Unlocking the Value of a

World Class Resource Base

March 2017

BMO Global Metals & Mining Conference

Denis Alexandrov, Chief Executive Officer

AIM: HGM.L

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 at a Glance

Kekura

Klen

Belaya Gora

Mnogovershinoye

(MNV)

Baley Hub

Novoshirokinskoye

(Novo)

Blagodatnoye

Lyubov

Khabarovsk

Cluster

Chukotka

Cluster

Baikal

Cluster

Operating Mine

PFS Stage

Scoping Study

46%

54%

2016 Production

43%

15%

20%

22%

Mineral Resources

261

koz

16.4

mmoz

---

3.4 g/tUnkurtash Kyrgyzstan

US$

444

US$

609

Total Cash Costs All-In Sustaining Costs

- JORC-compliant measured, indicated & inferred resources of gold and

gold equivalent as of 31 December 2015, adjusted for Kekura PFS.

- TCC and AISC for H1 2016

4

Our Strategy: Unlocking Value

Maximize upside potential of

operating assets

Develop existing high-grade

resources in our portfolio

Focus development on

regions of presence

Maintain commitment to operating

safety and protecting the environment

MNV

1.6 mmoz

3.4 g/t

Novo

1.5 mmoz

7/6 g/t

Belaya Gora

0.8 mmoz

2.3 g/t

Kekura

2.1 mmoz

8.6 g/t

Klen

0.6 mmoz

5.0 g/t

Lyubov

0.5 mmoz

1.3 g/t

Taseevskoye

5.1 mmoz

5.1 g/t

Unkurtash

3.7 mmoz

1.7 g/t

- JORC-compliant measured, indicated & inferred resources of gold and

gold equivalent as of 31 December 2015, adjusted for Kekura PFS.

Corporate Overview

5

Listed on London AIM

Publicly-listed company since 2002

Shareholders include a broad range of major high-

quality UK and European 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 directors

Committed to Returning Capital to

Shareholders

H1 2016 interim dividend of £0.05 per share

FY 2015 total dividends - £0.045

AIM HGM.L

Shares 325,222,098

Market Cap* US$ 767m

Enterprise Value* US$ 970m

Net Debt** US$ 198m

Net Debt/EBITDA** 1.3

H1 2016 Earnings/Share US$ 0.113

* On 20 February 2017 ** On 1 July 2016

26,6%

10,0%

46,4%

17,0%

Prosperity Capital

Management

Board &

Management

Institutions

& Retail

Primerod Int’l &

Affiliated Parties

Shareholder Structure

56%

Free

Float

6

Low Cost Producer…

984 980 965 925 904 856800 770 730 725

609 572

All-In Sustaining Costs (US$)

All figures based on most recent financial data published by company. HGML data for H1 2016.

7

…With Good Operating Margins

All figures based on most recent financial data published by company. For HGML, H1 2016.

EBITDA Margin

63

5450

46 46 45 43 40 37 36 35 33

Strong 12-Month Share Performance…

8

0,0

0,5

1,0

1,5

2,0

2,5

3,0

0

20

40

60

80

100

120

140

160

180

200

Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb

Share Price

Liquidity

(Average Daily

Trading Volume)

0

50

100

150

200

250

300

350

HGM

FTSE All Share MINING

Gold Price

GB

X

mln

GB

P

…With Upside Remaining

9

183 178 176

149 148

87

56 5440 36

19

EV/Resources

All figures based on most recent resource data published by company and share price on 20 February 2017.

171142 160

29119

140

200

2010 2016 2020

2017 Production Guidance: 255-265 koz

2020 Production Target: 500 koz

– Includes only operating mines and Kekura

– Additional upside potential with Klen, Baley Hub (Taseevskoye,

Sredy Golgotay), and Unkurtash

Delivering Growth

10

BaikalNovo

ChukotkaKekura

KhabarovskMNV

Belaya Gora

Blagodatnoye

500

200

2614.4%

CAGR

Location Khabarovsk Cluster

Opened 1991 (HGM 1999)

LoM 2021

Mine Type Open pit & underground

Processing Gravity + Cyanide Leaching

Processing Capacity 1.4 mtpa

Au Production (2016) 96,188 oz

Avg Head Grade (2016) 2.35 g/t

Total Cash Costs* US$ 602

11

Mnogovershinnoye (MNV)

* H1 2016

Oldest operating mine in our portfolio

Recently extended life of mine by three years

following broad review and regulatory approval

of reserves under Russian (GKZ) classification

New JORC reserve audit currently in progress

Key Challenge: To identify additional resources

to feed the MNV mill beyond 2021

122,3

94,6 96,291,8 90,4 91,5

722691

602

2014 2015 2016

Production (koz) Recovery (%) Grade (g/t) TCC (US$)

3.04

2.29 2.36

MNV Snapshot

Unlocking Value:

Extending life of mine

Extensive near-mine exploration focused on

upgrading existing resources and targeting

additional resources to enhance life of mine for

both underground and open-pit operations

– Over 18,000m of drilling carried out on the

lower horizons of the Northern, Southern

and Central ore zones and the Upper ore

body in 2016

– 2017 drilling programme to focus on the

Southern, Flank, Upper, and Quiet ore

zones, as well as on the MNV North-

Western Flank licence (Bear ore body).

Ongoing re-evaluation of MNV's historic rock

dumps

– Identified 758.2k tonnes of ore in 2016 at

~1 g/t

– Programme continues in 2017

12

Mnogovershinnoye (MNV)

Northern

Southern

Flank

97,8105,9

117,6

84,9 86,0 85,9

428

302248

2014 2015 2016

Production (koz) Recovery (%) Grade (g/t) TCC (US$)13

Novoshirokinskoye (Novo)

13

Location Baikal Cluster

Opened 2009

LoM 2029

Mine Type Underground

Processing Gravity-flotation circuit

Processing Capacity 0.8 mtpa

Au Production (2016) 117,577 oz gold equivalent

Avg Head Grade (2016) 5.62 g/t

Total Cash Costs* US$ 248

* H1 2016

Polymetallic mine – gold, silver, lead, and zinc

Produces lead and zinc concentrates

Outside Processing Costs of 178 US$/oz*

Highest contributor to EBITDA

45% of production, 55% of EBITDA*

Key Challenge: Increase throughput to offset

expected decline in average grade

Novo Snapshot

6.20

5.58 5.62

Unlocking Value:

Expanding mine capacity

Russian-standard (GKZ) reserves re-

estimation resulted in a 77% increase in ore

volumes and 36% decrease in average grade

(to 5.13 g/t), with total gold equivalents rising

by 13% to 85.7 tonnes (2.6 mln oz)

– New JORC reserve statement in Q2

Larger ore volume at lower grades justified

boosting mill capacity from 700 ktpa to 1.3

mtpa.

Underground expansion underway in order to

gain access to new horizons

Engineering and design documentation,

preparations for construction work, and

selection of contractors all underway.

Novo is expected to achieve its new target

production capacity in late 2018, boosting Au

equivalent output by ~40%

14

Novoshirokinskoye (Novo)

Ore body outlines before reserve re-estimation

Ore body outlines after reserve re-estimation

38,8

61,3

45,9

61,775,4 71,4

926

465

613

2014 2015 2016

Production (koz) Recovery (%) Grade (g/t) TCC (US$)15

Belaya Gora

1515

Location Khabarovsk Cluster

Opened 2014

LoM 2023

Mine Type Open pit

Processing Gravity-flotation circuit

Processing Capacity 1.8 mtpa

Au Production (2016) 45,909 oz

Avg Head Grade (2016) 1.21 g/t

Total Cash Costs* US$ 613

* H1 2016

Youngest operating mine, developed fromgreenfield

Mining currently focused on stockpiles due toongoing operational reassessment

Key Challenges

– Dilution and irregular grade distribution

– Unstable mill operation and recovery

Belaya Gora Snapshot

1.58 1.641.21

Unlocking Value:

Upgrading mill to improve recovery

+ adding new resources

Successful programme to stabilise mill input rate

in 2016 resulted in lower tailings grade

Currently working with SRK on designs for adding

cyanide leach (CIL) capacity to further boost

recovery to 90% or more

3,000 metres of drilling in 2016 for reserve

confirmation and improved mine planning

A new JORC-compliant reserve statement is

expected by April

Targeted for adding resources to Belaya Gora

Preliminarily-measured С2 category reserves for

open pit mining of about 10 million tonnes of ore.

Initial metallurgical testwork supports gold

recovery of over 90% via cyanidation.

15,000 metres of drilling in 2016 to confirm

reserves

– JORC-compliant reserves statement by April16

Belaya Gora & Blagodatnoye

Belaya Gora

Blagodatnoye

MNV

30 km

Blagodatnoye

17

Kekura – a World-Class Project…

Location Chukotka Cluster

Start Date 2019

LoM 2029

Mine Type Open pit & underground

Processing Gravity + Cyanide Leaching

Processing Capacity 0.8 mtpa

Au Production (est. annual) 209,000 oz

Reserve Grade 10.73 g/t

Kekura Snapshot

1.58 1.641.21

Kekura Mineral Resources*

ClassificationTonnage

(Mt)

Au Grade

(g/t)

Metal Au

(Moz)

Indicated 7.412 8.64 2.06

Inferred 3.266 4.80 0.51

Total 10.678 7.47 2.57

Kekura Ore Reserves*

ClassificationTonnage

[Mt]

Au Grade

[g/t]

Metal Au

[Moz]

Proven - - -

Probable Open Pit 4.296 10.94 1.51

Underground 0.541 9.04 0.16

Total 4.837 10.73 1.67

* Reserves & resources compliant to JORC Code 2012. Resources cut-off grade of 1.0

g/t Au. Reserves cut-off grade of 2.2 g/t Au at the open pit and 4.2 g/t Au for the

underground mine. A gold price of US$1,150 per troy ounce has been applied.

Highland Gold’s premier development project

Licence Area: 1,497 sq km

High grade, open pit and underground mining

and favourable metallurgy to make Kekura a

low cost operation

25,000 m exploration drilling program

completed in 2016

Drilling focused on the eastern flank of the

deposit with the aim of resource confirming

and potentially adding reserves for

underground mining.

11 prospects have been identified within the

Kekura licence area as warranting further

prospecting work

18

…with Great Upside Potential

1 – Zabytiy

2 – Granat

3 – Ryzhiy

4 – Iris

5 – Bond

6 – Zakol

7 – Gonch

8 – Zapadny 2

9 – Zapadny 1

10 – Iris (detailed)

11 – Alpinist

Kekura Deposit

Western site

Central site

Eastern site

Kekura

Exploration Grid

Site Drill holes grid Reserves, %

Western 20х25m 37.7

Central 20х50m 43.3

Eastern 80х100m 19.0

Fluor Canada developing definitive feasibility study (DFS)

SRK drafting the mining section of the DFS.

The process is expected to continue in Q1 2017, during

which Fluor will consolidate the various sections of the

DFS into a single report.

Preparations for 2017 construction and installation

ongoing, including the procurement of construction

materials and working with contractors for construction of

key infrastructure facilities.

A winter road to the site has already been built, the first

shipment of diesel fuel has been delivered to site, and key

commodity supplies from Pevek and Magadan are

expected in February-March 2017.

Fluor is also involved in the process of issuing and

approving purchase orders for the main processing plant

equipment.

– Quotes have already been received for milling and

crushing equipment, power generators and press

filters.

19

Kekura Project Status

Key Project Parameters*

Unit Total

Post-Tax IRR % 38

Post-Tax NPV (5%) US$ m 357

Milling Capacity ktpa 800

Average Annual

Production (LoM)k oz 209

Capital Cost Estimate US$ m 188

Payback Period Years 3

Life of Mine Years 8

* A gold price of US$1,150 per troy ounce has been applied. Project

parameters based on 2016 PFS, without historical costs.

Three deposits in close proximity

– Taseevskoye

– Sredny Golgotay

– Baley ZIF-1 Tailings

Brownfield sites, substantially explored

Several scenarios being studied for joint

development of Baley Hub licenses

Deposit being evaluated for providing additional

resources for Novo mill or stand-alone operation

2016 pilot mining programme at the Kaftan site

– 15k tonnes of ore at 3.22 g/t for treatment at

Novo, adding 1,315 oz Au to total production

7,000m of grade control drilling on Kaftan in 2016

16,000 m and 2,000 m of trenching completed last

year to validate state-registered reserves across

the Sredny Golgotay licence

Baley ZIF-1 tailings being assessed for potential

to improve economics of Sredny Golgotay

development, including possible heap leach

20

Baley Hub Projects

Bulkhead Structure

Taseeevskoye

Sredny Golgotay

ZIF-1 Tailings

Baley Pit

Town of

Baley

ZIF-2 Tailings

2kmSource: Google

Sredny Golgotay

Baley Hub Projects

Major resources of 5.1 mmoz at 5.1 g/t

Refractory ore

Previously mined both open pit and

underground in mid-20th century

Currently de-risking the project by pumping

water out of the Taseevskoye pit and monitoring

inflow from the Baley pit.

– Three pumps are up and running, current

daily volume is 21.6k m3

– 3.3M m3 pumped out in in H2 2016 and

January 2017

– 5.7m decrease in water level

– No water inflow from Baley pit detected at

the present water levels

– De-watering programme to continue

throughout 2017

After de-watering the pit, a drilling programme

will be implemented to confirm reserves

21

Baley Open Pit Taseevskoye Open Pit

Taseevskoye

567

568

569

570

571

572

573

574

AS

L,

m

Water Level Change in Pits

Тасеевский БалейскийBaleyTaseevskoye

Jul Aug Sep Oct Nov Dec Jan

New PFS currently being developed by Hatch

Preliminary estimates show favorable

economics

Full results expected by Q2 2017

JORC-compliant resource (Indicated &

Inferred) of 0.63 Moz with 5.04 g/t average

grade, open pit

Plans initiated to draft a PFS for the project

with a revision of CAPEX and OPEX including

optimisation of processing solutions for the

proposed mill

Potential capacity of 350 ktpa at over 90%

recovery

Outside contractor for a resource verification

project in the second half of last year.

4,200 m3 of trenching and 96 metres of

exploratory drilling

A total of 5,680 tonnes of ore mined and

treated, yielding 170 oz of gold.

63 km² licence zone with four distinct

prospects, three of which – Unkurtash,

Sarytube and Karatube – have been the focus

of extensive exploration activity

JORC compliant resource audit in 2013

defines combined 3.7 Moz at ore grade of 1.7

g/t (82% Measured and Indicated) for the three

prospects

Scoping study underway by SRK with

completion expected in Q1 2017

22

Development Pipeline

Klen Unkurtash

LyubovUnkurtash

Sarytube

Karatube

Baikonur0 1000 m

0

20

40

60

80

100

120

2014 2015 2016 2017

MNV

Belaya Gora

Novo

Kekura

Other

23

Capital Expenditure

2017 capex to be funded largely through cash flow

Low-cost debt available for additional funding

Debt Status

Total debt decreased by US$ 38 m

in H1 2016

Effective interest rate as of

01.07.2016 – 5.1% p.a.

(was 5.43% on 01.01.2016)

Average tenor – 23 months.

45%

34%

21%Novo; $97,5m

Belaya Gora; $72m

MNV; $46m55%

23%

16%

6%

Gazprombank; $118m

UniCredit; $50m

Alfa bank; $35m

Sberbank; $12,5m

303

254

216247

229198

0

100

200

300

01.01.2015 01.01.2016 01.07.2016

Net Debt / EBITDA ratio = 1.3

as of 01.07.2016

Debt by Division Debt by Lender

Gross Debt (m US$) Net Debt

24

Commitment to Dividends

25

0,0%

1,0%

2,0%

3,0%

4,0%

5,0%

6,0%

7,0%

8,0%

9,0%

0

1

2

3

4

5

6

7

8

9

2011 2012 2013 2014 2015 H1 2016

GB

X

Dividend per share (pence) Yield (%)

PFS

MNV

Novo

Belaya Gora

Blagodatnoye

26

Upcoming Milestones for 2017

Updated JORC Reserves

Unkurtash

Baley Hub

Scoping Study

MNV

Novo

Belaya Gora + Blagodatnoye

Kekura

DFS

27

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

Unlocking the

Value of

Highland Gold’s

Resource Base

Commitment to Dividend

0Thank You

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