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Where do Peruvian investigations into exports by Minerales del Sur or other companies to Metalor stand right now?

To our knowledge, investigation of Minerales del Sur continues by the Peruvian authorities. However, since Metalor is not indicted in any way, we do not know further details.



Has the Peruvian public prosecutor reached out to Metalor since the seizure of 91 kilos of gold in 2018?

We have been asked to furnish information about the commercial relationship with had with Minerales del Sur and in this respect we provided all necessary documentation (agreement, invoices, proof of bank transfers, etc) in due time.



To your knowledge, was Minerales del Sur aware of the sourcing of the gold in that shipment?

The documentation associated to every shipment contained all the necessary details including the mine concession from where the material was sourced. We have no reason to believe that such information was incorrect but cannot guarantee that. The investigation will figure that out.



Is Metalor reconsidering purchases from Peru now that the government has reinforced its commitment toward formalising gold miners in Madre de Dios - which involves assuring that they comply to environmental and social standards - while clamping down on illegal miners in La Pampa?

We certainly welcome such statement but that has to be transformed into real and sustainable actions. Madre de Dios is a region from where do not take any material and we do not believe this will change, at least in the near future. However, and regarding artisanal mines, we are open to consider options but it has to be under a concerted effort by all parties involved (all governmental agencies, miners, local authorities and NGOs). So far we are not there. However, in Peru we continue to operate with industrial mines.



What is Metalor’s response to critics - including the governor of Madre de Dios - who say that the company should help miners in the formalization process and possibly support them in acquiring technology that avoids mercury pollution, rather than stopping purchases from the country?

Metalor has been very engaged in supporting the formalization process. This is the best way for the miners to get a fair price for their gold and hence improving their overall working conditions, including applying best practices that do not pollute the environment. However, Metalor cannot assume by itself this responsibility. As mentioned above, this has to be a concerted effort by all parties involved.



How much do you know about the source of gold from your direct buyers? How transparent are your sources about the origin of the gold?

See the above response about the documentation supporting every shipment.



Have you ever broken business relations with companies because they claimed to be producing more gold as mining companies than physically possible? If so, which companies?

We monitor volumes on a routine basis just to avoid situations like the one you describe. Yes, we have stopped relations due to compliance. We do not compromise values for business.



Has Metalor ever addressed concerns about the origin of gold, and perhaps lax legislation of the gold buying business, with Peruvian authorities?

Yes, at the time of engaging into the formalization process and on a regular basis since then. All responses we got over time from the different authorities in Peru (Minister of Mines, Activos Mineros, Formalization Office, Sunat), were very reassuring. However, we are disappointed because it turned out that the regulatory and enforcement framework is not robust enough.



Are you aware of any complicity amongst the major gold buyers in Madre de Dios, and whether they may trade/combine purchases amongst each other?

No. Metalor does not take any material from that region.











