Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Safety

Environmental Achievements

• No lost time injuries during 804,842 man-hours of plant construction and 218,387 man-hours of production; Established a CSR Committee; Developed a Group CSR policy and EMS based on ISO 14001; Implemented environmental monitoring program approved by local authorities.

Social Achievements

• Maintained constructive relations with Kounrad community and authorities; Donated generously to local causes ($38,928); Developed a Social Management System (SMS) with stakeholder engagement plan.

Governance Achievements

• Established a CSR Committee; Developed a Group CSR policy; Implemented a safety conscious approach with induction and refresher courses for all employees; Conducted an independent safety audit and implemented all recommendations.

Climate Goals & Targets

Environmental Challenges

• Harsh winter weather conditions at Kounrad; Delays in transferring 40% ownership of Kounrad project from SAT Group to CAML; Challenging business environment in Mongolia hindering disposal of non-core assets; Uncertainty in Mongolia around new mining code and foreign ownership laws; Claim filed against ZunnMod UUL Ltd (Ereen project) by a minority shareholder.

Mitigation Strategies

• Incorporated an 8.4MW coal-fired boiler house in Kounrad plant design to manage winter conditions; Working to complete the transfer of ownership of Kounrad project with SAT Group; Continuing discussions with MRC for sale of Mongolian assets; Complying with all relevant legislation and maintaining close ties with government contacts; Intending to fully defend the claim against ZunnMod UUL Ltd.

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: ISO 14001

Environmental Metrics

ESG Focus Areas

• Social and environmental responsibility
• Community engagement
• Workforce diversity
• Environmental monitoring and remediation

Environmental Achievements

• Proactive environmental monitoring and remediation programmes
• Positive review received by independent consultants in respect of CSR policy

Social Achievements

• Over 95% of 338-strong workforce recruited from local communities
• Over 60% of procurement from within Kazakhstan
• Continuing engagement in community projects: over $100,000 spent on computer class equipment and gymnasium refurbishment for the local school, and on supporting WWII veterans
• Strong focus on training and education, with two employees on sponsored MBA courses

Governance Achievements

• Not disclosed

Climate Goals & Targets

Environmental Challenges

• Reduction in copper prices
• Electricity costs increased by 15%
• Increased production staff of 13%
• Seasonal dip in PLS flow-rate during winter

Mitigation Strategies

• CAML Hedging policy
• Reagent costs reduced by 9%
• Selling & Distribution costs reduced by 13%
• Installation of two additional boilers to reduce winter dip in PLS flow-rate

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Over 60% of procurement from within Kazakhstan

Climate-Related Risks & Opportunities

Physical Risks

• Seasonal dip in PLS flow-rate during winter (freezing potential)

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: Null

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Corporate Social Responsibility (CSR)
• Health and Safety
• Environmental Protection
• Community Engagement

Environmental Achievements

• Relining of raffinate and emergency ponds with double liner of clay and HDPE
• Improvements to the waste disposal and waste management system
• Further refinements of the extensive groundwater monitoring programme
• Invested in the onsite laboratory with the purchase of a spectrometer

Social Achievements

• Contributed close to $1 million towards social programmes and the local community
• Currently employ approximately 276 staff, the majority of whom have been recruited locally
• Donations to Kounrad village school kitchen, local youth parachute club, Balkhash orphanage, Bora Zhan centre for children with disabilities, and others.
• Quarterly safety award for best safety suggestion

Governance Achievements

• Appointment of Roger Davey as Non-Executive Director and Chairman of the CSR Committee
• Strengthened the CAML Board with the appointment of Roger Davey
• Record copper cathode production of 12,071 tonnes (2014: 11,136 tonnes)

Climate Goals & Targets

Environmental Challenges

• Fall in copper price
• Production incident in June 2015 impacting production
• Leaching cycle taking longer than originally projected
• Kazakhstan Tenge devaluation

Mitigation Strategies

• Focus on cost control and operational efficiency
• Steps taken to eliminate possibility of similar accident recurring
• Consistent monitoring and analysis of copper leaching rate
• Increased salaries for staff at Kounrad by 25% from 1 January 2016

Supply Chain Management

Climate-Related Risks & Opportunities

Awards & Recognition

• Kounrad Copper Company ranked first place for contributing the highest amount of corporate income tax for a medium size business during 2013-2014

Environmental Metrics

ESG Focus Areas

• Safety
• Environmental
• Community Development

Environmental Achievements

• 124 environmental inspections undertaken at Kounrad in 2016 with no major issues raised
• Improvements in recycling including donating ash from the boilers to the local community in order to make bricks for construction
• Development of the environmental monitoring network for the area that will be leached in 2017 and ensuring the baseline environmental conditions are clearly established

Social Achievements

• 1.45 million LTI free man hours worked at Kounrad
• 25% pay rise for staff at Kounrad to compensate them for the devaluation in the local currency
• Numerous health and safety inspections during 2016
• Social contributions of $0.2m in 2016, totaling $1.2m to date
• Three fully staffed medical clinics on site
• Regular engagement with stakeholders in Kounrad and Balkhash as well as regionally and nationally

Governance Achievements

• Changes to Board structure: Nick Clarke transitioned from CEO to Executive Chairman; Nigel Hurst-Brown became Deputy Chairman; Gavin Ferrar joined the Board as Business Development Director.
• Succession planning commenced at Board level

Climate Goals & Targets

Environmental Challenges

• Varying grades and flows of copper bearing solution from the dumps; potential reduction in copper cathode produced.
• Interruption to the project’s water supply could have an adverse impact on leaching operations.
• Loss of critical supplies (reagents and electricity) in SX-EW operations.
• Significant risk of fire in SX operations.
• Potential health and safety incidents involving employees.
• Potential for community unhappiness impacting operations.
• Careful management of in-situ leaching operations to avoid environmental impact.
• Susceptibility to adverse changes in Kazakhstan’s political or business environment.
• Fluctuation in copper prices impacting revenue.
• Changes to Kazakhstan’s taxation system.

Mitigation Strategies

• Extensive testing on grades and expected recovery of copper; regular review of leaching performance.
• Construction of a second water source from Lake Balkhash.
• Review of critical spare parts and implementation of changes; installation of generator capability.
• Comprehensive fire detection and fighting system; business interruption insurance; improvements to fire detection and control.
• Emphasis on health and safety; proactive health and safety approach.
• Strong emphasis on engagement with the local community.
• Strong emphasis on protecting the environment; detailed hydrogeological risk assessment; comprehensive monitoring and control program.
• Assessment of opportunities for expanding the Company’s asset base outside of Kazakhstan; extensive network of business contacts in Kazakhstan.
• Treasury policy allowing limited hedging up to 30% of Kounrad’s rolling 12-month production.
• Compliance with all tax regulations; adequate training of local accounting staff; tax advice from advisors in Kazakhstan.

Supply Chain Management

Climate-Related Risks & Opportunities

Awards & Recognition

• Ranked first place in Kazakhstan’s national business ratings

Environmental Metrics

ESG Focus Areas

• Health and Safety
• Environmental Protection
• Community Relations

Environmental Achievements

• Completed Stage 2 Expansion at Kounrad, leaching operations commenced on Western Dumps
• No environmental incidents reported at Sasa
• Planted 2,000 acacia trees at Sasa TSF 1
• Continued groundwater monitoring at Kounrad

Social Achievements

• 2.0 million LTI-free man-hours at Kounrad
• 1.8 million LTI-free man-hours at Sasa
• Invested $80,000 in recreational areas in Balkhash
• Supported local sporting activities in Macedonia ($120,000)
• Established charitable foundation in Kazakhstan

Governance Achievements

• Completed $402.5 million acquisition of Lynx Resources
• Won Mid-Cap Deal of the Year Award

Climate Goals & Targets

Environmental Challenges

• Varying grades and flows of copper-bearing solution at Kounrad
• Risks and hazards associated with mining and mineral processing at Sasa
• Potential for fire at Kounrad SX operations
• Potential for environmental impact from leaching operations at Kounrad
• Political and country risk in Kazakhstan and Macedonia
• Commodity price fluctuations
• Taxation regulations in Kazakhstan and Macedonia
• Changes to key personnel

Mitigation Strategies

• Extensive testing and consultant review of leaching performance at Kounrad
• Second water source for Kounrad leaching operations
• Focus on maximizing productivity and adhering to safety standards at Sasa
• External technical reports and integration processes for Sasa
• Review of supply chains and critical spares
• Generator capability at Kounrad and Sasa
• Comprehensive fire detection and fighting system
• Business interruption insurance
• Emphasis on health and safety and community engagement
• Appropriate authorisations to extract metal in both countries
• Regular contact with authorities
• Construction of new tailings storage facility at Sasa
• High standards for staff recruitment and training
• Limited funds in currencies other than US Dollars
• Compliance with tax regulations and tax advice from local advisors

Supply Chain Management

Climate-Related Risks & Opportunities

Awards & Recognition

• Mid-Cap Deal of the Year Award

Environmental Metrics

ESG Focus Areas

• Health and Safety
• Environmental Responsibility
• Community Engagement

Environmental Achievements

• No Lost Time Injuries (LTIs), exceeding 1.7 million LTI-free man-hours.
• Environmental and hydrogeological site investigations commenced in conjunction with SRK Consulting, focusing on the Western Dumps.

Social Achievements

• Continued active engagement with the local community, focusing on health and education, particularly for children.

Governance Achievements

• Not disclosed

Climate Goals & Targets

Environmental Challenges

• Slightly higher electricity consumption and additional labor costs to manage the Western Dumps operations due to commencement of production.

Mitigation Strategies

• Not disclosed

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Not disclosed

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: Null

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Economic performance
• Caring for our communities
• Governance
• Environmental
• Our employees

Environmental Achievements

• Adherence to high international standards in Kazakhstan
• ISO14001:2015 compliant in North Macedonia

Social Achievements

• $0.6m spent in 2018 in North Macedonia and Kazakhstan
• Kounrad Charitable Foundation developed
• Support for disabled children and orphans in Balkhash
• New recreational areas in Kazakhstan and North Macedonia
• Sponsorship of mining students at Stip University
• TRIFR 3.76
• New hires in H&S
• Employee training
• 20% female employees at Kounrad
• 50% female in London head office
• Distribution of employee newsletters
• Low staff turnover

Governance Achievements

• Strong Board of experienced independent directors with wide-ranging skills
• Transparent disclosure
• Risk management
• Adherence to QCA code
• Fully compliant with all local tax laws

Climate Goals & Targets

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Modern Slavery
• Human Rights
• Responsible Supply Chains

Social Achievements

• Commissioned benchmarking studies to ensure competitive pay.
• Implemented online corporate governance training for senior management and employees on human rights and modern slavery.
• Introduced human rights and modern slavery training to on-site contractors.
• Entrenched human rights and supply chain integrity into Key Performance Indicators for long-term incentive plans.

Governance Achievements

• Introduced a Supplier Code of Conduct requiring new suppliers to sign a declaration of compliance.
• Improved sourcing and vetting processes within the procurement function.
• Implemented a Whistleblowing Policy with an anonymous external hotline.

Climate Goals & Targets

Environmental Challenges

• Potential human rights risks associated with working in the extractives industry across jurisdictions.
• Risk of modern slavery in supply chains.

Mitigation Strategies

• Active steps taken in line with the UN Guiding Principles to ensure business operations do not cause, contribute to, or are directly linked to human rights abuse.
• Improved sourcing and vetting processes.
• Supplier Code of Conduct with social assessment component.
• Annual letters to top 30 suppliers to share policies and request information on human rights efforts.
• Increased on-site stewardship to identify emerging human rights risks.
• Internal human rights impact assessment every three years.

Supply Chain Management

Responsible Procurement

• Due Diligence Guidance
• Robust Procurement Policies
• Supplier Code of Conduct
• Social assessment component in prequalification questions

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: UN Guiding Principles