Unkurtash Project Update March 2017 Disclaimer Certain statements - PowerPoint PPT Presentation

Unkurtash Project Update March 2017

Disclaimer Certain statements within this presentation constitute forward looking statements. Such forward looking statements involve risks and other factors which may cause the actual results, achievements or performance of the Group to be materially different from any future results, achievements or performance expressed or implied by such forward looking statements. Such risks and other factors include, but are not limited to, general economic and business conditions, changes in government regulations, currency fluctuations, the gold price, the Group’s ability to recover its reserves or develop new reserves, competition, changes in development plans and other risks. There can be no assurance that the results and events contemplated by the forward looking statements contained in this presentation will, in fact, occur. These forward-looking statements are correct or represent honestly held views only as at the date of delivery of this presentation. The Company will not undertake any obligation to release publicly any revisions to these forward looking statements to reflect events, circumstances and unanticipated events occurring after the date of this presentation except as required by law or by regulatory authority. Nothing in this presentation constitutes an offer, invitation, recommendation to purchase, sell or subscribe for any securities in any jurisdiction or solicitation of any offer to purchase, sell or subscribe for any securities in any jurisdiction and neither the issue of the information nor anything contained herein shall form the basis of or be relied upon in connection with, or act as any inducement to enter into, any investment activity. 2

Table of Contents Pages Content Investment Highlights 4 Project Summary 5 Unkurtash Overview 6 Acquisition & Development History 7 Licenses 8 Exploration 9 Geological Setting & Mineralisation 10 Mineral Resource Estimate 11 Geography & Climate 12 Mining 13 Processing & Infrastructure 14 General Layout 15 16 – 17 Financial Model Output 19 – 21 Appendices 3

Investment Highlights Sizeable gold project with average annual gold production of >130 koz and 18 years of 1 mine life 2 Top tier LOM AISC cash cost position of ~US$660/oz 3 Favourable processing with predominantly free gold amenable for conventional processing Located in existing mining area with access to infrastructure such as roads, power and 4 water supply and existing plans for upgrades Competitive development capex intensity of ~US$126/oz for total LOM gold production of 5 ~2.4 mmoz 6 Local mine management team with extensive experience in the Kyrgyzstan mining industry 4

Project Summary  Unkurtash Project (“Unkurtash” or the “Project”) is a large -scale gold project located in West Kyrgyzstan and is 100% owned by Highland Gold (“Highland Gold” or the “Group”) – The Project comprises three deposits: Unkurtash, Sarytube and Karatube – The deposits’ licenses are held by Highland Exploration Kyrgyzstan LLC which is a 100% owned subsidiary of Highland Gold  Since obtaining the assets’ licenses in 2006, Highland Gold has engaged in continuous exploration works – In June 2013, IMC Montan prepared a JORC gold resources estimate of ~3.5 mmoz (~109 tonnes) contained gold at a grade of 1.82 g/t  SRK completed a Scoping Study on Unkurtash in January 2017 with the following key economics: – Project NPV of US$200 mm assuming a gold price of US$1,200/oz (1) and a discount rate of 10% – Envisaged open pit mining with an average annual gold production of ~130 koz – 18-year mine life – Gravity concentration and gravity tailings CIL with 4 mtpa throughput as a favoured processing technology – Initial estimated development capex of US$322 mm (2)  Additional drilling programme planned for 2017 will position project well for advancement to PFS / DFS stage  Highland Gold is considering various strategic alternatives for proceeding with the project, including partnering with another strategic investor to co-develop Unkurtash 1. NPV of US$298 mm based on flat LT consensus price case of US$1,300/oz. 5 2. Includes contingencies of ~US$20 mm.

Unkurtash Overview Overview Project Location  JORC resources (IMC, 2013) of ~3.5 mmoz (~109 tonnes) contained KAZAKHSTAN gold at a grade of 1.82 g/t Karatube \ Sarytube Bishkek Taskomur  In March 2017, SRK completed a scoping study on the project, Dzhalal-Abad Tereksay demonstrating its robust economics (1) : Osh KYRGYZSTAN Terek CHINA – NPV of US$200 mm at 10% discount TAJIKISTAN Ishtamberdy Buzuk – IRR of ~19% Unkurtash – TCC of US$616/oz and AISC of US$662/oz Dzhoy-Belent Terekkan & Perevalniy – Development capex of US$322 mm (2) with total LOM capex of Ala-Buka US$472 mm (3) Kyizyil-Tokoy 0 5 10km  Project has access to significant supporting infrastructure: KYRGYZSTAN – Locally situated in renowned mining district adjacent to Terekkan / Company Deposits Perevalniy (to be commissioned in 2017), Ishtamberdy and Operating Mine Bozymchak operating mines Cities Bozymchak – Kasansay Good site access via extensive network of paved roads (4) Roads – Nearby village Tereksay serves as base camp Rivers Sumsar – 110 kV grid line along Kassan river valley (5) Resources (7) Production & Cash Cost Profile Ore Grade Contained Au Contained Au Production (koz) TCC (US$/oz) (1) 204 180 (kt) (g/t Au) (kg) (koz) 162 Measured 19,256 1.83 35,324 1,136 145 138 138 138 141 132 121 113 134 124 125 125 121 118 Indicated 29,639 1.84 54,533 1,753 $800 $748 $732 $704 $694 $691 $675 $665 $673 $659 M&I 48,895 1.84 89,857 2,889 $615 $601 $597 $576 $512 $435 $427 $408 Inferred 11,137 1.74 19,416 624 -- Grand Total 60,032 1.82 109,273 3,513 28 (6) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 Year Connection to the “Crystal” substation located ~150 km from the deposit 1. Based on US$1,200/oz gold price assumption. 5. 2. Includes contingencies of ~US$20 mm. is recommended to meet the estimated 23-25 MW power demand. 6 3. Includes reclamation costs of ~US$20 mm. 6. Project construction takes place during year 1. 4. Only the last 25 km are unpaved; asphalt road to be completed in 2 years. 7. As per IMC Mineral Resource Statement 2013.

Acquisition & Development History Unkurtash Acquisition through Highland Gold  The Unkurtash deposit was discovered during prospecting work that was carried out in 1980-1983  Barrick Gold acquired the Unkurtash licenses in 2002 with a subsequent exploration programme  Highland Exploration Kyrgyzstan LLC (former Barrick Gold Kyrgyzstan LLP), including the Unkurtash licenses, was acquired in 2006 as a result of an asset exchange transaction with Barrick Gold Development History  From 2002-2012 the primary focus was on prospecting and exploring the Unkurtash and Karatube license areas – 110,175 m drilled over 469 holes resulting in 99,890 core and RC samples being taken  From 2009-2012 test works were carried out by reputable industry contractors (TOMC, SGS, etc.), to determine an appropriate process route and recovery rates – Works identified gravity and gravity tailings CIL as the favourable processing method  In 2011, Highland Gold submitted “TEO Kondicii" (local PFS) to GKZ, with C1+C2 mineral reserves estimated of ~1.7 mmoz (51.7 tonnes) contained gold at a grade of 2.49 g/t  In 2013, IMC Montan prepared a JORC gold resource estimate of ~3.5 mmoz (~109 tonnes) contained gold at a grade of 1.82 g/t 7

Licenses Overview of Licenses Licenses Location  There are four licenses related to the Unkurtash gold project: – 1 Kassansky area Prospecting license – Unkurtash – Karatube Exploration license 2 – 3 Unkurtash Mining license Kassansky Area – 4 Karatube Mining license  The licenses are held by Highland Exploration Kyrgyzstan LLC  All of the license holder’s commitments regarding the schedule of prospecting, exploration and drilling as well as the submission of project documentation and the receipt of government approvals have been fulfilled in due course  The licenses will be extended, with the exception of the Kassansky area license, which may be transferred back to the government # Prospects Type Issued Valid Through May March 2709 АП 1 Kassansky area Prospecting 2013 2018 (1) January January 2 4564 AP Unkurtash - Karatube area Exploration 2021 (2) 2016 July December 3 3121 AE Unkurtash Mining 2012 2017 (3) July December 4 3122 AE (4) Karatube Mining 2017 (3) 2012 1. Upon expiry, file for license extension or transfer license back to the government. Informal commitment of increasing C1+C2 reserves by ~60 tonnes (1.9 mmoz) of contained gold by December 2018 following the submission of “TEO Kondicii ” (equivalent to Western PFS ). 2. 8 3. Two-year extension expected in 2017. Technical Project Report (equivalent to Western feasibility study) to be prepared until December 2019. The license is to be extended to include the Sarytube deposit following the submission of “TEO Kondicii ” in 2018. 4.