Unlocking the Value of a

World Class Resource Base

February 2018

BMO Global Metals & Mining Conference

Denis Alexandrov, Chief Executive Officer

AIM: HGM

Disclaimer

Certain statements within this presentation constitute forward looking statements. Such forward looking statements involve risks and

other factors which may cause the actual results, achievements or performance of the Group to be materially different from any future

results, achievements or performance expressed or implied by such forward looking statements. Such risks and other factors include,

but are not limited to, general economic and business conditions, changes in government regulations, currency fluctuations (including

the US$/RUR rate), the gold price, the Group’s ability to recover its reserves or develop new reserves, competition, changes in

development plans and other risks.

There can be no assurance that the results and events contemplated by the forward looking statements contained in this presentation

will, in fact, occur. These forward-looking statements are correct or represent honestly held views only as at the date of delivery of this

presentation.

The Company will not undertake any obligation to release publicly any revisions to these forward looking statements to reflect events,

circumstances and unanticipated events occurring after the date of this presentation except as required by law or by regulatory

authority.

***

Total cash costs include mine site operating costs such as mining, processing, administration, royalties and production taxes, but are

exclusive of depreciation, depletion and amortisation, capital and exploration costs. Total cash costs are then divided by ounces sold

to arrive at the total cash costs of sales. This data provides additional information and is a non-GAAP measure.

In line with guidance issued by the World Gold Council, the formula used to define all-in sustaining cash costs measure commences

with total cash costs per ounce sold and then adds sustaining capital expenditures, corporate general and administrative costs, mine

site exploration and evaluation costs and environmental rehabilitation costs. This data seeks to represent the total costs of producing

gold from current operations, and therefore it does not include capital expenditures attributable to projects or mine expansions,

exploration and evaluation costs attributable to growth projects, income tax payments, interest costs or dividend payments.

2

3

Highland Gold Highlights

Russia

Kekura

Klen

Mnogovershinnoye (MNV)

Belaya Gora

Blagodatnoye

Unkurtash

Novoshirokinskoye (Novo)

Kazakhstan Taseevskoye

Sredny Golgotay

ZIF-1 Tailings

- JORC-compliant measured, indicated & inferred Mineral

Resources and proven & probable Ore Reserves of gold

and gold equivalent as of 31 December 2017.

- TCC and AISC based on H1 2017 interim accounts

Annual Production 2017: 272 koz

2016: 261 koz

Total Cash Costs US$ 509/oz

All-In Sustaining Costs US$ 674/oz

Mineral Resources (Au + Au eq) 17.2 Moz

3.0 g/t

Ore Reserves (Au + Au eq) 5.1 Moz

3.3 g/t

EBITDA (FY 2016) US$ 162 M

Khabarovsk

Cluster

Baikal

Cluster

Chukotka

Cluster

Kyrgyzstan

Baley Hub

Operating mines

Development projects

Pre-development

4

Our Strategy: Unlocking Value

Maximise

the upside potential

of operating assets

Develop

assets at the

DFS/PFS stage

into production

De-risk and

convert additional

resources

into reserves

Focus development on

regions of presence

Maintain commitment to operating safety

and protecting the environment

Kekura

Klen

Taseevskoye

Unkurtash

MNV

Belaya Gora

Novo

DFS complete. Begin construction

New PFS + additional exploration

De-water pit + confirm reserves

Find partner + move to PFS stage

New reserves

Plant upgrade +

Increase throughput

Blagodatnoye

Share Price Performance

Shareholder Structure

Corporate Overview

5

Listed on London AIM

Incorporated in Jersey in 2002

15-year track record as a public company

Shareholders include a broad range of high-quality

UK, European and N. American institutional investors

Committed to Best Practice in Corporate

Governance

Led by an experienced Board of Directors and

management team

Seven directors – executive chairman, one executive

director, and five non-executive (three independent)

Shares 325,222,098

Market Cap* US$ 656M

Enterprise Value* US$ 855M

Net Debt** US$ 199M

Net Debt/EBITDA (LTM)** 1.3x

2016 Earnings/Share US$ 0.145

* On 21 Feb 2017 ** Estimated as of 31 Dec 2017

20%

10%

53%

17%

Prosperity

Capital

Management

Board &

Management

Institutions

& Retail

Core

Shareholder

Group

63%

Free

Float

HGM Gold Price FTSE All Share Mining

HGM

50

100

150

Feb’17 May’17 Jul’17 Oct’17 Feb’18

Commitment to Dividends

6

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

0

2

4

6

8

10

12

2011 2012 2013 2014 2015 2016 H1 2017

GB

X

Dividend per share (pence) Yield (%) Total Payout (US$)

$25.7M $40.3M $26.7M $23.2M $21.9M $41.8M

- Yield based on average share price for the period

- Yield calculated for H1 2017 on annualised basis

$21M

35 36 36 45 47 50 50

63

Low Cost, High Margin Producer

7

(%)

All-In Sustaining Costs Total Cash Costs

EBIDTA Margin

(US$/oz) (US$/oz)

International Majors

Russian Peers

Figures based on company filings and street consensus estimates for FY 2017 Highland Gold figures based on H1 2017 interim results

1054 954

875 860 824 750

674 621

792

669 660 663 632 526 509

379

$291

$205 $198

$134 $129 $106

$82 $70 $67 $50 $46 $44

$29

8

Attractively Valued with Upside Remaining

10.8x

7.6x 7.4x 7.0x6.1x 5.8x 5.5x 5.5x 5.2x

4.3x 4.2x3.4x 3.3x

Figures based on company filings, street consensus estimates and share price as of 20 Feb 2018 Source: BMO

EV / 2018E EBITDA

EV / Resources

Ore Reserves (proven and probable) increased by

56% year-on-year

Average grade lowered to 3.3 g/t, reflecting lower cut-

off grades and increased ore tonnage at Novo and

Belaya Gora, plus the addition of Blagodatnoye.

Reserves added from:

– Extensive MNV near-mine exploration

– Conversion of Blagodatnoye resources to

reserves following 2016-2017 drilling programme

– New exploration and lower cut-off grade at

Belaya Gora

– Re-estimation of Novo reserves with substantial

increase in ore tonnage

– Updated reserve estimate for Kekura as part of

DFS

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Converting Resources to Reserves

31 December 2016

Ore

(tonnes)

Grade

(g/t)

Gold

oz

Proven 4 041 747 5.5 710 576

Probable 8 727 888 9.1 2 549 548

Proven + Probable 12 769 635 8.0 3 260 124

31 December 2017

Ore

(tonnes)

Grade

(g/t)

Gold

oz

Proven 15 049 783 3.5 1 697 888

Probable 33 724 397 3.1 3 402 184

Proven + Probable 48 774 180 3.3 5 100 072

Highland Gold Ore Reserves

JORC-compliant Resources and Reserves of gold and

gold equivalent as of 31 Dec 2016 and 31 Dec. 2017

3.26

5.10

31 Dec 2016 31 Dec 2017

(Moz Au)

MNV Snapshot

94.6 90.4 96.2

91.5

102.5

91.4

Production(koz)

Recovery(%)

Grade(g/t)

TCC(US$)

Khabarovsk Cluster

2.29 2.36

691

607 595

2.55

2015 2016 2017

Gold production increased by 7% in 2017

Updated MNV JORC reserve statement completed and published

in May, with Life of Mine extended to 2022 (was 2018)

Ongoing near-mine exploration programme on existing MNV

licences, focusing on areas around previously-mined ore bodies

Historic waste dumps being re-evaluated, adding over 1M tonnes

of ore with grades of ~1.1 g/t Au since 2016

Two new licences received in 2017 for greenfield sites directly

adjacent to MNV – Zamanchivaya (4.2 sq km) and

Kulibinskaya (38 sq km) – with initial exploration work underway

Exploration budget of US$ 3-5 M per year

Updated JORC reserve estimate expected in Q3 2018

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Mnogovershinnoye (MNV)

2017 Highlights

Significant Exploration Potential

TCC as of H1 2017. JORC-compliant Resources and Reserves as of 31 Dec. 2017

Opened 1991 (HGM 1999)

Life of Mine 2022

Mine Type Open pit & underground

Processing Gravity + cyanide leaching

Processing Capacity 1.4 Mtpa

Au Resources (M,I&I) 578 koz @ 7.7 g/t

Au Reserves (P&P) 453 koz @ 5.5 g/t

Au Production (2017) 103 koz

Avg Head Grade 2.55 g/t

Total Cash Costs* US$ 595/oz

61.3

75.4

45.9

71.4

43.2

72.5

Production(koz)

Recovery(%)

Grade(g/t)

TCC(US$)

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Belaya Gora

1.21 1.64

1.11

465

678

880

Opened 2014

Life of Mine* 2032

Mine Type Open pit

Processing Gravity

Processing Capacity 1.6 Mtpa

Au Resources (M,I&I)* 1.38 Moz@ 1.4 g/t

Au Reserves (P&P)* 932 koz @ 1.4 g/t

Au Production (2017) 43 koz

Avg Head Grade 1.11 g/t

Total Cash Costs US$ 880/oz

Belaya Gora Snapshot Khabarovsk Cluster

2017 operations focussed on processing low-grade ore stockpiles

in advance of expected new mining plan and processing plant

upgrades

Lower mined ore grade during the year due to the re-classification

of some waste stripping following a decision by regulators to

reduce the mine's cut-off grade from 0.7 g/t to 0.3 g/t

A pre-feasibility study was completed in early 2018, including:

– Upgrades to the processing plant, adding a carbon-in-pulp

(CIP) circuit to improve recoveries from 72% to a range of 86-

91% for Belaya Gora ore and 90% for Blagodatnoye ore

– New mining plans for Belaya Gora and Blagodatnoye (both

open pit), envisioning the processing of Blagodatnoye ore at

the Belaya Gora mill and a combined life of mine extending

until the year 2032

– Estimated capex of US$ 15M for the plant upgrade and

US$ 21M to move mining activity from Belaya Gora to

Blagodatnoye in 2023 (crushing circuit, road construction and

upgrades, and equipment replacement)

– Updated resource estimates incorporating results from 2016-

2017 drilling on the Belaya Gora northeast flank and at

Blagodatnoye, tripling gold reserves for the operation

– Average annual production of 55 koz over LoM at an average

total cash cost of US$ 802/oz and all-in sustaining costs of

US$ 848/oz

2017 Highlights

Plant Upgrade + Blagodatnoye

2015 2016 2017

TCC as of H1 2017. JORC-compliant Resources and Reserves as of 31 Dec. 2017

* with Blagodatnoye

106

86.0

118

85.9

127

85.0

Production(koz)

Recovery(%)

Grade(g/t)

TCC(US$)

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Novoshirokinskoye (Novo)

5.58 5.62

305 302 254

5.61

* Adjusted for processing costs as if producing dore.

Opened 2009

Life of Mine 2032

Mine Type Polymetallic, underground

Processing Gravity-flotation circuit

Processing Capacity 0.8 Mtpa

Au eq Resources (M,I&I) 2.87 Moz @ 3.9 g/t

Au eq Reserves (P&P) 1.71 Moz @ 3.1 g/t

Au Eq Production (2017) 127k oz

Avg Head Grade 5.61 g/t

Total Cash Costs US$ 305/oz (US$ 450/oz*)

Novo Snapshot Baikal Cluster

Novo continues to be our lowest cost, highest margin production

asset

Gold equivalent production rose by 7.7% in 2017

Updated JORC reserve audit completed in November 2017 with a

lower cut-off grade and 430% increase in ore tonnage.

– Ore reserves rose to 1.9 Moz Au Eq. (as of 31 Dec 2016) from

the previously-estimated 1.1 Moz, at an average grade of

3.3 g/t versus 9.8 g/t reported earlier and the current 5.6 g/t

average grade at the mill

To compensate for expected lower grades, the Company is in the

process of expanding Novo’s mining and milling capacity to

1.3 Mtpa

Stage 1 – upgrades to the mining complex including a skip hoist

overall, ventilation and heating systems – scheduled for

completion by year-end 2018

Stage 2 – processing plant upgrades – currently in the design

phase.

2017 Highlights

1.3 Mtpa Expansion

TCC as of H1 2017. JORC-compliant Resources and Reserves as of 31 Dec. 2017

2015 2016 2017

2017 Highlights

Kekura

Est. Start Date 2021

LoM 16 years

Mine Type Open pit & underground

Processing Gravity + cyanide leaching

Processing Capacity 0.8 Mtpa

Au Resources (M,I&I) 2.46 Moz @ 8.1 g/t

Au Reserves (P&P) 2.00 Moz @ 7.0 g/t

Au Production

(est. annual)

172k oz (years 1-8)

46k oz (years 9-16)

Total Cash Costs (est.) US$ 511/oz

Kekura Snapshot Chukotka Cluster

Mayskoye

Kupol

Klen Dvoinoye Kekura

Chukotka

Polymetal

Kinross

Valunisty

Pevek

Anadyr

2017 exploration programme of 11,000 metres of RC-drilling and 4,750 m of core drilling for reserve confirmation, as well 4,350 m of drilling to confirm sterile ground

Government approval granted for the development of a deposit of “federal significance”, a requirement for deposits of this size

Work began on a state-funded power line to connect Kekura to the regional electrical grid

DFS completed in early 2018, envisaging:

– Sequential and combined open-pit and underground operation with an estimated total mine life of 16 years, compared to eight years projected in the PFS

– Processing plant capacity of 800 ktpa with 85% recovery

– Capex of US$ 229 M (pre-commissioning, excl. underground)

– Average annual gold production of 172 koz for the first eight years of operation and 46 koz for the final eight years

– Average total cash costs of US$ 511/oz and all-in sustaining costs of US$ 541/oz

Preliminary construction work is already underway at Kekura, with the bulk of construction due to take place in 2019-2020.

Upside potential in additional targets within licence area

– 12 additional targets in the broader Kekura licence area (nearly 1500 sq km.).

– Exploration drilling in progress on the Granat ore body

Definitive Feasibility Study

Figures based on 2018 Definitive Feasibility Study 13

A scoping study for Unkurtash was completed and published in

March 2017, envisaging:

– Two open pits and an 18-year life of mine

– Processing plant utilizing gravity concentration and gravity

tailings CIL with an annual throughput of 4 million tonnes and

recoveries of over 80%

– Annual production of 133k oz of gold at an average operating

cost of US$ 616/oz

– Total capital expenditure to start production is estimated at

US$ 322 million

Highland Gold is considering partnership opportunities to develop

this promising resource and has had preliminary discussions with

potential partners

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Unkurtash

Unkurtash

Sarytube

Karatube

Baikonur 0 1000 m

Unkurtash

Kazakhstan

Kyrgyzstan

Kumtor

Bishkek

Bozymchak

Ishtamberdy

KAZ Minerals

Centerra

Full Gold Mining

China

Unkurtash Licence Area

Figures based on March 2017 Scoping Study

LoM 18 years

Mine Type Open pit

Processing Gravity + cyanide leaching

Processing Capacity 4 Mtpa

Resources (M,I&I) 3.70 Moz @ 1.7 g/t

Au Production (est. annual) 133k oz

Avg. Operating Costs (est.) US$ 616/oz

Capex Required US$ 322 M

NPV (10%) US$ 200 M

Unkurtash Snapshot Kyrgyzstan Scoping Study

The Highland Gold Investment Case

Upside Potential in Existing

Operating Assets

Growth Potential in High

Grade Deposits

Development Strategy

Focused on Regional Hubs

Disciplined Capital

Allocation

Commitment to Dividend

15-Year Track Record

as a Public Company

15

Unlocking the Value of

Highland Gold’s

Resource Base

www.highlandgold.com info@highlandgold.com +7 495 424-95-21

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