LBMA RSG Rev. 02 Independent Reasonable Assurance Report September For third-party audits based on ISAE 3000 2020 Independent Reasonable Assurance Report to PORTOVESME SRL on its Refiner’s Compliance Report 2019 for the London Bullion Market Association’s Responsible Silver Guidance To the Board of Directors of PORTOVESME SRL We were engaged by Refiner to provide reasonable assurance on its Refiner’s Compliance Report for the year ended 31 December 2019. The assurance scope consists of the Refiner’s Compliance Report. Management’s Responsibilities The Management of PORTOVESME SRL is responsible for the preparation and presentation of the Refiner’s Compliance Report in accordance with the LBMA Responsible Silver Guidance (v.1) (the “Guidance”). This responsibility includes establishing appropriate risk management and internal controls from which the reported information is derived. The criteria identified by the Management as relevant for demonstrating compliance with the Guidance are the activities described within the Refiner’s Compliance Report. Auditor’s Responsibilities Our responsibility is to carry out a reasonable assurance engagement in order to express a conclusion based on the work performed. We conducted our assurance engagement in accordance with International Standard on Assurance Engagements ISAE 3000 Assurance Engagements other than Audits or Reviews of Historical Financial Information issued by the International Auditing and Assurance Standards Board and the guidance set out in the LBMA Responsible Silver Programme - Third Party Audit Guidance for ISAE 3000 Auditors (the “Audit Guidance”). This report has been prepared for Refiner for the purpose of assisting the Management in determining whether PORTOVESME SRL has complied with the Guidance and for no other purpose. Our assurance report is made solely to PORTOVESME SRL in accordance with the terms of our engagement. We do not accept or assume responsibility to anyone other than PORTOVESME SRL for our work, or for the conclusions we have reached in the assurance report. Inherent limitations Non-financial information, such as that included in the Refiner’s Compliance Report, is subject to more inherent limitations than financial information, given the more qualitative characteristics of the subject matter and the methods used for determining such information. The methods used by Refiners to comply with the Guidance may differ. It is important to read the PORTOVESME SRL’s silver supply chain policy available on PORTOVESME SRL’s website: https://www.portovesme.it/en/about-us/Pages/Supply-Chain-Policy.aspx. 1 LBMA RSG Rev. 02 Independent Reasonable Assurance Report September For third-party audits based on ISAE 3000 2020 Independence and competency statement In conducting our engagement, we have complied with the applicable requirements of the Code of Ethics for Professional Accountants issued by the International Ethics Standards Board for Accountants, which is founded on fundamental principles of integrity, objectivity, professional competence and due care, confidentiality and professional behaviour. We confirm that we satisfy the criteria for assurance providers as set out in out in the Audit Guidance to carry out the assurance engagement. Conclusion In our opinion, the PORTOVESME SRL’s Refiner’s Compliance Report for the year ended 31 December 2019, in all material respects, describes fairly the activities undertaken during the year to demonstrate compliance, and management’s overall conclusion contained therein, is in accordance with the requirements of the LBMA Responsible Silver Guidance (v.1). Bureau Veritas Italy September 16, 2020 Milan, Italy 2 Portovesme s.r.l. Table1: Refiner’s details Company Name: Portovesme s.r.l. Entities and Location: Portovesme s.r.l. SP n. 2 Carbonia -Portoscuso km 16,5 – 09010 Portoscuso (Italy); Portovesme s.r.l. Località Pixina Linu – 09037 San Gavino Monreale (Italy); Reporting year-end: 31/12/2019 Date of Report 31/05/2020 Senior management responsible for this report Davide Garofalo Responsible Sourcing Officer Maria Vittoria Asara History Portovesme s.r.l. was established on 2nd July 1999 by the acquisition by Glencore International AG from ENI of both the production site in Portoscuso - started up in 1970 - and the site in San Gavino, started up in 1929. Portovesme s.r.l. is totally owned as subsidiary of Glencore International AG, European leader in the trading of commodities and non ferrous metals in particular. Portovesme s.r.l. is the only Italian primary producer of Zinc, Lead and Silver from raw minerals, with size aligned to the highest international producers. At the moment Portovesme s.r.l. employs 655 direct workers and about 700 external contractors people, belonging to companies which permanently work in the plant. Portovesme s.r.l. in Sardinia owns and operates two production sites and a landfill: • one site is located in Portoscuso (Carbonia-Iglesias) and produces Lead, Zinc and sulphuric acid as byproduct from raw materials and the recovery of metallurgical wastes; • the other site is located in San Gavino Monreale and is committed to the Lead refining and production of Silver and Gold; • Genna Luas landfill is located in the municipality of Iglesias – Carbonia and is devoted to the disposal of the process wastes from both sites. The following are the main production areas of the 2 manufacturing sites: WAELZ ZINC LINE ROTATORY KILNS • The rotatory Waelz kilns treat EAF dusts and residues from other PV process (water treatment sludges) • The process is a reduction of the zinc by addition of anthracite and CaO: the final product is a Waelz Oxide with 60-62 % of Zn • This oxide is sent to the SX plant without a washing step or to the L.O.W. washing plant for a further delivery to the Roaster. SX SOLVENT EXTRACTION Consists of three main sections: • Leaching section: the waelz oxide (Zn 60 %) and KSS oxide (Zn 38%) are leached to produce a ZnSO4 solution (PLS) • Solvent extraction section: the organic solvent (D2EHPA + kerosene) extracts the zinc from PLS and then exchanges metal/acidity with the solution going to the cells house; • Bleed Treatment: Cd and Cu are extracted from the inorganic circuit like cement while the SO4-- like Gypsum . LURGI ROASTER AND ACID PLANT • The traditional Electrolytic process consists in various sections: Roaster; Leaching; Cells room; Casting; • Zinc concs and washed waelz oxide are roasted in the fluid bed furnace, obtaining calcine and sulphuric gas; • SO2 gas is mixed with the gas stream from the KSS lead furnace and treated in a double catalysis plant which produces sulphuric acid ZINC LINE – CELL HOUSE • In the leaching plant the calcine (with 55-60 % of Zn) is leached through several process stages; • zinc solution is purified and sent to the cell room, and added with the stream from SX: here the Zn is extracted in cathodes via an electrolitical process; • cathodes are casted in form of SHG Zinc ingots; • Pb and Ag are recovered in the sludge residues, sent to treatment in the KSS plant LEAD LINE - KIVCET PLANT • The plant treats Lead concentrates, Pb/Ag Sulphates and battery paste in a flash smelting process; • Final production consists in decopperized Lead (95% of lead content), which is refined in San Gavino. • Copper is recovered in by products (copper matte, copper drosses) available for sale. LEAD LINE - SAN GAVINO • San Gavino refines the decopperised Lead from KSS • The refining process is a thermic liquation-alligation that produces saleable refined Lead and Lead alloys. • Silver and gold are extracted from the thermic refinery in form of rich alloys; • In the precious metal section (Leferrer and TBRC) silver is concentrated in different stages and then it is refined in electrolytic process; • Silver is casted in ingots available for sale. Portovesme has a tolling contract with Glencore. Raw materials are owned by Glencore and received by Portovesme to treat them and produce base metals, including silver. Glencore collect from raw materials suppliers all informations needed to perform the due diligence in Compliance with LBMA and OECD guidance and pass the info to Portovesme. Methodological notes Portovesme s.r.l. receives feed materials for its plants - which naturally bear precious metals – from various producers from all over the world. The purpose of the company productive process is to produce nonferrous metals such as Lead, Zinc, Silver and Gold in the highest environmental Compliance report 2019 Portovesme s.r.l. 1 Portovesme s.r.l. respect and with the highest possible extraction yields. Precious metals produced in this way are sent back to Glencore that sell them to main precious metals manufactures. Compliance report 2019 Portovesme s.r.l. 2 Portovesme s.r.l. Portovesme s.r.l. EVALUATION Table 2: Summary of activities undertaken to demonstrate. Compliance Step 1: Establish strong company management systems Compliance Statement with Requirement: We have fully complied with Step 1: Establish strong company management systems 1. Has the refiner adopted a company policy regarding due diligence for supply chains of Silver? Portovesme s.r.l. has adopted a policy and procedures regarding due diligence for the supply chain of Silver. Comments and Demonstration of Compliance: In 2019, we started formalizing our supply chain policy for Silver responsible sourced metal which is based on our Code of Conduct and ethics and compliance policy. During the reporting year, we further continued to formalize our supply chain policy for Silver which is consistent with the model set out in the Annex II of the OECD due diligence guidance. This sets out our responsibility for conducting risk based due diligence, screening and monitoring of all transactions and governance structures in place. The latest policy on responsibly – sourced metals can be found on our web site. 2. Has the refiner set up an internal management structure to support supply chain due diligence? Portovesme s.r.l. has set up an internal management structure to support supply chain due diligence: the activity analysis are compliant with the policy and procedures regarding due diligence for the supply chain of Silver.