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Corporate Presentation TSX:HZM ZM / AIM:HZ HZM www. - - PowerPoint PPT Presentation

Corporate Presentation TSX:HZM ZM / AIM:HZ HZM www. horizonteminerals.com @horizontePLC Forward Looking Statements This presentation (the "Presentation") has been prepared by Horizonte Minerals plc (the "Company"). This


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TSX:HZM ZM / AIM:HZ HZM

  • www. horizonteminerals.com

@horizontePLC

Corporate Presentation

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TSX:HZM ZM / AIM:HZM ZM / horizonteminerals.com

Forward Looking Statements

This presentation (the "Presentation") has been prepared by Horizonte Minerals plc (the "Company"). This Presentation does not constitute or form part of, and should not be construed as: (i) an offer, solicitation or invitation to subscribe for, sell or issue, underwrite or otherwise acquire any securities or financial instruments, nor shall it, or the fact of its communication, form the basis of, or be relied upon in connection with, or act as any inducement to enter into any contract or commitment whatsoever with respect to such securities or financial instruments; or (ii) any form of financial opinion, recommendation or investment advice with respect to any securities or financial instruments. Certain statements and matters discussed in this Presentation may constitute forward-looking statements. Forward-looking statements are statements that are not historical facts and may be identified by words such as "aim", "anticipate", "believe", "continue", "estimate", "expect", "intend", "may", "should", "strategy", "will" and words of similar meaning, including all matters that are not historical facts. The forward-looking statements in this Presentation speak only as of the date hereof and are based upon various assumptions, many of which are based, in turn, upon further assumptions. Although the Company believes that these assumptions were reasonable when made, these assumptions are inherently subject to significant known and unknown risks, uncertainties, contingencies and other important factors which are difficult or impossible to predict and are beyond its control. These statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. Given these risks and uncertainties, prospective investors are cautioned not to place undue reliance on forward-looking statements. Other than in accordance with its legal or regulatory obligations, the Company is not under any obligation and the Company and its affiliates expressly disclaim any intention, obligation

  • r undertaking to update or revise any forward looking statements, whether as a result of new information, future events or otherwise. This Presentation shall not, under any

circumstances, create any implication that there has been no change in the business or affairs of the Company since the date of this Presentation or that the information contained herein is correct as at any time subsequent to its date. No statement in this Presentation is intended as a profit forecast or estimate. This Presentation includes geographic and economic information, industry data and market share information obtained from independent industry publications, market research and analyst reports, surveys and other publicly available sources. Although the Company believes these sources to be generally reliable, geographic and economic information, industry data and market share information is subject to interpretation and cannot be verified with complete certainty due to limits on the availability and reliability of raw data, the voluntary nature

  • f the data gathering process and other limitations and uncertainties inherent in any statistical survey. Accordingly, the accuracy and completeness of this data is not guaranteed. The

Company has not independently verified any of the data from third party sources referred to in this Presentation nor ascertained the underlying assumptions relied upon by such sources. Due to the uncertainty that may be attached to inferred mineral resource estimates, it cannot be assumed that all or any part of an inferred mineral resource estimate will be upgraded to an indicated or measured mineral resource estimate as a result of continued exploration. Confidence in an inferred mineral resource estimate is insufficient to allow meaningful application of the technical and economic parameters to enable an evaluation of economic viability sufficient for public disclosure, except in certain limited circumstances set out in National Instrument 43-101 – Standards of Disclosure for Mineral Projects. The economic analysis contained in the Company’s technical report is based on probable mineral reserve estimates. [Unless otherwise indicated, the scientific and technical information contained in this investor presentation has been prepared by or under the supervision of Anthony Finch, P.Eng., MAusIMM (CP Mining), B.Eng., B.Econ., Harald Muller, B. Eng., (Chem), MBL, FAusIMM, FIChemE, FSAIChE, C.Eng., Pr.Eng. and Andrew Ross, B.Sc. (Hons), M.Sc., MAIG, FAusIMM, P.Geo., each of Snowden Mining Industry Consultants Pty Ltd. (“Snowden”) and Peter Theron, Pr.Eng., SAIMM, B.Eng. (Civil Eng), G.D.E., of Prime Resources (Pty) Ltd Environmental

  • Consultants. All are Qualified Persons within the meaning of Canadian National Instrument 43-101 and have acted as consultants to the Company. For further details on the Araguaia

project, please refer to the technical report entitled “NI 43-101 Technical Report, Prefeasibility Study (PFS) for the Araguaia Nickel Project, Pará State, Brazil”, dated March 25, 2014, which is available on the Company’s website at www. horizonteminerals.com and on SEDAR at www.sedar.com. Mineral resources that are not reserves do not have demonstrated economic viability.]

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Developing Brazil’s Next Ferro-Nickel Mine

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Nickel for Life: Water Quality & Supply

World Bank estimates demand will exceed supply by 40% in 2030 Estimated that: ▪ 900 million people will not have access to clean drinking water ▪ 1.8 billion people will live in areas where water is scarce ▪ 1.6 billion will live in countries without sufficient water infrastructure ‘Nickel assists in virtually every step

  • f the delivery of drinking water

and making water potable’

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Source: Nickel Institute, Nickel in Tomorrow’s World: Tackling Global Challenges

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▪ The UN Food and Agriculture Organization estimates that 1/3 of the food produced is spoiled or discarded ▪ That’s over 1.3 billion tonnes of food lost each year due to inefficient farming/ storage/ transportation ▪ The global standard material for safe food production is nickel-containing stainless-steel

Nickel for Life: Food Security

Source: Nickel Institute, Nickel in Tomorrow’s World: Tackling Global Challenges

‘Nickel-containing stainless steels provide machinery and equipment that are robust, easily cleaned, and easily disinfected - essential for food security’

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Nickel for Life: Energy

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▪ World Energy Outlook: Demand for all sources of energy forecast to escalate significantly by 2035 ▪ Renewable fuel technologies require more metal ▪ A single wind turbine generally contains close to 500 kg of nickel ▪ Nickel is used in new energy solutions such as fuel cells, concentrating solar power, and cellulosing ethanol

Source: Nickel Institute, Nickel in Tomorrow’s World: Tackling Global Challenges

‘Nickel plays a vital role in the production of renewable energy, including solar, biomass & wind’

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Nickel for Life: Electric Vehicles

▪ Of the 89 million cars sold last year roughly one percent or

  • nly about 1.1 million were electric/hybrid vehicles

▪ Consultants expect EV and PHEV sales to rise to more than six million units by 2025, ~6% of global car sales ▪ Glencore says: “Batteries and the EV revolution could be a transformational event – it is debated that +60Kt of Ni demand in batteries today will multiply over next 5 yrs to ~150-300Kt & potentially more” ▪ c.11kg contained Ni in a 250kg EV battery

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“Our cells should be called Nickel-Graphite, because primarily the cathode is nickel and the anode side is graphite with silicon oxide… [there’s] a little bit of lithium in there, but it’s like the salt on the salad,” Elon Musk, Tesla, 2016

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Nickel Summary

▪ Nic ickel Prices – in Q1 2016 nickel hit a 13 year low of US$7,750 on LME. Prices increased to ~US$11,000 but today remain low at ~US$9,000. In 2007 nickel reached an intra day record of US$51,800 ▪ Co Cost Profile le – nickel industry C1 cost demonstrates 50%

  • f operations sub-economic today

▪ Strong Demand – highest rate of demand (particularly China) of any of the base metals in 2016 (grew 8% YoY) with supply waning driven by large closures of supply in 2015/16 due to low Ni prices & forced closure of mines in Philippines. EV Revolution to add a new driver. ▪ Nickel - is a late-cycle commodity with properties required in high-end applications where demand will continue to grow

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Others Foundry Alloy Steel Plating Non- ferrous alloys Nickel containing stainless steel Source: Nickel Institute

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Nickel Price

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Analyst Menno Sanderse “an ideal opportunity to benefit from the recovery when it takes place in the near future” Forecast at US$13,889 in 2018 “Nickel one of our most-preferred commodity exposures” For

  • recast at

t US$ S$14,330 in n 2018 “The optimistically resurgent Chinese stainless market has led to an increase in

  • ur world nickel demand forecasts...total ri

risin ing g to

  • 2.25Mt

Mt in n 2025” Nickel use in batteries could more than double over the next 10 years from around 70kt to close to 160-170kt

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Horizonte: Tier 1 Nickel Project

▪ The Araguaia nickel project is a Tier 1 asset in terms of size and grade, one of the largest undeveloped saprolite resources globally ▪ 2016 PFS demonstrated strong economics, viable at current nickel price - expected to generate US$1.3 billion in free cash flow over the LOM at US$12,000 / tonne Ni ▪ De-risked process route - ferronickel product ▪ Team to deliver ▪ Located in mining region with existing infrastructure and low cost hydro power ▪ Roadmap to commercial production and delivery on all milestones to date ▪ Strong institutional shareholder base including, Teck, Glencore, Lombard Odier, JP Morgan and Hargreave Hale ▪ Strengthening nickel market fundamentals - the medium term/long term outlook is positive

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FEASIBILITY STUDY

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Main FS Groups

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HZM HZM Proj

  • ject

Man Management & & Own Owners Tea eam

Wor

  • rle

ley Parsons Lead Engineering Group Prim ime Water & Waste Infrastructure, Geotech (plant) ERM ERM Permits, Sustainability & Hydrology Snow

  • wden

Mining, Geotech (mine) Stei teinweg Logistics Road Infrastructure Consultants Blos lossom Planning & Scheduling SM&A Power Line

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Feasibility Study Underway

▪ Fully funded FS targeted for completion by YE 2017 ▪ Key work streams to include:

▪ Infill drilling over trial mining site ▪ Trial mining to convert Probable Reserve to Proven Reserve, conform resource re- conciliation and overall mining conditions ▪ Geotechnical and hydrogeological programme for permitting purposes ▪ Crushing and screening test together with additional test work to enhance the process flow sheet ▪ Advancement

  • f
  • ff

take discussions – distribution of samples to potential partners

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Developing a best-in-class ferronickel operation to produce 14,500 tpa Ni with robust economics and a proven process route (RKEF)

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Trial Mining at Araguaia

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GEOLOGY & RESOURCES High grade, long-life, scalable

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Long Life Scalable Resource

▪ One of the largest and highest grade undeveloped nickel saprolite resources globally ▪ Long life operation with 28 year Life of Mine – potential to double LOM ▪ Longer term potential for step-change in production from…

▪ Second production line, which if implemented, would effectively double capacity ▪ Potential to increase reserves

16 16 Araguaia ia Category Materia ial type Tonnage (kT kT) Bulk ulk de densit ity y (t/m t/m3) Con

  • ntain

ined Ni Ni me metal l (kT kT) Ni Ni (%) Co

  • (%)

Fe Fe (%) MgO gO (%) SiO2

2

(%) Total Measured All 18,168 1.35 261 1.44 0.05 16.26 17.51 39.91 Total Indicated All 101,893 1.30 1,272 1.25 0.06 19.40 16.87 36.24 Tot

  • tal

Meas asured d + + Indic ndicated All 12 120,0 0,061 1. 1.30 30 1, 1,53 533 1. 1.28 28 0. 0.06 06 18 18.93 16 16.97 36 36.80 Total Inferred All 13,435 1.30 161 1.20 0.06 20.12 14.94 36.83

No Note: e: Totals may not add due to rounding. Mineral Resources are inclusive of Mineral Reserves. Mineral resource estimate at 0.9% nickel cut-off (Source: HZM 2016 Pre Feasibility Study)

Key Poin

  • ints
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Resource Growth: Trebled in 4 Years

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18.17 39.30 71.98 101.89 44.00 25.35 13.44 2010 2012 2014 2016

Ni 43-101 Compliant Mineral Resource (Mt)

Total Measured (Mt) Total Indicated (Mt) Total Inferred (Mt) 20 2012 12 Technic ical l Report 0.95% Cut-Off 20 2014 14 PF PFS 0.95% Cut-Off 20 2016 16 PF PFS 0.90% Cut-Off 20 2010 10 Exp Explo loratio ion Grassroots discovery

205% increase from 2012 to 2016 in Indicated and Measured Mineral Resource

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High Grade Potential

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45 45.7m .7m 72 72.5m .5m 10 108.5 8.5m

83.4m @ 2.06% Ni Including 62.8m @2.36% Ni Total depth: 148.4m Serra do Tapa Drill Hole: TC09-640-080

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Reserve Profile Comparison

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Ar Araguaia ia Mine Mineral l Rese serve Es Estima imate

Class Ore dr dry mas mass (kT) Con

  • ntain

ined Ni Ni me metal (kt) Ni Ni (%) Total Proven Total Probable 24,646 436 1.77 Total Proven & Probable 24,646 436 1.77 Bar arro Alt lto 20 2016 16 Mineral l Reserve Es Estim timate (Ex Extrapolated)

Class Ore re dr dry mas mass (kT) Con

  • ntained Ni

met metal (kt) Ni Ni (%) Total Proven 13,400 205 1.53 Total Probable 27,000 356 1.32 Total Proven & Probable 40,400 561 1.39

Source: Mineral reserve estimate (HZM 2016 PFS) Source: Anglo American Annual Report, Ore Reserves & Mineral Resources, 31 December 2016

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▪ Shallow open pit mining (max depth 25m)

▪ 7 pits in South, 1 pit in North ▪ 3 – 5 pits open at any given time ▪ Do not expect explosives required

▪ Total 30 year schedule

▪ 2 year pre-production ▪ 28 year LOM

▪ Ramp-up over 13 months ▪ Contract mining ▪ Targeted high grade nickel feed in early production years:

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Mine Plan & Operations

Yea ears Average Grade 1 to 5 2.0% Ni 6 to 10 1.9% Ni 11 to 28 1.7% Ni

Tonnes Mined (kt) Source: HZM 2016 Pre Feasibility Study

  • 2,000

4,000 6,000 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30

Pi Pits ts

PQZ PQW BAI JAC VOI VOE VOW VDS

Araguaia Mine Profile:

MINING ACTIVITIES HIGH GRADE ORE TO ENSURE RAPID PAYBACK

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ECONOMICS Robust today and geared for growth

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Robust PFS Economics

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Key Indi ndicators Valu alue Ni Nickel l pri price US$12,000/t US$14,000/t NP NPV8

8 po

post tax US$328M US$581M IRR RR po post t tax 19.3% 26.4% Init nitial min mine life 28 28 Cap Capit ital l cos

  • sts – pr

pre-prod

  • ductio

ion US$354M US$354M C1 C1 cos

  • sts

US$3.15/lb (US$6,944/t) US$3.15/lb (US$6,944/t) Fr Free cash fl flow w over LOM OM (a (aft fter capital pa payback) US$1.3B US$1.9B Payback per perio iod (a (aft fter taxation

  • n)

4.5 years 3.4 years Br Breakeven Ni Ni pri price on

  • n NP

NPV8

8

po post t tax US$9,426/t US$9,426/t Average ann annual pr prod

  • ductio

ion ~ 14,500tpa ~ 14,500tpa Average Ni Ni gr grad ade – Yea ear 1 to

  • 10

1.96% 1.96% Prod

  • duct grad

ade qu quality 30% Fe Ni 30% Fe Ni

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Tier 1 Project: Low Cost & High Grade

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Source: Wood Mackenzie Ltd, Dataset: Q1 2016

Araguaia ia C1 C1 cos

  • st of
  • f US$3.15/lb

lb (U (US$6,944/tonne)

2016 Nickel Industry, Normal C1 Cash Cost Grouped by Operation & ranked by Cash Cost (C1) Existing operations & Base Case

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Geared for Growth

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PROCESS Proven: Delivering a Ferro-Nickel Product

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Proven Process: RKEF

▪ RKEF is a proven nickel saprolite processing technology in operation for over 60 years ▪ Over 20 operational RKEF plants worldwide in

  • 2016. With the most recent built by the Chinese

in Indonesia in 2016 ▪ Successful pilot programme completed allowing process flow sheet design to be finalised

26 26

4 4 op

  • perations

s in in Brazil ut utilise the RKE RKEF pr process

  • ss. Image sho

shows s Ang Anglo American’s Barro Alto mine HZM ZM FeN eNi 30 30 pr produced at the Morr

  • rro Az

Azul RKE RKEF facil acility in in Brazil – June 20 2015 15

ROTARY KILN DRYER LADLE FURNACE ELECTRIC RECEPTION SHED ORE HOMOGENISATION SLAG DUMP FeNi SHOTS FeNi SHOTS CRUSHER CRUSHER DUST BIN CRUSHER SLAG

WAT ER

FURNACE DRYER STORAGE GRANULATION FeNi GRANULATION ROTARY SCREEN ELECTROSTATIC PRECIPITATOR WATER SPRAY COOLING COOLING TANK WATER DAM SLAG SETTLING TANK DEWATERING BEEN

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Plant Site Location: Drone View

TSX:HZM ZM / AIM:HZM ZM / horizonteminerals.com

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Ferro-Nickel Product

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PRODUCT ARAGUAIA FERRONICKEL

Ele Element Content (% (% Max) Nickel (Ni) 28-32 Cobalt (Co) 0.80 Copper (Cu) 0.06 Silicon (Si) 0.04 Phosphorus (P) 0.03 Sulphur (S) 0.04 Carbon (C ) 0.04 Iron (Fe) Balance

▪ FeNi granules: 2-50mm ▪ Final product to be supplied in bulk or big bags High High gr grad ade FeN eNi30 pr prod

  • duct to
  • com
  • mmercial

spe pecif ific icatio ion wi with low w imp mpurit itie ies PHYSICAL CHARACTERISTICS & PACKAGING Fer erronic ickel l gr gran anule les pr prod

  • duced fr

from

  • m

Ar Arag aguaia ia or

  • re

e 2015

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BRAZIL & PARA STATE Good infrastructure and established mining code

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Power and Infrastructure

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ENVIRONMENTAL & SOCIAL Araguaia: a regional economic driver

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Environmental & Social

▪ Environmental Preliminary Licence (LP) for mine and plant awarded for Araguaia project in May 2016 ▪ Fully compliant Social and Environmental Impact Assessment completed and approved ▪ Araguaia project viewed as regional economic driver by State Government ▪ Limited population density across area of influence ▪ Consultations undertaken with 3,000+ community members to date – positive support for project ▪ Positive water balance in the region ▪ Over 80% of water planned to come from recycled sources ▪ Mine closure plans & provisions in place ▪ Slag tested and classified as inert, no tailings dams ▪ Multiple years of baseline data recorded

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INVESTMENT CASE

Leveraged exposure to a tier 1 nickel project

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Investment Case

▪ A Tier 1 asset in terms of size and grade - one of the largest undeveloped saprolite resources globally ▪ An advanced project - fully funded Feasibility Study underway for delivery by YE 2017 and good progress towards Installation Licence submission to allow mine construction ▪ Building on 2016 PFS’ strong economics, viable at current nickel price - expected to generate US$1.3 billion in free cash flow over the LOM at US$12,000 / tonne Ni ▪ De-risked process route and a defined roadmap to commercial production ▪ Well connected – located in mining region with existing infrastructure and low cost hydro power ▪ Strong institutional shareholder base including, Teck, Glencore, Lombard Odier, JP Morgan and Hargreave Hale ▪ Strengthening nickel market fundamentals - the medium term/long term outlook is positive with multiple value drivers going forwards

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Key Data

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(SP data from 30.05.17)

Tic icker AIM: HZM TSX: HZM Sha Share pr price 2.525p C$0.05 Mar arket Cap ap £31M C$46.9M Cas ash + + Equ quivalents £7.8M (C~$13.2M) 52 52 week trading AIM: 3.55p – 1.82p (C$0.06 – C$0.02) Nom

  • mad & Broker

finnCap Ana Analyst coverage finnCap Paradigm Capital

Significant Shareholders Strong institutional backing endorses Horizonte’s asset and team

Teck Resources 17.9% Lombard Odier 4.1% Richard Griffiths 13.8% JP Morgan 8.98% Hargreave Hale 6.84% Glencore 6.4% City Financial 5.6% Other 33.21%

Key Shareholders

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Ho Horizonte e Min inerals PLC

CEO Jeremy Martin

E: j.martin@horizonteminerals.com T: +44 (0) 20 7763 7157 www.horizonteminerals.com Twitter: @horizonteplc

St t Br Brid ides Part rtners Ltd

Lottie Brocklehurst Megan Dennison

T: +44 (0) 20 7236 1177 www.stbridespartners.co.uk

CONTACT

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A Team to Deliver

37 Dav avid id J. Hal all Chairman 30 years in exploration & development on projects and mines in over 50 countries. Extensive South America and Brazil

  • experience. Experience includes Minorco, Anglo American and AngloGold.

Jere remy J. Mar artin in CEO and Director Extensive exploration, development and executive management experience in South America and Europe. Involved in the formation of a number of AIM and TSX listed resources companies. Owe Owen Bav avin inton Non Executive Director Previously Group Head of Exploration and Geology at Anglo American. Alexander N Chri hrist stopher Non Executive Director Over 30 years of experience in mineral exploration and mining. Senior Vice President of Exploration for Teck and project development. Will lliam Fish sher Non Executive Director Extensive industry experience in both major and junior exploration and mining positions worldwide. Currently on the Boards

  • f PC Gold, Goldquest and Treasury Metals.

Alla lan M M Wal alker Non Executive Director Over 30 years of experience in energy and natural resources project finance. Experience includes running Credit Suisse's project finance team in Brazil and being on the board of the country’s largest wind farm. Mr Walker is fluent in Portuguese.

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TSX:HZM ZM / AIM:HZ HZM

  • www. horizonteminerals.com

@horizontePLC

Corporate Presentation