 million
(equivalent to approximately HK$1,879.4
million)
APPENDIX IIB PROFIT ESTIMATE
– IIB-1 –


--- page 823 ---
The following is the text of a report received from the independent reporting
accountants, Ernst & Young, Certified Public Accountants, Hong Kong, prepared for the
purpose of incorporation in this prospectus.
(B) LETTER FROM THE REPORTING ACCOUNTANT
⭰㰟㛪姯⸒Ṳ⋀㈧
榀㸖毩歁㵳勘䙮怺979噆
⤑⏋✱ᷧ⺎27㧺
Tel 曢婘: +852 2846 9888
Fax ₚ䜆: +852 2868 4432
ey.com
Ernst & Young
27/F, One Taikoo Place
979 King’s Road
Quarry Bay, Hon
g Kong
28 February 2025
The Board of Directors
Chifeng Jilong Gold Mining Co., Ltd.
CITIC Securities (Hong Kong) Limited
Dear Sirs,
Chifeng Jilong Gold Mining Co., Ltd. (“the Company”)
Profit estimate for year ended 31 December 2024
We refer to the estimate of the consolidated profit attributable to equity holders of the
Company for the year ended 31 December 2024 (“the Profit Estimate”) set forth in the section
headed “Financial Information” in the prospectus of the Company dated 28 February 2025
(“the Prospectus”).
Directors’ responsibilities
The Profit Estimate has been prepared by the directors of the Company based on the
audited consolidated results of the Company and its subsidiaries (collectively referred to as
“the Group”) for the nine months ended 30 September 2024, the unaudited consolidated results
based on the management accounts of the Group for the remaining three months ended
31 December 2024.
The Company’s directors are solely responsible for the Profit Estimate.
APPENDIX IIB PROFIT ESTIMATE
– IIB-2 –


--- page 824 ---
Our independence and quality management
We have complied with the independence and other ethical requirements of the Code of
Ethics for Professional Accountants issued by the Hong Kong Institute of Certified Public
Accountants (“HKICPA”), which is founded on fundamental principles of integrity, objectivity,
professional competence and due care, confidentiality and professional behavior.
Our firm applies Hong Kong Standard on Quality Management 1 Quality Management for
Firms that Perform Audits or Reviews of Financial Statements, or Other Assurance or Related
Services Engagements , which requires the firm to design, implement and operate a system of
quality control including policies or procedures regarding compliance with ethical
requirements, professional standards and applicable legal and regulatory requirements.
Reporting accountants’ responsibilities
Our responsibility is to express an opinion on the accounting policies and calculations of
the Profit Estimate based on our procedures.
We conducted our engagement in accordance with Hong Kong Standard on Investment
Circular Reporting Engagements 500 Reporting on Profit Forecasts, Statements of Sufficiency
of Working Capital and Statements of Indebtedness and with reference to Hong Kong Standard
on Assurance Engagements 3000 (Revised) Assurance Engagements Other Than Audits or
Reviews of Historical Financial Information issued by the HKICPA. Those standards require
that we plan and perform our work to obtain reasonable assurance as to whether, so far as the
accounting policies and calculations are concerned, the Company’s directors have properly
compiled the Profit Estimate in accordance with the bases adopted by the directors and as to
whether the Profit Estimate is presented on a basis consistent in all material respects with the
accounting policies normally adopted by the Group. Our work is substantially less in scope
than an audit conducted in accordance with Hong Kong Standards on Auditing issued by the
HKICPA. Accordingly, we do not express an audit opinion.
Opinion
In our opinion, so far as the accounting policies and calculations are concerned, the Profit
Estimate has been properly compiled in accordance with the bases adopted by the directors as
set out in Appendix IIB of the Prospectus and is presented on a basis consistent in all material
respects with the accounting policies normally adopted by the Group as set out in our
accountants’ report dated 28 February 2025, the text of which is set out in Appendix IA of the
Prospectus.
Y ours faithfully,
Ernst & Y oung
Certified Public Accountants
Hong Kong
APPENDIX IIB PROFIT ESTIMATE
– IIB-3 –


--- page 825 ---
(C) LETTER FROM THE SPONSOR
The following is the text of a letter , prepared for the inclusion in this prospectus, received
from CITIC Securities (Hong Kong) Limited, the Sponsor , in relation to our Group’ s profit
estimate for the year ended December 31, 2024.
CITIC Securities (Hong Kong) Limited
18/F, One Pacific Place
88 Queensway
Hong Kong
February 28, 2025
The Directors
Chifeng Jilong Gold Mining Co., Ltd.
Dear Sirs,
We refer to the estimate of consolidated profit attributable to owners of Chifeng Jilong
Gold Mining Co., Ltd. (the “ Company ”) and its subsidiaries (collectively referred to as the
“Group ”) for the year ended December 31, 2024 (the “ Profit Estimate ”), for which the
directors of the Company (the “ Directors ”) are solely responsible, as set out in the section
headed “Financial Information — Profit estimate for the year ended December 31, 2024” in the
prospectus of the Company dated February 28, 2025 (the “ Prospectus ”).
The Profit Estimate has been prepared by the Directors based on the audited consolidated
results of the Group for the nine months ended September 30, 2024 and the unaudited
consolidated results based on the management accounts of the Group for the three months
ended December 31, 2024.
We have reviewed and discussed with the Directors the bases made by the Directors as
set out in Appendix IIB to the Prospectus, upon which the Profit Estimate has been made. We
have also considered and relied upon the letter dated February 28, 2025 addressed to the
Directors and ourselves from the Company’s reporting accountant, Ernst & Y oung, regarding
the accounting policies and calculations upon which the Profit Estimate has been made.
On the basis of the information comprising the Profit Estimate and on the basis of the
accounting policies and calculations adopted by the Directors and reviewed by Ernst & Y oung,
we are of the opinion that the Profit Estimate, for which the Directors are solely responsible,
has been made after due and careful enquiry.
For and on behalf of
CITIC Securities (Hong Kong) Limited
APPENDIX IIB PROFIT ESTIMATE
– IIB-4 –


--- page 826 ---
Cover Page
Final
Competent Person's Report on the Gold
and Lead-Zinc Projects in the People's
Republic of China
Gold and Lead-Zinc Projects, Chifeng, Dandong and Yanbian, Inner
Mongolia, Liaoning, Jilin and Yunnan Provinces, P.R. China,

Chifeng Jilong Gold Mining Co., Ltd.



SRK Consulting China Ltd.  SCN849A  28 February 2025

– IIIA-1 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 827 ---
Final

Competent Person’s Report on the Gold and Lead-Zinc Projects in the
People’s Republic of China
Gold and Lead-Zinc Projects, Chifeng, Dandong, Yanbian and Inne r Mongolia, Liaoning, Jilin and
Yunnan Provinces, P. R. China

Prepared for:
Chifeng Jilong Gold Mining Co., Ltd.
No.7 Xiaojingjia, Wanfeng Road
Fengtai District,  Beijing , China
10000


Prepared by:
SRK Consulting China Ltd.
B1301 COFCO Plaza, No. 8 Jianguomen Inner Street
Dongcheng District, Beijing, China
100005

+86 10 6511 1000
www.srk.com


Lead Author:  Yiefei Jia (Principal Consultant): Initials: YJ

Reviewer:  Yonglian Sun (Corporate Consultant) Initials: YS



Cover Image(s):
A picture showing the Jinlong Project layout

Copyright © 2025
SRK Consulting China Ltd.     SCN849A     28 February 2025


Inside Cover Page
– IIIA-2 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 828 ---
Acknowledgments
SRK would like to acknowledge the support and collaboration pro vided by Chifeng Jilong Gold Mining Co., Ltd.
personnel for this assignment. T heir collaboration was greatly appreciated and instrumental to the success of this
project

Disclaimer and Notices

SRK Consulting China Ltd. has prepared this document for Chifeng Jilong Gold Mining Co., Ltd., our client. Any use or decisions
by which a third party makes of this document are the responsib ility of such third parties. In  no circumstance does SRK accept
any consequential liability arising from commercial decisions or actions resulting from the use of this report by a third party.
The opinions expressed in this document have been based on the information available to SRK at the time of preparation. SRK
has exercised all due care in reviewing information supplied by  others for use on this project. While SRK has compared key
supplied data with expected values, the accuracy of the results and conclusions from the review are entirely reliant on the accuracy
and completeness of the supplied data. SRK does not accept responsibility for any errors or omissions in the supplied information,
except to the extent that SRK was hired to verify the data.
– IIIA-3 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 829 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Contents    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS i
Contents
Useful Definitions ...................................................................................................................................................... xvii
Executive Summary ................................................................................................................................................... xxi
Introduction ................................................................................................................................................................ xxi
Outline of Work Program ........................................................................................................................................... xxi
Results ...................................................................................................................................................................... xxii
Overall     ........................................................................................................................................................ xxii
Operational Licenses and Permits ................................................................................................................ xxvi
Geology and Exploration ............................................................................................................................... xxvi
Mineral Resources Estimation ...................................................................................................................... xxxiv
Ore Reserves Estimation ............................................................................................................................ xxxviii
Mining Assessment ........................................................................................................................................... xl
Metallurgical and Processing Assessment ..................................................................................................... xliv
Capital Expenditures and Operating Expenses. ........................................................................................... xlviii
Economic Analysis ............................................................................................................................................ lii
Environmental approvals and status ................................................................................................................ liii
Risk Assessment ............................................................................................................................................... lv
Recommendations ........................................................................................................................................... lviii
1 Introduction ......................................................................................................................................................... 1
2 Program Objectives and Work Program ............................................................................................................. 2
2.1 Purpose of the Report ........................................................................................................................................ 2
2.2 Reporting Standard ............................................................................................................................................ 2
2.3 Limitations Statement ......................................................................................................................................... 2
2.4 Effective Date ..................................................................................................................................................... 2
2.5 Work Program .................................................................................................................................................... 3
2.6 SRK Experience ................................................................................................................................................. 3
2.7 Project Team ...................................................................................................................................................... 5
2.8 Warranties .......................................................................................................................................................... 8
2.9 Compliance Statement ....................................................................................................................................... 8
2.10 Independence Statement ................................................................................................................................... 9
2.11 Consent .............................................................................................................................................................. 9
2.12 Forward Looking Statement ............................................................................................................................... 9
3 Property Description and Location ................................................................................................................... 10
3.1 Property Location ............................................................................................................................................. 10
3.1.1 Jilong Project ..................................................................................................................................... 11
3.1.2 Huatai Project .................................................................................................................................... 11
3.1.3 Wulong Project .................................................................................................................................. 11
3.1.4 Hanfeng Project ................................................................................................................................ 11
3.1.5 Jintai Project ...................................................................................................................................... 11
3.2 Mineral Tenure ................................................................................................................................................. 11
3.2.1 Jilong Project ..................................................................................................................................... 12
3.2.2 Huatai Project .................................................................................................................................... 12
3.2.3 Wulong Project .................................................................................................................................. 14
3.2.4 Hanfeng Project ................................................................................................................................ 15
3.2.5 Jintai Project ...................................................................................................................................... 15
3.3 Underlying Agreements .................................................................................................................................... 16
3.4 Permits and Authorization ................................................................................................................................ 17
– IIIA-4 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 830 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Contents    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS ii
3.5 Environmental Considerations ......................................................................................................................... 17
4 Accessibility, Climate, Local Resources, Infrastructure, and Physiography .................................................... 18
4.1 Accessibility ...................................................................................................................................................... 18
4.1.1 Jilong and Huatai Projects ................................................................................................................ 18
4.1.2 Wulong Project .................................................................................................................................. 18
4.1.3 Hanfeng Project ................................................................................................................................ 18
4.1.4 Jintai Project ...................................................................................................................................... 18
4.2 Local Resources and Infrastructure ................................................................................................................. 19
4.2.1 Jilong and Huatai Projects ................................................................................................................ 19
4.2.2 Wulong Project .................................................................................................................................. 19
4.2.3 Hanfeng Project ................................................................................................................................ 19
4.2.4 Jintai Project ...................................................................................................................................... 19
4.3 Climate Physiography ....................................................................................................................................... 20
4.3.1 Jilong and Huatai Projects ................................................................................................................ 20
4.3.2 Wulong Project .................................................................................................................................. 20
4.3.3 Hanfeng Project ................................................................................................................................ 21
4.3.4 Jintai Project ...................................................................................................................................... 21
5 Geological Setting and Mineralisation .............................................................................................................. 23
5.1 Regional Geology ............................................................................................................................................. 23
5.1.1 Jilong and Huatai Projects ................................................................................................................ 23
5.1.2 Wulong Project .................................................................................................................................. 23
5.1.3 Hanfeng Project ................................................................................................................................ 24
5.1.4 Jintai Project ...................................................................................................................................... 25
5.2 Property Geology .............................................................................................................................................. 27
5.2.1 Jilong Project ..................................................................................................................................... 27
5.2.2 Huatai Project .................................................................................................................................... 28
5.2.3 Wulong Project .................................................................................................................................. 30
5.2.4 Hanfeng Project ................................................................................................................................ 33
5.2.5 Jintai Project ...................................................................................................................................... 35
5.3 Characteristics of Mineralised Bodies .............................................................................................................. 37
5.3.1 Jilong Project ..................................................................................................................................... 37
5.3.2 Huatai Project .................................................................................................................................... 38
5.3.3 Wulong Project .................................................................................................................................. 40
5.3.4 Hanfeng Project ................................................................................................................................ 43
5.3.5 Jintai Project ...................................................................................................................................... 45
6 Exploration, Sampling, Analytical Procedures and Quality Assurance and Quality Control ............................ 48
6.1 Exploration ........................................................................................................................................................ 48
6.1.1 Jilong Project ..................................................................................................................................... 48
6.1.2 Huatai Project .................................................................................................................................... 49
6.1.3 Wulong Project .................................................................................................................................. 51
6.1.4 Hanfeng Project ................................................................................................................................ 52
6.1.5 Jintai Project ...................................................................................................................................... 54
6.2 Drilling and Trenching ....................................................................................................................................... 55
6.2.1 Jilong Project ..................................................................................................................................... 55
6.2.2 Huatai Project .................................................................................................................................... 56
6.2.3 Wulong Project .................................................................................................................................. 59
6.2.4 Hanfeng Project ................................................................................................................................ 61
6.2.5 Jintai Project ...................................................................................................................................... 62
6.2.6 SRK Comments ................................................................................................................................ 63
– IIIA-5 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 831 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Contents    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS iii
6.3 Sampling, Sample Preparation, Analysis and Quality Control ......................................................................... 63
6.3.1 Jilong Project ..................................................................................................................................... 63
6.3.2 Huatai Project .................................................................................................................................... 65
6.3.3 Wulong Project .................................................................................................................................. 67
6.3.4 Hanfeng Project ................................................................................................................................ 70
6.3.5 Jintai Project ...................................................................................................................................... 77
6.3.6 SRK Comments ................................................................................................................................ 81
7 SRK Data Verification ....................................................................................................................................... 82
7.1 Introduction ....................................................................................................................................................... 82
7.2 Jilong Project .................................................................................................................................................... 82
7.3 Huatai Project ................................................................................................................................................... 83
7.4 Wulong Project ................................................................................................................................................. 85
7.5 Hanfeng Project ................................................................................................................................................ 85
7.6 Jintai Project ..................................................................................................................................................... 87
7.7 SRK Comments ................................................................................................................................................ 88
8 Mineral Resource Estimates............................................................................................................................. 89
8.1 Introduction ....................................................................................................................................................... 89
8.2 Mineral Resource Estimation Procedures ........................................................................................................ 89
8.3 Mineral Resource Database ............................................................................................................................. 89
8.3.1 Jilong Project ..................................................................................................................................... 89
8.3.2 Huatai Project .................................................................................................................................... 90
8.3.3 Wulong Project .................................................................................................................................. 91
8.3.4 Hanfeng Project ................................................................................................................................ 91
8.3.5 Jintai Project ...................................................................................................................................... 92
8.4 Solid Body Modelling ........................................................................................................................................ 93
8.4.1 Jilong Project ..................................................................................................................................... 93
8.4.2 Huatai Project .................................................................................................................................... 93
8.4.3 Wulong Project .................................................................................................................................. 94
8.4.4 Hanfeng Project ................................................................................................................................ 95
8.4.5 Jintai Project ...................................................................................................................................... 96
8.5 Compositing ...................................................................................................................................................... 96
8.5.1 Jilong Project ..................................................................................................................................... 96
8.5.2 Huatai Project .................................................................................................................................... 97
8.5.3 Wulong Project .................................................................................................................................. 98
8.5.4 Hanfeng Project .............................................................................................................................. 100
8.5.5 Jintai Project .................................................................................................................................... 101
8.6 Evaluation of Outliers ..................................................................................................................................... 102
8.6.1 Jilong Project ................................................................................................................................... 103
8.6.2 Huatai Project .................................................................................................................................. 103
8.6.3 Wulong Project ................................................................................................................................ 105
8.6.4 Hanfeng Project .............................................................................................................................. 106
8.6.5 Jintai Project .................................................................................................................................... 107
8.7 Block Model and Grade Estimation ................................................................................................................ 110
8.7.1 Jilong Project ................................................................................................................................... 110
8.7.2 Huatai Project .................................................................................................................................. 112
8.7.3 Wulong Project ................................................................................................................................ 113
8.7.4 Hanfeng Project .............................................................................................................................. 116
8.7.5 Jintai Project .................................................................................................................................... 117
8.8 Model Validation and Sensitivity ..................................................................................................................... 119
8.8.1 Jilong Project ................................................................................................................................... 119
– IIIA-6 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 832 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Contents    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS iv
8.8.2 Huatai Project .................................................................................................................................. 121
8.8.3 Wulong Project ................................................................................................................................ 123
8.8.4 Hanfeng Project .............................................................................................................................. 125
8.8.5 Jintai Project .................................................................................................................................... 126
8.9 Mineral Resource Classification ..................................................................................................................... 126
8.9.1 Jilong Project ................................................................................................................................... 127
8.9.2 Huatai Project .................................................................................................................................. 127
8.9.3 Wulong Project ................................................................................................................................ 128
8.9.4 Hanfeng Project .............................................................................................................................. 129
8.9.5 Jintai Project .................................................................................................................................... 130
8.10 Mineral Resource Statement .......................................................................................................................... 131
8.10.1 Jilong Project ................................................................................................................................... 131
8.10.2 Huatai Project .................................................................................................................................. 132
8.10.3 Wulong Project ................................................................................................................................ 133
8.10.4 Hanfeng Project .............................................................................................................................. 134
8.10.5 Jintai Project .................................................................................................................................... 135
8.11 Grade Sensitivity Analysis .............................................................................................................................. 136
8.11.1 Jilong Project ................................................................................................................................... 136
8.11.2 Huatai Project .................................................................................................................................. 138
8.11.3 Wulong Project ................................................................................................................................ 140
8.11.4 Hanfeng Project .............................................................................................................................. 142
8.11.5 Jintai Project .................................................................................................................................... 143
9 Ore Reserve Estimates .................................................................................................................................. 145
9.1 Jilong Project .................................................................................................................................................. 146
9.1.1 Introduction ..................................................................................................................................... 146
9.1.2 Mineral Resources Model ............................................................................................................... 147
9.1.3 Feasibility Study .............................................................................................................................. 147
9.1.4 Cut-off Grade .................................................................................................................................. 147
9.1.5 Mining Dilution and Ore Loss .......................................................................................................... 148
9.1.6 Ore Reserve Estimates ................................................................................................................... 148
9.1.7 Ore Reserve statement ................................................................................................................... 149
9.2 Huatai Project ................................................................................................................................................. 150
9.2.1 Introduction ..................................................................................................................................... 150
9.2.2 Ore Resources Models ................................................................................................................... 151
9.2.3 Feasibility Study .............................................................................................................................. 151
9.2.4 Cut-off Grade .................................................................................................................................. 152
9.2.5 Mining Dilution and Ore Loss .......................................................................................................... 152
9.2.6 Ore Reserve Estimates ................................................................................................................... 153
9.2.7 Ore Reserves Statement ................................................................................................................. 154
9.3 Wulong Project ............................................................................................................................................... 155
9.3.1 Introduction ..................................................................................................................................... 155
9.3.2 Mineral Resources Models.............................................................................................................. 156
9.3.3 Feasibility Study .............................................................................................................................. 156
9.3.4 Cut-off Grade .................................................................................................................................. 156
9.3.5 Mining Dilution and Ore Loss .......................................................................................................... 157
9.3.6 Ore Reserve Estimates ................................................................................................................... 157
9.3.7 Ore Reserve Statement .................................................................................................................. 159
9.4 Hanfeng Project .............................................................................................................................................. 159
9.4.1 Introduction ..................................................................................................................................... 159
9.4.2 Mineral Resources Models.............................................................................................................. 160
9.4.3 Feasibility Study .............................................................................................................................. 160
– IIIA-7 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 833 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Contents    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS v
9.4.4 Cut-off Grade .................................................................................................................................. 160
9.4.5 Mining Dilution and Ore Loss .......................................................................................................... 161
9.4.6 Ore Reserve Estimates ................................................................................................................... 161
9.4.7 Ore Reserve statement ................................................................................................................... 163
9.5 Jintai Project ................................................................................................................................................... 164
9.5.1 Introduction ..................................................................................................................................... 164
9.5.2 Mineral Resources Models.............................................................................................................. 164
9.5.3 Feasibility Study .............................................................................................................................. 164
9.5.4 Cut-off Grade .................................................................................................................................. 164
9.5.5 Modifying Factors ............................................................................................................................ 165
9.5.6 Ore Reserve Estimates ................................................................................................................... 165
9.5.7 Ore Reserve Statement .................................................................................................................. 166
10 Mining Assessment ........................................................................................................................................ 168
10.1 Jilong Project .................................................................................................................................................. 168
10.1.1 Introduction ..................................................................................................................................... 168
10.1.2 Geotechnical and Hydrogeological Conditions ............................................................................... 168
10.1.3 Mining Method ................................................................................................................................. 168
10.1.4 Production ....................................................................................................................................... 170
10.1.5 Underground Service ...................................................................................................................... 172
10.1.6 Mining Equipment ........................................................................................................................... 173
10.1.7 Production Schedule ....................................................................................................................... 174
10.2 Huatai Project ................................................................................................................................................. 176
10.2.1 Introduction ..................................................................................................................................... 176
10.2.2 Geotechnical and Hydrogeological Conditions ............................................................................... 176
10.2.3 Mining Method ................................................................................................................................. 177
10.2.4 Production ....................................................................................................................................... 177
10.2.5 Underground Service ...................................................................................................................... 179
10.2.6 Mining Equipment ........................................................................................................................... 179
10.2.7 Production Schedule ....................................................................................................................... 181
10.3 Wulong Project ............................................................................................................................................... 184
10.3.1 Introduction ..................................................................................................................................... 184
10.3.2 Geotechnical and Hydrogeological Conditions ............................................................................... 184
10.3.3 Mining Method ................................................................................................................................. 185
10.3.4 Production ....................................................................................................................................... 186
10.3.5 Underground Service ...................................................................................................................... 189
10.3.6 Mining Equipment ........................................................................................................................... 190
10.3.7 Production Schedule ....................................................................................................................... 190
10.4 Hanfeng Project .............................................................................................................................................. 192
10.4.1 Introduction ..................................................................................................................................... 192
10.4.2 Geotechnical & Hydrogeological Conditions ................................................................................... 193
10.4.3 Mining Method ................................................................................................................................. 194
10.4.4 Production ....................................................................................................................................... 194
10.4.5 Underground Service ...................................................................................................................... 197
10.4.6 Mining Equipment ........................................................................................................................... 198
10.4.7 Production Schedule ....................................................................................................................... 199
10.5 Jintai Project ................................................................................................................................................... 200
10.5.1 Introduction ..................................................................................................................................... 200
10.5.2 Geotechnical & Hydrogeological Conditions ................................................................................... 200
10.5.3 Mine Method ................................................................................................................................... 202
10.5.4 Mine Design .................................................................................................................................... 204
10.5.5 Production ....................................................................................................................................... 206
– IIIA-8 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS vi
10.5.6 Mine Service ................................................................................................................................... 206
10.5.7 Mining Equipment ........................................................................................................................... 207
10.5.8 Production Schedule ....................................................................................................................... 207
11 Processing and Metallurgical Assessment ..................................................................................................... 212
11.1 Jilong Project .................................................................................................................................................. 212
11.1.1 Processing and Metallurgical Testwork .......................................................................................... 212
11.1.2 Production Status of Processing Plant ............................................................................................ 212
11.1.3 Tailing Storage Facility .................................................................................................................... 218
11.1.4 Conclusions and Recommendations .............................................................................................. 219
11.2 Huatai Project ................................................................................................................................................. 219
11.2.1 Processing and Metallurgical Testwork .......................................................................................... 219
11.2.2 Production Status of Huatai Processing Plant ................................................................................ 220
11.2.3 Tailings Storage Facility .................................................................................................................. 224
11.2.4 Conclusions and Recommendations .............................................................................................. 225
11.3 Wulong Project ............................................................................................................................................... 225
11.3.1 Processing and Metallurgical Testwork .......................................................................................... 225
11.3.2 Production Status of Wulong Processing Plant .............................................................................. 226
11.3.3 Tailings Storage Facilities ............................................................................................................... 230
11.3.4 Conclusions and Recommendations .............................................................................................. 231
11.4 Hanfeng Project .............................................................................................................................................. 232
11.4.1 Processing and Metallurgical Testwork .......................................................................................... 232
11.4.2 Production Flowsheet ...................................................................................................................... 233
11.4.3 Mineral Processing Facilities and Equipment ................................................................................. 234
11.4.4 Historical Production Index ............................................................................................................. 237
11.4.5 Tailings Storage Facility .................................................................................................................. 238
11.4.6 Conclusion and Recommendations ................................................................................................ 239
11.5 Jintai Project ................................................................................................................................................... 240
11.5.1 Metallurgical Testwork .................................................................................................................... 240
11.5.2 Jintai Heap Leaching Plant ............................................................................................................. 241
11.5.3 Heap Leaching Process .................................................................................................................. 241
11.5.4 The Facilities and equipment of Heap Leaching Plant ................................................................... 245
11.5.5 Designed technical index and production performance .................................................................. 246
11.5.6 Conclusion and Recommendation .................................................................................................. 248
12 Project Infrastructure ...................................................................................................................................... 250
12.1 Location and Access ...................................................................................................................................... 250
12.1.1 Jilong Project ................................................................................................................................... 250
12.1.2 Huatai Project .................................................................................................................................. 250
12.1.3 Wulong Project ................................................................................................................................ 250
12.1.4 Hanfeng Project .............................................................................................................................. 250
12.1.5 Jintai Project .................................................................................................................................... 250
12.2 Power Supply ................................................................................................................................................. 251
12.2.1 Jilong Project ................................................................................................................................... 251
12.2.2 Huatai Project .................................................................................................................................. 251
12.2.3 Wulong Project ................................................................................................................................ 251
12.2.4 Hanfeng Project .............................................................................................................................. 251
12.2.5 Jintai Project .................................................................................................................................... 251
12.3 Water Supply .................................................................................................................................................. 252
12.3.1 Jilong Project ................................................................................................................................... 252
12.3.2 Huatai Project .................................................................................................................................. 252
12.3.3 Wulong Project ................................................................................................................................ 252
– IIIA-9 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 835 ---
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12.3.4 Hanfeng Project .............................................................................................................................. 252
12.3.5 Jintai Project .................................................................................................................................... 253
13 Environmental Studies, Permitting, and Social or Community Impact ........................................................... 254
13.1 Environmental, Permitting, and Social or Community Review Objective ....................................................... 254
13.2 Environmental, Permitting, and Social or Community Review Process, Scope, and Standards ................... 254
13.3 Status of Environmental Impact Assessment ................................................................................................. 254
13.3.1 Jilong Project ................................................................................................................................... 255
13.3.2 Huatai Project .................................................................................................................................. 255
13.3.3 Wulong Project ................................................................................................................................ 256
13.3.4 Hanfeng Project .............................................................................................................................. 256
13.3.5 Jintai Project .................................................................................................................................... 256
13.4 Status of Environmental Licenses and Permits .............................................................................................. 257
13.4.1 Safety Production Permit ................................................................................................................ 257
13.4.2 Water Use Permit ............................................................................................................................ 260
13.4.3 Site Discharge Permit ..................................................................................................................... 261
13.5 Environmental Study and Management ......................................................................................................... 262
13.5.1 Jilong Project ................................................................................................................................... 262
13.5.2 Huatai Project .................................................................................................................................. 263
13.5.3 Wulong Project ................................................................................................................................ 264
13.5.4 Hanfeng Project .............................................................................................................................. 265
13.5.5 Jintai Project .................................................................................................................................... 266
13.6 Occupational Health and Safety ..................................................................................................................... 267
13.7 Site Closure Planning and Rehabilitation ....................................................................................................... 268
13.7.1 Chifeng Jilong ................................................................................................................................. 268
13.7.2 Chifeng Huatai ................................................................................................................................ 268
13.7.3 Liaoning Wulong ............................................................................................................................. 269
13.7.4 Jilin Hanfeng ................................................................................................................................... 269
13.7.5 Yunnan Jintai .................................................................................................................................. 269
13.8 Social Aspects ................................................................................................................................................ 270
13.8.1 Jilong Project ................................................................................................................................... 270
13.8.2 Huatai Project .................................................................................................................................. 270
13.8.3 Wulong Project ................................................................................................................................ 270
13.8.4 Hanfeng Project .............................................................................................................................. 271
13.8.5 Jintai Project .................................................................................................................................... 271
14 Capital and Operating Costs .......................................................................................................................... 273
14.1 Jilong Project .................................................................................................................................................. 273
14.1.1 Capital Expenditures ....................................................................................................................... 273
14.1.2 Historical Operating Cost ................................................................................................................ 274
14.1.3 Forecasted Operating Cost ............................................................................................................. 275
14.2 Huatai Project ................................................................................................................................................. 276
14.2.1 Capital Expenditures ....................................................................................................................... 276
14.2.2 Historical Operating Cost ................................................................................................................ 277
14.2.3 Forecasted Operating Cost ............................................................................................................. 278
14.3 Wulong Project ............................................................................................................................................... 279
14.3.1 Capital Expenditures ....................................................................................................................... 279
14.3.2 Historical Operating Cost ................................................................................................................ 279
14.3.3 Forecasted Operating Cost ............................................................................................................. 280
14.4 Hanfeng Project .............................................................................................................................................. 280
14.4.1 Capital Expenditures ....................................................................................................................... 280
14.4.2 Historical Operating Cost ................................................................................................................ 281
– IIIA-10 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 836 ---
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Contents    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS viii
14.4.3 Forecasted Operating Cost ............................................................................................................. 282
14.5 Jintai Project ................................................................................................................................................... 282
14.5.1 Capital Expenditures ....................................................................................................................... 282
14.5.2 Historical Operating Cost ................................................................................................................ 283
14.5.3 Forecasted Operating Cost ............................................................................................................. 283
15 Economic Analysis ......................................................................................................................................... 285
15.1 Historical Price ................................................................................................................................................ 285
15.2 Price Forecast ................................................................................................................................................ 285
15.3 Jilong Project .................................................................................................................................................. 286
15.3.1 Principal Assumptions ..................................................................................................................... 286
15.3.2 Financial Net Present Value ........................................................................................................... 288
15.3.3 Sensitivity Analysis .......................................................................................................................... 290
15.4 Huatai Project ................................................................................................................................................. 291
15.4.1 Principal Assumptions ..................................................................................................................... 291
15.4.2 Financial Net Present Value ........................................................................................................... 293
15.4.3 Sensitivity Analysis .......................................................................................................................... 294
15.5 Wulong Project ............................................................................................................................................... 295
15.5.1 Principal Assumptions ..................................................................................................................... 295
15.5.2 Financial Net Present Value ........................................................................................................... 298
15.5.3 Sensitivity Analysis .......................................................................................................................... 299
15.6 Hanfeng Project .............................................................................................................................................. 300
15.6.1 Principal Assumptions ..................................................................................................................... 300
15.6.2 Financial Net Present Value ........................................................................................................... 303
15.6.3 Sensitivity Analysis .......................................................................................................................... 304
15.7 Jintai Project ................................................................................................................................................... 305
15.7.1 Principal Assumptions ..................................................................................................................... 305
15.7.2 Financial Net Present Value ........................................................................................................... 308
15.7.3 Sensitivity Analysis .......................................................................................................................... 309
16 Risk Assessment ............................................................................................................................................ 311
17 Conclusions and Recommendations .............................................................................................................. 316
17.1 Jilong Project .................................................................................................................................................. 316
17.2 Huatai Project ................................................................................................................................................. 317
17.3 Wulong Project ............................................................................................................................................... 317
17.4 Hanfeng Project .............................................................................................................................................. 318
17.5 Jintai Project ................................................................................................................................................... 318
18 References ..................................................................................................................................................... 319

– IIIA-11 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 837 ---
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Contents    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS ix
Tables
Table 2-1: SRK’s Reports for Listing on the HKEx .................................................................................................... 4
Table 2-2: SRK Project Team .................................................................................................................................... 5
Table 3-1: Information of Mining Licenses, Jilong Mining ....................................................................................... 12
Table 3-2: Information of Exploration Tenements, Jilong Mining ............................................................................ 12
Table 3-3: Information of Mining Licenses, Huatai Mining ...................................................................................... 12
Table 3-4: Information of Mining License, Wulong Mining ...................................................................................... 14
Table 3-5: Information of Exploration Tenement, Wulong Mining ........................................................................... 14
Table 3-6: Information of Mining Licenses, Hanfeng Mining ................................................................................... 15
Table 3-7: Information of Exploration Tenement, Hanfeng Mining .......................................................................... 15
Table 3-8: Information of Mining License, Jintai Mining .......................................................................................... 16
Table 3-9: Information of Exploration Tenement, Jintai Mining ............................................................................... 16
Table 6-1: Completed Exploration Workload at Zhuanshanzi Mine ........................................................................ 49
Table 6-2: Completed Exploration workload at Honghuagou and Lianhuashan Mines .......................................... 50
Table 6-3: Completed Exploration Workload at Lishan Mine (below -92m asl) ...................................................... 53
Table 6-4: Completed Exploration Workload at Dongfeng Mine (below 250m asl) ................................................ 53
Table 6-5: Completed Exploration Workload in the Mining Licence Area ............................................................... 54
Table 6-6: Completed Exploration Workload in the Exploration Permit Area ......................................................... 55
Table 6-7: Summary Characteristics of Trenching, Drilling and Tunnelling ............................................................ 59
Table 6-8: Drilling and Tunnelling Summary of Hanfeng Project ............................................................................ 62
Table 6-9: A Summary of Characteristics of Trenching and Drilling ....................................................................... 62
Table 6-10: Results of Specific Gravity Measurement for Huatai Project ................................................................. 66
Table 6-11: Summary of Wulong QA/QC data .......................................................................................................... 69
Table 6-12: Summary of Haojingou-Ligunzi QC data ............................................................................................... 70
Table 6-13: QA/QC Data Summary of Lishan Mine from 2010 to 2011 .................................................................... 72
Table 6-14: QA/QC Data Summary of Lishan Mine (below -92m asl) from 2011 to 2020 ........................................ 73
Table 6-15: QC Data Summary of Dongfeng Deposit in 2011 .................................................................................. 75
Table 6-16: QA/QC Data Summary of Dongfeng Deposit from 2013 to 2023 .......................................................... 76
Table 6-17: Summary of General Exploration QA/QC data ...................................................................................... 79
Table 6-18: Summary of Resource Verification QA/QC data .................................................................................... 79
Table 6-19: Summary of Advanced Exploration QA/QC data ................................................................................... 80
Table 7-1: Summary of SRK Verification Samples .................................................................................................. 87
Table 8-1: Mineral Resource Database Statistics of Jilong Project ........................................................................ 90
Table 8-2: Mineral Resource Database Statistics of Huatai Project ....................................................................... 90
Table 8-3: Mineral Resource Database Statistics of Wulong Project ...................................................................... 91
Table 8-4: Resource Database Statistics of Hanfeng Project ................................................................................. 92
Table 8-5: Mineral Resource Database Statistics for Jintai Project ........................................................................ 92
Table 8-6: Composites Statistics of Zhuanshanzi Mine .......................................................................................... 97
Table 8-7: Composites Statistics of Huatai project .................................................................................................. 98
Table 8-8: Statistics of Sample Length of Each Deposit ......................................................................................... 98
Table 8-9: Summary Statistic of Composites against Raws of Each Deposit ......................................................... 99
Table 8-10: Composites Statistics of Lishan Mine (below-92m asl) ........................................................................ 100
Table 8-11: Composites Statistics of Dongfeng Mine (below 250m asl) .................................................................. 100
Table 8-12: Statistics of Sample Length of Xidengping Mine .................................................................................. 101
Table 8-13: Summary Statistic of Composites against Raws of Each Domain ....................................................... 102
Table 8-14: Capping Values Statistics of #1#2#3&depth Block of Zhuanshanzi Mine ........................................... 103
Table 8-15: Capping Values Statistics of Huatai Project ......................................................................................... 104
Table 8-16: Capping Values Statistics of Wulong Project ....................................................................................... 106
Table 8-17:  Outliers Treatment of Hanfeng Project ................................................................................................. 107
Table 8-18: Capping Values Statistics of Xidengping Mine .................................................................................... 110
– IIIA-12 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 838 ---
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Contents    Final
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Table 8-19: Block Model Specifications of #1#2#3&depth Block of Zhuanshanzi Mine ......................................... 110
Table 8-20: Search Parameters Used in #1#2#3&depth Block of Zhuanshanzi Mine ............................................ 110
Table 8-21: Search distance and Samples Used in #1#2#3&depth Block of Zhuanshanzi Mine ........................... 111
Table 8-22: Block Model Specifications of #4#5#6#7 Block of Zhuanshanzi Mine ................................................. 111
Table 8-23: Distance and Samples Used in #4#5#6#7 Block of Zhuanshanzi Mine .............................................. 111
Table 8-24: Block Model Specifications of Huatai Project ....................................................................................... 112
Table 8-25: Parameters Used in #1 and #5 Mining Zones, #86, #3&#7, #26 Veins, Pengjiagou ........................... 113
Table 8-26: Distance and Samples Used in Huatai project ..................................................................................... 113
Table 8-27: Block Model Specifications of Wulong Mine ........................................................................................ 113
Table 8-28: Attributes and Descriptions of Wulong Mine ........................................................................................ 113
Table 8-29: Search Parameters Used in Wulong Mine ........................................................................................... 114
Table 8-30: Distance and Samples Used in Wulong Mine ...................................................................................... 114
Table 8-31: Block Model Specifications of Ligunzi Deposit ..................................................................................... 114
Table 8-32: Attributes and Descriptions of Ligunzi Deposit .................................................................................... 115
Table 8-33: Search Parameters Used in Ligunzi Deposit ....................................................................................... 115
Table 8-34: Distance and Samples Used in Ligunzi Deposit .................................................................................. 115
Table 8-35: Block Model Specifications of Haojingou-Ligunzi Deposit ................................................................... 115
Table 8-36: Attributes and Descriptions of Haojingou-Ligunzi Deposit ................................................................... 116
Table 8-37: Search Parameters Used in Haojingou-Ligunzi Deposit ...................................................................... 116
Table 8-38: Distance and Samples Used in Haojingou-Ligunzi Deposit ................................................................. 116
Table 8-39: Block Model Parameters for Lishan and Dongfeng Mines .................................................................... 117
Table 8-40:  Specific Search Parameters for Hanfeng Project ................................................................................ 117
Table 8-41: Ellipsoid Parameters for Lishan Mine (below-92m asl) ......................................................................... 117
Table 8-42: Ellipsoid Parameters for Dongfeng Mine (below 250m asl) .................................................................. 117
Table 8-43: Block Model Specifications of Xidengping Mine .................................................................................. 118
Table 8-44: Attributes and Descriptions of Xidengping Mine .................................................................................. 118
Table 8-45: Search Parameters Used in Xidengping Mine ..................................................................................... 118
Table 8-46: Distance and Samples Used in Xidengping Mine ................................................................................ 118
Table 8-47: Conceptual Assumptions Considered for Chifeng Gold Project .......................................................... 131
Table 8-48: Mineral Resource Statement of Jilong Project, as of 30 September 2024 .......................................... 132
Table 8-49: Mineral Resource Statement of Huatai Project, as of 30 September 2024 ......................................... 132
Table 8-50: Mineral Resource Statement, Wulong Project, as of 30 September 2024 .......................................... 133
Table 8-51: Mineral Resource Statement of Lishan Mine, as of 30 September 2024 .............................................. 134
Table 8-52: Mineral Resource Statement of Dongfeng Mine, as of 30 September 2024 ......................................... 135
Table 8-53: Mineral Resource Statement, Jintai Project, as of 30 September 2024 ............................................... 135
Table 8-54: Global Block Model Quantities and Grade Estimates1, #1#2#3&depth Block of Zhuanshanzi Mine
 .............................................................................................................................................................. 137
Table 8-55: Global Block Model Quantities and Grade Estimates1, Huatai Project ................................................. 138
Table 8-56: Global Block Model Quantities and Grade Estimates1, Wulong Project ............................................... 140
Table 8-57: Block Model Quantities and Grade Estimates1, Hanfeng Project ......................................................... 142
Table 8-58: Global Block Model Quantities and Grade Estimates1, Xidengping Mine at Various Cut-off Grades
 .............................................................................................................................................................. 143
Table 9-1: Unit Cost of Jilong Project from 2021 to 2024Q3 ................................................................................. 147
Table 9-2: Cut-off Grade Calculation ..................................................................................................................... 147
Table 9-3: Estimated Process Summary ............................................................................................................... 148
Table 9-4: Jilong Project Underground Ore Reserve Statement, as of 30 September 2024 ................................ 150
Table 9-5: Unit Cost of Huatai Project from 2021 to 2024 Q3 ............................................................................... 152
Table 9-6: Cut-off Grade Calculation ..................................................................................................................... 152
Table 9-7: Estimated Process Summary ............................................................................................................... 153
Table 9-8: Huatai Project Underground Ore Reserve Statement, as of 30 September 2024 ............................... 155
Table 9-9: Unit Cost of Wulong Project from 2021 to 2024Q3 .............................................................................. 156
Table 9-10: Cut-off Grade Calculation ..................................................................................................................... 156
– IIIA-13 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 839 ---
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Contents    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS xi
Table 9-11: Estimates Process Summary ............................................................................................................... 157
Table 9-12: Wulong Project Underground Ore Reserve Statement, as of 30 September 2024 ............................. 159
Table 9-13: Unit Cost of Lishan Upper Part and the Dongfeng Upper South from 2021 to 2024 Q3 ..................... 160
Table 9-14: Zinc Cut-off Grade Calculation of Lishan Lower Part ........................................................................... 160
Table 9-15: Estimated Process Summary ............................................................................................................... 162
Table 9-16: Hanfeng Project Underground Ore Reserve Statement, as of 30 September 2024 ............................ 163
Table 9-17: Estimates of MCOG for Gold Ore ........................................................................................................ 164
Table 9-18 Estimated Process Summary ............................................................................................................... 165
Table 9-19 Open Pit Mineral Ore Reserve Statement of Jintai Project, as of 30 September 20241,2,3,5 ................ 167
Table 10-1: Jilong Mine Yearly Stope Production from 2021 to 2024 Q3 ............................................................... 170
Table 10-2: Jilong Mine Yearly Production for comprehensive utilization from 2021 to 2024 Q3 .......................... 170
Table 10-3: Type of Access in Each Zone .............................................................................................................. 170
Table 10-4: Development System in Each Zone ..................................................................................................... 171
Table 10-5: Mine Equipment in Zone 1 ................................................................................................................... 173
Table 10-6: Mine Equipment in Zone 2 ................................................................................................................... 173
Table 10-7: Mine Equipment in Zone 3 ................................................................................................................... 174
Table 10-8: Production Schedule ............................................................................................................................ 175
Table 10-9: Huatai Project Yearly Ore Production from 2020 to 2023 .................................................................... 177
Table 10-10 Main Mine Equipment for Huatai Project .............................................................................................. 180
Table 10-11: Production Schedule ............................................................................................................................ 183
Table 10-12: Wulong Mine Yearly Stope Production from 2021 to 2024 Q3 ............................................................ 186
Table 10-13: Wulong Mine Yearly Production for comprehensive utilization from 2021 to 2024 Q3 ........................ 186
Table 10-14: Mining Equipment in Each Zone .......................................................................................................... 190
Table 10-15: Production Schedule ............................................................................................................................ 191
Table 10-16: Summary of Rock Mechanical Properties of Lishan Lower Part (Stage I) ........................................... 193
Table 10-17: Summary of Stoping Methods for Lishan Lower Part (Stage I) ........................................................... 194
Table 10-18: Hanfeng Project (Lishan Mine Upper Part and the Dongfeng Mine U pper South) Yearly Ore
Production from 2021 to 2024 Q3 ........................................................................................................ 195
Table 10-19: Hanfeng Project (Dongfeng Mine Upper North) Yearly Ore Production from 2021 to 2024 Q3 .......... 195
Table 10-20 Mine Equipment Requirements for Hanfeng Project ............................................................................ 199
Table 10-21: Production Schedule ............................................................................................................................ 199
Table 10-22: Jintai Project Slope Stability Analysis Results ..................................................................................... 201
Table 10-23: Excavator (1m3 bucket) Capacity Estimates ....................................................................................... 202
Table 10-24: Truck Capacity Estimates .................................................................................................................... 203
Table 10-25: Input Parameter for Pit Optimization in FS 2022 ................................................................................. 204
Table 10-26: Summary of Design Inputs .................................................................................................................. 205
Table 10-27: Pit Design Result in FS 2022 .............................................................................................................. 205
Table 10-28: Jintai Mine Yearly Ore Production from 2023 to 2024Q3 .................................................................... 206
Table 10-29: Water Inflow Estimates and Dewatering ............................................................................................. 206
Table 10-30: Main Mining Equipment Fleet as Proposed ........................................................................................ 207
Table 10-31 Mining Schedule of SRK ...................................................................................................................... 208
Table 10-32 The Summary of LoM ........................................................................................................................... 210
Table 11-1: Test Results of Ore Sample from Jilong Mine ..................................................................................... 212
Table 11-2: Main Equipment of Jilong Processing Plants ....................................................................................... 214
Table 11-3: Historical Production Index of Jilong Plant ........................................................................................... 217
Table 11-4: Test Results of Ore Sample from Huatai Mine .................................................................................... 219
Table 11-5: Main Equipment of Huatai Processing Plant ........................................................................................ 223
Table 11-6: Historical Production Index of Huatai Processing Plant ....................................................................... 224
Table 11-7: Test Results of ore sample from Wulong Mine .................................................................................... 226
Table 11-8: Main Equipment List of Wulong Processing Plant ............................................................................... 229
Table 11-9: Historical Production Index of Wulong Processing Plant ..................................................................... 230
Table 11-10: Test Results of Ore Sample from Lishan Mine .................................................................................... 232
– IIIA-14 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 840 ---
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Contents    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS xii
Table 11-11: Test Results of Deep Ore Sample from Dongfeng Mine ...................................................................... 233
Table 11-12: Test Results of Refractory Ore Sample from Dongfeng Mine .............................................................. 233
Table 11-13: Main Equipment of Lishan Processing Plant ....................................................................................... 235
Table 11-14: Main Equipment of Dongfeng Processing Plant .................................................................................. 235
Table 11-15: Historical Production Index of Lishan and Dongfeng Processing Plants ............................................. 237
Table 11-16: Ore Physical Property Test Results ..................................................................................................... 240
Table 11-17: Heap Leaching Facilities and Equipment ............................................................................................. 245
Table 11-18: Designed Technical Index of Heap Leaching ...................................................................................... 247
Table 11-19: Heap Leaching Production Performance, as of 30 September 2024 .................................................. 248
Table 13-1: Details of the EIA Reports and Approvals for the Jilong Project ........................................................... 255
Table 13-2: Details of the EIA Reports and Approvals for the Huatai Project .......................................................... 255
Table 13-3: Details of the EIA Reports and Approvals for the Wulong Project ........................................................ 256
Table 13-4: Details of the EIA Reports and Approvals for the Hanfeng Project ....................................................... 256
Table 13-5: Details of the EIA Reports and Approvals for the Jintai Project ............................................................ 256
Table 13-6: Details of Safety Production Permits of Jilong Project .......................................................................... 257
Table 13-7: Details of Safety Production Permits of Huatai Project ......................................................................... 258
Table 13-8: Details of Safety Production Permits of Wulong Project ....................................................................... 258
Table 13-9: Details of Safety Production Permits of Hanfeng Project ...................................................................... 259
Table 13-10: Details of Safety Production Permits of Jintai Project ......................................................................... 260
Table 13-11: Details of Water Use Permits of Jilong Project ................................................................................... 260
Table 13-12: Details of Water Use Permits of Huatai Project .................................................................................. 261
Table 13-13: Details of Water Use Permits of Wulong Project ................................................................................. 261
Table 13-14: Details of Water Use Permits of Hanfeng Project ............................................................................... 261
Table 13-15: Details of Water Use Permits of Jintai Project .................................................................................... 261
Table 14-1: Jilong Capital Expenditures from 2021 to 2024 Q3 ............................................................................... 273
Table 14-2: Initial Capital Expenditures for Jilong Expansion .................................................................................. 273
Table 14-3: Initial Capital Expenditures for Jilong Deeper Expansion ..................................................................... 274
Table 14-4: Operating Costs from 2021 to 2024 Q3 in Jilong Project ...................................................................... 275
Table 14-5: Operating Unit Costs from 2021 to 2024 Q3 in Jilong Project .............................................................. 275
Table 14-6: Operating Cost Forecast in Jilong Project (Million RMB) ...................................................................... 275
Table 14-7: Huatai Capital Expenditures from 2021 to 2024 Q3 .............................................................................. 276
Table 14-8: Huatai Future Expansion ....................................................................................................................... 276
Table 14-9: Operating Costs from 2021 to 2024 Q3 in Huatai Project ..................................................................... 277
Table 14-10: Operating Unit Costs from 2021 to 2024 Q3 in Huatai Project ........................................................... 277
Table 14-11: Operating Cost Forecast in Huatai Project (Million RMB) ................................................................... 278
Table 14-12: Wulong Capital Expenditures from 2021 to 2024 Q3 .......................................................................... 279
Table 14-13: Operating Costs from 2021 to 2024 Q3 in Wulong Project ................................................................. 279
Table 14-14: Operating Unit Costs from 2021 to 2024 Q3 in Wulong Project ......................................................... 279
Table 14-15: Operating Cost Forecast in Wulong Project (Million RMB) ................................................................. 280
Table 14-16: Hanfeng (Upper Part of the Lishan Mine and the Don gfeng Mine) Capital Expenditures from
2021 to 2024 Q3 ................................................................................................................................... 281
Table 14-17: Operating Costs from 2021 to 2024 Q3 in Hanfeng Project................................................................ 281
Table 14-18: Operating Unit Costs from 2021 to 2024 Q3 in Hanfeng Project ........................................................ 281
Table 14-19: Operating Cost Forecast in Hanfeng Project (Million RMB) ................................................................ 282
Table 14-20: Jintai capital expenditure from 2021 to 2024 Q3 ................................................................................. 282
Table 14-21: Operating Costs from 2023 to 2024 Q3 in Jintai Project ..................................................................... 283
Table 14-22: Operating Unit Costs from 2023 to 2024 Q3 in Jintai Project ............................................................. 283
Table 14-23: Operating Cost Forecast in Jintai Project (Million RMB) ..................................................................... 283
Table 15-1: Gold and Zinc Price Forecasts .............................................................................................................. 286
Table 15-2: Technical Parameters for Jilong Project ................................................................................................ 286
Table 15-3: Total Cash Flow over the LoM for Jilong Project (unit: RMB mln) ........................................................ 289
Table 15-4: NPV with Different Discount Rate for Jilong Project (unit: RMB mln) ................................................... 289
– IIIA-15 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Table 15-5: Sensitivity Analysis for Jilong Project at 10% Discount Rate (unit: RMB mln) ...................................... 290
Table 15-6: Technical Parameters for Huatai Project ............................................................................................... 291
Table 15-7: Total Cash Flow over the LoM for Huatai Project (Unit: RMB mln) ....................................................... 293
Table 15-8: NPV with Different Discount Rate for Huatai Project (Unit: RMB mln) .................................................. 294
Table 15-9: Sensitivity Analysis for Huatai Project at 10% Discount Rate (Unit: RMB mln) .................................... 295
Table 15-10: Technical Parameters for Wulong Project ........................................................................................... 296
Table 15-11: Total Cash Flow over the LoM for Wulong Project (Unit: RMB mln) ................................................... 298
Table 15-12: NPV with Different Discount Rate for Wulong Project (Unit: RMB mln) .............................................. 299
Table 15-13: Sensitivity Analysis for Wulong Project at 10% Discount Rate (Unit: RMB mln) ................................ 299
Table 15-14: Technical Parameters for Hanfeng Project ......................................................................................... 301
Table 15-15: Total Cash Flow over the LoM for Hanfeng Project (Unit: RMB mln) ................................................. 303
Table 15-16: NPV with Different Discount Rate for Hanfeng Project (Unit: RMB mln) ............................................ 304
Table 15-17: Sensitivity Analysis for Hanfeng Project at 10% Discount Rate (Unit: RMB mln) ............................... 304
Table 15-18: Technical Parameters for Jintai Project ............................................................................................... 306
Table 15-19: Total Cash Flow over the LoM for Jintai Project (Unit: RMB mln) ....................................................... 308
Table 15-20: NPV with Different Discount Rate for Jintai Project (Unit: RMB mln) .................................................. 309
Table 15-21: Sensitivity Analysis for Jintai Project at10% Discount Rate (Unit: RMB mln) ..................................... 309
Table 16-1: Risk Assessment for Chifeng Gold Project .......................................................................................... 311

Figures
Figure 3-1: General Location Map of the Project (northeast part) ............................................................................ 10
Figure 3-2: General Location Map of the Project (southwestern part) ..................................................................... 10
Figure 3-3: Locations of the Mining and Exploration Licences ................................................................................. 16
Figure 5-1: Regional Geology Setting of Wulong Project ......................................................................................... 24
Figure 5-2: Regional Geology Setting of Hanfeng Project ....................................................................................... 25
Figure 5-3: Local Geology Map of Zhuanshanzi Mine .............................................................................................. 27
Figure 5-4: Local Geology Map ................................................................................................................................ 28
Figure 5-5: Property Geology Map ........................................................................................................................... 31
Figure 5-6: Geology Map of Lishan Mine ................................................................................................................. 34
Figure 5-7: Geology Map of Dongfeng Mine ............................................................................................................ 35
Figure 5-8: Local Geology Setting ............................................................................................................................ 35
Figure 5-9: Geological Map of Level 20 of Vein #163 .............................................................................................. 41
Figure 5-10: The Geological Map of Mining Level #16 ............................................................................................... 42
Figure 5-11: The Line 805 Section Map in Haojingou Area ....................................................................................... 43
Figure 5-12: Section Map of Line 4 for Mineralised Domain V1 ................................................................................. 45
Figure 5-13: Section Map of Line 98 for Mineralised Domain V4 ............................................................................... 46
Figure 5-14: Section Map of Line 106 for Mineralised Domain V4 ............................................................................. 46
Figure 5-15: Section Map of Line 95 for Mineralised Domain V10 ............................................................................. 47
Figure 6-1: Distribution of Drillholes in the Zhuanshanzi #1#2#3&depth Block ....................................................... 56
Figure 6-2: Borehole Location Map .......................................................................................................................... 57
Figure 6-3: Distribution Map of Drillholes ................................................................................................................. 61
Figure 6-4: Map Showing the Distribution of Drilling ................................................................................................ 63
Figure 6-5: Performance of Internal and External Samples from 2018 Producti on Exploration by Jilong
Mining ..................................................................................................................................................... 65
Figure 6-6: Internal and External Samples Performance of the Pengjiagou Mine ................................................... 67
Figure 6-7: Scatter Plots of SG against gold Grade ................................................................................................. 69
Figure 6-8: Internal and External Performance of Wulong Mine ................................................................................ 69
Figure 6-9: Internal and External Performance of Haojingou-Ligunzi Gold Deposit ................................................ 70
Figure 6-10: Internal and External Checks of Lishan Mine from 2020-2011 .............................................................. 72
Figure 6-11: Internal Check of Lishan Deposit（bellow -92m asl） from 2011 to 2020 ............................................ 73
Figure 6-12: Internal check of Dongfeng Deposit in 2011 .......................................................................................... 75
– IIIA-16 –
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FOR THE PRC MINES


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Figure 6-13: External check of Dongfeng Deposit in 2011 ......................................................................................... 76
Figure 6-14: Mo Internal check of Dongfeng Deposit from 2013 to 2023................................................................... 77
Figure 6-15: Performance of Internal and External Checks for General Exploration ................................................. 79
Figure 6-16: Performance of Internal and External Checks for Resource Verification ............................................... 80
Figure 6-17: Performance of Internal and External Checks for Advanced Exploration .............................................. 81
Figure 7-1: Performance of SRK Verification Samples from Zhuanshanzi Mine ..................................................... 83
Figure 7-2: Performance of SRK Verification Samples from Honghuagou Mine ..................................................... 84
Figure 7-3: Performance of SRK Verification Samples from Lianhuashan Mine ..................................................... 84
Figure 7-4: Performance of SRK Verification for Wulong Project ............................................................................. 85
Figure 7-5: Performance of SRK 2023 Verification Samples from Lishan Mine ........................................................ 86
Figure 7-6:  Performance of SRK 2023 Verification Samples from Dongfeng Mine .................................................. 87
Figure 7-7: SRK 2023 Verification on Xidengping Gold Mine .................................................................................... 88
Figure 8-1: Hole location of Lishan and Dongfeng Mines .......................................................................................... 92
Figure 8-2: Mineralised Domains in the Zhuanshanzi Mine ..................................................................................... 93
Figure 8-3: Mineralised Domains of Honghuagou, Pengjiagou and Lianhuashan Mines .......................................... 94
Figure 8-4: Mineralised Domains of Wulong Mine and Ligunzi and Haojingou-Ligunzi Deposits .............................. 95
Figure 8-5: Mineralisation Domains of Lishan and Dongfeng Mines .......................................................................... 96
Figure 8-6: Mineralised Domains of Xidengping Mine ................................................................................................ 96
Figure 8-7: Histograms of Sample Length of Zhuanshanzi Mine ............................................................................. 97
Figure 8-8: Histogram of Sample Length of #1 Mining Zone of Honghuagou mine ................................................... 98
Figure 8-9: Histograms of Sample Length for Wulong Mine, Ligunzi and Haojingou-Ligunzi Deposits ..................... 99
Figure 8-10: Histogram of Sample Length for Lishan and Dongfeng Mines ............................................................ 100
Figure 8-11: Histogram of the Sample Length of Xidengping Mine .......................................................................... 102
Figure 8-12: Cumulative Probability Plot and Histogram for the #1#2#3&depth Blocks .......................................... 103
Figure 8-13: Cumulative Probability Plots for #1 Mining Zone and #26 Vein ........................................................... 104
Figure 8-14: Au Histogram and Cumulative Probability Curve of Wulong Mine ....................................................... 105
Figure 8-15: Au Histogram and Cumulative Probability Curve of Ligunzi Deposit ................................................... 105
Figure 8-16: Au Histogram and Cumulative Probability Curve of Haojingou-Ligunzi Deposit ................................. 105
Figure 8-17: Cumulative-probability plots for Lishan and Dongfeng Mines .............................................................. 106
Figure 8-18: Histograms and Cumulative Probability Curves of Gold Mineralised Domains ................................... 107
Figure 8-19: Au Swath Plot of #1#2#3&depth Block of Zhuanshanzi Mine .............................................................. 119
Figure 8-20: Au Swath Plot of #5 block of Zhuanshanzi Mine .................................................................................. 120
Figure 8-21: Au Swath Plot of #6 block of Zhuanshanzi Mine .................................................................................. 120
Figure 8-22: Au Swath Plot of #7 block of Zhuanshanzi Mine .................................................................................. 121
Figure 8-23: Au Swath Plots of #1 Mining Zone and #86 Vein ................................................................................. 121
Figure 8-24: Au Swath Plots of #26 Vein and #3&#7 Vein ....................................................................................... 122
Figure 8-25: Au Swath Plots of #5 Mining Zone and Pengjiagou Mine .................................................................... 123
Figure 8-26: Au Swath Plot of Wulong Mine ............................................................................................................. 123
Figure 8-27: Au Swath Plots of Ligunzi and Haojingou-Ligunzi Deposits ................................................................ 124
Figure 8-28: Zn Swath Plot of Lishan Mine and Mo Swath Plot for Dongfeng Mine ................................................ 125
Figure 8-29: Au Swath Plot of Xidengping Mine ....................................................................................................... 126
Figure 8-30: Mineral Resource Category Distribution of Zhuanshanzi Mine ............................................................ 127
Figure 8-31: Mineral Resource Category Distribution of Huatai Project ................................................................... 128
Figure 8-32: Mineral Resource Category Distribution of Wulong Project ................................................................. 129
Figure 8-33: Mineral Resource Category Distributions of Lishan and Dongfeng Mines .......................................... 130
Figure 8-34: Mineral Resource Category Distribution of Xidengping Mine .............................................................. 130
Figure 8-35: Grade Tonnage Curves of #1#2#3&depth Block of Zhuanshanzi Mine ............................................... 138
Figure 8-36: Grade Tonnage Curves of Huatai Project ............................................................................................ 140
Figure 8-37: Grade Tonnage Curves of Wulong Project .......................................................................................... 142
Figure 8-38: Tonnage-Grade Curves of Lishan and Dongfeng Mines ..................................................................... 143
Figure 8-39: Grade Tonnage Curves of Xidengping Mine ........................................................................................ 144
Figure 9-1: Relationship Between Mineral Resources and Ore Reserve ............................................................... 145
– IIIA-17 –
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FOR THE PRC MINES


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Figure 9-2: Plan View of Mining Zones ................................................................................................................... 146
Figure 9-3: Skin Analysis for Mining Dilution .......................................................................................................... 148
Figure 9-4: Estimated Process - Change in Tonnes............................................................................................... 149
Figure 9-5: Estimated Process - Change in Metal Contained ................................................................................ 149
Figure 9-6: Plan View of Mining Zones ................................................................................................................... 151
Figure 9-7: Skin Analysis for Mining Dilution .......................................................................................................... 153
Figure 9-8: Estimated Process - Change in Tonnes............................................................................................... 154
Figure 9-9: Estimated Process - Change in Metal Contained ................................................................................ 154
Figure 9-10: Plan View of Mining Zones of Wulong ................................................................................................. 155
Figure 9-11: Skin Analysis for Mining Dilution .......................................................................................................... 157
Figure 9-12: Estimated Process - Change in Tonnes............................................................................................... 158
Figure 9-13: Estimated Process - Change in Metal Contained ................................................................................ 158
Figure 9-14: Skin Analysis for Mining Dilution .......................................................................................................... 161
Figure 9-15: Estimated Process - Change in Tonnes............................................................................................... 162
Figure 9-16: Estimated Process - Change in Metal Contained ................................................................................ 163
Figure 9-17: Estimated Process - Change in Tonnes............................................................................................... 166
Figure 9-18: Estimated Process - Change in Metal Contained ................................................................................ 166
Figure 10-1: Resuing Method ................................................................................................................................... 169
Figure 10-2: Mine cart in the underground ............................................................................................................... 169
Figure 10-3: Design of Shaft ..................................................................................................................................... 171
Figure 10-4: Example of Ventilation Design in Jilong Mine (Zone 1 to Zone 3) ....................................................... 172
Figure 10-5: Production Schedule ............................................................................................................................ 175
Figure 10-6: Photos of Main Adit Portal and Shaft Station on Level 5 ..................................................................... 178
Figure 10-7: Photos of Typical Level Drift and Cross Cut Drift of Lianhuashan #5 Zone ......................................... 178
Figure 10-8: Photos of Level 5 Sump and Main Power Substation of Lianhuashan #5 Zone .................................. 179
Figure 10-9: Production Schedule ............................................................................................................................ 182
Figure 10-10: Zone Layout ....................................................................................................................................... 184
Figure 10-11: Overhand Cut and Fill ........................................................................................................................ 185
Figure 10-12: Level 7 in Zone 2 (-136m asl) ............................................................................................................ 187
Figure 10-13: Pan Views of Zone 2 (left), Zone 3 (centre) and Zones 4 and 5 (right) As-builts .............................. 187
Figure 10-14: Aver Example of 2D polygonal long sections in Zone 4 ..................................................................... 188
Figure 10-15: Example of development design in Zone 4 and Zone 5..................................................................... 188
Figure 10-16: Ventilation system design in Zone 3 .................................................................................................. 189
Figure 10-17: Production Schedule .......................................................................................................................... 191
Figure 10-18: Longitudinal Projected View of Lishan Upper Part ............................................................................. 195
Figure 10-19: Longitudinal Projected View of Dongfeng Upper Part ........................................................................ 196
Figure 10-20: Photos of Access of Adit and Drift on Level 3 at Dongfeng Mine ...................................................... 197
Figure 10-21: Photos of Main Sump and Power Substation on Adit Level of Dongfeng Mine ................................. 198
Figure 10-22: Shaft Access on Adit Level of Dongfeng Upper Part ......................................................................... 198
Figure 10-23: Production Schedule .......................................................................................................................... 200
Figure 10-24: Production Pit in V1 Pit Area .............................................................................................................. 201
Figure 10-25: Pit Design for V1 and V2 by GOCOM ................................................................................................ 205
Figure 10-26: TMM Schedule over LoM ................................................................................................................... 209
Figure 10-27: Plant Feed Schedule over LoM .......................................................................................................... 210
Figure 11-1: Production Flowsheet of Jilong Processing Plant ................................................................................ 213
Figure 11-2: Site Photos of #1 Jilong Plant .............................................................................................................. 216
Figure 11-3: Site Photos of #2 Jilong Plant .............................................................................................................. 217
Figure 11-4: TSF of Jilong Project ............................................................................................................................ 218
Figure 11-5: Processing Flowsheet of Huatai Processing Plant .............................................................................. 222
Figure 11-6: Site Photos of Huatai Processing Plant ............................................................................................... 223
Figure 11-7: TSF of Huatai Mining ............................................................................................................................ 225
Figure 11-8: Production Process Flowsheet of Wulong Processing Plant ............................................................... 228
– IIIA-18 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Figure 11-9: Site Photos of Wulong Processing Plant .............................................................................................. 230
Figure 11-10: TSF of Wulong Mining ........................................................................................................................ 231
Figure 11-11: Photos of Lishan Processing Plant .................................................................................................... 236
Figure 11-12: Photos of Dongfeng Processing Plant ............................................................................................... 237
Figure 11-13: TSF of Hanfeng Mining ...................................................................................................................... 239
Figure 11-14: Heap Leaching Process Flowsheet of Xidengping Gold Mine ........................................................... 244
Figure 11-15: Main Facility Photos of Xidengping Heap Leach Plant ...................................................................... 246
Figure 11-16: Heap leaching Recovery Curve for Xidengping Mine ........................................................................ 248
Figure 12-1: Power Station of Liantiexiang ............................................................................................................... 252
Figure 12-2: Planned Water Source Point along Heihui River ................................................................................. 253
Figure 15-1: 5-Year Price Trends of Gold, Copper, Lead and Zinc .......................................................................... 285
Figure 15-2: Jilong Project Schedule ........................................................................................................................ 287
Figure 15-3: Annual Capex over the LoM ................................................................................................................. 287
Figure 15-4: Annual Opex over the LoM .................................................................................................................. 288
Figure 15-5: Annual Net Cash Flow for Jilong Project (Unit: RMB mln) ................................................................... 289
Figure 15-6: Sensitivity Analysis for Jilong Project at 10% Discount Rate (unit: RMB mln) ..................................... 290
Figure 15-7: Huatai Project Schedule ....................................................................................................................... 291
Figure 15-8: Annual Capex over the LoM ................................................................................................................. 292
Figure 15-9: Annual Opex over the LoM .................................................................................................................. 293
Figure 15-10: Annual Net Cash Flow for Huatai Project (Unit: RMB mln ) ............................................................... 294
Figure 15-11: Sensitivity Analysis for Huatai Project at 10% Discount Rate (Unit: RMB mln) ................................. 295
Figure 15-12: Wulong Project Schedule ................................................................................................................... 296
Figure 15-13: Annual Capex over the LoM ............................................................................................................... 297
Figure 15-14: Annual Opex over the LoM ................................................................................................................ 297
Figure 15-15: Annual Net Cash Flow for Wulong Project (Unit: RMB mln) .............................................................. 299
Figure 15-16: Sensitivity Analysis for Wulong Project at 10% Discount Rate (Unit: RMB mln) ............................... 300
Figure 15-17: Hanfeng Project Schedule ................................................................................................................. 301
Figure 15-18: Annual Opex over the LoM ................................................................................................................ 302
Figure 15-19: Annual Net Cash Flow for Hanfeng Project (Unit: RMB mln ) ........................................................... 304
Figure 15-20: Sensitivity Analysis for Hanfeng Project at 10% Discount Rate (Unit: RMB mln) .............................. 305
Figure 15-21: Jintai Project Schedule ....................................................................................................................... 306
Figure 15-22: Annual Capex over the LoM ............................................................................................................... 307
Figure 15-23: Annual Opex over the LoM ................................................................................................................ 307
Figure 15-24: Annual Net Cash Flow for Jintai Project (Unit: RMB mln ) ................................................................. 308
Figure 15-25: Sensitivity Analysis for Jintai Project at10% Discount Rate (Unit: RMB mln) .................................... 310

Appendices
Appendix A JORC Code Table 1
Appendix B Compliance with Chapter 18
Appendix C Chapter 2.6 of the Guide for New Listing Applicants
Appendix D Assay Results



– IIIA-19 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
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Useful Definitions    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS xvii
Useful Definitions
This list contains definitions of symbols, units, abbreviations, and terminology that may be unfamiliar to the reader.
3D three dimensional
% percent
° degree, either temperature or angle of inclination
°C degree, Celsius temperature
′ Minute
″ Second
× Multiply by
AISC All-in sustaining cost
Au element symbol for gold
asl above sea level
AusIMM Australasian Institute of Mining and Metallurgy
BFA Bench face angles
CIM the Canadian Institute of Mining, Metallurgy and Petroleum
cm centimetre
cm3 cubic centimetre
RMB Chinese Yuan currency
COG Cut-off grade
CPR Competent Person’s Report
CRMs Certified reference materials.
Cu element symbol for copper
Designed Mining Capacity The production capacity planned based on the mine’s design, equipment, and technical parameters
E East.
Exchange The Stock Exchange of Hongkong Ltd., a wholly owned su bsidiary of Hong Kong Exchanges and
Clearing Ltd (“HKEx”)
FEL Front end loader
g gram(s)
g/cm3 gram per cubic centimetre
g/t gram per tonne
GOCOM Gocom Engineering Design Company
Hanfeng Mining Jilin Hanfeng Mining Technology Co, Ltd
HKEx Hong Kong Exchanges of Clearing Ltd.
Huatai Mining Chifeng Huatai Mining Co., Ltd.
Indicated Mineral Resource that part of a resource for which to nnage, densities, shape, physical characteristics, grade and
mineral content can be estimated with a reasonable level of confidence. It is based on exploration,
– IIIA-20 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
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Useful Definitions    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS xviii
sampling and testing information gathered through appropriate techniques from locations such as
outcrops, trenches, pits, workings and drill holes. The locatio ns are too widely or inappropriately
spaced to confirm geological and/or grade continuity but are spaced closely enough for continuity
to be assumed
Inferred Mineral Resource that part of a resource for which ton nage, grade and mineral content can be estimated with a low
level of confidence. It is inferred from geological evidence and assumed but not verified geological
and/or grade continuity. It is based on information gathered th rough appropriate techniques from
locations such as outcrops, trenc hes, pits, workings, and drill  holes which may be limited or of
uncertain quality and reliability
Inner Mongolia Inner Mongolia Autonomous Region
IDW Inverse Distance Weighting
IDW2 Inverse Distance Weighting Square
IPO Initial Public Offering
Jilong Mining Chifeng Jilong Mining Co., Ltd.
Jintai/Jintai Mining Eryuan Jint ai Mining Development Co., Ltd.
JORC Code the 2012 edition of the Australasian code for reporting of exploration results, mineral resources and
ore reserves prepared by the Joint Ore Reserves Committee of The Australasian Institute of Mining
and Metallurgy, Australian Institute of Geoscientists and Mineral Council of Australia
k Kilo or thousand
kg Kilogram, equivalent to 1,000 grams
km Kilometre, equivalent to 1,000 metres
km2 square kilometre
kt thousands tonnes
kV Kilovolts, equivalent to 1,000 volts
kW Kilowatt, equivalent to 1,000 watts
LoM Life of mine
m metre
m2 square metre
m3 cubic metre
Measured Mineral
Resource
that part of a resource for whi ch tonnage, densities, shape, ph ysical 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
M million
mm millimetre
MLR Ministry of Land and Resources
m asl relevant elevation to sea level in meter
m/s Meters per second.
Mt million tonnes
Mtpa million tonnes per year
– IIIA-21 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
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Useful Definitions    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS xix
MW megawatt, equivalent to 1,000,000 watts
N north, also the element symbol for nitrogen
NE northeast
NEE northeast east
NQ size core 47.6mm diameter
NW northwest
NI43-101 the Canadian Securities Administrators’ National Instrument
Oz. troy ounce, equivalent to 31.1035 grams
Pb element symbol for lead
Permitted mining capacity permitted mining capacity means the a mount of ore allowed to be mined annually as stated on the
mining license
pH a measure of the acidity or alk alinity of a solution, numeri cally equal to 7 for neutral solutions,
increasing with increasing alkalinity and decreasing with increasing acidity. The pH scale commonly
in use ranges from 0 to 14
ppb part per billion
PPE personal protective equipment
ppm parts per million, equivalent to grams per tonne (g/t)
PQ size core 85mm diameter
P.R. China the People’s Republic of China
Probable Ore Reserve the economically mineable part of an indic ated, and in some circumst ances measured, resource.
It includes diluting materials and allowances for losses which may occur when the material is
mined. Appropriate assessments, which may include feasibility studies, have been carried out, and
include consideration of and modification by realistically assumed mining, metallurgical, economic,
marketing, legal, environmental, social and government factors. These assessments demonstrate
at the time of reporting that extraction could reasonably be justified
Proved Ore Reserve the economica lly mineable part of a measured  resource. It includes diluting materials and
allowances for losses which may occur when the material is mine d. Appropriate assessments,
which may include feasibility studies, have been carried out, a nd include consideration of and
modification by realistically assumed mining, metallurgical, ec onomic, marketing, legal,
environmental, social and governm ent factors. These assessments  demonstrate at the time of
reporting that extraction could r easonably be justified. Also r eferred to as recoverable proved
reserve
QA/QC quality assurance and quality control
QPR Qualified Person’s Report
QTY quantity
S south, also the element symbol for sulphur
RPEEE reasonable prospects for eventual economic extraction
SE southeast
SG Specific gravity.
SRK SRK Consulting (China) Ltd.
– IIIA-22 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
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Useful Definitions    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS xx
t tonne (metric ton)
Te Element symbol for tellurium
TMM Total material movement
Tpa or t/a tonne per annum
Tpd or t/d tonne per day
Valmin Code the Code for Technical Assessment and Valuation of Mineral and Petroleum Assets and Securities
for Independent Expert Reports
Yanbian Yanbian Korean Autonomous Prefecture
Zn element symbol for zinc

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Executive Summary    Final
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Executive Summary
Introduction
Chifeng Jilong Gold Mining Co., Ltd. (“Chifeng Gold”, the “Company” or the “Client”) commissioned
SRK Consulting China Limited (“SRK’) to undertake an independen t technical assessment of all
relevant aspects of its five subsidiaries’ operating gold and p olymetallic mines and associated
processing and metallurgical plants (hereafter referred to as t he “ Chifeng Gold Project ” or the
“Project”) in Inner Mongolia Autonomous Region (“Inner Mongolia”), Liaoning, Jilin and Yunnan
Provinces of the People’s Republic of China (“China’).
SRK understands that the independent technical assessment was r equired to be included in a
Competent Person’s Report (“ CPR”, the “ Report” or this “ Report”) to provide Chifeng Gold and
potential equity investors as well as possible future sharehold ers with SRK’s technical opinions on
the Project.
The Report was prepared following the requirements of the 2012 edition of the Australasian Code
for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the “JORC Code”) and
in accordance with the rules governing the listing of securities on the Stock Exchange of Hong Kong
Ltd (the “Exchange”) including the Chapter 18 requirements (Appendix B), Chapter 2.6 of the Guide
for New Listing Applicants (Appendi x C) and other relevant regu lations of the Exchange and Hong
Kong Exchanges and Clearing Ltd (“HKEx”).
This Report does not express an opinion as to the value of mineral or other assets involved.
Summary of Principal Objectives
The principal objective of this Report is to provide the Compan y and potential equity investors and
future shareholders of the Company with an independent technica l assessment of the geology and
exploration, Mineral Resources and Ore Reserve, Mining methods and processing and metallurgical
technologies, technical and economic analysis, and environmenta l and social aspects of the
reviewed Project base on all available technical data. The aim has been to produce a CPR suitable
for inclusion in documents that the Company plans to use for the proposed listing on the Main Board
of the Exchange.
Outline of Work Program
The work program of this Project included:
 review of all relevant information and documents provided by Chifeng Gold as of 30 September
2024;
 site inspection to each of mines, processing and metallurgical plants and supporting facilities in
December 2022, January and March 2023, and May and June 2024;
 data verification conducted by SRK in December 2022 and May 2024;
 discussion with the Company management and technical personnel;
 analysis of the data provided by the Company and generated by SRK;
– IIIA-24 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS xxii
 construct the geological solids, prepare data for statistical, established the block model, estimate
grades, tabulate Mineral Resources;
 preparation of a draft report in accordance with the JORC Code and the rules governing the
listing of securities on the Exchange including the Chapter 18 requirements and other relevant
regulations of the Exchange and HK Ex (the declaration date of M ineral Resources and Ore
Reserves is 30 September 2024); and
 submission of the draft to Chifeng Gold and the related third parties for comments and finalization
of the draft based on feedback.
Results
Overall
The reviewed Chifeng Gold Project includes four (4) gold projec ts and one (1) polymetallic project;
they are owned and operated by Chifeng Gold’s five subsidiaries.
Jilong Project is an operating gold project. It is wholly owned and operated by Chifeng Jilong Mining
Co., Ltd. (“Jilong Mining”). The project consists of the Zhuanshanzi gold mine (“Zhuanshanzi Mine”)
and Zhuanshanzi #4#5#6#7 gold mine (“ #4#5#6#7 Mine”) and two processing and metallurgical
plants (hereafter refer to as #1 Jilong Plant and #2 Jilong Plant, respectively). These properties
are located in Aohanqi (敖汉旗), Inner Mongolia. The Zhuanshanzi mining license covers an area of
8.61 square kilometres (“km 2“) with a permitted mining capacity of 180,000tpa and Zhuanshan zi
#4#5#6#7 mining license covers an area of 9.134km2 with a permitted mining capacity of 60,000tpa.
Huatai Project is an operating gold project. It is wholly owned  and operated by the Chifeng Huatai
Mining Co., Ltd. (“Huatai Mining”). The Huatai project includes three mining licenses for #26, #3&7
gold veins and #5 mining area in Lianhuashan gold mine (“Lianhuashan Mine”), two mining licenses
for #86 gold vein and #1 mining area in Honghuagou gold mine (“ Honghuagou Mine”) and one is
for Pengjiagou gold mine (“ Pengjiagou Mine”), and one processing and meta llurgical plant (i.e.,
“Huatai Plant”). These properties are loc ated in Songshan District ( 松山区), Chifeng City, Inner
Mongolia. The six mining licenses cover a total area of 10.5173km 2, with a total permitted mining
capacity of 270,000tpa.
Wulong Project is an operating gold project. It is wholly owned  and operated by Liaoning Wulong
Gold Mining Co., Ltd. (“ Wulong Mining”). The Wulong project consists of the Wulong gold mine
(“Wulong Mine”) and one processing plant (i.e., “Wulong Plant”), and two (2) exploration permits of
the Ligunzi and Haojingou-Ligunzi gold deposits.  These properties are located in Dandong, Liaoning
Province. The mining license for Wulong Gold Mine covers an are a of 6.2732km2, with a permitted
mining capacity of 100,000tpa. The exploration permits cover a total area of 4.4912km2.
Jintai Project is an operating gold project. It is wholly owned  and operated by Eryuan Jintai Mining
Development Co., Ltd. (“ Jintai Mining ”). The project consists of the Xidengping gold mine
(“Xidengping Mine”) and associated the heap leaching plant (“ Heap Leaching Plant”), located in
Eryuan County (洱源县), Dali Bai Autonomous Prefecture (大理白族自治州), Yunnan Province. The
Xidengping mining license covers an area of 1.0920 km 2, with a permitted mining capacity of
140,000tpa. The exploration permit for Xidengping gold deposit covers a total area of 10.28km2.
– IIIA-25 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS xxiii
Hanfeng Project is an operating polymetallic project. It is wholly owned and operated by Jilin
Jilin Hanfeng Mining Technology Co., Ltd. (“ Hanfeng Mining”). The project consists of one Lishan
lead-zinc polymetallic mine (“Lishan Mine ”) and associated processing plant (“ Lishan Plant’) and
the Dongfeng molybdenum mine (“ Dongfeng Mine”) and associated processing plant (“ Dongfeng
Plant”), located in Longjing City, Yanbian Korean Autonomous Prefect ure (“ Yanbian”), Jilin
Province.
Details of the reviewed plants are shown in Table ES- 1 and Table ES- 2.
Table ES- 1: Detailed Informat ion on Chifeng Gold’s Mines
Company Mines and Plants Products
Permitted
Mining
Capacity
(tpa)
2024Q1-Q3
Production
(t)
Status
Mining
Chifeng Jilong Mining Co., Ltd
 Zone 1, Zone 2, Zone 3 Raw Ore 180,000 98,101 Production
 Zone 4, Zone 5, Zone 6, Zone 7 Raw Ore 60,000  No Production
Chifeng Huatai Mining Co., Ltd
 #26 Vein, Lianhuashan Mine Raw Ore 30,000

No Production
 #3&#7 Vein, Lianhuashan Mine Raw Ore 60,000 No Production
 5th Mining Area, Lianhuashan Mine Raw Ore 60,000 No Production
 #86 Vein, Honghuagou Mine Raw Ore 30,000 No Production
 1st Mining Area, Honghuagou Mine Raw Ore 60,000 No Production
 Pengjiagou Mine Raw Ore 30,000 No Production
Liaoning Wulong Gold Mining Co., Ltd
 Wulong Mine Raw Ore 100,000 77,822 Production
Eryuan Jintai Mining Development Co., Ltd
 Xidengping Mine Raw Ore 140,000 360,295 Production
Jilin Hanfeng Mining Technology Co, Ltd
 Lishan Mine Raw Ore 600,000 358,362 Production 2
  Dongfeng Mine 1 Raw Ore 99,000 119,622 Production 2
Notes:
1 The Dongfeng Mine's production from Q1 to Q3 of 2024 exceeds the permitted annual production limit due to the inclusion
of comprehensive utilization.
2 Production at Hanfeng Mining (Lishan Mine and Dongfeng Mine) from Q1 to Q3 of 2024 is focused on the Upper Zone.

Table ES- 2: Detailed Informat ion on Chifeng Gold’s Plants
Company Mines and Plants Products
Designed
Processing
Capacity (tpa)
2024Q1-Q3
Production
(kg)
Status
Processing
Chifeng Jilong Mining Co., Ltd
 #1 Jilong Plant 1 Gold Ingot 120,000
791 kg Production  #2 Jilong Plant Gold Ingot 180,000
Chifeng Huatai Mining Co., Ltd 1
 Huatai Plant Gold Ingot 60,000  No Production
Liaoning Wulong Gold Mining Co., Ltd
 Processing Plant Gold Concentrate 900,000 25,190 t Production
Eryuan Jintai Mining Development Co.,
Ltd

 Heap Leaching Plant Au-loaded Carbon 140,000 196 kg Production
– IIIA-26 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 852 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS xxiv
Company Mines and Plants Products
Designed
Processing
Capacity (tpa)
2024Q1-Q3
Production
(kg)
Status
Jilin Hanfeng Mining Technology Co, Ltd2
 Lishan Plant Cu Concentrate

1,396 t Production
  Pb Concentrate 2,686 t Production
  Zn Concentrate 10,291 t Production
  Dongfeng Plant Mo Concentrate   442 t Production
Notes:
1 Huatai Mining’s mines have no production in 2023 and first to third quarters of 2024.
2 The plants treated materials were only from the upper part of t he Lishan Mine and Dongfeng Mine, a small amount of the
original residuals and remnants or original abandoned low-grade  orebodies and very thin orebodies. The lower part of the
Lishan Mine is under construction and the lower part of the Dongfeng Mine is under technical study.

The Jilong Mining, Huatai Mining, Wulong Mining, Jintai Mining and Hanfeng Mining’s properties,
including mines and plants can be easily accessed by national highways and/or provincial and local
concrete-paved roads from their administrative jurisdictions or country towns.
The mines and plants are operated by the subsidiaries of Chifen g Gold, and are relatively well
integrated and well managed operations. The operating standards  at all sites generally follow the
Chinese national mining industrial practices.
Based on a reasonable cut-off grade of gold, zinc or molybdenum , SRK has estimated the Mineral
Resources and Ore Reserves for the Jilong, Huatai, Wulong, Jintai, and Hanfeng projects. As of 30
September 2024, the Mineral Resources and Ore Reserves of the C hifeng Gold Project, as per the
JORC Code guidelines were list in Table ES- 3.
Table ES- 3: Summary of Mineral Resources and Ore Reserves, as of 30 September 2024
Mineral Resources Ore Reserves
Category Cut-off
Grade
Tonnage
(kt)
Au
Grade
（（g/t））
Au
Metal
（（t））
Category Cut-off
Grade
Tonnage
(kt)
Au
Grade
（（g/t））
Au
Metal
（（t））
Jilong Project
MES
1.5g/t Au
484 12.19 5.90 Prov
2.76g/t Au
510 9.81 5.00
IND 424 9.25 3.92 Prob 409 7.38 3.02
MES + IND 907 10.82 9.82 Prov + Prob 919 8.73 8.02
INF 508 9.24 4.70
Huatai Project
MES
1.5g/t Au
 385  5.88 2.27 Prov
2.93g/t Au
226 5.21 1.18
IND  2,146  7.27 15.60 Prob 1,468 6.35 9.32
MES + IND  2,531  7.06 17.87 Prov + Prob 1,694 6.20 10.50
INF  1,281  6.90 8.83
Wulong Project
MES
1.5g/t Au
Prov
2.05g/t Au
- - -
IND  1,261   8.17   10.30  Prob 984 7.30 7.19
MES + IND  1,261   8.17   10.30  Prov + Prob 984 7.30 7.19
INF  1,738   7.21   12.53
Jintai Project
MES
0.17g/t
Au
 3,363   1.68   5.64  Prov
0.25g/t Au
- - -
IND  4,604   1.02   4.70  Prob 1,370 0.75 1.03
MES + IND  7,967   1.30   10.33  Prov + Prob 1,370 0.75 1.03
INF  2,699   1.29   3.49
– IIIA-27 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 853 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS xxv
Mineral Resources Ore Reserves
Category Cut-off
Grade
Tonnage
(kt)
Zn
Grade
（（%））
Zn
Metal
（（kt））
Category Cut-off
Grade
Tonnage
(kt)
Zn
Grade
（（%））
Zn
Metal
（（kt））
Hanfeng Project – Lishan Mine
MES
0.5% Zn
752 2.36 18 Prov
1.42% Zn
390 2.26 9
IND 8,583 2.66 229 Prob 2,920 2.47 72
MES + IND 9,335 2.64 246 Prov + Prob 3,310 2.45 81
INF 10,616 2.9 308
Mineral Resources Ore Reserves
Category Cut-off
Grade
Tonnage
(kt)
Mo
Grade
（（%））
Mo
Metal
（（kt））
Category Cut-off
Grade
Tonnage
(kt)
Mo
Grade
（（%））
Mo
Metal
（（kt））
Hanfeng Project – Dongfeng Mine
MES
0.03%
Mo
1,819 0.11  2  Prov


IND 26,495 0.12  32  Prob
MES + IND 28,314 0.12  34  Prov + Prob
INF 37,053 0.12  45
Source: SRK
Except for the Jintai Mining’s Xidengping Mine, which is an open pit mine with surface mining via
free dig – transportation – heap leaching methodology, all othe r operating mines are developed as
underground mines. Details of mine development and mining methodology adopted by each project
are summarised in Table ES- 4.
Table ES- 4: Details of Mine Dev elopment and Mining Method Adopted by Each Project
Source: SRK
Based on the production schedule for each project over its remaining life of mine (“LoM”), the capital
expenditures (“Capex”) and the forecasted operating expenses (“ Opex”) for each project, and the
forecasted gold and zinc prices and other principal assumptions, SRK has estimated each project’s
net present values (“NPV”) using the discount cashflow method.
Project Mine Development Mining Methodology
Jilong Zhuanshanzi Mine has three stand-alone
development systems
Resuing stoping method
 Access via shafts or adits Mining dilution: 16-17%; Ore loss: 5%
Huatai Six gold mines, each with an independent
development system Modified resuing stoping method
 Access via adit & shaft or incline shaft Mining dilution: 20%; Ore loss: 15%
Wulong
Wulong Mine has three stand-alone underground
operating systems (Zones 2, 3 and 4), Zone 4 is
further separated into the main shaft zone and the
service shaft zone
Overhand cut and fill mining for relatively thicker
orebodies; Resuing method for steep and thin
orebodies
 Access via shafts and blind shafts Mining dilution: 15%; Ore loss: 8%
Jintai Xidengping Mine is an open it mine A conventional open pit mining methodology is used,
comprising free dig & loading, and haulage by truck.
  Mining dilution: 5%; Ore loss: 5%
Hanfeng Both Lishan and Dongfeng mines are underground
mines
Shrinkage delay fill; Slice & fill; Resuing; Sub-level
open stope delay fill.
 Access via adits and blind shafts Mining dilution: 22%; Ore loss: 20%
– IIIA-28 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 854 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS xxvi
At a discount rate of 10%, the NPVs are Renminbi (“RMB”) 1,375 million (“mln”) for the Jilong Project,
RMB278 mln for the Huatai Project, RMB602 mln for the Wulong Project, RMB32 mln for the Hanfeng
Project and RMB106 mln for the Jintai Project.
The positive NPVs for each project indicate they are technically feasible and economically viable.
Operational Licenses and Permits
SRK sighted key operational licenses and permits for Chifeng Gold’s each subsidiary mining project,
including business license; mining license, safety operational permits for mining, processing plant
and TSF; water use permit; and site discharge permit, as shown in Table ES- 5.
Table ES- 5: Key Operational Licen ses and Permits for the Project, as of 30 September 2024
Subsidiary/Project Business
License
Mining
License
Safety Production
Permit
Water Use
Permit
Site Discharge
Permit
Jilong Mining Y Y Y 1 Y Y
Huatai Mining Y Y Y 2 Y Y
Wulong Mining Y Y Y Y Y
Jintai Mining Y Y Y Y Y
Hanfeng Mining Y Y Y Y Y
Note:
1 The safety production permit fo r Jilong Mining’s #3 Mining Sect ion has expired (expiry date: 5 May 2024), which is to be
renewed. Currently, the #3 Mining Section is undergoing technical renovation and is expected to complete by 27 November
2027, and application for a new safety production permit will be followed.
2 The safety production permit for Huatai Mining’s TSF has expired (expiry date: 23 September 2024), which is to be renewed.
The application for its safety production permit is in process.
Geology and Exploration
Jilong Project
Geology and Mineralogy:  Jilong project is situated within the Lianhuashan fault block, Inner
Mongolia platform uplift of North China platform. The outcropped strata in the project region are the
Palaeoarchean Wulashan Group, which is lithologically composed of plagioclase hornblende gneiss,
hornblende plagioclase gneiss, biotite plagioclase hornblende gneiss and migmatite. Overlying rock
sequences are the Early Cretac eous Jiufotang Formation, consist ing of tuffaceous sandstone and
shale, and the Quaternary sediments. The Palaeoarchean Wulashan  Group is the main strata
hosting the gold mineralisation.
Structures of the Zhuanshanzi gold deposit area are well developed, in which the Variscan period is
dominated by folds and the Yanshan period is dominated by fault s. The faults are divided into four
(4) groups, nearly north-south, nearly east west, northwest and  northeast trending faults. The
northwest trending fault is the main structure hosting and controlling the gold mineralisation.
Intrusive rocks are developed at the project area, they include the Early Cretaceous granite, the Late
Cretaceous granite porphyry, the Jurassic diorite and the Permi an diorite. Dykes include Felsite
porphyry, trachyte and quartz vein, which strike northwest, northeast or nearly east west.
The Zhuanshanzi gold deposit is a typical of medium-low temperature hydrothermal gold deposit. It
consists of several gold Mineralisation zones. The wall rock al terations include pyritization,
– IIIA-29 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS xxvii
carbonation, silicification, chloritization, sericitization, and epidote. The mineralisation type is mainly
gold-bearing quartz vein type. Two (2) gold mineralised blocks/ zones in the Zhuanshanzi gold
deposit are included in this report, namely Zhuanshanzi #1#2#3&depth Block and Zhuanshanzi
#4#5#6#&7 Block.
The ore minerals include native gold and silver, pyrite, sphale rite, galena, chalcopyrite magnetite,
hematite, and chalcocite. Gangue minerals include quartz, seric ite, chlorite, calcite, feldspar
hornblende. Ore textures include crystalline texture, cataclastic texture, metasomatic residual texture,
solid melt decomposition texture, structures include disseminat ed structure, vein-like structure,
brecciated structure, banded structure.
Exploration and Quality Control:  The regional geological and mineral exploration began in the
1980s and from then, several phases of exploration work were carried out. The resource and reserve
verification of Zhuanshanzi Miner alisation block was undertaken  from 2010, and the detailed
exploration work of Zhuanshanzi #4-5-6-7 Block are conducted during the period from 2010 to 2012.
SRK was provided with the quality control (“ QC”) data of Zhuanshanzi #1#2#3&depth Block and
Zhuanshanzi #4#5#6#&#7 Block. The sampling preparation, security, and analytical procedures of
the two gold mineralised blocks are acceptable. The pass rates of both internal and external check
samples are acceptable.
SRK has performed data verification by taking duplicate samples  during or after site visit. A total of
154 verification samples were chosen randomly to ensure the representation and were sent to SGS
Mineral Laboratory (“ SGS Lab”), located in Tianjin China by commercial logistic company for
analysis. A large bias was observed between original assay and check results, SRK has checked
with both main laboratory and SG S staff, found that the sample preparation and sample assay
methods are different, the sample preparation protocol which the original main laboratory adopted is
relatively conservative, they use sieve to remove potential visible gold and then for assay to minimize
the nugget effect, which may lead to a system lower bias compar ed to SGS Lab using screen fire
assay method. SRK advised to send the samples to umpire laboratory, the Intertek laboratory for
further verification. Based on the returned assay results, a general trend can be observed although
larger biases are found in the higher-grade samples, which may be caused by the nugget effect of
visible gold.
Huatai Project
Geology and Mineralogy: Tectonically, the Huatai project is also situated within the L ianhuashan
fault block, Inner Mongolia platform uplift of in the North Chi na Platform. The outcropped strata are
the Paleoarchean Wulashan Group, the Early Cretaceous Jiufotang Formation, and the Quaternary
sediments. The Paleoarchean Wulashan Group is the main strata hosting the gold Mineralisation.
Structures in the project region are well developed, and faults are divided into three (3) groups: north-
northeast, northeast and northwest (or west-northwest) trending faults. The northwest trending faults
are the main structures holding and controlling the gold mineralisation.
The Huatai project area is characterized by the extensive magma tic intrusion with multiple stages
and complex types. Magmatic intrusive rocks include Jurassic gr anite-porphyry, Jurassic monzo-
granite and Alkali-Feldspar Granite.
– IIIA-30 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS xxviii
The Huatai Project consists of s everal medium-low temperature h ydrothermal gold deposits of
Honghuagou-Lianhuashan gold mineralisation belt. The wall rock alteration is mainly silicified
pyritization and sericitization, followed by chloritization and  carbonation. The mineralisation type is
mainly gold-bearing quartz vein type.
A total of 6 mineralised gold zones/blocks are included in this  report; they are the #1 Mining Zone
and #86 Vein in Honghuagou gold mine, the Pengjiagou Zone in Pe ngjiagou gold mine, and the #5
Mining Zone, #26 Vein and #3&#7 Vein in Lianhuashan gold mine. After many years of mining,
resources of the mineralised bodies above both #1 Mining Zone o f the Honghuagou gold mine and
#5 Mining Zone of the Lianhuashan gold mine have been depleted.
The ore minerals include native gold, pyrite, chalcopyrite, magnetite, and minor of sphalerite, galena,
chalcocite, bornite, limonite. Gangue minerals include quartz, sericite, chlorite, potassium feldspar,
plagioclase, hornblende, calcite, kaolin. Ore textures include fragmented structure, metasomatic
filling, fine idiomorphic crystal structure and metasomatic res idue. Structures include massive
structure, strip structure, disseminated structure, and breccia structure.
Exploration and Quality Control: The region geological and mineral exploration began in the 1950s
and from then, several phases of exploration work were carried out. The resource and reserve
verification work of Honghuagou-Lianhuashan Mineralisation zone  was undertaken from 2011, the
detailed exploration work on #1 Mining Zone and #86 Vein in Hon ghuagou gold mine, Pengjiagou
gold mine, and #26 Vein and #3&#7 Vein in Lianhuashan gold mine are conducted during the period
from 2011 to 2018.
SRK was provided with the QC data of the #1 Mining Zone, #86 Vein, #5 Mining Zone, #3&#7 Vein,
and Pengjiagou. The sampling preparation, security, and analytical procedures of these mineralised
gold zones/blocks are acceptable. The pass rates of both intern al and external check samples are
acceptable.
SRK's data verification of Huatai project is divided into two parts: one part is Honghuagou gold mine
including #1 mining zone, #86 Vein and Pengjiagou Deposit; the other part is Lianhuashan gold mine
including #3-7 Vein, #26 Vein and #5 mining zone.
A total of 105 verification samples, including 50 pulps from the Honghuagou Mine and 55 pulps from
the Lianhuashan Mine, were chosen randomly to ensure the repres entation and were sent to SGS
Lab for analysis. A large bias was observed between original as say and check results, SRK has
checked with both main laboratory and SGS staff, found that the  sample preparation and sample
assay methods are different, the sample preparation protocol wh ich the original main laboratory
adopted is relatively conservative, they use sieve to remove potential visible gold and then for assay
to minimize the nugget effect, which may lead to a system lower bias compared to SGS using screen
fire assay method. SRK advised to send the samples to umpire laboratory, the Intertek laboratory for
further verification. Based on the returned assay results, a general trend can be observed although
larger biases are found in the higher-grade samples, which may be caused by the nugget effect of
visible gold.
Wulong Project
Geology and Mineralogy: The Wulong project is located in the eastern part of Liaoning province.
The strata in the project region are mainly the Paleoproterozoic Liaohe Group layered metamorphic
rocks, which are sporadically outcropped, mostly in the form of xenoliths remaining in the Mesozoic
– IIIA-31 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS xxix
granites and migmatites distributed over a large area. The stratigraphy of these metamorphic rocks
is composed of Lieryu Formation, Gaojiayu Formation, Dashiqiao Formation, Gaixian Formation and
Quaternary, from the oldest to the newest. Lithologically, thes e rocks consist of various types of
marble, schist and granulite.
The structure in this area is mainly fault structure, and then fold structure. The Yalu River Fault is the
largest fracture zone in the region, which is located at the ed ge of the region and extends in the
northeast direction of 50°-60° and dips to southeast. It is formed by multiple extrusion and shearing.
This fault zone controls the distribution of copper and gold deposits in the region.
The Wulong project area is characterized by intrusions of the P aleoproterozoic biotite granite and
granitelle, early Yanshanian dior ite, granodiorite, granite, an d many dykes accompanying the
intrusions. In the west of the Wulong gold mine, it is the Paleoproterozoic Hongshi biotite granite. In
the south, it is the Yanshanian (i.e., 126 million years ago (“ Ma”)) Sanguliu granodiorite. And in the
north, it is the Yanshanian (112Ma) Dingqishan biotite granite.  They are closely related to gold
Mineralisation.
The Project consists of Wulong gold mine, Ligunzi and Haojingou-Ligunzi gold deposits. The Wulong
gold mine is a large quartz vein type gold deposit. The wall rock is biotite granitite and monzogranite
and the mineralised body is strictly controlled by two groups of faults, the northwest trending and
north-northeast trending faults, consisting of rhombic lattice structure. The mineralised body is within
the nearly north-south, northwest trending compressive torsiona l faults and associated with fine-
grained diorite. The mineralisation type is mainly gold-bearing  quartz vein type, and the useful
components are native gold and silver-gold.
A total of 449 gold-bearing geological bodies were found in the  field, including 382 gold-bearing
quartz veins and 67 silicified alteration zones. Due to years o f mining, only 18 main mineralised
bodies can be mined at present, which can be spatially divided into three ore-forming belts, namely
A, B and C. The mineralised bodies in A and B belts are nearly extending north–south, which are
controlled by granite porphyry veins. The shallow part of the mineralised body is far from the granite
porphyry, the deep part is closer to the granite porphyry, even  directly in the granite porphyry. The
main mineralised body in A belt is the Vein #32, and the main m ineralised bodies are the Veins #2-
3, #2-6, #4-1 and #4-2 in B belt. The mineralised bodies in C belt trend northwest and the main body
is Vein #163.
In the Ligunzi deposit, the mineralised body is vein-like, whic h is controlled by two group faults, the
nearly north-south trending fault, and the northwest trending fault. Generally, the down-dip length is
longer than the strike length. The single vein is stable and has the characteristic of balk reappear,
compound of branch. They are right-sided oblique in the plane a nd slightly forefront in the section.
The maximum extension of mineralised body along strike is up to  600m and the dip length is over
800m, with thickness varying generally from 0.2m to 3.0m.
In the Haojingou-Ligunzi deposit, a total of 20 gold mineralise d bodies and 1 gold low-grade
mineralised body are outlined in Haojingou-Ligunzi area. The strike of mineralised body is northwest,
northeast, or nearly north south and dips to southwest, northwest, southeast, or west with dip angles
from 45° to 80°. They are in the central or edge part of the di orite dyke, granite porphyry, and
sometimes in migmatite. Generally, the mineralised bodies are 37-317m long and 20-225m downdip,
with a width of 0.3-2.46m. The gold grade varies from 1.22 to 40.06g/t.
– IIIA-32 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS xxx
Exploration and Quality Control:  The regional geological and mineral exploration began in the
1960s and from then, several phases of exploration work were carried out. The resource and reserve
verification work of Wulong mine was undertaken in 2019, the de tailed exploration work of Ligunzi
deposit was completed in 2011, and the detailed exploration of Haojingou-Ligunzi deposit was
conducted during the period from 2012 to 2017. Table ES- 6 summaries the engineering’s details in
the three explorations. There is no new geology exploration work since then.
Table ES- 6: Summary of Tre nching, Drilling and Tunnelling
Item Wulong Ligunzi Haojingou-Ligunzi
Trenching/m3 / 506 28,974.53
Surface Drilling/m / 1,097.8 20,026
Underground Drilling/m / / 1,021.9
Tunnelling/m 3,650 308 1,619
Sampling 2,229 400 2,334
We have not received the QC data for Ligunzi deposit. However w e believe the QC data from
Haojingou mining area is somewhat representative of the data qu ality for Ligunzi. The sampling
preparation, security, and analytical procedures of Wulong gold mine and Haojingou-Ligunzi deposit
are acceptable, and the pass rates of both internal and external check samples are acceptable.
SRK's data verification of Wulong project is divided into two p arts: one part is Wulong Mineralised
zone; the other part is Haojingou-Ligunzi Mineralised zone including Haojingou Deposit and Ligunzi
Deposit.
For Wulong Mineralised zone, SRK has performed data verificatio n by taking duplicate samples
during or after site visit. A total of 129 verification samples  were chosen randomly to ensure the
representation. The samples were sent to SGS Mineral Laboratory  located in Tianjin China by
commercial logistic company. The results show that most samples  returned relative deviations
between the original samples and SRK checks of within 20%, which are acceptable.
Jintai Project
Geology and Mineralogy: The Jintai project is located in the eastern edge of the Changdu-Lanping-
Simao block of the Qiangtang-Sanjiang orogenic system and is ad jacent to east of the Diancang –
Yuanlao Mountain metamorphic basement complex of the upper Yang tse paleo platform. Gold
mineralisation in this area is closely related to Himalayan tectonics and alkaline magmatic activities.
The strata outcropped in the project area are Huanglongyan Formation and Shimenguan Formation
of Paleoproterozoic, Jingxing Formation of Cretaceous, Yunlong Formation of Paleogene, Sanying
Formation of Neogene and Quaterna ry. Bed 3 of Member 2 of Sanyi ng Formation are the most
important gold-bearing strata in the area.
The general structure in the area is a syncline fold. It is a subgrade of the Changyi compound syncline
in the region. The core stratigraphy of the syncline is the Mem ber 3 of Sanying Formation, and the
orientation of the axis is about 325°. And it turns to about 35 0° at the West Mountain, and at about
700m northwest of Xidengping village, the direction turns to about 320°. The faults in the mine area
are divided into two groups, one is northwest (“NW”) trending fault, and the other is northeast (“NE”)
– IIIA-33 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Executive Summary    Final
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trending fault.  According to relationship between the two groups of faults, it can be determined that
the NE trending fault is newer than the NW trending fault.
The magmatic rocks in the mining area are mainly in the form of  dikes, including diabase dikes,
diorite dikes and syenite porphyry dikes.
There are regional metamorphism and dynamic metamorphism in the mining area.
Wallrock alteration types mainly  include silicification, pyrite , and kaolinization. There is no obvious
zonation of the alteration. When a variety of hydrothermal alteration is superimposed, the gold grade
is usually higher, and vice versa.
Two mineralised domains within the mining licence area and eigh t mineralised domains in the
exploration permit area are found. The main domains are V1 in the mining licence area and V4, V10
in the exploration permit area.
The gold Mineralised domain V1 is distributed in the northwest of mining licence. It strikes to the
northwest of about 325~340°, dips to the southwest of about 235 ~250° with a dip angle of 6~15°,
has a known strike length of 307m and down-dip extension of 539m. The thickness of the domain
ranges from 2.00 to 25.43m, with an average of 8.90m.  The gold grades range from 0.31g/t to 1.84g/t,
with an average of 0.90g/t.
The gold mineralised domain V4 is distributed in the Tangzibian zone, southern part of the exploration
permit area. It strikes to the northwest of about 330°, dips to  the southwest of 240° with a dip angle
of 2~40°, has a known strike length of about 550m and the down-dip extensions range from 40m to
560m. The thickness of the domain V4 ranges from 0.79 m to 86.76 m, with an average of 22.87m.
Most gold grades range from 0.2g/t to 10 g/t (the maximum is up to 113g/t), with an average of 1.69
g/t.
The mineralised domain V10 is distributed in the Xidengping zon e, northern part of the exploration
permit area. It strikes to the northwest of about 330°, dips to the southwest of about 245° with a dip
angle of 2~12°, has a known strike length of 268m and the down- dip extensions range from
120~410m. The gold grade in V10 gold domain ranges from 0.11g/t to 25g/t, with an average grade
of 2.69g/t.
Exploration and Quality Control: In the mining licence area, the geological exploration has gon e
through three phases, the general exploration was conducted by Shanghai Fuduo from 2007 to 2010,
the exploration for the domain V2 was completed by Shanghai Fud uo from 2012 to 2013 and the
Mineral Resources verification was carried out by Yunnan Yuanhao from 2020 to 2021.
In the exploration licence area, the geological exploration has  included two phases, the exploration
was conducted by Shanghai Fuduo from 2011 to 2017, and the advanced exploration was conducted
by Yunnan Yuanhao from 2020 to 2022. The summary of the exploration workloads is listed in Table
ES- 7
Table ES- 7: Summary Characteri stics of Trenching and Drilling
Item Mining area Exploration area
Trenching/m3 8,158 3,781.6
Drilling/m 2,917.9 11,699.5
– IIIA-34 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS xxxii
Item Mining area Exploration area
Sampling 1,650 9,629
Shanghai Fuduo and Yunnan Yuanhao conducted the sampling in eac h exploration phase
respectively. Samples were prepared and analysed by the laboratory of Kunming Mineral Resources
Supervision and Testing Centre, the 3 rd Geological Brigade of Yunnan Bureau of Geology and
Mineral Resources Exploration and Development according to the Specification of Testing Quality
Management for Geological Laboratories (DZ/T0130-2006).
SRK considers that the sampling preparation, security and analy tical procedures used by Jintai
Mining for Xidengping deposit are acceptable. The pass rates of  both internal and external check
sample are acceptable, while CRMs, duplicate and blank sample were not used in the project.
Hanfeng Project
Geology and Mineralogy: Tectonically, both the Lishan-Xinxing Mining Zone of Tianbaoshan Lead-
Zinc Mine and the Dongfeng Mining Zone of Tianbaoshan Molybdedum-Zinc Mine are located at the
junction of the western edge of Yanbian eugeosyncline fold belt  and Dunhua uplift of Jilin
Eugeosynclinal fold belt. The strata in this project area are m ainly the Palaeozoic Ordovician -
Permian marine carbonate and volcano-sedimentary rock series, a nd the Mesozoic Jurassic
continental volcaniclastic rocks.
The magmatic activity in the proj ect area is strong, mainly sho wing the Hercynian and Yanshan
granites. The area is dominated by fault structures, showing th ree groups of faults in northwest,
north-northwest and northeast directions.
Lishan - Lishan-Xinxing Mining Area co ntains three polymetallic depos its, namely Lishan, Xinxing
and Lishan Plant-Houshan.
The Lishan deposit (below -92m asl) is a zinc-polymetallic deposit dominated by zinc ore, associated
with some copper and lead. The orebodies are lenticular and lenticular like shaped forms. The main
types of wall rock alteration are skarnization, biotitization, kaolinization, sericitization, silicification,
chloritization, epidote, and pyritization. There are 128 zinc-lead-copper mineralised bodies.
The ore minerals are mainly sphalerite and galena, followed by chalcopyrite, pyrite, pyrrhotite,
magnetite, chalcocite, bornite and arsenopyrite. Gangue mineral s are diopside, garnet, epidote,
quartz, calcite, sericite, actinolite and chlorite.
Dongfeng - Dongfeng lead-zinc Mineralisation belt/deposit is mainly loc ated in the skarn
Mineralisation zone formed at fault zone. The mineralised bodie s have been identified in Dongfeng
lead-zinc deposit, all of which belong to polymetallic Mineralisation type. The boundary between the
mineralised body and the surrounding wall rock is unclear and shows a gradual transition relationship.
The molybdenum orebodies (below 250m asl) of the Dongfeng Mine are located within the contact
zones of Early Jurassic diorite granite, Late Triassic quartz d iorite, and fine-grained diorite, as well
as along the surrounding fracture zones of the rock masses. The se orebodies are controlled by the
underlying concealed rock bodies and northwest-trending fault s tructures, resulting in two sets of
northwest-trending molybdenum-bearing quartz vein zones with st eep and gentle dips. The
orebodies appear vein-like or kidney-shaped, arranged parallel to each other, sometimes exhibiting
local contraction and dilation phenomena. The boundaries of the orebodies are defined by samples
– IIIA-35 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS xxxiii
collected near the rock walls. Through deep-level tunnels and d rilling engineering control, a total of
178 molybdenum mineralised bodies of varying sizes have been discovered.
The ore minerals are mainly molybdenite, followed by a small am ount of chalcopyrite, sphalerite,
galena, arsenopyrite, and pyrite. Gangue minerals are quartz, d iopside, chlorite, epidote, zeolite,
calcite, feldspar, biotite.
Exploration and Quality Control:  There is no new geology exploration work of Lishan lead-zinc
mine (above-92m asl) and Dongfeng Mine (above 250m asl) since 2 011, only the annual
consumption and remaining reports of resources and reserves.
Lishan - The deep exploration of Lishan lead-zinc mine (below -92m asl) lasted nine years and one
month from August 2011 to August 2020. The working methods include tunnel geological log, tunnel
hydrogeology, engineering geology, environmental geology survey , tunnel exploration, and drilling.
The basic sampling, infilled sampling, engineering test and exp erimental research are carried out.
By 20 August 2020, a total of 46,351.96 m of drilling and 6,384.80 m of tunnel exploration has been
completed.
Drill holes survey starts from 25m and then every 50m. Spot check of survey results are conducted
regularly at each hole. The maximum deviation distance of borehole bending degree from the design
coordinate is 7.78m. Hole depth is verified every 100m and before drilling completed. The exploration
density of major Mineralised bodies is 20 ~ 135m × 8 ~ 126m. For other mineralised bodies, the
exploration density is 22 ~ 114m × 14 ~ 136m.
The sampling preparation, security and analytical procedures us ed by Hanfeng Mining are
acceptable. The pass rates of both internal and external check sample are acceptable, while CRMs
samples, duplicates and blank samples were not used in the project.
SRK has performed data verification by taking duplicate samples  during or after site visit. A total of
152 verification samples were chosen randomly to ensure the rep resentation. The samples were
sent to SGS Mineral Laboratory located in Tianjin China by commercial logistic company. The results
show that most Cu and a majority of Lead and Zinc samples retur ned relative deviations between
the original samples and SRK checks of within 20%, which are acceptable.
Dongfeng - The exploration programme of the Dongfeng Molybdenum Mine (below 250m ASL) was
conducted from December 2013 to 28 February 2023, including geo logical mapping in tunnels, as
well as tunnel exploration and drilling. The exploration depth ranged from 250 meters to -600 meters.
A total of 3611.9m drilling and 3499.54m of tunnel exploration from 2013 to 2017 and totalling
82,101.16 m drilling and 1207.80m of tunnel exploration from 2019 to 2023 were conducted.
The sampling preparation, security and analytical procedures us ed by Hanfeng Mining are
acceptable. The pass rates of both internal and external check sample are acceptable, while CRMs
samples, duplicates and blank samples were not used in the project.
SRK has performed data verification by taking duplicate samples  during or after site visit. A total of
189 verification samples were chosen randomly to ensure the rep resentation. The samples were
sent to SGS Mineral Laboratory located in Tianjin China by commercial logistic company. The results
show that most Mo samples returned relative deviations between the original samples and SRK
checks of within 20%, which are acceptable.
– IIIA-36 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS xxxiv
Mineral Resources Estimation
The Mineral Resource Statement presented herein represents the Mineral Resource estimation
prepared for the Chifeng Gold Project in accordance with the JORC Code. The effective date of the
Mineral Resource statement is 30 September 2024.
The database used to estimate the Jilong, Huatai and Wulong  Projects Mineral Resources was
audited by SRK. Surpac 2020 software was used by SRK to create the grade solids, prepare assay
data for analysis, construct the block model, estimate gold grades, and tabulate Mineral Resources.
The final model was prepared by SRK using conventional 3D model ling and ID2 estimation
techniques.
Table ES- 8 presents a summary of the estimated Mineral Resources in compliance with the JORC
Code for the Jilong Project, as of 30 September 2024 and using a gold cut-off grade of 1.5g/t.
Table ES- 8: Mineral Resource Statement for the Jilong Project, as of 30 September 2024
Mineralised
Zone/Block Category Tonnage Grade Au Metal
Contained
Au Metal
Contained
(kt) (Au g/t) (t)  (koz)
Zhuanshanzi #1#
2#3&depth
Measured 299 9.21 2.76 89
Indicated 282 7.24 2.04 66
Measured + Indicated 581 8.25  4.80   154
Inferred 433 8.56 3.71 119
Zhuanshanzi
#4#5#6#&#7
Measured 184 17.04 3.14 101
Indicated 142 13.27 1.88 60
Measured + Indicated 326 15.40 5.02 161
Inferred 75 13.16 0.99 32
Total
Measured 484 12.19 5.90 190
Indicated 424 9.25 3.92 126
Measured + Indicated 907 10.82 9.82 316
Inferred 508 9.24 4.70 151
Notes:
1 All figures are rounded to reflect the relative accuracy of the estimate. All composites have been capped where appropriate;
2 The information in this report which relates to Mineral Resourc e is based on information co mpiled by Mr. Mingyan Wang
and Dr. Yiefei Jia who are full time employees of SRK Consulting China, Dr. Jia is a Fellow of AusIMM (No. 230607) and a
Chartered Professional in Geology (CP Geo). Dr. Jia and Mr. Wang have sufficient experience which is relevant to the style
of mineralisation and the type of deposits under consideration and to the activity which they are undertaking to qualify as
the Competent Persons as defined in the 2012 edition of the “Australasian Code for Reporting of Exploration results, Mineral
Resources and Ore Reserves”, the JORC Code. Dr. Jia and Mr. Wan g consent to the reporting of this information in the
form and context in which it appears; and
3 The cut-off grade is 1.5g/t Au.
Table ES- 9 presents a summary of the estimated Mineral Resources in compliance with the JORC
Code for the Huatai Project, as of 30 September 2024 and using a gold cut-off grade of 1.5g/t.
– IIIA-37 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS xxxv
Table ES- 9: Mineral Resources Statement for the Huatai Project , as of 30 September 2024
Mineralized Zone/Block Category Tonnage
(kt)
Au Grade
(g/t)
Au Metal
Contained (t)
Au Metal
Contained (koz)
Honghuagou #1 Mining
Zone
Measured 251  6.21 1.56 50.1
Indicated 759  6.48 4.92 158.1
Measured +
Indicated 1,011  6.41 6.48 208.2
Inferred 419  5.87 2.46 79.2
Honghuagou #86 Vein
Measured - - - -
Indicated 315  5.30 1.67 53.7
Measured +
Indicated 315  5.30 1.67 53.7
Inferred 103  5.34 0.55 17.7
Honghuagou Pengjiagou
mine
Measured - - - -
Indicated 338  5.36 1.81 58.3
Measured +
Indicated 338  5.36 1.81 58.3
Inferred 148  5.88 0.87 28.0
Lianhuashan #5 Mining
Zone
Measured 134  5.28 0.71 22.7
Indicated 109  8.00 0.87 28.0
Measured +
Indicated 243  6.50 1.58 50.7
Inferred 148  5.88 0.87 28.0
Lianhuashan #26 Vein
Measured - - - -
Indicated 217  9.54 2.07 66.5
Measured +
Indicated 217  9.54 2.07 66.5
Inferred 135  9.34 1.26 40.6
Lianhuashan #3-7 Vein
Measured - - - -
Indicated 408  10.46 4.27 137.1
Measured +
Indicated 408  10.46 4.27 137.1
Inferred 328  8.61 2.82 90.7
Total
Measured 385  5.88 2.27 73
Indicated 2,146  7.27 15.60 502
Measured +
Indicated 2,531  7.06 17.87 575
Inferred 1,281  6.90 8.83 284
Notes:
1 All figures are rounded to reflect the relative accuracy of the estimate. All composites have been capped where appropriate;
2 The information in this report which relates to Mineral Resource is based on information compiled by Mr. Huaixiang Li, Ms.
Yanfang Zhao and Dr. Yiefei Jia who are full time employees of SRK Consulting China, Mr. Li is member of AIG, Ms. Zhao
is member of AusIMM and Dr. Jia is a Fellow of AusIMM (No. 230607) and a Chartered Professional in Geology (CP Geo).
They have sufficient experience which is relevant to the style of mineralisation and the type of deposits under consideration
and to the activity which they are undertaking to qualify as th e Competent Persons as defined in the 2012 edition of the
“Australasian Code for Reporting of Exploration results, Minera l Resources and Ore Reserves”, the JORC Code. They
consent to the reporting of this information in the form and context in which it appears; and
3 The cut-off grad is 1.5g/t Au.
Table ES- 10 presents a summary of the estimated Mineral Resources in compliance with the JORC
Code for the Wulong Project, as of 30 September 2024 and using a gold cut-off grade of 1.5g/t.
– IIIA-38 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS xxxvi
Table ES- 10: Mineral Resource Statement for the Wulong Project, as of 30 September 2024
Mineralised Zone/Block Category Tonnage
(kt)
Au Grade
(g/t)
Au Metal
Contained (t)
Au Metal
Contained
(koz)
Wulong
Measured - - - -
Indicated 997 8.88 8.85 285
Measured +
Indicated 997 8.88 8.85 285
Inferred 1,371 7.39 10.15 326
Ligunzi
Measured - - - -
Indicated 126 5.16 0.65 21
Measured +
Indicated 126 5.16 0.65 21
Inferred 99 5.36 0.53 17
Haojingou-Ligunzi
Measured - - - -
Indicated 138 5.74 0.8 26
Measured +
Indicated 138 5.74 0.80 26
Inferred 268 6.73 1.85 59
Total
Measured - - - -
Indicated 1,261 8.17  10.30 332
Measured +
Indicated 1,261 8.17  10.30 332
Inferred 1,738 7.21  12.53 402
Notes:
1 All figures are rounded to reflect the relative accuracy of the estimate. All composites have been capped where appropriate.
2 The information in this report which relates to Mineral Resource is based on information compiled by Mr. Huaixiang Li, Mr.
Shaobo Dai and Dr. Yiefei Jia who are full time employees of SRK Consulting China, Mr. Li is a member of AIG and Dr. Jia
is a Fellow of AusIMM (No. 230607) and a Chartered Professional  in Geology (CP Geo). They have sufficient experience
which is relevant to the style of mineralisation and the type o f deposits under consideration and  to the activity which they
are undertaking to qualify as the Competent Persons as defined in the 2012 edition of the “Australasian Code for Reporting
of Exploration results, Mineral Resources and Ore Reserves”, th e JORC Code. Mr. Li and Dr. Jia consent to the reporting
of this information in the form and context in which it appears.
3 The cut-off grad is 1.5 g/t Au.
The database used to estimate the Jintai Project Mineral Resources was audited by SRK. Surpac
2020 software was used by SRK to create the grade solids, prepare assay data for analysis, construct
the block model, estimate gold grades, and tabulate Mineral Resources.
Table ES- 11 presents a summary of the estimated Mineral Resources in compliance with the JORC
Code for the Jintai Project, as of 30 September 2024 and using a gold cut-off grade of 0.17g/t.
Table ES- 11: Mineral Resource Statement for the Jintai project, as of 30 September 2024
Mineralised Zone/Block Category Tonnage
(kt)
Au Grade
(g/t)
Au Metal
Contained (t)
Au Metal
Contained
(koz)
Xidengping
Measured 3,363  1.68  5.64  181
Indicated 4,604  1.02  4.70  151
Measured +
Indicated 7,967  1.30  10.33  332
Inferred 2,699  1.29  3.49  112
Notes:
1 All figures are rounded to reflect the relative accuracy of the estimate. All composites have been capped where appropriate.
– IIIA-39 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Executive Summary    Final
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2 The information in this report which relates to Mineral Resource is based on information compiled by Mr. Huaixiang Li, Mr.
Shaobo Dai and Dr. Yiefei Jia who are full time employees of SRK Consulting China, Mr. Li is a member of AIG and Dr. Jia
is a Fellow of AusIMM (No. 230607) and a Chartered Professional  in Geology (CP Geo). They have sufficient experience
which is relevant to the style of mineralisation and the type o f deposits under consideration and  to the activity which they
are undertaking to qualify as the Competent Persons as defined in the 2012 edition of the “Australasian Code for Reporting
of Exploration results, Mineral Resources and Ore Reserves”, th e JORC Code. They consent to the reporting of this
information in the form and context in which it appears.
3 The cut-off grad is 0.17g/t Au.
For the Hanfeng Project, both Lishan and Dongfeng mines have long mining history, and SRK has
only been provided the detailed data of the deep area (below -9 2m asl) of Lishan Mine and deep
area of Dongfeng Molybdenum Deposit (below 250m asl), which mea ns that only the Mineral
Resources in deep areas can be reported.
According to a conceptual calculation, SRK considers that the b locks not below a cut-off grade of
0.50% Zn show “reasonable prospects for eventual economic extraction” for the deep area of Lishan
underground mine and can be reported as Mineral Resource, and that the blocks not below a cut-off
grade of 0.03% Mo show “reasonable prospects for eventual economic extraction” for the deep area
of Dongfeng underground mine and can be reported as Mineral Resource.
As of 30 September 2024, of the estimated Mineral Resources of Lisha Mine in compliance with the
JORC Code for the Hanfeng Project are shown in Table ES- 12.
Table ES- 12: Mineral Resource Statement for the Lishan Mine, as of 30 September 2024
Mineralised
Zone/Block Category Tonnage
(kt)
Zn
Grade
(%)
Zn Metal
Contained
(kt)
Cu
Grade
(%)
Cu Metal
Contained
(kt)
Pb
Grade
(%)
Pb Metal
Contained
(kt)
Lishan
Measured 752 2.36 18 0.01 0  0.12 1
Indicated 8,583 2.66 229 0.07 6  0.12 10
Measured
+
Indicated
9,335 2.64 246 0.06 6  0.12 11
Inferred 10,616 2.9 308 0.09 10  0.13 14
Notes:
1 All figures are rounded to reflect the relative accuracy of the estimate.
2 The information in this report which relates to Mineral Resource is based on information compiled by Ms. Yanfang (Bonnie)
Zhao and Dr. Yiefei Jia who are both full time employees of SRK  Consulting China, Ms. Zhao is a member of AusIMM and
Dr. Jia is a Fellow of AusIMM (No. 230607) and a Chartered Professional in Geology (CP Geo). Dr. Jia and Ms. Zhao have
sufficient experience which is relevant to the style of mineralisation and the type of deposits under consideration and to the
activity which they are undertaking to qualify as the Competent Persons as defined in the 2012 edition of the “Australasian
Code for Reporting of Exploration results, Mineral Resources an d Ore Reserves”, the JORC Code. Ms. Zhao and Dr. Jia
consent to the reporting of this information in the form and context in which it appears.
3 Within mining license area and below -92m asl.
As of 30 September 2024, of the estimated Mineral Resources of Dongfeng Mine in compliance with
the JORC Code for the Hanfeng Project is shown in Table ES- 13.
Table ES- 13: Mineral Resource Statement for the Dongfeng Mine, as of 30 September 2024
Mineralised
Zone/Block Category Tonnage (kt) Mo Grade (%) Mo Metal
Contained (kt)
Dongfeng Measured 1,819 0.11  2
Indicated 26,495 0.12  32
– IIIA-40 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS xxxviii
Mineralised
Zone/Block Category Tonnage (kt) Mo Grade (%) Mo Metal
Contained (kt)
Measured +
Indicated 28,314 0.12 34
Inferred 37,053 0.12  45
Notes:
1 All figures are rounded to reflect the relative accuracy of the estimate.
2 The information in this report which relates to Mineral Resource is based on information compiled by Ms. Yanfang (Bonnie)
Zhao and Dr. Yiefei Jia who are both full time employees of SRK  Consulting China, Ms. Zhao is a member of AusIMM and
Dr. Jia is a Fellow of AusIMM (No. 230607) and a Chartered Professional in Geology (CP Geo). Dr. Jia and Ms. Zhao have
sufficient experience which is relevant to the style of mineralisation and the type of deposits under consideration and to the
activity which they are undertaking to qualify as the Competent Persons as defined in the 2012 edition of the “Australasian
Code for Reporting of Exploration results, Mineral Resources an d Ore Reserves”, the JORC Code. Ms. Zhao and Dr. Jia
consent to the reporting of this information in the form and context in which it appears.
3 Within mining license area and below 250m asl.
Ore Reserves Estimation
SRK estimated the Ore Reserves for the Chifeng Gold’s mines in accordance with the JORC Code
guidelines and based on each mine’s mining recovery rate and dilution rate as well as other modifying
factors cited either from the hi storical mining records, the pr efeasibility or feasibility study, and/ or
mine designs. The following table summarises the estimated Ore Reserves of the Jilong, Huatai,
Wulong, Jintai and Hanfeng projects, with an effective date 30 September 2024.
As of 30 September 2024, the total Ore Reserve for the Jilong Project is estimated at 919 kt at an
average grade of 8.73g/t Au, containing 8.02 t of gold. This in cludes the Proved Ore Reserve
estimated at 510 kt at an average grade of 9.81g/t Au, containi ng 5.00 t of gold, and the Probable
Ore Reserve estimated at 409 kt at an average grade of 7.38g/t Au, containing 3.02 t of gold (see
Table ES- 14).
Table ES- 14: Ore Reserve Statement for the Jilong Project, as of 30 September 2024
Reserve Category Tonnage (kt) Au Grade (g/t) Au Metal Contained  (t) Au Metal Contained (koz)
Proved 510 9.81 5.00 161
Probable 409 7.38 3.02 97
Total 919 8.73 8.02 258
Sources: SRK
Notes:
1 The information relates to Ore Reserve conversion is based on information compiled by Ms. Tzuhsuan Chuang, MAusIMM
and Dr. Yiefei Jia, FAusIMM (CP Geo), who are full time employees of SRK Consulting China Ltd. Both Ms. Chuang and
Dr. Jia have sufficient experience which is relevant to the style of mineralisation and the type of deposits under consideration
and to the activity which they are undertaking to qualify as th e Competent Person as defined in the 2012 edition of the
“Australasian Code for Reporting of Exploration results, Minera l Resources and Ore Reserves”, the JORC Code. Ms.
Chuang and Dr. Jia consent to the reporting of this information in the form and context in which it appears;
2 The Ore Reserves Statement is based on the depletion data provided by Jilong Mine for the six-month period, 1 April 2024
to 30 September 2024. The reported Jilong Mine data may differ from that reported by SRK, due the updated Block model
now used by Jilong Mine for reporting. SRK considers this updat ed block model to be more representative of actual
production conditions and has therefore adopted the Jilong Mine provided data as the basis for this statement.
3 Ore Reserve are estimated at a cut-off grade of 2.76g/t Au; and
4 Number was rounded to the second significant digit, and total may not add due to rounding discrepancies.
As of 30 September 2024, the Huatai Project contains a total Ore Reserves of 1,694kt at an average
grade of 6.20g/t Au, containing 10.50t of gold, which includes the Proved Ore Reserves of 226kt at
– IIIA-41 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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an average grade of 5.21g/t Au, containing 1.18t of gold, and the Probable Ore Reserves of 1,468kt
at an average grade of 6.35g/t Au, containing 9.32t of gold (see Table ES- 15).
Table ES- 15: Huatai Project Underground Ore Reserve Statement, as of 30 September 2024
Reserve Category Tonnage (kt) Au Grade (g/t) Au Metal Contained  (t) Au Metal Contained (koz)
Proved 226 5.21 1.18 38
Probable 1,468 6.35 9.32 300
Total 3 1,694 6.20 10.50 338
Sources: SRK
Notes:
1 The information relates to Ore Reserve conversion is based on i nformation compiled by Mr. Erwei Lu and Dr. Yiefei Jia,
FAusIMM (CP Geo), who are full time employees of SRK Consulting China Ltd. Both Dr. Jia and Mr Lu have sufficient
experience which is relevant to the style of mineralisation and  the type of deposits under consideration and to the activity
which they are undertaking to qualify as the Competent Person as defined in the 2012 edition of the “Australasian Code for
Reporting of Exploration results, Mineral Resources and Ore Reserves”, the JORC Code. Mr Lu and Dr. Jia consent to the
reporting of this information in the form and context in which it appears;
2 Ore Reserve are estimated at a cut-off grade of 2.93g/t Au; and
3 Number was rounded to the second significant digit and total may not add due to rounding discrepancies.

As of 30 September 2024, the total Ore Reserve for the Wulong Project is estimated at 984 kt at an
average grade of 7.30g/t Au, containing 7.19 t of gold (see Table ES- 16).
Table ES- 16: Ore Reserve Statement for the Wulong Project, as of 30 September 2024
Reserve Category Tonnage (kt) Au Grade (g/t) Au Metal Contained  (t) Au Metal Contained (koz)
Proved - - -
Probable 984 7.30 7.19 231
Total 3 984 7.30 7.19 231
Sources: SRK
Notes:
1 The information relates to Ore Reserve conversion is based on information compiled by Ms. Tzuhsuan Chuang, MAusIMM
and Dr. Yiefei Jia, FAusIMM (CP Geo), who are full time employees of SRK Consulting China Ltd. Both Ms. Chuang and
Dr. Jia have sufficient experience which is relevant to the style of mineralisation and the type of deposits under consideration
and to the activity which they are undertaking to qualify as th e Competent Person as defined in the 2012 edition of the
“Australasian Code for Reporting of Exploration results, Minera l Resources and Ore Reserves”, the JORC Code. Ms.
Chuang and Dr. Jia consent to the reporting of this information in the form and context in which it appears;
2 The Ore Reserves Statement is based on the depletion data provided by Wulong Mine for the six-month period, 1 April 2024
to 30 September 2024. The reported Wulong Mine data may differ from that reported by SRK, due the updated Block model
now used by Wulong Mine for repor ting. SRK considers this updat ed block model to be more representative of actual
production conditions and has therefore adopted the Wulong Mine provided data as the basis for this statement.
3 Ore Reserve are estimated at a cut-off grade of 2.50/t Au; and
4 Number was rounded to the second significant digit and total may not add due to rounding discrepancies.

As of 30 September 2024, the Jintai Project (V1&V2) contains the Probable Ore Reserves of 1,370kt
at an average grade of 0.75g/t Au, containing 1.03t of gold (see Table ES- 17).
Table ES- 17: Ore Reserve Statement for the Jintai Project, as of 30 September 2024
Reserve Category Tonnage (kt) Au Grade (g/t) Au Metal Contained  (t) Au Metal Contained (koz)
Proved  -     -     -     -
Probable  1,370   0.75   1.03   33
– IIIA-42 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS xl
Reserve Category Tonnage (kt) Au Grade (g/t) Au Metal Contained  (t) Au Metal Contained (koz)
Total  1,370   0.75   1.03   33
Sources: SRK
Notes:
1 The information relates to Ore Reserves conversion is based on information compiled by Mr. Erwei Lu and Mr Falong Hu,
FAusIMM, who are full time emplo yees of SRK Consulting China Lt d. Both Mr Lu and Mr Hu have sufficient experience
which is relevant to the style of mineralisation and the type o f deposits under consideration and  to the activity which they
are undertaking to qualify as the Competent Person as defined i n the 2012 edition of the “Australasian Code for Reporting
of Exploration results, Mineral Resources and Ore Reserves”, th e JORC Code. Mr Lu and Mr Hu consent to the reporting
of this information in the form and context in which it appears;
2 Ore Reserve are estimated at a cut-off grade of 0.25g/t Au;
3 Number was rounded to the second significant digit and total may not add due to rounding discrepancies; and
4 The Ore Reserves Statement is based on the depletion data provi ded by Jintai for the six-month period, 1 April 2024 to 30
September 2024. The reported Jintai data may differ from that reported by SRK, due the updated block model now used by
Jintai for reporting. SRK considers this updated block model to be more representative of actual production conditions and
has therefore adopted the Jintai provided data as the basis for this statement.

As of 30 September 2024, the Hanfeng Project (Lishan Lower Part - Stage1) contains a total Ore
Reserves of 3,310kt at an average grade of 2.45% Zn, containing 81kt of Zn, which includes Proved
Ore Reserves estimated of 390 kt  at an average grade of 2.26% Z n, containing 9kt of Zn, and
Probable Ore Reserves of 2920 kt at an average grade of 2.47% Zn, containing 72 kt of Zn (see
Table ES- 18).
Table ES- 18: Ore Reserve Statement for the Hanfeng Project, as of 30 September 2024
Reserve Category Tonnage (kt) Zn Grade (%) Zn Metal Contained (kt)
Proved 390 2.26 9
Probable 2,920 2.47 72
Total 3,310 2.45 81
Sources: SRK
Notes:
1 The information relates to Ore Reserve conversion is based on i nformation compiled by Mr. Erwei Lu and Dr. Yiefei Jia,
FAusIMM (CP Geo), who are full ti me employees of SRK Consulting  China Ltd. Both Dr. Jia and Mr Lu have sufficient
experience which is relevant to the style of mineralisation and  the type of deposits under consideration and to the activity
which they are undertaking to qualify as the Competent Person as defined in the 2012 edition of the “Australasian Code for
Reporting of Exploration results, Mineral Resources and Ore Reserves”, the JORC Code. Mr Lu and Dr. Jia consent to the
reporting of this information in the form and context in which it appears;
2 Ore Reserve are estimated at a cut-off grade of 1.4% Zn; and
3 Number was rounded to the second significant digit and total may not add due to rounding discrepancies.
Mining Assessment
Jilong Project
Zhuanshanzi Mine currently has three stand-alone underground operating systems: Zone 1, Zone 2
and Zone 3. Zone 1 is located on the southwest side of the mine, including No. 27 area and Yangpo
area. Zone 2 is located on the north side of Zone 1. Zone 3 is located on the east side of Zone 1.
The Zhuanshanzi Mine intends to increase its production capacity by developing peripheral Zones 4,
5, 6, and 7. This expansion is projected to commence operations  in 2027, with an expected
production rate of 60 thousand tonnes per annum (“ktpa”). The LoM is expected to be 9 years.
– IIIA-43 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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All of these zones are utilizing an underground mining method, accessing the orebodies via shafts
or adits.
The resuing mining method is used in the Zhuanshanzi Mine, wher e the orebodies are very steep
and thin with solid surrounding rocks. This mining method enabl es the separation of the ore and
surrounding rocks, with the ore being transported and extracted while the waste is kept in the stope
for backfilling. The mining dilution is 16-17% and the ore loss is 5%.
The stope's length is 50m and its height is 40-45m. Wooden hopp er is used, and the ore is
transported manually. The distance between hoppers is 10m, the sill pillar is 3m, and no other pillar
is left. There are raises beside the stope, and the section of the raise is 2.0m x 1.5m. The drift is
about 2.4m x 2.5m depending on the ore body.
Huatai Project
Huatai Project includes six (6) gold mines, each with an independent development system. They are
all utilizing or planning conventional underground mining metho dologies, access via adit & shaft or
incline shaft, resuing stoping me thod, railway ore car transpor tation. Huatai Project operation and
plan status are described as follows:
 Pengjiagou Mine: this mine has planned to modify the mining system to achieve the capacity of
40ktpa from the previous 30ktpa. The client conducted a preliminary design on this mine, decided
to commend its expansion in 2028.
 Honghuagou #86 Vein: this mine has planned to modify the mining  system to achieve the
capacity of 40ktpa from the previous 30ktpa. The client decided  to commend its production in
2028.
 Honghuagou #1 Mining Zone: this mine contained 4 sub-zones with  their own mining license,
which are #1 vein, #3 sub-zone, #1 sub-zone, and Longtoushan. The mine has planned to modify
mining system to achieve the capacity of 60ktpa from the previo us 38.9ktpa.  The client
conducted a preliminary design on these sub-zones, decided to commend its production in 2027.
 Lianhuashan #26 Vein: this mine has planned to modify mining sy stem to achieve the capacity
of 40ktpa from the previous 30ktpa. The client conducted a prel iminary design on this mine,
decided to commend its expansion in 2028.
 Lianhuashan #3&#7 Vein: this mine has planned to modify mining system to achieve the capacity
of 60ktpa from the previous 30k tpa. The client conducted a scop ing studies and preliminary
design on this mine, decided to commend its production in 2027.
 Lianhuashan #5 Mining Zone: this mine has decided to modify min ing system to achieve the
capacity of 60ktpa from the previous 30ktpa. The client conduct ed a preliminary design on this
mine, decided to commend its production in 2026.
Additionally, Huatai Mine has planned to integrate Lianhuashan #5 Mining Zone and Lianhuashan
#26 Vein to a capacity of 100ktpa, as well as the integration o f Honghuagou #1 Mining Zone and
Pengjiagou Mine to a capacity of 100 kpta. The expansion is cur rently in progress, with a defined
plan and budget in place.
A modified resuing stoping method is adopted by Huatai Mining. The stoping method is suitable for
the veins horizontal thickness being less than 0.8m. The modify ing point from traditional resuing is
the rock sourced out of stope partly, not all from surrounding rock mined down.
– IIIA-44 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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The stope length is about 50 to 100m and the height is the same as level interval. There are no crown
pillar or rib pillar planned, and the sill pillar is proposed f or draw point installation and separation
stopes. The square-set raise for manway is planned at each end of stope. The draw points interval
is about 10m from centre to centre.
The average mining dilution rate is 20% and the ore loss is 15%. The LoM is expected to be 28 years.
Wulong Project
Wulong Mine currently has three stand-alone underground operating systems: Zone 2, Zone 3, and
Zone 4. Zone 4 is further separated into the main shaft zone an d the service shaft zone, and the
latter is also known as Zone 5.
The development system is shafts and blind shafts. Shafts are b eing used for transporting ore and
waste and personnel. Development to access these stope blocks is designed years in advance.
For steep and thin orebody with solid surrounding wall rocks, t he resuing method is adopted to
separate the ore and surrounding rocks, with the ore being transported and extracted while the waste
is kept in the stope for backfilling.
For relatively thicker orebody, the overhand cut and fill minin g is adopted. The cut and fill mining
allows selective mining, separate recovery of high-grade portions, and stope retention of low-grade
rock. Excavated voids are backfilled with waste rock once the stope has been mined out. This method
provides a relatively inexpensive and convenient way to advance a working platform in order to keep
access to the ore for drilling, blasting, and mucking.
The average mining dilution rate is 15% and the ore loss is 8%. The LoM is estimated to be 12 years
with an expected production rate of 100ktpa.
Jintai Project
Jintai Mining obtains one mining license and one exploration license for the Xidengping Mine. Based
on the geological characteristics, a total of nine (9) mineralised bodies, named V1, V2 (V2-1 and V2-
2), V4, V5, V6, V7, V8, V9 and V10, were delineated, but only V 1, V2, V4 and V10 contain the
Measured and Indicated Mineral Resources.
Several technical studies on the mineralised bodies V1 and V2 within the mining license have been
conducted since they obtained the mining license in 2012. Therefore, only V1 and V2 have the Ore
Reserves. SRK has received and reviewed the following studies:
 Preliminary Design for Xidengping Mine with a capacity of 140kt pa conducted by JinJian
Engineering Design Co., Ltd (“GOCOM”) in February 2022 (hereafter referred to as “FS 2022”),
and
 Mineral Resources Development and Utilisation Scheme for Xidengping Mine with a capacity of
650ktpa conducted by Yunnan Shangli Mining Co., Ltd. (“ Shangli”) in March 2024 (hereafter
referred to as “FS 2024”).
They initialled mine and plant construction for the V1 and V2 at the beginning of 2023. The designed
mining and processing capacity is 140ktpa. The mine is proposed  for surface mining via free dig –
transportation – heap leaching methodology. The LoM is about 12  years including one-year mine
construction period, as the FS 2022 proposed.
– IIIA-45 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
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The average mining dilution rate is 5% and the ore loss is 5%.
After review FS 2022 and discussed with mine management, SRK opines that the mine is well studied,
and the mining method is technically reasonable and feasible. T he risk on mining operation is low,
as the method employed is common and practical. However, the pit optimization along with pit design,
as well as cut-off grade definition could be updated when considering the JORC Code estimates.
Also, the Client is applying for another one mining licence for the exploitation of V4 and V10 with a
capacity of 650ktpa based on the FS 2024 and the application is in process.
Hanfeng Project
Hanfeng Mining operate 2 established mines, the Lishan Mine and  Dongfeng Mine. They are both
utilizing conventional underground mining methodologies, access via adit & shaft, shrinkage stoping
method, railway ore car transpo rtation. There are 2 processing plants which located in Lishan and
Dongfeng, respectively. The Li shan Plant deals with zinc, lead,  and copper resources and the
Dongfeng Plant processes molybdenum feeds. The infrastructure a t both mines is established and
the risk of shortage of power, water, fuel and other materials is low.
The operating status of the Hanfeng Project is described as followings:
Lishan Mine
 Lishan Mine is divided into 2 parts in vertical.
 The upper part which is above -92m asl, is operated at a nomina ted capacity of 165 ktpa run of
mine (“ROM”) containing zinc, lead, and copper elements, feedin g the Lishan plant. The upper
part is currently in operation to mine the historically residua l inventory. The upper part is not
within the scope of the Ore Reserve estimation.
 The lower part, which is from -92m asl to -700m asl, is planned to construct in 2 stages.
 Stage I is targeting the Mineral Resource from -92m asl down to -373m asl. Stage I is proposed
at a capacity of 435ktpa, operat ing with upper part together to  achieve 600ktpa capacity. The
construction of Stage I is currently on progress (as of September 2024). The main shaft has been
developed but not equipped due to ventilation shaft and return air drift is on development.
 Stage II will focus on the Mineral Resource under -373m asl, downwards to -700m asl. The Client
aims to achieve 600ktpa capacity . However, the technical studie s and/or design on this stage
has not initiated yet.
Dongfeng Mine
 Dongfeng Mine is also divided into two parts in vertical, and t he intersection elevation is 250m
asl.
 The upper part is on operating at the south section and north section
 South section contains the mineralisation veins of zinc, lead, and copper. The mined ore of this
section is trucked to the Lishan Plant for treatment. It is expected that this section resource would
maintain a mining plan of 60ktpa for the next three years.
 North section contains veins of moly element. This section was on care and maintenance before
2022. In 2022 this section was re-operated at 6 ktpa ROM. The D ongfeng Plant was also re-
– IIIA-46 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Executive Summary    Final
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operated to treat this 6 ktpa ROM and 9k ore from surface stockpile, which was stored for nearly
10 years.
 The lower part is for the North section which is moly resources. The lower part Mineral Resources
have been estimated but have not c onverted them into Ore Reserv es yet due to a lack of a
technical study currently.
Based on the historical mining production records in 2021, the mining dilution rate of 22% and ore
loss of 20% on average, which is considered the comparation of resource depletion against run of
mine.
Based on the remaining Ore Reserves of the Lishan Mine, the LoM  is estimated to be 8 years. The
peak mining rate is 450ktpa.
Metallurgical and Processing Assessment
Jilong Metallurgical Plant
Jilin Institute of Geological Sciences conducted a laboratory processing testwork on the Zhuanshanzi
ore in 2018.
The gold grade of the composite sample is 10.20g/t and the silver grade is 45.32g/t. After grinding to
-0.074 mm accounting for 70% (P 70=74μm), the sample is subjected to flotation tests. The test
flowsheet is a closed circuit of “one roughing, two cleanings a nd two scavengings” to obtain gold
concentrate. The final concentrate has a gold grade of 147.78g/t and a gold recovery of 95.05%, and
a silver grade of 554.34g/t and a silver recovery of 80.25%. The test shows that the flotation process
can be used to obtain desirable indexes for the ore of Zhuanshanzi gold mine. Nevertheless, Jilong
Metallurgical Plant has not adopted the flotation method but whole ore cyanidation, as the whole ore
cyanidation can produce gold bullion on site.
The Project has two processing plants, #1 Jilong Plant is the original 400tpd plant and #2 Jilong Plant
is the new 600tpd plant. The #2 Jilong plant was put into opera tion in May 2024 and has already
reached its designed capacity, thus the two plants can achieve a total production capacity of 1,000tpd
(300,000 tpa). Both plants adopt the same process of whole ore cyanidation, with the final product
being gold ingot. The gold recovery rate for the Jilong Plant reaches over 96%. Table ES- 19 shows
the historical production indexes of Jilong two processing plants.
Table ES- 19:  Historical Production Index of Jilong Plant
Item Unit 2021 2022 2023 2024 Q1-Q3 1
ROM throughput kt 143.7 152.7 152.6 168.0
Feed grade g/t 7.51 5.52 9.33 4.88
Gold recovery % 97.08  96.17 97.66 96.52
Gold ingot output 2 kg 1,048 811 1,390 795
Notes:
1 The data include the historical index of 2024Q1-Q3 of the #1 Jilong Plant and the index from May to September 2024 of the
#2 Jilong Plant.
2 The gold ingot output in the table does not include the gold me tal which is recovered from gold-bearing materials, cyanide
slag smelting, etc.
– IIIA-47 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Huatai Metallurgical Plant
Huatai Mining commissioned the mineral experimental research institute of Inner Mongolia
Autonomous Region to conduct a laboratory process test study on ore processing in 2017.
The gold grade of test sample is 6.22g/t, after grinding to -0.074mm accounted for 85% (P85=74μm),
a closed flotation circuit of “one roughing, two cleanings and two scavengins” was adopted to obtain
gold concentrate. The final concentrate has a gold grade of 149.31g/t and gold recovery of 95.06%,
indicating the ore is ameable to flotation. However, Huatai Metallurgical Plant did not adopt flotation
but carbon-in-pulp (“CIP”) method for obtaining gold bullion on site.
The Huatai Metallurgical Plant with a processing capacity of 20 0tpd (60ktpa) was built in 1987. A
traditional CIP process was adopted to produce gold mud as the final product, which is then sent to
the metallurgical plant of Jilong Mining to produce gold ingots  for sale. Table ES- 20 shows the
historical production indexes of the Huatai Metallurgical Plant . The ore supply has been seriously
reduced due to mining renovation in 2022 and 2023, resulting in the plant out of running frequently.
Until now, the processing plant is out of operation so there is no production record in 2024.
Table ES- 20: Historical Production Index of Huatai Metallurgical Plant
Items Unit 2021 2022 2023
Processing throughput kt 58.51 19.12 1.62
Feed grade g/t 2.42 2.69 2.43
Gold recovery % 93.75 93.41 92.80
Gold output in ingot kg 132.75 48.02 3.65

Wulong Processing Plant
In 2021, Wulong Mining commissioned BGRIMM Technology Group to carry out a mineral
processing test on the Wulong gold ore.
The closed-circuit comparative tests were carried out on three flotation processes: “on-site process”
(one roughing, three scavengings and three cleanings), “two roughings, two scavengings and three
cleanings” and “stage flotation (two products) process”. The gold grade of the composite sample is
3.51g/t.
The test results showed that the gold concentrate with gold grade of 61.38g/t and gold recovery rate
of 89.73% can be achieved by “on- site process” flotation. The g old concentrate with gold grade of
64.25g/t and gold recovery rate of  90.57% can be achieved by the process of “two roughings, two
scavengings and three cleanings”. The mixed gold concentrate with a mixed gold grade of 66.80g/t
and the total gold recovery rate is 91.73% by “stage flotation process”. After comparative analysis of
processing flowsheet indexes, it is recommended to adopt “staged flotation process”.
A new Wulong processing plant wit h a capacity of 3,000tpd was b uilt in 2020, and it was put into
operation in January 2021. The old processing plant has ceased production. Grinding and separation
are divided into two series. The production capacity of the fir st series is 2,000tpd, and that of the
second series is 1,000tpd. The flotation process of “three roug hings, two scavengings and three
cleanings” is adopted for gold separation. The gold grade of RO M is 2.5-3.5g/t and the final gold
concentrate grade is 51-60 g/t. The recovery rate fluctuates be tween 89% and 93% due to the
– IIIA-48 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS xlvi
variance of ROM grade and ore properties. Table ES- 21 shows the historical production indexes of
the Wulong processing plant.
Table ES- 21: Historical Production Index of Wulong Processing Plant
Items Unit 2021 2022 2023 2024Q1-Q3
ROM throughput kt 382.1 418.6 579.3 512.52
Feed grade g/t 2.48 3.42 3.53 3.25
Concentrate output kt 14. 62  25.13  33.08 25.19
Concentrate grade g/t 57.93 51.5 57.01 60.25
Gold recovery % 89.37  90.39 92.23 91.07

Jintai Heap Leaching Plant
The main factor affecting the gold leaching rate is the ore par ticle size according to the results of
column leaching test from laboratory, SRK recommends that the p article size of the stacked ore be
100% less than 25mm, which is also a reasonable particle size that can be achieved by conventional
crushing system. The permeability of ore heap is a key factor affecting the success or failure of heap
leaching. The high content of "slime" (-200 mesh fines) in ore is very likely to cause the permeability
problem of ore heap. SRK suggests the use of pelleting heap lea ching process to avoid the
permeability problem. Following SRK's recommendation, Jintai has implemented ore pelleting in July
2024.
In order to verify the feasibility of gold extraction by heap leaching, Jintai Mining conducted industrial
tests of heap leaching at the mine site from January 2014 to February 2015. The industrial test was
carried out in three phases, with the test stacked ore grade ranging from 0.3 to 2.0g/t, with an average
of 1.06g/t. The total amount of heap leached ore was about 160, 000 t. A crushing process with two
open circuit sections and pre-screening before fine crushing was used to crush the ore to less than
50mm, which was transported by car to the leach pad for stackin g, with the initial test ore stacking
height ranging from 1 to 2.5m and the later ore stacking height  ranging from 5 to 15m. Leaching by
Leaching reagent solution spraying. The leaching period was abo ut 3 months, and the dosage of
Leaching reagent was stabilized at about 150g/t and the dosage of lime was stabilized at about
4.2kg/t, which was much lower than the dosage of column leachin g in the laboratory. The overall
gold leaching rate was about 80%, and the leaching result of the test was good, which confirmed that
heap leaching method for gold extraction was feasible in Xidengping mine.
GOCOM Engineering Design Co., Ltd. completed the Preliminary Design of Eryuan Jintai Mining
Development Co. Ltd. For 140,000t/a Open Pit Mining Project at Xidengping Gold Mine in Eryuan
County in October 2022, which was designed maximum size of stacked or e is 35mm and the heap
was constructed by truck and then bulldozer. The ore heap is co nstructed in multiple layers, each
layer is 7m high, and when the previous layer of leaching is fi nished, the next layer is directly
constructed without unloading the first one, until 6 layers. Th e heap was leached by spraying with
0.15%~0.20% Jinchan Gold Leaching Agent. The designed leaching rate is 85%, the final product is
gold-loaded carbon, with the heap leaching comprehensive recove ry rate of 85%. The GOCOM
Preliminary Design is the basis of the current heap leach plant  construction at mine, and also the
basis for this report.
– IIIA-49 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS xlvii
The heap leaching plant was completed in October 2023. As of 30  September 2024, a total of
527,027 t of ore had been heap leached (D1 to D6 heaps), with an average grade of 0.69g/t, yielding
271.60kg of gold (carbon-loaded gold) and a gold recovery rate of 74.71%. The ore currently being
leached amounts to 54.689 t (D7-1 and D7-2 heaps), with 17.34kg of gold recovered. The D8 heap,
which is currently being built.
Hanfeng Processing Plants
Hanfeng Mining commissioned Changchun Gold Design Institute to carry out two laboratory
processing test study on deep molybdenum ore and refractory molybdenum ore respectively in
December 2023. The deep molybdenum grade of the processing test sample is 0.115%, and the
closed-circuit process can obtain the molybdenum concentrate wi th molybdenum grade of 46.96%
and recovery of 88.05%. The refractory molybdenum grade of the processing test sample is 0.126%,
and the closed-circuit process can obtain the molybdenum concen trate with molybdenum grade of
46.26% and recovery of 74.72%.
Hanfeng Mining has two processing plants, Lishan plant and Dong feng plant. The Lishan plant
processes Cu-Pb-Zn polymetallic ore, which sources from Lishan and Dongfeng mining areas. It
adopts flotation process, and the main products are copper conc entrate, lead concentrate and zinc
concentrate. The designed production capacity of Lishan plant i s 1,500tpd, and the current
production capacity has reached 2,000tpd through technical renovation.
The Dongfeng plant processes molybdenum ore and the existing processing capacity is 700tpd. It
adopts flotation process, and the processing product is molybdenum concentrate. The plant ceased
operation for years and restart production in July 2022. Table ES- 22 shows the historical production
indexes of the two plants.
Table ES- 22:  Historical Production Index of Hanfeng Processing Plants
Items Unit 2021 2022 2023 2024 Q1-Q3 1
Lishan Processing Plant
Ore Milled kt 505. 89 578.98 351.11 372.03
     Feed Grade (Cu) % 0. 19 0.13 0.13 0.116
     Feed Grade (Pb) % 0.68 0.63 0.73 0.75
     Feed Grade (Zn) % 2.12 2.02 1.71 1.52
Cu Concentrate Output t 2,932 2,015 1,439 1,396
     Concentrate Garde (Cu) % 20.16 18.62 17.47 14.80
     Cu Recovery % 61.23  49.84 54. 35 47.86
Pb Concentrate Output t 3, 477 3,257 2,716 2,686
     Pb Concentrate Garde % 63.65 66.75 68.00 64.75
     Pb Recovery % 64.47  59.60 71. 69 62.19
Zn Concentrate Output t 19, 905 21,882 11,287 10,291
     Zn Concentrate Garde % 47.18 47.12 47.40 48.42
     Zn Recovery % 87.45  88.31 89. 17 87.88
Dongfeng Processing Plant
Ore Milled (Mo) kt - 15.02 82.11 163.98
     Feed Grade (Mo) % - 0.17 0.14 0.15
– IIIA-50 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS xlviii
Items Unit 2021 2022 2023 2024 Q1-Q3 1
Mo Concentrate Output t - 41.71 206.48 442.00
     Concentrate Garde (Mo) % - 43.45 40. 64 44.33
     Mo Recovery % - 71.69 67.57  79.74
Source: SRK
Notes: 1. The plants treated materials were only from the upper part of  the Lishan Mine and Dongfeng Mine, a small amount
of the original residuals and remnants or original abandoned low-grade orebodies and very thin orebodies.
Capital Expenditures and Operating Expenses.
The Capex and Opex are based on the historical operating data p rovided by each subsidiary
company.
Jilong Project
Capex
Sustaining Capex: SRK has applied an average sustaining unit cost of approximately RMB 324 per
milled ton, based on sustaining data from 2023 through 2024 Q3.
Expansion Capex: Jilong Mining has completed new preliminary de sign study for expansion zone
(zone 5, zone 6 and zone 7). The construction period is three y ears with the total capital cost of
RMB137.8 mln. has completed new preliminary design study for expansion deeper zone (zone 1,
zone 2 and zone 3). The construction is estimated to be finished in 2025 with the total capital cost of
RMB58.8 mln.
Opex
Table ES- 23 presents the historical unit Opex from 2021 to 202 4 Q3, excluding depreciation,
amortization, and financial costs. It also includes the average  unit cost and the unit cost for TEM
(technical economic model) input.
Table ES- 23: Historical Operating Costs from 2020 to 2024 Q3
Item Unit 2021 2022 2023 2024 Q3 Unit Cost TEM Input
Labor RMB/t 409.93 413.40 400.67 383.86 401.40 620.09
Material RMB/t 133.56 160.23 158.89 161.11 153.93 230.90
Electricity RMB/t 76.85 70.33  70.49 79.93 74.50 79.93
Contractors RMB/t - - - - - -
Engineering RMB/t 31.02 27.45  23.93 11.30 23.01 31.02
Service RMB/t 13.14 13.21 4.25 0.52 7.52 13.21
Safety RMB/t 27.56 26.19 20.02 41.12 29.05 41.12
Repairment RMB/t 9.90 10.95  11.05 1.46 8.14 11.05
Others RMB/t 3.59 3.44 1.38 0.55 2.18 3.59
Taxes and
surcharges RMB/t 118.10 104.55 414. 78 113.03 186.72 186.72
Selling costs RMB/t 0.57 0.6 6 0.76 0.02 0.49 0.76
G&A costs RMB/t 210.25 199. 34 282.57 172.28 215.09 282.57
R&D costs RMB/t 70.89 54.89  133.24 97.33 89.55 133.24
Note:
– IIIA-51 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS xlix
1 The TEM input is higher than the average unit cost because the milled tonnage at Jilong Mine exceeds the mining tonnage
due to comprehensive utilization, which results in a lower over all unit cost. As a result, SRK adjusted the unit cost upward
to a more reasonable level.

Huatai Project
Capex
Sustaining Capex: Huatai Gold Mine has no production in 2023 and 2024. SRK used the sustaining
unit costs from 2021 and 2022. These costs were adjusted to exc lude expansion and exploration
activities, resulting in an estimated sustaining unit cost of approximately RMB 162 per milled ton.
Expansion Capex: The Huatai Mine consists of six gold mines, wi th plans to expand production by
construction for each mine. Table ES- 24 presents the total budget and timeline allocated to each
project. Due to the limitations of the processing plant's capac ity, SRK has assumed that each
expansion will take three years to complete, with the construction start date based on the LOM.
Table ES- 24: Huatai Future Expansion
Project Budget (‘0000 RMB) C onstruction Period (Year)
Lianhuashan #5 Mining Zone 3,706 2024-2026
Honghuagou #1 Mining Zone 11,358 2026-2028
Lianhuashan #3&#7 Vein 2,113 2038-2040
Lianhuashan #26 Vein 2,237 2045-2047
Pengjiagou Mine 4,483 2047-2049
Source: Client
Opex
Table ES- 25 presents the historical unit Opex from 2021 to 202 4 Q3, excluding depreciation,
amortization, and financial costs. It also includes the average  unit cost and the unit cost for TEM
(technical economic model) input.
Table ES- 25: Historical Operating Costs from 2020 to 2024 Q3
Item Unit 2021 2022 2023 2024 Q3 Average Unit Cost TEM Input
Labor RMB/t 480.18 247.05 - - 455.53 576.21
Material RMB/t 46.27 83.04 - - 54.71 54.71
Electricity RMB/t 74.26 102.25 - - 82.79 74.26
Contractors RMB/t - - - - - -
Engineering RMB/t 170.75 539.68 - - 275.04 170.75
Service RMB/t 15.62 24.53 - - 17.74 24.53
Safety RMB/t 22.88 15.74 - - 21.03 22.88
Repairment RMB/t 6.60 6.64 - - 6.49 6.64
Others RMB/t 0.19 0.21 - - 0.34 0.34
Taxes and surcharges RMB/t 75.60 151.60 - - 171.75 75.60
Selling costs RMB/t - - - - - -
G&A costs RMB/t 246.40 1,440.29 - - 896.43 295.68
R&D costs RMB/t - - - - - -
Note
1 TEM inputs were based on rules of thumb from a nearby underground mine and adjusted accordingly.
– IIIA-52 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS l
Wulong Project
Capex
Sustaining Capex: SRK has applied an average sustaining unit cost of approximately RMB 511 per
milled ton, based on sustaining data from 2023 through 2024 Q3.
Opex
Table ES- 26 presents the historical unit Opex from 2021 to 202 4 Q3, excluding depreciation,
amortization, and financial costs. It also includes the average  unit cost and the unit cost for TEM
(technical economic model) input.
Table ES- 26: Historical Operating Costs from 2021 to 2024Q3
Item Unit 2021 2022 2023 2024 Q3 Average Unit Cost TEM Input
Labor RMB/t 209.75 226.65 241.48 210.30 223.34 670.03
Material RMB/t 49.73 134.41 146.78 95.59 110.58 331.73
Electricity RMB/t 73.58 100. 02 66.27 64.53 74.74 100.02
Contractors RMB/t 18.86 - - - 3.81 18.86
Engineering RMB/t 21.81 - - 3.41 5.33 21.81
Service RMB/t 2.51 19.54 14.09 47.25 21.95 47.25
Safety RMB/t - - - - - -
Repairment RMB/t 8.10 5.24 3.79 6.24 5.64 8.10
Others RMB/t - - - - - -
Taxes and surcharges RMB/t 33.21 49.13 54.69 58.85 50.26 58.85
Selling costs RMB/t - - - - - -
G&A costs RMB/t 56.26 105.66 48.74 27.45 57.07 105.66
R&D costs RMB/t 29.09 38.73  46.29 51.14 42.46 51.14
Note
1 The TEM input is higher than the average unit cost because the milled tonnage at Wulong Mine exceeds the mining tonnage
due to comprehensive utilization, which results in a lower over all unit cost. As a result, SRK adjusted the unit cost upward
to a more reasonable level.
Jintai Project
Capex
Sustaining Capex: Jintai Mining has started operation since 2023. SRK used the averaged unit cost,
approximately 24 RMB/milled ton, as the forecasted sustaining unit cost for the LOM.
Opex
Table ES- 27 presents the historical unit Opex from 2023 to 202 4 Q3, excluding depreciation,
amortization, and financial costs. It also includes the average  unit cost and the unit cost for TEM
(technical economic model) input.
Table ES- 27: Historical Operating Costs from 2023 to 2024Q3
Item Unit 2023 2024 Q3 Average Unit Cost TEM Input
Labor RMB/t 14.43 6.58 8.41 14.43
Material RMB/t 15.15 13.25 13.70 15.15
Electricity RMB/t 0.57 1.48 1.27 1.48
Contractors RMB/t 8.44 2.66 4.01 8.44
– IIIA-53 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS li
Item Unit 2023 2024 Q3 Average Unit Cost TEM Input
Engineering RMB/t 8.73 10.25 9.89 10.25
Service RMB/t 12.18 15.82 14.97 15.82
Safety RMB/t 5.00 4.08 4.30 5.00
Repairment RMB/t - - - -
Others RMB/t - - - -
Taxes and surcharges RMB/t 9.98 0.08 2.39 9.98
Selling costs RMB/t 0.36 0.27 0.29 0.36
G&A costs RMB/t 36.20  15.82 20.57 36.20
R&D costs RMB/t - - - -
1 TEM inputs were based on rules of thumb from a nearby underground mine and adjusted accordingly.
Hanfeng Project
Capex
Sustaining Capex: Hanfeng Mining operate two mines: the Lishan Mine and the Dongfeng Mine. Only
the Lower Part (Stage 1) of the Lishan Mine was considered in Ore Reserves estimation. Currently,
this Lower Part is under construction and has no production.
The capital expenditure data of the Upper Part of the Lishan Mi ne and the Dongfeng Mine is
referenced for the economic analysis of the Lower Part of the L ishan Mine. SRK has applied an
average sustaining unit cost of approximately RMB 80 per milled ton, based on sustaining data from
2023 through 2024 Q3.
Opex
Table ES- 28 presents the historical unit Opex from 2021 to 2024 Q3 for the Upper Part of the Lishan
Mine and the Dongfeng Mine, excluding depreciation, amortizatio n, and financial costs. It also
includes the average unit cost and the unit cost for TEM (technical economic model) input.
Table ES- 28: Historical Operating Costs from 2021 to 2024Q3
Item Unit 2021 2022 2023 2024 Q3 Average Unit Cost TEM Input
Labor RMB/t 51.69 62.90 57.61 144.02 80.02 64.02
Material RMB/t 34.72 38.94 26.85 32.78 33.78 27.02
Electricity RMB/t 28.73 32.93  30.97 23.50 29.05 23.24
Contractors RMB/t - - - 39.78 10.28 8.23
Engineering RMB/t 28.30 23.66  21.22 0.03 18.17 14.54
Service RMB/t 1.94 1.37 0.58 1.10 1.28 1.02
Safety RMB/t 4.35 2.77 3.04 6.15 4.09 3.27
Repairment RMB/t 1.18 0.68 0.66 0.34 0.71 0.57
Others RMB/t 2.51 1.57 1.50 1.05 1.65 1.32
Taxes and surcharges RMB/t 15.49 16.83 8.54 22.01 16.10 12.88
Selling costs RMB/t 0.23 0.27 0.25 - 0.19 0.15
G&A costs RMB/t 30.84 21.38  33.96 23.95 27.00 21.60
R&D costs RMB/t - - - - - -
Note
1 The unit cost in the TEM input is lower than the average unit cost because the historical costs include both Lishan Mine and
Dongfeng Mine. As a result, SRK adjusted the unit cost downward to a more reasonable level.

– IIIA-54 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS lii
Economic Analysis
The economic analysis presented here is based on the results of  the technical review. Some key
assumptions are made for technical evaluation and Ore Reserve e stimation purposes only. The
Project economic analysis was conducted using the discount cash flow (“DCF”) method and is based
on assumptions of technical and economic parameters from actual historical production data and the
feasibility study and/or mine design of each mine with some adjustments by SRK.
The following  Table ES- 29 shows the forecasted Capex over the LoM and the forecasted unit Opex
for the Chifeng Gold each project.
Table ES- 29: Forecasted Capex over the LoM and Forecasted Unit Opex for Each Project
Capex Unit Over LoM
Jilong 1 Huatai 2 Wulong Jintai Hanfeng 3
Expansion RMB mln 197 239 0 0  109
Sustaining RMB mln 298 274 503 33 266
Closure RMB mln 15 37 40 6 15
Opex Unit Over LoM (TEM Input)
Jilong Huatai Wulong Jintai Hanfeng
Labor RMB/t Ore 401 456 223 8 80
Material RMB/t Ore 154 55 111 14 34
Electricity RMB/t Ore 75 83 75 1 29
Contractors RMB/t Ore 0 0 4 4 10
Engineering RMB/t Ore 23 275 5 10 18
Service RMB/t Ore 8 18 22 15 1
Safety RMB/t Ore 29 21 0 4 4
Repairment RMB/t Ore 8 6 6 0 1
Others RMB/t Ore 2 0 0 0 2
Taxes and surcharges RMB/t Ore 187 172 50 2 16
Selling costs RMB/t Ore 0 0 0 0 0
G&A costs RMB/t Ore 215 896 57 21 27
R&D costs RMB/t Ore 90 0 42 0 0
Source: SRK
Note:
1 Expansion for zones 5, 6 and 7; Deeper expansion for zone 1, 2 and 3;
2 Expansion initial; and
3 Expansion initial for Lishan Mine Lower Part
The following Table ES- 30 shows the total cash flow over the L oM for each of the Chifeng Gold’s
project.
Table ES- 30: Total Cash Flow over the LoM for Each Project (unit: RMB mln)
Item Total Cash Flow over the LoM
Jilong Huatai Wulong Jintai Hanfeng
Revenue 4,043 4,597 2,989 380 1,189
Opex 1,502 2,204 1,391 160 589
Capex 509 549 543 40 391
Tax & other fees 326 470 194 50 85
After tax cash-flow 1,706 1,374 861 128 125
Source: SRK
– IIIA-55 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS liii
The estimated NPV of each project with different discount rates  are shown in Table ES- 31. The
NPVs at 10% discount rate, as a base case are RMB1,308 mln for the Jilong Project, RMB291 mln
for the Huatai Project, RMB 634 mln for the Wulong Project, RMB  83 mln for the Jintai Project, and
RMB 39 mln for the Hanfeng Project.
Table ES- 31: NPV with Different Discount Rates for Each Project (unit: RMB mln)
Discount Rate NPV
Jilong Huatai Wulong Jintai Hanfeng
5% 1,481 601 730 101 76
6% 1,442 516 709 97 67
7% 1,406 445 688 93 60
8% 1,372 385 669 90 53
9% 1,339 334 651 86 46
10% 1,308 291 634 83 39
11% 1,278 255 618 80 33
12% 1,250 223 602 77 28
13% 1,223 196 588 75 22
14% 1,197 172 574 72 17
15% 1,173 152 561 70 12
Source: SRK
Environmental approvals and status
Jilong Project
Three EIA reports have been completed and approved for the Jilo ng Project, covering the current
main production facilities, the expanded processing plant and t he new tailings storage facility. No
rare plants and wild animals under state have been found around  the project. Mine water is
sedimented underground and discharg ed into the upper sump and r eused in the processing plant.
During the winter, the project may have a small amount of mine water discharging outside. During
this site visit, SRK noticed that there are waste rock dumps in  each mining area of the project. At
present, the tailings of the proj ect are dry discharged into th e TSF after being treated in the filter
press workshop. The accident and collection ponds were built at the foot of the tailings dam. During
the time of SRK’s site visit, SRK did not observe any evidence of leaching or ARD impacts. SRK
sighted that dust removers were installed in the processing plant. SRK did not note the obvious dust
emission in the open area of the project during the time of this site visit.
Huatai Project
The EIA report for Chifeng Huatai Mining Ltd. Gold Mine Mining and Processing Expansion Project
(60 ktpa) was prepared by Chifeng City Environmental Science Institute in May 2007. The EIA report
was approved by Chifeng City Environmental Protection Bureau on  June 6, 2007. In addition, SRK
has sighted other six EIA reports and approvals which cover the whole mining sections.
The EIA report states that there are no sensitive targets such as natural reserves within 10 km of the
project area. There are no rare, endangered and protected flora and fauna species within the scope
of the project. The mine water is generally collected by water tank and reused for underground
production. The processing wastewater is fully recycled, and th e tailings filter wastewater is reused
for processing as well. At present, waste rock from the project  is mainly used for underground
– IIIA-56 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Executive Summary    Final
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backfilling or sold for road building. During the site visit, S RK noticed that there are past-generated
waste dumps at the portal of shafts in each mining area. During the time of SRK’s site visit, SRK did
not observe any evidence of leaching or ARD impacts.
Wulong Project
The EIA report for Liaoning Wulong Gold Mine Development Projec t (0.15Mtpa) was prepared by
Dandong City Environmental Protection Science Institute in Octo ber 2006. The EIA report was
approved by Dandong City Environmental Protection Bureau on November 6, 2006.
The EIA report for Liaoning Wulong Zhoujiagou TSF Treatment and  Processing Plant (800t/d)
Decommissioning Project was produced by China Coal Technology & Engineering Group Shenyang
Design & Research Institute Ltd. in December 2013. The EIA report was approved by Dandong City
Environmental Protection Bureau on April 8, 2014.
SRK noted that the EIA reports for the Liaoning Wulong Gold Mine Development Project (0.15Mtpa)
and Liaoning Wulong Zhoujiagou TSF Treatment and Processing Plant (800 tpd) Decommissioning
Project does not include the new processing plant. Wulong Mining stated that the EIA report for the
new processing plant had been submitted to the environmental pr otection bureau and was under
review.
The EIA report states that there were no rare or endangered flora and fauna in the project area. The
project has a water treatment plant to treat mine water. The treated mine water is reused for
production and heating, and the excess water is discharged into  the Banshi River. SRK noted that
the project's TSF is approximately 7 km from the downstream res ervoir. SRK recommends that
quality monitoring be undertaken of the groundwater and surface water resources within the project
area (including upstream and downstream of the project area), a nd also any site water discharges.
During this site visit, SRK noticed that the waste rocks were t emporarily dumped at the portal of
shafts in each mining area. Liaoning Wulong stated that the waste rock from the project is mainly
used for underground backfilling or sold for construction. At p resent, the tailings of the project are
dry discharged into the TSF after being treated in the filter press workshop. The accident and leakage
collection ponds were built at the foot of the tailings dam. During the time of SRK’s site visit, SRK did
not observe any evidence of leaching or ARD impacts.
Jintai Project
The EIA report for Xidengping Gold Mine Mining, Processing and Tailings Project (0.14Mtpa) was
conducted by Kunming Nonferrous Metallurgy Design & Research Institute Led in December 2013.
The EIA report was approved by Yunnan Province Environmental Protection Bureau on February 17,
2014.
During the EIA baseline study, some National second-class protected plants and animals were found
in the project’s survey area. The EIA concluded that with bette r management, the operation of the
project would not have a significant impact on the diversity an d distribution pattern of vegetation in
this area and would have a lesser impact on wildlife. During this site visit, SRK observed the drainage
ditch was well constructed around the leaching heap. Emergency pond and rainwater collection pond
were constructed downstream of the leaching heap. The leach hea p was paved with HDPE
membrane and bentonite to prevent seepage. SRK sighted groundwater monitoring boreholes were
utilized around the leaching heap. SRK noted the exceedance of arsenic levels in soil at the mine
– IIIA-57 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS lv
site during the environmental baseline study. The EIA report op ines that this is related to the co-
occurrence of arsenic in the gold ore formation process and tha t the project is located in an area
where the background value of arsenic is high. The waste rock w as discharged into the waste rock
dump on site and the topsoil was collected for the future reclamation.
Hanfeng Project
The EIA report for Longjing Hanfeng Mining Ltd. Tianbaoshan Min e Area Residual Resources
Recovery and Utilization Project was prepared by Yanbian Enviro nmental Protection Science
Institute in March 2005. The EIA report was approved by Yanbian Environmental Protection Bureau
on March 14, 2005.
The EIA report for Lishan-xinxing Mine Area Lead-Zinc Mining Ex pansion Project (0.18Mtpa) was
prepared by Jilin Metallurgical Research Institute Jilin Linchang Environmental Technology Service
Ltd. in May 2013. The EIA report was approved by Jilin Province  Environmental Protection Bureau
on June 9, 2013.
The EIA report for Jilin Hanfeng Lishan Processing Plant Techni cal Transformation Project was
produced by Jilin Northeast Coal Industry Environmental Protection Research Ltd. in February 2017.
The EIA report was approved by Yanbian Environmental Protection  Bureau on February 20, 2020.
The EIA report for Jilin Hanfeng Lishan Mining Area Expansion P roject (0.6Mtpa) was prepared by
Jilin Linchang Environmental Service Ltd. Jilin Province Ecolog y and Environmental Bureau issued
EIA approval on August 31, 2021.  No endangered or protected flo ra and fauna in the project area
were reported in the EIAs. Surface water bodies near the project include the Baoshan River and the
Burhaton River. SRK suggests that the company establish an emer gency water supply plan to
address issues such as changes in groundwater levels. If the development affects the water usage
of surrounding communities, alternative water sources can be pr ovided. During this site visit, SRK
noticed that the waste rocks from the project were temporarily dumped near the portal of shaft in the
mining area and processing plant. Jilin Hanfeng stated that the  waste rock is mainly used for
underground backfilling. SRK has s ighted some former waste rock  dumps on site and one of them
has been rehabilitated. At present, the tailings of the project  are discharged into the TSF. SRK has
sighted minor dust generation in the TSF during the site visit.
Risk Assessment
SRK completed a risk assessment o f the risks identified for the  Chifeng Gold Project in relation to
their likelihood of occurrence and consequence in accordance wi th the Exchange to the Listing
Rules.
SRK considers various technical aspects which may affect the feasibility and future cash flow of each
operating mine and conducts risk assessments for the Chifeng Gold Project based on similar techno-
economic conditions among the three mines, which have been summarized in Table ES- 32.
Table ES- 32:  Risk Assessment  for Chifeng Gold Project
Risk Source/Issue Likelihood Consequence Risk
Jilong Project
Geology, Mineral Resources and Ore Reserves
Lack of Significant Miner Resource Unlikely Moderate Low
Lack of Significant Ore Reserve Unlikely Major Medium
– IIIA-58 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Risk Source/Issue Likelihood Consequence Risk
Significant Unexpected Geological Faulting Possible Moderate Me dium
Unexpected Groundwater Ingress Unlikely Moderate Low
Mining
Significant Production Shortfalls Possible Moderate Medium
Significant Geological Structure Unlikely Moderate Low
Excessive Surface Subsidence Unlikely Moderate Low
Lack of Competent Technical Personnels Possible Moderate Medium
Poor Mine Technical Management Possible Moderate Medium
Significantly lacking Ore Reserves Unlikely Major Medium
Processing and Metallurgy
Poor Plant Reliability Unlikely Moderate Low
Lower Throughput Unlikely Moderate Low
Lower Smelting Recovery Possible Moderate Medium
Environmental and Social
Water Management Possible Moderate Medium
Waste Rock and Tailings Management Possible Moderate Medium
Hazardous Materials Management Unlikely Moderate  Low
Social Aspects Unlikely Moderate Low
Capital and Operating Costs
Project Timing Delay Unlikely Minor Low
Capital Cost Increases Possible Moderate Medium
Capital Costs- Ongoing Possible Moderate Medium
Operating Cost Underestimated Possible Moderate Medium
Huatai Project
Geology, Mineral Resources and Ore Reserves
Lack of Significant Mineral Resource Unlikely Moderate Low
Lack of Significant Ore Reserve Unlikely Major Medium
Significant Unexpected Geological Faulting Possible Moderate Me dium
Unexpected Groundwater Ingress Unlikely Moderate Low
Mining
Significant Production Shortfalls Unlikely Moderate Low
Significant Geological Structure Unlikely Moderate Low
Excessive Surface Subsidence Unlikely Moderate Low
Lack of Competent Technical Personnels Possible Moderate Medium
Poor Mine Technical Management Possible Moderate Medium
Significantly lacking Ore Reserves Unlikely Major Medium
Ore Processing and smelting
Poor Plant Reliability Possible Moderate Medium
Lower Throughput Possible Moderate Medium
Lower Smelting Recovery Possible Moderate Medium
Environmental and Social
Water Management Unlikely Major Medium
Waste Rock and Tailings Management Possible Moderate Medium
Hazardous Materials Management Unlikely Moderate Low
Capital and Operating Costs
Project Timing Delay Likely Minor Low
Capital Cost Increases Possible Moderate Medium
Capital Costs- Ongoing Possible Moderate Medium
Operating Cost Underestimated Likely Moderate High
Wulong Project
Geology, Mineral Resources and Ore Reserves
Lack of Significant Mineral Resource Unlikely Moderate Low
Lack of Significant Ore Reserve Unlikely Major Medium
– IIIA-59 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Risk Source/Issue Likelihood Consequence Risk
Significant Unexpected Geological Faulting Possible Moderate Me dium
Unexpected Groundwater Ingress Unlikely Moderate Low
Mining
Significant Production Shortfalls Possible Moderate Medium
Significant Geological Structure Unlikely Moderate Low
Excessive Surface Subsidence Unlikely Moderate Low
Lack of Competent Technical Personnels Possible Moderate Medium
Poor Mine Technical Management Possible Moderate Medium
Significantly lacking Ore Reserves Unlikely Major Medium
Ore Processing
Poor Plant Reliability Unlikely Moderate Low
Lower Throughput Unlikely Moderate Low
Lower Processing Recovery Possible Moderate Medium
Environmental and Social
Water Management Possible Moderate Medium
Waste Rock and Tailings Management Unlikely Moderate Low
Environmental Approval Possible Moderate Medium
Social Aspects Possible Minor Low
Capital and Operating Costs
Project Timing Delay Unlikely Minor Low
Capital Cost Increases Possible Moderate Medium
Capital Costs- Ongoing Possible Moderate Medium
Operating Cost Underestimated Possible Moderate Medium
Jintai Project
Geology, Mineral Resources and Ore Reserves
Lack of Significant Mineral Resource Unlikely Moderate Low
Lack of Significant Ore Reserve Unlikely Major Medium
Significant Unexpected Geological Faulting Possible Moderate Me dium
Unexpected Groundwater Ingress Unlikely Moderate Low
Mining
Significant Production Shortfalls Unlikely Moderate Low
Significant Geological Structure Unlikely Moderate Low
Excessive Surface Subsidence Unlikely Moderate Low
Lack of Competent Technical Personnels Unlikely Moderate Low
Poor Mine Technical Management Unlikely Moderate Low
Significantly lacking Ore Reserves Unlikely Major Medium
Processing and Metallurgy
Poor Process Reliability Unlikely Moderate Low
Lower Ore Throughput Unlikely Moderate Low
Poor Permeability of Ore Heap Possible Moderate Medium
Lower Gold Recovery Possible Moderate Medium
Environmental and Social
Water Management Unlikely Major Medium
Waste Rock and Tailings Management Unlikely Moderate Low
Social Aspects Possible Moderate Medium
Capital and Operating Costs
Project Timing Delay Unlikely Minor Low
Capital Cost Increases Possible Moderate Medium
Capital Costs- Ongoing Possible Moderate Medium
Operating Cost Underestimated Possible Moderate Medium
Hanfeng Project
Geology, Mineral Resources and Ore Reserves
Lack of Significant Mineral Resource Possible Major Low
– IIIA-60 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Risk Source/Issue Likelihood Consequence Risk
Lack of Significant Ore Reserve Unlikely Major Medium
Significant Unexpected Geological Faulting Possible Moderate Me dium
Unexpected Groundwater Ingress Unlikely Moderate Low
Mining
Significant Production Shortfalls Unlikely Moderate Low
Significant Geological Structure Unlikely Moderate Low
Excessive Surface Subsidence Unlikely Moderate Low
Lack of Competent Technical Personnels Possible Moderate Medium
Poor Mine Technical Management Possible Moderate Medium
Significantly lacking Ore Reserves Unlikely Major Medium
Ore Processing
Poor Plant Reliability Possible Moderate Medium
Lower Throughput Possible Moderate Medium
Lower Processing Recovery Possible Moderate Medium
Environmental and Social
Water Management Unlikely Moderate Low
Waste Rock and Tailings Management Possible Moderate Medium
Environmental Approval Unlikely Moderate Low
Capital and Operating Costs
Project Timing Delay Unlikely Minor Low
Capital Cost Increases Possible Moderate Medium
Capital Costs- Ongoing Possible Moderate Medium
Operating Cost Underestimated Possible Moderate Medium
Recommendations
SRK Offers the following recommendations:
Huatai Project
In general, the mines of Huatai Project were operated at small scale capacity for a long time. The
geotechnical and hydrogeological conditions are not complex to deal with. Therefore, the
underground access method, stoping  method, and related service systems and machinery are
suitable for the mine operations.
In order to ensure normal mining production in the future, the existing operation system and the
design needs further supplementation and improvement, which include mainly the following aspects:
 The reconciliation study is recommended in the future. The reco nciliation study would help the
operation to compare the estimates against production, then imp rove the estimation getting a
higher-level confidence of resource estimates and improve mining operation outcomes.
Wulong Project
Underground Geological sampling at Wulong Mine has continued th roughout 2024, the tunnel
sampling data needs to be provided to SRK for the resource model update in alignment with the
mining depletion data.
The actual dilution rate and recovery rates appear to be inconsistent with the planned targets, as the
mining grade is significantly lower than the geological grade. It has been noted by onsite personnel
that, in the interest of comprehe nsive resource utilization, a portion of lower-grade ore has been
– IIIA-61 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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intentionally blended in. It is recommended that a reconciliati on study be conducted to better
understand the underlying discrepancies and to facilitate improvements in future production.
As the ore comes from different mining areas, and the ROM prope rties are obviously different and
fluctuating, SRK suggests that  the reagent regime in the proces s of actual production should be
adjusted according to the production situation to obtain the optimal separating indexes.
Jintai Project
SRK considers the mining and stripping methods adopted to be a mature mining technology
commonly used in open pit mining practices, and technically both are reasonable and feasible. The
designed bench height and slope angle are considered reasonable , as well as the small-scale
excavator is suitable for selective mining. However, the truck payload (7.8t) is not commonly used in
practice. Some larger trucks (30t payload) were observed standi ng by during site visit. The loading
round would be increased then the haulage round would be reduce d. But the excavator and truck
matching each other would not be a material risk for operation, as the total volume of mining is small.
For the heap leaching plant, SRK recommends that the particle size of the stacked ore be 100% less
than 25mm, which is also a reasonable particle size that can be  achieved by conventional crushing
system. The permeability of ore heap is a key factor affecting the success or failure of heap leaching
operation. The high content of " slime" (-200 mesh) in Xidengpin g ore is very likely to cause the
permeability problem of ore heap. SRK suggests the use of pelleting heap leaching process to avoid
the permeability problem. SRK believes that the designed recovery rate can be achieved under the
condition of ensuring the ore size and the heap permeability. H eap leaching has the characteristics
of flexible scale, low Capex and Opex, and rapid benefit. The d iscovery of V4 Mineralised body
makes it possible to further expand the scale of heap leaching. SRK suggests that the possibility of
future expansion of production scale should be considered when the heap leaching facilities are
designed and constructed.
The final product of the mine is designed to be gold-loaded car bon. SRK suggests that, if possible,
a smelting workshop be built in the mine to use a processing device of "high-temperature elution and
homo-thermal electrowinning " to produce gold bullion, or gold ingot. The gold stripped carbon will
be returned to the adsorption system after regeneration.
Hanfeng Project
SRK recommends Hanfeng Mining to carry out in-fill drilling exp loration and/or underground
exploration for resource category upgrade to meet life of mine plan for the lower parts of both Lishan
and Dongfeng mines.
In order to ensure stable mining production in the future, the existing operation system and the design
needs further supplementation and improvement.
– IIIA-62 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Introduction    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 1
1 Introduction
Chifeng Jilong Gold Mining Co., Ltd. (“Chifeng Gold”, the “Company” or the “Client”) commissioned
SRK Consulting China Limited (“SRK’) to undertake an independen t technical assessment of all
relevant aspects of its five subsidiaries’ operating gold and p olymetallic mines and associated
processing and metallurgical plants (hereafter referred to as t he “ Chifeng Gold Project ” or the
“Project”), located in the People’s Republic of China (“China’).
The Chifeng Gold Project consists of the following mining projects:
 Jilong Project: it includes the Zhuanshanzi gold mine (“Zhuanshanzi Mine”), Jilong metallurgical
and processing plant and other supporting facilities, located i n Inner Mongolia Autonomous
Region (‘Inner Mongolia”). The Jilong Project is wholly owned a nd operated by Chifeng Jilong
Mining Co., Ltd. (“Jilong Mining”)
 Huatai Project: it consists of six (6) operating gold mines, #2 6 Vein, #3&7 Vein, #86 Vein, #1
Mining Zone, #5 Mining Zone and Pengjiagou mines, Huatai proces sing and metallurgical plant
and other supporting facilities, located in Chifeng City, Inner  Mongolia. The Huatai Project is
wholly owned and operated by Chifeng Jilong Mining Co., Ltd. (“Jilong Mining”).
 Wulong Project: it includes the Wulong gold mine (“ Wulong Mine”), Wulong processing plant,
and two exploration gold properties, namely the Ligunzi deposit  and the Haojingou-Ligunzi
deposit, which are all located in Dandong City, Liaoning Province. The Wulong Project is wholly
owned and operated by Liaoning Wulong Gold Mining Co., Ltd. (“Wulong Mining”).
 Jintai Project: it consists of the Xidengping gold mine (“ Xidengping Mine”)  and Jintai heap
leaching plant, located in Eryuan County, Yunnan Province. The Jintai Project is owned and
operated by Eryuan Jintai Mining Development Co., Ltd. (“Jintai Mining”).
 Hanfeng Project: it includes two lead and zinc polymetallic mines (i.e., Lishan Mine and Dongfeng
Mine), two ore processing plants and one Dongfeng exploration molybdenum deposit. They are
all located in Yanbian Korean Autonomous Prefecture (“Yanbian”), Jilin Province. The Hanfeng
Project is wholly owned and opera ted by Jilin Hanfeng Mining Te chnology Co, Ltd. . ( Hanfeng
Mining”).
SRK understands that the independent technical assessment was r equired to be included in a
Competent Person’s Report (“ CPR”, the “ Report” or this “ Report”) to provide Chifeng Gold and
potential equity investors as well as possible future sharehold ers with SRK’s technical opinions on
the Project.
The Report was prepared following the requirements of the 2012 edition of the Australasian Code
for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the “JORC Code”) and
in accordance with the rules governing the listing of securities on the Stock Exchange of Hong Kong
Ltd (the “Exchange”) including the Chapter 18 requirements (Appendix B), Chapter 2.6 of the Guide
for New Listing Applicants (Appendi x C) and other relevant regu lations of the Exchange and Hong
Kong Exchanges and Clearing Ltd (“HKEx”).
This Report does not express an opinion as to the value of mineral or other assets involved.
– IIIA-63 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Program Objectives and Work Program   Final
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2 Program Objectives and Work Program
2.1 Purpose of the Report
The purpose of this Report is to provide both existing Chifeng Gold shareholders and potential
investors with a CPR of the Chifeng Gold Project located in Inn er Mongolia, Liaoning, Jilin and
Yunnan provinces of China. The SRK’s report is proposed to prov ide an unbiased technical
assessment of the risk and opportunities associated with the Project.
2.2 Reporting Standard
This Report has been prepared to the standard of, and is consid ered by SRK to be, a Technical
Assessment Report under the guidelines of the 2015 edition of the Code for Technical Assessment
and Valuation of Mineral Petroleum Assets and Securities for Independent Expert Reports  (the
“Valmin Code ”). The Valmin Code incorporates the JORC Code for the reportin g of Mineral
Resources and Ore Reserves and is binding upon all the Australa sian Institute of Mining and
Metallurgy (“AusIMM”) members.
This Report is not a Valuation Report and does not express an o pinion as to the value of mineral
assets. Aspects reviewed in this Report do include product pric es, socio-political issues and
environmental considerations; however, SRK does not express an opinion regarding the specific
value of the assets and tenements involved.
In this Report, identified Mineral Resources and Ore Reserves a re quoted using categorisation in
accordance with the JORC Code.  However, it should not be assumed that these Mineral Resource
and Ore Reserve Estimates have necessarily been carried out in accordance with the guidelines and
recommendations laid out in the JORC Code, at least until furth er documentation can be obtained
on the estimates and they have been formally endorsed by a “Competent Person” in accordance with
the JORC Code.
2.3 Limitations Statement
SRK is not professionally qualified to opine upon and/ or confirm that the Client has 100% ownership
of its underlying tenement and/ or has any unresolved legal mat ters relating to any transfer of
ownership or associated fees and royalties. SRK has therefore a ssumed that there are no legal
impediments regarding the existence of the relevant tenements and that the Client has legal right to
all underlying tenements as purported. Assessing the legal tenures and rights to the prospects of the
Client and or any of its subsidiary companies are the responsibility of legal due diligence conducted
by entities other than SRK.
2.4 Effective Date
The effective date for this CPR is deemed to be 30 September 20 24 (the “Effective Date”).  The
Mineral Resource and Ore Reserve statements set out in this CPR are reported as of 30 September
2024 and represent the Mineral Resources and Ore Reserves at th e Effective Date as audited by
SRK.
– IIIA-64 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Program Objectives and Work Program   Final
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The life of mine (the “ LoM”) plans and associated technica l and economic parameters included in
the LoM plans and technical and economic models all commence on 1 October 2024.
2.5 Work Program
The work program of this Project included:
 review of all relevant information and documents provided by Chifeng Gold as of 30 September
2024;
 site inspection to each of mines, processing and metallurgical plants and supporting facilities in
December 2022, January and March 2023, and May and June 2024;
 data verification conducted by SRK in December 2022 and May 2024;
 discussion with the Company management and technical personnel;
 analysis of the data provided by the Company and generated by SRK;
 construct the geological solids, prepare data for statistical, established the block model, estimate
grades, tabulate Mineral Resources;
 preparation of a draft report in accordance with the JORC Code and the rules governing the
listing of securities on the Exchange including the Chapter 18 requirements and other relevant
regulations of the Exchange and HK Ex (the declaration date of M ineral Resources and Ore
Reserves is 30 September 2024); and
 submission of the draft to Chifeng Gold and the related third parties for comments and finalization
of the draft based on feedback.
2.6 SRK Experience
The SRK Consulting Group (“SRK Consulting”) is an independent, international consulting practice
that provides focused advice and solutions to clients, mainly f rom earth and water resource
industries. For mining projects, SRK Consulting offers services  from exploration through feasibility,
mine planning, and production to mine closure.
Among the company’s more than 1,500 clients are most of the world’s major and medium-sized metal
and industrial mineral mining houses, exploration companies, banks, petroleum exploration.
Formed in 1974 in Johannesburg, South Africa, SRK Consulting no w employs more than 1,800
professionals internationally in 42 permanent offices across 20 countries on six continents. A broad
range of internationally recognised associate consultants complements the core staff.
SRK Consulting employs leading specialists in each field of science and engineering. Its seamless
integration of services, along with its global base, has made t he company a world leader in due
diligence, feasibility studies, and confidential internal reviews.
SRK Consulting’s independence is ensured by the fact that it holds no equity in any project and that
its ownership rests solely with its staff. This enables the company to provide its clients with objective,
conflict-free recommendations on crucial judgement issues.
– IIIA-65 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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SRK China was established in 2005 and has three offices located in Beijing, Nanchang and Kunming.
Either independently or together with other SRK Consulting offi ces—especially SRK Australasia,
SRK has been providing independent technical services for the C hinese mining companies. SRK
has considerable experience in providing Independent Expert Rep orts to mining companies for
successfully listing on the stock exchanges in Hong Kong, Australia, United Kingdom, Canada, South
Africa and the United States.
SRK has provided dozens of independent technical reports for th e Chinese mining companies who
have completed successfully list ed and/or acquired on the Stock  Exchange of Hong Kong Ltd., as
shown in Table 2-1.
Table 2-1: SRK’s Reports f or Listing on the HKEx
Company Year Nature of Transaction
Yanzhou Coal Limited (listed in HKEx) 2000 Sale of Jining III coal mine to the listed operating company
Chalco (Aluminium Corporation of
China) 2001 Listing on HKEx and New York Stock Exchange
Fujian Zijin Gold Mining Group 2004 IPO Listing on HKEx
Lingbao Gold Limited 2005 IPO Listing on HKEx
Yue Da Holdings Limited (listed in
HKEx) 2006 Acquisition of shareholding in mining projects in Yunnan,
China
China Coal Energy Company Ltd
(China Coal) 2006 IPO Listing on HKEx
Sino Gold Mining Limited 2007 Dual Listing on HKEx
Xinjiang Xinxin Mining Industry Co.,
Ltd 2007 IPO Listing on HKEx
Kiu Hung International Holding Limited 2008 Acquisition of shareholding in coal projects in Inner Mongolia,
China
Hao Tian Resource Group Limited 2009 Very Substantial Acquisition of two coal mines in Inner
Mongolia, China
Green Global Resources Holdings Ltd 2009 Very Substantial Acquisition of shareholding in one iron project
in Mongolia
Ming Fung Jewellery Group Holdings
Ltd 2009 Acquisition of shareholding in gold project in Inner Mongolia,
China
Continental Holdings Limited 2009 Acquisition of a gold project in Henan, China
North Mining Shares Company Limited 2009 Acquisition of a molybde num mining project in Shaanxi, China
CNNC International Ltd 2010 Acquisition of a uranium mine in Africa
Sino Prosper Mineral Products Ltd 2010 Acquisition of shareholdings in one gold project in Inner
Mongolia, China
New Times Energy Corporation Ltd 2010 Acquisition of shareholding  in gold projects in Hebei, China
United Company RUSAL Limited 2010 IPO Listing on HKEx
Citic Dameng Holdings Limited 2010 IPO Listing on HKEx
China Hanking Holdings Limited 2011 IPO Listing on HKEx
China Daye Non-Ferrous Metal Mining
Limited 2012 Very Substantial Acquisition on HKEx
China Nonferrous Mining Corporation
Limited 2012 IPO Listing on HKEx
– IIIA-66 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Program Objectives and Work Program   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 5
Company Year Nature of Transaction
Hengshi Mining Investments Limited 2013 IPO Listing on HKEx
Future Bright Mining Holdings Limited 2014 IPO Listing on HKEx
King Stone Energy Group Limited 2014 Acquisition of Shareholding in silver mines in Fujian, China
Agritrade International Pte LTD 2015 Acquisition of Shareholding  in one coal mine in Indonesia
China Unienergy Group Limited 2016 IPO Listing on HKEx
Pizu Investment Co. Ltd 2020 Acquisition of Shareholding in a polymetallic project in China
China Qinfa Group Limited 2021 Annual disclosure of coal mines in Shanxi, China
China Graphite Group Limited 2022 IPO Listing on HKEx
Kinetic Development Group 2022 Major transaction of equity interest in Ningxia Sunshine
Persistence Resources Group Ltd 2023 IPO Listing on HKEx
2.7 Project Team
The SRK project team and responsibilities are shown in Table 2-2.
Table 2-2: SRK Project Team
Consultant Title Discipline and Task
Dr. Yiefei Jia Principal Consultant (Geology) Project Manager, w hole report, CP
Yanfang (Bonnie) Zhao Principal  Consultant (Geology) Geology, M ineral Resource Estimation
Feng (Frank) Li Principal Consultant (Geology) Data Verification and QA/QC
Mingyan Wang Consultant (Geology) Geology, Mineral Resource Estimation
Huaixiang (Hubert) Li Senior Consultant (Geology) Geology, Miner al Resource Estimation
Shaobo Dai Senior Consultant (Geology) Geology, Mineral Resourc e Estimation
Falong Hu Principal Consultant (Mining) Mining and Ore Reserve Rev iew
Tzuhsuan Chuang Senior Consultan t (Mining) Minin g, Ore Reserve Estimation
Erwei Lu Consultant (Mining) Mining, Ore Reserve Estimation
Alexander Thin Principal Consult ant (Mining) Mining and Ore Res erve Review
Xiangfeng Yang Senior Consultant (Processing) Processing and Meta llurgical Review
Chao Ding Consultant (Processing) Processing Review
Lanliang Niu Principal Consultant (Processing) Processing and Met allurgical Review
Nan Xue Principal Consultant (Environment) Environment, Social,  and Permitting
Meining (Ivy) Dai HSQ and Project Coordinato r Project Coordination and Translation
Pengfei Xiao Principal Consultant (Geology) Internal Peer Revie w and Quality Control
Dr Yonglian Sun Corporate Consult ant (Mining) Internal Peer Revie w and Quality Control
Yiefei Jia, PhD, FAusIMM (CP Geo),  is a Principal Consultant (geology) with a specialty of
exploration of mineral deposits. He has more than 25 years’ exp erience in the field of exploration,
development, and Mineral Resources estimate of precious metal (gold, silver, and PGE), non-ferrous
metal (lithium, lead, zinc, copper, vanadium, titanium, cobalt and nickel), and black metal (iron and
manganese) as well as non-metallic metal (potash, fluorite and graphite) and decorative stone
(marble) ore deposits in different geological settings in Australia, Africa, China, and North and Central
– IIIA-67 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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America. He also has over five years’ experience in coal deposi ts exploration and due diligence in
China, Indonesia and Mongolia. He has extensive experience in p roject management, exploration
design and Mineral Resource assessment.  In recent years, he, as Competent Person, has led and
coordinated dozens of due diligence projects with technical rep orts either for fund raising or listing
on overseas stock exchanges, such as the Stock Exchange of Hong  Kong Limited.  Dr. Jia is
responsible for the whole report. Dr. Jia is qualified as a Competent Person with regard to the type
of deposit and the activity undertaken.
Yanfang Zhao (Bonnie), MEng, MAusIMM; Senior Consultant (Geology). Before joining SRK, she
worked in Silvercorp Metals Inc. and was mainly responsible for data processing, resource modeling
and reserve estimation for operational mines and exploration pr ojects. Bonnie joined SRK China in
2012 and has been involved in more than 50 mining projects in the aspect of data verification,
resource modeling and reserve estimation, due diligence and pre paring Qualified Person Report in
China, Mongolia, Indonesia, Zambia, DRC, Angola and Australia with minerals including Au, Ag, Cu,
Fe, Pb, Zn, and Coal. At SRK, she participated in several successful cases in recent years, and most
of them have completed acquisition or public listings in stock exchanges, including China Unienergy
IPO Listing on HKEx, Agritrade Resource major acquisition of a coal mine in Indonesia, and CNMC
African project. Bonnie is expertized in data processing, resource modeling, reserve estimation and
independent technical reporting. She is proficient in using mining software, including Surpac, Minex,
Leapfrog, ArcGIS, and AutoCAD. Ms. Zhao is responsible for the geology and Mineral Resource
estimation Review.
Huaixiang （（ Hubert) Li,  MEng,  MAIG, is a senior consultant (geology) with SRK China. He
graduated from the China University of Geosciences (Beijing) an d used to work in a geological
exploration company for more than 6 years and gained lots of experiences and expertise in geological
and Mineral Resources exploration. As a consulting geologist, he has participated a number of metal
mineral projects, including expl oration design review, data ver ification, due diligence reviews and
Mineral Resource estimation. He is familiar with the principles  and methods for metal ore deposits
prospecting and exploration incl uding lithium, gold, silver, PG E, REE, copper, lead, zinc,
molybdenum, bauxite, etc. He is proficient in geological modelling, Mineral Resources estimation,
data processing and GIS/RS application. Mr. Li is responsible for the geology and Mineral Resource
estimation Review.
Mingyan Wang, BMgt, is a Consultant (Geology) with SRK China, Prior to join ing SRK in 2022, he
was employed it China Geo-Engineering Corporation., where he fo cused on ecological restoration
design and comprehensive land management. At SRK, his main resp onsibilities include Mineral
Resource modelling and estimation, data processing and map draf ting. He has also served as an
onsite geologist for exploration projects, overseeing geological logging, sampling, and quality control.
Mingyan is proficient in software such as GIS/RS, Surpac, Leapf rog, and AutoCAD. Mr. Wang is
responsible for the geology and exploration review, data processing, Modelling and Mineral
Resource estimation.
TzuHsuan (Shan) Chuang, M.Eng., MAusIMM, is a Senior Consultant (Mining) at SRK China. She
has experience in consulting and operation management. After graduating from Colorado School of
Mines, she conducted scoping studies, pre-feasibility, feasibility studies, and project valuation in Zijin
mining design company, with projects in China, Serbia, Tajikistan, Australia, Colombia, and Guyana.
She then worked at Buritica underground gold mine of Continenta l Gold in Colombia, and was
responsible for LOM plan, produ ction operation, and grade contr ol optimization. Her expertise
includes pit optimization, mine design, and scheduling in metal mine, and is skilled in using Deswik,
– IIIA-68 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 7
Whittle, Surpac, Minesched, and AutoCAD. Ms. Chuang is responsible for mining review and Ore
Reserve estimation.
Erwei Lu,  M.Eng.; Consultant (Mining) at SRK China , he obtained his bachelor’s degree and
master’s degree in mining engineering from Central South Univer sity. He has over five years of
practice of underground operation, and about one year’s mineral  project evaluation experience. He
worked as an on-site mining engineer in Zambia for China Nonferrous Metal Mining (Group) Co., Ltd.
after graduation in 2017. He also worked for an autonomous driving application and mineral project
investment companies since 2022. He is familiar with large scal e underground mobile equipment
operation and training, long-hole blasting, mine design and scheduling, and production management,
as well as autonomous driving application in open pit mine, and  project evaluation. Ms. Chuang is
responsible for mining review and Ore Reserve estimation.
Falong Hu, MBA, B.Eng., FAusIMM, Chinese Certified Mine Constructor, Chinese Certified
Mineral Right Value, Chinese Certified Consulting Engineer (Investment) , is a Principal
Consultant (Mining). He obtained his bachelor’s degree in minin g engineering from Central South
University and Master of Business Administration (MBA) in China University of Geosciences (Beijing).
Before joining SRK he worked as an on-site and head office mini ng engineer in 2 different
international mining companies which were called Sino Gold Mini ng Limited (later merged with
Eldorado Gold Corp.) and Silvercorp Metals Inc. He is familiar with underground and open pit mines’
production systems and has been involved in mining engineering and development design,
scheduling, long-hole blasting and production operation, rock m echanics, ventilation, back-fill; and
cost accounting. After take part in SRK, he accumulated extensive experience in ore reserve
estimation, economic analysis, project valuation, mining assess ment, scoping/pre-
feasibility/feasibility studies and so on. Minerals include gold, silver, lead, zinc, copper, iron, bauxite,
laterite-nickel, sylvine, phosphate and graphite, as well as quartzite, marble, bentonite and so on. He
is a modeler on both technical and economic and also proficient in digital modeling by using Surpac,
Whittle, Minesched, Datamine and AutoCAD. Mr Hu provided a review on mining and Ore Reserve
Estimates.
Xiangfeng Yang, MEng; MAusIMM, Chinese Certified Constructor (Mining Engineering and
Mechanical and Electrical Engineering), Registered Cost Engineer, Chinese Certified Mineral
Right Value, is a senior consultant (proce ssing) at SRK China. She graduat ed from Wuhan
University of Technology in 2010. During her undergraduate and master's studies, she systematically
learned the relevant knowledge of non-ferrous metal ore and non-metal ore separation process and
mineral processing plant design. She has been engaged in feasib ility research, preliminary design
and construction drawing design at Bluestar Lehigh Engineering Institute and NMS. She has
published several journal papers and utility models and has led  and participated in many medium
and large phosphate mines, potassium salt, sulphide ore and other processing projects. She has rich
experience in the design of processing programs such as salt an d sulphide ore and has rich
experience in the selection of mineral processing equipment, bi dding and procurement, the design
of mineral processing technology plans, as well as the configur ation of processing workshops. Ms
Yang is responsible for processing and Metallurgical review.
Nan Xue, M.Sc, MAusIMM, is a Principal Environmental Consultant with SRK Consulting China Ltd.
He holds a master’s degree in environmental sciences from Nankai University in Tianjin. He has four
years’ experience in environmental impact assessment, environmental planning, and environmental
management. He has been involved in a number of large EIA projects and pollution source surveys
– IIIA-69 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Program Objectives and Work Program   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 8
for SINOPEC, as well as the environmental planning project fund ed by UNDP. He has particular
expertise in construction project engineering analysis, polluti on source calculations, and impact
predictions. In recent years after he joined SRK, Nan Xue has b een involved in a number of due
diligence projects, such as the Fuguiniao Mining project in Chi na. Mr. Xue has reviewed the
environment, permits and approvals.
Pengfei Xiao, MSc, MAusIMM, MAIG, is the Managing Director of SRK China. He is a Principal
Consultant (Geology) with a specialty in mineral exploration applying comprehensive geological and
geophysical methods; and his expertise also includes resource m odelling and estimation. He is
familiar with both theory and pr actice in sampling, sample prep aration and chemical analysis. As a
consulting geoscientist, he has been active in mining projects including due diligence reviews,
exploration design, data verifica tion and resource estimation i n China, Mongolia, Africa, America,
Southeast and Central Asia. His experience relates precious metal (Au, Ag, PGE), base metal (Cu,
Ni, Pb, Zn) and other metal deposits (Fe, Mn, V, Mo, Co), and also includes a few non-metal projects
(phosphorite, potash, gypsum). In the past ten years he has bee n working in geology and resource
assessment with SRK, and co-autho red dozens of technical report s aiding clients in successful
property transactions; and more than half of them are published  in stock exchanges. Mr Xiao is
responsible for the internal peer review to ensur e the quality of the Repo rt meeting the required
standard.
Dr Yonglian Sun, BEng, PhD, FAusIMM, FIEAust, CPEng, is a Corporate Consultant (Geotech)
with over 25 years’ experience in geotechnical and mining engin eering in five countries across four
continents. He has extensive international mining experience with an emphasis on site investigation,
analysis, and modelling of geotechnical issues in open pits, un derground mines, and civil tunnels.
He also possesses considerable experience in evaluating mining projects. In recent years, Yonglian
has coordinated and led dozens of due diligence projects, most of which have been successfully
listed in the Stock Exchange of Hong Kong Limited. Dr Sun provided internal peer review to ensure
the quality the report meets the required standard.
2.8 Warranties
Chifeng Gold has warranted to SRK that full disclosure has been  made of all material information
and that, to the best of their knowledge and understanding, suc h information is complete, accurate
and true. SRK has no reason to doubt these warranties.
2.9 Compliance Statement
The information in this report that relates to Mineral Resources/Ore Reserves is based on information
compiled by Dr. Yiefei Jia, a Competent Person who is a Fellow of AusIMM and a Chartered
Professional in Geology (CP Geo), and Mr Falong Hu, a Competent Person who is a Fellow of the
AusIMM. Both are full-time employees of SRK.
This Report is a Competent Person’s Report in line with the Listing Rules of the Exchange and HKEX.
Dr. Yiefei Jia and Mr Falong Hu have sufficient experience that is relevant to the style of
mineralisation and type of deposit under consideration and to the activity being undertaken to qualify
as a Competent Person as defined in the JORC Code”.
– IIIA-70 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Program Objectives and Work Program   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 9
Dr. Yiefei Jia and Mr Falong Hu consent to the inclusion in the  report of the matters based on their
information in the form and context in which it appears.
Peer review and quality control of the Report were conducted by  Mr Pengfei Xiao, MAusIMM, a
Principal Consultant (Geology) and Dr Yonglian Sun, FAusIMM (CP Eng), a Corporate Consultant
(Mining).
2.10 Independence Statement
Neither SRK nor any of the authors of this Report have any material present or contingent interest in
the outcome of this Report, nor do they have any pecuniary or other interest that could be reasonably
regarded as being capable of affecting their independence or that of SRK.
SRK’s fee for completing this Report is based on its normal pro fessional daily rates plus
reimbursement of incidental expenses. The payment of that professional fee is not contingent upon
the outcome of the Report.
SRK has no prior association with Chifeng Gold or Chifeng Gold’ s employees or in regard to the
mineral assets that are the subj ect of this Report. SRK has no beneficial interest in the outcome of
the technical assessment being capable of affecting its indepen dence. SRK is independent of
Chifeng Gold applying all of the tests in 18.21 and 18.22 of th e Listing Rules of the Exchange and
HKEX.
2.11 Consent
SRK consents to this Report being included, in full, in documen ts that Chifeng Gold proposes to
submit to the HKEX and/ or disclo sure to the public markets, in  the form and context in which the
technical assessment is provided, and not for any other purpose.
SRK provides this consent on the basis that the technical asses sments expressed in the Executive
Summary and in the individual sections of this Report are considered with, and not independently of,
the information set out in the complete Report and the Cover Letter.
2.12 Forward Looking Statement
Estimates of Mineral Resources, Ore Reserves, and mine production are inherently forward-looking
statements, which being projecti ons of future performance will necessarily differ from the actual
performance. The errors in such projections result from the inherent uncertainties in the interpretation
of geologic data, in variations in the execution of mining and processing plans, in the inability to meet
construction and production schedules due to many factors inclu ding weather, availability of
necessary equipment and supplies, fluctuating prices, ability of the workforce to maintain equipment,
and changes in regulations or the regulatory climate.
The possible sources of error in the forward-looking statements are addressed in more detail in the
appropriate sections of this report. Also provided in the report are comments on the areas of concern
inherent in the different areas of the mining and processing operations.
– IIIA-71 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Property Description and Location    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 10
3 Property Description and Location
3.1 Property Location
The Jilong, Huatai, Wulong and Hanfeng projects are operating gold and/or polymetallic mines with
associated ore processing and metallurgical plants and exploration tenements, which are located in
Inner Mongolia, Liaoning and Jilin provinces, northeast part of China (see Figure 3-1).
Figure 3-1: General Location Map of the Project (northeast part)

The property of Jintai Project is located in Yunnan province, southwestern part of China (Figure 3-2).
Figure 3-2: General Location Map of the Project (southwestern part)
– IIIA-72 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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3.1.1 Jilong Project
The Jilong gold project is located about 21km west of Aohanqi o r 58km west of Chifeng City, Inner
Mongolia. Chifeng City has extensive networks of railway line a nd well paved highways and is also
about 400km northeast of Beijing. The Zhuanshanzi operating gold mine and exploration permits are
administered by Sidaowan Township ( 四道湾镇) of Aohanqi. The central geographical coordinates
of the Jilong Project are longitude 119º36′5.02587″E and latitude 42º18′19.94458″N (2000 National
Geographic Coordinate System).
3.1.2 Huatai Project
The Huatai gold project is located approximately 33~38km west o f Chifeng City, Inner Mongolia.
Three operating mines of the Lianhuashan gold mine, Honghuagou gold mine and Pengjiagou gold
mine, and exploration permits are administratively under the jurisdiction of Wangfu Township ( 王府
镇), Songshan District of Chifeng City. The project’s central geographical coordinates are longitude
118º35′12″E and latitude 42º14′23″N (1980 Xi’an Geographic Coordinate System).
3.1.3 Wulong Project
The Wulong gold project is located about 15km west of Dandong C ity, Liaoning Province. The
Wulong operating gold mine and the Haojingou-Ligunzi exploratio n permit are administered by
Zhen’an District of Dandong City. The project’s central geograp hical coordinates are longitude
124º11′53″E and latitude 40º09′44″N (1980 Xi’an Geographic Coordinate System).
3.1.4 Hanfeng Project
The Hanfeng polymetallic project is located approximately 42km of northwest of Longjing City, Jilin
Province. The Hanfeng polymetallic project consists of two mining areas (i.e., the Lishan-Xinxing and
Dongfeng mining areas). Administratively, the Tianbaoshan lead- zinc mine and the Dongfeng
exploration permit are under the jurisdiction of Laotougou Town ship ( 老头沟镇), Longjing City,
Yanbian Korean Autonomous Prefect ure. The project’s central geo graphical coordinates are
longitude 128º58′30″E and latitude 42º56′25″N (1980 Xi’an Geographic Coordinate System).
3.1.5 Jintai Project
The Xidengping gold mine, located southwest of Eryuan County, is administered by Liantie Township
(炼铁乡) of Eryuan County (洱源县), Dali Bai Autonomous Prefecture (大理白族自治州). The project’
s central geographical coordinates are about longitude 99º48 ′12″E and latitude 25º59 ′58″N (2000
National Geographic Coordinate System).
3.2 Mineral Tenure
SRK relies on the information provided by the Company, and SRK did not conduct a legal due
diligence review of the Project since such work is outside the scope of SRK’s technical review.
– IIIA-73 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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3.2.1 Jilong Project
Two mining licenses and one exploration permit are currently he ld by Jilong Mining. Details of the
mining licenses and exploration permits for the Project are pre sented in Table 3-1 and Table 3-2,
respectively.
Table 3-1: Information of M ining Licenses, Jilong Mining
Company Chifeng Jilong Mining Co., Ltd.
Project Name Zhuanshanzi Gold Mine, Chifeng Jilong Mining Co., Ltd
License No. C1500002009114120054250
Issued To Chifeng Jilong Mining Co., Ltd.
Issued By  Department of Natural Resources of Inner Mongolia Autonomous Region
Period of Validity May. 1, 2024 – Sep. 26, 2026
Area (km2) 8.61
Mining Type Underground
Mining Depth From 700m to -671m
Production Rate (tpa) 180,000
Project Name Aohanqi zhuanshanzi Gold Mine, Chifeng Jilong Mining Co., Ltd
License No. C1500002023124210156146
Issued To Chifeng Jilong Mining Co., Ltd.
Issued By  Department of Natural Resources of Inner Mongolia Autonomous Region
Period of Validity Dec. 27, 2023 – Mar. 27, 2032
Area (km2) 9.134
Mining Type Underground
Mining Depth From 737m to 373m
Production Rate (tpa) 60,000
Table 3-2: Information of Explo ration Tenements, Jilong Mining
Company Chifeng Jilong Mining Co., Ltd.
Company Chifeng Jilong Mining Co., Ltd.
Project Name Exploration surrounding Zhuanshanzi Gold Mine, Aohanqi, Inner Mongolia
Permit No. T1500002008044010006035
Issued To Chifeng Jilong Mining Co., Ltd.
Issued By  Department of Natural Resources of Inner Mongolia Autonomous Region
Period of Validity Mar. 25, 2021 - Mar. 24, 2026
Area (km2) 3.83
3.2.2 Huatai Project
Six mining licenses are currently held by Huatai Mining. Details of the mining licenses for the Project
are presented in Table 3-3, respectively.
Table 3-3: Information of Min ing Licenses, Huatai Mining
– IIIA-74 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Property Description and Location    Final
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Company Chifeng Huatai Mining Co., Ltd.
Project Name #26 Vein in Lianhuashan Gold Mine, Chifeng Huatai Mining Co., Ltd.
License No. C1500002015114210140451
Issued To Chifeng Huatai Mining Co., Ltd.
Issued By  Department of Natural Resources of Inner Mongolia Autonomous Region
Period of Validity Nov. 18, 2024 - Nov. 17, 2025
Area (km2) 0.3199
Mining Type Underground
Mining Depth From 815m to 467m
Production Rate (tpa) 30,000
Company Chifeng Huatai Mining Co., Ltd.
Project Name #3 &7 Vein in Lianhuashan Gold Mine, Chifeng Huatai Mining Co., Ltd.
License No. C1500002013094210131353
Issued To Chifeng Huatai Mining Co., Ltd.
Issued By  Department of Natural Resources of Inner Mongolia Autonomous Region
Period of Validity Mar. 11, 2024 - Sep. 5, 2025
Area (km2) 1.0164
Mining Type Underground
Mining Depth From 942m to 206m
Production Rate (tpa) 60,000
Company Chifeng Huatai Mining Co., Ltd.
Project Name #5 Mining Area in Lianhuashan Gold Mine, Chifeng Huatai Mining Co., Ltd.
License No. C1500002011014140119663
Issued To Chifeng Huatai Mining Co., Ltd.
Issued By  Department of Natural Resources of Inner Mongolia Autonomous Region
Period of Validity Sep. 15, 2024 - Sep. 14, 2027
Area (km2) 0.8138
Mining Type Underground
Mining Depth From 750m to -325m
Production Rate (tpa) 60,000
Company Chifeng Huatai Mining Co., Ltd.
Project Name #86 Vein in Honghuagou Gold Mine, Chifeng Huatai Mining Co., Ltd.
License No. C1500002015114210140450
Issued To Chifeng Huatai Mining Co., Ltd.
Issued By  Department of Natural Resources of Inner Mongolia Autonomous Region
Period of Validity Nov. 17, 2015 - Nov. 17, 2025
Area (km2) 1.8332
Mining Type Underground
Mining Depth From 753m to 334m
Production Rate (tpa) 30,000
Company Chifeng Huatai Mining Co., Ltd.
Project Name #1 Mining Area in Honghuagou Gold Mine, Chifeng Huatai Mining Co., Ltd.
License No. C1500002009064120021513
Issued To Chifeng Huatai Mining Co., Ltd.
Issued By  Department of Natural Resources of Inner Mongolia Autonomous Region
Period of Validity 1 Jun. 06, 2024 - Jun. 05, 2044
Area (km2) 2.7978
Mining Type Underground
Mining Depth From 870m to -224m
Production Rate (tpa) 60,000
– IIIA-75 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Company Chifeng Huatai Mining Co., Ltd.
Company Chifeng Huatai Mining Co., Ltd.
Project Name Pengjiagou Gold Mine, Chifeng Huatai Mining Co., Ltd.
License No. C1500002015114210140449
Issued To Chifeng Huatai Mining Co., Ltd.
Issued By  Department of Natural Resources of Inner Mongolia Autonomous Regio
Period of Validity 1 Nov. 18, 2023 - Nov. 17, 2025
Area (km2) 3.7362
Mining Type Underground
Mining Depth From 829m to 260m
Production Rate (tpa) 30,000
3.2.3 Wulong Project
One mining license and two exploration permits are currently held by Wulong Mining. Details of the
mining license and exploration pe rmits for the Project are pres ented in Table 3-4 and Table 3-5 ,
respectively.
Table 3-4: Information of M ining License, Wulong Mining
Company Liaoning Wulong Mining Co., Ltd..
Project Name Wulong Gold Mine, Liaoning Wulong Mining Co., Ltd..
License No. C2100002011084140116558
Issued To Liaoning Wulong Mining Co., Ltd.
Issued By  Department of Natural Resources of Liaoning Province
Period of Validity Dec. 04, 2020 - Aug. 04, 2035
Area (km2) 6.2732
Mining Type Underground
Mining Depth From the surface to -750m
Production Rate (tpa) 100,000
Table 3-5: Information of Exp loration Tenement, Wulong Mining
Company Liaoning Wulong Mining Co., Ltd.
Project Name Exploration of Haojingou-Ligunzi Gold Deposit in Dandong City, Liaoning
Province
Permit No. T2100002008044010006347
Issued To Liaoning Wulong Mining Co., Ltd.
Issued By  Department of Natural Resources of Liaoning Province
Period of Validity Nov. 20, 2024 - Nov. 20, 2029
Area (km2) 3.88
Company Liaoning Wulong Mining Co., Ltd.
Project Name Exploration of Ligunzi Gold Deposit in Dandong City, Liaoning Province
Permit No. T2100002008044010005662
Issued To Liaoning Wulong Mining Co., Ltd.
Issued By  Department of Natural Resources of Liaoning Province
Period of Validity Jun. 2, 2023 - Jun. 2, 2028
Area (km2) 0.6112
– IIIA-76 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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3.2.4 Hanfeng Project
Two mining licenses and one exploration permits are currently h eld by Hanfeng Mining. Details of
the mining license and exploration permits for the Project are presented in Table 3-6 and Table 3-7,
respectively.
Table 3-6: Information of Min ing Licenses, Hanfeng Mining
Company Jilin Hanfeng Mining Technology Co, Ltd.
Project Name Lishan Mining Area in Tianbaoshan Lead-Zinc Mine, Hanfeng Mining
Mining License No. C2224002021083210152512
Issued To Jilin Hanfeng Mining Technology Co, Ltd.
Issued By  Yanbian Korean Autonomous Prefecture Bureau of Natural Resources
Period of Validity Aug. 27, 2021 - Aug. 27, 2050
Area (km2) 2.2250
Mining Type Underground
Mining Depth From 564m to -700m
Production Rate (tpa) 600,000
Company Jilin Hanfeng Mining Technology Co, Ltd.
Project Name Dongfeng Mining Area in Tianbaoshan Lead-Zinc Mine, Hanfeng Mining
Mining License No. C2200002010123120093830
Issued To Jilin Hanfeng Mining Technology Co, Ltd.
Issued By  Department of Natural Resources of Jilin Province
Period of Validity Feb. 25, 2025 - Feb. 24, 2030
Area (km2) 2.4207
Mining Type Underground
Mining Depth From 543.77m to 272.16m
Production Rate (tpa) 99,000
Table 3-7: Information of Explo ration Tenement, Hanfeng Mining
Company Jilin Hanfeng Mining Technology Co, Ltd.
Project Name Deep Exploration of Dongfeng Molybdenum Deposit in Tianbaoshan Lead-Zinc Mine
Permit No. T1000002021033028000361
Issued To Jilin Hanfeng Mining Technology Co, Ltd.
Issued By  Ministry of Natural Resources
Period of Validity Dec. 20, 2020 - Dec. 20, 2025
Area (km2) 2.3191
3.2.5 Jintai Project
One mining license and one exploration permit are currently held by Jintai Mining (Figure 3-3). Details
of the mining license and exploration permit for the project ar e listed in Table 3-8 and Table 3-9,
respectively.
– IIIA-77 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Figure 3-3: Locations of the Mi ning and Exploration Licences

Table 3-8: Information of M ining License, Jintai Mining
Company Eryuan Jintai Mining Development Co., Ltd.
Project Name Xidengping Gold Mine, Eryuan Jintai Mining Development Co., Ltd.
License No. C5300002012054110124688
Issued To Eryuan Jintai Mining Development Co., Ltd.
Issued By  Dali Bai Autonomous Prefecture Bureau of Natural Resources and Planning
Period of Validity June 7, 2022 – June 6, 2032
Area (km2) 1.0920
Mining Type Open Pit
Mining Depth 2,060m -1,900m
Production Rate (tpa) 140,000
Table 3-9: Information of Explo ration Tenement, Jintai Mining
Company Eryuan Jintai Mining Development Co., Ltd.
Project Name Advanced Exploration of Xidengping Gold Deposit in Eryuan County, Yunnan Province
Permit No. T5300002009034010026977
Issued To Eryuan Jintai Mining Development Co., Ltd.
Issued By  Dali Bai Autonomous Prefecture Bureau of Natural Resources and Planning
Period of
Validity June 3, 2021 – June 3, 2026
Area (km2) 10.28
3.3 Underlying Agreements
SRK is not aware of any underlying agreements other than those disclosed in this Report.
– IIIA-78 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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3.4 Permits and Authorization
A list of licenses and permits and authorization in Section 3.2  for each of the five subsidiary mining
companies, i.e., Jilong Mining, Huatai Mining, Wulong Mining, Hanfeng Mining and Jintai Mining, to
undertake legal exploration, exploitation, and production in China has been sighted by SRK.
Apart from the mining license, other operational permits are required for the Project according to the
relevant Chinese laws and regulations. These operational permits include:
 Business License,
 Safety Production License,
 Land/forest Use Permit,
 Water Use Permit, and
 Site Discharge Permit
The safety production licenses, water use permits, and site dis charge permits for the five projects
are presented in Section 13.4.
3.5 Environmental Considerations
Environmental liabilities associated with the project operation  are mainly from underground mining,
waste rock dumps, processing pl ant, tailings storage facilities  and other auxiliary  facilities. The
significant inherent environmental risks for the project consis t of environmental approvals, water
management and tailings management. Additional details on envir onmental approvals, water
management and tailings management are provided in Sections 19 of this Technical Report.
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Accessibility, Climate, Local Resources, Infrastructure, and Physiography  Final
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4 Accessibility, Climate, Local Resources,
Infrastructure, and Physiography
4.1 Accessibility
4.1.1 Jilong and Huatai Projects
As shown in Figure 3-1, both Jilong and Huatai projects are located in Inner Mongolia, approximately
58km away from Chifeng City in the west and 33-38km away from Chifeng in the east, respectively.
Chifeng City has extensive networks of railway line and well paved highways and is also about 400km
northeast of Beijing. There are multiple high-speed railways run between Beijing and Chifeng every
day.
Access to both projects is excellent. Jilong Project is only 15km away from the Xiaohe (小河) Station
of Beijing - Tongliao Railway in the north, and Huatai Project’ s properties are all within 3 to 10km
away from the Honghuagou ( 红花沟) Station of Beijing - Tongliao Ra ilway. There are gravel roads
connecting both projects’ properties to the railway station and main paved roads.
4.1.2 Wulong Project
The Wulong project is located in Liaoning Province, about 15km west of Dandong City. Access to
the Wulong gold mine is very convenient. The Dandong-Dalian highway is 11km away from the mine
in the southeast. There are gravel roads connecting the mine to the main paved roads.
4.1.3 Hanfeng Project
The Hanfeng project is located in Jilin Province, approximately 42km of northwest of Longjing City.
Access to the project area is excellent. The Changchun-Tumen Railway and National Highway G302
pass through Laotougou Township in the southeast of Tianbaoshan  mine area. Laotougou Town is
just 15km southeast of the project’s properties and there is a cement road connecting Laotougou
Town and the project site.
4.1.4 Jintai Project
As shown in Figure 3-2, access to the project is convenient. Th e project is in Dali Bai Autonomous
Prefecture of Yunnan province, approximately 3 km away from Lia ntie Township. Liantie Township
is about 51 km away from Eryuan County in the southwest by asph alt road. And Eryuan County is
about 408 km from Kunming, the capital of Yunnan province.
Liantie Township is about 106 km away from Dali going pass Yang bi County. The nearest railway
station is Shangguan Station of Dali - Lijiang Railway. The Xid engping mine is about 78 km to the
Shangguan Station going pass Liantie Township and Eryuan County. There are daily buses between
Eryuan County and Dali going pass Liantie Township. There are g ravel roads connecting the mine
to the main paved roads.
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4.2 Local Resources and Infrastructure
4.2.1 Jilong and Huatai Projects
The region is a typical habitation for Han nationality and mino rities as Mongolian, Hui and others.
The population is not dense but seems enough for mining and oth er industrial activities. The basic
economic activity is dominated by farming, while animal husband ry, handicraft manufacture as well
as mining are secondary industrial activities. The power and co al supplies are quite convenient for
local mining industry.
Jilong Mining has built a 4,000kVA and 6,300kVA general step-do wn substation in the #1 mining
area of the Zhuanshanzi Gold Mine. The power supply comes from the secondary substation (66kV)
of Yuanbaoshan. The power supply with 10kV is sourced from Jilo ng Mining's general step-down
substation and can meet the production needs. Water for product ion and domestic use is sourced
from underground water with a water volume of 70 cubic meters per day (“m3/d”) per water well.  The
wired telephone and mobile communication cover the mining area.
The power supply for the Huatai project is sourced from the Northeast Power Grid, and the industrial
10kv high-voltage line has been connected to the Lianhuashan and Honghuagou gold mining areas,
which can meet both production needs. Water for production and domestic use is sourced from
underground water (electromechanical wells), and the water volume is relatively sufficient. The China
Mobile communication network and China Unicom network have covered the mining area.
4.2.2 Wulong Project
Wulong operating gold mine is an old mining area with complete power supply facilities. The
Northeast Power Grid runs through the whole area, and the power supply is sufficient. The water for
mine production and surrounding residents is taken from the special water intake area of the mining
area, and water resources are relatively sufficient.
4.2.3 Hanfeng Project
Residents in the region are mainly Han and Korean, each accounting approximately for nearly 50%.
The local economy is dominated by agriculture and mining indust ry. Agriculture is mainly based on
corn, rice, and soybean planting. Mining development is a pillar industry in the local area. Hanfeng
Mining’s Tianbaoshan Lead-Zinc Mine is a large profit and tax h ousehold in Longjing City and has
played a positive role in promoting the development of the loca l economy. There is a 110KV high-
voltage dedicated line for Tianbaoshan operating mine, and the power supply can fully meet the
production needs.
4.2.4 Jintai Project
The region is a typical habitation for Bai and the others are Yi, Han, Naxi and Hui. The basic economic
activity is dominated by agriculture and husbandry. Agriculture is mainly based on rice, wheat, corn,
and buckwheat planting. Economic crops include walnuts, roasted  tobacco, chestnuts, etc. More
than 95% of the population is engaged in agriculture, and the e conomy and culture are relatively
backward.
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The Puping hydropower station has been built on the Heihui Rive r in the south of Xidengping mine
and has been incorporated into the State Grid. The national hig h-voltage transmission line passes
through the southern part of the project. The power supply can fully meet the production needs.
The surface water system is re latively developed, which can be introduced by diversion pipe, and
the water quantity and quality can meet the needs of production and living.
4.3 Climate Physiography
4.3.1 Jilong and Huatai Projects
Both Jilong and Huatai projects areas are located in Nuluerhu mountainous area. The topography is
characterised by low to middle mountains or hills, with an elevation ranging from 660 to 844m above
sea level (“asl”) in Jilong project area, and 1,024 to 730m asl in Huatai project area. Climate type in
the region belongs to arid and semi-arid continental climate zone, which is characterized by cold
winter, hot summer and windy in spring and autumn.
Generally, the weather in the project site is cold with a yearly average temperature at approximately
7.0 degree Celsius (°C). The lowest temperature in winter could  be minus 30.7°C, and the highest
temperature in summer can reach 38.7°C. The extremely cold and hot weather usually appears in
December and July, respectively.
The annual precipitation is from 217.6 to 595.1 millimetres (mm), whereas the annual evaporation in
the region is about several times more than the amount of preci pitation, which is from 1.956.0 to
2,836.6mm, with an average of 2.513.5mm. The frost period in the mine area is from late October to
March of the next year, the maximum thickness of frozen earth could reach around 1.5 to 2.0 meter
(m). The annual average wind speed is 2.4m per second (“m/s”), and the maximum wind speed is
17/s.
There is a northwest direction river valley in the west of the Zhuanshanzi gold mine area. Except for
the temporary running water in summer, the river is usually dry . It contains rich groundwater, which
is the main water source of the mine.
There is no surface water body in  the Huatai project area. Abou t 3km away from the Lianhuashan
gold mine in the south, there is a river (i.e., Seluga River), its water volume is small, and the flow is
basically cut off in summer.
According to the Seismic Intensity Parameter Zoning Map of China, the seismic peak acceleration in
both project areas is 0.10 to 0 .15g, which is VII degree. No ge ological disasters, such as landslide
and debris flow are found.
4.3.2 Wulong Project
The topography in the Wulong project area is characterized by mountains and hills with an elevation
ranging from 120m to 606m asl. The terrain is high in the north  and low in the south. The terrain
undulates greatly, and the V-shaped valleys cut deeply.
The water system in the Wulong gold mine area is relatively dev eloped, and most of them are
seasonal gullies. The mine area is located in the southeast of the Liaodong Peninsula, belonging to
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the northern temperate marine climate zone, with four distinct seasons. The annual average
temperature is at the range from 8.3 to 10.3°C. The lowest extreme temperature in winter is -25.1°C,
and the highest extreme temperature is 34.1°C in summer. The average annual precipitation is 656
mm, mostly concentrated in July and August. There are more north or northwest winds in winter, and
more south or southeast winds in summer. The maximum thickness of frozen earth is 1.07m, and
the frost-free period is 185 days.
4.3.3 Hanfeng Project
The Hanfeng project area is located in the northern extension o f the Yingering Mountains in the
Changbai Mountains. The terrain is high in the northwest and lo w in the southeast. The mountains
are generally north-northwest direction, with many peaks, steep mountains, and narrow "V"-shaped
valleys. Generally, the altitude of mountain peaks ranges from 500m to 800m asl, with a relief of
about 300-500m. The main peak in the area is Tianbao Mountain, with an altitude of 1073m asl, and
the lowest erosion datum is about 350m.
The Tianbaoshan lead-zinc mine area has a temperate continental  climate, with large seasonal
temperature differences. The annual highest temperature is concentrated in July to August, with an
average temperature above 20°C, and the lowest temperature in J anuary can reach below -30°C.
July to August is the rainy season, with an average annual precipitation of 800-900mm. The freezing
period is from late November to mid-April of the next year, and the thickness of the frozen soil layer
can reach 1.5m.
The rivers in the project area belong to the Buerhatong River basin of the Tumen River system. The
rivers mainly include Tianbaoshan River, Jiuhudong River, and Chencaigou River, which originate in
Tianbaoshan, flow southeasterly into the Burhatong River at the Huxiantang area. The drainage area
of Tianbaoshan River is 8.7km2, with a general flow rate of 301.1 litters per second (“l/s”), and a flow
rate of 585-641l/s in wet season, which can meet the mine production and domestic water needs.
4.3.4 Jintai Project
The project area is located in the west of the Luoping-Diancang Mountains (trending north-south) in
Hengduan Mountain, western Yunnan, and in the east bank of Heihui River. The terrain is high in the
northeast and low in the southwest.  Generally, the terrain is a gentle slope, with an elevation of
1,800 ~ 2,300 m ASL. The erosion landform is generally gently s loping to the west (Heihui River),
and the average slope is about 10°.  The terraces can be roughl y divided into 5 levels, the slope of
the steps is about 25°, the steps are flat, and most of them are cultivated land.  The slope of the left
bank of Heihui River is about 35° ~ 45°. The west slope of Luop ing Mountain is a steep slope with
an elevation of 2,300 ~ 2,900 m asl, among which the area with an elevation of 2,300 ~2,500 m asl
is the remaining terrace landform, with a lot of tongue strip protruding ridges.
The project area has a north subtropical plateau monsoon climate, the highest temperature is 30ºC,
the lowest temperature is -5ºC, the average annual temperature is 13.9ºC.  The average annual
rainfall is 1,200 mm, the maximum rainfall is 1,440.5mm, and the maximum rainfall in 24 hours is 89
mm.  May to October is the rainy season, the precipitation accounts for more than 80% of the year.
Annual average evaporation of 1,405.7 mm, frost-free period for about 280 days, occasional heavy
snow, as well as local areas of hail, is the main disastrous climate in the area.  The wind direction in
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the area is mainly northwest with an average speed of 2 ~ 8 m/s , and the maximum wind speed at
Luoping Mountain is 35 m/s.
According to Code for Seismic Design of Buildings (GB50011-2001 ) of China, the seismic peak
acceleration in the area is 0.20 g, which is VIII degree. The c haracteristic period of ground motion
response spectrum is 0.45 s, which belongs to unstable region. No geological disasters, such as
landslide and debris flow are found.
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Geological Setting and Mineralisation   Final
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5 Geological Setting and Mineralisation
5.1 Regional Geology
5.1.1 Jilong and Huatai Projects
Tectonically, the Honghuagou-Lianhuashan and Zhuanshanzi gold d eposits are situated at
Lianhuashan fault block in Inner Mongolia platform uplift of North China platform. Regional structures
and magmatic activity are frequent, which provide the source an d conduit for the gold-bearing
hydrothermal fluid, and the secondary structure provides the site for the formation of gold deposits.
The development of tectonic processes and magmatic activities a re favourable for the formation of
gold mineralisation.
The Paleozoic strata of Honghuagou-Lianhuashan and Zhuanshanzi gold deposits belong to Chifeng
stratigraphic unit of the Inner Mongolia grassland stratigraphi c zone in North China stratigraphic
region. The Mesozoic and Cenozoic strata belong to Ulanhot-Chifeng stratigraphic unit of the Greater
Khingan-Yanshan stratigraphic zone in the Coastal Pacific stratigraphic region.
The outcropped strata are Paleoarchean Wulashan Group, Proteroz oic Great Wall System, Xinmin
Formation of Middle Jurassic of Mesozoic, Baiyingaolao Formatio n of Upper Jurassic of Mesozoic,
Jiufotang Formation of Lower Cretaceous, Neogene Miocene Hannuo ba Formation, Quaternary
Pleistocene and Holocene. The Paleoarchean Wulashan Group is th e main strata hosting the
Mineralisation.
Fault structures in the project area are developed, the faults are divided into 4 groups: nearly east-
west, nearly north-south, northwest and northeast trending faults. The northwest trending is the main
faults controlling the gold mineralisation.
Magmatic intrusion is extensive, with multiple stages and compl ex types. Magmatic intrusive rocks
include Jurassic granite-porphyry, monzo-granite and Alkali-Feldspar Granite.
5.1.2 Wulong Project
Geotectonically, the Wulong project is located in the eastern m argin of North China Block. The
eastern part of the North China Block is comprised of Longgang block, Shandong-Liaoning-Jilin
orogenic belt and Langlin block (Figure 5-1). There are a numbe r of large and super-large deposits
distributed in eastern area of Shandong, eastern area of Liaoning, western area of Henan, northern
and eastern area of Hebei, and southern area of Jilin (Zhu et al., 2015).
The strata in the eastern area of Liaoning are mainly composed of Precambrian metamorphic rocks
and Mesozoic volcanic and intrusive rocks (Yang et al., 2003). The Precambrian rocks mainly consist
of the Paleoarchean diorite, quartz diorite, and granodiorite and the Paleoproterozoic Liaohe Group,
mainly composed of intermediate and low-grade metamorphic rocks , including various types of
schist, gneiss, dacite and amphibolite.  The Neoproterozoic and  Mesozoic thick sedimentary rocks
are sporadically outcropped in the area.
In the Mesozoic, the eastern area of Liaoning became an importa nt part of the circum-Pacific
tectonic-magmatic belt, producing a large area (2,000 km 2) of granite and volcanic rocks, which
intruded into the Precambrian metamorphic rocks. The Mesozoic magmatism of the eastern area of
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Geological Setting and Mineralisation   Final
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Liaoning was divided into three phases: the Triassic (210~231 M a) alkaline rocks, diorite and
monzonitic granite; the Jurassic (153-180 Ma) quartz diorite, diorite, and gneissic monzogranite; and
the Cretaceous (120-131 Ma) diorite, granodiorite, monzonite and lamprophyre, dolerite dykes. The
Early Cretaceous magmatism occurred in the context of regional extensional disruption of the North
China Block, which led to the formation of large-scale gold Mineralisation in the region (Zhai Mingguo
et al., 2003).
Figure 5-1: Regional Geology  Setting of Wulong Project

Sources: Modified after Zhang et al. (2015).
5.1.3 Hanfeng Project
The large-scale Tianbaoshan metallogenic region, with over one hundred years of mining history, is
located in eastern Yanbian area, north-eastern China. There are  abundant nonferrous metal
resources and diverse deposit types, metallogenic theory and or e-prospecting in the Tianbaoshan
region. According to the recent research data, the Yanbian area belongs to the Paleo-Asian Ocean
tectonic region during the Paleozoic Era and to the Paleo-Pacif ic Ocean tectonic region since the
Jurassic period. Evolution and superimposition of the two tecto nic regions resulted in multi-cyclic
tectonic-magmatic activities and provided a beneficial ore-form ing geological condition to the
intensive nonferrous and precious metal Mineralisation in this area. Up to now, at least four types of
deposits have been discovered, including skarn lead-zinc deposi t (i.e., Lishan deposit and
Xuanchanghoushan deposit), crypto-explosive breccia lead-zinc-silver deposit (i.e., Xinxing deposit),
sedimentary metamorphic-hydrothermal copper-lead-zinc deposit ( i.e., Dongfengnanshan deposit)
and lode (-porphyry) molybdenum deposit (i.e., Dongfengbeishan deposit). The regional geology
setting is shown as Figure 5-2.
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Figure 5-2: Regional Geology Setting of Hanfeng Project

1-Quaternary; 2-Lower Jurassic Mingyuegou Formation; 3-Permian Miaoling Formation; 4-Carboniferous Tianbaoshan Group;
5-Silurian Qinglongcun Group; 6-Hercynian intrusive rocks; 7-In dosinian intrusive rocks; 8-Yanshanian intrusive rocks; 9-
granite; 10-biotite granite; 11-alkali-feldspar granite; 12-gra nite diorite; 13-quartz diorite porphyry; 14-diorite; 15-quartz
porphyry; 16-sub and site; 17-deposit; 18-compresso-shear fault; 19-transtensional fault; 20-inferred compressor-shear fault;
21-inferred trans tensional fault
Sources:  Superimposed Mineralisation of the Tianbaoshan metallogenic region in Yanbian area (eastern Jilin Province), north-eastern
China: Indicated by the isotopic dating. Acta Petrologica Sinica, 30(7): 2081-2091 (in Chinese with English abstract)
5.1.4 Jintai Project
The Jintai Project is located in the eastern edge of the Changd u-Lanping-Simao block of the
Qiangtang-Sanjiang orogenic system and is adjacent to east of t he Diancang – Yuanlao Mountain
metamorphic basement complex of the upper Yangtse paleo platfor m. The project is in the
combination area of two primary tectonic units, Qiangtang-Sanji ang orogenic system and Yangtse
platform. The regional metallogenic zone belongs to the coastal  Pacific metallogenic domain, the
upper Yangtse platform metallogenic province, the middle part of the Lijiang-Dali-Jinping Au-Cu-Ni-
Pt-Pd-Mo-Mn-Fe-Pb-Zn mineral belt. With complex geological structure, frequent magmatic activity
and strong Mineralisation, the area is a favourable location fo r searching for gold polymetallic
deposits related to the tectono-magmatic activity in the Himalayan period.
The outcropped strata in the east part of the Qiaohou - Yangbi Fault are the Paleoproterozoic
Huanglongtan Formation and Shimengguan Formation, the Neoproterozoic Luopingshan Formation,
and the Permian Maokou Formation and Wulongba Formation. The ou tcropped strata in the west
part of the Qiaohou - Yangbi Fault are the Cretaceous Jingxing Formation, Nanxing Formation and
Hutousi Formation, the Paleogene Yunlong Formation and Baoxiangsi Formation and the Neogene
Sanying Formation. The Quaternary is commonly seen in rivers slopes and gullies in the region.
The regional tectonic structure is roughly separated by the Qiaohou-Yangbi Fault, with the Mesozoic
depressional basin of Lanping to the west, the Cenozoic slip pu lling basin of Qiaohou-Liantie
superimposed on the eastern edge of the basin, and the crystalline metamorphic basement (orogenic
belt) of the Luoping Mountain Goutoujing Group to the east. The  tectonics in the region is
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characterized by multi-period inherited activities, and the reg ional tectonic structure is generally
north-northwest trending.
There are two sets of faults in the region, one is trending nor thwest-southeast, and the other is
trending northeast-southwest. The northwest-southeast fault is the main fault in the region, which
controls the whole regional tectonic structure and controls the regional geohistorical evolution. The
eastern northwest-southeast fault is mainly developed in the an cient metamorphic rocks of the
metasedimentary boundary, characterized by multi-stage activity, ductile in the first stage and brittle
rupture in the later stage; the western northwest-southeast fault is mainly developed in the Mesozoic
strata, characterized by low angle and brittle rupture, mostly positive faults with torsion. From the
intersection relationship, the northwest-southeast faults are c ut and staggered by the northeast-
southwest faults; the northeast-southwest fault is obviously new. The northeast-southwest faults cut
through the stratigraphy of the Sanying Formation of Pliocene, indicating that the last activity of the
faults was later than the Pliocene.
The regional folding is divided into two parts, east and west. The western part is a fold composed of
Mesozoic and Cenozoic strata and the eastern part is an anticline and monoclinal fold composed of
schist in ancient metamorphic rocks. The western part of the folds is, the Changyi compound syncline
and its subordinate anticline and syncline, the Heihui River co mpound syncline and its subordinate
anticline and syncline. The Heihui River compound syncline is the norther extension of the Changyi
compound syncline. The eastern fold is composed of the Lujiacun  metamorphic-tectonic schist
antiform and the Dayeping monoclinal fold.
The intrusive rock in the region is the Variscan gabbro outcrop ped in the north part of Dayeping,
intruding into Wulongba Formation. The gabbro is trending north west - southeast and generally
consistent with the regional tectonic structure. It is cut off by the north-east fault to the northwest and
covered by the Quaternary to the southeast. The rock outcrop is about 2,300m long and 250m wide,
and it is a rock wall. The lithology is norite gabbro. The rocks have semi-automorphic granular texture
and blocky structure. Near the Qiaohou-Yangbi Fault, there are vein rocks such as granite porphyry,
diabase, monzonite porphyry.
There are three types of metam orphic rocks, regional metamorphic rocks, dynamic metamorphic
rocks, mixed rocks, and hydrothermal metamorphism (alteration). Metamorphism is more complex.
Soil geochemical surveys at sca les of 1:200,000 and 1:50,000 ha ve been carried out in this area.
The results show that most of the gold anomaly are in the distr ibution area of sand, gravel and
mudstone of the Sanying Formation.
Gold mineralisation in the metallogenic zone is closely related  to Himalayan tectonics and alkaline
magmatic activities, and there are mainly two types of deposits, porphyry, and shear zone. Porphyry
gold deposit is represented by Heging Beiya, Xiangyun Machangji ng and Jinping Chang'an, and
shear zone gold deposit is represented by Yuanyang Daping.

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5.2 Property Geology
5.2.1 Jilong Project
The outcropped strata in the Zhuanshanzi Mine, including both Zhuanshanzi Block and Zhuanshanzi
#4#5#6#7 Block areas are the Lower Permian Yujiabeigou Formatio n, the Upper Jurassic
Baiyingaolao Formation and the Quaternary sediments.  Figure 5-3 shows the local geology setting
of the Zhaunshanzi Mine.
Figure 5-3: Local Geology Map of Zhuanshanzi Mine

The Lower Permian Yujiabeigou Formation strikes northeast (30º-70º) and dips to southeast with a
dip angle of between10° and 90°. The thickness of this formation is 500m. This formation is divided
into three members: the lower member is at the central south, a nd consists of crystalline limestone
and layered marble, which is the wall rock of mineralisation. T he middle member is composed of
crystalline limestone and marble, and the lower member includes slate and siltstone.
The Upper Jurassic Baiyingaolao Formation is a set of continental intermediate-felsic volcanic lava
and pyroclastic rocks, including rhyolite, andesite, amygdaloid  andesite, rhyolitic tuff, and andesitic
tuff. The formation strikes northeast and dips to southeast with a dip angle of 50º-70º. The thickness
of this formation is 700m.
The Quaternary sedimentary series include loess-like loamy soil , loamy soil containing calcareous
nodules.
The structure in project area is developed and dominated by fault structure. The faults are developed
at the Yanshan period and can be divided into three groups: nor thwest, nearly east west, northeast
trending faults. The northwest trending faults host the gold mineralisation.
– IIIA-89 –
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Geological Setting and Mineralisation   Final
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The Intrusive rocks are well developed at the deposit area, the y include early Cretaceous granite,
late Cretaceous granite porphyry, Jurassic and Permian diorites . Dykes include felsite porphyry,
trachyte and quartz vein, which strike northwest, northeast or most east-west.
Wall rock alteration includes p yritization, carbonation, silici fication, chloritization, sericitization,
epidotization.
5.2.2 Huatai Project
Honghuagou #1 Mining Zone
At the Honghuagou #1 Mining Zone area, the outcropped strata in clude the Archean Wulashan
Group, the Lower Cretaceous Jiufotang Formation, and the Quaternary sediments. Figure 5-4 is the
local geology setting.
Figure 5-4: Local Geology Map

Source: SRK
The Archean Wulashan Group is widely outcropped at the #1 Minin g Zone, which is main
mineralisation hosting strata. Lithologically, the Wulashan Gro up is composed of amphibole
plagioclase gneiss, amphibolite, migmatite granite, amphibolite gneiss.
The Lower Cretaceous Jiufotang Formation partially occurs at the middle west of the #3 Mining Zone,
the lithology is mostly tuffaceous sandstone, discontinuous ove rlies above the Archean Wulashan
Group.
– IIIA-90 –
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Geological Setting and Mineralisation   Final
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The Quaternary sedimentary rocks are widely outcropped at the mining area, and lithologically they
are primarily red clay, variegated gravel layer, yellow sub-sandy soil and loess, the thickness is
20~50m.
Fault structures in the #1 Mining Zone area can be divided into four groups: nearly east-west, nearly
north-south, northwest and northeast trending faults. The nearl y north-south trending faults are
branches of the regional faults, which host gold mineralisation. The north-south trending fault dips to
east with a dip angle of 70-80º and controls the #82 Vein. The length and width of this vein is about
330m and 0.5-2.0m, respectively.
Magmatic intrusion doesn’t outcrop at the #1 Mining Zone area, only dykes outcrop as granite
porphyry and diorite porphyrite veins.
Wall rock alteration includes facial and linear shapes. Facial wall rock alterations include potassium
feldspar, albitization, silicification, albite-epidotization, a lbite-zoisitization, s ericitization, pyrite
sericitization and carbonation. Linear wall rock alteration dev elops with hydrothermal replacement,
at the breccia around the gold veins, and the linear wall rock alterations include sericitization,
chloritization, silicification, pyritization, carbonation.
Gold mineralisation bodies develop at the structural breccia as veins. Mineralisation includes pyrite,
pyrrhotite, galena, and sphalerite, which show as disseminated,  veined or reticulated widespread.
The contact between the wall rock and mineralised bodies is clear.
Honghuagou #86 Vein
The strata include the Xiaotazigou Formation of Archean Jianpin g Group, composed of plagioclase
hornblende gneiss, hornblende plagioclase gneiss with magnetite quartz lenticle and marble lens;
the Baiyingaolao Formation of Late Jurassic, consisting of rhyolite and andesite; and the Quaternary
sediments. The fault structures well developed in the property area, they consist of nearly east west,
northeast, northwest, and nearly north south trending faults.
The magmatic activity in the area is strong and frequents at different stages and types. The intrusive
rocks primarily consist of the Honghuagou granite porphyry dykes.
Wall rock is the Xiaotazigou Formation plagioclase hornblende gneiss. Wall rock alterations include
silicification, pyritization, sericitization, chloritization, and carbonation.
Pengjiagou Mine
The strata include the Xiaotazigou Formation of Archean Jianpin g Group and the Quaternary
sediments. The fault structures include northeast and northwest trending faults.
The magmatic intrusive is not developed, only Yanshanian syenite porphyry and dykes is revealed.
Wall rock alterations include pyritization, sericitization, chloritization, and carbonation.
Lianhuashan #5 Mining Zone
At the Lianhuashan #5 Mining Zone area, the outcropped strata i nclude the Archean Wulashan
Group, and the Pleistocene and Holocene Series of sediments.
– IIIA-91 –
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The Archean Wulashan Group is widely outcropped at the #5 Mining Zone area, which is main strata
hosting the gold Mineralisation.  The lithology of the Archean W ulashan Group includes amphibole
plagioclase gneiss, amphibolite, migmatite granite, and amphibolite gneiss.
The Quaternary sediments are mainly red clay, variegated gravel  layer, yellow sub-sandy soil and
loess. The thickness is 60~130m.
Structures in the #5 Mining Zone area can be divided into most east-west, nearly north-south,
northwest trending faults. The nearly north-south trend faults are the branch of regional faults F8 and
F9, which host mineralisation,  and they occur at the central so uth of the #5 Mining Zone area and
control the occurrence of mineralised bodies of #51-1, #51-6, #51-8, #51-9, #51-10.
Magmatic intrusion doesn’t expose at the #5 Mining Zone area, o nly dykes expose as granite
porphyry and diorite porphyrite vein. The dykes do not destroy the mineralisation.
Wall rock alteration includes facial and linear shape. Facial w all rock alterations include potassium
feldspar, albitization, silicification, albite-epidotization, a lbite-zoisitization, s ericitization, pyrite
sericitization and carbonation. Linear wall rock alteration dev elops with hydrothermal replacement,
at the breccia around the gold veins, and linear wall rock alte rations include sericitization,
chloritization, silicification, pyritization, and carbonation.
Gold mineralised bodies develop at the structural breccia as ve ins. Mineralisation includes pyrite,
pyrrhotite, galena, and sphalerite, which show as disseminated,  veined or reticulated widespread.
The contact between the wall rock and mineralised bodies is clear.
Lianhuashan #26 Vein
The outcropped strata include the Xiaotazigou Formation of Arch ean Jianping Group and the
Baiyingaolao Formation of Upper Jurassic. Structures mainly inc lude northwest and nearly north-
south trending faults, and the nearly north south trending faul ts host the gold Mineralisation.
Magmatic intrusive is not developed, only dykes occur.
Wall rock alterations include pyritization, sericitization, chloritization, and carbonation.
Lianhuashan #3&#7 Vein
The outcropped strata include the Xiaotazigou Formation of Arch ean Jianping Group, composed of
plagioclase hornblende gneiss and the Quaternary sediments. Mag matic intrusive is not developed
and only small dykes occur.
Structures mainly include faults at small scale, which host the gold mineralisation.
Wall rock alterations include potassium feldspar, albitization,  quartzitization, Albite~epidote, and
albite~zoisite.
5.2.3 Wulong Project
As shown in Figure 5-5, the char acteristics of the stratigraphy , structures and igneous rocks are
detailed as following.
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Geological Setting and Mineralisation   Final
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The Paleoproterozoic Liaohe Group rocks, layered metamorphic rocks, are sporadically outcropped,
mostly in the form of xenoliths in the Mesozoic granites and mi xed granites distributed over a large
area. The stratigraphy of the area is composed of Lieryu Formation, Gaojiayu Formation, Dashiqiao
Formation, Gaixian Formation and Quaternary, from the oldest to  the newest. These rocks consist
of various types of marble, schist and leptynite. The metamorph ic rocks have a high background of
gold abundance. The gold grade in marble is about 5.36~21.0 par t per billion (“ppb”), and in schist
and leptynite the grade is 3.88~11.0 ppb. These are the initial gold sources, and they contribute the
basis for the formation of the gold deposit.
The Lieryu Formation rocks are located mainly around Sanguliu, southeast of the region. They dip
to northeast with a dip angle of 35° - 65°. They are composed o f biotite leptynite, biotite amphibole
leptynite, and tourmaline leptynite.
The Gaojiayu Formation rocks are in the western part of the reg ion around Yemofang and in the
southeast part around Sanguliu. They dip to northeast with a dip angle of 35° - 65°. They are
composed of graphite leptynite, graphite biotite leptynite, biotite schist, and biotite gneiss with marble.
The Dashiqiao Formation rocks are in the southwestern part of t he region around Songjiapu. They
dip to northeast with a dip angle of 35° - 65°. The are composed of magnesite marble, calcite marble
and dolomitic marble.
The Gaixian Formation rocks are in the southwestern part of the region around Songjiapu. They dip
to northeast with a dip angle of 35° - 65°. They are composed of slate, biotite schist and biotite gneiss.
The Quaternary is the eluvium and diluvian sediments. They are composed of silty clay and sandy
gravel. The thickness is about 0.3-2.7m.
Figure 5-5: Property Geology Map

Sources: Resource & Reserve Verification Report of the Wulong Mine in Zhen’an District, Dandong City, Liaoning Province, 2019.
– IIIA-93 –
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Geological Setting and Mineralisation   Final
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The structure in this area is mainly fault structure and then fold structure. The Yalu River Fault is the
largest fracture zone in the region, which is located at the edge of the region and extends northeast
and dips to southeast. It is formed by multiple extrusion and s hearing. This fault zone controls the
spreading of copper and gold Mineralisation in the region.
The fault structure in the region is mainly the product of the Mesozoic Yanshan tectonic movement,
which can be divided into northeast trending faults and northwe st trending faults. Extensions of the
faults are more than 10 km and the spacing is 2-4 km and 4-6 km  respectively.  The two groups of
faults form a diamond-shaped lattice structure, controlling the  distribution of the gold-bearing
Mineralised bodies.
The faults can be divided into five groups: the east-west (“ EW”) trending, north-northeast (“NNE”)
trending, northwest (“NW”) trending, northeast (“NE”) trending, and north-south (“SN”) trending faults,
according to their characteristi cs. The faults are characterize d by multi-phase activities and are
mostly filled by various types of vein rocks.
The NW-trending fault is an ore-bearing, tension-torsional faul t, which extends about 10 km along
the direction of 320°. It dips to SW and the dip angle is from 50° to 70°. It is filled by fine diorite veins
and lamprophyre, whose thickness are about 3 to 7 m and up to 25 m sometimes.
The NNE-trending faults are compressive-twisting faults and parallel distributed between each other.
They dip west-northwest (“NWW”) with dip angles of about 56° - 85°. The extension of the fau lts is
ranging from 4 km to 10 km with a width of 2-30 m. The fault zo ne is strongly fragmented, and is
characterized by strong silicification and pyritization alterations, in which there are extrusion lenses
of different scales, and the silicification is very strong, and the lenses are mostly interspersed within
cleavage zone, and quartz veins can be seen, and the fracture i s characterized by multi-phase
development, which is the main ore-bearing structure of the area.
The NE-trending fault is a compressive fault, with an extension  of 45° and dip NW at dip angles
ranging from 30° to 50°. The NS-trending fault is a tension-torsional fault, with an extension of 350°-
0° and nearly vertical. It is filled by granite porphyry veins.  The EW-trending fault (F8) is a
compressive fault, with an extension of 75°-85° and dip SE at d ip angles ranging from 50° to 70°. It
is filled by fine diorite and quartz veins.
The fold structure is namely the Wulong anticline, with an extension of 85°. The axial surface of the
fold is nearly vertical and the dip angle of the shanks is abou t 50°-60°. This fold structure controls
the distribution of the Hegou-Wulong-Hongshi mineralised zones, which is the earliest fold in the
area.
The tectonic activity of the area is mainly of Yanshan period, according to the characteristics of the
fold and fault structures on the stratigraphy and their internal fillings.
The area is characterized by the intrusion of Paleoproterozoic biotite granite and granitelle, early
Yanshanian diorite, granodiorite, granite, and many dykes accompanying the intrusion. In the west
of the Wulong gold mine, it is the Paleoproterozoic Hongshi bio tite granite. In the south, it is the
Yanshanian (126 Ma) Sanguliu granodiorite. And in the north, it  is the Yanshanian (112 Ma)
Dingqishan biotite granite. They are closely related to gold Mineralisation.
Intermediate-acid and mafic dykes develop in the area, which are detailed described as follows.
– IIIA-94 –
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Geological Setting and Mineralisation   Final
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The diorite porphyrite and the fine diorite are almost the same and can’t be identified clearly, with a
slight difference of crystalliza tion. They are grey and pink, a nd are composed of fine plagioclase,
amphibole, and little quartz. Then are nearly north-south trend ing, and dip to east or west with dip
angles mostly 80°. They extend dozens to hundreds of meters, ma inly around the tectonic zone,
accompanying the gold-bearing quartz veins.
The lamprophyre is located near the upper and lower plates of the quartz orthoclase porphyry. They
are nearly NS-trending, dip to east with the dip angles of 55°- 70°. They can be divided into two
groups, the odinite and the garganite. They extend dozens of meters with a width ranging from 1 to
10m.
The diorite porphyry and the fine-grained diorite are in the wall rock near the Mineralised body. They
are characteristic of silicified,  chlorite, sericite, carbonati te, and potassium. The quartz orthoclase
can also be seen in some parts of the alteration phenomenon. It can be considered that these three
vein rocks are of the Mineralisation period, mainly formed befo re Mineralisation. The lamprophyre,
according to its cutting relationship of vein rock and no alteration, should be of post-mining period.
5.2.4 Hanfeng Project
Lishan Mine
Tianbaoshan Lishan-Xinxing mines are located at the intersectio n of Jihei fold system, Yanbian
Eugeosynclinal fold belt and Dunhua uplift of Jilin Eugeosynclinal fold belt. The strata in this area are
mainly the Paleozoic Ordovician - Permian marine carbonate and volcanic sedimentary rock series,
and the Mesozoic Jurassic contin ental pyroclastic rocks. Intens e magmatic activity occurred and
Hercynian and the Yanshan granites developed.
Fold structure and fault structure are developed in the area an d were intersect with each other to
form complex structural system, which provides migration channe l and ore storage space for
Mineralisation. In short, the metallogenic geological condition s are superior, and it is an important
polymetallic Mineralisation concentration area in Jilin Provinc e. The geology map of Tianbaoshan-
Lishan mine is shown in Figure 5-6.
– IIIA-95 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Geological Setting and Mineralisation   Final
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Figure 5-6: Geology Map of Lishan Mine

Source: SRK
6.2.4.2 Dongfeng Mine
Tianbaoshan Dongfeng Mine is located at the intersection of the  west margin of Yanbian
Eugeosynclinal fold belt and Dunhua uplift of Jilin Eugeosynclinal fold belt. The strata in this area are
mainly the Paleozoic Ordovician - Permian Marine carbonate and volcanic sedimentary rock series,
and the Mesozoic Jurassic contin ental pyroclastic rocks. There are strong magmatic activities,
showing the Hercynian and Yanshan granites. Fold structure and fault structure are developed in the
area, and they intersect each other to form complex structural system, which provides favourable
migration channel and ore storage space for Mineralisation. The geology map of Dongfeng mine is
shown in Figure 5-7.
The strata in the area are mainly the Late Paleozoic Permian Mi aoling Formation, and locally the
Early Paleozoic Ordovician Qinglongcun Group and the Mesozoic Jurassic Tuntianying Formation.
Magmatic activity is intense and widely distributed in the area, accounting for about 70% of the whole
area. They are mainly the Hercynian, Indosinian and Yanshanian, among which the Indosinian and
Yanshanian magmatic activities are particularly strong and closely related to Mineralisation.
The structure in this area is mai nly fault structure, which can  be divided into three groups of NW-
trending, NNW trending and NE trending according to the characteristics of faults. In the molybdenum
mine area, there is also a group of near east-west trending str ucture and east-west contact zone
structure.
– IIIA-96 –
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Geological Setting and Mineralisation   Final
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Figure 5-7: Geology Map of Dongfeng Mine

Source: SRK
5.2.5 Jintai Project
The strata outcropped in the project area are the Paleoproteroz oic Huanglongyan Formation and
Shimenguan Formation, the Cretaceous Jingxing Formation, the Paleogene Yunlong Formation, the
Neogene Sanying Formation and the Quaternary sediments (Figure 5-8).
Figure 5-8: Local Geology Setting

Sources: Geological (Advanced Exploration) Report of the Xidengping Gold Deposit, Eryuan County, Yunnan Province, 2022
– IIIA-97 –
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Geological Setting and Mineralisation   Final
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The Paleoproterozoic Huanglongtan Formation can be subdivided i nto two Members: the first
Member of Huanglongtan Formation is composed of gneiss and is distributed in the eastern part of
the region. The second Member of Huanglongtan Formation is composed of light-yellow amphibolite
gneiss, light gay biotite plagioc lastic granulite, and biotite plagioclastic gneiss and is distributed in
the northeast part of the region.
The strata of the Paleoproterozoic Shimenguan Formation are dis tributed in the middle east of the
mining area and lithologically, they are composed of light-grey dolomitic marble with phlogopite, light
grey sandy microcrystalline marble, and dolomitic marble.
The strata of the Cretaceous Jingxing Formation are mainly distributed in the west of the region on
both banks of the Heihui River.  It is parallel unconformity contact or fault contact with the overlying
and underlying strata.
The strata of the Paleogene Yunlong Formation are composed of m udstone and siltstone; they are
mainly located near the Qiaohou-Yangbi Fault on the eastern part of the region.
The Neogene Sanying Formation is subdivided into three members:  Member 3, Member 2 and
Member 1. The. strata of the Member 3 are distributed in the mi ddle of the mining area, which are
covered by the Quaternary alluvial-diluvium and slop-deposit.
Member 2 is subdivided into three beds, Bed 3, Bed 2 and Bed 1. The strata of Bed 3 are distributed
on the east and west sides of Member 3 and are composed of cataclastic sandstone with silty, coarse
sandstone, silty breccia with thin layers of silty mudstone. Th e Bed 3 is the most important gold-
bearing strata in the mining area.
The strata of Bed 2 are distributed on the east and west sides of Bed 3 and are mainly composed of
cataclastic argillaceous siltstone with black mudstone, locally  composed of fine sandstone, coarse
sandstone, and conglomerate interlayer.
The strata of Bed 1 are distributed on the east and west sides of Bed 2 and are composed of gray-
white carbonaceous silty mudstone, carbonaceous mudstone, and argillaceous siltstone, with coal
line or thin coal seam in some parts.
Member 1 is distributed in the western and eastern part of the mining area. Affected by faults and
Quaternary, the width of outcrop varies greatly.  The strata ex posed in the west of the mining area
tend to the northeast, and the strata exposed in the east of the mining area tend to the southwest.
The Quaternary residual slope sediments in the mining area are distributed in the gentle slopes of
the regional slopes, ranging from 3 to 20m thick. The lithology is mainly sand and clay, and there are
also trans blocks of fine sand stone, siltstone, mudstone, mediu m-grained sandstone, coarse
sandstone, conglomerate, siliceous rock, and siliceous conglomerate.
The general structure in the area is a syncline fold. The fault s in the mine area are divided into two
sets: the NW-trending fault and the NE-trending fault.
The magmatic rocks in the mining area are mainly in the form of  dykes, including diabase dykes,
diorite dykes and syenite porphyry dykes.
– IIIA-98 –
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Quartz-mica-diorite dykes cover an area of about 0.03 km 2 in Shiqiaogou – Niugui at the northeast
corner of the mine. The analytical results of sample analysis show that gold grade is 0.01 g/t, which
is not closely related to gold mineralisation.
Diabase dykes are distributed in Gaoluoxi area in the eastern part of the mining area. The sandstone
surrounding the diabase dykes has obvious keratosis, silicification and pyritization. The highest grade
of samples was 0.92g/t Au, generally between 0.2g/t and 0.30g/t Au.  The diabase dykes are closely
related to gold mineralisation.  It provides both heat and mineral sources.
Orthophyre dykes are outcropped in the eastern part of the mine  area. The wallrock of the dykes is
conglomerate, and pyritization and carbonation are seen in the conglomerate; it shows pyrite and
calcite veins filling the conglome rate or sandstone in a networ k of veins. The sample of the rocks
was taken and analysed with a gold grade of 0.051g/t, which is low in gold grade and is not clear that
the dykes have a closely relationship to gold mineralisation.
5.3 Characteristics of Mineralised Bodies
5.3.1 Jilong Project
A total of 18 mineralised bodies in the Zhuanshanzi Block are d iscovered: namely #4, #5, #6, #6-1,
#27-1, #27-2, #27-3, #27-4, #28 and #72 in the No. 1 Mining Zon e, #100, #100-1 and #104 in the
No. 2 Mining Zone, and #26, #26-1, #26-2, #26-3 and #26-4 in the No. 3 Mining Zone.
Mineralised body #4 strikes nort hwest and dips to southwest wit h a dip angle of 78º. Mineralised
body #5 strikes northwest and dips to southwest with a dip angl e of 80º. This Mineralised body is
about 900 m long and 345 m downdip.
Mineralised body #6 strikes northwest and dips to southwest wit h a dip angle of 80º. It is
approximately 467m long and 369m downdip. Mineralised body #6-1  strikes northwest and dips to
southwest with a dip angle of 80º. It is about 207 m long and 416 m downdip.
Mineralised body #27-1 strikes northwest and dips to southwest with a dip angle of 79º. It is 792 m
long and 416 m downdip. Mineralisation body #27-2 strikes north west and dips to southwest with a
dip angle of 79º. It is 388 m long and 496 m downdip.
Mineralised body #72 strikes north west and dips to northeast wi th a dip angle of 72 °. It is 530 m
long and 297 m downdip.
Totally 9 mineralised bodies are discovered in the Zhuanshanzi #4#-5#-6#-7 Block, 4 of them are
the main Mineralised bodies: namely Nos. #300、#310、#320 and #330. These mineralised bodies
are about 80m to 282m long and 84m to 344m downdip. They strike northwest and dips to southwest
with a dip angle of 61°-80°.
Ore minerals include native gold and silver, pyrite, sphalerite , galena, chalcopyrite, magnetite,
hematite, and chalcocite. Gangue minerals include quartz, sericite, chlorite, calcite, epidote, feldspar,
and hornblende.
Textures include crystalline texture, cataclastic texture, metasomatic residual texture, and solid melt
decomposition texture. Structur es include disseminated structur e, vein-like structure, brecciated
structure, and banded structure.
– IIIA-99 –
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5.3.2 Huatai Project
Honghuagou #1 Mining Zone
Honghuagou #1 Mining Zone is divided into four sub-areas: Sub-area #1, Sub-area #3, Vein #3, and
Longtoushan sub-area. The Sub-area #1 includes three mineralised veins, namely Vein #2, Vein #82
and Vein #14, which are controlled by either northwest, nearly north south or northeast trending
faults.
Vein #2 is situated at the northwest and host by the contact of  mixed granite and hornblende
plagioclase gneiss. The Mineralised body is vein-like, strikes northwest and dips northeast with a dip
angle of 59-85°. Vein #14 is situated at the east and host by h ornblende plagioclase gneiss. The
Mineralised body of Vein #14 strikes northeast and dips to southeast with a dip angle of 59-71°. Vein
82# is situated at the southwest and host by hornblende plagioclase gneiss.
Sub-area #3 is situated at the southeast, with slope landform, which is divide into Mineralised body
#15 and #15-3.
Vein #3 is at the south of #1 Mining Zone, includes Mineralised  bodies #3 and #3-1, which strike
northwest, with the dip angle of 62-80°. The mineralised body is host by gneiss of Archean medium-
deep metamorphic rock series. The shape of mineralised body is irregular.
Longshantou sub-area contains three mineralised bodies, includi ng #23-2, #23-4 and #23-5. The
Mineralised body is host by plagioclase hornblende gneiss, migm atite, plagioclase hornblende,
partially hosted by K-feldspar granite. The three mineralised bodies echelon at the cross-section.
The ore minerals include native gold, pyrite, chalcopyrite, magnetite, and minor of sphalerite, galena,
chalcocite, bornite, and limonite. Gangue minerals include quar tz, sericite, chlorite, potassium
feldspar, plagioclase, hornblende, calcite, and kaolin.
Textures include fragmented stru cture, metasomatic filling, fin e idiomorphic crystal structure and
metasomatic residue. Structures include massive structure, stri p structure, disseminated structure,
and breccia structure.
Honghuagou #86 Vein
Five mineralised bodies are defined, they are #86, #86-1, #86-2,# 86-3, and #86-4. The #86, #86-3,
#86-4 are main mineralised bodies.
Mineralised body #86 is situated at the center of the mining area and occurs as gold-bearing quartz
vein. It strikes northwest and dips to northeast with a dip angle of 75º.
The structures include fragmented spot structure, fine grain replacement filling structure, self-shaped
grain structure. The textures inc lude dense block structure, st rip structure, disseminated structure,
breccia structure.
Ore minerals include pyrite, and native gold and silver.  Gangue minerals include quartz, sericite and
chlorite.
– IIIA-100 –
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Geological Setting and Mineralisation   Final
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Pengjiagou Mine
A total of seven mineralised bodies are delineated at the Pengj iagou mining area: they include #1,
#1-1, #2, #19-1, #19-2, #65-2 and #65-3.
Ore minerals include native gold, pyrite, chalcopyrite, galena,  sphalerite, tetrahedrite, arsenopyrite,
goethite, hematite, magnetite, and bornite. Gangue minerals include quartz, sericite, chlorite, calcite,
feldspar and hornblende.
Textures include crushed texture, crystalline texture, dissolut ion texture, enveloping metasomatic
texture, including texture.  Structures include massive structu re, disseminated structure, vein, fine
vein and network vein structure.
Lianhuashan #5 Mining Zone
At Lianhuashan #5 Mining Zone area, six main mineralised bodies are defined, including #1, #51-1,#
51-6, #51-8, #51-9, and #51-10. The structurally controlled min eralised bodies, shown as gold-
bearing quartz veins, strike nearly north-south and/or northwes t. Wall rock alteration includes
silicification, sericitization and chloritization.
Mineralised body 51-1# is situated at the central south, strikes most north-south, dips to west with a
dip angle of 79-81°.
Mineralised body 51-10# is situated at the central south, strikes most north-south, dips to west with
a dip angle of 78-81°.
Mineralised body 1# is situated at the northwest, strikes northwest, dips to northeast with a dip angle
of 65°.
Ore minerals include native gold, pyrite, chalcopyrite, magneti te, and minor of sphalerite, galena,
chalcocite, bornite, and limonite. Gangue minerals include quar tz, sericite, chlorite, potassium
feldspar, plagioclase, hornblende, calcite, and kaolin.
Textures include fragmented stru cture, metasomatic filling, fin e idiomorphic crystal structure and
metasomatic residue. Structures include massive structure, stri p structure, disseminated structure,
and breccia structure.
Lianhuashan #26 Vein
Two mineralized bodies are discovered: #1 and #2. The mineralized body #1 is situated at the central,
strikes nearly north south and dips to southwest with a dip ang le of 65º-68º. The mineralized body
#2 also strikes nearly north south and dips to southwest with a dip angle of 65º-70º.
Textures include heteromorphic granular texture, and metasomati c dissolution texture, semi-
idiomorphic granular texture, mosaic, crushing, and package metasomatic texture. Structures include
dense massive structure, reticulated vein, banded, brecciated, and disseminated.
Ore minerals include native gold, native silver, pyrite, chalcopyrite, galena, magnetite, and hematite.
Gangue minerals include quartz, sericite, calcite, and chlorite.
– IIIA-101 –
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Geological Setting and Mineralisation   Final
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Lianhuashan #3&#7 Vein
A total of 7 mineralised bodies a re discovered: #3, #3-1, #3-2,  #7, #7-1, #8 and #8-1. The #3, #8,
and #8-2 are the main mineralised bodies.
Mineralised body #3-2 is situated at the northeast, strikes northwest and dips to northeast, with a dip
angle of 55º-63º. Mineralised bod y #8-2 is situated at the nort hwest, strikes northwest and dips to
northeast with a dip angle of 43º-75º. mineralised body #8 is s ituated at the northwest, strikes
northwest and dips to northeast with a dip angle of 58º-87º.
Ore minerals include native gol d, pyrite, magnetite, chalcopyri te, galena, sphalerite, argentite, and
chalcocite. Gangue minerals include quartz, sericite chlorite, potassium feldspar, plagioclase,
hornblende, calcite, and kaolin.
Textures include heteromorphic granular texture, semi-idiomorphic granular texture, mosaic texture,
crushing texture. Structures include massive structure, disseminated structure, followed by strip and
network vein.
5.3.3 Wulong Project
Wulong Mine
The Wulong Mine is a large quartz vein type gold deposit. The w all rock is biotite granitite and
monzogranite and the mineralised bodies are strictly controlled by two groups of faults, the northwest
trending faults and north-northeast trending faults, consisting  of rhombic lattice structure. The
mineralised body is in the north -south, northwest trending comp ressive-twisted faults, and fine-
grained diorite associated. The ore type is mainly quartz vein type, and the useful components are
native gold and silver-gold.
A total of 449 gold-bearing bodies were found in the field, inc luding 382 gold-bearing quartz veins
and 67 silicified alteration zones. Due to years of mining, onl y 18 main mineralised bodies can be
mined at present, which can be spatially divided into three ore-forming belts, namely A, B and C.
The mineralised bodies in A and B belts are nearly extending north–south, which are controlled by
granite porphyry veins, fine-grained sphalerite distribution in both sides of the granite porphyry. The
gold mineralised bodies are in the fine-grained diorite. The la teral trending direction is southeast,
with dip angles of about 40°-60°. The shallow part of the miner alised body is far from the granite
porphyry, the deep part is closer to the granite porphyry, even  directly in the granite porphyry. The
main mineralised body in A belt is the Vein #32, and the main m ineralised bodies are the Vein #2
(Vein #2-3, Vein #2-6), Vein #4 (Vein #4-1, Vein #4-2, Vein #4-5) in B belt.
The mineralised bodies in C belt trend northwest, and the main mineralised body is Vein #163. The
Vein #163 is divided into two parts, the north, and the south. The north zone has a high mineralisation
elevation, while the south zone has a low mineralisation elevation.
The gold-bearing quartz veins are enriched in the deep part in a stepwise manner, with the thickness
of the fine-grained diorite veins in an inverse elongation rela tionship, with a right-sided diagonal
pattern in the plane. The gold mineralisation is scattered in t he upper part of the profile, which is
characterized by more veins and smaller scale, while the gold m ineralisation is concentrated in the
lower part, which is characterized by fewer veins and larger scale (Figure 5-9).
– IIIA-102 –
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Geological Setting and Mineralisation   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 41
Figure 5-9: Geological Map of Level 20 of Vein #163

Sources: Resource and Reserve Verification Report of Wulong Mine in Zhen’an District, Dandong City, Liaoning Province, 2019.
Ligunzi Gold Deposit
The Ligunzi gold mineralised body is vein-like, which is contro lled by two group faults, the north-
south trending fault, and the northwest trending fault. General ly, the dip length is longer than the
strike length. The single vein is stable and has the characteri stic of balk reappear, compound of
branch (Figure 5-10). They are right-sided oblique in the plane and slightly forefront in the section.
The scale of the mineralised body is highly variable, with general extension depth of 200-300m. The
max extension along strike length is up to 600m and the dip len gth is over 800m. The thickness of
the veins varies, generally 0.2-3.0m, with maximum thickness of 10m. The north-south trending veins
are nearly upright. The northwest trending veins are generally smaller in size, and dip to SW, with a
dip angle of 60° to 80°, and the mineralised body is obviously expanded.
The mineralised bodies in Ligunzi are Vein #4-6, Vein #10-3, Vein #82, Vein #83, Vein #84 and Vein
#85.
– IIIA-103 –
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Geological Setting and Mineralisation   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 42
Figure 5-10: The Geological Map of Mining Level #16

Sources: The General Exploration Report of the Ligunzi Deposit in Dandong City, Liaoning Province, 2011.
Haojingou-Ligunzi Gold Deposit
A total of 20 gold mineralised bodies and 1 gold low-grade mine ralised body are outlined in
Haojingou-Ligunzi area. The strike of Mineralised body is northwest, northeast, or nearly north south
and dips to southwest, northwest, southeast, or west with dip angles from 45° to 80°. They are in the
central or edge part of the diorite dyke, granite porphyry, sometimes in mixed granite. Generally, the
mineralised bodies are 37-317m long, 20-225m downdip, with a width of 0.3-2.5m. The grade varies
from 1.22 to 40.06g/t. Most of the mineralised bodies are thin.
The work area is in the east and south of the Wulong gold mine area, according to the distribution of
veins, the detailed exploration area is divided into three parts, respectively, the Haojingou area, the
Dahudengzi area, and the Ligunzi area. The Haojingou area is in the north-east of the region, with 8
gold mineralised bodies and 1 low-grade mineralised body (Figure 5-11). The Dahudengzi area is in
the central and south-eastern part, with 5 gold mineralised bod ies. The Ligunzi area is in the
southwest, and with 7 gold mineralised bodies.
– IIIA-104 –
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Figure 5-11: The Line 805 Section Map in Haojingou Area

Sources: The detailed Exploration Report of the Haojingou-Ligunzi Gold Mine in Dandong City, Liaoning Province, 2017.
5.3.4 Hanfeng Project
Lishan Mine
Lishan mining area contains three polymetallic deposits, namely  Lishan, Xinxing and Lishan Plant-
Houshan. Xinxing deposit and Lishan Plant-Houshan deposit has n ot been exploited due to the
difficulty in separating lead and zinc in concentrate. According to previous exploration reports, there
are 961 mineralised bodies in Lishan deposit (above -92m asl), one mineralised body in Xinxing
deposit, and 12 mineralised bodies in Lishan Plant-Houshan deposit.
Lishan deposit (above -92m asl) consists of three Mineralisation zones, with a total of 961 orebodies,
which are divided into Xinglong mineralisation zone, Lishan min eralisation zone and Taisheng
mineralisation zone from north to south. Among them, there is one surface exposed mineralised body
and 4 underground mineralised bodies in Xinglong mineralisation  zone. One surface mineralised
body and 636 underground mineralised bodies were interpolated i n Lishan mineralisation belt. One
surface mineralised body and 318 underground mineralised bodies  have been interpolated in
Taisheng mineralisation belt.
– IIIA-105 –
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Geological Setting and Mineralisation   Final
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The Lishan mineralised zone is 700m long, 500m wide and nearly 800m downdip. The Xinglong
mineralised zone is about 420 m long and 10-40 m wide, extendin g from the surface to level 15m.
Generally, the strike of mineralised bodies is northwest with a dip angle of about 65°. The mineralised
bodies orientation of Taisheng mineralisation zone is relatively complex, the mineralised body strikes
generally northwest, most of the mineralised bodies dip to sout hwest, and some dip to northeast or
south, with a dip Angle of 65°. The morphology of Lishan deposi t is complex, and the shallow
mineralised bodies are mainly lentil, wedge-shaped and vein sha ped. In the central part of the
deposit, the mineralised bodies are mainly lenticular and vein- shaped, and there are also small,
mineralised bodies in the shape of nests, lentils and wedges. T he mineralised bodies in the deep
part of the deposit are stratiform or wedge-like, nest-like, wi th branch compound, pinch-out
recurrence, shrinkage and enlargement.
The ore minerals are mainly sphalerite and galena, followed by chalcopyrite, pyrite, pyrrhotite,
magnetite, chalcocite, bornite and arsenopyrite. Gangue mineral s are diopside, garnet, epidote,
quartz, calcite, sericite, actinolite and chlorite.
Lishan Pb-Zn Deposit (Below the -92m asl) is a zinc polymetallic deposit dominated by zinc ore, with
some copper and lead. The mineralised bodies are vein, lenticular and lentil shaped. There are 128
zinc-lead-copper mineralised bodies were defined.
Zinc ore is metal sulfide sphalerite, and other metal minerals with relatively less content are zincite,
franklinite, pyrite, siderite, galena, boulangerite, cerussite, chalcopyrite, etc. The main metal minerals
of copper-zinc ore are sphalerite, chalcopyrite, magnetite, pyrite, and pyrrhotite.
According to the ore structure,  the composition, content and sy mbiotic association of metallic
minerals and non-metallic minerals, the natural type of ore is sphalerite-bearing galena skarn type.
Dongfeng Mine
Dongfeng lead-zinc ore is mainly located in the skarn mineralisation zone formed at fault zone, mostly
located between 280m ~ 600m asl. The mineralised belt generally extended in the direction of NW -
- NW, with a length of about 1,800m, a width of about 150m. It dips to the south-west with a dip Angle
of 40°-75°. A total of 123 mineralised bodies have been identified in Dongfeng lead-zinc deposit, all
of which belong to polymetallic mineralisation type. The mineralised bodies are stratiform, dendritic,
vein-like, lenticular-like and lentil-like, with a general length of 5-90m and a maximum of 380m. The
thickness is generally 3-10m, the maximum is 35m, and the maxim um depth is 450m. The
surrounding rock near the mine is mineralised skarn or minerali sed skarn rock, and the boundary
between the mineralised body and the surrounding rock is unclea r and shows a gradual transition
relationship.
Dongfeng molybdenum deposit (above 250m asl) mainly occurs in the porphyritic monzogranite,
contact zone of granodiorite and volcanic rock and schistosity zone of quartz diorite porphyry, which
are mostly composed of quartz veins and altered breccia. The schistosity zone is generally NW - NW
extend, with the length about 1,200m, the bandwidth of each slice about 50m - 100m, the strike 310¬
350° ~350°, the general trend is southwest, dip to west-south w ith the dip Angle of 30°-70°. The
orebodies are mostly vein-like and locally lentil-like, and the mineralisation is enhanced from surface
to depth. Ore minerals are mainly molybdenite, followed by a sm all amount of chalcopyrite,
sphalerite, galena, arsenopyrite, and pyrite. Gangue minerals are quartz, diopside, chlorite, epidote,
zeolite, calcite, feldspar and biotite.
– IIIA-106 –
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Geological Setting and Mineralisation   Final
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At present, the upper part of Dongfeng Mine is mainly engaged in the exploitation of remnant mining
and primary mineralised body, and the ore is primary ore without oxidation.
The molybdenum mineralised bodies (below 250m asl) of the Dongfeng Mine are located within the
contact zones of Early Jurassic diorite granite, Late Triassic quartz diorite, and fine-grained diorite,
as well as along the surrounding fracture zones of the rock masses. These orebodies are controlled
by the underlying concealed rock bodies and northwest-trending fault structures, resulting in two sets
of northwest-trending molybdenum-bearing quartz vein zones with  steep and gentle dips. The
orebodies appear vein-like or kidney-shaped, arranged parallel to each other, sometimes exhibiting
local contraction and dilation phenomena. The boundaries of the orebodies are defined by samples
collected near the rock walls. Through deep-level tunnels and d rilling engineering control, a total of
178 molybdenum orebodies of varying sizes have been discovered.
5.3.5 Jintai Project
Two mineralised domains in the mining licence and eight mineral ised domains in the exploration
permit are found. The main domains are V1 in the mining licence area and V4, V10 in the exploration
permit area.
Mineralised Domain V1 is distributed in the northwest of mining licence, between line 0 and line 16.
It strikes to the northwest of about 325~340°, dips to the sout hwest of about 235~250° with a dip
angle of 6~15°, has a known strike length of 307m and down-dip extension of 539m. The thickness
of the domain ranges from 2.00 to 25.43m, with an average of 8. 90m.  The gold grade is 0.31 ~
1.84g/t, with an average of 0.90g/t. It is pinched out between lines 7 and 9 in the northwest, and
between lines 8 and 16 in the southeast.  It appears to be laye red surface or near-surface. The
domain is controlled by 15 trenches and 30 drillholes. The ore-bearing rocks is ferritization siltstone
and silicified siltstone, and the hanging wall is mainly sandstone and siltstone. The foot wall is mainly
carbonaceous silty mudstone, and mudstone and argillaceous silt stone, with coal line or thin coal
seam (See Figure 5-12).
Figure 5-12: Section Map of Line 4 for Mineralised Domain V1

Sources: Geological (Resource Verification) Report of the Xidengping Gold Deposit, Eryuan County, Yunnan Province, 2021

Mineralised Domain V4 is distributed in the Tangzibian zone, southern part of the exploration permit
area, between line 88 and line 122. It is the main and largest domain of the project. It is controlled
by 76 drillholes and 10 trenches . It strikes to the northwest o f about 330°, dips to the southwest of
240° with a dip angle of 2~40°, has a known strike length of about 550m and the down-dip extensions
range from 40m to 560m. The thickness of the domain V4 ranges f rom 0.79 m to 86.76 m, with an
average of 22.87m. The thickness is large in the east side and becomes thinner in the west side (see
Figure 5-13 and Figure 5-14). The thickness variation coefficient is 111.58%, indicating that the
– IIIA-107 –
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Geological Setting and Mineralisation   Final
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thickness variation of the domain is relatively stable. Most of the gold grade range from 0.2g/t to 10
g/t (the maximum is up to 113g /t), with an average of 1.69g/t. By combination analysis, the silver
grade of the V4 domain ranges from 0.50g/t to 11.80g/t, and the average is 4.58g/t.
The mineralised domain V4 occurs in siliceous breccia, cataclastic siliceous rock, cataclastic siltstone
and siltstone in the interlayer fracture zones of Sanying Formation. The occurrence of the domain is
basically consistent with the stratigraphy.
Figure 5-13: Section Map of Line 98 for Mineralised Domain V4

Sources: Geological (Advanced Exploration) Report of the Xidengping Gold Deposit, Eryuan County, Yunnan Province, 2022
Figure 5-14: Section Map of Line 106 for Mineralised Domain V4

Sources: Geological (Advanced Exploration) Report of the Xidengping Gold Deposit, Eryuan County, Yunnan Province, 2022
Mineralised Domain V10 is distributed in the Xidengping zone, northern part of the exploration permit
area, between line 87 and line 99. It is controlled by 31 drillholes. It strikes to the northwest of about
330°, dips to the southwest of about 245° with a dip angle of 2 ~12°, has a known strike length of
268m and the down-dip extensions range from 120~410m (Figure 5-15). The gold grade in V10 gold
– IIIA-108 –
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domain ranges from 0.11g/t to 25g/t, with an average grade of 2.69g/t. By combination analysis, the
silver grade of the V10 domain ranges from 0.35 g/t to 2.87g/t, and the average is 1.15g/t.
The mineralised domain V10 occurs in cataclastic siliceous siltstone in the interlayer fracture zones
of Sanying Formation. The occurrence of the domain is basically consistent with the stratigraphy.
Figure 5-15: Section Map of Line 95 for Mineralised Domain V10

Sources: Geological (Advanced Exploration) Report of the Xidengping Gold Deposit, Eryuan County, Yunnan Province, 2022

– IIIA-109 –
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Exploration, Sampling, Analytical Procedures and Quality Assurance and Quality Control  Final
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6 Exploration, Sampling, Analytical Procedures and
Quality Assurance and Quality Control
6.1 Exploration
6.1.1 Jilong Project
Jilong Mining was established in October 2005, formerly known a s the state-owned Chifeng
Zhuanshanzi Mine.
From 1982 to 1984, No. 108 Geological Brigade of Inner Mongolia Nonferrous Geological Exploration
Bureau (“Brigade 108”) carried out general prospecting work, compiled the “Prospecting Evaluation
Report for the Zhuanshanzi Gold Mine in Aohanqi, Chifeng City, Inner Mongolia”.
From April to October 1993, Shenyang Gold Institute revised and surveyed the 1:10000 scale
topographic and geological map and compiled the “1:10000 Scale Geological Mapping Report of
Zhuanshanzi Mine in Aohanqi, Inner Mongolia”.
From 1992 to 1993, Changchun Metallurgical Geology College conducted basic geological research
in this area and compiled the “Research on the Metallogenic Str ucture and Metallogenic Prediction
of the Zhuanshanzi deposit in Aohanqi, Inner Mongolia”.
In 2005, Inner Mongolia Wuhua Tianbao Mineral Resources Co., Ltd. (“Tianbao”) was commissioned
by Aohanqi Zhuanshanzi Mine to verify the gold resource and reserves within the mining license and
compiled the “Resource and Reserve Verification Report on the Zhuanshanzi Mine in Aohanqi, Inner
Mongolia” in December 2005.
In 2010, Inner Mongolia Tianxin Geological Exploration and Deve lopment Co., Ltd. (“Tianxin”) was
commissioned by Jilong Mining to verify and compile the “Resource and Reserve Verification Report
of the Zhuanshanzi Mine in Aaohanqi, Inner Mongolia”.
In May 2011 Tianxin compiled three reports including “Resource and Reserve Verification Report of
#1 Mining Area (Below 150m asl) in the Zhuanshanzi Mine, Aohanq i, Inner Mongolia”, “Resource
and Reserve Verification Report of #2 Mining Area (Below 520m a sl) in the Zhuanshanzi Mine,
Aohanqi, Inner Mongolia” and “Resource and Reserve Verification Report of #3 Mining Area (Below
520m asl) in the Zhuanshanzi Mine, Aohanqi, Inner Mongolia”.
In February 2012, Jilong Mining entrusted Tianxin to verify and compile the Resource and Reserve
Verification Report of the Zhuanshanzi Mine in Aaohanqi, Inner Mongolia”.
On March 3, 2012, after re-integration and delimitation of the mining area of the Zhuanshanzi Mine,
Jilong Mining obtained a new mining license with a certificate number C1500002009114120054250.
The mining right covers an area of 6.2614km2.
Table 6-1 lists a summary of exploration workloads completed in  both #1#2#3&depth mineralised
block from 2003 to 2018 and #4#5#6#7 mineralised block between 2013 and 2018 at the
Zhuanshanzi Mine.
– IIIA-110 –
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A 1:2,000 scale geological mapping was conducted to reveal the geology boundary. The profile of
channelling sample is 10cm wide by 5cm deep by 0.8-2m long. A topographic survey was conducted
and Xi’an 1980 coordinator system (3º for one zone and zone meridian is 117º) and 1985 Elevation
reference was adopted. RTK surveying was used for 1:2,000 scale geology and topographic mapping.
Table 6-1: Completed Exploration Workload at Zhuanshanzi Mine
No. Exploration work Unit Completed
#1#2#3&Depth Mineralised Block (2003-2018)
1 1:10000 hydro-geology investigation km2 36
2 1:10000 geology investigation km2 36
3 1:2000 geology mapping km2 6.28
4 Core drilling m 19,078.3
5 Tunnel exploration m 5,989.9
6 Analysis and test
 Basic analysis sample 14,930
 SG test sample 227
7 Other geological work
 Tunnel hydrogeology and engineering geology logging m 5,989.9
 Tunnel radioactivity measurement m 2,050
  Channel sampling sample 13,341
#4#5#6#7 Mineralised Block (2013-2018)
1 1:10000 hydro-geology investigation km2 59.75
2 1:10000 geology investigation km2 59.75
3 1:2000 geology mapping km2 9.37
4 Core drilling m/holes 10,925.3/64
5 Tunnel exploration m 302
6 Analysis and test
 Basic analysis sample 580
  SG test sample 60
6.1.2 Huatai Project
From 1957 to 1970, Hebei regional Geological Survey and the No. 2 Geological Birgade of Liaoning
Regional Geological Survey (“Brigade 2”) conduct regional geological mapping at Honghuagou Mine
and Lianhuashan Mine.
In 2006 and 2008, Huatai Mining entrusted Tianxin to conduct a detailed geological exploration and
a complementary exploration, respectively at both Honghuagou and Lianhuashan mines.
Between October 2006 and December 2007, Huatai Mining commissioned Chifeng Boyuan Mineral
Exploration Co. Ltd. (“Boyuan”) to conduct detailed geological exploration at Honghuagou #86 Vein,
Pengjiagou and Lianhuashan #26 Vein and #3&#7 Vein.
From April 2011 to December 2012, Huatai Mining commissioned Ch ifeng Shengyuan Mineral
Exploration Co. Ltd. (“Shengyuan”) to conduct complementary detailed geological exploration and
prepare report at Honghuagou #86 Vein, Pengjiagou and Lianhuashan #26 Vein and #3&#7 Vein.
Table 6-2 lists a summary of exploration workloads completed at  Honghuagou #1Mining Zone and
Lianhuashan #5 Mining Zone between 2003 and 2018, and Honghuagou #86 Vein, Pengjiagou Mine,
Lianhuashan #26 Vein and Lianhuashan #3&#7 Vein between 2008 and 2020, respectively.
– IIIA-111 –
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A topographic survey was conducted, and Xi’an 1980 coordinator system (3º for one zone and zone
meridian is 117º) and 1985 Elevation reference was adopted.
RTK surveying was used for 1:10,000 scale and 1:2,000 scale geological and topographic mapping.
The channelling samples were collected perpendicular to the strike of mineralised bodies along the
underground exploration-level adits. The profile of the channelling sample is 10cm wide by 5cm deep
by 0.8-1.2m long. The weight of each channelling sample is 9.45-12.38kg.
Table 6-2: Completed Explorati on workload at Honghuagou and Lianhuashan Mines
No. Exploration work Unit Completed
Honghuagou #1 Mining Zone (2003-2018)
1 1:10000 hydro-geology investigation km2 103.44
2 1:10000 geology investigation km2 103.44
3 1:2000 geology mapping km2 9.41
4 Core drilling m/holes 34,746.5/110
5 Tunnel exploration m 17,143.2
6 Analysis and test
 Basic analysis sample 3,638
 SG test sample 256
7 Other geological work
 Tunnel hydrogeology and engineering geology logging  m 17,143.2
  Tunnel radioactivity measurement   40.98
Honghuagou #86 Vein (2008-2012)
1 1:10000 hydro-geology investigation km2 7.5
2 1:10000 geology investigation km2 7.5
3 1:2000 geology mapping km2 2.38
4 Core drilling m/holes 5,739.4/22
5 Tunnel exploration m 1,076
6 Analysis and test
 Basic analysis sample 497
 SG test sample 65
Pengjiagou Mine (2008-2012)
1 1:10000 hydro-geology investigation km2 15
2 1:10000 geology investigation km2 15
3 1:2000 geology mapping km2 3.79
4 Core drilling m/holes 7,227.8/44
5 Tunnel exploration m 357
6 Analysis and test
 Basic analysis sample 473
  SG test sample 75
Lianhuashan #5 Mining Zone (2003-2018)
1 1:10000 hydro-geology investigation km2 15
2 1:10000 geology investigation km2 15
3 1:2000 geology mapping km2 0.82
4 Core drilling m/holes 4,565.4/22
5 Tunnel exploration m 9,381.5
6 Analysis and test
 Basic analysis sample 1,330
 SG test sample 96
7 Other geological work
 Tunnel hydrogeology and engineering geology logging  m 9,381.5
– IIIA-112 –
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Exploration, Sampling, Analytical Procedures and Quality Assurance and Quality Control  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 51
No. Exploration work Unit Completed
  Tunnel radioactivity measurement   3,550
Lianhuashan #26 Vein (2008-2012)
1 1:10000 hydro-geology investigation km2 380
2 1:10000 geology investigation km2 380
3 1:2000 geology mapping km2 0.33
4 Core drilling m/holes 2,787.4/13
5 Tunnel exploration m 1,578.6
6 Analysis and test
 Basic analysis sample 266
  SG test sample 30
Lianhuashan #3&#7 Vein (2008-2012)
1 1:10000 hydro-geology investigation km2 8.71
2 1:10000 geology investigation km2 18.715
3 1:2000 geology mapping km2 3.03
4 Core drilling m/holes 5,879.4/50
5 Underground Drilling m/holes 882.2/11
6 Tunnel exploration m 5,113.7
7 Analysis and test
 Basic analysis sample 2,385
  SG test sample 110
6.1.3 Wulong Project
Wulong and Ligunzi Gold Deposits
From 1960 to 1987, the Brigade 103 of Liaoning Non-ferrous Geol ogy Bureau (“Brigade 103”, the
former Brigade 107 of the Liaoning Metallurgical Geology Bureau) undertook exploration work in the
Wulong mine with a total drillhole length of 185,000m and a total trenching of 230,000m3.
From 2001 to 2002, Brigade 103 carried out a national land and resources investigation work in the
adjacent area of the Wulong Mine.
From June 2006 to December 2009, Brigade 103 undertook a drilling and tunnelling campaign in the
Wulong Mine, with a total drillhole length of 7,128.7m and a total tunnel length of 5,006.8m.
From 2010 to 2011, General Exploration Institute of Liaoning Non-ferrous Geology Bureau undertook
the detailed exploration work in Ligunzi area, with a total dri llhole length of 1,097.8m, a total tunnel
length of 308m and a total trenching of 506m3.
In 2016 and 2019, the Brigade 7 of Liaoning Geological Bureau ( “Brigade 7”) conducted resource
and reserve verification work of the Wulong Mine, respectively.
Haojingou-Ligunzi Gold Deposit
In 1982, the Brigade 107 of the Liaoning Metallurgical Geology Bureau (“Brigade 107”) undertook
the general and advanced exploration in the Banshi Sandui and Dahudingzi area.
In 1993, Brigade 103 undertook a general exploration in the adj acent area of Wulong Mine and
Sidaogou Mine.
– IIIA-113 –
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Exploration, Sampling, Analytical Procedures and Quality Assurance and Quality Control  Final
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In 2000, the exploration license was set up and the Brigade 103  undertook the geological,
geophysical, and geochemical survey.
From 2005 to 2011, Brigade 103 undertook the general exploration in the Haojingou-Ligunzi area.
From 2012 to 2017, Brigade 103 undertook the detailed explorati on, with a total surface drillhole
length of 20,026m, a total underground drillhole length of 1,02 1.9m, a total tunnel length of 1,619m
and a total trenching of 28,974.5m3.
Geophysical Survey
The geophysical survey, including a 1:50,000 scale aerial magnetic survey and a 1:200,000 gravity
survey in Dandong region was conducted from 1958 to 1964, and according to the characteristics of
the aerial magnetic anomaly, the Wulong Mine and its adjacent a re divided into four magnetic
anomaly zones, all trending northeast. In the west it is the hi gh anomaly zone and the transitional
anomaly zone (+50 to -50nt), negative anomaly zone (<-50nt) and transitional anomaly zone (+50 to
-50nt) is in the east. Comparing with the 1:50,000 scale geological map, it shows that all known gold
deposits in the area are distributed in the gradient zone of th e transition anomaly zone. That is, the
transition area of the concentrated distribution of the aerial magnetic anomaly zone in the area is the
edge of the major geological bodies or contact zone area in the  area, which coincides well with the
geological conditions of gold deposits.
Geochemical Survey
In 1989, Brigade 103 carried out the geochemical stream sediment survey in the Wulong Mine
covering an area of 900 km 2, and indicated 17 elements including Cu, Pb, Zn, Ni, Cr, Co, M n, Mo,
Ag, Au, Hg, V, Ti, As, Cd, Be and Bi as the indicator elements. A total of 4 comprehensive anomalies
of class I, 6 comprehensive anomalies of class II and 4 compreh ensive anomalies of class III were
obtained. These anomalies have obvious concentration centres an d good elemental combination.
The Wulong gold deposit is located on the I -1 anomaly, and the  discovery of these anomalies
provides a solid basis for further gold exploration in the area.
Remote Sensing Geological Survey
From March 1991 to March 1994, the Geology Institute of Liaonin g Geological Survey undertook a
remote sensing survey. Four sets of lineal images, northeast, north-northeast, northwest, and east-
west trending, are clearly developed. The ring images are mainly round and oval, with closed rings
and semi-rings, and their sizes vary. The combined image is a composite of four sets of linear images
with an incomplete concentric ring image superimposed. The Wulo ng gold deposit is in this
combination image.
6.1.4 Hanfeng Project
Lishan Mine
In 1950, Northeast Geological and Mineral Survey-YanjiHelong Team conducted a mineral survey.
From 1953 to 1954, Northeast Branch 107 of Ministry of Heavy In dustry of China (“ Branch 107”)
took a deep exploration below level #6 in Lishan Deposit of Tianbaoshan Mine.
– IIIA-114 –
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Exploration, Sampling, Analytical Procedures and Quality Assurance and Quality Control  Final
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From 1958 to 1965, Jilin Metallurgical Geological Exploration Company carried out survey a detailed
investigation and exploration work in Erdaogou-Lishankeng area of Tianbaoshan Mine.
In August 2011, Hanfeng Mining obtained the exploration right (below -92m asl) of Lishan lead-zinc
deposit in Tianbaoshan Mine.
The deep exploration of Lishan lead-zinc mine (below -92m asl) lasted nine years and one month
from August 2011 to August 2020.
Table 6-3 lists a summary of key completed exploration between 2011 and 2020 at the Lishan Mine
below -92m asl.
Table 6-3: Completed Exploration Workload at Lishan Mine (below -92m asl)
No. Exploration Work Unit Completed
1 Control survey GPS Point 7
2 1:10000 hydro-geology investigation km2 15
3 1:10000 geology investigation km2 15
4 Core drilling m 46,351.96
5 Tunnelling exploration m 6,384.0
6 Analysis and test
 Basic analysis sample 9,916
 SG test sample 466
 Processing test sample 1
7 Other geological work
 Geologic engineering point survey Point 389
 Drilling hydrogeology and engineering geology logging  m 21,172 .7
 Tunnel hydrogeology and engineering geology logging m 909.6
  Tunnel radioactivity measurement   153
Dongfeng Mine
From 1958 to 1965, Jilin Metallurgical Geological Exploration Company carried out exploration work.
Between 1975 and 1990, the No. 605 Geological Brigade of Jilin Metallurgical Geological Exploration
Company (“Brigade 605”) and Tianbaoshan Mine carried out a lot of geological exploration work in
the mining area and its periphery.
Table 6-4 lists a summary of key completed exploration from December 2013  to February 2023 at
the Dongfeng Mine below 250m asl.
Table 6-4: Completed Exploration Workload at Dongfeng Mine (below 250m asl)
No. Exploration Work Unit Completed
1 Control survey GPS Point 4
2 1:10000 hydro-geology investigation km2 15
3 1:10000 geology investigation km2 15
4 Core drilling m 93,391.36
5 Tunnelling exploration m 4,707.34
6 Analysis and test
 Basic analysis sample 33,909
 SG test sample 300
 Processing test 1
– IIIA-115 –
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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Exploration, Sampling, Analytical Procedures and Quality Assurance and Quality Control  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 54
No. Exploration Work Unit Completed
7 Other geological work
 Geologic engineering point survey point 423
 Drilling hydrogeology and engineering geology logging  m 85,713 .06
 Tunnel hydrogeology and engineering geology logging m 694.3
  Tunnel radioactivity measurement   208
6.1.5 Jintai Project
From 2007 to 2009, the Yunnan Yuxi Maite Industrial Co. Ltd. (“Yuxi Maite”) carried out a geological
exploration with a total drillhole of 200m, a total exploration  pit of 150m and a total excavated
trenching of 4,500m3.
Between 2009 and 2010, Shanghai Fuduo Mining Exploration Techno logy Co., Ltd. (“ Fuduo”)
conducted the topographic survey, the geological survey, and the geochemical survey in the mining
licence area. A total of 27 drillholes with an aggregate length  of 1,410.9m were drilled. A total of 24
trenches with 8,000m3 were carried out. The general geological exploration report was submitted.
From 2012 to 2016, Fuduo conducted the geological and geochemic al survey in the exploration
licence area with a total length of 3,361.9m drillholes and a total volume of 1,581.7m3 trenches.
Between 2017 and 2018, Fuduo conducted the geological exploration in the exploration licence area
with a total length of 997.2m drillholes and a total volume of 891.2m3 trenches.
From October 2020 to October 2021, Yunnan Yuanhao Mining Co., Ltd. (“Yuanhao”) carried out the
resource verification work in the mining licence area with a to tal length of 597.2m drillholes. The
resource verification report for Xidengping Mine was submitted.
From March 2021 to September 2022, Yuanhao conducted the advanc ed exploration campaign in
the exploration licence area with a total length of 7,386.6m boreholes and a total volume of 1,309.9m3
trenches. The advanced geological exploration report for the exploration licence area was submitted.
Table 6-5 lists the main completed ex ploration work in the Xidengping mining license area. The
geological exploration consists of mainly three phases: the general exploration conducted by Fuduo
from 2007 to 2010, the exploration for Mineralised Domain V2 co nducted by Fuduo from 2012 to
2013 and the Mineral Resource verification conducted by Yuanhao from 2020 to 2021.
Table 6-5: Completed Explorati on Workload in the Mining Licence Area
No. Exploration work Unit Completed
1 1:10000 hydrogeology & environm ental geology investigation km 2 10.28
2 1:2000 geological survey km2 1.092
3 Core drilling m 2,917.91
4 Tunnelling exploration m3 8,158
5 Analysis and test
 Basic analysis sample 1,650
 SG (piece) test sample 30
 SG (lump) test  sample 2
 Processing test sample 1
6 Other geological work
 Geologic engineering point survey Point 67
 Geology logging of drilling m 2,917.91
– IIIA-116 –
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Exploration, Sampling, Analytical Procedures and Quality Assurance and Quality Control  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 55
No. Exploration work Unit Completed
  Geology logging of tunnel m3 8,158
Table 6-6 lists the main completed exploration work in the Xidengping exploration permit area. The
geological exploration is mainly composed of two phases: the exploration conducted by Fuduo from
2011 to 2017 and the advanced exploration conducted by Yuanhao from 2020 to 2022.
Table 6-6: Completed Exploration Workload in the Exploration Permit Area
No. Exploration work Unit Completed
1 1:10000 hydrogeology & environm ental geology investigation km 2 35
2 1:2000 hydrogeology &  environmental geology investigation km 2 3.48
3 1:10000 geological survey  km2 10.28
4 1:2000 geological survey km2 3.48
5 1:2000 topographic survey km2 3.48
6 Core drilling m 11,699.47
7 Tunnelling exploration m3 3,781.57
8 Analysis and test
 Basic analysis  9,629
 SG (piece) test  103
 SG (lump) test   4
 Processing test  1
9 Other geological work
 Geologic engineering point survey Point 182
 Geology logging of drilling m 11,699.47
  Geology logging of tunnel m 1,223.38
6.2 Drilling and Trenching
6.2.1 Jilong Project
A total of 81 drillholes with an aggregate length of approximat ely 19,078.3m were conducted at the
Zhuanshanzi #1#2#3&depth Block, and a total of 64 drill holes with an aggregate length of 10,925.3m
were drilled at the exploration of Zhuanshanzi #4#-5#-6#-#7 Block.
The holes were drilled by XY-4 drill rigs, with a starting diam eter of 110mm. After passing through
the Quaternary loose sedimentary layer, the diameter of the drill bit was changed to 75 mm until
termination of the hole. Figure 6-1 shows the drillhole locations at the Zhuanshanzi Mine.
The collars of the holes were properly surveyed, and down-hole surveying was undertaken at 50m
intervals starting at 25m deep after the commencement. The down-hole surveys were conducted
with YT-1 little calibre compass clinometer for the boreholes i n the #1#2#3&depth Block and with
BZM-R-B little calibre compass clinometer for the boreholes in the #4#5#6#7 Block, respectively.
The whole core recovery for all 81 drill cores varied from 86% to 100%, and the average recovery
rate for mineralised core intervals was 100%. The whole core re covery for all 64 drill cores varied
from 92% to 100%, and the recovery rates for mineralised core i ntervals were between 93% and
100%.
As design cementation collar seal was conducted, and the #425 cement was used for collar seal.
– IIIA-117 –
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Exploration, Sampling, Analytical Procedures and Quality Assurance and Quality Control  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 56
Figure 6-1: Distribution of Drillholes in the Zhuanshanzi #1#2# 3&depth Block

A total of 5,989.89m underground tunnels were conducted in the #1#2#3&depth Block, and a total of
45,586.20m underground tunnels were completed in the #4#5#6#7 Block. The profile of tunnel was
2.0m × 2.0m.
6.2.2 Huatai Project
Honghuagou #1 Mining Zone
A total of 75 drillholes with an aggregate of 27,760.05m were c onducted at the 2017 resource
verification program, of which 22 were surface holes, total length of 13,435.16m and 53 underground
holes, total length of 14,324.89m. A total of 35 historical dri llholes with an aggregate length of
6,986.43m are entered into the database. Figure 6-2 shows the distribution of the drillholes.
The surface holes were conducted by XY-4 drill rigs, with a starting diameter of 110mm. After passing
through the Quaternary loose sedimentary layers, the diameter of the drill bit was changed to 75mm.
The underground holes were conducted by modified XY-2 and XY-4 drill rigs, with a starting diameter
of 75mm until terminate.
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Exploration, Sampling, Analytical Procedures and Quality Assurance and Quality Control  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 57
Figure 6-2: Borehole Location Map

Sources: SRK
The collars of the holes were properly surveyed, and down-hole surveying was undertaken at 50m
intervals starting at 25m after commencement.  The down-hole su rvey was conducted with KXP-2
little calibre compass clinometer.
The recovery rates for mineralised intervals of the 75 drill ho les were 100%, and all rock core
recovery rates varied from 99.28% to 100%. As design cementatio n collar seal was conducted and
the #425 cement was used for collar seal.
A total of 17,143.24m underground tunnels were conducted and us ed for resource estimate. The
profile of the tunnels was 2.0m × 2.0m.
Honghuagou #86 Vein
A total of 22 drillholes with an aggregate length of 5,739.44m were conducted at the Honghuagou
#86 Vein. The holes were drilled by XY-4 drill rigs, with a sta rting diameter of 91 mm. After passing
through the Quaternary loose segmentary layers, the diameter of the drill bit was changed to 75 mm
until termination.
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Exploration, Sampling, Analytical Procedures and Quality Assurance and Quality Control  Final
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The collars of the holes were properly surveyed, and down-hole surveying was undertaken at 50m
intervals starting at 25m after commencement. The down-hole sur vey was conducted with CX-6B
little calibre compass clinometer.
The recovery rates for mineralised intervals on 22 drill holes were 100%, and all rock core recovery
rates varied from 75% to 100%. As design cementation collar sea l was conducted and the #425
cement was used for collar seal.
A total of 1,076m long underground tunnels were conducted and u sed for resource estimate. The
profile the adits was 2.0m × 2.0 m.
Pengjiagou Deposit
A total of 44 drill holes with aa aggregate length of 7227.79m were conducted at the Pengjiagou
deposit. The holes were drilled by XY-4 drill rigs, with a star ting diameter of 91 mm. After passing
through the Quaternary loose sedimentary layers, the drill bit with a diameter 75 mm was used until
termination.
The collars of the holes were properly surveyed, and down-hole surveying was undertaken at 50m
intervals starting at 25m after commencement. The down-hole sur vey was conducted with CX-6B
little calibre compass clinometer.
The mineralised core recoveries for the 22 drill holes were between 98% and 100%, and all rock core
recoveries varied from 93% to 100%. As design cementation collar seal was conducted and the 425#
cement was used for collar seal.
A total of 357m underground adits were used for resource estimate. The profile of the adits was 2.0m
× 2.0m.
Lianhuashan #5 Mining Zone
A total of 22 underground drill holes, with an aggregate length  of 4,565.42m were conducted at the
Lianhuashan #5 Mining Zone. Among these boreholes, three holes are horizontal holes, and the
other are inclined holes. The underground holes were conducted by modified XY-5 drill rigs, with a
starting diameter of 75 mm until terminate of the holes.
The collars of the holes were properly surveyed, and down-hole surveying was undertaken at 50m
intervals starting at 25m after commencement. The down-hole survey was conducted with S42 little
calibre compass clinometer.
The recovery rates for all mineralised drill cores were 100%, a nd for all rock cores were 99%. As
design cementation collar seal was conducted and the #425 cement was used for collar seal.
A total of 9,381.5 m underground adits were used for resource estimate. The profile of the adits was
2.0m × 2.0m.
Lianhuashan #26 Vein
A total of 13 drillholes with a total length of 2,787.39m were conducted at the Lianhuashan #26 Vein.
The holes were drilled by XY-4 drill rigs, with a starting diam eter of 110 mm. After passing through
– IIIA-120 –
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Exploration, Sampling, Analytical Procedures and Quality Assurance and Quality Control  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 59
the Quaternary loose sediments, the drill bit with a diameter of 75 mm was used until termination of
the hole.
The collars of the holes were properly surveyed, and down-hole surveying was undertaken at 50m
intervals starting at 25m after commencement. The down-hole sur vey was conducted with CX-6B
little calibre compass clinometer.
The recoveries for all mineralised cores varied from 94% to 100%, and for all rock cored varied from
93% to 100%. As design cementation collar seal was conducted and the #425 cement was used for
collar seal.
A total of 1,578.60m underground adits were used for resource estimate. The profile of the adits was
2.0m × 2.0m.
Lianhuashan #3&7 Vein
Fifty drill holes, with a total length of 5,879.44m were conduc t at the Lianhuashan #3&7 Vein. All
holes were drilled by XY-4 drill ri gs, with a starting diameter  of 91 mm. After passing through the
Quaternary loose sedimentary layers, the drill bit with a diameter of 75 mm was used until termination
of the hole.
The collars of the holes were properly surveyed, and down-hole surveying was undertaken at 50m
intervals starting at 22 m after commencement. The down-hole su rvey was conduct with S42 little
calibre compass clinometer.
The recoveries for all mineralised cores varied from 94% to 100%, and for all rock cores varied from
93% to 100%. As design cementation collar seal was conducted and the #425 cement was used for
collar seal.
A total of 5,113.66m underground tunnels were used for resource estimate. The profile of the tunnels
was 2.0m × 2.0m.
6.2.3 Wulong Project
As described in section 5.1.3, the region geological and mineral exploration began in the 1960s and
several phases of exploration work had been carried out since then. SRK was not provided with the
former data. Only the resource and reserve verification work at  Wulong Mine in 2019, the detailed
exploration work at Ligunzi deposit in 2011, and the detailed e xploration work at Haojingou-Ligunzi
deposit from 2012 to 2017 are discussed in this section. A summary of the exploration workloads is
listed in Table 6-7.
Table 6-7: Summary Characteristi cs of Trenching, Drilling and Tunnelling
Item Wulong Ligunzi Haojingou-Ligunzi
Trenching/m3 / 506 28,974.53
Surface Drilling/m / 1,097.8 20,026
Underground Drilling/m / / 1,021.9
Tunnelling/m 3,650 308 1,619
Sampling 2,229 400 2,334
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Exploration, Sampling, Analytical Procedures and Quality Assurance and Quality Control  Final
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Wulong Mine
A total of 3,650m underground tunnels were excavated by Wulong Mining. The profile of drift was
1.8-2.0m × 2.0-2.2m, and the slope of drift was 0.3%-0.7%. The sketch map of the tunnels was drawn
at a scale of 1:100.
Ligunzi Gold Deposit
The purpose of trenching was to reveal gold mineralised body ex posed at surface and the trench
was perpendicular or roughly perpendicular to the mineralised body strike with a spacing of 100-160
m. The bottom width is 0.6-0.8 m and the top width varied depen ding on the looseness of the soil
and the depth of the trench. At least 0.3 m of the bedrock should be excavated. All the trenches were
named regularly and were surveyed by the total station or GPS. The sketch map of the trenches was
drawn at a scale of 1:100.
In 2010, two drillholes were drilled by the diamond wire line c ore drilling technique with the XY-4
drilling rig. The diameter is 75 mm. The boreholes surveys were done with the XJL compass
clinometer. The depth was verified. The rock recovery was over 90% while the mineralised core was
over 98%. The bores were sealed with clay and cement mortar.
Haojingou-Ligunzi Gold Deposit
A total of 559 trenches with a total of approximately 28,712.33m3 were completed. The width of trench
was 1-1.2 m on the top and 0.6-08 m at the bottom. The depth wa s 0-3 m and at least 0.3 m of the
bedrock should be excavated. Afte r completion of the trenches, geological logging and sampling
were performed in a timely, correct, and objective way and sket ched the trenching at 1: 100 scale.
The wall was sketched in its natural form and the bottom was ma pped at 1.0m wide. The trench
logging provided detailed text description of the lithology, structure, Mineralisation, and alteration.
Six trenches with a total of 262.3 m 3 were rehandled. The width at the bottom was 0.8-1.0 m. The
depth was 0-3 m and at least 0.3-0.5 m of the bedrock should be excavated.
A total of 73 surface boreholes with an aggregate length of 20,026m were drilled during the detailed
exploration period in the exploration license area (Figure 6-3). The types of the drilling rigs were XY-
4, XY-44 and XY-B6. The hole’s diameter is 75 mm, and the core diameter is 53 mm.
The cores were cleaned, labelled, and placed regularly. The recovery rates for all rock cores varied
from 88% to 100% and for all mineralised cores varied from 80% to 100%. The hanging wall and
footwall recoveries were between 92% and 100%. The collars of holes were surveyed properly, and
down hole survey was undertaken at 50 m intervals. Hole depth was verified at the interval of 50 m
and after the bore was finished. The maximum error of hole dept h correction is 0.1 m. Initial record
on site included shift reports, ore/rock core cards, ore/rock recovery, and depth verification record,
were orderly and reliable. The bores were sealed with clay and cement mortar and the collars were
marked.
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Figure 6-3: Distribution Map of Drillholes

A total of 14 underground boreholes with an aggregate length of 1,021.9m were drilled with the hole
diameter of 47 mm and the core diameter of 35 mm. Hole depth wa s verified at the interval of 50
meters and after the bore was finished. Hole depth was verified after the bore was finished.
A total of 1,619m tunnels were excavated at the Haojingou-Ligun zi gold deposit. The profile of the
tunnels was 2.0-2.2m × 1.8-2.5m, and the slope was less than 0.3-0.5%.
SRK was not provided with the whole phase of exploration work d ata. The exploration or mineral
work including the resource and reserve verification work of Wu long mine in 2019, the detailed
exploration work of Ligunzi deposit in 2011, and the detailed e xploration work of Haojingou-Ligunzi
deposit from 2012 to 2017 was checked and accepted by the mine.  All the three reports were
reviewed by the local geological authorities.
6.2.4 Hanfeng Project
The deep exploration of Lishan Mine (below -92m asl) lasted nine years and one month from August
2011 to August 2020. As of 20 A ugust 2020, a total of 46,351.96  m of drilling and 6,384.80 m of
tunnelling exploration were completed at the Lishan Mine below -92m asl (see Table 6-8).
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The deep exploration programme of the Dongfeng Molybdenum Mine (below 250m asl) was
conducted from December 2013 to February 28, 2023, including ge ological mapping in tunnels, as
well as tunnel exploration and drilling. The exploration depth ranged from 250 m to -600 m. A total of
3,611.9m of drilling and 3,499.54m of tunnel exploration were c ompleted from 2013 to 2017 and
totalling 82,101.16 m of drilling and 1,207.80m of tunnel explo ration were conducted from 2019 to
2023.
A summary of the exploration work of Hanfeng Project is listed in Table 6-8
Table 6-8: Drilling and Tunnelli ng Summary of Hanfeng Project
Item Lishan Dongfeng
Surface Drilling/m 3,573.1 23,828.38
Underground Drilling/m 42,778.86 73,525.42
Tunnelling/m 6,384.8 14,707.34
Drilling Sample 9,127 33,207
Tunnelling Sample 789 702
6.2.5 Jintai Project
As described in Section 6.1.2, a summary of the exploration workloads is listed in Table 6-9.
Table 6-9: A Summary of Charac teristics of Trenching and Drilling
Item Mining area Exploration area
Trenching/m3 8,158 3,781.57
Drilling/m 2,917.91 11,699.47
Sampling 1,650 9,629

The purpose of trenching was to reveal gold mineralised body ex posed at surface and the trench
was perpendicular or roughly perpendicular to the mineralised body trend. The bottom width is 0.6-
1.0 m and the top width varied from 2.2 m to 2.5 m. At least 0.3 m of the bedrock should be excavated.
All the trenches were named regularly.
The geological logging and sampling were carried out in time to avoid rain collapse.
Most of the trenches were not included in the Mineral Resource estimate, just for the purpose of gold
domain exploration.
A total of 192 surface drillholes with an aggregate length of 14,617.38 m were drilled in both mining
and exploration licence areas from 2007 to 2022 (see Figure 6-4).
The hole’s diameter is greater than 75 mm, and the core diameter is 55 mm. The cores were cleaned,
labelled, and placed regularly. The recovery rates for all rock cores varied from 82% to 100% and for
all mineralised cores varied from 81% to 99%. The collars of holes were surveyed properly, and down
hole survey was undertaken at 50 m or 100 m intervals. Hole depth was verified at the interval of 50
m or 100 m and after the bore was finished. The maximum error o f hole depth correction is 0.1 m.
Initial record on site included shift reports, ore/rock core ca rds, ore/rock recovery, and depth
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verification record, were orderly and reliable. The bores were sealed with clay and cement mortar
and the collars were marked.
Figure 6-4: Map Showing th e Distribution of Drilling

Source: ArcGIS Mapping

6.2.6 SRK Comments
SRK has reviewed the drilling spacing and quality for all the f ive projects. SRK is confident that the
drilling is sufficient for the Mineral Resource estimation.
6.3 Sampling, Sample Preparation , Analysis and Quality Control
6.3.1 Jilong Project
Sampling
Samples were taken from drill cores by splitting along the core axis. The sample length ranges from
0.8m to 1.0m. The weight of samples was between 9.45 kilograms (“kg”) and 12.38kg.
All tunnel samples were sampled using channelling method. The samples positions were determined
by the geologists and were sampled by the other workers. The sa mple channel was perpendicular
or roughly perpendicular to the strike of mineralised body. The section of channel was 10 cm × 5 cm,
and the sample length ranges from 0.1 to 1.2m. The sample inter vals were 6 m in ore drift 6 m and
40 m in transverse drift.
Sample Preparation and Analysis
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The sample preparation was according to the Chechott formula: Q =Kd2, K=0.8. The core sample
preparation was conducted in the following procedures:
 the original samples were crushed passing a mesh of 30 screen.
 sub-sample with 700 grams (“g”) was collected from a riffle splitter, and
 the sub-sample was pulverized passing a mesh of 200 screen; and  about 20g of pulp sample
was bagged and labelled for analysis. The rest was stored as a pulp reject.
Spectrum and chemical analysis were employed for sample analyse s. The basic item for chemical
analysis is gold, which was assayed using a 20g fire assay with determination by atomic absorption
spectroscopy (“ AAS”) method at Chifeng Geology and Exploration Laboratory (“ Chifeng
Laboratory”) according to the Geology and Mineral Laboratory Testing Quality Management
Specification DZ/T0130.3-2006.
Specific Gravity Data
A total of 227 samples for specific gravity (“ SG”) measurement were collected from underground
channelling samples at the Zhuanshanzi #1#2#3&depth Block and d rilling cores for specific gravity
analyses. The average specific gravity for is 2.80g/cm3.
A total of 110 sample for the SG measurement were collected from underground channelling samples
and drilling cores at the Zhuanshanzi #4#5#6#7 Block for specif ic gravity analyses. The average
specific gravity for is 2.81g/cm3.
Quality Assurance and Quality Control Programs
Before 2018, for the Zhuanshanzi #1#2#3&depth Block, a total of  853 samples were randomly
selected for internal check, which represented 10.3% of the original analytical samples (i.e., 8,276
samples). The results show that 840 samples are qualified, with  a qualification rate of 98.48%. A
total of 447 samples were selected for external check and were couriered to the Laboratory of the
10th Geology and Mineral Exploration Institute of Inner Mongolia (“Laboratory 10”) for analyses. The
results indicate that 441 samples are qualified, with a qualification rate of 98.66%.
For the Zhuanshanzi #4#5#6#7 Block, a total of 50 samples were selected for internal check, which
represented 24.5% of the original analytical samples (i.e., 204  pieces).  The results show that 48
pieces are qualified, with a qualification rate of 96%. A total  of 30 samples were selected and
couriered to the Laboratory 10 for external check. The results show that 29 samples are qualified,
with a qualification rate of 96.67%.
In 2018, a total of 1,150 samples were selected as internal dup licates, taking 10% of total, the
qualification rate is 98.32%; a total of 596 samples were selec ted and sent to Chengde No. 514
Geological Assay Co., Ltd. (“Chengde 514”) for external check, taking 5% of total, the qualification
rate is 97.32%. All duplicate gold grades versus original sample gold grades have been plotted into
the scatter charts to check the performance as shown in Figure 6-5. Assay results of internal and
external check samples display good correlations with the majority of original assay results.
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Figure 6-5: Performance of Internal and External Samples from 2 018 Production
Exploration by Jilong Mining

Source: SRK
6.3.2 Huatai Project
Sampling
Samples were taken from drill cores by splitting along the core axis. The sample length ranges from
0.8m to 1.0m. The weight of samples was between 9.45 and 12.38kg.
The tunnel samples were collected using channelling method. The  samples positions were
determined by the geologists and were sampled by the other work ers. The sample channel was
perpendicular or roughly perpendicular to the strike of mineralised body. The section of channel was
10cm × 5cm, and the sample length ranges from 0.1m to 1.5m. The  sample intervals were 6 m in
ore drift and 40 m in transverse drift.
Sample Preparation and Analysis
The sample preparation was based on the Chechott formula: Q=Kd 2, K=0.8. The core sample
preparation was conducted in the following procedures:
 the original samples were crushed passing a mesh of 30 screen.
 sub-sample with 700 g was collected from a riffle splitter, and
 the sub-sample was pulverized passing a mesh of 200 screen; and  about 20g of pulp sample
was bagged and labelled for analysis. The rest was stored as a pulp reject.
Spectrum and chemical analysis were employed for sample analyse s. The basic item for chemical
analysis is gold, which was assayed using a 20g fire assay with  determination by AAS method at
Chifeng Laboratory according to the Geology and Mineral Laboratory Testing Quality Management
Specification DZ/T0130.3-2006.
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Specific Gravity Data
All samples used for the SG measurement were collected from underground channelling samples
and drilling cores at the Lianhuashan #5 Mining Zone, Lianhuash an #26 Vein, lianhuashan #3&#7
Vein, Honghuagou #1 Mining Zone, Honghuagou #86 Vein and Pengji ajia Mine. for specific gravity
analyses. The average results of specific gravity measurement f or the Huatai Project are listed in
Table 6-10.
Table 6-10: Results of Specific Gravity Measurement for Huatai Project
Mine Sample Count. Average SG Value (g/cm 3)
Lianhuashan #5 Mining Zone 96 2.80
Lianhuashan #26 Vein 30 2.86
Lianhuashan #3&#7 Vein 35 2.80
Honghuagou #1 Mining Zone
256

Mineralised Body 2#, Sub-area 1# 3.10
Mineralised Body 14#, Sub-area 1# 2.88
Mineralised Body 82#, Sub-area 1# 2.81
Sub-area 3# 2.82
Vein 3# 2.80
Longtoushan 2.88
Honghuagou #86 Vein 35 2.80
Pengjiagou Mine 30 2.70

Quality Assurance and Quality Control Programs
During the deep exploration of the Lianhuashan #5 Mining Zone in 2018, a total of 54 samples were
selected for internal check, which represented 12% of the total  number of samples analysed (449
samples). The return results show that the qualification rate is 96.30%. Totalling 30 pieces samples
were selected and couriered to the Laboratory of 514 th Geology Brigade (“ Laboratory 514”) for
external check. The analytical results indicate that the qualification rate is 96.67%.
For the Lianhuashan #26 Vein, a total of 30 samples were select ed for internal check, which
represented 8.8% of the total number of samples analysed (342 samples), and the results show that
30 pieces are qualified, with a qualification rate of 100%.  A total of 31 samples were selected and
couriered to the Laboratory 10 for external check, and the results show that 29 pieces are qualified,
with a qualification rate of 96.67%.
A total of 82 samples were selected from the Lianhuashan #3&#7 Vein for internal check, which
represented 22.5% of the total number of samples analysed (264 samples). The results show that
79 pieces are qualified, with a qualification rate of 86.64%. T otalling 63 samples were selected and
couriered to the Laboratory 10 for external check. The results show that 61 pieces are qualified, with
a qualification rate of 96.82%.
During the resource and reserve verification program at the Honghuagou #1 Mining Zone in 2010, a
total of 312 samples were selected for internal check, which represented approximately 11.3% of the
total number of samples analysed (2,786 samples). The results s how that 304 pieces are qualified,
with a qualification rate of 97.44%. A total of 166 samples wer e selected and couriered to the
Laboratory 10 for external check, and the results show 160 piec es are qualified, with a qualification
rate of 96.39%. During the resource and reserve verification program in 2017, a total of 70 samples
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were selected for internal check, which represented about 13.4%  of the total number of samples
analysed (524 samples) and the results show that 69 pieces are qualified, with a qualification rate of
98.57%. Totalling 38 samples were selected and couriered to the Laboratory 514 for external check,
and the results show that 37 pieces are qualified, with a qualification rate of 97.37%.
For the Honghuagou #86 Vein, a total of 30 samples were selected for internal check, which
represented about 9% of the total number of samples analysed (334 samples). The results show that
30 pieces are qualified, with a qualification rate of 100%. A t otal of 30 samples were selected and
couriered to the Laboratory 10 for external check, and the results show that 29 pieces are qualified,
with a qualification rate of 96.67%.
For the Pengjiagou Mine, a total of 51 samples were selected for internal check, which represented
about 14.9% of the total number of samples analysed (342 samples). The results show that 30 pieces
are qualified, with a qualification rate of 96.58%. Totalling 30 samples were selected and couriered
to the Laboratory 10 for external check, and the results show t hat 29 pieces are qualified, with a
qualification rate of 95.26%. Figure 6-8 shows the internal and  external checks performance of the
Pengjiagou Mine.
Figure 6-6: Internal and External Samples Performance of the Pe ngjiagou Mine
6.3.3 Wulong Project
Sampling
The drilling core samples were sampled by 1/2 split core method. The sample length was 1.0 m. The
maximum length was 1.5 m, and the minimum length was 0.2 m.
All tunnel samples were taken by channelling method. The sample s positions were determined by
the geologists and were sampled by the other workers. The sampl e channel was perpendicular or
roughly perpendicular to the strike of mineralised body. The profile of channel was 10cm × 5cm, and
the length was 1m. The maximum length was less than 1.5m. The s ample intervals were 6m in ore
drift and 40m in transverse drift.
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The trench samples were taken by channeling method. The section  of channel was 10cm × 3cm,
and the length was less than 1.5 m.
A total of 229 samples, 400 samples and 2,334 samples were respectively collected from the Wulong
Mine during the resource and reserve verification program in 20 19 the Ligunzi gold deposit during
the detailed exploration in 2011 and the Haojingou-Ligunzi gold  deposit during the detailed
exploration from 2012 to 2017.
Sample Preparation and Analysis
The sample preparation was according to the Chechott formula: Q =Kd2, K=0.8. The sample
preparation was conducted in the following procedures:
 the original samples were firstly coarse crushed by the jaw crusher and were crushed to 10mm.
 the samples were then medium crushed to 0.25 mm (60 mesh) by rod mill.
 the sub-sample with 350-450g was collected as duplicate from a riffle.
 the sub-sample with 150-500g was collected from a riffle, was t hen pulverized passing a mesh
of 200 screen, and then was packed and labelled for analysis.
Samples from the Wulong Mine were analysed by the laboratory of Liaoning 7th Geological Brigade
Co., Ltd. (“ Laboratory 7”). Samples from the Ligunzi and Haojingou-Ligunzi gold deposit s were
assayed by the laboratory of the Brigade 103 of Liaoning Non-ferrous Geology Bureau (“Laboratory
103”). The basic item for chemical analysis is gold using AAS method at these laboratories according
to the Specification of Testing Quality Management for Geological Laboratories (DZ/T0130).
Specific Gravity Data
A total of 90 SG ore samples were collected from the tunnels at  the Wulong Mine and a total of 48
SG samples were collected from drilling cores at Haojingou-Ligu nzi gold deposit according to the
different grade resulted from the basic analyses. The samples s ize was 5cm × 5cm × 5cm. They
were sealed and sent to the Laboratory for both gold and SG analysis.
Figure 6-7 is scatter plots of the specific gravity against gol d content. The results show that the SG
has no significant correlation against the gold grade for Wulong Mine and Haojingou-Ligunzi gold
deposit. The average results of SG samples are 2.67g/cm 3 for Wulong Mine and 2.69g/cm 3 for
Ligunzi and Haojingou-Ligunzi deposits, which can be applied in the resource estimation.
– IIIA-130 –
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SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 69
Figure 6-7: Scatter Plots of SG against gold Grade
Source: SRK
Note: Wulong Mine (left) and Haojingou-Ligunzi Gold Deposit (right)
Quality Assurance and Quality Control Programs
In the Wulong Mine, a total 198 samples, accounting for 8.9% of the total number of samples assayed
(2,230 sample) were selected and reanalysed in the Laboratory 103 for internal checking, while 132
samples, accounting for 5.9% of the total number of analysed sa mples, were sent to the laboratory
of Liaoning Nuclear Geological Survey (“Liaoning Lab”) for external lab checking.
The quality control samples summary is shown in Table 6-11, and  the performances of the internal
and external lab checks are shown in Figure 6-8.
Table 6-11: Summary o f Wulong QA/QC data
Category Data Pairs Coverage
Relative Difference
<10% 10%-20% >20%
Internal 198 8.88% 172 86.87% 22 11.11% 4 2.02%
External 132 5.92% 117 88.64% 12 9.09% 3 2.27%
Figure 6-8: Internal and External Performance of Wulong Mine
Source: SRK
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In the Ligunzi gold deposit, a total of 30 samples were re-analysed in the Laboratory 103 for internal
checking and a total of 15 samples were sent to Liaoning Lab fo r external lab checking. The pass
rates were 97% for internal checks and 100% for external checks.
In the Haojingou-Ligunzi gold deposit, a total of 233 samples were re-assayed in the Laboratory 103
for internal checking, with a proportion of 10% and a total of 115 samples were sent to Liaoning Lab
for external checking, with a proportion of 4.9%.
The QC samples summary is shown in Table 6-12 and the performance of the internal and external
lab check are shown in Figure 6-9.
Table 6-12: Summary of Haojingou-Ligunzi QC data
Category Data Pairs Coverage
Relative Difference
<10% 10%-20% >20%
Internal 231 9.90% 118 51.08% 83 35.93% 30 12.99%
External 115 4.93% 98 85.22% 13 11.30% 4 3.48%

Figure 6-9: Internal and External Performance of Haojingou-Ligu nzi Gold Deposit

Source: SRK
6.3.4 Hanfeng Project
Lishan Mine
A resource and reserve verification program for both Lishan and  Dongfeng mines was carried out
from 2010 to 2011. A deep exploration of Lishan Mine (-92m asl) was executed during 2011 to 2020.
Tunnel Sampling
The tunnel samples were carried out using a channeling method. The section of channel was
10cm×3cm, and most of the sample length was less than 2m. The s ampling work was conducted
using chisel and hammer. The samples representation met the needs of mineralised body evaluation.
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A total of 2,853 channel samples of Lishan Mine were taken sepa rately based on different
mineralisation types.
During the deep exploration at Lishan Mine (-92m asl) from 2011 to 2020, the tunnel samples were
sampled at the waistline of tunnel continuously based on differ ent rock type and grade rank using
channelling method. The samples were marked with red paint after sample division. The section size
of the channel sample was 10cm × 3cm, and the sample length is generally 1.0-1.5m. The sample
weight was generally 9.5-10.5kg. A total of 789 samples were collected.
Drilling Core Sampling
A total of 194 boreholes were drilled. The hole diameter of the  drilling is 75mm with wire-line coring
method. The cores were kept the original structural characteris tics and integrity without ore core
crushing, dilution and leakage during drilling.
The drilling samples were sampled by ½ split core method. The s ample length was determined by
core recovery, thickness of mineralised body and Mineralisation . The core was split along the core
axis into two halves by the YPK-1 type core splitter. One half was retained as the core, and the other
half was bagged and weighed before being sent to the laboratory for analysis. The sample length
generally ranged from 1.00m to 1.50m, with a few samples rangin g from 0.30m to 0.80m and the
longest being 1.90m. A total of 9,127 borehole samples were collected during this stage. The average
recovery rate was 99%. The sample weight was between 0.80kg and 4.40kg.
Sample Preparation and Analysis
The sample preparation included coarse crushing (jaw crusher), medium crushing (disc mill) and fine
crushing (disc mill). Each stage was divided into crushing, scr eening, mixing and shrinkage. The
samples analyses were undertake n by the 6th laboratory of Jilin  geology and survey Institute.
According to DZG93-09 analysis procedures, the analysis instrum ent for Pb, Zn, Cu is GGX-600
atomic absorption spectrophotometer, the analysis method is AAS method.
During the deep exploration of  Lishan Mine (-92m asl) from 2011  to 2020, the sample preparation
followed drying, crushing, screening, mixing and splitting proc edures. After crushing, the samples
were pulverised to 200 mesh and then about 400g was taken for a ssay and the remains of the
pulverised material were stored in the laboratory as pulp rejects.
Specific Gravity Data
From 2011 to 2020, the samples were collected from cores and tunnels from the Mineralised bodies
with various grades and positions. The wax method was used for the SG test.
A total of 466 SG samples were collected, including 326 core samples and 140 channel samples,
among which the samples of copper-zinc ores accounts for 36%, l ead- zinc ores account for 12%,
zinc ores account for 46%, and copper ores account for 6%.
Quality Assurance and Quality Control Programs
From 2010 to 2011, a total of 2,853 channel samples were taken,  and 288 samples were taken for
internal check, with a proportion of 10.09%, and 144 samples fo r external check, accounting for
5.05% of the total samples, were sent to the 4 th Laboratory of Chemical Geology and Mining
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(“Laboratory 4”) for analyses. The sample summary is shown in Table 6-13, and  the performance
of the internal and external checks are shown in Figure 6-10.
Table 6-13: QA/QC Data Summary of Lishan Mine from 2010 to 2011
Sample
Sample Number Assay result
Count Percent
（（%））
Cu Pb Zn
Samples
Above
10x Det.
Lim.
Pairs ≤
10%
HARD (%)
Samples
Above 10x
Det. Lim.
Pairs ≤
10%
HARD (%)
Samples
Above 10x
Det. Lim.
Pairs ≤ 10%
HARD (%)
Internal
Checks 288 10.09 31 89.24 35 87.85 25 91.32
External
Checks 144 5.05 11 92.36 13 90.97 12 91.67
Figure 6-10: Internal and Externa l Checks of Lishan Mine from 2020-2011
Note: Internal checks on the left and External checks on the right
From 2011 to 2020, a total of 9,916 basic analysis samples, 116 combination analysis samples and
26 phase analysis samples of the Lishan deposit (below -92m asl ) were collected. there are 1,208
internal check samples and 710 external check samples for zinc, 80 internal check samples and 40
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external samples for copper, 80 internal check samples and 12 external samples for lead. The pass
rates of internal and external samples are list in Table 6-14 and the performance of the internal and
external checks are shown in Figure 6-11.
Table 6-14: QA/QC Data Summary of  Lishan Mine (below -92m asl) from 2011 to 2020
Item Year Samples
number Qualified Pass rate（ （%））
Basic analysis (Zn)
Internal check
2018 308 298 97
2019 510 489 96
2020 390 374 96
Sub total 1,208 1,160 96
External check 2018 150 141 94
2019 360 349 97
Basic analysis (Zn) External check 2020 200 199 100
Sub total 710 689 97
Basic analysis (Cu) Internal check 2020 80 76 95
External check 2020 40 40 100
Basic analysis (Pb) Internal check 2020 80 79 99
External check 2020 40 40 100
Combination
analysis (Zn)
Internal check 2020 12 12 100
External check 2020 5 5 100
Combination
analysis (Cu)
Internal check 2020 4 4 100
External check 2020 2 2 100
Combination
analysis (Pb)
Internal check 2020 1 1 100
External check 2020 1 1 100
Figure 6-11: Internal Check of Lishan Deposit （（bellow -92m asl）） from 2011 to 2020
– IIIA-135 –
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Note: Internal checks on the left and External checks on the right
Dongfeng Mine
Tunnel Sampling
Tunnel sampling was carried out using channelling method for newly discovered mineralised bodies,
residual mineralised bodies and mineralised bodies missing prev ious laboratory data. The samples
are arranged as vertically as possible to the direction of mineralised bodies. The section of channel
size is 10cm × 3cm, and the most sample length is less than 2 m.  A total of 1,216 channel samples
were taken from different mineralisation types in 2010 to 2011.
During the deep exploration of Dongfeng deposit (-250m asl) from 2013 to 2023, the tunnel samples
were sampled at the waistline of tunnel continuously based on d ifferent rock type and grade rank
using channelling method. The section size of the channel sample was 10cm × 3cm, and the sample
length is generally 1.0-1.5m. The sample weight was generally 7 .5-8.5kg. A total of 702 samples
were collected.
Core Drilling Sampling
A total of 252 boreholes were drilled from 2013 to 2023. The hole diameter of the drilling is 75mm
with wire-line coring method. The cores were kept the original structural characteristics and integrity
without ore core crushing, dilution and leakage during drilling.
The drilling samples were sampled by ½ split core method. The s ample length was determined by
core recovery, thickness of mineralised body and Mineralisation . The core was split along the core
axis into two halves by the YPK-1 type core splitter One half was retained as the core, and the other
half was bagged and weighed before being sent to the laboratory  for analysis. The sample length
generally ranged from 1.00m to 1.50m, with a few samples ranging from 0.3m to 0.8m and the longest
being 2.0 m. A total of 33,207 borehole samples were collected during this stage. The average
recovery rate was 99.87%. The sample weight was between 0.63kg and 3.86kg.
Sample Preparation and Analysis
The sample preparation included coarse crushing (jaw crusher), medium crushing (disc mill) and fine
crushing (disc mill). Each stage was divided into crushing, scr eening, mixing and shrinkage. The
sample testing work was undertaken by the 6th laboratory of Jil in geology and survey Institute.
According to DZG93-09 analysis procedures, the analysis instrument for Pb, Zn, Cu is GGX-600
atomic absorption spectrophotometer, the analysis method is AAS method.
– IIIA-136 –
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Specific Gravity Data
In 1987, the Brigade 650 of Jilin Nonferrous Metal Geological E xploration Company collected 175
SG samples from different levels of Dongfeng Pb-Zn Mine. The average SG is 3.26g/cm3, and there
was no significant difference between the different mining levels.
A total of 310 SG samples were taken from orebodies in the deep  area of Dongfeng Mine (-250m
asl), of which 227 from drillings and 83 samples form tunnels.
Quality Assurance and Quality Control Programs
From 2010 to 2011, resource and reserves verification of Dongfeng Deposit was carried out. A total
of 1,216 channel samples were taken from Dongfeng lead-zinc dep osit, including 705 Pb, Zn, Cu
samples, of which 71 samples was taken for internal check and 3 5 samples was taken for external
check. A total of 511 channel samples were taken from Mo sample, of which 52 samples was taken
for internal check and 26 samples was taken for external check.
The Chemical Geology and Mining Laboratory #4 carried out exter nal analysis. The pass rates of
internal and external samples are list in Table 6-15 and the performance of the internal and external
checks are shown in Figure 6-12 and Figure 6-13.
Table 6-15: QC Data Summary  of Dongfeng Deposit in 2011
Item
Sample
Percent (%)
Pass rate
Count
Cu Pb Zn Mo
(%) (%) (%) (%)
Internal check
Cu Pb Zn：71 10.07
92.96 85.92 88.73 92.31
Mo：52 10.17
External check
Cu Pb Zn：35 4.96
91.43 94.29 91.43 93.21
Mo：26 5.09
Figure 6-12: Internal check of  Dongfeng Deposit in 2011
– IIIA-137 –
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Exploration, Sampling, Analytical Procedures and Quality Assurance and Quality Control  Final
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Figure 6-13: External check of Dongfeng Deposit in 2011


From 2013 to 2023, a total of 33,909 basic analysis samples, 141 combination analysis samples and
114 phase analysis samples of the Dongfeng deposit (below 250m asl) were collected. and there are
3,832 internal check samples and 2,431 external check samples f or Mo. The pass rates of internal
and external samples are list in Table 6-16 and the performance of the internal and external checks
are shown in Figure 6-14.
Table 6-16: QA/QC Data Summary of Dongfeng Deposit from 2013 to 2023
Item Sample Count Percent (%) Pass rate
Internal check 3,832 11.3 96.41
External check 2,431 7.17 97
– IIIA-138 –
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Exploration, Sampling, Analytical Procedures and Quality Assurance and Quality Control  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 77
Figure 6-14: Mo Internal check of Dongfeng Deposit from 2013 to  2023

6.3.5 Jintai Project
Trench Sampling
In the mining licence area, a total of 618 channel samples were taken separately based on different
mineralisation types. The section of channel was 10 cm × 5 cm, and most of the sample length was
1.2 m.
In the exploration licence area, a total of 540 channel samples  were collected separately based on
different mineralisation types. The section of channel was 10 cm × 3 cm, and the length ranged from
1.0 m to 1.5 m.
The samples representation met the needs of mineralised body evaluation.
Core Drilling Sampling
In the mining licence area, samples were collected separately b ased on different mineralisation
types. The drilling samples were sampled by ½ split core method. The sample length was determined
by core recovery, thickness of mineralised body and mineralisation, ranging from 0.5 m to 1.5 m.
In the exploration licence area, a total of 9,089 samples were collected separately based on different
Mineralisation types. The drilling samples were sampled by ½ split core method. The sample length
was determined by core recovery, thickness of mineralised body and mineralisation, ranging from 1
m to 1.5 m. The samples were collected by manual in the loose rock area, while hard rock with core
splitter.
The samples representation met the needs of mineralised body evaluation.
Sample Preparation and Analyses
From 2007 to 2010, a general exploration for Xidengping deposit  was carried out. The sample
preparation included coarse crushing, medium crushing and fine crushing. Each stage was divided
into crushing, screening, mixing and shrinkage. The samples ana lyses were undertaken by the lab
of Kunming Mineral Resources Supervision and Testing Centre and Yunnan 3rd Geological Brigade
(“Kunming Laboratory”). The basic analysis item was g old. Both internal and externa l lab check
– IIIA-139 –
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Exploration, Sampling, Analytical Procedures and Quality Assurance and Quality Control  Final
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samples were according to the Specification of Testing Quality Management for Geological
Laboratories.
From 2020 to 2021, Mineral Resource verification was conducted. The sample preparation included
coarse crushing, medium crushing and fine crushing. Each stage was divided into crushing,
screening, mixing and shrinkage. The total loss rate was less t han 5%. The K value was set to 0.5
in the formulation Q = Kd 2 and the sample was crushed to 0.074 mm (200 mesh). Samples wer e
analysed by the central laboratory of Yunnan Bureau of Geology and Mineral Resources Exploration
and Development (“ Central Laboratory”). External check samples were sent to Henan Rock and
Mineral Testing Center (“Henan Laboratory”). The basic analysis item was gold. Both internal and
external lab check samples were according to the Specification of Testing Quality Management for
Geological Laboratories (DZ/T0130-2006).
From 2020 to 2022, advanced exploration was conducted. The sample preparation included coarse
crushing, medium crushing and fine crushing. Each stage was div ided into crushing, screening,
mixing and shrinkage. The samples were firstly coarse crushed by the jaw crusher and were crushed
to 4 mm. Then the samples were medium crushed by the disc mill and were crushed to 1 mm. After
that, there were the mixing and splitting procedures. The K value was set to 0.8 in the formulation Q
= Kd2 and the sample was crushed to 0.074 mm (200 mesh). Samples were analysed by the Central
Laboratory. External check samples were sent to Henan Laborator y. The basic analysis item was
gold. Both internal and external lab check samples were accordi ng to the Specification of Testing
Quality Management for Geological Laboratories (DZ/T0130-2006).
Specific Gravity Data
From 2007 to 2010, a total of 30 SG piece samples were collected from the mineralised bodies with
various grades and positions. The wax method was used for the SG test. The average SG was 2.14
g/cm3. And 2 bulk samples were collected, and the result was 1.76g/c m3. The SG samples were
more representative, so the SG value of 2.14g/cm3 was applied in the Mineral Resource estimate.
From 2020 to 2022, a total of 103 SG piece samples were collected from the mineralised bodies with
various grades and positions. The wax method was used for the SG test. 40 samples were collected
for domain V4, 31 samples were collected in the Xidengping area , and 32 samples were collected
for domain V8. The samples representation met the needs of mine ralised body evaluation. 4 bulk
samples were collected, and the result was consistent with piec e samples. The SG values were
2.15g/cm3 for domain V9 and V10, 2.29g/cm3 for domain V8, and 2.24g/cm3 for domain V4, V5, V6
and V7.
Quality Assurance and Quality Control Programs
From 2007 to 2010, general exploration for Xidengping deposit w as carried out. A total of 1,506
samples were sent to labs for gold grade. A total of 30 samples were taken for internal lab check with
a proportion of 1.99%. 30 samples were taken for external lab check with a proportion of 1.99%. The
qualification rate was 70% for internal check and 56.67% for external check.
The QA/QC samples summary is shown in Table 6-17, and the performance of the internal and
external lab check are shown in Figure 6-15.
– IIIA-140 –
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Exploration, Sampling, Analytical Procedures and Quality Assurance and Quality Control  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 79
Table 6-17: Summary of Gene ral Exploration QA/QC data
Category Data Pairs Coverage
Relative Difference
<10% 10%-20% >20%
Internal 30 1.99% 12 40.00% 9 30.00%  9 30.00%
External 30 1.99%  9  30. 00%  8 26.67%  13 43.33%

Figure 6-15: Performance of Internal and External Checks for General Exploration

From 2020 to 2021, Mineral Resource verification for Xidengping deposit was carried out. A total of
563 samples were sent to labs for gold grade. A total of 50 samples were taken for internal lab check
with a proportion of 8.91%. 31 samples were taken for external lab check with a proportion of 5.51%.
The qualification rate was 70% for internal check and 100% for external check.
The QA/QC samples summary is shown in Table 6-18 and the performance of the internal and
external lab check are shown in Figure 6-16.
Table 6-18: Summary of Resource Verification QA/QC data
Category Data Pairs Coverage
Relative Difference
<10% 10%-20% >20%
Internal 50 8.91%  21 42.00 %  14 28.00%  15 30.00%
External 31 5.51% 29 93.55% 2 6.45%  -   -

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Exploration, Sampling, Analytical Procedures and Quality Assurance and Quality Control  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 80
Figure 6-16: Performance of Internal and External Checks for Resource Verification

From 2012 to 2022, in the exploration licence area, a total of 9,629 samples were sent to labs for
gold grade. A total of 819 samples were taken for internal lab check with a proportion of 8.51%. 350
samples were taken for external lab check with a proportion of 3.63%. The qualification rate was
68.62% for internal check and 89.71% for external check.
The QA/QC samples summary is shown in Table 6-19, and the performance of the internal and
external lab check are shown in Figure 6-17.
Table 6-19: Summary of Advanced Exploration QA/QC data
Category Data Pairs Coverage
Relative Difference
<10% 10%-20% >20%
Internal 819 8.51% 369 45. 05% 193 23.57%  257 31.38%
External 350 3.63%  278 79.43 %  36  10.29%  36  10.29%

– IIIA-142 –
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Exploration, Sampling, Analytical Procedures and Quality Assurance and Quality Control  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 81
Figure 6-17: Performance of Internal and External Checks for Advanced Exploration

6.3.6 SRK Comments
In the opinion of SRK, the sampling, sample preparation and analytical procedures used for Jilong,
Huatai, Wulong, Hanfeng and Jintai projects are acceptable. The  pass rates of both internal and
external check samples for these projects are acceptable, while blank sample were not used in these
projects.
– IIIA-143 –
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SRK Data Verification    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 82
7 SRK Data Verification
7.1 Introduction
In accordance with the JORC Code guidelines, SRK team conducted  multiple site visits of the
Chifeng Gold’s five subsidiaries’ mining projects, including th e Jilong, Huatai and Wulong projects
from 22 to 26 December 2022, the Hanfeng project between 9 and 10 January 2023, and the Jintai
project on 8 March 2023 in the first round; the Jilong, Huatai,  Wulong and Hanfeng project from 14
to 19 May 2024 and the Jintai project from 21 to 23 May 2024 in  the second round, and the Jilong
and Wulong projects from 28 May 2024 to 1 June 2024 in the third round. During the site visit, SRK
conducted the following verification procedures:
 Site inspection of each project area by SRK’s competent persons and senior geologists.
 Met with Company representatives.
 Discussed with the technical personnels.
 Checked the historical exploration work.
 Borehole coordinates verification by handheld GPS.
 Inspection of the core warehouse.
 Witnessed underground channel sampling.
 Witnessed the underground and/ or open pit mining development, and
 Re-sampled historical pulp samples from the five projects.
7.2 Jilong Project
SRK used the cut-off grade of 1.0g/t Au to select verification samples, based on the exploration report
on the Zhuanshanzi Mine in 2018, a total of 154 samples have be en taken. The samples were re-
numbered and sent to SGS Mineral Laboratory located in Tianjin, China (“SGS Lab”) for verification
assay.
The assay results are listed in Appendix D and the scatter plots are shown in Figure 7-1. A large bias
was observed between original assay and check results, SRK has checked with both main laboratory
and SGS Lab staff, found that the sample preparation and sample assay methods are different, the
sample preparation protocol which the original main laboratory adopted is relatively conservative,
they use sieve to remove potential visible gold and then for as say to minimize the nugget effect,
which may lead to a system lower bias compared to SGS Lab using screen fire assay method. SRK
advised to send the samples to the Intertek laboratory in Beiji ng (“ Intertek Lab ”), for further
verification, the assay results are listed in Appendix D and plotted in Figure 7-1, a general trend can
be observed although larger biases are found in the higher grade samples, which may be led by the
nugget effect of visible gold .


– IIIA-144 –
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SRK Data Verification    Final
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Figure 7-1: Performance of SRK Ve rification Samples from Zhuanshanzi Mine

Source: SRK
7.3 Huatai Project
The data verification of Huatai project is divided into two par ts: one part is from the Honghuagou
Mine including #1 mining zone, #86 Vein and Pengjiagou Deposit;  the other part is from the
Lianhuashan Mine including #3&#7 Vein, #26 Vein and #5 mining zone.
SRK used the cut-off grade of 1.0g/t Au to select verification samples, a total of 50 pulp duplicate
samples are from the Honghuagou Mine and a total of 55 pulp sam ples are from the Lianhuashan
Mine. All samples were re-numbered and sent to SGS Lab for re-analysis.
The assay results from Honghuagou Mine are listed in Appendix B and plotted in Figure 7-2. A large
bias was observed between original assay and check results, SRK  has checked with both main
laboratory and SGS Lab staff, f ound that the sample preparation  and sample assay methods are
different, the sample preparation protocol which the original m ain laboratory adopted is relatively
conservative, they use sieve to remove potential visible gold a nd then for assay to minimize the
nugget effect, which may lead to a system lower bias compared to SGS Lab using screen fire assay
method. The samples have been sent to Intertek Lab for further verification, the assay results are
listed in Appendix B and plotted in Figure 7-2, and a general trend can be observed although larger
biases are found in the higher grade samples, which may be caus ed by the nugget effect of visible
gold
– IIIA-145 –
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FOR THE PRC MINES


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SRK Data Verification    Final
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For the verification samples from the Lianhuashan Mine, a large  bias was also observed between
original assay and check results. About 60% plotting pairs are within ±20%. About 40% pairs are out
of ±20%, which may be caused by the nugget effect. The assay results are listed in Appendix B and
plotted in Figure 7-3.
Figure 7-2: Performance of SRK Ve rification Samples from Honghuagou Mine



Source: SRK
Figure 7-3: Performance of SRK Ve rification Samples from Lianhuashan Mine

Source: SRK
– IIIA-146 –
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SRK Data Verification    Final
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7.4 Wulong Project
The data verification of Wulong Project is divided into two parts: one part is from the Wulong Mine
and the other part is from the Haojingou gold deposit and Haojingou-Ligunzi gold deposit.
SRK used the cut-off grade of 1.0g/t Au to select verification samples based on the Wulong Resource
and Reserve Verification report 2019, a total of 129 pulp sampl es are from the Wulong Mine and a
total of 36 pulps from the Haojingou and Haojingou-Ligunzi gold  deposits. All samples were re-
numbered and sent to SGS Lab for analysis.
The scatter plots are shown in Figure 7-4. The comparison of as say results between the original
samples and SRK check samples show that the relative differences between them are mostly within
±20%, with only a few pairs exc eeded ±20%, but is still accepta ble considering this type of gold
mineralisation.
Figure 7-4: Performance of SRK Ve rification for Wulong Project

Source: SRK
Note: Wulong Mine on the left and Haojingou and Haojingou-Ligunzi deposits on the right
7.5 Hanfeng Project
Lishan Project
SRK used the cut-off grade of 0.5% Zn to select verification sa mples. A total of 152 pulp samples
are taken from the Lishan Mine (based on the Lishan Exploration  Report 2020). The verification
samples were re-numbered and sent to SGS Lab for re-analysis. T he assay results are listed in
Appendix B and plotted in Figure 7-6. The scatter diagrams show that most of the returned analysis
results for Cu and Zn are within ±20%, the Pb have returned poorer performance, however, most of
which are in the very low grade, and therefore the results are considered acceptable.
– IIIA-147 –
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SRK Data Verification    Final
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Figure 7-5: Performance of SRK 2023 Verification Samples from Lishan Mine

Source: SRK
Dongfeng Project
SRK used the cut-off grade of 0.03% Mo to select verification samples. A total of 189 samples have
been taken from the Dongfeng Mine and were sent to SGS Lab for analysis. The assay results are
listed in Appendix B and plotted in Figure 7-6. The scatter dia grams show that all of the returned
analysis results for Mo are within ±20%, which are considered acceptable.
– IIIA-148 –
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SRK Data Verification    Final
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Figure 7-6:  Performance of SRK 2023 Verification Samples from Dongfeng Mine

Source: SRK
7.6 Jintai Project
SRK used the cut-off grade of 0.17g/t Au to select verification  samples. A total of 77 pulp samples
from different exploration phases are collected and are sent to  SGS Lab for analysis. Details of the
verification samples are presented in Appendix B, are summarise d in Table 7-1 and are plotted in
Figure 7-7. The scatter diagrams show that about 52% results for gold are within ±20%. About 48%
results are outside ±20%, which may be caused by the nugget effect.
Table 7-1: Summary of S RK Verification Samples
Phase Samples Samples
Au≥0.17
Verification
Samples
Percentage
Au≥0.17
General Exploration 684 256 13 5.08%
Mineral Resource Verification 880 50 2 4.00%
Advanced Exploration 9,629 1,505 62 4.12%
Total 11,193 1,811 77 4.25%

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SRK Data Verification    Final
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Figure 7-7: SRK 2023 Verification on Xidengping Gold Mine

Source: SRK
7.7 SRK Comments
Overall, SRK is satisfied with the quality and result of the sa mple preparation and assay conducted
by related analytical laboratories. The analytical procedures a re consistent with generally accepted
industry practices and the primary sample results are therefore  suitably reliable for use in Mineral
Resource estimation.
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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 89
8 Mineral Resource Estimates
8.1 Introduction
The Mineral Resource Statement presented herein represents Mine ral Resource estimation
prepared for the Chifeng Gold Project in accordance with the JORC Code.
The effective date of the Mineral Resource Statement is 30 September 2024.
This section describes the Mineral Resource estimation methodol ogy and summarizes the key
assumptions considered by SRK. In the opinion of SRK, the Mineral Resource estimation reported
herein is a reasonable representation of the global Mineral Res ources found in Jilong, Huatai,
Wulong, Hanfeng and Jintai project s at the current level of sam pling. The Mineral Resources are
reported in accordance with the JORC Code. The Mineral Resource s are not Ore Reserves and
there is no certainty that all or any part of the Mineral Resource will be converted into Ore Reserve.
The database used to estimate t he Chifeng Gold Project Mineral Resources was audited by SRK.
SRK is of the opinion that t he current drilling, tunnelling and  trenching information is sufficiently
reliable to interpret with confidence the boundaries for gold, lead-zinc and molybdenum
mineralisation and that the assay data are sufficiently reliabl e to support Mineral Resource
estimation.
The Surpac 2020.1 (“Surpac”) software was used to construct the grade solids, prepare assay data
for analysis, construct the block model, estimate gold grades, and tabulate Mineral Resources.
8.2 Mineral Resource Estimation Procedures
The Mineral Resource estimation methodology involved the following procedures:
 Database compilation and verification;
 Construction of wireframe models for the boundaries of the gold Mineralisation;
 Definition of resource domains;
 Data conditioning (compositing and capping) for analysis;
 Block modelling and grade interpolation;
 Resource classification and validation;
 Assessment of “reasonable prospects for eventual economic extraction (“RPEEE”)” and selection
of appropriate cut-off grades; and
 Preparation of the Mineral Resource Statement.
8.3 Mineral Resource Database
8.3.1 Jilong Project
Jilong Project is composed of the Zhuanshanzi Mine including tw o mineralised blocks of the
#1#2#3&depth Blocks and the #4#5#6#7 Block.
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Mineral Resource Estimates    Final
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SRK was provided with geological exploration reports and maps, topography, database, QAQC data,
and SG data. The coordinate system of Jilong Project is CGCS 20 00. SRK undertook a thorough
review for the database, followed by various verification procedures, and verified that the database
was acceptable for a Mineral Resource estimation.
Based on the data, SRK construc ted a Mineral Resource database,  composed of borehole collar,
survey, lithology, assay, and SG data. Table 8-1 summaries the database covering the entire project
area. The boundary of the estimation is the Zhuanshanzi mining licence.
Table 8-1: Mineral Resource Data base Statistics of Jilong Project
Mine/Deposit Type Counts Length ((m)) Assay
Samples
Zhuanshanzi Mine
(#1#2#3&depth Block)
Drillholes 81 1,9078.32 602
Tunnels 6,240 5,989.89 14,328
Total 6,321 25064.21 14,930
Zhuanshanzi Mine
(#4#5#6#7 Block)
Drillholes 64 10,810.47 339
Trenches 55 90.69 106
Tunnels 12 45.94 87
Total 131 10,947.1 532
8.3.2 Huatai Project
Huatai Project consists of the Honghuagou Mine including #1 Mining Zone and #86 Vein, the
Pengjiagou Mine and the Lianhuashan Mine including #5 Mining Zone, #26 Vein and #3-7 Vein.
The resource database included all the samples both from drillh oles and mining levels. SRK was
provided with geological exploration reports and maps, topography, database, QA/QC data, and SG
data. The coordinate system of Huatai Project is CGCS 2000. SRK undertook a thorough review for
the database, followed by various  verification procedures, and verified that the database was
acceptable for a Mineral Resource estimation.
Based on the data, SRK construc ted a Mineral Resource database,  composed of borehole collar,
survey, lithology, assay, and SG data. Table 8-2 summaries the database covering the entire project
area. The boundary of the estimation is the Honghuagou, Pengjia gou and Lianhuashan mining
licenses.
Table 8-2: Mineral Resource Database Statistics of Huatai Proje ct
Mine/Deposit Type Counts Length ((m)) Assay
Samples
Honghuagou mine
Drillholes 96 33,424.71 478
Tunnels 764 2,031.80 2,652
Total 860 35,456.51 3,130
Pengjiagou deposit
Drillholes 44 9,438.6 92
Tunnels 112 282.85 292
Total 156 9,721.45 384
Lianhuashan deposit
Drillholes 96 14,179.76 188
Tunnels 1,153 2,159.86 3,271
Total 1,249 16,339.62 3,459
– IIIA-152 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 91
8.3.3 Wulong Project
Wulong Project is composed of the Wulong Mine, and the Ligunzi gold deposit and the Haojingou-
Ligunzi deposit.
SRK was provided with geological exploration reports and maps, topography, database, QA/QC data
and SG data. The coordinate system of Wulong Mine and Ligunzi d eposit is Beijing 54 while
Haojingou-Ligunzi deposit is Xi’an 80. SRK undertook a thorough review for the database, followed
by various verification procedures, and verified that the datab ase was acceptable for a Mineral
Resource estimation.
Based on the data, SRK construc ted a Mineral Resource database,  composed of borehole collar,
survey, lithology, assay, and SG data. Table 8-3 summaries the database covering the entire project
area. The boundary of the estimation is the Wulong mining licence, and the Ligunzi and Haojingou-
Ligunzi exploration permits.
Table 8-3: Mineral Resource Database Statistics of Wulong Proje ct
Mine/Deposit Type Counts Length ((m)) Assay Samples
Wulong Mine
Drillholes 38 15,135.9 1,164
Tunnels 5,167 8,809.7 13,123
Total 5,205 23,945.6 14,287
Ligunzi Deposit
Drillholes 2 1,077.8 104
Tunnels 303 537.4 303
Trenches 3 2.0 3
Total 308 1,617.2 410
Haojingou-Ligunzi Deposit
Surface Drillholes 88 21,158.4 1,935
UG Drillholes 11 787.7 74
Tunnels 131 195.0 231
Trenches 279 169.2 452
Total 509 22,310.2 2,692
8.3.4 Hanfeng Project
Hanfeng Project consists of two mining rights, the Lishan Mine and the Dongfeng Mine. The Mineral
Resources are reported in the deep area of below -92m asl of fo r the Lishan Mine and in the deep
area of below 250m asl for Dongfeng Molybdenum Deposit.
The solid models were prepared using vein tool by Leapfrog 2021.1 and IDW estimation techniques
by GEOVIA Surpac 2020.1. The entire estimate procedure, consist ing of database compilation,
mineralised domains construction, the grade interpolation as well as the resources classification,
were completed by SRK.
The data SRK received from the client include collar, assay, survey, density and lithologies in excel
format, internal and external checks data, and geology maps. Detail information is as shown in Table
8-4, and the drillhole location is shown in Figure 8-1.
– IIIA-153 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 92
Table 8-4: Resource Database St atistics of Hanfeng Project
Mine Type Counts Profiles(m) Assay records
Lishan Drillholes 194 46,352 9,556
Tunnels 102 477 487
Dongfeng
Drillholes 252 88,402 31,949
Tunnels 63 431 417

Figure 8-1: Hole location of Lishan and Dongfeng Mines

Note: Lishan Mine on the left and Dongfeng Mine on the right
8.3.5 Jintai Project
SRK was provided with geological exploration reports and maps, topography, database, QAQC data,
and SG data. The coordinate system is CGCS2000. SRK undertook a thorough review for the
database, followed by various verification procedures, and verified that the database was acceptable
for a Mineral Resource estimation.
Based on the data, SRK construc ted a Mineral Resource database,  composed of borehole collar,
survey, lithology, assay, and SG data. Table 8-5 summaries the database covering the entire project
area.
Table 8-5: Mineral Resource Database Statistics for Jintai Proj ect
Mine/Deposit Type Counts Length ((m)) Assay Samples
Xidengping Mine
Drillholes 196 14,615.38 10,653
Trenches 12 105.30 102
Total 208 14,720.68 10,755
– IIIA-154 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 980 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 93
8.4 Solid Body Modelling
SRK was provided with section maps and mining level maps of all  mineralised domains. SRK has
constructed and reviewed the sold models according to the maps provided by the client and they are
acceptable for the estimation.
For the Jilong, Huatai and Wulong and Jintai projects, the mineralisation is dominated by gold. The
mineralised domains for the Jilong, Huatai and Wulong projects were interpreted by samples
collected based on a cut-off grade of 1.0g/t Au, and the mineralised domains for the Jintai Project
were interpreted by samples collected based on a cut-off grade of 0.17g/t Au.
For the Hanfeng Project, the zinc mineralised domains were interpreted by samples collected based
on a cut-off grade of 0.5% Zn, and the molybdenum mineralised domains were interpreted by
samples collected based on a cut-off grade of 0.03% Mo.
8.4.1 Jilong Project
A total of 44 mineralised domains for the #1#2#3&depth Block an d 4 mineralised domains for the
#4#5#6#7 Block were constructed in the Zhuanshanzi Mine (see Figure 8-2).
Figure 8-2: Mineralised Domains in the Zhuanshanzi Mine
Note: Solid bodies of #1#2#3&depth block on the left and #4#5#6#7 block on the right
8.4.2 Huatai Project
As shown in Figure 8-3, a total of 16 mineralised domains for t he Honghuagou Mine, 6 mineralised
domains for the Pengjiagou Mine and a total of 12 mineralised d omains for the Lianhuashan Mine
were constructed.
– IIIA-155 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 94
Figure 8-3: Mineralised Domains of Honghuagou, Pengjiagou and Lianhuashan Mines

Note: Solid bodies of Honghuagou Mine on the upper left, Pengjiagou Mine on the upper right and Lianhuashan Mine on the bottom.
8.4.3 Wulong Project
A total of 33 mineralised domains for the Wulong Mine, 6 mineralised domains for the Ligunzi deposit
and a total of 17 mineralised domains for the Haojingou-Ligunzi  deposit were constructed (Figure
8-4).
– IIIA-156 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 982 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 95
Figure 8-4: Mineralised Domains of Wulong Mine and Ligunzi and Haojingou-Ligunzi Deposits


Note: Solid bodies of Wulong Mine on the upper left, Ligunzi deposit on the upper right and Haojingou-Ligunzi deposit on the bottom.
8.4.4 Hanfeng Project
A total of 128 lead-zinc mineralised domains for the Lishan Mine (below-92m asl) and a total of 178
molybdenum mineralised domains the Dongfeng Mine were constructed (see Figure 8-5).
– IIIA-157 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 96
Figure 8-5: Mineralisation Domains of Lishan and Dongfeng Mines

Note: Solid bodies of Lishan Mine (below -92m asl) on the left and Dongfeng Mine (below 250m asl) on the right.
8.4.5 Jintai Project
A total of 11 mineralised domains were constructed in Xidengping Mine (see Figure 8-6).
Figure 8-6: Mineralised Domains of Xidengping Mine

Source: SRK
8.5 Compositing
8.5.1 Jilong Project
The database of the #1#2#3 depth block in the Zhuanshanzi Mine indicates that most of the sample
intervals are 0.4 m, and a 0.4 m interval composite length was selected for compositing. All raw
samples were composited to 0.4 m downhole lengths, with a minimum of 0.75 m for each composite
– IIIA-158 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 97
sample. A 0.4 m interval composite length was applied by SRK for subsequent statistic and grade
interpolation. The distribution of sample lengths is shown in Figure 8-7.
The database of the #4#5#6#7 block in the Zhuanshanzi Mine indi cates that most of the sample
intervals are 1.0 m, and a 1.0 m interval composite length was selected for compositing. A 1.0 m
interval composite length was applied by SRK for subsequent sta tistic and grade interpolation. The
distribution of sample lengths is shown in Figure 8-7.
Figure 8-7: Histograms of Sample Length of Zhuanshanzi Mine
Note: Histograms of sample length for the #1#2#3&depth block on the left and for #4#5#6#7 block on the right.
The calculated univariate statistics for gold within the #1#2#3 &depth block and #4#5#6#7 block of
Zhuanshanzi Mine are is presented In Table 8-6.
Table 8-6: Composites Statistics of Zhuanshanzi Mine
Mine/Deposit Samples Min Max Mean Median SD
#1#2#3&depth block, Zhuanshanzi Mine 2502 0.30 0.40 0.39 0.40 0.03
#4#5#6#7 block, Zhuanshanzi Mine 194 0.4 1 0.95 1 0.13
8.5.2 Huatai Project
The database of the #1 Mining Zone in the Honghuagou Mine indic ates that most of the sample
intervals are 0.8 m, and a 0.8 m interval composite length was selected for compositing. All raw
samples were composited to 0.8 m downhole lengths, with a minimum of 0.75 m for each composite
sample. A 0.8 m interval composite length was applied by SRK for subsequent statistic and grade
interpolation. The distribution of sample lengths of the #1 Mining Zone is shown in Figure 8-8.
For the #86 Vein of Honghuagou Mine, #26 Vein, #3&7# Vein and #5 Mining Zone of the Lianhuashan
Mine, and Pengjiagou Mine, a 0.5 m interval composite length was selected for compositing. All raw
samples were composited to 0.5 m downhole lengths, with a minimum of 0.75 m for each composite
sample. A 0.5 m interval composite length was applied by SRK for subsequent statistic and grade
interpolation.
– IIIA-159 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 98
Figure 8-8: Histogram of Sample Length of #1 Mining Zone of Honghuagou mine

The statistical results of the composited gold data from Huatai Project are presented in Table 8-7.
Table 8-7: Composites Statistics of Huatai project
Mine/Deposit Ore blo ck Samples Min Max Mean Median SD CoV.
Honghuagou #86 Vein 355 0.02 0.5 0.45 0.5 0.01 0.23
#1 Mining Zone 764 0.60 0.80 0.79 0.80 0.04 0.05
Lianhuashan
#3-7 Vein 821 0.01 0.5 0.40 0.47 0.03 0.47
#26 Vein 91 0.2 0.5 0.41 0.5 0.01 0.29
#5 Mining Zone 698 0.01 0.50 0.40 0.50 0.03 0.41
Pengjiagou Pengjiagou 323 0.01 0.50 0.45 0.50 0.01 0.27
8.5.3 Wulong Project
Prior to the statistical analysis, the samples were generally c ombined to the length of each sample
was basically equivalent. The basic statistics of geological sa mpling length of original samples are
carried out by SRK, as shown in Table 8-8.
Table 8-8: Statistics of Sam ple Length of Each Deposit
Mine/Deposit Samples Min Max Mean Median SD Kurtosis Skewness
Wulong 6,705  0.10  18.38  0.98  1.00  0.65  92.83  4.80
Ligunzi 268  0.30  3.10  1.83  2.00  0.70  -1.03  -0.17
Haojingou-Ligunzi 308  0.03  1.50  0.72  0.70  0.34  -0.43  0.2 6
The database of the Wulong Mine indicates that most of the samp le intervals are 1 m, and a 1 m
interval composite length was selected for compositing. All raw  samples were composited to 1 m
downhole lengths, with a minimum of 0.75 m for each composite s ample. A 1 m interval composite
length was applied by SRK for subsequent statistic and grade interpolation.
The database of the Ligunzi deposit indicates that most of the sample intervals are 2 m, and a 2 m
interval composite length was selected for compositing. All raw  samples were composited to 2 m
downhole lengths, with a minimum of 1.5 m for each composite sa mple. A 2 m interval composite
length was applied by SRK for subsequent statistic and grade interpolation.
– IIIA-160 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 986 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 99
The database of the Haojingou-Ligunzi deposit indicates that mo st of the sample intervals are 1 m,
and a 1 m interval composite length was selected for compositing. All raw samples were composited
to 1 m downhole lengths, with a minimum of 0.75 m for each comp osite sample. A 1 m interval
composite length was applied by SRK for subsequent statistic and grade interpolation.
The distributions of sample lengths of the Wulong Mine, and the  Ligunzi and Haojingou-Ligunzi
deposits are shown in Figure 8-9.
Figure 8-9: Histograms of Sample Length for Wulong Mine, Ligunz i and Haojingou-Ligunzi
Deposits



Note: Histograms of sample length for Wulong Mine on the upper left, Ligunzi deposit on the upper right and Haojingou-Ligunzi deposit
on the bottom.
Table 8-9 lists the summarised statistics of composites against  raw samples for each mine and
deposit. No material errors were found.
Table 8-9: Summary Statistic of Composites against Raws of Each Deposit
Deposit Type Counts Min Max Mean Variance SD Cov
Wulong
Raw 6705  0.00 172.00 8.36 92.25 9.60 1.15
Composite 6674 0.00 172.00 9.01 86.45 9.30 1.03
Difference (%) -0.46  0.00  0.00  7. 67  -6.29  -3.20  -10.09
Ligunzi
Raw 268  0.30 41.00 5.34 18.56 4.31 0.81
Composite 233  0.30 41.00 5.46 18.22 4.27 0.78
Difference (%) -13.06  0.00  0.00  2. 22  -1.85  -0.90  -3.05
Haojingou-Ligunzi Raw 308 0.05 107.00 6.25 96.93 9.85 1.57
– IIIA-161 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 100
Deposit Type Counts Min Max Mean Variance SD Cov
Composite 254 0.05 46.75 6.52 54.93 7.41 1.14
Difference (%) -17.53  0.00  -56.30 4.29  -43.33  -24.74 -27.83
8.5.4 Hanfeng Project
The compositing interval was selected by reviewing sample length histograms. A mineralised sample
length histogram from the Lishan Mine (below-92m asl) and Dongf eng Mine (below 250m asl) are
displayed in Figure 8-10.
A composite length of 1 m was chosen for both Lishan and Dongfeng Mine as it does not distort the
grade distribution for the mine when compared to the length-weighted raw grade statistics.
Figure 8-10: Histogram of Sample Length for Lishan and Dongfeng Mines

Note: Histograms of sample length for Lishan Mine (below -92m asl) on the left and Dongfeng Mine (below 250m asl) on the right.
The statistical results of the composited Zn, Pb and Cu data fr om the Lishan Mine is presented in
Table 8-10, and the statistical results of the composited Mo da ta from the Dongfeng Mine is
presented in Table 8-11.
Table 8-10: Composites Statistics of Lishan Mine (below-92m asl)
Item Cu Composites Pb Composites Zn Composites
Number of samples 1,818 1,818 1,818
Minimum value 0 0 0.001
Maximum value 6.41 9.04 43.73
Mean 0.056 0.13 2.47
Variance 0.12 0.33 8.78
Standard Deviation 0.34 0.58 2.96
Coefficient of variation 6.18 4.30 1.20
Table 8-11: Composites Statistics of Dongfeng Mine (below 250m asl)
Item Mo Composites
Number of samples 8,988
Minimum value 0.001
– IIIA-162 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 101
Item Mo Composites
Maximum value 5.265
Mean 0.11
Variance 0.04
Standard Deviation 0.19
Coefficient of variation 1.69
8.5.5 Jintai Project
Prior to the statistical analysis, the samples were generally c ombined to the length of each sample
was basically equivalent. The basic statistics of geological sa mpling length of original samples are
carried out by SRK, as shown in Table 8-12.
Table 8-12: Statistics of Sampl e Length of Xidengping Mine
Mineralised Domain Samples Min Max Mean Median SD Kurtosis Skew ness
V1 215 0.57  1.65 1.01  1 .00  0.12  9.90  1.55
V2 79 0.67  1.42 1.02  1. 00  0.14  2.15  1.14
V2_1 6 1.00  1.50 1.19  1 .15  0.22  -1.83  0.45
V2_2 18 0.80  1.50 1.14  1 .00  0.24  -1.18  0.66
V4 1,145 0.20  1.50 0.99  1 .00  0.19  1.46  -0.80
V5 47 0.60  1.38 0.99  1. 00  0.16  0.57  -0.41
V6 3 1.00  1.00 1.00  1.00  0.00  / /
V7 79 0.51  1.38 1.00  1. 00  0.16  1.66  -0.70
V8 122 0.40  2.70 1.01  1 .00  0.29  8.73  1.47
V9 30 0.38  1.49 1.03  1. 01  0.21  2.21  -0.61
V10 42 0.64  1.55 1.03  1 .01  0.18  0.99  0.00
Total 1,786  0.20  2.70 1.00  1.00  0.19  5.10  -0.11
As shown in Figure 8-11, the result indicates that most of the sample intervals at the Xindengping
Mine are 1 m, and a 1 m interval composite length was selected for compositing. All raw samples
were composited to 1 m downhole lengths, with a minimum of 0.75 m for each composite sample. A
1 m interval composite length was applied by SRK for subsequent statistic and grade interpolation.
The statistical results of the composited gold data from Jintai Project are presented in Table 8-13.
– IIIA-163 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 102
Figure 8-11: Histogram of the Sample Length of Xidengping Mine
Table 8-13: Summary Statistic of Composites against Raws of Each Domain
Type Item V1 V2 V2_1 V2_2 V4 V5 V6 V7 V8 V9 V10
Composite
Counts 215 75 7 19 1,120 45 3 74 124 28 41
Min 0.09 0.12 0.30 0.09 0.06 0.14 0.44 0.18 0.07 0.14 0.18
Max 4.40 21.40 0.41 0.90 107.48 5.19 1.20 37.67 4.99 4.66 20.88
Mean 0.78 1.65 0.34 0.41 1.72 0.83 0.84 0.93 0.83 1.45 2.90
Variance 0.41 12.31 0.00 0.04 16.17 0.96 0.15 18.80 0.61 1.52 2 5.02
SD 0.64 3.51 0.04 0.20 4.02 0.98 0.38 4.34 0.78 1.23 5.00
Cov 0.83 2.12 0.11 0.50 2.34 1.19 0.45 4.67 0.94 0.85 1.73
Raw
Counts 215 79 6 18 1,145 47 3 79 122 30 42
Min 0.09 0.10 0.30 0.06 0.06 0.07 0.44 0.09 0.06 0.06 0.11
Max 4.43 21.40 0.45 1.04 113.00 5.19 1.20 47.00 4.99 6.13 25.00
Mean 0.78 1.59 0.34 0.41 1.71 0.82 0.84 1.01 0.79 1.36 2.86
Variance 0.42 12.98 0.00 0.05 17.37 1.08 0.15 27.52 0.59 2.00 3 3.36
SD 0.65 3.60 0.05 0.23 4.17 1.04 0.38 5.25 0.77 1.42 5.78
Cov 0.84 2.26 0.16 0.56 2.43 1.26 0.45 5.18 0.97 1.04 2.02
Au Mean Difference (%) -0.23 3.66 -1.24 0.11 0.26 0.30 0.00 -8. 20 5.30 6.55 1.27
8.6 Evaluation of Outliers
Top cut analysis is undertaken to assess the influence extreme grade outliers have on the sample
population of each data type. Although the extreme grades are r eal, these outliers are not
representative of the domain assay population and so may overstate the block grades in some parts
of the deposit if left uncut.
– IIIA-164 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 103
8.6.1 Jilong Project
In order to avoid any disproportionate influence of random, ano malously high-grade assays on the
resource average grade, assay capping for gold was applied for the #1#2#3&depth block of
Zhuanshanzi Mine. The histogram and cumulative probability plot are presented in Figure 8-12 and
the capping values of the #1#2#3&depth block are listed in Table 8-14.
Figure 8-12: Cumulative Probabilit y Plot and Histogram for the #1#2#3&depth Blocks
Table 8-14: Capping Values Statis tics of #1#2#3&depth Block of Zhuanshanzi Mine
Mine\Deposit Assay
Cap
Number of
Replaced Samples
Capped
Ratio (%)
Mean
Before Capping After
Capping
Zhuanshanzi Mine
(#1#2#3&depth
block)
52 74 1.71% 9.31 9.07

SRK have conducted corresponding statistical analysis for the gold composited data of the 4#5#6#7#
Block of Zhuanshanzi Mine. The grade variation coefficient of the gold mineralised body in the mining
area is between 39.35-65.90%, which is less than 100%. Capping grade should be 82.62g/t, which
is six times of the average grade (13.77g/t) and larger than th e highest grade (45.03g/t). Since all
the sample grades are lower than the capping grade, no capping was applied.
8.6.2 Huatai Project
In order to avoid any disproportionate influence of random, ano malously high-grade assays on the
resource average grade, assay capping for gold was applied for the Huatai Project. The cumulative-
probability plots and the capping values for the #1 Mining Zone and #26 Vein are presented in Figure
8-13 and Table 8-15.
– IIIA-165 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 104
Figure 8-13: Cumulative Probability Plots for #1 Mining Zone and #26 Vein

Note: 5 plots of KT2100, KT1420, KT3000, KT3100 and KT2300 from #1 Mining Zone and the last plot on bottom right from #26 Vein.
Table 8-15: Capping Values St atistics of Huatai Project
Mine\Deposit Assay
Cap
Number of
Replaced
Samples
Capped Ratio
(%)
Mean
Before
Capping
After
Capping
Honghuagou #1 Mining Zone kt2100 15.26 4 0.11 10.41 6.86
Honghuagou #1 Mining Zone kt1420 15.96 7 0.06 7.92 6.94
Honghuagou #1 Mining Zone kt3000 25.00 4 0.08 10.61 9.89
Honghuagou #1 Mining Zone kt3100 8.30 6 0.04 6.04 5.41
Honghuagou #1 Mining Zone kt2340 17.13 5 0.10 8.93 8.35
Lianhuashan #26 Vein 19.54 2 0.04 8.29 8.16
– IIIA-166 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 105
8.6.3 Wulong Project
The composite grade distributions of each deposit were examined  via histograms and cumulative
probability plots to determine if capping was required and if so at what level. Figure 8-14, Figure 8-15
and Figure 8-16 show the histogram and cumulative probability curve of the composite gold for each
mine and deposit.
Figure 8-14: Au Histogram and Cumulative Probability Curve of Wulong Mine
Figure 8-15: Au Histogram and Cumulative Probability Curve of Ligunzi Deposit

Figure 8-16: Au Histogram and Cumulative Probability Curve of Haojingou-Ligunzi Deposit

The composite samples statistics are listed in Table 8-9 and ar e shown in figures from Figure 8-14
to Figure 8-16, indicating that grades are defined as outlier v alue samples. Table 8-16 contains the
outlier value details.
– IIIA-167 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 993 ---
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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 106
Table 8-16: Capping Values Stat istics of Wulong Project
Mine/Deposit
Assay
Cap  Number of
Replaced
Samples
Capped
Ratio (%)
Au Mean (g/t) Difference
(%) Au (g/t) Before
Capping
After
Capping
Wulong 54 29 0.43 9.01 8.88 -1.44
Ligunzi 15 8 5.15 5.46 5.26 -3.66
Haojingou-
Ligunzi 28 5 1.97 6.52 6.32 -3.07
8.6.4 Hanfeng Project
In order to avoid any disproportionate influence of random, anomalously high-grade assays on the
resource average grade, Assay capping for Pb, Zn and Cu was applied for the mineralised domains
of Lishan Mine and Assay capping for Mo for Dongfeng Mine. The cumulative-probability plots and
Capping Values of Lishan and Dongfeng are presented in Figure 8-17 and Table 8-17.
Figure 8-17: Cumulative-probability plots for Lishan and Dongfeng Mines
Note: Lishan Mine (below -92m asl) on the top and bottom left and Dongfeng Mine (below 250m asl) on the bottom right.
– IIIA-168 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 994 ---
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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 107
Table 8-17:  Outliers Treatment of Hanfeng Project
Mine Element Assay Cap
Number of
Replaced
Samples
Capped
Ratio
(%)
Mean
Before
Capping
After
Capping

Lishan
Zn（%） 20.69 4 0.22 2.47 2.45
Pb （%） 4.60 7 0.39 0.13 0.12
Cu （%） 1.35 19 1.05 0.05 0.04
Dongfeng Mo （%） 2.28 4 0.04 0.11 0.11
8.6.5 Jintai Project
The composite grade distributions of each domain were examined via histograms and cumulative
probability plots to determine if capping was required and if so at what level. Figure 8-18 below show
the histograms and cumulative probability curves of the composites Au for the domains V1, V2, V2_1,
V2_2, V4, V5, V7, V8, V9 and V10, respectively.
Figure 8-18: Histograms and Cumulative Probability Curves of Gold Mineralised Domains

– IIIA-169 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 108


– IIIA-170 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 109
– IIIA-171 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 110
The composite samples statistics are listed in Table 8-13 and a re shown in Figure 8-18 indicating
that grades are defined as outlier value samples. Table 8-18 contains the outlier value details.
Table 8-18: Capping Values Stat istics of Xidengping Mine
Doma
in
Assay
Cap Number of Replaced
Samples
Capped
Ratio (%)
Au Mean (g/t) Difference
(%) Au (g/t) Before
Capping
After
Capping
V2 10 3 4.00 1.65 1.40 -15.15
V4 11 10 0.89 1.72 1.55 -9.82
V7 2 1 1.35 0.93 0.45 -51.56
V10 11 3 7.32 2.90 2.37 -18.16
8.7 Block Model and Grade Estimation
8.7.1 Jilong Project
For the #1#2#3&depth Block of Zhuanshanzi Mine, a block size of 4 m easting by 4 m northing by 4
m elevation was used. The block model used the same coordinate system as that was used in data
collection. A summary of the block model specifications is listed in Table 8-19.
Table 8-19: Block Model Specificat ions of #1#2#3&depth Block of Zhuanshanzi Mine
Deposit Coords Min Max Block
Size
Sub Block
Size Rotation
Zhuanshanzi Mine
(#1#2#3&depth block)
N 4684100 4687252 4 1 0
E 466100 468500 4 1 0
Z -400 652 4 1 0
The Inverse Distance Weighting (“ IDW”) method was used for grade estimation via Surpac in the
block model. The parameters of t he searching ellipsoid were thu s manually optimized, and the
parameters are summarized in Table 8-20 and Table 8-21.  Accord ing to the general dipping trend,
different dip angles were adopted. The domain, category, SG and depletion attributes were assigned
directly using the solid models.
Table 8-20: Search Parameters Used in #1#2#3&depth Block of Zhuanshanzi Mine
Domain major/semi-
major
major/
minor Azimuth Plunge Dip
KT540, KT2714, KT2851, KT10800 1.2 4 130 0 80
KT2821, KT2820, KT2830, KT7220 1.2 4 120 0 70
KT5730, KT5720, KT5710, KT2702, KT2701,
KT512, KT521, KT530, KT2710, KT2720 1.2 4 130 0 -80
KT2810, KT2812, KT2814 1.2 4 130 0 -50
KT2501, KT2502 1.2 4 150 0 -90
KT930 1.2 4 100 0 90
KT1100 1.2 4 133 0 80
KT1110 1.2 4 96 0 90
KT1212 1.2 4 140 0 40
KT2510 1.2 4 160 0 -90
– IIIA-172 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 998 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 111
Domain major/semi-
major
major/
minor Azimuth Plunge Dip
KT2840 1.2 4 140 0 50
KT2860 1.2 4 160 0 50
KT5220 1.2 4 150 0 70
KT7230, KT7250 1.2 4 140 0 -80
KT7251 1.2 4 140 0 -90
KT10490, KT10481, KT10482 1.2 4 174 0 70
KT10410 1.2 4 160 0 -60
KT10400 1.2 4 170 0 -50
KT1044 1.2 4 110 0 -90
KT2604, KT2703, KT2704, KT10010 1.2 4 140 0 10
Table 8-21: Search distance and Samples Used in #1#2#3&depth Bl ock of Zhuanshanzi Mine
Pass Max Radius(m) Min samples Max samples
1 40 5 45
2 80 3 45
3 160 1 45
For the #4#5#6#7 Block of Zhuanshanzi Mine, 4 block models were created, with size of 4 m easting
by 4 m northing by 4 m elevation. The block models used the sam e coordinate system as that was
used in data collection. A summary of the block model specifications is listed in Table 8-22.
Table 8-22: Block Model Specifi cations of #4#5#6#7 Block of Zhuanshanzi Mine
Block Coords Min Max Block Si ze Sub Block Size Rotation
#4
N 4689340 4689900 4 0.5 60
E 466400 466892 4 0.5 0
Z 500 900 4 0.5 0
#5
N 4684400 4685100 4 0.5 30
E 468300 469200 4 0.5 0
Z 300 900 4 0.5 0
#6
N 4681770 4682202 4 0.5 30
E 467300 467920 4 0.5 0
Z 200 900 4 0.5 0
#7
N 4680640 4681232 4 0.5 30
E 469800 470600 4 0.5 0
Z 200 900 4 0.5 0
The IDW method was used for grade estimation via Surpac in the block models. The parameters of
the searching ellipsoid were thus manually optimized, and the parameters are summarized in Table
8-23. According to the general dipping trend, different parameters were adopted for each model. The
domain, category and SG attribute were assigned directly using the solid models.
Table 8-23: Distance and Sampl es Used in #4#5#6#7 Block of Zhuanshanzi Mine
– IIIA-173 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 999 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 112
Block Pass Search
Distance
Min num of
Samples
Max num of
Samples Bearing Plunge Dip Major/Semi-
major Major/Minor
#
1 40 13 45 150 0 60 1.2 4
2 80 7 45 150 0 60 1.2 4
3 160 3 45 150 0 60 1.2 4
#5
1 50 13 45 125 0 80 1.2 4
2 80 7 45 125 0 80 1.2 4
3 160 3 45 125 0 80 1.2 4
#6
1 40 13 45 120 0 -75 1.2 4
2 80 7 45 120 0 -75 1.2 4
3 160 3 45 120 0 -75 1.2 4
#7
1 50 13 45 120 0 -75 1.2 4
2 80 7 45 120 0 -75 1.2 4
3 160 3 45 120 0 -75 1.2 4
8.7.2 Huatai Project
For the #1 Mining Zone, a block size of 4 m easting by 4 m northing by 4 m elevation was used. For
the #86 Vein, #26 Vein, #3&#7 Vein, #5 Mining Zone, and Pengjia gou Mine, a block size of 2 m
easting by 2 m northing by 2 m elevation was used. The block mo del used the same coordinate
system as that was used in data collection. A summary of the bl ock model specifications is listed in
Table 8-24.
Table 8-24: Block Model Specifi cations of Huatai Project
Deposit Coords Min Max Block Size Sub Block Size Rotation
Honghuagou #1 Mining
Zone
N 4674000 4676980 4 1 0
E 386050 389102 4 1 0
Z -400 800 4 1 0
Honghuagou #86 Vein
N 4676200 4677000 2 1 0
E 383550 385160 2 1 0
Z 250 810 2 1 0
Lianhuashan #3-7 Vein
N 4682360 4683220 2 1 0
E 376450 377310 2 1 0
Z 210 980 2 1 0
Lianhuashan #26 Vein
N 4682200 4682770 2 1 0
E 375620 375840 2 1 0
Z 660 880 2 1 0
Lianhuashan #5 Mining
Zone
N 4680300 4681800 2 1 0
E 375290 376190 2 1 0
Z -200 730 2 1 0
Pengjiagou
N 4674800 4678140 2 1 0
E 388730 389840 2 1 0
Z 120 880 2 1 0
The IDW method was used for grade estimation via Surpac in the block model. The parameters of
the searching ellipsoid were thus manually optimized, and the parameters are summarized in Table
8-25 and Table 8-26. According to the general dipping trend, di fferent dip angle was adopted. The
domain, category, SG and depletion attribute were assigned directly using the solid models.
– IIIA-174 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1000 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 113
Table 8-25: Parameters Used i n #1 and #5 Mining Zones, #86, #3&#7, #26 Veins, Pengjiagou
Domain major/semi-major major/minor Azimuth Plunge Dip
Honghuagou #1 Mining Zone
kt_1420 2.5 10 170 0 65
kt_1501 2.5 10 170 0 -75
kt_1502 2.5 10 170 -60 85
kt_2100 2.5 10 170 0 60
kt_2340 2.5 10 170 0 75
kt_2350 2.5 10 170 0 75
kt_2801 2.5 10 170 0 70
kt_2802 2.5 10 170 0 70
kt_3000 2.5 10 170 0 -70
kt_3100 2.5 10 170 0 -75
kt_8210 2.5 10 170 0 70
Honghuagou #86 Vein 2.5 10 160 0 70
Lianhuashan #3&#7 Vein 2.5 10 160 0 70
Lianhuashan #26 Vein 2.5 10 175 0 -65
Lianhuashan #5 Mining Zone 2.5 10 180 0 -70
Pengjiagou 2.5 10 160 0 70
Table 8-26: Distance and Samp les Used in Huatai project
Pass Max Radius (m) Min samples Max samples
1 40 5 45
2 80 3 45
3 160 1 45
8.7.3 Wulong Project
For the Wulong Mine, a block size of 4 m easting by 4 m northin g by 4 m elevation was used. The
block model used the same coordinate system as that was used in data collection. A summary of the
block model specifications is listed in Table 8-27. The attribu tes and descriptions are presented in
Table 8-28.
Table 8-27: Block Model Speci fications of Wulong Mine
Deposit Coords Min Max Block Size Sub Block Size Rotation
Wulong
N 4445900 4448400 4 1 0
E 47200 475600 4 1 0
Z -800 200 4 1 0
Table 8-28: Attributes and De scriptions of Wulong Mine
Attribute Description
domain
V2-3, V4-1, V4-2, V4-4, V4-5, V6, V6-1, V6-2, V7, V9, V9-1, V10, V32, V32-1, V33,
V40, V42, V65, V68, V76, V76-1, V80, V80-5, V100, V107, V109, V162, V163,
V163-1, V163-3, V164, V500, V500-1
au_gpt_capped Gold grade, capped
category 1=Mea, 2=Ind, 3=Inf
sg Specific gravity
depletion 0=unmined, 1=mined
– IIIA-175 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1001 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 114
The Inverse Distance Weighting Square (“IDW2”) method was used for grade estimation via Surpac
in the block model. The parameters of the searching ellipsoid were thus manually optimized, and the
parameters are summarised in Table 8-29 and Table 8-30.  Accord ing to the general dipping trend,
different dip angles were adopted. The domain, category, SG and depletion attribute were assigned
directly using the solid models.
Table 8-29: Search Parameters Used in Wulong Mine
Domain Bearing Plunge Dip major/semi-major major/minor
V2-3 10 0 -80 1 5
V4-1 0 0 70 1 5
V4-2, V4-4 10 0 -75 1 5
V4-5 350 0 60 1 5
V6, V6-1, V6-2 300 0 80 1 5
V7 320 0 80 1 5
V9, V9-1 10 0 -80 1 5
V10, V32, V32-1, V33, V40, V42 10 0 -75 1 5
V65 10 0 80 1 5
V68 350 0 60 1 5
V76 300 0 50 2 5
V76-1 300 0 70 2 5
V80 10 0 -80 2 5
V80-5 310 0 -70 1.3 5
V100 10 0 -70 1 5
V107 10 0 75 1.5 5
V109 350 0 75 2 5
V162 320 0 50 1 5
V163 320 0 70 1 5
V163-1 345 0 80 1 5
V163-3, V164 310 0 65 1 5
V500 10 0 -70 1.2 5
V500-1 10 0 50 1 5
Table 8-30: Distance and Sa mples Used in Wulong Mine
Domain Pass
Search
Distance
(m)
Min
Samples
Max
Samples
V4-1, V4-2, V6-1, V7, V9, V10, V33, V40, V76-1, V100,
V109, V164 1 45 3 15
V2-3, V4-4, V4-5, V6, V6-2, V9-1, V32, V32-1, V42, V65,
V68, V76, V80, V80-5, V107, V162, V163, V163-1,
V163-3, V500
1 45 3 15
2 90 1 15
V500-1
1 45 3 15
2 90 3 15
3 180 1 15
For the Ligunzi deposit, a block size of 4 m easting by 4 m northing by 4 m elevation was used. The
block model used the same coordinate system as that was used in data collection. A summary of the
block model specifications is listed in Table 8-31. The attribu tes and descriptions are presented in
Table 8-32.
Table 8-31: Block Model Specifi cations of Ligunzi Deposit
– IIIA-176 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1002 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 115
Deposit Coords Min Max Block Size Sub Block Size Rotation
Ligunzi
N 4445400 4446600 4 1 0
E 473700 474900 4 1 0
Z -600 400 4 1 0
Table 8-32: Attributes and Desc riptions of Ligunzi Deposit
Attribute Description
domain V10_3, V4_6, V82, V83, V84, V85
au_gpt_capped Gold grade, capped
category 1=Mea, 2=Ind, 3=Inf
sg Specific gravity, 0=air
partial percent Partial percent
boundary 0=Outside licence, 1=Inside licence
The IDW2 method was used for grade estimation via Surpac in the block m odel. The parameters of
the searching ellipsoid were thus manually optimized, and the parameters are summarized in Table
8-33 and Table 8-34. According to the general dipping trend, different dip angles were adopted. The
Domain, Category, SG and Boundary attribute were assigned directly using solid models.
Table 8-33: Search Parameters Used in Ligunzi Deposit
Domain Bearing Plunge Dip major/semi-major major/minor
V10-3 0 0 -77 1.6 10
V4-6 2 0 80 1.5 10
V82 350 0 -78 1.75 10
V83 350 0 -78 2.4 10
V84 330 0 52 1 10
V85 11 0 40 1 10
Table 8-34: Distance and Samp les Used in Ligunzi Deposit
Domain Pass
Search
distance
(m)
Min
Samples
Max
Samples
Max
Samples of
per Hole
Others 1 40 6 25 3
2 80 3 25 3
V85
1 80 6 25 3
2 160 3 25 3
3 200 1 25 3
V84 1 40 1 25 3
For the Haojingou-Ligunzi deposit, a block size of 4 m easting by 4 m northing by 4 m elevation was
used. The block model used the same coordinate system as that w as used in data collection. A
summary of the block model specifications is listed in Table 8-35. The attributes and descriptions are
presented in Table 8-36.
Table 8-35: Block Model Specificat ions of Haojingou-Ligunzi Deposit
Deposit Coords Min Max Block Size Sub Block Size Rotation
Haojingou-Ligunzi N 4445600 4449100 4 1 0
E 41600900 41604500 4 1 0
– IIIA-177 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1003 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 116
Deposit Coords Min Max Block Size Sub Block Size Rotation
Z -350 502 4 1 0
Table 8-36: Attributes and Descri ptions of Haojingou-Ligunzi Deposit
Attribute Description
domain v225,v230,v231,v232,v255,v497,v500_2,v547,v549,v550,v551,v551_1,v702,v703,v70
3_2,v711_2,v711_3
au_gpt_capped Gold grade, capped
category 1=Mea, 2=Ind, 3=Inf
sg Specific gravity, 0=air
partial percent Partial percent
boundary 0=Outside licence, 1=Inside licence
The IDW2 method was used for grade estimation via Surpac in the block m odel. The parameters of
the searching ellipsoid were thus manually optimized, and the parameters are summarized in Table
8-37 and Table 8-38.  According to the general dipping trend, different dip angles were adopted. The
domain, category, SG and boundary attribute were assigned directly using the solid models.
Table 8-37: Search Parameters Used in Haojingou-Ligunzi Deposit
Domain Bearing Plunge Dip major/semi-
major major/minor
V225 330 0 70 1 5
V230, V231, V232, V497 20 0 -60 2 5
V255 0 0 80 1 5
V500_2 8 0 75 3 5
V547, V549, V550, V551,
V551_1 25 0 50 1 5
V702, V703_2, V711_2 10 0 -70 1 5
 V711_3 10 0 70 1 5
V703 35 0 70 1 5
Table 8-38: Distance and Sampl es Used in Haojingou-Ligunzi Deposit
Domain Pass Search
distance (m) Min Samples Max Samples
V225, V230, V497, V255, V547,
V550, V551, V551_1, V702,
V703_2, V711_2, V711_3, V703
1 45 3 15
2 90 1 15
V231, V232, V500_2, V549
1 45 3 15
2 90 3 15
3 180 1 25
8.7.4 Hanfeng Project
SRK generated the non-rotational model for Lishan Mine (below-9 2m asl) and Dongfeng
Molybdenum Mine (below 250m asl) by Surpac software for grade and tonnage estimation.  Suitable
block interval and unit size was adopted to build a block model  which was able to contain the
mineralised zones. The block model used the same coordinate system as data collection. The block
model summary of Lishan and Dongfeng mines are presented in Table 8-39.
– IIIA-178 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1004 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 117
Table 8-39: Block Model Parameters for Lishan and Dongfeng Mines
Mine Coords Min Max Block Size Sub Block Size Rotation
Lishan
N 4756770 4757350 20 10 0
E 43495640 43496460 20 10 0
Z -620 0 2 1 0
Dongfeng
N 4757100 4758800 20 5 0
E 500000 501100 20 5 0
Z -500 760 20 5 0
The IDW method was applied for grade estimation in the minerali sed domains for Lishan and
Dongfeng Mine.The three progressively more relaxed search crite ria used are presented in Table
8-40. For a small local un-estimated area, interpolation was pe rformed with a larger search radius.
Three different search ellipsoids (see Table 8-41 and Table 8-4 2) were aligned with the different
mineralisation orientations for both Lishan and Dongfeng mines.
Table 8-40:  Specific Search Par ameters for Hanfeng Project
Mine Pass Search
Distance
Minimum of
Samples Maximum of Samples
Lishan
1 40 3 15
2 80 3 15
3 160 3 15
Dongfeng
1 50 3 15
2 100 3 15
3 200 3 15
Table 8-41: Ellipsoid Parameters for Lishan Mine (below-92m asl)
Domain Bearing Plunge Dip major/semi-major major/minor
X1-X5 series, X31-36 series 56 10 70 1 3
X6-10 series 76 60 -70 2 5
X11-X23 series, X37-43 series 93 37 -58 1.2 6
Table 8-42: Ellipsoid Parameters for Dongfeng Mine (below 250m asl)
Domain Bearing Plunge Dip major/semi-major major/minor
DM series 0 16 67 2 5
D series 17 40 73 2 5
H series 163 -13 -19 2 5
8.7.5 Jintai Project
The block model of Xidengping Mine was created using Surpac, and it was used to estimate tonnage
and grade. Appropriate block cell size was selected for the deposits.
A block size of 10 m easting by 10 m northing by 5 m elevation was used. The block model used the
same coordinate system as that was used in data collection. A s ummary of the block model
specifications is listed in Table 8-43. The attributes and descriptions are presented in Table 8-44.
– IIIA-179 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1005 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 118
Table 8-43: Block Model Specifi cations of Xidengping Mine
Deposit Coords Min Max Block Size Sub Block Size Rotation
Xidengping
N 2875400 2879000 10 2.5 0
E 578500 581600 10 2.5 0
Z 1900 2200 5 1.25 0
Table 8-44: Attributes and Desc riptions of Xidengping Mine
Attribute Description
domain V1, V2, V2_1, V2_2,V4,V5,V6,V7,V8,V9,V10
au_gpt_capped Gold grade, capped
classification 1=Mea, 2=Ind, 3=Inf
sg Specific gravity, 0=air
partial percent Partial percent
depletion 1=after depletion, 0=air
The IDW2 method was used for grade estimation via Surpac in the block m odel. The parameters of
the searching ellipsoid were thus manually optimized, and the parameters are summarized in Table
8-45 and Table 8-46.  According to the general dipping trend, different dip angles were adopted. The
domain, classification, SG and depletion attribute were assigned directly using the solid models.
Table 8-45: Search Parameters Used in Xidengping Mine
Domain Bearing Plunge Dip major/semi-major major/minor
V1 335 0 8 1 10
V2 335 0 8 1.6 10
V2_1 335 0 4 1.6 10
V2_2 335 0 10 1 10
V4 335 0 6 1 10
V5 335 0 0 1.3 10
V6 335 0 0 1.4 10
V7 335 0 0 1.1 10
V8 335 0 50 3 7
V9 300 0 3 1 10
V10 335 0 0 1 10
Table 8-46: Distance and Samp les Used in Xidengping Mine
Domain Pass
Search
distance
(m)
Min
Samples
Max
Samples
Max
Samples of
per Hole
V1, V2, V2_1, V2_2
1 80 3 15 2
2 160 3 15 2
3 160 1 15 2
V4, V5, V7
1 40 3 15 2
2 80 3 15 2
3 160 1 10 2
V6 1 80 1 15 2
V8
1 40 3 15 2
2 40 1 15 2
3 80 1 15 2
V9 1 80 3 15 2
2 80 1 15 2
– IIIA-180 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mineral Resource Estimates    Final
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3 160 1 15 2
V10
1 80 3 15 2
2 160 3 15 2
3 160 1 15 2
8.8 Model Validation and Sensitivity
Model validation is a common approach for determining whether grade estimation has performed as
expected. SRK has undertaken a through validation of the result ant interpolated model, including
visual inspection, and swath plot validation as well.
Visual inspection provides a validation of the interpolated blo ck model on a local block scale, using
visual assessments of sample grades versus estimated block grades.
8.8.1 Jilong Project
The details of swath plot validation for each domain can be seen in Figure 8-19 to Figure 8-22. There
is no swath plot for #4 block because there are too few samples  for a valid swath plot. These data
indicate that the block models constructed by SRK are reliable.
Figure 8-19: Au Swath Plot of #1 #2#3&depth Block of Zhuanshanzi Mine


– IIIA-181 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1007 ---
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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 120
Figure 8-20: Au Swath Plot of #5 block of Zhuanshanzi Mine

Figure 8-21: Au Swath Plot of #6 block of Zhuanshanzi Mine

– IIIA-182 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
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Mineral Resource Estimates    Final
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Figure 8-22: Au Swath Plot of #7 block of Zhuanshanzi Mine

8.8.2 Huatai Project
For the #1  Mining Zone and #86 Vein, the details of swath plots validation  can be seen in Figure
8-23, for the #26 Vein and #3&#7 Vein, the details of swath plo ts validation can be seen in Figure
8-24 and for the #5 Mining Zone and Pengjiagou Mine, the detail s of swath plots validation can be
seen in Figure 8-25. These data indicate that the block models constructed by SRK are reliable.
Figure 8-23: Au Swath Plots of #1 Mining Zone and #86 Vein
– IIIA-183 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1009 ---
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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 122
Note: #1 Mining Zone on the left and #86 Vein on the right.
Figure 8-24: Au Swath Plots of #26 Vein and #3&#7 Vein
Note: #26 Vein on the left and #3&#7 Vein on the right.
– IIIA-184 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mineral Resource Estimates    Final
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Figure 8-25: Au Swath Plots of #5 Mining Zone and Pengjiagou Mine

Note: #5 Mining Zone on the left and Pengjiagou Mine on the right.
8.8.3 Wulong Project
For the Wulong Mine, the details of swath plot validation for each domain can be seen in figures from
Figure 8-26 and for the Ligunzi and Haojingou-Ligunzi deposits, the details of swath plots validation
can be seen in Figure 8-27. Thes e data indicate that the block models constructed by SRK are
reliable.
Figure 8-26: Au Swath Plot of Wulong Mine

– IIIA-185 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mineral Resource Estimates    Final
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Figure 8-27: Au Swath Plots of Ligunzi and Haojingou-Ligunzi Deposits


Note: Ligunzi deposit on the left and Haojingou-Ligunzi deposit on the right.
– IIIA-186 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mineral Resource Estimates    Final
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8.8.4 Hanfeng Project
Swath plots of Zn grade were created in three orthogonal direct ions for Lishan and Mo grade for
Dongfeng Mine (easting, northing, and vertical, as X, Y, and Z) in particular slice thicknesses in each
direction to validate the resu ltant block models. As shown in F igure 8-28, the block models and
composites match reasonably well in all orthogonal directions. This comparison shows close
agreement between the block model and composites in terms of overall distribution as a function of
X, Y, and Z location.
Figure 8-28: Zn Swath Plot of Lishan Mine and Mo Swath Plot for Dongfeng Mine

Note: Lishan Mine on the left and Dongfeng Mine on the right.
– IIIA-187 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1013 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mineral Resource Estimates    Final
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8.8.5 Jintai Project
The details of swath plot validation of the Xindengping Mine ca n be seen in Figure 8-29. The data
indicate that the block models constructed by SRK are reliable.
Figure 8-29: Au Swath Plot of Xidengping Mine


8.9 Mineral Resource Classification
Block model quantities and grade estimates for the Jilong, Huat ai, Wulong, Hanfeng and Jintai
projects were classified according to the JORC Code by Mr. Mingyan Wang, Mr. Huaixiang (Hubert)
Li, Ms. Yanfang (Bonnie) Zhao and Mr. Shaobo Dai, under the sup ervision of Yiefei Jia, PhD, a
Principal Consultant and a Fellow of the AusIMM (No. 230607) an d a chartered professional in
geology (CP Geo). They are appropriate Competent Persons for the purpose of JORC Code.
Mineral Resource classification is typically a subjective concept. Industry best practices suggest that
Mineral Resource classification should consider both the confid ence in the geological continuity of
the mineralised structures, the quality and quantity of exploration data supporting the estimates, and
the geostatistical confidence in the tonnage and grade estimate s. Appropriate classification criteria
should aim at integrating these concepts to delineate regular a reas at similar Mineral Resource
classification.
SRK is satisfied that the geological modelling honours the curr ent geological information and
knowledge. The location of the samples and the assay data are sufficiently reliable to support Mineral
Resource evaluation.
– IIIA-188 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 127
Generally, for mineralization exhibiting good geological contin uity investigated at an adequate
spacing with reliable sampling information accurately located, SRK considers that blocks estimated
during the first estimation run (pass) can be classified in the Measured Mineral Resource category,
the second estimation run can be classified in the Indicated Mi neral Resource category within the
meaning of the JORC Code.
8.9.1 Jilong Project
For all the blocks of the Zhuanshanzi Mine, the Mineral Resourc e with a mean sample distance of
40m are classified as Measured Mineral Resource; the Mineral Re source with a mean sample
distance of 80m are classified as Indicated Mineral Resource; and the Mineral Resource with a mean
sample distance of 160m are classified as Inferred Mineral Resource. Figure 8-30 shows the Mineral
Resource classification of the Zhuanshanzi Mine.
Figure 8-30: Mineral Resource Cate gory Distribution of Zhuanshanzi Mine
Note: #1#2#3&depth Block (dark red: Measured, blown: Indicated and green: Inferred) on the left and #4#5#6#7 Block on the right.
8.9.2 Huatai Project
For the Huatai project, the Mineral Resource with a mean sample distance of 40m are classified as
Measured Mineral Resource; the Mineral Resource with a mean sam ple distance of 80m are
classified as Indicated Mineral Resource, and the blocks exclud ed by Measured and Indicated
categories and within the mineralised domains should be appropr iately classified in the Inferred
category because the confidence in the estimate is insufficient to allow for the meaningful application
of technical and economic parameters or to enable an evaluation  of economic viability. Figure 8-31
shows the Mineral Resource classification of the Huatai Project.
– IIIA-189 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 128
Figure 8-31: Mineral Resource Category Distribution of Huatai Project

Note: #1 Mining Zone of Honghuagou Mine on the top left; #86 Ve in of Honghuagou Mine on the middle left; #3&#7 Vein of
Lianhuashan Mine on the bottom left; #26 Vein of Lianhuashan Mi ne on the top right; #5 Mining Zone of Lianhuashan Mine on the
middle right; and Pengjiagou Mine on the bottom right (dark red : Measured, blown: Indicated and green: Inferred) on the left and
#4#5#6#7 Block on the right.
8.9.3 Wulong Project
SRK considers that blocks estima ted with an average drillhole s pacing of less than 40 m can be
classified in the Indicated Mi neral Resource, and the blocks ex cluded by Indicated category and
within the mineralised domains should be appropriately classified in the Inferred category because
the confidence in the estimate is insufficient to allow for the  meaningful application of technical and
– IIIA-190 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mineral Resource Estimates    Final
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economic parameters or to enable an evaluation of economic viability. Figure 8-32 shows the Mineral
Resource classification of the Wulong Project.
Figure 8-32: Mineral Resource Category Distribution of Wulong Project


Note: Wulong Mine on the top left, Ligunzi Deposit on the top right and Haojingou-Ligunzi Deposit on the bottom.
8.9.4 Hanfeng Project
For the Lishan Mine, the resources with a mean sample distance of 40m are classified as Measured
Mineral Resource; Resource with a mean sample distance of 80m a re classified as Indicated
resources; the resources with a mean sample distance of 160m ar e classified as Inferred Mineral
Resource.
For the Dongfeng Mine, the resource with a mean sample distance of 50m are classified as Measured
Mineral Resource; the resource w ith a mean sample distance of 1 00m are classified as Indicated
Mineral Resource; and the resources with a mean sample distance of 200m are classified as Inferred
Mineral Resource.
For the spotted dog phenomenon caused by some samples with the sampling interval out of set
range, SRK adjusted it by cons idering the geological continuity , data quality and geologist's
confidence in the models of both mines (Figure 8-33).
– IIIA-191 –
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FOR THE PRC MINES


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Mineral Resource Estimates    Final
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Figure 8-33: Mineral Resource Category Distributions of Lishan and Dongfeng Mines
Note:
Lishan Mine (below -92m asl) on the left and Dongfeng Mine (below 250m asl) on the right.
Mineral Resource category: Measured in red, Indicated in blue and Inferred in green.
8.9.5 Jintai Project
SRK considers that the blocks estimated with an average drillhole spacing of less than 40 m for both
strike and dip directions can be classified in the Measured Min eral Resource category, the blocks
estimated with an average drillhole spacing of less than 80 m f or both strike and dip directions can
be classified in the Indicated Mineral Resource category, and the blocks excluded by Measured and
Indicated categories and within the mineralised domains should be appropriately classified in the
Inferred Mineral Resource category because the confidence in the estimate is insufficient to allow for
the meaningful application of technical and economic parameters  or to enable an evaluation of
economic viability. Figure 8-34 shows the Mineral Resource classification of the Jintai Project
Figure 8-34: Mineral Resource Category Distribution of Xidengping Mine


– IIIA-192 –
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FOR THE PRC MINES


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Mineral Resource Estimates    Final
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8.10 Mineral Resource Statement
The JORC Code defines a Mineral Resource as:
“a concentration or occurrence of material of solid material of economic interest in or on the Earth’s
crust in such form, grade (or quality) and quantity that there are reasonable prospects for eventual
economic extraction. The locat ion, quantity, grade (or quality) , continuity and other geological
characteristics of a Mineral Resource are known, estimated or i nterpreted from specific geological
evidence and knowledge, including sampling. Mineral Resources a re sub-divided, in order of
increasing geological confidence, into Inferred, Indicated and Measured categories.”
The RPEEE requirement generally implies that the quantity and g rade estimates meet certain
economic thresholds and that the Mineral Resources are reported  at an appropriate cut-off grade
taking into account extraction scenarios and processing recoveries. In order to meet this requirement,
SRK considers that major portions of the Jilong Project, Huatai Project, Wulong Project and Hanfeng
Project are amenable for underground mining and that major port ions of the Jintai Project are
amenable for open it extraction.
The conceptual parameters used in the Chifeng Gold Project are summarised in Table 8-47. The
reader is cautioned that the results of the estimate are used s olely for the purpose of testing the
RPEEE by underground mining and do not represent an attempt to estimate Ore reserves. The
results are to be used as a guide for assisting in the preparat ion of a Mineral Resource Statement
and for selecting an appropriate Mineral Resource-reporting cut-off grade.
Table 8-47: Conceptual Assumptions Considered for Chifeng Gold Project
Parameter Unit Jilong Huatai Wulong Hanfeng Jintai
Gold Metal Price US$ per ounce 2,150 2,150 2,150  2,150
Zinc Metal Price US$ per ton 2,550
Molybdenum US$ per ton 29,500
Mining Cost US$ per ton ore 104.51 125.78 96.41 9.07 1.52
Processing Cost US$ per ton ore 19.31 25.80 76.33 9.31 6.70
G&A Cost US$ per ton ore 30.62 30.62 30.62 3.49 4.32
Mining Dilution percent 20 20 20 32 5
Processing Recovery percent 97% Au 93% Au 91% Au 88% Zn; 70% Mo  78% Au
Gold cut-off Grade Grams per tonne 1.5g/t Au 1.5g/t Au 1.5g/t A u 0.5% Zn; 0.03% Mo 0.17g/t
Au
SRK considers that the blocks not below a cut-off grade of 1.5g/t Au show “reasonable prospects for
eventual economic extraction” from an underground mine for the Jilong, Huatai and Wulong projects
can be reported as a Mineral Resource, that the blocks not below a cut-off grade of 0.5% Zn for the
Lishan Mine and 0.03% Mo for the Dongfeng Mine show “reasonable prospects for eventual
economic extraction” from an underground mine for the Hanfeng Project can be reported as a Mineral
Resource, and that the blocks not below a cut-off grade of 0.17 g/t Au show “reasonable prospects
for eventual economic extraction” from an open pit mine for the  Jintai Project can be reported as a
Mineral Resource.
8.10.1 Jilong Project
As of 30 September 2024, the Jilong Project is estimated to con tain 484 kt of Measured Mineral
Resources with an average grade of 12.19g/t Au, 424 kt of Indic ated Mineral Resources with an
– IIIA-193 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1019 ---
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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 132
average grade of 9.25g/t Au, and 508 kt of Inferred Mineral Res ources with an average grade of
9.24g/t Au (see Table 8-48).
Table 8-48: Mineral Resource St atement of Jilong Project, as of 30 September 2024
Mineralised Zone/Block Category Tonnage Grade Contained
Au
Contained
Au
kt (g/t Au) (t) (koz)
Zhuanshanzi
#1#2#3&depth
Measured 299 9.21 2.76 89
Indicated 282 7.24 2.04 66
Measured +
Indicated 581 8.25 4.80  154
Inferred 433 8.56 3.71 119
Zhuanshanzi #4#5#6#7
Measured 184 17.04 3.14 101
Indicated 142 13.27 1.88 60
Measured +
Indicated 326 15.40 5.02 161
Inferred 75 13.16 0.99 32
Total
Measured 484 12.19 5.90 190
Indicated 424 9.25 3.92 126
Measured +
Indicated 907 10.82 9.82 316
Inferred 508 9.24 4.70 151
Notes:
1 All figures are rounded to reflect the relative accuracy of the estimate. All composites have been capped where appropriate.
2 The information in this report which relates to Mineral Resource is based on information compiled by Mr. Mingyan wang and
Dr. Yiefei Jia who are both full time employees of SRK Consulti ng China. Dr. Jia is a Fellow of AusIMM and a Chartered
Professional in Geology (CP Geo). Both have sufficient experien ce which is relevant to the style of mineralisation and the
type of deposits under consideration and to the activity which they are undertaking to qualify as the Competent Persons as
defined in the 2012 edition of the “Australasian Code for Repor ting of Exploration results, Mineral Resources and Ore
Reserves”, the JORC Code. Dr. Jia consents to the reporting of this information in the form and context in which it appears.
3 The cut-off grad is 1.5g/t.
8.10.2 Huatai Project
As of 30 September 2024, the Huatai Project is estimated to con tain 385 kt of Measured Mineral
Resources with an average grade of 5.88g/t Au, 2,146 kt of Indi cated Mineral Resources with an
average grade of 7.27g/t Au, and 1,281 kt of Inferred Mineral R esources with an average grade of
6.90g/t Au (see Table 8-49).
Table 8-49: Mineral Resource Stat ement of Huatai Project, as of 30 September 2024
Mineralized Zone/Block Category Tonnage
(kt)
Au Grade
(g/t)
Au Metal
Contained
(t)
Au Metal
Contained
(koz)
Honghuagou #1 Mining
Zone
Measured 251  6.21 1.56 50.1
Indicated 759  6.48 4.92 158.1
Measured +
Indicated 1,011  6.41 6.48 208.2
Inferred 419  5.87 2.46 79.2
Honghuagou #86 Vein
Measured -  0.00 -
Indicated 315  5.30 1.67 53.7
Measured +
Indicated 315  5.30 1.67 53.7
Inferred 103  5.34 0.55 17.7
– IIIA-194 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 133
Mineralized Zone/Block Category Tonnage
(kt)
Au Grade
(g/t)
Au Metal
Contained
(t)
Au Metal
Contained
(koz)
Honghuagou Pengjiagou
mine
Measured - - 0.00 -
Indicated 338  5.36 1.81 58.3
Measured +
Indicated 338  5.36 1.81 58.3
Inferred 148  5.88 0.87 28.0
Lianhuashan #5 Mining
Zone
Measured 134  5.28 0.71 22.7
Indicated 109  8.00 0.87 28.0
Measured +
Indicated 243  6.50 1.58 50.7
Inferred 148  5.88 0.87 28.0
Lianhuashan #26 Vein
Measured - - 0.00 -
Indicated 217  9.54 2.07 66.5
Measured +
Indicated 217  9.54 2.07 66.5
Inferred 135  9.34 1.26 40.6
Lianhuashan #3-7 Vein
Measured - - 0.00 -
Indicated 408  10.46 4.27 137.1
Measured +
Indicated 408  10.46 4.27 137.1
Inferred 328  8.61 2.82 90.7
Total
Measured 385  5.88 2.27 73
Indicated 2,146  7.27 15.60 502
Measured +
Indicated 2,531  7.06 17.87 575
Inferred 1,281  6.90 8.83 284
Notes:
1 All figures are rounded to reflect the relative accuracy of the estimate. All composites have been capped where appropriate.
2 The information in this report which relates to Mineral Resource is based on information compiled by Mr. Huaixiang (Hubert)
Li, Mr. Mingyan wang and Dr. Yiefei Jia who are full time emplo yees of SRK Consulting China. Mr. Li is a Member of AIG
and Dr. Jia is a Fellow of AusIMM and a Chartered Professional in Geology (CP Geo). They have sufficient experience
which is relevant to the style of mineralisation and the type o f deposits under consideration and  to the activity which they
are undertaking to qualify as the Competent Persons as defined in the 2012 edition of the “Australasian Code for Reporting
of Exploration results, Mineral Resources and Ore Reserves”, the JORC Code. Mr Li, Mr. Wang and Dr. Jia consents to the
reporting of this information in the form and context in which it appears.
3 The cut-off grad is 1.5g/t Au.
8.10.3 Wulong Project
As of 30 September 2024, the Wulong Project is estimated to con tain 1,261 kt of Indicated Mineral
Resources with an average grade of 8.17g/t Au, and 1,738 kt of Inferred Mineral Resources with an
average grade of 7.21g/t Au (see Table 8-50).
Table 8-50: Mineral Resource Stat ement, Wulong Project, as of 30 September 2024
Mineralized Zone/Block Category Tonnage
(kt)
Au Grade
(g/t)
Au Metal
Contained
(t)
Au Metal
Contained
(koz)
Wulong
Measured - - - -
Indicated 997  8.88 8.85 285
Measured +
Indicated 997 8.88 8.85  285
– IIIA-195 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 134
Mineralized Zone/Block Category Tonnage
(kt)
Au Grade
(g/t)
Au Metal
Contained
(t)
Au Metal
Contained
(koz)
Inferred 1,371  7.39 10.15 326
Ligunzi
Measured - - - -
Indicated 126  5.16 0.65 21
Measured +
Indicated 126 5.16 0.65  21
Inferred 99  5.36 0.53 17
Haojingou-Ligunzi
Measured - - - -
Indicated 138 5.74 0.80 26
Measured +
Indicated 138 5.74 0.80  26
Inferred 268 6.73 1.85 59
Total
Measured - - - -
Indicated 1,261 8.17  10.30 332
Measured +
Indicated 1,261 8.17  10.30 332
Inferred 1,738 7.21  12.53 402
Notes:
1 All figures are rounded to reflect the relative accuracy of the estimate. All composites have been capped where appropriate.
2 The information in this report which relates to Mineral Resource is based on information compiled by Mr. Huaixiang (Hubert)
Li and Dr. Yiefei Jia who are full time employees of SRK Consulting China. Mr. Li is a Member of AIG and Dr. Jia is a Fellow
of AusIMM and a Chartered Professional in Geology (CP Geo). Bot h have sufficient experience which is relevant to the
style of mineralisation and the type of deposits under consideration and to the activity which they are undertaking to qualify
as the Competent Persons as defined in the 2012 edition of the “Australasian Code for Reporting of Exploration results,
Mineral Resources and Ore Reserves”, the JORC Code. Mr. Li and Dr. Jia consents to the reporting of this information in
the form and context in which it appears.
3 The cut-off grad is 1.5g/t Au.
8.10.4 Hanfeng Project
Within the current mining License area and permitted elevation range, as of 30 September 2024, the
Lishan Mine (below-92m asl) contains 752 kt of Measured Mineral  Resources at an average grade
of 2.36% Zn, 0.01% Cu and 0.12% Pb; 8,583 kt of Indicated Mineral Resources at an average grade
of 2.66% Zn, 0.07% Cu and 0.12% Pb, and 10,616 kt of Inferred M ineral Resources at an average
grade of 2.90% Zn, 0.09% Cu, 0.13%Pb. Details of estimated Mineral Resources are shown in Table
8-51.
Table 8-51: Mineral Resource Statement of Lishan Mine, as of 30 September 2024
Mineralised
Zone/Block Category Tonnage (kt)
Zn
Grade
(%)
Zn Metal
Contained
(kt)
Cu
Grade
(%)
Cu Metal
Contained
(kt)
Pb
Grade
(%)
Pb Metal
Contained
(kt)
Lishan
Measured 752  2.36 18 - - 0.12 1
Indicated 8,583  2.66 229 0.07 6 0.12 10
Measured
+
Indicated
9,335  2.64 246 0.06 6 0.12 11
Inferred 10,616  2.90 308 0.09 10 0.13 14
Notes：
1 Differences may occur in totals due to rounding.
2 All figures are rounded to reflect the relative accuracy of the estimate.
– IIIA-196 –
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FOR THE PRC MINES


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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 135
3 The information in this report which relates to Mineral Resource is based on information compiled by Ms. Yanfang (Bonnie)
Zhao and Dr. Yiefei Jia who are both full time employees of SRK Consulting China, Ms. Zhao is a Member of AusIMM, and
Dr. Jia is a Fellow of AusIMM and a Chartered Professional in G eology (CP Geo). Dr. Yiefei Jia have sufficient experience
which is relevant to the style of mineralisation and the type o f deposits under consideration and  to the activity which they
are undertaking to qualify as the Competent Persons as defined in the 2012 edition of the “Australasian Code for Reporting
of Exploration results, Mineral Resources and Ore Reserves”, th e JORC Code.  Ms. Zhao and Dr. Jia consent to the
reporting of this information in the form and context in which it appears.
4 The cut-off grade is 0.5% Zn.
As of 30 September 2024, the Dongfeng Mine (below 250m asl) con tains 1,819 kt of Measured
Mineral Resources at an average gr ade of 0.11% Mo, 26,495 kt of  Indicated Mineral Resources at
an average grade of 0.12% Mo, and 37,053 kt of Inferred Mineral Resources at an average grade of
0.12% Mo. Details of estimated resources are shown in Table 8-52.
Table 8-52: Mineral Resource Statement of Dongfeng Mine, as of 30 September 2024
Mineralised
Zone/Block Category Tonnage (kt) Mo Grade
(%)
Mo Metal Contained
(kt)
Dongfeng
Measured 1,819  0.11 2
Indicated 26,495  0.12 32
Measured + Indicated 28,314  0.12 34
Inferred 37,053  0.12 45
Notes：
1 Differences may occur in totals due to rounding.
2 All figures are rounded to reflect the relative accuracy of the estimate.
3 The information in this report which relates to Mineral Resource is based on information compiled by Ms. Yanfang (Bonnie)
Zhao and Dr. Yiefei Jia who are both full time employees of SRK Consulting China, Ms. Zhao is a Member of AusIMM, and
Dr. Jia is a Fellow of AusIMM and a Chartered Professional in G eology (CP Geo). Dr. Yiefei Jia have sufficient experience
which is relevant to the style of mineralisation and the type o f deposits under consideration and  to the activity which they
are undertaking to qualify as the Competent Persons as defined in the 2012 edition of the “Australasian Code for Reporting
of Exploration results, Mineral Resources and Ore Reserves”, th e JORC Code.  Ms. Zhao and Dr. Jia consent to the
reporting of this information in the form and context in which it appears.
4 The cut-off grade is 0.03% Mo
8.10.5 Jintai Project
As of 30 September 2024, the Jintai Project contains 3,363 kt of Measured Mineral Resources at an
average grade of 1.68g/t Au, 4,604 kt of Indicated Mineral Resources at an average grade of 1.02g/t
Au, and 2,699 kt of Inferred Mineral Resources at an average gr ade of 1.29g/t Au. Details of
estimated resources are shown in Table 8-53.
Table 8-53: Mineral Resource Statement, Jintai Project, as of 30 September 2024
Domain Category Quantity
(kt)
Au
Grade
(g/t)
Contained
Au Metal
(t)
Contained
Au Metal
(koz)
V1
Measured - - -  -
Indicated 1,738 0.74 1.29  42
Measured + Indicated 1,738 0.74 1.29  42
Inferred 164 0.47 0.08  2
V2
Measured - - - -
Indicated 266 0.96 0.26  8
Measured + Indicated 266 0.96 0.26  8
Inferred 605  2.17  1.31  42
V2_1
Measured  -
Indicated - - - -
Measured + Indicated -   -   -    -
– IIIA-197 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1023 ---
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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 136
Domain Category Quantity
(kt)
Au
Grade
(g/t)
Contained
Au Metal
(t)
Contained
Au Metal
(koz)
Inferred 36 0.34 0.01  0
V2_2
Measured - - - -
Indicated - - - -
Measured + Indicated -   -   -    -
Inferred 125  0.44  0.05  2
V4
Measured 3,363  1.68  5.64  181
Indicated 2,270 1.19 2.71  87
Measured + Indicated 5,633 1.19 8.34  268
Inferred 593 1.22 0.72  23
V5
Measured - - - -
Indicated - - - -
Measured + Indicated -   -   -    -
Inferred 211  0.68  0.14  5
V6
Measured - - - -
Indicated - - - -
Measured + Indicated -   -   -    -
Inferred 7  0.86  0.01  0
V7
Measured - - - -
Indicated - - - -
Measured + Indicated -   -   -    -
Inferred 336  0.46  0.15  5
V8
Measured - - - -
Indicated - - - -
Measured + Indicated -   -   -    -
Inferred 173 0.87 0.15  5
V9
Measured - - - -
Indicated - - - -
Measured + Indicated -   -   -    -
Inferred 255  1.39  0.36  11
V10
Measured - - - -
Indicated 331  1.34  0.44  14
Measured + Indicated 331 1.34 0.44  14
Inferred 193 2.60 0.50  16
Total
Measured 3,363 1.68 5.64  181
Indicated 4,604 1.02 4.70  151
Measured + Indicated 7,967 1.30 10.33  332
Inferred 2,699 1.29 3.49  112
Notes:
1 Differences may occur in totals due to rounding.
2 All figures are rounded to reflect the relative accuracy of the estimate.
3 The information in this report which relates to Mineral Resourc e is based on information compiled by Mr. Shaobo Dai, Mr.
Huaixiang (Hubert) Li and Dr. Yiefei Jia who are full time empl oyees of SRK Consulting China, Mr. Li is a Member of AIG,
and Dr. Jia is a Fellow of AusIMM and a Chartered Professional in Geology (CP Geo). Dr. Yiefei Jia have sufficient
experience which is relevant to the style of mineralisation and  the type of deposits under consideration and to the activity
which they are undertaking to qualify as the Competent Persons as defined in the 2012 edition of the “Australasian Code
for Reporting of Exploration results, Mineral Resources and Ore Reserves”, the JORC Code.  Mr. Li and Dr. Jia consent to
the reporting of this information in the form and context in which it appears.
4 The cut-off grad is 0.17g/t Au.
8.11 Grade Sensitivity Analysis
8.11.1 Jilong Project
The Mineral Resources of the Jilong Project are sensitive to th e selection of the reporting cut-off
grade. To illustrate this sensitivity, the global model quantit ies and grade estimates of the
– IIIA-198 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 137
#1#2#3&depth Block of the Zhuanshanzi Mine are presented in Table 8-54 at different cut-off grades.
The reader is cautioned that the figures presented in this tabl e should not be misconstrued with a
Mineral Resource Statement. The figures are only presented to s how the sensitivity of the block
model estimates to the select ion of cut-off grade. Figure  8-35 present this sensitivity as grade
tonnage curves of the #1#2#3&depth Block of the Zhuanshanzi Mine.
Table 8-54: Global Block Model Quantities and Grade Estimates 1, #1#2#3&depth Block of
Zhuanshanzi Mine
Cut-off Grade Au (g/t) Quantity (Mt) Au Grade (g/t)
1.40 1.30 8.87
1.60 1.30 8.88
1.80 1.30 8.88
2.00 1.30 8.89
2.20 1.30 8.89
2.40 1.30 8.89
2.60 1.30 8.89
2.80 1.30 8.90
3.00 1.30 8.90
3.20 1.30 8.91
3.40 1.29 8.92
3.60 1.29 8.93
3.80 1.29 8.95
4.00 1.28 8.97
4.20 1.27 9.00
4.40 1.26 9.05
4.60 1.24 9.14
4.80 1.20 9.27
5.00 1.16 9.44
5.20 1.12 9.58
5.40 1.07 9.76
5.60 1.02 9.97
Notes:
1 The reader is cautioned that the figures in this table should n ot be misconstrued with a Miner al Resource Statement. The
figures are only presented to show the sensitivity of the block model estimates to the selection of a cut-off grade.
– IIIA-199 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 138
Figure 8-35: Grade Tonnage Curves of #1#2#3&depth Block of Zhuanshanzi Mine

8.11.2 Huatai Project
The Mineral Resources of the Huatai Project are sensitive to th e selection of the reporting cut-off
grade. To illustrate this sensitivity, the global model quantities and grade estimates of the #1 Mining
Zone, #86 Vein, #3&#7 Vein, #26 Vein, #5 Mining Zone and Pengjiagou Mine are presented in Table
8-54 at different cut-off grades. The reader is cautioned that the figures presented in this table should
not be misconstrued with a Mineral Resource Statement. The figures are only presented to show the
sensitivity of the block model est imates to the selection of cu t-off grade. Figure 8-36 present this
sensitivity as grade tonnage curves of the #1 Mining Zone, #86 Vein, #3&#7 Vein, #26 Vein, #5
Mining Zone and Pengjiagou Mine.
Table 8-55: Global Block Model Quantities and Grade Estimates1, Huatai Project
Mine Cut-off Grade Au (g/t) Q uantity (Mt) Au Grade (g/t)
Honghuagou #1 Mining Zone
1.6 1.43 6.25
1.8 1.43 6.25
2.0 1.43 6.26
2.2 1.43 6.26
2.4 1.42 6.27
2.6 1.42 6.27
2.8 1.42 6.28
3.0 1.41 6.29
3.2 1.41 6.30
3.4 1.40 6.32
3.6 1.39 6.35
3.8 1.37 6.38
4.0 1.35 6.42
4.2 1.32 6.47
4.4 1.29 6.52
4.6 1.26 6.58
4.8 1.22 6.64
5.0 1.15 6.74
5.2 1.06 6.88
Honghuagou #86 Vein
1.0 0.67 5.18
1.5 0.67 5.18
2.0 0.67 5.19
2.5 0.66 5.21
3.0 0.65 5.27
– IIIA-200 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 139
Mine Cut-off Grade Au (g/t) Q uantity (Mt) Au Grade (g/t)
3.5 0.64 5.30
4.0 0.63 5.32
4.5 0.60 5.38
5.0 0.52 5.46
Lianhuashan #3&#7 Vein
1.0 0.59 6.29
1.5 0.59 6.31
2.0 0.58 6.34
2.5 0.58 6.39
3.0 0.57 6.43
3.5 0.55 6.55
4.0 0.51 6.78
4.5 0.48 6.95
5.0 0.42 7.25
Lianhuashan #26 Vein
1.0 0.35 9.46
1.5 0.35 9.46
2.0 0.35 9.46
2.5 0.35 9.47
3.0 0.35 9.47
3.5 0.35 9.48
4.0 0.35 9.49
4.5 0.35 9.51
5.0 0.34 9.57
Lianhuashan #5 Mining Zone
1.0 0.59 6.29
1.5 0.59 6.31
2.0 0.58 6.34
2.5 0.58 6.39
3.0 0.57 6.43
3.5 0.55 6.55
4.0 0.51 6.78
4.5 0.48 6.95
5.0 0.42 7.25
Honghuagou Pengjiagou Mine
1.6 1.43 6.25
1.8 1.43 6.25
2.0 1.43 6.26
2.2 1.43 6.26
2.4 1.42 6.27
2.6 1.42 6.27
2.8 1.42 6.28
3.0 1.41 6.29
3.2 1.41 6.30
3.4 1.40 6.32
3.6 1.39 6.35
3.8 1.37 6.38
4.0 1.35 6.42
4.2 1.32 6.47
4.4 1.29 6.52
4.6 1.26 6.58
4.8 1.22 6.64
5.0 1.15 6.74
Notes:
– IIIA-201 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1027 ---
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Mineral Resource Estimates    Final
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1 The reader is cautioned that the fi gures in this table should n ot be misconstrued with a Mineral Resource Statement. The
figures are only presented to show the sensitivity of the block model estimates to the selection of a cut-off grade.
Figure 8-36: Grade Tonnage Curves of Huatai Project
Note:
Honghuagou #1 Mining Zone on the top left, Honghuagou #86 Vein on the middle left and Lianhuashan #3&#7 Vein on the bottom left
Lianhuashan #26 Vein on the top right, Lianhuashan #5 Mining Zone on the middle right and Pengjiagou Mine on the bottom right.
8.11.3 Wulong Project
The Mineral Resources of the Wulong project are sensitive to th e selection of the reporting cut-off
grade. To illustrate this sensitivity, the global model quantities and grade estimates are presented in
Table 8-56 at different cut-off grades. The reader is cautioned that the figures presented in this table
should not be misconstrued with a Mineral Resource Statement. T he figures are only presented to
show the sensitivity of the block model estimates to the select ion of cut-off grade.  Figure 8-37
presents the sensitivity as grade tonnage curves of the Wulong Project.
Table 8-56: Global Block Model Quantities and Grade Estimates1, Wulong Project
Mine/Deposit Cut-off Grade Au (g/t) Quantity (Mt) Au Grade (g/t )
Wulong Mine
0.8 3,115 8.59
0.9 3,115 8.59
1.0 3,113 8.59
– IIIA-202 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mineral Resource Estimates    Final
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Mine/Deposit Cut-off Grade Au (g/t) Quantity (Mt) Au Grade (g/t )
1.1 3,098 8.63
1.2 3,083 8.66
1.3 3,081 8.67
1.4 3,081 8.67
1.5 3,081 8.67
Ligunzi Deposit
1.3 306 5.35
1.4 305 5.36
1.5 305 5.37
1.6 304 5.37
1.7 304 5.38
1.8 304 5.38
1.9 303 5.38
2.0 303 5.39
2.1 298 5.44
2.2 296 5.46
2.3 296 5.47
2.4 295 5.47
2.5 295 5.48
Haojingou-Ligunzi Deposit
0.5 569 6.23
0.6 563 6.28
0.7 557 6.34
0.8 556 6.36
0.9 545 6.47
1.0 541 6.51
1.1 539 6.53
1.2 538 6.54
1.3 535 6.57
1.4 532 6.59
1.5 530 6.62
Notes:
1 The reader is cautioned that the figures in this table should n ot be misconstrued with a Miner al Resource Statement. The
figures are only presented to show the sensitivity of the block model estimates to the selection of a cut-off grade.
– IIIA-203 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 142
Figure 8-37: Grade Tonnage Curves of Wulong Project

8.11.4 Hanfeng Project
Mineral Resource is sensitive to the selection of cut-off grade . To illustrate this sensitivity, ore
quantities and grade estimates at different cut-off grades of the Lishan and Dongfeng mines are
presented in Table 8-57. The reader is cautioned that the figur es presented in this table should not
be mistaken for a Mineral Resource Statement. The figures are only presented to show the sensitivity
of the block model estimates to the selection of cut-off grade. Figure 8-38 represents this sensitivity
as tonnage-grade curves of the Lishan and Dongfeng mines.
Table 8-57: Block Model Quantities and Grade Estimates1, Hanfeng Project
Mine Cut-off Grade (Zn %) Q uantity (Mt) Zn Grade (%)
Lishan Mine
0.5 19.95 2.78
0.6 19.71 2.80
0.7 19.55 2.82
0.8 19.30 2.85
0.9 19.06 2.87
1.0 18.78 2.90
1.1 18.40 2.94
1.2 18.05 2.98
1.3 17.61 3.02
– IIIA-204 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 143
Mine Cut-off Grade (Mo %) Quantity (Mt) Mo Grade (%)
Dongfeng Mine
0.03 65.37 0.12
0.04 62.56 0.13
0.05 58.48 0.13
0.06 53.74 0.14
0.07 49.47 0.14
0.08 44.59 0.15
0.09 40.49 0.16
0.10 35.66 0.17
Notes:
1 The reader is cautioned that the fi gures in this table should n ot be misconstrued with a Mineral Resource Statement. The
figures are only presented to show the sensitivity of the block model estimates to the selection of cut-off grade.
Figure 8-38: Tonnage-Grade Curves of Lishan and Dongfeng Mines

8.11.5 Jintai Project
The Mineral Resources of the Xidengping mine are sensitive to the selection of the reporting cut-off
grade. To illustrate this sensitivity, the global model quantities and grade estimates are presented in
Table 8-58 at different cut-off grades. The reader is cautioned that the figures presented in this table
should not be misconstrued with a Mineral Resource Statement. T he figures are only presented to
show the sensitivity of the block model estimates to the select ion of cut-off grade. Figure 8-39
presents this sensitivity as grade tonnage curves.
Table 8-58: Global Block Model Quantities and Grade Estimates1, Xidengping Mine at Various
Cut-off Grades
Deposit
Cut-off Grade Quantity Grade
Gold(g/t) (Mt) Gold(g/t)
Xidengping
0.0 11.48 1.25
0.1 11.48 1.25
0.2 11.47 1.25
0.3 11.18 1.27
0.4 10.24 1.36
0.5 9.10 1.47
0.6 7.90 1.61
0.7 6.81 1.77
0.8 5.92 1.92
0.9 5.29 2.05
1.0 4.83 2.16
– IIIA-205 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mineral Resource Estimates    Final
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Notes:
1 The reader is cautioned that the figures in this table should n ot be misconstrued with a Miner al Resource Statement. The
figures are only presented to show the sensitivity of the block model estimates to the selection of a cut-off grade.
Figure 8-39: Grade Tonnage Curves of Xidengping Mine
– IIIA-206 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Ore Reserve Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 145
9 Ore Reserve Estimates
According to the JORC Code,
an ‘Ore Reserve’ is the economically mineable pa rt of a Measured and/ or Indicated Mineral
Resource. It includes diluting materials and allowances for losses, which may occur when the
material is mined or extracted and is defined by studies at Pre-feasibility or Feasibility level as
appropriate that include application of Modifying Factors. Such studies demonstrate that, at the time
of reporting, extraction could reasonably by justified.
The Modifying Factors are considerations used to  convert Mineral Resources to Ore Reserves.
These include, but are not restricted to mining, pr ocessing, metallurgical, infrastructure, economic,
marketing, legal, environmental. Social and governmental factors.
Figure 9-1 provide for a direct relationship between Indicated Mineral Resources and Probable Ore
Reserve and between Measured Mineral Resources and Proved Ore Reserve.
Figure 9-1: Relationship Between Mineral Resources and Ore Rese rve

Sources: JORC Code (2012)
According to the JORC Code, a Probable Ore Reserve is the econo mically mineable part of an
Indicated, and in some cases, a Measured Mineral Resource. The confidence in the modifying factors
applying to a Probable Ore Reserve is lower than that applying to a Proved Ore Reserve. A Proved
Ore Reserve, on the other hand, is the economically mineable part of a Measured Mineral Resource
and implies a high degree of confidence in the modifying factors.
The Ore Reserve estimates for the Jilong, Huatai, Wulong, Hanfe ng, and Jintai Projects have been
prepared in accordance with the JORC Code. These estimates were derived by applying modifying
factors to the Mineral Resource Estimate, with only Measured an d Indicated resources being
– IIIA-207 –
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FOR THE PRC MINES


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Ore Reserve Estimates    Final
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converted to Ore Reserve. Inferred resources were treated as waste with zero grade. These projects
are operational mines, and their designs and operating practice s were reviewed to at least a
prefeasibility study level.
The Jilong, Huatai, Wulong, and Hanfeng Projects are underground mines. Skin dilution was applied
into the stope shape as an equivalent linear overbreak slough. Subsequently, these annealed
mineable shapes were cut using Stope Slicer within GEOVIA Surpa cTM. Stopes falling outside the
design scope or with irregular shapes were filtered out. The cu t-off grade with gold price of
US$2,050/oz and a zinc price of US$2,550/t were used to estimate the in-stope Ore Reserves. The
factors such as ore loss were factored in Microsoft Excel.
The Jintai Project is an open pit mine. The optimal economic shape for the open pit was determined
using GEOVIA Whittle TM optimization. SRK compared this optimal shape with the open pi t design
from the prefeasibility study and found minimal discrepancies. Consequently, SRK decided to use
the prefeasibility study's open pit design. The mining dilution and ore loss were also considered and
factored into Ore Reserves.
9.1 Jilong Project
9.1.1 Introduction
Jilong Mining is actively operating and includes several deposi ts within its various mining zones,
specifically Zone 1 through Zone 7. Each of these zones is eith er currently being exploited or is
planned for future exploitation. The locations of these mines, along with their respective veins, are
detailed in Figure 9-2, which has been reviewed for the Ore Reserve estimation.
Figure 9-2: Plan View of Mining Zones

Sources: SRK
– IIIA-208 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Ore Reserve Estimates    Final
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9.1.2 Mineral Resources Model
The Jilong Project resource block model was completed by SRK geologist in a *.mdl file format, and
it has been converted into *.dm file format for design and scheduling purposes.
9.1.3 Feasibility Study
SRK has reviewed the following preliminary design studies:
 Zhuanshanzi #1 Mining Zone Preliminary Design by Chifeng Zhengh ang Design Company in
February 2024;
 Zhuanshanzi #2 Mining Zone Preliminary Design by Chifeng Jilong Mining Company in February
2024;
 Zhuanshanzi #3 Mining Zone Preliminary Design by Inner Mongolia  Mining Development
Company in February 2024;
 Zhuanshanzi periphery Mining Zone (#4, #5, #6, #7 Mining Zone) Preliminary Design by Chifeng
Zhenghang Design Company in February 2024.
9.1.4 Cut-off Grade
The unit cost of mining, processing, general and administrative, and processing recovery from 2021
to 2024 Q3 were provided by Jilong Mining, as detailed in Table 9-1. The cut-off grade is calculated
to be 2.76g/t, based on the average historical three-year unit costs, while also considering processing
recovery and royalty factors, as shown in Table 9-2.
Table 9-1: Unit Cost of Jil ong Project from 2021 to 2024Q3
Item Unit 2021 2022 2023 2024 Q1-Q3
Mining Cost RMB/t Ore 1,379  1,632  1,050  983
Processing Cost RMB/t Or e 110  113  108  106
G&A Cost RMB/t Ore 211  200  283  172
Processing Recovery for
Au %  97  97  98  97
Sources: Client
1 The mining production and unit cost only include stope production.

Table 9-2: Cut-off Grade Calculation
Item  Unit  Assumption
Gold Price USD/oz 2,050
Gold Price 1 RMB/g 476
 Mining RMB/t ore  903
Processing RMB/t ore 109
 G&A RMB/t ore  216
 Processing Recovery %  97
Royalty % 4
Cut-off Grade  g/t 2.76
Sources: SRK
– IIIA-209 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Ore Reserve Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 148
1 The exchange rate of 7.22 USD to RMB was applied.
2 The mining production and unit cost only include stope producti on. Since the mining contractor also mining remnants
extraction and haulaging low-grade ore, the mining cost has been factored and adjusted downward.
9.1.5 Mining Dilution and Ore Loss
Mining dilution includes unplanned dilution from stope wall fai lures and overbreak from stope walls
and floors. Waste rock dilution primarily originates from material sloughing off the hanging wall, with
minor contributions from the ends and floors of the stoping are a. Waste dilution typically ranges
between 0.04m and 0.2m, depending on the size and shape of the orebodies.
To estimate mining dilution, SRK has expanded the orebody wiref rame by 0.04 to 0.2m in all
directions (Green line in Figure 9-3), creating skins as an equivalent linear overbreak slough. Overall,
it is estimated that mining dilution will be approximately 16-17%.
Additionally, a mining loss of 5% was estimated and applied to the Ore Reserve estimation.
Figure 9-3: Skin Analysi s for Mining Dilution

Sources: SRK
9.1.6 Ore Reserve Estimates
The estimated process details are provided in Table 9-3, with t he corresponding waterfall charts
illustrated in Figure 9-4 and Figure 9-5.
Approximately 65% of tonnes and 55% of metal have been converte d from Mineral Resources to
Ore Reserve. Key negative factors affecting this conversion include the exclusion of Inferred Mineral
Resources.
Table 9-3: Estimated Process Summary
Conversion Process Tonnage (kt) Au Contained (kg)
M+I+I Resources  1,415   14,514
Inferred Resources Exclusion (508)  (4,697)
M+I Resources  907   9,817
Design Boundary (39)  (584)
– IIIA-210 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1036 ---
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Ore Reserve Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 149
Conversion Process Tonnage (kt) Au Contained (kg)
Irregular Shape (46)  (636)
COG Filter  (20)  (154)
Mining Dilution 166  1
Ore Loss  (48)  (422)
Ore Reserve 920  8,022
Sources: SRK
Figure 9-4: Estimated Process - Change in Tonnes

Sources: SRK
Figure 9-5: Estimated Process - Change in Metal Contained

Sources: SRK
9.1.7 Ore Reserve statement
SRK has estimated the Ore Reserve for the Jilong Project in com pliance with the JORC Code. The
Ore Reserve, with an effective date of 30 September 2024, is summarised in Table 9-4.
As of 30 September 2024, the total Ore Reserve for the Jilong P roject is estimated at 919 kt at an
average grade of 8.73g/t Au, containing 8.02 t of gold. This in cludes the Proved Ore Reserve
– IIIA-211 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1037 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Ore Reserve Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 150
estimated at 510 kt at an average grade of 9.81g/t Au, containi ng 5.00 t of gold, and the Probable
Ore Reserve estimated at 409 kt at an average grade of 7.38g/t Au, containing 3.02 t of gold.
Table 9-4: Jilong Project Undergr ound Ore Reserve Statement, as of 30 September 2024
Reserve
Category Tonnage (kt) Au Grade (g/t) Au Metal Contained (t) Au Metal Con tained (koz)
Proved 510 9.81 5.00 161
Probable 409 7.38 3.02 97
Total 919 8.73 8.02 258
Sources: SRK
Notes:
1 The information relates to Ore Reserve conversion is based on information compiled by Ms. Tzuhsuan Chuang, MAusIMM
and Dr. Yiefei Jia, FAusIMM and a Chartered Professional in Geology (CP Geo), employees of SRK Consulting China Ltd.
Both Dr. Jia and Ms. Chuang have sufficient experience relevant  to the style of mineralisation and type of deposit under
consideration and to the activity which they are undertaking to qualify as Competent Persons as defined in the JORC Code.
Dr. Jia supervised the work of Ms. Chuang.  Dr. Jia and Ms. Chuang consent to the reporting of this information in the form
and context in which it appears;
2 The Ore Reserves Statement is based on the depletion data provided by Jilong Mine for the six-month period, 1 April 2024
to 30 September 2024. The reported Jilong Mine data may differ from that reported by SRK, due the updated Block model
now used by Jilong Mine for reporting. SRK considers this updat ed block model to be more representative of actual
production conditions and has therefore adopted the Jilong Mine provided data as the basis for this statement.
3 Ore Reserve are estimated at a cut-off grade of 2.76g/t Au;
4 Number was rounded to the second significant digit;
5 Total may not add due to rounding discrepancies; and
6 Mining dilution is 16-17% and ore loss is 5%.
9.2 Huatai Project
9.2.1 Introduction
Huatai Project is actively operating and includes several deposits within the following mining zones:
 Pengjiagou Mine;
 Honghuagou #1 Mining Zone (referred to as Zone 1);
 Honghuagou #86 Vein (referred to as Vein 86);
 Lianhuashan #5 Mining Zone (referred to as Area 5);
 Lianhuashan #26 Vein (referred to as Vein 26);
 Lianhuashan #3&#7 Vein (referred to as Vein 3&7).
The locations of the mining zones are shown in Figure 9-6. It s hould be noted that Vein 86 is not
included in the Ore Reserve estimation due to its remote spatial location relative to other mines,
making its exploitation potentially unprofitable.
– IIIA-212 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1038 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Ore Reserve Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 151
Figure 9-6: Plan View of Mining Zones

Sources: SRK
9.2.2 Ore Resources Models
The Huatai Project resource block model was completed by SRK geologist in a *.mdl file format, and
it has been converted into *.dm file format for design and scheduling purposes.
9.2.3 Feasibility Study
SRK has reviewed the following preliminary design studies:
 Pengjiagou Preliminary Design by Chifeng Gaoda Engineering Desi gn Company in May 2018.
There are 2 veins named 65-2 and 2. The design has covered leve ls between 456m to 769m
with capacity of 30ktpa run-of mine (ROM).
 Honghuagou #1 Mining Zone Expansion Preliminary Design by Inner  Mongolia Mining Industry
Development Co., Ltd. in May 2013. There are 4 sections named L TS, YCFQ, SHMFQ and
SCFQ with 16 veins. The design has covered levels for each sect ion with a total capacity of
30.3ktpa ROM.
 Lianhuashan #5 Mining Zone Expansion Preliminary Design by Chifeng Zhenghang Design Co.,
Ltd. in November 2022. There are 4 veins named 51-1, 51-6, 51-8  and 51-10. The design has
covered 18 levels between 105m to 752m with a total capacity of 60ktpa ROM.
 Lianhuashan #26 Vein Preliminary Design by Chifeng Gaoda Engine ering Design Company in
May 2018. There are 2 veins named 1 and 2. The design has cover ed levels between 480m to
760m with capacity of 30ktpa ROM.
 Lianhuashan #3&#7 Vein Preliminary Design (Only 3-2 vein considered) by Chifeng Zhenghang
Design Co., Ltd. in July 2015. The design has covered levels be tween 700m to 820m with
capacity of 30ktpa ROM.
 Lianhuashan #3&#7 Vein Mineral R esources Development and Utiliz ation Scheme by Inner
Mongolia Geology and Mineral Technology Co., Ltd in December 2019. There are 3 veins named
– IIIA-213 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1039 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Ore Reserve Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 152
3-2, 8 and 8-2 considered in this scheme. The scheme has limite d its boundary for 8 and 8-2
within 470m level above, 3-2 within 745m level above because of  low geology confidence.
According to the scheme, the capacity of 3&7 is 60ktpa ROM.
9.2.4 Cut-off Grade
The unit cost of mining, processing, general and administrative, and processing recovery from 2020
to 2022 were provided by Huatai Mining, as detailed in Table 9- 5. The fiscal data for 2023 was not
collected due to ongoing technological upgrades during the year.
The cut-off grade is calculated to be 2.93g/t, based on the adjustment from average historical three-
year unit costs, while also considering processing recovery and  royalty factors, as shown in Table
9-6.
Table 9-5: Unit Cost of Huata i Project from 2021 to 2024 Q3
Item Unit 2021 2022 2023 2024 Q3
Mining Cost RMB/t Ore 732 939 - -
Processing Cost RMB/t Ore 151 188 586 -
G&A Cost RMB/t Ore 246 1,440 - -
Processing Recovery
for Au % 94 93 93 -
Sources: Client
Table 9-6: Cut-off Grade Calculation
Item  Unit Assumption
Au Price USD/oz 2,050
Au Price 1 RMB/g 476
Mining RMB/t ore  840
Processing  RMB/t ore 160
G&A2 RMB/t ore  246
Processing Recovery % 93
Royalty % 4
 Break-even Cut-off Grade % 2.93
Sources: SRK
1 The exchange rate of 7.22 USD to RMB was applied.
2 The G&A costs are unusually high, so SRK opted to use the G&A costs in 2021, which is more reasonable in the context of
the Huatai overall operating expenses.
9.2.5 Mining Dilution and Ore Loss
Mining dilution includes unplanned dilution from stope wall fai lures and overbreak from stope walls
and floors. Waste rock dilution primarily originates from material sloughing off the hanging wall, with
minor contributions from the ends and floors of the stoping are a. Waste dilution typically ranges
between 0.02m and 1m, depending on the size and shape of the orebodies.
– IIIA-214 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1040 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Ore Reserve Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 153
To estimate mining dilution, SRK has expanded the orebody wiref rame by 0.03 to 0.4m in all
directions (Pink line in Figure 9-7), creating skins as an equivalent linear overbreak slough. Overall,
it is estimated that mining dilution will be approximately 20%.
Additionally, a mining loss of 15% was estimated and applied to Ore Reserves.
Figure 9-7: Skin Analysis for Mining Dilution

Sources: SRK
9.2.6 Ore Reserve Estimates
The estimated process details are provided in Table 9-7, with t he corresponding waterfall charts
illustrated in Figure 9-8 and Figure 9-9.
Approximately 50% of tonnes and 43% of metal have been converte d from Mineral Resources to
Ore Reserve. Key negative factors affecting this conversion include the exclusion of Inferred Mineral
Resources and design boundaries.
Table 9-7: Estimated Process Summary
Conversion Process Tonnage (kt) Au Contained (t)
M+I+I Resources  3,378  24.45
Inferred Resource Exclusion (1,160) (8.34)
M+I Resources  2,218  16.11
Design Boundary (479) (3.00)
Irregular Shape  (38) (0.27)
COG Filter (57) (0.32)
Mining Dilution  358  (0.02)
Ore Loss (313) (1.99)
Ore Reserves  1,694  10.50
Sources: SRK
– IIIA-215 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1041 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Ore Reserve Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 154
Figure 9-8: Estimated Process - Change in Tonnes

Sources: SRK
Figure 9-9: Estimated Process - Change in Metal Contained

Sources: SRK
9.2.7 Ore Reserves Statement
SRK has estimated the Ore Reserve for the Huatai Project in compliance with the JORC Code. Ore
Reserves, with an effective date of 30 September 2024, is summarized in Table 9-8.
As of 30 September 2024, the total Ore Reserve for the Huatai Project is estimated at 1,694 kt at an
average grade of 6.20g/t Au, containing 10.50 t of gold. This i ncludes the Proved Ore Reserve
estimated at 226 kt at an average grade of 5.21g/t Au, containi ng 1.18 t of gold, and the Probable
Ore Reserve estimated at 1,468 kt at an average grade of 6.35g/t Au, containing 9.32 t of gold.
– IIIA-216 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1042 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Ore Reserve Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 155
Table 9-8: Huatai Project Underground Ore Reserve Statement, as  of 30 September 2024
Reserve
Category Tonnage (kt) Au Grade (g/t) Au Metal Contained (t) Au Metal Con tained (koz)
Proved 226 5.21 1.18  38
Probable 1,468 6.35 9.32  300
Total 3 1,694 6.20 10.50  338
Sources: SRK
Notes:
1 The information relates to Ore Reserve conversion is based on i nformation compiled by Mr. Erwei Lu and Dr. Yiefei Jia,
FAusIMM and a Chartered Professional in Geology (CP Geo), emplo yees of SRK Consulting China Ltd. Both Dr. Jia and
Mr. Lu have sufficient experience relevant to the style of mine ralisation and type of deposit under consideration and to the
activity which they are undertaking to qualify as Competent Per sons as defined in the JORC Code.  Dr. Jia supervised the
work of Mr. Lu.  Dr. Jia and Mr. Lu consent to the reporting of this information in the form and context in which it appears.
2 Ore Reserve are estimated at a cut-off grade of 2.93g/t Au;
3 Number was rounded to the second significant digit;
4 Total may not add due to rounding discrepancies; and
5 Mining dilution is 20% and ore loss is 15%.
9.3 Wulong Project
9.3.1 Introduction
Wulong Mining is actively operating and includes several deposi ts within its various mining zones,
specifically Zone 1 through Zone 5. Each of these zones is curr ently being exploited. The locations
of these mines, along with their respective veins, are detailed  in Figure 9-10, which has been
reviewed for the Ore Reserve estimation.
Figure 9-10: Plan View of Mining Zones of Wulong

Sources: SRK
– IIIA-217 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1043 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Ore Reserve Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 156
9.3.2 Mineral Resources Models
The Wulong Project resource block model was completed by SRK ge ologist in a *.mdl file format,
and it has been converted into *.dm file format for design and scheduling purposes.
9.3.3 Feasibility Study
SRK has reviewed the following preliminary design studies:
 Wulong #2 Mining Zone Preliminary Design by Shenyang Nonferrous  Metallurgy Design and
Research Institute in Feb 2022.
 Wulong #3 Mining Zone Preliminary Design by Shenyang Nonferrous  Metallurgy Design and
Research Institute in Feb 2022.
 Wulong #4 and #5 Mining Zone Preliminary Design by Shenyang Nonferrous Metallurgy Design
and Research Institute in Feb 2022.
9.3.4 Cut-off Grade
The unit cost of mining, processing, general and administrative, and processing recovery from 2021
to 2024Q3 were provided by Wulong Mining, as detailed in Table 9-9. The cut-off grade is calculated
to be 2.50g/t, based on the adjustment from average historical three-year unit costs, while also
considering processing recovery and royalty factors, as shown in Table 9-10.
Table 9-9: Unit Cost of Wul ong Project from 2021 to 2024Q3
Item Unit 2021 2022 2023 2024 Q1-Q3
Mining Cost RMB/t Ore 1,129  1,569  2,061  2,259
Processing Cost RMB/t Ore 76  97  94  85
G&A Cost RMB/t Ore 56  106  49  27
Processing Recovery for
Au  %  89  90  92  91
Sources: Client
1 The mining production and unit cost only include stope production.

Table 9-10: Cut-off Grade Calculation
Item  Unit  Assumption
Gold Price USD/oz 2,050
Gold Price 1 RMB/g 476
Mining 2 RMB/t ore  873
Processing RMB/t ore 89
G&A RMB/t ore  57
 Processing Recovery %  97
Payable Rate %  92
Royalty % 4
Break-even Cut-off Grade  %  2.50
Sources: SRK
1 The exchange rate of 7.22 USD to RMB was applied.
– IIIA-218 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Ore Reserve Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 157
2 The mining production and unit cost only include stope producti on. Since the mining contractor also mining remnants
extraction and haulaging low-grade ore, the mining cost has been factored and adjusted downward.
9.3.5 Mining Dilution and Ore Loss
Mining dilution includes unplanned dilution from stope wall fai lures and overbreak from stope walls
and floors. Waste rock dilution primarily originates from material sloughing off the hanging wall, with
minor contributions from the ends and floors of the stoping are a. Waste dilution typically ranges
between 0.04m and 0.2m, depending on the size and shape of the orebodies.
To estimate mining dilution, SRK has expanded the orebody wiref rame by 0.04m and 0.2m in all
directions (Grey line in Figure 9-11), creating skins as an equivalent linear overbreak slough. Overall,
it is estimated that mining dilution will be approximately 15%.
Additionally, a mining loss of 8% was estimated and applied to the Ore Reserve estimation.
Figure 9-11: Skin Analysis for Mining Dilution

Sources: SRK
9.3.6 Ore Reserve Estimates
The estimated process details are provided in Table 9-11, with the corresponding waterfall charts
illustrated in Figure 9-12 and Figure 9-13.
Approximately 42% of tonnes and 38% of metal have been converte d from Mineral Resources to
Ore Reserve. Key negative factors affecting this conversion include the exclusion of Inferred Mineral
Resources and design boundaries.
Table 9-11: Estimates Process Summary
Conversion Process Tonnage (kt) Au Contained (kg)
M+I+I Resources 2,368 18,997
– IIIA-219 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1045 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Ore Reserve Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 158
Conversion Process Tonnage (kt) Au Contained (kg)
Inferred Resource Deduction (1,371) (10,146)
Remained M+I Resources 997 8,851
Design Boundary 15 44
Irregular Shape (117) (993)
COG Filter (36) (72)
Mining Dilution 210 (20)
Mining Loss (86) (625)
Ore Reserves 984 7,185
Sources: SRK
Figure 9-12: Estimated Process - Change in Tonnes

Sources: SRK
Figure 9-13: Estimated Process - Change in Metal Contained

Sources: SRK
– IIIA-220 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1046 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Ore Reserve Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 159
9.3.7 Ore Reserve Statement
SRK has estimated the Ore Reserve for the Wulong Project in compliance with the JORC Code. The
Ore Reserve, with an effective date of 30 September 2024, is summarized in Table 9-12.
As of 30 September 2024, the total Ore Reserve for the Wulong Project is estimated at 984 kt at an
average grade of 7.30g/t Au, containing 7.19 t of gold.
Table 9-12: Wulong Project Underg round Ore Reserve Statement, as of 30 September 2024
Reserve
Category Tonnage (kt) Au Grade (g/t) Au Metal Contained (t) Au Metal Con tained (koz)
Proved - - -
Probable 984 7.30 7.19 231
Total 3 984 7.30 7.19 231
Sources: SRK
Notes:
1 The information relates to Ore Reserve conversion is based on information compiled by Ms. TzuHsuan Chuang, MAusIMM
and Dr. Yiefei Jia, FAusIMM and a Chartered Professional in Geology (CP Geo), employees of SRK Consulting China Ltd.
Both Dr. Jia and Ms. Chuang have sufficient experience relevant  to the style of mineralisation and type of deposit under
consideration and to the activity which they are undertaking to qualify as Competent Persons as defined in the JORC Code.
Dr. Jia supervised the work of Ms. Chuang.  Dr. Jia and Ms. Chuang consent to the reporting of this information in the form
and context in which it appears;
2 The Ore Reserves Statement is based on the depletion data provided by Wulong Mine for the six-month period, 1 April 2024
to 30 September 2024. The reported Wulong Mine data may differ from that reported by SRK, due the updated Block model
now used by Wulong Mine for repor ting. SRK considers this updat ed block model to be more representative of actual
production conditions and has therefore adopted the Wulong Mine provided data as the basis for this statement.
3 Ore Reserve are estimated at a cut-off grade of 2.50g/t Au;
4 Number was rounded to the second significant digit;
5 Total may not add due to rounding discrepancies; and
6 Mining dilution is 20% and ore loss is 8%.
9.4 Hanfeng Project
9.4.1 Introduction
Hanfeng Project is actively operating and includes several deposits within the following mining zones:
 Lishan Lower Part (Stage1- levels between -92m to -373m);
 Lishan Lower Part (Stage2- levels between -373m to -700m);
 Dongfeng Lower part.
It should be noted that only Lishan Lower Part (Stage1) is included in Ore Reserves since there are
no sufficient technical studies regarding the Lishan Lower Part (Stage 2) and Dongfeng Lower part.
In order to classify as Proved or Probable Ore Reserve category , technical studies need to be
completed to at least a PFS level with an appraisal of how acce ss would be achieved, mining
methodology (including extraction and dilution factors), the ge otechnical understanding as well as
ventilation. Along with the technical understanding and extract ion achievability, the economics of
each area needs to be proved, i.e. with the application of Cape x and Opex, is it economic to mine,
cash flow positive.
– IIIA-221 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Ore Reserve Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 160
In addition, the Dongfeng Molybdenum Mine is expected to begin construction in 2025. Currently,
the mine is preparing the feasibility study report. The projected annual mining capacity is 1.65 million
tons per year, using underground mining methods, with an annual  production of 3,990 tons of
molybdenum concentrate at 47% Mo content. The estimated life of mine is 33 years.
9.4.2 Mineral Resources Models
The Hanfeng Project resource block model was completed by SRK g eologist in a *.mdl file format,
and it has been converted into *.dm file format for design and scheduling purposes.
9.4.3 Feasibility Study
SRK has reviewed the following preliminary design studies:
 Lishan Lower Part (Stage1) Preliminary Design (“ Lishan LS1 ”) by Changchun Gold Design
Institute in Dec. 2021 with capacity of 435ktpa ROM
9.4.4 Cut-off Grade
The unit cost of mining, processing, general and administrative, and processing recovery from 2021
to 2024 Q3 were provided by Hanfeng Mining, as detailed in Tabl e 9-13. The cost data is extracted
from operational zinc mine, which is Lishan Mine Upper and the Dongfeng Mine Upper South.
The cut-off grade for Lishan Lower Part is calculated to be 1.42% Zn, based on the adjustment from
average historical three-year unit costs, while also considerin g processing recovery factors, as
shown in Table 9-14.
Table 9-13: Unit Cost of Lishan Upper Part and the Dongfeng Upp er South from 2021 to 2024
Q3
Item Unit 2021 2022 2023 2024 Q3
Mining Cost RMB/t Ore 94  115  129 112
Processing Cost RMB/t Ore 58 61 67 67
G&A Cost RMB/t Ore 31  22  42 32
Processing Recovery for Zinc % 87 88 89 88
Sources: Client
1 The mining production and unit cost is extracted from Lishan Upper Part and the Dongfeng Upper South.
Table 9-14: Zinc Cut-off Grade Ca lculation of Lishan Lower Part
Item  Unit Assumption
Zinc Price 1 USD/t 2,500
Zinc Price 2 RMB/t  18,050
Underground Mining RMB/t ore 77
Processing RMB/t ore 63
Processing Recovery % 88
G&A RMB/t ore  25
– IIIA-222 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Ore Reserve Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 161
Item  Unit Assumption
Payable Rate %  76
Royalty % 4
Cut-off Grade  %  1.42
Sources: SRK
1 CMF price in Q1, 2024 was used for cut-off estimation.
2 The exchange rate of USD to RMB at 7.22 was applied.
3 The cut-off grade is applied to Lishan Lower Part, therefore the cost is adjusted.
9.4.5 Mining Dilution and Ore Loss
Lishan Lower Part (Stage1) contains various stopes based on horizontal width of the stopes. Mining
dilution includes unplanned dilution from stope wall failures and overbreak from stope walls and floors.
Waste rock dilution primarily originates from material sloughing off the hanging wall, with minor
contributions from the ends and floors of the stoping area. Was te dilution typically ranges between
0.2 m and 1.0 m, depending on the size and shape of the orebodies.
To estimate mining dilution, SRK has expanded the orebody wireframe by 0.2 m and 1.0 m in all
directions (Orange line in Figure 9-14), creating skins as an e quivalent linear overbreak slough.
Overall, it is estimated that mining dilution will be approximately 22%.
Additionally, a mining loss of 20% was estimated and applied to the Ore Reserve estimation.
Figure 9-14: Skin Analysis for Mining Dilution

Sources: SRK
9.4.6 Ore Reserve Estimates
The estimated process details are provided in Table 9-15, with the corresponding waterfall charts
illustrated in Figure 9-15 and Figure 9-16.
Approximately 17% of tonnes and 15% of metal have been converte d from Mineral Resources to
Ore Reserve. Key negative factors affecting this conversion include the exclusion of Inferred Mineral
Resources and design boundaries.
– IIIA-223 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Ore Reserve Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 162
Table 9-15: Estimated Process Summary
Conversion Process Tonnage (kt) Zn Contained (t)
M+I+I Resources 19,951 553,966
Inferred Resource Deduction (10,623) (307,867)
M+I Resources 9,328 246,099
Design Boundary (4,411) (113,683)
Irregular Shape (355) (10,331)
COG Filter (1,348) (21,416)
Mining Dilution 923 604
Mining Loss (828) (20,255)
Ore Reserves 3,310 81,019
Sources: SRK
Figure 9-15: Estimated Process - Change in Tonnes

Sources: SRK
– IIIA-224 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Ore Reserve Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 163
Figure 9-16: Estimated Process - Change in Metal Contained

Sources: SRK
9.4.7 Ore Reserve statement
SRK has estimated the Ore Reserv e for the Hanfeng Project in co mpliance with the JORC Code.
The Ore Reserve, with an effective date of 30 September 2024, is summarised in Table 9-16.
As of 30 September 2024, the total Ore Reserve for the Hanfeng Project (Lishan Lower Part - Stage1)
is estimated at 3,310 kt at an average grade of 2.45% Zn, conta ining 81 kt of Zn. This includes the
Proved Ore Reserve estimated at 390 kt at an average grade of 2.26% Zn, containing 9 kt of Zn, and
the Probable Ore Reserve at 2,920 kt at an average grade of 2.47% Zn, containing 72 kt of Zn.
Table 9-16: Hanfeng Project Underground Ore Reserve Statement, as of 30 September 2024
Reserve
Category Tonnage (kt) Zn Grade (%) Zn Metal Contained (kt)
Proved 390 2.26 9
Probable 2,920 2.47 72
Total 3,310 2.45 81
Sources: SRK
Notes:
1 The information relates to Ore Reserve conversion is based on i nformation compiled by Mr. Erwei Lu and Dr. Yiefei Jia,
FAusIMM and a Chartered Professional in Geology (CP Geo), emplo yees of SRK Consulting China Ltd. Both Dr. Jia and
Mr. Lu have sufficient experience relevant to the style of mine ralisation and type of deposit under consideration and to the
activity which they are undertaking to qualify as Competent Per sons as defined in the JORC Code.  Dr. Jia supervised the
work of Mr. Lu.  Dr. Jia and Mr. Lu consent to the reporting of this information in the form and context in which it appears.
2 Ore Reserve are estimated at a cut-off grade of 1.42% Zn;
3 Number was rounded to the second significant digit;
4 Total may not add due to rounding discrepancies; and
5 Mining dilution is 22% and ore loss is 20%.
– IIIA-225 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
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Ore Reserve Estimates    Final
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9.5 Jintai Project
9.5.1 Introduction
Jintai Project is actively operating and includes several deposits within its various mining zones:
V1, V2 (V2_1, V2_2), V4, V5, V6, V7, V8, V9, and V10
It should be noted that only V1, V2, V4 and V10 have measured r esource and indicated resource,
but only V1 and V2 are included in Ore Reserves since there are  no sufficient technical studies for
the rest of mining zones.
9.5.2 Mineral Resources Models
The Jintai Project resource block model was completed by SRK geologist in a *.mdl file format, and
it has been converted into *.dm file format for pit optimization, design, and scheduling purposes.
9.5.3 Feasibility Study
SRK has reviewed the following preliminary design studies:
 Preliminary Design for Xidengping Mine with a capacity of 140kt pa ROM conducted by Jinjian
Engineering Design Co., Ltd. (“GOCOM”) in February 2022 (“FS 2022”).
 Xidengping Mine Mineral Resources Development and Utilization S cheme with a capacity of
650ktpa conducted by Yunnan Shangli Mining Co., Ltd. (“Shangli”) in March 2024 (“FS 2024”).
9.5.4 Cut-off Grade
Economically mineable ore was defined based on the results of o pen pit optimization. Open pit
optimization was used to identify the optimum economic pit shape based on the highest project cash
flow. The cut-off grade (“COG”) of gold is defined the destination for material within desig ned pit. If
the material that has a grade more than COG, these materials wo uld truck to the draw-point of mill
plant, otherwise would be dump into WRD.
The inputs were applied by SRK to estimate MCOG of gold ore, which are presented in Table 9-17.
Table 9-17: Estimates of MCOG for Gold Ore
Inputs Unit Parameter
Mining cost RMB/t TMM 11
Heap leaching RMB/t ore feed 45
G&A cost RMB/t ore feed 31
Recovery Rate Percentage 78
Payable Rate Percentage 97
Gold Price USD/ oz 2,050
Exchange Rate RMB/USD 7.22
Royalty % 4
– IIIA-226 –
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Ore Reserve Estimates    Final
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Inputs Unit Parameter
Gold Price RMB/g 476
Cut-off Grade g/t 0.25
Sources: SRK
The COG is estimated to be 0.25g/t Au. SRK is of the view that material within pit has more than
0.25g/t Au can be processed economically, and reserves at COG will have positive revenues.
The COG was calculated based on technical and economic assumpti ons described in the Table
above. These assumptions may cha nge in the future, which will a ffect the COG calculation, which
will impact the mine inventory estimation.
9.5.5 Modifying Factors
The following modifying factors are used to determine the mine inventory.
 Optimal pit shell: Includes the economic pit limits to the vein  domains and excludes resources
outstanding mining license or road limit as mining ‘no-go’ area.
 Pit design: The conversion factor for the mining inventory between the optimized pit shell and the
practical mine design has been accounted for in this parameter.
 Dilution: Mining dilution is estimated as 5% by FS 2022. The modifying factor would be updated
when more experience parameters were gained during pilot and operation reconciliation data.
 Mining recovery: A 95% mining recovery rate was applied by FS 2022 and similar as dilution rate,
updates would be applied when more data obtained.
9.5.6 Ore Reserve Estimates
The estimated process details are provided in Table 9-18, with the corresponding waterfall charts
illustrated in Figure 9-17 and Figure 9-18.
Approximately 49% of tonnes and 33% of metal have been converte d from Mineral Resources to
Ore Reserve. Key negative factors affecting this conversion include the exclusion of Inferred Mineral
Resources.
Table 9-18 Estimated Process Summary
Conversion Process Tonnage (kt) Au Metal Contained (t)
M+I+I Resources  2,772   3.10
Inferred Resource (769)  (1.55)
M+I Resources 2,004  1.55
Design Boundary  (81)  (0.04)
Pit Optimization (161)  (0.03)
Detailed Design  (388)  (0.40)
Mining Dilution 69  -
Mining Loss  (72)  (0.05)
Ore Reserves 1,370  1.03
– IIIA-227 –
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Ore Reserve Estimates    Final
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Sources: SRK
Figure 9-17: Estimated Process - Change in Tonnes


Sources: SRK
Figure 9-18: Estimated Process - Change in Metal Contained


Sources: SRK
9.5.7 Ore Reserve Statement
SRK has estimated the Ore Reserve for the Jintai Project in com pliance with the JORC Code. The
Ore Reserve, with an effective date of 30 September 2024, is summarized in Table 9-19.
– IIIA-228 –
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Ore Reserve Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 167
As of 30 September 2024, the total Ore Reserve for the Jintai Project (V1&V2) is estimated at 1,370
kt at an average grade of 0.75 g/t Au, containing 1.03 t of gold.
Table 9-19 Open Pit Mineral Ore Reserve Statement of Jintai Pro ject, as of 30 September
20241,2,3,5
Reserve
Category Tonnage (kt) Au Grade (g/t) Au Metal Contained (t) Au Metal Con tained (koz)
Proved  -     -     -     -
Probable  1,370   0.75   1.03   33
Total 4  1,370   0.75   1.03   33
Sources: SRK
Notes:
1 The information relates to Ore Reserves conversion is based on information compiled by Mr Erwei Lu, Mr. Falong Hu,
MAusIMM, and Dr. Yiefei Jia, FAusIMM and a Chartered Professional in Geology (CP Geo), employees of SRK Consulting
China Ltd. Both Dr. Jia and Mr. Hu have sufficient experience r elevant to the style of mineralisation and type of deposit
under consideration and to the activity which they are undertaking to qualify as Competent Persons as defined in the JORC
Code.  Mr Lu, Mr Hu and Dr. Jia consent to the reporting of this information in the form and context in which it appears.
2 Ore Reserve are estimated at a cut-off grade of 0.25g/t Au;
3 Number was rounded to the second significant digit;
4 Total may not add due to rounding discrepancies;
5 Mining dilution is 5% and ore loss is 5%; and
The Ore Reserves Statement is based on the depletion data provi ded by Jintai for the six-month period, 1 April 2024 to 30
September 2024. The reported Jintai data may differ from that reported by SRK, due the updated block model now used by
Jintai for reporting. SRK considers this updated block model to be more representative of actual production conditions and
has therefore adopted the Jintai provided data as the basis for this statement.
– IIIA-229 –
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Mining Assessment    Final
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10 Mining Assessment
10.1 Jilong Project
10.1.1 Introduction
Jilong Gold Mine now has three stand-alone underground operatin g systems: Zone 1, Zone 2, and
Zone 3. Zone 1 is located on the southwest side of the mine, including No. 27 area and Yangpo area.
Zone 2 (also known as Huangjindong) is located on the north side of Zone 1. Zone 3 (also known as
Luofengmao) is located on the east side of Zone 1. All of these  zones are utilizing underground
mining method, accessing the orebody via shafts or adits.
Jilong Gold Mine intends to increase its production capacity by developing peripheral Zones 4, 5, 6,
and 7. This expansion is projected to commence operations in 20 27, with an expected production
rate of 60 ktpa.
In addition, the mine is expected to build a processing plant in June 2024 with a capacity of 180 ktpa,
combining with the existing processing capacity of 120 ktpa to total 300 ktpa. The mining capacity
will increase to 300 ktpa by the end of 2025 due to deeper mini ng and the expansion of the mining
zone, which will match the capacity of the processing plant.
10.1.2 Geotechnical and Hy drogeological Conditions
Visually, the geotechnical and hydrogeological conditions of Ji long Project, where SRK visited, are
fair to good. The rock underground appears competent, and the drifts are mostly unsupported. Local
support by wood or steel arcs is necessary where small faults cross the drift.
The tunnels back and walls are dr y, and the water on floor is m inimum, collecting at the ditch then
staged pumps to water tanks close to the adit exits.
SRK opines that both geotechnical and hydrogeological risks are  medium to low as the available
data and the site views
10.1.3 Mining Method
The Jilong Mine mainly adopted the resuing method since the ore body is very steep and thin with
solid surrounding wall rocks. Since the vein's thickness is so thin and the void area so small, miners
cannot work within the vein during mining. However, if the waste is removed all at once, the depletion
is too high, raising transportation and processing expenses, which is not economically feasible. As a
result, this mining method enables the separation of the ore an d surrounding rocks, with the ore
being transported and extracted while the waste is kept in the stope for backfilling. (See Figure 10-1)
The vein's width is so small that a section of the surrounding rock must be blasted to create a
minimum working width, hence the stope's width is crucial. Every effort should be made to limit the
mining of waste rock because it is an unprofitable operation.
– IIIA-230 –
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Mining Assessment    Final
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Figure 10-1: Resuing Method

Source: Design from a PFS level of study (2018)
The mining process is to lay the rubber pad, blast the ore, ventilate, skid the roof support, carry the
ore to the chute by hand with rubber pad, withdraw the rubber pad, reuse, level the working platform,
and set up the ore chute to the next operation cycle.
Materials Movement and Handling
Electric locomotives are used for transportation to haul ore an d waste rocks, and wooden sleeper
light rails are laid in the mine (Figure 10-2). The ore is lifted to the surface by shafts with double-deck
cages, unloaded to the stockpile and transported by trucks to the processing plant.
Figure 10-2: Mine cart in the underground

Source: Site visit on 31st May 2024
– IIIA-231 –
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10.1.4 Production
History Production
In Zone 1, Zone 2, and Zone 3, the current mining stope operation produces approximately 76 ktpa
of ore per with an average gold grade of 10.99g/t . Table 10-1 shows the historical stope production
in the last three years.
Table 10-1: Jilong Mine Yearly S tope Production from 2021 to 2024 Q3
Item Unit 2021 2022 2023 2024Q1 – Q3
Ore Tonnes kt 62 57 85 98
Au Grade g/t 13.11  14.90 11.41 7.02
Au Metal kg 813  853  967  688
The Jilong Mine contains mineralized waste rock, development ma terials, residues in stopes, and
low-grade stockpiles both undergr ound and on the surface. Resid ues are the stopes that the prior
old mine regarded low-grade with no value. The stockpile is low -grade ores from the prior old mine
with an Au grade of less than 3g/t, which was heaped in the drift rather than being transferred to the
processing plant.
With the recent increase in gold prices, these materials have g ained economic value and are now
considered as ROM material for comprehensive utilization in mining operations. The mine has begun
to haul the low-grade stope and transport the stockpile of previously low-grade ore to the processing
plant. Table 10-2 shows the historical production for comprehensive utilization in the last three years.
Table 10-2: Jilong Mine Yearly Production for comprehensive uti lization from 2021 to 2024
Q3
Item Unit 2021 2022 2023 2024Q1 – Q3
Ore Tonnes kt 76 96 70 63
Au Grade g/t 3.44  2.02  4.70  5.77
Au Metal kg 263  194  328  361
Mine Design and Access
The stope's length is 50 m, and its height is 40-45 m. Wooden hopper is used, and the ore is
transported manually. The distance between hopper is 10m, the sill pillar is 3 m, and no pillar is left.
There are raises beside the st ope, and the section of the raise  is 2.0m × 1.5m. The drift section is
about 2.4m × 2.5m depending on the orebody. SRK notes that most of the drifts are solid enough to
not to be supported. A few of the drifts with weak surrounding rocks need to support with shotcrete.
Figure 10-3 shows the design of the shaft, which is used in every zone in Zhuanshanzi Mine. There
are different types of orebody access which is shown in Table 10-3. Table 10-4 shows the purpose
of each development in each zone.
Table 10-3: Type of Access in Each Zone
Zone Type of orebody access
Zone 1 Vertical shaft and Blind shaft
– IIIA-232 –
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Mining Assessment    Final
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Zone Type of orebody access
Zone 2 Adit and Vertical shaft
Zone 3 Vertical shaft
Zone 4 Vertical shaft
Zone 5 Vertical shaft
Zone 6 Vertical shaft
Zone 7 Vertical shaft
Source: Summarized from a PFS level of study (2018) and PFS level of study (2024)
Figure 10-3: Design of Shaft

Source: Shaft design from a PFS level study (2018)
Table 10-4: Development System in Each Zone
Zone Development Purpose
Zone 1
Yangpo Shaft Transport for people, equipment, ore and waste; Downcast
Yangpo Blind Shaft Transport for people, equipment, ore and waste; Downcast
No. 27 Shaft Transport for people, equipment, ore and waste; Downcast
No. 27 Blind Shaft Transport for people, equipm ent, ore and waste
No. 72 Blind Shaft Transport for people, equipm ent, ore and waste; Downcast
No. 1 Ventilation Shaft Upcast
No. 3 Ventilation Shaft Upcast
– IIIA-233 –
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Mining Assessment    Final
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Zone Development Purpose
Zone 2
Adit Transport for people, equipment, ore and waste; Downcast
Huangjindong Shaft Transport for people, equipment, ore and waste; Downcast
Blind Shaft Transport for people, equipment, ore and waste; Downcast;
Ventilation Shaft Up cast; Emergency exit
Zone 3
Luofengmao Shaft Transport for peop le, equipment, ore and waste; Downcast
Blind Shaft Transport for people, equipment, ore and waste; Downcast
Inclined Shaft Upcast
Ventilation Shaft Upcast
Source: Summarized from a PFS level of study (2018)
10.1.5 Underground Service
Ventilation
The air flows down the mine to the working places and levels from shafts and downcasts, and then
is discharged through upcasts. The studies had designed the air  flow in 2D diagram (Figure 10-4)
and had estimated the air volume required for each zone individually.
During the site visit, SRK observed that the ventilation was sa tisfactory and did not present any
potential hazards.
Figure 10-4: Example of Ventila tion Design in Jilong Mine (Zone 1 to Zone 3)

Source: Design from a PFS level of study (2018)
Dewatering
In its current configuration, the mine utilizes a two-stage drainage system. First, water from the drifts
drains into a sump, and then water is pumped by pumping stations to a surface pond.
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During the site visit, SRK observed that the drainage was satis factory and did not present any
potential hazards.
Air Compressor
There is an air compressor station near the wellhead, and the air leg is the drilling equipment. The
analysis demonstrates that the co mpressed air delivery system s atisfies the majority of production
requirements. A comprehensive calculation of air consumption an d the selection and amount of air
compressors is included in a PFS-level research study (2018).
10.1.6 Mining Equipment
The mining equipment in each zone is shown in Table 10-5 to Table 10-7.
Table 10-5: Mine Equipment in Zone 1
Zone 1
Equipment Model Quantity Power (kw)
Jackleg YT28 48
Jackleg YSP45 12
Fan JK58-1- No.3.5 8 3
Fan JK58-1-No.4 8 5.5
Hoist 2JK2.5×1.5/11.5 1 280
Hoist 2JK2.5×1.5/20 3 315
Hoist 2JK3.0×1.5/20 1 450
Hoist 2JK2×1/20 1 200
Hoist GK2×1.6×0.9/24 1 115
Air compressor BLT350A-VFC/1.0 1 250
Air compressor BLT350A-1.0 1 250
Air compressor BLT175A-20.5/1.0 2 132
Air compressor LG-40/8G 1 250
Cage Double-decks 1
Cage Double-decks 7
Skip FJD3.2(7) 1
Mine cart YFC0.5（6） 100
Main Fan FKZ(K40-4) №12 3 37
Main Fan FKZ(K40-4) №11 1 30
Auxiliary Fan K40-4-8 16 5.5
Pump D85-67×7 3 200
Pump D46-50×10 3 110
Pump D46-50×12 9 132
Pump D46-50×9 3 110
Trolley electric locomotives CJY3/6G 26 13
Source: Summarized from a PFS level of study (2018)
Table 10-6: Mine Equipment in Zone 2
Zone 2
Equipment Model Quantity Power (kw)
Jackleg YT-28 11
Jackleg YSP-45 11
– IIIA-235 –
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Zone 2
Equipment Model Quantity Power (kw)
Fan JK58-1№3.5 6 3
Hoist 2JTP1.6×0.9-24 1 115
Hoist 2JK-2×1.25 1 110
Air compressor BLT175A-20.5/1.0 1 132
Air compressor 3L-10/8 1 75
Pump D25-30×8 3 37
Pump D25-50×8 3 75
Main Fan K45-4-8 1 7.5
Mine cart YFC0.7m3 40
Source: Summarized from a PFS level of study (2018)
Table 10-7: Mine Equipment in Zone 3
Zone 3
Equipment Model Quantity Power (kw)
Jackleg YT-28 11
Jackleg YSP-45 11
Fan JK58-1№3.5 6 3
Hoist 2JK-2.0×1.0 1 155
Pump D12-25×12 3 110
Mine cart YFC0.5m3 60
Source: Summarized from a PFS level of study (2018)
10.1.7 Production Schedule
The mine schedule was developed using Deswik software, based on productivity estimates for each
task. For instance, stope excavation requires several days for preparation. The assumptions for
mining sequence and dependencies are as follows:
 Mining and Processing Operation: The ROM capacity remains at 18 0 ktpa, with Zones 4, 5, 6,
and 7 scheduled to operate in 2027.
 Vertical Overlap: Mining progresses downward, level by level, w ith typically 3-4 levels grouped
into one section for better operational flexibility.
 Horizontally Overlap: Mining advances from the hanging wall to the footwall.
 Priority: Stopes accessible via existing development will be mined first.
 Life of Mine: 9 years.
The development schedule is not considered, as the mine has bee n previously operational and
further development is not seen as high-risk. Mining activities are expected to last approximately nine
years. Zones 4, 5, 6, and 7 are new to Jilong Mining, and with the existing infrastructure in Zones 1,
2, and 3.
Figure 10-5 illustrates the production schedule, detailing both  the ROM production and the ROM
grade. Table 10-8 provides the details of mine production.
– IIIA-236 –
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Figure 10-5: Production Schedule

Sources: SRK
Notes:
6 The line represents the average gold grade, corresponding to the right axis.
7 The column represents the ore amount, corresponding to the left axis.
Table 10-8: Production Schedule
Total Unit LoM 2024 Q4 2025 2026 2027 2028 2029 2030 2031 2032
Total Tonnes Mined kt 919 88 184 180 194 109 58 55 38 13
Au grade g/t 8.73 8.88 7.44 6.54 7.67 9.18 12.11 13.09 15.09 16.12
Contained Au koz 258 25 44 38 48 32 23 23 18 7
Zone 1
Total Tonnes Mined kt 353 69 131 84 38 31 - - - -
Au grade g/t 7.24 8.67 7.13 6.84 6.21 5.61 - - - -
Contained Au koz 82 19 30 19 8 6 - - - -
Zone 2
Total Tonnes Mined kt - - - - - - - - - -
Au grade g/t - - - - - - - - - -
Contained Au koz - - - - - - - - - -
Zone 3
Total Tonnes Mined kt 276 20 52 96 93 15 - - - -
Au grade g/t 6.41 9.13 8.24 6.27 5.25 3.91 - - - -
Contained Au koz 57 6 14 19 16 2 - - - -
Zone 5
Total Tonnes Mined kt 5 - - - 5 - - - - -
Au grade g/t 8.94 - - - 8.94 - - - - -
Contained Au koz 1 - - - 1.3 - - - - -
Zone 6
Total Tonnes Mined kt 184 - - - 36 45 34 28 28 13
Au grade g/t 13.82 - - - 12.57 12.7 12.51 14.92 16.55 16.12
Contained Au koz 82 - - - 15 18 14 14 15 7
– IIIA-237 –
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Total Unit LoM 2024 Q4 2025 2026 2027 2028 2029 2030 2031 2032
Zone 7
Total Tonnes Mined kt 102 - - - 23 19 25 26 10 -
Au grade g/t 11.37 - - - 12.06 10.93 11.57 11.1 10.79 -
Contained Au koz 37 - - - 9 7 9 9 3 -
Sources: SRK
10.2 Huatai Project
10.2.1 Introduction
Huatai Project includes six (6) gold mines, each with an independent development system. They are
all utilizing or planning conventional underground mining metho dologies, access via adit & shaft or
incline shaft, resuing stoping me thod, railway ore car transpor tation. Huatai Project operation and
plan status are described as follows:
 Pengjiagou Mine: the mining license (30ktpa) was obtained in 20 15. The client conducted a
preliminary design on this mine, decided to commend its production in 2028.
 Honghuagou #86 Vein: the mining license limits capacity of 30ktpa as the same as Pengjiagou,
the client decided to delay construction on this mine.
 Honghuagou #1 Mining Zone: this mine contained 4 sub-zones with  their own mining license,
which are #1 vein, #3 sub-zone, #1 sub-zone, and Longtoushan . The client conducted a
preliminary design on these sub-zones, decided to commend its production in 2027.
 Lianhuashan #26 Vein: the mining license limits capacity of 30ktpa as similar as the Pengjiagou
and #86. The client conducted a preliminary design on this mine , decided to commend its
production in 2028.
 Lianhuashan #3&#7 Vein: the mining license is also 60ktpa capacity. The client conducted a
scoping studies and preliminary design on this mine, decided to commend its production in 2027.
 Lianhuashan #5 Mining Zone: this mine has also decided to modify mining system to achieve the
capacity of 60ktpa from the previous 30ktpa. The client conduct ed a preliminary design on this
mine, decided to commend its production in 2026.
10.2.2 Geotechnical and Hy drogeological Conditions
Visually, the geotechnical & hydrogeological conditions of Lianhuashan #5 Zone, where SRK visited
are fair to good. The rock  underground appears competent, and the drifts are mostly unsupported.
Local support by wood or steel arcs is necessary where small faults cross the drift.
The tunnels back and walls are dr y, and the water on floor is m inimum, collecting at the ditch then
staged pumps to water tanks close to the adit exits.
SRK opines that both geotechnical and hydrogeological risks are  medium to low as the available
data and the site views.
– IIIA-238 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mining Assessment    Final
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10.2.3 Mining Method
Huatai Project using a modified resuing stoping method, named slice and fill with rock, for all stopes
of mining zones, and planned to use this method for the rest Mineral Resources in future.
The stoping method is suitable for the veins horizontal thickness is less than 0.8m. the mining cycle
is from the footwall waste mining, to give a space for miner operation to drill ore blasting holes. Then
mine the ore down to the pad at the bottom of slice. The broken ore will be cleaned into artificial ore
pass within the stope down to the draw point for ore car collec tion. Then fill the slice with rock from
development heading on upper levels via raises, or mine footwal l rock down to perform the work
platform for miners to drill the next lift. The modifying point from traditional resuing is the rock sourced
out of stope partly, not all from surrounding rock mined down.
The stope length is about 50 to 100m and the height is the same as level interval. There are no crown
pillar or rib pillar planned, the sill pillar is proposed for draw point installation and separation stopes.
The square-set raise for manway is planned at each end of stope. The draw points interval is about
10m middle to middle.
10.2.4 Production
Historical Production
The current mining operation has been suspended due to technica l upgrade and expansion. Table
10-9 below displays the historical production records.
Table 10-9: Huatai Project Yearly Ore Production from 2020 to 2 023
  Unit 2021 2022 2023 2024Q1 – Q3
Ore Tonnes kt 53 17 - -
Au Grade g/t 2.28 1.80 - -
Au Metal kg 121 31 - -
Sources: Client
Mine Design and Access
As for Lianhuashan #5 Zone, the underground mine is accessed vi a 3 staged shafts from surface
down to Level 18, as followings:
 Stage I: adit and incline shaft, serving the first 5 levels, the Mineral Resources on these 5 levels
are nearly depleted.
 Stage II: a blind caged shaft from Level 5 down to Level 12 as the main access to these levels.
The resources on these levels have been mined in recent years.
 Stage III: a third shaft have been established to serve the Lev el 12 down to Level 18. The
resources on these levels are the key mining target supporting the production expansion plan.
The broken ore from the stopes is loaded into ore cars from the  draw point at the sill of stope.  The
ore cars are hauled by locomotive via the level drift to shaft station at the level access. The ore is
then relayed hoisted to surface by the hoisting system in the shafts.
– IIIA-239 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mining Assessment    Final
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The waste rock from development headings is backfilled into mined stope.
All personnel and materials are transported in and out of the m ine via the staged shafts and level
drifts. The level interval is about 40m height, totally 18 levels have been established. The main adit
portal and shaft station of level 5 are shown in Figure 10-6, t he typical level drift and crosscut drift
are shown in Figure 10-7.
Figure 10-6: Photos of Main Adit Portal and Shaft Station on Le vel 5

Sources: shot during site visit on 25th Dec 2022
Note: Exit Adit of Lianhuashan #5 Zone (left) and Stage II Shaft Station on Level 5 (right)
Figure 10-7: Photos of Typical L evel Drift and Cross Cut Drift of Lianhuashan #5 Zone


Sources: shot during site visit on 25th Dec 2022
Note: Typical Level Drift on Level 5 (left) and Typical Cross-cut Drift on Level 8 (right)
– IIIA-240 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mining Assessment    Final
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Other Mining Zones
As previously described, similar to the Lianhuashan #5 Zone, all other sub-zones are either currently
utilizing or planning to utilize conventional underground minin g methodologies. Concurrently,
preliminary designs for all sub-zones have been conducted in accordance with Chinese Standards.
Along with historical operation records, SRK considers these de signs to be pre-feasible for guiding
Ore Reserves estimation.
10.2.5 Underground Service
Ventilation system, water supply compressed air supply, drainage, and power supply system for #5
Zone is established, and the expansion construction is ongoing.  For the Lianhuashan #1 Zone and
Lianhuashan #3&#7 Vein, the expansion construction and technica l updates are planned to be
completed by the end of 2026. For the Pengjiagou and Lianhuashan #26 Vein, the construction is
scheduled to be completed in 2029. The expansion plan consists of development system update,
machinery purchase and installation, drift renew and re-rail or enlarge the cross-section size, as well
as update the service system to fit the enlarged capacity from 30ktpa to 60ktpa.
The level 5 staged sump of #5 Zone and the main power substation underground is shown in Figure
10-8 below.
Figure 10-8: Photos of Level 5 Sump and Main Power Substation of Lianhuashan #5 Zone

Sources: shot during site visit on 25th Dec 2022
Note: Level Sump of # 5 Zone (left) and Main Power Substation on Level 5 (right)
10.2.6 Mining Equipment
The mining equipment in each zone is shown in Table 10-10.
– IIIA-241 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mining Assessment    Final
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Table 10-10 Main Mine Equi pment for Huatai Project
#5 Mining Zone
Equipment Model Quantity  Power (kw)
Cage GLM1/6/2/2 4
Cage GDG1/6/2/2 2
Compressor LG-13/8G 1 75
Compressor LG-1 .5/8 3 55
Electric
Locomotives CTY2.5-6GB 3 4
Hoist 2JK2×1/2  2 2
Hoist 2JK2.5×1.2 1 28
Hoist JKM-2.25×4 1 28
Jackleg YT-28 4
Jackleg YSP-45 2
Main Fan FKCDZ No.13/2×37 1 2×37
Material Trolley 3
Pump D46-5 ×5 3 55
Pump D46-5 ×7 6 9
Pump D46-5 ×1  3 132
Secondary Fan FBY No. 5. 8 11
#3&#7 Vein
Equipment Model Quantity Power (kw)
Cage YJGG-1.8-2 3
Compressor LG-20/8 3 110
Electric
Locomotives ZK3-250/6 6 13
Hoist 2JK-2/30A 1 153
Hoist 2JK-3/30A 1 355
Loading Machine Z-17AW 12 21
Main Fan K40-4-11 2 30
Pump D25-30×6 3 30
Pump D25-50×11 3 90
Pump D45-50×7 3 75
Secondary Fan YBT52-2 12 11
#26 Vein
Equipment Model Quantity Power (kw)
Cage YJGG-1.8-1 1
Compressor EX-132A
22.5m3/min 2 132
Electric
Locomotives CTY2.5/6G 3 4
Hoist 2JK-2/20A 1 215
Jackleg YT-28 8
Jackleg YSP45 4
Loading Machine Z-17A 3 21
Main Fan FKZ-No10/15 2 15
Pump D85-45×10 3 200
Scraper 2JP-7.5 4 8
Secondary Fan JK58-1 №4.0 6 6
Secondary Fan JK58—1No4.5 2 11
Pengjiagou Mine
Equipment Model Quantity  Power (kw)
Cage YJGG-1.8-1 2
Compressor EX-55A
10.2m3/min 6 55
Electric
Locomotives CTY2.5/6G 6 4
Hoist 2JK-2/20A 2 215
Jackleg YT-28 12
Jackleg YSP45 8
Loading Machine Z-17A 6 21
Main Fan FKZ-No11/30 2 30
– IIIA-242 –
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FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mining Assessment    Final
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#5 Mining Zone
Equipment Model Quantity  Power (kw)
Pump D25-50×8 6 75
Scraper 2JP-7.5 6 8
Secondary Fan JK58-1№4.0 6 6
Secondary Fan JK58—1No4.5 4 11
#1 Mining Zone
Equipment Model Quantity Power (kw)
Cage GLGA-1.8-1 1 -
Cage Double Deck 4 -
Compressor LG-10.5/8 6 55
Compressor BLT100A-10.5/1.0 2 75
Compressor 4L-20/8 1 130
Compressor 2V-7/7 1 39
Hoist 2JTP-1.6×0.9 2 40
Hoist 2JK-2/30A 1 155
Hoist 2JTP-1.6/20A 1 80
Hoist 2JTP-1.2×0.8 2 55
Hoist 2JK-2.0×1.25 1 155
Hoist JTP-1.2×1.0 1 55
Hoist 2JTP-1.6 1 80
Hoist JTK-1.0 2 22
Jackleg YT28 5 -
Main Fan K40-4-No9 1 11
Main Fan K40-4-11 1 30
Main Fan K40-4-10 2 15
Main Fan K40-4-9 1 11
Pump D46-50×8 3 90
Pump D25-50×7 6 55
Pump D46-50×7 9 95
Pump D25-30×3 3 15
Pump D25-50×9 3 75
Pump D25-30×4 3 19
Pump D46-50×3 6 37
Secondary Fan BT52-2 4 11
Secondary Fan JK58—NO4 4 6
Secondary Fan JK58-1No.4 8 6
Secondary Fan K40-4-8 8 6
Secondary Fan JK58-1NO4 4 6
Trolley Car 9 -
Source: Summarized from the studies
10.2.7 Production Schedule
The mine schedule was developed using Deswik software, based on productivity estimates for each
task. For instance, stope excavation requires several days for preparation. The assumptions for
mining sequence and dependencies are as follows:
 Mining and Processing Operation: Operations is estimated to start in 2026 with the ROM capacity
of 60ktpa.
 Vertical Overlap: Mining progresses downward, level by level, w ith typically 3-4 levels grouped
into one section for better operational flexibility.
 Horizontally Overlap: Mining advances from the hanging wall to the footwall.
 Priority: Based on the current development system and the anticipated yield of mined metals, as
well as considering the client's operational strategy, the initial mining operations will focus on #1
– IIIA-243 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mining Assessment    Final
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Zone and #3&#7 Vein. These will be followed by the extraction o f resources from #26 Vein, #5
Zone, and Pengjiagou.
 Life of Mine: 28 years.
The development schedule is not considered, as the mine has bee n previously operational and
further development is not seen as high-risk.
Figure 10-9 illustrates the production schedule, detailing both  the ROM production and the ROM
grade. Table 10-11 provides the details of mine production.
Figure 10-9: Production Schedule
Sources: SRK
Notes:
1 The line represents the average gold grade, corresponding to the right axis.
2 The column represents the ore amount, corresponding to the left axis.


 -
 2.00
 4.00
 6.00
 8.00
 10.00
 12.00
 -
 10
 20
 30
 40
 50
 60
 70
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
2051
2052
2053
Au Grade (g/t)
Ore (kt)
Mined_Tonnes Mined Au
– IIIA-244 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1070 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mining Assessment    Final
SRK CONSULTING CHINA LTD.  28 FEBRUARY 2025  YJ/YS 183
Table 10-11: Production Schedule

Sources: SRK


Total Unit LoM 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049 2050 2051 20 52 2053 2054 2055 2056
Total Tonnes Mined kt 1,693.20 - - 60.3 60.8 61 60.8 60.8 60.8 61 60.8 60.8 60.8 61 60.8 60.8 60.8 61 60.8 60.8 6 0.8 61 60.8 60.8 60.8 61 60.8 60.8 60.8 61 50 - - -
Au grade g/t 6.2 - - 5.6 5.2 4.6 5.3 5.6 5.5 4.9 5.3 5.1 5.5 5.4 5.1 5.9 6.9 6.3 6 7.4 5.9 8.7 10.1 9. 1 9.1 7.5 7.9 7.1 4.2 4.2 3.9 - - -
Contained Au koz 337.5 - - 10.9 10.2 9.1 10.3 10.9 10.7 9.6 10.3 9.9 10.8 10.6 10 11.5 13.4 12.4 11.8 14 .4 11.5 17.1 19.8 17.9 17.9 14.7 15.4 13.8 8.2 8.2 6.2 - - -
Zone 1
Total Tonnes Mined kt 789.2 - - - - - 33.9 60.8 60.8 61 60.8 60.8 60.8 61 60.8 60.8 60.8 61 60.6 22.7 2.2 - - - - - --------
Au grade g/t 5.7 ----- 6 . 1 5 . 6 5 . 5 4 . 9 5 . 3 5 . 1 5 . 5 5 . 4 5 . 1 5 . 9 6 . 9 6 . 3 6 8 . 4 5 . 4 -------------
Contained Au koz 145.1 - - - - - 6.7 10.9 10.7 9.6 10.3 9.9 10.8 10.6 10 11.5 13.4 12.4 11.7 6.1 0.4 - - - - - --------
Vein 26
Total Tonnes Mined kt 154.7 ------------------------ 4 4 . 2 6 0 . 8 4 9 . 7 ------
Au grade g/t 7.7 ------------------------ 7 . 5 7 . 9 7 . 7 ------
Contained Au koz 38.3 ------------------------ 1 0 . 7 1 5 . 4 1 2 . 3 ------
Vein 3&7
Total Tonnes Mined kt 357.3 ----------------- 0 . 2 3 8 . 1 5 8 . 6 6 1 6 0 . 8 6 0 . 8 6 0 . 8 1 6 . 8 --------
Au grade g/t 8.4 ----------------- 6 . 7 6 . 8 5 . 9 8 . 7 1 0 . 1 9 . 1 9 . 1 7 . 5 --------
Contained Au koz 96.2 ----------------- 0 . 1 8 . 3 1 1 . 1 1 7 . 1 1 9 . 8 1 7 . 9 1 7 . 9 4 . 1 --------
Area 5
Total Tonnes Mined kt 209 -- 6 0 . 3 6 0 . 8 6 1 2 6 . 9 ---------------------------
Au grade g/t 5 -- 5 . 6 5 . 2 4 . 6 4 . 1 ---------------------------
Contained Au koz 33.8 -- 1 0 . 9 1 0 . 2 9 . 1 3 . 6 ---------------------------
PJG
Total Tonnes Mined kt 183 -------------------------- 1 1 . 2 6 0 . 8 6 1 5 0 ---
Au grade g/t 4.1 -------------------------- 4 . 3 4 . 2 4 . 2 3 . 9 ---
C o n t a i n e d  A u k o z 2 4 . 1 -------------------------- 1 . 5 8 . 2 8 . 2 6 . 2 ---
– IIIA-245 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mining Assessment    Final
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10.3 Wulong Project
10.3.1 Introduction
The administrative division of the Wulong Gold Mine is governed by Zhen'an District of Dandong City,
which is located 15km to the northwest of Dandong City. The min e is located on mining lease
C2100002011084140116558. The mining level is from 100m asl to - 750m asl, with a total area of
6.2732 km2. The mine started small-scale mining in 1938, became a state-r un mine in 1948, and
changed from a state-run mine to a private mine in 2009, and th e mine has closed the abandoned
drift and backfilled the excavated voids with waste rock.
Wulong Gold Mine now has three stand-alone underground operating systems: Zone 2, Zone 3, and
Zone 4. Zone 4 is further separated into the main shaft zone an d the service shaft zone, which is
also known as Zone 5. Figure 10-10 shows the location of each zone.
Figure 10-10: Zone Layout

10.3.2 Geotechnical and Hy drogeological Conditions
Visually, the geotechnical and hydrogeological conditions at th e Wulong Project, as observed by
SRK during the site visit, range from fair to good. The undergr ound rock appears intact, with most
drifts being unsupported. However, localized support using wood or steel arches is necessary where
minor faults intersect the drifts. The tunnel backs and walls are dry, with minimal water on the floor,
which is collected in ditches and pumped to water tanks near th e adit exits. Based on the available
data and site observations, SRK considers the geotechnical and hydrogeological risks to be medium
to low.
– IIIA-246 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mining Assessment    Final
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10.3.3 Mining Method
For steep and thin orebody with solid surrounding wall rocks, resuing method is adopted to separate
the ore and surrounding rocks, with the ore being transported and extracted while the waste is kept
in the stope for backfilling.
For relatively thicker orebody, overhand cut and fill mining is  adopted (See Figure 10-11). Cut and
fill mining allows selective mining, separate recovery of high- grade portions, and stope retention of
low-grade rock. Excavated voids are backfilled with waste rock once the stope has been mined out.
This method provides a relatively inexpensive and convenient way to advance a working platform in
order to keep access to the ore for drilling, blasting, and mucking.
Figure 10-11: Overhand Cut and Fill

Source: Design from a PFS level of study (2020)
The stope is around 40 to 60 m wide, and it is not more than 40 m height. The section of the raise is
1.5m x 2.5m. There is a hopper set up every 15 m or so. Each st ope has one to two raises that are
connected to the upper middle level so that the waste rock can be used to backfill the stope. Once
the bottom drift has mined out, the void is backfilled with waste rock gen erated by development to
other level. The waste rock is stored underground in unused drifts.
Materials Movement and Handling
Electric locomotives are used for transportation to haul ore and waste rocks, and wooden sleeper
light rails are laid in the mine. The ore is lifted to the surf ace by shafts with double-deck cages,
unloaded to the stockpile and transported by trucks to the processing plant.
– IIIA-247 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mining Assessment    Final
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10.3.4 Production
History Production
The current stope operation has produced approximately 100 ktpa of ore with an average gold grade
of 6.86g/t over the past three years. Table 10-12 shows the historical stope production from 2021 to
the third quarter of 2024.
Table 10-12: Wulong Mine Yearly Stope Production from 2021 to 2 024 Q3
Item Unit 2021 2022 2023 2024Q1 – Q3
Ore Tonnes kt 104 104 106 78
Au Grade g/t 3.39 5.92 9.08 9.74
Au Metal kg 353 615 966 758
The Wulong Mine contains mineralized waste rock, development materials, residues in stopes, and
low-grade stockpiles both undergr ound and on the surface. Resid ues are the stopes that the prior
old mine regarded low-grade with no value. The stockpile is low -grade ores from the prior old mine
with an Au grade of less than 3g/t, which was heaped in the drift rather than being transferred to the
processing plant.
With the recent increase in gold prices, these materials have gained economic value and are now
considered as ROM material for comprehensive utilization in mining operations. The mine has begun
to haul the low-grade stope and transport the stockpile of previously low-grade ore to the processing
plant. Table 10-13 shows the historical produ ction for comprehensive utilization in the last three
years.
Table 10-13: Wulong Mine Yearly Production for comprehensive utilization from 2021 to 2024
Q3
Item Unit 2021 2022 2023 2024Q1 – Q3
Ore Tonnes kt 279 285 470 451
Au Grade g/t 1.86 2.62 1.86 1.60
Au Metal kg 519 746 876 721
Mine Design and Access
The section of the drift is about 2.4m x 2.5m. SRK notes that m ost of the drifts are solid enough to
not to be supported (Figure 10-12). A few of the drifts with weak surrounding rocks are supported
with wood or steel arcs.
Wulong Mine is accessed from shafts with double-deck cages in e ach zone. Each cage carries 9
people at one time. The current mine as-builts for each area are shown in Figure 10-13.
– IIIA-248 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mining Assessment    Final
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Figure 10-12: Level 7 in Zone 2 (-136m asl)

Source: Site visit on 23rd Dec 2022
Figure 10-13: Pan Views of Zone 2 (left), Zone 3 (centre) and Zones 4 and 5 (right) As-builts

Source: Management
SRK notes that the individual stopes are designed using 2D polygonal long sections once they reach
the level through development. Figure 10-14 shows the long section in Zone 4. This method is to
divide the orebody into different small blocks according to the  geological characteristics and
conditions of the deposit (such as ore grade, natural type, reserve category, technical conditions of
mining and hydrogeological conditions of the deposit, etc.) or exploration engineering, and for each
block, the reserves can be estimated by the arithmetic average method.
– IIIA-249 –
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FOR THE PRC MINES


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Mining Assessment    Final
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SRK notes that this is a medium-risk mine design method, althou gh it is frequently used in highly
variable vein systems in China.
Figure 10-14: Aver Example of 2D polygonal long sections in Zone 4

Source: Management
The development system is shafts and blind shafts. Shafts are b eing used for transporting ore and
waste and personnel. Development to access these stope blocks is designed years in advance. An
example of the development design is shown in Figure 10-15. The  schedule is based on designs,
crosscut assess, faces, raises, and ventilation.
Figure 10-15: Example of development design in Zone 4 and Zone 5

Source: Management
– IIIA-250 –
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FOR THE PRC MINES


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Mining Assessment    Final
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10.3.5 Underground Service
Ventilation
The air flows down the mine to the working places and levels fr om shafts and downcasts, and then
is discharged through upcasts. Figure 10-16 shows the internal design of ventilation. SRK notes that
there is no software simulate the rates of flow but only 2D design.
During the site visit, SRK observed that the ventilation was sa tisfactory and did not present any
potential hazards.
Figure 10-16: Ventilation system design in Zone 3

Source: Ventilation design from a PFS level of study (2020)
Dewatering
The current dewatering capacity for the mine is supported by a system of electric pumps set in
various levels and locations. Water from the drifts drains into a sump, and then water is pumped by
pumping stations to a surface pond.
SRK notes that the problem of water accumulation is not serious during site visit.
Air Compressor
According to a PFS-level research  study, the amount of air compressors was calculated by the air
consumption of jackleg. The analysis demonstrates that the compressed air delivery system satisfies
the majority of production requirements.
– IIIA-251 –
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FOR THE PRC MINES


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Mining Assessment    Final
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10.3.6 Mining Equipment
The quantity of major mining equipment used underground is summ arized in Table 10-14. The
amount and size of the equipment seem to be enough for the oper ation. SRK notes that only a few
equipment is in poor condition. It is less likely that there wo uld be a scarcity of equipment because
the mining equipment is less expensive and requires a smaller investment.
Table 10-14: Mining Equipment in Each Zone
Equipment Zone 2 Zone 3 Zone 4 Zone 5 Total
Trolley electric locomotives 46 25 47 16 134
Electric loader 17 15 20 14 66
Electric scraper 12 13 23 5 53
Mine cart 203 213 281 165 862
Source: Management
10.3.7 Production Schedule
The mine schedule was developed using Deswik software, based on productivity estimates for each
task. For instance, stope excavation requires several days for preparation. The assumptions for
mining sequence and dependencies are as follows:
 Mining and Processing Operation: Operations remain with the ROM capacity of 100ktpa.
 Vertical Overlap: Mining progresses downward, level by level, w ith typically 3-4 levels grouped
into one section for better operational flexibility.
 Horizontally Overlap: Mining advances from the hanging wall to the footwall.
 Priority: Stopes accessible via existing development will be mined first.
 Life of Mine: 12 years.
Due to the existing infrastructure, there is no ramp-up period.
Figure 10-17 illustrates the prod uction schedule, detailing bot h the ROM production and the ROM
grade. Table 10-15 provides the details of mine production.
– IIIA-252 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Mining Assessment    Final
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Figure 10-17: Production Schedule

Sources: SRK
Notes:
1 The line represents the average gold grade, corresponding to the right axis.
2 The column represents the ore amount, corresponding to the left axis.
Table 10-15: Production Schedule
Wulong Unit LoM 2024Q4 2025 2026 2027 2028 2029 2030
Total
Total Tonnes Mined kt 984 27 99 99 98 99 108 108
Au grade g/t 7.30 6.11 7.55 8.70 7.71 7.40 7.32 7.51
Contained Au koz 231 5 24 28 24 24 25 26
Zone 2
Total Tonnes Mined kt 160 9 30 30 29 30 17 14
Au grade g/t 7.22 7.43 5.96 6.94 8.17 6.28 7.84 8.00
Contained Au koz 37 2 6 7 8 6 4 4
Zone 3
Total Tonnes Mined kt 591 8 30 30 29 30 50 70
Au grade g/t 6.83 3.33 5.66 8.37 6.77 6.94 6.75 7.79
Contained Au koz 130 1 5 8 6 7 11 18
Zone 4
Total Tonnes Mined kt 132 3 14 20 21 27 26 21
Au grade g/t 7.96 8.14 10.16 9.10 6.18 9.34 7.63 6.47
Contained Au koz 34 1 5 6 4 8 6 4
Zone 5
Total Tonnes Mined kt 98 7 26 20 19 12 14
Au grade g/t 9.37 6.78 10.16 11.42 10.17 6.91 8.13
Contained Au koz 29 1 8 7 6 3 4
Sources: SRK
Wulong  LoM 2031 2032 2033 2034 2035
Total
Total Tonnes Mined kt 984 102 101 66 44 33
Au grade g/t 7.30 7.19 5.83 7.74 7.58 4.63
Contained Au koz 231 24 19 16 11 5
– IIIA-253 –
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Mining Assessment    Final
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Wulong  LoM 2031 2032 2033 2034 2035
Zone 2
Total Tonnes Mined kt 160 1
Au grade g/t 7.22 7.28
Contained Au koz 37 0
Zone 3
Total Tonnes Mined kt 591 100 101 66 44 33
Au grade g/t 6.83 7.18 5.83 7.74 7.58 4.63
Contained Au koz 130 23 19 16 11 5
Zone 4
Total Tonnes Mined kt 132 0
Au grade g/t 7.96 8.01
Contained Au koz 34 0
Zone 5
Total Tonnes Mined kt 98
Au grade g/t 9.37
Contained Au koz 29
Sources: SRK
10.4 Hanfeng Project
10.4.1 Introduction
Hanfeng Mining operate 2 established mines, the Lishan Mine and  the Dongfeng Mine. They are
both utilising conventional underground mining methodologies, a ccess via adit & shaft, shrinkage
stoping method, railway ore car transportation. There are 2 processing plants which located in Lishan
and Dongfeng respectively. Lishan plant is focused on zinc, lea d, and copper resources. Dongfeng
Plant processes molybdenum feeds. The infrastructure of both mines is established, and the risk of
shortage of power, water, fuel, and materials is low.
The two mines of Hanfeng Project operation and plan status are described as followings:
 Lishan Mine is divided into 2 parts in vertical.
– The upper part which is above -92m asl, is operated at a nominated capacity of 165ktpa ROM
contains zinc, lead, and copper elements, feeding the Lishan pl ant. The upper part is
currently in operation to mine the historically residual inventory. It has been confirmed with
the client that the upper part is not within the scope of the Ore Reserves estimation
– The lower part which is from -92m asl to -700m asl is planned to construct in 2 stages.
– Stage I is targeting the Mineral Resource from -92m asl down to  -373m asl. Stage I is
proposed at a capacity of 435ktpa, operating with upper part together to achieve 600ktpa
capacity. The construction of Stage I is on progress currently (as of September 2024).
Main shaft has been development but not equipped due to ventilation shaft and return air
drift is on developing.
– Stage II will focus on the Mineral Resource under -373m asl, downwards -700m asl. The
management of the Company aims achieving 600ktpa capacity of th is stage II relay the
Stage I and the upper part operation. However, the technical st udies and/or design on
this stage is not initiated yet.
– IIIA-254 –
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 Dongfeng Mine is also divided into 2 parts in vertical, and the intersection elevation is 250m asl.
– The upper part is on operating as South section and North section
– South section contains the Minera lisation veins of Zinc, Lead, and copper. This section
mined 36kt feed in 2022, and the management the Mineral Resource is nearly depleted.
However, they are hoping that the exploration during operation by along veins developing
would reveal more resource to maintain a mining plan of 60ktpa for next 3 years. The ore
of this section is trucked to Lishan plant for treatment.
– North section contains veins of Molybdenum element. This sectio n was on care and
maintenance before 2022. In 2022 this section was re-operated 6k ROM. Dongfeng Plant
was also re-operated to treat this 6k ROM and 9k ore from surface stockpile, which was
stored for nearly 10 years.
– The lower part is for North sect ion which is Moly resources. As  of 30 September 2024, the
lower part Mineral Resources were estimated, but the technical study is not initialled yet for
lower part as well as the mining license is not applied.
Only the Lower Part (Stage 1) of the Lishan Mine was considered  during the Ore Reserves
estimation, based on the status as of 30 September 2024.
10.4.2 Geotechnical & Hyd rogeological Conditions
Visually, the geotechnical & hydrogeological conditions of Dong feng mine, where SRK visited, are
fair to good. The rock underground appears competent, and the drifts are mostly unsupported. Local
support by wood or steel arcs is necessary where small faults are crossing the drift. The surrounding
rock of zinc veins are fair, but those around moly veins are we aker than zinc veins. The exposure
time is controlled by the operati on to mitigate the risk of han ging wall failure, as stated by the
management.
The tunnels back and walls are dry, and the water on floor is m inimum, collected at the ditch then
pumped in stages to water tanks close to the adit shaft exits.
The geotechnical & hydrogeological parameters for upper parts o f Lishan and Dongfeng mines are
unavailable to review. The lower part (Stage I) of Lishan Mine has studied and reported geotechnical
& hydrogeological conditions. The mechanical properties of rock  and ore are summarized in Table
10-16. Considering the size of openings, the preliminary design proposed unsupported tunnelling for
most drifts and stopes, wood or steel arc would be applied where weak zones occurred, or faults are
encountered.
Table 10-16: Summary of Rock Mech anical Properties of Lishan Lower Part (Stage I)
Property Unit Ore Surrounding
Testing Blocks QTY 11 37
Uniaxial Compressive
Strength
MPa 77.68-80.31 84.92-42.71
Extension Strength MP a 6.69-7.09 2.77-7.52
Cohesion MPa 8.82-9.02 4.92-9.76
Internal Friction Angle degree 50.96-51.07 42.16-53.71
Average RQD % 90.8 90.9
Class N/A Fair Fair
– IIIA-255 –
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Mining Assessment    Final
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Sources: Lishan LS1
The water inflow estimated for the Lishan Lower part, are 434m3 per day normally, and 3,430m3 per
day maximum. Considering the records of drainage at the range o f 200m3 to 500m 3 per day, the
hydrogeological condition is classified as simple.
SRK opines that both geotechnical and hydrogeological risks are medium to low based on the
available data and the site inspections.
10.4.3 Mining Method
Lishan Upper Part
Lishan Upper Part using shallow hole shrinkage stoping method f or all the stopes. When the
horizontal width of vein is wider than 2m, no sill pillar stope structure is applied. Otherwise, the stope
will leave a 5m high sill pillar for draw points. The crown pil lar of stope is 3-4m height. The stope
length is about 50m and the height is the same as level interva l. The rib pillar is 5-6m and the raise
for manway is located in the rib pillar. the draw points interval is about 6-7m middle to middle.
Lishan Lower Part Stage I
The preliminary design for Lishan lower Part proposed 4 stoping  methods that suit different vein
widths, which are as presented in Table 10-17.
Table 10-17: Summary of Stoping Methods for Lishan Lower Part ( Stage I)
Parameters Unit Shrinkage delay
fill
Slice &
fill Resuing sub-level open stope delay
fill
Vein horizontal
thickness m 0.8-5 0.8-5 <0.8 >5
Dipping degree  >50
Percentage % 35 15 10 40
Stope productivity tpd 150-200 60-80 20-30 200-250
Loss % 10 12 15 10
Dilution % 11 10 17 10
Sources: Lishan LS1
The backfill material is waste rock during drift developing.
Dongfeng Upper Part
Dongfeng Upper Part is using the same method as Lishan upper pa rt, which is shrinkage stoping
method for all the stopes.
10.4.4 Production
History Production
Table 8-18 shows the historical production record of Lishan Mine Upper Part and the Dongfeng Mine
Upper South, which primarily contains zinc and lead, and is processed at the Lishan Plant.
– IIIA-256 –
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Mining Assessment    Final
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Table 8-19 shows the historical p roduction record of Dongfeng M ine Upper North, which primarily
contains molybdenum and is processed at the Dongfeng Plant.
Table 10-18: Hanfeng Project (Lishan Mine Upper Part and the Do ngfeng Mine Upper South)
Yearly Ore Production from 2021 to 2024 Q3
Item Unit 2021 2022 2023 2024Q1 – Q3
Ore Tonnes kt 510 502 296 397
Comprehensive Grade % 2.94 2.80 2.58 2.16
Metal t 15,028 14,032 7,649 8,595
Sources: Client
Table 10-19: Hanfeng Project (Dongfeng Mine Upper North) Yearly Ore Production from 2021
to 2024 Q3
Item Unit 2021 2022 2023 2024Q1 – Q3
Ore Tonnes kt - - 73 120
Molybdenum Grade % - - 0.14 0.16
Molybdenum Metal t - - 102 186
Sources: Client
Underground Mine Design
Lishan Upper Part
The underground mine is accessed via a #2 cage shaft which is from the surface down to 42m asl,
the under levels are accessed via relay cage shaft. The run of mine is hoisted up to surface via the
#1 skip shaft. The projected view of the mine design is presented in Figure 10-18.
Figure 10-18: Longitudinal Projected View of Lishan Upper Part

– IIIA-257 –
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Mining Assessment    Final
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Sources: Client
The broken ore from the stopes is loaded into ore cars by the r ailway ore loader.  The ore cars are
hauled by locomotive via the level drift to shaft station at the level access. The ore is then hoisted to
surface by the hoisting system in the skip shaft. All personnel and materials as well as the waste rock
are transported in and out of the mine via the #2 cage shaft and level drifts. The level interval is about
30m height, totally 20 levels have been established.
Lishan Lower Part Stage I
Lishan lower part Stage I designed as adit & blind shaft develo pment. The adit is at 554m asl and
the shaft from this adit down to -373m asl with a diameter of 5 m, equipping cage. All materials,
personal and run of mine are transported via this main shaft. t he waste rock will be backfilled into
mined voids as planned. When waste rock could not be balanced to fill, the rest waste will be hoisted
via the main shaft out.
The level transported as similar as the upper part using ore car hoisted by locomotive from stope to
shaft station on each level access.
Dongfeng Upper Part
Dongfeng Mine upper part is accessed via a main cage shaft which is from the surface down to 288m
RL. The run of mine from both North and South Sections are hoisted up to surface via the main shaft.
The projected view of the mine design is presented in Figure 10-19.
Figure 10-19: Longitudinal Projected View of Dongfeng Upper Part
Sources: Client
All materials, personal and run of mine are transported via thi s main shaft. the distance from North
Section to main shaft is somehow long which is around 800 to 1000m. the main adit and drift of level
3 are shown in Figure 10-20.
– IIIA-258 –
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Mining Assessment    Final
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Figure 10-20: Photos of Access of Adit and Drift on Level 3 at Dongfeng Mine

Sources: shot during site visit on 9th Jan 2023
Note: Access of Adit (left) and Drift (right) on Level 3 of Dongfeng Mine
10.4.5 Underground Service
Lishan Upper Part
Ventilation system for upper part is established. The water supply, compressed air supply, drainage
system as well as power supply system have been established already.
Lishan Lower Part Stage I
Lishan lower part has designed underground service system, the ventilation shaft is sinking when
the site visit, and the main shaft is sunk but not equipped.
Dongfeng Upper Part
Dongfeng upper part is the same situation as Lishan upper part.  The main sump and power
substation underground of Dongfeng upper part is shown in Figure 10-21.
– IIIA-259 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
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Mining Assessment    Final
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Figure 10-21: Photos of Main Sump and Power Substation on Adit Level of Dongfeng Mine

Sources: shot during site visit on 9th Jan 2023
Note: Main Sump on Adit level (left) and Main Power Substation underground (right) at Dongfeng Mine
10.4.6 Mining Equipment
There is no heavy mobile equipment on site. The mine machinery is mostly shaft hoisting equipment
and trailway locomotive and ore cars, as well as fans for ventilation.
The machinery of hoisting system is maintenance well during site visit, as shown in Figure 10-22.
Figure 10-22: Shaft Access on Adit Level of Dongfeng Upper Part

Sources: shot during site visit on 9th Jan 2023
– IIIA-260 –
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Mining Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 199
The mining equipment in each zone is shown in Table 10-20.
Table 10-20 Mine Equipment Requi rements for Hanfeng Project
Equipment Model Quantity  Power (kw)
Secondary Fan JK58—1NO.4 24 5.5
Secondary Fan JK58—1NO.4.5 20 11
Jack Leg YT-28 20
Jack Leg YSP45 8
Jack Leg YGZ90 2
Loading Machine Z-17AW 14 21
Scraper 2DPJ—30 8 30
Scraper ZWY-60/18.5T 12 18.5
Charger BQF-100 2
Source: Summarized from the preliminary design
10.4.7 Production Schedule
The mine schedule was developed using Deswik software, based on productivity estimates for each
task. For instance, stope excavation requires several days for preparation. The assumptions for
mining sequence and dependencies are as follows:
 Mining and Processing Operation:  Operation is estimated to be s tarted in 2025 with the ROM
capacity of 430ktpa.
 Vertical Overlap: Mining progresses downward, level by level, w ith typically 3-4 levels grouped
into one section for better operational flexibility.
 Horizontally Overlap: Mining advances from the hanging wall to the footwall.
 Priority: Stopes accessible via existing development will be mined first.
 Life of Mine: 8 years.
Figure 10-23 illustrates the prod uction schedule, detailing bot h the ROM production and the ROM
grade. Table 10-21 provides the details of mine production.
Table 10-21: Production Schedule
Hanfeng  LoM 2024E 2025E 2026E 2027E 2028E 2029E 2030E 2031E 2032E
Total Tonnes Mined Mt  3.31  0.43  0.44  0.43  0.36  0.45  0.43  0.40  0.37
Zn grade % 2.45  2.32  2.25  2.32  2.13  2.80  3.03  2.40  2.23
Contained Zn kt  81  10  10  10  8  13  13  10  8
Sources: SRK

– IIIA-261 –
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Mining Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 200
Figure 10-23: Production Schedule

Sources: SRK
Notes:
1 The line represents the average gold grade, corresponding to the right axis.
2 The column represents the ore amount, corresponding to the left axis.
10.5 Jintai Project
10.5.1 Introduction
Jintai Project obtains one mining license and one exploration license for Xidengping Mine. Based on
the geological definition, there are several mineralization zones named V1, V2 (V2_1, V2_2), V4, V5,
V6, V7, V8, V9, and V10. It should be noted that only V1, V2, V 4, and V10 have measured and
indicated resources.
Several technical studies on the mineralized bodies V1 and V2 w ithin the mining license were
conducted since they obtained the mining license in 2012. Only V1 and V2 are included in the Ore
Reserves, as there are no sufficient technical studies for the remaining mining zones.
They initialled mine construction for V1 and V2 at the beginnin g 2023 for both mine and plant. The
designed capacity for V1 and V2 is 140 ktpa.
Currently, Jintai Mining is in the process of applying for another mining license for the exploitation of
V4 and V10, with a capacity of 650 ktpa based on FS 2024.
10.5.2 Geotechnical & Hydrogeological Conditions
GOCOM admitted that due to the la ck of geotechnical parameters,  the surrounding rock
characteristics in the open pit mine were analysed using empiri cal and analogous data. Without
detailed geological cross-sections and zoning data, the verification cross-sections were based on a
generalized model of the designed open-pit boundary.
Slope stability was analysed using the Janbu, Bishop, Morgenste rn-Price, and Spencer methods.
The results show that the slope is stable when the final angle is less than 40°. Figure 10-25 shows
– IIIA-262 –
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Mining Assessment    Final
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the location of the slope stabilit y verification cross-sections , and Table 10-22 shows the stability
results under different conditions.
Figure 10-24: Production Pit in V1 Pit Area

Sources: Jintai FS 2022
Table 10-22: Jintai Project Slope Stability Analysis Results
Scenario
Janbu Bishop  Morgenstern-
Price Spencer
I-I II-II I-I II-II I-I II-II I-I II-II
Dead Weight 1.584 1.610 1.569 1.603 1 .581 1.606 1.581 1.611
Dead Weight + Earthquake 1.398 1.411 1.367 1.396 1 .396 1.412 1.396 1.412
Dead Weight + Precipitation 1.362 1.361 1.348 1.355 1. 358 1.357 1.358 1.357
Sources: Jintai FS 2022
The overall slope angles in the design are 10° to 32° for the V 1 and 11° to 22° for the V2. In some
areas, the angles are controlled within 40°, and GOCOM consider ed the slope stability to be safe.
Additionally, slope stability monitoring and precaution measures should be considered during actual
operations.
This area is characterized by a high plateau with low to medium  mountain terrain. The currently
controlled orebodies are distributed above the erosion base lev el. Observations indicate that the
terrain is conducive to the natural discharge of groundwater, w ith atmospheric precipitation quickly
draining from the surface and dissolution fractures. Additional ly, the rivers within the area have no
impact on the water inflow into the ore deposits. Only a few sections of the pit experience minor water
infiltration. The hydrogeological conditions at the locations of the orebodies are classified as simple.
– IIIA-263 –
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Mining Assessment    Final
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The orebodies are located on small ridges or gentle slopes, wit h natural slope angles ranging from
0° to 15°, indicating relatively good stability. During the rainy season, heavy rainfall may cause minor
collapses of sandy and muddy materials on the surface. The main  orebodies are either directly
exposed at the surface or covered by a thin overburden, resulting in minimal stripping material. The
orebodies consist of massive hard rock, with a soft rock layer as the footwall. The primary gold
orebodies are hosted within fracture zones or fissures, and the  orebodies themselves exhibit good
stability. The engineering geological exploration type of the m ining area is classified as medium,
predominantly consisting of weak to semi-hard clastic rocks.
10.5.3 Mine Method
Considering the mineralisation occurrence and mining license pe rmits, a capacity of 140ktpa feed
ore is designed.
The conventional mining sequence proceeds downwards, and two benches work simultaneously in
each section.
A conventional open pit mining methodology is used, comprising free dig & loading, and haulage by
truck. The mine is run as contractor operation, and the owner r esponse for technical service and
management. No magazine is proposed due to no blasting works needed.
Mining
The main mining equipment is excavator. 2 sets of 1m 3 bucket excavators are proposed for about
490ktpa total material movement, which consist of 140ktpa ore and 350ktpa waste in average. 1 set
of the same excavator is proposed stand-by for miscellaneous wo rk. Excavator capacity estimates
is presented in Table 10-23.
Table 10-23: Excavator (1m3 bucket) Capacity Estimates
Item Unit Parameter for Ore Parameter for Waste
Days per annual day 300.0 300.0
Shift per day shift 2.0 2.0
Hours per shift hr 8.0 8.0
Bucket Capacity m3 1.0 1.0
Circle time per load round second 45.0 45.0
Bucket fill factor % 90.0 90.0
Rock swell factor % 150.0 150.0
Availability % 80.0 80.0
Utilization % 80.0 80.0
Bulk density (ore) t/m3 2.1 1.9
Annual capacity per excavator ktpa 317.0 280.0
Capacity per shift m3/shift 245.8 245.8
Source: FS 2022
As the estimates result above, 2 set of excavators are suitable for the nominated mine capacity. As
the bulk density of waste (~1.9t/m3) is lower than that of ore (2.1t/m3), it is resulting an annual capacity
per an excavator is 280ktpa, A set of excavators stand-by is reasonable, when considering the work
unbalance for waste and ore.
– IIIA-264 –
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Mining Assessment    Final
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Transport
The transport of material, which are ore and waste, by trucks via in-pit and out-pit roads. The roads
are designed based on truck size requirement.
The existing road connected the trail production pit (V1 pit) portal at 1,943m asl and crusher station
at 1968mRL is single lane as about 3m wide, the average gradient is 5.9%.
The designed main road is dual lane with 8m total wide, consist  of 6m net road surface, 2m berm
(1.5m) and ditch (0.5m). The road surface is clay bound macadam  pavement. The branch road is
4.5m wide as the same pavement as main road. The segment of road system is as followings:
 V1 pit road above 1,939m asl: out-pit dual lane, the radius of turning is 15m; average gradient
is 5% and the total length is about 1,076m;
 V1 pit road below 1,939m asl: in-pit dual lane with the same configuration as out-pit road, and
the total length is about 400m
 V2 pit road above 1,980m asl: out-pit dual lane connects to V1 pit 1,988m asl bench at 2,006m
asl of V2 pit. The lower part from 2,006m asl down to 1,980m asl is inclined ramp in pit. The
total length is 1064m.
 V2 pit road below 1,980m asl: out-pit dual lane from V1 1,950m asl bench to V2 pit 1,980m asl.
The total length is 1,025m. The material below 1,980m asl is transported via in-pit ramp as the
total length is about 343m.
 Waste routes: the waste stripped from V1 pit is dumped in the temporary stockpile for land
reclamation, which is about 50m away from pit edge. This branch road is designed as single
lane with a width of 4.5m. The waste form V2 pit will be dumped into V1 mine-out voids via the
roads described above.
Considering the total material movement annually, the truck requirement is estimated by FS2022 as
shown in Table 10-24. Totally 6 set of 7.8t payload trucks are proposed when considering 70%
availability.
Table 10-24: Truck Capacity Estimates
Item Unit Feed Waste
Hours per shift hr 8.0 8.0
Time utilization % 85.0 85.0
Loading buckets per truck bucket 6.0 6.0
Average haulage distance km 0.9 1.2
Average speed km/h 20.0 20.0
Travel time per round min 5.4 7.2
Loading time min 4.0 4.0
Dumping time min 1.0 1.0
Waiting time min 2.0 2.0
Circle time per truck round min 12.4 14.2
Payload utilization % 93.0 96.0
Truck payload t 7.8 7.8
Capacity per shift t per shift 238.7 214.2
Mining Target ktpa 140.0 350.0
– IIIA-265 –
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Mining Assessment    Final
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Item Unit Feed Waste
Days per annual day 300.0 300.0
Shift per day shift 2.0 2.0
Workload per shift t/shift 233.3 583.3
Unbalance factor N/A 1.2 1.2
Trucks per shift QTY 1.1 3.1
Availability % 70.0 70.0
Total trucks QTY 6.0
10.5.4 Mine Design
Mine design scope is the 100m South away from country road (X08 4 road) and the boundary of V1
& V2 veins. The mine design follows typical open pit design procedure, which is from pit optimization,
detailed design and modification.
Pit Optimization
To develop an optimal open pit design for the Mine, an optimised open pit shell was prepared using
the Lerchs-Grossman 3D algorithm i n GEMCOM software (LG 3D). Th e LG 3D open pit optimiser
determines a set of resource blocks with the maximum value per tonne, creating an optimised open
pit shell from a resource block model. The inputs of pit optimi zation as proposed in FS 2022 are
presented in Table 10-25.
Table 10-25: Input Parameter for Pit Optimization in FS 2022
Item Unit Parameter
Mining cost RMB/t total material moved 8
Post-mining cost RMB/t feed ore 98
Mining dilution % 5
Mining loss % 5
Processing recovery rate % 85.5
Gold price RMB/gram 313
Payable of gold product % 97
OSA degree 40
Source: FS 2022
Note:
1 Post-mining cost includes processing, G&A, and other Miscellaneous
2 OSA is standing for overall slope angles.
Pit Design
The pit design was under the guide of optimization and the desi gn inputs, then manual modified by
engineer. The design inputs are presented in Table 10-26.
– IIIA-266 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mining Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 205
Table 10-26: Summary of Design Inputs
Item Unit Parameter
Bench height m 10
Sub-bench height m 5
BFA degree 40
Catch berm  m 4
Safety berm m 7
Road berm m 8
Ramp width m 8
Road gradient % 5
OSA degree 40
Note: BFA is standing for bench face angles.
The designs are presented in Figure 10-25 and the results are shown in Table 10-27.
Figure 10-25: Pit Design for V1 and V2 by GOCOM

Source: FS 2022
Table 10-27: Pit Design Result in FS 2022
Item Unit V1 Pit V2 Pit
Pit size m x m 472 x 336 409 x 138
Crest elevation mRL 2,007.0  2,011.0
Bottom elevation mRL 1,972.0  1,946.0
Pit dept m 80.0  65.0
Closed circle elevation mRL 1,939.0  1,954.0
resource in pit kt 1,409.9  212.4
incl. Measured (CN Standard) kt    -       -
incl. Indicated (CN Standard) kt 1,253.1  75.4
incl. Inferred (CN Standard, 70%) kt 156.8  137.0
Waste (Including 30% Inferred) kt 699.1  1,096.9
Mineable resource kt 1,362.9  171.3
Stripping ratio t/t 0.5  6.4
Average grade g/t 0.81  0.90
– IIIA-267 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mining Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 206
Source: FS 2022
The table above shows V2 pit contains more Inferred Resource (79%) than that in V1 pit (11.5%).
10.5.5 Production
The Project has started operation since 2023 (See Table 10-28 with average grade of 0.69g/t.)
The mining operation employs free digging methods due to the relatively shallow nature of the deposit,
eliminating the need for drilling and blasting. The mining and hauling are conducted by contractors.
Table 10-28: Jintai Mine Yearly Ore Production from 2023 to 2024Q3
Item Unit 2023 2024 Q1-Q3 Total
Ore Mined t 200,358 360,295 560,653
Ore Milled t 122,924 404,103 527,027
Au grade g/t 0.83 0.65 0.69
Source: Jintai Mining
10.5.6 Mine Service
The mine site area is covered by lush vegetation and the weathe r is classed as hot climate, which
belongs to the plateau mountain area. November to May of the ne xt year is the dry season. The
rainfall is concentrated from June to October, with the annual average rainfall of 1,000~1,400mm.
the average temperature is 12~14 ℃ annually, with the highest temperature could reach around 35
℃ from May to August.
A flood prevention channel is to be constructed around 2 pits o f the project preventing outsource
water flowing into pits. As well as the closed circle of each p it, connected channel to outer channel
are also designed on 1,947m asl of V1 pit and 1,956m asl of V2 pit, respectively. The channel is
designed as 0.8m × 0.8m rectangle, with cemented masonry wall at 0.3m thickness.
The dewater facilities in pit are also designed considering the inflow volume as Table 10-29.
Table 10-29: Water Inflow Estimates and Dewatering
Item Unit V1 Pit V2 Pit
Normal Water Inflow Volume m3/d 598 144
Maximum Inflow (once in 20 years) m3/d 5978 1439
Maximum days of flooding day 7 7
Capacity of dewatering m3/d 854 206
Dewatering height m 15 10
Pump model SQ35-22 SQ35-22
Head of pump m 22 22
Rate of pump flow m3/h 35 35
Power kW 5.5 5.5
Set QTY 2 2
Source: FS 2022
– IIIA-268 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1094 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mining Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 207
The pumps are planned transfer to V2 pit as soon as V1 is finished mining. The pipeline is designed
using DN100 seamless steel tube along benches.
Water consumption is mainly attributable to dust suppression pu rposes, sourced from plant head
tank.
The electric power requirement of the mine site is minimal, and  its main uses are the dewatering
pump, and lighting. A 10kV/0.4kV substation is located on the m ine site and is connected to the
national electricity grid.
Maintenance of mobile mining equipment is proposed to be outsourced from downtown.
The diesel supply is planned outsourced from downtown supplier via tank truck to refill the mobile
equipment. There are no planned fuel storage facilities on site.
10.5.7 Mining Equipment
Apart from the main mining equipment fleet of excavator and tru ck, there are several types of
equipment suitable for relevant activities. There are water tru cks for dedusting, rock breaker, front-
end loader (FEL) and so on. The mine fleet as proposed by FS2022 is presented in Table 10-30.
Table 10-30: Main Mining Equipment Fleet as Proposed
Fleet QTY Specification
Excavator 3 1m3 bucket
Truck 6 7.8t payload
FEL 1 1m3 bucket
Water truck 1 5t tank
Rock breaker 1
Sources: Jintai FS 2022
10.5.8 Production Schedule
The strategic scheduling is based on the Whittle shell (RF=1) a nd serves as a guide for the high-
level scheduling of the final design. The processing capacity is designed and constructed to handle
140ktpa. There is no cut-back for V1 and V2; both pits will be operated as a single operation.
The mining sequence and/or dependency is simplified as follows:
• Mining and Processing Operation: Operation remains with the RO M capacity of 140ktpa.
• Operational Design: Based on the Feasibility Study (FS) 2022, the mine is designed to
operate 300 days per year, with two shifts per day, each lastin g 8 hours. The proposed
mining capacity is 140ktpa of feed ore, and the total material mining capacity is
approximately 490ktpa.
• Mine Plan Strategy: The strategy involves mining the V1 pit fi rst, with the mined-out pit of V1
serving as the dumping area for waste rock from the V2 pit.
• Vertical Overlap: The mining sequence progresses downwards, be nch by bench.
• Horizontal Sequence: The material on each bench is divided int o blocks with a maximum
area of 2,500 m².
– IIIA-269 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1095 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mining Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 208
• Stripping Line: The proposed stripping line is 200 m for the V 1 pit and 120 m for the V2 pit,
with a minimum width of 20 m.
Based on the strategy and assumptions above, the LoM is schedul ed using Deswik software. The
mining plan, ROM and ROM feed are presented in Figure 10-26 and  Figure 10-27 at an annually
basis.
The mining schedule by SRK is shown in Table 10-31 below.
Table 10-31 Mining Schedule of SRK
Item LOM 2024E 2025E 2026E 2027E 2028E 2029E 2030E
Feed Ore (kt)  1,370   33   140   140   140   140   137   137
Grade (g/t)  0.75   0.66   0.57   0.62   1.01   0.60   0.58   0.77
Waste (kt)  2,568   114   133   110   69   161   105   146
S/R (t/t)  1.87   3.42   0.95   0.79   0.49   1.15   0.77   1.06
TMM (kt)  3,938   148   273   250   209   301   242   283
V1 Pit
Feed Ore (kt)  1,224   33   140   140   140   140   137   137
Grade (g/t)  0.75   0.66   0.57   0.62   1.01   0.60   0.58   0.77
Waste (kt)  1,261   114   133   110   69   161   105   146
S/R (t/t)  1.03   3.42   0.95   0.79   0.49   1.15   0.77   1.06
TMM (kt)  2,485   148   273   250   209   301   242   283
V2 Pit
Feed Ore (kt)  130   -     -     -     -     -     -     -
Grade (g/t)  0.75   -     -     -     -     -     -     -
Waste (kt)  1,307   -     -     -     -     -     -     -
S/R (t/t)  10.07   -     -     -     -     -     -     -
TMM (kt)  1,437   -     -     -     -     -     -     -

Item LOM 2031E 2032E 2033E 2034E
Feed Ore (kt)  1,370   132   135   140   94
Grade (g/t)  0.75   0.53   0.63   1.29   0.95
Waste (kt)  2,568   212   175   891   453
S/R (t/t)  1.87   1.60   1.29   6.37   4.81
TMM (kt)  3,938   344   310   1,031   548
V1 Pit
Feed Ore (kt)  1,224   132   135   89   -
Grade (g/t)  0.75   0.53   0.63   1.58
Waste (kt)  1,261   212   175   37
S/R (t/t)  1.03   1.60   1.29   0.42
TMM (kt)  2,485   344   310   126
V2 Pit
– IIIA-270 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1096 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mining Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 209
Item LOM 2031E 2032E 2033E 2034E
Feed Ore (kt)  130   -     -     40   89
Grade (g/t)  0.75   -     -     0.79   0.95
Waste (kt)  1,307   -     -     853   453
S/R (t/t)  10.07   -     -     21.13   5.07
TMM (kt)  1,437   -     -     894   543

Figure 10-26: TMM Schedule over LoM

Sources: SRK
Notes:
1 The line represents the average gold grade, corresponding to the right axis.
2 The column represents the ore and waste amount, corresponding to the left axis.
– IIIA-271 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1097 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mining Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 210
Figure 10-27: Plant Feed Schedule over LoM

Sources: SRK
Notes:
1 The line represents the average gold grade, corresponding to the right axis.
2 The column represents the ore amount, corresponding to the left axis.
The proposed plan aligns with the client's strategy to sustain plant feed as previously outlined,
resulting in a 11-year mine life, a total of 1,370 kt of feed will be processed. The final year of the LoM
will involve a ramp-down phase.
The peak mining amount is projected in 2033, with a capacity of  1,031ktpa, which exceeds the
designed mining capacity. To accommodate this peak, additional equipment mobilization should be
planned well in advance, even considering the decade-long lead time. The summary of LoM is in
Table 10-32.
Table 10-32 The Summary of LoM
Period TMM (kt) ROM (kt) ROM GRADE
(g/t) WASTE (kt) SR (t/t)
2024  148   33   0.66   114   3.42
2025  273  140 0.57  133  0.95
2026  250   140   0.62   110   0.79
2027  209  140 1.01  69  0.49
2028  301   140   0.60   161   1.15
2029  242  137 0.58  105  0.77
2030  283   137   0.77   146   1.06
2031  344  132 0.53  212  1.60
2032  310   135   0.63   175   1.29
– IIIA-272 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Mining Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 211
Period TMM (kt) ROM (kt) ROM GRADE
(g/t) WASTE (kt) SR (t/t)
2033  1,031  140 1.29  891  6.37
2034  548   94   0.95   453   4.81
Sources: SRK
– IIIA-273 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Processing and Metallurgical Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 212
11 Processing and Metallurgical Assessment
11.1 Jilong Project
11.1.1 Processing and Metallurgical Testwork
The components of the gold-bearing ore at the Zhuanshanzi Mine are relatively simple. The ore
minerals are native gold, native silver, electrum, pyrite, sphalerite, galena, chalcopyrite and a small
amount of chalcocite, and argentite. The gangue minerals are mainly quartz, followed by feldspar,
calcite, sericite, and chlorite. The main mineral available for recovery in the ore is gold.
In 2018, Jilong Mining commissioned Jilin Institute of Geologic al Sciences to conduct a laboratory
flotation process test on ore of the Zhuanshanzi Mine.
The gold grade of the composite sample was 10.20g/t, and the si lver grade was 45.32g/t. After
grinding to -0.074 mm accounting for 70% (P 70=74μm), the sample was subjected to one roughing,
two cleanings and two scavengings to obtain gold concentrate with a gold grade of 147.78g/t and a
gold recovery of 95.05%, and a silver grade of 554.34g/t and a silver recovery of 80.25%, the test
results are shown in Table 11-1. The test shows that the flotat ion process can be used to obtain
desirable indexes for the ore of Zhuanshanzi mine. Nevertheless, Jilong Metallurgical Plant has not
adopted the flotation method but whole ore cyanidation, as the whole ore cyanidation can produce
gold bullion on site.
Table 11-1: Test Results of Ore Sample from Jilong Mine
Product Yield (%)
Grade (g/t) Recovery (%)
Au Ag Au Ag
Concentrate 6.56 147.78 554.34 95.05 80.25
Tailings 93.44 0.54 9.58 4.95 19.75
ROM 100.00 10.20 45. 32 100.00 100.00
Source: Laboratory Process Test Study Report on Rock Gold Ore P rocessing of Zhuanshanzi Mine, Aohan Banner, Inner
Mongolia Autonomous Region, February 2018.
11.1.2 Production Status of Processing Plant
The original production capacity of #1 Jilong Plant is 400tpd (120,000 tpa). In May 2022, a new
600tpd processing plant (i.e., #2 Jilong Plant) began to be con structed, and was put into operation
in June 2024.  The new plant has already reached its designed capacity, thus two plants can achieve
a total production capacity of 1,000tpd (300,000 tpa).  The two  plants adopt the same process of
whole ore cyanidation, with the final product being gold ingot. The gold recovery rates reaches over
96% for the #1 Jilong Plant, and varies from 92.11% to 97.24% for the #2 Jilong Plant.
Production Flowsheet
The two processing plants adopt a mature process flowsheet of w hole ore cyanidation - counter-
current decantation washing (“CCD”) - zinc dust precipitation ( Merrill-Crowe pro cess) - tailings
decyanation and dry stockpiling, which is shown in Figure 11-1.
– IIIA-274 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1100 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Processing and Metallurgical Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 213
Figure 11-1: Production Flowsheet of Jilong Processing Plant

The specific production flowsheet is described as follows:
Crushing and Grinding
The crushing operation adopts a two-stage closed-circuit proces s. The ROM feed size is less than
200mm and the final crushed product size is less than 16mm, after which it is sent to the fine ore bin
for grinding.
The grinding operation adopts a one-stage closed-circuit grinding and classification process, with
final grinding fineness of -74 μm accounting for more than 70% (P70=74μm). At the same time,
sodium cyanide and lime are added to the grinding system for gold leaching in advance.
Cyanide Leaching - Zinc Dust Precipitation (Merrill-Crowe Process)
 Pre-leach Thickening and Cyanide Leaching
The overflow from the classifier firstly enters the thickener for thickening, and the thickened underflow
slurry is leached in a train of agitation tanks by adding sodium cyanide and filled with oxygen for 35
hours. The overflow from the thickener is used as the pregnant solution and flows into the pregnant
solution tank to enter the zinc dust precipitation circuit (Merrill-Crowe process).
 CCD and Merrill-Crowe Process
– IIIA-275 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1101 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Processing and Metallurgical Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 214
The cyanide leached slurry enters a triple-deck thickener and a  single thickener for counter current
decantation (“CCD”). The final overflow is returned to the grinding system as feed water before and
after the ball mill. The final underflow is pumped to tailings detoxing operation.
After being purified by the filter cloth of the purification ta nk, the pregnant solution is vacuum self-
primed to the deoxygenation tower for deoxygenation, after which zinc powder is added for zinc dust
precipitation, and then fed into a frame filter press by pump. The filtrate enters the lean solution tank
as washing water, and the filter cake (gold mud) is blown dry b y high pressure air and sent to the
smelting room to obtain the final product "gold ingot".
Tailings Decyanation and Stockpiling
The washed pulp (cyanide residue) from CCD operation is transpo rted to the tailings detoxing
workshop, where the tailings is press filtered and the cake is simultaneously backwashed with clean
water and backblown with high pressure air, while decyanidation  reagents are added to break the
cyanide in the tailings to reduce the cyanide content of the ta ilings. The water content of the filter
cake is around 15% and the filtrate is returned to the cyanidation workshop for reuse, while the filter
cake is transported by loader and dump truck to the TSF.
Mineral Processing Facilities and Main Equipment
The processing plant facilities mainly include crushing and scr eening workshop, grinding, leaching,
substitution, CCD workshop and tailings press filter workshop, and has a complete laboratory assay,
TSF, water and electricity supp ly facilities. The main processi ng equipment includes crushing and
screening machines, grinding and classifying machines, thickene rs, purification and deoxygenation
equipment, filters, etc., which are listed in Table 11-2.
SRK conducted a site visit to the key workshops and production equipment of the processing plant.
SRK noted that the equipment of 400tpd processing plant was in good condition and although there
were some minor flaws in the equipment configuration, which did  not affect production. The new
600tpd plant has installed more advanced equipment, which is a modern plant integrating production,
intelligence, sightseeing and green. The site photos of the original plant and the new plant are shown
in Figure 11-2 and Figure 11-3, respectively.
Table 11-2: Main Equipment of Jilong Processing Plants
No. Equipment Specification Power (kw) QTY.
#1 Jilong Plant
1 Jaw crusher PEX250*750 30 1
2 Chute feeder JZQ350 7.5 2
3 Double deck vibrating screen 2ZD1530 7.5 1
4 Cone crusher GP100 90 1
5 Pendulum feeder 400*400 1.5 4
6 Ball mill 2100*4500 245 1
7 Classifier FC-20 15 1
8 Ball mill 1500*3000 80 1
9 Classifier FLG-120 5.5 1
10 Triple-blade Roots blower DQSR-150 30 2
– IIIA-276 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1102 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Processing and Metallurgical Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 215
11 Zinc powder feeder 170-266 0.75 4
12 Leaching agitation tank 4500x4500 7.5 14
13 Triple-deck thickener 12000*9325 5.5 2
14 Plate and frame filter press BAY30/630U 2.2 6
15 Pre-leach thickener NZX-24 7.5 1
16 Washing thickener NZX-24 7.5 1
17 Tailings filter press HAZF400/1600UK 18.5 4
18 Purification filter 2100×2100 5
19 Deoxygenation tower φ1500×3600 4
20 Zinc powder subst itution equipment 4
#2 Jilong Plant
1 Jaw crusher C80 75 1
2 Cone crusher HP200 189.6 1
3 Double deck vibrating screen 2YA2148 30 1
4 Ball mill MQY2700×5400 630 1
5 Cyclone feed pump Q=200m³/h，H=40m 90 2
6 Hydrocyclone Ø350-4 1 set
7 Pre-leach thickener Ø24 19.4 1
8 Leaching agitation tank Ø6500×7000 30 8
9 Screw blower Q=45.7m³/min 90 2
10 Washing thickener Ø24 19.4 4
11 Deoxygenation tower  Ø1500×3600 4
12 Substitution Plate and frame filter press BAY60/1000-UK 6
13 Screw air compressor Q=10m³/min 55 1
14 Zinc powder subst itution equipment 4
15 Tailings filter press HAZFQ800-2000-UK   6

– IIIA-277 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1103 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Processing and Metallurgical Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 216
Figure 11-2: Site Photos of #1 Jilong Plant

 Source: SRK site visit
– IIIA-278 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Processing and Metallurgical Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 217
Figure 11-3: Site Photos of #2 Jilong Plant

Source: SRK site visit
Historical Production Index
SRK has analysed and summarised the historical production indexes of # 1 and #2 Jilong Plant from
2021 to September 2024 through the site visit and collected pro duction statements and other
information, and the results are shown in Table 11-3. Additiona lly, the #2 Jilong plant has been put
into operation since May 2024.
According to the data in the below table, SRK noted that actual annual ROM throughput has reached
the designed capacity, and the gold recovery rate reaches over 96%.
Table 11-3: Historical Production Index of Jilong Plant
Item Unit 2021 2022 2023 2024 Q1-Q3 1
ROM throughput kt 143.7 152.7 152.6 168.0
Feed grade g/t 7.51 5.52 9.33 4.88
Gold recovery % 97.08 96.17 97.66 96.52
Gold ingot output 2 kg 1,048 811 1,390 795
Notes:
1 The data include the historical index of 2024Q1-Q3 of the #1 Jilong Plant and the index from May to September 2024 of  #2
Jilong Plant.
2 The gold ingot output in the table does not include the gold me tal which is recovered from gold-bearing materials, cyanide
slag smelting, etc.
– IIIA-279 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Processing and Metallurgical Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 218
11.1.3 Tailing Storage Facility
The existing tailings storage facility (“TSF”) of Zhuanshanzi Mine was put into operation in 1996, with
a maximum dam height of 21.7m and a total volume of about 40×104 m3. To make the TSF meet the
requirements of the current national laws and regulations on safety production, standards and norms,
and to meet the requirements for the storage capacity of the st ockpile after the expansion of the
processing plant, Inner Mongolia Mining Development Company Limited was commissioned to carry
out design for the TSF for renovation and expansion in 2012, a disposal method of “tailing filter press
- dry discharge” was adopted with all filtration wastewater returned to the processing plant for recycle.
The TSF is located in the main valley on the north side of the processing plant. The valley appears
from east to west, with a “U” shaped in the cross section, and the status of the TSF is shown in Figure
11-4. The dam height is 40m, with a total storage capacity of 1,440kt, which belongs to Grade 4 TSF,
with a total service life of 12 years. The TSF has accumulated about 1,398kt of tailings, with a
remaining capacity of about 42 kt. The remaining service life is about 3 to 5 months and the
preparatory work before the closure of the TSF is being carried out according to the design.
The new TSF is 1.2km northeast of the processing plant. It is c urrently in trial operation, which will
last for 3～6 months, and has not yet been officially put into use. The total height of the dam is 90m,
and the total capacity is 360.5×10 4m3 equals 228.4×104m3 of effective capacity. The service life of
new TSF is about 14.42 years. The site photos of the TSF are shown in Figure 11-5.
Figure 11-4: TSF of Jilong Project

Source: SRK site visit
– IIIA-280 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Processing and Metallurgical Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 219
11.1.4 Conclusions and Recommendations
The ore is of sulphide-bearing quartz vein type with characteri stics of simple mineral composition,
less variety and coarse grain-siz e. A process of whole ore cyan idation - zinc dust precipitation
(Merrill-Crowe) was adopted. SRK  believes that the processing f lowsheet is suitable for the
requirements of the ore properties, and the equipment are reasonable, and a satisfied gold recovery
rate was obtained with no major flaws.
The Project has two processing plants, which is the original 40 0tpd plant (i.e., #1 Jilong Plant) and
the new 600tpd plant (i.e., #2 Jilong Plant). The #2 Jilong plant was put into operation in June 2024
and has already reached its designed capacity until now.
The capacity of the existing TSF is close to the designed capacity while a new TSF with an effective
capacity of 228.4×104m3 is currently in trial operation, which will serve the processing plants for about
14.42 years.
11.2 Huatai Project
11.2.1 Processing and Metallurgical Testwork
The ore in this mining area is mainly auriferous pyrite-quartz vein type, and the main ore minerals
are native gold, pyrite, chalc opyrite, magnetite and hematite a nd the gangue minerals are mainly
quartz, sericite, feldspar, followed by chlorite, and graphite.
The gold minerals are predominately electrum and native gold, mainly occurrence in the form of gold
inclusions, fissured gold, and intergranular gold. The particle  size composition of gold in the ore is
fine with a particle size less than 0.01mm accounting for more than 90%, which makes it difficult to
dissociate.
In 2017, Huatai Mining commissioned Mineral Experimental Research Institute of Inner Mongolia to
conduct a laboratory processing testwork on this type of ore.
The gold grade of test sample is 6.22g/t, after grinding to -0.074mm accounted for 85% (P85=74μm),
a closed-circuit process of “one roughing + two cleanings + two  scavengins” was adopted to obtain
the gold concentrate with a grade of 149.31g/t and gold recovery of 95.06%, the test result is shown
in Table 11-4.
SRK believes that the ore of Honghuagou gold mine is easily beneficiated, and an ideal indicator can
be obtained by using a single flotation processing flowsheet, t he flowsheet structure is simple.
However, the particle size composition of gold is considered to be small, indicating that the grinding
fineness of -0.074mm accounting for 85% (P 85=74μm) in the one-stage grinding operation can not
be reached. It is recommended to consider using a two-stage clo sed-circuit process in the
construction design in the future. However, Huatai Metallurgica l Plant did not adopt flotation but
carbon-in-pulp (“CIP”) method for obtaining gold bullion on site.
Table 11-4: Test Results of Ore Sample from Huatai Mine
Product Yield（（%）） Au Grade （（g/t）） Au Recovery （（%））
Concentrate 3.96 149.31 95.06
– IIIA-281 –
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FOR THE PRC MINES


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Product Yield（（%）） Au Grade （（g/t）） Au Recovery （（%））
Tailings 96.04 0.32 4.94
Raw Ore 100.00 6.22 100.00
Source： Laboratory Process Test Study Report on Rock Gold Ore Processing of Honghuagou Mine, Inner Mongolia Autonomous Region, Aug
2017
11.2.2 Production Status o f Huatai Processing Plant
The Huatai processing plant, formerly known as the state-owned Chifeng Honghuagou Gold Mine
Processing Plant, was built in 1987, and the ore type is primary sulphide ore of auriferous quartz vein
type. The designed capacity of the processing plant is 200tpd, and a process of carbon-in-pulp (“CIP”)
was adopted to produce gold mud as the final product, which is then sent to the metallurgical plant
of Jilong Mining to produce gold ingots for sale. The average g rade of the ROM is about 2.63 g/t,
and the average gold recovery rate reaches over 92%.
Production Flowsheet
A traditional process of CIP was adopted by the processing plant of Huatai mining, which is
considered to be relatively rea sonable. The production process flowsheet is shown in Figure 11-5,
and specified as follows:
Crushing and Grinding
The crushing operation adopts a two-stage closed-circuit process. The feed size of ROM is less than
300mm and the size of the final crushed product is less than 14 mm. The grinding operation adopts
two-stage closed-circuit classif ication process, and the slurry  from the primary grinding process
enters the debris sieve for waste residue filtration, and then enters the hydro-cyclone group for
classification. The underflow of the hydrocyclones enters the s econdary grinding mill, while the
overflow enters to the debris sieve for waste residue filtration, and then enters the procedure of pre-
leach thickening. The final grinding fineness is -74μm accounting for more than 80% (P80=74μm). At
the same time, lime is added to the grinding system to adjust the pH value for the pulp.
CIP Process
 Agitation Leaching and Carbon Adsorption
The slurry is dewatered by the pre-leach thickener and then ent ers to surge tank, and the sodium
cyanide is pumped from the storage tank into the agitating tank for cyanide leaching by rubber pump.
The leaching concentration is about 42-45% with a leaching time  of 27 hours, the sodium cyanide
concentration of 0.03% and pH value of 10.5~11.5. The active ca rbon with a concentration of 15~
40g/L is added for absorption for about 22 hours .  After absorption, the slurry contained gold-loaded
carbon is fed to the carbon lifting screen through the airlifter to separate the gold-loaded carbon from
the slurry, and then sent to the desorption electrowinning operation after screening and washing.
 Gold Loaded Carbon Desorption
The gold-loaded carbon enters t he acid washing tank and is wash ed with hydrochloric acid for
inorganic impurities (mainly calcium salts) removal, then transferred to the desorption column, where
the gold is desorbed from the gold-loaded carbon by using the n ormal pressure and temperature
– IIIA-282 –
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FOR THE PRC MINES


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desorption method, and then enters the desorption pregnant solution. The unloaded carbon will be
returned to the CIP circuit for recycling after desorption.
 Electrowinning
The gold in pregnant solution is reduced to elementary substanc e in electrowinning cells and
precipitate on cathode steel wool. The cathode is periodically taken out and gold is eluted to obtain
gold mud. After filter pressing and drying, the gold mud is sen t to the smelting workshop of Jilong
processing plant. Fluxing agent is added. The gold mud is smelted in the smelting furnace and cast
into gold ingots.
 Tailings Decyanation
The tailings first enter the security screen to recover the broken carbon, and the broken carbon is
sent directly to the smelter on site. The undersized slurry is transported to the filter press workshop
for filter pressing and cyanide breaking. In 2018, three filter  presses were newly installed, and
cyanide residue was treated by circulating water purification s ystem. The tailings slurry is filter
pressed into cakes and then the cyanide residue filter cakes ar e washed with reagent to break the
cyanide to meet the discharge st andard. The filter cake after r eagent treatment enters the TSF for
storage, and the filtrate returns to the processing plant for recycling.
– IIIA-283 –
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FOR THE PRC MINES


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Processing and Metallurgical Assessment    Final
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Figure 11-5: Processing Flowsheet of Huatai Processing Plant

Mineral Processing Facilities and Main Equipment
The processing equipment of Huatai processing plant mainly includes crusher, vibrating screen, ball
mill and classifier, etc. in the process of crushing, grinding and classification; leaching tank,
adsorption tank, carbon screen and security screen, etc. in lea ching process; desorption column,
electric heater, electrowinning cell, etc. in desorption electr owinning process. The main processing
equipment are shown in Table 11-5.
SRK team conducted site visit on key workshops and production equipment of the processing plant.
The photos of the processing plant are shown in Figure 11-6. Du e to the long history of the plant,
most of the main equipment has been in use for nearly 30 years, with some problems of equipment
aging, resulting in high energy consumption. The overflow ball mill is used for two-stage grinding,
and the fine grinding capacity is not fully utilized. High weir spiral classifier has poor classification
effect, so SRK recommend adopting hydrocyclone group to replace the classifier for classification.
– IIIA-284 –
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FOR THE PRC MINES


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Processing and Metallurgical Assessment    Final
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Table 11-5: Main Equipment of Huatai Processing Plant
No. Equipment Name Specifications Power (kw) Quantity
1 Jaw Crusher PEF400×600 37 1
2 Cone Crusher PYD900 55 1
3 Vibrating Screen DZ1250×2500 1
4 Overflow Ball Mill MQY1500×3000 95 4
5 High Weir Spiral Classifier FLG-1200 2
6 Hydrocyclone Φ250 4（2 in operation 2 standby）
7 Leaching and Adsorption Tank Φ4000×4500 7.5 12
8 Thickener TNB-15 1
9 Desorption Electrolysis 1
Figure 11-6: Site Photos o f Huatai Processing Plant

Source: SRK site visit
– IIIA-285 –
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Historical Production Index
The historical production indicators of Huatai processing plant from 2021 to 2023 are shown in Table
11-6. As shown in the table, the gold recovery rate is over 92% . Through site visit and on-site
communication, SRK learned that in 2022 and 2023, due to the te chnical upgrade of the mining
system, the annual operating days of the processing plant were few, and the gold output seriously
declined. Until now, the processing plant is out of operation, so there are no production records in
2024.
Table 11-6: Historical Production Index of Huatai Processing Pl ant
Items Unit 2021 2022 2023
Processing throughput ktpa 58.51 19.12 1.62
Feed grade g/t 2.42 2.69 2.43
Gold recovery % 93.75 93.41 92.80
Gold output in ingot kg 132.75 48.02 3.65
11.2.3 Tailings Storage Facility
Huatai TSF was designed by Changchun Gold Design Institute Co., Ltd. of Ministry of Metallurgical
Industry in 1980. It is located in an open valley about 0.54 km east of the processing plant, which is
a valley-type TSF. The current status of the TSF is shown in Fi gure 11-7. In order to reduce the
pollution to the environment, the tailings press filtering proc ess was added in 2010 for dry storage
and seepage control was conducted to the TSF. China Metallurgic al Mining Anshan Metallurgical
Design and Research Institute Co., Ltd. was commissioned to supplement the design of TSF, which
was double checked and accepted by relevant government departments.
The TSF is designed with a total dam height of 35m and a total storage capacity of 200×104m3, which
is a Grade 4 TSF. At present, about 149.5 × 10 4 m3 tailings have been stored in the TSF, and the
remaining storage capacity is 50.5 × 104 m3, which has remaining service life of 11.7 years.
– IIIA-286 –
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Processing and Metallurgical Assessment    Final
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Figure 11-7: TSF of Huatai Mining

11.2.4 Conclusions and Recommendations
The ore is mainly of gold-bearing pyrite-quartz type, and the particle size of gold is fine, which makes
it difficult to dissociate.
Traditional CIP technology is adopted for gold recovering. In S RK’s opinion, it is reasonable and
stable. The satisfactory technical indexes have been achieved, with no major defects.
At the time of SRK site visit, the processing plant was in a state of shutdown. Huatai Mining informed
that the reason was that the ongoi ng technical innovation and t he production capacity expansion
were underway.
The TSF is in good operation condition, with no subsidence, displacement, landslide and vertical and
horizontal cracks.
11.3 Wulong Project
11.3.1 Processing and Metallurgical Testwork
The ore type is mainly disseminated bismuthinite mineralisation quartz veins, with useful components
of native gold and electrum. The ore minerals are dominated by pyrrhotite, with a small amount of
pyrite, occasionally with magnetite, chalcopyrite, galena, tell uric bismuth, and native bismuth. The
gangue minerals are quartz, followed by potash feldspar and alb ite, and a small amount of biotite,
chlorite, anorthite and calcite.
– IIIA-287 –
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The particle size of gold in the ore is fine, and it mainly occ urs as fracture gold and exposed gold.
The relationship between gold minerals and sulphides is relatively close, and the dissociation effect
of sulphide is good. Therefore, it is easy to enrich gold into gold concentrate by flotation under
suitable grinding fineness.
In 2021, Wulong Mining commissioned Beijing General Research Institute of Mining and Metallurgy
(“BGRIMM”) to carry out test stud y on the processing technology  of Wulong Mine, with the aim of
recommending a technically feasible and economically reasonable  processing flowsheet and
technical parameters, obtaining better mineral processing indexes, and providing a basis for design
and production.
A detailed flotation testwork was carried out. Based on the condition test, closed-circuit comparative
tests were carried out on three technological processes: “on-si te process” (one roughing, three
scavengings and three cleanings), “two roughings, two scavengings and three cleanings” and “stage
flotation (two products) proce ss". The gold content of test sam ple is 3.51g/t. The test results are
shown in Table 11-7.
Table 11-7: Test Results of ore sample from Wulong Mine
Flowsheet Product Yield
(%)
Au Grade
(g/t)
Au Recovery
(%)
One Roughing, Three Scavengings
and Three Cleanings Gold Concentrate 5.13 61.38 89.73
Two Roughings, Two Scavengings
and Three Cleanings Gold Concentrate 4.99 64.25 90.57
Stage Flotation Process
Gold Concentrate 1 2.29 125.96 80.86
Gold Concentrate 2 2.61 14.86 10.87
Gold Concentrate (Total) 4.90 66.80 91.73
Source: Processing Test Study Report of Wulong Gold Mine in Liaoning Province, January 2021.
The testwork results show that the gold concentrate with gold g rade of 61.38g/t and gold recovery
rate of 89.73% can be obtained by "on-site process" flotation. The gold concentrate with gold grade
of 64.25g/t and gold recovery rate of 90.57% can be obtained by the process of “two roughings, two
scavengings and three cleanings”. Gold concentrate 1 with gold grade of 125.96g/t and gold recovery
rate of 80.86% and gold concentrate 2 with gold grade of 14.86g/t and gold recovery rate of 10.87%
can be obtained by "stage flotation process". The total gold co ncentrate grade is 66.80g/t and the
total gold recovery rate is 91.73%. After comparative analysis of processing flowsheet indexes, it is
recommended to adopt "stage flotation process".
11.3.2 Production Status of Wulong Processing Plant
Wulong Mining built a new 3,000tpd gold flotation plant in 2020 , and it was put into operation in
January 2021. The old processing plant has ceased production. Grinding and separation are divided
into two series. The production capacity of the first series is 2,000tpd, and that of the second series
is 1,000tpd. The flotation process of "three-stage roughings, two-stage scavengings and two-stage
cleanings" is adopted for gold separation and the final product is gold concentrate for sale.
Production Flowsheet
The processing plant of Wulong Mining adopts the single flotati on process for gold ore processing.
The production process flowsheet is shown in Figure 11-8, and specified as follows:
– IIIA-288 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Crushing and Screening
The ore in the mining area is transported by car to the ROM bin  of the processing plant. A heavy-
duty plate feeder is set up under the ROM bin to feed the ore t o primary crushing. The primarily
crushed product is transported to the screening workshop by the belt conveyor for screening. The
oversize  product of the upper screen is returned to the second ary crushing buffer bin by the belt
conveyor, and is fed to the cone crusher by the heavy-duty mobi le belt feeder under the bin for
secondary crushing; The oversize product of the lower screen is returned to the fine crushing buffer
bin by the belt conveyor, and is fed to the cone crusher by the  heavy-duty mobile belt feeder under
the bin for fine crushing. The secondarily and finely crushed p roducts and the primarily crushed
product are combined and fed into the screening operation by belt conveyor, forming a closed circuit.
The undersize product is transferred to the fine ore bin by belt conveyor and enters the grinding and
flotation systems. The particle size of the fed ore is no more than 400mm, and the particle size of the
crushed product is -8mm after several renovation tests of the vibrating screen sieve pit.
Grinding and Flotation
The grinding operation adopts the two-stage closed-circuit proc ess. The fineness of the primary
grinding is 60% of -200 meshes (P 60=74μm), and that of the secondary grinding is 90% of -200
meshes (P90=74μm). The flotation operation adopt s the stage flotation process (3 roughings + 2
scavengings + 3 cleanings). After Roughing I of the grinding pr oduct, the roughing foam goes to
Cleaning I to produce concentrate product 1. The roughing taili ngs go to Roughings II and III, of
which the roughing foams go to Cleaning II and Cleaning III to produce concentrate product 2. The
two concentrate products are combined as the final concentrate.  The Roughing III tailings go to
Scavengings I and II to produce the final tailings.
Concentrate Dewatering
The concentrate is dewatered by two stages of "thickening + fil tration" mechanical dewatering
process. The moisture of the final gold concentrate is no more than 17%. After dewatering, the
concentrate enters the concentrate warehouse for packing and storage.
In order to ensure the quality of the backwater, the overflow of the thickener and pressure filter water
are pumped to the existing Φ14m thickener of the processing plant for precipitation, and the overflow
enters the backwater system.
Tailings Transport and Press Filtration
The flotation tailings are thickened and then pumped to the tailings filter-press workshop near the
TSF. After the press filtration,  the filter cake contains about  18% moisture, and then transported to
the TSF for storage by belt conveyor.
– IIIA-289 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Figure 11-8: Production Process Flowsheet of Wulong Processing Plant

Mineral Processing Facilities and Main Equipment
The Wulong processing plant consists of crushing and screening workshop section, grinding and
flotation section, concentrate dewatering section, tailings dewatering section and auxiliary production
section, and the main processing equipment is shown in Table 11-8.
SRK conducted site visit on key workshops and production equipm ent of the processing plant, and
the site photos are shown in Figure 11-9. The workshops are arr anged by steps to make full use of
the site topography, and the layout is compact and reasonable. The equipment adopts centralized
layout, to facilitate production operation, maintenance and management. The main factory plant is
equipped with elevators and visiting channels. The floor of the  workshops is clean and tidy. The
Run-of-mine
Secondary
Crusher
Primary
Crusher
Double deck screen
-+
Third
Crusher
Primary
Grinding
Hydrocyclone
+-
Hydrocyclone +
Roughing Ⅰ
Cleaning Ⅰ Roughing Ⅱ
Roughing Ⅲ
Cleaning Ⅱ
Scavenging Ⅰ
Scavenging Ⅱ
Tailings
-
Cleaning Ⅲ
Overflow
Filter Liquor
Filtration
Thickening
Overflow
Filter Liquor
Filtration
Thickening
Gold
Concentrate
Secondary
Grinding
– IIIA-290 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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whole process and equipment of t he processing plant have reached advanced, reasonable, safe,
efficient and environmental protection goals, The plant is built well and in very good condition.
Table 11-8: Main Equipment Li st of Wulong Processing Plant
No. Equipment Name Specification  Power
(kw) QTY. Remark
1 Jaw crusher CT3042 110 1 Primary crushing
2 Cone crusher TP350 250 1 Secondary crushing
3 Cone crusher TP450 315 1 Fine crushing
4 Double deck
vibrating screen 2YAQ3673SLF-AT 90 1
5 Ball mill MQY3650 1,250 2 Series Ⅰ
6 Hydrocyclone group Φ350-6 1 2 standby of Series Ⅰ
7 Hydrocyclone group Φ250-10 1 2 standby of Series Ⅰ
8 Ball mill MQY3245 800 2 Series ⅠI
9 Hydrocyclone group Φ350-4 1 2 standby of Series ⅠI
10 Hydrocyclone group Φ250-8 1 3 standby of Series ⅠI
11 Flotation machine XCFⅡ/KYFⅡ-40 75/55 5/8 Series Ⅰ roughing and
scavenging
12 Flotation machine XCF Ⅱ/KYFⅡ-16 45/30 3/2 Series Ⅰ cleaning
13 Flotation machine XCFⅡ/KYFⅡ-24 55/37 5/8 Series ⅠI coarse
scavenging
14 Flotation machine XCFⅡ/KYFⅡ-10 30/22 3/2 Series ⅠI cleaning
15 Thickener Φ18m 5.5 1 Concentrate thickening
16 Quick-open chamber
filter press 300m2 18.5 3 1 standby, with
automatic wetting flap
17 Thickener Φ60m 35.5 1 Tailings thickening
18 Quick-open chamber
filter press 800m2 23.7 7 1 standby, with
automatic wetting flap
– IIIA-291 –
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Figure 11-9: Site Photos of Wulong Processing Plant

Source: SRK site visit
Historical Production Index
The historical production indexes of Wulong processing plant fr om 2021 to September 2024 are
shown in Table 11-10. According to the data in the table, the actual annual processing throughput is
increasing year by year but have not reached the designed capac ity which is 900ktpa because the
lack of ore supply.  The average gold concentrate grade is 56.67g/t and recovery rate of about 91%.
Table 11-9: Historical Production In dex of Wulong Processing Plant
Items Unit 2021 2022 2023 2024 Q1-
Q3
ROM throughput kt 382.1 418.6 579.3 512.52
Feed grade g/t 2.48 3.42 3.53 3.25
Concentrate output kt 14. 62  25.13  33.08 25.19
Concentrate gold grade g/t 57.93 51.5 57.01 60.25
Gold recovery % 89.37  90.39 92.23 91.07
11.3.3 Tailings Storage Facilities
The Zhoujiagou TSF is located in the southwest of Wulong proces sing plant with the straight-line
distance of about 3.4km. It is a valley-type TSF, and the curre nt situation is shown in Figure 11-10.
The total dam height of the tailings dam is 45m, and the total storage capacity is 158.01×104m3 equal
to effective capacity of 142×104m3, which is a Class 4 TSF. At present, about 107.26×104m3 of tailings
– IIIA-292 –
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FOR THE PRC MINES


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have been piled up, and the remaining storage capacity is about 34.74×104m3. The site selection of
the new TSF has been completed and is under the stage of designing now .
Figure 11-10: TSF of Wulong Mining

11.3.4 Conclusions and Recommendations
As the ore comes from different mining areas, and the ROM prope rties are obviously different and
fluctuating, SRK suggests that  the reagent regime in the proces s of actual production should be
adjusted according to the production situation to obtain the optimal separating indexes.
SRK believes that the process flowsheet of Wulong processing pl ant is reasonable, and the overall
layout is reasonable and advanced with large-scale equipment, high automation level, energy saving
and high efficiency. The production and management personnel are of high quality, with standardized
management.
The Zhoujiagou TSF is close to closure. The site selection of the new TSF has been completed and
is under the stage of designing now.
– IIIA-293 –
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FOR THE PRC MINES


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11.4 Hanfeng Project
11.4.1 Processing and Metallurgical Testwork
Lishan Mine Testwork
The target mineral of the deep ore in Lishan Mine is mainly sph alerite, while the content of other
minerals such as pyrite, smiths onite, galena, cerussite and cha lcopyrite is relatively small. The
gangue minerals are mainly quartz, carbonate, and feldspar. Sph alerite is linked or wrapped with
gangue and other sulphides, and 58.50% of sphalerite is linked or wrapped with gangue.
In 2018, Hanfeng Mining commissioned Jilin Haorong Group Co., L td. to carry out a laboratory
processing testwork on the ore of Lishan Mine.
The zinc grade of the processing test sample is 3.11%, after grinding to -0.075mm accounted for 70%
(P70=75μm), a closed-circuit process of “1 roughing + 4 cleanings + 2 s cavengins” was adopted to
obtain the zinc concentrate with zinc grade of 47.46% and recov ery of 95.77%. The test result is
shown in Table 11-10. The experiment result shows that the flotation process can obtain the ideal
index on the deep zinc ore in Lishan deposit, which can provide  reference for the subsequent deep
ore separation.
Table 11-10: Test Results of Ore Sample from Lishan Mine
Product Yield (%) Zn Grade (g/t) Zn Recovery (%)
Concentrate 6.26 47.46 95.77
Tailings 93.74 0.14 4.23
Raw Ore 100.00 3.10 100.00
Source: Processing Test Study Report of deep zinc ore in Lishan  Deposit, Tianbaoshan Mining Area, Longjing City, Jilin Provinc e, October
2018.
Dongfeng Mine Testwork
The molybdenum ore of Dongfeng Mine is low sulfide quartz vein type, with disseminated grain size
distribution being uneven. Molybdenum minerals are mainly molyb denum sulfide minerals
(accounting for 97.39%), followed by molybdenum oxide mineral of powellite (accounting for 2.61%),
which mainly occurs in the cracks between ore grains, and a small part is wrapped in gangue or other
sulphides. Gangue minerals are mainly of feldspar, quartz and mica, accounting for over 98%. Other
gangue mineral content is little.
Hanfeng Mining commissioned Changchun Gold Design Institute to carry out two laboratory
processing test study on deep molybdenum ore and refractory molybdenum ore respectively in
December 2023.
The deep molybdenum grade of the processing test sample is 0.11 5%, after coarse grinding to -
0.074mm accounted for 75% (P75=74μm), a closed-circuit process of “1 roughing + 6 cleanings + 3
scavengins + cleaning 1 concentrate regrinding (P95=45μm)” was adopted to obtain the molybdenum
concentrate with molybdenum grade of 46.96% and recovery of 88.05%. The test result is shown in
Table 11-11. The experiment resul t shows that the flotation pro cess can obtain the ideal index on
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the deep molybdenum ore, which can provide reference for the subsequent large-scale resource
development and optimization of the existing mineral process.
Table 11-11: Test Results of Deep Ore Sample from Dongfeng Mine
Product Yield (%) Mo Grade (g/t) Mo Recovery (%)
Concentrate 0.22 46.96 88.05
Tailings 99.78 0.01 11.95
Raw Ore 100.00 0.115 100.00
Source: Processing Test Study Report of deep molybdenum ore, Changchun Gold Design Institute, December 2023.
The refractory molybdenum grade of the processing test sample is 0.126%. The ore adopts the stage
grinding and floating process, a nd the process structure is as follows: one stage grinding and
floatation (P 60=74μm) with one roughing + one scavenging; two stage grinding and
flotation(P90=74μm) with one roughing + three scavengings + six cleanings; two r oughing coarse
concentrate combined for cleaning and cleaning I concentrate re grinding (P 95=45μm). The
molybdenum concentrate is obtained with molybdenum grade of 46. 26% and recovery of 74.72%.
The test result is shown in Table 11-12.
Table 11-12: Test Results of Refractory Ore Sample from Dongfen g Mine
Product Yield (%) Mo Grade (g/t) Mo Recovery (%)
Concentrate 0.20 46.26 74.72
Tailings 99.80 0.02 25.28
Raw Ore 100.00 0.126 100.00
Source: Processing Test Study Report of refractory molybdenum ore, Changchun Gold Design Institute, December 2023.
11.4.2 Production Flowsheet
Lishan Processing Plant
The Lishan processing plant processes Cu-Pb-Zn polymetallic ore , which sources from Lishan and
Dongfeng mining areas. It adopts fl otation process, and the pro ducts are copper concentrate, lead
concentrate and zinc concentrate. The designed processing capac ity of Lishan processing plant is
1,500tpd, and the current productio n capacity has reaches 2,000 tpd through technical renovation.
The production process is described as follows:
Crushing
Lishan processing plant adopts two- stage closed-circuit process , with the raw ore feed size of no
more than 300mm and the product size of -12mm.
Grinding and Classification
The grinding process adopts a two-stage closed circuit grinding  system, divided into two series,
equipped with spiral classifier and hydrocyclone for classifica tion, with a final overflow fineness of -
200 mesh accounting for 62% to 76% and a concentration of 35% to 38%.
Flotation
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The flotation process is based on the principle of "mixed copper and lead flotation with priority", where
the mixed copper and lead concent rates are selected from the ra w ore before the copper and lead
concentrates are separated. The copper-lead mixed flotation pro cess structure is "one roughing,
three scavengings and five cleanings", while the copper-lead se paration flotation process structure
is "one roughing, two scavenging and five cleanings". The coppe r-lead mixed flotation tailings are
then for flotation of zinc to produce concentrate, with a proce ss structure of "one roughing, three
scavengings and five cleanings". The flotation process effectively avoids the use of copper sulphate
and other activators and inhibitors , prevents interaction, save s the dosage of chemicals, and
achieves better separation index.
Dewatering
Copper concentrate, lead concentrate and zinc concentrate all use a two-stage dewatering process,
with one stage of dewatering using a thickener and a discharge concentration of 40% to 50%; the
second stage of dewatering uses a cylindrical external filter, with a final concentrate moisture content
of 10% to 12%.
SRK believes that for copper-lead-zinc polymetallic ores, the flowsheet of Lishan processing plant is
mature and feasible.
Dongfeng Processing Plant
The Dongfeng processing plant mainly processes molybdenum ore a nd the history processing
capacity is 500tpd.  After optimizing the process, the production capacity reaches to about 700tpd. It
adopts flotation process, and the final product is molybdenum concentrate with grade of 40%～45%.
The plant ceased operation for years and restart production in July 2022. The production process is
described as follows:
Crushing and Grinding
Dongfeng processing plant adopts two-stage closed-circuit process, and the product size is -12mm.
The grinding process adopts a two-stage closed circuit grinding  system, divided into two series,
equipped with double spiral classifier for classification, with  a final grinding fineness of -200 mesh
accounting for 95% and a concentration of 38% to 41%.
Flotation and Dewatering
The molybdenum flotation process structure is "one roughing, three scavenging and eight cleanings,
phase bubble regrinding, fine tail desulfurization ". The molyb denum concentrate adopted a three-
stage dewatering process which is “thickening+filtration+drying ”. The final concentrate moisture
content is less than 4%.
11.4.3 Mineral Processing Facilities and Equipment
Lishan processing plant mainly consists of crushing and screeni ng plant, grinding plant, flotation
plant, concentrate dewatering plant and other plants, with lime milk preparation, technical inspection
stations and laboratories. The wh ole plant is built on a hill, making full use of whose natural
topography, with compact and reas onable equipment configuration  inside the plant, reducing
conveying pressure and shortening the length of the tape convey or and slurry pipeline. The main
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equipment of Lishan and Dongfeng processing plant is shown in T able 11-13 and Table 11-14
respectively , and the site photos are shown in Figure 11-11 and Figure 11-12.
Table 11-13: Main Equipment of Lishan Processing Plant
No. Equipment Specifications Power （（kW）） QTY.
1 Jaw Crusher CT2436 90 1
2 Cone Crusher TP450SH/C 315 1
3 Triaxial Horizontal Screen TTH6162 22 1
4 Belt Feeder B500X2500 24 6
5 Chute Feeder CG1210 15 1
6 Ball Mill MQCG2745 500 1
7 Ball Mill MQCY2.4*3.6 560 2
8 Ball Mill MQCG2430 320 1
9 Hydrocyclone TX350-GX*5  1
10 Hydrocyclone TX250-GX*5  1
11 Separator FGT-2.4 18.5 4
12 Flotation Blower CF220-1.34 360 2
13 Flotation Blower CF120-1.26 150 2
14 Flotation Machine XCF-16 585 13
15 Flotation Machine KYF-16 330 11
16 Flotation Machine BF-8 570 19
17 Flotation Machine BF-2.8 165 15
18 Flotation Machine KYFII-8 242 11
19 Flotation Machine BF-1.2 66 15
20 Flotation Machine BF-2.0 60 8
21 Flotation Machine XCFII-8 150 10
22 Thickener NZS-5 7.5 2
23 Thickener NZS-12 12 3
24 Ceramic Filter KS3-30 22 1
25 Ceramic Filter BY-18 22 2
Source: SRK collected.
Table 11-14: Main Equipment of Dongfeng Processing Plant
No. Equipment Specifications Power（（kW）） QTY.
1 Jaw Crusher PE600x900  1
2 Cone Crusher PYD1200  1
3 Vibrating Screen 1500x3000  2
4 #1 Ball mill MQG2130 155 1
5 #2 Ball mill MQY2124 130 1
6 #3 Ball mill MQY2124 130 1
7 Ball Mill MQY2430  1
8 Spiral Classifier Φ1500 7.5 3
9 Hydrocyclone FX250-G×5  1
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No. Equipment Specifications Power （（kW）） QTY.
10 Regrinding Ball Mill Φ900×1800 11 1
11 Hydrocyclone Φ150  2
12 1st Agitator Tank Φ2500 18.5 1
13 2nd Agitator Tank Φ2000 11 1
14 Flotation Machine XCF/KYF-8 22~15 13
15 Flotation Machine BF-2.8 11 8
16 Flotation Machine 5A 5.5 4
Source: SRK collected.
Figure 11-11: Photos of Lishan Processing Plant

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Figure 11-12: Photos of Dongfeng Processing Plant

Source: SRK site visit
11.4.4 Historical Production Index
The processing production records of Lishan and Dongfeng proces sing plant from 2021 to
September 2024 are shown in Table 11-15.  As can be seen, Lishan processing plant has decreased
its production throughput by almost 39% in 2023 compared to that in 2022, which is mainly attributed
to the implementation of technical modifications. The average C u, Pb and Zn recovery rate is of
53.32%, 64.49% and 88.20%, respectively.
The Dongfeng processing plant ceased operation for years and restart production in July 2022. The
actual production capacity has reached about 700tpd since May 2 024. Through the optimization of
the process flow, the molybdenum recovery rate was increased to  77%-85%, with an average of
about 79%.
Table 11-15: Historical Production Index of Lishan and Dongfeng  Processing Plants
Items Unit 2021 2022 2023 2024 Q1-Q3
(1) Lishan processing plant
Ore Milled kt 505.89 578.98 351.11 372.03
     Feed Grade (Cu) % 0.19 0.13 0.13 0.116
     Feed Grade (Pb) % 0.68 0.63 0.73 0.75
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Items Unit 2021 2022 2023 2024 Q1-Q3
     Feed Grade (Zn) % 2.12 2.02 1.71 1.52
Cu Concentrate Output t 2,932 2,015 1,439 1,396
     Concentrate Garde (Cu) % 20.16 18. 62 17.47 14.80
     Cu Recovery % 61.23 49.84  54.35 47.86
Pb Concentrate Output t 3,477 3,257 2,716 2,686
     Pb Concentrate Garde % 63.65 66. 75 68.00 64.75
     Pb Recovery % 64.47 59.60  71.69 62.19
Zn Concentrate Output t 19,905 21,882 11,287 10,291
     Zn Concentrate Garde % 47.18 47. 12 47.40 48.42
     Zn Recovery % 87.45 88.31  89.17 87.88
(2) Dongfeng processing
plant
Ore Milled (Mo) kt - 15.02 82.11 163.98
Feed Grade (Mo) % - 0.17 0.14 0.15
Mo Concentrate Output t - 41.71 206.48 442.00
Concentrate Garde (Mo) % - 43.45 40.64 44.33
Mo Recovery % - 71.69 67.57 79.74
11.4.5 Tailings Storage Facility
Lishan TSF was completed and put into operation in 1965, and in 2007 the Changchun Gold Design
Institute was commissioned to carry out the restoration design and renovation. The site is located to
the southeast of the Lishan processing plant, at a distance of about 3.2km, and it is a valley type
TSF. The total dam height of the TSF is 59.5m, with a total storage capacity of 1,164×104m3, which
is a class 3 storage facility. At present, a volume of 1,006×104m3 tailings has been stockpiled in the
TSF, with a remaining storage capacity of 158×10 4m3 and an expected remaining service life of 3
years. The Lishan TSF plan to expand the storage volume of tota l 2,146×104m3 with dam height of
80m to serve for both Lishan and Dongfeng plant.
The Dongfeng TSF is located to the south of Lishan processing plant, at a distance of about 1.5km.
The total dam height of the TSF is 74m, with a total storage capacity of 640×104m3 and is a class 3
storage facility. At pre sent, a volume of 130×10 4m3 storage capacity remained, an expected
remaining service life of 4.6 years.
The current situation of the Lishan TSF and Dongfeng TSF is shown in Figure 11-13.
– IIIA-300 –
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Figure 11-13: TSF of Hanfeng Mining

11.4.6 Conclusion and Recommendations
The Lishan processing plant mainly processes Cu-Pb-Zn polymetallic ore, which sources from Lishan
and Dongfeng mining areas. It adopts flotation process, and the  products are copper concentrate,
lead concentrate and zinc concentrate, with average recovery rates of 53.32%, 64.49% and 88.20% ,
respectively.
The Lishan plant is built on a hill, making a full use of the n atural topography, and the equipment
inside the plant is compact and reasonable.
The Dongfeng processing plant mainly processes molybdenum ore, and the history processing
capacity is 500tpd.  After optimizing the process, the producti on capacity reaches to about 700tpd
and the molybdenum recovery rate was increased to 77%-85%. It adopts flotation process, and the
final product is molybdenum concentrate with grade of 40%～45%.
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11.5 Jintai Project
11.5.1 Metallurgical Testwork
Kunming Metallurgical Research Institute (“KMRI”) and the Centre Laboratory of Yunnan Geological
and Mineral Exploration and Development Bureau (“ Yunnan Central Lab ”) and Jintai Mining
conducted metallurgical testwork on the Xidengping gold ore. The tests include the flowing aspects:
 Mineralogy
 Agitation Leaching
 Column leaching
 Selection of gold leaching agent and
 Industrial test of heap leach
The testing results of the sieve analysis of -33mm of Xindengpi ng ore by the KMRI showed 39.5%
of "slime", and the column leaching showed a serious permeabili ty problem. The results of the
physical properties of -25mm ore by the Yunnan Central Lab are shown in Table 11-16, and the
"slime" content was 25.62%, which is relatively high, and the t est report describe it as "average
permeability", which SRK understands as "not serious permeabili ty problems". Jintai Mining also
found slime and serious permeability problems in the ore by soaking the ore in tanks. During the site
visit, SRK found that the ores were highly oxidized.  Combined with the test results of the high slime
content of the ore and the high lime dosage, SRK recommends pelleting heap leaching with alkaline
cement or lime as the binder.
Table 11-16: Ore Physical Property Test Results
Item Unit Results
Density g/cm3 2.60
Heap Density g/cm3 1.42
Angle of Repose degree 40
Hardness 6.3
Moisture Content1 % 0.55
Slime Content % 25.62
Permeability coefficient2 m/d 1.30
Moisture Absorption Rate % 17.96
Note:
1 The Moisture Content was tested at the original ore-2mm particl e size, and the rest of the parameters were measured at
the original ore-25mm particle size.
2 The permeability coefficient was tested at a spray intensity of 10 L/m2·h.
In order to verify the feasibility of gold extraction by heap leaching, Jintai Mining conducted industrial
tests of heap leaching at the mine site from January 2014 to February 2015. The industrial test was
carried out in three phases, with the test stacked ore grade ranging from 0.3 to 2.0g/t, with an average
of 1.06g/t. The test heap area was about 24,000m2 and the total amount of ore heap during the test
period was about 160,000t. A crushing process with two-stage open circuit and pre-screening before
fine crushing was used to crush the ore to less than 50mm, which was transported by car to the leach
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pad for  stacking, with the initial test ore stacking height ra nging from 1 to 2.5m and the later ore
stacking height  ranging from 5 to 15m. Leaching by leaching re agent solution spraying, the test
spraying intensity was 13-20 L/m 2·h. The leaching period was about 3 months, and the dosage of
leaching reagent was stabilized at about 150g/t and the dosage of lime was stabilized at about 4.2kg/t,
which was much lower than the dosage of column leaching in the laboratory. The average gold
leaching rate during the industrial test was about 80%, it is a satisfactory result, confirming that heap
leaching method was feasible for Xidengping Gold Mine.
11.5.2 Jintai Heap Leaching Plant
GOCOM Engineering Design Co., Ltd. completed the Preliminary Design of Eryuan Jintai Mining
Development Co. Ltd. For 140,000t/a Open Pit Mining Project at  Xidengping Gold Mine in Eryuan
County in October 2022, which was designed maximum size of stacked or e is 35mm and the heap
was constructed by truck and bulldozer. The ore heap is constructed in multiple layers, each layer is
7m high, and when the previous layer of leaching is finished, t he next layer is directly constructed
without moving away the first one, until 6 layers. The heap was leached by spraying with 0.15%~0.20%
Jinchan Gold Leaching Agent. The designed gold leaching rate is  86%, the final product is gold-
loaded carbon, with the heap leaching comprehensive recovery ra te of 85.05%. The GOCOM
Preliminary Design is the basis of the current heap leach plant  construction at mine, and also the
basis for this report.
The construction of Jintai Heap Leaching Plant was completed and put into operation in October
2023. The project included the restoration of the original crushing production line and solution ponds,
as well as the construction of new solution ponds and water and electricity supply facilities. As of 30
September 2024, leaching has been completed on the D1 to D6 ore  heaps, leaching on the D7-1
and D7-2 ore heaps is underway, and D8 ore heap is under stacking. The total amount of ore in the
D1 to D6 heaps that has completed leaching is 527 kt, averaging grade of 0.69g/t Au, yielding 271.6
kg of gold (carbon-loaded gold), with an average gold recovery rate of 74.71%. Leaching on D7-1
and D7-2 heaps are currently ongoing, with a total ore amount of 54,689 t, averaging grade of 0.81g/t.
The main technical risks are the coarse particle size of the or e feeding the heap and the poor
permeability of the heap. SRK recommends changing the crushing process from open circuit to
closed circuit, reducing the crushed particle size to less than  25 mm, and using cement or lime for
pelleting. Then, use a belt conveyor to transport the pelleted ore and build the heap, thereby
improving the heap's permeability. SRK believes that controlling the ore particle size and enhancing
heap permeability are key measures to ensure gold recovery rates.
11.5.3 Heap Leaching Process
The designed process mainly includes three systems of ore crushing, heap leaching and adsorption,
and the final product is gold-loaded carbon with a gold grade b etween 2000g/t to 4000 g/t. Jintai
Mining entrusts other party to processing the gold-loaded carbon (elution - electrowinning - smelting),
to produce a final product of Gold Dorè. The gold stripped carb on will be returned to the adsorption
system. The heap leaching process is shown in Figure 11-14 and illustrated as follows
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Ore Crushing
A two-stage open-circuit crushing process is used to crush the ore to -35mm. The maximum particle
size of the open-pit ore is 500mm, which is transported by car to the ROM bin or ore stacking area
in the crushing workshop of the processing plant. Then the mate rial less than 100mm is screened
out by a grizzly feeder, and the oversize material is fed to a primary jaw crusher. The undersize
material of the grizzly feeder and the coarsely crushed product are fed to a vibrating screen to screen
out materials less than 35mm, and the oversize material of the screen is fed into a secondary jaw
crusher. The finely crushed product is combined with the undersize material and transported by truck
to the leach pad for stacking.
Heap Leaching Site
The heap leaching site covers an area of 7.24hm2 (72,400m2) and is located about 150m to the south
of the open pit of Orebody V1. It is a gentle slope of medium a nd low mountains, which requires
slope cutting to reduce the gradient. The longitudinal slope gradient of the heap leaching site is finally
determined to be 5%-10% and the lateral slope to be 4%-5%, to reduce the earthwork volume of the
slope cutting engineering. In order to prevent uneven settlement, the filling section adopts the bedded
earth rolling method, with a compaction coefficient of no less than 0.97. In order to prevent the impact
of groundwater on site stability, a groundwater collection and drainage system is installed under the
leach pad. The groundwater colle ction and drainage system is lo cated below the anti-seepage
system, and the burial depth is not less than 1.5m, that is, the sand and gravel blind drain is arranged
in the base, and after the collection infiltration of the sand reverse filter layer, the groundwater is
discharged to the downstream sedimentation pond by the DN200 ul tra-high molecular weight
polyethylene drainage pipe in the gravel layer, which is used as production water, or discharged after
the detection reaches the environmental emission standard.
Leach Pad Laying
The durable bottom pad is a compound pad composed of 4,800g/m 2 sodium-based bentonite
impermeable blanket (GCL) + one layer of 2mm-thick HDPE geomemb rane. A gradient of not less
than 3% is set when the bottom pad is laid, to facilitate the l each solution flowing into the collection
ditch along the bottom slope, and the DN100 ultra-high molecular weight polyethylene drainage pipe
is laid in the direction of downstream water to dredge the liquid flow. A sand gravel layer of 2-10mm
and 16-32mm with a thickness of 300-500mm is laid on the geomembrane as an ore heap percolation
drainage layer and a protective bottom pad to ensure that the leach solution can smoothly penetrate
into the bottom of the ore heap and flow into the collection pond through the collection facility. After
completion of the bottom facilities of the leach pad, the ore stacking work begins.
Ore Stacking
The crushed ore (-35mm) is transported directly to the leach pad by car. The truck is equipped with
a bulldozer to stack the ore st acking, and the excavator is use d to turn the ore stacking and shape
it. It adopts a zonal and layered stacking method, with a layer height of 7m. After the completion of
ore stacking, the surface layer of the ore stacking compacted by vehicles is loosened for 3-4m by an
excavator to facilitate the penetration of the leach solution. According to the terrain around the ore
stacking ground, grooves are laid with a slope of 2-5% to facil itate the collection of leach solution,
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and the collected leach solution flows into the sedimentation p ond and the pregnant leach solution
pond. It adopts a permanent heap leach yard without moving away the leached heap.
Laying of Solution Distribution Pipes
After the completion of ore stacking in each zone, a solution d istribution pipe network is laid on the
top of the heap, and the solution distribution is carried out b y rotating-swing spray nozzles (the
Senninger spray nozzles). The grid of the nozzle is generally 4 ×4m. A regulating valve is set at the
connection between the main pipe and the branch pipe to control  the flow and troubleshooting of a
certain part of the ore stacking.
Alkaline Washing
At the time of ore stacking, a certain amount of lime is added in advance. When the ore stacking is
washed with water, the pH value of the effluent may reach 9-10.  If it cannot reach the specified pH
value, a certain amount of caustic soda should be added until t he pH value of the effluent reaches
11-11.5, after which stop washing, and then spray it with a gold leaching agent solution.
Spray Leaching
The solution with a concentration of 0.15%-0.20% and a pH= 1-11.5 is prepared in the barren solution
pond with the Jinchan gold leaching agent as gold leaching reagent. The prepared leach solution is
pumped from the barren solution pond to the spray pipe network,  through which the ore stacking is
sprayed and leached. The spray intensity is 6L to 30L/m 2·h, and the continuous time of each spray
is 1h with the interval time of 0.5h, which can be adjusted acc ording to the process stage or the
actual site situation.
The sprayed leaching solution permeates the heap from surface to bottom while the gold is dissolved
into the leaching solution, and flowing out of the ore heap flo ws into the pregnant leach solution
collection pond and is pumped to the pregnant leach solution pond after precipitation. The pregnant
leach solution is then discharged to the barren solution pond a fter being adsorbed by carbon. The
returned barren solution should be added with leaching agent ac cording to the analysis results to
ensure the concentration of gold leaching agent and pH value of  the leaching solution. The ore
stacking is continued to be sprayed to form a spray-leach-adsorption cycle until the end of leaching.
Active Carbon Adsorption
Active carbon is used as gold and silver adsorbent and loaded into the adsorption column. The gold
and silver in the pregnant leach solution are adsorbed and leached by five adsorption columns in
series. After the gold load of the active carbon reaches the designed adsorption capacity (4,000g/t),
it is discharged through the bottom carbon discharge valve, and then sampled, weighed and stored
after the surface moisture is dried. The gold-loaded carbon is the final product on site. While Jintai
Mining entrusts other party to processing the gold-loaded carbon (elution - electrowinning - smelting),
to produce a final product of Gold Dor è. The gold stripped carbon will be returned to the adsorption
system. Jintai tells SRK the stripped carbon will be recycled three times and then will be sold.
– IIIA-305 –
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Washing and Detoxification
The designed leaching cycle is 50-60 days.  After the completion of leaching, the ore heap is sprayed
and washed with a weak alkaline limewater to wash out the residual leaching solution containing gold
and gold leaching agent, and finally it is sprayed and washed w ith the alkaline bleaching powder
solution to detoxify the ore heap.  The washing-purification tim e is about 15-20 days. After the
washing and detoxification of t he ore heap is completed, the pipe network is dismantled, the
impermeable bottom pad is re-laid on the top of the ore stackin g, and then the second layer of the
ore heap is stacked and leached until the stacking and leaching of the 6th layer ore heap is completed.
After the final leaching, the disinfected leaching residue is s tored in situ and reclaimed by covering
soil.
Figure 11-14: Heap Leaching Process Flowsheet of Xidengping Gold Mine
Vibrating Screen
Run-of-Mine
Grizzly Feeder
Receiving Hopper
Primary Jaw Crusher
-35mm Secondary Jaw Crusher
+35mm
Ore Stacking
+100mm
-100mm
Lime
Heap Leaching
Pregnant Leach Solution
Active Carbon Adsorption
Barren Solution
Reagent
Gold Loaded Carbon
Elution-Electrowinning-Smelting
Gold Dorè
Stripped Carbon
Regeneration
Washing &
Cyanide Deconstruction

Source: SRK
– IIIA-306 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Processing and Metallurgical Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 245
11.5.4 The Facilities and equi pment of Heap Leaching Plant
A complete crushing system, solution pond system and adsorption  system are left over from the
original heap leaching test pl ant. Although the facilities and equipment of these systems are small,
they can still be used after maintenance. GOCOM Preliminary design to make use of them, and
added some solution pond, water supply and drainage facilities and laboratories, spare parts
warehouse, reagent storage and products warehouse. The main production facilities and equipment
designed are shown in Table 11-17. Figure 11-15 shows the key facilities of the heap leaching plant.
Table 11-17: Heap Leaching F acilities and Equipment
 Equipment Equipment name and
specification
Installed
power
（（kW））
Quantity Remarks
 Jaw crusher PE600×900 55 1 Used equipment
 Vibrating screen SZZ-1545 11 1 Used equipment
 Jaw crusher PEX300×1300 55 1 Used equipment
 Adsorption column Ф2000×3000mm   15 New
 Pregnant Solution Pond  15×8×3m, 300m3   2 Used equipment
 Barren Solution Pond  Ф 21×3m, 900m3   1 Used equipment
 Barren Solution Pond  Ф 15×3m, 450m4   1 New
 solution collecting pond 18×6×3m, 300m3   1 New
 Heap leaching site 72,400m2   1 New construction
Source：Jintai provided and SRK site visit
– IIIA-307 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1133 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Processing and Metallurgical Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 246
Figure 11-15: Main Facility Photos of Xidengping Heap Leach Plant
Leached Heap
Heap in Leaching
Leached Heap
PLS Collection/Transfer Ponds
& Flood Control Ponds
PLS Ponds Active Carbon Adsorption
Column Trains
Barren Solution Ponds
Crushing Workshop

Source: SRK site visit
11.5.5 Designed technical ind ex and production performance
The technical index of heap leaching designed by GOCOM Preliminary design is shown in Table
11-18, and the scale of heap leaching is 140,000 t/a, with 0.83 g/t of feed grade, the overall gold
recovery rate is 85.05%, the final product is gold-loaded carbon with the gold grade of 4,000g/t, the
annual output of gold (contained in gold-loaded carbon) is 98.83kg.
– IIIA-308 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1134 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Processing and Metallurgical Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 247
Table 11-18: Designed Technical Index of Heap Leaching
 Item Unit Quantity
 The tonnage of ROM t/a 140,000
 Ore size of ROM mm 500～0
 Particle size of stacked ore mm 35～0
 Grade of ROM g/t 0.83
 Gold content of ROM kg/a 116.2
 Leaching rate % 86
 Washing rate % 99
 Adsorption rate % 99.9
 Comprehensive Recovery Rate1 % 85.05
 Leaching period day 90
 The quantity of leaching residue t/a 140,000
 The grade of leaching residue g/t 0.124
 Gold content of leaching residue kg/a 17.37
 The quantity of gold loaded carbon t/a 24.71
 The grade of gold loaded carbon g/t 4,000
 Gold content in loaded carbon kg/a 98.83
 The consumption of lime kg/t 4.5
 The consumption of Jinchan gold leaching agent kg/t 0.35
 The consumption of bleaching powder kg/t 0.55
Note:
1 Overall recovery rate = Leaching rate × washing rate × Adsorption rate
The heap leaching plant was completed in October 2023. It includes the maintenance of the existing
crushing equipment and the construction of the plant building, reinforcement and anti-seepage
treatment of the existing solution pond, construction of new solution ponds, construction of the heap
leaching site, and construction of basic infrastructure.
As of 30 September 2024, eight heaps (D1, D2, D3, D4, D5, D6, D 7-1 and D7-2) were constructed
and six of the heaps were leached, and D8 ore heap is under con struction. The ore quantities and
gold leaching amounts for each heap are shown in Table 11-19 an d the gold recovery curves are
illustrated in Figure 11-16.
For the six heaps where leaching has been completed, the overal l gold recovery is 74.71%. The
actual gold recovery is much lower than the designed 85.05%
SRK observed on site that the pregnant leach solution (PLS) was  turbid and had low grade,
speculating two possible reasons:
 High clay content in the ore, leading to poor permeability;
 Excessive spray intensity of the leach solution, causing the leach solution to erode the heap.
SRK also noted on site that to improve the permeability of the heap, the actual particle size of the
ore in the heap was around -100mm, much larger than the designe d -35mm. Although the coarser
particle size can improve permeability, it will significantly impact the recovery rate. SRK recommends
maintaining the designed ore crushing particle size and adoptin g pelleting operations to ensure the
permeability of the heap. Jintai told SRK, the pelleting operat ion has implemented from July 2024
and applied in D7-2 Heap.
– IIIA-309 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Processing and Metallurgical Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 248
Table 11-19: Heap Leaching Production Performance, as of 30 September 2024
Item Unit D1 D2 D3 D4 D5 D6 Total
Ore quantity t 51,110 71,814 112,964 109,249 107,505 74,386 527 ,027
Average grade g/t 0.77 0.87 0.69 0.59 0.59 0.76 0.69
Gold content in heap g 39,354 62,485 78,290 64,412 62,771 56,20 6 363,519
Leaching period day 41 50 126 126 110 73
Cumulative gold load in carbon g 34,557 48,503 55,226 52,568 25 ,448 55,293 271,595
Cumulative recovery rate1 %     87.81     77.62     70.54    81.61     40.54     98.38     74.71
Source: SRK calculated based on data provided by Jintai Mining
Note:
1 The recovery rate is calculated according to the accumulated go ld load in carbon and the amount of metal in heap. Since
the later period PLS of an ore heap is used as the leaching sol ution of the next ore heap, and the gold content in the PLS
also enters in the next ore heap, so the recovery rate of a single ore heap does not accurately reflect the real leaching
situation, while the total recovery of all the ore heaps can reflect the overall leaching situation.
Figure 11-16: Heap leaching Recovery Curve for Xidengping Mine

Source: drawn by SRK according to Jintai's "Gold-loaded Carbon Production Report"
11.5.6 Conclusion and Recommendation
 The designed maximum size of stacked ore is 35mm, and the heap is continuously stacked
without moving away the leached or e, with a total of 6 layers s uperimposed, and the average
height of each layer is 7m. Due to the particle size is an impo rtant factor affecting gold leaching
rate, SRK recommends using closed circuit for fine-crushing operation to reduce the particle size
of stacked ore to 100% less than 25mm. The permeability of ore stack is the key factor affecting
the success or failure of heap leaching. SRK suggests that cement and leaching reagent solution
should be used for pelleting to avoid argillization, and belt c onveyors and stacking conveyor
should be used to build ore stack to avoid compaction and ensure the permeability of ore heap.
 -
 10
 20
 30
 40
 50
 60
 70
 80
 90
 100
26-Oct-23
25-Nov-23
25-Dec-23
24-Jan-24
23-Feb-24
24-Mar-24
23-Apr-24
23-May-24
22-Jun-24
22-Jul-24
21-Aug-24
20-Sep-24
20-Oct-24
Gold Recovery (%)
Leaching Time (Day)
D1 to D6 Overall Recovery Curve
– IIIA-310 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Processing and Metallurgical Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 249
Pelleting with cement and leaching reagent solution can provide  sufficient protective alkali in
advance, and save the pre-alkaline washing operation, shorten the leaching period and improve
the gold leaching rate.
 It is reasonable to construct groundwater seepage control and d rainage system by cutting
treatment of heap leaching site as stepped type. It is reasonab le to lay the liquid collection
drainage pipe network system on the bottom pad of the ore heap,  which can timely export the
leaching solution to the ore stack and reduce the scouring of t he ore at the bottom of the stack.
During the site construction, it is recommended to rationally arrange the location and network of
the system according to the terrain conditions.
 The design scale of heap leaching is 140,000 t/a, the average grade of ore is 0.83g/t, the overall
recovery rate of gold is 85.05%, the final product is gold-loaded carbon, the gold grade of loaded
carbon is 4,000g/t. The Xidengping gold ore is amenable to heap leach process and the leaching
rate is 85%~91% in column leaching test, SRK believes that the overall recovery of 85% gold
can be reached or even exceeded under the condition of ensuring the permeability of ore heap.
SRK observed on-site that the maximum ore size feeding the heap  was approximately 100mm,
which is much larger than the designed ore size for heap leachi ng. Additionally, there are
permeability issues with the ore heap, which will result in the gold recovery rate not meeting the
designed specifications. SRK suggests modifying the existing open-circuit crushing process to a
two-stage closed-circuit process, reducing the ore to below 25mm, and adding a drum granulator
to granulate the crushed ore, and using a belt conveyor to build the heap.
 Heap leaching has the characteristics of flexible scale, low in vestment, low cost and short-term
benefit, and Xidengping ore is suitable for heap leaching. The discovery of V4 orebody makes it
possible to expand the scale of heap leaching to 1 million t/a. The current scale of 140,000 t/a is
feasible by mainly using the facilities and equipment of the original pilot plant. Jintai Mining plans
to build a second crushing workshop to expand production capaci ty. SRK recommends using a
closed-circuit crushing process to reduce the ore to less than 25mm and pelleting the crushed
ore to improve the heap's permeability. SRK believes that this can achieve the designed recovery
rate of 85%.
 The final product of the mine is gold-loaded carbon, Jintai Min ing entrusts other party to
processing the gold-loaded carbon, to produce gold doré, SRK su ggests that a smelting
workshop should be built in the mine to use a processing device of "high-temperature elution and
homothermal electrowinning " to produce Gold Dorè.


– IIIA-311 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Project Infrastructure    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 250
12 Project Infrastructure
12.1 Location and Access
12.1.1 Jilong Project
The Jilong gold project is located about 21km west of Aohanqi o r 58km west of Chifeng City, Inner
Mongolia. The Zhuanshanzi gold mine is approximately 45km away from the Pingzhuang Station of
Yebaishou - Chifeng Railway in the southwest and only 15km away from the Xiaohe Station of Beijing
–Tongliao Railway in the north. There are gravel roads connecting the mine to the railway stations
and main paved roads.
12.1.2 Huatai Project
The Huatai gold project, including the Lianhuashan gold mine, H onghuagou gold mine and
Pengjiagou gold mine, is located approximately 33~38km west of Chifeng City, Inner Mongolia. Three
operating mines are all within 3 to 10km away from the Honghuag ou Station of Beijing – Tongliao
Railway. Chifeng City has extensi ve networks of railway line and well paved highways. There are
gravel roads connecting these mines to the railway station and main paved roads. Access to these
properties is convenient.
12.1.3 Wulong Project
The Wulong gold project is located about 15km west of Dandong C ity or 38km south of Donggang
City, Liaoning Province. Access to the Wulong gold mine is very  convenient. The Dandong-Dalian
highway is 11km away from the mine in the southeast. There are gravel roads connecting the mine
to the main paved roads.
12.1.4 Hanfeng Project
The Jilong lead-zinc project is located approximately 42km of n orthwest of Longjing City, Jilin
Province. Access to the project area is excellent. The Changchu n-Tumen Railway and National
Highway G302 pass through Laotougou Township in the southeast o f Tianbaoshan mine area.
Laotougou Town is just 15km southea st of the project’s properti es and there is a cement road
connecting Laotougou Town and the project site.
12.1.5 Jintai Project
Jintai project is located about 54km road away Southwest to Ery uan county, Dali Bai Autonomous
Prefecture, Yunnan Province. Access to Jintai project is very c onvenient. The local downtown
Liantiexiang is about 3km from mine site and the connected with  national road to Eryuan county
about 51km. the downtown to Dali is about 106km.
– IIIA-312 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Project Infrastructure    Final
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12.2 Power Supply
12.2.1 Jilong Project
Jilong Mining has built a 4,000kVA+6,300kVA general step-down substation in the first mining area
of the Zhanshanzi Gold Mine and the power supply is Yuanbaoshan 66kV, a second substation. The
power supply in the mining area is sourced from the general ste p-down substation. A 10kV
transmission line is connected to the power distribution room in the mining area through LGJ-95mm2
steel-cored aluminum stranded wires. The power supply meets production needs.
12.2.2 Huatai Project
The power supply for the Huatai project is sourced from the Northeast Power Grid, and the industrial
10kv high-voltage line has been connected to the Lianhuashan and Honghuagou gold mining areas,
which can meet both production needs.
12.2.3 Wulong Project
Wulong operating gold mine is an old mining area with complete power supply facilities. The
Northeast Power Grid runs through the whole area, and the power supply is sufficient.
12.2.4 Hanfeng Project
There is a 110kV high-voltage dedicated line for Tianbaoshan operating mine, and the power supply
can fully meet the production needs.
12.2.5 Jintai Project
Jintai project is located about 54km by road Southwest to Eryua n county, Dali Bai Autonomous
Prefecture, Yunnan Province. Access to Jintai project is very c onvenient. The local downtown
Liantiexiang is about 3km from mine site and the connected with  national road to Eryuan county
about 51km. the downtown to Dali is about 106km.
The power supply for the Jintai project is sourced from the 35k V power station of Liantiexiang town
which is a station to the China Southern Power Grid. The industrial 10kv high-voltage line has been
connected to the project about 1.8km away, which can meet both production needs. Residential
electricity is supplied as the mine is not constructed, during site visit. Figure 12-1 shows the power
station and the connection of power line.
– IIIA-313 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Project Infrastructure    Final
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Figure 12-1: Power Station of Liantiexiang

12.3 Water Supply
12.3.1 Jilong Project
Water for production and domestic use is sourced from undergrou nd water with a water volume of
70 cubic meters per day (“m3/d”) per water well
12.3.2 Huatai Project
Water for production and domestic use is sourced from underground water (electromechanical wells),
and the water volume is relatively sufficient.
12.3.3 Wulong Project
The water for mine production and surrounding residents is taken from the special water intake area
of the mining area, and water resources are relatively sufficient.
12.3.4 Hanfeng Project
The production water supply is from the water source of Huxiant ang water source on the southeast
side of the ore processing plant and the underground water of Lishan Pit.
Huxiantang Water Source: there is a 6m×12m water intake pumping station built at the water intake
point, using three sets (one for backup and two for use) of wat er intake pumps D155-30 ×9 (Q=72
～126m3/h, H=270m, N=200kW), through a D300mm iron pipe through an air -raid shelter and the
– IIIA-314 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Project Infrastructure    Final
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water source pipeline at the m outh of Dongfenggou, and then dir ectly pump water to the high-level
water tank of the ore processing plant. The straight-line distance of water supply is about 5,000m.
In addition, the backwater from the Lishan tailings pond is als o transported to the high-level water
tank of the concentrator through the pump station.
Lishan Pit Gushing Water: the gushing water from the Lishan pit , through four-level drainage
pumping stations, are pumped to the surface. The water supply capacity is 500m3/d.
12.3.5 Jintai Project
The production water is planned sourced from the nearby river o f Heihui. A pump station and
powerhouse are planned to construct. Pipeline connecting water source and head tank of processing
plant is also planned. the water source location is shown in Figure 12-2.
Figure 12-2: Planned Water Source Point along Heihui River

The domestic water is source from the spring pond and the water plant of Xidengping village, which
is the source for local community. The pipeline has been constructed along the road to the mine site.
– IIIA-315 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Environmental Studies, Permitting, and Social or Community Impact  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 254
13 Environmental Studies, Permitting, and Social or
Community Impact
13.1 Environmental, Permitting, a nd Social or Community Review
Objective
The objective of this due diligence review is to identify and o r verify the existing and potential
Environmental, Permitting, and Social or Community liabilities and risks, and assess any associated
proposed remediation measures for the Project.
13.2 Environmental, Permitting, a nd Social or Community Review
Process, Scope, and Standards
The process for the verificati on of the environmental complianc e and conformance for the Project
comprised a review and inspection of the Project’s environmental management performance against:
 Chinese national environmental regulatory requirements; and
 World Bank/International Finance Corporation (“ IFC”) environmental standards and guidelines,
and internationally recognised environmental management practices.
The methodology applied for this environmental review of the Pr oject consisted of a combination of
documentation review, site visit, and interviews with Company t echnical representatives. The lasts
site visit for the environmental review was undertaken in May 2024.
13.3 Status of Environmental Impact Assessment
The basis of environmental policy in China is contained in the 2018 Constitution of the People’s
Republic of China. Pursuant to Article 26 of the Constitution, the state protects and improves the
environment in which people live and the ecological environment . It prevents and controls pollution
and other public hazards. The state organizes and encourages af forestation and the protection of
forests.
The following are other Chinese laws that provide environmental  legislative support to the Minerals
Resources Law of the People’s Republic of China (2019) and the Environmental Protection Law of
the People’s Republic of China (2014):
 Environmental Impact Assessment (“EIA”) Law (2018).
 Law on Prevention & Control of Atmospheric Pollution (2018).
 Law on Prevention & Control of Noise Pollution (2021).
 Law on Prevention & Control of Water Pollution (2017).
 Law on Prevention & Control Environmental Pollution by Solid Waste (2020).
 Forestry Law (2021).
 Water Law (2016).
 Land Administration Law (2019).
– IIIA-316 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Environmental Studies, Permitting, and Social or Community Impact  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 255
 Protection of Wildlife Law (2023).
 Regulations on the Administration of Construction Project Environmental Protection (2017).
In accordance with Chinese legi slation the Project will be subjected to a comprehensive EIA to
assess the environmental impacts  of the proposed development on  the human and natural
environment prior to the commencement of mining operations.
The details of the EIA reports and approvals for each project are presented in the tables below.
13.3.1 Jilong Project
Table 13-1: Details of the EIA Reports and Approvals for the Jilong Project
Project Produced By Production
date  Approved By Approval
date
Chifeng Jilong Mining Ltd.
Gold Mine Mining and
Processing Project (400 tpd)
Chifeng City
Environmental Science
Institute
September,
2007
Chifeng City
Environmental
Protection Bureau
January 30,
2008
Zhuanshanzi Gold Mine (No.
4, 5, 6, 7 orebody) Mining
Project (200 tpd)
Hebei Deyuan
Environmental Protection
Ltd.
May, 2019
Chifeng City Ecology
and Environmental
Bureau
December
30, 2019
Zhuanshanzi Gold Mine
Processing Expansion Project
Inner Mongolia
Guxincheng
Environmental Technology
Ltd.
February,
2023
Chifeng City Ecology
and Environmental
Bureau
April 18,
2023
13.3.2 Huatai Project
Table 13-2: Details of the EIA Reports and Approvals for the Huatai Project
Project Produced By Production
date  Approved By Approval
date
Chifeng Huatai Mining Ltd. Gold
Mine Mining and Processing
Expansion Project (0.06Mtpa)
Chifeng City
Environmental
Science Institute
May, 2007
Chifeng City
Environmental
Protection Bureau
June 6, 2007
Chifeng Huatai Mining Ltd.
Honghuagou No.1 Mining Area
Expansion Project (0.06Mtpa)
Chifeng Environmental
Investment Ltd. May, 2020
Chifeng City Ecology
and Environmental
Bureau
October 12,
2020
Chifeng Huatai Mining Ltd.
Lianhuashan No.5 Mining Area
Expansion Project (0.06Mtpa)
Chifeng Environmental
Investment Ltd. July, 2020
Chifeng City Ecology
and Environmental
Bureau
September
4, 2020
Chifeng Huatai Mining Ltd.
Lianhuashan No.3 and No.7
Orebody Mining Project
(0.06Mtpa)
Chifeng Environmental
Investment Ltd.
Chifeng City Ecology
and Environmental
Bureau
October 12,
2020
Chifeng Huatai Mining Ltd.
Pengjiagou Gold Mine Project
(0.03Mtpa)
Chifeng City
Environmental
Science Institute
October,
2014
Chifeng City
Environmental
Protection Bureau
December 1,
2014
Chifeng Huatai Mining Ltd.
Lianhuashan No.26 Orebody
Mining Project (0.03Mtpa)
Chifeng City
Environmental
Science Institute
February,
2015
Chifeng City
Environmental
Protection Bureau
March 24,
2015
– IIIA-317 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Environmental Studies, Permitting, and Social or Community Impact  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 256
Project Produced By Production
date  Approved By Approval
date
Chifeng Huatai Mining Ltd.
Honghuago No.86 Ore Body
Mining Project (0.03Mtpa)
Chifeng City
Environmental
Science Institute
October,
2014
Chifeng City
Environmental
Protection Bureau
December 1,
2014
13.3.3 Wulong Project
Table 13-3: Details of the EIA Reports and Approvals for the Wulong Project
Project Produced By Production
date  Approved By Approval
date
Liaoning Wulong Gold Mine
Development Project (0.15Mtpa)
Dandong City Environmental
Protection Science Institute
October,
2006
Dandong City
Environmental
Protection Bureau
November
6, 2006
Liaoning Wulong Zhoujiagou TSF
Treatment and Processing Plant
(800 tpd) Decommissioning
Project
China Coal Technology &
Engineering Group
Shenyang Design &
Research Institute Ltd.
December,
2013
Dandong City
Environmental
Protection Bureau
April 8,
2014
13.3.4 Hanfeng Project
Table 13-4: Details of the EIA Reports and Approvals for the Hanfeng Project
Project Produced By Production
date  Approved By Approval
date
Longjing Hanfeng Mining Ltd.
Tianbaoshan Mine Area Residual
Resources Recovery and
Utilization Project
Yanbian Environmental
Protection Science
Institute
March, 2005
Yanbian
Environmental
Protection Bureau
March 14,
2005
Lishan-xinxing Mine Area Lead-
Zinc Mining Expansion Project
(0.18Mtpa)
Jilin Metallurgical
Research Institute
Jilin Linchang
Environmental
Technology Service Ltd.
May, 2013
Jilin Province
Environmental
Protection Bureau
June 9,
2013
Jilin Hanfeng Lishan Processing
Plant Technical Transformation
Project
Jilin Northeast Coal
Industry Environmental
Protection Research Ltd.
February,
2017
Yanbian
Environmental
Protection Bureau
February
20, 2017
Jilin Hanfeng Lishan Mining Area
Expansion Project (0.6Mtpa)
Jilin Linchang
Environmental Service
Ltd.

Jilin Province Ecology
and Environmental
Bureau
August 31,
2021
13.3.5 Jintai Project
Table 13-5: Details of the EIA Reports and Approvals for the Jintai Project
Project Produced By Production
date  Approved By Approval
date
Xidengping Gold Mine
Mining, Processing and
Tailings Project
(0.14Mtpa)
Kunming Nonferrous
Metallurgy Design &
Research Institute Ltd..
December
2013
Yunnan Province
Environmental
Protection Bureau
February 17,
2014
– IIIA-318 –
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SRK noted that the EIA reports for the Liaoning Wulong Gold Mine Development Project (0.15Mtpa)
and Liaoning Wulong Zhoujiagou TSF Treatment and Processing Plant (800 tpd) Decommissioning
Project did not include the new processing plant. However, Wulong Mining stated that the EIA report
had been submitted to the environmental protection bureau and was under review. Yunnan Rongtan
Environmental Protection Technology Co., Ltd. prepared a report  on the optimization and
demonstration of environmental protection measures for the proj ect in May 2022. The report
concluded that the changes resulting from the continuation of the project do not constitute significant
changes and do not alter the environmental impact assessment co nclusions already approved for
the project.
13.4 Status of Environmental Licenses and Permits
According to the requirements of relevant laws and regulations of China, a series of environmental
protection related licenses and permits should be obtained duri ng the operation of mines, such as
safety production permit, water use permit and site discharge permit.
13.4.1 Safety Production Permit
The safety production permits for each project are presented in the following tables.
Table 13-6: Details of Safety Production Permits of Jilong Project
Project Jilong Project
Safety Production Permit No. [2024] 002320
Issued To Chifeng Jilong Mining Ltd.
Issued By Inner Mongolia Autonomous Region Mine Safety Supervision Bureau
Licensed Activity Gold and Silver Mine Underground Mining, TSF Operation
Issue Date 2 July, 2024
Expiry Date 1 July, 2027
Project Jilong Project
Safety Production Permit No. [2022] 006589
Issued To Chifeng Jilong Mining Ltd. Zhuanshanzi Gold Mine #1 Mining Section Technical
Transformation Project
Issued By Chifeng City Emergency Management Bureau
Licensed Activity Gold and Silver Mine Underground Mining
Issue Date 13 January, 2025
Expiry Date 12 January, 2028
Project Jilong Project
Safety Production Permit No. [2021] 005704
Issued To Chifeng Jilong Mining Ltd. #3 Mining Section
Issued By Chifeng City Emergency Management Bureau
Licensed Activity Gold and Silver Mine Underground Mining
Issue Date 30 December, 2024
Expiry Date 29 December, 2027
Project Jilong Project
Safety Production Permit No. [2024] 005701
Issued To Chifeng Jilong Mining Ltd. #2 Mining Section
Issued By Inner Mongolia Autonomous Region Mine Safety Supervision Bureau
Licensed Activity Gold and Silver Mine Underground Mining
Issue Date 11 May, 2024
Expiry Date 10 May, 2027
Project Jilong Project
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Safety Production Permit No. [2024] 005703
Issued To Chifeng Jilong Mining Ltd. Gold Processing Plant TSF
Issued By Inner Mongolia Autonomous Region Mine Safety Supervision Bureau
Licensed Activity TSF Operation
Issue Date 11 May, 2024
Expiry Date 10 May, 2027
The #3 Mining Section of Jilong Mining is currently undergoing technical renovation, which is
scheduled to be completed by November 27, 2024. Afterward, Jilong Mining will apply for inspection
and acceptance, followed by an application for a new safety production permit.
Table 13-7: Details of Safety Production Permits of Huatai Project
Project Huatai Project
Safety Production Permit No. [2021] 001595
Issued To Chifeng Huatai Mining Ltd.
Issued By Chifeng City Emergency Management Bureau
Licensed Activity Gold Mine Underground Mining, TSF Operation
Issue Date 12 December, 2021
Expiry Date 11 December, 2024
Project Huatai Project
Safety Production Permit No. [2021] 001602
Issued To Chifeng Huatai Mining Ltd. TSF
Issued By Chifeng City Emergency Management Bureau
Licensed Activity TSF Operation
Issue Date 24 September, 2021
Expiry Date 23 September, 2024
The safety production permit for Huatai Mining's TSF has been s ubmitted to the relevant authority
for extension. The safety production acceptance for other production units have not yet commenced,
and there are currently no safety production permits.
Table 13-8: Details of Safety Production Permits of Wulong Project
Project Wulong Project
Safety Production Permit No. [2024] F0061
Issued To Liaoning Wulong Gold Mining Ltd.
Issued By Liaoning Province Local Mine Safety Supervision Bureau
Licensed Activity Gold Mine Underground Mining
Issue Date 8 June, 2024
Expiry Date 7 June, 2027
Project Wulong Project
Safety Production Permit No. [2023] F0018
Issued To Liaoning Wulong Gold Mining Ltd. Zhoujiagou TSF
Issued By Liaoning Province Emergency Management Bureau
Licensed Activity TSF Operation
Issue Date 29 October, 2023
Expiry Date 28 October, 2026
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Project Wulong Project
Safety Production Permit No. [2024] F0060
Issued To Liaoning Wulong Gold Mining Ltd. #2 Mining Section
Issued By Liaoning Province Local Mine Safety Supervision Bureau
Licensed Activity Gold Mine Underground Mining
Issue Date 3 June, 2024
Expiry Date 2 June, 2027
Project Wulong Project
Safety Production Permit No. [2023] F0032
Issued To Liaoning Wulong Gold Mining Ltd. #3 Mining Section
Issued By Liaoning Province Emergency Management Bureau
Licensed Activity Metal Underground Mining
Issue Date 5 December, 2023
Expiry Date 4 December, 2026
Project Wulong Project
Safety Production Permit No. [2023] F0022
Issued To Liaoning Wulong Gold Mining Ltd. #4 Mining Section
Issued By Liaoning Province Emergency Management Bureau
Licensed Activity Gold Mine Underground Mining
Issue Date 7 October, 2023
Expiry Date 6 October, 2026
Table 13-9: Details of Safety Production Permits of Hanfeng Project
Project Hanfeng Project
Safety Production Permit
No. [2024] ZBB0006
Issued To Jilin Hanfeng Mining Technology Ltd.
Issued By Jilin Province Emergency Management Bureau
Licensed Activity Non-coal Mining
Issue Date 24 July, 2024
Expiry Date 10 August, 2026
Project Hanfeng Project
Safety Production Permit
No. [2024] DXYBYBB0058
Issued To Jilin Hanfeng Mining Technology Ltd. Lishan Mine
Issued By Jilin Province Emergency Management Bureau
Licensed Activity Non-coal Mining
Issue Date 26 February, 2024
Expiry Date 15 May, 2025
Project Hanfeng Project
Safety Production Permit
No. [2024] DXBYBB0071
Issued To Jilin Hanfeng Mining Technology Ltd. Lishan Mine Tianbaoshan Lead-Zinc Mine Area
Dongfeng Mine
Issued By Jilin Province Emergency Management Bureau
Licensed Activity Non-coal Mining
Issue Date 26 February, 2024
Expiry Date 15 January, 2025
Project Hanfeng Project
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Safety Production Permit
No. [2023] WKBYYB0010
Issued To Jilin Hanfeng Mining Technology Ltd. Lishan TSF
Issued By Jilin Province Emergency Management Bureau
Licensed Activity TSF Operation
Issue Date 11 May, 2023
Expiry Date 9 March, 2026
Project Hanfeng Project
Safety Production Permit
No. [2023] WKBYYB0006
Issued To Jilin Hanfeng Mining Technology Ltd. Tianbaoshan Lead-Zinc Mine Area Dongfeng TSF
Issued By Jilin Province Emergency Management Bureau
Licensed Activity TSF Operation
Issue Date 11 May, 2023
Expiry Date 6 March, 2026
Table 13-10: Details of Safety Production Permits of Jintai Project
Project Jintai Project
Safety Production Permit No. [2024] 0003
Issued To Eryuan Jintai Mining Development Co., Ltd. Xidengping Gold Mine
Issued By Dali Bai Autonomous Prefecture Emergency Management Bureau
Licensed Activity Gold Mine Open Pit Mining
Issue Date 3 June, 2024
Expiry Date 2 June, 2027
13.4.2 Water Use Permit
The water use permits for the Project are presented in the following tables.
Table 13-11: Details of Water Use Permits of Jilong Project
Project Jilong Project
Water Use Permit No. D150430G2021-0058
Issued To Chifeng Jilong Mining Ltd.
Issued By Aohan Qi Water Bureau
Issue Date 15 January, 2023
Expiry Date 14 January, 2028
Water Supply Source Groundwater
Water Use Allocation 139,800m3/year
Project Jilong Project
Water Use Permit No. D150430G2023-0003
Issued To Chifeng Jilong Mining Ltd.
Issued By Aohan Qi Water Bureau
Issue Date 3 July, 2023
Expiry Date 2 July, 2028
Water Supply Source Groundwater
Water Use Allocation 78,000m3/year
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Table 13-12: Details of Water Use Permits of Huatai Project
Project Huatai Project
Water Use Permit No. D150404G2021-0044
Issued To Chifeng Huatai Mining Ltd.
Issued By Chifeng City Songshan District Water Bureau
Issue Date 11 January, 2022
Expiry Date 11 January, 2027
Water Supply Source Groundwater
Water Use Allocation 133,700m3/year
Table 13-13: Details of Water Use Permits of Wulong Project
Project Wulong Project
Water Use Permit No. 201400076680
Issued To Liaoning Wulong Gold Mining Ltd.
Issued By Agriculture and Rural Bureau of Zhen 'an District, Dandong City
Issue Date 27 May, 2020
Expiry Date 27 May, 2025
Water Supply Source Groundwater
Water Use Allocation 200,000m3/year
Table 13-14: Details of Water Use Permits of Hanfeng Project
Project Hanfeng Project
Water Use Permit No. D222405G2022-0014
Issued To Jilin Hanfeng Mining Technology Ltd.
Issued By Longjing City Water Bureau
Issue Date 1 October, 2022
Expiry Date 30 September, 2027
Water Supply Source Groundwater and surface water
Water Use Allocation 403,000m3/year
Table 13-15: Details of Water Use Permits of Jintai Project
Project Jintai Project
Water Use Permit No. D532930S2024-0028
Issued To Eryuan Jintai Mineral Development Ltd.
Issued By Eryuan County Water Bureau
Issue Date 15 May, 2024
Expiry Date 15 May, 2029
Water Supply Source Surface water
Water Use Allocation 92,400m3/year
13.4.3 Site Discharge Permit
The status of site discharge permit/registration for the Project are summarized as follows:
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 Jilong Project has registered the discharge of fixed pollution sources on July 10, 2020. The
registration number is 91150430779492220K002X. Registration is valid until July 9, 2025.
 Huatai Project has registered the discharge of fixed pollution sources on January 6, 2021. The
registration number is 9115040476767883814P002Z. Registration is valid until January 5, 2026.
 Wulong Project has registered the discharge of fixed pollution sources on March 10, 2020. The
registration number is 91210600673786837T001W. Registration is valid until March 9, 2025.
 Hanfeng Project has registered the discharge of fixed pollution sources on August 22, 2023. The
registration number is 91222405764593512F001X. Registration is valid until September 24,
2028.
 Jintai Project has registered t he discharge of fixed pollution sources on October 20, 2023. The
registration number is 915329306708718763001Z. Registration is valid until October 19, 2028.
13.5 Environmental Study and Management
This chapter summarizes the conclusions of EIA studies, the sta tus of environmental management
observed during site visits and the recommendations made by SRK.
13.5.1 Jilong Project
According to the EIA report, the vegetation in the project area belongs to the arid grassland
vegetation area. Due to years of reclamation, a large area of natural vegetation has been destroyed.
Much of the surrounding land has been reclaimed for farming. No  rare plants under state or local
protection have been found around the project. The project area  is heavily affected by human
activities and large wild animals have disappeared. Small wildl ife is limited to small rodents and
reptiles. No wild animals and birds under state protection were found in the project area.
The domestic water source for the project comes from two wells located 2.1 kilometers away. The
well also replenishes the processing plant with fresh water. Mi ne water is sedimented underground
and discharged into the upper sump and reused in the processing  plant. The EIA believes that the
project’s water abstraction will not have a great impact on the  production and domestic water
consumption of local villagers and other water users. Chifeng J ilong reported to SRK that the
groundwater quality is regularly monitored. SRK has sighted an environmental monitoring report
which was produced in April, 2024. Water samples from water monitoring well and mine dewatering
outlet were collected in March 2024. The water monitoring resul ts are all within the limits of the
relevant environmental standards. SRK recommends the company im prove an effective drainage
system to divert run-off from undisturbed areas around disturbed areas.
During the site visit, SRK noticed that there are waste rock dumps in each mining area of the project.
No geochemical characterization of waste rocks or acid rock drainage (“ARD”) assessment has been
sighted as part of this review. At present, the tailings of the  project are dry discharged into the TSF
after being treated in the filter press workshop. The accident and collection ponds were built at the
foot of the tailings dam. Two tailings samples from the project , which were wet and dry tailings
separately, were collected and tested in December, 2022. The test results show that cyanide in the
tailings meet the requirements of technical specification for p ollution control of cyanide leaching
residue in gold industry (less than 5 mg/L). During the time of SRK’s site visit, SRK did not observed
any evidence of leaching or ARD impacts. A new TSF and a new fi lter press workshop are under
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construction which is located to the northeast of the processin g plant. The EIA approval for the
Zhuanshanzi Gold Mine Processing Expansion Project states all p roduction wastewater should be
reused.
The dust emissions sources for the project are mainly from dril ling, explosion, ore crushing and
screening, tailings storage facility, waste rock dump, open are as and movement of vehicles and
mobile equipment. SRK sighted that dust removers were installed  in the processing plant. SRK did
not note the obvious dust emission in the open area of the project during the time of this site visit.
The hazardous materials generated by the project mainly consists of hydrocarbons (i.e. waste oils),
processing reagents, chemical and oil containers, explosives, e tc. SRK noted during the site visit
that storage of sodium cyanide was generally safe. Chifeng Jilo ng stated that vehicle fuel and
machinery maintenance are all outsourced. The project has a mai n explosives magazine and four
sub-magazines. During the site visit SRK inspected the main exp losive magazine, and it is SRK’s
opinion that it is a secure facility that is designed and managed in accordance with relevant Chinese
National requirements. SRK recommends that the collected waste oil and dangerous chemical be
stored with secondary containment which is in line with the rec ognised international industry
management practices.
13.5.2 Huatai Project
The EIA report states that there are no sensitive targets such as nature reserves within 10 km of the
project area. There are no rare,  endangered and protected plant  species within the scope of the
project. Animal resources withi n the scope of the project are s carce, mainly small rodents, reptiles
and common birds, and there are no rare and endangered animals.  After the implementation of
management measures, there is little impact on the vegetation and animals in the project area.
The domestic water and fresh water for the processing plant will be supplied from underground wells.
The mine water is generally collected by water tank and reused for underground production. The
processing wastewater is fully recycled and the tailings filter wastewater is reused for processing as
well. The residents in the town near the project use centralized water supply. The EIA of the project
concluded that the groundwater extraction would not have a significant impact on local groundwater
resources. In addition, the EIA opines the project has a slight  impact on surface water and
groundwater after taking measures such as wastewater reuse and TSF seepage prevention. The
company provided a groundwater quality monitoring report for th e mining area in May 2022.
Manganese, iron, arsenic, mercury, cadmium and lead in the samp les did not exceed the
requirements of the third class of groundwater quality standard s. SRK recommends the company
improve an effective drainage s ystem to divert run-off from und isturbed areas around disturbed
areas.
At present, waste rock from the project is mainly used for unde rground backfilling or sold for road
building. During this site visit, SRK noticed that there are past-generated waste dumps at the portal
of shafts in each mining area. No geochemical characterization of waste rocks or acid rock drainage
(“ARD”) assessment has been sighted as part of this review. However, the EIA considers the waste
rock generated by the project to be General Industrial Solid Waste Class I. At present, the tailings of
the project are dry discharged into the TSF after being treated  in the filter press workshop. During
the time of SRK’s site visit, SRK did not observed any evidence of leaching or ARD impacts.
– IIIA-325 –
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The dust emissions sources for the project are mainly from dril ling, explosion, ore crushing and
screening, tailings storage facility, waste rock dump, open are as and movement of vehicles and
mobile equipment. The EIA concluded that the dust generated by the project had little impact on the
surrounding environment after appropriate management measures w ere taken. SRK sighted that
dust removers were installed in the processing plant. SRK did n ot see significant dust generation
during this site visit.
The hazardous materials generated by the project mainly consists of hydrocarbons (i.e. waste oils),
processing reagents, chemical and oil containers, explosives, e tc. SRK noted during the site visit
that storage of sodium cyanide wa s generally safe. There is no gas and diesel storage on site.
Chifeng Huatai reported that the waste oil produced by the project is stored in a separate warehouse.
During the site visit SRK inspected this explosive magazine, and it is SRK’s opinion that it is a secure
facility that is designed and managed in accordance with releva nt Chinese National requirements.
SRK recommends that the collected waste oil and dangerous chemi cal be stored with secondary
containment which is in line with the recognised international industry management practices.
13.5.3 Wulong Project
The project area is well covered with vegetation. Wild animals in this area mainly include hares,
squirrels, pheasants and so on. The EIA report states that there were no rare or endangered plants
and animals in the project area. The impact of the project on the level of plant population, community
and ecosystem was not significant. After greening, the vegetation in the project area will be gradually
restored, which will make up for the loss of plant species diversity.
The main river in the project area is the Banshi River, which is a seasonal river. The river eventually
drains into Tiejia Reservoir. The project has a water treatment  plant to treat fluoride in the mine
dewatering water. The treated mine dewatering water is reused for production and heating, and the
excess water is discharged into the Banshi River. The processing wastewater is fully recycled. SRK
noted that the project's TSF is approximately 7 km from the dow nstream reservoir. Therefore, it
should be ensured that the operation of the project will not af fect the Banshi River and Tiejia
Reservoir. Liaoning Wulong stated that the Environmental Protec tion Bureau conducted surface
water and groundwater monitoring for the project. However, no w ater monitoring report has been
sighted as part of this review. SRK recommends that quality mon itoring be undertaken of the
groundwater and surface water resources within the project area  (including upstream and
downstream of the project area), and also any site water discharges.
During this site visit, SRK noticed that the waste rocks were t emporarily dumped at the portal of
shafts in each mining area. Liaoning Wulong stated that the was te rock from the project is mainly
used for underground backfilling or sold for construction. No g eochemical characterization of waste
rocks or acid rock drainage (“ARD”) assessment has been sighted as part of this review. At present,
the tailings of the project are dr y discharged into the TSF aft er being treated in the filter press
workshop. The accident and leakage collection ponds were built at the foot of the tailings dam. During
the time of SRK’s site visit, SRK did not observed any evidence of leaching or ARD impacts.
The dust emissions sources for the project are mainly from dril ling, explosion, ore crushing and
screening, tailings storage facility, waste rock dump, open are as and movement of vehicles and
mobile equipment. The project’s EIA report concluded that the o peration of the project would have
no significant impact on the ambient air. SRK did not see significant dust generation during this site
visit.
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The hazardous materials generated by the project mainly consists of hydrocarbons (i.e. waste oils),
processing reagents, chemical and oil containers, explosives, etc. There is no gas and diesel storage
on site. During the site visit SRK inspected this explosive magazine, and it is SRK’s opinion that it is
a secure facility that is designed and managed in accordance wi th relevant Chinese National
requirements. SRK recommends that the collected waste oil and dangerous chemical be stored with
secondary containment which is in line with the recognised inte rnational industry management
practices.
13.5.4 Hanfeng Project
The forest vegetation in the project area belongs to the typica l flora of Changbai Mountain and has
been replaced by natural secondary forest and artificial forest after long-term human activities. Due
to the influence of human activities, the wildlife resources in  the surveyed area have been sharply
reduced. No endangered or protected plants and animals in the p roject area were reported in the
EIAs. The EIA report opines in general the construction of the project will not change the ecological
structure and the characteristics of biodiversity.
Surface water bodies near the project include the Baoshan River and the Burhaton River. According
to the EIA, there is no hydraulic connection between the local water source well and the groundwater
of the mining area, and the project production has no influence on the drinking water of its residents.
SRK suggests that the company establish an emergency water supp ly plan to address issues such
as changes in groundwater levels. If the development affects th e water usage of surrounding
communities, alternative water sources can be provided. The min e dewatering water of the project
are collected and reused for mining and processing. Jilin Hanfe ng stated that all processing
wastewater and mine dewatering water of the project are reused and shall not be discharged. SRK
recommends the company construct an effective drainage system to divert run-off from undisturbed
areas around disturbed areas. In  addition, some prevention meas ures, such as surface hardening,
ground seepage control and second containment facility, are rec ommended to mitigate the water
pollution risks.
During this site visit, SRK noticed that the waste rocks from t he project were temporarily dumped
near the portal of shaft in the mining area and processing plan t. Jilin Hanfeng stated that the waste
rock is mainly used for underground backfilling. SRK has sighted some former waste rock dumps on
site and one of them has been rehabilitated. No geochemical characterization of waste rocks or acid
rock drainage (“ARD”) assessment has been sighted as part of th is review. However, the EIA
concluded that the waste rock from the project was not classifi ed as hazardous waste. At present,
the tailings of the project are discharged into the TSF. During  the time of SRK’s site visit, SRK did
not observed any evidence of leaching or ARD impacts.
The dust emissions sources for the project are mainly from dril ling, explosion, ore crushing and
screening, tailings storage facility, waste rock dump, open are as and movement of vehicles and
mobile equipment. SRK sighted that dust removers were only installed in the Lishan processing plant.
SRK has sighted minor dust generation in the TSF during this site visit.
The hazardous materials generated by the project mainly consists of hydrocarbons (i.e. waste oils),
processing reagents, chemical and oil containers, explosives, e tc. There is a semi-underground
diesel tank on site, and the ground has been hardened. A hazardous waste storage workshop is also
set up on site to store waste oil. During the site visit SRK in spected this explosive magazine, and it
is SRK’s opinion that it is a secure facility that is designed and managed in accordance with relevant
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Chinese National requirements. SRK recommends that the collecte d waste oil and dangerous
chemical be stored with secondary containment which is in line with the recognised international
industry management practices.
13.5.5 Jintai Project
Due to the restriction of geological and soil conditions, as well as the frequent human activities around
the area, the native vegetation no longer exists in the project area. The main vegetation types in the
area are shrub grass and secondary vegetation. The forest coverage rate of the district is about 30%,
and the trees are mainly Yunnan pine and blue eucalyptus. In ad dition, a small amount of sloping
farmland is distributed around the project area, and the main c rops are corn, beans and flue-cured
tobacco. During the EIA survey, gold buckwheat (Fagopyrumdibotr ys), which is National second-
class protected plants, was found near the mining area (outside the mine site boundary). No old and
famous trees were found within the EIA survey area. Four species of national second-class protected
wild animals were found to in the project’s survey area, which consist of pine sparrowhawk (Accipiter
virgatus), common buzzard (Buteo buteo), kestrel (Falco tinnunculus) and leopard cat (Prionailurus
bengalensis). The EIA concluded that with better management, th e operation of the project would
not have a significant impact on the diversity and distribution  pattern of vegetation in this area and
would have a lesser impact on wildlife.
Surface water bodies near the project include the Heihui River and the Liantie River. The Heihui
River flows by the west of the mine site. The Liantie River is a tributary of the Heihui River, which
flows from east to west into the Heihui River and is located to the south outside the mine area. The
project's domestic water sources are drawn from the same spring s as the local population. The
project's supplementary water source for production comes from the Heihui River, which is also used
for irrigation of the local villagers' farmland. The EIA predic ted that the mining would not affect the
drinking water sources of the surrounding villages. SRK recomme nds that it would be good for the
company to develop an emergency response plan for water supply to cope with problems which may
be caused by changes in groundwater table and pollution acciden t. The settling ponds are
recommended to collect and dispose the leaching water from waste rock dump and mine water from
open pit. All production wastewater from the heap leaching proc ess will be reused and not
discharged, and the heap leaching production facilities are designed and to be constructed with anti-
seepage measures. SRK noted the exceedance of arsenic levels in  soil at the mine site during the
environmental baseline study. The EIA report opines that this is related to the co-occurrence of
arsenic in the gold ore formation process and that the project is located in an area where the
background value of arsenic is high. In August 2022, the 209th Geological Team of Yunnan Nuclear
Industry conducted a report on the current status of major heav y metals in the soil and the
background survey of the surrounding areas of the Xidengping Go ld Mine in Eryuan County. The
report concluded that the current background values of arsenic in the soil both within and around the
mining area exceed the Category II screening value (60 mg/kg) specified in the "Soil Environmental
Quality Standards for Soil Pollution Risk Management and Contro l of Construction Land (Trial)"
(GB36600-2018). The other major heavy metals did not exceed the limit values. During this site visit,
SRK observed the drainage ditch was well constructed around the leaching heap. Emergency pond
and rainwater collection pond were constructed downstream of th e leaching heap. The leach heap
was paved with HDPE membrane and bentonite to prevent seepage. SRK sighted groundwater
monitoring boreholes were utilized around the leaching heap. The company stated that qualified third
party tested groundwater samples on a quarterly basis.
– IIIA-328 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Environmental Studies, Permitting, and Social or Community Impact  Final
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The waste rock was discharged into the waste rock dumps next to  the open pit of the V1 ore body.
The EIA report states that the heap leaching residue are hazard ous waste. The project's heap
leaching residue is to be disposed of in situ and impermeable m easures will be adopted to prevent
leakage. During the site visit, SRK noted the stripped topsoil were collected and rehabilitated. No
geochemical characterization of waste rocks or acid rock draina ge (“ARD”) assessment has been
sighted as part of this review. However, the EIA concluded that the waste rock from the project was
not classified as hazardous waste. During the time of SRK’s site visit, SRK did not observed any
evidence of leaching or ARD impacts.
The dust emissions sources for the project are mainly from ore crushing, ore stockpile, waste rock
dump, open areas and movement of vehicles and mobile equipment. The project’s EIA report
concluded that the operation of the project would have a minor impact on the ambient air. During this
site visit, SRK observed that a certain amount of dust was generated when vehicles passed over the
haul road. Water sprinkling was adopted to mitigate the dust emission on site.
No explosives will be used in the operation of the project and therefore there will be no explosives
store on site. For this project, hazardous substances include m ainly leaching reagents and
hydrocarbons (i.e. waste oils). The handling, storage and transportation of hazardous materials shall
prevent leakage, overflow or other accidental discharge into so il, surface water and groundwater.
SRK suggests taking measures to mitigate the risk of pollution caused by leakage, such as surface
hardening and second containment facility to reduce spillage and avoid flowing into key areas, and
collected waste oil shall be handed over to a local specialized company for disposal. During the site
visit, SRK noted that the leaching reagents were stored in a well protected room. SRK recommends
that the leaching reagents purc hase, transportation, handling/s torage, use, equipment
decommissioning, operation safety, emergency response, training , etc. should comply with the
Chinese legal requirements and the standards of the International Cyanide Management Code.
13.6 Occupational Health and Safety
A well developed and comprehensive safety management system com prises site inductions, site
policies, safe work procedures, training, risk/hazard managemen t (including signage), use of
personal protective equipment ( “PPE”), emergency response proce ss, incident/accident reporting,
an onsite first aid/medical centre, designated safety responsibilities for site personnel, regular safety
meetings and a work permit/tagging system.
SRK has reviewed the safety management systems and emergency response plans as provided by
the Company and is of the opinion that the reports cover items that are generally in line with
recognised Chinese industry practices and Chinese safety regula tions. During this site visit, SRK
observed that safety signs were in place, safety provisions and rules were also displayed within the
work areas, guard railings were installed on all gantries, and proper personal protection equipment
was provided and was being used by the workers, such as hardhat s.  SRK thinks more PPE could
be given to workers, such as earplugs and dust masks.
SRK has sighted the statistics of work-related injury records i n the last three years for the Project.
The statistics show that there was one fatal accident which occurred for Chifeng Huatai in 2022 and
Jilin Hanfeng in 2023 respectively. On May 18, 2022, the Songshan District People's Government of
Chifeng City issued a reply regarding the closure of Huatai Mining “3.16” collapse accident, agreeing
with the findings of the accident investigation team. The direct cause of the accident was the workers’
violation of underground work reg ulations. The accident was cla ssified as a general safety liability
– IIIA-329 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Environmental Studies, Permitting, and Social or Community Impact  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 268
incident. Huatai Mining has developed the "Lianhuashan Mining A rea #5 Mining Zone Safety
Rectification Plan" in response to the accident and has implemented specific rectification measures
in accordance with the plan. According to the accident investig ation report issued by the Longjing
Municipal Government’s Accident I nvestigation Team on June 30, 2023, Jilin Hanfeng “6.4” falling
accident was classified as a general safety liability accident,  in which the worker's violation of
operational procedures led to his  own death. The report conclud ed that the on-site rescue and
response measures were appropri ate, and post-accident follow-up  was orderly. No secondary
disasters or additional incident s occurred during the emergency  response. SRK recommends the
company conduct safety record and develop incident analysis rep orts for the possible injuries in
future. The proposed reports analysed the cause of injuries and  identified measures to prevent a
recurrence, which are in line with international recognized OHS accident monitoring practice.
13.7 Site Closure Planning and Rehabilitation
The Chinese national requirements for mine closure are covered under Article 21 of the Mineral
Resources Law of People’s Republic of China (2023), the Rules f or Implementation of the Mineral
Resources Law of the People’s Republic of China, the Mine Site Geological Environment Protection
Regulations (2019), and the Land Rehabilitation Regulation (201 1) issued by the State Council. In
summary, these legislative requirements cover the need to condu ct geological environment
protection and land rehabilitation.
There is currently no overall operational closure planning proc ess in place for the Project that is in
line with the recognised international industry management prac tices. However, SRK was provided
with a number of Project’s Geological Environment Protection an d Land Reclamation Plans which
describes the proposed rehabilitation of the mine sites.
13.7.1 Chifeng Jilong
 The Geological Environment Protection and Land Reclamation Plan  for the Zhuanshanzi Gold
Mine was produced by Inner Mongolia Huadi Environmental Consulting Ltd. in March 2024. The
plan states that the total cost of static investment is RMB15,0 24,500, of which the static
investment of mine geological environment is RMB 1,233,400, and the land reclamation is RMB
13,791,100.
13.7.2 Chifeng Huatai
 The Geological Environment Protection and Land Reclamation Plan  for the Honghuagou #1
Mining Section was produced by China Building Materials Industr y Geological Survey Center
Liaoning Team in April 2022. The plan states that the investment on the geological environmental
protection is RMB21,365,400.
 The Geological Environment Protection Plan for the Lianhuashan #5 Mining Section was
produced by China Building Materials Industry Geological Survey Center Liaoning Team in June
2020. The plan states that the investment on the geological env ironmental protection is
RMB1,947,900.
 The Geological Environment Protection Plan for the Lianhuashan #3 and #7 Orebody was
produced by China Building Materials Industry Geological Survey Center Liaoning Team in April
– IIIA-330 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Environmental Studies, Permitting, and Social or Community Impact  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 269
2020. The plan states that the investment on the geological env ironmental protection is
RMB2,002,200.
 The Geological Environment Protection and Land Reclamation Plan  for the Pengjiagou Mining
Section was produced by China Building Materials Industry Geolo gical Survey Center Liaoning
Team in March 2021. The plan states that the investment on the geological environmental
protection is RMB6,433,500.
 The Geological Environment Protection and Land Reclamation Plan  for the Lianhuashan #26
Orebody was produced by Inner Mongolia No.10 Geological Mineral  Exploration and
Development Ltd. and Chifeng Guoyuan Real Estate Evaluation Ltd. in July 2014. The plan states
that the investment on the geological environmental protection is RMB1,222,100.
 The Geological Environment Protection and Land Reclamation Plan  for the Honghuagou #86
Orebody was produced by China Building Materials Industry Geological Survey Center Liaoning
Team in December 2021. The plan states that the investment on t he geological environmental
protection is RMB3,549,000.
13.7.3 Liaoning Wulong
 The Geological Environment Protection and Land Reclamation Plan  for Liaoning Wulong Gold
Mine was produced by Liaoning Nonferrous Geological Team 103 Lt d in July 2020. The plan
states that the dynamic investment on the geological environmen tal protection and land
reclamation are RMB 35,895,100 and RMB3,917,400, respectively.
13.7.4 Jilin Hanfeng
 The Geological Environment Protection and Land Reclamation Plan for the Dongfeng Mine was
produced by Changchun Xiaohua Mineral Science and Technology Ltd. in November 2016. The
plan states that the investment on the geological environmental protection and land reclamation
are RMB6,622,727.
 The Geological Environment Protection and Land Reclamation Plan  for the Lishan Mine was
produced by Changchun Xiaohua Mineral Science and Technology Lt d. in July 2021. The plan
states that the investment on the geological environmental prot ection and land reclamation are
RMB15,313,300.
13.7.5 Yunnan Jintai
 The Geological Environment Protection and Land Reclamation Plan  for the Xidengping Gold
Mine was produced by Southwest Nengkuang Construction Engineeri ng Ltd. and Yunnan
Jinrang Technology Ltd. in January 2022. The plan states that the investment on the geological
environmental protection and land reclamation are RMB1,182,200 and RMB4,942,000,
respectively.
SRK notes that the above-mentioned geological environmental protection and land reclamation plans
for the Project are generally in line with the relevant regulat ions and recognised Chinese industry
practices. According to the Chinese legal requirements, a mine geological environment treatment
and restoration fund account should be established by the mine. The company provided information
about the accounts, and SRK opines that the Project generally complied with the requirements of the
– IIIA-331 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Environmental Studies, Permitting, and Social or Community Impact  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 270
relevant regulations. In addition, during this site visit SRK observed that Chifeng Huatai and Chifeng
Jilong's TSF have both been partially conducted reclamation.
13.8 Social Aspects
13.8.1 Jilong Project
The project is located 98km to the east of Chifeng City, Inner Mongolia Autonomous Region and is
surrounded mainly by farmland and forest. The nearest settlemen t is Fumin Village, with about a
hundred households, mostly Han Chinese, with a few Mongolians.
During this site visit, Chifeng Jilong reported that there are no environmental non-compliance notices
or fines for the project. Chifeng Jilong also stated that there  are no natural reserves or significant
cultural heritage sites within or surrounding the project area; and the EIA report also does not report
any natural reserves or significant cultural heritage sites within or surrounding the project.
The EIA report for the Chifeng Jilong Mining Ltd. Gold Mine Mining and Processing Project (400 tpd)t
provided the public participation surveys for the project const ruction. The survey results showed
83.33% personal support for the project and there are no people  who are opposed to the project in
the survey. In terms of the impact on local environmental quali ty, most of the public's concerns
focused on ecological damage, accounting for 36.67% of the total number of respondents. Other EIA
reports for the Jilong Project also show that there were no obj ections during the public participation
process.
Chifeng Jilong reported that the company had done a lot of work  to maintain community relations,
including building a primary school in Aohanqi, providing free waste rock to nearby residents to build
roads, and providing free vehicles for residents to use.
13.8.2 Huatai Project
The project is located in Wangfu Town, Chifeng City, Inner Mong olia Autonomous Region and is
surrounded mainly by farmland and forest. The surrounding commu nities are predominantly Han
Chinese.
During this site visit, Chifeng Huatai reported that there are no environmental non-compliance notices
or fines for the project. Chifeng Huatai also stated that there  are no natural reserves or significant
cultural heritage sites within or surrounding the project area; and the EIA report also does not report
any natural reserves or significant cultural heritage sites within or surrounding the project.
SRK reviewed the environmental impact assessment reports provided by the company. The reports,
which include detailed results of public participation, show that the majority of the public supports the
project's operation, with no objections raised. Chifeng Huatai stated that the company has good
relations with the local community and has donated to it for COVID-19. SRK has sighted the receipt
for the above donation.
13.8.3 Wulong Project
The project is located in Zhen’an District, Dandong City, Liaoning Province and is surrounded mainly
by farmland and forest. During this site visit, SRK noted that settlements dotted the area around the
– IIIA-332 –
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Environmental Studies, Permitting, and Social or Community Impact  Final
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mine site. The surrounding communities are predominantly Han Ch inese. Liaoning Wulong stated
that the company has good relations with the local community.
Liaoning Wulong also stated that there are no natural reserves or significant cultural heritage sites
within or surrounding the project area; and the EIA report also does not report any natural reserves
or significant cultural heritage sites within or surrounding the project.
The EIA report for the Liaoning Wulong Gold Mine Development Pr oject provided the public
participation surveys for the project construction. The survey results showed 100% personal support
for the project. The respondents believed that the project had a positive effect on the local area, both
economic and social. They also suggested that it would be good if the company has regular
environmental protection measures in place to ensure that surface and groundwater are not polluted.
And air pollutants and factory boundary noise are discharged in a stable manner. In addition, due to
historical reasons, there are still some residents waiting to be relocated in the mining area.
In January 2020, the company signed a waste rock donation agree ment with Banshi Village, giving
60,000 m3 of waste rock. In addition, the company also donated RMB 5,000  to the village primary
school on Teachers' Day 2022.
13.8.4 Hanfeng Project
The project is located in Tianbaoshan Town, Longjing City, Jili n Province and is surrounded mainly
by farmland and forest. The surrounding communities are predominantly Han Chinese and Korean.
Jilin Hanfeng stated that the company has good relations with the local community.
During this site visit, Jilin Hanfeng reported that there are no environmental non-compliance notices
or fines for the project. Jilin Hanfeng also stated that there are no natural reserves or significant
cultural heritage sites within or surrounding the project area;  and the EIA reports also do not report
any natural reserves or significant cultural heritage sites within or surrounding the project.
The EIA reports for the project provided the public participation surveys for the project construction.
The survey results of EIA for the Tianbaoshan Mine Area Residua l Resources Recovery and
Utilization Project showed 89% per sonal support for the project . The local residents did raise the
impact on surface water quality and local employment as the key  concerns for the project’s
development. The survey results of EIA for the Lishan-xinxing M ine Area Lead-Zinc Mining
Expansion Project showed that the respondents have no objection to the construction of this project.
The survey results of EIA for the Lishan Processing Plant Proje ct showed most of the affected
residents in the project area are in favor of the construction of the project. No objections were raised
during the public participation for the EIA of Jilin Hanfeng Li shan Mining Area Expansion Project
(0.6Mtpa).
13.8.5 Jintai Project
The project is located 20 km to the southwest of Eryuan County, Yunnan Province and is surrounded
mainly by farmland and forest. The project is administrated by Liantie Township and the surrounding
villages are predominantly Bai and Han Chinese.
Yunnan Jintai stated that there are no natural reserves or significant cultural heritage sites within or
surrounding the project area; and the EIA reports also do not report any natural reserves or significant
cultural heritage sites within or surrounding the project. During the site visit, SRK was informed that
– IIIA-333 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Environmental Studies, Permitting, and Social or Community Impact  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 272
more than 30 cemeteries within the mine rights have been reloca ted through compensation
agreements with villagers. Yunnan Jintai stated that the forest  and land use procedures had been
completed. SRK has sighted part of land and forest use approvals/permits. However, SRK observed
some cattle from nearby villagers grazing within the mining rig ht during the site visit. Yunnan Jintai
responded that in the future fences will be installed along the boundary of the mine site to keep cattle
out.
The original EIA report for the project provided the public par ticipation surveys for the project
construction. The survey results showed 98.5% personal support for the project and 100% group
support. During the latest EIA publicity period, no opinions and suggestions from personals and
groups were received.
– IIIA-334 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
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Capital and Operating Costs    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 273
14 Capital and Operating Costs
The mines owned by the five mining companies all have a long pr oduction history. Capital
expenditures (“Capex”) for construction of the mines, ore processing plants and onsite facilities had
been invested in history. The Jilong, Huatai, Wulong, and Hanfeng Projects are underground mines,
and the Jintai Project is an open pit mine.
14.1 Jilong Project
14.1.1 Capital Expenditures
Sustaining
Sustaining capital includes capital development and all costs related to the acquisition, replacement,
or major overhaul of assets during the mine life required to sustain operations. According to the data
provided by Jilong Mining, the capital expenditures for the last three years from 2021 to 2023 are
shown in Table 14-1.
Capital expenditures encompass initial and expansion constructi on, sustaining capital, exploration,
and sunk capital, of which sunk capital represents the total of  initial and expansion construction,
exploration, and sustaining capital because SRK does not obtain  the breakdown of these three
components. To forecast sustaining capital over the LOM, SRK ha s applied an average sustaining
unit cost of approximately 324 RMB per milled ton, based on sustaining data from 2023 through 2024
Q3.
Table 14-1: Jilong Capital Expenditures from 2021 to 2024 Q3
Year Unit 2021 2022 2023 2024 Q3
Initial/Expansion Million RMB - - 88.57 36.7
Sustaining Million RMB - - 69.95 33.94
Exploration Million RMB - - - 0.71
Sunk Capital Million RMB 44.43 74.18 - -
Source: Client
Expansion
Jilong Mining has completed new preliminary design study for expansion zone (zone 5, zone 6 and
zone 7), the detailed items are in Table 14-2. The construction period is three years and is estimated
to be finished in 2026.
Table 14-2: Initial Capital Expenditures for Jilong Expansion
Item Investment (‘0000 RMB)
Mining 8,970
Water supply and drainage 300
Power supply and communication 570
– IIIA-335 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Capital and Operating Costs    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 274
Item Investment (‘0000 RMB)
Heating and ventilation 300
General plan transportation 450
Machine repairment 300
Environment 500
Other expenses 1,000
Contingency 860
Working capital 525
Total project investment 13,775
Source: Client
Jilong Mining has a deeper expansion for zone 1, zone 2, and zone 3, the detailed items are in Table
14-2. The construction period is estimated to be finished in 2025 with the investment of RMB 59 mln.
Table 14-3: Initial Capital Expenditures for Jilong Deeper Expansion
Item Investment
(‘0000 RMB)
Already
Finished
Part One: Engineering Costs 5,296
Drifts and crosscuts 3,500
Construction 500
Equipment purchase 1,200
Equipment installation 96
Part 2: Other expenses 305
land acquisition 30 YES
Engineering construction supervision fees 80
Construction management fee 30
Early entry and training fees for employees 15
Trial Production cost 20
Production tool purchase 13 YES
Office and lifestyle 12 YES
Geological exploration 30 YES
Design 25 YES
Other start-up expenses 50
Total of Parts 1 and 2 5,601
Part Three: Project Contingency 392
Total of Parts 1, 2 and 3 5,993
Construction period interest -
Working capital 460
total project investment 6,453
Source: Client
14.1.2 Historical  Operating Cost
The total operating cash costs from 2021 to 2024 Q3, which exclude depreciation, amortization, and
financial costs, are presented in Table 14-4. Table 14-5 presents the unit costs for the same period,
along with the average unit cost and the unit cost for TEM (technical economic model) input.
– IIIA-336 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Capital and Operating Costs    Final
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Table 14-4: Operating Costs from 2021 to 2024 Q3 in Jilong Project
Item Unit 2021 2022 2023 2024 Q3
Labor RMB M 58.90 63.14 61.14 64.52
Material RMB M 19.19 24.47 24.24 27.08
Electricity RMB M 11.04  10.74 10.76 13.44
Contractors RMB M - - - -
Engineering RMB M 4.46 4.19 3.65 1.90
Service RMB M 1.89 2.02 0.65 0.09
Safety RMB M 3.96 4.00 3.05 6.91
Repairment RMB M 1.42 1.67 1.69 0.25
Others RMB M 0.52 0.53 0.21 0.09
Taxes and surcharges RMB M 16.97 15.97 63.29 19.00
Selling costs RMB M 0.08 0.10 0.12 0.00
G&A costs RMB M 30.21 30.45 43.12 28.96
R&D costs RMB M 10.19  8.38 20.33 16.36
Source: Client
Table 14-5: Operating Unit Costs from 2021 to 2024 Q3 in Jilong Project
Item Unit 2021 2022 2023 2024 Q3 Average Unit Cost TEM Input
Labor RMB/t 409.93 413.40 400.67 383.86 401.40 620.09
Material RMB/t 133.56 160.23 158.89 161.11 153.93 230.90
Electricity RMB/t 76.85 70.33  70.49 79.93 74.50 79.93
Contractors RMB/t - - - - - -
Engineering RMB/t 31.02 27.45  23.93 11.30 23.01 31.02
Service RMB/t 13.14 13.21 4.25 0.52 7.52 13.21
Safety RMB/t 27.56 26.19 20.02 41.12 29.05 41.12
Repairment RMB/t 9.90 10.95  11.05 1.46 8.14 11.05
Others RMB/t 3.59 3.44 1.38 0.55 2.18 3.59
Taxes and surcharges RMB/t 118.10 104.55 414.78 113.03 186.72 1 86.72
Selling costs RMB/t 0.57 0.6 6 0.76 0.02 0.49 0.76
G&A costs RMB/t 210.25 199. 34 282.57 172.28 215.09 282.57
R&D costs RMB/t 70.89 54.89  133.24 97.33 89.55 133.24
Source: Client
1 The TEM input is higher than the average unit cost because the milled tonnage at Jilong Mine exceeds the mining tonnage
due to comprehensive utilization, which results in a lower over all unit cost. As a result, SRK adjusted the unit cost upward
to a more reasonable level.
14.1.3 Forecasted Operating Cost
The operating cost over the LOM is shown in Table 14-6.
Table 14-6: Operating Cost Forecast in Jilong Project (Million RMB)
Item 2024 Q4 2025 2026 2027 2028 2029 2030  2031 2032
Labor 54  114  112  120  68  36  34  23  8
Material 20  42  42  45  25  13  13  9  3
Electricity 7  15  14  16  9  5  4  3  1
Contractors -    -    -    -    -    -    -    -    -
Engineering 3  6  6  6  3  2  2  1  0
Service 1  2  2  3  1  1  1  0  0
Safety 4  8  7  8  4  2  2  2  1
Repairment 1  2  2  2  1  1  1  0  0
Others 0  1  1  1  0  0  0  0  0
– IIIA-337 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
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Capital and Operating Costs    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 276
Item 2024 Q4 2025 2026 2027 2028 2029 2030  2031 2032
Taxes and
surcharges 16  34  34  36  20  11  10  7  3
Selling costs 0  0  0  0  0  0  0  0  0
G&A costs 25  52  51  55  31  17  15  11  4
R&D costs 12  24  24  26  15  8  7  5  2
Source: SRK
14.2 Huatai Project
14.2.1 Capital Expenditures
Table 14-7 shows the capital expenditures from 2021 to 2024 Q3.  The Huatai Gold Mine plans to
expand its production in the near future.
Capital expenditures encompass initial and expansion constructi on, sustaining capital, exploration,
and sunk capital, of which sunk capital represents the total of  initial and expansion construction,
exploration, and sustaining capital because SRK does not obtain  the breakdown of these three
components.
Huatai Gold Mine has no production in 2023 and 2024. In forecas ting sustaining capital over the
LOM, SRK used the sustaining unit costs from 2021 and 2022. These costs were adjusted to exclude
expansion and exploration activities, resulting in an estimated  sustaining unit cost of approximately
162 RMB per milled ton.
Table 14-7: Huatai Capital Expenditures from 2021 to 2024 Q3
Year Unit 2021 2022 2023 2024 Q3
Initial/Expansion Million RMB - - - -
Sustaining Million RMB - - 8.55 8.69
Exploration Million RMB - - - -
Sunk Capital Million RMB 48.87  14.31  - -
Source: Client
Expansion
The Huatai Mine consists of six gold mines, with plans to expand production by construction for each
mine. Table 14-8 presents the total budget and timeline allocated to each project, as determined by
the respective feasibility studies. Due to the limitations of t he processing plant's capacity, SRK has
assumed that each expansion will take three years to complete, with the construction start date based
on the LOM.
Table 14-8: Huatai Future Expansion
Project Budget (‘0000 RMB) Construction Period
(Year)
Lianhuashan #5 Mining Zone 3,706 2024-2026
Honghuagou #1 Mining Zone 11,358 2026-2028
Lianhuashan #3&#7 Vein 2,113 2038-2040
Lianhuashan #26 Vein 2,237 2045-2047
– IIIA-338 –
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Capital and Operating Costs    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 277
Project Budget (‘0000 RMB) Construction Period
(Year)
Pengjiagou Mine 4,483 2047-2049
Source: Client
14.2.2 Historical  Operating Cost
The total operating cash costs from 2021 to 2024 Q3, which exclude depreciation, amortization, and
financial costs, are presented in Table 14-9. Table 14-10 presents the unit costs for the same period,
along with the average unit cost and the unit cost for TEM input.
Table 14-9: Operating Costs from 2021 to 2024 Q3 in Huatai Project
Item Unit 2021 2022 2023 2024 Q3
Labor RMB M 28.10 4.72 3.28 -
Material RMB M 2.71 1.59 0.04 -
Electricity RMB M 4.35 1.96 0.26 -
Contractors RMB M - - - -
Engineering RMB M 9.99 10.32 1.49 -
Service RMB M 0.91 0.47 0.02 -
Safety RMB M 1.34 0.30 0.03 -
Repairment RMB M 0.39 0.13 0.00 -
Others RMB M 0.01 0.00 0.01 -
Taxes and surcharges RMB M 4.42 2.90 2.51 3.78
Selling costs RMB M - - - -
G&A costs RMB M 14.42  27.54 16.62 12.46
R&D costs RMB M - - - -
Source: Client
Table 14-10: Operating Unit Costs from 2021 to 2024 Q3 in Huatai Project
Item Unit 2021 2022 2023 2024 Q3 Average Unit Cost TEM Input
Labor RMB/t 480.18 247.05 - - 455.53 576.21
Material RMB/t 46.27 83.04 - - 54.71 54.71
Electricity RMB/t 74.26 102.25 - - 82.79 74.26
Contractors RMB/t - - - - - -
Engineering RMB/t 170.75 539.68 - - 275.04 170.75
Service RMB/t 15.62 24.53 - - 17.74 24.53
Safety RMB/t 22.88 15.74 - - 21.03 22.88
Repairment RMB/t 6.60 6.64 - - 6.49 6.64
Others RMB/t 0.19 0.21 - - 0.34 0.34
Taxes and surcharges RMB/t 75.60 151.60 - - 171.75 75.60
Selling costs RMB/t - - - - - -
G&A costs RMB/t 246.40 1,440.29 - - 896.43 295.68
R&D costs RMB/t - - - - - -
Source: Client
1 TEM inputs were based on rules of thumb from a nearby underground mine and adjusted accordingly.


– IIIA-339 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1165 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Capital and Operating Costs  Final
SRK CONSULTING CHINA LTD.  28 FEBRUARY 2025  YJ/YS 278
14.2.3 Forecasted Operating Cost
The operating cost over the LOM is shown in Table 14-11.
Table 14-11: Operating Cost Forecast in Huatai Project (Million RMB)
Item 20
26
20
27
20
28
20
29
20
30
20
31
20
32
20
33
20
34
20
35
20
36
20
37
20
38
20
39
20
40
20
41
20
42
20
43
20
44
20
45
20
46
20
47
20
48
20
49
20
50
20
51
20
52
20
53
Labor 35  35  35  35  35  35  35  35  35  35  35  35  35  35  35  35  35  35  35  35  35  35  35  35  35  35  35  29
Material 3  3  3  3  3  3  3  3  3  3  3  3  3  3  3  3  3  3  3  3  3  3  3  3  3  3  3  3
Electricity 4  5  5  5  5  5  5  5  5  5  5  5  5  5  5  5  5  5  5  5  5  5  5  5  5  5  5  4
Contractors -    -    -    -    -    -    -    -    -    -    -     -    -    -    -   -    -    -    -    -    -    -   -    -    -    -    -    -
Engineering 10  10  10  10  10  10  10  10  10  10  10  10  10  10  10  10  10  10  10  10  10  10  10  10  10  10  10  9
Service 1  1  1  1  1  1  1  1  1  1  1  1  1  1  1  1  1  1  1   1  1  1  1  1  1  1  1  1
Safety 1  1  1  1  1  1  1  1  1  1  1  1  1  1  1  1  1  1  1  1  1  1  1  1  1  1  1  1
Repairment 0  0  0  0  0  0  0  0  0  0  0  0  0  0  0  0  0  0   0  0  0  0  0  0  0  0  0  0
Others 0  0  0  0  0  0  0  0  0  0  0  0  0  0  0  0  0  0  0  0  0  0  0  0  0  0  0  0
Taxes and
surcharges 5  5  5  5  5  5  5  5  5  5  5  5  5  5  5  5  5  5  5  5  5  5  5  5  5  5  5  4
Selling
costs -    -    -    -    -    -    -    -    -    -    -    -    -    -    -   -    -    -    -    -    -    -   -    -   -    -    -    -
G&A costs 18  18  18  18  18  18  18  18  18  18  18  18  18  18  18  18  18  18  18  18  18  18  18  18  18  18  18  15
R&D costs -    -    -    -    -    -    -    -    -    -    -    -    -    -    -   -    -    -    -    -    -    -   -    -   -    -    -    -
Source: SRK


– IIIA-340 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1166 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Capital and Operating Costs    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 279
14.3 Wulong Project
14.3.1 Capital Expenditures
Table 14-12 shows the capital expenditures from 2021 to 2024 Q3. Capital expenditures encompass
initial and expansion construction, sustaining capital, explora tion, and sunk capital, of which sunk
capital represents the total of initial and expansion construct ion, exploration, and sustaining capital
because SRK does not obtain the breakdown of these three compon ents. To forecast sustaining
capital over the LOM, SRK has applied an average sustaining uni t cost of approximately 511 RMB
per milled ton, based on sustaining data from 2023 through 2024 Q3.
Table 14-12: Wulong Capital Expenditures from 2021 to 2024 Q3
Year Unit 2021 2022 2023 2024 Q3
Initial/Expansion Million RMB - - 72.67 21.66
Sustaining Million RMB - - 64.62 60.82
Exploration Million RMB - - - 0.08
Sunk Capital Million RMB 304.62  211.47  -    -
Source: Client
14.3.2 Historical  Operating Cost
The total operating cash costs from 2021 to 2024 Q3, which exclude depreciation, amortization, and
financial costs, are presented in Table 14-13. Table 14-14 presents the unit costs for the same period,
along with the average unit cost and the unit cost for TEM input.
Table 14-13: Operating Costs from 2021 to 2024 Q3 in Wulong Project
Item Unit 2021 2022 2023 2024 Q3
Labor RMB M 80.15 94.88 139.89 108.02
Material RMB M 19.00 56.27 85.03 49.10
Electricity RMB M 28.12  41.87 38.39 33.15
Contractors RMB M 7.21 - - -
Engineering RMB M 8.34 - - 1.75
Service RMB M 0.96 8.18 8.16 24.27
Safety RMB M - - - -
Repairment RMB M 3.10 2.20 2.20 3.20
Others RMB M - - - -
Taxes and surcharges RMB M 12.69 20.57 31.68 30.23
Selling costs RMB M - - - -
G&A costs RMB M 21.49  44.23 28.24 14.10
R&D costs RMB M 11.12  16.21 26.81 26.27
Source: Client
Table 14-14: Operating Unit Costs from 2021 to 2024 Q3 in Wulong Project
Item Unit 2021 2022 2023 2024 Q3 Average Unit Cost TEM Input
Labor RMB/t 209.75 226.65 241.48 210.30 223.34 670.03
Material RMB/t 49.73 134.41 146.78 95.59 110.58 331.73
– IIIA-341 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1167 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Capital and Operating Costs    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 280
Item Unit 2021 2022 2023 2024 Q3 Average Unit Cost TEM Input
Electricity RMB/t 73.58 100. 02 66.27 64.53 74.74 100.02
Contractors RMB/t 18.86 - - - 3.81 18.86
Engineering RMB/t 21.81 - - 3.41 5.33 21.81
Service RMB/t 2.51 19.54 14.09 47.25 21.95 47.25
Safety RMB/t - - - - - -
Repairment RMB/t 8.10 5.24 3.79 6.24 5.64 8.10
Others RMB/t - - - - - -
Taxes and surcharges RMB/t 33.21 49.13 54.69 58.85 50.26 58.85
Selling costs RMB/t - - - - - -
G&A costs RMB/t 56.26 105.66 48.74 27.45 57.07 105.66
R&D costs RMB/t 29.09 38.73  46.29 51.14 42.46 51.14
Source: Client
Notes:
1 The TEM input is higher than the average unit cost because the milled tonnage at Wulong Mine exceeds the mining tonnage
due to comprehensive utilization, which results in a lower over all unit cost. As a result, SRK adjusted the unit cost upward
to a more reasonable level.
14.3.3 Forecasted Operating Cost
The operating cost over the LOM is shown in Table 14-15.
Table 14-15: Operating Cost Forecast in Wulong Project (Million RMB)
Item 2024 Q4 2025 2026 2027 2028 2029 2030  2031 2032 2033 2034 2035
Labor 18  66  66  66  67  72  73  68  68  44  29  22
Material 9  33  33  32  33  36  36  34  33  22  15  11
Electricity 3  10  10  10  10  11  11  10  10  7  4  3
Contractors 1  2  2  2  2  2  2  2  2  1  1  1
Engineering 1  2  2  2  2  2  2  2  2  1  1  1
Service 1  5  5  5  5  5  5  5  5  3  2  2
Safety -    -    -    -    -    -    -    -    -    -    -    -
Repairment 0  1  1  1  1  1  1  1  1  1  0  0
Others -    -    -    -    -    -    -    -    -    -    -    -
Taxes and
surcharges 2  6  6  6  6  6  6  6  6  4  3  2
Selling costs -    -    -    -    -    -    -    -    -    -    -    -
G&A costs 3  10  10  10  10  11  11  11  11  7  5  3
R&D costs 1  5  5  5  5  6  6  5  5  3  2  2
Source: SRK
14.4 Hanfeng Project
14.4.1 Capital Expenditures
Hanfeng Mining operate two mines: the Lishan Mine and the Dongfeng Mine. Only the Lower Part
(Stage 1) of the Lishan Mine was considered in Ore Reserves estimation. Currently, this Lower Part
is under construction and has no production.
The capital expenditure data of the Upper Part of the Lishan Mi ne and the Dongfeng Mine is
referenced for the economic analysis of the Lower Part of the Lishan Mine.
– IIIA-342 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1168 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Capital and Operating Costs    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 281
The Upper Part of the Lishan Mine, along with the Dongfeng Mine, remains in production. Table
14-16 shows the capital expenditures from 2021 to 2024 Q3. Capital expenditures encompass initial
and expansion construction, sustaining capital, exploration, an d sunk capital, of which sunk capital
represents the total of initial and expansion construction, exploration, and sustaining capital because
SRK does not obtain the breakdown of these three components. To forecast sustaining capital over
the LOM, SRK has applied an average sustaining unit cost of approximately 80 RMB per milled ton,
based on sustaining data from 2023 through 2024 Q3.
Table 14-16: Hanfeng (Upper Part of the Lishan Mine and the Don gfeng Mine) Capital
Expenditures from 2021 to 2024 Q3
Year Unit 2021 2022 2023 2024 Q3
Initial/Expansion Million RMB - - 31.77 65.44
Sustaining Million RMB - - 30.52 27.56
Exploration Million RMB - - - 1.00
Sunk Capital Million RMB 65.51  76.76  -    -
Source: Client
14.4.2 Historical  Operating Cost
SRK summarised the historical operating cost data from 2020 to 2022 for the Upper Part of the
Lishan Mine and the Dongfeng Mine. The total operating cash costs from 2021 to 2024 Q3, which
exclude depreciation, amortization, and financial costs, are pr esented in Table 14-17. Table 14-18
presents the unit costs for the same period, along with the ave rage unit cost and the unit cost for
TEM input.
Table 14-17: Operating Costs from 2021 to 2024 Q3 in Hanfeng Project
Item Unit 2021 2022 2023 2024 Q3
Labor RMB M 26 37 25 77
Material RMB M 18 23 12 18
Electricity RMB M 15 20 13 13
Contractors RMB M - - - 21.28
Engineering RMB M 14.32 14.06 9.22 0.02
Service RMB M 0.98 0.82 0.25 0.59
Safety RMB M 2.20 1.64 1.32 3.29
Repairment RMB M 0.60 0.40 0.29 0.18
Others RMB M 1.27 0.93 0.65 0.56
Taxes and surcharges RMB M 7.84 10.00 3.71 11.77
Selling costs RMB M 0.12 0.16 0.11 -
G&A costs RMB M 15.60  12.70 14.75 12.81
R&D costs RMB M - - - -
Source: Client
Table 14-18: Operating Unit Costs from 2021 to 2024 Q3 in Hanfeng Project
Item Unit 2021 2022 2023 2024 Q3 Average Unit Cost TEM Input
Labor RMB/t 51.69 62.90 57.61 144.02 80.02 64.02
Material RMB/t 34.72 38.94 26.85 32.78 33.78 27.02
Electricity RMB/t 28.73 32.93  30.97 23.50 29.05 23.24
Contractors RMB/t - - - 39.78 10.28 8.23
– IIIA-343 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1169 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Capital and Operating Costs    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 282
Item Unit 2021 2022 2023 2024 Q3 Average Unit Cost TEM Input
Engineering RMB/t 28.30 23.66  21.22 0.03 18.17 14.54
Service RMB/t 1.94 1.37 0.58 1.10 1.28 1.02
Safety RMB/t 4.35 2.77 3.04 6.15 4.09 3.27
Repairment RMB/t 1.18 0.68 0.66 0.34 0.71 0.57
Others RMB/t 2.51 1.57 1.50 1.05 1.65 1.32
Taxes and surcharges RMB/t 15.49 16.83 8.54 22.01 16.10 12.88
Selling costs RMB/t 0.23 0.27 0.25 - 0.19 0.15
G&A costs RMB/t 30.84 21.38  33.96 23.95 27.00 21.60
R&D costs RMB/t - - - - - -
Source: Client
1 The unit cost in the TEM input is lower than the average unit cost because the historical costs include both Lishan Mine and
Dongfeng Mine. As a result, SRK adjusted the unit cost downward to a more reasonable level.
14.4.3 Forecasted Operating Cost
The operating cost over the LOM is shown in Table 14-19.
Table 14-19: Operating Cost Forecast in Hanfeng Project (Million RMB)
Item 2024 Q4 2025 2026 2027 2028 2029 2030  2031 2032
Labor - 28 28 27 23 29 28 25 24
Material - 12 12 12 10 12 12 11 10
Electricity - 10 10 10 8 10 10 9 9
Contractors - 4 4 4 3 4 4 3 3
Engineering - 6 6 6 5 7 6 6 5
Service - 0 0 0 0 0 0 0 0
Safety - 1 1 1 1 1 1 1 1
Repairment - 0 0 0 0 0 0 0 0
Others - 1 1 1 0 1 1 1 0
Taxes and
surcharges - 6 6 5 5 6 6 5 5
Selling costs - 0 0 0 0 0 0 0 0
G&A costs - 9 9 9 8 10 9 9 8
R&D costs - - - - - - - - -
Source: SRK
14.5 Jintai Project
14.5.1 Capital Expenditures
Jintai has started operation since 2023. Table 14-20 is the historical capital expenditure. SRK used
the averaged unit cost, approximately 24 RMB/milled ton, as the forecasted sustaining unit cost for
the LOM.
Table 14-20: Jintai capital expenditure from 2021 to 2024 Q3
Year Unit 2023 2024 Q3
Initial/Expansion Million RMB 54.95 3.85
Sustaining Million RMB -    9.88
Source: Client
– IIIA-344 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1170 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Capital and Operating Costs    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 283
14.5.2 Historical  Operating Cost
The total operating cash costs from 2023 to 2024 Q3, which exclude depreciation, amortization, and
financial costs, are presented in Table 14-21. Table 14-22 presents the unit costs for the same period,
along with the average unit cost and the unit cost for TEM input.
Table 14-21: Operating Costs from 2023 to 2024 Q3 in Jintai Project
Item Unit 2023 2024 Q3
Labor RMB M 2 3
Material RMB M 2 5
Electricity RMB M 0 1
Contractors RMB M 1.04 1.08
Engineering RMB M 1.07 4.14
Service RMB M 1.50 6.39
Safety RMB M 0.62 1.65
Repairment RMB M - -
Others RMB M - -
Taxes and surcharges RMB M 1.23 0.03
Selling costs RMB M 0.04 0.11
G&A costs RMB M 4.45 6.39
R&D costs RMB M - -
Source: Client
Table 14-22: Operating Unit Costs from 2023 to 2024 Q3 in Jintai Project
Item Unit 2023 2024 Q3 Average Unit Cost TEM Input
Labor RMB/t 14.43 6.58 8.41 14.43
Material RMB/t 15.15 13.25 13.70 15.15
Electricity RMB/t 0.57 1.48 1.27 1.48
Contractors RMB/t 8.44 2.66 4.01 8.44
Engineering RMB/t 8.73 10.25 9.89 10.25
Service RMB/t 12.18 15.82 14.97 15.82
Safety RMB/t 5.00 4.08 4.30 5.00
Repairment RMB/t - - - -
Others RMB/t - - - -
Taxes and surcharges RMB/t 9.98 0.08 2.39 9.98
Selling costs RMB/t 0.36 0.27 0.29 0.36
G&A costs RMB/t 36.20  15.82 20.57 36.20
R&D costs RMB/t - - - -
Source: Client
1 TEM inputs were based on rules of thumb from a nearby underground mine and adjusted accordingly.
14.5.3 Forecasted Operating Cost
The operating cost over LOM is shown in Table 14-23.
Table 14-23: Operating Cost Forecast in Jintai Project (Million RMB)
Item 2024 Q4 2025 2026 2027 2028 2029 2030  2031 2032 2033 2034
Labor 0.48  2.02  2.02  2.03  2.02  1.98  1.98  1.91  1.95  2.0 2  1.36
Material 0.51  2.12  2.12  2.13  2.12  2.08  2.08  2.01  2.05  2.12  1.43
– IIIA-345 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1171 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Capital and Operating Costs    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 284
Item 2024 Q4 2025 2026 2027 2028 2029 2030  2031 2032 2033 2034
Electricity 0.05  0.21  0.21  0.21  0.21  0.20  0.20  0.20  0.2 0  0.21  0.14
Contractors 0.28  1.18  1.18  1.18  1.18  1.16  1.16  1.12  1.1 4  1.18  0.80
Engineering 0.34  1.44  1.43  1.44  1.43  1.40  1.41  1.36  1.3 9  1.43  0.97
Service 0.53  2.22  2.21  2.22  2.21  2.17  2.17  2.09  2.14  2 .21  1.49
Safety 0.17  0.70  0.70  0.70  0.70  0.69  0.69  0.66  0.68  0. 70  0.47
Repairment -    -    -    -    -    -    -    -    -    -    -
Others -    -    -    -    -    -    -    -    -    -    -
Taxes and
surcharges 0.33  1.40  1.40  1.40  1.40  1.37  1.37  1.32  1.35  1.40  0.9 4
Selling costs 0.01  0.05  0.05  0.05  0.05  0.05  0.05  0.05  0 .05  0.05  0.03
G&A costs 1.21  5.07  5.06  5.08  5.07  4.96  4.97  4.79  4.89  5.07  3.41
R&D costs -    -    -    -    -    -    -    -    -    -    -
Source: SRK

– IIIA-346 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1172 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Economic Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 285
15 Economic Analysis
An economic model was created to project annual cash flows and evaluate sensitivities. This
economic analysis, which evaluated on a discounted cash flow basis, is solely for the purpose of Ore
Reserve estimation.
15.1 Historical Price
Metal markets are mature, global markets with reputable smelters and refineries located throughout
the world. Figure 15-1 shows the metal price trends for gold, copper, lead and zinc over the past five
(5) years from 2019 to 2024, in US$, which were sourced from the world largest precious metals and
base metals website: www.kitco.com.
Figure 15-1: 5-Year Price Trends of Gold, Copper, Lead and Zinc
Source: World Largest Precious Metals (gold on upper left) and Base Metals (copper on upper right, lead on lower left and zinc on lower right)
Website: www.kitco.com.
15.2 Price Forecast
A gold price of US$2,050 was use d for the calculation of the cu t-off grade in the Ore Reserve
estimates for the Jilong, Huatai, Wulong and Jintai projects. A zinc price of US$2,500/t was used for
the cut-off grade in Ore Reserve estimate for the Hanfeng project.
The Gold price forecasts and Zinc price forecasts of CMF is shown in Table 15-1, which are used in
the technical and economic analysis for the Chifeng Project.
– IIIA-347 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1173 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Economic Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 286
Table 15-1: Gold and Zinc Price Forecasts
Commodity Unit 2024 2025 2026 2027 2028 2029 and after
Gold US$/oz 2,480 2,480 2 ,360 2,220 2,130 2,000
Zinc US$/t 2,750 2,650 2, 550 2,500 2,500 2,650
Source: Forecasted Prices for Gold and Zinc by CMF in the 3rd Quarter of 2024.
15.3 Jilong Project
15.3.1 Principal Assumptions
The Jilong Project contains 0.92 Mt of Ore Reserves with an ave rage grade of 8.73 g/t Au. SRK
conducted an economic analysis based on the following basic assumptions:
 The final product is gold ingot;
 LoM is 9 years within 6 mining zones;
 SRK does not consider future inflation or currency and cost fluctuations; the price and cost remain
constant over the LoM.
 Unit sustaining costs, operating costs, mining dilution, mining recovery, and processing recovery
rate are considered constants over the LoM;
Production Schedule
Table 15-2 shows the technical parameters over life of mine, and Figure 15-2 is the mining schedule.
Table 15-2: Technical Parameters for Jilong Project
Parameter Unit Value over the LoM
Ore Reserves t 919,059
Au Grade g/t 8.73
Contained Au koz 258
Processing Recovery % 97%
Gold Produced g 7,781,969
Gold Produced oz 250,196
Source: SRK
– IIIA-348 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1174 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Economic Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 287
Figure 15-2: Jilong Project Schedule

Source: SRK
Notes：
1 The line represents the average gold grade, corresponding to the right axis.
2 The column represents the mined amount, corresponding to the left axis.
Capex
Jilong Mining has completed new preliminary design study for expansion zone (zone 5, zone 6 and
zone 7) and the construction period is three years and is estim ated to be finished in 2026. Jilong
Mining also has a deeper expansion for zone 1, zone 2, and zone  3, and the construction period is
estimated to be finished in 2025.
To forecast sustaining capital over the LOM, SRK has applied an  average sustaining unit cost of
approximately 324 RMB per milled ton, based on sustaining data from 2023 through 2024 Q3.
Please see Chapter 14.1.1 for more details.
Figure 15-3: Annual Capex over the LoM

 -
 2
 4
 6
 8
 10
 12
 14
 16
 18
 -
 50,000
 100,000
 150,000
 200,000
 250,000
2024 Q4 2025 2026 2027 2028 2029 2030 2031 2032
Au Grade (g/t)
Ore (kt)
Mined_Tonnes Mined Au
 -
 20
 40
 60
 80
 100
 120
 140
 160
 180
2024 Q4 2025 2026 2027 2028 2029 2030 2031 2032
RMB M
Expansion Initial for Zone 5.6.7 Expansion Initial for Zone 1.2.3 Sustaining
– IIIA-349 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1175 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Economic Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 288
Source: SRK
Opex
SRK has summarized the TEM input cost, please see Chapter 14.1.2 for more details.
Figure 15-4: Annual Opex over the LoM

Source: SRK
Tax and Surcharges
Non-income tax, royalties and other surcharges have been consid ered in Opex. The income tax is
15%.
Depreciation
SRK uses the straight-line depreciation method as the economic analysis assumption, and the
depreciation period is 9 years.
Closure Cost
The closure cost is estimated to be RMB15,024,500 (See Chapter 13.7.1) and is assumed to be
distributed across the LoM.
15.3.2 Financial Net Present Value
The NPV is about RMB 1,308 mln at a 10% discount rate.
Table 15-3 shows the Total Cash Flow over the LoM. Figure 15-5 shows the net cash flow and Table
15-4 shows the NPV with different discount rate.
 -
 50
 100
 150
 200
 250
 300
 350
2024 Q4 2025 2026 2027 2028 2029 2030 2031 2032
RMB M
Labor Material Electricity Contractors
Engineering Service Safety Repairment
Others Taxes and surcharges Selling costs G&A costs
R&D costs
– IIIA-350 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1176 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Economic Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 289
Table 15-3: Total Cash Flow over the LoM for Jilong Project (unit: RMB mln)
Item Total Cash Flow over the LoM
Revenue 4,043
Opex 1,502
Capex 509
Tax & other fees 326
After tax cash-flow 1,706
Source: SRK
Figure 15-5:  Annual Net Cash Flow for Jilong Project (Unit: RMB mln)

Source: SRK
Table 15-4: NPV with Different Discount Rate for Jilong Project (unit: RMB mln)
Discount Rate NPV
5% 1,481
6% 1,442
7% 1,406
8% 1,372
9% 1,339
10% 1,308
11% 1,278
12% 1,250
13% 1,223
14% 1,197
15% 1,173
Source: SRK
 -
 50
 100
 150
 200
 250
 300
 350
2024 Q4 2025 2026 2027 2028 2029 2030 2031 2032
RMB M
Net Cash Flow
– IIIA-351 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1177 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Economic Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 290
15.3.3 Sensitivity Analysis
SRK conducted single factor sensitivity analysis for the Project. The gold price, Capex and Opex are
chose to run the sensitivity analysis with ±30% range. The result is shown in Table 15-5 and Figure
15-6. Price is relatively the most sensitive factor in NPV, how ever, when price is below 30%, the
Project can still be economical.
Table 15-5: Sensitivity Analysis for Jilong Project at 10% Discount Rate (unit: RMB mln)
NPV Opex Capex Price
-30% 1,632 1,425 470
-25% 1,578 1,406 610
-20% 1,524 1,386 749
-15% 1,470 1,367 889
-10% 1,416 1,347 1,029
-5% 1,362 1,328 1,168
0% 1,308 1,308 1,308
5% 1,254 1,288 1,448
10% 1,200 1,269 1,587
15% 1,146 1,249 1,727
20% 1,092 1,230 1,866
25% 1,038 1,210 2,006
30% 984 1,190 2,146
Source: SRK
Figure 15-6: Sensitivity Analysis for Jilong Project at 10% Discount Rate (unit: RMB mln)

Source: SRK
0
500
1,000
1,500
2,000
2,500
-30% -25% -20% -15% -10% -5% 0% 5% 10% 15% 20% 25% 30%
RMB M
OPEX CAPEX PRICE
– IIIA-352 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1178 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Economic Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 291
15.4 Huatai Project
15.4.1 Principal Assumptions
The Huatai Project contains 1.69 Mt of Ore Reserves with an ave rage grade of 6.2g/t Au. SRK
conducted an economic analysis based on the following basic assumptions:
 The final product is gold ingot;
 LoM is 28 years within 5 mining zones;
 SRK does not consider future inflation or currency and cost fluctuations; the price and cost remain
constant over the LoM.
 Unit sustaining costs, operating costs, mining dilution, mining recovery, and processing recovery
rate are considered constants over the LoM;
 Working capital will be fully recovered when the mine is closed.
Production Schedule
Table 15-6 shows the technical parameters over life of mine, and Figure 15-7 is the mining schedule.
Table 15-6: Technical Parameters for Huatai Project
Parameter Unit Value over the LoM
Ore Reserves t 1,693,160
Au Grade g/t 6.2
Contained Au koz 337
Processing Recovery % 93%
Gold Produced g 9,796,028
Gold Produced oz 314,949
Source: SRK
Figure 15-7: Huatai Project Schedule

Source: SRK
 -
 2.00
 4.00
 6.00
 8.00
 10.00
 12.00
 -
 10,000
 20,000
 30,000
 40,000
 50,000
 60,000
 70,000
2024 Q4
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
2051
2052
2053
Au Grade (g/t)
Ore (kt)
Mined_Tonnes Mined Au
– IIIA-353 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1179 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Economic Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 292
Notes：
1 The line represents the average gold grade, corresponding to the right axis.
2 The column represents the mined amount, corresponding to the left axis.
Capex
For expansion, SRK has assumed that each expansion will take th ree years to complete, with the
construction start date based on the LOM.
Huatai Gold Mine has no production in 2023 and 2024. In forecas ting sustaining capital over the
LOM, SRK used the sustaining unit costs from 2021 and 2022. These costs were adjusted to exclude
expansion and exploration activities, resulting in an estimated  sustaining unit cost of approximately
162 RMB per milled ton.
Please see Chapter 14.2.1 for more details.
Figure 15-8: Annual Capex over the LoM

Source: SRK
Opex
SRK has summarized the TEM input cost, please see Chapter 14.2.2 for more details.
 -
 10
 20
 30
 40
 50
 60
 70
 80
 90
 100
2024 Q4
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
2051
2052
2053
RMB M
Expansion Initial Sustaining
– IIIA-354 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1180 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Economic Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 293
Figure 15-9: Annual Opex over the LoM

Source: SRK
Tax and Surcharges
Non-income tax, royalties and other surcharges have been consid ered in Opex. The income tax is
25%.
Depreciation
SRK uses the straight-line depreciation method as the economic analysis assumption, and the
depreciation period is 10 years.
Closure Cost
The closure cost is estimated to be RMB36,520,100 (See Chapter 13.7.2) and is assumed to be
distributed across the LoM.
15.4.2 Financial Net Present Value
The NPV is about RMB 291 mln at a 10% discount rate. Table 15-7  shows the total cash flow over
LoM. Table 15-8 shows the net cash flow and Figure 15-10 shows the NPV with different discount
rate.
Table 15-7: Total Cash Flow over the LoM for Huatai Project (Unit: RMB mln)
Item Total Cash Flow over the LoM
Revenue 4,597
Opex 2,204
Capex 549
Tax & other fees 470
 -
 10
 20
 30
 40
 50
 60
 70
 80
 90
2024 Q4
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
2051
2052
2053
RMB M
Labor Material Electricity Contractors
Engineering Service Safety Repairment
Others Taxes and surcharges Selling costs G&A costs
R&D costs
– IIIA-355 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1181 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Economic Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 294
Item Total Cash Flow over the LoM
After tax cash-flow 1,374
Source: SRK
Figure 15-10: Annual Net Cash Flow for Huatai Project (Unit: RMB mln )

Source: SRK
Table 15-8: NPV with Different Discount Rate for Huatai Project (Unit: RMB mln)
Discount Rate NPV
5% 601
6% 516
7% 445
8% 385
9% 334
10% 291
11% 255
12% 223
13% 196
14% 172
15% 152
Source: SRK
15.4.3 Sensitivity Analysis
SRK conducted single factor sensitivity analysis for the Project. The gold price, Capex and Opex are
chose to run the sensitivity analysis with ±30% range.
The results, detailed in Table 15-9 and Figure 15-11, indicate that gold price is the most significant
factor affecting NPV. The Project becomes uneconomical if the price decreases by 30%.
 (60)
 (40)
 (20)
 -
 20
 40
 60
 80
 100
 120
 140
2024 Q4
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
2051
2052
2053
RMB M
Net Cash Flow
– IIIA-356 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1182 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Economic Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 295
Table 15-9: Sensitivity Analysis for Huatai Project at 10% Discount Rate (Unit: RMB mln)
NPV Opex Capex Price
-30% 459 350 -32
-25% 431 340 25
-20% 403 330 80
-15% 375 321 133
-10% 347 311 186
-5% 319 301 238
0% 291 291 291
5% 263 282 344
10% 235 272 397
15% 208 262 450
20% 179 252 502
25% 151 243 555
30% 123 233 608
Source: SRK
Figure 15-11: Sensitivity Analysis for Huatai Project at 10% Discount Rate (Unit: RMB mln)

Source: SRK
15.5 Wulong Project
15.5.1 Principal Assumptions
The Wulong Project contains 0.98 Mt of Ore Reserves with an average grade of 7.30g/t Au. SRK
conducted an economic analysis based on the following basic assumptions:
 The final product is gold ingot;
-100
0
100
200
300
400
500
600
700
-40% -30% -20% -10% 0% 10% 20% 30% 40%RMB M
OPEX CAPEX PRICE
– IIIA-357 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1183 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Economic Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 296
 LoM is 12 years within 4 mining zones;
 SRK does not consider future inflation or currency and cost fluctuations; the price and cost remain
constant over the LoM.
 Unit sustaining costs, operating costs, mining dilution, mining recovery, and processing recovery
rate are considered constants over the LoM;
 Working capital will be fully recovered when the mine is closed.
Production Schedule
Table 15-10 shows the technical parameters over life of mine, a nd Figure 15-12 is the mining
schedule.
Table 15-10: Technical Parameters for Wulong Project
Parameter Unit Value over the LoM
Ore Reserves t 984,409
Au Grade g/t 7.30
Contained Au koz 231
Processing Recovery % 91%
Gold Produced g 6,537,702
Gold Produced oz 210,192
Source: SRK
Figure 15-12: Wulong Project Schedule

Source: SRK
Capex
To forecast sustaining capital over the LOM, SRK has applied an  average sustaining unit cost of
approximately 511 RMB per milled ton, based on sustaining data from 2023 through 2024 Q3.
 -
 1
 2
 3
 4
 5
 6
 7
 8
 9
 10
 -
 20,000
 40,000
 60,000
 80,000
 100,000
 120,000
2024 Q4 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035
Au Grade (g/t)
Ore (kt)
Mined_Tonnes Mined Au
– IIIA-358 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1184 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Economic Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 297
Figure 15-13: Annual Capex over the LoM

Source: SRK
Notes：
3 The line represents the average gold grade, corresponding to the right axis.
4 The column represents the mined amount, corresponding to the left axis.
Opex
SRK has summarized the TEM input cost, please see Chapter 14.3.2 for more details.
Figure 15-14: Annual Opex over the LoM

Source: SRK
 -
 10
 20
 30
 40
 50
 60
2024
Q4
2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035
RMB M
Sustaining
 -
 20
 40
 60
 80
 100
 120
 140
 160
 180
2024
Q4
2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035
RMB M
Labor Material Electricity Contractors
Engineering Service Safety Repairment
Others Taxes and surcharges Selling costs G&A costs
R&D costs
– IIIA-359 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1185 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Economic Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 298
Tax and Surcharges
Non-income tax, royalties and other surcharges have been consid ered in Opex. The income tax is
15%.
Depreciation
SRK uses the straight-line depreciation method as the economic analysis assumption, and the
depreciation period is 10 years.
Closure Cost
The closure cost is estimated to be RMB38,812,500 (See Chapter 13.7.3) and is assumed to be
distributed across the LoM.
15.5.2 Financial Net Present Value
The NPV is about RMB 634 mln at a 10% discount rate. Table 15-11 shows the total cash flow over
LoM. Figure 15-15 shows the net cash flow and Table 15-12 shows the NPV with different discount
rate.
Table 15-11: Total Cash Flow over the LoM for Wulong Project (Unit: RMB mln)
Item Total Cash Flow over the LoM
Revenue 2,989
Opex 1,391
Capex 543
Tax & other fees 194
After tax cash-flow 861
Source: SRK
– IIIA-360 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1186 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Economic Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 299
Figure 15-15: Annual Net Cash Flow for Wulong Project (Unit: RMB mln)

Source: SRK
Table 15-12: NPV with Different Discount Rate for Wulong Project (Unit: RMB mln)
Discount Rate NPV
5% 730
6% 709
7% 688
8% 669
9% 651
10% 634
11% 618
12% 602
13% 588
14% 574
15% 561
Source: SRK
15.5.3 Sensitivity Analysis
SRK conducted single factor sensitivity analysis for the Project. The gold price, Capex and Opex are
chose to run the sensitivity analysis with ±30% range. The result is shown in Table 15-13 and Figure
15-16. Price is relatively the most sensitive factor in NPV, however, when price is below 30%, the
Project can still be economical.
Table 15-13: Sensitivity Analysis for Wulong Project at 10% Discount Rate (Unit: RMB mln)
NPV Opex Capex Price
-30% 878 729 94
 -
 20
 40
 60
 80
 100
 120
 140
 160
 180
2024
Q4
2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035
RMB M
Net Cash Flow
– IIIA-361 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1187 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Economic Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 300
NPV Opex Capex Price
-25% 837 713 185
-20% 797 697 276
-15% 756 681 366
-10% 715 666 455
-5% 675 650 544
0% 634 634 634
5% 593 618 723
10% 553 602 813
15% 512 587 902
20% 471 571 992
25% 431 555 1,081
30% 390 539 1,171
Source: SRK
Figure 15-16: Sensitivity Analysis for Wulong Project at 10% Discount Rate (Unit: RMB mln)

Source: SRK
15.6 Hanfeng Project
15.6.1 Principal Assumptions
The Hanfeng Project contains 3. 31 Mt of Ore Reserves with an av erage grade of 2.45% Zn. SRK
conducted an economic analysis based on the following basic assumptions:
 The final product is Zn concentrate;
 LoM is 8 years within 1 mining zones;
 SRK does not consider future inflation or currency and cost fluctuations; the price and cost remain
constant over the LoM.
0
200
400
600
800
1,000
1,200
1,400
-30% -25% -20% -15% -10% -5% 0% 5% 10% 15% 20% 25% 30%
RMB M
OPEX CAPEX PRICE
– IIIA-362 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1188 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Economic Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 301
 Unit sustaining costs, operating costs, mining dilution, mining recovery, and processing recovery
rate are considered constants over the LoM;
 Working capital will be fully recovered when the mine is closed.
Production Schedule
Table 15-14 shows the technical parameters over the LoM, and Figure 15-17 is the mining schedule.
Table 15-14: Technical Parameters for Hanfeng Project
Parameter Unit Value over the LoM
Ore Reserves t 3,310,358
Zn Grade % 2.45
Contained Zn kt 81
Processing Recovery % 88%
Zn Concentrate t 152,385
Source: SRK
Figure 15-17: Hanfeng Project Schedule

Source: SRK
Notes：
1 The line represents the average gold grade, corresponding to the right axis.
2 The column represents the mined amount, corresponding to the left axis.
Capex
Hanfeng Mining operate two mines: the Lishan Mine and the Dongfeng Mine. Only the Lower Part
(Stage 1) of the Lishan Mine was considered in Ore Reserves est imation. The capital expenditure
data of the Upper Part of the Lishan Mine and the Dongfeng Mine  is referenced for the economic
analysis of the Lower Part of the Lishan Mine since they are operational mines.
 -
 1
 1
 2
 2
 3
 3
 4
 -
 50,000
 100,000
 150,000
 200,000
 250,000
 300,000
 350,000
 400,000
 450,000
 500,000
2024 Q4 2025 2026 2027 2028 2029 2030 2031 2032
Au Grade (g/t)
Ore (kt)
Mined_Tonnes Mined Au
– IIIA-363 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1189 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Economic Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 302
To forecast sustaining capital over the LOM, SRK has applied an  average sustaining unit cost of
approximately 80 RMB per milled ton, based on sustaining data from 2023 through 2024 Q3.
Please see Chapter 14.4.1 for more details.
Figure 21-17: Annual Capex over the LoM

Source: SRK
Opex
SRK has summarized the TEM input cost, please see Chapter 14.4.2 for more details.
Figure 15-18: Annual Opex over the LoM

Source: SRK
 -
 10
 20
 30
 40
 50
 60
 70
 80
 90
2024 Q4 2025 2026 2027 2028 2029 2030 2031 2032
RMB M
Expansion Initial Sustaining
 -
 10
 20
 30
 40
 50
 60
 70
 80
 90
2024 Q4 2025 2026 2027 2028 2029 2030 2031 2032
RMB M
Labor Material Electricity Contractors
Engineering Service Safety Repairment
Others Taxes and surcharges Selling costs G&A costs
R&D costs
– IIIA-364 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1190 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Economic Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 303
Tax and Surcharges
Non-income tax, royalties and other surcharges have been consid ered in Opex. The income tax is
25%.
Depreciation
SRK uses the straight-line depreciation method as the economic analysis assumption, and the
depreciation period is 8 years.
Closure Cost
The closure cost is estimated to be RMB15,313,300 (See Chapter 13.7.4) and is assumed to be
distributed across the LoM.
15.6.2 Financial Net Present Value
The NPV is about RMB 39 mln at a 10% discount rate. Table 15-15 shows the total cash flow over
LoM. Figure 15-19 shows the net cash flow and Table 15-16 shows the NPV with different discount
rate.
Table 15-15: Total Cash Flow over the LoM for Hanfeng Project (Unit: RMB mln)
Item Total Cash Flow over the LOM
Revenue 1,189
Opex 589
Capex 391
Tax & other fees 85
After tax cash-flow 125
Source: SRK
– IIIA-365 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1191 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Economic Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 304
Figure 15-19: Annual Net Cash Flow for Hanfeng Project (Unit: RMB mln )

Source: SRK
Table 15-16: NPV with Different Discount Rate for Hanfeng Project (Unit: RMB mln)
Discount Rate NPV
5% 76
6% 67
7% 60
8% 53
9% 46
10% 39
11% 33
12% 28
13% 22
14% 17
15% 12
Source: SRK
15.6.3 Sensitivity Analysis
SRK conducted single factor sensitivity analysis for the Projec t. The Zn price, Capex and Opex are
chose to run the sensitivity analysis with ±30% range. The result is shown in Table 15-17 and Figure
15-20. The Project becomes uneconomical if the Price decreases by 10%, OPEX increased by 15%,
or CAPEX increased by 20%.
Table 15-17: Sensitivity Analysis for Hanfeng Project at 10% Discount Rate (Unit: RMB mln)
NPV Opex Capex Price
-30% 138 116 -162
 (100)
 (80)
 (60)
 (40)
 (20)
 -
 20
 40
 60
 80
2024 Q4 2025 2026 2027 2028 2029 2030 2031 2032
RMB M
Net Cash Flow
– IIIA-366 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1192 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Economic Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 305
NPV Opex Capex Price
-25% 122 103 -126
-20% 105 91 -91
-15% 89 78 -58
-10% 72 65 -25
-5% 56 52 7
0% 39 39 39
5% 23 26 71
10% 6 14 103
15% -10 1 135
20% -27 -12 167
25% -44 -25 198
30% -62 -38 230
Source: SRK
Figure 15-20: Sensitivity Analysis for Hanfeng Project at 10% Discount Rate (Unit: RMB mln)

Source: SRK
15.7 Jintai Project
15.7.1 Principal Assumptions
The Jintai Project contains 1.37 Mt of Ore Reserves with an ave rage grade of 0.74g/t Au. SRK
conducted an economic analysis based on the following basic assumptions:
 The final product is gold ingot;
 LoM is 11 years within 2 open pits;
 SRK does not consider future inflation or currency and cost fluctuations; the price and cost remain
constant over the LoM.
 Unit sustaining costs, operating costs, mining dilution, mining recovery, and processing recovery
rate are considered constants over the LoM;
-200
-150
-100
-50
0
50
100
150
200
250
-30% -25% -20% -15% -10% -5% 0% 5% 10% 15% 20% 25% 30%
RMB M
OPEX CAPEX PRICE
– IIIA-367 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1193 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Economic Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 306
 Unit sustaining costs, operating costs, mining dilution, mining recovery, and processing recovery
rate are considered constants over the LoM;
 Working capital will be fully recovered when the mine is closed.
Production Schedule
Table 15-18 shows the technical parameters over the LoM, and Figure 15-21 is the mining schedule.
Table 15-18: Technical Parameters for Jintai Project
Parameter Unit Value over the LoM
Ore Reserves t 1,369,639
Wast t 2,568,020
Strip Ratio t/t 1.87
Au Grade g/t 0.74
Contained Au koz 32.54
Processing Recovery % 78
Gold Produced g 795,675
Gold Produced oz 25,582
Source: SRK
Figure 15-21: Jintai Project Schedule

Source: SRK
Notes：
1 The line represents the average gold grade, corresponding to the right axis.
2 The column represents the mined amount, corresponding to the left axis.

 -
 0.20
 0.40
 0.60
 0.80
 1.00
 1.20
 1.40
 -
 200,000
 400,000
 600,000
 800,000
 1,000,000
 1,200,000
2024
Q4
2025 2026 2027 2028 2029 2030 2031 2032 2033 2034
Au Grade (g/t)
Ore (kt)
Ore Waste Mined Au
– IIIA-368 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1194 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Economic Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 307
Capex
SRK used the averaged unit cost, approximately 24 RMB/milled to n, as the forecasted sustaining
unit cost for the LOM.
Please see Chapter 14.5.1 for more details.
Figure 15-22: Annual Capex over the LoM

Source: SRK
Opex
SRK has summarized the TEM input cost, please see Chapter 14.5.2 for more details.
Figure 15-23: Annual Opex over the LoM

Source: SRK
 -
 1
 1
 2
 2
 3
 3
 4
 4
2024 Q4 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034
RMB M
Sustaining
 -
 5.00
 10.00
 15.00
 20.00
2024 Q4 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034
RMB M
Labor Material Electricity Contractors
Engineering Service Safety Repairment
Others Taxes and surcharges Selling costs G&A costs
R&D costs
– IIIA-369 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1195 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Economic Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 308
Tax and Surcharges
Non-income tax, royalties and other surcharges have been consid ered in Opex. The income tax is
15%.
Depreciation
SRK uses the straight-line depreciation method as the economic analysis assumption, and the
depreciation period is 11 years.
Closure Cost
The closure cost is estimated to be RMB6,124,200 (See Chapter 13.7.5) and is assumed to be
distributed across the LoM.
15.7.2 Financial Net Present Value
The NPV is about RMB 83 mln at a 10% discount rate. Table 15-19 shows the total cash flow over
LoM. Figure 15-24 shows the net cash flow and Table 15-20 shows the NPV with different discount
rate.
Table 15-19: Total Cash Flow over the LoM for Jintai Project (Unit: RMB mln)
Item Total Cash Flow over the LoM
Revenue 380
Opex 160
Capex 40
Tax & other fees 50
After tax cash-flow 128
Source: SRK
Figure 15-24: Annual Net Cash Flow for Jintai Project (Unit: RMB mln )

 -
 5
 10
 15
 20
 25
 30
 35
2024 Q4 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034
RMB M
Net Cash Flow
– IIIA-370 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1196 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Economic Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 309
Source: SRK
Table 15-20: NPV with Different Discount Rate for Jintai Project (Unit: RMB mln)
Discount Rate NPV
5% 101
6% 97
7% 93
8% 90
9% 86
10% 83
11% 80
12% 77
13% 75
14% 72
15% 70
Source: SRK
15.7.3 Sensitivity Analysis
SRK conducted single factor sensitivity analysis for the Projec t. The price, Capex and Opex are
chose to run the sensitivity analysis with ±30% range. The result is shown in Table 15-21 and Figure
15-25. Price is relatively the most sensitive factor in NPV, ho wever, when price is below 30%, the
Project can still be economical.
Table 15-21: Sensitivity Analysis for Jintai Project at10% Discount Rate (Unit: RMB mln)
NPV Opex Capex Price
-30% 108 89 26
-25% 104 88 35
-20% 100 87 45
-15% 95 86 55
-10% 91 85 64
-5% 87 84 74
0% 83 83 83
5% 79 82 93
10% 75 81 102
15% 71 80 112
20% 66 79 121
25% 62 78 131
30% 58 77 140
Source: SRK
– IIIA-371 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1197 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Economic Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 310
Figure 15-25: Sensitivity Analysis for Jintai Project at10% Discount Rate (Unit: RMB mln)

Source: SRK

0
20
40
60
80
100
120
140
160
-30% -25% -20% -15% -10% -5% 0% 5% 10% 15% 20% 25% 30%
RMB M
OPEX CAPEX PRICE
– IIIA-372 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1198 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Risk Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 311
16 Risk Assessment
SRK completed a risk assessment of the specific risks identifie d for the Chifeng Gold Project in
relation to their likelihood of occurrence within the LoM and c onsequence in accordance with the
Exchange to the Listing Rules.
In general, the risk of a project decreases from exploration, through development, to the production
stage.  The Chifeng Gold’s five projects are all advanced projects.
SRK considered various technical aspects which may affect the feasibility and future cash flow of the
China Project.  SRK’s final Risk Assessment is presented in Table 16-1.
Table 16-1: Risk Assessment  for Chifeng Gold Project
Risk Source/Issue Likelihood Consequence Risk
Jilong Project
Geology, Mineral Resources and Ore Reserves
Lack of Significant Mineral Resource Unlikely Moderate Low
Lack of Significant Ore Reserve Unlikely Major Medium
Significant Unexpected Geological Faulting Possible Moderate Medium
Unexpected Groundwater Ingress Unlikely Moderate Low
Mining
Significant Production Shortfalls Possible Moderate Medium
Significant Geological Structure Unlikely Moderate Low
Excessive Surface Subsidence Unlikely Moderate Low
Poor Underground Condition Possible Moderate Medium
Poor Mine Plan Possible Moderate Medium
Significantly lacking Ore Reserves Unlikely Majo r Medium
Ore Processing and smelting
Poor Plant Reliability Unlikely Moderate Low
Lower Throughput Unlikely Moderate Low
Lower Smelting Recovery Possible Moderate Medium
Environmental and Social
Water management Possible Moderate Medium
Waste Rock and Tailings Management Possible Moderate Medium
Environmental Approval Unlikely Moderate Low
Social Aspects Unlikely Moderate Low
Capital and Operating Costs
Project Timing Delay Possible Mino r Low
Capital Cost Increases Possible Moderate Medium
Capital Costs- Ongoing Possible Moderate Medium
Operating Cost Underestimated Possible Moderate Medium
Huatai Project
– IIIA-373 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


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Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Risk Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 312
Risk Source/Issue Likelihood Consequence Risk
Geology, Mineral Resources and Ore Reserves
Lack of Significant Mineral Resource Unlikely Moderate Low
Lack of Significant Ore Reserve Unlikely Major Medium
Significant Unexpected Geological Faulting Possible Moderate Medium
Unexpected Groundwater Ingress Unlikely Moderate Low
Mining
Significant Production Shortfalls Unlikely Moderate Low
Significant Geological Structure Unlikely Moderate Low
Excessive Surface Subsidence Unlikely Moderate Low
Lack of Competent Technical Personnels Possible Moderate Medium
Poor Mine Technical Management Possible Moderate Medium
Significantly lacking Ore Reserves Unlikely Majo r Medium
Ore Processing and smelting
Poor Plant Reliability Possible Moderate Medium
Lower Throughput Possible Moderate Medium
Lower Smelting Recovery Possible Moderate Medium
Environmental and Social
Water Management Unlikely Major Medium
Waste Rock and Tailings Management Possible Moderate Medium
Hazardous Materials Management Unlikely Moderate Low
Capital and Operating Costs
Project Timing Delay Likely Minor Low
Capital Cost Increases Possible Moderate Medium
Capital Costs- Ongoing Possible Moderate Medium
Operating Cost Underestimated Likely Moderate High
Wulong Project
Geology, Mineral Resources and Ore Reserves
Lack of Significant Mineral Resource Unlikely Moderate Low
Lack of Significant Ore Reserve Unlikely Major Medium
Significant Unexpected Geological Faulting Possible Moderate Medium
Unexpected Groundwater Ingress Unlikely Moderate Low
Mining
Significant Production Shortfalls Possible Moderate Medium
Significant Geological Structure Unlikely Moderate Low
Excessive Surface Subsidence Unlikely Moderate Low
Lack of Competent Technical Personnels Possible Moderate Medium
Poor Mine Technical Management Possible Moderate Medium
Significantly lacking Ore Reserves Unlikely Majo r Medium
Ore Processing
– IIIA-374 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1200 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Risk Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 313
Risk Source/Issue Likelihood Consequence Risk
Poor Plant Reliability Unlikely Moderate Low
Lower Throughput Unlikely Moderate Low
Lower Processing Recovery Possible Moderate Medium
Environmental and Social
Water Management Possible Moderate Medium
Waste Rock and Tailings Management Unlikely Moderate Low
Environmental Approval Possible Moderate Medium
Social Aspects Possible Mino r Low
Capital and Operating Costs
Project Timing Delay Unlikely Mino r Low
Capital Cost Increases Possible Moderate Medium
Capital Costs- Ongoing Possible Moderate Medium
Operating Cost Underestimated Possible Moderate Medium
Jintai Project
Geology, Mineral Resources and Ore Reserves
Lack of Significant Mineral Resource Unlikely Moderate Low
Lack of Significant Ore Reserve Unlikely Major Medium
Significant Unexpected Geological Faulting Possible Moderate Medium
Unexpected Groundwater Ingress Unlikely Moderate Low
Mining
Significant Production Shortfalls Unlikely Moderate Low
Significant Geological Structure Unlikely Moderate Low
Excessive Surface Subsidence Unlikely Moderate Low
Lack of Competent Technical Personnels Unlikely Moderate Low
Poor Mine Technical Management Unlikely Moderate Low
Significantly lacking Ore Reserves Unlikely Majo r Medium
Processing and Metallurgy
Poor Process Reliability Unlikely Moderate Low
Lower Ore Throughput Unlikely Moderate Low
Poor Permeability of Ore Heap Possible Moderate Medium
Lower Gold Recovery Possible Moderate Medium
Environmental and Social
Water Management Unlikely Major Medium
Waste Rock and Tailings Management Unlikely Moderate Low
Social Aspects Possible Moderate Medium
Capital and Operating Costs
Project Timing Delay Unlikely Minor Low
Capital Cost Increases Possible Moderate Medium
Capital Costs- Ongoing Possible Moderate Medium
– IIIA-375 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1201 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Risk Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 314
Risk Source/Issue Likelihood Consequence Risk
Operating Cost Underestimated Possible Moderate Medium
Hanfeng Project
Geology, Mineral Resources and Ore Reserves
Lack of Significant Mineral Resource Possible Majo r Low
Lack of Significant Ore Reserve Unlikely Major Medium
Significant Unexpected Geological Faulting Possible Moderate Medium
Unexpected Groundwater Ingress Unlikely Moderate Low
Mining
Significant Production Shortfalls Unlikely Moderate Low
Significant Geological Structure Unlikely Moderate Low
Excessive Surface Subsidence Unlikely Moderate Low
Lack of Competent Technical Personnels Possible Moderate Medium
Poor Mine Technical Management Possible Moderate Medium
Significantly lacking Ore Reserves Unlikely Majo r Medium
Ore Processing
Poor Plant Reliability Possible Moderate Medium
Lower Throughput Possible Moderate Medium
Lower Processing Recovery Possible Moderate Medium
Environmental and Social
Water Management Unlikely Moderate Low
Waste Rock and Tailings Management Possible Moderate Medium
Environmental Approval Unlikely Moderate Low
Capital and Operating Costs
Project Timing Delay Unlikely Minor Low
Capital Cost Increases Possible Moderate Medium
Capital Costs- Ongoing Possible Moderate Medium
Operating Cost Underestimated Possible Moderate Medium

In the risk assessment, various risk issues have been assessed for Likelihood, Consequence, and
Overall Rating.  SRK has used a matrix as described below.
The Likelihood of a risk is considered within a certain time frame, e.g., five years, as:
 Likely: will probably occur;
 Possible: may occur; or
 Unlikely: unlikely to occur.
The Consequence of a risk is classified as:
 Major: the factor poses an immediate danger to the China Project that, if uncorrected, will have
a material effect on the China Project cash flow and performance and could lead a project failure;
– IIIA-376 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1202 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Risk Assessment    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 315
 Moderate: the factor, if uncorrected, will have a significant effect on the China Project cash flow
and performance; or
 Minor: the factor, if uncorrected, will have little or no effect on t he China Project cash flow and
performance.
The overall risk assessment combines the Likelihood and Consequ ence of a risk and be classified
as Low (unlikely and possible minor risks, and unlikely moderate risk), Medium (likely minor, possible
moderate, and unlikely major risks) and High (likely moderate a nd major risks, and possible major
risks).

– IIIA-377 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1203 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Conclusions and Recommendations   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 316
17 Conclusions and Recommendations
SRK conducted a full technical review on the Chifeng Gold Project and the conclusions and
recommendations of this review have been discussed in each main section or technical discipline of
this Report.
The Projects consists of five operating projects; the Jilong, H uatai and Wulong Projects are
underground gold mines, the Jintai Project is an open pit gold mine, and the Hanfeng Project,
including the Lishan and Dongfeng mines, is an underground lead -zinc polymetallic project. The
Jintai Project just started mining operation in the first quart er of 2024, while the other four projects
including the Jilong Huatai, Wulong and Hanfeng projects have been in production for many years.
17.1 Jilong Project
There are ongoing production exploration programs at the Zhuans hanzi Mine for further Mineral
Resources. SRK recommends that Jilong mining conduct a structur ed QA/QC process for this
exploration work, including the level exploration tunnelling, i n-fill drilling, sampling, sample
preparation, analysis, internal a nd external checks, and insert ion of control samples (i.e. blank,
standard and duplicate samples). SRK recommends that Jilong mining retains coarse duplicates and
pulp duplicate samples for future examination.
SRK has conducted Mineral Resource and Ore Reserve Estimates un der the JORC Code. It is
recommended to improve the quality of the grade control model and incorporate it into
resource/reserve model.
The processing flowsheet of whole ore cyanidation and Merrill-C rowe process is suitable for the
requirements of the ore properties. The production process and equipment are reasonable, and a
satisfied gold recovery rate was obtained with no major flaws.
The capacity of the existing TSF is close to the designed capacity while a new TSF with an effective
capacity of 228.4×104m3 is currently in trial operation, which will serve the processing plants for about
14.42 years.
The access and mine design are appropriate. Also, the geotechnical structure and drainage are
acceptable during the site visit. There are PFS level studies f or each zone with detailed design of
underground service.
 The areas visited were clean, reasonably well-ventilated and dry.
 There is minimal geological support underground, verifying that  mining is progressing as per
plan, and/ or one ore. There is no regular face sampling, hence unable to reconcile the MRE with
the actual mining face grade, with ore mined/ moved grades, pro cessed grades and gold
produced.
 Reported that the mine does not have sufficient geologists. Reported limited budget for technical
support services, and it appears that they generally have limit ed skilled technical services
support.
 On surface they utilise ore/ waste sorting based on size. Mater ial is hoisted to surface and put
through a large screen with small material assumed to be ore.
– IIIA-378 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1204 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Conclusions and Recommendations   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 317
17.2 Huatai Project
There are ongoing production exploration programs for further Mineral Resources. SRK recommends
that Huatai mining conduct a structured QA/QC process for this exploration work, including the level
exploration tunnelling, in-fill drilling, sampling, sample prep aration, analysis, internal and external
checks, and insertion of control samples (i.e. blank, standard and duplicate samples). SRK
recommends that Huatai mining retains coarse duplicates and pulp duplicate samples for future
examination.
Traditional CIP technology is adopted for gold recovering. In S RK’s opinion, it is reasonable and
stable. The satisfactory technical indexes have been achieved, with no major defects.
At the time of SRK site visit, the processing plant was in a state of shutdown. Huatai Mining informed
that the reason was that the ongoi ng technical innovation and t he production capacity expansion
were underway.
SRK has conducted Mineral Resource and Ore Reserve Estimates un der the JORC Code. It is
recommended to improve the quality of grade control model and incorporate it into resource/reserve
model.
In general, mine of Huatai Project were operated at small scale  capacity for a long time. The
geotechnical and hydrogeological c onditions are not complex to deal with. Therefore, the
underground access method, stoping method, and related service systems & machinery are suitable
for the mine operations.
In order to ensure normal mining production in the future, the existing operation system and the
design needs further supplementation and improvement, which include mainly the following aspects:
 The reconciliation study is recommended in the future. The reconciliation study would help the
operation to compare the estimates against production, then imp rove the estimation getting a
higher-level confidence of resource estimates and improve mining operation outcomes.
17.3 Wulong Project
There are ongoing production exploration programs for further Mineral Resources. SRK recommends
that Wulong mining conduct a structured QA/QC process for this exploration work, including the level
exploration tunnelling, in-fill drilling, sampling, sample prep aration, analysis, internal and external
checks, and insertion of control samples (i.e. blank, standard and duplicate samples). SRK
recommends that Wulong mining retains coarse duplicates and pul p duplicate samples for future
examination.
SRK has conducted Mineral Resource and Ore Reserve Estimates un der the JORC Code. It is
recommended to improve the quality of grade control model and incorporate it into resource/reserve
model.
Wulong Project has been operating for a long period of time, and there is ongoing production
exploration for resource potential. There is no major issue for  development and the mine design.
During the site visit, SRK notes that the geotechnical structur e and drainage are acceptable. Also,
there are PFS level of studies for each zone with detailed design of underground service.
Recommendations
– IIIA-379 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1205 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
Conclusions and Recommendations   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 318
 Underground Geological sampling at Wulong Mine has continued th roughout 2024, the tunnel
sampling data was required to be provided to SRK for the resour ce model update in alignment
with the mining depletion data.
 No mining software derived plan.
 Planning 100ktpa, achieving 60ktpa from underground stopes, sup plemented by underground
and surface stockpiles, but no ore grade verification of stockpile material.
 There is minimal geological support underground, verifying that mining is progressing as per plan,
and/ or one ore. There is no regular face sampling, hence unable to reconcile the MRE with the
actual mining face grade, with ore mined/ moved grades, processed grades and gold produced.
The actual dilution rate and recovery rates appear to be inconsistent with the planned targets, as the
mining grade is significantly lower than the geological grade. It has been noted by onsite personnel
that, in the interest of comprehe nsive resource utilization, a portion of lower-grade ore has been
intentionally blended in. It is recommended that a reconciliati on study be conducted to better
understand the underlying discrepancies and to facilitate improvements in future production.
17.4  Hanfeng Project
It is recommended to carry out in-fill drilling exploration and /or underground exploration for the
Deeper parts of Lishan and Dongfeng mines.
In order to ensure normal mining production in the future, the existing operation system and the
design needs further supplementation and improvement.
17.5 Jintai Project
SRK has conducted Mineral Resource and Ore Reserve Estimates un der the JORC Code. It is
recommended to improve the quality of grade control model and incorporate it into resource/reserve
model.
SRK considers the mining and stripping methods adopted to be a mature mining technology
commonly used in open pit mining practices, and technically bot h reasonable and feasible. The
designed bench height and slope angle are considered reasonable , as well as the small-scale
excavator is suitable for selective mining. However, the truck payload (7.8t) is not commonly used in
practice. Some larger trucks (30t payload) were observed standi ng by during site visit. The loading
round would be increased then the haulage round would be reduce d. But the excavator and truck
matching each other would not be a material risk for operation, as the total volume of mining is small.
– IIIA-380 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1206 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
References    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 319
18 References
1. Gold Mine in Aohanqi, Inner Mongolia, April 2018.
2. Inner Mongolia Shengyuan Geological Exploration Co., Ltd., Exploration Report of #26 Vein in Lianhuashan
Gold Mine in Chifeng, Inner Mongolia, May 2013.
3. Inner Mongolia Shengyuan Geological Exploration Co., Ltd., Supplementary Exploration Report of #86 Vein
in Honghuagou Gold Mine in Chifeng, Inner Mongolia, January 2013.
4. Inner Mongolia Taida Geological and Mineral Exploration and Development Co., Ltd., Report on Production
and Deep Exploration of #5 Mining Area in Lia nhuashan Gold Mine in Chifeng, Inner Mongolia,  January
2019.
5. Inner Mongolia Taida Geological and Mineral Exploration and Development Co., Ltd., Report on Production
and Deep Exploration of #3 and #7 Veins in Lianhu ashan Gold Mine in Chifeng, Inner Mongolia,  August
2018.
6. Inner Mongolia Shengyuan Geological Exploration Co., Ltd., Supplementary Exploration Report of
Pengjiagou Gold Mine in Chifeng, Inner Mongolia, January 2013.
7. Liaoning No. 7 Geological Brigade Co., Ltd., Resource and Reserve Verification Report of Wulong Gold
Mine in Dandong, Liaoning Province, November 2019.
8. Jilin Provincial Institute of Geological Survey, Resource and Reserve Verification Report of Dongfeng
Molybdenum-Zinc Mining Area in Tianbaoshan Lead-Zinc Mine in Longjing, Jilin Province, June 2011.
9. Geological (General Exploration) Report of the Xidengping Gold Deposit, Eryuan County, Yunnan Province,
2009.
10. Geological (Resource Verification) Report of the Xidengping Gold Deposit, Eryuan County, Yunnan
Province, 2021.
11. Geological (Advanced Exploration)  Report of the Xidengping Gold Deposit, Eryuan County, Yunnan
Province, 2022.
12. Experimental research report of gold extraction in Xidengping Gold Deposit, Eryuan County, Eryuan Jintai
Mining Development Co., Ltd. Kunming Engineering & Research Institute of Nonferrous Metallurgy Co., Ltd.
February 2013.
13. Column leaching test report of 255kg ore sample of V1 orebody in Xidengping Gold Mine . Eryuan Jintai
Mining Development Co., Ltd. June 2021.
14. Processing test report of Xidengping gold Mine Lab oratory, Eryuan County, Yunnan Province, Yunnan
Haoyuan Mining Co., Ltd.  Yunnan Geological and Mineral Exploration and Development Bure au. June
2021.
15. Jinchan gold leaching agent test report of Eryuan Xidengping gold mine, Eryuan Jintai Mining Development
Co., Ltd.. Eryuan Jintai Mining Development Co., Ltd. April 2021.
16. (Instructions) Preliminary Design of Eryuan Jintai Mining Developm ent Co. Ltd. Fo r 140,000tpa Open Pit
Mining Project at Xidengping Gold Mine in Eryuan County . Jin Jian Engineering Design Co. Ltd. October
2022.

– IIIA-381 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1207 ---
Competent Person's Report on the Gold and Lead-Zinc Projects in the People's Republic of China
References    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  YJ/YS 320
Closure
This report, Competent Person’s Report for the Gold and Lead-Zinc Projects in the People’s Republic of China, was
prepared by

Yiefei Jia, PhD, FAusIMM (CP Geo)
Principal Consultant and Project Manager

and reviewed by

Yonglian Sun, PhD, FAusIMM
Corporate Consultant


All data used as source material plus the text, tables, figures, and attachments of this document have been reviewed and prepared
in accordance with generally accepted professional engineering and environmental practices.
– IIIA-382 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1208 ---
Section 1 Sampling Techniques and Data
(Criteria in this section apply to all succeeding sections.)
Criteria JORC Code explanation Commentary
Sampling
techniques
• Nature and quality of sampling (eg cut
channels, random chips, or specific
specialised industry standard
measurement tools appropriate to the
minerals under investigation, such as
down hole gamma sondes, or
handheld XRF instruments, etc). These
examples should not be taken as
limiting the broad meaning of sampling.
• Include reference to measures taken to
ensure sample representivity and the
appropriate calibration of any
measurement tools or systems used.
• Aspects of the determination of
mineralisation that are Material to the
Public Report.
• In cases where ‘industry standard’
work has been done this would be
relatively simple (eg ‘reverse
circulation drilling was used to obtain 1
m samples from which 3 kg was
pulverised to produce a 30 g charge for
fire assay’). In other cases more
explanation may be required, such as
where there is coarse gold that has
inherent sampling problems. Unusual
commodities or mineralisation types
(eg submarine nodules) may warrant
disclosure of detailed information.
Jilong and Huatai Projects
• Both projects use the same sampling techniques.
• Samples were taken from drill cores by splitting along
the core axis. The sample length ranges from 0.8m to
1.0m. The weight of samples was between 9.45
kilograms (“kg”) and 12.38kg.
• Samples were collected from  tunnels using a channeling
method. The sample channel was perpendicular or
roughly perpendicular to the strike of mineralised body.
The section of channel was 10cm × 5cm, and the
sample length ranges from 0.1m to 1.2m. The distance
between samples were 6m along drift, and 40 m along
transverse drift.
• Geological logging was completed, and the mineralised
intervals were determined by experienced geologists.
• All samples were submitted to commercial laboratories
for assay. Industry standard practice has been applied
on site to ensure sample presentively. The laboratories
have applied appropriate QA/QC to sample preparation
and appropriate calibration of QA/QC to analytical
instruments.
Wulong Project
• The trench, tunnel and diamond drill core samples were
collected.
• For the Wulong Mine, the tunnel samples were taken by
channeling method. The sample channel was
perpendicular or roughly perpendicular to the strike of
mineralised body. The section of channel was 10cm ×
5cm, the length was generally 1.0m, and the maximum
length was less than 1.5 m. The distance between
samples were 6m along drift, and 40 m along transverse
drift.
• For the Ligunzi Go ld Deposit, the trench samples were
taken by channeling method. The section of channel was
Appendix A JORC Code Table 1
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Criteria JORC Code explanation Commentary
10 cm × 3 cm, and the length was less than 1.5 m. The
drill core samples were sampled by 1/2 split core
method. The sample length was 1.0 m. The maximum
length was 1.5 m, and the minimum length was 0.2 m.
• For the Haojingou- Ligunzi Deposit, the trench samples
were sampled using channeling method. The section of
channel was 10 cm × 5 cm, and the length of 0.9m-1.0
m. The surface drilling core samples were sampled by
1/2 split core method. The sample length generally
ranges from 0.2 m to 1.5 m.
• The tunnel samples positi ons were determined by the
geologists and were sampled by the other workers.
• Geological logging was completed, and the mineralised
intervals were determined by experienced geologists.
• All samples were submitted to commercial laboratories
for assay. Industry standard practice has been applied
on site to ensure sample presentively. The laboratories
have applied appropriate QA/QC to sample preparation
and appropriate calibration of QA/QC to analytical
instruments.
Jintai Project
• Diamond drill core samples were collected.
• Drilling & sampling has b een conducted by Kunming
branch of Yunnan Geological Engineering Survey and
Design Institute, Dali Hengchuang Foundation
Engineering Co. LTD., the Shandong 6th Geology and
Mineral Exploration Institute and Yunnan Southern
Geological Exploration Engineering Corporation.
• Most of the trenches were not included in the Mineral
Resource estimate, just for the purpose of gold domain
exploration.
• Geological logging was completed, and the mineralised
intervals were determined by experienced geologists.
• All samples were submitted to commercial laboratories
for assay. Industry standard practice has been applied
on site to ensure sample presentively. The laboratories
have applied appropriate QA/QC to sample preparation
and appropriate calibration of QA/QC to analytical
instruments.
Hanfeng Project
• Diamond drill core samples and underground tunnel
samples were collected.
• Drilling & sampling of the dee p areas for both Lishan and
Dongfeng Mines has been conducted by Team 603 of
Jilin Province Non-ferrous Geological Exploration
Bureau.
• Most of the drilling and tunnel  samples were included in
the Mineral Resource estimate of the deep area.
• Geological logging was completed, and the mineralised
intervals were determined by experienced geologists.
• All samples were submitted to commercial laboratories
for assay. Industry standard practice has been applied
on site to ensure sample presentively. The laboratories
have applied appropriate QA/QC to sample preparation
and appropriate calibration of QA/QC to analytical
instruments.
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Criteria JORC Code explanation Commentary
Drilling
techniques
• Drill type (eg core, reverse circulation,
open-hole hammer, rotary air blast,
auger, Bangka, sonic, etc) and details
(eg core diameter, triple or standard
tube, depth of diamond tails, face-
sampling bit or other type, whether
core is oriented and if so, by what
method, etc).
Jilong Project
• All drill holes were conducte d by XY-4 drill rigs, with a
starting diameter of 110mm. After passing through the
Quaternary loose sedimentary layers, the diameter of
the drill bit was changed to 75 mm until termination of
the hole.
• The collars of the holes we re properly surveyed, and
down-hole surveying was undertaken at 50m intervals
starting at 25m deep after commencement.
• For the Zhuanshanz i #1#2#3&depth Block, the down-
hole survey was conducted with YT-1 little caliber
compass clinometer.
• For the Zhuanshanzi #4#5#6#7 Block, the down-hole
survey was conducted with BZM-R-B little caliber
compass clinometer.
Huatai Project
• The surface drill holes were conducted by XY-4 drill rigs,
with a starting diameter of 110 mm. After passing
through the Quaternary loose sedimentary layers, the
diameter of the drill bit was changed to 75 mm.
• The underground holes were  conducted by modified XY-
2 and XY-4 drill rigs, with a starting diameter of 75 mm
until termination.
• The collars of the holes we re properly surveyed, and
down-hole surveying was undertaken at 50m intervals
starting at 25m after commencement.
• For the Honghuagou #1 Min ing Zone, the down-hole
survey was conducted with KXP-2 little caliber compass
clinometer.
• For the Honghuagou #86 Vein, Pengjiagou Deposit and
Lianhuashan #26 Vein, the down-hole survey was
conducted with CX-6B little caliber compass clinometer.
• For the Lianhuasha n #5 Mining Zone and #3&7 Vein, the
down-hole survey was conducted with S42 little calibre
compass clinometer.
Wulong Project
• For the Wulong Mine, tunnels were excavated by
Wulong Mining. The profile of the tunnel was 1.8-2.0 m ×
2.0-2.2 m, and the slope was 0.3%-0.7%.
• For the Ligunzi Deposit, the bottom width of trenches is
0.6-0.8 m, the top width varied depending on the
looseness of the soil, and the depth of the trenches is at
least 0.3 m of the bedrock excavated.
• In 2010, two holes were drille d by the diamond wire line
core drilling technique with the XY-4 drilling rig. The
diameter is 75 mm. Drill holes survey were done with the
XJL compass clinometer. The depth was verified.
• The cross -section size of dri ft was 1.8-2.2 m × 2.0-2.3
m, and the slope was 0.3%-0.7%.
• For Haojingou-Ligunzi De posit, the width of trenches
was 1-1.2 m on the top and 0.6-08 m at the bottom. The
depth was 0-3 m and at least 0.3 m of the bedrock
should be excavated.
• A total of 73 surface borehol es were drilled during the
detailed exploration period in the exploration license
area. The types of drilling rigs were XY-4, XY-44 and
XY-B6. The hole’s diameter is 75 mm, and the core
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Criteria JORC Code explanation Commentary
diameter is 53 mm. A total of 14 underground boreholes
were drilled with a hole diameter of 47 mm and the core
diameter of 35 mm.
• The borehole depth was verified at the interval of 50 m
and after the borehole was finished.
• The profile of the t unnels along drift was 2.2 m × 2.5 m,
and the slope was less than 0.5%. The profile of the
raises was 2.0 m × 1.0-1.3 m, and the slope was 50°-
60°.
Jintai Project
• The borehole’s diameter i s greater than 75 mm, and the
core diameter is 55 mm. The cores were cleaned,
labelled, and placed regularly. The recovery rates for the
whole cores varied from 82% to 100% and for the
mineralised cores varied from 81% to 99%.
• The bottom width of trenches i s 0.6m-1.0 m and the top
width varied from 2.2 m to 2.5 m. At least 0.3 m of
bedrock should be excavated. All the trenches were
named regularly.
Hanfeng Project
• Lishan Mine:
The section size of the channel sample was 10cm ×
3cm, and the sample length is generally 1.0m ~ 1.5m.
The sample weight was generally 9.5kg ~ 10.5kg. The
relative error between the actual weight and the
theoretical weight of the sample is 0.04% ~ 9.76%. A
total of 789 samples were collected.
The drilling samples were sampled by ½ split core
method. The sample length was determined by core
recovery, thickness of mineralized body and
mineralization. The core was split along the core axis
into two halves by the YPK-1 type core splitter. The half
was retained as the core, and the other half was bagged
and weighed before being sent to the laboratory for
analysis. The sample length generally ranged from
1.00m to 1.50m, with a few samples ranging from 0.30m
to 0.80m and the longest being 1.90m.
• Dongfeng Mine:
The section size of the channel sample was 10cm ×
3cm, and the sample length is generally 1.0m ~ 1.5m.
The sample weight was generally 7.5kg ~ 8.5kg. The
relative error between the actual weight and the
theoretical weight of the sample is 0.00% ~ 4.80%. A
total of 702 samples were collected.
The drilling samples were sampled by ½ split core
method. The sample length was determined by core
recovery, thickness of mineralized body and
mineralization. The core was split along the core axis
into two halves by the YPK-1 type core splitter. One half
was retained as the core, and the other half was bagged
and weighed before being sent to the laboratory for
analysis. The sample length generally ranged from
1.00m to 1.50m, with a few samples ranging from 0.30m
to 0.80m and the longest being 2.00 m.
Drill sample
recovery
• Method of recording and assessing
core and chip sample recoveries and
results assessed.
• Measures taken to maximise sample
Jilong Project:
• For the Zhuanshanzi #1#2#3&depth Block, the recovery
rates for the whole cores varied from 86% to 100%, for
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Criteria JORC Code explanation Commentary
recovery and ensure representative
nature of the samples.
• Whether a relationship exists between
sample recovery and grade and
whether sample bias may have
occurred due to preferential loss/gain
of fine/coarse material.
the Zhuanshanzi #4#5#6#7 Block, the recovery rates for
the whole cores varied from 92% to 100%.
• There is no known relati onship between sample
recovery and grade.
Huatai project:
• For the Honghuagou #1 Mini ng Zone, the recovery rates
for the whole cores varied from 99.28% to 100%, and
the core recovery rates of #86 Vein varied from 75% to
100%, the core recoveries of Pengjiagou deposit varied
from 93% to 100%, and the core recoveries of
Lianhuashan #5 Mining Zone were 100%, the core
recoveries of #26 Vein and #3&7 Vein varied from 94%
to 100%.
• There is no known relati onship between sample
recovery and grade.
Wulong Project
• Lost core during the drilling is  recorded during geological
logging.
• The drilling program utilised drilling techniques to ensure
minimal loss of any size fraction.
• There is no known relati onship between sample
recovery and grade.
Jintai Project
• Lost core during the drilling is  recorded during geological
logging.
• The drilling program utilised drilling techniques to ensure
minimal loss of any size fraction.
• There is no known relati onship between sample
recovery and grade.
Hanfeng Project
• Lost core during the drilling is  recorded during geological
logging.
• The drilling program utilised drilling techniques to ensure
minimal loss of any size fraction.
• There is no known relati onship between sample
recovery and grade.
• The average recovery rate was 99% for both Lishan and
Dongfeng Mines
Logging • Whether core and chip samples have
been geologically and geotechnically
logged to a level of detail to support
appropriate Mineral Resource
estimation, mining studies and
metallurgical studies.
• Whether logging is qualitative or
quantitative in nature. Core (or
costean, channel, etc) photography.
• The total length and percentage of the
relevant intersections logged.
Jilong project:
• A total of 5,989.9 m t unnels along drift have been
geologically, hydro-geologically and geotechnically
logged at the Zhuanshanzi #1#2#3&depth Block.
Huatai project:
• A total of 17,143.24 m tunn els along drift have been
geologically, hydro-geologically and geotechnically
logged at the Honghuagou #1 Mining Zone, and a total
of 9,381.5m tunnels along drift have been geologically,
hydro-geologically and geotechnically logged at the
Lianhuashan #5 Mining Zone.
Wulong Project:
• Most Samples are geologically logged at 1.0 m.
• All trenches, tunnels, and retrieved drillcores have been
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Criteria JORC Code explanation Commentary
logged by geologists for recovery, lithology, alteration,
texture, mineralogy and mineralisation.
• Lost core is recorded dur ing geological logging
Jintai Project:
• Most Samples are geologically logged at 1.0 m.
• All trenches and retrieved cores have been logged by
geologists for recovery, lithology, alteration, texture,
mineralogy and mineralisation.
• Lost core is recorded dur ing geological logging
Wulong Project:
• The drilling core sample le ngth generally ranged from
0.5m to 1.5m. All samples were logged by geologists for
recovery, lithology, alteration, texture, mineralogy and
mineralisation.
Hanfeng Project:
• Lishan Mine
The drilling core sample length generally ranged from
1.0m to 1.5m, with a few samples ranging from 0.30m to
0.80m and the longest being 1.90m. All samples were
logged by geologists for recovery, lithology, alteration,
texture, mineralogy and mineralisation. Lost core is
recorded during geological logging.
• Dongfeng Mine
The core drilling sample length generally ranged from
1.0m to 1.5m, with a few samples ranging from 0.30m to
0.80m and the longest being 2.00m. All samples were
logged by geologists for recovery, lithology, alteration,
texture, mineralogy and mineralisation. Lost core is
recorded during geological logging.
Sub-sampling
techniques
and sample
preparation
• If core, whether cut or sawn and
whether quarter, half or all core taken.
• If non-core, whether riffled, tube
sampled, rotary split, etc and whether
sampled wet or dry.
• For all sample types, the nature,
quality and appropriateness of the
sample preparation technique.
• Quality control procedures adopted for
all sub-sampling stages to maximise
representivity of samples.
• Measures taken to ensure that the
sampling is representative of the in situ
material collected, including for
instance results for field
duplicate/second-half sampling.
• Whether sample sizes are appropriate
to the grain size of the material being
sampled.
Jilong and Huatai Projects
• both projects use the same sub-sampling techniques
and preparation procedures.
• the drilling samples were sampled by ½ split core
method.
• the sample preparation was based on the Chechott
formula: Q=Kd2, K=0.8. The core sample preparation
was conducted in the following procedures:
• the original samples were crushed passing a mesh of 30
screen;
• the sub-sample with 700g wa s collected from a riffle
splitter; and
• the sub-sample was pulverized passing a mesh of 200
screen; and about 200g of pulp sample was bagged and
labelled for analysis. The rest was stored as a pulp
reject.
Wulong Project
• the drilling samples were sampled by ½ split core
method.
• the sample preparation was based on the Chechott
formula: Q=Kd2, K=0.8. The core sample preparation
was conducted in the following procedures:
• the original samples were firstly coarse crushed by the
jaw crusher and were crushed to 10mm;
• the samples were then medium crushed to 0.25mm (60
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Criteria JORC Code explanation Commentary
mesh) by rod mill;
• the sub-sample with 350- 450g was collected as
duplicate from a riffle; and
• the sub-sample with 150-500g  was collected from a rifle
and was then pulverized passing a mesh of 200 screen;
and then was bagged and labelled for analysis.
Hanfeng Project
• the drilling samples were sampled by ½ split core
method by the YPK-1 type core splitter.
• The core sample weight was  between 0.63kg and 4.4kg,
and the tunnel sample weight was between 7.5kg and
10.5kg.
• the sample preparation incl uded coarse crushing (jaw
crusher), medium crushing (disc mill) and fine crushing
(disc mill). Each stage was divided into crushing,
screening, mixing and shrinkage.
Jintai Project
• The drilling samples were sampled by ½ split core
method. The sample length varies from 0.5 m to 1.5 m.
• The sample preparation included coarse crushing,
medium crushing and fine crushing. Each stage was
divided into crushing, screening, mixing and shrinkage.
• From 2020 to 2021, The total loss rate was less than
5%. The K value was set to 0.5 in the formulation Q =
Kd2 and the sample was crushed to 0.074 mm (200
mesh).
• From 2020 to 2022, The sample s were firstly coarse
crushed by the jaw crusher and were crushed to 4 mm.
Then the samples were medium crushed by the disc mill
and were crushed to 1 mm. After that, there were the
mixing and splitting procedures. The K value was set to
0.8 in the formulation Q = Kd2 and the sample was
crushed to 0.074 mm (200 mesh).
• Both internal and external lab check samples were
according to the Specification of Testing Quality
Management for Geological Laboratories.
Quality of
assay data and
laboratory
tests
• The nature, quality and
appropriateness of the assaying and
laboratory procedures used and
whether the technique is considered
partial or total.
• For geophysical tools, spectrometers,
handheld XRF instruments, etc, the
parameters used in determining the
analysis including instrument make
and model, reading times, calibrations
factors applied and their derivation,
etc.
• Nature of quality control procedures
adopted (eg standards, blanks,
duplicates, external laboratory checks)
and whether acceptable levels of
accuracy (ie lack of bias) and precision
have been established.
Jilong Project
• Verifications by Jilong Mining: A total of 853 internal
check samples have been adopted before 2018
production report, the qualification rate is 98.48%; and
447 samples have been adopted for external check, the
qualification rate is 98.66%. During the 2018 production
exploration report, a total of 297 samples were selected
as internal duplicates, the qualification rate is 98.32%; a
total of 149 samples were selected for external check,
the qualification rate is 97.32%.
• Verifications by SRK:  A t otal of 154 samples were
selected and sent to SGS Laboratory located in Tianjin,
China for verification assay. A large bias was observed
between the original assay and check results, SRK
advised to send the samples to Intertek laboratory for re-
analysis. The returned results show that a general trend
can be observed although larger bias is found in the
higher-grade samples, which may be led by the nugget
effect of visible gold.
Huatai Project
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Criteria JORC Code explanation Commentary
• Verifications by Huatai Min ing:  A total of 51 samples
internal duplicates during the 2013 Pengjiagou detailed
exploration have been applied, the internal check
qualification rate was 96.58%; 30 samples have been
selected for external check, the external check
qualification rate was 95.26%
• Verifications by SRK: A to tal of 50 samples were
selected from the Honghuagou Mine and sent to SGS
Laboratory located in Tianjin, China for verification
assay. A large bias was observed between the original
assay and check results, SRK advised to send the
samples Intertek laboratory for re-analysis. The returned
results show that a general trend can be observed
although larger bias is found in the higher-grade
samples, which may be led by the nugget effect of
visible gold. For A total of 55 samples from the
Lianhuashan Mine were selected and sent them to SGS
for re-analysis. A large bias was observed between the
original assay and check results. About 60% results for
Au are within ±20%. About 40% results are out of ±20%,
which may be caused by the nugget effect.
Wulong Project
• Verifications by Wulong Mining: a total of 164 samples
were taken during 2016 resource verification report, for
internal verification, with a qualification rate of 97.56%
and 72 samples for external verification, with a
qualification rate of 94.17%. During the 2017 annual
report, 30 internal verification samples were taken, with
a qualification rate of 96.67%. In 2018, 35 internal
verification samples were taken, with a qualification rate
of 100% for internal verification and 30 external
verification samples, with a qualification rate of 100% for
external verification. During the 2019 resource
verification report, 41 internal verification samples were
taken, with a 100% qualification rate and 30 external
verification samples, with a 100% qualification rate for
external inspection.
• Verifications by SRK: For H aojingou-Ligunzi deposit, a
total of 36 have been taken. A small bias was observed
between the original assay and check results. About
88.9% results for Au are within ±20%. About 11.1% of
the results are out of ±20%, which may be caused by the
nugget effect. For the Wulong mine, a total of 129
samples (about 3% of total above 1g/t Au) have been
taken, most of the returned analysis results are within
±20%, which are acceptable.
Jintai Project
• Verifications by Jintai Min ing: From 2007 to 2010, a total
of 30 samples were taken for internal lab check with a
proportion of 1.99%. 30 samples were taken for external
lab check with a proportion of 1.99%. The qualification
rate was 70% for internal check and 56.67% for external
check. From 2020 to 2021, a total of 50 samples were
taken for internal lab check with a proportion of 8.91%.
31 samples were taken for external lab check with a
proportion of 5.51%. The qualification rate was 70% for
internal check and 100% for external check. From 2012
to 2022, a total of 819 samples were taken for internal
lab check with a proportion of 8.51%. 350 samples were
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Criteria JORC Code explanation Commentary
taken for external lab check with a proportion of 3.63%.
The qualification rate was 68.62% for internal check and
89.71% for external check.
• Verifications by SRK: A tota l of 77 samples (4.25% of
total above 0.17 g/t Au samples) have been sent to SGS
Mineral Laboratory located in Tianjin, China. The scatter
diagrams show that about 52% results for Au are within
±20%. About 48% results are out of ±20%, which may be
caused by the nugget effect.
Hanfeng:
• Verifications by Hanfeng Mining: Internal and external
check samples’ results were provided; however, the
original samples were not provided. 1,208 samples were
taken for internal analysis with a qualification rate of 96%
for internal analysis; 710 samples were taken for
external analysis with a qualification rate of 97% for
external analysis. 80 samples were taken for internal
analysis with a 95% pass rate for internal analysis, and
40 samples were taken for external analysis with a 100%
pass rate for external analysis. 80 samples were taken
for internal analysis with a pass rate of 99% for internal
analysis, 40 samples were taken for external analysis
with a pass rate of 100% for external analysis.
• Verifications by SRK: For the Lishan Project, a total of
152 samples have been taken (about 3% of total above
0.5% Zn), with most of the returned analysis results for
Cu and Zn are within ±20%, the Pb have returned poorer
performance, however, most of which are in the very low
grade, thus the results are considered acceptable. For
the Dongfeng project, a total of 189 samples have been
taken, with all of the returned analysis results for Mo are
within ±20%, which are acceptable.
Verification of
sampling and
assaying
• The verification of significant
intersections by either independent or
alternative company personnel.
• The use of twinned holes.
• Documentation of primary data, data
entry procedures, data verification,
data storage (physical and electronic)
protocols.
• Discuss any adjustment to assay data.
• All geological logging and sampling information were
completed on paper logs before being transferred to
Excel spreadsheets. All logging and sampling data were
routinely checked by Mining's technical management
team and provided to the Mining for storage. Soft copies
of all information were finally provided.
Location of
data points
• Accuracy and quality of surveys used
to locate drill holes (collar and down-
hole surveys), trenches, mine workings
and other locations used in Mineral
Resource estimation.
• Specification of the grid system used.
• Quality and adequacy of topographic
control.
Jilong and Huatai Projects
• The coordinate system of Jil ong mine is CGCS 2000 and
Zone GK N40. The drillhole collars and topography
(1:2000) were surveyed by RTK.
Wulong Project
• The coordinate system fo r both Wulong mine and
Ligunzi deposit is Beijing 54, while the Xi’an 80 is used
for the Haojingou-Ligunzi deposit.
• The topographic map survey  utilizes a scale of 1:2000.
Jintai Project
• All the drill hole collars were surveyed under
CGCS2000.
• The topographic map survey u tilizes a scale of 1:2000.
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Criteria JORC Code explanation Commentary
Hanfeng Project
• The coordinate syst em is CGCS2000.
• The topographic map survey  utilizes a scale of 1:2000.
Data spacing
and
distribution
• Data spacing for reporting of
Exploration Results.
• Whether the data spacing and
distribution is sufficient to establish the
degree of geological and grade
continuity appropriate for the Mineral
Resource and Ore Reserve estimation
procedure(s) and classifications
applied.
• Whether sample compositing has been
applied.
Jilong Project
• Data space is 40m × 6m(strike),
• Data space is sufficient to  establish the degree of
geological and grade continuity appropriate for the
Mineral Resource and Ore Reserve estimation
procedure(s) and classifications applied.
• For the #1# 2#3&depth Block, a  0.4 m interval composite
length was selected for compositing. For the #4 #5 #6 #7
Block, the composite length is 1m.
Huatai Project
• Huatai Project: Data space is 40m × 20m(strike),
• Data space is sufficient to  establish the degree of
geological and grade continuity appropriate for the
Mineral Resource and Ore Reserve estimation
procedure(s) and classifications applied.
• For #1 Mining Zone, a 0.8 m i nterval composite length
was selected for compositing.  For #86 Vein, #26 Vein,
#3&#7 Vein, #5 Mining Zone, and Pengjiagou mine, the
composite length is 0.5m.
Wulong Project
• For Wulong Mine, the leve l interval is 40 m
approximately. The spacing between the channels of
tunnel samples is 6 m.
• For Ligunzi Deposit, the level interval is 40 m
approximately. The spacing between the channels of
tunnel samples is 4 m. The trench spacing is 100 m to
200 m approximately.
• For Haojingou-Ligunzi Depo sit, the drill spacing is 80 m
to 80 m approximately.
• Data spacing & di stribution is considered acceptable for
establishing geological continuity & grade variability
appropriate for classifying a Mineral Resource.
Jintai Project
• The drill spacing is 80 m to 80 m approximately.
• Data spacing & di stribution is considered acceptable for
establishing geological continuity & grade variability
appropriate for classifying a Mineral Resource.
Hanfeng Project
• Lishan Mine ：fan drill rig was applied for the mineralized
veins exploration, the main drillhole density is 40 m to
160 m approximately, the height between the drifts is
about 40m-80m.
• Lishan Mine ：fan drill rig was applied for the mineralized
veins exploration, the main drillhole density is 50 m to
200 m approximately, the drift space is about 40m-
100m.
Orientation of
data in relation
• Whether the orientation of sampling
achieves unbiased sampling of
possible structures and the extent to
which this is known, considering the
Jilong and Huatai Projects
• No material biased sampling result was recognized.
• Not applicable to  this project.
– IIIA-392 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1218 ---
Criteria JORC Code explanation Commentary
to geological
structure
deposit type.
• If the relationship between the drilling
orientation and the orientation of key
mineralised structures is considered to
have introduced a sampling bias, this
should be assessed and reported if
material.
Wulong Project
• No drilling orientation & sampling bias has been
recognized at this time.
Jintai Project
• No drilling orientation & sampling bias has been
recognized at this time.
Hanfeng Project
• No drilling orientation & sampling bias has been
recognized at this time.
Sample
security
• The measures taken to ensure sample
security.
Jilong and Huatai Projects
• Some core samples are exposed to the outdoors, which
is an issue that needs to be addressed.
Wulong Project
• Samples were stored in a s ecured location. Internally,
the commercial laboratories operate an audit trail
tracking the samples at all times whilst in their custody.
Jintai Project
• Samples were stored in a s ecured location. Internally,
the commercial laboratories operate an audit trail
tracking the samples at all times whilst in their custody.
Hanfeng Project
• Samples were stored in a s ecured location. Internally,
the commercial laboratories operate an audit trail
tracking the samples at all times whilst in their custody.
Audits or
reviews
• The results of any audits or reviews of
sampling techniques and data.
Jilong and Huatai Projects
• A review of the sampling techniques and data was
carried out by SRK as part of the Resource estimate and
the database is considered to be sufficient quality to
carry out Resource estimation.
Wulong Project
• SRK visited the drill core sto re, sample preparation lab
and carried inspection of drillhole sealing mark. Internal
reviews are completed on sampling techniques & data.
Jintai Project
• SRK visited the drill core sto re, sample preparation lab
and carried inspection of drillhole sealing mark. Internal
reviews are completed on sampling techniques & data.
Hanfeng Project
• SRK visited the drill core s tore. Internal reviews are
completed on sampling techniques & data.

– IIIA-393 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1219 ---
Section 2 Reporting of Exploration Results
(Criteria listed in the preceding section also apply to this section.)
Criteria JORC Code explanation Commentary
Mineral
tenement and
land tenure
status
• Type, reference name/number, location
and ownership including agreements or
material issues with third parties such
as joint ventures, partnerships,
overriding royalties, native title
interests, historical sites, wilderness or
national park and environmental
settings.
• The security of the tenure held at the
time of reporting along with any known
impediments to obtaining a licence to
operate in the area.
Jilong Project
• Two mining licenses are curr ently held by Jilong Mining.
One mining licence covering 6.24km2, valid till 29 Sep.
2026, the other one covering 9.134km2, valid till 27 Mar.
2032. No proximate Classified Forests and historical
sites were reported.
Huatai Project
• Six mining licenses are curr ently held by Huatai Mining.
#26 Vein covering 0.3199km2, valid till 17 Nov. 2024.
#3&#7 Vein covering 1.016km2, valid till 5 Sep. 2025. #5
Mining Zone covering 0.8138km2, valid till 14 Sep. 2024.
#86 Vein covering 1.8332km2, valid till 17 Nov. 2025. #1
Mining Zone covering 2.7978km2, valid till 5 Jun. 2024.
Pengjiagou Mine covering 3.7362km2, valid till 17 Nov.
2025. No proximate Classified Forests and historical
sites were reported.
• Regarding any impe diments, it is unknown to SRK at this
moment.
Wulong Project
• The deposits are located within Mining Leases No.
C2100002011084140116558 and Exploration Tenement
T2100002008044010006347 and
T211200804020005662.
• SRK have not independently v erified the standing of the
tenements.
Jintai Project
• The deposits are located within Mining Leases NO
C5300002012054110124688 and Exploration Tenement
T5300002009034010026977.
• SRK have not independently v erified the standing of the
tenements.
Hanfeng Project
• Lishan Mining Area in Tianbaoshan Lead-Zinc Mine, its
Mining License No. C2224002021083210152512
• Dongfeng Mining Area in Tia nbaoshan Lead-Zinc Mine,
its Mining License No. C2200002010123120093830
Exploration
done by other
parties
• Acknowledgment and appraisal of
exploration by other parties.
Jilong Project
• For the Zhuanshanzi 1#2#3#& depth Block, 81 diamond
boreholes were carried out, and 6240 Tunnels were
conducted.
• For the Zhuanshanzi #4#5#6# 7 Blocks, 64 diamond
boreholes were carried out, 12 Tunnels were conducted,
and 55 Trenches were conducted.
Huatai Project
• For the Honghuag ou deposit, 96 diamond boreholes
were carried out, and 764 Tunnels were conducted.
• For the Pengjiagou deposit, 44 diamond boreholes were
carried out, and 112 Tunnels were conducted.
• For the Lianhuashan deposit, 96 diamond boreholes
– IIIA-394 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1220 ---
Criteria JORC Code explanation Commentary
were carried out, and 1,153 Tunnels were conducted.
Wulong Project: See Section 5.3.
Jintai Project: See Section 5.5.
Hanfeng Project: See Section 5.4.
Geology • Deposit type, geological setting and
style of mineralisation.
Jilong and Huatai Projects:
• The genetic type is medium-low temperature
hydrothermal gold deposit. The gold-bearing quartz
veins filled mainly along suitable faults and/or fractures.
Wulong Project:
• The Wulong Gold Mine is a large quartz vein type gold
mine, the mineralized body is controlled by two groups of
fault structures, the north-west trending faults, and the
north-east trending faults. The wall rocks are mixed
granite, mixed granite gneiss, fine-grained diorite, and
granite porphyry et al. The ore type is mainly quartz vein
type, and the industrial type of the deposit is gold-
bearing quartz single vein type.
Jintai Project:
• The metallogenic mechanism  of the deposits was that
gold was activated and dissolved under the action of
high temperature and high pressure by the underground
hot brine and entered underground hot water in the form
of complex ions to form gold-bearing hydrothermal liquid.
The hydrothermal liquid rose along the structure and
fracture in the thermal cycle. Near the surface, due to
the decrease of temperature and pressure, a large
amount of silicon in the hydrothermal liquid (hot spring)
precipitated, with a small amount of gold. Due to the
large amount of silicon precipitation, the channel was
gradually blocked, and the temperature and pressure of
the hydrothermal liquid increased. The rapid decrease of
temperature and pressure led to the rapid decrease of
gold solubility in hot water, with a large amount of gold
precipitation near the surface at a certain depth. This
process was repeated many times, and gold domains
were eventually formed and further enriched in the
weathering process.
Hanfeng Project:
• Lishan Pb-Zn Deposit (Below the -92m asl) is a zinc
polymetallic deposit dominated by zinc ore, with some
copper and lead. The mineralised bodies are lenticular
and lentil shaped. There are 128 zinc-lead-copper
mineralized bodies were defined.
• Dongfeng Mo Deposit (above 250m asl) mainly occurs in
the porphyritic monzogranite, contact zone of
granodiorite and volcanic rock and schistosity zone of
quartz diorite porphyry, which are mostly composed of
quartz veins and altered breccia.
• According to the geological characteristics of the
deposit, including the wall rock alteration, ore texture
and structure, the Lishan deposit belongs to post-
magmatic mesothermal filling metasomatic polymetallic
deposit. The Dongfeng deposit belongs to the skarn-type
polymetallic deposit.
– IIIA-395 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1221 ---
Criteria JORC Code explanation Commentary
Drill hole
Information
• A summary of all information material to
the understanding of the exploration
results including a tabulation of the
following information for all Material drill
holes:
o easting and northing of the drill hole
collar
o elevation or RL (Reduced Level –
elevation above sea level in metres)
of the drill hole collar
o dip and azimuth of the hole
o down hole length and interception
depth
o hole length.
• If the exclusion of this information is
justified on the basis that the
information is not Material and this
exclusion does not detract from the
understanding of the report, the
Competent Person should clearly
explain why this is the case.
Jilong Project
• For the Zhuanshanzi #1#2#3&dept h Block, it is informed
by data from 81 drillholes, for a combined length of
19,078.32m, and 6,240 tunnels, for a combined length of
5,989.89 m, with a total of 14,930 assay samples.
• For the Zhuanshanzi #4#5#6#7 Block, it is informed by
data from 64 drillholes, for a combined length of
10,810.47m, with a total of 339 assay samples, 55
trenches, for a combined length of 90.69 m, with a total
of 106 assay samples, and 12 tunnel, for a combined
length of 45.94 m, with a total of 87 assay samples.
Huatai Project
• A total of 236 drillholes, fo r a combined length of
57,043.07m, and 2,029 tunnels, for a combined length of
4,474.51 m, with a total of 6,973 assay samples.
• All information of drillholes carried out so far in Jilong
and Huatai project area are collected, including collar,
elevation, depth, survey etc. and details see database
along with this report.
Wulong Project
• SRK’s estimation of the Mi neral Resources documented
in this report is informed by data from 139 drillholes, for
a combined length of 38,160 m, and 5,601 tunnels, for a
combined length of 9,542 m, and 282 trenches, for a
combined length of 171 m, with a total of 17,389 assay
samples. The boundary of the estimation is the Wulong
mining licence, Ligunzi and Haojingou-Ligunzi
exploration permits.
Jintai Project
• Database used for Mineral R esource estimate contains
208 holes / 14,720.68 m.
Hanfeng Project
• As of March, 2024. There were 194 drillholes （
46,351.96 m) and 102 tunnel samples (477.3m) in the
resource database for Lishan Mine and 252 drillholes（
88,402 m) and 63 tunnel samples (431m) in the
database for Dongfeng Mine.
Data
aggregation
methods
• In reporting Exploration Results,
weighting averaging techniques,
maximum and/or minimum grade
truncations (e.g. cutting of high grades)
and cut-off grades are usually Material
and should be stated.
• Where aggregate intercepts incorporate
short lengths of high grade results and
longer lengths of low grade results, the
procedure used for such aggregation
should be stated and some typical
examples of such aggregations should
be shown in detail.
• The assumptions used for any reporting
of metal equivalent values should be
clearly stated.
Jilong Project
• Exploration data is reporte d as the average sample
grade over the mineralised intersection. The mineralised
domain is defined at cut-off grade of 1.5g/t Au.
• Jilong project: For the Zhuanshanzi #1#2#3&depth
Block, Capping grade is 52g/t. For the Zhuanshanzi
#4#5#6#7 Block, no capping was applied.
• Not applicable to this project
Huatai Project
• Exploration data is reporte d as the average sample
grade over the mineralised intersection. The mineralised
domain is defined at cut-off grade of 1.5 g/t Au.
• Huatai project: Capping gra de had been applied in six
mineralised zones, and details see evaluation of outliers
along with this report.
– IIIA-396 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1222 ---
Criteria JORC Code explanation Commentary
• Not applicable to this project
Wulong Project
• The main mineralisation outlier value samples have
been capped.
• For Wulong deposit and Hao jingou-Ligunzi deposit, all
raw samples were composited to 1 m downhole lengths,
with a minimum of 0.75 m for each composite sample.
• For Ligunzi deposit, all raw samples were composited to
2 m downhole lengths, with a minimum of 1.5 m for each
composite sample.
• No metal equivale nts are reported.
Jintai Project
• The main mineralisation outlier value samples have
been capped.
• All raw samples were com posited to 1 m downhole
lengths, with a minimum of 0.75 m for each composite
sample.
• No metal equivale nts are reported.
Hanfeng Project
• Assay capping for Pb, Zn and Cu was applied for the
mineralized domains of Lishan Mine and Assay capping
for Mo for Dongfeng Mine.
• A composite length of 1 m was chosen for both Lishan
and Dongfeng Mine as it does not distort the grade
distribution for the mine when compared to the length-
weighted raw grade statistics.
• No metal equivale nts are reported.
Relationship
between
mineralisatio
n widths and
intercept
lengths
• These relationships are particularly
important in the reporting of Exploration
Results.
• If the geometry of the mineralisation
with respect to the drill hole angle is
known, its nature should be reported.
• If it is not known and only the down hole
lengths are reported, there should be a
clear statement to this effect (eg ‘down
hole length, true width not known’).
Jilong and Huatai Projects
• True width was calculated and as such only downhole
lengths were reported.
• Most tunnels are perpendicul ar to the gold mineralized
body.
• Not applicable.
Wulong and Jintai Projects
• SRK was provided with section maps of all mineralized
domains. SRK has constructed the solid models
according to the maps provided by the client and they
are acceptable for the estimation.
Hanfeng Project
• SRK was provided with section and plan maps of all
mineralized domains. SRK generated the solid model for
each veins according to the drillholes and tunnelling
data.
Diagrams • Appropriate maps and sections (with
scales) and tabulations of intercepts
should be included for any significant
discovery being reported These should
include, but not be limited to a plan view
of drill hole collar locations and
appropriate sectional views.
Jilong: Shown in the: Mineral Resource Estimation section
of this Report.
Huatai: Shown in the: Mineral Res ource Estimation section
of this Report.
Wulong: Please refer to the report.
Jintai: Please refer to the report.
Hanfeng: Please refer to the report.
– IIIA-397 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1223 ---
Criteria JORC Code explanation Commentary

Balanced
reporting
• Where comprehensive reporting of all
Exploration Results is not practicable,
representative reporting of both low and
high grades and/or widths should be
practiced to avoid misleading reporting
of Exploration Results.
Jilong and Huatai: Reporting was fully representative of the
data provided at this stage.
Wulong and Jintai:  No other exploration results for the
project.
Hanfeng: No other exploration results for the project.
Other
substantive
exploration
data
• Other exploration data, if meaningful
and material, should be reported
including (but not limited to): geological
observations; geophysical survey
results; geochemical survey results;
bulk samples – size and method of
treatment; metallurgical test results;
bulk density, groundwater, geotechnical
and rock characteristics; potential
deleterious or contaminating
substances.
Jilong, Huatai, Wulong, Jintai, Hanfeng Projects
SRK is not aware of any ot her material or substantive
exploration data that has not been reported.
Further work • The nature and scale of planned further
work (eg tests for lateral extensions or
depth extensions or large-scale step-
out drilling).
• Diagrams clearly highlighting the areas
of possible extensions, including the
main geological interpretations and
future drilling areas, provided this
information is not commercially
sensitive.
Jilong and Huatai Projects
• Having a structured QA/QC p rocess is necessary for the
company's future exploration work, including controlling
the insertion of samples (i.e. blank, standard and
duplicate samples).
• For the Jilong and Huatai p roject, safe retention of
coarse waste and powder samples is necessary.
Wulong Project
• SRK suggests that further detailed infill drilling
exploration, rock mechanical, hydrogeological studies,
seismic surveys, metallurgical testing, and other
exploration activities should be conducted in the future.
Jintai Project
• SRK suggests that further detailed infill drilling
exploration, rock mechanical, hydrogeological studies,
seismic surveys, metallurgical testing, and other
exploration activities should be conducted in the future.
Hanfeng Project
• SRK recommends carrying out i n-fill drilling exploration
and/or underground exploration for resource category
upgrade to meet life of mine plan for lower parts of
Lishan and Dongfeng mines.

Section 3 Estimation and Reporting of Mineral Resources
 (Criteria listed in section 1, and where relevant in section 2, also apply to this section.)
Criteria JORC Code explanation Commentary
Database
integrity
• Measures taken to ensure that data has
not been corrupted by, for example,
transcription or keying errors, between
its initial collection and its use for
Mineral Resource estimation purposes.
Jilong and Huatai Projects
• The data provided by the Company in access format
was imported into Surpac (Ver2020.1) and validated.
• Data validation steps included: Validation through
– IIIA-398 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1224 ---
Criteria JORC Code explanation Commentary
• Data validation procedures used. constraints set in the database, e.g., overlapping/missing
intervals, intervals exceeding maximum depth, valid
geology codes, missing assays; Validation through 3D
visualization to check for any obvious collar, down-hole
survey, or assay import errors.
Wulong Project
• The original data have been compiled into an exploration
report adhering to Chinese standards, featuring the
relevant plan and profile maps and tables. SRK has
finished organizing, validating, and establishing the
database.
• The data validation process in volves: Setting restrictions
in the database to ensure validation, such as checking
for duplicate/exact sampling intervals, ensuring sampling
intervals do not exceed the maximum hole depth,
validating geological codes, and addressing missing
assays. Inspecting for errors in the import of Collar,
Survey, and Assay data through a 3D view.
Jintai Project
• The original data have been compiled into an exploration
report adhering to Chinese standards, featuring the
relevant plan and profile maps and tables. SRK has
finished organizing, validating, and establishing the
database.
• The data validation process in volves: Setting restrictions
in the database to ensure validation, such as checking
for duplicate/exact sampling intervals, ensuring sampling
intervals do not exceed the maximum hole depth,
validating geological codes, and addressing missing
assays. Inspecting for errors in the import of Collar,
Survey, and Assay data through a 3D view.
Hanfeng Project
• The original data have been compiled into an exploration
report adhering to Chinese standards, and profile maps
and tables. SRK has sorted out, validate and complied
the database.
• The data validation process in volves: Setting restrictions
in the database to ensure validation, such as checking
for duplicate/exact sampling intervals, ensuring sampling
intervals do not exceed the maximum hole depth,
validating geological codes, and addressing missing
assays. Inspecting for errors in the import of Collar,
Survey, and Assay data through a 3D view.
Site visits • Comment on any site visits undertaken
by the Competent Person and the
outcome of those visits.
• If no site visits have been undertaken
indicate why this is the case.
Jilong Project: The site visit was conducted by SRK team
during 23-25 December 2022 and 14 to 15 May 2024.
Huatai Project: The site visit was conducted by SRK team
during 23-25 December 2022 and 14 to 15 May 2024.
Wulong Project: The site visit was conducted during 22-23
December 2022 and 16 to 17 May 2024.
Jintai Project: The site visit was conducted during 7-9 March
2023 and 21-23 May 2024.
Hanfeng Project: SRK conducted a site inspection to the
Jilin Hanfeng on 9-10 January 2023 and 17-18 May 2024.
– IIIA-399 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1225 ---
Criteria JORC Code explanation Commentary
Geological
interpretation
• Confidence in (or conversely, the
uncertainty of ) the geological
interpretation of the mineral deposit.
• Nature of the data used and of any
assumptions made.
• The effect, if any, of alternative
interpretations on Mineral Resource
estimation.
• The use of geology in guiding and
controlling Mineral Resource
estimation.
• The factors affecting continuity both of
grade and geology.
Jilong Project
• The geological interpretation is specifically based on
lithology, and Au grade.
• Mineralization domains w ere based on geological
interpretation & mineralised trends.  44 Solid models
were created at the Zhuanshanzi #1#2#3&depth Block
and 4 Solid models were created at the Zhuanshanzi
#4#5#6#7 Block by sectional interpretation of the drilling
dataset. Domain boundaries were modelled to a 1g/t Au.
Domain boundaries were treated as hard boundaries.
• Geological domains were based on rock types.
Huatai Project:
• The geological interpretation is specifically based on
lithology, and Au grade.
• Mineralization domains w ere based on geological
interpretation & mineralised trends.  A total of 16
mineralized domains were constructed in Honghuagou
mine, a total of 6 mineralized domains were constructed
in Pengjiagou deposit, and a total of 12 mineralized
domains were constructed in Lianhuashan deposit.
Domain boundaries were modelled to a 1g/t Au. Domain
boundaries were treated as hard boundaries.
• Geological domains were based on rock types.
Wulong Project:
• Geological interpretation is  based on information such as
collar, survey, lithology, and assay data. It is also
supported by surface geological mapping and trenching.
• The mineralized domains w ere interpreted by the
samples collected based on a cut-off grade of 1.0 g/t Au.
• The data used for resource estimation is derived from
reliable exploration reports and laboratory analysis.
• A total of 33 mineralized dom ains were constructed in
Wulong mine, a total of 6 mineralized domains were
constructed in Ligunzi deposit, and a total of 17
mineralized domains were constructed in Haojingou-
Ligunzi deposit.
Jintai Project:
• Geological interpretation is  based on information such as
collar, survey, lithology, and assay data. It is also
supported by surface geological mapping and trenching.
• The mineralized domains w ere interpreted by the
samples collected based on a cut-off grade of 0.17 g/t
Au.
• The data used for resource estimation is derived from
reliable exploration reports and laboratory analysis.
• Nine mineralized domains h ave been identified in the
model and are denoted as v1, v2, v4, v5, v6, v7, v8, v9,
and v10.
• The drill spacing bet ween 80-160 meters apart, with the
majority measuring 80 by 80 meters.
Hanfeng Project:
• Geological interpretation is  based on information such as
collar, survey, lithology, assay data and geological
mapping and reports.
• The Lishan lead-zinc mineralization (below-92m asl)
– IIIA-400 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1226 ---
Criteria JORC Code explanation Commentary
consists of 128 veins. The vein domains were modelled
using a broad 0.5% Zn cutoff, and a total of 178
molybdenum orebodies of varying sizes of Dongfeng
Mine have been modelled using a cutoff of 0.03% Mo in
leapfrog by the vein tool.
• The data used for resource estimation is derived from
reliable exploration reports and laboratory analysis.
Dimensions • The extent and variability of the Mineral
Resource expressed as length (along
strike or otherwise), plan width, and
depth below surface to the upper and
lower limits of the Mineral Resource.
Jilong and Huatai Projects: It is detailed in the Report.
Wulong and Jingtai Projects:  Extrapolation was limited to
approximately half of the level interval and the drill spacing.
Internal interpolation was normally 80 m, with a maximum of
160 m.
Hanfeng Project: detailed in the Report.
Estimation
and modelling
techniques
• The nature and appropriateness of the
estimation technique(s) applied and key
assumptions, including treatment of
extreme grade values, domaining,
interpolation parameters and maximum
distance of extrapolation from data
points. If a computer assisted
estimation method was chosen include
a description of computer software and
parameters used.
• The availability of check estimates,
previous estimates and/or mine
production records and whether the
Mineral Resource estimate takes
appropriate account of such data.
• The assumptions made regarding
recovery of by-products.
• Estimation of deleterious elements or
other non-grade variables of economic
significance (eg sulphur for acid mine
drainage characterisation).
• In the case of block model interpolation,
the block size in relation to the average
sample spacing and the search
employed.
• Any assumptions behind modelling of
selective mining units.
• Any assumptions about correlation
between variables.
• Description of how the geological
interpretation was used to control the
resource estimates.
• Discussion of basis for using or not
using grade cutting or capping.
• The process of validation, the checking
process used, the comparison of model
data to drill hole data, and use of
reconciliation data if available.
Jilong Project:
• The estimation method for Au was Inverse Distance
Weighting Square (IDW) by using Surpac software.
• For the Zhuanshanzi #1#2#3&depth Block, the bock size
was set to be 4 m (X) × 4 m (Y) × 4 m (Z). The sub-block
size was set to be 1 m (X) × 1 m (Y) × 1 m (Z); for the
Zhuanshanzi #4#5#6#7 Block, the bock size was set to
be 4 m (X) × 4 m (Y) × 4 m (Z). The sub-block size was
set to be 0.5 m (X) × 0.5 m (Y) × 0.5 m (Z).
• The interpolation was conduc ted three times, see report
for search parameters.
• SRK conducted outlier handling for Au.
• Model validation was perfo rmed using Swath plot
comparison.
Huatai Project:
• The estimation method for Au was Inverse Distance
Weighting Square (IDW) by using Surpac software.
• For #1 Mining Zone of Honghuagou, a block size of 4 m
(X) × 4 m (Y) × 4 m (Z) was used. For #86 Vein of
Honghuagou mine, #26 Vein #3&#7 Vein and #5 Mining
zone of Lianhuashan mine, and Pengjiagou mine, a
block size of 2 m (X) × 2 m (Y) × 2 m (Z) was used. And
the sub-size of all zones was set to be 1 m (X) × 1 m (Y)
× 1 m (Z).
• The interpolation was conduc ted three times, see report
for search parameters.
• SRK conducted outlier handling for Au.
• Model validation was perfo rmed using Swath plot
comparison.
Wulong Project:
• A block size of 4 m easting by 4 m northing by 4 m
elevation was used. The block model used the same
coordinate system as that was used in data collection.
• The Inverse Distance Weighting Square (IDW 2) method
was used for grade estimation via Surpac in the block
model.
• Conduct three sets of search int erpolations, employing a
minimum of 1 and a maximum of 25 composite samples
per block for grade interpolation, with the search radius
progressively increasing from 40m or 45m to 180m or
200m.
• SRK performed a thorough validation of the interpolation
– IIIA-401 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1227 ---
Criteria JORC Code explanation Commentary
model results, which included visual examination and
"Swath Plots" analysis
Jintai Project:
• A block size of 10 m easting  by 10 m northing by 5 m
elevation was used. The block model used the same
coordinate system as that was used in data collection.
• The Inverse Distance Weighting Square (IDW 2) method
was used for grade estimation via Surpac in the block
model.
• Conduct three sets of search int erpolations, employing a
minimum of one and a maximum of 25 composite
samples per block for grade interpolation, with the
search radius progressively increasing from 40m or 80m
to 160m.
• SRK performed a thorough valid ation of the interpolation
model results, which included visual examination and
"Swath Plots" analysis.
Hanfeng Project:
• Suitable block interval and un it size was adopted to build
a block model which was able to contain the mineralized
zones. details in section 13.4.8
• The Inverse Distance Weig hting Square (ID2) method
was used for grade estimation via Surpac in the block
model.
• Three different search ellips oids were aligned with the
different mineralization orientations for both Lishan and
Dongfeng Mine.
• The swath plot validation ap proach was adopted by SRK
for the validation.
Moisture • Whether the tonnages are estimated on
a dry basis or with natural moisture,
and the method of determination of the
moisture content.
Jilong, Huatai, Wulong, Jingtai, Hanfeng Projects:
Tonnages are estimated on a dry basis.

Cut-off
parameters
• The basis of the adopted cut-off
grade(s) or quality parameters applied.
Jilong and Huatai Projects:
• A cut-off grade of 1.5g/t Au is selected to report the
Mineral Resources.
• The underground reso urces of this project are reported
based on the underground mining and the corresponding
mineralised domains and cut-off grades.
Wulong Project:
• A 1.0 g/t cut-off grade wa s used to report the in situ
Mineral Resources. This cut-off grade is estimated to be
the minimum grade required for eventual economic
extraction at current prices.
Jintai Project:
• A 0.17 g/t cut-off grade wa s used to report the in situ
Mineral Resources. This cut-off grade is estimated to be
the minimum grade required for eventual economic
extraction at current prices.
Hanfeng Project:
• SRK considers that major  portions of the Lishan and
Dongfeng are amenable for underground mines.
– IIIA-402 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1228 ---
Criteria JORC Code explanation Commentary
• a cut-off grade of 0.50 % Zn  was used to report the in
situ Mineral Resources for Lishan Mine (below-92m asl)
• a cut-off grade of 0.03 % Mo  was used to report the in
situ Mineral Resources of the Dongfeng Mine (below
250m asl)
Mining
factors or
assumptions
• Assumptions made regarding possible
mining methods, minimum mining
dimensions and internal (or, if
applicable, external) mining dilution. It
is always necessary as part of the
process of determining reasonable
prospects for eventual economic
extraction to consider potential mining
methods, but the assumptions made
regarding mining methods and
parameters when estimating Mineral
Resources may not always be rigorous.
Where this is the case, this should be
reported with an explanation of the
basis of the mining assumptions made.
Jilong and Huatai Projects:
• SRK considers that major  portions of the Jilong and
Huatai are amenable for underground mines.
Wulong Project:
• For steep and thin orebody with solid surrounding wall
rocks, resuing method is adopted to separate the ore
and surrounding rocks, with the ore being transported
and extracted while the waste is kept in the stope for
backfilling.
• For relatively thicker orebody, overhand cut and fill
mining is adopted. Cut and fill mining allows selective
mining, separate recovery of high-grade portions, and
stope retention of low-grade rock. Excavated voids are
backfilled with waste rock once the stope has been
mined out.
• No mining factors have be en applied to the Mineral
Resource.
Jintai Project:
• A conventional open pit minin g methodology is used,
comprising free dig & loading, and haulage by truck.
• No mining factors have be en applied to the Mineral
Resource.
Hanfeng Project:
• SRK considers that major  portions of the Lishan and
Dongfeng are amenable for underground mines.
Metallurgical
factors or
assumptions
• The basis for assumptions or
predictions regarding metallurgical
amenability. It is always necessary as
part of the process of determining
reasonable prospects for eventual
economic extraction to consider
potential metallurgical methods, but the
assumptions regarding metallurgical
treatment processes and parameters
made when reporting Mineral
Resources may not always be rigorous.
Where this is the case, this should be
reported with an explanation of the
basis of the metallurgical assumptions
made.
• All the Projects are in produc tion, metallurgical treatment
processes, metallurgical methods, historical production
performances and laboratory test results are available.
• Metallurgical Test and result s of Jilong Project, Huatai
Project, Wulong Project, Hanfeng Project and Jintai
Project are depicted in section 11.1, 11.2, 11.3, 11.4 and
11.5 respectively.
Environmen-
tal factors or
assumptions
• Assumptions made regarding possible
waste and process residue disposal
options. It is always necessary as part
of the process of determining
reasonable prospects for eventual
economic extraction to consider the
potential environmental impacts of the
mining and processing operation. While
at this stage the determination of
potential environmental impacts,
Jilong Project:
• Three EIA report s have been completed and approved
for the Jilong Project, covering the current main
production facilities, the expanded processing plant and
the new tailings storage facility.
Huatai Project:
• The EIA report for the mining and processing was
prepared and approved in 2007. In addition, SRK has
– IIIA-403 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1229 ---
Criteria JORC Code explanation Commentary
particularly for a greenfields project,
may not always be well advanced, the
status of early consideration of these
potential environmental impacts should
be reported. Where these aspects have
not been considered this should be
reported with an explanation of the
environmental assumptions made.
sighted other six EIA reports and approvals which cover
the whole mining sections.
Wulong Project:
• Two EIA report have been co mpleted and approved for
the Wulong Project, covering the mine site and TSF. The
EIA report for the new processing plant had been
submitted to the environmental protection bureau and
was under review.
Jintai Project:
• The EIA report has been prod uced and approved for the
Jintai Project, covering mining and processing.
Hanfeng Project:
• SRK has sighted four EIA reports prepared for the
Hanfeng Project.
• Considerations of the potent ial environmental impacts
and waste management measures have been stated in
the above EIA reports.
Bulk density • Whether assumed or determined. If
assumed, the basis for the
assumptions. If determined, the method
used, whether wet or dry, the frequency
of the measurements, the nature, size
and representativeness of the samples.
• The bulk density for bulk material must
have been measured by methods that
adequately account for void spaces
(vugs, porosity, etc), moisture and
differences between rock and alteration
zones within the deposit.
• Discuss assumptions for bulk density
estimates used in the evaluation
process of the different materials.
Jilong and Huatai Projects:
• The relationship between SG value and different ore
types and Au grade are analysed by SRK, there is no
obvious correlation was found between SG and grade,
and the average value was used for resource estimation,
see the report for details.
Wulong Project:
• The SG has no significant correlation against the Au
grade.
• For Wulong mine, a total of 88 SG samples were
collected from underground adits during the resource
validation from 2016 to 2019. The SG was set at
2.67g/cm3.
• For Ligunzi deposit, the SG was set at 2.67g/cm3 based
on the data from Wulong mine, the same deposit type.
• For Haojingou-Ligunzi deposit, a total of 48 SG samples
were collected from 12 drillhole and YM307 during the
general exploration from 2012 to 2017. The SG was set
at 2.69g/cm3.
Jintai Project:
• The wax method was us ed for the SG test.
• The samples represented the needs of mineralized body
evaluation.
• The SG values were 2.15g/cm 3 for domain V9 and V10,
2.29g/cm3 for domain V8, and 2.24g/cm3 for domain V4,
V5, V6 and V7.
Hanfeng Project
• the average value of 3.62g/cm 3 was used for resource
estimation of Lishan, and 2.68g/cm3 was applied for
Dongfeng Mine.
Classification • The basis for the classification of the
Mineral Resources into varying
confidence categories.
• Whether appropriate account has been
Jilong and Huatai Projects:
• For all the blocks of the J ilong and Huatai projects,
Resources with a mean sample distance of 40m are
classified as Measured resource; Resources with a
– IIIA-404 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1230 ---
Criteria JORC Code explanation Commentary
taken of all relevant factors (ie relative
confidence in tonnage/grade
estimations, reliability of input data,
confidence in continuity of geology and
metal values, quality, quantity and
distribution of the data).
• Whether the result appropriately
reflects the Competent Person’s view of
the deposit.
mean sample distance of 80m are classified as Indicated
resources; Resources with a mean sample distance of
160m are classified as Inferred resources.
Wulong Project:
• Drillhole spacing distance was used as the basis for
classification.
• SRK considers that blocks es timated with an average
drillhole spacing of less than 40 m can be classified in
the Indicated category within the meaning of the CIM
Definition Standards for Mineral Resources and Mineral
Reserves.
• Blocks excluded by Indicat ed category and within the
mineralized domains should be appropriately classified
in the Inferred category because the confidence in the
estimate is insufficient to allow for the meaningful
application of technical and economic parameters or to
enable an evaluation of economic viability.
Jintai Project:
• The Mineral Resource has been classified as Measured,
Indicated and Inferred based on data spacing and using
a combination of historical knowledge of mining history,
geological and mineralisation continuity, as well as the
drill spacing and geostatistical measures to provide
confidence in the tonnage and grade estimates:
• SRK considers that blocks es timated with an average
drillhole spacing of less than 40 m for both trending and
dip direction can be classified in the Measured category
within the meaning of the CIM Definition Standards for
Mineral Resources and Mineral Reserves.
• SRK considers that estimated  with an average drillhole
spacing of less than 80 m for both trending and dip
direction can be classified in the Indicated category. For
those blocks, SRK considers that the level of confidence
is sufficient to allow appropriate application of technical
and economic parameters to support mine planning and
to allow evaluation of the economic viability of the
deposit. Those blocks can be appropriately classified as
Measured or Indicated.
• blocks excluded by Measur ed and Indicated category
and within the mineralized domains should be
appropriately classified in the Inferred category because
the confidence in the estimate is insufficient to allow for
the meaningful application of technical and economic
parameters or to enable an evaluation of economic
viability.
Hanfeng Project:
• SRK considers geological continuity, sampling interval,
sampling data quality and variation range. Resources
with a mean sample distance of 40m are classified as
Measured resource; Resources with a mean sample
distance of 80m are classified as Indicated resources;
Resources with a mean sample distance of 160m are
classified as Indicated resources for Lishan Mine.
• For the Dongfeng Mo lybdenum Deposit （below 250m
asl）, Resources with a mean sample distance of 50m
are classified as Measured resource; Resources with a
mean sample distance of 100m are classified as
– IIIA-405 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1231 ---
Criteria JORC Code explanation Commentary
Indicated resources; Resources with a mean sample
distance of 200m are classified as Indicated resources
for Dongfeng Mine.
Audits or
reviews
• The results of any audits or reviews of
Mineral Resource estimates.
• Peer reviews of this CPR have been performed by Dr
Yonglian Sun and Mr Pengfei Xiao within SRK internally.
• Dr Yonglian Sun, a Corporat e Consultant (Geotech),
FAusIMM, FIEAust, CPEng
• Mr Pengfei Xiao, a Principal Consultant (Geology) and
MAIG
Discussion of
relative
accuracy/
confidence
• Where appropriate a statement of the
relative accuracy and confidence level
in the Mineral Resource estimate using
an approach or procedure deemed
appropriate by the Competent Person.
For example, the application of
statistical or geostatistical procedures
to quantify the relative accuracy of the
resource within stated confidence limits,
or, if such an approach is not deemed
appropriate, a qualitative discussion of
the factors that could affect the relative
accuracy and confidence of the
estimate.
• The statement should specify whether it
relates to global or local estimates, and,
if local, state the relevant tonnages,
which should be relevant to technical
and economic evaluation.
Documentation should include
assumptions made and the procedures
used.
• These statements of relative accuracy
and confidence of the estimate should
be compared with production data,
where available.
Jilong and Huatai Projects:
• The tonnages and grades  for the Measured and
Indicated Resources are estimated to a certain
acceptable level of confidence, based on the data
density observed by the Competent Person.
• The tonnages and grades for t he Inferred resources are
estimated to a low-level confidence, as sparse data
cannot support a precise estimation of the deposit.
• SRK's resource estimatio n is a global estimate.
Wulong Project:
• The tonnages and grades for  the Indicated Resources
are estimated to a certain acceptable level of
confidence, based on the data density observed by the
Competent Person.
• The tonnages and grades for t he Inferred resources are
estimated to a low-level confidence, as sparse data
cannot support a precise estimation of the deposit.
• SRK's resource estimatio n is a global estimate.
Jintai Project:
• The tonnages and grades  for the Measured and
Indicated Resources are estimated to a certain
acceptable level of confidence, based on the data
density observed by the Competent Person.
• The tonnages and grades for t he Inferred resources are
estimated to a low-level confidence, as sparse data
cannot support a precise estimation of the deposit.
• SRK's resource estimatio n is a global estimate.
Hanfeng Project:
• The tonnages and grades for  the Indicated Resources
are estimated to a certain acceptable level of
confidence, based on the data density observed by the
Competent Person.
• The tonnages and grades for t he Inferred resources are
estimated to a low-level confidence, as sparse data
cannot support a precise estimation of the deposit.
• SRK's resource estimatio n is a global estimate.

Section 4 Estimation and Reporting of Ore Reserves
– IIIA-406 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1232 ---
(Criteria listed in section 1, and where relevant in sections 2 and 3, also apply to this section.)
Criteria JORC Code explanation Commentary
Mineral
Resource
estimate for
conversion to
Ore Reserves
• Description of the Mineral Resource
estimate used as a basis for the
conversion to an Ore Reserve.
• Clear statement as to whether the
Mineral Resources are reported
additional to, or inclusive of, the Ore
Reserves.
Jilong Project:
• Jilong Project has one operating mine named the
Zhuanshanzi Mine and has standalone mine systems
named Zone 1, 2, and 3. The expansion of Zone 4, 5, 6,
and 7 is projected to commence operations in 2027.
• The Ore Reserves estimat e is based on the Mineral
Resource model developed by SRK geologists as of 30
September 2024. Inferred Resources have been
excluded from this estimate.
• The Ore Reserves are reported inclusive of Mineral
Resources.
• The Ore Reserves estimat e is derived from stope
designs and technical and economic feasible checking,
accounting for mining dilution and loss. The reference
point for the Ore Reserves estimates is the Run-of-Mine
(ROM) Pad before the primary crusher and/or stockpiles
at the processing and/or hydrometallurgy plant.
Huaitai Project:
• Huatai Mining has six opera ting mines named #1 Mining
Zone, #26 Vein, #86 Vein, #3&#7 Vein, #5 Mining Zone
and Pengjiagou Mine.
• The Ore Reserves estimat e is based on the Mineral
Resource model developed by SRK geologists as of 30
September 2024. Inferred Resources have been
excluded from this estimate.
• The Ore Reserves are reported inclusive of Mineral
Resources.
• The Ore Reserves estimat e is derived from stope
designs and technical and economic feasible checking,
accounting for mining dilution and loss. The reference
point for the Ore Reserves estimates is the Run-of-Mine
(ROM) Pad before the primary crusher and/or stockpiles
at the processing and/or hydrometallurgy plant.
Wulong Project:
• Wulong Mining has one operating mine named the
Wulong Mine and has three stand-alone underground
operating systems: Zone 2, Zone 3, and Zone 4.
• The Ore Reserves estimat e is based on the Mineral
Resource model developed by SRK geologists as of 30
September 2024. Inferred Resources have been
excluded from this estimate.
• The Ore Reserves are reported inclusive of Mineral
Resources.
• The Ore Reserves estimat e is derived from stope
designs and technical and economic feasible checking,
accounting for mining dilution and loss. The reference
point for the Ore Reserves estimates is the Run-of-Mine
(ROM) Pad before the primary crusher and/or stockpiles
at the processing and/or hydrometallurgy plant.
Jintai Project:
• Jintai Project consists o f one operating mine named
Xidengping Mine with v1 and v2 pit.
• The Ore Reserves estimat e is based on the Mineral
Resource model developed by SRK geologists as of 30
September 2024. Inferred Resources have been
– IIIA-407 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1233 ---
Criteria JORC Code explanation Commentary
excluded from this estimate.
• The Ore Reserves are reported inclusive of Mineral
Resources.
• The Ore Reserves estimat e is derived from pit
optimization and pit design, accounting for mining
dilution and loss. The reference point for the Ore
Reserves estimates is the Run-of-Mine (ROM) Pad
before the primary crusher and/or stockpiles at the
processing and/or hydrometallurgy plant.
Hanfeng Project:
• Hanfeng Project has two mi ning areas named Lishan
and Donfeng. Ore Reserves were estimated in Lishan
Lower Part (Stage 1).
• The Ore Reserves estimat e is based on the Mineral
Resource model developed by SRK geologists as of 30
September 2024. Inferred Resources have been
excluded from this estimate.
• The Ore Reserves are reported inclusive of Mineral
Resources.
The Ore Reserves estimate is  derived from stope designs
and technical and economic feasible checking, accounting for
mining dilution and loss. The reference point for the Ore
Reserves estimates is the Run-of-Mine (ROM) Pad before the
primary crusher and/or stockpiles at the processing plant.
Site visits • Comment on any site visits undertaken
by the Competent Person and the
outcome of those visits.
• If no site visits have been undertaken
indicate why this is the case.
Jilong Project:
• SRK engineers, including specialists in mining,
processing, geology, and environmental disciplines,
visited the site in December 2022.
• SRK engineers, including specialists in mining,
processing, geology, and environmental disciplines,
visited the site in May 2024.
Huatai Project:
• SRK engineers, including specialists in mining,
processing, geology, and environmental disciplines,
visited the site in December 2022.
• SRK engineers, including specialists in mining,
processing, geology, and environmental disciplines,
visited the site in May 2024.
• Huatai Gold Mine suspended its production in 2022, and
had no production in 2023, and the project is under
expansion period, is planning to start its production in
2026.
Wulong Project:
• SRK engineers, including specialists in mining,
processing, geology, and environmental disciplines,
visited the site in December 2022.
• SRK engineers, including specialists in mining,
processing, geology, and environmental disciplines,
visited the site in May 2024.
Jintai Project:
• SRK engineers, including specialists in mining,
processing, geology, and environmental disciplines,
visited the site in March 2023.
• SRK engineers, including specialists in mining,
– IIIA-408 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1234 ---
Criteria JORC Code explanation Commentary
processing, geology, and environmental disciplines,
visited the site in May 2024.
Hanfeng Project:
• SRK engineers, including specialists in mining,
processing, geology, and environmental disciplines,
visited the site in January 2023
• SRK engineers, including specialists in mining,
processing, geology, and environmental disciplines,
visited the site in May 2024.
• Lishan Upper Part and Do ngfeng Upper Part are
currently in production but are not classified as Ore
Reserves. Meanwhile, Lishan Lower Part, which is
classified as Ore Reserves, is under construction with
plans to commence production in 2025.
Study status • The type and level of study undertaken
to enable Mineral Resources to be
converted to Ore Reserves.
• The Code requires that a study to at
least Pre-Feasibility Study level has
been undertaken to convert Mineral
Resources to Ore Reserves. Such
studies will have been carried out and
will have determined a mine plan that is
technically achievable and
economically viable, and that material
Modifying Factors have been
considered.
Jilong: Project
• SRK received following studies (Jilong Studies):
 Zhuanshanzi #1 Mining Z one Preliminary Design
by Chifeng Zhenghang Design Company in
February 2024.
 Zhuanshanzi #2 Mining Z one Preliminary Design
by Chifeng Zhenghang Design Company in
February 2024.
 Zhuanshanzi #3 Mining Z one Preliminary Design
by Chifeng Zhenghang Design Company in
February 2024.
 Zhuanshanzi periphery Mining Zone (#4, #5, #6, #7
Mining Zone) Preliminary Design by Chifeng
Zhenghang Design Company in February 2024.
• Zhuanshanzi Mine currently  has three stand-alone
underground operating systems: Zone 1, Zone 2, and
Zone 3.
• Zhuanshanzi Gold Mine intends to increase its
production capacity by developing peripheral Zone 4, 5,
6, and 7. This expansion is projected to commence
operations in 2027, with an expected production rate of
60 ktpa.
• After reviewing the studies  and operating data, SRK
opines that the project could meet the international Pre-
Feasibility Study (PFS) level in general and could serve
as a basis for Ore Reserves conversion.
• The feasibility study, operat ional data, and production
plan form the basis for Ore Reserves conversion.
Huaitai Project:
• SRK received following studies (Huatai Studies):
 Pengjiagou Preliminary Design by Chifeng Gaoda
Engineering Design Company in May 2018.
 Honghuagou #1 Mining Zone Expansion
Preliminary Design by Inner Mongolia Mining
Industry Development Co., Ltd. in May 2013.
 Lianhuashan #5 Mining Zone Expansion
Preliminary Design by Chifeng Zhenghang Design
Co., Ltd. in November 2022.
 Lianhuashan #26 Vein Preliminary Design by
Chifeng Gaoda Engineering Design Company in
May 2018.
 Lianhuashan #3&#7 Vein Preliminary Design by
Chifeng Zhenghang Design Co., Ltd. in July 2015.
 Lianhuashan #3&#7 Vein Mineral Resources
– IIIA-409 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1235 ---
Criteria JORC Code explanation Commentary
Development and Utilization Scheme by Inner
Mongolia Geology and Mineral Technology Co.,
Ltd. in December 2019.
• Huatai Gold Mine currently s uspended its operation, and
plans its operating systems as follows: Pengjiagou,
Honghuagou #1 Mining Zone, Lianhuashan #5 Mining
Zone, Lianhuashan #26 Vein, Lianhuashan #3-7 Vein.
• After reviewing the studies  and operating data, SRK
opines that the project could meet the international Pre-
Feasibility Study (PFS) level in general and could serve
as a basis for Ore Reserves conversion.
• The feasibility study, operat ional data, and production
plan form the basis for Ore Reserves conversion.
Wulong Project:
• SRK received following studies (Wulong Studies):
 Wulong #2 Mining Zone Preliminary Design by
Shenyang Nonferrous Metallurgy Design and
Research Institute in Feb 2022.
 Wulong #3 Mining Zone Preliminary Design by
Shenyang Nonferrous Metallurgy Design and
Research Institute in Feb 2022.
 Wulong #4 and #5 Mining Zone Preliminary Design
by Shenyang Nonferrous Metallurgy Design and
Research Institute in Feb 2022.
• Wulong Gold Mine currently has three stand-alone
underground operating systems: Zone 2, Zone 3, Zone 4
and Zone 5.
• After reviewing the studies  and operating data, SRK
opines that the project could meet the international Pre-
Feasibility Study (PFS) level in general and could serve
as a basis for Ore Reserves conversion.
• The feasibility study, operat ional data, and production
plan form the basis for Ore Reserves conversion.
Jintai Project:
• Xidengping Gold Mine Preliminary Design by Jinjian
Engineering Design Co., Ltd. in Feb. 2022. (“2022
Preliminary Design”)
• Jintai obtained one mining license and one exploration
license for the Xidengping Mine. Several technical
studies on the mineralized bodies V1 and V2 within the
mining license area have been conducted since the
acquisition of the mining license in 2012. Construction
was initiated at the beginning of 2023. The 2022
Preliminary Design is considered to be at a Pre-
Feasibility Study (PFS) level, providing a reasonable
basis for assessment.
• After reviewing the feasibi lity study and operating data,
SRK opines that the project could meet the international
PFS level in general and could serve as a basis for Ore
Reserves conversion.
• The feasibility study, operat ional data, and production
plan form the basis for Ore Reserves conversion.
Hanfeng Project:
• SRK received following study (Hanfeng Study):
 Lishan Lower Part (Stage1)  Preliminary Design by
Changchun Gold Design Institute in Dec. 2021.
• After reviewing the studies and operating data, SRK
– IIIA-410 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1236 ---
Criteria JORC Code explanation Commentary
opines that the project could meet the international Pre-
Feasibility Study (PFS) level in general and could serve
as a basis for Ore Reserves conversion.
• The feasibility study, operat ional data, and production
plan form the basis for Ore Reserves conversion.
Cut-off
parameters
• The basis of the cut-off grade(s) or
quality parameters applied.
Jilong Project:
• Only one type of ore is extracted from underground for
the treatment flowsheet by Zhuanshanzi Gold Mine.
• The marginal cut-off grade (M COG) is applied for review
the cut-off grades.
 The reference gold metal prices are US$2,050 per
ounce. The price was based on the CMF
(Consensus Market Forecasts) long-term forecast
price.
 The exchange rate is 7.22 RMB/ USD.
 The costs are based on the actual costs from 2021
to 2024 Q3 and adjusted upward with SRK’s
analysis.
 Mining costs are 903 RMB /mined ton.
 Processing costs are 109 RMB /milled ton.
 General and administrat ion costs are 216 RMB
/milled ton.
 The processing recovery is 97%.
 The royalty is 4%.
• The MCOG is estima ted to be 2.76g/t.
• The Ore Reserves were re ported based on the SRK’s
MCOG estimation.
Huatai Project:
• Only one type of ore is extracted from underground for
the treatment flowsheet by Huatai Gold Mine.
• The marginal cut-off grade (M COG) is applied for review
the cut-off grades.
 The reference gold metal prices are US$2,050 per
ounce. The price was based on the CMF
(Consensus Market Forecasts) long-term forecast
price.
 The exchange rate is 7.22 RMB/ USD.
 The costs are based on the actual costs from 2021
to 2022 with SRK’s analysis.
 Mining costs are 840 RMB /mined ton.
 Processing costs are 160 RMB /milled ton.
 General and administrat ion costs are 246 RMB
/milled ton.
 The processing recovery is 93%.
 The royalty is 4%.
• The MCOG is estima ted to be 2.93g/t.
• The Ore Reserves were re ported based on the SRK’s
MCOG estimation.
Wulong Project:
• Only one type of ore is extracted from underground for
the treatment flowsheet by Wulong processing plant.
• The marginal cut-off grade (M COG) is applied for review
the cut-off grades.
 The reference gold metal prices are US$2,050 per
ounce. The price was based on the CMF
(Consensus Market Forecasts) long-term forecast
price.
– IIIA-411 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1237 ---
Criteria JORC Code explanation Commentary
 The exchange rate is 7.22 RMB/ USD.
 The costs are based on the actual costs from 2021
to 2024 Q3 and adjusted upward with SRK’s
analysis.
 Mining costs are 873 RMB /mined ton.
 Processing costs are 89 RMB /milled ton.
 General and administrat ion costs are 57 RMB
/milled ton.
 The processing recovery is 97%.
 The royalty is 4%.
• The MCOG is estimated to be 2.5g/t.
• The Ore Reserves were re ported based on the SRK’s
MCOG estimation.
Jintai Project:
• Only one type of ore is extr acted from the open pit for
the treatment flowsheet by Jintai.
• The marginal cut-off grade (M COG) is applied for review
the cut-off grades.
 The reference gold metal prices are US$2,050 per
ounce. The price was based on the CMF
(Consensus Market Forecasts) long-term forecast
price.
 The costs are based on the actual costs from 2023
to 2024 Q3 with SRK’s analysis.
 The exchange rate is 7.22 RMB/ USD.
 Mining costs are 11 RMB /mined total material
movement.
 Processing costs are 45 RMB /milled ton.
 General and administrat ion costs are 31 RMB
/milled ton.
 The processing recovery is considered the
production data as 78%.
• The MCOG is estimated to be 0.25g/t which differs from
the ore types applied by the 2022 Preliminary Design.
• The Ore Reserves were re ported based on the SRK’s
MCOG estimation.
Hanfeng Project:
• Only one type of ore is extracted from underground for
the treatment flowsheet by Hanfeng Mine.
• The marginal cut-off grade (M COG) is applied for review
the cut-off grades.
 The reference zinc metal  prices are US$2,500 per
ton. The price was based on the CMF (Consensus
Market Forecasts) long-term forecast price.
 The exchange rate is 7.22 RMB/ USD.
 The costs are based on the actual costs from 2020
to 2024 Q3 and adjusted downward with SRK’s
analysis.
 Mining costs are 77 RMB /mined ton.
 Processing costs are 64 RMB /milled ton.
 General and administrat ion costs are 25 RMB
/milled ton.
 The processing recovery is 88%.
 The payable rate is 76%.
• The MCOG is estimated to be 1.42% Zn.
• The Ore Reserves were re ported based on the SRK’s
MCOG estimation.
– IIIA-412 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1238 ---
Criteria JORC Code explanation Commentary
Mining factors
or
assumptions
• The method and assumptions used as
reported in the Pre-Feasibility or
Feasibility Study to convert the Mineral
Resource to an Ore Reserve (i.e. either
by application of appropriate factors by
optimisation or by preliminary or
detailed design).
• The choice, nature and
appropriateness of the selected mining
method(s) and other mining
parameters including associated
design issues such as pre-strip,
access, etc.
• The assumptions made regarding
geotechnical parameters (eg pit slopes,
stope sizes, etc), grade control and
pre-production drilling.
• The major assumptions made and
Mineral Resource model used for pit
and stope optimisation (if appropriate).
• The mining dilution factors used.
• The mining recovery factors used.
• Any minimum mining widths used.
• The manner in which Inferred Mineral
Resources are utilised in mining
studies and the sensitivity of the
outcome to their inclusion.
• The infrastructure requirements of the
selected mining methods.
Jilong Project:
• The stope designs modelled by SRK was used as
the estimation boundary.
• Skin dilution was applie d into the stope shape as
an equivalent linear overbreak slough.
Subsequently, these annealed mineable shapes
were cut using Stope Slicer within GEOVIA Surpac.
Stopes falling outside the design scope or with
irregular shapes were filtered out. A cut-off grade
with gold price of USD 2,050/oz was used to
estimate the in-stope Mineral Reserve. Factors
such as ore loss were factored in using Microsoft
Excel.
• The Zhuanshanzi Mine mai nly adopted the resuing
method since the orebody is very steep and thin
with solid surrounding wall rocks.
• The dilution factor is approximately 16-17%.
• The recovery factor is 95.0%.
• No Inferred Mineral Resources are included in the
Ore Reserves.
• Zhuanshanzi Gold Mine was established in 2005
and has a long operation history, and various
facilities are well developed. A 10kV transmission
line is connected to the power distribution room in
the mining area through LGJ-95mm2 steel-cored
aluminium stranded wires. The power supply meets
production needs. Telephones and mobile
communication are also available.
Huatai Project:
• The stope designs modelled by SRK was used as
the estimation boundary.
• Skin dilution was applie d into the stope shape as
an equivalent linear overbreak slough.
Subsequently, these annealed mineable shapes
were cut using Stope Slicer within GEOVIA Surpac.
Stopes falling outside the design scope or with
irregular shapes were filtered out. A cut-off grade
with gold price of USD 2,050/oz was used to
estimate the in-stope Mineral Reserve. Factors
such as ore loss were factored in using Microsoft
Excel.
• The Huatai mines adopt ed a modified resuing
stoping method, named slice and fill with rock, for
all stopes of mining zones, and planned to use this
method for the rest of Mineral Resources in future.
• The dilution factor is approximately 20.0%.
• The recovery factor is 85.0%.
• No Inferred Mineral Resources are included in the
Ore Reserves.
• Huatai mines were operating previously, and
various facilities are well developed. The power
supply for the Huatai mines’ power supply is
sourced from the Northeast Power Grid, and the
industrial 10kv high-voltage line has been
connected to the mining areas, which can meet
both production needs. Telephones and mobile
communication are also available.
– IIIA-413 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1239 ---
Criteria JORC Code explanation Commentary
Wulong Project:
• The stope designs modelled by SRK was used as
the estimation boundary.
• Skin dilution was applie d into the stope shape as
an equivalent linear overbreak slough.
Subsequently, these annealed mineable shapes
were cut using Stope Slicer within GEOVIA Surpac.
Stopes falling outside the design scope or with
irregular shapes were filtered out. A cut-off grade
with gold price of USD 2,050/oz was used to
estimate the in-stope Mineral Reserve. Factors
such as ore loss were factored in using Microsoft
Excel.
• The Wulong Mine mainly adopted the resuing
method since the orebody is very steep and thin
with solid surrounding wall rocks.
• The dilution factor is approximately 15%.
• The recovery factor is 92%.
• No Inferred Mineral Resources are included in the
Ore Reserves.
• Wulong Mine has a long o peration history since
last century, and various facilities are well
developed. The Northeast Power Grid runs through
the whole area, and the power supply is sufficient.
Telephones and mobile communication are also
available.
Jintai Project:
• The detailed open pit desi gn provided by Jintai was
used as the estimation boundary.
• To develop an optimal  open pit design, an
optimized open pit shell was prepared using the
Lerchs-Grossman 3D algorithm. The pit design was
under the guide of optimization and the design
inputs, then manual modified by engineer. A cut-off
grade with gold price of USD 2,050/oz was used.
• The scoping-level of geotechnical studies were
conducted by Jinjian Engineering Design Co., Ltd.
The overall slope angle used in the design is 10° ~
32° for V1, 11° ~ 22° for V2, and the overall slope
angle is also controlled within 40° for certain areas.
And the open pit slope is safe and reliable.
• The dilution factor is 5%, c onsistent with Jintai's
estimate.
• The recovery factor is 95% , consistent with Jintai's
estimate.
• The minimum mining width is 20 meters.
• No Inferred Mineral Resources are included in the
Ore Reserves.
• Jintai commenced production in 2023, and various
facilities are well developed. The industrial 10kV
high-voltage line has been connected to the
project, approximately 1.8 km away, which can
meet production needs. Telephones and mobile
communication are also available.
Hanfeng Project:
• The stope designs modell ed by SRK were used as
the estimation boundary.
– IIIA-414 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1240 ---
Criteria JORC Code explanation Commentary
• Skin dilution was applie d into the stope shape as
an equivalent linear overbreak slough.
Subsequently, these annealed mineable shapes
were cut using Stope Slicer within GEOVIA Surpac.
Stopes falling outside the design scope or with
irregular shapes were filtered out. Cut-off grade
with zinc price of USD 2,500/t was used to estimate
the in-stope Ore Reserve. Factors such as ore loss
were factored in using Microsoft Excel.
• Hanfeng Study proposed 4 stoping methods that
suit different vein widths:
 Shrinkage delay fill
 Slice & fill
 Resuing
 Sub-level open stope delay fill
• According to the Hanfeng Study, the dilution and
loss are as follows:
 Shrinkage delay fill: 11% dilution, 10% loss
rate
 Slice & fill: 10% dilut ion, 12% loss rate
 Resuing: 17% dilution, 15% loss rate
 Sub-level open stope delay  fill: 10% dilution,
10% loss rate
• The records of Annual Reserves Report 2021
presented the dilution is around 32% and the
mining loss is about 19% in average.
• For dilution, SRK utilized the skin dilution analysis
results, which indicated a rate of 22%.
• The mining loss was assessed at 20%.
• No Inferred Mineral Resources are included in the
Ore Reserves.
• Hanfeng Mine has been in production for many
years, and various facilities are well developed.
There is a 110KV high-voltage dedicated line for
Tianbaoshan operating mine, and the power supply
can fully meet the production needs. Telephones
and mobile communication are also available.
Metallurgical
factors or
assumptions
• The metallurgical process proposed
and the appropriateness of that
process to the style of mineralisation.
• Whether the metallurgical process is
well-tested technology or novel in
nature.
• The nature, amount and
representativeness of metallurgical test
work undertaken, the nature of the
metallurgical domaining applied and
the corresponding metallurgical
recovery factors applied.
• Any assumptions or allowances made
for deleterious elements.
• The existence of any bulk sample or
pilot scale test work and the degree to
which such samples are considered
representative of the orebody as a
whole.
• For minerals that are defined by a
specification, has the ore reserve
estimation been based on the
appropriate mineralogy to meet the
• All the Projects are in produc tion, metallurgical treatment
processes, metallurgical methods, historical production
performances and laboratory test results are available,
providing reliable data of Metallurgical Factors.
• Metallurgical testworks and results ，the metallurgical
process and historical production indexes of Jilong
Project, Huatai Project, Wulong Project, Hanfeng Project
and Jintai Project are depicted in section 11.1, 11.2,
11.3, 11.4 and 11.5, respectively.

– IIIA-415 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1241 ---
Criteria JORC Code explanation Commentary
specifications?
Environmental • The status of studies of potential
environmental impacts of the mining
and processing operation. Details of
waste rock characterisation and the
consideration of potential sites, status
of design options considered and,
where applicable, the status of
approvals for process residue storage
and waste dumps should be reported.
• Jilong Project: SRK noticed  that there are waste rock
dumps in each mining area of the project. The tailings of
the project are dry discharged into the TSF after being
treated in the filter press workshop. The tailings test
results sampled in 2022 show that cyanide in the tailings
meet the requirements of technical specification for
pollution control of cyanide leaching residue in gold
industry (less than 5 mg/L).
• Huatai Project: Waste rock  from the project is mainly
used for underground backfilling or sold for road
building. SRK noticed that there are past-generated
waste dumps at the portal of shafts in each mining area.
The EIA considers the waste rock generated by the
project to be General Industrial Solid Waste Class I.
• Wulong Project: The wast e rocks were temporarily
dumped at the portal of shafts in each mining area.
Liaoning Wulong stated that the waste rock from the
project is mainly used for underground backfilling or sold
for construction. The tailings of the project are dry
discharged into the TSF after being treated in the filter
press workshop.
• Jintai Project: The EIA report states that the heap
leaching residue is hazardous waste. The project's heap
leaching residue is to be disposed of in situ and
impermeable measures will be adopted to prevent
leakage.
• Hanfeng Project: The waste rocks from the project were
temporarily dumped near the portal of shaft in the mining
area and processing plant. Jilin Hanfeng stated that the
waste rock is mainly used for underground backfilling.
The EIA concluded that the waste rock from the project
was not classified as hazardous waste.
Infrastructure • The existence of appropriate
infrastructure: availability of land for
plant development, power, water,
transportation (particularly for bulk
commodities), labour, accommodation;
or the ease with which the
infrastructure can be provided, or
accessed.
Jilong, Huatai, Wulong, Jintai, and Hanfeng Projects:
The operation is established, and all required infrastructure is
in place.
Costs • The derivation of, or assumptions
made, regarding projected capital costs
in the study.
• The methodology used to estimate
operating costs.
• Allowances made for the content of
deleterious elements.
• The source of exchange rates used in
the study.
• Derivation of transportation charges.
• The basis for forecasting or source of
treatment and refining charges,
penalties for failure to meet
specification, etc.
• The allowances made for royalties
payable, both Government and private.
Jilong:
• Capital costs:
 Expansion for Zone 5, 6, 7: RMB137.8 mln.
 Expansion for deeper part in Zone 1, 2, and 3:
RMB58.8 mln.
 Sustaining Capital: RMB298 mln. (SRK used
the unit cost of approximately 324 RMB per
milled ton, as the forecasted sustaining unit
cost for the LOM.
 SRK assumed that worki ng capital is 30% of
the operating expenses in 2024 and would be
fully recovered at the end of the LOM.
 Mine closure fees have been considered in the
economic projection, and no residual value
would be considered.
• Operating costs were categ orized into the following
components: labor, material, electricity, contractors,
engineering, service, safety, repairment, others, taxes
– IIIA-416 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1242 ---
Criteria JORC Code explanation Commentary
and surcharges, selling costs, G&A costs, R&D cost.
• No metallurgical allowances have been made for the
effect of deleterious elements since none have been
detected.
• The treatment and refining cha rge have been included in
the processing costs.
• Income tax is 15%.
Huatai:
• Capital costs:
 Expansion: RMB239 mln.
 Sustaining Capital: R MB274 mln. SRK used
the unit cost from 2020, approximately 162
RMB per milled ton, as the forecasted
sustaining unit cost for the LOM.
 SRK assumed that worki ng capital is 30% of
the operating expenses in 2026 and would be
fully recovered at the end of the LoM.
 Mine closure fees have been considered in the
economic projection, and no residual value
would be considered.
• Operating costs were categ orized into the following
components: labor, material, electricity, contractors,
engineering, service, safety, repairment, others, taxes
and surcharges, selling costs, G&A costs, R&D cost.
• No metallurgical allowances have been made for the
effect of deleterious elements since none have been
detected.
• The treatment and refining cha rge have been included in
the processing costs.
• Income tax is 25%.
Wulong:
• Capital costs:
 Sustaining capital: RMB503 mln. SRK used
the averaged unit cost, approximately 511
RMB/milled ton, as the forecasted sustaining
unit cost for the LOM.
 SRK assumed that worki ng capital is 30% of
the operating expenses in 2024 and would be
fully recovered at the end of the LoM.
 Mine closure fees have been considered in the
economic projection, and no residual value
would be considered.
• Operating costs were categ orized into the following
components: labor, material, electricity, contractors,
engineering, service, safety, repairment, others, taxes
and surcharges, selling costs, G&A costs, R&D cost.
• No metallurgical allowances have been made for the
effect of deleterious elements since none have been
detected.
• The treatment and refining cha rge have been included in
the processing costs.
• Income tax is 15%.
Jintai:
• Capital costs:
 Sustaining Capital: R MB33 mln. SRK used the
averaged unit cost, approximately 24
RMB/milled ton, as the forecasted sustaining
– IIIA-417 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1243 ---
Criteria JORC Code explanation Commentary
unit cost for the LOM.
 SRK assumed that worki ng capital is 30% of
the operating expenses in 2024 and would be
fully recovered at the end of the LoM.
 Mine closure fees have been considered in the
economic projection, and no residual value
would be considered.
• Operating costs were categ orized into the following
components: labor, material, electricity, contractors,
engineering, service, safety, repairment, others, taxes
and surcharges, selling costs, G&A costs, R&D cost.
• No metallurgical allowances have been made for the
effect of deleterious elements since none have been
detected.
• Transportation charges have been included in the
administration costs.
• The treatment and refining cha rge have been included in
the processing costs.
• Income tax is 25%.
Hanfeng:
• Capital costs:
 Expansion: RMB 109 mln.
 Sustaining Capital: RMB266 mln.  SRK used
the averaged unit cost, approximately 80
RMB/milled ton, as the forecasted sustaining
unit cost for the LOM.
 SRK assumed that worki ng capital is 30% of
the operating expenses in 2025 and would be
fully recovered at the end of the LoM.
 Mine closure fees have been considered in the
economic projection, and no residual value
would be considered.
• Operating costs were categ orized into the following
components: labor, material, electricity, contractors,
engineering, service, safety, repairment, others, taxes
and surcharges, selling costs, G&A costs, R&D cost.
• No metallurgical allowances have been made for the
effect of deleterious elements since none have been
detected.
• The refining charge to zinc price is 24%.
• Income tax is 25%.
Revenue
factors
• The derivation of, or assumptions
made regarding revenue factors
including head grade, metal or
commodity price(s) exchange rates,
transportation and treatment charges,
penalties, net smelter returns, etc.
• The derivation of assumptions made of
metal or commodity price(s), for the
principal metals, minerals and co-
products.
Jilong Project:
• For economic analysis, gol d metal price was dynamic
and was derived from consensus market forecasts
provided by the Energy and Metals Consensus Forecast,
published by Consensus Economics Inc., to which SRK
subscribes annually.
• There is no other revenue factor considered.
Huatai Project:
• For economic analysis, gol d metal price was dynamic
and was derived from consensus market forecasts
provided by the Energy and Metals Consensus Forecast,
published by Consensus Economics Inc., to which SRK
subscribes annually.
• There is no other revenue factor considered.
Wulong Project:
– IIIA-418 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1244 ---
Criteria JORC Code explanation Commentary
• For economic analysis, gol d metal price was dynamic
and was derived from consensus market forecasts
provided by the Energy and Metals Consensus Forecast,
published by Consensus Economics Inc., to which SRK
subscribes annually.
• A 92.0% payable rate is considered due to the final
product.
Jintai Project:
• For economic analysis, gol d metal price was dynamic
and was derived from consensus market forecasts
provided by the Energy and Metals Consensus Forecast,
published by Consensus Economics Inc., to which SRK
subscribes annually.
• A 97.0% payable rate is considered due to the final
product
Hanfeng Project:
• For economic analysis, zin c metal price was dynamic
and was derived from consensus market forecasts
provided by the Energy and Metals Consensus Forecast,
published by Consensus Economics Inc., to which SRK
subscribes annually.
• A 76% payable rate is c onsidered due to the final
product
Market
assessment
• The demand, supply and stock
situation for the particular commodity,
consumption trends and factors likely
to affect supply and demand into the
future.
• A customer and competitor analysis
along with the identification of likely
market windows for the product.
• Price and volume forecasts and the
basis for these forecasts.
• For industrial minerals the customer
specification, testing and acceptance
requirements prior to a supply contract.
• See Sections 15.1 and 15.2.
• No special market assessment was conducted. The
Chifeng Gold’s five projects are all operating projects,
and for example, the Jilong, Huatai, Wulong and
Hanfeng projects have been in production for many
years and the Jintai Project started operation in the first
quarter of 2024. They have built and maintained a good
relationship between the mines and the market.
Economic • The inputs to the economic analysis to
produce the net present value (NPV) in
the study, the source and confidence of
these economic inputs including
estimated inflation, discount rate, etc.
• NPV ranges and sensitivity to
variations in the significant
assumptions and inputs.
Jilong Project:
• The discount rate used for N PV calculation ranges from
5% to 15%, with increments of 1%. All results indicate a
positive NPV.
• The Capex, Opex, along with gold prices, were selected
as the essential variable factors affecting cash flow.
These essential factors were analysed within a ±30%
range for their impact on NPV, using a 10% discount
rate.
• The NPV is most sensitive to  changes in the gold price.
However, even when the gold price decreases by 30%,
the Jilong Project remains economical.
Huatai Project:
• The discount rate used for N PV calculation ranges from
5% to 15%, with increments of 1%. All results indicate a
positive NPV.
• The Capex, Opex, along with gold prices, were selected
as the essential variable factors affecting cash flow.
These essential factors were analysed within a ±30%
– IIIA-419 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1245 ---
Criteria JORC Code explanation Commentary
range for their impact on NPV, using a 10% discount
rate.
• The NPV is most sensitive to  changes in the gold price.
However, a decrease in the gold price by approximately
30% would render the Huatai Project uneconomical.
Wulong Project:
• The discount rate used for N PV calculation ranges from
5% to 15%, with increments of 1%. All results indicate a
positive NPV.
• The Capex, Opex, along with gold prices, were selected
as the essential variable factors affecting cash flow.
These essential factors were analysed within a ±30%
range for their impact on NPV, using a 10% discount
rate.
• The NPV is most sensitive to  changes in the gold price.
However, even when the gold price decreases by 30%,
the Wulong Project remains economical.
Jintai Project:
• The discount rate used for N PV calculation ranges from
5% to 15%, with increments of 1%. All results indicate a
positive NPV.
• The Capex, Opex, along with gold prices, were selected
as the essential variable factors affecting cash flow.
These essential factors were analysed within a ±30%
range for their impact on NPV, using a 10% discount
rate.
• The NPV is most sensitive to  changes in the gold price.
However, even when the gold price decreases by 30%,
the Jintai Project remains economical.
Hanfeng Project:
• The discount rate used for N PV calculation ranges from
5% to 15%, with increments of 1%. All results indicate a
positive NPV.
• The Capex, Opex, along with zi nc prices, were selected
as the essential variable factors affecting cash flow.
These essential factors were analysed within a ±30.%
range for their impact on NPV, using a 10% discount
rate.
• The NPV is most sensitive to changes in the zinc price
and Opex. A decrease in the zinc price by approximately
10%, or an increase in Opex by approximately 10%,
would render the Hanfeng Project uneconomical.
Social • The status of agreements with key
stakeholders and matters leading to
social licence to operate.
• Jilong Project: The public participation surveys of the
EIA reports show that there were no objections to the
project development.
• Huatai Project: The EIA reports, which include detailed
results of public participation, show that the majority of
the public supports the project's operation, with no
objections raised.
• Wulong: Project The public participation surveys of the
EIA reports show that there were no objections to the
project development.
• Jintai Project: The public participation survey results
shown 98.5% personal support for the project and 100%
group support.
• Hanfeng Project:The public participation surveys of the
– IIIA-420 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1246 ---
Criteria JORC Code explanation Commentary
EIA reports show that there were no objections to the
project development.
Other • To the extent relevant, the impact of
the following on the project and/or on
the estimation and classification of the
Ore Reserves:
• Any identified material naturally
occurring risks.
• The status of material legal
agreements and marketing
arrangements.
• The status of governmental
agreements and approvals critical to
the viability of the project, such as
mineral tenement status, and
government and statutory approvals.
There must be reasonable grounds to
expect that all necessary Government
approvals will be received within the
timeframes anticipated in the Pre-
Feasibility or Feasibility study. Highlight
and discuss the materiality of any
unresolved matter that is dependent on
a third party on which extraction of the
reserve is contingent.
Jilong Project:
• There is no material risk for operation.
• Risk assessment for Jilong Pr oject is included in this
CPR.
• The project is located within  the current mining licenses,
for current and expansion operations which are valid
until 29 September 2026 and 27 March 2032,
respectively. The end of LoM is in 2032, it is believed
that there is no reason to expect that Zhuanshanzi Mine
will be unable to renew its license.
Huatai Project:
• There are two material risks for operation:
“underestimated the operating cost” and “the project’s
economic feasibility”.
• Risk assessment for Huatai Project is included in this
CPR.
• The project holds several m ining licenses based on the
individual operating systems, most of which will expire in
2024 or 2025. The end of the LoM is projected to be in
2053. It is believed that there is no reason to expect that
the Huatai Gold Mine will encounter any challenges in
renewing its licenses.
Wulong Project:
• There is no material risk for operation.
• Risk assessment for Wulong Pr oject is included in this
CPR.
• The project is located within  the current mining licenses,
which are valid until 4 August 2035. The end of the LoM
is projected to be in 2035. It is believed that there is no
reason to expect that Wulong Gold Mine will encounter
any challenges in renewing its license.
Jintai Project:
• There is no material risk for operation.
• Risk assessment for Jintai P roject is included in this
CPR.
• The project is located within  the current mining license,
which is valid until 6 June 2032. Although this date is
earlier than the end of LoM in 2035, it is believed that
there is no reason to expect that Jintai will be unable to
renew its license.
Hanfeng Project:
• There are one material risks for operation: “the project’s
economic feasibility”.
• Risk assessment for Hanfeng Project is included in this
CPR.
• The project holds two mi ning licenses based on
individual operating systems. The license for the Lishan
Lower Part is set to expire on 27 August 2050. The end
of the LoM is projected to be in 2032.
Classification • The basis for the classification of the
Ore Reserves into varying confidence
categories.
Jilong, Huatai, Wulong Jintai, Hanfeng Projects:
• Measured Mineral Resource s in the mine designs are
– IIIA-421 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1247 ---
Criteria JORC Code explanation Commentary
• Whether the result appropriately
reflects the Competent Person’s view
of the deposit.
• The proportion of Probable Ore
Reserves that have been derived from
Measured Mineral Resources (if any).
classified as Proved Ore Reserves. Indicated Mineral
Resources in the mine designs are classified as
Probable Ore Reserves.
• The classification of Ore Rese rves appropriately reflects
the Competent Person’s view of the deposits.
• There is no Measured Mineral  Resources are classified
as Probable Ore Reserves.
Audits or
reviews
• The results of any audits or reviews of
Ore Reserve estimates.
Jilong, Huatai, Wulong Jintai, Hanfeng Projects:
• The Ore Reserves estimates have been peer reviewed
internally and is in line with current industry standards.
Discussion of
relative
accuracy/
confidence
• Where appropriate a statement of the
relative accuracy and confidence level
in the Ore Reserve estimate using an
approach or procedure deemed
appropriate by the Competent Person.
For example, the application of
statistical or geostatistical procedures
to quantify the relative accuracy of the
reserve within stated confidence limits,
or, if such an approach is not deemed
appropriate, a qualitative discussion of
the factors which could affect the
relative accuracy and confidence of the
estimate.
• The statement should specify whether
it relates to global or local estimates,
and, if local, state the relevant
tonnages, which should be relevant to
technical and economic evaluation.
Documentation should include
assumptions made and the procedures
used.
• Accuracy and confidence discussions
should extend to specific discussions of
any applied Modifying Factors that may
have a material impact on Ore Reserve
viability, or for which there are
remaining areas of uncertainty at the
current study stage.
• It is recognised that this may not be
possible or appropriate in all
circumstances. These statements of
relative accuracy and confidence of the
estimate should be compared with
production data, where available.
Jilong Project:
• The Ore Reserves estimat es are based on Jilong
Studies and ongoing operations. The Ore Reserves
estimates are at a PFS level.
• All modifying factors have been applied for Ore
Reserves estimates on a global estimate.
Huatai Project:
• The Ore Reserves estimat es are based on Huatai
Studies and historical operations. The Ore Reserves
estimates are at a PFS level.
• All modifying factors have been applied for Ore
Reserves estimates on a global estimate.
Wulong Project:
• The Ore Reserves estimat es are based on Wulong
Studies and ongoing operations. The Ore Reserves
estimates are at a PFS level.
• All modifying factors have been applied for Ore
Reserves estimates on a global estimate.
Jintai Project:
• The Ore Reserves estimates are based on 2022
Preliminary Design and ongoing operations. The Ore
Reserves estimates are at a PFS level.
• All modifying factors have been applied for Ore
Reserves estimates on a global estimate.
Hanfeng Project:
• The Ore Reserves estimat es are based on Hanfeng
Studies and historical operations. The Ore Reserves
estimates are at a PFS level.
• All modifying factors have been applied for Ore
Reserves estimates on a global estimate.



– IIIA-422 –
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FOR THE PRC MINES


--- page 1248 ---
Appendix B Compliance with Chapter 18
– IIIA-423 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1249 ---
Chapter 18
18.01 DEFINITIONS AND INTERPRETATION
18.02-
18.04 CONDITIONS FOR LISTING OF NEW APPLICANT MINERAL COMPANIES  ]
18.02 In addition to satisfying  the requirements of Chapter 8, a Mineral Company which has
 applied for listing must also satisfy the requirements of this  Chapter.
18.03 A Mineral Company must:—
 (1) establish to the Exchange’s satisfaction that it has the r ight to participate actively in
CPR Executive Summary and
Section 3.2[1]
  the exploration for and/or ext raction of Natural Resources, either:—
  (a)
through control over a majority (by value) of the assets in which it has
invested
   together with adequate rights over the exploration for and/o r extraction of
   Natural Resources; or
   Note: ‘control over a majority’ means an interest greater than 50%.
  (b) through adequate rights (arising under arrangements accep table to the
   Exchange), which give it suffi cient influence in decisions over the exploration
   for and/or extraction of the Natural Resources;
 (2) establish to the Exchange’s satisfaction that it has at le ast a portfolio of:—
CPR Executive Summary and
Section 8.10
  (a) Indicated Resources; or
  (b) Contingent Resources,

identifiable under a Reporting Standard and substantiated in a Competent
Person’s

Report. This portfolio must be meaningful and of sufficient substance to justify
a listing;
 (3) if it has commenced producti on, provide an estimate of cash operating costs
CPR Executive Summary and
Section14
  including the costs associated with:—
  (a) workforce employment;
  (b) consumables;
  (c) fuel, electricity, water and other services;
  (d) on and off-site administration;
  (e) environmental protection and monitoring;
  (f) transportation of workforce;
  (g) product marketing and transport;
  (h) non-income taxes, royalti es and other governmental charges; and
  (i) contingency allowances;

Not
e:  A Mineral Company must:
   • set out the components of cash operating costs separately by category;
   • explain the reason for any departur e from the list of items to be included
   under cash operating costs; and
   • discuss any material cost items that should be highlighted to investors.
 (4) demonstrate to the Exchange’s satisfaction that it has available working capital for
CPR Section 15 only for
reference
  125% of the group’s present requirements, that is for at leas t the next 12 months,
  which must include:—
  (a) general, administrative and operating costs;
  (b) property holding costs; and
  (c) the cost of any proposed exploration and/or development; and

Not
e: Capital expenditures do not need to be included in working capital
– IIIA-424 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1250 ---
Chapter 18
   requirements. Where they are financ ed out of borrowings, relevant interest
   and loan repayments must be included.
 (5) ensure that its working capi tal statement in the listing document under Listing
CPR Section 15 only for
reference
  Rule 8.21A states it has ava ilable sufficient working capital for 125% of the group’s
  present requirements, that is  for at least 12 months from the date of its listing
  document.
18.04 If a Mineral Company is unabl e to satisfy either the profit test in rule 8.05(1), the market
 capitalisation/revenue/cash flow test in rule 8.05(2), or the market capitalisation/revenue
 test in rule 8.05(3), it may st ill apply to be listed if it can establish to the Exchange’s
 satisfaction that its directors and senior managers, taken tog ether, have sufficient
 experience relevant to the expl oration and/or extraction activity that the Mineral Company
 is pursuing. Individuals relied on must have a minimum of five years relevant industry

experience. Details of the relevant experience must be disclosed in the listing document
of
 the new applicant.

Note
:  A Mineral Company relying on this rule mu st demonstrate that its primary activity is
  the exploration for and/or ex traction of Natural Resources.
18.05-
18.08 CONTENTS OF LISTING DOCUMENTS FOR NEW APPLICANTS
18.05 In addition to the information set out in Appendix 1A, a Mineral Company must include in
 its listing document:—
 (1) a Competent Person’s Report;
CPR Executive Summary,
Section 1 and Section 2.2
 (2) a statement that no materi al changes have occurred since the effective date of CPR Section 2.4
  the Competent Person’s Report. Where there are material chang es, these must be
  prominently disclosed;
 (3) the nature and extent of its prospecting, exploration, expl oitation, land use and
CPR Section 3.2 and Section
13.4
  mining rights and a description of the properties to which th ose rights attach,
  including the duration and othe r principal terms and conditions of the concessions
  and any necessary licences and consents. Details of material rights to be obtained
  must also be disclosed;
 (4) a statement of any legal cla ims or proceedings that may have an influence on its CPR Section 2.3
  rights to explore or mine;
 (5) disclosure of specific risks and general risks. Companies should have regard to
CPR Executive Summary and
Section 16
  Guidance Note 7 on suggested risk analysis; and
 (6) if relevant and material to t he Mineral Company’s business operations, information
  on the following:—
  (a) project risks arising from  environmental, social, and health and safety issues;
CPR Executive Summary and
Section 16
  (b) any non-governmental or ganisation impact on sustainability of mineral and/or  CPR Section 2.3
   exploration projects;
  (c) compliance with host count ry laws, regulations and permits, and payments CPR Sections 13.2, 13.3
   made to host country governm ents in respect of tax, royalties and other
   significant payments on a country by country basis;
  (d)
sufficient funding plans for remediation, rehabilitation and, closure and
removal CPR Section 13.7
   of facilities in a sustainable manner;
  (e) environmental liabilities o f its projects or properties; CPR Section 13.5
– IIIA-425 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1251 ---
Chapter 18
  (f) its historical experienc e of dealing with host country laws and practices, CPR Section 13.8
   including management of differences between national and local practice;
  (g) its historical experienc e of dealing with concerns of local governments and Not applicable. Section 2.3
   communities on the sites of its mines, exploration propertie s, and relevant
   management arrangements; and
  (h) any claims that may exist over the land on which explorat ion or mining activity CPR Section 13.4
   is being carried out, including any ancestral or native claims.
18.06-
18.08
Additional disclosure requirements that apply to certain new applicant Mineral
Companies
18.06 If a Mineral Company has  begun production, it must disclose an estimate of the operating CPR Section 14
 cash cost per appropriate unit for the minerals and/or Petroleum produced.
18.07 If a Mineral Company has not yet begun production, it mus t disclose its plans to proceed Not applicable [2]

to production with indicative dates and costs. These plans must be supported by at least
a

Scoping Study, substantiated by the opinion of a Competent Person. If exploration rights
or
 rights to extract Resources and/or Reserves have not yet been obtained, relevant risks to
 obtaining these rights must be prominently disclosed.
18.08 If a Mineral Company is involved in the exploration for or extraction of Resources, it m ust CPR Section 10.8 and Section 9
 prominently disclose to investors that its Resources may not ultimately be extracted at a
  profit.
18.09-
18.13 RELEVANT NOTIFIABLE TRANSACTIONS INVOLVING THE ACQUISITIO N
 OR DISPOSAL OF MINERAL OR PETROLEUM ASSETS
18.09 A Mineral Company proposi ng to acquire or dispose of assets which are solely or mainly
 Mineral or Petroleum Assets as part of a Relevant Notifiable Transaction must:—
 (1) comply with Chapter 14 and Chapter 14A, if relevant;
 (2)
produce a Competent Person’s Report, which must form part of the relevant
circular,
  on the Resources and/or Reserves being acquired or disposed o f as part of the
  Relevant Notifiable Transaction;

Not
e:  The Exchange may dispense with the requirement for a Competent Person’s
    Report on disposals where sharehol ders have sufficient information on the
    assets being disposed of.
 (3)
in the case of a major (or above) acquisition, produce a Valuation Report, which
must

form part of the relevant circular, on the Mineral or Petroleum Assets being
acquired
  as part of the Relevant Not ifiable Transaction; and
 (4) comply with the requirements of rules 18.05(2) to 18.05(6)  in respect of the assets
  being acquired.

Note
:  Material liabilities that remain with t he issuer on a disposal must also be discussed.
18.10-
18.11 Requirements that apply to listed issuers
18.10
A listed issuer proposing to acquire assets which are solely or mainly Mineral or
Petroleum
 Assets as part of a Relevant Notifiable Transaction must comply with rule 18.09.
18.11 On completion of a Relevan t Notifiable Transaction involving the acquisition of Mineral or
 Petroleum Assets, unless the Exchange decides otherwise, a listed issuer will be treated
 as a Mineral Company.
– IIIA-426 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1252 ---
Chapter 18
18.12-
18.13 Requirements that apply to Mineral Companies and listed issuers
18.12 The Exchange may dispense wi th the requirement to produce a new Competent Person’s
 Report or a Valuation Report under rules 18.05(1), 18.09(2) or  18.09(3), if the issuer
 has available a previously publ ished Competent Person’s Report or Valuation Report (or
 equivalent) which complies with rules 18.18 to 18.34 (where ap plicable), provided the
 report is no more than six months  old. The issuer must provide this document and a no
 material change statement in t he listing document or circular for the Relevant Notifiable
 Transaction.
18.13 An issuer must obtain the prior written consent of a Competent Person(s) or Competent
 Evaluator for their material to be included in the form and co ntext in which it appears in
 a listing document or circular fo r the Relevant Notifiable Transaction, whether or not such
 person or firm is retained by the listing applicant or the iss uer.
18.14-
18.17 CONTINUING OBLIGATIONS
18.14 Disclosure in reports
18.14 A Mineral Company must incl ude in its interim (half-yearly) and annual reports details
 of its exploration, developmen t and mining production activities and a summary of
 expenditure incurred on these ac tivities during the period under review. If there has been
 no exploration, development or production activity, that fact must be stated.
18.15-
18.17 Publication of Resources and Reserves
18.15 A listed issuer that public ly discloses details of Resources and/or Reserves must give an

update of those Resources and/or Reserves once a year in its annual report, in
accordance
 with the reporting standard under which they were previously d isclosed or a Reporting
 Standard.
18.16
A Mineral Company must include an update of its Resources and/or Reserves in its
annual
 report in accordance with the Reporting Standard under which t hey were previously
 disclosed.
18.17 Annual updates of Resources an d/or Reserves must comply with rule 18.18.

Note
: Annual updates are not required to be s upported by a Competent Person’s Report
  and may take the form of a no material change statement.
18.18-
18.27 STATEMENTS ON RESOURCES AND/OR RESERVES
18.18 Presentation of data
18.18 Any data presented on Resources and/or Reserves by a Mine ral Company in a listing
CPR Executive Summary,
Section 8.10 and Section 9
 document, Competent Person’s Report, Valuation Report or annual report, must be
 presented in tables in a manner readily understandable to a no n-technical person. All
 assumptions must be clearly dis closed and statements should include an estimate of
 volume, tonnage and grades.
18.19 Basis of evidence
18.19 All statements referring to Resources and/or Reserves:—
 (1) in any new applicant listing document or circular relating to a Relevant Notifiable

Transaction, must be substantiated in a Competent Person’s Report which must
form part of the document; and
 (2) in all other cases, must a t least be substantiated by the issuer’s internal experts.
18.20 Petroleum Competent Persons’ Reports Not applicable.
– IIIA-427 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1253 ---
Chapter 18
18.20
A Competent Person’s Report for Mineral Companies involved in the exploration for
and/or
 extraction of Petroleum Resour ces and Reserves must include the information set out in
 Appendix 25.
18.21-
18.22 Competent Person
18.21 A Competent Person must:—
 (1) have a minimum of five years experience relevant to the style of mineralization CPR Section 2.7
  and type of deposit under consi deration or to the type of Petroleum exploration,
  reserve estimate (as appropri ate), and to the activity which the Mineral Company is
  undertaking;
 (2) be professionally qualified, and be a member in good standi ng of a relevant CPR Section 2.7
  Recognised Professional Organisa tion, in a jurisdiction where, in the Exchange’s
  opinion, the statutory securiti es regulator has satisfactory arrangements (either by
  way of the IOSCO Multilateral MOU or other bi-lateral agreement acceptable to the
  Exchange) with the Commission for mutual assistance and excha nge of information
  for enforcing and securing compliance with the laws and regul ations of that
  jurisdiction and Hong Kong; and
 (3) take overall responsibility for the Competent Person’s Repo rt. CPR Sections 2.7 and 2.9
18.22
A Competent Person must be independent of the issuer, its directors, senior
management CPR Section 2.7 and 2.10
 and advisers. Specifically the Co mpetent Person retained must:—
 (1) have no economic or beneficia l interest (present or contingent) in any of the assets
  being reported on;
 (2)
not be remunerated with a fee dependent on the findings of the Competent
Person’s
  Report;
 (3) in the case of an individual, not be an officer, employee or proposed officer of the
  issuer or any group, holding or associated company of the issuer; and
 (4) in the case of a firm, not be a group, holding or associat ed company of the issuer.
  Any of the firm’s partners or  officers must not be officers or proposed officers of any
  group, holding or associated company of the issuer.
18.23 Additional requirements of Competent Evaluators
18.23
In addition to the requirements set out in rules 18.21(2) and 18.22, a Competent
Evaluator
 must:—
 (1) have at least ten years rele vant and recent general mining or Petroleum experience
  (as appropriate);
 (2) have at least five years rele vant and recent experience in the assessment and/or
  valuation of Mineral or Petroleum Assets or securities (as appropriate); and
 (3) hold all necessary licences.

Note
:  A Competent Person’s Report or Valuation Report may be performed by the same
  Competent Person provided he or s he is also a Competent Evaluator.
18.24 Scope of Competent Persons’ Reports and Valuation Reports
18.24
A Competent Person’s Report or Valuation Report must comply with a Reporting
Standard
 as modified by this Chapter, and must:—
 (1) be addressed to the Mineral Company or listed issuer;
CPR Executive Summary,
Section 1 and Section 2.2
 (2) have an effective date (being the date when the contents o f the Competent CPR Section 2.4
– IIIA-428 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1254 ---
Chapter 18
  Person’s Report or Valuation Report are valid) less than six months before the
  date of publishing the listing document or circular relating to a Relevant Notifiable
  Transaction required under the Listing Rules; and
 (3) set out what Reporting Standard has been used in preparing the Competent
Executive Summary, Section 1
and Section 2.2
  Person’s Report or Valuation Report, and explain any departure from the relevant
  Reporting Standard.
18.25-
18.26 Disclaimers and Indemnities
18.25 A Competent Person’s Report or Valuation Report may conta in disclaimers of sections C PR Section 2.11 and 2.12
 or topics outside their scope of e xpertise in which the Competent Person or Competent
 Evaluator relied upon other ex perts’ opinions, but must not contain any disclaimers of the
 report in its entirety.
18.26 The Competent Person or Competent Evaluator must prominen tly disclose in the CPR Section 2.11 and 2.12
 Competent Person’s Report or Valuation Report the nature and d etails of all indemnities
 provided by the issuer. Indemniti es for reliance placed on information provided by issuers
 and third party experts (for information outside the Competent  Person’s or Competent

Evaluator’s expertise) are generally acceptable. Indemnities for fraud and gross
negligence
 are generally unacceptable.
18.27 Obligations of sponsor
CPR Section 2.6, 2.7, 2.9 and
2.10
18.27
Any sponsor appointed to or by a new applicant Mineral Company under Chapter 3A
must
 ensure that any Competent Person or Competent Evaluator meets the requirements of
 this Chapter.
18.28-
18.34 REPORTING STANDARD
18.28-
18.30 Mineral reporting standard
18.28 In addition to satisfying  the requirements of Chapter 13 (as modified by this Chapter), a
 Mineral Company exploring for and/or extracting mineral Resources and Reserves must
 also satisfy rules 18.29 and 18.30.
18.29 A Mineral Company must di sclose information on mineral Resources, Reserves and/or
CPR Executive Summary,
Section 1, Section 8.10 and
Section 9
 exploration results either:—
 (1) under:
  (a) the JORC Code;
  (b) NI 43-101; or
  (c) the SAMREC Code,
  as modified by this Chapter; or
 (2) under other codes acceptable  to the Exchange as communicated to the market
  from time to time, provided t he Exchange is satisfied that they give a comparable
  standard of disclosure and sufficient assessment of the under lying assets.

Note
:  The Exchange may allow presentation of Reserves under other reporting standards
  provided reconciliation to a Reporting Standard is provided. A Reporting Standard
  applied to specific assets  must be used consistently.
18.30 A Mineral Company must ensure that:—
 (1)
any estimates of mineral Reserves disclosed are supported, at a minimum, by a
Prefeasibility Study; CPR Section 9
– IIIA-429 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1255 ---
Chapter 18
 (2) estimates of mineral Reser ves and mineral Resources are disclosed separately; CPR Section 8.10 and Section 9
 (3) Indicated Resources and Measured Resources are only includ ed in economic CPR Section 15
  analyses if the basis on which  they are considered to be economically extractable
  is explained and they are appropriately discounted for the pr obabilities of their
  conversion to mineral Reserve s. All assumptions must be clearly disclosed.
  Valuations for Inferred Resources are not permitted;
 (4) for commodity prices used in Pre-feasibility Studies, Feas ibility Studies and
  valuations of Indicated Resources, Measured Resources and Res erves:—
  (a) the methods to determine those commodity prices, all mate rial assumptions
CPR Section 8.10, Section 9 and
Section 15
   and the basis on which those prices represent reasonable views of future
   prices are explained clearly; and
  (b)  if a contract for future prices of mineral Reserves exis ts, the contract price is CPR Section 9 and Section 15
   used; and
 (5)
for forecast valuations of Reserves and profit forecasts, sensitivity analyses to
higher
  and lower prices are supplied . All assumptions must be clearly disclosed.
18.31-
18.33 Petroleum reporting standard Not applicable.
18.31 In addition to satisfying  the requirements of Chapter 13 (as modified by this Chapter), a

Mineral Company exploring for and/or extracting Petroleum Resources and Reserves
must
 also satisfy rules 18.32 and 18.33.
18.32 A Mineral Company must di sclose information on Petroleum Resources and Reserves
 either:—
 (1) under PRMS as modified by this Chapter; or
 (2) under other codes acceptable to the Exchange if it is sati sfied that they give a
  comparable standard of discl osure and sufficient assessment of the underlying
  assets.

Note
:  A Reporting Standard applied to specif ic assets must be used consistently.
18.33 A Mineral Company must ensure that:—
 (1) where estimates of Reserves are disclosed, the method and reason for choice of
  estimation are disclosed (i.e . deterministic or probabilistic methods, as defined in
  PRMS). Where the probabilistic method is used, the underlying confidence levels
  applied must be stated;
 (2)
if the NPVs attributable to Proved Reserves and Proved plus Probable Reserves
are

disclosed, they are presented on a post-tax basis at varying discount rates
(including
  a reflection of the weighted av erage cost of capital or minimum acceptable rate of
  return that applies to the entity at the time of evaluation) or a fixed discount rate of
  10%;
 (3) Proved Reserves and Proved plus Probable Reserves are anal ysed separately and

principal assumptions (including prices, costs, exchange rates and effective date)
and
  the basis of the methodology  are clearly stated;
 (4) if the NPVs attributable to  Reserves are disclosed, they are presented using a
  forecast price as a base case or using a constant price as a base case. The bases
  for the forecast case must be disclosed. The constant price is defined as the
  unweighted arithmetic average of the closing price on the first day of each month
– IIIA-430 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1256 ---
Chapter 18
  within the 12 months before the end of the reporting period, unless prices are
  defined by contractual arrangemen ts. The basis on which the forecast price is

considered reasonable must be disclosed and Mineral Companies must comply
with
  rule 18.30;

Not
e:  In the forecast case under PRMS , the economic evaluation underlying the
   investment decision is based on the entity’s reasonable forecast of future
   conditions, including costs and prices, which will exist during the life of the
   project.
 (5) if estimated volumes of Contingent Resources or Prospectiv e Resources are
  disclosed, relevant risk fa ctors are clearly stated;

Not
e: Under PRMS, wherever the volume of a Contingent Resource is stated,
   risk is expressed as the chance t hat the accumulation will be commercially
   developed and graduate to the reserves class. Wherever the volume of a

Prospective Resource is stated, risk is expressed as the chance that a
potential
   accumulation will result in a significant discovery of Petroleum.
 (6) economic values are not att ached to Possible Reserves, Contingent Resources or
  Prospective Resources; and
 (7) where an estimate of future net revenue is disclosed, whether calculated without
  discount or using a discount rate, it is prominently disclose d that the estimated
  values disclosed do not rep resent fair market value.
18.34 Mineral or Petroleum Asset Valuation Reports Not applicable.
18.34 A Mineral Company must ensure that:—
 (1) any valuation of its Miner al or Petroleum Assets is prepared under the VALMIN
  Code, SAMVAL Code, CIMVAL or such other code approved by the Exchange from
  time to time;
 (2) the Competent Evaluator s tates clearly the basis of valuation, relevant assumptions

and the reason why a particular method of valuation is considered most
appropriate,
  having regard to the nature of the valuation and the developm ent status of the
  Mineral or Petroleum Asset;
 (3) if more than one valuation method is used and different va luations result, the
  Competent Evaluator comments on how the valuations compare an d on the reason
  for selecting the value adopted; and
 (4)
in preparing any valuation a Competent Evaluator meets the requirements set out
in
  rule 18.23.
Notes:
1. CPR is the Competent Pers on’s Report prepared by SRK.
2. China Project is a producing project.

– IIIA-431 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1257 ---
Appendix C Chapter 2.6 of the Guide for New Listing
Applicants
– IIIA-432 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1258 ---
Chapter 2.6
Section in SRK’s
Report
(i)
The cut-off grade (which should be an industry standard commonly used),
minimum mining width, economic parameters (e.g. waste to ore ratio, stope
productivity), specific gravity derivation, prevailing commodity price
assumptions;
Section 8.10 and
Section 9
(ii)
If the Competent Person has a different view on certain assumptions (e.g.
processing recovery rate) made by the applicant, both views should be
disclosed in the listing document, with differences highlighted and underlying
reasons for the different views, and the impact on the applicant if the more
conservative view is adopted;
Section 9
(iii
)
Detailed analysis for harmful elements identified at mines (e.g. mercury or
arsenic at lead and zinc mines) to give a better picture of whether there are
material concentrations of these elements within particular lodes, and the
impact on the saleability of the minerals;
Section 9
(iv
)
Clear and meaningful drawings and diagrams, shown to scale, of the location
of the applicant’s principal Mineral or Petroleum Assets;
Section 3
(v)
The procedures, amount of testing, assessment and time required to ascertain
the amount of Reserves, and the existing Reserves of the mine over its entire
mine life, expected average Resource and Reserve grades of ore that can be
extracted in future years (preferably covering the whole economic life of the
mine), depletion charges and hedging activities;
Section 9 and
Section 10
(vi
)
Whether the historical or expected improved recovery rate is used for
estimating the net present value (“NPV”), and the basis on which the discount
rates are considered appropriate;
Section 15
(vi
i)
If the Competent Person did not conduct a site visit, the applicant should
disclose in the “Business” section of the listing document the basis on which
the Reserves/Resources, cost forecasts and other data relating to the mines/
oilfields as disclosed in the CPR are arrived at, how the lack of a site visit would affect the reliability of the
information, and an appropriate risk factor 3; and
Section 7
(vi
ii)
All material risks mentioned in the CPR should be disclosed in the “Risk
Factors” section of the listing document.
Section 16


– IIIA-433 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1259 ---
Assay Results for Verification Samples Collected on the Jilong Project.
Ore Sample No. Sample Type
Original Check Sample SGS Intertek
Au g/t No. Au (g/t) Au (g/t)
黄金洞竖井三中段(561m)ZC6 Channel 17.23 ZS001 24.8 15.92
黄金洞竖井三中段(561m)ZC7 Channel 3.37 ZS002 3.14 3
黄金洞竖井三中段(561m)ZC8 Channel 9.78 ZS003 34.9 9.15
黄金洞竖井三中段(561m)ZC9 Channel 20.68 ZS004 16.6 27.59
黄金洞盲竖井一中段(481m)ZC6 Channel 20.41 ZS005 27 20.78
黄金洞盲竖井一中段(481m)ZC7 Channel 45.07 ZS006 62.6 50.42
黄金洞盲竖井一中段(481m)ZC8 Channel 38.09 ZS007 60.8 42.72
黄金洞盲竖井一中段(481m)ZC9 Channel 3.97 ZS008 3.6 3.75
黄金洞盲竖井二中段(442m)ZC5 Channel 15.23 ZS009 28.5 27.19
黄金洞盲竖井二中段(442m)ZC6 Channel 36.41 ZS010 79.9 57.56
黄金洞盲竖井二中段(442m)ZC7 Channel 9.96 ZS011 23.2 16.46
黄金洞盲竖井二中段(442m)ZC8 Channel 6.43 ZS012 10.8 6.99
黄金洞盲竖井二中段(442m)ZC9 Channel 18.23 ZS013 21.9 16.74
黄金洞竖井三中段(561m)ZC40 Channel 6.49 ZS014 6.6 8.72
黄金洞竖井三中段(561m)ZC41 Channel 11.25 ZS015 7.46 8
黄金洞竖井三中段(561m)ZC42 Channel 8.67 ZS016 12.6 18.94
黄金洞竖井三中段(561m)ZC43 Channel 10.28 ZS017 13.9 11.56
黄金洞竖井三中段(561m)ZC44 Channel 9.95 ZS018 27.3 17.64
黄金洞盲竖井一中段(481m)ZC26 Channel 6.43 ZS019 14.6 8.54
黄金洞盲竖井一中段(481m)ZC27 Channel 12.78 ZS020 24.6 11.79
黄金洞盲竖井一中段(481m)ZC28 Channel 7.63 ZS021 47.1 16.8
黄金洞盲竖井一中段(481m)ZC29 Channel 25.63 ZS022 59.2 16.8
黄金洞盲竖井二中段(442m)ZC56 Channel 7.21 ZS023 12 33.14
黄金洞盲竖井二中段(442m)ZC57 Channel 13.71 ZS024 19.2 6.18
黄金洞盲竖井二中段(442m)ZC58 Channel 5.26 ZS025 6.76 12.18
黄金洞盲竖井二中段(442m)ZC59 Channel 20.11 ZS026 19.8 20.81
黄金洞盲竖井二中段(442m)ZC60 Channel 39.57 ZS027 39.4 36.25
落凤毛竖井二中段(621m)ZC5 Channel 12.15 ZS028 22.1 11.78
落凤毛竖井二中段(621m)ZC6 Channel 20.71 ZS029 12.3 24.2
落凤毛竖井二中段(621m)ZC7 Channel 31.47 ZS030 38.8 34.47
落凤毛竖井二中段(621m)ZC8 Channel 26.12 ZS031 35.1 40.32
落凤毛竖井二中段(621m)ZC9 Channel 7.23 ZS032 5.1 5.6
落凤毛竖井二中段(621m)ZC10 Channel 10.54 ZS033 18.8 10.9
落凤毛竖井二中段(621m)ZC11 Channel 8.97 ZS034 7.83 2.99
落凤毛竖井四中段(523m)ZC26 Channel 15.55 ZS035 28.2 3.91
Appendix D Assay Results
– IIIA-434 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1260 ---
Ore Sample No. Sample Type
Original Check Sample SGS Intertek
Au g/t No. Au (g/t) Au (g/t)
落凤毛竖井四中段(523m)ZC27 Channel 6.92 ZS036 21.9 10.46
落凤毛竖井四中段(523m)ZC28 Channel 6.51 ZS037 9.13 9.03
落凤毛竖井四中段(523m)ZC29 Channel 8.48 ZS038 8.29 6.64
落凤毛竖井四中段(523m)ZC30 Channel 14.81 ZS039 33 11.56
落凤毛竖井四中段(523m)ZC31 Channel 8.99 ZS040 3.44 3.97
落凤毛竖井四中段(523m)ZC32 Channel 9.51 ZS041 13.6 16
落凤毛竖井四中段(523m)ZC33 Channel 11.25 ZS042 14.9 12.36
落凤毛竖井三中段(563m)ZC36 Channel 4.23 ZS043 2.22 1.76
落凤毛竖井三中段(563m)ZC37 Channel 10.11 ZS044 23.6 15.97
落凤毛竖井三中段(563m)ZC38 Channel 27.54 ZS045 5.49 15.32
落凤毛竖井三中段(563m)ZC39 Channel 7.14 ZS046 9.21 7.24
落凤毛竖井三中段(563m)ZC40 Channel 19.22 ZS047 41.1 23.68
落凤毛竖井三中段(563m)ZC41 Channel 9.02 ZS048 9.27 11.36
落凤毛竖井四中段(523m)ZC34 Channel 10.35 ZS049 29.9 13.52
落凤毛竖井四中段(523m)ZC35 Channel 1.95 ZS050 1.23 1.64
落凤毛竖井四中段(523m)ZC36 Channel 1.28 ZS051 0.66 0.86
落凤毛竖井四中段(523m)ZC37 Channel 1.74 ZS052 0.81 1.15
落凤毛竖井四中段(523m)ZC38 Channel 1.56 ZS053 1.47 1.88
落凤毛竖井四中段(523m)ZC39 Channel 9.87 ZS054 10.5 10.67
阳坡盲竖井一中段(264m)ZC39 Channel 1.49 ZS055 3.42 1.83
阳坡盲竖井一中段(264m)ZC40 Channel 1.86 ZS056 2.52 3.17
阳坡盲竖井一中段(264m)ZC41 Channel 1.89 ZS057 5.19 1.53
阳坡盲竖井一中段(264m)ZC42 Channel 1.73 ZS058 0.33 1.78
阳坡盲竖井一中段(264m)ZC43 Channel 1.74 ZS059 1.34 2.01
阳坡竖井八中段(303m)ZC13 Channel 16.73 ZS060 16.8 21.13
阳坡竖井八中段(303m)ZC14 Channel 22.22 ZS061 44 25.88
阳坡竖井八中段(303m)ZC15 Channel 27.69 ZS062 62.5 27.4
阳坡竖井八中段(303m)ZC16 Channel 21.51 ZS063 40 22.49
阳坡竖井八中段(303m)ZC17 Channel 17.16 ZS064 27.6 15.54
阳坡竖井八中段(303m)ZC18 Channel 14.22 ZS065 20.8 17.59
阳坡盲竖井一中段(264m)ZC31 Channel 4.01 ZS066 3.63 3.51
阳坡盲竖井一中段(264m)ZC32 Channel 9.75 ZS067 22.4 8.82
阳坡盲竖井一中段(264m)ZC33 Channel 4.08 ZS068 8.97 4.17
阳坡盲竖井一中段(264m)ZC34 Channel 8.62 ZS069 25.1 10.36
27号盲竖井一中段(303m)ZC31 Channel 9.89 ZS070 17.9 11.01
27号盲竖井一中段(303m)ZC32 Channel 14.36 ZS071 20.9 11.3
27号盲竖井一中段(303m)ZC33 Channel 8.86 ZS072 10.3 8.66
27号盲竖井一中段(303m)ZC34 Channel 9.04 ZS073 2.31 5.71
27号盲竖井一中段(303m)ZC35 Channel 14.36 ZS074 19.6 15.65
27号盲竖井四中段(147m)ZC74 Channel 2.43 ZS075 1.02 1
27号盲竖井四中段(147m)ZC75 Channel 1.87 ZS076 2.58 2.36
27号盲竖井五中段(102m)CM1 Channel 15.56 ZS077 37 17.65
27号盲竖井五中段(102m)CM2 Channel 15.06 ZS078 40.2 31.73
27号盲竖井五中段(102m)CM2 Channel 18.43 ZS079 28.4 18.6
ZK10-05 Drill Core 10.02 ZS080 28.6 9.86
ZK10-05 Drill Core 9.79 ZS081 11.8 12.61
ZK10-05 Drill Core 11.23 ZS082 8.76 9.84
ZK10-13 Drill Core 8.25 ZS083 17.9 10.25
ZK10-13 Drill Core 7.86 ZS084 14.9 10.55
ZK10-13 Drill Core 9.93 ZS085 7.8 9.54
27号竖井五中段(510m)ZC11 Channel 26.33 ZS086 67.2 29.98
27号竖井五中段(510m)ZC13 Channel 17.24 ZS087 27.4 16.26
27号竖井五中段(510m)ZC15 Channel 15.67 ZS088 18.4 15.38
– IIIA-435 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1261 ---
Ore Sample No. Sample Type
Original Check Sample SGS Intertek
Au g/t No. Au (g/t) Au (g/t)
27号竖井五中段(510m)ZC17 Channel 32.11 ZS089 54.6 51.75
28号盲竖井一中段(476m)ZC5 Channel 32.98 ZS090 47.6 33.98
28号盲竖井一中段(476m)ZC7 Channel 19 ZS091 44.6 27.53
28号盲竖井一中段(476m)ZC9 Channel 16.985 ZS092 23.2 16.66
28号盲竖井一中段(476m)ZC11 Channel 29.48 ZS093 64.4 33.57
28号盲竖井一中段(476m)ZC13 Channel 35.04 ZS094 73.8 45.81
28号盲竖井一中段(476m)ZC15 Channel 30.52 ZS095 44 43.63
28号盲竖井一中段(476m)ZC31 Channel 49.16 ZS096 55.6 55.61
28号盲竖井一中段(476m)ZC33 Channel 25.83 ZS097 8.7 17.94
28号盲竖井一中段(476m)ZC35 Channel 6.82 ZS098 37.8 8.51
28号盲竖井一中段(476m)ZC1 Channel 4.97 ZS099 12.8 4.63
28号盲竖井一中段(476m)ZC3 Channel 12.27 ZS100 31.8 10.21
28号盲竖井一中段(476m)ZC5 Channel 30.28 ZS101 40 27.05
28号盲竖井一中段(476m)ZC7 Channel 26.19 ZS102 25.9 24.53
28号盲竖井四中段(358m)ZC37 Channel 17.43 ZS103 138 69.62
28号盲竖井四中段(358m)ZC39 Channel 21.71 ZS104 33.2 22.63
28号盲竖井四中段(358m)ZC41 Channel 3.64 ZS105 3.06 2.48
28号盲竖井四中段(358m)ZC43 Channel 2.76 ZS106 10.6 5.24
28号盲竖井四中段(358m)ZC2 Channel 23.21 ZS107 22.9 23.41
28号盲竖井四中段(358m)ZC4 Channel 42.25 ZS108 54.7 38.19
28号盲竖井六中段(277m)ZC23 Channel 18.81 ZS109 75.4 22.5
28号盲竖井六中段(277m)ZC25 Channel 17.03 ZS110 41.4 17.8
28号盲竖井六中段(277m)ZC27 Channel 4.36 ZS111 7.32 5.32
28号盲竖井六中段(277m)ZC29 Channel 38.16 ZS112 78.6 40.63
28号盲竖井六中段(277m)ZC31 Channel 19.31 ZS113 29.5 28.12
28号盲竖井六中段(277m)ZC33 Channel 14.99 ZS114 35 15.85
28号盲竖井七中段(237m)ZC31 Channel 26.27 ZS115 45.9 34.29
28号盲竖井七中段(237m)ZC33 Channel 12.95 ZS116 14.1 15.05
28号盲竖井七中段(237m)ZC35 Channel 22.18 ZS117 29.2 37.91
28号盲竖井七中段(237m)ZC37 Channel 9.42 ZS118 8.25 9.19
28号盲竖井七中段(237m)ZC39 Channel 22.27 ZS119 61 41.43
28号盲竖井七中段(237m)ZC21 Channel 7.3 ZS120 17.7 16.01
28号盲竖井七中段(237m)ZC23 Channel 49.305 ZS121 109 51.23
28号盲竖井七中段(237m)ZC25 Channel 17.75 ZS122 24.9 20.06
28号盲竖井七中段(237m)ZC27 Channel 5.26 ZS123 8.13 8.96
落凤毛竖井三中段(563m)ZC108 Channel 11.825 ZS124 16.4 19.83
落凤毛竖井三中段(563m)ZC2 Channel 22.56 ZS125 188 172.5
落凤毛竖井三中段(563m)ZC4 Channel 5.97 ZS126 14.6 7.67
落凤毛竖井三中段(563m)ZC6 Channel 30.05 ZS127 57.7 44.76
落凤毛竖井三中段(563m)ZC3 Channel 2.94 ZS128 12.2 5.22
落凤毛竖井三中段(563m)ZC5 Channel 23.55 ZS129 51 26.71
落凤毛竖井三中段(563m)ZC7 Channel 27.77 ZS130 99.8 43.28
落凤毛竖井三中段(563m)ZC9 Channel 31.62 ZS131 41.8 30.11
落凤毛竖井三中段(563m)ZC11 Channel 1.33 ZS132 3.7 2.94
72号盲竖井一中段(309m)ZC33 Channel 10.77 ZS133 15 11.97
72号盲竖井一中段(309m)ZC35 Channel 6.48 ZS134 9.34 10.09
72号盲竖井一中段(309m)ZC37 Channel 9.27 ZS135 24.4 17.67
72号盲竖井一中段(309m)ZC39 Channel 37.78 ZS136 58.9 43.86
72号盲竖井一中段(309m)ZC41 Channel 8.26 ZS137 16.5 12.53
72号盲竖井一中段(309m)ZC2 Channel 19.53 ZS138 81.1 31.49
白金线盲竖井七中段(391m)南 ZC27 Channel 105.19 ZS139 112 119
白金线盲竖井七中段(391m)南 ZC29 Channel 67.57 ZS140 110 72.6
白金线盲竖井七中段(391m)南 ZC31 Channel 17.73 ZS141 32.2 18.12
– IIIA-436 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1262 ---
Ore Sample No. Sample Type
Original Check Sample SGS Intertek
Au g/t No. Au (g/t) Au (g/t)
白金线盲竖井七中段(391m)南 ZC33 Channel 12.43 ZS142 25.2 11.66
白金线盲竖井七中段(391m)南 ZC35 Channel 14.85 ZS143 14.3 20.44
阳坡竖井六中段(387m)ZC34 Channel 18.98 ZS144 23.2 14.72
阳坡竖井六中段(387m)ZC36 Channel 14.88 ZS145 30.5 11.27
阳坡竖井六中段(387m)ZC38 Channel 8.5 ZS146 13.4 9.23
阳坡竖井六中段(387m)ZC40 Channel 5.575 ZS147 11.9 10.54
阳坡竖井六中段(387m)ZC42 Channel 2.03 ZS148 2.72 1.41
阳坡盲竖井十中段(-122m)ZC17 Channel 8.56 ZS149 14.9 6.55
阳坡盲竖井十中段(-122m)ZC19 Channel 9.25 ZS150 17.3 9.92
阳坡盲竖井十中段(-122m)ZC21 Channel 22.3 ZS151 35.5 22.87
阳坡盲竖井十中段(-122m)ZC23 Channel 37.65 ZS152 61.3 52.79
阳坡盲竖井十中段(-122m)ZC2 Channel 7.37 ZS153 19 24.3
阳坡盲竖井十中段(-122m)ZC4 Channel 5.33 ZS154 3.96 3.86
Assay Results for Verification Samples Collected on the Huatai Project.
Ore Sample
No Sample Type Original Check Sample
No.
Check Check
Au g/t Au g/t Au g/t
YM1-ZM1-2 Channel 6.95 HT01 7.86 6.55
YM1-ZM3-4 Channel 7.01 HT02 9.51 8.23
YM1-ZM5-6 Channel 8.11 HT03 10.7 17.71
YM1-ZM7-8 Channel 9.02 HT04 5.46 10.47
YM1-ZM9-10 Channel 6.55 HT05 8.19 6.87
YM1-ZM11-12 Channel 5.88 HT06 8.64 7.53
YM1-ZM13-14 Channel 6.32 HT07 7.41 6.29
YM2-ZM2-2 Channel 7.55 HT08 11.3 9.38
YM2-ZM2-3 Channel 5.95 HT09 7.53 8.71
YM2-ZM4-5 Channel 6.45 HT10 9.6 7.71
YM2-ZM6-7 Channel 9.32 HT11 13.8 10.12
YM2-ZM8-9 Channel 4.63 HT12 5.31 4.71
YM1-ZM21-22 Channel 3.32 HT13 3.12 3.37
YM1-ZM21-23 Channel 9.79 HT14 9.15 8.21
YM1-ZM25-25 Channel 4.91 HT15 5.82 4.96
YM2-ZM1-1 Channel 1.44 HT16 2.22 1.42
YM2-ZM3-3 Channel 15.01 HT17 13.6 8.24
YM2-ZM5-5 Channel 10.14 HT18 9.42 7.92
YM1-ZM3H5 Channel 3.22 HT19 3.57 2.89
YM1-ZM4H7 Channel 6.31 HT20 8.97 8.22
YM1-ZM5H9 Channel 7.61 HT21 11.3 9.86
YM1-ZM6H11 Channel 6.98 HT22 7.77 6.32
YM1-ZM7H13 Channel 4.06 HT23 4.53 3.97
YM1-ZM8H15 Channel 9.14 HT24 7.95 7.78
CK110HC2213 Drill Core 22.05 HT25 25.5 23.11
CK110HC2214 Drill Core 18.74 HT26 23.4 20.33
CK110HC2215 Drill Core 27.12 HT27 26.4 33.1
CK110HC2216 Drill Core 19.58 HT28 23.7 22.97
CK44ZA1941 Drill Core 5.83 HT29 6 6.18
CK90HC2016 Drill Core 1.35 HT30 1.92 1.12
632m中段 CM8H2 Channel 9.88 HT31 13 10.28
632m中段 CM8H3 Channel 12.38 HT32 14.8 13.67
591m中段 CM0H2 Channel 11.46 HT33 13.5 12.09
– IIIA-437 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1263 ---
Ore Sample
No Sample Type Original Check Sample
No.
Check Check
Au g/t Au g/t Au g/t
591m 中段 CM0H3 Channel 12.34 HT34 11.7 11.15
591m 中段 CM2H2 Channel 9.46 HT35 10.8 9.95
591m 中段 CM2H3 Channel 8.43 HT36 15.2 15.36
591m 中段 CM6H2 Channel 8.95 HT37 8.07 7.56
CM2-1H2 Drill Core 4.68 HT38 6.81 5.44
CM0H2 Drill Core 5.24 HT39 5.46 5.43
CM1H2 Drill Core 5.62 HT40 6.15 5.94
CM2-2H2 Drill Core 5.87 HT41 6.96 6.28
CM2-2H3 Drill Core 6.33 HT42 7.44 7.84
CM5AH2 Drill Core 4.01 HT43 4.59 3.96
CM7H2 Drill Core 3.76 HT44 4.56 3.15
CM9H2 Drill Core 3.06 HT45 3.18 2.41
CM9-1H3 Drill Core 4.09 HT46 5.76 3.58
KZK1951H4 Drill Core 3.63 HT47 4.14 3.07
KZK1952H2 Drill Core 5.03 HT48 7.89 6.53
KZK197A2H2 Drill Core 4.58 HT49 5.16 3.63
KZK197A2H3 Drill Core 4.77 HT50 6.24 5.49
Assay Results for Verification Samples Collected on the Huatai Project.
Hole_id Check sample No. Original
Au(g/t)
SGS
Au(g/t)
4708YM3M21 LHS01 3.37 3.53
3818-2YM2N59 LHS02 4.12 4.68
4708YM3M18 LHS03 4.33 5.68
TC33N12 LHS04 4.91 4.19
4708-2YM2N74 LHS05 5.31 4.91
5148-2YM1N23 LHS06 5.62 6.75
3818-2YM2N55 LHS07 6.13 6.72
5148-2YM1N14 LHS08 6.36 8.82
4258-2YM2N57 LHS09 6.9 7.79
4258-2YM1N19 LHS10 7.18 0.80
KZK702 LHS11 7.52 7.08
4258YM3M5 LHS12 7.96 11.2
4258-2YM1N14 LHS13 8.21 7.40
4258YM4M23 LHS14 8.42 12.4
6398YM4N27 LHS15 8.76 9.41
ZK901 LHS16 9.12 9.90
5598YM3N23 LHS17 9.33 10.4
5998-2YM1M22 LHS18 9.57 10.9
5998-2YM1M16 LHS19 9.89 8.92
5148-2YM1N18 LHS20 10.2 10.8
ZK1004 LHS21 10.35 10.1
ZK903 LHS22 10.67 12.8
4258-2YM2N71 LHS23 11.15 12.3
4258-2YM1N11 LHS24 11.34 15.5
ZK1205 LHS25 12.36 14.3
4258YM4M26 LHS26 13.03 13.4
– IIIA-438 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1264 ---
Hole_id Check sample No. Original
Au(g/t)
SGS
Au(g/t)
4708-2YM1N44 LHS27 14.2 17.1
5598-2YM2M25 LHS28 15.27 21.1
5998-2YM1M8 LHS29 16.59 26.7
3818-2YM2N50 LHS30 18.56 20.7
5998-2YM1M24 LHS31 21.05 38.2
5598YM3N25 LHS32 25.61 4.66
5598YM3N9 LHS33 40.21 53.4
14551-10YM3-11 LHS40 3.23 4.78
10551-10YM3-11 LHS41 3.45 3.23
10551-10YM3-9 LHS42 3.88 4.03
10551-10YM3-26 LHS43 4.13 4.75
6551-10CM1-1-H2 LHS44 4.33 3.37
10551-10YM3-20 LHS45 4.63 5.93
6551-10YM3-H19 LHS46 5.01 5.83
KZK197A3 LHS47 5.23 2.93
6551-10YM3-H10 LHS48 5.45 4.44
24951-1CM2-1 LHS49 5.78 5.50
6551-10CM1-H2 LHS50 6.11 8.62
33751-1CM12 LHS51 6.32 3.92
6451CM5 LHS52 6.62 7.14
45851-1CM1 LHS53 7.01 17.4
50051-1CM3 LHS54 7.28 10.0
53551-9YM2-CM8 LHS55 8.21 8.72
50051-8CM1 LHS56 9.03 10.2
41651-1CM11 LHS57 9.64 15.9
50051-9YM2-CM7 LHS58 9.98 19.8
50051-9YM2-CM2 LHS59 10.36 40.3
53551-9YM2-CM10 LHS60 11.34 12.9
53551-8CM9 LHS61 13.07 0.19
Assay Results for Verification Samples Collected on the Wulong Project (Wulong Mine)
Ore Sample
Sample Type
Original Check Sample Check
No. Au g/t No. Au g/t
14163 沿（十四中段）7 Channel 1 WL01 1.11
14163 沿（十四中段）8 Channel 7.6 WL02 7.2
14163 沿（十四中段）9 Channel 1.3 WL03 1.44
14163 沿（十四中段）10 Channel 2.17 WL04 1.41
14163 沿（十四中段）11 Channel 3.74 WL05 4.11
1911 沿(十九中段）23 Channel 15 WL06 17.8
1911 沿(十九中段）24 Channel 3.6 WL07 15.7
1911 沿(十九中段）25 Channel 6.6 WL08 7.64
18 中水平（十八中段）38 Channel 14.7 WL09 14.9
18 中水平（十八中段）39A Channel 15 WL10 17
18 中水平（十八中段）39B Channel 5.5 WL11 5.49
ZK1816346 Drill Core 2.8 WL12 18.5
– IIIA-439 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1265 ---
Ore Sample
Sample Type
Original Check Sample Check
No. Au g/t No. Au g/t
ZK1816347 Drill Core 12.7 WL13 13
ZK1816348 Drill Core 3.4 WL14 3.87
ZK19111H1 Drill Core 10.7 WL15 11.5
ZK19111H3 Drill Core 1.66 WL16 1.86
ZK19112H1 Drill Core 4.4 WL17 4.11
ZK19112H2 Drill Core 3.33 WL18 3.57
十八中段 4KH273 Channel 17.54 WL19 19.9
十八中段 4KH274 Channel 19.99 WL20 21.5
十八中段 4KH275 Channel 4.52 WL21 0.5
十八中段 4KH276 Channel 2.82 WL22 1.65
十八中段 4KH277 Channel 4.13 WL23 4.71
十九中段 4KH455 Channel 7.47 WL24 7.23
十九中段 4KH456 Channel 12.87 WL25 13.6
十九中段 4KH457 Channel 7.69 WL26 8.73
十九中段 4KH458 Channel 4.59 WL27 4.38
十九中段 4KH459 Channel 3.53 WL28 4.89
十九中段 4KH460 Channel 8.53 WL29 9.06
二十中段 9HF028 Channel 1.2 WL30 1.35
二十中段 9HF031 Channel 1.2 WL31 2.28
二十中段 9HF036 Channel 1.45 WL32 0.27
二十中段 9HF037 Channel 1.3 WL33 1.59
二十中段 9HF040 Channel 1.5 WL34 1.86
二十中段 9HF041 Channel 1.1 WL35 1.22
ZK1816346 Drill Core 2.8 WL36 2.37
ZK1816347 Drill Core 12.7 WL37 14.2
ZK1816348 Drill Core 3.4 WL38 4.02
ZK19111H1 Drill Core 10.7 WL39 12.6
ZK19111H3 Drill Core 1.66 WL40 1.8
ZK19112H1 Drill Core 4.4 WL41 4.38
ZK19112H2 Drill Core 3.33 WL42 3.45
十八中段 4KH335 Channel 12.9 WL43 14.5
十八中段 4KH336 Channel 2.34 WL44 2.42
十九中段 4KH340 Channel 15.3 WL45 16.8
十九中段 4KH341 Channel 3.39 WL46 3.42
十九中段 4KH342 Channel 3.89 WL47 3.65
十九中段 4KH343 Channel 4.18 WL48 3.99
十九中段 4KH461 Channel 4.34 WL49 4.13
十九中段 4KH462 Channel 5.45 WL50 5.67
十九中段 4KH463 Channel 4.7 WL51 4.96
二十中段 H71 Channel 15.64 WL52 17.7
二十中段 H72 Channel 15.02 WL53 16.4
二十中段 H73 Channel 17.91 WL54 19.9
二十中段 H74 Channel 5.69 WL55 6.36
– IIIA-440 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1266 ---
Ore Sample
Sample Type
Original Check Sample Check
No. Au g/t No. Au g/t
1523 沿（十五中段）10 Channel 4.2 WL56 4.59
1523 沿（十五中段）11 Channel 1.3 WL57 2.19
1723 沿（十七中段右端）1 Channel 10.6 WL58 9.4
1723 沿（十七中段右端）2 Channel 17.8 WL59 19.1
1723 沿（十七中段右端）3 Channel 5.9 WL60 5.56
1723 沿（十七中段右端）4 Channel 20 WL61 21
ZK182329 Drill Core 4.3 WL62 4.73
ZK1823210 Drill Core 1.6 WL63 1.94
ZK182331 Drill Core 14.06 WL64 15.1
ZK182332 Drill Core 1.3 WL65 1.97
ZK182333 Drill Core 2.1 WL66 1.95
ZK182341 Drill Core 8.7 WL67 8.18
ZK182342 Drill Core 13.2 WL68 14
ZK182343 Drill Core 9.7 WL69 8.72
ZK182344 Drill Core 3.4 WL70 3.76
十四中段 3KH96 Channel 3.11 WL71 2.96
十四中段 3KH97 Channel 3.65 WL72 3.7
十四中段 2HF004 Channel 1.57 WL73 1.71
十四中段 2HF005 Channel 6.82 WL74 6.87
十四中段 2HF006 Channel 23.4 WL75 25.3
十八中段 2KH303 Channel 34.27 WL76 26
十八中段 2KH304 Channel 53.22 WL77 49.1
十八中段 2KH305 Channel 13.2 WL78 15.1
十八中段 2KH306 Channel 36.5 WL79 42.2
十一中 H226 Drill Core 8.25 WL80 9.26
十一中 H227 Drill Core 5.52 WL81 5.24
十一中 H228 Drill Core 9.41 WL82 9.4
十中段 9HF251 Drill Core 1.67 WL83 1.91
十中段 9HF252 Drill Core 2.52 WL84 2.59
十中段 9HF253 Drill Core 6.29 WL85 5.93
十中段 9HF255 Channel 5.96 WL86 5.3
十一中段 9HF269 Channel 1.01 WL87 1.6
十一中段 9HF270 Channel 2.7 WL88 2.79
十一中段 9HF271 Channel 1.46 WL89 3.31
六中段 H19 Channel 8.06 WL90 6.87
六中段 H20 Channel 12.42 WL91 14.3
十九中 H201 Channel 8.42 WL92 8.95
十九中 H202 Channel 6.85 WL93 6.16
十九中 H203 Channel 7.73 WL94 9.26
十九中 H219 Channel 6.78 WL95 7.24
十九中 H220 Channel 7.38 WL96 7.15
二十中 H241 Channel 13.57 WL97 14.7
二十中 H242 Channel 12.63 WL98 11.6
– IIIA-441 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1267 ---
Ore Sample
Sample Type
Original Check Sample Check
No. Au g/t No. Au g/t
二十中 H243 Channel 6.2 WL99 7.07
ZK18423H2 Channel 3.5 WL100 3.76
1811 沿（十八中段）1 Channel 5.7 WL101 9.06
1811 沿（十八中段）2 Channel 19 WL102 20.7
1811 沿（十八中段）3 Channel 31 WL103 36.5
1811 沿（十八中段）4 Channel 9.4 WL104 10.3
1811 沿（十八中段）5 Channel 5.6 WL105 5.44
18 中水平（十八中段）53 Channel 30.5 WL106 33.3
18 中水平（十八中段）54 Channel 1.2 WL107 1.68
18 中水平（十八中段）34 Channel 1.2 WL108 1.14
十九中段 32 Channel 3.2 WL109 3.59
十九中段 30 Channel 5.4 WL110 4.87
十九中段 29 Channel 3.3 WL111 2.95
十九中段 16 Channel 11.7 WL112 13.7
十九中段 14 Channel 14.6 WL113 16.5
十九中段 13 Channel 7 WL114 7.41
ZK1816313 Drill Core 4.5 WL115 4.45
ZK1816314 Drill Core 2.1 WL116 1.91
ZK1816333 Drill Core 5.3 WL117 4.99
ZK1816334 Drill Core 14.2 WL118 13.8
ZK1816335 Drill Core 17.6 WL119 18.2
ZK1816336 Drill Core 4.9 WL120 5.1
ZK1816342 Drill Core 6.3 WL121 7.47
ZK1816343 Drill Core 1.1 WL122 1.42
ZK1816344 Drill Core 2.4 WL123 3.22
ZK19112H4 Drill Core 2.4 WL124 2.19
ZK19112H5 Drill Core 3.5 WL125 3.51
ZK19112H6 Drill Core 1.3 WL126 1.28
ZK19112H8 Drill Core 2.7 WL127 2.93
ZK19112H9 Drill Core 2.1 WL128 2.4
ZK19112H10 Drill Core 2.2 WL129 2.88
Assay Results for Verification Samples Collected on the Wulong Project (Haojingou-Ligunzi Deposit)
Hole id  Check sample No. Original
Au(g/t)
SGS
Au(g/t)
TC2-558-1 HJG01 1.09 0.93
ZK500-2 HJG02 1.28 1.08
321-225-1 HJG03 1.45 1.17
K232-1-232-40 HJG04 1.7 1.61
ZK796-1 HJG05 1.78 1.83
K232-1-232-50 HJG06 2 1.83
ZK772-1 HJG07 2.14 2.44
ZK521-1 HJG08 2.31 1.90
– IIIA-442 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1268 ---
Hole id  Check sample No. Original
Au(g/t)
SGS
Au(g/t)
TC38-549-1 HJG09 2.56 2.21
TC547-547-20 HJG10 2.72 2.19
ZK508-4 HJG11 2.91 2.68
ZK505-2 HJG12 3.18 2.75
ZK805-4 HJG13 3.38 2.84
K230-1-230-15 HJG14 3.7 3.19
K231-3-231-3 HJG15 4.1 3.59
TC547-547-7 HJG16 4.49 4.59
ZK508-2 HJG17 4.8 4.62
K233-1-233-11 HJG18 5.3 6.30
ZK824-1 HJG19 5.87 6.64
ZK512-5 HJG20 6.51 4.22
307-231-7 HJG21 6.82 8.12
K232-1-232-49 HJG22 7.2 7.84
ZK830-2 HJG23 7.51 7.27
ZK509-2 HJG24 7.98 8.15
307-232-12 HJG25 8.41 9.39
307-232-10 HJG26 8.73 8.41
K31-1-231-1 HJG27 9.3 9.10
307-232-11 HJG28 10.3 9.09
63-547-14 HJG29 11.1 12.7
ZK820-1 HJG30 13.5 13.9
TC547-547-17 HJG31 15.33 16.5
ZK820-6 HJG32 17.8 15.3
ZK818-6 HJG33 20.4 21.5
CK551-1 HJG34 27.6 2.32
TC547-547-18 HJG35 41.08 6.63
TC547-547-11 HJG36 433.99 5.44

Assay Results for Verification Samples Collected on the Hanfeng Project (Lishan Mine)
Ore Sample
Sample Type
Original Check
Sample Check
No. Cu (%）） Pb (%) Zn (%) No. Cu (%）） Pb (%) Zn (%)
ZK24A10-5-63 Drill Core 0.562 0. 011 0.538 LS001 0.547 0.011 0.5 53
ZK24A10-7-55 Drill Core 1.213 0.0 2 0.666 LS002 1.5 0.015 0.658
ZK24A8-1-24 Drill Core 0.207 0. 019 3.429 LS003 0.185 0.027 2.55
ZK24A8-2-39 Drill Core 0.215 0. 107 3.118 LS004 0.231 0.119 3.03
ZK24A8-3-28 Drill Core 0.317 0. 002 2.025 LS005 0.327 0.0032 1.8 8
ZK24A4-1-37 Drill Core 0.274 0. 039 2.784 LS006 0.275 0.038 2.89
ZK24A4-2-32 Drill Core 0.708 0. 131 13.501 LS007 0.665 0.13 12.5 6
ZK24A4-2-33 Drill Core 0.452 0.018  12.035 LS008 0.43 0.022 11.1 8
ZK24A4-2-34 Drill Core 0.695 0. 049 2.06 LS009 0.702 0.05 1.85
ZK24A4-2-35 Drill Core 0.714 0. 029 1.426 LS010 0.629 0.029 1.29
– IIIA-443 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1269 ---
Ore Sample
Sample Type
Original Check
Sample Check
No. Cu (%）） Pb (%) Zn (%) No. Cu (%）） Pb (%) Zn (%)
ZK24A4-3-31 Drill Core 0.723 0. 038 3.625 LS011 0.771 0.02 3.33
ZK24A4-4-26 Drill Core 0.633 0. 044 2.598 LS012 0.684 0.033 2.55
ZK24A4-4-32 Drill Core 0.219 0. 121 2.283 LS013 0.233 0.117 2.4
ZK24A4-5-69 Drill Core 2.241 0. 001 0.897 LS014 2.13 0.0036 0.86 5
ZK24A4-5-70 Drill Core 5.909 0. 001 0.675 LS015 6.25 0.0051 0.64 7
ZK24A4-6-51 Drill Core 0.43 0.017  4.536 LS016 0.14 0.0056 4.27
ZK24A4-6-75 Drill Core 1.681 0. 019 5.716 LS017 1.65 0.0033 5.02
ZK24A4-6-79 Drill Core 0.222 0. 012 0.659 LS018 0.223 0.0049 0.6 59
ZK24A4-6-81 Drill Core 11.8 0.016  0.743 LS019 10.35 0.0044 0.68
ZK24A4-6-84 Drill Core 0.261 0. 013 0.534 LS020 0.263 0.012 0.51 1
ZK24A4-6-85 Drill Core 0.777 0. 062 0.853 LS021 0.84 0.056 0.876
ZK24A0-3-41 Drill Core 0.214 0. 111 3.43 LS022 0.187 0.077 2.94
ZK24A0-3-45 Drill Core 0.236 0. 069 4.716 LS023 0.228 0.028 4.53
ZK24A0-3-46 Drill Core 0.702 0. 251 2.205 LS024 0.697 0.224 2.08
ZK24A0-3-47 Drill Core 0.217 0. 036 0.618 LS025 0.215 0.0093 0.5 54
ZK24A0-5-13 Drill Core 0.342 0. 058 3.195 LS026 0.347 0.0089 2.8 4
ZK24A0-5-19 Drill Core 0.399 0. 115 4.674 LS027 0.442 0.04 4.3
ZK24A0-5-20 Drill Core 0.263 0. 007 6.727 LS028 0.289 0.02 6.46
ZK24A0-5-16 Drill Core 0.217 0. 017 1.318 LS029 0.211 0.011 1.23
ZK24A0-7-30 Drill Core 0.229 0. 023 2.841 LS030 0.195 0.024 2.53
ZK24A0-7-31 Drill Core 0.224 0. 181 3.519 LS031 0.218 0.202 3.43
ZK24A0-9-18 Drill Core 0.496 0. 019 1.936 LS032 0.493 0.0037 1.7 6
ZK24A0-9-21 Drill Core 0.291 0. 018 2.281 LS033 0.294 0.0026 2.1 5
ZK24A0-10-12 Drill Core 0.302 0. 001 2.765 LS034 0.196 0.0027 2. 71
ZK24A0-10-20 Drill Core 0.562 0. 001 1.363 LS035 0.577 0.0022 1. 25
ZK24A0-10-25 Drill Core 0.331 0. 001 6.84 LS036 0.343 0.0012 6.2 6
ZK24A0-11-17 Drill Core 1.476 0. 001 1.204 LS037 1.36 0.0046 1.0 2
ZK24A0-11-18 Drill Core 3.739 0. 001 1.478 LS038 3.25 0.0041 1.2 4
ZK24A0-11-25 Drill Core 0.334 0. 001 3.532 LS039 0.336 0.0087 2. 75
ZK24A0-11-26 Drill Core 2.137 0. 001 2.247 LS040 1.72 0.0011 1.7 4
ZK24A0-11-31 Drill Core 0.272 0. 002 0.605 LS041 0.245 0.0055 0. 514
ZK24A0-11-32 Drill Core 0.247 0. 001 1.589 LS042 0.214 0.0033 1. 26
ZK24A0-12-32 Drill Core 0.363 0. 001 1.626 LS043 0.324 0.0041 1. 35
ZK24A0-12-33 Drill Core 0.885 0. 001 2.097 LS044 0.707 0.0065 2. 52
ZK24A0-12-34 Drill Core 0.291 0. 001 4.136 LS045 0.261 0.0041 3. 38
ZK24A0-12-35 Drill Core 7.552 0. 001 1.952 LS046 7.05 0.0039 1.4 9
ZK24A0-12-36 Drill Core 0.669 0. 001 2.413 LS047 0.638 0.0084 2. 07
ZK24A0-12-37 Drill Core 3.73 0.001  1.414 LS048 3.27 0.003 1.18
ZK24A0-12-40 Drill Core 0.351 0. 001 2.303 LS049 0.321 0.0027 1. 79
ZK24A0-12-41 Drill Core 0.421 0. 001 2.076 LS050 0.318 0.014 1.9 4
ZK24A0-12-42 Drill Core 0.361 0. 001 2.269 LS051 0.288 0.0029 2. 12
ZK24A0-12-43 Drill Core 0.362 0. 001 2.276 LS052 0.312 0.014 1.9
ZK24A0-12-10 Drill Core 4.845 0. 001 0.855 LS053 4.37 0.0045 0.7 87
ZK24A0-13-21 Drill Core 0.394 0. 001 3.082 LS054 0.37 0.01 2.86
ZK24A0-13-22 Drill Core 0.732 0. 081 5.265 LS055 0.727 0.089 4.2 2
ZK24A0-13-23 Drill Core 0.898 0. 018 3.752 LS056 0.911 0.0041 2. 9
ZK24A0-13-31 Drill Core 0.565 0. 155 6.311 LS057 0.579 0.161 6.4 9
– IIIA-444 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1270 ---
Ore Sample
Sample Type
Original Check
Sample Check
No. Cu (%）） Pb (%) Zn (%) No. Cu (%）） Pb (%) Zn (%)
ZK24A0-13-36 Drill Core 0.513 0. 001 7.312 LS058 0.488 0.0042 6. 79
ZK24A0-14-47 Drill Core 0.536 0. 013 1.658 LS059 0.531 0.015 1.4 6
ZK24A0-14-52 Drill Core 0.202 0. 001 1.487 LS060 0.197 0.0042 1. 47
ZK24A0-14-53 Drill Core 0.435 0. 001 3.971 LS061 0.424 0.01 3.96
ZK24A0-14-58 Drill Core 0.536 0. 073 2.984 LS062 0.494 0.079 2.6 5
ZK24A0-14-60 Drill Core 0.354 0. 003 2.016 LS063 0.323 0.015 1.9 7
ZK24A0-15-50 Drill Core 0.344 0. 354 6.976 LS064 0.345 0.346 6.7 2
ZK24A0-15-54 Drill Core 0.308 0. 121 4.42 LS065 0.287 0.119 3.83
ZK24A0-15-55 Drill Core 0.318 0. 078 5.008 LS066 0.293 0.074 5.0 8
ZK24A0-15-57 Drill Core 0.228 0. 129 5.067 LS067 0.223 0.123 5.1 6
ZK24A0-15-58 Drill Core 0.277 0. 104 2.243 LS068 0.272 0.105 1.8 4
ZK24A0-17-50 Drill Core 0.203 0. 096 11.705 LS069 0.213 0.103 10 .28
ZK24A0-17-71 Drill Core 7.177 0. 008 1.292 LS070 0.777 0.0047 1. 26
ZK24A0-17-92 Drill Core 0.281 0. 008 0.597 LS071 0.308 0.0035 0. 221
ZK24A0-17-81 Drill Core 0.618 0. 009 0.504 LS072 0.638 0.0031 0. 295
ZK24A0-17-82 Drill Core 0.528 0. 014 0.963 LS073 0.551 0.0034 0. 901
ZK24A0-17-83 Drill Core 0.479 0. 024 1.143 LS074 0.493 0.0047 1. 08
ZK24A0-17-84 Drill Core 0.998 0. 015 1.541 LS075 1.07 0.0035 1.4 7
ZK24A0-17-87 Drill Core 0.676 0. 017 1.275 LS076 0.733 0.003 1.2 1
ZK24A1-2-3 Drill Core 0.204 0.001  5.948 LS077 0.162 0.0043 5.67
ZK24A1-2-4 Drill Core 0.873 0.001  5.221 LS078 0.795 0.0052 5.02
ZK24A1-4-53 Drill Core 0.289 0. 001 5.881 LS079 0.28 0.0044 5.74
ZK24A1-4-56 Drill Core 0.22 0.006  2.374 LS080 0.22 0.011 2.36
ZK24A1-4-58 Drill Core 0.61 0.281  3.845 LS081 0.55 0.25 3.72
ZK24A1-4-59 Drill Core 0.211 0. 063 2.581 LS082 0.206 0.065 2.51
ZK24A1-7-6 Drill Core 0.587 0.017  0.621 LS083 0.576 0.011 0.572
ZK24A1-7-14 Drill Core 0.629 0. 009 2.362 LS084 0.638 0.0079 2.1 3
ZK24A1-7-15 Drill Core 0.881 0. 008 3.251 LS085 0.826 0.0057 3.1 7
ZK24A1-7-16 Drill Core 0.966 0. 004 1.804 LS086 0.904 0.0027 1.6 1
ZK24A1-7-21 Drill Core 0.211 0. 004 2.706 LS087 0.208 0.004 2.47
ZK24A1-8-16 Drill Core 0.421 0. 001 4.607 LS088 0.388 0.0038 4.6 1
ZK24A1-8-17 Drill Core 0.269 0. 002 2.986 LS089 0.245 0.0038 2.6 6
ZK24A1-8-20 Drill Core 0.723 0.04 9.817 LS090 0.748 0.041 8.96
ZK24A1-8-21 Drill Core 0.213 0. 001 3.909 LS091 0.202 0.0065 3.6 8
ZK24A1-8-23 Drill Core 0.741 0. 119 2.891 LS092 0.766 0.113 2.78
ZK24A1-8-29 Drill Core 2.522 0. 001 2.011 LS093 2.31 0.031 1.9
ZK24A1-8-42 Drill Core 2.195 0. 008 7.855 LS094 2.36 0.0066 6.48
ZK24A1-8-43 Drill Core 2.681 0. 036 12.283 LS095 2.75 0.03 10.45
ZK24A1-8-44 Drill Core 1.828 0.119  17.639 LS096 1.92 0.115 15.3 4
ZK24A1-9-15 Drill Core 0.419 0. 001 1.597 LS097 0.426 0.0041 1.5 8
ZK24A1-9-16 Drill Core 0.283 0. 001 1.506 LS098 0.298 0.0027 1.4 1
ZK24A1-9-17 Drill Core 0.389 0. 001 3.141 LS099 0.397 0.0033 2.9 1
ZK24A1-9-18 Drill Core 0.573 0. 001 4.221 LS100 0.593 0.0091 4.1 1
ZK24A1-9-21 Drill Core 0.219 0. 001 3.425 LS101 0.221 0.0035 3.2 7
ZK24A1-9-24 Drill Core 0.263 0. 001 0.861 LS102 0.283 0.0059 0.9 51
ZK24A1-9-34 Drill Core 0.372 0. 001 3.704 LS103 0.38 0.0019 3.57
ZK24A1-9-35 Drill Core 0.624 0. 001 8.049 LS104 0.571 0.0025 7.4
– IIIA-445 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1271 ---
Ore Sample
Sample Type
Original Check
Sample Check
No. Cu (%）） Pb (%) Zn (%) No. Cu (%）） Pb (%) Zn (%)
ZK24A3-9-54 Drill Core 0.252 0. 254 5.862 LS105 0.266 0.262 5.09
ZK24A3-9-55 Drill Core 0.563 0. 059 8.594 LS106 0.548 0.074 7.66
ZK24A3-9-56 Drill Core 0.947 0.001  11.906 LS107 1.03 0.013 10.3 8
ZK24A3-9-57 Drill Core 0.232 0. 196 11.597 LS108 0.212 0.206 9.7 6
ZK24A3-9-58 Drill Core 0.596 0. 043 10.303 LS109 0.603 0.063 9.9 2
ZK24A3-9-59 Drill Core 0.401 0. 001 14.76 LS110 0.391 0.016 11.7 5
ZK24A3-10-63 Drill Core 1.224 0. 051 5.284 LS111 1.17 0.042 5.61
ZK24A3-10-64 Drill Core 1.782 0. 004 3.819 LS112 1.84 0.012 3.34
ZK24A3-10-65 Drill Core 2.955 0. 046 2.712 LS113 2.9 0.036 2.25
ZK24A3-10-66 Drill Core 1.702 0. 109 0.886 LS114 1.75 0.111 0.83 8
ZK24A3-10-69 Drill Core 1.033 0. 004 4.884 LS115 1.23 0.017 4.41
ZK24A3-10-71 Drill Core 1.259 0. 001 3.015 LS116 1.35 0.0029 2.7 5
ZK24A3-10-75 Drill Core 6.494 0. 005 0.529 LS117 5.87 0.0084 0.4 32
ZK24A3-10-78 Drill Core 4.607 0. 001 0.638 LS118 3.96 0.0036 0.4 58
ZK24A3-10-79 Drill Core 7.909 0. 005 0.521 LS119 7.02 0.0041 0.4 52
ZK24A3-10-80 Drill Core 11.107 0.006 0.668 LS120 10.4 0.0036 0. 536
ZK24A3-10-85 Drill Core 2.936 0. 001 0.601 LS121 2.6 0.0037 0.44 3
ZK24A3-10-86 Drill Core 6.079 0. 003 0.593 LS122 5.96 0.0037 0.4 79
ZK24B2-5-80 Drill Core 1.947 0. 008 2.146 LS123 1.84 0.0019 1.79
ZK24B2-5-82 Drill Core 1.117 0. 001 5.661 LS124 1.07 0.0055 5.33
ZK24B2-5-85 Drill Core 5.343 0. 007 0.51 LS125 5.06 0.0033 0.484
ZK24B2-5-87 Drill Core 14.862 0. 001 1.243 LS126 12.15 0.0026 1. 02
ZK2402-4 Drill Core 2.24 0.24 2.98 LS127 2.26 0.216 2.82
C15-2-21-136 Channel 0.529 0.148  23.19 LS128 0.512 0.212 20.47
23C001-KT23C001-63 Channel 1.365 0 .166 2.789 LS129 1.35 0.177 1 .81
23C001-KT23C001-65 Channel 0.892 0 .126 2.494 LS130 0.988 0.135 2.22
23C001-KT23C001-68 Channel 1.988 0 .171 3.742 LS131 2.02 0.173 3 .3
23C001-KT23C001-69 Channel 2.596 0 .211 2.864 LS132 2.85 0.219 2 .59
23C001-KT23C001-70 Channel 0.515 0 .268 1.563 LS133 0.604 0.256 1.37
23C001-KT23C001-71 Channel 1.597 0 .137 2.382 LS134 1.7 0.16 2.1 8
23C001-KT23C001-72 Channel 6.147 0 .249 2.123 LS135 6.14 0.225 3 .72
23C001-KT23C001-73 Channel 2.098 0 .32 2.768 LS136 2.36 0.261 2. 51
23C001-KT23C001-82 Channel 4.901 0 .17 4.594 LS137 5.16 0.177 4. 14
24C001-KT24C001-35 Channel 0.265 0 .183 1.868 LS138 0.255 0.16 1 .62
24C001-KT24C001-36 Channel 0.346 0 .102 2.147 LS139 0.373 0.108 2.13
24C001-KT24C001-44 Channel 0.324 0 .339 1.764 LS140 0.35 0.308 1 .7
24C009-KT24C009-2 Channel 1.585 0. 149 20.54 LS141 1.43 0.158 16 .51
24C009-KT24C009-7 Channel 0.941 0 .206 4.068 LS142 0.814 0.165 3 .04
24C009-KT24C009-8 Channel 0.468 0. 151 4.402 LS143 0.42 0.124 3. 31
24C009-KT24C009-9 Channel 0.378 0 .105 2.097 LS144 0.365 0.092 1 .56
24C009-KT24C009-10 Channel 0.699 0 .205 5.49 LS145 0.687 0.183 4 .54
24C009-KT24C009-11 Channel 0.732 0 .306 7.07 LS146 0.831 0.292 6 .72
24C009-KT24C009-12 Channel 0.944 0. 391 7.96 LS147 1.05 0.363 7. 15
24C009-KT24C009-13 Channel 0.791 0 .461 7.09 LS148 0.931 0.386 7 .41
24C009-KT24C009-14 Channel 0.687 0 .364 4.43 LS149 0.764 0.352 6 .52
24C009-KT24C009-15 Channel 0.505 0 .216 6.55 LS150 0.559 0.201 3 .15
24C009-KT24C009-16 Channel 0.608 0 .192 4.03 LS151 0.7 0.187 3.46
– IIIA-446 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1272 ---
Ore Sample
Sample Type
Original Check
Sample Check
No. Cu (%）） Pb (%) Zn (%) No. Cu (%）） Pb (%) Zn (%)
24C009-KT24234 Channel 1.812 0.114  20.98 LS152 1.72 0.111 21.42

Assay Results for Verification Samples Collected from the Hanfeng Project (Dongfeng Mine)
Ore Sample No. Sample Type Original Mo (%) Check Sample No. Che ck Mo (%)
ZK1001_133 Core 0.036 DF001 0.035
ZK1002_97 Core 0.03 DF002 0.029
ZK1005_230 Core 0.033 DF003 0.03
ZK201_144 Core 0.031 DF004 0.027
ZK203_102 Core 0.091 DF005 0.098
ZK102_51 Core 0.089 DF006 0.093
ZK104_90 Core 0.073 DF007 0.073
ZK501_217 Core 0.043 DF008 0.04
ZK505_67 Core 0.067 DF009 0.068
ZK901_230 Core 0.058 DF010 0.06
ZK903_198 Core 0.034 DF011 0.032
ZK906_67 Core 0.035 DF012 0.032
ZK1102_5 Core 0.054 DF013 0.05
ZK1105_84 Core 0.044 DF014 0.047
ZK1108_68 Core 0.044 DF015 0.048
ZK1113_47 Core 0.047 DF016 0.044
ZK1118_65 Core 0.052 DF017 0.049
ZK1302_115 Core 0.042 DF018 0.04
ZK1305_75 Core 0.086 DF019 0.083
ZK1308_73 Core 0.079 DF020 0.096
ZK1310_92 Core 0.044 DF021 0.048
ZK1501_5 Core 0.035 DF022 0.034
ZK1502_87 Core 0.086 DF023 0.082
ZK1504_90 Core 0.058 DF024 0.06
ZK1506_113 Core 0.065 DF025 0.073
ZK1509_152 Core 0.092 DF026 0.087
ZK1513_63 Core 0.07 DF027 0.085
ZK1517_53 Core 0.031 DF028 0.029
ZK1701_6DH2349 Core 0.037 DF029 0.035
ZK1706_44 Core 0.095 DF030 0.096
ZK1709_58 Core 0.039 DF031 0.037
ZK1902_16 Core 0.065 DF032 0.067
ZK1903_54 Core 0.088 DF033 0.093
ZK1905_47 Core 0.048 DF034 0.046
ZK1907_68 Core 0.098 DF035 0.099
ZK1911_108 Core 0.047 DF036 0.051
ZK1914_126 Core 0.086 DF037 0.084
– IIIA-447 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1273 ---
Ore Sample No. Sample Type Original Mo (%) Check Sample No. Che ck Mo (%)
ZK2101_H83 Core 0.079 DF038 0.074
ZK2103_6DH2709 Core 0.041 DF039 0.046
ZK2104_H1097 Core 0.051 DF040 0.056
ZK2106_112 Core 0.08 DF041 0.082
ZK2111_24 Core 0.046 DF042 0.05
ZK2301_9 Core 0.039 DF043 0.036
ZK2302_95 Core 0.038 DF044 0.039
ZK2303_124 Core 0.033 DF045 0.036
ZK2305_114 Core 0.042 DF046 0.047
ZK2307_68 Core 0.038 DF047 0.036
ZK2310_32 Core 0.034 DF048 0.034
ZK2312_103 Core 0.05 DF049 0.0018
ZK2314_166 Core 0.084 DF050 0.091
ZK2502_6DH2778 Core 0.036 DF051 0.033
ZK2503_H447 Core 0.06 DF052 0.065
ZK2505_H1150 Core 0.044 DF053 0.073
ZK2505_H1216 Core 0.032 DF054 0.031
ZK2506_H1668 Core 0.053 DF055 0.061
ZK2507_71 Core 0.046 DF056 0.043
ZK2510_179 Core 0.038 DF057 0.032
ZK2513_14 Core 0.053 DF058 0.059
ZK2516_91 Core 0.055 DF059 0.054
ZK2521_79 Core 0.032 DF060 0.036
ZK2702_142 Core 0.041 DF061 0.036
ZK2704_207 Core 0.041 DF062 0.037
ZK2707_111 Core 0.094 DF063 0.095
ZK2710_56 Core 0.048 DF064 0.048
ZK2711_137 Core 0.058 DF065 0.058
ZK2714_76 Core 0.096 DF066 0.091
ZK2901_6DH890 Core 0.034 DF067 0.037
ZK2902_6DH1804 Core 0.057 DF068 0.059
ZK2904_5 Core 0.044 DF069 0.046
ZK2905_35 Core 0.035 DF070 0.031
ZK2909_44 Core 0.092 DF071 0.094
ZK2912_169 Core 0.034 DF072 0.035
ZK2915_80 Core 0.072 DF073 0.066
ZK3104_2 Core 0.03 DF074 0.025
ZK3107_103 Core 0.056 DF075 0.064
ZK3302_114 Core 0.09 DF076 0.095
ZK3304_150 Core 0.033 DF077 0.025
ZK3306_15 Core 0.03 DF078 0.029
ZK3311_47 Core 0.052 DF079 0.046
ZK3310_18 Core 0.053 DF080 0.053
ZK3702_25 Core 0.039 DF081 0.037
– IIIA-448 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1274 ---
Ore Sample No. Sample Type Original Mo (%) Check Sample No. Che ck Mo (%)
ZK4102_59 Core 0.048 DF082 0.052
ZK1001_134 Core 0.126 DF083 0.127
ZK1002_121 Core 0.262 DF084 0.262
ZK1003_187 Core 0.155 DF085 0.152
ZK202_196 Core 0.215 DF086 0.233
ZK102_125 Core 0.148 DF087 0.162
ZK105_83 Core 0.178 DF088 0.189
ZK502_232 Core 0.105 DF089 0.11
ZK506_7 Core 0.11 DF090 0.108
ZK903_225 Core 0.22 DF091 0.225
ZK1101_55 Core 0.162 DF092 0.153
ZK1104_116 Core 0.145 DF093 0.142
ZK1109_4 Core 0.109 DF094 0.101
ZK1117_53 Core 0.276 DF095 0.309
ZK1304_37 Core 0.115 DF096 0.126
ZK1310_68 Core 0.109 DF097 0.115
ZK1501_113 Core 0.278 DF098 0.294
ZK1505_109 Core 0.186 DF099 0.193
ZK1508_122 Core 0.306 DF100 0.326
ZK1516_20 Core 0.111 DF101 0.116
ZK1702_105 Core 0.167 DF102 0.17
ZK1709_76 Core 0.265 DF103 0.263
ZK1904_15 Core 0.112 DF104 0.125
ZK1908_5 Core 0.242 DF105 0.245
ZK1913_50 Core 0.352 DF106 0.347
ZK2103_H136 Core 0.116 DF107 0.125
ZK2108_31 Core 0.328 DF108 0.32
ZK2114_48 Core 0.187 DF109 0.21
ZK2302_46 Core 0.258 DF110 0.247
ZK2304_40 Core 0.165 DF111 0.164
ZK2307_38 Core 0.311 DF112 0.322
ZK2311_24 Core 0.314 DF113 0.312
ZK2314_69 Core 0.303 DF114 0.312
ZK2502_H321 Core 0.256 DF115 0.276
ZK2505_H1203 Core 0.455 DF116 0.506
ZK2511_47 Core 0.448 DF117 0.448
ZK2515_105 Core 0.169 DF118 0.18
ZK2521_38 Core 0.124 DF119 0.13
ZK2703_38 Core 0.122 DF120 0.136
ZK2707_32 Core 0.152 DF121 0.155
ZK2710_33 Core 0.163 DF122 0.181
ZK2711_142 Core 0.151 DF123 0.154
ZK2901_6DH916 Core 0.115 DF124 0.112
ZK2904_111 Core 0.132 DF125 0.143
– IIIA-449 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1275 ---
Ore Sample No. Sample Type Original Mo (%) Check Sample No. Che ck Mo (%)
ZK2910_122 Core 0.157 DF126 0.175
ZK2915_56 Core 0.13 DF127 0.147
ZK3107_63 Core 0.201 DF128 0.212
ZK3307_7 Core 0.164 DF129 0.155
ZK3306_2 Core 0.198 DF130 0.195
ZK3312_122 Core 0.104 DF131 0.111
ZK504_103 Core 0.246 DF132 0.234
ZK505_3 Core 0.589 DF133 0.588
ZK1904_161 Core 0.684 DF134 0.719
ZK2307_55 Core 1.184 DF135 1.16
ZK2709_9 Core 1.204 DF136 1.21
ZK3702_97 Core 0.597 DF137 0.61
ZK1903_88 Core 1.528 DF138 1.43
ZK2710_131 Core 2.24 DF139 2.07
8 中_D8CM2 Channel 0.065 DF140 0.065
9 中_D9YM2 Channel 0.044 DF141 0.053
9 中_D9CM1 Channel 0.041 DF142 0.036
9 中_D9CM5 Channel 0.076 DF143 0.074
9 中_D9CM10 Channel 0.032 DF144 0.033
9 中_D9CM10 Channel 0.089 DF145 0.108
10 中_D10CM1 Channel 0.067 DF146 0.071
10 中_D10CM7 Channel 0.044 DF147 0.044
10 中_D10CM5 Channel 0.034 DF148 0.033
10 中_D10CM8 Channel 0.067 DF149 0.055
10 中_D10CM8 Channel 0.056 DF150 0.062
10 中_D10CM10 Channel 0.071 DF151 0.072
11 中_D11CM2 Channel 0.058 DF152 0.08
11 中_D11CM8 Channel 0.05 DF153 0.05
12 中_D12CM2 Channel 0.066 DF154 0.066
12 中_D12CM4 Channel 0.045 DF155 0.049
12 中_D12CM5 Channel 0.031 DF156 0.029
12 中_D12CM6 Channel 0.048 DF157 0.049
12 中_D12CM1 Channel 0.054 DF158 0.057
12 中_D12CM1 Channel 0.044 DF159 0.047
8 中_D8CM7 Channel 0.265 DF160 0.258
8 中_D8CM7 Channel 0.261 DF161 0.244
8 中_D8CM1 Channel 0.233 DF162 0.216
9 中_D9CM2 Channel 0.16 DF163 0.147
9 中_D9YM3 Channel 0.21 DF164 0.193
9 中_D9CM3 Channel 0.199 DF165 0.181
9 中_D9CM10 Channel 0.137 DF166 0.135
9 中_D9CM10 Channel 0.367 DF167 0.334
9 中_D9CM8 Channel 0.296 DF168 0.29
10 中_D10CM7 Channel 0.105 DF169 0.097
– IIIA-450 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1276 ---
Ore Sample No. Sample Type Original Mo (%) Check Sample No. Che ck Mo (%)
10 中_D10CM4 Channel 0.219 DF170 0.196
10 中_D10CM8 Channel 0.102 DF171 0.103
10 中_D10CM8 Channel 0.133 DF172 0.135
10 中_D10CM9 Channel 0.21 DF173 0.235
10 中_D10CM9 Channel 0.15 DF174 0.138
10 中_D10CM6 Channel 0.139 DF175 0.14
11 中_D11CM2 Channel 0.122 DF176 0.122
11 中_D11CM7 Channel 0.128 DF177 0.117
12 中_D12CM2 Channel 0.207 DF178 0.201
12 中_D12CM2 Channel 0.174 DF179 0.165
12 中_D12CM4 Channel 0.103 DF180 0.109
12 中_D12CM5 Channel 0.143 DF181 0.134
12 中_D12CM6 Channel 0.171 DF182 0.169
12 中_D12CM1 Channel 0.171 DF183 0.549
9 中_D9YM2 Channel 0.506 DF184 0.441
10 中_D10CM7 Channel 1.068 DF185 1.07
11 中_D11CM4 Channel 1.482 DF186 1.41
12 中_D12CM1 Channel 0.603 DF187 0.154
9 中_D9CM3 Channel 1.686 DF188 2.55
10 中_D10CM9 Channel 4.658 DF189 3.95

Assay Results for Verification Samples Collected from the Jintai Project
Sample Au_Xidengping Au_SGS Sample Au_Xidengping Au_SGS
BT102-1-H6 5.08 4.62 ZK110-9H34 1.10 0.88
BT106-H6 1.31 1.58 ZK114-5H29 19.70 17.20
BT130-1-H5 0.69 0.85 ZK120-7H54 2.69 2.75
YJK2H9 1.84 1.39 ZK121-1H18 0.35 0.31
ZK001H2 0.78 0.58 ZK124-7H42 1.28 1.59
ZK003H11 0.44 0.29 ZK124-7H54 0.330 0.29
ZK007H10 4.08 2.60 ZK1928-H45 0.60 0.53
ZK100-1H21 0.82 0.65 ZK2004H29 1.47 1.60
ZK100-3H18 6.03 5.83 ZK2401H5 7.14 5.73
ZK100-3H57 0.39 0.36 ZK2406H24 7.92 4.49
ZK100-5H30 2.16 1.48 ZK2820H6 0.89 0.01
ZK100-5H64 0.72 0.62 ZK301H3 0.39 0.32
ZK102-13H34 2.16 1.89 ZK307H3 0.88 0.64
ZK102-1H24 1.10 0.76 ZK401H14 0.57 0.49
ZK102-1H47 0.81 0.60 ZK404H27 0.52 0.37
ZK102-3H2 0.67 0.66 ZK405H5 0.64 0.53
ZK102-3H34 1.52 1.58 ZK801H18 0.55 0.50
– IIIA-451 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1277 ---
Sample Au_Xidengping Au_SGS Sample Au_Xidengping Au_SGS
ZK102-5H29 0.42 0.42 ZK803H12 0.37 0.40
ZK102-5H34 0.51 0.53 ZK82-25-H8 0.42 0.29
ZK102-5H36 0.34 0.21 ZK87-5-H18 17.20 16.60
ZK102-5H46 0.57 0.52 ZK94-13-H76 0.47 0.40
ZK104-0H112 0.87 0.94 ZK95-17-H2 0.42 0.38
ZK104-0H30 0.36 0.27 ZK95-6-H30 0.71 0.52
ZK104-0H4 3.60 3.38 ZK96-1-H106 0.32 0.43
ZK104-1H34 0.98 0.97 ZK97-1-H11 0.33 0.31
ZK104-1H9 5.31 4.17 ZK97-1-H18 0.57 1.22
ZK104-5H41 0.75 0.48 ZK98-0-H27 1.23 1.10
ZK104-5H68 1.16 1.18 ZK98-13-H25 1.10 1.09
ZK106-0H2 1.99 1.45 ZK98-13-H27 3.87 3.94
ZK106-0H26 2.38 1.28 ZK98-1-H19 2.09 1.48
ZK106-3H6 3.97 1.08 ZK98-25-H24 0.49 0.46
ZK106-3H14 3.04 1.81 ZK98-25-H35 2.43 1.82
ZK106-3H21 0.95 0.97 ZK98-3-H34 2.42 2.10
ZK106-3H13 1.93 3.66 ZK98-3-H43 0.40 0.31
ZK106-3H119 0.51 0.41 ZK98-9-H24 1.75 2.42
ZK106-3-H47 1.50 1.29 ZK98-9-H8 0.66 1.00
ZK106-3H77 2.33 2.17 ZK99-1-H4 3.12 2.73
ZK110-1H35 0.31 0.24 ZK99-2-H4 1.68 2.54
ZK110-3H10 2.65 2.97


– IIIA-452 –
APPENDIX IIIA COMPETENT PERSON ’S REPORT
FOR THE PRC MINES


--- page 1278 ---
Cover Page
Final
Competent Person's Report for the Sepon
Gold and Copper Project, Lao People's
Democratic Republic
Savannakhet Province , Lao People's Democratic Republic

Chifeng Jilong Gold Mining Co., Ltd.

SRK Consulting China Ltd.  SCN849B  28 February 2025

– IIIB-1 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


--- page 1279 ---
Final

Competent Person’s Report for the Sepon Gold and Copper Project, Lao
People's Democratic Republic
 Savannakhet Province , Lao People's Democratic Republic

Prepared for:
Chifeng Jilong Gold Mining Co., Ltd.
No.7 Xiaojingjia, Wanfeng Road
Fengtai District,  Beijing , China
10000



Prepared by:
SRK Consulting China Ltd.
B1301 COFCO Plaza, No. 8 Jianguomen Inner Street
Dongcheng District, Beijing, China
100005

+86 10 6511 1000
www.srk.com



Lead Author:  Anshun Xu (Corporate Consultant)) Initials: AX

Reviewer:  Yonglian Sun (Corporate Consultant) Initials: YS


Cover Image(s):
Ore Processing Plant and Smelter of Sepon Mine

Copyright © 2025
SRK Consulting China Ltd.    SCN849B    28 February 2025


Inside Cover Page
– IIIB-2 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


--- page 1280 ---
Acknowledgments
SRK would like to acknowledge the support and collaboration provided by LXML personnel for this assignment. Their
collaboration was greatly appreciated and instrumental to the success of this project.



Disclaimer and Notices

SRK Consulting China Ltd. has prepared this document for Chifeng Jilong Gold Mining Co., Ltd. (“Chifeng Gold”, or
“the Client”). Any use or decisions by which a third party makes of this document are the responsibility of such third
parties. In no circumstance does SRK accept any consequential liability arising from commercial decisions or actions
resulting from the use of this report by a third party.
The opinions expressed in this document have been based on the information available to SRK at the time of preparation. SRK
has exercised all due care in reviewing information supplied by  others for use on this project. While SRK has compared key
supplied data with expected values, the accuracy of the results and conclusions from the review are entirely reliant on the accuracy
and completeness of the supplied data. SRK does not accept responsibility for any errors or omissions in the supplied information,
except to the extent that SRK was hired to verify the data.
– IIIB-3 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


--- page 1281 ---
Competent Person's Report for the Sepon Gold and Copper Project, Lao People's Democratic Republic
Contents    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS iv
Contents
Useful Definitions ....................................................................................................................................................... xiii
1 Introduction and Terms of Reference ................................................................................................................. 1
2 Program Objectives and Work Program ............................................................................................................. 2
2.1 Purpose of the Report ........................................................................................................................................ 2
2.2 Scope of Work and Reporting Standard ............................................................................................................. 2
2.2.1 Scope of Work ..................................................................................................................................... 2
2.2.2 Basis of Technical Report ................................................................................................................... 2
2.2.3 Site Visit .............................................................................................................................................. 3
2.2.4 Reporting Standard ............................................................................................................................. 3
2.3 Limitations Statement ......................................................................................................................................... 3
2.4 Effective Date ..................................................................................................................................................... 4
2.5 Work Program .................................................................................................................................................... 4
2.6 SRK Experience ................................................................................................................................................. 4
2.7 SRK Project Team .............................................................................................................................................. 6
2.8 Warranties .......................................................................................................................................................... 8
2.9 Compliance Statement ....................................................................................................................................... 9
2.10 Independence Statement ................................................................................................................................... 9
2.11 Consent .............................................................................................................................................................. 9
2.12 Forward Looking Statement ............................................................................................................................. 10
3 Operational Licenses and Permits ................................................................................................................... 11
3.1 Mining License .................................................................................................................................................. 11
3.2 Exploration Permit ............................................................................................................................................ 11
3.3 Other Key Operational Licenses and Permits .................................................................................................. 12
4 Accessibility, Climate, Local Resources, Infrastructure, and Physiography .................................................... 13
4.1 Accessibility ...................................................................................................................................................... 13
4.2 Physiography and Climate................................................................................................................................ 13
4.3 Local Resources and Infrastructure ................................................................................................................. 14
5 History ............................................................................................................................................................... 15
6 Geological Setting and Mineralization .............................................................................................................. 16
6.1 Regional Geology ............................................................................................................................................. 16
6.1.1 Regional Stratigraphy ........................................................................................................................ 16
6.1.2 Regional Structures ........................................................................................................................... 17
6.1.3 Magmatic Rocks ................................................................................................................................ 17
6.1.4 Regional Mineralization ..................................................................................................................... 17
6.2 Property Geology .............................................................................................................................................. 17
6.2.1 Gold and Copper Deposit Geology ................................................................................................... 18
6.3 Deposit Types ................................................................................................................................................... 22
6.3.1 Copper and Gold Mineralization types .............................................................................................. 23
6.3.2 Main Factors of Metallogeny ............................................................................................................. 24
7 Exploration and its Quality Assurance and Quality Control and Sampling ...................................................... 26
7.1 Exploration Programs ....................................................................................................................................... 26
7.1.1 Exploration Programs of Gold and Copper Deposits Prior to Chifeng Gold ..................................... 26
7.1.2 Exploration Programs of Gold and Copper Deposits by Chifeng Gold ............................................. 28
– IIIB-4 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


--- page 1282 ---
Competent Person's Report for the Sepon Gold and Copper Project, Lao People's Democratic Republic
Contents    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS v
7.1.3 Trenching .......................................................................................................................................... 30
7.1.4 Drilling ............................................................................................................................................... 30
7.1.5 Mapping............................................................................................................................................. 32
7.2 Quality Assurance and Quality Control of the Exploration Programs .............................................................. 32
7.2.1 Standard Sample .............................................................................................................................. 32
7.2.2 Duplicates ......................................................................................................................................... 34
7.2.3 Blanks ................................................................................................................................................ 34
7.2.4 QA/QC Performance ......................................................................................................................... 34
7.2.5 SRK Comments ................................................................................................................................ 42
7.3 Sample Preparation, Analyses, and Security ................................................................................................... 42
7.3.1 Sample Preparation and Analyses of Gold and Copper Deposit ...................................................... 42
7.3.2 Bulk Density ...................................................................................................................................... 43
7.3.3 Database Management ..................................................................................................................... 43
7.3.4 SRK Comments ................................................................................................................................ 44
8 Data Verification ............................................................................................................................................... 45
8.1 Verifications by SRK ......................................................................................................................................... 45
8.2 Site Visits .......................................................................................................................................................... 48
9 Mineral Processing and Metallurgical Testing .................................................................................................. 51
9.1 Gold Ores ......................................................................................................................................................... 51
9.1.1 Mineralogy ......................................................................................................................................... 51
9.1.2 Metallurgical Tests ............................................................................................................................ 51
9.1.3 GRG Test .......................................................................................................................................... 52
9.1.4 Conclusion and Recommendation .................................................................................................... 55
9.2 Copper ores ...................................................................................................................................................... 55
9.2.1 Introduction ....................................................................................................................................... 55
9.2.2 Mineralogy ......................................................................................................................................... 56
9.2.3 Flotation Test .................................................................................................................................... 56
9.2.4 Conclusion and Recommendation .................................................................................................... 58
10 Mineral Resource Estimates............................................................................................................................. 59
10.1 Introduction ....................................................................................................................................................... 59
10.2 Year (Quarter)-end Map and Mined-out Areas ................................................................................................. 60
10.3 Mineral Resource Models ................................................................................................................................. 60
10.4 Open Pit Mining ................................................................................................................................................ 61
10.4.1 Discovery East (DSE OP) ................................................................................................................. 61
10.4.2 Discovery West (DSW OP) ............................................................................................................... 61
10.4.3 Namkok West (NKW OP) .................................................................................................................. 62
10.4.4 Nalou (NLU OP) ................................................................................................................................ 63
10.4.5 Ban Mai (MAI OP) ............................................................................................................................. 65
10.4.6 Ban Non (NON) ................................................................................................................................. 66
10.4.7 Nakachan (NAK OP) ......................................................................................................................... 67
10.4.8 Thenkham (TKM OP) ........................................................................................................................ 68
10.5 Underground Mining ......................................................................................................................................... 68
10.5.1 Discovery Deep East (DSE UG) ....................................................................................................... 68
10.5.2 Discovery Deep West (DSW UG) ..................................................................................................... 69
10.5.3 Khanong (KHN UG) .......................................................................................................................... 70
10.6 Stockpile ........................................................................................................................................................... 71
10.6.1 Gold Stockpile ................................................................................................................................... 71
10.6.2 Copper Stockpile ............................................................................................................................... 71
10.7 Conclusions and Recommendations ................................................................................................................ 72
– IIIB-5 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS vi
11 Ore Reserve Estimates .................................................................................................................................... 74
11.1 Introduction ....................................................................................................................................................... 74
11.2 Feasibility Study ............................................................................................................................................... 76
11.3 Mineral Resource Models ................................................................................................................................. 76
11.4 Open Pit Mining ................................................................................................................................................ 77
11.4.1 Month-end Map ................................................................................................................................. 77
11.4.2 Open Pit Design ................................................................................................................................ 77
11.4.3 Cut-off Grade .................................................................................................................................... 77
11.4.4 Dilution and Loss ............................................................................................................................... 78
11.4.5 DSE OP ............................................................................................................................................. 78
11.4.6 DSW OP ............................................................................................................................................ 80
11.4.7 NMK OP ............................................................................................................................................ 82
11.4.8 NLU OP ............................................................................................................................................. 84
11.4.9 SKM OP ............................................................................................................................................ 86
11.5 Underground Mining ......................................................................................................................................... 86
11.5.1 Mined-out Area .................................................................................................................................. 86
11.5.2 Underground Design ......................................................................................................................... 86
11.5.3 Cut-off Grade .................................................................................................................................... 87
11.5.4 Ore Reserve model ........................................................................................................................... 88
11.5.5 Dilution and Loss ............................................................................................................................... 89
11.5.6 Ore Reserve Estimates ..................................................................................................................... 90
11.5.7 Ore Reserve Statement .................................................................................................................... 92
11.6 Stockpiles ......................................................................................................................................................... 93
11.6.1 Cut-off Grade .................................................................................................................................... 93
11.6.2 Gold Stockpile ................................................................................................................................... 94
11.6.3 Copper Stockpile ............................................................................................................................... 95
11.7 Production Schedule ........................................................................................................................................ 95
11.8 Conclusions and Recommendations ................................................................................................................ 96
12 Mining ............................................................................................................................................................... 99
12.1 Production History and Current Status ............................................................................................................. 99
12.2 Hydrology and Hydrogeology ......................................................................................................................... 100
12.3 Open Pit Geotechnics ..................................................................................................................................... 101
12.3.1 Studies and Data ............................................................................................................................. 101
12.3.2 Seismicity ........................................................................................................................................ 102
12.3.3 Modes of Failure ............................................................................................................................. 102
12.3.4 Geotechnical Domains .................................................................................................................... 103
12.4 Open Pit Mining .............................................................................................................................................. 103
12.4.1 Grade Control .................................................................................................................................. 103
12.4.2 Open-pit Design .............................................................................................................................. 103
12.4.3 Waste Dumps Design ..................................................................................................................... 104
12.4.4 Ore Stockpiles Design ..................................................................................................................... 104
12.4.5 Mining Equipment ........................................................................................................................... 105
12.4.6 Conclusions and Recommendations .............................................................................................. 105
12.5 Underground Geotechnics .............................................................................................................................. 105
12.6 Underground Mining ....................................................................................................................................... 107
12.6.1 Development System ...................................................................................................................... 107
12.6.2 Mining Methods ............................................................................................................................... 108
12.6.3 Backfill ............................................................................................................................................. 109
12.6.4 Mining Equipment ........................................................................................................................... 109
12.6.5 Ventilation ....................................................................................................................................... 110
– IIIB-6 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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12.6.6 Conclusions and Recommendations .............................................................................................. 112
13 Recovery Methods .......................................................................................................................................... 113
13.1 Gold Processing Plant .................................................................................................................................... 113
13.1.1 Introduction ..................................................................................................................................... 113
13.1.2 Production Process ......................................................................................................................... 113
13.1.3 Production Performance ................................................................................................................. 116
13.1.4 Processing Facilities and Equipment .............................................................................................. 117
13.1.5 Consumable .................................................................................................................................... 118
13.1.6 Utilization of low-grade ore.............................................................................................................. 118
13.1.7 Conclusion and Recommendation .................................................................................................. 118
13.2 Copper Processing Plant ................................................................................................................................ 119
13.2.1 Introduction ..................................................................................................................................... 119
13.2.2 Production Flowsheet ...................................................................................................................... 119
13.2.3 Production Performance ................................................................................................................. 124
13.2.4 Metallurgical Facilities ..................................................................................................................... 125
13.2.5 Consumable .................................................................................................................................... 125
13.2.6 Utilization of Low-Grade Ore ........................................................................................................... 126
13.2.7 Conclusion and Recommendation .................................................................................................. 126
14 Project Infrastructure ...................................................................................................................................... 128
14.1 Tailings Storage Facilities ............................................................................................................................... 128
14.1.1 TSF1 ................................................................................................................................................ 128
14.1.2 WTSF .............................................................................................................................................. 129
14.2 External Transportation .................................................................................................................................. 130
14.3 Other Facilities in the Sepon Mine site ........................................................................................................... 131
14.3.1 Industrial Sites ................................................................................................................................. 131
14.3.2 Camps ............................................................................................................................................. 131
14.3.3 Airstrip ............................................................................................................................................. 131
15 Market Studies and Contracts ........................................................................................................................ 132
15.1 Copper Sales Contract ................................................................................................................................... 132
15.2 Gold Refining Contract ................................................................................................................................... 132
16 Environmental Studies, Permitting, and Social or Community Impact ........................................................... 133
16.1 Environmental and Social Review Objectives ................................................................................................ 133
16.2 Environmental and Social Review Process, Scope and Standards ............................................................... 133
16.3 Status of Environmental and Social Approvals .............................................................................................. 133
16.4 Environmental Compliance and Conformance ............................................................................................... 134
16.4.1 Water Aspects ................................................................................................................................. 134
16.4.2 Waste Rock and Tailings Management .......................................................................................... 135
16.4.3 General Solid Waste Management ................................................................................................. 135
16.4.4 Hazardous substance management ............................................................................................... 136
16.4.5 Site Ecological Assessment ............................................................................................................ 136
16.4.6 Dust, Gas and Noise Emissions ..................................................................................................... 137
16.4.7 Environmental Protection and Management Plan .......................................................................... 137
16.4.8 Site Closure Planning and Rehabilitation ........................................................................................ 137
16.4.9 Social Aspects ................................................................................................................................. 138
16.4.10 Occupational Health and Safety ..................................................................................................... 139
16.5 Evaluation of Environmental and Social Risks ............................................................................................... 140
17 Capital and Operating Costs .......................................................................................................................... 141
17.1 Capital Expenditures ...................................................................................................................................... 141
– IIIB-7 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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17.2 Historical Operating Costs .............................................................................................................................. 142
17.3 Opex Forecasting ........................................................................................................................................... 144
17.4 Metal Prices .................................................................................................................................................... 144
17.5 Tax Obligations ............................................................................................................................................... 147
18 Economic Analysis ......................................................................................................................................... 148
18.1 Principal Assumptions .................................................................................................................................... 148
18.1.1 Technical and Economic Parameters ............................................................................................. 148
18.1.2 Production Schedule ....................................................................................................................... 150
18.1.3 Capital Costs ................................................................................................................................... 151
18.1.4 Operating Costs .............................................................................................................................. 152
18.1.5 Tax and Surcharges ........................................................................................................................ 152
18.1.6 Amortization and Depreciation ........................................................................................................ 152
18.2 Financial Net Present Value ........................................................................................................................... 152
18.3 Sensitivity Analysis ......................................................................................................................................... 154
19 Conclusions and Recommendations .............................................................................................................. 156
19.1 Geology, Exploration and Mineral Resources ................................................................................................ 156
19.2 Mining and Ore Reserves ............................................................................................................................... 156
19.2.1 Gold Operation ................................................................................................................................ 156
19.2.2 Copper Operation ............................................................................................................................ 157
19.3 Ore Processing and Metallurgy ...................................................................................................................... 157
19.4 Mine Economy ................................................................................................................................................ 158
20 Project Qualitative Risk Analysis .................................................................................................................... 159
21 References ..................................................................................................................................................... 161

– IIIB-8 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Contents    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS ix
Tables
Table 2-1: SRK’s Reports for Listing on the HKEx .................................................................................................... 5
Table 2-2: SRK Project Team .................................................................................................................................... 6
Table 3-1: Mining License ....................................................................................................................................... 11
Table 3-2: Inflection Points of Sepon Exploration Permit ........................................................................................ 11
Table 3-3: Business License ................................................................................................................................... 12
Table 7-1: ALS and Sepon Lab Standards .............................................................................................................. 32
Table 7-2: Current Sepon Resource Assay Protocol .............................................................................................. 42
Table 8-1: Comparison with Re-assay by SRK and Original Assay from Sepon for Drilling Cores ........................ 45
Table 8-2: Assay Report for Rock Samples from Sepon by SRK 2022 .................................................................. 47
Table 8-3: Sites Visited at Sepon Property by SRK Team ...................................................................................... 48
Table 9-1: BGRIMM Flotation Test Results ............................................................................................................. 52
Table 9-2: Primary Concentrate Regrinding-recleaning Test Result ....................................................................... 54
Table 9-3: Mineral composition of Thengkham East Primary Samples .................................................................. 56
Table 9-4: Primary Copper Flotation Results .......................................................................................................... 57
Table 9-5: Master Composite Flotation Test Results .............................................................................................. 58
Table 10-1: Key Parameters of Mineral Resources Estimate (DSE OP) .................................................................. 61
Table 10-2: Mineral Resource Statement of DSE OP Deposit, as of 30 September 2024 ....................................... 61
Table 10-3: Key Parameters of Mineral Resources Estimate (DSW OP) ................................................................. 62
Table 10-4: Mineral Resource Statement of DSW OP Deposit, as of 30 September 2024 ...................................... 62
Table 10-5: Key Parameters of Mineral Resources Estimate (NKW OP) ................................................................. 62
Table 10-6: Mineral Resource Statement of NKW OP Deposit, as of 30 September 2024 ...................................... 63
Table 10-7: Key Parameters of Mineral Resources Estimate (NLU OP) .................................................................. 64
Table 10-8: Mineral Resource Statement of NLU OP Deposit, as of 30 September 2024 ....................................... 64
Table 10-9: Key Parameters of Mineral Resources Estimate (MAI OP) ................................................................... 65
Table 10-10: Mineral Resource Statement of MAI OP Deposit at Far West Mine, as of 30 September 2024 ........... 65
Table 10-11: Key parameters of Mineral Resources estimate (NON) ......................................................................... 66
Table 10-12: Mineral Resource Memorandum of Ban Non Open Pit Deposit at Far West Mine, as of 30
September 2024 ..................................................................................................................................... 66
Table 10-13: Key Parameters of Mineral Resources Estimate (NAK OP) .................................................................. 67
Table 10-14: Mineral Resource Statement of NAK OP Deposit at Far West Mine, as of 30 September 2024 .......... 67
Table 10-15: Mineral Resource Statement of TKM OP Deposit, as of 30 September 2024 ....................................... 68
Table 10-16: Key Parameters of Mineral Resources Estimate (DSE UG) .................................................................. 68
Table 10-17: Mineral Resource Statement of DSE UG Deposit, as of 30 September 2024 ....................................... 69
Table 10-18: Key Parameters of Mineral Resources Estimate (DSW UG) ................................................................. 69
Table 10-19: Mineral Resource Statement of DSW UG Deposit, as of 30 September 2024 ...................................... 70
Table 10-20: Mineral Resource Statement of KHN UG Deposit, as of 30 September 2024 ....................................... 70
Table 10-21: Mineral Resource Statement of Gold Stockpile, as of 30 September 2024 ........................................... 71
Table 10-22: Mineral Resource Statement of Copper Stockpile, as of 30 September 2024 ...................................... 72
Table 10-23: Mineral Resource Estimate of Total Gold, as of 30 September 20241 .................................................. 72
Table 10-24: Mineral Resource Estimate of Total Copper, as of 30 September 2024 1 ............................................. 73
Table 11-1 Unit Operating Cost of Open Pit Gold Mining ........................................................................................ 77
Table 11-2: Gold Cut-off Grade Calculation .............................................................................................................. 77
Table 11-3: Key Parameters of Ore Reserves Estimate (DSE OP) .......................................................................... 79
Table 11-4: Ore Reserves Estimate of DSE OP Deposit, as of 30 September 2024 1, 3, 4 ........................................ 79
Table 11-5: Key Parameters of Ore Reserves Estimate (DSW OP) ......................................................................... 81
Table 11-6: Ore Reserves Estimate of DSW OP Deposit, as of 30 September 20241, 3, 4 ........................................ 81
Table 11-7: Key Parameters of Ore Reserves Estimate (NMK OP) ......................................................................... 83
Table 11-8: Ore Reserves Estimate of NMK OP Deposit, as of 30 September 20241, 3, 4 ........................................ 83
Table 11-9: Key Parameters of Ore Reserves Estimate (NLU OP) .......................................................................... 85
– IIIB-9 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Table 11-10: Ore Reserves Estimate of NLU OP Deposit, as of 30 September 20241, 3, 4 ......................................... 85
Table 11-11 Summary of Gold Production and Operating Cost ................................................................................. 87
Table 11-12: Gold Cut-off Grade Calculation .............................................................................................................. 87
Table 11-13: Key Parameters of Stope Optimization .................................................................................................. 88
Table 11-14:Modifying Factors Used for Ore Reserves Estimation ........................................................................... 89
Table 11-15: Estimates Process Summary ................................................................................................................. 91
Table 11-16: Ore Reserves Estimate of DSE UG Deposit, as of 30 September 20241, 3 ........................................... 92
Table 11-17 Summary of Copper Production Cost .................................................................................................... 93
Table 11-18: Copper Cut-off Grade Calculation .......................................................................................................... 94
Table 11-19: Ore Reserves Estimate of Gold Stockpile, as of 30 September 2024 1, 3, 4, 5 ......................................... 94
Table 11-20: Ore Reserve Estimate of Copper Stockpile, as of 30 September 2024 1, 3, 4, 5 ...................................... 95
Table 11-21: Production Schedule of LXML ................................................................................................................ 95
Table11-22 Ore Reserves Estimate of Gold Minerals in Total, as of 30 September 2024 1, 3,4, 5 .............................. 96
Table 11-23 Ore Reserves Estimate of Copper Minerals, as of 30 September 2024 1, 3, 4, 5 ...................................... 97
Table 12-1: Production Records of LXML ................................................................................................................. 99
Table 12-2: Summary of Drill Holes for 2007 and 2018 Drilling Campaigns ........................................................... 101
Table 12-3: Rock Mass Parameters Used for Geotechnical Analysis by Mining One ............................................ 102
Table 12-4: Mine Design Parameters ...................................................................................................................... 103
Table 12-5: Rationalised Slope Design Parameters ............................................................................................... 103
Table 12-6: Waste Dumps and Stockpile Design Parameters ................................................................................ 104
Table 12-7: Open-pit Mining Equipment .................................................................................................................. 105
Table 12-8: Diamond Drill Holes Used to Construct Geotechnical Model ............................................................... 106
Table 12-9: Q’ Statistical Analysis for Each Domain ............................................................................................... 106
Table 12-10: Lateral Development Profiles ............................................................................................................... 107
Table 12-11: Lateral Development Profiles ............................................................................................................... 108
Table 12-12: Owner’s Underground Mining Equipment Quantity .............................................................................. 110
Table 13-1: Sepon Gold Plant Historical Production Performance ......................................................................... 116
Table 13-2: Sepon Gold Plant Consumable ............................................................................................................ 118
Table 13-3: Sepon Copper Plant Historical Production Performance ..................................................................... 124
Table 13-4: Sepon Copper Plant Consumable ........................................................................................................ 125
Table 14-1: Accesses to Sepon Project .................................................................................................................. 131
Table 16-1: OHS Incident Statistics......................................................................................................................... 139
Table 17-1: Three Year Investment Plan Proposed by LXML ................................................................................. 141
Table 17-2: LXML Sustaining Capital Expenditures from 2021 to 2023 ................................................................. 141
Table 17-3: LXML Unit Sustaining Capex from 2021 to 2023 ................................................................................. 141
Table 17-4: Further Capex needed for LXML as of 30 September 2024 ................................................................ 142
Table 17-5: Operating Costs in 2021, 2022, 2023 and 2024 Q1- Q3 ..................................................................... 142
Table 17-6: Operating Costs Forecast of LXML ...................................................................................................... 144
Table 17-7: Forecasted Gold and Copper Prices by SRK in the 3rd Quarter of 2024 ............................................. 146
Table 18-1: Taxes and Surcharges Assumption ..................................................................................................... 148
Table 18-2: Technical and Economic Parameters .................................................................................................. 149
Table 18-3: NCF Calculation ................................................................................................................................... 152
Table 18-4: NPV Projections ................................................................................................................................... 153
Table 18-5: Sensitivity Study of NPV (at 10% Discount Rate, in USD Million) ....................................................... 154
Table 20-1: Project Risk Assessment of the Sepon Project ..................................................................................... 160

Figures
Figure 4-1: Location of Sepon Project ...................................................................................................................... 13
Figure 4-2: Monthly Temperatures and Precipitations in the Project Area ............................................................... 14
– IIIB-10 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Contents    Final
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Figure 6-1: Regional Geology Setting ...................................................................................................................... 16
Figure 6-2: Local Geology Setting ............................................................................................................................ 17
Figure 6-3: Sepon Stratigraphy Log ......................................................................................................................... 20
Figure 6-4: Sepon Carbonate Basin and Mineralization Types ................................................................................ 22
Figure 6-5: Relationship between magmatic rock bodies and mineralization types ................................................. 23
Figure 6-6: Schematic Cross-Section showing Relationship between magmatic r ock bodies and
mineralization types of Sepon Project .................................................................................................... 24
Figure 7-1: Drilling Programs completed in Sepon Project by December 2022 ....................................................... 28
Figure 7-2: Exploration Programs completed in Sepon Project in 2021................................................................... 29
Figure 7-3: Exploration Programs completed in Sepon Project in 2022................................................................... 29
Figure 7-4: Trenches used in the exploration in Sepon Project ............................................................................... 30
Figure 7-5: Drill rigs used in the exploration in Sepon Project ................................................................................. 30
Figure 7-6: Field and Lab Duplicate Au Ag and Cu Plot of Control Sample Programme ......................................... 35
Figure 7-7: Performance of standards of Sepon ...................................................................................................... 37
Figure 7-8: Performance of blanks of Sepon ............................................................................................................ 41
Figure 8-1: Au Comparison with Re-assay by SRK and Original Assay from Sepon for Drilling Cores .................. 47
Figure 8-2: Black Colour Carbonate Hosted Carlin Type Au Mineralization at Discovery West A2 Pit ................... 49
Figure 8-3: Skarn Type Cu Mineralization at Slope Wall of TKN A Pit ..................................................................... 49
Figure 8-4: Hydrothermal Cu-Au Mineralization in the Intrusive ............................................................................... 49
Figure 9-1: Sepon Primary Ore Flotation Response ................................................................................................ 53
Figure 9-2: Part of Test Devices in Sepon Metallurgical Laboratory ........................................................................ 54
Figure 10-1: Plan view of LXML Mineral Resource Deposits ..................................................................................... 59
Figure 10-2: Year(Quarter)-end Map, Dated on 30 September 2024 ........................................................................ 60
Figure 11-1: Relationship Between Mineral Resources and Ore Reserves ............................................................... 74
Figure 11-2: Plan View of Ore Deposits to Estimate Ore Reserves ........................................................................... 75
Figure 11-3: Comparison between Month-end Status and Final Open Pit Design for DSE OP ................................ 78
Figure 11-4: Comparison between Month-end Status and Final Open Pit Designs for DSW OP .............................. 80
Figure 11-5: Comparison between Month-end Status and Final Open Pit Designs for NMK OP .............................. 82
Figure 11-6: Comparison between Month-end Status and Final Open Pit Designs for NLU OP ............................... 84
Figure 11-7 DSE UG Underground Site Visiting Photos ........................................................................................... 86
Figure 11-8: Underground Design for DSE UG .......................................................................................................... 87
Figure 11-9:Stope Optimization Results ..................................................................................................................... 89
Figure 11-10:Overbreak and Underbreak Analysis .................................................................................................... 90
Figure 11-11:Stope Performance Summary ............................................................................................................... 90
Figure 11-12:Estimates Process - Change in Tonne .................................................................................................. 91
Figure 11-13:Estimates Process - Change in Metal Contained ................................................................................. 92
Figure 12-1: Far West Area and DSW UG Exploration Field ................................................................................... 100
Figure 12-2: Isometric View of Concept Design (LHSP, looking south) ................................................................... 107
Figure 12-3: Primary Ventilation Layout ................................................................................................................... 110
Figure 12-4: Revised Primary Ventilation Layout ..................................................................................................... 111
Figure 12-5: Secondary Fan in Main Decline ........................................................................................................... 111
Figure 12-6: Primary Ventilation Survey in January 2024 ........................................................................................ 112
Figure 13-1: Sepon Gold Plant and Copper Plant Complex ..................................................................................... 114
Figure 13-2: Simplified Gold Recovering Flowchart ................................................................................................. 114
Figure 13-3: Facilities of Sepon Gold Plant .............................................................................................................. 117
Figure 13-4: Schematic Diagram for Copper Hydrometallurgical Recovery ............................................................ 119
Figure 13-5: Simplified Copper Metallurgical Flow Chart ......................................................................................... 120
Figure 13-6: Workshops of Copper Plant ................................................................................................................. 125
Figure 14-1: WTSF and Extension ........................................................................................................................... 130
Figure 14-2: Location and Access to Sepon Project ................................................................................................ 130
Figure 17-1: Gold and Copper 5 Years Historic Price .............................................................................................. 145
Figure 17-2: Gold and Copper Price Forecast .......................................................................................................... 146
– IIIB-11 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Figure 18-1: Gold Production Schedule ................................................................................................................... 150
Figure 18-2: Copper Production Schedule ............................................................................................................... 150
Figure 18-3: Annual Capex over the LoM ................................................................................................................. 151
Figure 18-4: Annual Opex over the LoM .................................................................................................................. 152
Figure 18-5: Annual Net Cash Flow.......................................................................................................................... 153
Figure 18-6: NPV (at 10%) Vs.  Gold Price or Copper Price or Opex ...................................................................... 154

Appendices
Appendix A Copy of the Mining License
Appendix B JORC Table 1
Appendix C Compliance with Chapter 18
Appendix D Chapter 2.6 of the Guide for New Listing Applicants





– IIIB-12 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
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Useful Definitions    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xiii
Useful Definitions
This list contains definitions of symbols, units, abbreviations, and terminology that may be unfamiliar to the reader.
Abbreviation Terminology
' minute of arc
% percent/percentage
/ per
° degree(s) of arc
°C degree(s) Centigrade
3D three-dimensional
AER Annual Environmental Report
Ag The chemical symbol for silver
AN/FO ammonium nitrate/fuel oil
ARD acid rock drainage
As The chemical symbol for arsenic
ASL above sea level
Au The chemical symbol for gold
AusIMM Australasian Institute of Mining and Metallurgy
B.Eng. Bachelor of Engineering
B×H breadth × height
BD bulk density
Capex capital cost
CCD counter current decantation
Chifeng Gold Chifeng Jilong Gold Mining Co., Ltd.
Client Chifeng Gold
cm centimetre(s)
Conc. Concentrate
CP Competent Person
CPI consumer price index
CPR Competent Person’s Report
CIL carbon in leach
CRF cemented rock fill
CSV comma-separated values
Cu The chemical symbol for copper
Cut-off grade
The grade threshold above which a mineral material is considered potentially economic and is
selectively mined and processed as ore
CuSO4 copper sulphate
CV Coefficient of Variation
DA depreciation and amortization
m/s meter(s) per second
DCF discounted cash flow
Dr. Doctor of Philosophy
ECAP Environmental Corrective Action Plan
EIA The Environmental Impact Assessment
EPMP Environmental Protection and Management Plan
– IIIB-13 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Useful Definitions    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xiv
Abbreviation Terminology
ESHS Environmental, Social, Health and Safety
etc. et cetera (= and so on)
FAusIMM Fellow of the AusIMM
Fe The chemical symbol for iron
FS feasibility study report
g gram(s)
g/t gram(s) per tonne
GPS global positioning system
GRG gravity recoverable gold
ha hectare(s)
HKEx or the Stock
Exchange
The Stock Exchange of Hong Kong Limited
HQ core core diameter of 63.5mm
POX concentrate pressure oxidation
i.e. id Est (= that is)
ID5 inverse distance power of 5
IFC International Finance Corporation
Indicated Mineral
Resource
An Indicated Mineral Resource is that part of a mineral resource for which tonnage, densities, shape,
physical characteristics, grade and mineral content can be esti mated with a reasonable level of
confidence.  It is based on exploration, sampling and testing 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
Inferred Mineral
Resource
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
assumed but not verified geologi cal and/or grade continuity.  I t is based on information gathered
through appropriate techniques from locations such as outcrops,  trenches, pits, workings, and drill
holes which may be limited or of uncertain quality and reliability
Intertek Intertek Laboratory in Beijing
IP
Induced Polarisation, which is an exploration technique whereby an electrical current is pulsed through
the ground and the response from  the sub surface measured in or der to identify minerals of interest.
Strong IP responses may be a result of sulphide which may be associated with gold mineralisation
IPO Initial Public Offering
IRR internal rate of return
JORC Code
Australasian Code for Reporting of Exploration Results, Mineral  Resources and Ore Reserves, 2012
edition, as published by the Joint Ore Reserves Committee.
JORC Committee
Joint Ore Reserves Committee of  The Australasian Institute of M ining and Metallurgy, Australian
Institute of Geoscientists and Minerals Council of Australia
kg kilogram(s), equivalent to 1,000 grams
kg/t kilogram(s) per tonne
km kilometre(s), equivalent to 1,000 metres
km2 square kilometre(s)
kt Thousand tonne(s)
ktpa Thousand tonne(s) per annum
kV kilovolt(s)
kW kilowatt(s)
kWh/t kilowatt(s) hour per tonne
Laos Lao People’s Democratic Republic
– IIIB-14 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Useful Definitions    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xv
Abbreviation Terminology
L×B×H length × breadth × height
LHD load-haul-dump machine
LoM life of mine
LXML Lane Xang Minerals Limited Company, a subsidiary of Chifeng Gold
m meter(s)
M Million(s)
m ASL meter(s) above sea level
M.Eng. Master of Engineering
M.Sc. Master of Science
m/kt meter(s) per kilo tonne
m2 square metre(s)
m3 cubic metre(s)
m3/d cubic meter(s) per day
m3/s cubic meter(s) per second
m3/t cubic meter(s) per tonne
m3/year cubic meter(s) per year
MAusIMM Member of the AusIMM
Measured Mineral
Resource
A Measured 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 explorat ion, sampling and testing info rmation gathered through appropriate
techniques from locations such as outcrops, trenches, pits, workings and drill holes
Mineral Resources
A concentration or occurrence of material of intrinsic economic interest in or on the earth’s crust in such
form, quality and quantity that there are reasonable prospects for eventual economic extraction, as
defined in JORC Code.  The loca tion, quantity, grade, geologica l characteristics and continuity of a
mineral resource are known, estimated or interpreted from specific geological evidence and knowledge
mg/l milligram(s) per litre
mg/m3 milligram(s) per cubic metre
mm millimetre(s)
Mn The chemical symbol for manganese
Mo The chemical symbol for molybdenum
Moz Million ounce(s)
Projects Sepon Gold and Copper Projects
Mr. Mister
Mt Million tonne(s)
Mtpa Million tonne(s) per annum
MW Megawatt(s), equivalent to 1,000,000 watts
NCF net cash flow
Ni The chemical symbol for nickel
NPV net present value
NQ core core diameter of 47.6mm
O.K. Ordinary Kriging
OHS occupational health and safety
Opex operating cost
Ore Reserves
The economically mineable part of a Measured and/or Indicated mineral resource.  It includes diluting
materials and allowances for losses which may occur when the material is mined.  Appropriate
assessments and studies have been carried out including consideration of and modification by
realistically assumed mining, processing, metallurgical, infrastructure, economic, marketing, legal,
– IIIB-15 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Useful Definitions    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xvi
Abbreviation Terminology
environmental, social and government factors, as defined in the JORC definition standards.  These
assessments demonstrate at the time of reporting that extraction could reasonably be justified.  Ore
Reserves are sub-divided in order of increasing confidence into Probable Ore Reserves and Proved
Ore Reserves
oz Ounce
Pb The chemical symbol for lead
pH hydrogen ion concentration
Ph.D. Doctor of Philosophy
ppb part(s) per billion
PRC People’s Republic of China
Probable Ore
Reserve
A Probable Ore Reserve is the economically mineable part of an Indicated, and in some circumstances
Measured Resource.  It includes diluting materials and allowanc es for losses which may occur when
the material is mined.  Appropriate assessments, which may incl ude feasibility studies, have been
carried out including consideration of and modification by real istically assumed mining, processing,
metallurgical, infrastructure, economic, marketing, legal, environmental, social and governmental
factors.  These assessments demonstrate at the time of reporting that extraction could reasonably be
justified
Proved Ore Reserve
(or Proved Ore
Reserve)
A Proved Ore Reserve is the economically mineable part of a Measured Resource.  It includes diluting
materials and allowances for losses which may occur when the ma terial is mined.  Appropriate
assessments, which may include feasibility studies, have been c arried out, and include consideration
of and modification by realistically assumed mining, processing, metallurgical, infrastructure, economic,
marketing, legal, environmental, social and governmental factors.  These assessments demonstrate at
the time of reporting that extraction could reasonably be justified.
QA/QC Quality Assurance / Quality Control
QMS Quality Management System
Report Competent Person’s Report
RMB Renminbi, which is the official currency of the People's Republic of China.
RMB/a RMB per annum
RMB/g RMB per gram
ROM run-of-mine
RTK real-time kinematic
S The chemical symbol for sulphur
SBX Sodium butyl xanthate
SD standard deviations
SG specific gravity
SRK SRK Consulting China Ltd trading as SRK Consulting
t tonne(s), equivalent to 1,000kg
t/h tonne(s) per hour
t/m3 tonne(s) per cubic meter
TFe Total iron, including magnetic and non-magnetic iron
tpa tonne(s) per annum
tpd tonne(s) per day
tph tonne(s) per hour
TSF tailings storage facility
TSX Toronto Stock Exchange
USD United States Dollar
V The chemical symbol for vanadium
– IIIB-16 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Useful Definitions    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xvii
Abbreviation Terminology
Valmin Code
Australian Code for Public Reporting of Technical Assessment and Valuation of Mineral and Petroleum
Assets and Securities used in Independent Expert Reports
VAT value-added tax
WRD waste rock dump
WSCP Water and Soil Conservation Plan
Zn The chemical symbol for zinc
μm micron(s), 1/1,000 of a millimetre




– IIIB-17 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


--- page 1295 ---
Competent Person's Report for the Sepon Gold and Copper Project, Lao People's Democratic Republic
Useful Definitions    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xviii
Executive Summary
SRK Consulting China Ltd.(“SRK”) was requested by Chifeng Jilong Gold Mining Co., Ltd. (“Chifeng
Gold” or the “Client”) to prepare a Competent Person’s Report (“CPR” or the “Report”) for its Sepon
Gold and Copper Projects (the “the Projects”) located in Savannakhet Province, Lao People’s
Democratic Republic (“Laos”) in accordance with guidelines of the Australasian Code for Reporting
Exploration Results, Mineral Resources and Ore Reserves, 2012 edition (“JORC Code (2012)”) and
the Rules Governing the Listing of Securities on The Stock Exch ange of Hong Kong Limited
(“HKEx”), including the Chapter 18 requirements (Appendix C), Chapter  2.6 of the Guide for New
Listing Applicants (Appendix D)  and other relevant regulations of the Exchange and Hong Kong
Exchanges and Clearing Ltd (“HKEx”). The projects include explo ration licenses, mining licenses,
currently operating open-pit mines, and associated ore processing and metallurgic plants, as well as
an underground mine, and various defined deposits with gold, co pper and rare earth elements
(“REE”) mineral resources (the REE project will be reported in a sep arate report). The projects are
currently operated by Lane Xang Minerals Limited Company (“ LXML”), which is a subsidiary of
Chifeng Gold.
This Report consists of an independent review of the geology, e xploration, mineral resources, Ore
Reserves, mining, mineral processing and smelter-refinery, capi tal investment, operating cost, and
environmental and social aspects of the Projects.
Outline of Work Program
The geological models for the Projects were constructed and provided to SRK by Chifeng Gold.  In
SRK’s opinion, the geological models are a reasonable represent ation of the distribution of the
targeted mineralisation at the current level of sampling.  The models were reviewed and updated by
SRK from December 2022 to January 2023, as well as in January and June 2024.
Based on the Mineral Resource statements and models and the studies and mine designs provided
by LXML and third parties, SRK rescheduled the production profile and converted parts of the Mineral
Resources into Ore Reserves.
During the period from 9 December 2022 to 14 December 2022, SRK ’s personnel conducted site
visits to the Sepon Project, inspected and observed the status of the operation at that time, held
meetings with the managements an d technical personnel of LXML, sighted geology, exploration,
mineralization, mining operation, ore processing and metallurgic operation, as well as their own data
verification programs. SRK team also conducted additional site visits in December 2023 and May
2024, respectively, inspecting mi ning, ore processing and smelt er, and environmental and social
aspects.
SRK team reviewed the information provided by LXML and compiled a technical report according to
JORC (2012) technical report form, and submitted it to the client for comments in January 2023, and
late submitted a memo of updating Mineral Resources and Ore Reserves as of 31 December 2023.
From May to June 2024, SRK further conducted site visits, and u pdated the report as of 30
September 2024.
– IIIB-18 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Useful Definitions    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xix
SRK will update the Competent Person’s Report (CPR) as and when the company requires updates,
ensuring that the content remains accurate and up-to-date in li ght of relevant circumstances and
feedback.
Results
Overall
The Sepon project area located in Savannakhet province, south-central Laos is an operating mine
with open-pit and underground mining and facilities to process gold and copper ores to produce gold
bars and cathode copper plates since 2003. After acquired the p roject in 2018, Chifeng Gold has
conducted a lot of exploration programs to look for and define mineral resources to maintain the
production and extend the mine life.  As of 30 September 2024, by reviewing Sepon’s exploration
data and resource models, SRK reports the remaining mineral resources as classified as open-
pitable gold, underground gold, and low grade copper as shown in Table ES- 1.
Table ES- 1: Summary of Remaini ng Mineral Resources of Sepon Project as of 30 September 2024
Type Category Tonnage
(kt)
Au Grade
(g/t)
Au Metal
Contained
(t)
Au Metal
Contained
(koz)
Cu
Grade
(%)
Cu Metal
Contained
(kt)
Gold
Measured 276  7.98  2.21 71 -
Indicated 7,220 4.13 29.80 958 -
Mea+Ind 7,496 4.27 32.00 1,029 -
Inferred 6,002  3.67  22.00 707 -
Low Grade
Copper
Measured - -  - -
Indicated 4,416 - - 1.45 64.20
Inferred 2,078 -  - 0.98 20.46
Sepon mine’s technical personnel conducted various studies and designed the mining production for the next
few years to mine part of above  resources.  By reviewing Sepon mine’s data and models, SRK
reports the Ore Reserves as of 3 0 September 2024, classified as  surface mining Gold and
underground mining Gold, and surface mining Copper as shown in Table ES- 2.
Table ES- 2: Summary of Remaining Ore Reserves of Sepon Project as of 30 September 2024
SRK reviewed the production schedule planned by Sepon mine, inc luding three years of surface
mining and seven years of underground mining, as well as processing, and the economic parameters
proposed by the Sepon mine, such as capital expenditures (“ Capex”) and operating expenses
(“Opex”) in next few years.  By using the parameters and the products ’ prices forecasted by SRK,
SRK conducted an economic analysis by using discount cashflow method (“DCF”), and the analytical
Type Sub-Type Category Tonnage
(kt)
Au Grade
(g/t)
Cu Grade
(%) Note
Surface
mining
Open-pit Gold
Proved  31   1.03  - Included in
Resources Probable  2,175   1.87  -
Total  2,206  1.86
Stockpile Gold Proved - - -
Included in
Resources
Probable 2,185 2.61 -
Stockpile
Copper
Proved - - -
Probable 1,185 - 0.93
Underground Mining Gold
Proved 237 5.18  Included in
ResourcesProbable 3,268 4.14 -
Total 3,505 4.21 -
– IIIB-19 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Useful Definitions    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xx
results show that the operations of surface mining and undergro und mining as well as processing
are economically viable without considering recovering the sunken capital invested.
Operational Licenses and Permits
SRK has sighted the business license and mining license. The la nd use is mainly governed by a
Mineral Exploration and Production Agreement (“MEPA”) concessio n from the Lao Government,
combined with land compensation with the communities impacted by the Project. The Company has
compensated the impacted residents entitled for the land use accordingly.
Property Description and Ownership
LXML possesses a mining permit with a total area of 116.96 km2, that is valid till 29 September 2033.
According to the Company, additional mining licensed area of 17 .65 km2 has been extended, and
therefore the total mining license area has been increased from  99.31 km 2 to 116.96 km 2. LXML
possesses an exploration permit with a total area of 996.12 km 2, that is valid till June 2026.    The
exploration permit consists of 66 inflection points.
Geology and Mineralization
Mineralization styles of the S epon district can be classified a s an intrusion-centred hydrothermal
system with the majority of known Cu and Au mineralization spatially associated with the Padan and
Thengkham porphyry centres. Mineralisation typically displays a zoned pattern in both mineralization
type and metal content. Porphyry M o-Cu systems occur at the cor e zoning outward through skarn
and carbonate replacement Cu deposits to the Au dominated sediment-hosted systems which show
Carlin type of deposit characteri stics. Pb-Zn mineralization oc curs distal to the porphyry’s contact
metamorphic aureole in a sediment-hosted setting, though a genetic link is yet to be confirmed.
Three major controls on the distribution of gold and copper min eralization in the Sepon Basin have
been identified. The primary control is understood to be the po rphyry centres around which there is
a metal zonation. Secondary control is the structural architecture (faults and folds). In the case of Au
mineralisation there seems to be a strong (third order) litholo gical control where gold dominantly
occurs along or close to the Nalou-Discovery formation contact which acts as a favourable receptive
region.
Exploration Status
The first campaign was greenfields exploration drilling. This d rilling was completed by RTZ during
the 1990s. Oxiana continued to u se the drilling and sampling pr otocols developed by RTZ after
acquiring the project.
In May 2006 the Sepon site adopted a policy of requiring no wet RC drilling of mineralised zones. If
wet RC sample was encountered the hole was stopped. A total of 1,321,787m of diamond drilling
(“DD”) and reverse circulation (“RC”) drilling data are contained in the resource database. Of this,
85% is geologically logged, and 98% of sampled intervals contai n gold and copper assays (15% of
the RC data were assayed but not logged).
– IIIB-20 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Useful Definitions    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xxi
Only samples within the mineralisation or geological domains are used in the estimations. A total of
1,503 diamond holes (100,582.5m), 2,840RC drill holes (170,825.6m) and 13,661 grade control RC
holes (202,618.3m) were used to create the Nalou block model.
A total of 1,022 DD (117,495m), 2,3732 RC (no Grade Control) (1 75,499.2m) RC drill holes and
45,635 RC Grade Control holes (764,831.8m) for a total of 1,057 ,826m were used to create the
Discovery region block model.
After Chifeng Gold took over the Sepon project, the exploration programs focused on discovering
new gold deposits in brownfields to supply the processing plant and keep on the production, as well
as discovering new types of mineralization in greenfields.
Mineral Resource and Estimates
SRK has used the datasets made available by LXML, as well as th e findings from the previous
Mineral Resource Technical Report from LXML. The basic model was prepared by LXML in Vulcan
and leapfrog using conventional 3D block modelling and OK estim ation techniques. SRK reviewed
the process of grade interpolati on in historical reports. Based on the current stope topography in
September 2024, SRK reported the Mineral Resource within the open pit and underground.
The Sepon gold and copper deposits possess the Mineral Resources as  shown in Table ES- 3 gold,
in Table ES- 4 for the copper mineral resources.
Table ES- 3: Sepon Gold Mineral Resources as of 30 September 20 24 1
Type Category Tonnage Au Grade Au Metal Contained Au Metal Contained
(kt)2 g/t t koz
Oxide
Measured 29 1.05 0.03 1
Indicated 1,981 1.47 2.91 94
MES+IND3 2,010 1.46 2.94  95
Inferred 2,836 1.50 4.25 137
Primary
Measured 247 8.80 2.17 70
Indicated 5,239 5.13  26.89 864
MES+IND3 5,486 5.30 29.06  934
Inferred 3,166 5.61 17.76 571
Total
Measured 276 7.98 2.21  71
Indicated 7,220 4.13 29.80  958
MES+IND3 7,496 4.27  32.00 1,029
Inferred 6,002 3.67 22.00 707
Sources: SRK
Notes:
1 The information relates to Mineral Resource conversion is based  on information compiled by Mr. Liang Li, MAusIMM, and
Dr. Anshun Xu, FAusIMM, employees  of SRK Consulting China Ltd. Both Dr. Xu and Mr. Li have sufficient experience
relevant to the style of mineralisation and type of deposit under consideration and to the activity which they are undertaking
to qualify as Competent Persons as defined in JORC (2012).  Dr. Xu supervised the work of Mr. Li.  Both Dr. Xu and Mr. Li
consent to the reporting of this information in the form and context in which it appears.
2 Total may not add due to rounding discrepancies.
3 MES+IND: combined measured and Indicated Mineral Resource.
4 The cut-off grade depends on ore type (Otyp) and mining method. For open pit mining and gold stockpiles, the cut-off grade
of oxide ores is 0.6 g/t, the cut-off grade of primary ores is 1.5 g/t. For Underground mining, the cut-off grade of primary
ores is 2.3 g/t.
– IIIB-21 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Useful Definitions    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xxii
Table ES- 4: Mineral Resource Estimate of Total Copper, as of 3 0 September 2024 1
Type Category
Tonnage Cu Grade Cu Metal Contained
(kt)2 (%) (kt) 2
Oxide
Measured - - -
Indicated 1,367 0.93 12.74
MES+IND3 1,367 0.93 12.74
Inferred 855 1.89 16.16
Primary
Measured - - -
Indicated 3,049 1.69 51.47
MES+IND3 3,049 1.69 51.47
Inferred 1,222 1.59 19.37
Total
Measured - - -
Indicated 4,416 1.45 64.20
MES+IND3 4,416 1.45 64.20
Inferred 2,078  0.98   20.46
Sources: SRK
Notes:
1 The information relates to Mineral Resource conversion is based  on information compiled by Mr. Liang Li, MAusIMM, and
Dr. Anshun Xu, FAusIMM, employees  of SRK Consulting China Ltd. Both Dr. Xu and Mr. Li have sufficient experience
relevant to the style of mineralisation and type of deposit under consideration and to the activity which they are undertaking
to qualify as Competent Persons as defined in JORC (2012).  Dr.  Xu supervised the work of Mr. Li. Both Dr. Xu and Mr. Li
consent to the reporting of this information in the form and context in which it appears.
2 Total may not add due to rounding discrepancies.
3 MES+IND: combined measured and Indicated, Mineral Resource.
4 The cut-off grade depends on ore type (Otyp) and mining method.  For open pit mining and copper stockpiles, the cut-off
grade of oxide ores is 0.7% Cu, the cut-off grade of primary ores is 0.3% Cu. For Underground mining, the cut-off grade of
primary oxide ores is 0.8% Cu.
Ore Reserve Estimates
The gold deposits that are being or to be exploited include DSE  OP, DSW OP, NLU OP, NMK OP,
Far West Area (Including MAI OP, NON OP, NKN OP), DSE UG, DSW U G. The copper deposits
that are being or to be exploited include KHN UG, TKM OPs.
Among these gold and copper deposits, only DSE OP, DSW OP, NLU OP, NMK OP, DSE UG, and
KHN UG possess Measured and Indicated Mineral Resources. Additionally, KHN UG is currently in
the feasibility study stage. Consequently, open-pit gold mines including DSE OP, DSW OP, NLU OP
and NMK OP could be converted to Ore Reserves from their Minera l Resources. For underground
gold mines, only DSE UG would be considered for estimating Ore Reserves. None of the copper
deposits would be considered for estimating Ore Reserves.
SRK was provided with the SGPS revised on 18 March 2020.  Miner al resource models, final open
pit designs and underground mining study have been updated by LXML since completion of SGPS.
The changes make it necessary relying on both SGPS and updates to estimate Ore Reserves.
The updated block models were applied by SRK to estimate mineable materials.  The updated open
pit designs have been applied by the LXML to guide mining bound aries for open pit mining.  It is
technically feasible to report Ore Reserves in Table ES- 5 for open pit mining (gold).
– IIIB-22 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Useful Definitions    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xxiii
Table ES- 5: Ore Reserve Stateme nt for Open Pit Mining, as of 30 September 2024 1, 3, 4
Type Category Tonnage Au Grade Au Metal
Contained
Au Metal
Contained
(kt) (g/t) (t) (koz)
DSE OP
Oxide Proved  -     -     -     -
 Probable 482 1.50 0.72  23
 Sub-total  2  482   1.50   0.72   23
Primary Proved -   -    -    -
 Probable  -     -     -     -
 Sub-total  2 -   -    -    -
Total 2 Proved -   -    -    -
 Probable  482   1.50   0.72   23
 Total 482 1.50 0.72  23
DSW OP
Oxide Proved  -     -     -     -
 Probable 12 0.95 0.01  0.4
 Sub-total2  12   0.95   0.01   0.4
Primary Proved -   -    -    -
 Probable  18   6.87   0.12   4
 Sub-total  2 18 6.87 0.12  4
Total 2 Proved  -     -     -     -
 Probable 30 4.52 0.14  4
 Total  30   4. 52   0.14   4
NMK OP
Oxide Proved  30   0.97   0.03   1
 Probable 1,030 1.20 1.24  40
 Sub-total2  1,060   1.19   1.26   41
Primary Proved 1 2.59 0.00  0
 Probable  263   3.19   0.84   27
 Sub-total  2 264 3.19 0.84  27
Total 2 Proved  31   1. 03   0.03   1
 Probable 1,294 1.60 2.08  67
 Total  1,324   1. 59   2.11   68
NLU OP
Oxide Proved -   -    -    -
 Probable  73   1.17   0.09   3
 Sub-total2 73 1.17 0.09  3
Primary Proved  -     -     -     -
 Probable 297 3.56 1.06  34
 Sub-total  2  297   3.56   1.06   34
Total 2 Proved -   -    -    -
 Probable  370   3.09   1.14   37
 Total 370 3.09 1.14  37
Grand total
Oxide Proved 30 0.97 0.03  1
 Probable  1,598   1.29   2.05   66
 Sub-total  2 1,627 1.28 2.08  67
Primary Proved  1   2.59   0.003   0.1
 Probable 578 3.50 2.02  65
 Sub-total  2  579   3.49   2.02   65
Total 2 Proved 31 1.03 0.03  1
 Probable  2,175   1.87   4.07   131
 Total 2,206 1.86 4.11  132
Sources: SRK
Notes:
1 The information relates to Ore Reserve conversion is based on i nformation compiled by Mr. Erwei Lu and Mr. Yonggang
Wu and Dr. Anshun Xu, FAusIMM, employees of SRK Consulting Chin a Ltd. Mr. Lu, Mr. Wu and  Dr. Xu have sufficient
experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which Mr. Wu
is undertaking to qualify as Competent Person as defined in JOR C (2012).  Mr. Wu and Dr. Xu supervised the work of Mr.
– IIIB-23 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Lu. Mr. Wu, Mr. Lu and Dr. Xu consent to the reporting of this information in the form and context in which it appears. Totals
may not add due to rounding discrepancies.
2 Mining dilution is 7.5% and mining loss is 5%.
3 The Ore Reserves in the table are included in the Mineral Resources. They should not be added to the Mineral Resources.
4 The Ore Reserves Statement is based on the depletion data provided by LXML for the six-month period, 1 April 2024 to 30
September 2024. The reported LXML data may differ from that rep orted by SRK, due the updated block model now used
by LXML for reporting. SRK considers this updated block model t o be more representative of actual production conditions
and has therefore adopted the LXML provided data as the basis for this statement.
Besides of deposits being or to be exploited, there are stockpiles on site for buffering and supplying
ores to the processing plant.  Probable Ore Reserves were repor ted for those available stockpiles
with detailed and good tracking records.  The results are shown in Table ES- 6 and Table ES- 7.
Table ES- 6: Ore Reserve Stateme nt of Gold Stockpiles, as of 30 September 2024 1, 2,3, 4
Type Category Tonnage
(kt)
Au Grade
(g/t)
Au Metal
Contained
(t)
Au Metal
Contained
(koz)
Oxide Proved -   -    -    -
 Probable  361   1.91   0.69   22
 Sub-total 2 361 1.91  0.69  22
Primary Proved  -     -     -     -
 Probable 1,823 2.75  5.02  161
 Sub-total 2  1,823   2.75   5.02   161
Total 2 Proved  -     -     -     -
 Probable 2,185 2.61  5.71  183
 Total  2,185   2.61   5.71   183
Sources: SRK
Notes:
1 The information relates to Ore Reserve conversion is based on i nformation compiled by Mr. Erwei Lu and Mr. Yonggang
Wu and Dr. Anshun Xu, FAusIMM, employees of SRK Consulting Chin a Ltd. Mr. Lu, Mr. Wu and Dr. Xu have sufficient
experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which Mr. Wu
is undertaking to qualify as Competent Person as defined in JOR C (2012).  Mr. Wu and Dr. Xu supervised the work of Mr.
Lu. Mr. Wu, Mr. Lu and Dr. Xu consent to the reporting of this information in the form and context in which it appears. Totals
may not add due to rounding discrepancies.
2 By reviewing the data summary details and production records, e specially the feed grade, which is showing reasonably
reconcilable, therefore, SRK trusts the stockpiles data summary  details provided by LXML have fair and adequate
information to guide the estimation of Ore Reserves.
3 The Ore Reserves in the table are included in the Mineral Resources. They should not be added to the Mineral Resources.
4 The Ore Reserves Statement is based on the depletion data provided by LXML for the six-month period, 1 April 2024 to 30
September 2024. The reported LXML data may differ from that rep orted by SRK, due the updated block model now used
by LXML for reporting. SRK considers this updated block model t o be more representative of actual production conditions
and has therefore adopted the LXML provided data as the basis for this statement.
Table ES- 7: Ore Reserve Statement of Copper Stockpiles, as of 30 September 2024 1, 2,3, 4
Type Category Tonnage
(kt)
Cu Grade
(%)
Cu Metal Contained
(kt)
Oxide Proved -    -    -
 Probable 1,185 0.93  11.05
 Sub-total 2 1,185  0.93  11.05
Primary Proved -    -    -
– IIIB-24 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Competent Person's Report for the Sepon Gold and Copper Project, Lao People's Democratic Republic
Useful Definitions    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xxv
Type Category Tonnage
(kt)
Cu Grade
(%)
Cu Metal Contained
(kt)
 Probable -   -    -
 Sub-total 2 -    -    -
Total 2 Proved -   -    -
 Probable 1,185  0.93  11.05
 Total 1,185 0.93  11.05
Sources: SRK
Notes:
1 The information relates to Ore Reserve conversion is based on i nformation compiled by Mr. Erwei Lu and Mr. Yonggang
Wu and Dr. Anshun Xu, FAusIMM, employees of SRK Consulting Chin a Ltd. Mr. Lu, Mr. Wu and Dr. Xu have sufficient
experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which Mr. Wu
is undertaking to qualify as Competent Person as defined in JOR C (2012).  Mr. Wu and Dr. Xu supervised the work of Mr.
Lu. Mr. Wu, Mr. Lu and Dr. Xu consent to the reporting of this information in the form and context in which it appears. Totals
may not add due to rounding discrepancies.
2 By reviewing the data summary details and production records, e specially the feed grade, which is showing reasonably
reconcilable, therefore, SRK trusts the stockpiles data summary  details provided by LXML have fair and adequate
information to guide the estimation of Ore Reserves.
3 The Ore Reserves in the table are included in the Mineral Resources. They should not be added to the Mineral Resources.
4 The Ore Reserves Statement is based on the depletion data provided by LXML for the six-month period, 1 April 2024 to 30
September 2024. The reported LXML data may differ from that rep orted by SRK, due the updated block model now used
by LXML for reporting. SRK considers this updated block model t o be more representative of actual production conditions
and has therefore adopted the LXML provided data as the basis for this statement.
Underground mining is new to LXML. It is located beside of DSE OP, and its decline access is built
at the DSE OP. Ore Reserves in Table ES- 8 is for underground mining (gold).
Table ES- 8: Ore Reserve Statement of Underground Gold Mining, as of 30 September 2024
1, 2, 3, 4, 5
Type Category Tonnage
(kt)
Au Grade
(g/t)
Au Metal
Contained
(t)
Au Metal
Contained
(koz)
Oxide Proved  -     -     -     -
 Probable -   -    -    -
 Sub-total 2  -     -     -     -
Primary Proved  237   5.18   1.23   40
 Probable 3,268 4.14  13.52  435
 Sub-total 2  3,505   4.21   14.75   474
Total 2 Proved  237   5.18   1.23   40
 Probable 3,268 4.14  13.52  435
 Total 3,505 4.21  14.75  474
Sources: SRK
Notes:
1 The information relates to Ore Reserve conversion is based on i nformation compiled by Mr. Erwei Lu and Mr. Yonggang
Wu and Dr. Anshun Xu, FAusIMM, employees of SRK Consulting Chin a Ltd. Mr. Lu, Mr. Wu and  Dr. Xu have sufficient
experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which Mr. Wu
is undertaking to qualify as Competent Person as defined in JOR C (2012).  Mr. Wu and Dr. Xu supervised the work of Mr.
Lu. Mr. Wu, Mr. Lu and Dr. Xu consent to the reporting of this information in the form and context in which it appears.
2 Totals may not add due to rounding discrepancies.
3 Modifying factors discussed in Section 11.5.4 has been applied to Ore Reserves estimation.
4 The Ore Reserves in the table are included in the Mineral Resources. They should not be added to the Mineral Resources.
– IIIB-25 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Competent Person's Report for the Sepon Gold and Copper Project, Lao People's Democratic Republic
Useful Definitions    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xxvi
5 The Ore Reserves Statement is based on the depletion data provided by LXML for the six-month period, 1 April 2024 to 30
September 2024. The reported LXML data may differ from that rep orted by SRK, due the updated block model now used
by LXML for reporting. SRK considers this updated block model t o be more representative of actual production conditions
and has therefore adopted the LXML provided data as the basis for this statement
Surface Mining
Historically, LXML (LXML Sepon) used to be an operational open-pit gold and copper mine. In 1992,
Rio Tinto discovered Sepon. In 1999, Rio Tinto sold an 80% option over Sepon to Oxiana. In 2004,
Oxiana bought Rio's remaining 20% stake in Sepon. In 2008, Oxiana merged with Zinifex to form OZ
Minerals. In 2010, MMG acquired Sepon from OZ Minerals. In 2018, Chifeng acquired LXML (LXML
Sepon) from MMG.
As for gold and copper operations:
 Gold production commenced in 2003 but ceased in 2013 due to price fluctuations and other
factors. In 2020, gold operations resumed. Construction of the underground mine
commenced in April 2022 at DSE UG, and the first gold ore was t ransported to the surface
in 2023. Since then, the gold operation has transitioned to a c ombination of open-pit and
underground mining.
 Copper production began in 2005, and in 2021, LXML ceased open- pit copper mining
operations. Since then, the copper processing plant has only pr ocessed oxide copper
stockpiles.
As of 30 September 2024, the gold deposits that are being or to be exploited include DSE OP, DSW
OP, NLU OP, NMK OP, Far West Area (Including MAI OP, NON OP, NKN OP), DSE UG, DSW UG.
The copper deposits that are to be exploited include KHN UG, TKM OPs.
In addition to these deposits, there are dozens of stockpiles on site to supply (tonnes & grade) gold
and oxide copper ore feed to the processing plant.
The overall processing capacity of the gold plant is 3.8 Mtpa. Historical production data of the copper
plant shows that 0.5 to 1.3 Mtpa oxide copper ore were processed. SRK noted that the actual gold
mining capacity of ore was 4.2 Mtpa, 3.8 Mtpa and 2.5Mtpa for 2 021 to 2023, of which the year in
2021 was greater than 3.8 Mtpa . Excess ore were stored in the gold ore stockpile.
The conventional mining cycle, comprising drilling, blasting, l oading, and hauling, are employed for
the extraction of ore and waste rocks. The mining operations were conducted on flitches with a height
of 2.5 meters. Based on SRK’s review, the open-pit mining is expected to be completed in the near
future, approximately within three years.
The final open-pit designs have been applied by LXML to guide mining boundaries. The mining cycle
and management have been practiced for a long time. SRK considers that no significant risks will be
encountered for the open-pit mining in the future.
Underground Mining
DSE UG is designed as an underground mine to extend mine life.  A mining study at scoping level
contained in Sepon Gold Project Study (“SGPS”) is available to date.  The mining capacity proposed
by LXML is about 650 – 710 ktpa.
– IIIB-26 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Useful Definitions    Final
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In SGPS, the proposed mining methods in the DSE UG include long -hole stoping with cemented
backfill (LHSB), long-hole stoping with pillars (LHSP), and post pillar cut and fill (PPCA).
Construction of the underground mine commenced in April 2022 at  DSE UG as mentioned before.
As of 30 September 2024, SRK was provided with revised ventilat ion designs and underground
designs by LXML.
SRK re-ran the stope optimizati on based on LHSB, as selected by  LXML, then applied modifying
factors and prepared the producti on schedule based on a review of LXML’s data. SRK notes that
LHSB has been widely practiced globally and is technically feasible.
Production Schedule
Production schedule prepared by SRK based on gold and copper mi nerals are shown in Table ES-
9.
Table ES-9: Production Schedule of LXML
Type Unit Total 2024 2025 2026 2027 2028 2029 2030
Gold Production
Open pit mining
Ore tonnage kt 2,206  956  829  421  - - - -
Au grade g/t 1.86 1.35 1.66 3.43 - - - -
Au metal kg 4,106  1,290  1,372  1,444  - - - -
Waste tonnage kt 15,37 4 5,775 3,180 6,420 - - - -
Stockpile rehandling
Ore tonnage kt 2,185 259 1,230 696 - - - -
Au grade g/t 2.61  1.19  2.34  3.63  - - - -
Au metal kg 5,707 307 2,878 2,522 - - - -
Underground mining
Ore tonnage kt 3,505 219 744 793 770 546 402 31
Au grade g/t 4.21  3.71  4.94 4.53 3.61 3.81 4.25 3.21
Au metal kg 14,745 815 3,676 3,592 2,774 2,082 1,705 101
Copper Production
Stockpile rehandling
Ore tonnage kt 1,185  447  738  - - - - -
Cu grade % 0.93 0.91 0.95 - - - - -
Cu metal kt 11 4 7 - - - - -
Sources: SRK
Mineral Processing Testing and Recovery Method
Flotation and concentrate pressure oxidation (“POX”) and carbon in leach (“CIL”) process are applied
to primary gold ore, while CIL is applied to oxide gold ore to recovery gold. The final product is Gold
Doré. The overall processing capacity of the Sepon Gold Plant i s 3.8 Mtpa, including a
primary/transition ores capacity of 2.2 Mtpa and an oxide ore capacity of 1.6 Mtpa. In the past three
years, the oxide ore throughput varied between 1.0 and 1.5 Mtpa, with gold recovery ranging from
51.8% to 68.9%. The primary ore throughput is from 1.9 to 2.1 Mtpa, with gold recovery ranging from
55% to 67%. Yearly gold production exceeds 6 tonnes. Although most of the facilities and equipment
of the gold plant were reformed from the ex-service copper plant, historical production proves it to be
practicable.
The copper ore processing facility includes a traditional agitation leaching plant and a heap leaching
operation. The mixed ore is cru shed and washed, the undersized is agitation leached after milling
– IIIB-27 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Useful Definitions    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xxviii
and then goes to counter current decantation (“CCD”) for the se paration of pregnant leach solution
(“PLS”) and residue. The oversized ore is stacked on pad for heap leaching. The pregnant solutions
from agitation leach and heap leach are merged for solvent extraction and electrowinning (“SX/EW”),
producing cathode copper plates. The integrated copper recovery  is greatly influenced by the ore
grade. Historical production data of the copper plant shows that 0.5 to 1.3 Mtpa oxide copper ore are
processed; with cathode copper production around 6,000 tpa, and copper recovery varying from 50%
to 78%. An overall recovery rate of 65% is recommended by SRK a s a parameter for subsequent
deposit evaluation and economic analysis, considering the long heap leach cycle.
Low grade primary copper ore is a menable to the flotation proce ss. Flotation tests indicated that
copper recovery of 83% to 89%, with concentrate grades of 18% to 24%, can be achieved using the
conventional flotation process. A Proof-of-Concept study has be en completed for the purpose of
primary copper resource development. By using the existing facilities of the current gold plant and a
throughput of 7.5 Mtpa, the NPV is negative. The break-even price is USD9,119 per tonne of copper.
The primary copper resource development requires a higher coppe r price and reliable resource
volume. A detailed feasibility study is recommended in due course.
Environmental and Social Aspects
The sources of environmental risk are project activities that m ay result in potential environmental
impacts.  These project activities have been previously described within this report. In summary, the
most significant potential environmental and social risks for the development of the Project, currently
identified as part of the project assessment and this SRK review, are:
 TSF seepage pollution
 Fugitive dust pollution; and
 Deficit mine closure fund.
Capital Expenditures and Operating Expenses
LXML has about 21 years of produ ction history since 2003. Capit al expenditures (“Capex”) for
construction of the mines, ore processing plants, on-site facilities etc. had been invested in the past.
LXML has made a plan for further Capex in next three years. SRK  has developed a unit sustaining
capital forecast based on the average expenditures for the year s 2022 and 2023. Table ES- 10
summarises the three Capex needed for the Sepon Project as prop osed by LXML with SRK’s
assumption for further sustaining capital.
Table ES- 10:  Further Capex needed for LXML
Item Unit 2024 2025 2026 2027 2028 2029 2030
Growth USD million 11.4  23.6 17.2
Exploration USD million 3.3  8.3 8.0
Sustain USD million 7.0  18.1 11.4 2.7 1.9 1.4 0.1
Total USD million 21.7  50.1 36.6 2.7 1.9 1.4 0.1
Sources: LXML and SRK’s Forecast
– IIIB-28 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Useful Definitions    Final
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During the economic analysis, non -current assets will be consid ered for amortization and
depreciation. Together with further Capex, they will adhere to the amortization and depreciation
rates as proposed in Table 18-2. It is reasonable to expect that the operation of the Sepon project
will be extended with further exploration and feasibility studies, the mine closure fee and the residual
value of the project will not be considered in the economic projection.
SRK was provided with production and financial records for three year of 2021, 2022, and 2023, 1Q-
3Q2024 and summaries of historical production costs in various cost centres. ES-12 summarizes the
unit operating costs.
Table ES-11:  Unit Operating Costs in 2021, 2022, 2023 and 1Q-3 Q2024
Item 2021 2022 2023 1Q-3Q2024
 Unit Cost (USD/t feed)      Average   Used for TEM
 Gold Operation
 Labor   8.3   6.4   7.5   7.7   7.5   9.0
 Material  31.6 50.2 45.4 37. 9   41.3  51.0
 Electricity   3.9   3.4   6.0   6.3   4.9   7.0
 Contractors  0.0 0.0 0.0 0. 0   0.0  0.0
 Engineering   0.0   0.0   0.0   0.0   0.0   0.0
 Service  0.0 0.0 0.0 0.0   0.0  0.0
 Safety   -     -     -     -     -     -
 Repairment  -   -   -   -     -    -
 Others   0.0   0.0   0.0   0.0   0.0   0.0
 Copper Operation
 Labor   8.4   3.7   3.6   3.5   4.8   9.0
 Material  29.1 28.8 21.7 16. 8   24.1  30.0
 Electricity   4.0   1.8   3.0   2.7   2.9   4.0
 Contractors  0.0 0.0 0.0 0.0   0.0  0.0
 Engineering   0.0   0.0   0.0   0.0   0.0   0.0
 Service  0.0 0.0 0.0 0.0   0.0  0.0
 Safety   -     -     -     -     -     -
 Repairment  -   -   -   -     -    -
 Others   0.0   0.0   0.0   0.0   0.0   0.0
 LXML Operation
 Non-income Taxes, Royalties
and Surcharges
 4.7   4.6   5.2   5.2   4.9   6.0
 Selling costs   0.0   0.0   0.0   0.0   0.0   0.0
 G&A costs  4.6 1.0 4.4 4.1   3.5  5.0
 R&D costs   -     -     -     -     -     -
 Total  94.7 100.1 96.9 84. 3   94.0  121.1
Sources: LXML
1 The unit cost forecast is based on the maximum value from the past three years, rounded up to the nearest whole number.
If the unit cost is less than 1.0 USD/feed ore, then the maximum value is used.
– IIIB-29 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


--- page 1307 ---
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Useful Definitions    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xxx
Table ES-12 presents the operating costs forecast.
Table ES-12:  Operating Cost Forecast
Item  Q4 2024 2025 2026 2027 2028 2029 2030
 Annual Cost (USD Million/a)
 Gold Operation
 Labor   12.9   25.2   17.2   6.9   4. 9   3.6   0.3
 Material  73.2 143.0 97. 4   39.2   27. 9 20.5 1.6
 Electricity   10.0   19.6   13. 4   5.4   3.8   2.8   0.2
 Contractors  0.0 0.1 0.0   0.0   0.0  0.0 0.0
 Engineering   0.0   0.0   0. 0   0.0   0.0   0.0   0.0
 Service  0.0 0.0 0.0   0.0   0.0  0.0 0.0
 Safety   -     -     -     -     -     -     -
 Repairment  -   -   -     -     -    -   -
 Others  0.0 0.0 0.0   0.0   0.0  0.0 0.0
 Copper Operation
 Labor  4.0 6.6 -     -     -    -   -
 Material   13.4   22.2   -     -     -     -     -
 Electricity  1.8 3.0 -     -     -    -   -
 Contractors   0.0   0.0   -     -     -     -     -
 Engineering  0.0 0.0 -     -     -    -   -
 Service   0.0   0.0   -     -     -     -     -
 Safety  -   -   -     -     -    -   -
 Repairment   -     -     -     -     -     -     -
 Others  0.0 0.0 -     -     -    -   -
 LXML Operation
 Non-income Taxes, Royalties and Surcharges   11.3 21.2 11.5   4.6   3.3  2.4 0.2
 Selling costs   0.0   0.1   0 .0   0.0   0.0    0.0   0.0
 G&A costs  9.4 17.7 9.5   3.8   2.7  2.0 0.2
 R&D costs   -     -     -     -     -     -     -
 Total  136.1 258.7 149.0   60.1   42.6 31.3 2.5
Sources: SRK
Economic Analysis
Based on the information provided by LXML, SRK’s preliminary re view and analysis indicate that
LXML still has about three years of surface gold mining (including open-pit and stockpile rehandling)
and surface copper mining (stockpile rehandling only), and seven years of underground gold
operation.
Figure ES- 1 shows the annual net cash flow for LXML.
– IIIB-30 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Useful Definitions    Final
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Figure ES- 1:   Annual Net Cash Flow for LXML

Sources: SRK
Based on the parameters reviewed and summarized in the report, an economic analysis indicates
that the overall operation will have a NPV ranging from USD247.1 million (at a discount rate of 8%)
to USD  232.6 million (at a discount rate of 12%), and USD  239 .6 million at the base case (at a
discount rate of 10%).
Project Risk Analysis
Mining is a relatively high-risk industry. In general, the risk  may be expected to decrease from
exploration, development, through to production stage. The Sepo n Project is a production project.
Risks exist in different areas. SRK considered various technica l aspects which may affect the
feasibility and future cash flow of the Project and conducted a  qualitative risk analysis which has
been summarised in Table ES-13.
– IIIB-31 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Table ES-13:  Project Risk Assessment of the Sepon Project
Risk Source/Issue Likelihood Consequence Overall
Geology and Resource
Lack of Significant Mineral Resources Unlikely Moderate Low
Lack of Significant Ore Reserves Possible Major High
Unexpected Groundwater Ingress Unlikely Minor Low
Mining
Significant Production Shortfalls Unlikely Major Medium
Significant Geological Structure Possible Minor Low
Excessive Surface Subsidence Unlikely Minor Low
Poor Ground Conditions Possible Moderate Medium
Ore Processing
Lower Recovery Unlikely Moderate Low
High Production Cost Possible Minor Low
Poor Plant Reliability Unlikely Minor Low
Capital and Operating Costs
Project Timing Delays Possible Minor Low
Capital Cost Increases Unlikely Minor Low
Operating Cost Underestimated Likely Minor Medium
High mine closure cost Likely Moderate High
Environmental, Social and Permitting
Impact to the ecological system Possible Moderate Medium
Poor waste rock management Possible Moderate Medium
Poor hazardous substances management Possible Minor Low
Dust Pollution Possible Minor Low
Renewal of mining licence Unlikely Major Medium
Two high risks of the project are “Lack of significant Ore Reserves” and “High mine closure cost”. To
manage the risks, SRK recommends the Company should further con duct feasibility studies to
develop currently available mineral resources in order to exten d the mine life of the project, as well
as proactively manage the environmental and mine closure issues during the production, in order to
reduce the high mine closure cost at the end of the mine.



– IIIB-32 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 1
1 Introduction and Terms of Reference
SRK Consulting China Ltd. (“SRK”) was requested by Chifeng Jilong Gold Mining Co., Ltd. (“Chifeng
Gold” or the “Client”) to prepare a Competent Person’s Report (“CPR” or the “Report”) for its Sepon
Gold and Copper Projects (the “ the Projects ”) located in Savannakhet Province, Lao People’s
Republic (“ Laos”) in accordance with the guidelines of the Australasian Code f or Reporting
Exploration Results, Mineral Resources and Ore Reserves, 2012 edition (“JORC Code (2012)”) and
the Rules Governing the Listing of Securities on The Stock Exch ange of Hong Kong Limited
(“HKEx”),  including the Chapter 18 requirements (Appendix C), Chapte r 2.6 of the Guide for New
Listing Applicants (Appendix D)  and other relevant regulations of the Exchange and Hong Kong
Exchanges and Clearing Ltd (“HKEx”).
The projects include exploration licenses, mining licenses, cur rently operating open-pit mines, and
associated ore processing metallurgic plants, as well as an underground mine in development, and
various defined deposits with gold, copper and rare earth elements (“REE”) mineral resources. The
projects are currently operated by Lane Xang Minerals Limited C ompany (“LXML”), which is 90%
owned by Chifeng Gold, and 10% owned by Laos government.
– IIIB-33 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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2 Program Objectives and Work Program
2.1 Purpose of the Report
The purpose of this Report is to provide both existing Chifeng Gold shareholders and potential
investors with a CPR of its Sepon Gold and Copper Projects in Laos. The SRK’s report is proposed
to provide an unbiased technical assessment of the risk associated with the Project.
2.2 Scope of Work and Reporting Standard
2.2.1 Scope of Work
The scope of work, as defined in letters of engagement executed in November 2022 and May 2024
between Chifeng Gold and SRK, includes the review/updating of m ineral resource models for the
gold and copper mineralisation, and review the REE mineralization, delineated on the Projects and
preparation of a CPR in compliance with JORC (2012) and the lis ting requirements of the HKEx.
This work involved the assessment of the following aspects of the Projects.
 Regional, local and mine geology
 Exploration history, quality and independent data verification
 Geological modelling, mineral resource estimation and validation
 Mining assessment
 Processing and mineral recovery, smelter and refinery
 Environmental and social
 Operating and capital costs; and economic analysis
 Preparation of a Mineral Resource Statement and a Ore Reserve Statement
 Recommendations for additional work
2.2.2 Basis of Technical Report
This report is based on information collected by SRK during site visits carried out between 8 and 14
December 2022, December 2024, and May 2023, and additional info rmation provided by LXML
throughout the course of SRK’s investigations. SRK has no reaso n to doubt the reliability of the
information provided by LXML. Other information was obtained from the public domain. This technical
report is based on the following sources of information:
 Discussions with LXML and Sepon Mine personnel
 Inspection of the Sepon Gold and Copper Projects area, including outcrops and drill cores
 Review of exploration data collected by LXML
 Additional information obtained from public domain sources
This report has been prepared to accommodate the requirements o f HKEx, and the Mineral
Resources and Ore Reserves are reported according to the JORC C ode (2012) which is binding
– IIIB-34 –
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upon all Australasian Institute of Mining and Metallurgy (“AusIMM”) members.
2.2.3 Site Visit
Dr. Anshun Xu and Dr. Yingting (Tony) Guo visited the Sepon Project during the period from 8 to 14
December 2022 accompanied by Mr.  Paul Harris, Chairman of LXML,  and other management and
technical personnel of LXML. In December 2023, Mr. Yonggang Wu, Mr. Liang Li, and Mr. Erwei Lu
visited the project site; and In May 2024, Dr. Andy Li, Mr. Lan liang Niu and Mr. Erwei Lu also
conducted a site visit to the project site for updating the technical report of the project.
The purpose of the site visits was to review the digitalization  of the exploration database and
validation procedures, review exploration procedures, define ge ological modelling procedures,
examine drill core, interview project personnel, and collect all relevant information for the preparation
of a revised mineral resource model and inspect the geology and mineralization of the projects, and
observe the mining and processing operations.  During the visit, a particular attention was given to
the treatment and validation of historical drilling data.
SRK was given a full access to relevant data and conducted interviews with Sepon/LXML personnel
to obtain information on the past exploration work, to understand procedures used to collect, record,
store and analyse historical and current exploration data, as w ell as operating issues and related
data.
2.2.4 Reporting Standard
This Report has been prepared to the standard of, and is consid ered by SRK to be, a Technical
Assessment Report under the guidelines of the 2015 edition of the Code for Technical Assessment
and Valuation of Mineral Petroleum Assets and Securities for Independent Expert Reports  (the
“Valmin Code ”). The Valmin Code incorporates The JORC Code for the reportin g of Mineral
Resources and Ore Reserves and is binding upon all the Australa sian Institute of Mining and
Metallurgy (“AusIMM”) members.
This Report is not a Valuation Report and does not express an o pinion as to the value of mineral
assets. Aspects reviewed in this Report do include product pric es, socio-political issues and
environmental considerations; however, SRK does not express an opinion regarding the specific
value of the assets and tenements involved.
In this Report, identified Mineral Resources and Ore Reserves a re quoted using categorisation in
accordance with the JORC Code.  However, it should not be assumed that these Mineral Resource
and Ore Reserve Estimates have necessarily been carried out in accordance with the guidelines and
recommendations laid out in the JORC Code, at least until furth er documentation can be obtained
on the estimates and they have been formally endorsed by a “Competent Person” in accordance with
the JORC Code.
2.3 Limitations Statement
SRK is not professionally qualified to opine upon and/ or confirm that the Client has 100% ownership
of its underlying tenement and/ or has any unresolved legal mat ters relating to any transfer of
ownership or associated fees and royalties. SRK has therefore a ssumed that there are no legal
impediments regarding the existence of the relevant tenements and that the Client has legal right to
– IIIB-35 –
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all underlying tenements as purported. Assessing the legal tenures and rights to the prospects of the
Client and or any of its subsidiary companies are the responsibility of legal due diligence conducted
by entities other than SRK.
2.4 Effective Date
SRK’s opinion contained herein and effective as of 30 September 2024 , is based on information
collected by SRK throughout the course of SRK’s examination and  verification. The information in
turn reflects various technical and economic conditions at the time of writing this report. Given the
nature of the mining business, these conditions can change significantly over relatively short periods
of time. Consequently, actual results may be significantly more or less favourable.
This report may include technical information that requires sub sequent calculations to derive
subtotals, totals, and weighted averages. Such calculations inherently involve a degree of rounding
and consequently introduce a margin of error. Where these occur , SRK does not consider them to
be material.
2.5 Work Program
The mineral resource statement reported herein is a collaborative effort between Chifeng Gold/LXML
and SRK personnel. The exploration database was compiled and maintained by Chifeng Gold/LXML,
and was audited by SRK. In the opinion of SRK, the geological model is a reasonable representation
of the distribution of the target ed mineralization at the curre nt level of sampling. The geostatistical
analysis, variography and grade models were completed by SRK during the months from December
2022 to January 2023.
The Mineral Resource Statement reported herein was prepared in conformity with the generally
accepted CIM Exploration Best Practices Guidelines and CIM Esti mation of Mineral Resource and
Ore Reserves Best Practices Guidelines. This technical report w as prepared according to JORC
(2012) and the Rules Governing t he Listing of Securities on The  Stock Exchange of Hong Kong
Limited (“HKEx”).
The technical report was compiled in SRK China offices during the months from December 2022 and
January 2023, and was updated from May to November 2024.
2.6 SRK Experience
The SRK Consulting Group (“SRK Consulting”) is an independent, international consulting practice
that provides focused advice and solutions to clients, mainly f rom earth and water resource
industries. For mining projects, SRK Consulting offers services  from exploration through feasibility,
mine planning, and production to mine closure.
Among the company’s more than 1,500 clients are most of the world’s major and medium-sized metal
and industrial mineral mining houses, exploration companies, banks, petroleum exploration.
Formed in 1974 in Johannesburg, South Africa, SRK Consulting no w employs more than 1,800
professionals internationally in 42 permanent offices across 20 countries on six continents. A broad
range of internationally recognised associate consultants complements the core staff.
– IIIB-36 –
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SRK Consulting employs leading specialists in each field of science and engineering. Its seamless
integration of services, along with its global base, has made t he company a world leader in due
diligence, feasibility studies, and confidential internal reviews.
SRK Consulting’s independence is ensured by the fact that it holds no equity in any project and that
its ownership rests solely with its staff. This enables the company to provide its clients with objective,
conflict-free recommendations on crucial judgement issues.
SRK China was established in 2005 and has three offices located in Beijing, Nanchang and Kunming.
Either independently or together with other SRK Consulting offi ces—especially SRK Australasia,
SRK has been providing independent technical services for the C hinese mining companies. SRK
has considerable experience at providing Independent Expert Rep orts for mining companies who
have successfully listed on the stock exchanges in Hong Kong, Australia, United Kingdom, Canada,
South Africa and the United States.
SRK has provided dozens of independent technical reports for th e Chinese mining companies who
have completed successfully list ed and/or acquired on the Stock  Exchange of Hong Kong Ltd., as
shown in Table 2-1.
Table 2-1: SRK’s Reports f or Listing on the HKEx
Company Year Nature of Transaction
Yanzhou Coal Limited (listed in HKEx) 2000 Sale of Jining III c oal mine to the listed operating company
Chalco (Aluminium Corporation of
China) 2001 Listing on HKEx and New York Stock Exchange
Fujian Zijin Gold Mining Group 2004 IPO Listing on HKEx
Lingbao Gold Limited 2005 IPO Listing on HKEx
Yue Da Holdings Limited (listed in
HKEx) 2006 Acquisition of shareholding in mining projects in Yunnan,
China
China Coal Energy Company Ltd (China
Coal) 2006 IPO Listing on HKEx
Sino Gold Mining Limited 2007 Dual Listing on HKEx
Xinjiang Xinxin Mining Industry Co., Ltd 2007 IPO Listing on HK Ex
Kiu Hung International Holding Limited 2008 Acquisition of shareholding in coal projects in Inner
Mongolia, China
Hao Tian Resource Group Limited 2009 Very Substantial Acquisition of two coal mines in Inner
Mongolia, China
Green Global Resources Holdings Ltd 2009 Very Substantial Acquisition of shareholding in one iron
project in Mongolia
Ming Fung Jewellery Group Holdings
Ltd 2009 Acquisition of shareholding in gold project in Inner
Mongolia, China
Continental Holdings Limited 2009 Acquisition of a gold project  in Henan, China
North Mining Shares Company Limited 2009 Acquisition of a molybdenum mining project in Shaanxi,
China
– IIIB-37 –
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FOR THE SEPON GOLD AND COPPER MINE


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Company Year Nature of Transaction
CNNC International Ltd 2010 Acquisition of a uranium mine in Af rica
Sino Prosper Mineral Products Ltd 2010 Acquisition of shareholdings in one gold project in Inner
Mongolia, China
New Times Energy Corporation Ltd 2010 Acquisition of shareholding in gold projects in Hebei,
China
United Company RUSAL Limited 2010 IPO Listing on HKEx
Citic Dameng Holdings Limited 2010 IPO Listing on HKEx
China Hanking Holdings Limited 2011 IPO Listing on HKEx
China Daye Non-Ferrous Metal Mining
Limited 2012 Very Substantial Acquisition on HKEx
China Nonferrous Mining Corporation
Limited 2012 IPO Listing on HKEx
Hengshi Mining Investments Limited 2013 IPO Listing on HKEx
Future Bright Mining Holdings Limited 2014 IPO Listing on HKEx
King Stone Energy Group Limited 2014 Acquisition of Shareholding in silver mines in Fujian,
China
Agritrade International Pte LTD 2015 Acquisition of Shareholdin g in one coal mine in Indonesia
China Unienergy Group Limited 2016 IPO Listing on HKEx
Pizu Investment Co. Ltd 2020 Acquisition of Shareholding in a polymetallic project in
China
China Qinfa Group Limited 2021 Annual disclosure of coal mines in Shanxi, China
China Graphite Group Limited 2022 IPO Listing on HKEx
Kinetic Development Group 2022 Ma jor transaction of equity interest in Ningxia Sunshine
Persistence Resources Group Ltd 2023 IPO Listing on HKEx
2.7 SRK Project Team
The SRK project team and responsibilities are shown in Table 2-2.
Table 2-2: SRK Project Team
Consultant Title Discipline and Task
Dr. Anshun Xu Corporate Consultant (Geology) Project Manager, w hole report, CP
Liang Li Senior Consultant (Geology) Geology, Mineral Resource Estimation
Yingting Guo Associate Consultant (Geology) Geology Review
Erwei Lu Consultant (Mining) Mining Review
Yonggang Wu Principal Consultant (Mining) Mining Review, CP
Lanliang Niu Principal Consultant (Processing) Processing Revie w
– IIIB-38 –
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Consultant Title Discipline and Task
Xiangfeng Yang Senior Consultant (Processing) Processing Review
Yuanhai Li Principal Consultant (Environment) Environment, Soci al, and Permitting Review
Dr Yonglian Sun Corporate Consult ant (Mining) Inte rnal Peer Review and Quality Control
The short bios of key SRK personnel are shown below:
Anshun Xu (Anson Xu), Ph.D., FAusIMM, is a Corporate Consultant (Geology) who specializes in
the exploration of mineral deposits.  He has more than 30 years ’ experience in exploration and
development of various types of mineral deposits including Cu-Ni sulphide deposits related to ultra-
basic rocks, tungsten and tin deposits, diamond deposits, and e specially deep expertise in various
types of gold deposits, including vein-type, fracture-breccia z one type, alteration type, and carlin
type.  He was responsible for the resource estimations of several diamond deposits, and for reviews
of resource estimations of several gold deposits.  He recently completed several due diligence jobs
for clients from both China and overseas including technical review projects such as Canadian NI43-
101 reports and HKEx IPO technical reports.  Dr. Xu was the Pro jects manager of this project and
the Competent Person (“CP”) who takes overall responsibility for this report.
Yingting (Tony) Guo. Ph.D., P. Geo. MMSA, is a Professional Geoscientist and a member of the
Association of Professional Engineers and Geoscientists of the Province of British Columbia, Canada
(P. Geo), holding License Number 31257. He is also a Qualified Professional (QP) Member with
special expertise in Geology and Ore Reserves from the Mining and Metallurgical Society of America
(MMSA), holding Member Number 01472QP. Dr. Guo has extensive experience in precious metals
exploration, mineral resource estimate, mining project PEA stud y as well JORC / 43-101 report
preparation. He has worked and/or prepared NI43-101/JORC reports on more than 10 gold/copper
projects including the Toromocho copper mine project from China lco in Peru; Jiama Copper-Gold
mine project for China Gold International in Tibet, China. Vatu koula Gold project for Zhongrun
Resources in Fiji. He has sufficient experience relevant to the  style of Sepon gold/copper
mineralization and deposit types under consideration to qualify as Competent Person, as defined in
JORC code. He will be responsible for data verification, as well as reviewing on geology, exploration,
resource estimate, and he visited the project site.
Liang Li, MEng. (Geology and Resources), is a Senior Geological Consultant at SRK China. Prior
to joining SRK, he worked as a geologist for three different co mpanies. He has gained lots of
experiences and expertise in mine geology, grade control and op timization, resources/reserves
management. He is also very familiar with the processes and principles to geological prospecting of
metallic ore deposits in China. He gained lots of rules of thum b in mining, especially in
resources/reserves estimation. In addition, he is proficient in digital modelling by using Surpac.
Yonggang Wu, (Mining and Reserves) ，，M.Eng., is a Principle Consultant (Mining). He joined
SRK after graduation from Jiangxi University of Science and Technology in 2007.  He has acquired
specialized knowledge of mining engineering, MineSight software and has been involved in various
projects to date. He has worked on a wide range of commodities including Au, Ag, Pb, Zn, Mn, Cu,
Fe, W, Sn, fluorite, potassium salts, alum, phosphorus, serpent ine, and many more. He has
accumulated extensive experience in mineral resource/ Ore Reserve estimation, pit limit optimization
and design, underground mining design, long-term production pla nning, mining assessment, public
facilities and infrastructures assessment and due diligence stu dies. Yonggang has expertise in
– IIIB-39 –
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geological and mining modelling and is proficient in using Mine Sight, Surpac, AutoCAD, and other
specialized software packages.  He has been involved in dozens of independent technical reports,
due diligence reports and annual reports to provide investors, decision makers and shareholders
with unbiased technical opinions.
Erwei Lu,  M.Eng.; Consultant (Mining) at SRK China , he obtained his bachelor’s degree and
master’s degree in mining engineering from Central South Univer sity. He has over five years of
practice of underground operation, and about one year’s mineral  project evaluation experience. He
worked as an on-site mining engineer in Zambia for China Nonferrous Metal Mining (Group) Co., Ltd.
after graduation in 2017. He also worked for an autonomous driving application and mineral project
investment companies since 2022. He is familiar with large scal e underground mobile equipment
operation and training, long-hole blasting, mine design and scheduling, and production management,
as well as autonomous driving application in open pit mine, and project evaluation.
Lanliang Niu, B.Eng., MAusIMM, is a Principal Consultant (Mineral Processing), who graduated
in 1987 from Beijing University of Science and Technology major ing in ore processing.  He has
worked on the industrial testing of gold leaching with low grad e ores, managed or participated in
processing and metallurgical testing for more than 10 precious and non-ferrous metals projects.  With
SRK, he has been responsible for the ore processing and metallu rgical scope of work and involved
in many key projects.  Mr. Niu was responsible for the metallurgical and processing review.
Andy Li, PhD, MAusIMM, is a Principal Environmental Consultant  with SRK Consulting China
Ltd. Having graduated with a doctoral degree in Environmental E ngineering from the Florida State
University, he has over 12 years’ experience in the environmental engineering field and has worked
in various environmental projects in the USA, China, Mongolia, and a number of South Asian
countries. He has particular expertise in environmental due diligence reviews, environmental
compliance, and impact assessments for mining, mineral processi ng, refining, and smelting; in
contaminated-site assessments a nd remedial design; in wetland a nd landfill rehabilitation; and in
environmental-risk assessment. He also has extensive experience  in water/wastewater treatment
design, water distribution system s, and storm water management system design. Dr. Li was
responsible for the environmental, permit, social and community review.
Yonglian Sun, B.Eng. PhD, FAusIMM, FIEAust, CPEng., is a Corporate Consultant and a Practice
Leader of SRK China. Dr Sun has over 30 years’ experience in geotechnical engineering and mining
engineering in five countries across four continents. He also has extensive international experience
in mining project evaluation for project financing and overseas  stock market listings. Over the last
decade, Dr Sun has led and coordinated dozens of due diligence projects for many mining companies
and most of them have been successfully financed or listed on the HKEx. Dr Sun provided internal
peer review to ensure the quality of the report meets the required standard.
2.8 Warranties
Chifeng Gold has warranted to SRK that full disclosure has been  made of all material information
and that, to the best of their knowledge and understanding, suc h information is complete, accurate
and true. SRK has no reason to doubt these warranties.
Based on the information provided by Chifeng Gold, there are no  events that have occurred since
the Effective Date that are likely to have a material impact on  the Mineral Resource and Mineral
Reserve statements for the Sepon Au Cu Project at the date of publication of this CPR.
– IIIB-40 –
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2.9 Compliance Statement
The information in this report that relates to Mineral Resources/Ore Reserves is based on information
compiled by Dr. Anshun Xu, a Competent Person who is a Fellow of the AusIMM, and Mr. Yonggang
Wu, a Competent Person Who is a Member of the AusIMM. Both are full time employee of SRK
Consulting China Ltd.
This Report is a Competent Person’s Report in line with the Listing Rules of the Exchange and HKEX.
Dr. Anshun Xu has no prior association with Chifeng Gold in reg ard to the mineral assets that are
the subject of this Report.  Dr. Anshun Xu has no beneficial in terest in the outcome of the technical
assessment being capable of affecting its independence.
Dr. Anshun Xu and Mr. Yonggang Wu have sufficient experience th at is relevant to the style of
mineralisation and type of deposit under consideration and to the activity being undertaken to qualify
as a Competent Person as defined in the JORC Code”.
Dr. Anshun Xu and Mr. Yonggang Wu consent to the inclusion in the report of the matters based on
their information in the form and context in which it appears.
Peer review and quality control of the Report were conducted by  Dr. Yonglian Sun, FAusIMM (CP
Eng), a Principal Consultant (Mining).
2.10 Independence Statement
Neither SRK nor any of the authors of this Report have any material present or contingent interest in
the outcome of this Report, nor do they have any pecuniary or other interest that could be reasonably
regarded as being capable of affecting their independence or that of SRK.
SRK’s fee for completing this Report is based on its normal pro fessional daily rates plus
reimbursement of incidental expenses. The payment of that professional fee is not contingent upon
the outcome of the Report.
SRK has no prior association with Chifeng Gold or Chifeng Gold’ s employees or in regard to the
mineral assets that are the subj ect of this Report. SRK has no beneficial interest in the outcome of
the technical assessment being capable of affecting its indepen dence. SRK is independent of
Chifeng Gold applying all of the tests in 18.21 and 18.22 of th e Listing Rules of the Exchange and
HKEX.
SRK is not an insider, associate or an affiliate of Chifeng Gold, and neither SRK nor any affiliate has
acted as advisor to Chifeng Gold, its subsidiaries or its affiliates in connection with the projects. The
results of the technical review by SRK are not dependent on any  prior agreements concerning the
conclusions to be reached, nor are there any undisclosed unders tandings concerning any future
business dealings.
2.11 Consent
SRK consents to this Report being included, in full, in documen ts that Chifeng Gold proposes to
submit to the HKEX and/ or disclo sure to the public markets, in  the form and context in which the
technical assessment is provided, and not for any other purpose.
– IIIB-41 –
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SRK provides this consent on the basis that the technical asses sments expressed in the Executive
Summary and in the individual sections of this Report are considered with, and not independently of,
the information set out in the complete Report and the Cover Letter.
2.12 Forward Looking Statement
Estimates of Mineral Resources, Ore Reserves, and mine production are inherently forward-looking
statements, which being projecti ons of future performance will necessarily differ from the actual
performance. The errors in such projections result from the inherent uncertainties in the interpretation
of geologic data, in variations in the execution of mining and processing plans, in the inability to meet
construction and production schedules due to many factors inclu ding weather, availability of
necessary equipment and supplies, fluctuating prices, ability of the workforce to maintain equipment,
and changes in regulations or the regulatory climate.
The possible sources of error in the forward-looking statements are addressed in more detail in the
appropriate sections of this report. Also provided in the report are comments on the areas of concern
inherent in the different areas of the mining and processing operations.
– IIIB-42 –
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3 Operational Licenses and Permits
This section summarises related operational licences and permit s. SRK relies on the information
provided by the Company, and SRK understands that a legal due diligence review of this Project has
been undertaken by the Company’s legal advisors.
3.1 Mining License
Table 3-1 summarizes key information of the mining license, and  a scanned copy of the original
mining license associated with an English translation is attached in Appendix A.
Table 3-1: Mining License
Name of Mine Sepon Copper Gold Mine
Ming License No. ML0002
Issued to  Lane Xang Minerals Limited
Issued by  Ministry of Mine and Energy
Area (km2) 116.96
Issuing Date 30 September 2023
Expiry Date 29 September 2033
3.2 Exploration Permit
Currently, LXML possesses an exploration permit with a total ar ea of 996.12 km2, which is valid till
June 2026. The exploration permit consists of 66 inflection points which have been provided in Table
3-2 below.
Table 3-2: Inflection Points of Sepon Exploration Permit
Coordinates（（Indian60/UTM zone 48N)
No. Easting Northing No. Easting Northing No. Easting Northing
1 576400 1882200 23 627800 1878000 45 592000 1871800
2 585600 1882200 24 639800 1878000 46 590800 1871800
3 585600 1879600 25 639800 1872200 47 590800 1872400
4 588800 1879600 26 634000 1872200 48 589200 1872400
5 588800 1881000 27 634000 1870600 49 589200 1873200
6 593200 1881000 28 624800 1870600 50 587400 1873200
7 593200 1882200 29 624800 1868200 51 587400 1874000
8 597600 1882200 30 616400 1868200 52 585600 1874000
9 597600 1893200 31 616400 1862200 53 585600 1874600
10 606000 1893200 32 654400 1862200 54 583800 1874600
11 606000 1890800 33 654400 1856200 55 583800 1875200
12 604400 1890800 34 625000 1856200 56 582400 1875200
13 604400 1887400 35 625000 1861600 57 582400 1875800
14 613200 1887400 36 615400 1861600 58 581000 1875800
15 613200 1892200 37 615400 1863200 59 581000 1876400
16 615000 1892200 38 608000 1863200 60 579600 1876400
17 615000 1894800 39 608000 1867200 61 579600 1877000
18 619000 1894800 40 598000 1867200 62 578800 1877000
19 619000 1892600 41 598000 1867800 63 578800 1877600
20 622000 1892600 42 594600 1867800 64 577400 1877600
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Coordinates（（Indian60/UTM zone 48N)
No. Easting Northing No. Easting Northing No. Easting Northing
21 622000 1881200 43 594600 1869000 65 577400 1878000
22 627800 1881200 44 592000 1869000 66 576400 1878000
3.3 Other Key Operational Licenses and Permits
Table 3-3 presents the major information of the business license. LXML operates the Sepon project,
in which Chifeng Gold owns 90% interest and the Lao Government owns the rest 10%.
Table 3-3: Business License
Name of Enterprise Lane Xang Minerals Limited
Registration No. 01-00010734
Operation Activities Sepon Gold-Copper Exploitation
Issued by Ministry of Industry and Commerce
Issuing Date 19 October 2018
Expiry Date Long Term
The Company provided SRK with revised Mineral Exploration and Production Agreement (“MEPA”)
dated 15 September 2023 between the Lao government and the Comp any. According to this
agreement, up to 1,127.00 km 2 contract area is defined for the purpose of mining and explora tion
activities for the project. Annual rent fee is paid to the Lao Government as follows: USD 200/ km2 for
exploration and USD 8,000/ km2 for mining. This contract area is served as the land use agreement
with the Lao Government. In addition, communities living within LXML’s concession area retain land
use rights and are legally entitled to compensation for impacts to their land, property and livelihoods
due to exploration activities and mining operations. According to the Company, the average
compensation paid is ranged from USD 9,000 – 15,000/ha, based o n quality of assets on the
compensated land. The Company has compensated the impacted residents accordingly.
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4 Accessibility, Climate, Local Resources,
Infrastructure, and Physiography
4.1 Accessibility
The Sepon project area located in Savannakhet province, south-c entral Laos (Figure 4-1).  Access
to the project area from Vientiane, the capital of Laos may take about 1.5 hours flight or about 8 hour
driving with a distance about 560 km.  There are daily charter flights between Vientiane and Sepon
mine in weekdays. There are also daily flights between Vientiane and Chinese, Vietnam and Thailand
cities. Alternate access to the project is about 1 hour flight between Vientiane and Savannakhet and
then 4 hour bus-ride between Savannakhet to Sepon.
Figure 4-1: Location of Sepon Project

Source: LXML, 2022
4.2 Physiography and Climate
The Sepon project area has a geomorphology of low-mid mountains.  The elevations generally range
from 240 to 420m above sea level (“ASL”).  The highest point in  the mountainous area in north is
755.0m ASL. In the mine area, the relative elevation differences are about 50 to about 100m.
The mountain ranges generally strike near east to westerly.  Water runs from the slope of each side
to small streams.  During dry the season, most of the small streams are dry out, while the small rivers
into which the small streams flow have running water all year r ound. The small rivers flow into
Sebanghiang River at the foot of the south slope, and the Seban ghiang River flows into Mekong
River.
The climate in the project area belongs to tropic climate with northeast monsoon and southwest
monsoon.  The raining season relates to the southwest monsoon w ith the characteristics of heavy
rains, high temperatures and high moistures, and lasts from mid -April to mid-October.  The dry
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season lasts from mid-October to mid-April of the following year with the characteristics of less rains
and relatively lower temperatures and moistures, with the driest season from mid-November to mid-
February of the following year.  The monthly temperatures and precipitations in the project area have
been illustrated in Figure 4-2 below.
Figure 4-2: Monthly Temperatures and Precipitations in the Proj ect Area

4.3 Local Resources and Infrastructure
In the Sepon Project region, the vegetations are abundant with eucalyptus forest and bushes.
Villages are widely distributed in the area, and villagers gene rally work in agriculture and forestry
productions.  Rice is the main crop and Manihot is also important crop. Industry is not well developed.
Labours are abundant, while technical personnel are absent.
Power line of 220 KV goes through the area and supplies the ele ctricity. Telephones and mobile
communication are also available.
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5 History
Artisanal gold panning in numerous river valleys of the Sepon district was practiced in history, but no
assessment of the hard rock pot ential had ever been undertaken prior to the involvement of CRA
Exploration in 1990.
Potential of the Sepon district w as first recognised by CRA geo logists. While the style of
mineralization was not immediatel y well understood, the associa tion of porphyry intrusives, district
scale alteration and extensive gold occurrences (alluvial and hardrock) was considered highly
significant. The prospectivity was further confirmed by the assay results for 18 rock samples reported
between 3.6 and 55.9g/t Au.
An application covering 5,000 square kilometers (“km 2”) in Savannakhet and Khammouane
Provinces was submitted to the Lao Government in early 1991, an d a MEPA was signed in
September 1993. This Agreement provides for the exclusive right to explore, mine, process, transport
and market all minerals from the MEPA.
Intensive exploration by CRA/Rio Tinto between 1993 and 1999 resulted in the discovery of gold and
copper mineral resources in six separate deposits. In 1999 Rio Tinto decided to divest of the Sepon
Project because it did not satisfy the companies resource size criteria. The project was put to
competitive tender and following extensive due diligence Oxiana  successfully bid for an 80% stake
in the project in early 2000. Rio Tinto retained a 20% sharehol ding and has continued to provide
strong support for Oxiana’s subsequent gold and copper mine developments.
Oxiana decided to develop the project in two phases, i.e. oxidi zed gold development and oxidized
copper development.  In October 2001 a definitive feasibility study on development of gold mineral
resources was done.  The gold production from the Sepon project  started in 2003, and stopped in
December 2013 due to high operating cost and low grade.  The fe asibility study for developing the
copper mineral resources was conducted in 2002. In March 2005, the Sepon mine completed the
construction of copper processing plant and started copper production. In 2017, the peak production
of cathode copper was more than 90,000 tonnes per year.
In 2018, Chifeng Gold acquired LXML which owns the Sepon projec t.  In 2020, the Sepon project
started production of gold from  mining primary gold mineral res ources.  Currently the production is
mainly from the primary gold resources, focusing on processing of oxidized gold and copper
resources, with an annual production of about 10,000 tonnes cathode copper, and about 7 tonnes
gold.
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6 Geological Setting and Mineralization
6.1 Regional Geology
Tectonically, Sepon project area lies within the Truongson Fold Belt (or Annamite Cordillera) and the
Kontum Massif. The Truongson Fold Belt is a NW elongated belt between South China Terrane and
Indochina Terrane (Figure 6-1).
The Troungson Fold Belt is consisted of Early to Mid Palaeozoic sediments and lesser volcanic rocks,
interspersed with lesser tectonic slices of metamorphic terranes, bound to the north by the Song Ma-
Song Da suture zone and to the south by the NW trending Truongs on Fault. The Kontum Massif
comprises an Upper Proterozoic basement of ortho- and para-gnei ss, crystalline schist and
migmatite which abuts the Truongson Fold Belt to the south.
Figure 6-1: Regional Geology Setting

6.1.1 Regional Stratigraphy
The main strata in the region include the Proterozoic low to mid-high grade metamorphic rocks, such
as schist, marble and gneiss; Palaeozoic marine volcanic and sedimentary rocks with some
continental volcanic and sedimentary rocks, such as limestone, sandstone, siltstone, shale,
mudstone and marlstone; Mesozoic continental sedimentary rocks, such as red sandstone and clay;
and Cenozoic loose sand and gravel.
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6.1.2 Regional Structures
In the Sepon district, the Truongson Fold Belt is represented b y a series of E-W trending basins
which are truncated by the NW-striking Truongson Fault (Figure 6-1).  Affected by the Fault, NW and
nearly S-N striking faults were developed, with some secondary faults striking NE and nearly E-W.
6.1.3 Magmatic Rocks
Granitic intrusions have been mapped in the district as well as  rhyodacite and andesite dykes and
stocks, interpreted to be part of the Late Palaeozoic Variscan Orogeny.   At least three phases of
around 300 Ma rhyodacite porphyry intrusion are recognised, inc luding a late, quartz-stockwork
veined phase, which is interpreted to be genetically associated  with all known Cu and Au
mineralisation in the field.  Mi nor remnants of Jurassic to Cre taceous Khorat Basin continental
sedimentary rocks unconformably overlie the Palaeozoic marine sedimentary sequences to the east
and north, while west of the Kontum Massif and south of the Tru ongson Fault, Khorat sedimentary
rocks are dominant.   Cenozoic volcanic rocks unconformably ove rlie the Palaeozoic rocks to the
north-east.
6.1.4 Regional Mineralization
There are abundant mineral resources in the region, including gold, copper, lead-zinc and limestone
resources, as well as coal, iron, REE and bauxite resources.
6.2 Property Geology
Figure 6-2 shows a geological map of the Sepon Project area.
Figure 6-2: Local Geology Setting

Source: Sepon Mine, LXML
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6.2.1 Gold and Copper Deposit Geology
Stratigraphy
The Sepon basin comprises Devonian to Carboniferous age continental fluvial and shallow to deep
marine sediments, deposited duri ng the formation of an E-W orie nted pull-apart basin. Alternating
sequences of carbonate (calcareous shale, dolostone, limestone)  and siliciclastic (sandstone,
siltstone) rocks form the stratigraphy of the SMD.
The Sepon stratigraphic sequence succession has been informally  divided into 8 formations based
on lithology and depositional setting (Figure 6-3).
1. Highway Formation
The Highway Formation represents the lower siliclastic, marine sedimentary sequence of
stratigraphy that dominates the southern and eastern areas arou nd the Sepon Mining District and
also directly north of the North Bounding Fault. The lower memb er of the Highway Formation
comprises a sequence dominated by thick bedded arenitic to arko sic sandstones with lesser,
irregular interbeds of siltstone, mudstone and shale. Intervals of thin bedded to laminated calcilutite,
calcarenite and limestone occur t owards the top of the member. The Upper Highway Member is
compositionally similar to the Lower Member but is distinct due  to generally thinner bedding
thicknesses and more regular (even thickness) beds. It is characterised as medium to thickly bedded
(ranging from 0.1 m to 1 m, averaging 0.4 m thick beds) massive  quartz-feldspar-mica sandstone
with regular interbeds of thinly bedded to laminated siltstone, banded siltstone and mudstone-shale.
The Upper Highway Member represents a transitional sequence and  has gradational relationships
between the underlying Lower Highw ay Member and the overlying V ang Ngang Formation. It
displays variable thickness laterally across the Sepon district. In some areas (particularly from Houay
Yeng to Nampa) it is very difficult to map as a distinct unit a nd may not be present at all and the
Lower Highway Member appears to be in direct contact with the V ang Ngang Formation siltstones
and/or cherts.
2. Vang Ngang Formation
The Vang Ngang Formation is characterised by very well bedded, thin (2 cm-15 cm) and rhythmically
bedded red and green siltstone with lesser sandstone that is ty pically silicified to chert. Unlike the
underlying Highway Formation, the Vang Ngang sediments are non- micaceous. The cherts are
underlain by a limestone unit that locally occurs at the bounda ry between the underlying Highway
Formation and overlying Vang Nga ng cherts, which serves as a marker unit. The limestone is
typically a light grey colour, non-fossiliferous and massive with little internal structure apart from
stylolites. In the Ban Salo area is contains sub-vertical veins  of barite. The top of the Vang Ngang
Formation is marked by the Graptolite Member shales which is a thin unit of laminated, thinly bedded
black carbonaceous to graphitic shales containing common graptolite fossils. The Graptolite member
is commonly silicified or “cherty” at its base.
3. Kengkeuk Formation
The Kengkeuk Formation consists of black laminated calcareous, carbonaceous shales with rare
nodular texture. In the upper parts of the Kengkeuk Formation, the shales become more calcareous,
with discrete beds/lamina of carbonate and sand to gravel sized crinoid clasts.  Limestone / dolomite
talus breccias are common in the upper parts of the formation. Overall, the unit was deposited in a
shallowing upwards succession, ranging from deep-water basinal shales in the lower sections, up to
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proximal fore-reef slope breccias (or even reef margin) in the upper portions of the unit. The upper
carbonate-rich portion of the unit represents a carbonate slope  succession that was probably
deposited in front of a prograding reef system.
4. Namphuc Formation
The Namphuc Formation, comprising andesite-pebble to cobble con glomerates and volcanic rocks
grading to siliceous conglomerates, occur at, or close to the b ase of the Kengkeuk formation. The
Namphuc volcanics sporadically outcrop adjacent to several unit s and therefore the base of the
volcanic unit likely represents an unconformity.
5. Nalou Formation
The Nalou Formation is a platfo rmal carbonate succession that has been almost completely
dolomitized throughout the Sepon basin. The Nalou Formation is divided into five units:
 Lower laminated unit
 Lower dolomite-mudstone unit
 Laminated dolomite unit
 Upper bioclastic unit.
 Upper pale bioclastic unit (laterally restricted)
6. Discovery Formation
The Discovery formation is characterized by 200 m-300 m of grey  - black to tan weathered nodular
calcareous mudstone, with minor bioclastic material near the base of the formation.
The nodular calcareous mudstones grade upwards to planar laminated calcareous mudstone,
siltstone and sandstone of the Nam Kian formation. In some area s a narrow bioclastic dolarenite to
algal dolarenite - dololutite layer occurs at the contact betwe en the Discovery and Nam Kian
formations mudstone.
7. Nam Kian Formation
The Nam Kian formation contains variably carbonaceous and calca reous, well laminated and well
bedded shale mudstone, siltstone, sandstone and minor chert.
8. Phabing Formation
Overlying and potentially locally interbedded with the Nam Kian Formation is the Phabing limestone,
characterized by pale grey to dark grey limestone with abundant stylolites, sometimes nodular, locally
resulting in a light to dark grey striped appearance. The minimum thickness of this formation together
with Nam Kian formation is 400 m. This formation forms the dist inctive karst hills at Phabing and
south of Phavat.
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Figure 6-3: Sepon Stratigraphy Log

Structures
The dominant structural grain of the Sepon basin strikes E to ENE and is controlled by the preferential
alignment of basin-related fault structures and generally shallowly to moderately N dipping bedding
planes.  Dip value variations can be attributed to (locally tig ht) folding and faulting. Two main fold
axis trends have been recognized in the Sepon Basin. The domina nt fold generation strikes E to
ENE, has wavelengths varying up to kilometre-scale, and are ope n folds. The E to ENE trending
folds are deformed by N-trending folds as can be seen at Houay Bang and Houay Payee. The N-
trending folds are typically broad open structures with wavelengths of 100’s of meters. Tight, m-scale
folds of varying orientation have also been documented across the district. These folds are typically
associated with faults and their presence can be used as a tool to map brittle structures.
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Dominant fault directions are NW (parallel to the Truongson Fault zone) and E to ENE. The NW and
E to ENE faults typically dip steeply to the north and south and accommodate variable, but in some
instances considerable (e.g. NW-trending Muang Luang Fault), st rike-slip and dip-slip offset. The
NW faults typically cut the E to ENE trending faults but are th ought to have developed broadly
contemporaneously in response to movement along the Truongson Fault.
Magmatic Rocks
Rhyodacite Porphyry (RDP), minor andesite, and rare lamprophyre  are the only intrusive rocks to
have been recognized within the Sepon district. The RDP has a r emarkably consistent composition
and morphology throughout the area with quartz and feldspar phenocrysts (2 mm-5 mm across) set
in an aphanitic groundmass. No equigranular, crowded or megacrystic textures have been observed.
A quartz-poor RDP variant has been identified that appears to b e spatially associated with Cu
mineralization at Thengkham East and South.
Three major intrusive centres occur across the Sepon district; the Thengkham, Padan and Kaban
intrusive centres. The majority of primary gold mineralisation at potentially economic grade is located
between the Thengkam Intrusive center in the W and the Padan Intrusive center in the East. These
bodies are associated with intense quartz-dominated stock-work veins, and hornfels/skarn alteration
of the wall rocks which result in them forming resistive hills. At Thengkham the RDPs are composed
of abundant sills, dykes and intrusions with irregular geometries. RDP stocks, sills and dykes have
also been mapped at Nakachan, Ban Mai, Katia, and Phu Xo. These  porphyry occurrences form a
broadly E trending linear across the Sepon district. Numerous R DP dykes also cut the sedimentary
sequence, mainly within steep W- or NW- trending fault zones, b ut also along relatively flat-lying
structures such as bedding planes or formational contacts.
Gold and Copper Mineralization
Gold and copper mineralization in the Sepon deposits has many similarities to the sediment-hosted
replacement style deposits of the Great Basin, Nevada: host roc ks comprise mid-Palaeozoic aged
calcareous and carbonaceous sediments; high-angle faults serve as fluid conduits and are major ore
controls; ore-bodies are generally tabular to rod-shaped; alteration is characterized by the dissolution
of carbonate minerals and the pr ecipitation of silica (jasperoi d); gold is generally ultra-fine and
intimately associated with pyrite; base metal levels are typically low. Significant differences between
Sepon and the Great Basin Carlin-type deposits include the age of gold mineralization – Permian
versus Late Eocene respectively, and the tectonic setting – com pressive versus extensional
respectively. Although the Sepon mineralization shares many characteristics with the Carlin-type of
mineralization, it may more accurately be described as “distal- disseminated Au-Ag”, due to its
position within a possible zoned, porphyry intrusive centred system.
In the Sepon Project area, gold and copper mineralization has been discovered in a carbonate basin
as illustrated in Figure 6-4.  Different mineralization types of deposits have been identified, such as
skarn associated copper, carlin gold, orogenic gold, and superg ene gold deposits.  Some of the
deposits have been mined out and some are to be developed.
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Figure 6-4: Sepon Carbonate Basin and Mineralization Types

Alterations
There are 14 alteration subtypes that have been recognized in the three broad alteration zones. The
earliest documented intrusion-related alteration/mineralization  events are K-silicate alteration and
associated A-type quartz stock working, hornfels and prograde skarn. Distal to, and transitional with,
K-silicate alteration is propylitic alteration, which is common ly observed in the internal cores of
rhyodacite porphyry sills adjacent to prograde skarn or K-silicate front. Observed to overprint the K-
silicate and prograde skarn alteration types is phyllic alterat ion, retrograde skarn and carbonate
replacement. A texture-destructive equivalent of the phyllic zone is silica-pyrite alteration where there
is pervasive and intense replacement of fine to coarse grained quartz and >10 % vol pyrite.
Overprinting the above alteration types is intermediate argillic alteration, which is commonly texturally
destructive because of the increase in clay minerals. Silicification is a long-lived and pervasive event
in these magmatic hydrothermal systems spanning across the porp hyry Mo, skarn and jasperoid
front. Alteration associated with the sediment-hosted Au system s is typically silicification,
decalcification and dolomitization.
6.3 Deposit Types
This chapter describes the mineral deposit type(s) being invest igated or being explored for and the
geological model or concepts being applied in the investigation  and on the basis of which the
exploration program is planned
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6.3.1 Copper and Gold M ineralization types
Mineralization styles of the S epon district can be classified a s an intrusion-centred hydrothermal
system with the majority of known Cu and Au mineralization spatially associated with the Padan and
Thengkham porphyry centres. Mineralisation typically displays a zoned pattern in both mineralization
type and metal content. Porphyry Mo-Cu systems occur at the cor e zoning outward through skarn
and carbonate replacement Cu deposits to the Au dominated sediment-hosted systems which show
Carlin type deposit characteristics (Figure 6-5). Pb-Zn mineralization occurs distal to the porphyry’s
contact metamorphic aureole in a sediment-hosted setting, though a genetic link is yet to be
confirmed.
Figure 6-5: Relationship between magmatic rock bodies and miner alization types

Main intrusive centers that control the location of copper mine ralisation (proximal) and gold
mineralisation (distal) are discussed below.
The dominant style of mineralization in the Sepon mining distri ct is micro disseminated sediment-
hosted gold localized in combined structural, rheological and c hemical traps. Gold mineralization
occurs closely associated with decalcification of calcareous sh ale and irregularly distributed silica
replacement (jasperoid) bodies. The geometry of the deposits is  controlled by the interplay of
shallow-dipping lithological contacts (dominantly Nalou-Discovery Formation contact) and high-angle
faults, forming tabular to rod-like ore bodies. Faults as well as formation contacts often coincide with
porphyry margins suggesting that  intrusion as well as auriferou s fluids exploited similar crustal
pathways.
Gold mineralization is associated with elevated concentrations of arsenic, antimony and locally
thallium which is also evident i n the extensive soil sampling d ataset that covers the Sepon mining
district.
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Figure 6-6: Schematic Cross-Section showing Relationship betwee n magmatic rock bodies
and mineralization types of Sepon Project

6.3.2 Main Factors of Metallogeny
Three major controls on the distribution of gold and copper min eralization in the Sepon Basin have
been identified. The primary control is understood to be the po rphyry centres around which there is
a metal zonation. Secondary control is the structural architecture (faults and folds). In the case of Au
mineralisation there seems to be a strong (third order) litholo gical control where gold dominantly
occurs along or close to the Nalou-Discovery formation contact which acts as a favourable receptive
region.
 Primary Control
The bulk of the mineralisation across the Sepon district is spa tially associated with RDP intrusive
centres. All known copper deposit s are immediately adjacent to intrusive centres and the main
sediment-hosted gold zone is located between two of the largest  intrusive centres and located in a
peripheral position with respect to the molybdenum and copper zones.
 Secondary Control
The structural architecture around the margins of the intrusions is a key control on the distribution of
mineralization. NW to WNW and E to ENE faults localise mineralization from district to outcrop scale
and likely acted as the main conduits for mineralizing fluid. These faults provided traps and focused
fluids into other depositional sites such as lithological conta cts and fold axes. Much of the
mineralization occurs to the east and west of the intrusive cen tres, rather than the north or south.
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This also likely relates to the overall architecture of the basin and more specifically the orientation of
favourable feeder structures like NW- and E- striking faults.
 Ternary Control
Lithological receptivity favourable factors include: (1) the re ceptivity of calcareous black shale, with
gold deposition accompanying decalcification and jasperoid deve lopment; (2) the rheological and
permeability contrasts between footwall rhyodacite porphyry sil ls or bioclastic dolomite and the
overlying calcareous shale; (3) the carbonate and clay content of formations Vang Ngang and
Kengkeuk and their amenability to forming skarn assemblages.
Petrologic, fluid inclusion and organic studies of drill core samples suggest temperatures >600°C for
alteration assemblages developed proximal to intrusions and 150°C-250°C for alteration associated
with sediment-hosted gold deposits. It has been estimated that ~4.5 km of stratigraphic section has
been eroded from above the currently exposed rocks.
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7 Exploration and its Quality Assurance and Quality
Control and Sampling
7.1 Exploration Programs
7.1.1 Exploration Programs of Go ld and Copper Deposits Prior to Chifeng Gold
The first campaign was greenfields exploration drilling. This d rilling was completed by RTZ during
the 1990s. Oxiana continued to u se the drilling and sampling pr otocols developed by RTZ after
acquiring the project. This drilling included the oxide gold dr illing in the neighbouring Discovery
deposit to the north of Khanong.
Oxiana encountered significant amounts of wet sample during RC drilling in Khanong.
In 2006 it was recognised that wet RC samples were subject to considerable downhole grade
smearing. This was demonstrated at Thengkham by drill holes TKN 035, a wet RC hole, which
returned 2m @ 5% Cu from 74.0 m plus 65.0 m at 6.4% Cu from 94. 0 m. This hole was twinned by
DD hole TKN077 which intercepted a 0.9m void from 72.2m, then 1 .8 m of copper carbonate
mineralisation at 41.0 % Cu fro m 73.1 m. The remainder of the hole was unmineralised dolomite.
This was interpreted as indicat ing that the copper carbonate mi neralisation self-stoped as TKN035
was drilled causing the second very long, high grade intersection.
In May 2006 the Sepon site adopted a policy of requiring no wet RC drilling of mineralised zones. If
wet RC sample was encountered the hole was stopped. Therefore, any RC drilling post 1/5/2006 is
restricted to pre-collars only or  was part of a sterilisation c ampaign.  Geologists and/or
geotechnicians supervised RC drill rigs at all times while diamond drill rigs were checked twice daily
by geology staff to ensure drilling practices were being follow ed. Drillers maintained drilling logs
which recorded the depth and number of drill runs as well as important information such as core loss
and ground conditions. In situations where errors were detected  in the core during processing,
drillers’ logs and field geologists’ notebooks could be consulted to rectify the error.
Drill holes collars have been surveyed by a range of methods in cluding total station survey
instrument, differential GPS, theodolite, handheld GPS and tape and compass over the past years.
Planned collar coordinates, which are generally surveyed using handheld GPS, were also recorded
for further check to the actual coordinates. The planned coordi nates are resurveyed by total station
in Sepon SPG06 grid system or differential GPS in the UTM IT60 grid system once drilling was
completed. The coordinates in UTM IT60 grid system are converte d to local Sepon SPG60 grid
system. As set in the database sy stem, the actual coordinates w ill not be entered into database if
the difference to the planned coordinates is greater than 20m. Further check was then conducted to
confirm the correct actual coo rdinates. All drill holes collars  survey are stored in the database and
ranked according to method and date of survey. Only the most re cent survey and the highest rank
survey are used for data extraction.
Collar validation was also performed by displaying the drill holes on screen against surface to check
visually if there is any collar that is off the surface. Drill holes collars which appear far away from
surface or outside of the project boundary are then investigated.
– IIIB-58 –
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Prior to June 2007, most downhole surveys were conducted by dri lling contractor using Eastman
Single-shot Cameras with the result recorded in a survey disc. Since June 2007, all downhole
surveys were conducted using Reflex camera which provides reading results digitally. The results
were then written manually by the driller on a piece of paper. Protocol dictates that surveys should
be taken at depths of 12m, 30m, 60m (then every 30m to the bott om of hole). Historically vertical
holes with depths of around 50m were not surveyed. These drill holes were drilled at high angles to
sub-horizontal mineralisation and hence any deviation is regarded as insignificant and immaterial to
resource estimation.
Core orientations were carried out at 18m intervals using china graph-tipped spear in the selected
holes. Post 2006, all core has been oriented using the electron ic ACE Reflex Core Orientation tool.
Segments of core were classified as having good, medium or poor quality bottom-of-hole lines (BOH)
or no BOH. The BOH line is used as the reference line for recor ding, presenting and interpreting
structural data.
Drilling contractors provide the downhole surveys to LXML. LXML geologists then check the survey
disc/form and initial the survey after having been checked Data is then entered into the database. All
surveys are entered into the database; however, if a survey is deemed to be erroneous a field in the
database is set to “reject”. Only data with accepted surveys ar e exported for use in resource
estimation. The grid to magnetic deviation at Sepon is 1° and s o and azimuth conversion problems
are inconsequential.
Downhole surveys were checked both mathematically in LaosDB (ma ximum deviation of 0.27º per
metre downhole where dip > -80º) and visually for excessive dev iation or unlikely hole traces. Any
obvious problems were identified and rectified in the database prior to export for use in the Mineral
Resource modelling. Neither the planned nor actual rig set up azimuth is recorded in the LaosDB.
A total of 1,321,787m of DD and RC drilling data is contained in the resource database, of this 85%
is geologically logged, and 98% of sampled intervals contain go ld and copper assays (15% of the
RC data was assayed but not logged).
Only samples within the mineralisation or geological domains are used in the estimations. There are
also some drillings within block model extents not used in estimations as they fall outside of the areas
of interest, or have suspicious assay results.
A total of 1,503 diamond holes ( 100,582.5m), 2,840RC drill holes (170,825.6m) and 13,661 grade
control RC holes (202,618.3m) were used to inform the Nalou block model.
A total of 1,022 DD (117,495m), 23,732 RC (not Grade Control) (175499.2m) RC drill holes and
45,635 RC Grade Control holes (764,831.8m) for a total of 1,057 ,826m were used to inform the
Discovery region block model.
Figure 7-1 summarized the drilling s that have been completed by  December 2022 in the Sepon
Project area.
– IIIB-59 –
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FOR THE SEPON GOLD AND COPPER MINE


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Figure 7-1: Drilling Programs comp leted in Sepon Project by December 2022

7.1.2 Exploration Programs of Go ld and Copper Deposits by Chifeng Gold
After Chifeng Gold took over the Sepon project, the exploration programs focused on discovering
new gold deposits in brownfield to supply the processing plant and keep on the production, as well
as discovering new types of mineralization in green field. Figure 7-2 and Figure 7-3 summarized the
exploration programs in 2021 and 2022.
– IIIB-60 –
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Figure 7-2: Exploration Programs completed in Sepon Project in 2021

Figure 7-3: Exploration Programs completed in Sepon Project in 2022

– IIIB-61 –
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7.1.3 Trenching
LXML conducted exploration work basically by its in-house personnel of the exploration department,
including trenching, drilling, and general geological survey and mapping.  Figure 7-4 shows trenches
used in the exploration programs.
Figure 7-4: Trenches used in the exploration in Sepon Project

7.1.4 Drilling
LXML conducted exploration work basically by its in-house personnel of the exploration department,
with different drilling rigs.  Figure 7-5 shows rigs LXML owns and uses in exploration programs.
Figure 7-5: Drill rigs used in the exploration in Sepon Project

– IIIB-62 –
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Diamond Drilling
Diamond drilling is carried out by a variety of track or skid mounted rigs with 3 m masts. Core barrel
lengths are usually 3 m, but sometimes 1.5 m. All diamond drill ing is wireline drilling. Drilling
productivity is hampered by the very clay rich ground resulting  in short run lengths. The diamond
drilling has predominantly used triple tube drilling methods to enhance recovery and mostly using a
HQ3 size core barrel. Core samples are usually collected over 1 m intervals but may range from 0.5-
1.5 metres in length to enable samples to be broken on litholog ical and mineralisation contacts.
Where possible RC pre-collars a re used to reduce drilling costs , which is also recorded in the drill
hole database.
Run by run recovery has been recorded for all diamond drilling carried out at Sepon and for all drill
runs. DD recovery averages 95% (based on length) and RC recover y averages 80% (based on
mass).
The recovery data is somewhat muddied by the recording of ‘cavi ties’ in the database. There are
some true cavities in the Khanong area (small caves that occur in dolomite or limestone). Originally
drillers recorded “cavity” when they encountered unconsolidated material inferred to have formed in
a cavity.
Since March 2014 this practice changed and that material is now  recorded as core loss, the term
cavity is only used on voids now.
Diamond drilling recovery improves with depth, reflecting the b etter drilling conditions and absence
of clay and unconsolidated fill.
Reverse Circulation Drilling
RC drilling is carried out by a variety of track mounted rigs w ith 6 m masts and rods. All hammers
are face sample with 5 ¼ inch bits and 3 ½ inch rods. No attempt is made to control the direction of
the hole. Boosters are not normally used. Exploration, Resource and grade control RC samples are
collected at 1.0 m downhole intervals. Representative rock chips are collected during the drilling and
logged on site by a geologist to establish the stratigraphic context of the sampling and to provide a
geological description of each sample.
No RC drilling has been carried out routinely by the Resource Geology department since 2006. RC
drilling at Khanong represents a large amount of the data used to estimate copper grades.
Each metre sample is weighed to assess drilling recovery prior to splitting. The average RC sample
weight for dry samples was 22.7kg. This compares to expected sample weights from a 5 ¼ inch hole
of 25 kg, assuming average supergene material density (1.8t/m3). Sample moisture is recorded and
has been summarised below.
About 26% of the RC samples were wet or moist out at Discovery, and 32% from Nalou was wet or
moist. This constitutes 31% of the total RC data for Discovery and Nalou metres.
Grade control drilling was used i n both Nalou and Discovery res ource models for the first time in
2019. This decision was made to better inform the model in term s of data density and produced
higher quality geostatistics.  It also allowed a small amount of material to be classified as measured
due to the greatly increased kriging efficiency.
– IIIB-63 –
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7.1.5 Mapping
Exploration surface interpretation and grade control bench mapp ing have been used in areas as
guidance to generate lithological and structural models. This geological information was further used
for interpreting the ore delineation when generating ore domain s. The Resource department at
Sepon does not do bench or pit wall mapping or surface mapping but relies on other departments for
this information.
7.2 Quality Assurance and Quality Control of the Exploration
Programs
The samples from multiple drilling of the Sepon project development. There are at least five batches
of drilling data that relate to these prospects:
 Pre-Oxiana (CRA/Rio Tinto) 1993-1999
 Oxiana Pre-Mining 2000-2002
 Oxiana Active Mining 2002-2006
 SPGRDP (Sepon Resource Development Program) 2006-2007
 LXML Resource and Exploration Drilling Programs 2007-2019
 LXML Grade Control Programs 2020-2022
The quality of the datasets from periods of 2020-2022 has been reviewed by SRK.
LXML developed a standard procedure in which quality control sa mples were inserted within the
sample stream in order to validate analysis and drill-core samp les. All of these protocols are also
located on the LXML intranet. Full QC reports can be found in monthly reports located on the Sepon
server.
LXML has prepared Core Sample Preparation for Lab Testing Standard Operating Procedure which
demonstrated the QA/QC procedures in the exploration. Quality control samples including standard
samples, blank samples and duplicated samples.
7.2.1 Standard Sample
Certified reference materials (standards) are inserted in the s ample stream. Currently, most
standards have been produced by Ore Research & Exploration and Grade Control. There were 71
standards used within the reporting period, and details are shown in Table 7-1.
Table 7-1: ALS and Sepon Lab Standards
Standard
Name METHOD ELEMENT UNITS NOMINAL
VALUE
STD
DEVIATION
DATA
SOURCE
Au_HG_OX_22 FA-AAS Au PPM 3.2 0.07 User
Au_HG_PR_22 FA-AAS Au PPM 6.94 0.16 User
Au_LG_21 FA-AAS Au PPM 1.31 0.04 User
Au_LG_OX_22 FA-AAS Au PPM 2.02 0.05 User
Au_LG_PR_22 FA-AAS Au PPM 1.58 0.04 User
Au_MG_21 FA-AAS Au PPM 2.04 0.07 User
Au_MG_PR_22 FA-AAS Au PPM 3.65 0.15 User
– IIIB-64 –
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Standard
Name METHOD ELEMENT UNITS NOMINAL
VALUE
STD
DEVIATION
DATA
SOURCE
Cu_HG2 FA-AAS Au PPM 0.115 0.004 LaosDB
Cu_N1 4A-ICP Au PPM 0.508 0.02 User
Cu_N2 4A-ICP Au PPM 0.388 0.014 User
Cu-A FA-AAS Au PPM 0.674 0.034 LXM-ACQ-GradeControl
Cu-B FA-AAS Au PPM 0.37 0.02 LXM-ACQ-GradeControl
Cu-C FA-AAS Au PPM 0.18 0.009 LXM-ACQ-GradeControl
Cu-D FA-AAS Au PPM 0.181 0.01 LXM-ACQ-GradeControl
Cu-E FA-AAS Au PPM 0.21 0.007 LXM-ACQ-GradeControl
Cu-F FA-AAS Au PPM 0.212 0.006 LXM-ACQ-GradeControl
Cu-G FA-AAS Au PPM 0.289 0.015 LaosDB
HG_Oxide FA-MD Au ppm 0.412 0.007 User
MG_Oxide FA-AAS Au ppm 0.196 0.007 User
OREAS_15Pc FA-AAS Au PPM 1.61 NULL LXM-ACQ-GradeControl
OREAS_50Pb FA-AAS Au PPM 0.841 NULL LXM-ACQ-GradeControl
OREAS_51P FA-AAS Au PPM 0.43 NULL LXM-ACQ-GradeControl
OREAS_52P FA-AAS Au PPM 0.183 NULL LXM-ACQ-GradeControl
OREAS_53Pb FA-AAS Au PPM 0.623 NULL LXM-ACQ-GradeControl
OREAS_54Pa FA-AAS Au PPM 2.9 NULL LXM-ACQ-GradeControl
OREAS_6Pc FA-AAS Au PPM 1.53 0.12 LXM-ACQ-GradeControl
OREAS_7Pb FA-AAS Au PPM 2.77 NULL LXM-ACQ-GradeControl
OX_Au_L6 FA-MD Au ppm 0.379 0.015 LaosDB
OX_Cu_L6 FA-MD Au PPM 0.462 0.01 User
OX_Cu_M6 MD-MD Au PPM 0.28 0.007 User
OX_H3 FA-MD Au ppm 4.99 0.06 User
OX_H4 UNK Au ppm 4.8 0.16 User
OX_M4 FA-MD Au ppm 3.29 0.085 User
OX_M5 FA-MD Au ppm 1.5 0.05 User
Ox-P1H FA-MD Au ppm 0.92 0.06 User
Ox-P1L FA-MD Au ppm 0.88 NULL User
Ox-P2H FA-MD Au PPM 2.08 0.07 User
Ox-P2L FA-MD Au PPM 1.94 0.08 User
PR01 FA-AAS Au PPM 1.03 NULL User
PR02 FA-AAS Au PPM 3.28 0.13 User
STD_F FA-AAS Au PPM 1.546 NULL LXM-ACQ-GradeControl
STD_G FA-AAS Au PPM 3.254 NULL LXM-ACQ-GradeControl
STD_H FA-AAS Au PPM 5.336 NULL LXM-ACQ-GradeControl
STD_OX_H2 FA-AAS Au PPM 5.03 NULL LXM-ACQ-GradeControl
STD_OX_H2 FA-AAS-40 Au PPM 5.03 NULL LXM-ACQ-GradeControl
STD_OX_H3 FA-AAS Au PPM 4.93 0.32 LXM-ACQ-GradeControl
STD_OX_H4 FA-AAS Au PPM 4.8 0.2 LXM-ACQ-GradeControl
STD_OX_L1 FA-AAS Au PPM 1.331 NULL LXM-ACQ-GradeControl
STD_OX_L1 FA-AAS-40 Au PPM 1.331 NULL LXM-ACQ-GradeControl
STD_OX_L2 FA-AAS Au PPM 1.48 NULL LXM-ACQ-GradeControl
STD_OX_L3 FA-AAS Au PPM 0.518 NULL LXM-ACQ-GradeControl
STD_OX_L4 FA-AAS Au PPM 1.36 NULL LXM-ACQ-GradeControl
STD_OX_M2 FA-AAS Au PPM 3.41 NULL LXM-ACQ-GradeControl
STD_OX_M2 FA-AAS-40 Au PPM 3.41 NULL LXM-ACQ-GradeControl
STD_OX_M3 FA-AAS Au PPM 0.642 NULL LXM-ACQ-GradeControl
STD_OX_M4 FA-AAS Au PPM 3.29 NULL LXM-ACQ-GradeControl
STD_OX_M5 FA-AAS Au PPM 1.47 0.05 LXM-ACQ-GradeControl
STD_OX_P1H FA-AAS Au PPM 0.926 0.039 LXM-ACQ-GradeControl
STD_OX_P1L FA-AAS Au PPM 0.885 0.028 LXM-ACQ-GradeControl
STD_OX_P2H FA-AAS Au PPM 2.08 0.04 LXM-ACQ-GradeControl
STD_OX_P2L FA-AAS Au PPM 1.94 0.08 LXM-ACQ-GradeControl
STD_SEP05_1 FA-AAS Au PPM 0.574 NULL LXM-ACQ-GradeControl
STD_SEP05_1 FA-AAS-40 Au PPM 0.574 NULL LXM-ACQ-GradeControl
STD_SEP05_2 FA-AAS Au PPM 0.307 NULL LXM-ACQ-GradeControl
– IIIB-65 –
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Standard
Name METHOD ELEMENT UNITS NOMINAL
VALUE
STD
DEVIATION
DATA
SOURCE
STD_SEP05_3 FA-AAS Au PPM 2.55 NULL LXM-ACQ-GradeControl
STD_SEP12_1 FA-AAS Au PPM 0.36 0.01578 LXM-ACQ-GradeControl
STD_SEP13 FA-AAS Au PPM 0.15 0.021 LXM-ACQ-GradeControl
STD_SEP14 FA-AAS Au PPM 1.03 0.026 User
STD_X FA-AAS Au PPM 1.44 NULL LXM-ACQ-GradeControl
STD_Y FA-AAS Au PPM 0.79 NULL LXM-ACQ-GradeControl
7.2.2 Duplicates
Two types of duplicates are us ed for monitoring laboratory’s pr eparation and analytics: field
duplicates and lab duplicates.
Reverse circulation field duplicates have been prepared using a  single tier riffle splitter. The larger
sample size submitted for analysis has shown better repeatability than diamond drill field duplicates.
Analytical duplicates are prepared by taking duplicate splits after pulverization of the sample material.
Lab duplicates are prepared by taking duplicate rotary splits after finer (-2mm) crushing of the sample
material.
7.2.3 Blanks
Pulp and coarse blanks are inserted into the sample stream at the Sepon core shed operational area.
Presently, on average, coarse blanks and pulp blanks standards are inserted at sta rt of each drill
holes and thereafter at a rate of one in every 20 samples.
The Coarse Blank consists of crushed limestone sourced from the  limestone pit within Sepon mine
site. Analysis of the samples was done by ALS-Lab and Sepon Lab. The Coarse Blank used in Sepon
has some detectable presence of Au based on the results of the analysis done by ALS.
Pulp Blank is mainly a hydrated lime originally placed in 25 kg  rice bags.  They are then re-packed
by onsite samplers who scoop it into foil pouches for insertion . The source of the sample is from
Vietnam
The blanks occasionally show some low-level contamination (<0.0 4 g/t maximum). It is uncertain if
this should be attributed to the blank source material - establishment of a background baseline value
should eliminate most of the noise associated with background mineralisation.
7.2.4 QA/QC Performance
The procedure of inserting control samples was routinely carrie d out over the entire exploration
programmes. The control samples include pulp duplicates, coarse rejects and reference standards.
Internal check and external check data from JM exploration between 2020 and 2022 were provided
to SRK, and the main elements were Au, Cu and Ag.
a. Duplicate
Two types of duplicates are us ed for monitoring laboratory’s pr eparation and analytics: field
duplicates and lab duplicates.
– IIIB-66 –
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The Au field duplicate samples are general acceptable, among al l 11443 field duplicate samples,
42% of which are below 10% relative difference and 63% of which are below 20% relative difference;
the Ag field duplicate samples are general acceptable, among all 1699 field duplicate samples, 47%
of which are below 10% relative difference and 71% of which are below 20% relative difference; the
Cu field duplicate samples are general acceptable, among all 19 59 field duplicate samples, 58% of
which are below 10% relative difference and 79% of which are below 20% relative difference.
The Au field duplicate sample performance is not as good as Cu and Ag due to more nugget effect
of Au, about 37% field duplicate samples are greater than 20% r elative difference. The Au Lab
duplicate samples are general acceptable, among all 177 Lab duplicate samples, 39% of which are
below 10% relative difference and 61% of which are below 20% re lative difference; the Ag Lab
duplicate samples are general acceptable, among all 79 Lab dupl icate samples, 52% of which are
below 10% relative difference and 68% of which are below 20% re lative difference; the Cu Lab
duplicate samples are general acceptable, among all 94 Lab dupl icate samples, 62% of which are
below 10% relative difference and 86% of which are below 20% re lative difference. The Au Lab
duplicate sample performance is not as good as Cu and Ag due to  more nugget effect of Au, about
39% Lab duplicate samples are greater than 20% relative differe nce. The field and lab duplicate
samples performance are shown below.
Figure 7-6: Field and Lab Duplicat e Au Ag and Cu Plot of Control Sample Programme

– IIIB-67 –
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b. Reference Standards
There were 71 standards used for monitoring laboratory’s preparation and analytics.
SRK selected standards with large quantities for statistical analysis: Au_LG_21 Au_MG_21 OX_H4
OX_M5 Ox-P1H Ox-P2H and Ox-P2L.
According to the comparison curves between the standard sample reanalysis results and the
standard grade values in Figure 7-7, the Au analysis results of each standard sample are fluctuating
within 20% around the standard value.
– IIIB-68 –
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Figure 7-7: Performance of standards of Sepon


– IIIB-69 –
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– IIIB-70 –
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– IIIB-71 –
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c. Blanks
The blank samples are the original blank sample, and the comparison of blank samples is shown in
the figure below. The value of 5 samples exceeds the detection limit of 10 times, and the qualified
rate is 92.1%. The blank samples performance is shown below.
– IIIB-72 –
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Figure 7-8: Performance of blanks of Sepon
– IIIB-73 –
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7.2.5 SRK Comments
SRK considers that, QA/QC performed during 2020-2022 for Sepon mine are consistent with
generally accepted industry practices and are therefore adequate for resource estimation.
7.3 Sample Preparation, Analyses, and Security
7.3.1 Sample Preparation and An alyses of Gold and Copper Deposit
Sample preparation is the most critical step in the entire Laboratory operations and it must provide a
homogeneous analytical sub-sample that is representative of the sample submitted to the laboratory.
Samples on arrival at the Laboratory are logged into the ALS tr acking system with a bar code label
attached. Samples are then dried in an oven at temperature of a bout 110 degrees followed by
crushing of rock chips and drill samples to 70% of the sample passing 2mm. The samples are then
split using the riffle splitter 250g and are pulverised to 85% less than 75 microns
The analytical methods employed at Sepon site have varied little over the years. The current assay
protocol used by the Sepon Resource department is shown below in Table 7-2.
Table 7-2: Current Sepon Resource Assay Protocol
PROTOCOL METHOD TRIGGER LAB ELEMENTS ANALYZED
321 ALS-
SepCu+IR07
Au-AA25
  ALS
Au
ME-ICP61 Ag,Al,As,Ba,Be,Bi,Ca,Cd,Co,Cr,Cu,Fe,Ga,K,La,
Mg,Mn,Mo,Na,Ni,P,Pb,S,Sb,Sc,Sr,Th,Ti,Tl,U,V,W,Zn
– IIIB-74 –
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+Cu-
PKGPH06
S-IR07 S_S (Sulphide Sulphur)
Cu-OG62 >0.5%Cu
for OG62 Cu
CuCN-PH06 >0.2% for
Sequential
Cu-
PKGPH06
Cu (Cyanide Leach Soluble)
CuR-PH06 Cu (4 Acid Soluble)
CuS-PH06 Cu (Sulphuric Acid Soluble)
CuT-PH06 Cu (Calculated Total)
Notes
1 ME-ICP61 Four Acid Near Total- ICP Multi-element Method
2 ME-OG62 Four Acid Near Total Assay Grade Multi-element Method
3 Au-AA25_26 Fire Assay Gold AAS finish
4 IR07 Total S by Lecco Furnace IR – provides sulphur speciation (sulphide sulphur and sulphate sulphur)
5 PKGPH06 - Sequential Copper CuCn-PH06 (Cu Cyanide leach soluble ), CuS-PH06 (Cu Sulphuric Acid leach soluble),
CuR-PH06 (Cu 4 acid digest soluble) and CuT-PH06 (Cu calculated total based on all 3 methods of leach).
7.3.2 Bulk Density
Historically, various estimations of the wax density have been undertaken; in February 2014. R.
Berthelsen and A. Lewin (MMG) confirmed that the density used in the calculation of specific gravity
(“SG”) in the database is correct. The review formed part of a larger Mineral Resource site review
(Sepon resource report 2014).
Samples for bulk density determination are taken from diamond d rill core every 10m using wax
coated core immersion method; however, in 2015 sample interval was changed to 5m interval. This
is to reduce the wide range of sample selection interval hence to allow for more oxide material
selection.
Density data was collected for all rock types during each drilling program from 1993 to 2016. During
the period 1993-1999 (Rio Tinto International, "RTI"), the fiel d procedure for determining density
values changed several times, as summarised by Loader and Curtis (1999). Various techniques for
SG measurement have been used in the past. Only SG determination using the Archimedes method
(with or without wax coating) has been used in the Mineral Resource models, all other methods are
flagged for exclusion in the database.
The bulk density determinations were estimated into both Nalou and Discovery models as there is
sufficient data density per rock type to enable ordinary kriging efficiencies over 50%.  All SG’s were
validated both visually and statistically, with errant SG values being flagged in the Leapfrog database
for exclusion.  The flagged field has been sent to the Sepon database administrator to address in the
main database.
7.3.3 Database Management
The Sepon Exploration and Resource database system consists of three components, one manual
and two digital. These are a manual on Field Logging System, a Data Entry Database (DEDB), and
a Master Database (LaosDB). Each digital component is configure d to run in SQL Server with user
access and permissions controlled by domain logins.
The databases are backed up incrementally 8 hourly (kept for 5 days on the server) and fully daily
(kept for 2 weeks on the server ). IT incrementally back up the servers to tape daily, with the tapes
– IIIB-75 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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kept in the server container for a week. Full back ups of the s ervers are conducted weekly and the
tapes stored both in the admin building and offsite at the LXML Vientiane office.
7.3.4 SRK Comments
In the opinion of SRK, the sampling preparation, security and a nalytical procedures used by LXML
are consistent with generally accepted industry best practices and are, therefore, adequate.
– IIIB-76 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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8 Data Verification
8.1 Verifications by SRK
SRK has arranged to re-sample a total of 83 pulps from drilling  holes DIS745, DIS747, DIS750,
DIS761 and KHN1154 to check the repeatability and accuracy of t he assay results for the Sepon
project. The pulp samples details are listed in Table 10.1 below.  SRK has also visited and collected
12 rock chip samples at Discovery West Pit (DSW), Nalou Pit (NIU), Thengkham East Pit (TKE) and
Thengkham North Pit (TKN) to verify the mineralization types an d grades, and has these samples
assayed at the ALS Global Australia (Table 8-1 and Table 8-2).
These pulp samples show gold and copper re-assay values with a 8.18% and 14.65% difference
from the respective original assay values from the primary assa y lab. It clearly verifies the general
tenor of pertinent exploration data, and SRK believes that thes e data have been verified to a
reasonable extent.
Two types of duplicates are us ed for monitoring laboratory’s pr eparation and analytics: field
duplicates and lab duplicates.
The rock samples from three different pits show the various min eral mineralizations such as carlin
type gold mineralization, skarn and hornfelsed copper mineraliz ation, hydrothermal gold- copper-
molybdenum mineralization.
Table 8-1: Comparison with Re- assay by SRK and Original Assay f rom Sepon for Drilling
Cores
Hole_ID
D_FRO
M
(m)
D_TO
(m)
Sample
Type
Sample
ID
Original Assay Re-Assay Diff(%) Weight
(g) Au
(g/t)
Cu
(%)
Au
(g/t)
Cu
(%) Au Cu
DIS745 121 122 Pulp D5096913 0.7 0.67  3.03 450
DIS745 122 123 Pulp D5096914 1.5 1.54  3.97 410
DIS745 123 124 Pulp D5096915 1.7 1.62  -6.57 450
DIS745 124 125.3 Pulp D5096917 1.2 1.09  -5.36 500
DIS745 125.3 126 Pulp D5096918 0.5 0.46  -6.32 430
DIS745 126 127.2 Pulp D5096919 0.7  0.69  -  480
DIS745 127.2 128 Pulp D5096920 3.9 3.05  -23.44 430
DIS745 128 129 Pulp D5096921 1.7 1.67  -2.95 290
DIS745 129 130 Pulp D5096922 3.2 3.02  -6.10 340
DIS745 130 131.4 Pulp D5096923 4.2 4  -4.40 290
DIS747 131 132 Pulp D5097107 0.5 0.52  -1.90 450
DIS747 132 133 Pulp D5097108 1.4 1.44  2.82 370
DIS747 133 133.5 Pulp D5097110 0.9  0.92  3.31  390
DIS747 133.5 134 Pulp D5097111 1.1 1.28  19.74 420
DIS747 134 135 Pulp D5097112 6.1 6.09  -0.65 300
DIS747 135 135.5 Pulp D5097113 6.6 7.24  8.95 370
DIS747 135.5 136 Pulp D5097115 28 30.5  9.03 400
DIS747 136 137 Pulp D5097116 16 16.7  6.05 390
DIS747 137 138 Pulp D5097117 14  18.9  28.61  390
DIS747 138 139 Pulp D5097118 3.9 3.97  1.27 360
DIS747 139 140 Pulp D5097119 3.9 3.99  2.03 370
DIS747 140 141.3 Pulp D5097120 4.8 4.74  -1.88 330
DIS747 141.3 142 Pulp D5097121 12 11.6  -0.35 320
DIS750 137 138 Pulp D5097471 1.1 1.1  2.76 350
DIS750 138 139 Pulp D5097473 0.8 0.8  -3.68 460
DIS750 139 140 Pulp D5097474 21  32.8  42.01  410
DIS750 140 141 Pulp D5097475 7.9 8.35  5.29 470
DIS750 141 142 Pulp D5097476 3.3 3.33  1.21 470
DIS750 142 143 Pulp D5097477 1.2 1.17  0.86 340
DIS750 143 144 Pulp D5097478 12 18.3  43.35 340
DIS750 144 145.1 Pulp D5097479 1.3 1.77  31.37 350
DIS750 145.1 146 Pulp D5097480 2.3  2.28  -2.17  380
DIS750 146 147 Pulp D5097481 2.2 3.17  36.57 470
DIS750 147 148 Pulp D5097482 3.5 3.68  3.88 580
DIS750 148 149 Pulp D5097484 1.1 1.17  3.48 500
– IIIB-77 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Hole_ID
D_FRO
M
(m)
D_TO
(m)
Sample
Type
Sample
ID
Original Assay Re- Assay Diff(%) Weight
(g) Au
(g/t)
Cu
(%)
Au
(g/t)
Cu
(%) Au Cu
DIS750 149 150 Pulp D5097485 1.2 1.31  5.49 480
DIS750 150 151 Pulp D5097486 2.4 2.55  4.82 520
DIS750 151 152 Pulp D5097487 3.3 3.56  8.80 490
DIS750 152 153 Pulp D5097488 1.2 1.95  48.41 480
DIS750 153 154 Pulp D5097489 1.1 1.1  - 570
DIS750 154 155 Pulp D5097490 1  1.02  -1.94  480
DIS750 155 156 Pulp D5097491 1.9 1.91  1.58 320
DIS761 166 166.6 Pulp D5127483 0.1 0.05  -18.18 510
DIS761 166.6 168 Pulp D5127484 1.3 1.33  2.28 470
DIS761 168 169 Pulp D5127485 4.2 4.24  1.90 450
DIS761 169 170 Pulp D5127486 0.9 2.46  94.61 470
DIS761 170 171 Pulp D5127487 1.1 1.1  -0.90 490
DIS761 171 172 Pulp D5127488 2.2  2.4  7.79  470
DIS761 172 173 Pulp D5127489 2.9 3.03  5.08 490
DIS761 173 174 Pulp D5127490 24 22.5  -6.32 430
DIS761 174 175 Pulp D5127492 5.1 6.22  20.18 340
DIS761 175 176 Pulp D5127493 3.7 3.96  8.15 410
DIS761 176 177 Pulp D5127494 1.5 1.65  12.22 410
DIS761 177 178 Pulp D5127495 1.2  1.69  32.30  370
DIS761 178 179 Pulp D5127496 2 2  - 370
DIS761 179 180 Pulp D5127497 3.9 4.7  18.10 410
DIS761 182 183 Pulp D5127500 4.9 5.08  4.22 350
DIS761 183 184 Pulp D5127501 3.9 4.46  14.42 390
DIS761 184 185 Pulp D5127503 2.7 3.19  15.91 480
DIS761 185 186 Pulp D5127504 1.8  1.84  1.09  390
DIS761 186 186.6 Pulp D5127505 1.8 2.23  20.25 410
DIS761 186.6 188 Pulp D5127506 0.5 0.57  13.08 400
KHN1154 200 201 HCHQ D2212912  1.35  1.42  5.10 1980
KHN1154 201 202 HCHQ D2212913  0.73  0.93  24.64 1840
KHN1154 202 203 HCHQ D2212914  2.46  3.45  33.43 1970
KHN1154 203 204 HCHQ D2212915  0.64  1.04  47.99 1710
KHN1154 204 205 HCHQ D2212916  0.99  1.24  22.54 1750
KHN1154 205 206 HCHQ D2212918  1.22  1.01  -18.86 1790
KHN1154 206 207 HCHQ D2212919  3.89  3.58  -8.26 1700
KHN1154 207 208 HCHQ D2212920  1.03  0.91  -11.82 1810
KHN1154 208 209 HCHQ D2212921  3.99  5.29  27.93 1960
KHN1154 209 210 HCHQ D2212922  5.84  8.59  38.11 1910
KHN1154 210 211 HCHQ D2212924  4.28  5.00  15.55 2420
KHN1154 211 212 HCHQ D2212925  3.4  4.19  20.84 1880
KHN1154 212 213 HCHQ D2212926  1.61  1.97  20.17 1830
KHN1154 213 214 HCHQ D2212927  0.89  0.99  11.41 2020
KHN1154 214 215 HCHQ D2212928  0.94  0.88  -6.79 1970
KHN1154 215 216 HCHQ D2212930  0.19  0.23  19.30 2120
KHN1154 216 217 HCHQ D2212931  0.36  0.41  12.11 1960
KHN1154 217 218 HCHQ D2212932  0.16  0.13  -20.30 1880
KHN1154 218 219 HCHQ D2212933  1.31  1.20  -8.52 2040
KHN1154 219 220 HCHQ D2212934  0.45  0.92  69.20 1660
Total
sample    82     8.18 14.65
– IIIB-78 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Figure 8-1: Au Comparison with Re-assay by SRK and Original Ass ay from Sepon for
Drilling Cores

Figure 8-2: Cu Comparison with Re-assay by SRK and Original Ass ay from Sepon for
Drilling Cores

Table 8-2: Assay Report for Rock Samples from Sepon by SRK 2022
Prospect Pit name SPL_ID Cu (%) Au(g/t) W(Kg) Comment
DSW Discovery West_A1 pit R328792 <0.01 0.35 1.2  Au, 6-9 g/t
NLU Nalou_ Pit R328793 <0.0 1 4.84 2 Au, 3-5 g/t
TKE Thengkham East pit R328794 5.15 2.99 3.8 Cu, 0.5-1.0 %
0.0
2.0
4.0
6.0
8.0
10.0
12.0
0.0 2.0 4.0 6.0 8.0 10.0 12.0
Duplicates_Au g/t
Original_Au g/t
Au  ± 0%  - 20%
Data pairs: 64
Source:  Pulp Duplicate samples
0.0
2.0
4.0
6.0
8.0
10.0
12.0
0.0 2.0 4.0 6.0 8.0 10.0 12.0
Duplicates_Cu %
Original_Cu %
Cu  ± 0%  - 20%
Data pairs: 20
Source:  Pulp Duplicate samples
– IIIB-79 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Prospect Pit name SPL_ID Cu (%) Au(g/t) W(Kg) Comment
TKN Thengkham North A pit R328795 0.65 0.49 2.8 Cu_pri
TKN Thengkham North A pit R328796 1.25 0.18 2 Cu_pri
TKN Thengkham North A pit R328797 0.02 0.94 1.6 Cu_pri
TKN Thengkham North A pit R328798 0.38 0.08 2 Cu_pri
TKN Thengkham North A pit R328799 1.14 0.19 2.6 Cu_pri
TKN Thengkham North A pit R328800 0.37 0.56 2.6 Cu_pri
TKN Thengkham North A pit S174600 0.14 0.09 2 Cu_pri
TKN Thengkham North A pit S174601 0.98 0.41 2 Cu_pri
TKN Thengkham North A pit S174602 1.12 0.16 1.4 Cu_pri
Total   12 SPL     26
8.2 Site Visits
Dr. Anson Xu and Dr. Tony Guo from SRK team visited the Sepon property from 8 December 2022
to 14 December of 2022 (Figure 8-2 to Figure 8-4). Table 8-3 lists the details for all the sites visited.
Table 8-3: Sites Visited at  Sepon Property by SRK Team
Date Site Activities
Dec. 9 Mine camp Visited mine office and met mine senior officers and technical team
Dec.10
Discovery West A2-A3
pits, Nalou pit and
Theng-kham east pit,
Core shack
Visited DISW A2, A3 operation pits, Nalou and TKE pit; verified the
Calin-type sulfide Au mineralization and skarn type Cu mineralization,
collected samples R328792, R328793 and R328794 respectively;
visited drilling sites of holes PVN1233D1 and MBE036; Checked out
cores from holes PVN 1199, HYB163, DSW928, KHN1154, TKE454,
PVN1231D1, BME036, DSW039D1
Dec. 11
Discovery and Nalou
pits and underground
tunnel
Visited open pit operation, sighted mining equipment, checked out
mining designing and plan; visited underground tunnel and stopes
development
Dec. 12 TKN pits, Processing
plants and Laboratory
Visited TKN A pits and slope to check out the lower grade skarn and
hornfelzed Cu mineralization, collected rock chip samples from
R328796 to R328800, S174600, S174601; Visited processing plant,
floatation, high-pressure leaching tanks and laboratory
Dec. 13 Corporate office Visited corporate office and met mine senior officers and technical
team
– IIIB-80 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Figure 8-2: Black Colour Carbonate Hosted Carlin Type Au Minera lization at Discovery West
A2 Pit

Figure 8-3: Skarn Type Cu Minera lization at Slope Wall of TKN A Pit

Figure 8-4: Hydrothermal Cu-Au M ineralization in the Intrusive

– IIIB-81 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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In December 2023 and May 2024, SRK team conducted an additional  site visit to inspect other
technical aspects of open-pit and underground mining, ore proce ssing and smelter, as well as
environmental issues.
– IIIB-82 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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9 Mineral Processing and Metallurgical Testing
9.1 Gold Ores
9.1.1 Mineralogy
A comprehensive mineralogical study on 60 drill core samples from Sepon Gold Mine was conducted.
Sepon ores exhibit typical characteristics of refractory gold o res. In addition to occurring mainly as
submicroscopic gold and micron-size inclusions in arsenian pyri te, the presence of slow-dissolving
gold telluride, carbonaceous matter and arsenic-bearing Cu-Pb minerals makes gold extraction more
challenging.
Bulk mineralogy and gold deportment studies were conducted on 3 0 of the 60 core samples,
including 3 oxide ore samples and 27 primary samples. The miner alogical studies have concluded
that:
1. Sepon Primary ores exhibit typical characteristics of refractory gold ores. In addition to occurring
mainly as submicroscopic gold and micron-size inclusions in ars enian pyrite, the presence of
slow-dissolving gold telluride, carbonaceous matter and arsenic-bearing Cu-Pb minerals makes
gold extraction more challenging.
2. Grain size, liberation, association and chemistry of gold minerals (particularly gold tellurides) are
the major mineralogical factors affecting gold recovery by gravity, flotation and also cyanidation.
3. Since gold is intimately associated with arsenian pyrite, overall gold recovery will be dictated by
the efficiency and effectiveness of pyrite flotation, pressure oxidation and cyanidation.
4. Sepon Primary gold ores are composed mainly of silicate and car bonate minerals (including
quartz, dolomite, muscovite and calcite), with trace to minor a mounts of sulphide and other
minerals. Dolomite is a calcium-magnesium bearing carbonate, which will drive acid demand to
over 250 kg/t for the associated quantities within Sepon Primar y gold, making any processing
route uneconomical which includes acidification.
5. Sepon Primary gold can be classified as Carlin-type due to the presence of organic carbon. It is
well known that carbonaceous material in the Carlin-type ores i s detrimental to gold ore
processing due to its preg-robbing capability. The presence of organic carbon dictates that some
fraction of the Sepon Primary gold mineral inventory to be classified as double refractory.
6. Pyrite is the predominant sulphide mineral within Sepon Primary  gold ores. Pyrite occurs as
arsenian pyrite, mainly fine-grained (down to 1μm) and disseminated in silicate and carbonates.
Coarse pyrite (up to several hundred microns) is not common.
7. The grade of refractoriness varies among the primary gold pits; with Nalou and Namkok being
classified as highly refractory, while Discovery ore as mildly refractory.
9.1.2 Metallurgical Tests
The metallurgical response of Sepon Primary Ores has been evalu ated since 2005. The most
relevant testing data have been considered for the 2020 reformation design purposes. This includes
three different testing campaigns:
– IIIB-83 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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 Burnie Laboratory campaign 2004 – 2005
 Hazen Testwork campaign 2006 – 2007
 G&T Testwork campaign 2006-2008
 Ammtec Testwork campaign - 2010
 ALS Testwork campaign 2012 -2013
 BGRIMM Testwork campaign 2018 - 2019
The metallurgical samples used for these testing campaigns are considered representative of the
deposit.
9.1.3 GRG Test
A Gravity Recoverable Gold (“GRG”) test was conducted in the ye ar of 2019 BGRIMM testing
program. Under a grind fineness of 60% to 90% minus 74 microns，the gravity concentrate grade of
the Knelson concentrator is around 20 g/t with a gold recovery of only about 10%. The grinding
fineness had little effect.
During the 2013 ALS testing program, a GRG test using a master composite sample (P 80 = 53
microns) resulted in a gold reco very of 14.5%, with a mass pull  of 4.36%. The GRG test results
indicate that the gravity process is not feasible with the ultrafine dissemination of gold.
Flotation Test
The flotation response from Sepon Primary ores has received sig nificant attention in order to
maximise gold recovery. The tests were involved in the above te sting campaigns. The flotation
responses are illustrated in Figure 9-1 and summarized below:
 Gold flotation recovery is in line with the sulphur, arsenic, o rganic carbon and the mass pull of
the concentrate. The flotation time should be no less than 50 minutes.
 The optimal primary grind size is P80=53 μm. The regrind and re-flotation of the flotation tails
cannot improve the gold recovery.
 Flash flotation prior to conventional flotation can significantly improve the gold recovery.
Table 9-1 summarizes the results of four locked cycle flotation tests by BGRIMM.
Table 9-1: BGRIMM Flotation Test Results
Flotation Sheet Head Grade
(g/)
Concentrate
Grade  (g/t)
Mass Pull
(%)
Gold Recovery
(%)
Carbon pre-float 4.38 29.10 10.19 70.52
Conventional 4.38 18.31 18.64 78.04
Flash pre-float  4.38 16.94 21.32 81.24
Intensified flash pre-float 4.38 12.95 29.04 86.89
Source: Sepon Gold Project Study – Chapter 7 Metallurgy and Mineral Processing
– IIIB-84 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Figure 9-1: Sepon Primary Ore Flotation Response

Source: Sepon Gold Project Study – Chapter 7 Metallurgy and Mineral Processing
Pressure Oxidation
All pressure oxidation feeds were pre-acidulated with flotation  concentrate. The post POX residue
underwent the CIL process.
Hazen performed POX tests in bot h batch and pilot plant tests. Three batch tests gave consistent
CIL results of 93.7% - 94.2% gold recovery when the sulphide su lphur oxidation was around 95%.
The pilot plant produced CIL recoveries of 91.3% - 94.4% for pa rtially acidulated feeds. When the
feed was fully pre-acidulated the recoveries were 81% - 85%.
ALS POX tests confirmed the gold recovery ranges from 92% to 94%.
BGRIMM tests showed recoveries within 92.0% - 95.3%, and no regrind either lime boil was required.
Flotation Tails CIL
Historically cyanide leaching of flotation tails has been perfo rmed under aggressive leaching
conditions including 2,000 ppm sodium cyanide concentration. Under these conditions, the cyanide
consumption was over 4 kg/t, yi elding a non-economical business  proposition as additional gold
recovery was within 3% - 6%.
A pre-conditioning step and a lower cyanide concentration in th e CIL were tested. Cyanide
consumption was reduced to under 0.4 kg/t.
– IIIB-85 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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An additional test was performed by regrinding the flotation ta ils down to 10 microns; however
recovery was not improved highlighting the severe liberation is sue related to the non- recoverable
gold.
LXML Metallurgical Laboratory and Testing
The Sepon Gold Plant has been reformed to process oxide ore and  primary ore in a parallel mode.
The oxide ore is processed by the carbon-in-leaching (“CIL”) pr ocess, and the primary ore is
processed by the "flotation - concentrate POX - CIL process". The final product is Gold Doré. As both
the oxide and primary ores are refractory, the gold recoveries are low, with the oxide ore ranging
from 51.8% to 68.9% and primary ore ranging from 54.7% to 67.0%.
A metallurgical laboratory adjacent to the plants complex conducted metallurgical tests frequently on
the samples from different ore bodies and plant flow to optimis e the operation parameters for gold
recovery improvement. Figure 9-2 shows part of the metallurgical test equipment.
Figure 9-2: Part of Test Devices in Sepon Metallurgical Laborat ory

Source: SRK site visit
Tests of Reducing Mass Pull by Regrinding-Recleaning of primary  flotation concentrate have been
completed in the laboratory. A new plant for regrinding-reclean ing of primary concentrate is being
built to reduce the carbonates for acid saving of concentrate acidulation. The target regrind fineness
is P80=20μm, and the test results are shown in Table 9-2. Mass pull is ca pable of being reduced
down to ~15% via regrinding at a small cost to recovery (e.g., 1-2%). Correspondingly, the flotation
recovery of calcium which is the indicator for sulfuric acid consumption in acidification ahead of POX,
was reduced by 50% or more.
Table 9-2: Primary Concentrate Regrinding-recleaning Test Result
Reflotation Circuit  Mass Pull
(%)
Ca
Recovery
(%)
Au Recovery (%)
Flot POX-CIL Overall
Current Plant Circuit 29.10 17.1 86.8 78.0 67.7
Coarse Split Flotation - Regrinding 15.66 5.5 86.2 80.1 69.1
– IIIB-86 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Reflotation Circuit  Mass Pull
(%)
Ca
Recovery
(%)
Au Recovery (%)
Flot POX-CIL Overall
Regrinding 19.31 7.3 86.5 69.3
Coarse Split Flotation - Regrinding 16.90 6.0 86.3 69.1
Source: LXML- Reducing Mass Pull by Regrinding-Recleaning
The current laboratory test is re sin-in-Leach (“RIL”), using resin to replace activated carbon as the
gold adsorbent. It is expected to improve the gold recovery as that the strong adsorption capacity of
the resin can compete with organic carbon.
9.1.4 Conclusion and Recommendation
Sepon gold ores, both oxide and primary, are refractory due to the ultrafine deportment, the presence
of arsenic and antimony minerals and organic carbon.
CIL process is suitable for the gold extraction of oxide ore, but the gold recovery is low. The historical
production performance shows gold recovery ranging from 51.8% to 68.9%.
Flotation-POX-CIL process is suitable for the gold extraction o f primary ore. The flotation tests
indicate the gold recovery of flotation concentrate ranges from  85% to 90%, and the concentrate
POX-CIL recovery ranges from 92% to 94%.
Gravity concentration is not suitable for the processing of Sepon gold ores. The gold extraction rate
is as low as 3% to 6% for the flotation tails cyanidation.
The onsite metallurgical laboratory is well equipped. The frequ ent tests can guide the processing
plant operation to remain steady and achieve satisfactory result.
9.2 Copper ores
9.2.1 Introduction
Sepon oxide copper ores are processed using hydrometallurgical process including agitation
leaching and heap leaching, solvent extraction and electrowinning (“SX/EW”) of the pregnant leach
solution (“PLS”). The current copper plant adopts this process.
Supergene copper ores are processed using a unique hydrometallurgical process designed as an
alternative to flotation and heap leaching.
Primary copper mineralisation at Thengkham and at Khanong has been identified; however, this ore
contains chalcopyrite which the Sepon process was not designed to treat because chalcopyrite is
refractory under the designed leaching conditions.
The test study on primary copper ores is focused on flotation process to produce a saleable copper
concentrate.
– IIIB-87 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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9.2.2 Mineralogy
Seven primary ore samples from Thengkham East were examined for  mineralogy by ALS in 2008.
The mineral composition is listed in Table 9-3 for the seven sa mples. Nearly all of the copper was
present as chalcopyrite. Minor tennantite and bornite, accounting for less than 3% of the total copper,
were found in some of the samples. Pyrite was the other main su lphide mineral, varying from 0.2%
to 10% in the samples. Gangue minerals varied between the sampl es. The major gangue minerals
were dolomite, other carbonates such as calcite and ankerite, g arnet, mica, quartz, and other
silicates such as diopside, orthoclase, serpentine and amphibole.
Table 9-3: Mineral composition of  Thengkham East Primary Samples
Mineral Sample ID
R036781 R036782 R036783 R036784 R036785 R036786 R036787
Chalcopyrite 6.19 1.86 1.09 8.13 1.59 1.87 0.72
Bornite 0 0 0 0 0 0.01 0.01
Tennantite 0.14 0 0.03 0 0 0 0
Pyrite 4.85 0.94 2.96 9.93 0.28 0.18 4.81
Molybdenite 0 0 0.07 0.03 0.01 0.01 0
Iron Oxide 0 0.01 0.01 0.01 0.54 0.99 10.42
Ankerite 0.58 15.26 0.06 47.61 0.18 0.56 0.11
Calcite 2.72 5.8 1.61 0.29 11.1 18.04 11.42
Dolomite 40.98 53.41 5.65 4.58 0.11 0.17 0.18
Fluorite 0.08 0.2 0.02 0.46 0.01 0.01 0.57
Apatite 0.01 0.02 0.13  0.05 0.11 0.11 0.01
Amphibole 0.41 0.11 0.03 0 0 0.21 10.06
Andradite_Grossular 0.56 1.6 8 0.65 1.61 64.85 55 0.37
Chlorite 0.07 0.98 0 0.02 0.28 0.03 0
Chlorite_2 0 0 0 16.84 1.35 1.77 0.13
Chlorite_3 0 0 0.01 0 2.79 0.61 0.38
Chlorite_4 0 0 0 1.19 0.45 0.52 0
Diopside 4.54 2.79 0.43 0.3 0.34 0.92 26.76
Illite 0.07 0.06 1.63 0.86 8.41 4.9 0.01
Muscovite 0.63 0.17 26.01 4.56 0.12 0.1 0
Orthoclase 0.01 0 10.01 0.01 0.25 0.1 0
Phlogopite 0 0 0 0 0.02 0.02 2.23
Quartz 38.12 16.66 49.08  3.38 6.73 13.57 0.24
Serpentine 0.02 0.01 0.05 0 0 0.07 31.55
Titanite 0.01 0.01 0.04 0.01 0.34 0.16 0
Others 0.01 0.03 0.43 0.13 0.14 0.07 0.02
Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0
Source: LXML -  Sepon Thengkham Primary Copper Proof of Concept
9.2.3 Flotation Test
Flotation tests were conducted on 29 composites samples, which covered different rock types and
lithologies, and a broad range of copper, sulphur, calcium and magnesium grade.
The tests adopted conventional flowsheet comprising rougher flotation at grind size of P80=106μm，
regrinding the rougher concentrate to target fineness of P80=25μm then cleaner flotation. The tests
results are summarised in Table 9-4.
– IIIB-88 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Low grade samples with average grade of 0.61% Cu yielded a copp er recovery of 84.5%, with a
concentrate grade of 18.5% Cu.
Middle grade samples with average grade of 1.12% Cu yielded a c opper recovery of 83.2%, with a
concentrate grade of 19.4% Cu.
High grade samples with average grade of 1.42% Cu, yielding a c opper recovery of 57.0%, with a
concentrate grade of 7.5%. All the high grade samples showed a high sulphur content and high Acid
Soluble Copper (ASCu) fraction, which resulted in the low conce ntrate grade and low copper
recovery.
Table 9-4: Primary Copper Flotation Results
Sample ID Lithology
Head Grade (%)
  Regrind
(μm)
Mass pull
(%)
Conc. Grade (%) Cu
Recovery
(%) Cu S Cu S
Comp 8 Massive sulphide 0.28 1.2 24.4 1.0 24.5 27.9 88.8
Comp 6 Altered dolomite 0.39 11.8 24.9 2.3 13.0 22.1 77.1
Comp 2 Skarn 0.47 4.8 25.1 2.4 16.0 21.4 82.4
Comp 4 Magnesium
Skarn 0.48 4.1 21.2 2.7 15.0 18.8 82.9
Comp 10 Altered Hornfels 0.53 2.9 24.4 1.9 24.9 28.9 89.3
Comp 5 Altered dolomite 0.60 8.7 25.2 3.1 16.6 34.5 85.3
Master TK3 HNF + SLT 0.73 5.5 30.0 5.0 12.1 39.8 87.9
Comp R2_5 Altered dolomite 0.84 8.0 23.0 3.6 19.0 37.1 80.5
Master TK6 HSK/DOL/HNF 0.86 4.8 25.0 2.7 26.4 33.5 83.6
Master TK1 DOL 0.87 2.8 22.4 3.5 19.9 23.7 86.8
Average 0.61 5.5 24.6 2.8 18.7 28.8 84.5
Master TK4 MAG/SCS-DOL 0.90 8.1 22.0 4.8 12.7 33.6 73.7
Comp R2_ll RDP 0.92 5.5 25.4 3.2 26.6 31.0 92.4
Master TK5 RDP 0.96 2.6 26.0 5.3 15.3 19.1 85.9
Comp R2_3 Magnesium
Skarn 0.99 7.6 24.3 3.8 21.1 27.5 80.2
Master TK9 SRD/HSK/DOL 1.00 7.6 30.0 5.7 13.4 39.4 80.8
Master
TK10 DOL/SRD/SLT 1.00 8.9 31.0 5.4 16.8 37.6 89.0
Comp R2_l Skarn 1.05 7.4 25.7 3.6 26.9 31.1 91.2
Comp 3 Magnesium
Skarn 1.07 5.0 20.7 5.9 15.1 19.0 83.4
Master TK7 MSS/HNF 1.09 4.7 32.0 5.4 19.0 35.6 91.3
Comp 9 Altered Hornfels 1.23 2.3 25.0 3.7 28.3 30.3 84.4
Comp 7 Massive sulphide 1.29 4.4 24.3 3.7 23.7 31.4 68.3
Comp 1 Skarn 1.33 5.2 25.9 5.2 21.1 25.0 82.5
Comp R2_9 Altered Hornfels 1.33 6.5 25.6 4.9 19.8 38.1 72.7
Master
TK12 MSS-DOL 1.47 5.7 33.0 10.4 12.4 40.3 89.6
Average 1.12 5.8 26.5 5.1 19.4 31.4 83.2
Master TK8 DOL/RDP 0.96 12.1 34.0 15.0 3.4 47.7 53.2
Master
TK11 MSS-SLT/DOL 1.29 13.2 42.0 19.3 3.1 49.1 47.3
Comp R2_7 Massive sulphide 1.13 14.0 25.7 4.4 21.3 37.6 81.6
Master TK2 RDP 1.11 18.0 39.0 22.0 3.2 48.7 69.2
Master
TK13 MSS - DOL/RDP 2.63 43.0 29.0 13.2 6.7 47.9 33.6
Average 1.42 20.1 33.9 14.8 7.5 46.2 57.0
– IIIB-89 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Source: LXML -  Sepon Thengkham Primary Copper Proof of Concept
A master composite was produced from other composites previously used for bench flotation testing.
The flotation test results are shown in Table 9-5. The test achieved a copper recovery of 89.1%, with
a concentrate grade of 22.3%.
Table 9-5: Master Composite Flotation Test Results
Product Mass Pull
(%)
Grade (%) Recovery (%)
Cu S Fe Cu S Fe
Cleaner Conc. 4.25 22.3 28.8 26.1 89.1 17.2 10.3
Cleaner Tail 4.32 0.56 12.1 14.7 2.27 7.32 5.89
Rougher Tail 91.4 0.10 5.9 9.87 8.59 75.5 83.8
Calc'd Head 100.0 1.06 7.14 10.8 100.0 100.0 100.0
Assay Head   1.11 6.79 10.2
Source: LXML -  Sepon Thengkham Primary Copper Proof of Concept
9.2.4 Conclusion and Recommendation
Conventional flotation process can be applied to the primary co pper ores to produce a saleable
copper concentrate. The concentrate grade and copper recovery are affected by the sulphur grade
and ASCu/TCu ratio.  A general copper recovery of 80% can be achieved.
The gold and silver are likely recovered into copper concentrate but there are no relevant data. The
precious metals credit to the concentrate cannot be evaluated. More flotation tests are recommended
to assess the gold and silver recovery and concentrate quality.

– IIIB-90 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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10 Mineral Resource Estimates
The JORC Code 2012 defines a mineral resource as:
“a concentration or occurrence of material of solid material of economic interest in or on the Earth’s
crust in such form, grade (or quality) and quantity that there are reasonable prospects for eventual
economic extraction. The locat ion, quantity, grade (or quality) , continuity and other geological
characteristics of a Mineral Resource are known, estimated or i nterpreted from specific geological
evidence and knowledge, including sampling. Mineral Resources a re sub-divided, in order of
increasing geological confidence, into Inferred, Indicated and Measured categories.”
“All reports of Mineral Resources must satisfy the requirements that there are reasonable prospects
for eventual economic extraction (ie more likely than not), reg ardless of the classification of the
resource.
Portions of a deposit that do not have reasonable prospects for  eventual economic extraction must
not be included in a Mineral Resource…”
10.1 Introduction
LXML is an operating mine at the Effective Date.  It hosts seve ral deposits along a 14 km long belt
of carbonaceous rocks.  Figure 10-1 is showing the plan view of current LXML deposits.
The open pits are or will be constructed at the area of deposits of DSE OP, DSW OP, NLU OP, SKM
OP, NKW OP, TKM OP, KHN OP and Far West Areas (Nakachan (NAK OP ), Ban Non (NON OP),
and Ban Mai (MAI OP)). The underground mines are located at deposits Discovery Deep East (DSE
UG) and Discovery Deep West (DSW UG).
In addition to these deposits, there are dozens of stockpiles of gold and copper ore on site.
The latest block models and data were constructed or updated by  LXML personnel as at 30
September 2024.
At the Effective Date, SRK estimated Mineral Resource from these deposits and stockpiles.
Figure 10-1: Plan view of LXML Mineral Resource Deposits

Sources: LXML
– IIIB-91 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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10.2 Year (Quarter)-end Map and Mined-out Areas
SRK was provided with a year (Quarter)--end map dated on 30 Sep tember 2024. The map covers
those deposits that are working or in plan.  After reviewing of  the year-end map, SRK considered it
was of sufficient details to support Mineral Resource estimate.
Figure 10-2: Year(Quarter)-end Ma p, Dated on 30 September 2024
Sources: SRK
10.3 Mineral Resource Models
SRK were provided with the latest block models, thirteen in total, which were constructed or updated
by LXML personnel between in February to March 2024 and September 2023 (nlu_gc.bmf) and notes
(“MR 2024Q1 Classification Notes.xlsx”), where Mineral Resource categories are classified in twelve
block models. Among them, six bl ock models have been updated ba sed on sustaining exploration
campaigns. They are: DSE OP (“dse_gc_29032024.bmf”), DSW OP (“d sw_gc_03022024.bmf”),
NMK OP (“nkk_gc300324.bmf”), NLU OP (“nlu_gc160324.bmf together with nlu_gc.bmf”), SKM OP
(“Songkham_v3.bmf”), and DSC UG (“DSC_UG_FEB24.bmf”).
For the Phavat deposit (“PVT”), the Mineral Resources cannot be  reported by SRK since the block
model “bm_pvt_oct 2023.bmf ” has not been classified as Mineral Resource.
– IIIB-92 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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10.4 Open Pit Mining
10.4.1 Discovery East (DSE OP)
The key parameters for DSE Mineral Resource estimation are summarized in Table 10-1.
Table 10-1: Key Parameters of Mineral Resources Estimate (DSE O P)
Item Description
Software Vulcan
Drill hole database -
Cut-off grade The Au cut-off grade depends on the gold ore types. For oxidize d gold ore, the
cut-off grade is 0.6 g/t, and for primary gold ore is 1.5 g/t
Block size The Parent block model is 150 x 96 x 75m, and the sub cell is 1 x1 x 2.5 m
Grade capping -
Grade interpolation -
Search parameter -
Mineral Resource
classification
Indicated: Approximate drill-hole spacing 20 to 40m through the  area.  Some
parts with closer spacing. Inferred: Approximate drill-hole spacing up to 40m.
All of DSE02A pit assigned Indica ted. All of Oxide in DES04B is  classified as
Indicated, all of Primary in DSE04B is classified as Inferred.
The DSE04B pit is targeting the northern edge of mineralisation  and several
sections do not have drilling c losing out the mineralisation.  Therefore, this
mineralisation has been classified as Inferred in this pit shel l .   A l l  o t h e r
mineralisation has been classified as Indicated.
Sources: LXML
The DSE Statement of Mineral Resource is shown in Table 10-2.
Table 10-2: Mineral Resource Stat ement of DSE OP Deposit, as of 30 September 2024
Type Category Tonnage Au Au Metal Contained Au Metal Contained
(kt) (g/t) (t) (koz)
Oxide
Measured - - - -
Indicated 472 1.61 0.76 24
MES+IND 472 1.61 0.76 24
Inferred - - - -
Primary
Measured - - - -
Indicated - - - -
MES+IND - - - -
Inferred 143 3.23 0.46 15
Total
Measured - - - -
Indicated 472 1.61 0.76 24
MES+IND 472 1.61 0.76 24
Inferred 143 3.23 0.46 15
Sources: SRK
10.4.2 Discovery West (DSW OP)
The key parameters for DSW Mineral Resource estimation are summarized in Table 10-3.
– IIIB-93 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Table 10-3: Key Parameters of Mi neral Resources Estimate (DSW OP)
Item Description
Software -
Drill hole database -
Cut-off grade The Au cut-off grade depends on the gold ore types. For oxidize d gold ore, the cut-off
grade is 0.6 g/t, and for primary gold ore is 1.5 g/t
Density -
Block size The Parent block model is 150 x 96 x 75m, and the sub cell is 1 x1 x 2.5m
Grade capping -
Grade
interpolation
-
Search parameter -
Mineral Resource
classification
Indicated: Approximately 20m spac ing with some closer spaced dr illing in places from
previous GC campaigns. All of pits classified as Indicated Infe rred: Approximate drill-
hole spacing up to 40m
 Sources: LXML
The DSW Statement of Mineral Resource is shown in Table 10-4.
Table 10-4: Mineral Resource Stat ement of DSW OP Deposit, as of 30 September 2024
Type Category Tonnage Au
Grade
Au Metal
Contained
Au Metal
Contained
(kt) (g/t) (t) (koz)
Oxide
Measured - - - -
Indicated 12 1.02 0.01 0.4
MES+IND 12 1.02 0.01 0.4
Inferred - - - -
Primary
Measured - - - -
Indicated 18 7.39 0.13 4
MES+IND 18 7.39 0.13 4
Inferred - - - -
Total
Measured - - - -
Indicated 29 4.86 0.14 5
MES+IND 29 4.86 0.14 5
Inferred - - - -
Sources: SRK
10.4.3 Namkok West (NKW OP)
The key parameters for NKW Mineral Resource estimation are summarized in Table 10-5.
Table 10-5: Key Parameters of Mi neral Resources Estimate (NKW OP)
Item Description
Software Leapfrog and Vulcan
Drill hole database The database contains informati on for 17,421 boreholes and 530, 024 samples with
Cu, Au and silver (Ag) assays
– IIIB-94 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Item Description
Cut-off grade The Au cut-off grade depends on the gold ore types. For oxidize d gold ore, the cut-
off grade is 0.6 g/t, and for primary gold ore is 1.5 g/t.
Density 14,209 SG samples
Block size The Parent block model is 60 x 30 x 10m, and the sub cell is 1 x 1 x 2.5m
Grade capping Au Primary LG Pass 1:Au Lower:0.005 g/t      Au Upper :15g/t
Au Primary HG Pass 1:Au Lower:0.005 g/t      Au Upper :30g/t
Au Oxide LG Pass 1:Au Lower:0.001 g/t      Au Upper :15g/t
Au Oxide HG Pass 1:Au Lower:0.001 g/t      Au Upper :20g/t
Grade interpolation Ordinary Kriging
Search parameter Domain Au Primary HG
1 pass: Dynamic anisotropy ；Maj (dist.):50 Inter (dist.):25 Minor (dist.):20; Min No
Samples:12  Max No Samples:15
2 pass: Dynamic anisotropy ；Maj (dist.):80 Inter (dist.):40 Minor (dist.):30; Min No
Samples:9  Max No Samples:16
3 pass: Dynamic anisotropy ；Maj (dist.):120 Inter (dist.):80 Minor (dist.):60; Min No
Samples:6  Max No Samples:18
4 pass: Dynamic anisotropy；Maj (dist.):1,000 Inter (dist.):800 Minor (dist.):600; Min
No Samples:4  Max No Samples:12
Mineral Resource
classification
Measured (approx. 10m spacing), Indicated (20 to 25m spacing), Inferred (>50m, up
to 70m)
Measured (approx. 10m spacing), Indicated (20 to 25m spacing), Inferred (>50m, up
to 70m)
All of pit NMK01B classified as Indicated. All of NMK02A classified as Measured.  All
of NMK02B is Inferred. All of NMK3A is Indicated.
 Sources: LXML
The NKW Statement of Mineral Resource is shown in Table 10-6.
Table 10-6: Mineral Resource Stat ement of NKW OP Deposit, as of 30 September 2024
Type Category Tonnage Au Grade Au Metal Contained Au Metal Contained
(kt) (g/t) (t) (koz)
Oxide
Measured 29 1.05 0.03 1
Indicated 1,064 1.28 1.36 44
MES+IND 1,093 1.27 1.39 45
Inferred 176 0.90 0.16 5
Primary
Measured 1 2.78 0.003 0.1
Indicated 259 3.43 0.89 29
MES+IND 260 3.42 0.89 29
Inferred - - - -
Total
Measured 30 1.11 0.03 1
Indicated 1,323 1.70 2.25 72
MES+IND 1,353 1.68 2.28 73
Inferred 176 0.90 0.16 5
Sources: SRK
10.4.4 Nalou (NLU OP)
The key parameters for NLU Mineral Resource estimation are summarized in Table 10-7.
– IIIB-95 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Table 10-7: Key Parameters of Mineral Resources Estimate (NLU O P)
Item Description
Software Leapfrog and Vulcan
Drill hole database The database contains information for 17,421 boreholes and 530,024 samples with Cu,
Au and silver (Ag)  assays.

Cut-off grade The Au cut-off grade depends on the gold ore types. For oxidized gold ore, the cut-off
grade is 0.6 g/t, and for primary gold ore is 1.5 g/t.
Density 14,209 SG samples
Block size The Parent block model is 60 x 30 x 10m, and the sub cell is 1 x 1 x 2.5m
Grade capping Au Primary LG Pass 1:Au Lower:0.005 g/t      Au Upper :15g/t
Au Primary HG Pass 1:Au Lower:0.005 g/t      Au Upper :30g/t
Au Oxide LG Pass 1:Au Lower:0.001 g/t      Au Upper :15g/t
Au Oxide HG Pass 1:Au Lower:0.001 g/t      Au Upper :20g/t
Grade interpolation Ordinary Kriging
Search parameter Domain Au Primary HG
1 pass: Dynamic anisotropy ；Maj (dist.):50 Inter (dist.):25 Minor (dist.):20; Min No
Samples:12  Max No Samples:15
2 pass: Dynamic anisotropy ；Maj (dist.):80 Inter (dist.):40 Minor (dist.):30; Min No
Samples:9  Max No Samples:16
3 pass: Dynamic anisotropy ；Maj (dist.):120 Inter (dist.):80 Minor (dist.):60; Min No
Samples:6  Max No Samples:18
4 pass: Dynamic anisotropy ；Maj (dist.):1,000 Inter (dist.):800 Minor (dist.):600; Min
No Samples:4  Max No Samples:12
Mineral Resource
classification
Measured (5 to 10m spacing), Indicated (20 to 25m spacing, some areas broader with
less than 50m), Inferred (>50m)
Classification applied by each pit shell/stage.  2B includes Measured where GC drilling
has been undertaken (approximately 5 by 10m spacing).  All other mineralisation in this
pit is considered Indicated with a drill-spacing of between 20 to 25 metres.  2C has
been classified in the same way as for 2B.  3C is entirely classified as Indicated as no
GC has been completed for this pit shell and drill spacing is a pproximately 25 metre
(less then 50m).  3D is entirely Inferred due to the drilling b eing broad-spaced in this
volume.
Sources: LXML
The NLU Statement of Mineral Resource is shown in Table 10-8.
Table 10-8: Mineral Resource Stat ement of NLU OP Deposit, as of 30 September 2024
Type Category Tonnage Au Grade Au Metal
Contained
Au Metal
Contained
(kt) (g/t) (t) (koz)
Oxide
Measured - - - -
Indicated 72 1.25 0.09 3
MES+IND 72 1.25 0.09 3
Inferred 24 1.20 0.03 1
Primary
Measured 1 2.41 0.00 0
Indicated 299 3.80 1.14 37
MES+IND 301 3.79 1.14 37
Inferred - - - -
Total Measured 1 2.41 0.003 0.1
Indicated 372 3.30 1.23 39
– IIIB-96 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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MES+IND 373 3.30 1.23 40
Inferred 24 1.20 0.03 1
Sources: SRK
10.4.5 Ban Mai (MAI OP)
The key parameters for MAI Mineral Resource estimation are summarized in Table 10-9.
Table 10-9: Key Parameters of Mineral Resources Estimate (MAI O P)
Item Description
Software Leapfrog
Drill hole database The database contains informati on for 1,309 boreholes and 97,22 5 samples with
Cu, Au and silver (Ag)  assays
Cut-off grade The Au cut-off grade depends on the gold ore types. For oxidized gold ore, the cut-
off grade is 0.6 g/t, and for primary gold ore is 1.5 g/t.
Density 4,494 SG samples
Block size The Parent block model is 25 x 12.5 x 25m, and the sub cell is 6.25 x 3.125 x 6.25m
Grade capping Domain Au_H_01:Au Lower:0.01 g/t      Au Upper :15g/t
Domain Au_H_02: Au Lower:0.005 g/t      Au Upper :5g/t
Domain Au_V_01: Au Lower:0.005 g/t      Au Upper :25g/t
Domain Au_V_08: Au Lower:0.07 g/t      Au Upper :10g/t
Domain Au_V_09: Au Lower:0.02 g/t      Au Upper :15g/t
Domain Au_V_10: Au Lower:0.09 g/t      Au Upper :10g/t
Domain Au_V_11: Au Lower:0.005 g/t      Au Upper :10g/t
Domain Au_V_12: Au Lower:0.03 g/t      Au Upper :4g/t
Domain Au_V_14: Au Lower:0.005 g/t      Au Upper :2g/t
Domain Au_V_16: Au Lower:0.005 g/t      Au Upper :12g/t
Domain Au_V_17: Au Lower:0.005 g/t      Au Upper :5g/t
Grade interpolation Ordinary Kriging
Search parameter Dynamic anisotropy ； Maj (dist.):50 Inter (dist.):50 Minor (dist.):10; Min No
Samples:5 Max No Samples:20
Mineral Resource
classification
Inferred: ranges from 50 to 100m.
Entirely classified as Inferred based on deposit only recently delivered from
Exploration drilling for assessment as Mineral Resource.  Drill ing is broad spaced
(50 to 100m spacing). Several mineralised intersections on the main mineralised
sections provide support for estimating/reporting a mineral resource but inconsistent
and variable results do not support higher than Inferred Minera l Resource until
further definition drilling is completed.
Sources: LXML
The MAI Statement of Mineral Resource is shown in Table 10-10.
Table 10-10: Mineral Resource Statement of MAI OP Deposit at Fa r West Mine, as of 30
September 2024
Type Category Tonnage Au Grade Au Metal
Contained
Au Metal
Contained
(kt) (g/t) (t) (koz)
Oxide
Measured - - - -
Indicated - - - -
MES+IND - - - -
Inferred 734 2.03 1.49 48
Primary Measured - - - -
– IIIB-97 –
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FOR THE SEPON GOLD AND COPPER MINE


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Indicated - - - -
MES+IND - - - -
Inferred 354 3.43 1.21 39
Total
Measured - - - -
Indicated - - - -
MES+IND - - - -
Inferred 1,088 2.48 2.70 87
Sources: SRK
10.4.6 Ban Non (NON)
Table 10-11: Key parameters of Mineral Resources estimate (NON)
Item Description
Software Leapfrog
Drill hole database The database holds information for about 269 boreholes and 26,562 samples each
of which include Cu Au and Ag grade  and other element-related data.
Cut-off grade The Au cut-off grade depends on the gold ore types. For  oxidized gold ore, the cut-
off grade is 0.6 g/t, and for primary gold ore is 1.5 g/t.
Density 1079 SG samples
Block size The Parent block model is 25 x 12.5 x 25, and the subcell is 6.25 x 3.125 x 3.125
Grade capping
Domain Au_OX_01:Au Lower:0.005 g/t      Au Upper :10g/t
Domain Au_OX_02:Au Lower:0.005 g/t      Au Upper :10g/t
Domain Au_H_01:Au Lower:0.01 g/t      Au Upper :10g/t
Domain Au_W_03:Au Lower:0.005 g/t      Au Upper :10g/t
Grade interpolation Ordinary Kriging
Search parameter Dynamic anisotropy；Maj (dist):30 Inter (dist):25 Minor (dist):5; Min No Samples:1
Max No Samples:20
Mineral Resource
classification
Inferred: ranges from 50 to 100m. Entirely classified as Inferred based on deposit
only recently delivered from Exploration drilling for assessment as Mineral
Resource.  Drilling is broad-spaced (50 to 100m spacing). Several mineralised
intersections on the main mineralised sections provide support for
estimating/reporting a mineral resource but inconsistent and variable results do not
support higher than Inferred Mineral Resource until further definition drilling is
completed.
Sources: LXML
Table 10-12: Mineral Resource Memorandum of Ban Non Open Pit De posit at Far West Mine,
as of 30 September 2024
Type Category Tonnage Au Grade Au Metal Contained Au Metal Contained
(kt) (g/t) (t) (koz)
Oxide
Measured - - - -
Indicated - - - -
MES+IND - - - -
Inferred 651 1.90 1.24 40
Primary
Measured - - - -
Indicated - - - -
MES+IND - - - -
Inferred 55 3.67 0.20 7
Total
Measured - - - -
Indicated - - - -
MES+IND - - - -
– IIIB-98 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Inferred 706 2.04 1.44 46
Sources: SRK
10.4.7 Nakachan (NAK OP)
The key parameters for NAK Mineral Resource estimation parameters summarized in Table 10-13.
Table 10-13: Key Parameters of Mineral Resources Estimate (NAK OP)
Item Description
Software Leapfrog
Drill hole database The database contains information for 208 boreholes and 23,082 samples with Cu,
Au and silver (Ag) assays
Cut-off grade The Au cut-off grade depends on the gold ore types. For oxidized gold ore, the cut-
off grade is 0.6 g/t, and for primary gold ore is 1.5 g/t.
Density 940 SG samples
Block size The Parent block model is 20 x 15 x 5m, and the sub cell is 5 x 3x 2.5m
Grade capping
Domain Au in Oxide: Au Lower:0.03 g/t      Au Upper :6g/t
Domain Au in Primary: Au Lower:0.03 g/t   Au Upper :6g/t
Domain Au Waste: Au Lower:0.005 g/t       Au Upper :0.6g/t
Grade interpolation Ordinary Kriging
Search parameter
Au in Oxide
DIP 193.3 Dip Azi 120 PITCH 40；Maj (dist.):30 Inter (dist.):25 Minor (dist.):5; Min
No Samples:4 Max No Samples:20
Au in Primary
DIP 25.2 Dip Azi 191.6 PITCH 11.6；Maj (dist.):308.3 Inter (dist.):95.8 Minor
(dist.):50.9; Min No Samples:4 Max No Samples:20
Au Waste
DIP 25.9 Dip Azi 191.6 PITCH 175.2；Maj (dist.):250 Inter (dist.):207 Minor
(dist.):177; Min No Samples:4 Max No Samples:20
Mineral Resource
classification
Inferred: ranges from 50 to 100m.
Entirely classified as Inferred based on deposit only recently delivered from
Exploration drilling for assessment as Mineral Resource.  Drilling is broad-spaced (50
to 100m spacing). Several mineralised intersections on the main mineralised sections
provide support for estimating/reporting a mineral resource but  inconsistent and
variable results do not support higher than Inferred Mineral Re source until further
definition drilling is completed.
Sources: LXML
The NAK Statement of Mineral Resource is shown in Table 10-14.
Table 10-14: Mineral Resource Statement of NAK OP Deposit at Far West Mine, as of 30
September 2024
Type Category Tonnage Au Grade Au Metal Contained Au Metal Contained
(kt) (g/t) (t) (koz)
Oxide
Measured - - - -
Indicated - - - -
MES+IND - - - -
Inferred 1,251 1.07 1.33 43
Primary
Measured - - - -
Indicated - - - -
MES+IND - - - -
Inferred 212 2.76 0.58 19
– IIIB-99 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Total
Measured - - - -
Indicated - - - -
MES+IND - - - -
Inferred 1,463 1.31 1.92 62
Sources: SRK
10.4.8 Thenkham (TKM OP)
The TKM OP Mineral Resource is shown in Table 10-15.
Table 10-15: Mineral Resource Statement of TKM OP Deposit, as o f 30 September 2024
Type Category Tonnage Cu Grade Cu Metal Contained
(kt) (%) (kt)
Oxide
Measured - - -
Indicated - - -
MES+IND - - -
Inferred 855 1.89 16.16
Primary
Measured - - -
Indicated - - -
MES+IND - - -
Inferred 32 1.82 0.59
Total
Measured - - -
Indicated - - -
MES+IND - - -
Inferred 888 1.89 1.68
Sources: SRK
10.5 Underground Mining
10.5.1 Discovery Deep East (DSE UG)
The key parameters for DSE UG Mineral Resource estimation are summarized in Table 10-16.
Table 10-16: Key Parameters of Mineral Resources Estimate (DSE UG)
Item Description
Software Vulcan
Drillhole database The database contains information for 22,096 boreholes and 69,4 74 samples with Cu,
Au and silver (Ag) assays
Cut-off grade The Au cut-off grade depends on the gold ore types. For oxidize d gold ore, the cut-off
grade is 3 g/t, and for primary gold ore is Domain.
Density 21,642 SG samples
Block size The Parent block model is 5 x 3 x 2.5m, and the sub cell is 1 x 1 x 1.25m
Grade capping Au Lower:0.005 g/t      Au Upper :10 g/t
Grade
interpolation
Ordinary Kriging
Search parameter Domain AuHGPr_Vn1
Dynamic anisotropy; Min No Samples:12 Max No Samples:20
– IIIB-100 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Item Description
Domain AuHGPr_Vn2
Dynamic anisotropy; Min No Samples:8 Max No Samples:20
Domain AuHGPr_Vn3
Dynamic anisotropy; Min No Samples:4 Max No Samples:20
Mineral Resource
classification
Measured (approximately 15m spaced drilling), Indicated (mostly  25m, up to 50m
spaced), Inferred (50 to 100m spaced)
 Sources: LXML
The DSE UG Statement of Mineral Resource is shown in Table 10-17 .
Table 10-17: Mineral Resource Statement of DSE UG Deposit, as o f 30 September 2024
Type Category
Tonnage Au Grade Au Metal
Contained
Au Metal
Contained
(kt) (g/t) (t) (koz)
Oxide
Measured - - - -
Indicated - - - -
MES+IND - - - -
Inferred - - - -
Primary
Measured 245 8.85 2.17 70
Indicated 2,839 6.94 19.71 634
MES+IND 3,084 7.10 21.88 704
Inferred 1,237 7.02 8.68 279
Total
Measured 245 8.85 2.17 70
Indicated 2,839 6.94 19.71 634
MES+IND 3,084 7.10 21.88 704
Inferred 1,237 7.02 8.68 279
Sources: SRK
10.5.2 Discovery D eep West (DSW UG)
The key parameters for DSW UG Mineral Resource estimation are summarized in Table 10-18.
Table 10-18: Key Parameters of Mineral Resources Estimate (DSW UG)
Item Description
Software Vulcan
Drill hole database The database contains information for 21,580 boreholes and 698, 180 samples with
Cu, Au and silver (Ag) assays

Cut-off grade The Au cut-off grade depends on the gold ore types. For oxidized gold ore, the cut-off
grade is 3 g/t, and for primary gold ore is Domain.
Density 21,642 SG samples
Block size The Parent block model is 20 x 10 x 10m, and the sub cell is 2 x 2 x 2m
Grade capping Au Lower:0.005 g/t      Au Upper :10 g/t
Grade interpolation Ordinary Kriging
– IIIB-101 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Item Description
Search parameter Domain Au Primary HG
1 pass: Dynamic anisotropy; Maj (dist.) :50 Inter (dist.):25 Mi nor (dist.):20; Min No
Samples:12  Max No Samples:15
2 pass: Dynamic anisotropy; Maj (dist.):80 Inter (dist.):40 Min or (dist.):30; Min No
Samples:9  Max No Samples:16
3 pass: Dynamic anisotropy; Maj (dist.):120 Inter (dist.):80 Mi nor (dist.):60; Min No
Samples:6  Max No Samples:18
4 pass: Dynamic anisotropy; Maj (dist.):1,000 Inter (dist.):800 Minor (dist.):600; Min No
Samples:4  Max No Samples:12
Mineral Resource
classification
Inferred (Variable 30 to 110m spacing), All UG Mineral Resource classified as Inferred
Sources: LXML
The DSW UG Statement of Mineral Resource is shown in Table 10-19.
Table 10-19: Mineral Resource Statement of DSW UG Deposit, as o f 30 September 2024
Type Category
Tonnage Au Grade Au Metal
Contained
Au Metal
Contained
(kt) (g/t) (t) (koz)
Oxide
Measured - - - -
Indicated - - - -
MES+IND - - - -
Inferred - - - -
Primary
Measured - - - -
Indicated - - - -
MES+IND - - - -
Inferred 1,165 5.68 6.62 213
Total
Measured - - - -
Indicated - - - -
MES+IND - - - -
Inferred 1,165 5.68 6.62 213
Sources: SRK
10.5.3 Khanong (KHN UG)
The KHN UG Mineral Resource is shown in Table 10-20.
Table 10-20: Mineral Resource Statement of KHN UG Deposit, as of 30 September 2024
Type Category
Tonnage Cu Grade Cu Metal Contained
(kt) (%) (kt)
Oxide
Measured - - 0
Indicated - - -
MES+IND - - -
Inferred - - -
Primary Measured - - -
– IIIB-102 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Indicated 2,445 1.90 46.52
MES+IND 2,445 1.90 46.52
Inferred 595 1.58 9.39
Total
Measured - - -
Indicated 2,445 1.90 46.52
MES+IND 2,445 1.90 46.52
Inferred 595 1.58 9.39
Sources: SRK
10.6 Stockpile
10.6.1 Gold Stockpile
SRK was provided with summary det ails of the LXML gold stockpiles (“WK13_All Stockpile Status
survey 27 Mar 2024 EODS_Au_Ca_M g_update.xls”) as of 30 Septembe r 2024.  There are 41
stockpiles on site, of which 15 are oxide gold stockpiles, and 26 are primary gold stockpiles that are
available for extraction of gold. The materials in these availa ble stockpiles were converted to
Indicated Mineral Resource.
The gold stockpile Statement of Mineral Resource is shown in Table 10-21.
Table 10-21: Mineral Resource Statement of Gold Stockpile, as o f 30 September 2024
Type Category
Tonnage Au Grade Au Metal Contained Au Metal Contained
(kt) (g/t) (t) (koz)
Oxide
Measured - - - -
Indicated 361 1.91 0.69 22
MES+IND 361 1.91 0.69 22
Inferred - - - -
Primary
Measured - - - -
Indicated 1,823 2.75 5.02 161
MES+IND 1,823 2.75 5.02 161
Inferred - - - -
Total
Measured - - - -
Indicated 2,185 2.61 5.71 183
MES+IND 2,185 2.61 5.71 183
Inferred - - - -
Sources: SRK
10.6.2 Copper Stockpile
SRK was provided with summary details of the LXML copper stockpiles (“wk13_All Stockpile Status
survey 27-Mar 2024 EODS _Cu_Update.xls”) as of 27 March 2024.  There are 20 stockpiles on site,
of which 15 are oxide copper stockpiles, and 5 are primary copp er stockpiles that are available for
– IIIB-103 –
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extraction of copper.  The materials in these available stockpiles were converted to Indicated Mineral
Resource.  The copper stockpile Statement of Mineral Resource is shown in Table 10-24.
Table 10-22: Mineral Resource Statement of Copper Stockpile, as  of 30 September 2024
Type Category Tonnage Cu Grade Cu Metal Contained
(kt) (%) (kt)
Oxide
Measured - - 0
Indicated 1,367 0.93 12.74
MES+IND 1,367 0.93 12.74
Inferred - - -
Primary
Measured - - -
Indicated 603 0.82 4.95
MES+IND 603 0.82 4.95
Inferred 595 1.58 9.39
Total
Measured - - -
Indicated 1,970 0.90 17.69
MES+IND 1,970 0.90 17.69
Inferred 595 1.58 9.39
Sources: SRK
10.7 Conclusions and Recommendations
The data provided from LXML is sufficient to estimate the Mineral Resource.
The total LXML gold Mineral Resource is shown in Table 10-23.
Table 10-23: Mineral Resource Estimate of Total Gold, as of 30 September 20241
Type Category
Tonnage Au Grade Au Metal
Contained
Au Metal
Contained
(kt)2 g/t t koz
Oxide
Measured 29 1.05 0.03 1
Indicated 1,981 1.47 2.91  94
MES+IND3 2,010 1.46 2.94  95
Inferred 2,836 1.50 4.25 137
Primary
Measured 247 8.80 2.17 70
Indicated 5,239 5.13  26.89 864
MES+IND3 5,486 5.30 29.06  934
Inferred 3,166 5.61 17.76 571
Total
Measured 276 7.98 2.21 71
Indicated 7,220  4.13 29.80  958
MES+IND3 7,496 4.27 32.00 1,029
Inferred 6,002 3.67 22.00 707
Sources: SRK
Notes:
1 The information relates to Mineral Resource estimation is based  on information compiled by Mr. Liang Li, MAusIMM, and
Dr. Anshun Xu, FAusIMM, employees  of SRK Consulting China Ltd. Both Dr. Xu and Mr. Li have sufficient experience
relevant to the style of mineralisation and type of deposit under consideration and to the activity which they are undertaking
– IIIB-104 –
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to qualify as Competent Persons as defined in JORC (2012).  Dr.  Xu supervised the work of Mr. Li. Both Dr. Xu and Mr. Li
consent to the reporting of this information in the form and context in which it appears.
2 Total may not add due to rounding discrepancies.
3 MES+IND: combined measured and Indicated, Mineral Resource.
4 The cut-off grade depends on ore type (Otyp) and mining method. For open pit mining and gold stockpiles, the cut-off grade
of oxide ores is 0.6 g/t, the cut-off grade of primary ores is 1.5 g/t. For Underground mining, the cut-off grade of oxide ore s
is 3g/t, the cut-off grade of primary ores is domain.
The total LXML copper Mineral Resource is shown in Table 10-24.
Table 10-24: Mineral Resource Estimate of Total Copper, as of 3 0 September 2024 1
Type Category
Tonnage Cu Grade Cu Metal Contained
(kt)2 (%) (kt) 2
Oxide
Measured - - -
Indicated 1,367 0.93  12.74
MES+IND3 1,367 0.93   12.74
Inferred 855 1.89 16.16
Primary
Measured - - -
Indicated 3,049 1.69 51.47
MES+IND3 3,049 1.69 51.47
Inferred 1,222 1.59 19.37
Total
Measured - - -
Indicated 4,416 1.45  64.20
MES+IND3 4,416 1.45   64.20
Inferred 2,078        0.98  20.46
Sources: SRK
Notes:
1 The information relates to Mineral Resource conversion is based  on information compiled by Mr. Liang Li, MAusIMM, and
Dr. Anshun Xu, FAusIMM, employees  of SRK Consulting China Ltd. Both Dr. Xu and Mr. Li have sufficient experience
relevant to the style of mineralisation and type of deposit under consideration and to the activity which they are undertaking
to qualify as Competent Persons as defined in JORC (2012).  Dr.  Xu supervised the work of Mr. Li.  Dr. Xu and Mr. Li
consent to the reporting of this information in the form and context in which it appears.
2 Total may not add due to rounding discrepancies.
3 MES+IND: combined measured and Indicated, Mineral Resource.
4 The cut-off grade depends on ore type (Otyp) and mining method.  For open pit mining and copper stockpiles, the cut-off
grade of oxide ores is 0.7% Cu, the cut-off grade of primary ores is 0.3% Cu. For Underground mining, the cut-off grade of
primary oxide ores is 0.8% Cu.
– IIIB-105 –
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FOR THE SEPON GOLD AND COPPER MINE


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11 Ore Reserve Estimates
The JORC (2012) provide for a direct relationship between Indic ated Mineral Resources and
Probable Ore Reserve and between Measured Mineral Resources and  Proved Ore Reserve. As
shown in Figure 11-1 below.
Figure 11-1: Relationship Between Mineral Resources and Ore Res erves

Sources: JORC (2012)
The following statement has been extracted from the JORC (2012) for reference:
“An ‘Ore Reserve’ is the economically mineable part of a Measur ed and/or Indicated Mineral
Resource. It includes diluting materials and allowances for los ses, which may occur when the
material is mined or extracted and is defined by studies at Pre -Feasibility or Feasibility level as
appropriate that include application of Modifying Factors. Such studies demonstrate that, at the time
of reporting, extraction could reasonably be justified.”
“The reference point at which Reserves are defined, usually the  point where the ore is delivered to
the processing plant, must be stated. It is important that, in all situations where the reference point
is different, such as for a saleable product, a clarifying statement is included to ensure that the reader
is fully informed as to what is being reported.”
11.1 Introduction
The gold deposits that are being or to be exploited include DSE  OP, DSW OP, NLU OP, NMK OP,
Far West Area (Including MAI OP, NON OP, NKN OP), DSE UG, DSW U G. The copper deposits
that are being or to be exploited include KHN UG, TKM OPs.
– IIIB-106 –
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DSE UG, DSW UG and KHN UG will be developed as underground mine s, while all the other
deposits will be continued as open pits.
Among these gold and copper deposits, only DSE OP, DSW OP, NLU OP, NMK OP, DSE UG, and
KHN UG possess Measured and Indicated Mineral Resources. Additionally, KHN UG is currently in
the re-feasibility study stage. Consequently, open-pit gold mines including DSE OP, DSW OP, NLU
OP and NMK OP could be converted to Ore Reserves from their Min eral Resources. For
underground gold mines, only DSE UG would be considered for est imating Ore Reserves. None of
the copper deposits would be considered for estimating Ore Reserves..
The location of the deposits considered in the Ore Reserve esti mation review, are shown in Figure
11-2.
Figure 11-2: Plan View of Ore D eposits to Estimate Ore Reserves

Sources: SRK
In addition to these deposits, there are dozens of stockpiles on site to supply (tonnes & grade) gold
and oxide copper ore feed to the processing plant.
As of 30 September 2024, SRK estimated Ore Reserves from these deposits and stockpiles.
– IIIB-107 –
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11.2 Feasibility Study
SRK was provided with the Sepon Gold Project Study (“SGPS”) rev ised on 18 March 2020.  AMC
Consultants Pty Ltd (“AMC”) completed the Mining, Geotechnical and Ore Reserves components of
the SGPS.
As of 30 September 2024, SRK noted that the mineral resource models, final open pit designs, and
underground mining study have changed since completion of SGPS.
For gold operations, LXML has gradually transitioned from open pit mining with stockpiles to a
combination of open pit and underground mining with stockpiles.  Developing the DSE UG for
underground mining and the Far West Area for open pit mining would extend the mine life of LXML.
The oxide and primary gold processing capacity is 3.8 million Mtpa run-of-mine (“RoM”).
For copper operations, LXML currently only processes oxide copp er ore from stockpiles, utilizing
hydrometallurgy processing. LXML aims to develop the TKM OPs to  exploit more oxide copper ore
to maintain its oxide copper production. In the meantime, developing the KHN UG to exploit primary
copper ore is under technical studies. Historical production da ta of the copper plant shows that 0.5
to 1.3 Mtpa oxide copper ore were processed.
SRK was also provided with Geotechnical Review - Open Pit & Underground revised on 4 December
2023. MEC Mining Pty Ltd (“MEC”) provided a critical review of the geotechnical design and
operational function relating to the underground and open pit mines. It was believed that geotechnical
risk to be managed well in LXML. MEC has also provided a comprehensive list of improvements
opportunities and believed that there were only minor recommendations that MEC considers a high
priority.
As of 30 September 2024, SRK was provided with the updated mineral resource models, final open
pit designs, underground mine designs, financial results, and c apital report by LXML. SRK will
estimate Ore Reserves based on the data provided by LXML with minimal modification.
11.3 Mineral Resource Models
Ore Reserves estimation was c onducted based on mineral resource  models constructed by LXML
between in February to March 2024 and September 2023 (nlu_gc.bmf).
Block models have been updated based on sustaining exploration updates.  SRK was provided with
six latest block models.  After review of these block models, SRK noted that:
 The block model covering DSE OP (“dse_gc_29032024.bmf”) has fie lds to support
preliminary reporting of Ore Reserves.
 The block model covering DSW OP (“dsw_gc_03022024.bmf”) has fie lds to support
preliminary reporting of Ore Reserves.
 The block model covering NMK OP (“nkk_gc300324.bmf”) has fields to support preliminary
reporting of Ore Reserves.
 The block model covering NLU OP (“nlu_gc160324.bmf together with nlu_gc.bmf”) has fields
to support preliminary reporting of Ore Reserves.
 The classification notes (“MR 2023 Classification Notes.xlsx”) which explains how LXML
geologists define the geological confidence in open pit mines h ave fair and adequate
information to support preliminary reporting of Ore Reserves.
– IIIB-108 –
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 The block model covering DSC_UG (“DSC_UG_FEB24.bmf”) has fields  to support
preliminary reporting of Ore Reserves.
These block models were applied by SRK to estimate Ore Reserves.
11.4 Open Pit Mining
11.4.1 Month-end Map
SRK was provided with the Month-end map in March 2024 together with topography in December
2023 which has the pre-backfill data with a scale of 1:1000.  The map covers those deposits that are
working or in plan.  After review of the Month-end map, SRK con sidered it is detailed enough to
support Ore Reserves estimate.
11.4.2 Open Pit Design
Ever since the completion of SGPS, open-pit designs have been updated by LXML mining engineers.
SRK understands that the typical life of mine (“LoM”) for an open pit is several months due to small
size of open pit.  Open pit designs have been updated by LXML based on exploitation status, update
of mineral resource models and other modifying factors.
SRK was provided with latest final open pit designs applied by LXML.  Comparison between open-
pit designs and survey of Month-end maps shows that the difference is little.  SRK considered that it
is technically feasible to guide mining boundaries based on the  updated final open pit designs, and
that the open pit designs can be used directly to support Ore Reserves estimate.
11.4.3 Cut-off Grade
The data in Table 11-1 provided, in SRK’s opinion, was sufficient to verify cut-off grades to estimate
Ore Reserves as of 30 September 2024, as it is shown in Table 11-2.
Table 11-1 Unit Operating Co st of Open Pit Gold Mining
Item Unit
Actual  Budget
2021 2022 2023 1Q-
3Q2024
 2024
OP Mining  USD/Ore&Waste  3.1   3.0   2.7  3.2   3.4
Processing Oxide Gold USD/milled ton 17.1 18. 5  16.9  14.0 15.7
Processing Primary Gold USD/milled ton  62.1   69. 7   56.6   51. 6   48.0
G&A USD/milled ton 20.4 9.0  9.8  9.6 8.7
Overall Recovery Gold  %  54.6 63.8 64.1 61.0 68.4
Sources: LXML
Table 11-2: Gold Cut-off Grade Calculation
 Item  Unit Oxide Gold  Primary Gold
 Gold Price  USD/oz  2,050.0 2,050.0
– IIIB-109 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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 Item  Unit Oxide Gold  Primary Gold
 Gold Price   USD/g  66.9 66.9
 Processing USD/milled ton 17.0 55.0
 Processing Recovery  %  65.0 65.0
 G&A USD/milled ton 9.0 9.0
 Cut-off Grade   g/t  0.6 1.5
Sources: SRK
1 Due to short life of open pit mining, a short-term price is considered more applicable than a long-term price to calculate cut-
off grade.
11.4.4 Dilution and Loss
Same with LXML, mining dilution at 7.5% and mining loss at 5.0% were applied when estimating Ore
Reserves.
11.4.5 DSE OP
Comparison of DSE OP, end-of-month map and final open pit design is shown in Figure 11-3.
Figure 11-3: Comparison between Month-end Status and Final Open  Pit Design for DSE OP

Month-end Map, as of 30 September 2024
– IIIB-110 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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    Final
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Final Open Pit Design
Sources: SRK
Table 11-3 is showing key parameters when estimating Ore Reserves for DSE OP.
Table 11-3: Key Parameters of Ore Reserves Estimate (DSE OP)
Item Description
Mining method Open Pit Mining
Cut-off Au grade Oxide Ore: 0.6g/t; Primary Ore: 1.5g/t
Mining loss rate 5%
Mining dilution rate 7.5%
Sources: LXML and SRK
The DSE OP statement of Ore Reserves is shown in Table 11-4.
Table 11-4: Ore Reserves Estimate  of DSE OP Deposit, as of 30 September 2024 1, 3, 4
Type Category Tonnage
(kt)
Au Grade
(g/t)
Au Metal Contained
(t)
Au Metal
Contained (koz)
Oxide Proved -   -   -    -
- Probable  482   1. 50   0.72   23
- Sub-total 2 482 1.50 0.72  23
Primary Proved -   -   -    -
- Probable  -     -     -     -
- Sub-total 2 -   -   -    -
– IIIB-111 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Type Category Tonnage
(kt)
Au Grade
(g/t)
Au Metal Contained
(t)
Au Metal
Contained (koz)
Total 2 Proved -   -   -    -
- Probable  482   1. 50   0.72   23
- Total 482 1.50 0.72  23
Sources: SRK
1 The information relates to Ore Reserve conversion is based on i nformation compiled by Mr. Erwei Lu and Mr. Yonggang
Wu and Dr. Anshun Xu, FAusIMM, employees of SRK Consulting Chin a Ltd. Mr. Lu, Mr. Wu and  Dr. Xu have sufficient
experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which Mr. Wu
is undertaking to qualify as Competent Person as defined in JOR C (2012).  Mr. Wu and Dr. Xu supervised the work of Mr.
Lu. Mr. Wu, Mr. Lu and Dr. Xu consent to the reporting of this information in the form and context in which it appears.
2 Total may not add due to rounding discrepancies.
3 The Ore Reserves are included in the Mineral Resources.  They should not be added to the Mineral Resources.
4 The Ore Reserves Statement is based on the depletion data provided by LXML for the six-month period, 1 April 2024 to 30
September 2024. The reported LXML data may differ from that rep orted by SRK, due the updated block model now used
by LXML for reporting. SRK considers this updated block model t o be more representative of actual production conditions
and has therefore adopted the LXML provided data as the basis for this statement
11.4.6 DSW OP
Comparison of DSW OP, Month-end map and final open pit designs is shown in Figure 11-4.
Figure 11-4: Comparison between Month-end Status and Final Open Pit Designs for DSW OP
Month-end Map, as of 30 September 2024
– IIIB-112 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


--- page 1390 ---
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    Final
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Final Open Pit Design
Sources: SRK
Table 11-5 is showing key parameters when estimating Ore Reserves for DSW OP.
Table 11-5: Key Parameters of Ore Reserves Estimate (DSW OP)
Item Description
Mining method Open Pit Mining
Cut-off Au grade Oxide Ore: 0.6 g/t; Primary Ore: 1.5 g/t
Mining loss rate 5%
Mining dilution rate 7.5%
Sources: LXML and SRK
The DSW OP statement of Ore Reserves is shown in Table 11-6.
Table 11-6: Ore Reserves Estimate  of DSW OP Deposit, as of 30 September 20241, 3, 4
Type Category Tonnage
(kt)
Au Grade
(g/t)
Au Metal Contained
(t)
Au Metal Contained
(koz)
Oxide Proved  -     -     -     -
- Probable  12  0.95 0.01  0.4
- Sub-total  2  12   0.95   0.01   0.4
Primary Proved  -    -   -    -
- Probable  18   6.87   0.12   4
- Sub-total  2  18  6.87 0.12  4
Total 2 Proved  -     -     -     -
- Probable  30  4.52 0.14  4
– IIIB-113 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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    Final
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Type Category Tonnage
(kt)
Au Grade
(g/t)
Au Metal Contained
(t)
Au Metal Contained
(koz)
- Total  30  4.52 0.14  4
Sources: SRK
1 The information relates to Ore Reserve conversion is based on i nformation compiled by Mr. Erwei Lu and Mr. Yonggang
Wu and Dr. Anshun Xu, FAusIMM, employees of SRK Consulting Chin a Ltd. Mr. Lu, Mr. Wu and  Dr. Xu have sufficient
experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which Mr. Wu
is undertaking to qualify as Competent Person as defined in JOR C (2012).  Mr. Wu and Dr. Xu supervised the work of Mr.
Lu. Mr. Wu, Mr. Lu and Dr. Xu consent to the reporting of this information in the form and context in which it appears.
2 Total may not add due to rounding discrepancies.
3 The Ore Reserves are included in the Mineral Resources.  They should not be added to the Mineral Resources.
4 The Ore Reserves Statement is based on the depletion data provided by LXML for the six-month period, 1 April 2024 to 30
September 2024. The reported LXML data may differ from that rep orted by SRK, due the updated block model now used
by LXML for reporting. SRK considers this updated block model t o be more representative of actual production conditions
and has therefore adopted the LXML provided data as the basis for this statement
11.4.7 NMK OP
Comparison of the NMK OP Month-end map and final open pit designs is shown in Figure 11-5.
Figure 11-5: Comparison between Month-end Status and Final Open  Pit Designs for NMK OP

Month-end Map, as of 30 September 2024
– IIIB-114 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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    Final
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Final Open Pit Design
Sources: SRK
Table 11-7 is showing key parameters when estimating Ore Reserves for NMK OP.
Table 11-7: Key Parameters of Ore Reserves Estimate (NMK OP)
Item Description
Mining method Open Pit Mining
Cut-off Au grade Oxide Ore: 0.6g/t; Primary Ore: 1.5 g/t
Mining loss rate 5%
Mining dilution rate 7.5%
Sources: LXML and SRK
The NMK OP statement of Ore Reserves is shown in Table 11-8.
Table 11-8: Ore Reserves Estimate  of NMK OP Deposit, as of 30 September 20241, 3, 4
Type Category Tonnage
(kt)
Au Grade
(g/t)
Au Metal Contained
(t)
Au Metal Contained
(koz)
Oxide Proved  30   0. 97   0.03   1
- Probable  1,030   1.20 1.24  40
- Sub-total
2
 1,060   1.19   1.26   41
Primary Proved  1   2. 59   0.00   0
- Probable  263   3.19 0.84  27
- Sub-total
2
 264   3.19   0.84   27
Total 2 Proved  31   1. 03   0.03   1
- Probable  1,294   1.60 2.08  67
- Total  1,324   1. 59   2.11   68
– IIIB-115 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Competent Person's Report for the Sepon Gold and Copper Project, Lao People's Democratic Republic
    Final
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Sources: SRK
1 The information relates to Ore Reserve conversion is based on i nformation compiled by Mr. Erwei Lu and Mr. Yonggang
Wu and Dr. Anshun Xu, FAusIMM, employees of SRK Consulting Chin a Ltd. Mr. Lu, Mr. Wu and  Dr. Xu have sufficient
experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which Mr. Wu
is undertaking to qualify as Competent Person as defined in JOR C (2012).  Mr. Wu and Dr. Xu supervised the work of Mr.
Lu. Mr. Wu, Mr. Lu and Dr. Xu consent to the reporting of this information in the form and context in which it appears.
2 Total may not add due to rounding discrepancies.
3 The Ore Reserves are included in the Mineral Resources.  They should not be added to the Mineral Resources.
4 The Ore Reserves Statement is based on the depletion data provided by LXML for the six-month period, 1 April 2024 to 30
September 2024. The reported LXML data may differ from that rep orted by SRK, due the updated block model now used
by LXML for reporting. SRK considers this updated block model t o be more representative of actual production conditions
and has therefore adopted the LXML provided data as the basis for this statement
11.4.8 NLU OP
Comparison of NLU OP, Month-end map and final open pit designs is shown in Figure 11-6.
Figure 11-6: Comparison between Month-end Status and Final Open  Pit Designs for NLU OP
Month-end Map, as of 30 September 2024
– IIIB-116 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Final Open Pit Design
Sources: SRK
Table 11-9 is showing key parameters when estimating Ore Reserves for NLU OP.
Table 11-9: Key Parameters of Ore Reserves Estimate (NLU OP)
Item Description
Mining method Open Pit Mining
Cut-off Au grade Oxide Ore: 0.6 g/t; Primary Ore: 1.5 g/t
Mining loss rate 5%
Mining dilution rate 7.5%
Sources: LXML and SRK
The NLU OP statement of Ore Reserves is shown in Table 11-10.
Table 11-10: Ore Reserves Estima te of NLU OP Deposit, as of 30 September 20241, 3, 4
Type Category Tonnage
(kt)
Au Grade
(g/t)
Au Metal
Contained
(t)
Au Metal
Contained (koz)
Oxide Proved -   -   -     -
 Probable  73   1.17   0.09   3
 Sub-total 2 73 1.17 0.09   3
Primary Proved  -     -     -     -
 Probable 297 3.56 1.06   34
 Sub-total 2  297   3.56   1.06   34
Total 2 Proved -   -   -     -
 Probable  370   3.09   1.14   37
 Total 370 3.09 1.14   37
Sources: SRK
– IIIB-117 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


--- page 1395 ---
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1 The information relates to Ore Reserve conversion is based on i nformation compiled by Mr. Erwei Lu and Mr. Yonggang
Wu and Dr. Anshun Xu, FAusIMM, employees of SRK Consulting Chin a Ltd. Mr. Lu, Mr. Wu and  Dr. Xu have sufficient
experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which Mr. Wu
is undertaking to qualify as Competent Person as defined in JOR C (2012).  Mr. Wu and Dr. Xu supervised the work of Mr.
Lu. Mr. Wu, Mr. Lu and Dr. Xu consent to the reporting of this information in the form and context in which it appears.
2 Total may not add due to rounding discrepancies.
3 The Ore Reserves are included in the Mineral Resources.  They should not be added to the Mineral Resources.
4 The Ore Reserves Statement is based on the depletion data provided by LXML for the six-month period, 1 April 2024 to 30
September 2024. The reported LXML data may differ from that rep orted by SRK, due the updated block model now used
by LXML for reporting. SRK considers this updated block model t o be more representative of actual production conditions
and has therefore adopted the LXML provided data as the basis for this statement
11.4.9 SKM OP
LXML completed SKM OP exploitation in July 2024.
11.5 Underground Mining
Underground mining is new to LXML. It is located beside of DSE OP, and its decline access is built
at the DSE OP.
11.5.1 Mined-out Area
A decline and other development system are being driven to prov ide an access to deep mineral
resources.  SRK was provided with three-dimensional (“3D”) surv ey of the actual development and
stopes. Figure 11-7 is showing the decline development end face  and one of the stopes which was
mined out during site visit.
Figure 11-7: DSE UG Underground Site Visiting Photos
Decline Development End Mined Stope
Sources: SRK
After review of the survey data, SRK considered it will not affect Ore Reserves estimation and mined-
out area would be deducted.
11.5.2 Underground Design
The design has been updated by LXML based on updated block model, costs and other assumptions.
The latest designs of tunnels and stopes are shown in Figure 11-8.
– IIIB-118 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Figure 11-8: Underground Design for DSE UG
Sources: LXML
11.5.3 Cut-off Grade
The data in Table 11-11 provided, in SRK’s opinion, was sufficient to verify cut-off grades to estimate
Ore Reserves as of 30 September 2024, as it is shown in Table 11-12.
Table 11-11 Summary of Gold Production and Operating Cost
Item Unit
Actual Budget
2021 2022 2023 1Q-3Q2024 2024
UG Mining USD/mined ton  -    28.8  49.2 35.2   -
Processing Primary
Gold
USD/milled ton  62.1  69.7  56.6 51.6   48.0
G&A USD/milled ton 20.4 9.0 9.8 9.6  9.3
Overall Recovery Gold % 54.6 63.8 64.1 61.0 68.4
Sources: LXML
Table 11-12: Gold Cut-off Grade Calculation
Item Unit Underground Primary
 Gold Price USD/oz 2,050.0
 Mining  USD/mined ton 30.0
 Processing Cost for Primary Gold USD/milled ton 55.0
– IIIB-119 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Item Unit Underground Primary
 Processing Recovery % 65.0
 G&A  USD/milled ton  9.0
 Backfilling 1 USD/mined ton 5.0
Cut-off Grade   g/t  2.6
Sources: SRK
1 The backfilling cost is widely used for a simple study.
11.5.4 Ore Reserve model
During SRK’s review of the data, it was found that the stope design is not appropriate for estimating
of Ore Reserves. After discussing with LXML Technical Personnel , it was agreed that SRK re-ran
the stope optimization to generate new stope wireframe to guide the Ore Reserves estimation. The
key parameters for re-running the DSE UG stope optimization are summarised in Table 11-13.
Table 11-13: Key Parameters of Stope Optimization
Item Description
Mining method Underground Sub-Level Open Stope with Backfilling
Cut-off Au grade to optimize stope boundary 2.0 to 2.5g/t
Footwall angle >=42°and following ore/waste boundary
Stope height 20m
Stope length 20m
Stope width >=5m
Cut-off Au grade of feed ore 2.6g/t
Sources: LXML
A stope optimisation exercise was  then carried out using the De swik Stope Optimizer (“SO”) with
stope design parameters showing in Table 11-13.
In addition, economic attributes and physical constrains of the  sliced stopes with modifying factors
include spatial location, unplanned mining dilution and loss, c ut-off grade, were also considered to
ensure stopes generated were technical feasible as well as economic.
Figure 11-9 graphically shows how the stopes (together with LXML’s development design) look like.
– IIIB-120 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Figure 11-9: Stope Optimization Results
Sources: SRK
11.5.5 Dilution and Loss
Table 11-14 summarizes the modifying factors used for Ore Reserves estimation.
Table 11-14:  Modifying Factors Used for Ore Reserves Estimation
Factors Rate Description
General Stope Recovery 95% Planed loss: Backfilled stopes , with sharp corner and crown/sill pillar loss
Mining Dilution 15% Unplanned dilution: overbreak, considering diluted material as waste with
no grade.
Mining Recovery 95% Unplanned loss: underbreak, bas ed on reconciliation analysis.
Sources: SRK
When making the underground designs, modifying factors includin g mining dilution (at 15%) and
mining loss (at 10%) have been applied by LXML. After completin g each stope, LXML conducted
reconciliation to summarize the results of their underground mi ning performance. Figure 11-10 is
showing the comparison of designed stope with as-built stope for DDE 1800 W1. The overbreak and
underbreak were then calculated to be used for unplanned mining dilution and loss analysis. Figure
11-11 summarizes the stope performance after comparing designed stopes with as-built stopes.
– IIIB-121 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Figure 11-10:  Overbreak and Underbreak Analysis
Sources: LXML
Figure 11-11:  Stope Performance Summary
Sources: SRK
The average of mining dilution is 14% and mining loss is 6%. When conducting estimation, unplanned
mining dilution at 15% (same with LXML) and mining loss at 5% (compared with LXML at 10%) were
applied.
11.5.6 Ore Reserve Estimates
According to JORC (2012), Measured Resources are typically conv erted into the Proved Reserve
category, and Indicated Resources are converted into Probable Reserve.
The estimated Mining Inventory based on Mineral Resources and m odifying factors is summarized
in Table 11-15 and the estimation process is illustrated in waterfall charts shown in Figure 11-12 and
Figure 11-13.
– IIIB-122 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Table 11-15: Estimates Process Summary
Process Tonnes Au Contained (kg)
M+I+I Resources 4,320,842   30,561
Inferred Resources  (1,236,722)  (8,678)
Remained MI 3,084,120   21,884
SO  (957,014)  (6,156)
Planned Dilution 1,105,594   (158)
Unplanned Dilution  517,905   0
Unplanned Loss (245,380)  (820)
Ore Reserves  3,505,224   14,749
Sources: SRK
Figure 11-12:  Estimates Process - Change in Tonne
Sources: SRK

– IIIB-123 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Figure 11-13:  Estimates Process - Change in Metal Contained
Sources: SRK
The Ore Reserves for the DSE UG are presented in Table 11-16 by  reserve category. The primary
reason why the Ore Reserves tonnes exceed the MI resources tonnes is due to both planned dilution
during the Stope Optimizer (SO) process and unplanned overbreak  dilution, as illustrated in Figure
11-12. As it is showed in Figure 11-13, Inferred Mineral Resour ces and SO (27% of total M+I+I
Resources contained metal), is the key factors which affects to Ore Reserves conversion.
11.5.7 Ore Reserve Statement
The DSE UG statement of Ore Reserves is shown in Table 11-16. T otal Ore Reserves contained
metal (Proved plus Probable) is approximately 69% of Mineral Resources (Measured plus Indicated).
Table 11-16: Ore Reserves Estimate of DSE UG Deposit, as of 30 September 20241, 3
Type Category Tonnage
(kt)
Au Grade
(g/t)
Au Metal
Contained
(t)
Au Metal
Contained (koz)
Oxide Proved -   -   -     -
- Probable  -     -     -     -
- Sub-total 2 -   -   -     -
Primary Proved  237   5.18   1.23   40
- Probable 3,268 4.14 13.52   435
- Sub-total 2  3,505   4.21   14.75   474
Total 2 Proved 237 5.18 1.23   40
- Probable  3,268   4.14   13.52   435
– IIIB-124 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Type Category Tonnage
(kt)
Au Grade
(g/t)
Au Metal
Contained
(t)
Au Metal
Contained (koz)
- Total  3,505   4.21   14.75   474
Sources: SRK
1 The information relates to Ore Reserve conversion is based on i nformation compiled by Mr. Erwei Lu and Mr. Yonggang
Wu and Dr. Anshun Xu, FAusIMM, employees of SRK Consulting Chin a Ltd. Mr. Lu, Mr. Wu and  Dr. Xu have sufficient
experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which Mr. Wu
is undertaking to qualify as Competent Person as defined in JOR C (2012).  Mr. Wu and Dr. Xu supervised the work of Mr.
Lu. Mr. Wu, Mr. Lu and Dr. Xu consent to the reporting of this information in the form and context in which it appears.
2 Total may not add due to rounding discrepancies.
3 The Ore Reserves are included in the Mineral Resources.  They should not be added to the Mineral Resources.
4 The Ore Reserves Statement is based on the depletion data provided by LXML for the six-month period, 1 April 2024 to 30
September 2024. The reported LXML data may differ from that rep orted by SRK, due the updated block model now used
by LXML for reporting. SRK considers this updated block model t o be more representative of actual production conditions
and has therefore adopted the LXML provided data as the basis for this statement.
11.6 Stockpiles
11.6.1 Cut-off Grade
For gold stockpiles, the same cut-off grade with open-pit mining was applied for oxide and primary
gold stockpiles when estimating Ore Reserves.
For copper stockpiles, back to the time when TKM area was in op eration, mineralization was
classified into many stockpiles based on several attributes including copper grade and gangue acid
consumption (“GAC”). And to define cut-off grade, LXML was using the lowest grade blocks included
in the ore stockpiles which is 1.1%. TKM area is currently being re-modelled and will be subsequently
re-assessed along with cut-off criteria but no update to this is available now.
By considering the current copper operation, only oxide copper stockpiles are being processed by
using hydrometallurgy technique and there have not been enough studies to support how the primary
copper stockpiles would be processed. Therefore, when estimating copper Ore Reserves, only oxide
copper stockpiles would be considered.
Table 11-17 and Table 11-18 are showing the summary of copper production cost and how the oxide
copper cut-off grade was calculated.
Table 11-17 Summary of Copper Production Cost
Item Unit
Actual Budget
2021 2022 2023 1Q-
3Q2024 2024
OP Mining USD/Ore&Waste  3.1 -    -    -    -
Processing Copper USD/milled ton 47.6 36. 0  23.0   19.6 31.7
Overall Recovery Copper  %  68.4 59.2 52.5 44.1 41.5
Sources: LXML
– IIIB-125 –
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Table 11-18: Copper Cut-off Grade Calculation
 Item  Unit  Oxide Copper
Copper Price USD/t Cu 8,300.0
Processing  USD/milled ton 35.0
 Processing Recovery % 45.0
 G&A USD/milled ore 0.0
 Sales and transport USD/t Cu 40.0
Cut-off Grade   % 0.9
Sources: SRK
1 2024Q1 CMF price was applied.
11.6.2 Gold Stockpile
SRK was provided with summary details of the LXML gold stockpil es (“Au_WK39
Inventory_260924_Sep_EOM.xls”) as of 30 September 2024.  There are 41 stockpiles on site, of
which 15 are oxide gold stockpiles, and 26 are primary gold stockpiles that are available to process,
and among these 41 stockpiles, 35 stockpiles were economically feasible to be converted to
Probable Ore Reserves categories.
The gold stockpile statement of Ore Reserves is shown in Table 11-19.
Table 11-19: Ore Reserves Estima te of Gold Stockpile, as of 30 September 2024 1, 3, 4, 5
Type Category Tonnage
(kt)
Au Grade
(g/t)
Au Metal
Contained
(t)
Au Metal
Contained (koz)
Oxide Proved -   -   -     -
- Probable 361 1.91 0.69   22
- Sub-total 2  361   1.91   0.69   22
Primary Proved -   -   -     -
- Probable  1,823   2.75   5.02   161
- Sub-total 2 1,823 2.75 5.02   161
Total 2 Proved  -     -     -     -
- Probable 2,185 2.61 5.71   183
- Total  2,185   2. 61   5.71   183
Sources: SRK
1 The information relates to Ore Reserve conversion is based on i nformation compiled by Mr. Erwei Lu and Mr. Yonggang
Wu and Dr. Anshun Xu, FAusIMM, employees of SRK Consulting Chin a Ltd. Mr. Lu, Mr. Wu and  Dr. Xu have sufficient
experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which Mr. Wu
is undertaking to qualify as Competent Person as defined in JOR C (2012).  Mr. Wu and Dr. Xu supervised the work of Mr.
Lu. Mr. Wu, Mr. Lu and Dr. Xu consent to the reporting of this information in the form and context in which it appears.
2 Total may not add due to rounding discrepancies.
3 By reviewing the data summary details and production records, e specially the feed grade, which is showing reasonably
reconcilable, therefore, SRK trusts the stockpiles data summary  details provided by LXML have fair and adequate
information to guide the estimation of Ore Reserves.
4 The Ore Reserves are included in the Mineral Resources.  They should not be added to the Mineral Resources.
5 The Ore Reserves Statement is based on the depletion data provided by LXML for the six-month period, 1 April 2024 to 30
September 2024. The reported LXML data may differ from that rep orted by SRK, due the updated block model now used
– IIIB-126 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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by LXML for reporting. SRK considers this updated block model t o be more representative of actual production conditions
and has therefore adopted the LXML provided data as the basis for this statement
11.6.3 Copper Stockpile
SRK was provided with summary det ails of the LXML copper stockp iles
(“Cu_wk39_Inventory_260924_Sep_EOM.xls”) as of 30 September 202 4.  There are 20 stockpiles
on site, of which 15 are oxide copper stockpiles, and 5 are pri mary copper stockpiles that are
available to process, and among these 20 stockpiles, 9 oxide stockpiles were economically feasible
to be converted to Probable Ore Reserves categories.
The copper stockpile statement of Ore Reserve is shown in Table 11-20.
Table 11-20: Ore Reserve Estimate of Copper Stockpile, as of 30  September 2024 1, 3, 4, 5
Type Category Tonnage
(kt)
Cu Grade
(%) Cu Metal Contained (kt)
Oxide Proved  -     -     -
- Probable 1,185 0.93  11.05
- Sub-total 2  1,185   0.93   11.05
Primary Proved -   -    -
- Probable  -     -     -
- Sub-total 2 -   -    -
Total 2 Proved -   -    -
- Probable  1,185   0.93   11.05
- Total 1,185 0.93  11.05
Sources: SRK
1 The information relates to Ore Reserve conversion is based on i nformation compiled by Mr. Erwei Lu and Mr. Yonggang
Wu and Dr. Anshun Xu, FAusIMM, employees of SRK Consulting Chin a Ltd. Mr. Lu, Mr. Wu and  Dr. Xu have sufficient
experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which Mr. Wu
is undertaking to qualify as Competent Person as defined in JOR C (2012).  Mr. Wu and Dr. Xu supervised the work of Mr.
Lu. Mr. Wu, Mr. Lu and Dr. Xu consent to the reporting of this information in the form and context in which it appears.
2 Total may not add due to rounding discrepancies.
3 By reviewing the data summary details and production records, e specially the feed grade, which is showing reasonably
reconcilable, therefore, SRK trusts the stockpiles data summary  details provided by LXML have fair and adequate
information to guide the estimation of Ore Reserves.
4 The Ore Reserves are included in the Mineral Resources.  They should not be added to the Mineral Resources.
5 The Ore Reserves Statement is based on the depletion data provided by LXML for the six-month period, 1 April 2024 to 30
September 2024. The reported LXML data may differ from that rep orted by SRK, due the updated block model now used
by LXML for reporting. SRK considers this updated block model t o be more representative of actual production conditions
and has therefore adopted the LXML provided data as the basis for this statement.
11.7 Production Schedule
Production schedule prepared by SRK based on gold and copper minerals are shown in Table 11-21.
Table 11-21: Production Schedule of LXML
Type Unit Total 2024 2025 2026 2027 2028 2029 2030
Gold Production
Open pit mining
Ore tonnage kt 2,206  956   829   421  - - - -
– IIIB-127 –
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FOR THE SEPON GOLD AND COPPER MINE


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Au grade g/t 1.86  1.35   1.66   3.43  - - - -
Au metal kg  4,106
1,290
 1,372   1,444  - - - -
Waste tonnage kt
15,374

5,775
 3,180   6,420  - - - -
Stockpile rehandling
Ore tonnage kt  2,185   259
1,230
 696  - - - -
Au grade g/t 2.61  1.19  2.34  3.63  - - - -
Au metal kg  5,707   307
2,878

2,522 - - - -
Underground mining
Ore tonnage kt 3,505  219   744   793   770   546   402   31
Au grade g/t 4.21  3.71   4.94   4.53   3.61   3.81   4.25   3.21
Au metal kg
14,745
 815   3,676   3,592   2,774   2,082   1,705   101
Copper Production
Stockpile rehandling
Ore tonnage kt 1,185  447  738 - - - - -
Cu grade  % 0.93  0.91  0.95 - - - - -
Cu metal kt 11  4  7 - - - - -
Sources: SRK
11.8 Conclusions and Recommendations
The data provided by LXML to SRK was suitable in most cases to estimate the Ore Reserves. The
summary outcomes are:
 The Ore Reserves estimation is primarily based on SGPS and LXML technical personnel’s
studies.
 Gold and copper cut-off grades are applied when estimating Ore Reserves.
 The modifying factors like mining loss, mining dilution are app lied by using the design data
collected from LXML with minimal adjustment.
 SRK noted that the production plan prepared by LXML assumed that Inferred Mineral Resources
will be exploited together with those Measured and Indicated Mineral Resources in years
between 2024 and 2026.  Exclusive of most of Inferred Mineral R esources usually leads to a
shorter operating period with estimation of Ore Reserves.
The LXML gold statement of Ore Reserves is shown in Table 11-22.
Table 11-22: Ore Reserves Estimate of Gold Minerals in Total, a s of 30 September 2024 1, 3,4, 5
Type Category Tonnage
(kt)
Au Grade
(g/t)
Au Metal
Contained
(t)
Au Metal
Contained
(koz)
Oxide Proved  30   0.97   0.03   1
- Probable 1,959 1.40 2.75   88
- Sub-total 2  1,989   1.40   2.78   89
Primary Proved 239 5.17 1.23   40
- Probable  5,669   3.63   20.56   661
– IIIB-128 –
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FOR THE SEPON GOLD AND COPPER MINE


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Type Category Tonnage
(kt)
Au Grade
(g/t)
Au Metal
Contained
(t)
Au Metal
Contained
(koz)
- Sub-total 2  5,907   3.69   21.79   700
Total 2 Proved 268 4.70 1.26   41
- Probable  7,628   3.05   23.30   749
- Total 7,896 3.11 24.56   790
Sources: SRK
Notes:
1 The information relates to Ore Reserve conversion is based on i nformation compiled by Mr. Erwei Lu and Mr. Yonggang
Wu and Dr. Anshun Xu, FAusIMM, employees of SRK Consulting Chin a Ltd. Mr. Lu, Mr. Wu and  Dr. Xu have sufficient
experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which Mr. Wu
is undertaking to qualify as Competent Person as defined in JOR C (2012).  Mr. Wu and Dr. Xu supervised the work of Mr.
Lu. Mr. Wu, Mr. Lu and Dr. Xu consent to the reporting of this information in the form and context in which it appears.
2 Total may not add due to rounding discrepancies.
3 The Ore Reserves are included in the Mineral Resources.  They should not be added to the Mineral Resources.
4 For gold stockpiles, by reviewing the data summary details and production records, especially the feed grade, which is
showing reasonably reconcilable,  therefore, SRK trusts the stoc kpiles data summary details provided by LXML have fair
and adequate information to guide the estimation of Ore Reserves.
5 The Ore Reserves Statement is based on the depletion data provided by LXML for the six-month period, 1 April 2024 to 30
September 2024. The reported LXML data may differ from that rep orted by SRK, due the updated block model now used
by LXML for reporting. SRK considers this updated block model t o be more representative of actual production conditions
and has therefore adopted the LXML provided data as the basis for this statement.
The LXML copper statement of Ore Reserves is shown in Table 11-23.
Table 11-23 Ore Reserves Estimate  of Copper Minerals, as of 30 September 2024 1, 3, 4, 5
Type Category Tonnage
(kt)
Cu Grade
(%)
Cu Metal Contained
(kt)
Oxide Proved  -     -   -
- Probable  1,185   0.93   11.05
- Sub-total
2
 1,185   0.93   11.05
Primary Proved  -     -     -
- Probable  -     -   -
- Sub-total
2
 -     -     -
Total 2 Proved  -     -   -
- Probable  1,185   0.93   11.05
- Total  1,185   0.93 11.05
Sources: SRK
Notes:
1 The information relates to Ore Reserve conversion is based on i nformation compiled by Mr. Erwei Lu and Mr. Yonggang
Wu and Dr. Anshun Xu, FAusIMM, employees of SRK Consulting Chin a Ltd. Mr. Lu, Mr. Wu and  Dr. Xu have sufficient
experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which Mr. Wu
is undertaking to qualify as Competent Person as defined in JOR C (2012).  Mr. Wu and Dr. Xu supervised the work of Mr.
Lu. Mr. Wu, Mr. Lu and Dr. Xu consent to the reporting of this information in the form and context in which it appears.
2 Total may not add due to rounding discrepancies.
3 Only oxide copper stockpiles were considered during Ore Reserves estimation. By reviewing the data summary details and
production records, especially the feed grade, which is showing reasonably reconcilable, therefore, SRK trusts the stockpiles
data summary details provided by LXML have fair and adequate information to guide the estimation of Ore Reserves.
4 The Ore Reserves are included in the Mineral Resources.  They should not be added to the Mineral Resources.
– IIIB-129 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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5 The Ore Reserves Statement is based on the depletion data provided by LXML for the six-month period, 1 April 2024 to 30
September 2024. The reported LXML data may differ from that rep orted by SRK, due the updated block model now used
by LXML for reporting. SRK considers this updated block model t o be more representative of actual production conditions
and has therefore adopted the LXML provided data as the basis for this statement.

– IIIB-130 –
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FOR THE SEPON GOLD AND COPPER MINE


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12 Mining
12.1 Production History and Current Status
Historically, LXML (LXML Sepon) used to be an operational open-pit gold and copper mine. In 1992,
Rio Tinto discovered Sepon. In 1999, Rio Tinto sold an 80% option over Sepon to Oxiana. In 2004,
Oxiana bought Rio Tinto's remaining 20% stake in Sepon. In 2008 , Oxiana merged with Zinifex to
form OZ Minerals. In 2010, MMG acquired Sepon from OZ Minerals. In 2018, Chifeng acquired LXML
(LXML Sepon) from MMG.
As for gold and copper operations:
 Gold production commenced in 2003 but ceased in 2013 due to price fluctuations and other
factors. In 2020, gold operations resumed. Construction of the underground mine
commenced in April 2022 at DSE UG, and the first gold ore was t ransported to the surface
in 2023. Since then, the gold operation has transitioned to a c ombination of open-pit and
underground mining.
 Copper production began in 2005, and in 2021, LXML ceased open- pit copper mining
operations. Since then, the copper processing plant has only pr ocessed oxide copper
stockpiles.
Production records since year 2018 are shown in Table 12-1 for copper ore and gold ore,
respectively.
Table 12-1: Production Records of LXML
Item Unit 2018 2019 2020 2021 2022 2023 1Q- 3Q 2024
Copper Operation (Surface Mining)
Mined Ore t 2,155,808 2,178,736 1,420,165  148,924 - - 80,562.62
Waste t 22,432,995 20,799,689 16,310,493  273,195 - - -
Gold Operation (Surface Mining)
Mined Ore t - 322,309 1,888,956  4,237,161 3,794,464 2,274,715 1,626,404
Waste t - 3,653,397 11,473,595  37,118,432 32,790,592 28,678,086 13,832,608
Gold Operation (Underground Mining)
Mined Ore t - - - - - 181,057 311,347
Sources: LXML
The life of a mining location (or an open pit) is typically several months due to small quantity of open
pit.
As of 30 September 2024, the gold deposits that are being or to be exploited include DSE OP, DSW
OP, NLU OP, NMK OP, Far West Area (Including MAI OP, NON OP, NKN OP), DSE UG, DSW UG.
The copper deposits that are to be exploited include KHN UG, TKM OPs.
In addition to these deposits, there are dozens of gold and cop per stockpiles on site to feed to the
processing plant.
– IIIB-131 –
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LXML has successfully transitioned to a copper mining operation with the capability to process both
gold and copper in 2019. This transition includes the expansion  and redevelopment of existing
approved gold pits to access gold reserves located at deeper levels.
For copper operations, LXML exclusively processes oxide copper inventory sourced from historical
stockpiles.  Major changes occurred in year 2023 and first quarter of 2024 include:
 DSE UG underground development has resulted in the excavation o f approximately 512,467
tonnes of rock and the completion of 4,972 meters of total development during 2023. For the first
quarter of 2024, DSE UG has excavated about 154,810 tonnes of r ock and completed 1,706
meters of total development. As of 30 September 2024, mining has progressed to approximately
11 meters above sea level (mASL).
 In Far West Area, during a site visit in May 2024, it was observed that the road to the Far West
Area had been constructed and the topography in the area had be en cleared, as shown in the
Figure 12-1 below. According to LXML, on-site geologists were p reparing geological models
based on the latest exploration results. LXML plans to commence  production in the Far West
Area in the last quarter of 2024.
 For DSW UG, LXML is conducting additional exploration work to increase geological confidence.
Figure 12-1 below shows the exploration field during SRK's visit in November 2023.
 In the TKM OPs area, LXML has conducted pit optimization for these deposits, and the results
indicate the possibility of open-pit mining exploitation.
 Regarding the KHN UG deposit, LXML has completed a scoping-level study which indicates that
KHN UG will be exploited as an underground mine. During the site visit in May 2024, LXML was
conducting geotechnical field investigations and studies.
Figure 12-1: Far West Area a nd DSW UG Exploration Field
Far West Area, as of 15 May 2024 DSW UG Exp loration Field, as of 30 November 2023
Sources: SRK
12.2 Hydrology and Hydrogeology
LXML is located in a monsoonal climate, with a maximum rainfall of up to 170 mm per day.
The following study was reviewed by AMC in the SGPS:
– IIIB-132 –
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 “Feasibility Study Report for Surface Water Drainage and Hydrogeology”, which was prepared
by the Golder Associates Pty Ltd (‘Golder”) and dated on 13 January 2020.
The studies included:
 A data gap assessment based on the pre-feasibility study and revised mine plan;
 Hydrogeologic field investigations to advance the knowledge of the local groundwater regime
and geology features;
 Development of a hydrogeological conceptual model to support both the ESIA and the site water
management requirements;
 Numerical groundwater modelling to quantify mine dewatering pre dictions based on phases of
the mine plan development;
 The development of a calibrated surface water runoff model and two-dimensional flood model
based on measured and observed data;
 Development of feasibility level of river realignment designs a llowing the development of pits
within flood plain and water course areas; and
 Development of the mine water management plan addressing potential water quality and quantity
impacts, surface water management and pit dewatering requirements.
The realignment of two rivers is planned. The Namkok river will be diverted around the DSW OP in
two stages and the Houay Khiang creek will be diverted around the NLU OP.
12.3 Open Pit Geotechnics
12.3.1 Studies and Data
The following studies were reviewed by AMC in the SGPS:
 “Rock Mechanics Evaluation of The Primary Gold Project Deposits , Sepon Gold Copper
Operation, LAOS, P.D.R. (06641487-R01)”, which was prepared by Golder Associates Pty Ltd
(“Golder”) and dated in December 2007.
 “MMG Sepon Primary Au Geotechnical Study - Open-Pit Review (174 3_G\3156)”, which was
prepared by Mining One Consultants Pty Ltd (“Mining One”) and dated on 20 July 2012.
 “Sepon Gold Project Geotechnical Study”, which was prepared by Mining One and dated on 6
June 2019.
 “Geotechnical Review - Open Pit & Underground”, which was prepared by MEC Mining Pty Ltd
and dated on 4 December 2023.
Two geotechnical logging and testing campaigns have been comple ted to support pit design for
mining the primary gold deposits.  A summary of drill holes is shown in Table 12-2.
Table 12-2: Summary of Dr ill Holes for 2007 and 2018 Drilling Campaigns
Area Number of holes in 2007 Number of holes in 2018 Total
Discovery Main 11 5 16
– IIIB-133 –
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Area Number of holes in 2007 Number of holes in 2018 Total
Discovery West 9 5 14
Nalou 15 4 19
Total 35 14 49
Sources: SGPS
Structural mapping was done during both campaigns, with the mapping done for the three main rock
types encountered, i.e., calcareou s shale (“CSH”), dolomite (“D OL”), and rhyodacite porphyry
(“RDP”).
Laboratory testing was also performed during both campaigns. Th e 2007 testing was done by AL
Technologies (S) PTE LTD and the 2018 testing was carried out by Trilab.
The test data was validated by Mining One and the rock mass parameters shown in Table 12-3 were
used in the stability analysis i n the SGPS focused on Discovery  Main (“DSM”), Discovery West
(“DSW”) and Nalou (“NLU”) areas.
Table 12-3: Rock Mass Parameters Used for Geotechnical Analysis  by Mining One
Material UCS (median)
(MPa)
Cohesion
(kPa)
Internal friction
angle
(degrees)
Density
(mean)
(kN/m3)
mi
(Roclab)
GSI (35th
percentile)
DSM/DSW/NLU
Clay - 11.1 (35th
percentile)
25.5 (35th
percentile)
17.3 - -
Weathered - 39.6 (lower
bound)
40.8 (lower
bound)
20.6 - -
CSH Isotropic 35.8 - - 27.6 6 55/52/56
CSH
Anisotropic
- - - 27.6 - -
DOL 51.2 - - 28.2 9 56/55/60
RDP 49.7 - - 27.0 20 57/53/57
Fault Zone 4.7/1/7/1.7 - - 27.6 6 28/29/26
Sources: SGPS
12.3.2 Seismicity
LXML is situated in an area of low seismic risk, with peak ground acceleration less than 0.04g.
12.3.3 Modes of Failure
Batter-scale stability was assessed using a combination of limit equilibrium and kinematic analysis.
Overall and inter-ramp slope stability was assessed using limit  equilibrium methods.  The potential
failure modes identified by Mining One are shown below:
 Circular failure was considered the most likely mechanism in th e upper clay slopes, whereas a
combination of circular and structurally controlled failure was considered in the upper weathered
slopes.
– IIIB-134 –
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 In the fresh rock, failure was expected to be structurally cont rolled and would be plane, wedge,
or toppling failures.
12.3.4 Geotechnical Domains
Selection of the geotechnical domains is based on the results o f the limit equilibrium analyses,
kinematic analyses, and anisotropic behaviour.
12.4 Open Pit Mining
The conventional mining cycle, comprising drilling, blasting, loading, and hauling, were employed for
the extraction of ore and waste rocks. The mining operations were conducted on flitches with a height
of 2.5 meters.
12.4.1 Grade Control
The proposed method of grade control is RC drilling on a 5m x 10m pattern to a depth of 20m.
12.4.2 Open-pit Design
Open pit design parameters are summarized in Table 12-4 and Table 12-5.
Table 12-4: Mine Design Parameters
Item Unit Value Notes
Bench height m 20 the height between two berms
Minimum mining width (bench floor) m 25
Dual-lane ramp width m 16.5
Single-lane ramp width m 10.5
Ramp gradient % 12.5
Sources: SGPS
Table 12-5: Rationalised Slope Design Parameters
Domain Main Rock Units Bench Height
(m)
BFA
(degrees)
Berm Width
(m)
IRA
(degrees) Controls
Discovery Main West
All All / 27 0 27.0
Discovery Main East Weathered
All Clay and weathered 20 37.27 7 31.0
Discovery Main East Primary
1, 2, 5 CSH and DOL 20 55 9 41.0
3 CSH 20 65 7 50.8
4 CSH 20 70 7 54.5
Discover West Main Weathered
West Clay and weathered 20 42.85 7 35.0
– IIIB-135 –
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Domain Main Rock Units Bench Height
(m)
BFA
(degrees)
Berm Width
(m)
IRA
(degrees) Controls
Discovery West Main Primary
1 CSH 20 65 7 50.8
2 CSH & DRP 20 60 7 47.2
3 DOL 20 70 7 54.5
Eastern section Clay & weathered 20 42.85 7 35.0
Discover West Weathered
All Clay & weathered 20 29.12 7 25.0
Discover West Primary
1 CSH 20 65 7 50.8
2 CSH 20 50 7 40.1
3 RDP 20 70 7 54.5
4 CSH 20 65 7 50.8
Nalou Weathered
All Clay & weathered 20 34.51 7 29.0 -
Nalou Primary
1 & 8 CSH, DOL & RDP 20 70 7 54.5
2 CSH, DOL & RDP 20 55 7 43.6
3 & 4 CSH & DOL 20 70 7 54.5
5, 6 & 7 CSH 20 60 7 47.2
Sources: SGPS
12.4.3 Waste Dumps Design
Waste dumps design parameters are summarized in Table 12-6.
Table 12-6: Waste Dumps and Stockpile Design Parameters
Item Unit Value Notes
Waste swell factor  % 25
Ore stockpile swell factor  % 25
Lift height  m 10
Face/batter angle  deg 23-31
Berm width  m 5-7
Overall slope angle  deg 17-25
Dual-lane ramp width  m 16.5
Ramp grade  % 10.0
Sources: SGPS
12.4.4 Ore Stockpiles Design
Stockpiles design parameters are summarized in Table 12-6.
– IIIB-136 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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The Gold ROM Pad development will be built on the current Eastern Copper ROM.  The Gold ROM
is estimated to have a total capacity of 1.6 Mt of ore.
12.4.5 Mining Equipment
Open pit mining was outsourced to seven contractors, which are HCD, KJL, KXN, VCC, VDC, Orica,
and EIC.  Open pit mining equipment are shown in Table 12-7.
It was planned to continue mining activity with the existing fleet unless there is a convincing reason
to change.
Table 12-7: Open-pit Mining Equipment
Type Size Model Quantity
Excavator 90t CAT 390DL, XCMG XE900D, XCMG XE900C 13
Articulate Truck 40t CAT 740B 64
Drill Rig  DPI1100/DX700 Sandvik DX700, Sandvik DP1100i 5
XCMG Truck  30T XCMG NXG5650 DTQ 8
Dozer D8 & D10 CAT D8R, CAT D10R 8
Small
Excavator
20t – 45t CAT 336DL, CAT 345, XCMG XE370CA, XCMG XE215C 9
Loader  930, 950, 996 CAT 966H, CAT 908K 4
Water Truck  40t CAT 740B 5
Grader  16H CAT 14M 5
Float (Trailer) 90t MANTGA Prime Mover Trailer 1
Roller 15t XCMG XS143 1
Sources: LXML
12.4.6 Conclusions and Recommendations
The open pit mining is going to be completed in near future (about three years).  The final open pit
designs have been applied by LXML to guide mining boundaries.  Mining cycle and management
have been practised for a long time.  SRK considered no signifi cant risk will be encountered for the
open pit mining in future.
12.5 Underground Geotechnics
The following study was reviewed by AMC in the SGPS.  It highlighted the stope stability parameters
and ground support regime are obtained from a scoping study, as  opposed to a pre-feasibility level
work.
 “Discovery Deeps, High Level Geotechnical Assessment (2610_G\5803v2)”, which was prepared
by Mining One and dated on 17 June 2019.
 “Geotechnical Review - Open Pit & Underground”, which was prepared by MEC Mining Pty Ltd
and dated on 4 December 2023.
– IIIB-137 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Drill hole data shown in Table 12 -8 was used to construct the g eotechnical model.  The domains
include global hanging wall, immediate hanging wall, ore, immediate footwall and global footwall.
Table 12-8: Diamond Drill Holes Us ed to Construct Geotechnical Model
Hole Collars (RQD data) Hole Collars (Structural data)
DLK01-2 DIS602
DSM203-5 DIS604
DSM303-4 DIS628
DSM307-8 DIS631
DSM335 DIS642
DSM342-5 DSM203-5
LOL055 DSM285
LOL065-68 DSM303-4
LOL066 DSM307-8
LOL067 DSM342-5
LOL068 LOL015
LOL071-74 LOL020
LOL081 LOL055
LOL083 LOL065-68
LOL086 LOL071-74
LOL089 LOL072
LOL147  LOL073
 LOL074
 LOL081
 LOL083
 LOL086
 LOL089
 LOL147
Sources: SGPS
A statistical analysis was undertaken on logged rock mass classification factor (Q’) in each domain.
This analysis is summarised in Table 12-9.
Table 12-9: Q’ Statistical Analysis for Each Domain
Domain Minimum Q’25 Median Q’75 Maximum Mean Quality
Global Hanging wall 0.5  11.7  21.7  25. 0  142.0  24.1  fair
Immediate hanging wall 1.0  10.0 17.5 25.6 138. 8 24.5  fair to good
Ore 0.8  8.8  18.8  32.5  100.0  24.0  poor to good
Immediate foot wall 2.0  8.9 18.8 35.0 150. 0 30.0  poor to good
Global foot wall 0.9  29.0  67.0  137.5 270.0  77.3  good to very good
Sources: SGPS
– IIIB-138 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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AMC completed a geotechnical assessment to estimate stable stope spans and pillar dimensions for
the DSE UG deposit.  The limiting stope span was assessed to be  the hanging wall or crown of the
stope with a hydraulic radius (“HR”) limit of 5.7.
12.6 Underground Mining
The exploitation of the DSE UG as an underground gold mine, com mencing in 2023, was intended
to extend the life of the mine
12.6.1 Development System
The design consists of twin declines, both developed from what would be the upper benches of the
DSE OP.  One decline, with a portal at 205 m ASL, provides an a ccess to the eastern extent of the
deposit and the other, with a portal at 215 m ASL, to the western extent.  The design has divided the
mine into 4 distinct zones – SE, NE, SW and NW.  Isometric view  of concept design for long-hole
stoping with cemented paste backfill (“LHSB”) is shown in Figure 12-2.
Typical lateral development dimensions are shown in Table 12-10.  Vertical development dimensions
are likely to be in the 2.0 to 4.0 m diameter range depending on the location and purpose and subject
to positive stability assessment at those diameters.
Table 12-10: Lateral Development Profiles
Type Dimensions
Decline and Access  arch 5.5m wide x 5.8m high
Deposit Access – Level  arch 5.5m wide x 5.5m high
Return Air Drives, Escapeway Accesses, Ore Development square 5.0m wide x 5.0m high
Sources: SGPS
Figure 12-2: Isometric View of C oncept Design (LHSP, looking south)
Sources: SGPS
Since commencing production at the DSE UG, LXML has revised the development design. The new
design consists of only one decline, which continues developmen t from the upper benches of the
DSE OP. This decline, with a portal at 196 meters ASL, provides access for intake air, transportation
– IIIB-139 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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of materials, waste & ore and personnel. Additionally, there are fresh air and return air raises located
at approximately 220 meters ASL. The dimensions and development  rates for different types are
shown in Table 12-11 below. The plan view of this design for DS E UG is illustrated in the
Section11.5.2.
Table 12-11: Lateral Development Profiles
Type Dimension Rate
Decline arch 5.5m width x 6.0m height 60m/month
Electrical Drive arch 5.0m width x 6.0m height 60m/month
Fresh Air Drive arch 5.0m width x 5.0m height 60m/month
Fresh Air Raise circle 4.0m/diameter 60m/month
Level Access arch 5.5m width x 5.5m height 60m/month
Level Connection arch 5.5m width x 5.5m height 60m/month
Ore Access arch 5.0m width x 5.0m height 60m/month
Ore Drive arch 5.0m width x 5.0m height 60m/month
Return Air Drive arch 5.0m width x 5.0m height 60m/month
Return Air Raise circle 4.0m/diameter 60m/month
Sump square 5.0m width x 5.0m height 60m/month
Stockpile arch 5.0m width x 5.0m height 60m/month
Dia Drill Drive arch 5.0m width x 5.0m height 60m/month
Pumpstation arch 5.0m width x 5.0m height 60m/month
Slot Drive arch 5.0m width x 5.0m height 60m/month
Sources: LXML
12.6.2 Mining Methods
The proposed mining methods in the SGPS include long-hole stopi ng with cemented backfill
(“LHSB”), long-hole stoping with pillars (“LHSP”), and post pillar cut and fill (“PPCF”).
LHSB would be applied to areas where the deposit thickness is greater than 15 m.  Long-hole stopes
would be mined at suitable lengths then be filled and cured bef ore mining adjacent stopes. Waste
rock backfill could be used in the final secondary stope along strike.  This method would require
development at both the lower and upper levels of the stope to enable filling of the mined voids.  The
stope is 15 m wide and 45 m long after considering a hydraulic radius (“HR”) limit of 5.7.  Stope
height varies with thickness of mineralisation domain.  The mining recovery rate was assumed to be
90%.  The mining dilution rate was assumed to be 15%.
LHSP would be applied to areas where the deposit thickness is greater than 10 metres. Stopes would
be extracted by bottom level development and blind production up holes. Stopes would be left unfilled
as the rib and sill pillars allo w for ongoing stability.  The s tope is 20 m wide and 25 m long after
considering an HR limit of 5.7.  Stope height varies with thickness of mineralisation domain. The sill
pillar is 10.5 m wide.  The rib pillar is 11.5 m wide.  The min ing recovery rate was assumed to be
95%.  The mining dilution rate was assumed to be 10%.
– IIIB-140 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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    Final
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PPCF would be applied to all remaining inventory and would util ise waste rock backfill where the
deposit thickness is greater than 7 metres.  The bottom development style excavation would be taken
at 5 to 7m height depending on the deposit thickness. Subsequen t lifts would be taken in
approximately 4-metre slices depending on the initial drive height.  Drive width to pillar width ratio is
1:1. Opening length to pillar length (between drives) ratio is 6:5.  Number of lifts varies with thickness
of mineralisation domain.  The mining recovery rate was assumed  to be 77%.  The mining dilution
rate was assumed to be 5%.
Currently, LXML has revised the design based on LHSP method, wi th a mining recovery rate
designed to be 90% and mining dilution at 15%.
After reviewing the design, SRK noticed that the stope shape designed by LXML should be updated
based on the latest geological model. Consequently, SRK re-ran the Stope Optimizer (SO) based on
the input parameters provided by LXML to report the Ore Reserves, with more details referred to in
Section11.5.4.
12.6.3 Backfill
According to SPGS, the backfill st udy has not yet reached the p re-feasibility level. The decision on
whether to utilize pumping (if re ticulated) or truck hauls (if transported) has not been finalized. The
operating costs of paste backfill and the capital forecast  are derived from AMC benchmarks, set at
19.5 USD/m³ and 10.0 million USD, respectively.
Currently, LXML has prepared a report titled "Physical and Mechanical Properties and Proportioning
Test of Copper-Gold Tailings of LXML Sepon Mine." This prelimin ary report indicates the following
key points:
 Density Analysis: The report provides the density measurements of both historical and current
operational tailings.
 Fineness Classification: The fineness classification of both hi storical and current tailings has
been assessed.
 Tailings Classification: The re port includes a comparison betwe en full tailings and classified
tailings.
 Cemented Material Comparison: A comparative analysis of two typ es of cemented materials is
presented.
 Cement-Sand Ratio: The report discusses the cement-sand ratio used in the tailings.
 Material Consumption: An evaluation of material consumption is included in the findings.
Based on LXML's preliminary assumptions, the operating cost of paste backfill and the capital
forecast would be 15-16 USD/m³  and 6.0 million USD, respectivel y, where LXML may take
advantage of suitable budget-frie ndly options from China. Howev er, LXML has acknowledged that
these figures are still benchmarks, and more detailed studies b y a third party will be presented by
October 2024.
12.6.4 Mining Equipment
Underground mining equipment are shown in Table 12-12.
– IIIB-141 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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    Final
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Table 12-12: Owner’s Undergrou nd Mining Equipment Quantity
Type Model Quantity
Development Drills  Jumbo DD421 2
Production Drills   DRILL DL432, DRILL DL432i 2
Charge Rig  CHARMEC 2
Truck  TRUCK 740B 4
Loader R2900 3
Grader  CAT 14M GRADER 1
Service Truck Manitou MTX 1840, CAT 950 LOADER 2
Light Vehicles  12
Sources: LXML
12.6.5 Ventilation
A primary ventilation flow requirement was assumed to be 390 m³/s in the SGPS.
Primary ventilation will be established initially in the SE and the SW zones and once the NE and NW
shafts are constructed the primary ventilation fans would be moved from the southern shafts to the
northern shafts. The southern shafts would then become intakes. Figure 12-3 provides an overview
of the final primary ventilation network structure for the underground mine. Final exhaust shaft
dimensions (subject to positive stability assessment) are estim ated to be 3.5 m diameter with
estimated fan power on each of 250 kW.
Figure 12-3: Primary Ventilation Layout
Sources: SGPS
As mentioned in Section 11.5, LXML has revised the development design, resulting in changes to
the ventilation system. Figure 12-4 below illustrates the general layout of the updated ventilation.
– IIIB-142 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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    Final
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Figure 12-4: Revised Primary Ventilation Layout

Sources: LXML
Generally speaking, fresh air enters through the main decline a nd fresh air raise, subsequently
flowing into the fresh air drive or directly to the level acces s. A secondary fan is arranged to
pressurize the fresh air, directing it to the ore drive and then to the stope or development face end.
The exhaust air follows a reverse path, moving from the stope or development face end to the level
access, then to the return air drive, and finally to the return air raise.
Table 12-11 in Section 12.6.1 presents the design parameters for the ventilation drive and raise.
Figure 12-5 shows the secondary fan and vent tube arranged in the main decline to level access, as
observed during the underground visit on November 28, 2023.
Figure 12-5: Secondary Fan in Main Decline
Secondary Fan in Main Decline Vent tube in Main Decline
Sources: SRK
As a general comment on the underground visit, the areas were clean, reasonably well-ventilated.
– IIIB-143 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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SRK was also provided with the primary and secondary ventilation survey monthly records, as shown
in Figure 12-6 below. Normally, the survey is conducted on a monthly basis.
Figure 12-6: Primary Ventila tion Survey in January 2024
Sources: LXML
12.6.6 Conclusions and Recommendations
In SGPS, the proposed mining methods in the DSE UG include long -hole stoping with cemented
backfill (“LHSB”), long-hole stoping with pillars (“LHSP”), and post pillar cut and fill (“PPCA”).
Construction of the underground mine commenced in April 2022 at  DSE UG. As of 30 September
2024, SRK was provided with revised ventilation designs and underground designs by LXML.
SRK re-ran the stope optimizati on based on LHSB, as selected by  LXML, then applied modifying
factors and prepared the producti on schedule based on a review of LXML’s data. SRK notes that
LHSB has been widely practiced globally and is technically feasible.
SRK also noted that DSE UG would utilize cemented backfill to increase mining recovery, and more
comprehensive study is on-going. Cemented backfill is widely used in various mines, it would not be
a major risk which affecting Ore Reserves estimation
– IIIB-144 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


--- page 1422 ---
赤峰吉隆黃金礦業股份有限公司
Chifeng Jilong Gold Mining Co., Ltd.


--- page 1423 ---
Volume 3
Stock Code : 6693
(A joint stock company incorporated in the People’s Republic of China with limited liability)
赤峰吉隆黃金礦業股份有限公司
Chifeng Jilong Gold Mining Co., Ltd.
GLOBAL
OFFERING


--- page 1424 ---
This Prospectus is printed in three parts that together form the Prospectus. You
should read each part of the Prospectus in conjunction with the other parts
in order to understand the matters to which the Prospectus relates, including,
without limitation, the Hong Kong Public Offering and the International Offering.
Prospective investors should read each part of the Prospectus before making any
application in response to the Hong Kong Public Offering. We have adopted a
fully electronic application process for the Hong Kong Public Offering. We will
not provide printed copies of this Prospectus in relation to the Hong Kong Public
Offering. This  Prospectus  is  available  at  the  website  of  the  Stock  Exchange
at www.hkexnews.hk under the“HKEXnews > New Listings > New Listing
Information”section, and our website at cfgold.com. You may download and print
from these website addresses if you want a printed copy of this Prospectus.


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    Final
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13 Recovery Methods
13.1 Gold Processing Plant
13.1.1 Introduction
The Sepon Gold Plant started operations during 2002 as a conventional processing plant for treating
oxide ores by cyanide leaching. The plant was originally designed to process ore at 1.25 Mtpa. During
2006 the processing plant was expanded to achieve a processing throughput rate of 2.5 Mtpa. The
plant was placed in care and maintenance in December 2013 due t o unfavourable economic
conditions driven by low grades and low gold prices. During 2016, a Scoping Study evaluated the
option of re-allocating existing assets from both plants (Sepon Gold plant and Sepon Copper plant)
to significantly minimize the required capital expenditure. This option was considered in later studies,
as it was accepted that there were challenges for increasing the reserves for copper ores. The option
of pre-concentration by flotation followed by pressure oxidatio n (“POX”) was selected as “going-
forward case” taking advantage of current POX facilities.
During 2020, the Sepon Gold Project Study was completed by LXML , focused on optimising the
option evaluated during 2016, and maximising the utilisation of current assets. Since 2019, several
assets from the Sepon Copper plant have been allocated to processing primary gold ores, including
the flotation plant and the pressure oxidation circuit.
Currently, the plant has been expanded to process oxide ore and  primary/transition ores in parallel
mode. The overall plant capacity is 3.8 Mtpa, including the cap acity at 2.2 Mtpa to process
primary/transition ores and at 1.6 Mtpa to process oxide ore.
The oxidised ore is processed by carbon in leaching process (“CIL”) and the primary/transition ore is
processed by the "flotation - POX - CIL process". The final product is Gold Doré. Over the past three
years, 3.08 to 3.55 Mtpa ore was processed and 6.01 to 6.26 tpa of gold was produced with the gold
recovery of 55.1 to 65.2%.
The Sepon Gold Plant and Copper Plant are together in a complex. Figure 13-1 shows an aerial view
of the complex.
13.1.2 Production Process
After crushing and grinding, the oxidised ore enters the CIL sy stem. The primary and transitional
ores are crushed and ground before entering the flotation system to produce a flotation concentrate
and tailings, the tailings is discharged into the Flotation Tailing Storage Pit since cyanide free, while
the concentrate enters the CIL system after acidification and POX. The gold-bearing carbon from the
CIL systems is then sent to the el ution-electrowinning-smelting system to produce Gold Doré. The
leach residue from the CIL system is detoxified and discharged to the tailings storage facility (“TSF”).
The production process is simplified in Figure 13-2 and described as follow:
– IIIB-145 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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    Final
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Figure 13-1: Sepon Gold Plant and Copper Plant Complex

Source:LXML
Figure 13-2: Simplified Gold Recovering Flowchart

Source: SRK
 Oxide Ore Crushing and Grinding
– IIIB-146 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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    Final
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Oxide ore is fragmental and crushed by a roller crusher then GOX Mill (2,000 kW installed capacity).
The final sizing of the oxide milling circuit is P80=90~125 microns. The milled ore is then pumped to
TK01 and TK61 agitation tanks for cyanidation with air injection and lime addition. The slurry is then
pumped into the back end of the CIL circuit.
 Primary Ore Crushing and Grinding
A single toggle jaw crusher (Jacques ST47) will reduce the top size from 600 mm to 90 mm. Crushed
ore is stockpiled between the crushing and milling circuits. Th e crushed ore is then reclaimed by
apron feeders and fed into the SAG Mill (2,600 kW installed capacity) and Ball Mill (1,800 kW installed
capacity) circuit. The final sizing of the entire milling circuit is P80=53~65 microns.
 Primary Ore Flotation
The milled primary ore is then pumped to the flotation facility . The flotation plant includes two
Jameson cells and six 160 m3 mechanical rougher-scavenger cells with prior flash flotation cells. The
scavenger concentrate reports to the cleaning circuit which includes another Jameson cell and three
70 m 3 mechanical cells. The cleaner tails are recirculated to the ro ugher flotation cells. The
scavenger flotation tails report to a tails thickener (CCD4) fo r thickening purposes prior to being
pumped to the surge tank in CIL circuit or discharged to west T SF (“WTSF”) as well as to Khanong
Tailing Storage Pit since it is cyanide free tailing slurry.
 Concentrate Acidulation and Pressure Oxidation (POX)
The final flotation concentrate is dewatered by a concentrate thickener (CCD5). Concentrate at 40%
w/w density is then pumped into two agitation tanks (TK05 and T K06) for acidulation purposes.
Concentrate sulphuric acid and POX residue CCD (counter current decantation in thickeners) wash
solution provides the acid source for carbonate removal. The post acidulation slurry is dewatered by
thickener (CCD7). Concentrate at 40% w/w density is then pumped into the pre-heater vessel at the
Pressure Oxidation facility for increasing the temperature up to 90-95 °C. Heated concentrate slurry
reports to an agitation tank (TK135) for feeding the pressure oxidation facility, POX1 and POX2. The
heated concentrate slurry is then fed into the autoclave vessel , where the sulphides are oxidised
under aggressive leaching conditions (220 °C, 2,900 kPa total p ressure, 600 kPa oxygen
overpressure). Pyrite is completely oxidised to hematite and ba sic ferric sulphate. The pressure
oxidation vessel discharge reports to two tanks (TK101 and TK10 2) to start the hot cure process
(dissolution of basic ferric sulphate). Hot slurry is then pumped into another tanks (TK07 and TK08)
allowing enough residence time for complete basic ferric sulpha te dissolution. The slurry is then
washed through the front end of t he CCD train. Four thickeners have been allocated for washing
purposes (ALT1, CCD1, CCD2 and CC D3). The washed residue is then pumped from CCD3 to a
tank (TK133), where pH is increased up to 10 ahead of the CIL c ircuit. The slurry is then pumped
into the front end of the CIL plant at the Sepon gold plant.
A concentrate regrinding and cleaning facility is in constructi on for the concentrate upgrade and
carbonatites decreasing to save the sulphuric acid consumption of concentrate acidulation.
 Carbon in Leach (CIL), Elution and Gold Room
The CIL circuit is operated considering two activated carbon circuits. Four large CIL tanks (1,800 m3
each) and three small CIL tanks (1,000 m3 each) are allocated for primary ore CIL, while three small
CIL tanks (1,000 m 3 each) are allocated for oxide ore CIL. This carbon configurati on is based on
minimising the cross contaminati on of preg-robbing material fro m the ore. Gold is leached by
– IIIB-147 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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    Final
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conventional methods using sodium cyanide with air injection. Loaded carbon is transferred into the
stripping facility for elution purposes and final gold pouring within the gold room. A new elution circuit
is built in April 2022 to increase stripping capacity along with extension of gold room.
Mercury recovery system is included within the existing and new  elution circuit and gold room, for
regeneration kiln and electrowinning sludge drying. Mercury is recovered within liquid form, then
storage onsite for latter exportation outside of the processing facility.
 Cyanide Destruction and Neutralization
The overall CIL residue reports to the detoxification stage, where sodium metabisulphite and copper
sulphate are added for cyanide destruction. The final tails rep ort to the neutralisation stage for
increasing the pH up to 9 for final tailing disposal.
13.1.3 Production Performance
The overall gold recovery·ranges·from·55%·to·64%, as shown in Table 13-1.
Table 13-1: Sepon Gold Plant Historical Production Performance
Parameters Unit 2021 2022 2023 3Q2024
Oxide Ore
CIL Tonnes t 1,380,792 1,482,549 974,224 765,931
CIL Feed Grade - Au g/t 1.35 1.48 1.96 1.59
CIL Tails Grade g/t 0.45 0.46 0.93 0.74
CIL Gold Recovery % 66. 70 68.90 51.80 50.70
Gold Production kg 1,243 1,512 988 620
Primary Ore
Flotation Feed Tonnes t 1,892,68 8 2,070,955 2,110,735 1,589,337
Flotation Feed Grade g/t 4.60 3.74 3.55 3.30
Flotation Mass Pull % 27. 98 33.12 38.80 26.60
Flotation Concentrate Tonnes t 529,492 685,988 818,965 422,764
Concentrate Grade g/t 12.10 8.89 10.50 9.98
Flotation Recovery % 73. 60 78.80 85.40 80.40
CIL Feed Tonnes - POX Residue t  495,688 624,603 597,439 361,666
CIL Feed Grade - POX Residue g/t 12.79 9.87 10.75 11.62
CIL Tails Grade - POX Residue g/t 3.12 2.18 2.32 2.40
CIL Gold Recovery - POX Residue % 75.60 77.90 78.20 79.20
CIL Feed Tonnes - Flotation Tails t 243,020 - - -
CIL Feed Grade - Flotation Tails g/t 1.93 - - -
CIL Tails Grade - Flotation Tails g/t 1.78 - - -
CIL Gold Recovery - Flotation Tails % 8.00 - - -
Total Primary Gold Recovery % 54.66 61.28 67.01 63.47
Gold Production kg 4,759 4,746 5,021 3,329
Total Gold Produced kg 6,003 6,258 6,009 3,949
Overall Gold Recovery % 55.0 58.1 64.0 61.0

– IIIB-148 –
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13.1.4 Processing Facilities and Equipment
The main production facilities at Sepon Gold Plant include an oxide ore crushing and grinding system,
a primary ore crushing and grindi ng system, a primary ore flota tion system, a flotation concentrate
acidulation and POX -CCD system, a POX post-concentrate CIL sys tem, an oxide ore CIL system,
a gold-loaded carbon elution-elec trowinning-smelting-regeneration system, and auxiliary facilities
including an oxygen plant, a me tallurgical and assay laboratory , and a machine shop. The main
processing equipment are described in the above process description. Figure 13-3 shows part of the
gold facilities.
The cryogenic oxygen plant with a demonstrated capacity of 220 tonnes of oxygen per day supports
the pressure oxidation facility. An existing vacuum pressure sw ing adsorption (“VPSA’) oxygen has
a capacity of 50 tonnes of oxyg en per day and a new VPSA oxygen  plant was built in 2021 with a
demonstrated capacity of 160 tonnes of oxygen per day.
Figure 13-3: Facilities of Sepon Gold Plant

Source: SRK
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13.1.5 Consumable
The Sepon Gold Plant Consumable of December 2022 is shown in Ta ble 13-2, which is largely
representative of the future consumption levels of the plant.
Table 13-2: Sepon Gold Plant Consumable
Reagents Unit Consumption
Total Grinding Media kg/t dry ore milled 0.86
NaCN  kg/t dry ore milled 0.65
Hydrated lime  kg/t dry ore milled 12.8
Caustic Soda kg/t dry ore milled 0.85
SMBS kg/t dry ore milled 2.7
H2O2 kg/t dry ore milled 0.73
CuSO4  kg/t dry ore milled 0.38
Diesel kg/t dry primary ore milled 0.06
Sulfuric Acid kg/t dry primary ore milled
Xanthate  - SIAX and SIBX kg/t dry primary ore milled 1.8
Frother kg/t dry primary ore milled 0.07
Promoter - MBT kg/t dry primary ore milled 0.76
Fresh Water m3/t dry ore milled
Electricity kWh/t dry ore milled
13.1.6 Utilization of low-grade ore
There are plans to develop and utilize low-grade gold resources , but there is no technical studies,
neither optionality tests and (pre-) feasibility studies, or specific plans to conduct feasibility studies.
13.1.7 Conclusion and Recommendation
The Sepon Gold Processing Plant u ses the "flotation-POX-CIL" process for primary/transition ores
to produce Gold Doré and the CIL process for oxide ores to produce Gold Doré, which is believed to
be a suitable process by SRK.
In 2023, 2,111kt of primary ore was processed at a feed grade o f 3.55g/t with 85.4% gold flotation
recovery, 78.2% POX-CIL recovery. 5.021kg gold was produced fro m primary ore, the overall gold
recovery is 67%.
In 2023, 974kt of oxide ore was processed at a feed grade of 1.96g/t with 51.8% gold recovery. The
lower gold recovery rate is considered by SRK to be mainly due to the multiple ore types and the
inherent refractory of the ore, while the reasons for the processing and operating parameters are of
secondary importance. Total gold production is 6 tons from oxide an primary ores with overall gold
recovery of 64%.
The primary and oxide ores will continue to be processed on exi sting facilities and the flowsheet is
continuously upgrading. SRK proposes to forecast future product ion at an overall recovery of 65%.
There are plans to exploit the low-grade gold resource, but no technical studies have been carried
out yet in relation to this plan. It is recommended that verification and associated technical studies,
including metallurgical tests and feasibility studies, be conducted on the low-grade resource.
– IIIB-150 –
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13.2 Copper Processing Plant
13.2.1 Introduction
Copper processing is conducted at two different locations within the Sepon operation, utilising
components of the former copper process plant together with the  more recently constructed Heap
Leach Operation. Each facility runs parallel to the other with the heap leach operation lying northeast
of the copper processing plant at the mining ROM pad area.  Fin al metal production occurs within
the processing plant area.  Previous copper operations were transitioned from July 2020 to the new
gold primary circuit which included transfer of the former copper mill, pressure autoclaves, & leaching
tanks. Remaining processing assets (which have not been utilise d in the primary gold conversion)
will be utilised to treat residual  low-grade copper ore stockpi les on the ROM. The former copper
process plant assets retained for copper processing include the Scrubber, cold acid leach, CCD, and
solvent extraction & electrowinning (SX/EW).
Figure 13-1 of Section 13.1 shows an aerial view of the complex of Gold Plant and Copper Plant.
13.2.2 Production Flowsheet
A typical hydrometallurgical process includes 3 circles as shown in Figure 13-4.
Figure 13-4: Schematic Diagram for Copper Hydrometallurgical Re covery
Solvent ExtractionLeaching Back Extraction
 Electro-winning
Copper
Ore
Electrolytic
Copper
Pregnant
Leaching Solution
Loaded
Organic
Pregnant
Electrolyte
Extraction
Raffinate
Stripped
Organic
Lean
Electrolyte

The Sepon copper production flowsheet is a typical hydrometallu rgical process, including agitation
leaching and heap leaching operations, and the final product is cathode copper. Simplified flow chart
is presented in Figure 13-5, descripts as follows:
– IIIB-151 –
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Figure 13-5: Simplified Copper Metallurgical Flow Chart
CCD
Back-extraction
Electrowinning
Cathode Copper
Solvent Extraction


Extraction Raffinate
Pregnant Leach Solution
Scrubber Wasing
Crushing
Milling
Heap Leaching
Agitation Leaching
Over Flow
Neutralization
Tailings Storage Facilities
Over Size
Extraction Raffinate
Run-of-Mine

Source: SRK
 Crushing and Scrubbing
Low grade oxide and mixed oxide & sulfide copper ores are store d on the ROM pad. The ROM is
then crushed by an impact crusher. The scrubber circuit washes the crushed ore with acidic process
solution and then screens out the larger particles to produce a leach slurry that is sent to leach tank.
 Cold Acid Leach and CCD
Concentrated sulphuric acid is added to leach tank to dissolve the copper into solution. The leach
slurry is then transferred to CCD train #2. The slurry is thick ened in each of the atmospheric leach
thickener (ALT2).  Thickener overflow, termed pregnant leach solution (PLS), is pumped to a clarifier,
and flows from there, by gravity, to the PLS pond.  Underflow s treams from the PLS clarifier and
atmospheric leach thickeners are pumped to the first CCD thicke ner. CCD train comprises six
thickeners arranged in series. The purpose of the CCD circuits is to wash copper, acid and iron from
the atmospheric leach thickener underflow stream.  In order to achieve this, solid underflow and clear
overflow streams move in counter-current direction through each CCD train.  The streams are mixed
ahead of each thickener, in an agitated mix tank, to ensure efficient washing.
Flocculant is added to each thickener according to the settling characteristics of the ore blend.  The
flocculation and resulting settling rate is sensitive to thicke ner feed density.  Internal dilution in the
Scrubber Washing
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feed well is used to control the feed density and the flocculated solids are injected into the feed well
to improve settling rates.
Washing of the solid material in the first three CCD thickeners of each train is achieved by contacting
the solid underflow from the atmospheric leach thickener with copper raffinate from solvent extraction,
which enters the circuit in the second CCD mix tank.  The wash ratio in this section of the CCD circuit
is approximately 4:1. Due to the high levels of iron and acid i n the copper raffinate, only copper is
washed from the solid underflow in the first two CCD thickeners.
Overflow from each of the first CCD thickeners is stored in a s urge tank.  CCD overflow is returned
to milling and atmospheric leaching, via the heat recovery exch angers and atmospheric leach pre-
heater in Pressure Oxidation.
Underflow from each of the third CCD thickeners is pumped throu gh the next three CCD stages of
each train where it is contacted with dilution water from the flotation circuit, to further recover copper
as well as iron and acid.  The wash ratio in the next three thi ckeners is approximately 1:1. As the
wash water reports with raffinate to the CCD overflow tank, the amount of water used is set to match
the makeup water requirements of the overall circuit.  The plan t water balance limits the wash
efficiency achieved in this section of the CCD circuit.
The final thickener in the CCD circuit is used to thicken the slurry, the returned underflow is pumped
to Neutralisation.  Process water is added to the dilution tank to make-up for the volume sent forward
as wash water.
 Solvent Extraction
The solvent extraction plant consists of one train having three  extraction mixer-settlers operating in
series, two stripping mixer-settlers, one organic washing mixer -settler and a loaded organic tank.
Each mixer-settler consists of one Dispersion Overflow Pump (“DOP”) Unit, two Spirok mixing units
and a settler.
The clarified and cooled PLS solution containing copper in solu tion is pumped from the PLS pond
through two pipelines into the SX area into E1 DOP unit. The PL S flow rate is controlled with feed
pump VFD.
In the E1 stage DOP, the PLS solution is mixed with semi-loaded organic coming from the E2 mixer-
settler and a part of the PLS copper content is extracted into the organic phase by using copper
selective organic reagent mixed with kerosene type diluent.
The formed dispersion flows through Spirok mixer units and via an uptake channel into the settler,
where the dispersion flow is distributed across the full width of the settler by using a distributor fence.
The organic and aqueous phases are separated by aid of set of picket fences. Because the organic
phase has a lower density than the aqueous phase, it floats on top of the aqueous solution.
The extraction mixer-settlers are designed to operate with orga nic to aqueous phase ratio of close
1:1. The global O/A ratio is anyhow 1,7:1,0, thus the extractio n mixer-settlers are furnished with
aqueous inner circulations taken from the settler bulk.
There are two launder compartments at the discharge end of each settler. The copper loaded organic
overflows into the first compartment and the aqueous phase flows under the organic launder into the
– IIIB-153 –
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aqueous launder through pipes, which are furnished with bellows  to control solution levels in the
settler.
The aqueous phase from the E1 settler flows via an outlet box to E2 DOP unit and the copper loaded
organic solution flows by gravity into a loaded organic tank. In the E2 DOP unit, the aqueous solution
from the E1 stage is mixed with partly loaded organic solution from the E3 stage. The formed
dispersion flows through the mixing units into the settler, where the phases are again separated.
The aqueous phase from the E2 stage continues into the E3 mixer -settler where it contacts with
stripped organic coming from t he S2 stage. About 88% to 95% of the PLS copper content is now
transferred from the aqueous phase into the organic phase. The extraction recovery varies
depending on the PLS acidity and copper content. The raffinate copper solution flows from the E3
stage by gravity into the raffinate pond.
The loaded organic tank is furnished with scrub water circulati on to enhance impurity control. The
PLS solution contains impurities like iron and manganese, which  are harmful for the electrowinning
process. Transfer of these impurities into the copper electrolyte is minimized with aid of scrubbing in
the loaded organic tank and using a washing mixer-settler. The scrub water in the loaded organic
tank is circulated into the organic outlet of the E1 stage with centrifugal pumps. Acidic fresh water is
taken into the circulation and corresponding amount is bled out  into the aqueous outlet of the E2
stage.
The pre-scrubbed loaded organic is pumped by using VFD controll ed centrifugal pump from the
loaded organic tank through LO pump tank into the W stage DOP unit, where it is mixed with acidic
water, coming from electrolyte filter backwashing. The objectiv e of the W stage is to wash out and
dilute impurities, which have been transferred in organic phase  as chemical and aqueous
entrainment. Used wash water flows to the E2 DOP. The W mixer-settler is designed to operate with
organic to aqueous ratio of close 1:1. However the advance rati o is about 45:1, thus the washing
mixer-settler is furnished with aqueous inner circulations taken from the settler bulk.
The washed loaded organic flows from the W stage to the first stripping stage S1, where it’s contacted
with semi-rich electrolyte solution from the second S2 mixer-settler. Copper is transferred back into
the aqueous phase by aid of acidity difference between the phas es. The rich electrolyte containing
close to 50 g/l copper flows from the S1 stage by gravity to the rich electrolyte after settler, which is
located at the tank farm. Partially stripped organic solution c ontinues to the S2 stage, where it’s
mixed with lean electrolyte solution pumped from the electrolyte circulation tank, which is located at
the tank farm. The lean electrolyte contains 33-35 g/l copper and 180 g/l sulphuric acid.
The stripping mixer-settlers are also designed to operate with organic to aqueous phase ratio of close
1:1. The global O/A ratio is about  2:1, thus the stripping mixe r-settlers are furnished with aqueous
inner circulations taken from the settler bulk. The stripped organic returns from the S2 stage back to
the E3 stage.
 Electrowinning
Copper is recovered from the electrolyte solution by connecting  direct current between the lead
anodes and the stainless steel cat hodes. The electrowinning lay out is based on a double aisle
configuration with 2 rows of cells.  Two separate electrical an d electrolyte circulation circuits are
formed with 142 and 24 cells respectively. The electric current  is fed to the electrolytic cells by two
60 kA transformer-rectifier. The bus bar system connects each g roup of cells together and to their
– IIIB-154 –
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respective rectifier. During this process copper is deposited a t the stainless steel cathodes and
oxygen is liberated at the anodes.
The EW feed electrolyte is pumped from the electrolyte circulat ion tank into the electrolytic cells.
Copper content of the electrolyte is 35 to 36 g/l and acid cont ent 180 g/l. Electrolyte temperature is
maintained at 45 to 50 °C. The change of the copper concentration in the electrolyte is 1.9 to 2.3 g/l.
The electrolyte from the cells flows by gravity back to the circulation tank. Electrolyte outlet from the
cells is equipped with screen to capture PP balls.
The Electrowinning process produces high purity 99.999% copper cathode metal. The cathodes are
allowed to grow for certain days after which they are pulled fr om the cells. An operator controls the
crane by using remote control. The crane bale is fine positioned to a cell by its positioning cones that
meet the corresponding holes integrated into the cell, pulls ev ery second cathode at a time, and
during the pulling sprays the cathodes with water in order to rinse off the electrolyte.
Pulled cathodes are transferred from the cell to a cathode wash dip tank. Cathodes are washed and
transferred to the receiving conveyor of the stripping machine. The Cathodes are again sprayed with
hot water in a spray box fitted to the conveyor to remove any final traces of electrolyte. The Cathodes
are then automatically stripped in the Cathode Stripping Machine. Stripped blanks are lifted from the
discharge conveyor of the stripping machine and transferred bac k to the cells. The crane bale is
equipped with cathode aligning combs that ensure that the cathodes are inserted safely between the
anodes.
In the stripping machine, the stripped copper deposits move dow n and turn into horizontal position.
The stacking unit automatically  collects the deposits into stac ks, which are discharged from the
stripping machine by the stack discharge conveyor. The stacks a re removed by a fork-lift truck for
subsequent manual sampling station, weighing unit and strapping unit.
 Neutralisation
Thickened CCD tailings are pumped to neutralisation tanks.  The  tanks are arranged in a cascade
such that pulp from each tank overflows to the next tank in the sequence.  Upcomers are fitted to the
overflow of each tank to limit short-circuiting and ensure that no build-up of large particulate material
occurs.  Bypass launders are provided for each tank in the train to allow individual tanks to be isolated
and maintained while the rest remain online.
Spargers are installed in the first two tanks to provide oxygen  for ferrous ion oxidation to maximize
iron precipitation in these tanks.  Air is supplied to these tanks from the atmospheric leach blowers.
Limestone slurry is metered into the first three tanks and lime  into the final two tanks, both from
circulating ring mains.  Water is added to the final tank to reduce the solid density to 35% to control
slurry viscosity.
Gold plant tailings enter the second neutralisation tank and th e combined tailings stream overflows
into a pump hopper.  The combined tailings are pumped to the we stern tailings storage facility by
two sets of tailings pumps.
 Heap Leach
The heap leach copper processing plant was constructed in 2020 using a blend of primary copper
ores, copper process scats and scrubber oversize. Ore has been stacked on 6 HDPE lined pads into
heaps up to 12 metres high. The heaps are covered with plastic irrigation hosing to drip acidic
– IIIB-155 –
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process solution from the copper process plant onto the top of the heap. The solution passes through
the heap dissolving copper and is collected in HDPE lined ponds .  Three (HDPE lined) ponds were
also constructed in 2020 at the heap leach process plant to man age solution being fed to and from
the copper heap leach pads. Pregnant Leach Solution from heap l each is transferred under gravity
flow to the SX/EW PLS Pond to mix with scrubber leach solution prior to SX/EW.
13.2.3 Production Performance
The production process was mo dified in 2020 and 2021, with ore crushing followed by washing,
coarse-grained fraction heap leaching, and fine-grained fraction grinding followed by stirred leaching.
After 2020, heap leaching and stirred leaching simultaneously produced leach rich liquor (PLS) and
copper cathode by extraction/electrolysis (SX/EW). The production performance is shown in Table
13-3. Stir leaching, with the decrease in leach grade, has a significant reduction in copper recovery,
with a leach grade of 1.43% and a copper recovery of 57.2% in 2022. The integrated recovery from
heap leaching for 2020,2021 and 2022 is 76.2%, including the copper brought back to the heap leach
by the extraction poor solution. The integrated recovery is 78.4% in 2021, which suffered a reduction
to 61.7% in 2022 due to the decrease in ore grade. SRK believes  the recovery rate will gradually
increase for the long heap leach cycle.
Table 13-3: Sepon Copper Plant Hi storical Production Performance
Items Unit 2021 2022 2023 3Q2024
Agitation Leaching
Milling feed tonnes t 255,074 772,052 1,105,175 843,337
Milling feed grade-Cu % 2.47 1.43 1.02 0.99
Cu metal feed to agitation leach t 5,673 10,308 11,273 8,313
Copper produced from agitation leach t 4,052 5,891 6,136 3,446
Agitation leach recovery % 71.22 57.15 54.43 41.45
Heap Leaching
Stacked tonnes2 t 236,988 40,800 188,585 214,711
stacked copper grade % 0.70 0.80 0.99 0.67
Cu metal stacked t 1,659 326 1,867 1,438
Copper produced from heap leach t 1,696 675 383 184
Heap leach recovery1 % 68.95 76.23 63.30 65.58
Total ore processed t 492,06 2 812,852 1,293,760 1,058,048
Copper grade of ROM % 1.49 1.31 1.02 0.92
Cu metal feed t 7,332 10,635 13,140 9,751
Total copper production-plated t 3,345 6,566 6,548 3,856
Total copper production-stripped t 5,748 6,565 6,519 3,462
Overall copper recovery % 78.40 61.73 49.61 41.64
Notes:
1 Heap leach recovery is calculated based on the total amount of copper stacked and produced.
2 The oversize ore in 2024 has not heap leached.
– IIIB-156 –
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13.2.4 Metallurgical  Facilities
The main metallurgical facilitie s at Sepon Copper Plant include  a crushing and scrubber washing
system, a grinding system, a heap leaching system, an agitation leaching and CCD system, a SX/EW
system, a residue neutralization system. Figure 13-6 shows main workshops of the copper plant.
Figure 13-6: Workshops of Copper Plant

Source: SRK site visit
13.2.5 Consumable
Table 13-4 lists the consumptions of the agitation leaching plant.
Table 13-4: Sepon Copper Plant Consumable
Reagents Unit Consumption
Grinding Media (Steel Balls) kg/t dry ore milled 0.33
Sulphuric Acid  kg/t dry ore leached 85.00
Flocculant Addition  g/t dry ore milled 212
Lime kg/t dry ore milled 18.58
Limestone kg/t dry ore milled 86.80
– IIIB-157 –
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Fresh Water m3/t dry ore leached
Electricity kWh/t dry ore leached
13.2.6  Utilization of Low-Grade Ore
Total copper potential for Sepon including tailings and stockpi les estimated is as 138Mt @ 0.68%
grade for 940kt of contained copper. The resources for potential copper production is as follows:
 Tailings for leach potential 24Mt @ 0.37% for 88kt of contained copper.
 Tailings for flotation potential 1.45Mt @ 0.4% for 6kt of contained copper.
 Copper stockpile estimated as 4.65Mt @1.04% for 48kt contained copper.
 More than 85% contained copper from Thengkham (58%) and Khanong  (27%) ,total primary
copper potential estimated as 95Mt @ 0.57% for 538kt of contained copper.
There are plans to utilize the aforementioned low-grade resourc es by treating low-grade primary
copper ore using a flotation process to produce a saleable copper concentrate. The flotation tests on
primary copper ores confirmed satisfied results, the copper rec overy is over 80% with a saleable
grade of above 18%. A pre-feasibility study level Thengkham Primary Copper Proof of Concept has
been finished in October 2023 (“POC”). The POC designed the pri mary copper plant adopts
“crushing-milling-rougher flotat ion-regrinding-cleaning” proces s to produce saleable copper
concentrate with gold and silver credit. The designed capacity of the flotation plant is 7.5 Mtpa with
copper recovery no less than 80%. Copper concentrate is expected within 18% to 24%.
There are two options of the plant development scheme:
 Option 1 - Building an entire new processing facility at Thengkham
 Option 2 - Upgrading the existing processing plant
As a result of preliminary trade off study, the Option 2 is the preferred scheme, but the NPV is
negative. The economic indicators for the option of upgrading t he existing plant provide enough
resolution for classifying this project within negative/margina l project minimum blue-sky potential.
This option will breakeven at a copper recovery of 87%, or at a copper price of 9,119 USD/t copper.
A minimum inventory of 137 Mt is required for breaking-even. A strong copper price outlook would
support additional studies for this option.
The final recommendation from this study is to proceed with the update of the Resource model as a
priority. The model update should be mainly focused on the prim ary mineralisation. The LXML
Exploration team has already included additional drilling in this region for the 2024 plan. The upside
potential for the Upgrading the existing processing plant case warrants this additional drilling and
model update. Once the Resource model is updated, a detailed feasibility study is recommended.
13.2.7 Conclusion and Recommendation
Hydrometallurgy is a reliable process technology for treating c opper oxide ores. The operation of
Sepon copper mine for many years has shown that the copper recovery rate is greatly influenced by
the leaching grade during the "Stirred Leaching-CCD-SX-EW" process. The leach grade is reduced
from 2.71% in 2020 to 1.43% in 2022, and the copper recovery rate is reduced from 83.3% to 57.2%.
– IIIB-158 –
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Heap leaching is a low-cost wet copper extraction process that can consume excess extractive
solution. The combination of stirred leaching and heap leaching  can better maintain the process
water balance and also reduce the cost to treat lower grade ore . As a reference, the combined
recovery of stirred leaching and heap is 61.7% in 2022. A recovery rate of 65% is recommended by
SRK as a parameter for subsequent deposit evaluation and econom ic analysis, taking into account
the long heap leach cycle.
The primary copper ores are amenable to flotation process. Labo ratory tests results in the copper
recovery over 80% in the concentrate with copper grade ranging 18% to 24%. A Proof of Concept
study shows the NPV is negative. A detailed feasibility study is recommended to be conducted once
the Resource Model is updated and the copper price raises to above USD9,119 per tonne.

– IIIB-159 –
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14 Project Infrastructure
14.1 Tailings Storage Facilities
There are two Tailings Storage Facilities (“TSFs”) at the Sepon  copper mine and gold mine, TSF1
and the western TSF (“WTSF”). The blended tailings from Copper Plant and Gold Plant are deposited
in the TSFs. The storage capacity of TSF1 has been exhausted, and WTSF is in its final raising stage
(stage 8). A WTSF EXTENSION DETAILED DESIGN has been compiled by Knight Piesold Pty Ltd
in August 2022, adding an extra of 44 Mt (37 Mm 3@1.2t/m3) storage capacity serving 8 years from
2023 at approximate rate 5.52Mt per year.
14.1.1 TSF1
TSF1 is located approximately 1 km southeast of the Sepon processing plant. TSF1 was constructed
in 2002. Gold tailings were deposited exclusively into the faci lity until March 2005 when both gold
and copper tailings were co-disposed. Construction comprised si x downstream stages undertaken
between 2002 and 2008 to a crest level of RL 287.2 m with a sto rage capacity of 16 Mt. A final
upstream lift was added in 2012.
TSF1 has a main embankment. The dam figures a drainage system constructed at upstream toe of
the embankment designed to pump underdrainage from the tailings  mass directly back into the
supernatant pond, although this underdrainage system is current ly not in use. TSF1 also has a
southern and a northern saddle dam that both comprise low perme ability homogenous fill. The
maximum height of the main embankment is at RL 287 m, approxima tely 72 m. The saddle dams
are approximately 5 m high. The crest length of the main embankment is approximately 850 m. The
saddle dams range from 40 to 80 m in length.
The tailings beach level based on the September 2018 survey is RL 285 m. A well-developed beach
is formed against the main embankment and the saddle dams. Ther e has been minimal tailings
discharge since 2018, so the 13.9 Mm3 of tailings stored in TSF1 calculated by LXML in December
2017 is assumed to be still applicable.
The current spillway is located near the northern saddle dam, t hrough the western abutment. The
current spillway discharges via a rock-lined chute to a deep valley below the northern saddle dam.
A seepage collection system is located at the downstream toe of  the main embankment, returning
seepage back to the TSF or directly to the process plant.
Ponded water is removed from the dam by a barge-mounted pump de cant system and associated
HDPE decant return pipeline, pumping directly to the process ponds at the plant site.
Tailings were delivered to the dam  via a HDPE tailings delivery  pipeline located within a concrete
culvert for the entire distance between the plant and TSF1. An emergency dump pocket / catch dam
is located at a low point along the pipeline alignment (adjacen t to Hinsom Creek). The tailings
distribution pipeline had 4 operating spigots and droppers located across almost the full length of the
embankment. Currently, tailings deposition is not taking place, but LXML is considering the possibility
of reintroducing limited discharge as part of the conversion to gold tailings.
– IIIB-160 –
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14.1.2 WTSF
The WTSF is situated approximately 10 km southwest of the existing plant site. The WTSF has been
operational since January 2008, sto ring tailings generated from the gold and copper processing
plants. The copper processing plant has a current throughput rate of 2.2 Mtpa but was scheduled to
be closed in 2020. The gold processing plant has been in care a nd maintenance since 2013 but is
currently being refurbished and expected to recommence processing this year.
Stage 8 construction is ongoing, and the raise is being complet ed in stages. The crest was initially
raised to RL 307 m and now construction of the downstream portion of the raise is underway.
The principal components of the WTSF comprise the following elements:
 Main Embankment.
 West Embankment: A major embankment located at the western side of the WTSF.
 Northern Saddle Dams: A series of saddle dams along the northern side of the WTSF.
 Spillway: The spillway is located at one of the northern saddle  dams and is an overflow levee
with erosion protection provided on the surface of the levee.
 Decant Facility: The decant facility is a pump barge located on the northern side of the WTSF.
The Main Embankment has a maximum height of just over 60 m with  the western embankment at
approximately 34 m and the saddle dams ranging in height up to approximately 7 m. The Stage 8
construction is reducing batter slopes on the downstream faces of both embankments with slopes of
1V:3.3H and 7 m wide benches at 10 m heights giving an overall slope of 1V:4H.
The crest length of the main embankment is approximately 2.4 km  with the western embankment
being approximately 300 m.
In February 2021, LXML conducted an optional study examining th e potential to expand the WTSF
to the west, north and southeast as part of ongoing extensions to the life of mine plan. Following this
study, an expansion to the southeast was selected based on ulti mate capacity, geological and
embankment fill efficiency assessments. A tailings storage capacity of 17.4 Mt was required for the
reserves nominated in the PFS, with an increased storage config uration up to 44 Mt developed for
the final design. On the basis of LXML’s study, Knight Piesold completed the WTSF extension design
in August 2022. The extension capacity was designed to accommod ate 44 Mt (37 Mm 3 at 1.2t/m3)
tailings which is scheduled to be deposited over 8 years, start ing from year 2023 at annual volume
of 5.52 Mt. Figure 14-1 is the WT SF and its extension drown by Knight Piesold in the  WTSF
Extension Design.
– IIIB-161 –
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Figure 14-1: WTSF and Extension

14.2 External Transportation
Sepon site is located in central Eastern Laos, 235 km East North East of Savannakhet, 45 km North
of Ban Nabo and 290 km from Da Nang in Vietnam, and centred at Co-ordinates  17° (1875000nM)
N and 106° (607000nM) E with an Elevation of 260m above sea lev el Figure 14-2). Table 14-1 lists
different access methods to the project area.
Figure 14-2: Location and Access to Sepon Project

– IIIB-162 –
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Table 14-1: Accesses to Sepon Project
Road Access From Bangkok via Savannakhet (possibly routes 2, 202,212), 9 + 28A to Ban Nabo
Air Access
 Regular chartered flights operated by Lao Skyway from Wattay Airport domestic
terminal in Vientiane, with some flights via Savannakhet Airport.
 Helipad on site
Sea Access
 Via Bangkok or Laem Chebang
 Logistics of supply lines to the site will be established to suit particular packages.
Most likely access will be via Bangkok where   accumulation of goods will take
place for road shipment to site.
 Via Vietnam
14.3 Other Facilities in  the Sepon Mine site
Historically, Sepon Mine has about 20 years of production, and various facilities were well developed.
14.3.1 Industrial Sites
There are more than 20 open-pits associated with the waste dump sites and ore temporary storage
sites near the pits.  Now only a few of the open-pits are in op eration, and some old pits have been
used for waste dump sites.
There is an industrial site hosting ore processing plant and smelter, with ore dump and blending sites.
The whole mine site was separated from local communities with i ts own traffic control system of
haulage roads and various internal roads.
14.3.2 Camps
There are two camps within the mine site.  One camp can host ab out 700 people for expats and
technical personnel, as well as visitors; the other can host about 2,000 people for Lao nationals who
work in the mine.  Each camp has its own catering and laundry services, as well as being equipped
with various sport f acilities.  Shuttle buse s operate from 5:00 am to 7:00pm in the morning and
evening between work sites and camps.
14.3.3 Airstrip
There is an airport within the mine site, only minutes away from the head office.  Charter flights are
available daily between Vientiane and the Sepon in weekdays.
– IIIB-163 –
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15 Market Studies and Contracts
The final products from the Sepon project are cathode copper pl ates and gold bars.  SRK was
provided with copper sales agreement and gold refining agreement.
15.1 Copper Sales Contract
The copper sales agreement was signed on 14 January 2022 betwee n LXML (“the seller”) and
Trafigura Pte Ltd, of Singapore (“the buyer”). The agreement sets that:
“The price shall be the LME Settlement price for Copper as quot ed on the London Metal Exchange
averaged over the market days of the quotational period (The quotational period shall be the month
after the month of delivery (M+1) plus respective premium and minus any applicable discount below:
 Premium: The Codelco CIF Taiwan cathode benchmark for the respective year of delivery.
 In case the product does not meet the LME specifications, the following discounts shall be
applicable:
– OG 1 (max Pb 10ppm and max S 20ppm): USD 50.00 (US Dollar fifty) per Metric Tonne.
– OG 2 (max Pb 30ppm and max S 30ppm): USD 80.00 (US Dollar eighty) per Metric Tonne.
– OG 3 (max Pb 50ppm and max S 50ppm): USD 200.00 (US Dollar two hundred) per Metric
Tonne.
 Freight Netback:
– The price shall be further adjusted to EXW basis by an applicab le freight netback from CIF
CY Taiwan. Such freight netbacks shall be negotiated in good fa ith and mutually agreed
between the parties for every six (6) month delivery period dur ing the months of December
and June prior to the scheduled delivery period. For 2022, Sell er shall bear 1/3 of actual
freight costs but no more than US Dollar 15 per Metric Tonne fo r cathodes shipped to
countries other than Thailand.”
15.2 Gold Refining Contract
A refining agreement was signed between ABC Refinery (Australia) Pty Ltd and LXML on 10 August
2020.  The agreement defines that there is no charge on melt or assay of gold and silver Dorè, and
refining charge is agreed as USD0.075/gross oz, with a retentio n (metal return) of 0.015% Au and
0.5% Ag.
– IIIB-164 –
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16 Environmental Studies, Permitting, and Social or
Community Impact
16.1 Environmental and Social Review Objectives
The objective of this environmental and social review is to identify and/or verify the existing and
potential environmental and social  liabilities and risks and as sess any associated proposed
remediation measures for the dev elopment and operation of the S epon Project. During SRK’s site
visit in May 2024, the project was in commercial operation incl uding multiple open pit mining, gold
and copper ore processing, tailings storage facilities and waste rock dumps.
16.2 Environmental and Social Review Process, Scope and Standar ds
The process for the environmental and social preliminary review for the Project comprised a review
of provided project environmental and social management documen tation combined with site visit
observation against relevant criteria within:
 Laos national environmental regulatory requirements; and
 World Bank/International Finance Corporation (“IFC”) environmen tal and social standards and
guidelines and internationally recognised environmental management practices.
16.3 Status of Environmental and Social Approvals
SRK was provided with the following Environmental and Social Impact Assessment (“ESIA”) reports
for the Project, where the associated ESIA report approvals wer e issued by the Ministry of Natural
Resources and Environment (“MoNRE”):
 NSR Environmental Consultants Pt y Ltd and Earth Systems Lao (Se ptember 2001), Sepon
Project Environmental and Social Impact Assessment Report, English Version;
 NSR Environmental Consultants Pt y Ltd and Earth Systems Lao (No vember 2002), Sepon
Project Environmental and Social Impact Assessment Addendum Report, English Version;
 Enesar Consulting Pty Ltd (April 2004), Sepon Project Gold Expansion Environmental and Social
Impact Assessment Report, English Version;
 Coffey (January 2008), Sepon Gold and Copper Operations GPDA Go ld Oxide Project
Environmental and Social Impact Assessment Addendum Report, English Version;
 Coffey (July 2009), Sepon Copper Expansion Project Environmenta l and Social Impact
Assessment Addendum Report, English Version;
 Sustainable Solutions Global and Earth Systems Lao (2020), Sepo n Gold Expansion Project
Environmental and Social Impact Assessment Report, English Version; and
 Earth Systems Lao (October 2022), Sepon Gold Expansion Project Stage II Environmental and
Social Impact Assessment Report, English Version.
– IIIB-165 –
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16.4 Environmental Compliance and Conformance
Please note that the following are the Laos environmental laws and regulations which the Company
needs to comply with:
 The 9th Five-Year National Social-Economic Development Plan (2021 - 2025);
 National Environment Strategy to 2020 (2004);
 National Biodiversity Strategy and Action Plan for 2016-2025 (2016);
 Strategic Framework for National Sustainable Development Strate gy for Lao People's
Democratic Republic (“PDR”) (2008);
 National Environment Action Plan (“NEAP”);
 National Adaptation Programme of Action on Climate Change (2009); and
 MoNRE Vision toward 2030 and National Resources and Environment  Strategy, 2016-2025
(2015).
Further than these strategies and  action plans, Lao Government has also formulated draft policies
and strategic frameworks relating to environment such as the Dr aft Strategy and Action Plan for
Water Resources Management.
SRK notes that these ESIA reports mentioned above have been com piled in accordance with
relevant Laos environmental laws and regulations, as well as Wo uld Bank/IFC environmental and
social standards and guidelines and internationally recognised environmental management
practices. SRK has reviewed thes e ESIA reports with the associa ted approvals and conducted an
environmental site visit against recognized international indus try environmental management
standards, guidelines and practices. In the following sections, SRK provides comments in respect to
the Project’s environmental management measures.
16.4.1 Water Aspects
Three classes of water are used in and around the mining, process plants and accommodation camp
areas including raw water, process water and potable water.
Raw (untreated) water is pumped from the Nam Kok River through a water clarifier to a series of
tanks to the east of the gold plant. Water is used to meet domestic and process water requirements.
The process water is a combination of raw water from the Nam Kok River and recycled TSF decant
water. Potable water for the offices and Padan Camp is supplied via a feed from the reverse osmosis
plant, located at the Gold Plant, and an additional drinking wa ter treatment plant for potable water
supply at Padan camp. Potable water for Hinsom Camp is provided via a dedicated water treatment
plant located adjacent to the camp supplied by a groundwater bore.
Water used at the site and surface water runoff has the potenti al to be impacted by process
chemicals, hydrocarbons, eroded sediments, and Acid Rock Draina ge (“ARD”). Effective water
management is fundamental to minimising potential adverse effects to the downstream environment
and community water and aquatic resource users.
A water management system is maintained at Sepon and comprises water management
infrastructure such as diversion drains, settlement ponds, envi ronmental wetlands and water
– IIIB-166 –
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treatment facilities to remove heavy metals via lime precipitation, settlement and natural attenuation,
supported by site operational pro cedures. The objectives of the  Sepon water management system
are to:
 Minimize extraction of raw water from the environment by reusin g pit and process water where
practical.
 Divert clean water around mining areas and mineral waste facilities to prevent impact.
 Collect all site effluent waters (runoff from mineral waste fac ilities, stockpiles, open pits,
processing facilities and other general operations areas), test and treat to meet effluent discharge
compliance criteria prior to discharge offsite.
16.4.2 Waste Rock and Tailings Management
Waste rocks are generated as part of mining activities and are dumped into various waste dump
areas near the open pits. Based on an ARD assessment report dat ed September 2014, the
recommended criteria for non-acid forming (“NAF”) waste and potentially acid forming (“PAF”) waste
is that non-calcareous waste cont aining more than 0.3% S is ass umed to be PAF, and calcareous
rock units and non-calcareous waste containing less than 0.3% S  are assumed to be NAF. Waste
dump areas are generally located and constructed at the nearest  proximity to mining areas to
minimize haul distance. Mineral  waste facilities are predominat ely valley fill construction, although
several are mound or hill type of construction. The constructio n of waste dumps takes into account
the acid-generating and acid-consuming characteristics of the waste rock material to ensure that the
risk of acid rock drainage is reduced. The mitigation measures for the PAF waste dump area include
low permeable layer on the bottom, blending with limestone, encapsulation with clay, and final dump
covers with low permeable layers. PAF waste rock were also backfilled into exhausted open pits and
were encapsulated with 5m thick NAF waste. NAF waste rock from any of the pits may be used for
construction purposes such as th e tailing storage facility emba nkment, haul roads and sediment
control structures. Based on the observations and discussion du ring the site visit, this mine site
generally contains significant levels of dolomites, which can neutralize the ARD naturally and reduce
the impacts to the environment.
Tailings are generated from the processing plant, which contain  significant amount of sulfur
concentrate. In order to reduce the risk of ARD, tailings are s ent to the neutralization circuit where
they are neutralized with lime to a pH of 7 prior to dischargin g into TSFs. Since primary gold is
processed by pressure oxidation, associated sulfur is converted  to acid and neutralized before
sending to the TSF, ARD risk could be reduced significantly. Mo nthly water quality monitoring
undertaken previously identified elevated levels of sulphate and manganese in the surface waters of
Houay Nam Laeb and Houay Aria Creek, respectively, southwest of the WTSF. Inspection conducted
identified that the elevated sulphate and manganese is likely f rom WTSF supernatant. Three
seepage containment dams were constructed in 2017 to intercept,  contain and return the seepage
into WTSF, associated with lime treatment on the seepage water.
16.4.3 General Solid Waste Management
The Company states that the municipal solid waste is collected in designated areas and disposed of
into an on-site landfill to keep all project sites in good hous ekeeping. The Company has a program
– IIIB-167 –
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to recycle iron scraps, paper, plastic bottles, aluminum cans, and cardboards, and several identified
local subcontractors come to the site to collect them.
16.4.4 Hazardous subs tance management
The main hazardous material management for the Project comprise s the storage and handling of
processing chemicals including cyanide, limestones, paints, lubricant oil, gasoline, diesel, etc.  These
materials will not only harm the environment, also impact the safety and health of the workers. The
Company stores them with secondary containment, in compliance with various laws and regulations.
In addition, some certain levels of fuels are stored onsite for  mining and ore transporting, and they
are stored properly. The Project site is equipped with a high temperature incinerator to treat medical
waste. The oily waste and waste oil will be temporarily stored in the temporary storage of hazardous
waste and then handed over to qualified organizations for disposal and treatment.
16.4.5 Site Ecological Assessment
The development of mining and mineral processing projects may also result in impacts to or loss of
wildlife habitat. The project development ESIA reports determined the extent and significance of any
potential impacts to wildlife. Where these potential impacts ar e determined significant, the ESIA
reports proposed effective measures to reduce and manage them.
The Project is located in the Annamite Range Moist Forest ecoregion, which is one of Asia’s largest
contiguous natural forests, and supports a number of unique spe cies, many of which are endemic
and/or highly threatened. This region is listed as ‘Vulnerable’  as it is threatened by human impacts
including logging, wildlife trade and unsustainable natural res ource exploitation. In terms of aquatic
biodiversity, the Project is located in the Greater Mekong ecor egion. including wetlands, peat
swamps, subterranean streams, and crater lakes, which provide habitat for many other aquatic and
terrestrial flora and fauna. This ecoregion is considered ‘Vulnerable’ due to existing threats.
The Company implements biodiversity management through a set of  prioritised steps to avoid and
minimise the potential impact of the Project on biodiversity. S pecific commitments to biodiversity
include:
 Do not explore, mine or cause environmental impact within the boundaries of the United Nations
Educational, Scientific and Cultural Organization’s (“UNESCO”) “World Heritage List” properties;
 Avoid disturbance of biodiversity and other ecological values, and otherwise require an approved
Mitigation Management Plan or Biodiversity Offset Management Pl an prior to authorisation of
disturbance; and
 Implement the common Land and Biodiversity Management Critical Control Design that
considers topsoil management, erosion control, priority flora m anagement, priority fauna and
habitat management, and weed, exotic flora and pest animal management.
SRK notes that the site biodiversity management for the Project  follows Lao laws and regulations,
and internationally recognized guidance and practices.
– IIIB-168 –
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16.4.6 Dust, Gas and Noise Emissions
Dust will be generated from the open pits, haul road and dry beach area of TSFs during dry season,
and the Company uses water trucks to the open pits, haul road, and the dry beach area of the TSFs
to mitigate the dust emission. I n addition, the processing plan t could be a significant dust and gas
pollution source if without proper measures. The dust from the plant mainly comes from the coarse
crushing room, medium and fine crushing room, and screening roo m. According to SRK’s site visit,
all pieces of equipment of processing plant for crushing and sc reening are not placed in enclosed
spaces, and potentially causing fugitive dust pollution to the air. SRK recommends that all facilities
of processing plant be placed in multiple warehouses equipped w ith dust collection systems and
sprayers. Pressure Oxidation Plant (“POX”) plant discharges vapor to the environment.
The main noise sources for the Project are from the operation of fixed plant (crushers, compressors,
pumps, etc.) and mobile equipment (mainly ore haulage).  SRK notes that the potential for significant
off-site noise impact is low due to the site being remote (the nearest residence is approximately
several kilometers away from the project site).
16.4.7 Environmental Protection and Management Plan
The purpose of an operational Environmental Protection and Management Plan (“EPMP”) is to direct
and coordinate the management of the project’s environmental ri sks.  The EPMP documents the
establishment, resourcing and implementation of the project’s e nvironmental management
programs.  The site environmental performance is monitored and feedback from this monitoring is
then utilised to revise and streamline the implementation of the EPMP.  SRK notes that an operational
EPMP has been developed and implemented for the Project.  This EPMP incorporates operational
monitoring programs for the monitoring of air emissions, groundwater quality, and soil and water
conservation.
16.4.8 Site Closure Planning and Rehabilitation
Lao national legislation includes requirements for the closure of mining projects, including ecological
rehabilitation and the continued su stainability and social development of local communities. These
legislative requirements cover the need to conduct land rehabilitation, prepare a site closure report,
and submit a site closure application for assessment and approval.
The recognised international industry practice for managing site closure is to develop and implement
an operational site closure planning process and to document th is through an operational Closure
Plan. This operational closure planning process should include the following components:
 Identify all site closure stakeholders (e.g., government, employees, community);
 Undertake stakeholder consultation to develop agreed-upon site closure criteria and post-
operational land use;
 Maintain records of stakeholder consultation;
 Establish a site rehabilitation objective in line with the agreed-upon post-operational land use;
 Define and describe any site closure liabilities (i.e., as dete rmined against the agreed-upon
closure criteria);
– IIIB-169 –
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 Establish site closure management strategies and cost estimates  (i.e., to address/reduce site
closure liabilities);
 Establish a cost estimate and financial accrual process for site closure; and
 Describe the post site closure monitoring activities/program (i.e., to demonstrate compliance with
the rehabilitation objective/closure criteria).
SRK was provided with a conceptual closure plan dated May 2020.  SRK notes that the total mine
closure cost estimate is aroun d USD 255M, including rehabilitat ion of waste rock dumps, TSFs,
roadways, industrial area, ancillary facility demolition, water management, community transition, etc.
According to the MEPA between the Lao Government and the Company, the Company established
a rehabilitation and mine closure fund in 2003 contributing USD 1/oz gold and an equivalent rate of
all copper sales to the fund for the operational life of the mine. The rate has been increased to USD
3/zo since July 2021 according to the most recent MEPA. The Com pany provided a USD bank
statement of a Lao national bank, and the balance was USD 8.3M in March 2023, which will be used
for mine site rehabilitation excl usively. The Company is commit ted to conducting the mine closure
progressively throughout the mine life and on-going stakeholder  consultation, and follows the
international standards defined by the closure plan mentioned above.  Please note that under Laos
law, there is no requirement that additional mine closure secur ity bond to be paid in full, as the
balance should be provided on instalment each year according on  the project term. The aggregate
amount contributed by the Company to the rehabilitation mine closure fund was US$8,987,000 as at
30 September 2024. The Company has made a provision of US$236 m illion for the rehabilitation
work to be carried out in future in the financial statements, calculated by discounting remaining future
rehabilitation cash outflow of US$247 million to current value term.
16.4.9 Social Aspects
The Sepon Mine is located in Vilabouly District, Savannakhet wh ich has 73 villages with
approximately 8,200 households and 44,000 people, the majority of whom is located in rural areas.
These villages are populated by two main ethnic linguistic groups (Phou Thai and Mon-Khmer). This
district has a low level of infrastructure to support local activities and the project was developed within
an area of comparatively low socio-economic profile, primarily based on a subsistence economy.
Public participation and community consultation programs were c onfirmed as being undertaken for
the Project operation as part of  their ESIAs. SRK observed that  the Company had a good
understanding of the social dynamics and knowledge about the lo cal society. This Project provides
major employment opportunities for the locals and improves the local economy significantly. The
Company stated they have social dispute resolution mechanism and reported to SRK that complains
and grievance between the Company and local Laotians are resolved by communication. In addition,
According to the MEPA, Communi ty Trust Fund (“CTF”) has been es tablished to improve the
livelihood of local communities, with an annual contribution of USD 750k by the Company.
Areas in and around the Sepon Mine have a rich archaeological history and the Company has been
involved in archaeological and cultural heritage discovery and preservation in the area throughout
mine operations. These include artefacts including bronze drums , bronze weapons potteries, and
porcelains, cemeteries, spirit forests, caves and sites of local significance. One of the most significant
sites is the Dragon Field, a significant cultural site with possible connections to ancient copper mining
activities, which is declared as a national protected heritage site. This site is fenced by the Company
– IIIB-170 –
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and excluded from any mining activities. The Company implements  cultural heritage management
through the local authorities, universities and museums.
No non-compliance notices or other notices of a breach of environmental or social conditions for the
Project from the Local or Provincial governments have been sigh ted as part of this review. The
Company also stated to SRK that they maintain a strong relation ship with the local, provincial and
national governments along with the local police. As part of th is review, SRK has not sighted any
documentation in relation to any  actual or potential impacts of  non-governmental organisations on
the sustainability of Sepon Mine’s mining and processing operations.
16.4.10 Occupational Health and Safety
During SRK’s site visit, SRK observed that safety signs were in  place, safety provisions and rules
were also displayed within the work areas, moving machinery parts were appropriately guarded and
covered, guard railings were installed on all gantries, and pro per Personal Protection Equipment
(“PPE”) was provided and was being used by the workers, such as hardhats, traffic vests, and steel
toed shows.
SRK has sighted the OHS management system and procedures, which  provide the following
summary in respect to the proposed OHS management measures for the Project:
 Mining, crushing, blasting and explosives handling,
 Side slope failure prevention,
 Waste rock disposal,
 Environmental dust and noise suppression,
 Emergency response,
 Fire protection and fire extinguishment,
 Sanitary provision,
 Power provision,
 Unexploded ordnance (“UXO”) clearance;
 Labour and supervision, and
 Safety administration.
SRK notes that the above site occupational health and safety (“ OHS”) management measures are
generally in line with recognised international industry practices and Laos safety regulations.
The Company’s safety records indicate that there are 0, 0, 0, and 0 fatalities, 1, 1, 2, and 1 serious /
lost time injuries, and 27, 32, 4, and 7 minor injuries respect ively, in the past four years between
2021 and 2024, which were shown in Table 16-1. Incident descrip tions for these injuries were also
provided to SRK for review.
Table 16-1: OHS In cident Statistics
Years Minor Serious Fatality
2021 OHS Incident Statistics 27 1 0
2022 OHS Incident Statistics 32 1 0
– IIIB-171 –
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2023 OHS Incident Statistics 4 2 0
2024 OHS Incident Statistics 7 1 0
Reports analysing the cause of injuries and identifying measure s to prevent a recurrence were
provided to SRK. SRK notes that such analytical reports are pre pared in line with internationally
recognized OHS accident monitoring practice, as part of OHS management practice.
16.5 Evaluation of Environmental and Social Risks
The sources of environmental risk are project activities that m ay result in potential environmental
impacts.  These project activities have been previously described within this report. In summary, the
most significant potential environmental and social risks for the development of the Project, currently
identified as part of the project assessment and this SRK review, are:
 TSF seepage pollution;
 Fugitive dust pollution; and
 Deficit mine closure fund.
It is SRK’s opinion that the above environmental risks are categorised as medium risks (i.e., requiring
risk management measures) and they are generally manageable. Si nce various environmental
protection measures are planned or conducted by the Company to solve these environmental issues,
SRK considers that these environmental risks are controlled pro perly and not likely to develop into
higher level of risks.

– IIIB-172 –
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17 Capital and Operating Costs
17.1 Capital Expenditures
LXML has about 21 years of produ ction history since 2003. Capit al expenditures (“Capex”) for
construction of the mines, ore processing plants, on-site facilities etc. had been invested in the past.
LXML has made a plan for further capital expenditures as sustai ning capital in next three years, as
shown in Table 17-1. After reviewing the detailed sustaining capital forecast, SRK has observed that
while no specific capital expenditure for the paste plant is listed, the overall capital forecast appears
sufficient to cover these expenditures. Therefore, SRK has made  the assumption that the capital
forecast will adequately cover the capital expenditure required for the paste plant.
Table 17-1: Three Year Investment Plan Proposed by LXML
Item
Unit Budget Budget Budget
2024Q4 2025 2026
Growth USD 11,382,777 23,647,600  17,160,000
Exploration USD   3,289,314  8,282,649   8,046,405
Sustain USD 6,989,876 18,140,200  11,432,076
Total USD   21,661,967  50,070,449   36,638,481
Source: LXML
Sustaining capital includes capital development and all costs related to the acquisition, replacement,
or major overhaul of assets during the mine life required to sustain operations. According to the data
provided by LXML, the capital expenditures for the last three y ear from 2021 to 2023 are shown in
Table 17-2.
Table 17-2: LXML Sustaining Capi tal Expenditures from 2021 to 2023
Year Unit 2021 2022 2023
Sustaining Capital Expenditures USD  80,045,664  13,902,841   15,486,999
Source: LXML
The unit sustaining capital costs for past three years are show n in Table 17-3. Excluding the year
2021, SRK has developed a unit sustaining capital forecast base d on the average expenditures for
the years 2022 and 2023.
Table 17-3: LXML Unit Sustaining Capex from 2021 to 2023
Year Unit 2021 2022 2023 Average 1
Unit Sustaining Capital Expenditures USD/milled tone  21.8  3.2   3.7 3.5
Source: LXML
1 The average is based on the unit sustaining Capex in 2022 and 2023.
Table 17-4 summarises the further Capex needed for the LXML.
– IIIB-173 –
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Table 17-4: Further Capex needed  for LXML as of 30 September 2024
Item Unit 2024 2025 2026 2027 2028 2029 2030
Growth USD million  11.4   23.6   17.2
Exploration USD million  3.3   8.3   8.0
Sustain USD million  7.0   18.1   11.4   2.7   1.9   1.4   0.1
Total USD million  21.7   50.1   36.6   2.7   1.9   1.4   0.1
Sources: LXML and SRK
SRK assumes that working capital has been incorporated into the  sustaining capital. During the
economic analysis, non-current a ssets will be considered for amortization and depreciation.
Together with further Capex, they will adhere to the amortizati on and depreciation rates as
proposed in Table 18-2. It is reasonable to expect that the operation of the Sepon project will be
extended with further exploration and feasibility studies, the mine closure fees and the residual value
of the project will not be considered in the economic projection.
17.2 Historical Operating Costs
A summary of cash costs from 2021 to 3Q2024, which excludes the  depreciation, amortisation and
financial costs from the total costs, is shown in Table 17-5.
Table 17-5: Operating Costs in 2021, 2022, 2023 and 2024 Q1- Q3
Item 2021 2022 2023 Q1-Q3 2024
 Annual Cost (USD Million/a)
 Gold Operation
 Labor  28.4 22.7 23.1 18.2
 Material  107.8 178.6 140.1 89.4
 Electricity  13.3 12.2 18.4 14.8
 Contractors  0.1 0.0 0.0 0.0
 Engineering  0.0 0.0 0.0 0.0
 Service  0.0 0.0 0.0 0.0
 Safety  - - - -
 Repairment  --- -
 Others  0.0 0.0 0.0 0.0
 Copper Operation
 Labor  2.1 2.9 4.0 2.9
 Material  7.4 22.2 24.0 14.2
 Electricity  1.0 1.4 3.4 2.3
 Contractors  0.0 0.0 0.0 0.0
 Engineering  0.0 0.0 0.0 0.0
 Service  0.0 0.0 0.0 0.0
 Safety  - - - -
 Repairment  --- -
 Others  0.0 0.0 0.0 0.0
– IIIB-174 –
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Item 2021 2022 2023 Q1-Q3 2024
 LXML Operation
 Non-income Taxes, Royalties and Surcharges  17.2 20.0 21.7 16.7
 Selling costs  0.1 0.1 0.1 0.0
 G&A costs  16.8 4.5 18.5 13.1
 R&D costs  - - - -
 Total  194.4 264.5 253.2 171.6
 Unit Cost (USD/milled ton)      Average For TEM 1
 Gold Operation
 Labor  8.3 6.4 7.5 7.7 7.5 9.0
 Material  31.6 50.2 45.4 37.9 41.3 51.0
 Electricity  3.9 3.4 6.0 6.3 4.9 7.0
 Contractors  0.0 0.0 0.0 0.0 0.0 0.0
 Engineering  0.0 0.0 0.0 0.0 0.0 0.0
 Service  0.0 0.0 0.0 0.0 0.0 0.0
 Safety  - - - - - -
 Repairment  - - - - - -
 Others  0.0 0.0 0.0 0.0 0.0 0.0
 Copper Operation
 Labor  8.4 3.7 3.6 3.5 4.8 9.0
 Material  29.1 28.8 21.7 16.8 24.1 30.0
 Electricity  4.0 1.8 3.0 2.7 2.9 4.0
 Contractors  0.0 0.0 0.0 0.0 0.0 0.0
 Engineering  0.0 0.0 0.0 0.0 0.0 0.0
 Service  0.0 0.0 0.0 0.0 0.0 0.0
 Safety  - - - - - -
 Repairment  - - - - - -
 Others  0.0 0.0 0.0 0.0 0.0 0.0
 LXML Operation
 Non-income Taxes, Royalties and Surcharges  4.7 4.6 5.2 5.2 4.9 6.0
 Selling costs  0.0 0.0 0.0 0.0 0.0 0.0
 G&A costs  4.6 1.0 4.4 4.1 3.5 5.0
 R&D costs  - - - - - -
 Total  94.7 100.1 96.9 84.3 94.0 121.1
Sources: LXML
1 The unit cost forecast is based on the maximum value from the past three years, rounded up to the nearest whole number.
If the unit cost is less than 1.0 USD/feed ore, then the maximum value is used.

– IIIB-175 –
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17.3 Opex Forecasting
The year-by-year Opex forecasting was set forth in Table 17-6.
Table 17-6: Operating Costs Forecast of LXML
Item  Q4 2024 2025 2026 2027 2028 2029 2030
 Annual Cost (USD Million/a)
 Gold Operation
 Labor   12.9   25.2   17.2   6.9   4. 9   3.6   0.3
 Material  73.2 143.0 97. 4   39.2   27. 9 20.5 1.6
 Electricity   10.0   19.6   13. 4   5.4   3.8   2.8   0.2
 Contractors  0.0 0.1 0.0   0.0   0.0  0.0 0.0
 Engineering   0.0   0.0   0. 0   0.0   0.0   0.0   0.0
 Service  0.0 0.0 0.0   0.0   0.0  0.0 0.0
 Safety   -     -     -     -     -     -     -
 Repairment  -   -   -     -     -    -   -
 Others   0.0   0.0   0 .0   0.0   0.0    0.0   0.0
 Copper Operation
 Labor   4.0   6.6   -     -     -     -     -
 Material  13.4 22.2 -     -     -    -   -
 Electricity   1.8   3.0   -     -     -     -     -
 Contractors  0.0 0.0 -     -     -    -   -
 Engineering   0.0   0.0   -     -     -     -     -
 Service  0.0 0.0 -     -     -    -   -
 Safety   -     -     -     -     -     -     -
 Repairment  -   -   -     -     -    -   -
 Others   0.0   0.0   -     -     -     -     -
 LXML Operation
 Non-income Taxes, Royalties and Surcharges    11.3   21.2   11. 5   4.6   3.3   2.4   0.2
 Selling costs  0.0 0.1 0.0   0.0   0.0  0.0 0.0
 G&A costs   9.4   17.7   9.5   3. 8   2.7   2.0   0.2
 R&D costs  -   -   -     -     -    -   -
 Total   136.1  258.7  149.0   60.1   42.6  31.3  2.5
Sources: SRK
17.4 Metal Prices
The primary project revenue is from gold and copper, Figure 17-1 shows the historic gold and copper
price.  Price forecast of CMF is shown in Figure 17-2.
– IIIB-176 –
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Figure 17-1: Gold and Coppe r 5 Years Historic Price

Sources: Kitco

– IIIB-177 –
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Figure 17-2: Gold and Co pper Price Forecast


Sources: SRK
Notes: 2024Q1 CMF, Spot in 19 February 2024.
Table 17-7 shows the annual gold and copper price forecasts use d by SRK, which is a consensus
market forecast, considering various forecasts made by other professional institutions.
Table 17-7: Forecasted Gold and Copper Prices by SRK in the 3 rd Quarter of 2024
Item Unit 2024 2025 2026 2027 2028 2029 2030
Copper price US/t  9,350  9,600
Gold price US/oz  2,480  2,480  2,360  2,220  2,130   2,000   2,000
Sources: SRK
– IIIB-178 –
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17.5 Tax Obligations
Based on the documents signed between Laos Government and the MEPA’s previous owner, CRA,
the owner of the mining licenses and exploration permits has following tax obligations.
Company Income tax: once the project produces profit, the company will have a two year tax free
period, and have to pay 16.67% income tax of taxable income for the third year, and then will pay full
tax rate of 33.33% afterwards.

– IIIB-179 –
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18 Economic Analysis
It is important to note that the purpose of this analysis is so lely for the purpose of Ore Reserve
estimation. The derived NPVs do not indicate the fair market values or the profitability of the projects.
The estimated cash flows and NPVs were presented on an after-tax basis, and financing costs were
not considered..
The economic analysis was conducted using conventional Discount ed Cash Flow (“DCF”)
techniques. The Net Present Value (“NPV”) was determined from the project's cash flow using a 10%
discount rate. It should be noted that SRK’s DCF modelling and NPV calculation are carried out with
the purpose of testing the “economic viability” of the Project which is required to a reasonable Ore
Reserve reporting. Additionally, a sensitivity analysis was per formed to examine the effects of
changes in Capex, Opex, and gold price (revenue).
18.1 Principal Assumptions
The assumptions used to carry out the economic analysis are listed below:
 The discounted cash flow method (the “DCF”) is selected as the foundation of economic analysis.
The discount rate is 10%, which is a widely used value for a simple economic analysis.
 The base date is assumed to be 30 September 2024, and all the o perations related data are
subject to conditions obtained at the base date.
 The production schedules are shown in Table 11-21.
 The Capex are shown in Section 17.1.
 The working capital is assumed to be incorporated into the sustaining capital. The mine closure
fees and the residual value of the project will not be considered in the economic projection.
 The capital forecast would cover the expenditures for the paste plant.
 The Opex forecasts are shown in Section 17.3.
 The taxes and their rates are shown in Table 18-1.
 The financial interests were not considered (i.e. 100% interest ), as it’s an internal cash flow
among investors for a project.  It has nothing to do with a project’s economic viability.
 The final product will be sold entirely in a calculating year, with no inventory at the end of each
year.
Table 18-1: Taxes and Surcharges Assumption
Item Unit Value
Corporate income tax (CIT) % taxable income 33.33
Sources: LXML
18.1.1 Technical and Economic Parameters
For the economic analysis of the Projects, SRK adopted a discou nt cashflow analysis based on
previous assumptions and parameters as presented in Table 18-2.
– IIIB-180 –
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Table 18-2: Technical and Economic Parameters
Item Unit Amount Remarks
Gold Production
Open Pit
Proved+Probable kt 2,206
Grade g/t 1.86
Production Plan ktpa 1,600/800/400 As mine plan
LoM years 3 2024-2026
Underground
Proved+Probable kt   3,505
Grade g/t   4.21
Planned Production Capacity ktpa 800 As mine plan
LoM years 7 2024-2030
Stockpiles
Proved+Probable kt 2,185
Grade g/t   2.61
Planned Production Capacity ktpa 1,200 As mine plan
LoM years 3 2024-2026
Copper Production
Proved+Probable kt   1,185
Grade g/t   0.93
Planned Production Capacity ktpa 700-900 As mine plan
LoM years 2 2024-2025
Processing and Metallurgy
Capacity
Gold Capacity ktpa 3,800 Enough for oxide and primary
ore
Copper Capacity ktpa 1,300 Enough for oxide copper only
Overall Recovery
Gold Processing %  65.0
Copper Processing %  45.0
Opex
Gold Operation USD/milled ton 67.0
Copper Operation USD/milled ton 43.0
 Non-income Taxes,
Royalties and Surcharges
USD/milled ton  6.0
 Selling costs  USD/milled ton  0.0
 G&A costs  USD/milled ton  5.0
 R&D costs  USD/milled ton  -
Working Capital % 0.0  Section 17.1
Capex
Growth in Three Years USD million 52.2 As mine plan
Exploration in Three Years USD million 19.6 As mine plan
Sustain USD million 42.6 As mine plan with SRK's
Assumption
Sustain Unit Cost USD/milled ton  3.5  Based on 2022 and 2023
Mine Closure USD million  255.0  Section 16.4.8, exclusive in this
analysis
Taxation
Enterprise income tax % 33.33 Based on taxable income
Other Parameters
– IIIB-181 –
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Item Unit Amount Remarks
Amortization of intangible
Capex and other Capex
years 10
Depreciation of tangible
Capex
years 10
Discount rate % 10
Sources: SRK
18.1.2 Production Schedule
Figure 18-1 and Figure 18-2 are the production schedule for gold and copper.
Figure 18-1: Gold Production Schedule


Sources: SRK
Notes:
1 The line represents the average gold grade, corresponding to the right axis.
2 The column represents the ore amount, corresponding to the left axis.

Figure 18-2: Copper Production Schedule

– IIIB-182 –
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Sources: SRK
Notes:
1 The line represents the average copper grade, corresponding to the right axis.
2 The column represents the ore amount, corresponding to the left axis..
18.1.3 Capital Costs
Figure 18-3 is Annual Capex over the LoM.
Figure 18-3: Annual Capex over the LoM


Sources: SRK
– IIIB-183 –
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18.1.4 Operating Costs
Figure 18-4 are annual Opex over the LoM.

Figure 18-4: Annual Opex over the LoM



Sources: SRK

18.1.5 Tax and Surcharges
Non-income tax, royalties and other surcharges have been considered in Opex. The income tax for
LXML is 33.3%.
18.1.6 Amortization and Depreciation
SRK uses the straight-line depreciation method as the economic analysis assumption, and the
amortization and depreciation period are 10 years. Salvage valu e of invested Capex will NOT be
considered to be reclaimed at the end of the mine's life.
18.2 Financial Net Present Value
The annualised net cash flow ("NCF”) was calculated and shown in Table 18-3.
Table 18-3: NCF Calculation
Item Unit Total 2024  2025 2026 2027 2028 2029 2030
Cash inflow
Revenue USD million 1,252.69  142.2  440.9 372.7  128. 7   92.7  71.3  4.2
– IIIB-184 –
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Item Unit Total 2024 2025 2026 2027 2028 2029 2030
Sub-total USD million 1,252.69  142.2  440.9 372.7  128. 7   92.7  71.3  4.2
Cash outflow
Opex USD million  680.3  136.1  258.7 149.0   60. 1   42.6  31.3  2.5
Corporate Income
Tax USD million  175.3   1.4   58.7  71.6   19.8   13.6  10.2  -
Working Capital USD million -   -   -    -     -     -   -   -
Capex USD million  114.4  21.7   50.1  36.6   2.7   1.9  1.4  0.1
Mine Closure USD million -   -   -    -     -     -   -   -
Sub-total USD million  970.0  159.2  367.5 257.3   82. 6   58.1  42.9  2.6
NCF
NCF Total USD million  282.7 (17.0)  73.4 115.5   46. 2   34.6  28.4  1.7
Sources: SRK
Figure 18-5 shows the net cash flow over the LoM.
Figure 18-5: Annual Net Cash Flow



Sources: SRK
The net present values at a 10% discount rate (“NPV10”) are USD  347.7 million.  NPVs at various
discount rates are shown in Table 18-4. SRK considered the Projects are economically viable for the
future operations.
Table 18-4: NPV Projections
Discount Rate (%) NPV (USD million)
5 259.3
6  255.1
– IIIB-185 –
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Discount Rate (%) NPV (USD million)
7  251.0
8 247.1
9  243.3
10 239.6
11  236.0
12 232.6
13  229.2
14 226.0
15  222.8
Sources: SRK
18.3 Sensitivity Analysis
SRK applied a single factor method for the sensitivity analysis to the combined open-pit, underground
gold production, and stockpile rehandling copper production of LXML. Many parameters can affect
the Project’s NPV. To simplify the calculations, the Opex, and the gold and copper prices were
selected as the essential variable factors on cash flow. The effects of these essential factors on the
NPV were analysed within a ±30% range. The results are shown in Table 18-5 and Figure 18-6.
Table 18-5: Sensitivity Study o f NPV (at 10% Discount Rate, in USD Million)
Change Opex Gold Price Copper Price
-30% 364.3 12.6 230.0
-25% 343.6 50.6 231.8
-20% 322.8 88.7 233.4
-15% 302.0 126.8 235.0
-10% 281.2 164.9 236.5
-5% 260.4 202.9 238.1
0% 239.6 239.6 239.6
5% 218.0 275.6 241.2
10% 194.9 311.6 242.7
15% 171.8 347.6 244.3
20% 148.8 383.6 245.8
25% 125.7 419.6 247.4
30% 102.7 455.6 248.9
Sources: SRK
Figure 18-6: NPV (at 10%) Vs.  G old Price or Copper Price or Opex


– IIIB-186 –
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Sources: SRK
As shown in the Figure 18-6 above, changes in Opex and gold prices have bigger effect on the
Project’s NPV than copper prices.
Preliminary analysis indicates that high mine closure costs are  the major negative factor affecting
the project's economic feasibility.
– IIIB-187 –
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19 Conclusions and Recommendations
19.1 Geology, Exploration and Mineral Resources
Mineralization styles of the S epon district can be classified a s an intrusion-centred hydrothermal
system with the majority of known Cu and Au mineralization spatially associated with the Padan and
Thengkham porphyry centres. Mineralisation typically displays a zoned pattern in both mineralization
type and metal content. Porphyry M o-Cu systems occur at the cor e zoning outward through skarn
and carbonate replacement Cu deposits to the Au dominated sediment-hosted systems which show
Carlin type deposit characteristics.
A total of 1,022 DD (117,495m), 2,3732 RC (no Grade Control) (1 75,499.2m) RC drill holes and
45,635 RC Grade Control holes (764,831.8m) for a total of 1,057 ,826m were used to construct the
Discovery region block model. After Chifeng Gold took over the Sepon project, the exploration
programs mainly focused on discovering new gold deposits in bro wnfield to supply the processing
plant and keep on the production, as well as discovering new types of mineralization in green field.
Although the majority of discovered gold and copper deposits ha d been mined out, there are still
some mineral resources of oxidized and primary gold, as well as  low grade copper in the Sepon
project area.
LXML pays a great attention to further explore new oxide gold a nd copper resources suitable for
open-pit operation, and the primary type of resources is possible at the deep extensions of previous
and current open-pits.
19.2 Mining and Ore Reserves
19.2.1 Gold Operation
For surface mining:
The gold open pit mining is going to be completed in near future (about three year).  Based on SGPS,
the final open pit designs have been applied by LXML to guide mining boundaries.  Mining cycle and
management have been practised for a long time.  SRK considers the significant risk will be low for
the open pit mining in future.
There are still 35 gold stockpile s that are economically feasib le to buffer and supply the gold
processing plant during periods of low production rates from open-pit mining.
In the meantime, SRK noted that LXML has already started some i nternal technical preliminary
studies for exploitation of Far West Area to provide inventory.
For underground mining:
In SGPS, the proposed mining methods in the DSE UG include long -hole stoping with cemented
backfill (“LHSB”), long-hole stoping with pillars (“LHSP”), and post pillar cut and fill (“PPCA”).
– IIIB-188 –
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Construction of the underground mine commenced in April 2022 at  DSE UG. As of 30 September
2024, SRK was provided with revised ventilation designs and und erground workings designs by
LXML.
SRK re-ran the stope optimizati on based on LHSB, as selected by  LXML, then applied modifying
factors and prepared the producti on schedule based on a review of LXML’s data. SRK notes that
LHSB has been widely practiced globally and is technically feasible.
For DSW UG, LXML is still conducting additional exploration work to increase geological confidence.
19.2.2 Copper Operation
As of 30 September 2024, only hydrometallurgical process was in  operation for oxide copper
stockpiles.
Based on the fact mentioned above, only oxide copper stockpiles  which were above cut-off grade
were estimated to Ore Reserves.
In the meantime, SRK noted that LXML has already started some i nternal technical preliminary
studies for exploitation of TKM OP to provide more oxide copper inventory and of KHN UG to provide
more primary copper inventory.
19.3 Ore Processing and Metallurgy
Sepon gold ores are refractory due to the ultra-fine deportment, arsenic and organic carbon. The
oxide ore is processed using CIL process in the Sepon Gold Plant, with historical throughput varying
between 1.0 and 1.5 Mtpa. The gold recovery varies between 51.8% and 68.9%.
The Sepon Gold Plant adopts a complex flowsheet to process prim ary gold ore. The gold is first
concentrated in a flotation circuit after crushing and grinding to obtain a gold concentrate, then POX
process is applied to the concentrate. The post POX residue is CCD washed and then leached in
CIL circuit. Gold loaded carbon from both oxide ore and primary  ore is processed by elution,
electrowinning, and smelting to produce Gold Doré. The historical throughput ranges from 1.9 to 2.1
Mtpa, and gold recovery ranges from 55% to 67%.
The yearly gold production of the gold plant is exceeds 6 t. Mo st of the facilities and equipment of
the gold plant were converted from the copper plant. Historical production proves it is practicable.
The Sepon Copper Plant has a flexible capacity using heap leach  and agitation leach processes.
The coarse ore is sent to heap leach while the fine ore goes to agitation leach. A conventional sulfuric
acid leach-CCD-SX/EW process is adopted in the plant to process oxide ore, producing electrolytic
copper or cathode copper. Historical production data of the copper plant shows that 0.5 to 1.3 Mtpa
of oxide copper ore is processed;  cathode copper production is around 6,000 tpa with the copper
recovery varying from 50% to 78%.
The well-quipped metallurgical laboratory on site strongly supports the normal operation of the plants.
Low grade primary copper ore is a menable to the flotation proce ss. Flotation tests indicated that
copper recovery above 80% with concentrate grade of 18% to 24% can be achieved using
conventional flotation process. A Proof-of-Concept study has be en completed for the purpose of
– IIIB-189 –
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primary copper resource development. By using the existing facilities of the current gold plant and a
throughput of 7.5 Mtpa, the NPV is negative. The break-even price is USD 9,119 per tonne of copper.
The primary copper resource development would need a higher cop per price and reliable resource
volume. A detailed feasibility study is recommended in due time.
19.4 Mine Economy
Based on the information provided by LXML, SRK carried out preliminary review and analysis
indicating that the mine plans about three years of open-pit gold operation, seven years of
underground gold operation, three years of gold re-handling ope ration and two years of copper re-
handling operation.  Based on the parameters reviewed and summarized in the report, an economic
analysis was conducted indicating that the operation of open-pi t gold production, rehandling
stockpiles and underground mine will be profitable.

– IIIB-190 –
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20 Project Qualitative Risk Analysis
Mining is a relatively high-risk industry. In general, the risk  may be expected to decrease from
exploration, development, through to production stage. The Sepo n Project is a production project.
Risks exist in different areas. SRK considered various technica l aspects which may affect the
feasibility and future cash flow of the Project, and conducted a qualitative risk analysis which has
been summarised in Table 20-1. In this risk analysis, various r isk sources/ issues have been
assessed for Likelihood and Consequence, and then a Risk Rating  has been assigned. The
qualitative risk analysis uses the following definitions for likelihood and consequence:
In the risk assessment, various risk issues have been assessed for Likelihood, Consequence, and
Overall Rating. SRK has used a matrix as follows:
The Likelihood of a risk is considered within a certain time frame, e.g. 5 years, as:
Likely: will probably occur;
Possible: may occur; and
Unlikely: unlikely to occur.
The Consequence of a risk is classified into:
Major Consequence: the factor poses an immediate danger to the Project, if uncorrected, will have
a material effect on the Project cash flow and performance and could lead a project failure;
Moderate Consequence: the factor, if uncorrected, will have a significant effect on the Project cash
flow and performance; and
Minor Consequence: the factor, if uncorrected, will have little or no effect on the Project cash flow
and performance.
The overall risk assessment combines the Likelihood and Consequence of a risk and be classified
as Low (unlikely and possible minor risks and unlikely moderate risk), Medium (likely minor,
possible moderate and unlikely major risks), and High (likely moderate and major and possible
major risks).
Below is the qualitative risk analysis summary table of the Sepon Project.
– IIIB-191 –
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Table 20-1: Project Risk Assessment of the Sepon Project
Risk Source/Issue Likelihood Consequence Overall
Geology and Resource
Lack of Significant Mineral Resources Unlikely Moderate Low
Lack of Significant Ore Reserves Possible Major High
Unexpected Groundwater Ingress Unlikely Minor Low
Mining
Significant Production Shortfalls Unlikely Major Medium
Significant Geological Structure Possible Minor Low
Excessive Surface Subsidence Unlikely Minor Low
Poor Ground Conditions Possible Moderate Medium
Ore Processing
Lower Recovery Unlikely Moderate Low
High Production Cost Possible Minor Low
Poor Plant Reliability Unlikely Minor Low
Capital and Operating Costs
Project Timing Delays Possible Minor Low
Capital Cost Increases Unlikely Minor Low
Operating Cost Underestimated Likely Minor Medium
High mine closure cost Likely Moderate High
Environmental, Social and Permitting
Impact to the ecological system Possible Moderate Medium
Poor waste rock management Possible Moderate Medium
Poor hazardous substances management Possible Minor Low
Dust Pollution Possible Minor Low
Renewal of mining licence Unlikely Major Medium
Some medium and high risks have been identified for the Project .  Two high risks are “Lack of
significant Ore Reserves” and “High mine closure cost”. To manage the risks, SRK recommends the
Company should further conduct feasibility studies to develop currently available mineral resources
in order to extend the mine life of the project, as well as pro actively manage the environmental and
mine closure issues during the production, in order to reduce the high mine closure cost at the end
of the mine.
– IIIB-192 –
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FOR THE SEPON GOLD AND COPPER MINE


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21 References
1. Lane Xang Minerals Limited, 2021; LXML Sepon – Fact sheet; LXML PowerPoint presentation
2. Lane Xang Minerals Limited, June 2022; Sepon LoM Project Review ; LXML PowerPoint
presentation
3. Lane Xang Minerals Limited, August 2022; Report on General Pros pect of the Rare Earth
Elements Deposit in the southern portion of Sepon Mine in Savannakhet Province, Laos
4. Lane Xang Minerals Limited, Oct ober 2022; 2022 Sepon Mineral Re source Statement; LXML
internal report
5. Lane Xang Minerals Limited, December 2022; DSE Deeps Underground mine Overview; LXML
PowerPoint presentation
6. Lane Xang Minerals Limited, December 2022; Exploration Overview ; LXML PowerPoint
presentation
7. Lane Xang Minerals Limited, Decem ber 2022; LoM Mine Production Plan-2022; LXML
PowerPoint presentation
8. Lane Xang Minerals Limited, Decem ber 2022; LXML Sepon-Environme ntal management –
Social responsibility; LXML PowerPoint presentation
9. Lane Xang Minerals Limited, December 2022; LXML Sepon – Growth Opportunities; LXML
PowerPoint presentation
10. Lane Xang Minerals Limited, December 2022; Sepon Copper Flotati on-TKM and KHN
Optimisation; LXML PowerPoint presentation
11. Lane Xang Minerals Limited, December 2022; YTD 2022 Environment  Performance Report;
LXML PowerPoint presentation
12. Porter Geo Consultancy, 2006; Khanong-Sepon Geology; www.portergeo.com.au
13. Tony Manini and Peter Albert, 2001(?); Exploration and developm ent of the Sepon Gold and
Copper Deposits, Laos. (Oxiana Limited), from the Internet






– IIIB-193 –
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FOR THE SEPON GOLD AND COPPER MINE


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Closure
This report, Competent Person's Report for the Sepon Gold and Copper Project, Lao People's Democratic Republic,
was prepared by


Anshun Xu (Corporate Consultant))
Project Manager

and reviewed by


Yonglian Sun (Corporate Consultant)
Contributing Peer Review


All data used as source material plus the text, tables, figures, and attachments of this document have been reviewed and prepared
in accordance with generally accepted professional engineering and environmental practices.
– IIIB-194 –
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Appendix A Copy of the Mining License
– IIIB-195 –
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– IIIB-197 –
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(English Translation)
Lao People’s Democratic Republic
Peace Independence Democracy Unity Prosperity

Ministry of Energy and Mines No. 24-23/MEM.DMM
Department of Mines Management      License No ML0002

MINING LICENSE
(2nd Extension)

—Pursuant to the Minerals Law (amended version) No 31/NA dated 3 November 2017;
—With reference to the Minister of Energy and Mines’ Decision (2 nd Extension) No 0837/MEM, dated 10
May 2023.

The Department of Mines Management issues this permit to LANE X ANG MINERALS LIMITED under the name of
Mr Saman Aneka, Lao National, ID number: 01-22 026932, Director of the company.
Headquarter of the company is located at: House Number……., Bourichanh Road, Phonsinouan Village, Sisattanak
District, Vientiane Capital, Tel. 021-268206; Fax. 021-268201, email. saman.aneka@lxml.la.
Authorized minerals: gold and copper ore; within: 11,696 (Eleve n thousand six hundred and ninety-six) hectares,
located in Nong Kadaeng Village, Vilabouly District, Savannakhet Province.
Operational costs: USD169,000,000 (One hundred sixty-nine million US Dollars).
Project timeframe: 10 (ten) years from 30 September 2023 to 29 September 2033.


Vientiane Capital, 24 May 2023
Director General
Department of Mines Management

Signed and Sealed
Mr Chanthala Keohavong
– IIIB-198 –
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Note:
It is forbidden to alter or modif y any wording in this license
without proper authorization. Wrongdoers will be punished as
provided by the law of Lao PDR.
This license replaces the previous License No 013-19/MEM.DMM, dated 9 September 2019.
Application guidelines and conditions of this license:
1. This mining license is applicable to mining of minerals within the authorized area only;
2. The timeframe shall be as indicated in this license; this license is no longer valid upon its expiry. In the
event of renewal, an application is to be lodged to the Department of Mines Management within 90 days
prior to expiration of this license;
3. This license may not be placed as security;
4. This license applies exclusively to the company authorized by the government;
5. This license must be displayed at an open space at the business operation site or in the office;
6. This license was printed 3 copies only, 1 copy handed to the authorized company and 2 copies kept at the
Mines Management Department;
7. The recipient of this license is required to pay a license fee in accordance with rules and regulations to be
enacted.

– IIIB-199 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Appendix B JORC Table 1
– IIIB-200 –
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Section 1: Sampling Techniques and Data
(Criteria in this section apply to all succeeding sections.)
Criteria Explanation Commentary
Sampling
techniques
Nature and quality of sampling (e.g. cut channels,
random chips, or specific specialised industry
standard measurement tools appropriate to the
minerals under investigation, such as downhole
gamma sondes, or handheld XRF instruments,
etc.). These examples s hould not be taken as
limiting the broad meaning of sampling.
Include reference to measures taken to ensure
sample representivity and the appropriate
calibration of any measurement tools or systems
used.
Aspects of the determination of mineralisation that
are Material to the Public Report.
In cases where  ‘industry  standard’  work has been
done this would be relatively simple (e.g. ‘reverse
circulation  drilling  was used to obtain 1 m samples
from which 3 kg was pulverised to produce a 30 g
charge for fire assay’). In other cases more
explanation may be required, such as where there
is coarse gold that has inherent sampling
problems. Unusual commodities or mineralisation
types (e.g. submarine nodules) may warrant
disclosure of detailed information.
Diamond drill core was sampled as half core at
nominal 1-metre intervals to geological
contacts. All 1-metre intervals start again
immediately after the geological contact.
Minimum samples of 0.3 metres were taken.
Reverse Circulation (RC) chip samples were
routinely collected in calico bags and chip box
trays at 1-metre intervals. No field composites
were created.
To ensure representative sampling, industry
standard practice has been applied. The
laboratory has applied appropriate QA-QC to
sample preparation and appropriate calibration
to analytical instrument s.  Oriented diamond
core was marked for recovery and samples
considering mineralization intensity and veining
orientations, then sawn, with half core being
sampled.
RC chip samples were collected using either a
three-tiered riffle splitter, with either two or three
tiers used, depending on sample size, or a
rotary cone splitter.  Cyclone and splitter was
routinely inspected and cleaned as a minimum
between each drill rod.
Industry standard work has been undertaken for
both diamond and RC samples:
RC drilling was used to obtain 1m samples from
which approximately 3kg was dried and
pulverized then sub-sampled to produce a 30g
charge for analysis.
Diamond drilling was used to obtain drill core
that was sampled on nominal 1m lengths
except for adjustments around lithological
boundaries.  Most core has been sampled as
half core.  In early 2023, UG drill core has been
sampled as whole core.  Core samples
(generally 3 to 6kg) are dried and pulverized
then sub-sampled to produce a 30g charge for
analysis.
Until August 2021, Resource drill samples
collected (both RC and DD) were analysed by
ALS laboratories, using both their Lao and
– IIIB-201 –
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Criteria Explanation Commentary
Australian facilities.  ALS standard analysis
methods were used:
Au-AA25 Au (Fire Assay Gold)
Prepared sample with a 30g charge is fused
with a mixture of lead oxide, sodium carbonate,
borax, silica and other reagents as required and
then cupelled to yield a precious metal bead.
The bead is digested in 0.5 mL dilute nitric acid
in the microwave oven. 0.5 mL concentrated
hydrochloric acid is then added, and the bead is
further digested in the microwave at a lower
power setting. The digested solution is cooled,
diluted to a total volume of 10 mL with de-
mineralized water, and analyzed by atomic
absorption spectroscopy (AAS) using matrix-
matched standards.
ME-ICP61 multi-element analysis (4 Acid
Digest; Atomic Emission Spectroscopy Finish)
A prepared sample (0.25 g) is digested with
perchloric, nitric, hydrofluoric and hydrochloric
acids. The residue is topped up with dilute
hydrochloric acid and the resulting solution is
analyzed by inductively coupled plasma-atomic
emission spectrometry (ICP-AES).
Results are corrected for spectral interferences.
Since August 2021, all samples including
resource drilling samples have been analysed
in the LXML Sepon assay laboratory applying
industry standard methods as follows:
Fire assay Au: 30g charge with 150g flux (lead
oxide, sodium carbonate,  borax, silica, iron,
flour, silver nitrate), fusion (1 hour), cupellation
(1 hour), digestion with 50% nitric and
hydrochloric acid, followed by AAS finish.
ICP for Ag and As using 0.25g charge, digested
with aqua regia (hydrochloric and nitric acid)
AAS for Ca, Cu, Fe, Mg, Mn using a 0.3g charge
and digested with hydrochloric, nitric and
perchloric acid.
Sulphur and Carbon analyser using a 0.3g
charge digested with hydrochloric, nitric and
perchloric acid.
– IIIB-202 –
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Criteria Explanation Commentary
Leachwell Au using a 35g charge adding 10g
cyanide tablet and water, tumbled (1 hour) with
AAS finish.
PRI analysis with a 35g charge with 1.7ml of
spike and 10g cyanide tablet added, tumbled (1
hour) with AAS finish.

Drilling techniques
Drill  type (e.g. core, reverse circulation, open-hole
hammer, rotary air blast, auger, Bangka, sonic,
etc.) and details (e.g. cor e diameter,  triple or
standard tube, depth of diamond tails, face-
sampling bit or other type, whether core is oriented
and if so, by what method, etc.).
Diamond drilling was carried out predominantly
using HQ3 and PQ3 core-sized equipment with
standard coring tube.  Triple tube coring was
applied historically for recovering samples in
minerlised clay materials. Approximately 86%
of the core at Sepon is HQ3 size.
For RC drilling, a face sampling bit (121 mm)
was used.
All core has been oriented using predominantly
the ACE orientation system or an Eastman
single-shot system
Drill sample
recovery
Method of recording and assessing core and chip
sample recoveries and results assessed.
Measures taken to maximise sample recovery and
ensure representative nature of the samples.
Whether a relationship exists between sample
recovery and grade and whether sample bias may
have occurred due to preferential loss/gain of
fine/coarse material.
Recoveries from core drilling were measured
and recorded in the database. Core recovery
averaged 91% whilst RC recovery averages
80% by mass. Higher core loss occurred in
oxide, karst infill and highly fractured
(unmineralised) chert units.
Historically RC samples were weight for the
entire sample to check sample recovery.
Currently the spilt sample is weighed, which
indicates the total mass of the material
recovered.
Ground conditions at Sepon are generally good
and drilling practices have been consistent for
many years, leading to experience in gaining
high core and sample recoveries.
• Diamond drilling used drill muds and
short runs in broken ground to maximize
recovery.
• Drilling is undertaken using auxiliary
compressors and boosters to keep the hole dry
and maximise sample lift.
• Several twin hole programs assessed
results obtained from both RC and core holes.
– IIIB-203 –
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Criteria Explanation Commentary
In general, the repeatability for gold was
confirmed. An overall bias was not seen.
• Diamond holes may be drilled using
RC pre-collars to ensure good sample recovery
of poorly or semi-consolidated rock.
• In places, RC holes have been
twinned with diamond holes to determine if any
bias is detected regarding recovery between
mineralised and barren material, to date it has
not been deemed materially biased.
Logging
Whether core and chip samples have been
geologically and geotechnically logged to a level of
detail to support appropriate Mineral Resource
estimation, mining studies and metallurgical
studies.
Whether logging is qualitat ive or quantitative in
nature. Core (or cost ean, channel, etc.)
photography.
The total length and percentage of the relevant
intersections logged.
All RC and DD core was logged on paper log
sheets and entered manually into the Sepon
database until 2015.
Post 2015 logging is predominantly carried out
on tablets and automatically linked to the
database. Several quality control (QC) triggers
are set in the database to validate data as
entered.
Drill core was logged in detail for stratigraphy,
lithology, alteration, mineralization, oxidation
state, structure and veining. RC cuttings were
logged for various geological attributes
including rock type by the mineral composition,
mineralization by veining and visible minerals,
and alteration including oxidation. Logging is
considered sufficient to support geologic
modelling and Mineral Resource estimates.
Rock Quality Designation (RQD) and Rock
Mass Quality (RMQ) logs were kept for
geotechnical purposes only for purposely
designated geotechnical holes.
RC and diamond core logging is both qualitative
and quantitative in nature depending on the
feature being logged; geology, rock types,
alteration and structure are recorded based on
visual determination.
All diamond core is routinely photographed,
both wet and dry.
More than 90% of all drill holes were logged in
full regardless of mineralization.  Since 2007, all
holes have been routinely logged.
– IIIB-204 –
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Criteria Explanation Commentary
Sub-sampling
techniques and
sample preparation
If core, whether cut or sawn and whether quarter,
half or all core taken.
If non-core, whether riffled, tube sampled, rotary
split, etc. and whether sampled wet or dry.
For all sample types, the nature, quality and
appropriateness of the sample preparation
technique.
Quality control procedur es adopted for all sub-
sampling stages to maximize representivity of
samples.
Measures taken to ensure that the sampling is
representative of the in s itu material collected,
including for instance results for field
duplicate/second-half sampling.
Whether sample sizes are appropriate to the grain
size of the material being sampled.
Diamond core was cut in half using an
electrically powered diamond blade core saw in
competent ground and hand split in clay at
either 1 m intervals or to geological contacts.
Since March 2023, underground grade control
diamond drill core was sampled as whole core.
RC samples were collected from a cyclone and,
if dry, put through a three-stage riffle splitter for
a 12.5% sub-sample. A 3-5kg (1 m) sample was
collected into pre-numbered sample bags for
analysis. Before 2006, if RC samples were wet,
then sampling was by quartering. Due to
changing to diamond drilling, after 2006 wet RC
samples were no longer taken.
The RC and DD sample preparation techniques
are considered appropriate.
All samples contain a waterproof sample ID tag
in numbered calico bags and are weighed. The
samples were stacked and wrapped on a pallet
before being transported by truck to the
laboratory.
Industry standard diamond and RC drilling
techniques were used and are considered
appropriate for use in Mineral Resource
estimation.
Sample preparation is to industry standard
involving drying, crushing and pulverizing of the
entire sample from which a sub-sample using a
scoop is selected and stored in pulp packets.  A
30g subsample is selected from each pulp
packet for analysis.
For RC drilling, sample quality was maintained
by monitoring sample volume and by cleaning
the splitters, cyclones and hoses on a regular
basis.
Sub-sampling in the laboratory is only carried
out after size reduction in the grinding process.
Field duplicates were taken at 1 in 15 or 1 in 20
for RC drilling. Quarter splits of core have been
taken and recorded as duplicates in the
database.
– IIIB-205 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Criteria Explanation Commentary
Sample sizes are considered appropriate to the
gold mineralization based on the style of
mineralization (fine-grained gold with no visible
gold), the thickness and consistency of the
intersections, the sampling methodology, and
assay value ranges for gold.  This has been
checked during a separate gold deportment
study which examined the grain size distribution
and the liberation size.
Quality of assay
data and laboratory
tests
The nature, quality and appropriateness of the
assaying and laboratory procedures used and
whether the technique is considered partial or total.
For geophysical tools, spectrometers, handheld
XRF instruments, etc.,  the parameters used in
determining the analysis including instrument
make and model, reading times, calibrations
factors applied and their derivation, etc.
Nature of quality control procedures adopted (e.g.
standards, blanks, duplicates, external laboratory
checks) and whether acceptable levels of accuracy
(i.e. lack of bias) and precision have been
established.
Following sample preparation, a 110g pulp
aliquot for Au Fire Assay and 20g pulp aliquot
for ICP multi element was taken. The 20g pulp
aliquots were transported to other ALS
laboratories (usually ALS Brisbane) for ICP and
Lecco furnace analysis. The analytical
procedure is as follows:
If Au grade > 10g/t Au, re-assayed by Fire
Assay Gravimetric.
If Au grade > 0.4g/t Au, re-assayed using CN
Leachwell technique.
Detection limit for Fire Assay is 0.01ppm.
A multi-element suite (varying through time
from 30 – 40 elements, but always including Cu,
Ag, S, Mo) was analysed by ICP-AES.
The copper multi-element suite analysed by
ICP-AES (ALS laboratory code ME-ICP61)
contains Ag, Al, As, Ba, Be, Bi, Ca, Cd, Co, Cr,
Cu, Fe, Ga, K, La, Mg, Mn, Mo, Na, Ni, P, Pb,
S, Sb, Sc, Sr, Th, Ti, Tl, U, V, W and Zn.
Copper samples above 0.2% Cu are sent for
sequential copper analysis.
If Cu > 0.5% Cu, the sample was re-assayed
using an Ore Grade technique (either AAS or
diluted ICP). These methods are considered
total methods.
For some samples total sulphur, sulphide
sulphur, sulphate sulphur, total carbon,
carbonate carbon and organic carbon were
analyses by Lecco Furnace following
appropriate digestion, this sample selection is
based on a Cu trigger that has varied overtime.
– IIIB-206 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Criteria Explanation Commentary
The fire assay gold analysis undertaken is
considered to be a total assay method.
Multi-element analyses of 31 elements by four
acid digestion via ICP-AES are considered total
assay methods except where they exceed the
upper detection limit. In this case samples were
re-assayed using a four-acid digest with HCI
leach, and ICP-AES or AAS finish.
Leachwell assays are a partial assay method
used to estimate the pe rcentage of gold in
mineralisation recoverable in the standard CIL
plant.  This is supported by a separate gold
deportment study and is a suitable indicator of
gold recovery.
No geophysical tools, spectrometers, handheld
XRF instruments or similar tools were used for
assays included in the Sepon database.
Industry standard certified reference materials
(CRMs) including matrix matched and CRM’s
made from drill core supplied from the Sepon
mine were utilized to check laboratory assay
quality control. The insertion rate for CRMs is a
nominal 1 in 30, and 1/3 of CRMs are blanks.
Different CRMs have been selected for use at
varying gold grades over the life of the project.
The combined insertion rate of pulp blanks and
CRMs is a nominal 1 in 20 samples.
The QA/QC program includes CRMs, blanks,
preparation duplicates and field duplicates and
is acceptable according to industry standards.
Overall relative bias for the CRMs is within 5%
and is acceptable. The assay precision
determined from field duplicate samples was
found to be acceptable. Blank sample results do
not indicate any sample contamination issues.
Assay results are acceptable for use in
supporting Mineral Resource estimates.
At a minimum, every drill hole contains at least
one coarse blank, one pulp blank and one CRM
standard. At a minimum 1 in 15 samples is a
control sample (earlier programs vary from 1 in
25 to 3 in 25).
Checks of the laboratory results and data import
procedures are undertaken to identify any
– IIIB-207 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Criteria Explanation Commentary
spurious results for verification and re-assay.
Acceptable levels of accuracy and precision
have been established. Any suspect data is
excluded from the Mineral Resource estimate.
Independent / round robin laboratory checks
were conducted on a quarterly or half yearly
basis until 2010. The results were generally
unbiased with respect to each other.  Between
2010 and 2016, no independent laboratory
checks were undertaken, however since 2016,
an external umpire lab and round robin system
have been used to validate results.  To date
1841 samples have been sent for umpire
review.
In December 2015 a 3-month trial of the Sepon
lab was carried out, the results at that time
concluded that due to turnaround times, inability
to complete all desired analysis and higher
detection limits, the ALS lab would continue to
be used for Mineral Resource analysis.
However, Since August 2021, the Sepon Lab
has been used for all analysis including
resource samples.

Verification of
sampling and
assaying
The verification of significant intersections by either
independent or alternative company personnel.
The use of twinned holes.
Documentation of prima ry data, data entry
procedures, data verification, data storage
(physical and electronic) protocols.
Discuss any adjustment to assay data.
Intersections were reviewed by the senior
geologist or superintendent on-site following
receipt of the assay results.
Monthly internal reviews are carried out for all
assay batches returned. Any CRM samples that
exceed 3 standard deviations from the
expected value, or showing other issues such
as significant bias or trends will have its batch
returned for re-analysis.
Sample swaps, mislabeling and incorrect
control sample insertion related to human error
have been identified by checking procedures
and photos and are rectified.
There are no known deficiencies in the assay
data quality from ALS and Sepon laboratories
that affect the resource confidence.

Twinned or nearby holes have been undertaken
throughout the history of mining at Sepon. Most
– IIIB-208 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Criteria Explanation Commentary
holes provide reasonable agreement with pre-
existing drilling.
Some twinned diamond drill holes previously
found RC drilling in wet conditions to produce
variably smeared and positively biased results.
Areas affected by this occurrence have been
mined out and do not contribute to the current
Mineral Resource.  Current practice is only to
use DD in wet drilling conditions. RC drill holes
with suspected smearing have not been used in
the mineral resource estimation.
Several deep surface holes in the DSE UG
Mineral Resource were excluded from the
estimate where shorter holes drilled from
underground provided more accurate
positioning of the deposit.
Laboratory result files are directly uploaded into
the database with no manual data entry.
Below detection limit assay results are stored in
the database as the detec tion limit (negative)
with appropriate metadata. No other
modification of the assay results is undertaken.
All data is stored and validated within an
electronic database.
Drill collars and down-hole surveys are
recorded by company staff and entered into a
spreadsheet and then loaded into the database.
Assays from the laboratory are received and
loaded electronically.
No adjustments were made to assay values.
Where data was deemed invalid or unverifiable
it was excluded from the Mineral Resource
estimation.

Location of data
points
Accuracy and quality of surveys used to locate drill
holes (collar and down-hole surveys), trenches,
mine workings and other locations used in Mineral
Resource estimation.
Specification of the grid system used.
Quality and adequacy of topographic control.
Drill hole collars locations are located by
differential GPS or total station survey
instrument.
Downhole surveys have been carried out using
a variety of tools over the history of Sepon.
Magnetic based surveys: Eastman single-shot
cameras, Reflex EZ or Axis Magshot tools.
Surveys were taken at depths of 12 m, 30 m and
– IIIB-209 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Criteria Explanation Commentary
then every 30 m to the bottom of hole.
Additional surveys are carried out at the request
of the supervising geologist where significant
hole deviation is noticed.
North Seeking Gyro: Currently used in
preference for surface collared resource drill
holes.
All drill hole collars are converted from UTM /
India-Thai 1960 projection to SPG06 local grid
coordinate systems.
In 2008 a LiDAR (Light Detection and Ranging)
survey was completed providing an accurate
topographic surface. Drill hole collar locations
have been validated through a process of
database and spatial checking for both
historical and recent data and by comparing the
collar locations to the LIDAR topographic
surface.
Several holes were identified as having
suspected locations and resolved prior to
modelling of the data. Holes with collars above
the topography were excluded.
Data spacing and
distribution
Data spacing for reporting of Exploration Results.
Whether the data spacing and distribution is
sufficient to establish the degree of geological and
grade continuity appropriate for the Mineral
Resource and Ore Reserve estimation
procedure(s) and classifications applied.
Whether sample compositing has been applied.
Resource drill hole spacing varies from less
than 25m up to 100m to centres.
Drill spacing is adequate to define the
geological and grade continuity for Mineral
Resource estimation. Classification has
considered data qual ity, drill spacing,
geological continuity and production data.
DD samples are not composited prior to being
sent to the laboratory.  RC samples are 1m
intervals but compositing up to 4m has occurred
in the past in areas known to be waste.
Sample lengths within the database are not
composited.
Compositing as part of the estimation process
has been undertaken in the modelling software
(Vulcan or Leapfrog).  Composite lengths
selected were set to 1-metre which is
comparable to the actual sample length.
Composited data was then used for statistical,
geostatistical and estimation purposes.
– IIIB-210 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Criteria Explanation Commentary
Orientation of data
in relation to
geological structure
Whether the orientation of sampling achieves
unbiased sampling of possible structures and the
extent to which this is known, considering the
deposit type.
If the relationship between the drilling orientation
and the orientation of key mineralised structures is
considered to have introduced a sampling bias, this
should be assessed and reported if material.
Drill orientation varies by year drilled and
location within the deposit.
Geological mapping and interpretation show
that mineralisation generally strikes 060⁰ - 090⁰
(deposit dependent); hence drilling is
conducted on north -south sections to intersect
the mineralised zone at a high angle. Most drill
holes dip -60⁰ to -90⁰, depending on the
expected dip of the target mineralisation and
surface site access for drill pads.
In parts of the project area, drill holes were
drilled at -60⁰ along 090⁰ or 270⁰ from 50m
spaced sections in order to reduce the need for
vegetation clearance and ground disturbance in
areas of extremely steep topography.
Drilling orientation is not considered to have
introduced any sampling bias. This has been
confirmed through variogram reviews using the
varying orientation data.
No orientation-based sampling bias has been
identified to date in the data.
Sample security The measures tak en to ensure sample security.
Adequately trained and supervised sampling
personnel, with monthly inspections and
verification of training.
Core yard facility with security fence, security
guards and well-maintained sampling sheds.
Cut core is sampled and stored in calico bags
tied and clearly numbered in sequence using a
tear-resistant, waterproof, pre-printed tag.
Calico sample bags are transported on
wrapped pallets to the assay laboratory.
The laboratory checks sample dispatch
numbers against submission documents,
advises of any discrepancies, and signs off on
receipt of each batch.
Sample bags are photographed prior to
shipment
Assay data returned separately in both
spreadsheet and PDF formats.
Audits or reviews The results of any audits or reviews of sampling
techniques and data.
No recent audits or reviews have been
undertaken.
– IIIB-211 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Criteria Explanation Commentary
Historic reviews include the following:
A review of assay services involving a trial of
the Sepon Laboratory for Resource sample
analysis was undertaken in 2015-2016. All
samples >=0.2% Cu and QAQC samples were
sent to ALS laboratory for comparison during
the trial period. The decision was made to
remain with ALS laboratory on the basis of
available analytical methods, better QA/QC
results and turn-around time.
REFLEX Geochemistry completed a QC review
on data from 1 January 2011 – 31 May, 2014.
The conclusions indicate that the control
samples have provided a satisfactory guide to
the accuracy and precision of the analyses.
Procedures have not significantly changed
since then.
The ALS laboratory in Vientiane has been
audited on a quarterly basis by site personnel.
No material issues hav e been identified at the
laboratory.
The ALS laboratory in Brisbane was audited in
March 2016 by MMG Resource estimation
personnel.  No material issues were identified.
In 2008 a QC review of assay data at the
Thengkham South deposit and Phabing area
was undertaken (Hackman & Associates) and
found that there were no obvious grade biases
in the dataset, there were however quality
discrepancies that required follow up. These
have been addressed.
A 2008 external audit (IO Global) of the
database found post-2006 analytical data to be
of appropriate integrity.
In 2007 a twin drill hole study undertaken by QG
comparing RC samples to DD samples, found
that the use of all the av ailable RC drilling is
likely to be biased and overestimate tonnes
above a gold cut-off. This was due to the
presence of wet RC samples. Measures have
been taken since this report to exclude wet RC
samples from the estimate.


– IIIB-212 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Section 2: Reporting of Exploration Results
(Criteria listed in the preceding section also apply to this section.)
Criteria Explanation Commentary
Mineral tenement
and land tenure
status
Type, reference name/num ber,  location and
ownership including  agreements or material
issues with third parties  such as joint ventures,
partnerships, overriding royalties, native title
interests, historical site s, wilderness or national
park and environmental settings.
LXML Mineral Resources are located within
the bounds of the Mineral Exploration and
Production Agreement (MEPA), a direct
agreement with the Laos Government. The
MEPA provides for exploration, development
and extraction of any Mineral Resources
discovered.
The MEPA provides for exploration,
development and extraction of any Mineral
Resources discovered. The Sepon MEPA
occupies portions of both Savannakhet
Province, and Khammouane Province to the
immediate north.
The Sepon MEPA origin ally occupied 5212
km2. Various relinquishments have occurred
since it was granted in 1993, the most recent
relinquishment in early 2005 has resulted in
the current retained area of 1247 km².
A royalty is payable to the Government of
Laos, representing 4.5 % of the FOB value
of minerals received by LXML. The Lao
Government also owns a 10% share in
LXML. Tenement rental is payable at
US$500 per square kilometer per annum (for
operational and mining areas) in accordance
with Annex D of the MEPA. Taxes and other
obligations are set out in Article 13 of the
MEPA.
The operating period in accordance with the
MEPA is thirty (30) years, from
commencement of operations. As defined in
Article 10, Paragraph 2 of the MEPA for
Sepon Gold Stage 1, the operating period
commenced on 1 March 2003.
The terms of the agreement provide for the
right to apply for two extensions of the
operating period with each extension for a
period of 10 years.
There are no known impediments to
operating in the area.
The licenses are in good standing with no
known impediment to the
– IIIB-213 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Criteria Explanation Commentary
granted mining permit.
The security of the tenure held at the time of
reporting along with any known impediments to
obtaining a licence to operate in the area.

Exploration done by
other parties
Acknowledgment and appraisal of exploration by
other parties.
CRA Exploration first identified the Sepon
Mineral District as an area of interest in 1990
and formed Lane Xang Minerals Limited
(LXML) as holder of the MEPA.
Between 1995 and 1999 RTZ (RTZ was
formed from the merger of CRA and Rio
Tinto in 1997) discovered and defined
several gold only Mineral Resources and
copper and gold Mineral Resources at the
Khanong prospect.
Oxiana became manager of the Sepon
Project in 2000 through the purchase 80% of
LXML before later buying the remaining 20%
interest from RTZ. The Laos Government
exercised its option to acquire a 10% interest
in LXML in 2006.
In 2008 Oxiana merged with Zinifex Ltd to
form OZ Minerals.
In 2009 MMG acquired LXML from OZ
Minerals.
In 2018, Chifeng acquired the majority
ownership of LXML from MMG
The Sepon exploration and resource
geology groups have been maintained
throughout the OZ Minerals, MMG and
Chifeng takeovers.
Geology Deposit type, geological setting and style of
mineralisation.
The Sepon project area is situated near the
eastern margin of the intra-continental
Khorat Basin and on the western flank of the
Anamite Range fold belt. It lies within the
Troungson geological region covering a
broad spectrum of rocks ranging in age from
Upper Proterozoic to Jurassic. The regional
geology is dominated by an Upper
Palaeozoic sedimentary belt of arkosic and
feldspathic sandstone, variably calcareous
– IIIB-214 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Criteria Explanation Commentary
and carbonaceous siltstone, shale and
limestone which is variably dolomitized and
locally marble. There are lesser volcanic
rocks, typically comprised of agglomerate,
conglomerate, tuffaceous sandstone, and
rare coherent volcanics. The belt is cut by
plutonic to sub-volcanic bodies of granite,
monzodiorite, granodiorite, quartz porphyry,
rhyodacite porphyry (RDP) and andesite
porphyry. The intrusive rocks are
preferentially emplaced along either east or
north-west trending well-developed
structures.
Several styles of mineralisation have been
recognised within the Sepon Mineral District:
porphyry-like Cu-Mo-Au mineralisation,
skarnoid Cu-Mo-Au mineralisation adjacent
to porphyry intrusive, distal skarn related Cu-
Au-Ag+/- Pb+/-Zn massive sulphide veins,
Carlin type carbonate hosted gold
mineralisation and carbonate hosted
Mississippi Valley type Pb-Zn-Ag
mineralisation. In addition, weathering and
supergene re-mobilisation has created
supergene copper, exotic supergene
copper, oxide gold and alluvial gold in karst
fill deposits.
Gold mineralisation mostly occurs in the fault
zones and adjacent to the fault zones at the
contact between the dol omite of the Nalou
formation and the overlying shales and
nodular carbonate of the Discovery
Formation. Mineralisation occurs in
association with decalcification and partial
silica replacement of calcareous mudstones,
and typically is best developed within the
Discovery formation. But can also occur as a
karst-controlled residual or collapse breccia
deposit within the underlying Nalou
formation, with mineralised jasperoid
boulders occurring within a matrix of
decomposed rock and clays. Regional
WNW-striking, steeply NNE-dipping normal
faults are believed to have been the major
pathway for ascending mineralizing fluids.
Primary gold mineralisation occurs as Carlin
style gold forming distally to the copper skarn
systems. Mineralisation occurs in
– IIIB-215 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Criteria Explanation Commentary
association with decalcification and partial
silica replacement of calcareous mudstones
(‘jasperoid’) along steep faults and is
typically best developed at the contact of the
Nalou Formation (dolomite) and the
overlying Discovery Formation (nodular calc-
shale).
Oxide gold mineralisation shows further
control by weathering processes with very
high-grade zones developed as karst fill
(mineralised jasperoid boulders occurring
within a matrix of decomposed rock and
clays) on chemically weathered carbonate
rocks.
Copper mineralisation is associated with
nearby skarn-hosted intrusives. Copper has
subsequently migrated to the peripheries of
the intrusive centre and concentrated
through a supergene process.
Drill hole Information
A summary of all information material to the
understanding of the exploration results including
a tabulation  of the following information  for all
Material drill holes:
Due to the advanced nature and extensive
drilling completed for this project, no
individual drill hole is material to the Mineral
Resource estimate and hence this
geological database is not supplied.
easting and northing of the drill hole collar
elevation or RL (Reduced Level – elevation
above sea level in metres) of the drill hole collar
dip and azimuth of the hole
down hole length and interception depth
Hole length.
If the exclusion of this information is justified on
the basis that the information  is not Material and
this exclusion  does not detract from the
understanding of the report, the Competent
Person should clearly explain why this is the
case.
Data aggregation
methods
In reporting Exploration   Results, weighting
averaging techniques, maximum and/or
minimum grade truncations (e.g. cutting of high
grades) and cut-off grades are usually Material
and should be stated.
This is a Mineral Resource Statement and is
not a report on exploration results hence no
additional information is provided for this
section.
– IIIB-216 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Criteria Explanation Commentary
Where aggregate intercept s incorporate short
lengths of high-grade results and longer lengths
of low grade results, the procedure used for such
aggregation should be stated and some typical
examples of such aggregations should be shown
in detail.
This is a Mineral Resource Statement and is
not a report on exploration results hence no
additional information is provided for this
section.
No metal equivalent values have been used.
The assumptions used for any reporting of metal
equivalent values should be clearly stated.

Relationship
between
mineralisation
widths and intercept
lengths
These relationships are particularly important in
the reporting of Exploration Results.
Mineralisation true widths are captured by
interpreted mineralisation 3D wireframes.
Most drilling was at -60° to -90° dip angles in
order to maximise exposure to the true width
of intersections.
Geometry of mineralisation is interpreted as
sub-horizontal in the supergene and sub-
vertical in the hypogene material and as
such current drilling allows true width of
mineralisation to be determined.
If the geometry of the mineralisation with respect
to the drillhole angle is known, its nature should
be reported.
If it is not known and only the down hole lengths
are reported, there should be a clear statement
to this effect (e.g. ‘down hole length, true width
not known’).
Diagrams
Appropriate maps and sections (with scales) and
tabulations of intercepts should be included for
any significant discovery being reported These
should include, but not be limited to a plan view
of drill hole collar locations and appropriate
sectional views.
A drill collar location plan and geological
sections are not included, as the Project is
an operating mine, and not an exploration
discovery.  A summary geological map of the
Sepon Mineral District and a generalized
east - west cross section of Sepon deposit
are provided to illustrate the gold
mineralization style at Sepon.
Balanced reporting
Where comprehensive reporting of all Exploration
Results is not practicable, representative
reporting of both low and high grades and/or
widths should be practiced to avoid misleading
reporting of Exploration Results.
This is a Mineral Resource Statement and is
not a report on exploration results hence no
additional information is provided for this
section.
Other substantive
exploration data
Other exploration data, if meaningful and
material, should be reported including (but not
limited to): geological observations; geophysical
survey results; geochemical survey results; bulk
samples  – size  and method of treatment;
metallurgical test results;  bulk density,
groundwater,  geotechnical and rock
characteristics; potent ial  deleterious or
contaminating substances.
This is a Mineral Resource Statement and is
not a report on exploration results hence no
additional information is provided for this
section.
This is a Mineral Resource Statement and is
not a report on exploration results hence no
additional information is provided for this
section.
Further work
The nature and scale of planned further work
(e.g. tests for lateral extensions or depth
extensions or large-scale step-out drilling).
Mining activities at all deposits as and when
scheduled require additional infill drilling as
part of grade control work to deliver the
– IIIB-217 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Criteria Explanation Commentary
Diagrams clearly highlighting the areas of
possible extensions, including the main
geological interpretations and future drilling
areas, provided this information is not
commercially sensitive.
required definition for detailed mine design
and mining extraction.
Mineral Resource definition drilling is also
planned within most deposits to improve
geological confidence and support the
ongoing conversion of Inferred and Indicated
Mineral Resources to higher classifications.
Exploration drilling from October 2022 to
September 2023 has successfully delivered
new Mineral Resources at:
Ban Mai
Ban Non
Nakachan
Khanong Primary Copper (underground)
Discovery West Underground
And extended Mineral Resources at:
Discovery East Underground, and
Nalou
Exploration drilling beyond 2023 is planned
to focus on target around Discovery West,
Discovery East Underground Thenkham and
other nearby tenements.


– IIIB-218 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Section 3: Estimation and Reporting of Mineral Resources
(Criteria listed in section 1, and where relevant in section 2, also apply to this section.)
Criteria Explanation Commentary
Database integrity
Measures taken to ensur e that data has not
been corrupted by, for example, transcription or
keying errors, between its initial collection and
its use for Mineral Resource estimation
purposes.
Data validation procedures used.
A digital field logging system (with lookups and
referential integrity (RI)) or paper-based system
for exploration both transferring to a data entry
database (DataEntryDB ), (with lookups and
further RI) then transferring to the master
database (LaosDB) where assays are loaded
and approved.
A senior geologist reviews all new drill data
logged in exploration logging view and sign off
occurs after all corrections are made prior to
loading into LaoDB which is done via SQL Server
with stored procedures t o detect and hold any
errors on import.
Micromine Geobank software provides a front
end to an SQL database for the Mineral
Resource and grade control data. Analytical data
is uploaded directly from laboratory SIF files.
The measures described above ensure that
transcription or data entry errors were
minimized.
Validation routines by database personnel check
for overlapping sample depths, lithological and
alteration information, as well as reject criteria
such as logging information past EOH depth.
Further validation is performed in Leapfrog
software once the databas e is imported during
the modelling process.  Any errors flagged are
fixed in the database then the data is reimported
into Leapfrog.
Data used in the Mineral Resource has passed
several validation ch ecks both visual and
software related prior to use in the Mineral
Resource.
The gold database used in the Mineral Resource
is a merger of several databases and represents
the best data for the gold mineral resources,
which is separate to the master database.
Several major data transfers, with inherent risks,
have occurred over the life of the project, several
suspect holes (assays) exist within the master
drill hole database. Further work is required to
verify and update the master database.
– IIIB-219 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Criteria Explanation Commentary
There is spatial confidence in the occurrence of
gold grades, however the accuracy of those
grades is unknown.
The database currently being used in the gold
estimates is deemed to be appropriate for an
Indicated Mineral Resource.
Site visits
Comment on any site visits undertaken by the
Competent Person and t he outcome of those
visits.
If no site visits have been undertaken indicate
why this is the case.
Dr. Anson Xu and Dr. Tony Guo from SRK team
visited the Sepon property from 8 December
2022 to 14 December of 2022

Geological
interpretation
Confidence in (or conversely, the uncertainty of
the geological interpretation of the mineral
deposit.
Nature of the data used and of any assumptions
made.
The effect, if any, of alternative interpretations
on Mineral Resource estimation.
The use of geology in guiding and controlling
Mineral Resource estimation.
The factors affecting c ontinuity both of grade
and geology.
Prior to Mineral Resource estimation an
underlying three-dimensional geological model
(stratigraphy, structure and intrusives) was made
for all deposits. All domains used for estimation
were interpreted using known controls on the
domain variable with the geological model as a
framework. For example, the gold grade
domains, whilst interpreted at a nominal gold
grade, follow favorable stratigraphic contacts
and controlling fault structures. Confidence in the
geological (domain) interpretation for all Sepon
Mineral Resource estimates is high.
Geological models were interpreted from logged
drilling data and deposit scale surface geological
mapping.
If new drill programs contradict the geological
model, the model is updated to reflect new drill
data.
The geological continuity of mineralisation and
mineralogy is a key input into Mineral Resource
classification and targeted drilling has been
conducted to ensure geological continuity rather
than solely exploring for mineralised continuity.
Sepon hosts several deposit along a 14km long
belt of carbonaceous ro cks. Typical widths of
Sepon deposits range from five to thirty-five
metres wide and all have surface expressions.
The current Mineral Resource has been
simplified from previous years where deposits
were split and modelled separately, for example,
Discovery West and Discovery East is now
– IIIB-220 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Criteria Explanation Commentary
modelled in a single Discovery model whilst
Nalou, Namkok East and Namkok West have
similarly been merged to form a single model as
they are geologically continuous across the span
of the model with interaction between controlling
structures.
Dimensions
The extent and variability of the Mineral
Resource expressed as length (along strike or
otherwise), plan width, and depth below surface
to the upper and lower limits of the Mineral
Resource.

Estimation and
modelling techniques
The nature and appropriateness of the
estimation technique(s) applied and key
assumptions, including treatment of extreme
grade values, domaining, interpolation
parameters and maximum distance of
extrapolation from data points. If a computer
assisted estimation method was chosen include
a description of computer software and
parameters used.
The availability of check estimates, previous
estimates and/or mine production records and
whether the Mineral Resource estimate takes
appropriate account of such data.
The assumptions made regarding recovery of
by-products.
Estimation of deleterious elements or other non-
grade variables of economic significance (e.g.
sulphur for acid mine drainage
characterisation).
In the case of block model interpolation, the
block size in relation to the average sample
spacing and the search employed.
Any assumptions behind modelling of selective
mining units.
Any assumptions about correlation between
variables.
Description of how the geological interpretation
was used to control the resource estimates.
Discussion of basis for using or not using grade
cutting or capping.
Mineral Resource estimation was undertaken in
Leapfrog Edge and Vulcan mining software with
the following key assumptions and parameters:
Ordinary Kriging interpolation has been applied
for the estimation of Cu,  Au, Ag, Ca, Mg, Mn,
Total S, Total C, and PRI are also estimated in
the gold models. Inverse distance to the power
of two interpolation has been applied where
there was insufficient data to model spatial
continuity for kriging weights within the gold
block model estimates.  This is considered
appropriate for the estimation of Mineral
Resources at Sepon.
Extreme grade values were managed by upper
grade capping. The typical upper cap used is the
99th percentile to contain outliers.
The estimates of gold were predominantly
undertaken using hard domain boundaries and a
series of elliptical sear ch passes orientated in
the plane of mineralisation. These search
orientations and sizes were supported by
variogram analysis.
A composite length of 1m downhole was chosen
and the compositing process validated.
Exploratory data analysis, variography and
search neighborhood optimization for each
domain was performed.
Total sulphur and carbon are estimated to assist
with gold speciation and in the Mineral Resource
estimation was undertaken in Leapfrog Edge
and Vulcan mining software with the following
key assumptions and parameters:
– IIIB-221 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Criteria Explanation Commentary
The process of validation, the checking process
used, the comparison of model data to drill hole
data, and use of reconciliation data if available.
Ordinary Kriging interpolation has been applied
for the estimation of Cu,  Au, Ag, Ca, Mg, Mn,
Total S, Total C, and PRI are also estimated in
the gold models. Inverse distance to the power
of two interpolation has been applied where
there was insufficient data to model spatial
continuity for kriging weights within the gold
block model estimates.  This is considered
appropriate for the estimation of Mineral
Resources at Sepon.
Extreme grade values were managed by upper
grade capping. The typical upper cap used is the
99th percentile to contain outliers.
The estimates of gold were predominantly
undertaken using hard domain boundaries and a
series of elliptical sear ch passes orientated in
the plane of mineralisation. These search
orientations and sizes were supported by
variogram analysis.
A composite length of 1m downhole was chosen
and the compositing process validated.
Exploratory data analysis, variography and
search neighborhood optimization for each
domain was performed.
Total sulphur and carbon are estimated to assist
with gold speciation and in the determination of
the primary domain.
The minimum and maximum number of
composites allowable to interpolate a block was
typically set at 4-10 and 15-24 based on KNA.
Octant searches were used for the first two
passes for ancillary elements only.
No assumptions about the recovery of by-
products have been made.
Parent block sizes are 15m x6m x 5m (XYZ). The
parent block size has considered: data spacing,
mining methods and variography. Sub-blocks
honoring relevant shapes and surfaces were
used. The parent block size delineates
mineralized zones without compromising the
block variance.
– IIIB-222 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Criteria Explanation Commentary
Search distances in general for most estimates
are the length of the first variogram structure in
pass 1 and doubled in subsequent passes.
Larger passes were used to interpolate less well-
informed blocks.
No further assumptions have been made
regarding modelling of selective mining units.
Block models are validated by: Visual
inspections for true fit with the high and low
grade wireframes (to check for correct
placement of blocks and sub-blocks), block
model to wireframe volume differences are
checked, visual comparison of block model
grades against composite file grades, global
statistical comparison of the estimated block
model grades against the composite statistics
and raw data, global and local (on key sections)
swath plots are used to check for bias.
determination of the primary domain
Moisture Whether the tonnages estimated on a dry basis
or with natural moisture, and the method of
determination of the moisture content.
The tonnages are estimated on a dry basis.
Cut-off parameters The basis of the adopted cut-off grade(s) or
quality parameters applied.
For OP Au the Mineral Resources are reported
at a cut-off grade of 0.6 g/t Au of oxidized gold
ore and a cut-off grade of 1.5 g/t Au of primary
gold ore.
For UG Au the Mineral Resources are reported
at a cut-off grade of 3 g/t Au of primary gold ore.
For OP Cu the Mineral Resources are reported
at a cut-off grade of 1.1% Cu of oxidized copper
ore and a cut-off grade of 0.5 % Cu of primary
copper ore.
For UG Cu the Mineral Resources are reported
at a cut-off grade of 0.8% Cu of oxidized copper
ore.

– IIIB-223 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Criteria Explanation Commentary
Mining factors or
assumptions
Assumptions made regarding possible mining
methods, minimum mining dimensions and
internal (or, if applicable, external) mining
dilution. It is always necessary as part of the
process of determining reasonable prospects
for eventual economic extraction to consider
potential mining methods, but the assumptions
made regarding mining methods and
parameters when estimating Mineral Resources
may not always be rigorous. Where this is the
case, this should be reported with an
explanation of the basis of the mining
assumptions made.
Sepon is an active open pit and underground
mining operation and mining methods, minimum
mining widths and internal dilution is well
understood and documented on site.
conceptual pit shells.  Underground Mineral
Resources are reported within mineable panels
based on long-term plan shapes and or Mine
Stope Optimizer (MSO) shapes.  The assists in
demonstrating that the Mineral Resource meets
the requirement of having reasonable prospects
for eventual economic extraction criteria.
Metallurgical factors
or assumptions
The basis for assumptions or predictions
regarding metallurgical amenability. It is always
necessary as part of the process of determining
reasonable prospects for eventual economic
extraction to consider potential metallurgical
methods, but the assumptions regarding
metallurgical treatment processes and
parameters made when reporting Mineral
Resources may not always be rigorous. Where
this is the case, this should be reported with an
explanation of the basis of the metallurgical
assumptions made.
Sepon Gold Mine and Copper Mine is a
production project, both metallurgical testing and
historical production performance data are
available, providing reliable data to Metallurgical
Factors.
The oxide gold ore is amenable to CIL process,
final product is Gold Doré. The gold recovery
ranges from 51.8% to 68.9% in actual
production.
The primary gold ore is amenable to the process
of flotation-POX-CIL, final product is Gold Doré.
The gold recovery ranges from 78% to 85% in
laboratory tests.
The oxide copper ore is amenable to the process
of sulfuric acid leaching-SX/EW, the copper
recovery ranges from 62% to 78% in actual
production.
The primary copper ore is amenable to flotation
process, final product is copper concentrate. The
concentrate grade and copper recovery are
affected by the sulphur grade and ASCu/TCu
ratio. A general copper recovery of 80% can be
achieved.
Environmental factors
or assumptions
Assumptions made regarding possible waste
and process residue disposal options. It is
always necessary as part of the process of
determining reasonable prospects for eventual
economic extraction to consider the potential
environmental impacts of the mining and
processing operation. While at this stage the
determination of pot ential environmental
impacts, particularly for a greenfields project,
See Section 18.
– IIIB-224 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Criteria Explanation Commentary
may not always be well advanced, the status of
early consideration of these potential
environmental impacts should be reported.
Where these aspects have not been considered
this should be reported with an explanation of
the environmental assumptions made.
Bulk density Whether assumed or determined. If assumed,
the basis for the assumptions. If determined, the
method used, whether wet or dry, the frequency
of the measurements, t he nature, size and
representativeness of the samples.
The bulk density for bulk material must have
been measured by methods that adequately
account for void spaces (vugs, porosity, etc),
moisture and differences between rock and
alteration zones within the deposit.
Discuss assumptions for bulk density estimates
used in the evaluation process of the different
materials.
Samples for bulk density determination are taken
from diamond drill core every 6 m using the wax
coated core immersion method.
The bulk density determinations were estimated
into the block models by either ordinary kriging,
or where limited data exists as direct assignment
from average values. All estimates are based on
oxide vs primary division and then further on
lithology.
Previous reconciled mined gold ore tonnages
demonstrate these values are robust in the oxide
zones.  Previous models created using the same
method have been proved accurate by
reconciliation of actual versus mine claim.
Classification The basis for the classification of the Mineral
Resources into varying confidence categories.
Whether appropriate account has been taken of
all relevant factors (ie relative confidence in
tonnage/grade estimations , reliability of input
data, confidence in continuity of geology and
metal values, quality, quantity and distribution of
the data).
Whether the result appropr iately reflects the
Competent Person’s view of the deposit.
Mineral Resource classification is directly linked
to the geological confidence based on drill hole
spacing, degree of variability of shape and grade
of mineralization and associated geological units
and structures.   Each mineral deposit has been
reviewed separately.  Unless an entire deposit or
area was classified at a uniform level, then
wireframes of classification where applied to
demarcate the classification.
Measured Mineral Resources include materials
that have been grade cont rolled, having drilling
that is spaced approximately 15m or less, and
exhibits low levels of variability in shape (volume
and tonnes), and grade.  This confidence is
sufficient to confirm geological and grade
continuity of the mineralisation and supports
detailed mine planning.
Indicated Mineral Resources include materials
that have drill spacing up  to 50m with multiple
intersections on each section and consistency of
size and grade of mineralised intersections
sufficient to assume geological and grade
continuity, and to support mine planning and
evaluations of economic viability.
– IIIB-225 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Criteria Explanation Commentary
Inferred Mineral Resources include materials
with a drill spacing up to 100m showing
mineralisation in several holes on each section
over several sections.  Mineralising shape and
grade may be variable between holes and
sections.  Evidence is sufficient to imply
geological and grade continuity, and it is
expected that with additional exploration that the
majority of the resource would upgrade to
Indicated Mineral Resources.
In the Competent Person’s view the
classification is appropriate to the deposits at
Sepon given the available data for estimation.
Audits or reviews. The results of any audits or reviews of Mine ral
Resource estimates.
The input data, including geological mapping
and drillhole data are comprehensive in their
coverage of the mineralisation.
The Mineral Resource estimate appropriately
reflects the view of the Competent Person.
The relative accuracy of the Mineral Resource
estimate is reflected in the reporting of the
Mineral Resource as per the guidelines of the
JORC Code.
The statement relates to global volumetric
estimates.


– IIIB-226 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Section 4: Estimation and Reporting of Ore Reserves
(Criteria listed in section 1, and where relevant in sections 2 and 3, also apply to this section.)

Criteria Explanation Commentary
Mineral Resource
estimate for conversion
to Ore Reserves
Description of the Mineral Resource estimate
used as a basis for the conversion to an Ore
Reserve.
The Ore Reserves estimate is based on the
Mineral Resource model developed by LXML,
which was subsequently reviewed by an SRK
geologist. Inferred Resources have been
excluded from this estimate.
The Ore Reserves are reported inclusive of
Mineral Resources.
Clear statement as to whether the Mineral
Resources are reported additional to, or
inclusive of, the Ore Reserves.
For Open Pit Mining, the Ore Reserves estimate
is derived from pit optimization and pit design,
accounting for mining dilution and loss. The
reference point for the Ore Reserves estimates is
the ROM Pad before the primary crusher and/or
stockpiles at the processing and/or
hydrometallurgy plant.
For Stockpiles, the Ore Reserves estimate is
derived from data provid ed by LXML, which has
been reviewed by SRK. This review includes a
detailed summary of the data and production
records, particularly the feed grade. The
reference point for the Ore Reserves estimates is
within the stockpiles before processing and/or the
hydrometallurgy plant.
For Underground Mining, the Ore Reserves
estimate is derived from  stope optimization and
underground design, accounting for mining
dilution and loss. The reference point for the Ore
Reserves estimates is the ROM Pad before the
primary crusher and/or stockpiles at the
processing and/or hydrometallurgy plant.
Site visits
Comment on any site visits undertaken by the
Competent Person and the outcome of those
visits.
SRK engineers, including specialists in geology
discipline, visited the site in December 2022.
SRK engineers, including specialists in mining
and geology disciplines, visited the site in
December 2023.
SRK engineers, including specialists in mining,
processing, geology, and environmental
disciplines, visited the site in May 2024.
If no site visits have been undertaken indicate
why this is the case.
– IIIB-227 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Criteria Explanation Commentary
Study status
The type and level of study undertaken to
enable Mineral Resources to be converted to
Ore Reserves.
Sepon Gold Project Study (“SGPS”) revised by
AMC Consultants Pty Ltd (“AMC”) on 18 March
2020.
The LXML project encompasses gold and copper
open-pit mining operations that have been active
since the beginning of the 21st century. LXML has
been overseeing the mine's operations since
2018. In 2021, LXML discontinued copper open-
pit mining activities. In 2022, LXML commenced
gold underground mining operations. Presently,
the processing plants are engaged in processing
gold extracted from open pits, underground
sources, and stockpiles, as well as oxide copper
from historical stockpiles. The operating
practices, data, and records available are
considered to be at a Pre-Feasibility Study (PFS)
level, providing a reasonable basis for
assessment.
After reviewing the feasibility study and operating
data, SRK opines that the project could meet the
international PFS level in general and could serve
as a basis for Ore Reserves conversion.
The Code requires that a study to at least Pre-
Feasibility Study level has been undertaken to
convert Mineral Resources to Ore Reserves.
Such studies will have been carried out and will
have determined a mine plan that is technically
achievable and economically viable, and that
material Modifying Factors have been
considered.
The feasibility study, operational data, and
production plan form the basis for Ore Reserves
conversion.
Cut-off parameters The basis of the cut-off grade(s) or quality
parameters applied.
The ORE is defined as the three main types as
practical for the treatment flowsheet, by LXML.
Gold processing plant:
Oxide gold
Primary gold
Copper hydrometallurgical plant:
Oxide copper
The marginal cut-off grade (MCOG) is applied for
review the cut-off grades.
The costs are based on LXML’s operation records
with SRK’s analysis.
– IIIB-228 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Criteria Explanation Commentary
For gold processing: the processing costs are
USD17.0 per ton milled and USD 55.0 per ton
milled for oxide gold and primary gold
respectively.
For gold mining costs: the underground mining
cost is USD 35.0 per ton mined.
For the general & administrative costs are USD
9.0 per ton milled.
The reference gold and copper metal prices are
USD 2,050 per ounce and USD 8,300 per ton,
respectively. Those prices were based on the
HSBC long-term forecast price and CMF long
term price forecasting, released in 2024Q3.
The processing recovery is considered the
production data as 65% and 45% for gold and
copper, respectively.
The MCOG is estimated to be 0.6 g/t oxide gold
and 1.5 g/t primary gold for open pit mining and
gold stockpiles, which differ from the ore types
applied by LXML. The MCOG for underground
mining is estimated to be 2.6 g/t for primary gold,
which is lower than the 2.9 g/t applied by the mine.
The MCOG is estimated to be 0.9% oxide copper
for copper stockpiles, which differs from the ore
types applied by LXML.
The Ore Reserves were reported based the
SRK’s MCOG estimation.
Mining factors or
assumptions
The method and assumptions used as reported
in the Pre-Feasibility or Feasibility Study to
convert the Mineral  Resource to an Ore
Reserve (i.e. either by application of
appropriate factors by optimisation  or by
preliminary  or detailed design).
For gold open-pit mining, the detailed design
provided by LXML was used as the estimation
boundary. For gold underground mining, Stope
Optimization was carried out in alignment with
LXML’s input parameters as the estimation
boundary.
For gold deposits, all deposits with estimated Ore
Reserves are currently under operation. There
are associated designs for both open pit and
underground mining.For gold underground
mining, AMC completed a scoping-level
geotechnical assessment to estimate stable stope
spans and pillar dimensions for the DSE UG
The choice, nature  and appropriateness of the
selected mining method (s) and other mining
parameters including associated design issues
such as pre-strip,  access, etc.
The assumptions made regarding geotechnical
parameters (e.g. pit slopes, stope sizes, etc.),
grade control and pre-production drilling.
– IIIB-229 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Criteria Explanation Commentary
The major assumptions made and Mineral
Resource model used for pit and stope
optimisation (if appropriate).
deposit. The limiting stope span was assessed to
be the hanging wall or crown of the stope with a
hydraulic radius (HR) limit of 5.7. MEC conducted
an audit of the geotechnical aspects for DSE UG
and concluded that geotechnical risks are well
managed in LXML.
The major assumption proposed is that backfilling
will be applied for gold underground mining, which
is expected to increase mining recovery.
For gold open-pit mining, the dilution factor is
7.5%, consistent with LX ML's estimate. For gold
underground mining, the dilution factor is 15%,
also consistent with LXML's estimate.
For gold open-pit mining, the recovery factor is
95.0%, consistent with LXML's estimate. For gold
underground mining, the recovery factor is 95.0%
higher than LXML's estimate after reviewing the
reconciliation data.
For gold open pit mining, the minimum mining
width is 25.0 meters.
No Inferred Mineral Resources are included in the
Ore Reserves.
Historically, LXML has approximately 20 years of
production, and various facilities are well
developed. A 220 KV power line traverses the
area and supplies electricity. Telephones and
mobile communication are also available.
The mining dilution factors used.
The mining recovery factors used.
Any minimum mining widths used.
The manner in which Inferred Mineral
Resources are utilised in mining studies and the
sensitivity of the outcome to their inclusion.
The infrastructure requirements of the selected
mining methods.
Metallurgical factors or
assumptions (Coal
Preparation and Coal
Quality)
The metallurgical process proposed and the
appropriateness of that process to the style of
mineralisation.
Whether the metallurgical process is well-
tested technology or novel in nature.
The nature, amount and r epresentativeness of
metallurgical test work undertaken, the nature
of the metallurgical domaining applied and the
corresponding metallurgical recovery factors
applied.
Any assumptions or allowances made for
deleterious elements.
The existence of any bulk sample or pilot scale
test work and the degree to which such samples
Sepon Gold Mine is a production project, both
metallurgical testing and historical production
performance data are available, providing reliable
data to Metallurgical Factors.
The gold ore, both oxide and primary, is
refractory. The oxide gold ore is amenable to CIL.
The gold recovery ranges 51.8% to 68.9% in
historical production.
Flotation-POX-CIL proce ss is applied to treat
primary gold ore for producing Gold Doré. The
gold recovery ranges 55% to 67% in historical
production
The oxide copper ore is amenable to the process
of sulfuric acid leaching-SX/EW, the copper
recovery ranges from 62% to 78% in historical
production.
– IIIB-230 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Criteria Explanation Commentary
are considered representative of the orebody
as a whole.
For minerals that are defined by a specification,
has the ore reserve estimation been based on
the appropriate mineralogy to meet the
specifications?
The primary copper ore is amenable to flotation
process, final product is copper concentrate. The
concentrate grade and copper recovery are
affected by the sulphur grade and ASCu/TCu
ratio. A general copper recovery of 80% can be
achieved in laboratory tests.
Environmental
The status of studies of potential environmental
impacts of the mining and processing
operation. Details of waste rock
characterisation and the consideration of
potential sites, status of design options
considered and, where applicable, the status of
approvals for process residue storage and
waste dumps should be reported.
The sources of environmental risk are project
activities that may result in potential
environmental impacts.  These project activities
have been previously described within this report.
In summary, the most significant potential
environmental and social risks for the
development of the Project, currently identified as
part of the project assessment and this SRK
review, are:
 TSF seepage pollution;
 Fugitive dust pollution; and
 Deficit mine closure fund.
Infrastructure
The existence of appropriate infrastructure:
availability  of land for plant development,
power, water, transportation (particularly for
bulk commodities), labour, accommodation; or
the ease with which the infrastructure can be
provided, or accessed.
The operation is established, and all required
infrastructure is in place.
Costs
The derivation of, or assumptions made,
regarding projected capital costs in the study.
The methodology used to estimate operating
costs.
Allowances made for the content of deleterious
elements.
The derivation of assumptions made of metal or
commodity price(s), for the principal minerals
and co- products.
The source of exchange rates used in the study.
Derivation of transportation charges.
The basis for forecasting or source of treatment
and refining charges, penalties for failure to
meet specification, etc.
Capital costs for 4Q2024 to 2026 were provided
by LXML, including:
Growth: USD 52.2 million
Exploration: USD19.6 million
Sustain: USD 42.6 million. (The unit sustaining
cost was estimated based on data from 2022 and
2023, amounting to 3.5 USD/ milled ton. This
estimate was used for forecasting the years 2027
to 2030.)
SRK assumed that working capital has been
incorporated into the sustaining capital.
SRK considers it reasonable to expect that the
operation of the Project will be extended with
further exploration and feasibility studies.
Consequently, mine closure fees and the residual
value of the project will not be considered in the
economic projection.
– IIIB-231 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Criteria Explanation Commentary
The allowances made for royalties payable,
both Government and private.
The summary of cash costs from 2021 to 3Q 2024
excludes depreciation, amortization, and financial
costs from the total costs. The unit cost forecast
is based on the maximum value from the past
three years, rounded up to the nearest whole
number. If the unit cost is less than 1.0 USD per
feed ore, the maximum value is used.
.
No metallurgical allowances have been made for
the effect of deleterious elements since none
have been detected.
Following exchange rate were used from 2021 to
3Q 2024:
USD to CNY: 6.4515, 6.7208, 7.0467, 7.1085.
The treatment and refining charge have been
included in the processing costs.
Government royalties are included in the unit
operating cash cost.
Revenue factors
The derivation of, or assumptions made
regarding revenue factors including head
grade, metal or commodity price(s) exchange
rates, transportation  and treatment  charges,
penalties, net smelter returns, etc.
For economic analysis, SRK’s CMF metal prices
were used.
There are no other revenue factors applied.
The derivation of assumptions made of metal or
commodity price(s), for the principal metals,
minerals and co-products.
CMF’s copper and gold prices vary in different
years, considering the trends.
Market assessment
The demand, supply and stock situation for the
particular commodity, consumption trends and
factors likely to affect supply and demand into
the future.
Sepon has developed and has steady buyers of
its products, copper and gold.
A customer and competitor analysis along with
the identification of lik ely market windows for
the product.
Ditto.
Price and volume forecasts and the basis for
these forecasts.
The basis of prices are the CMF forecast, and the
volume are based on the production schedules.
For industrial minerals the customer
specification, testing and acceptance
requirements prior to a supply contract.
N/A.
– IIIB-232 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Criteria Explanation Commentary
Economic
The inputs to the economic analysis to produce
the net present value (NPV) in the study, the
source and confidence of these economic
inputs including estimated inflation,  discount
rate, etc.
The discount rate used for NPV calculation
ranges from 5.0% to 15.0%, with increments of
1.0%. All results indicate a positive NPV.
The operating costs, along with gold and copper
prices, were selected as the essential variable
factors affecting cash flow. These essential
factors were analysed within a ±30% range for
their impact on NPV, using a 10% discount rate.
NPV ranges and sensitivity to variations in the
significant assumptions and inputs.
The NPV is most sensitive to changes in the gold
price, followed by operating costs. Copper price is
the least sensitive factor affecting NPV.
Social The status of agreements with key stakeholders
and matters leading to social licence to operate. See Section 18.4.9.
Other
To the extent relevant, the impact of the
following on the Project and/or on the
estimation and classification of the Ore
Reserves:
Two high risks have been identified: "lack of
significant Ore Reserves" and "high mine closure
cost."
The project is located within the current mining
license, which is valid until 29 September 2033,
thereby covering the entire Life of the Mine (LoM).
Any identified material naturally occurring risks.
The status of material legal agreements and
marketing arrangements.
The status of governmental agreements and
approvals critical to the viability of the Project,
such as mineral tenement status, and
government and statutor y approvals. There
must be reasonable grounds to expect that all
necessary Government approvals will be
received within the time frames anticipated in
the Pre-Feasibility or Feasibility study. Highlight
and discuss the materiality of any unresolved
matter that is dependent on a third party on
which extraction of the reserve is contingent.
Classification
The basis for the classification of the Ore
Reserves into varying confidence categories.
For gold open pit and underground mining,
Measured Mineral Resources in the mine designs
are classified as Proved Ore Reserves. Indicated
Mineral Resources in the mine designs are
classified as Probable Ore Reserves.
For gold and copper stockpiles, only the materials
above MCOG are considered as Probable Ore
Reserves based on reviewing the data provided
by LXML.
Whether the result appropriately reflects the
Competent Person’s view of the deposit.
The proportion of Probable Ore Reserves that
have been derived from Measured Mineral
Resources (if any).
– IIIB-233 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Criteria Explanation Commentary
The classification of Ore Reserves appropriately
reflects the Competent Person’s view of the
deposits.
There is no Measured Mineral Resources are
classified as Probable Ore Reserves.
Audits or reviews The results of any audits or reviews of Ore
Reserve estimates.
The Ore Reserves estimates have been peer
reviewed internally and is in line with current
industry standards.
Discussion of relative
accuracy/ confidence
Where appropriate a statement of the relative
accuracy and confidence level in the Ore
Reserve estimate using an approach or
procedure deemed appropriate by the
Competent Person. For example, the
application of statistical or geostatistical
procedures to quantify the relative accuracy of
the reserve within stated confidence limits, or, if
such an approach is not deemed appropriate, a
qualitative discussion of the factors which could
affect the relative accuracy and confidence of
the estimate.
The Ore Reserves estimates are based on SGPS
and ongoing operations. The Ore Reserves
estimates are at a PFS level.
All modifying factors have been applied for Ore
Reserves estimates on a global estimate.
SRK noted that LXML proposed the use of
cemented backfill for gold underground mining to
increase mining recovery, although no study is
available to date. While cemented backfill is
widely used in various mines, it would be prudent
to conduct an individual backfilling feasibility study
to support further operations.
Accuracy and confidence discussions should
extend to specific discussions of any applied
Modifying Factors that may have a material
impact on Ore Reserve viability, or for which
there are remaining areas of uncertainty at the
current study stage.
SRK considers the level of sampling work carried
out by the client is sufficient for Probable Ore
Reserves in accordance with the JORC Code.

It is recognised that this may not be possible or
appropriate in all circumstances. These
statements of relative accuracy and confidence
of the estimate should be compared with
production data, where available.
The Sepon mine has a long history of production
for the open-pit production. The historical
resource models are not available to SRK.  The
underground mine started its production, with the
accumulated production, the comparison will be
possible later.







– IIIB-234 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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– IIIB-235 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Chapter 18
18.01 DEFINITIONS AND INTERPRETATION
18.02-
18.04 CONDITIONS FOR LISTING OF NEW APPLICANT MINERAL COMPANIES
18.02 In addition to satisfying  the requirements of Chapter 8, a Mineral Company which has
 applied for listing must also satisfy the requirements of this  Chapter.
18.03 A Mineral Company must:—
 (1) establish to the Exchange’s satisfaction that it has the r ight to participate actively in CPR1, CPR3.3[1]
  the exploration for and/or ext raction of Natural Resources, either:—
  (a) through control over a maj ority (by value) of the assets in which it has invested
   together with adequate rights over the exploration for and/o r extraction of
   Natural Resources; or
   Note: ‘control over a majority’ means an interest greater than 50%.
  (b) through adequate rights (arising under arrangements accep table to the
   Exchange), which give it suffi cient influence in decisions over the exploration
   for and/or extraction of the Natural Resources;
 (2) establish to the Exchange’s satisfaction that it has at le ast a portfolio of:— CPR10.7
  (a) Indicated Resources; or
  (b) Contingent Resources,
   identifiable under a Reporting Standard and substantiated in  a Competent Person’s
   Report. This portfolio must be meaningful and of sufficient substance to justify a listing;
 (3) if it has commenced producti on, provide an estimate of cash operating costs CPR17.2. [2]
  including the costs associated with:—
  (a) workforce employment;
  (b) consumables;
  (c) fuel, electricity, water and other services;
  (d) on and off-site administration;
  (e) environmental protection and monitoring;
  (f) transportation of workforce;
  (g) product marketing and transport;
  (h) non-income taxes, royalti es and other governmental charges; and
  (i) contingency allowances;
  Note: A Mineral Company must:
   • set out the components of cash operating costs separately by category;
   • explain the reason for any departur e from the list of items to be included
   under cash operating costs; and
   • discuss any material cost items that should be highlighted to investors.
Appendix C Compliance with Chapter 18
– IIIB-236 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Chapter 18
 (4) demonstrate to the Exchange’s satisfaction that it has available working capital for CPR17.1 [3]
  125% of the group’s present requirements, that is for at leas t the next 12 months,
  which must include:—
  (a) general, administrative and operating costs;
  (b) property holding costs; and
  (c) the cost of any proposed exploration and/or development; and
  Note: Capital expenditures do not need  to be included in working capital
   requirements. Where they are financ ed out of borrowings, relevant interest
   and loan repayments must be included.
 (5) ensure that its working capi tal statement in the listing document under Listing CPR17.1 [3]
  Rule 8.21A states it has ava ilable sufficient working capital for 125% of the group’s
  present requirements, that is  for at least 12 months from the date of its listing
  document.
18.04 If a Mineral Company is unabl e to satisfy either the profit test in rule 8.05(1), the market
 capitalisation/revenue/cash flow test in rule 8.05(2), or the market capitalisation/revenue
 test in rule 8.05(3), it may st ill apply to be listed if it can establish to the Exchange’s
 satisfaction that its directo rs and senior managers, taken together, have sufficient
 experience relevant to the expl oration and/or extraction activity that the Mineral Company
 is pursuing. Individuals relied on must have a minimum of five years relevant industry
 experience. Details of the rele vant experience must be disclosed in the listing document of
 the new applicant.

Not
e:  A Mineral Company relying on this rule mu st demonstrate that its primary activity is
  the exploration for and/or ex traction of Natural Resources.
18.05-
18.08 CONTENTS OF LISTING DOCUMENTS FOR NEW APPLICANTS
18.05 In addition to the information set out in Appendix 1A, a Mineral Company must include in
 its listing document:—
 (1) a Competent Person’s Report;
CPR Executive Summary and
CPR 1.1
 (2) a statement that no materi al changes have occurred since the effective date of CPR 2.8
  the Competent Person’s Report. Where there are material chang es, these must be
  prominently disclosed;
 (3) the nature and extent of its prospecting, exploration, expl oitation, land use and CPR3; CPR16.3
  mining rights and a description of the properties to which th ose rights attach,
  including the duration and othe r principal terms and conditions of the concessions
  and any necessary licences and consents. Details of material rights to be obtained
  must also be disclosed;
 (4) a statement of any legal cla ims or proceedings that may have an influence on its CPR 2.3
  rights to explore or mine;
 (5) disclosure of specific risks and general risks. Companies should have regard to CPR20
  Guidance Note 7 on suggested risk analysis; and
 (6) if relevant and material to t he Mineral Company’s business operations, information
  on the following:—
  (a) project risks arising from  environmental, social, and health and safety issues; CPR20
  (b) any non-governmental or ganisation impact on sustainability of mineral and/or CPR16.4.9
   exploration projects;
  (c) compliance with host count ry laws, regulations and permits, and payments CPR16.3
   made to host country governm ents in respect of tax, royalties and other
   significant payments on a country by country basis;
  (d) sufficient funding plans for remediation, rehabilitation and, closure and removal CPR16.4.8, CPR17.1[4]
– IIIB-237 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Chapter 18
   of facilities in a sustainable manner;
  (e) environmental liabilities o f its projects or properties; CPR16.4
  (f) its historical experienc e of dealing with host country laws and practices, CPR16.4.9
   including management of differences between national and local practice;
  (g) its historical experienc e of dealing with concerns of local governments and CPR16.4.9
   communities on the sites of its mines, exploration propertie s, and relevant
   management arrangements; and
  (h) any claims that may exist over the land on which explorat ion or mining activity CPR16.4.9
   is being carried out, including any ancestral or native claims.
18.06-
18.08 Additional disclosure requirements that apply to certain new applicant Mineral Companies
18.06 If a Mineral Company has  begun production, it must disclose an estimate of the operating CPR17.2
 cash cost per appropriate unit for the minerals and/or Petroleum produced.
18.07 If a Mineral Company has not yet begun production, it must disclose its plans to proceed CPR 17 [5]
 to production with indicative dates and costs. These plans must be supported by at least a
 Scoping Study, substantiated by  the opinion of a Competent Person. If exploration rights or
 rights to extract Resources and/or Reserves have not yet been obtained, relevant risks to
 obtaining these rights must be prominently disclosed.
18.08 If a Mineral Company is involved in the exploration for or extraction of Resour ces, it must CPR10
 prominently disclose to investors that its Resources may not ultimately be extracted at a
  profit.
18.09-
18.13 RELEVANT NOTIFIABLE TRANSACTIONS INVOLVING THE ACQUISITION
 OR DISPOSAL OF MINERAL OR PETROLEUM ASSETS
18.09 A Mineral Company proposi ng to acquire or dispose of assets which are solely or mainly
 Mineral or Petroleum Assets as part of a Relevant Notifiable Transaction must:—
 (1) comply with Chapter 14 and Chapter 14A, if relevant;
 (2) produce a Competent Pers on’s Report, which must form part of the relevant circular,
  on the Resources and/or Reserves being acquired or disposed o f as part of the
  Relevant Notifiable Transaction;
  Note: The Exchange may dispense with the requirement for a Competent Person’s
    Report on disposals where sharehol ders have sufficient information on the
    assets being disposed of.
 (3) in the case of a major (or  above) acquisition, produce a Valuation Report, which must
  form part of the relevant circular, on the Mineral or Petrole um Assets being acquired
  as part of the Relevant Not ifiable Transaction; and
 (4) comply with the requirements of rules 18.05(2) to 18.05(6)  in respect of the assets
  being acquired.

Not
e:  Material liabilities that remain with t he issuer on a disposal must also be discussed.
18.10-
18.11 Requirements that apply to listed issuers
18.10 A listed issuer proposing  to acquire assets which are solely or mainly Mineral or Petroleum
 Assets as part of a Relevant Notifiable Transaction must comply with rule 18.09.
18.11 On completion of a Relevan t Notifiable Transaction involving the acquisition of Mineral or
 Petroleum Assets, unless the Exchange decides otherwise, a listed issuer will be treated
 as a Mineral Company.
18.12-
18.13 Requirements that apply to Mineral Companies and listed issuers
18.12 The Exchange may dispense wi th the requirement to produce a new Competent Person’s
 Report or a Valuation Report under rules 18.05(1), 18.09(2) or  18.09(3), if the issuer
– IIIB-238 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Chapter 18
 has available a previously publ ished Competent Person’s Report or Valuation Report (or
 equivalent) which complies with rules 18.18 to 18.34 (where ap plicable), provided the
 report is no more than six months  old. The issuer must provide this document and a no
 material change statement in t he listing document or circular for the Relevant Notifiable
 Transaction.
18.13 An issuer must obtain the prior written consent of a Competent Person(s) or Competent
 Evaluator for their material to be included in the form and co ntext in which it appears in
 a listing document or circular fo r the Relevant Notifiable Transaction, whether or not such
 person or firm is retained by the listing applicant or the iss uer.
18.14-
18.17 CONTINUING OBLIGATIONS
18.14 Disclosure in reports
18.14 A Mineral Company must incl ude in its interim (half-yearly) and annual reports details
 of its exploration, developmen t and mining production activities and a summary of
 expenditure incurred on these ac tivities during the period under review. If there has been
 no exploration, development or production activity, that fact must be stated.
18.15-
18.17 Publication of Resources and Reserves
18.15 A listed issuer that public ly discloses details of Resources and/or Reserves must give an
 update of those Resources and/or Reserves once a year in its a nnual report, in accordance
 with the reporting standard under which they were previously d isclosed or a Reporting
 Standard.
18.16 A Mineral Company must inc lude an update of its Resources and/or Reserves in its annual
 report in accordance with the Reporting Standard under which t hey were previously
 disclosed.
18.17 Annual updates of Resources an d/or Reserves must comply with rule 18.18.

Not
e: Annual updates are not required to be supported by a Competent Person’s Report
  and may take the form of a no material change statement.
18.18-
18.27 STATEMENTS ON RESOURCES AND/OR RESERVES
18.18 Presentation of data
18.18 Any data presented on Resources and/or Reserves by a Mine ral Company in a listing CPR10.7
 document, Competent Person’s Report, Valuation Report or annual report, must be CPR11.8
 presented in tables in a manner readily understandable to a no n-technical person. All
 assumptions must be clearly dis closed and statements should include an estimate of
 volume, tonnage and grades.
18.19 Basis of evidence
18.19 All statements referring to Resources and/or Reserves:—
 (1) in any new applicant listing document or circular relating to a Relevant Notifiable

Transaction, must be substantiated in a Competent Person’s Report which must form part of
the document; and
 (2) in all other cases, must a t least be substantiated by the issuer’s internal experts.
18.20 Petroleum Competent Persons’ Reports Not applicable.
18.20 A Competent Person’s Repor t for Mineral Companies involved in the exploration for and/or
 extraction of Petroleum Resour ces and Reserves must include the information set out in
 Appendix 25.
18.21-
18.22 Competent Person
18.21 A Competent Person must:—
 (1) have a minimum of five years experience relevant to the style of mineralization CPR 2.6; CPR2.7
– IIIB-239 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Chapter 18
  and type of deposit under consi deration or to the type of Petroleum exploration,
  reserve estimate (as appropri ate), and to the activity which the Mineral Company is
  undertaking;
 (2) be professionally qualified, and be a member in good standi ng of a relevant CPR 2.6; CPR2.7
  Recognised Professional Organisa tion, in a jurisdiction where, in the Exchange’s
  opinion, the statutory securiti es regulator has satisfactory arrangements (either by
  way of the IOSCO Multilateral MOU or other bi-lateral agreement acceptable to the
  Exchange) with the Commission for mutual assistance and excha nge of information
  for enforcing and securing compliance with the laws and regul ations of that
  jurisdiction and Hong Kong; and
 (3) take overall responsibility for the Competent Person’s Repo rt. CPR 2.6; CPR2.7
18.22 A Competent Person must be independent of the issuer, its  directors, senior management CPR2.10
 and advisers. Specifically the Co mpetent Person retained must:—
 (1) have no economic or beneficia l interest (present or contingent) in any of the assets
  being reported on;
 (2) not be remunerated with a fee dependent on the findings of  the Competent Person’s
  Report;
 (3) in the case of an individual, not be an officer, employee or proposed officer of the
  issuer or any group, holding or associated company of the issuer; and
 (4) in the case of a firm, not be a group, holding or associat ed company of the issuer.
  Any of the firm’s partners or  officers must not be officers or proposed officers of any
  group, holding or associated company of the issuer.
18.23 Additional requirements of Competent Evaluators
18.23 In addition to the requirements set out in rules 18.21(2) and 18.22, a Competent Evaluator
 must:—
 (1) have at least ten years rele vant and recent general mining or Petroleum experience
  (as appropriate);
 (2) have at least five years rele vant and recent experience in the assessment and/or
  valuation of Mineral or Petroleum Assets or securities (as appropriate); and
 (3) hold all necessary licences.

Not
e:  A Competent Person’s Report or Valuation Report may be performed by the same
  Competent Person provided he or s he is also a Competent Evaluator.
18.24 Scope of Competent Persons’ Reports and Valuation Reports
18.24 A Competent Person’s Report o r Valuation Report must comply with a Reporting Standard
 as modified by this Chapter, and must:—
 (1) be addressed to the Mineral Company or listed issuer; CPR 2.2
 (2) have an effective date (being the date when the contents o f the Competent CPR 2.4
  Person’s Report or Valuation Report are valid) less than six months before the
  date of publishing the listing document or circular relating to a Relevant Notifiable
  Transaction required under the Listing Rules; and
 (3) set out what Reporting Standard has been used in preparing the Competent CPR 2.2
  Person’s Report or Valuation Report, and explain any departure from the relevant
  Reporting Standard.
18.25-
18.26 Disclaimers and Indemnities
18.25 A Competent Person’s Report or Valuation Report may conta in disclaimers of sections CPR 2.2
 or topics outside their scope of e xpertise in which the Competent Person or Competent
 Evaluator relied upon other ex perts’ opinions, but must not contain any disclaimers of the
 report in its entirety.
18.26 The Competent Person or Competent Evaluator must prominen tly disclose in the CPR 2.11, CPR 2.12
– IIIB-240 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


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Chapter 18
 Competent Person’s Report or Valuation Report the nature and d etails of all indemnities
 provided by the issuer. Indemniti es for reliance placed on information provided by issuers
 and third party experts (for information outside the Competent  Person’s or Competent
 Evaluator’s expertise) are ge nerally acceptable. Indemnities for fraud and gross negligence
 are generally unacceptable.
18.27 Obligations of sponsor
18.27 Any sponsor appointed to or by a new applicant Mineral Company under Chapter 3A must CPR 1.4, CPR 1.7
 ensure that any Competent Person or Competent Evaluator meets the requirements of
 this Chapter.
18.28-
18.34 REPORTING STANDARD
18.28-
18.30 Mineral reporting standard
18.28 In addition to satisfying  the requirements of Chapter 13 (as modified by this Chapter), a
 Mineral Company exploring for and/or extracting mineral Resources and Reserves must
 also satisfy rules 18.29 and 18.30.
18.29 A Mineral Company must di sclose information on mineral Resources, Reserves and/or CPR2.2
 exploration results either:—
 (1) under:
  (a) the JORC Code;
  (b) NI 43-101; or
  (c) the SAMREC Code,
  as modified by this Chapter; or
 (2) under other codes acceptable  to the Exchange as communicated to the market
  from time to time, provided t he Exchange is satisfied that they give a comparable
  standard of disclosure and sufficient assessment of the under lying assets.

Not
e:  The Exchange may allow presentation of Reserves under other reporting standards
  provided reconciliation to a Reporting Standard is provided. A Reporting Standard
  applied to specific assets  must be used consistently.
18.30 A Mineral Company must ensure that:—
 (1)
any estimates of mineral Reserves disclosed are supported, at a minimum, by a Prefeasibility
Study; CPR11.2
 (2) estimates of mineral Reser ves and mineral Resources are disclosed separately; CPR10; CPR11
 (3) Indicated Resources and Measured Resources are only includ ed in economic CPR11, CPR11.7, CPR11.8
  analyses if the basis on which  they are considered to be economically extractable CPR18.1
  is explained and they are appropriately discounted for the pr obabilities of their
  conversion to mineral Reserves. All assumptions must be clear ly disclosed.
  Valuations for Inferred Resources are not permitted;
 (4) for commodity prices used in Pre-feasibility Studies, Feas ibility Studies and CPR17.3
  valuations of Indicated Resources, Measured Resources and Res erves:—
  (a) the methods to determine those commodity prices, all mate rial assumptions CPR17.3
   and the basis on which those prices represent reasonable views of future
   prices are explained clearly; and
  (b)  if a contract for future prices of mineral Reserves exis ts, the contract price is CPR15
   used; and
 (5) for forecast valuations of R eserves and profit forecasts, sensitivity analyses to higher CPR 18
  and lower prices are supplied . All assumptions must be clearly disclosed.
18.31-
18.33 Petroleum reporting standard Not applicable.
18.31 In addition to satisfying  the requirements of Chapter 13 (as modified by this Chapter), a
– IIIB-241 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


--- page 1522 ---
Competent Person's Report for the Sepon Gold and Copper Project, Lao People's Democratic Republic
References    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 210
Chapter 18
 Mineral Company exploring for an d/or extracting Petroleum Resources and Reserves must
 also satisfy rules 18.32 and 18.33.
18.32 A Mineral Company must di sclose information on Petroleum Resources and Reserves
 either:—
 (1) under PRMS as modified by this Chapter; or
 (2) under other codes acceptable to the Exchange if it is sati sfied that they give a
  comparable standard of discl osure and sufficient assessment of the underlying
  assets.

Not
e:  A Reporting Standard applied to specif ic assets must be used consistently.
18.33 A Mineral Company must ensure that:—
 (1) where estimates of Reserves are disclosed, the method and reason for choice of
  estimation are disclosed (i.e. deterministic or probabilistic  methods, as defined in
  PRMS). Where the probabilistic method is used, the underlying confidence levels
  applied must be stated;
 (2) if the NPVs attributable to P roved Reserves and Proved plus Probable Reserves are
  disclosed, they are presented on a post-tax basis at varying discount rates (including
  a reflection of the weighted av erage cost of capital or minimum acceptable rate of
  return that applies to the entity at the time of evaluation) or a fixed discount rate of
  10%;
 (3) Proved Reserves and Proved plus Probable Reserves are anal ysed separately and
  principal assumptions (includi ng prices, costs, exchange rates and effective date) and
  the basis of the methodology  are clearly stated;
 (4) if the NPVs attributable to  Reserves are disclosed, they are presented using a
  forecast price as a base case or using a constant price as a base case. The bases
  for the forecast case must be disclosed. The constant price is defined as the
  unweighted arithmetic average of the closing price on the first day of each month
  within the 12 months before the end of the reporting period, unless prices are
  defined by contractual arrangemen ts. The basis on which the forecast price is
  considered reasonable must be disclosed and Mineral Companies must comply with
  rule 18.30;
  Note: In the forecast case under PR MS, the economic evaluation underlying the
   investment decision is based on the entity’s reasonable forecast of future
   conditions, including costs and prices, which will exist during the life of the
   project.
 (5) if estimated volumes of Contingent Resources or Prospectiv e Resources are
  disclosed, relevant risk fa ctors are clearly stated;
  Note: Under PRMS, wherever the volume of a Contingent Resource is stated,
   risk is expressed as the chance t hat the accumulation will be commercially
   developed and graduate to the reserves class. Wherever the volume of a
   Prospective Resource is stated, risk is expressed as the chance that a potential
   accumulation will result in a significant discovery of Petroleum.
 (6) economic values are not att ached to Possible Reserves, Contingent Resources or
  Prospective Resources; and
 (7) where an estimate of future net revenue is disclosed, whether calculated without
  discount or using a discount rate, it is prominently disclose d that the estimated
  values disclosed do not rep resent fair market value.
18.34 Mineral or Petroleum Asset Valuation Reports Not applicable.
18.34 A Mineral Company must ensure that:—
 (1) any valuation of its Miner al or Petroleum Assets is prepared under the VALMIN
  Code, SAMVAL Code, CIMVAL or such other code approved by the Exchange from
– IIIB-242 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


--- page 1523 ---
Competent Person's Report for the Sepon Gold and Copper Project, Lao People's Democratic Republic
References    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 211
Chapter 18
  time to time;
 (2) the Competent Evaluator s tates clearly the basis of valuation, relevant assumptions
  and the reason why a particula r method of valuation is considered most appropriate,
  having regard to the nature of the valuation and the developm ent status of the
  Mineral or Petroleum Asset;
 (3) if more than one valuation method is used and different va luations result, the
  Competent Evaluator comments on how the valuations compare an d on the reason
  for selecting the value adopted; and
 (4) in preparing any valuation a Competent Evaluator meets the requirements set out in
  rule 18.23.
Note：
1. CPR is the Competent Person’s Report prepared by SRK; 1 and 3.3 are the section numbers.
2. Operating cost is breakdown a ccording to cost center, instead of cost element.
3. Without considering current a ssets and current liabilities, SRK made the assumption that the working capital has been incorporated into
the sustaining capital.
4. It is reasonable to expect that the operation of the Project  will be extended with further exploration and feasibility stud ies, the mine
closure fees, and the residual value of the project will not be considered in the economic projection.
5. Sepon Mine is a producing project.

– IIIB-243 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


--- page 1524 ---
Competent Person's Report for the Sepon Gold and Copper Project, Lao People's Democratic Republic
References    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 212

Appendix D Chapter 2.6 of the Guide for New Listing
Applicants
– IIIB-244 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


--- page 1525 ---
Competent Person's Report for the Sepon Gold and Copper Project, Lao People's Democratic Republic
References    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 213
Chapter 2.6 Section in SRK’s Report
(i)
The cut-off grade (which should be an industry standard commonly used),
minimum mining width, economic parameters (e.g. waste to ore ratio, stope
productivity), specific gravity derivation, prevailing commodity price
assumptions;
Section 10.4, 11.4, 11.5, 12.4,
12.6, 17.3
(ii)
If the Competent Person has a different view on certain assumptions (e.g.
processing recovery rate) made by the applicant, both views should be
disclosed in the listing document, with differences highlighted and underlying
reasons for the different views, and the impact on the applicant if the more
conservative view is adopted;
Not applicable.
(iii)
Detailed analysis for harmful elements identified at mines (e.g. mercury or
arsenic at lead and zinc mines) to give a better picture of whether there are
material concentrations of these elements within particular lodes, and the
impact on the saleability of the minerals;
Not applicable.
(iv) Clear and meaningful drawings and diagrams, shown to scale, of the location
of the applicant’s principal Mineral or Petroleum Assets;
Section 4
(v)
The procedures, amount of testing, assessment and time required to ascertain
the amount of Reserves, and the existing Reserves of the mine over its entire
mine life, expected average Resource and Reserve grades of ore that can be
extracted in future years (preferably covering the whole economic life of the
mine), depletion charges and hedging activities;
Section 11 and Section 12
(vi)
Whether the historical or expected improved recovery rate is used for
estimating the net present value (“NPV”), and the basis on which the discount
rates are considered appropriate;
Section 18
(vii)
If the Competent Person did not conduct a site visit, the applicant should
disclose in the “Business” section of the listing document the basis on which
the Reserves/Resources, cost forecasts and other data relating to the mines/
oilfields as disclosed in the CPR are arrived at, how the lack of a site visit
would affect the reliability of the information, and an appropriate risk factor 3;
and
Section 1.5
(viii) All material risks mentioned in the CPR should be disclosed in the “Risk
Factors” section of the listing document.
Section 20

– IIIB-245 –
APPENDIX IIIB COMPETENT PERSON ’S REPORT
FOR THE SEPON GOLD AND COPPER MINE


--- page 1526 ---
Cover Page
Final
Independent Competent Person’s Report
for Wassa Gold Mine, Akyempim,
Western Region, Ghana
Wassa Project, Akyempim, Ghana

Golden Star Wassa Limited

SRK Consulting (China) Ltd.  SCN849C  28 February 2025

– IIIC-1 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1527 ---
Final

Independent Competent Person’s Report for Wassa Gold Mine, Akyempim,
Western Region, Ghana
Wassa Project, Akyempim, Ghana

Prepared for:
Golden Star Wassa Limited
(an indirect subsidiary of Chifeng Gold)





Prepared by:
SRK Consulting (China) Ltd.
B1301 COFCO Plaza, No. 8 Jianguomen Inner Street
Dongcheng District, Beijing, China
100005

+86 10 6511 1000
www.srk.com



Lead Author:  Pengfei Xiao (Principal Consultant) Initials: PX

Peer Reviewer:  Alexander Thin (Principal Consultant) Initials: AT

Report Effective Date: 30 September 2024



Cover Image(s):

Copyright © 2025
SRK Consulting (China) Ltd.     SCN849C     28 February 2025


Inside Cover Page
– IIIC-2 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1528 ---
Acknowledgments
SRK would like to acknowledge the support and collaboration provided by personnel of Golden Star Wassa Limited
for this assignment. Their collaboration was greatly appreciated and instrumental in the completion of this technical
report.


Disclaimer and Notices

The opinions expressed in this Report have been based on the information supplied to SRK Consulting (China) Ltd.
(“SRK”) by Golden Star Wassa Limited (the “Client”, or the “Company”).  The opinions in this Report are provided in
response to a specific request from the Client to do so.  SRK h as exercised all due care in reviewing the supplied
information.  Whilst SRK has compared key supplied data with ex pected values, the accuracy of the results and
conclusions from the review is entirely reliant on the accuracy  and completeness of the supplied data.  SRK does
not accept responsibility for any errors or omissions in the su pplied information and does not accept any
consequential liability arising from commercial decisions or actions resulting from them.  Opinions presented in this
report apply to the site conditions and features as they existe d at the time of SRK’s investigations, and those
reasonably foreseeable.  These opinions do not necessarily apply to conditions and features that may arise after the
date of this Report, about which SRK had no prior knowledge nor had the opportunity to evaluate.
– IIIC-3 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Independent Competent Person’s Report for Wassa Gold Mine, Akyempim, Western Region, Ghana
Contents    Final
SRK CONSULTING (CHINA) LTD.   28 FEBRUARY 2025  PX/AT iv
Contents
Useful Definitions ........................................................................................................................................................ xv
Executive Summary ................................................................................................................................................. - 1 -
Property Description and Ownership ....................................................................................................................... - 1 -
Geology and Mineralisation ..................................................................................................................................... - 1 -
Exploration ............................................................................................................................................................... - 3 -
Mineral Resource Estimates .................................................................................................................................... - 3 -
Ore Reserve Estimates ............................................................................................................................................ - 6 -
Mining ...................................................................................................................................................................... - 7 -
Mineral Processing .................................................................................................................................................. - 9 -
Environmental and Social Aspects ........................................................................................................................ - 10 -
Capital Cost and Operating Cost ........................................................................................................................... - 10 -
Project Economics ................................................................................................................................................. - 11 -
1 Introduction .................................................................................................................................................. - 17 -
2 Program Objectives and Work Program ...................................................................................................... - 18 -
2.1 Purpose of the Report ................................................................................................................................. - 18 -
2.2 Scope of Work and Reporting Standard ...................................................................................................... - 18 -
2.2.1 Scope of Work .............................................................................................................................. - 18 -
2.2.2 Basis of Technical Report ............................................................................................................ - 18 -
2.2.3 Site Visit ....................................................................................................................................... - 19 -
2.2.4 Reporting Standard ...................................................................................................................... - 19 -
2.3 Limitations Statement .................................................................................................................................. - 19 -
2.4 Effective Date .............................................................................................................................................. - 20 -
2.5 Work Program ............................................................................................................................................. - 20 -
2.6 SRK Experience .......................................................................................................................................... - 20 -
2.7 Project Team ............................................................................................................................................... - 22 -
2.8 Warranties ................................................................................................................................................... - 26 -
2.9 Compliance Statement ................................................................................................................................ - 26 -
2.10 Independence Statement ............................................................................................................................ - 26 -
2.11 Consent ....................................................................................................................................................... - 27 -
2.12 Forward Looking Statement ........................................................................................................................ - 27 -
3 Operational Licenses and Permits .............................................................................................................. - 28 -
3.1 Mineral Tenure ............................................................................................................................................ - 30 -
3.2 Underlying Agreements ............................................................................................................................... - 31 -
3.3 Permits and Authorisation ........................................................................................................................... - 31 -
3.4 Environmental Considerations .................................................................................................................... - 33 -
3.5 Mining Rights in Western Region of Ghana ................................................................................................ - 33 -
4 Accessibility, Climate, Local Resources, Infrastructure, and Physiography ............................................... - 34 -
4.1 Accessibility ................................................................................................................................................. - 34 -
4.2 Local Resources and Infrastructure ............................................................................................................ - 34 -
4.3 Climate ......................................................................................................................................................... - 34 -
4.4 Physiography ............................................................................................................................................... - 35 -
5 History .......................................................................................................................................................... - 36 -
5.1 Wassa .......................................................................................................................................................... - 36 -
5.1.1 Historical Mining ........................................................................................................................... - 36 -
– IIIC-4 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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5.1.2 Satellite Goldfields Limited (1993-2002) ...................................................................................... - 36 -
5.2 Hwini Butre, Benso and Chichiwelli ............................................................................................................. - 36 -
5.2.1 Historical Mining ........................................................................................................................... - 36 -
5.2.2 Modern Exploration (1980’s-2005) ............................................................................................... - 37 -
5.3 Production History, Previously Declared Resources and Reserves ........................................................... - 38 -
6 Geological Setting and Mineralisation ......................................................................................................... - 40 -
6.1 Regional Geology ........................................................................................................................................ - 40 -
6.2 Property Geology ......................................................................................................................................... - 42 -
6.3 Deposit Types .............................................................................................................................................. - 48 -
6.3.1 Wassa .......................................................................................................................................... - 48 -
6.3.2 Hwini Butre ................................................................................................................................... - 50 -
6.3.3 Benso ........................................................................................................................................... - 51 -
6.3.4 Chichiwelli .................................................................................................................................... - 51 -
7 Exploration, Sampling, and Assaying .......................................................................................................... - 53 -
7.1 Exploration ................................................................................................................................................... - 53 -
7.1.1 Wassa .......................................................................................................................................... - 54 -
7.1.2 Benso and Chichiwelli .................................................................................................................. - 56 -
7.1.3 Hwini Butre ................................................................................................................................... - 58 -
7.2 Drilling .......................................................................................................................................................... - 59 -
7.2.1 Surface Drilling ............................................................................................................................. - 62 -
7.2.2 Underground Drilling (Wassa Main) ............................................................................................. - 63 -
7.2.3 RAB/AC Drilling ............................................................................................................................ - 64 -
7.3 Sample Preparation, Analyses, and Security .............................................................................................. - 64 -
7.3.1 Sampling ...................................................................................................................................... - 64 -
7.3.2 Sample Preparation ..................................................................................................................... - 65 -
7.3.3 Sample Dispatch and Security ..................................................................................................... - 66 -
7.3.4 Laboratory Procedures ................................................................................................................. - 66 -
7.3.5 Quality Control and Quality Assurance ........................................................................................ - 70 -
7.3.6 Comparison of Assay Methodologies .......................................................................................... - 70 -
8 Data Verification .......................................................................................................................................... - 72 -
8.1 Verifications by Golden Star (Wassa) ......................................................................................................... - 72 -
8.2 Verifications by SRK (Between 2019 and 2022) ......................................................................................... - 72 -
8.2.1 Duplicates .................................................................................................................................... - 72 -
8.2.2 CRMs and Blanks ........................................................................................................................ - 73 -
8.2.3 Comments .................................................................................................................................... - 75 -
8.3 Verifications by SRK (Between 2023 and March 2024) .............................................................................. - 75 -
8.3.1 B Shoot......................................................................................................................................... - 75 -
8.3.2 242 ............................................................................................................................................... - 81 -
8.3.3 DMH ............................................................................................................................................. - 83 -
8.3.4 Comments .................................................................................................................................... - 86 -
9 Mineral Processing and Metallurgical Testing ............................................................................................. - 87 -
9.1 Metallurgical Test works of 2003 ................................................................................................................. - 87 -
9.2 Metallurgical Testwork of 2015 .................................................................................................................... - 87 -
9.2.1 Variability, Crushability and Reference Sample ........................................................................... - 88 -
9.2.2 Programme of Metallurgical Test works ....................................................................................... - 89 -
9.2.3 Findings of Metallurgical Test works ............................................................................................ - 90 -
9.3 Metallurgical Testwork of 2018 .................................................................................................................. - 102 -
10 Mineral Resource Estimates...................................................................................................................... - 104 -
– IIIC-5 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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10.1 Introduction ................................................................................................................................................ - 104 -
10.2 Resource Estimation Procedures .............................................................................................................. - 105 -
10.3 Resource Database ................................................................................................................................... - 105 -
10.3.1 Zone B Shoot ............................................................................................................................. - 105 -
10.3.2 Zone 242 .................................................................................................................................... - 106 -
10.3.3 DMH ........................................................................................................................................... - 108 -
10.3.4 I Zone ......................................................................................................................................... - 109 -
10.3.5 Hwini Butre ................................................................................................................................. - 110 -
10.3.6 Chichiwelli .................................................................................................................................. - 111 -
10.4 Solid Body Modelling ................................................................................................................................. - 112 -
10.4.1 Zone B Shoot ............................................................................................................................. - 112 -
10.4.2 Zone 242 .................................................................................................................................... - 116 -
10.4.3 DMH ........................................................................................................................................... - 117 -
10.4.4 I Zone ......................................................................................................................................... - 118 -
10.4.5 Hwini Butre ................................................................................................................................. - 119 -
10.4.6 Chichiwelli .................................................................................................................................. - 120 -
10.5 Compositing ............................................................................................................................................... - 121 -
10.5.1 Zone B Shoot ............................................................................................................................. - 121 -
10.5.2 Zone 242 .................................................................................................................................... - 122 -
10.5.3 DMH ........................................................................................................................................... - 124 -
10.5.4 I Zone ......................................................................................................................................... - 125 -
10.5.5 Chichiwelli .................................................................................................................................. - 126 -
10.6 Evaluation of Outliers ................................................................................................................................ - 126 -
10.6.1 Zone B Shoot ............................................................................................................................. - 126 -
10.6.2 Zone 242 .................................................................................................................................... - 129 -
10.6.3 DMH ........................................................................................................................................... - 131 -
10.6.4 I Zone ......................................................................................................................................... - 133 -
10.6.5 Hwini Butre ................................................................................................................................. - 135 -
10.6.6 Chichiwelli .................................................................................................................................. - 136 -
10.7 Statistical Analysis and Variography ......................................................................................................... - 136 -
10.7.1 Zone B Shoot ............................................................................................................................. - 136 -
10.7.2 Zone 242 .................................................................................................................................... - 138 -
10.7.3 DMH ........................................................................................................................................... - 139 -
10.7.4 I Zone ......................................................................................................................................... - 141 -
10.7.5 Hwini Butre ................................................................................................................................. - 142 -
10.7.6 Chichiwelli .................................................................................................................................. - 151 -
10.8 Block Model and Grade Estimation ........................................................................................................... - 151 -
10.8.1 Zone B Shoot ............................................................................................................................. - 151 -
10.8.2 Zone 242 .................................................................................................................................... - 152 -
10.8.3 DMH ........................................................................................................................................... - 154 -
10.8.4 I Zone ......................................................................................................................................... - 155 -
10.8.5 Hwini Butre ................................................................................................................................. - 156 -
10.8.6 Chichiwelli .................................................................................................................................. - 157 -
10.9 Model Validation and Sensitivity ................................................................................................................ - 158 -
10.10 Mineral Resource Classification ................................................................................................................ - 166 -
10.11 Mineral Resource Statement ..................................................................................................................... - 171 -
10.12 Grade Sensitivity Analysis ......................................................................................................................... - 174 -
10.13 Previous Mineral Resource Estimates ...................................................................................................... - 177 -
10.14 Mineral Resource Risks and Opportunities ............................................................................................... - 179 -
11 Ore Reserve Estimates ............................................................................................................................. - 180 -
11.1 Open Pit Mining ......................................................................................................................................... - 181 -
– IIIC-6 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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11.1.1 Source of Information ................................................................................................................. - 181 -
11.1.2 Cut-off Grade ............................................................................................................................. - 181 -
11.1.3 Ore Reserve Statement ............................................................................................................. - 182 -
11.2 Underground Mining .................................................................................................................................. - 182 -
11.2.1 Source of Information ................................................................................................................. - 182 -
11.2.2 Cut-off Grade ............................................................................................................................. - 183 -
11.2.3 Modifying Factors ....................................................................................................................... - 185 -
11.2.4 Ore Reserve Statement ............................................................................................................. - 185 -
11.3 Combined Ore Reserves Statement ......................................................................................................... - 186 -
12 Mining Methods ......................................................................................................................................... - 188 -
12.1 Open Pit Mining ......................................................................................................................................... - 188 -
12.1.1 Open Pit Optimisation ................................................................................................................ - 188 -
12.1.2 Practical Open Pit Design .......................................................................................................... - 189 -
12.1.3 Production Schedule .................................................................................................................. - 190 -
12.1.4 Conclusion and Recommendation ............................................................................................. - 191 -
12.2 Underground Mining .................................................................................................................................. - 191 -
12.2.1 Introduction ................................................................................................................................ - 191 -
12.2.2 Geotechnics ............................................................................................................................... - 192 -
12.2.3 Mining Method ............................................................................................................................ - 202 -
12.2.4 Development Design .................................................................................................................. - 203 -
12.2.5 Production .................................................................................................................................. - 204 -
12.2.6 Equipment .................................................................................................................................. - 204 -
12.2.7 Production Schedule .................................................................................................................. - 205 -
12.2.8 Mine Service .............................................................................................................................. - 207 -
12.2.9 Wassa Ore Reserves and Upside Plan ..................................................................................... - 211 -
12.2.10 Life of Mine Schedule ................................................................................................................. - 213 -
12.2.11 Conclusions and Recommendations ......................................................................................... - 215 -
13 Recovery Methods ..................................................................................................................................... - 217 -
13.1 Processing History ..................................................................................................................................... - 217 -
13.2 Process Description ................................................................................................................................... - 217 -
13.2.1 Crushing and Grinding ............................................................................................................... - 218 -
13.2.2 Gravity Gold Extraction .............................................................................................................. - 219 -
13.2.3 Leaching ..................................................................................................................................... - 219 -
13.2.4 Elution, Electrowinning, Smelting and Regeneration ................................................................. - 219 -
13.3 Production Performance ............................................................................................................................ - 220 -
13.4 Processing Facility ..................................................................................................................................... - 220 -
13.5 Proposed Changes to the Treatment Circuit ............................................................................................. - 221 -
13.6 Laboratories Tests ..................................................................................................................................... - 222 -
13.6.1 Wet Chemistry and Assay .......................................................................................................... - 222 -
13.6.2 Metallurgical Laboratory ............................................................................................................. - 222 -
14 Project Infrastructure ................................................................................................................................. - 223 -
14.1 Tailings Storage Facility ............................................................................................................................ - 223 -
14.2 Water Supply ............................................................................................................................................. - 224 -
14.3 Power Supply ............................................................................................................................................ - 225 -
15 Market Studies and Contracts ................................................................................................................... - 227 -
15.1 Market Studies ........................................................................................................................................... - 227 -
15.2 Contracts ................................................................................................................................................... - 227 -
16 Environmental Studies, Permitting, and Social or Community Impact...................................................... - 228 -
– IIIC-7 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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16.1 Environmental and Social Review Objective ............................................................................................. - 228 -
16.2 Review Process, Scope and Standards .................................................................................................... - 228 -
16.3 Relevant Legislation and Required Approvals .......................................................................................... - 228 -
16.3.1 Permitting Requirements in Ghana ............................................................................................ - 228 -
16.3.2 Status of Environmental Approvals and Permits ....................................................................... - 230 -
16.4 Environmental and Social Aspects ............................................................................................................ - 231 -
16.4.1 Ecological Impact ....................................................................................................................... - 231 -
16.4.2 Water Management .................................................................................................................... - 232 -
16.4.3 Waste and Tailings Management .............................................................................................. - 233 -
16.4.4 Air and Noise Pollution ............................................................................................................... - 234 -
16.4.5 Hazardous Materials Management ............................................................................................ - 235 -
16.4.6 Occupational Health and Safety (“OHS”) ................................................................................... - 235 -
16.4.7 Environmental Protection and Management Plan (“EPMP”) ..................................................... - 236 -
16.4.8 Mine Closure Plan and Rehabilitation ........................................................................................ - 236 -
16.4.9 Social Aspects ............................................................................................................................ - 237 -
17 Capital and Operating Costs ..................................................................................................................... - 239 -
17.1 Capital Expenditure ................................................................................................................................... - 239 -
17.1.1 Summary .................................................................................................................................... - 239 -
17.1.2 Capitalisation .............................................................................................................................. - 240 -
17.1.3 Sustaining Capex ....................................................................................................................... - 240 -
17.1.4 Closure ....................................................................................................................................... - 241 -
17.2 Operating Cost .......................................................................................................................................... - 241 -
17.2.1 Cost by Elements ....................................................................................................................... - 241 -
17.2.2 Cost by Activities ........................................................................................................................ - 243 -
18 Economic Analysis .................................................................................................................................... - 249 -
18.1 Principal Assumptions ............................................................................................................................... - 249 -
18.1.1 General....................................................................................................................................... - 249 -
18.1.2 LOM Physical ............................................................................................................................. - 249 -
18.1.3 Pricing Assumptions ................................................................................................................... - 250 -
18.1.4 Tax and Royalties ...................................................................................................................... - 250 -
18.1.5 Depreciation and Amortization ................................................................................................... - 250 -
18.1.6 Working Capital .......................................................................................................................... - 250 -
18.2 DCF Projection .......................................................................................................................................... - 250 -
18.3 Sensitivity Analysis .................................................................................................................................... - 252 -
18.4 Wassa Ore Reserves and Upside Plan ..................................................................................................... - 253 -
19 Risk Analysis ............................................................................................................................................. - 256 -
20 Conclusions and Recommendations ......................................................................................................... - 259 -
20.1 Conclusions ............................................................................................................................................... - 259 -
20.1.1 Geology and Exploration ............................................................................................................ - 259 -
20.1.2 Mineral Resources Estimation ................................................................................................... - 259 -
20.1.3 Metallurgical Testing and Recovery Method .............................................................................. - 259 -
20.1.4 Infrastructure .............................................................................................................................. - 260 -
20.2 Recommendations ..................................................................................................................................... - 260 -
21 References ................................................................................................................................................ - 261 -

– IIIC-8 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1534 ---
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Contents    Final
SRK CONSULTING (CHINA) LTD.   28 FEBRUARY 2025  PX/AT ix
Tables
Table 2-1: SRK’s Reports for Listing on the HKEx ............................................................................................. - 21 -
Table 3-1: Mineral Tenure Information .................................................................................................................. - 30 -
Table 6-1: Compilation of Deformational History of the Ashanti Belt .................................................................... - 45 -
Table 7-1: Summary of Exploration Data used in the Mineral Resources Estimates ............................................ - 60 -
Table 8-1: CRM from Geostats Used within HBB between 2019 and 2022 .......................................................... - 74 -
Table 8-2: CRM from Geostats Used within Wassa Main between 2019 and 2022 ............................................. - 74 -
Table 8-3: Blank from Hwini Butre Benso Assays ................................................................................................. - 74 -
Table 8-4: Blank from Wassa Main Assays ........................................................................................................... - 74 -
Table 8-5: QA/QC Summary Between 2023 and March 2024 .............................................................................. - 75 -
Table 8-6: B Shoot CRMs Summary Between 2023 and March 2024 .................................................................. - 75 -
Table 8-7: B Shoot Field Duplicates Summary Between 2023 and March 2024 .................................................. - 79 -
Table 8-8: B Shoot Lab Check Duplicates Summary Between 2023 and March 2024 ......................................... - 80 -
Table 8-9: 242 CRMs Summary Between 2023 and March 2024 ......................................................................... - 81 -
Table 8-10: 242 Field Duplicates Summary Between 2023 and March 2024 ....................................................... - 83 -
Table 8-11: DMH CRMs Summary Between 2023 and March 2024 ..................................................................... - 84 -
Table 8-12: DMH Field Duplicates Summary Between 2023 and March 2024 ..................................................... - 85 -
Table 9-1: Ore Zones Represented by the Variability Samples ............................................................................ - 88 -
Table 9-2: Summary of Location of 2015 Testwork Samples ................................................................................ - 89 -
Table 9-3: Head Grades of Screened Samples ..................................................................................................... - 90 -
Table 9-4: Elemental and Chemical Analyses ....................................................................................................... - 91 -
Table 9-5: Summary of Gold Deportment Using Diagnostic Leaching .................................................................. - 92 -
Table 9-6: Results of Crushability Tests using UCS and CWi ............................................................................... - 94 -
Table 9-7: Bond Work Indices and Abrasion Indices from the 2015 Testwork ..................................................... - 96 -
Table 9-8: Gravity Gold Recovery Test Results .................................................................................................... - 98 -
Table 9-9: Summary of CIL Results....................................................................................................................... - 98 -
Table 9-10: Gold Recoveries from Samples, Cyanide and Lime Consumption Rates .......................................... - 99 -
Table 9-11: Recoveries of Gold from Samples via Gravity-Leach Routes .......................................................... - 100 -
Table 9-12: Reconciliation of Assay and Back-Calculated Head Grades ........................................................... - 101 -
Table 9-13: Comparative Settling Tests using Anionic Flocculants NZ2132 and NZ2326.................................. - 101 -
Table 9-14: Summary of Bond Ball Work Indices ................................................................................................ - 102 -
Table 9-15: Gravity Gold Recovery at different P80s .......................................................................................... - 103 -
Table 9-16: Metal Accounting .............................................................................................................................. - 103 -
Table 10-1: Mineral Resource Database Statistics of B Shoot ........................................................................... - 106 -
Table 10-2: Mineral Resource Database Statistics of Zone 242 ......................................................................... - 107 -
Table 10-3: Mineral Resource Database Statistics of DMH ................................................................................ - 109 -
Table 10-4: Mineral Resource Database Statistics of I Zone .............................................................................. - 109 -
Table 10-5: Mineral Resource Database Statistics of Father Brown/Adoikrom .................................................. - 110 -
Table 10-6: Mineral Resource Database Statistics of Chichiwelli ....................................................................... - 111 -
Table 10-7: B Shoot Grade Shell Modelling Parameters .................................................................................... - 113 -
Table 10-8: Descriptions for Zone B Shoot Mineralised Domains ....................................................................... - 114 -
Table 10-9: Descriptions for Zone 242 Mineralised Domains ............................................................................. - 116 -
Table 10-10: I Zone Pit Grade Shell Modelling Parameters ................................................................................ - 118 -
Table 10-11: Summary Statistics of Composites against Raw Samples for Zone B Shoot ................................ - 122 -
Table 10-12: Summary Statistics of Composites against Raw Samples for Zone 242 ....................................... - 123 -
Table 10-13: Summary Statistics of Composites against Raw Samples for DMH .............................................. - 125 -
Table 10-14: Summary Statistics of Composites against Raw Samples for I Zone ............................................ - 125 -
Table 10-15: Zone B Shoot Au Grade Capping ................................................................................................... - 128 -
Table 10-16: Zone 242 Grade Capping ............................................................................................................... - 131 -
Table 10-17: DMH Grade Capping ...................................................................................................................... - 132 -
– IIIC-9 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1535 ---
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Contents    Final
SRK CONSULTING (CHINA) LTD.   28 FEBRUARY 2025  PX/AT x
Table 10-18: I Zone Grade Capping .................................................................................................................... - 134 -
Table 10-19: Capping Values Selected from Analysis of the Probability Plot ..................................................... - 135 -
Table 10-20: Chichiwelli Au Grade Capping ........................................................................................................ - 136 -
Table 10-21: Variogram Structure of Au for B Shoot Domain 5101 and 8101 .................................................... - 136 -
Table 10-22: Variogram Structure of Au for 242 Domain 1001 and 1101 ........................................................... - 138 -
Table 10-23: Variogram Structure of Au for DMH Domain 1001 and 2102 ......................................................... - 139 -
Table 10-24: Variogram Structure of Au for I Zone Domain 1003 and 2001 ....................................................... - 141 -
Table 10-25: Fitted Variogram Parameters for Au in FW for FBZ ....................................................................... - 145 -
Table 10-26: Fitted Variogram Parameters for Au in HG for FBZ ....................................................................... - 146 -
Table 10-27: Fitted Variogram Parameters for Au in HW for FBZ ....................................................................... - 146 -
Table 10-28: Fitted Variogram Parameters for Au in FW for ADK ...................................................................... - 149 -
Table 10-29: Fitted Variogram Parameters for Au in HG for ADK ....................................................................... - 150 -
Table 10-30: Fitted Variogram Parameters for Au in HW for ADK ...................................................................... - 150 -
Table 10-31: Fitted Major Variogram Directions in Original Space ..................................................................... - 150 -
Table 10-32: Variogram Parameters for Chichiwelli ............................................................................................ - 151 -
Table 10-33: Specifications of Zone B Shoot Block Model ................................................................................. - 151 -
Table 10-34: Attribute and Description of Zone B Shoot Block Model ................................................................ - 151 -
Table 10-35: Grade Estimation Parameters Used in Zone B Shoot .................................................................... - 152 -
Table 10-36: Specifications of Zone 242 Block Model ........................................................................................ - 152 -
Table 10-37: Attribute and Description of Zone 242 Block Model ....................................................................... - 153 -
Table 10-38: Grade Estimation Parameters Used in Zone 242 .......................................................................... - 153 -
Table 10-39: Specifications of DMH Block Model ............................................................................................... - 154 -
Table 10-40: Attribute and Description of DMH Model ........................................................................................ - 154 -
Table 10-41: Grade Estimation Parameters Used in DMH ................................................................................. - 154 -
Table 10-42: Specifications of I Zone Block Model ............................................................................................. - 155 -
Table 10-43: Attribute and Description of I Zone Model ...................................................................................... - 155 -
Table 10-44: Estimation and Search Parameters for I Zone ............................................................................... - 156 -
Table 10-45: FBZ Block Model Parameters ........................................................................................................ - 157 -
Table 10-46: ADK Block Model Parameters ........................................................................................................ - 157 -
Table 10-47: Kriging Search Parameters for Each Vein in Each Deposit ........................................................... - 157 -
Table 10-48: Chichiwelli Block Model Parameters .............................................................................................. - 157 -
Table 10-49: Chichiwelli Estimation Parameters ................................................................................................. - 158 -
Table 10-50: Comparison of Composites and Block Model (B Shoot) ................................................................ - 160 -
Table 10-51: Comparison of Composites and Block Model (242) ....................................................................... - 162 -
Table 10-52: Comparison of Composites and Block Model (DMH) ..................................................................... - 164 -
Table 10-53: Comparison of Composites and Block Model (I Zone) ................................................................... - 165 -
Table 10-54: Mineral Resource Statement, Wassa Project, as of 30 September 2024 ...................................... - 172 -
Table 10-55: Wassa Mineral Resource Statement, as of December 31 2020 .................................................... - 177 -
Table 10-56: Mineral Resource Statement of Wassa Main (UG), as of December 31 2021 .............................. - 178 -
Table 10-57: Mineral Resource Statement of Wassa Project, as of 31 December 2022 .................................... - 179 -
Table 11-1: Cut-off Grades and Parameters ....................................................................................................... - 181 -
Table 11-2: Ore Reserve Statement, Wassa Open Pit Mine, as of 30 September 2024 .................................... - 182 -
Table 11-3: Gold Cut-off Grade Calculation ........................................................................................................ - 183 -
Table 11-4: Stope Optimisation Parameters ....................................................................................................... - 184 -
Table 11-5: Dilution and Loss .............................................................................................................................. - 185 -
Table 11-6: Ore Reserve Statement, Wassa Underground Mine, as of 30 September 2024 ............................. - 186 -
Table 11-7: Combined Ore Reserve Statement of Wassa Mine as of 30 September 2024 by SRK Consulting
China Ltd ......................................................................................................................................... - 186 -
Table 12-1: DMH open pit Optimisation Parameters ........................................................................................... - 188 -
Table 12-2: Wassa OP Mining Production Schedule .......................................................................................... - 190 -
Table 12-3: Joint Sets Used for Stope Design .................................................................................................... - 193 -
Table 12-4: 570 Decline Stress Measurement .................................................................................................... - 193 -
– IIIC-10 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1536 ---
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Contents    Final
SRK CONSULTING (CHINA) LTD.   28 FEBRUARY 2025  PX/AT xi
Table 12-5: Wassa Rock Mass Characterization Parameters (Barton et al, 1974) ............................................. - 195 -
Table 12-6: Modified Stability Number (N’) for Panels 1-3, Transverse Stopes (Potvin, 1988) .......................... - 196 -
Table 12-7: Modified Stability Number (N’) for Panels 1-3, Longitudinal Stopes (Potvin, 1988) ......................... - 197 -
Table 12-8: Stable Stope Dimensions, Panels 1-8 .............................................................................................. - 200 -
Table 12-9: Wassa Underground Equipment List ................................................................................................ - 205 -
Table 12-10: Contractor Equipment List .............................................................................................................. - 205 -
Table 12-11: Development Tasks in Schedule .................................................................................................... - 205 -
Table 12-12: Stope Task in Schedule ................................................................................................................. - 206 -
Table 12-13: Ore Reserves Plan ......................................................................................................................... - 206 -
Table 12-14: Wassa Ore Reserves and Upside Plan .......................................................................................... - 212 -
Table 13-1: Wassa Gold Plant Historical Production Performance ..................................................................... - 220 -
Table 15-1: Gold Price Forecasts ........................................................................................................................ - 227 -
Table 16-1: Key Environmental Approvals Obtained for Wassa Mine ................................................................ - 230 -
Table 17-1: Summary of Capex for Wassa Mine ................................................................................................. - 239 -
Table 17-2: Consolidated Capital Expenditure (Sunk and Forecast) over LOM ................................................. - 239 -
Table 17-3: Capitalisation over the LoM .............................................................................................................. - 240 -
Table 17-4: Capital Development Meters over the LoM ...................................................................................... - 240 -
Table 17-5: Other Sustaining Capex over the LoM ............................................................................................. - 240 -
Table 17-6: Operating Costs from 2022 to 2024 Q3 ........................................................................................... - 241 -
Table 17-7: Operating Unit Costs from 2022 to 2024 Q3 .................................................................................... - 242 -
Table 17-8: Operating Cost Forecast (Million USD) ............................................................................................ - 242 -
Table 17-9: Summary of Historical Opex for Wassa Mine .................................................................................. - 243 -
Table 17-10: Breakdown of Open Pit Mining Cost .............................................................................................. - 244 -
Table 17-11: Breakdown of Underground Mining Cost ....................................................................................... - 245 -
Table 17-12: Operating Development Meters over the LoM ............................................................................... - 246 -
Table 17-13: Breakdown of Processing Cost ...................................................................................................... - 247 -
Table 17-14: Breakdown of G&A Cost ................................................................................................................ - 247 -
Table 18-1: LOM Physical Inputs for Economic Analysis .................................................................................... - 250 -
Table 18-2: Gold Price Forecasts ........................................................................................................................ - 250 -
Table 18-3: LOM Profit, Loss & Cash Flow Forecasting ..................................................................................... - 251 -
Table 18-4: Wassa Mine NPV versus Discount Rate .......................................................................................... - 251 -
Table 18-5: Sensitivity Analysis Result ................................................................................................................ - 253 -
Table 18-6: Summary of Capex for Wassa Mine (Ore Reserves and Upside Plan) ........................................... - 254 -
Table 18-7: Operating Cost Forecast (Million USD) ............................................................................................ - 254 -
Table 18-8: Wassa Mine NPV versus Discount Rate .......................................................................................... - 254 -
Table 18-9: Sensitivity Analysis Result (Ore Reserves and Upside Plan) .......................................................... - 255 -
Table 19-1: Project Risk Assessment of the Wassa Gold Project ....................................................................... - 256 -

Figures
Figure 3-1: Location of Wassa Mine ...................................................................................................................... - 28 -
Figure 3-2: GSWL’s Mineral Properties Location in Ghana .................................................................................. - 29 -
Figure 6-1: Location of the Wassa Mine with the Geology of the Ashanti Belt ..................................................... - 42 -
Figure 6-2: Total Magnetic Intensity Reduced to Pole of the Ashanti Belt ............................................................ - 43 -
Figure 6-3: Compilation of Geochronology Dating from the Ashanti Belt .............................................................. - 44 -
Figure 6-4: Lithology of the Deposit Area .............................................................................................................. - 46 -
Figure 6-5: Vertical Section 19975N of the Wassa Main Deposit S howing Folded Nature of the Lithological
Sequence during the Eburnean D3 and D4 Deformational Events .................................................. - 47 -
Figure 6-6: Vertical Section 20000N of the Wassa Main Deposit Showing the Tabular Nature of Ore Zones ..... - 48 -
Figure 7-1: Layout of GSWL Mining Leases and Prospecting Licences Linked by Laterite Sheeted Haul Road
 ........................................................................................................................................................... - 54 -
Figure 7-2: Wassa Au-in-Soil Anomalies with Prioritised Targets and Deposits ................................................... - 55 -
– IIIC-11 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1537 ---
Independent Competent Person’s Report for Wassa Gold Mine, Akyempim, Western Region, Ghana
Contents    Final
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Figure 7-3: Layout of Wassa Airborne Magnetic Survey Coverage ...................................................................... - 56 -
Figure 7-4: Au-In-Soil Anomalies with Pit Outlines within the Benso Mining Lease .............................................. - 57 -
Figure 7-5: Gold in Soil Anomaly within Hwini Butre Mining Leas e with Adoikrom and Father Brown Open
Pits..................................................................................................................................................... - 59 -
Figure 7-6: Wassa Main Deposit Vertical Section 19975mN Showing Folded Lithological Sequence ................. - 61 -
Figure 7-7: Wassa Main Vertical Section 19925mN Showing Interpretation with Tight Spaced Drilling ............... - 61 -
Figure 7-8: Hwini Butre Drill Section through 33100 mN ....................................................................................... - 62 -
Figure 7-9: Transworld Laboratories Sample Processing Flow Sheet .................................................................. - 68 -
Figure 7-10: Intertek Sample Processing Flow Sheet ........................................................................................... - 69 -
Figure 7-11: ARD Plot Comparing Fire Assay and BLEG for Field Duplicates ..................................................... - 71 -
Figure 8-1: Correlation Plot of Coarse Reject Replicates and Original Assays .................................................... - 73 -
Figure 8-2: B Shoot CRM Samples Between 2023 and March 2024 .................................................................... - 76 -
Figure 8-3: B Shoot Blank Samples Between 2023 and March 2024 ................................................................... - 79 -
Figure 8-4: B Shoot Field Duplicates Between 2023 and March 2024 .................................................................. - 80 -
Figure 8-5: B Shoot Lab Check Duplicates Between 2023 and March 2024 ........................................................ - 81 -
Figure 8-6: 242 CRM Sample Between 2023 and March 2024 ............................................................................. - 82 -
Figure 8-7: 242 Blank Samples Between 2023 and March 2024 .......................................................................... - 82 -
Figure 8-8: 242 Field Duplicates Between 2023 and March 2024 ........................................................................ - 83 -
Figure 8-9: DMH CRM Samples Between 2023 and March 2024 ......................................................................... - 84 -
Figure 8-10: DMH Blank Samples Between 2023 and March 2024 ...................................................................... - 85 -
Figure 8-11: Correlation Plot of Coarse Reject Replicates and Original Assays .................................................. - 86 -
Figure 9-1: Locations of 2015 Metallurgical Samples (GSR, 2015) ...................................................................... - 88 -
Figure 9-2: Gold Deportment in Samples Using Diagnostic Leaching .................................................................. - 93 -
Figure 9-3: Scatter Diagram of the UCS and CWi Results with Relative Levels of Samples ................................ - 95 -
Figure 9-4: Plot of 2015 Ball Mill Bond Work Index Against Sample Depth .......................................................... - 96 -
Figure 9-5: Plot of 2015 Abrasion Index Against Sample Depth ........................................................................... - 97 -
Figure 10-1: DD and RC Holes Plane Projection Map of Zone B Shoot ............................................................. - 106 -
Figure 10-2: DD, RC and GCRC Holes Plane Projection Map of Zone 242 ....................................................... - 107 -
Figure 10-3: DD, RC and GC-RC Holes Plane Projection Map of DMH ............................................................. - 108 -
Figure 10-4: DD, RC and GCRC Holes Plan Projection Map of I Zone .............................................................. - 110 -
Figure 10-5: DD, RC and GCRC Holes Plan Projection Map of Father Brown/Adoikrom ................................... - 111 -
Figure 10-6: DD and RC Holes Plan Projection Map of Chichiwelli .................................................................... - 112 -
Figure 10-7: Structural Trend Surfaces Used for Wassa Grade Shell Modelling ................................................ - 113 -
Figure 10-8: Estimation Zones Used to Classify Mineralised Domains ............................................................... - 114 -
Figure 10-9: All Mineralised Domains for Zone B Shoot ..................................................................................... - 115 -
Figure 10-10: Mineralised Domains for Zone 242 ............................................................................................... - 116 -
Figure 10-11: Structural Surfaces Used in Mineralised Domain Modelling for DMH Pit ..................................... - 117 -
Figure 10-12: Mineralised Domains for DMH Pit ................................................................................................. - 118 -
Figure 10-13: Solid Models for I Zone ................................................................................................................. - 119 -
Figure 10-14: Model section at U=-28.0 in Transformed Space Generated with 2.0 Tolerance in V Direction .. - 120 -
Figure 10-15: Solid Models for Chichiwelli .......................................................................................................... - 121 -
Figure 10-16: Histogram of Interval Length for Zone B Shoot ............................................................................. - 122 -
Figure 10-17: Histogram of Interval Length for Zone 242 ................................................................................... - 123 -
Figure 10-18: Histogram of Interval Length for DMH ........................................................................................... - 124 -
Figure 10-19: Histogram of Interval Length for I Zone......................................................................................... - 125 -
Figure 10-20: CV Variations of Different Capping Grade for Each Domain (B Shoot) ........................................ - 126 -
Figure 10-21: CV Variations of Different Capping Grade for Each Domain (242) ............................................... - 129 -
Figure 10-22: CV Variations of Different Capping Grade for Each Domain (DMH) ............................................ - 132 -
Figure 10-23: CV Variations of Different Capping Grade for Each Domain (I Zone) .......................................... - 133 -
Figure 10-24: Au Grade Probability Plot with Outliers and Far Out Thresholds Highlighted............................... - 135 -
Figure 10-25: Variogram Model of Au for Domain 5101 ...................................................................................... - 137 -
Figure 10-26: Variogram Model of Au for Domain 8101 ...................................................................................... - 137 -
– IIIC-12 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1538 ---
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Contents    Final
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Figure 10-27: Variogram Model of Au for Domain 1001 ...................................................................................... - 138 -
Figure 10-28: Variogram Model of Au for Domain 1101 ...................................................................................... - 139 -
Figure 10-29: Variogram Model of Au for Domain 1001 ...................................................................................... - 140 -
Figure 10-30: Variogram Model of Au for Domain 2102 ...................................................................................... - 140 -
Figure 10-31: Variogram Model of Au for Domain 1003 ...................................................................................... - 141 -
Figure 10-32: Variogram Model of Au for Domain 2001 ...................................................................................... - 142 -
Figure 10-33: Inferred Nugget Effect for Au in Each Vein for FBZ ...................................................................... - 142 -
Figure 10-34: Fitted Experimental semi variogram Points for Au in FW for FBZ ................................................ - 143 -
Figure 10-35: Fitted Experimental semi variogram Points for Au in HG for FBZ ................................................ - 144 -
Figure 10-36: Fitted Experimental semi variogram Points for Au in HW for FBZ ................................................ - 145 -
Figure 10-37: Inferred Nugget Effect for Au in Each Vein for ADK ..................................................................... - 146 -
Figure 10-38: Fitted Experimental Semi Variogram Points for Au in FW for ADK .............................................. - 147 -
Figure 10-39: Fitted Experimental Semi Variogram Points for Au in HG for ADK ............................................... - 148 -
Figure 10-40: Fitted Experimental Semi Variogram Points for Au in HW for ADK .............................................. - 149 -
Figure 10-41: Au Grade for Zone B Shoot ........................................................................................................... - 152 -
Figure 10-42: Au Grade for Zone 242 ................................................................................................................. - 153 -
Figure 10-43: Au Grade for DMH ......................................................................................................................... - 155 -
Figure 10-44: Au Grade for I Zone ....................................................................................................................... - 156 -
Figure 10-45: Au Swath Plot for Domain 5101 of B Shoot .................................................................................. - 159 -
Figure 10-46: Au Swath Plot for Domain 8101 of B Shoot .................................................................................. - 159 -
Figure 10-47: Au Swath Plot for Domain 1001 of 242 ......................................................................................... - 161 -
Figure 10-48: Au Swath Plot for Domain 1101 of 242 ......................................................................................... - 161 -
Figure 10-49: Au Swath Plot for Domain 1001 of DMH ....................................................................................... - 163 -
Figure 10-50: Au Swath Plot for Domain 2101 of DMH ....................................................................................... - 163 -
Figure 10-51: Au Swath Plot for Domain 1003 of I Zone ..................................................................................... - 164 -
Figure 10-52: Au Swath Plot for Domain 2001 of I Zone ..................................................................................... - 165 -
Figure 10-53: B Shoot Measured Areas in both Plane and Section Map ............................................................ - 167 -
Figure 10-54: B Shoot Indicated Areas in both Plane and Section Map ............................................................. - 167 -
Figure 10-55: B Shoot Mineral Resource Classification Distribution ................................................................... - 168 -
Figure 10-56: 242 Mineral Resource Classification Distribution .......................................................................... - 169 -
Figure 10-57: DMH Mineral Resource Classification Distribution ....................................................................... - 169 -
Figure 10-58: I Zone Mineral Resource Classification Distribution ..................................................................... - 170 -
Figure 10-59: Mineral Resource Classification Distribution For FBZ/ADK .......................................................... - 171 -
Figure 10-60: DMH Grade Tonnage Curve ......................................................................................................... - 174 -
Figure 10-61: I Zone Grade Tonnage Curve ....................................................................................................... - 175 -
Figure 10-62: 242 Grade Tonnage Curve ........................................................................................................... - 176 -
Figure 10-63: B Shoot Grade Tonnage Curve ..................................................................................................... - 177 -
Figure 11-1: Relationship Between Mineral Resources and Ore Reserve .......................................................... - 180 -
Figure 11-2: Stope Optimisation Results (View from West) ................................................................................ - 185 -
Figure 12-1: An Isometric View of the DMH Open Pit Shell from the Optimisation Practice ............................... - 189 -
Figure 12-2: DMH Practical Open Pit Design General View ............................................................................... - 190 -
Figure 12-3: Wassa Underground Mining Areas (Zone 242 and Zone B Shoot) ................................................ - 192 -
Figure 12-4: Stereonet Plot of Wassa Joint Set Database .................................................................................. - 193 -
Figure 12-5: Principal Stress Measurement Magnitude vs Depth ....................................................................... - 194 -
Figure 12-6: Support, Barton’s Q-Index Chart (Barton and Grimstad, 1993) ...................................................... - 196 -
Figure 12-7: Matthews Stability Graph, Transverse Stopes (Mathews et al, 1981) ............................................ - 198 -
Figure 12-8: Matthews Stability Graph, Longitudinal Stopes (Mathews et al, 1981) ........................................... - 199 -
Figure 12-9: Matthews Stability Graph, Longitudinal Stopes (Mathews et al, 1981) ........................................... - 199 -
Figure 12-10: Longitudinal View Showing the Main Crown Pillar ........................................................................ - 200 -
Figure 12-11: B Shoot Pillars, Modelled Factors of Safety from Phase 2 Software, (GSR, 2018) ..................... - 201 -
Figure 12-12: Schematic of Primary Transverse Stope (Illustration Not to Scale) .............................................. - 203 -
Figure 12-13: Wassa Underground Development Design (Looking East) .......................................................... - 204 -
– IIIC-13 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1539 ---
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Contents    Final
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Figure 12-14: Backfill system proposed by Kovit ................................................................................................. - 208 -
Figure 12-15: Phase 2 Ventilation System .......................................................................................................... - 209 -
Figure 12-16: Final Dewatering ........................................................................................................................... - 210 -
Figure 12-17: Stope comparison between Wassa Design and Updated Wassa Design .................................... - 211 -
Figure 12-18: Wassa Underground Life of Mine Design (Looking East) ............................................................. - 214 -
Figure 12-19: Wassa Underground Life of Mine Decline Design (Looking East) ................................................ - 215 -
Figure 13-1: Current Process Flowsheet for GSWL ............................................................................................ - 218 -
Figure 13-2: Photo of Wassa Processing Plant ................................................................................................... - 221 -
Figure 14-1: Reclaimed TSF 1 ............................................................................................................................. - 223 -
Figure 14-2: TSF 2 Cells ...................................................................................................................................... - 224 -
Figure 14-3: Catchment Ponds in Wassa Mine Site ............................................................................................ - 225 -
Figure 14-4: Main Transformer Station ................................................................................................................ - 226 -
Figure 17-1: Capex Investment Plan over LOM .................................................................................................. - 239 -
Figure 17-2: Pie Chat of Percentage for Wassa Mine Opex ............................................................................... - 243 -
Figure 17-3: Operating Costs for historical three-year (in ‘000USD) ................................................................... - 244 -
Figure 18-1: Cash Flow Profile ............................................................................................................................ - 252 -
Figure 18-2: Sensitivity Spider Chart ................................................................................................................... - 253 -
Figure 18-3: Sensitivity Spider Chart (Ore Reserves and Upside Plan) .............................................................. - 255 -

Appendices
Appendix A Table 1 (JORC)
Appendix B Wassa Life of Mine
Appendix C Compliance with Chapter 18
Appendix D Chapter 2.6 of the Guide for New Listing Applicants





– IIIC-14 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Useful Definitions    Final
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Useful Definitions
This list contains definitions of symbols, units, abbreviations, and terminology that may be unfamiliar to the reader.
% Percent/percentage
/ Per
′ Minute of arc
° Degree(s) of arc
°C Degree(s) Centigrade
3D Three-dimensional
2020 PEA  Preliminary Economic Assessment of potential expansion of the underground mine to extract the
Inferred Mineral Resource in the Southern Extension zone (dated 2020)
AAS  Atomic adsorption spectroscopy (sample assay)
AC  Air-core (drilling)
ADK  Adoikrom and Dabokrom (deposit)
Ag The chemical symbol of silver element
Ai  Bond abrasion index (metallurgical testing)
AIG Australian Institute of Geoscientists
AISC All in sustaining cost
ALS  ALS Minerals
ARD  Acid rock drainage
ARO  Asset retirement obligations (closure planning)
ASL Above sea level
Au The chemical symbol of gold element
AusIMM Australasian Institute of Mining and Metallurgy
BDG  BD Goldfields (company)
BIF Banded iron formation
BLEG  Bulk leach extractable gold (assaying)
BWi  Bond ball mill work index (metallurgical testing)
Capex Capital expenditure, or capital cost
Chifeng Gold Chifeng Jilong Gold Mining Co., Ltd.
CIL  Carbon in leach (processing method)
CIM  Canadian Institute of Mining, Metallurgy and Petroleum
CMCC  Community Mine Consultative Committee
Conc. Concentrate
CP Competent Person, or Chartered Professional
– IIIC-15 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
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Useful Definitions    Final
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CPR Competent Person’s Report
CRM  Certified reference material (sample QA/QC)
CSL  Compacted soil liner (civil construction)
CSR corporate social responsibility
Cut-off grade The grade threshold above which a mineral material is considered potentially economic and is
selectively mined and processed as ore
CWi  Bond low impact crushing work index (metallurgical testing)
CYAP  Community Youth Apprenticeship Program
DCF discounted cash flow
DMH Dead Man’s Hill
DD  Diamond (core) drilling
EIA  Environmental Impact Assessment
EIS  Environmental Impact Statement
EMP  Environmental Management Plan
EMS  Environmental and social management system
EPA  Environmental Protection Agency (Ghana)
ESR  Excavation support ratio (geotechnical)
FAusIMM Fellow of the AusIMM
FB  Father Brown (deposit)
FOS  Factor of safety
FS  Feasibility study
FW  Footwall
g gram
G&A  General and administration
GAI  Geochemical abundance index (geochemistry)
GC  Grade control
Ghana Republic of Ghana
g/t gram per tonne
GSI  Geological strength index (geotechnical)
GSOPP  Golden Star Oil Palm Plantation
GSR / Golden Star Golden Star Resources (Ghana) Ltd
GSSTEP  Golden Star Skills Training and Employability Program
GSWL  Golden Star Wassa Limited
Halo the mineralisation halo
– IIIC-16 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
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Useful Definitions    Final
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HARD  Half absolute relative difference (statistics)
HBB  Hwini Butre Benso (deposit group)
HBM  Hwini Butre Minerals (company)
HG  High grade
HKEx Stock Exchange of Hong Kong Limited
HL  Heap leach (processing/hydrometallurgical method)
HW  Hanging wall
ICOLD  International Committee on Large Dams
ICMC International Cyanide Management Code
IFC International Finance Corporation
ILR  In-line reactor (processing method)
Indicated Mineral Resource
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 testing 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
Inferred Mineral Resource
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 assumed but not verified geological and/or grade continuity.  It is based on
information gathered through appropriate techniques from locations such as outcrops, trenches,
pits, workings, and drill holes which may be limited or of uncertain quality and reliability
IP
Induced Polarization, which is an exploration technique whereby an electrical current is pulsed
through the ground and the response from the sub surface measured in order to identify minerals
of interest.  Strong IP responses may be a result of sulphide which may be associated with gold
mineralisation
IPO Initial Public Offering
IRR internal rate of return
ITCZ Inter Tropical Convergence Zone
Jn  Joint number (geotechnical)
JORC Code Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves,
2012 edition, as published by the Joint Ore Reserves Committee.
JORC Committee Joint Ore Reserves Committee of The Australasian Institute of Mining and Metallurgy, Australian
Institute of Geoscientists and Minerals Council of Australia
Jr  Joint roughness (geotechnical)
Jw  Joint alteration (geotechnical)
kg kilogram(s), equivalent to 1,000 grams
kg/t kilogram(s) per tonne
km kilometre(s), equivalent to 1,000 metres
km2 square kilometre(s)
koz thousand ounces
kt Thousand tonne(s)
ktpa Thousand tonne(s) per annum
kV kilovolt(s)
kW kilowatt(s)
kWh/t kilowatt(s) hour per tonne
– IIIC-17 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Useful Definitions    Final
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L.I.  Legal Instrument
LG  Low grade
LHD load-haul-dump machine
LHOS  Long hole open stoping (mining method)
LOM (or LoM) Life of mine
LR (model)  Long-range model (geological modelling)
LVA  Locally variable anisotropy (geological modelling)
m Meter(s)
MAIG Member of the AIG
MAusIMM Member of the AusIMM
Measured Mineral Resource
A Measured 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
Mineral Resources
A concentration or occurrence of material of intrinsic economic interest in or on the earth’s crust in
such form, quality and quantity that there are reasonable prospects for eventual economic
extraction, as defined in JORC Code.  The location, quantity, grade, geological characteristics and
continuity of a mineral resource are known, estimated or interpreted from specific geological
evidence and knowledge
mm/yr Millimetre(s) per year
MOU  Memoranda of Understanding
M.Eng. Master of Engineering
M.Sc. Master of Science
MSG  Modified Stability Graph (geotechnical)
MSO  Mineable Stope Optimiser (mine planning)
Mt million tonnes (metric tons)
NAG  Not acid generating (geochemistry)
NI 43-101 National Instrument 43-101, which is a national instrument for the (Canadian) Standards of
Disclosure for Mineral Projects, including Companion Policy 43-101 as amended from time to time.
NPV  Net present value
OHS occupational health and safety
OK  Ordinary kriging (grade estimation)
OP open pit
Opex operating cost
Ore Reserves
The economically mineable part of a Measured and/or Indicated mineral resource.  It includes
diluting materials and allowances for losses which may occur when the material is mined.
Appropriate assessments and studies have been carried out including consideration of and
modification by realistically assumed mining, processing, metallurgical, infrastructure, economic,
marketing, legal, environmental, social and government factors, as defined in the JORC definition
standards.  These assessments demonstrate at the time of reporting that extraction could
reasonably be justified.  Ore Reserves are sub-divided in order of increasing confidence into
Probable Ore Reserves and Proved Ore Reserves
oz Ounce
PCP  Practical closure plan (closure planning)
PRC People’s Republic of China
– IIIC-18 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Probable Ore Reserve
A Probable Ore Reserve is the economically mineable part of an Indicated, and in some
circumstances Measured Resource.  It includes diluting materials and allowances for losses which
may occur when the material is mined.  Appropriate assessments, which may include feasibility
studies, have been carried out including consideration of and modification by realistically assumed
mining, processing, metallurgical, infrastructure, economic, marketing, legal, environmental, social
and governmental factors.  These assessments demonstrate at the time of reporting that
extraction could reasonably be justified
Proved Ore Reserve
A Proved Ore Reserve is the economically mineable part of a Measured Resource.  It includes
diluting materials and allowances for losses which may occur when the material is mined.
Appropriate assessments, which may include feasibility studies, have been carried out, and
include consideration of and modification by realistically assumed mining, processing,
metallurgical, infrastructure, economic, marketing, legal, environmental, social and governmental
factors.  These assessments demonstrate at the time of reporting that extraction could reasonably
be justified.
PVC  Poly-vinyl chloride
Q Quarter: a fixed period of three months
QA/QC  Quality assurance, quality control
RAB  Rotary air blast (drilling)
RC  Reverse circulation (drilling)
RGI  Ryal Gold Inc (company)
RGLD  RGLD Gold AG (company)
RL  Reduced level
RMR  Rock mass rating (geotechnical)
RMS  Resource Modelling Solutions (company)
ROM  Run of mine
RPEEE  Reasonable prospects for eventual economic extraction
RQD  Rock quality description (geotechnical)
SGL  Satellite Goldfields Limited (company)
SJR  Saint Jude Resources (company)
SR (model)  Short-range model (geological modelling)
SRK SRK Consulting China Ltd.
t Tonne(s)
TMM Total material movement
TSF  Tailings storage facility
UCS  Unconfined compressive strength
UG underground
US$  United States dollar/s, same as USD
VAT value-added tax
VRA  Volta River Authority (Ghana)
WGM / Wassa Mine Wassa Gold Mine
WRD waste rock dump
WSL  Wassa site laboratory (assaying)
WUC  Western University College, Tarkwa (Ghana)
WUG  Wassa underground mine
XRD  X-ray diffraction
XRF  X-ray fluorescence

– IIIC-19 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Executive Summary    Final
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Executive Summary
SRK Consulting China Ltd. (“SRK”) was requested by Golden Star Wassa Limited (“GSWL”, the
“Company” or the “Client”) to prepare a Competent Person’s Repo rt (“CPR” or the “Report”) for its
mining property (the “Project”) in the Republic of Ghana (“Ghana”) in accordance with the guidelines
of the Australasian Code for Reporting Exploration Results, Min eral Resources and Ore Reserves,
2012 edition (the “JORC Code”, 2012 edition) and the Rules Gove rning the Listing of Securities on
the Stock Exchange of Hong Kong Limited (the “HKEx”), including the Chapter 18 requirements
(Appendix C), Chapter 2.6 of the Guide for New Listing Applican ts (Appendix D) and other relevant
regulations of the HKEx. GSWL’s primary asset is the Wassa Gold  Mine (the “Wassa Mine” or
“WGM”), and 90% equity interest of GSWL is owned by Golden Star  Resources (Ghana) Ltd.
(“Golden Star” or “GSR”) which is a direct subsidiary of Chifeng Jilong Gold Mining Co., Ltd. (“Chifeng
Gold”), and the Ghanaian government owns the remaining 10% equity interest of GSWL.
This Report consists of an independent review of the geology, exploration, Mineral Resources, Ore
Reserves, mining, mineral processing, capital expenditure, oper ating cost, and environmental and
social aspects of the Project. It is understood that the Report will enable potential equity investors
and possible future shareholders to understand the Project’s operations.
This Report does not express an opinion as to the value of mineral or other assets involved.
Property Description and Ownership
The mineral concessions belonging to GSWL are listed below.
 Wassa mining lease: The Wassa Mine is an operating gold mine co mprising principally
underground operations with the following mineralisation domains: F Shoot, 419, B Shoot, Zone
242, Starter, South-East, Mid-East, and Dead Man’s Hill (the “DMH”).
 Benso mining lease: comprising th e Subriso East, Subriso West, G-Zone, C-Zone, and I-Zone
deposits.
 Hwini Butre mining lease: comprising the Father Brown, Adoikrom, and Dabokrom deposits.
 Benso (Chichiwelli) exploration pr operty: comprising two minera lised zones, Chichiwelli West,
and Chichiwelli East.
 Manso exploration property: located east of the Benso and Hwini Butre Concessions.
The properties and leases are spread along a trend of approxima tely 80 kilometres (km) southwest
of the Wassa Mine. There are sufficient access and surface rights for GSWL’s operations.
Geology and Mineralisation
The Wassa Mine property lies within the southern portion of the  Ashanti Greenstone Belt along the
eastern margin of the belt within a volcano-sedimentary assemblage proximal to the Tarkwaian basin
contact. The eastern contact between the Tarkwaian basin and the volcano-sedimentary rocks of the
Sefwi group is faulted, but the fault is discrete as opposed to the Western contact of the Ashanti belt
where the Ashanti fault zone can be several hundred meters wide . Deposition of the Tarkwaian
sediments was followed by a period of dilation and the intrusion of late mafic dykes and sills.
– IIIC-20 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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The lithologies of the Wassa assemblage predominantly comprise mafic to intermediate volcanic
flows which are interbedded with minor horizons of volcaniclast ics, clastic sediments such as
wackestone and magnetite-rich sedimentary layers, most likely banded iron formations (“BIF”). The
volcano-sedimentary sequence is intruded by syn-volcanic mafic intrusives and felsic porphyries.
The Wassa deposit is located on the eastern flank of the northe ast trending Ashanti Belt, a
Paleoproterozoic greenstone belt which was formed and deformed, along with the dividing Birimian
and Tarkwaian sedimentary basins during the Eoeburnean and Ebur nean orogeny. Most deposits
found within the Ashanti belt can be classified as lode gold de posits or orogenic mesothermal gold
deposits, except for the Tarkwaian paleoplacer deposits which have a sedimentary origin. Orogenic
gold deposits are the most common gold systems found within Arc hean and Paleoproterozoic
terrains, in the West African shield, and these deposits are typically underlain by geology considered
to be of Eoeburnean age (2164 ± 22 Ma) and are generally hosted  by volcano-sedimentary
sequences.
Host rocks in the Wassa mine area have been affected by at least four phases of ductile deformation,
producing a polyphase fold pattern at the mine scale. Discrete high-strain zones locally dissect this
fold system. The structural history of the Wassa area is import ant in that the various deformational
events have been responsible for the emplacement of the gold mineralisation as well as the geometry
of the zones themselves.
Mineralised zones at the Wassa Mi ne are related to vein swarms and associated sulphides that
formed during the Eoeburnean defor mational event. All rock type s underlying the Wassa Mine
appear to be altered to variable degrees with the most common alteration consisting of a carbonate-
silica-sulphide assemblage.
The Wassa mineralisation is subdivided into a number of domains, namely: F Shoot, B Shoot, Zone
242, South-East, Starter, 419, M id-East, and DMH. Each of these  represents discontinuous
segments of the main mineralised system. The South Akyempim (SA K) deposits are located
approximately 2 km to the southwest of the Wassa Main deposit on the northern end of a well-defined
mineralized trend parallel to the Wassa Main trend. The mineral isation is hosted in highly altered
multi-phased greenstone-hosted qua rtz-carbonate veins interlaced with sedimentary pelitic units.
The SAK mineralisation is subdivided into a number of domains as well, SAK 1, 2, and 3.
Mineralisation within the Wassa Mine is structurally controlled  and related to vein densities and
sulphide contents. The mineralisation generally consists of bro adly tabular zones containing
dismembered and folded ribbon-like bodies of narrow quartz vein  material. Three vein generations
have been distinguished on the basis of structural evidence, ve in mineralogy, textures and
associated gold grades.
Gold grades broadly correlate with the presence of quartz-dolom ite/ankerite-tourmaline-bearing
quartz veins and the presence of sulphide minerals (predominant ly pyrite) within and around the
quartz veins. Gold grades appear to be spatially restricted to the quartz veins, vein selvages and the
immediate wall rocks. The alteration haloes developed around the veins and pervasively developed
within the core of the Wassa Fold contain lower grade mineralisation.
According to the grade assays in various exploration campaigns and historic processing production
records, both silver (Ag) and arsenic (As) are in relatively low content. In the Wassa Project, gold is
the only prime element, and there is no concern about harmful mineral or element such as arsenic.
– IIIC-21 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Executive Summary    Final
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Exploration
Systematic exploration work has been conducted on the GSWL properties over a couple of centuries
as the earliest record of gold business within the Hwini-Butre mining lease dates back to the late 15th
century with the Portuguese colonial explorers. Evidence of col onial mining and local small-scale
mining still remains with pits and adits mapped within all the mining leases and prospecting licenses.
Drilling is carried out by a combination of Diamond Drill (“DD”), Reverse Circulation (“RC”) and Rotary
Air Blast (“RAB”) techniques. In general, the RAB method is used at early stages for follow up to soil
geochemical sampling and testing contacts and mineralisation ex tensions around the production
areas and has a maximum drilling depth of around 30 meters (m).
The Wassa, Benso, and Hwini Butre Mining Leases are advanced pr operties, and details of all drill
results have been reported in early staged reports. Recent upda ted technical reports provided an
overview of drilling and representative plans and cross-sections.
DD and RC drilling are used as the main method for obtaining sa mples for Mineral Resource
estimation and the resource drilling at Wassa deposit; and the drilling is generally carried out along
drill lines spaced between 25 and 50 m along prospective structures and anomalies defined from soil
geochemistry and RAB drilling. RC drilling is typically extended to depths in the order of 100-125 m.
The DD method is used to obtain more detailed geological data where such information is required.
Generally, the deeper intersections are also drilled using DD a nd as a result, most section lines
contain a combination of RC drilling and DD.
Mineral Resource Estimates
Mineral Resource Estimates conducted for the Project include underground (“UG”) mines and open
pits (“OP”). SRK has reviewed the drill hole database, definiti on of mineralisation domains, grade
estimate parameters based on the received data and information for the footprints of Wassa Main (B
Shoot UG and 242 UG), DMH, and Benso’s I Zone OP. The wireframe  and block models were
compiled by GSR personnel and SRK performed validations on thes e models. The reporting of
validated Mineral Resource models was done by SRK. Through cros s check and validation of the
procedure and key parameters, SRK is of the opinion that the reviewed models and Mineral Resource
estimates have been performed in line with a standard approach which is generally accepted by
international practice.
At Wassa Main’s B Shoot UG deposit, the database with a total o f 4,240 DD and RC holes with
aggregated drilling length of 781,448 m was used to model and e stimate the Mineral Resources.
Mineralised domains were created and estimated using indicator approach and set parameter.
Wireframes for mineralised zone(s) were modelled with a cut-off at 0.4 gram per tonne gold (g/t Au)
for the low grade (“LG”) or the mineralisation halo (the “Halo”) domain, and a cut-off at 1.2 g/t Au for
the high grade (“HG”) or the Mineralised domain. SRK has reviewed and cross validated the sample
composition and sample outliers outlined for grade estimation. Variograms were modelled and the
Ordinary Kriging (“OK”) method was used for grade estimation.
At Wassa Main’s 242 UG deposit, the database with a total of 4, 601 DD and grade control (“GC”)
RC boreholes with aggregated drilling length of 143,655 m were used for wireframe modelling and
grade estimation. The mineralised domains are constrained within two envelopes (the “Halo” and the
– IIIC-22 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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“Mineralised”) using semi-explicit method. The Halo Zone was modelled at a cut-off grade of 0.4 g/t
Au with Leapfrog™ vein modelling technique. The Mineralized Zone was modelled at a cut-off grade
of 1.0 g/t Au, with the same method as the Halo Zone.  Variogra ms were modelled accordingly for
each domain and the OK method was used for grade estimation.
At DMH deposit, a total of 2,137 DD and GC RC holes with an agg regated drilling length of 73,039
m were used in domain modelling and grade estimation. The domains (zone) were modelled using
the intrusive technique in Leapfrog™ software by GSR. The Halo Zone was modelled at a cut-off
grade of 0.4 g/t Au and the Mineralized Zone was generated with a cut-off of 1.0 g/t Au. Variograms
were modelled and the OK method was applied for grade estimation.
I Zone Pit is within the Benso open pit mine. The database for I Zone Pit contained 254 DD and (GC)
RC holes totalling 15,574 m. The solid model of I Zone Pit was constructed by GSR with Leapfrog™
vein modelling technique. The intervals used in the veins model ling were generated by Leapfrog™
implicit modelling technique, at a cut-off of 0.5 g/t Au. Assay data was composited to 2 m by GSR for
statistics, estimation and model validation. The OK method was used for grade estimation.
With respect to Father Brown (FB)/ Adoikrom and Dabokrom (ADK) and Chichiweilli Zone, the
Mineral Resources as of 30 September 2024 remain unchanged from the statement presented in the
NI 43-101 Technical Report (issued in March 2021). A drilling program was initiated at Father Brown/
Adoikrom during 2022-2023, and 10,287.4m of drilling has been c ompleted at Father-Brown/
Adoikrom. This additional drilling information has not been included in the resource estimate.
Below is a summary of GSWL’s Mineral Resource Statement as of 3 0 September 2024, in
accordance with JORC Code classifications.
Table ES-1: GSWL Mineral Resource Statement, as of 30 September 2024
Deposit/Category
Tonnage Grade Contained Au Contained Au
kt Au g/t koz t
DMH OP
Measured 393 1.24 16 0.49
Indicated 155 1.20 6 0.19
Measured and Indicated 548 1.23 22 0.67
Inferred 19 1.25 1 0.02
I Zone OP
Measured 37 1.28 2 0.05
Indicated 21 1.65 1 0.03
Measured and Indicated 58 1.41 3 0.08
Inferred 1 1.22 0.03 0.00
Chichiwelli OP
Measured
Indicated 1,110 1.75 62 1.94
Measured and Indicated 1,110 1.75 62 1.94
Inferred 50 2.22 4 0.11
FB/ADK UG
– IIIC-23 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Executive Summary    Final
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Deposit/Category
Tonnage Grade Contained Au Contained Au
kt Au g/t koz t
Measured
Indicated 1,310 7.96 335 10.42
Measured and Indicated 1,310 7.96 335 10.42
Inferred 2,660 5.30 454 14.12
242 UG
Measured 44 4.10 6 0.18
Indicated 177 2.68 15 0.47
Measured and Indicated 221 2.97 21 0.66
Inferred 42 2.38 3 0.10
B Shoot UG
Measured 6,251 3.09 621 19.32
Indicated 7,210 2.52 585 18.18
Measured and Indicated 13,461 2.79 1,206 37.51
Inferred 58,122 3.29 6,147 191.18
Stockpile (Measured)             DMH Stockpile 26 1.19 1 0.03
UG Stockpile 4 2.31 0 0.01
Total
Measured 6,754 2.97 646 20.08
Indicated 9,984 3.13 1,004 31.24
Measured and Indicated 16,738 3.07 1,650 51.32
Inferred 60,893 3.38 6,609 205.53
Total 77,631 3.31 8,258 256.85
Notes:
1 The Mineral Resource is reported in accordance with the JORC Code guidelines.
2 The information in this report which relates to Mineral Resourc e is based on information comp iled by Mr Huaixiang Li and
Mr Pengfei Xiao who are full time employees of SRK Consulting. Mr Huaixiang Li is a Member of the Australian Institute of
Geoscientists (the “AIG”) and Mr Pengfei Xiao is a Member of th e Australasian Institute of Mining and Metallurgy (the
“AusIMM”) and a Member of the AIG. Both Mr Li and Mr Xiao have sufficient experience which is  relevant to the style of
mineralisation and the type of deposits under consideration and to the activity which they are undertaking to qualify as the
“Competent Persons” as defined in JORC Code (2012).  Mr Li and Mr Xiao consent to the reporting of this information in
the form and context in which it appears.
3 Mt – million tonnes (metric tons), oz- ounce; koz – thousand ounces.
4 Mineral Resources for B Shoot and 242 underground deposits are reported within mineable stope optimiser (the “MSO”).
5 Open Pit Mineral Resources are reported at a cut-off grade of 0.43 g/t for DMH, 0.73 g/t for I Zone and 0.55 g/t for Chichiwelli.
6 Underground Mineral Resources are reported at a cut-off grade of 1.34 g/t for B Shoot and 242; and 1.40 g/t for FB/ADK.
7 FB/ADK and Chichiwelli Mineral Resources were sourced from the Wassa NI 43-101 Technical Report (March 2021), based
on a US$1,500/ ounce (oz) gold price. No material change has been aware since then.
8 All composites have been capped where appropriate.
9 All figures are rounded to reflect the relative accuracy of the estimate.
10 It should be noted that the Mineral Resource Statement is made for GSWL on the basis of 100% ownership of the properties.
11 The conversion between ounce and gram used herein is 1 oz = 31.1035 g.
12 Mineral Resources are inclusive of Ore Reserves that have been converted from Measured and Indicated Mineral
Resources.
13 The Mineral Resources Statement as of 30 September 2024 is based on the mineral resource models as of 31 March 2024
and the depletion for the Wassa Mine for the six-month period, 1 April 2024 to 30 September 2024.
– IIIC-24 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Ore Reserve Estimates
SRK has estimated the Ore Reserves of Wassa Mine for open pit a nd underground, and stockpiles
and reported them in compliance with the JORC Code guidelines.  The Ore Reserve statement for
GSWL as of 30 September 2024 is in Table ES-2.
The total Ore Reserve for the Wassa Mine is estimated at about 8,842 thousand tonnes (“kt”) at an
average grade of 2.12 g/t Au, containing approximately 603 thou sand ounces (“koz”) of gold. This
includes Proved Ore Reserve estimated at 3,521 kt with an average grade of 2.14 g/t gold, containing
242 koz of gold; and Probable Ore Reserve estimated at 5,291 kt  at an average grade of 2.12 g/t
gold, containing 360 koz of gold.  The stockpiles are the ores t hat have spilled from conveyor belts
and accumulated over time and are subsequently returned to the run of mine (ROM) Pad.
Table ES-2: Combined Ore Reserve Statement of Wassa Mine as of 30 September 2024
Deposit/Category Category
Tonnage Au Grade Contained Au Contained Au
kt Au g/t koz t
Open Pit Proved 183 0.97 6 0.18
 Probable 355 0.90 10 0.32
  Total 538 0.92 16 0.50
Underground Proved 3,339 2.20 237 7.36
 Probable 4,935 2.20 349 10.87
  Total 8,274 2.20 586 18.23
Stockpile
(Measured) DMH Stockpile 25.98 1.19 1.00 0.03
  UG Stockpile 3.68 2.31 0.27 0.01
Total Proved 3,521 2.14 242 7.53
 Probable 5,291 2.12 360 11.19
 Stockpile 30 1.33 1.27 0.04
  Total 8,842 2.12 603 19

Notes:
1 The Ore Reserve Statement as of 30 September 2024 is based on t he ore reserve models as of 31 March 2024 and the
depletion for the Wassa Mine for the six-month period, 1 April 2024 to 30 September 2024.
2 The Ore Reserve is reported in accordance with the JORC Code guidelines.
3 The information in this report which relates to Ore Reserve is based on information compiled by Mr. Alexander Thin and Ms.
TzuHsuan Chuang who are full time employees of SRK Consulting. Mr. Thin is a Fellow of the Australasian Institute of
Mining and Metallurgy (the “AusIMM”), and Ms. Chuang is a Membe r of the AusIMM. Both Mr. Thin and Ms. Chuang have
sufficient experience which is relevant to the style of mineralisation and the type of deposits under consideration and to the
activity which they are undertak ing to qualify as the “Competen t Persons” as defined in JORC (2012).  Mr. Thin and Ms.
Chuang consent to the reporting of this information in the form and context in which it appears.
4 Ore Reserves in the table above and in this Report are estimate d/converted from Measured and Indicated Mineral
Resources, therefore double accounting of tonnage should be avoided.
Open pit
1 Ore Reserves are reported at a cut-off grade of 0.5 g/t Au.
2 Ore Reserves are reported with modifying factors.
Underground
1 Ore Reserves are reported at a cut-off grade of 1.34 g/t Au.
2 Ore Reserves are reported with M odifying Factors. (Development Overbreak: 5%; Stope Recovery: 95%; Stope Dilution:
10%)
– IIIC-25 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
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Mining
Open Pit Mining
The mining at Wassa Main area was initiated mostly by open pit in 2001, with underground
development commencing in 2015. The underground and open pit mi ning continued at the Wassa
Main deposit while the underground mining has been the main ore  source since 2018. From these
domains, DMH and Benso (I Zone) are currently two open pits while others are depleted or planned
for underground mining.
A final open pit design utilised a gold price of United State D ollars (USD or US$) 2,050 / oz, with
optimised angles of 45° and 52° for the oxide and fresh rock ma sses, respectively. Detailed
engineering design was based on the following nominal bench and berm configurations:
 Oxides: Bench height: 6 m, bench face angle: 65°, berm width: 4 m (Inter-ramp angle:41°).
 Fresh Rocks: Bench height: 12 m, bench face angle: 75°, berm wi dth: 4 m (Inter-ramp angle:
59°).
The overall final open pit design slopes are stable; however, the main geotechnical problem at Wassa
historically has been lack of berm retention due to the well jo inted nature of the rock mass and the
relatively narrow berms required to achieve steep inter-ramp angles.
A conventional mining method is utilised; excavators and trucks  which is considered typical for this
type and style of gold mineralisation. The mining is carried ou t by a contract mining company who
supply suitable mining equipment, manpower and supervision services. The 12 m bench heights with
72° bench face angle were designed while drilling and blasting will be conducted over bench heights
of 6 m and explosives delivered to the hole by the manufacturer . Oxide or weathered material is
generally only required to be lightly blasted or in some areas can be excavated as ‘free dig’. Hydraulic
excavators are used in conjunction with conventional blasting practices, to mine a 3.0 m flitch height.
Broken rock is loaded into 60 t capacity off highway haul trucks to a central stockpile or to the waste
dump.
Geovia MineSched™ software is used by GSR to plan the open pit production schedule. All criteria
as detailed in the mining section of this Report has been emplo yed plus 10% dilution and 5% ore
loss to the gold grade and ore amount to make up the production schedule.
Underground Mining
The Wassa Underground Mine commenced development in 2015 and de clared commercial
production in January 2017 when the open pits operation was nea rly completed. The Long Hole
Open Stoping (“LHOS”) is the selected method for Wassa underground mining.  In this method the
stopes are mined with blastholes drilled vertically upwards, from the level below. The primary stope
is extracted in a top-down sequence; and each stope lift is ext racted below the open stope void
above. Up to three stope lifts are extracted to create a contin uous excavation up to 75 m high.
Primary stope length is 20 m and by the width of the orebody with 20 m pillars left between, with the
pillars to be mined as secondary stopes after filling the voids  with waste rocks or by paste filling.
When the voids are filled with pas te material, the secondary stopes are mined in a bottom-up
sequence to minimize paste exposure in the sidewalls. The prima ry stopes will be filled when the
– IIIC-26 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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four stopes are extracted but i n secondary stopes each stope li ft is planned to be filled before
extracting the lift above. A sill pillar is then left when the stope excavations are up to 100 m high.
The underground mine is accessed via declines from within the completed open pit mines and then
access to surface via the available open pit ramps. There are three portals and surface facilities. The
main portal named the Daniel Owiredu Portal, located in Starter Pit at approximately 905 m Reduced
Level ("RL"). This portal is used as the main entrance to the underground mine. Portal 2 was
established in the southern end of the Main Pit at approximately 845 m RL and connects to the main
decline at 820 m RL. Duplication of the main decline forms part  of a haulage loop system. Portal 3
was established within the 242 open pit, at approximately 930 m RL. This portal gives access to the
242 mine.
The mining method depends on the orebody thickness and grade di stributions for each panel. In
panels 1 & 3, the mined voids are generally left open with some  loose rock fill, to dispose of waste
or for opportunistic pillar reco very. Narrower ore zones (<15 m ) are mined as longitudinal stopes
(>25 m length) with progressive placement of rock fill to minim ize ore loss in pillars. In panel 2, the
voids will be filled with paste material when primary stopes were mined out, to allow the extraction of
the pillars between secondary stopes. Also, in this panel the s ill pillars can be extracted after the
secondary stopes are backfilled. The si ll pillar extraction ass umes 60% recovery of the full stope.
Secondary stopes follow the primary stope front with a lag dist ance of between 120-140m along
strike to create a sufficient buffer from active primary stopes; and development and extraction of the
sill pillar commences when there is a sufficient distance from secondary stopes in the blocks above
and below.
GSWL completed the mining product ion schedule (including mine o ptimisation, design and
scheduling), referred to as version #13 (the “Wassa Design”), a nd was reviewed by SRK. The
production schedules based on the Wassa Design, and is shown in Table ES-3 below, which forms
the Ore Reserve reporting for the Wassa Project.
Table ES-3: Wassa Life of Mine Plan (Based on Wassa Design)
Mine Production
& Development Unit Total 2024 Q4 2025 2026 2027 2028
OPEN PIT
Ore Tonnes t 538,041 79,981 458,061
Au Grade g/t 0.92 1.08 0.90
Au Metal oz 15,965 2,767 13,198 - - -
Waste Tonnes t 1,681,405 635,265 1,046,140
Total Material
Movement
t 2,219,446 715,246 1,504,200
UNDERGROUND
Ore Tonnes t 8,274,022 899,306 2,750,799 2,516,877 1,614,222 492,818
Au Grade g/t 2.20 2.20 2.13 2.29 2.24 2.05
Au Metal oz 585,981 63,647 187,961 185,510 116,452 32,411
Waste Tonnes t 2,236,924 395,939 1,123,668 574,812 132,779 9,726
Total Material
Movement
t 10,510,946 1,295,246 3,874,466 3,091,689 1,747,002 502,543
– IIIC-27 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Mine Production
& Development Unit Total 2024 Q4 2025 2026 2027 2028
Total (OP + UG)
Ore Tonnes t 8,812,064 979,287 3,208,859 2,516,877 1,614,222 492,818
Au Grade g/t 2.12 2.11 1.95 2.29 2.24 2.05
Au Metal oz 601,946 66,414 201,159 185,510 116,452 32,411
Waste Tonnes t 3,918,329 1,031,205 2,169,807 574,812 132,779 9,726
Total Material
Movement
t 12,730,392 2,010,492 5,378,667 3,091,689 1,747,002 502,543
Development
Meters

Lateral Operating
Development
m 15,480 4,333 5,372 3,945 1,635 194
Lateral Capital
Development
m 20,140 3,121 11,067 5,123 828 -
Vertical Capital
Development
m 1,448 220 733 414 82 -
Backfill
Pastefill m3 2,128,352 187,178 678,193 731,515 449,982 81,484
Rockfill t 1,653,541 72,271 592,791 358,842 341,201 288,436
Source: SRK
Notes: Scheduling start date: 1 April 2024
Mineral Processing
The ores of Wassa Mine are amenable to cyanide leaching. The processing plant adopts gravity and
carbon-in-leach (“CIL”) process to extract gold, and the gold r ecovery is higher as 95% to 97% in
recent years production.
The current plant circuit for GSWL is capable of processing up to 3.5 Mtpa of total mill feed, while
the processing capacity may decrease with the increase of the p rimary ore feed. The underground
ore (fresh or primary ore) is the major source of feed into the plant whilst a blend of surface material
may be added depending on availability in a ratio that averaged at 67% (OP) and 33% (UG) for 2021,
87% and 13% for 2022, and 83% and 17% for 2023, respectively. The surface ore may contain
transition ore in addition to the oxides. Despite these average  blend ratios, there will also periods
that underground ore may be the sole feed into the plant based on the mining schedule. The blending
ratio is maximised by the grade control to maintain recoveries at optimal levels throughout each year.
The processing flowsheet to treat ores from both open pit and underground operations in the Wassa
Project has been proved to be mature. Recovery methods in the p rocessing plant and forward
recovery assumptions are supported by test work and plant histo ry. The designed processing plant
capacity is able to accommodate all mined ores from the mining production in all years of the life of
mine (the “LoM”) for the Ore Reserve plan, therefore no plant u pgrades nor additional processing
production lines are required to process the mine production plan.
There are no material risks identified in relation to the tailings and water balance in this Project.
– IIIC-28 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Environmental and Social Aspects
The Wassa Mine has obtained relevant environmental permits for its operations, including the
environmental permit, environmental certificate, water use perm its for dewatering and water
abstraction for domestic purposes, mining, processing and dust suppression activities, as well as
discharge. Two environmental imp act statements for the expansio n project and the No.2 tailings
storage facility (“TSF 2”), dat ed March 2016 and September 2015  respectively, were reviewed by
SRK. The Wassa project's haulage route crosses 12 km within the  Subri River Forest Reserve, but
it does not impact the reserve's Globally Significant Biodivers ity Area, according to the Project
Expansion Environmental Impact St atements (“EIS”). Dewatering w ater is partially reused to
supplement fresh water for underground mining operations and th e processing plant, with the
remainder being discharged. All processing wastewater is recycl ed internally and not released
externally. The project conducts comprehensive environmental monitoring regularly, covering water
quality, cyanide content, noise, and dust emissions. The monito ring results are generally within the
reporting limits. GSWL is a member of International Cyanide Management Code (“ICMC”), and Eagle
Environmental conducted the most recent certification audit in April 2023.
GSWL actively engaged in a range of corporate social responsibi lity (“CSR”) strategies, such as
Stakeholder Engagement planning and consultation, foster harmon ious relationships and
coexistence with local communities, supporting community skills  training, and contributions to
foundations. Moreover, it offers a variety of employment opport unities for residents in the local
communities. In the first three quarters of 2024, the direct GSWL related CSR funding amounted to
an investment of approximately US$278,214 in their host communities.
GSWL encounters a challenge with small-scale artisanal mining activities (“galamsey”), particularly
in the Hwini-Butre and Benso (HBB) concessions. GSWL intensified its security monitoring activities
to drive away galamsey miners that operated close to its mining areas, and local law enforcement is
engaged when necessary. Several stakeholder meetings were condu cted with opinion leaders and
youths from both Wassa and HBB communities, especially those involved in galamsey, emphasizing
the importance of refraining from such actions to preserve reha bilitated sites and the environment.
GSWL is of the opinion that galamsey around Wassa Mine has litt le potential to impact current or
future operations, since the Benso, located about 40-50 km from the Wassa Main (the primary mining
operation) and Hwini-Butre, located about 80km from the Wassa M ain, have had most of its
economically viable surface resources extracted rendering it la rgely irrelevant to the Company’s
ongoing mining operations.
Capital Cost and Operating Cost
The capital expenditures (the “Capex”) for deeper development (depth extension to the current mine)
and sustainability are estimated by GSWL. The Wassa Mine has relative stable operations, allowing
the forecasting of operating ex penses (the “Opex”) based on his torical records and current
performance. All the Capex and Opex are calculated and reviewed  in USD basis. The summary of
Capex is presented in Table ES-4 below.
– IIIC-29 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Table ES-4: Summary of Capex for Wassa Mine
Capex Unit LOM Total
Capital Development Million USD 78
Other Sustaining Capex Million USD 100
Closure Million USD 27
Total Capex Million USD 205
Sources: Wassa Mine, summarized by SRK
SRK has received two sets of costing data: one from Chifeng Gro up for the annual report and the
other from Wassa Mine. The first set is organized by cost elements, while the second is grouped by
activities. SRK has summarized both sets of data and used the first set, grouped by cost elements,
as the input for the Technical Economic Model (TEM). Table ES-5 shows the total cost and unit cost
of each category.
Table ES-5: Summary of Opex Historical & Forecasted for Wassa Mine
Item Unit 2022 2023 2024 Q3 Unit Cost TEM Input
Labor USD/t 15.00 14.03 13.02 13.99 20.99
Material USD/t 27.63 20.27 28.46 25.21 37.82
Electricity USD/t 3.79 7.34 3.92 5.13 7.70
Contractors USD/t 0.84 4.20 1.49 2.29 3.43
Engineering USD/t 2.01 3.64 1.75 2.52 3.78
Service USD/t 0.69 0.68 1.11 0.83 1.24
Safety USD/t - - - - -
Repairment USD/t - - - - -
Others USD/t 3.30 - 0.14 1.05 1.58
Taxes and surcharges USD/t 6.25 7.04 8.36 7.23 7.23
Selling costs USD/t - - - - -
G&A costs USD/t 9.64 6.65 5.55 7.20 9.35
R&D costs USD/t - - - - -
Sources: Wassa Mine, summarized by SRK
Project Economics
The economic analysis was conducted using conventional Discount ed Cash Flow (“DCF”)
techniques. The Net Present Value (“NPV”) was determined from the project's cash flow using a 10%
discount. It should be noted that SRK’s DCF modelling and NPV calculation are carried out with the
purpose of testing the “economic viability” of the Project which is required to be reasonable for Ore
Reserve reporting.
The cash flow estimate includes only the revenue, costs, taxes, and other factors directly associated
with the Project. The assumptions are as follows:
 The currency used for the Project is US dollars.
 Annual gross revenue is calculated by applying the estimated go ld price and payables to the
annual recovered metal for each operating year.
 The “nominal” values are applied. SRK does not consider future inflation of currency or cost
fluctuations; the cost remains constant over the LoM without any adjustments are factored in.
– IIIC-30 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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 Financing is assumed to be on a 100% equity basis; no debt or related financing costs have been
included in the technical economic analysis.
 Neither corporate obligations nor financing costs is considered.
 Sustaining capital for future exploration, which is aimed at di scovering additional Mineral
Resources that is outside the Ore Reserves estimates, is not considered during this analysis, as
the current project economic analysis has not employed any additional potential tonnage or grade.
 No salvage value has been included in the technical economic analysis.
 The reference date or effective date is 30 September 2024.
The projection for Ore Reserve (only) plan shows a positive eco nomic prospect. At a discount rate
of 10%, the NPV of the Project is USD 168 million, which is shown in Table ES-6.
Table ES-6: Wassa Mine NPV versus Discount Rate
Discount Rate (%) NPV (Million US$)
5% 182
6% 179
7% 176
8% 173
9% 170
10% 168
11% 165
12% 163
13% 160
14% 158
15% 155
Source: SRK
SRK conducted a single-factor sensitivity analysis for the Project to determine which factors most
significantly impact its economics when considered independentl y. The analysis focused on gold
price, Capex, and Opex, each tested within a ±30% range. The re sults showed that the Project is
most sensitive to changes in gold prices.
The break-even gold prices occur when the gold price drops by a pproximately 20%, resulting in an
NPV of USD 0 at a 10% discount rate.
Risk Assessment
The results of the risk assessment rating are presented in Table ES-7 below. The rating of the risks
is presented before implementation of control recommendations.
Table ES-7: Project Risk Assessment of the Wassa Gold Project
Risk Source/Issue Likelihood Consequence Overall
Geology and Resource
Lack of Significant Mineral Resources Unlikely Moderate Low
Overestimate of Mineral Resource Grade  Possible Moderate Mediu m
– IIIC-31 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
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Risk Source/Issue Likelihood Consequence Overall
Unknown Significant Geological Structure Unlikely Moderate Low
Mining
Subsidence and Ground Stability Unlikely Moderate Low
Hydrogeological Modeling Uncertainties Possible Minor Low
Significant Production Shortfalls Unlikely Major Medium
Lack of Significant Ore Reserves Unlikely Major Medium
Unexpected Groundwater Ingress Possible Moderate Medium
Ore Processing
Significantly Lower Recovery Unlikely Moderate Low
Higher Processing Cost Possible Moderate Medium
Poor Plant Reliability Unlikely Moderate Low
Capital and Operating Costs
Project Timing Delays Unlikely Moderate Low
Capital Cost and Operating Cost Increases Possible Moderate Med ium
Higher Mine Closure Liability Possible Moderate Medium
Environmental, Social and Governance
Water Management Possible Moderate Medium
Waste Rock and TSF Management Possible Moderate Medium
Hazardous Materials Management Unlikely Moderate  Low
Social Licensee to Operate Possible Moderate Medium
Infrastructure
Poor TSF Management Unlikely Moderate Low
Shortfall of Water Supply Possible Moderate Medium
Shortfall of Power Supply Possible Moderate Medium
Poor Condition of the Site Road Possible Minor Low
The Wassa Project is an operating project with constant open pi t and open pit production. The
geology, mining methods and metallurgical flowsheet have been p artly verified and proved by
historical operation. Overall ratings of technical risks of the  Project are low and some medium risks
exist in different aspects. The risks and recommended management measures are discussed below.
 The geological risks relate to the uncertainty of underground hydrogeology associated with local
geological structures. SRK recommends to maintaining and enhancing the geological exploration,
such as mapping the underground tunnels, especially for faults and fractures, and monitoring the
underground water discharges.
 The geological risks also related to the grade estimation of underground Mineral Resources. SRK
noted there are abundant Inferred Mineral Resources for the und erground mine and further
exploration potential, and the cu rrent Inferred Mineral Resourc es in deeper zones have been
estimated on primarily drill core  interceptions with sparse dis tance so there is possibility of
underestimate or overestimate. S RK recommends continuous explor ation to be carried out for
the upgrade the underground Mineral Resources.
 The risk in relation to mining could be possible poor planning, as it is an underground mine with
a relatively high production rate. Consequently, possible risk will result to production shortfall or
Ore Reserve overstatement. SRK recommends carrying out in-depth  engineering studies
associate to LoM planning and the use of professional mine plan ning software. Professional
services may be sourced and retained, if needed.
– IIIC-32 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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 The risk in relation to ore processing and metallurgy could be the possibility of high operating
cost, as the current production is transitioning from undergrou nd production solely. Proper
management in grade control and planning will help reduce operating costs.
 The measures and practices to manage environmental risks relati ng to surface water and
groundwater may include separate drainage systems for productio n wastewater, domestic
sewage, and stormwater systems; storage of hazardous materials in a dedicated area could be
planned to control the risk of hazardous materials pollution. T he environmental risk of land
disturbances could be controlled by limiting the waste rock storage and other disturbances; scrap
iron and other industrial waste collection and recycling activi ty may control the risks resulting
from waste generation. SRK notes  a conceptual closure plan shou ld be updated with ceasing
open pit production and further underground operation. TSF mana gement associates to social
responsibility, and should be taken into account.
The risks in relation to capital and operating costs include un derestimates of project costs. Proper
management and detailed mine scheduling may help the underground development of the Project in
a proposed schedule. SRK recommends updating or adjusting the p roject’s costs estimation from
time to time according to production data in the future. It is SRK’s opinion that the risks identified
above are generally under control and not likely to develop int o higher level of risks, as noted the
Company and Wassa Project team has tracked record in production and risk management.
Conclusions and Recommendations
Conclusions
Geology and Exploration
 The Wassa deposit can be classified as an Eoeburnean folded vein system and is the only such
deposit recognised to date within the Ashanti belt.
 The core drilling, geological logging etc. are implemented to a  standard ensuring that the
gathered data and information adequately underpin the objective s of subsequent geological
modelling and Mineral Resources estimations.
 The procedures for sampling, preparation, analysis, and QA/QC a re following the industry
standards. SRK considers that they are acceptable for Mineral Resources estimations.
Mineral Resources Estimation
The Mineral Resources have been prepared in accordance with the JORC Code guidelines. Mining
is assumed by open pit methods at DMH, I Zone and Chichiwelli, and underground methods at
Wassa (242 and B Shoot) and Hwini Butre (FB/ADK).
The Mineral Resources have a RPEEE, with estimates constrained as follows:
 Open Pit: constrained by open pit shell and cut-off grade.
 Underground (FB/ADK): constrained by cut-off grade.
 Underground (242 and B Shoot): constrained by the MSO.
As of 30 September 2024, the Mineral Resources are estimated as:
– IIIC-33 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
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 Measured and Indicated Mineral Resource: 16.74 Mt at 3.07 g/t, containing 1,650 koz gold.
 Inferred Mineral Resources: 60.89 Mt at 3.38 g/t, containing 6,609 koz gold.
Metallurgical Testing and Recovery Method
 Metallurgical tests were carried out before and after the const ruction of the processing plant in
2004. Both oxide and fresh ores h ave negligible preg-robbing ef fect and are amenable to CIL
process. The gold recovery of Gravity-CIL process is as high as 90% to 95%.
 The capacity of the processing plant is 2.7 Mtpa. A traditional Crushing-Milling-CIL process with
assistance of Gravity-Acacia operation in milling circuit is applied. The plant is well managed and
achieved good historical performance. The gold recovery is 95.3% to 97.1% with gold production
(in gold doré bars) of 4.84 to 5.31 tons per year.
Infrastructure
 The rehabilitation of TSF 1 is complete and is operated by the GSOPP for palm oil trees. The
construction and management of TSF 2 is conducted properly. The  planed extension of TSF 2
can meet the required capacity for tailings storage.
 The current two electricity resources (Ghanian grid power and mine generated) are sufficient for
operations and domestic needs. If the solar system is implemented, it could significantly reduce
power costs for offices and domestic use.
 The water balance is carefully managed. The facilities of backw ater, surface water and
underground water can fully support the operations of mining and processing.
Recommendations
SRK has made a number of recommendations during the review and/or site visits which have been
discussed among SRK consultants and client staff. Key recommendations include:
 The large Inferred Mi neral Resources need drilling programs. SR K understands that the
Company is working on a long-term exploration and production pl an for the Project, and the
current Inferred Mineral Resources will be upgraded in next few years.
 Improve the quality of grade control model and incorporate it i nto the Mineral Resource/ Ore
Reserve model. The current grade control model has not been inc orporated in to Mineral
Resource/ Ore Reserve model yet due to various reasons includin g grade-control sample data
quality and the duration of model update. SRK is aware of that the Company has already started
to work on the improvement of both models.
 Exploration potential and opportunities to be further analysed.
 Additional technical studies to examine the Measured and Indicated Mineral Resources excluded
from the current Ore Reserve estimate. SRK understands that GSWL recently commissioned a
third party to work with the Company’s mining team in this regard.
 Further test works on the deep underground veins may be needed to assure the processing
procedures and laboratory protocols being used are appropriate and suitable. This will be
dependent on future exploration programs and technical studies.
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 It is a feasible plan for using renewable energy such as solar to replace gradually the electricity
used in offices and residential facilities, as the concept of decarbonisation has been considered
by the Company.

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Introduction    Final
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1 Introduction
SRK Consulting China Ltd. (“SRK”) was requested by Golden Star Wassa Limited (“GSWL”, the
“Company” or the “Client”) to prepare a Competent Person’s Repo rt (“CPR” or the “Report”) for its
mining property (the “Project”) in the Republic of Ghana (“Ghana”) in accordance with the guidelines
of the Australasian Code for Reporting Exploration Results, Min eral Resources and Ore Reserves,
2012 edition (“JORC Code”) and the Rules Governing the Listing of Securities on The Stock
Exchange of Hong Kong Limited (the “HKEx”), including the Chapter 18 requirements (Appendix C),
Chapter 2.6 of the Guide for New Listing Applicants (Appendix D ) and other relevant regulations of
the HKEx. GSWL’s primary asset is the Wassa Gold Mine (the “Was sa Mine” or “WGM”), and 90%
equity interest of GSWL is owned by Golden Star Resources (Ghana) Ltd (“Golden Star” or “GSR”)
which is a direct subsidiary of Chifeng Jilong Gold Mining Co.,  Ltd. (“Chifeng Gold”), and the
Ghanaian government owns the remaining 10% equity interest of GSWL.
This Report consists of an independent review of the geology, e xploration, Mineral Resources, Ore
Reserves, mining, mineral processing, capital expenditure (“Capex”), operating expenses (“Opex”),
and environmental and social aspects of the Project.  It is und erstood that the Report will enable
potential equity investors and possible future shareholders to understand the Project’s operations.
This Report does not express an opinion as to the value of mineral or other assets involved.
– IIIC-36 –
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2 Program Objectives and Work Program
2.1 Purpose of the Report
The purpose of this Report is to provide both existing Chifeng Gold shareholders and potential
investors with a CPR of the Wassa Gold Mine, located near the v illage of Akyempim in the Wassa
East District in the Western Region of Ghana. The SRK’s report is proposed to provide an unbiased
technical assessment of the risk and opportunities associated with the Project.
2.2 Scope of Work and Reporting Standard
2.2.1 Scope of Work
The scope of work, as defined in letters of engagement executed in May 2024 between Golden Star
and SRK, includes the preparation of a CPR in compliance with t he JORC Code and the listing
requirements of the HKEx. This work typically involves the assessment of the following key aspects
of this project:
 Geology and exploration review;
 Review of exploration data quality;
 Review of Mineral Resource estimation and validation;
 Review of Ore Reserves and mining assessment;
 Ore processing flowsheet and mineral recovery assessment;
 Environmental, social aspects and permitting review;
 Preliminary economic analysis; and
 Interpretation and Conclusions.
2.2.2 Basis of Technical Report
This report is based on information collected by the SRK Team during the period of the review from
April to June 2024, among which a site visit has been performed, and the technical review has also
included additional information provided by Golden Star through out the course of the SRK Team s
investigations.
The SRK Team has exercised due care and checked the supplied information according to the team’s
experience and best knowledge of the Project. SRK has no reason  to doubt the reliability of the
information provided by Golden Star. Other information was obta ined from the public domain.
Besides information collected during the SRK Team’s site visits, this technical report is based on the
following sources of information:
 Data provided by Golden Star prior to the site visit;
 Discussions with Golden Star personnel;
 Inspection of the open pit and underground operations;
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 Review of additional exploration data and Mineral Resource mode ls supplied by Golden Star;
and
 Additional information from public domain sources.
This report has been prepared to accommodate the requirements o f HKEx, and the Mineral
Resources and Ore Reserves are reported according to the JORC C ode (2012) which is binding
upon all members of the Australasian Institute of Mining and Me tallurgy (“AusIMM”) and the
Australian Institute of Geoscientists (“AIG”).
2.2.3 Site Visit
Four site visits were carried out by SRK with assistance from G olden Star personnel during
preparation of the Report.
 December 7 to 10, 2022, by geologist, geotechnical engineer, pr ocessing engineer and
environment scientist;
 January 10 to 14, 2023, by mining engineer and underground geotechnical engineer;
 February 11 to 16, 2024, by geologist; and
 May 27 to 29, 2024, by geologist, mining engineer, processing e ngineer and environmental
consultant.
2.2.4 Reporting Standard
This Report has been prepared to the standard of, and is consid ered by SRK to be, a Technical
Assessment Report under the guidelines of the 2015 edition of the Code for Technical Assessment
and Valuation of Mineral Petrol eum Assets and Securities for In dependent Expert Reports (the
“Valmin Code”). The Valmin Code incorporates the JORC Code for the reporting of Mineral
Resources and Ore Reserves and is binding upon all the Australa sian Institute of Mining and
Metallurgy (“AusIMM”) members.
This Report is not a Valuation Report and does not express an o pinion as to the value of mineral
assets. Aspects reviewed in this Report do include product pric es, socio-political issues and
environmental considerations; however, SRK does not express an opinion regarding the specific
value of the assets and tenements involved.
In this Report, identified Mineral Resources and Ore Reserves a re quoted using categorisation in
accordance with the JORC Code.  However, it should not be assumed that these Mineral Resource
and Ore Reserve Estimates have necessarily been carried out in accordance with the guidelines and
recommendations laid out in the JORC Code, at least until furth er documentation can be obtained
on the estimates and they have been formally endorsed by a “Competent Person” in accordance with
the JORC Code.
2.3 Limitations Statement
SRK is not professionally qualified to opine upon and/ or confi rm the Client’s ownership of its
underlying tenement and/ or the Client has any unresolved legal  matters relating to any transfer of
– IIIC-38 –
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ownership or associated fees and royalties. SRK has therefore a ssumed that there are no legal
impediments regarding the existence of the relevant tenements and that the Client has legal right to
all underlying tenements as purported. Assessing the legal tenures and rights to the prospects of the
Client and or any of its subsidiary companies are the responsibility of legal due diligence conducted
by entities other than SRK.
2.4 Effective Date
The effective date for this CPR is deemed to be 30 September 20 24 (the “Effective Date”).  The
Mineral Resource and Ore Reserve statements set out in this CPR are reported as of 30 September
2024 and represent the Mineral Resources and Ore Reserves at the Effective Date as audited by
SRK.
The life of mine (the “ LoM”) plans and associated technica l and economic parameters included in
the LoM plans and technical and economic models all commence on 1 April 2024.
2.5 Work Program
The technical review was jointly undertaken by SRK as well as SRK Consulting Practises in Ghana
and South Africa (collectively t he “SRK Team”). The technical r eview involves multiple disciplines
covering all fundamental aspects including geology, Mineral Res ource estimation, Ore Reserve
estimations, mining, processing, environmental and social assessment as well as project evaluation.
The Mineral Resource statement reported herein is a collaborati ve effort between Golden Star and
SRK personnel. The exploration database and Mineral Resource mo dels were compiled and
maintained by Golden Star, and audited by the SRK Team.
The geological model and wireframes for the gold mineralisation  were constructed by Golden Star.
In the opinion of SRK, the geological model is a reasonable rep resentation of the distribution of the
targeted mineralisation at the current level of sampling. The r eview of geostatistical analysis,
variography and grade models were completed by the SRK Team during April and June 2024.
The review of Modifying Factors including mining and processing  operations, underground design
and constructions, environmental and social assessment, infrastructure, capital expenditure and
operating costs were conducted by the SRK Team.
The draft version of technical report was jointly compiled by the SRK Team from April to June 2024.
2.6 SRK Experience
The SRK Consulting Group (“SRK Consulting”) is an independent, international consulting practice
that provides focused advice and solutions to clients, mainly f rom earth and water resource
industries. For mining projects, SRK Consulting offers services  from exploration through feasibility,
mine planning, and production to mine closure.
Among the company’s more than 1,500 clients are most of the world’s major and medium-sized metal
and industrial mineral mining houses, exploration companies, banks, petroleum exploration.
– IIIC-39 –
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Formed in 1974 in Johannesburg, South Africa, SRK Consulting no w employs more than 1,800
professionals internationally in 42 permanent offices across 20 countries on six continents. A broad
range of internationally recognised associate consultants complements the core staff.
SRK Consulting employs leading specialists in each field of science and engineering. Its seamless
integration of services, along with its global base, has made t he company a world leader in due
diligence, feasibility studies, and confidential internal reviews.
SRK Consulting’s independence is ensured by the fact that it holds no equity in any project and that
its ownership rests solely with its staff. This enables the company to provide its clients with objective,
conflict-free recommendations on crucial judgement issues.
SRK China was established in 2005 and has three offices located in Beijing, Nanchang and Kunming.
Either independently or together with other SRK Consulting offi ces—especially SRK Australasia,
SRK has been providing independent technical services for the C hinese mining companies. SRK
has considerable experience at providing Independent Expert Rep orts for mining companies who
have successfully listed on the stock exchanges in Hong Kong, Australia, United Kingdom, Canada,
South Africa and the United States.
SRK has provided dozens of independent technical reports for th e Chinese mining companies who
have completed successfully list ed and/or acquired on the Stock  Exchange of Hong Kong Ltd., as
shown in Table 2-1.
Table 2-1: SRK’s Reports f or Listing on the HKEx
Company Year Nature of Transaction
Yanzhou Coal Limited (listed in HKEx) 2000 Sale of Jining III co al mine to the listed operating company
Chalco (Aluminium Corporation of
China) 2001 Listing on HKEx and New York Stock Exchange
Fujian Zijin Gold Mining Group 2004 IPO Listing on HKEx
Lingbao Gold Limited 2005 IPO Listing on HKEx
Yue Da Holdings Limited (listed in
HKEx) 2006 Acquisition of shareholding in mining projects in Yunnan,
China
China Coal Energy Company Ltd
(China Coal) 2006 IPO Listing on HKEx
Sino Gold Mining Limited 2007 Dual Listing on HKEx
Xinjiang Xinxin Mining Industry Co.,
Ltd 2007 IPO Listing on HKEx
Kiu Hung International Holding Limited 2008 Acquisition of shareholding in coal projects in Inner Mongolia,
China
Hao Tian Resource Group Limited 2009 Very Substantial Acquisition of two coal mines in Inner
Mongolia, China
Green Global Resources Holdings Ltd 2009 Very Substantial Acquisition of shareholding in one iron project
in Mongolia
Ming Fung Jewellery Group Holdings
Ltd 2009 Acquisition of shareholding in gold project in Inner Mongolia,
China
Continental Holdings Limited 2009 Acquisition of a gold project in Henan, China
North Mining Shares Company Limited 2009 Acquisition of a molybde num mining project in Shaanxi, China
– IIIC-40 –
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Company Year Nature of Transaction
CNNC International Ltd 2010 Acquisition of a uranium mine in Africa
Sino Prosper Mineral Products Ltd 2010 Acquisition of shareholdings in one gold project in Inner
Mongolia, China
New Times Energy Corporation Ltd 2010 Acquisition of shareholding  in gold projects in Hebei, China
United Company RUSAL Limited 2010 IPO Listing on HKEx
Citic Dameng Holdings Limited 2010 IPO Listing on HKEx
China Hanking Holdings Limited 2011 IPO Listing on HKEx
China Daye Non-Ferrous Metal Mining
Limited 2012 Very Substantial Acquisition on HKEx
China Nonferrous Mining Corporation
Limited 2012 IPO Listing on HKEx
Hengshi Mining Investments Limited 2013 IPO Listing on HKEx
Future Bright Mining Holdings Limited 2014 IPO Listing on HKEx
King Stone Energy Group Limited 2014 Acquisition of Shareholding in silver mines in Fujian, China
Agritrade International Pte LTD 2015 Acquisition of Shareholding  in one coal mine in Indonesia
China Unienergy Group Limited 2016 IPO Listing on HKEx
Pizu Investment Co. Ltd 2020 Acquisition of Shareholding in a polymetallic project in China
China Qinfa Group Limited 2021 Annual disclosure of coal mines in Shanxi, China
China Graphite Group Limited 2022 IPO Listing on HKEx
Kinetic Development Group 2022 Major transaction of equity interest in Ningxia Sunshine
Persistence Resources Group Ltd 2023 IPO Listing on HKEx
2.7 Project Team
The SRK team contributed to this Report includes consultants as follows.
Pengfei Xiao, MSc, MAusIMM, MAIG,  is the Managing Director of SRK China. He is a Principal
Consultant (Geology) with a specialty in mineral exploration applying comprehensive geological and
geophysical methods; and his expertise also includes resource modelling and estimation as well as
project evaluation in the past 15 years. He is familiar with bo th theory and practice in sampling,
sample preparation and chemical analysis. As a consulting geoscientist, he has been active in over
200 projects including due diligence reviews, exploration desig n, data verification, resource
estimation, project evaluation and technical studies in over 60  countries. His experience relates
precious metal (Au, Ag, PGE), base metal (Cu, Ni, Pb, Zn) and other metal deposits (Fe, Mn, V, Mo,
Co), and also includes a few non-metal projects (phosphorite, p otash, gypsum). Mr Pengfei Xiao is
the Project Manager and Competent Person for this Report and takes overall responsibility of the
SRK team. Mr Xiao has been actively involved in the project assessment since 2022.
Huaixiang (Hubert) Li, MEng, MAIG, is a senior consultant (geology) with SRK China. He graduated
from the China University of Geo sciences (Beijing). He has been  worked in the China Railway
Resources Group for 6 years and has gained lots of experiences and expertise in geological and
mineral resources exploration. He is familiar with the Chinese principles and methods for metal ore
deposits prospecting and exploration including gold, silver, co pper, lead, zinc, molybdenum and
– IIIC-41 –
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bauxite. He is proficient in geological modelling, mineral and ore resources estimation, data
processing and GIS/RS application. Besides, he also has 5 years  experiences in project
management. Mr Hubert Li assists Mr Xiao in geology and Mineral Resource review and he is the
Competent Person who evaluates t he Mineral Resources in this Project. He visited the Wassa
Project in May 2024.
Ivan Doku, Pr Eng (South Africa), MSAIMM, Principal Resource Geologist and Country Manager
for SRK Ghana. Ivan’s expertise is in due diligence studies and  Mineral Resource estimation. With
16 years’ experience spanning a range of commodities including gold, PGEs, and base metals, he
has worked as a mine geologist at Driefontein Gold Mine, and as a resource geologist at South Deep
Gold Mine. At SRK, Ivan has been involved with due diligent aud its of several Mineral Assets,
compilation of MREs, assay QA/QC analysis within South Africa a nd Africa in general. He has as
acted as Competent/Qualified Person for mining projects and ope rations on multiple technical
studies. Ivan is registered as a Professional Natural Scientist  with the South African Council for
Natural Scientific Professionals (Reg: 400513/14). Ivan holds a BSc in Geological Engineering, MSc
and GDE in Civil and Mining Engineering respectively. Mr Ivan Doku reviewed the Mineral Resource
estimation of the Project and he performed the site visit in February 2024.
Paul Blaber , Associate Geological consultant  SRK Consulting Ghana. Paul’s expertise is in
generative exploration, exploration development and due diligen ce studies. With 20 years ’
experience, mostly in gold and limited base metals in DRC and Cote D'Ivoire, working as Exploration
geologist with Red Back Mining Inc in Ghana and Mauritania, Exp loration geologist with Newmont
Gold Ghana at Ahafo North, AVOCET Mining PLC in Guinea and Barr ick Gold (Holdings) Ltd in
Bulyanahulu, Tanzania. At SRK, Paul has been involved with due diligence audits of the Beoumi
Polymetallic deposit in Cote D'Ivoire and other Projects in Tar kwa along the Ashanti Belt margins.
He has acted as Competent/Qualified Person for a number of expl oration projects and technical
studies. Paul is a registered me mber with Australian Institute of Mining and Metallurgy (Reg:
305289). Paul holds a BSc in Geological Engineering and MSc Geo logical Engineering. Mr Paul
Blaber drafted the section of geology and exploration assessment and he performed site visit in 2022.
John Kwofie is an Associate Principal Geotechnical Engineer with SRK Consulting Ghana Limited.
He has a B.Sc. in Geological Engineering and an M.Sc. in Civil Engineering Construction Materials.
He has over 30 years’ experience in surface mining geotechnics predominantly in West African gold
mines. His work experience includes open pits slope design, geotechnical risk management in fresh
rock and saprolitic environments, tailings dams’ operational ma nagement, and earthworks quality
assurance. He has worked on multidisciplinary projects including gold mine construction, heap leach
pads, raise boring, tailings and freshwater dams, metallurgical plant foundations, buildings, and road
construction. He worked as an independent consultant and part-time lecturer prior to joining SRK as
Country Manager in May 2011. John has many years’ experience in  mining operations, notably as
Geotechnical Manager of AngloGold Ashanti - Mali (Sadiola, Yatela and Morila Mines) from 2008 to
2010. Prior to that, he was the General Manager - Rock Mechanic s for Hindustan Zinc Limited, a
member of Vedanta Resources Group in India. He is a registered member of the Southern African
Institute of Mining and Metallurgy (SAIMM) and also the South A frican National Institute of Rock
Engineering (SANIRE). Mr John Kwofie visited the project site in 2022 and he provided geotechnical
assessment to the project team.
Seth Owusu-Sarpong is a holder of MSc degree in Finance and MSc Degree in Mining Engineer
with specialization in Mining Rock Mechanics. He has over 30 years’ experience in underground hard
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rock mining and has been involved in many underground operation s of varying ground conditions
ranging from very shallow room and pillar mining, Cut and Fill mining to very deep and seismically
active Vertical Crater Retreat, Open Stope and Sub-Level Caving  environments. His experience
includes numerical modelling, ground control management, ground  conditions characterization for
large underground excavation designs (stopes, workshops, pump chambers, etc.,), mine shaft raise
boring, training of mine pers onnel in underground geotechnics, consultancy services, as well as
lecturing in Mining Principles and Rock Mechanics. His working experience covers 15 years of gold
mining with AngloGold Ashanti, Obuasi Mine, Ghana; 8 years of copper mining with Mopani Copper
Mines, (Mufulira, SOB Kitwe and Mindolo SV - underground and surface) in Zambia, and 8 years of
consultancy service and lecturing in Ghana. Mr Seth Owusu-Sarpong visited the Project in 2022 and
contributed in geotechnical assessment.
Ali Rudaki, BSc (Mine Exploitation Engineerin g), Pr Eng (South Africa), MSAIMM,  Principal
Mining Engineer of SRK Consulting (South Africa), he has been i nvolved in the field of open pit
mining engineering for the past 28 years. His expertise includes: open pit optimisation and strategic
mine planning and scheduling; strategic risk management in mine design, from life of mine to global
optimisation; mining and mineral processing optimisation; mining feasibility studies; and mining
operations. Mr Ali Rudaki visited the project site in 2023 and he has reviewed the mining aspects
and Ore Reserves for Open Pit since 2022.
TzuHsuan (Shan) Chuang, M.Eng., MAusIMM, is a Senior Consultant (Mining) at SRK China. She
has experience in consulting and operation management. After graduating from Colorado School of
Mines, she conducted scoping studies, pre-feasibility, feasibility studies, and project valuation in Zijin
mining design company, with projects in China, Serbia, Tajikistan, Australia, Colombia, and Guyana.
She then worked at Buritica underground gold mine of Continenta l Gold in Colombia, and was
responsible for life of mine (LoM ) plan, production operation, and grade control optimisation. Her
expertise includes pit optimisation, mine design, and scheduling in metal mine, and is skilled in using
Deswik, Whittle, Surpac, Minesched, and AutoCAD. Ms Shan Chuang assists Mr Xiao in mining and
Ore Reserve assessment and she is the Competen t Person who evaluates the Underground Ore
Reserves in this Project. She visited the Wassa Project in May 2024.
Lanliang Niu, BEng, MAusIMM, Member of MCAMRA, is a Principal Consultant (Processing) with
SRK Consulting China Ltd. He has 10 years’ experience in processing research and 10 years in plant
operation management and 15 years in mining technical consultan cy. He has specific expertise in
the processing of precious metal, nonferrous metal, ferrous metal, and some non-metallic minerals,
as well as processing test, plant design and operation management, and mining project evaluation.
He is actively involved with the new development of processing technologies, equipment, and
reagents and has received two national awards for his achievements in this area. Since joining SRK,
Lanliang has played a pivotal ro le in in the due  diligence and technical evaluation of nearly 200
mining financing or M&A projects within China and international ly. Mr Lanliang reviews the
processing part and he is the Competent Person of gold processing. He visited the Wassa Project in
May 2024.
Xiangfeng (Freda) Yang, M.E; MAusIMM, Registered Qualific ation Certificate of Constructor
(Mining Engineering and Mechanical & Electri cal Engineering), Registered Qualification
Certificate of Cost Engineer (Civil Engineering);  is a Senior Consultant (Processing) with SRK
China. Ms Yang acquired specialized knowledge of non-ferrous and non-metallic ore processing and
plant design during her undergraduate studies and graduate educ ation at Wuhan University of
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Technology. Since graduating in 2010, she has been engaged in feasibility study, preliminary design
and construction drawing design while employed with Bluestar Lehigh Engineering Institute Co., Ltd.
and Nanchang Mineral Systems Co., Ltd., published several paper s and models, and led and
participated in the design of many medium and large phosphate o re, potash and sulfide ore
processing plants. Ms Yang also has rich experience in processi ng equipment selection and
procurement, processing scheme design and plant configuration. Ms Freda Yang assists in mineral
processing assessment.
Lawrence Darkwah is a Senior Lecturer in Chemical Engineering at Kwame Nkrumah University of
Science and Technology, Kumasi and has vast experience working as an operation metallurgist and
a consultant. His expertise in Mineral Processing is in operati ons, technology development, and
implementation for the maximisation of resource recovery. He ha s been involved with diligent
auditing of processing assets cutting across the chemical engin eering discipline in Ghana. He has
also served as a panellist at a National Policy Summit in Kumas i where his knowledge and
experiences in the mineral processing industries were seen in advocating solutions to the small-scale
mining canker in Ghana. He has presented technical papers at various meetings and conferences
on mining practices and the potential menace from untreated mine water at national and international
fora.  Lawrence is registered with the Ghana Institution of Engineers (GhIE) (Reg: 08263) since 2015
and holds a BSc. (Hons.) in Metallurgical Engineering, an MSc. in Industrial Biotechnology and a
PhD. in Chemical Engineering respectively. Mr Lawrence Darkwah visi ted the Project in 2022 and
he provided additional support to the metallurgical review.
Hongchen (Cynthia) Huang, B.A., is a consultant (ESG) at SRK  China, possessing 10 years of
expertise in marketing, technica l translation and project manag ement within the mining industry.
Currently she is transitioning her focus towards environmental,  social, and governance aspects,
actively contributing to environmental and social assessments while playing a key role in supporting
SRK's carbon accounting program. Since joining SRK, Cynthia has  provided project co-ordination
and management, technical translations, and environmental revie w for a diverse range of projects,
including Guizhou Union Coal Project, Hanking Indonesian Nickel  Project, Mongolian Sujishan
Graphite Project, Australian Greenbushes Lithium Project, Chilean Salar Project, Angola Binga
Copper Project, and Zijin Group Tajik Gold Project. Ms Cynthia Huang assists in environmental and
social review. She visited the Wassa Project in May 2024.
Ekua Semuah Odoom, BSc (Environmental Science), Msc (Climate Change and Sustainable
Development), PhD (Environmental Science). Ekua Semuah Odoom is an environmental scientist
and the Director of Systems Environ-Tech Ltd, an environmental consulting firm based in Accra,
Ghana. She has over 7 years expe rtise in the areas of climate c hange adaptation and mitigation,
natural resource management, environmental assessment and auditing. Ekua has a broad
understanding of environmental legislation relevant to developm ent projects, including Ghana EIA
process, legislation and standards, and has over the years worked on environmental assessment for
the mining, oil and  gas, hospitality, healthcare and manufacturing sectors of Ghana . She has
undertaken tasks in the domain of Environment Impact Assessment  (EIA), Environmental
Management Plan (EMP), Annual Environmental Report (AER), and d ialogue facilitation among
project stakeholders. She also provides advisory services and m anages corporate environmental
compliance portfolio for companies and industries in Ghana. Eku a is currently in the process of
acquiring certification and mem bership with IEMA for practition er level in Environmental
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Management. Mr Ekua Semuah Odoom visited the Wassa Project in 2022 and he assisted in
environmental and social review.
Alexander (Alex) Thin, BEng, FAusIMM (CP), FIMMM, FSAIMMA,  Principal Consultant (Mining)
at SRK China, he is an experienced mining professional with over 30 years’ experience. His strategy
and leadership experience spans feasibility studies, mineral as set audits and evaluations,
independent technical reports, techno-economic studies, capital  raising, merger and acquisitions,
managing joint ventures, local and international stock exchange compliance, business development
and investor/ stakeholder relations. Alex’s industry experience spans operational (underground and
open pit), technical consulting and corporate within the metalliferous resources sector, covering
precious metals, base metals and bulk commodities. Mr. Alex Thin peer reviewed the Report and he
supervised the mining and Ore Reserve reviewing.
2.8 Warranties
Chifeng Gold has warranted to SRK that full disclosure has been  made of all material information
and that, to the best of their knowledge and understanding, suc h information is complete, accurate
and true. SRK has no reason to doubt these warranties.
2.9 Compliance Statement
The information in this report that relates to Mineral Resources/Ore Reserves is based on information
compiled by Mr. Pengfei Xiao, a Competent Person who is a Member of AusIMM, and Ms TzuHsuan
Chuang, a Competent Person who is a Member of the AusIMM. Both are full-time employees of SRK.
This Report is a Competent Person’s Report in line with the Listing Rules of the Exchange and HKEX.
Mr. Pengfei Xiao and Ms TzuHsuan Chuang have sufficient experie nce that is relevant to the style
of mineralisation and type of deposit under consideration and t o the activity being undertaken to
qualify as a Competent Person as defined in the JORC Code.
Mr. Pengfei Xiao and Ms TzuHsuan Chuang consent to the inclusio n in the report of the matters
based on their information in the form and context in which it appears.
Peer review and quality control of the Report were conducted by Mr Alex Thin, FAusIMM, a Principal
Consultant (Mining).
2.10 Independence Statement
Neither SRK nor any of the authors of this Report have any material present or contingent interest in
the outcome of this Report, nor do they have any pecuniary or other interest that could be reasonably
regarded as being capable of affecting their independence or that of SRK.
SRK’s fee for completing this Report is based on its normal pro fessional daily rates plus
reimbursement of incidental expenses. The payment of that professional fee is not contingent upon
the outcome of the Report.
– IIIC-45 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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SRK has no prior association with Chifeng Gold or Chifeng Gold’ s employees or in regard to the
mineral assets that are the subj ect of this Report. SRK has no beneficial interest in the outcome of
the technical assessment being capable of affecting its indepen dence. SRK is independent of
Chifeng Gold applying all of the tests in 18.21 and 18.22 of th e Listing Rules of the Exchange and
HKEX.
2.11 Consent
SRK consents to this Report being included, in full, in documen ts that Chifeng Gold proposes to
submit to the HKEX and/ or disclo sure to the public markets, in  the form and context in which the
technical assessment is provided, and not for any other purpose.
SRK provides this consent on the basis that the technical asses sments expressed in the Executive
Summary and in the individual sections of this Report are considered with, and not independently of,
the information set out in the complete Report and the Cover Letter.
2.12 Forward Looking Statement
Estimates of Mineral Resources, Ore Reserves, and mine production are inherently forward-looking
statements, which being projecti ons of future performance will necessarily differ from the actual
performance. The errors in such projections result from the inherent uncertainties in the interpretation
of geologic data, in variations in the execution of mining and processing plans, in the inability to meet
construction and production schedules due to many factors inclu ding weather, availability of
necessary equipment and supplies, fluctuating prices, ability of the workforce to maintain equipment,
and changes in regulations or the regulatory climate.
The possible sources of error in the forward-looking statements are addressed in more detail in the
appropriate sections of this report. Also provided in the report are comments on the areas of concern
inherent in the different areas of the mining and processing operations.
– IIIC-46 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Operational Licenses and Permits    Final
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3 Operational Licenses and Permits
The Wassa mine is located near the village of Akyempim in the Wassa East District, in the Western
Region of Ghana. It is located about 80 kilometers (km) north of Cape Coast and about 150 km west
of Accra, the capital city of Ghana. The property is situated between latitudes 5°25’ and 5°30’ north,
and between longitudes 1°42’ and 1°46’ east. The location of th e Wassa mine is shown in Figure
3-1.
Figure 3-1: Location of Wassa Mine

Source:SRK.
The Wassa mine is operated under the Wassa mining lease which w as issued on 17 September
1992. The total surface area of the Wassa Mining Lease is 63 km 2.In addition to the Wassa mining
lease, GSWL holds the Hwini Butre and Benso mining leases, and several prospecting licences in
the Western Region of Ghana. GSWL’s mineral properties are shown in Figure 3-2.
– IIIC-47 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 3-2: GSWL’s Mineral Properties Location in Ghana

Source: GSR.
The mineral concessions belonging to GSWL are listed below.
 Wassa mining lease: The Wassa Mine is an operating gold mine co mprising principally
underground operations with following mineralisation domains: F  Shoot, 419, B Shoot, 242,
Starter, South-East, Mid-East and Dead Man’s Hill.
 Benso mining lease: comprising the Subriso East, Subriso West, G-Zone, C-Zone and I-Zone
deposits.
– IIIC-48 –
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FOR THE WASSA GOLD MINE


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 Hwini Butre mining lease: comprising the Father Brown, Adoikrom and Dabokrom deposits.
 Benso (Chichiwelli) exploration property: comprising two minera lised zones, Chichiwelli West
and Chichiwelli East.
 Manso exploration property: located east of the Benso and Hwini Butre Concessions.
The properties and leases are spread along a trend of approximately 80 km southwest of the Wassa
mine. There are sufficient access and surface rights for GSWL’s operations. This section summarises
related operational licences and permits. SRK relied on the information provided by the Company,
and SRK understands that a legal due diligence review of this P roject has been undertaken by the
Company’s legal advisors.
3.1 Mineral Tenure
Table 3-1 sets out the mineral rights held by GSWL (or those in which GSWL has an interest). GSR
will from time to time seek a title opinion from its legal counsel in Ghana to confirm its title in its
material mineral properties, and the good standing of the underlying mineral rights. SRK viewed the
copies of the mining licenses and prospecting licenses of Wassa  project, while the licensing
information in relation to the project needs to be further reli ed on legal due diligence opinions. The
summary of the mineral tenure information is as below:
Table 3-1: Mineral Tenure Information
License
Type
Lease/Permit
Name Current Lease No.  Current
Grant Date
Current Expiry
Date
Current
Status
Area
(km2)
Mining
Lease
WASSA ML LVDGAST35364682022 26-Jan-2022 25-Jan-2047 Active 63.0 0
HWINI-BUTRE ML LVDGAST37993462020 25-Aug-
2020 24-Aug-2031 Active 43.00
BENSO ML LVDGAST38000372020 25-Aug-
2020 24-Aug-2031 Active 19.45
Prospecting
License
BENSO PL LVB 9113/1994 & PL
2/155
30-Dec-
2020
Pending
Renewal
Awaiting
Minister's
Approval
24.81
MANSO 1 PL LVB 5528/2005 & PL
2/378 3-Apr-2022 3-Mar-2025 Active 101.57
DWABEN
(SAFRIC) RL
LVB1624/2006 &
RL2/117
12-Mar-
2020
Pending
Renewal
Awaiting
Minister's
Approval
26.92
MANSO 2 PL LVB 8461/2003 & PL
2/337 5-Apr-2022 3-May-2025 Active 23.41
Source: GSR
Notes: The Benso PL and Dwaben RL are awaiting for the approval of Minister of Lands and Natural Resources
The Wassa Mine sits within the Wassa mining lease which comprises an area of 63.00 km2 lying to
the north and south of latitudes 5°25'30'' and 5°30'45'', respe ctively and bounded to the east and
west by longitudes 1°41'45'' and 1°46'30'', respectively.
The Wassa mining lease was entered between the Government of Gh ana and Satellite Goldfields
Limited (SGL) on 17 September 1992 for a term of 30 years, rene wable. In 2002, the mining lease
was assigned by SGL to GSWL with the written consent of the Government of Ghana. GSWL is the
– IIIC-49 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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registered legal and beneficial holder of the Wassa mining lease. The Government of Ghana holds
10% of GSWL share capital.
3.2 Underlying Agreements
GSWL pays to the Government of Ghana within thirty days from the end of each quarter a royalty at
a rate of 5% determined based on the total revenue of minerals produced during the quarter. This
royalty is payable prior to any adjustments from the Royal Gold  stream (see below). Royalties are
paid through the Commissioner of Internal Revenue.
Payment of annual ground rent is made to the owner of the land except in the case of annual ground
rent in respect of mineral rights over stool lands, which are paid to the Office of the Administrator of
Stool Lands. A holder of a mineral right must also pay to the Minerals Commission an annual mineral
right fee determined based on the type of tenure. GSWL pays ann ual ground rate and annual fees
in relation to all the mineral rights it holds.
GSR is party to a gold purchase and sale agreement with Royal Gold, Inc. through its wholly owned
subsidiary RGLD Gold AG (RGLD). The agreement was initiated on 6 May 2015, amended on 29
June 2018, 17 October 2019 and most recently 30 September 2020 before Chifeng Gold’s takeover.
The stream covers all gold produced within GSWL’s mineral conce ssions and requires GSR to
deliver according to two tiers:
 Tier 1: 10.5% of all production to RGLD at a cash purchase price of 20% of spot gold until 240,000
ounces have been delivered; and
 Tier 2: thereafter, to deliver 5.5% of all production to RGLD at a cash purchase price of 30% of
spot gold.
Pursuant to the terms of the gold sale and purchase agreement, GSR is restricted from granting
encumbrances on the Wassa gold pr oject without RGLD’s consent. In 2019, GSR entered into a
credit facility agreement with Macquarie Bank Limited pursuant to which GSWL’s mineral rights were,
with the approval of the Minister of Lands and Natural Resources and RGLD, encumbered to secure
the repayment of the loan.
SRK is not aware of legacy issues associated with the GSWL site.
3.3 Permits and Authorisation
In addition to the mineral rights specified in Table 3-1, GSWL requires certain permits and licenses
to carry out its activities, including:
 Mining operating permit:
The Minerals and Mining (Health, Safety and Technical) Regulati ons, 2012 (L.I. 2182) prescribe
technical and health and safety standards for mining operations and requires a person who is granted
a mining lease to, before the commencement of operation of the mine, obtain a mining operating
permit from the Inspectorate Division of the Minerals Commission.
– IIIC-50 –
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FOR THE WASSA GOLD MINE


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 Licence to export, sell or dispose of minerals:
The exportation, sale or disposal of minerals requires a licenc e from the Minister for Lands and
Natural Resources. Pursuant to section 46 of the Minerals and Mining Act., a mining lease authorises
the holder to, inter alia, “take and remove from the land the specified minerals and to dispose of them
in accordance with the holder’s approved marketing plan.” Under the Minerals and Mining (General)
Regulations, 2012 (L.I. 2173), an application by a holder of a mining lease for a licence to export,
sell or dispose of gold or other precious minerals produced by the holder must be accompanied by
a refining contract and a sales and marketing agreement.
 Operating licence and permit for the acquisition, use, transportation and storage of explosives:
Under Regulation 23 of the Minerals and Mining (Explosives) Reg ulations, 2012 (L.I. 2177), the
construction of a building or other structure to be used as a m agazine for the storage of explosives
is subject to an operating license delivered by the Minerals Co mmission. As required under
Regulation 32 of L.I. 2177, the st orage of explosives in a magazine is also subject to a permit from
the Minerals Commission; the latter is valid for one year and i s renewable upon application. Under
L.I. 2177, an operating licence is required for the purchase and use or transportation of explosives.
There are separate operating licences for the purchase and use of explosives and for transportation.
Each is valid for a period of one calendar year and is renewabl e on application made one month
before the end of each year. Additionally, a permit is required for each occasion on which explosives
are being transported in respect of which the specific type and  quantity of explosives must be
indicated.
 Licence to use water resources:
The use of water resources is regulated by the Water Resources Commission Act, 1996 (Act 522)
and the Water Use Regulations, 2001. Act 522 provides that no p erson shall (a) divert, dam, store,
abstract or use water resources; or (b) construct or maintain any works for the use of water resources
except in accordance with the provisions of the Act. Subject to  obtaining the requisite approvals or
licences, a holder of a mineral right may, for purposes of or ancillary to the mineral operations, obtain,
divert, impound, convey and use water from a river, stream, und erground reservoir or watercourse
within the land the subject of the mineral right.
 Fire permit:
The Fire Precaution (Premises) Regulations, 2003 requires that a fire certificate be issued by the
Chief Fire Officer in respect of premises used as a place of wo rk or for a purpose which involves
access to the premises by members of the public, whether on payment or not. The certificate is valid
for 12 months and is renewable.
GSWL conducts its operations in accordance with applicable laws  and regulations in Ghana and is
in compliance with its permitting obligations in relation to its activities. With regards to environmental
matters, GSWL has undertaken environmental impact assessment studies on its concessions to
support the permitting of its mining projects and has considera ble background data to support
required environmental permitting processes.
– IIIC-51 –
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FOR THE WASSA GOLD MINE


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3.4 Environmental Considerations
The Environmental Assessment Regulations, 1999 (L.I. 1652) requ ire that all developmental
activities likely to impact adversely on the environment be sub ject to environmental assessments.
Pursuant to these regulations, an undertaking which in the opin ion of the Environmental Protection
Agency (EPA) has or is likely to have an adverse effect on the environment cannot commence unless
the undertaking has been registered and an environmental permit has been issued by the EPA. The
Minerals and Mining Act requires that all necessary approvals a nd permits required to be obtained
from the Forestry Commission and the EPA for the protection of natural resources, public health and
the environment.
The major environmental permits in place for the Wassa mine are:
 Wassa operations (EPA/EIA/112) and expansions (EPA/EIA/322) including South Akyempim pits
(EPA/EIA/190);
 Hwini Butre and Benso operations (EPA/EIA/175) and expansion (EPA/EIA/247);
 Wassa tailings storage facility (“TSF”) 2 (EPA/EIA/383) and renewal (EPA/EIA/442); and
 Wassa Expansion project, including Wassa underground, Main pits and waste dump expansion
(EPA/EIA/508).
3.5 Mining Rights in Western Region of Ghana
There are a number of mining licenses granted for companies operating in Ghana.
The Constitution of Ghana vests title in every mineral in its natural state to the Government of Ghana.
The exercise of any mineral right in Ghana requires an appropriate mineral title to be issued by the
Government of Ghana acting through the Minister responsible for Lands and Natural Resources. The
Minister of Lands and Natural Resources administers, promotes a nd regulates Ghana’s mineral
wealth through the Minerals Commission, a governmental organization designed in accordance with
the Minerals Commission Act 1993 and the Minerals and Mining Ac t, 2006 Act 703 (Minerals and
Mining Act).
A person must apply to the Minerals Commission and be granted a  mineral right by the Minister of
Lands and Natural Resources before they can search, survey, prospect, explore or mine for a mineral
anywhere in Ghana. There are different types of licenses (namely, reconnaissance and prospecting
licenses, and mining leases) for the different mining activitie s. Each type of licence details the
activities that are permitted.
The Government of Ghana holds a 10% free-carried interest in all companies holding mining leases.
The 10% free-carried interest entitles the Government to a pro- rata share of future dividends. The
Government has no obligation to contribute development capital or operating expenses.
– IIIC-52 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Accessibility, Climate, Local Resources, Infrastructure, and Physiography  Final
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4 Accessibility, Climate, Local Resources,
Infrastructure, and Physiography
4.1 Accessibility
The Wassa Mine is located near the village of Akyempim in the Wassa East District in the Western
Region of Ghana. It is 62 km north of the district capital, Dab oase, and 40 km east of Bogoso. It is
located 80 km north of Cape Coast and 150 km west of the capita l Accra. The main access to the
site is from the east, via the Cape Coast to Twifo-Praso road, then over the combined road-rail bridge
on the Pra River. There is also an access road from Takoradi in the south via Mpohor.
4.2 Local Resources and Infrastructure
There are four other mines in the vicinity of Tarkwa; namely, G hana Manganese Company – Nsuta
Mine, Anglo Gold Ashanti Iduapriem Gold Mine and Goldfields Ghana Limited - Damang and Tarkwa
mines.
The Wassa Mine itself is located in the Wassa Mining Lease within the Subri-Akyempim Concession,
which covers an area of 63 km2.
Wassa Mine is currently an operating open pit and underground mining complex yielding
approximately 480kt of total mat erial (ore and waste) per month , and the required services,
infrastructure, and community support are already in place. The  following are relevant to the
assessment of resources and infrastructure:
 Access to the project is via the public road network that extends on to the site;
 Electricity and water are available;
 Surface infrastructure in the area consists of a variety of government, municipal, and other roads
with good overall access;
 Processing will be carried out at the existing GSWL processing plant;
 Tailings will be stored in the existing GSWL TSF and the new TSF approved in April 2013;
 Waste rock generated at the site will be placed in existing waste dumps, adjacent to the Wassa
open pit; and
 The extensive history of mining in Ghana provides opportunities  to obtain skilled underground
mine workers.
4.3 Climate
The climate in the project area is classified as wet semi-equatorial. The Inter Tropical Convergence
Zone (“ITCZ”) crosses the area tw ice a year, resulting in a bi- modal rainfall pattern, with peaks in
March to July and September to October. During the dry season m onths of November to February,
the climate is heavily influenced by the dry, dust-laden, north west trade wind, known locally as the
Harmattan, which blows from the Sahara Desert.
– IIIC-53 –
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FOR THE WASSA GOLD MINE


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Analysis of available rainfall data, obtained from the Ateiku M eteorological survey (1944 to 2009)
indicates that the average annual rainfall is 1,996 ± 293 millimetres (“mm”). The wettest month of the
year is generally June, with an average rainfall of about 241 ±  85 mm, whilst January is the driest
month of the year with an average rainfall of about 31 ± 35 mm.  The wettest month on record was
June 2009, when 475 mm of precipitation was recorded. Rainfall is mainly influenced by south-west
monsoon winds, which blow from the south-western part of the country towards the north-east.
Using data from the GSWL weather station, the average annual rainfall has been estimated at about
1,750 mm. A drier period, which is influenced predominantly by a sweep of the north-east trade
winds, is experienced between the month of November and February.
Annual potential evapotranspiration is estimated to be approxim ately 1,337 millimetres per year
(“mm/yr”), indicating a minimum precipitation excess of 288 mm/ yr. Rainfall exceeds potential
evapotranspiration from March to July and September to October, and groundwater recharge is most
likely to be prevalent during t hese periods. Relative humidity is fairly constant throughout the year,
ranging from 88% to 90%.
Under such climatic conditions surface mining operations can continue year-round with short breaks
during storms, most of which are short-term and may be experien ced throughout most of the year.
Underground mining operations w ill not be directly affected by storms as long as effective storm
water management infrastructure is in place at surface to divert runoff from mine’s accesses.
4.4 Physiography
The project area is characterised by gently rolling hills with elevations up to 1,100 m RL, incised by
an extensive drainage network. The natural vegetation is an eco tone of the moist, semi-deciduous
forest and wet rainforest zones. It has been degraded due to anthropogenic activities, giving way to
broken forest, thickets of secon dary forest, forb re-growth, sw amps in the bottom of valleys, and
cleared areas.
Extensive subsistence farming occurs throughout the area, with plantain, cassava, pineapple, maize,
and cocoyam being the principal cr ops. Some small-scale cultiva tion of commercial crops is also
carried out, with cocoa, teak, coconut and oil palm the most common. Forest patches are present on
the steep slopes and in areas unsuitable for agriculture.
Environmental assessments carried out in the project area over the last two decades (SGS 1996 and
1998, WGL 2004, GSR 2015, Geosystems 2013, and Golder 2016) ind icate that the biodiversity of
the Wassa operational area is of low ecological significance and conservation status.
– IIIC-54 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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History    Final
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5 History
5.1 Wassa
5.1.1 Historical Mining
The Wassa area has experienced local small-scale and colonial m ining activity since the beginning
of the 20th century with numerous small open pits and adits evident.
From 1988, the property was operated as a small-scale mining operation with a gravity gold recovery
circuit by WMRL, a Ghanaian company.
5.1.2 Satellite Goldfields Limited (1993-2002)
In 1993 WMRL formed SGL with the Irish companies Glencar Explor ation Ltd. and Moydow Ltd.,
assigning the Wassa mining lease to SGL.
Extensive satellite imagery and geophysical interpretations were carried out which identified a strong
gold target. Exploration drilling commenced in February 1994 and by March 1997, 58,709 m of drilling
had been completed. Construction of the Wassa Mine was initiated in September 1998, after Glencar
secured a US$42.5 M debt-financing package from a consortium of banks and institutions.
The operation was originally developed as an open pit mine with  heap leach treatment of 3.0 Mtpa
and planned production of 100,000 oz/yr. First ore was mined from the open pit in October 1998.
During the first year of production, planned gold recovery of 8 5% from oxide ore in the heap leach
was not achieved due to high clay content of the ore and poor solution management. Attempts were
made to increase recovery, including doubling the leach solution application rate but recoveries for
the oxide ores above 55-60% could not be achieved.
The low gold recovery resulted in debt servicing issues and Was sa was marketed for sale. GSR
started negotiations to purchase Wassa in mid-2000. As part of due diligence, GSR initiated a drilling
program in March 2001 to test their geological model and extens ions to some of the high-grade
orebodies.
SGL was placed into receivership in November 2001 and in April 2002, GSR concluded that the
mineable reserve at Wassa was 30% below the 648,000 oz stated b y SGL. Negotiation continued
until September 2002 when the agreement for GSR to purchase the  90% share of Wassa was
announced.
5.2 Hwini Butre, Benso and Chichiwelli
5.2.1 Historical Mining
Early European reports indicate the Dabokrom area, around Hwini  Butre, may have been a major
source for gold sold to Portuguese explorers when they first arrived in Ghana in the late 1400’s.
– IIIC-55 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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History    Final
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European interest grew in the 1800’s with the presence of gold and proximity to Sekondi-Takoradi,
which had developed as a port to service mines at Tarkwa, Prest ea and Obuasi. Many exploration
licences were granted during the gold boom of 1898-1902 and by the 1930’s most of the area was
under license to various local and European interests.
At Dabokrom, a shaft was sunk by Oceania Consolidated in the 1930’s to follow the shallow dipping
quartz veins. The property was worked for several years but sto pped in 1939 at the start of World
War 2.
At Chichiwelli, a shaft was sunk in 1918 following a quartz vei n at the very north end of the Benso
concession, close to the Subri River Forest Reserve. Mining pro gressed to the 260 ft level but was
abandoned in 1924 after the mine was flooded.
The whole area has many historic workings which evidence mining activity, mostly from the 1930’s.
5.2.2 Modern Explo ration (1980’s-2005)
The Dabokrom concession was acquired by BD Goldfields (BDG) dur ing the 1980’s who invited
Danish company Lutz Resources Li mited to carry out preliminary exploration on the property. The
property transferred to Hwini Butre Minerals (HBM) in the early 1990’s, which was controlled by Lutz.
HBM entered a joint venture with Placer-Outukumpu who drilled several holes around Dabokrom in
1993 to assess potential of the vein systems. They concluded th at potential was limited by widely
spaced veins and little gold in the diorite host rock. Saint Jude Resources (SJR) acquired Dabokrom
in 1994 and explored the area until 2002 when work was suspended due to a legal dispute between
SJR, BDG and the Government of Ghana. The matter was resolved in 2005 before acquisition of the
project by GSR.
SJR began exploring the concession in February 1995 which represented the first sustained
exploration program on the concession. SJR undertook ground geophysical surveys which included
magnetic, radiometric and induced polarization surveys; soil geochemical surveys were also
completed on the concession area, resulting in the identification of numerous targets. Trenching and
pitting were conducted in areas of geophysical and geochemical anomalies and over historical
prospects or old workings in an attempt to outline near surface mineralisation. Subsequent drilling of
the surface targets resulted in the delineation of the Adoikrom , Father Brown and Dabokrom
prospects along a combined strike length of 900 m. Further exploration conducted in 2005 identified
the Adoikrom North prospect. A total of some 22,100 m over 267 drill holes were completed on the
main mineralised zones and the exploration targets.
Reconnaissance work at Chichiwe lli, Subriso, Denerawah and Amantin was conducted by BHP
Billiton from 1989-92, on what is now the Benso concession. Thi s identified soil geochemical
anomalies and follow-up drilling was completed at Chichiwelli b ut results did not meet targeting
criteria and the concessions were relinquished. Tenure was then  acquired by a local company,
Architect Co-Partners, with a 150 km2 prospecting concession which covered Amantin, Subriso and
Chichiwelli, as well as a large part of the Subriso River Forest Reserve that was closed to exploration
from 1996.
Canadian company Fairstar Exploration Ltd. (“Fairstar“) took over the Benso concession in 1995 and
carried out extensive work, particularly at Subriso and Amantin , where considerable drilling was
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completed, but ceased by the end of the decade due to funding c onstraints. An agreement was
reached in 2001 for SJR to take over the exploration work.
In 2001, SJR completed an agreement with Fairstar and took over the exploration work. From early
2002 to about mid-2004, SJR focused mainly on the Subriso area where substantial mineralisation
was outlined at two prospects, Subriso East and West. Numerous other prospects, namely Subriso
Central, I Zone and G Zone were identified, and drill tested, as was the Amantin area, which had
also been drilled to a considerable extent by Fairstar.
5.3 Production History, Previously Declared Resources and Reser ves
Since acquiring Wassa in 2003 GSR has produced 2.4 million ounc es of gold and the mine has a
remaining life of five years (2024 to 2028) as defined by the current Ore Reserve.
Milestones at Wassa under GSR management are:
 2003: definition drilling ahead of feasibility study for a carbon-in-leach (CIL) plant.
 2004: feasibility study completed, and construction commences on CIL plant with open pit mining.
 2005: CIL plant commissioned.
 2006: acquired St Jude Resources ( Hwini Butre and Benso concess ions). Connected to grid
power.
 2007: commenced open pit mining at South Akyempim. Construction of haul road to Hwini Butre.
 2008: commenced open pit mining at Benso, processing at Wassa.
 2009: commenced open pit mining at Hwini Butre and drilling to test underground potential.
 2011: Hwini Butre mining moves from Adoikrom to Father Brown open pit.
 2012: commenced drilling to test underground potential below Wassa.
 2013: upgraded plant to 2.7 Mtpa capacity with fresh ore, conso lidated mining at Wassa Main
open pit.
 2014: released positive Preliminary Economic Assessment for Was sa Underground and
completed Hwini Butre mining at Father Brown.
 2015: completed positive Feasibility Study for Wassa UG and com menced development, along
with starting construction of TSF 2.
 2016: mined first stope ore from Wassa UG in July and definition drilling continued to define wide
zones of mineralisation in B Shoot.
 2017: commercial production declared at Wassa UG and deep definition drilling program defines
what was later to become the Southern Extension zone. UG averages 1,865 ore t/d.
 2018: open pit mining of Main pit completed and UG ore mining r ate increases to 2,945 t/d.
Wassa UG Inferred Mineral Resour ce reported growth to 5.2 Moz with addition of Southern
Extension zone.
 2019: completed positive Feasibility Study for paste backfill c ommenced development. UG ore
mining rate increased to 3,895 t/d (1.4 Mtpa).
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 2020: completed construction of paste backfill plant and on-site gas-fired power generation. UG
ore mining rate increased to 4,480 t/d (1.6 Mtpa).
 2023: commenced construction of B Shoot South and 242 decline
Production peaked in 2013 at 187 koz gold with the plant operat ing at full capacity and high-grade
ore being mined from the Father Brown open pit at Hwini Butre. From 2014, open pit ore was sourced
solely from the Wassa Main pit until its completion in 2017. Lower grades resulted in gold production
of around 100 koz/yr.
Mining transitioned to underground from 2016, with commercial production realized in 2017 and the
underground becoming the main production source by 2018. Since 2018, underground production
has steadily increased to maintain and exceed 150 koz/yr, with the addition of minor amounts of low-
grade ore from open pit stockpiles.
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6 Geological Setting and Mineralisation
6.1 Regional Geology
The regional geological setting of the Ashanti belt has been extensively described by several authors.
The Ashanti greenstone belt in the Western Region of Ghana is c omposed primarily of
paleoproterozoic metavolcanic and metasedimentary rocks that ar e divided into the Birimian
Supergroup (Sefwi and Kumasi Groups) and the Tarkwa Group. Both units are intruded by abundant
granitoids (Figure 6-1) and host numerous hydrothermal gold deposits such as the Wassa, Obuasi,
Bogoso and Prestea mines and paleoplacer deposits such as the T arkwa and Teberebie Mines,
Perrouty et al, (2012).
Allibone et al. (2002) separated the Paleoproterozoic Eburnean orogeny into two distinct phases
known as Eburnean I and II, this classification was revised by Perrouty et al. in 2012 and proposed
two distinct orogenic events, the Eoeburnean orogeny and the Eburnean orogeny. The Eoeburnean
orogeny predates the deposition of Tarkwaian sediments and is a ssociated with a major period of
magmatism and metamorphism in the Sefwi Group basement. The Ebu rnean event is associated
with significant post-Tarkwaian deformation that affected both the Birimian Supergroup and overlying
Tarkwaian sediments. The Eburnean orogeny is associated with major northwest to southeast
shortening that developed major thrust faults, including the Ashanti Fault along with isoclinal folds in
Birimian metasediments and regional scale open folds in the Tar kwaian sediments. These features
are overprinted by phases of sinistral and dextral deformationa l events that reactivated the existing
thrust faults and resulted in shear zones with strong shear fabrics.
The Birimian series was first described by Kitson (1918) based on outcrops located in the Birim River
(around 80 km east of the Ashanti Belt). Since this early inter pretation, the Birimian stratigraphic
column has been revised significantly. Before the application o f geochronology, the Birimian super
group was divided in an Upper Birimian group composed mainly of  metavolcanics and a Lower
Birimian group corresponding to metasedimentary basins. Subsequ ent authors have proposed
synchronous deposition of Birimian metavolcanics. Most recently, Sm/Nd and U/Pb analyses have
reversed the earlier stratigraphic interpretation with the youn ger metasediments overlying the older
metavolcanics. Proposed ages for the metavolcanics vary between 2,162 ± 6 Ma and 2,266 ± 2 Ma.
Detrital zircons in the metasediments indicate the initiation o f their deposition between 2,142 ± 24
Ma 2,154 ± 2 Ma. The Kumasi Group was intruded by the late sedi mentary Suhuma granodiorite at
2,136 ± 19 Ma (U/Pb on zircon, Adadey et al., 2009).
The Tarkwa super group was first recognised by Kitson (1928) and consists of a succession of clastic
sedimentary units, which have been divided in four groups by Whitelaw (1929) and Junner (1940).
The Kawere Group located at the base of the Tarkwaian super group is composed of conglomerates
and sandstones with a thickness varying between 250 m and 700 m . The unit is stratigraphically
overlain by the Banket Formation, which is characterized by seq uences of conglomerates
interbedded with cross-bedded sandstone layers, the maximum thickness of this group being 400 m.
The conglomerates are principally composed of Birimian quartz pebbles (>90%) and volcanic clasts
(Hirdes and Nunoo, 1994) that host the Tarkwa Placer deposits. The Banket formation is overlain by
approximately 400 m of Tarkwa Phyllites.
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The uppermost unit of the Tarkwa super group is the Huni Sandstone, comprised of alternating beds
of quartzite and phyllite intruded by minor dolerite sills that form a package up to 1,300 m thick (Pigois
et al., 2003). U/Pb and Pb/Pb geoc hronology dating of detrital zircons provide a maximum
depositional age of 2,132 ± 2.8 Ma for the Kawere formation and  2,133 ± 3.4 Ma for the Banket
formation (Davis et al., 1994; Hirdes and Nunoo, 1994). These a ges agree with the study by Pigois
et al. (2003) that yielded maximum depositional age of 2,133 ± 4 Ma from 71 concordant zircons of
the Banket formation. Accordi ng to all concordant zircon histog rams (161 grains) and their
uncertainties, a reasonable estimation for the start of the Tarkwaian sedimentation could be as young
as 2,107 Ma.
Abundant granites and granitoids intruded the Birimian and Tark waian units during the
Paleoproterozoic. Eburnean plutonism in southwest Ghana can be divided into two phases between
2,180 to 2,150 Ma (Eoeburnean) and 2,130 to 2,070 Ma (Eburnean) that is supported by the current
database of U/Pb and Pb/Pb zircon ages. Most of the granitoids which intruded during both phases
correspond to typical Tonalite–Trondhjemite–Granodiorite (“TTG”) suites. However, in the southern
part of the Ashanti Belt, intrusions within the Mpohor complex have granodioritic, dioritic and gabbroic
compositions.
Dolerite dykes oriented north-s outh and East northeast to West southwest that are generally less
than 100 m in thickness are abundant across the West African craton where they cross-cut Archean
and Paleoproterozoic basement. In southwestern Ghana these dyke s are well defined in magnetic
data where they are characterised by strong magnetic susceptibility. Dolerite dykes are observed to
cross-cut undeformed K-feldspar rich granites that formed during the late Eburnean, and are overlain
by Volta basin sediments with a maximum depositional age of 950 Ma (Kalsbeek et al., 2008). These
relationships constrain dyke emplacement to between 2,000 Ma and 950 Ma. In contrast some older
dolerite/gabbro dykes and sills were deformed during the Eburnean orogeny and are dated at 2,102
± 13 Ma (U/Pb on zircon, Adadey et al., 2009).
With the exception of some late Eburnean granitoids, dolerite dykes and Phanerozoic sediments, all
other lithologies have undergone metamorphism that generally do es not exceed upper greenschist
facies. Studies on amphibole/plagioclase assemblages suggest the peak temperature and pressure
was 500 to 650 ◦C and 5 to 6 kbar (John et al., 1999), dated at 2092 ± 3 Ma (Oberthür et al., 1998).
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Figure 6-1: Location of the Wassa Mine with the Geology of the Ashanti Belt
Source: Perrouty et al,, 2012.
6.2 Property Geology
The Wassa Mine property lies within the southern portion of the  Ashanti Greenstone Belt along the
eastern margin of the belt within a volcano-sedimentary assembl age located at proximity to the
Tarkwaian basin contact. The eastern contact between the Tarkwaian basin and the volcano-
sedimentary rocks of the Sefwi group is faulted, but the fault is discrete as opposed to the western
contact of the Ashanti belt where the Ashanti fault zone can be  several hundred meters wide.
Deposition of the Tarkwaian sediments was followed by a period of dilation and the intrusion of late
mafic dykes and sills.
The lithologies of the Wassa assemblage are predominantly comprised of mafic to intermediate
volcanic flows which are interbedded with minor horizons of vol caniclastics, clastic sediments such
as wackes and magnetite rich sedimentary layers, most likely banded iron formations. The volcano-
sedimentary sequence is intruded by syn-volcanic mafic intrusives and felsic porphyries.
The magnetic signature of the Ashanti belt is relatively high in comparison to the surrounding Birimian
sedimentary basins such as the Kumasi basin to the west of the Ashanti belt and the Akyem Basin
to the East as illustrated in Figure 6-2.
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Figure 6-2: Total Magnetic Intensity Reduced to Pole of the Ashanti Belt
Source: Modified form Perrouty et al., 2012.
Rock assemblages from the southern area of the Ashanti belt wer e formed between a period
spanning from 2,080 to 2,240 Ma as illustrated in Figure 6-3 wi th the Sefwi Group being the oldest
rock package and the Tarkwa sediments being the youngest. The A shanti belt is host to numerous
gold occurrences, which are believed to be related to various s tages of the Eoeburnean and
Eburnean deformational event. Structural evidence and relationships observed in drill core and pits
at Wassa would suggest the mineralisation to be of Eoeburnean t iming while other known deposits
in the southern portion of the Ashanti belt such as Chichiwelli, Benso and Hwini Butre are considered
to be of Eburnean age.
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Figure 6-3: Compilation of Geochronology Dating from the Ashanti Belt
Source: Perrouty et al., 2012.
The Eoeburnean deformation is best observed at Wassa where the deformational event has
produced a penetrative foliation with an associated lineation which is defined by mineral alignments.
A period of extension occurred between the Eoeburnean and Eburnean deformational events which
resulted in the formation of the Akyem Basin (Kumasi Group) to the northeast of the Wassa Mine
and the Tarkwa group to the west  of the Wassa concession. Both metasedimentary sequences of
the Takwa and Kumasi group have not been affected by the penetrative foliation observed at Wassa.
The Eburnean deformation is divi ded in multiple events which va ry in number depending on the
authors as summarized in Table 6-1. All deposits underlying the  Wassa concession have been
affected by the Eburnean deformational events, the main penetra tive foliation has been affected by
at least three Eburnean folding events which have resulted in a  large scale refolded synform. The
main foliation is sub-vertical  and oriented northeast to southw est on the south-eastern flank of the
Wassa mine fold whereas it is dipping at around 45° to the sout h-southeast on the northwest flank
of the Wassa mine fold.

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Table 6-1: Compilation of Deformational History of the Ashanti Belt
Regional Interpretation
(This Study)
In Birimian
Obusai/Bogoso
(Allibone et al.,
2002a, b)
In Tarkwaian
Damang
(Tunks et al.,
2004)
Regional
(Eisenlhor et al.,
1992)
Regional
(Feybesse et
al., 2006)
(Milesi et al.,
1992)
Eburnean
1
>2150
Ma
Early Birimian volcanism and sedimenation
Volcanism
Granitoids
intrusion
Regional
metamorphism

Birimian sediments
and volcanics
penecontempora-
neous
Plutonism (Dixcove
type granitoids)
Magmatic
accretion
Plutonism
Birimian
sedimentation
D1, N-S shortening
Regional scale folding in the Early Birimian
unit
Syn-tectonic plutonism before 2170 Ma
Possible gold mineralisation Onset of deformation
in a "foreland thrust"
and Tarkwaian
deposition D2, Extension Phase
Late Birimian sedimentation
S2 parallel to bedding (S0) in Birimian sediments
Tarkwaian basin formation
D1, S1 parallel
to bedding
Flat-lying
bedding
parallel
shearing
Eburnean
2
2120-
2060 Ma
D3, NW-SE shortening
Km scale folds in Birimian and Tarkwaian
S3 subvertical crenulation cleavage NE-
SE
Thrust faults (Ashanti, Damang, …)
Peak of metamorphism (Low Amphibolite)
D2, NW-SE
shortening
Isoclinal folds
with axial
surface parallel
to the regional
faults and
shear zones
Ashanti thrust
fault
D1, NW-SE
shortening
Km scale folds
(with
subvertical
axial surface
(S1))
Damang thrust
fault
D1, NW-SE
shortening
S1 (NE-SE)
subvertical and
subparallel to bedding
in both Birimian and
Tarkwaian
Regional folds (light to
isoclinal)
D1, NW-SE
shortening
Thrust faults
Tarkwaian
sediments
deposition
(Syn D1)
Metamorphism
(6 kbar/550-
650℃)
D3
Low dip axial
surface fold at
Obuasi
S3 crenulation
cleavage
overprinting S2
Final stage of
D2?

D2, Continuing
Compression
S2 (NE-SE) fabrics
overprint S1 foliation
S2 is defined by
aligned muscovite and
elongate recrystallised
quartz veins
Metamorphism
Syn-tectonic
plutonism
(Cape-Coast type
granitoids)
D2/D3, NW-
SE shortening
Tarkwaian
folds
Strike-slip
faults and
shearing
Gold
mineralisations
Metamorphism
(2-3 kbar/200-
300℃)
D4, NNW-SSE shortening
Sinistral shear reactivation of D3 thrust
S4 crenulation cleavage ENE-WSW
Greenschist retrograde metamorphism
Remobilization and concentration of gold
particle along the shear zones and at the
base of Tarkwaian
D4, NNW-SSE
shortening
Hm scale fold
at Obuasi D2, NNW-SSE
shortening
Thrust faults
and minor
folds
D5 or syn-D4
Sinistral strike-
slip faults and
shearing
Gold
mineralisation
D5
Recumbent folds (<m)
Subhorizontal crenulation cleavage
Last pyrite/gold mineralisation associated
with quartz vein
D3, ESE-
WNW
shortening
Folds with
shallowly
dipping axial
surfaces and
mineralised
quartz veins,
post-dating
the peak of
metamorphism
K-rich plutonism
(cross-cutting all
previous structures)
Late plutonism
D6, NE-SW shortening, Panafrican (600 Ma)??
Low amplitude folds + crenulation cleavage ≈ N320 / 70
(RH)
Reverse faults oriented NW-SE
D4 Faults
oriented NW-
SE
Source: Perrouty et al., 2012.
The Wassa lithological sequence is characterized by lithologies  belonging to the Sefwi Group and
consisting of intercalated meta-mafic volcanic and meta-diorite  dykes with altered meta-mafic
volcanic and meta-sediments which are locally characterized as magnetite rich, Banded Iron
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Formation (“BIF”) like horizons (Bourassa, 2003), as illustrate d in Figure 6-4. The sequence is
characterized by the presence of multiple ankerite-quartz veins  which are sub-parallel to the main
penetrative foliation. The lithological sequence is also characterized by Eoeburnean felsic porphyry
intrusions on the south-western flank of the Wassa mine fold.
Figure 6-4: Lithology of the Deposit Area
The first deformational event (D1) at Wassa is of Eoeburnean ti ming and consists of North-South
shortening. This pre-Tarkwaian event resulted in a penetrative foliation which transposed lithological
contacts along this main foliation. Early, gold bearing, synD1 quartz-ankerite veins were also formed
during the Eoeburnean event.
The second event of deformation (D2) is an extension period wit h no local deformation at the mine
scale at Wassa. Regionally, this event separates the Eoeburnean  and Eburnean orogeny by an
extension period of approximately 40 Ma which resulted in the s edimentation of the Birimian and
Tarkwaian basins.
The Eburnean orogeny is divided in three distinct deformational events, D3 is a Northwest-Southeast
shortening event which resulted in the inversion of regional de tachment faults into thrust faults. At
the mine scale, this event generated a second penetrative folia tion at Wassa and a first phase of
Eburnean folding. The D4 deformational event, a North Northwest-South Southeast shortening event
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resulted in the sinistral reactivation of earlier faults at the  regional scale and severely buckled the
Wassa stratigraphic sequence into moderately steeply dipping, t ight fold patterns (F4 Fold) and a
third penetrative foliation (S4).The last deformational event, D5, is the result of sub-vertical
compression which resulted in open recumbent folds at Wassa and a fourth foliation located in the
axial plane of the F5 folds and is generally sub-horizontal, shallowly plunging to the South.
Folded nature of the lithological sequence due to deformation is presented in vertical sections of the
Wassa Main deposit (Figure 6-5).
Figure 6-5: Vertical Section 19975N of the Wassa Main Deposit Showing Folded Nature of the
Lithological Sequence during the Eburnean D3 and D4 Deformational Events

The Wassa mineralisation is subdivided into a number of domains ; namely F Shoot, B Shoot, 242,
South-East, Starter, 419, Mid-East, and Dead Man's Hill. Each o f these domains, except for Dead
Man's Hill, represents discontinuous segments of the main miner alised system which extends for
approximately 3.5 km along strike and is still open at depth. Dead Man's Hill sits to the north-east of
the main trend, proximal to the projected F4 axial fold trace. The SAK deposits are located
approximately 2 km to the southwest of the Wassa Main deposit on the northern end of a well-defined
mineralised trend parallel to the Wassa Main trend. The mineral isation is hosted in highly altered
multi-phased greenstone-hosted qua rtz-carbonate veins interlace d with sedimentary pelitic units.
The SAK mineralisation is subdivided into a number of domains as well, SAK 1, 2 and 3.
Mineralisation within the Wassa Mine is structurally controlled  and related to vein densities and
sulphide contents. In detail, the mineralisation generally consists of broadly tabular zones containing
dismembered and folded ribbon-like bodies of narrow quartz vein material, zones are typically 10 m
to 50 m wide within a 900 m mineralised corridor as illustrated in Figure 6-6. Three vein generations
have been distinguished on the basis of structural evidence, ve in mineralogy, textures and
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associated gold grades. Evidence further relates the majority o f gold mineralisation to the earliest
recognised vein generation which is believed to be syn-Eoeburnean. Gold grades broadly correlate
with the presence of quartz-dolomite/ankerite-tourmaline bearin g quartz veins and the presence of
sulphide minerals (predominantly pyrite) within and around the quartz veins. Gold grades appear to
be spatially restricted to the quartz veins, vein selvages and the immediate wall rocks. The alteration
haloes developed around the veins and pervasively developed wit hin the core of the Wassa Fold
contain lower grade mineralisation. The combined and overprinted Eburnean deformational events
(D3 to D5) render precise prediction of the vein geometries and  localities difficult in areas remote
from drillhole data. While the general peripheries of the mineralised zones can be defined reasonably
well with the drillhole data, the internal geometry is difficult to resolve with confidence.
Figure 6-6: Vertical Section 20000N of the Wassa Main Deposit S howing the Tabular Nature
of Ore Zones
6.3 Deposit Types
6.3.1 Wassa
The Wassa deposit is located on the eastern flank of the northe ast trending Ashanti Belt, a
Paleoproterozoic greenstone belt which was formed and deformed, along with the dividing Birimian
and Tarkwaian sedimentary basins during the Eoeburnean and Eburnean orogeny. Most deposits
found within the Ashanti belt can be classified as lode gold de posits or orogenic mesothermal gold
deposits, with the exception of the Tarkwaian paleoplacer deposits which have a sedimentary origin.
Orogenic gold deposits are the most common gold systems found w ithin Archean and
Paleoproterozoic terrains, in the West African shield, these de posits are typically underlain by
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geology considered to be of Eburnean age and are generally host ed by volcano-sedimentary
sequences.
B. Dubé and P. Gosselin of the Geological Survey of Canada desc ribed these deposits as
greenstone-hosted quartz-carbonate vein deposits in the 2007 sp ecial publication No. 5 entitled
Mineral Deposits of Canada. The authors described these deposits as typically occurring in deformed
greenstone belts and distributed along major compressional crus tal scale fault zones commonly
marking the convergent margins between major lithological bound aries. The greenstone-hosted
quartz-carbonate vein deposits correspond to structurally controlled complex deposits characterized
by networks of gold-bearing, lam inated quartz-carbonate fault-fill veins. These veins are hosted by
moderately to steeply dipping, compressional brittle-ductile shear zones and faults with locally
associated shallow-dipping extensional veins and hydrothermal breccias. In these deposits, gold is
mainly confined to the quartz-carbonate veins but can also occu r within iron-rich sulphidized wall
rocks or within silicified and sulphide-rich replacement zones.
The Ashanti belt is considered prospective for orogenic mesothe rmal gold deposits and hosts
numerous lode gold deposits and paleoplacer deposits. Several major gold deposits are found within
the Ashanti belt which can be classified into six different deposit types:
 Sedimentary hosted shear zones;
 Fault fill quartz veins;
 Paleoplacer;
 Intrusive hosted;
 Late thrust fault quartz veins; and
 Folded veins system.
The sedimentary hosted shear zone deposits are localized princi pally along a steep to sub-vertical
major crustal structures located along the western margin of th e Ashanti belt referred to as the
Ashanti trend. The Ashanti trend shows a range of mineralisatio n styles associated with graphitic
shear zones, which represents the principal displacement zone of a regional-scale shear zone that
defines the mineral belt. These styles include highly deformed graphitic shear zones containing
disseminations of arsenopyrite as the principal gold bearing phase and disseminations of sulphides
in mafic volcanic rocks general ly found in the footwall of the main shear zones. The sedimentary
hosted shear zone deposits which occur along the Ashanti trend include Bogoso, Obuasi, Prestea
and Nzema.
The second type of deposit found within the Ashanti belt are la minated quartz vein deposits
containing free gold. Fault filled quartz vein deposits also occur along the Ashanti trend but are only
present at Obuasi and Prestea. The third type of deposit are pa leo-placer deposits within the
Tarkwaian sedimentary basin which are hosted within narrow cong lomerate horizons intercalated
with sandstone units characterized by iron oxides cross beddings. Paleoplacer deposits occur in the
southern portion of the Tarkwa basin and examples include Tarkwa, Teberebie and Iduapriem. The
fourth type of deposit found within the Ashanti belt are intrus ive hosted deposits which occur along
second order structures such as the Akropong trend in the Kumasi basin and the Manso trend in the
Southern portion of the Ashanti belt. These deposits can be hos ted both within felsic and mafic
intrusives and are characterized by a penetrative fabric where gold is associated with pyrite and
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arsenopyrite. Examples of such deposits include Edikan and Pamp e along the Akropong trend and
Benso and Hwini Butre along the Manso trend. The fifth type of deposit found within the Ashanti belt
is late thrust fault associated quartz vein deposits. The Daman g mine which is located just west of
Wassa is the only known thrust fault related deposit in the Ashanti belt. The deposit is characterized
by low angle; undeformed extensional and tensional veins associ ated with low angle thrust faults.
This type of deposit contrasts with the last type of deposit found with the belt, the multi-phase folded
Wassa vein deposit. The Wassa mineralisation consists of greens tone-hosted, low sulphide
hydrothermal deposits where gold mineralisation occurs within f olded quartz-carbonate veins. The
Wassa deposit can therefore be classified as an Eoeburnean folded vein system and is the only such
deposit recognised to date within the Ashanti belt.
Host rocks in the Wassa mine area have been affected by at least four phases of ductile deformation,
producing a polyphase fold pattern at the mine scale. Discrete high-strain zones locally dissect this
fold system. The structural history of the Wassa area is import ant in that the various deformational
events have been responsible for the emplacement of the gold mineralisation as well as the geometry
of the zones themselves. Minera lised zones at the Wassa Mine ar e related to vein swarms and
associated sulphides that form ed during the Eoeburnean deformat ional event. All rock types
underlying the Wassa Mine appear to be altered to variable degrees with the most common alteration
consisting of a carbonate-silica-sulphide assemblage.
The Wassa mineralisation is subdivided into a number of domains, namely: F Shoot, B Shoot, Zone
242, South-East, Starter, 419, Mid-East, and Dead Man’s Hill. Each of these represents
discontinuous segments of the main mineralized system. The SAK deposits are located
approximately 2 km to the southwest of the Wassa Main deposit on the northern end of a well-defined
mineralized trend parallel to the Wassa Main trend. The mineral isation is hosted in highly altered
multi-phased greenstone-hosted qua rtz-carbonate veins interlaced with sedimentary pelitic units.
The SAK mineralisation is subdivided into a number of domains as well, SAK 1, 2 and 3.
Mineralisation within the Wassa Mine is structurally controlled  and related to vein densities and
sulphide contents. The mineralisation generally consists of bro adly tabular zones containing
dismembered and folded ribbon-like bodies of narrow quartz vein  material. Three vein generations
have been distinguished on the basis of structural evidence, ve in mineralogy, textures and
associated gold grades.
Gold grades broadly correlate with the presence of quartz-dolom ite/ankerite-tourmaline bearing
quartz veins and the presence of sulphide minerals (predominant ly pyrite) within and around the
quartz veins. Gold grades appear to be spatially restricted to the quartz veins, vein selvages and the
immediate wall rocks. The alteration haloes developed around the veins and pervasively developed
within the core of the Wassa Fold contain lower grade mineralisation.
According to the grade assays in various exploration campaigns and historic processing production
records, both silver (Ag) and arsenic (As) are in relatively low content. In the Wassa Project, gold is
the only prime element, and there is no concern around harmful mineral or element such as arsenic.
6.3.2 Hwini Butre
The Hwini Butre deposits can be characterized as mafic intrusive hosted, orogenic shear zones. The
deposits are hosted within diorite and granodiorite intrusive rocks of the Mpohor complex. The Father
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Brown deposit is characterized by well-developed fault-filled q uartz veins , whereas the Adoikrom
deposit is a shear zone hosted deposit characterized by intense potassium and silica alteration
assemblage.
Analysis of geophysical surveys and topographical features have  identified several north to north-
northeast trending regional features running through the area which are tentatively interpreted as
boundary faults along the margins of the Ashanti Belt. The Mpoh or complex exhibits the underlying
north-south trends but also has extensive cross cutting features present particularly in the north-west
orientation. These structural features are second order or subsidiary structures splaying from primary
structures.
The Adoikrom, Father Brown and Dabokrom deposits occur in the s outh portion of the Mpohor
complex and appear to be controlled by a series of shallow to m oderately dipping faults and shear
structures with dips varying from 20° to the south at Dabokrom and steepening to 65° to the northwest
at Adoikrom.
6.3.3 Benso
The Benso deposits can also be characterized as mafic intrusive  hosted, orogenic shear zones
deposits, which are hosted by Birimian metavolcanics into which  coarse plagioclase porphyry units
have intruded and are generally conformable with the volcaniclastic units.
At Subriso East, the metavolcanics host complex quartz vein sys tems associated with intense
shearing and abundant sulphide mineralisation. At Subriso West,  the presence of intermediate
porphyry intrusive appears to play a more significant role and quartz veining is less extensive and
broad scale silicification is more common. The contacts between metavolcanics and porphyry have
been identified as potential targets for higher grade gold mineralisation.
The mineralisation hosting structures generally dip steeply towards the west with foliation generally
parallel to the bedding. The aeromagnetic interpretation reveal s a north to north-northeast striking
fault system along the course of the Ben River with several other fracture systems also evident with
strikes varying between the northwest and northeast. The Subriso East deposit is interpreted to dip
less steeply to the west at approximately 50°.
Oxidation associated with weathering is variable but generally limited. The weathering forms a layer
of lateritic clay rich material grading into a soft saprolite. The vertical depth is generally 10 m or less
but can reach depths of 30 m in places. There is a sharp boundary between oxide and fresh material
with a narrow and poorly developed transition zone.
6.3.4 Chichiwelli
The Chichiwelli deposits can also be characterized as mafic intrusive hosted, orogenic shear zones,
the deposits are hosted within diorite and granodiorite intrusi ve rocks. The mineralisation zones at
Chichiwelli are similar to those observed at Benso, with the mineralised hosting structures generally
dipping to the east.
The Chichiwelli deposit consists of two sub-parallel mineralised trends which hosts two distinct types
of mineralisation. Mineralisation at the Chichiwelli West zone is shear zone hosted with a carbonate,
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sericite and potassic alteration assemblage, while mineralisation along the Chichiwelli East trend is
quartz vein associated with an ankerite and sericite alteration assemblage. Mineralisation is spatially
associated with pyrite at both deposits.
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7 Exploration, Sampling, and Assaying
SRK has not participated in the exploration conducted for Wassa  gold project. The information
regarding the exploration is derived from the data provided by the client and through discussions with
geologists engaged in the fieldwork.
7.1 Exploration
Systematic exploration work has been conducted on the GSWL properties over a couple of centuries
as the earliest record of gold business within the Hwini-Butre mining lease dates back to the late 15th
century with the Portuguese colonial explorers. Evidence of col onial mining and local small-scale
mining still remains with pits and adits mapped within all the mining leases and prospecting licenses.
A layout of current GSWL mining leases and prospecting licenses is shown in Figure 7-1.
Airborne and ground geophysical surveys consisting of aeromagne tics, radiometrics and Induced
Polarization (IP) were conducted on these properties. Strong gold targets have been prioritised from
these satellite imagery and geophysical interpretations followed with geochemical anomalies, which
had previously been identified following multiple stream and so il geochemical sampling programs.
To date, these various geophysical techniques continue to aid re-ranking of prospective targets within
the various landholdings.
Detailed geochemical surveys over the mining leases and prospecting licenses has been an effective
tool in locating mineralisation. Records of various geochemical  surveys has been progressively
reviewed since 1988 to date, around the mined-out open pits and adits.
GSWL has continued with exploration aimed at re-interpretation of geophysical and geochemical
targets. Moreso, testing of surficial and historical anomalies around the mined-out open pits and
along strike of known mineralisation zones.
GSWL has refocused exploration to expand the existing resources  beyond the current mined out
areas by following up on the prioritised and re-ranked geochemi cal targets along strike of known
mineralisation and up/down dip of the mined-out open pits.
Untested greenfield geochemical targets are being reviewed along with surficial and up-dip potential
mineralisation of underground oper ations. Historical brownfield s targets like Dead Man Hill have
been identified and prepped to contribute oxide ore for processing.
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Figure 7-1: Layout of GSWL Mining Leases and Prospecting Licenc es Linked by Laterite
Sheeted Haul Road
7.1.1 Wassa
Modern exploration programs on the Wassa concession began in th e early 1990s with satellite
imagery and geophysical surveys which identified geophysical lineaments and anomalies over small
scale and colonial mining areas. Stream and soil geochemistry sampling programs were conducted
over the geophysical anomalies and identified multiple linear g old in-soil anomalies as illustrated in
Figure 7-2.
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Figure 7-2: Wassa Au-in-Soil Anomalies with Prioritised Targets and Deposits
A high resolution, helicopter geophysical survey was conducted over the entire Wassa Mining Lease
to generate different derivatives (namely, Electromagnetic, Res istivity, Magnetic, Radiometrics and
Horizontal gradient of the Magnetic).
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Figure 7-3: Layout of Wassa Airborne Magnetic Survey Coverage
Source: GSR, 2004.
Grassroots exploration was conducted concurrently during the va rious phases of the resource
expansion drillings within the open pit areas. Areas south of the main open pit like 419 and South
Akyempim open pits (SAK) were di scovered through conventional e xploration as a result. These
phased exploration to date include:
 1994 to 1997 Exploration for the Feasibility study by Pincock, Allen and Holt
 2002 to 2003 Due diligence for Mineral Resource/ Ore Reserve up grade and feasibility study
update
 2011 to 2019 Wassa underground High-Grade definition + brownfields exploration
 2021 to 2022 Chifeng Gold group, refocused and re-interpretatio n of geophysical and
geochemical targeting alongside upgrading of known underground resources
After the acquisition of Golden Star (Wassa) by the Chifeng Gold Group, the geochemical data review
within the Wassa Mining Lease has caused re-optimisation of oxide mineralisation around the mined
out Dead Man Hill open pit. Untested gold-in-soil anomalies along the multiple linear trends in Figure
7-2 above is being evaluated to generate pipeline of oxide mineralisation for the processing plant.
7.1.2 Benso and Chichiwelli
Golden Star acquired the Benso and Chichiwelli concessions from St Jude Resources in 2005 and
began with regional exploration programs. A number of geophysic al and geochemical anomalies
previously identified by St Jude were followed up per the labelled targets within Figure 7-4 below.
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Figure 7-4: Au-In-Soil Anomalies with Pit Outlines within the Benso Mining Lease
Structural mapping and interpretation commenced in 2012 within the mining lease to aid in defining
the controls of mineralisation and to determine the underground potential beneath the mined-out pits.
Induced Polarisation geophysical surveys were conducted over the Benso concessions in 2009 and
the program generated targets that were coincident with lithological trends and gold in soil anomalies.
Re-evaluation of surface geology and geochemical anomalies afte r the Chifeng Gold Group
acquisition has produced the latest open pit mine within the Benso Mining Lease, namely the I-Zone
pit which is a product of grassroot exploration and favourable gold price on the international market.
Further re-interpretation is ongoing to further understand the surface mineralisation and underground
potential beneath the mined-out pits, particularly Subriso West pit.
Benso (Chichiwelli) prospecting licence expired on December 30 th 2020, awaiting for Minister of
Lands and Natural Resources’s approval for renewal. The satellite imagery and coincident au in soil
anomaly within the Prospecting Licence (PL) has led to the deli neation of Chichiwelli East and
Chichiwelli West mineralised zone s. Since 2012, no exploration work has been done on the
concession.
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7.1.3 Hwini Butre
Early European reports indicate the Dabokrom area, Hwini Butre mining lease, may have been a
major source for gold sold to Portuguese explorers when they first arrived in Ghana in the late 1400’s.
European interest grew in the 1800’s with the presence of gold and proximity to Sekondi-Takoradi,
which had developed as a port to service mines at Tarkwa, Prest ea and Obuasi. Many exploration
licences were granted during the gold boom of 1898-1902 and by the 1930’s most of the area was
under license to various local and European interests.
At Dabokrom within Hwini Butre Mining Lease (HBML) a shaft was sunk by Oceania Consolidated in
the 1930’s to follow the shallow dipping quartz veins. The property was worked for several years but
stopped in 1939 at the start of World War 2.
Golden Star acquired St Jude and the Hwini Butre concession in late 2005 and commenced
exploration work in early 2006. Exploration activities concentr ated on the previously defined
mineralisation at Adoikrom North, Adoikrom, Dabokrom and Father Brown.
Regional exploration programs over the concession were conducte d by targeting a number of
geochemical and geophysical anomalies previously identified by St Jude, these anomalies were
mainly tested by the use of Rotary Air Blast (“RAB”) drilling. A combination of 4 m deep auger and
shallow auger at a grid spacing of 400 m by 50 m was also carri ed out to further test the existing
gold-in-soil anomalies and gaps in the geochemistry sampling over the Hwini Butre concessions.
Hwini Butre exploration activities were focused on the northern parts of the concession where several
colonial gold occurrences such as Breminsu, Apotunso (per Figur e 7-5), Abada, Whinnie and
Guadium are located. Previous soil sampling in these areas iden tified several anomalies and the
follow up programs included deep auger and RAB drilling. The Mi neral Resource definition drilling
program continued in 2010 at Father Brown, Adoikrom and Dabokro m. The Mineral Resource/ Ore
Reserve delineated was mined out by 2014 but exploration along strike continued to discover the
continuity of mineralisation from geophysical targets and geochemical surveys on the Hwini Butre
Mining Lease (HBML).

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Figure 7-5: Gold in Soil Anomaly within Hwini Butre Mining Leas e with Adoikrom and Father
Brown Open Pits
Chifeng Gold Group has refocused brownfields prospects, grass r oots exploration targets and
untested greenfields targets. Re-interpretation of structural controls, geophysical targets and
geochemical anomalies is being done to test five additional tar gets along the Hwini Butre Benso
(HBB) corridor.
The regional exploration within the eastern blocks of Manso 1 PL, Manso 2 PL and Chichiwelli PL is
focusing on geochemical anomalies and geophysical targets review to follow up on the fold closure,
east of the mining leases.
7.2 Drilling
Drilling is carried out by a combination of Diamond Drill (“DD”), Reverse Circulation (“RC”) and RAB
techniques. In general, the RAB method is used at early stages for follow up to soil geochemical
sampling and testing contacts and mineralisation extensions around the production areas and has a
maximum drilling depth of around 30 m. Exploration continues across multiple leases with mapping
and soil sampling. Prospective targets may be drill tested with either air core or RC drilling.
The Wassa, Benso and Hwini Butre Mining Leases are advanced pro perties, so details of all drill
results are not required in this report. This section provides an overview of drilling and representative
plans and cross-sections as shown in Figure 7-6 to Figure 7-8.
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Concurrent grass root exploration and Mineral Resource definiti on drilling has bee n conducted
between 2006 and 2012.
As of 31 March 2024, the summary of the exploration data used in the Mineral Resources Estimates
is listed in Table 7-1.
Table 7-1: Summary of Exploration Data used in the Mineral Resources Estimates
Location Type Holes Drill Meters(m)
B Shoot
DD 3,755 731,162.9
RC 485 50,314.9
242
DD 190 42,023.4
RC 79 8,773.0
GCRC 4,332 92,859.0
DMH
DD 32 4,453.8
RC 205 15,618.4
GCRC 1,900 52,967.0
I Zone
DD 21 2,245.4
RC 42 4,114.7
GCRC 191 9,214.0
FB/ADK
DD 435 66,229.0
RC 214 16,323.0
GCRC 3,087 72,037.0
Chichiwelli
DD 23 3,692.0
RC 483 29,802.0
Total
DD 4,456 849,806.5
RC 1,508 124,946.0
GCRC 9,510 227,077.0

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Figure 7-6: Wassa Main Deposit Vertical Section 19975mN Showing  Folded Lithological
Sequence

Figure 7-7: Wassa Main Vertical Section 19925mN Showing Interpretation with Tight Spaced
Drilling

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Figure 7-8: Hwini Butre Drill Section through 33100 mN
7.2.1 Surface Drilling
RC pre-collar with DD core tail drilling is used as the main method for obtaining samples for Mineral
Resource estimation and is carried out along drill lines spaced  between 25 and 50 m along
prospective structures and anomalies defined from soil geochemistry and RAB drilling. RC drilling is
typically extended to depths in the order of 100-125 m. The DD method is used to provide more
detailed geological data and where more structural and geotechnical information is required.
Generally, the deeper intersections are also drilled using DD a nd, as a result, most section lines
contain a combination of RC and DD drilling.
RC and DD drilling is conducted with a geologist on site to align the drill rig and check the drill head
dip and azimuth. Downhole surveying is conducted using a single shot camera, for RC and DD holes
at the bottom of holes exceeding 30 m depths and then taken progressively every 30 m up hole. The
single shot camera records the dip and azimuth for each survey which is validated and recorded by
the geologists or is recorded by a Reflex survey instrument and captured in the database as well as
being filed in the respective drillhole file folders on site.
Drilling depths within the mining leases do not generally excee d 250 m but with the discovery of
higher grades below the mined-out open pits after 2011, hole depths have increased. In the 1st half
of 2014, two gyro survey instruments were utilized to resurvey several of the deeper holes. In total,
153 holes, drilled during 2012 to 2014, were resurveyed. The gyro survey readings were conducted
every 10 m both in and out of the hole and the values were then averaged. The 153 gyro surveyed
holes were updated in the database and subsequently used for the Mineral Resource estimates. The
gyro surveys showed that there was some deviation in the holes below 250 m drilled depth.
Deviations varied from location to location depending on drill orientation with a general tendency for
the hole to steepen and swing to the north.
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Drilling of some of the deeper targets required the use of dire ctional drilling methods. The deeper
holes, often exceeding 1,000 m, are drilled from surface using HQ (63.5mm) sized core and this
initial hole (referred to as t he “mother” hole) is drilled to t he depth where the first directional hole
would be started. The directional hole (or “daughter” hole) is drilled using a smaller core size, NQ
(47.6 mm) and is deviated from the mother hole initially using a casing wedge which is oriented in
the direction of the mineralised target. Once the initial deflection has been achieved with the wedge,
the hole deviation is controlled using a down hole directional motor which can change the dip and
azimuth of the hole by approximately plus or minus 1.5 degrees over a 10-metre run. The direction
of the hole can also be controlled by using various combination s of down hole stabilisers and drill
bits. The step-wise deeper drilling fences typically involve mo ther holes with three to four daughter
holes from each of these. The deeper holes are surveyed, down hole with either a Reflex multi-shot
or gyro survey instrument. The surveys are taken while the hole  is being drilled as well as every 10
to 15 m from the bottom of the hole once it has been completed.
The majority of the drilling has been conducted by Golden Star (Wassa), although there are some
drillholes completed by previous concession owners that have been used to inform the Wassa long-
range model (by SGL) and Hwini Butre and Benso models (by SJR).  The drill data from prior
ownership has been validated and checked in the NI 43-101 Techn ical Report (GSR, 2021) to the
satisfaction of the QP for inclusion in interpretation and grade estimates.
All drillhole collars were surveyed using a Nikon Total Station (DTM-332) or Sokkia Total Station by
a Golden Star (Wassa) surveyor. Individual RC and DD holes are identified and marked in the field
with poly-vinyl chloride (PVC) pipes. RAB drill holes were surv eyed in the field and identified and
marked with wooden pegs.
7.2.2 Underground Drilling (Wassa Main)
Underground DD is performed using electric-hydraulic diamond drills utilizing the underground mine’s
1,000 V power supply. Core drilled underground is HQ, NQ or NQ2 (50.6 mm) in core size. The final
drilling density for classification as Measured Mineral Resource is designed to be 15 m along strike
and 13 m down dip, or tighter. With the orebody generally strik ing north-south (on the mine grid),
typical drilling azimuths range +/-30 degrees each side of 090˚  or 270˚ azimuth, depending on
whether the drills are set up on the hanging wall or footwall side of the orebody. Dips generally range
between +30˚ to -60˚.
Downhole surveying is conducted using a Reflex multi-shot downhole surveying tool. When collaring,
a single survey is taken at 10-12m depth. At the first survey, the drill hole orientation must fall within
±2o azimuth and ±1.5o dip tolerance, when compared to design. For any hole where the first survey
falls outside of tolerance, the geologist has the discretion to  either terminate th e drill hole and re-
collar at the drilling company’s expense, or to continue the hole. At the completion of the drill hole,
multi-shot surveys are collected at 15 m intervals on the way out.
Drill hole collar locations are captured by the underground mine surveying team. The surveyors use
either a Leica TS15 total station, or a Leica TS16 total station to record the collar position in X, Y, Z
location. The total station is accurate to less than two seconds in azimuth. In cases where the mine
surveyors cannot identify the drill hole collar site, the designed collar coordinates are recorded in the
databases.
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7.2.3 RAB/AC Drilling
RAB and AC drilling is used for exploration but is not used to inform any of the current Mineral
Resource estimates.
7.3 Sample Preparation, Analyses, and Security
The measures implemented by GSR related to sample preparation, analysis and security are
considered by the Competent Person to be consistent with standard industry practice and of sufficient
quality to include in the estimation of Mineral Resources. Gold en Star (Wassa) has a standard
approach to drilling and sampling on all mining leases and prospecting licenses in Ghana. Sampling
is typically carried out along the entire mineralised drilled length. Sample recovery is good across all
deposits drilled to date. Ground conditions are generally good and air drilling techniques (AC/ RAB
and RC) are avoided below the groundwater table where DD is applied.
7.3.1 Sampling
For RC drilling, samples are collected every 1 m. Where DD holes have been pre-collared using RC,
the individual 1 m RC samples are combined to produce 3 m compo sites which are then sent for
analysis. Should any 3 m composite sample return a significant gold grade assay, the individual 1 m
samples are then sent separately along with those from the immediately adjacent samples.
Resource definition drill core samples are collected, logged, a nd then cut in half along the foliation
axis using diamond core saws. Sample length range from 0.3m min imum length to 1.5m maximin
length, with the standard sample length being 1.0m. The core is  cut according to mineralisation,
alteration, or lithology.  The sampling concept is to ensure th at a representative sample of the core
is assayed. The remaining half core is retained in the core tray, for reference and additional sampling,
if required. Grade control core is whole core sampled.
RC sampling protocols were established in 2003. The composite length of 3 m has been established
to allow a minimum of at least two composites per drillhole int ersection based on experience from
exploration drilling and mining. The hanging wall and footwall intersections can generally be easily
recognised in core from changes in pyrite content and style of quartz mineralisation.
The 3 m composite sampling methodology is:
 A sample of each drilled meter is collected by fitting a plastic bag on the lower rim of the cyclone
to prevent leakage of material;
 The bag is removed once the “blow-back” for the meter has been completed and prior to the
commencement of drilling the subsequent meter;
 Both the large plastic sample bags and the smaller bags are clearly and accurately labelled with
indelible ink marker prior to the commencement of drilling. This is to limit error and confusion of
drilling depth while drilling is proceeding;
 3 m composite samples are taken by shaking each of the 1 m samp les (approximately 20 kg)
and taking equal portions of the 3 consecutive samples into a s ingle plastic bag to form one
composite sample (approximately 3 kg);
– IIIC-83 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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 Composite samples are taken using tube sampling, which uses a 5 0 mm diameter PVC tube
which has been cut at a low oblique angle at one end to produce  a spear of approximately 600
mm length;
 The technique assumes that a sample from the cyclone is stratified in reverse order to the drilled
interval. A representative section through the entire length of the collected sample is considered
to be representative of the entire drilled interval;
 The PVC tube is shuffled from the top to bottom of the sample, collecting material on the way.
The “shuffling” approach ensures sample accumulated in the tube  does not just push the
remaining sample away; and
 Material in the tube is emptied into the appropriately labelled sample bag and in the case of 3 m
composite samples, stored separately from the 1 m samples.
The 1 m sample collection methodology is:
 1 m re-sampling of selected mineralised composite zones using t he 20 kg field samples is
undertaken with a single stage riffle splitter;
 Splitter is clean, dry, free of rust, and damage is used to red uce the 20 kg sample weight to a 3
kg fraction for analysis;
 Care is taken to ensure that the sample is not split when it is  transferred to the splitter, and is
evenly spread across the riffles;
 When considered necessary, the sample is assisted through the splitter by tapping the sides with
a rubber mallet;
 Excessively damp or wet samples  are not put through the splitte r, but tube-sampled or grab-
sampled in an appropriate manner. Alternatively, the sample is dried before splitting. A common-
sense approach to wet sampling is adopted on a case-by-case basis;
 Clods of samples are not forced through the splitter, but apportioned manually in a representative
manner; and
 Splitter is thoroughly cleaned between each sample using a brus h. Where possible, the splitter
is cleaned using an air gun attached to the drill rig compressor.
RAB and AC samples are collected and bagged at 1 m intervals. A s the samples are generally
smaller in size than the RC samples, 3 m composites are prepare d by shaking the samples
thoroughly to homogenize the sample, before using the PVC tube to collect a portion of the three
individual 1 m samples. After positive results from the 3 m com posites, the individual 1 m samples
are split to approximately 2 to 3 kg using the Jones riffle splitter and then submitted to the laboratory
for analysis.
7.3.2 Sample Preparation
Sample preparation on site is restricted to core logging and co re cutting or RC and RAB sample
splitting. The facilities consist of enclosed core and coarse r eject storage facilities, covered logging
sheds and areas for the splitting of RC and RAB samples. Sub-sampling of RC and RAB samples is
carried out using a Jones Riffle splitter.
– IIIC-84 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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7.3.3 Sample Dispatch and Security
Samples are collated at the mine site after core cutting or sam ple splitting, and then transported to
the primary laboratory (Intertek Minerals Ltd, Tarkwa: ISO/IEC 17025) for the completion of the
sample preparation and chemical analysis. Samples are trucked b y road to the laboratories in
Tarkwa.
Sample security involves two aspects, namely, maintaining the c hain of custody of samples to
prevent inadvertent contamination or mixing of samples, and rendering active tampering of samples
as difficult as possible.
The transport of samples from si te to the laboratory is by road  using a truck dispatched from the
laboratory. As the samples are loaded, they are checked, and th e sample numbers are validated.
The sample dispatch forms are signed off by the driver and a co mpany representative. The sample
dispatch dates are recorded in the sample database as well as the date when results are received.
No specific security safeguards have been put in place by GSR t o maintain the chain of custody
during the transfer of core between drilling sites and sample preparation and assaying facilities. Core
and rejects from the sample preparation are archived in secure facilities at the core yard and remain
available for future testing.
7.3.4 Laboratory Procedures
Sample assays have been performed at the Wassa Site Laboratory (WSL), SGS Tarkwa or Intertek
Minerals Ltd (formerly named Transworld Ltd. (“TWL”)). The two commercial laboratories are located
at Tarkwa. Golden Star (Wassa) submits quality control samples to every batch of primary samples
sent to laboratory for testing purposes.
Both SGS and Intertek laboratories are independent of Golden Star (Wassa) and are accredited for
international certification for testing and analysis.
 SGS, Minerals Division – Tarkwa: ISO 17025 and ISO 9001; and
 Intertek Minerals Ltd, Tarkwa: ISO/IEC 17025.
The sample preparation and analytical processes at the WSL, Intertek, and SGS differ slightly. WSL
prior to July 2007 operated as a metallurgical sample processing laboratory at the Wassa mine site.
Subsequently, WSL has been used a s the primary laboratory for g rade control open pit drilling
samples and mine grab samples. The WSL is prone to contaminatio n as the jaw crusher and
secondary crushing areas are dusty. Moreso, the manual capture of assay values from the desktop
computers at WSL gives room for transcription errors. For these  reasons, the WSL does not assay
samples related to exploration or resource definition drilling.
Wassa Site Laboratory
The sample preparation and analysis process at the WSL is as follows:
 Sample reception, sorting, labelling and loading;
 Dry entire sample (3 kg) at 110°C for between 4 and 8 hours;
– IIIC-85 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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 Jaw crush entire sample to 3 mm, and secondary Keegor crusher to 1 mm;
 Split 3 kg sample and pulverize for 3 to 8 minutes to 95% passing 75 μm;
 Sample homogenization using a mat rolling technique, and sub-sa mple 1 kg into bulk leach
extractable gold (BLEG) roll bottle;
 Bottle roll for 12 hours with LeachWellTM accelerant. Allow to settle for 30 to 60 minutes;
 Filter 20 ml aliquot from bottle;
 Di-isobutyl Ketone extraction and atomic absorption spectroscop y (AAS) determination of gold
content; and
 1 in 10 residue samples are retained for gold determination using fire assay.
Transworld
TWL (now Intertek) was the primary laboratory for core samples until July 2007, when it was
discontinued due to the following issues:
 Contamination due to poor dust control in pulverizing area of the laboratory. Use of dust attracting
cloth gloves for sample handling. BLEG aliquot preparation area containing dirt and liquids, which
may result in sample cross-contamination.
 Large fluctuation in employee numbers (60 to 180), which resulted in a risk of training and quality
control issues when increasing employment numbers over a short period of time.
 The use of a manual data tracking and capture system, which increased risk of data entry errors.
Golden Star (Wassa) considered this to be a sub-optimal process for a commercial laboratory.
The sample preparation and analysis process used by TWL is illustrated in Figure 7-9 below.
– IIIC-86 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 7-9: Transworld Laboratories Sample Processing Flow Sheet
SGS Tarkwa
The SGS laboratory (Tarkwa) was used for drill core samples fro m July 2007 to August 2017, with
the sample preparation and analysis process as follows:
 Sample received, entered in LIMS, worksheets, printed and samples sorted;
 Samples emptied into aluminium dishes;
 Dry entire sample at between 105 and 110°C for 8 hours;
 Jaw crush entire sample to 6 mm;
 Split sample using a single stage riffle splitter, to result in a 1.5 kg sub-sample;
 Pulverize sub-sample for 3 to 5 minutes, to give 90% passing 75 μm;
– IIIC-87 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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 Sample homogenization using a mat rolling technique, and put 1 kg of sample into the BLEG roll
bottle;
 Remaining sample is retained as pulp and crushed sample duplicates;
 Bottle roll for 12 hours with LeachWell™ accelerant. Allow to settle for 2 hours;
 Filter 50 ml of aliquot; and
 Di-isobutyl Ketone and AAS for gold grade determination.
Intertek Tarkwa
Subsequent to 2017, Golden Star (Wassa) discontinued using SGS, Tarkwa laboratories and began
shipping samples to Intertek, Tarkwa Laboratories. The Intertek  lab sample flow sheet is shown in
Figure 7-10 below. The reason for the change was attributed to poor turn-around time in assay
results. Since the prior issues with Transworld/ Intertek, ownership of TWL had changed to Intertek
who had implemented internationally recognised standards with c hanges in management and
procedures.
Figure 7-10: Intertek Sample Processing Flow Sheet
– IIIC-88 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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7.3.5 Quality Control and Quality Assurance
Quality control measures are set in place to ensure the reliability and trustworthiness of assay data,
and to ensure that it is of sufficient quality for inclusion in  the subsequent Mineral Resource
estimates. Quality control measur es include written field procedures and independent verifications
of aspects such as drilling, sur veying, sampling and assaying, data management and database
integrity. Appropriate documentation of quality control measures and analysis of quality control data
are an integral component of a comprehensive quality assurance program and an important
safeguard of project data.
The field procedures implemented by Golden Star (Wassa) are comprehensive and cover all aspects
of the data collection process such as surveying, drilling, core and RC cuttings handling, description,
sampling and database creation and management. At Wassa, each task is conducted by
appropriately qualified personnel under the direct supervision of a qualified geologist. The measures
implemented by Golden Star (Wassa) are considered to be consistent with industry best practice.
The quality controls employed by Golden Star (Wassa) include:
 Field duplicates used to check sampling precision and deposit variability. Two separate samples
are collected at the drill site and bagged separately from whic h two individual samples are
produced. The results of these checks can be useful in highlighting natural variability of the grade
distribution.
 Pulp duplicates used as a check of sampling precision and coars e gold in pulps. Two separate
pulp samples are prepared from a single coarse reject after sam ple splitting and on-site
preparation. The results are useful in indicating problems with sample preparation and splitting.
 Repeats as a check of analytical precision and coarse gold. Two separate aliquots are prepared
from separate samples taken from the original coarse reject and  the two samples’ results are
compared.
Blanks for highlighting contamination problems and cross labelling when samples are mislabelled
in the laboratory.
 Standards as a check of analytical precision and accuracy.
Golden Star (Wassa) relies on bot h the laboratory operators Qua lity assurance, quality control
(QA/QC) processes for assaying, as well as Golden Star (Wassa)’  own independent QA/QC
program. The Golden Star (Wassa) program includes inserting blanks, Certified Reference Materials
(CRMs), and pulp or coarse reject duplicates into sample batches, before sample submission to the
lab. Golden Star (Wassa) also provides sample dispatch lists to  the laboratories, to ensure that all
samples dispatched from site are received at the lab.
Golden Star (Wassa) has supplied QA/QC reports to various consultants over the numerous drilling
campaigns since 2004, and a summary of the historical and current QA/QC results is included here.
7.3.6 Comparison of  Assay Methodologies
In 2003, during open-pit operations, it was recognised that the re was a variance between primary
and duplicate assay grades of the same sample, as well as a var iance between the planned mine
grade to the mill reconciled grade. The conventional 50g fire assay being used at the time displayed
– IIIC-89 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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poor reproducibility between field duplicates. This effect was also evident between pulp duplicates,
although not as marked. The conclusion was that a component of coarse gold was present in the
samples and contributed to poor reproducibility between samples. It was recommended to switch to
an analytical process that made use of significantly larger sam ple masses, such as LeachWell™
assays.
To address this, Golden Star (Wassa) changed the assay procedur e from the 50-gram fire assay
method to a 1kg BLEG assay, with a LeachWellTM accelerant. Gold grade was determined using an
AAS finish. Initially, samples were split by a rotary splitter and leached for six hours. Following the
analysis of the leach tailings, the leach time was extended to 12 hours.
Due to time constraints, the use of the rotary splitter was dis continued, and a Jones Riffle splitter
was used to split sub-samples fr om the larger RC drill hole sam ples. The difference between the
reproducibility of fire assay ve rsus larger BLEG assays is illu strated in Figure 7-11. It shows a
significant improvement with respect to sample reproducibility between the fire assay and the BLEG
methodologies. Using BLEG, 80% of pairs report Half Absolute Re lative Difference (HARD)
precisions of less than 17%, compared to the 35% precision attr ibutable to the fire assay method.
SRK recommended that Golden Star (Wassa) continue to monitor th e reproducibility of the sample
grades from the paired data analysis.
Figure 7-11: ARD Plot Comparing Fire Assay and BLEG for Field Duplicates

– IIIC-90 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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8 Data Verification
SRK has not carried out any independent collection and verifica tion of individual samples or assay
results. SRK has, however, obtained and reviewed the QA/QC resu lts produced by Golden Star
(Wassa), its consultants and the laboratories themselves.
SRK reviewed the core and samples available on site (core shed)  and cross-checked them against
the geological logs and assay records.
The quality of the results is generally considered good. Golden Star (Wassa) frequently sends
samples with known values but “blind” test samples to the labor atory and monthly batch results are
analysed, and any anomalous results are queried immediately. A small number of anomalous and/ or
poor results have been noted over the years, but these have been identified and the reasons fall into
two main categories, namely:
 Mislabelling of individual samples, standards and blanks.
 Individual batch issues corresponding to changes in the laboratory setup or calibration, in these
cases re-assay has been carried out.
The results of the current QA/QC program indicate that performa nce is consistent with industry
standards. The QA/QC program includes check samples which show reasonable duplicate
performance. The duplicates are selected from coarse rejects from the initial preparation.
8.1 Verifications by Golden Star (Wassa)
The field procedures implemented by Golden Star (Wassa) involve several steps designed to verify
the collection of exploration data and minimise the potential f or inadvertent data entry errors. The
data entry and database managemen t involve two steps punctuated  by validation steps by the
logging geologist. All data is thoroughly checked prior to the incorporation into the project database.
Analytical data is also routinel y checked for consistency by Golden Star (Wassa) personnel. Upon
receipt of digital assay certificates, assay results together with the control samples are extracted from
the certificates and imported into the Acquire database. Failures and potential failures are examined
and depending on the nature of the failure, re-assaying is requested from the primary laboratory.
Analysis of quality control data is documented along with relevant comments or actions undertaken
to either investigate or mitigate problematic control samples.
8.2 Verifications by SRK (Between 2019 and 2022)
8.2.1 Duplicates
SRK has reviewed the supplied QA/QC reports, and a summary of the historical and current QA/QC
results is included here.
Historical data on field duplicates, from between 2003 and 2007  were poorly correlated. Supplied
documentation from the time indicates that the field sampling techniques were identified as the likely
cause. Improvements since 2008 are thought to be due to increas ed sample splitting training and
– IIIC-91 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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awareness amongst Golden Star (Wassa) sampling crew members, rather than improvements at the
laboratory.
From 2011, Golden Star (Wassa) discontinued the use of pulp samples for determining repeatability.
Instead, coarse reject material (leftover material from the laboratory primary crush stage) was used
as duplicate sample material.
During the sample prep stage, after the drill core passed through primary crushing, the excess coarse
reject material was collected and returned to Wassa. This mater ial was then re-numbered and re-
submitted to the laboratory for repeat analysis. Coarse reject replicates were used to monitor the
sample preparation processes of the laboratory.
Figure 8-1: Correlation Plot of Coarse Reject Replicates and Original Assays

Laboratory coarse reject replicates pair analysis for all samples generated between 2019 and 2022
shows improved assay grade reproducibility. About 3% of the replicates below 1g/t do not correlate
with the original assays but these are within acceptable limit for a gold deposit like Golden Star
(Wassa).
8.2.2 CRMs and Blanks
CRM was introduced by GSR into the sample stream to monitor the  accuracy, precision and
reproducibility of the assay results. CRMs were sourced from Geostats Pty Ltd (“Geostats”), and
from Gannet Holding Pty Ltd (“Gannet”). Although the CRM could be easily identified by the
laboratory, the actual grade of the standard would be difficult to determine due to the large number
of different CRM types used. The summary results of CRM types in use between 2019 and 2022 as
supplied by both Geostats and Gannet are shown in Table 8-1 and Table 8-2; overall the results are
satisfactory indicating that there are no concerns with the ana lytical method employed by the
laboratories.
y = 1.0529x - 0.004
R² = 0.9723
0
1
2
3
0123
Replicates
Assay
DD - Assay vs Replicates
– IIIC-92 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Table 8-1: CRM from Geostats Used within HBB between 2019 and 2022
Standard Number
analyzed
Certified
Value
Analytical
average
Lower
limit
Upper
limit Failures Bias %
Failures
G307-1 45 3.350 3.375 2.84 3.86 0 negative 0%
G307-4 51 1.360 1.324 1.15 1.57 0 negative 0%
G912-3 192 2.100 2.037 1.74 2.46 0 negative 0%
G913-2 33 2.420 2.334 1.97 2.87 0 negative 0%
G913-3 1 2.420 2.330 1.97 2.87 0 negative 0%
G913-4 1 2.420 2.400 1.97 2.87 0 negative 0%
G914-2 21 2.450 2.373 2.15 2.75 0 negative 0%
G915-2 50 4.940 4.968 4.34 5. 54 0 positive 0%
G916-2 12 1.960 1.905 1.75 2.17 0 negative 0%
G916-3 9 1.000 0.979 0.85 1.15 0 no 0%
G918-6 56 3.400 3.333 3.04 3.76 0 negative 0%
Table 8-2: CRM from Geostats Used within Wassa Main between 2019 and 2022
Standard Number
analyzed
Certified
Value
Analytical
average
Lower
limit
Upper
limit Failures Bias %
Failures
G307-4 206 1.360 1.337 1.15 1.57 0 no 0
G312-5 172 1.560 1.610 1.23 1.89 0 no 0
G314-5 22 5.300 5.030 4.34 6.26 0 negative 0
G314-7 58 2.430 2.381 2.01 2.85 0 negative 0
G318-4 26 5.790 5.501 4.98 6.6 0 negative 0
G912-3 180 2.100 1.998 1.74 2.46 0 negative 0
G913-2 363 2.420 2.328 1.97 2.87 0 negative 0
G914-2 181 2.450 2.378 2.15 2.75 0 negative 0
G916-2 111 1.960 1.945 1.75 2.17 0 no 0
G916-3 283 1.000 0.978 0.85 1.15 0 negative 0
G918-6 179 3.400 3.352 3.04 3.76 0 negative 0
G918-7 6 5.870 5.798 5.12 6.62 0 negative 0
Blank samples are routinely inserted into the sample stream to check for possible sample
contamination during the preparat ion and assaying process. Typi cally, blanks are inserted prior to
the delivery of samples for preparation and analyses. Between 2019 and 2022, the blank assay data
include 752 assays for HBB and 3,047 assays for Wassa main; all  assays for these blanks are
summarised in Table 8-3 and Table 8-4; overall, there is no indication of material cross contamination
during the sample preparation stage.
Table 8-3: Blank from Hwini Butre Benso Assays
Standard Number
analyzed
Certified
Value
Analytical
average
Lower
limit
Upper
limit Failures Bias %
Failures
Blank 752 0.010 0.010 0.001 0.08 0 no 0
Table 8-4: Blank from Wassa Main Assays
Standard Number
Analyzed
Certified
Value
Analytical
Average
Lower
Limit
Upper
Limit Failures Bias %
Failures
Blank 3,047 0.010 0.010 0.0001 0.44 1 no <0.5
– IIIC-93 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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8.2.3 Comments
SRK has conducted similar validation exercises on the historical assay QA/QC since 2014 and found
no material flaws that impacts on the reliability of the assay dataset for Mineral Resource estimation.
8.3 Verifications by SRK (Between 2023 and March 2024)
GSR regularly inserted certified standards, blanks and coarse field duplicates for the period between
2023 and March 2024. The QA/QC summary is listed in Table 8-5.
Table 8-5: QA/QC Summary Between 2023 and March 2024
Zone Category QC samples Total N of samples %Coverage
B Shoot
CRMs 4,070
90,474
4.50%
Blanks 4,362 4.82%
Field Duplicates 4,148 4.58%
Lab Check Duplicates 688 0.76%
242
CRMs 359
5,862
6.12%
Blanks 337 5.75%
Field Duplicates 1,193 20.35%
DMH
CRMs 469
9,924
8.00%
Blanks 425 7.25%
Field Duplicates 442 4.45%
8.3.1 B Shoot
For B Shoot, SRK was provided with 4,070 CRMs sample, 4,362 blanks samples, 4,147 coarse field
duplicates and 688 lab check duplicates.
CRMs
The pass rate within 2 standard deviations ranges from 80.82% t o 100% and the average is 96%.
Most of the CRMs pass rate are greater than 95%. Only three CRM s pass rate are less than 90%,
G319-5 is 84%, G916-1 is 80.82% and G918-2 is 87.27%, detailed in Table 8-6 and Figure 8-2
Table 8-6: B Shoot CRMs Summary Between 2023 and March 2024
CRM Element Expected CRM SD Samples Samples_
Mean
2SD
Samples
outside Pass Rate
G918-6 Au 3.40 0.12 817 3.33 5 99.39%
G916-2 Au 1.96 0.07 580 1.94 19 96.72%
G913-2 Au 2.42 0.15 28 2.39 0 100.00%
G319-5 Au 3.94 0.13 25 3.76 4 84.00%
G912-3 Au 2.10 0.12 823 2.03 6 99.27%
– IIIC-94 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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CRM Element Expected CRM SD Samples Samples_
Mean
2SD
Samples
outside Pass Rate
G312-5 Au 1.56 0.11 524 1.57 19 96.37%
G908-2 Au 0.21 0.02 103 0.21 0 100.00%
G912-4 Au 1.95 0.14 50 1.82 1 98.00%
G915-3 Au 9.22 0.55 78 8.66 0 100.00%
G916-3 Au 1.00 0.05 171 1.00 0 100.00%
G916-1 Au 1.70 0.06 73 1.62 14 80.82%
G918-2 Au 1.43 0.05 110 1.38 14 87.27%
G918-7 Au 5.87 0.25 423 5.74 6 98.58%
G314-7 Au 2.43 0.14 59 2.28 4 93.22%
G314-5 Au 5.30 0.32 206 5.07 0 100.00%

Figure 8-2: B Shoot CRM Samples Between 2023 and March 2024

– IIIC-95 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1621 ---
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Figure 8-2: B Shoot CRM Samples Between 2023 and March 2024


– IIIC-96 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 8-2: B Shoot CRM Samples Between 2023 and March 2024


Blanks
As shown in Figure 8-3, all samples result of gold are falling with 10X detection limit.
– IIIC-97 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 8-3: B Shoot Blank Samples Between 2023 and March 2024
Field Duplicates
Detailed in Table 8-7 and Figure 8-4, about 62% duplicate pairs are within 20% limits, however this
is not uncommon with precious metals due to the nugget effect for coarse duplicates.
Table 8-7: B Shoot Field Duplicates Summary Between 2023 and March 2024
Element Data Pairs Count
Relative Difference
<10% 10% - 20% > 20%
Au 4,148 1,589 38% 984 24% 1,575 38%

– IIIC-98 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 8-4: B Shoot Field Duplicates Between 2023 and March 2024
Lab Check Duplicates
GSR used SGS to check the gold grade. About 58% duplicate pairs are within 20% limits.
Table 8-8: B Shoot Lab Check Duplicates Summary Between 2023 and March 2024
Element Data Pairs Count
Relative Difference
<10% 10% - 20% > 20%
Au 688 241 35% 159 23% 288 42%

– IIIC-99 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 8-5: B Shoot Lab Check Duplicates Between 2023 and March 2024

8.3.2 242
CRMs
As shown in Table 8-9 and Figure 8-6, the pass rates within 2 s tandard deviations are 99.39% for
G918-6 and 98.98% for G912-3.
Table 8-9: 242 CRMs Summary Between 2023 and March 2024
CRM Element Expected CRM SD Samples Samples_
Mean
2SD
Samples
Outside Pass Rate
G918-6 Au 3.40 0.12 163 3.30 1 99.39%
G912-3 Au 2.10 0.12 196 2.02 2 98.98%

– IIIC-100 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 8-6: 242 CRM Sample Between 2023 and March 2024
Blanks
As shown in Figure 8-7, all samples result of gold are falling with 10X detection limit.
Figure 8-7: 242 Blank Samples Between 2023 and March 2024
Field Duplicates
Detailed in Table 8-10 and Figure 8-8: , about 67% duplicate pairs are within 20% limits.
– IIIC-101 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1627 ---
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Table 8-10: 242 Field Duplicates Summary Between 2023 and March 2024
Element Data Pairs Count
Relative Difference
<10% 10% - 20% > 20%
Au 1,193 522 44% 282 24% 389 33%

Figure 8-8: 242 Field Duplicates Between 2023 and March 2024

8.3.3 DMH
CRMs
Detailed in Table 8-11 and Figure 8-9, the pass rates within 2 standard deviations range from 90%
to 100%, the average is 95%.
– IIIC-102 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Table 8-11: DMH CRMs Summary Between 2023 and March 2024
CRM Element Expected CRM SD Samples Samples_Mean
2SD
Samples
Outside
Pass
Rate
G312-5 Au 1.56 0.11 117 1.58 3 97.44%
G913-2 Au 2.42 0.15 53 2.40 0 100.00%
G912-3 Au 2.10 0.12 142 2.09 3 97.89%
G918-6 Au 3.40 0.12 56 3.29 5 91.07%
G916-1 Au 1.70 0.06 50 1.65 5 90.00%
G918-2 Au 1.43 0.05 51 1.41 4 92.16%

Figure 8-9: DMH CRM Samples Between 2023 and March 2024

– IIIC-103 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1629 ---
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Blanks
As shown in Figure 8-10, all samples result of gold are falling with 10X detection limit.
Figure 8-10: DMH Blank Samples Between 2023 and March 2024
Field Duplicates
Detailed in Table 8-12 and Figure 8-11, about 68% duplicate pairs are within 20% limits.
Table 8-12: DMH Field Duplicates Summary Between 2023 and March 2024
Element Data Pairs Count
Relative Difference
<10% 10% - 20% > 20%
Au 442 253 57% 49 11% 140 32%

– IIIC-104 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 8-11: Correlation Plot of Coarse Reject Replicates and Original Assays
8.3.4 Comments
Based on the verification of the data, SRK is of opinion that the QA/QC samples’ performance are of
industrial standard, which provides sufficient confidence for the mineral resource estimation.
– IIIC-105 –
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FOR THE WASSA GOLD MINE


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9 Mineral Processing and Metallurgical Testing
9.1 Metallurgical Test works of 2003
Metallurgical Process Development Pty Ltd. (now known as MDM) c arried out the Process
Engineering aspect of the feasib ility study (“FS”) for a CIL co mmissioned by GSR  when the latter
took ownership of the Project in 2002. The FS was completed in 2003. The metallurgical test work
was conducted on samples from the Wassa area. Samples were originally sent to SGS Lakefield in
Johannesburg for both variabilit y and bulk sample test work. Fu rther variability test work was
conducted at AMMTEC in Perth.
A total of 24 variability samples were tested: 10 of fresh mineralised material, six of oxide, and eight
samples taken from the decommissioned and reclaimed Heap Leach operation (“HL”). Four bulk
samples were also tested, representing fresh, oxide, HL phase 1 and HL phase 2. All these samples
were taken from the Wassa Main area.
The test work also quantified the metallurgical grindability, gravity recovery and leachability that could
be attained within the milling circuit. The Bond Ball Mill Work Index (“BWi”) for the fresh bulk sample
was 14.8 kWh/t. That sample achieved a leach recovery of 92% on a grind size of 75% passing 75
μm when leached over a 24-hour period. However, the reported va lues for the BWi and leach
recovery are 8 kWh/t and 93% respectively under same conditions. The potential plant gravity circuit
recoveries ranged between 30 to 40% and an indicative minor pre g-robbing behaviour was also
noted.
These were reported as per NI 43-101 Technical Report on A Feas ibility Study of the Wassa Open
Pit Mine and Underground Project in Ghana (SRK, 2014) and NI 43-101 Technical Report on the
Wassa Gold Mine - Mineral Resource & Mineral Reserve Update and  Preliminary Economic
Assessment of the Southern Extension Zone (GSR, 2021).
9.2 Metallurgical Testwork of 2015
Further metallurgical test work was completed in 2015 as part o f the Wassa Underground FS. This
test work was undertaken by SGS (Cornwall, UK) and the samples were delivered and logged in the
middle of December 2014 with this initial phase of test work completed and the draft report issued in
early April 2015.
The scope of the test work covered evaluation of the performance of feed from underground with a
series of half-core samples f rom definition drilling. The physi cal characteristics and metallurgical
response of these samples were compared to those of a reference  sample of the then plant feed
(i.e., open pit material).
A representative of the underground feed material was obtained from the exploration decline and
bulk sample from underground. The bulk sample treatment through  the plant resulted in a reduced
test work program that included a series of six variability and  four crushability samples that were
compared to a reference sample taken from the open pit ore feed.
– IIIC-106 –
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FOR THE WASSA GOLD MINE


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9.2.1 Variability, Crushability and Reference Sample
GSR differentiated spatially the material envisaged to be proce ssed into six underground domains
or zones for processing. Six variability samples were selected, one for each zone from available HQ
and NQ half cores. These are depicted in Figure 9-1 with further details presented in Table 9-1.
Table 9-1: Ore Zones Represented by the Variability Samples

Figure 9-1: Locations of 2015 Metallurgical Samples (GSR, 2015)

These core sections were further cut in half, with one section used for the metallurgical test work and
the remaining quarter core sections retained for reference. Eac h sample of quarter core, weighed
between 50 and 60 kg.
Four full core samples were selected for the crushability tests  since samples with a minimum of 35
mm in two dimensions are required. As a result, quarter core sa mples were not suitable for such
investigations due to the limited physical size of each sample. Each crushability sample consisted of
seven lengths of HQ drill core e ach approximately 200 mm in length. Three of these samples were
prepared for the uniaxial compressive strength (“UCS”) tests wi th the remaining core sections and
material from UCS testing prepared for the Bond crushability index (low energy crushing) tests.
– IIIC-107 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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The reference sample used was obtained from the workings in the Starter open pit area at around
the 910 m level by hand selection. Around 100 kg of material was taken, and this sample was used
for both metallurgical and crush ability test work. Some of the crushability samples selected were
adjacent to rather than completely within the representative or e zone. The full description of each
sample is given in Table 9-2.
Table 9-2: Summary of Location of 2015 Testwork Samples

9.2.2 Programme of Metallurgical Test works
The following constituted the requisite metallurgical tests performed:
 Scope of work for reference and variability samples:
– elemental scan: ICP multi-element analysis;
– analysis of sulphide and total sulphur;
– analysis of carbonate and graphitic carbon;
– Bond Ball Mill Work Index; and
– Bond Abrasion Index (Ai).
 diagnostic leach (gold deportment tests);
 Scope of work for crushability and reference samples:
– UCS;
– Bond Low Impact Crushing Work Index (CWi);
– BWi; and
– Ai.
 Standard flowsheet treatment tests – to confirm recoveries and reagent consumptions:
– grind calibration tests;
– IIIC-108 –
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– gravity concentration;
– cyanide leaching of the gravity tails with pre-aeration; and
– settling tests.
9.2.3 Findings of Metallurgical Test works
Head Grade and Analyses
Milled head samples were screened over an aperture of 106 μm. The gold and silver contents of the
two fractions were determined using fire assay and the values are stated in Table 9-3.
Table 9-3: Head Grades of Screened Samples

In all cases, the gold and silver content in the coarse fractio n (+106 μm) is higher than those in the
finer fraction (-106 μm).
Elemental analyses were carried out using an Inductively Coupled Plasma (ICP) spectroscopy. Total
carbon, organic carbon, total sulphur and sulphide sulphur cont ents of the reference and variability
samples were determined using the Lecco Furnace method. The results are indicated in Table 9-4.
– IIIC-109 –
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FOR THE WASSA GOLD MINE


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Table 9-4: Elemental and Chemical Analyses

In all cases, a higher-grade variability sample registered high er contents of sulphide sulphur, iron
and base metals compared to the reference sample, although the levels for the base metals were
relatively lower values.
The low levels of graphitic carbon measured in all the samples is indicative of the minimal preg-
robbing potential.
Diagnostic Leach
Diagnostic leaching is a method for determination and distribut ion of gold among the minerals. It is
commonly utilised because of its simplicity, speed and relative ly low cost. It consists of a series of
cyanidation steps in between a series of progressively more aggressive acid-digestion steps. Thus,
it apportions a gold assay into water-soluble, cyanidable-expos ed gold, and gold enclosed in
carbonates, in sulphides and in silicates.
However, diagnostic leaching is also carried out, ensuring that  the various leach stages are carried
out correctly and the results analysed properly.
The aim for this testwork was to determine whether the increase d level of sulphide minerals was
resulting in the samples being more refractory to treatment for the recovery of gold.
Each of the samples was prepared by grinding 75% passing 75 μm and was subjected to the
following steps:
 Step 1. Cyanidation to determine the amount of free and exposed gold.
 Step 2. Leach with hydrochloric acid to define gold bound to ca rbonates, pyrrhotite, galena,
goethite and other iron hydroxide minerals
– IIIC-110 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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 Step 3. Leach with sulphuric acid to determine amount of gold a ssociated with uraninite,
sphalerite, labile copper sulphates, labile base metal sulphides, and labile pyrite.
 Step 4. Leach with nitric acid to determine amount of gold asso ciated with pyrite, arsenopyrite
and marcasite.
 Step 5. Carbon combustion to burn off any organic carbon releas ing gold previously adsorbed
by the carbon and therefore not amenable to recovery by direct cyanidation.
Steps 2 to 5 constitute separate pre-treatment stages and resid ual gold and silver present after the
above tests represent gold encapsulated in silica and other non-reactive gangue minerals inherently
present in the sample.
Table 9-5 shows a summary of results of the diagnostic leaching  tests for gold and the deportment
of gold in the samples.
Table 9-5: Summary of Gold Deportment Using Diagnostic Leaching

The mineralogy and metallurgy of the samples when compared to the reference sample, appear to
have potentially more occluded gold or associated with differen t sulphide minerals and others less.
Low levels of preg-robbing potential are indicated from the gol d liberated in the burn off stage. Two
samples (Z3U and Z3L) showed potentially higher levels of gold encapsulated in pyrite while sample
Z2L showed higher levels of gold potentially associated with mo re reactive minerals such as
pyrrhotite as seen in the graphical display of same data in Figure 9-2.
– IIIC-111 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 9-2: Gold Deportment in Samples Using Diagnostic Leaching
It should be noted that due to assay detection limits some of t he lower deportments may be
marginally inaccurate. Given a detection limit of 0.01 g/t Au, measurements below this level were
assigned a nominal assay of 0.005 g/t Au; hence on the lower levels the deportment in these fractions
could be possibly overstated.
It was reported that during the hydrochloric acid digestion, a reasonably vigorous reaction took place
on the majority of the variability samples with the generation of green foam. This would tend to
indicate a high level of carbonate and acid soluble iron, possibly pyrrhotite.
Crushability
Metallurgical operations in size reduction including both crushing and grinding are determined by the
feed characteristics of the ore into the circuit. Key parameter s needed are the “crushability or
grindability”, also called Work Index (Wi) and the “Wear Profile” or Ai.
Crushability is the ease of crushing a sample under standard conditions. Various testing procedures
may be used to measure crushab ility. The low energy crushing wo rk index laboratory test is
conducted on ore specimens larger than 50 mm, determining the CWi or impact work index (IWi).
The uniaxial UCS and the Bond CWi tests were undertaken to dete rmine the material strength and
crushability of a material. In the UCS test, a sample is prepared by cutting to pre-set dimensions (re-
coring) and then subjected to a compressive load to measure the strength at which the sample fails.
The Bond CWi test involves two swinging weighted pendulums which are allowed to fall and impact
simultaneously on the sample in order to measure from what heig ht the pendulum needs to fall to
crush the sample.
– IIIC-112 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Both tests (UCS and CWi) were undertaken on multiple individual  samples notably three prepared
samples in the case of the UCS tests and about 20 sample pieces for the Bond CWi test. The results
of the tests are presented in Table 9-6.
Table 9-6: Results of Crushability Tests using UCS and CWi

A relatively large variation between the maximum and minimum me asurements on the different
samples were recorded during the UCS tests. There is no correlation between the UCS results and
the depth of the sample.
The values of work indices obtained are indications of the efficiencies of the machines. The general
trend of samples UCS values to be within the 30 to 95 MPa range, indicating that the materials tested
were medium strong to strong. One sample (Crushability 3) recorded a very strong measurement of
around 240 MPa. The mineralogy of that sample appears to be con sisting of quartzite (massive
quartz vein), rather than schist which had been associated with  the majority of the other samples
tested.
The CWi test results show the samples to be in the easy to medium classification. Similar to the UCS
results, the CWi test results are also relatively variable with  the reference sample (910 m RL). No
real correlation can be seen between the CWi results and relative level of the sample tested as shown
in Figure 9-3.
– IIIC-113 –
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Figure 9-3: Scatter Diagram of the UCS and CWi Results with Relative Levels of Samples
Thus, the ores having the highest indices are the largest energy consumers followed by intermediate
and the smallest consumers. The smallest consumers of energy ar e those machines that apply a
steady, continuous, compressive stress on the material to crush them.
Ball Mill Work Index and Abrasion Index
The most widely used parameter to measure ore hardness is the Bond BWi. The abrasion index is a
measure of the anticipated wear on components and consumables in the comminution circuit and is
applicable to wear in both crushers and mills (media and liners).
Calculations involving BWi are generally divided into steps with a different Wi determination for each
size class.
The rate of production in a mill, shell liner and lifter design  and simulation are dependent among
other parameters on the grindability in the ball mills.
The BWi tests were undertaken at a closing screen size of 106 μ m to give a mill product of around
75-80% < 75 μm. The BWi values for the primary and oxide ores w ere reported to be in the region
of 14.6 and 8 kWh/t respectively in the FS of 2003.
The findings of the BWi and Ai investigations from the 2015 tests are presented in Table 9-7 and are
shown as a function of the average sample depth in Figure 9-4 and Figure 9-5, respectively.
– IIIC-114 –
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Table 9-7: Bond Work Indices and Abrasion Indices from the 2015 Testwork

From the 2015 testwork, fresh open pit ore feeding the two ball  mills were expected to draw power
between 14.5 and 16.5 kWh/t treated. This results in a calculat ed BWi of around 14 – 16 kWh/t,
based on the reported mill feed and product sizes and power dra w on the ball mills. An allowance
was made in the calculations for mechanical and other losses between the drive motor and mill.
The experimental data of the samples does not support the suspe cted increasing BWi with further
depth with the reference sample (910 m RL) showing the highest BWi reading.
Figure 9-4: Plot of 2015 Ball Mill Bond Work Index Against Sample Depth

– IIIC-115 –
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FOR THE WASSA GOLD MINE


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Figure 9-5: Plot of 2015 Abrasion Index Against Sample Depth

Ai has generally shown not to be increasing with depth and it appears Ai is slightly lower on deeper
samples. With the exception of one sample (MET 5) of massive qu artz vein, measured Ai for the
reference sample is higher than all the other samples tested. T his lower indicated abrasion index
with depth may result in the reduced consumption of grinding media and mill crusher liners as mining
proceeds deeper into the underground areas. All the samples fall into the slightly abrasive
classification.
The Ai determined values are utilised in modelling and simulation of plants designed.
Gravity Gold and Leaching Tests
Each 1 kg representative sample from each zone or category with  a grind of 75% passing 75 μm
passes through a Falcon centrifugal concentrator for gravity separation of any free gold. Each batch
of concentrate from the Falcon was further processed on a Mozle y shaking table, with the final
concentrate weighed and sent for assay. Tailings from the centrifugal concentrator and shaking table
were subjected to cyanide leach testing.
Table 9-8 shows the results of the gravity tests.
– IIIC-116 –
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FOR THE WASSA GOLD MINE


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Table 9-8: Gravity Gold Recovery Test Results

The results of the gravity recoveries were lower than in previous reports however the recovery from
the reference sample is generally higher than on the variability samples.
In all the tests, a strong rare earth magnet was able to separa te the magnetic components of the
slurry but not for iron magnet. This magnetic component was sus pected by SGS to be pyrrhotite
(SRK, 2021). The claim was attributed to the sulphur to iron ratios measured in the feed analyses.
Carbon-in-Leach Tests
These sets of CIL tests were undertaken to investigate the effective leaching conditions and reagent
consumption is determined for each sample. Concurrently, any preg-robbing effect is also evaluated
for each sample. A comparative assessment is designed with leach test undertaken on the reference
sample with and without carbon as well.
The results obtained from the experiments are indicated in Table 9-9.
Table 9-9: Summary of CIL Results
Item
Solution (24h/48h) Solid Tails Gold on Carbon Overall
Recovery
Back Calc.
Head Grade
Au g/t Ag g/t Au g/t Ag g/t Au g/t Ag g/t Au % Ag % Au g/t Ag g/t
Leach Test 1.13 0.08 0.105 0.05 - - - - 1.55 0.15
Distribution 93.2% 67.0% 6.8% 33.0% - - 93.2% 67.0% - -
CIL Test 0.14 0.01 0.1 0.05 93.4 12.7 - - 1.21 0.19
Distribution 14.3% 6.5% 8.3% 26.4% 77.4% 67.1% 91.7% 73.6% - -
Preg-robbing effect was not deducible during the leaching of th e sample since the difference in
recoveries of gold with and without carbon in the slurry is not  significant. This is impacted by the
situation with a higher gold recovery for the Carbon-in-Pulp (“CIP”) at 93.2% compared to the 91.7%
for CIL. However, the gold reconciliation showed a significant difference for the case of head grades
for CIL (Table 13-9 refers) and screened head grade (Table 13-3  refers) with values of 1.55 g/t Au
and 1.53 g/t Au respectively. The worst reconciliation case was for the back-calculated value of 1.21
g/t Au for same sample under CIL (Table 13-9 refers).
– IIIC-117 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Gravity Gold and Leaching Tests
The combined gravity tails from the centrifugal concentrator an d concentrate cleaning table were
subjected to cyanide leaching using the BLEG protocol.
Based on the potential presence of pyrrhotite in the gravity ta ils samples, the pH had to be pro-
condition to values between pH 10.5 - 11 using lime and aerated until the pH and dissolved oxygen
levels stabilized generally in line with the plant practice of injecting oxygen into the transfer line from
milling to CIL. Pyrrhotite is highly reactive and can result in high consumptions of oxygen and cyanide
in leach if not preconditioned.
Leach tests were conducted for up to 48 hours with samples taken at 2, 4, 6, 24 and 48h and analysed
for gold and silver in solution. An initial cyanide level of 1 g/l was used and cyanide levels in solution
were maintained at >0.5 g/l by dosing additional cyanide as required. The tails solids were analysed
for silver and gold. No lead nitrate was added in this leach tests.
A summary of the test results is shown in Table 9-10.
Table 9-10: Gold Recoveries from Samples, Cyanide and Lime Consumption Rates

It could be observed that the extended leaching period had thre e samples (Z1U, Z3U and Z3L)
showing slightly decreased recoveries. Nonetheless, for the oth er 4 samples, the extra 24 hours of
leaching time did not result in any significant improvement in their recoveries. The lowered recoveries
could be attributed to analytical error or discrepancy. It could also arise from a desorption activity or
process. Should the latter arise on the field, the gold would b e re-adsorbed by the activated carbon
present in the CIL circuit.
However, the cyanide consumption rates were markedly higher for the extended leaching.
A plot of the data in Figure 13-5 reveals that the rates and kinetics of leaching each of the samples
were consistent and close with the exception of the reference s ample after 24 hours of leaching.
Nevertheless, the final recovery after 48 hours was consistent for all the samples.
– IIIC-118 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 12-6: Leaching Curves

Overall Gravity / Leach Recoveries
Comments on the gravity/ CIL testwork results are as follows:
 Gravity recoverable gold content ranges from 15% to 26% with an average of 20%.
 Overall recovery ranged from 90% to the highest at 96% whilst the average 93%.
The corresponding recoveries as determined from the sample routes are shown in Table 9-11.
Table 9-11: Recoveries of Gold from Samples via Gravity-Leach Routes

It can be seen that Z1L recoveries were outliers compared to similar trends for all the other samples
except for the reference sample. It rather compared very well with the reference sample. There was
also a strong positive correlation between gravity and leach recoveries without Z1L sample. Similarly,
positive strong correlations wer e seen between the leaching and  overall recoveries. These
observations could lead to the conclusion that the overall reco veries were extremely dependent on
the recoveries obtained during leaching. The extended leach period to 48 hours alone did not appear
– IIIC-119 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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to have a significant impact on the overall recoveries and ther efore such factors would have to be
subjected to further assessment to make a direct implication to that effect.
It was observed that there appeared to be discrepancies in the head grade based on the fire assay
methodology and the back-calculated approach as shown in Table 9-12.
A better correlation between the diagnostic and the gravity lea ch test grades however could be
observed.
Table 9-12: Reconciliation of Assay and Back-Calculated Head Grades

Settling Tests
Anionic flocculants have very wide application in the mining industry. A single variability sample was
chosen and tested along the reference sample to determine the s ettleability of these materials.
Nasaco anion flocculants N2132 and N2326 were used for the test s following the earlier trials with
five different flocculants. The test results are presented in Table 9-13.
Table 9-13: Comparative Settling Tests using Anionic Flocculants NZ2132 and NZ2326

Normal dosage rates for these applications are in the range 2.5-50 g/t.
The results show very similar settling performance on the refer ence samples and the sample with
the generation of a thickened slurry from about 10% solids in the feed compared to about 59% solids
content which is in the region required for good cyanide leachi ng without the carbon settling to the
bottom of the CIL tanks.
– IIIC-120 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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9.3 Metallurgical Testwork of 2018
In August 2018, GSR commissioned another metallurgical study to profile the mining zones so as to
develop a plant operations strategy. University of Mines and Technology, Tarkwa in Ghana
undertook the geometallurgical characterisation of each of seve n samples submitted by GSR. The
scope of the study covered:
 Head assays
 BWi
 Gravity recoverable gold
 Effects of particle size on cyanidation
 Consumption of reagents such as cyanide, lime and lead nitrate; and
 Diagnostic leaching.
The head assays of the samples ranged from 3.91 g/t to 5.25 g/t whilst Bond BWi’s ranged from 13.6
kWh/t to 15.7 kWh/t. Five samples (constituting 71%) were class ified as hard rocks because their
BWi were above 14 kWh/t whilst two other samples were classifie d to be of medium hardness. The
details are shown in Table 9-14.
Table 9-14: Summary of Bond Ball Work Indices

Most often cyclone underflow material moving for gravity concen tration may be of size -1 mm
however this may not be the liberation size. The results of gravity studies done at 40% passing 106
μm is presented in Table 9-15.
– IIIC-121 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Table 9-15: Gravity Gold Recovery at different P80s

The concentrate grades were from 50 g/t to 120 g/t with gravity  concentration at particle size 40%
passing 106 μm generated gold recoveries in the range of 26% to 44% with an average recovery of
32%. The study clearly substantiated that CIL performance was s uperior to direct cyanidation.
However, gold extraction by leaching was very sensitive to grind size. At 40%, 60% and 80% passing
106 μm the recoveries were 76%, 84.2% and 89.2% respectively.
All the samples had a basic paste pH within the range of 9.1 and 9.6. The calcium oxide consumption
was 0.8 kg/t and cyanide consumption ranged between 0.13 and 0. 19 kg/t. These consumption
values were deemed moderate.
The overall recoveries based on gravity gold and cyanidation at 80% passing 106 μm, were between
90% and 96% as shown in Table 9-16.
Table 9-16: Metal Accounting

Diagnostic leaching of these samples revealed that the residual gold was distributed in all the other
minerals with sulphides generally having higher gold values of up to 6.3%. Gold extraction in the first
stage ranged between 85% and 94%.
– IIIC-122 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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10 Mineral Resource Estimates
10.1 Introduction
The Mineral Resource Statement presented herein represents a Mi neral Resource evaluation
prepared for the Wassa Main (B Shoot UG and 242 UG) deposit and the satellite deposits Dead
Man’s Hill (DMH), Benso’s I Zone, Hwini Butre and Chichiwelli. The Mineral Resource Statement is
presented in accordance with the JORC Code guidelines. SRK has reviewed, but not re-modelled or
re-estimated the Mineral Resources and the mineral resource models were prepared by GSR.
At Wassa B Shoot deposit, GSR provided SRK with borehole database, structural control lines, grade
wireframes, variogram models, resource classification footprint s and block models. Mineralised
wireframes were created by the Indicator radius basis function (RBF) Interpolant in Leapfrog™
software and the estimation technique was Ordinary Kriging (OK).
At Wassa 242 deposit, GSR provided SRK with borehole database, grade wireframes, variogram
models, resource classification footprints and block models. Mineralised wireframes were created by
the semi-explicit method in Leapfrog™ software and the estimation technique was OK.
At DMH deposit, SRK was provided with topographic surface, database, mineralised wireframe, and
block models. The mineralisation domains were modelled using the intrusive technique in Leapfrog™
software and the estimation technique was OK.
At Benso, four estimation domains, Subriso East (including C Zo ne), Subriso West, G Zone and I
Zone, were modelled. OP mining finished for Subriso East (including C Zone), Subriso West , G Zone
and I Zone Pit. For I Zone Pit, GSR provided topographic surface, database, composites, mineralised
wireframe, and a grade control model. The wireframes were created using Leapfrog™ software vein
modelling technique and the estimation technique was OK.
At Hwini Butre, two estimation models, Father Brown (FB) and Ad oikrom (ADK), were modelled. A
drilling program was initiated at  FB/ADK during 2022-2023, and 10,287.4m of drilling has been
completed. But the additional drilling information has not been included in this resource estimate. For
Chichiwelli, there has been no exploration or mining activity s ince 2020. Therefore, the Mineral
Resources for FB/ADK and Chichiweilli remain unchanged from the  previous NI 43-101 Technical
Report (March 2021). The descriptions for Hwini Butre and Chichiwelli are thus based on the NI 43-
101 Technical Report (March 2021).
The effective date of the current Mineral Resource Statement is 30 September 2024.
This section describes the Mineral Resource estimation methodol ogy and summarizes the key
parameters and assumptions considered by GSR. In the opinion of  SRK, the Mineral Resource
evaluation reported herein is a reasonable representation of the global gold Mineral Resources found
in the Wassa project at the current level of sampling. The Mineral Resources estimates are reported
in accordance with the JORC Code. Mineral Resources are not Ore  Reserves and there is no
certainty that all or any part of the Mineral Resource will be converted into Ore Reserve. It should be
noted that the Mineral Resources reported in this Report are inclusive of, not in addition to, the Ore
Reserves.
– IIIC-123 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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The database used to estimate the Mineral Resources was audited  by SRK. SRK is of the opinion
that the current drilling information is sufficiently reliable to interpret with confidence the boundaries
for gold mineralisation and that the assay data are sufficiently reliable to support Mineral Resource
estimation.
SRK has reviewed the databases, wireframes, grade estimation parameters, resource classification
footprints and reported the Mineral Resource.
10.2 Resource Estimation Procedures
The Mineral Resources review and validation methodology involved the following procedures:
 Database verification
 Review of the definition of resource domains
 Data conditioning (compositing and capping) for data analysis
 Grade estimation review
 Mineral Resource classification review and model validation
 Assessment of “reasonable prospects for eventual economic extraction” (RPEEE) and selection
of appropriate cut-off grades
 Preparation of the Mineral Resource Statement
10.3 Resource Database
10.3.1 Zone B Shoot
The database SRK received consist of assay, collar, density, li thological and weathering logs, and
downhole survey data. They were loaded into Surpac software for the following validations:
 Checks for holes without samples
 Checks for duplicate samples
 Checks and adjusts the missing or wrong intervals
Only DD and RC holes were included in the grade estimate.
Figure 10-1 shows the locations of the DD and RC holes and Tabl e 10-1 summaries the database
statistics.

– IIIC-124 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 10-1: DD and RC Holes Plane Projection Map of Zone B Shoot

Source: Arcgis Mapping by SRK
Table 10-1: Mineral Resource Database Statistics of B Shoot
Location Type Holes Drill Meters (m) Assay Samples
Zone B Shoot
DD 3,755 731,162.9 559,927
RC 485 50,314.9 37,484
Total 4,240 781,477.8 597,411

10.3.2 Zone 242
The database SRK received consist of assay, collar, density, li thological and weathering logs, and
downhole survey data. They were loaded into Surpac for the following validations:
– IIIC-125 –
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 Checks for holes without samples
 Checks for duplicate samples
 Checks and adjusts the missing or wrong intervals
DD, RC and grade control RC (GCRC) holes were included in the grade estimate. Figure 10-2 shows
the locations of the DD, RC and GCRC holes and Table 10-2 summaries the database statistics.
Figure 10-2: DD, RC and GCRC Holes Plane Projection Map of Zone 242

Source: Arcgis Mapping by SRK

Table 10-2: Mineral Resource Database Statistics of Zone 242
Location Type Holes Drill Meters((m)) Assay Samples
Zone 242
DD 190 42,023.4 18,794
RC 79 8,773.0 8,020
GCRC 4,332 92,859.0 83,430
– IIIC-126 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Location Type Holes Drill Meters((m)) Assay Samples
Total 4,601 143,655.4 110,244
10.3.3 DMH
The database provided to SRK cont ain assay, collar, lithologica l logs, weathering, structure and
downhole survey data. They were loaded into Surpac software for the following validations:
 Checks for holes without samples
 Checks for duplicate samples
 Checks and adjusts the missing or wrong intervals
DD, RC and grade control RC (GC-RC) holes were included in the grade estimate. Figure 10-3 shows
the locations of the holes. Table 10-3 summaries the database.
Figure 10-3: DD, RC and GC-RC Holes Plane Projection Map of DMH

Source: Arcgis Mapping by SRK

– IIIC-127 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Table 10-3: Mineral Resource Database Statistics of DMH
Location Type Holes Drill Meters((m)) Assay Samples
DMH
DD 32 4453.8 2,678
RC 205 15,618.4 7,195
GC-RC 1,900 52,967.0 30,034
Total 2,137 73,039.2 39,907
10.3.4 I Zone
The database (hbb_database.accdb) consists of assay, collar, lithological and weathering logs, and
downhole survey data, covering the areas of Benso, Hwini Butre, and so on. SRK extracted the data
used for I Zone and reconstructed the database. They were loaded into Surpac software for
validation, which included:
 Checks for holes without samples
 Checks for duplicate samples
 Checks and adjusts the missing or wrong intervals
DD, RC and GCRC holes were included in the grade estimate. Table 10-4 summaries the database
statistics and Figure 10-4 shows the locations of the DD and (GC) RC holes.
Table 10-4: Mineral Resource Database Statistics of I Zone
Location Type Holes Drill M eters(m) Assay Samples
I Zone
DD 21 2,245.4 1,192
RC 42 4,114.7 4,878
GCRC 191 9,214.0 4,594
Total 254 15,574.1 10,664

– IIIC-128 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 10-4: DD, RC and GCRC Holes Plan Projection Map of I Zone

Source: Arcgis Mapping by SRK
10.3.5 Hwini Butre
The database used in 2020-year-end Mineral Resource estimate is made up of DD, RC and GCRC
holes, as summarized in Table 10-5 and Figure 10-5.
Table 10-5: Mineral Resource Database Statistics of Father Brown/Adoikrom
Location Type Holes Drill Meters((m))
Father Brown/Adoikrom
DD 435 66,229
RC 214 16,323
GCRC 3,087 72,037
Total 3,736 154,589
Source: NI 43-101 Technical Report on the Wassa Gold Mine, GSR, 2021

– IIIC-129 –
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FOR THE WASSA GOLD MINE


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Figure 10-5: DD, RC and GCRC Holes Plan Projection Map of Father Brown/Adoikrom
Source: Arcgis Mapping by SRK
GSR has performed validation to the database and in SRK’s opinion the database is appropriate for
the Mineral Resource estimate.
10.3.6 Chichiwelli
The database used in 2020-year-end Mineral Resource estimate is  made up of DD and RC holes,
as summarised in Table 10-6. No exploration has taken place at Chichiwelli since 2012, the database
has no changes.
Table 10-6: Mineral Resource Database Statistics of Chichiwelli
Location Type Holes Drill Meters((m))
Chichiwelli
DD 23 3,692
RC 483 29,802
– IIIC-130 –
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Location Type Holes Drill Meters((m))
Total 506 33,494
Source: NI 43-101 Technical Report on the Wassa Gold Mine, GSR, 2021
GSR has performed validation to the database and in SRK’s opinion the database is appropriate for
the Mineral Resource estimate.
Figure 10-6: DD and RC Holes Plan Projection Map of Chichiwelli
Source: Arcgis Mapping by SRK
10.4 Solid Body Modelling
10.4.1 Zone B Shoot
For the model “wug_bm_eng_20240409.mdl”, the wireframe modelling was carried out by GSR using
Leapfrog™ software. The mineralisation wireframes are constrain ed within two mineralisation
envelopes (Halo and Mineralised). A Halo zone at 0.4g/t cut-off at an ISO value of 0.35 have a hard
boundary with each other modelle d based on Leapfrog™ implicit m odelling technique. The
mineralisation zone was modelled at 1.20 g/t, with domains for (3101 & 4101) modelled with
– IIIC-131 –
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Leapfrog™ Vein option whilst the other lodes were based on implicit modelling approach with same
parameters as the Halo zone.  The structural trend surfaces used for grade shell modelling are shown
in Figure 10-7.
Figure 10-7: Structural Trend Surfaces Used for Wassa Grade Shell Modelling

Source: SRK, Leapfrog Mapping Using the Surfaces Provided by GSR
Prior to generating the indicator RBF interpolant shells, the r aw assay file was composited to 2 m,
with a minimum end composite length of 1 m. Any composite less than the end composite length of
1 m was added to previous interval for HG domain but discarded for LG domain. Indicator interpolants
were defined at 0.4 g/t Au and 1.2 g/t Au threshold.
Table 10-7: B Shoot Grade Shell Modelling Parameters
Domain Interpolant
Type Range Nugget Iso
Value Resolution Volumes
Excluded
LG (Halo) Spheroidal 200 0.5 0.35 3.5 m /
HG (Mineralised) Spheroidal 200 0.3 0.35 2.5 m 10,000 m 3
GSR used different zones to classify mineralised domains, detai led in Figure 10-8. All mineralised
domains were shown in Figure 10-9 and detailed in Table 10-8.
– IIIC-132 –
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FOR THE WASSA GOLD MINE


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Figure 10-8: Estimation Zones Used to Classify Mineralised Domains

Source: GSR

Table 10-8: Descriptions for Zone B Shoot Mineralised Domains
Domain Code Description
2001 F Shoot Halo Domain
2101 F Shoot Mineralised Domain
3001 B Shoot South Halo Domain
3101 B Shoot South Mineralised Domain
4001 Southwest Zone Halo Domain
4101 Southwest Zone Mineralised Domain
5001 B Shoot Halo Domain
5101 B Shoot Mineralised Domain
– IIIC-133 –
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Domain Code Description
6001 HW Zone Halo Domain
6101 HW Zone Mineralised Domain
7001 Link Zone Halo Domain
7101 Link Zone Mineralised Domain
8001 All Other South Zone Halo Domain
8101 All Other South Zone Mineralised Domain
10001 All Other North Zone Halo Domain
10101 All Other North Zone Mineralised Domain

Figure 10-9: All Mineralised Domains for Zone B Shoot
Source: SRK, Leapfrog Mapping Using the Solids Provided by GSR
SRK has reviewed the grade shells, displayed in Figure 10-9 and believes that they are reasonable
and can be used for a Mineral Resource estimation.
– IIIC-134 –
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10.4.2 Zone 242
For the model “242_bm _gc_231019.mdl”, the wireframe modelling w as carried out by GSR using
Leapfrog™ software. The mineralised domains are constrained wit hin two envelopes (Halo and
Mineralised) using semi explicit  method. The Halo zone was mode lled at 0.4 g/t Au cut-off grade
based on Leapfrog™ vein modelling technique. The mineralisation zone was modelled at 1.0 g/t Au
cut-off grade, with the same method as the Halo zone.
Figure 10-10: Mineralised Domains for Zone 242

Source: SRK, Leapfrog Mapping Using the Solids Provided by GSR
The description of all mineralised domains is listed in Table 10-9 below.
Table 10-9: Descriptions for Zone 242 Mineralised Domains
Domain Code Description
1001, 1002, 1003, 1004, 1005, 1006 Halo Domain
1101, 1102, 1103, 1104, 1105, 1106 Mineralised Domain
10019, 10049 Internal Dilution Zone of Halo Domain
11019, 11039 Internal Dilution Zone of Mineralised Domain
SRK has reviewed the grade shells, displayed in Figure 10-10, and believes that they are reasonable
and can be used for a Mineral Resource estimation.
– IIIC-135 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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10.4.3 DMH
For the model “dmh_gc_model_20240518.mdl”, the mineralisation domains were modelled using the
intrusive technique in Leapfrog™ software by GSR. The Halo domains, 1001, 1002, 1003, 1004, and
1005, were modelled with an Au cut-off grade of 0.4 g/t. The mineralised domain 2102 was generated
with a cut-off of 1.0 g/t. A total of 12 structural trends was developed to guide the intrusive implicit
modelling, as shown in Figure 10-11.
Figure 10-11: Structural Surfaces Used in Mineralised Domain Modelling for DMH Pit

Source: SRK, Leapfrog Mapping Using the Surfaces Provided by GSR

– IIIC-136 –
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Figure 10-12: Mineralised Domains for DMH Pit

Source: SRK, Leapfrog Mapping Using the Solids Provided by GSR
SRK has reviewed the solid models as shown in Figure 10-12 and believes that they are reasonable
and can be used for the Mineral Resource estimation.
10.4.4 I Zone
For the model “izone_bm_res_20230901.mdl”, mineralised domains were developed using
Leapfrog™ vein modelling technique by GSR. The intervals used i n the veins modelling were
generated by Leapfrog™ implicit modelling technique, at 0.5 g/t gold cut-off at an ISO value of 0.35
have a hard boundary.
Prior to generating the indicator RBF interpolant shells, the r aw assay file was composited to 2 m,
with a minimum end composite length of 0.5 m. Any composite les s than the end composite length
of 0.5 m was discarded. Indicator interpolants were defined at 0.5 g/t gold threshold. The global trend
dips to 270° with a dip angle of 50°.
Table 10-10: I Zone Pit Grade Shell Modelling Parameters
Domain Interpolant
Type Range Nugget Iso Value Resolution Volumes
Excluded
I Zone Spheroidal 100 0.2 0.35 5 m /
SRK reviewed the solid models (1001, 1002, 1003, 1004, 1005, 10 06, 1007,1008,2001,2002,2003
and 2004, Figure 10-13) and is of the opinion that they are reasonable and can be used for Mineral
Resource estimation.
– IIIC-137 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Mineral Resource Estimates    Final
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Figure 10-13: Solid Models for I Zone

Source: SRK, Leapfrog Mapping Using the Solids Provided by GSR
10.4.5 Hwini Butre
The solid models for Father Brown (FBZ) and Adoikrom (ADK) were created by GSR and Resource
Modelling Solutions (RMS). They were modelled using a vein mode lling technique, with estimating
both vein thickness and grade.
GSR provided RMS with drill hole intercepts with hanging wall ( HW), main mineralised zone (ADK
or FBZ) (HG) and footwall (FW) ‘from’ and ‘to’ intervals.
Each vein unit is created by estimating the position of the vein and each one of the thicknesses, HW,
HG and FW. The position of the vein is defined by the intercept with the top of HW unit, the first
thickness is the difference between the intercept of the contact between HW and HG with the top of
– IIIC-138 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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HW, the second thickness is defined by the difference between t he contact HW and HG and the
contact between HG and FW and the third thickness is defined by the base of the FW contact.
Intercepts within a horizontal distance tolerance of 2.0 m are used to calculate position and
thicknesses to check any possible relationship between these va riables and determine whether
independent modelling is adequate for the modelling of each vei n unit. The scatterplots between
each variable showed no significant correlation between the var iables, therefore, the independent
modelling of each one of these variables in a stepwise manner is deemed appropriate.
The final vein model is defined by stacking the modelled thicknesses below the vein position model.
A cross section at U = -28.0 m in transformed space is shown in  Figure 10-14. Note that these
sections are shown in transformed coordinates, after gold estim ations models were rotated back to
the original Easting-Northing-Elevation coordinates.
Figure 10-14: Model section at U=-28.0 in Transformed Space Generated with 2.0 Tolerance
in V Direction

Source: A Report to Golden Star Father Brown Resource Model, RMS, 2020
10.4.6 Chichiwelli
Mineralisation solids were undertaken by GSR, and the mineralised zone modelling was conducted
by GSR with the 2D polylines being snapped to drill hole grade intercepts using a cut-off grade of
0.5 g/t Au. The 2D polylines were then linked together to create a 3D mesh for grade estimation. The
modelled wireframe solids are shown in Figure 10-15.
The mineralisation zones of Chichiwelli are structurally controlled with gold emplacement related to
the density of quartz veining and sulphide content. The mineral isation hosting structures generally
trend north-south and dip moderate-steeply to the east at 60°.
– IIIC-139 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1665 ---
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Figure 10-15: Solid Models for Chichiwelli

Source: Surpac Mapping, SRK
SRK has reviewed the solid models and is of the opinion that they are reasonable and can be used
for a Mineral Resource estimation.
10.5 Compositing
Prior to the statistical analysis, the samples were generally c ombined so the length of each sample
was basically equivalent.
10.5.1 Zone B Shoot
The average distribution was generally around 1 m and raw sampl e assay data was composited to
2 m intervals by GSR in Leapfrog™ (Figure 10-16). The 2 m interval composite was applied by GSR
for subsequent statistic, geostatistical analysis, and grade interpolation.
SRK summarised statistics of composites against raw samples for  each domain as listed in Table
10-11.
– IIIC-140 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1666 ---
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Mineral Resource Estimates    Final
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Figure 10-16: Histogram of Interval Length for Zone B Shoot

Source: SRK, Leapfrog Mapping Using the Data Provided by GSR

Table 10-11: Summary Statistics of Composites against Raw Samples for Zone B Shoot
 Count Min Max Mean Variance Std Dev CoV
Raw 630,884 0.005 1,547.97 0.73 15.36 3.92 5.38
Composite 387,782 0.05 314. 05 0.73 9.37 3.06 4.18
Based on the above results, SRK notes that there is a good corr espondence in the basic statistics
between the raw assay dataset and composites.
10.5.2 Zone 242
The average distribution was generally around 1 m and raw sampl e assay data was composited to
2 m intervals by GSR in Leapfrog™ software (Figure 10-17). The 2 m interval composite was applied
by GSR for subsequent statistic, geostatistical analysis, and grade interpolation.
SRK summarised statistics of composites against raw samples for  each domain as listed in Table
10-12.
– IIIC-141 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1667 ---
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Mineral Resource Estimates    Final
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Figure 10-17: Histogram of Interval Length for Zone 242

Source: SRK, Leapfrog Mapping Using the Data Provided by GSR

Table 10-12: Summary Statistics of Composites against Raw Samples for Zone 242
Domain Type Count Min Max Mean Variance Std Dev CoV
1001 Raw 1,918 0.005 28.46 0.82 2.16 1.47 1.54
Composite 1,143 0.005 28. 46 0.82 1.59 1.26 1.54
1002 Raw 130 0.03 5.89 0.72 0.55 0.74 1.03
Composite 79 0.04 3.46 0.72 0.26 0.51 0.70
1003 Raw 27 0.01 1.72 0.46 0.19 0.43 0.92
Composite 16 0.035 1.16 0.46 0.14 0.37 0.82
1004 Raw 286 0.01 7.95 0.83 1.18 1.09 1.32
Composite 167 0.04 5.78 0.82 0.67 0.82 1.00
1005 Raw 85 0.01 62.3 1.47 44.84 6.70 4.56
Composite 49 0.01 3.15 0.76 0.45 0.67 0.89
1006 Raw 14 0.05 1.1 0.49 0.08 0.28 0.58
Composite 9 0.29 0.82 0.49 0.02 0.15 0.31
1101 Raw 2,248 0.005 193.6 4.00 74.28 8.62 2.16
Composite 1,362 0.015 98. 34 4.01 45.65 6.76 1.69
1102 Raw 120 0.03 30.15 3.23 17.17 4.14 1.28
Composite 68 0.32 14.18 3.23 8.17 2.86 0.88
1103 Raw 25 0.03 13.55 3.32 10.78 3.28 0.99
Composite 17 0.71 7.54 3.32 5.08 2.25 0.68
1104 Raw 286 0.05 122 3.19 73.43 8.57 2.69
Composite 151 0.15 68.14 3.23 42.69 6.53 2.02
1105 Raw 111 0.03 80.00 3.28 62.61 7.91 2.41
Composite 60 0.615 42.52 3.28 33.79 5.81 1.77
1106 Raw 19 0.28 11.30 4.20 11.94 3.46 0.82
Composite 14 0.56 8.54 4.20 7.48 2.74 0.65
10019 Raw 76 0.10 0.82 0.18 0.03 0.17 0.99
Composite 43 0.025 0.525 0.15 0.01 0.11 0.73
– IIIC-142 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Domain Type Count Min Max Mean Variance Std Dev CoV
10049 Raw 7 0.02 0.59 0.12 0.05 0.22 1.73
Composite 4 0.023 0.37 0.12 0.03 0.16 1.32
11019 Raw 260 0.005 11.34 0.44 0.86 0.93 2.09
Composite 149 0.02 5.69 0.44 0.36 0.60 1.37
11039 Raw 15 0.05 4.27 1.06 1.56 1.25 1.17
Composite 9 0.16 2.73 1.02 1.18 1.08 1.07
Based on the above results, SRK notes that there is a good corr espondence in the basic statistics
between the raw assay dataset and composites.
10.5.3 DMH
The average distribution for DMH was generally around 2 m and r aw sample assay data was
composited to 2 m intervals by GSR in Leapfrog™ software (Figur e 10-18). The 2 m interval
composite was applied by GSR for subsequent statistic, geostati stical analysis, and grade
interpolation.
SRK summarised statistics of composites against raw samples for  each domain as listed in Table
10-13.
Figure 10-18: Histogram of Interval Length for DMH
Source: SRK, Leapfrog Mapping Using the Data Provided by GSR

– IIIC-143 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1669 ---
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Mineral Resource Estimates    Final
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Table 10-13: Summary Statistics of Composites against Raw Samples for DMH
 Count Min Max Mean Variance Std Dev CoV
Raw 43,597 0.005 44.34 0.39 0.95 0.98 2.53
Composite 39,965 0.005 39. 78 0.39 0.84 0.92 2.36
Based on the above results, SRK notes that there is a good corr espondence in the basic statistics
between the raw assay dataset and composites.
10.5.4 I Zone
The average distribution for I Zone was generally around 2 m and raw sample assay data was
composited to 2 m intervals by GSR in Leapfrog™ software (Figur e 10-19). The 2 m interval
composite was applied by GSR for subsequent statistic, geostati stical analysis, and grade
interpolation.
SRK summarised statistics of composites against raw samples for  each domain as listed in Table
10-14.
Figure 10-19: Histogram of Interval Length for I Zone

Source: SRK, Leapfrog Mapping Using the Data Provided by GSR

Table 10-14: Summary Statistics of Composites against Raw Samples for I Zone
 Count Min Max Mean Variance Std Dev CoV
Raw 44,135 0.005 357.12 0. 62 19.98 4.47 7.18
Composite 25,958 0.005 166. 00 0.53 4.26 2.06 3.91
– IIIC-144 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1670 ---
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Based on the above results, SRK notes that there is a good corr espondence in the basic statistics
between the raw assay dataset and composites.
10.5.5 Chichiwelli
Assay data was composited to 2 m by GSR. The 2 m composites were applied for grade
estimation, statistic, and model validation.
10.6 Evaluation of Outliers
10.6.1 Zone B Shoot
SRK has reviewed the sample outliers used for the grade estimat ion by GSR. Outliers of pre
mineralised domain were determined  using Leapfrog statistical t ool by GSR. The coefficient of
variation (CV), histograms, prob ability plots and cumulative me tal plots were analysed carefully to
select the appropriate top cuts for all domains. The CV variations of different capping grade for each
domain are listed in Figure 10-20.
Figure 10-20: CV Variations of Different Capping Grade for Each Domain (B Shoot)

– IIIC-145 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1671 ---
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Figure 10-20: CV Variations of Different Capping Grade for Each Domain (B Shoot)
– IIIC-146 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 10-20: CV Variations of Different Capping Grade for Each Domain (B Shoot)
Source: GSR

Table 10-15: Zone B Shoot Au Grade Capping
Domain Code Capped Mean before Capped Mean after Capped Differe nce (%)
2001 10.0 0.78 0.75 -3
2101 31.6 3.04 2.99 -1
3001 14.6 0.78 0.76 -3
3101 29.3 3.82 3.62 -5
4001 9.4 0.76 0.72 -7
4101 30.4 3.74 3.50 -6
5001 20.5 0.83 0.79 -4
5101 50.2 4.40 4.22 -4
6001 9.5 0.84 0.79 -6
6101 30.01 3.40 3.35 -1
7001 8.7 0.80 0.76 -5
7101 25.5 3.80 3.70 -3
8001 18.4 0.92 0.91 -1
8101 33.7 3.47 3.35 -3
10001 15.1 0.99 0.96 -3
10101 27.6 3.16 3.09 -2
– IIIC-147 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1673 ---
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In SRK’s opinion, the grade capping is appropriate.
10.6.2 Zone 242
SRK has reviewed the sample outliers used in grade estimation by GSR. Outliers of pre mineralised
domain were determined using statistical method by GSR. The CV variations of different capping
grade for each domain are listed in Figure 10-21.
Figure 10-21: CV Variations of Different Capping Grade for Each Domain (242)
– IIIC-148 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 10-21: CV Variations of Different Capping Grade for Each Domain (242)
– IIIC-149 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 10-21: CV Variations of Different Capping Grade for Each Domain (242)
Source: GSR

Table 10-16: Zone 242 Grade Capping
Domain Code Capped Mean before Capped Mean after Capped Differe nce (%)
1001 10 0.81 0.79 -3
1002 1.16 0.71 0.65 -8
1003 0.87 0.49 0.46 -7
1004 2 0.80 0.71 -11
1005 1.1 1.92 0.60 -69
1006 0.6 0.49 0.46 -5
1101 30 3.88 3.66 -6
1102 9 3.18 3.06 -4
1103 6 3.17 3.02 -5
1104 17 3.08 2.67 -13
1105 7 3.23 2.53 -22
1106 6 4.03 3.60 -11
10019 0.75 0.20 0.20 0
10049 0.065 0.12 0.05 -62
11019 0.7 0.44 0.36 -16
11039 0.94 1.07 0.54 -50
In SRK’s opinion, the grade capping is appropriate.
10.6.3 DMH
SRK has reviewed the sample outliers used in grade estimation by GSR. Outliers of pre mineralised
domain were determined using statistical method by GSR. The CV variations of different capping
grade for each domain are listed in Figure 10-22.
– IIIC-150 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 10-22: CV Variations of Different Capping Grade for Each Domain (DMH)
Source: GSR

Table 10-17: DMH Grade Capping
Domain Code Capped Mean before Capped Mean after Capped Differe nce (%)
1001 8.91 1.30 1.27 -2
1002 4.4 0.71 0.70 -1
1003 6.05 1.10 1.09 -1
1004 10.44 1.08 1.07 -2
1005 10 1.08 1.06 -2
– IIIC-151 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Domain Code Capped Mean before Capped Mean after Capped Differe nce (%)
2102 11.44 2.07 2.05 -1
In SRK’s opinion, the grade capping is appropriate.
10.6.4 I Zone
SRK has reviewed the sample outliers used in grade estimation by GSR. Outliers of pre mineralised
domain were determined using Excel statistics by GSR. The CV variations of different capping grade
for each domain are listed in Figure 10-23.
Figure 10-23: CV Variations of Different Capping Grade for Each Domain (I Zone)
– IIIC-152 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 10-23: CV Variations of Different Capping Grade for Each Domain (I Zone)
Source: GSR
SRK noticed a big mean difference of Domain 1004, 1005, 1006, 1007 and 1008. The reason was
that each domain has a small amount of samples but has a very high grade of gold.
Table 10-18: I Zone Grade Capping
Domain Code Capped Mean before Capped Mean after Capped Differe nce (%)
1001 2.64 1.04 1.00 -4
1002 3.01 1.21 1.16 -4
1003 15 2.38 2.35 -1
1004 2 2.07 1.39 -33
– IIIC-153 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1679 ---
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Mineral Resource Estimates    Final
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Domain Code Capped Mean before Capped Mean after Capped Differe nce (%)
1005 4.4 2.09 1.57 -25
1006 2.75 1.35 0.83 -16
1007 2 1.26 1.08 -14
1008 1.43 1.55 1.2 -22
2001 10 1.05 1.01 -4
2002 3.64 1.34 1.20 -10
2003 2.88 1.00 0.93 -7
2004 4 1.77 1.6 -10
In SRK’s opinion, the grade capping is appropriate.
10.6.5 Hwini Butre
Probability plots for each vein unit for each domain are genera ted and shown in Figure 10-24. The
capping values selected from the probability plots are summarized in Table 10-19.
Figure 10-24: Au Grade Probability Plot with Outliers and Far Out Thresholds Highlighted
Source: A Report to Golden Star Father Brown Resource Model, RMS, 2020

Table 10-19: Capping Values Selected from Analysis of the Probability Plot
Deposit Vein
Unit
Capped Values
Used
Mean Grade
before Cap
Mean Grade
after Cap
Percentage
Difference
FBZ FW 5 1.02 0.74 -27.45
FBZ HG 46 11.41 9.28 -18.67
FBZ HW 5 0.81 0.60 -25.93
ADK FW 5 1.19 0.95 -20.17
– IIIC-154 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Mineral Resource Estimates    Final
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Deposit Vein
Unit
Capped Values
Used
Mean Grade
before Cap
Mean Grade
after Cap
Percentage
Difference
ADK HG 23 7.58 5.90 -22.16
ADK HW 5 1.31 1.03 -21.37
Source: A Report to Golden Star Father Brown Resource Model, RMS, 2020
10.6.6 Chichiwelli
The caps were determined based on the shape of the tail of the log histogram and the log probability
plots. Details are listed in Table 10-20. In SRK’s opinion, the capping is appropriate.
Table 10-20: Chichiwelli Au Grade Capping
Domain
Cap Applied Mean Grade before Cap Mean Grade after
Cap
Percentage
difference
g/t g/t g/t %
East 25 1.75 1.65 -6.06
West 15 1.69 1.59 -6.29
Source: NI 43-101 Technical Report on the Wassa Gold Mine, GSR, 2021
10.7 Statistical Analysis and Variography
10.7.1 Zone B Shoot
The variogram models for each mineralised domain were developed  by GSR for grade estimation.
Domain 5101 and 8101 variogram models are shown in  Figure 10-2 5 and Figure 10-26. The
variogram models are listed in Table 10-21.
Table 10-21: Variogram Structure of Au for B Shoot Domain 5101 and 8101
Domain  Nom.Sill Type Major Semi-Major Minor
5101
Nugget 0.38
Structure 1 0.55 Spherical 5.259 4.357 4.266
Structure 2 0.07 Spherical 30.21 25.2 18.36
8101
Nugget 0.28
Structure 1 0.43 Spherical 15.9 6.39 3.49
Structure 2 0.29 Spherical 31.09 27.36 8.45

– IIIC-155 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1681 ---
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Figure 10-25: Variogram Model of Au for Domain 5101

Source: SRK, Leapfrog Mapping Using the Data Provided by GSR

Figure 10-26: Variogram Model of Au for Domain 8101

Source: SRK, Leapfrog Mapping Using the Data Provided by GSR

– IIIC-156 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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10.7.2 Zone 242
The variogram models for each mineralised domain were developed  by GSR using Leapfrog™
software. Domain 1001 and 1101 variogram models are shown in Fi gure 10-27 and Figure 10-28.
The variogram models are listed in Table 10-22.
Table 10-22: Variogram Structure of Au for 242 Domain 1001 and 1101
Domain  Nom.Sill Type Major Semi-Major Minor
1001
Nugget 0.40
Structure 1 0.44 Spherical 11.42 11.77 2.89
Structure 2 0.16 Spherical 73.89 62.81 5.0
1101
Nugget 0.40
Structure 1 0.38 Spherical 11.32 5.62 2.89
Structure 2 0.22 Spherical 51.84 26.01 5.0

Figure 10-27: Variogram Model of Au for Domain 1001
Source: SRK, Leapfrog Mapping Using the Data Provided by GSR

– IIIC-157 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1683 ---
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Mineral Resource Estimates    Final
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Figure 10-28: Variogram Model of Au for Domain 1101
Source: SRK, Leapfrog Mapping Using the Data Provided by GSR
10.7.3 DMH
The variogram models for each mineralised domain were developed  by GSR using Leapfrog™
software. Domain 1001 and 2102 variogram models are shown in Fi gure 10-29 and Figure 10-30.
The variogram models are listed in Table 10-23.
Table 10-23: Variogram Structure of Au for DMH Domain 1001 and 2102
Domain  Nom.Sill Type Major Semi-Major Minor
1001
Nugget 0.39
Structure 1 0.38 Spherical 7.96 7.27 3.57
Structure 2 0.23 Spherical 19.32 17.22 5.39
2102
Nugget 0.37
Structure 1 0.26 Spherical 7.47 7.43 4.86
Structure 2 0.37 Spherical 26.1 17.12 11.37

– IIIC-158 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1684 ---
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Mineral Resource Estimates    Final
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Figure 10-29: Variogram Model of Au for Domain 1001
Source: SRK, Leapfrog Mapping Using the Data Provided by GSR

Figure 10-30: Variogram Model of Au for Domain 2102
Source: SRK, Leapfrog Mapping Using the Data Provided by GSR
– IIIC-159 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Mineral Resource Estimates    Final
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10.7.4 I Zone
The variogram models n were developed by GSR using Leapfrog™ software. Domain 1003 and 2001
variogram models are shown in Figure 10-31 and Figure 10-32. The variogram models are listed in
Table 10-24.
Table 10-24: Variogram Structure of Au for I Zone Domain 1003 and 2001
Domain  Nom.Sill Type Major Semi-Major Minor
1003
Nugget 0.40
Structure 1 0.06 Spherical 6.70 5.25 5.66
Structure 2 0.54 Spherical 20.26 16.55 6.72
2001
Nugget 0.42
Structure 1 0.39 Spherical 11.69 6.72 5.66
Structure 2 0.19 Spherical 20.48 10.48 9.22

Figure 10-31: Variogram Model of Au for Domain 1003
Source: SRK, Leapfrog Mapping Using the Data Provided by GSR

– IIIC-160 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1686 ---
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Mineral Resource Estimates    Final
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Figure 10-32: Variogram Model of Au for Domain 2001
Source: SRK, Leapfrog Mapping Using the Data Provided by GSR
10.7.5 Hwini Butre
The variography was performed for each deposit and for each vein unit (FBZ and ADK) with capped
values. Experimental semi variograms were calculated for full range of possible azimuths with steps
of 15 degrees totalling 24 directions. The direction with most continuous experimental points from
visual inspection of the 24 directions were utilised for nugget  inference. These directions may not
coincide with the final major continuity direction when conside ring all experimental points for final
model fit. The nugget was inferred by fitting a single structure spherical variogram to the first few (up
to three) experimental semi variogram points.
The variogram nugget inference for all veins in FBZ are shown in Figure 10-33. The directions used
for nugget inference are detailed in each plot in Figure 10-33.
Figure 10-33: Inferred Nugget Effect for Au in Each Vein for FBZ

Source: A Report to Golden Star Father Brown Resource Model, RMS, 2020
– IIIC-161 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1687 ---
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The experimental semi variogram and fitted model for FW unit in FBZ is shown in Figure 10-34. The
parameters of the fitted model are summarised in Table 10-25. T he experimental semi variogram
and fitted model for HG unit in FBZ is shown in Figure 10-35. The parameters of the fitted model are
summarised in Table 10-26. The experimental semi variogram and fitted model for HW unit in FBZ
is shown in Figure 10-36. The parameters of the fitted model are summarised in Table 10-27.
Figure 10-34: Fitted Experimental semi variogram Points for Au in FW for FBZ

Source: A Report to Golden Star Father Brown Resource Model, RMS, 2020

– IIIC-162 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1688 ---
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Mineral Resource Estimates    Final
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Figure 10-35: Fitted Experimental semi variogram Points for Au in HG for FBZ

Source: A Report to Golden Star Father Brown Resource Model, RMS, 2020

– IIIC-163 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1689 ---
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Mineral Resource Estimates    Final
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Figure 10-36: Fitted Experimental semi variogram Points for Au in HW for FBZ

Source: A Report to Golden Star Father Brown Resource Model, RMS, 2020

Table 10-25: Fitted Variogram Parameters for Au in FW for FBZ
Item Nugget Structure1 Structure2
Contribution 0.000 0.851 0.149
Model Shape  Exponential Exponential
Angle1  43.3 43.3
Angle2  0.0 0.0
– IIIC-164 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1690 ---
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Mineral Resource Estimates    Final
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Item Nugget Structure1 Structure2
Angle3  0.0 0.0
Range1  10.0 155.9
Range2  16.3 10.0
Range3  1.0 1.0
Source: A Report to Golden Star Father Brown Resource Model, RMS, 2020
Table 10-26: Fitted Variogram Parameters for Au in HG for FBZ
 Nugget Structure1 Structure2
Contribution 0.250 0.416 0.334
Model Shape  Exponential Exponential
Angle1  29.1 29.1
Angle2  0.0 0.0
Angle3  0.0 0.0
Range1  10.0 77.3
Range2  10.0 50.0
Range3  1.0 1.0
Source: A Report to Golden Star Father Brown Resource Model, RMS, 2020
Table 10-27: Fitted Variogram Parameters for Au in HW for FBZ
 Nugget Structure1
Contribution 0.283 0.717
Model Shape  Exponential
Angle1  72.6
Angle2  0.0
Angle3  0.0
Range1  10.0
Range2  10.0
Range3  1.0
Source: A Report to Golden Star Father Brown Resource Model, RMS, 2020
The variogram nugget inference for all veins in ADK are shown in Figure 10-37. The directions used
for nugget inference are detailed in each plot in Figure 10-37.
Figure 10-37: Inferred Nugget Effect for Au in Each Vein for ADK
Source: A Report to Golden Star Father Brown Resource Model, RMS, 2020

– IIIC-165 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1691 ---
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Mineral Resource Estimates    Final
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The experimental semi variogram and fitted model for FW unit in ADK is shown in Figure 10-38. The
parameters of the fitted model are summarised in Table 10-28. T he experimental semi variogram
and fitted model for HG unit in ADK is shown in Figure 10-39. The parameters of the fitted model are
summarised in Table 10-29. The experimental semi variogram and fitted model for HW unit in ADK
is shown in Figure 10-40. The parameters of the fitted model are summarised in Table 10-30.
Figure 10-38: Fitted Experimental Semi Variogram Points for Au in FW for ADK

Source: A Report to Golden Star Father Brown Resource Model, RMS, 2020

– IIIC-166 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1692 ---
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Mineral Resource Estimates    Final
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Figure 10-39: Fitted Experimental Semi Variogram Points for Au in HG for ADK

Source: A Report to Golden Star Father Brown Resource Model, RMS, 2020

– IIIC-167 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1693 ---
Independent Competent Person’s Report for Wassa Gold Mine, Akyempim, Western Region, Ghana
Mineral Resource Estimates    Final
SRK CONSULTING (CHINA) LTD.   28 FEBRUARY 2025  PX/AT - 149 -
Figure 10-40: Fitted Experimental Semi Variogram Points for Au in HW for ADK

Source: A Report to Golden Star Father Brown Resource Model, RMS, 2020

Table 10-28: Fitted Variogram Parameters for Au in FW for ADK
 Nugget Structure1 Structure2
Contribution 0.000 0.062 0.938
Model Shape  Exponential Exponential
Angle1  77.8 77.8
Angle2  0.0 0.0
Angle3  0.0 0.0
– IIIC-168 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1694 ---
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Mineral Resource Estimates    Final
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 Nugget Structure1 Structure2
Range1  15.0 15.0
Range2  929.5 15.0
Range3  1.0 1.0
Source: A Report to Golden Star Father Brown Resource Model, RMS, 2020
Table 10-29: Fitted Variogram Parameters for Au in HG for ADK
 Nugget Structure1 Structure2
Contribution 0.097 0.460 0.443
Model Shape  Exponential Exponential
Angle1  13.1 13.1
Angle2  0.0 0.0
Angle3  0.0 0.0
Range1  32.8 21.9
Range2  38.9 10.0
Range3  1.0 1.0
Source: A Report to Golden Star Father Brown Resource Model, RMS, 2020
Table 10-30: Fitted Variogram Parameters for Au in HW for ADK
 Nugget Structure1 Structure2
Contribution 0.000 0.650 0.350
Model Shape  Exponential Exponential
Angle1  73.1 73.1
Angle2  0.0 0.0
Angle3  0.0 0.0
Range1  15.0 58.4
Range2  15.0 99.9
Range3  1.0 1.0
Source: A Report to Golden Star Father Brown Resource Model, RMS, 2020
The major direction of continuity for each variogram model for each deposit is inferred from the
weighted ranges of each  variogram structure utilising their con tribution as weights. The major
direction is rotated back to original space and the results are summarised in Table 10-31.
Table 10-31: Fitted Major Variogram Directions in Original Space
Deposit Vein Azimuth Dip Weighted Anisotropy
FBZ FW 118.9 26.5 2.1
FBZ HG 131.6 18.5 1.4
FBZ HW 86.9 38.5 1.0
ADK FW 172.9 10.9 4.8
ADK HG 4.1 11.7 1.1
ADK HW 170.7 15.1 1.5
Source: A Report to Golden Star Father Brown Resource Model, RMS, 2020
– IIIC-169 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1695 ---
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Mineral Resource Estimates    Final
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10.7.6 Chichiwelli
Variograms were modelled for the East and West domains separate ly. The experimental semi
variogram in real space is poorly structured, and so a Gaussian  transformation was applied to the
data. The first stage was to define the nugget effect from a short-lag omnidirectional variogram, which
was calculated along the drillhole, and then modelled the vario gram ranges from directional
variograms from along strike, down-dip and across dip direction s. The directional variograms were
then back transformed into “real” space and used for subsequent estimation. The back transformed
variograms and resultant variogram parameters are as shown in Table 10-32.
Table 10-32: Variogram Parameters for Chichiwelli
Parameter East West
C0 7.94 3.06
C1 3.60 1.59
Nugget Effect (%) 68.8 65.81
Range (m)
a1 (strike) 25 4
a1 (dip) 25 35
a1 (normal to strike) 5 4.7
Source: NI 43-101 Technical Report on the Wassa Gold Mine, GSR, 2021
10.8 Block Model and Grade Estimation
10.8.1 Zone B Shoot
For the model “wug_bm_eng_20240409.mdl”, the block size of 5 m easting (X) by 10 m northing (Y)
by 5 m elevation (Z) was used. A summary of the block model specifications is listed in Table 10-33.
The attribute and description of the block model are presented in Table 10-34.
Table 10-33: Specifications of Zone B Shoot Block Model
 Min Max Block Size Sub Block Size Rotation
N 18,200 21,050 10 2.5 0
E 39,275 40,575 5 1.25 0
Z -975 1,100 5 2.5 0
Total Blocks 9,735,066
Table 10-34: Attribute and Description of Zone B Shoot Block Model
Attribute Description
au_ok Au grade.
density Density.
domain All Mineralised Domains.
resclass 1=Measured, 2=Indicated, 3=Inferred.
For Zone B Shoot UG, the bulk density in the model was set to 2.8 g/cm3 (fresh rock) as before.
– IIIC-170 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1696 ---
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Mineral Resource Estimates    Final
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The OK method was used for grade estimation by GSR. As shown in  Figure 10-7, variable search
orientations were developed for each mineralised domain. The parameters are summarised in Table
10-35.
Table 10-35: Grade Estimation Parameters Used in Zone B Shoot
Pass Major Semi-Major Minor Min Samples Max Samples Max Samples  Per Hole
1 25 25 10 3 8 2
2 50 50 20 2 12 4
3 150 150 50 1 15
A classed post plot of the gold estimate is as shown in Figure 10-41.
Figure 10-41: Au Grade for Zone B Shoot

Source: SRK, Leapfrog Mapping Using the Data Provided by GSR
10.8.2 Zone 242
For the model “242_bm_gc_231019.mdl”, the block size of 5 m eas ting (X) by 10 m northing (Y) by
5 m elevation (Z) was used. A summary of the block model specif ications is listed in Table 10-36.
The attribute and description of the block model are presented in Table 10-37.
Table 10-36: Specifications of Zone 242 Block Model
 Min Max Block Size Sub Block Size Rotation
N 20,179 20,709 10 2.5 50
– IIIC-171 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1697 ---
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 Min Max Block Size Sub Block Size Rotation
E 39,198 39,768 5 1.25 50
Z 740 1,090 5 2.5 0
Total Blocks 240,654
Table 10-37: Attribute and Description of Zone 242 Block Model
Attribute Description
au_ok Au grade.
density Density.
domain All Mineralised Domains.
res_class 1=Measured, 2=Indicated, 3=Inferred.
For 242 UG, the bulk density in the model was set to 2.8 (fresh rock).
The OK method was used for grade estimation by GSR. Variable search orientations were developed
for each mineralised domain. The parameters are summarised in Table 10-38.
Table 10-38: Grade Estimation Parameters Used in Zone 242
Pass Major Semi-Major Minor Min Samples Max Samples Max Samples  Per Hole
1 40 30 2.5 3 12 2
2 70 60 5 2 12 4
3 150 100 50 1 15
A classed post plot of the gold estimate is as shown in Figure 10-42.
Figure 10-42: Au Grade for Zone 242
– IIIC-172 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1698 ---
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Mineral Resource Estimates    Final
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Source: SRK, Leapfrog Mapping Using the Data Provided by GSR
10.8.3 DMH
For the model “dmh_gc_model_20240518.mdl”, the block size of 5 m easting (X) by 5 m northing (Y)
by 3 m elevation (Z) was used. A summary of the block model specifications is listed in Table 10-39.
The attribute and description of the block model are presented in Table 10-40.
Table 10-39: Specifications of DMH Block Model
 Min Max Block Size Sub Block Size Rotation
N 20,705 21,210 5 1.25 0
E 40,500 41,110 5 1.25 0
Z 724 1,132 3 1.5 0
Total Blocks 1,175,800
Table 10-40: Attribute and Description of DMH Model
Attribute Description
Au_ok Gold grade.
density Density.
est_domains All Mineralised Domains.
weathering 1=Fresh, 2=Trans, 3=Oxide.
res_class 1=Measured, 2=Indicated, 3=Inferred, 4=Bluesky
The density values for the tonnage estimation were coded to 1.8  g/cm3 for oxide, 2.25 g/cm 3 for
transition and 2.7 g/cm3 for fresh by GSR.  The OK method was used for grade estimation by GSR.
Variable search orientations were developed for each mineralised domain. Parameters are listed in
Table 10-41.
Table 10-41: Grade Estimation Parameters Used in DMH
Pass Major Semi-Major Minor Min Samples Max Samples Max Samples  Per Hole
1 10 5 5 9 15 3
2 15 9 9 9 15 3
3 22.5 13.5 13.5 6 12 3
4 45 27 27 6 10
5 90 54 54 4 8
A classed post plot of the Au estimate is as shown in Figure 10-43.
– IIIC-173 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Mineral Resource Estimates    Final
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Figure 10-43: Au Grade for DMH

Source: SRK, Leapfrog Mapping Using the Data Provided by GSR
10.8.4 I Zone
For the model “zone_bm_res_20230901.mdl “, the block size of 10  m easting (X) by 20 m northing
(Y) by 6 m elevation (Z) was used. A summary of the block model specifications is listed in Table
10-42. The attribute and description of the block model are presented in Table 10-43.
Table 10-42: Specifications of I Zone Block Model
 Min Max Block Size Bub Block Size Rotation
N 57,180 57,740 20 2.5 0
E 174,470 174,880 10 1.25 0
Z 764 1,100 6 1.5 0
Total Blocks 199,693
Table 10-43: Attribute and Description of I Zone Model
Attribute Description
au_ok Gold grade.
density Density.
domain All mineralised domains.
– IIIC-174 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Attribute Description
oxidation 1=Fresh, 2=Trans, 3=Oxide.
res_class 1=Measured, 2=Indicated, 3=Inferred.
The density values for the tonnage estimation were coded to 1.8  g/cm3 for oxide, 2.25 g/cm 3 for
transition and 2.7 g/cm3 for fresh by GSR. The OK method was used for grade estimation by GSR.
Variable search orientations were developed for each mineralised domain. Parameters are listed in
Table 10-44.
Table 10-44: Estimation and Search Parameters for I Zone
Pass Major Semi-Major Minor Min Samples Max Samples Max Samples  Per Hole
1 25 15 10 4 16 2
2 50 30 20 3 12
3 100 60 40 2 10
4 200 120 80 1 8
A classed post plot of the gold estimate is as shown in Figure 10-44.
Figure 10-44: Au Grade for I Zone

Source: SRK, Leapfrog Mapping Using the Data Provided by GSR
10.8.5 Hwini Butre
Two block models were created; one for FBZ and the other for ADK. No rotation was applied to the
models. Block sizes were chosen to reflect the geometry of the deposits. Grade data for each of the
modelled units was interpolated into the individual structures only. Block model parameters for FBZ
and ADK are shown in Table 10-45 and Table 10-46.
– IIIC-175 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Table 10-45: FBZ Block Model Parameters
Coordinate Origin Boundary Size Block Size (m)
X 175,681.47 1,443 1
Y 32,345.73 683 2
Z 1,176.72 482 2
Source: A Report to Golden Star Father Brown Resource Model, RMS, 2020
Table 10-46: ADK Block Model Parameters
Coordinate Origin Boundary Size Block Size (m)
X 175,731.38 718 1
Y 32,394.43 804 2
Z 1271.61 721 2
Source: A Report to Golden Star Father Brown Resource Model, RMS, 2020
The density used for estimation was provided by GSR with the value of 2.7 g/cm3.
The estimation was performed using OK with uncapped and capped gold grades. The number of
composites and maximum search radius utilized for each vein uni t in each deposit are shown in
Table 10-47.
Table 10-47: Kriging Search Parameters for Each Vein in Each Deposit
Deposit Vein Max Search (m) Max Composites
FBZ FW 250 8
FBZ HG 500 4
FBZ HW 500 4
ADK FW 250 4
ADK HG 1,000 24
ADK HW 1,000 2
Source: A Report to Golden Star Father Brown Resource Model, RMS, 2020
10.8.6 Chichiwelli
A block model was created by GSR for the whole Chichiwelli area. Block sizes were chosen to reflect
the average spacing of drill li nes along the strike. Grade data  for each of the modelled units was
interpolated into the individual structures only, with soft bou ndaries between oxidation states, and
subsequently reported as oxide or fresh. Block model parameters for Chichiwelli are summarized in
Table 10-48.
Table 10-48: Chichiwelli Block Model Parameters
Coordinate Origin Block Size (m) No. of Blocks
X 631,093.64 12.5 100
Y 580,787.20 25 60
Z 1216(Max) 8 65
Source: NI 43-101 Technical Report on the Wassa Gold Mine, GSR, 2021
– IIIC-176 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Mineral Resource Estimates    Final
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GSR modelled the oxidation surface to determine the boundary be tween oxide and fresh material.
No transition zone was modelled. The density values used for the estimation were provided by GSR
with the values of 1.8 g/cm3 for oxide and 2.68 g/cm3 for fresh.
Block grades for each of the mineralised zones were estimated using OK. OK was carried out in four
passes for each mineralised zone, and the search parameters for  the individual domains shown
below in Table 10-49. Octants were used on the 1st and 2nd pass  searches with three consecutive
empty sectors; however, they were not applied on the 3rd search  pass, hence the same number of
minimum and maximum samples for the 2nd and 3rd searches.
Table 10-49: Chichiwelli Estimation Parameters
Domain  Pass1 Pass2 Pass3 Rotation
East
X 60 120 120 Azimuth 20
Y 60 120 120 Dip 60
Z 20 40 4
Min Samples 3 3 3
Max Samples 80 80 80
West
X 80 160 120 Azimuth 20
Y 80 160 120 Dip 60
Z 10 20 20
Min Samples 3 3 3
Max Samples 80 80 80
Source: NI 43-101 Technical Report on the Wassa Gold Mine, GSR, 2021
10.9 Model Validation and Sensitivity
Model validation is a common approach for determining whether grade estimation has performed as
expected. An acceptable or preferred validation result does not necessarily imply that the model is
correct or derived from the right estimation approach. It suggests only that the model is a reasonable
representation of the Mineral Resource data used and of the estimation method applied. Other issues
such as the relationship between the model-selective assumptions and mining practices are equally
important when determining the appropriateness of the Mineral Resource estimate.
SRK adopted the swath plot validation approaches to validate the model for B Shoot, 242, DMH and
I Zone.
Swath plots of gold were created in three orthogonal directions (easting, northing, and vertical, as X,
Y, and Z) in particular slice thicknesses in each direction to validate the resultant block models.
– IIIC-177 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1703 ---
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Figure 10-45: Au Swath Plot for Domain 5101 of B Shoot

Source: SRK, Leapfrog Mapping Using the Data Provided by GSR

Figure 10-46: Au Swath Plot for Domain 8101 of B Shoot
– IIIC-178 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1704 ---
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Mineral Resource Estimates    Final
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Figure 10-46: Au Swath Plot for Domain 8101 of B Shoot

Source: SRK, Leapfrog Mapping Using the Data Provided by GSR

Table 10-50: Comparison of Composites and Block Model (B Shoot)
Domain Code Mean Grade (Composites) Mean Grade (Block Model) Di fference
2001 0.73 0.72 -1.13%
2101 3.14 2.65 -15.79%
3001 0.94 0.88 -6.18%
3101 3.68 3.84 4.39%
4001 0.77 0.77 0.64%
4101 3.68 3.65 -0.85%
5001 0.82 0.81 -1.27%
5101 4.35 3.78 -13.14%
6001 0.80 0.72 -9.50%
6101 3.39 3.04 -10.34%
7001 0.84 0.73 -12.69%
7101 3.91 3.37 -13.75%
8001 0.96 0.84 -12.92%
8101 3.52 3.37 -4.36%
10001 1.03 0.90 -12.84%
10101 3.14 2.83 -9.87%
For the model “wug_bm_eng_20240409.mdl”, as shown in Figure 10-45 and Figure 10-46, the block
models and composites match reasonably well in all orthogonal d irections. This comparison shows
close agreement between the block model and composites in terms  of overall distribution as a
function of X, Y, and Z location. The gold grade comparison of composites and global mean are listed
in Table 10-50. The estimation method and parameters are appropriate. The data indicates that the
block models constructed by GSR are reliable.
For the model “242_bm_gc_231019.mdl”, as shown in Figure 10-47 and Figure 10-48, the block
models and composites match reasonably well in all orthogonal d irections. This comparison shows
– IIIC-179 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1705 ---
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Mineral Resource Estimates    Final
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close agreement between the block model and composites in terms  of overall distribution as a
function of X, Y, and Z location. The comparison of the composites and global gold grade of the block
model are listed in Table 10-51. The estimation method and para meters are appropriate. The data
indicates that the block models constructed by GSR are reliable.
Figure 10-47: Au Swath Plot for Domain 1001 of 242

Source: SRK, Leapfrog Mapping Using the Data Provided by GSR

Figure 10-48: Au Swath Plot for Domain 1101 of 242
– IIIC-180 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 10-48: Au Swath Plot for Domain 1101 of 242

Source: SRK, Leapfrog Mapping Using the Data Provided by GSR

Table 10-51: Comparison of Composites and Block Model (242)
Domain Code Mean Grade (Composites) Mean Grade (Block Model) Di fference
1001 0.80 0.75 -5.71%
1002 0.65 0.64 -1.09%
1003 0.44 0.39 -11.43%
1004 0.72 0.67 -7.75%
1005 0.60 0.49 -18.41%
1006 0.46 0.45 -2.40%
1101 3.75 3.75 0.01%
1102 3.10 2.97 -4.30%
1103 3.11 2.88 -7.62%
1104 2.74 2.63 -4.18%
1105 2.51 2.34 -6.79%
1106 3.79 3.93 3.64%
10019 0.18 0.17 -3.82%
10049 0.05 0.05 -0.37%
11019 0.36 0.35 -2.68%
11039 0.54 0.58 6.93%
For the model “dmh_gc_model_20240518.mdl”, as shown in Figure 1 0-49 and Figure 10-50, the
block models and composites match reasonably well in all orthog onal directions. This comparison
shows close agreement between the block model and composites in terms of overall distribution as
a function of X, Y, and Z location. The comparison of the compo sites and global gold grade of the
block model are listed in Table 10-52. The estimation method and parameters are appropriate. The
data indicates that the block models constructed by GSR are reliable.
– IIIC-181 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 10-49: Au Swath Plot for Domain 1001 of DMH

Source: SRK, Leapfrog Mapping Using the Data Provided by GSR

Figure 10-50: Au Swath Plot for Domain 2101 of DMH
– IIIC-182 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Mineral Resource Estimates    Final
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Figure 10-50: Au Swath Plot for Domain 2101 of DMH

Source: SRK, Leapfrog Mapping Using the Data Provided by GSR
Table 10-52: Comparison of Composites and Block Model (DMH)
Domain Code Mean Grade (Composites) Mean Grade (Block Model) Di fference
1001 1.20 1.24 4.05%
1002 0.71 0.66 -6.86%
1003 1.06 1.00 -6.17%
1004 1.05 1.07 1.91%
1005 1.06 1.01 -4.91%
2102 1.93 1.82 -5.60%
For the I Zone model, as shown in Figure 10-51 and Figure 10-52, the block models and composites
match reasonably well in all orthogonal directions. This comparison shows close agreement between
the block model and composites in terms of overall distribution as a function of X, Y, and Z location.
The comparison of the composites and global gold grade of the block model are listed in Table 10-53.
The estimation method and parameters are appropriate. The data indicates that the block models
constructed by GSR are reliable.
Figure 10-51: Au Swath Plot for Domain 1003 of I Zone
– IIIC-183 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Mineral Resource Estimates    Final
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Figure 10-51: Au Swath Plot for Domain 1003 of I Zone

Source: SRK, Leapfrog Mapping Using the Data Provided by GSR

Figure 10-52: Au Swath Plot for Domain 2001 of I Zone

Source: SRK, Leapfrog Mapping Using the Data Provided by GSR
Table 10-53: Comparison of Composites and Block Model (I Zone)
Domain Code Mean Grade (Composites) Mean Grade (Block Model) Di fference
1001 1.01 1.01 -0.01%
1002 1.16 1.12 -3.16%
– IIIC-184 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Mineral Resource Estimates    Final
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Domain Code Mean Grade (Composites) Mean Grade (Block Model) Di fference
1003 2.35 2.28 -2.72%
1005 1.58 1.57 -0.73%
1006 1.07 0.87 -18.41%
1007 1.04 1.07 2.88%
2001 1.03 1.00 -2.34%
2002 1.19 1.23 3.48%
2003 0.92 0.92 -0.52%
2004 1.62 1.70 5.09%
For the FBA/ADK model, thickness and gold grade were both check ed. For the thickness, the
difference ranges from -6.34% to 7.67% for FBZ and ranges from 0.93% to 12.41% for ADK. The
scatterplot of measured and estimated gold grades at data locations for FBZ and ADK. The scatter
plots for both FBZ and ADK indicate good data reproduction.
For the Chichiwelli model, block model was validated by compari ng the block model mean grades
with the declustered composite mean grades and through validation slices through the block models.
The block model was also compared to the composite grades withi n defined sectional criteria in a
series of validation slices, the results of which are displayed  on graphs to check for visual
discrepancies between grades al ong the defined coordinate line.  The expected outcome of the
estimation process is to observe a relative smoothing of block model grades around the composite
values. Overall, the estimation of the Chichiwelli domains is robust and the results have been verified
to a reasonable degree of confidence. Globally, the block model average grade is relatively like that
of the declustered input data, indicating that no biases have been found.
10.10 Mineral Resource Classification
Block model quantities and grade estimates for the Wassa projec t were classified according to the
JORC Code guidelines.
Mineral Resource classification is typically a subjective concept. Industry best practices suggest that
Mineral Resource classification should consider the confidence in the geological continuity of the
mineralised structures, the quality and quantity of exploration data supporting the estimates, and the
geostatistical confidence in the tonnage and grade estimates. A ppropriate classification criteria
should aim at integrating these concepts to delineate regular a reas at similar Mineral Resource
classification.
GSR has considered the following general criteria:
 Confidence in the geological interpretation.
 Knowledge of the grade continuities gained from observations and geostatistical analyses.
 Number, spacing, and orientation of drillhole intercepts through mineralised domains.
 Quality and reliability of the raw drillhole data (i.e., sampling, assaying and surveying).
– IIIC-185 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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SRK is satisfied that the geological modelling honours the curr ent geological information and
knowledge. The location of the samples and the assay data prima rily by DD and (GC)RC are
sufficiently reliable to support the Mineral Resource evaluation.
Using the above criteria, 3D surfaces and solids were created b y GSR to delineate the respective
Mineral Resource categories.
For the B Shoot model, Mineral Resource classification was performed by wireframing the Measured
and Indicated Mineral Resources by GSR, based on drill spacing displayed on sections, which were
spaced every 15 m along northing.
For Measured Mineral Resources: as detailed in Figure 10-53, de fined in areas where the drill
intercepts were consistently no greater than 15 m apart, up dip or down dip.
Figure 10-53: B Shoot Measured Areas in both Plane and Section Map
Source: SRK, Leapfrog Mapping Using the Data Provided by GSR
For Indicated Mineral Resources:  as detailed in Figure 10-54, d efined in areas where the drill
intercepts were consistently no greater than 50 m apart.
The rest within each domain with little known information is classified as Inferred Mineral Resources,
as their reliability is not sufficient to apply meaningful econ omic and technical parameters or to
evaluate economic feasibility.
Figure 10-54: B Shoot Indicated Areas in both Plane and Section Map

Source: SRK, Leapfrog Mapping Using the Data Provided by GSR
The Mineral Resource classification is as shown in Figure 10-55.
– IIIC-186 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 10-55: B Shoot Mineral Resource Classification Distribution

Source: SRK, Leapfrog Mapping Using the Data Provided by GSR
For the 242 model, blocks in the areas with drill hole spacing not more than 15 m were classified as
Measured Mineral Resources, those with drill hole spacing not greater than 30 m were classified as
Indicated Mineral Resources and those with drill hole spacing not greater than 45 m were classified
as Inferred Mineral Resources, detail in Figure 10-56.
– IIIC-187 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Mineral Resource Estimates    Final
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Figure 10-56: 242 Mineral Resource Classification Distribution

Source: SRK, Leapfrog Mapping Using the Data Provided by GSR
For the DMH model, blocks in the areas with drill hole spacing not more than 15 m were classified
as Measured Mineral Resources, those with drill hole spacing not greater than 30 m were classified
as Indicated Mineral Resources and the rest within mineralised domains were classified as Inferred
Mineral Resources, detail in Figure 10-57.
Figure 10-57: DMH Mineral Resource Classification Distribution

Source: SRK, Leapfrog Mapping Using the Data Provided by GSR
– IIIC-188 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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For I Zone model, as shown in Figure 10-58, Measured Mineral Re source was defined by the area
with an average sample distance of 15 m. Indicated Mineral Resource was defined by the area with
a sample distance of 30 m. And the rest within the mineralised domain was defined as Inferred
Mineral Resources.
Figure 10-58: I Zone Mineral Resource Classification Distribution

Source: SRK, Leapfrog Mapping Using the Data Provided by GSR
For the FAB/ADK models, delineat ion of the Mineral Resource cat egories was based on a
combination of criteria involving drillhole spacing, geological  and confidence in mineralisation
interpretation, as well as slope of regression values from the estimation process. The classification
was modelled visually by digitizing a wireframe to define contiguous zones of confidence.
Indicated Mineral Resources were classified in the areas of Fat her Brown and Adoikrom where
drilling is sufficient to demonstrate geological and grade continuity to a reasonable level.
Inferred Mineral Resources were classified by two 3D solids tha t included the wider spaced drilling
at depth (100 to 200m spacing), shown in Figure 10-59. All othe r material outside of the 3D
mesh/ surface constraints remained unclassified.
– IIIC-189 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 10-59: Mineral Resource Classification Distribution For FBZ/ADK

Source: NI 43-101 Technical Report on the Wassa Gold Mine, GSR, 2021
For Chichiwelli, delineation of the Mineral Resource categories was based on a combination criteria
drillhole spacing, geological and wireframe confidence, and was  modelled visually by digitizing a
wireframe.
Wireframes were digitized for East Domain and West Domain, with  the areas inside the modelled
solids considered to be Indicated Mineral Resources, and outside, Inferred Mineral Resources.
10.11 Mineral Resource Statement
The JORC Code defines a Mineral Resource as:
“a concentration or occurrence of material of solid material of economic interest in or on the Earth’s
crust in such form, grade (or quality) and quantity that there are reasonable prospects for eventual
economic extraction. The location, quantity, grade  (or quality), continuity and other geological
characteristics of a Mineral Resource are known, es timated or interpreted from specific geological
evidence and knowledge, including sampling. Mineral Resources are sub-divided, in order of
increasing geological confidence, into Inferred, Indicated and Measured categories.”
Mineral Resources are reported inclusive of Ore Reserves.
The RPEEE requirement generally implies that the quantity and g rade estimates meet certain
economic thresholds and that the Mineral Resources are reported  at an appropriate cut-off grade
that takes into account extraction scenarios and processing recoveries.
– IIIC-190 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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For DMH and I Zone, in order to determine the quantities of material offering RPEEE by an open pit,
GSR used an open pit optimiser, based on a US$2,050/ ounce (oz) gold price, and reasonable mining
assumptions to evaluate the proportions of the block model that  could be “reasonably expected” to
be mined from an open pit. The optimisation parameters were sel ected based on actual costs from
the operations. The reader is cautioned that the results from the open pit optimisation are used solely
for the purpose of testing RPEEE by an open pit and do not repr esent an attempt to estimate Ore
Reserves. SRK considers that the blocks located within the conc eptual open pit shells and above
the cut-offs (based on a US$2,050/ ounce (oz) gold price) show “reasonable prospects for economic
extraction” and can be reported as a Mineral Resource.
For Wassa B Shoot and 242 underground operations, the undergrou nd Mineral Resources were
reported within Mineable Stope Optimiser (“MSO”), generated by GSR based on a US$2,050/ oz
gold price and mining, processing and general administrative co sts that were adjusted from actual
costs.
Other factors and assumptions in relation to environment, permi tting, legal, taxations, socio-
economic, marketing, and political facts have been considered f or Mineral Resource and Ore
Reserve statements in this Report.
There is no exploration and mining activities for Chichiwelli since 2020. Whilst a drilling program was
initiated at FB/ADK during 2022-2023, and 10,287.4m of drilling  has been completed. Despite this,
the additional drilling information has not been included in the resource estimate. Therefore, the
Chichiwelli and FB/ADK Mineral Res ources are reported the same as the previous 2021 Mineral
Resource Estimate. The Chichiwelli Mineral Resources were reported at a cut-off grade of 0.55 g/t
gold, within the open pit shell calculated at a US$1,500/ oz go ld price. The FB/ADK Mineral
Resources were reported above a gold cut-off grade of 1.4 g/t based on a US$1,500/ oz gold price.
Table 10-54 shows the Mineral Resource statement for the Wassa Operation/Project.
Table 10-54: Mineral Resource Statement, Wassa Project, as of 30 September 2024
Deposit/Category
Tonnage Grade Contained
Au
Contained
Au
kt Au g/t koz t
DMH OP

Measured 393 1.24 16 0.49
Indicated 155 1.20 6 0.19
Measured and Indicated 548 1.23 22 0.67
Inferred 19 1.25 1 0.02
I Zone OP

Measured 37 1.28 2 0.05
Indicated 21 1.65 1 0.03
Measured and Indicated 58 1.41 3 0.08
Inferred 1 1.22 0.03 0.00
Chichiwelli OP

Measured

Indicated 1,110 1.75 62 1.94
– IIIC-191 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Deposit/Category
Tonnage Grade Contained
Au
Contained
Au
kt Au g/t koz t
Measured and Indicated 1,110 1.75 62 1.94
Inferred 50 2.22 4 0.11
FB/ADK UG

Measured

Indicated 1,310 7.96 335 10.42
Measured and Indicated 1,310 7.96 335 10.42
Inferred 2,660 5.30 454 14.12
242 UG

Measured 44 4.10 6 0.18
Indicated 177 2.68 15 0.47
Measured and Indicated 221 2.97 21 0.66
Inferred 42 2.38 3 0.10
B Shoot UG
Measured 6,251 3.09 621 19.32
Indicated 7,210 2.52 585 18.18
Measured and Indicated 13,461 2.79 1,206 37.51
Inferred 58,122 3.29 6,147 191.18
Stockpile (Measured)          DMH Stockpile 26 1.19 1 0.03
UG Stockpile 4 2.31 0 0.01
Total

Measured 6,754 2.97 646 20.08
Indicated 9,984 3.13 1,004 31.24
Measured and Indicated 16,738 3.07 1,650 51.32
Inferred 60,893 3.38 6,609 205.53
Total 77,631 3.31 8,258 256.85
Notes:
1 The Mineral Resource is reported in accordance with the JORC Code guidelines.
2 The information in this report which relates to Mineral Resourc e is based on information comp iled by Mr Huaixiang Li and
Mr Pengfei Xiao who are full time employees of SRK Consulting. Mr Huaixiang Li is a Member of the Australian Institute of
Geoscientists (the “AIG”) and Mr Pengfei Xiao is a Member of th e Australasian Institute of Mining and Metallurgy (the
“AusIMM”) and a Member of the AIG. Both Mr Li and Mr Xiao have sufficient experience which is  relevant to the style of
mineralisation and the type of deposits under consideration and to the activity which they are undertaking to qualify as the
“Competent Persons” as defined in JORC (2012).  Mr Li and Mr Xiao consent to the reporting of this information in the form
and context in which it appears.
3 Mt – million tonnes (metric tons), oz- ounce; koz – thousand ounces.
4 Mineral Resources for B Shoot and 242 underground deposits are reported within mineable stope optimiser (the “MSO”).
5 Open Pit Mineral Resources are reported at a cut-off grade of 0.43 g/t for DMH, 0.73 g/t for I Zone and 0.55 g/t for Chichiwelli.
6 Underground Mineral Resources are reported at a cut-off grade of 1.34 g/t for B Shoot and 242; and 1.40 g/t for FB/ADK.
7 FB/ADK and Chichiwelli Mineral Resources were sourced from the Wassa NI 43-101 Technical Report (March 2021), based
on a US$1,500/ ounce (oz) gold price. No material change has been aware since then.
8 All composites have been capped where appropriate.
9 All figures are rounded to reflect the relative accuracy of the estimate.
10 It should be noted that the Mineral Resource Statement is made for GSWL on the basis of 100% ownership of the properties.
11 The conversion between ounce and gram used herein is 1 oz = 31.1035 g.
– IIIC-192 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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12 Mineral Resources are inclusive of Ore Reserves that have been converted from Measured and Indicated Mineral
Resources.
13 The Mineral Resources Statement as of 30 September 2024 is based on the mineral resource models as of 31 March 2024
and the depletion for the Wassa Mine for the six-month period, 1 April 2024 to 30 September 2024.
10.12 Grade Sensitivity Analysis
The Mineral Resources are sensitive to the selection of the reporting cut-off grade. To illustrate this
sensitivity, the global model quantities and grade estimates are presented in Figure 10-60 to Figure
10-63 at different gold cut-off grades. The reader is cautioned that the figures presented in this table
should not be misconstrued with a Mineral Resource Statement. The figures are only presented to
show the sensitivity of the block model estimates to the selection of gold cut-off grades.
Figure 10-60: DMH Grade Tonnage Curve

Source: SRK
Notes:
1 The reader is cautioned that the  figures should not be misconst rued with a Mineral Resource Statement. The figures are
only presented to show the sensitivity of the block model estimates to the selection of gold cut-off grades.

– IIIC-193 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 10-61: I Zone Grade Tonnage Curve

Source: SRK
Notes:
1 The reader is cautioned that the  figures should not be misconst rued with a Mineral Resource Statement. The figures are
only presented to show the sensitivity of the block model estimates to the selection of gold cut-off grades.

– IIIC-194 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 10-62: 242 Grade Tonnage Curve

Source: SRK
Notes:
1 The reader is cautioned that the  figures should not be misconst rued with a Mineral Resource Statement. The figures are
only presented to show the sensitivity of the block model estimates to the selection of gold cut-off grades.

– IIIC-195 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 10-63: B Shoot Grade Tonnage Curve

Source: SRK
Notes:
1 The reader is cautioned that the  figures should not be misconst rued with a Mineral Resource Statement. The figures are
only presented to show the sensitivity of the block model estimates to the selection of gold cut-off grades.
10.13 Previous Mineral Resource Estimates
GSR carried out the Mineral Resource Estimate in March 2021 and the statement is shown in Table
10-55.
Table 10-55: Wassa Mineral Resource Statement, as of December 31 2020
Deposit/Category Tonnage Grade Contained Au
Mt Au g/t koz
Wassa Main UG
Measured 5.90 4.45 843
Indicated 18.96 3.55 2,162
Measured and Indicated 24.85 3.76 3,005
Inferred 70.50 3.39 7,689
HBB Other OP
Measured / / /
Indicated 0.62 1.21 24
Measured and Indicated 0.62 1.21 24
Inferred 0.77 1.31 32
– IIIC-196 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Deposit/Category Tonnage Grade Contained Au
Mt Au g/t koz
FB/ADK UG
Measured / / /
Indicated 1.31 7.96 335
Measured and Indicated 1.31 7.96 335
Inferred 2.66 5.30 454
Benso OP
Measured / / /
Indicated 1.38 2.50 111
Measured and Indicated 1.38 2.50 111
Inferred 0.05 3.37 5
Chichiwelli OP
Measured / / /
Indicated 1.11 1.75 62
Measured and Indicated 1.11 1.75 62
Inferred 0.05 2.22 4
Total
Measured 5.90 4.45 843
Indicated 23.37 3.59 2,694
Measured and Indicated 29.26 3.76 3,537
Inferred 74.02 3.44 8,183
Sources: Matthew Varvari, S. Mitchel Wasel and Philipa Varris. NI 43-101 Technical Report on the Wassa Gold Mine, Golden Star Resources,
Wassa Gold Mine, Ghana.
Notes:
1 The Mineral Resource estimate complies with the requirements of National Instrument 43-101 and has been prepared and
classified in accordance with the 2014 CIM Definition Standards and 2019 Best Practice Guideline.
2 Underground deposits within the Mineral Resource are reported at a gold cut-off grade of 1.4 g/t.
3 Open pit deposits within the Mineral Resource are reported at a gold cut-off grade of 0.55 g/t, within optimised open pit
shells calculated at a US$1,500 /oz gold selling price.
4 Mineral Resources are reported in-situ without modifying factors.
5 All figures are rounded to reflect the relative accuracy of the estimate.
SRK Canada updated the Year End 2021 resource estimate in Febru ary 2022 as detailed in Table
10-56.
Table 10-56: Mineral Resource Statement of Wassa Main (UG), as of December 31 2021
Category Tonnage Grade Contained Au
Mt Au g/t koz
Measured 8.76 3.38 951
Indicated 22.52 2.99 2,166
Measured and Indicated  31.28 3.10 3,117
Inferred 61.73 3.47 6,893
Source: Golden Star Wassa Resource Model Update, SRK Consulting (Canada) Inc.
Notes:
1 Mineral Resources are not Ore Reserves and have not demonstrate d economic viability. All figures have been rounded to
reflect the relative accuracy of the estimates. Reported at und erground resource cut-off grades of 1.4 g/t gold considering
a gold price of US$1,500 per troy ounce and assuming metallurgical recoveries of 95% for fresh rock.
SRK reviewed and report the 2022 year-end Mineral Resources, as detailed in Table 10-57.
– IIIC-197 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Mineral Resource Estimates    Final
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Table 10-57: Mineral Resource Statement of Wassa Project, as of 31 December 2022
Category Tonnage Grade Contained Au
Mt Au g/t koz
Total
Measured 9.56 3.02 929
Indicated 21.30 3.18 2,175
Measured and Indicated 30.86 3.13 3,104
Inferred 66.11 3.52 7,484
Notes:
1 The Mineral Resource estimate complies with the requirements of National Instrument 43-101 and has been prepared and
classified in accordance with the 2014 CIM Definition Standards and 2019 Best Practice Guideline.
2 Underground deposits within the Mineral Resource are reported at a cut-off grade of 1.4 g/t gold.
3 Open pit deposits within the Mineral Resource are reported at a cut-off grade of 0.55 g/t gold.
4 All composites have been capped where appropriate.
5 All figures are rounded to reflect the relative accuracy of the estimate.
6 It should be noted that the Mineral Resource Statement is made for GSWL on the basis of 100% ownership of the
properties.
7 The conversion between ounce and gram used herein is 1 oz = 31.1035 g.
10.14 Mineral Resource Risks and Opportunities
Risks:
 At Wassa, the gold mineralised bodies are complex and will requ ire additional drilling to ensure
robustness of the grade profile.
Opportunities:
 Exploration works are ongoing to estimate Benso’s UG resource potential.
 At ADK south, Abada and C3PR, Mineral Resource was report in th e 2021 NI 43-101 report.
Additional exploration may result in larger resource footprint.
– IIIC-198 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Ore Reserve Estimates    Final
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11 Ore Reserve Estimates
According to the JORC Code:
an ‘Ore Reserve’ is the economically mineable pa rt of a Measured and/ or Indicated Mineral
Resource. It includes diluting materials and allowances for losses, which may occur when the
material is mined or extracted and is defined by studies at Pre-feasibility or Feasibility level as
appropriate that include application of Modifying Factors. Such studies demonstrate that, at the time
of reporting, extraction could reasonably by justified.
The Modifying Factors are considerations used to  convert Mineral Resources to Ore Reserves.
These include, but are not restricted to mining, pr ocessing, metallurgical, infrastructure, economic,
marketing, legal, environmental, Social and governmental factors.
Figure 11-1 provide for a direct relationship between Indicated Mineral Resources and Probable Ore
Reserve and between Measured Mineral Resources and Proved Ore Reserve.
Figure 11-1: Relationship Between Mineral Resources and Ore Res erve

Sources: JORC Code, page 9
According to the JORC Code, a Probable Ore Reserve is the econo mically mineable part of an
Indicated, and in some cases, a Measured Mineral Resource. The confidence in the modifying factors
for a Probable Ore Reserve is lower compared to a Proved Ore Reserve. A Proved Ore Reserve, on
the other hand, is the economic ally mineable part of a Measured  Mineral Resource and implies a
high degree of confidence in the “Modifying Factors” as the term is defined in the JORC Code.
The Ore Reserve estimates for the Wassa Mine have been prepared  in accordance with the JORC
Code guidelines. These estimates were derived by applying modif ying factors to the Mineral
– IIIC-199 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Ore Reserve Estimates    Final
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Resource Estimate, with only Me asured and Indicated Mineral Res ources being converted to Ore
Reserve. Inferred Mineral Resources were treated as waste with zero grade. Wassa Mine is an
operational mine, the designs and operating practices were reviewed to at least a pre-feasibility study
(“PFS”) level.
11.1 Open Pit Mining
11.1.1 Source of Information
The major files and information provided by Wassa Open Pit Mine are listed below:
 DMH Reserve block model: “dmh_bm_eng_20230901.mdl”
 DMH surface topo: “eom-sept24-with-dump-updates.dtm”
 DMH mine practical pit design: “dmh_pit_design2023_opt9b_clipped.str”
 DMH cut-off grade and optimisation parameters: “Cut_off Grade Calculation – DMH.xls”
 DMH Pit shell: “dmh-export-25-shell-final.dtm”
 Open Pit 2023 production records: “Wassa_Public Stats_2023.xls”
 Open Pit 2024 Q1 production records: “Mining Data_Jan-Mar 2024.xlsx”
 Open Pit 2024 Q2-Q3 production records: “Wassa Operations Statistics_Apr. 24 - Sept. 24.xlsx”
 Open Pit 2024 Q2-Q3 depletion: “SRK_Apr-Sep2024_recon_rescat.xlsx”
 Open Pit Production plan: “GSR_2024 LOM PLAN_DMH.xls”
 Open Pit Production plan: “OP_Pit_Budget_2024.minesched”
11.1.2 Cut-off Grade
The economic parameters, along with a gold price of USD2,050/  oz provide a cut-off grade of
0.5 g/t gold for the DMH open pit as shown in Table 11-1.
Table 11-1: Cut-off Grades and Parameters
Parameter Unit DMH
Revenue
Au price USD/oz 2,050
Government and stream royalty % of revenue 13.5
Mining Parameters
Dilution % 10
Processing Parameters and Costs
Haul to Plant USD/t 0.3
Process plant recovery % 95.5
Process Cost USD/t 15.09
G&A Cost USD/t 7.35
Au Cut-off Grade g/t 0.5
– IIIC-200 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Ore Reserve Estimates    Final
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Source: GSR and SRK
11.1.3 Ore Reserve Statement
Modifying factors such as mining, metallurgical, economic, and marketing factors are considered and
applied when converting a Mineral Resource (only Measured and I ndicated Mineral Resource
categories) to an Ore Reserve.
When applying the modifying factors, SRK estimated the Ore Rese rves of Wassa Open Pit Mine in
compliance with the JORC Code guidelines. Ore Reserve Estimates  as of 30 September 2024 is
summarised in Table 11-2.
Table 11-2: Ore Reserve Statement, Wassa Open Pit Mine, as of 30 September 2024
Deposit/Category
Tonnage Grade Contained Au Contained Au
kt Au g/t koz t
Open Pit
Proved 183  0.97  6  0.18
Probable 355  0.90  10  0.32
Total 538  0.92  16  0.50

Source: GSR, and re-run by SRK based on the following data
Notes:
1 The Ore Reserves Statement is based on the depletion data provided by Wassa Mine for the six-month period, 1 April 2024
to 30 September 2024. The reported Wassa Mine data may differ from that reported by SRK, due the updated Block model
now used by Wassa Mine for reporting. SRK considers this update d block model to be more representative of actual
production conditions and has therefore adopted the Wassa Mine provided data as the basis for this statement.
2 DMH Resource block model: “dmh_bm_eng_20230901.mdl”
3 DMH surface topo: “eom-oct23-with-dump.dtm” (note: no mining activity in November and December 2023)
4 DMH practical pit design: “dmh_pit_design2023_opt9b_clipped.str”
5 No mining recovery and dilution applied.
6 Only Measured and Indicated Mineral Resource considered.
7 Cut-off grades of 0.5 g/t Au for DMH.
8 The accuracy of the Ore Reserve depends on the accuracy of Mineral Resource estimation and data provided.
11.2 Underground Mining
11.2.1 Source of Information
SRK has received the following information from Wassa Mine as below:
1. Geological models
 242_bm_eng_230913.gmdlb
 242bm_240806_dep_MI.gmdlb
 wug_bm_eng1_20230928_dep.gmdlb
 WUDBM_240806_dep_MI.gmdlb
2. As-builts/Production records
– IIIC-201 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1727 ---
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Ore Reserve Estimates    Final
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 Mining Data_Jan-Mar 2024.xlsx
 Wassa_Public Stats_Q2_2024.xlsx
 Resource_depleted_Apr2024-Sep2024.xlsx
 Wassa Operations Statistics_Apr. 24 - Sept. 24.xlsx
 mar24-sep24-stopes.dxf
 Dev_Asbuilts.zip
3. Stopes
 240724_Wassa_SO_MI_ProdSch2024.duf
 242_gc_231019_stopes.dcf
4. Design and Schedules
 Wassa_ProdSch2024.duf, hereinafter referred to as “Wassa Design”
 Wassa_ProdSch2024.dsf, hereinafter referred to as “Wassa Sched”
5. Assumptions and COG calculations
 Client_feedback_Wassa_LOM_Project_Parameters_2024.xlsx
6. Others
 Ventsim™ model (LOM B SHOOT & MAIN COMBINED_2024.vsm)
 Wassa Geotechnical studies
 0424026 Golden Star Wassa - Simple Financial Model v3arev1.xlsx
11.2.2 Cut-off Grade
The cut-off grade for Wassa Underground Mine is based on histor ical cost data and processing
recovery rates, as summarised in Table 11-3. It is reviewed and  updated on an annual basis. As of
the latest update, the current mining cut-off grade is 1.34 g/t Au.
 Gold price of USD 2,050 / oz;
 Mining royalty of 5% and gold royalty of 8.3%;
 Gold processing recovery of 95.5%; and
 Total cash cost USD 72.71 / t.
Table 11-3: Gold Cut-off Grade Calculation
Description Units Value
Revenue Parameters
Gold Price USD/oz 2,050
Process Plant Gold Recovery % 95.5%
Mining Royalty USD/oz 102.5
Gold Royalty USD/oz 170.15
– IIIC-202 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1728 ---
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Ore Reserve Estimates    Final
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Description Units Value
Cost Parameters
Mine Production USD/t 42.47
Sustaining Capital USD/t 8.08
Processing USD/t 14.93
Site G&A USD/t 7.23
Total unit Cash costs USD/t 72.71
Mining Cut Off Grade g/t Au 1.34
Sources: GSR
Stope Optimisation
Stope optimisations were run with a 1.34 g/t Au cut-off grade in Deswik’s Stope OptimiserTM software.
Both 242 area and B Shoot area were optimised with the same parameters. Stope orientation of 242
area is run with a 45- degree rotation along the Z-axis.
A summary of the MSO parameters is presented in Table 11-4.
Table 11-4: Stope Optimisation Parameters
MSO Parameters Value
Vertical Method YZ plane
Minimum Mining Width 5m
Maximum Mining Width 60m
Stope Pillar  10m
Cut-off grade 1.34 g/t Au
Wall Minimum Dip 80⁰
Wall Maximum Dip 100⁰
Variable Overbreak or Slough (VOS)
Bottom 0.2
Midpoint 0.4
Top 0.8
Section (length) Intervals 20m
Level (Height) Intervals 25m
Sections (U) Variable based on mining method and mining lode
Sources: GSR
The stope optimisation result is shown in Figure 11-2.
– IIIC-203 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1729 ---
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Ore Reserve Estimates    Final
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Figure 11-2: Stope Optimisation Results (View from West)

Source: GSR, organized by SRK
11.2.3 Modifying Factors
The mining dilution and recovery rate for stopes and development varies depending on the
production performance. In this report, the dilution rate and recovery rate are shown in Table 11-5.
It should be noted that any diluted material is considered wast e and is assumed to contain no gold
(zero grade).
Table 11-5: Dilution and Loss
Development Dilution Recovery
Development (Au>= Development CoG) 0% 100%
Development (Au< Development CoG) 14% 100%
Stope 10% 95%
Source: GSR
11.2.4 Ore Reserve Statement
Modifying factors such as mining, metallurgical, economic, and marketing factors are considered and
applied when converting a Mineral Resource (only Measured and I ndicated Mineral Resource
categories) to an Ore Reserve.
When applying the modifying factors, SRK estimated the Ore Reserves of Wassa Underground Mine
in compliance with the JORC Code guidelines. Ore Reserve Estimates as of 30 September 2024 is
in Table 11-6.
– IIIC-204 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Ore Reserve Estimates    Final
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Table 11-6: Ore Reserve Statement, Wassa Underground Mine, as of 30 September 2024
Deposit/Category
Tonnage Grade Contained Au Contained Au
kt Au g/t koz t
Underground

Proved 3,339  2.20  237  7.36
Probable 4,935  2.20  349  10.87
Total 8,274  2.20  586  18.23
 Source: GSR, and re-run by SRK
Notes:
1 The Ore Reserves Statement is based on the depletion data provided by Wassa Mine for the six-month period, 1 April 2024
to 30 September 2024. The reported Wassa Mine data may differ from that reported by SRK, due the updated Block model
now used by Wassa Mine for reporting. SRK considers this update d block model to be more representative of actual
production conditions and has therefore adopted the Wassa Mine provided data as the basis for this statement.
2 The Ore Reserve estimate complies and has been prepared and classified in accordance with the JORC code guidelines.
3 Ore Reserves within the underground mine are reported at a cut-off grade of 1.34 g/t Au.
4 Ore Reserves are reported with modifying factors.
5 All figures are rounded to reflect the relative accuracy of the estimate.
11.3 Combined Ore Reserves Statement
SRK has estimated the Ore Reserves of Wassa Mine for open pit, underground, and stockpiles in
compliance with the JORC Code guidelines. The Ore Reserve Estimates as of 30 September 2024
is in Table 11-7. The total Ore Reserve for the Wassa Mine is e stimated at about 8,842 thousand
tonnes (“kt”) at an average grade of 2.12 g/t Au, containing ap proximately 603 thousand ounces
(“koz”) of gold. This includes P roved Ore Reserve estimated at 3,521 kt with an average grade of
2.14 g/t gold, containing 242 koz of gold; and Probable Ore Res erve estimated at 5,291 kt at an
average grade of 2.12 g/t gold, containing 360 koz of gold. The stockpile are the ore that have spilled
from conveyor belts and accumulated over time and are subsequently returned to the ROM Pad.
Table 11-7: Combined Ore Reserve Statement of Wassa Mine as of 30 September 2024 by SRK
Consulting China Ltd
Deposit/Category Category
Tonnage Au Grade Contained Au Contained Au
kt Au g/t koz t
Open Pit Proved 183 0.97 6 0.18
 Probable 355 0.90 10 0.32
  Total 538 0.92 16 0.50
Underground Proved 3,339 2.20 237 7.36
 Probable 4,935 2.20 349 10.87
  Total 8,274 2.20 586 18.23
Stockpile
(Measured) DMH Stockpile 25.98 1.19 1.00 0.03
  UG Stockpile 3.68 2.31 0.27 0.01
Total Proved 3,521 2.14 242 7.53
– IIIC-205 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1731 ---
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Ore Reserve Estimates    Final
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Deposit/Category Category
Tonnage Au Grade Contained Au Contained Au
kt Au g/t koz t
 Probable 5,291 2.12 360 11.19
 Stockpile 30 1.33 1.27 0.04
  Total 8,842 2.12 603 19
Notes:
1 The Ore Reserve Statement as of 30 September 2024 is based on t he ore reserve models as of 31 March 2024 and the
depletion for the Wassa Mine for the six-month period, 1 April 2024 to 30 September 2024.
2 The Ore Reserve is reported in accordance with the JORC Code guidelines.
3 The information in this report which relates to Ore Reserve is based on information compiled by Mr. Alex Thin and Ms.
TzuHsuan Chuang who are full time employees of SRK Consulting. Mr. Thin is a Fellow of the Australasian Institute of
Mining and Metallurgy (the “AusIMM”) and Ms. Chuang is a Member  of the AusIMM. Both Mr. Thin and Ms. Chuang have
sufficient experience which is relevant to the style of mineralisation and the type of deposits under consideration and to the
activity which they are undertaking to qualify as the “Competen t Persons” as defined in JORC Code (2012).  Mr. Thin and
Ms. Chuang consent to the reporting of this information in the form and context in which it appears.
4 Ore Reserves in the table above and in this Report are estimated/ converted from Measured and Indicated Mineral
Resources, therefore double accounting of tonnage should be avoided.
Open pit
5 - Ore Reserves are reported at a cut-off grade of 0.5 g/t Au.
6 - Ore Reserves are reported with modifying factors.
Underground
1 - Ore Reserves are reported at a cut-off grade of 1.34 g/t Au.
2 - Ore Reserves are reported with modifying factors.

– IIIC-206 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1732 ---
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Mining Methods    Final
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12 Mining Methods
12.1 Open Pit Mining
There is one operational open pit (DMH) with a LoM until mid-20 25. The open pit planning process
is a conventional (drill, blast load & haul) best practise indu stry standard. The open pit mining plan
employed an optimisation technique that utilised the key practical and economic elements and with
a practical open pit design to estimate the Ore Reserves.
12.1.1 Open Pit Optimisation
An open pit optimisation was undertaken by Wassa Mine utilizing  WhittleTM software (Whittle). For
the DMH open pit, the updated Mineral Resource model was imported, along with input assumptions,
including:
 Gold price of USD 2,050/ oz;
 Selling cost of 13.3% of the revenue including a government gross revenue royalty of 5%;
 A process plant recovery for oxide and fresh material of 95.5%;
 Mining Factors of 10% dilution and 5% ore loss;
 General and administration (G&A) cost of USD 7.23/ t, hauling cost of USD 0.3/ t, and treatment
costs of USD 15.09/t;
 Mining cost of USD 3.1/ t for weathered material and USD 4.2/ t fresh rock; and
 Open pit slope angle: 52° in fresh rock and 39° in the weathered zone.
SRK found the parameters used in optimisation are based on the historical mining database and
therefore are reasonable. SRK was unable to access the Whittle source files but assumed that the
parameters were allocated appropriately.
Table 12-1 summarises the DMH open pit optimisation parameters.
The open pit shell from this practice as shown in Figure 12-1 a nd is a guide for practical open pit
design.
Table 12-1: DMH open pit Optimisation Parameters
Parameter Unit DMH
Revenue
Au price  USD/oz 2,050
Government and stream royalty % Revenue 13.5
Mining Parameters and Costs
Mining recovery % 95.5
Dilution % 10
Overall slope angle (Ox/ Fr) deg. 39/ 52
Base mining cost (Ox/ Fr) USD/t 3.1/ 4.2
Processing Parameters and Costs
– IIIC-207 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1733 ---
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Mining Methods    Final
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Parameter Unit DMH
Haul to plant USD/t 0.3
Process plant recovery % 95.5
Process cost USD/t 15.09
Other Costs
G&A cost USD/t 7.3
Rehab cost USD/t treat 0.12
Source: GSR and SRK
Figure 12-1: An Isometric View of the DMH Open Pit Shell from the Optimisation Practice

Source: GSR and SRK
12.1.2 Practical O pen Pit Design
The DMH deposit is to the north-east of the Wassa old open pits, and Wassa are carrying out
preparation by removing the topsoil (pre-stripping) from the outcrop quartz veins. The mining method
is currently quarrying that starts on the hill and will convert to an open pit in time.
Figure 12-2 provides a plan view of the DMH final open pit desi gn. SRK evaluated the design and
did not identify any critical flaws; however, it does recommend  some modifications to improve the
mining capabilities:
 When designing the open pit, the minimum mining width should be  incorporated. Certain areas
have extremely restricted access, which poses a significant challenge for mining equipment; and
 The removal of a permanent ramp situated in the western section  of the open pit could result in
a reduction of mining waste.
The 20 m ramp width with a gradient of 10% was utilised to acce ss the open pit levels; this is wide
enough for two-way hauling with 60 t capacity off-highway haul trucks. A conventional open pit mining
method is used by employing excavators and trucks (load and haul) which are considered typical for
– IIIC-208 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Mining Methods    Final
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this type and style of gold mineralisation. Mining will be cond ucted by a contract mining company
who will supply equipment, workforce and supervision services.
SRK did not review the open pit slope angle designs (supporting design analysis); however, the open
pit design slopes and benches are based on the historical geotechnical parameters for the open pits
in the area, with an overall angle of 40° in the weathered zone and 52° in fresh rock. The 12 m bench
height, with a 72° bench face angle designed, while drilling and blasting will be conducted over bench
heights of 6 m. Oxide or weathered material is generally only required to be lightly blasted or in some
areas can be excavated as ‘free dig’. Hydraulic excavators are used in conjunction with conventional
blasting practice, to mine a 3.0 m flitch height. Broken rock is loaded into the haul trucks to a central
stockpile or to the waste dump.
Figure 12-2: DMH Practical Open Pit Design General View

Source: GSR and SRK
12.1.3 Production Schedule
Geovia MineSched software was employed by Wassa Mine to schedule the open pit production. The
ore within the open pit plus 10% dilution and 4.5% ore loss (mi ning recovery 95.5 %) were applied
to the gold grade and ore tonnage.
Wassa Mine intends to deplete the open pit by June 2025, with an average total mining rate of circa
275 kt per month. The ore mined from the open pit will initiall y be stockpiled and blended with the
ore recovered from the underground mines to feed the processing  plant. The other material will be
sent to the nominated waste dump area or stockpiled separately if required.
Table 12-2: Wassa OP Mining Production Schedule
Mine Production & Development Unit Total 2024 Q4 2025
– IIIC-209 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Mining Methods    Final
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OPEN PIT
OPEN PIT - Ore Tonnes t 538,041  79,981  458,061
OPEN PIT - Au Grade g/t 0.92  1.08  0.90
OPEN PIT - Au Metal oz 15,965  2,767  13,198
OPEN PIT - Waste Tonnes t 1, 681,405  635,265  1,046,140
OPEN PIT - Total Material Movement t 2,219,446  715,246  1,504, 200
Source: GSR
12.1.4 Conclusion and Recommendation
This report has been prepared using block models and data supplied by Wassa Mine. It was assumed
that the economic parameters ut ilised in the optimisation and c ut-off grade calculation are from
historical data from the mining database. As such, the report was deemed reasonable. Nevertheless,
the accuracy of the outputs is reliant upon the economic parameters and the accurate estimation of
the Mineral Resource. Any changes in the Mineral Resource estim ations, also in the economic
parameters such as gold price may cause the changes in open pit  limits and therefore in the
estimated Ore Reserves.
12.2 Underground Mining
12.2.1 Introduction
Development of the Wassa Underground Mine began in 2015, and it started commercial production
in January 2017.
Wassa has provided SRK the Wassa Design and Wassa Sched, utilis ing Deswik™ software. The
mine consists of two primary mining areas: Zone 242 and Zone B Shoot, with Zone B Shoot
comprising the main, south, and south deep sections (refer to F igure 12-3). The majority of the
Measured and Indicated Mineral R esources are within the Zone 242 and the main/  south areas of
Zone B Shoot.
– IIIC-210 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1736 ---
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Mining Methods    Final
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Figure 12-3: Wassa Underground Mining Areas (Zone 242 and Zone B Shoot)

Source: GSR and SRK
12.2.2 Geotechnics
The geotechnical analysis pres ented in section 12.2.2, is based  on the studies and analyses
undertaken by SRK Consulting Sout h Africa (“SRK ZA”), and repor ted in March 2021 (“SRK ZA,
March 2021”).
Geotechnical Domain and Characterisation
Previous SRK reports classified the Wassa deposit into three main geotechnical domains as:
 Footwall Domain;
 Orebody Domain; and
 Hanging wall Domain.
The geotechnical characterisation has been based on the following data sources:
 Geotechnical data available in the GSWL surface exploration and underground drilling geological
logs;
 Logs of the underground boreholes that had been subject to detailed geotechnical logging;
 A limited set of laboratory strength and deformation test results; and
 Review of underground mapping data.
The joint sets presented in the stereonet plot shown in Figure 12-4 and summarized in Table 12-3
form the basis for the stope stability assessment. The structural information at the mine site has not
been updated since last reported.
– IIIC-211 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Independent Competent Person’s Report for Wassa Gold Mine, Akyempim, Western Region, Ghana
Mining Methods    Final
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Figure 12-4: Stereonet Plot of Wassa Joint Set Database

Source: SRK ZA, March 2021
Table 12-3: Joint Sets Used for Stope Design
Discontinuity
Set Dip (°) Dip Direction (°) Comments
Foliation 52 275 Tightly healed foliation planes
J1 45 11 Set of tightly healed No rth-east trending joints
J2 62 155 Set of tightly healed So uth-east trending joints
J3 15 276 Set of sub-Horizontal  North-west trending joints
J4 79 42 Set of steeply dipping North trending joint
Source: SRK ZA, March 2021
In-Situ Stress
In September 2019, Wassa mine conducted an Over-Coring stress m easurements to measure in-
situ stress levels in the mine. The measurement was carried out from the footwall of the 570 decline
and the hanging-wall at 645-DD7. T he 645-DDT was discarded due to its closeness to and the
potential influence from the open pit mining with regards to stress redistribution.
The results from the 570 decline are shown in Table 12-4 and the interpreted depth gradient is shown
in Figure 12-5.
Table 12-4: 570 Decline Stress Measurement
Principal Stress Magnitude
(Mpa)
Depth
(m) Ratio Gradient
(MPa/m) Dip Direction
Major 26.5 430 2.23 0.062 4° 339°
– IIIC-212 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Mining Methods    Final
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Principal Stress Magnitude
(Mpa)
Depth
(m) Ratio Gradient
(MPa/m) Dip Direction
Intermediate 18.9 430 1.59 0.044 6° 69°
Minor 11.9 430 1.00 0.028 83° 219°
Source: SRK ZA, March 2021
The In Situ stress measurement indicates that the major principal stress is horizontal and parallel to
the main orebody. The intermediate principal stress is perpendicular to the strike of the orebody, and
the minor Principal stress corresponds to the overburden stress . These orientations have been
applied in principle to the design of the Huni Butre and Benso underground projects – particularly the
Adoikrom and Father Brown underground project. These projects lay with the proximity of the Wassa
main.
Figure 12-5: Principal Stress Measurement Magnitude vs Depth

Source: SRK ZA, March 2021
Rock Mass Characteristics
The geotechnical cores and underground exposures were mapped as per CSIR Rock Mass Rating.
The data was then processed to produce the modified NGI (Norwegian Geotechnical Institute) Rock
Mass Quality Q-system and the Geological Strength Index. These rock mass parameters were then
employed in the development and stope support designs.  The representative rock mass parameters
are based on laboratory testing. The rock mass condition data o f the Wassa geotechnical domains
used for geotechnical analyses or numerical modelling are shown in Table 12-5.
The rock mass quality is classified Very Good, using Barton’s (Barton et al, 1974) classification and
Geological Strength Index (GSI) rating systems.
– IIIC-213 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Mining Methods    Final
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Table 12-5: Wassa Rock Mass Characterization Parameters (Barton et al, 1974)
Parameter
Footwall / Orebody / Hanging
Wall Source
MIN MAX Average
Rock Quality Desc. RQD% 85 90 85 Geotechnical and mapping
Joint Number  Jn 6 9 6 Borehole structural data and
mapping
Joint Roughness  Jr 3 4 3 Detailed geotechnical logs &
mapping
Joint Alteration  Ja 1 0.75 1 Detailed geotechnical logs &
mapping
Q’ 43 53 48
Rock Mass Quality  Very
Good
Very
Good
Very
Good
Geol. Strength Index  GSI 78 80 78 Underground mapping &
inspections
Unconfined Compressive
Strength
UCS
Mpa 110 160 135 Rocklab laboratory test result
Unconfined Tensile
Strength
UTS
MPa 16 18 17 Rocklab laboratory test result
Young’s Modulus  GPa 70 80.5 75.3 Rocklab laboratory test result
Poisson’s Ratio 0.28 0.32 0.3
Density t/m3 2.79 2.81 2.8 Rocklab laboratory test result
Source: SRK ZA, March 2021
Development Support
The ground support design for Wassa underground operations is based on Barton’s Q-Index support
chart. The designed width of major long-term excavations is 5.5 m. As long term mine excavations
(main access ramp/ decline, footwall drive and level access dri ve) an Equivalent Support Ratio
(“ESR”), of 1.6 is assumed, Barton and Grimstad (1993). The est imated Equivalent dimension is
plotted on the Q-Index support chart and the support requiremen t read from it.  Based on the rock
mass characterisation the excavations within the Wassa mine, wi ll not require systematic ground
support.
As part of management’s risk aver sion all excavations are suppo rted. The actual support plots in
category 3 whilst the designed plots in category 1 as shown in Figure 12-6.
Wassa has two systematic support patterns for good and poor gro und conditions. The support for
poor ground conditions is actioned by the geotechnical engineer , otherwise the good ground
condition support pattern applies to all excavations.
The standard support pattern consists of galvanized 2.4 m long, 46 mm diameter Split Sets (a form
of friction stabilizer) and 4.2 x 2.4 m sheets of wire meshing. Wire mesh is installed on the roof, from
corner to corner, for good ground conditions with an additional two split sets installed below the top
corners on either side. The wire mesh extends from grade line to grade line for poorer ground
conditions.  Any change in the support standards may have to be  based on fall-out measurements
and minimum bond length required to hold such fall-outs.
The empirical support design is supported with numerical analys is with software such as
UNWEDGE™, (analysis of structurally controlled instability), and PHASES 2D™, (analysis of stress
induced failure).
– IIIC-214 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1740 ---
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Mining Methods    Final
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Figure 12-6: Support, Barton’s Q-Index Chart (Barton and Grimstad, 1993)
Source: Geotechnics, GSR
Modified Stability Number
The Q’ value derived from the geotechnical characterisation has  been used in conjunction with the
stability graph parameters A, B and C to determine the Modified Stability Number (N) for stope roof,
end walls and hanging walls. Stress parameter A has been estimated by calculating the gravitational
stress generated from the weight of the overburden rock above the mining.
The structural parameters B and C were derived from an assessment of the interaction of the
dominant joint sets with the stope boundaries. The Table 12-6 a nd Table 12-7 show the Modified
stability number (N) for the transverse and longitudinal stopes as applied to the Wassa main orebody.
Table 12-6: Modified Stability Number (N’) for Panels 1-3, Transverse Stopes (Potvin, 1988)
Parameters Stope Wall, Transverse Comments Back Side End
Q’ 47.9 47.9 47.9
UCS, Sigma C  Mpa 130 130 130 Average intact rock strength
Depth m 500 500 500 Average depth below Panel 2
Max. Principal Stress, Sigma
1  Mpa 13.5 13.5 13.5 Estima ted overburden stress
Stress: Strength Ratio  0.9 0.9 0.9
Factor A  1.9 1.0 1.0
Angle between Stope Face &
Daylighting Joint   15° 15° 15° Critical Joint for all back and side-
walls is J3, end-wall is J4.
Factor B  0.2 0.2 0.5
– IIIC-215 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Parameters Stope Wall, Transverse Comments Back Side End
Potential Failure Mode  Gravity Slabbing Gravity Gravity or Slabbing
Dip of face  0° 90° 64°
Factor C  2 8 5
N=Q’ x A x B x C  19.2 76.7 119.8 N-value fo r all stopes >=64° slope
Source: SRK ZA, March 2021
Table 12-7: Modified Stability Number (N’) for Panels 1-3, Longitudinal Stopes (Potvin, 1988)
Parameter Stope Wall, Longitudinal Comments Back Side End
Q’  47.9 47.9 47.9 Average Intact rock strength
UCS, Sigma C Mpa 130 130 130 Aver age intact rock strength
Depth  m 500 500 500 Average depth below
surface, Panel 2
Max. Principal Stress,
Sigma 1  Mpa 14.6 14.6 14.6 Estimat ed overburden stress
Strength- Stress Ratio 1: 8.1 8.1 8.1
Factor A  0.9 0.9 0.9
Angle between Stope
face & Daylighting Joint  15° 45° 15°
Critical Joint for all back and
side-walls is J3, end-wall is
J4
Factor B  0.2 0.2 0.5
Potential Failure Mode   Gravity Slabbing Slabbing Gravity / Slabbing
Dip of Stope Face  0° 64° 90°
Factor C  2 4.9 8
N=Q’ x A x B x C  17.3 106.3 69 N-value for all stopes >=64°
slope
Source: SRK ZA, March 2021
Modified Stability Graph
The calculated stability number, ‘N’, for each stope surface is  plotted on ‘N’ vs Hydraulic Radius,
(HR), chart to determine its stability. The stope back, hanging wall, footwall and end wall all plotted
in stable without support envelop. Figure 12-7 and Figure 12-8 show the stability graph of the
transverse and longitudinal stopes.
The hanging wall stability number ranges from 40 to 76.7. Plott ing the stability graph in a different
style using N=40, as shown in Figure 12-9, gives different comb inations of stope strike lengths and
hanging wall vertical heights for any given HR value. This indicates that a stope of 20 m strike length
can be mined to an infinite depth with a stable hanging wall ex posure. This supports the field
observations in S12 which has a height of 125 m after damaging the 10 m sill pillar at Level 520.  It
is reported that many of the 100 m high stopes remain stable with minimum wall failures from Cavity
Monitoring System (CMS) surveys. (Wassa Site Engineer).
– IIIC-216 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1742 ---
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Mining Methods    Final
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Figure 12-7: Matthews Stability Graph, Transverse Stopes (Mathews et al, 1981)

Source: SRK ZA, March 2021
– IIIC-217 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1743 ---
Independent Competent Person’s Report for Wassa Gold Mine, Akyempim, Western Region, Ghana
Mining Methods    Final
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Figure 12-8: Matthews Stability Graph, Longitudinal Stopes (Mathews et al, 1981)

Source: SRK ZA, March 2021
Figure 12-9: Matthews Stability Graph, Longitudinal Stopes (Mathews et al, 1981)

Source: SRK ZA, March 2021
– IIIC-218 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1744 ---
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Mining Methods    Final
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Stable Slope Design Geometry
The Wassa mine operates within a certain range of stable stope dimension as detailed in Table 12-8.
These parameters were computed from the stability graph and cover both transverse and longitudinal
mining for Wassa main.  Panel 2 i s currently active and employs both mining methods. Panels 4 to
8 will employ mainly longitudinal mining method.
Table 12-8: Stable Stope Dimensions, Panels 1-8
Stope Dimension
Transverse Stope Longitudinal Stope
MIN MAX DESIGNED
[M] MIN MAX DESIGNED
[M]
Height m 25 100 100 <15 25 25
Strike Length m 25 25 25 <60 70 70
Width across Strike m 15 30 25 <15 15 15
Dip, end/sidewall  65° 65° 65° 65° 65° 65°
Source: Geotechnics, GSR
Major Pillars
 B Shoot Crown Pillar
A 25 m crown pillar separates the main orebody, B Shoot, and the bottom of the open pit. See Figure
12-10. The stability of the Crown Pillar between the B Shoot Ma in open pit and 720-N1 stope was
assessed during the FS by SRK using Phases 2D software. A factor of Safety of 1.58 was assigned.
There are also several 10 m sill pillars separating mined out s topes in Panels 1 & 2 which are filled
with either waste rock fill or pastefill. Similarly, the sill P illar between 720-N1 and 745-S1 was
assigned a Safety factor of 1.58. See Figure 12-11.
Figure 12-10: Longitudinal View Showing the Main Crown Pillar

Source: Geotechnics, GSR
– IIIC-219 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1745 ---
Independent Competent Person’s Report for Wassa Gold Mine, Akyempim, Western Region, Ghana
Mining Methods    Final
SRK CONSULTING (CHINA) LTD.   28 FEBRUARY 2025  PX/AT - 201 -
Figure 12-11: B Shoot Pillars, Modelled Factors of Safety from Phase 2 Software, (GSR, 2018)

Source: SRK ZA, March 2021
Geotechnical Assessment for Wassa Design
During the development of the Wassa Design, a geotechnical asse ssment was conducted by Mr.
Amir Karami, Principal Geotechnical Engineer and Competent Pers on in Geotechnical Discipline,
from BGC Engineering Inc. ("BGC"). The assessment primarily focused on two aspects:
 If GSR reduced the crown pillar thickness from the previously recommended 30 m to 20 m. This
involved evaluating the stability of the proposed 20 m thick crown pillar for the planned openings
immediately below and adjacent to the existing open pit.
 Reviewing the stability of the proposed permanent footwall drives near the planned open stopes.
The empirical Scaled Crown Span methodology was used for the cr own pillar stability assessment,
leading to the following conclusions:
– IIIC-220 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1746 ---
Independent Competent Person’s Report for Wassa Gold Mine, Akyempim, Western Region, Ghana
Mining Methods    Final
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 For the Q rock mass rating, with a crown pillar thickness of 20  m, a stope span of 20 m, and a
stope length of 30 m, the crown pillars immediately below the o pen pit bottom and adjacent to
open pit walls remain stable (FoS > 1.6) with a low probability of failure.
 Increasing the stope span to 25 m reduces the FoS to below 1.5 and increases the probability of
failure, though it remains low.
 Increasing the stope length to 50 m also reduces the FoS and increases the probability of failure,
but the impact is less pronounced than increasing the stope span.
 Increasing the crown pillar thickness enhances stability (FoS >  1.9) and reduces the probability
of failure to approximately 4%, but this comes at the cost of sterilizing ore within the crown pillar.
BGC provides the following considerations for rib pillar design  between the footwall drives and the
open stopes:
 Stopes with at least a 10 m offset from footwall drives can be mined, but ground conditions and
support performance should be monitored and evaluated, with proper remediation carried out as
needed before commencing open stope mining near footwall drives.
 Although GSR has not experienced instability issues in footwall drives from nearby stope
blasting, future damage may occur due to rock mass variability and stope blasting.
 If there are concerns about the stability of the footwall drive, GSR should consider delaying the
mining of nearby open stopes. A potential option is to mine these stopes on retreat or at the end
of the mine life.
12.2.3 Mining Method
The Wassa Mine operations started as an open pit and transition ed into an underground mine in
2015. It will continue to be mined by underground methods using a top-down sublevel open stoping
(SLOS) method.
Stoping Methodology
The stopes are mined using transverse stoping, with longitudinal stoping. Stope dimensions are 20 m
along strike, various width depending to the stope shapes and 25 m height (level spacing).
 Transverse stoping: Stopes are defined as primary and secondary. The primary stopes would be
mined and then paste backfilled. Once mined, the secondary stop es would be backfilled with
either paste or waste rock. Generic sections for a primary transverse stope are shown in Figure
12-12. The Wassa Mine assumes that no sill pillar would be left behind.
 Longitudinal stoping: Stopes are be mined in a backward directi on from the end. Once the first
stope has been mined, the paste wall would be built away from the open stope in two cuts (6m).
This is followed by a "plug pour" and then a "main pour." There will be a 7-day curing delay from
the "plug pour" to allow the plug strength to develop. To mine the subsequent stope, the paste
wall would be broken, and two cuts (6m) would be made back into  the previously paste-filled
stope to allow a production drill to come in and set up on the first ring. After this slot drive
development, cable bolting of the stope and production drilling of the slot and rings begin.
– IIIC-221 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1747 ---
Independent Competent Person’s Report for Wassa Gold Mine, Akyempim, Western Region, Ghana
Mining Methods    Final
SRK CONSULTING (CHINA) LTD.   28 FEBRUARY 2025  PX/AT - 203 -
Figure 12-12: Schematic of Primary Transverse Stope (Illustration Not to Scale)

Source: 02Tec Report-Wassa-Dec2020-NI43-101-Tech-Report-DRAFT-v20210301-(final)-CONFORMED.pdf
12.2.4 Development Design
In Figure 12-13, the main decline portals (including 242 Portal, B Shoot Portal and Portal 3) are from
the open pit and are designed with a cross-section of 5.8 m (H) by 5.5 m (W) to allow 45 t and 55t
capacity haul trucks to haul ore and waste.
– IIIC-222 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1748 ---
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Mining Methods    Final
SRK CONSULTING (CHINA) LTD.   28 FEBRUARY 2025  PX/AT - 204 -
Figure 12-13: Wassa Underground Development Design (Looking East)
Source: GSR and SRK
12.2.5 Production
The current ore production target from the stopes and developme nts is between 7,000 and 8,000
tonnes per day. The ore is transported by 45 t and 55t articulated dump trucks (“ADT”) to the stockpile
designated at Portal 3. Waste material is primarily used for backfilling voids or is transported to waste
rock dumps on surface.
Blasting operations occur twice daily, at 6AM and 6PM. These ti mes also mark the shift changes,
with workers transitioning from the day shift to the night shift and vice versa.
Mining operations at the Wassa Main are conducted by the owner, while the 242 and Wassa South
areas are managed by contractors.
12.2.6 Equipment
The Wassa underground equipment is listed in Table 12-9. The mo del of production drill rig is DL
411, DL421 and DL 431. The model of jumbo is DD421-60. There are several LHD (load-haul-dump)
models: R2900; LH517; LH 621. The model of the ADT is A45G. The availability of the equipment is
above 80%. The contractor’s equipment is listed in Table 12-10.
– IIIC-223 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1749 ---
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Mining Methods    Final
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Table 12-9: Wassa Underground Equipment List
Equipment Model Quantity Availability
Truck Volvo A45G ADT 9 85%
Loader CAT R2900G 3 80%
Loader Sandvik LH517 1 80%
Loader Sandvik LH621 2 80%
Loader Sandvik LH621i 1 80%
Jumbo Sandvik DD421 7 85%
Solo Sandvik DL411 1 85%
Solo Sandvik DL421 1 85%
Solo Sandvik DL431 1 85%
Solo Sandvik DL431 1 85%
Normet Normet 1610B Charmec 1
Normet UCT 2
Manitou MT-X1840 1
Integrated Telehandler 4 85%
Grader CAT 12H 1
Grader CAT 12M 1
Source: Wassa Mine
Table 12-10: Contractor Equipment List
Equipment Model Quantity Contracto r
Trucks Volvo A45G ADT 3 Edgate
Jumbo (Boomer) BOOMER282 3 Setters
Production Drill Rig SIMBA 1354 1 Setters
Loaders ST18 2 Setters
Loaders ST18 2 Setters
Trucks MT54 6 Setters

Source: GSR
12.2.7 Production Schedule
There are two main components in the production schedule: devel opment and stopes. For
development, the main activity ty pes, their respective schedule d rates, and section sizes are
presented in Table 12-11 below.
Table 12-11: Development Tasks in Schedule
Development Tasks Task Rate Section
Decline 50m/mo & 90m/mo 5.5mW x 5.8mH
Level Access 50m/mo & 60m/mo 5.0mW x 5.0mH
– IIIC-224 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1750 ---
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Mining Methods    Final
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Development Tasks Task Rate Section
Escapeway Access 50m/mo 5.0mW x 5.0mH
Electrical Cuddy 50m/mo 5.0mW x 5.0mH
Exploration Drive 50m/mo 5.0mW x 5.0mH
Ore Drive 50m/mo 5.0mW x 5.0mH
Stockpile 50m/mo 5.5mW x 5.8mH
Sump 50m/mo 5.0mW x 5.0mH
Vent Access 50m/mo 5.5mW x 5.8mH
Source: GSR
The Table 12-12 below indicates the primary activities during stoping and the designed rates.
Table 12-12: Stope Task in Schedule
Stope Tasks Task Rate
Backfill Development 1.5 days
Slot Drive 60m/mo
Cable Bolt Support 230m/d
Boxhole Rise 4m/d
Stope Rise 1.3d
Production Drilling 250m/d
Bogging 1,700t/d
Backfill Preparation 13.9d
Backfill Paste 1,200m3/d
Backfill Waste Rock 600m3/d
Backfill Cure Delay 7d
Source: GSR
Ore Reserves Plan
Ore Reserves Plan (Only Measured and Indicated Mineral Resource s, as per the JORC Code
guidelines for the reporting of Ore Reserves) is based on the Wassa Design and Wassa Sched, with
a LoM of five years, as shown in Table 12-13. Ore Reserve schedule will be used in the technical
economic analysis.
Table 12-13: Ore Reserves Plan
Mine Production & Development Unit Total 2024 Q4 2025 2026 2027  2028
OPEN PIT
Ore Tonnes t 538,041  79,981  458,061
Au Grade g/t 0.92  1.08  0.90
Au Metal oz 15,965  2,767  13,198 - - -
Waste Tonnes t 1,681,405  635,265  1,046,140
Total Material Movement t 2,219,446  715,246  1,504,200
– IIIC-225 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Mining Methods    Final
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Mine Production & Development Unit Total 2024 Q4 2025 2026 2027  2028
UNDERGROUND
Ore Tonnes t 8,274,022 899,306 2,750,799 2,516,877 1,614,222 492,818
Au Grade g/t 2.20 2.20 2.13 2.29 2.24 2.05
Au Metal oz 585,981 63,647 187,961 185,510 116,452 32,411
Waste Tonnes t 2,236,924 395,939 1,123,668 574,812 132,779 9,726
Total Material Movement t 10,510,946 1,295,246 3,874,466 3,091,689 1,747,002 502,543
Total (OP + UG)
Ore Tonnes t 8,812,064  979,287  3,208,859 2,516,877 1,614,222 4 92,818
Au Grade g/t 2.12  2.11  1.95 2.29 2.24 2.05
Au Metal oz 601,946  66,414  201,159 185,510 116,452 32,411
Waste Tonnes t 3,918,329  1,031,205  2,169,807 574,812 132,779 9 ,726
Total Material Movement t 12,730,392 2,010,492  5,378,667 3,091 ,689 1,747,002 502,543
Development Meters
Lateral Operating Development m 15,480  4,333  5,372 3,945 1,63 5 194
Lateral Capital Development m 20,140  3,121  11,067 5,123 828 -
Vertical Capital Development m 1,448  220  733 414 82 -
Backfill
Pastefill m3 2,128,352  187,178  678,193 731,515 449,982 81,484
Rockfill t 1,653,541  72,271  592,791 358,842 341,201 288,436
Source: GSR
Notes: Scheduling start date: 1 October 2024
12.2.8 Mine Service
Paste Backfill
In 2015, Kovit Engineering (“Kovit”), based in Sudbury, Canada, undertook the design and cost
estimates that formed the basis of the paste backfill system. The overall system is depicted in Figure
12-14.
– IIIC-226 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1752 ---
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Mining Methods    Final
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Figure 12-14: Backfill system proposed by Kovit
Source: Kovit, 2015
According to the FS 2015, cement  rock fill (CRF) and waste rock  fill (RF) were nominated for
transverse primary and secondary stopes, respectively. Later on, paste backfill studies were carried
out by Outotec (Canada) Ltd. and completed in 2019. In 2020, th e Wassa Mine completed the
construction of the paste backfill plant.
In Wassa Design and Updated Wassa Design, paste backfill will be required to maintain support for
mining the secondary transverse stopes and longitudinal stopes, thereby increasing the overall level
of extraction. Secondary stopes for transverse stopes will be filled with RF as required.
Ventilation
Ghanaian mining regulations stipulate the following:
 A maximum velocity of 6 m/ s in travelling roadways.
 For diesel engine equipment, a minimum airflow of 0.06 m³/ kW/ s.
 A minimum velocity of 0.2 m/ s in headings and 0.1 m/ s in large openings.
 A maximum wet bulb temperature of 32.5ºC for working conditions.
 Continuous monitoring of CO levels in return airways with information transmitted to the surface.
According to FS 2015, SRK conducted an analysis of ventilation requirements at Wassa using
VENTSIM VISUAL™ software. The aim of this analysis was to determine the primary and secondary
fan requirements, as well as duct and airway sizes. The analysi s was carried out in two phases,
depending on the mining panels and levels. The Figure 12-15 below indicates the Phase 2 ventilation
system.
– IIIC-227 –
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FOR THE WASSA GOLD MINE


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Figure 12-15: Phase 2 Ventilation System
Source: FS, 2015
Upon completion of the FS 2015, several changes occurred in the underground mine:
 The mine development in FS 2015 reached 412 m RL, while the low est development levels for
Wassa Design/ Sched and Updated Wassa Design have reached 370 m  RL and 270 m RL,
respectively.
 The production capacity has increased from 0.8 Mtpa to 2.8 Mtpa.
 The number of main production fleet units has correspondingly increased.
 For B Shoot, the main ventilation intake has changed from solely B Shoot Portal to both B Shoot
Portal and Portal 3.
The mine continuously updates the ventilation systems as mining expands laterally and with depth.
During the site visit, SRK observed that the ventilation is ade quate and effective, and mined-out
areas have been properly barricaded. However, SRK recommends that Wassa Mine conduct a
comprehensive ventilation assessment to support the ventilation  design as the mine plans depth
extension in the future.
Communication
Frontline mine communication is facilitated via a leaky feeder VHF communications system and a
two-way radio network. An antenna on the surface, along with ca bling in the decline and all waste
development headings, provides reliable communication to the working areas at Wassa.
All mobile equipment is equipp ed with radios in the operators' cabins, and portable handsets are
available for mechanics, supervisors, and other personnel as required.
– IIIC-228 –
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FOR THE WASSA GOLD MINE


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Dewatering
The mine dewatering system is designed to remove both groundwater and service water. The system
is designed to handle a flow rate of 35 l/s. The Figure 12-16 indicates the final dewatering design as
per the FS 2015.
Figure 12-16: Final Dewatering
Source: FS, 2015
The mine continuously updates the dewatering systems as mining expands laterally and with depth.
During the site visit, SRK observed that the tunnel and stoping  areas were dry and clean, and that
housekeeping has been well maintained.
SRK recommends that Wassa Mine conduct a comprehensive dewateri ng assessment to support
the dewatering design as the mine plans depth extension in the future.
Water Supply
Water tanks are installed above the portal area to supply the u nderground mine with service water
for drilling, dust suppression, and general use. Service water is sourced from either the starter open
pit sump or the Dead Man Hill open pit sump. It is reticulated throughout the mine via 110 mm high-
density polyethylene (“HDPE”) lines installed in the primary headings, reducing to 63 mm HDPE lines
for supply to end-use locations. Pressure reducers are installe d as required to always maintain the
pressure within the range of 4-12 bar. There are number of surface catchment areas situated in close
proximity of the underground portals, that form part of the closed-loop water supply system.
Compressed Air
It is planned that compressed air will only be needed for minor service work. To this end, a 110 mm
poly pipes are reticulated underground down the main decline. A  compressor house situated at the
B-Shoot portal equipped with 90 kW compressors, provide pressure of 6.5 bar and a flow rate of 17.5
m³/ min to the mining areas, making use of a ring main system.
– IIIC-229 –
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FOR THE WASSA GOLD MINE


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Underground Magazines
Detonators, explosives and blasting agents are stored at the ex isting Wassa magazine on surface,
delivered from existing suppliers in Ghana, currently African E xplosives Limited (“AEL”). Utility
vehicles transport the explosives underground for storage in approved underground magazines that
are constructed to hold 3-4 days’ worth of explosives.
Emergency Egress
A series of manways between levels, each approximately 15 to 20 m in length and inclined at 65-75º
to the horizontal with a cross-sectional area of 1.2 m by 1.2 m, have been constructed. Each manway
is fitted with ladderways and rest platforms in compliance with Ghanaian mining regulations.
The escapeway system provides a secondary means of access from every sub-level and is separate
from the main decline.
Several Sixteen-person Refuge/ emergency chambers have been ins talled in the mine as
development progresses.
12.2.9 Wassa Ore Reserve s and Upside Plan
The Wassa Mine has provided SRK the Ore Reserves plan (Wassa De sign/ Schedule) and an
upside/ opportunities plan, based on the Wassa Design/ Schedule , but including immediately
identifiable upside/ opportunities (though not classified as Or e Reserve in this evaluation). The
comparison of the two is highlighted in Figure 12-17.
Figure 12-17: Stope comparison between Wassa Design and Updated Wassa Design
Source: GSR and SRK
Notes:
The purple blocks are the additional ‘non Ore Reserve stopes’/ addition material included in Update Wassa Design
– IIIC-230 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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During discussions with the Wassa Mine, SRK understands that Up dated Wassa Design includes
Residual material in the upper area and Material in the lower area. Due to time limitation of preparing
Updated Wassa Design, SRK would consider this as an opportunity for eventual economic material
but does not regard it as classified as Ore Reserves.
To classify the additional Mineral Resources as Ore Reserves, c omprehensive technical studies
across various disciplines (geotechnical, hydrogeology, ventila tion, infrastructure, etc.) must be
conducted to determine the feasibility of their exploitation. These studies should be at least at a PFS
level, including an assessment of the methods of exploitation.
Although SRK cannot currently classify the Residual Material in  upper area (“Residual Material
(upper area)”) and Material in lower area (“Material (lower are a)”) from Updated Wassa as Ore
Reserves, SRK considers this material under a scoping study level and has reasonable grounds for
disclosing a production target that includes this amount of Indicated Mineral Resource as an upside
opportunity case.
The schedule is shown in Table 12-14.
Table 12-14: Wassa Ore Reserves and Upside Plan
Mine Production &
Development Unit Total 2024 Q4 2025 2026 2027 2028
Open Pit
Ore Tonnes t 538,041  79,981  458,061 - - -
Au Grade g/t 0.92  1.08  0.90 - - -
Au Metal oz 15,965  2,767  13,198 - - -
Waste Tonnes t 1,681,405  635,265  1,046,140 - - -
Total Material Movement t 2,219,446  715,246  1,504,200 - - -
Underground
Ore Tonnes t 8,274,022  899,306  2,750,799 2,516,877 1,614,222 1,666,590
Au Grade g/t 2.20  2.20  2.13 2.29 2.24 1.82
Au Metal oz 585,981  63,647  187,961 185,510 116,452 97,506
Waste Tonnes t 2,236,924  395,939  1,123,668 574,812 329,310 170,965
Total Material Movement t 10,510,946  1,295,246 3,874,466 3,091,689 1,943,532 1,837,555
Upside Plan
Residual ROM Material
(Upper Area) t 436,138   436,138
Au Grade g/t 1.75   1.75
Au Metal oz 24,491   24,491
ROM Material (Lower Area) t 737,635   737,635
Au Grade g/t 1.71     1.71
Au Metal oz 40,604     40,604
Waste Tonnes t 357,770    196,531 161,239
– IIIC-231 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Mine Production &
Development Unit Total 2024 Q4 2025 2026 2027 2028
Total Material Movement t 1,531,542    196,531 1,335,011
Total
ROM Tonnes t 9,985,836  979,287  3,208,859 2,516,877  1,614,222  1,666,590
Au Grade g/t 2.08  2.11  1.95  2.29  2.24  1.82
Au Metal oz 667,041  66,414  201,159  185,510  116,452  97,506
Waste Tonnes t 4,276,099  1,031,205 2,169,807 574,812  329,310  170,965
Total Material Movement t 14,261,934  2,010,492 5,378,667 3,091,689  1,943,532  1,837,555
Development Meters
Lateral Operating Development m 16,336  4,333  5,372 3,945 1,635 1,050
Lateral Capital Development m 23,179  3,121  11,067 5,123 3,077 790
Vertical Capital Development m 1,448  220  733 414 82 -
Backfill
Pastefill m3 2,563,083  187,178  678,193 731,515 449,982 516,215
Rockfill t 1,653,541  72,271  592,791 358,842 341,201 288,436
Source: GSR and SRK
12.2.10 Life of Mine Schedule
During the SRK site visit, GSR presented their in-fill drilling plan and budget aimed at upgrading the
Inferred Mineral Resource to Indicated/ Measured Mineral Resource in the near future.
The Wassa Mine has developed a life of mine plan that includes Inferred Mineral Resource and
outlines two designs/ studies for future expansion. SRK note th at this cannot be considered as an
Ore Reserve as it is based on Inferred Mineral Resource. In order to classify as Proved or Probable
Ore Reserve category, technical studies need to be completed to  at least a PFS level with an
appraisal of how access would be achieved, mining methodology (including extraction and dilution
factors), the geotechnical under standing as well as ventilation . Along with the technical
understanding and extraction achievability, the economics of each area needs to be proved, i.e. with
the application of Capex and Opex, is it economic to mine, cash flow positive.
The first design, with a Preliminary Economic Assessment (“PEA” ) for the Wassa’s Southern
Extension conducted by GSR in 2021, divides the Wassa Undergrou nd mine into 8 panels with the
same stope optimization parameters but different other stope modifying factors such as dilutions and
stope recoveries. The PEA has considered a long-term LoM schedu ling, which is conceptual and
outlines a mining inventory base d on Inferred Mineral Resources . The term “run of mine (‘ROM’)
material” is used in the PEA to describe potentially economic Mineral Resource included in the mining
and processing plans. According to the PEA, a total of approximately 29.6 Mt of ROM material
averaging about 3.9 g/t Au is scheduled for an additional 17-year LoM based on the Inferred Mineral
Resources at Wassa underground (the Southern Extension), including 2 years for definition drilling
and 2 years for underground development.
– IIIC-232 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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The second design, developed using Deswik software and shown in  Figure 12-18, estimates a 26-
year mine life extending to 2049 with an annual mining capacity of approximately 3 Mt of ore, detailed
in Appendix B. This design includes the V13 Design, which is th e Ore Reserve plan and schedule,
employing a top-down LHOS method with either transverse or longitudinal stoping, depending on the
orebody, and using pastefill for backfill for deeper stopes. Th e stope optimization parameters align
with the Ore Reserve plan, except the gold grade for Inferred Mineral Resource is not set to zero.
Figure 12-18: Wassa Underground Life of Mine Design (Looking East)

Source: GSR
The main decline is a spiral ramp on both sides of the ore body , extending to -800 m RL, as shown
in Figure 12-19. However, during the discussions with GSR, it is suggested that a vertical shaft may
be developed for deeper ore extraction due to the extensive travel distance for material transport via
the decline.
– IIIC-233 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 12-19: Wassa Underground Life of Mine Decline Design (Looking East)

Source: GSR
12.2.11 Conclusions a nd Recommendations
SRK has reviewed the parameters for calculating cut-off grade, underground design, and schedules
provided by the Wassa Mine and concludes that there are no significant inaccuracies in the data or
procedures used.
It is important to highlight, however, that the Wassa Mine's ov erall design strategy is based on an
operational perspective, and ther efore Inferred Mineral Resourc es have been considered in the
development design. This could lead to unnecessary capital expe nditure if only Measured and
Indicated Mineral Resources were considered.
The Updated Wassa Design has included additional Indicated Mine ral Resource. Due to the time
limitations in preparing the design by the Wassa Mine , this inventory is considered to be at a scoping
study level. SRK would consider this inventory as an upper case  for eventual economic extraction
results.
– IIIC-234 –
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FOR THE WASSA GOLD MINE


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Ore Reserves estimation has been conducted based on the mine design (Wassa Design), previous
studies, and historical operating conditions. SRK suggests that  the Wassa Mine conduct an
independent study to compile such data to guide further production.
It is recommended to upgrade the Mineral Resource category in the B Shoot south deeps to extend
mine life through in-fill drilling exploration and/or underground exploration.
– IIIC-235 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Recovery Methods    Final
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13 Recovery Methods
13.1 Processing History
Wassa started exploiting gold from ores in 1998 utilising a hea p leach (“HL”) technology which is a
well-established extractive metallurgical technology enabling the economic processing of various
kinds of low-grade ores, which c ould not otherwise be exploited . However, the process remains
limited by low recoveries and long extraction times. The proces s involved crushing, screening and
agglomeration of the mined material before being stacked on leach pads which were irrigated with a
weak cyanide solution to recover the gold. The solution was pro cessed through carbon columns,
stripped from the loaded carbon and smelted through to gold Dor é bars. In 2001, the HL operation
was suspended since the actual plant recoveries of 55-60% were far below the design and expected
recovery of 85%, making the process non-economical.
A FS commenced to evaluate construction of a CIL plant in 2003.  The positive outcome led to the
construction of the existing plant in 2004 which was commission ed in 2005. The plant circuit has
crushing, milling and CIL sections with new facilities for the mills and CIL circuit in that upgrade. A
feed blend comprising 45% fresh material, 25% oxidized material  and 30% reclaimed spent HL
material was feed to the plant which had processing design capacity 3.5 Mtpa. Until 2014, the spent
HL material reclaimed from the pads was added to the mill feed via a scrubber when it was
exhausted. The plant was fed with only fresh material from the open pit until 2016 when underground
material was added to the feed. Open pit mining was suspended i n 2018 and since then, the
predominant feed has been underground ore with supplementary ad dition of open pit stockpiles
fresh, low-grade ore since 2021.
13.2 Process Description
The current plant circuit for G SWL is capable of processing up to 3.5 Mtpa of total mill feed but
processed 2.55 Mtpa against a target of 2.7 Mtpa in 2023. As at the end of March 2024, processing
stood at 0.72 Mtpa. The underground ore (fresh or competent ore ) is the major source of feed into
the plant whilst a blend of surface material may be added depen ding on availability in a ratio that
averaged at 87% and 13% for 2022 and 83% and 17% for 2023 respe ctively. The surface ore may
contain transition ore in addition to the oxides. Despite these  average blend ratios, there are also
periods that underground ore may be the sole feed into the plan t. The blending ratio is maximised
by the grade control to maintain recoveries at optimal levels t hroughout each year. The historical
production records indicated that the ratio of oxide to primary  has no obvious effect on the gold
recovery.
The process flow diagram is shown in Figure 13-1. The operation al circuit is made of the following
sections:
 Crushing and Milling Circuit
 Gravity Gold Circuit
 Leaching Circuit
 Smelting
– IIIC-236 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 13-1: Current Process Flowsheet for GSWL
13.2.1 Crushing and Grinding
The Run-Of-Mine (“ROM”) Pad receives ore from underground and surface via dump trucks such as
CAT 777 and Volvo trucks (ADT).
A Front-end Wheel Loader transfers the dumped ore into the ROM bin under the guidance of a grade
controller. An apron feeder underneath the ROM bin discharges t he boulders into a Grizzly feeder
that feeds a 150 mm Single toggle Jaw Crusher which is in an open circuit with series of Secondary
and Tertiary Cone crushers which are fed through a network of screens with specified apertures and
conveyors. Overall, eight (8) crushers are used in size reduction in the plant.
The tertiary screen is in closed circuit with the tertiary bin. Two weightometers are connected to the
set of conveyors (CV2 and CV10) to be able to quantify the crushed ore.
The particles with size -12 mm (P 80=8mm) are heaped at the crushed ore stockpile (“COS”)  which
has a space to store 18,900 tonnes of crushed ore but has a live stockpile of 4,400 t. Each of a pair
of conveyors (CV12 and CV13) carries 165 tonnes per hour (“tph” ) of crushed ore to feed a 5.03 m
diameter x 6.71 m long Ball mill each. Each of the Polymet lined mills is driven by a 3 MW motor and
uses a combination of 60 mm and 80 mm steel balls in a ratio of  2:1 as grinding media. The mill
product is about 70% passing 75 µm discharges into a hopper and is pumped into two sets of primary
– IIIC-237 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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cyclone cluster. Each cluster of cyclones has seven individual cyclones, each with their individual
inlet valves for each of control and maintenance.
Pressure swing absorption (“PSA”) oxygen plant located in the milling area.
13.2.2 Gravity Gold Extraction
One-seventh (1/7) portion of the cluster of cyclone feed is dir ected unto a scalping screen. The
undersize feeds two 48” Knelson Concentrators (“KC”). The combi ned concentrates are fed into
Concep Acacia CS 3000 Intensive Leach Reactor (“ILR”) and Electrowinning Cell for gold recovery.
This section accounts for between 28% and 30% of the total plant gold output.
The KC overflow discharges into the mill discharge hopper through a splitter box.
The Acacia Barren Solids (“ACBS”) and the ILR residue are pumped back into the mills splitter box.
13.2.3 Leaching
Both overflow streams of the combined primary cyclone overflows  are directed to another trash
screen to remove further traces of debris. The screen undersize discharges into two sumps each of
which feeds two secondary clusters of cyclones each with a 15% solids. The combined cyclone
overflow feeds a 25 m Pre-Leach High Rate Thickener into which are added flocculants for
dewatering purposes. The overflow is reused as the Ball mills water addition.
The thickener underflow is pumped by a 260 kW pump into a trans fer vessel together with the
secondary cyclone underflow wher e cyanide is added before the s lurry is transferred to the CIL
circuit. The year-to-date cyanide consumption rate is 0.48 kg/t against a budget of 0.44 kg/t. Oxygen
which is generated from the PSA is injected into the transfer line after the transfer pumps. The
transfer pipeline acts as an ILR, where most leaching occurs.
Six CIL tanks, each with a designed capacity of 2,500m 3 but a live volume of 2,250m 3 each
constitutes a train for counter-current leaching of gold and adsorption unto activated carbon.
The slurry residence time in the CIL tanks is 36 hours whereas the carbon has a residence time of
24 hours. The gold loaded carbon is pumped from the third tank to a vibrating screen to separate the
carbon from the slurry with water spraying washing. The washed loaded carbon is then transferred
to the storage silo above the top of the elution column.
13.2.4 Elution, Electrowinning, Smelting and Regeneration
The gold is desorbed during elution and the loaded carbon is acid washed and then stripped of gold
using caustic soda in an 11.5 t pressure Zadra elution system. Eluted carbon is thermally
regenerated and returned to the last stage of the CIL circuit. The carbon is regenerated in a kiln with
an operating temperature of 128℃ to 130℃ and a pressure of 220 kPa with a 12 tonnes quench
tank.
The solution gold then precipitated during electrowinning in th e gold house ahead of smelting. The
CIL circuit accounts for the remaining 71% of the total gold ou tput from the mine. The gravity gold
concentrate and electrowon gold are smelted separately to produce gold doré bars.
– IIIC-238 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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13.3 Production Performance
The historical production performance of the plant for the past  three years is shown in Table 13-1.
The actual ore throughput is 2.12 to 2.55 Mtpa against the target of 2.7 Mtpa. The overall gold
recovery including gravity and CIL is 95.3% to 97.1% with gold production of 4.84 to 5.31 tonnes per
year.
Table 13-1: Wassa Gold Plant Historical Production Performance
Parameter Unit 2020 2021 2022 2023 Q1-Q3 2024
Total Milled t 2,010,784 2,256, 725 2,117,237 2,550,842 2,300,19 8
Mill Feed Grade g/t 2.63 2.22 2.58 2.06 2.00
Mill Feed Gold kg 5,281 5, 001 5,469 5,248 4,606
CIL Feed Tonnage t 2,010,784 2, 256,725 2,117,237 2,550,842 2,30 0,198
CIL Feed Grade g/t 1.92 1.58 1.84 1.47 1.46
CIL Feed Gold kg 3,856 3, 566 3,900 3,760 3,368
Tails Grade (Measured) g/t 0.14 0.10 0.11 0.09 0.09
Gravity Gold Produced kg 1,411  1,386 1,589 1,474 1,236
CIL Gold Produced kg 3,803  3,448 3,721 3,548 3,061
Total Gold Produced kg 5,214 4,835 5,310 5,022 4,296
Gravity Recovery % 26.72 27.72 29.06 28.09 26.83
CIL Operational Recovery % 0 .00 68.95 68.05 67.60 66.45
Total Recovery % 98.74 96.67 97.10 95.69 93.27
Crusher Availability % 84.65  89.84 93.61 93.30 92.82
Mill Availability % 94.12 94.15 94.47 97.26 96.26
Mill Utilisation  % 91.76 81.31 76.11 89.08 99.17

13.4 Processing Facility
Wassa processing plant is a conventional CIL plant. Processing facilities include a ROM pad for ore
blending and grade control, a com plex crushing system, a crushe d ore stockpile pad, two parallel
grinding circuits with Knelson Concentrators, a standalone Accia intensive leach and electrowinning
room for gravity concentrate, a standard CIL circuit and loaded carbon process circuit.
The main equipment is detailed in the description of the plant flowsheet. Figure 13-2 shows same
facilities and equipment of the Wassa processing plant.
The crushing circuit is complex with four crushing stages, although performing normal function. If a
semi-autogenous (“SAG”) mill is used, the three-stage crushing after primary crushing can be
replaced. The crushing circuit will be simplified.
There are six agitation leach tanks for CIL currently. An addit ional two CIL tanks are planned to be
added to the existing tanks chain to extend the CIL time for enhancing gold recovery.
– IIIC-239 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 13-2: Photo of Wassa Processing Plant


Overview of Crushing and Grinding Primary Crushing and 2nd Screening
3rd Crushing and 3rd Screening
Grinding and Classifying
Accia Intensive
Leaching and
Electrowinning
Crushed Ore
Stockpile
Lime Silo
Pre-leach Thickener
Electrowinning
And Gold Room
Elution and
Regeneration
CIL

13.5 Proposed Changes to t he Treatment Circuit
 An additional two CIL tanks are expected to be added to increase recoveries and total gold output
following several successful test work studies that confirms this again in extended leaching.  The
expansion requires additional installation of a 2 tonne Oxygen plant to meet the demand.
 The expected Mill Expansion project will incorporate the isolation and modernisation of the gold
room by increasing the working space therein.
 Future metallurgical test works are to accompany the drilling p rogramme scheduled for 2024 in
expectation to meet the envisaged target of 3.5 Mtpa. However, the critical element is the
availability of ores yielding additional 2,000 tph to the current 7,000 tph.
 The metallurgical test works are envisioned to cost around US$ 0.2 Million.
 The technical studies have commenced and are in progress. These  findings have led to the
acceptance and approved extension of the leaching time in the plant circuit by building two new
CIL tanks.
 Considerations of the enhancement of the sustainability indicators for the mine through possible:
– IIIC-240 –
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FOR THE WASSA GOLD MINE


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– replacement of the secondary, tertiary and quaternary crushing units with SAG mill in order
to improve upon performance and also reduce cost
– haulage options for carriage of ore to the processing plant by using conveyor systems versus
usage of electric trucks to improve the carbon footprint
 The mine has an International Cyanide Management Code (“ICMC”) certificate since 2010.
13.6 Laboratories Tests
13.6.1 Wet Chemistry and Assay
Routine samples from the exploration (muck samples), grade control, processing unit points including
solid tailings samples are obtained for analyses.
Solid samples are crushed to obtain 74% passing 106 µm and then  pulverised to 90% passing
75 μm.
Loaded and eluted carbon gold contents are also assessed.
The routine analyses carried out cover the determination of gol d, silver, copper and some base
metals using fire assay and BLEG protocols.
Periodically, comparative round robin assessments are carried o ut on blind samples with SGS
(Tarkwa) and Intertek (Tarkwa). Preliminary data appear to compare very well.
QA/QC methods are followed which have also been certified by South African National Accreditation
Service (“SANAS”), South Africa.
13.6.2 Metallurgical Laboratory
Routine metallurgical plant simulation test works (crush test, grinding/ milling and bottle roll tests) are
carried out to determine head grade, reagents consumption and r ecoveries. The outputs compare
well with the plant performance, within acceptable limits.
The simulated outcomes are claimed to match well with similar o utcomes in a 2018 reference work
by the University of Mines and Technology, Tarkwa (“UMaT”).
An extended leach test works has proven and led to the approval  for additional two CIL tanks to be
added to the existing train.
The comprehensive metallurgical test works leading to an FS are  carried out by the company with
reference laboratories alongside drilling programmes.

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14 Project Infrastructure
14.1 Tailings Storage Facility
There were two TSFs, TSF 1 and TSF 2, designed to accommodate t he anticipated tailings
produced. TSF 1 was stage-constru cted with the most recent rais e, Stage VI, in 2014, and it was
raised to 1,039 m RL. The starter embankment was constructed in 2004. The raising of TSF 1 was
to provide sufficient storage capacity until 2017 when TSF 2 was scheduled to be operational.
TSF 1 is located northwest of the processing plant at the head of a southerly draining valley and
immediately adjacent to the historical leach pad area. The ground levels range from 1,000 m RL on
the valley floor to above 1,060 m RL on the surrounding hills. It is a cross-valley impoundment
created by the construction of a main embankment in the south with confining saddle embankments
at the north of the facility. Containment to the east and west is provided by natural ridges. Access is
via unsealed road west of the plant site area. The catchment ar ea of TSF 1 is estimated to be
approximately 140 Ha, of which 124 ha is covered with tailings as the facility proceeds through
closure revegetation trials. Deposition into TSF 1 ceased in 2019 with paddock deposition completed
to achieve the approximate closure surface topography requireme nts of the closure landform. Re-
vegetation trials commenced in 2017 towards the next land use, and by the end of 2020, the
revegetation planting was almost  complete. TSF 1 has been repla nted with palm oil trees under a
scheme operated by Golden Star Oil Palm Plantation (“GSOPP”). The palm trees are growing well,
and farm workers are harvesting the fruits as in Figure 14-1.
Figure 14-1: Reclaimed TSF 1
Reclamation TSF 1
Palm Fruits Harvesting in TSF 1

TSF 2 is close to TSF 1 in the valley that extends eastward from the north embankment of TSF 1. It
is approximately 2.5 km from the processing plant and 1.3 km downstream of TSF 1 Saddle Dam 5.
TSF 2 has a footprint of 260 ha, of which 72 ha has been develo ped to date, and lies within a total
project area of 340 ha including the buffer zones. The remainin g capacity of TSF 2 significantly
exceeds the needs for processing of ore defined by the Ore Reserves, even after allowing for use of
tails solids for paste backfill.
The TSF 2 has two cells currently with the first cell (TSF 2 Cell 1) under care and maintenance, and
the secondary cell (TSF 2 Cell 2) in use and being filled. A sa fety audit report for 2022 issued by
Geosystems Consulting Limited stated that the section is generally in compliance with the regulatory
and design requirements. A third cell (TSF 2 Cell 3) is under geotechnical investigation by Knight
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Piesold Consulting Limited (“KP”). The configuration of the three cells is as Figure 14-2. It is planned
that the three cells will merge together in the future to enlar ge the volume and for reclamation
purposes.
The TSF 2 basin was to be entirely lined with high-density polyethylene (“HDPE”) sheets and was to
provide a storage capacity of 41 Mt by staged construction up to Stage 6, although only 19.5 Mt was
required for the LOM at the time. It is designed as a downstream embankment, and future raises are
planned to be downstream as well. All embankments are designed with 1V:2H upstream and 1V:3H
downstream slopes, with 8 m wide crest. It is envisaged that the facility will be developed as follows:
 Cell 2 – Stages 1 to 3 through years 1, 2 and 3;
 Cell 3 – Stage 4 at year 4;
 Cell 1 – Stages 5 and 6 at years 5 and 6; and
 Cells 1 and 3 – Stages 7 to 11 through years 7 to 11.
Figure 14-2: TSF 2 Cells
TSF 2
Cell 1 Cell 2 Proposed Cell 3

GSWL has an on-site tailings management team that takes care of  the day-to-day activities at the
TSFs. The Environmental Department oversees the water quality testing at the TSFs. KP conducts
quarterly TSF inspections and a consultancy named Glocal Engineering in Ghana conducts quarterly
independent reviews. Geotech Systems conducts an annual safety audit.
There is currently no detoxification plant at GSWL. However, mi ne personnel report that this does
not hamper the TSF operation as the general water balance on th e mine is negative. Occasionally
when excess supernatant water must be pumped off the TSF, a lin ed holding pond with 200,000m3
capacity is used for storage. The holding pond was part of the former Heap Leach facilities. The
stored supernatant water is ultimately used by the treatment plant. The use of this holding pond has
enabled GSWL to continue to operate the TSFs without dischargin g contaminated water into the
environment.
The new Global Industry Standard on Tailings Management (GISTM)  is yet to be implemented at
GSWL.
14.2 Water Supply
The processing plant has a negative water balance and therefore does not discharge process water
into the environment. However, it reuses the dam return water (current TSF 2) for processing whilst
part of the underground dewatering section is pumped to the plant as supplementary raw water. The
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rest of the underground water is used to suppress dust in the mine environment, and also utilised in
the Backfill Paste plant.
There are two surface ponds in the mine area to collect and store the surface water and groundwater
for processing plant supplement, mining and dust depression. Th e ground water comes from the
mining section. Figure 14-3 shows the two catchment ponds. The 2nd pond is adjacent to the Genser
Generator, and the water is also used as cooling water of the Generator.
Figure 14-3: Catchment Ponds in Wassa Mine Site

14.3 Power Supply
There are two sources of electri city, the National Grid of Ghan a (“GRIDCO”) and Genser Energy.
The Genser generator is in the vicinity of Wassa mine. GSWL has  the objective of providing a
continuous, stable and cheaper supply of power. Genser Energy m eets GSWL’s monthly average
need of 14.2 MW power. Genser Energy produces its power from natural gas and sells the power to
GSWL at US$0.11/ kWh. It has an installed capacity of 23-24 MW with additional space to add
another system. GSWL currently uses GRIDCO power as an alternat ive source of power for its
operations.
It is planned to set up a 1 MW solar power plant to supply cheaper energy to offices and living areas,
but SRK didn’t get the details. Figure 14-4 is a photo of the m ain transformer station between the
mine offices.
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Figure 14-4: Main Transformer Station

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15 Market Studies and Contracts
15.1 Market Studies
All gold product from the Wassa Project is shipped to a South A frica based gold refinery under a
long-term sales contract. Shipping is in the form of gold doré bars, which average approximately 90%
gold by weight with the remaining portion being silver and othe r metals. The sale price is generally
set with reference to the London p.m. fix on the day of the shipment to the refinery.
SRK has used a fixed gold price of US$2,050/ oz for cut-off gra de calculation and the technical
economic analysis for the Wass a Mine. Table 15-1 shows the pric es trend and long-term price for
Gold from Deutsche Bank, which issued in April 2024. The commod ity price forecast is considered
to reflect a reasonable outlook for the future.
Table 15-1: Gold Price Forecasts
Year 2021 2022 2023 2024 2025 2026 Long-term
Price
Gold
Price 1,800 1,798 1,940 2,025  2,100 2,141 2,050
Source: Deutsche Bank
15.2 Contracts
SRK has not reviewed any contracts relating to the product mark et, and SRK is aware of gold is a
freely traded commodity on the world market and whilst the selling price is subject to fluctuation, and
the volume of gold produced at W assa will not be material to th e supply/ demand balance and will
not influence the selling price.
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16 Environmental Studies, Permitting, and Social or
Community Impact
16.1 Environmental and Social Review Objective
The objective of this due diligence review is to identify and/o r verify the existing and potential
environmental, social and occupational safety liabilities and r isks, and assess any associated
proposed remediation measures for the Wassa Project.
16.2 Review Process, Scope and Standards
The process for the verificati on of the environmental complianc e and conformance for the Project
comprises a review and inspection of the project’s environmental management performance against:
 Ghanaian national environmental regulatory requirements; and
 Equator Principles (World Bank/ In ternational Finance Corporati on (“IFC”) environmental
standards and guidelines) and internationally recognised environmental management practices.
The methodology applied for this environmental review of the Pr oject consists of a combination of
desktop review and interviews with GSWL technical representatives.
16.3 Relevant Legislation and Required Approvals
The mineral and mining sector between 1986 and 2005 was governe d by the Minerals and Mining
Law, 1986 (P.N.D.C.L. 153) and this was the basic mining legislation in Ghana. While it was regarded
as the trendsetter in terms of mining legislation in Sub-Sahara n Africa, major changes in the
international mining sector led to its revision. After a protracted review in the early 2000s, the current
Minerals and Mining Act, Act 703 of 2006 became the governing legislation for the country’s minerals
and mining sector.
The Minerals and Mining Act, 2006 (Act703) , and its related mining regulations and other relevant
regulations such as the Environmental Assessment Regulations, 1999, L.I 1652 and mining–related
guidelines and standards constituted the legal framework and regulations for the mining sector.
16.3.1 Permitting Re quirements in Ghana
Environmental Assessment Requirements
The Environmental Protection Agency (“EPA”) Act, 1994 (Act 490)  established the authority,
responsibility, structure and  funding of the EPA. Part 2 of the  Act mandates the EPA, with the
formulation of environmental po licies, issuing of environmental  permits and pollution abatement
notices and prescribing standards and guidelines.  The Act defi nes the requirement and
responsibilities of the environmental protection inspectors and  empowers the EPA, to request that
the EIA process be undertaken.  The EIA process is legislated t hrough the Environmental
Assessment Regulations, 1999 (L.I. 1652) , which is the main legal framework used by EPA, for
regulating and monitoring mineral operations which cover requirements for:
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 Environmental Impact Assessment (EIA);
 Preparation of Environmental Impact Statements (EIS);
 Environmental permitting;
 Environmental Management Plan (EMP); and
 Reclamation bonding.
The EPA grants environmental approval to all undertakings through an Environmental Permit, which
is issued subject to the submission of a well-documented Enviro nmental Impact Statement. For a
mine, an EIS must include a reclamation plan and a provisional EMP. Prior to formal review by the
EPA, the EIS may be subject to public exhibition and hearing, w ith responses from regulators and
community to be incorporated into the EIS before an Environmental Permit is granted.
Two years from receipt of an Environmental Permit, an Environmental Certificate is required from the
EPA to confirm:
 Acquisition of all permits and approvals;
 Compliance with mitigation commitments in the EIS and/or EMP; and
 Submission of annual Environmental reports.
Within 18 months of commencement of work an EMP is to be submitted to and approved by the EPA.
The provisional EMP in the EIS is updated and incorporated into  the mine’s active EMP which is
subjected to update every three years renewal cycle. Reclamation plans are a necessary document
for all mines in Ghana ( Regulation 14 of L.I. 1652 ) and mining operations submit annual
environmental reports ( Regulation 25 of L.I. 1652 ) and monthly environmental quality monitoring
results to EPA, with notes where values exceed thresholds and response plans as required.
Minerals and Mining Requirements
Act 703  establishes laws on the proces s for obtaining mineral rights, the administration and
management of these rights and protection of the environment. Supporting Act 703 are the Minerals
and Mining Regulations, 2012 which cover:
 General aspects (L.I. 2173);
 Compensation and resettlement (L.I. 2175);
 Explosives (L.I. 2177);
 Support services (L.I. 2174); and
 Health, safety and technical requirements (L.I. 2182).
Water Resource Legislation Requirements
The Water Resources Commission Act, 1996 (Act 552)  establishes the Water Resources
Commission as a body corporate, responsible for the regulation, management, and coordination of
policies related to water resources. Key functions include developing water use and conservation
plans, granting water rights, coordinating water resource devel opment and utilisation, and advising
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on water pollution control. Additionally, the Water Use Regulatio ns, 2001 (L.I. 1692) , and Drilling
Licence and Grou ndwater Development R egulations, 2006 (L.I. 1827) , complement the Act by
specifying the requirements for obtaining permits for water use, water rights, and priorities for water
use; and water drilling licences, and well construction requirements; respectively.
16.3.2 Status of Environmental Approvals and Permits
In accordance with the Environmental Assessment Regulations, 1999 (LI 1652), Regulation 25, as
well as Articles 28 to 30 of the Minerals and Mining (Health, Safety and Technical) Regulations, 2012
(LI 2182) and the conditions of the GSWL Environmental Certific ate and various Environmental
Permits, GSWL is required to submit an Annual Environmental Rep ort initially twelve months after
the start of operations and thereafter, every calendar year.
In addition to the Annual Environmental Report, GSWL is required to submit an EMP after 18 months
from the commencement of operations, and thereafter every 3 years. Based on the EMP 2022-2025
and Annual Environmental Report 2023, the key environmental approvals held by GSWL are
summarized in Table 16-1.
Table 16-1: Key Environmental Approvals Obtained for Wassa Mine
Approval Permit No. Date of Issue Expiry Date Comments
Environmental Permit to
pursue operations EPA/EIA/112 18-Mar-2004 None
Based on Wexford Goldfields
Limited Wassa project EIS
(2004)
Gold Mining Project at
Mpohor EPA/EIA/175 24-Feb-2006 None
Issued to St Jude Resources
(Ghana) Limited based on
Hwini Butre EIS and Subriso
EIS
South Akyempim
Environmental Permit EPA/EIA/190 2-Jun-2006 None Based on EIS on South
Akyempim Project (2005)
Hwini Butre / Benso
Project Environmental
Permit
EPA/EIA/247 2-Oct-2007 None Based on the Hwini Butre and
Benso EIS (2005)
Wassa Pits Expansion
Project Environmental
Permit
EPA/EIA/322 20-Dec-2010 N/A Based on Wassa Pits
Expansion EIS (2010)
TSF 2 Environmental
Permit EPA/EIA/383 5-Apr-2013 N/A
Based on corresponding EIS
(2013); Transitioned to
EPA/EIA/442
TSF 2 (re-design)
Environmental Permit EPA/EIA/442 25-Nov-2015 N/A  Based on TSF 2 EIS (2015)
Wassa Expansion Project
Environmental Permit EPA/EIA/508 30-Oct-2017 N/A  Based on Wassa Expansion
EIS (2016)
Environmental Certificate EPA/EMP/278 Dec-2022 Dec-2025 2022-20 25 EMP
GSWL operates under Environmental Certificate EPA/EMP/278 issued on 22nd December 2022. The
Environmental Certificate for the EMP 2022-2025 expires in December 2025.
SRK also reviewed eight copies of water use permits for the Wassa mine, covering domestic
purposes, pit dewatering, processing, mining, and dust suppression. All permits are currently within
their valid periods.
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In this environmental review, SRK viewed the following documents on the environmental and social
impact assessment of the Project:
 Draft Environmental Impact Statement on Wassa Expansion Project  (“Expansion Project EIS”)
dated March 2016 and its approval;
 Environmental Impact Statement on Updated TSF 2 Project (“TSF 2 EIS”) dated September 2015
and its approval;
 Environmental Management Plans for Surface and Underground Operations (2022-2024) and its
approval;
 Annual Environmental Reports (2021, 2022, and 2023);
 NI 43-101 Report for the Golden Star Wassa Mine Project Akyempi m Ghana dated April 2023
(2023 NI 43-101 Report); and
 Other related documents.
SRK viewed the above EIS reports, and concluded that the Wassa Mine prepared the EIS reports in
accordance with the relevant laws, regulations and decrees of Ghana. In the following sections, SRK
provides comments in respect to the study and management measur es from the EIS reports and
other related documents.
16.4 Environmental and Social Aspects
16.4.1 Ecological Impact
Based on the EIS reports, comprehensive baseline studies were carried out in Wassa during 1996,
2010, and 2012. Wassa is situated in a region transitioning bet ween moist, semi-deciduous forests
and wet rainforest zones. Initial observations highlighted vegetation degradation due to impacts from
logging and farming. The studies  recorded 73, 214, and 70 floral species in the years 1996, 2010,
and 2012, respectively. A 2016 review by the International Union for Conservation of Nature (IUCN)
identified Tieghemella heckelii as endangered and listed severa l species as vulnerable, including
Mitragyna stipulosa, Turraeanthus africanus, and Guarea cedrata, among others. Additionally, three
species identified at the Genus level in the baseline studies —  Terminalia, Entandrophragma, and
Pterocarpus sp — may have updated conservation statuses due to their overexploitation for timber
and other uses. The Wassa project also includes a haulage route (12 km of the Hwini Butre Benso
access road) that traverses the Subri River Forest Reserve, how ever, the Globally Significant
Biodiversity Area within the Subri River Forest Reserve is not impacted by the road based on the
Project Expansion EIA.
Baseline studies in the project area have documented a diverse array of fauna, including small and
large mammals, bats, birds, bu tterflies, herpetofauna, amphibia ns, and aquatic species.
Indiscriminate hunting and clearing of forest for agricultural purposes have both played major roles
in causing the decline and extinction of wildlife species in th e area. The 2016 IUCN classifications
highlight several notable species and their conservation statuses: the Hooded Vulture (Necrosyrtes
monachus) is critically endangered, facing threats from indiscriminate poisoning, traditional medicine,
hunting, and persecution. The Hinge-back Tortoise (Kinixys homeana) and the African White-bellied
Pangolin (Phataginus tricuspis) are classified as vulnerable. T he Grey Parrot (Psittacus erithacus),
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also vulnerable, is primarily threatened by the international p et trade. Additionally, the Pohle’s Fruit
Bat (Scotonycteris ophiodon) is listed as near threatened, and the Pel’s Flying Squirrel (Anomalurus
pelii) was considered near threatened in 1996 but has since been updated to data deficient, indicating
a need for more current data to assess its status accurately.
 SRK reviewed the EIS reports and EMPs of the project, and the EIS pointed out the main impacts
of the project construction, operational, and decommissioning/ closure phases on terrestrial and
aquatic organisms, and measures to reduce these impacts. SRK be lieves that the ecological
protection measures, such as establishment of seed banks, progressive revegetation, vehicle speed
controls, etc. mentioned in the EIS reports and EMPs are reason able and feasible, but SRK also
recommends that the ecological baseline study of the project in  the EIS should include on-site
surveys of multiple seasons to assess the local ecological environment status more comprehensively.
Furthermore, in addition to the protection measures mentioned in the EIS and EMPs, methods, such
as the establishment of biological corridors, restoration of habitats, and implementation of biodiversity
compensation, can be adopted to reduce the impact of project on ecological environment.
16.4.2 Water Management
The GSWL mining concessions are located within the Pra River Basin, one of three major river basins
in southwestern Ghana. The Wassa concession area is drained by the Toe, Kubekro, and Petetwum,
which are tributaries of Pra. The Benso concession is near the Ben River and a stream informally
called the “Subri River”. The Hwini Butre concession lies in th e Butre River catchment area and is
drained by streams such as the Pamaa, Besama, and Whanawhana.
The project’s drinking water comes from boreholes. In 2023, 18 out of 31 monitoring boreholes at
Wassa served as sources of drinking water for Tara Camp, Camp II, the mine site, and surrounding
communities. The remaining boreholes were for monitoring at the TSFs. At HBB, 3 out of 8 monitoring
boreholes served as sources of drinking water for the Benso residential site and the HBB mine site,
while the others were for monitoring at the G-Zone open pit. Drinking water boreholes at Wassa and
HBB are monitored monthly for Escherichia coli, total coliform, and fecal coliform bacteria. A quarterly
disinfection program was carried out for all community drinking water boreholes as part of the GSWL
community outreach programs.
Service water for mining and supplementary raw water for the processing plant comes from open pit
dewatering. Water is pumped from the Starter Open Pit sump to t he processing plant via a settling
sump to augment supply during the dry season, combined with return water from the TSF to minimize
groundwater extraction. In the first three quarters of 2024, 141,048 m³ of open pit water was reused
at the processing plant. Water for dust suppression typically c omes from raw water along the haul
road and open pit dewatering, totalling 76,175 m³. All open pit  water usage, dewatering discharge,
and water used for dust suppression  were well below the permitt ed volumes specified in the water
use permit.
SRK recommends that the project should implement a sustainable water supply management plan
to minimize its impact on natural systems through the management of water use, avoid the depletion
of aquifers, and reduce the impact on water users. Meanwhile, GSWL shall consult with major
stakeholders (i.e., government, civil society, and potentially-affected communities) to learn about any
conflicts that may arise from wa ter use requirements, community dependence on water resource,
and/ or existing local protection requirements.
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Routine analyses of cyanide and nitrates in surface waters were  undertaken at selected sites. Free
cyanide is analysed bi-weekly, whilst Weak Acid Dissociable (“W AD”) and total cyanide analyses
were completed monthly. All GSWL surface water monitoring locations are within the EPA guidelines
for free, WAD and total cyanide. All cyanide concentrations wer e less than their method reporting
limits of 0.005 mg/L.
The water quality monitoring programme at Wassa includes monitoring of water in boreholes, surface
water, TSF supernatant pond, and seepage wells. The water quali ty results obtained showed no
notable variations from the baseline conditions, although elevated total suspended solids (TSS) were
detected on a few occasions at some sites, due to illegal mining. Piezometers located in the vicinity
of the Father Brown open pit at Hwini Butre are monitored monthly.
Based on the EIS reports, the groundwater and hydrogeological impact assessment showed that the
project has limited potential fo r impact on groundwaters; the h ost rock is highly impermeable and
leachate qualities are good. As a result, impacts of dewatering  are highly localised to the mining
areas and are not expected to have any effect on existing commu nity groundwater supply sources,
and groundwater levels will substantially recover at closure, a nd without impact to the receiving
environment.
The main wastewater pollution of the Wassa Project may be derived from open pit dewatering water,
processing wastewater, TSF return water, waste dump/ ore stockpile leaching water, machine repair
wastewater, industrial site ra inwater, and domestic sewage. Sew age from the mine site and
residential areas is removed by a third-party contractor for disposal at a designated area close to the
TSF at Wassa, and to Subriso West at Benso and treated. A stream diversion around the processing
plant and administration area, TSF drainage diversions, and a F rench drain are set up to prevent
water inflow to the southern end of the Main open pit area. Add itionally, secondary drainage works
are in place around the site to direct water runoff from dumps and roads away from active mining
areas or toward dewatering infrastructure. Supernatant water fr om the TSF is pumped back to the
processing plant for use as process water. Regular monitoring of surface waters in the vicinity of the
TSF embankments is carried out to check for any potential discharge.
16.4.3 Waste and Tailings Management
The waste rocks from the Underground and Surface operations of Wassa are transported to the 419
dump. Sections of the dump are c urrently on 1,040 m RL and 1,030 m RL on the west while the
eastern stretch is on 1,020 m RL and 1,010 m RL. As part of waste management for economic value,
part of waste rock was recycled as aggregates for construction and road works. The waste dump is
continuously monitored according to relevant environmental requ irements. For specific information
on waste rock output and the waste dump, please refer to the mining chapter.
One potential risk to the environment from waste rock and TSF is acid rock drainage (“ARD”), that is
created when reducing sulphide minerals are exposed to air, precipitation and bacteria and, through
an oxidation reaction, produce sulphuric acid, during mining, transportation, processing, waste rock
discharge, and tailings storage, etc. ARD has the potential to introduce acidity and dissolved metals
into water, which can be harmful to surface and groundwater. A comprehensive ARD experiment can
help the Company predict problems and avoid long-term environmental risks.
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According to the EIS, the geochemical characterization was unde rtaken to determine the acid rock
drainage/metal leaching potential of ore and waste rock litholo gies. Classification of acid rock
drainage potential showed that all previous rock samples from the different open pits and waste rock
dumps were not acid generating (NAG). Additionally, acid base a ccounting of rocks to be mined in
the future mine development, demonstrated that the geochemical characteristics continue at depth,
with limited to no potential for ARD. Synthetic precipitation l eaching procedure (SPLP) and NAG
leach tests, a worse case indication of drainage quality, indicate that underground mine drainage is
likely to be neutral to alkaline with no constituents expected to exceed the EPA guidelines.
Furthermore, on the studies conduc ted for the EIS, GSWL continu es to assess the geochemical
characteristics of the ore, waste and tailings materials annual ly. These assessments consistently
demonstrate a low potential for acid generation.
The Wassa project includes two TSFs. TSF 1 is currently under maintenance, while TSF 2 is actively
used for tailings discharge. During operation, tailings are dis tributed via a HDPE pipeline, and the
TSF 2 basin is lined with HDPE sheets to meet the regulatory requirement. For detailed information
on tailings emissions and the TSFs, refer to processing (Section 13) and TSF (Section 14.1). A series
of environmental protection measures are in place, including a spillway, decant barge, secondary
confinement, and groundwater drains for containment. As part of GSWL’s environmental monitoring
plan, regular monitoring of water quality within the catchment of the mine’s TSFs is carried out to
ensure early detection of impacts on water resources due to the  operations of the TSFs and its
ancillary facilities.
16.4.4 Air and Noise Pollution
The dust emission sources of the Project mainly come from open pit mining, blasting, loading and
unloading, ore stockpile, crusher, waste dump, topsoil dump, TS F, and movement of vehicles and
mobile equipment. The project carried out monthly monitoring of  air quality for inhalable particulate
matter (“PM10”) and total suspended particulate (“TSP”). In 2023, all the communities monitored were
within the EPA guidelines of 70 μg/m3 and 150μg/m3 for PM10 and TSP respectively. However, the
expansion project EIS reported based on the history monitoring data that periodic seasonal peaks
exceed the guideline, as the seasonal Harmattan brings dry and dusty winds from the Sahara across
West Africa. Consequently, the operations have employed an array of dust suppression mitigations
throughout dry season conditions. Besides, SRK suggests adding the monitoring of PM2.5, which is
in line with current international industry practice. Moreover, SRK notes that the EIS did not address
the management of greenhouse gas (GHG) emissions, which is requ ired by some international
standards. In the 2023 Environmental Monitoring Report, GSWL pr ovided data on electricity
consumption and total direct CO 2 emissions, calculated from the total amount of diesel used eac h
month. However, this approach does not provide a comprehensive calculation of GHG emissions,
as it excludes indirect emissions from electricity use and othe r potential sources of GHGs, such as
fugitive emissions from mining activities and emissions from th e transportation of materials and
personnel. SRK proposes conducting research on the energy consumption coefficient per unit output,
GHG emission levels, and intensity.
The main noise emissions of the Project are from mining equipment, blasting, crushing and screening
equipment, various types of pumps, fans, vehicles and mobile ma chinery equipment. During the
noise status monitoring conducted for the EIS, the ambient noise of the project site was rarely
exceeded the EPA guidelines, which was caused by the church worship activities, animals, vehicular
– IIIC-253 –
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FOR THE WASSA GOLD MINE


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movements, and the operation of  machines in the community. The noise levels peaked in the
evening, as a result of increased noise from wildlife towards s unset. Mining-related noise, such as
truck movements and waste rock dumping, was periodically audibl e at this time. In 2023, all blast
events at Wassa were monitored in the Akyempim and Kubekro comm unities. Out of 1,263 blast
events and 2,723 monitoring readings, 52 blasts (0.59%) recorde d air blast values above the 117
decibel (“dB”) limit, and 9 blasts (0.003%) resulted in ground vibration levels greater than 2 mm/s.
Measures have been put in place by the Technical Service Department to mitigate this by considering
the amount of explosive used, number of holes, hole depths, and pattern size. GSWL has developed
and implemented an atmospheric and noise monitoring plan.  SRK believes that the air and noise
pollution management measures proposed in the project EIS and EMPs are reasonable and feasible.
It is recommended that the project shall implement the above measures during operation.
16.4.5 Hazardous Materials Management
Hazardous materials have the characteristics of corrosive, reactive, explosive, toxic, flammable and
potentially biologically infectious, which pose a potential risk to human and/or environmental health.
The hazardous materials will be generated mainly by the project’s construction, mining, processing
and include of hydrocarbons (i.e. fuels, waste oils, and lubricants), processing reagent, chemical and
oil containers, batteries, medical waste, and paint.
The Wassa explosives magazine, managed by AEL, is located in the backfilled Mid-East 1 open pit.
Blasting for both underground and open pit operations is conduc ted by AEL under contract and
overseen by GSWL to ensure compliance with Explosives Regulation LI 2177. In addition, hazardous
materials such as diesel and mineral processing chemicals will be stored on the project site. The
handling, storage and transportation of hazardous materials shall prevent leakage, overflow or other
accidental discharge into soil, surface water and groundwater. Solid waste generated is
predominantly managed onsite using a 10 m3 semi-automated incinerator, a landfill site, a land farm
and a scrapyard. Empty cyanide bo xes/ plastics are dismantled a nd treated offsite. All waste oil
generated by the operations is removed from site for recycling and disposal by a sub-contractor.
During the site visit, SRK observed that the processing reagents are stored on a cement surface and
secured with locked fences. SRK suggests taking measures to mit igate the risk of pollution caused
by leakage, such as second containment facility, double-layer or thickened pipelines at key locations,
shut-off valves to reduce spillage and avoid flowing into key a reas. GSWL is a member of ICMC.
Eagle Environmental Inc. conducted the most recent certification audit in April 2023.
16.4.6 Occupational Health and Safety (“OHS”)
A well-developed and comprehensive safety management system com prises site inductions, site
policies, safe work procedures, training, risk/hazard managemen t (including signage), use of
personal protective equipment ( “PPE”), emergency response process, incident/accident reporting,
an onsite first aid/ medical centre, designated safety responsi bilities for site personnel and regular
safety meetings, and a work permit/ tagging system, etc. SRK reviewed the occupational health and
safety plan in EMPs, Policy on Health, Safety and Wellbeing, Emergency Response Plan, and Health
and Safety Management System, and concluded that the development of these plans complies with
relevant Ghanaian requirements.
– IIIC-254 –
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FOR THE WASSA GOLD MINE


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During SRK’s site visit, it was observed that safety signs were  in place and safety provisions and
rules were also displayed within the work areas, moving machine ry parts were appropriately
protected and covered, guard railings were installed on all gan tries, and proper PPE was provided
and being used by the workers, such as hardhats, reflective safety vest, dust masks, earplugs, and
steel-toed shoes. The company has provided SRK with a historical OHS records for the project. No
fatal accidents have occurred in the past three years.
16.4.7 Environmental Protection and Management Plan (“EPMP”)
The purpose of an operational Environmental Protection and Management Plan (“EPMP”) is to direct
and coordinate the management of the project’s environmental ri sks. The EPMP documents the
establishment, resourcing, and implementation of the project’s environmental management
programs. The site environmental performance should be monitore d and feedback from this
monitoring could then be utilized to revise and streamline the implementation of the EPMP.
SRK notes that EMPs for surface and underground operations at W assa Mine were developed for
2022-2024, and an Environmental Certificate was issued based on these EMPs. The EMPs include
the policy, environmental impact and management, occupational health and safety plan, program for
meeting environmental requirements, reclamation and decommissio ning plan, and environmental
action plan with a monitoring program. In the first three quart ers of 2024, the monitoring of
groundwater quality, surface water quality, air quality, noise and vibration, soil quality, and ARD
testing, among other parameters, was carried out for the Wassa project.
16.4.8 Mine Closure Plan and Rehabilitation
Closure management is a key component of the overall business a ctivities of GSWL. Closure
management is integrated in all phases of mine life, from conce pt, exploration, and project
development through to operations, closure, and post-closure ac tivities. Closure aspects are
integrated into project-level EIS and environmental permitting processes. Reclamation security
agreements (RSAs) are negotiated with the EPA to establish mine closure completion requirements
and to establish long-term closure costs. Closure costs are estimated using conventional reclamation
sequences, expected agreed-upon post-mining land uses, and prev ailing operating and contractor
rates that incorporate in-country inflation costs. Based on the cost estimates, the company posts
security with the EPA to help ensure that all closure costs are accounted for. The security is returned
to the company once the site has been reclaimed to agreed-upon levels and there are no ongoing
monitoring and maintenance requirements.
SRK reviewed a Decommissioning Plan and Associated Asset Retire ment Obligations by Golder
Associates, dated June 2015. The total rehabilitation and closu re cost was estimated at
approximately USD 27 million, covering the infrastructure, mining areas, general surface reclamation,
water management, post closure activities for Wassa, Benso and Hwini-Butre concessions. However,
this estimate did not include TSF 2 and the expansion project. Over the years, GSWL has
rehabilitated an area of 419.67 hectares, while the total distu rbed area on the mining lease was
990.43 hectares as of September 30 2024. The Environmental Permit and EIS require a reclamation
bond to be posted within one year of commencing operations. The initial reclamation bond for Wassa
was posted in November 2004 and has been updated periodically a s new projects or changes are
approved. SRK viewed a copy of the bank guarantee of USD 144,44 1,629 for the Wassa
– IIIC-255 –
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FOR THE WASSA GOLD MINE


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Environmental Studies, Permitting, and Social or Community Impact  Final
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rehabilitation and reclamation dated 14 June 2023. Rehabilitati on and closure of the existing
operations, including the processing plant, TSFs, open pit excavations, waste dumps, and transport
routes, are covered under the EMP, Reclamation Security Agreement, and the associated bank
guarantee (bond). Two years before mine closure, the final rehabilitation and closure plan should be
prepared and submitted to the EPA.
16.4.9 Social Aspects
The Wassa Mine is in the Wassa East District of the Western Reg ion of Ghana, and is 62 km north
of the district capital Daboase, 35 km northeast of Tarkwa and 40 km east of Bogoso. The District
was separated from Wassa Fiase Mpohor District in 1988 and occu pies an area of 1,880 km 2
(464,553 ha) of which 344 km 2 and 85,000 ha are used as cultivable land. The population of t he
District according to the 2021 population and housing census st ands at 99,641 with 51,200 males
and 48,441 females (GSS 2021). The project vicinity is predomin antly rural and there are no large
urban settlements within a 50 km radius by road. The villages o f Akyempim, Akyempim New Site,
and Kubekro are the closest communities to the Wassa mine. Historic gold workings are also known
to occur in the lease area but are on a relatively small scale.
Based on the 2023 NI 43-101 Report, GSWL applies the requiremen ts of the International Finance
Corporation, Performance Standard 5 for land acquisition and in voluntary resettlement. Where
physical, social and/ or economic displacement is anticipated, if compensation is required for future
operations this is done in accordance with applicable laws, and  GSWL Farm Compensation and
Land Acquisition procedures. Previous application of these proc esses has shown that resettlement
can be achieved with positive out comes, evidenced most recently  with the resettlement of the
Togbekrom community to Ateiku in 2013. Stakeholder meetings and  consultations are periodically
held with leadership of Awunakrom, Pretea Ridge and Togbekrom r esettlement communities. The
agenda basically focuses on post resettlement issues, socio-eco nomic programmes and general
concerns.
The EIS included a stakeholder consultation programme, which id entified 10 key stakeholders,
including government regulatory agencies, government agencies, traditional leadership and
communities. GSWL cultivates strong relationships, foster peaceful coexistence, and highlight the
value-adding potential of key stakeholders. This is achieved through a well-organized three-tier
stakeholder engagement plan, allowing active participation in d ecision-making on community
concerns and needs.
Most predominant socio-economic concern of stakeholders who live within local communities around
the mine site is employment, where working at the mine is viewed as a preferred occupation. GSWL
over the years have provided employment through direct employment and through Corporate Social
Responsibility (CSR) projects such as GSOPP and Golden Star Ski lls Training and Employability
Program (GSSTEP). GSWL implemented a variety of targeted initiatives to support community skills
training, development, and employability.
In the first three quarters of 2024, the company successfully implemented its CSR as planned and
the strategies adopted included but not limited to the following:
 Teachers’ quarters at Kubekro, Accra town, and Odumasi communities
 Community center at Juabeng community
– IIIC-256 –
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FOR THE WASSA GOLD MINE


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 12-seater WC facility at Kubekro community
 Expansion of GSOPP plantations by 34 hectares
In the first three quarters of 2024, the direct GSWL related co rporate social res ponsibility funding
amounted to an investment of approximately US$ 278,214 in their host communities.
GSWL maintains a grievance mechanism enabling catchment communi ties to document concerns
and grievances for investigation and/ or action. The mechanism is well publicized by GSWL and used
actively by the community and other stakeholders. Details of re gistered grievances and resolutions
are recorded and reported internally and to the regulators. SRK  viewed a complaint register for the
first three quarters of 2024, and a total of 8 community complaints were recorded. Complaints range
from false allegations of cable theft tarnishing reputations, r educed salaries for employees, trainee
grievances, mistreatment of youth apprentices, galamsey activity threatening a gas pipeline, flooding
of the villager’s house caused by mining operations and etc. Seven complaints have been resolved,
with some follow-up actions, and the rest were still under investigation.
In Ghana, small-scale artisanal mining is termed “galamsey”. It is mostly unauthorized or illegal and
is often associated with environm ental degradation, safety haza rds and general community and
social concerns. The mine also encounters a challenge with gala msey, particularly in the Benso
administration office  area. The area  was attacked by galamsey miners from Subriso community on
16 March 2023, and this led to the destruction of company assets such as Tipper trucks, light vehicles,
office buildings, and office equipment which led to a temporary  suspension of operations. GSWL
intensified its security monitoring activities to drive away galamsey miners that operated close to its
mining areas. Several stakeholder meetings were conducted with opinion leaders and youths from
both Wassa and HBB communities, especially those involved in ga lamsey, emphasizing the
importance of refraining from such actions to preserve rehabilitated sites and the environment. Upon
discussion with on-site personnel during the site visit, GSWL is of the opinion that galamsey around
Wassa Mine has little potential to impact the current or future operations. Generally, the removal of
unauthorized persons from the project area has posed no difficu lty, and local law enforcement is
engaged when necessary. Since the Benso, located about 40-50 km from the main Wassa site (the
primary mining operation) and Hwini-Butre, located about 80km f rom the Wassa Main, have had
most of its economically viable surface resources extracted ren dering it largely irrelevant to the
Company’s ongoing mining operations.

– IIIC-257 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Capital and Operating Costs    Final
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17 Capital and Operating Costs
This section summarises the Capex and Opex.
The Wassa mine has been in operation since 2017, consisting of one open pit and one underground
mine. The associated Capex for deeper development and sustainability are estimated by the mine.
The Wassa mine has relative stable operation, allowing the forecasting of Opex based on historical
records. All the Capex and Opex are provided in USD by the mine management.
17.1 Capital Expenditure
17.1.1 Summary
The Capex for Wassa over the LoM includes capitalised mine deve lopment, sustaining capex, and
mine closure and reclamation. A summary of the Capex is presented in Table 17-1, with the Capex
investment plan over the LoM detailed in Figure 17-1. The sunk and forecast capital expenditure over
the LoM is shown in Table 17-2.
Table 17-1: Summary of Capex for Wassa Mine
Capex Unit LOM Total
Capital development Million USD 78
Other Sustaining Capex Million USD 91
Closure Million USD 27
Total Capex Million USD 197
Sources: GSR, summarized by SRK
Figure 17-1: Capex Investment Plan over LOM

Sources: SRK
Table 17-2: Consolidated Capital Expenditure (Sunk and Forecast) over LOM
Capex Unit LoM 2021 2022 2023 2024 2025 2026 2027 2028
Capital development USD Milli on 102.5 36.5 42.7 20.0 3.3 -
29
74
80
9 5
 -
 10
 20
 30
 40
 50
 60
 70
 80
 90
 100
2024 Q4 2025 2026 2027 2028
Million USD
Capital development Other capital expenditures Closure
– IIIC-258 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Capital and Operating Costs    Final
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Capex Unit LoM 2021 2022 2023 2024 2025 2026 2027 2028
Other capital expenses USD Million 102.1 22.2 25.6 54.3 - -
Closure USD Million 27.2 5.4 5.4 5.4 5.4 5.4
Sunk Capex USD Million 222.7 83.7 69.0 70.1
Total Capex USD Million 454.5 83.7 69.0 70.1 64.1 73.7 79.8 8.7 5.4
17.1.2 Capitalisation
Capitalisation involves treating expenditures on equipment and mine development for servicing the
mine, for more than one year, as long-term assets, which is then depreciated or amortized over time
rather than expensed immediately, Table 17-3 shows the capitalisation for the last three years.
Table 17-3: Capitalisation over the LoM
Item Unit 2022 2023 2024 Q1-Q3
Capitalisation '000 USD 18,844 25,715 39,836
Sources: GSR, summarized by SRK
17.1.3 Sustaining Capex
The sustaining Capex for Wassa is categorized into two main areas: development and other
sustaining capital expenditures, which include essential invest ments in mining, metallurgy,
maintenance, and various support departments.
Development
For mine development that services the mine for more than one y ear, the assumed unit cost of
development is US$3,620.03/ m. The development meter over the LoM is shown in Table 17-4.
Table 17-4: Capital Development Meters over the LoM
Development Meters Unit Total 2024 2025 2026 2027
Lateral capital development m 20, 140  3,121  11,067  5,123  828
Vertical capital development m 1,448  220  733  414  82
Sources: GSR, summarized by SRK
Other Sustaining Capex
Other sustaining capex is summarised in Table 17-5. The sustain ing Capex for Wassa Mine,
excluding development, totals US$ 94 million. Key expenditures i nclude US$ 74 million for mining,
US$4 million for the Metallurgy Department, and US$3.9 million for Mine Maintenance. Additional
costs are allocated to Human Resources, Environment & CSR, Heal th & Safety, Finance & IT,
carryover projects, and exploration activities.
Table 17-5: Other Sustaining Capex over the LoM
Item Unit Total 2024 Q4 2025 2026
Mining (excl. dev) '000 USD 74,736 9,411  16,967 48,358
– IIIC-259 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Capital and Operating Costs    Final
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Item Unit Total 2024 Q4 2025 2026
Metallurgy Department Total ' 000 USD 4,086 79  1,199 2,808
Mine Maintenance Department ' 000 USD 3,922 1,290  595 2,037
Human Resources & Admin ' 000 USD 1,273 111  1,162 -
Environment & CSR '000 USD 202 -    202 -
Health & Safety '000 USD 446 66  70 310
Finance, IT Supply & Projects '000 USD 1,348 242  310 796
2023 Carry Over Projects '000 USD 887 39  848 -
Exploration '000 USD 7,176 2,958  4,218 -
Supply & Contracts '000 USD 79 79
Other Capex Total '000 USD 94,076 14,19 7  25,571 54,308
Sources: GSR, summarized by SRK
17.1.4 Closure
Closure costs refer to the expenses incurred for safely shuttin g down and rehabilitating a mine site
at the end of LOM. SRK reviewed a Decommissioning Plan by Golder Associates, dated June 2015.
The total rehabilitation and cl osure cost was estimated at approximately USD 27 million, covering
infrastructure, mining areas, general surface reclamation, wate r management, and post-closure
activities for the Wassa, Benso, and Hwini Butre area.
Although this is not the final figure and is not recommended for use, it is the only available estimate
currently. SRK will allocate the USD 27 million evenly over the  LOM in the technical economic
analysis.
17.2 Operating Cost
SRK has received two sets of costing data: one from Chifeng Gro up for the annual report and the
other from Wassa Mine. The first set is organized by cost elements, while the second is grouped by
activities. SRK has summarized both sets of data and used the first set, grouped by cost elements,
as the input for the Technical Economic Model (TEM).
17.2.1 Cost by Elements
Historical Operating Cost
The total operating cash costs from 2022 to 2024 Q3, which exclude depreciation, amortization, and
financial costs, are presented in Table 17-6. Table 17-7 presents the unit costs for the same period,
along with the average unit cost and the unit cost for TEM (technical economic model) input.
Table 17-6: Operating Costs from 2022 to 2024 Q3
Item Unit 2022 2023 2024 Q3
Labor USD M 31.75 35.80 29.96
Material USD M 58.50 51.72 65.47
Electricity USD M 8.03 18.72 9.02
Contractors USD M 1.78 10.71 3.43
– IIIC-260 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Capital and Operating Costs    Final
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Item Unit 2022 2023 2024 Q3
Engineering USD M 4.25 9.29 4.02
Service USD M 1.46 1.74 2.56
Safety USD M - - -
Repairment USD M - - -
Others USD M 6.99 - 0.33
Taxes and surcharges USD M 13.23 17.96 19.22
Selling costs USD M - - -
G&A costs USD M 20.41 16.97 12.76
R&D costs USD M - - -
Sources: GSR, summarized by SRK
Table 17-7: Operating Unit Costs from 2022 to 2024 Q3
Item Unit 2022 2023 2024 Q3 Unit Cost TEM Input
Labor USD/t 15.00 14.03 13.02 13.99 20.99
Material USD/t 27.63 20.27 28.46 25.21 37.82
Electricity USD/t 3.79 7.34 3.92 5.13 7.70
Contractors USD/t 0.84 4.20 1.49 2.29 3.43
Engineering USD/t 2.01 3.64 1.75 2.52 3.78
Service USD/t 0.69 0.68 1.11 0.83 1.24
Safety USD/t - - - - -
Repairment USD/t - - - - -
Others USD/t 3.30 - 0.14 1.05 1.58
Taxes and surcharges USD/t 6.25 7.04 8.36 7.23 7.23
Selling costs USD/t - - - - -
G&A costs USD/t 9.64 6.65 5.55 7.20 9.35
R&D costs USD/t - - - - -
Sources: GSR, summarized by SRK
Notes: SRK has adjusted the unit cost upward to a more reasonable leve l, resulting in the TEM input being higher than the
average unit cost.
Forecasted Operating Cost
The operating cost over the LOM is shown in Table 17-8.
Table 17-8: Operating Cost Forecast (Million USD)
Item 2024 Q4 2025 2026 2027 2028
Labor 21 67 53 34 10
Material 37 121 95 61 19
Electricity 8 25 19 12 4
Contractors 3 11 9 6 2
Engineering 4 12 10 6 2
Service 1 4 3 2 1
Safety - - - - -
Repairment - - - - -
Others 2 5 4 3 1
Taxes and surcharges 7 23 18 12 4
Selling costs - - - - -
G&A costs 9 30 24 15 5
R&D costs - - - - -
Sources: GSR, summarized by SRK
– IIIC-261 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Capital and Operating Costs    Final
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17.2.2 Cost by Activities
Summary
The operating costs are categorized into open pit mining, under ground mining, processing, G&A.
Table 17-9 shows the total cost and unit cost of each category.
The overall cost trends from 2022 to the 2024 Q3 indicate a dynamic shift in unit costs across various
mining operations. The Total Cash Unit Cost has decreased from US$75.19 per tonne in 2022 to
US$65.56 per tonne in the 2024 Q3, reflecting a gradual reduction in overall expenses.
Table 17-9: Summary of Historical Opex for Wassa Mine
Item Unit 2022 2023 2024 Q3
Open Pit Mining USD/t
TMM 4.69 6.47 6.78
Underground
Mining
USD/t
ROM 41.76 45.38 40.04
Processing USD/t
Feed 19.09 13.63 13.19
G&A USD/t
Feed 9.64 6.65 5.55
Total Cash Unit
Cost
USD/t
Feed 75.19 72.13 65.56
OP Mine TMM kt 1,392 3,024 1,765
UG Mine ROM kt 1,816 1,701 1,785
Plant Feed kt 2,117 2,551 2,300
Sources: GSR, summarized by SRK
Figure 17-2 shows that Underground Mining accounts for the larg est share of total costs at 54%,
followed by Processing at 25%. G&A expenses and Open Pit Mining  make up 12% and 9% of the
costs, respectively.
Figure 17-2: Pie Chat of Percentage for Wassa Mine Opex

Sources: GSR, summarized by SRK
Open Pit Mining
9%
Underground
Mining
54%
Processing
25%
G&A
12%
Open Pit Mining Underground Mining Processing G&A
– IIIC-262 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Figure 17-3 illustrates the breakdown of Total Cash Costs by category for the years 2022, 2023, and
the 2024 Q4. Total Cash Costs increased from US$143.2 million in 2022 to US$148.5 million in 2023,
before decreasing to US$127.1 million in 2024 Q3, reflecting sh ifts in operational expenditures
across these categories. The main reason for the declining OPEX  is the increased allocation of
capitalized OPEX and the rise in diamond drilling, which is log ical due to the deeper development
and in-fill drilling plan.
Figure 17-3: Operating Costs for historical three-year (in ‘000USD)

Sources: GSR, summarized by SRK
Open Pit Mining
The open-pit mining costs from 2022 to the first half of 2024, as illustrated in Table 17-10. The unit
cost per total material movement (TMM) was US$4.69 in 2022, US$ 6.47 in 2023, and US$7.16 in
the 2024 Q3.
Table 17-10: Breakdown of Open Pit Mining Cost
Item Unit 2022 2023 2024 Q3
Ancillary Equipment (Maint.) '000 USD 83 -21 514
Drilling (Maint.) '000 USD - - -
Drilling (Ops.) '000 USD 2,335 1,267 915
Geology (Ops.) '000 USD 135 305 167
Hauling (Maint.) '000 USD 77 -171 -57
Hauling (Ops.) '000 USD 1,059 3,801 6
Loading (Maint.) '000 USD 120 -253 -87
Loading (Ops) '000 USD 810 11,317 8,084
Overheads (Maint.) '000 USD 79 34 302
Overheads (Ops.) '000 USD 1,688 2,946 2,551
2022 2023 2024 Q1–Q3
Total 143,219 148,472 127,193
G&A 20407.50012 16969.4499 12764.49641
Processing 40415.84563 34771.59561 30341.83155
Underground Mining 75861.52401 77166.42027 71459.56726
Open Pit Mining 6534.36614 19564.85172 12627.53826
143,219 148,472
127,193
0
20000
40000
60000
80000
100000
120000
140000
160000
180000
200000
OPEX ('000 USD)
– IIIC-263 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Capital and Operating Costs    Final
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Item Unit 2022 2023 2024 Q3
Technical Services (Ops.) '000 USD 147 313 232
Water Management (Ops.) '000 USD - 27 -
Open Pit Mining Cost '000 USD 6,534 19,565 12,628
Ore Tonnes Mined kt 350 693 496
Waste Tonnes Mined kt 1,042 2,331 1,269
Total Material Movement kt 1,392 3,024 1,765
Unit Cost US$/TMM 4.69 6.47 7.16
Sources: GSR, summarized by SRK
Underground Mining
The underground mining costs from 2022 to the 2024 Q3, as shown  in Table 17-11, show a steady
level of expenditures with total costs of US$75.9 million in 20 22, US$77.2 million in 2023, and
US$71.5 million in the 2024 Q3.
The unit cost per tonne was US$41.76 in 2022, US$45.38 in 2023,  and US$40.0 in the 2024 Q3.
The main reason for the declining opex is the increased allocation of capitalized opex and the rise in
diamond drilling, which is logical due to the deeper development and in-fill drilling plan.
For future cost estimation (Ope x); the development cost will be  calculated based on the meters of
mined development, while the backfill cost will be calculated b ased on cubic meters (m³) or tons,
depending on the scheduling.
Table 17-11: Breakdown of Underground Mining Cost
Item Unit 2022 2023 2024 Q3
Ancillary Equipment (Maint.) '000 USD 4,291 3,244 3,503
Backfill (Maint.) '000 USD 516 417 306
Backfill (Ops.) '000 USD 7,031 9,211 1,421
Blasting (Ops.) '000 USD 6,023 7,337 5,459
Capitalised Opex Allocation '000 USD -18,844 -25,715 - 39,836
Contract Development '000 USD - - 12,787
Contract Production '000 USD - - 17,113
Development Blasting (Maint.) '000 USD 64 49 64
Development Drilling (Maint.) '000 USD 5,057 5,099 5,351
Development Drilling (Ops.) '000 USD 4,719 4,239 2,516
Development Overhead (Maint.) '000 USD 461 366 243
Development Overhead (Ops.) ' 000 USD 3,921 3,636 2,647
Diamond Drilling '000 USD 3,495 9,790 8,269
Geology (Ops.) '000 USD 2,470 3,040 3,026
Ground Support (Ops.) '000 USD 5,507 5,011 2,913
Hauling (Maint.) '000 USD 3,924 4,800 4,316
Hauling (Ops.) '000 USD 7,196 5,384 4,959
Light Vehicles (Maint.) '000 USD 963 987 737
– IIIC-264 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Independent Competent Person’s Report for Wassa Gold Mine, Akyempim, Western Region, Ghana
Capital and Operating Costs    Final
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Item Unit 2022 2023 2024 Q3
Loading (Maint.) '000 USD 6,700 6,555 6,379
Loading (Ops.) '000 USD 1,391 1,035 1,449
Mine Overheads (Ops.) '000 USD 10,636 11,169 8,922
Overheads (Maint.) '000 USD 6,380 6,468 4,995
Overheads (Ops.) '000 USD 1,682 2,044 1,754
Power '000 USD 3,350 3,998 3,702
Production Blasting (Maint.) '000 USD - - -
Production Drilling (Maint.) '000 USD 1,863 2,143 2,476
Production Drilling (Ops.) '000 USD 1,343 1,964 1,160
Production Overhead (Ops.) '000 USD 1,965 1,283 1,087
Technical Services (Ops.) '000 USD 2,603 2,733 2,834
Ventilation '000 USD 588 670 561
Water Management (Ops.) '000 USD 566 206 346
Grand Total '000 USD 75, 862 77,166 71,460
Ore Tonnes Mined kt 1,816 1,701 1,785
Waste Tonnes Mined kt 548 850 975
Total Material Movement kt 2,365 2,551 2,760
Unit Cost US$/ore ton 41.76 45.38 40.04
Sources: GSR, summarized by SRK
Development
The assumed unit cost of development is US$3,620.03/ m. The development meter over the LoM is
shown in Table 17-12.
Table 17-12: Operating Development Meters over the LoM
Development
Meters Unit LoM 2024 2025 2026 2027 2028
Lateral operating
development m 18,541 4,333 5,372  3,945  1,635  194
Sources: GSR, summarized by SRK
Backfill
There is no detailed breakdown of backfill costs available, so SRK has used historical backfill costs
to estimate future expenses. There are two types of backfill: r ockfill and pastefill. For the 2024 Q3,
the estimated backfill cost is approximately US$1/t, with SRK a ware that only rockfill was used,
making the cost for rockfill US$1/t. In 2023, the backfill cost  was US$5.66/t. Since there is no
specified ratio between rockfill and pastefill, SRK assumes this to be the pastefill cost, which is
considered reasonable based on industry benchmarks.
Processing
The processing costs from 2022 to 2024 Q3, as illustrated in Table 17-13. The total processing cost
was US$40.4 million in 2022, US$34.8 million in 2023, and US$30.3 million in the 2024 Q3.
– IIIC-265 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Capital and Operating Costs    Final
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The unit cost per ton milled was US$19.09 in 2022, US$13.63 in 2023, and US$13.19 in the 2024
Q3.
Table 17-13: Breakdown of Processing Cost
Item Unit 2022 2023 2024 Q3
Carbon In Leach (Maint.) '000 USD 798 155 332
Carbon In Leach (Ops.) '000 USD 6,070 5,352 5,051
Crushing (Maint.) '000 USD 2,827 1,726 2,272
Crushing (Ops.) '000 USD 3,463 3,309 2,169
Gold Recovery (Maint.) '000 USD 28 16 11
Gold Recovery (Ops.) '000 USD 2,465 2,158 1,854
Gravity  and Acacia (Maint.) '000 USD 116 55 124
Gravity and Acacia (Ops.) '000 USD 209 156 125
Laboratory '000 USD 1,359 1,321 920
Milling and Classification (Maint.) '000 USD 1,213 889 1,060
Milling and Classification (Ops.) '000 USD 8,397 8,356 7,003
Overheads (Maint.) '000 USD 5,765 4,981 4,074
Overheads (Ops.) '000 USD 6,118 5,481 4,483
Self Gen Power (Maint.) '000 USD 146 77 142
Tailings Storage Facility (Maint.) '000 USD 112 92 87
Tailings Storage Facility (Ops.) '000 USD 894 396 251
Thickeners (Maint.) '000 USD 107 17 174
Thickeners (Ops.) '000 USD 157 196 140
Water treatment Facility (Maint.) '000 USD 173 38 71
Processing cost '000 USD 40,416 34,772 30,342
Ore tonnes milled kt 2,117 2,551 2,300
Unit Cost US$/milled ton 19.09 13.63 13.19
Sources: GSR, summarized by SRK
G&A
The G&A costs from 2022 to 2024 Q3, as illustrated in Table 17-14, show the allocation of expenses
across various administrative functions. The total G&A cost was  US$20.4 million in 2022, US$17
million in 2023, and US$12.8 million in the 2024 Q3.
The unit cost per tonne milled decreased from US$9.64 in 2022 t o US$6.65 in 2023, and further to
US$5.55 in the 2024 Q3.
Table 17-14: Breakdown of G&A Cost
Item Unit 2022 2023 2024 Q3
Business Improvement '000 USD 258 74 -
Camp and Housing '000 USD 1,223 949 670
Capital projects '000 USD 697 636 9
Civil Work '000 USD 666 523 363
– IIIC-266 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Capital and Operating Costs    Final
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Item Unit 2022 2023 2024 Q3
Community relations - General '000 USD 856 800 494
Environmental - Compliance '000 USD 711 637 336
Environmental - General '000 USD 1,645 957 860
Finance - General '000 USD 3,467 2,891 2,665
GM Office '000 USD 916 594 546
Health & Safety - Clinic '000 USD 492 406 276
Health & Safety - ERT '000 USD 0 - -
Health & Safety - General '000 USD 1,344 1,202 1,088
HR - General '000 USD 1,533 1,234 1,032
Industrial Relations '000 USD 335 227 195
Information technology - General '000 USD 2,189 1,984 1,399
Land management '000 USD 10 6 7
Light Vehicles '000 USD 892 751 537
Maintenance - G&A '000 USD 134 73 74
Procurement & Contract Management '000 USD 771 767 595
Rehabilitation '000 USD -3 - 0
Rotational/Shift Transportation '000 USD 445 513 352
Security - General '000 USD 1,164 1,215 825
Supply Chain - Warehouse management '000 USD 628 515 422
Water Supply '000 USD 35 16 20
G&A Cost '000 USD 20, 408 16,969 12,764
Ore tonnes milled kt 2,117 2,551 2,300
Unit Cost US$/milled ton 9.64 6.65 5.5
Sources: GSR, summarized by SRK


– IIIC-267 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Economic Analysis    Final
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18 Economic Analysis
The economic analysis presented in this section is based purely on the results of the technical review
provided above and some key assumptions and is provided for technical evaluation and Ore Reserve
estimation purposes only.
The economic analysis was conducted using conventional Discount ed Cash Flow (“DCF”)
techniques. The Net Present Value (“NPV”) was determined from the project's cash flow using a 10%
discount rate. It should be noted that SRK’s DCF modelling and NPV calculation are carried out with
the purpose of testing the “economic viability” of the Project which is required to a reasonable Ore
Reserve reporting. Additionally, a sensitivity analysis was per formed to examine the effects of
changes in Capex, Opex, and gold price (revenue).
18.1 Principal Assumptions
18.1.1 General
The cash flow estimate includes only the revenue, costs, taxes, and other factors directly associated
with the Project. The assumptions are as follows:
 The currency used for the Project is US dollars.
 Annual gross revenue is calculated by applying the estimated go ld price and payables to the
annual recovered metal for each operating year.
 The “nominal” values are applied. SRK does not consider future inflation of currency or cost
fluctuations; the cost remains constant over the LoM without any adjustments are factored in.
 Financing is assumed to be on a 100% equity basis; no debt or related financing costs have been
included in the technical economic analysis.
 Neither corporate obligations, financing costs, or corporate-level taxes are not considered.
 Sustaining capital for future exploration, which is aimed at discovering more Mineral Resources
that is outside the Ore Reserves estimates, is not considered during this analysis, as the current
project economic analysis has not employed any additional potential tonnage or grade.
 No salvage value has been included in the technical economic analysis.
 The reference date or effective date is 30 September 2024.
18.1.2 LOM Physical
The mine production and key technical inputs parameters are described in the previous section.
The summary of the key physical assumptions is presented in Table 18-1.
– IIIC-268 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Economic Analysis    Final
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Table 18-1: LOM Physical Inputs for Economic Analysis
Item Unit LOM Total or
Average
Open Pit
Open Pit Ore Reserves t 538,041
Open Pit Au Grade g/t 0.92
Underground
Underground Ore Reserves t 8,274,022
Underground Au Grade g/t 2.20
Ore Reserves t 8,812,064
Gold Grade g/t 2.12
Life of Mine yr 5
Recovery Rate % 96
Source: GSR, organized by SRK
18.1.3 Pricing Assumptions
Table 18-2 shows the price trend and long-term price for Gold, which is dynamic and is derived from
consensus market forecasts provided by the Energy and Metals Consensus Forecast, published by
Consensus Economics Inc., to which SRK subscribes annually.
Table 18-2: Gold Price Forecasts
Year 2024 2025 2026 2027 2028 2029 Long-
term Price
Gold  2,410 2,400 2,200 2 ,090 2,000 1,700 1,700
Source: CMF, end of August
18.1.4 Tax and Royalties
The income tax rate in Ghana is 35%.
18.1.5 Depreciation and Amortization
The capital and sustaining expenditures, including development costs, have been depreciated on a
unit production basis over the LOM. The assumed depreciation follows the straight-line method over
a period of 5 years.
18.1.6 Working Capital
Working capital is the capital needed to fund operations before revenue is received from the finished
product. It was calculated as 30% of the operating cost for the initial year. Over the project's life, the
working capital nets to zero.
18.2 DCF Projection
The key economic results from the technical economic model is shown in Table 18-3.
– IIIC-269 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Economic Analysis    Final
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Table 18-3: LOM Profit, Loss & Cash Flow Forecasting
Item Unit LOM Total Annually Average over LOM
Revenue (incl. VAT) M illion USD 1,358  272
Opex Million USD (821) (164)
Closure Million USD (27) (5)
EBITDA Million USD 510  102
Depreciation Million USD (124) (25)
EBIT Million USD 386  77
Income Tax Million USD (142) (28)
Net Profit Million USD 244  49
Add back Depreciation Million USD 124  25
Less Sustaining Capex Million USD (169) (34)
Free Cash Flow Million USD 199  40
Source: SRK
The forecasts for the Project shows a positive economic prospec t. At a discount rate of 10%, the
NPV of the Project is USD 168 million.  The sensitivity of NPV against discount rate is presented in
Table 18-4.
Table 18-4: Wassa Mine NPV versus Discount Rate
Discount Rate (%) NPV (million
USD)
5% 182
6% 179
7% 176
8% 173
9% 170
10% 168
11% 165
12% 163
13% 160
14% 158
15% 155
Source: SRK
The annual cash flows are presented graphically in Figure 18-1.
– IIIC-270 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Economic Analysis    Final
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Figure 18-1: Cash Flow Profile

Source: SRK
18.3 Sensitivity Analysis
SRK conducted a single-factor sensitivity analysis for the Project to determine which factors most
significantly impact its economics when considered independentl y. The analysis focused on gold
price, Capex, and Opex, each tested within a ±30% range.
The results showed that the Project is most sensitive to change s in gold price. Results of the
sensitivity tests are presented in Table 18-5 and Figure 18-2.
The break-even gold prices occur when the gold price drops by a pproximately 20%, resulting in an
NPV of 0 at a 10% discount rate.
 (50)
 -
 50
 100
 150
 200
 250
 (20)
 (10)
 -
 10
 20
 30
 40
 50
 60
 70
 80
2024 Q4 2025 2026 2027 2028
Cumulative Cash Flow (Million USD)
Annual Free Cash Flow (Million USD)
Free Cash Flow Cumulative Free Cash Flow
– IIIC-271 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Economic Analysis    Final
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Table 18-5: Sensitivity Analysis Result
Variance
Opex Capex Price
NPV @ 10% Annual Discount Rate (US$M)
-30% 319 207 -83
-25% 294 201 -39
-20% 269 194 4
-15% 243 187 45
-10% 218 181 86
-5% 193 174 127
0% 168 168 168
5% 143 161 209
10% 117 155 250
15% 92 148 291
20% 67 142 332
25% 42 135 373
30% 17 129 414
Source: SRK
Figure 18-2: Sensitivity Spider Chart

Source: SRK

18.4 Wassa Ore Reserves and Upside Plan
The Wassa Mine has provided the Ore Reserves and upside plan, b ased on the Wassa Design.
During discussions with the Wassa Mine, SRK understood that the Updated Wassa Design includes
Residual material in the upper area and Material in the lower a rea. However, due to the time
constraints in preparing and reviewing the Updated Wassa Design, SRK considers this an
opportunity for potential economic material but does not classify it as an Ore Reserve, as detailed in
Chapter 12.2.9. This section is intended to demonstrate the economic viability of the Ore Reserves
and upside plan (Updated Wassa Design).
A summary of the Capex is presented in Table 18-6, with the Cap ex investment plan over the LoM
detailed below.
-200
-100
0
100
200
300
400
500
-30% -25% -20% -15% -10% -5% 0% 5% 10% 15% 20% 25% 30%
Million US$
OPEX CAPEX Price
– IIIC-272 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1798 ---
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Economic Analysis    Final
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Table 18-6: Summary of Capex for Wassa Mine (Ore Reserves and Upside Plan)
Capex Unit LOM Total
Capital development Million USD 78
Other Sustaining Capex Million USD 91
Closure Million USD 27
Total Capex Million USD 197
Sources: GSR, summarized by SRK
The operating cost over the LOM is shown in Table 18-7.
Table 18-7: Operating Cost Forecast (Million USD)
Item 2024 Q4 2025 2026 2027 2028
Labor 21 67 53 34 28
Material 37 121 95 61 50
Electricity 8 25 19 12 10
Contractors 3 11 9 6 5
Engineering 4 12 10 6 5
Service 1 4 3 2 2
Safety - - - - -
Repairment - - - - -
Others 2 5 4 3 2
Taxes and surcharges 7 23 18 12 10
Selling costs - - - - -
G&A costs 9 30 24 15 12
R&D costs - - - - -
Sources: GSR, summarized by SRK
The principal assumptions outlined in Chapter 18.1, along with the above Capex and Opex, resulting
in a positive NPV, indicating that the Ore Reserves and upside plan is economically mineable with
both scenarios.
At a discount rate of 10%, the NPV of the Project is USD 167 million.
The sensitivity of NPV against discount rate is presented in Table 18-8.
Table 18-8: Wassa Mine NPV versus Discount Rate
Discount Rate (%) NPV (Million USD)
5% 192
6% 185
7% 178
8% 172
9% 166
10% 161
11% 155
12% 150
13% 145
14% 141
– IIIC-273 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Economic Analysis    Final
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Discount Rate (%) NPV (Million USD)
15% 136
Source: SRK
SRK conducted a single-factor sensitivity analysis for the Project to determine which factors most
significantly impact its economics when considered independentl y. The analysis focused on gold
price, Capex, and Opex, each tested within a ±30% range. The result showed that the Project is most
sensitive to changes in gold price. Results of the sensitivity tests are presented in Table 18-9 and
Figure 18-3. The break-even gold prices occur when the gold pri ce drops by approximately 21%,
resulting in a NPV of 0 at a 10% discount rate.
Table 18-9: Sensitivity Analysis Result (Ore Reserves and Upside Plan)
Variance
Opex Capex Price
NPV @ 10% Annual Discount Rate (US$M)
-30% 297 194 -71
-25% 274 189 -29
-20% 252 183 11
-15% 229 178 50
-10% 206 172 87
-5% 184 166 124
0% 161 161 161
5% 138 155 198
10% 115 150 235
15% 93 144 272
20% 70 139 309
25% 47 133 346
30% 24 127 383
Source: SRK
Figure 18-3: Sensitivity Spider Chart (Ore Reserves and Upside Plan)

Source: SRK

-100
-50
0
50
100
150
200
250
300
350
400
450
-30% -25% -20% -15% -10% -5% 0% 5% 10% 15% 20% 25% 30%
Million US$
OPEX CAPEX Price
– IIIC-274 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Risk Analysis    Final
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19 Risk Analysis
Mining is a relatively high-risk industry. In general, the risk  may be expected to decrease from
exploration, development, through to production stage. The Wass a Gold Project is a production
project. Risks exist in different areas. SRK considered various  technical aspects which may affect
sustainable operation and future cash flow of the Project, and conducted a qualitative risk analysis
which has been summarised in Table 19-1. In this risk analysis,  various risk sources/ issues have
been assessed for Likelihood and Consequence, and then a Risk R ating has been assigned. The
qualitative risk analysis uses the following definitions for likelihood and consequence.
The Likelihood of a risk is considered within a certain time frame, e.g. 5 years, as:
 Likely: will probably occur;
 Possible: may occur; and
 Unlikely: unlikely to occur.
The Consequence of a risk is classified into:
 Major Consequence: the factor poses an immediate danger to the Project, if uncorr ected, will
have a material effect on the Project cash flow and performance and could lead a project failure;
 Moderate Consequence: the factor, if uncorrected, will have a significant effect on the Project
cash flow and performance; and
 Minor Consequence: the factor, if uncorrected, will have little or no effect on th e Project cash
flow and performance.
The overall risk assessment combines the Likelihood and Consequ ence of a risk and be classified
as Low (unlikely and possible minor risks and unlikely moderate risk), Medium (likely minor, possible
moderate and unlikely major risks), and High (likely moderate and major and possible major risks).
Below is the qualitative risk analysis summary table of the Wassa Gold Project.
Table 19-1: Project Risk Assessment of the Wassa Gold Project
Risk Source/Issue Likelihood Consequence Overall
Geology and Resource
Lack of Significant Mineral Resources Unlikely Moderate Low
Overestimate of the Mineral Resource Grade  Possible Moderate Medium
Unknown Significant Geological Structure Unlikely Moderate Low
Unexpected Groundwater Ingress Possible Moderate Medium
Mining
Subsidence and Ground Stability Unlikely Moderate Low
Hydrogeological Modeling Uncertainties Possible Minor Low
Significant Production Shortfalls Unlikely Major Medium
Lack of Significant Ore Reserves Unlikely Major Medium
Ore Processing
Significantly Lower Recovery Unlikely Moderate Low
Higher Processing Cost Possible Moderate Medium
– IIIC-275 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


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Risk Analysis    Final
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Risk Source/Issue Likelihood Consequence Overall
Poor Plant Reliability Unlikely Moderate Low
Capital and Operating Costs
Project Timing Delays Unlikely Moderate Low
Capex and Opex Increases Possible Moderate Medium
Higher Mine Closure Liability Possible Moderate Medium
Environmental, Social and Governance
Water Management Possible Moderate Medium
Waste Rock and TSF Management Possible Moderate Medium
Hazardous Materials Management Unlikely Moderate  Low
Social Licensee to Operate Possible Moderate Medium
Infrastructure
Poor TSF Management Unlikely Moderate Low
Shortfall of Water Supply Possible Moderate Medium
Shortfall of Power Supply  Possible Moderate Medium
Poor Condition of the Site Road Possible Minor Low
The Wassa Project is an operating project with constant open pi t and open pit production. The
geology, mining methods and metallurgical flowsheet have been p artly verified and proved by
historical operation. Overall ratings of technical risks of the  Project are low and some medium risks
exist in different aspects. The risks and recommended management measures are discussed below.
 The geological risks relate to the uncertainty of underground hydrogeology associated with local
geological structures. SRK recommends to maintaining and enhancing the geological exploration,
such as mapping the underground tunnels, especially for faults and fractures, and monitoring the
underground water discharges.
 The geological risks also related to the grade estimation of underground Mineral Resources. SRK
noted there are abundant Inferred Mineral Resources for the und erground mine and further
exploration potential, and the cu rrent Inferred Mineral Resourc es in deeper zones have been
estimated on primarily drill core  interceptions with sparse dis tance so there is possibility of
underestimate or overestimate. S RK recommends continuous explor ation to be carried out for
the upgrade the underground Mineral Resources.
 The risk in relation to mining could be possible poor planning, as it is an underground mine with
a relatively high production rate. Consequently, possible risk will result to production shortfall or
Ore Reserve overstatement. SRK recommends carrying out in-depth  engineering studies
associate to LoM planning and the use of professional mine plan ning software. Professional
services may be sourced and retained, if needed.
 The risk in relation to ore processing and metallurgy could be the possibility of high operating
cost, as the current production is transitioning from undergrou nd production solely. Proper
management in grade control and planning will help reduce operating costs.
 The measures and practices to manage environmental risks relati ng to surface water and
groundwater may include separate drainage systems for productio n wastewater, domestic
sewage, and stormwater systems; storage of hazardous materials in a dedicated area could be
planned to control the risk of hazardous materials pollution. T he environmental risk of land
disturbances could be controlled by limiting the waste rock storage and other disturbances; scrap
iron and other industrial waste collection and recycling activi ty may control the risks resulting
from waste generation. SRK notes  a conceptual closure plan shou ld be updated with ceasing
– IIIC-276 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1802 ---
Independent Competent Person’s Report for Wassa Gold Mine, Akyempim, Western Region, Ghana
Risk Analysis    Final
SRK CONSULTING (CHINA) LTD.   28 FEBRUARY 2025  PX/AT - 258 -
open pit production and further underground operation. TSF mana gement associates to social
responsibility, and should be taken into account.
 The risks in relation to capital and operating costs include underestimates of project costs. Proper
management and detailed mine scheduling may help the undergroun d development of the
Project in a proposed schedule. SRK recommends updating or adju sting the project’s costs
estimation from time to time according to production data in th e future. It is SRK’s opinion that
the risks identified above are generally under control and not likely to develop into higher level of
risks, as noted the Company and Wassa Project team has tracked record in production and risk
management.

– IIIC-277 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1803 ---
Independent Competent Person’s Report for Wassa Gold Mine, Akyempim, Western Region, Ghana
Conclusions and Recommendations   Final
SRK CONSULTING (CHINA) LTD.   28 FEBRUARY 2025  PX/AT - 259 -
20 Conclusions and Recommendations
20.1 Conclusions
20.1.1 Geology and Exploration
 The Wassa deposit can be classified as an Eoeburnean folded vein system and is the only such
deposit recognised to date within the Ashanti belt.
 The core drilling, geological logging etc. are implemented to a  standard ensuring that the
gathered data and information adequately underpin the objective s of subsequent geological
modelling and Mineral Resources estimations.
 The procedures for sampling, preparation, analysis, and QA/QC a re following the industry
standards. SRK considers that they are acceptable for Mineral Resources estimations.
20.1.2 Mineral Resources Estimation
The Mineral Resources have been prepared in accordance with the JORC Code guidelines. Mining
is assumed by open pit methods at DMH, I Zone and Chichiwelli, and underground methods at
Wassa (242 and B Shoot) and Hwini Butre (FB/ADK).
The Mineral Resources have a RPEEE, with estimates constrained as follows:
 Open Pit: constrained by open pit shell and cut-off grade.
 Underground (FB/ADK): constrained by cut-off grade.
 Underground (242 and B Shoot): constrained by the MSO.
As of 30 September 2024, the Mineral Resources are estimated as:
 Measured and Indicated Mineral Resource: 16.74 Mt at 3.07 g/t, containing 1,650 koz gold.
 Inferred Mineral Resources: 60.89 Mt at 3.38 g/t, containing 6,609 koz gold.
20.1.3 Metallurgical Testing and Recovery Method
 Metallurgical tests were carried out before and after the const ruction of the processing plant in
2004. Both oxide and fresh ores h ave negligible preg-robbing ef fect and are amenable to CIL
process. The gold recovery of Gravity-CIL process is as high as 90% to 95%.
 The capacity of the processing plant is 2.7 Mtpa. A traditional Crushing-Milling-CIL process with
assistance of Gravity-Acacia operation in milling circuit is applied. The plant is well managed and
achieved good historical performance. The gold recovery is 95.3% to 97.1% with gold production
(in gold doré bars) of 4.84 to 5.31 tons per year.
– IIIC-278 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1804 ---
Independent Competent Person’s Report for Wassa Gold Mine, Akyempim, Western Region, Ghana
Conclusions and Recommendations   Final
SRK CONSULTING (CHINA) LTD.   28 FEBRUARY 2025  PX/AT - 260 -
20.1.4 Infrastructure
 The rehabilitation of TSF 1 is complete and is operated by the GSOPP for palm oil trees. The
construction and management of TSF 2 is conducted properly. The  planed extension of TSF 2
can meet the required capacity for tailings storage.
 The current two electricity resources (Ghanian grid power and mine generated) are sufficient for
operations and domestic needs. If the solar system is implemented, it could significantly reduce
power costs for offices and domestic use.
 The water balance is carefully managed. The facilities of backw ater, surface water and
underground water can fully support the operations of mining and processing.
20.2 Recommendations
SRK has made a number of recommendations during the review and/or site visits which have been
discussed among SRK consultants and client staff. Key recommendations include:
 The large Inferred Mi neral Resources need drilling programs. SR K understands that the
Company is working on a long-term exploration and production pl an for the Project, and the
current Inferred Mineral Resources will be upgraded in next few years.
 Improve the quality of grade control model and incorporate it i nto the Mineral Resource/ Ore
Reserve model. The current grade control model has not been incorporated into Mineral
Resource/ Ore Reserve model yet due to various reasons includin g grade-control sample data
quality and the duration of model update. SRK is aware of that the Company has already started
to work on the improvement of both models.
 Exploration potential and opportunities to be further analysed.
 Additional technical studies to examine the Measured and Indicated Mineral Resources excluded
from the current Ore Reserve estimate. SRK understands that GSWL recently commissioned a
third party to work with the Company’s mining team in this regard.
 Further test works on the deep underground veins may be needed to assure the processing
procedures and laboratory protocols being used are appropriate and suitable. This will be
dependent on future exploration programs and technical studies.
 It is a feasible plan for using renewable energy such as solar to replace gradually the electricity
used in offices and residential facilities, as the concept of decarbonisation has been considered
by the Company.


– IIIC-279 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1805 ---
Independent Competent Person’s Report for Wassa Gold Mine, Akyempim, Western Region, Ghana
References    Final
SRK CONSULTING (CHINA) LTD.   28 FEBRUARY 2025  PX/AT - 261 -
21 References
SRK Consulting (UK) Limited, Golden Star Resources Limited: NI 43-101 Technical Report on a
Feasibility Study of the Wassa Open Pit Mine and Underground Project in Ghana: December 2014.
SRK Consulting (UK) Limited, Golden Star Resources Limited: NI 43-101 Technical Report on a
Feasibility Study of the Wassa Open Pit Mine and Underground Project in Ghana: May 2015.
Golden Star Resources Limited: NI 43-101 Technical Report on th e Wassa Gold Mine (Mineral
Resource & Reserve Update and Preliminary Economic Assessment o f the Southern Extension
Zone), Western Region, Ghana: March 2021.
Golden Star Resources, 2024: 20240518_DMH_Model_Handover_20240524: May 2024.
Golden Star Resources, 2024: WUG_GC_Model_Handover_20240409: April 2024.
Final Report on Profiling of Mining Zones at Golden Star Resour ces, Wassa Mine, Minerals
Engineering Department, University of Mines and Technology, Tarkwa, September 2018
Monthly Metallurgical Production Report from 2020 to 2024
Mineralogical Studies and Tests Conducted in 2023,
Draft Environmental Impact Statement on Wassa Expansion Project, March 2016
GEOSYSTEMS CONSULTING LTD., Environmental Impact Statement on Updated Tailings Storage
Facility (TSF) 2 Project, September 2015
Golder Associates, Decommissioning Plan and Associated Asset Retirement Obligations for Golden
Star Wassa Limited, June 2015.
Golden Star (Wassa) Limited, Env ironmental Management Plans for  Surface and Underground
Operations (2022-2024)
Golden Star (Wassa) Limited, Annual Environmental Reports (2021, 2022, and 2023)



– IIIC-280 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1806 ---
Closure
This report, Independent Competent Person’s Report for Wassa Go ld Mine, Akyempim, Western Region, Ghana,
was prepared by

Pengfei Xiao, MAIG, MAusIMM,
Principal Consultant (Geology)
Overall Responsibility for the Report






Hubert Li, MAIG
Senior Consultant (Geology)
Responsible for Mineral Resources



Shan Chuang, M.Eng.
Senior Consultant (Mining)
Responsible for Mining and Costs

All data used as source material plus the text, tables, figures, and attachments of this document have been reviewed and prepared
in accordance with generally accepted professional engineering and environmental practices.
– IIIC-281 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1807 ---
and reviewed by

Alexander Thin, FAusIMM (CP)
Principal Consultant (Mining)
Responsible for Peer Review


– IIIC-282 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1808 ---
Appendix A Table 1 (JORC)
– IIIC-283 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1809 ---
Section 1: Sampling Techniques and Data
(Criteria in this section apply to all succeeding sections.)
Criteria Explanation Commentary
Sampling
techniques
• Nature and quality of sampling (e.g. cut
channels, random chips, or specific specialised
industry standard measurement tools
appropriate to the minerals under investigation,
such as downhole gamma sondes, or handheld
XRF instruments, etc.). These examples should
not be taken as limiti ng the broad meaning of
sampling.
• Include reference to measures taken to ensure
sample representivity and the appropriate
calibration of any measurement tools or systems
used.
• Aspects of the determination of mineralisation
that are Material to the Public Report.
In cases where ‘industry standard’ work has
been done this would be relatively simple (e.g.
‘reverse circulation drilling was used to obtain 1
m samples from which 3 kg was pulverised to
produce a 30 g charge for fire assay’). In other
cases more explanation may be required, such
as where there is coarse gold that has inherent
sampling problems. Unusual commodities or
mineralisation types (e.g. submarine nodules)
may warrant disclosure of detailed information.
• Diamond Drill (“DD”) samples were
collected with maximum 1.2 m and minimum
0.3 lengths, usually 1m lengths.
• Reverse Circulation drilling (“RC”) samples
were collected every 1 m. Where DD holes
have been pre-collared using RC, the
individual 1 m RC samples were combined
to produce 3 m composites
• Half core taken for DD samples.
• Sub-sampling of RC samples was carried
out using a Jones Riffle splitter.
• Sample preparation on s ite is restricted to
core logging and cutting, or RC and Rotary
Air Blast (“RAB”) sample splitting.
• Industry standards hav e been undertaken
for both DD and RC samples.
• Wassa site laboratory was used as the
primary laboratory for 3 m composites and
grade control RC samples from July 2007
onwards.
• Transworld Laborator ies was the primary
laboratory until July 2007.
• SGS (Tarkwa) was us ed for core samples
from July 2007 to August 2017.
• Core samples have be en sent to Intertek
(Tarkwa) since 2017.
• GSR changed the assay procedure from the
50 g fire assay method to 1 kg bulk leach
extractable gold (“BLEG”) assay because a
component of coarse gold was present in
the samples.
• Atomic absorption spectroscopy (AAS) for
gold grade determination.
Drilling
techniques
• Drill type (e.g. core, reverse circulation, open-
hole hammer, rotary air blast, auger, Bangka,
sonic, etc.) and details (e.g. core diameter, triple
or standard tube, depth of diamond tails, face-
sampling bit or other type, whether core is
oriented and if so, by what method, etc.).
• Drilling is carried ou t by a combination of
DD, RC) and RAB techniques.
• Most of the drilling has been conducted by
GSR, although there are some holes
completed by previous concession owners
by SGL (Wassa) or SJR (Hwini Butre and
Benso).
• RC and DD drilling wa s conducted with a
GSR geologist on site to align the drill rig
and check the drill head dip and azimuth.
• Downhole surveying wa s conducted using a
single shot camera, for RC and DD holes at
the bottom of holes exceeding 30 m depths
and then taken progressively every 30 m up
hole.
• For Wassa, the deeper holes, often
exceeding 1,000 m, are drilled from surface
using HQ (63.5mm) sized core and this
initial hole (referred to as the “mother” hole)
is drilled to the depth where the first
directional hole would be started. The
directional hole (or “daughter” hole) is drilled
– IIIC-284 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1810 ---
Criteria Explanation Commentary
using a smaller core size, NQ (47.6 mm)
and is deviated from the mother hole initially
using a casing wedge which is oriented in
the direction of the mineralised target.
• All drillhole collars were surveyed using a
Nikon Total Station (DTM-332) or Sokkia
Total Station by a Golden Star (Wassa)
surveyor.
• Wassa UG holes were drilled using HQ, NQ
or NQ2 (50.6 mm) core size. Downhole
surveying was conducted using a Reflex
multi-shot downhole surveying tool. Drill
hole collar locations were captured by the
underground mine surveying team.
Drill sample
recovery
• Method of recording and assessing core and
chip sample recoveries and results assessed.
• Measures taken to maximise sample recovery
and ensure representat ive nature of the
samples.
• Whether a relationship exists between sample
recovery and grade and whether sample bias
may have occurred due to preferential loss/gain
of fine/coarse material.
• Sample recovery is good across all deposits
drilled to date.
• There was no relationship between sample
recovery and grade.
Logging
• Whether core and chip samples have been
geologically and geotechnically logged to a level
of detail to support appropriate Mineral
Resource estimation, mining studies and
metallurgical studies.
• Whether logging is qualitat ive or quantitative in
nature. Core (or costean, channel, etc.)
photography.
• The total length and percentage of the relevant
intersections logged.
• All borehole cores were logged by
geologists.
Sub-sampling
techniques and
sample
preparation
• If core, whether cut or sawn and whether
quarter, half or all core taken.
• If non-core, whether riffled, tube sampled, rotary
split, etc. and whether sampled wet or dry.
• For all sample types, the nature, quality and
appropriateness of the sample preparation
technique.
• Quality control procedures adopted for all sub-
sampling stages to maximize representivity of
samples.
• Measures taken to ensure that the sampling is
representative of the in s itu material collected,
including for instance results for field
duplicate/second-half sampling.
• Whether sample sizes are appropriate to the
grain size of the material being sampled.
• Half core taken for DD samples.
• Sub-sampling of RC samples was carried
out using a Jones Riffle splitter.
• GSR has a standard approach to drilling
and sampling on all mining leases and
prospecting licenses.
• Sampling is typically carried out along the
entire mineralised drilled length.
• Sample preparation is to industry standard
involving drying, crushing and pulverizing of
the entire sample.
• Sample sizes are c onsidered appropriate.
• Sample weights were sufficient for the
mineralised materials.
– IIIC-285 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1811 ---
Criteria Explanation Commentary
Quality of assay
data and
laboratory tests
• The nature, quality and a ppropriateness of the
assaying and laboratory procedures used and
whether the technique is considered partial or
total.
• For geophysical tools, spectrometers, handheld
XRF instruments, etc., t he parameters used in
determining the analysis including instrument
make and model, reading times, calibrations
factors applied and their derivation, etc.
• Nature of quality cont rol procedures adopted
(e.g. standards, blanks, duplicates, external
laboratory checks) and whether acceptable
levels of accuracy (i.e. lack of bias) and precision
have been established.
• Sample assays have been performed at the
Wassa Site Laboratory (WSL), SGS Tarkwa
or Intertek Minerals Ltd (formerly named
Transworld Ltd).
• The sample preparation and analytical
processes at the WSL, Intertek, and SGS
differ slightly.
• AAS for gold grade determination.
• GSR changed the assay procedure from the
50 g fire assay method to 1 kg BLEG assay
because a component of coarse gold was
present in the samples.
• GSR QA/QC program includes inserting
blanks, Certified Reference Materials
(CRMs), and pulp or coarse reject
duplicates into sample batches, before
sample submission to the lab.
Verification of
sampling and
assaying
• The verification of significant intersections by
either independent or alternative company
personnel.
• The use of twinned holes.
• Documentation of prima ry data, data entry
procedures, data verif ication, data storage
(physical and electronic) protocols.
• Discuss any adjustm ent to assay data.
• Analytical data is also routinely checked for
consistency by GSR.
• SRK has obtained and reviewed the QA/QC
results produced by GSR.
• SRK is of opinion t hat the QA/QC samples’
performance are of industrial standard,
which provides sufficient confidence for the
mineral resource estimation.
Location of data
points
• Accuracy and quality of surveys used to locate
drill holes (collar and down-hole surveys),
trenches, mine workings and other locations
used in Mineral Resource estimation.
• Specification of the grid system used.
• Quality and adequacy o f topographic control.
• All drillhole collars were surveyed using a
Nikon Total Station (DTM-332) or Sokkia
Total Station by a Golden Star (Wassa)
surveyor.
• Wassa UG drill hole collar locations were
captured by the underground mine
surveying team.
Data spacing and
distribution
• Data spacing for reporting of Exploration
Results.
• Whether the data spaci ng and distribution is
sufficient to establish the degree of geological
and grade continuity appropriate for the Mineral
Resource and Ore Reserve estimation
procedure(s) and classifications applied.
• Whether sample composit ing has been applied.
• For Wassa, the final  drilling density for
classification as Measured Mineral
Resource is designed to be 15 m along
strike and 13 m down dip, or tighter.
• For the 242 I Zone, DMH, blocks in the
areas with drill hole spacing not more than
15m were classified as Measured Mineral
Resources.
• Composites were applied.
Orientation of data
in relation to
geological
structure
• Whether the orientation of sampling achieves
unbiased sampling of possible structures and
the extent to which this is known, considering the
deposit type.
• If the relationship between the drilling orientation
and the orientation of key mineralised structures
is considered to have introduced a sampling
bias, this should be assessed and reported if
material.
• Drill orientation varies by location within the
deposit.
• Drilling orientation is  not considered to have
introduced any sampling bias.
• No orientation-based sampling bias has
been identified.
Sample security • The measures taken to ens ure sample security.
• Samples are trucked by road to the
laboratories in Tarkwa.
• As the samples are loaded, they are
checked, and the sample numbers are
– IIIC-286 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1812 ---
Criteria Explanation Commentary
validated. The sample dispatch forms are
signed off by the driver and a company
representative. The sample dispatch dates
are recorded in the sample database as well
as the date when results are received.
Audits or reviews
• The results of any audits or reviews of sampling
techniques and data.
• As part of the Mineral R esource estimation,
SRK conducted a review of sampling
methods and data and determined that the
database was of adequate quality to support
the Mineral Resource estimation.

– IIIC-287 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1813 ---
Section 2: Reporting of Exploration Results
(Criteria listed in the preceding section also apply to this section.)
Criteria Explanation Commentary
Mineral tenement
and land tenure
status
• Type, reference name/number, location and
ownership including agreements or material
issues with third parties such as joint ventures,
partnerships, overriding royalties, native title
interests, historical sites, wilderness or national
park and environmental settings.
• The security of the tenure held at the time of
reporting along with any known impediments to
obtaining a licence to operate in the area.
• GSR possesses three mining licenses,
Wassa, Hwini-Butre and Benso.
• GSR possesses four prospecting licenses,
Benso, Manso 1, Dwaben and Manso 2.
• Wassa mining license was current granted
on 26 January 2022, and will be expire on
of 25 January 2047, with an area of 63 km2.
• Hwini-Butre and Benso mining license were
current granted on 25 August 2020, with
areas of 43 km2 and 19.45 km2 respectively.
• Manso 1 and Manso 2 prospecting licenses
were current granted on 3 April 2022, with
areas of 101.57 km 2 and 23.41 km 2
respectively.
• Benso and Dwaben licenses are renewing
and waiting for the approval of Minister of
Lands and Natural Resources, Ghana.
Exploration done by
other parties
• Acknowledgment and appraisal of exploration
by other parties.
Wassa
• The Wassa area has experienced local
small-scale and colonial mining activity
since the beginning of the 20th century
with numerous small pits and adits
evident.
• From 1988, the property was operated as
a small-scale mining operation with a
gravity gold recovery circuit by WMRL, a
Ghanaian company.
• Exploration drilling commenced in
February 1994 and by March 1997 58,709
m of drilling had been completed.
• First ore was mined from the open pit in
October 1998.
Hwini Butre, Benso and Chichiwelli
• Early European reports indicate the
Dabokrom area, around Hwini Butre, may
have been a major source for gold sold to
Portuguese explorers when they first
arrived in Ghana in the late 1400’s.
• The Dabokrom concession was acquired
by BD Goldfields (BDG) during the 1980’s
who invited Danish company Lutz
Resources Limited to carry out preliminary
exploration on the property.
• SJR began exploring the concession in
February 1995 which represented the first
sustained exploration program on the
concession.
– IIIC-288 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1814 ---
Criteria Explanation Commentary
• Reconnaissance work at Chichiwelli,
Subriso, Denerawah and Amantin was
conducted by BHP Billiton from 1989-92,
on what is now the Benso concession.
• Canadian company Fairstar Exploration
Limited took over the Benso concession in
1995 and carried out extensive work,
particularly at Subriso and Amantin.
• From early 2002 to about mid-2004, SJR
focused mainly on the Subriso area where
substantial mineralisation was outlined at
two prospects, Subriso East and West.
Geology
• Deposit type, geological setting and style of
mineralisation.
• The Wassa deposit is located on the
eastern flank of the northeast trending
Ashanti Belt, a Paleoproterozoic
greenstone belt which was formed and
deformed, along with the dividing Birimian
and Tarkwaian sedimentary basins during
the Eoeburnean and Eburnean orogeny.
The Wassa mineralisation consists of
greenstone-hosted, low sulphide
hydrothermal deposits where gold
mineralisation occurs within folded quartz-
carbonate veins.
The Wassa deposit can therefore be
classified as an Eoeburnean folded vein
system and is the only such deposit
recognised to date within the Ashanti belt.
• The Hwini Butre deposits can be
characterized as mafic intrusive hosted,
orogenic shear zones. The deposits are
hosted within diorite and granodiorite
intrusive rocks of the Mpohor complex.
The Father Brown deposit is characterized
by well-developed fault-filled quartz veins.
• The Benso deposit s can also be
characterized as mafic intrusive hosted,
orogenic shear zones deposits, which are
hosted by Birimian metavolcanics into
which coarse plagioclase porphyry units
have intruded and are generally
conformable with the volcaniclastic units.
• The Chichiwelli deposits can also be
characterized as mafic intrusive hosted,
orogenic shear zones, the deposits are
hosted within diorite and granodiorite
intrusive rocks. The mineralisation zones
at Chichiwelli are similar to those observed
at Benso, with the mineralised hosting
structures generally dipping to the east.
– IIIC-289 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1815 ---
Criteria Explanation Commentary
Drill hole
Information
• A summary of all information material to the
understanding of the exploration results
including a tabulation of the following
information for all Material drill holes:
• easting and northing of the drill hole collar
• elevation or RL (Reduced Level – elevation
above sea level in metres) of the drill hole collar
• dip and azimuth of the hole
• down hole length and interception depth
• Hole length.
• If the exclusion of this information is justified on
the basis that the information is not Material and
this exclusion does not detract from the
understanding of the report, the Competent
Person should clearly explain why this is the
case.
• Surveys are conducted on drill hole collars
(by total station) and downhole (by either
multi-shot downhole camera, or gyro
instrument for deeper holes).
• For B Shoot, the Mineral Resource
database includes 3,755 DD holes and
485 RC holes.
• For 242, the Mineral Resource database
includes 190 DD holes and 4,411 (GC)RC
holes.
• For I Zone, the Mineral Resource
database includes 21 DD holes and 233
(GC)RC holes.
• For FB/ADK, the Mineral Resource
database includes 435 DD holes and
3,301 (GC)RC holes.
• For Chichiwelli, the Mineral Resource
database includes 23 DD holes and 483
RC holes.
• All information of boreholes were
collected, including collar, elevation,
survey, depth, weathering data, specific
gravity/ density, lithology etc.
Data aggregation
methods
• In reporting Exploration   Results, weighting
averaging techniques, maximum and/or
minimum grade truncations (e.g. cutting of high
grades) and cut-off grades are usually Material
and should be stated.
• Exploration data is reported as the average
sample grade. Top cutting was used report
the exploration results. For each
mineralised domain of B shoot, 242, DMH
and I Zone, the coefficient of variation (CV),
probability plots were used to determine the
capping grade. For each domain of Hwini
Butre, the capping values were selected
from the probability plots. For each domain
of Chichiwelli, the caps were determined
based on the shape of the tail of the log
histogram and the log probability plots.
• No such aggregate intercepts short lengths
of high-grade results or longer lengths of
low-grade results is presented.
• No metal equivalent values have been
used.
• Where aggregate interc epts incorporate short
lengths of high-grade results and longer lengths
of low grade results, the procedure used for such
aggregation should be stated and some typical
examples of such aggregations should be
shown in detail.
• The assumptions used for any reporting of metal
equivalent values should be clearly stated.
Relationship
between
mineralisation
widths and
intercept lengths
• These relationships are particularly important in
the reporting of Exploration Results.
• Mineralisation intercept lengths were
reported.
• Drill dip varies by location within the
deposit. • If the geometry of the mineralisation with respect
to the drillhole angle is known, its nature should
be reported.
• If it is not known and only the down hole lengths
are reported, there should be a clear statement
to this effect (e.g. ‘down hole length, true width
not known’).
Diagrams
• Appropriate maps and sections (with scales) and
tabulations of intercepts should be included for
any significant discovery being reported These
should include, but not be limited to a plan view
of drill hole collar locations and appropriate
sectional views.
• Appropriate maps and typical sections
were reported in this report.
– IIIC-290 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1816 ---
Criteria Explanation Commentary
Balanced reporting
• Where comprehensive reporting of all
Exploration Results is not practicable,
representative reporting of both low and high
grades and/or widths should be practiced to
avoid misleading reporting of Exploration
Results.
• Reporting was fully representative of the
data collected at this stage.
Other substantive
exploration data
• Other exploration data, if meaningful and
material, should be reported including (but not
limited to): geological observations; geophysical
survey results; geochemical survey results; bulk
samples – size and method of treatment;
metallurgical test results; bulk density,
groundwater, geotechnical and rock
characteristics; pot ential deleterious or
contaminating substances.
• No additional information was provided.
Further work
• The nature and scale of planned further work
(e.g. tests for lateral extensions or depth
extensions or large-scale step-out drilling).
• Diagrams clearly highlighting the areas of
possible extensions, including the main
geological interpretations and future drilling
areas, provided this information is not
commercially sensitive.
• Further drilling program is recommended
due to Wassa’s large portion of Inferred
Mineral Resources.
– IIIC-291 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1817 ---
Section 3: Estimation and Reporting of Mineral Resources
(Criteria listed in section 1, and where relevant in section 2, also apply to this section.)
Criteria Explanation Commentary
Database integrity
• Measures taken to ensur e that data has not
been corrupted by, for example, transcription
or keying errors, between its initial collection
and its use for Mineral Resource estimation
purposes.
• Data validation procedures used.
• Digitalized Mineral Resource databases were
provided to SRK, and SRK conducted
crossing-checking against logging data and
typical interpretation. All relevant data was
imported to Leapfrog ™, and validation
routines were run to confirm validity of all data.
• Checks for holes without samples.
• Checks for duplicate samples.
• Checks and adjusts the missing or wrong
intervals.
Site visits
• Comment on any site visits undertaken by the
Competent Person and the outcome of those
visits.
• If no site visits have been undertaken indicate
why this is the case.
• Four site visits were carried out by SRK with
assistance from Golden Star personnel
during preparation of the Report.
• 7 to 10 December 2022, by geologist,
geotechnical engineer, processing engineer
and environment scientist.
• 10 to 14 January 2023, by mining engineer
and underground geotechnical engineer.
• 11 to 16 February 2024, by geologist.
• 27 to 29 May 2024, b y geologist, mining
engineer, processing engineer and
environmental consultant.
Geological
interpretation
• Confidence in (or conversely, the uncertainty
of the geological interpretation of the mineral
deposit.
• Nature of the data used and of any
assumptions made.
• The effect, if any, of alternative
interpretations on Mineral Resource
estimation.
• The use of geology in guiding and controlling
Mineral Resource estimation.
• The factors affecting co ntinuity both of grade
and geology.
• The mineralisation boundaries were
determined by lithological and sampling data.
• For B Shoot, the miner alised wireframes
were modelled by GSR using Leapfrog™
within two type envelops, with cut-off grade of
0.4 g/t and 1.2 g/t respectively.
• For 242 and DMH, the mineralised
wireframes were modelled by GSR using
Leapfrog™ within two type envelops, with
cut-off grade of 0.4 g/t and 1.0 g/t
respectively.
• For I Zone, the mineral ised domains were
generated at a cut-off of 0.5 g/t.
• For FB/ADK, the soli ds were created by GSR
and Resource Modelling Solutions (RMS).
• For Chichiwelli, the mineralised solids were
conducted by GSR with the 2D polylines
using a cut-off grade of 0.5 g/t.
Dimensions
• The extent and variability of the Mineral
Resource expressed as length (along strike
or otherwise), plan width, and depth below
surface to the upper and lower limits of the
Mineral Resource.
• The Wassa mineralisation is subdivided into
several domains; namely F Shoot, B Shoot,
242, Southeast, Starter, 419, Mid East and
Dead Man’s Hill. Each of these represents
discontinuous segments of the main
mineralised system which extends for
approximately 3.5 km along strike from
surface and is still open at depth.
• The mineralisation generally consists of
broadly tabular zones containing
dismembered and folded ribbon-like bodies
of narrow quartz vein material, zones are
typically 10 m to 50 m wide within a 900 m
– IIIC-292 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1818 ---
Criteria Explanation Commentary
mineralised corridor.
Estimation and
modelling
techniques
• The nature and appropriateness of the
estimation technique(s) applied and key
assumptions, including treatment of extreme
grade values, domaining, interpolation
parameters and maximum distance of
extrapolation from data points. If a computer
assisted estimation method was chosen
include a description of computer software
and parameters used.
• The availability of check estimates, previous
estimates and/or mine production records
and whether the Mineral Resource estimate
takes appropriate account of such data.
• The assumptions made regarding recovery of
by-products.
• Estimation of deleterio us elements or other
non-grade variables of economic significance
(e.g. sulphur for acid mine drainage
characterisation).
• In the case of block model interpolation, the
block size in relation to the average sample
spacing and the search employed.
• Any assumptions behind modelling of
selective mining units.
• Any assumptions about correlation between
variables.
• Description of how the geological
interpretation was u sed to control the
resource estimates.
• Discussion of basis for using or not using
grade cutting or capping.
• The process of validation, the checking
process used, the comparison of model data
to drill hole data, and use of reconciliation
data if available.
• For B Shoot, 242, DMH, Chichiwelli and I
Zone, Au was estimated using Ordinary
Kriging (“OK”).
The solid models for Father Brown (“FBZ”)
and Adoikrom (“ADK”) were created by GSR
and Resource Modelling Solutions (“RMS”).
They were modelled using a vein modelling
technique, with estimating both vein thickness
and grade.
• This is the first Mineral Resource estimation
in accordance with JORC Code.
• For B Shoot and 242, the block model was
constructed using a block size of to 5 m × 10
m × 5 m (East × North × Elevation), with a
sub block size of 1.25 m × 2.5 m × 2.5 m.
For DMH, the block model was constructed
using a block size of to 5 m × 5 m × 3 m (East
× North × Elevation), with a sub block size of
1.25 m × 1.25 m × 1.5 m.
For I Zone, the block model was constructed
using a block size of to 10 m × 20 m × 6 m
(East × North × Elevation), with a sub block
size of 1.25 m × 2.5 m × 1.5 m.
For FBA/ADK, the block model was
constructed using a block size of to 1 m × 2 m
× 2 m (East × North × Elevation).
For Chichiwelli, the block model was
constructed using a block size of to 12.5 m ×
25 m × 8 m (East × North × Elevation.
• All samples were composited to 1-meter.
• The cumulative frequency and distribution
characteristics of the sample histogram were
used to do the top capping.
• SRK has validated bot h block models by
swath plot and visual inspection, indicating
that the models were validated.
Moisture
• Whether the tonnages  estimated on a dry
basis or with natural moisture, and the
method of determination of the moisture
content.
• The tonnages are estim ated on a dry basis.
Cut-off parameters
• The basis of the adopted cut-off grade(s) or
quality parameters applied.
• The underground Mineral Resources were
reported within the Mineable Stope Optimiser
(“MSO”), based on a US$2,050/ ounce (oz)
gold price and mining, processing and
general administrative costs that were
adjusted from actual costs at the Wassa B
Shoot and 242 underground operations.
• Open pit Mineral Resources were reported
within the optimised/ designed open pit shell.
• Underground Mineral Resources are reported
at a cut-off grade of 1.38 g/t for B Shoot and
242 and 1.40 g/t for FB/ ADK.
• Open pit Mineral Resources are reported at a
cut-off grade of 0.438 g/t for DMH, 0.749 g/t
– IIIC-293 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1819 ---
Criteria Explanation Commentary
for I Zone and 0.55 g/t for Chichiwelli.
Mining factors or
assumptions
• Assumptions made regarding possible
mining methods, minimum mining
dimensions and internal (or, if applicable,
external) mining dilution. It is always
necessary as part of the process of
determining reasonable prospects for
eventual economic extraction to consider
potential mining methods, but the
assumptions made regarding mining
methods and parameters when estimating
Mineral Resources may not always be
rigorous. Where this is the case, this should
be reported with an explanation of the basis
of the mining assumptions made.
• B Shoot and 242 are two active underground
mining operations. DMH is an active open pit
operation.
• The mining method for FBZ/ ADK is
underground mining, for I Zone and
Chichiwelli is open pit mining.
• Underground Mineral Resources are
reported within MSO and open pit Mineral
Resources are reported within the optimised/
designed open pit shells.
• This assists in demonstrating that the Mineral
Resource meets the requirement of having
reasonable prospects for eventual economic
extraction criteria.
Metallurgical factors
or assumptions
• The basis for assumptions or predictions
regarding metallurgical amenability. It is
always necessary as part of the process of
determining reasonable prospects for
eventual economic extraction to consider
potential metallurgical methods, but the
assumptions regarding metallurgical
treatment processes and parameters made
when reporting Mineral Resources may not
always be rigorous. Where this is the case,
this should be reported with an explanation of
the basis of the metallurgical assumptions
made.
• Wassa Gold Mine is a production project,
both metallurgical testing and historical
production performance data are available,
providing reliable data to Metallurgical
Factors.
• The oxide and primary ore of Wassa deposit
are amenable to cyanide leaching (“CIL”).
The CIL with Gravity Separation is a suitable
process for gold extraction. Gold recovery of
90% to 95% can be achieved.
Environmental
factors or
assumptions
• Assumptions made regarding possible waste
and process residue disposal options. It is
always necessary as part of the process of
determining reasonable prospects for
eventual economic extraction to consider the
potential environmental impacts of the mining
and processing operation. While at this stage
the determination of pot ential environmental
impacts, particularly for a greenfields project,
may not always be well advanced, the status
of early considerati on of these potential
environmental impacts should be reported.
Where these aspects have not been
considered this should be reported with an
explanation of the environmental
assumptions made.
• The EIS reports have been completed and
approved for the Wassa Gold Project,
covering the current mining areas, the
processing plant, the tailings storage
facilities, and the expansion project.
Bulk density
• Whether assumed or determined. If
assumed, the basis for the assumptions. If
determined, the method used, whether wet or
dry, the frequency of the measurements, the
nature, size and representativeness of the
samples.
• The bulk density for bulk material must have
been measured by methods that adequately
account for void spaces (vugs, porosity, etc),
moisture and differences between rock and
alteration zones within the deposit.
• For B Shoot and 242 underground, the bulk
density in the model was set to 2.8 (fresh
rock).
• For DMH and I Zone, t he density values for
the tonnage estimation were coded to 1.8
g/cm3 for oxide, 2.25 g/cm3 for transition and
2.7 g/cm3 for fresh by GSR.
• For FBZ/ADK, the density used for estimation
was provided by GSR with the value of 2.7
g/cm3.
• For Chichiwelli, the density values used for
– IIIC-294 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1820 ---
Criteria Explanation Commentary
• Discuss assumptions for bulk density
estimates used in the evaluation process of
the different materials.
the estimation were provided by GSR with
the values of 1.8 g/cm3 for oxide and 2.68
g/cm3 for fresh.
Classification
• The basis for the classification of the Mineral
Resources into varying confidence
categories.
• Whether appropriate account has been taken
of all relevant factors (ie relative confidence
in tonnage/grade estimations, reliability of
input data, confidence in continuity of
geology and metal values, quality, quantity
and distribution of the data).
• Whether the result appr opriately reflects the
Competent Person’s view of the deposit.
• B Shoot
Measured Mineral Resources were defined
in areas the drill intercepts were no greater
than 15 m.
Indicated Mineral Resources were defined in
areas the drill intercepts were no greater than
50 m.
The rest within each domain with little known
information is classified  as Inferred Mineral
Resources.
• 242
The blocks in the areas with drill hole spacing
not more than 15m were classified as
Measured Mineral Resources, those with drill
hole spacing not greater than 30m were
classified as Indicated Mineral Resources
and those with drill hole spacing not greater
than 45m were classified as Inferred Mineral
Resources.
• DMH
Blocks in the areas with drill hole spacing not
more than 15m were classified as Measured
Mineral Resources, those with drill hole
spacing not greater than 30m were classified
as Indicated Mineral Resources and the rest
within mineralised domains were classified
as Inferred Mineral Resources.
• I Zone
Measured Mineral Resource was defined by
the area with an average sample distance of
15 m. Indicated Mineral Resource was
defined by the area with a sample distance of
30 m. And the rest within the mineralise
domain was defined as Inferred Mineral
Resources.
• FBA/ADK
Indicated Mineral Resources were classified
in the areas where drilling is sufficient to
demonstrate geological and grade continuity
to a reasonable level.
Inferred Mineral Resources were classified
by two 3D solids that included the wider
spaced drilling at depth (100 to 200m
spacing),
• Chichiwelli
Wireframes were digitized for East Domain
and West Domain, with the areas inside the
modelled solids considered to be Indicated
Mineral Resources, and outside, Inferred
Mineral Resources.
– IIIC-295 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1821 ---
Criteria Explanation Commentary
Audits or reviews
• The results of any audits or reviews of
Mineral Resource estimates.
• The input data, including geological
mapping and drillhole data are
comprehensive in their coverage of the
mineralisation.
• The Mineral Resource estimate
appropriately reflects the view of the
Competent Person.
• The relative accuracy of the Mineral
Resource estimate is reflected in the
reporting of the Mineral Resource as per
the guidelines of the JORC Code.
• The statement relates to global volumetric
estimates.
– IIIC-296 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1822 ---
Section 4: Estimation and Reporting of Ore Reserves
(Criteria listed in section 1, and where relevant in sections 2 and 3, also apply to this section.)
Criteria Explanation Commentary
Mineral Resource
estimate for
conversion to
Ore Reserves
• Description of the Mineral Resource estimate
used as a basis for the conversion to an Ore
Reserve.
• Clear statement as to whether the Mineral
Resources are reported additional to, or
inclusive of, the Ore Reserves.
• The open pit Ore Reserv es are based on a
block model and Mineral Resource estimate
discussed in section three.
• The underground Ore Reserves are based on
a block model and Mineral Resource estimate
discussed in section three.
• The stockpile Ore Reserv e is the ore that has
spilled from conveyor belts and accumulated
over time and are subsequently returned to the
ROM Pad.
• Inferred Mineral Resources have been
excluded from this estimate.
• The reported Ore Reserves are included in the
tonnage of Measured and Indicated categories
of Mineral Resources and diluted material.
Site visits
• Comment on any site visits undertaken by the
Competent Person and the outcome of those
visits.
• If no site visits have been undertaken indicate
why this is the case.
• Four site visits were carried out by SRK with
assistance from GSR personnel during
preparation of the Report.
• 7 to 10 December, 2022, by geologist,
geotechnical engineer, processing engineer
and environment scientist.
• 10 to 14 January 2023, by mining engineer
and underground geotechnical engineer.
• 11 to 16 February, 2024, by geologist.
• 27 to 29 May 2024, b y geologist, mining
engineer, processing engineer and
environmental consultant.
• Ali Rudaki, a Principal Mining Engineer from
SRK Consulting South Africa, conducted a site
visit from 10 to 13 January 2023.
• TzuHsuan (Shan) Chuang, a Senior Mining
Engineer from SRK Consulting China,
conducted a site visit from 27 to 29 May 2024.
Study status
• The type and level of study undertaken to
enable Mineral Resources to be converted to
Ore Reserves.
• The Code requires that a study to at least Pre-
Feasibility Study level has been undertaken to
convert Mineral Resources to Ore Reserves.
Such studies will have been carried out and
will have determined a mine plan that is
technically achievable and economically
viable, and that material Modifying Factors
have been considered.
• The Wassa Mine is an o perational mine with
open pit and underground mining. Open pit
mining commenced in 2007 and underground
mining commenced in2016.
• SRK Consulting (UK) Lt d. (2015) and Golden
Star Resources Ltd (2021) provided the basis
for the Ore Reserves estimate, referencing the
NI 43-101 Technical Report on the Wassa
Open Pit Mine and Underground Project in
Ghana (2015), and the NI 43-101 Technical
Report on the Wassa Gold Mine (2021).
• The feasibility study, alo ng with the operational
data and production plan, constitutes the
foundational basis for the conversion of Ore
Reserves.
Cut-off
parameters
• The basis of the cut-off grade(s) or quality
parameters applied.
• Open Pit Mines:
Revenue Parameters:
o Gold price: 2,050 USD/oz
o Process plant recovery: 95.5%
o Government and royalty: 13.5% of
revenue
– IIIC-297 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1823 ---
Criteria Explanation Commentary
Costs Parameters:
o Base Mining cost (Ox / Fr): 3.1/ 4.2 USD/t
o Haul to Plant: 0.3 USD/t
o Process Cost: 15.09 USD/t
o Dilution: 10%
o Gold Cut-off Grade: 0.5 g/t

• Underground Mines:
Revenue Parameters:
o Gold Price: 2,050 USD/oz
o Process Plant Gold R ecovery: 95.5%
o Mining royalty of 5 % and gold royalty of
8.3%;
Cost Parameters:
o Mine Production: 42.47 USD/t
o Sustaining Capital: 8.08 USD/t
o Processing: 14.93 USD/t
o Site G&A: 7.23 USD/t
Gold Cut-Off Grade: 1.34 g/t
• The Ore Reserves were reported based on the
above respective cut-off grade estimation.
Mining factors or
assumptions
• The method and assumptions used as
reported in the Pre-Feasibility or Feasibility
Study to convert the Mineral Resource to an
Ore Reserve (i.e. either by application of
appropriate factors by optimisation or by
preliminary or detailed design).
• The choice, nature and appropriateness of the
selected mining method(s) and other mining
parameters including associated design
issues such as pre-strip, access, etc.
• The assumptions made regarding
geotechnical parameters (e.g. pit slopes,
stope sizes, etc.), grade control and pre-
production drilling.
• The major assumptions made and Mineral
Resource model used for pit and stope
optimisation (if appropriate).
• The mining dilution factors used.
• The mining recovery factors used.
• Any minimum mining widths used.
• The manner in which Inferred Mineral
Resources are utilised in mining studies and
the sensitivity of t he outcome to their
inclusion.
• The infrastructure requirements of the
selected mining methods.
• Underground:
o Mineable Stope Optimiser (MSO)
o Vertical Method: YZ plane
o Minimum Mining Width: 5 meters
o Maximum Mining Width: 60 meters
o Stope Pillar: 10 meters
o Cut-off Grade: 1.34 g/t Au
o Wall Minimum Dip: 80°
o Wall Maximum Dip: 100°
o Variable Overbreak or Slough (VOS):
o Bottom: 0.2
o Midpoint: 0.4
o Top: 0.8
o Section (Length) Intervals: 20 meters
o Level (Height) Intervals: 25 meters
o Sections (U): Variable based on mining
method and mining lode
o Dilution/ Recovery:
o Development (gold >= Development cut-
off grade): 0% dilution, 100% recovery
o Development (gold < Development cut-off
grade): 14% dilution, 100% recovery
o Stope: 10% dilution, 95% recovery
• Open Pit:
o Ore Reserves are based on open pit
shape designs, with appropriate
modifications made to the original Whittle
Shell outlines (Lercsh Grossman open pit
optimisations) to ensure they meet
practical mining parameters.
o No additional mining dilution or recovery
factors were applied, as the regularized
model already accounts for both dilution
and mining recovery.
o The open pit design includes a 20-meter-
wide ramp with a 10% gradient, which is
wide enough for two-way hauling using
60-ton capacity off-highway haul trucks.
– IIIC-298 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1824 ---
Criteria Explanation Commentary
o The open pit design incorporates slopes
and benches based on historical
geotechnical data for the open pits in the
area, featuring an overall slope angle of
40° in the weathered zone and 52° in
fresh rock. The bench height is set at 12
meters, with a 72° bench face angle, while
drilling and blasting will be conducted over
bench heights of 6 meters.
• Two mining methods were applied depending
on the material. Oxide or weathered material
was typically excavated using the free-dig
method. For fresh material, conventional
mining techniques were used, drill, blast, load
and haul, involving hydraulic excavators and
blasting to flitches with a height of 3.0 meters.
The broken rock was then loaded onto 60-ton
capacity off-highway haul trucks and
transported to a central stockpile or waste
dump.
Metallurgical
factors or
assumptions
• The metallurgical process proposed and the
appropriateness of that process to the style of
mineralisation.
• Whether the metallurgical process is well-
tested technology or novel in nature.
• The nature, amount and representativeness
of metallurgical test work undertaken, the
nature of the metallurgical domaining applied
and the corresponding metallurgical recovery
factors applied.
• Any assumptions or allowances made for
deleterious elements.
• The existence of any bulk sample or pilot
scale test work and the degree to which such
samples are considered representative of the
orebody as a whole.
• For minerals that are defined by a
specification, has the ore reserve estimation
been based on the appropriate mineralogy to
meet the specifications?
• Wassa Gold Mine is a production project, both
metallurgical testing and historical production
performance data are available, providing
reliable data to Metallurgical Factors.
• The oxide and primary ore of Wassa deposit are
amenable to cyanide leaching. The CIL
supplemented with Grav ity Separation is a
suitable process for gold extraction. Gold
recovery of 90% to 95% can be achieved in
laboratory tests.
• The processing plant adopt CIL with Gravity
Separation process to extract gold, and the
actual gold recovery is higher as 95% to 97% in
recent years production. Yearly gold production
(in gold Doré bars) is around five tons.
• The processing flowsheet to treat ores from
both open pit and underground operations has
been proved to be mature. Recovery methods
in the processing plant and forward recovery
assumptions and are supported by test work
and plant history production.
Environmental
• The status of studies of potential
environmental impacts of the mining and
processing operation. Details of waste rock
characterisation and the consideration of
potential sites, status of design options
considered and, where applicable, the status
of approvals for process residue storage and
waste dumps should be reported.
• Waste rocks from the proj ect are transported to
the 419 dump, part of w hich was recycled as
aggregates for construction and road works. The
EIS report states that t he waste rocks are not
acid generating (NAG) based on the
geochemical characterization. Tailings are
pumped to the TSF for storage, and return water
from the TSF is pumped back to the processing
plant for reuse. Routine analyses of cyanide
were undertaken, and all cyanide concentrations
were less than reporting limits (m RL) of 0.005
mg/L. GSWL is a memb er of International
Cyanide Management Code (ICMC).
– IIIC-299 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1825 ---
Criteria Explanation Commentary
Infrastructure
• The existence of approp riate infrastructure:
availability of land for plant development,
power, water, transportation (particularly for
bulk commodities), labour, accommodation;
or the ease with which the infrastructure can
be provided, or accessed.
• The Wassa mine is a well-established project
with 20-year production history and adequate
infrastructure. The power and water supply can
support the mining and processing capacity of
2.7Mtpa ore.
Costs
• The derivation of, or assumptions made,
regarding projected capital costs in the study.
• The methodology used to estimate operating
costs.
• Allowances made for the content of
deleterious elements.
• The derivation of assumptions made of metal
or commodity price(s), for the principal
minerals and co- products.
• The source of exchange rates used in the
study.
• Derivation of transpo rtation charges.
• The basis for forecasting or source of
treatment and refining charges, penalties for
failure to meet specification, etc.
• The allowances made for royalties payable,
both Government and private.
• Capital expenditures:
• Capitalised development: 78 million USD
(3,620.03 USD/m for underground
development).
• Other capital expendi ture: 91 million   USD
(includes mine maintenance, environment, in-
fill drilling, etc.)
• Initial working capital is assumed to be 30% of
the operating costs in 2024, fully recovered by
2028.
• Mine closure expenditure is estimated at 27
million USD and allocate evenly over the LOM.
• Operating costs were  categorized into the
following components: labor, material,
electricity, contractors, engineering, service,
safety, repairment, others, taxes and
surcharges, selling costs, G&A costs, R&D
cost.
Income tax is 35%.
Revenue factors
• The derivation of, or assumptions made
regarding revenue factors including head
grade, metal or commodity price(s) exchange
rates, transportation and treatment charges,
penalties, net smelter returns, etc.
• The derivation of assumptions made of metal
or commodity price(s), for the principal metals,
minerals and co-products.
• For economic analysis , gold metal price was
dynamic and was derived from consensus
market forecasts provided by the Energy and
Metals Consensus Forecast, published by
Consensus Economics Inc., to which SRK
subscribes annually.
• There is no other revenue factor considered.
• A 99.1% payable rate is applied to the metal
price based on Wassa’s cost analysis.
Market
assessment
• The demand, supply and stock situation for
the particular commodity, consumption trends
and factors likely to affect supply and demand
into the future.
• A customer and competitor analysis along
with the identification of likely market windows
for the product.
• Price and volume forecasts and the basis for
these forecasts.
• For industrial minerals the customer
specification, testing and acceptance
requirements prior to a supply contract.
• The market of the commodity of gold is well
established and analysed.
• The gold industry is a mature commodity market
comparing to other commodities in mining.
• The gold price forecast used in this Report is
referred to institutional analysis and referenced
by the past actual gold prices.
• A long term price of gold at US$ 2,050 per ounce
has been applied for Ore Reserve study and
project economics analysis.
Economic
• The inputs to the economic analysis to
produce the net present value (NPV) in the
study, the source and confidence of these
economic inputs including estimated inflation,
discount rate, etc.
• NPV ranges and sensitivity to variations in the
significant assumptions and inputs.
• The discount rate used for NPV calculation
ranges from 5.0% to 15.0%, with increments of
1.0%. All results indicate an economic outcome.
• The “nominal” values are applied. The cost
remains constant over the life of mine without
any adjustments are factored in.
• The operating costs, capital expenditure, and
gold prices were sele cted for sensitivity
analysis. These factors were analysed within a
– IIIC-300 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1826 ---
Criteria Explanation Commentary
±30% range for their impact on NPV, using a
10% discount rate.
• The NPV is most sensitive to changes in the
gold price, followed by operating costs.
Social
• The status of agreements with key
stakeholders and matters leading to social
licence to operate.
• The public consultation of the EIS report shows
that stakeholders have generally expressed
their support for the project and willingness to
engage with the company to enhance benefits.
GSWL actively engages in a range of cooperate
social responsibility strategies  to cultivate
strong relationships and highlight the value-
adding potential of key stakeholders.
Other
• To the extent relevant, the impact of the
following on the Project and/or on the
estimation and classification of the Ore
Reserves:
• Any identified material naturally occurring
risks.
• The status of material legal agreements and
marketing arrangements.
• The status of governmental agreements and
approvals critical to the viability of the Project,
such as mineral tenement status, and
government and statutor y approvals. There
must be reasonable grounds to expect that all
necessary Government approvals will be
received within the time frames anticipated in
the Pre-Feasibility or Feasibility study.
Highlight and discuss the materiality of any
unresolved matter that is dependent on a third
party on which extraction of the reserve is
contingent.
• The current Ore Reserve estimates and
statement are based on PFS level studies, along
with the operational data and production plan,
constitutes the foundational basis for the
conversion of Ore Reserves, which is considered
appropriate by SRK.
• SRK is not aware of any material risk in social or
legal aspects that will impact on the Ore Reserve
statement.
Classification
• The basis for the classification of the Ore
Reserves into varying confidence categories.
• Whether the result appropriately reflects the
Competent Person’s view of the deposit.
• The proportion of Probable Ore Reserves that
have been derived from Measured Mineral
Resources (if any).
• For the open pit and underground mining,
Measured Mineral Resources in the mine
designs are classified as Proved Ore
Reserves. Indicated Mineral Resources in the
mine designs are classified as Probable Ore
Reserves.
• For ore stockpiles, the materials are
considered as Probable Ore Reserve based on
reviewing the data provided by Wassa Mine.
• The classification of Ore Reserves
appropriately reflects the Competent Person’s
view of the deposits.
• There is no Measured  Mineral Resources,
classified as Probable Ore Reserves.
Audits or reviews • The results of any audits or reviews of Ore
Reserve estimates.
• The Ore Reserves estimates have been peer
reviewed internally and is in line with current
industry standards.
– IIIC-301 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1827 ---
Criteria Explanation Commentary
Discussion of
relative accuracy/
confidence
• Where appropriate a statement of the relative
accuracy and confidence level in the Ore
Reserve estimate using an approach or
procedure deemed appropriate by the
Competent Person. For example, the
application of statistical or geostatistical
procedures to quantify the relative accuracy of
the reserve within stated confidence limits, or,
if such an approach is not deemed
appropriate, a qualitative discussion of the
factors which could affect the relative
accuracy and confidence of the estimate.
• Accuracy and confidence discussions should
extend to specific discussions of any applied
Modifying Factors that may have a material
impact on Ore Reserve viability, or for which
there are remaining areas of uncertainty at the
current study stage.
• It is recognised that this may not be possible
or appropriate in all circumstances. These
statements of relative accuracy and
confidence of the estimate should be
compared with production data, where
available.
• The Ore Reserves estimates are based on
data (studies and assessment) provided by
Wassa Mine and ongoing operations. The Ore
Reserves estimates are at a PFS level.
• All modifying factors have been applied for Ore
Reserves estimates on a global estimate.
• Considering the Wassa project is an operating
mine with track record, SRK is of opinion that
Ore Reserve estimates based on short-term
LoM plan based on Measured and Indicated
Mineral Resources are of low risk.

– IIIC-302 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1828 ---
Appendix B Wassa Life of Mine
– IIIC-303 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1829 ---
Wassa Life of Mine
– IIIC-304 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1830 ---
Appendix C Compliance with Chapter 18
– IIIC-305 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1831 ---
Chap
ter 18 Sections in SRK’s Report
18.01 DEFINITIONS AND INTERPRETATION Not applicable. [1]
18.02-18.04 CONDITIONS FOR LISTING OF NEW APPLICANT MINERAL COM PANIES
18.02 In addition to satisfying  the requirements of Chapter 8, a Mineral Company which has
applied for listing must also satisf y the requirements of this Chapter.
18.03 A Mineral Company must:—
( 1) establish to the Exchange’s satisfaction that it has the right to participate actively in 3.1 the exploration for and/or extraction of Natural Resources, either:—
 (a) through control over a maj ority (by value) of the assets in which it has invested
 together with adequate rights over the exploration for and/or extraction of
 Natural Resources; or
 Note: ‘control over a majority’ means an interest greater than 50%.
 (b) through adequate rights (arising under arrangements acceptable to the
 Exchange), which gives it sufficient influence in decisions over the exploration
 for and/or extraction of the Natural Resources;
( 2) establish to the Exchange’s satisfaction that it has at least a portfolio of: —
Executive Summary Table ES-1,
and 10.11
 (a) Indicated Resources; o r
 (b) Contingent Resources,
identifiable under
 a Reporting Standard and substantiated in a Competent
Person’s
R
eport. This portfolio must be meaningful and of sufficient substance to justify a
listing;
(3)  if it has commenced production, provide an estimate of cash  operating costs 17.2. [2] including the costs associated with:—
 (a) workforce employment;
 (b) consumables;
 (c) fuel, electricity, water and other services;
 (d) on and off-site administration;
 (e) environmental protection and monitoring;
 (f) transportation of workforce;
 (g) product marketing and transport;
 (h) non-income taxes, royalties and other governmental charge s; and
 (i) contingency allowances;
Note
:   A Mineral Company must:
 • set out the components of cash operating costs separately by category;
 • explain the reason for any departure from the list of items to be included
 under cash operating costs; and
 • discuss any material cost items that should be highlighted to investors.
(4)  demonstrate to the Exchange’s satisfaction that it has available working capital fo r
17.1 [3] 125% of the group’s present requirements, that is for at least the next 12 months,
 which must include:—
 (a) general, administrative and operating costs;
 (b) property holding costs; and
 (c) the cost of any proposed exploration and/or development; and
Note
: Capital expenditures do not need to be included in working capital
 requirements. Where they are financed out of borrowings, relevant interest
 and loan repayments must be included.
(5)  ensure that its working capital statement in the listing document under Listing
17.1 [3] Rule 8.21A states it has sufficient available working capital for 125% of the group’s
 present requirements, that is for at least 12 months from the date of its listing
 document.
18.04 If a Mineral Company is unable to satisfy either the profit test in rule 8.05(1), the market Not applicable. [4]
c apitalisation/revenue/cash flow test in rule 8.05(2), or the market capitalisation/revenue
t est in rule 8.05(3), it may still apply to be listed if it can establish to the Exchange’s
s atisfaction that its directors and senior managers, taken together, have sufficient
e xperience relevant to the exploration and/or extraction activity that the Mineral Company
i s pursuing. Individuals relied on must have a minimum of five years relevant industry
e xperience. Details of the relevant experience must be disclosed in the listing document of
– IIIC-306 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1832 ---
Chap
ter 18 Sections in SRK’s Report
t he new applicant.
Not
e:  A Mineral Company relying on this rule must demonstrate that its primary activity is
 the exploration for and/or extraction of Natural Resources.
18.05-18.08 CONTENTS OF LISTING DOCUMENTS FOR NEW APPLICANTS
18.05 In addition to the information set out in Appendix 1A, a Mineral Company must include in
i ts listing document:—
( 1) a Competent Person’s Report; 1, 2.2.4
( 2) a statement that no material changes have occurred since the effective date of
2.4 the Competent Person’s Report. Where there are material changes, these must be
 prominently disclosed;
( 3) the nature and extent of its prospecting, exploration, expl oitation, land use and
3, 16.3
 mining rights and a description of the properties to which those rights attach,
 including the duration and other principal terms and conditions of the concessions
 and any necessary licences and consents. Details of material rights to be obtained
 must also be disclosed;
(4)  a statement of any legal claims or proceedings that may have an influence on its 2.3 rights to explore or mine;
(5) disclosure of specific risks and general risks. Companies should have regard to 19 Guidance Note 7 on suggested risk analysis; and
( 6) if relevant and material to t he Mineral Company’s business operations, information
 on the following:—
 (a) project risks arising from  environmental, social, and health and safety issues; 19
 (b) any non-governmental organisation impact on sustainability of mineral and/o r 16.4.9 exploration projects;
 (c) compliance with host country laws, regulations and permits, and payments
16.3 made to host country governments in respect of tax, royalties and other
 significant payments on a country by country basis;
 (d) sufficient funding plans for remediation, rehabilitation and closure and removal 16.4.8, 17.1[5] of facilities in a sustainable manner;
 (e) environmental liabilities o f its projects or properties; 16.4
 (f) its historical experience of dealing with host country laws and practices, 16.4.9 including management of differe nces between national and local practice;
 (g) its historical experience of dealing with concerns of local governments and
16.4.9 communities on the sites of its mines, exploration properties, and relevant
 management arrangements; and
 (h) any claims that may exist over the land on which exploration or mining activity 16.4.9 is being carried out, including any ancestral or native claims.
18.06-18.08
Additional disclosure requirements that apply to certain new applicant Mineral
Companies
18.06 If a Mineral Company has  begun production, it must disclose an estimate of the operating 17.2 cash cost per app ropriate unit for the minerals and/or Petroleum produced.
18.07 If a Mineral Company has not yet begun production, it must disclose its plans to proceed Not applicable. [6]
t o production with indicative dates and costs. These plans must be supported by at least a
S coping Study, substantiated by the opinion of a Competent Person. If exploration rights or
r ights to extract Resources and/or Reserves have not yet been obtained, relevant risks to
obtaining these rights must be pro minently disclosed.
18.08 If a Mineral Company is involved in the exploration for or extraction of Resources, it must
10 prominently disclose to investors that its Resources may not ultimately be extracted at a
profit.
18.09-18.13 RELEVANT NOTIFIABLE TRANSACTIONS INVOLVING THE ACQUISITION Not applicable. [1]
O R DISPOSAL OF MINERAL OR PETROLEUM ASSETS
18.09 A Mineral Company proposing to acquire or dispose of assets which are solely or mainly
M ineral or Petroleum Assets as part of a Relevant Notifiable Transaction must:—
( 1) comply with Chapter 14 and Chapter 14A, if relevant;
( 2) produce a Competent Person’s Report, which must form part of the relevant circular,
 on the Resources and/or Reserves being acquired or disposed of as part of the
 Relevant Notifiable Transaction;
Note
:
  The Exchange may dispense with the requirement for a Competent Person’s
– IIIC-307 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1833 ---
Chapter 18 Sections in SRK’s Report
    Report on disposals where sharehol ders have sufficient information on the
    assets being disposed of.
 (3) in the case of a major (or  above) acquisition, produce a Valuation Report, which must
  form part of the relevant circular, on the Mineral or Petrole um Assets being acquired
  as part of the Relevant Not ifiable Transaction; and
 (4) comply with the requirements of rules 18.05(2) to 18.05(6)  in respect of the assets
  being acquired.

Not
e:  Material liabilities that remain with t he issuer on a disposal must also be discussed.
18.10-18.11 Requirements that apply to listed issuers
18.10 A listed issuer proposing  to acquire assets which are solely or mainly Mineral or Petroleum
 Assets as part of a Relevant Notifiable Transaction must comply with rule 18.09.
18.11 On completion of a Relevan t Notifiable Transaction involving the acquisition of Mineral or
 Petroleum Assets, unless the Exchange decides otherwise, a listed issuer will be treated
 as a Mineral Company.
18.12-18.13 Requirements that apply to Mineral Companies and listed issuers
18.12 The Exchange may dispense wi th the requirement to produce a new Competent Person’s
 Report or a Valuation Report under rules 18.05(1), 18.09(2) or 18.09(3), if the issuer
 has available a previously published Competent Person’s Report or Valuation Report (or
 equivalent) which complies with rules 18.18 to 18.34 (where applicable), provided the
 report is no more than six months old. The issuer must provide this document and a no
 material change statement in the listing document or circular for the Relevant Notifiable
 Transaction.
18.13 An issuer must obtain the prior written consent of a Competent Person(s) or Competent
 Evaluator for their material to be included in the form and context in which it appears in
 a listing document or circular for the Relevant Notifiable Transaction, whether or not such
 person or firm is retained by the listing applicant or the issuer.
18.14-18.17 CONTINUING OBLIGATIONS Not applicable. [7]
18.14 Disclosure in reports
18.14 A Mineral Company must incl ude in its interim (half-yearly) and annual reports details
 of its exploration, development and mining production activities and a summary of
 expenditure incurred on these activities during the period under review. If there has been
 no exploration, development or production activity, that fact must be stated.
18.15-18.17 Publication of Resources and Reserves
18.15 A listed issuer that public ly discloses details of Resources and/or Reserves must give an
 update of those Resources and/or Reserves once a year in its annual report, in accordance
 with the reporting standard under which they were previously disclosed or a Reporting
 Standard.
18.16 A Mineral Company must inc lude an update of its Resources and/or Reserves in its annual
 report in accordance with the Reporting Standard under which they were previously
 disclosed.
18.17 Annual updates of Resources an d/or Reserves must comply with rule 18.18.

Not
e: Annual updates are not required to be supported by a Competent Person’s Report
  and may take the form of a no material change statement.
18.18-18.27 STATEMENTS ON RESOURCES AND/OR RESERVES
18.18 Presentation of data
18.18 Any data presented on Resources and/or Reserves by a Mine ral Company in a listing 10.11
 document, Competent Person’s Report, Valuation Report or annual report, must be 11.3
 presented in tables in a manner readily understandable to a non-technical person. All
 assumptions must be clearly disclosed and statements should include an estimate of
 volume, tonnage and grades.
18.19 Basis of evidence
18.19 All statements referring to Resources and/or Reserves: —
 (1) in any new applicant listing document or circular relating to a Relevant Notifiable

Transaction must be substantiated in a Competent Person’s Report which must form
part of the document; and
 (2) in all other cases, must a t least be substantiated by the issuer’s internal experts.
18.20 Petroleum Competent Persons’ Reports Not applicable. [8]
– IIIC-308 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1834 ---
Chapter 18 Sections in SRK’s Report
18.20 A Competent Person’s Repor t for Mineral Companies involved in the exploration for and/or
 extraction of Petroleum Resources and Reserves must include the information set out in
 Appendix 25.
18.21-18.22 Competent Person
18.21 A Competent Person must:—
 (1) have a minimum of five yea rs’ experience relevant to the style of mineralization 2.7
  and type of deposit under consi deration or to the type of Petroleum exploration,
  reserve estimate (as appropri ate), and to the activity which the Mineral Company is
  undertaking;
 (2) be professionally qualified, and be a member in good standi ng of a relevant 2.7
  Recognised Professional Organisa tion, in a jurisdiction where, in the Exchange’s
  opinion, the statutory securiti es regulator has satisfactory arrangements (either by
  way of the IOSCO Multilateral MOU or other bi-lateral agreement acceptable to the
  Exchange) with the Commission for mutual assistance and excha nge of information
  for enforcing and securing compliance with the laws and regul ations of that
  jurisdiction and Hong Kong; and
 (3) take overall responsibility for the Competent Person’s Repo rt. 2.7, 2.9
18.22 A Competent Person must be independent of the issuer, its  directors, senior management 2.7, 2.10
 and advisers. Specifically the Competent Person retained must:—
 (1) have no economic or beneficia l interest (present or contingent) in any of the assets
  being reported on;
 (2) not be remunerated with a fee dependent on the findings of  the Competent Person’s
  Report;
 (3) in the case of an individual, not be an officer, employee or proposed officer of the
  issuer or any group, holding or associated company of the issuer; and
 (4) in the case of a firm, not be a group, holding or associat ed company of the issuer.
  Any of the firm’s partners or  officers must not be officers or proposed officers of any
  group, holding or associated company of the issuer.
18.23 Additional requirements of Competent Evaluators
18.23 In addition to the requirements set out in rules 18.21(2) and 18.22, a Competent Evaluato r
 must:—
 (1) have at least ten years rele vant and recent general mining or Petroleum experience
  (as appropriate);
 (2) have at least five years rele vant and recent experience in the assessment and/or
  valuation of Mineral or Petroleum Assets or securities (as appropriate); and
 (3) hold all necessary licences.

Not
e:  A Competent Person’s Report or Valuation Report may be performed by the same
  Competent Person provided he or s he is also a Competent Evaluator.
18.24 Scope of Competent Persons’ Reports and Valuation Reports
18.24 A Competent Person’s Report o r Valuation Report must comply with a Reporting Standard
 as modified by this Chapter, and must:—
 (1) be addressed to the Mineral Company or listed issuer; 1, 2.24
 (2) have an effective date (being the date when the contents o f the Competent 2.4
  Person’s Report or Valuation Report are valid) less than six months before the
  date of publishing the listing document or circular relating to a Relevant Notifiable
  Transaction required under the Listing Rules; and
 (3) set out what Reporting Standard has been used in preparing the Competent 1, 2.24
  Person’s Report or Valuation Report, and explain any departure from the relevant
  Reporting Standard.
18.25-18.26 Disclaimers and Indemnities
18.25 A Competent Person’s Report or Valuation Report may conta in disclaimers of sections 2.11, 2.12
 or topics outside their scope of expertise in which the Competent Person or Competent
 Evaluator relied upon other experts’ opinions, but must not contain any disclaimers of the
 report in its entirety.
18.26 The Competent Person or Competent Evaluator must prominen tly disclose in the 2.11, 2.12
 Competent Person’s Report or Valuation Report the nature and details of all indemnities
 provided by the issuer. Indemnities for reliance placed on information provided by issuers
 and third party experts (for information outside the Competent Person’s or Competent
– IIIC-309 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1835 ---
Chapter 18 Sections in SRK’s Report
 Evaluator’s expertise) are generally acceptable. Indemnities for fraud and gross negligence
 are generally unacceptable.
18.27 Obligations of sponsor Not applicable.[1]
18.27 Any sponsor appointed to or by a new applicant Mineral Company under Chapter 3A must
 ensure that any Competent Person or Competent Evaluator meets the requirements of
 this Chapter.
18.28-18.34 REPORTING STANDARD
18.28-18.30 Mineral reporting standard
18.28 In addition to satisfying  the requirements of Chapter 13 (as modified by this Chapter), a
 Mineral Company exploring for and/or extracting mineral Resources and Reserves must
 also satisfy rules 18.29 and 18.30.
18.29 A Mineral Company must di sclose information on mineral Resources, Reserves and/or 1, 2.2.4
 exploration results either:—
 (1) under:
  (a) the JORC Code; 1, 2.2.4
  (b) NI 43-101; o r
  (c) the SAMREC Code,
  as modified by this Chapter; o r
 (2) under other codes acceptable  to the Exchange as communicated to the market
  from time to time, provided t he Exchange is satisfied that they give a comparable
  standard of disclosure and sufficient assessment of the under lying assets.

Not
e:  The Exchange may allow presentation of Reserves under other reporting standards
  provided reconciliation to a Reporting Standard is provided. A Reporting Standard
  applied to specific assets  must be used consistently.
18.30 A Mineral Company must ensure that:—
 (1)
any estimates of mineral Reserves disclosed are supported, at a minimum, by a
Prefeasibility Study; 11.1.1; 11.2.1
 (2) estimates of mineral Reser ves and mineral Resources are disclosed separately; 10; 11
 (3) Indicated Resources and Measured Resources are only includ ed in economic 11, 12.1.3, 12.2.7
  analyses if the basis on which  they are considered to be economically extractable 18.1
  is explained and they are appropriately discounted for the pr obabilities of their
  conversion to mineral Reserve s. All assumptions must be clearly disclosed.
  Valuations for Inferred Resources are not permitted;
 (4) for commodity prices used in Pre-feasibility Studies, Feas ibility Studies and 18.1.3
  valuations of Indicated Resources, Measured Resources and Res erves:—
  (a) the methods to determine those commodity prices, all mate rial assumptions 18.1.3
   and the basis on which those prices represent reasonable views of future
   prices are explained clearly; and
  (b)  if a contract for future prices of mineral Reserves exis ts, the contract price is 15
   used; and
 (5) for forecast valuations of R eserves and profit forecasts, sensitivity analyses to higher Not applicable. [9]
  and lower prices are supplied . All assumptions must be clearly disclosed.
18.31-18.33 Petroleum reporting standard Not applicable. [8]
18.31 In addition to satisfying  the requirements of Chapter 13 (as modified by this Chapter), a
 Mineral Company exploring for and/or extracting Petroleum Resources and Reserves must
 also satisfy rules 18.32 and 18.33.
18.32 A Mineral Company must di sclose information on Petroleum Resources and Reserves
 either:—
 (1) under PRMS as modified by this Chapter; o r
 (2) under other codes acceptable to the Exchange if it is sati sfied that they give a
  comparable standard of discl osure and sufficient assessment of the underlying
  assets.

Not
e:  A Reporting Standard applied to specif ic assets must be used consistently.
18.33 A Mineral Company must ensure that:—
 (1) where estimates of Reserves are disclosed, the method and reason for choice of
  estimation are disclosed (i.e . deterministic or probabilistic methods, as defined in
  PRMS). Where the probabilistic method is used, the underlying confidence levels
– IIIC-310 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1836 ---
Chapter 18 Sections in SRK’s Report
  applied must be stated;
 (2) if the NPVs attributable to P roved Reserves and Proved plus Probable Reserves are
  disclosed, they are presented on a post-tax basis at varying discount rates (including
  a reflection of the weighted av erage cost of capital or minimum acceptable rate of
  return that applies to the entity at the time of evaluation) or a fixed discount rate of
  10%;
 (3) Proved Reserves and Proved plus Probable Reserves are anal ysed separately and
  principal assumptions (includi ng prices, costs, exchange rates and effective date) and
  the basis of the methodology  are clearly stated;
 (4) if the NPVs attributable to  Reserves are disclosed, they are presented using a
  forecast price as a base case or using a constant price as a base case. The bases
  for the forecast case must be disclosed. The constant price is defined as the
  unweighted arithmetic average of the closing price on the first day of each month
  within the 12 months before the end of the reporting period, unless prices are
  defined by contractual arrangemen ts. The basis on which the forecast price is
  considered reasonable must be disclosed and Mineral Companies must comply with
  rule 18.30;

Note
:  In the forecast case under PRMS , the economic evaluation underlying the
   investment decision is based on the entity’s reasonable forecast of future
   conditions, including costs and prices, which will exist during the life of the
   project.
 (5) if estimated volumes of Contingent Resources or Prospectiv e Resources are
  disclosed, relevant risk fa ctors are clearly stated;

Note
: Under PRMS, wherever the volume of a Contingent Resource is stated,
   risk is expressed as the chance that the accumulation will be commercially
   developed and graduate to the reserves class. Wherever the volume of a
   Prospective Resource is stated, risk is expressed as the chance that a potential
   accumulation will result in a significant discovery of Petroleum.
 (6) economic values are not att ached to Possible Reserves, Contingent Resources or
  Prospective Resources; and
 (7) where an estimate of future net revenue is disclosed, whether calculated without
  discount or using a discount rate, it is prominently disclose d that the estimated
  values disclosed do not rep resent fair market value.
18.34 Mineral or Petroleum Asset Valuation Reports Not applicable. [8, 9]
18.34 A Mineral Company must ensure that:—
 (1) any valuation of its Miner al or Petroleum Assets is prepared under the VALMIN
  Code, SAMVAL Code, CIMVAL or such other code approved by the Exchange from
  time to time;
 (2) the Competent Evaluator s tates clearly the basis of valuation, relevant assumptions
  and the reason why a particula r method of valuation is considered most appropriate,
  having regard to the nature of the valuation and the developm ent status of the
  Mineral or Petroleum Asset;
 (3) if more than one valuation method is used and different va luations result, the
  Competent Evaluator comments on how the valuations compare an d on the reason
  for selecting the value adopted; and
 (4) in preparing any valuation a Competent Evaluator meets the requirements set out in
  rule 18.23.
Notes:
1 It’s not the work scope of SRK.
Operating cost is breakdown according to cost centre, instead of cost element.
Without considering current assets and current liabilities, SRK  made the assumption that the working capital has been incorpor ated into the
sustaining capital.
The simple economic analysis shown in “18 Economic Analysis” provides an indication that the Wassa Mine is economically viable.
It is reasonable to expect that t he operation of the Project will be extended with further exploration and feasibility studies , the mine closure fees,
and the residual value of the project will not be considered in the economic projection.
Wassa Mine is a producing project.
Upon listing, Chifeng Gold/GSWL will comply with the relevant requirements under the Listing Rules.
– IIIC-311 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1837 ---
Mineral Resources and Ore Reserves of GSWL are Au minerals.
The report prepared by SRK is not an Evaluation Report.

– IIIC-312 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1838 ---
Appendix D Chapter 2.6 of the Guide for New Listing
Applicants
– IIIC-313 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1839 ---
Chapter 2.6 Section in SRK’s Report
(i)
The cut-off grade (which should be an industry standard commonly used),
minimum mining width, economic parameters (e.g. waste to ore ratio, stope
productivity), specific gravity derivation, prevailing commodity price
assumptions;
Section 10.11
(ii)
If the Competent Person has a different view on certain assumptions (e.g.
processing recovery rate) made by the applicant, both views should be
disclosed in the listing document, with differences highlighted and underlying
reasons for the different views, and the impact on the applicant if the more
conservative view is adopted;
Not applicable.
(iii)
Detailed analysis for harmful elements identified at mines (e.g. mercury or
arsenic at lead and zinc mines) to give a better picture of whether there are
material concentrations of these elements within particular lodes, and the
impact on the saleability of the minerals;
Not applicable.
(iv) Clear and meaningful drawings and diagrams, shown to scale, of the location
of the applicant’s principal Mineral or Petroleum Assets;
Section 3
(v)
The procedures, amount of testing, assessment and time required to ascertain
the amount of Reserves, and the existing Reserves of the mine over its entire
mine life, expected average Resource and Reserve grades of ore that can be
extracted in future years (preferably covering the whole economic life of the
mine), depletion charges and hedging activities;
Section 11 and Section 12
(vi)
Whether the historical or expected improved recovery rate is used for
estimating the net present value (“NPV”), and the basis on which the discount
rates are considered appropriate;
Section 18.2
(vii)
If the Competent Person did not conduct a site visit, the applicant should
disclose in the “Business” section of the listing document the basis on which
the Reserves/Resources, cost forecasts and other data relating to the mines/
oilfields as disclosed in the CPR are arrived at, how the lack of a site visit
would affect the reliability of the information, and an appropriate risk factor 3;
and
Section 1.5
(viii) All material risks mentioned in the CPR should be disclosed in the “Risk
Factors” section of the listing document.
Section 19


– IIIC-314 –
APPENDIX IIIC COMPETENT PERSON ’S REPORT
FOR THE WASSA GOLD MINE


--- page 1840 ---
Cover Page
Final
Competent Person’s Report for Sepon Rare
Earth Element and Mengkham Rare Earth
Element Projects in Lao People's
Democratic Republic
 The Lao People’s Democratic Republic

Chifeng Jilong Gold Mining Co., Ltd.

SRK Consulting China Ltd.  SCN849D  28 February 2025

– IIID-1 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1841 ---
Final

Competent Person’s Report for Sepon Rare Earth Element and Mengkham
Rare Earth Element Projects in Lao People's Democratic Republic
The Lao People’s Democratic Republic

Prepared for:
Chifeng Jilong Gold Mining Co., Ltd.
No. 7 Xiaojingjia, Wanfeng Road
Fengtai District,  Beijing , 10000
People's Republic of China

010-53232323
www.cfgold.com



Prepared by:
SRK Consulting China Ltd.
B1301 COFCO Plaza, No. 8 Jianguomen Inner Street
Dongcheng District, Beijing, China
100005

+86 10 6511 1000
www.srk.com




Lead Author:  Anshun Xu (Corporate Consultant) Initials: AX

Reviewer:  Yonglian Sun (Corporate Consultant) Initials: YS



Cover Image(s):
No. 1 Wet Smelter Plant of Mengkham REE Project

Copyright © 2025
SRK Consulting China Ltd.    SCN849D    28 February 2025


Inside Cover Page
– IIID-2 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1842 ---
Acknowledgments
SRK would like to acknowledge the support and collaboration pro vided by Sepon and Mengkham
personnel for this assignment. Their collaboration was greatly appreciated and was instrumental to the
success of this project.



The opinions expressed in this Report have been based on the in formation supplied to SRK Consulting China Ltd. (SRK) by
Chifeng Jilong Gold Mining Co., Ltd.(the “Client”).  The opinions in this Report are provided in response to a specific request from
the Client to do so.  SRK has exercised all due care in reviewing the supplied information.  Whilst SRK has compared key supplied
data with expected values, the accuracy of the results and conc lusions from the review are entirely reliant on the accuracy an d
completeness of the supplied dat a.  SRK does not accept respons ibility for any errors or omissions in the supplied information
and does not accept any consequen tial liability arising from co mmercial decisions or actions resulting from them.  Opinions
presented in this report apply to the site conditions and featu res as they existed at the time of SRK’s investigations, and th ose
reasonably foreseeable.  These opinions do not necessarily apply to conditions and features that may arise after the date of this
Report, about which SRK has no prior knowledge nor has the opportunity to evaluate.
– IIID-3 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1843 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Contents    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS iv
Contents
Useful Definitions ................................................................................................................................. xi
Executive Summary ............................................................................................................................ xiii
1 Introduction ................................................................................................................................. 1
2 Program Objectives and Work Program ..................................................................................... 2
2.1 Purpose of the Report ................................................................................................................. 2
2.2 Scope of work and Reporting Standard ...................................................................................... 2
2.2.1 Scope of Work ............................................................................................................. 2
2.2.2 Basis of Technical Report ........................................................................................... 2
2.2.3 Site Visit ....................................................................................................................... 3
2.2.4 Reporting Standard ..................................................................................................... 3
2.3 Limitations Statement ................................................................................................................. 3
2.4 Effective Date .............................................................................................................................. 4
2.5 Work Program ............................................................................................................................. 4
2.6 SRK Experience .......................................................................................................................... 5
2.7 SRK Project Team ...................................................................................................................... 6
2.8 Warranties ................................................................................................................................... 9
2.9 Compliance Statement ............................................................................................................... 9
2.10 Independence Statement ............................................................................................................ 9
2.11 Consent ..................................................................................................................................... 10
2.12 Forward Looking Statement ...................................................................................................... 10
3 Operational Licenses and Permits ............................................................................................ 11
3.1 Sepon REE Project ................................................................................................................... 11
3.2 Mengkham REE Project ........................................................................................................... 11
3.2.1 Trial Mining License................................................................................................... 11
3.2.2 Exploration Permit ..................................................................................................... 12
3.2.3 Other Key Operational Licenses and Permits ........................................................... 12
4 Accessibility, Climate, Local Resources, Infrastructure and Physiography .............................. 13
4.1 Sepon Rare Earth Element Deposit .......................................................................................... 14
4.1.1 Accessibility ............................................................................................................... 14
4.1.2 Local Resources and Infrastructure .......................................................................... 14
4.1.3 Climate and Physiography ........................................................................................ 15
4.1.4 Physiography ............................................................................................................. 15
4.2 Mengkham REE Project ........................................................................................................... 15
4.2.1 Accessibility ............................................................................................................... 15
4.2.2 Local Resources and Infrastructure .......................................................................... 16
4.2.3 Climate ...................................................................................................................... 1 7
4.2.4 Physiography ............................................................................................................. 18
5 History ....................................................................................................................................... 19
5.1 Sepon Rare Earth Element Deposit .......................................................................................... 19
5.2 Mengkham Rare Earth Project ................................................................................................. 19
6 Geological Setting and Mineralization ...................................................................................... 21
– IIID-4 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1844 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Contents    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS v
6.1 Regional Geology ..................................................................................................................... 21
6.2 Property Geology ...................................................................................................................... 22
6.2.1 Sepon Rare Earth Element Deposit Property Geology ............................................. 22
6.2.2 Mengkham Rare Earth Project .................................................................................. 23
6.3 Mineralization ............................................................................................................................ 25
6.3.1 Sepon Rare Earth Element Deposit Property Geology ............................................. 25
6.3.2 Mengkham REE Project ............................................................................................ 27
6.4 Deposit Types ........................................................................................................................... 29
7 Exploration, Sampling and Assaying ........................................................................................ 31
7.1 Exploration Programs ............................................................................................................... 31
7.1.1 Sepon Rare Earth Element Deposit .......................................................................... 31
7.1.2 Mengkham Rare Earth Element Project .................................................................... 31
7.1.3 SRK Comments ......................................................................................................... 32
7.2 Drilling Programs ...................................................................................................................... 32
7.3 Sample Preparation, Analyses and Security ............................................................................ 34
7.3.1 Sepon Rare Earth Element Deposit .......................................................................... 34
7.3.2 Mengkham REE Project ............................................................................................ 36
8 Data Verification ........................................................................................................................ 40
8.1 Sepon Rare Earth Element Deposit .......................................................................................... 40
8.1.1 Verifications by the Client .......................................................................................... 40
8.1.2 SRK Comments ......................................................................................................... 43
8.2 Mengkham REE Project ........................................................................................................... 43
8.2.1 Verifications by the Client .......................................................................................... 43
8.2.2 Verifications by SRK .................................................................................................. 44
8.2.3 SRK Comments ......................................................................................................... 45
9 Mineral Processing and Metallurgical Testing .......................................................................... 46
9.1 Ore Properties ........................................................................................................................... 46
9.2 Metallurgical Test ...................................................................................................................... 46
10 Mineral Resource Estimates ..................................................................................................... 47
10.1 Sepon Rare Earth Element Deposit .......................................................................................... 47
10.1.1 Introduction ................................................................................................................ 47
10.1.2 Resource Estimation Procedures .............................................................................. 47
10.1.3 Resource Database ................................................................................................... 48
10.1.4 Solid Body Modelling ................................................................................................. 48
10.1.5 Bulk Density Test ....................................................................................................... 49
10.1.6 Compositing ............................................................................................................... 49
10.1.7 Evaluation of Outliers ................................................................................................ 50
10.1.8 Block Model and Grade Estimation ........................................................................... 57
10.1.9 Model Validation and Sensitivity ................................................................................ 58
10.1.10 Mineral Resource Classification ................................................................................ 60
10.1.11 Mineral Resource Statement ..................................................................................... 60
10.1.12 Grade Sensitivity Analysis ......................................................................................... 61
10.2 Mengkham REE Project ........................................................................................................... 62
10.2.1 Introduction ................................................................................................................ 62
10.2.2 Resource Estimation Procedures .............................................................................. 63
10.2.3 Resource Database ................................................................................................... 63
– IIID-5 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1845 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Contents    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS vi
10.2.4 Solid Body Modelling ................................................................................................. 64
10.2.5 Bulk Density Test ....................................................................................................... 66
10.2.6 Compositing ............................................................................................................... 66
10.2.7 Evaluation of Outliers ................................................................................................ 67
10.2.8 Block Model and Grade Estimation ........................................................................... 68
10.2.9 Model Validation and Sensitivity ................................................................................ 69
10.2.10 Mineral Resource Classification ................................................................................ 70
10.2.11 Mineral Resource Statement ..................................................................................... 70
10.2.12 Grade Sensitivity Analysis ......................................................................................... 72
10.3 SRK Comments ........................................................................................................................ 73
11 Ore Reserve Estimates ............................................................................................................. 74
11.1 Introduction ............................................................................................................................... 74
11.2 Leaching Test of Mengkham REE Project ................................................................................ 75
11.2.1 In-situ Leaching Mine Design .................................................................................... 76
11.2.2 Modified Mineral Resources ...................................................................................... 76
12 In-situ Leaching Mining ............................................................................................................. 77
12.1 Introduction ............................................................................................................................... 77
12.2 Leaching Conditions ................................................................................................................. 78
12.2.1 Topographic Condition .............................................................................................. 78
12.2.2 Occurrence and Lithology of the Mineralized Body ................................................... 79
12.2.3 Geotechnical and Hydrogeological Conditions ......................................................... 80
12.3 Leaching System ...................................................................................................................... 82
12.3.1 The Injection System ................................................................................................. 82
12.3.2 PLS Collection System .............................................................................................. 84
12.3.3 Recycled Solution System ......................................................................................... 86
12.4 Leaching Unit Identification ....................................................................................................... 86
12.5 Construction and Production Plan ............................................................................................ 88
12.5.1 Production Schedule ................................................................................................. 88
12.6 Conclusions and Recommendations ........................................................................................ 89
13 Recovery Methods .................................................................................................................... 90
13.1 Overview ................................................................................................................................... 90
13.2 Hydrometallurgical Process ...................................................................................................... 90
13.3 Production Capacity and Technical Parameters ...................................................................... 92
13.4 Main Equipment & Facilities & Plant Layout ............................................................................. 92
13.5 Conclusions and Recommendations ........................................................................................ 94
14 Project Infrastructure................................................................................................................. 95
14.1 Industrial Sites .......................................................................................................................... 95
14.2 Internal and External Transportation ........................................................................................ 95
14.3 Water Supply and Drainage ...................................................................................................... 95
14.4 Power Supply ............................................................................................................................ 96
14.5 Other Supportive Facilities ........................................................................................................ 96
15 Market Studies and Contracts .................................................................................................. 97
16 Environmental, Social and Community Impact for Mengkham REE Project ............................ 98
16.1 Environmental and Social Review Objectives .......................................................................... 98
– IIID-6 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1846 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Contents    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS vii
16.2 Environmental and Social Review ............................................................................................ 98
16.3 Evaluation of Environmental and Social Risks ......................................................................... 99
17 Capital Expenditures and Operating Expenses ...................................................................... 101
17.1 Summary ................................................................................................................................. 101
17.2 Capital Expenditures ............................................................................................................... 101
17.3 Operating Expenses ............................................................................................................... 102
18 Preliminary Economic Analysis for Mengkham REE Project .................................................. 104
18.1 Principal Assumptions............................................................................................................. 104
18.2 REO Price ............................................................................................................................... 105
18.3 Depreciation, Amortization and Taxes .................................................................................... 106
18.4 Net Present Value Result ....................................................................................................... 106
18.5 Sensitivity Analysis ................................................................................................................. 106
19 Risk Analysis ........................................................................................................................... 108
20 Interpretation and Conclusions ............................................................................................... 110
20.1 Sepon Rare Earth Element Deposit ........................................................................................ 110
20.1.1 Geology and Exploration ......................................................................................... 110
20.1.2 Mineral Resource Estimation .................................................................................. 110
20.2 Mengkham REE Project ......................................................................................................... 110
20.2.1 Geology and Exploration ......................................................................................... 110
20.2.2 Mineral Resource Estimation .................................................................................. 111
20.2.3 Metallurgical Testing and Recovery Methods ......................................................... 111
21 Recommendations .................................................................................................................. 112
21.1 Sepon REE Project ................................................................................................................. 112
21.1.1 Mineral Resources Estimation ................................................................................. 112
21.2 Mengkham REE Project ......................................................................................................... 112
21.2.1 Mineral Resources Estimation ................................................................................. 112
21.2.2 Metallurgical Testing and Recovery Methods ......................................................... 112
22 References .............................................................................................................................. 113

– IIID-7 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1847 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Contents    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS viii
Tables
Table 2-1: SRK’s Reports for Listing on the HKEx ...................................................................... 5
Table 2-2: SRK Project Team ...................................................................................................... 7
Table 3-1: Inflection Points of Sepon Exploration Permit .......................................................... 11
Table 3-2: Trial Mining License .................................................................................................. 12
Table 3-3: Exploration Permit .................................................................................................... 12
Table 6-1: Typical Content and Composition of the TREO for Sepon Project .......................... 26
Table 6-2: Typical Content and Composition of the SREO for Mengkham REE Project .......... 28
Table 7-1: Programs Completed in Sepon Project .................................................................... 31
Table 7-2: Programs Completed in Mengkham REE Project .................................................... 32
Table 8-1: QAQC Sample Summary for Sepon Project ............................................................ 40
Table 8-2: CRM Summary for Sepon Project ............................................................................ 40
Table 8-3: Field Duplicates Summary for Sepon Project ........................................................... 41
Table 8-4: QAQC Sample Summary for Mengkham REE Project............................................. 43
Table 8-5: Summary of SRK Verification Borehole Samples .................................................... 44
Table 8-6: SRK Verification Samples Summary for Mengkham Project ................................... 45
Table 10-1: Drillhole Statistics used for the Resource Estimation ............................................... 48
Table 10-2: Outlier Value for Sepon Project ................................................................................ 57
Table 10-3: Block Model Parameters .......................................................................................... 57
Table 10-4: Search Ellipsoid Parameters .................................................................................... 58
Table 10-5: Mineral Resource Statement1 of Sepon REE Project, as of 30 September 2024 .... 61
Table 10-6: Drillhole Statistics used for the Resource Estimation ............................................... 64
Table 10-7: Raw and Composite Sample Statistics within Mineralized Domain ......................... 67
Table 10-8: Outlier Value for Mengkham REE Project ................................................................ 68
Table 10-9: Block Model Parameters .......................................................................................... 68
Table 10-10: Search Ellipsoid Parameters .................................................................................... 68
Table 10-11: Simplified Cost Model used for RPEEE Assessment ............................................... 71
Table 10-12: Mineral Resource Statement1 of Mangkham REE Project, as of 30 September 2024
 .................................................................................................................................. 71
Table 11-1: Modified Mineral Resources of the CHIXIA Project, as of 30 September 2024 ....... 76
Table 12-1: In-situ Leaching Mining Design Parameters, as of 30 September 2024 .................. 77
Table 12-2: Mining Schedule of the CHIXIA Project .................................................................... 88
Table 13-1: Main Technical Parameters of the Hydrometallurgical Plant ................................... 92
Table 13-2: Main Equipment of the Existing Hydrometallurgical Plant ........................................ 92
Table 13-3: Main Facilities of the Hydrometallurgical Plant ......................................................... 93
Table 14-1: Proposed Land Area needed for the industrial sites proposed in the PFS .............. 95
Table 17-1: The Capex Breakdown for the Mengkham REE Project (Unit: RMB M) ................ 101
Table 17-2: Historical Investment Breakdown (Unit: RMB M) ................................................... 102
Table 17-3:  Future Investment Schedule (Unit: RMB M) ........................................................... 102
Table 17-4: Forecasted Opex of the Mengkham RE Project ..................................................... 103
Table 18-1: Principal Assumptions for the DCF Model of the Project ....................................... 104
Table 18-2: Estimated NPVs at Different Discount Rate (Unit: RMB M) ................................... 106
Table 18-3: Sensitivity Coefficient of NPV (at 10% Discount Rate, in RMB M) .......................... 106
Table 19-1: Project Risk Assessment of the Mengkham REE Project ....................................... 109

Figures
Figure 4-1: Locations of The Sepon and Mengkham REE Projects ............................................. 13
Figure 4-2: Location of Sepon REE Project ................................................................................ 14
– IIID-8 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1848 ---
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Contents    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS ix
Figure 4-3: Location of Mengkham REE Project ........................................................................ 16
Figure 6-1: Regional Geology Setting ......................................................................................... 21
Figure 6-2: Local Geological Map of the Sepon Project ............................................................. 23
Figure 6-3: Local Geological Map of the Mengkham REE Project ............................................. 24
Figure 6-4: Section Map of Sepon Project (633610E) ................................................................ 26
Figure 6-5: TREO Composition of Sepon Project ....................................................................... 26
Figure 6-6: SREO Composition of Mengkham REE Project ....................................................... 28
Figure 6-7: Typical IAC-REEs Bearing Profile ............................................................................ 30
Figure 7-1: Borehole Distribution of Sepon Project .................................................................... 32
Figure 7-2: Borehole Distribution of the Mengkham REE Project............................................... 33
Figure 7-3: The GN Auger Utilization and Hole Sealing ............................................................. 34
Figure 7-4: The Quick REE Mineralization Distinguish on Mengkham Drilling Site .................... 36
Figure 7-5: The Drying Oven on Mengkham Mine Site .............................................................. 37
Figure 7-6: The Mine Laboratory ................................................................................................ 38
Figure 8-1: Coarse Blanks for Sepon Project ............................................................................. 40
Figure 8-2: Pulp Blanks for Sepon Project .................................................................................. 41
Figure 8-3: Field Duplicates for Sepon Project ........................................................................... 42
Figure 8-4: Duplicates of Mengkham REE Project ..................................................................... 44
Figure 8-5: SRK Verification Duplicates of Mengkham REE Project .......................................... 45
Figure 9-1: Laboratory Leaching Test ........................................................................................... 46
Figure 10-1: Plan View (Up) and Section View (Down) of Sepon Mineralized Bodies ................. 49
Figure 10-2: Histogram of Sample Length .................................................................................... 50
Figure 10-3: Y2O3 Histogram and Cumulative Histogram of the Mineralized Domain .................. 50
Figure 10-4:  La2O3 Histogram and Cumulative Histogram of the Mineralized Domain ............... 51
Figure 10-5: CeO2 Histogram and Cumulative Histogram of the Mineralized Domain ................. 51
Figure 10-6: Pr6O11 Histogram and Cumulative Histogram of the Mineralized Domain ............... 52
Figure 10-7: Nd2O3 Histogram and Cumulative Histogram of the Mineralized Domain................ 52
Figure 10-8: Sm2O3 Histogram and Cumulative Histogram of the Mineralized Domain ............... 53
Figure 10-9: Gd2O3 Histogram and Cumulative Histogram of the Mineralized Domain ............... 53
Figure 10-10: Tb4O7 Histogram and Cumulative Histogram of the Mineralized Domain .............. 54
Figure 10-11: Dy2O3 Histogram and Cumulative Histogram of the Mineralized Domain .............. 54
Figure 10-12: Ho2O3 Histogram and Cumulative Histogram of the Mineralized Domain.............. 55
Figure 10-13: Er2O3 Histogram and Cumulative Histogram of the Mineralized Domain............... 55
Figure 10-14: Tm2O3 Histogram and Cumulative Histogram of the Mineralized Domain ............. 56
Figure 10-15: Yb2O3 Histogram and Cumulative Histogram of the Mineralized Domain .............. 56
Figure 10-16: Lu2O3 Histogram and Cumulative Histogram of the Mineralized Domain .............. 57
Figure 10-17: Pr6O11 Grade Swath Plot for Sepon Project ........................................................... 58
Figure 10-18: Nd2O3 Grade Swath Plot for Sepon Project ........................................................... 59
Figure 10-19: Sepon Project Mineral Resource Classification ..................................................... 60
Figure 10-20: Sepon Project Grade Tonnage Curve .................................................................... 62
Figure 10-21: Topo Survey Area of Mengkham REE Projects ..................................................... 64
Figure 10-22: Plan View (Up) and Section View (Down) of Mengkham Mineralized Bodies ....... 65
Figure 10-23: Histogram of Sample Length .................................................................................. 66
Figure 10-24: SREO Grade Before and After Compositing .......................................................... 67
Figure 10-25: Histogram and Cumulative Histogram of the Mineralized Domain ......................... 68
Figure 10-26: SREO Grade Swath Plot for Mengkham REE Project ........................................... 69
Figure 10-27: Mengkham REE Project Grade Tonnage Curve .................................................... 72
Figure 11-1: Relationship Between Mineral Resources and Ore Reserve ................................... 74
Figure 11-2: In-Situ Injection System at The Mountaintop ............................................................ 76
Figure 12-1: Schematic Cross-section View of In-situ Leaching Mining ....................................... 78
– IIID-9 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Contents    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS x
Figure 12-2: General Topographic Elevations within Exploration License ................................... 79
Figure 12-3: Schematic Diagram of Leaching Injection Intensity Experiment .............................. 81
Figure 12-4: Local Surface Water Condition ................................................................................. 82
Figure 12-5: Leaching Solution Pond ............................................................................................ 83
Figure 12-6: Auger and Injection Hole .......................................................................................... 84
Figure 12-7: Main PLS Collection Tunnel in Construction ............................................................ 85
Figure 12-8: PLS Hub Ponds ........................................................................................................ 86
Figure 12-9: In-situ Leaching Unit Identification............................................................................ 87
Figure 12-10: Construction and Production Chart ........................................................................ 88
Figure 13-1: Processing Flowsheet of Hydrometallurgical Plant .................................................. 91
Figure 13-2: General View of the Hydrometallurgical Plant in Construction ................................. 94
Figure 18-1: Mixed REO Price Trend in History.......................................................................... 105
Figure 18-2: Sensitivity Analysis on NPV .................................................................................... 107

Appendices
Appendix A Trial Mining License
Appendix B Table 1 (JORC)
Appendix C Compliance with 18 Chapter
Appendix D Chapter 2.6 of the Guide for New Listing Applicants






– IIID-10 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1850 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Useful Definitions    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xi
Useful Definitions
This list contains definitions of symbols, units, abbreviations, and terminology that may be unfamiliar to the
reader.
% Percent
’ Minute
° Degrees
ASL above sea level
C Carboniferous System; Chemical symbol for element carbon
℃ Degree(s) Centigrade Celsius, a unit of temperature
Ce Chemical symbol for the rare earth element cerium
cm centimeter
CPR Competent Person’s Report
CREO critical rare earth oxides, the sum of Nd2O3 + Eu2O3 + Tb4O7 + Dy2O3 + Y2O3
CRMs Certified reference materials.
DTM Digital Terrain Models
Dy Chemical symbol for the rare earth element dysprosium
E East
EDTA Ethylene Diamine Tetraacetic Acid
Er Chemical symbol for the rare earth element erbium
Eu Chemical symbol for the rare earth element europium
g/t gram per tonne
Gd Chemical symbol for the rare earth element gadolinium
GPS Global Positioning System
Ho Chemical symbol for the rare earth element holmium
JORC The Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves, edition
2012
IAC Ion Adsorption Clay
IDW Inverse Distance Weighting
Indicated Mineral
Resource
that part of a resource for which tonnage, densities, shape, ph ysical characteristics, grade and mineral
content can be estimated with a reasonable level of confidence.  It is based on exploration, sampling and
testing information gathered through appropriate techniques fro m 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
Inferred Mineral
Resource
that part of a resource for which tonnage, grade and mineral content can be estimated with a low level of
confidence. It is inferred from geological evidence and assumed  but not verified geological and/or grade
continuity. It is based on info rmation gathered through appropr iate techniques from locations such as
outcrops, trenches, pits, workings, and drill holes which may be limited or of uncertain quality and reliability
kg kilogram
km kilometer
km2 square kilometer
kt kiloton
KV Kilovolts, equivalent to 1,000 volts
La Chemical symbol for the rare earth element lanthanum
LXML Lane Xang Minerals Limited Company
– IIID-11 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Useful Definitions    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xii
% Percent
Lu Chemical symbol for the rare earth element lutetium
m meter
MREO magnet rare earth oxides, the sum of Pr6O11+Nd2O3+Tb4O7+Dy2O3
Mt million tonnes
N North
Nd Chemical symbol for the rare earth element neodymium
P Permian System
Pr Chemical symbol for the rare earth element praseodymium
QA/QC quality assurance and quality control
REE Rare Earth Elements, consists of a set of seventeen chemica l elements in the periodic table, specifically
the fifteen lanthanides (from element number 57 to 71), as well as scandium and yttrium
RPEEE Reasonable Prospects for Eventual Economic Extraction
Sm Chemical symbol for the rare earth element samarium
SREO Soluble rare earth oxides, only including rare earth elements in the form of ionic adsorption of the deposit.
t/m3 Tonne per cubic metre
T2 Middle Triassic Series
T3 Upper Triassic Series
Tb Chemical symbol for the rare earth element terbium
Tm Chemical symbol for the rare earth element thulium
TREO The total rare earth oxides equivalent, the sum of La 2O3, CeO2, Pr6O11, Nd2O3, Sm2O3, Eu2O3, Gd2O3,
Tb4O7, Dy2O3, Ho2O3, Er2O3, Tm2O3, Yb2O3, Lu2O3, Y2O3, including rare earth elements present in the
crystal lattice as well as those in the form of ionic adsorption of the deposit
UTM Universal Transverse Mercator Projection
Xiamen Tungsten Xiamen TUNGSTEN CO.,LTD
Y Chemical symbol for the rare earth element yttrium
Yb Chemical symbol for the rare earth element ytterbium
Z Elevation




– IIID-12 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xiii
Executive Summary
SRK Consulting China Ltd.(“SRK”) was requested by Chifeng Jilong Gold Mining Co., Ltd. (“Chifeng
Gold” or the “Client”) to prepare a Competent Person’s Report (“CPR” or the “Report”) for its Sepon
Rare Earth Element (“REE”) Project and Mengkham Rare Earth Element Project (the “the Projects”)
located in Savannakhet Province and Xieng Khouang Province, Lao  People’s Democratic Republic
(“Laos”) in accordance with the guidelines of the Australasian Code for Reporting Exploration
Results, Mineral Resources and Ore Reserves, 2012 edition (“ JORC Code (2012)”) and the Rules
Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “HKEx”).  The
projects include exploration licenses, mining licenses, as well as the in-situ leaching mining facilities,
and associated ore processing and metallurgic plants in construction and metallurgical leach testing.
The Sepon REE project is currently operated by Lane Xang Minera ls Limited Company (“ LXML”),
which is a subsidiary of Chifeng Gold.  The Mengkham REE project has a trial mining permit and an
exploration permit, which are held by China Investment Rare Ear th Mining Co., Ltd. and China
Investment Rare Earth Mining XiangKhouang Co., Ltd., respectively. China Investment Mining (Laos)
Sole Co., Ltd. holds an 86% equity interest in both China Investment Rare Earth Mining Co., Ltd. and
China Investment Rare Earth Mining XiangKhouang Co., Ltd. Since  March 2024, Chixia Laos
Holdings Limited ("Chixia Laos") has been in the process of acquiring a 90% equity interest in China
Investment Mining (Laos) Sole Co., Ltd.
This report consists of an independent review of the geology, e xploration, Mineral Resources, Ore
Reserves, mining, mineral processing and smelter-refinery, capi tal investment, operating cost, and
environmental and social aspects of the Projects.
Outline of Work Programs
The scope of work, as defined in letters of engagement reached in November 2022, and May 2024
between Chifeng Gold and SRK, includes reviewing and estimating  of the mineral resource of the
REE mineralisation delineated within the Sepon Project’s tenements and the Mengkham REE project,
and reviewing a preliminary feasibility study on the Mengkham REE project, and preparation of a
CPR on the projects in accordance with JORC (2012) and the listing requirements of the HKEx.
SRK has conducted the work programs on the projects in phases:
Phase 1: SRK conducted a desktop review on documents provided by the cl ient before conducting
site visits to the project site.
Phase 2: SRK conducted site visits to both projects. During the period from 9 December 2022 to 14
December 2022, SRK’s personnel conducted site visits to the Sep on Project, to gather data and
interview related personnel who conducted exploration and feasibility study on the project.  During
the period from 13 to 16 May 2024, SRK further conducted a site  visit to the Sepon REE Project.
During the period from 9 to 11 May 2024, SRK conducted site visits to the Mengkham REE project,
inspected and observed the status of the project, held meetings with the managements and technical
personnel, sighted geology, explo ration, mineralization, as well as the mining facilities, ore
processing and metallurgic facilities in construction and metal lurgical leach testing, also conducted
its own data verification programs, and carried out review in environmental and social aspects.
Phase 3: SRK team reviewed the information provided by Chifeng Gold, a nd estimated Mineral
Resources and reviewed the preliminary feasibility study on the Mengkham REE project, conducted
– IIID-13 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xiv
a preliminary economic assessment on the project, and compiled a technical report about the
projects and reported the Exploration Results, Mineral Resources and Ore Reserves according to
the JORC Code 2012, and submitted it to the client for comments in August and November 2024.
SRK will further revise the report based on feedbacks from the client and related third parties, and
will finalize it in the due course.
Results
Overall
Chifeng Gold owns the Sepon REE Project through its subsidiaries and is acquiring Mengkham REE
Project.  The REE deposits in both projects are ion-adsorption type with the REEs enriched in the
weathered zones over granite rock bodies.
The Sepon REE Project is an exploration and resource project within the exploration permit of LXML.
Exploration programs, including trenching, drilling to take sam ples, and assaying results of the
samples and other related database, can support a mineral resou rce estimate.  SRK has reviewed
the database obtained and re-estimated the Mineral Resources of the project.  As of 30 September
2024, the Sepon REE Project possesses 26.78 million tonnes (“Mt”) of Indicated Mineral Resources
with an average grade of 383.75 grams per tonne (“g/t”) total rare earth oxide equivalent (“TREO”),
and 63.79 Mt of Inferred Mineral Resources averaging 339.22 g/t TREO, at a cut-off grade of 170g/t
TREO.
The Mengkham REE Project is a development production project.  Previous exploration programs
defined the REE mineralized bodies, and the database obtained m ay support a mineral resource
estimate. As of 30 September 2024, SRK estimated that the project has a resource basis of 139.05
Mt Inferred Mineral Resources with an average grade of 241.79 g/t soluble rare earth oxide (“SREO”),
at a cut-off grade of 100 g/t SREO.
SRK reviewed a feasibility study (“FS”) done internally by Chixia Laos for developing the Mengkham
REE Project, and considers that it may match the study level of a preliminary feasibility study (“PFS”).
The PFS proposed that the in-situ leaching mining method would be adopted to develop the project,
with wet smelter facilities to f urther process the leaching sol utions to finally produce REE oxide for
sales to the buyers in China.  The proposed production capacity is 3,675 tonnes (“t”) per annum.
Chixia Laos obtained a trial production license over 8 square k ilometres (“km2”) of the deposit, and
has been constructing the mining and processing facilities for the production.
SRK opines that the current resource basis can support a preliminary economic assessment on the
project.  SRK reviewed the PFS and held discussions with related technical personnel of the project,
using the parameters proposed in the PFS with some modification, and projected that the project is
economically viable.
SRK recommends that a supplemental exploration program should b e conducted to enhance the
resource category, and then a feasibility study should be conducted based on the updated resources.
– IIID-14 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xv
Operational Licences and Permits
LXML owns a copper and gold exploration permit which covering the Sepon REE Project.
SRK sighted a trial mining license for the Mengkham mine site, and land use agreements with the
locals. Other licenses and permits including water use permit or site discharge permit are under the
application.
Geology and Mineralization
Rare earth elements (“REE”) typically refer to the 15 lanthanide elements on the periodic table from
lanthanum (La) to lutetium (Lu) and the transition metals scand ium (Sc) and yttrium (Y) due to the
similarity of the chemical property. From industrial developmen t perspective, scandium is typically
excluded from REE mineral development operations as it's normally not the paragenetic mineral with
the lanthanide rare earth elements. The promethium (Pm) is also  not included in the mineral
development due to its radioactive property.
Ion-adsorption rare earth deposit is formed through weathering and leaching of minerals bearing rare
earth elements from primary rocks, typically in tropical climat es. Rare earth elements leached from
granitic or alkaline igneous rocks were adsorbed onto clay mine rals in soil, sometimes forming
economically viable deposits.
Sepon
The content of total rare earth oxides (“TREO”) gradually decre ases from top to bottom, the upper
part can be enriched into a rare earth ore body, and the end ho le position of a small part of the drill
hole has a higher grade, and it may not be able to penetrate th e weathering layer. The elevation of
the ore body is between 240 and 410 meters ASL, the lowest eros ion base level in this area is 210
meters, and the ore body is above the lowest erosion base level. The depth of the ore body is
generally 0-5 meters. The TREO grade ranges from 310 to 830 g/t, averaging 440 g/t.
Mengkham
The geological layers were summarised as the completely weather ed layer, semi-weathered layer
and the fresh layer, with the completely weathered layer being the main ore-bearing layer. The top
of the mineralised zone is defined by a thin surficial soil zon e that averages 2 m in thickness. The
base of the mineralised zone extend s to an average vertical dep th of 9.0 m. And the SREO grade
range from 9.5 to 2,857 g/t, averaging 243.5 g/t.
Exploration Status
The procedures for sample collection, preparation, and analysis  are following the REE industry
standards. SRK considers that the procedure, as well as the dat a and information obtained, are
acceptable for resource estimation purposes.
Sepon
For Sepon project, LXML Exploration Department conducted an exploration program from November
2021 to July 2022. A total of 607 boreholes (4,441 metres) were  drilled during the exploration on a
200-metre x 100-metre or 100-metre x 100-metre pattern.
– IIID-15 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xvi
Sampling was conducted as well, and the whole drilling core was taken as sample at 1m interval by
using the method of diagonal quarters to reduce the sample, with one half as the sample for assaying,
and the other half as the spare sample for storage. The samples  were all properly numbered,
recorded before sent out to the labs.
All basic assaying samples (TREO) were prepared and assayed in the ALS lab in Australia. The
assaying method is ME-MS81. Qual ity Control and Assurance (“QA/ QC”) procedures were
undertaken on an on-going basis to certify that the assay results from the drilling programme would
be confidently relied upon. These procedures included the inser tion of QA/QC samples comprising
standards or Certified Reference Materials (CRMs), i.e., material containing known quantities of the
element being assayed for; blank s i.e., material that has been prepared known to contain trace
material; and duplicates.
In the general exploration report, 10 specific gravity samples were also taken from drilling cores and
were measured in the lab of the mine. In SRK’s opinion, it was unable to collect density sample from
GN Auger hole cores. A dry bulk density of 1.5 t/m3 was used in resource estimation for Sepon project.
Mengkham
For Mengkham REE Project, Longyan Dadi Mining Development Servi ce Co., Ltd conducted an
exploration program from January 2022 to December 2023. A total  of 13,656 boreholes (198,957
metres) were drilled during the exploration, which were spaced 30-100 m apart.
Before sample collection, a quick test procedure was conducted on-site to identify REE mineralized
intervals. This test dissolved REE ions in clay using ammonium sulphate and oxalic acid to obtain a
precipitate. The samples were collected and prepared according to the Chinese Rare Earth Mineral
Geological Exploration Standard (DZ/T0204-2022). All samples were analysed (SREO) in the mine
lab onsite with the method of Ethylene Diamine Tetraacetic Acid (“EDTA”) volumetric.
A total of 6,017 samples (about 6% of the samples used in Mineral Resource estimation) were
collected as internal lab check samples with a pass rate of 82%. And a total of 3,500 samples (about
4% of the samples used in Mineral Resource estimation) were collected as internal lab check
samples with a pass rate of 92%.
SRK conducted a data verification program and collected 169 cor e duplicate samples from 13
boreholes in Mengkham REE project. The results showed that bias  was observed between original
assay and verification results. S RK has checked with both onsite laboratory and SGS staff, found
that the sample preparation and assaying method were different.  SRK has downgraded Indicated
Mineral Resources to Inferred Mineral Resource.
A total of ten bulk density samples were implemented across the project areas with the natural bulk
density (wet basis) ranging from 1.7 to 1.81 t/m 3, averaging 1.75 t/m 3, dry bulk density ranging
between 1.35 and 1.55 t/m3, averaging 1.47 t/m3.
Mineral Resource Estimates
The resource estimation methodology involved consolidating and verifying borehole and topographic
data. Wireframe models delineated mineralization boundaries bas ed on assay data and lithology.
Resource domains were defined, and sample results were composit ed and capped for statistical
– IIID-16 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xvii
analysis. Block models were interpolated, and resources classif ied and validated to determine
economic prospects and cut-off grades.
Based on the Reasonable Prospects of Eventual Economic Extracti on (“RPEEE”) assessment and
considering the characteristics of the leaching mining method, SRK used a cut-off grade of 170 g/t
TREO for Sepon project to report Mineral Resources and a cut-of f grade of 100 g/t SREO for
Mengkham project, based on a price of 239,000 RMB/t REO.
As of 30 September 2024, by applying a cut-off grade of 170 g/t TREO, the Mineral Resources SRK
estimated and reported are as follows:
 26.78 Mt of Indicated Mineral Resource with an average grade of  383.75 g/t TREO, equivalent
to 10.28 kt of total rare earth oxides within the Project area.
 63.79 Mt Inferred Mineral Resourc e with an average grade of 339 .22 g/t TREO, equivalent to
21.64 kt of total rare earth oxides within the Project area.
Table ES- 1: Mineral Resource Statement 1 of Sepon REE Project, as of 30 September 2024
Category Tonnage
(Mt) TREO (g/t) TREO (kt) PrNd Oxides (%) MREO(%) CREO(%)
Indicated 26.78  383.75 10.28 19.14 21.97 33.87
Inferred 63.79  339.22 21.64 18.78 21.45 32.59
Notes:
1 Mineral Resources are not Ore Reserves and have not demonstrate d economic viability. All figures are rounded to reflect
the relative accuracy of the estimate. All composites have been capped where appropriate.
2 The information in this report which relates to Mineral Resource is based on information co mpiled by Mr. Huaixiang Li and
Dr. Anson Xu who are full time employees of SRK Consulting Chin a. Mr. Huaixiang Li is a Member of AIG and Dr. Anson
Xu is a Fellow of AusIMM. Dr. Xu have sufficient experience whi ch is relevant to the style of mineralisation and the type of
deposits under consideration and to the activity which they are undertaking to qualify as the Competent Persons as defined
by JORC Code (2012).  Mr. Li and Dr. Xu consent to the reporting of this information in the form and context in which it
appears.
3 Mineral Resources are reported at a cut-off grade of 170 g/t TR EO. Cut-off grades are based on a price of 239,000 RMB/t
REO.
4 MREO: Pr6O11+Nd2O3+Tb4O7+Dy2O3.
5 CREO: Nd2O3 + Eu2O3 + Tb4O7 + Dy2O3 + Y2O3, determined by US Department of Energy 2023.
6 TREO: Total Rare Earth Oxides include Y2O3+ La2O3 + CeO2 + Pr6O11 + Nd2O3 + Sm2O3 + Eu2O3 + Gd2O3 + Tb4O7 + Dy2O3
+ Ho2O3 + Er2O3 + Tm2O3 + Yb2O3 + Lu2O3.
The project is in the construction and commissioning phase, and  currently, no REE oxides are
available for sale.
As of 30 September 2024, applying a cut-off grade of 100 g/t SR EO, the Mineral Resources of
Mengkham project are as follows:
 139.05 Mt Inferred Mineral Resour ce with an average grade of 24 1.79 g/t SREO, equivalent to
33.62 kt of soluble rare earth oxides within the Project area.
Table ES- 2: Mineral Resource Statement 1 of Mangkham REE Project, as of 30 September
2024
License Category Dry BD (t/m 3) Tonnage
(Mt) SREO (g/t) SREO (kt)
Trial Mining Inferred 1.47 55.59 267.75 14.88
Exploration Inferred 1.47 83.47 224.51 18.74
Total Inferred 1.47 139.05 241.79 33.62
Notes:
– IIID-17 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1857 ---
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Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xviii
1 Mineral Resources are not Ore Reserves and have not demonstrate d economic viability. All figures are rounded to reflect
the relative accuracy of the estimate. All composites have been capped where appropriate.
2 The information in this report which relates to Mineral Resource is based on information co mpiled by Mr. Huaixiang Li and
Dr. Anson Xu who are full time employees of SRK Consulting China Ltd. Mr. Huaixiang Li is a Member of AIG and Dr. Anson
Xu is a Fellow of AusIMM. Dr. Xu have sufficient experience whi ch is relevant to the style of mineralisation and the type of
deposits under consideration and to the activity which they are undertaking to qualify as the Competent Persons as defined
by JORC Code (2012).  Mr. Li and Dr. Xu consent to the reporting of this information in the form and context in which it
appears.
3 Mineral Resources are reported at a cut-off grade of 100 g/t SR EO. Cut-off grades are based on a price of 239,000 RMB/t
REO.
Ore Reserve Estimates
For Sepon REE Project, the current study indicates that the project would not be financially feasible.
Following discussions with LXML, it has been decided that only Mineral Resources will be reported
in the report.
According to the JORC 2012, only Measured Resources and Indicated Resources can be considered
when estimating Ore Reserves. In this case of Mengkham Ion Rare  Earth Project, based on SRK’s
resource review and re-estimate, all of the Mineral Resources o f the Mengkham REE Project are
categorized as Inferred Mineral  Resources. The mineral resource  basis may only support a
preliminary economic assessment to analyse the project's potential economics.  Therefore, there is
no Orel Reserve for the Mengkham REE Project.
For Mengkham REE Project only
In-situ Leaching Mining
CHIXIA Laos commenced to operate a leaching test in March 2024. The leaching test facilities were
constructed basically according to the design proposed in a pre liminary feasibility study (“ PFS”) to
develop the project.  SRK reviewed the PFS and visited the leaching test facilities. CHIXIA Laos used
in-situ leaching mining to extract REEs from the deposits, The process of the in-situ leaching mining
involves mainly two parts: leaching solution injection and pregnant leach solution (“PLS”) collection.
The injection system introduces a leaching solution into the ore body to dissolve the REEs through
injection holes. The leaching solution enters the ore body via holes and absorbs the REEs.
The collection system consists of a series of tunnels and/or collection holes under the ore body to
gather the PLS, which is then pumped to the plant for further processing via pipes.
The key technical parameters listed in Table ES- 3 below are su mmarized based on the PFS with
SRK’s modification.
Table ES- 3: In-situ Leaching Mi ning Design Parameters, as of 30 September 2024
Design Parameter Unit PFS's Inputs SRK's Inputs
Overall
In-situ Leaching Mining Recovery % 90.0  90.0
Processing Recovery %  85.5   85.5
Overall Recovery % 77.0  77.0
Wet Plant – REO tpa 3675 & 2800   3675 & 2800
PLS Capacity million m3 pa 16.3 &11.6  16.3 &11.6
In-situ Leaching Mining
Average Orebody Depth m 8.7  7.9
– IIID-18 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xix
Design Parameter Unit PFS's Inputs SRK's Inputs
Injection Holes m 4.0 4.0
Injection holes Cover Area m2  5.0   5.0
Collection Tunnel Cover Area m2 3.5 3.5
Source: CHIXIA
Mining Schedule
A mining schedule has been planned in terms of the proposed processing capacity as shown in
Table ES- 4.
Table ES- 4: Mining Schedule of the CHIXIA Project
Section Unit Total 2024 2025 2026 2027 2028 2029 2030 2031
Tonnage kt 138,040  4,620 19,700 18,040 19,590 19, 650  25,020  19,150 12,270
Grade
(SREO) g/t 239.42 221.94 266.10 236.15 237.71 218.51 220.33 263.75 245 .12
Source: SRK
Metallurgical Testing and Recovery Methods
The Mengkham ore belongs to the ion-adsorbed type rare earth ore, with average soluble rare earth
oxide (“SREO”) content of 0.025%. The minerals are mainly quartz, feldspar, biotite, ilmenite, magnetite,
followed by zircon, apatite, xenotime, fluorite, sphene minerals and so on.
A simple laboratory column leaching test had been conducted on the samples from #2 ore body. The
results showed that the permeability coefficient is 0.89x10 -3 ～1.11x10-3cm/s and the pregnant
leaching solution (“PLS”) concentration can reach 2.0 g/L with the SREO leaching rate of about 94%.
The PLS undergoes four steps of processing to yield primary product of rare earth carbonate (“REC”),
which will be sent to the calcination workshop to produce mixed rare earth oxide (“REO”). The residue
generated from the processing will be dissolved by acid to recycle REO, which would improve the
REO processing recovery and the economic benefits.
The full production capacity of the first hydrometallurgical pl ant is 3,675 tpa REO, and SRK deems
that it is appropriate. The designed total recovery was 77%, wi th the ISL rate of 90% and the
hydrometallurgical recovery rate of 85.5%.
After the review of all design data and site visit for the Proj ect, SRK comes to the following
conclusions and recommendations:
 Representative ore samples from each ore body should be taken to carry out test studies before
production, and add the following experimental contents:
i. SREO content analysis of ore samples, and
ii. PLS purification and precipitation tests to determine the purif ication and precipitation
conditions and reagents consumption.
 Three hydrometallurgical plants and one calcination plant are planned to be built during the life
of mine. The Project had completed most of the construction of the Leaching Test Plant until May
2024, except for the filter press workshop and calcination work shop. Additionally, North Plant
– IIID-19 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xx
with production capacity of 3,675 tpa REO and South Plant of 2, 800 tpa REO are scheduled to
be constructed in 2026 and 2028, respectively.
Environmental and Social Aspects
Currently what are identified as part of the project assessment and this SRK review would include:
 Environmental approval to be obtained;
 Water pollution; and
 Mine closure fund to be established.
It is SRK’s opinion that the above environmental risks are categorised as medium risks (i.e., requiring
risk management measures) and they are generally manageable.
Capital Expenditures and Operating Expenses
The estimated Capex primarily encompasses the main production f acilities of three
hydrometallurgical plants, public auxiliary facilities and othe r engineering construction expenses
(mainly associated with the mining rights or licence cost).
The total estimated Capex over the LOM is RMB130.32 million, which includes the historical
investment of RMB66.35 million, t he sustaining investment of RMB 48.80 million and the closure
investment of RMB15.17 million. Table ES- 5 summarized the Capex breakdown for the Project.
Table ES- 5: The Capex Breakdown for the Mengkham REE Project ( Unit: RMB M)
Item  Historical
Investment
Sustaining
Investment
Closure
Investment Total
Hydrometallurgy Plant Construction 7.93 25.80 - 33.73
Public Auxiliary Facilities  19.44 13.00 - 32.44
Engineering Construction Other Expenses  38.98 10.00 - 48.98
Closure Investment - - 15.17 15.17
Subtotal Investment  66.35 48.80 15.17 130.32
The project's cash Opex primarily include workforce employment,  consumables, fuel & electricity &
water and other services, on and off-site administration, envir onmental protection and monitoring,
transportation of workforce, product marketing and transport, n on-income taxes & royalties & other
governmental charges and contingency allowances.
Table ES- 6 summarized the forecasted Opex for the Project, wit h a total Opex of RMB4,264.61
million and a unit cost of approximately 30.90 RMB/t RoM or 167 ,697 RMB/t REO. All costs are
current as of 30 September 2024, with no escalation factored in.
Table ES- 6: Forecasted Opex of the Mengkham REE Project
Item LOM Total Cost
(RMB M)
Unit Cost
(RMB/t RoM)
Unit Cost
 (RMB/t REO)
Workforce employment 150.80 1.09 5,930
Consumables 2,020.41 14.64 79,448
Fuel, electricity, water and other services 153.65 1.11 6,042
On and off-site administration 29.65 0.21 1,166
– IIID-20 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xxi
Item LOM Total Cost
(RMB M)
Unit Cost
(RMB/t RoM)
Unit Cost
 (RMB/t REO)
Environmental protection and monitoring 30.52 0.22 1,200
Transportation of workforce 5.48 0.04 216
Product marketing and transport 38.15 0.28 1,500
Non-income taxes, royalties and
governmental charges 1,613.60 11.69 63,451
Contingency allowances 222.35 1.61 8,743
Total 4,264.61 30.90 167,697
Preliminary Economic Analysis
The Discounted Cash Flow (“DCF”) method was used for the econom ic analysis, as the project is
under the construction and pre-operation stage with a completed PFS. It is important to note that the
purpose of this analysis is solely to demonstrate the economic viability of the project. The derived
NPVs do not indicate the fair market values or the profitabilit y of the projects. The estimated cash
flows and NPVs were presented on an after-tax basis, and financing costs were not considered.
The net present value (“NPV”) of RMB471.23 million at 10% disco unt rate was estimated by SRK
through DCF model. The NPVs based on different discount rate we re also estimated, presented in
Table ES- 7, which has demonstrated the economic viability of the Project.
Table ES- 7: Estimated NPVs at Different Discount Rate  (Unit: RMB M)
Discount Rate 8% 9% 10% 11% 12%
NPV 527.96 498.69 471.23 445.47 421.26
Sensitivity analysis was conducted on Capex, Opex and price. The result indicates the NPV is most
sensitive to price, followed by Opex and Capex.
Risk Assessment
The results of the risk assessment rating are presented in Table ES- 8 below. The rating of the risks
is presented before implementation of control recommendations.
Table ES- 8: Project Risk Assess ment of the Mengkham REE Project
Risk Source/Issue Likelihood Consequence Overall
Geology and Resource
Lack of Significant Mineral Resources Unlikely Moderate Low
Lack of Significant Ore Reserves Possible Major High
Unexpected Groundwater Ingress Unlikely Minor Low
Mining
Subsidence and Ground Stability Possible Moderate Medium
Hydrogeological Modeling Uncertainties Unlikely Moderate Low
Significant Production Shortfalls Unlikely Major Medium
Significant Geological Structure Possible Minor Low
Ore Processing
Lower Recovery Unlikely Moderate Low
– IIID-21 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Executive Summary    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS xxii
Risk Source/Issue Likelihood Consequence Overall
High Production Cost Possible Minor Low
Poor Plant Reliability Unlikely Minor Low
Capital and Operating Costs
Project Timing Delays Possible Minor Low
Capital Cost and Operating Cost Increases Possible Moderate Med ium
High mine closure cost Possible Moderate Medium
Environmental, Social and Permitting
Environmental approval to be delayed Possible Moderate Medium
Water eutrophication Possible Moderate Medium
Fund not available and without proper mine
closure Possible Moderate Medium
Some medium to high risks have been identified for the Project.   Two high risks are “Lack of
significant Ore Reserves” and “Capital Cost and Operating Cost Increases”. To manage the risks,
SRK recommends the Company should further conduct supplemental exploration programs following
guidelines of the best practice to improve the mineral resource basis, and then conduct a feasibility
study.
Recommendations
Geology and Mineral Resources
The core drilling and geological logging were carried out to a standard that ensures the data and
information collected sufficiently support the goals of subsequent geological modelling and resource
estimation.
SRK considers that the depth capacity of manual auger drilling may not be enough to penetrate
potentially semi-weathered hard layers or boulders. This limita tion could potentially result in
incomplete intersections of the ore-bearing horizon during drilling.
Sepon
Looking ahead, the Sepon REE mine is considering in-situ leachi ng to be their main extraction
technique. However, the available data, which only includes 8 ionic analyses, falls short in providing
an accurate  estimate of the mine's potential and productivity. The scant data does not paint a holistic
picture of what the mine can offer. For this reason, SRK sugges ts a re-analysis of the ionic REE
grade. Through this, a clearer view of the mine's potential can be ensured, which is crucial in devising
and executing efficient mining plans.
Mengkham
SRK considers that the rapid test method, which entails visuall y observing rare earth precipitates
before conducting core sampling for laboratory analysis, is qua litative in nature. This approach
serves merely as an initial indication to assess the mineraliza tion within the sampled core interval.
Due to its inherent subjectivity , this method may result in ove rlooking certain shallow-occurring
intervals containing REE sufficient for subsequent laboratory t esting, potentially leading to an
underestimation of orebody thickness.
– IIID-22 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Executive Summary    Final
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The 1:5,000 topographic aerial survey only covered an area of 2 .3 km2. SRK suggests the mine to
conduct a detailed topographic survey covering the whole project area.
The mine's current approach is to analyse all basic samples in the lab onsite. While this might be
convenient and efficient, it may not provide the most accurate results. Large bias was observed
between original assay and SRK verification results. It is reco mmended that all the samples should
be sent to a qualified laboratory for assaying again.
There are merely 30 samples that possess REE compositions. This limited number prompts SRK to
recommend that the mine increase its efforts in conducting more composition analyses. This is to
ensure a more reliable and expansive dataset for evaluation purposes.
SRK also recommends carrying out more research on structure or fault system. This is because
faults may have a substantial influence on the in-situ leaching mining method.
Prefeasibility Study
SRK would recommends the Compan y to conduct a prefeasibility st udy on the Mengkham REE
Project once the supplemental exploration programs and resource  update have been completed to
optimize the development scheme of the project.

– IIID-23 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Introduction    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 1
1 Introduction
SRK Consulting China Ltd. (“SRK”) was requested by Chifeng Jilong Gold Mining Co., Ltd. (“Chifeng
Gold” or the “Client”) to prepare a Competent Person’s Report (“CPR” or the “Report”) for its Sepon
REE Project and Mengkham REE Project ( the “Projects”) located in Savannakhet Province, and
Xiengkhouang Province, Lao People’s Republic (“Laos ”), respectively, in accordance with the
guidelines of the Australasian Code for Reporting Exploration Results, Mineral Resources and Ore
Reserves, 2012 edition (“JORC Code (2012)”) and the Rules Governing the Listing of Securities on
The Stock Exchange of Hong Kong Limited (the “HKEx”).
The projects include exploration licenses, mining licenses, cur rently in-situ leaching mine, and
associated ore processing and metallurgic plants under construction and metallurgical leach testing.
The Sepon REE project is currently operated by Lane Xang Minera ls Limited (“LXML”), which is a
subsidiary of Chifeng Gold. The Mengkham REE project has a trial mining permit and an exploration
permit, which are held by China Investment Rare Earth Mining Co., Ltd. and China Investment Rare
Earth Mining XiangKhouang Co., Ltd., respectively. China Invest ment Mining (Laos) Sole Co., Ltd.
holds an 86% equity interest in both China Investment Rare Eart h Mining Co., Ltd. and China
Investment Rare Earth Mining XiangKhouang Co., Ltd. Since March  2024, Chixia Laos Holdings
Limited ("Chixia Laos") has been in the process of acquiring a 90% equity interest in China
Investment Mining (Laos) Sole Co., Ltd.
This report consists of an independent review of the geology, e xploration, mineral resources, Ore
Reserves, mining, mineral processing and smelter-refinery, capi tal investment, operating cost, and
environmental and social aspects of the Projects. The mineral r esource statement reported herein
was prepared in conformity with JORC (2012).
– IIID-24 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Program Objectives and Work Program   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 2
2 Program Objectives and Work Program
2.1 Purpose of the Report
The purpose of this Report is to provide both existing Chifeng Gold shareholders and potential
investors with a CPR of the Sepon REE Project and Mengkham REE Project in Laos. The SRK’s
report is proposed to provide an unbiased technical assessment of the risk associated with the
Project.
2.2 Scope of work and Reporting Standard
2.2.1 Scope of Work
The scope of work, as defined in letters of engagement executed in November 2022 and in May
2024 between Chifeng Gold and SRK, includes the reviewing/updat ing of mineral resource models
for the REE mineralization, delineated on the Projects, and rev iewing of a prefeasibility study done
on the Mengkham REE project and preparation of a CPR in complia nce with JORC (2012) and the
listing requirements of the HKEx.  This work involved the assessment of the following aspects of the
Projects.
 Regional, local and mine geology
 Exploration history, quality and independent data verification
 Geological modelling, mineral resource estimation and validation
 Mining assessment
 Processing and mineral recovery, smelter and refinery
 Environmental and social
 Operating and capital costs; and economic analysis
 Preparation of a Mineral Resource Statement and an Ore Reserve Statement, if any
 Recommendations for additional work
2.2.2 Basis of Technical Report
This report is based on information collected by SRK during site visits carried out in December 2022
and May 2024 and on additional information provided by the Comp any throughout the course of
SRK’s investigations. SRK has no reason to doubt the reliabilit y of the information provided by the
company. Other information was obtained from the public domain. This technical report is based on
the following sources of information:
 Discussions with personnel of the Sepon and Mengkham REE Projects
 Inspection of the Sepon and Mengkham REE Projects area, including outcrop and drill core
 Review of exploration data collected by the Company
 Additional information from public domain sources
– IIID-25 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Program Objectives and Work Program   Final
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This report has been prepared to accommodate the requirements o f HKEx, and the Mineral
Resources and Ore Reserves are reported according to the JORC (2012), which is binding upon all
Australasian Institute of Mining and Metallurgy (“AusIMM”) members.
2.2.3 Site Visit
SRK conducted site visits to both projects. During the period from 9 to 14 December 2022, SRK’s
personnel conducted site visits to the Sepon Project, gathered data and interviewed related
personnel who conducted exploration and feasibility study on the project.  During the period from 13
to 16 May 2024, SRK further conducted a site visit to the Sepon  REE Project  including an
examination of historical drill holes. No relevant production e quipment was observed on site. The
Sepon Project is an exploration project, and during the exploration process, sampling activities might
take place. During the period from 9 to 11 May 2024, SRK conduc ted site visits to the Mengkham
REE project, inspected and observed the status of the project, held meetings with the managements
and technical personnel, sighted geology, exploration, mineralization, the mining, ore processing and
metallurgic facilities in construction and metallurgical leach testing, as well as conducted its own data
verification programs, and assessed environmental and social aspects.
SRK was given a full access to relevant data and conducted interviews with Sepon/Mengkham REE
Project personnel to obtain information on the past exploration work, to understand procedures used
to collect, record, store and analyse historical and current ex ploration data, as well as operating
issues and data.
2.2.4 Reporting Standard
This Report has been prepared to the standard of, and is consid ered by SRK to be, a Technical
Assessment Report under the guidelines of the 2015 edition of the Code for Technical Assessment
and Valuation of Mineral Petroleum Assets and Securities for Independent Expert Reports  (the
“Valmin Code ”). The Valmin Code incorporates The JORC Code for the reportin g of Mineral
Resources and Ore Reserves and is binding upon all the Australa sian Institute of Mining and
Metallurgy (“AusIMM”) members.
This Report is not a Valuation Report and does not express an o pinion as to the value of mineral
assets. Aspects reviewed in this Report do include product pric es, socio-political issues and
environmental considerations; however, SRK does not express an opinion regarding the specific
value of the assets and tenements involved.
In this Report, identified Mineral Resources and Ore Reserves a re quoted using categorisation in
accordance with the JORC Code.  However, it should not be assumed that these Mineral Resource
and Ore Reserve Estimates have necessarily been carried out in accordance with the guidelines and
recommendations laid out in the JORC Code, at least until furth er documentation can be obtained
on the estimates and they have been formally endorsed by a “Competent Person” in accordance with
the JORC Code.
2.3 Limitations Statement
SRK is not professionally qualified to opine upon and/ or confirm that the Client has 100% ownership
of its underlying tenement and/ or has any unresolved legal mat ters relating to any transfer of
– IIID-26 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Program Objectives and Work Program   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 4
ownership or associated fees and royalties. SRK has therefore a ssumed that there are no legal
impediments regarding the existence of the relevant tenements and that the Client has legal right to
all underlying tenements as purported. Assessing the legal tenures and rights to the prospects of the
Client and or any of its subsidiary companies are the responsibility of legal due diligence conducted
by entities other than SRK.
2.4 Effective Date
SRK’s opinion contained herein and effective as of 30 September 2024 , is based on information
collected by SRK throughout the course of SRK’s investigations.  The information in turn reflects
various technical and economic conditions at the time of writin g this report. Given the nature of the
mining business, these conditions can change significantly over  relatively short periods of time.
Consequently, actual results may be significantly more or less favourable.
This report may include technical information that requires sub sequent calculations to derive
subtotals, totals, and weighted averages. Such calculations inherently involve a degree of rounding
and consequently introduce a margin of error. Where these occur , SRK does not consider them to
be material.
2.5 Work Program
The scope of work, as defined in letters of engagement reached in November 2022, and May 2024
between Chifeng Gold and SRK, includes the reviewing and estima ting of the mineral resource of
the REE mineralisation  delineated within the Sepon Project’ te nements and the Mengkham REE
project, and reviewing of a preliminary feasibility study on th e Mengkham REE project, and the
preparation of a CPR on the projects in accordance with JORC (2 012) and the listing requirements
of the HKEx.
SRK conducted the work programs on the projects in phases:
Phase 1:  SRK conducted a desktop review on the documents provided by th e client, before
conducting the site visits the project site;
Phase 2: SRK conducted site visits to both projects. During the period from 9 to 14 December 2022,
SRK’s personnel conducted site visits to the Sepon Project, to gather data and interview related
personnel who conducted exploration and feasibility study on the project.  During the period from 13
to 16 May 2024, SRK further conducted a site visit to the Sepon REE Project.  During the period from
9 to 11 May 2024, SRK conducted site visits to the Mengkham REE project, inspected and observed
the status of the project, held meetings with the managements a nd technical personnel, sighted
geology, exploration, mineralization, mining, ore processing and metallurgic facilities in construction
and metallurgical leach testing, as well as conducted its own data verification programs, and
assessed environmental and social aspects.
Phase 3: SRK team reviewed the information provided by Chifeng Gold, a nd estimated mineral
resources and reviewed the preliminary feasibility study on the  Mengkham REE project, conducted
a preliminary economic assessment on the project, and compiled a technical report about the
projects, and submitted it to the client for comments in June, August and November 2024.
– IIID-27 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1867 ---
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Program Objectives and Work Program   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 5
SRK will further revise the report based on the feedbacks from the client and related third parties,
and will finalize it in the due course.
2.6 SRK Experience
The SRK Consulting Group (“SRK Consulting”) is an independent, international consulting practice
that provides focused advice and solutions to clients, mainly f rom earth and water resource
industries. For mining projects, SRK Consulting offers services  from exploration through feasibility,
mine planning, and production to mine closure.
Among the company’s more than 1,500 clients are most of the world’s major and medium-sized metal
and industrial mineral mining houses, exploration companies, banks, petroleum exploration.
Formed in 1974 in Johannesburg, South Africa, SRK Consulting no w employs more than 1,800
professionals internationally in 42 permanent offices across 20 countries on six continents. A broad
range of internationally recognised associate consultants complements the core staff.
SRK Consulting employs leading specialists in each field of science and engineering. Its seamless
integration of services, along with its global base, has made t he company a world leader in due
diligence, feasibility studies, and confidential internal reviews.
SRK Consulting’s independence is ensured by the fact that it holds no equity in any project and that
its ownership rests solely with its staff. This enables the company to provide its clients with objective,
conflict-free recommendations on crucial judgement issues.
SRK China was established in 2005 and has three offices located in Beijing, Nanchang and Kunming.
Either independently or together with other SRK Consulting offi ces—especially SRK Australasia,
SRK has been providing independent technical services for the C hinese mining companies. SRK
has considerable experience at providing Independent Expert Rep orts for mining companies who
have successfully listed on the stock exchanges in Hong Kong, Australia, United Kingdom, Canada,
South Africa and the United States.
SRK has provided dozens of independent technical reports for th e Chinese mining companies who
have completed successfully list ed and/or acquired on the Stock  Exchange of Hong Kong Ltd., as
shown in Table 2-1.
Table 2-1: SRK’s Reports f or Listing on the HKEx
Company Year Nature of Transaction
Yanzhou Coal Limited (listed in
HKEx) 2000 Sale of Jining III coal mine to the listed operating
company
Chalco (Aluminium Corporation of
China) 2001 Listing on HKEx and New York Stock Exchange
Fujian Zijin Gold Mining Group 2004 IPO Listing on HKEx
Lingbao Gold Limited 2005 IPO Listing on HKEx
Yue Da Holdings Limited (listed in
HKEx) 2006 Acquisition of shareholding in mining projects in
Yunnan, China
China Coal Energy Company Ltd
(China Coal) 2006 IPO Listing on HKEx
– IIID-28 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Program Objectives and Work Program   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 6
Company Year Nature of Transaction
Sino Gold Mining Limited 2007 Dual Listing on HKEx
Xinjiang Xinxin Mining Industry Co.,
Ltd 2007 IPO Listing on HKEx
Kiu Hung International Holding
Limited 2008 Acquisition of shareholding in coal projects in Inner
Mongolia, China
Hao Tian Resource Group Limited 2009 Very Substantial Acquisition of two coal mines in Inner
Mongolia, China
Green Global Resources Holdings
Ltd 2009 Very Substantial Acquisition of shareholding in one
iron project in Mongolia
Ming Fung Jewellery Group Holdings
Ltd 2009 Acquisition of shareholding in gold project in Inner
Mongolia, China
Continental Holdings Limited 2009 Acquisition of a gold project in Henan, China
North Mining Shares Company
Limited 2009 Acquisition of a molybdenum mining project in
Shaanxi, China
CNNC International Ltd 2010 Acquisition of a uranium mine in Afr ica
Sino Prosper Mineral Products Ltd 2010 Acquisition of shareholdings in one gold project in
Inner Mongolia, China
New Times Energy Corporation Ltd 2010 Acquisition of shareholding in gold projects in Hebei,
China
United Company RUSAL Limited 2010 IPO Listing on HKEx
Citic Dameng Holdings Limited 2010 IPO Listing on HKEx
China Hanking Holdings Limited 2011 IPO Listing on HKEx
China Daye Non-Ferrous Metal
Mining Limited 2012 Very Substantial Acquisition on HKEx
China Nonferrous Mining Corporation
Limited 2012 IPO Listing on HKEx
Hengshi Mining Investments Limited 2013 IPO Listing on HKEx
Future Bright Mining Holdings
Limited 2014 IPO Listing on HKEx
King Stone Energy Group Limited 2014 Acquisition of Shareholding in silver mines in Fujian,
China
Agritrade International Pte LTD 2015 Acquisition of Shareholding in one coal mine in
Indonesia
China Unienergy Group Limited 2016 IPO Listing on HKEx
Pizu Investment Co. Ltd 2020 Acquisition of Shareholding in a polymetallic project in
China
China Qinfa Group Limited 2021 Annual disclosure of coal mines i n Shanxi, China
China Graphite Group Limited 2022 IPO Listing on HKEx
Kinetic Development Group 2022 Major transac tion of equity interest in Ningxia Sunshine
Persistence Resources Group Ltd 2023 IPO Listing on HKEx
2.7 SRK Project Team
The SRK project team and responsibilities are shown in Table 2-2.
– IIID-29 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Program Objectives and Work Program   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 7
Table 2-2: SRK Project Team
Consultant Title Discipline and Task
Dr. Anshun Xu Corporate Consultant (Geology) Project Manager, w hole report, CP
Huaixiang (Hubert) Li Senior Consultant (Geology) Geology, Miner al Resource Estimation
Erwei Lu Consultant (Mining) Mining Review
Yonggang Wu Principal Consultant (Mining) Mining Review, CP
Lanliang Niu Principal Consultant (Processing) Processing Revie w
Xiangfeng Yang Senior Consultant (Processing) Processing Review
Yuanhai Li Principal Consultant (Environment) Environment, Soci al, and Permitting Review
Dr Yonglian Sun Corporate Consult ant (Mining) Internal Peer Revie w and Quality Control
The short bios of key SRK personnel are shown below:
Anshun Xu (Anson Xu), Ph.D., FAusIMM, is a Corporate Consultant (Geology) who specializes in
the exploration of mineral deposits.  He has more than 30 years ’ experience in exploration and
development of various types of mineral deposits including Cu-Ni sulphide deposits related to ultra-
basic rocks, tungsten and tin deposits, diamond deposits, and REE deposits.   He recently completed
several due diligence jobs for clients from both China and over seas including technical review
projects such as Canadian NI43-101 reports and HKEx IPO technic a l  r e p o r t s .   D r .  X u  w a s  t h e
Projects Manager of this project and the Competent Person (“CP” ) who takes overall responsibility
for this report.
Huaixiang (Hubert) Li, MEng, MAIG, is a senior consultant (geology) with SRK China. He graduated
from the China University of Geosciences (Beijing) and has work ed in a geological exploration
company for more than 6 years and gained lots of experiences an d expertise in geological and
mineral resources exploration. As a consulting geologist, he ha s participated a number of metal
mineral projects, including expl oration design review, data ver ification, due diligence reviews and
mineral resource estimation. He is familiar with the principles  and methods for metal ore deposits
prospecting and exploration incl uding lithium, gold, silver, PG E, REE, copper, lead, zinc,
molybdenum, bauxite, etc. He is proficient in geological modell ing, resources estimation, data
processing and GIS/RS application. Mr. Li is responsible for the geology, exploration and mineral
resources, and is the Competent person of the mineral resources.
Yonggang Wu, (Mining and Reserves) ，，M.Eng., is a Principle Consultant (Mining). He joined
SRK after graduation from Jiangxi University of Science and Technology in 2007.  He has acquired
specialized knowledge in mining engineering, MineSight software and has been involved in various
projects to date. He has worked on a wide range of commodities including Au, Ag, Pb, Zn, Mn, Cu,
Fe, W, Sn, fluorite, potassium salts, alum, phosphorus, serpent ine, and many more. He has
accumulated extensive experience in Mineral Resource/ Ore Reser ve estimation, pit limit
optimization and design, underground mining design, long-term p roduction planning, mining
assessment, public facilities and infrastructures assessment an d due diligence studies. Yonggang
has expertise in geological and mining modelling and is profici ent in using MineSight, Surpac,
AutoCAD, and other specialized software packages.  He has been involved in dozens of independent
technical reports, due diligence reports and annual reports to provide investors, decision makers and
shareholders with unbiased technical opinions. Mr. Wu supervises Mr. Lu for the mining assessment,
and acts as the CP of ore reserves.
– IIID-30 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Program Objectives and Work Program   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 8
Erwei Lu,  M.Eng.; Consultant (Mining) at SRK China , he obtained his bachelor’s degree and
master’s degree in mining engineering from Central South Univer sity. He has over five years of
practice of underground operation, and about one year’s mineral  project evaluation experience. He
worked as an on-site mining engineer in Zambia for China Nonferrous Metal Mining (Group) Co., Ltd.
after graduation in 2017. He also worked for an autonomous driving application and mineral project
investment companies since 2022. He is familiar with large scal e underground mobile equipment
operation and training, long-hole blasting, mine design and scheduling, and production management,
as well as autonomous driving application in open pit mine, and project evaluation. Mr. Lu conducted
mining assessment under the supervision of Mr. Yonggang Wu.
Lanliang Niu, B.Eng., MAusIMM, is a Principal Consultant (Mineral Processing), who graduated
in 1987 from Beijing University of Science and Technology major ing in ore processing.  He has
worked on the industrial testing of gold leaching with low grad e ores, managed or participated in
processing and metallurgical testing for more than 10 precious and non-ferrous metals projects.  With
SRK, he has been responsible for the ore processing and metallu rgical scope of work and involved
in many key projects.  Mr. Niu was responsible for the metallur gical and processing review. Mr. Niu
peer reviewed Ms. Xiangfeng Yang’s work.
Xiangfeng Yang, MEng ; MAusIMM, Chinese Certified Mine Constructor, Chinese Certified
Mineral Right Value, Certified Cost Engineer,  is a Senior Consultant (Mineral Processing) with
SRK Consulting China Ltd. She has over 12 years’ experience in processing Feasibility Study,
processing design and technical consultancy service, especially in industrial minerals including gold,
silver, lead, zinc, copper as well as phosphate. She obtained bachelor's degree and master's degree
in mineral processing engineering from Jiangxi University of Sc ience and Technology and Wuhan
University of Science and Technology, during which she systemat ically studied the processing
flowsheet and plant design on nonferrous metals ore and non-metallic ores. Before joining SRK, she
engaged in ore Feasibility Study, preliminary design, construct ion drawing design and equipment
procurement evaluation in Bluestar Lehigh Engineering Institute  Co., Ltd and Nanchang Mineral
Systems Co. Ltd. She has published several journal papers and u tility models, conducted and
participated in the plant design of many medium and large phosp hate ore, potash salt, sulfide ore,
iron ore and other projects.  Ms. Yang reviewed the processing and metallurgic aspects, as well as
the economic analysis.
Andy Li, PhD, MAusIMM, is a Principal Environmental Consultant  with SRK Consulting China
Ltd. Having graduated with a doctoral degree in Environmental E ngineering from the Florida State
University, he has over 12 years’ experience in the environmental engineering field and has worked
in various environmental projects in the USA, China, Mongolia, and a number of South Asian
countries. He has particular expertise in environmental due diligence reviews, environmental
compliance, and impact assessments for mining, mineral processi ng, refining, and smelting; in
contaminated-site assessments a nd remedial design; in wetland a nd landfill rehabilitation; and in
environmental-risk assessment. He also has extensive experience  in water/wastewater treatment
design, water distribution system s, and storm water management system design. Dr. Li was
responsible for the environmental, permit, social and community review.
Yonglian Sun, B.Eng. PhD, FAusIMM, FIEAust, CPEng., is a Corporate Consultant and a Practice
Leader of SRK China. Dr Sun has over 30 years experience in geotechnical engineering and mining
engineering in five countries across four continents. He also has extensive international experience
in mining project evaluation for project financing and overseas  stock market listings. Over the last
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APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Program Objectives and Work Program   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 9
decade, Dr Sun has led and coordinated dozens of due diligence projects for many mining companies
and most of them have been successfully financed or listed on the HKEx. Dr Sun provided internal
peer review to ensure the quality of the report meets the required standard.
2.8 Warranties
Chifeng Gold has warranted to SRK that full disclosure has been  made of all material information
and that, to the best of their knowledge and understanding, suc h information is complete, accurate
and true. SRK has no reason to doubt these warranties.
Based on the information provided by Chifeng Gold, there are no  events that have occurred since
the Effective Date that are likely to have a material impact on  the Mineral Resource and Mineral
Reserve statements for the Sepon and Mengkham REE Projects at the date of publication of this
CPR.
2.9 Compliance Statement
The information in this report that relates to Mineral Resources/Ore Reserves is based on information
compiled by Dr. Anshun Xu, a Competent Person who is a Fellow of the AusIMM, and Mr. Yonggang
Wu, a Competent Person Who is a Member of the AusIMM. Both are full time employee of SRK
Consulting China Ltd.
This Report is a Competent Person’s Report in line with the Listing Rules of the Exchange and HKEX.
Dr. Anshun Xu has no prior association with Chifeng Gold in reg ard to the mineral assets that are
the subject of this Report.  Dr. Anshun Xu has no beneficial in terest in the outcome of the technical
assessment being capable of affecting its independence.
Dr. Anshun Xu and Mr. Yonggang Wu have sufficient experience th at is relevant to the style of
mineralisation and type of deposit under consideration and to the activity being undertaken to qualify
as a Competent Person as defined in the JORC Code”.
Dr. Anshun Xu and Mr. Yonggang Wu consent to the inclusion in the report of the matters based on
their information in the form and context in which it appears.
Peer review and quality control of the Report were conducted by  Dr. Yonglian Sun, FAusIMM (CP
Eng), a Corporate Consultant (Mining and geotech).
2.10 Independence Statement
Neither SRK nor any of the authors of this Report have any material present or contingent interest in
the outcome of this Report, nor do they have any pecuniary or other interest that could be reasonably
regarded as being capable of affecting their independence or that of SRK.
SRK’s fee for completing this Report is based on its normal pro fessional daily rates plus
reimbursement of incidental expenses. The payment of that professional fee is not contingent upon
the outcome of the Report.
SRK has no prior association with Chifeng Gold or Chifeng Gold’ s employees or in regard to the
mineral assets that are the subj ect of this Report. SRK has no beneficial interest in the outcome of
– IIID-32 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Program Objectives and Work Program   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 10
the technical assessment being capable of affecting its indepen dence. SRK is independent of
Chifeng Gold applying all of the tests in 18.21 and 18.22 of th e Listing Rules of the Exchange and
HKEX.
SRK is not an insider, associate or an affiliate of Chifeng Gold, and neither SRK nor any affiliate has
acted as advisor to Chifeng Gold, its subsidiaries or its affiliates in connection with the projects. The
results of the technical review by SRK are not dependent on any  prior agreements concerning the
conclusions to be reached, nor are there any undisclosed unders tandings concerning any future
business dealings.
2.11 Consent
SRK consents to this Report being included, in full, in documen ts that Chifeng Gold proposes to
submit to the HKEX and/ or disclo sure to the public markets, in  the form and context in which the
technical assessment is provided, and not for any other purpose.
SRK provides this consent on the basis that the technical asses sments expressed in the Executive
Summary and in the individual sections of this Report are considered with, and not independently of,
the information set out in the complete Report and the Cover Letter.
2.12 Forward Looking Statement
Estimates of Mineral Resources, Ore Reserves (if applicable), and mine production (if applicable)
are inherently forward-looking statements, which being projecti ons of future performance will
necessarily differ from the actual performance. The errors in such projections result from the inherent
uncertainties in the interpretation of geologic data, in variat ions in the execution of mining and
processing plans, in the inability to meet construction and production schedules due to many factors
including weather, availability of necessary equipment and supplies, fluctuating prices, ability of the
workforce to maintain equipment, and changes in regulations or the regulatory climate.
The possible sources of error in the forward-looking statements are addressed in more detail in the
appropriate sections of this report. Also provided in the report are comments on the areas of concern
inherent in the different areas of the mining and processing operations.
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APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Operational Licenses and Permits    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 11
3 Operational Licenses and Permits
This section summarises related operational licences and permit s. SRK relied on the information
provided by the Company, and SRK understands that a legal due diligence review of this Project has
been undertaken by the Company’s legal advisors.
3.1 Sepon REE Project
Currently, LXML possesses an exploration permit with a total area of 996.12 km2 for copper and gold
only, which is valid till June 2026. The exploration permit consists of 66 inflection points which have
been provided in Table 3-1 below. Please note that the Sepon REE Project area is located within the
southeastern corner of the permitted area, and the REE exploration permit application is in process.
REE exploration activities is intended to be carried out upon the approval of the application.
Table 3-1: Inflection Points of Sepon Exploration Permit
Coordinates（（Indian60/UTM zone 48N)
No. Easting Northing No. Easting Northing No. Easting Northing
1 576400 1882200 23 627800 1878000 45 592000 1871800
2 585600 1882200 24 639800 1878000 46 590800 1871800
3 585600 1879600 25 639800 1872200 47 590800 1872400
4 588800 1879600 26 634000 1872200 48 589200 1872400
5 588800 1881000 27 634000 1870600 49 589200 1873200
6 593200 1881000 28 624800 1870600 50 587400 1873200
7 593200 1882200 29 624800 1868200 51 587400 1874000
8 597600 1882200 30 616400 1868200 52 585600 1874000
9 597600 1893200 31 616400 1862200 53 585600 1874600
10 606000 1893200 32 654400 1862200 54 583800 1874600
11 606000 1890800 33 654400 1856200 55 583800 1875200
12 604400 1890800 34 625000 1856200 56 582400 1875200
13 604400 1887400 35 625000 1861600 57 582400 1875800
14 613200 1887400 36 615400 1861600 58 581000 1875800
15 613200 1892200 37 615400 1863200 59 581000 1876400
16 615000 1892200 38 608000 1863200 60 579600 1876400
17 615000 1894800 39 608000 1867200 61 579600 1877000
18 619000 1894800 40 598000 1867200 62 578800 1877000
19 619000 1892600 41 598000 1867800 63 578800 1877600
20 622000 1892600 42 594600 1867800 64 577400 1877600
21 622000 1881200 43 594600 1869000 65 577400 1878000
22 627800 1881200 44 592000 1869000 66 576400 1878000
3.2 Mengkham REE Project
3.2.1 Trial Mining License
Table 3-2 which is renewable, and the scanned copy of the original trial mining license is attached in
Appendix A. Please note that the Company is in the process of renewing this license.
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APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Operational Licenses and Permits    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 12
Table 3-2: Trial Mining License
Name of Mine Mengkham Rare Earth Mine
Ming License No. MPL0156
Issued to China Investment Rare Earth Mining Co. Ltd
Issued by Ministry of Mine and Energy
Area (km2) 8.0
Issuing Date 28 December 2022
Expiry Date December 2025
3.2.2 Exploration Permit
Table 3-3 summarizes the key information of the exploration permit.
Table 3-3: Exploration Permit
Name of Mine Mengkham Rare Earth Mine
Ming License No. 2122 No.3
Issued to  China Investment Rare Earth Mining Xiangkhouang Co. Ltd
Issued by  Ministry of Mine and Energy
Area (km2) 42.0
Issuing Date 28 December 2022
Expiry Date December 2024
3.2.3 Other Key Operatio nal Licenses and Permits
The Company has obtained land use agreements with the locals for the site operation, and SRK was
provided with sample agreements for review. They include information regarding land area, items for
compensation, etc. Other license and permits for water use perm it or discharge permit are under
application process.
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APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Accessibility, Climate, Local Resources, Infrastructure and Physiography  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 13
4 Accessibility, Climate, Local Resources,
Infrastructure and Physiography
The Sepon project is in Sepon County, Savannakhet Province, Lao PDR. The property is situated in
the southern part of the Sepon gold and copper Mine.
The Mengkham REE Project is located in Mengkham County, XiengKhouang Province, Lao People’s
Democratic Republic. The property is situated between latitudes  19°48’ and 19°51’ north, and
between longitudes 103°39’ and 103°41’ east.
The locations of the two projects are shown in Figure 4-1.
Figure 4-1: Locations of The Sepon and Mengkham REE Projects

Source:SRK
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APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Accessibility, Climate, Local Resources, Infrastructure and Physiography  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 14
4.1 Sepon Rare Earth Element Deposit
4.1.1 Accessibility
The Sepon REE project is in Savannakhet province, south-central Laos (Figure 4-2).  Access to the
project area from Vientiane, the capital of Laos may take about 1.5 hours flight or about 8 hour drive
for a distance about 560 km.  There are daily charter flights available between Vientiane and Sepon
mine in weekdays. There are also daily flights between Vientiane and Chinese, Vietnam and Thailand
cities. Alternate access to the project is about 1 hour flight between Vientiane and Savannakhet and
then about 4-hours bus ride between Savannakhet to Sepon.
Figure 4-2: Location of Sepon REE Project

Sources: SRK
4.1.2 Local Resources and Infrastructure
In the Sepon Project region, the vegetations are abundant with eucalyptus forest and bushes.
Villages are widely distributed in the area, and villagers gene rally work in agriculture and forestry
productions.  Rice is the main crop and Manihot is also important crop. Industry is not well developed.
Labours are abundant, while technical personnel are absent.
Power line of 220 KV goes through the area and supplies the ele ctricity. Telephones and mobile
communication are available.
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APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Accessibility, Climate, Local Resources, Infrastructure and Physiography  Final
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4.1.3 Climate and Physiography
The climate in the project area belongs to tropic climate with northeast monsoon and southwest
monsoon.  The raining season relates to the southwest monsoon a nd is characteristics of heavy
rainfall, high temperatures and high moistures, and lasts from mid-April to mid-October.  The dry
season lasts from mid-October to mid-April in the following year with the characteristics of less rains
and relatively lower temperatures and moistures, while the drie st season is from mid-November to
mid-February of the following year.
4.1.4 Physiography
The Sepon project area has a geomorphology of low-mid mountains.  The elevations generally range
from 240 to 420m above sea level (“ASL”).  The highest point in  the mountainous area in the north
is 755.0m ASL. In the mine area, the relative elevation differences are about 50 to 100m.
The mountain ranges generally strike near East-West.  Water run s from the slope of each side to
small streams.  During dry the season, most of the small streams are dried out, while the small rivers
which the small streams flow into have the running water all ye ar round. The small rivers flow into
Sebanghiang River in the foot o f the south slope, and the Seban ghiang River flows into Mekong
River.
4.2 Mengkham REE Project
4.2.1 Accessibility
The project is situated in Longmou Village and Soumont Village, Mengkham County, in the northern
part of Xiengkhouang Province (Figure 4-3). There are daily com mercial flights available between
Vientiane, the capital of Laos, and Phongsavan, the capital of Xiengkhouang Province.  Provincial
highway, 1C, runs through the mining area, linking Phongsavan and Sangnu, the capital of Houaphan
Province. Traveling from Mengkha m County town to the project ar ea along highway 1C is
approximately 45 kilometers, all of which are winding mountain roads with asphalt surfaces. These
roads can be dangerous due to many curved turns. The project is roughly 100 kilometers away from
Phongsavan and around 140 kilometres from Sangnu, making transp ortation generally
straightforward. Certain parts of the mining area have been sur faced with sand and stone, allowing
for vehicular access in both rainy and dry seasons.
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APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Accessibility, Climate, Local Resources, Infrastructure and Physiography  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 16
Figure 4-3: Location of  Mengkham REE Project

Sources: SRK
4.2.2 Local Resources and Infrastructure
Xiengkhouang province is located in the northeast of Laos, bordering Vietnam to the east. The capital
is Phongsavan and the province is divided into eight districts.  As of 2020, it has a population of
267,179 and covers an area of 15,800km2.
XiengKhouang province is a multi-ethnic region primarily inhabi ted by Lao Long (Dai), Lao Song
(Miao), and Lao Listen (Yao). It has a pleasant climate and fertile land, making it suitable for growing
semi-plateau plants, cultivating vegetables, and breeding cattle and other livestock. The province is
rich in minerals like iron, antimony, zinc, silver, copper, alluvial gold, and coal.
Traditional industries include silk weaving, bamboo weaving, ironwork, pottery, and food processing.
The region is also home to sewing factories, ice factories, beverage factories, sawmills, waterworks,
and automobile repairing shops. Rice paddies dot the river valleys and parts of the shallow hills. The
Shigang Plain, a famous tourist attraction in Laos, is also located there.
The mine is located near two villages, Longmou and Soumont, whi ch collectively house about 394
households or 2,907 people, including 1,512 men and 1,395 women. The residents primarily engage
in farming, hunting, and storekeeping, though the economic condition of the area is relatively poor.
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APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Accessibility, Climate, Local Resources, Infrastructure and Physiography  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 17
Locals mainly use diesel and gasoline for fuel, which are conve niently supplied in townships,
counties, and urban areas. Construction materials such as cement, sand, stone, and steel bars are
available in urban areas.
Mobile communication companies, LAO TELECOM and UNITEL, provide domestic and international
telephone services within the mining rights area.
The mining area has sufficient power supply with a township power grid. However, due to high power
consumption, a new substation is required to supply electricity in the mining area.
4.2.3 Climate
The climate in the area belongs to the Southeast Asian tropical rainforest climate zone, characterized
by changeability, long sunshine hours, strong ultraviolet radiation, large diurnal temperature
differences, and year-round hot and humid weather. Influenced by the monsoon climate, the year is
divided into dry and rainy seasons. The rainy season is from Ju ne to October, with occasional
thunderstorms and heavy rains, abundant rainfalls, which cause roads muddy, air humid, travel
difficult, so it is unsuitable for outdoor geological work. The  dry season is from November to the
following May. The weather is clear and less rainy, and the temperature is relatively mild, making it
the golden season for outdoor geological work. However, in April, it is often continuously hot, which
is the highest temperature period of the year. Temperatures hover between 36℃ and 43℃. Outdoor
activities should be avoided as much as possible to prevent hea tstroke. The province of
Xiengkhouang belongs to the Laoti an plateau, where the temperat ure varies greatly between day
and night in the dry season. From November to February of the f ollowing year, the lowest
temperature is 5-6℃.
The mining area is relatively high in terrain, with undeveloped  surface water bodies. The only
recharge source of groundwater is atmospheric precipitation. In  addition to running off along the
slope into nearby streams, atmospheric precipitation is partly consumed by evaporation and plant
transpiration. The remaining part infiltrates down through the loose layer of the Quaternary and the
fissures of the weathered crust of the bedrock to form undergro und seepage, with the recharge
degree mainly controlled by the terrain. In areas with steeper terrain, atmospheric precipitation easily
forms surface runoff into nearby streams. In areas with relatively gentle terrain, the main method is
infiltration, partly recharging deep groundwater. The direction of groundwater seepage in the mining
area flows from relatively high to relatively low terrain.
The mining area is located in the mountains and is the watershe d area of the hydrogeological units
in the region. There are no large-scale surface water bodies, b ut many mountain streams have
developed, branching out like tree branches. There are two type s of water source replenishment
methods: one is precipitation replenishment, and the other is g roundwater seeping out along the
bank of the ditch. There are no centralized water outlets. The stream flow gradually increases from
upstream (the source is located in the mining area) to downstre am. The surface water is clear and
transparent, slightly turbid in the rainy season, and the content of mud and sand increases. All areas
within the mining area are above the local erosion base level, and there is no impact of surface water
on future mining.
– IIID-40 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Accessibility, Climate, Local Resources, Infrastructure and Physiography  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 18
4.2.4 Physiography
One-fifth of Xiengkhouang province is plains, while the remaining four-fifths consist of mountains and
plateaus. The average elevation in the northern part exceeds 1, 500 meters above sea level. The
highest peak, Bia Mountain, located in Xiengkhouang province, stands at 2,820 meters. Other peaks
in the province rise over 2,000 meters.
The northwestern region of the province is rugged, remote, and isolated, with rivers that swell in the
rainy season. The Truong Son Mountain range in the eastern part of the province descends gradually
from north to south, with an average elevation of 1,200 meters in the south. The Truong Son range
acts as the natural boundary between Laos and Vietnam. Areas ne ar the Truong Son range are
characterized by highlands and mountains.
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APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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History    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 19
5 History
5.1 Sepon Rare Earth Element Deposit
The REE project of Sepon is located in the southeast of the min ing area, with an area of 209km 2,
and is about 20-50km straight line distance from the main minin g area. The exploration history is
summarized as follows:
From 1995 to 1996, CRAE Company conducted prospective work in this area.
From 1997 to 1998, CRAE Company carried out mapping, water syst em sediment measurement,
block sample analysis, etc. in this area. The highest grade of Au ore found in the grabbed sample is
4.7 g/t.
In 2008, OZ Company carried out mapping work in the western part of this block and delineated the
distribution range of granite.
In 2009, OZ Company carried out geological mapping and soil sam pling work in the eastern part of
the project and delineated the dist ribution range of granite. D uring the mapping, silicified
conglomerates were found on the surface, the highest Au grade w as 2.18 g/t, and sulfide veinlets
could be seen in the Highway group sandstone.
In 2021, the exploration department of LXML restarted geological exploration work in the area,
carried out geological mapping and physical and chemical measurement work, and found that granite
was widely distributed in the area during the mapping and soil measurement, and the granite-covered
area had a significant rare earth anomaly, with the characteris tics of ion-adsorption type rare earth
deposits in the weathering crust.
5.2 Mengkham Rare Earth Project
Since 1987, Laos has been carrying out 1:200,000 geological map ping. The 1:200,000 geological
map with the code E-48-Ⅱ (KHANGKHAI AREA) includes the mining area.
In 1988, the Soviet Union and Vietnam published six geological maps for Vietnam, Laos, and
Cambodia. In 1990, the United Nations published a 1:500,000 geo logical map of Laos, a Laos
mineral resources distribution map, and explanatory notes. These were edited by the United Nations
Economic and Social Commission for Asia and the Pacific (“ESCAP”).
In 1991, Peter J. Cook of the British Geological Survey and Dr. Bosay Kham of the Lao Geology and
Minerals Bureau published a Lao People's Democratic Republic mi neral distribution map
(1:1,000,000).
From September 1990 to March 1991, a five-person team from the British Geological Survey created
two new English computer databases for geological books and min eral resources of the Vientiane
Geology and Minerals Bureau. The creation was supported by the West Asia Development Bank.
The team also prepared a new coloured geological and mineral map (1:1,000,000).
With the progress of China's "One Belt, One Road" initiative and funding from the China Geological
Survey, Laos completed a 1:1 million geochemical filling map. This filled the gap in the national scale
geochemical filling map of Laos. The project collected 1905 geochemical samples in the territory (net
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APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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History    Final
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degree 10km×10km). The content of 71 elements was analysed using various testing methods, and
geochemical maps and geochemical anomaly maps were compiled.
In 2022, China Investment Mining (Laos) Sole Co., Ltd. organize d detailed exploration work. It
resulted in a cumulative total of 13,656 drilling holes and approximately 200,000 meters.
From 2022 to 2023, detailed exploration work was carried out in  the mining area. The resources of
ionic rare earth oxides within the mineral rights range were es timated based on the detailed
exploration data.

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APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Geological Setting and Mineralization   Final
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6 Geological Setting and Mineralization
6.1 Regional Geology
Tectonically, Sepon and Mengkham REE project lie within the Tru ongson Fold Belt (or Annamite
Cordillera) and the Kontum Massif. The Truongson Fold Belt is a NW elongated belt between South
China Terrane and Indochina Terrane (Figure 6-1).
The Truongson Fold Belt is consisted of Early to Middle Palaeoz oic sediments and lesser volcanic
rocks, interspersed with lesser tectonic slices of metamorphic terranes, bound to the north by the
Song Ma-Song Da suture zone and to the south by the NW trending  Truongson Fault. The Kontum
Massif comprises an Upper Prot erozoic basement of ortho- and pa ra-gneiss, crystalline schist and
migmatite which abuts the Truongson Fold Belt to the south.
Figure 6-1: Regional Geology Setting

The main strata in the region include the Proterozoic low to mid-high grade metamorphic rocks, such
as schist, marble and gneiss; Palaeozoic marine volcanic and se dimentary rocks with some
continental volcanic and sedimentary rocks, such as limestone, sandstone, siltstone, shale,
mudstone and marlstone; Mesozoic continental sedimentary rocks, such as red sandstone and clay;
and Cenozoic loose sand and gravel. In the Sepon district, the Truongson Fold Belt is represented
by a series of E-W trending basins which are truncated by the N W-striking Truongson Fault (Figure
6-1).  Affected by the Fault, NW and nearly S-N striking faults were developed, with some secondary
faults striking NE and nearly E-W.
Granitic intrusions have been mapped in the district as well as  rhyodacite and andesite dykes and
stocks, interpreted to be part of the Late Palaeozoic Variscan Orogeny. At least three phases of
around 300 Ma rhyodacite porphyry intrusion are recognised, inc luding a late, quartz-stockwork
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EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Geological Setting and Mineralization   Final
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veined phase, which is interpreted to be genetically associated  with all known Cu and Au
mineralisation in the field. Minor  remnants of Jurassic to Cret aceous Khorat Basin continental
sedimentary rocks unconformably overlie the Palaeozoic marine sedimentary sequences to the east
and north, while west of the Kontum Massif and south of the Tru ongson Fault, Khorat sedimentary
rocks are dominant. Cenozoic volcanic rocks unconformably overl ie the Palaeozoic rocks to the
north-east.
There are abundant mineral resources in the region, including gold, copper, lead-zinc and limestone
resources, as well as coal, iron, REE and bauxite resources.
6.2 Property Geology
6.2.1 Sepon Rare Earth Element  Deposit Property Geology
The exposed strata in Sepon area mainly include Archean gneiss,  Ordovician Highway Group,
Silurian Vang Ngang Group, Devonian calcareous shale and limestone, and Quaternary (Figure 6-2),
with the lithological characteristics described as follows:
Archean gneiss: This includes biotite gneiss, two mica gneiss, white mica plagioclase gneiss, biotite
quartzite, and schist. It is mainly distributed in the southern part of the work area.
Ordovician Highway Group: The Highway Group mainly consists of clastic rock marine sedimentary
sequences. The lower segment of the Highway Group is mainly composed of thickly bedded feldspar
sandstone, irregularly interbedded with a small amount of siltstone, mudstone, and shale. Lenticular,
thinly bedded to bedded calcareous sandstone and limestone layers appear at the top of this
segment. The composition of the upper segment of the Highway Gr oup is similar to the lower
segment, characterized by medium to thick beds (0.1 ~ 1m, avera ging 0.4 m thick) blocky quartz-
feldspar-mica sandstone interbedded with thin to bedded siltstone, banded siltstone, and mudstone-
shale. It mainly distributed in the northern part of the work area.
Silurian Vang Ngang Group: The Vang Ngang Group is characterize d by very good bedding, thin
layers (2 cm-15 cm) and rhythmically bedded red and green silts tone, which is often silicified into
flint. Unlike the underlying Highway Group, the sediments of th e Vang Ngang Group are non-mica-
bearing. The siliceous rock is underlain by a limestone unit, w hich is typically light gray, fossil-free,
massive, and almost devoid of internal structure except for sut ures. The top of the Vang Ngang
Group is marked by graptolite shale, which is a thin-bedded black carbonaceous shale unit containing
common graptolite fossils. The Vang Ngang Group is exposed in a small area in the central-northern
part of the work area.
Devonian calcareous shale and limestone: A small area of nodular or angular calcareous shale and
limestone bedrock is exposed in the middle eastern part of the work area. It is currently believed that
the Jasporid metamorphic rock found in the mining area, which i s gold-mineralized, may be related
to this.
Quaternary: These mainly consist  of Quaternary colluvial and al luvial sediments. The colluvial
deposits are widely distributed in the broad gentle slopes and footslope areas within the region,
mainly composed of residual, slope, alluvial sand, clay and oth er rock fragments, with a large
thickness variation, generally greater than 2m; the alluvial deposits are mainly distributed along rivers
– IIID-45 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Geological Setting and Mineralization   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 23
and channels, mainly composed of gravel, sand, and clay, with a large thickness variation, generally
greater than 5m.
Folds and fault structures are well developed in this area. Acc ording to the direction, the fault
structures can be divided into t wo groups: northeast and northw est. They are large in scale. The
northeast faults developed earlier and are of a compressive-tor sional nature. They are offset by
northwest tension-torsional faults, with displacements ranging from tens to hundreds of meters.
There is intense magmatic activity in the area, mainly composed  of granites of Indosinian period.
These granites are contemporaneous with the Que Son mixtures in Vietnam. The Permian-Triassic
intrusions consist of granites and granodiorites, representing the main stage of the Indosinian
orogeny/rise. Magmatic rocks are followed by a small number of andesite veins developed near east-
west. The granodiorite and granite bodies are generally distrib uted in an east-west band, with the
mining area mainly divided into two east-west areas, covering an area of about 50 square kilometres.
The ion-adsorption type rare earth ores in this area are housed  in the weathering crusts of
granodiorite and granite. Granite is directly exposed to the su rface, and under surface weathering,
the original rock decomposes, and rare earth elements selective ly migrate, forming a weathered
crust rich in ionic rare earth s. The main conditions controlling the development and preservation
degree of the weathering crust are climate and topographic conditions.
Figure 6-2: Local Geologica l Map of the Sepon Project
Sources: LXML.
6.2.2 Mengkham Rare Earth Project
The strata exposed in the area primarily consist of the Carboni ferous, Permian, Triassic, and
Quaternary. The area features pronounced faults and folds, vertical and horizontal zoning, cleavage
and fault zones, and frequent volcanic activity. As a region fa vourable for non-ferrous and precious
metal mineralization, this area demonstrates significant mineral potential.
– IIID-46 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Geological Setting and Mineralization   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 24
The exposed strata in the area are the Carboniferous-Permian No nghei Group (C-Pnh), the Upper
Triassic Namu Group (T3n-rnn), and the Middle Triassic (T2anm2), detailed in Figure 6-3, mainly as
follows:
Carboniferous-Permian Nonghei Group (C-Pnh): Grey and black rec rystallized limestone, white
quartzite.
Upper Triassic Namu Group (T3n-rnn):  Coarse conglomerate, quartz sandstone and lenticular peat.
Middle Triassic (T2anm2):  Siltstone, mica-bearing sandstone, sheet limestone.
Figure 6-3: Local Geological Map of the Mengkham REE Project
Sources: Modified after China Investment Mengkham Rare Earth Minerals Limited.
The North Changshan metallogenic belt where the mine is located is one of the oldest blocks in Indo-
China Peninsula.  Influenced by the evolution of the Tethys Ocean basin, the main tectonic direction
is NW, and secondary EW trending fault structures are developed .  The working area is located at
the junction of the "T" structure. The Himalayan Indochina plat e rotates clockwise to form the right-
lateral strike-slip structure which has a profound influence on it.
– IIID-47 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Geological Setting and Mineralization   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 25
The magmatic rocks of Mengkham REE Project are mainly Triassic granite and biotite granite, which
are also the main ore-bearing horizon of rare earth ore.
Granite: the colour is grey-white, and the main composition is quartz (about 55%) and plagioclase
(about 40%). The rock surface is strongly weathered, sand like,  sericite, kaolin, rare earth
mineralization is weak.
Biotite granite: the colour is clay yellow to grey white, the m ain composition is Quartz (about 50%),
plagioclase (about 35%), biotite (about 15%).  The rock surface  is strongly weathered and sandy.
The local characteristics of the rock are potassium mineralizat ion, sericite mineralization, kaolin
mineralization and rare earth mineralization.
6.3 Mineralization
6.3.1 Sepon Rare Earth Element  Deposit Property Geology
This deposit is a granite weathering crust ion-adsorption type rare earth deposit. The ore bodies are
all in the middle and lower parts of the weathering crust, and the ore from the surface can be seen
in a few boreholes. The weathering crust is vertically stratifi ed from top to bottom as completely
weathered layer and semi-weathered zone.
Completely weathered layer: brown -yellow, light yellow, light r ed, and gray-white. The main
components are clay and a small amount of quartz. The structure  is loose and porous, and the
original rock structure is no longer visible. The content of rare earth oxides (TREO) is relatively high,
generally between 0.030% and 0.167%. The thickness is generally  3 to 10 meters, mostly 5 to 8
meters. The fully weathered layer is the main location of the rare earth ore body.
Semi-weathered layer: brown-yellow, light yellow, and light red . The main components are clay, a
small amount of feldspar weathering residues, and quartz. The o riginal rock structure is still
preserved, and the feldspar has a complete shape and is relatively hard. The thickness varies greatly,
generally 1 to 3 meters, and the thickest can reach 5 meters. The content of rare earth oxides (TREO)
gradually decreases from top to bottom, the upper part can be e nriched into a rare earth ore body,
and the end hole position of a small part of the drill hole has  a higher grade, and it may not be able
to penetrate the weathering layer.
The elevation of the ore body is 240 to 410 meters, the lowest erosion base level in this area is 210
meters, and the ore body is above the lowest erosion base level.
The depth of the ore body is generally 0-5 meters. The TREO gra de ranges from 310 to 830 g/t,
averaging 440 g/t.
– IIID-48 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Geological Setting and Mineralization   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 26
Figure 6-4: Section Map of  Sepon Project (633610E)

Sources: LXML.
The typical TREO composition chart is presented in Figure 6-5. The approximate range of TREO
composition is as follows: praseodymium-neodymium (PrNd) oxides  18.9%, magnet rare earth
oxides (“MREO”) 21.62%, and critical rare earth oxides (CREO) account for 33% of the total TREO
content (Table 6-1).
Figure 6-5: TREO Composition of Sepon Project

Sources: SRK.
Table 6-1: Typical Content and Co mposition of the TREO for Sepon Project
Item Content (g/t) %/TREO
TREO 352 100
Y2O3 53 15.05
– IIID-49 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Geological Setting and Mineralization   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 27
Item Content (g/t) %/TREO
La2O3 75 21.37
CeO2 115 32.57
Pr6O11 15 4.29
Nd2O3 51 14.61
Sm2O3 10 2.72
Eu2O3 2 0.62
Gd2O3 9 2.47
Tb4O7 1 0.39
Dy2O3 8 2.33
Ho2O3 2 0.48
Er2O3 5 1.39
Tm2O3 1 0.20
Yb2O3 5 1.31
Lu2O3 1 0.20
Notes:
1 MREO: Pr6O11+Nd2O3+Tb4O7+Dy2O3.
2 CREO: Nd2O3 + Eu2O3 + Tb4O7 + Dy2O3 + Y2O3，determined by US Department of Energy 2023.
3 TREO: Total Rare Earth Oxides include Y2O3+ La2O3 + CeO2 + Pr6O11 + Nd2O3 + Sm2O3 + Eu2O3 + Gd2O3 + Tb4O7 + Dy2O3
+ Ho2O3 + Er2O3 + Tm2O3 + Yb2O3 + Lu2O3.
6.3.2 Mengkham REE Project
The rare earth minerals in Mengkham area consist of a medium-fine biotite granite regolith. Notably,
there are significant differences among the rock regolith. As a  result, the ore composition and type
are directly linked to the regolith characteristics and its roc k types. The weathering crust can be
divided into three layers: tops oil, completely weathered zone, and semi-weathered zone. These
layers transition gradually, with the ore primarily composed of full regolith and a portion of the topsoil.
Topsoil: This layer mainly consists of biotite granite residuum. Its thickness varies, usually thinner at
the mountain top and thicker at the slope and foot of the mount ain. It often mixes with more
Quaternary slope deposits. Its upper part often includes tens o f centimeters of humus. The layer,
typically about 1-2 meters thick, is mainly gray-brown to black -brown, composed of quartz sand,
weathered fragments of biotite granite, clay, and a small amount of biotite and feldspar. Its texture is
loose. Generally, this layer doesn't contain rare earth, or it has weak rare earth mineralization.
Completely weathered zone: This rare earth bearing mineral laye r is the main part of the ore body.
It is often flesh-red, light red, and gray white. It largely co nsists of kaolin, the weathering product of
feldspar, mica, and other minerals. A few minerals retain the structure of feldspar and can be easily
broken by hand. Rare residual detrital minerals such as quartz,  feldspar, and mica make up 1-3%.
Other weathered residual accessory minerals like ilmenite, mona zite, phosphoyttriite, and zircon
constitute less than 1%. Minerals such as sphenite, epidote, an d apatite are rare or very rare. The
thickness generally ranges from 2.0-15 meters, with an average thickness of 7 meters.
Semi-weathered zone: This layer is gray-white, with a granite structure, composed mainly of quartz,
feldspar, and biotite. It serves as the bottom of the rare earth layer. The weathering degree of rocks
in this layer is weak, with feldspar weathering decreasing and kaolinization common at the edge of
feldspar grains, about 30%. Feldspar crystals are relatively complete and generally not easy to crush.
This layer typically doesn't contain rare earth ore, or it has weak rare earth mineralization.
The ore body is formed by the weathering of medium-fine grained  biotite granite, which is the main
ore-forming rock and a product of later alteration, in which th e altered residues of medium-coarse
grained biotite granite can be seen, indicating that the ore-fo rming parent rock in this area has
– IIID-50 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Geological Setting and Mineralization   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 28
undergone at least two periods of magmatic alteration. The structure within the mining area is simple,
and the rock body (ore body) is held between faults extending f rom northwest to southeast, where
no folding structures are seen.
The favorable climate and geographical environment have led to the extensive development and
complete preservation of the weathering crust in the mining are a; through geological surveys and
drilling operations in the mining area, it was found that the rare earth mineralization is influenced by
factors such as lithology, uneven weathering, and topography, a nd the rock weathering intensity
varies in both vertical and horizontal directions, causing the rare earth ore (mineralization) to undulate
along the terrain. Ores rich in clay minerals have better grade s. In terms of individual micro-
geomorphological units, the grades are high at the tops and sid es of the mountains, and gradually
decrease to non-ore bodies towards the valleys and foot of the mountains. The ore (mineralization)
body is pseudo-layered, locally  lens-shaped, and the continuity  of mineralization is general. A
complete weathering crust is preserved from the surface soil layer, fully weathered layer, and semi-
weathered layer, with the fully weathered layer being the main ore-bearing layer. The thickness of
the regolith is between 10 and 32 metres from surface.
At Mengkham the top of the mineralised zone is defined by a thin surficial soil zone that averages 2
m in thickness. The base of the mineralised zone extends to an average vertical depth of 9.0 m. And
the SREO grade range from 9.5 to 2857 g/t, averaging 243.5 g/t.
Based on 30 holes composite assays, the typical SREO composition chart is presented in Figure 6-6.
The approximate range of SREO composition is as follows: praseo dymium-neodymium (PrNd)
oxides 25.5%, magnet rare earth oxides (“MREO”) 30.84%, and cri tical rare earth oxides (“CREO”)
account for 52.77% of the total SREO content (Table 6-2).
Figure 6-6: SREO Compositi on of Mengkham REE Project

Sources: SRK.
Table 6-2: Typical Content and Co mposition of the SREO for Mengkham REE Project
Item Content (g/t) %/SREO
SREO 400 100
Y2O3 106 26.39
La2O3 87 21.84
CeO2 19 4.70
Pr6O11 21 5.33
– IIID-51 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Geological Setting and Mineralization   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 29
Item Content (g/t) %/SREO
Nd2O3 81 20.16
Sm2O3 18 4.53
Eu2O3 3 0.87
Gd2O3 19 4.82
Tb4O7 3 0.76
Dy2O3 18 4.58
Ho2O3 4 0.90
Er2O3 10 2.44
Tm2O3 1 0.35
Yb2O3 8 2.01
Lu2O3 1 0.25
Notes:
1 MREO: Pr6O11+Nd2O3+Tb4O7+Dy2O3.
2 CREO: Nd2O3 + Eu2O3 + Tb4O7 + Dy2O3 + Y2O3，determined by US Department of Energy 2023.
3 SREO: Total Soluble Rare Earth Oxides include Y2O3+La2O3 + CeO2 + Pr6O11 + Nd2O3 + Sm2O3 + Eu2O3 + Gd2O3 + Tb4O7
+ Dy2O3 + Ho2O3 + Er2O3 + Tm2O3 + Yb2O3 + Lu2O3.
6.4 Deposit Types
Both Sepon REE Project and Mengkham REE Project are ion adsorption type of REE deposits, which
was developed over granite bodies by weathering the rock bodies and transferring and enriching the
REEs bearing in the minerals into clay minerals of the weathered zones by adsorption.
The REE-bearing regolith profile provides a vertical cross-sect ion of the soil layers created by
weathering and other breakdown processes. The soil profile is g enerally recognized to have three
fundamental layers: Horizons A, B, and C.
Horizon A, the uppermost layer, is typically composed of organi c matter, humus, and mineral
particles. Its thickness can vary based on factors such as vege tation cover and rainfall. This layer
can be further subdivided into smaller sub-layers, including Ah (humus-rich) and Ae (eluvial horizon
with leached minerals). Due to leaching and organic complexatio n (and occasionally chemical
reduction), Horizon A usually has low REE concentrations. These processes move REE ions deeper
into the soil profile.
Horizon B, the subsurface layer, is enriched with minerals leac hed from the overlying Horizon A. It
serves as the key zone for IAC REE accumulation due to:
 Adsorption onto clay minerals like kaolinite and halloysite, prevalent in Horizon B.
 Chemical conditions conducive to REE precipitation with specific minerals.
Horizon B, a layer essential for rare earth exploration and potential resource extraction, can be further
classified based on features such as color and clay content. Fa ctors like rock type, climate, and
weathering intensity affect the thickness and rare earth elements (REE) concentration within Horizon
B. Often referred to as the main REE-bearing layer within the project area, Horizon B typically occurs
approximately 2 to 10 metres below the topsoil and averages about eight metres in thickness.
Horizon C, the layer beneath Ho rizon B, represents the unweathe red or partially weathered parent
rock. It contains the original source of REE within the weathered regolith deposits.
The projects area are located in a tropical region with a warm and humid climate. The granite rock in
the area undergoes intense weathering due to favourable topogra phic conditions where erosion is
– IIID-52 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Geological Setting and Mineralization   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 30
less significant than weathering. This has led to the widespread formation of weathered layers, which
range from less than 1 metre to over 50 metres thick in some parts of the project area.
The distribution of the weathered  layer is typically irregular due to erosion from the river drainage
system. Depending on the extent of the weathered layer covering the mountainous terrain, it can be
classified into two types from the in-situ leaching perspective: full coverage and exposed base types.
Full-coverage type: This type refe rs to the complete coverage o f the entire mountain by the
weathered layer, where no bedrock is visible at the mountain ba se or in the gullies. Predominantly
observed in the low hills characterized by gentle, rolling topography, this type maintains each section
of the weathered layers well. Erosion along the mountain base l eads to a thinner weathered layer
compared to the hillside and mountain top.
Base-exposure type: This type includes the weathered layer covering most of the mountain base, as
well as the entire hillside and mountain top. In some parts of the mountain base, the bedrock is
exposed due to strong erosional processes. This type is mainly found in the low hills with a medium
rolling style.
Figure 6-7: Typical IAC- REEs Bearing Profile
Source: N Bustos, C Marquardt, A Belmar, P Cordeiro; Regolith-h osted rare earth exploration in the Chilean Coastal Range of th e Central
Andes
The Mengkham and Seop REE projects are primarily characterized by low hills and gentle,
undulating terrain. Influenced by a tropical climate, these areas have a relatively thick regolith cover.
According to the classification, the regolith layer developed w ithin most of the project area can be
categorized as the full-coverage type of IAC deposit.
– IIID-53 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Exploration, Sampling and Assaying   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 31
7 Exploration, Sampling and Assaying
SRK has not participated in the explorations conducted for both Mengkham and Speon projects. The
information regarding the explor ation is derived from the data provided by the client and through
discussions with geologists engaged in the fieldwork.
7.1 Exploration Programs
7.1.1 Sepon Rare Earth Element Deposit
During the geological mapping program in 2021, the anomalies of REE have been discovered in the
weathered crust of granite bodies in the Sepon project area. In November 2021, LXML drilled three
test shallow holes in the granite rock body in the south part of the Sepon project area and identified
cation REE enrichment in the weathered zone.  Further work defined three preliminary targets to look
for REE mineralized bodies in the granite rock bodies.
In the period from December 2021 to January 2022, first drilling program was conducted totalling 53
holes.  The program defined two advanced targets (Block01 and B lock02) in the No.1 preliminary
target. In February 2022, a dr illing program with 100 m by 100m  grid was conducted in the two
advanced targets, and then in-fill drilling was also conducted.   From May 2021, step out drilling
program with a grid of 200m by 100m was conducted in the area surrounding the advanced targets.
By July 2021, totally 607 holes with a meterage of 4,441m were completed in an area of about
9.1km2.  Totally 4,443 samples were taken for assaying.
Table 7-1 summarizes the work completed in the exploration of REE deposits.
Table 7-1: Programs Completed in Sepon Project
Working item Unit Quantity Remark
1/10000 Geological mapping km2 10
Drilling M 4440.8
Assaying Sample 4443
QAQC samples Sample 445
Cation phase analysis Sample 8
Specific gravity measures Sample 10
Hydrogeological survey km2 10
Geotechnical survey km2 10
Environmental survey km2 10
The locations of collars of dr illing holes were surveyed by usi ng 63csx GPS hand-held meter,
compass and topographic map.  The relative error of such survey  is 3-5m, which matches the
Chinese requirements of a general exploration program.
Shallow holes conducted in the exploration program were usually  drilled 8-11 m deep with almost
100% recovery and good quality.
7.1.2 Mengkham Rare Ear th Element Project
From January 2022 to June 2023, China Investment Mining (Laos) Sole Co., Ltd. carried out a
detailed exploration for Mengkham REE Project.
– IIID-54 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1894 ---
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Exploration, Sampling and Assaying   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 32
Table 7-2 summarizes the work completed in the exploration.
Table 7-2: Programs Completed in Mengkham REE Project
Working item Unit Quantity Remark
1/5000 Geological mapping km2 50
Drilling m 198,956.9
Assaying Sample 105,279
QAQC samples Sample 9,517
Bulk density measures Sample 10
1/10000 Hydrogeological survey km2 50
1/5000 Topo aero survey km2 2.3
The 1:5,000 topographic aerial survey was organized and implemented by Longyan Minde Surveying
and Mapping Co., Ltd., which has a Class A qualification in topographic surveying. The indoor work
was assisted by China Investment Mining company, and the field work started in December 2022,
with the results and data finished in early July 2023.
The locations of drilling holes were surveyed by using hand-held GPS.
Geological survey of 1:5,000 was carried out in the rare earth exploration area, basically finding out
the scale, shape, occurrence and ore-forming relationship of different periods and different lithology
intrusive rocks; basically finding out the distribution of the Quaternary and the river system in the
area; basically finding out the types of landforms, micro-geomo rphological features and types and
distribution of weathering crust in the work area, providing a reliable basis for the deployment of
manual impact sampling drilling and resource estimation.
7.1.3 SRK Comments
For the Mengkham REE project, t he 1:5,000 topographic aerial survey only covered an area of 2.3
km2. SRK suggests the mine to conduct a detailed topographic surve y covering the entire project
area.
7.2 Drilling Programs
For Sepon project, LXML Exploration Department conducted an exploration program from November
2021 to July 2022. A total of 607 boreholes (4,441 metres) were  drilled during the exploration on a
200-metre x 100-metre or 100-metre x 100-metre pattern, as shown in Figure 7-1.
Figure 7-1: Borehole Dist ribution of Sepon Project
Source: SRK
– IIID-55 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Exploration, Sampling and Assaying   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 33
For Mengkham REE Project, Longyan Dadi Mining Development Servi ce Co., Ltd conducted an
exploration program from January 2022 to December 2023. A total  of 13,656 boreholes (198,957
metres) were drilled during the exploration with a spacing of 30-100 m, as shown in Figure 7-2.
Figure 7-2: Borehole Distributi on of the Mengkham REE Project
Source: SRK
The design of the drilling grid f ollows the exploration princip le of ion-adsorption rare earth deposit
outlined in Chinese standard DZ/T 0204-2002: Geological Exploration Specifications of Rare Earth
deposit.
The manual GN auger was employed to delineate and identify econ omically viable zones in the
regolith. This auger is extensively used for exploring IAC rare earth deposits in China. Under optimal
operating conditions, it can reach a maximum drilling depth of 45 meters in the fully weathered
regolith horizon. This method provides a swift and cost-effecti ve drilling solution compared to other
techniques.
The specifications of the GN auger include a 95 cm diameter x 0 .5 m long auger bucket equipped
with 2 m drill rods. According to the drilling records, the aug er drilling achieved over 100% core
recovery during the programs.
– IIID-56 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Exploration, Sampling and Assaying   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 34
During the drilling, the retrieved core soil from each run was separately placed on plastic film,
labelled, recorded, and prepared for sampling.
After completion of a borehole, a wooden stick marked with the borehole ID (Figure 7-3), start and
end date, and end-hole-depth is placed at the drilling site to assist the surveyor in conducting the
collar survey.

Figure 7-3: The GN Auger Ut ilization and Hole Sealing
The core drilling and geological logging were carried out to a standard that ensures the data and
information collected sufficiently support the goals of subsequent geological modelling and resource
estimation.
SRK considers that the depth capacity of manual auger drilling may not be enough to penetrate
potentially semi-weathered hard layers or boulders. This limita tion could potentially result in
incomplete intersections of the ore-bearing horizon during drilling.
7.3 Sample Preparation, Analyses and Security
7.3.1 Sepon Rare Earth Element Deposit
Sample Collection
During the general exploration program, three types of samples were taken, i.e. basic assaying
samples, QAQC samples and specific samples.
– IIID-57 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1897 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Exploration, Sampling and Assaying   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 35
Sampling was conducted as, whole drilling core was taken as sam ple at 1m interval by using the
method of diagonal quarters to reduce the sample, with one half as the sample for assaying, and the
other half as the spare sample for storage.
The samples were all properly numbered, recorded before sent to labs.
Sample Preparation and Analyses
All basic assaying samples were prepared and assayed in the ALS  lab in Australia. The assaying
method is ME-MS81, which uses lithium borate to fuse, and then use acid to dissolve, and finally use
ICP-MS for assaying.  The method can achieve a precision of 0.1ppm.
Eight samples were sent to the testing centre of Guilin non-fer rous metallic mineral resources
Institute, China, for analysing REE compositions. The analytica l results show that the deposit
possesses mid-heavy REE, which is scarce.
Quality Assurance and Quality Control Program
Quality Control and Assurance (QA/QC) procedures were undertaken on an on-going basis to certify
that the assay results from the drilling programme would be con fidently relied upon. These
procedures included the insertion of QA/QC samples comprising standards or Certified Reference
Materials (CRMs), i.e., material containing known quantities of the element being assayed for; blanks
i.e., material that has been prepared known to contain trace material; and duplicates.
Bulk Density Test
In the general exploration report, 10 specific gravity samples were also taken from drilling cores and
were measured in the lab of the mine.
In SRK’s opinion, it was unable to collected density sample fro m GN Auger hole cores. A dry bulk
density of 1.5 t/m3 was used in resource estimation for Sepon project.
SRK Comments
The procedures for sample collection, preparation, and analysis  are following the REE industry
standards. SRK considers that the procedure, as well as the dat a and information obtained, are
acceptable for resource estimation purposes.
Going forward, the Sepon REE mine is considering in-situ leachi ng to be their main extraction
technique. However, the available data, which only includes 8 ionic analyses, falls short in providing
an accurate estimate of the mine's potential and productivity. The scant data does not paint a holistic
picture of what the mine can offer. For this reason, SRK sugges ts a re-analysis of the ionic REE
grade. Through this, we can have a clearer view of the mine's p otential, which is crucial in devising
and executing efficient mining plans.
– IIID-58 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Exploration, Sampling and Assaying   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 36
7.3.2 Mengkham REE Project
Sample Collection
Prior to conducting sample collection, an on-site quick test procedure was conducted to qualitatively
identify rare earth elements (“REE”) mineralized intervals. Onc e the quick test confirmed the
presence of mineralization in the retrieved core interval, the corresponding interval was collected for
further laboratory analysis.
The quick test employs ammonium sulphate to dissolve the REE io ns in the clay and using oxalic
acid to obtain the precipitate. The quick test utilizes ammonium sulphate to dissolve any potentially
present REE ions in the clay. The solution is then filtered through filter paper, and oxalic acid is added
to the filtrate in a test tube to see whether white precipitate is observed. If the solution remains clear,
it is deemed non-mineralized, and no sampling is conducted. Conversely, if a precipitate is observed,
the interval is sampled for further analysis.
The quick test employs ammonium sulphate to dissolve the rare e arth elements (“REE”) ions
potentially present in the clay. The process involves the following steps:
 Ammonium sulphate is used to dissolve any potentially present REE ions in the clay sample.
 The resulting solution is filtered through filter paper.
 Oxalic acid is added to the filtrate in a test tube, and.
 Check whether white precipitate is observed.
If the solution remains clear after the addition of oxalic acid, indicating the absence or trace amounts
of REE ions, the interval is deemed non-mineralized, and no sam pling is conducted. Conversely, if
a white precipitate is observed, indicating the presence of REE ions, the interval is sampled for further
laboratory analysis. Once the white precipitate is observed, all samples downwards from that depth
are collected for laboratory analysis.
Figure 7-4: The Quick REE Minera lization Distinguish on Mengkham Drilling Site

The samples are collected from the core of the GN Auger holes, and continuous samples are taken
according to different weathering layers. According to the Chin ese Rare Earth Mineral Geological
Exploration Standard (DZ/T0204-2022), the sample length is generally 1m, and cross-layer sampling
– IIID-59 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1899 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Exploration, Sampling and Assaying   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 37
is prohibited. If the different weathering layers are less than  1m, they are sampled separately. On
the site, the rock core within the same sample is first mixed evenly on a non-polluting sample cloth,
and then the diagonal method is used for subdivision, repeated several times until the sample
standard is met, and finally bagged and numbered and sent to th e laboratory in time. The sample
position, number, and sample length are clearly recorded on the  spot in time. Each sample has an
original weight of more than 1~1.5kg.
Sample Preparation and Analyses
All samples were prepared and analysed in the Mangkham mine laboratory.
The samples were split according to the formulation Q = Kd2, while K ranged from 0.2 to 0.5.
The original sample was not washed in any way to prevent the loss of useful, beneficial, and harmful
components. Before preparation, the sample was dried and weighe d. The balance should be
calibrated. The preparation utensils and equipment used before and after sample preparation should
be kept clean. It was strictly forbidden to mix in other substa nces. Effective measures should be
taken to ensure the quality of sam ple preparation. During the w hole preparation process, the total
loss rate of the sample should not exceed 5%, and the error of each splitting should not exceed 3%
of the original mass.
Figure 7-5: The Drying O ven on Mengkham Mine Site

The analyse method was EDTA (Ethylene Diamine Tetraacetic Acid) volumetric method as follows:
 Take 19.95-20.05g of the dry sample and put it into a long funn el, then place it on a triangular
flask, rinse it with 100ml-120ml of ammonium sulfate for more than three times, and wait until
there is no more liquid leaking from the bottom of the funnel, then take the volume of the leachate
and record it.
 Take 20ml of extract, add acetone, sulfonyl salicylate, dimethyl phenol orange, methyl tetramine,
titrate with calibrated EDTA until the solution changes from pu rple-red to bright yellow as the
endpoint, record the amount of EDTA used.
 Conduct two independent measurements and take their average value.
– IIID-60 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1900 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Exploration, Sampling and Assaying   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 38
Figure 7-6: The Mine Laboratory

The external laboratory check samples were analysed in Longyan Rare Earth Development Co., Ltd
and the composition of REE oxide samples were analysed in China Rare Earth Laboratory.
Quality Assurance and Quality Control Program
A total of 6,017 samples (about 6% of the samples used in Mineral Resource estimation) were
collected as internal lab check samples with a pass rate of 82%. And a total of 3,500 samples (about
4% of the samples used in Mineral Resource estimation) were collected as internal lab check
samples with a pass rate of 92%.
Bulk Density Test
A total of ten bulk density samples were implemented across the project areas with the natural bulk
density (wet basis) ranging from 1.7 to 1.81 t/m 3, averaging 1.75 t/m 3, dry bulk density ranging
between 1.35 and 1.55 t/m3, averaging 1.47 t/m3.
The average dry bulk density of 1.47 t/m 3 is determined to be used in resource estimation for the
entire project area.
SRK Comments
SRK considers that the onsite laboratory was poorly equipped, and no CRMs or blank samples were
used for quality control. It is recommended that all the sample s should be sent to a qualified
laboratory for assaying again.
There are merely 30 samples that possess REE compositions. This limited number prompts SRK to
recommend that the mine should increase its efforts in conducting more composition analyses. This
is to ensure a more reliable and expansive dataset for evaluation purposes.
The mine's current approach is to analyse all basic samples in the lab onsite. While this might be
convenient and efficient, it may not provide the most accurate results. Therefore, to enhance the
– IIID-61 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1901 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Exploration, Sampling and Assaying   Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 39
validity of the results, SRK recommend collecting a substantial  portion, specifically 30%, of the
samples for further validation at an external lab. This will provide a more robust cross-checking
mechanism and thus, ensuring a higher level of accuracy in the analysis results.
SRK also considers that the rapid test method, which entails visually observing rare earth precipitates
before conducting core sampling for laboratory analysis, is qua litative in nature. This approach
serves merely as an initial indication to assess the mineraliza tion within the sampled core interval.
Due to its inherent subjectivity , this method may result in ove rlooking certain shallow-occurring
intervals containing REE sufficient for subsequent laboratory t esting, potentially leading to an
underestimation of REE mineralization thickness.



– IIID-62 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1902 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Data Verification    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 40
8 Data Verification
8.1 Sepon Rare Earth Element Deposit
8.1.1 Verifications by the Client
SRK has checked samples results provided by the Client, including 11 CRMs, 393 blank samples
and 29 field duplicate samples.
Table 8-1: QAQC Sample S ummary for Sepon Project
Zone Category QC samples Total N of samples %Coverage
Sepon
CRMs 11
4443
0.25%
Coarse Blanks 327 7.36%
Pulp Blanks 66 1.49%
Field Duplicates 29 0.65%
CRMs
Sepon supplied only one CRM, namely Ox-P1L, as detailed in Table 8-2.
Table 8-2: CRM Summary for Sepon Project
Count Minimum Maximum Range Mean SD
11 109.02 116.38 7.36 111.65 2.51
Blanks
Coarse and pulp blanks were used. As shown in Figure 8-1 and Figure 8-2, all samples are less than
170 TREO g/t, the cut-off grade of Mineral Resource.
Figure 8-1: Coarse Blan ks for Sepon Project

– IIID-63 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1903 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Data Verification    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 41

Figure 8-2: Pulp Blan ks for Sepon Project

Filed Duplicates
All duplicate pairs are within 20% limits, as shown in Table 8-3 and Figure 8-3.
Table 8-3: Field Duplicates Summary for Sepon Project
Element Data Pairs Count Relative Difference
<10% 10% - 20% > 20%
Pr 29 26 90% 3 10% - 0%
Nd 29 25 86% 4 14% - 0%
Tb 29 26 90% 3 10% - 0%
Dy 29 25 86% 4 14% - 0%
Lu 29 23 79% 6 21% - 0%

– IIID-64 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1904 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Data Verification    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 42
Figure 8-3: Field Duplicates for Sepon Project
– IIID-65 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1905 ---
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Data Verification    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 43

8.1.2 SRK Comments
SRK is of opinion that the exploration data has been validated and is appropriate for a mineral
resource estimate.
8.2 Mengkham REE Project
8.2.1 Verifications by the Client
SRK was provided with 6,017 pairs of samples for internal lab c heck and 3,500 pair of samples for
external lab check. As shown in Table 8-4 and Figure 8-4, the above 20% relative differences are
18% for internal and 8% for external. The exploration data was appropriate for the mineral resource
estimate.
Table 8-4: QAQC Sample Summary for Mengkham REE Project
Category Element
Data
Pairs
Count
Percentage
of Assays
Relative Difference
<10% 10% - 20% > 20%
Internal SREO 6,017 6% 2,723 45% 2,196 36% 1,098 18%
External SREO 3,500 4% 2,191 63% 1,028 29% 281 8%
– IIID-66 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1906 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Data Verification    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 44
Figure 8-4: Duplicates of Mengkham REE Project
8.2.2 Verifications by SRK
During the period from 13 to 16 May 2024, SRK conducted a site visit to the Mengkham REE project
and collected 169 core duplicate samples from 13 boreholes, det ailed in Table 8-5. The samples
were sent to SGS Mineral Laboratory located in Tianjin, China for verification assay.
Table 8-5: Summary of SRK Ve rification Borehole Samples
Hole Easting Northing Depth Duplicate Samples
KT8-35 360932 2193253 10 10
KT8-27-2 360971 2193207 14 14
YZ33 360933 2195189 25 25
YZ02-1 361589 2189949 25 25
KT7-121 360673 2192876 12 12
KT6-103-1 360049 2193819 10 10
KT3-16 359369 2193759 13 13
KT6-82 359948 2194108 9 9
KT7-7 360038 2192800 13 13
ZKF16-179 360945 2196321 14 12
ZK17-115 360391 2193631 18 10
ZKF18-104 360308 2196387 14 7
ZKF29-140 361003 2194583 11 9
The results were shown in Table 8-6 and Figure 8-5, large bias was observed between original
assay and verification results. About 32% results for SREO are within ±20%. About 68% results are
out of ±20%. SRK has checked with both onsite laboratory and SGS staff, found that the sample
preparation and assaying method were different. The samples were crushed to 75 µm (200 mesh)
in SGS and the assaying method was ICP-MS. And in onsite laboratory, the samples were crushed
to 1 mm and the assaying method was EDTA. SRK has downgraded Indicated Mineral Resources
to Inferred Mineral Resource.

– IIID-67 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1907 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Data Verification    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 45
Table 8-6: SRK Verifi cation Samples Summary for Mengkham Project
Element Data Pairs
Count
Relative Difference
<10% 10% - 20% > 20%
SREO 169 30 18% 24 14% 115 68%
Figure 8-5: SRK Verification Dup licates of Mengkham REE Project
8.2.3 SRK Comments
Large bias was observed between original assay and SRK verifica tion results. It is recommended
that all the samples should be sent to a qualified laboratory for re-assaying.
– IIID-68 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1908 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Mineral Processing and Metallurgical Testing    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 46
9 Mineral Processing and Metallurgical Testing
This section is only prepared for the Mengkham REE project.
9.1 Ore Properties
The Mengkham ore belongs to the ion-adsorbed type rare earth or e, and the rare earth elements
(“REE”) are adsorbed in the clay minerals in the granite weathering crust, with average SREO content
of 0.025%.
The minerals are mainly quartz, feldspar, biotite, ilmenite, ma gnetite, followed by zircon, apatite,
xenotime, fluorite, sphene minerals and so on. The main impurities are Al2O3 with an average content
of 57.47%, CaO with an average content of 26.38% and SiO2 with an average content of 5.80%.
9.2 Metallurgical Test
The Client conducted a simple laboratory column leaching test on a composite sample collected from
#2 ore body in March 2024. The SREO content of the test sample was 0.0245%. The test uses
ammonium sulphate as RE leaching reagent, mainly includes ammon ium sulphate dosage test, pH
value condition test and permeability test. The photos of test process are shown in Figure 9-1 and
the test results are as follows:
 The permeability coefficient of the RE samples is 0.89x10-3～1.11x10-3cm /s.
 With the consumption of ammonium sulphate of over 12 t/t REO and the pH value of 4.5, the
peak REO concentration of the pregnant leaching solution (“PLS” ) can reach over 2.0 g/L,
and the SREO leaching rate can reach 94% along with the leaching time of 120 hours.
The results indicate the ore is easy to leach, and the In-situ Leaching method is probably applicable.
SRK noted that the test report is relatively simple and can onl y be used as a basic reference for in-
situ leaching of #2 ore body. Due to the differences in ROM pro perties and grades of different ore
bodies, SRK recommends that ore samples should be taken from each ore body representatively to
carry out test studies before production, and the following experimental contents should be added:
 SREO content analysis of RE ore samples, and
 PLS purification and precipitati on tests to determine the purif ication and precipitation
conditions and reagents consumption.
Figure 9-1: Laboratory Leaching Test

– IIID-69 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 47
10 Mineral Resource Estimates
10.1 Sepon Rare Earth Element Deposit
10.1.1 Introduction
The Mineral Resource Statement presented herein represents the first mineral resource evaluation
prepared for the Sepon REE project in accordance with the JORC Code 2012.
The mineral resource model prepared by SRK considers the core b oreholes drilled by the client
during the period of November 2021 to July 2022. The effective date of the Mineral Resource
Statement is 30 September 2024.
This section describes the methodology, procedure and key assum ptions applied in Resource
estimation. In the opinion of SRK, the resource estimation repo rted herein is a reasonable
representation of the global rare earths resource found in the Sepon IAC REE Project at the current
level of sampling. The mineral resources are reported in accord ance with the JORC Code 2012.
Mineral resources are not Ore Reserves and have not demonstrated economic viability. There is no
certainty that all or any part of the mineral resource will be converted into Ore Reserve.
The database used to estimate the Project mineral resources was  audited by SRK. SRK is of the
opinion that the current drilling in formation is sufficiently r eliable to interpret with confidence the
boundaries for rare earths mineralization and that the assay da ta are sufficiently reliable to support
mineral resource estimation.
The Leapfrog Geo and Edge (Version 2023.2) software was used to  create both geological model
and block model for the Project. The software is considered as a proper modelling tool for this regolith
type of deposit.
10.1.2 Resource Estimation Procedures
The resource evaluation methodology involved the following procedures:
 Database compilation and verification
 Construction of wireframe models for the boundaries of the REE mineralization
 Definition of resource domains
 Data conditioning (compositing and capping) for analysis
 Block modelling and grade interpolation
 Resource classification and validation
 Assessment of “reasonable prospec ts for eventual economic extra ction” and selection of
appropriate cut-off grades
 Preparation of the Mineral Resource Statement
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10.1.3 Resource Database
The datasets and information used in the models were provided b y the client, including geological
exploration reports and associated maps and tables, topographic  data, geological maps, borehole
databases, etc. The coordinate sy stem applied for the entire pr oject is the UTM projection (Zone
48N) using the Indian 1960 Datum.
Prior to conducting Mineral Re source modelling, SRK performed a  data validation procedure to
assess the reliability of the received datasets.
Digital terrain models ("DTM") were created from AutoCAD contour maps provided by the client.
These contour maps were derived from the site survey activity. SRK considers that the created DTMs
are acceptable to be used in the mineral resource estimation.
The summary statistics of the holes (Table 10-1) used in Minera l Resource estimation is listed in
Table 10-5.
Table 10-1: Drillhole Statistics used for the Resource Estimation
Drillhole Type Drillholes Length（（m）） Samples Year
GN Auger 591 4,296 4,298 2021-2022
10.1.4 Solid Body Modelling
Solid models were created in Leapfrog Geo software based on the  following considerations,
principles, and steps.
The deposit type in the Sepon project is an ion-adsorption type  hosted in weathered regolith. The
development level of the weathered regolith layer largely shape d the distribution and geometry of
the REE mineralization. The ore-bearing layers are mainly prese nt in the middle part of the fully
weathered regolith profile and the upper part of the semi-weathered layer.
The REE mineralized bodies generally exhibit a stratiform appea rance, with their morphology
controlled by the occurrence of the weathered regolith. In relatively flat mountaintop areas, the bodies
tend to be thicker and have a more pronounced sheet-like shape.  Whereas in steep hillside and
valley areas, the bodies tend to have a thinner and more complex shape due to erosion and
transportation effects.
In Leapfrog software, SRK created a geological model based on t he drillhole assay data and
employed an implicit modeling approach.
The distribution maps of mineralized bodies were illustrated in Figure 10-1.

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10.1.5 Bulk Density Test
In the general exploration report, 10 specific gravity samples were also taken from drilling cores and
were measured in the lab of the mine.
In SRK’s opinion, it was unable to collected density sample fro m GN Auger hole cores. A dry bulk
density of 1.5 t/m3 was used in resource estimation for Sepon project.
10.1.6 Compositing
Prior to conducting the statistical analysis, the samples were combined so the length of each sample
was basically equivalent. The distribution of sample length is provided in Figure 10-2. The database
indicates that most of the sample intervals are 1 m.
All data from the database containing the flagged raw sample in tervals were composited to 1.0 m
downhole lengths, with a minimum length of 0.5 m required to create a composite. SRK applied 1.0 m
composite for all subsequent analyses and grade interpolations.
Figure 10-1: Plan View (Up) and Se ction View (Down) of Sepon Mineralized Bodies
Source:SRK
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Mineral Resource Estimates    Final
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The sampling methods in the Sepon Project are essentially consistent, and the approach to handling
composite samples is also the same.
10.1.7 Evaluati on of Outliers
To identify the appropriate top cuts for every mineralised oreb ody, the cumulative frequency and
distribution characteristics of the sample histogram, as shown in from Figure 10-3 to Figure 10-16
were used, in addition, the coefficient of variation statistic and 3D visualisations were also considered.
The cutoff grades for each rare earth oxides used in estimation listed in Table 10-2.

Figure 10-2: Histogram of Sample Length
Source:SRK
Figure 10-3: Y2O3 Histogram and Cumulative Histogram of the Mineralized Domain

Source:SRK
Note:
1 The mean is indicated by the red diamond.
2 The median is indicated by the line that crosses the inside of the box.
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Figure 10-4:  La2O3 Histogram and Cumulative Histogram of the Mineralized Domain
Source:SRK
Note:
1 The mean is indicated by the red diamond.
2 The median is indicated by the line that crosses the inside of the box.
Figure 10-5: CeO2 Histogram and Cumulative Histogram of the Mineralized Domain

Source:SRK
Note:
1 The mean is indicated by the red diamond.
2 The median is indicated by the line that crosses the inside of the box.
– IIID-74 –
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Mineral Resource Estimates    Final
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Figure 10-6: Pr6O11 Histogram and Cumulative Histogram of the Mineralized Domain
Source:SRK
Note:
1 The mean is indicated by the red diamond.
2 The median is indicated by the line that crosses the inside of the box.
Figure 10-7: Nd2O3 Histogram and Cumulative Histogram of the Mineralized Domain
Source:SRK
Note:
1 The mean is indicated by the red diamond.
2 The median is indicated by the line that crosses the inside of the box.
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Figure 10-8: Sm2O3 Histogram and Cumulative Histogram of the Mineralized Domain
Source:SRK
Note:
1 The mean is indicated by the red diamond.
2 The median is indicated by the line that crosses the inside of the box.
Figure 10-9: Gd2O3 Histogram and Cumulative Histogram of the Mineralized Domain
Source:SRK
Note:
1 The mean is indicated by the red diamond.
2 The median is indicated by the line that crosses the inside of the box.
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Figure 10-10: Tb4O7 Histogram and Cumulative Histogram of the Mineralized Domain
Source:SRK
Note:
1 The mean is indicated by the red diamond.
2 The median is indicated by the line that crosses the inside of the box.
Figure 10-11: Dy2O3 Histogram and Cumulative Histogram of the Mineralized Domain
Source:SRK
Note:
1 The mean is indicated by the red diamond.
2 The median is indicated by the line that crosses the inside of the box.
– IIID-77 –
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Figure 10-12: Ho2O3 Histogram and Cumulative Histogram of the Mineralized Domain
Source:SRK
Note:
1 The mean is indicated by the red diamond.
2 The median is indicated by the line that crosses the inside of the box.
Figure 10-13: Er2O3 Histogram and Cumulative Histogram of the Mineralized Domain
Source:SRK
Note:
1 The mean is indicated by the red diamond.
2 The median is indicated by the line that crosses the inside of the box.
– IIID-78 –
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Figure 10-14: Tm2O3 Histogram and Cumulative Histogram of the Mineralized Domain

Source:SRK
Note:
1 The mean is indicated by the red diamond.
2 The median is indicated by the line that crosses the inside of the box.
Figure 10-15: Yb2O3 Histogram and Cumulative Histogram of the Mineralized Domain

Source:SRK
Note:
1 The mean is indicated by the red diamond.
2 The median is indicated by the line that crosses the inside of the box.
– IIID-79 –
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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 57
Table 10-2: Outlier Value for Sepon Project
TREO Assay Cap Capped Samples Capped Ratio (%) Mean (%)
(g/t) Before Capping After Capping
Y2O3 175 42 0.98 55.39 54.96
La2O3 250 24 0.56 78.99 78.65
CeO2 300 30 0.70 120.51 120.25
Pr6O11 45 40 0.93 16.05 15.95
Nd2O3 160 33 0.77 54.82 54.55
Sm2O3 32 28 0.65 10.21 10.16
Eu2O3 10 19 0.44 2.44 2.43
Gd2O3 28 50 1.17 9.26 9.19
Tb4O7 5 28 0.65 1.47 1.47
Dy2O3 30 27 0.63 8.68 8.64
Ho2O3 6 32 0.75 1.77 1.77
Er2O3 18 22 0.51 5.17 5.15
Tm2O3 2 66 1.54 0.75 0.75
Yb2O3 15 27 0.63 4.87 4.85
Lu2O3 2.5 15 0.35 0.75 0.75
10.1.8 Block Model and Grade Estimation
SRK generated non-rotational model via Leapfrog software for gr ade and tonnage estimation. A
suitable block interval and unit size was adopted to build a bl ock model which was able to contain
the mineralized zones. The bock size was set to 10 m × 10 m × 2  m (East × North × Elevation). A
summary of the block model specifications is presented in Table 10-3.
Table 10-3: Block Model Parameters
  Base Point Boundary Block Size Sub Block Size Rotation
E 630,487.98 7,020 10 10 0
N 1,857,207.27 2,630 10 10 0
Z 560.00 544 2 2 0
The estimation method for SREO was Inverse Distance Weighting ( “IDW”). The model underwent
three searches.  The specific search parameters are detailed in Table 10-4.
Figure 10-16: Lu2O3 Histogram and Cumulative Histogram of the Mineralized Domain
Source:SRK
Note:
1 The mean is indicated by the red diamond.
2 The median is indicated by the line that crosses the inside of the box.
– IIID-80 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 58
Table 10-4: Search Ellipsoid Parameters
Element Runs
Search
Distance
(m)
Minimum Samples Maximum
Samples
Maximum samples
in a single drillhole
15 Rare Earth Oxide
1 110 6 24 2
2 220 6 24 2
3 220 2 24 2
10.1.9 Model Validati on and Sensitivity
Swath plots are an important validation tool for providing comparisons between sample points and
estimated values to identify any bias towards under-estimation or over-estimation or any smoothing
in the results. The effect of different estimation methods and parameters can also be compared.
The swath plot is a one-dimensional graph in a specific directi on of interest. A swath is a sectional
slice through the block model wit h a specified thickness. The s wath plot shows the average grade
for the blocks in the swath, along with the averaged sample values in the swath.
Swath plots have been generated in three orthogonal (north, east, and vertical) directions at a certain
distance for Pr6O11 and Nd2O3 grade by SRK, as shown in Figure 10-17 and Figure 10-18. The block
models and the composites correspond well in all orthogonal dir ections. This comparison shows
close consistency between the blocks and composites in terms of overall distribution as a function of
X, Y, and Z coordinates.
Figure 10-17: Pr6O11 Grade Swath Plot for Sepon Project
– IIID-81 –
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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 59


Source:SRK
Figure 10-18: Nd2O3 Grade Swath Plot for Sepon Project

Source:SRK
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10.1.10 Mineral Resour ce Classification
Block model quantities and grade estimates for the Sepon projec t were classified according to the
JORC Code 2012.
Mineral resource classification is typically a subjective concept. Industry best practices suggest that
resource classification should consider the confidence in the geological continuity of the mineralized
structures, the quality and quantit y of exploration data supporting the estimates, and the
geostatistical confidence in the tonnage and grade estimates. A ppropriate classification criteria
should aim at integrating these concepts to delineate regular areas at similar resource classification.
SRK is satisfied that the geological modelling honours the curr ent geological information and
knowledge. The location of the samples and the assay data are s ufficiently reliable to support
resource evaluation. The sampling information was acquired primarily by GN Auger holes drilling on
spaced at 100-200 metres. As such the Mineral Resource is class ified based on the following
principles:
 Indicated Mineral Resource: the areas less than 100 m spacing of the drillholes.
 Inferred Mineral Resource: the areas greater than 100 m and les s than 200 m spacing of the
drillholes.
Typical Mineral Resource classification maps are presented in Figure 10-19.
Figure 10-19: Sepon Project Mineral Resource Classification

Source:SRK
10.1.11 Mineral Resource Statement
The JORC Code 2012 defines a mineral resource as:
“a concentration or occurrence of material of solid material of economic interest in or on the Earth’s
crust in such form, grade (or quality) and quantity that there are reasonable prospects for eventual
economic extraction. The locat ion, quantity, grade (or quality) , continuity and other geological
characteristics of a Mineral Resource are known, estimated or i nterpreted from specific geological
– IIID-83 –
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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 61
evidence and knowledge, including sampling. Mineral Resources a re sub-divided, in order of
increasing geological confidence, into Inferred, Indicated and Measured categories.”
The “reasonable prospects for eventual economic extraction” requirement generally implies that the
quantity and grade estimates meet certain economic thresholds a nd that the mineral resources are
reported at an appropriate cut-off grade that takes into account extraction scenarios and processing
recoveries.
In contrast to conventional mining method, the in-situ leaching  operation and wet plant cannot be
treated as separate business units as the output PLS produced from the leaching process is directly
fed into a wet plant for processing and the processed solution from the PLS is then recycled for
leaching utilization. Therefore,  this RPEEE assessment consider s the technical and cost factors
associated with both the leaching process and the wet plant.
SRK considers that the blocks with the TREO grade greater than 170 g/t show “reasonable prospects
for economic extraction” and can be reported as a Mineral Resource.
As of 30 September 2024, by applying a cut-off grade of 170 g/t TREO, The Mineral Resources which
SRK estimated and reported are as follows:
 26.78 Mt of Indicated Mineral Resource with an average grade of  383.75 g/t TREO, equivalent
to 10.28 kt of total rare earth oxides within the Project area.
 63.79 Mt Inferred Mineral Resourc e with an average grade of 339 .22 g/t TREO, equivalent to
21.64 kt of total rare earth oxides within the Project area.
Table 10-5: Mineral Resource Statement 1 of Sepon REE Project, as of 30 September 2024
Category Mass (Mt) TREO (g/t) TREO (kt) PrNd Oxides (%) MREO(%) C REO(%)
Indicated 26.78  383.75 10.28 19.14 21.97 33.87
Inferred 63.79  339.22 21.64 18.78 21.45 32.59
Notes:
1 Mineral Resources are not Ore Reserves and have not demonstrate d economic viability. All figures are rounded to reflect
the relative accuracy of the estimate. All composites have been capped where appropriate.
2 The information in this report which relates to Mineral Resource is based on information co mpiled by Mr. Huaixiang Li and
Dr. Anson Xu who are full time employees of SRK Consulting China Ltd. Mr. Huaixiang Li is a Member of AIG and Dr. Anson
Xu is a Fellow of AusIMM. Dr. Xu have sufficient experience whi ch is relevant to the style of mineralisation and the type of
deposits under consideration and to the activity which they are undertaking to qualify as the Competent Persons as defined
in JORC (2012).  Mr. Li and Dr. Xu consent to the reporting of this information in the form and context in which it appears.
3 Mineral Resources are reported at a cut-off grade of 170 g/t TR EO. Cut-off grades are based on a price of 239,000 RMB/t
REO.
4 MREO: Pr6O11+Nd2O3+Tb4O7+Dy2O3.
5 CREO: Nd2O3 + Eu2O3 + Tb4O7 + Dy2O3 + Y2O3,determined by US Department of Energy 2023.
6 TREO: Total Rare Earth Oxides include Y2O3+ La2O3 + CeO2 + Pr6O11 + Nd2O3 + Sm2O3 + Eu2O3 + Gd2O3 + Tb4O7 + Dy2O3
+ Ho2O3 + Er2O3 + Tm2O3 + Yb2O3 + Lu2O3.
10.1.12 Grade Sensitivity Analysis
The Mineral Resources of the Sepon project are sensitive to the  selection of the reporting cut-off
grade. To illustrate this sensitivity, the global model quantities and grade estimates are presented in
Figure 10-20 at various cut-off grades. The reader is cautioned that the figures presented in this table
should not be misconstrued with a Mineral Resource Statement. The figures are only presented to
show the sensitivity of the block model estimates to the selection of cut-off grade.
– IIID-84 –
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PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 62
Figure 10-20: Sepon Project Grade Tonnage Curve

Source:SRK
Notes:
1 The reader is cautioned that the  figures should not be misconst rued with a Mineral Resource Statement. The figures are
only presented to show the sensitivity of the block model estimates to the selection of a cut-off grade.
10.2 Mengkham REE Project
10.2.1 Introduction
The Mineral Resource Statement presented herein represents the first mineral resource evaluation
prepared for the Mengkham REE project in accordance with the JORC Code 2012.
The mineral resource model prepared by SRK considers the core b oreholes drilled by the client
during the period of January 2022 to December 2023. The effecti ve date of the Mineral Resource
Statement is 30 September 2024.
This section describes the methodology, procedure and key assum ptions applied in Resource
estimation. In the opinion of SRK, the resource estimation repo rted herein is a reasonable
representation of the global rare earths resource found in the Mengkham IAC REE Project at the
current level of sampling. The mineral resources have been estimated in accordance with the JORC
Code 2012. Mineral resources are not Ore Reserves and have not demonstrated economic viability.
There is no certainty that all or any part of the mineral resource will be converted into Ore Reserve.
The database used to estimate the Project mineral resources was  audited by SRK. SRK is of the
opinion that the current drilling in formation is sufficiently r eliable to interpret with confidence the
boundaries for rare earths mineralization and that the assay da ta are sufficiently reliable to support
mineral resource estimation.
– IIID-85 –
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PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Mineral Resource Estimates    Final
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The Leapfrog Geo and Edge (Version 2023.2) software was used to  create both geological model
and block model for the Project. The software is considered as a proper modelling tool for this regolith
type of deposit.
10.2.2 Resource Estimation Procedures
The resource evaluation methodology involved the following procedures:
 Database compilation and verification
 Construction of wireframe models for the boundaries of the REE mineralization
 Definition of resource domains
 Data conditioning (compositing and capping) for analysis
 Block modelling and grade interpolation
 Resource classification and validation
 Assessment of “reasonable prospec ts for eventual economic extra ction” and selection of
appropriate cut-off grades
 Preparation of the Mineral Resource Statement
10.2.3 Resource Database
The datasets and information used in the models were provided b y the client, including geological
exploration reports and associated maps and tables, topographic data (only covering an area of 2.3
km2), geological maps, borehole databases, etc. The coordinate system applied for the entire project
is the UTM projection (Zone 48N) using the WGS84 Datum.
Prior to conducting Mineral Re source modelling, SRK performed a  data validation procedure to
assess the reliability of the received datasets. 736 holes with  15,067 assays were excluded due to
the reasons of wrong coordinates , duplicate assay at the same interval or extremely high SREO
grade (from 0.4% to 2.68%).
Digital terrain models ("DTM") of an area of 2.3 km 2 were created from AutoCAD contour maps
provided by the client, as shown in Figure 10-21. These contour  maps were derived from the site
survey activity. SRK considers that the created DTMs are acceptable to use in the mineral resource
estimation. The rest area of the project’s DTM was created usin g the Copernicus data downloaded
by SRK.
– IIID-86 –
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Figure 10-21: Topo Survey Area of Mengkham REE Projects

Source:SRK
The summary statistics of the holes (Figure 7-2) used in Minera l Resource estimation is listed in
Table 10-6.
Table 10-6: Drillhole Statistics used for the Resource Estimation
Drillhole Type Drillholes Length（（m）） Samples Year
GN Auger 13,251 192,008 92,935 2022-2023
10.2.4 Solid Body Modelling
Solid models were created in Leapfrog Geo software based on the  following considerations,
principles, and steps.
The deposit type in the Mengkham REE Project is an ion-adsorpti on type hosted in weathered
regolith. The development level o f the weathered regolith layer largely shaped the distribution and
geometry of the REE mineralization. The ore-bearing layers are mainly present in the middle part of
the fully weathered regolith profile and the upper part of the semi-weathered layer.
– IIID-87 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1927 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 65
The REE mineralized bodies generally exhibit a stratiform appea rance, with their morphology
controlled by the occurrence of the weathered regolith. In relatively flat mountaintop areas, the bodies
tend to be thicker and have a more pronounced sheet-like shape.  Whereas in steep hillside and
valley areas, the bodies tend to have a thinner and more complex shape due to erosion and
transportation effects.
Based on the above considerations, a terrain analysis was condu cted to identify steep areas
(typically slopes greater than 40 degrees) and valley areas wit h creeks or rivers. Through cross-
checking with drillhole assay data , areas were identified as un likely to retain weathered regolith or
host mineralization of insufficient thickness to be economicall y viable. Subsequently, these areas
were excluded from the delineation of mineralized boundaries.
Due to the REE quick test before sampling, SRK considers all the intervals with REE grades as the
mineralized zone and above the mineralized zone is the topsoil zone. In Leapfrog software, SRK
created a geological model based on the drillhole assay data an d employed an implicit modeling
approach. Additionally, constraints on the mineralized zones are applied using data related to valleys
and water systems.
The distribution maps of mineralized orebodies were illustrated from Figure 10-22.
Figure 10-22: Plan View (Up) and Section View (Down) of Mengkham Mineralized Bodies
– IIID-88 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1928 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 66
10.2.5 Bulk Density Test
A total of ten bulk density samples were implemented across the project areas with the natural bulk
density (wet basis) ranging from 1.7 to 1.81 t/m 3, averaging 1.75 t/m 3, dry bulk density ranging
between 1.35 and 1.55 t/m3, averaging 1.47 t/m3.
The average dry bulk density of 1.47 t/m 3 is determined to use in resource estimation for the entire
project area.
10.2.6 Compositing
Prior to conducting the statistical analysis, the samples were combined so the length of each sample
was basically equivalent. The distribution of sample length is provided in Figure 10-23. The database
indicates that most of the sample intervals are 1 m.
All data from the database containing the flagged raw sample in tervals were composited to 1.0 m
downhole lengths, with a minimum length of 0.5 m required to create a composite. SRK applied 1.0 m
composite for all subsequent analyses and grade interpolations.

Source:SRK
Figure 10-23: Histogram of Sample Length
Source:SRK
– IIID-89 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1929 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 67
The sampling methods in the Mengkham REE Project are essentiall y consistent, and the approach
to handling composite samples is also the same, as shown in Figure 10-24.
10.2.7 Evaluati on of Outliers
Due to the specific nature of the drilling method, over 99% of the sample lengths are 1.0 meter.
Therefore, the original data statistics and composite data statistics for samples within the orebodies
show almost identical results, listed in Table 10-7.
Table 10-7: Raw and Composite Sa mple Statistics within Mineralized Domain
Items Raw Composite
Count 82,895 82,926
Mean 0.0245 0.0245
Length 82,896.3 82,925.3
Std 0.02 0.02
CV 0.81 0.80
Variance 0.0004 0.0004
Minimum Value 0.001 0.001
Q1 0.014 0.014
Q2 0.018 0.018
Q3 0.026 0.027
Maximum Value 0.286 0.264
To identify the appropriate top cuts for the mineralised body, the cumulative frequency and
distribution characteristics of the sample histogram, as shown in Figure 10-25 were used, in addition,
the coefficient of variation statistic and 3D visualisations we re also considered. After reaching a
SREO grade of 0.105%, the continuity of samples becomes sparse.  The cutoff grades used in
estimation listed in Table 10-8.
Figure 10-24: SREO Grade Before and After Compositing

Source:SRK
– IIID-90 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1930 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 68
Table 10-8: Outlier Value for Mengkham REE Project
Assay Cap  Capped Samples Capped Ratio (%) SREO Mean (%)
SREO (%) Before Capping After Capping
0.105 794 0.96 0.0245 0.0243
10.2.8 Block Model and Grade Estimation
SRK generated non-rotational model via Leapfrog software for gr ade and tonnage estimation. A
suitable block interval and unit size was adopted to build a bl ock model which was able to contain
the mineralized zones. The bock size was set to 10 m × 10 m × 4  m (East × North × Elevation). A
summary of the block model specifications is presented in Table 10-9.
Table 10-9: Block Model Parameters
  Base Point Boundary Block Size Sub Block Size Rotation
E 357,495.35 7,060 10 5 0
N 2,186,283.81 12,290 10 5 0
Z 1,800.00 612 4 2 0
The estimation method for SREO was Inverse Distance Weighting ( “IDW”). The model underwent
three searches.  The specific search parameters are detailed in Table 10-10.
Table 10-10: Search Ellipsoid Parameters
Element Runs Search Distance
（（m））
Minimum
Samples
Maximum
Samples
Maximum samples
in a single
drillhole
SREO
1 60 6 24 2
2 120 6 24 2
3 120 2 24 2
Figure 10-25: Histogram and Cumulative Histogram of the Mineralized Domain
Source:SRK
Note:
1 The mean is indicated by the red diamond.
2 The median is indicated by the line that crosses the inside of the box.
– IIID-91 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1931 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 69
10.2.9 Model Validati on and Sensitivity
Swath plots are an important validation tool for providing comparisons between sample points and
estimated values to identify any bias towards under-estimation or over-estimation or any smoothing
in the results. The effect of different estimation methods and parameters can also be compared.
The swath plot is a one-dimensional graph in a specific directi on of interest. A swath is a sectional
slice through the block model wit h a specified thickness. The s wath plot shows the average grade
for the blocks in the swath, along with the averaged sample values in the swath.
Swath plots have been generated in three orthogonal (north, east, and vertical) directions at a certain
distance for SREO grade by SRK, as shown in Figure 10-26. The block models and the composites
correspond well in all orthogonal directions. This comparison shows close consistency between the
blocks and composites in terms of overall distribution as a function of X, Y, and Z coordinates.
Figure 10-26: SREO Grade Swath Plot for Mengkham REE Project

Source:SRK
– IIID-92 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1932 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 70
10.2.10 Mineral Resour ce Classification
Block model quantities and grade estimates for the Mengkham REE  Project were classified
according to the JORC Code 2012.
Mineral resource classification is typically a subjective concept. Industry best practices suggest that
resource classification should consider the confidence in the geological continuity of the mineralized
structures, the quality and quantit y of exploration data supporting the estimates, and the
geostatistical confidence in the tonnage and grade estimates. A ppropriate classification criteria
should aim at integrating these concepts to delineate regular areas at similar resource classification.
SRK is satisfied that the geological modelling honours the curr ent geological information and
knowledge. The location of the samples and the assay data are s ufficiently reliable to support
resource evaluation. The sampling information was acquired primarily by GN Auger holes drilling on
spaced at 30-100 metres. As such the Mineral Resource is classi fied based on the following
principles:
 Indicated Mineral Resource: the areas less than 100 m spacing of the drillholes.
 Inferred Mineral Resource: the areas greater than 100 m and les s than 200 m spacing of the
drillholes.
Considering the specific IAC deposit type, SRK only categorised Indicated Mineral Resources in the
area have been topo surveyed as described in resource database section. All the blocks within the
area using Copernicus DTM were classified as Inferred Mineral Resources.
Due to the large bias between Mengkham original assay and SRK v erification results, Indicated
Mineral Resources were downgraded to Inferred Mineral Resources by SRK.
10.2.11 Mineral Resource Statement
The JORC Code 2012 defines a mineral resource as:
“a concentration or occurrence of material of solid material of economic interest in or on the Earth’s
crust in such form, grade (or quality) and quantity that there are reasonable prospects for eventual
economic extraction. The locat ion, quantity, grade (or quality) , continuity and other geological
characteristics of a Mineral Resource are known, estimated or i nterpreted from specific geological
evidence and knowledge, including sampling. Mineral Resources a re sub-divided, in order of
increasing geological confidence, into Inferred, Indicated and Measured categories.”
The “reasonable prospects for eventual economic extraction” requirement generally implies that the
quantity and grade estimates meet certain economic thresholds a nd that the mineral resources are
reported at an appropriate cut-off grade that takes into account extraction scenarios and processing
recoveries.
In contrast to conventional mining method, the in-situ leaching  operation and wet plant cannot be
treated as separate business units as the output PLS produced from the leaching process is directly
fed into a wet plant for processing and the processed solution from the PLS is then recycled for
leaching utilization. Therefore,  this RPEEE assessment consider s the technical and cost factors
associated with both the leaching process and the wet plant.
– IIID-93 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1933 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 71
The block model quantities and grade estimates were also reviewed to determine the portions of the
Mengkham deposit having “reasonable prospects for economic extr action, based on parameters
summarized in Table 10-11. The product price was sourced from t he guide REO price of Xiamen
Tungsten 2024. Detailed in Figure 18-1, the REO price was betwe en 220,000 RMB/t and 341,000
RMB/t from 2019 to 2023, averaging 263,000 RMB/t.
Table 10-11: Simplified Cost M odel used for RPEEE Assessment
Item Unit Value Remarks
Unit Cost
    Production Cost RMB/t RoM 15.7  SRK collected and analyzed
        Injection and Collection Cost RMB/t RoM 2.3 SRK collected and analyzed
        Raw Material RMB/t RoM 7.7 SRK collected and analyzed
        Pipes and Accessories RMB/t RoM 1.6 SRK collected and analyzed
        Power Cost RMB/t RoM 1 .1 SRK collected and analyzed
        Safety and Environmental Cost RMB/t RoM 0.2 SRK collected and analyzed
        Staff Salary RMB/t RoM 1 .2 SRK collected and analyzed
        Other Cost RMB/t RoM 1.6 SRK collected and analyzed
    Reclamation Cost RMB/t RoM 0 .6 SRK collected and analyzed
    G&A RMB/t RoM 0.3 SRK collected and analyzed
    Sales Cost RMB/t RoM 0.3 SRK collected and analyzed
Total Unit Cost RMB/t RoM 16. 9 SRK collected and analyzed
Recovery Rate
    Leaching Rate % 90.0 Mengkham REE PFS Report
    Processing Recovery Rate % 85.5 Mengkham REE PFS Report
Overall REE Recovery % 77.0 Mengkham REE PFS Report
Revenue
    Product Price RMB/t REO 239,000.0 Mengkham REE PFS Report
Based on the RPEEE assessment and considering the characteristics of the leaching mining method,
SRK selected a cut-off grade of 100 g/t SREO to report Mineral Resources.  The reader is cautioned
that the results of the estimate are used solely for the purpos e of testing the “reasonable prospects
for eventual economic extraction”  by in-situ leaching mining an d do not represent an attempt to
estimate Ore Reserves. The results are to be used as a guide fo r assisting in the preparation of a
Mineral Resource Statement and for selecting an appropriate resource-reporting cut-off grade.
The project is in the construction and commissioning phase., an d currently, no REE oxides are
available for sale.
As of 30 September 2024, by applying a cut-off grade of 100 g/t SREO, The Mineral Resources
which SRK estimated and reported are as follows:
 139.05 Mt Inferred Mineral Resour ce with an average grade of 24 1.79 g/t SREO, equivalent to
33.62 kt of soluble rare earth oxides within the Project area.
Table 10-12: Mineral Resource Statement 1 of Mangkham REE Project, as of 30 September
2024
License Category Dry BD (t/m 3) Mass (Mt) SREO (g/t) SREO (kt)
Trial Mining Inferre d 1.47 55.59 267.75 14.88
Exploration Inferred 1.47 83.47 224.51 18.74
Total Inferred 1.47 139.05 241.79 33.62
Notes:
1 Mineral Resources are not Ore Reserves and have not demonstrate d economic viability. All figures are rounded to reflect
the relative accuracy of the estimate. All composites have been capped where appropriate.
2 The information in this report which relates to Mineral Resource is based on information co mpiled by Mr. Huaixiang Li and
Dr. Anson Xu who are full time employees of SRK Consulting Chin a. Mr. Huaixiang Li is a Member of AIG and Dr. Anson
– IIID-94 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1934 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 72
Xu is a Fellow of AusIMM. Dr. Xu have sufficient experience whi ch is relevant to the style of mineralisation and the type of
deposits under consideration and to the activity which they are undertaking to qualify as the Competent Persons as defined
in JORC (2012).  Mr. Li and Dr. Xu consent to the reporting of this information in the form and context in which it appears.
3 Mineral Resources are reported at a cut-off grade of 100 g/t SR EO. Cut-off grades are based on a price of 239,000 RMB/t
REO.
10.2.12 Grade Sensitivity Analysis
The mineral resources of the Menkham project are sensitive to the selection of the reporting cut-off
grade. To illustrate this sensitivity, the global model quantities and grade estimates are presented in
Figure 10-27 at different cut-off grades. The reader is caution ed that the figures presented in this
table should not be misconstrued with a Mineral Resource Statement. The figures are only presented
to show the sensitivity of the block model estimates to the selection of cut-off grade.
Figure 10-27: Mengkham REE Project Grade Tonnage Curve

Source:SRK
Notes:
1 The reader is cautioned that the  figures should not be misconst rued with a Mineral Resource Statement. The figures are
only presented to show the sensitivity of the block model estimates to the selection of a cut-off grade.
– IIID-95 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1935 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Mineral Resource Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 73
10.3 SRK Comments
Mineral Resources have been estimated through creating resource models. The data and information
used for this resource model generation are acquired from the e xploration and were reviewed by
SRK to ensure the data reliability.
Due to the drilling and sampling methods employed in the explor ation, there is a possibility of
misidentification of certain sections potentially bearing REE. Consequently, this could lead to under-
delineation of the mineralized domains during resource modellin g, potentially resulting in a
conservative resource estimate.
– IIID-96 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1936 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Ore Reserve Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 74
11 Ore Reserve Estimates
11.1 Introduction
JORC Code 2012 provides for a direct relationship between Indic ated Mineral Resources and
Probable Ore Reserves and between Measured Mineral Resources an d Proved Ore Reserves. As
shown in Figure 11-1 below.
Figure 11-1: Relationship Between Mineral Resources and Ore Res erve

Sources: JORC Code 2012
The following statement has been extracted from the JORC Code 2012 for reference:
“An ‘Ore Reserve’ is the economically mine able part of a Measured and/or Indicated Mineral
Resource. It includes diluting materials and allowances for losses, which may occur when the
material is mined or extracted and is defined by studies at Pre-Feasibility or Feasibility level as
appropriate that include application of Modifying Factors. Such studies demonstrate that, at the time
of reporting, extraction could reasonably be justified.”
“The reference point at which Reserves are defined, usually the point where the ore is delivered to
the processing plant, must be stated. It is important that, in all situations where the reference point
is different, such as for a saleable product, a clarifying statement is included to ensure that the reader
is fully informed as to what is being reported.”
For Sepon REE Project, the current study indicates that the project would not be financially feasible.
Following discussions with LXML, it has been decided that only Mineral Resources will be reported
in the report .
– IIID-97 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1937 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Ore Reserve Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 75
For Mengkham REE Project, there are technical situations as of 30 September 2024 as followings:
According to the eligible JORC Code 2012 for Mineral Resources,  considering the resource within
both mining license and explorat ion license, when utilizing a S REO cut-off grade of 0.01%, the
following resources have been identified:
 Inferred Mineral Resource: 139.05 million tonnes at a grade of 241.79 g/t SREO.
The technical study is entitled “Mengkham Ion Adsorption Rare E arth Project Feasibility Study”
(“PFS”) and was prepared by CHIXIA Laos Holdings Limited (“CHIXIA”) on February 23, 2024.
According to JORC Code 2012, only Measured Mineral Resource and  Indicated Mineral Resource
can be considered when estimating Ore Reserves. In this instanc e, the Mengkham REE Project
contains solely Inferred Mineral Resource. After discussions wi th CHIXIA, it has been decided that
only a preliminary economic analysis based on PFS would be cond ucted to analyse the project's
economic feasibility and report project's modified Mineral Reso urces, and none of the Mineral
Resources would be converted to Ore Reserves.
Additionally, SRK has recommended to CHIXIA that necessary work s and studies be conducted to
increase geological confidence as well as technical and economic confidence.
11.2 Leaching Test of Mengkham REE Project
In the leaching test area, some of the topography has been clea red, and the PLS collection Tunnel
has been developed to approximately 7,000 meters, according to PFS. During the site visit in May
2024, it was observed that the injection process had already commenced. However, the collection of
the PLS had not yet been completed, and there was no final prod uct as of 30 September 2024.
Figure 11-2 below shows the in-situ injection system at the mountaintop.
– IIID-98 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1938 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Ore Reserve Estimates    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 76
Figure 11-2: In-Situ Injecti on System at The Mountaintop
Source: SRK
11.2.1 In-situ Leaching Mine Design
As described in the PFS, the mine is going to adopt the "in-sit u leaching" process. The PFS has
explained the procedures of the mining method, which will be discussed in more detail in Section 12.
SRK constructed a preliminary mining model based on the PFS's description and industrial standards.
For more explanations, refer to Section 11.
11.2.2 Modified Mineral Resources
As mentioned at the beginning of Section 11, Ore Reserves were not estimated. Based on reviewing
PFS, the modified Mineral Resources is shown in Table 11-1 below.
Table 11-1: Modified Mineral Resources of the CHIXIA Project, a s of 30 September 2024
Item Tonnage (Mt) SREO (g/t)
Total 138.04 239.42
Source: SRK.
Notes:
1 The term "Modified Mineral Resources" refers to the Mineral Resource incorporated into the mining and processing plans.
2 The ONLY modifying factor is the design loss caused by significant faults in the areas which make some Mineral Resources
unmineable/unleachable.
3 Modified Mineral Resources are not Ore Reserves and have not demonstrated economic viability.
4 During the preliminary economic analysis, other factors in cons iderations included a "mining/ leaching rate" of 90% and a
"processing recovery rate" of 85.5%. However, these factors are not included in the estimation of Modified Mineral
Resources.
– IIID-99 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1939 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
In-situ Leaching Mining    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 77
12 In-situ Leaching Mining
CHIXIA commenced to operate a testing operation in March 2024, in order to fine-tune the
parameters. In April 2024, CHIXIA requested SRK to conduct an independent review of the project.
The PFS was prepared by CHIXIA.  The key technical parameters li sted in Table 12-1 below are
summarized based on the PFS with SRK’s modification.
Table 12-1: In-situ Leaching Mi ning Design Parameters, as of 30 September 2024
Design Parameter Unit PFS's Inputs SRK's Inputs
Overall
In-situ Leaching Mining Recovery % 90.0 90.0
Processing Recovery % 85.5 85.5
Overall Recovery % 77.0 77.0
Wet Plant - REO tpa 3675&2800 3675&2800
PLS Capacity million m3 pa 16.3 &11.6 16.3 &11.6
In-situ Leaching Mining
Average Mineralized Body Depth m 8.7 7.9
Injection Holes m 4.0 4.0
Injection holes Cover Area m2 5.0 5.0
Collection Tunnel Cover Area m2 3.5 3.5
Source: CHIXIA
SRK's preliminary economic analysis was conducted based on the PFS, as well as information
collected from site visits and discussions with CHIXIA's technical team.
12.1 Introduction
The extraction of REEs involves several mining methods, each suited to different types of deposits.
 Open-pit mining is used for shallow deposits and involves remov ing overburden, drilling,
blasting, and transporting the ore, but it has significant environmental impacts.
 Underground mining is suitable for deeper deposits and involves creating shafts and tunnels,
but it is costlier and riskier.
 In-situ leaching, used for specific geological conditions, involves injecting a leaching solution
into the ore body to dissolve REEs, which are then pumped to the surface or collected from
the tunnels and subsequently pumped to the processing plant; it  has minimal surface
disturbance but potential groundwater contamination risks.
 Placer mining, used for alluvial deposits, involves excavating, screening, and concentrating
REE minerals, with lower environmental impact but limited to specific deposits.
The choice of method depends on deposit depth, type, economic factors, and environmental
considerations.
The in-situ leaching process can be divided into two stages:
 Leaching solution injection
 Collection of the PLS
– IIID-100 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1940 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
In-situ Leaching Mining    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 78
The choice of leaching solution is crucial and typically consis ts of a weak acid or salt solution
designed to selectively bind with the adsorbed REEs while minim izing harmful environmental
impacts. Common choices include ammonium sulfate, sodium chloride, or organic acids.
The leaching solution used in t he CHIXIA project primarily comp rises ammonium sulfate, which is
widely used in similar in-situ leach mines in China. Figure 12- 1 below shows the schematic view of
in-situ leaching mining.
Figure 12-1: Schematic Cross-secti on View of In-situ Leaching Mining
Source: SRK
12.2 Leaching Conditions
12.2.1 Topographic Condition
As illustrated in Figure 12-2, t he elevation of the rare earth exploration area generally ranges from
1,251 to 1,851 meters ASL, with the highest elevation in the eastern exploration area reaching 1,851
meters ASL. The relative elevation difference within the area varies between 15 and 173 meters.
– IIID-101 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


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Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
In-situ Leaching Mining    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 79
Figure 12-2: General Topographic Elevations within Exploration License

Source: SRK
1 It should be noted that the locations of the three processing plants depicted in the figure only demonstrate the approximate
layout and do not indicate the actual coordinates.
The topographic conditions are conducive to the strategic placement of leaching solution ponds and
injection holes. These conditi ons facilitate an acceptable dura tion for the migration of PLS and
provide a suitable hydraulic head for the delivery of PLS.
12.2.2 Occurrence and Lithology of the Mineralized Body
The PFS did not provide adequate information about the litholog y of the mineralized body; it only
explains the geological characteristics and weathering profile, which are as follows:
The deposit is formed by the weathering of medium-fine grained biotite granite, the main ore-forming
parent rock. The mining area's structure is simple, with the de posit located between NW-SE faults
and lacking fold structures.
Favourable climate and geography have preserved the weathered crust well. Geological surveys and
drilling show that the weathering st rength of rare earth minera ls varies due to lithology, uneven
weathering, and topography, resulting in a wavy distribution of  mineralization. Generally, clay-rich
mineralized body have better grades, with higher grades at the mountain top and waist, decreasing
towards the col and foot of the mountain.
The mineralized body is stratified and locally lenticular, with general continuity. The intact regolith
develops from topsoil, full regolith, and semi-regolith, with t he full regolith being the main mineral-
bearing layer.
– IIID-102 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1942 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
In-situ Leaching Mining    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 80
 Topsoil Layer: Mainly composed of biotite granite residuum, its  thickness varies, being
thinner or absent at the mountain top and thicker at the slope and foot. It often contains
humus and quaternary slope deposits, with a thickness of about 1-2 meters. This layer
generally does not contain rare earth minerals.
 Full Regolith: The primary rare earth-bearing layer, often flesh-red, light red, or grayish-white,
mainly composed of kaolin. It contains residual minerals like quartz, feldspar, and mica (1%-
3%), and accessory minerals such as ilmenite, monazite, and zir con (<1%). The thickness
ranges from 2.0 to 15 meters, with an average of 7 meters.
 Semi-Regolith: Grayish-white with a granite structure, composed mainly of quartz, feldspar,
and biotite. This layer is the bottom of the rare earth layer, with weak weathering and
kaolinization around feldspar grains. It generally does not contain rare earth minerals.
Given the thickness of the topsoil layer within the project area, conventional open-pit mining methods
could potentially cause significant surface disturbance. Furthe rmore, the regolith derived from the
weathered granite possesses a certain degree of hydraulic condu ctivity. Therefore, this rare earth
deposit is amenable to the application of in-situ leaching techniques for the extraction of REEs.
12.2.3 Geotechnical and Hy drogeological Conditions
Geotechnical condition
No geotechnical testing has been conducted on the regolith within the project area.
Hydrological and Hydrogeological Condition
In April 2024, CHIXIA conducted two experiments and summarized the results in the "Experimental
Research Report on the Specific Consumption of Leaching Agent a nd Injection Intensity for
Mineralized Body #2 of the Mengkham Rare Earth Project." Figure  12-3 shows the schematic
diagram of the experiment.
– IIID-103 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1943 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
In-situ Leaching Mining    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 81
Figure 12-3: Schematic Diagram of Leaching Injection Intensity Experiment

Source: CHIXIA
According to the report, the hydraulic conductivity of Mineralized Body #2 is 3.2-4.0 cm/h.
CHIXIA has not submitted any other hydrological and hydrogeolog ical condition investigations or
studies as of 30 September 2024. During the site visit, SRK was  informed by CHIXIA that
groundwater is not abundant in the project area. Currently, water is being sourced from a river ditch
located 1.3 km in a straight line from the mining area and the water resources can meet the
operational needs of the project now. SRK checked the local sur face water condition as it shows in
Figure 12-4 below.
– IIID-104 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1944 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
In-situ Leaching Mining    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 82
Figure 12-4: Local Surface Water Condition

Source: SRK
12.3 Leaching System
An independent in-situ leaching system primarily consists of an  injection system and a collection
system.
 The injection system is situat ed at the mountaintop and gentle slopes and is divided into
three components.
 The collection system is located at the foot of the mountain and may vary slightly depending
on the design approach for solution collection.
12.3.1 The Injection System
The injection system is designed to introduce a leaching solution into the mineralized body to dissolve
the REEs for extraction. The process involves preparing the mineralized body, injecting the leaching
solution, and closely monitoring the operation. The injection s ystem offers several advantages,
including efficiency, reduced environmental impact, and cost-ef fectiveness. However, it requires
precise control and careful management to ensure complete recov ery and avoid environmental
contamination.
The main three components are: leaching solution pond, injection holes and injection pipeline system.
Leaching Solution Pond
– IIID-105 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1945 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
In-situ Leaching Mining    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 83
The leaching solution pond is designed for storing the leaching solution before injection and is
typically constructed at the mountaintop. The leaching solution  is prepared in the wet plant and
pumped to the leaching solution pond using stainless steel pump s. From the pond, the leaching
solution flows through a pipeline system to the various injecti on holes. Figure 12-5 shows the
leaching solution pond during the site visit on 11 May 2024.
Figure 12-5: Leaching Solution Pond

Source: SRK
Injection Hole
Injection holes are arranged on the surface of each mineralized block at intervals of 2 to 3 meters by
2 to 3 meters. The specifications for these holes are as follows: diameter of 0.1 to 0.15 meters, with
the depth determined based on the burial depth of the mineralized bed, generally extending 0.5 to 2
meters into the mineralized bed roof. Each injection hole is equipped with an injection pipeline and a
gate valve to control the injection volume. Ammonium sulfate so lution is introduced into the
mineralized bed through the injection holes to recover REEs. Figure 12-6 shows the auger and
injection hole during the site visit on 11 May 2024.
– IIID-106 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1946 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
In-situ Leaching Mining    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 84
Figure 12-6: Auger and Injection Hole
Source: SRK
Injection Pipeline Network
In an in-situ leaching operation for REEs, the injection pipeli ne network would transport an
ammonium sulfate solution from leaching solution level pond to multiple injection. Control valves and
monitoring systems would ensure that the solution is delivered at the correct flow rate and pressure,
allowing for efficient dissolution and recovery of the REEs. Fi gure 11-2 shows the injection pipeline
network during the site visit on 11 May 2024.
12.3.2 PLS Collection System
The PLS collection system is a critical component of the in-sit u leaching process, designed to
efficiently collect the leachate containing dissolved REEs. The  system comprises four main
components:
PLS Collection Tunnel
A primary horizontal tunnel, known as the PLS collection tunnel, is excavated in the semi-weathered
rock beneath the mineralized bed, following the contour lines o f the mineralized bed's floor. This
tunnel is strategically placed to avoid barren zones and ensure maximum efficiency in capturing the
leachate.
According to PFS, the typical dimensions of the PLS collection tunnel have a top width of 0.3 to 0.4
meters, a bottom width of 0.6 to 0.8 meters, and a height of 1. 6 to 1.8 meters. The length of the
tunnel varies based on the miner alized bed's extension, general ly ranging from 60 to 200 meters.
– IIID-107 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1947 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
In-situ Leaching Mining    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 85
Sub-tunnels are arranged at intervals of 8 to 20 meters on both  sides of the main collection tunnel.
These sub-tunnels form a grid-like collection system, optimizing the capture of the leachate. All tunnel
floors are treated to prevent leakage and are sloped at 3% to 5% towards the tunnel entrance with a
collection pool. If the mineralized bed's floor has a significa nt dip angle, additional fan-shaped drill
holes may be constructed in the roof of the sub-tunnels to shorten the leachate's infiltration distance
and enhance collection efficiency.
The specifications of the PLS collection tunnel are shown in the beginning of Section 11.
Figure 12-7: Main PLS Collect ion Tunnel in Construction
Source: SRK
PLS Collection Hole
As described in the PLS collection tunnel section, fan-shaped d rill holes may be constructed to
enhance collection efficiency. Since the PFS does not specify t he parameters, standardized
parameters were adopted in preparing this report. These parameters include five holes on both wall
side of the tunnel, spaced 1 meter apart, with each hole having  a depth of 12 meters, refer to the
beginning of Section 11.
Main Collection Pipelines and Ditches
– IIID-108 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1948 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
In-situ Leaching Mining    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 86
A system of pipelines and ditches transports the PLS from the collection tunnels to the PLS hub pond.
The pipelines ensure a controlled and efficient flow of the PLS , while the ditches provide additional
pathways for the leachate, minimizing the risk of overflow and ensuring consistent delivery.
PLS Hub Pond
The hub pond is designed to accommodate large volumes of PLS, providing a buffer that ensures a
steady supply to the processing plant and allowing for any nece ssary adjustments in the leaching
process.
Figure 12-8: PLS Hub Ponds
Source: SRK
12.3.3 Recycled Solution System
After processing the PLS in the wet plant, the filtrate and supernatant flow into the ammonium sulfate
preparation ponds. Ammonium sulfate and sulfuric acid are added, and the solution is then pumped
by stainless steel pumps to the leaching solution pond at the m ine for continued leaching. This
injection treatment continues until the rare earth content in the collected PLS declines to a level that
is no longer economically recoverable. The PFS does not specify  the grade indicator for the
suspension of exploitation.
12.4 Leaching Unit Identification
The in-situ leaching unit determination normally involves following considerations:
Terrain: The stability of the surface t errain is important to ensure sa fe operations and to prevent
subsidence or collapse during and after the leaching process.
– IIID-109 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1949 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
In-situ Leaching Mining    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 87
SREO Content: The grade of the SREO, should be high enough to make the leach ing process
economically viable.
Water Table: areas below the groundwater table have relatively poor ion-ads orption rare earth
grades. Therefore, suitable mining areas are selected above the groundwater table.
According to PFS, it does not specify the leaching unit based on the factors mentioned above. In
preparing this report, SRK has considered the SREO content, wet  plant capacity and strategic
exploitation plan only based on the data collected.
It should be noted that there are two significant faults in the  southeast and northeast part of the
project as it shows in Figure 12-9. When conducting in-situ lea ching in areas with faults, the mining
recovery can be lower than expected. If fault areas are defined by offsetting 50 meters on both sides
of the faults, and the Mineral Resources within these fault are as are reported, it is estimated that
approximately 1-2% of the Mineral Resources are affected by the  faults. During this preliminary
analysis, it is assumed that the mineral resources in the fault areas are unrecoverable.
Below, Figure 12-9 shows the leaching unit identified for the project.
Figure 12-9: In-situ Leaching Unit Identification

Source: SRK
Notes:
1 It should be noted that the locations of the three processing p lants in the figure only demonstrate the approximate layout
and do not indicate the actual coordinates.

– IIID-110 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1950 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
In-situ Leaching Mining    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 88
12.5 Construction a nd Production Plan
12.5.1 Production Schedule
In Section 13, according to PFS, SRK has summarized the strategic plan for the construction of the
wet plant. The current operating plant, named the Leaching Test Plant, has a full production capacity
of 3,675 tpa REO. Additionally, there are two more plants planned: one with a production capacity of
3,675 tpa REO, named the North Plant, and another with a produc tion capacity of 2,800 tpa REO,
named the South Plant. These are scheduled to be put into operation in 2026 and 2028, respectively.
Based on the calculations in PFS, the total annual PLS throughp ut is 16.34 million cubic meters for
the 3,675 tpa REO plants and 11.55 million cubic meters for the 2,800 tpa REO plant.
The construction and operation plan are shown in Figure 12-10.
Figure 12-10: Construction and Production Chart

Source: SRK
The in-situ leaching schedule aligns with the annual PLS throughput capacity of the wet plants.
A mining schedule has been planned in terms of the proposed processing capacity as it shows in
Table 12-2.
Table 12-2: Mining Schedul e of the CHIXIA Project
Section Unit Total 2024 2025 2026 2027 2028 2029 2030 2031
Tonnage kt 138,040 4,620 19,700 18,040 19,590 19,650 25,020 19,150 12,270
Grade (SREO) g/t 239.42 221.94 266.10 236.15 237.71 218.51 220. 33 263.75 245.12
Source: SRK

– IIID-111 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1951 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
In-situ Leaching Mining    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 89
12.6 Conclusions and Recommendations
After reviewing PFS, SRK has conducted preliminary analysis bas ed on PFS and industry best
practices. In-situ leaching mining is widely used and should not pose major risks. However, SRK has
the following recommendations:
 Increase geological confidence: Enhance the understanding of th e geological conditions to
ensure accurate resource estimation and effective leaching operations.
 Collect production data: Gather production data to provide a better understanding of the in-
situ leaching recovery rates and to optimize the leaching process.
 Conduct geotechnical and hydrogeological investigations as well as studies: Guide the
design parameters for in-situ leaching, ensuring safe and efficient operations.
– IIID-112 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1952 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Recovery Methods    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 90
13 Recovery Methods
This section is only for the Mengkham REE project.
13.1 Overview
The ore of the Mengkham RE deposits is an ion-adsorption type r are earth, with an average SREO
grade of 0.025%. A preliminary feasibility study for the Project development had been carried out by
CHIXIA Laos Holdings Limited (“CHIXIA”) in 2023, with a designed production capacity of 3,675 tpa
REO.
The PFS adopts the "in-situ leaching (“ISL”)" process to extract the RE from the ore bodies. The rare
earth pregnant leaching solution (“PLS”) from ISL is then proce ssed in hydrometallurgical plant to
produce final product - mixed REO. The hydrometallurgical proce ss includes purification (impurities
removal), RE precipitation, REC filtration and calcination operations. The designed total recovery was
77%, with the ISL rate of 90% and the hydrometallurgical recovery rate of 85.5%.
Three hydrometallurgical plants and one calcination plant are planned to be built during the life of mine.
The Project had completed most of the construction of the Leaching Test Plant until May 2024, except
for the filter press workshop and calcination workshop. Additio nally, North Plant with production
capacity of 3,675 tpa REO and South Plant of 2,800 tpa REO are scheduled to be constructed in 2026
and 2028, respectively.
SRK's assessment on the hydrometallurgical processing is based on the Feasibility Study, as well as
information collected from site visits and discussions with the technical team of the client.
13.2 Hydrometallurgical Process
The PLS from ISL operation undergoes four steps of processing  which consists of purificati on,
precipitation, crystallization and filtration. The primary product is rare earth carbonate (“REC”), which
will be sent to the calcination workshop to produce mixed REO. The processing flowsheet is shown in
Figure 13-1, and specified as follows:
PLS Purification
The PLS collected from the ISL area is gathered and subsequently pumped into the PLS purification
ponds at the hydrometallurgical plant. The PLS contains some im purities which can influence the
quality of the product, so that need to be removed.  Ammonium b icarbonate solution is introduced
into the ponds, and the blend is consistently stirred by compre ssed air. The pH value of the PLS in
the pond is maintained within a range of 5.0 to 5.2, and the im purity ions will precipitate by forming
insoluble compounds.
The residue that precipitate from the PLS purification operatio n is primarily composed of Al (OH) 3,
Fe(OH)3, SiO2, clay, etc., and containing a small amount of REO. It is then dissolved by acid to
recycle REO, which would improve the REO processing recovery.
Precipitation and Crystallization
After impurity removal, the puri fied PLS enters the precipitati on ponds. Saturated ammonium
bicarbonate solution is introduced into the ponds, and a consistent and uniform stirring is maintained
– IIID-113 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1953 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Recovery Methods    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 91
using compressed air. The amount of the ammonium bicarbonate solution is carefully controlled until
reaching to a suitable pH value leading to the precipitation of the REC, which is then flowed into the
crystallization pond for still settlement, allowing the REC crystals to grow up. It is then pumped into
the filter press for dehydration. The supernatant can be recycled for ISL injection. The corresponding
reaction equation is as follows:
2RE3+ + 6HCO3
—
→ RE2(CO3)3 ↓ + 3CO2 ↑+3H2O
REC Dehydration and Calcination
The REC crystals are pumped into the filter press for dehydration. The resulting filter cake, which is
the wet REC product, is then conveyed to the calcination worksh op to produce mixed REO. The
filtrate is collected and pumped into the leaching solution preparation ponds.
Preparation of Leaching Solution
The ISL solution preparation pond contains a mixture of supernatant and filtrate, and the solution is
of alkaline as significant quant ity of ammonium bicarbonate con tained. As such the sulfuric acid is
added to convert the excess ammonium bicarbonate to ammonium sulphate and maintain a pH value
of about 5 for the solution. The reaction equation is as follows:
2NH4HCO3 + H2SO4 = (NH4)2SO4 + 2CO2↑ + 2H2O
After converting, the solution is tested to determine the concentration of ammonium ions. Ammonium
sulphate is subsequently added to formulate the leaching soluti on. This prepared solution is then
pumped into the mine elevation pond and injected into the orebodies through the injection system.
Figure 13-1: Processing Flowsheet of Hydrometallurgical Plant

Source: PFS report of Mengkham RE mine project in Mengkham Coun ty, Xieng Khouang Province, Laos, CHIXIA ,2023 and is prepared by
SRK.
– IIID-114 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1954 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Recovery Methods    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 92
13.3 Production Capacity and Technical Parameters
The production capacity of the mine depends on the scope area of the liquid injection holes and the
collection tunnels. Compared wi th the actual production capacit y of other similar mines, the full
production capacity of the first hydrometallurgical plant is 3,675 tpa REO, and SRK deems that it is
appropriate. Further considering the leaching unit classificati on and the distribution of different ore
bodies, it is planned to construct additional two hydrometallur gical plants, one with production
capacity of 3,675 tpa REO and the other one of 2, 800 tpa REO, which are scheduled to put into
operation in 2026 and 2028, respectively.
The hydrometallurgical plant adopts continuous working system, which is 330 working days per year,
with 2 shifts per day, and 12 hours per shift.
According to the FS report and discussion with the technical team of the client, SRK summarizes the
technical parameters of the hydrometallurgical plant, which are shown in Table 13-1.
Table 13-1: Main Technical Param eters of the Hydrometallurgical Plant
Design Parameter Unit Value
Annual Operational Days dpa 330
Overall Availability % 90.41
Daily Operating Hours hpd 24
PLS Flow Volume m3/d 44,545
PLS Flow Volume 1,000 m3/a 14,700
Average PLS Grade – REO g/l 0.25
Processing Recovery % 85.5
Overall Recovery % 77
pH Value of Purification n/a 5.0~5.2
pH Value of REE Precipitation n/a 6.8-7.2
Production - REO tpa 3,675
Source: PFS report of Mengkham RE mine project in Mengkham Coun ty, Xieng Khouang Province, Laos, CHIXIA ,2023 and is collected  by
SRK.
13.4 Main Equipment & Fac ilities & Plant Layout
The existing hydrometallurgical plant equipment mainly consist of pumps, filter press and compressor
machines, which are shown in T able 13-2. The facilities mainly include reagent warehouse,
ammonium bicarbonate solution preparing ponds, purification ponds, REC precipitation ponds, REC
crystallization ponds, residue turnover ponds, leaching solutio n preparation ponds, filter press
workshop, calcination workshop, p roduct warehouse, sulfuric aci d tank, power station, laboratory,
maintenance workshop, etc, which are listed in Table 13-3. All the ponds above are impermeable
with geotextiles.
Table 13-2: Main Equipment of the Existing Hydrometallurgical P lant
No. Equipment Name Specifications
and Models Unit Quantity  Remark
1 Acid-resisting Centrifugal Pump DF85-45*6 Set 20 Pump the ammonium sulfate
solution
– IIID-115 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1955 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Recovery Methods    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 93
No. Equipment Name Specifications
and Models Unit Quantity  Remark
2 Acid-resisting Centrifugal Pump DF85-45*7 Set 20 Pump the ammonium sulfate
solution
3 Acid-resisting Centrifugal Pump 280DF-43*3 Set 18 Pump the PLS
4 Acid-resisting Submerged Pump QY25-50-7.5F Set 15 Pump the ammonium
bicarbonate solution
5 Acid-resisting Submerged Pump QY80-18-7.5F Set 15 Pump the ammonium
bicarbonate solution
6 Air Compresso r PMVF90-II Set 9 Purification/Precipitation Stirring
7 Air Compresso r PMVF75-II Set 3  Stirring
8 Air Compressor PMVF55-II Set 8 Preparation ammonium sulfate
solution stirring
9 Diesel Generato r WPG2500*73 Set 1
10 Diesel Generato r WPG3025*73 Set 1
11 Diesel Generato r WPG2062*73 Set 1
12 Diesel Generato r WPG1250*73 Set 1
13 Diesel Generato r WPG206*8 Set 1
14 Press Filter  XMZGF300/1500-U Set 3 Filtration workshop
15 Rotary Kiln Set 2 Calcination workshop
Source: Client provided and SRK collected.
Table 13-3: Main Facilities of t he Hydrometallurgical Plant
No. Facility/Equipment Quantity
1 Ammonium sulfate preparation pond 9
2 Ammonium bicarbonate preparation pond 6
3 Ammonium bicarbonate high-level pond 2
4 Purification pond 22
5 Purification buffering pond 4
6 Precipitation pond 26
7 Slag head pond 3
8 Crystallization pond 4
9 Ammonium bicarbonate warehouse 1
10 Ammonium sulfate warehouse 1
11 Sulfuric acid tank warehouse 2
Source: Client provided and SRK collected.
According to the distribution of ore body and terrain conditions, hydrometallurgical plant is arranged
in the middle flat area of the mine.  Considering the requireme nts of the process order, the plant is
structured in a stepped manner al ong the hillside, which can ma ke the mother liquor flow by itself
and reduce the power consumption.
Till May 2024, the Project had completed most of the construction of the first hydrometallurgical plant,
except for the filter press workshop and calcination workshop. The general view of the plant is shown
in Figure 13-2.
– IIID-116 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1956 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Recovery Methods    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 94
Figure 13-2: General View of the  Hydrometallurgical Plant in Construction

Source: SRK site visit
13.5 Conclusions and Recommendations
The PLS undergoes four steps of processing to yield primary product of rare earth carbonate (“REC”),
which will be sent to the calcination workshop to produce mixed rare earth oxide (“REO”). The residue
will be dissolved by acid to recycle REO, which would improve the REO processing recovery and the
economic benefits.
The full production capacity of the existing hydrometallurgical plant is 3,675 tpa REO. The designed
total recovery was 77%, with the ISL rate of 90% and the hydrometallurgical recovery rate of 85.5%.
SRK deems that it is appropriate.
Three hydrometallurgical plants and one calcination plant are planned to be built during the life of mine.
The Project had completed most of the construction of the Leaching Test Plant till May 2024, except
for the filter press workshop and calcination workshop. Additio nally, North Plant with production
capacity of 3,675 tpa REO and South Plant of 2,800 tpa REO are scheduled to be constructed in 2026
and 2028, respectively.
– IIID-117 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1957 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Project Infrastructure    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 95
14 Project Infrastructure
This section only reports the project infrastructure of Mengkham REE project.
14.1 Industrial Sites
The industrial sites of the Mengkham REE Project, based on the PFS and the observation during the
site visit, mainly include the mining site, PLS processing plants and officing and living facilities etc.
The mining sites are the mineralized bodies designed for in-sit u leaching mining. Current leaching
test has developed the mining facilities in the first mining section.
The sites for PLS processing plants will be determined by consi dering various factors in order to
efficiently develop and utilize the mineral resources with optimal operating costs and minimizing the
environmental risks. The first PLS processing has been constructed and put in the leaching test.
Waste dumping sites will be the valleys near the mineralized blocks to be mined.
The officing and living sites should be chosen by considering s afety factors.  For the leaching test,
some facilities, such as office,  conference rooms, dining rooms , storages and lab etc. have been
constructed.
Table 14-1 lists the land area needed for the industrial sites proposed in the PFS.
Table 14-1: Proposed Land Area needed for the industrial sites proposed in the PFS
Item Unit Area
Mining sites m2 3,152,029.00
PLS Processing plants m2 78,237.65
Waste dumping sites m2 206,698.87
Officing and living site m2 5000
Water pumping station m2 100
14.2 Internal and External Transportation
Since the in-situ leaching method is adopted to mine and extract the REE in the mineralized bodies.
The transportation of various liquid between mining sites to the PLS processing plants will use pipes.
The dirt and/or gravel paved roads will connect various sites within the project area.
The project is near the provincial highway C1, and the highway will be used for the transportation of
supportive materials from outside, and the final products of the project will be trucked to outside.
14.3 Water Supply and Drainage
According to the PFS, in order to produce 3,674tpa REO, the water consumption is 7,425m3/day for
production.  Other water consumption includes for living and fire fight.
– IIID-118 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1958 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Project Infrastructure    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 96
Water sources in the project area are not abundant on the surface. There are two streams near the
plant, while their volume is small.  The PFS has proposed to co nstructing water storage facilities
where the two streams join.
Surrounding the PLS processing plants, ditches will be dug for water drainage of rainfalls.  Civil waste
water will be discharged into va lleys after treatment.  The wat er in the producti on will be recycled,
without any discharge.
14.4 Power Supply
The mine has been connected to the high-voltage feeder of 115KV , and constructed a transformer
substation to transform the electricity to 10KV. Through overhe ad lines, the power line connects to
substations of various sites, such as mining sites, plants, as well as living facilities.
14.5 Other Supportive Facilities
Other Supportive Facilities include communication systems, supportive constructions and machinery
maintenance and repairing.
– IIID-119 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1959 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Market Studies and Contracts    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 97
15 Market Studies and Contracts
There are abundant uses of REEs i n various aspects, such as met allurgy, petroleum, chemical
industry, glass and ceramics, textile, medicine, agriculture an d environmental protection etc.  With
the development of science and technology, people will recogniz e new properties of REEs, and
REEs have been becoming important materials for modern industry.
In recent years, the production of REE production in China cons tantly increased, and the market is
bright for the REEs.
There is no information at the moment on the contracts of product sales of the project.
– IIID-120 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1960 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Environmental, Social and Community Impact for Mengkham REE Project  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 98
16 Environmental, Social and Community Impact for
Mengkham REE Project
16.1 Environmental and Social Review Objectives
The objective of this environmental and social review is to identify and/or verify the existing and
potential environmental and social  liabilities and risks, and a ssess any associated proposed
remediation measures for the dev elopment and operation of the M engkham REE Project. During
SRK’s site visit in May 2024, the project was in the construction and metallurgical leach testing stage.
16.2 Environmental and Social Review
The process for the environmental and social preliminary review for the Project comprised a review
of provided project environmental and social management documen tation combined with site visit
observation against relevant criteria within:
 Laos national environmental regulatory requirements; and
 World Bank/International Finance Corporation (“IFC”) environmen tal and social standards and
guidelines and internationally recognised environmental management practices.
SRK notes that an Environmental a nd Social Impact Assessment (“ ESIA”) report has not been
prepared at this stage, and the Company is in the process to pr epare such a document to be
submitted for approval by the environmental authorities. SRK reviewed the environmental section
from the provided feasibility study report dated 2024 prepared by Chixia Laos Holdings Ltd against
recognized international industry environmental management standards, guidelines and practices.
SRK provides comments in respect to the Project’s environmental  management measures by the
following.
The environmental impact of mining encompasses erosion, sedimentation, biodiversity loss, and the
contamination of soil, groundwater, and surface water by chemicals from the mining industry. During
mining operations, the key pollutants anticipated to enter the river and affect the ecological system
are ammoniacal nitrogen and sulphate from the in-situ leaching process. The potential for chemicals
to leak into groundwater, espe cially through bedrock cracks, po ses threats not only to the
environment but also to public health and socio-ecological stability.
Since the injection solution contains ammonia nitrogen, there i s a high risk of eutrophication and
water pollution. To address these concerns, a series of mitigat ion strategies are proposed. These
include conducting clear water injections to detect potential cracks prior to injecting leaching solutions,
installing PVC linings in solution collection tunnels to preven t seepage, transforming existing wells
into groundwater monitoring sites while sourcing new water supp lies, initiating a comprehensive
groundwater monitoring program, and implementing engineering so lutions such as anti-seepage
layers and containment bunds.
The project might cause ecological disturbances, primarily due to the destruction of plant and crop
habitats during its development, mining, and operational phases . Additionally, the employment of
chemicals such as ammonium sulphate and ammonium bicarbonate in  mining processes poses a
risk to local vegetation, including rubber trees, by altering the soil composition.
– IIID-121 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1961 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Environmental, Social and Community Impact for Mengkham REE Project  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 99
The impact from noise and air quality might arise from site cle aring and construction activities. To
mitigate these impacts, several measures are proposed: dampenin g or covering access roads,
stockpiles, and vehicles transporting loose construction materi als; establishing a periodic
maintenance schedule for all motorized machinery and equipment,  focusing on the efficiency of
mufflers/silencers to reduce noise emissions, and implementing a Monitoring Plan. During the site
visit, SRK did not observe significant noise and fugitive dust emissions.
The recognised international industry practice for managing sit e closure and reha bilitation is to
develop and implement an operational site closure and rehabilitation planning process and document
this through an operational Clo sure and Rehabilitation Plan. Th is operational closure planning
process generally includes the following components:
 Identify all site closure stakeholders (e.g., government, employees, community);
 Undertake stakeholder consultation to develop agreed site closu re criteria and post operational
land use;
 Maintain records of stakeholder consultation;
 Establish a site rehabilitation objective in line with the agreed post operational land use;
 Describe/define the site closure liabilities determined against agreed closure criteria;
 Establish site closure management strategies and cost estimates to address/reduce site closure
liabilities;
 Establish a cost estimate and financial accrual process for site closure; and
 Describe the post site closure monitoring activities/program to demonstrate compliance with the
rehabilitation objective/closure criteria.
At this stage, no comprehensive mine closure plan has been developed. Based on SRK’s estimate,
the total cost of mine closure for this 8.0 km2 is approximately US$ 1.50 M. However, a mine closure
bond has not been established.
The proposed project is situated in an area characterized by a mix of land uses, including agricultural
land primarily planted with latex rubber trees. In addition to direct employment for local people, mining
industry can lead to promote local people’s living if natural r esource extraction occurs responsibly
and well managed to meet government and community requirements.  A well-developed Corporate
social responsibility (“CSR”) and community development (“CD”) can be the vehicle for achieving the
above objectives. No non-compliance notices or other notices of a breach of environmental or social
conditions for the Project from the Local or Provincial governments have been sighted as part of this
review. As part of this review, SRK has not sighted any documen tation in relation to any actual or
potential impacts of non-governm ental organisations on the sust ainability of the mining and
processing operations.
16.3 Evaluation of Environmental and Social Risks
The sources of environmental risk are project activities that m ay result in potential environmental
impacts.  These project activities have been previously described within this report. In summary, the
most significant potential environmental and social risks for the development of the Project, currently
identified as part of the project assessment and this SRK review, are:
– IIID-122 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1962 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Environmental, Social and Community Impact for Mengkham REE Project  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 100
 Environmental approval to be obtained;
 Water pollution; and
 Mine closure fund to be established
It is SRK’s opinion that the above environmental risks are categorised as medium risks (i.e., requiring
risk management measures) and they are generally manageable. Si nce various environmental
protection measures are planned or conducted by the Company to solve these environmental issues,
SRK considers that these environmental risks are controlled pro perly and not likely to develop into
higher level of risks.
– IIID-123 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1963 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Capital Expenditures and Operating Expenses    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 101
17 Capital Expenditures and Operating Expenses
17.1 Summary
A preliminary feasibility study (“PFS”) for the Mengkham REE Project had been carried out by CHIXIA
Laos Holdings Limited (“CHIXIA”) in 2023. The Leaching Test Plant with designed capacity of 3,675
tpa REO has been put into leaching test.  Additionally, North Plant with designed capacity of 3, 675
tpa REO and South Plant of 2,800 tpa REO are scheduled to be co nstructed in 2025 and 2027,
respectively.
The historical capital expenditu res (“Capex”) are provided by t he Client, and future Capex and
operating expenses (“Opex”) for the project are estimated according to the PFS. It is assumed that
all the Capex is own capital invested by the Client, no financial cost is considered.
Given the typical service life of each injection hole and colle ction tunnel being less than 1-2 years,
SRK deems it appropriate to allocate the related costs into the  Opex. This approach ensures a
comprehensive consideration of all relevant expenditures over the project's Life-of-mine (“LOM”).
17.2 Capital Expenditures
The estimated Capex primarily consists of the main production f acilities of three hydrometallurgical
plants, public auxiliary facilities and engineering constructio n other expenses (mainly the mining
rights or licence cost).
The total estimated Capex over the LOM is RMB130.32 million, which includes the historical
investment of RMB 66.35 million,  the sustaining investment of R MB 48.80 million and the closure
investment of RMB 15.17 million. Table 17-1 summarized the Capex breakdown for the Project.
The historical investment of RMB 66.35 million is used for the construction of Leaching Test Plant,
which is shown in Table 17-2. SRK take the historical investment as the sunk Capex, participating in
the depreciation and amortization over the LOM, but not participating in the net present value (“NPV”)
calculation.
The sustaining investment of RMB 48.8 million is estimated for the construction of North Plant and
South Plant, also including public facilities and other expenses. The future investment schedule are
summarized in Table 17-1.
The closure investment are used for the reclamation of each hyd rometallurgical plant and mine lot,
which is estimated to RMB 1.3 per square meter of mining area.
Table 17-1: The Capex Breakdown for the Mengkham REE Project (Unit: RMB M)
Item  Historical
Investment
Sustaining
Investment
Closure
Investment Total
Hydrometallurgy Plant
Construction 7.93 25.80 - 33.73
Public Auxiliary Facilities  19.44 13.00 - 32.44
Engineering Construction Other
Expenses  38.98 10.00 - 48.98
Closure - - 15.17 15.17
– IIID-124 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1964 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Capital Expenditures and Operating Expenses    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 102
Subtotal Investment  66.35 48.80 15.17 130.32
Table 17-2: Historical Investme nt Breakdown (Unit: RMB M)
Item Construction
Engineering Equipment Other
Expenses
Total
Value
Hydrometallurgy Plant Construction 7.93 - - 7.93
Public Auxiliary Facilities  4.23 15.21 - 19.44
Transport equipment - 2.65 - 2.65
Machinery equipment - 0.34 - 0.34
Office equipment - 0.13 - 0.13
Power equipment - 12.09 - 12.09
Office Place 1.18 - - 1.18
Camp 2.39 - - 2.39
Road  0.66 - - 0.66
Engineering Construction Other
Expenses  - - 38.98 38.98
 Land compensation fees  - - 2.49 2.49
Exploration right fees - - 35.49 35.49
Mining right fees - - 1.00 1.00
Total Investment  12.16 15.21 38.98 66.35
Table 17-3:  Future Investment Schedule (Unit: RMB M)
Item Total 2024 2025 2026 2027 2028 2029 2030 2031
Sustaining Investment 48.80 8.80 25.00 - 15.00 - - - -
Leaching Test Plant 8.80 8.80 - - - - - - -
North Plant 15.00 - 15.00 - - - - - -
South Plant 15.00 - - - 15.00 - - - -
Mining Right Fee 10.00 - 10.00 - - - - - -
Closure Investment 15.17 - - 4.76 - - 6.96 3.46
In addition to the Capex, the working capital cost will be inve sted into the project according to the
production schedule which will be recovered during closure of the project. It is estimated by expanded
index method which is 45% of Opex.
17.3 Operating Expenses
The Project's cash Opex primarily include the following items:
a. workforce employment;
b. consumables;
c. fuel, electricity, water and other services;
d. on and off-site administration;
e. environmental protection and monitoring;
– IIID-125 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1965 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Capital Expenditures and Operating Expenses    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 103
f. transportation of workforce;
g. product marketing and transport;
h. non-income taxes, royalties and other governmental charges; and
i. contingency allowances;
Table 17-4 summarized the forecasted Opex for the Project, with  a total Opex of RMB 4,264.61
million and unit cost of approximately 30.90 RMB/t RoM or 167,697 RMB/t REO. All costs are current
as of 30 September 2024, with no escalation factored in.
Table 17-4: Forecasted Opex of  the Mengkham RE Project
Item LOM Total Cost
(RMB M)
Unit Cost
(RMB/t RoM)
Unit Cost
 (RMB/t REO)
Workforce employment 150.80 1.09 5,930
Consumables 2,020.41 14.64 79,448
Fuel, electricity, water and other services 153.65 1.11 6,042
On and off-site administration 29.65 0.21 1,166
Environmental protection and monitoring 30.52 0.22 1,200
Transportation of workforce 5.48 0.04 216
Product marketing and transport 38.15 0.28 1,500
Non-income taxes, royalties and governmental
charges 1,613.60 11.69 63,451
Contingency allowances 222.35 1.61 8,743
Total 4,264.61 30.90 167,697




– IIID-126 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1966 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Preliminary Economic Analysis for Mengkham REE Project  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 104
18 Preliminary Economic Analysis for Mengkham REE
Project
Given that the project is currently at leaching test stage with the FS completed, the Discounted Cash
Flow ("DCF") modelling method under the income approach was con sidered an appropriate
technique to conduct the preliminary economic analysis.
The Capex and Opex estimated in the FS allowed SRK to create a technical economic model and
analyse the economic viabilities of the future mining operation. In addition to the FS, SRK's estimation
also relied on information collected through site visits and experience in this field.
The economic analysis presented in this section contains forward-looking information related to the
ore production estimate, commodity prices, exchange rates, prop osed production plan, projected
recovery rates, production cost, etc. The results of the econom ic analysis are subject to several
known and unknown risks, uncerta inties, and other factors that may cause actual results to differ
materially from those presented herein.
It is important to note that the purpose of this analysis is solely to demonstrate the economic viability
of the projects. The derived NPVs do not indicate the fair market values or the profitability of the
projects. The estimated cash flows and NPVs were presented on a n after-tax basis, and financing
costs were not considered.
The Net Present Value ("NPV") was estimated from the project's cash flow projections based on an
10% discount rate. Furthermore, a sensitivity analysis was conducted to assess the potential impacts
of variations in project capital costs, operating costs, and commodity prices.
18.1 Principal Assumptions
The assumptions applied to the economic model is based on the following principles:
 Product prices were based on Xiamen Tungsten 2024 REO guidance price which is described in
the FS report.
 The model utilizes a constant REO price during the life-of-mine and assumes that the final REO
product will be sold within the same year of production.
 The financial model utilizes Renminbi ("RMB") as the currency unit.
 Capex is depreciated and/or amortized using the straight-line m ethod. Working capital will be
fully recovered in the final year of the Project.
 Discount rate of 10% will be used in base case.
The principal assumptions and parameters applied in the DCF model are presented in Table 18-1.
Table 18-1: Principal Assumptions for the DCF Model of the Proj ect
Item Unit Value
Total ore output kt 138,036
SREO grade % 0.0239
Total REO Product t 25,431
– IIID-127 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1967 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Preliminary Economic Analysis for Mengkham REE Project  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 105
Item Unit Value
Life-of-Mine Year 8
Leaching rate % 90
Processing recovery rate % 85.5
Overall REE recovery rate % 77
Historical investment RMB M 66.35
Sustaining investment  RMB M 48.8
Unit Opex RMB/t RoM 30.90
Unit Opex RMB/t REO 167,697
Royalty % 20%@Sales Revenue
Export Tax % 10% @Sales Revenue
Discount rate % 10
Corporate income tax % 20%@Gross Profit
18.2 REO Price
The Project is an ion-type rare earth mine, and the ore belongs  to middle yttrium rich europium
(“MYRE”) mixed REO. Figure 18-1 shows the MYRE price trend from  2019 to 2023. It can be seen
from the figure that the price has shown a trend of rising initially and then stating to fall in 2022. The
lowest price including tax is 220,000 RMB/t REO, and the highes t price including tax is 341,000
RMB/t REO. The average annual price for 5 years is 263,400 RMB/t REO including tax.
Figure 18-1: Mixed REO Price Trend in History

Source: SMM
The price of mixed REO is determined by the allocation of each rare earth product and the price of
each REO.  At present, the Project is under the construction and early production stage, and without
sales agreement or pricing formula yet. Therefore, SRK adopts X iamen Tungsten guide REO price
in 2024, which is of 239,000 RMB/t REO (including tax) for DCF model calculation according to the
FS report. The value-added tax rate is 13%, thus the price excluding tax is 211,504 RMB/t REO.
– IIID-128 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1968 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Preliminary Economic Analysis for Mengkham REE Project  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 106
18.3 Depreciation, Amortization and Taxes
According to the accounting standards of Laos, the depreciation life of equipment such as machinery,
electronic equipment and transportation equipment is 5 years, and the salvage value is 0. Intangible
assets and other assets are amortized according to the REO output.
The Taxes and Surcharges primarily consist of royalties and export tax. The Client has informed SRK
that the royalty rate is 20%, while the export tax rate is 10% of the sales revenue. Additionally, SRK
has applied a Corporate Income Tax (“CIT”) of 20% on the gross profit, with royalties and export tax
being deductible expenses before calculating taxes.
18.4 Net Present Value Result
The net present value (“NPV”) of  RMB 471.23 million at 10% disc ount rate was estimated by SRK
using DCF model with the assumptions as outlined in the above section. The NPVs based on different
discount rate were also estimated, presented in Table 18-2, whi ch has demonstrated the economic
viability of the Project.
Table 18-2: Estimated NPVs at Different Discount Rate  (Unit: RMB M)
Discount Rate 8% 9% 10% 11% 12%
NPV  527.96 498.69 471.23 445.47 421.26
18.5 Sensitivity Analysis
SRK applied the single factor method for conducting the sensiti vity analysis. Many parameters can
affect the Project’s NPV. To simplify the calculations, the Opex, Capex, and REO product price were
selected as the essential variable factors on cash flow. The effects of these essential factors on the
NPV were analysed within a ±30% range. The corresponding results for the Project are presented in
Table 18-3 and Figure 18-2, respectively.
Table 18-3: Sensitivity Coefficient of NPV (at 10% Discount Rate, in RMB M)
Factors
Changes
-30% -20% -10% 0% 10% 20% 30% Average
+1%
Average
-1%
Price -427.34 -127.82 171.71 471.23 770.76 1,070.28 1,369.81 6.36 -6.36
Opex 1,213.19 965.87 718.55 471.23 223.92 -23.40 -270.72 -5.25 5.25
Capex 486.49 481.40 476.32 471.23 466.15 461.06 455.98 -0.11 0.11
The table showcases the sensitiv ity of the NPV with changes in price, Opex, and Capex. Price
fluctuations exhibit the most substantial impact, with a 30% increase boosting NPV to RMB 1,369.81
million, while Opex changes moderately influence NPV. Capex var iations have the least effect on
NPV.
– IIID-129 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1969 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Preliminary Economic Analysis for Mengkham REE Project  Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 107
Figure 18-2: Sensitivity Analysis on NPV


– IIID-130 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1970 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Risk Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 108
19 Risk Analysis
Mining is a relatively high-risk industry. In general, the risk  may be expected to decrease from
exploration, development, through to production stage.
The Sepon REE Project is in its early phases, primarily focused  on exploration and resource
identification. Given the inherent  risks at this stage, determining whether the identified mineral
resources can be economically developed will depend on the outcomes of a comprehensive technical
and economic analysis or feasibility study.
The Mengkham REE Project is a development-construction project.  In this risk analysis, SRK only
focus on the Mengkham REE Project. Risks exist in different are as. SRK considered various
technical aspects which may affect the feasibility and future cash flow of the Project, and conducted
a qualitative risk analysis which has been summarised in Table 19-1. In this risk analysis, various
risk sources/ issues have been assessed for Likelihood and Cons equence, and then a Risk Rating
has been assigned. The qualitative risk analysis uses the follo wing definitions for likelihood and
consequence:
In the risk assessment, various risk issues have been assessed for Likelihood, Consequence, and
Overall Rating. SRK has used a matrix as follows:
The Likelihood of a risk is considered within a certain time frame, e.g. 5 years, as:
Likely: will probably occur;
Possible: may occur; and
Unlikely: unlikely to occur.
The Consequence of a risk is classified into:
Major Consequence: the factor poses an immediate danger to the Project, if uncorrected, will have
a material effect on the Project cash flow and performance and could lead a project failure;
Moderate Consequence: the factor, if uncorrected, will have a significant effect on the Project cash
flow and performance; and
Minor Consequence: the factor, if uncorrected, will have little or no effect on the Project cash flow
and performance.
The overall risk assessment combines the Likelihood and Consequence of a risk and be classified
as Low (unlikely and possible minor risks and unlikely moderate risk), Medium (likely minor,
possible moderate and unlikely major risks), and High (likely moderate and major and possible
major risks).
Below is the qualitative risk analysis summary table of the Mengkham REE Project.
– IIID-131 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1971 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Risk Analysis    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 109
Table 19-1: Project Risk Assessment of the Mengkham REE Project
Risk Source/Issue Likelihood Consequence Overall
Geology and Resource
Lack of Significant Mineral Resources Unlikely Moderate Low
Lack of Significant Ore Reserves Possible Major High
Unexpected Groundwater Ingress Unlikely Minor Low
Mining
Subsidence and Ground Stability Possible Moderate Medium
Hydrogeological Modeling Uncertainties Unlikely Moderate Low
Significant Production Shortfalls Unlikely Major Medium
Significant Geological Structure Possible Minor Low
Ore Processing
Lower Recovery Unlikely Moderate Low
High Production Cost Possible Minor Low
Poor Plant Reliability Unlikely Minor Low
Capital and Operating Costs
Project Timing Delays Possible Minor Low
Capital Cost and Operating Cost Increases Possible Moderate Med ium
High mine closure cost Possible Moderate Medium
Environmental, Social and Permitting
Environmental approval to be delayed Possible Moderate Medium
Water eutrophication Possible Moderate Medium
Fund not available and without proper mine closure Possible Mod erate Medium
Some medium and high risks have been identified for the Project .  Two high risks are “Lack of
significant Ore Reserves” and “Capital Cost and Operating Cost Increases”. To manage the risks,
SRK recommends the Company should further conduct supplemental exploration programs following
guidelines of the best practice to upgrade the mineral resource basis, and then conduct a feasibility
study accordingly.
– IIID-132 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1972 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Interpretation and Conclusions    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 110
20 Interpretation and Conclusions
20.1 Sepon Rare Earth Element Deposit
20.1.1 Geology and Exploration
The Sepon Project is classified as an ion-adsorption type of rare earth deposit, wherein the majority
of REE occurs in an ion-exchangeable form, adsorbed onto clay minerals.
The core drilling, geological logging, and topographic survey w ere implemented to a standard
ensuring that the gathered data and information adequately underpin the objectives of subsequent
geological modelling and resource estimation.
SRK opines that the depth capacity of manual auger drilling mig ht be insufficient to penetrate
potentially semi-weathered hard layers or boulders. This limita tion could potentially lead to
incomplete intersections of the bottom of ore-bearing horizon during drilling.
The procedures for sample collection, preparation, and analysis  are following the REE industry
standards. SRK considers that the procedure, as well as the dat a and information obtained, are
acceptable for resource estimation purposes.
20.1.2 Mineral Resource Estimation
Mineral Resources have been estimated through creating resource models. The data and information
used for this resource model generation are acquired from the e xploration and were reviewed by
SRK to ensure the data reliability.
Due to the drilling and sampling methods employed in the explor ation, there is a possibility of
misidentification of certain sections potentially bearing REE. Consequently, this could lead to under-
delineation of the mineralized domains during resource modellin g, potentially resulting in a
conservative resource estimate.
20.2 Mengkham REE Project
20.2.1 Geology and Exploration
The Mengkham REE Project is classified as an ion-adsorption typ e of rare earth deposit, wherein
the majority of REE occur in an ion-exchangeable form, adsorbed onto clay minerals.
Exploration activities have revealed that the ion-exchangeable rare earth elements (“REE”) are
primarily concentrated within the mid-section of the regolith h orizon. At Mengkham the top of the
mineralised zone is defined by a thin surficial soil zone that averages 2 m in thickness. The base of
the mineralised zone extends to an average vertical depth of 9. 0 m. And the SREO grade ranges
from 9.5 to 2857 g/t, averaging 243.5 g/t.
The core drilling, geological logging, and topographic survey w ere implemented to a standard
ensuring that the gathered data and information adequately underpin the objectives of subsequent
geological modelling and resource estimation.
– IIID-133 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1973 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Interpretation and Conclusions    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 111
SRK opines that the depth capacity of manual auger drilling mig ht be insufficient to penetrate
potential semi-weathered hard layers or boulders. This limitation could potentially lead to incomplete
intersections of the bottom of ore-bearing horizon during drilling.
The implementation of sample collection, preparation, and analy sis in accordance with relevant
Chinese standards is a common practice employed across China for IAC REE exploration projects.
After reviewing the entire process and the duplicate sample tes t results, SRK considers that the
procedure, as well as the data and information obtained, are ac ceptable for resource estimation
purposes.
However, SRK considers that the rapid test method, which entail s visually observing rare earth
precipitates before conducting core sampling for laboratory ana lysis, is qualitative in nature. This
approach serves merely as an initial indication to assess the mineralization within the sampled core
interval. Due to its inherent subjectivity, this method may res ult in overlooking certain shallow-
occurring intervals containing REE sufficient for subsequent laboratory testing, potentially leading to
an underestimation of orebody thickness.
20.2.2 Mineral Resource Estimation
Due to the drilling and sampling methods employed in the explor ation, there is a possibility of
misidentification of certain sections potentially bearing REE. Consequently, this could lead to under-
delineation of the mineralized domains during resource modellin g, potentially resulting in a
conservative resource estimate.
Large bias was observed between Mengkham original assay and SRK  verification results. The
Mineral Resource are not abiding JORC (2012).
20.2.3 Metallurgical Testing and Recovery Methods
The Mengkham ore belongs to the ion-adsorbed type rare earth ore, with average soluble rare earth
oxide (“SREO”) content of 0.025%. The minerals are mainly quartz, feldspar, biotite, ilmenite, magnetite,
followed by zircon, apatite, xenotime, fluorite, sphene minerals and so on.
A simple laboratory column leaching test had been conducted on the samples from #2 ore body. The
results showed that the permeability coefficient is 0.89x10 -3 ～1.11x10-3cm/s and the pregnant
leaching solution (“PLS”) concentration can reach 2.0 g/L with the SREO leaching rate of about 94%.
The PLS undergoes four steps of processing to yield primary product of rare earth carbonate (“REC”),
which will be sent to the calcination workshop to produce mixed rare earth oxide (“REO”). The residue
generated from the processing will be dissolved by acid to recycle REO, which would improve the
REO processing recovery and the economic benefits.
The full production capacity of the Leaching Test Plant is 3,675 tpa REO. The designed total recovery
was 77%, with the ISL rate of 90% and the hydrometallurgical re covery rate of 85.5%. SRK deems
that it is appropriate.

– IIID-134 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1974 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Recommendations    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 112
21 Recommendations
21.1 Sepon REE Project
21.1.1 Mineral Resources Estimation
Looking ahead, the Sepon REE mine is considering in-situ leachi ng to be their main extraction
technique. However, the available data, which only includes 8 ionic analyses, falls short in providing
an accurate estimate of the mine's potential and productivity. The scant data does not paint a holistic
picture of what the mine can offer. For this reason, SRK sugges ts a re-analysis of the ionic REE
grade. Through this, SRK can have a clearer view of the mine's potential, which is crucial in devising
and executing efficient mining plans.
21.2 Mengkham REE Project
21.2.1 Mineral Resources Estimation
For the Mengkham REE project, the 1:5000 topographic aerial survey only covers an area of 2.3 km2.
SRK suggests the mine to conduct a detailed topographic survey covering the entire project area.
The mine's current approach is to analyse all basic samples in the lab onsite. While this might be
convenient and efficient, it may not provide the most accurate results.  Large bias was observed
between original assay and SRK’s verification results. It is recommended that all the samples should
be sent to a qualified laboratory for assaying again.
There are merely 30 samples that possess REE compositions. This limited number prompts SRK to
recommend that the mine increase its efforts in conducting more composition analyses. This is to
ensure a more reliable and expansive dataset for evaluation purposes.
SRK also recommends carrying out more research on structure or fault system. This is because
faults may have a substantial influence on the in-situ leaching mining method.
21.2.2 Metallurgical Testing and Recovery Methods
The column test is relatively simple and can only be used as a basic reference for in-situ leaching of
#2 ore body. Due to the differences in ROM properties and grade s of different ore bodies, SRK
recommends that each ore body should take representative ore sa mples to carry out test studies
before production.
According to the production schedule, North Plant with producti on capacity of 3,675 tpa REO and
South Plant of 2,800 tpa REO have been planned to be constructed in 2026 and 2028, respectively.
SRK suggested that the site selection and design of the two plants should be carried out as soon as
possible.

– IIID-135 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1975 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
References    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 113
22 References
1. Longyan Dadi Mining Development Service Co., LTD, Detailed Exploration Report of Mengkham
REE Mine in Mengkham County, Xiengkhouan Province, Laos PDR, January 2024.
2. Lane Xang Minerals Limited Company, General Exploration Report of Sepon South REE Deposit
in Savannakhet Province, Laos PDR, August 2022.
3. PFS Report of Mengkham RE Mine Project in Mengkham County, Xieng Khouang Province, Laos,
CHIXIA ,2023.



– IIID-136 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1976 ---
Competent Person’s Report for Sepon Rare Earth Element and Mengkham Rare Earth Element Projects in Lao People's Democratic Republic
Closure    Final
SRK CONSULTING CHINA LTD.    28 FEBRUARY 2025  AX/YS 114
Closure
This report was prepared by


Anshun Xu (Corporate Consultant)
Project Manager

and reviewed by


Yonglian Sun (Corporate Consultant)
Contributing Peer Review




All data used as source material plus the text, tables, figures, and attachments of this document have been reviewed and prepared
in accordance with generally accepted professional engineering and environmental practices.
– IIID-137 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1977 ---
Appendix A Trial Mining License
– IIID-138 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1978 ---
– IIID-139 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1979 ---
– IIID-140 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1980 ---
Appendix B Table 1 (JORC)
– IIID-141 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1981 ---
Section 1: Sampling Techniques and Data
(Criteria in this section apply to all succeeding sections.)
Criteria Explanation Commentary
Sampling
techniques
• Nature and quality o f sampling (e.g. cut
channels, random chips, or specific
specialised industry standard measurement
tools appropriate to the minerals under
investigation, such as downhole gamma
sondes, or handheld XRF instruments, etc.).
These examples should not be taken as
limiting the broad meaning of sampling.
• Include reference to measures taken to ensure
sample representivity and the appropriate
calibration of any measurement tools or
systems used.
• Aspects of the determinat ion of mineralisation
that are Material to the Public Report.
In cases where  ‘industry  standard’  work has
been done this would be relatively simple (e.g.
‘reverse circulation  drilling  was used to obtain
1 m samples from which 3 kg was pulverised
to produce a 30 g charge for fire assay’). In
other cases more explanation may be
required, such as where there is coarse gold
that has inherent sampling problems. Unusual
commodities or mineralisation   types (e.g.
submarine nodules) may warrant disclosure of
detailed information.

• For Sepon project, LXML conducted an
exploration program from November 2021
to July 2022. A total of 607 boreholes
(4,441 metres) were drilled.
For Mengkham project, Longyan Dadi
Mining Development Service Co., Ltd
conducted an exploration program from
January 2022 to December 2023. A total of
13,656 boreholes (198,957 metres) were
drilled.
• 1-meter samples.
• For Sepon project, hol es were drilled on a
200-metre x 100-metre or 100-metre x 100-
metre pattern.
For Mengkham project, holes were drilled
with a spacing of 30-100m.
• The sampling procedures are following the
Chinese REE industry standards

Drilling
techniques
• Drill  type (e.g. core, reverse circulation, open-
hole hammer, rotary air blast, auger, Bangka,
sonic, etc.) and details (e.g. core diameter,
triple or standard tube, depth of diamond tails,
face-sampling bit or other type, whether core
is oriented and if so, by what method, etc.).
• The manual GN auger was employed to
delineate and identify economically viable
zones in the regolith. This auger is
extensively used for exploring IAC rare
earth deposits in China.
• The specifications of the GN auger include
a 95 cm diameter x 0.5 m long auger
bucket equipped with 2 m drill rods.
• It is no need to do downhole survey
according to Chinese GN auger technical
procedures.
Drill sample
recovery
• Method of recording and assessing core and
chip sample recoveries and results assessed.
• Measures taken to maximise sample recovery
and ensure representative nature of the
samples.
• Whether a relationship exists between sample
recovery and grade and whether sample bias
may have occurred due to preferential
loss/gain of fine/coarse material.
• According to the drilling records, the auger
drilling achieved almost 100% core
recovery.
• There was no relationship between sample
recovery and grade.
Logging
• Whether core and chip samples have been
geologically and geotechnically logged to a
level of detail to support appropriate Mineral
Resource estimation, mining studies and
metallurgical studies.
• Whether logging is qualitat ive or quantitative in
nature. Core (or costean, channel, etc.)
• All borehole cores were logged by
geologists.
• According to the characteristics of the
granite weathering crust, the record
description, the round footage, the hole
depth and the sample length are measured
by qualified steel wire rulers and recorded.
– IIID-142 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1982 ---
Criteria Explanation Commentary
photography.
• The total length and percentage of the
relevant intersections logged.
• Core logging is  qualitative.
Sub-sampling
techniques and
sample
preparation
• If core, whether cut o r sawn and whether
quarter, half or all core taken.
• If non-core, whether r iffled, tube sampled,
rotary split, etc. and whether sampled wet or
dry.
• For all sample types , the nature, quality and
appropriateness of the sample preparation
technique.
• Quality control procedur es adopted for all sub-
sampling stages to maximize representivity of
samples.
• Measures taken to ensure that the sampling is
representative of the in situ material collected,
including for instance results for field
duplicate/second-half sampling.
• Whether sample sizes are appropriate to the
grain size of the material being sampled.
• All core taken.
• Sampled wet.
• After logging, sample location and length
were marked and numbered by logging
geologists. And then core samples were
put into numbered bags.
• Sample weights were  sufficient for the
mineralized materials.
Quality of assay
data and
laboratory tests
• The nature, quality and appropriateness of the
assaying and laboratory procedures used and
whether the technique is considered partial or
total.
• For geophysical tools, spectrometers,
handheld XRF instruments, etc., the
parameters used in determining the analysis
including instrument make and model, reading
times, calibrations factors applied and their
derivation, etc.
• Nature of quality cont rol procedures adopted
(e.g. standards, blanks, duplicates, external
laboratory checks) and whether acceptable
levels of accuracy (i.e. lack of bias) and
precision have been established.
• For Sepon project, sampl es were prepared
and assayed in the ALS lab in Australia.
For Mengkham project, samples were
prepared and assayed in lab onsite.
• For Sepon project, the assaying method is
ME-MS81.
For Mengkham project, the assaying
method is EDTA (Ethylene Diamine
Tetraacetic Acid) volumetric method.
• For Sepon project, QAQC procedures
included CRMs, blanks and duplicates.
• For Mengkham project, internal and
external lab check samples were used as
control samples.
Verification of
sampling and
assaying
• The verification of signi ficant intersections by
either independent or alternative company
personnel.
• The use of twinned holes.
• Documentation of prima ry data, data entry
procedures, data verification, data storage
(physical and electronic) protocols.
• Discuss any adjustm ent to assay data.
• For Sepon project, a total of 29 pairs field
duplicates were used and all pairs were
within 20% limits.
For Mengkham project, a total of 6,017
samples were collected as internal lab
check samples with a pass rate of 82%.
And a total of 3,500 samples were
collected as external lab check samples
with a pass rate of 92%.
• For Mengkham project, SRK collected 169
duplicates in May 2024, but a large bias
was observed between original assay and
verification results. Only about 19% of the
results for SREO are within ±20%. About
78% results are out of ±20%.
Location of data
points
• Accuracy and quality of surveys used to locate
drill holes (collar and down-hole surveys),
trenches, mine workings and other locations
used in Mineral Resource estimation.
• The locations of drilling holes were
surveyed by using hand-held GPS.
• The coordinate system applied for the
entire project is the UTM projection (Zone
48N) using the Indian 1960 Datum.
– IIID-143 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1983 ---
Criteria Explanation Commentary
• Specification of the grid system used.
• Quality and adequacy o f topographic control.
Data spacing and
distribution
• Data spacing for reporting of Exploration
Results.
• Whether the data spacing and distribution is
sufficient to establish the degree of geological
and grade continuity appropriate for the
Mineral Resource and Ore Reserve estimation
procedure(s) and classifications applied.
• Whether sample compositing has been
applied.
• For Sepon project, hol es were drilled on a
200-metre x 100-metre or 100-metre x 100-
metre pattern.
For Mengkham project, holes were drilled
with a spacing of 30-100m.
• Current borehole spac ing was sufficient to
establish geological and grade continuity
for Mineral Resources estimation
classification.
• Composites were applied.
Orientation of
data in relation to
geological
structure
• Whether the orientation of sampling achieves
unbiased sampling of possible structures and
the extent to which this is known, considering
the deposit type.
• If the relationship be tween the drilling
orientation and the orientation of key
mineralised structures is considered to have
introduced a sampling bias, this should be
assessed and reported if material.
• All boreholes were vertical.
Sample security • The measures taken to ensure sample
security.
• The samples were all properly numbered,
recorded before being sent to labs.
Audits or reviews • The results of any audits or reviews of
sampling techniques and data.
• For Sepon project, LXML completed the
audits during the exploration.
• For Mengkham proj ect, Longyan Dadi
Mining company completed the audits
during the exploration.


– IIID-144 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1984 ---
Section 2: Reporting of Exploration Results
(Criteria listed in the preceding section also apply to this section.)
Criteria Explanation Commentary
Mineral tenement
and land tenure
status
• Type, reference name/number,  location and
ownership including  agreements or material
issues with third parties  such as joint
ventures, partnerships, overriding royalties,
native title interests, historical sites,
wilderness or national  park and
environmental settings.
• LXML possesses an exploration permit
with an area of 1,010.40 km2, which is
valid until June 2026. The Sepon REE
project is in the southeast corner of the
permit.
• For Mengkham project, China
Investment Xieng Khouang Rare Earth
Minerals Limited possesses an trial
mining license of 8.0 km2 and a
exploration permit of 42.0 km2. The
expiry date of the trial mining license is
December 2025, and the exploration
permit is December 2024.
• The security of the tenure held at the time of
reporting along with any known impediments
to obtaining a licence to operate in the area.

Exploration done
by other parties
• Acknowledgment and appraisal of
exploration by other parties.
• For Sepon project, L XML Exploration
Department conducted an exploration
program from November 2021 to July
2022.
• For Mengkham proj ect, Longyan Dadi
Mining Development Service Co., Ltd
conducted an exploration program from
January 2022 to December 2023.
Geology • Deposit type, geological setting and style of
mineralisation.
• Both Sepon REE Project and
Mengkham REE Project are ion
adsorption type of REE deposits, which
was developed over granite bodies by
weathering the rock bodies and
transferring and enriching the REEs
bearing in the minerals into clay
minerals of the weathered zones by
adsorption.
• The REE-bearing regolith profile
provides a vertical cross-section of the
soil layers created by weathering and
other breakdown processes.
• The projects area is in a tropical region
with a warm and humid climate. The
granite rock in the area undergoes
intense weathering due to favourable
topographic conditions where erosion is
less significant than weathering. This
has led to the widespread formation of
weathered layers, which range from less
than 1 metre to over 50 metres thick in
some parts of the project area.
• The distribution of the weathered layer
is typically irregular due to erosion from
the river drainage system. Depending
on the extent of the weathered layer
covering the mountainous terrain, it can
be classified into two types from the in-
situ leaching perspective: full coverage
and exposed base types.
– IIID-145 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1985 ---
Criteria Explanation Commentary
• The Mengkham and Seop REE projects
are primarily characterized by low hills
and gentle, undulating terrain.
Influenced by a tropical climate, these
areas have a relatively thick regolith
cover. According to the classification,
the regolith layer developed within most
of the project area can be categorized
as the full-coverage type of IAC deposit.
Drill hole
Information
• A summary of all informa tion material to the
understanding of the exploration results
including a tabulation  of the following
information  for all Material drill holes:
• easting and northing of the drill hole collar
• elevation or RL (Reduced Level – elevation
above sea level in metres) of the drill hole
collar
• dip and azimuth of the hole
• down hole length and interception depth
• Hole length.
• If the exclusion of this i nformation is justified
on the basis that the information is not
Material and this exclusion  does not detract
from the understanding of the report, the
Competent  Person should clearly explain
why this is the case.
• For Sepon project, a total of 607
boreholes (4,441 metres) were
drilled.For Mengkham project, a  total of
13,656 boreholes (198,957 metres)
were drilled.
• For Sepon project, 591 holes were used
in the Mineral Resources estimation and
for Mengkham project, 13,251 holes
were used in the Mineral Resource
estimation.
• All information of boreholes were
collected, including collar, elevation,
depth, lithology etc.
Data aggregation
methods
• In reporting Exploration   Results, weighting
averaging techniques, maximum and/or
minimum grade truncations (e.g. cutting of
high grades) and cut-off grades are usually
Material and should be stated.
• Exploration data is reported as the
average sample grade. Top cutting was
used report the exploration results.
• Where aggregate intercepts incorporate
short lengths of high-grade results and
longer lengths of low grade results, the
procedure used for such aggregation should
be stated and some typical examples of such
aggregations should be shown in detail.
• No such preferential reporting of high-
grade results is presented.
• The assumptions used for any reporting of
metal equivalent values should be clearly
stated.

Relationship
between
mineralisation
widths and
intercept lengths
• These relationships are particularly important
in the reporting of Exploration Results.
• All boreholes were vertical.
• If the geometry of the mineralisation with
respect to the drillhole angle is known, its
nature should be reported.
• The rare earth minerals consist of a
medium-fine biotite granite regolith.
Notably, there are significant differences
among the rock regolith. As a result, the
ore composition and type are directly
linked to the regolith characteristics and
its rock types.
• If it is not known and only the down hole
lengths are reported, there should be a clear
statement to this effect (e.g. ‘down hole
length, true width not known’).

– IIID-146 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1986 ---
Criteria Explanation Commentary
Diagrams
• Appropriate maps and sections (with scales)
and tabulations of intercepts should be
included for any significant discovery being
reported These should include, but not be
limited to a plan view of drill hole collar
locations and appropriate sectional views.
• Appropriate maps and typical
sections were reported in this
report.

Balanced reporting
• Where comprehensive reporting of all
Exploration Results is not practicable,
representative reporting of both low and high
grades and/or widths should be practiced to
avoid misleading reporting of Exploration
Results.
• Reporting was fully representative of the
data collected at this stage.
Other substantive
exploration data
• Other exploration data, if meaningful and
material, should be reported including (but
not limited to): geological observations;
geophysical survey results; geochemical
survey results; bulk samples  – size  and
method of treatment;  metallurgical test
results;  bulk density, groundwater,
geotechnical and rock characteristics;
potential  deleterious or contaminating
substances.
• For Sepon project, i n the general
exploration report, 10 specific gravity
samples were also taken from drilling
cores and were measured in the lab of
the mine. In SRK’s opinion, it was
unable to collect density sample from
GN Auger hole cores. A dry bulk density
of 1.5 t/m3 was used in resource
estimation for Sepon project.
• For Mengkham project, a simple
laboratory column leaching test had
been conducted.
• A total of ten bulk density samples were
implemented across the project areas
with the natural bulk density (wet basis)
ranging from 1.7 to 1.81 t/m3, averaging
1.75 t/m3, dry bulk density ranging
between 1.35 and 1.55 t/m3, averaging
1.47 t/m3.
Further work
• The nature and scale of planned further work
(e.g. tests for lateral extensions or depth
extensions or large-scale step-out drilling).
• Diagrams clearly high lighting the areas of
possible extensions, including the main
geological interpretations and future drilling
areas, provided this information is not
commercially sensitive.
• Further drilling program is
recommended.


– IIID-147 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1987 ---
Section 3: Estimation and Reporting of Mineral Resources
(Criteria listed in section 1, and where relevant in section 2, also apply to this section.)
Criteria Explanation Commentary
Database integrity
• Measures taken to ensure that data has not
been corrupted by, for example,
transcription or keying errors, between its
initial collection and its use for Mineral
Resource estimation purposes.
• Data validation procedures used.
• A digitalized resource database was provided
to SRK, and SRK conducted crossing -
checking against logging data and typical
interpretation. All relevant data were imported
to Leapfrog, and validation routines were run
to confirm validity of all data.
Site visits
• Comment on any site visits undertaken by
the Competent Person and the outcome of
those visits.
• If no site visits have been undertaken
indicate why this is the case.
• During the period from 13 to 16 May 2024,
SRK conducted a site visit to the Sepon
REE Project.
• During the period from 9 to 11 May 2024,
SRK conducted site visits to the Mengkham
REE project.
Geological
interpretation
• Confidence in (or conversely, the
uncertainty of the geological interpretation of
the mineral deposit.
• Nature of the data used and of any
assumptions made.
• The effect, if any, of alternative
interpretations on Mineral Resource
estimation.
• The use of geology in guiding and
controlling Mineral Resource estimation.
• The factors affecting continuity both of grade
and geology.
• SRK has a high conf idence regarding the
geological interpretation for both Sepon and
Mengkham project.
• Both Sepon and Mengkham project
databases were composed of collar, survey,
assay, lithological data. Detailed geological
logging and surface mapping allowed
extrapolation, with a distance no more than
50 m.
• The geological boundaries were determined
by lithological and sampling data. SRK has
defined the REE mineralization zones, which
were mainly controlled by the topography.
Dimensions
• The extent and variability of the Mineral
Resource expressed as length (along strike
or otherwise), plan width, and depth below
surface to the upper and lower limits of the
Mineral Resource.
• The deposit type is an ion-adsorption type
hosted in weathered regolith. The
development level of the weathered regolith
layer largely shaped the distribution and
geometry of the REE mineralization. The
ore-bearing layers are mainly present in the
middle part of the fully weathered regolith
profile and the upper part of the semi-
weathered layer.
• The REE mineralized bodies generally
exhibit a stratiform appearance, with their
morphology controlled by the occurrence of
the weathered regolith. In relatively flat
mountaintop areas, the bodies tend to be
thicker and have a more pronounced sheet-
like shape. Whereas in steep hillside and
valley areas, the bodies tend to have a
thinner and more complex shape due to
erosion and transportation effects.
• For Sepon project, the el evation of the ore
body is 240 to 410 meters, the lowest
erosion base level in this area is 210
meters, and the ore body is above the
lowest erosion base level. The depth of the
ore body is generally 0-5 meters.
• For Mengkham project, the top of the
– IIID-148 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1988 ---
Criteria Explanation Commentary
mineralised zone is defined by a thin surficial
soil zone that averages 2 m in thickness. The
base of the mineralised zone extends to an
average vertical depth of 9.0 m.
Estimation and
modelling
techniques
• The nature and appropriateness of the
estimation technique(s) applied and key
assumptions, including treatment of extreme
grade values, domaining, interpolation
parameters and maximum distance of
extrapolation from data points. If a computer
assisted estimation method was chosen
include a description of computer software
and parameters used.
• The availability of check estimates, previous
estimates and/or mine production records
and whether the Mineral Resource estimate
takes appropriate account of such data.
• The assumptions made regarding recovery
of by-products.
• Estimation of deleteri ous elements or other
non-grade variables of economic
significance (e.g. sulphur for acid mine
drainage characterisation).
• In the case of block model interpolation, the
block size in relation to the average sample
spacing and the search employed.
• Any assumptions behind modelling of
selective mining units.
• Any assumptions about correlation between
variables.
• Description of how the geological
interpretation was used to control the
resource estimates.
• Discussion of basis for using or not using
grade cutting or capping.
• The process of validation, the checking
process used, the comparison of model data
to drill hole data, and use of reconciliation
data if available.
• For Sepon project, Y 2O3, La2O3 , CeO2 ,
Pr6O11 , Nd2O3 , Sm2O3 , Eu2O3 , Gd2O3 ,
Tb4O7 , Dy2O3 , Ho2O3 , Er2O3 , Tm2O3 ,
Yb2O3 , Lu2O3  were estimated using IDW2
in Leapfrog.
For Mengkham project, SREO was estimated
using IDW2 in Leapfrog.
• This is the first mineral  resource estimation
in accordance with JORC Code for both
Sepon and Mengkham project.
• The block model was constructed using a
block size of to 10 m × 10 m × 2 m (East ×
North × Elevation) for Sepon project and for
Mengkham project the size is to 10 m × 10
m × 4 m with a sub-block size of to 5 m × 5
m × 2 m.
• All samples were composited to 1-meter.
• The cumulative frequency and distribution
characteristics of the sample histogram
were used to do the top capping.
• SRK has validated the both block models by
swath plot and visual inspection, indicating
that the models was validated.
Moisture
• Whether the tonnages  estimated on a dry
basis or with natural moisture, and the
method of determination of the moisture
content.
• The tonnages are estim ated on a dry basis.
Cut-off parameters
• The basis of the adopted cut-off grade(s) or
quality parameters applied.
• For Sepon project, the Mineral Resources are
reported at a cut-off grade of 170 g/t TREO.
Cut-off grades are based on a price of
239,000 RMB/t REO.
• For Mengkham project, the Mineral
Resources are reported at a cut-off grade of
100 g/t SREO. Cut-off grades are based on a
price of 239,000 RMB/t REO.
– IIID-149 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1989 ---
Criteria Explanation Commentary
Mining factors or
assumptions
• Assumptions made regarding possible
mining methods, minimum mining
dimensions and internal (or, if applicable,
external) mining dilution. It is always
necessary as part of the process of
determining reasonable prospects for
eventual economic extraction to consider
potential mining methods, but the
assumptions made regarding mining
methods and parameters when estimating
Mineral Resources may not always be
rigorous. Where this is the case, this should
be reported with an explanation of the basis
of the mining assumptions made.
• For Sepon project, the feasibility study
has not undertaken yet.
• For Mengkham project, a preliminary
feasibility study was carried out. The
mining method is in-situ leaching. The
process of the in-situ leaching mining
involves mainly two parts: leaching
solution injection and pregnant leach
solution (“PLS”) collection.
Metallurgical
factors or
assumptions
• The basis for assumptions or predictions
regarding metallurgical amenability. It is
always necessary as part of the process of
determining reasonable prospects for
eventual economic extraction to consider
potential metallurgical methods, but the
assumptions regarding metallurgical
treatment processes and parameters made
when reporting Mineral Resources may not
always be rigorous. Where this is the case,
this should be reported with an explanation
of the basis of the metallurgical assumptions
made.
• A simple laboratory column leaching test
had been conducted on the samples from
2# ore body. The results showed that the
permeability coefficient is 0.89x10-3～
1.11x10-3cm/s and the pregnant leaching
solution (“PLS”) concentration can reach 2.0
g/L with the SREO leaching rate of about
94%.
• The FS designed total recovery was 77%,
with the ISL rate of 90% and the
hydrometallurgical recovery rate of 85.5%.
SRK deems that it is appropriate.
• The details are depicted in Section 12 and
Section13.
Environmental
factors or
assumptions
• Assumptions made regarding possible
waste and process residue disposal options.
It is always necessary as part of the process
of determining reasonable prospects for
eventual economic extraction to consider
the potential environmental impacts of the
mining and processing operation. While at
this stage the determination of potential
environmental impacts, particularly for a
greenfields project, may not always be well
advanced, the status of early consideration
of these potential environmental impacts
should be reported. W here these aspects
have not been considered this should be
reported with an explanation of the
environmental assumptions made.
The sources of environmental risk are project
activities that may result in potential
environmental impacts.  These project activities
have been previously described within this
report. In summary, the most significant potential
environmental and social risks for the
development of the Project, currently identified
as part of the project assessment and this SRK
review, are:

• Environmental approv al to be obtained;
• Water pollution; and
• Mine closure fund to be established
Bulk density
• Whether assumed or determined. If
assumed, the basis for the assumptions. If
determined, the method used, whether wet
or dry, the frequency of the measurements,
the nature, size and r epresentativeness of
the samples.
• The bulk density for bulk material must have
been measured by methods that adequately
account for void spaces (vugs, porosity,
etc), moisture and differences between rock
and alteration zones within the deposit.
• For Sepon project, i n the general
exploration report, 10 specific gravity
samples were also taken from drilling cores
and were measured in the lab of the mine.
In SRK’s opinion, it was unable to collected
density sample from GN Auger hole cores.
A dry bulk density of 1.5 t/m3 was used in
resource estimation.
• For Mengkham project, a total of ten bulk
density samples were implemented across
– IIID-150 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1990 ---
Criteria Explanation Commentary
• Discuss assumptions for bulk density
estimates used in the evaluation process of
the different materials.
the project areas with the natural bulk density
(wet basis) ranging from 1.7 to 1.81 t/m 3,
averaging 1.75 t/m3, dry bulk density ranging
between 1.35 and 1.55 t/m 3, averaging 1.47
t/m3. The average dry bulk density of 1.47
t/m3 is determined to use in resource
estimation.
Classification
• The basis for the classification of the Mineral
Resources into varying confidence
categories.
• Whether appropriate account has been
taken of all relevant factors (ie relative
confidence in tonnage/grade estimations,
reliability of input data, confidence in
continuity of geology and metal values,
quality, quantity and distribution of the data).
• Whether the result appro priately reflects the
Competent Person’s view of the deposit.
• Indicated Mineral Resource were
defined by the boreholes with the
spacing less than 100 m.
• Inferred Mineral Resource were defined
by the boreholes with the spacing less
than 200 m.
• For Mengkham project, Indicated
Mineral Resources were downgraded to
Inferred Mineral Resources duo to the
the large bias between Mengkham
original assay and SRK verification
results.
Audits or reviews.
• The results of any audits or reviews of
Mineral Resource estimates.
• The input data, including geological
mapping and drillhole data are
comprehensive in their coverage of the
mineralisation.
• The Mineral Resource estimate
appropriately reflects the view of the
Competent Person.
• The relative accuracy of the Mineral
Resource estimate is reflected in the
reporting of the Mineral Resource as per
the guidelines of the JORC Code.
• The statement relates to global volumetric
estimates.


– IIID-151 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1991 ---
Appendix C Compliance with 18 Chapter
– IIID-152 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1992 ---
Chapter 18
18.01 DEFINITIONS AND INTERPRETATION
18.02-
18.04 CONDITIONS FOR LISTING OF NEW APPLICANT MINERAL COMPANIES
18.02 In addition to satisfying  the requirements of Chapter 8, a Mineral Company which has CPR 2.2.2 [1]
 applied for listing must also satisfy the requirements of this  Chapter.
18.03 A Mineral Company must:—
 (1) establish to the Exchange’s satisfaction that it has the r ight to participate actively in CPR 3.1
  the exploration for and/or ext raction of Natural Resources, either:—
  (a) through control over a maj ority (by value) of the assets in which it has invested
   together with adequate rights over the exploration for and/o r extraction of
   Natural Resources; or
   Note: ‘control over a majority’ means an interest greater than 50%.
  (b) through adequate rights (arising under arrangements accep table to the
   Exchange), which give it suffi cient influence in decisions over the exploration
   for and/or extraction of the Natural Resources;
 (2) establish to the Exchange’s satisfaction that it has at least a portfolio of:— CPR 10.1.11; CPR
10.2.11
  (a) Indicated Resources; or
  (b) Contingent Resources,

identifiable under a Reporting Standard and substantiated in a Competent Person’s Report. This
portfolio must be meaningful and of sufficient substance to justify a listing;

 (3) if it has commenced producti on, provide an estimate of cash operating costs Not applicable.
  including the costs associated with:—
  (a) workforce employment;
  (b) consumables;
  (c) fuel, electricity, water and other services;
  (d) on and off-site administration;
  (e) environmental protection and monitoring;
  (f) transportation of workforce;
  (g) product marketing and transport;
  (h) non-income taxes, royalti es and other governmental charges; and
  (i) contingency allowances;

No
te:  A Mineral Company must:
   • set out the components of cash operating costs separately by category;
   • explain the reason for any departur e from the list of items to be included
   under cash operating costs; and
   • discuss any material cost items that should be highlighted to investors.
 (4) demonstrate to the Exchange’s satisfaction that it has available working capital for CPR 17.2; CPR 17.3
  125% of the group’s present requirements, that is for at leas t the next 12 months,
  which must include:—
  (a) general, administrative and operating costs;
  (b) property holding costs; and
  (c) the cost of any proposed exploration and/or development; and

No
te: Capital expenditures do not need to be included in working capital
   requirements. Where they are financ ed out of borrowings, relevant interest
   and loan repayments must be included.
 (5) ensure that its working capi tal statement in the listing document under Listing CPR 17.2; CPR 17.3
  Rule 8.21A states it has ava ilable sufficient working capital for 125% of the group’s
– IIID-153 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1993 ---
Chapter 18
  present requirements, that is  for at least 12 months from the date of its listing
  document.
18.04 If a Mineral Company is unabl e to satisfy either the profit test in rule 8.05(1), the market
 capitalisation/revenue/cash flow test in rule 8.05(2), or the market capitalisation/revenue
 test in rule 8.05(3), it may st ill apply to be listed if it can establish to the Exchange’s
 satisfaction that its directors and senior managers, taken tog ether, have sufficient
 experience relevant to the expl oration and/or extraction activity that the Mineral Company
 is pursuing. Individuals relied on must have a minimum of five years relevant industry
 experience. Details of the rele vant experience must be disclosed in the listing document of the new applicant.


No
te:  A Mineral Company relying on this rule mu st demonstrate that its primary activity is
  the exploration for and/or ex traction of Natural Resources.
18.05-
18.08 CONTENTS OF LISTING DOCUMENTS FOR NEW APPLICANTS
18.05 In addition to the information set out in Appendix 1A, a Mineral Company must include in
 its listing document:—
 (1) a Competent Person’s Report; CPR Executive
Summary and CPR 1.1
 (2) a statement that no materi al changes have occurred since the effective date of CPR 2.8
  the Competent Person’s Report. Where there are material chang es, these must be
  prominently disclosed;
 (3) the nature and extent of its prospecting, exploration, expl oitation, land use and CPR 3
  mining rights and a description of the properties to which th ose rights attach,
  including the duration and othe r principal terms and conditions of the concessions
  and any necessary licences and consents. Details of material rights to be obtained
  must also be disclosed;
 (4) a statement of any legal cla ims or proceedings that may have an influence on its
  rights to explore or mine; CPR 2.3
 (5) disclosure of specific risks and general risks. Companies should have regard to CPR 19
  Guidance Note 7 on suggested risk analysis; and
 (6) if relevant and material to t he Mineral Company’s business operations, information
  on the following:— CPR 16.3
  (a) project risks arising from  environmental, social, and health and safety issues;
  (b) any non-governmental or ganisation impact on sustainability of mineral and/or
   exploration projects;
  (c) compliance with host count ry laws, regulations and permits, and payments
   made to host country governm ents in respect of tax, royalties and other
   significant payments on a country by country basis;
  (d)
sufficient funding plans for remediation, rehabilitation and, closure and removal of facilities in a
sustainable manner;

  (e) environmental liabilities o f its projects or properties;
  (f) its historical experienc e of dealing with host country laws and practices,
   including management of differences between national and local practice;
  (g) its historical experienc e of dealing with concerns of local governments and
   communities on the sites of its mines, exploration propertie s, and relevant
   management arrangements; and
  (h) any claims that may exist over the land on which explorat ion or mining activity
   is being carried out, including any ancestral or native claims.
– IIID-154 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1994 ---
Chapter 18
18.06-
18.08 Additional disclosure requirements that apply to certain new applicant Mineral Companies
18.06 If a Mineral Company has  begun production, it must disclose an estimate of the operating CPR 17.2; CPR 17.3
 cash cost per appropriate unit for the minerals and/or Petroleum produced.
18.07 If a Mineral Company has not yet begun production, it must disclose its plans to proceed CPR 11.2; CPR 12
 to production with indicative dates and costs. These plans must be supported by at least a
 Scoping Study, substantiated by  the opinion of a Competent Person. If exploration rights or
 rights to extract Resources and/or Reserves have not yet been obtained, relevant risks to
 obtaining these rights must be prominently disclosed.
18.08 If a Mineral Company is involved in the exploration for or extraction of Resour ces, it must CPR 10
 prominently disclose to investors that its Resources may not ultimately be extracted at a
  profit.
18.09-
18.13 RELEVANT NOTIFIABLE TRANSACTIONS INVOLVING THE ACQUISITION
 OR DISPOSAL OF MINERAL OR PETROLEUM ASSETS
18.09 A Mineral Company proposi ng to acquire or dispose of assets which are solely or mainly
 Mineral or Petroleum Assets as part of a Relevant Notifiable Transaction must:—
 (1) comply with Chapter 14 and Chapter 14A, if relevant;
 (2) produce a Competent Pers on’s Report, which must form part of the relevant circular,
  on the Resources and/or Reserves being acquired or disposed o f as part of the
  Relevant Notifiable Transaction;

No
te:  The Exchange may dispense with the requirement for a Competent Person’s
    Report on disposals where sharehol ders have sufficient information on the
    assets being disposed of.
 (3) in the case of a major (or  above) acquisition, produce a Valuation Report, which must
  form part of the relevant circular, on the Mineral or Petrole um Assets being acquired
  as part of the Relevant Not ifiable Transaction; and
 (4) comply with the requirements of rules 18.05(2) to 18.05(6)  in respect of the assets
  being acquired.

No
te:  Material liabilities that remain with t he issuer on a disposal must also be discussed.
18.10-
18.11 Requirements that apply to listed issuers
18.10 A listed issuer proposing  to acquire assets which are solely or mainly Mineral or Petroleum
 Assets as part of a Relevant Notifiable Transaction must comply with rule 18.09.
18.11 On completion of a Relevan t Notifiable Transaction involving the acquisition of Mineral or
 Petroleum Assets, unless the Exchange decides otherwise, a listed issuer will be treated
 as a Mineral Company.
18.12-
18.13 Requirements that apply to Mineral Companies and listed issuers
18.12 The Exchange may dispense wi th the requirement to produce a new Competent Person’s
 Report or a Valuation Report under rules 18.05(1), 18.09(2) or  18.09(3), if the issuer
 has available a previously publ ished Competent Person’s Report or Valuation Report (or
 equivalent) which complies with rules 18.18 to 18.34 (where ap plicable), provided the
 report is no more than six months  old. The issuer must provide this document and a no
 material change statement in t he listing document or circular for the Relevant Notifiable
 Transaction.
18.13 An issuer must obtain the prior written consent of a Competent Person(s) or Competent
 Evaluator for their material to be included in the form and co ntext in which it appears in
 a listing document or circular fo r the Relevant Notifiable Transaction, whether or not such
– IIID-155 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1995 ---
Chapter 18
 person or firm is retained by the listing applicant or the iss uer.
18.14-
18.17 CONTINUING OBLIGATIONS
18.14 Disclosure in reports
18.14 A Mineral Company must incl ude in its interim (half-yearly) and annual reports details
 of its exploration, developmen t and mining production activities and a summary of
 expenditure incurred on these ac tivities during the period under review. If there has been
 no exploration, development or production activity, that fact must be stated.
18.15-
18.17 Publication of Resources and Reserves
18.15 A listed issuer that public ly discloses details of Resources and/or Reserves must give an
 update of those Resources and/or Reserves once a year in its a nnual report, in accordance
 with the reporting standard under which they were previously d isclosed or a Reporting
 Standard.
18.16 A Mineral Company must inc lude an update of its Resources and/or Reserves in its annual
 report in accordance with the Reporting Standard under which t hey were previously
 disclosed.
18.17 Annual updates of Resources an d/or Reserves must comply with rule 18.18.

No
te: Annual updates are not required to be supported by a Competent Person’s Report
  and may take the form of a no material change statement.
18.18-
18.27 STATEMENTS ON RESOURCES AND/OR RESERVES
18.18 Presentation of data
18.18 Any data presented on Resources and/or Reserves by a Mine ral Company in a listing
CPR 10.1.11; CPR
10.2.11
 document, Competent Person’s Report, Valuation Report or annual report, must be
 presented in tables in a manner readily understandable to a no n-technical person. All
 assumptions must be clearly dis closed and statements should include an estimate of
 volume, tonnage and grades.
18.19 Basis of evidence
18.19 All statements referring to Resources and/or Reserves:— .
 (1) in any new applicant listing document or circular relating to a Relevant Notifiable

Transaction, must be substantiated in a Competent Person’s Report which must form part of the
document; and
 (2) in all other cases, must a t least be substantiated by the issuer’s internal experts.
18.20 Petroleum Competent Persons’ Reports Not applicable. [2]
18.20
A Competent Person’s Report for Mineral Companies involved in the exploration for and/or extraction of
Petroleum Resources and Reserves must include the information
 set out in Appendix 25.

18.21-
18.22 Competent Person
18.21 A Competent Person must:—
 (1) have a minimum of five years experience relevant to the style of mineralization CPR 2.6; CPR2.7
  and type of deposit under consi deration or to the type of Petroleum exploration,
  reserve estimate (as appropri ate), and to the activity which the Mineral Company is
  undertaking;
 (2) be professionally qualified, and be a member in good standi ng of a relevant CPR 2.6; CPR2.7
  Recognised Professional Organisa tion, in a jurisdiction where, in the Exchange’s
  opinion, the statutory securiti es regulator has satisfactory arrangements (either by
– IIID-156 –
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--- page 1996 ---
Chapter 18
  way of the IOSCO Multilateral MOU or other bi-lateral agreement acceptable to the
  Exchange) with the Commission for mutual assistance and excha nge of information
  for enforcing and securing compliance with the laws and regul ations of that
  jurisdiction and Hong Kong; and
 (3) take overall responsibility for the Competent Person’s Repo rt. CPR 2.6; CPR2.7
18.22 A Competent Person must be independent of the issuer, its  directors, senior management CPR 2.10
 and advisers. Specifically the Co mpetent Person retained must:—
 (1) have no economic or beneficia l interest (present or contingent) in any of the assets
  being reported on;
 (2) not be remunerated with a fee dependent on the findings of  the Competent Person’s
  Report;
 (3) in the case of an individual, not be an officer, employee or proposed officer of the
  issuer or any group, holding or associated company of the issuer; and
 (4) in the case of a firm, not be a group, holding or associat ed company of the issuer.
  Any of the firm’s partners or  officers must not be officers or proposed officers of any
  group, holding or associated company of the issuer.
18.23 Additional requirements of Competent Evaluators
18.23 In addition to the requirements set out in rules 18.21(2) and 18.22, a Competent Evaluator
 must:—
 (1) have at least ten years rele vant and recent general mining or Petroleum experience
  (as appropriate);
 (2) have at least five years rele vant and recent experience in the assessment and/or
  valuation of Mineral or Petroleum Assets or securities (as appropriate); and
 (3) hold all necessary licences.

No
te:  A Competent Person’s Report or Valuation Report may be performed by the same
  Competent Person provided he or s he is also a Competent Evaluator.
18.24 Scope of Competent Persons’ Reports and Valuation Reports
18.24
A Competent Person’s Report or Valuation Report must comply with a Reporting Standard as modified by this
Chapter, and must:—

 (1) be addressed to the Mineral Company or listed issuer; CPR 2.2
 (2) have an effective date (being the date when the contents o f the Competent CPR 2.4
  Person’s Report or Valuation Report are valid) less than six months before the
  date of publishing the listing document or circular relating to a Relevant Notifiable
  Transaction required under the Listing Rules; and
 (3) set out what Reporting Standard has been used in preparing the Competent CPR 2.2
  Person’s Report or Valuation Report, and explain any departure from the relevant
  Reporting Standard.
18.25-
18.26 Disclaimers and Indemnities
18.25 A Competent Person’s Report or Valuation Report may conta in disclaimers of sections CPR 2.2
 or topics outside their scope of e xpertise in which the Competent Person or Competent
 Evaluator relied upon other ex perts’ opinions, but must not contain any disclaimers of the
 report in its entirety.
18.26 The Competent Person or Competent Evaluator must prominen tly disclose in the CPR 2.11, CPR 2.12
 Competent Person’s Report or Valuation Report the nature and d etails of all indemnities
 provided by the issuer. Indemniti es for reliance placed on information provided by issuers
 and third party experts (for information outside the Competent  Person’s or Competent

Evaluator’s expertise) are generally acceptable. Indemnities for fraud and gross negligence are generally
unacceptable.
– IIID-157 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
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--- page 1997 ---
Chapter 18

18.27 Obligations of sponsor
18.27 Any sponsor appointed to or by a new applicant Mineral Company under Chapter 3A must CPR1.4， CPR 1.7
 ensure that any Competent Person or Competent Evaluator meets the requirements of
 this Chapter.
18.28-
18.34 REPORTING STANDARD
18.28-
18.30 Mineral reporting standard
18.28 In addition to satisfying  the requirements of Chapter 13 (as modified by this Chapter), a
 Mineral Company exploring for and/or extracting mineral Resources and Reserves must
 also satisfy rules 18.29 and 18.30.
18.29 A Mineral Company must di sclose information on mineral Resources, Reserves and/or CPR 2.2
 exploration results either:—
 (1) under:
  (a) the JORC Code;
  (b) NI 43-101; or
  (c) the SAMREC Code,
  as modified by this Chapter; or
 (2) under other codes acceptable  to the Exchange as communicated to the market
  from time to time, provided t he Exchange is satisfied that they give a comparable
  standard of disclosure and sufficient assessment of the under lying assets.

No
te:  The Exchange may allow presentation of Reserves under other reporting standards
  provided reconciliation to a Reporting Standard is provided. A Reporting Standard
  applied to specific assets  must be used consistently.
18.30 A Mineral Company must ensure that:—
 (1) any estimates of mineral R eserves disclosed are supported, at a minimum, by a Prefeasibility Study; Not applicable
 (2) estimates of mineral Reser ves and mineral Resources are disclosed separately; CPR 10; CPR11
 (3) Indicated Resources and Measured Resources are only includ ed in economic Not applicable
  analyses if the basis on which  they are considered to be economically extractable
  is explained and they are appropriately discounted for the pr obabilities of their
  conversion to mineral Reserves. All assumptions must be clear ly disclosed.
  Valuations for Inferred Resources are not permitted;
 (4) for commodity prices used in Pre-feasibility Studies, Feas ibility Studies and Not applicable
  valuations of Indicated Resources, Measured Resources and Res erves:—
  (a) the methods to determine those commodity prices, all mate rial assumptions
   and the basis on which those prices represent reasonable views of future
   prices are explained clearly; and
  (b)  if a contract for future prices of mineral Reserves exis ts, the contract price is
   used; and

(5) for forecast valuations of Reserves and profit forecasts, sensitivity analyses to higher and lower prices are
supplied. All assumptions must be clearly disclosed. Not applicable

18.31-
18.33 Petroleum reporting standard Not applicable.[2]
18.31 In addition to satisfying  the requirements of Chapter 13 (as modified by this Chapter), a
 Mineral Company exploring for an d/or extracting Petroleum Resources and Reserves must
 also satisfy rules 18.32 and 18.33.
18.32 A Mineral Company must di sclose information on Petroleum Resources and Reserves
 either:—
– IIID-158 –
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--- page 1998 ---
Chapter 18
 (1) under PRMS as modified by this Chapter; or
 (2) under other codes acceptable to the Exchange if it is sati sfied that they give a
  comparable standard of discl osure and sufficient assessment of the underlying
  assets.

No
te:  A Reporting Standard applied to specific assets must be used consistently.
18.33 A Mineral Company must ensure that:—
 (1) where estimates of Reserves are disclosed, the method and reason for choice of
  estimation are disclosed (i.e. deterministic or probabilistic  methods, as defined in
  PRMS). Where the probabilistic method is used, the underlying confidence levels
  applied must be stated;
 (2) if the NPVs attributable to P roved Reserves and Proved plus Probable Reserves are
  disclosed, they are presented on a post-tax basis at varying discount rates (including
  a reflection of the weighted av erage cost of capital or minimum acceptable rate of
  return that applies to the entity at the time of evaluation) or a fixed discount rate of
  10%;
 (3) Proved Reserves and Proved plus Probable Reserves are anal ysed separately and
  principal assumptions (includi ng prices, costs, exchange rates and effective date) and
  the basis of the methodology  are clearly stated;
 (4) if the NPVs attributable to  Reserves are disclosed, they are presented using a
  forecast price as a base case or using a constant price as a base case. The bases
  for the forecast case must be disclosed. The constant price is defined as the
  unweighted arithmetic average of the closing price on the first day of each month
  within the 12 months before the end of the reporting period, unless prices are
  defined by contractual arrangemen ts. The basis on which the forecast price is
  considered reasonable must be disclosed and Mineral Companies must comply with
  rule 18.30;

No
te:  In the forecast case under PRMS , the economic evaluation underlying the
   investment decision is based on the entity’s reasonable forecast of future
   conditions, including costs and prices, which will exist during the life of the
   project.
 (5) if estimated volumes of Contingent Resources or Prospectiv e Resources are
  disclosed, relevant risk fa ctors are clearly stated;

No
te: Under PRMS, wherever the volume of a Contingent Resource is stated,
   risk is expressed as the chance t hat the accumulation will be commercially
   developed and graduate to the reserves class. Wherever the volume of a
   Prospective Resource is stated, risk is expressed as the chance that a potential
   accumulation will result in a significant discovery of Petroleum.
 (6) economic values are not att ached to Possible Reserves, Contingent Resources or
  Prospective Resources; and
 (7) where an estimate of future net revenue is disclosed, whether calculated without
  discount or using a discount rate, it is prominently disclose d that the estimated
  values disclosed do not rep resent fair market value.
18.34 Mineral or Petroleum Asset Valuation Reports Not applicable. [2,3]
18.34 A Mineral Company must ensure that:—
 (1) any valuation of its Miner al or Petroleum Assets is prepared under the VALMIN
  Code, SAMVAL Code, CIMVAL or such other code approved by the Exchange from
  time to time;
 (2) the Competent Evaluator s tates clearly the basis of valuation, relevant assumptions
– IIID-159 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
EARTH ELEMENT AND MENGKHAM RARE EARTH ELEMENT
PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 1999 ---
Chapter 18
  and the reason why a particula r method of valuation is considered most appropriate,
  having regard to the nature of the valuation and the developm ent status of the
  Mineral or Petroleum Asset;
 (3) if more than one valuation method is used and different va luations result, the
  Competent Evaluator comments on how the valuations compare an d on the reason
  for selecting the value adopted; and
 (4) in preparing any valuation a Competent Evaluator meets the requirements set out in rule 18.23.

Note：
1. CPR is the Competent Person’s Report prepared by SRK; and 2.2.2 is the section number.
2. Mineral Resources of this Project are the rare earth project.
3. The report prepared by SRK is not an Evaluation Report.






– IIID-160 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
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PROJECTS IN LAO PEOPLE ’S DEMOCRATIC REPUBLIC


--- page 2000 ---
Appendix D Chapter 2.6 of the Guide for New Listing
Applicants
– IIID-161 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
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--- page 2001 ---
Chapter 2.6
Section in SRK’s
Report
(i)
The cut-off grade (which should be an industry standard commonly used),
minimum mining width, economic parameters (e.g. waste to ore ratio, stope
productivity), specific gravity derivation, prevailing commodity price
assumptions;
Section 10.1.11 and
Section 10.2.11
(ii)
If the Competent Person has a different view on certain assumptions (e.g.
processing recovery rate) made by the applicant, both views should be
disclosed in the listing document, with differences highlighted and underlying
reasons for the different views, and the impact on the applicant if the more
conservative view is adopted;
Not applicable
(iii)
Detailed analysis for harmful elements identified at mines (e.g. mercury or
arsenic at lead and zinc mines) to give a better picture of whether there are
material concentrations of these elements within particular lodes, and the
impact on the saleability of the minerals;
Not applicable.
(iv) Clear and meaningful drawings and diagrams, shown to scale, of the location
of the applicant’s principal Mineral or Petroleum Assets;
Section 4
(v)
The procedures, amount of testing, assessment and time required to ascertain
the amount of Reserves, and the existing Reserves of the mine over its entire
mine life, expected average Resource and Reserve grades of ore that can be
extracted in future years (preferably covering the whole economic life of the
mine), depletion charges and hedging activities;
Not applicable
(vi)
Whether the historical or expected improved recovery rate is used for
estimating the net present value (“NPV”), and the basis on which the discount
rates are considered appropriate;
Section 18.4
(vii)
If the Competent Person did not conduct a site visit, the applicant should
disclose in the “Business” section of the listing document the basis on which
the Reserves/Resources, cost forecasts and other data relating to the mines/
oilfields as disclosed in the CPR are arrived at, how the lack of a site visit would affect the
reliability of the information, and an appropriate risk factor 3; and
Section 2.2.3
(viii) All material risks mentioned in the CPR should be disclosed in the “Risk
Factors” section of the listing document.
Section 19

– IIID-162 –
APPENDIX IIID COMPETENT PERSON ’S REPORT FOR THE SEPON RARE
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--- page 2002 ---
TAXATION FOR HOLDERS OF SECURITIES
Income tax and capital gains tax of holders of H Shares is subject to the laws and practices
of the PRC and of jurisdictions in which holders of H Shares are residents or otherwise subject
to tax. The following summary of certain relevant taxation provisions is based on current laws
and practices, and has not taken into account the expected change or amendment to the relevant
laws and policies and does not constitute any opinion or advice. The discussion does not deal
with all possible tax consequences relating to an investment in the H shares, nor does it take
into account the specific circumstances of any particular investor, some of which may be
subject to special regulation. Accordingly, you should consult your own tax advisor regarding
the tax consequences of an investment in the H shares. The discussion is based upon laws and
relevant interpretations in effect as of the Latest Practicable Date, all of which are subject to
change and may have retrospective effect.
No issues on PRC or Hong Kong taxation other than income tax, capital gain tax and
profits tax, business tax/V A T, stamp duty and estate duty were referred in the discussion.
Prospective investors are urged to consult their financial advisors regarding the PRC, Hong
Kong and other tax consequences of owning and disposing of the H Shares.
THE PRC TAXATION
Taxation on Dividends
Individual Investors
Pursuant to the Individual Income Tax Law of the PRC (੻೼
), which was most recently amended on August 31, 2018 and the Implementation
Provisions of the Individual Income Tax Law of the PRC (ྼ
ૢԷ), which was most recently amended on December 18, 2018 (hereinafter collectively
referred to as the “ IIT Law ”), dividends distributed by PRC enterprises are subject to
individual income tax levied at a flat rate of 20%. For a foreign individual who is not a resident
of the PRC, the receipt of dividends from an enterprise in the PRC is normally subject to
individual income tax of 20% unless specifically exempted by the tax authority of the State
Council or reduced by relevant tax treaty.
Pursuant to the Arrangement between Mainland China and the Hong Kong Special
Administrative Region for the Avoidance of Double Taxation and the Prevention of Fiscal
Evasion with Respect to Taxes on Income (ᅄ೼
τર) (hereinafter referred to as the “ Arrangement for the Avoidance of
Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income
(τર)”) signed by Mainland China and the Hong
Kong Special Administrative Region on August 21, 2006, the PRC government may impose tax
on dividends paid by a PRC company to a Hong Kong resident (including natural person and
legal entity), but such tax shall not exceed 10% of the total amount of dividends payable. If a
Hong Kong resident directly holds 25% or more of equity interest in a PRC company and the
APPENDIX IV TAXATION AND FOREIGN EXCHANGE
– IV-1 –


--- page 2003 ---
Hong Kong resident is the beneficial owner of the dividends and meets other conditions, such
tax shall not exceed 5% of the total amount of dividends payable by the PRC company. The
Fifth Protocol to the Arrangement between Mainland China and the Hong Kong Special
Administrative Region for the Avoidance of Double Taxation and the Prevention of Fiscal
Evasion with Respect to Taxes on Income (׵<׵
τર>) (the “ Fifth Protocol ”) issued by the
SA T and became effective on December 6, 2019, provides that such provisions shall not apply
to arrangements or transactions made for one of the primary purposes of obtaining such tax
benefits.
Enterprise Investors
In accordance with the Enterprise Income Tax Law of the PRC ( ʕശɛ͏΍ձ਷Άุ
) issued by NPC on March 16, 2007 and most recently amended on December 29,
2018 and the Implementation Provisions of the Enterprise Income Tax Law of the PRC ( ʕ
ૢԷ) issued by the State Council on December 6, 2007,
came into effect on January 1, 2008 and amended on April 23, 2019 (hereinafter collectively
referred to as the “ EIT Law ”), a non-resident enterprise is generally subject to a 10%
enterprise income tax on PRC-sourced income (including dividends received from a PRC
resident enterprise), if it does not have an establishment or premise in the PRC or has an
establishment or premise in the PRC but its PRC-sourced income has no real connection with
such establishment or premise. The aforesaid income tax payable by non-resident enterprises
are withheld at source, where the payer of the income is required to withhold the income tax
from the amount to be paid to the non-resident enterprise. Such withholding tax may be
reduced or exempted pursuant to an applicable treaty for the avoidance of double taxation.
The Circular of the State Administration of Tax on Issues Relating to the Withholding and
Remitting of Enterprise Income Tax by PRC Resident Enterprises on Dividends Distributed to
Overseas Non-Resident Enterprise Shareholders of H Shares (͏Ά
ุΣྤ̮H), which was
issued and implemented by the SA T on November 6, 2008, further clarified that a PRC-resident
enterprise must withhold corporate income tax at a rate of 10% on the dividends paid to
non-PRC resident enterprise holders of H Shares which are derived out of profit generated
since 2008. Non-PRC resident enterprise shareholders who need to enjoy tax treaty benefits,
the relevant provisions of such tax treaty shall apply.
Pursuant to the Arrangement for the Avoidance of Double Taxation and the Prevention of
Fiscal Evasion with Respect to Taxes on Income, the PRC government may impose tax on
dividends paid by a PRC company to a Hong Kong resident (including natural person and legal
entity), but such tax shall not exceed 10% of the total amount of dividends payable. If a Hong
Kong resident directly holds 25% or more of equity interest in a PRC company and the Hong
Kong resident is the beneficial owner of the dividends and meets other conditions, such tax
shall not exceed 5% of the total amount of dividends payable by the PRC company. The Fifth
Protocol provides that such provisions shall not apply to arrangements or transactions made for
one of the primary purposes of obtaining such tax benefits.
APPENDIX IV TAXATION AND FOREIGN EXCHANGE
– IV-2 –


--- page 2004 ---
Although there may be other provisions under the Arrangement for the Avoidance of
Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income, the
treaty benefits under the criteria shall not be granted in the circumstance where relevant gains,
after taking into account all relevant facts and conditions, are reasonably deemed to be one of
the main purposes for the arrangement or transactions which will bring any direct or indirect
benefits under this Arrangement, except when the grant of benefits under such circumstance is
consistent with relevant objectives and goals under the Arrangement. The application of the
dividend clause of tax agreements is also subject to the requirements of PRC tax laws and
regulations, such as the Notice of the State Administration of Taxation on the Issues
Concerning the Application of the Dividend Clauses of Tax Agreements (׵
).
Tax Treaties
Non-resident investors residing in jurisdictions which have entered into treaties or
adjustments for the avoidance of double taxation with the PRC might be entitled to a reduction
of the Chinese corporate income tax imposed on the dividends received from PRC companies.
The PRC currently has entered into treaties or adjustments for the avoidance of double taxation
with a number of countries and regions including Hong Kong Special Administrative Region,
Macau Special Administrative Region, Australia, Canada, France, Germany, Japan, Malaysia,
the Netherlands, Singapore, the United Kingdom and the United States. Non-PRC resident
enterprises entitled to preferential tax rates in accordance with the relevant taxation treaties or
arrangements are required to apply to the Chinese tax authorities for a refund of the corporate
income tax in excess of the agreed tax rate, and the refund application is subject to approval
by the Chinese tax authorities.
Taxation on Share Transfer
VAT and Local Additional Tax
Pursuant to the Notice on Fully Implementing the Pilot Reform for the Transition from
Business Tax to V alue-added Tax () (the
“Circular 36 ”), which was implemented on May 1, 2016 and partially repealed on July 1,
2017, January 1, 2018 and April 1, 2019, entities and individuals engaged in the services sale
in the PRC are subject to V A T and “engaged in the services sale in the PRC” means that the
seller or buyer of the taxable services is located in the PRC. Circular 36 also provides that
transfer of financial products, including transfer of the ownership of marketable securities,
shall be subject to V A T at 6% on the taxable revenue (which is the balance of sales price upon
deduction of purchase price), for a general or a foreign V A T taxpayer. However, individuals
who transfer financial products are exempt from V A T, which is also provided in the Notice of
Ministry of Finance and State Administration of Taxation on Several Tax Exemption Policies
for Business Tax on Sale and Purchase of Financial Commodities by Individuals (௅e
) effective on January 1,
2009. According to these regulations, if the holder is a non-resident individual, the PRC V A T
is exempted from the sale or disposal of H shares; if the holder is a non-resident enterprise and
the H-share buyer is an individual or entity located outside the PRC, the holder is not
necessarily required to pay the PRC V A T, but if the H-share buyer is an individual or entity
located in China, the holder may be required to pay the PRC V A T.
APPENDIX IV TAXATION AND FOREIGN EXCHANGE
– IV-3 –


--- page 2005 ---
However, in view of no clear regulations, it is still uncertain whether the non-Chinese
resident enterprises are required to pay the PRC V A T for the disposal of H shares in practice.
At the same time, V A T payers are also required to pay urban maintenance and
construction tax, education surtax and local education surcharge, which shall be usually subject
to 12% of the actual V A T payable (if any).
Income tax
Individual Investors
According to the IIT Law, gains on the transfer of equity interests in the PRC resident
enterprises are subject to individual income tax at a rate of 20%.
Pursuant to the Circular on Declaring that Individual Income Tax Continues to be
Exempted over Income of Individuals from the Transfer of Shares (੻
) issued by the SA T on March 30, 1998, from January 1,
1997, income of individuals from transfer of the shares of listed enterprises continues to be
exempted from individual income tax. The SA T has not expressly stated whether it will
continue to exempt tax on income of individuals from transfer of the shares of listed enterprises
in the most recently amended IIT Law.
However, on December 31, 2009, the Ministry of Finance, SA T and CSRC jointly issued
the Circular on Related Issues on Levying Individual Income Tax over the Income Received by
Individuals from the Transfer of Listed Shares Subject to Sales Limitation (ɛᔷᜫɪ
), which came into effect on January 1,
2010, which states that individuals’ income from the transfer of listed shares obtained from the
public offering of listed companies and transfer market on the Shanghai Stock Exchange and
the Shenzhen Stock Exchange shall continue to be exempted from individual income tax,
except for the relevant shares which are subject to sales restriction (as defined in the
Supplementary Notice on Related Issues on Levying Individual Income Tax over the Income
Received by Individuals from the Transfer of Listed Shares Subject to Sales Limitation ( ᗫ
) jointly issued and
implemented by such departments on November 10, 2010). As of the Latest Practicable Date,
no aforesaid provisions have expressly provided that individual income tax shall be levied from
non-PRC resident individuals on the transfer of shares in PRC resident enterprises listed on
overseas stock exchanges.
Enterprise Investors
According to the EIT Law, a non-resident enterprise is generally subject to a 10%
enterprise income tax on PRC-sourced income (including dividends received from a PRC
resident enterprise), if it does not have an establishment or premise in the PRC or has an
establishment or premise in the PRC but its PRC-sourced income has no real connection with
such establishment or premise. The aforesaid income tax payable by non-resident enterprises
are withheld at source, where the payer of the income is required to withhold the income tax
from the amount to be paid to the non-resident enterprise. Such withholding tax may be
reduced or exempted pursuant to an applicable treaty for the avoidance of double taxation.
APPENDIX IV TAXATION AND FOREIGN EXCHANGE
– IV-4 –


--- page 2006 ---
The Circular of the State Administration of Tax on Issues Relating to the Withholding and
Remitting of Enterprise Income Tax by PRC Resident Enterprises on Dividends Distributed to
Overseas Non-Resident Enterprise Shareholders of H Shares (͏Ά
ุΣྤ̮H), which was
issued and implemented by the SA T on November 6, 2008, further clarified that a PRC-resident
enterprise must withhold corporate income tax at a rate of 10% on the dividends paid to
non-PRC resident enterprise holders of H Shares which are derived out of profit generated
since 2008. Non-PRC resident enterprise shareholders who need to enjoy tax treaty benefits,
the relevant provisions of such tax treaty shall apply.
Stamp Duty
According to the Stamp Duty Law of the PRC (), which
was promulgated on June 10, 2021 and came into effect on July 1, 2022, PRC stamp duty only
applies to specific taxable document executed or received within the PRC, having legally
binding force in the PRC and protected under the PRC laws, thus the requirements of the stamp
duty imposed on the transfer of shares of PRC listed companies shall not apply to the
acquisition and disposal of H Shares by non-PRC investors outside of the PRC.
Estate Duty
As of the Latest Practicable Date, no estate duty has been levied in the PRC under the
PRC laws.
Enterprise Income Tax
According to the EIT Law, enterprises and other income-generating organizations
(hereinafter collectively referred to as “ an enterprise ”o r“ enterprises ”) within the territory
of the PRC are the taxpayers of enterprise income tax and shall pay enterprise income tax in
accordance with the provisions of the EIT Law. The Enterprise Income Tax rate is 25%.
According to the Administrative Measures for Determination of High and New Tech
Enterprises (), which was promulgated by the Ministry of
Science and Technology, the Ministry of Finance and the State Administration of Taxation on
April 14, 2008, amended on January 29, 2016 and became effective on January 1, 2016, an
enterprise recognized as a high and new technology enterprise may apply for a preferential
enterprise income tax rate of 15% pursuant to the relevant requirements of the EIT Law.
VAT
Pursuant to the Interim Regulations on V alue-added Tax of the PRC ( ʕശɛ͏΍ձ਷
೼ᅲБૢԷ) issued on December 13, 1993 by the State Council, came into effect on
January 1, 1994, and revised on November 10, 2008, February 6, 2016 and November 19, 2017,
as well as the Implementation Rules for the Interim Regulations on V alue-Added Tax of the
PRC () issued on December 25, 1993 by the
APPENDIX IV TAXATION AND FOREIGN EXCHANGE
– IV-5 –


--- page 2007 ---
MOF, came into effect on the same day and revised on December 15, 2008 and October 28,
2011, any entities and individuals engaged in the sale of goods, supply of processing, repair
and replacement services, and import of goods within the territory of the PRC are taxpayers of
V A T and shall pay the V A T in accordance with the law. The rate of V A T for sale of goods is
17% unless otherwise specified, such as the rate of V A T for sale of transportation is 11%. With
the V A T reforms in the PRC, the rate of V A T has been changed several times. The Notice of
the Ministry of Finance and the State Administration of Taxation on the Adjustment to V A T
Rates () which was promulgated by the
Ministry of Finance and the State Administration of Taxation on April 4, 2018 to adjust the tax
rates of 17% and 11% applicable to any taxpayer’s V A T taxable sale or import of goods to 16%
and 10%, respectively, and this adjustment became effective on May 1, 2018. Subsequently, the
Announcement of the Ministry of Finance and the State Administration of Taxation on Relevant
Policies for Deepening the V A T Reform (݁
ʮѓ) which was jointly promulgated by the MOF, the SA T and the General
Administration of Customs on March 20, 2019 to make a further adjustment, which came into
effect on April 1, 2019. The previous tax rate of 16% applicable to the V A T taxable sale
behavior or import of goods shall be adjusted to 13%, and the previous tax rate of 10%
applicable thereto shall be adjusted to 9%.
TAXATION IN HONG KONG
Tax on Dividends
Under the current practice of the Inland Revenue Department of Hong Kong, no tax is
payable in Hong Kong in respect of dividends paid by us.
Capital Gains Tax and Profits Tax
No tax is imposed in Hong Kong in respect of capital gains from the sale of H Shares.
However, trading gains from the sale of the H Shares by persons carrying on a trade,
professional services or business in Hong Kong, where such gains are derived from or arise in
Hong Kong from such trade, professional services or business, will be subject to Hong Kong
profits tax, which is currently imposed at the maximum rate of 16.5% on corporations and at
the maximum rate of 15% on unincorporated businesses. Certain categories of taxpayers (for
example, financial institutions, insurance companies and securities dealers) are likely to be
regarded as deriving trading gains rather than capital gains unless these taxpayers can prove
that the investment securities are held for long-term investment purposes. Trading gains from
sales of H Shares effected on the Hong Kong Stock Exchange will be considered to be derived
from or arise in Hong Kong. Liability for Hong Kong profits tax would thus arise in respect
of trading gains from sales of H Shares effected on the Hong Kong Stock Exchange realized
by persons carrying on a business of trading or dealing in securities in Hong Kong.
APPENDIX IV TAXATION AND FOREIGN EXCHANGE
– IV-6 –


--- page 2008 ---
Stamp Duty
Hong Kong stamp duty, currently charged at the ad valorem rate of 0.1% on the higher
of the consideration for or the market value of the H Shares, will be payable by the purchaser
on every purchase and by the seller on every sale of Hong Kong securities, including H Shares
(in other words, a total of 0.2% is currently payable on a typical sale and purchase transaction
involving H Shares). In addition, a fixed stamp duty of HK$5.00 is currently payable on any
instrument of transfer of H Shares. Where one of the parties is a resident outside Hong Kong
and does not pay the ad valorem duty due by it, the duty not paid will be assessed on the
instrument of transfer (if any) and will be payable by the transferee. If no stamp duty is paid
on or before the due date, a penalty of up to ten times the duty payable may be imposed.
Estate Duty
The Revenue (Abolition of Estate Duty) Ordinance 2005 ( 2005 ϋϗɝ(՟ऊ፲ପ೼)ૢ
Է) came into effect on February 11, 2006 in Hong Kong, pursuant to which, no Hong Kong
estate duty is payable and no estate duty clearance papers are needed for an application of a
grant of representation in respect of holders of H Shares whose deaths occur on or after
February 11, 2006.
FOREIGN EXCHANGE ADMINISTRATION IN THE PRC
The lawful currency of the PRC is Renminbi, which is currently subject to foreign
exchange control and cannot be freely converted into foreign currency. The SAFE, with the
authorization of the People’s Bank of China, is empowered with the functions of administering
all matters relating to foreign exchange, including the enforcement of foreign exchange control
regulations.
The Administrative Regulations on Foreign Exchange of the PRC ( ʕശɛ͏΍ձ਷̮
ි၍ଣૢԷ) which was issued by the State Council on January 29, 1996, implemented on
April 1, 1996 and latest amended on August 5, 2008, classifies all international payments and
transfers into current items and capital items. Current items are subject to the reasonable
examination of the veracity of transaction documents and the consistency of the transaction
documents and the foreign exchange receipts and payments by financial institutions engaging
in conversion and sale of foreign currencies and supervision and inspection by the foreign
exchange administrative authorities. For capital items, overseas organizations and overseas
individuals making direct investments in the PRC shall, upon approval by the relevant
authorities in charge, process registration formalities with the foreign exchange administrative
authorities. Foreign exchange income received overseas can be repatriated or deposited
overseas, and foreign exchange and foreign exchange settlement funds under the capital
account are required to be used only for purposes as approved by the competent authorities and
foreign exchange administrative authorities. In the event that international revenues and
expenditure occur or may occur a material misbalance, or the national economy encounters or
may encounter a severe crisis, the State may adopt necessary safeguard and control measures
on international revenues and expenditure.
APPENDIX IV TAXATION AND FOREIGN EXCHANGE
– IV-7 –


--- page 2009 ---
The Regulations for the Administration of Settlement, Sale and Payment of Foreign
Exchange (), which was promulgated by the People’s Bank of
China on June 20, 1996 and implemented on July 1, 1996, removes other restrictions on
convertibility of foreign exchange under current items, while imposing existing restrictions on
foreign exchange transactions under capital account items.
According to the Announcement on Improving the Reform of the Renminbi Exchange
Rate Formation Mechanism (ʮѓ), which was
issued by the People’s Bank of China and implemented on July 21, 2005, the PRC has started
to implement a managed floating exchange rate system in which the exchange rate would be
determined based on market supply and demand and adjusted with reference to a basket of
currencies since July 21, 2005. Therefore, Renminbi exchange rate was no longer pegged to
U.S. dollar. The People’s Bank of China would publish the closing price of the exchange rate
of Renminbi against trading currencies such as U.S. dollar in the interbank foreign exchange
market after the closing of the market on each working day, as the central parity of the currency
against Renminbi transactions on the following working day.
According to the relevant laws and regulations in the PRC, PRC enterprises (including
foreign investment enterprises) which need foreign exchange for current item transactions may,
without the approval of the foreign exchange administrative authorities, effect payment
through foreign exchange accounts opened at the designated foreign exchange bank, on the
strength of valid transaction receipts and proof. Foreign investment enterprises which need
foreign exchange for the distribution of profits to their shareholders and PRC enterprises (such
as our Company) which, in accordance with regulations, are required to pay dividends to their
shareholders in foreign exchange may, on the strength of resolutions of the board of directors
or the shareholders’ meeting on the distribution of profits, effect payment from foreign
exchange accounts at the designated foreign exchange bank, or effect exchange and payment
at the designated foreign exchange bank.
According to the Decisions on Matters including Canceling and Adjusting a Batch of
Administrative Approval Items ()
which was promulgated by the State Council on October 23, 2014, it decided to cancel the
approval requirement of the SAFE and its branches for the remittance and settlement of the
proceeds raised from the overseas listing of the foreign shares into RMB domestic accounts.
According to the Notice of the State Administration of Foreign Exchange on Issues
Concerning the Foreign Exchange Administration of Overseas Listing (׵
) issued by the SAFE and implemented on December 26,
2014, a domestic company shall, within 15 business days from the date of the end of its
overseas listing issuance, register the overseas listing with the local branch office of state
administration of foreign exchange at the place of its establishment; the proceeds from an
overseas listing of a domestic company may be remitted to the domestic account or deposited
in an overseas account, but the use of the proceeds shall be consistent with the content of the
prospectus and other disclosure documents.
APPENDIX IV TAXATION AND FOREIGN EXCHANGE
– IV-8 –


--- page 2010 ---
According to the Notice of the State Administration of Foreign Exchange on
Revolutionizing and Regulating Capital Account Settlement Management Policies (̮ි
) which was promulgated by the SAFE
and implemented on June 9, 2016, foreign currency earnings in capital account that relevant
policies of willingness exchange settlement have been clearly implemented on (including the
recalling of raised capital by overseas listing) may undertake foreign exchange settlement in
the banks according to actual business needs of the domestic institutions.
APPENDIX IV TAXATION AND FOREIGN EXCHANGE
– IV-9 –


--- page 2011 ---
This Appendix sets out summaries of certain aspects of PRC laws and regulations, which
are relevant to the Company’s operations and business. Laws and regulations relating to
taxation in the PRC are discussed separately in “Appendix III — Taxation and Foreign
Exchange” to this Prospectus. The principal objective of this summary is to provide potential
investors with an overview of the principal PRC legal and regulatory provisions applicable to
the Company. This summary is not intended to include all the information which may be
important to potential investors. For more details on laws and regulations which are relevant
to our business, please refer to the section headed “Regulatory Overview” in this Prospectus.
THE PRC LEGAL SYSTEM
The PRC legal system is based on the Constitution of the PRC ()
(the “ Constitution ”) and is made up of written laws, administrative regulations, local
regulations, separate regulations, autonomous regulations, rules and regulations of
departments, rules and regulations of local governments and international treaties of which the
PRC government is a signatory, and other regulatory documents. Court verdicts do not
constitute binding precedents. However, they may be used as judicial reference and guidance.
Pursuant to the Constitution and the Legislation Law of the PRC (2023 revision) ( ʕശ
جج2023ࠈࡌthe “ Legislation Law ”), the NPC and the Standing
Committee of the NPC (SCNPC) are empowered to exercise the legislative power of the State.
The NPC has the power to formulate and amend basic laws governing civil and criminal
matters, state organs and other matters. The SCNPC is empowered to formulate and amend
laws other than those required to be enacted by the NPC and to supplement and amend any
parts of laws enacted by the NPC during the adjournment of the NPC, provided that such
supplements and amendments are not in conflict with the basic principles of such laws.
The State Council is the highest organ of the PRC administration and has the power to
formulate administrative regulations based on the Constitution and laws.
The people’s congresses of provinces, autonomous regions and municipalities and their
respective standing committees may formulate local regulations based on the specific
circumstances and actual requirements of their own respective administrative areas, provided
that such local regulations do not contravene any provision of the Constitution, laws or
administrative regulations.
The ministries and commissions of the State Council, PBOC, National Audit Office of the
PRC as well as the other organs endowed with administrative functions directly under the State
Council may, in accordance with the laws as well as the administrative regulations, decisions
and orders of the State Council and within the limits of their power, formulate rules.
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– V-1 –


--- page 2012 ---
The people’s congresses of cities divided into districts and their respective standing
committees may formulate local regulations in terms of urban and rural development and
management, environmental protection, and historical and cultural protection based on the
specific circumstances and actual requirements of such cities, which will become enforceable
after being reported to and approved by the standing committees of the people’s congresses of
the relevant provinces or autonomous regions but such local regulations shall conform with the
Constitution, laws, administrative regulations, and the relevant local regulations of the relevant
provinces or autonomous regions. People’s congresses of national autonomous areas have the
power to enact autonomous regulations and separate regulations in light of the political,
economic and cultural characteristics of the nationality (nationalities) in the areas concerned.
The people’s governments of the provinces, autonomous regions, and municipalities
directly under the central government and the cities divided into districts or autonomous
prefectures may enact rules, in accordance with laws, administrative regulations and the local
regulations of their respective provinces, autonomous regions or municipalities. The
Constitution has supreme legal authority and no laws, administrative regulations, local
regulations, autonomous regulations or separate regulations may contravene the Constitution.
The authority of laws is greater than that of administrative regulations, local regulations and
rules. The authority of administrative regulations is greater than that of local regulations and
rules. The authority of local regulations is greater than that of the rules of the local
governments at or below the corresponding level. The authority of the rules enacted by the
people’s governments of the provinces or autonomous regions is greater than that of the rules
enacted by the people’s governments of the city divided into districts or autonomous prefecture
within the administrative areas of the provinces and the autonomous regions.
The NPC has the power to alter or annul any inappropriate laws enacted by the SCNPC,
and to annul any autonomous regulations or separate regulations which have been approved by
the SCNPC but which contravene the Constitution or the Legislation Law. The SCNPC has the
power to annul any administrative regulations that contravene the Constitution and laws, to
annul any local regulations that contravene the Constitution, laws or administrative
regulations, and to annul any autonomous regulations or local regulations which have been
approved by the standing committees of the people’s congresses of the relevant provinces,
autonomous regions or municipalities directly under the central government, but which
contravene the Constitution and the Legislation Law. The State Council has the power to alter
or annul any inappropriate ministerial rules and rules of local governments. The people’s
congresses of provinces, autonomous regions or municipalities directly under the central
government have the power to alter or annul any inappropriate local regulations enacted or
approved by their respective standing committees. The people’s governments of provinces and
autonomous regions have the power to alter or annul any inappropriate rules enacted by the
people’s governments at a lower level.
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– V-2 –


--- page 2013 ---
According to the Constitution and the Legislation Law, the power to interpret laws is
vested in the SCNPC. According to the Decision of the Standing Committee of the NPC
Regarding the Strengthening of Interpretation of Laws (׵
Ӕᙄ) passed on June 10, 1981, the Supreme People’s Court of the PRC
(the “ Supreme People’s Court ”) has the power to give general interpretation on questions
involving the specific application of laws and decrees in court trials. The State Council and its
ministries and commissions are also vested with the power to give interpretation of the
administrative regulations and department rules which they have promulgated. At the regional
level, the power to give interpretations of the local laws and regulations as well as
administrative rules is vested in the regional legislative and administrative organs which
promulgate such laws, regulations and rules.
THE PRC JUDICIAL SYSTEM
Under the Constitution and the PRC Law on the Organization of the People’ s Courts
(2018 revision) (ج2018ࠈࡌ)), the PRC judicial system is
made up of the Supreme People’s Court, the local people’s courts and special people’s courts.
The local people’s courts are comprised of the primary people’s courts, the intermediate
people’s courts and the higher people’s courts. The higher-level people’s courts supervise the
primary and intermediate people’s courts. The people’s procuratorates also have the right to
exercise legal supervision over the civil proceedings of people’s courts of the same level and
lower levels. The Supreme People’s Court is the highest judicial body in the PRC. It supervises
the judicial administration of the people’s courts at all levels.
The PRC Civil Procedure Law (2023 revision) (ج2023ࡌ
ࠈ)) (the “ Civil Procedure Law ”), which was adopted in 1991 and amended in 2007, 2012,
2017, 2021 and 2023, sets forth the criteria for instituting a civil action, the jurisdiction of the
people’s courts, the procedures to be followed for conducting a civil action and the procedures
for enforcement of a civil judgment or order. All parties to a civil action conducted within the
PRC must comply with the Civil Procedure Law. Generally, a civil case is initially heard by
a local court of the municipality or province in which the defendant resides. The parties to a
contract may, by express agreement, select a judicial court where civil actions may be brought,
provided that the judicial court is either the plaintiff’s or the defendant’s domicile, the place
of execution or implementation of the contract or the place of the object of the action, provided
that such choice shall not violate the requirements of the level of jurisdiction and exclusive
jurisdiction.
A foreign national or enterprise generally has the same litigation rights and obligations as
a citizen or legal person of the PRC. If a foreign country’s judicial system limits the litigation
rights of PRC citizens and enterprises, the PRC courts may apply the same limitations to the
citizens and enterprises of that foreign country within the PRC.
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– V-3 –


--- page 2014 ---
If any party to a civil action refuses to comply with a judgment or ruling made by a
people’s court or an award made by an arbitration panel in the PRC, the other party may apply
to the people’s court for the enforcement of the same. There are time limits of two years
imposed on the right to apply for such enforcement. If a person fails to satisfy a judgment made
by the court within the stipulated time, the court will, upon application by either party, enforce
the judgment in accordance with the law.
A party seeking to enforce a judgment or ruling of a people’s court against a party who
is not personally or whose property is not within the PRC may apply to a foreign court with
jurisdiction over the case for recognition and enforcement of the judgment or ruling. A foreign
judgment or ruling may also be recognized and enforced by the people’s court according to
PRC enforcement procedures if the PRC has entered into or acceded to an international treaty
with the relevant foreign country, which provides for such recognition and enforcement, or if
the judgment or ruling satisfies the court’s examination according to the principle of
reciprocity, unless the people’s court finds that the recognition or enforcement of such
judgment or ruling will result in a violation of the basic legal principles of the PRC, its
sovereignty or security or against social and public interest.
Pursuant to the Arrangements for Reciprocal Recognition and Enforcement of Judgments
in Civil and Commercial Cases between Courts of the Mainland and Hong Kong Special
Administrative Region (ʝႩ̙ձੂБ͏ਠ
τર), which came into effect on January 29, 2024, a party with an enforceable
final court judgment rendered by any designated people’s court of China or any designated
Hong Kong court requiring payment of money in a civil and commercial case according to a
written choice of court agreement, may apply for recognition and enforcement of the judgment
in the relevant people’s court of China or Hong Kong court.
THE PRC COMPANY LAW , OVERSEAS LISTING TRIAL MEASURES AND GUIDANCE
FOR ARTICLES OF ASSOCIATION
A joint stock limited company incorporated in the PRC and seeking a listing on the Stock
Exchange is mainly subject to the following laws and regulations in the PRC:
 The Company Law of the PRC () (the “ Company Law ”)
which was promulgated by the Standing Committee of the NPC on December 29,
1993, came into effect on July 1, 1994, revised on December 25, 1999, August 28,
2004, October 27, 2005, December 28, 2013 and December 29, 2023 respectively
and the latest revision of which was implemented on July 1, 2024.
 The Overseas Listing Trial Measures and five relevant guidelines which were
promulgated by the CSRC on February 17, 2023 pursuant to the PRC Securities Law
and are applicable to the direct and indirect overseas share offering or listing of
domestic companies; and
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– V-4 –


--- page 2015 ---
 The Guidelines for Articles of Association of Listed Companies (ܸ
ˏ) (the “ Guidance for Articles of Association ”) which was most recently
amended on December 15, 2023 by the CSRC. The Articles of Association are
formulated based on the Guidance for Articles of Association on a reference basis,
the summary of which is set out in the section entitled “Appendix V — Summary of
the Articles of Association” to this Prospectus.
Set out below is a summary of the major provisions of the currently effective Company
Law, the Overseas Listing Trial Measures and the Guidance for Articles of Association which
are applicable to the Company.
General
A joint stock limited company refers to an enterprise legal person incorporated in
accordance with the Company Law with its registered capital divided into shares of equal par
value. The liability of its shareholders is limited to the amount of shares held by them and the
company is liable to its creditors for an amount equal to the total value of its assets.
A joint stock limited company shall conduct its business in accordance with laws and
administrative regulations. It may invest in other limited liability companies and joint stock
limited companies and its liabilities with respect to such invested companies are limited to the
amount invested. Unless otherwise provided by laws, the joint stock limited company may not
be a contributor that undertakes joint and several liabilities for the debts of the invested
companies.
Incorporation
A joint stock limited company may be incorporated by promotion or public subscription.
A joint stock limited company may be incorporated by a minimum of one but not more
than 200 promoters, and at least half of the promoters must have residence within the PRC.
Companies incorporated by promotion are companies of which the entire registered capital is
subscribed for by the promoters. Shares in the company incorporated by promotion shall not
be offered to others unless the registered capital has been fully paid up. If laws, administrative
regulations and decisions of the State Council have separate provisions on paid-in registered
capital and the minimum registered capital, the company should follow such provisions.
For companies incorporated by way of promotion, the promoters shall subscribe in
writing for the shares required to be subscribed for by them and pay up their capital
contributions under the articles of association. Procedures relating to the transfer of titles to
non-monetary assets shall be duly completed if such assets are to be contributed as capital.
Promoters who fail to pay up their capital contributions in accordance with the foregoing
provisions shall assume default liabilities in accordance with the covenants set out in the
promoters’ agreements. After the promoters have confirmed the capital contribution under the
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– V-5 –


--- page 2016 ---
articles of association, a board of directors and a board of supervisors shall be elected and the
board of directors shall apply for registration of incorporation by filing the articles of
association with the company registration authority, and other documents as required by laws
or administrative regulations.
Where companies are incorporated by public subscription, not less than 35% of their total
number of shares must be subscribed for by the promoters, unless otherwise provided for by
laws or administrative regulations. The promoters shall preside over and convene an
inauguration meeting within thirty days from the date of the full payment of subscription
capital. The inauguration meeting shall be formed by the promoters and subscribers. Where the
shares issued are not fully subscribed for within the offer period stipulated in the share offering
prospectus, or where the promoter fails to convene an inauguration meeting within thirty days
of the subscription capital for the shares issued being fully paid up, the subscribers may
demand that the promoters refund the subscription capital so paid together with the interest
calculated at bank rates of a deposit for the same period. Within thirty days of the conclusion
of the inauguration meeting, the board of directors shall apply to the registration authority for
registration of the establishment of the company. A company is formally established and has
the status of a legal person after the registration with the relevant administration for market
regulation has been completed and a business license has been issued.
Registered Capital
The promoters may make a capital contribution in currencies, or non-monetary assets
such as in kind, intellectual property rights or land use rights which can be appraised with
monetary value and transferred lawfully, except for assets which are prohibited from being
contributed as capital by laws or administrative regulations. If a capital contribution is made
in non-monetary assets, a valuation of the assets contributed must be carried out pursuant to
the provisions of laws or administrative regulations on valuation without any over-valuation or
under-valuation.
The shares of a company are represented by stocks. A stock is a certificate issued by the
company to certify the share held by a shareholder. The stock issued by the company shall be
in the form of registered stock.
All issue of shares of a joint stock limited company shall be based on the principles of
equality and fairness. The same class of shares must carry equal rights. Shares issued at the
same time and within the same class must be issued on the same conditions and at the same
price. It may issue shares at par value or at a premium, but it may not issue shares below the
par value.
Under the Overseas Listing Trial Measures, if a domestic company offers shares overseas,
it may raise funds and dividend distributions in foreign currency or Renminbi.
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– V-6 –


--- page 2017 ---
Under the Company Law , a company issuing registered share certificates shall maintain
a shareholder registry which sets forth the following matters:
 the name and domicile of each shareholder;
 the type of shares and number of shares subscribed by each shareholder;
 the serial numbers of shares held by each shareholder; and
 the date on which each shareholder acquired the shares.
Increase of Registered Capital and Issue of Shares
In light of its operational and development needs and in accordance with laws and
regulations, a company may increase its share capital under any of the following methods,
subject to the resolutions be passed at a shareholders’ general meeting: (i) a public offering of
shares; (ii) a private placement of shares; (iii) offering of bonus shares to existing shareholders;
(iv) the conversion of reserve funds into shares; and (v) any other methods provided in law and
administrative regulations and approved by the CSRC.
Pursuant to the Company Law , a company may, according to its articles of association,
issue the following classified shares, which have different rights from those of the ordinary
shares: (i) shares with priority or inferior rights to profits or remaining property in distribution;
(ii) shares with more or less voting rights per share than those of the ordinary shares; (iii)
shares whose transfer is subject to the consent of the company and other restrictions; and (iv)
other classified shares provided by the State Council. A company making a public offering of
shares shall not issue any of the classified shares as prescribed on items (ii) and (iii), except
those issued prior to the public offering. Where a company is issuing new shares, resolutions
shall be passed at general meeting in accordance with the articles of association in respect of
the class and amount of the new shares, the issue price of the new shares, the commencement
and end dates for the issue of the new shares and when the new shares are proposed to be issued
to existing shareholders, the class and amount of such new shares.
To offer shares overseas, the domestic company shall report the application documents for
offering and listing to the CSRC for record-filing within three business days after submission
of the application documents for offering and listing overseas.
Reduction of Registered Capital
A company may reduce its registered capital in accordance with the following procedures
prescribed by the Company Law :
 the company shall prepare a balance sheet and an inventory of the assets;
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
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--- page 2018 ---
 the reduction of registered capital shall be approved by a general meeting;
 the company shall inform its creditors of the reduction in registered capital within
10 days and publish an announcement of the reduction in the newspaper within 30
days after the resolution approving the reduction has been passed;
 creditors shall within 30 days after receiving the notice, or within 45 days of the
public announcement if no notice has been received, require the company to pay its
debts or provide corresponding guarantees covering the debts;
 the company shall apply to the relevant administration of registration for the
registration of the reduction in registered capital.
Repurchase of Shares
According to the Company Law , a joint stock limited company may not purchase its
shares other than for one of the following purposes: (i) to reduce its registered capital; (ii) to
merge with another company that holds its shares; (iii) to grant its shares for carrying out an
employee stock ownership plan or equity incentive plan; (iv) to purchase its shares from
shareholders who vote against the resolution regarding the merger or division with other
companies at a general meeting; (v) to apply shares for conversion of convertible corporate
bonds issued by a listed company; and (vi) to maintain the company value and protect the
shareholders’ interests of a listed company as necessary.
Repurchase of its own shares on the grounds set out in (i) and (ii) above shall be subject
to resolution passed by the general meeting; repurchase of its own shares on the grounds set
out in (iii), (v) or (vi) above shall be subject to a resolution of the company’s board of directors
shall be made by a two-third majority of directors attending the meeting in accordance with the
provisions of the company’s articles of association or as authorized by the general meeting.
Following the repurchase of its own shares in accordance with (i) above, such shares shall
be canceled within 10 days from the date of repurchase; the shares shall be transferred or
canceled within six months if the repurchase of its own shares is in accordance with either (ii)
or (iv) above; and the shares repurchased in accordance with (iii), (v) or (vi) above shall not
exceed 10% of the company’s total issued shares, and shall be transferred or canceled within
three years.
A listed company shall perform its obligation of information disclosure according to the
provisions of the Securities Law when repurchasing its own shares. In the event the repurchase
of its own shares is in accordance with (iii), (v) or (vi) above, centralized public trading shall
be adopted.
A company shall not accept its own shares as the subject matter of a mortgage.
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
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--- page 2019 ---
Transfer of Shares
Shares held by shareholders may be transferred in accordance with the relevant laws and
regulations. Pursuant to the Company Law , transfer of shares by shareholders shall be carried
out at a legally established securities exchange or in other ways stipulated by the State Council.
Registered shares may be transferred after the shareholders endorse the back of the share
certificates or in any other manner specified by laws or administrative regulations. Following
the transfer, the company shall enter the names and addresses of the transferees into its share
register. No changes of registration in the share register described above shall be effected
during a period of twenty days prior to convening a shareholders’ general meeting or five days
prior to the record date for the purpose of determining entitlements to dividend distributions,
subject to any legal provisions on the registration of changes in the share register of listed
companies.
According to the Company law , shares issued prior to the public issuance of shares shall
not be transferred within one year from the date of the joint stock limited company’s listing on
a stock exchange. Directors, supervisors and the senior management shall declare to the
company their shareholdings in the company and any changes of such shareholdings; they shall
not transfer more than 25% of all the shares they hold in the company annually during their
tenure; and they shall not transfer the shares they hold within one year from the date on which
the company’s shares are listed and commenced trading on a stock exchange, nor within six
months after their resignation from their positions with the company.
Shareholders
According to the Company Law , the rights of holders of ordinary shares of a joint stock
limited company include:
 the right to attend or appoint a proxy to attend general meetings and to vote thereat;
 the right to transfer shares in accordance with laws, administrative regulations and
provisions of the articles of association;
 the right to inspect the company’s articles of association, share register, counterfoil
of company debentures, minutes of general meetings, resolutions of meetings of the
board of directors, resolutions of meetings of the board of supervisors and financial
and accounting reports and to make proposals or enquiries on the company’s
operations;
 the right to bring an action in the people’s court to rescind resolutions passed by
general meetings and board of directors where the articles of association is violated
by the above resolutions;
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– V-9 –


--- page 2020 ---
 the right to receive dividends and other types of interest distributed in proportion to
the number of shares held;
 in the event of the termination or liquidation of the company, the right to participate
in the distribution of residual properties of the company in proportion to the number
of shares held; and
 other rights granted by laws, administrative regulations, other regulatory documents
and the company’s articles of association.
The obligations of a shareholder include the obligation to abide by the company’s articles
of association, to pay the subscription moneys in respect of the shares subscribed for and in
accordance with the form of making capital contributions, to be liable for the company’s debts
and liabilities to the extent of the amount of his or her subscribed shares and any other
shareholders’ obligation specified in the company’s articles of association.
Shareholder’s General Meetings
The general meeting is the organ of authority of the company, which exercises its powers
in accordance with the Company Law . According to the Company Law , the general meeting
exercises the following principal powers:
 to elect or remove the directors and supervisors (other than the representative of the
employees of the company) and to decide on matters relating to the remuneration of
directors and supervisors;
 to examine and approve reports of the board of directors;
 to examine and approve reports of the board of supervisors;
 to examine and approve the company’s proposals for profit distribution plans and
loss recovery plans;
 to decide on any increase or reduction of the company’s registered capital;
 to decide on the issue of bonds by the company;
 to decide on issues such as merger, division, dissolution and liquidation of the
company and other matters;
 to amend the company’s articles of association; and
 other powers as provided for in the articles of association.
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– V-10 –


--- page 2021 ---
Annual general meeting is required to be held once every year. Extraordinary general
meeting is required to be held within two months after the occurrence of any of the following:
 the number of directors is less than the number stipulated by the law or less than two
thirds of the number specified in the articles of association;
 the aggregate losses of the company which are not recovered reach one-third of the
company’s total paid-in registered capital;
 when shareholders individually or in aggregate holding 10% or more of the
company’s shares request the convening of an extraordinary general meeting;
 whenever the board of directors deems necessary;
 when the board of supervisors so requests; or
 other circumstances as provided for in the articles of associations.
According to the Company Law , general meetings shall be convened by the board of
directors, and presided over by the chairman of the board of directors. In the event that the
chairman is incapable of performing or does not perform his/her duties, the meeting shall be
presided over by the vice chairman. In the event that the vice chairman is incapable of
performing or not performing his/her duties, a director nominated by more than half of
directors shall preside over the meeting.
Where the board of directors is incapable of performing or not performing its duties of
convening the general meeting, the board of supervisors shall convene and preside over such
meeting in a timely manner. In case the board of supervisors fails to convene and preside over
such meeting, shareholders alone or in aggregate holding more than 10% of the company’s
shares for 90 days consecutively may unilaterally convene and preside over such meeting.
According the Company Law , notice of annual general meeting shall state the time and
venue of and matters to be considered at the meeting and shall be given to all shareholders 20
days before the meeting. Notice of extraordinary general meetings shall be given to all
shareholders 15 days prior to the meeting.
There is no specific provision in the Company Law regarding the number of shareholders
constituting a quorum in a general meeting.
According to the Company Law , shareholders present at general meeting have one vote
for each share they hold, save that shares held by the company are not entitled to any voting
rights.
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– V-11 –


--- page 2022 ---
Pursuant to the provisions of the articles of association or a resolution of the general
meeting, the accumulative voting system may be adopted for the election of directors and
supervisors at the general meeting. Under the accumulative voting system, each share shall be
entitled to vote equivalent to the number of directors or supervisors to be elected at the general
meeting and shareholders may consolidate their voting rights when casting a vote.
Pursuant to the Company Law , resolutions of the general meeting shall be adopted by
more than half of the voting rights held by the shareholders present at the meeting. However,
resolutions of the general meeting regarding the following matters shall be adopted by more
than two-thirds of the voting rights held by the shareholders present at the meeting: (i)
amendments to the articles of association; (ii) the increase or decrease of registered capital;
(iii) the merger, division, dissolution, liquidation or change in the form of the company; and
(iv) other matters considered by the general meeting, by way of an ordinary resolution, to be
of a nature which may have a material impact on the company and should be adopted by a
special resolution.
According to the Company Law , meeting minutes shall be prepared in respect of decisions
on matters discussed at the general meeting. The chairman of the meeting and directors
attending the meeting shall sign to endorse such minutes. The minutes shall be kept together
with the shareholders’ attendance register and the proxy forms.
Board of Directors
According to the Company Law , a joint stock limited company shall have a board of
directors which shall have at least three members. For a company that has three hundred or
more employees, the board of directors shall include the staff representative unless the board
of supervisors has been established and already included the staff representative supervisor.
The term of a director shall be stipulated in the articles of association, provided that no term
of office shall last for more than three years. A director may serve consecutive terms if
re-elected. A director shall continue to perform his/her duties as a director in accordance with
the laws, administrative regulations and articles of association until a duly re-elected director
takes office, if re-election is not conducted in a timely manner upon the expiry of his/her term
of office, or if the resignation of directors results in the number of directors being less than the
quorum.
According to the Company Law , the board of directors mainly exercises the following
powers:
 to convene the general meetings and report on its work to the general meetings;
 to implement the resolutions passed in general meetings;
 to decide on the company’s business plans and investment proposals;
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– V-12 –


--- page 2023 ---
 to formulate the company’s profit distribution proposals and loss recovery
proposals;
 to formulate proposals for the increase or reduction of the company’s registered
capital and the issuance of corporate bonds;
 to prepare plans for the merger, division, dissolution and change in the form of the
company;
 to decide on the setup of the company’s internal management organs;
 to appoint or dismiss the company’s manager and decide on his/her remuneration
and, based on the manager’s recommendation, to appoint or dismiss any deputy
manager and financial officer of the company and to decide on their remunerations;
 to formulate the company’s basic management system; and
 to exercise any other power under the articles of association.
Meetings of the Board of Directors
According to the Company Law , the board of directors of a joint stock limited company
shall hold at least two meetings per year. The board of directors shall issue a notice of meeting
to all directors and supervisors 10 days before the meeting. Shareholders representing more
than 10% of the voting rights, more than one-third of the directors or the board of supervisors
may propose to convene an extraordinary meeting of the board of directors. The chairman of
the board of directors shall convene and preside over a meeting of the board of directors within
10 days from the receipt of the proposal. A meeting of the board of directors may only be held
if half or more of the directors are present. Resolutions of the board of directors shall be
approved by a majority of all directors. Resolutions approved by the board of directors shall
be by one person, one vote. Directors shall attend meetings of the board of directors in person.
If a director is unable to attend for any reason, he/she may appoint another director to attend
the meeting on his/her behalf by a written power of attorney specifying the scope of
authorization.
If a resolution of the board of directors violates any laws, administrative regulations or
the articles of association, and as a result of which the company sustains serious losses, the
directors participating in the resolution are liable to compensate the company. However, if it
can be proved that a director expressly objected to the resolution when the resolution was voted
on, and that such objection was recorded in the minutes of the meeting, such director shall be
relieved from that liability.
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– V-13 –


--- page 2024 ---
Chairman of the Board of Directors
Pursuant to the Company Law , the board of directors shall appoint a chairman and may
appoint a vice chairman. The chairman and the vice chairman shall be elected with approval
of more than half of all the directors. The chairman shall convene and preside over board
meetings and review the implementation of board resolutions. The vice chairman shall assist
the chairman to perform his/her duties. Where the chairman is incapable of performing or is not
performing his/her duties, the duties shall be performed by the vice chairman. Where the vice
chairman is incapable of performing or is not performing his/her duties, a director elected by
more than half of the directors shall perform his/her duties.
Qualifications of Directors
Under the Company Law , the following person may not serve as a director in a company:
 a person without capacity or restricted capacity to undertake any civil liabilities;
 a person who has been sentenced to any criminal penalty for corruption, bribery,
embezzlement, misappropriation of property or destruction of the socialist economic
order, or who has been deprived of his political rights due to his crimes and such
sentence has expired for no more than five years, or who is granted probation, if no
more than two years have passed since the expiration of the probation period;
 a person who has been a former director, factory manager or manager of a company
or an enterprise that has entered into insolvent liquidation and who was personally
liable for the insolvency of such company or enterprise, where no more than three
years have elapsed since the date of the completion of the bankruptcy and
liquidation of the company or enterprise;
 a person who has been a legal representative of a company or an enterprise that has
had its business license revoked due to violations of the law or has been ordered to
close down by law and the person was personally responsible, where less than three
years have elapsed since the date of such revocation or the order to close down; or
 a person who is listed as a dishonest person subject to enforcement by the people’s
court due to failure to pay off a large amount of unliquidated mature debts.
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– V-14 –


--- page 2025 ---
Board of Supervisors
A joint stock limited company shall have a board of supervisors composed of not less than
three members. The board of supervisors shall consist of representatives of the shareholders
and an appropriate proportion of representatives of the company’s staff, among which the
proportion of representatives of the company’s staff shall not be less than one-third, and the
actual proportion shall be determined in the articles of association. Representatives of the
company’s staff at the board of supervisors shall be democratically elected by the company’s
staff at the staff representative assembly, general staff meeting or otherwise.
Directors and senior management shall not act concurrently as supervisors.
The board of supervisors shall appoint a chairman and may appoint a vice chairman. The
chairman and the vice chairman of the board of supervisors shall be elected by more than half
of the supervisors. The chairman of the board of supervisors shall convene and preside over
board of supervisors meetings. Where the chairman of the board of supervisors is incapable of
performing or is not performing his/her duties, the vice chairman of the board of supervisors
shall convene and preside over supervisory board meetings. Where the vice chairman of the
board of supervisors is incapable of performing or is not performing his/her duties, a supervisor
nominated by more than half of the supervisors shall convene and preside over meetings of the
board of supervisors.
Each term of office of a supervisor is three years and he/she may serve consecutive terms
if re-elected. A supervisor shall continue to perform his/her duties as a supervisor in accordance
with the laws, administrative regulations and the articles of association until a duly re-elected
supervisor takes office, if re-election is not conducted in a timely manner upon the expiry of
his/her term of office or if the resignation of supervisors results in the number of supervisors
being less than the quorum. The board of supervisors meets at least once every six months. In
accordance with the Company Law , resolutions by the board of supervisors shall be passed by
a majority of all supervisors
The board of supervisors may exercise its powers:
 to review the company’s financial position;
 to supervise the directors and senior management in their performance of their
duties and to propose the removal of directors and senior management who have
violated laws, regulations, the articles of association or shareholders’ resolutions;
 when the acts of directors or senior management are detrimental to the company’s
interests, to require the director and senior management to correct these acts;
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– V-15 –


--- page 2026 ---
 to propose the convening of extraordinary shareholders’ general meetings and to
convene and preside over shareholders’ general meetings when the board of
directors fails to perform the duty of convening and presiding over shareholders’
general meetings under the PRC Company Law ;
 to submit proposals to the shareholders’ general meetings;
 to bring actions against directors and senior management pursuant to the relevant
provisions of the PRC Company Law ; and
 to exercise any other authority stipulated in the articles of association.
Supervisors may be present at board meetings and make inquiries or proposals in respect
of the resolutions of the board. The board of supervisors may investigate any irregularities
identified in the operation of the company and, when necessary, may engage an accounting firm
to assist its work at the cost of the company.
Manager and Senior Management
Pursuant to the Company Law , a company shall have a manager who shall be appointed
or removed by the board of directors. The manager shall exercise his/her powers in accordance
with the company’s articles of association or the authorization of the board of directors.
Other provisions in the articles of association on the manager’s powers shall also be
complied with. The manager shall be present at meetings of the board of directors. However,
the manager shall have no voting rights at meetings of the board of directors unless he/she
concurrently serves as a director.
Pursuant to the Company Law , senior management refers to the manager, deputy manager,
financial officer, secretary to the board of directors of a listed company and other personnel as
stipulated in the articles of association.
Duties of Directors, Supervisors and Senior Management
Directors, supervisors and senior management are required under the Company Law to
comply with the relevant laws, regulations and the articles of association, and shall be obliged
to be faithful and diligent towards the company. Where the controlling shareholder or actual
controller of the company who does not serve as a director but actually attends to the
company’s affairs, shall comply with the foregoing provisions.
Directors, supervisors and management personnel are prohibited from abusing their
authority in accepting bribes or other unlawful income and from misappropriating the
company’s property.
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– V-16 –


--- page 2027 ---
Directors, supervisors and senior management are prohibited from:
 seizing the assets of the company or misappropriating company funds;
 depositing company funds into accounts under their own names or the names of
other individuals;
 taking advantage of power to accept bribes or other illegal income;
 accepting commissions paid by a third party for transactions conducted with the
company for their own benefit;
 unauthorized divulgence of confidential information of the company; and
 other acts in violation of their duty of loyalty to the company.
Where directors, supervisors and senior management directly or indirectly conclude any
contract or engage in transactions with the company, they shall report to the board of directors
or the shareholders’ meeting and seek approval by resolutions of the board of directors or the
shareholders’ meeting in accordance with the articles of association. The requirement shall also
apply to the conclusion of contracts or engagement in transactions by close relatives of the
directors, supervisors and senior management or enterprises directly or indirectly controlled by
close relatives of the directors, supervisors and senior management as well as persons who are
otherwise related to the directors, supervisors and senior management.
Directors, supervisors and senior management shall not take advantage of duty to seek
business opportunities for themselves or others that would have been directed to the company,
unless such act has been reported to and approved by the board of directors or the shareholders’
meeting in accordance with the articles of association or the company is unable to take the
business opportunity in accordance with applicable laws, administrative regulations, and the
articles of association.
Directors, supervisors and senior management shall not engage in the business similar to
those of the company for themselves or others, unless such act has been reported to and
approved by the board of directors or the shareholders’ meeting in accordance with the articles
of association.
Income generated by directors or senior management in violation of aforementioned shall
be returned to the company.
A director, supervisor or senior management who contravenes any laws, regulations or the
company’s articles of association in the performance of his/her duties resulting in any loss to
the company shall be liable to the company for compensation.
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– V-17 –


--- page 2028 ---
The Guidance for Articles of Association provides that a company’s directors and senior
management shall have duties of diligence towards the company, for example, the directors
shall be prudent, serious and diligent in exercising the authority conferred by the company to
ensure that the business activities of the company comply with state’s laws, administrative
regulations and various economic policy requirements and that the business activities do not
go beyond the scope of business activities specified in the company’s business license; the
directors shall treat all shareholders equally; the shareholders shall keep abreast of the
company’s business management status; both the directors and the senior management shall
sign written statements confirming periodic reports of the company and ensure that the
information disclosed by the company is true, accurate and complete; both the directors and the
senior management shall provide accurate information and materials to the board of
supervisors and shall not interfere with the performance of duties by the board of supervisors
or individual supervisors; both the directors and the senior management shall have other
diligence duties prescribed by laws, administrative regulations, departmental rules and the
company’s articles of association.
Finance and Accounting
Pursuant to the Company Law , a company shall establish its own financial and accounting
systems according to the laws, administrative regulations and the regulations of the competent
financial departments of the State Council. At the end of each financial year, a company shall
prepare a financial report which shall be audited by an accounting firm in accordance with the
laws. The financial and accounting reports shall be prepared in accordance with the laws,
administrative regulations and the regulations of the financial departments of the State Council.
Pursuant to the Company Law , the company shall send the financial accounting report to
all shareholders in accordance with the period stipulated in the articles of association, and the
company’s financial accounting report shall be made available for inspection by shareholders
at least 20 days before the annual general meeting. A company that makes public stock
offerings shall publish its financial reports.
When distributing each year’s profits after taxation, the company shall set aside 10% of
its profits after taxation for the company’s statutory common reserve fund until the fund has
reached more than 50% of the company’s registered capital. When the company’s statutory
common reserve fund is not sufficient to make up for the company’s losses for the previous
years, the current year’s profits shall first be used to make good the losses before any allocation
is set aside for the statutory common reserve fund. After the company has made allocations to
the statutory common reserve fund from its profits after taxation, it may, upon passing a
resolution at a shareholders’ general meeting, make further allocations from its profits after
taxation to the discretionary common reserve fund. After the company has made good its losses
and made allocations to the abovementioned reserve fund, the remaining profits after taxation
shall be distributed in proportion to the number of shares held by the shareholders, except for
those which are not distributed in a proportionate manner as provided by the articles of
association.
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– V-18 –


--- page 2029 ---
Profits distributed to shareholders in violation of the requirements described above must
be returned to the company. The company shall not be entitled to any distribution of profits in
respect of shares held by it.
The premium over the nominal value of the shares of the company on issue and other
income as required by relevant government authorities to be treated as the capital reserve fund
shall be accounted for as the capital reserve fund. The common reserve fund of a company shall
be applied to make good the company’s losses, expand its business operations or increase its
capital. Where any losses need to be covered with reserve fund of the company, discretionary
reserve fund and statutory common reserve fund shall first be used and if still insufficient,
capital reserve fund can be used in accordance with applicable provisions. Upon the transfer
of the statutory common reserve fund into increasing capital, the balance of the statutory
common fund shall not be less than 25% of the registered capital of the company before such
transfer.
The company shall have no accounting books other than the statutory books. The
company’s capital shall not be deposited in any account opened under the name of an
individual.
Appointment and Retirement of Accounting Firm
In accordance with the Company Law , the appointment or dismissal of the accounting
firm responsible for the company’s auditing shall be determined at a shareholders’ general
meeting, by the board of directors, or by the board of supervisors, as stipulated in the articles
of association. The accounting firm should be allowed to make representations when the
shareholders’ general meeting, the board of directors, or the board of supervisors votes on its
dismissal. The company should provide true and complete accounting evidence, accounting
books, financial and accounting reports and other accounting information to the engaged
accounting firm without any refusal, withholding or falsification of information.
The Guidance for Articles of Association provides that a company shall engage an
accounting firm which is qualified with the PRC Securities Law to provide services including
the audit of financial statements, the verification of net assets and other relevant consultancy
services. The engagement term is one year and may be extended. The audit fee for the
accounting firm shall also be determined by shareholders at a general meeting.
Profit Distribution
According to the Company Law , a company shall not distribute profits before losses are
covered and the statutory common reserve fund is provided.
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– V-19 –


--- page 2030 ---
Amendments to the Articles of Association
Pursuant to the Company Law , the resolution of a shareholders’ general meeting regarding
any amendment to a company’s articles of association requires affirmative votes by more than
two-thirds of the votes held by shareholders attending the meeting.
Pursuant to the Guidance for Articles of Association , the company shall amend its articles
of association under any of the following circumstances: (i) where, after any amendment to the
PRC Company Law or any other applicable law or administrative regulation, the provisions of
the articles of association conflict with the law and/or administrative regulations amended; (ii)
where the company’s circumstances change to such an extent that they are inconsistent with
what is recorded in the articles of association; and (iii) where the shareholders’ general meeting
decides to amend the articles of association.
The Guidance for Articles of Association further provides that where any amendment to
the articles of association adopted by a shareholders’ general meeting is subject to approval by
the competent authorities, such amendment shall be submitted for approval; where any
amendment involves the company’s registration items, the company’s registration with the
authority shall also be amended. In addition, an announcement shall be made in accordance
with the applicable provisions provided that the amendment to the articles of association is
required to be disclosed by any law or regulation.
Dissolution and Liquidation
Pursuant to the Company Law , a company shall be dissolved for any of the following
reasons: (i) the term of its operation set out in the articles of association has expired or other
events of dissolution specified in the articles of association have occurred; (ii) the shareholders
have resolved at a shareholders’ general meeting to dissolve the company; (iii) the company is
dissolved by reason of its merger or division; (iv) the business license of the company is
revoked or the company is ordered to close down or to be dissolved in accordance with the
laws; or (v) the company is dissolved by a people’s court in response to the request of
shareholders holding shares that represent more than 10% of the voting rights of all
shareholders of the company, on the grounds that the operation and management of the
company has suffered serious difficulties that cannot be resolved through other means,
rendering ongoing existence of the company a cause for significant losses to the shareholders’
interests.
On the occurrence of the abovementioned events, the company shall make an
announcement on the National Enterprise Credit Information Publicity System within ten days.
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– V-20 –


--- page 2031 ---
In the event of paragraphs (i) and (ii) above, the company may carry on its existence by
amending its articles of association if no property has been distributed to any shareholder. The
amendments to the articles of association in accordance with the provisions described above
shall require the approval of more than two-thirds of voting rights of shareholders attending a
shareholders’ general meeting.
Where the company is dissolved under the circumstances set forth in paragraph (i), (ii),
(iv) or (v) above, a liquidation group shall be formed to commence the liquidation procedure
within fifteen days of the date on which the dissolution event occurs.
Where the company is dissolved under the circumstances set forth in paragraph (i), (ii),
(iv) or (v) above, the liquidation procedure shall be conducted and directors shall be the
company’s liquidation obligor and it should establish a liquidation group within fifteen days of
the date on which the dissolution event occurs. The liquidation group shall be composed of
directors or any other persons determined by a shareholders’ general meeting. If a liquidation
group is not established within the prescribed period or the liquidation fails to effect after the
establishment of a liquidation group, the interested party may file an application with a
people’s court, requesting that the court appoint relevant personnel to form a liquidation group
to administer the liquidation. The people’s court should accept such application and form a
liquidation group to conduct liquidation in a timely manner.
The liquidation group may exercise following powers during the liquidation:
 to dispose of the company’s assets and to prepare a balance sheet and an inventory
of assets;
 to notify the creditors by notice or announcement;
 to deal with and settle any outstanding business related to the liquidation;
 to pay any outstanding tax together with any tax arising during the liquidation
process;
 to settle the company’s claims and liabilities;
 to distribute the company’s remaining assets after its debts have been paid off; and
 to represent the company in any civil procedures.
The liquidation group shall notify the company’s creditors within ten days from its
establishment, and publish an announcement in newspapers or on the National Enterprise
Credit Information Publicity System within sixty days.
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– V-21 –


--- page 2032 ---
A creditor shall lodge his claim with the liquidation group within thirty days of receipt
of the notification or within forty-five days of the date of the announcement if he has not
received any notification.
A creditor shall, in making his claim, state matters relevant to his creditor’s rights and
furnish relevant evidence. The liquidation group shall register such creditor’s rights. The
liquidation group shall not make any settlement to creditors during the period of the claim.
Upon disposal of the company’s property and preparation of the required balance sheet
and inventory of assets, the liquidation group shall draw up a liquidation plan and submit this
plan to a shareholders’ general meeting or a people’s court for endorsement. The remaining
assets of the company, after payment of liquidation expenses, employee wages, social
insurance expenses and statutory compensation, outstanding taxes and the company’s debts,
shall be distributed to shareholders in proportion to shares held by them.
The company shall continue to exist during the liquidation period, although it cannot
engage in operating activities that are not related to the liquidation. The company’s property
shall not be distributed to shareholders before repayments are made in accordance with the
requirements described above.
Upon liquidation of the company’s property and preparation of the required balance sheet
and inventory of assets, if the liquidation group becomes aware that the company does not have
sufficient assets to repay its liabilities, it must apply to a people’s court for a declaration of
bankruptcy in accordance with the laws. Following such declaration by the people’s court, the
liquidation group shall hand over the administration matters to the bankruptcy administrator
designated by the people’s court.
Upon completion of the liquidation, the liquidation group shall prepare a liquidation
report and submit it to the shareholders’ general meeting or a people’s court for confirmation
of its completion, and to the company registration authority to cancel the company’s
registration, and an announcement of its termination shall be published. Members of the
liquidation group are required to discharge their duties in good faith and in compliance with
relevant laws.
Members of the liquidation group shall be prohibited from abusing their authority in
accepting bribes or other unlawful income and from misappropriating the company’s
properties. Members of the liquidation group are liable to indemnify the company and its
creditors in respect of any loss arising from their willful or material default.
Liquidation of a company declared bankrupt according to laws shall be processed in
accordance with the laws on corporate bankruptcy.
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– V-22 –


--- page 2033 ---
Overseas Listing
Pursuant to the Overseas Listing Trial Measures, both initial public offerings or listings
in overseas markets shall be filed with the CSRC within three business days after the relevant
application is submitted overseas. Subsequent securities offerings of an issuer in the same
overseas market where it has previously offered and listed securities shall be filed with the
CSRC within three business days after the offering is completed. Moreover, where the filing
documents are complete and in compliance with stipulated requirements, the CSRC will, within
twenty business days after receiving the filing documents, conclude the filing procedure and
publish the filing results on the CSRC website. Where the filing documents are incomplete or
do not conform to stipulated requirements, the CSRC shall request supplementation and
amendment thereto within five business days after receiving the filing documents. The issuer
shall then complete supplementation and amendment within thirty business days.
Loss of Share Certificates
A shareholder may, in accordance with the relevant provisions set out in the PRC Civil
Procedure Law, apply to a people’s court if his share certificate(s) in registered form is either
stolen, lost or destroyed, for a declaration that such certificate(s) will no longer be valid. After
a people’s court declares that such certificate(s) are invalid, the shareholder may apply to the
company for the issuance of a replacement certificate(s).
Merger and Demerger
Merger of companies may be conducted by absorption or consolidation. If companies
adopt the method of absorption, the absorbed company shall be dissolved. If companies are
incorporated in the form of consolidation, the parties to the merger shall be dissolved.
The parties to the merger shall enter into a merger agreement and prepare a balance sheet
and a list of properties. Within ten days of the date on which the resolution on merger is made,
the creditors shall be notified by the company and a public announcement shall be in the press
or on the National Enterprise Credit Information Publicity System within thirty days. The
creditors may require the company to repay its debts or provide guarantees for covering the
debts within thirty days of receipt of the notification or within forty-five days of the date of
the announcement if the creditor has not received any notification; and in case of a merger, the
credits and debts of the merging parties shall be assumed by the surviving or the new company.
Where a company merges with another company in which the former holds not less than
90% of the shares, the acquired company is not required to obtain approval by resolution of its
shareholders’ meeting, but shall notify the other shareholders who have the right to request the
company to buy its equities or shares as a reasonable price. If the price paid for a company’s
merger does not exceed 10% of the company’s net assets, approval by resolution of its
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– V-23 –


--- page 2034 ---
shareholder’s meeting may not be required unless otherwise provided by the company’s articles
of association. Where a company’s merger is exempt from approval by resolution of the
shareholders’ meeting in the previous two cases, it shall be subject to approval by resolution
of the board of directors.
In case of a division, the company’s assets shall be divided and a balance sheet and an
inventory of assets shall be prepared. Within ten days of the date on which the resolution on
division is made, the creditors shall be notified by the company, and a public announcement
shall be made in the press or on the National Enterprise Credit Information Publicity System
within thirty days. The liabilities of the company which have accrued prior to the division shall
be jointly borne by the separated companies, unless otherwise stipulated in the agreement in
writing entered into by the company with creditors in respect of the settlement of debts prior
to division.
Securities Laws and Regulations of PRC
The PRC has promulgated a number of regulations related to the issue and trading of
shares as well as information disclosure. In October 1992, the State Council established the
Securities Committee and the China Securities Regulatory Commission (CSRC). The
Securities Committee is responsible for coordinating the drafting of securities regulations,
formulating securities-related policies, planning the development of securities market, guiding,
coordinating and supervising all securities-related institutions in the PRC, and administering
the CSRC. The CSRC is the regulatory department of the Securities Committee, responsible for
drafting regulatory provisions for the securities market, supervising securities companies,
regulating the public offering of securities by PRC companies at home and abroad, overseeing
securities trading, compiling securities-related statistics, and conducting relevant research and
analysis. In April 1998, the State Council consolidated the two departments and reformed the
CSRC.
The Interim Provisional Regulations on the Administration of Share Issuance and Trading
covers the application and approval procedures for public offerings of equity securities, trading
of equity securities, acquisition of listed companies, custody, clearing and transfer of listed
equity securities, information disclosure, investigation, penalties of listed companies, and
dispute resolution.
On December 25, 1995, the State Council promulgated and implemented the Regulations
of the State Council Concerning Domestic Listed Foreign Shares of Joint Stock Limited
Companies (which was repealed on March 31, 2023). The provisions mainly cover the
issuance, subscription, trading and dividend declaration and other distribution of domestic
listed foreign-invested shares, as well as the information disclosure of joint stock limited
companies holding domestic listed foreign-invested shares.
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
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--- page 2035 ---
The Securities Law of the People’ s Republic of China (the “ Securities Law ”) took effect
on July 1, 1999, and was revised on August 28, 2004, October 27, 2005, June 29, 2013, August
31, 2014, and December 28, 2019, respectively. The latest revision of the Securities Law came
into effect on March 1, 2020. This is China’s first national securities law, consisting of 14
chapters and 226 articles, regulating, among other things, the issuance and trading of securities,
the acquisition by listed companies, and the obligations and responsibilities of stock
exchanges, securities companies, and the State Council’s securities regulatory authorities. The
Securities Law comprehensively regulates the activities of securities market in PRC. Article
224 of the Securities Law stipulates that domestic enterprises shall comply with relevant
regulations of the State Council to list their shares outside the PRC. Currently, the issuance and
trading of foreign-issued shares (including H shares) are mainly governed by the rules and
regulations promulgated by the State Council and the CSRC.
On November 14, 2019, the CSRC issued the Guidance for the Application for the “Full
Circulation” of Domestic Unlisted Shares of H-Share Companies , which was partially revised
on August 10, 2023 in accordance with the Decision on Revising and Abolishing Part of
Securities and Futures Policy Documents by CSRC . The guideline aims to regulate the listing
and circulation of unlisted domestic shares (including unlisted domestic shares held by
domestic shareholders prior to overseas listing, unlisted domestic shares issued in China after
overseas listing, and unlisted shares held by foreign shareholders) of joint-stock limited
companies listed on the Hong Kong Stock Exchange (hereinafter referred to as H-Share
Companies) (hereinafter referred to as “ Full Circulation ”).
Unlisted domestic joint-stock companies may submit an application for “Full Circulation”
when applying for overseas initial public offering and listing.
Arbitration and Enforcement of Arbitral Awards
On August 31, 1994, the SCNPC passed the Arbitration Law of the People’ s Republic of
China (the “ Arbitration Law ”), which came into effect on September 1, 1995, and was
amended on August 27, 2009, and September 1, 2017. According to the Arbitration Law, an
arbitration committee may, before the China Arbitration Association promulgates arbitration
rules, formulate interim arbitration rules in accordance with the Arbitration Law and the Civil
Procedure Law. Where the parties have by agreement provided arbitration as the method for
dispute resolution, the people’s court will refuse to accept the case, unless the arbitration
agreement is deemed invalid.
Where a dispute or claim of rights referred to in the preceding paragraph is referred to
arbitration, the entire claim or dispute must be referred to arbitration, and all persons who have
a cause of action based on the same facts giving rise to the dispute or claim or whose
participation is necessary for the resolution of such dispute or claim, must comply with the
arbitration. Disputes over the definition of shareholders and disputes over the issuer’s register
of shareholders need not be resolved by arbitration.
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
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--- page 2036 ---
A claimant may elect for arbitration to be carried out at either the China International
Economic and Trade Arbitration Commission (“ CIETAC ”) in accordance with its arbitration
rules, or at the Hong Kong International Arbitration Centre (“ HKIAC ”) in accordance with its
Securities Arbitration Rules (the “ Securities Arbitration Rules ”). Once a claimant refers a
dispute or claim to arbitration, the other party shall submit to the arbitral body elected by the
claimant. If the claimant elects for arbitration to be carried out at the HKIAC, any party to the
dispute or claim may apply for a hearing to take place in Shenzhen in accordance with the
Securities Arbitration Rules. According to the CIETAC Arbitration Rules which was amended
on September 2, 2023 and implemented on January 1, 2024, CIETAC shall deal with economic
and trading disputes over contractual or non-contractual transactions based on the agreement
of the parties, including disputes involving Hong Kong based on the agreement of the parties.
The CIETAC is established in Beijing and its branches and centers have been set up in
Shenzhen, Shanghai, Tianjin, Chongqing, Zhejiang, Hubei, Fujian, Shanxi, Jiangsu, Sichuan,
and Shandong.
Under the Arbitration Law and the Civil Procedure Law, an arbitral award is final and
binding on the parties to the arbitration. If a party to the arbitration fails to comply with an
arbitral award, the other party to the award may apply to the people’s court for its enforcement.
A people’s court may refuse to enforce an arbitral award made by an arbitration commission
if there is any irregularity on the procedures or composition of arbitrators specified by law, or
if the award exceeds the scope of the arbitration agreement or is outside the jurisdiction of the
arbitration commission.
A party seeking to enforce an arbitral award of a PRC arbitration tribunal against a party
who, or whose property, is not within the PRC, may apply to a foreign court with jurisdiction
over the case for enforcement. Similarly, an arbitral award made by a foreign arbitral body may
be recognized and enforced by the PRC courts in accordance with the principle of reciprocity
or any international treaty concluded or acceded to by the PRC. The PRC has acceded to the
Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the “ New Y ork
Convention ”) adopted on June 10, 1958, pursuant to a resolution of the SCNPC passed on
December 2, 1986. The New Y ork Convention provides that all arbitral awards made in a state
which is a party to the New Y ork Convention shall be recognized and enforced by other parties
thereto, subject to their rights to refuse enforcement under certain circumstances, including
where the enforcement of the arbitral award is against the public policy of that state. It was
declared by the SCNPC simultaneously with the accession of the PRC that (i) the PRC will
only recognize and enforce foreign arbitral awards on the principle of reciprocity and (ii) the
PRC will only apply the New Y ork Convention in disputes considered under PRC laws to arise
from contractual and non-contractual mercantile legal relations.
An arrangement was reached between Hong Kong and the Supreme People’s Court for the
mutual enforcement of arbitral awards. On June 18, 1999, the Supreme People’s Court adopted
the Arrangement Concerning Mutual Enforcement of Arbitral Awards between the Mainland
and the Hong Kong Special Administrative Region , which took effect on February 1, 2000. The
above arrangement was amended by the Supplemental Arrangement Concerning the Mutual
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– V-26 –


--- page 2037 ---
Enforcement of Arbitral Awards between the Mainland and the Hong Kong Special
Administrative Region , which was adopted by the Supreme People’s Court and took effect on
November 27, 2020. In accordance with this arrangement, awards made by mainland arbitral
authorities under the Arbitration Law can be enforced in Hong Kong, and Hong Kong arbitral
awards are also enforceable in the mainland.
Judicial Judgement and Its Enforcement
On January 14, 2019, the Judicial Committee of the Supreme People’s Court adopted the
Arrangement on Reciprocal Recognition and Enforcement of Judgments in Civil and
Commercial Matters by the Courts of the Mainland and of the Hong Kong Special
Administrative Region , which came into effect on January 29, 2024 and seeks to establish a
mechanism with greater clarity and certainty for recognition and enforcement of judgements in
wider range of civil and commercial matters between Hong Kong and the mainland China. The
arrangement discontinued the requirement for a choice of court agreement for bilateral
recognition and enforcement. The arrangement further stipulates, among others, the scope and
particulars of judgments, the procedures and methods of the application for recognition and
enforcement, the review of the jurisdiction of the court that issued the original judgement, the
circumstances where the recognition and enforcement of judgement shall be refused, and the
approaches towards remedies for the reciprocal recognition and enforcement of judgements in
civil and commercial matters between the courts in Mainland China and those in Hong Kong.
Upon implementation of this arrangement, the Arrangement on Reciprocal Recognition and
Enforcement of Judgments in Civil and Commercial Matters by the Courts of the Mainland and
of the Hong Kong Special Administrative Region Pursuant to Choice of Court Agreements
between Parties Concerned , adopted by the Judicial Committee of the Supreme People’s Court
on June 12, 2006 and effective from August 1, 2008, has been repealed.
APPENDIX V SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– V-27 –


--- page 2038 ---
This Appendix contains a summary of major provisions of the Articles of Association.
This Appendix mainly provides potential investors with an overview on the Articles of
Association. As it is only a summary, it does not contain all the information that may be
important to potential investors.
SHARES AND REGISTERED SHARE CAPITAL
The Company’s shares shall be in the form of share certificates.
The issuance of the shares of the Company shall be conducted in the principle of
openness, fairness and justness, and each share of the same class shall be entitled to equal
rights.
For shares issued at the same time and within the same class, it shall be issued in the same
conditions and price; and the price paid by any organization or individual for each share shall
be the same.
INCREASE/DECREASE, REPURCHASE AND TRANSFER OF SHARES
Increase/Decrease of Shares
The Company may, based on its operating and development needs and in accordance with
laws and regulations and the resolution of any general meeting, increase its registered capital
by the following methods:
(i) a public offering of shares upon approval by the securities regulatory authority in the
place where the shares of the Company are listed;
(ii) a private issuance of shares;
(iii) offering of bonus shares to existing shareholders;
(iv) the conversion of reserve funds into share capital;
(v) placement of new shares to existing shareholders; and
(vi) any other methods provided in laws and administrative regulations and approved by
the securities regulatory authorities in the place where the shares of the Company
are listed.
The Company may reduce its registered capital. If the Company reduces its registered
capital, it shall do so by the procedures set forth in the Company Law and other related
requirements and the Articles of Association.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-1 –


--- page 2039 ---
Repurchase of Shares
In accordance with applicable laws, administrative regulations, regulations of the
authorities and the Articles of Association, the Company shall not purchase its own shares other
than in any of the following circumstances:
(i) reducing its registered capital;
(ii) merging with another company which holds shares in the Company;
(iii) utilizing the shares for employee stock ownership plan or equity incentive plan;
(iv) acquiring its own shares at the request of its shareholders who vote at general
meeting against a resolution regarding a merger or separation;
(v) utilizing the shares for conversion of corporate bonds which are convertible into
shares issued by a listed company;
(vi) maintaining corporate value and shareholders’ interests by the Company as and
when necessary;
(vii) such other circumstances as permitted by laws and administrative regulations.
The Company may repurchase its shares by an open centralized transaction method or
other methods as permitted by laws and regulations, the CSCR and the securities regulatory
authorities and the other securities exchange(s) in the place where the shares of the Company
are listed, subject to compliance with the requirements prescribed by applicable laws,
administrative regulations, regulations of the authorities and securities regulatory rules of the
place where the shares of Company are listed.
The Company’s repurchase of its own shares under the circumstance as stipulated in items
(iii), (v) or (vi) of the preceding paragraph shall be conducted by an open centralized
transaction method.
The Company’s purchase of its own shares under the circumstance as stipulated in items
(i) and (ii) of the preceding paragraph shall be subject to a resolution of the general meeting;
the Company’s purchase of its own shares under the circumstance as stipulated in items (iii),
(v) or (vi) of the preceding paragraph may be subject to a resolution of the meeting of the Board
of Directors with more than two thirds of Directors present, subject to compliance with the
securities regulatory rules of the place where the shares of the Company are listed.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-2 –


--- page 2040 ---
The shares acquired by the Company under the circumstance stipulated in item (i) hereof
shall be cancelled within ten days upon the date of acquisition of shares; the shares shall be
transferred or cancelled within six months if the repurchase of shares is made under the
circumstances stipulated in either item (ii) or (iv); and the shares held in total by the Company
after the repurchase under any of the circumstances stipulated in item (iii), (v) or (vi) shall not
exceed 10% of the Company’s total issued shares, and shall be transferred or cancelled within
three years.
Transfer of Shares
The shares of the Company held by promoters shall not be transferred within one year of
the establishment of the Company. Shares issued prior to the public issuance of shares by the
Company shall not be transferred within one year from the date the shares of the Company
were listed and traded at the stock exchange.
Directors, Supervisors and the senior management members of the Company shall declare
to the Company their shareholdings in the Company and any changes of such shareholdings;
they shall not transfer more than 25% of the total shares they hold in the Company annually
during their tenure; and they shall not transfer the shares they held within one year from the
date on which the Company’s shares are listed and traded at the stock exchange, nor within six
months after their resignation from their positions with the Company.
If a Director, Supervisor or senior management member of the Company, or a shareholder
holding more than 5% of the shares sells the shares of the Company or other securities with
the nature of equity within six months after buying those shares, or buys the shares within six
months after selling those shares, all the gains arising thereof shall belong to the Company, and
such gains shall be collected by the Board of Directors of the Company. However, the
following circumstances shall be excluded where a securities company underwrites unsold
shares, thereby holding more than 5% of the shares or where the provisions of the CSRC are
applicable. If listing rules of the stock exchange of the place(s) where the shares of the
Company are listed provide otherwise on restrictions on transfers of shares, such rules shall
prevail.
Shareholders and the General Meetings
Shareholders
The Company shall keep a register of shareholders according to the evidence provided by
the share registrars. The register of shareholders shall be the sufficient evidence of the
shareholders’ shareholding in the Company. The original register of holders of H shares shall
be maintained in Hong Kong and made available for shareholders’ inspection, but the Company
may suspend the registration of shareholders in accordance with applicable laws and
regulations and the requirements of the securities regulatory rules of the place where the shares
of the Company are listed. Shareholders have rights and assume obligations in proportion to
the class of shares they hold; Shareholders who hold the same class of shares shall enjoy equal
rights and assume the same obligations.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-3 –


--- page 2041 ---
The shareholders of the Company shall be entitled to the following rights:
(i) to be entitled to dividends and other forms of distribution in proportion to the
number of shares held;
(ii) the right to propose, convene and preside over, to attend or appoint a proxy to attend
general meetings and to exercise the corresponding voting rights in accordance with
laws, unless individual shareholders are required by the securities regulatory rules
of the place where the shares are listed or applicable laws and regulations to abstain
from voting on individual matters;
(iii) to supervise and manage the business activities of the Company and to put forward
proposals or raise inquiries;
(iv) to transfer, donate, or pledge shares held by them in accordance with the laws,
administrative regulations and provisions of the Articles of Association;
(v) to review the Articles of Association, the register of shareholders, corporate bond
stubs, minutes of general meeting, resolutions of the Board of Directors, resolutions
of the Supervisory Committee and financial and accounting reports;
(vi) upon termination or liquidation of the Company, to participate in the distribution of
remaining assets of the Company in accordance with the number of shares held;
(vii) with respect to shareholders who vote against any resolution adopted at the general
meeting on the merger or division of the Company, to require the Company to
acquire the shares held by them;
(viii) other rights conferred by laws, administrative regulations, regulations of the
authorities, the securities regulatory rules of the place where the shares of the
Company are listed and the Articles of Association.
If the procedures for convening, or the method of voting at a general meeting or the Board
of Directors are in breach of laws, administrative regulations and the Articles of Association,
or the content of a resolution violates the Articles of Association, shareholders shall have the
right to petition the People’s Court to revoke the resolution within 60 days from the date of the
adoption of such resolution.
The shareholders of the Company shall assume the following obligations:
(i) to abide by laws, administrative regulations and the Articles of Association;
(ii) to pay subscription monies according to the number of shares subscribed and the
method of subscription;
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-4 –


--- page 2042 ---
(iii) not to surrender the shares unless required by the laws and regulations;
(iv) not to abuse the shareholder’s rights so as to damage the interests of the Company
or those of any other shareholders; not to abuse the independent legal person status
of the Company and the limited liability owed by the shareholders so as to damage
the interests of the Company’s creditors;
(v) other obligations imposed by laws, administrative regulations and the Articles of
Association.
Where shareholders of the Company abuse their shareholders’ rights and thereby causing
loss to the Company or other shareholders, such shareholders shall be liable for indemnity in
accordance with laws.
Where shareholders of the Company abuse the Company’s status as an independent legal
entity and the limited liability owed by the shareholders for the purposes of evading from
making debt repayments, thereby materially impairing the interests of the creditors of the
Company, such shareholders shall be jointly and severally liable for the debts owed by the
Company.
General Provisions on the General Meetings
The general meetings shall be the organ of power of the Company and shall exercise the
following duties and powers according to laws:
(i) to decide on the operating guidelines and investment plans of the Company;
(ii) to elect and replace the Directors and Supervisors which are not appointed as
representatives of the employees, and to decide on the remuneration of the relevant
Directors and Supervisors;
(iii) to consider and approve reports of the Board of Directors;
(iv) to consider and approve reports of the Supervisory Committee;
(v) to consider and approve the Company’s annual financial budgets and final accounts;
(vi) to consider and approve the Company’s profit distribution plans and plans for
making up losses;
(vii) to consider and approve adjustment or change to the Company’s profit distribution
policy;
(viii) to decide on increases or reductions in the Company’s registered capital;
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-5 –


--- page 2043 ---
(ix) to make resolution on the issuance of corporate bonds;
(x) to make resolutions on the merger, demerger, spin-off, liquidation or change of
corporate form of the Company;
(xi) to amend the Articles of Association;
(xii) to make resolutions on the issue of appointment, dismissal or non-reappointment of
accounting firms;
(xiii) to examine and approve the guarantee issues as prescribed in Article 44 of the
Articles of Association;
(xiv) to consider any matters on the acquisition or disposal of a substantial assets during
a year, which involves an amount exceeding 30% of the latest audited total assets of
the Company for the most recent period;
(xv) to examine and approve matters relating to the change of purpose of raised fund;
(xvi) To examine equity incentive plan and employee stock ownership plan;
(xvii) to examine the connected transactions between the Company and connected parties
(except for the Company’s provision of guarantees, donated cash assets, and debts
that are simply reduced or exempted from the obligations of the listed company)
exceeds RMB30 million and represents more than 5% of the absolute value of the
Company’s latest audited net assets, and other connected transactions subject to the
general meeting for deliberation in accordance with the securities regulatory rules of
the place where the shares of the Company are listed;
(xviii) to examine the proposals of the shareholders, individually or in the aggregate,
holding 3% or more of the voting shares of the Company;
(xix) to examine other matters required by laws, administrative regulations, regulations of
the authorities, securities regulatory rules of the place where the shares of the
Company are listed and the Articles of Association, to be resolved by the general
meeting.
The following external guarantees of the Company shall be considered and approved by
the general meeting:
(i) any single guarantee of which the amount exceeds 10% of the audited net assets for
the latest financial year;
(ii) any guarantee provided after the total amount of the external guarantees provided by
the Company and its subsidiaries reaches or exceeds 50% of the audited net assets
for the latest financial year;
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
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--- page 2044 ---
(iii) any guarantee provided after the total amount of the external guarantees provided by
the Company and its subsidiaries exceeds 30% of the audited total assets for the
latest financial year;
(iv) any guarantee whose amount exceeds 30% of the Company’s latest total audited
assets according to the principle of cumulative calculation of guarantee amount for
12 consecutive months;
(v) any guarantee provided to the guaranteed object with a debt-to-asset ratio of more
than 70% as indicated by the data in the latest financial statements;
(vi) any guarantee provided to shareholders, actual controllers and their related parties;
and
(vii) any other guarantees provided by laws, administrative regulations, rules and
regulations, securities regulatory rules of the place where the shares of the Company
are listed or other regulatory documents or the Articles of Association.
For guarantee matters within the scope of authorization of the Board of Directors, in
addition to the approval of more than half of all Directors, the approval of over two-thirds of
the Directors present at the meeting of the Board of Directors shall be required. The guarantee
set out in item (iv) above shall be approved by more than two thirds of voting rights held by
shareholders present at the meeting.
Shareholders’ general meetings include annual general meetings and extraordinary
general meetings. The annual general meeting shall be held once every year within six months
after the end of the previous accounting year.
The Company shall hold an extraordinary general meeting within two months from the
date of occurrence of any of the following circumstances:
(i) the number of Directors is less than that prescribed by the Company Law or less than
the two thirds of the amount required by the Articles of Association;
(ii) the uncovered losses are in excess of one-third of the Company’s total paid-in share
capital;
(iii) shareholders individually or collectively holding 10% (including 10%) of the
Company’s shares request in writing;
(iv) the Board of Directors considers it necessary;
(v) the Supervisory Committee proposes to hold such a meeting;
(vi) more than two independent Directors propose to convene the meeting;
(vii) such other circumstances as provided for by laws, administrative regulations,
regulations of the authorities, securities regulatory rules of the place where the
shares of the Company are listed and the Articles of Association.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-7 –


--- page 2045 ---
Convening of the General Meetings
Independent Directors shall have the right to propose to the Board of Directors to convene
extraordinary general meetings. When an independent Director proposes to convene an
extraordinary general meeting, the Board of Directors shall issue written feedback on consent
or non-consent to the convening of the extraordinary general meeting within 10 days from the
receipt of the proposal according to the laws, administrative regulations and the Articles of
Association. If the Board of Directors gives consent to convene an extraordinary general
meeting, it shall, within five days from the passing of the Board of Directors resolution, issue
a notice on convening the general meetings. If the Board of Directors does not give consent to
convene an extraordinary general meeting, the Board of Directors shall state the reason and
issue an announcement.
The Supervisory Committee shall have the right to propose the convening of
extraordinary general meetings and submit such proposal in writing to the Board of Directors.
In accordance with the laws, administrative regulations and the Articles of Association, the
Board of Directors shall issue written feedback on consent or non-consent to the convening of
the extraordinary general meetings within 10 days from the receipt of the proposal. If the Board
of Directors gives consent to convene an extraordinary general meeting, it shall, within five
days from the passing of the Board of Directors resolution, issue a notice on convening the
general meetings. Any changes to the original proposal in the notice shall obtain the consent
of the Supervisory Committee. If the Board of Directors does not give consent to convene an
extraordinary general meeting or does not issue feedback within 10 days from the receipt of the
proposal, the Board of Directors shall be deemed as unable to perform or failed to perform the
duties of convening a general meeting. In such cases, the Supervisory Committee may proceed
to convene and chair the meeting on its own.
Shareholders that, either individually or jointly, hold over 10% of shares of the Company
have the right to propose to the Board of Directors for the convening of an extraordinary
general meeting, and such proposal shall be made in writing to the Board of Directors and
explain the topic of the meeting. The Board of Directors shall, in accordance with laws,
administrative regulations, and the Articles of Association, provide a written feedback within
10 days after receiving the proposal with respect to whether it agrees with the proposal to
convene an extraordinary general meeting. In event that the Board of Directors agrees to
convene an extraordinary general meeting, a notice of the general meeting shall be provided
within five days of such resolution by the Board of Directors. Alterations to the original
proposals in the notice shall be approved by the relevant shareholders. In the event that the
Board of Directors disagrees with the convening of an extraordinary general meeting, or fails
to provide any feedback within 10 days after receiving the proposal, shareholders that, either
individually or jointly, hold over 10% of shares of the Company have the right to propose to
the Supervisory Committee for the convening of an extraordinary general meeting, and such
proposal shall be made in writing to the Supervisory Committee. In event that the Supervisory
Committee agrees to convene an extraordinary general meeting, a notice of the general meeting
shall be issued within five days of receipt of such request. Alterations to the original proposals
in the notice shall be approved by the relevant shareholders. In event that the Supervisory
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-8 –


--- page 2046 ---
Committee did not provide a notice of the general meeting within the specified timeframe, the
Supervisory Committee shall be considered to be unwilling to convene and preside over the
general meeting. The shareholders that, either individually or jointly, hold over 10% of shares
of the Company for a period of 90 consecutive days or more may at their sole discretion
convene and preside over the extraordinary general meeting.
Where the Supervisory Committee or shareholders decide to convene a general meeting
on its/their own, it/they shall notify the Board of Directors in writing and file relevant
evidential documents with the Shanghai Stock Exchange. The Shareholders who convene the
general meeting shall hold no less than 10% shares of the Company when any resolution is
made at such meeting. The Supervisory Committee or the convening shareholders shall, when
the notice of general meeting or announcement of resolutions of general meeting is issued,
submit relevant evidential documents to the authority appointed by CSRC in the location of the
Company and the Shanghai Stock Exchange.
For the general meetings convened by the Supervisory Committee or shareholders, the
Board of Directors and the secretary of the Board of Directors shall cooperate. The Board of
Directors shall provide the register of shareholders as at the date of record. Where the Board
of Directors fails to provide the register of shareholders, the convener(s) may apply to the
securities registration and clearing institution for such a register of shareholders with the
announcement relating to the notice of convening the general meeting. The register of
shareholders obtained by the convener shall not be used for any purpose other than convening
a general meeting.
Proposals and Notices of the General Meeting
The contents of the general meeting proposals shall be within the scope of powers of the
general meeting and such proposals shall have precise agenda and specific matters to be
resolved, and be in compliance with the relevant provisions of laws, administrative regulations
and securities regulatory rules of the place where the shares of the Company are listed and the
Articles of Association.
As a general meeting is convened, the Board of Directors, Supervisory Committee and
any of the shareholders individually or jointly holding more than 3% of the shares of the
Company may propose any resolution to the Company. Any of the shareholders individually or
jointly holding more than 3% of the shares of the Company may submit an interim proposal
in writing to the convener at least 10 days prior to the convention of the general meeting. If
the proposal meets the requirements of Article 54 of the Articles of Association, the convener
shall issue a supplemental notice to the general meeting within two days upon receipt of such
proposal and announce the contents of the extraordinary resolution. If, according to the
securities regulatory rules of the place where the shares of the Company are listed, the general
meeting needs to be postponed due to the publication of a supplementary notice of the general
meeting, the convening of the general meeting shall be postponed in accordance with the
securities regulatory rules of the place where the shares of the Company are listed.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-9 –


--- page 2047 ---
The convener shall notify all shareholders in writing (including announcement) 21 days
prior to the annual general meeting, and 15 days prior to an extraordinary general meeting.
When calculating the interval between the notice of the general meeting and the date of the
meeting, it should not include the day of the meeting, but include the day the notice is issued.
The notice of the general meeting shall contain the following details:
(i) the time, venue and duration of the meeting;
(ii) matters and proposals to be considered at the meeting;
(iii) contain a conspicuous statement that all shareholders are entitled to attend the
general meeting and may appoint a proxy in writing to attend and vote on his/her
behalf at the meeting, and that a proxy need not be a shareholder of the Company;
(iv) the date of registration of equity entitlements for shareholders entitled to attend the
general meeting;
(v) it shall contain the names and telephone numbers of permanent contact persons for
the affairs of the meeting;
(vi) the time and procedures for voting online or by other means;
(vii) other requirements stipulated by laws, administrative regulations, departmental
regulations, securities regulatory rules of the place where the shares of the Company
are listed and the Articles of Association.
The notice of the general meeting and its supplementary notice shall include other matters
prescribed by securities regulatory rules of the place where the shares of the Company are
listed or the Articles of Association and shall fully and completely disclose the specific
contents of all proposals. If any matter to be discussed requires opinions of the independent
Directors, the opinions and reasons of the independent Directors shall be disclosed together
with the issuance of such notice and its supplementary notice.
Holding of the General Meeting
Any shareholder in the register of shareholders on the record date or his proxy shall be
entitled to attend the general meeting, and have the right to vote pursuant to the laws,
regulations, and the Articles of Association. Shareholders can attend the general meeting in
person or appoint proxies to attend and vote on their behalf. Such proxy needs not necessarily
be a shareholder of the Company.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-10 –


--- page 2048 ---
Individual shareholders attending the meeting in person shall present their identity cards
or other valid documents or certificates, or stock account cards as a proof of their identities.
Proxies attending the meeting on behalf of shareholders shall present their valid identity cards
and power of attorney.
A corporate shareholder shall attend the meeting by its legal representative or by proxies
appointed by the legal representative. The legal representative present at the meeting shall
produce his/her identity card and valid proof showing his/her status, and the proxy present at
the meeting shall present his/her identity card and the power of attorney in writing issued by
the legal representative in accordance with laws, except for shareholders who are recognized
clearing houses and their nominees as defined by relevant regulations or securities regulatory
rules of the place where the shares of the Company are listed, which may come into effect from
time to time under Hong Kong laws.
The power of attorney issued by a shareholder to appoint a proxy to attend general
meeting shall specify:
(i) the name of the proxy;
(ii) whether or not the proxy has any voting right;
(iii) directive to vote for or against or abstain from voting on each and every issue
included in the agenda of the general meeting;
(iv) the date of issue and validity period of the power of attorney;
(v) signature (or seal) of the principal; If the principal is a corporate shareholder, it shall
be stamped with the seal of the legal person or signed by a legally authorized person.
Any form issued to a shareholder by the Board of Directors for use by him for appointing
a proxy shall allow the shareholder to freely instruct the proxy to vote in favour of or against
each resolution and to give instructions on the matters to be voted on in respect of each
question at the meeting. Such form shall contain a statement that, in the absence of instructions
by the shareholder, his proxy may vote as he thinks fit.
If the power of attorney for voting by proxy is signed by the authorized person of the
principal, the power of attorney for signing or other authorization documents shall be
notarized. The notarized the power of attorney or other authorization documents and the power
of attorney for voting by proxy shall be placed at the domicile of the Company or other place
specified in the meeting.
If the principal is a legal person, its legal representative or the person authorized by the
Board of Directors or other decision-making authorities shall attend the general meeting of the
Company as a representative.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-11 –


--- page 2049 ---
If a shareholder is recognized as a clearing house (or its nominee), the shareholder is
entitled to authorize one or more person(s), as it thinks fit, to act as its proxy at any general
meeting or creditors’ meeting. However, if more than one person is authorized, the power of
attorney shall set out the number and class of shares represented by each of the persons so
authorized. The power of attorney shall be signed by the authorized personnel of the
recognized clearing house. A person so authorized may exercise rights (without presenting any
share certificate, notarized authorization and/or other evidence indicating that he/she has been
duly authorized), and must have the same legal rights as other shareholders, including the right
to speak and vote, on behalf of the recognized clearing house (or its nominee), as if he/she was
an individual shareholder of the Company.
When a general meeting is convened, the Directors, Supervisors and the secretary to the
Board of Directors of the Company shall attend the meeting, and the President and other senior
management members shall be present at the meeting. Subject to the securities regulatory rules
of the place where the shares of the Company are listed, the aforementioned persons may attend
or be present at the meeting via internet, video, telephone or other means with equivalent
effect.
Shareholders’ general meetings shall be convened by the Board of Directors in
accordance with laws, and the general meeting shall be presided over by Chairman of the Board
of Directors. Where the Chairman of the Board of Directors is unable or fails to perform the
duty, the meeting shall be presided over by a Co-Chairman (if any) jointly elected by a simple
majority of the Directors if the Company has two or more Co-Chairmen; When Co-Chairman
of the Board of Directors is unable or fails to perform the duty, the meeting shall be presided
over by the Deputy Chairman (if any) jointly elected by a simple majority of the Directors if
the Company has two or more Deputy Chairmen. Where the Deputy Chairman of the Board of
Directors is unable or fails to perform the duty, a Director jointly elected by more than half of
the Directors will preside over the meeting. A general shareholders’ meeting convened by the
Supervisory Committee itself shall be presided over by the Chairman of the Supervisory
Committee. Where the Chairman of the Supervisory Committee is unable or fails to perform
the duty, the Deputy Chairman of the Supervisory Committee (if any) shall preside over the
meeting, and when the Deputy Chairman of the Supervisory Committee is unable or fails to
perform the duty, a Supervisor jointly elected by more than half of the Supervisors shall preside
over the meeting. A general meeting convened by the shareholders themselves shall be presided
over by a representative elected by the conveners. If, for any reason, the conveners are unable
to elect a representative as a presider to preside over the meeting, the shareholders holding the
most voting shares among the conveners (including proxies) shall act as the presider to preside
over the meeting.
In the event that the general meeting cannot proceed due to violation of the rules of
procedure by the presider of the meeting, the general meeting may appoint one person as the
presider of the meeting upon consent of a simple majority of the voting shareholders present
at the meeting and continue the meeting.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-12 –


--- page 2050 ---
Voting of the General Meeting
Resolutions of the general meeting shall be divided into ordinary resolutions and special
resolutions. An ordinary resolution must be passed by votes representing a simple majority of
the voting rights represented by the shareholders (including proxies) present at the meeting. A
special resolution must be passed by votes representing more than two-thirds of the voting
rights represented by the shareholders (including proxies) present at the meeting.
The following matters shall be resolved by an ordinary resolution at a general meeting:
(i) the work report of the Board of Directors and the Supervisory Committee;
(ii) the profit distribution plan and plan for covering losses formulated by the Board of
Directors;
(iii) the connected transaction matters subject to the general meeting for deliberation;
(iv) the election and removal of members of the Board of Directors and the Supervisory
Committee and their remunerations and the method of payment thereof;
(v) the Company’s annual financial budgets and final accounts plans;
(vi) make resolutions on the engagement, re-engagement or dismissal of the accounting
firm or the remuneration of the accounting firm by the Company;
(vii) the annual reports of the Company;
(viii) other matters requiring approval by special resolutions in accordance with laws,
administrative regulations, requirements of the securities regulatory rules of the
place where the shares of the Company are listed or the Articles of Association.
The following matters shall be resolved by a special resolution at a general meeting:
(i) increase or reduction in the registered capital of the Company and issue any type of
shares, warrants, and other similar securities;
(ii) issuance of corporate bonds;
(iii) division, merger, change of the corporate form, dissolution and liquidation of the
Company (including voluntary liquidation of the Company);
(iv) amendments to the Articles of Association;
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-13 –


--- page 2051 ---
(v) any purchase or disposal of substantial assets made or guarantee provided by the
Company within one year, the amount of which exceeds 30% of the latest audited
total assets of the Company;
(vi) adjustment or amendment of profit distribution policy;
(vii) repurchase of shares of the Company;
(viii) equity incentive plan;
(ix) any other matters as required by laws, administrative regulations, securities
regulatory rules of the place where the shares of the Company are listed or the
Articles of Association and matters which, if resolved by way of an ordinary
resolution at a general meeting, will have a material impact on the Company and
need be adopted by way of special resolutions.
A shareholder (including proxies) when voting at a general meeting may exercise voting
rights in accordance with the number of shares carrying the right to vote. Each share shall have
one voting right.
For significant matters to be decided in general meetings that would affect the interests
of medium and small investors, the votes by medium and small investors shall be counted
separately. The result of such separate vote counting shall be timely disclosed.
The shares of the Company held by itself have no voting rights and shall not be counted
into the total number of shares carrying voting rights at the general meeting.
If a shareholder purchases the shares of the Company with voting rights in violation of
the provisions of paragraphs 1 and 2 of Article 63 of the Securities Law, the voting rights of
shares exceeding the prescribed proportion shall not be exercised within 36 months after the
purchase, and shall not be counted into the total number of shares carrying voting rights at the
general meeting.
If any shareholders should give up the voting right for certain proposal or are restricted
to be only able to vote for or against certain proposal in accordance with the provisions of
applicable laws and regulations and the Hong Kong Listing Rules, the votes by those
shareholders or their representatives shall not be counted in case of any violation of the
relevant provisions or restriction.
The Board of Directors of the Company, independent Directors, shareholders holding
more than one percent of the shares with voting rights or investor protection institutions
established according to laws, administrative regulations or provisions of the CSRC may
publicly solicit voting rights from the shareholders. Such information as the specific vote
intention shall be sufficiently disclosed to the solicited persons in respect of solicitation of the
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-14 –


--- page 2052 ---
shareholders’ right to vote. It is not permitted to solicit the shareholders’ right to vote in a
chargeable or disguised chargeable manner. Saving for statutory conditions, the Company shall
not impose restriction on minimum shareholding proportion against solicitation of voting
rights.
When a connected transaction is considered at a general meeting, the connected
shareholders shall not participate in casting votes and the number of shares with voting rights
represented by them shall not be counted in the total number of valid votes. The announcement
of the resolutions of the general meeting shall fully disclose the voting status of the
non-connected shareholders. Such connected transaction shall be voted by the non-connected
shareholders attending the meeting on a poll, with the consent of more than half of the valid
voting rights of the non-related shareholders who voted at the meeting; if such transaction falls
within the scope of a special resolution, it shall be approved by more than two-thirds of the
valid voting rights held by the shareholders (including proxies of shareholders) attending the
general meeting. If any shareholders should give up the voting right for certain proposal or are
restricted to be only able to vote for or against certain proposal in accordance with the
provisions of applicable laws and regulations and the Hong Kong Listing Rules, the votes by
those shareholders or their representatives shall not be counted in case of any violation of the
relevant provisions or restriction.
BOARD OF DIRECTORS
Directors
The Directors of the Company shall include executive Directors, non-executive Directors
and independent Directors. The Directors of the Company shall be natural persons. Person
falling under any of the following circumstances may not act as the Directors of the Company:
(i) a person who is unable or has limited ability to undertake any civil liabilities;
(ii) a person who has been convicted of an offense of bribery, corruption, embezzlement
or misappropriation of property, or the destruction of socialist market economy
order; or who has been deprived of his political rights due to his crimes, in each case
where less than five years have elapsed since the date of completion of the sentence;
(iii) a person who has been a former director, factory manager or manager of a company
or an enterprise that has entered into insolvent liquidation and who was personally
liable for the insolvency of such company or enterprise, where less than three years
have elapsed since the date of the completion of the bankruptcy and liquidation of
the company or enterprise;
(iv) a person who has been a legal representative of a company or an enterprise that has
had its business license revoked due to violations of the law and has been ordered
to close down by law and the person was personally responsible, where less than
three years have elapsed since the date of such revocation;
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-15 –


--- page 2053 ---
(v) a person who is liable for a relatively large amount of debts that are overdue;
(vi) a person who has been barred from the securities market by the CSRC for a certain
period of time and such period has not expired yet;
(vii) any other circumstances stipulated by applicable laws, administrative regulations,
regulations of the authorities, or requirements under the listing rules of the place
where the shares of the Company are listed.
Directors shall be elected or replaced by the general meeting, and may further be removed
from their office prior to the conclusion of the term thereof by the general meeting. The term
of office of a Director shall not be more than three years, which is renewable upon re-election.
The tenure of a Director shall be from the date of appointment to the expiry of tenure of
the current Board of Directors. If a Director’s tenure expires but a re-elected Director is not
elected in time, then before the re-elected Director holding office, the original Director shall
still perform the duties as Director, in accordance with applicable laws, administrative
regulations, regulations of the authorities and the Articles of Association.
Directors may be concurrently held by the President or other senior management
members, but the total number of Directors concurrently serving as the President or other
senior management members shall not exceed one half of the total number of Directors of the
Company.
It is unnecessary for Directors to hold shares of the Company.
A Director may propose resignation before expiry of tenure, by filing a resignation report
in writing to the Board of Directors. The Board of Directors will disclose the relevant
information in a timely manner in accordance with the provisions of the securities regulatory
rules of the place where the shares of the Company are listed. If the resignation of a Director
causes the number of Board of Directors members to be less than the quorum, and would result
in the proportion of independent Directors on the Board of Directors or its special committees
not in compliance with the provisions of laws and regulations or the Articles of Association,
or if there is a lack of accounting professionals among the independent Directors, then the
original Director shall still perform the duties as Director under the applicable laws,
administrative regulations, regulations of the authorities and the Articles of Association before
the re-elected Directors take office. Otherwise, a Director’s resignation shall be effective from
the time such resignation report is delivered to the Board of Directors.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-16 –


--- page 2054 ---
Board of Directors
The Company shall establish a Board of Directors, who shall be accountable to the
general meeting. The Board of Directors of the Company shall comprise nine members, and the
number of independent Directors shall not be less than one-third.
The Board of Directors shall exercise the following powers and duties:
(i) to convene the general meeting and to report on its work to the general meeting;
(ii) to implement the resolutions adopted by the general meeting;
(iii) to determine the Company’s business plans and investment plans;
(iv) to formulate the Company’s plans for annual financial budgets and final accounts;
(v) to formulate the Company’s profit distribution plans and plans to cover losses;
(vi) to formulate the plans for the increase or reduction of the Company’s registered
capital and the plans for the issuance of the Company’s bonds or other securities and
listing plans;
(vii) to draft the plans for major acquisitions, repurchases of the Company’s shares or
merger, division, dissolution or change of the corporate form of the Company;
(viii) to determine, within the scope authorized by the general meeting, such matters as the
Company’s external investments, the purchase and sale of assets, asset mortgages,
external guarantees, entrusted wealth management, related-party transactions and
external donations;
(ix) to decide on the establishment of the Company’s internal management
organizations;
(x) to appoint or remove the Company’s President, the secretary of the Board of
Directors, and, according to the nomination of the President, to appoint or remove
the senior management members of the Company, such as the Vice President and
chief financial officer and decide on matters relating to their remuneration and
rewards;
(xi) to formulate and amend the Company’s basic management policy;
(xii) to formulate the plans for the amendment of the Articles of Association;
(xiii) to manage the Company’s information disclosure;
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-17 –


--- page 2055 ---
(xiv) to propose to the general meeting the appointment or replacement of an accounting
firm that performs audits for the Company;
(xv) to listen to the work report of the President of the Company and inspect the work
of the President;
(xvi) Other powers and duties conferred by laws, administrative regulations, regulations
of the authorities, securities regulatory rules of the place where the shares of the
Company are listed, or the Articles of Association.
The Board of Directors shall have the right to dispose of, guarantee, make external
investment, finance, engage in connected transactions, and make external donations within a
certain limit, subject to compliance with the securities regulatory rules of the place where the
shares of Company are listed. The Board of Directors shall abide by the principles of legality,
compliance, prudence, and safety when exercising the above-mentioned rights, establish strict
review and decision-making procedures, and organize relevant experts and professionals to
review major investment projects, and submit them to the general meeting for approval. The
specific approval authority of the Board of Directors is as follows:
(i) the disposal of assets other than those that require approval by the general meeting
as stipulated in Article 43 of the Articles of Association refers to the purchase, sales,
and restructuring of creditor’s rights and debts;
(ii) external investments with a total amount not exceeding 30% of the Company’s latest
audited total assets within a complete accounting year, including equity investments,
bond investments, entrusted wealth management, entrusted loans, and other legally
compliant corporate investment activities;
(iii) financing that does not exceed 60% of the audited net assets of the previous year
within a complete accounting year, which refers to the Company’s bond financing
to financial institutions and other enterprises (but does not include issuing bonds);
(iv) external guarantees other than those listed in Article 44 of the Articles of
Association (including but not limited to asset mortgages, pledges, guarantees, etc.);
(v) connected transactions between the Company and its affiliated natural persons with
a transaction amount of over RMB300,000 (excluding external guarantees), and
related party transactions with affiliated legal persons with a transaction amount of
over RMB3 million and accounting for more than 0.5% of the absolute value of the
Company’s latest audited net assets (excluding external guarantees) within a
complete accounting year.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-18 –


--- page 2056 ---
When exercising the above-mentioned powers and duties, the Board of Directors shall
comply with relevant laws, regulations, rules, and the Rules Governing the Listing of Shares
on the Shanghai Stock Exchange and Hong Kong Listing Rules. Subject to compliance with the
listing rules of the place where the shares of Company are listed, the Board of Directors may
authorize the Chairman, the President or the related internal institutions to make decisions and
exercise the aforementioned powers and duties of the Board of Directors as stipulated in the
Articles of Association during its closing period. The specific decision-making authority shall
be clarified by the resolution of the Board of Directors or relevant rules and regulations of the
Company.
The Board of Directors shall have one Chairman and may have Co-Chairman and Deputy
Chairman according to the needs of the work. The Chairman, the Co-Chairman and the Deputy
Chairman shall be elected or removed by more than half of all the Directors for a term of three
years and shall be re-elected and re-appointment upon expiration.
The Chairman shall exercise the following powers and duties:
(i) presiding over general meeting, convening and presiding over meetings of the Board
of Directors;
(ii) supervising and inspecting the implementation of resolutions of the Board of
Directors;
(iii) signing the shares, corporate bonds and other securities of the Company;
(iv) signing important documents of the Board of Directors and other documents that
should be signed by the Company’s legal representative;
(v) exercising the powers and duties of the legal representative;
(vi) in the event of a force majeure emergency such as a catastrophic natural disaster,
exercise the special right to dispose of the Company’s affairs in accordance with
laws, regulations, securities regulatory provisions of the place where the shares of
the Company are listed and the interests of the Company, and report to the Board of
Directors of the Company and general meeting afterwards;
(vii) other powers and duties granted by the Board of Directors.
The Co-Chairman and Deputy Chairman of the Company assist the Chairman in his work.
Where the Chairman is unable or fails to perform its duties, such duties shall be performed by
the Co-Chairman (if the Company has two or more Co-Chairmen, such duties shall be
performed by the Co-Chairman jointly elected by a simple majority of Directors); if the
Co-Chairman is unable or fails to perform such duties, such duties shall be performed by
Deputy Chairman (if the Company has two or more Deputy Chairmen, such duties shall be
performed by the Deputy Chairman jointly elected by a simple majority of Directors); if the
Deputy Chairman is unable or fails to perform such duties, such duties shall be performed by
a Director jointly elected by a simple majority of Directors.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-19 –


--- page 2057 ---
The Board of Directors shall hold at least one meeting every quarter, convened by the
Chairman, and notify all Directors and Supervisors in writing 14 days before the meeting is
held. Shareholders representing more than one tenth of the voting rights, or more than one-third
of the Board of Directors or Supervisory Committee, may propose to convene an extraordinary
general meeting of the Board of Directors. The Chairman shall convene and preside over the
meeting of the Board of Directors within 10 days after receiving the proposal. The Chairman
may also convene and preside over extraordinary general meetings of the Board of Directors
when deemed necessary.
Notice of extraordinary general meeting of the Board of Directors may be delivered by
notice in writing (include by hand, via facsimile), telephone, e-mail or SMS notification. The
notification deadline is three days before the meeting is held. However, in case of emergency,
where an extraordinary general meeting of the Board of Directors is required to be convened
as soon as possible, the notice of such meeting may be issued by phone or other oral methods
at any time. An extraordinary general meeting of the Board of Directors may be convened at
any time on the premise of notifying all Directors, and an explanation of the emergency shall
be made at the meeting by the convener.
Meetings of the Board of Directors shall be held only if more than half of the Directors
are present. Any resolutions of the Board of Directors must be subject to adoption by a simple
majority of all Directors. Each Director shall have one vote for the resolutions of the Board of
Directors.
If Directors have associated relationship with enterprises involved in issues to be
determined in the extraordinary general meeting of the Board of Directors, such Directors shall
not exercise the voting power on the resolution or exercise the voting power on behalf of other
Directors. The meeting of the Board of Directors may be held with over one-half Directors
without associated relationship, and the resolutions of the meeting of the Board of Directors
shall be approved by over one-half Directors without associated relationship. If the
unassociated Directors attending the meeting of the Board of Directors are less than 3 people,
the issues shall be submitted to the general meetings for examination. If a substantial
shareholder or a Director has a conflict of interest in a matter to be considered by the Board
of Directors which the Board of Directors has determined to be material, the matter shall be
dealt with by convening a physical meeting of the Board of Directors rather than a written
resolution. Independent non-executive Director who, and whose close associates, have no
material interest in the transaction should be present at that the meeting of the Board of
Directors. If there are any additional restrictions on Directors’ participation in meeting of the
Board of Directors and voting imposed by laws, regulations and securities regulatory rules of
the place where the shares of the Company are listed, such provisions shall prevail.
Resolutions to be adopted at the meeting of the Board of Directors shall be voted by a
show of hands or in writing. Unless otherwise provided by the securities regulatory rules of the
place where the shares of the Company are listed and the Articles of Association, the
extraordinary general meetings of the Board of Directors may, under the premise that Directors
will be guaranteed to have their opinions fully and thoroughly expressed, be conducted via
facsimile or other communication and resolutions may be passed thereat, to be signed by the
Directors present at the meeting.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-20 –


--- page 2058 ---
The Directors shall attend in person the meetings of the Board of Directors. Where any
Director who cannot attend for reasons may entrust another Director in writing to attend and
vote on his/her behalf. The power of attorney shall specify the name of the agent, the matters
to be represented, the scope of authorization, and the period of validity, and shall be signed or
stamped by the principal. The Directors who attend the meeting on behalf shall exercise the
rights as Directors within the scope of authorization. Failure by a Director to attend a meeting
of the Board of Directors or to authorize a representative to attend the meeting on his/her behalf
shall be deemed waiver of the voting right at such meeting.
PRESIDENT AND OTHER SENIOR MANAGEMENT MEMBERS
The Company shall have one President, who shall be appointed or dismissed by the Board
of Directors. The Company shall have several Vice Presidents, who shall be appointed or
dismissed by the Board of Directors.
Article 99 of the Articles of Association on the duty of loyalty of Directors and Article
100 (iv) to (vi) on the duty of diligence are also applicable to senior management members.
The term of office of the President is three years and the President can renew his term of
office through re-election.
The President of the Company shall be accountable to the Board of Directors and shall
exercise the following powers:
(i) to preside over the operation and management of the Company and report to the
Board of Directors;
(ii) to organize the implementation of the Company’s annual operation plans and
investment plans;
(iii) to draft the plan for the establishment of the Company’s internal management
organizations;
(iv) to draft the basic management policy of the Company;
(v) formulate the salary, welfare, rewards and punishments of the Company’s
employees, and decide on the employment and dismissal of the Company’s
employees;
(vi) to formulate specific rules and regulations of the Company;
(vii) to propose to the Board of Directors on the appointment or dismissal of the
Company’s other senior management members including Vice President and chief
financial officer;
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-21 –


--- page 2059 ---
(viii) to determine to appoint or dismiss the management personnel except for those who
should be appointed or dismissed by the Board of Directors;
(ix) such other powers granted by the Articles of Association or the Board of Directors.
The President of the Company shall attend meetings of the Board of Directors.
The senior management members of the Company shall faithfully perform their duties and
safeguard the best interests of the Company and all shareholders. If the senior management
members of the Company fail to faithfully perform their duties or violates the duty of good
faith, causing damage to the interests of the Company and the shareholders of the public shares,
they shall be liable for compensation in accordance with laws.
SUPERVISORY COMMITTEE
Supervisors
The Directors, the President and other senior management members shall not act
concurrently as Supervisors.
Supervisors shall abide by laws, administrative regulations and the Articles of
Association, have a duty of loyalty and diligence to the Company, and shall be prohibited from
abusing their authority in accepting bribes or other unlawful income and from misappropriating
the Company’s properties.
The term of office of Supervisors shall be three years renewable upon re-election and
re-appointment.
Where a Supervisor fails to be re-elected in a timely manner upon the expiration of his
or her term of office, or where a Supervisor resigns during his or her term of office, resulting
in a lower than the quorum of the Supervisory Committee, the original Supervisor shall still
perform his or her duties as a Supervisor in accordance with the provisions of laws,
administrative regulations, and the Articles of Association before a re-elected Supervisor takes
office.
Supervisory Committee
The Company shall have a Supervisory Committee. The Supervisory Committee shall be
composed of 3 Supervisors. The Supervisory Committee shall have one Chairman and shall
have a Deputy Chairman according to the needs of the work. The Chairman and the Deputy
Chairman of Supervisory Committee shall be elected by a simple majority of all Supervisors.
The Chairman of the Supervisory Committee convenes and presides over a meeting of the
Supervisory Committee, and if the Chairman of the Supervisory Committee is unable to
perform his or her duties or fails to perform his or her duties, the Deputy Chairman of the
Supervisory Committee shall convene and preside over the meeting of the Supervisory
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-22 –


--- page 2060 ---
Committee, and if the Deputy Chairman of the Supervisory Committee is unable to perform his
duties or fails to perform his or her duties, a simple majority of Supervisors shall jointly
nominate one of the Supervisors to convene and preside over the meeting of the Supervisory
Committee.
The Supervisory Committee shall be composed of Supervisors who are either Shareholder
representatives or an appropriate proportion of employee representatives. The employee
representative Supervisors shall account for at least one-third of entire Supervisors. The
employee representative Supervisors shall be democratically elected and removed at the
Company’s employee representative meeting, the employees’ meeting or by other means.
Shareholder representatives shall be elected and removed at the general meeting.
The Supervisory Committee shall be accountable to the general meeting, and shall
exercise the following powers in accordance with laws:
(i) shall audit the Company’s securities issuance documents and periodic reports
prepared by the Board of Directors and issue auditing opinions in writing;
(ii) to check the Company’s financial position;
(iii) supervise the performance of duties by Directors and senior management members,
and propose the removal of Directors and management members who violate laws,
administrative regulations, Articles of Association or resolutions of the general
meetings;
(iv) when the behavior of Directors and senior management member harms the interests
of the Company, the Directors and management members are required to make
corrections;
(v) propose to convene an extraordinary general meeting to convene and preside over a
general meeting when the Board of Directors fails to perform its duties of convening
and presiding over a general meeting as stipulated in the Company Law;
(vi) submit proposals to the general meeting;
(vii) represent the Company in negotiations with or bringing an action against Directors
and management members in accordance with Article 151 of the Company Law;
(viii) if the Company’s operation is found to be abnormal, it can be investigated; When
necessary, accounting firms, law firms and other professional institutions can be
engaged to assist in their work, and the cost shall be borne by the Company;
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-23 –


--- page 2061 ---
(ix) to check the financial information, such as the financial reports, reports of
operations and profit distribution plans to be submitted by the Board of Directors to
the general meeting, and to authorize, in the Company’s name, public certified
accountants and licensed auditors to assist in the re-examination of such
information, should any doubt arise in respect thereof;
(x) such other powers as provided by laws, administrative regulations and regulations
of the authorities or provisions of the Articles of Association or other powers
conferred by the general meeting.
The Supervisory Committee shall hold at least one meeting every six months, and shall
be convened by the Chairman of the Supervisory Committee. Supervisors may propose to
convene an extraordinary meeting of Supervisors. A resolution of the Supervisory Committee
shall be passed by more than half of all the Supervisors.
FINANCIAL AND ACCOUNTING POLICY AND PROFIT DISTRIBUTION
AND AUDIT
Financial And Accounting Policy
The Company shall establish its financial and accounting policies in accordance with
laws, administrative regulations and provisions of competent authorities.
The Company shall submit and disclose its annual report to the CSRC and the stock
exchange of the place where the shares of the Company are listed within four months from the
end of each accounting year, and its announcement of interim results to the agencies of the
CSRC and the stock exchange of the place where the shares of the Company are listed within
two months from the end of first half of each accounting year. The above annual report and
interim report shall be prepared in accordance with relevant laws, administrative regulations,
regulations of the authorities and the regulations of the stock exchange of the place where the
shares of the Company are listed.
Saving for the statutory accounting books, the Company does not set up separate
accounting books. The Company’s assets should not be deposited in any account opened under
any personal name.
Profits Distribution
In distributing the profits after tax for the current year, the Company shall allocate 10%
of the profits to its statutory reserve. When the accumulated statutory reserve exceeds 50
percent of the Company’s registered capital, the Company may cease to make such allocation.
If the statutory reserve is not sufficient to cover the losses made in the previous year, the
Company may make allocation to the discretionary reserve from the profits after tax. The
remaining profits after tax after offsetting its losses and allocating to its reserves may be
distributed to its shareholders in proportion to their shareholding percentages unless otherwise
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-24 –


--- page 2062 ---
provided in the Articles of Association. If at a general meeting, the requirements stipulated in
the preceding paragraph are breached by distributing profits to the shareholders before
offsetting losses of the Company and allocating to its statutory surplus reserve, the profits so
distributed are required to be returned to the Company. The shares held by the Company are
not entitled to any profit distribution.
The Company shall appoint one or more collection agents in Hong Kong SAR for H share
shareholders. The collection agents shall collect or keep the dividends distributed by the
company on H shares and other amounts payable on behalf of the relevant H share shareholders
pending payment to such H share shareholders. The collection agents appointed by the
Company shall meet the requirements of the laws, regulations and the securities regulatory
rules of the place where the Company’s shares are listed.
The common reserve funds of the Company shall be used to make up for the losses,
expansion of the Company’s production or operation or increase the capital of the Company.
However, the capital reserve fund shall not be used to make up for losses of the Company.
After a resolution on the profit distribution plan is made at the general meeting, the Board
of Directors of the Company shall complete the distribution of the dividend (or shares) within
two months after the said meeting. If the specific plan cannot be implemented within two
months according to the provisions of laws and regulations and the securities regulatory rules
of the place where the shares of the Company are listed, the implementation date of the specific
plan can be adjusted according to such provisions and the actual situation.
The Company shall distribute dividends in form of cash, shares or a combination of cash
and shares, and shall prioritize profit distribution in form of cash.
INTERNAL AUDIT
The Company shall implement an internal auditing policy and appoint full time auditors
to carry out internal auditing and supervision of the Company’s incomes and expenses and
economic activities.
The internal audit policy of the Company and the responsibilities of auditors shall be
implemented upon approval by the Board of Directors. The personnel in charge of auditing is
responsible to the Board of Directors and reports on relevant work.
ENGAGEMENT OF ACCOUNTING FIRMS
The Company engages an accounting firm that complies with the Securities Law, Hong
Kong Listing Rules, and securities regulatory rules of the place where the shares of the
Company are listed to conduct accounting statement auditing, net asset verification, and other
related consulting services. The engagement period is one year and can be renewed.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-25 –


--- page 2063 ---
The engagement of an accounting firm is decided by the General Meeting. The Board of
Directors shall not engage an accounting firm prior to the decision by the General Meetings.
The Company guarantees to provide the hired accounting firm with true and complete
accounting vouchers, accounting books, financial accounting reports, and other accounting
data. Refusal, concealment, and false reporting are not allowed.
The audit fees of the accounting firm shall be determined by the General Meeting.
The Company shall send a 30-day prior notice to the accounting firm, in order to dismiss
or not to reappoint the accounting firm, and the said accounting firm is entitled to give opinions
when the General Meeting of the Company votes on the dismissal of the accounting firm.
The accounting firm, in order to resign, shall make representations whether the Company
has any improper affairs to the General Meeting.
MERGER, DIVISION, CAPITAL INCREASE, CAPITAL REDUCTION, DISSOLUTION
AND LIQUIDATION
Merger, Division, Capital Increase And Capital Reduction
The merger of the Company may take the form of either merger by absorption or merger
by consolidation.
A company that absorbs other company is known as merger by absorption whereby the
company being absorbed shall be dissolved. The merger of two or more companies by the
establishment of a new company is known as merger by the establishment of a new company
whereby the merged companies shall be dissolved.
In the event of merger of the Company, the parties to such merger shall execute a merger
agreement and prepare a balance sheet and an inventory of assets. The Company shall notify
its creditors within ten days of, and make announcement in the newspapers within thirty days
of, the date of the Company’s resolution for merger. A creditor may, within 30 days of receipt
of the notice from the Company or, in the case of failure to receive such notice, within 45 days
of the date of announcement, require the Company to repay its debts or to provide a
corresponding guarantee for such debt.
After merger, any creditor’s rights and indebtedness of the merged parties shall be
assumed by the Company which survives the merger or the newly established company.
In the event of division of the Company, its assets shall be divided up accordingly.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-26 –


--- page 2064 ---
In the event of division of the Company, the parties to division shall execute a division
agreement and prepare a balance sheet and an inventory of assets. The Company shall notify
its creditors within ten days of, and make announcement in the newspapers within 30 days, of
the date of the Company’s division resolution.
Debts owed by the Company prior to the division shall be assumed by the companies upon
the division according to the agreement entered into unless provided otherwise in a written
agreement on debt repayment reached between the Company and a creditor prior to the
division.
The Company must prepare a balance sheet and an inventory list of its assets when it
intends to reduce its registered capital.
The Company shall notify its creditors within 10 days of, and make announcement in the
newspapers within 30 days, of the date of the Company’s resolution for reduction of capital.
A creditor may, within thirty days of receipt of the notice from the Company or, in the case of
failure to receive such notice, within 45 days of the date of announcement, require the
Company to repay its debts or to provide a corresponding guarantee for such debt.
The Company’s registered capital must not, after the reduction in capital, be less than the
minimum amount required by laws.
The Company shall, in accordance with laws, handle the procedures for change
registration with the Company registration authority where a change in any registration items
arises as a result of any merger or division. In the event of dissolution of the Company, the
Company shall handle the procedures for registration of cancellation in accordance with the
law. In the event of establishment of a new company, the Company shall handle the procedures
for registration of establishment in accordance with laws.
Where the Company increases or reduces its registered capital, the Company shall handle
the procedures for change registration with the Company registration authority in accordance
with laws.
DISSOLUTION AND LIQUIDATION
The Company may be dissolved and go into liquidation in accordance with laws in any
of the following circumstances:
(i) where the operation period provided herein expires or where any cause for
dissolution provided herein occurs;
(ii) where the general meeting has adopted a resolution for dissolution;
(iii) where dissolution is required due to merger or division of the Company;
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-27 –


--- page 2065 ---
(iv) where the Company is declared bankrupt in accordance with laws due to its inability
to pay the debts that are due;
(v) where the business license of the Company is revoked, or the Company is ordered
to close down or cancelled in accordance with laws;
(vi) where the Company runs deep into difficulties in operation and management, its
continuous existence may cause material losses to shareholders’ interests, and such
difficulties cannot be dealt with in other ways, the shareholders holding 10% or
more of votes of all shareholders of the Company may file an application to the
People’s Court to dissolve the Company.
In the circumstance as set out in the Item (i) of the preceding article, the Company may
continue to exist by amending the Articles of Association; if this Articles of Association is
amended subject to the aforesaid provisions, it must be approved by shareholders representing
two-thirds or above of the voting rights present at the general meeting.
Where the Company is dissolved pursuant to the items (i), (ii), (v) and (vi) of the
preceding article, a liquidation team shall be established within 15 days and start to carry out
liquidation. The liquidation team shall be composed of persons determined by Directors or the
general meeting. In case no liquidation team is established within the specified period to carry
out liquidation, the creditors may file an application to the People’s Court to designate relevant
persons to form a liquidation team to carry out liquidation.
The liquidation team shall notify the creditors within 10 days of, and make
announcements in the newspapers within 60 days, of the date of its establishment. A creditor
shall, within 30 days of receipt of the notice, or in the case of failure to receive the notice,
within 45 days of the date of the announcement, claim its rights to the liquidation team.
In claiming its rights, the creditor shall explain the relevant issues on the creditor’s rights,
and provide evidential materials in respect thereof. The liquidation team shall register the
creditor’s rights in accordance with the relevant laws.
In the course of claiming of creditors’ rights, the liquidation team shall not make any
repayment to creditors.
After it has liquidated the Company’s assets and prepared the balance sheet and an
inventory of assets, the liquidation team shall formulate a liquidation plan and present it to the
general meeting or to the People’s Court for confirmation. The assets of the Company shall be
applied in the sequence below: payment of liquidation costs, salary of employees, social
insurance premiums, statutory compensation, taxes payable, and debts of the Company. The
remaining assets after payment is made pursuant to the foregoing provision shall be distributed
to its shareholders according to the category and proportion of the shares held by shareholders.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-28 –


--- page 2066 ---
During the liquidation period, the Company remains in existence; however, it shall not carry
out any business activities unrelated to liquidation. The Company’s assets shall not be
distributed to its shareholders before payment is made pursuant to the foregoing provision.
In the event of liquidation due to dissolution of the Company, after liquidation of the
Company’s assets and preparation of a balance sheet and an inventory of assets, the liquidation
team discovers that the Company’s assets are insufficient to pay the Company’s debts in full,
the liquidation team shall file an application to the People’s Court for declaration of bankruptcy
in accordance with laws. After the Company is declared bankrupt pursuant to the adjudication
of the People’s Court, the liquidation team shall transfer all matters relating to the liquidation
to the People’s Court.
Upon completion of the liquidation, the liquidation team shall prepare a liquidation report
and submit it to the general meeting or the People’s Court for confirmation, and shall submit
the same to the registration authority of the Company and apply for cancellation of registration
of the Company, and make announcement relating to the termination of the Company.
Where the Company is declared bankrupt in accordance with laws, bankruptcy liquidation
shall be carried out in accordance with the laws concerning bankruptcy of enterprises.
AMENDMENTS TO THE ARTICLES OF ASSOCIATION
In any of the following circumstances, the Company shall amend the Articles of
Association:
(i) the Articles of Association are contradictory to any provision of the amended
version of the Company Law or other relevant laws or administrative regulations or
the securities regulatory rules of the place where the shares of the Company are
listed;
(ii) there is any change to the condition of the Company, which is inconsistent with any
matter recorded in the Articles of Association;
(iii) the general meeting adopts a resolution for amendment of the Articles of
Association.
If an amendment of the Articles of Association adopted by the resolution of the general
meeting needs to be approved by the competent authority, it shall be submitted to the
competent authority for approval; if there is any change relating to the registered particulars
of the Company, the procedures for change registration shall be handled in accordance with
laws.
The Board of Directors shall amend the Articles of Association according to the resolution
of the general meeting for amendments hereof and the approval opinions of competent
authority.
APPENDIX VI SUMMARY OF ARTICLES OF ASSOCIATION
– VI-29 –


--- page 2067 ---
A. FURTHER INFORMATION ABOUT OUR GROUP
1. Incorporation of our Company
Our Company was established in the PRC as a limited liability company on June 22, 1998.
On August 23, 2000, it was converted into a joint stock company with limited liability under
the PRC Company Law. Since April 14, 2004, our A Shares have been listed on the Shanghai
Stock Exchange with the stock code of 600988. Our registered office is located at Fumin
Village, Sidaowanzi Town, Aohan, Chifeng, Inner Mongolia Autonomous Region, PRC.
We have established a principal place of business in Hong Kong at Room 1905, 19th
Floor, China Resources Building, 26 Harbour Road, Wanchai, Hong Kong, and was registered
as a non-Hong Kong company under Part 16 of the Companies Ordinance on October 14, 2024
under the same address. Mr. Wong Hok Bun Mario has been appointed as our agent for the
acceptance of service of process and notices on our behalf in Hong Kong. The address for
service of process on the Company in Hong Kong is the same as its principal place of business
in Hong Kong as set out above.
As we were established in the PRC, our corporate structure and Articles of Association
are subject to the relevant laws and regulations of the PRC. A summary of the relevant
provisions of our Articles of Association is set out in Appendix VI to this Prospectus. A
summary of certain relevant aspects of the laws and regulations of the PRC is set out in
Appendix V to this Prospectus.
2. Changes in the share capital of our Company
For details relating to the changes in the share capital of our Company, see the section
headed “History, Development and Corporate Structure — Major Changes in Shareholding and
Share Capital of our Company” in this Prospectus.
Save as disclosed above, there has been no alteration in our share capital within the two
years immediately preceding the date of this Prospectus.
3. Changes in the share capital of our subsidiaries
For details relating to the changes in the share capital of our subsidiaries, please refer to
the section headed “History, Development and Corporate Structure — Our Principal
Subsidiaries” in this Prospectus.
Save as disclosed in this Prospectus, there has been no alteration in the share capital of
any of our subsidiaries within the two years immediately preceding the date of this Prospectus.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-1 –


--- page 2068 ---
4. Resolutions in writing of our Shareholders passed on August 23, 2024
Pursuant to the written resolutions passed by our Shareholders on August 23, 2024, it was
resolved, among others:
(a) the issue by our Company of H Shares of nominal value of RMB1.00 each and such
H Shares be listed on the Hong Kong Stock Exchange;
(b) the number of H Shares to be issued before the exercise of the Over-allotment
Option for the Global Offering shall not exceed 15% of the enlarged share capital
of our Company upon completion of the Global Offering and granting the
Underwriters of not more than 15% of the above number of H Shares issued pursuant
to the Global Offering;
(c) authorization of the Board and its authorized persons to handle all matters relating
to, among other things, the Global Offering, the issue and listing of the H Shares;
and
(d) subject to the completion of the Global Offering, the conditional adoption of the
revised Articles of Association, which shall become effective on the Listing Date.
5. Restrictions on Share Repurchase
For details of the restrictions on share repurchase by our Company, please refer to
“Appendix VI — Summary of the Articles of Association” to this Prospectus.
B. FURTHER INFORMATION ABOUT OUR BUSINESS
1. Summary of our Material Contracts
We have entered into the following contracts (not being contracts entered into in the
ordinary course of business) within the two years immediately preceding the date of this
Prospectus that are or may be material:
(a) an equity transfer agreement entered into among China Investment (Property)
Limited ( ʕ਷ҳ༟(ໄุ)ʮ̡)( “ China Investment ”), China Investment
Mining (Laos) Sole Co., Ltd, Chixia Laos and Chijin Xiawu on March 4, 2024,
pursuant to which Chixia Laos agreed to acquire from China Investment 90% of the
equity interest in China Investment Mining (Laos) Sole Co., Ltd at a total
consideration of US$18,963,000;
(b) a cornerstone investment agreement dated February 26, 2025 and entered into
among our Company, Gold Mountains (H.K.) International Mining Company
Limited (ʆ(ಥ)ʮ̡), CITIC Securities (Hong Kong) Limited ( ʕ
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-2 –


--- page 2069 ---
ᗇՎ(ಥ)ʮ̡), CLSA Limited (ʮ̡) and Macquarie
Capital Limited (ʮ̡) with respect to a subscription of the H
Shares at the Offer Price in the amount of the Hong Kong dollar equivalent of
US$40 million;
(c) a cornerstone investment agreement dated February 26, 2025 and entered into
among our Company, Sparky International Company Limited (ʮ
̡), CITIC Securities (Hong Kong) Limited (ᗇՎ(ಥ)ʮ̡), CLSA
Limited (ʮ̡), Macquarie Capital Limited (ࠢ
ʮ̡) and China International Capital Corporation Hong Kong Securities Limited
(ʮ̡) with respect to a subscription of the H Shares at
the Offer Price in the amount of the Hong Kong dollar equivalent of RMB400
million; and
(d) the Hong Kong Underwriting Agreement.
2. Material intellectual property rights of our Group
Save as disclosed below, as of the Latest Practicable Date, there were no other intellectual
property rights which are or may be material to our business in the opinion of our Directors.
(a) Trademarks
(i) Registered Trademarks
As of the Latest Practicable Date, we have registered the following trademarks which we
consider to be or may be material to our business:
No.
Name of
Registered
Proprietor Trademark
Registration
Number Class
Place of
Registration Expiry Date
1 /H1118/H1118Our Company
 12370177 37 PRC April 6, 2025 (1)
2 /H1118/H1118Our Company
 12370166 37 PRC April 6, 2025 (1)
3 /H1118/H1118Our Company
 43088353 37 PRC December 20,
2030
4 /H1118/H1118Our Company
 43097556 42 PRC December 13,
2030
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-3 –


--- page 2070 ---
No.
Name of
Registered
Proprietor Trademark
Registration
Number Class
Place of
Registration Expiry Date
5 /H1118/H1118Our Company
 43204068 37 PRC January 27,
2031
6 /H1118/H1118Our Company
 43238591 42 PRC January 27,
2031
7 /H1118/H1118Hanfeng Mining
 7827527 36 PRC March 13, 2031
8 /H1118/H1118Hanfeng Mining
 6709701 6 PRC March 27, 2030
9 /H1118/H1118Guangyuan
Technology
41834913 40 PRC September 20,
2030
10 /H1118LXML 57702 6, 17, 40,
41, 42
Lao PDR January 17,
2033
11 /H1118LXML 57703 6, 17, 40,
41, 42
Lao PDR January 17,
2033
12 /H1118Our Company (A) 306629266 1, 6, 14,
37, 42
Hong Kong August 1, 2034
(B)
13 /H1118Our Company (A) 306629257 1, 6, 14,
37, 42
Hong Kong August 1, 2034
(B)
(C)
(D)
Note:
(i) These trademarks remained to be validly registered in PRC as of the Latest Practicable Date. To the best
knowledge of the Directors having made all reasonable enquiries, there are no legal impediment to the
renewal of the registration of these trademarks upon the expiry date, if necessary.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-4 –


--- page 2071 ---
(ii) Trademarks Pending Registration
As of the Latest Practicable Date, we have applied for the registration of the following
trademarks which we consider to be or may be material to our business:
No. Name of Applicant Trademark
Application
Number Class
Place of
Application
Application
Date
1 /H1118/H1118Our Company (A) 306630994 1, 6, 14,
37, 42
Hong Kong August 5, 2024
(B)
2 /H1118/H1118Our Company (A)
 306631001 1, 6, 14,
37, 42
Hong Kong August 5, 2024
(B)
(b) Patents
(i) Registered Patents
As of the Latest Practicable Date, we had registered the following patents which we
consider to be or may be material to our business:
No.
Name of
Patentee Name of Patent
Registration
Number
Place of
Registration
Registration
Date
Validity
Period Category
1 /H1118/H1118Wulong
Mining
Miner’s lamp ( ᘤዱ) ZL201410515583.1 PRC September 29,
2014
20 years Original
Invention
2 /H1118/H1118Wulong
Mining
A kind of three-quarter
mine shaft hoisting
mechanism ( ɓ၇ɧ
ʱᘤሤʜ౤ʺዚ࿴)
ZL202121602737.2 PRC July 15, 2021 10 years Utility model
3 /H1118/H1118Wulong
Mining
A quarter mine
ventilation system
(ӻ
୕)
ZL202121653692.1 PRC July 20, 2021 10 years Utility model
4 /H1118/H1118Wulong
Mining
A kind of reversed
continuous charging
structure using upper
disk columns ( ɓ၇
ˀΣஹ
ᚃༀᖹഐ࿴)
ZL202121665369.6 PRC July 21, 2021 10 years Utility model
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-5 –


--- page 2072 ---
No.
Name of
Patentee Name of Patent
Registration
Number
Place of
Registration
Registration
Date
Validity
Period Category
5 /H1118/H1118Wulong
Mining
A kind of safety
protection cage for
mine ( ɓ၇ᘤʜ͜τ
Όԣᚐᜦᛐ)
ZL202121666391.2 PRC July 21, 2021 10 years Utility model
6 /H1118/H1118Wulong
Mining
A kind of powder ore
recycling mat ( ɓ၇
ؐ)
ZL202121678701.2 PRC July 22, 2021 10 years Utility model
7 /H1118/H1118Wulong
Mining
A kind of motorcycle
frame line powder
failure protection
device ( ɓ၇ཥዚԓ
ᚐༀໄ)
ZL202121690127.2 PRC July 23, 2021 10 years Utility model
8 /H1118/H1118Wulong
Mining
An ore chute structure
arrangement
structure ( ɓ၇ᘤͩ
๠ʜഐ࿴̺ໄഐ࿴)
ZL202121690131.9 PRC July 23, 2021 10 years Utility model
9 /H1118/H1118Wulong
Mining
A kind of anti-
electrocution device
for overhead electric
locomotive based on
PLC architecture ( ɓ
׵PLCݖٙ
ᇞཥዚԓԣᙃཥༀ
ໄ)
ZL202320010120.4 PRC January 4,
2023
10 years Utility model
10. /H1118Wulong
Mining
A kind of mine shaft
dewatering device
(ɓ၇ᘤʆଉʜર˥
ༀໄ)
ZL202420431397.9 PRC March 6, 2024 10 years Utility model
11. /H1118Wulong
Mining
A kind of screen plate
structure that
improves the
screening efficiency
of the vibrating
screen ( ɓ၇̙౤৷
ጜ
ഐ࿴)
ZL202420287697.4 PRC February 7,
2024
10 years Utility model
12. /H1118Wulong
Mining
A kind of detachable
filter press feeding
structure (װ
ഐ
࿴)
ZL202420196505.9 PRC January 26,
2024
10 years Utility model
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-6 –


--- page 2073 ---
No.
Name of
Patentee Name of Patent
Registration
Number
Place of
Registration
Registration
Date
Validity
Period Category
13. /H1118Wulong
Mining
A kind of highly
efficient crushing
structure for
processing gold ore
(৷
ॎຟዚ࿴)
ZL202420080329.2 PRC January 12,
2024
10 years Utility model
14. /H1118Wulong
Mining
A kind of dust
suppression system
for a mine shaft ( ɓ
ྡྷᄝᗯ
ༀໄ)
ZL202420313948.1 PRC February 20,
2024
10 years Utility model
15. /H1118Wulong
Mining
A kind of automatic
recycling feeding
device for a filter
press ( ɓ၇ᏀᓩዚІ
ண௪)
ZL202420667903.4 PRC April 2, 2024 10 years Utility model
16 /H1118Wulong
Mining
A screening device for
a raw material for
mineral processing
agents ( ɓ၇፯ᘤᖹ
ጜʱༀໄ)
ZL202420545915.X PRC March 20,
2024
10 years Utility model
17 /H1118Jilong
Mining
A kind of zinc powder
feeding device
adopted for cyanide
leaching in gold
mine (ᘤʆ
ቔ४
ༀໄ)
ZL202121744747.X PRC July 29, 2021 10 years Utility model
18 /H1118Jilong
Mining
A positioning device
for uncoupled
charging of gun
holes (ˆʔᇩ
Зༀໄ)
ZL202121744748.4 PRC July 29, 2021 10 years Utility model
19 /H1118Jilong
Mining
A kind of belt
conveyor roller
frame ( ɓ၇ͤ੭༶፩
ݖ)
ZL202121742523.5 PRC July 29, 2021 10 years Utility model
20 /H1118Jilong
Mining
An improved mining
thickening device
(ᘤ͜ዢ
੗ዚༀໄ)
ZL202121744750.1 PRC July 29, 2021 10 years Utility model
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-7 –


--- page 2074 ---
No.
Name of
Patentee Name of Patent
Registration
Number
Place of
Registration
Registration
Date
Validity
Period Category
21 /H1118Jilong
Mining
A kind of mine
drainage ditch
dredging device ( ɓ
၇ᘤʜર˥๖૶૳ༀ
ໄ)
ZL202321032624.2 PRC April 28,
2023
10 years Utility model
22 /H1118Jilong
Mining
A kind of underground
automatic drainage
system ( ɓ၇ʜɨІ
ਗર˥ӻ୕)
ZL202321012760.5 PRC April 28,
2023
10 years Utility model
23 /H1118Jilong
Mining
A kind of belt
conveyor for
washing concentrate
(ͤ
੭፩৔ዚ)
ZL202320682501.7 PRC March 31,
2023
10 years Utility model
24 /H1118Jilong
Mining
A mine shaft
preheating system
(ɓ၇ᘤʜʜɹཫᆠ
ӻ୕)
ZL202320586472.4 PRC March 23,
2023
10 years Utility model
25 /H1118Jilong
Mining
An elevator gate tile
wear monitoring
system ( ɓ၇౤ʺዚ
ཛྷ͙ጋฦ္಻ӻ୕)
ZL202310026191.8 PRC January 9,
2023
20 years Original
Invention
26 /H1118Jilong
Mining
A multi-level
intelligent water
storage and drainage
system for mines ( ɓ
၇ᏀᓩዚІਗృᐑආ
ண௪)
ZL202420795574.1 PRC April 17,
2024
10 years Utility model
27 /H1118Jilong
Mining
An improved descaling
device for the
thickener ( ɓ၇ҷආ
ༀໄ)
ZL202420984997.8 PRC May 8, 2024 10 years Utility model
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-8 –


--- page 2075 ---
(c) Domain Names
As of the Latest Practicable Date, we have registered the following domain names which
we consider to be or may be material to our business:
No. Name of Registered Owner Domain Name
Place of
Registration Expiry Date
1 /H1118/H1118Our Company 600988.com.cn PRC March 4, 2030
2 /H1118/H1118Our Company cfgold.cn PRC June 4, 2030
3 /H1118/H1118Our Company chifeng-gold.com PRC June 6, 2032
4 /H1118/H1118Our Company cfgold.com PRC May 29, 2025
5 /H1118/H1118Our Company chifeng-gold.cn PRC June 6, 2025
6 /H1118/H1118Guangyuan Technology gykjgroup.cn PRC March 31,
2030
7 /H1118/H1118Wulong Mining wulongkuangye.com PRC July 7, 2025
(d) Literature Copyrights
No.
Name of
Registered Owner Software Name
Registration
Number
Place of
Registration
Registration
Date
Validity
Period
1 /H1118/H1118Our Company Gold Mining
LOGO (ږ
ᘤุLOGO)
Guozuo Dengzi
-2020-F-00992500
(਷Ъ೮ο-2020-
F-00992500)
PRC July 12, 2019 50 years
(e) Software Copyrights
No.
Name of
Registered
Owner Software Name
Registration
Number
Place of
Registration
Registration
Date
Validity
Period
1 /H1118/H1118Wulong Mining Wulong Gold
Mining Operator
Positioning
System (ږ
З
ӻ୕)
2020SR1056189 PRC October 20,
2019
50 years
2 /H1118/H1118Wulong Mining Wulong Gold
Mining Detection
System (ږ
ήᏀᏨ಻ӻ୕)
2020SR1055710 PRC March 11,
2019
50 years
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-9 –


--- page 2076 ---
No.
Name of
Registered
Owner Software Name
Registration
Number
Place of
Registration
Registration
Date
Validity
Period
3 /H1118/H1118Wulong Mining Intelligent Mine
Gas Safety
Monitoring and
Early Warning
Management
System ( ᘤʆं᜗
τΌ౽ঐʷ္಻ཫ
ᙆ၍ଣӻ୕)
2020SR1056218 PRC August 25,
2019
50 years
4 /H1118/H1118Wulong Mining Wulong Gold
Mining Video
Surveillance
Systems ( ʞᎲර
ᘤʆൖ᎖္છӻ
୕)
2020SR1056226 PRC June 30, 2019 50 years
5 /H1118/H1118Wulong Mining Wulong Gold
Mining Fiber
Optic Ring
System (ږ
Έᜄᐑၣӻ୕)
2020SR1055738 PRC May 17, 2019 50 years
6 /H1118/H1118Wulong Mining Wulong Gold Signal
Monitoring
System (ږ
໮္છӻ୕)
2020SR1055695 PRC March 31,
2019
50 years
7 /H1118/H1118Wulong Mining Control System for
Locomotive
Overhead Line
Anti-electrocution
Device (ᇞ
ԣᙃཥༀໄછՓӻ
୕)
2020SR1501182 PRC November 30,
2019
50 years
8 /H1118/H1118Jilong Mining Online
multifunctional
monitoring and
control system for
fans in gold
mines (ᘤʜɨ
ዚίᇞε̌ঐ္
಻છՓӻ୕)
2025SR0154335 PRC May 30, 2024 50 years
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-10 –


--- page 2077 ---
C. FURTHER INFORMATION ABOUT OUR DIRECTORS, SUPERVISORS AND
SUBSTANTIAL SHAREHOLDERS
1. Disclosure of Interests
(a) Interests and short positions of our Directors, Supervisors and the chief executive of
our Company in the shares, underlying shares and debentures of our Company and our
associated corporations
Save as disclosed below, immediately following the completion of the Global Offering
(assuming that the Offer Size Adjustment Option and the Over-allotment Option are not
exercised), so far as our Directors are aware, none of our Directors, Supervisors or chief
executive has any interests or short positions in our Shares, underlying shares and debentures
of our Company or any associated corporations (within the meaning of Part XV of the SFO)
which will have to be notified to our Company and the Hong Kong Stock Exchange pursuant
to Divisions 7 and 8 of Part XV of the SFO (including interests or short positions which they
are taken or deemed to have under such provisions of the SFO) or which will be required,
pursuant to Section 352 of the SFO, to be recorded in the register referred to therein or which
will be required to be notified to our Company and the Hong Kong Stock Exchange pursuant
to the Model Code for Securities Transactions by Directors of Listed Issuers contained in Hong
Kong Listing Rules.
Name Position
Nature
of interest
Description
of Shares
Number
of Shares
Approximate
percentage of
interest in the
total issued share
capital of our
Company as of
the Latest
Practicable Date
Approximate
percentage of
interest in the
A Shares
immediately
following the
completion of the
Global Offering
(assuming the
Offer Size
Adjustment
Option and the
Over-allotment
Option are not
exercised)
Approximate
percentage of
interest in the
total issued share
capital of our
Company
immediately
following the
completion of the
Global Offering
(assuming the
Offer Size
Adjustment
Option and the
Over-allotment
Option are not
exercised)
Wang Jianhua /H1118/H1118Chairman of the
Board and
Executive
Director
Beneficial
owner
A Shares 74,200,071 4.46% 4.46% 3.97%
Y ang Yi-fang /H1118/H1118/H1118Executive
Director and
Chief Executive
Officer
Beneficial
owner
A Shares 113,000 0.01% 0.01% 0.01%
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-11 –


--- page 2078 ---
Name Position
Nature
of interest
Description
of Shares
Number
of Shares
Approximate
percentage of
interest in the
total issued share
capital of our
Company as of
the Latest
Practicable Date
Approximate
percentage of
interest in the
A Shares
immediately
following the
completion of the
Global Offering
(assuming the
Offer Size
Adjustment
Option and the
Over-allotment
Option are not
exercised)
Approximate
percentage of
interest in the
total issued share
capital of our
Company
immediately
following the
completion of the
Global Offering
(assuming the
Offer Size
Adjustment
Option and the
Over-allotment
Option are not
exercised)
Lyu Xiaozhao /H1118/H1118Executive
Director, Vice
President and
Chief Engineer
Beneficial
owner
A Shares 111,700 0.01% 0.01% 0.01%
Gao Bo /H1118/H1118/H1118/H1118/H1118Executive
Director and
Vice President
Beneficial
owner
A Shares 153,500 0.01% 0.01% 0.01%
(b) Interests and short positions of the Substantial Shareholders in the Shares of our
Company
Save as disclosed in the section headed “Substantial Shareholders” in this Prospectus, our
Directors are not aware of any person who will, immediately following completion of the
Global Offering (assuming that the Offer Size Adjustment Option and the Over-allotment
Option are not exercised), have interests or short positions in our Shares or underlying Shares
which would be required to be disclosed to us and the Hong Kong Stock Exchange under the
provisions of Divisions 2 and 3 of Part XV of the SFO, or who is, directly or indirectly,
interested in 10% or more of the issued voting shares of our Company.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-12 –


--- page 2079 ---
(c) Interests of the Substantial Shareholders of any Member of Our Group (other than Our
Company)
Save as disclosed in the section headed “History, Development and Corporate Structure”
in this Prospectus and the table below, so far as our Directors are aware, immediately following
the completion of the Global Offering, no persons will, directly or indirectly, be interested in
10% or more of the nominal value of the share capital carrying rights to vote in all
circumstances at general meetings of any member of the Group (other than our Company).
Member of our Group Name of substantial shareholder
Approximate
percentage of
equity interests
held by the
substantial
shareholder
Xinhenghe Mining /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Liu Xin (ڦ30%
Li Y uanyuan ( ҽధధ) 12%
Zhu Jiande (ᅃ)7 %
Golden Star Resources /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Kefei Investment (BVI)
Limited (1)
38%
Note:
(1) Kefei Investment (BVI) Limited was wholly owned by China-Africa Fund for Industrial Cooperation
Co., Ltd. (“ CAFIC ”). CAFIC was held as to (i) 80% of the equity interest by Wutongshu Investment
Platform Company Limited (ப΂ʮ̡)( “ Wutongshu Investment ”), which was
wholly owned by the State Administration of Foreign Exchange Central Foreign Exchange Business
Center (̮ි၍ଣ҅ʕ̯̮ිุਕʕː); and (ii) 20% of the equity interest by the Export-Import
Bank of China ( ʕ਷ආ̈ɹვБ), which in turn was owned as to 89.26% and 10.74% equity interest by
Wutongshu Investment and MOF.
2. Particulars of Directors’ Service Contracts and Letters of Appointment
(a) Directors and Supervisors
We have entered into a service contract or letter of appointment with each of our Directors
and Supervisors in respect of, among other things (i) compliance of relevant laws and
regulations; (ii) observance of the Articles of Association; and (iii) provisions on arbitration.
The principal particulars of these service contracts and letters of appointment include (i) the
term of service; and (ii) are subject to termination in accordance with their respective term. The
service contracts or letters of appointment may be renewed in accordance with our Articles of
Association and the applicable Hong Kong Listing Rules.
Save as disclosed above, none of our Directors or Supervisors has entered into any service
contracts as a director or supervisor with any member of our Group (excluding contracts
expiring or determinable by the employer within one year without payment of compensation
(other than statutory compensation)).
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-13 –


--- page 2080 ---
(b) Others
(i) Save as disclosed above, none of our Directors and Supervisors has entered into any
service contract with any member of our Group (excluding contracts expiring or
determinable by the employer within one year without payment of compensation
other than statutory compensation).
(ii) For the three years ended December 31, 2023, for the nine months ended September
30, 2024, the aggregate of the remuneration and benefits in kind payable to our
Directors was approximately RMB26.89 million, RMB20.34 million, RMB20.95
million and RMB10.49 million, respectively. Details of our Directors’ remuneration
are also set out in Note 8 to the Accountant’s Report set out in Appendix IA to this
Prospectus.
(iii) For the three years ended December 31, 2023, for the nine months ended September
30, 2024, the aggregate of the remuneration and benefits in kind payable to our
Supervisors was approximately RMB3.99 million, RMB2.24 million, RMB1.56
million and RMB0.77 million, respectively.
(iv) None of our Directors and Supervisors has waived or agreed to waive any
emolument for each of the three financial years ended December 2023 and for the
nine months ended September 30, 2024.
(v) Save as disclosed herein and in Note 8 to the Accountant’s Report set out in
Appendix IA to this Prospectus, no other emoluments have been paid or are payable,
in respect of the years ended December 31, 2021, 2022 and 2023 and for the nine
months ended September 30, 2024 by us to our Directors or Supervisors.
(vi) Save as disclosed herein, no remuneration was paid by us to, or receivable by, our
Directors, Supervisors or the five highest paid individuals as an inducement to join
or upon joining our Company for each of the three financial years ended December
2023 and for the nine months ended September 30, 2024. No compensation was paid
by us to, or receivable by, our Directors, former Directors, Supervisors or the five
highest-paid individuals for each of the three financial years ended December 2023
and for the nine months ended September 30, 2024 for the loss of any office in
connection with the management of the affairs of any members of our Group.
(c) Based on the arrangements currently in force, the aggregate of the remuneration and
benefits in kind payable to our Directors for the year ending December 31, 2024 is
estimated to be approximately RMB15.74 million.
Based on the arrangements currently in force, the aggregate of the remuneration and
benefits in kind payable to our Supervisors for the year ending December 31, 2024 is
estimated to be approximately RMB1.32 million.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-14 –


--- page 2081 ---
(d) None of our Directors and our Supervisors or any past Directors and any past Supervisors
of any members of our Group has been paid any sum of money for the three years ended
December 31, 2023 and the nine months ended September 30, 2024 (i) as an inducement
to join or upon joining us or (ii) for loss of office as a Director and Supervisor of any
member of our Group or of any other office in connection with the management of the
affairs of any member of our Group.
(e) There has been no arrangement under which a Director and Supervisor has waived or
agreed to waive any remuneration or benefits in kind for the three years ended December
31, 2023 and nine months ended September 30, 2024.
(f) None of our Directors and Supervisors has been or is interested in the promotion of, or
in the property proposed to be acquired by, us, and no sum has been paid or agreed to be
paid to any of them in cash or shares or otherwise by any person either to induce him to
become, or to qualify him as, a Director or a Supervisor, or otherwise for services
rendered by him in connection with the promotion or formation of our Company.
3. Fees or commissions received
Save as disclosed in the section headed “History, Development and Corporate Structure”
in this Prospectus, none of our Directors, Supervisors or any of the persons whose names are
listed under the paragraph headed “D. Other Information — 7. Consent of Experts” in this
Appendix had received any commissions, discounts, agency fee, brokerages or other special
terms in connection with the issue or sale of any capital of any member of our Group within
the two years immediately preceding the date of this Prospectus.
4. Employee Stock Ownership Plans
Our Company adopted the Phase I ESOP , the Phase II ESOP and the Phase III ESOP on
October 13, 2020 (as revised on May 26, 2021, September 30, 2022 and April 20, 2023),
February 27, 2023 (as revised on March 20, 2023) and January 15, 2025, respectively.
The purpose of the ESOPs is to provide an incentive for the eligible participants (namely,
the Directors, Supervisors, senior management and key members of our Company and its
subsidiaries) a means through which our Group may grant incentives to attract, motivate, retain
and reward them. They aim to foster shared interests between our Shareholders and our
management team, thereby furthering our Company’s focus on long-term development.
As of the Latest Practicable Date, an aggregate of 15,192,600 A Shares (including 10,000
A Shares under Phase I ESOP and 15,182,600 A Shares under Phase III ESOP) were being held
under the ESOPs whilst Phase II ESOP had disposed of all the A Shares held by it by September
30, 2024. The ESOPs are not subject to the provisions of Chapter 17 of the Hong Kong Listing
Rules as they do not involve the grant of options by our Company to subscribe for new Shares
or award of Shares upon Listing.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-15 –


--- page 2082 ---
The key terms and implementation of the ESOPs are as follows.
(a) Plan limit
The maximum number of participants under the Phase I ESOP , the Phase II ESOP and the
Phase III ESOP shall not exceed 98, 120 and 210, respectively. Meanwhile, the maximum
number of A Share to be held by the Phase I ESOP , the Phase II ESOP and the Phase III ESOP
shall be 41,597,732 A Shares, 16,575,406 A Shares and 15,182,600 A Shares, accounting for
approximately 2.50%, 0.9962% and 0.9125% of our Company’s issued Share capital,
respectively.
The total number of Shares held by each of the ESOPs shall not exceed 10% of the issued
share capital of our Company. The maximum number of Shares corresponding to the awards
held an individual participant shall not exceed 1% of the issued share capital of our Company.
(b) Contribution of funds to the ESOP
The eligible participants shall use their salaries and personal funds to subscribe to the
ESOP , and obtain the corresponding interest in the ESOP .
(c) Source of Shares
The A Shares obtained by the ESOP shall be the A Shares repurchased by the Company
through centralized price bidding process.
The Phase I ESOP has entrusted an Independent Third Party professional institution with
asset management qualifications to establish a directional plan available for subscription by the
eligible participants. Within six months from the approval of the ESOP by the general meeting,
the directional plan would obtain and hold the A Shares repurchased by our Company through
a block trade process. Such funds would not be used to purchase the shares of other companies.
The Phase II ESOP and the Phase III ESOP are maintained by our Company. The
management committee of Phase II ESOP shall the asset manager and exercise all
shareholders’ rights in relation to the A Shares held by the plan. It would set up a securities
account designated for the plan of the Company whereby the A Shares repurchased by our
Company are obtained by the plan by non-transactional transfer means and other means as
permitted under applicable laws and regulations.
The purchase price of such A Shares by the ESOP shall be the average price paid by our
Company for the repurchase of such Shares.
As of April 30, 2021, April 28, 2023 and June 27, 2024, our Company repurchased a total
of 41,597,732, 16,575,406 and 15,182,600 A Shares for the purpose of the Phase I ESOP , the
Phase II ESOP and the Phase III ESOP , respectively.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-16 –


--- page 2083 ---
Upon the expiry of the lock-up period, various A Shares had been disposed of by the
Phase I ESOP and the Phase II ESOP and as of the Latest Practicable Date, the Phase I ESOP
held 10,000 A Shares whilst the Phase II ESOP had disposed of all the 16,575,406 A Shares
held by it and did not hold any Shares.
(d) Term
The term of the Phase I ESOP shall be 36 months and the term of each of the Phase II
ESOP and the Phase III ESOP shall be 24 months, commencing from the date when the
respective ESOP is approved by the general meeting and the Company announcing the transfer
of the last batch of the subject Shares to the ESOP , respectively.
Upon expiry of the lock-up period, the ESOPs can be terminated early if all the Shares
held by the ESOPs are disposed of, and all assets (if any) held by the ESOPs are in the form
of cash and have been liquidated or distributed.
(e) Lock-up period
The lock-up period for each of the ESOPs is 12 months from the date when the ESOP (as
revised) is approved by the general meeting and our Company announces the transfer of the last
batch of subject Shares to the ESOP .
Upon expiry of the lock-up period and prior to the expiration of the term of the ESOP , the
management committee of the ESOP (see below) may, upon authorization from the resolutions
of the participants, sell or transfer the Shares held by the ESOP as it deems appropriate.
(f) Performance target
The entitlement to the corresponding benefits from the ESOP by the participants shall be
subject to the following performance targets:
 For the Phase I ESOP , if our Company’s cumulative gold production from 2022 to
2024 is not less than 43 tonnes, the plan could distribute an amount equivalent to the
entire accumulated equity interest in the subject Shares after repaying the financing
principal and interest of the directional plan.
 For the Phase II ESOP , if our Company realizes an increase in net profit attributable
to Shareholders of the listed company by 30% or above in 2023 when compared to
that of the previous year, the plan could distribute an amount equivalent to the entire
accumulated equity interest in the subject Shares.
 For the Phase III ESOP , if our Company’s gold production for 2025 realizes a
growth of 5% or above from that for 2024, the plan could distribute an amount
equivalent to the entire accumulated equity interest in the subject Shares.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-17 –


--- page 2084 ---
(g) Management committee
Each of the ESOPs have established a management committee to oversee the daily
management of the ESOP . The committee consists of three members who are elected through
resolutions of the participants. Resolutions may only be passed by the management committee
when majority members voting in favour of such resolution, and each management committee
member shall have one vote.
The management committee is responsible for the daily management of the ESOP ,
including: (i) supervising the daily management of the ESOP on behalf of all its participants,
(ii) exercising the shareholder rights in respect of the Shares held by the plan; (iii) managing
the distribution of benefits from the ESOP; and (iv) making decision as to the disposal of the
Shares held by the ESOP upon expiry of the lock-up period in accordance with the terms of the
ESOP , any and all rights pertaining to the A Shares held by the ESOP , including the voting
rights, the dividend rights and the rights to dispose of such Shares, rest solely in the
management committee instead of the individual participants.
Save for (i) Mr. Zhao Qiang who is a director of Chijin Xiawu and serves as a
management committee member of the Phase I ESOP; (ii) Mr. Zhou Xinbing who is a director
of Chijin HK and LXML and serves as a management committee member of the Phase I ESOP;
and (iii) Mr. Dong Shubao who is a director of Chijin Xiawu and serves as a management
committee member of the Phase I ESOP , none of the management committee members of the
ESOPs is a core connected person of our Company.
(h) Distribution
During the term of the ESOP , unless otherwise stipulated by laws, administrative
regulations, departmental rules, or with the consent of the management committee, the
corresponding interest in the plan held by the participants shall not be transferred, used as
collateral, or otherwise disposed of in a similar manner.
During the term of the ESOP , participants shall not request for distribution of the equity
interest in the Shares held by the ESOP .
Upon expiry of the term of the ESOP , if the assets (if any) held by the ESOP still include
the Shares, the management committee shall determine the disposal method of such Shares.
The management committee may also, with the authorization from the resolution of the
participants, liquidate the plan within 30 working days from such expiration date, after
deducting relevant taxes and fees as required by the law. The distribution of the proceeds from
the aforesaid disposal shall be based on the fulfillment of the performance target and the
corresponding interest in the plan held by individual participants. Given that the distribution
shall only be made after the term of the ESOP when the Shares held by the ESOP Platform had
been disposed of, fulfillment of the performance target will not lead to a drop in the public float
of the Company.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-18 –


--- page 2085 ---
5. Disclaimers
Save as disclosed in this Prospectus:
(a) none of our Directors or Supervisors has any interests and short positions in the
Shares, underlying Shares and debentures of our Company or its associated
corporation (within the meaning of Part XV of the SFO) which will have to be
notified to us and the Hong Kong Stock Exchange pursuant to Divisions 7 and 8 of
Part XV of the SFO (including interests and short positions which he is taken or
deemed to have under such provisions of SFO) or which will be required, pursuant
to section 352 of the SFO, to be entered in the register referred to therein, or will
be required, pursuant to the Model Code for Securities Transactions by Directors of
Listed Issuers to be notified to us and the Hong Kong Stock Exchange, in each case
once our Shares are listed on the Hong Kong Stock Exchange;
(b) none of our Directors, Supervisors or any of the parties listed in the paragraph
headed “D. Other Information — 7. Consent of Experts” in this Appendix is
interested in our promotion, or in any assets which have, within the two years
immediately preceding the issue of this Prospectus, been acquired or disposed of by
or leased to us, or are proposed to be acquired or disposed of by or leased to us;
(c) save in connection with the Underwriting Agreements, none of our Directors,
Supervisors or any of the parties listed in the paragraph headed “D. Other
Information — 7. Consent of Experts” of this Appendix is materially interested in
any contract or arrangement subsisting at the date of this Prospectus which is
significant in relation to the business of our Group;
(d) save in connection with the Underwriting Agreements, none of the parties listed in
the paragraph headed “D. Other Information — 7. Consent of Experts” in this
Appendix: (i) is interested legally or beneficially in any of our Shares or any shares
in any of our subsidiaries; or (ii) has any right (whether legally enforceable or not)
to subscribe for or to nominate persons to subscribe for securities in any member of
our Group;
(e) taking no account of any Shares which may be taken up under the Global Offering,
so far as is known to any of our Directors or Supervisors, no person has an interest
or short position in the Shares and underlying Shares which would fall to be
disclosed to us and the Hong Kong Stock Exchange under the provisions of
Divisions 2 and 3 of Part XV of the SFO, or is, directly or indirectly, interested in
10.00% or more of the nominal value of any class of share capital carrying rights to
vote in all circumstances at general meetings of any other member of the Group; and
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-19 –


--- page 2086 ---
(f) save as disclosed in the paragraphs headed “— Sales and Customers — Customers”
and “— Procurement and Suppliers — Suppliers” in this Prospectus, none of our
Directors, Supervisors or their respective associates or any of our Shareholders (who
to the knowledge of our Directors owns more than 5.00% of our issued share capital)
has any interest in our five largest suppliers or our five largest customers.
D. OTHER INFORMATION
1. Estate Duty
We have been advised that no material liability for estate duty under PRC law is likely
to fall upon us.
2. Litigation
During the Track Record Period and up to the Latest Practicable Date, saved as disclosed
in this Prospectus and so far as our Directors are aware, no litigation, arbitration proceedings
or claim of material importance (to our Group’s financial condition or results of operation) is
pending or threatened against any member of our Group.
3. Sole Sponsor
The Sole Sponsor has made an application on our behalf to the Listing Committee for the
listing of, and permission to deal in, the Shares in issue and to be issued as mentioned in this
Prospectus (including any H Shares which may be issued pursuant to the exercise of the Offer
Size Adjustment Option and/or the Over-allotment Option).
The Sole Sponsor satisfies the independence criteria applicable to sponsors set out in Rule
3A.07 of the Hong Kong Listing Rules. The fees to the Sole Sponsor are approximately
US$500,000 and will be borne by our Company.
4. Preliminary expenses
We did not incur any material preliminary expenses in relation to the incorporation of our
Company.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-20 –


--- page 2087 ---
5. Promoters
Information of our promoters as of the time of our Company’s conversion into a joint
stock company on August 23, 2000 is as follows:
No. Name
1. Guangdong Jin’an Automobile Industrial Engineering Company Limited (؇
ʮ̡)
2. Huang Yizhen (ޜ)
3. Y ang Wenjiang ( เ˖Ϫ)
4. Y ang Wenying (ߵ)
5. Y ang Jinpeng (؃ږ)
Save as disclosed in the sections headed “History, Development and Corporate Structure”
and “Financial Information — Dividend” in this Prospectus, within the two years immediately
preceding the date of this Prospectus, no cash, securities or other benefit has been paid, allotted
or given nor are any proposed to be paid, allotted or given to any promoters in connection with
the Global Offering and the related transactions described in this Prospectus.
6. Qualification of Experts
The following are the qualifications of the experts who have given opinion or advice
which are contained in this Prospectus:
Name Qualifications
CITIC Securities (Hong Kong) Limited /H1118/H1118Licensed corporation under the SFO to
engage in type 4 (advising on
securities) and type 6 (advising on
corporate finance) regulated activities
Ernst & Y oung /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Certified Public Accountants and
Registered Public Interest Entity
Auditor
Beijing Tian Y uan Law Firm /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Legal Advisor as to PRC laws
REM Law Consultancy /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Legal Advisor as to Ghana laws
ZICOLaw (Laos) Sole Co., Ltd. /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Legal Advisor as to Laos laws
Frost & Sullivan (Beijing) Inc., Shanghai
Branch Co. /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Independent industry consultant
SRK Consulting (China) Ltd. /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Competent person (with the meaning of
Chapter 18 of the Hong Kong Listing
Rules)
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-21 –


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7. Consent of Experts
Each of the experts named in the paragraph headed “D. Other Information — 6.
Qualification of Experts” in this Appendix has given and has not withdrawn its respective
written consent to the issue of this Prospectus with the inclusion of its report and/or letter
and/or opinion and/or the references to its name included in this Prospectus in the form and
context in which it is respectively included. Each of the experts named in the paragraph headed
“D. Other Information — 6. Qualification of Experts” in this Appendix has given and has not
withdrawn its respective written consent to the issue of this Prospectus with the inclusion of
its report and/or letter and/or opinion and/or the references to its name included in this
Prospectus in the form and context in which it is respectively included.
As of the Latest Practicable Date, none of the experts named above has any shareholding
interests in any member of our Group or the right (whether legally enforceable or not) to
subscribe for or to nominate persons to subscribe for securities in any member of our Group.
8. Binding Effect
This prospectus shall have the effect, if an application is made in pursuance of this
Prospectus, of rendering all persons concerned bound by all of the provisions (other than the
penal provisions) of sections 44A and 44B of the Companies (Winding Up and Miscellaneous
Provisions) Ordinance insofar as applicable.
9. Taxation of holders of H Shares
The sale, purchase and transfer of H Shares are subject to Hong Kong stamp duty if such
sale, purchase and transfer are affected on the H Share register of members of our Company,
including in circumstances where such transactions are effected on the Hong Kong Stock
Exchange. The current rate of Hong Kong stamp duty for such sale, purchase and transfer on
each of the purchaser and the seller is 0.1% of the consideration or, if higher, the fair value of
the H Shares being sold or transferred.
10. Bilingual prospectus
The English language and Chinese language versions of this Prospectus are being
published separately, in reliance upon the exemption provided by section 4 of the Companies
(Exemption of Companies and Prospectuses from Compliance with Provisions) Notice
(Chapter 32L of the Laws of Hong Kong).
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-22 –


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E. RELATED PARTY TRANSACTIONS
Our Group entered into the related party transactions within the two years immediately
preceding the date of this Prospectus as mentioned in Note 46 to the Accountants’ Report set
out in Appendix IA to this Prospectus.
F. MISCELLANEOUS
(a) Save as disclosed in the section headed “History, Development and Corporate
Structure” in this Prospectus, within the two years immediately preceding the date
of this Prospectus:
(i) no share or loan capital of our Company or any of its subsidiaries has been
issued or agreed to be issued or is proposed to be fully or partly paid either for
cash or a consideration other than cash;
(ii) no share or loan capital of our Company or any of its subsidiaries is under
option or is agreed conditionally or unconditionally to be put under option;
(iii) no founders or management or deferred shares of our Company or any of its
subsidiaries have been issued or agreed to be issued;
(iv) no commissions, discounts, brokerages or other special terms have been
granted (except in connection with the Underwriting Agreements) or agreed to
be granted in connection with the issue or sale of any share or loan capital of
our Company or any of its subsidiaries; and
(v) no commission has been paid or is payable for subscription, agreeing to
subscribe, procuring subscription or agreeing to procure subscription of any
share in our Company or any of its subsidiaries.
(b) Our Group had not issued any debentures nor did it have any outstanding debentures
or any convertible debt securities.
(c) Our Directors confirm that:
(i) there has been no material adverse change in the financial or trading position
or prospects of the Group since September 30, 2024 (being the date to which
the latest audited consolidated financial statements of the Group were
prepared);
(ii) there is no arrangement under which future dividends are waived or agreed to
be waived; and
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-23 –


--- page 2090 ---
(iii) there has not been any interruption in the business of the Group which may
have or has had a significant effect on the financial position of the Group in the
12 months preceding the date of this Prospectus.
(d) All necessary arrangements have been made to enable our H Shares to be admitted
into CCASS for clearing and settlement.
(e) Save for our A Shares which are listed on the Shanghai Stock Exchange and the H
Shares to be issued in connection with the Global Offering, none of our equity and
debt securities is listed or dealt with in any other stock exchange nor is any listing
or permission to deal being or proposed to be sought.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-24 –


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A. DOCUMENTS DELIVERED TO THE REGISTRAR OF COMPANIES
The documents attached to the copy of this Prospectus delivered to the Registrar of
Companies in Hong Kong for registration were, among other documents:
(a) the written consents referred to in the paragraph headed “D. Other Information —
7. Consent of Experts” in Appendix VII to this Prospectus; and
(b) a copy of each of the material contract referred to in the paragraph headed “B.
Further Information about our Business — 1. Summary of our Material Contracts”
in Appendix VII to this Prospectus.
B. DOCUMENTS ON DISPLAY
Copies of the following documents will be published at the websites of the Hong Kong
Stock Exchange at www.hkexnews.hk and our Company at cfgold.com up to and including the
date which
(a) the Articles of Association;
(b) the Accountant’s Report prepared by Ernst & Y oung, the text of which is set out in
Appendix IA to this Prospectus;
(c) the audited consolidated financial statements of our Group for the years ended
December 31, 2021, 2022 and 2023 and the nine months ended September 30, 2024;
(d) the accountants’ report of Golden Star Resources for the year ended December 31,
2021 and the one month ended January 31, 2022 prepared by Ernst & Y oung, the text
of which is set out in Appendix IB to this Prospectus;
(e) the report on unaudited pro forma financial information of our Group prepared by
Ernst & Y oung, the text of which is set out in Appendix IIA to this Prospectus;
(f) the letters from Ernst & Y oung and the Sole Sponsor relating to the profit estimate
of our Group for the year ended December 31, 2024, the text of which is set out in
Appendix IIB to this Prospectus;
(g) the written consents referred to in the paragraph headed “D. Other Information —
7. Consent of Experts” in Appendix VII to this Prospectus;
(h) the service contracts and letters of appointment referred to in the paragraph headed
“C. Further Information about our Directors, Supervisors and Substantial
Shareholders — 2. Particulars of Directors’ Service Contracts and Letters of
Appointment” in Appendix VII to this Prospectus;
APPENDIX VIII DOCUMENTS DELIVERED TO THE REGISTRAR OF
COMPANIES AND A V AILABLE ON DISPLAY
– VIII-1 –


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(i) the material contracts referred to in the paragraph headed “B. Further Information
about our Business — 1. Summary of our Material Contracts” in Appendix VII to
this Prospectus;
(j) the legal opinion issued by Beijing Tian Y uan Law Firm, our legal advisor as to PRC
laws, in respect of certain aspects of the PRC operations and property interests of
our Group;
(k) the legal opinion issued by REM Law Consultancy, our legal advisor as to Ghana
laws, in respect of certain aspects of the Ghana operations of our Group;
(l) the legal opinion issued by ZICOLaw (Laos) Sole Co., Ltd., our legal advisor as to
Laos laws, in respect of certain aspects of the Laos operations of our Group;
(m) the industry report issued by Frost & Sullivan (Beijing) Inc., Shanghai Branch Co.
referred to in the section headed “Industry Overview” in this Prospectus;
(n) the Competent Person’s Report for the PRC Mines prepared by SRK Consulting
(China) Ltd., the texts of which are set out in Appendix IIIA to this Prospectus;
(o) the Competent Person’s Report for the Sepon Gold and Copper Mine prepared by
SRK Consulting (China) Ltd., the texts of which are set out in Appendix IIIB to this
Prospectus;
(p) the Competent Person’s Report for the Wassa Gold Mine prepared by SRK
Consulting (China) Ltd., the texts of which are set out in Appendix IIIC to this
Prospectus;
(q) the Competent Person’s Report for the Sepon Rare Earth Element and Mengkham
Rare Earth Element Projects in Lao People’s Democratic Republic prepared by SRK
Consulting (China) Ltd., the texts of which are set out in Appendix IIID to this
Prospectus;
(r) the terms of the ESOPs; and
(s) the PRC Company Law, the PRC Securities Law, the Guidelines on the Bylaws of
Listed Companies, the Trial Administrative Measures of Overseas Securities
Offering and Listing by Domestic Companies and the Guidelines for Articles of
Association, together with unofficial English translations thereof.
APPENDIX VIII DOCUMENTS DELIVERED TO THE REGISTRAR OF
COMPANIES AND A V AILABLE ON DISPLAY
– VIII-2 –


--- page 2093 ---
赤峰吉隆黃金礦業股份有限公司
Chifeng Jilong Gold Mining Co., Ltd.
