Zijin Mining : (H Share)Announcement in relation to the Dilutive Impact of the Public Issuance of A Shares on Immediate Returns and the Adoption of Recovery Measures

Overseas Regulatory Announcement

This announcement was published on the website of Shanghai Stock Exchange of the People's Republic of China by Zijin Mining Group Co., Ltd.* (the "Company").

The announcement is written in both Chinese and English. In the case of any discrepancies, the Chinese version shall prevail over its English version.

1 January 2019, Fujian, the PRC

*The Company's English name is for identification purposes only

Stock code: 601899

Stock name: Zijin MiningNo.: Lin 2018-076

Zijin Mining Group Co., Ltd.*Announcement in relation to the Dilutive Impact of the Public Issuance of A Shares on Immediate

Returns and the Adoption of Recovery Measures

The Company and the board of directors of the Company hereby warrant that the contents contained herein are true, accurate and complete, and there are no false representations or misleading statements contained in, or material omissions from this announcement, and jointly and severally accept responsibility for the authenticity, accuracy and completeness of the content herein.

Matters relating to the public issuance of A Shares (the "Public Issuance" or "Issuance") of Zijin Mining Group Co., Ltd.* (the "Company") have been considered and approved at the fifteenth extraordinary meeting of the sixth term of the board of directors of the Company (the "Board"). The Public Issuance is still subject to the approvals of the shareholders' general meetings and the China Securities Regulatory Commission (the "CSRC"). Pursuant to the relevant regulations including "Opinion of the General Office of the State Council on Further Strengthening the Protection of the Legitimate Rights and Interests of Minority Investors in the Capital Market" (Guobanfa [2013] No. 110), "Certain Opinion of the State Council on Further Promoting the Healthy Development of the Capital Market" (Guofa [2014] No. 17), and "Guiding Opinion on Matters Relating to Dilution of Immediate Return in Initial Public Offering, Refinancing and Material Asset Restructuring" (CSRC Announcement [2015] No. 31), the Company hereby conducts intensive analysis on the dilutive impact of matters relating to the Public Issuance on immediate returns, and detailed recovery measures in response to the dilutive impact were formulated. Undertakings are made by the relevant parties for the rigorous implementation of the Company's recovery measures in response to the dilutive impact on immediate returns. Details are as follows:

I. The necessity and rationality of the Issuance

(1) Increase resources reserve volume and enhance core competiveness

The Company insists on emphasising on internationalisation strategy, strengthens its comparative advantages in gold, copper, zinc and other mineral products. The acquisition of Nevsun Resources Ltd. ("Nevsun") to obtain the control of the upper zone of the Timok copper-gold mine and the Bisha copper-zinc mine will substantially increase the quality resources reserve volume of the Company. Upon completion of the acquisition, the copper resources reserve of the Company will increase by 8.253 million tonnes (on equity basis), representing 26.22% of the Company's current copper resources reserve; the gold resources reserve of the Company will increase by 241.80 tonnes (on equity basis), representing 18.32% of the Company's current gold resources reserve; the zinc resources reserve of the Company will increase by 1.877 million tonnes (on equity basis), representing 23.97% of the Company's current zinc resources reserve. Therefore, the acquisition can contribute to the continuous increase in the resources reserve volume of the Company, enhance its core competitiveness and elevate its global industrial status.

(2) Expand the production scale and enhance the corporate profitability

Nevsun owns two core assets including the Timok copper-gold mine and the Bisha copper-zinc mine. The Timok copper-gold mine is yet to be developed, while the Bisha copper-zinc mine is currently in production. The Timok copper-gold mine possesses large resources reserve volume with high-grade mineral resourcesat the upper zone. It is expected that promising returns can be brought to the Company in the future. The profit of the Bisha copper-zinc mine for the period from January to September 2018 was USD23.12 million.

In addition, during the period of project construction and operation, the Company will use its own technological advantages and experience in operation and management to optimise and adjust construction plan and production process, in order to reduce costs of investment, production and operation, and enhance the profit contribution of the project acquired. The smooth implementation of the project to be invested by the proceeds raised will create a new source of profit growth for the Company and boost its profits.

(3) Meet the capital demand and optimise financial structure

As at 30 September 2018, the debt-to-asset ratio of the Company (under consolidation basis) was 58.08%. In accordance with the pre-acquisition agreement, the consideration for acquiring 100% interest of Nevsun is CAD$ 1,858,499,430, equivalent to approximately RMB9.3633060 billion. The Company will invest in the project with self-financed fund according to the actual development progress of the project before the proceeds raised in the Public Issuance are deposited in the account. If the acquisition is entirely funded by debt financing, the debt-to-asset ratio of the Company will rise. After the proceeds raised in the Public Issuance are deposited in the account, the proceeds raised in the Public Issuance will be used to substitute the Company's self-financed fund, thus reducing finance cost and optimising the Company's financial structure.

II. The relationship between the project to be invested by the proceeds raised and the Company's current business, and talent, technology, and market reserves of the Company in relation to the project to be invested by the proceeds raised

(1) The relationship between the project to be invested by the proceeds raised and the Company's current business

The Company is a large-scale mining group focusing on exploration and development of mineral resources including gold, copper, zinc and other base metals with high technology and efficiency. It is mainly engaged in the exploration, mining, refining and processing of gold, copper, lead and zinc and other mineral resources, and sales of related products. Through the project to be invested by the proceeds raised, the Company will increase reserve volume and production capacity of copper, gold and zinc, building a solid foundation for the sustainable development of the Company in the long run.

(2) Talent reserve

After years of practice, the Company has accumulated much valuable experience in the aspects of overseas capital operation, operation and management. A set of sound and rigorous operating procedures has been formed. A professional team with global vision has been nurtured for overseas operation. The progress of internationalisation has been accelerated with good operating results.

When the Company introduces quality talent with international operation experience, expatriate of Chinese employees, and nurture of local employees and localisation for overseas projects are highly emphasised as well. As at the date of this announcement, the number of core technicians and management personnel assigned overseas from China exceeds 110, and the number of Chinese and foreign staff in overseas projects exceeds 9,100.

(3) Technology reserve

Innovation in science and technology is the core competitiveness to support the Company's development. After years of investment in technological research, development and accumulation, a technological innovation system with Zijin characteristics and a batch of independent intellectual property rights and scientific research achievements have been formed. The Company has core technology and comparative competitiveness in the industry in the aspects of geological exploration, conventional mining and processing, hydrometallurgy, integrated recovery and utilisation of low-grade refractory resources and large-scale engineering development, etc. The Company owns high-level research and development platforms and design entities for scientific research including the State Key Laboratory for integrated utilisation of low grade refractory gold resources, which is the only laboratory of its kind in the gold industry, the state-level enterprise technology centre, workstations for academicians/experts, workstations for post-doctors' scientific research, research institutes of mining and metallurgy, testing companies, etc. The Company and several of its subsidiaries obtained the honour of "High and New Technology Enterprises".

(4) Market conditions

China is the largest consumption market for metal mineral products in the world. China consumes 40-50% of the global base metal products, but domestic supply is scarce. China imports over 50% of iron, copper, aluminium and gold, etc. The main products of the project acquired this time are domestically scarce strategic resources.

III. Estimation on the impact of the Public Issuance on the major financial indicators of the Company (1) The major assumptions for estimation on the impact of the Public Issuance on the major financial indicators of the Company

The following assumptions only apply to the estimation on the impact of the Public Issuance on the major financial indicators of the Company. It does not represent the Company's judgement on its operating situation and trend for the years of 2018 and 2019, and does not constitute a profit forecast of the Company. Investors shall not make investment decisions based on such estimation and the Company will not be liable for any loss arising from any investment decision thus made.

1. Assuming that there is no material adverse change in the macroeconomic environment, industrial policies, industrial development and the securities market;

• 2. Assuming that the Company completes the Public Issuance in October 2019.

• 3. Assuming that the number of shares to be issued in the Public Issuance is 3.4 billion;

• 4. Assuming that the final total amount of proceeds raised in the Public Issuance is RMB8 billion (including issuance expenses);

5. Assuming that the Company's net profits before and after non-recurring profit or loss attributable to the shareholders of listed company in 2018 are 4/3 times of those disclosed in the third quarterly report 2018; assuming that the Company's net profits before and after non-recurring profit or loss attributable to the shareholders of listed company in 2019 remain approximately the same with those in the year of 2018;

6. Assuming that there is no change in the total share capital of the Company due to conversion of capital reserve into share capital or distribution of bonus shares in the years of 2018 and 2019;

7. The effects of the proceeds raised in the Issuance after deposited in the account on the Company's operating status, financial situation (financial expenses, investment income, etc.) are not taken into consideration.

The abovementioned assumptions are only the estimations made by the Company, which do not represent the Company's judgement on the completion time, number of shares to be issued and amount of the proceeds raised in the Public Issuance. The number of shares to be issued, amount of the proceeds raised and actual completion time as approved by the CSRC shall prevail.

(2) Impact on the major financial indicators of the Company

Based on the abovementioned assumptions, pursuant to the "Compilation Rules for Information Disclosure by Companies Offering Securities to the Public No. 9 - Calculation and Disclosure of Return on Net Assets and Earnings per Share" (2010 Amendment) and other relevant regulations, the Company estimates the dilutive impact of the Public Issuance on the immediate returns to the shareholders as below:

Items	Amount/Number	Calculation
I. Number of shares
Total number of shares as at the end of 2017	23,031,218,891	a
Total number of shares as at the end of 2018	23,031,218,891	b=a
Total number of shares to be issued	3,400,000,000	c
Total number of shares after the Public Issuance	26,431,218,891	d=b+c
Weighted average number of total shares in 2018	23,031,218,891	e=b
Weighted average number of total shares in 2019	23,597,885,558	f=b+c*2/12
II. Net profit
Net profit attributable to owners of the parent after non-recurring profit or loss in 2018	RMB4,302,340,984	g
Net profit attributable to owners of the parent after non-recurring profit or loss in 2019	RMB4,302,340,984	h=g
Net profit attributable to owners of the parent before non-recurring profit or loss in 2018	RMB4,469,825,420	i
Net profit attributable to owners of the parent before non-recurring profit or loss in 2019	RMB4,469,825,420	j=i
III. Earnings per share
Earnings per share of 2018 (basic and dilutive, after non-recurring profit or loss)	RMB0.1868	k=g/e
Earnings per share of 2019 (basic and dilutive, after non-recurring profit or loss)	RMB0.1823	l=h/f
Change in earnings per share (after non-recurring profit or loss)	-RMB0.0045	m=l-k
Earnings per share of 2018 (basic and dilutive, before non-recurring profit or loss)	RMB0.1941	n=i/e
Earnings per share of 2019 (basic and dilutive, before non-recurring profit or loss)	RMB0.1894	o=j/f
Change in earnings per share (before non-recurring profit or loss)	-RMB0.0047	p=o-n