Pan African Resources : Operational Update

Pan African Resources PLC

(Incorporated and registered in England and Wales under Companies Act 1985 with registered number 3937466 on 25 February 2000)

AIM Code: PAF

JSE Code: PAN

ISIN: GB0004300496

(“Pan African” or the “Company”)

OPERATIONAL UPDATE

Further to the operational update released on 1 February 2018, Pan African is pleased to provide further information on progress at the Fairview 11-block Main Reef Complex (“MRC”) orebody and the Barberton Tailings Retreatment Plant (“BTRP”), as well as updated guidance on the commencement of production from the Elikhulu Tailings Retreatment Plant (“Elikhulu”).

Barberton Mines - Fairview 11-block MRC orebody grades

The average head grade for the Barberton Mines complex, which includes the Fairview, Sheba and Consort mines, has risen from an average of 8.7g/t during July to December 2017 to 11.5g/t which was recorded in the February 2018 production month. This 32% increase in head grade is predominantly as a result of mining high-grade ore at the 272 platform since January 2018. The latest on-reef development samples taken in the 272 platform, recorded an average grade of 99.2g/t (ranging from 2.2g/t to 1,320g/t) over a mineralised width of 3.36m along a strike length of 24m. This confirms that the high-grade areas of this mining block are now in production. This high-grade core of the 11-block MRC orebody is encapsulated within a 75m mineralised envelope with the remainder of the mineralisation retrieving an average grade of 10.5g/t.

Furthermore, face sampling of the on-reef development, taken of the mineralised 11-block MRC orebody at the 358 platform, resulted in an average grade of 45.7g/t over a mineralised width of 2m, confirming that the on-reef development has reached the high-grade section of this mining block. It is envisaged that the strike length of the MRC orebody on the 358 platform will be 75m with a high-grade core of 40m, extrapolated from the 272 platform above.

These platforms underpin Fairview’s high-grade production and mining flexibility, particularly for ore haulage, development waste disposal and improving the mining face availability for the next two years, during which development of the next platform below the 358 will be completed. Production from 11-block MRC orebody will be further enhanced with the completion of the sub-vertical shaft in two years’ time.

BTRP regrind mill construction update

The construction of the regrind mill is proceeding according to schedule with commissioning anticipated in the last week of April 2018. On commissioning of the regrind mill, production at the BTRP is expected to increase to approximately 21,000 ounces per annum.

Elikhulu construction update

Construction is progressing ahead of schedule with first gold expected in August 2018. Ramp up to full production of approximately 55,000 ounces per annum is expected to take no longer than two months, after which Elikhulu is estimated to produce gold at an all-in sustaining cost of production of below $650/oz, at the prevailing USD:ZAR exchange rate. In conjunction with the Evander Tailings Retreatment Plant, these two operations are expected to produce more than 70,000 ounces per annum.

Evander Mines labour consultation process

As previously announced on 27 February 2018, Evander Mines is currently in a consultation process with its labour in terms of section 189 of the South African Labour Relations Act, 66 of 1995. Further announcements will be made in due course.

Commenting on the operational update, Cobus Loots, CEO, stated:

“Pan African is focused on sustainable lower cost gold production from our asset portfolio. After a challenging period at Barberton Mines we have successfully dealt with the key underground challenges at Fairview’s 11-block and we are on track to re-establish BTRP’s production profile at approximately 21,000 ounces per annum. Mining over the past two months at the 272 platform and the development into the 358 platform confirms the geological continuity of Fairview’s 11-block high-grade orebody. These developments, along with progress at the BTRP and Elikhulu, provide Pan African with far greater certainty of high quality gold ounce production.”

The information contained in this announcement has not been reviewed or reported on by Pan African’s auditors and is the responsibility of the Directors of Pan African.

Johannesburg

2 March 2018