AFRICAN PIONEER PLC

ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

(Company no 008591V)

AFRICAN PIONEER PLC

CONTENTS:

PAGE

Company Information 2

Key Highlights 3

Chairman’s Statement 3

Board of Directors and Senior Management 5

Financial, Corporate and Operational Review

Directors’ Report 16

Directors’ Remuneration Report 19

Corporate Governance Report

Strategic Report

Statement of Directors’ Responsibilities 34

Independent Auditor’s Report 35

Consolidated Statement of Comprehensive Income 41

Consolidated Statement of Financial Position 42

Consolidated Statement of Changes in Equity 43

Consolidated Statement of Cash Flows 44

Company Statement of Financial Position 45

Company Statement of Changes in Equity 46

Company Statement of Cash Flows 47

Notes to the Financial Statements 48-66

AFRICAN PIONEER PLC

COMPANY INFORMATION

DIRECTORS

C Bird (Chairman)

R Samtani (Finance Director)

C Cordier (Business Development Director)

K Thygesen (Independent Non-Executive Director)

J Cunningham-Davis (Non-Executive Director)

BANKERS

Standard Bank

Standard Bank House

One Circular Road

Douglas, Isle of Man

IM1 1SB

SECRETARY

Cavendish Secretaries Limited

SOLICITORS (Isle of Man law)

Simcocks LLP

Ridgeway House,

Ridgeway Street,

Douglas, Isle of Man

IM99 1PY

REGISTERED OFFICE

19-21 Circular

Douglas

Isle of Man

IM1 1AF

SOLICITORS (English law)

Collyer Bristow LLP

140 Brompton Road,

Knightsbridge,

London SW3 1HY, England

FINANCIAL ADVISER

Beaumont Cornish Limited

Building 3,

566 Chiswick High Road,

London W4 5YE, England

REGISTERED AGENT

Cavendish Trust Company Limited

19-21 Circular

Douglas, Isle of Man

IM1 1AF

REGISTERED NUMBER

008591V

AUDITORS

Shipleys LLP

10 Orange Street

London

WC2H 7DQ

AFRICAN PIONEER PLC

KEY HIGHLIGHTS

• Consolidated Net assets – £ 5,238,820 (2021 restated – £ 5,941,948)

• Consolidated (Loss)/Profit - Loss – £ (670,871) (2021 - Profit restated – £273,471)

• The Group reports its results and raises funds in Pounds Sterling (GBP).

• Its primary assets are in Namibia, Botswana and Zambia

CHAIRMAN’ STATEMENT

Dear Shareholder,

African Pioneer has continued to make good progress during the period under review.

The Company has the benefit of major mining company shareholders and joint venture partners and/or option partners and

is involved in two large exploration projects in Northwest Zambia and Botswana.

In Zambia the company has granted an option with First Quantum Minerals Ltd (“First Quantum”) over its North-western

exploration projects and in Botswana the Company has granted Sandfire Resources Limited (“Sandfire”) an option over a

number of its Kalahari Copperbelt projects, whilst retaining some licences for its own exploration activities.

In Namibia the Company has a significant exploration project, which during the year was granted a mining licence and plans

are underway to bring this licence to account and commence mining activities.

During the year we carried out a drilling exercise on the Ongombo licence and had some considerable success in identifying

near surface material, which will allow the company to consider when mine planning, a 2-3 year mine life open pit, which

will facilitate entry into the proposed underground mine. During the period under review and post the reporting period, we

have been re-evaluating the ore resource at Ongombo and anticipate reporting an updated resource in Q2 2023, which takes

into consideration the contribution of the gold, which is in association with copper and the recently drilled out open pit

resource.

We are confident that our final resource model will lead to a meaningful mining situation with initial open pit and less

complicated mining approach.

In Zambia, during the option period, First Quantum have reported considerable success with their initial fieldwork and

drilling programmes. Their work has covered all aspects of exploration, including deep holes. The outcome has shown the

project to be extremely high in potential with First Quantum stating their believe that the orebody style resembles that of the

Kamoa-Kakula mine in the nearby Congo and the Western Foreland style mineralisation associated with Kamoa. This

represents a potential significant major discovery for Zambia, First Quantum and of course, African Pioneer.

Apart from the deeper style Kamoa-Kakula mineralisation, there has been near surface mineral discoveries with indication

of grades somewhat higher than traditional Copperbelt. This mineralisation is again, considered to be similar to Kolwezi

mineralisation, which supported major high-grade mining in the DRC.

We are extremely excited about the prospects of our licences and look forward to a year of more intensive exploration and

therefore more definition of overall potential.

The Botswana joint venture with Sandfire continues satisfactorily and our own exploration, which intercepted the sought

after lithology has been reinterpreted and we are excited about the prospects and the regions yet to be tested. The Kalahari

AFRICAN PIONEER PLC

Copperbelt has been the region of much interest over the last 18 months, with old theories and models being challenged by

new discoveries and drilling results.

Most of this new work adds value to our positions and reinforces our believe that one or more licences have the potential to

enhance considerable shareholder value to the African Pioneer holders.

Despite considerable headwinds the copper price stayed strong throughout the period, with forecast for the coming years,

ranging from USD10-USD15,000 per tonne.

We believe the crunch time for the supply side for copper will begin during mid ‘24 and continue through mid ‘25 and

beyond. This will make all junior mining companies who have good copper resources in reliable jurisdictions, targets for

acquisitions for by major mining companies, traders and others.

We are confident that African Pioneer has an excellent copper resource base and is well positioned for such corporate activity.

I thank my fellow directors and management for their efforts during the period under review and beyond and we all continue

to live in anticipation of small company renaissance, which is inevitable but long awaited.

Yours sincerely,

Colin Bird, Chairman

African Pioneer Plc

28 April 2023

AFRICAN PIONEER PLC

BOARD OF DIRECTORS AND SENIOR MANAGEMENT

Colin Bird - Executive Chairman

Colin is a chartered mining engineer and a Fellow of the Institute of Materials, Minerals and Mining with more than 40

years’ experience in resource operations management, corporate management, and finance. Colin has multi commodity

mine management experience in Africa, Spain, Latin America and the Middle East. He has been the prime mover in a

number of public company listings in the UK, Canada and South Africa. His most notable achievement was founding

Kiwara Resources Plc and selling its prime asset, a copper property in Northern Zambia, to First Quantum Minerals for

US$260 million in November 2009.

Raju Samtani - Finance Director

Raju is currently finance director of Tiger Royalties and Investments Plc, listed on AIM. His previous experience includes

three years as Group Financial Controller at marketing services agency WTS Group Limited, where he was appointed by the

Virgin Group to oversee their investment in the WTS Group Ltd. More recently he was finance director of Kiwara Plc which

was acquired by First Quantum Minerals Ltd in January 2010. Over the last few years, he has been involved in senior

managerial positions for several AIM/Johannesburg Stock Exchange listed companies predominantly in the resource sector

and has also been involved in FCA compliance work within the investment business sector.

Christian Cordier - Business Development Director

Christian has had considerable involvement in corporate finance and investments in both public and private mining and

exploration companies for over 22 years. His portfolio includes joint ventures with major international mining houses,

investments in listed companies in the United Kingdom, Australia and Southern Africa as well as private mining operations.

He has extensive experience in sourcing natural resource projects and nurturing them through the value curve by packaging

and arranging venture funding, managing the permitting and exploration process, negotiating off-take agreements and the

formation of a strong management team. He worked as CFO and senior accountant as well as company secretary for private

and public companies and is a member of SA Institute for Professional Accountants (“SAIPA”). Christian has done

transactions in Coal, Platinum Group Metals, Chrome, Copper, Potash, Phosphates, Diamonds, Gold, Lithium and

Manganese. Christian focuses on business development and wealth creation for private and publicly listed companies in the

mining and exploration sector.

Kjeld Thygesen - Independent Non-Executive Director

Kjeld Thygesen is mining investment veteran of more than 45 years. After being a mining analyst at James Capel in the latter

half of the 1970’s he was manager of the commodities department at Rothschild Asset Management between 1980-89. In

1990 he formed Lion Resource Advisors as a specialist adviser in the mining and natural resource sectors. LRA was the

advisor to the Midas Fund in the US between 1992 - 2000, which was one of the top performing finds during that period.

From 2002-2008 he was Investment director of Resources Investment Trust, a London listed investment trust which returned

a threefold investment during that period. He has served on several mining company boards over the past twenty years.

James Cunningham-Davis - Non-Executive Director

James Cunningham-Davis is a qualified Solicitor and a Fellow of the Chartered Institute for Securities & Investment, founder

of the law firm Buckingham Legal and founder and Managing Director of Cavendish Trust Company Ltd, and Cavendish

Secretaries Limited, all of which are headquartered in the Isle of Man. Cavendish Trust and Cavendish Secretaries provide

professional services to many private companies and various listed companies, across a number of sectors of industry and

finance in many jurisdictions, though particularly in the Natural Resources/Mining, Technology and Property sectors. James

has worked within the international legal and corporate finance/service sectors for more than 25 years and has held many

directorships in both private and listed companies.

AFRICAN PIONEER PLC

FINANCIAL CORPORATE AND OPERATIONAL REVIEW

INTRODUCTION

African Pioneer Plc a company engaging in development of natural resources exploration projects in Sub-Saharan

Africa presents its year-end results for the year ended 31 December 2022.

The Directors are required to provide a year-end report in accordance with the Financial Conduct Authorities ("FCA")

Disclosure Guidance and Transparency Rules ("DTR"). The Directors consider this Financial, Corporate and Operational

Review along with the Chairman’s Report, the Strategic Review and the Director’s Report provides details of the important

events which have occurred during the period and their impact on the financial statements as well as the outlook for the

Company going forward.

The Company’s short to medium term strategic objectives are to enhance the value of its mineral resource Projects through

exploration and technical studies conducted by the Company or through joint venture or other arrangements (such as the

Option Agreement of selected Botswanan Projects with Sandfire Resources and also the more recent the option agreement

with First Quantum on its 4 North-West Zambian licences) with a view to establishing the Projects can be economically

mined for profit. With a positive global outlook for both base and precious metals, the Directors believe that the Projects

provide a base from which the Company will seek to add significant value through the application of structured and

disciplined exploration.

FINANCIAL REVIEW

Financial highlights:

• Consolidated (Loss)/Profit Loss: £671k £loss after tax (2021: £273k - profit)

• Approximately £72k cash at bank at the period end (2021: £1.19m).

• The basic and diluted profit (losses) per share are summarised in the table below

Profit (Loss) per share

(pence)

2022

2021

restated

Basic

Note 6

( 0.35)p

0.24p

Diluted

Note 6

(0.29)p

0..20p

• Net asset value as at 31 December 2022 was £5.36m (31 December 2021 £6.06m)

Fundraisings:

The Company did not undertake any fundraisings during the period as it had sufficient working capital from the funds raised

in 2021 at Admission and the option payment received from Sandfire Resources Limited in relation to certain of the Botswana

Projects.

CORPORATE REVIEW

Company Board: The Board of the Company comprises Colin Bird, Executive Chairman Raju Samtani, Finance Director

Christian Cordier, Business Development Director Kjeld Thygesen, Independent Non-executive Director James Nicholas

Cunningham-Davis, Non-executive Director.

AFRICAN PIONEER PLC

FINANCIAL CORPORATE AND OPERATIONAL REVIEW (continued)

Listing: The Company was admitted to the Official List (Standard Segment) and commenced trading on the Main Market

for listed securities of the London Stock Exchange on 1 June 2021 (the “Listing” or “IPO”).

Corporate Transactions: On 19 January 2022, the Company and its 80% owned subsidiary African Pioneer Zambia Ltd

(“African Pioneer Zambia”) entered into an option agreement with First Quantum Minerals Ltd (“First Quantum”) (listed

on the Toronto Stock Exchange) in relation to 4 of the 5 Zambian exploration licences held by African Pioneer Zambia (the

“Option Agreement”).

Highlights of Option Agreement:

• The four exploration licences the subject of the Option Agreement are in the highly prospective Central Africa

Copperbelt in northwest Zambia which is the largest and most prolific mineralized sediment- hosted copper province

in the world and are located less than 100km from First Quantum’s giant Sentinel copper mine.

• The exploration licenses include geological formations similar in age and rock type to that hosting the major copper

deposits of the Copperbelt

• During the initial 18-month option period First Quantum has the right but not the obligation to spend US500,000 on

each of the exploration licences 27767-HQ-LEL, 27768-HQ-LEL, 27770-HQ-LEL, and 27771-HQ-LEL (the

“Zambian Projects”). At this stage First Quantum will not have earned any shares in African Pioneer Zambia, just

the right to proceed to take one or more of the properties into the First Earn In Period by issuing an Option Exercise

Notice.

• During the First Earn In Period, First Quantum then has 2 years when it has the right but not the obligation to prepare

a Technical Report in respect of the Zambian Projects demonstrating an Indicated Mineral Resource of at least

300,000 tonnes of contained copper (the “Technical Report Requirement”). First Quantum is to fund the Technical

Report. Once the Technical Report is issued First Quantum has the right to be issued shares equal to a 51%

shareholding in African Pioneer Zambia. This will also trigger the Second Earn-In Period.

• In the Second Earn-In Period First Quantum shall have the right but not the obligation to complete all necessary

mining, metallurgical and development studies to establish a mine at the Property and make a public announcement

that it intends to proceed towards commercial development of a Mine on the Property (a “Decision to Mine”). First

Quantum is to fund all costs related to the Decision to Mine. Once First Quantum announces a Decision to Mine

First Quantum has the right to be issued shares in African Pioneer Zambia to increase their 51% shareholding in

African Pioneer Zambia to 75%.

Additional Information

First Quantum: is one of the world’s top 10 copper producers operating in several countries including Zambia where it

owns the Sentinel and Kansanshi mines in North West Zambia and is known for its specialist technical engineering

construction and operational skills which have allowed it to develop and successfully run complex mines and processing

plants. Colin Bird, the chairman of African Pioneer, was a founder of and floated Kiwara Plc in around 2008 which

discovered copper in northwest Zambia and was sold to First Quantum in 2009 for U$260 million. First Quantum then

developed the Kiwara Plc projects into the Sentinel mine which is the world’s 14

largest copper mine.

Zambian Projects: The licence package covers part of the north-western extension of the Zambian Copperbelt. The

properties are located within 80-100km of First Quantum’s giant Sentinel copper mine, one of the largest copper mines in

Africa, with a reported Measured and Indicated Resources of 891Mt @ 0.45% Cu. They also lie close to the Enterprise nickel

deposit (37.7Mt @ 1.03% Ni) which is being reportedly moved towards development.

AFRICAN PIONEER PLC

FINANCIAL CORPORATE AND OPERATIONAL REVIEW (continued)

The Zambian Projects lie on the Lufilian Fold Belt in the Domes region of the Central African Copperbelt, straddling the

western boundary of the Kabompo Dome, underlain principally by rocks of the Lower and Upper Roan, as well as the

stratigraphically higher Kundelungu and Nguba Groups. This geological package is similar in age and rock type to that

hosting the major copper deposits of the Copperbelt, including Sentinel. Therefore, the licence areas are considered to be

strongly prospective for Copperbelt-type copper/cobalt and/or nickel deposits. They are historically underexplored,

representing the westerly extension of the Copperbelt which has not been investigated in detail, as previous work focussed

primarily on the central part of the zone.

On the Luamata South licence (27771-HQ-LEL), African Pioneer has acquired a valuable exploration package arising from

recent work by MMG Zambia Ltd (‘MMG’) which highlights strong soil/airborne magnetic targets that were not drill tested,

as MMG pulled out of Zambia. The Samuteba East licence (27770-HQ-LEL) was recently held by Anglo American which

also carried out airborne magnetic surveying and reconnaissance soil sampling before exiting the Copperbelt. The soil data

highlights several copper anomalies of considerable interest.

Exploration licence 27769-HQ-LEL owned by African Pioneer Zambia which is not covered by the Option Agreement is in

the Zambezi area located within the Zambezi belt of southern Zambia that hosts a Lower Katanga supergroups succession

will be transferred from African Pioneer Zambia to a new Zambian company to be owned 80% by the Company and 20% by

its local partners.

OPERATIONAL REVIEW

The Company completed an Initial Public Offering (IPO) on the Standard List of the London Stock Exchange and the

acquisition of its projects in Namibia, Zambia and Botswana in 2021 and in 2022 granted an option to First Quantum in

relation to 4 of the 5 Zambian exploration licences held by African Pioneer Zambia more details of which are provided in

the Corporate Highlights section of this review.

Technical review of Projects: After the IPO and having acquired its projects in Namibia, Zambia and Botswana, the

Company commenced technical reviews and / or programmes on its the projects located in Namibia and Zambia. The primary

metal in all countries is copper with by-product potential in all of our projects. In Zambia we have potential for cobalt, in

Botswana for silver and in Namibia for gold.

NAMIBIA:

The Company has a 85% interest in the Namibian Projects and on 20 December 2021 announced a 3.76 Mt increase in the

Measured & Indicated Mineral Resources of the Ongombo Project Mineral Resources to 10.47Mt @ 1.4% Cu, 7g/t Ag at a

cut-off of 1.0% Cu, with 0.35g/t Au categorised as Inferred following a JORC (2012) compliant review by external

consultant, Red Bush Analytics, the submission of a mine application and a positive scoping study by Practara Consulting.

On 24 May 2022, a shallow diamond drilling programme commenced on the Ongombo Project, Namibia and on 29

September 2022 the Company announced

Highlights:

• A Mining Licence has been approved by the Ministry of Mines and Energy of Namibia

• The Company is in the process of completing an Environmental and Social Impact Assessment (“ESIA”) which will

trigger the start of the mine development process

AFRICAN PIONEER PLC

FINANCIAL CORPORATE AND OPERATIONAL REVIEW (continued)

• The completed drill programme is targeting potential near-surface copper – gold mineralisation not included in the

existing underground mineral resource estimate. 26 holes completed to date with copper – gold mineralisation present

in 25 holes

• Peak assay intercepts from near-surface drilling include 5.39% Cu eq over 0.82m, 4.72% Cu eq over 1.15m, 3.96%

Cu eq over 1.15m, 3.24% Cu eq over 0.945m, 2.64% Cu eq over 1.39m and 2.46% Cu eq over 1.42m

• A zone of near-surface copper mineralisation extending over an area of approximately 750 metres by 185 metres at

an average grade of greater than 1% Cu

• A coincident gold zone covering an area of 500 metres strike length and a variable width of between 50 metres and

185 metres at an average gold grade of greater than 0.4g/t Au

• External resource consultant to undertake a mineral resource estimate for near-surface mineralisation once all assay

data has been received.

Update on the Near-Surface Mineralisation & Drill Programme

A zone of presumed mineralisation extending approximately 180m from the outcropping gossan that identifies the Ongombo

orebody at surface down-dip has been drilled. Historic low-density drilling failed to define any mineralisation and it was

assumed that as the orebody progressed up-dip towards the gossan outcrop that sulphide mineralisation in the form of pyrite

and chalcopyrite would give way to oxides of copper. Recent drilling has broadly defined a zone of predominantly copper

sulphide mineralisation to depths of around 10 to 15m vertical depth.

On completion of the balance of drilling and the receipt of outstanding assays, a mineral resource estimate will be generated

by external consultants that is expected to add to the existing underground resource and generate a new open pittable mineral

resource. Open pit excavation will potentially reduce the amount of primary underground development required to access

underground ore by stripping waste rock to expose the mineralised horizon and ultimately leaving a highwall that can be

used to develop a portal for the planned decline. Work will be done to optimise the open pit resource to generate a mineable

resource sufficient to feed a plant for a minimum of 12 months whilst primary development advances to access underground

ore.

Further studies are required to confirm the amenability of Ongombo ore to both standard flotation processing and gravity and

XRT pre-concentration methods. Provisional assessment indicates that the ore is typical of that found on this part of the

Matchless Belt and therefore suitable for recovery of copper and gold through a variety of recovery methods.

Table 1: Ongombo Near-surface Drill Programme Selected Average Weighted Assay Results for First 26 Drillholes

Borehole ID

From

(m)

Mineralised

Width

(m)

Grade

(% Cu)

Grade

(g/t Au)

Grade

(Cu

eq)*

APD001

11.81

14.81

3.0

0.42

0.78

0.96

APD002

21.25

22.2

0.945

2.42

1.19

3.24

APD003

8.82

10.37

1.55

2.18

0.50

3.0

APD004

20.5

21.5

1.0

0.75

0.27

0.94

APD005

11.69

13.11

1.42

2.12

0.49

2.46

APD006

36.63

38.04

1.41

0.73

0.15

0.83

APD007

50.42

51.42

1.0

0.47

0.14

0.56

APD008

50.58

51.73

1.15

2.95

1.47

3.96

APD009

30.41

31.80

1.39

2.36

0.41

2.64

APD010

7.9

9.0

1.1

0.11

0.66

0.56

AFRICAN PIONEER PLC

FINANCIAL CORPORATE AND OPERATIONAL REVIEW (continued)

APD011

16.7

17.48

0.78

0.69

0.17

0.80

APD012

33.26

34.05

0.785

1.11

0.21

1.25

APD013

46.04

47.2

1.15

4.44

0.40

4.72

APD014

66.74

68.79

2.05

0.60

0.14

0.70

APD015

39.14

39.82

0.68

1.03

0.19

1.16

APD016

25.88

27.25

1.37

0.98

0.31

1.19

APD017

16.0

16.57

0.57

1.33

0.33

1.56

APD018

No Mineralised Intercept

APD019

27.33

28.56

1.23

1.48

0.26

1.65

APD020

53.9

54.72

0.82

4.59

1.17

5.39

APD021

41.27

43.0

1.73

1.56

0.33

1.78

APD022

13.86

14.84

0.975

2.03

0.21

2.17

APD023

50.33

51.77

1.44

1.55

0.73

2.05

APD024

66.47

67.08

0.61

0.99

0.32

1.21

APD025

38.49

39.62

1.13

0.90

0.15

1.00

APD026

19.59

21.42

1.83

1.31

0.43

1.60

*A copper price of US$8,000 and a gold price of US$1,700 were used for the purposes of calculating a copper equivalent

grade.

The Company has elected to investigate the potential for an open pit to mine copper sulphides and oxides. Oxides are known

to occur at or near surface from the outcrop of the Ongombo deposit coincident with the Central Shoot. Initially assumed to

extend for a strike length of approximately 350m, recent drilling has extended the zone coincident with copper grades >1%

Cu to over 750m. Drilling has also demonstrated that the down-dip extension from the gossan outcrop extends in some

locations to approximately 185m, considerably wider (in the horizontal plane) than initially anticipated at 100 to 150m.

Subject to mineral resource estimation work following the completion of drilling and the return of assay data, indications are

that a viable copper resource suitable for open pit extraction may occur. There also appears to be scope to add to the existing

underground resource with deeper mineralised intercepts expected to be beyond any future pit floor. The bulk of

mineralisation defined to date with the exception of the zone closest to the Ongombo gossan outcrop and to a vertical depth

of between 10 and 15m is sulphide-type mineralisation dominated by pyrite and chalcopyrite.

The Ongombo orebody plunges to the NNE and an area has broadly been defined suitable for mine infrastructure where any

future ore extraction would be from underground.

Environmental and Social Impact Assessment (”ESIA”)

The ESIA was submitted in Q4 202 and post year end on 25 April 2023 the award of an Environmental Clearance Certificate

for the Ongombo (copper-gold) Project located within Exclusive Prospecting Licence EPL 5772 was announced.

ZAMBIA:

As mentioned in the Corporate Transactions summary above on 19 January 2022 African Pioneer Zambia Ltd entered into

an option agreement with First Quantum (listed on the Toronto Stock Exchange FM.TO) in relation to 4 of the 5 Zambian

exploration licences held by African Pioneer Zambia.

On 24 October 2022 and on 6 February 2023 the Company has provided updates on the ongoing exploration activities

undertaken by First Quantum during Q3 and Q4 2022 on the 4 Zambia licences subject to the Option Agreement the Company

believes these updates to be very encouraging and below summarise the highlights and also provide detail of the exploration

activities during the second half of 2022. We have provided this information in the following four sections:

AFRICAN PIONEER PLC

FINANCIAL CORPORATE AND OPERATIONAL REVIEW (continued)

1. Highlights of Q3 2022 exploration undertaken by First Quantum (24 October 2022 announcement)

2. Highlights of Q4 2022 exploration undertaken by First Quantum (6 February 2023 announcement)

3. Work Completed Q3 2022

4. Work Completed Q4 2022

5. Planned Exploration Work

1. Highlights of Q3 2022 exploration undertaken by First Quantum (24 October 2022 announcement)

• The September 2022 latest quarterly report from joint venture partner First Quantum Minerals demonstrates very

positive results including confirmation of copper mineralisation in drill testing of three new targets.

• Soil geochemical surveys were carried out over seven targets.

• Air-core drilling was carried out over 3 targets defined by soil geochemistry has discovered copper in veins and

disseminations at all the prospects tested to date, with visual estimations ranging from trace up to 2% copper

mineralisation over some 75m in hole TUAC012.

• Completion of an audio-magnetotelluric (“AMT”) geophysical survey totalling 54.9-line km has detected

architectural patterns typically associated with Congolese-type copper mineralisation presenting an exciting new

exploration concept in parallel with the existing targets.

• A deep drillhole has commenced to examine the prognosis that the geologic setting may be analogous to the ‘Western

Foreland’ in the nearby DRC, host to Ivanhoe Mines Limited’s recently commissioned Kamoa mine, reported to

become one of the largest copper mines in the World.

2. Highlights of Q4 2022 exploration undertaken by First Quantum (6 February 2023 announcement)

• The fourth quarter 2022 report from joint venture partner First Quantum confirmed encouraging copper oxide

intercepts at three shallow drill targets and potentially significant copper mineralisation in two holes on a separate

licence being explored for geological settings similar to the giant Kamoa-Kakula deposits in the DRC.

• Preliminary analytical results for shallow air-core drilling completed in the previous quarter over soil geochemical

targets on licence 27770-HQ-LEL recorded several copper mineralised intervals hosted in black shales on the Turaco

and Eagle targets – final assay results are awaited.

• Two deep drillholes were completed 5km apart at the Ikatu target on licence 27767-HQ-LEL to test if the geologic

setting is analogous to the ‘Western Foreland’ domain in the nearby DRC, host to Ivanhoe Mines Limited’s Kamoa-

Kakula mines, projected to be one of the highest grade major copper mines in the world. The target Diamictite unit

was encountered in both holes, with visible copper mineralisation being identified at different stratigraphic levels in

each hole:

o Hole IKDD001A intersected chalcocite, bornite and chalcopyrite copper mineralisation about 180m below

the Diamictite unit over 2.9m from 430.9m depth

o Hole IKDD002 encountered a 2m zone of strong alteration and irregular disseminated chalcocite

mineralisation at the base of the target Diamictite unit at about 600m depth

• First Quantum considers it is a positive sign to see copper mineralisation at the same Grand Conglomerat/Diamicrite

stratigraphic level as at Kamoa-Kakula in DRC.

• Future work planned by First Quantum includes additional AMT geophysical survey lines in 27767-HQ-LEL, further

diamond drilling at the Ikatu target, follow up diamond drilling at the Turaco and Eagle targets and aircore drilling

of additional targets in 27770- and 27771-HQ-LEL.

AFRICAN PIONEER PLC

FINANCIAL CORPORATE AND OPERATIONAL REVIEW (continued)

3. Work Completed Q3 2022

Soil Sampling

Infill soil sampling was undertaken at seven targets across large-scale exploration licences 27770- and 27771-HQ-LEL.

Analysis was carried out in-house by pXRF. The best results received were from the Eagle and Turaco targets in 27770-HQ-

LEL (Kasongo licence) and Kanyika and Chipopa in 27771-HQ-LEL (Luamata South licence). Geological mapping and rock

sampling was also carried out at all seven targets across both licences.

Receipt of XRF analyses for the bulk of the soil samples collected and subsequent interpretation has generated several

coherent zones of copper anomalism over significant areas, up to 1,406ppm Cu.

At Turaco, significant Cu soil anomalism was encountered (> 250ppm Cu over 2.3 x 2.2km area, up to 1,406ppm Cu) adjacent

to a major structure and overlying an interpreted salt diapir in AMT.

At Eagle, significant soil Cu anomalism occurs (5 x 2km, up to 795ppm Cu) adjacent to a major structure and overlying an

interpreted salt diapir in AMT.

At Kanyika, a string of high tenor soil Cu anomalies was delineated (up to 983ppm Cu) associated with a major NE-trending

structure.

At Chipopa, a strong soil Cu anomaly occurs straddling a major lithotectonic boundary (>150ppm Cu over 2.3 x 1.3km, up

to 639ppm Cu).

Air-Core Drilling

Air-core drilling of the Turaco, Eagle and Kanyika targets totalled 66 holes for 4,028m. Such drilling is designed to provide

first-pass information on the shallow geology and mineralisation beneath sand and laterite cover rather than a definitive target

test.

At Turaco, copper mineralisation encountered included drillhole TUAC012 which intersected carbonaceous shale from

surface with 1% malachite, which transitioned to a lighter grey talc-altered shale with dolomite-chalcopyrite veins (up to 3%

volume) after 29m depth. Dolomite-chalcopyrite veins continued to end-of-hole (75m) and after 70m there is very fine-

grained disseminated chalcopyrite (up to 2%, 0.8% Cu on pXRF) within strongly silicified shale.

At Eagle, the most frequently encountered units were strongly altered shales, breccias and mafic intrusives. Several drillholes

intersected a vuggy ferruginous silicified rock with Mn-oxide coating fractures which yielded anomalous Cu and Ni on pXRF

(>1,200ppm Cu). This strongly silicified rock was not possible to drill through with air-core and was typically found adjacent

to altered breccias. Best visible mineralisation was from the West of the target area in hole EAAC014, which intercepted a

zone from 99-103m of brecciated carbonaceous shale with dolomitic infill with up to 2% disseminated chalcopyrite.

At Kanyika, in the NW of the area drilled, there is a doleritic sill overlain by a micaceous sandstone and quartzite (possibly

contact metamorphosed). The dolerite often has patches of strong alteration and intense calcite-hematite veining, sometimes

associated with minor disseminated chalcopyrite and/or pyrite (up to 0.5%).

Audio Magneto-Tellurics (AMT) Geophysical Survey

This survey was completed the across the 27770-HQ-LEL (Kasongo) and 27767-HQ-LEL (Ikatu) licences in June 2022. In

total, 54.9 line km was surveyed in 2022. Such deep penetrating surveys can provide important information on the structural

and stratigraphic framework of the region to assist with target selection and evaluation.

AMT results from Kasongo suggest soil anomalies could be related to salt diapirism adjacent to major structures (e.g. classic

Congolese-style). AMT lines within the Ikatu licence suggest that the Western Foreland domain boundary passes through the

licence. This domain in Zambia could offer prospective stratigraphy like the world-class Kamoa-Kakula deposit complex in

the DRC.

A ‘framework’ diamond drillhole was planned to test stratigraphy within the Western Foreland domain at Ikatu to see if a

conductive unit within the sedimentary package here overlies basement at depth.

4. Work Completed Q4 2022

AFRICAN PIONEER PLC

FINANCIAL CORPORATE AND OPERATIONAL REVIEW (continued)

Air-Core Drilling Analytical Results

pXRF analytical results have now been received for sample pulps from the 2022 air-core shallow drilling programme at

Turaco and Eagle targets in 27770-HQ-LEL. Selected intervals of interest are shown in Table 1 below. At Turaco, best results

were from the north of the target where drillhole TUAC012 intersected several significant copper intercepts within a silicified

and talc-altered black shale, including an oxide mineralised zone with 8m @ 1.19% Cu from 5m depth. Elsewhere at Turaco,

another drillhole intersected 1m @ 1.14% Cu within a thin black shale unit.

At Eagle target, the best intercept was in drillhole EAAC005 which intersected 29m @ 0.33% Cu, including 7m @ 0.61%

Cu within a strongly chlorite-clay altered rock.

Table 1 – Selected pXRF* Analytical Intervals From Aircore Drilling

Programme

Target

Hole No.

Depth

From (m)

Depth to

(m)

Interval

(m)

Cu%

Turaco

TUAC012

0.80

incl.

1.19

0.34

0.73

0.57

TUAC017

1.14

Eagle

EAAC005

0.33

incl.

0.61

It is planned to send samples from TUAC012 for a 4-acid ICP analysis with ALS Global laboratories in Johannesburg to

check for cobalt and other metal contents not possible to analyse with pXRF.

Drillholes adjacent to TUAC012, interpreted to be within the footwall of the mineralisation in TUAC012, exhibit strong

magnesian hydrothermal alteration within shales, breccias and diamictite. These drillholes also contain abundant pyrite

mineralisation as well as minor chalcopyrite.

‘Framework’ Diamond Drilling – Ikatu Target

Two diamond drillholes were successfully completed at the Ikatu target about 5km apart within the Western Foreland domain

in licence 27767-HQ-LEL. Both holes encountered copper mineralisation at two different stratigraphic positions.

The first drillhole (IKDD001A, 603.0 m), intercepted a diamictite unit from 229m to 252m, but with no visible copper

mineralisation. The diamictite has an oxidised sandstone matrix as opposed to the reduced diamictite which hosts copper

mineralisation at Kamoa-Kakula in DRC. However, at greater depth in IKDD001A, a 2.9m intersect of copper mineralisation

(chalcocite, bornite and chalcopyrite) was encountered from 430.9m to 433.8m at the top of a sequence of reduced rhythmites

(sandstone-siltstone and shale interbeds).

The second drillhole (IKDD002, 650.3m) also intersected the diamictite unit from 593.3m to 602.3m. For the most part, the

diamictite unit is hematitic and oxidized, as in IKDD001A, but at the base of the unit there is a 2m interval with strong

chlorite alteration and disseminated chalcocite mineralisation selectively targeting certain clasts. First Quantum considers it

is a positive sign to see copper mineralisation at the same part of the stratigraphy as at Kamoa-Kakula in DRC.

No analytical information is available as yet for the mineralisation encountered in these holes. First Quantum plans to send

half core samples to the ALS Global laboratory in Johannesburg for 4-acid ICP analysis.

Air Core sampling / pXRF analysis methodology

AFRICAN PIONEER PLC

FINANCIAL CORPORATE AND OPERATIONAL REVIEW (continued)

Each one metre interval Air Core sample is riffle split before being despatched to Intertek prep lab in Kitwe, Zambia. Samples

are dried at 1050°C for 8 hours, pulverised and sieved to 180 micron (SP13 method). The prepared samples were then

transported to an in-house lab at Kansanshi, where the powdered pulps are analysed by a portable X-ray fluorescence (pXRF)

instrument, analysing for 28 elements. The pXRF analysis includes the use of regular standards and blanks for calibration

however some variation to wet assay laboratory techniques can be expected and results are therefore considered indicative

only

5. Planned Work

Further planned work includes:

 Additional AMT survey lines in 27767-HQ-LEL

 Further diamond drilling at Ikatu target in 27767-HQ-LEL

 AC drilling of additional targets in 27770- and 27771-HQ-LEL

 Sampling of remaining soils in 27771-HQ-LEL (Chibwika East)

 Mapping and soil sampling in 27767- and 27768-HQ-LEL

 Follow up diamond drilling at Turaco and Eagle targets

BOTSWANA:

On 4 October 2021 the Company announced that it had entered into a two-year option agreement with ASX listed Sandfire

Resources Limited (ASX:SFR) (“Sandfire”) in relation to 4 of its 8 Botswana prospecting licences for a cash payment of

US$500,000 and the issue of 107,272 Sandfire shares (share price on 3 May 2022 – A$5.60 – approx. £3.17) and a 24 months

exploration expenditure commitment of US$1,000,000 (the “Botswana Option Agreement”).

Post the period end on 29 March 2023 the Company announced an update on exploration completed and planned over the

Kalahari Copper Belt Licences which are the subject of the Botswana Option Agreement.

Highlights

• PL101/2020 – Assays pending for a soil survey with further surveys planned over copper surface sample anomalies

together with a scheduled Airborne Gravity Gradiometry survey (“AGG”) over the Kuke Prospect

• Sandfire plans to mobilise a diamond rig to the Kuke Prospect to drill test a copper soil anomaly coincident with the

Kuke Fault

• PL100/2020 – Ongoing target generation and a scheduled AGG survey over the licence

• Sandfire also plans to undertake drilling on this licence in the coming weeks to test the Lower D’kar/Ngwako Pan

contact zone which is the horizon hosting most of the Kalahari Copperbelt deposits

OUTLOOK

AFRICAN PIONEER PLC

FINANCIAL CORPORATE AND OPERATIONAL REVIEW (continued)

Outlook for Copper: During the second half of 2022 into 2023 the copper price has recovered and forecasts for the price of

copper and its by-product metals remain positive in the range of US$10-US$15,000 per tonne. The outlook for copper supply

is quite pessimistic as most large copper mining projects have been shelved as a result of political or economic reasons but

we anticipate and from mid ’24 onwards this will lead to both smaller but profitable mines being developed , and junior

mining companies with good copper resources in reliable jurisdictions becoming potential targets for acquisitions by major

mining companies. As a result, the Company is well positioned with all its projects, to take part in a potential acquisition

boom or alternatively to attract financing for its own operations which might not otherwise have been available.

The major mining companies are seeking new projects for acquisition and all our projects have the fundamentals which may

attract the attention of larger companies as reflected in the fact that we have already entered into an agreement with Sandfire

in relation to certain of the Botswana Projects and First Quantum in relation to certain of the Zambian Projects.

We feel that there is a strong possibility that the current inflationary pressures and higher interest rates may slow down stock

markets but these conditions will be beneficial for the smaller metal producers who have historically outperformed under

these economic conditions.

The Board feels the Group has assembled an enviable portfolio of projects and we are pleased that Sandfire has taken and

retained a significant equity position in the Company. We look forward to advancing all our projects and providing our

shareholders with the prospects of enhanced value flowing into next year.

By Order of the Board

28 April 2023

AFRICAN PIONEER PLC

DIRECTORS’ REPORT

The directors present their report on the affairs of African Pioneer Plc (the “Company”) for the year ended 31 December

2022. The Company was incorporated on 20 July 2012.

PRINCIPAL ACTIVITIES

The principal activity of the Company and its subsidiaries (the “Group”) is the exploration for base metals in Zambia,

Namibia and Botswana.

Investing in small natural resource projects and mineral exploration projects can be very rewarding, but because of the issues

and uncertainties arising from exploration, resource estimation, commodity price volatility, politics and the financing of such

projects, there is a significant possibility of such reward not materialising. As a result of the nature and size of the Company

it will, in the early years particularly, be exposed to a concentration of risk either by sector or geographically, or possibly

both. These risks are outlined in more detail in the Strategic Report.

REVIEW OF THE BUSINESS

During the year, the Group made a loss of £(670,871) - 2021: restated profit of £273,471.

A review of the current and future development of the Group’s business are included in the Strategic Report.

The Directors do not recommend the payment of a dividend.

SUBSEQUENT EVENTS

Details of subsequent events after the year end are disclosed in note 18 o the financial statements

DIRECTORS

The names of the Directors who served throughout the period and subsequent to the year end, except where shown

otherwise, are as follows:

C Bird

R. Samtani

C Cordier

K Thygesen

J Cunningham-Davis

Directors’ interests in the ordinary share capital of the Company at the date of this report are disclosed within the

Directors Remuneration Report

DIRECTOR’S REMUNERATION

The Directors’ remuneration is detailed in the Directors’ Remuneration Report on pages 19 to 21

DIRECTORS’ AND OFFICERS’ INDEMNITY INSURANCE

The Group has purchased Directors’ and Officers’ liability insurance which provides cover against liabilities arising against

them in that capacity.

AFRICAN PIONEER PLC

DIRECTORS’ REPORT (continued)

USE OF FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT

Details of the use of financial instruments and associated risk management by the Group are included in note 3 to the financial

statements.

SUBSTANTIAL SHAREHOLDINGS

Other than Directors interests which are set out below on a separate table in this report, the following shareholders held 3%

or more of the issued share capital of the Company at 21 April 2023. These holdings are extracted as they appear in the

relevant custodian account in the Company’s share register.

Registered Shareholder

No. of Ordinary Shares

% of Ordinary

Shares in issue

The Bank Of New York (Nominees) Limited *

34,785,714

18.15%

Sandfire Resources Limited

28,418,932

14.82%

HSBC Global Custody Nominee (UK) Limited *

24,871,784

12.97%

Hargreaves Lansdown (Nominees) Limited *

15,871,987

8.28%

Mohamad Ali Ahmad

15,000,000

7.82%

Jim Nominees Limited *

7,142,856

3.73%

Vidacos Nominees Limited *

6,715,095

3.50%

132,806,368 69.28%

*Nominee shareholder; not beneficial owner.

UK STREAMLINED ENERGY AND CARBON REPORTING

The Group’s UK energy and carbon information is not disclosed as the Company qualifies as it consumed less than 40MWh

and is a Low Energy user in the UK.as defined in the Environmental Reporting Guidelines Including streamlined energy

and carbon reporting guidance March 2019 (Updated Introduction and Chapter 1) and as such is not required to provide

detailed disclosures of energy and carbon information. The Company has no UK-based subsidiaries and its overseas

subsidiaries, some of which own exploration licences and conduct exploration activities outside the U.K. are not required to

report U.K. energy consumption in their own right. The Company was also below this threshold in 2021.

POLITICAL DONATIONS

The Group made no political donations during the year (2021: none).

STATEMENT AS TO THE DISCLOSURE OF INFORMATION TO

THE AUDITORS AND DIRECTORS’ RESPONSIBILITIES

The Directors (being Colin Bird-Chairman, Raju Samtani-Finance Director, Christian Cordier-Business Development

Director, Kjeld Thygesen -Independent Non-Executive Director and James Cunningham-Davis Non-Executive Director, who

were in office at the date of approval of this report, confirm that, so far as they are aware, there is no relevant audit information

of which the Company’s auditor is unaware of and that they have taken all reasonable steps to take themselves aware of any

relevant audit information and to establish that the Company’s auditor is aware of that information.

AFRICAN PIONEER PLC

DIRECTORS’ REPORT (continued)

The Directors are responsible for preparing the financial statements in accordance with the Disclosure Guidance and

Transparency Rules of the United Kingdom’s Financial Conduct Authority (“DTR”) and with International Financial

Reporting Standards as adopted by the United Kingdom.

The Directors confirm to the best of their knowledge that:

• the financial statements have been prepared in accordance with the relevant financial reporting framework and give a

true and fair view of the assets, liabilities, financial position and profit or loss of the Group and the Company; and

• the Strategic Report and Directors’ Report include a fair review of the development and performance of the business

and the financial position of the Group and the Company, together with a description of the principal risks and uncertainties

that it faces; and

• the annual report and financial statements, taken as a whole, are fair, balanced, and understandable and provide the

information necessary for shareholders to assess the Group’s position, performance, business model and strategy.

AUDITORS

The auditors, Shipleys LLP have indicated their willingness to continue in office. A resolution to re-appoint them will be

proposed at the forthcoming Annual General Meeting.

Signed on behalf of the Board:

28 April 2023

Colin Bird Raju Samtani

Executive Chairman Director

AFRICAN PIONEER PLC

DIRECTORS’ REMUNERATION REPORT

This Remuneration Report sets out the Group’s policy on the remuneration of Directors, together with details of Directors’

remuneration packages and service contracts for the year ended 31 December 2022.

The Company’s policy is to maintain levels of remuneration to attract, motivate, and retain Directors and Senior Executives

of the highest calibre who can contribute their experience to deliver industry-leading performance with the Company’s

operations. The Company is nonetheless mindful of the need to balance this objective with the fact that it is pre-revenue.

Since listing on 1 June 2021, the Company’s Directors have largely remunerated through a combination of modest salaries

and/or fees and where relevant, equity positions as founders and as a result the total salaries and fees payable to directors has

been relatively modest.

As the Company grows, and increasingly makes hires, it will become necessary to move to a more long-term and sustainable

policy, which continues to align the interests of Directors and senior staff with those of shareholders while recognising that

new hires will not initially have a significant equity position.

Accordingly, it is likely that compensation packages for Executive Directors will need to move over time to a level more

consistent with the market. Currently, Directors’ remuneration is not subject to specific performance targets. The Company

is sufficiently small that the Board does not consider that it is necessary to impose such targets as a matter of principle but

believes that exceptional performance can be rewarded on an ad hoc basis.

As outlined in last year’s Directors Remuneration Report the Board proposed and shareholders approved at the 2022 AGM

a share option scheme which is to incentivise both Executive and non-Executive Directors as well individuals holding

positions of responsibility in the Company

(“Share Option Scheme”). On 24 January 2023 the Company announced that

pursuant to the Executive Share Option Scheme approved at the Company’s Annual General Meeting (“AGM”) held on 23

August 2022 16,850,000 options over Ordinary Shares (“Options”) were awarded, 6,600,000 of the Options were awarded

to directors of the Company, as detailed further in Note 18 and the balance of 10,250,000 Options to other eligible

participants. The Company had not previously issued any Options.

The 2022 AGM also approved the Company establishing new incentive schemes to more closely align the interest of

directors, officers, employees and consultants with those of shareholders by providing for the payment of short-term, annual

and transaction incentive awards in cash or Company shares (the “Proposed Incentive Schemes”). Awards under the

Proposed Incentive Schemes are not intended to replace the Share Option Scheme arrangements and the Proposed Incentive

Schemes, shall continue in place until the Board of the Company have put an alternative incentive scheme to the Company’s

shareholders which the Company’s shareholders have approved.

The Board considers the remuneration of Directors and senior staff and their employment terms and makes recommendations

to the Board of Directors on the overall remuneration packages. No Director takes part in any decision directly affecting their

own remuneration.

There has been no correspondence to date from shareholders relating to Directors’ remuneration matters and therefore no

such matters have been considered by the Board in formulating the Company’s remuneration policy.

In determining Executive Director remuneration policy and practices, the Board aims to address the following factors:

• Clarity - remuneration arrangements should be transparent and promote effective engagement with shareholders and

the workforce;

• Simplicity - remuneration structures should avoid complexity and their rationale and operation should be easy to

understand;

AFRICAN PIONEER PLC

DIRECTORS’ REMUNERATION REPORT (Continued)

•

• Risk - remuneration arrangements should ensure reputational and other risks from excessive rewards, and risks that

can arise from target-based incentive plans, are identified and mitigated;

• Predictability - the range of possible values of rewards to individual directors and any other limits or discretions are

identified and explained at the time of approving the policy;

• Proportionality – the clarity of the link between individual awards,

the delivery of strategy and the long-term

performance of the company should be clear; and

• Alignment to culture - incentive schemes, when implemented will drive behaviours consistent with company

purpose, values and strategy.

Directors’ remuneration

Remuneration of the Directors for the years ended 31 December 2022 and 2021 was as follows:

2022

2021

Directors’ Fees

Consulting

Fees

Total

Emoluments

Total

Emoluments

C. Bird

18,000

42,000

60,000

35,000

R. Samtani

18,000

32,004

50,004

29,169

C Cordier

18,000

12,000

30,000

16,500

K Thygesen

18,000

10,500

James Cunningham-Davis

14,400

9,300

Total

86,400

86,004

172,004

100,469

Each of the Directors entered into service agreements at the time of the Company’s admission to the market on 1 June 2021.

Details of Directors’ Letters of Appointment and Service Agreements as disclosed in Note 16 of these Financial Statements.

There were no pensions or other similar arrangements in place with any of the Directors during the years ended 31

December 2022 or 2021.

Payments to past directors

The Company did not pay any compensation to past Directors in 2022 and 2021.

DIRECTORS’ INTERESTS

The beneficial interest of the directors, their spouses and minor children in the share capital of the Company are as follows:

Ordinary Shares of No Par Value

31 December 2022

31 December 2021

C Bird*

21,061,728

R Samtani

16,061,728

J Cunningham-Davis***

C Cordier**

15,000,000

K Thygesen

200,000

AFRICAN PIONEER PLC

DIRECTORS’ REMUNERATION REPORT (Continued)

* Colin Bird’s shareholding includes 5,000,000 ordinary shares held by Campden Park Trading, a company owned and controlled by

Colin Bird , the Company’s Chairman

** Christian Cordier’s shareholding includes 4,000,000 ordinary shares held by Tonehill Pty Ltd and 3,000,000 ordinary shares held by

Coreks Super Pty Ltd both of which companies are owned and controlled by Christian Cordier. It also includes

8,000,000 ordinary shares held by Breamline Pty Ltd of which Christian Cordier is a director and which is a trustee company for Breamline

Ministries

*** 230,000 warrants are held by Cavendish Trust of which James Cunningham -Davis is a director and a controlling majority

shareholder.

There have been no further changes in directors' interests since the year end other than the issue of Options detailed below

which were announced on 23 January 2023.

Approved by the Board on 28 April 2023.

AFRICAN PIONEER PLC

CORPORATE GOVERNANCE REPORT

Corporate Governance

The Board guides and monitors the business and affairs of the Company on behalf of the Shareholders to whom it is

accountable and is responsible for corporate governance matters. While certain key matters are reserved for the Board, it has

delegated responsibilities for the day-to-day operational, corporate, financial and administrative activities to the Business

Development Director, the Executive Chairman and the Finance Director.

In assessing the composition of the Board, the Directors have had regard to the following principles:

• the role of the Executive Chairman and the other directors should not be exercised by the same person;

• the Board should include at least one independent non-executive director, increasing where additional expertise is

considered desirable in certain areas, or to ensure a smooth transition between outgoing and incoming non-executive

directors; and

• the Board should comprise of directors with an appropriate range of qualifications and expertise.

The Company believes it complies with each of these principles.

Both James Cunningham-Davis and Kjeld Thygesen are the Non-Executive Directors of the Company. James Cunningham-

Davis is one of the directors of Cavendish Secretaries Limited, a subsidiary of Cavendish Trust Company Limited, which

provides secretarial services to the Company in the Isle of Man and is therefore for these purposes not considered

independent.

Kjeld Thygesen has a holding of Ordinary Shares representing 0.10 per cent. of the issued share capital and he is considered

independent given this holding is de minimis.

Directors appointed by the Board are subject to election by shareholders at the Annual General Meeting of the Company

following their appointment and thereafter are subject to re-election in accordance with the Company’s Articles of

Association.

The QCA Corporate Governance Code, as published by the Quoted Companies Alliance, is tailored for small and mid-size

quoted companies in the United Kingdom. The Company will, to the extent practicable for a company of its size and nature,

follow the QCA Corporate Governance Code. The Directors are aware that there are currently certain provisions of the QCA

Corporate Governance Code that the Company is not in compliance with, given the size and early stage nature of the

Company. These include, inter alia:

• The Company does not currently have a remuneration, nomination or risk committee. The Board as a whole will

review remuneration, nomination and risk matters, on the basis of adopted terms of reference governing the matters

to be reviewed and the frequency with which such matters are considered. The Board as a whole will also take

responsibility for the appointment of auditors and payment of their audit fee, monitor and review the integrity of the

Company’s financial statements and take responsibility for any formal announcements on the Company’s financial

performance.

• Unless further independent non-executive directors are appointed, the Board will not comply with the provision of

the QCA Corporate Governance Code that at least to members of the Board, excluding the Chairman, should

comprise non-executive directors determined by the Board to be independent.

• The Executive Chairman of the Company is an executive director rather than an independent non-executive director

as suggested by the QCA corporate governance code

AFRICAN PIONEER PLC

CORPORATE GOVERNANCE REPORT (continued)

Share Dealing Code

The Company has adopted, with effect from Admission, a share dealing policy regulating trading and confidentiality of inside

information for the Directors and other persons discharging managerial responsibilities (and their persons closely associated)

which contains provisions appropriate for a company whose shares are admitted to trading on the Official List (particularly

relating to dealing during closed periods which will be in line with the Market Abuse Regulation). The Company will take

all reasonable steps to ensure compliance by the Directors and any relevant employees with the terms of that share dealing

policy.

Audit Committee

The Audit Committee is chaired by James Cunningham-Davis and its other member is Christian Cordier. The Audit

Committee meets at least twice a year, or more frequently if required. The Audit Committee is responsible, amongst other

things, for making recommendations to the Board on the appointment of auditors and the audit fee, monitoring and reviewing

the integrity of the Company’s financial statements and any formal announcements on the Company’s financial performance

as well as reports from the Company’s auditors on those financial statements.

In addition, the Audit Committee considers and reviews the Company’s internal financial control and risk management

systems to assist the Board in fulfilling its responsibilities relating to the effectiveness of those systems, including an

evaluation of the capabilities of such systems in light of the expected requirements for any specific acquisition target.

Meetings of the Directors

The number of meetings of the board of directors of the Company and its committees held during the year ended 31 December

2022 and the number of meetings attended by each director is tabled below. The audit committee was formed on 26 May

2021 prior to the Company's listing on the London Stock Exchange

2022

Meetings

Meetings attended

Board

Audit

Board

Audit

C. Bird

R. Samtani

J. Cunningham-Davis

K Thygesen

C. Cordier

Diversity Policy

The Board operates a policy whereby Directors and other individuals considered for employment and professional services

across the Group are selected on the basis of their experience, professional qualifications and ability and a such the Company

does not discriminate on aspects such as age, gender or educational and professional background.

The Company is a small exploration company and the Company’s only employees comprising of the 5 Board Directors

who have been in office since the Listing on 1 June 2021 and were the Board members on the basis of whose experience

and expertise investors invested in the Company at the time of the Listing. The Company has at the date of these accounts

not expanded or changes the composition of its Board and accordingly has not met the following

targets on board diversity

(i) at least 40% of the individuals on its board of directors are women; and

(ii) at least one of the following senior positions on its board of directors is held by a woman (A) the chair; (B) the chief executive;

The Company has met the target that at least one individual on its board of directors s from a minority ethnic background

AFRICAN PIONEER PLC

CORPORATE GOVERNANCE REPORT (continued)

The diversity composition of the Board is shown in the table below:



Number of

board

members

Percentage of

the board

Number of senior

positions on the

board (CEO, CFO,

SID and Chair)

Number in

executive

management

Percentage of

executive

management

Men 5

100 %

100%

Women 0

Nil

Ethnic Background of Board members

Number

of board

members

Percentage

of the

board

Number

of senior

positions

on the

board

(CEO,

CFO,

SID and

Chair)

Number in

executive

management

Percentage

of executive

management

White British or other White

(including minority-white

groups)

80%

66%

Mixed/Multiple Ethnic Groups

Asian/Asian British

20%

33%

Black/African/Caribbean/Black

British

Other ethnic group, including

Arab

Not specified/ prefer not to say

Internal control

The Board is responsible for establishing and maintaining the Group’s system of internal control. Internal control systems

manage rather than eliminate the risks to which the Group is exposed and such systems, by their nature, can provide

reasonable but not absolute assurance against misstatement or loss.

There is a continuous process for identifying, evaluating and managing the significant risks faced by the Group. The key

procedures which the Directors have established with a view to providing effective internal control, are as follows:

• Identification and control of business risks The Board identifies the major business risks faced by the Group and

determines the appropriate course of action to manage those risks.

AFRICAN PIONEER PLC

CORPORATE GOVERNANCE REPORT (continued)

• Budgets and business plans Each year the Board approves the business plan and annual budget. Performance is monitored

and relevant action taken throughout the year through the regular reporting to the Board of changes to the business

forecasts.

• Investment appraisal Capital expenditure is controlled by budgetary process and authorisation levels. For expenditure

beyond specified levels, detailed written proposals must be submitted to the Board. Appropriate due diligence work is

carried out if a business or asset is to be acquired.

Environmental, Social and Governance (ESG) Policy

African Pioneer plc practises responsible exploration as reflected in our ESG policy and our activities. By doing so we reduce

project risk, avoid adverse environmental and social impacts, optimising benefits for all stakeholders while adding value to

our projects.

Our business associates, consultants and contractors perform much of our primary activities at our projects and therefore we

require that all representatives and contractors working on our behalf or for our subsidiaries accept and adhere to the

principles set out in this policy. We encourage input from those with local knowledge and we review this policy on a regular

basis.

Our ESG policy is guided by the Prospectors & Developers Association of Canada’s (PDAC) Framework for Responsible

Exploration (known as e3 Plus) which encourages mineral exploration companies to complement and improve social,

environmental and health and safety performance across all exploration activities around the world.

Adopting Responsible Governance and Management

: African Pioneer is committed to environmentally and socially responsible

mineral exploration and has developed and implemented policies and procedures for corporate governance and ethics. We

ensure that all staff and key associates are familiar with these and have the appropriate level of knowledge of these policies

and procedures.

The Company employs persons and engages contractors with the required experience and qualifications relevant to their

specific tasks and, where necessary, seeks the advice of specialists to improve understanding and management of social,

environmental, human rights and security, and health and safety.

African Pioneer’s Corporate Governance Statement can be viewed on our website and the Company has an Anti-Bribery and

Corruption policy and an Anti-Slavery policy.

•

Applying Ethical Business Practices: As well as our shareholders and staff, our stakeholders include local communities

and local leadership, government and regulatory authorities, suppliers, contactors and consultants, our local business

partners and other interested parties. Our corporate culture and policies require honesty, integrity, transparency and

accountability in all aspects of our work and when interacting with all stakeholders.

The Company takes all necessary steps to ensure that activities in the field minimise or mitigate any adverse impacts on

both the environment and on local communities.

•

Respecting Human Rights: The exploration activities of African Pioneer are carried out in line with applicable laws on

human rights and the Company does not engage in activities that have adverse human rights impacts.

•

Commitment to Project Due Diligence and Risk Assessment: We make sure we are informed of the laws, regulations,

treaties and standards that are applicable with respect to our activities. We ensure that relevant parties are informed and

prepared before going into the field in order to minimise the risk of miscommunication, unnecessary costs and conflict,

and to understand the potential for creating opportunities with local communities where possible.

AFRICAN PIONEER PLC

CORPORATE GOVERNANCE REPORT (continued)

• Engaging Host Communities and Other Affected and Interested Parties: African Pioneer is committed to engaging

positively with local communities, regulatory authorities, suppliers and other stakeholders in its project locations, and

encourages feedback through this engagement. Through this process, the Company develops and fosters the relationships

on which our business relies for success.

•

Protecting the Environment: We are committed to ensuring that environmental standards are met or exceeded in the

course of our exploration activities. Applicable laws and local guidelines in all project jurisdictions are followed

diligently and exploration programmes are only carried out once relevant permits and approvals have been secured from

the appropriate regulatory bodies.

African Pioneer is committed to good practices in rehabilitation and repair during its mineral exploration activities and,

where possible, choose less impactful exploration methods to limit disturbance.

•

Safeguarding the Health and Safety of Workers and the Local Population: Company activities are carried out in accordance

with good practice and applicable laws related to Health and Safety.

Environment Health, safety and community statement

The Group is committed to providing a safe working environment for all its employees and to responsibly manage all of the

environmental interactions of its business. Its objective is to perform and achieve at a level notably in excess of the regulatory

minima required by the host countries in which it does business.

The following specific principles are adhered to by the Group:

Health & Safety

• Provision of health and safety training to all employees;

• All necessary measures are taken to minimise workplace injuries, and

• Establishment of management and advisory programmes for the prevention of transmissible diseases.

Environment

The Group prides itself on being a skilled and responsible operator. It functions with the clear mandate of being in full

compliance with corporate standards, applicable environmental laws, regulations and permit requirements. It has an internal

monitoring programme in place that plays a critical role in continuously improving its environmental performance.

The Group strives to minimise its environmental effects wherever and to:

• Comply with applicable laws, regulations and commitments wherever it operates;

• Ensure it has the necessary resources, procedures, training programmes and responsibilities in place to achieve its

environmental objectives;

• Strive to protect air and water quality, minimise consumption of water and energy, and protect natural habitats and

biodiversity;

• Promote an ongoing environmental dialogue with its stakeholders in the communities where it conducts business;

• Collaborate with stakeholders to define environmental priorities and to protect the environment, and

• Consider the requirement for environmental protection in all aspects of exploration and development.

Communities

As well as recognising the need to protect the natural environment the Group will follow Best Practices in:

• its interactions with local communities,

• respecting customs and cultural practices, and • minimising intrusion upon lifestyles and traditions.

The Group will not violate human rights and will, wherever possible, favour employment for local people when it recruits.

It will strive to be recognised as a socially aware and responsible business

AFRICAN PIONEER PLC

CORPORATE GOVERNANCE REPORT (continued)

Task Force on Climate-related Financial Disclosures (TCFD)

The Company has not included climate-related financial disclosures consistent with any of the TCFD Recommendations and

Recommended Disclosures, as required by Listing Rule 14.3.27, neither in this annual financial report or any other document

as it has not yet established the metrics and obtained the data to do this. Set out below is a summary of the Company's

activities and how the Company proposes to align with the TCFD recommendations.

The Company will provide an update of its

alignment with the TCFD recommendations in next year's Annual Report.

The Company’s business strategy is to explore for base metals focusing on Southern Africa which are materials used to

produce diverse products used in modern living in a safe and sustainable environment for all its stakeholders with a focus on

copper projects. As an organisation, we recognise the growing importance of understanding the impact of climate change on

the environment in which we operate and its potential impact on the business.

TCFD was established in 2015 to improve and increase reporting of climate-related financial information and to provide

information to investors about the actions companies are taking to mitigate the risks of climate change, as well as to provide

increased clarity on the way in which they are governed.

The Company’s exploration activities are “asset” light as the Company does not own its drilling and exploration equipment

and instead uses contractors and it is a standard operating procedure for exploration activities to be conducted in accordance

with applicable environmental regulations. The effect of this is that the Company’s demand for and use of carbon fuels is

very low though its contractors will use carbon fuels. An opportunity arising for the Company’s from climate change is that

copper is projected to increase in response to the global green energy transition in particular for electric vehicles, charging

stations and the generation and distribution of renewable energy.

The Company is planning to adopt the TCFD framework and recommendations to the extent that it is appropriate given the

size of the company and its activities. The framework is useful as a guide to understand how climate change could impact a

broad range of business drivers and will provide a structured approach for the Group, to work towards embedding climate

into our decision-making and will enable us to learn from and apply best practice on reporting and disclosures.

We see this as a means to increase the quality and transparency in our climate related disclosures whilst taking the first steps

on the roadmap of TCFD reporting. We aim to ensure our stakeholders will have a better understanding of the Company’s

operational and business resilience to climate change and how we will incorporate the consideration of climate-related risks

and opportunities in our business model. The table below provides a brief statement on our current thought process to

understand and begin aligning with the TCFD recommendations.

Governance: The Group’s governance relating to climate-related risks and opportunities is the responsibility of the Board.

Strategy: The actual and potential impacts of climate-related risks and opportunities will have effects on the business

policies, strategy and financial planning of APP.

Risk Management: The financial director is responsible for APP’s risk assessment and identifying, assessing, and

managing climate related risks is part of that function.

Metrics & Targets: The formulation of metrics and targets used to assess and manage relevant climate related risks and

opportunities will be considered.

AFRICAN PIONEER PLC

STRATEGIC REPORT)

The Directors present their strategic report on the group for the year ended 31 December 2022.

PRINCIPAL ACTIVITY

African Pioneer Plc (“the Company”) is a public limited company which is listed on the main market of the London Stock

Exchange and incorporated and domiciled in the Isle of Man. The Company’s registered address is 34 North Quay, Douglas,

Isle of Man, IM1 4LB.

The Company is the parent company of African Pioneer Zambia Ltd, Resource Capital Partners Pty Ltd and Zamcu

Exploration Pty Ltd, which has an 85% equity holding in Manmar Investments One Hundred and Twenty Nine (Pty) Ltd

and Manmar Investments One Hundred and Thirty Six (Pty) Ltd. (see note 10 for further details).

The principal activity of the Company and its subsidiaries (the “Group”) is the exploration for base metals in Zambia,

Namibia and Botswana.

GOING CONCERN

As disclosed in Note 2 The Group made a loss from all operations for the year ended 31 December 2022 after tax of

£(671,000) (2021: restated profit of £273,471). An operating loss is expected in the year subsequent to the date of these

accounts and as a result the Company will need to raise funding to provide additional working capital to finance its ongoing

activities. The management team has successfully raised funding for exploration projects in the past, but there is no guarantee

that adequate funds will be available when needed in the future.

Based on its current reserves and the Board's assessment that the Company will be able to raise additional funds, as and when

required, to meet its working capital and capital expenditure requirements, the Board have concluded that they have a

reasonable expectation that the Group can continue in operational existence for the foreseeable future. For these reasons the

financial statements have been prepared on the going concern basis, which contemplates continuity of normal business

activities and the realisation of assets and discharge of liabilities in the normal course of business.

KEY PERFORMANCE INDICATORS

The key performance indicators in assessing the completion of this activity are monitored on a regular basis:

• Progress with exploration, monitoring licence commitments and environmental compliance; and

• Cash management – ensuring that the Company is well funded and has adequate cash to meet to meet its obligations as they

fall due.

REVIEW OF THE BUSINESS

Details of the Company’s strategy, results and prospects are set out in the Chairman’s Statement and in the Operations Report

on pages 3 to 15.

AFRICAN PIONEER PLC

STRATEGIC REPORT (continued)

Financial highlights:

• £671k consolidated loss after tax (2021: £273k - profit)

• Approximately £72k cash at bank at the year-end (2021: £1.19m).

• The basic and diluted losses per share are summarised in the table below

Profit/(Loss) per share

(pence)

2022

2021

restated

Basic

Note 6

(0.35)p

0.24p

Diluted

Note 6

(0.29)p

0.20p

• The net asset value of the Group at as at 31 December 2022 was £5.4M (31 December 2021 restated £6.1m)

INVESTMENTS HELD BY THE COMPANY FOR RESALE

At year-end, the Group held investments in five companies classified as available-for-sale investments and valued at

£395,750 and had a cash balance of £71,674. The Group is able to raise additional cash at short notice by selling its

investments which are liquid. It is the Group’s intention not to purchase any new investments and to hold its residual portfolio

as realisable investments as a source of liquidity to cover explorations costs and general overheads of the Group.

PORTFOLIO HOLDING AT 31 December 2022

Number

Cost

Valuation

31/12/22

31/12/21

Jubilee Metals Group Plc

217,802

8,266

22,107

35,393

Galileo Resources Plc

2,500,000

50,000

32,500

24,500

Sandfire Resources Ltd

107,272

302,960

329,325

379,489

South 32 Limited

30,044

Xtract Resources Plc

606,060

20,217

11,818

33,030

TOTAL FOR AFRICAN PIONEER

PLC

381,443

395,750

502,456

PRINCIPAL RISKS

AND UNCERTAINTIES

This business carries a high level of risk and uncertainty, although the potential rewards can be outstanding. The Directors

have identified the following principal risks in regards to the Group’s future. The relative importance of risks faced by the

Group can, and is likely to, change as the Group executes its strategy and as the external business environment evolves

the

strategy as may be required based on developments and exploration results. Key elements of this process are the Group’s monthly

reporting and Board meetings.

AFRICAN PIONEER PLC

STRATEGIC REPORT (continued)

Strategic risk

The Group’s strategy may not deliver the results expected by shareholders. The Directors regularly monitor the

appropriateness of the strategy, taking into account both internal and external factors, together with progress in and modify

Exploration risk

Exploration at the Namibia, Zambia and Botswana Projects may not result in success.

Whilst the Directors endeavour to apply what they consider to be the latest technology to assess projects, the business of

exploration for and identification of minerals and metals, is speculative and involves a high degree of risk. The mineral and

metal potential of the Group’s initial projects, Namibia and Zambia, may not contain economically recoverable volumes of

minerals, base metals, or precious metals of sufficient quality or quantity. To mitigate this risk, the Group has acquired the

rights to carry out exploration and earn an interest in certain licences in the specific areas.

Even if there are economically recoverable deposits, delays in the construction and commissioning of mining projects or

other technical difficulties may make the deposits difficult to exploit. The exploration and development of any project may

be disrupted, damaged or delayed by a variety of risks and hazards which are beyond the control of the Group. These include

(without limitation) geological, geotechnical and seismic factors, environmental hazards, technical failures, adverse weather

conditions, acts of God and government regulations or delays.

Exploration is also subject to general industrial operating risks, such as equipment failure, explosions, fires and industrial

accidents, which may result in potential delays or liabilities, loss of life, injury, environmental damage, damage to or

destruction of property and regulatory investigations. The Group may also be liable for the mining activities of previous

miners and previous exploration works. Although the Group intends, itself or through its operators, to maintain insurance in

accordance with industry practice, no assurance can be given that the Group or the operator of an exploration project will be

able to obtain insurance coverage at reasonable rates (or at all), or that any coverage it obtains will be adequate and available

to cover any such claims. The Group may elect not to become insured because of high premium costs or may incur a liability

to third parties (in excess of any insurance cover) arising from pollution or other damage or injury.

Environmental and other regulatory risks

In relation to the Group’s existing projects the environmental impact to date is limited to activities associated with

exploration. The ultimate development of any project into a mining operation will inevitably impact considerably on the local

landscape and communities. These projects sit in an area of considerable natural beauty and therefore there is likely to be

opposition to mining by some parties. This may impact on the cost and/or Group’s ability to sell or move these projects into

production.

While the Group believes that its operations and future projects are currently, and will be, in substantial compliance with all

relevant material environmental and health and safety laws and regulations, including relevant international standards, there

can be no assurance that new laws and regulations, or amendments to, or stringent enforcement of, existing laws and

regulations will not be introduced.

Nevertheless, the Group will continue to vigorously apply international standards to the design and execution of any and all

of its activities, including engagement and consultation with local communities, and non-governmental and Governmental

organisations to ensure any impacts of current and future activities are minimised and appropriately managed. The Group

has organisations to ensure any impacts of current and future activities are minimised and appropriately managed. The Group

AFRICAN PIONEER PLC

STRATEGIC REPORT (continued)

has established a comprehensive suite of health, safety, environmental and community policies which will underpin all future

activities.

Financing

The successful exploration or exploitation of natural resources on any project will require significant capital investment. The

only sources of financing currently available to the Group are through the issue of additional equity capital in the

Company or through bringing in partners to fund exploration and development costs. The Group’s ability to raise further

funds will depend on the success of their investment strategy and conditions in financial and commodity markets. The

Group may not be successful in procuring the requisite funds on terms which are acceptable to it (or at all) and, if such

funding is unavailable, the Group may be required to reduce the scope of its investments or anticipated expansion.

Political, economic and regulatory regime

The licences and operations of the Group are in jurisdictions outside the United Kingdom and accordingly there will be a

number of risks which the Group will be unable to control. Whilst the Group will make every effort to ensure it has robust

commercial agreements covering its activities, there is a risk that the Group’s activities will be adversely affected by

economic and political factors such as the imposition of additional taxes and charges, cancellation or suspension of licences

and changes to the laws governing mineral exploration and operations.

The Group’s activities will be dependent upon the grant of appropriate licences, concessions, leases, permits, and regulatory

consents that may be withdrawn or made subject to limitations. There can be no assurance that they will be granted or renewed

or if so, on what terms. There is also the possibility that the terms of any licence may be changed other than as represented

or expected.

The current focus of the Group’s activities, offer stable political frameworks and actively support foreign investment. The

countries have well-developed exploration and mining code and proactive support for foreign companies. Through a

programme of proactive engagement with each Government at all levels the Group is able to partially mitigate these risks by

establishing professional working relationships.

Dependence on key personnel

The Group is dependent upon its executive management team and various technical consultants. Whilst it has entered into

contractual agreements with the aim of securing the services of these personnel, the retention of their services cannot be

guaranteed. The development and success of the Group depends on its ability to recruit and retain high quality and

experienced staff. The loss of the service of key personnel or the inability to attract additional qualified personnel as the

Group grows could have an adverse effect on future business and financial conditions. Nevertheless, through programmes of

incentivising staff, appropriate succession planning, and good management these risks can be largely mitigated.

Uninsured risk

The Group, as a participant in exploration and development programmes, may become subject to liability for hazards that

cannot be insured against or third-party claims that exceed the insurance cover. The Group may also be disrupted by a variety

of risks and hazards that are beyond its control, including geological, geotechnical and seismic factors, environmental

hazards, industrial accidents, occupation and health hazards and weather conditions or other acts of God.

Other business risks

In addition to the current principal risks identified above and those disclosed in note 3 to the financial statements, the Group’s

business is subject to risks relating to the financial markets and commodity markets. The buoyancy of both the

aforementioned markets can affect the ability of the Group to raise funds for exploration. The Group has identified certain

risks pertinent to its business including:

AFRICAN PIONEER PLC

STRATEGIC REPORT (continued)

Strategic and Economic:

• Business environment changes

• Limited diversification

Operational:

• Difficulty in obtaining / maintaining / renewing Licences / approvals

Commercial:

• Failure to maximise value from its Namibia/Zambia/Botswana projects

• Loss of interest in key assets

• Regulatory compliance and legal

Human Resources and Management:

• Failure to recruit and retain key personnel

• Human error or deliberate negative action

• Inadequate management processes

Financial:

• Restrictions in capital markets impacting available financial resources

• Cost escalation and budget overruns

• Fraud and corruption

The Directors regularly monitor such risks, using information obtained or developed from external and internal sources, and

will take actions as appropriate to mitigate these. Effective risk mitigation may be critical to the Group in achieving its

strategic objectives and protecting its assets, personnel and reputation. The Group assesses its risk on an ongoing basis to

ensure it identifies key business risks and takes measures to mitigate these. Other steps include regular Board review of the

business, monthly management reporting, financial operating procedures and antibribery management systems. The Group

reviews its business risks and management systems on a regular basis

PROMOTION OF THE COMPANY FOR THE BENEFIT OF THE MEMBERS AS A WHOLE

The Director’s believe they have acted in the way most likely to promote the success of the Company for the benefit of its

members as detailed below.

- Consider the likely consequences of any decision in the long term

- Act fairly between the members of the Company,

- Maintain a reputation for high standards of business conduct,

- Consider the interests of the Company’s employees,

- Foster the Company’s relationships with suppliers, customers, and others, and

- Consider the impact of the Company’s operations on the community and the environment.

Our Board of Directors remain aware of their responsibilities both within and outside of the Group. Within the limitations

of a Group with so few employees we endeavour to follow these principles, and examples of the application of the s172

are summarised and demonstrated below.

The Group operates as a mining exploration and development business which is speculative in nature and at times may be

dependent upon fund-raising for its continued operation. The nature of the business is well understood by the Company’s

members, employees and suppliers, and the Directors are transparent about the cash position and funding requirements.

AFRICAN PIONEER PLC

STRATEGIC REPORT (continued)

The Company is investing time in developing and fostering its relationships with its key suppliers.

As a mining exploration company with future operations based in Scandinavia, the Board intends to take seriously its ethical

responsibilities to the communities and environment in which it works.

The interests of future employees and consultants are a primary consideration for the Board, and we have introduced an

inclusive share-option programme allowing them to share in the future success of the company. Personal development

opportunities are encouraged and supported.

OUTLOOK

Outlook for Copper: During the second half of 2022 into 2023 the copper price has recovered and forecasts for the price of

copper and its by-product metals remain positive in the range of US$10-US$15,000 per tonne. The outlook for copper supply

is quite pessimistic as most large copper mining projects have been shelved as a result of political or economic reasons and

from mid ’24 onwards we anticipate this will lead to both smaller but profitable mines being developed ,and junior mining

companies with good copper resources in reliable jurisdictions becoming potential targets for acquisitions by major mining

companies. As a result, the Company is well positioned with all its projects, to take part in a potential acquisition boom or

alternatively to attract financing for its own operations which might not otherwise have been available.

The major mining companies are seeking new projects for acquisition and all our projects have the fundamentals which may

attract the attention of larger companies as reflected in the fact that we have already entered into an agreement with Sandfire

in relation to certain of the Botswana Projects and First Quantum in relation to certain of the Zambian Projects.

We feel that there is a strong possibility that the current inflationary pressures and higher interest rates may slow down stock

markets but these conditions will be beneficial for the smaller metal producers who have historically outperformed under

these economic conditions.

The Board feels the Group has assembled an enviable portfolio of projects and we are pleased that Sandfire has taken and

retained a significant equity position in the Company. We look forward to advancing all our projects and providing our

shareholders with the prospects of enhanced value flowing into next year.

AFRICAN PIONEER PLC

STATEMENT OF DIRECTORS’ RESPONSIBILITIES

STATEMENT AS TO THE DISCLOSURE OF INFORMATION TO THE AUDITORS

The directors are responsible for preparing the Report of the Directors and the financial statements in accordance with

applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under the law the directors have

prepared the financial statements in accordance with International Financial Reporting Standards (IFRSs) as adopted by the

European Union. Under company law the directors must not approve the financial statements unless they are satisfied that

the financial statements give a true and fair view of the state of affairs and profit or loss of the Company for that period. In

preparing these financial statements, the directors are required to:

• select suitable accounting policies and then apply them consistently;

• make judgements and accounting estimates that are reasonable and prudent;

• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company

will continue in business;

• state whether applicable IFRS’s have been followed, subject to any material departures disclosed and explained in

the financial statements.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company’s

transactions and disclose with reasonable accuracy at any time the financial position of the Company and enable them to

ensure that the financial statements comply with the Companies Act 2006 and Article 4 of the IAS Regulation. They are also

responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection

of fraud and other irregularities.

The directors confirm that:

• so far as each director is aware, there is no relevant audit information of which the Company’s auditor is unaware;

and

• the directors have taken all the steps that they ought to have taken as directors in order to make themselves aware of

any relevant audit information and establish that the auditors are aware of that information.

Legislation in the Isle of Man governing the preparation and dissemination of financial statements may differ from legislation

in other jurisdictions.

Signed on behalf of the Board:

28 April 2023

Colin Bird

Non-Executive Chairman

AFRICAN PIONEER PLC

INDEPENDENT AUDITOR’S REPORT

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF AFRICAN PIONEER PLC FOR THE

YEAR ENDED 31 DECEMBER 2022

Opinion

We have audited the financial statements of African Pioneer Plc (the ‘parent company’) and its subsidiaries (the ‘group’) for

the year ended 31 December 2022 which comprise the consolidated statement of comprehensive income, the consolidated

statement of changes in equity, the company statement of changes in equity, the consolidated statement of financial position,

the company statement of financial position, the consolidated statement of cash flows, the company statement of cash flows

and the related notes 1 to 18, including a summary of significant accounting policies. The financial reporting framework that

has been applied in their preparation is applicable law and International Financial Reporting Standards (IFRSs) as adopted

by the EU.

In our opinion, the financial statements:

• give a true and fair view of the state of the group’s and of the parent company’s affairs as at 31 December 2022

and of the group’s result for the year then ended;

• have been properly prepared in accordance with IFRSs.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our

responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial

statements section of our report. We are independent of the company in accordance with the ethical requirements that are

relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our

other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is

sufficient and appropriate to provide a basis for our opinion.

Material Uncertainty Relating to Going Concern

We draw attention to note 2 in the financial statements, which indicates that the Company and Group made a loss of

(£658,505) and (£670,871) respectively, and an operating loss is expected in the year subsequent to the year of these financial

statements. As a result the Company and Group will need to raise funding to provide additional working capital to finance

its ongoing activities. As stated in note 2, these conditions, along with other matters set forth in note 2, indicate that material

uncertainty exists that may cast significant doubt on the Company and Group’s ability to continue as a going concern.

Our audit opinion is not modified in respect of this matter.

AFRICAN PIONEER PLC

INDEPENDENT AUDITOR’S REPORT (continued)

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial

statements of the current period and include the most significant assessed risks of material misstatement (whether or not due

to fraud) we identified, including those which had the greatest effect on: the overall audit strategy, the allocation of resources

in the audit; and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the

financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these

matters.

Key audit matters

Description of the risk

How the scope of our audit

addressed the risk

Revenue recognition

There is a risk of fraud in

revenue recognition giving rise

to material misstatements in the

accounts.

Our work examined sources of

income and no evidence of

fraud or other understatement

in revenue was identified.

Risk that management is able to

override controls

Risk that inappropriate

accounting journals may be

posted giving rise to material

misstatement in the accounts.

We examined journals posted

around the year end,

specifically focusing on areas,

which are more easily

manipulated.

We identified n

o evidence of

management override in respect

of inappropriate manual

journals recorded in any section

of the financial statements.

IFRS6 Mining and Exploration

rights

Risk that mining exploration

and licensing costs are

inappropriately capitalised with

respect to the criteria set out in

IFRS 6.

Our work examined licenses

and other capitalised

expenditure to ensure it fell

within the capitalisation criteria

under IFRS6 and no evidence of

impairment was identified.

Public Limited Company listing

status

By virtue of the Company’s

listing status and its public

profile, the Company has

enhanced regulatory

supervision and therefore any

non-

compliance with such

regulations could affect the

entities ability to trade and

therefore its going concern

status

The listing regulations were

reviewed and all filings

required of the Company were

seen to have been correctly

made on time. No instance of

non-compliance was identified.

Overseas group entities

Risk that as the group has

overseas entities that the

accounting records may not be

easily obtainable.

The finance function and

controls are all centralized from

the UK, no evidence of issues

with overseas entities

identified.

AFRICAN PIONEER PLC

INDEPENDENT AUDITOR’S REPORT (continued)

Our application of materiality

In planning and performing our audit we applied the concept of materiality. An item is considered material if it could

reasonably be expected to change the economic decisions of a user of the financial statements. We used the concept of

materiality to both focus our testing and evaluate the impact of misstatements identified.

Based on our professional judgement, we determined overall materiality for the Group’s financial statements as a whole to

be £143,171. In determining this, we considered a range of benchmarks with specific focus on the net assets at the balance

sheet date. This materiality level represents 2.7% of net assets.

Based on our professional judgement, we determined overall materiality for the Parent Company’s financial statements as a

whole to be £143,171. In determining this, we considered a range of benchmarks with specific focus on the net assets at the

balance sheet date. This materiality level represents 3.4% of net assets.

We report to the Audit Committee all identified unadjusted errors in excess of £7,159. Errors below that threshold would

also be reported if, in our opinion as auditor, disclosure was required on qualitative grounds.

An overview of the scope of our audit

Our audit was scoped by obtaining an understanding of the Company and its environment, including controls, and assessing

the risks of material misstatement.

Other information

The other information comprises the information included in the annual report, other than the financial statements and our

auditor’s report thereon. The directors are responsible for the other information. Our opinion on the financial statements does

not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form

of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read the

other information and, in doing so, consider whether the other information is materially inconsistent with the financial

statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material

inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in

the financial statements or a material misstatement of the other information. If, based on the work we have performed, we

conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Opinions on other matters

In our opinion, based on the work undertaken in the course of the audit:

• the information given in the directors’ report for the financial year for which the financial statements are prepared is

consistent with the financial statements; and

• the directors’ report has been prepared in accordance with applicable legal requirements.

Matters on which we report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we

have not identified material misstatements in the directors’ report. We have nothing to report in respect of the following

matters if, in our opinion:

AFRICAN PIONEER PLC

INDEPENDENT AUDITOR’S REPORT (continued)

• adequate accounting records have not been kept, or returns adequate for our audit have not been received from

branches not visited by us; or

• the financial statements are not in agreement with the accounting records and returns; or

• certain disclosures of directors’ remuneration specified by law are not made; or

• we have not received all the information and explanations we require for our audit; or

• the directors were not entitled to prepare the financial statements in accordance with the small companies regime and

take advantage of the small companies’ exemptions in preparing the directors’ report and from the requirement to

prepare a strategic report.

Responsibilities of directors

As explained more fully in the directors’ responsibilities statement set out on page 11, the directors are responsible for the

preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control

as the directors determine is necessary to enable the preparation of financial statements that are free from material

misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing

the company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using

the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or

have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material

misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance

is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect

a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually

or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of

these financial statements.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with

our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent

to which our procedures are capable of detecting irregularities, including fraud is detailed below:

We identify and assess the risks of material misstatement contained within the financial statements, whether due to fraud or

error, and then design and perform audit procedures responsive to those risks, including obtaining audit evidence that is

sufficient and appropriate to provide a basis for our opinion.

Identifying and assessing potential risks related to irregularities

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance

with laws and regulations, we considered the following:

• the nature of the industry and sector, control environment and business performance;

• results of our enquiries of management about their own identification and assessment of the risks of irregularities;

• any matters we identified having obtained and reviewed the Company’s documentation of their policies and

procedures relating to:

• identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of

noncompliance;

AFRICAN PIONEER PLC

INDEPENDENT AUDITOR’S REPORT (continued)

• detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged

fraud;

• the internal controls established to mitigate risks of fraud or non-compliance with laws and regulations;

• the matters discussed among the audit engagement team regarding how and where fraud might occur in the financial

statements and any potential indicators of fraud.

As a result of these procedures, we considered the opportunities and incentives that may exist within the organisation for

fraud. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk

of management override.

We also obtained an understanding of the legal and regulatory frameworks that the Company operates in, focusing on

provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in

the financial statements. The key laws and regulations we considered in this context included the Isle of Man Companies Act

and local tax legislation.

Audit response to risks identified

As a result of performing the above, our procedures to respond to risks identified included the following:

• reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with

provisions of relevant laws and regulations described as having a direct effect on the financial statements;

• enquiring of management concerning actual and potential litigation and claims;

• performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of

material misstatement due to fraud;

• reading minutes of meetings of those charged with governance;

• obtained an understanding of provisions and held discussions with management to understand the basis of recognition

or non-recognition of tax provisions; and

• in addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries

and other adjustments; assessing whether the judgements made in making accounting estimates are indicative of a

potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the

normal course of business.

We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members

including internal specialists and significant component audit teams and remained alert to any indications of fraud or

noncompliance with laws and regulations throughout the audit.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting

Council’s website at:

https://www.frc.org.uk/Our-Work/Audit/Audit-and-assurance/Standards-and-guidance/Standards-and-guidance-for-

auditors/Auditors-responsibilities-for-audit/Description-of-auditors-responsibilities-for-audit.aspx This description forms

part of our auditor’s report.

Use of our report

This report is made solely to the company’s members, as a body. Our audit work has been undertaken so that we might state

to the company’s members those matters we are required to state in an auditor’s report and for no other purpose. To the

fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the

company’s members, as a body, for our audit work, for this report, or for the opinion we have formed.

AFRICAN PIONEER PLC

INDEPENDENT AUDITOR’S REPORT (continued)

Robert Wood (Senior Statutory Auditor)

For and on behalf of

Shipleys LLP

Chartered Accountants & statutory auditor

10 Orange Street

Haymarket

London

WC2H 7DQ

Date: 28 April 2023

AFRICAN PIONEER PLC

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

For the year ended 31 December 2022

Notes

Year ended 31

December 2022

Year ended 31 December

2021

Restated

CONTINUING OPERATIONS

Income:

Option fees received re licenses

668,599

Interest receivable

Dividend receivable

2,951

691

Realised gain on sale of investments

4,320

Unrealised gain on investments

(78,197)

100,391

Total Income

Administrative expenses

(70,926)

769,681

Administrative expenses

(599,965)

(291,690)

Listing related costs

(79,925)

Mining licenses and rights

Total Administrative Expense

(599,965)

(371,615)

OPERATING (LOSS)/PROFITFOR THE

YEAR

(670,891)

398,066

Interest expense

(2,373)

Interest income

(LOSS)/PROFIT BEFORE TAX

(670,871)

395,693

Taxation

(122,222)

NET (LOSS)/PROFIT FOR THE YEAR

(670,871)

273,471

Other comprehensive income:

Other comprehensive income

(Loss)/Profit for the financial year

Items that may be reclassified to profit

or loss:

Foreign currency reserve movement

(32,256)

34,339

Total comprehensive (loss)/profit for the

financial year

(703,127)

307,810

Attributable to:

Owners of the Company

(703,127)

307,810

Non-controlling interest

(703,127)

307,810

Basic loss per share

(0.35) p

0.24 p

Diluted loss per share

(0.29) p

0.20p

All results are derived from continuing

operations.

AFRICAN PIONEER PLC

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

As at 31 December 2022

Notes

Year ended 31

December 2022

Year ended 31 December

2021

Restated

NON-CURRENT ASSETS

Exploration and evaluation

assets

5,112,856

4,432,962

Total Non-Current Assets

5,112,856

4,432,962

CURRENT ASSETS

Trade and other receivables

11,023

21,722

Cash and cash equivalents

71,674

1,190,979

Available-for-sale

investments

395,750

502,456

Total Current Assets

478,447

1,715,157

TOTAL ASSETS

5,591,303

6,148,119

CURRENT LIABILITIES

Trade and other payables

(230,260)

(83,949)

Taxation

(122,222)

Total Current Liabilities

(352,482)

(206,171)

NET CURRENT

(LIABILITIES) / ASSETS

125,965

1,508,986

NON-CURRENT

LIABILITIES

Loans

13(i)

Total Non-Current

Liabilities

TOTAL LIABILITIES

(352,482)

(206,171)

NET ASSETS

5,238,820

5,941,948

EQUITY

Share capital

5,475,204

5,490,271

Warrant reserve

23,901

8,834

Foreign exchange reserve

2,083

34,339

Retained earnings

(949,716)

(278,845)

4,551,472

5,254,600

Non controlling interest

687,348

TOTAL EQUITY

5,238,820

5,941,948

The notes on pages 48-66 are an integral part of these financial statements.

The financial statements of African Pioneer Plc (registered number 008591V) were approved by the board on 28 April

2023 and signed on its behalf by:

C Bird R Samtani

Non-Executive Chairman Director

AFRICAN PIONEER PLC

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the year ended 31 December 2022

capital

Capital

contribution

Retained

earnings

Restated

Foreign

exchange

reserve

Warrant

reserve

Non

Controlling

interest

Total

equity

Restated

As at 1 January 2021

452,983

186,446

(552,315)

87,114

Net proceeds from shares

issued

2,030, 877

Acquisition of subsidiaries

2,962, 500

Acquisition of additional

15% of Manmar subsidiaries

52,745

Loan notes converted into

(186,446)

Profit for the year

273,470

34,339

307,809

Share based payment charge

(8,834)

8,834

Non-controlling interests on

acquisition of subsidiary

687,348

As at 31 December 2021

Restated

5,490,271

(278,845)

34,339

8,834

687,348

5,941,947

As at 1 January 2022

5,490,271

(278,845)

34,339

8,834

687,348

5,941,947

Profit / (Loss) for the year

(670,871)

(32,256)

(703,127)

Share based payment charge

(15,067)

15,067

Non-controlling interests on

acquisition of subsidiary

As at 31 December 2022

5,475,204

(949,716)

2,083

23,901

687,348

5,238,820

The notes on pages 46-66 are an integral part of these financial statements.

AFRICAN PIONEER PLC

CONSOLIDATED STATEMENT OF CASH FLOWS

For the year ended 31 December 2022

Notes

Year ended

December

2022

Year ended

December

2021

Restated

CASH FLOW FROM OPERATIONS

Profit/(Loss) before taxation

(670,871)

273,470

Adjustments for:

Interest received

Dividends received

(2,951)

(691)

(Gain) on disposal of investment shares

(4,320)

Loss/(Gain) in fair value of investment at reporting date

78,197

(100,391)

Interest expense

Operating (loss) before movements in working capital

(599,945)

172,389

Decrease/(Increase in receivables)

10,699

(21,302)

Increase in payables

146,311

155,441

NET CASH OUTFLOW FROM OPERATING ACTIVITIES

(442,935)

306,528

TAXATION PAID

CASH FLOW FROM INVESTING ACTIVITIES

Interest received

Dividends received

2,951

691

Investments purchased

(302,960)

Investments sold

32,829

Purchases of Exploration and evaluation assets

(679,894)

(303,206)

Purchase of Exploration and Evaluation

assets on Acquisition of subsidiaries

(427,163)

NET CASH INFLOW FROM INVESTING ACTIVITIES

(644,114)

(1,032,638)

CASH FLOW FROM FINANCING ACTIVITIES

Issue of convertible loan notes

Proceeds from Issue of shares, net of issue costs

1,844,431

Loan repayment

(49,143)

NET CASH INFLOW FROM FINANCING ACTIVITIES

1,795,288

Net increase/(decrease) in cash and cash equivalents in the period

1,087,049

1,069,178

Effect of foreign exchange rate changes

(32,256)

34,339

Cash and cash equivalents at the beginning of the period

1,190,979

87,462

Cash and cash equivalents at the end of the period

71,674

1,190,979

The notes on pages 48-66are an integral part of these financial statements.

AFRICAN PIONEER PLC

COMPANY STATEMENT OF FINANCIAL POSITION

As at 31 December 2022

Notes

31 December 2022

31 December 2021

Restated

NON-CURRENT

ASSETS

Investment in

subsidiaries

2,796,500

Total Non-Current

Assets

2,796,500

CURRENT ASSETS

Trade and other

receivables

1,557,828

866,342

Cash and cash

equivalents

71,664

1,190,969

Available-for-sale

investments

395,750

502,456

Total Current Assets

2,025,242

2,559,767

TOTAL ASSETS

4,821,742

5,356,267

CURRENT

LIABILITIES

Trade and other

payables

(689,809)

(565,829)

Total Current

Liabilities

(689,809)

(565,829)

NET CURRENT

ASSETS /

(LIABILITIES)

1,335,433

1,993,938

NON-CURRENT

LIABILITIES

Loans

13(i)

Total Non-Current

Liabilities

TOTAL

LIABILITIES

(689,809)

(565,829)

NET ASSETS

4,131,933

4,790,438

EQUITY

Share capital

5,475,204

5,490,271

Warrant reserve

23,901

8,834

Retained earnings

(1,367,172)

(708,667)

TOTAL EQUITY

4,131,933

4,790,438

The notes on pages 46-66 are an integral part of these financial statements.

The financial statements of African Pioneer Plc (registered number 008591V) were approved by the board on 28 April

2023 and signed on its behalf by:

C Bird R Samtani

Non-Executive Chairman Director

AFRICAN PIONEER PLC

COMPANY STATEMENT OF CHANGES IN EQUITY

For the year ended 31 December 2022

Share capital

Capital

contribution

Retained

earnings

Restated

Warrant

reserve

Total

equity

Restated

As at 1 January 2021

452,983

186,446

(552,315)

87,114

Net proceeds from shares issued

2,030,877

Acquisition of subsidiaries

2,962,500

Acquisition of additional 15% of

Manmar subsidiaries

52,745

Loan notes converted into shares

(186,446)

Share based payment charge

(8,834)

8,834

Loss for the year

(156,352)

As at 31 December 2021

(Restated)

5,490,271

(708,667)

8,834

4,790,438

As at 1 January 2022

5,490,271

(708,667)

8,834

4,790,438

Share based payment charge

(15,067)

15,067

(Loss) for the year

(658,505)

As at 31 December 2022

5,475,204

(1,367,172)

23,901

4,131,933

The notes on pages 46-66 are an integral part of these financial statements.

AFRICAN PIONEER PLC

COMPANY STATEMENT OF CASH FLOWS

For the year ended 31 December 2022

Notes

Year ended

December

2022

Year ended

December

2021

Restated

CASH FLOW FROM OPERATIONS

Profit/(Loss) before taxation

(658,505)

(156,352)

Adjustments for:

Interest received

Dividends received

(2,951)

(691)

(Gain) on disposal of investment shares

(4,320)

Loss/(Gain) in fair value of investment at reporting date

78,197

(100,391)

Interest expense

Operating (loss) before movements in working capital

(587,579)

(257,434)

Decrease/(Increase) in receivables

10,699

(20,559)

Increase/(decrease) in payables

146,305

(8,258)

Increase / (decrease) in loans to subsidiaries

(724,510)

325,383

NET CASH OUTFLOW FROM OPERATING ACTIVITIES

(1,155,085)

39,132

TAXATION PAID

CASH FLOW FROM INVESTING ACTIVITIES

Interest received

Dividends received

2,951

691

Investments purchased

(302,960)

Investments sold

32,829

Acquisition of subsidiaries

(428,644)

NET CASH INFLOW FROM INVESTING ACTIVITIES

35,780

(730,913)

CASH FLOW FROM FINANCING ACTIVITIES

Issue of convertible loan notes

Proceeds from Issue of shares, net of issue costs

1,844,431

Loan repayment

(49,143)

NET CASH INFLOW FROM FINANCING ACTIVITIES

1,795,288

Net increase/(decrease) in cash and cash equivalents in the period

1,119,305

1,103,507

Cash and cash equivalents at the beginning of the period

1,190,969

87,462

Cash and cash equivalents at the end of the period

71,664

1,190,969

The notes on pages 46-66 are an integral part of these financial statements.

AFRICAN PIONEER PLC

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

1. GENERAL INFORMATION

This financial information is for African Pioneer Plc (“the Company”) and its subsidiary undertakings. The principal

activity of African Pioneer Plc (the ‘Company’) and its subsidiaries (together the ‘Group’) is the development of natural

resources exploration projects in Sub-Saharan Africa.

The Company is a public limited company and was listed on to the Official List (Standard Segment) and commenced

trading on the Main Market for listed securities of the London Stock Exchange on 1 June 2021. The Company is domiciled

in the Isle of Man and was incorporated on 20th July 2012 under the Isle of Man Companies Act 2006 with company

registration number 00859IV, and with registered address being 34 North Quay, Douglas, Isle of Man, IM1 4LB.

ACCOUNTING POLICIES

Basis of preparation

The financial statements have been prepared under the historical cost convention except for the measurement of certain

non-current asset investments at fair value. The measurement basis and principal accounting policies of the Group are set

out below. The financial statements have been prepared in accordance with International Financial Reporting Standards

(IFRS) issued by the International Accounting Standards Board (IASB) and endorsed by the European Union.

New and amended IFRS Standards that are effective for the current year

A number of new standards and interpretations have been adopted by the Group for the first time in line with their

mandatory adoption dates, but none are applicable to the Group and hence there would be no impact on the financial

statements.

New and revised IFRS Standards in issue but not yet effective

At the date of approval of these financial statements, the Group has not applied the following new and revised IFRS

Standards that have been issued but are not yet effective:

IFRS 17 (including the June

2020 amendments to IFRS

17)

Insurance Contracts

IFRS 10 and IAS 28

(amendments)

Sale or Contribution of Assets between an Investor and its Associate or Joint

Venture

Amendment to IFRS 16

Covid rent concessions

IFRS 3

Conceptual framework

Amendments to IAS 1

Classification of Liabilities as Current or Non-current

Amendments to IFRS 3

Reference to the Conceptual Framework

Amendments to IAS 16

Property, Plant and Equipment—Proceeds before Intended Use

Amendments to IAS 1 and

IFRS

Practice Statement 2

Disclosure of Accounting Policies

Amendments to IAS 8

Definition of Accounting Estimates

Amendments to IAS 12

Deferred Tax related to Assets and Liabilities arising from a Single Transaction

Amendments to IAS1

Non-current liabilities with covenants

Amendments to IFRS 16

Lease liability sale & leaseback

AFRICAN PIONEER PLC

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022 (continued)

2. ACCOUNTING POLICIES (continued)

The directors do not expect that the adoption of the Standards listed above will have a material impact on the financial

statements of the Company in future periods.

Basis of consolidation

The consolidated financial statements incorporate the financial statements of the Company and entities controlled by the

Company (its subsidiaries). Control is achieved where the Company has power over the investee, is exposed or has rights

to variable returns from its involvement with the investee and has the ability to use its power to affect its returns.

The results of subsidiaries acquired or disposed of are included in the consolidated Statement of Comprehensive Income

from the effective date of acquisition or up to the effective date of disposal, as appropriate.

Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used

in line with those used by other members of the Group.

All intragroup assets and liabilities, equity, income, expenses, and cash flows relating to transactions between members

of the Group are eliminated in full on consolidation.

Profits/(losses) attributable to non-controlling interests are shown separately in the Statement of Comprehensive income

and the portion of net assets attributable to non-controlling interest is shown on the Statement of Financial Position.

Going concern

The Group made a loss from all operations for the year ended 31 December 2022 after tax of £(670,871) (2021: restated

profit of £273,471), On 2 October 2021 the Company entered into a two-year option agreement with ASX listed Sandfire

Resources Limited in relation to 4 of its 8 Botswana prospecting licences whereby the Company received a cash payment

amounting to US$500,000 plus 107,272 Sandfire Resources Limited shares as part of the agreement with Sandfire. As a

result of the option fee received, the Company made a profit for the year to 31 December 2021. During 2021, the Company

raised £1,750,000 at the time of its Listing on 1 June 2021and £365,000 by way of a share subscription from Sandfire

Resources Limited. Cash and cash equivalents were £71.7k as at 31 December 2022 and the Company had available for

sale investments at 31 December 2022 of £396K. An operating loss is expected in the year subsequent to the date of these

accounts and as a result the Company will need to raise funding to provide additional working capital to finance its

ongoing activities. The management team has successfully raised funding for exploration projects in the past, but there is

no guarantee that adequate funds will be available when needed in the future.

Based on its current reserves and the Board's assessment that the Company will be able to raise additional funds, as and

when required, to meet its working capital and capital expenditure requirements, the Board have concluded that they have

a reasonable expectation that the Group can continue in operational existence for the foreseeable future. For these reasons

the financial statements have been prepared on the going concern basis, which contemplates continuity of normal business

activities and the realisation of assets and discharge of liabilities in the normal course of business.

The management team has successfully raised funding for exploration projects in the past, but there is no guarantee that

adequate funds will be available when needed in the future.

There is a material uncertainty relating to the conditions above that may cast significant doubt on the Group's ability to

continue as a going concern and therefore the Group may be unable to realise its assets and discharge its liabilities in the

normal course of business.

AFRICAN PIONEER PLC

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022 (continued)

2. ACCOUNTING POLICIES (continued)

This financial report does not include any adjustments relating to the recoverability and classification of recorded assets

amounts or liabilities that might be necessary should the entity not continue as a going concern.

Exploration assets accounting policy

The Company’s exploration assets accounting policy is in line with IFRS6. Exploration, evaluation and development

expenditure incurred is accumulated in respect of each identifiable area of interest. These costs are only carried forward

to the extent that they are expected to be recouped through the successful development of the area or where activities in

the area have not yet reached a stage which permits reasonable assessment of the existence of economically recoverable

reserves. Accumulated costs in relation to an abandoned area are written off in full in the year in which the decision to

abandon the area is made. When production commences, the accumulated costs for the relevant area of interest are

transferred to development assets and amortised over the life of the area according to the rate of depletion of the

economically recoverable reserves. A regular review is undertaken of each area of interest to determine the

appropriateness of continuing to carry forward costs in relation to that area of interest.

Valuation of investments

The company has adopted the provisions of IFRS9 and has elected to treat all available for sale investments at fair value

with changes through the profit and loss.

Available-for-sale investments under IFRS9 are initially measured at fair value plus incidental acquisition costs.

Subsequently, they are measured at fair value in accordance with IFRS 13. This is either the bid price or the last traded

price, depending on the convention of the exchange on which the investment is quoted. All gains and losses are taken to

profit and loss.

Equity and reserves

An equity instrument is any contract that evidences a residual interest in the assets of a company after deducting all of

its liabilities. Equity instruments issued are recorded at the proceeds received net of direct issue costs.

Share capital represents the amount subscribed for shares with no par nominal value. Any transaction costs associated

with the issuing of shares are deducted from share capital, net of any related income tax benefits.

Foreign exchange reserve - amounts arising on re-translating the net assets of overseas operations into the presentational

currency

The capital contribution reserve represents the value of the equity component of loans made from parent undertakings.

The warrant reserve presents the proceeds from issuance of warrants, net of issue costs. Warrant reserve is non-

distributable and will be transferred to share capital account and accumulated losses upon exercise of warrants. Shares

to be issued reserve arises on the timing difference between the Company making a commitment to issue shares and the

shares being issued. Once the shares are issued a transfer is made to the share capital account. Accumulated losses

include all current and prior period results as disclosed in the statement of comprehensive income, less dividends paid

to the owners of the parent.

AFRICAN PIONEER PLC

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022 (continued)

2. ACCOUNTING POLICIES (continued)

Significant management judgement in applying accounting policies and estimation uncertainty

When preparing the financial statements, management makes a number of judgements, estimates and assumptions

about the recognition and measurement of assets, liabilities, income and expenses.

Functional and presentational currency

The presentation and functional currency of the Company is Sterling.

Expenses

All expenses are accounted for on an accruals basis. Expenses are charged to the statement of comprehensive income

except for expenses incurred on the acquisition of an investment, which are included within the cost of that investment,

expenses arising on the disposal of investments are deducted from the disposal proceeds.

Cash and cash equivalents

This consists of cash held in the Company’s bank account.

Financial liabilities

The Company has financial liabilities consisting of trade payables and accrued expenses which are non-derivative

financial liabilities recognised at amortised cost.

Taxation

The Company is subject to tax in the Isle of Man in the period at a rate of 0% and accordingly, interest and gains

payable to the Company are received by the Company without any deduction relating to Isle of Man taxed. and during

the period the Company had no income subject to taxation in other jurisdictions, As per Note 16 the Company has

made a prior year adjustment in respect of provision for tax due by a subsidiary of £122,222.

Earnings per share

The earnings per share are calculated by dividing the net result attributed to the equity shareholders by the weighted

average number of participating shares in issue in the period.

Geographical segments

A segment is a distinguishable component of the Company that is engaged either in providing products or services

(business segment) or in providing products or services within a particular economic environment (geographical

segment), which is subject to risk and rewards that are different from those of other segments. The internal management

reporting used by the chief operating decision maker consists of one segment. Hence in the opinion of the directors,

no separate disclosures are required under IFRS 8. The Company’s revenue in the year is not material and consequently

no geographical segment information has been disclosed.

AFRICAN PIONEER PLC

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022 (continued)

ACCOUNTING POLICIES (continued)

Critical accounting estimates and judgements

The preparation of the Group’s financial statements under IFRS requires the Directors to make estimates and

assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and

liabilities. Estimates and judgements are continually evaluated and are based on historical experience and other factors

including expectations of future events that are believed to be reasonable under the circumstances. Actual results may

differ from these estimates.

Details of the Group’s significant accounting judgements used in the preparation of these financial statements include:

Recoverability of intangible exploration and evaluation assets

Where a project is sufficiently advanced, the recoverability of intangible exploration and evaluation assets is assessed

by comparing the carrying value to internal and operator estimates of the net present value of projects. Intangible

exploration assets are inherently judgemental to value. The amounts for intangible exploration and evaluation assets

represent active exploration projects. These amounts will be written-off to the profit and loss as exploration costs unless

commercial reserves are established, or the determination process is completed and there are no indications of

impairment. The carrying value of exploration assets in the consolidated financial statements as at 31 December 2022

is £5,112,856. The recoverability of this carrying value, and thus potential impairment, requires use of significant

judgments and estimates. The details of these assets are outlined in note 10.

Recoverability of investment in subsidiaries and intragroup receivables

In the Company financial statements, the carrying value of the Company’s investment in subsidiaries and intragroup

receivables is £4,344,048. The recoverability of this balance is driven by the same judgements and uncertainties as the

recoverability of the exploration and evaluation assets held by the subsidiaries.

Valuation of share-based payments

Equity-settled share-based payment transactions with parties other than employees are measured at the fair value of

the goods or services received, except where that fair value cannot be estimated reliably, in which case they are

measured at the fair value of the equity instruments granted, measured at the date the entity obtains the goods or the

counterparty renders the service. The share-based payment expense is recognised as deduction in share capital. A

corresponding increase in the warrant reserve is also recognised

The fair value of these payments is calculated by the

Company using the Black Scholes option pricing model.

The model requires the Directors to make assumptions

regarding the share price volatility, risk free rate and expected life of awards in order to determine the fair values of

the awards at grant dates.

3. FINANCIAL RISK MANAGEMENT

The Company’s objective is to achieve capital growth through investing in selection of equity and other instruments.

The Company’s financial instruments comprise:

• Available-for-sale investments

• Cash, short-term receivables and payables

Throughout the period under review, it was the Company’s policy that no trading in derivatives shall be undertaken.

The main financial risks arising from the Company’s financial instruments are market price risk and liquidity risk. The

AFRICAN PIONEER PLC

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022 (continued)

3. FINANCIAL RISK MANAGEMENT (continued)

Board regularly reviews and agrees policies for managing each of these risks and they are summarised below. These

policies have remained constant throughout the period.

Market risk

Market risk consists of interest rate risk, foreign currency risk and other price risk. There are no foreign currency

exposures. Hence, no foreign currency risk. It is the Board’s policy to maintain an appropriate spread of investments

in the portfolio whilst maintaining the investment policy and aims of the Company. The Investment Committee actively

monitors market prices and other relevant information throughout the year and reports to the Board, who is ultimately

responsible for the Company’s investment policy.

Interest rate risk

Changes in interest rates would affect the Company returns from its cash balances. A floating rate of interest, which is

linked to bank base rates, is earned on cash deposits. The exposure to cash flow interest rate risk at 31 December 2022

for the Company was £71,674 (2021: £1,190,969). As the Company does not have any borrowings and finances its

operations through its share capital and retained revenues, it does not have any interest rate risk except in relation to

cash balances.

Other price risk

Other price risk which comprises changes in market prices other than those arising from interest rate risk or currency

risk may affect the value of quoted and unquoted equity investments. The Board of directors manages the market price

risks inherent in the investment portfolio by regularly monitoring price movements and other relevant market

information. The Company accounts for movements in the fair value of its available-for-sale financial assets in other

comprehensive income. A 5% change in prices of investments would result in increase/(decrease) of £19,780 in value

of investments (2021: £25,123).

Liquidity risk

The Company maintains appropriate cash reserves and the majority of the Company’s assets comprise of realisable

securities, most of which can be sold to meet funding requirements, if necessary. Given the Company’s cash reserves,

it has been able to settle all liabilities on average within 1 month. Given the current level of cash resources the liquidity

risk is not considered to be material.

Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to

meet its contractual obligations.

The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit

risk as at 31 December 2022 is detailed below:

For the Group, credit risk arises primarily from cash balances held at banks. The risk is mitigated by using only

reputable financial institutions with a high credit rating.

AFRICAN PIONEER PLC

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022 (continued)

3. FINANCIAL RISK MANAGEMENT (continued)

The Company is additionally exposed to credit risk on the intercompany balances with its subsidiaries. The

recoverability of these balances is linked directly to the success of the exploration activities of the Group.

As discussed in note 10, no impairment indicators exist on the exploration assets and thus the balances are deemed to

be recoverable. The Company and Group do not hold any collateral as security

The credit rating bands are provided by independent ratings agencies:

As at 31 December 2022

Not rated /not

readily available

Total

Cash and cash equivalents

71,674

Total assets subject to credit risk

71,674

As at 31 December 2021

Not rated /not

readily available

Total

Cash and cash equivalents

1,190,969

Total assets subject to credit risk

1,190,969

Financial liabilities

There are no currency or interest rate risk exposures on financial liabilities as they are denominated in £ Sterling.

Capital management

The Company actively reviews its issued share capital and reserves and manages its capital requirements in order to

maintain an efficient overall financing structure whilst avoiding any leverage.

EXPENSES BY NATURE

31 December 2022

31 December 2021

Directors’ fees

(172,404)

(106,469)

Audit fees

(49,200)

(32,220)

Stock exchange related costs

(52,073)

(14,813)

Legal, professional and consultancy fees

(96,319)

(39,359)

Consultancy fees

(106,500)

(25,000)

Management services

(10,800)

(11,800)

Insurance

(20,146)

(14,521)

Other administration expenses

(46,784)

(13,321)

Travel

(7,999)

Investor relations

(37,740)

(34,187)

Total Expense

(599,965)

(291,690)

31 December 2022

31 December 2021

Auditor’s remuneration

- Audit of the financial statements of the Company

49,200

32,220

AFRICAN PIONEER PLC

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022 (continued)

DIRECTORS’ EMOLUMENTS

Other than directors, there were no employees or key management personnel in the year.

31 December

2022

31 December

2021

Colin Bird

60,000

35,000

Raju Samtani

50,004

29,169

Christian Cordier

30,000

16,500

Kjeld Thygesen

18,000

16,500

James Cunningham-Davis

14,400

9,300

Total

172,404

106,469

The emoluments paid to the directors relate to both the Company and the Group

2022

2021

Number

Directors

Consultants

The average monthly number of employees

6. EARNINGS PER SHARE

31 December 2022

31 December 2021

Restated

Profit/(Loss) after tax for the purposes of earnings

per share attributable to equity shareholders

£(670,871)

£273,471

Weighted average number of shares

191,707,845

116,222,201

Weighted average number of shares and warrants

229,430,224

138,235,532

Basic profit/(loss) per ordinary share

(0.35) p

0.24 p

Diluted profit per ordinary share

(0.29) p

0.20 p

The use of the weighted average number of shares in issue in the period recognises the variations in the number of

shares throughout the period and is in accordance with IAS 33.

7. TAXATION

The Company is subject to Isle of Man income tax at 0%, and during the period had no income subject to taxation in

other jurisdictions, and has no capital allowances or deferred tax implications. Accordingly, the Directors have made

no provision for taxation charges or liabilities for the period and have not presented the formal reconciliation required

under IAS 12. As per Note 16 the Company has made a prior year adjustment in respect of provision for tax due by a

subsidiary of £122,222.

AFRICAN PIONEER PLC

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022 (continued)

8. AVAILABLE FOR SALE INVESTMENTS

Group & Company

31 December 2022

31 December 2021

Investments at fair value at 1 January

502,456

99,105

Additions

302,960

Disposals

(28,509)

Movements in fair value

(78,197)

100,391

Investments at fair value at 31 December

395,750

502,456

The book cost of the investments at 31 December 2022 was £381,541 (2021: £410,050).

The Company’s intention following its Listing is not to purchase any new investments and to hold its residual

portfolio as realisable investments as a source of liquidity to cover explorations costs and general overheads of the

Company.

Financial instruments measured at fair value

The following table presents financial assets and liabilities measured at fair value in the statement of financial position in

accordance with the fair value hierarchy. This hierarchy groups financial assets and liabilities into three levels based on

the significance of inputs used in measuring the fair value of the financial assets and liabilities. The fair value hierarchy

has the following levels:

− Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities;

− Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability,

either directly (i.e., as prices) or indirectly (i.e., derived from prices); and

− Level 3: inputs for the asset or liability that are not based on observable market data (unobserved inputs).

The level within which the financial asset or liability is classified is determined based on the lowest level of significant

input to the fair value measurement.

The financial assets and liabilities measured at fair value in the statement of financial position are grouped into the fair

value hierarchy as follows:

31 December 2022

Level 1

Level 2

Level 3

Total

Assets

395,750

Total

395,750

31 December 2021

Level 1

Level 2

Level 3

Total

Assets

502,456

Total

502,456

AFRICAN PIONEER PLC

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022 (continued)

9. ACQUISITION OF SUBSIDIARIES

Acquisition of Zamcu Exploration Pty Limited (Namibian Projects)

On 1 June 2021 the Company completed the acquisition of 100% of Zamcu Exploration Pty Ltd (“Zamcu”),

which via its subsidiaries, held a 70 per cent. interest in two Namibian Exclusive Prospecting Licenses (“EPLs”)

comprising the Ongombo and Ongeama projects, located within the Matchless amphibolite Belt of central

Namibia that hosts copper-gold mineralisation. On 27 August 2021 the Company entered into an agreement to

acquire a further 15% interest in its Ongombo Project and Ongeama Project in Namibian (the “Namibian

Projects”) increasing its interest in the Namibian Projects to 85% (see note 10)

The fair value of the assets and liabilities acquired were as follows:

Consideration

Equity consideration

- Ordinary shares (issued)

687,500

Cash consideration

149,149

836,649

Fair value of assets and liabilities acquired

- Assets

- Liabilities

(262)

Deemed fair value of

exploration assets acquired

836,911

Additional 15% acquired

331,240

Total 85% acquisition value

1,168,151

Attributable to non-controlling interest

206,098

Gross fair value of exploration assets acquired

1,374,249

Acquisition of African Pioneer Zambia Limited (“APZ”) (Zambia Projects)

On 1 June 2021 the Company completed the acquisition of 80% of APZ, which holds a 100 per cent. interest

in five Zambian Prospecting Licenses (PLs) located in two areas namely (i) the Central Africa Copperbelt

(Copperbelt), which is the largest and most prolific mineralized sediment- hosted copper province known on

Earth and which comprises four PLs and (ii) the Zambezi area located within the Zambezi Belt of southern

Zambia that hosts a lower Katanga Supergroup succession which, although less studied than its northern

counterpart, also hosts a number of Copperbelt-style occurrences and which comprises one PL

AFRICAN PIONEER PLC

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022 (continued)

9. ACQUISITION OF SUBSIDIARIES (Continued)

The fair value of the assets and liabilities acquired were as follows:

Ordinary shares (issued)

1,925,000

Fair value of assets and liabilities acquired

- Assets

743

- Loan for exploration licenses

(41,205)

(40,462)

Deemed fair value of

- exploration assets acquired

1,965,462

Attributable to non-controlling interest

481,250

Gross fair value of exploration assets acquired

2,446,712

Resource Capital Partners Pty Ltd (“RCP”) (Botswana Projects)

On 1 June 2021 the Company completed the acquisition of 100% of Resource Capital Partners Pty Ltd

(“RCP”), which holds a 100 per cent. interest in eight Botswana Prospecting Licenses (“PLs”) located in

two areas namely (i) the Kalahari Copperbelt (KC) that contains copper-silver mineralisation and which is

generally stratabound and hosted in metasedimentary rocks that have been folded, faulted and

metamorphosed to greenschist facies during the Damara Orogeny and which comprises six PLs and (ii) the

Limpopo Mobile Belt (“Limpopo”) set within the Motloutse Complex of eastern Botswana, a transitional

boundary between the Zimbabwe Craton to the north and the Limpopo Mobile Belt to the south which

comprises two Pls;

The fair value of the assets and liabilities acquired were as follows:

Consideration

Equity consideration

- Ordinary shares (issued)

350,000

Fair value of assets and liabilities acquired

- Assets

- Liabilities

Deemed fair value of

exploration assets acquired

350,000

AFRICAN PIONEER PLC

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022 (continued)

10. EXPLORATION AND EVALUATION ASSETS

Group

Company

Group

Company

Exploration and

evaluation assets Investment in

subsidiary

Exploration and

evaluation

assets

Investment

in subsidiary

31 December

2022

31 December

2022

31 December

2021

31 December

2021

Balance at beginning of period

4,432,962-

2,796,500

Acquisitions during the period

- Namibia Projects (note 9)

1,374,249

521,500

- Zambia Projects (note 9)

2,446,712

1,925,000

- Botswana Projects (note 9)

350,000

Exploration expenditure

679,894

262,001

Carried forward

at end of year

5,112,856 2,796,500

4,432,962

2,796,500

Investments in subsidiaries are recorded at cost, which is the fair value of the consideration paid less impairment.

The Company conducted an impairment review and is satisfied that the carrying value of £2,796,500 is reasonable

and no impairment is necessary. (2021- Nil).

The Company’s principal business is to explore opportunities within the natural resources sector in Sub-Saharan Africa, with

a focus on base and precious metals including but not limited to copper, nickel, lead and zinc. The Company acquired the

Namibia Projects, Zambia Projects and Botswana Projects in 2021 (see Note 9 for details):

No current JORC 2012 compliant Mineral Resources exist for the Zambia and Botswana Projects and no Mineral Reserve

estimates have been completed for the Zambia and Botswana Projects.

The Company’s’ main focus following Admission is on evaluating and advancing the Namibian and Zambian Projects as the

Botswana Projects are the subject of option agreements .

AFRICAN PIONEER PLC

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022 (continued)

10. EXPLORATION AND EVALUATION ASSETS (continued)

Principal Subsidiaries

Name & registered office address

Country of

incorporation

and residence

Nature of

business

Proportion

of equity

shares held

by Company

Resource Capital Partners Pty Ltd

Plot 102, Unit 13

Gaborone International Commerce Park,

Gaborone, Botswana

Botswana

Base

Metals

Exploration

100%

African Pioneer Zambia Ltd

Plot No397/0/1

Chipwenupwenu Road

Makeni, Lusaka

PO Box 34033, Zambia

Zambia

Base

Metals

Exploration

80%

Zamcu Exploration Pty Ltd

5 Eze Terrace

Hillarys

WA, 6025

AUSTRALIA

Australia

Holding

Company

100%

Manmar investments one hundred and twenty nine

Pty Ltd

36 Simeon Kambo Shixungileni Street,

Windhoek, Namibia

Namibia

Base

Metals

Exploration

85% via

Zamcu

Manmar investments one hundred and thirty six Pty

Ltd

36 Simeon Kambo Shixungileni Street,

Windhoek, Namibia

Namibia

Base

Metals

Exploration

85% via

Zamcu

11. TRADE AND OTHER RECEIVABLES

Group

Company

Group

Company

31 December

2022

31 December

2022

31 December

2021

31 December

2021

Restated

Loans to subsidiaries *

1,547,548

845,363

Prepayments

10,280

20,979

Other debtors

743

Total

11,023

1,557,828

21,722

866,342

* Loans to subsidiaries are interest free and payable on demand.

Group Receivables and other current assets are all due within one year. The fair value of all receivables is the same

as their carrying values stated above.

AFRICAN PIONEER PLC

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022 (continued)

12. TRADE AND OTHER PAYABLES

Group

Company

Group

Company

31 December

2022

31 December

2022

31 December

2021

31 December

2021

Restated

Creditors

138,510

4,846

Accrued expenses

50,267

37,626

Loans from subsidiaries

501,032

523,357

Other creditors

278

272

Loan from directors

41,205

Total

230,460

689,809

83,949

565,829

Carrying amounts of trade and other payables approximate their fair value.

13. LOANS

All outstanding convertible loan amounts were settled in the prior year.

14. CALLED UP SHARE CAPITAL

The share capital of African Pioneer Plc consists only of fully paid ordinary shares with no par value. All shares are

equally eligible to receive dividends and the repayment of capital and represent one vote at shareholders’ meetings of

the Company.

Number

Authorised:

1,000,000,000 ordinary shares of no par value

1,000,000,000

n/a

2022

2021

Issued equity share

capital

Number

Issued and fully paid

Ordinary shares

191,707,845

5,946,610

191,707,845

5,946,610

Group and Company

Number of

capital

As at 1 January 2022

191,707,849

5,490,271

Shares issued during the period

Share issue costs *

Share based payment charge

(15,067)

As at 31 December 2022

191,707,849

5,475,204

AFRICAN PIONEER PLC

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022 (continued)

14. CALLED UP SHARE CAPITAL (continued)

25,000,000 two year warrants were issued to the placees on 1 June 2021 exercisable at 5.25p per ordinary share

8,571,428 three year warrants were issued to Sanderson Capital LLP on 1 June 2021 exercisable at 3.5p per ordinary

A further 4,150,947 warrants were issued on 1 June 2021 for services carried out as detailed in note 15.

15. WARRANTS AND SHARE BASED PAYMENT

On 1 June 2021 the Company granted the following warrants for services carried out in relation to the listing of the

Company on 1 June 2021 on the Standard Listing on the Official List trading on the Main Market of the London

Stock Exchange.

Number

Date

granted

Exercise

price

Expiry

Vesting conditions

Novum Securities Ltd

2,500,000

01/06/2021

3.5p

1 June 24

upon being granted

Quantum Capital and

Consulting Ltd

1,420,947

01/06/2021

3.5p

1 June 24

upon being granted

Cavendish Trust

230,000

01/06/2021

3.5p

1 June 23

upon being granted

4,150,947

As a result of this the fair value of the share options was determined at the date of the grant using the Black Scholes

model, using the following inputs:

Share price at the date of amendment 3.5p

Strike price 3.5p

Volatility

50%

Expected life 2/3 years

Risk free rate 0.17%

The 50% volatility rate is based on the average volatility from historical data in this sector

The share-based payment charge for these warrants for the year to 31 December 2022 was £15,067, which has been taken

to the share-based payment reserve and the resultant fair value of the warrants as at 31 December 2022 was determined

to be £23,901 (2021: £8,834).

16. PRIOR PERIOD ADJUSTMENT

The Company is restating it's statement of Comprehensive Income and Financial Position as at 31st December 2021

as during this period the Company’s income was overstated by £555,556 and the Group’s net profit after taxation was

overstated by £122,222. The Company overstatement of income arose as a result of a subsidiary’s income being

attributed to the Company so did not affect the Group’s Comprehensive Income for the period. The Group’s

overstatement of net profit after taxation arose due to a provision of £122,222 for taxation by one of the Group’s

subsidiaries. For Company the effect was that net assets were lower by £555,556 and for the group the effect was net

assets were lower by £122,222.

AFRICAN PIONEER PLC

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022 (continued)

17. RELATED PARTY TRANSACTIONS

Cavendish Trust Company Limited (CTC) provides company administration and secretarial services to the Company

on normal commercial terms as part of their normal business activity. As such it is not normally treated as a related

party.

Fees paid to CTC during the year include £14,400 (2021: £9,300), relating to director’s fees for the services of

J. Cunningham-Davis, a director of CTC. At the year-end a balance of £10,800 (2021: £Nil), was outstanding.

Lion Mining Finance Limited, a company in which Colin Bird is director and shareholder, has provided financial and

technical services to the Company amounting to £10,800 plus VAT in the year (2021 - £10,800 plus VAT). At the

year-end a balance of £Nil (2021: £Nil) was outstanding. The Board considers this transaction to be on normal

commercial terms and on an arm’s length basis.

In October 2020 a loan of US$ 54,940 (£41,250) was advanced to African Pioneer Zambia Ltd jointly by Colin Bird

(US$ 27,470) and Raju Samtani (US$ 27470) in order to acquire certain licenses

Intragroup Loans

Loan due from / (due to) balances with group companies at the end of the year are as follows. Loans are interest free

and repayable on demand.

2022

2021

Restated

Zamcu Exploration Pty Ltd to African Pioneer Plc

1,414,900

749,952

Resource Capital Partners Pty Ltd to African

Pioneer Plc

(501,032)

(523,357)

African Pioneer Zambia Ltd to African Pioneer Plc

123,817

95,411

Issue of shares at the IPO as disclosed in the Prospectus

(a) The Company entered into a Share Purchase Agreement, dated 29 October 2020 (“Zamcu SPA”) with Tonehill Pty

Ltd, Coreks Super Pty Ltd and Breamline Pty Limited (“Zamcu Sellers”) under which the Zamcu Sellers (which

are controlled by Christian Cordier) agreed to sell to the Company their collective 100 per cent. ownership interests

in Zamcu in return for 10,000,000 shares issued at the IPO with an issue price of 3.5 pence per share in the Company

(“Consideration Shares”). The sale is subject to a 12 month lock-in during which the Zamcu Sellers are not

permitted to sell their Consideration Shares in the Company, followed by a 12 month orderly markets period during

which the Zamcu Sellers are required to work with the Company’s broker for 30 days prior to making any sale.

(b) The Company entered into a Share Purchase Agreement, dated 29 October 2020 (“RCP SPA”) with M&A Wealth

Pty Ltd and Breamline Pty Limited (a company controlled by Christian Cordier) (“RCP Sellers”) under which the

RCP Sellers agreed to sell to the Company their collective 100 per cent. ownership interests in RCP in return for

10,000,000 Consideration Shares in the Company issued at the IPO, of which each RCP Seller received 5,000,000

Consideration Shares. The sale is subject to a 12 month lock-in during which the RCP Sellers are not permitted to

sell their Consideration Shares in the Company, followed by a 12 month orderly markets period during which sellers

are required to work with the Company’s broker for 30 days prior to making any sale.

AFRICAN PIONEER PLC

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022 (continued)

17. RELATED PARTY TRANSACTIONS (continued)

Colin Bird, Mohamad Ahmad, Caleb Amos Mulenga, Lukonde Makungu and Camden Park Trading (a company

controlled by Colin Bird) (“AP Zambia Sellers”) under which the AP Zambia Sellers agreed to sell to the Company

their collective 80 per cent. ownership interests in African Pioneer Zambia Pty Limited (“AP Zambia”) in return

for 55,000,000 Consideration Shares in the Company issued at the IPO, in proportion to their existing holdings of

which 15,000,000 Considerations Shares were issued to each of Colin Bird and Raju Samtani and 5,000,000

Consideration Shares were issued to Camden Park Trading. The sale is subject to a 12 month lock-in during which

the AP Zambia Sellers are not permitted to sell their Consideration Shares in the Company, followed by a 12 month

orderly markets period during which sellers are required to work with the Company’s broker for 30 days prior to

making any sale.

2. Directors’ Letters of Appointment and Service Agreements as disclosed in the Prospectus

(a) Pursuant to an agreement dated 24 May 2021, the Company renewed the appointment of James Cunningham-Davis

as a Director. The appointment continues unless terminated by either party giving to the other 3 months’ notice in

writing. James Cunningham-Davis is entitled to director’s fees of £12,000 per annum for being a director of the

Company plus reasonable and properly documented expenses incurred during the performance of his duties which

will be invoiced by Cavendish Trust Company Ltd an Isle of Man Trust Company that James Cunningham-Davis is

a founder and managing director of. James Cunningham-Davis is not entitled to any pension, medical or similar

employee benefits. The agreement replaces all previous agreements with James Cunningham-Davis and/or

Cavendish Trust Company Ltd in relation to the appointment of James Cunningham-Davis as a director of the

Company.

(b) Pursuant to an agreement dated 24 May 2021, the Company appointed Kjeld Thygesen as a non-executive Director

with effect from the date of the IPO. The appointment continues unless terminated by either party giving to the other

3 months’ notice in writing and Kjeld Thygesen is entitled to director’s fees of £18,000 per annum for being a

director of the Company plus reasonable and properly documented expenses incurred during the performance of his

duties. Kjeld Thygesen is not entitled to any pension, medical or similar employee benefits.

The appointment continues unless terminated by either party giving to the other 3 months’ notice in writing. Colin

Bird is entitled to director’s fees of £18,000 per annum for being a director of the Company plus reasonable and

properly documented expenses incurred during the performance of his duties. Colin Bird is not entitled to any

pension, medical or similar employee benefits. The agreement replaces all previous agreements with Colin Bird in

relation to his appointment as a director of the Company.

(d) Pursuant to a consultancy agreement dated 24 May 2021, the Company has, with effect from the date of the IPO,

appointed Colin Bird as a consultant to provide technical advisory services in relation to its current and future

projects including but not limited to assessing existing geological data and studies, existing mine development

studies and developing exploration programs and defining the framework of future geological and mine study reports

(the “Colin Bird Services”). The appointment continues unless terminated by either party giving to the other 3

months’ notice in writing. Colin Bird is entitled to fees of £3,500 per month for being a consultant to the Company

plus reasonable and properly documented expenses incurred during the performance of the Colin Bird Services.

AFRICAN PIONEER PLC

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022 (continued)

17. RELATED PARTY TRANSACTIONS (continued)

(e) Pursuant to an agreement dated 24 May 2021, the Company renewed the appointment of Raju Samtani. The

appointment continues unless terminated by either party giving to the other 3 months’ notice in writing. Raju Samtani

is entitled to director’s fees of £18,000 per annum for being a director of the Company plus reasonable and properly

documented expenses incurred during the performance of his duties. Raju Samtani is not entitled to any pension,

medical or similar employee benefits. The agreement replaces all previous agreements with Raju Samtani in relation

to his appointment as a director of the Company.

(f) Pursuant to a consultancy agreement dated 24 May 2021, the Company has ,with effect from the date of Admission,

appointed Raju Samtani as a financial consultant to provide financial advisory services to the Company (the “Raju

Samtani Services”). The appointment continues unless terminated by either party giving to the other 3 months’

notice in writing. Raju Samtani is entitled to fees of £2,667 per month for being a consultant to the Company plus

reasonable and properly documented expenses incurred during the performance of the Raju Samtani Services.

(g) Pursuant to an agreement dated 24 May 2021, the Company appointed Christian Cordier as a Director with effect

from the date of Admission. The appointment continues unless terminated by either party giving to the other 3

months’ notice in writing. Christian Cordier is entitled to director’s fees of £18,000 per annum for being a director

of the Company plus reasonable and properly documented expenses incurred during the performance of his duties.

Christian Cordier is not entitled to any pension, medical or similar employee benefits.

(h) Pursuant to a consultancy agreement dated 24 May 2021, with Mystic Light Pty Ltd a personal service company of

Christian Cordier the Company has secured the services of Christian Cordier, with effect from the date of the IPO,

as a business development consultant to provide business development l advisory services to the Company in relation

to its existing and future projects (the “Christian Cordier Services”). The appointment continues unless terminated

by either party giving to the other 3 months’ notice in writing. Mystic Light Pty Ltd is entitled to fees of £1,000 per

month for providing the Christian Cordier Services plus reasonable and properly documented expenses incurred

during the performance of the Christian Cordier Services.

18. POST BALANCE SHEET EVENTS

On 24 January 2023 the Company announced that pursuant to the Executive Share Option Scheme approved at the

Company’s Annual General Meeting (“AGM”) held on 23 August 2022 16,850,000 options over Ordinary Shares

(“Options”) were awarded, 6,600,000 of the Options were awarded to directors of the Company, as detailed below and

the balance of 10,250,000 Options to other eligible participants. The Company had not previously issued any Options.

AFRICAN PIONEER PLC

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022 (continued)

18. POST BALANCE SHEET EVENTS (continued)

Summary of the Options awarded:

Total number of options:

A total of 16,850,000 Options have been awarded.

Exercise prices & award

date:

All the Options have an exercise price of 4.5 pence per Ordinary Share and vested on issue.

Purpose of options:

To incentivise and retain directors, officers, consultants and employees critical to enhancing

the future market value of the Company and have been issued at a significant premium to the

30 day volume weighted average share price (“VWAP”) when the Options were approved.

30 day VWAP when

Options approved:

The 30 day VWAP to 23 January 2023, being the latest practicable date prior to the approval

of the Options by the Company’s Remuneration Committee and Board, was 2.945 pence per

share.

Prevailing share price:

The Company’s mid-market closing share price on 23 January 2023, being the latest

practicable date prior to the announcement of the Options, was 3.3 pence.

Exercise prices versus

abovementioned VWAP

and prevailing share price:

Premium to:

Prevailing

closing

share price

30 day

VWAP

Exercise price of 4.5 pence

36%

53%

Life of Options:

The options expire on 23 January 2033 being the date one day prior to the tenth anniversary

of the award of the Options.

Exercise period:

The Options can be exercised any time after vesting and prior to their scheduled expiry and

must be exercised within 6 months of an option holder leaving the Company or within 12

months of the death of an option holder.

Options awarded to the

Directors

No. of Options

Executive Directors:

Colin Bird Executive Chairman

5,000,000

Christian Cordier Commercial Director

500,000

Raju Samtani Finance Director

600,000

Non Executive Directors:

Kjeld Thygesen Independent

500,000

James Cunningham-Davis

Nil

Total Directors

6,600,000