China Gold International Resources : Annual Report 2023

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COMPANY HIGHLIGHTS

THE COMPANY

Overview

China Gold International Resources Corp. Ltd. ("China Gold International" or "The Company") and its subsidiaries (collectively referred to as the "Group") is a gold and base metal mining company incorporated in British Columbia, Canada. The Company's main business involves the operation, acquisition, development and exploration of gold and base metal mineral properties. The Company's principal mining operations are the Chang Shan Hao Gold Mine ("CSH Gold Mine" or "CSH Mine" or "CSH"), located in Inner Mongolia Autonomous Region, China and the Jiama Copper-Gold Polymetallic Mine ("Jiama Mine" or "Jiama"), located in Tibet Autonomous Region, China. China Gold International holds a 96.5% interest in the CSH Gold Mine, while its Chinese joint venture ("CJV") partner holds the remaining 3.5% interest. China Gold International began its trial gold production at the CSH Gold Mine in July 2007 and commercial production commenced on July 1, 2008. The Company acquired 100% interest in the Jiama Mine on December 1, 2010. Jiama hosts a large scale copper-gold polymetallic deposit consisting of copper, gold, molybdenum, silver, lead and zinc. The Jiama Mine commenced the commercial production of phase I and phase II in September 2010 and July 2018 respectively.

The Company is working to expand resources and reserves at its existing properties through exploration programs. The Company also has adopted a growth strategy focused on strategic acquisitions sourced from the international project pipeline of its principal shareholder China National Gold Group Co., Ltd. (formerly known as China National Gold Group Corporation) ("China National Gold") and developing potential partnerships with other senior and junior mining companies.

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MESSAGE FROM THE CHAIRMAN AND CEO

Dear shareholders and friends,

Thank you for your continued support to and interest in CGG. We hereby present to you our 2023 Annual Report.

In 2023, due to the suspension of production caused by the tailings overflow at the Guolanggou tailings pond of the Jiama Copper-Gold Polymetallic Mine, the Company's performance declined significantly year-on-year, with a total of [4.6] tonnes of gold production and [20,000] tonnes of copper production, representing the first loss since 2020. The Company is in a deep regret, and shall assume the responsibility and pressure in this regard. In 2023, the management of China Gold International turned the responsibility to shareholders and the society into a driving force. On the premise of making every effort to ensure that there is no casualties and environmental pollution caused by the overflow of the Guolanggou tailings pond, the management completed the repair and reinforcement work at the Guolanggou Tailings Dam as planned. The Phase I processing plant of the Jiama Mine has resumed production in 2023. Currently, the management team is making every effort to promote the resumption of production of the Phase II processing plant, and accelerating the construction of the Phase III tailings pond to achieve the long-term stability of high-standard operation at the Jiama Mine. In 2023, we also successfully completed the slope management of the open pit at the CSH Gold Mine to ensure its safe and stable operation. At the same time, on the basis of the breakthrough results achieved in respect of underground resource exploration and reserve increase, the CSH Gold Mine is making every effort to promote the development of underground resources, striving for a possible mine life extension of the CSH Gold Mine with new value added.

Despite the impact of the decline in performance, in 2023, the Company ensured a safe funding in the year and the subsequent period in the future by optimising operations, cost control and expanding financing channels, in order to achieve an adequate ability of risk resilience.

In 2024, we will make every effort to promote the stabilization and turnaround of China Gold International with unprecedented courage, perseverance and determination, so as to repay the expectations and trust of shareholders!

Thank you again for your understanding and support!

Junhu Tong

2 China Gold International Resources Corp. Ltd.

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BOARD OF DIRECTORS AND SENIOR MANAGEMENT

BOARD OF DIRECTORS

Executive Directors

Junhu Tong

Mr. Tong, age 61, appointed as Chairman & CEO of the Company and re-designated from Non-executive Director of the Company to Executive Director of the Company, effected October 27, 2022. He served as a Non-Executive Director of the Company from June 2020 to October 2022. From October 2018 to December 2021, he served as a Vice President of CNGHK. He currently serves as the General Manager of CNGHK since December 2021. From July 2009 through October 2018, Mr. Tong served in numerous senior executive roles with China National Gold.

Mr. Tong has had a long career in the mining industry spanning over 33 years, with extensive senior executive and board experience. Mr. Tong currently serves as the Chairman of the Closed Joint-Stock Company Rudnik ("Zapadnava-Kluchi") since October 2018.

Mr. Tong has been a Fellow authorized by the Australasian Institute of Mining & Metallurgy since December 2013 up to present. Mr. Tong holds a master's degree in Mining Engineering from Beijing Science and Technology University and a bachelor's degree in Mining Engineering from Chongqing University.

Yuanhui Fu

Mr. Fu, aged 44, is a senior geologist and has over 19 years of experience in the mining industry. Since December 2021, he has served as Chairman of Tibet Huatailong Mining Development Co., Ltd. ("Tibet Huatailong"). From 2018 to 2021, Mr. Fu served as Deputy Manager of the Mineral Resources & International Cooperation Department of CNG. From 2014 to 2018, Mr. Fu was Deputy Manager of CNG's Resource Company Ltd. and Chairman of Aoyoute Mining Ltd., Wulantaolegai Mining Ltd., Xingyuan Non-Ferrous Metal Ltd. and Daolundaba Copper Ltd.. Mr. Fu was the deputy manager of Tibet Huatailong between 2012 and 2014. Before 2012, Mr. Fu also held a key role in Strategic Development Department in CNG.

Mr. Fu holds a master's degree in geochemistry and a bachelor's degree in Resource Exploration & Engineering from the China University of Geosciences (Beijing).

Weibin Zhang

Mr. Zhang, age 60, joined Inner Mongolia Pacific Mining Co., Limited ("Inner Mongolia Pacific") in March 2018 as Chairman and General Manager. From October 2017 to March 2018, he served as Executive Director and General Manager of Changchun Gold Design Institute Co., Ltd.. From March 2014 to October 2017, Mr. Zhang served as the Principle of Changchun Gold Design Institute Co., Ltd.. From March 2011 to March 2014, he served as Vice President of China National Gold Engineering Corporation.

Starting in 1985 through March 2014, Mr. Zhang held numerous senior executive roles at the Changchun Gold Design Institute Co., Ltd. and Yunnan Gold LLC.

Mr. Zhang is a senior professional mining engineer and has over 39 years of experience in the mining industry. Mr. Zhang holds a college diploma in Mining Engineering from Shenyang Gold College.

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BOARD OF DIRECTORS AND SENIOR MANAGEMENT

Na Tian

Ms. Tian, age 43, acted as Deputy General Manager of the Audit and Legal Compliance Department of CNG since February 2021. She joined CNGHK as Legal Deputy Manager of the General Administration Office in September 2018. Since February 2012, Ms. Tian has worked in the Division of Corporate Secretary Affairs of the Company and was promoted to Deputy Director in September 2017. In July 2017, she was appointed as a director of Skyland Mining (BVI) Limited, a wholly owned subsidiary of the Company. From July 2008 to May 2011, Ms. Tian was an auditor at Ernst & Young Hua Ming LLP. In 2008, Ms. Tian passed PRC national judicial examination and obtained the Legal Professional Qualification.

Ms. Tian holds a master's degree in Law from Peking University Law School. She also holds double bachelor's degrees and majored in law and business English from Guangdong University of Foreign Studies.

Non-Executive Director

Wanming Wang

Mr. Wang, aged 57, has 36 years of experience in finance and financial administration. Currently, he is the CFO of CNGHK, before that he served as the General Manager of the financial department in CNGHK since October 2018. In the past three decades, Mr. Wang has also served as head of finance departments both at the CNG's head office and its subsidiaries with responsibilities including asset management, capital management, budgeting, accounting as well as asset securitization. Mr. Wang served as a member of the Board of Supervisors in the following companies: Tibet Huatailong since 2020, and Tibet Jia Ertong Mining Development Co. Ltd. since 2020. Mr. Wang also served as a director of the Board of Soremi Investments Ltd. since 2017, CNG Buqiuke Ltd. since 2019 and Zhongxin International Financial Leasing Co. Ltd. since 2016.

Mr. Wang is a senior accountant and holds an MBA degree from Asia International Open University.

INDEPENDENT NON-EXECUTIVE DIRECTORS

Yingbin Ian He

Mr. He, age 62, joined the Company as an Independent Non-Executive Director in May 2000. He is appointed as Chairman of the Audit Committee since October 2009 and as Lead Independent Non-Executive Director since November 2018. Mr. He's career in the mining industry has spanned nearly 40 years, with extensive senior executive and board experience. Mr. He is Director and Chairman of Vatukoula Gold Mines since 2013. From 1995 to 2006, Mr. He served as President and Director of Spur Ventures Inc. (listed on TSX Venture Exchange, now Atlantic Gold Corp. part of St Barbara Ltd). From 2003 to 2006 and from 2011 to 2016, Mr. He served as Director and General Manager of Yichang Mapleleaf Chemicals Inc., former subsidiary of Spur Ventures Inc. Mr. He has served as director of several public companies including SouthGobi Resources Ltd., dually listed on the Hong Kong Stock Exchange and the TSX Venture Exchange; Director of PT Bumi Resources Tbk, listed on the Indonesia Stock Exchange, and Director of Tri-River Ventures Inc., listed on the TSX Venture Exchange. In his early career, Mr. He worked as Senior Metallurgical Engineer with Process Research Associates (now part of Bureau Veritas) (1992 to 1995), Mineral Process Engineer (1990 and 1992) with Teck Resources, and Lecturer (1982 to 1985) with Heilongjiang Institute of Mining and Technology (now Heilongjiang University of Science and Technology).

Mr. He obtained his PhD (1994) and Master of Applied Science (1990) degrees in Mineral Process Engineering from the University of British Columbia, Canada, and Bachelor of Engineering degree (1982) from Heilongjiang Institute of Mining and Technology, China. Mr. He is a member of the Canadian Institute of Mining, Metallurgy and Petroleum and the Canadian Institute of Corporate Directors.

4 China Gold International Resources Corp. Ltd.

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BOARD OF DIRECTORS AND SENIOR MANAGEMENT

Wei Shao

Mr. Shao, age 69, is elected as an Independent Non-Executive Director as well as Chairman of the Nominating & Corporate Governance Committee since June 2019. He is a partner and the National China Service Co-Leader at Dentons Canada LLP and specializes in international business transactions focusing on China. Mr. Shao has over 30 years of extensive experience in mergers and acquisitions, corporate and project financing, cross-border counseling and general corporate and commercial transactions. Mr. Shao is actively involved in community and non-profit organizations. Prior to his legal career, Mr. Shao worked for the United Nations in New York. Mr. Shao is an interpreter accredited by the United Nationals and by the federal government of Canada.

Mr. Shao holds an LLB from the University of Toronto, BA from Xi'an Foreign Languages Institute and U.N Accreditation of Simultaneous Interpretation from the Beijing University of Foreign Studies.

Bielin Shi

Mr. Shi, age 68, is elected as an Independent Non-Executive Director as well as Chairman of the Health, Safety and Environmental Committee since June 2019. He is a leading mining executive and geologist who specializes in investment management, mining geology, geostatistics, resource estimation and optimisation, exploration and project development. Mr. Shi has over 38 years of experience as a geologist with high level experience in investment management, applied geostatistics, resource estimation and mining geology, and worldwide operational expertise in exploration and mining projects. He also has expertise with independent technical reviews, due diligence audits and expert technical reporting in compliance with the JORC Code, NI43-101 and Hong Kong Stock Exchange standards.

Mr. Shi is a Competent Person under the JORC Code and holds equivalent credentials in respect of Canadian and Hong Kong's Mineral Resources/Reserves reporting standards. Mr. Shi has published numerous papers on the application of geostatistics in resource estimation.

Mr. Shi's recent work has included investment management, audit and reviews of resources for multiple commodity mining projects.

Mr. Shi has been a Post-Doctoral Research Fellow in Geostatistics from Edith Cowan University, Western Australia from 1998 to 2000. Mr. Shi holds a PhD from the University of Melbourne since 1995 and is an AusIMM Chartered Professional since 2018.

Ruixia Han

Ms. Han, age 40, is elected as an Independent Non-Executive Director as well as Chairwoman of the Compensation and Benefit Committee since June 2019. She is the Deputy CEO and Executive Director of Mason Group Holdings Limited since 16 April 2020, and an independent Non-Executive Director of Jinchuan Group International Resource Co. Ltd (HKEX Stock Code: 2362) since 20 July 2022. Prior to joining Mason Group Holdings Limited in late 2019, Ms. Han was Head of Operations and Risk of MEC Advisory Limited, which was the sole Investment Advisor to Can-China Global Resource Fund. Ms. Han's role in MEC Advisory Limited covers investment, accounting, finance treasury and investor relationships related matters. Prior to joining MEC Advisory Limited in early 2014, Ms. Han was an Investment Manager at The Export- Import Bank of China responsible for sourcing, evaluating and negotiating investment opportunities in the banking and direct investment industry.

Ms. Han has obtained her PhD's degree of Economics (Finance), Master's degree in Applied Economics (Venture Capital) and Bachelor's degree of Economics (Finance) from Renmin University of China.

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BOARD OF DIRECTORS AND SENIOR MANAGEMENT

SENIOR MANAGEMENT

Jerry Xie

EXECUTIVE VICE PRESIDENT AND CORPORATE SECRETARY

Mr. Xie, age 63, joined the Company in March 2009 and serves as Executive Vice President and Corporate Secretary. Mr. Xie is responsible for overseeing corporate secretarial matters and managing compliance and plays an important role in business development, project evaluation, investor relations as well as public relations. Mr. Xie served as Vice President and Secretary to the Board of the Company from March 2009 to October 2009 at which time he was promoted to Executive Vice President and Corporate Secretary. After joining the Company, Mr. Xie was involved in the Company's HK IPO process, evaluation of the Company's Jiama Mine, merger and acquisitions and bond issuance, as further described below. Mr. Xie has over 33 years in experience of Engineering and Project Management in the petro-chemical and oil-sand industry and mining industry. Prior to joining the Company, Mr. Xie worked as Project Manager, Project Engineer and Senior Piping Stress Analyst for LPEC/SINOPEC, Fluor, Bantrel, Tri-Ocean and WorleyParsons Canada Ltd., resource and energy engineering companies in China and Canada, from February 1982 to March 2009.

Mr. Xie holds a Master's Degree in Mechanical Engineering from the University of Calgary in Canada, a Master's Degree in Mining Engineering from the Beijing University of Science & Technology and a diploma from the Mechanical Department of Shanghai Institute of Chemical Industry.

Zheng Wang

CHIEF FINANCIAL OFFICER

Ms. Wang, aged 52, was appointed as Chief Finance Officer on May 15, 2023. Ms. Wang joined the Company in August 2012 and has served consecutively as staff accountant and accounting manager responsible for corporate financial management. Ms. Wang has extensive experience in financial reporting, internal control and corporate financing. Prior to joining the Company, Ms. Wang worked as business analyst and accounting manager for China Minmetals Corporation and IL CPA Society.

Ms. Wang holds the title of Accredited Senior Accountant in China and is a Certified Public Accountant in the United States. Ms. Wang obtained a Master's Degree in Business Administration from the University of Wisconsin-Madison, USA and a Bachelor's degree in English from North China University of Technology.

6 China Gold International Resources Corp. Ltd.

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DIRECTORS' REPORT

The Directors are pleased to present this report and the audited consolidated financial statements of the Company for the year ended December 31, 2023 (the "Reporting Period").

PRINCIPAL ACTIVITIES AND BUSINESS REVIEW

The Company is a gold and base metal mining company incorporated under the laws of British Columbia, Canada. The Company's main business involves the operation, acquisition, development and exploration of gold and base metal properties. The principal activities of the subsidiaries are set out in Note 37 of the Financial Statements. There were no significant changes in the nature of the Company's principal activities during the year.

Further discussion and analysis of the business review as required by Schedule 5 to the Hong Kong Companies Ordinance, including a fair view of the business and a discussion of the principal risks and uncertainties facing the Company, particulars of important events affecting the Company that have occurred since the end of the financial year 2023, an indication of likely future development in the Company's business, the Company and all its subsidiaries (the "Group") environmental policies and performance, compliance with relevant laws and regulations which have a significant impact on the Company, outlook of the Company's business, and an account of the Company's relationships with its key stakeholders can be found in the "Five-Year Financial Summary", "Message From the Chairman and CEO", "Management Discussion and Analysis" and "Corporate Government Report" sections of this annual report and in the Annual Information Form (AIF).

SHARE CAPITAL

Details of the movement in the share capital of the Group during the Reporting Period are set out in Note 29 of the Financial Statements.

RESERVES

Details of the reserves available for distribution to the shareholders as at December 31, 2023 are set out in Note 39 of the Financial Statements.

RESULTS

The results of the Group as at December 31, 2023 are set out in the consolidated statement of profit or loss and other comprehensive income on page 73.

DIVIDEND

The directors do not recommend distributing a dividend to shareholders on account of its 2023 annual results.

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DIRECTORS' REPORT

DIRECTORS

The directors during the Reporting Period and up to the date of this report are as follows:

Executive Directors

Junhu Tong

Yuanhui Fu

Weibin Zhang

Na Tian

Non-Executive Director

Wanming Wang

Independent Non-Executive Directors

Yingbin Ian He

Wei Shao

Bielin Shi

Ruixia Han

In accordance with article 14.1 of the Company's articles (the "Articles"), each of the Directors shall retire at the 2024 annual and special meeting of the Company (the "2024 AGM") and, being eligible, shall offer themselves to be re-elected at the 2024 AGM.

THE BIOGRAPHY OF THE DIRECTORS AND THE SENIOR MANAGEMENT

The biographical details of the Directors and the senior management of the Company are set out in the Directors and senior management's profile from page 3 to 6 of this annual report.

DISCLOSURE OF INFORMATION OF DIRECTOR PURSUANT TO RULE 13.51B(1) OF THE HONG KONG LISTING RULES

Save as disclosed in this annual report, there are no other changes to the Directors' information as required to be disclosed pursuant to Rule 13.51B(1) of the Rules Governing the Listing of Securities on Hong Kong Stock Exchange (the "Listing Rules").

INDEPENDENCE OF THE INDEPENDENT NON-EXECUTIVE DIRECTORS

The Board has received from each of the Independent Non-Executive Directors, an annual confirmation of his independence pursuant to the factors set out in Rule 3.13 of the Listing Rules, and considers that all of the Independent Non-Executive Directors are independent.

DIRECTORS' SERVICE CONTRACTS

None of the Directors elected at the 2023 AGM has a service contract with the Company or any of its subsidiaries which is not determinable by the employing company within one year without payment of compensation, other than statutory compensation.

8 China Gold International Resources Corp. Ltd.

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DIRECTORS' REPORT

PERMITTED INDEMNITY AND INSURANCE

Pursuant to the Articles of the Company and subject to the provisions of the Business Corporations Act (British Columbia) (the "Business Corporations Act"), every Director or alternate director of the Company or its affiliates (and his or her heirs and legal personal representatives) shall be indemnified by the Company against any judgment, penalty or fine awarded or imposed in, or an amount paid in settlement of, a legal proceeding or investigative action where such person is liable by reason of him/her having been a director or alternate director of the Company and the Company must, after the final disposition of such proceeding, pay the expenses actually and reasonably incurred by such person. The Company has taken out insurance policies against the liabilities of the Directors that may arise out of corporate activities and the costs associated with defending any proceeding. The insurance coverage is reviewed on an annual basis. During the Reporting Period, no claims were made against the Directors.

DIRECTORS' INTEREST IN TRANSACTIONS, ARRANGEMENTS OR CONTRACTS

Mr. Junhu Tong, Mr. Yuanhui Fu, Mr. Weibin Zhang, Ms. Na Tian and Mr. Wanming Wang are considered to have conflicts of interest in the transactions as set out in the section headed "Connected Transactions and Continuing Connected Transactions" in this report due to their senior management positions or affiliate roles with China National Gold, the ultimate controlling shareholder of the Company. Save as disclosed in the section headed "Connected Transactions and Continuing Connected Transactions" in this report, no transactions, arrangements or contracts of significance in relation to the business of the Group to which the Company, any of its subsidiaries or the controlling shareholder of the Company was a party and in which a Director or any of his connected entity had a material interest, whether directly or indirectly, subsisted as at December 31, 2023 or at any time during the Reporting Period.

CONTRACTS OF SIGNIFICANCE WITH CONTROLLING SHAREHOLDERS

Save as disclosed under the section headed "Connected Transactions and Continuing Connected Transactions" in this report, no other material contract (not being contracts entered into in the ordinary course of business) was entered into by a member of the Group, the controlling shareholder or its subsidiaries during the Reporting Period.

DIRECTORS' INTERESTS IN COMPETING BUSINESSES

To the best knowledge of the Directors, during the Reporting Period and up to the date of this report, save for the directorships and management roles of our Directors in other mining companies, none of our Directors had any interests in businesses that compete or are likely to compete, either directly or indirectly, with the Company. Please refer to the biographies of our Directors set out under the section headed "Board of Directors and Senior Management" of this report for details of such circumstances.

DIRECTORS' AND CHIEF EXECUTIVE'S INTERESTS IN SHARES

As at December 31, 2023, the interests and short positions of the Directors and chief executive of the Company in the shares, underlying shares and debentures of the Company and its associated corporations (within the meaning of Part XV of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) ("SFO")) which were required to be notified to the Company and the Hong Kong Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which they are taken or deemed to have under such provisions of the SFO), or as recorded in the register maintained by the Company pursuant to Section 352 of the SFO or as otherwise notified to the Company and the Hong Kong Stock Exchange pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers (the "Model Code") as set out in Appendix C3 to the Listing Rules were as follows:

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DIRECTORS' REPORT

SHARES

Long position in shares

CONNECTED TRANSACTIONS AND CONTINUING CONNECTED TRANSACTIONS

China National Gold is the ultimate controlling shareholder of the Company currently holding approximately 40.01% of the issued shares of the Company and is therefore a connected person of the Company under the Listing Rules. As a result, the transactions entered into between China National Gold and the Controlled Entities as described in this section below, constitute non-exempt continuing connected transactions or partially exempt connected transactions of the Company as defined under Chapter 14A of the Listing Rules.

In addition, Tibet Huatailong, Inner Mongolia Pacific, China National Gold Group Finance Company Limited ("China Gold Finance"), and China Gold Hong Kong (together the "Controlled Entities") are ultimately controlled by China National Gold and are therefore connected persons of the Company by virtue of Rule 14A.07 of the Listing Rules.

Non-Exempt Continuing Connected Transactions

Product and Service Framework Agreement

On April 26, 2013, the Company entered into a Product and Service Framework Agreement (as subsequently amended, the "Product and Service Framework Agreement") with China National Gold for the provision of mining related services and products to the Company in order to facilitate the Group's operations in the People's Republic of China (the "PRC") for three years until June 18, 2016.

The Company entered into a First Supplemental Product and Service Framework Agreement (the "First Supplemental Product and Service Framework Agreement") on May 29, 2015 to extend the expiry date of the Product and Service Framework Agreement to December 31, 2017 and included the sale and purchase of copper concentrates produced at the Jiama Mine between the Group and China National Gold into the product and service scope of the Product and Service Framework Agreement, which were approved by the independent shareholders of the Company on June 30, 2015. Details of the First Supplemental Product and Services Framework Agreement are as stated in the Company's announcement dated June 3, 2015, circular dated May 29, 2015 and poll results announcement dated July 1, 2015.

The Company entered into a Second Supplemental Product and Services Framework Agreement (the "Second Supplemental Product and Services Framework Agreement") on May 26, 2017 to extend the term to December 31, 2020 and to extend the scope of the First Supplemental Product and Service Framework Agreement to include leasing services to be provided by Zhongxin International Financial Leasing (Shenzhen) Co. Ltd., the shares of which are 80% owned by China National Gold. Details of the Second Supplemental Product and Services Framework Agreement are as stated in the Company's announcement dated May 26, 2017, circular dated June 1, 2017 and poll results announcement dated June 30, 2017.

On May 6, 2020, the Company and China National Gold entered into the Third Supplemental Products and Services Framework Agreement (the "Third Supplemental Product and Services Framework Agreement"), pursuant to which both

10 China Gold International Resources Corp. Ltd.