Shandong Gold Mining : CIRCULAR FOR 2020 SECOND EXTRAORDINARY GENERAL MEETING AND 2020 THIRD H SHARES CLASS MEETING

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this circular or as to the action to be taken, you should consult your stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in Shandong Gold Mining Co., Ltd., you should at once hand this circular to the purchaser(s) or transferee(s) or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser(s) or transferee(s).

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular.

SHANDONG GOLD MINING CO., LTD.

山東黃金礦業股份有限公司

(a joint stock company incorporated in the People's Republic of China with limited liability)

(Stock Code: 1787)

1. RESOLUTION ON AGREEING NON-FERROUS GROUP, WANG ZHIQIANG AND JINMAO MINING TO EXTEND THE TERM OF

COMMITMENT IN RELATION TO REMEDYING DEFECTS OF THE LAND

AND PROPERTY OWNERSHIP OF PENGLAI MINING

1. RESOLUTION ON SHARE COMPENSATION PLAN FOR NOT REALIZING PERFORMANCE COMMITMENT OF THE SUBJECT ASSETS UNDER

THE MATERIAL ASSET RESTRUCTURING OF THE COMPANY

1. RESOLUTION RELATING TO SUBMISSION TO THE GENERAL MEETING FOR AUTHORISING THE BOARD WITH FULL DISCRETION

TO FACILITATE THE BUY-BACK OR GRANT OF COMPENSATION SHARES

1. NOTICE OF 2020 SECOND EXTRAORDINARY GENERAL MEETING AND NOTICE OF 2020 THIRD CLASS MEETING FOR HOLDERS OF H SHARES

A notice convening the 2020 second extraordinary general meeting (the "EGM") and a notice convening the 2020 third class meeting for holders of H Shares (the "H Shares Class Meeting") of Shandong Gold Mining Co., Ltd. (the "Company") to be held at the conference room of the Company, Building No. 3, Shuntai Plaza, Shunhua Road No. 2000, Jinan, Shandong Province, the PRC at 9:00 a.m. on Tuesday, 25 August 2020 and on Tuesday, 25 August 2020 immediately after the conclusion of the 2020 third class meeting for holders of A Shares of the Company are set out on pages III-1 to III-2 and IV-1 to IV-2 respectively of this circular.

The proxy forms for use in connection with the EGM and the H Shares Class Meeting are enclosed herewith. The proxy forms are also published on the website of The Stock Exchange of Hong Kong Limited (www.hkexnews.hk) and the Company's website (http://www.sdhjgf.com.cn).

Any shareholder(s) of the Company (the "Shareholders") entitled to attend and vote at the EGM and the H Shares Class Meeting are entitled to appoint one or more proxies to attend and vote on his behalf. A proxy need not be a shareholder of the Company. If you intend to appoint a proxy to attend the EGM and the H Shares Class Meeting and vote on your behalf, you are requested to complete the accompanying proxy forms in accordance with the instructions printed thereon and return them by hand, by post or by facsimile to the Company's H share registrar, Tricor Investor Services Limited at Level 54, Hopewell Centre, 183 Queen's Road East, Hong Kong (for H Shareholders only) as soon as possible and in any event not later than 24 hours before the time appointed for the holding of the EGM and the H Shares Class Meeting or any adjournment thereof (as the case may be) (i.e. before 9:00 a.m. on Monday, 24 August 2020). Completion and return of the proxy forms will not preclude you from attending and voting at the EGM and the H Shares Class Meeting or any adjournment hereof should you so wish.

31 July 2020

		CONTENTS
			Page
Definitions . . . . .	. . . .	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	ii
Letter from the Board	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Appendix I	-	Overseas Regulatory Announcement of the Company on
		Non-ferrous Group, Wang Zhiqiang and Jinmao Mining
		to Extend the Term of Commitment in Relation to
		Remedying Defects of the Land and Property Ownership of
		Penglai Mining . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	I-1
Appendix II	-	Overseas Regulatory Announcement of the Company on
		Share Compensation for not Realizing Performance
		Commitment Against the Subject Assets under the Company's
		Material Asset Restructuring . . . . . . . . . . . . . . . . . . . . . . . . . . .	II-1
Appendix III	-	Notice of 2020 Second Extraordinary General Meeting . . . . . . . . .	III-1
Appendix IV	-	Notice of 2020 Third H Shares Class Meeting . . . . . . . . . . . . . . . . .	IV-1

- i -

DEFINITIONS

In this circular, unless the context otherwise requires, the following expressions shall have the following meanings:

"A Shareholder(s)"	holder(s) of A Shares;
"A Share(s)"	the domestic share(s) issued by the Company to domestic
	investors with a nominal value of RMB1.00 each, which
	are listed on the Shanghai Stock Exchange;
"A Shares Class Meeting"	the 2020 third A Shares class meeting of the Company to be
	held on Tuesday, 25 August 2020;
"Articles of Association"	the articles of association of the Company, as amended
	from time to time;
"Board"	the board of Directors of the Company;
"Company"	Shandong Gold Mining Co., Ltd. (山東黃金礦業股份有限
	公司), a joint stock company incorporated in the PRC
	under the laws of the People's Republic of China with
	limited liability on 31 January 2000, the H shares and A
	shares of which are listed on the main board of the Hong
	Kong Stock Exchange (Stock Code: 1787) and the
	Shanghai Stock Exchange (Stock Code: 600547)
	respectively;
"Codes"	the Codes on Takeovers and Mergers and Share Buy-backs;
"Directors"	the directors of the Company;
"EGM"	the 2020 second extraordinary general meeting of the
	Company to be held at 9:00 a.m. on Tuesday, 25 August
	2020 at the conference room of the Company, Building
	No. 3, Shuntai Plaza, Shunhua Road No. 2000, Jinan,
	Shandong Province, the PRC;
"Executive"	the Executive Director of the Corporate Finance Division
	of the SFC or any delegate of the Executive Director;
"Hong Kong 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 Stock Exchange"	The Stock Exchange of Hong Kong Limited;
"H Shareholder(s)"	holder(s) of H Shares;

- ii -

	DEFINITIONS
"H Shares"	the overseas-listed foreign invested share(s) in the
	Company's share capital, with a nominal value of
	RMB1.00 each, which are listed on the Hong Kong Stock
	Exchange;
"H Shares Class Meeting"	the 2020 third H Shares class meeting of the Company to be
	held on Tuesday, 25 August 2020;
"Independent Shareholders"	Shareholders who are independent of and have no interest
	in the transactions contemplated under the Extension and
	the Proposed Buy-back or the Granting of Compensation
	Shares (as the case maybe)
"Jinmao Mining"	Yantai Jinmao Mining Co., Ltd. (煙臺市金茂礦業有限公
	司), a limited liability company incorporated in the PRC;
"Latest Practicable Date"	27 July 2020, being the latest practicable date prior to the
	printing of this circular;
"Non-ferrous Group"	Shandong Gold Non-ferrous Metal Mine Group Co., Ltd.
	(山東黃金有色礦業集團有限公司), a limited liability
	company incorporated in the PRC on 19 August 2008 and
	was held as to approximately 95.65% by SDG Group Co.
	and approximately 4.35% by Jinan Jinsui Jincai Investment
	Partnership (Limited Partnership) (濟南金穗金財投資合夥
	企業（有限合夥）);
"Penglai Mining"	Shandong Gold Group Penglai Mining Co., Ltd. (山東黃金
	集團蓬萊礦業有限公司), a limited liability company
	incorporated in the PRC on 1 August 2003 and a
	wholly-owned subsidiary of the Company;
"PRC"	the People's Republic of China;
"Prospectus"	the prospectus being issued by the Company in connection
	with the Hong Kong public offering dated 14 September
	2018;
"RMB"	Renminbi, the lawful currency of the PRC;
"SDG Exploration"	Shandong Gold Geological Mine Exploration Co., Ltd. (山
	東黃金地質礦產勘查有限公司), a limited liability
	company incorporated in the PRC on 3 January 2003 and a
	wholly-owned subsidiary of SDG Group Co.;
"SDG Group"	SDG Group Co. and all of its subsidiaries;

- iii -

	DEFINITIONS
"SDG Group Co."	Shandong Gold Group Co., Ltd. (山東黃金集團有限公司),
	a limited liability company incorporated in the PRC on 16
	July 1996, the controlling shareholder of the Company, and
	was held as to approximately 70% by Shandong SASAC
	(山東國有資產監督管理委員會), as to approximately 20%
	by Shandong Guohui Investment Co., Ltd. (山東國惠投資
	有限公司) and as to approximately 10% by Shandong
	Social Security Fund Committee (山東省社會保障基金理
	事會);
"Shanghai Listing Rules"	the Rules Governing the Listing of Stocks on the Shanghai
	Stock Exchange (上海證券交易所股票上市規則) as
	amended, supplemented or otherwise modified from time
	to time;
"Shanghai Stock Exchange" or "SSE"	Shanghai Stock Exchange (上海證券交易所);
"Shareholders"	the shareholders of the Company; and
"%"	per cent.

- iv -

LETTER FROM THE BOARD

SHANDONG GOLD MINING CO., LTD.

山東黃金礦業股份有限公司

(a joint stock company incorporated in the People's Republic of China with limited liability)

	(Stock Code: 1787)
Executive Directors:	Registered office and headquarters
	in the PRC:
Mr. Wang Peiyue
Mr. Li Tao (Vice-Chairman)	Building No. 3, Shuntai Plaza
Mr. Tang Qi	Shunhua Road No. 2000
	Jinan, Shandong Province
Non-executive Directors:	PRC

Mr. Li Guohong (Chairman)	Principal place of business in Hong Kong:
Mr. Wang Lijun
Ms. Wang Xiaoling	Rooms 4003-4006
	China Resources Building
Independent Non-executive Directors:	No. 26 Harbour Road
	Wanchai
Mr. Gao Yongtao	Hong Kong
Mr. Lu Bin
Ms. Hui Wing
To the Shareholders
Dear Sir or Madam,

1. RESOLUTION ON AGREEING NON-FERROUS GROUP, WANG ZHIQIANG AND JINMAO MINING TO EXTEND THE TERM OF

COMMITMENT IN RELATION TO REMEDYING DEFECTS OF THE LAND

AND PROPERTY OWNERSHIP OF PENGLAI MINING

1. RESOLUTION ON SHARE COMPENSATION PLAN FOR NOT REALIZING PERFORMANCE COMMITMENT OF THE SUBJECT ASSETS UNDER
   THE MATERIAL ASSET RESTRUCTURING OF THE COMPANY
2. 1. RESOLUTION RELATING TO SUBMISSION TO THE GENERAL

MEETING FOR AUTHORISING THE BOARD WITH FULL DISCRETION TO FACILITATE THE BUY-BACK OR GRANT OF COMPENSATION SHARES

1. NOTICE OF 2020 SECOND EXTRAORDINARY GENERAL MEETING AND NOTICE OF 2020 THIRD CLASS MEETING FOR HOLDERS OF H SHARES

- 1 -

LETTER FROM THE BOARD

INTRODUCTION

On behalf of the Board, I invite you to attend the EGM and the H Shares Class Meeting to be held at the conference room of the Company, Building No. 3, Shuntai Plaza, Shunhua Road No. 2000, Jinan, Shandong Province, PRC at 9:00 a.m. on Tuesday, 25 August 2020 and on Tuesday, 25 August 2020 immediately after the conclusion of the A Shares Class Meeting respectively. The purpose of this circular is to issue the notices of EGM and the H Shares Class Meeting and provide you with all reasonably necessary information to enable you to make an informed decision as to the resolution to be proposed at the EGM and at the H Shares Class Meeting.

BACKGROUND

Prior to the listing of the Company's H shares on the Hong Kong Stock Exchange, the Company completed an issue of shares to acquire assets and raise funds, which constituted a connected transaction under the Shanghai Listing Rules (the "Previous Restructuring") in October 2016. The Company issued shares to SDG Group Co., Non-ferrous Group, SDG Exploration, Jinmao Mining and Mr. Wang Zhiqiang to acquire the exploration and mining permits of Dongfeng mine area and relevant assets and liabilities, 70.65% equity interest in Guilaizhuang Gold Mine, 100% equity interest in Penglai Mining and exploration permit of Xinli mine area (collectively the "Subject Assets").

On 23 July 2020, the Company convened the 37th meeting of the fifth session of the Board, which considered and passed, among other things, the following resolutions in relation to the Previous Restructuring:

1. 1. approving the corresponding share compensation for not realising performance commitment against the Subject Assets under the material asset restructuring of the Company; and
   2. approving the extension of the term of commitment in relation to remedying defects of the land and property ownership of Penglai Mining by the original shareholders of Penglai Mining.
2. EXTENSION OF TERM OF COMMITMENT ON REMEDYING DEFECTS OF LAND AND PROPERTY OWNERSHIP OF PENGLAI MINING

On 27 November 2014, Non-ferrous Group, Mr. Wang Zhiqiang and Jinmao Mining, as the counterparties of the Company's Previous Restructuring, issued the Commitment Letter on the Completeness of Rights in respect of Subject Assets of the Material Asset Restructuring (the "Commitment Letter") and undertook that Penglai Mining would complete procedures for the State-owned Land Use Right Certificate in respect of the collective lands currently leased for its principal production and operation and relevant formalities for the Property Ownership Certificate in respect of operating-purpose buildings built on the lands pertaining to the State-owned Land Use Right Certificate by 30 June 2016.

As the said commitment could not be fulfilled on or before the aforesaid expiry date, the term of the commitment was extended twice by the consideration and approval of board meetings and general meetings of the Company in 2016 and 2017, which extended the performance period of the commitment to 30 June 2020.

- 2 -

LETTER FROM THE BOARD

As the lands and properties currently occupied by Penglai Mining for production and operation is affected by several factors such as the re-evaluation of the coverage of environmental protection zones and the state-owned land expropriation indicators, the procedures for applying relevant certificates were not completed by 30 June 2020. On 28 June 2020, Non-ferrous Group, Jinmao Mining and Mr. Wang Zhiqiang issued the Supplementary Commitment Letter in respect of the extension of performing the commitment: they will assist Penglai Mining to complete procedures for the State-owned Land Use Right Certificate for the lands other than the tailings depot that have not obtained certificates and formalities for the Property Ownership Certificate for the operating-purpose buildings thereon by 30 June 2023.

If Penglai Mining fails to complete procedures for the ownership certificates in respect of lands and properties stated above by 30 June 2023 (the "Extension"), upon the demand of the Company, Non-ferrous Group, Jinmao Mining and Mr. Wang Zhiqiang will, based on their respective shareholdings in Penglai Mining, buy back all equity interests of Penglai Mining at the price not lower than the net asset valuation level of Penglai Mining determined in the Previous Restructuring and assume the responsibility to compensate or indemnify the Company against all actual losses arising therefrom.

For details of the Extension, please refer to Appendix I to this circular.

The Board is of the view that the Extension is not a material amendment to the Commitment Letter. The Extension is not subject to reporting, announcement and Shareholders' approval requirements under the Hong Kong Listing Rules. According to the Shanghai Listing Rules and the Articles of Association, the Extension has to be submitted to the EGM for Independent Shareholders' consideration and approval.

The aforesaid resolution was considered and approved by the Board on 23 July 2020 and will be submitted, by way of ordinary resolution, for the Shareholders' consideration and approval at the EGM.

1. SHARE COMPENSATION FOR NOT REALISING PERFORMANCE COMMITMENT AGAINST THE SUBJECT ASSETS UNDER THE COMPANY'S MATERIAL ASSET RESTRUCTURING

Pursuant to the Prospectus, in May 2015, the Company entered into an agreement with Non-ferrous Group pursuant to which the Company agreed to issue some A Shares to Non-ferrous Group for the acquisition of the 70.65% equity interest in Guilaizhuang Gold Mine (歸來莊金礦) and 51% equity interest in Penglai Mining (蓬萊金礦) held by Non-ferrous Group (the "Asset Acquisition Agreement").

It is also further stated in the Prospectus that a profit forecast compensation agreement was entered into between the Company and Non-ferrous Group which was subsequently supplemented in 2015 (together, the "Compensation Agreement"). Pursuant to the terms of the Compensation Agreement, Non-ferrous Group shall compensate the Company with corresponding amounts of A Shares held by it should the committed profit for the year was not achieved. As Non-ferrous Group was affected by certain industrial safety accidents of third parties in the region and failed to achieve the net profit for the year committed in its undertakings in 2016, it was required to compensate 13,015,060 A Shares to the Company, and the above compensation shall proceed after the end of performance commitment period in 2019. The said shares were being held by Non-ferrous Group without voting power and no dividends were ever paid with respect to the said shares held by Non-ferrous Group. As at the Latest Practicable Date, Non-ferrous Group is obliged to compensate a total of 18,221,084 A Shares ("Compensation Shares") as a result of the bonus issue under the 2018 profit distribution plan of the Company and is subject to further adjustment pursuant to the bonus issue implemented under the 2019 profit distribution plan of the Company.

- 3 -

LETTER FROM THE BOARD

A special resolution on share compensation plan for not realizing performance commitment of the subject assets under the material asset restructuring of the Company will be submitted to the Shareholders at the EGM, class meeting for holders of A Shares and class meeting for holders of H Shares of the Company for consideration. If Shareholders have considered and approved the resolution, the Company will buy back the Compensation Shares at the total price of RMB1.00 and cancel such shares (the "Proposed Share Buy-back"). If Shareholders do not approve the Proposed Share Buy-back, the Company should within 10 business days after the publication of the poll results announcement of the general meeting of the Company, notify Non-ferrous Group and that Non-ferrous Group should within 30 days after receiving the notice from the Company, give at nil consideration, the Compensation Shares to other Shareholders (other than Non-ferrous Group) whose names appear on the register of members at the record date which shall be announced before the end of the said 30 days mentioned above and other Shareholders shall receive the shares in accordance with the proportions of shares held by them to the total share capital of the Company at the record date (after deducting the number of shares held by Non-ferrous Group) (the "Granting of Compensation Shares").

For details of the Proposed Share Buy-back or the Granting of Compensation Shares (as the case maybe) under the resolution on share compensation plan for not realizing performance commitment of the subject assets under the material asset restructuring of the Company, please refer to Appendix II to this circular.

The Company has sought the Executive's confirmation that the Proposed Share Buy-back by the Company falls within the definition of exempt share buy-back under the Codes and the Executive has confirmed in writing that the Proposed Share Buy-back falls within the definition of exempt share buy-back under the Codes.

The Proposed Share Buy-back or the Granting of Compensation Shares (as the case maybe) is not subject to reporting, announcement and Shareholders' approval requirements under the Hong Kong Listing Rules. According to the Shanghai Listing Rules and the Articles of Association, the Proposed Share Buy-back or the Granting of Compensation Shares (as the case maybe) has to be submitted for Independent Shareholders' consideration and approval.

The aforesaid resolution was considered and approved by the Board on 23 July 2020 and will be submitted, by way of special resolution, for the Shareholders' consideration and approval at the EGM, A Shares Class Meeting and H Shares Class Meeting.

1. RESOLUTION ON PROPOSING AT THE GENERAL MEETING TO AUTHORISE THE BOARD, TO DEAL WITH MATTERS RELATED TO PROPOSED BUY-BACK OR GRANTING OF COMPENSATION SHARES AT ITS FULL DISCRETION

To ensure that matters related to the Proposed Share Buy-back or the Granting of Compensation Shares (as the case maybe) for not realising the performance commitment under the Company's Previous Restructuring can be completed smoothly, it is proposed at the EGM to authorise the Board to deal with matters related to Proposed Share Buy-back or Granting of Compensation Shares corresponding to committed performance compensation measures at its full discretion, details of which are as follows:

1. If the Shareholders at the EGM have approved matters of Proposed Buy-back

The Board shall be authorised to deal with matters related to share repurchase and cancellation at its full discretion, including but not limited to:

1. establishing securities accounts designated for repurchase;

- 4 -

LETTER FROM THE BOARD

1. paying the consideration;
2. signing and amending relevant transaction documents, agreements and supplementary documents (if any);
3. dealing with matters related to cancelling shares at CSDC Shanghai Branch and Shanghai Stock Exchange;
4. dealing with matters related to the registration of share capital changes and the information disclosure;
5. dealing with lawsuits related to the share repurchase in respect of the performance commitment compensation;
6. dealing with other matters related to the performance commitment compensation.

2. If the Shareholders at the EGM have not approved matters of Proposed Buy-back

The Board shall be authorised to deal with matters related to share granting at its full

discretion, including but not limited to:

1. reviewing and determining the list of grantees under the granting without consideration, and determining and adjusting the equity record date under the share granting plan and the specific share granting method and operation plan based on actual conditions;
2. signing and amending relevant transaction documents, agreements and supplementary documents (if any);
3. engaging relevant intermediaries (if applicable);
4. handling the transfer of shares and other external review works in respect of the share granting without consideration;
5. dealing with information disclosure matters involving the share granting;
6. making corresponding adjustments to compensation shares and other matters in response to events including ex-right of the Company's shares; with the aim of protecting the interests of beneficiaries and the purpose of facilitating beneficiaries to receive the compensation, adjusting the relevant compensation plan and subsequent implementation matters based on actual conditions;
7. dealing with lawsuits related to the share granting in respect of the performance compensation;
8. dealing with other matters related to the share granting in respect of performance compensation.

- 5 -

LETTER FROM THE BOARD

The authorisation becomes valid upon the consideration and approval at the EGM and expires at the date when matters related to the share compensation for not realising the performance commitment under the Company's material asset restructuring are consummated.

The aforesaid resolution was considered and approved by the Board on 23 July 2020 and will be submitted, by way of ordinary resolution, for the Shareholders' consideration and approval at the EGM.

EGM AND THE H SHARES CLASS MEETING

The EGM and the H Shares Class Meeting are to be held at the conference room of the Company, Building No. 3, Shuntai Plaza, Shunhua Road No. 2000, Jinan, Shandong Province, the PRC at 9:00 a.m. on Tuesday, 25 August 2020 and on Tuesday, 25 August 2020 immediately after the conclusion of the A Shares Class Meeting respectively. The notices of the EGM and the H Shares Class Meeting are set out in Appendix III and IV to this circular respectively.

Any Shareholder entitled to attend and vote at the EGM and the H Shares Class Meeting are entitled to appoint one or more proxies to attend and vote on his behalf. A proxy need not be a Shareholder. If you intend to appoint a proxy to attend the EGM and the H Shares Class Meeting and vote on your behalf, you are requested to complete the accompanying proxy forms in accordance with the instructions printed thereon and return them, by hand, by post or by facsimile, to the Company's H share registrar, Tricor Investor Services Limited, at Level 54, Hopewell Centre, 183 Queen's Road East, Hong Kong (for H Shareholders only) as soon as possible and in any event not later than 24 hours before the time appointed for the holding of the EGM and the H Shares Class Meeting or any adjournment thereof (as the case may be) (i.e. before 9:00 a.m on Monday, 24 August 2020). Completion and return of the proxy forms will not preclude you from attending and voting at the EGM and the H Shares Class Meeting or any adjournment thereof should you so wish.

CLOSURE OF REGISTER OF MEMBERS

For the purpose of ascertaining the Shareholders who are entitled to attend and vote at the EGM and the H Shares Class Meeting, the register of members of the Company will be closed from Thursday, 20 August 2020 to Tuesday, 25 August 2020, both dates inclusive, during which period no transfers of Shares will be effected.

In order to qualify to attend and vote at the EGM and the H Shares Class Meeting, all transfer instruments accompanied by the relevant share certificates must be lodged by H Shareholders with the Company's H Share Registrar, namely, Tricor Investor Services Limited at Level 54, Hopewell Centre, 183 Queen's Road East, Hong Kong no later than 4:30 p.m. on Wednesday, 19 August 2020.

VOTING

Pursuant to Rule 13.39(4) of the Listing Rules and Article 119 of the Articles of Association, unless the chairman makes a decision in the spirit of honesty and credibility and agrees that the resolutions on relevant procedures or administrative matters shall be voted on by show of hands, voting for a general meeting shall be held by ballot.

- 6 -

LETTER FROM THE BOARD

Pursuant to Article 111 of the Articles of Association, Shareholders (including proxies) shall exercise their voting rights according to the number of voting shares they represent, with one vote for each share. Pursuant to Article 120 of the Articles of Association, on a poll taken at a meeting, a shareholder (including proxy) entitled to two or more votes need not cast all his votes in the same way.

As at the Latest Practicable Date, SDG Group Co., Shandong Gold Non-ferrous Metal Mine Group Co., Ltd., Shandong Gold Geological Mine Exploration Co., Ltd., Shandong Gold Group Qingdao Gold Co., Ltd., and SDG (Beijing) Industry Investment Co., Ltd. holding a total of 1,458,780,320 Shares shall abstain from voting on resolutions numbered 1 and 2 at the EGM and/or Class Meetings. Save as to the aforesaid, no other Shareholders are required to abstain from voting at the EGM and/or Class Meetings.

RECOMMENDATION

The Directors are of the view that the proposed resolutions at the EGM and the H Shares Class Meeting are fair and reasonable and in the best interests of the Company and its Shareholders as a whole. Accordingly, the Directors recommend the Shareholders to vote in favour of the relevant resolutions to be proposed at the EGM and the H Shares Class Meeting.

RESPONSIBILITY STATEMENT

This circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Hong Kong Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this circular 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 circular misleading.

GENERAL INFORMATION

Your attention is drawn to the information set out in the appendices to this circular.

By order of the Board

Shandong Gold Mining Co., Ltd.

Li Guohong

Chairman

Jinan, the PRC, 31 July 2020

- 7 -

APPENDIX I	OVERSEAS REGULATORY ANNOUNCEMENT OF THE COMPANY ON
	NON-FERROUS GROUP, WANG ZHIQIANG AND JINMAO MINING
	TO EXTEND THE TERM OF COMMITMENT IN RELATION TO REMEDYING
DEFECTS OF THE LAND AND PROPERTY OWNERSHIP OF PENGLAI MINING
Stock Code: 600547	Stock Abbreviation: SD GOLD	Announcement No.: Lin 2020-050
	SHANDONG GOLD MINING CO., LTD.

ANNOUNCEMENT ON NON-FERROUS GROUP, WANG ZHIQIANG AND JINMAO MINING TO EXTEND THE TERM OF COMMITMENT IN RELATION TO REMEDYING DEFECTS OF THE LAND AND PROPERTY OWNERSHIP OF PENGLAI MINING

The Company and all members of its board of directors guarantee the truthfulness, accuracy and completeness of the contents of this announcement, and severally and jointly accept the responsibility in case there are false representations and misleading statements contained in, or material omissions from, this announcement.

Important Notes:

• Non-ferrousGroup, the natural person Wang Zhiqiang and Jinmao Mining, being original shareholders of Penglai Mining (one of the subject assets of the Company's previous restructuring), who acted as the counterparties of the Company's previous restructuring, issued the Commitment Letter on the Completeness of Rights in Respect of Subject Assets of the Material Asset Restructuring and undertook that Penglai Mining would complete procedures for the State-owned Land Use Right Certificate in respect of the lands for its principal production and operation and relevant formalities for the Property Ownership Certificate in respect of operating-purpose buildings built on the lands pertained to the State-owned Land Use Right Certificate. As the said commitment could not be fulfilled on or before the expiry date, the term of the commitment was extended twice by the consideration and approval of board meetings and general meetings of the Company in 2016 and 2017, which extended the performance period of the commitment to 30 June 2020.
• Penglai Mining could not complete the procedures for applying relevant certificates by 30 June 2020 as the lands and properties Penglai Mining currently occupies for its production and operation were subject to the adjustment of ecological protection redline, the state-owned land acquisition quota and other factors, and Non-ferrous Group, Wang Zhiqiang and Jinmao Mining asked for an extension of the performance period of the aforesaid commitment in relation to remedying defects of the land and property ownership other than the tailings depot of Penglai Mining to 30 June 2023.
• Penglai Mining will not apply for the State-owned Land Use Right Certificate for the land in respect of Hexi Tailings Depot and use the land by way of land leasing within the scope permitted by national policies.
• This matter shall be submitted to the general meeting of the Company for consideration.

- I-1 -

APPENDIX I	OVERSEAS REGULATORY ANNOUNCEMENT OF THE COMPANY ON
	NON-FERROUS GROUP, WANG ZHIQIANG AND JINMAO MINING
	TO EXTEND THE TERM OF COMMITMENT IN RELATION TO REMEDYING
	DEFECTS OF THE LAND AND PROPERTY OWNERSHIP OF PENGLAI MINING

1. • Shandong Gold Mining Co., Ltd. (the "Company" or "Shandong Gold") convened the 37th meeting of the fifth session of the board of directors (the "Board") on 23 July 2020, which considered and passed the Resolution on Approving Non-ferrous Group, Wang Zhiqiang and Jinmao Mining to Extend the Term of Commitment in Relation to Remedying Defects of the Land and Property Ownership of Penglai Mining, and proposed to agree that Shandong Gold Non-ferrous Metal Mine Group Co., Ltd. (originally holding 51% of equity interest, "Non-ferrous Group"), the natural person Wang Zhiqiang (originally holding 29% of equity interest) and Yantai Jinmao Mining Co., Ltd. (originally holding 20% of equity interest, "Jinmao Mining"), all being original shareholders of Shandong Gold Group Penglai Mining Co., Ltd. ("Penglai Mining"), one of the subject assets of the Company's previous material asset restructuring (the "Previous Restructuring"), would extend the term of commitment in relation to remedying defects of the land and property ownership of Penglai Mining. Relevant matters are disclosed hereunder.
2. Background of the Commitment
   In accordance with Measures for the Administration of the Restructurings of Listed Companies,

Non-ferrous Group, the natural person Wang Zhiqiang and Jinmao Mining, being original shareholders of Penglai Mining (one of the subject assets of the Company's previous material asset restructuring), who acted as the counterparties of the Company's previous restructuring, issued the Commitment Letter on the Completeness of Rights in Respect of Subject Assets of the Material Asset Restructuring on 27 November 2014 and undertook that Penglai Mining would complete procedures for the State-owned Land Use Right Certificate in respect of the lands for its principal production and operation and relevant formalities for the Property Ownership Certificate in respect of operating-purpose buildings built on the lands pertained to the State-owned Land Use Right Certificate by 30 June 2016. If Penglai Mining fails to complete procedures for the State-owned Land Use Right Certificate in respect of the collective lands currently leased for its principal production and operation within the term of commitment stated above, Non-ferrous Group, Wang Zhiqiang and Jinmao Mining would, based on their respective shareholdings in Penglai Mining, buy back all equity interest of Penglai Mining at the price not lower than the net asset valuation level of Penglai Mining determined in the previous restructuring and assume the responsibility to compensate or indemnify the Company against all actual losses arising therefrom.

On 13 June 2016, the 29th meeting of the fourth session of the Board of the Company considered and passed the Resolution on Approving Non-ferrous Group, Wang Zhiqiang and Jinmao Mining to Extend the Term of Commitment in Relation to Remedying Defects of the Land and Property Ownership of Penglai Mining and submitted the resolution to the 2nd extraordinary general meeting of 2016 held by the Company on 30 June 2016 for consideration and approval, thereby extending the performance period of such commitment to 30 June 2017.

- I-2 -

APPENDIX I	OVERSEAS REGULATORY ANNOUNCEMENT OF THE COMPANY ON
	NON-FERROUS GROUP, WANG ZHIQIANG AND JINMAO MINING
	TO EXTEND THE TERM OF COMMITMENT IN RELATION TO REMEDYING
	DEFECTS OF THE LAND AND PROPERTY OWNERSHIP OF PENGLAI MINING

After making such commitment, Non-ferrous Group, Wang Zhiqiang and Jinmao Mining, as original shareholders of Penglai Mining, made their best efforts to urge and assist Penglai Mining to complete procedures for relevant certificates. Procedures for the State-owned Land Use Right Certificate in respect of the lands Penglai Mining occupies for its production and operation involved the state-owned land acquisition quota, but Penglai City had a tight land acquisition quota at the time. As a result, it was impossible to complete the procedures for all land use right certificates and property ownership certificates within the scope of commitment by 30 June 2017, and the 39th meeting of the fourth session of the Board of the Company considered and passed the Resolution on Approving Non-ferrous Group, Wang Zhiqiang and Jinmao Mining to Extend the Term of Commitment in Relation to Remedying Defects of the Land and Property Ownership of Penglai Mining and submitted the resolution to the third extraordinary general meeting of 2017 held by the Company on 14 July 2017 for consideration and approval, thereby extending the performance period of such commitment to 30 June 2020.

On 28 June 2020, the Company received letters respectively from Non-ferrous Group, Wang Zhiqiang and Jinmao Mining, which stated that although Penglai Mining has been making its best efforts to complete procedures for relevant certificates, it still could not complete the procedures for applying the certificates by 30 June 2020 as the lands and properties that have not obtained certificates were subject to the adjustment of ecological protection redline, the state-owned land acquisition quota and other factors, and asked for an extension of the performance period of the aforesaid commitment in relation to remedying defects of the land and property ownership other than the tailings depot of Penglai Mining to 30 June 2023.

1. Progress of Applying for Relevant Land and Property Certificates
   1. Progress of Applying for Land Use Right Certificates

Penglai Mining had undertook that it would apply for certificates for lands of 94,921.7 square meters. As at 30 June 2020, it has obtained land use right certificates pertaining to Huluxian Mine (Peng Guo Yong [2016] No. 0206) and Hougezhuang Mine (Peng Guo Yong [2016] No. 0205), involving lands of 15,962 square meters in total. Lands that have not obtained certificates covered 78,959.7 square meters in aggregate, including seven land parcels for the auxiliary shaft of Chugezhuang Deposit, No. 8 shaft of Hexi Deposit and the main shaft of Qijiagou Deposit, the main shaft of Qiangjiagou Deposit, the hoisting shaft of Hougezhuang Deposit, Ningjia Shaft of Huluxian Deposit and Hexi Tailings Depot. Applications in respect of such lands have been submitted to Penglai Land and Resources Bureau in 2016.

Shandong Province began to adjust the scope of ecological protection redline since 2017 and now has yet to announce the adjustment plan. The land grant formalities are subject to the obtaining of new mining permits for the boundary and capacity expansion and the integration of Huluxian Mine and Qijiagou Mine of Penglai Mining. Affected by the events stated above, the said mines of Penglai Mining have not acquired new mining permits up to date, and the applications for land certificates are therefore delayed.

- I-3 -

APPENDIX I	OVERSEAS REGULATORY ANNOUNCEMENT OF THE COMPANY ON
	NON-FERROUS GROUP, WANG ZHIQIANG AND JINMAO MINING
	TO EXTEND THE TERM OF COMMITMENT IN RELATION TO REMEDYING
	DEFECTS OF THE LAND AND PROPERTY OWNERSHIP OF PENGLAI MINING

2. Progress of Applying for Property Ownership Certificates

Penglai Mining had undertook that it would apply for property ownership certificates for properties of 9,235.55 square meters. As at 30 June 2020, it has obtained property ownership certificates pertained to properties of 2,508.71 square meters. Among those that have not obtained property ownership certificates, 1,102.5 square meters of Huluxian Mine has acquired the land use right certificate, and the property ownership certificate is subject to the approval of integration project in the mine. Property ownership certificates in respect of other properties are subject to the acquisition of respective land use certificates.

1. Continuous Consummation of Relevant Land and Property Ownership Arrangements

Non-ferrous Group, Jinmao Mining and Wang Zhiqiang will continue to urge and assist Penglai Mining for the granting of land acquisition quota for the purpose of relevant land use right certificates. After the closure, Hexi Tailings Depot will adopt land reclamation to avoid any impact on subsequent land utilization. According to the existing guidelines specified in green mine construction plans of the State and Shandong Province, it is difficult for the tailings depot to apply for the land use right certificate by way of land grant. Therefore, Penglai Mining proposes that it will not apply for the land use right certificate for Hexi Tailings Depot (41,379 square meters) within the scope of the aforesaid commitment and will use the land by way of land leasing within the scope permitted by national policies.

For other lands except the tailings depot, Penglai Mining will apply for project lands for the capacity and boundary expansion of Huluxian Gold Mine and the integration project of Qijiagou Mine after the determination of Shandong provincial ecological protection redline and address the issue of land acquisition quota in respect of such lands pending for consummation, so that it will be able to obtain relevant land and property ownership certificates.

Subsequent work plans and approval procedures for the land and property pertaining to the integration and capacity and boundary expansion projects stated above are as follows:

No.	Approval Matter	Scheduled Finish Time
1	Approval of the environmental impact assessment	June 2021
	report of Qijiagou Mine (Integration)
2	Application for the mining permit of Qijiagou Mine	December 2021
	(Integration)
3	Application for the mining permit of Huluxian	December 2021
	Gold Mine (Capacity and Boundary Expansion)
4	Approval of the 240,000-ton-resource development	June 2022
	and utilization project of Shandong Gold Group
	Penglai Mining Co., Ltd.
5	Pre-approval of construction project lands	December 2022
6	Application for property ownership certificates	June 2023

- I-4 -

APPENDIX I	OVERSEAS REGULATORY ANNOUNCEMENT OF THE COMPANY ON
	NON-FERROUS GROUP, WANG ZHIQIANG AND JINMAO MINING
	TO EXTEND THE TERM OF COMMITMENT IN RELATION TO REMEDYING
	DEFECTS OF THE LAND AND PROPERTY OWNERSHIP OF PENGLAI MINING

IV. Extension of Performance Period of the Commitment and the Supplementary Commitment

On 28 June 2020, Non-ferrous Group, Jinmao Mining and Wang Zhiqiang issued the Supplementary Commitment Letter in respect of the extension of performing the commitment: they will assist Penglai Mining to continue to apply for the State-owned Land Use Right Certificate and the Property Ownership Certificate for the land and property other than the tailings depot that have not obtained certificates within the scope permitted by the national policies; Non-ferrous Group, Jinmao Mining and Wang Zhiqiang will, based on their original shareholdings in Penglai Mining, bear the land grant fees within the scope of national policies paid in respect of applying for land use right certificates, the fees for applying for property ownership certificates, the administrative penalty fees (if incurred) caused by the land and property defects in the early stage and others. If Penglai Mining fails to complete procedures for the ownership certificates in respect of lands and properties other than the tailings depot that have not obtained certificates by 30 June 2023, upon the demand of the Company, Non-ferrous Group, Jinmao Mining and Wang Zhiqiang will, based on their respective shareholdings in Penglai Mining, buy back all equity interest of Penglai Mining at the price not lower than the net asset valuation level of Penglai Mining determined in the previous restructuring and assume the responsibility to compensate or indemnify the Company against all actual losses arising therefrom.

1. Approval Status of Board Meeting

Up to now, it has been almost four years since the Company completed its previous restructuring, during which Penglai Mining has achieved stable operation and a total of RMB410,307,400 of net profit from 2016 to 2019. The fulfilment of the profit commitment contributed to the growth of the operating results of the Company. In the meantime, Penglai Mining has not been punished by relevant authorities so far because of defects of the land and property ownership. The said counterparties have also made the supplementary commitment that they will assume the responsibility to compensate or indemnify Shandong Gold against all actual losses arising therefrom in the future.

The 37th meeting of the fifth session of the Board held on 23 July 2020 considered and passed the Resolution on Approving Non-ferrous Group, Wang Zhiqiang and Jinmao Mining to Extend the Term of Commitment in Relation to Remedying Defects of the Land and Property Ownership of Penglai Mining, with six votes for, zero against and zero abstained (Li Guohong, Wang Lijun and Wang Xiaoling, being interested Directors, abstained from voting), and agreed to the proposal that Non-ferrous Group, Wang Zhiqiang and Jinmao Mining will extend the performance period of the commitment in relation to consummating the land and property ownership of Penglai Mining to 30 June 2023 and that Penglai Mining will not apply for the State-owned Land Use Right Certificate for the land in respect of Hexi Tailings Depot (41,379 square meters) and use the land by way of land leasing within the scope permitted by national policies.

- I-5 -

APPENDIX I	OVERSEAS REGULATORY ANNOUNCEMENT OF THE COMPANY ON
	NON-FERROUS GROUP, WANG ZHIQIANG AND JINMAO MINING
	TO EXTEND THE TERM OF COMMITMENT IN RELATION TO REMEDYING
	DEFECTS OF THE LAND AND PROPERTY OWNERSHIP OF PENGLAI MINING

VI. Opinions from the Independent Non-executive Directors

The independent non-executive Directors of the Company confirmed prior to submission of the resolution to the Board for consideration, and issued the independent opinions as follows:

1. The original term of commitment of the application for land certificates is delayed as Shandong Gold Group Penglai Mining Co., Ltd. ("Penglai Mining") was affected by the adjustment of ecological protection redline in Shandong Province, the application of new mining permit and other factors. Shandong Gold Non-ferrous Metal Mine Group Co., Ltd., the natural person Wang Zhiqiang and Yantai Jinmao Mining Co., Ltd., being original shareholders, intended to extend the term of commitment of remedying defects of the land and property ownership of Penglai Mining and Hexi Tailings Depot of Penglai Mining used the land by way of land leasing within the scope permitted by national policies. Aforesaid measures are helpful to original shareholders in facilitating Penglai Mining in applying for land use rights and housing ownership certificates. Original shareholders bear the cost of applying certificates under national policies. Aforesaid measures are reasonable and fair, without prejudice to the interests of the Company and other shareholders.
2. The extension of the performance period of the commitment in relation to remedying defects of the land and property ownership of Penglai Mining by Non-ferrous Group, Wang Zhiqiang and Jinmao Mining constitutes a connected transaction. Interested directors have abstained from voting for the approval of the resolution which was approved.

It is agreed to submit the resolution to the 2nd extraordinary general meeting of 2020 of the Company for consideration.

The announcement is hereby made.

The Board of Shandong Gold Mining Co., Ltd.

23 July 2020

- I-6 -

APPENDIX II	OVERSEAS REGULATORY ANNOUNCEMENT OF THE COMPANY ON
	SHARE COMPENSATION FOR NOT REALIZING PERFORMANCE
	COMMITMENT AGAINST THE SUBJECT ASSETS UNDER THE
	COMPANY'S MATERIAL ASSET RESTRUCTURING
Stock Code: 600547	Stock Abbreviation: SD GOLD	Announcement No.: Lin 2020-051

SHANDONG GOLD MINING CO., LTD.

ANNOUNCEMENT ON SHARE COMPENSATION

FOR NOT REALIZING PERFORMANCE COMMITMENT OF

THE SUBJECT ASSETS UNDER THE MATERIAL ASSET RESTRUCTURING

The Company and all members of the board of directors as a whole warrant the truthfulness, accuracy and completeness of the contents of this announcement, and severally and jointly accept the responsibility in case there are false representations and misleading statements contained in, or material omissions from, this announcement.

Important Notes:

• The Company received the approval in 2015 and completed the material asset restructuring (the "Previous Restructuring") in 2016, with one of the counterparties being Non-ferrous Group failed to realize the committed performance in the Previous Restructuring in 2016 and should compensate the Company with 13,015,060 ordinary A shares of the Company received in the Previous Restructuring (after the Company executed the 2018 annual profit distribution plan through issuing four shares for every ten shares by way of conversion of capital reserve, the number of shares to be compensated increases to 18,221,084 shares; on 24 June 2020, the general meeting of the Company considered and approved the 2019 annual profit distribution plan through issuing four shares for every ten shares by way of conversion of capital reserve, the number of shares to be compensated shall be adjusted according to the number of shares following the capitalization issue. The number of shares compensated by Non-ferrous Group refer to the number of shares before the implementation of 2019 annual profit distribution plan).
• The Company will buy back these 18,221,084 compensation shares at the consideration of RMB1, and these shares shall be cancelled.
• The buy-back and cancellation of shares to be compensated by Non-ferrous Group shall be submitted to the general meeting, A class shareholders meeting and H class shareholders meeting for consideration. Non-ferrous Group is a connected party of the Company, and the buy-back of compensation shares constitutes a connected transaction.
• The existing total share capital of the Company is the aggregate of A shares and H shares. However, shares issued in the Previous Restructuring by the Company are all A shares; therefore, the number of shares, the number of compensation shares and the total share capital stated in this announcement all represent A shares. Upon the buy-back and cancellation, the total number of A shares will be reduced, while the total number of H shares will not be affected.
• If the general meeting of the Company does not approve the buy-back proposal stated above, shareholders other than Non-ferrous Group are entitled to receive the shares compensated by Non-ferrous Group at nil consideration.

- II-1 -

APPENDIX II	OVERSEAS REGULATORY ANNOUNCEMENT OF THE COMPANY ON
	SHARE COMPENSATION FOR NOT REALIZING PERFORMANCE
	COMMITMENT AGAINST THE SUBJECT ASSETS UNDER THE
	COMPANY'S MATERIAL ASSET RESTRUCTURING

1. Background of the Share Compensation

Approved by China Securities Regulatory Commission pursuant to "the Approval on the Asset Acquisition and Relevant Fundraising of Shandong Gold Mining Co., Ltd. by Issuing Shares to Shandong SDG Group Co., Ltd. and Other Entities" (Zheng Jian Xu Ke [2015] No. 2540), Shandong Gold Mining Co., Ltd. (the "Company" or "Shandong Gold") completed the asset acquisition and relevant fundraising by issuing shares and the connected transaction (the "Previous Restructuring") in October 2016. In the Previous Restructuring, the Company issued shares to Shandong SDG Group Co., Ltd. ("SDG Group"), Shandong Gold Non-ferrous Metal Mine Group Co., Ltd. ("Non-ferrous Group"), Shandong SDG Exploration Co., Ltd. ("SDG Exploration"), Yantai City Jinmao Mining Co., Ltd. and Wang Zhiqiang, to acquire the exploration and mining permits of Dongfeng mine area and relevant assets and liabilities, the exploration permit of Xinli mine area, 70.65% equity interest in Guilaizhuang Company and 100% equity interest in Penglai Mining.

According to "Measures for the Administration of the Material Asset Restructurings of Listed Companies", income approach shall be adopted in the evaluation and shall serve as the pricing basis; parties of a transaction shall enter into a compensation agreement when the actual profits of relevant assets fall short of the profit forecast. As such, the Company has signed the Profit Forecast Compensation Agreement and relevant supplemental agreement (the "Agreement") with SDG Group, Non-ferrous Group and SDG Exploration.

1. Specific Terms and Execution of Profit Forecast Compensation
2. 1. Committed compensation period of profit forecast. Pursuant to the Agreement, the committed compensation period in respect of SDG Group, Non-ferrousGroup and SDG Exploration and their subject assets fully expires in the fourth year after the completion of the Previous Restructuring, being the year of 2019.

1. Beneficiaries and amounts of profit forecast compensation. According to the special audit reports on the realization of committed performance, which is issued by TianYuanQuan Certified Public Accountants for the period from 2017 to 2020, during the performance commitment period, both SDG Group and SDG Exploration have achieved the committed profits for the performance commitment period, while Non-ferrousGroup failed to achieve the performance commitment for the year of 2016. In accordance with the Profit Forecast Compensation Agreement and the calculation based on the terms of the supplemental agreement, the number of shares which Non-ferrousGroup should compensate is 13,015,060 shares, and relevant matters have been considered and approved by the Company at the 36th meeting of the fourth session of the Board held on 11 April 2017, further details of which are set out in the Announcement of Shandong Gold Mining Co., Ltd. on the Profit Commitment of Guilaizhuang Company for 2016 and the Compensation (Reference No.: Lin 2017-026).

- II-2 -

APPENDIX II	OVERSEAS REGULATORY ANNOUNCEMENT OF THE COMPANY ON
	SHARE COMPENSATION FOR NOT REALIZING PERFORMANCE
	COMMITMENT AGAINST THE SUBJECT ASSETS UNDER THE
	COMPANY'S MATERIAL ASSET RESTRUCTURING

Pursuant to the Agreement, if there are ex-right and ex-dividend activities including bonus issue, allotment and capitalization issue during the profit forecast compensation period, the number of shares which parties of the Previous Restructuring should compensate shall be adjusted accordingly. In August 2019, the Company implemented the 2018 Annual Profit Distribution Plan, issuing additional 0.4 share for each existing share to all shareholders; therefore, the number of shares which Non-ferrous Group should compensate increased to 18,221,084 shares.

1. Impairment test. Pursuant to the Agreement, the Company has engaged TianYuanQuan Certified Public Accountants to conduct impairment test on the subject assets when the profit forecast compensation period expires, which has issued the Special Audit Report on Impairment Test of Subject Assets Injected in the Material Asset Restructuring (TianYuanQuan Zhuan Shen Zi [2020] No. 000150, TianYuanQuan Zhuan Shen Zi [2020] No. 000151 and TianYuanQuan Zhuan Shen Zi [2020] No. 000152). The value of respective subject assets of the Previous Restructuring as at 31 December 2019, net of capital increase and capital reduction by shareholders, acceptance of grants and profit distribution that have affected subject assets during the performance commitment period, upon calculation and making comparison with the transaction consideration of the Previous Restructuring, indicates that no impairment has been incurred, SDG Group, Non-ferrous Group and SDG Exploration is not obliged to make any share compensation.

(IV) Profit distribution. Pursuant to the Agreement, if the Company makes cash distribution during the profit forecast compensation period, the corresponding cash distribution portion in respect of compensation shares shall be refunded accordingly. Since Non-ferrous Group failed to achieve the profit commitment in 2016, compensation shares have not received any corresponding cash dividends in the previous profit distributions.

1. The compensation amount for its failing to realize performance commitment

As set out above, SDG Group and SDG Exploration, the counterparties to the Previous Restructuring, have both fulfilled the committed profits for the respective performance commitment periods, while Non-ferrous Group, another counterparty to the Previous Restructuring, needs to compensate the Company and cancel of 18,221,084 shares for the year of

2016. The details are as follows:

	Number of shares
	acquired by the
	counterparty due	Number of shares	Amount of cash
	to acquisition of	to be	subject to return
	assets by issuance	compensated to	by the issuance
Counterparty	of shares	the issuer	object
			(RMB)
Non-ferrous Group	100,704,999	18,221,084	0.00

Note: Difference may exist due to rounding between certain total amounts and the direct arithmetical sum of the

respective addends.

- II-3 -

APPENDIX II	OVERSEAS REGULATORY ANNOUNCEMENT OF THE COMPANY ON
	SHARE COMPENSATION FOR NOT REALIZING PERFORMANCE
	COMMITMENT AGAINST THE SUBJECT ASSETS UNDER THE
	COMPANY'S MATERIAL ASSET RESTRUCTURING

1. Share-basedCompensation Plan
2. 1. Targeted Buy-back and Cancellation

In respect of the 18,221,084 shares that Non-ferrous Group is required to compensated, the Company will buy back at an aggregate consideration of RMB1.00 and cancel the same pursuant to the Agreement. At the 37th meeting of the fifth session of the Board, the Company considered and approved "the Resolution Relating to Share Compensation for not Realizing Performance Commitment against the Subject Assets under the Material Asset Restructuring of the Company".

Upon completion of such buy-back and cancellation of the compensation shares, the total share capital of the Company will be reduced from 3,099,611,632 shares to 3,081,390,548 shares. The shareholding structure changes are set out below (on 24 June 2020, the general meeting of the Company has considered and approved the 2019 distribution annual profit profit plan through issuing four shares for every ten shares by way of conversion of capital reserve, and the total share capital of the Company shall be adjusted accordingly):

		Prior to the buy-back and		After the buy-back and
		cancellation	This change	cancellation
		Number	Proportion	Number	Number	Proportion
I.	Restricted shares	249,649,808	8.05%	-18,221,084	231,428,724	7.51%
	1. Restricted A shares	249,649,808	8.05%	-18,221,084	231,428,724	7.51%
	(1) Shares held by state-owned legal
	person(s)	249,649,808	8.05%	-18,221,084	231,428,724	7.51%
II.	Unrestricted shares	2,849,961,824	91.95%	0	2,849,961,824	92.49%
III.	Total share capital	3,099,611,632	100%	-18,221,084	3,081,390,548	100%

1. Review Procedure

As the Resolution involves reduction of share capital caused by buy-back and cancellation of shares by the Company, it shall be submitted to the general meeting and the class general meetings of A shares and H shares of the Company for consideration. Non-ferrous Group is a subsidiary of our controlling shareholder SDG Group, and same as SDG Exploration, is also a shareholder of the Company. Therefore, the targeted buy-back constitutes a connected transaction, for which the interested directors are required to abstain from voting for the Resolution when considered by the Board, while the interested shareholders are also required to abstain from voting for it when the Resolution is considered by the general meeting.

- II-4 -

APPENDIX II	OVERSEAS REGULATORY ANNOUNCEMENT OF THE COMPANY ON
	SHARE COMPENSATION FOR NOT REALIZING PERFORMANCE
	COMMITMENT AGAINST THE SUBJECT ASSETS UNDER THE
	COMPANY'S MATERIAL ASSET RESTRUCTURING

1. Cancellation Arrangement

After the relevant transactions are considered at the general meeting, the Company will process with relevant procedures according to the requirements of the Shanghai Stock Exchange and the Shanghai Branch of China Securities Depository and Clearing Corporation Limited in relation to transfer and cancellation of shares, and make prompt information disclosure as required.

1. Measures Adopted in case of Veto by the General Meeting on the Resolution Relating to Targeted Buy-back of Compensation Shares and Cancellation of Shares

Pursuant to the provisions in the Agreement, if the aforesaid targeted buy-back resolution is not passed by the general meeting, the Company shall notify Non-ferrous Group in writing within 10 business days upon publication of the poll results announcement of the general meeting, while Non-ferrous Group shall, within 30 days from its receipt of such notice, give the aforesaid shares subject to compensation ex-gratia to other shareholders other than Non-ferrous Group which are registered as shareholders of the Company on such share record date as determined by the announcement relating to the implementation of such ex-gratia shares. Other shareholders would be given with shares as per the proportion of their respective shareholding against the number of shares of the Company (shares held by Non-ferrous Group shall be excluded for this purpose) as at the share record date.

The number of shares which should be compensated by Non-ferrous Group to other shareholders is 18,221,084, and its shareholding would be 82,483,915 shares upon completion of such ex-gratis shares, reduced from 3.25% to 2.66% in terms of proportion of shareholding. Accordingly, the proportion taken by other shareholders other than Non-ferrous Group will be increased from 96.75% to 97.34%, with the total share capital of the Company remains unchanged.

IV. Consideration by the Board

At the 37th meeting of the fifth session of the Board convened on 23 July 2020, the Company considered and approved the Resolution Relating to Share Compensation for not Realizing Performance Commitment against the Subject Assets under the Material Asset Restructuring of the Company, with six votes for, zero against and zero abstained (Li Guohong, Wang Lijun and Wang Xiaoling, being interested directors, abstained from voting in respect of this resolution), and the Resolution Relating to Submission to the General Meeting for Authorising the Board with Absolute Discretion to Facilitate the Buy-back or Grant of Compensation Shares was approved with nine votes for, zero against and zero abstained.

- II-5 -

APPENDIX II	OVERSEAS REGULATORY ANNOUNCEMENT OF THE COMPANY ON
	SHARE COMPENSATION FOR NOT REALIZING PERFORMANCE
	COMMITMENT AGAINST THE SUBJECT ASSETS UNDER THE
	COMPANY'S MATERIAL ASSET RESTRUCTURING

1. Opinions from the Independent Non-executive Directors

The independent non-executive directors of the Company confirmed prior to submission of the resolution to the Board for consideration, and issued the independent opinions as follows:

1. Shandong Gold Non-ferrous Metal Mine Group Co., Ltd. ("Non-ferrous Group") proposes to offer share compensation to the Company in respect of its failure to fulfill the committed profits for 2016 pursuant to the way of compensation as agreed in the Profit Forecast Compensation Agreement entered into between Non-ferrous Group and the Company. The share compensation plan is in compliance with the Profit Forecast Compensation Agreement, the number of compensation shares is accurate under reasonable and fair plan in line with relevant laws and rules, and there is no prejudice to the interests of the Company and other shareholders.
2. The targeted buy-back from Non-ferrous Group of the shares subject to compensation involves connected transaction, thereby the interested directors have abstained from voting by laws when the relevant resolution is considered. The resolution has been duly considered and approved.

It is agreed to submit the "Resolution Relating to Share Compensation for not Realizing Performance Commitment against the Subject Assets under the Material Asset Restructuring of the Company" to the 2nd Extraordinary General Meeting for 2020, the 3rd Class Meeting of A Class Shareholders for 2020 and the 3rd Class Meeting of H Class Shareholders for 2020 of the Company for further consideration, and to submit the "Resolution Relating to Submission to the General Meeting for Authorising the Board with Absolute Discretion to Facilitate the Buy-back or Grant of Compensation Shares" to the 2nd Extraordinary General Meeting for 2020 for consideration.

VI. Verification Opinion from Independent Financial Advisor

CITIC Securities Co., Ltd., the independent financial advisor engaged by the Company for the Previous Restructuring, issued the verification opinion and held the view that since the assets injected by Non-ferrous Group failed to achieve the profits committed during the previous material asset restructuring, the counterparties shall compensate the Company with corresponding shares under the Profit Forecast Compensation Agreement and the supplemental agreements entered into by the parties to the previous material asset restructuring. It is advised that the listing company and counterparty shall be in compliance with the relevant provisions and procedure regarding to material asset restructuring, and fulfill the share compensation commitment for not realizing performance commitment under the material asset restructuring, and ensure the interests of small and medium investors are protected.

- II-6 -

APPENDIX II	OVERSEAS REGULATORY ANNOUNCEMENT OF THE COMPANY ON
	SHARE COMPENSATION FOR NOT REALIZING PERFORMANCE
	COMMITMENT AGAINST THE SUBJECT ASSETS UNDER THE
	COMPANY'S MATERIAL ASSET RESTRUCTURING

For details, please refer to the Verification Opinion Issued by CITIC Securities Co., Ltd. for Shandong Gold Mining Co., Ltd. in respect of the Share Compensation Involved in the Profits Commitment Made during the Previous Material Asset Restructuring disclosed by the Company on the same date.

The announcement is hereby made.

The Board of Shandong Gold Mining Co., Ltd.

23 July 2020

- II-7 -

APPENDIX III	NOTICE OF 2020 SECOND EXTRAORDINARY GENERAL MEETING

SHANDONG GOLD MINING CO., LTD.

山東黃金礦業股份有限公司

(a joint stock company incorporated in the People's Republic of China with limited liability)

(Stock Code: 1787)

NOTICE OF 2020 SECOND EXTRAORDINARY GENERAL MEETING

NOTICE IS HEREBY GIVEN that the 2020 Second Extraordinary General Meeting ("EGM") of Shandong Gold Mining Co., Ltd. (the "Company") will be held at the conference room of the Company, Building No. 3, Shuntai Plaza, Shunhua Road No. 2000, Jinan, Shandong Province, the PRC at 9:00 a.m. on Tuesday, 25 August 2020 for the purpose of considering and, if thought fit, passing the following resolutions:

ORDINARY RESOLUTION

1. To approve the resolution on agreeing Non-ferrous Group, Wang Zhiqiang and Jinmao Mining to extend the term of commitment in relation to remedying defects of the land and property ownership of Penglai Mining.

SPECIAL RESOLUTION

2. To approve the resolution on share compensation plan for not realizing performance commitment of the Subject Assets under the material asset restructuring of the Company.

ORDINARY RESOLUTION

3. To approve the resolution relating to submission to the general meeting for authorising the board with full discretion to facilitate the buy-back or grant of compensation shares.

By order of the Board

Shandong Gold Mining Co., Ltd.

Li Guohong

Chairman

Jinan, the PRC

31 July 2020

As at the date of this notice, the executive directors of the Company are Mr. Wang Peiyue, Mr. Li Tao and Mr. Tang Qi; the non-executive directors of the Company are Mr. Li Guohong, Mr. Wang Lijun and Ms. Wang Xiaoling; and the independent non-executive directors of the Company are Mr. Gao Yongtao, Mr. Lu Bin and Ms. Hui Wing.

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APPENDIX III	NOTICE OF 2020 SECOND EXTRAORDINARY GENERAL MEETING

Notes:

1. All holders of H Shares whose names appear on the register of members of the Company on Thursday, 20 August 2020 are entitled to attend the EGM and should bring along their identity cards or passports when attending the EGM. Holders of the Company's H Shares should note that the register of members of the Company will be closed from Thursday, 20 August 2020 to Tuesday, 25 August 2020 (both dates inclusive). All transfer documents accompanied by the relevant share certificates must be lodged with the Company's H share registrar, namely Tricor Investor Services Limited at Level 54, Hopewell Centre, 183 Queen's Road East, Hong Kong no later than 4:30 p.m. on Wednesday, 19 August 2020. The record date and arrangements in respect of the holders of A Shares of the Company who are entitled to attend the EGM will be determined and announced separately in the PRC.
2. Any shareholder entitled to attend and vote at the EGM is entitled to appoint a proxy or more proxies (who need not be a shareholder of the Company) to attend the EGM and vote thereat in his stead. For any shareholder who appoints more than one proxy, the voting right can only be exercised by his/her proxies on a poll.
3. Any shareholder who intends to appoint a proxy to attend the EGM shall put it in writing, with the proxy form to be signed by the appointor or his attorney duly authorized in writing. If the appointor is a corporation, the proxy form must be affixed with its common seal, or signed by any of its directors or attorney duly authorized in writing. If the proxy form is signed by an attorney authorized by the appointer, the power of attorney or other authorization documents must be notarially certified. The notarially certified power of attorney or other authorization documents together with the proxy form must be delivered to the Company's H share registrar, Tricor Investor Services Limited at Level 54, Hopewell Centre, 183 Queen's Road East, Hong Kong (for H shareholders only) not later than 24 hours before the time appointed for the holding of the EGM (i.e. before 9:00 a.m. on Monday, 24 August 2020). Completion and return of the proxy form will not affect the rights of the shareholders to attend and vote at the EGM in person.
4. Proxies of holders of the Company's H Shares shall bring along the proxy form, instrument(s) for appointing a proxy (if applicable) and the proxies' identity cards or passports to attend the EGM.
5. According to Article 108 of the Articles of Association, an ordinary resolution shall be passed by more than half of the votes cast by the shareholders (including proxies) present at the general meeting, while a special resolution shall be passed by more than two-thirds of the votes cast by the shareholders (including proxies) present at the general meeting.
6. Directors, supervisors and senior management of the Company and the witnessing lawyers and other relevant personnel employed by the Company will attend the EGM.

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APPENDIX IV	NOTICE OF 2020 THIRD H SHARES CLASS MEETING

SHANDONG GOLD MINING CO., LTD.

山東黃金礦業股份有限公司

(a joint stock company incorporated in the People's Republic of China with limited liability)

(Stock Code: 1787)

NOTICE OF 2020 THIRD H SHARES CLASS MEETING

NOTICE IS HEREBY GIVEN that the 2020 Third Class Meeting for H Shares (the "H Shares Class Meeting") of Shandong Gold Mining Co., Ltd. (the "Company") will be held immediately after the conclusion of the 2020 Third Class Meeting for Holders of Domestic Listed Shares (A shares) (or any adjourned meeting thereof) of the Company at the conference room of the Company, Building No. 3, Shuntai Plaza, Shunhua Road No. 2000, Jinan, Shandong Province, the PRC on Tuesday, 25 August 2020 for the purpose of considering and, if thought fit, passing the following resolution:

SPECIAL RESOLUTION

1. To approve the resolution on share compensation plan for not realizing performance commitment of the Subject Assets under the material asset restructuring of the Company.

By order of the Board

Shandong Gold Mining Co., Ltd.

Li Guohong

Chairman

Jinan, the PRC

31 July 2020

As at the date of this notice, the executive directors of the Company are Mr. Wang Peiyue, Mr. Li Tao and Mr. Tang Qi; the non-executive directors of the Company are Mr. Li Guohong, Mr. Wang Lijun and Ms. Wang Xiaoling; and the independent non-executive directors of the Company are Mr. Gao Yongtao, Mr. Lu Bin and Ms. Hui Wing.

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APPENDIX IV	NOTICE OF 2020 THIRD H SHARES CLASS MEETING

Notes:

1. All holders of H Shares whose names appear on the register of members of the Company on Thursday, 20 August 2020 are entitled to attend the H Shares Class Meeting and should bring along their identity cards or passports when attending the H Shares Class Meeting. Holders of the Company's H Shares should note that the register of members of the Company will be closed from Thursday, 20 August 2020 to Tuesday, 25 August 2020 (both dates inclusive). All transfer documents accompanied by the relevant share certificates must be lodged with the Company's H share registrar, Tricor Investor Services Limited at Level 54, Hopewell Centre, 183 Queen's Road East, Hong Kong no later than 4:30 p.m. on Wednesday, 19 August 2020.
2. Any shareholder entitled to attend and vote at the H Shares Class Meeting is entitled to appoint a proxy or more proxies (who need not be a shareholder of the Company) to attend the H Shares Class Meeting and vote thereat in his stead. For any shareholder who appoints more than one proxy, the voting right can only be exercised by his/her proxies on a poll.
3. Any shareholder who intends to appoint a proxy to attend the H Shares Class Meeting shall put it in writing, with the proxy form to be signed by the appointor or his attorney duly authorized in writing. If the appointor is a corporation, the proxy form must be affixed with its common seal, or signed by any of its directors or attorney duly authorized in writing. If the proxy form is signed by an attorney authorized by the appointer, the power of attorney or other authorization documents must be notarially certified. The notarially certified power of attorney or other authorization documents together with the proxy form must be delivered to the Company's H share registrar, Tricor Investor Services Limited at Level 54, Hopewell Centre, 183 Queen's Road East, Hong Kong (for H shareholders only) not later than 24 hours before the time appointed for the holding of the H Shares Class Meeting (i.e. before 9:00 a.m. on Monday, 24 August 2020). Completion and return of the proxy form will not affect the rights of the shareholders to attend and vote at the H Shares Class Meeting in person.
4. Proxies of holders of the Company's H Shares shall bring along the proxy form, instrument(s) for appointing a proxy (if applicable) and the proxies' identity cards or passports to attend the H Shares Class Meeting.
5. According to Article 108 of the Articles of Association, an ordinary resolution shall be passed by more than half of the votes cast by the shareholders (including proxies) present at the general meeting, while a special resolution shall be passed by more than two-thirds of the votes cast by the shareholders (including proxies) present at the general meeting.
6. Directors, supervisors and senior management of the Company and the witnessing lawyers and other relevant personnel employed by the Company will attend the H Shares Class Meeting.

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