#117 January 2022 EIII ΙΙΙΞ SOUTH 32 South32 Limited (Incorporated in Australia under the Corporations Act 2001 (Cth)) (ACN 093 732 597) ASX/LSE/JSE Share Code: S32 ADR: SOUHY ISIN: AU000000S320 south32.net HERMOSA PROJECT UPDATE PRESENTATION South32 Limited (ASX, LSE, JSE: S32; ADR: SOUHY) (South32) will hold a conference call at 11:00am Australian Western Standard Time (2:00pm Australian Eastern Daylight Time) on 17 January 2022 to provide an update of the Hermosa project including Q&A, the details of which are as follows: Conference ID: Please pre-register for this call at link. A presentation is attached. Following the conference call a recording will be available on the South32 website (https://www.south32.net/investors-media/investor-centre/presentations-reports-speeches). About us South32 is a globally diversified mining and metals company. Our purpose is to make a difference by developing natural resources, improving people's lives now and for generations to come. We are trusted by our owners and partners to realise the potential of their resources. We produce bauxite, alumina, aluminium, metallurgical coal, manganese, nickel, silver, lead and zinc at our operations in Australia, Southern Africa and South America. With a focus on growing our base metals exposure, we also have two development options in North America and several partnerships with junior explorers around the world. Investor Relations Alex Volante T +61 8 9324 9029 T Tom Gallop +61 8 9324 9030 M +61 403 328 408 M +61 439 353 948 E [email protected] E [email protected] Media Relations James Clothier M +61 413 391 031 E [email protected] Jenny White T M E +44 20 7798 1773 +44 7900 046 758 [email protected] Further information on South32 can be found at www.south32.net. Approved for release by Graham Kerr, Chief Executive Officer JSE Sponsor: UBS South Africa (Pty) Ltd 17 January 2022 Registered Office Level 35 108 St Georges Terrace Perth WA 6000 Australia ABN 84 093 732 597 Registered in Australia#2HERMOSA PROJECT UPDATE 17 January 2022 ΞΙΙΙ ME SOUTH 32#3IMPORTANT NOTICES III SOUTH32 This presentation should be read in conjunction with the "Hermosa Project Update" announcement released on 17 January 2022, which is available on South32's website (www.south32.net) and any other disclosures made to the stock exchanges since this date. Figures in italics indicate that an adjustment has been made since the figures were previously reported. FORWARD-LOOKING STATEMENTS This presentation contains forward-looking statements, including statements about trends in commodity prices and currency exchange rates; demand for commodities; production forecasts; plans, strategies and objectives of management; capital costs and scheduling; operating costs; anticipated productive lives of projects, mines and facilities; and provisions and contingent liabilities. These forward-looking statements reflect expectations at the date of this presentation, however they are not guarantees or predictions of future performance or statements of fact. They involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, and which may cause actual results to differ materially from those expressed in the statements contained in this presentation. Readers are cautioned not to put undue reliance on forward-looking statements. South32 makes no representation, assurance or guarantee as to the accuracy or likelihood or fulfilment of any forward-looking statement or any outcomes expressed or implied in any forward-looking statement. Except as required by applicable laws or regulations, the South32 Group does not undertake to publicly update or review any forward-looking statements, whether as a result of new information or future events. Past performance cannot be relied on as a guide to future performance. South32 cautions against reliance on any forward-looking statements or guidance, particularly in light of the current economic climate and the significant volatility, uncertainty and disruption arising in connection with COVID-19. The denotation (e) refers to an estimate or forecast year. NON-IFRS FINANCIAL INFORMATION This presentation includes certain non-IFRS financial measures, including Underlying earnings, Underlying EBIT and Underlying EBITDA, Basic Underlying earnings per share, Underlying effective tax rate, Underlying EBIT margin, Underlying EBITDA margin, Underlying return on invested capital, Free cash flow, net debt, net cash, net operating assets, Operating margin and ROIC. These measures are used internally by management to assess the performance of our business, make decisions on the allocation of our resources and assess operational management. Non-IFRS measures have not been subject to audit or review and should not be considered as an indication of or alternative to an IFRS measure of profitability, financial performance or liquidity. NO OFFER OF SECURITIES Nothing in this presentation should be read or understood as an offer or recommendation to buy or sell South32 securities or be treated or relied upon as a recommendation or advice by South32. RELIANCE ON THIRD PARTY INFORMATION Any information contained in this presentation that has been derived from publicly available sources (or views based on such information) has not been independently verified. The South 32 Group does not make any representation or warranty about the accuracy, completeness or reliability of the information. This presentation should not be relied upon as a recommendation or forecast by South32. NO FINANCIAL OR INVESTMENT ADVICE - SOUTH AFRICA South32 does not provide any financial or investment 'advice' as that term is defined in the South African Financial Advisory and Intermediary Services Act, 37 of 2002. MINERAL RESOURCES AND ORE RESERVES Clark Deposit scoping study cautionary statement: The scoping study referred to in this presentation is based on low-level technical and economic assessments and is insufficient to support estimation of Ore Reserves or to provide assurance of an economic development case at this stage, or to provide certainty that the conclusions of the scoping study will be realised. The study is based on 60% Indicated and 40% Inferred Mineral Resources (refer to footnotes (slide 29) for cautionary statement).. Production Targets cautionary statement: The information in this presentation that refers to Production Target and forecast financial information is based on Measured (20%), Indicated (62%), Inferred (14%) Mineral Resources and Exploration Target (4%) for the Taylor Deposit. The Mineral Resources underpinning the Production Target have been prepared by a Competent Person in accordance with the JORC Code (refer to footnotes (slide 29) for cautionary statement). All material assumptions on which the Production Target and forecast financial information is based is provided in the "Hermosa Project Update" announcement released on 17 January 2022. There is low level of geological confidence associated with Inferred Mineral Resources and there is no certainty that further exploration work will result in the determination of Indicated Mineral Resources or that the Production Target will be realised. The potential quantity and grade of the Exploration Target is conceptual in nature. In respect of Exploration Target used in the Production Target, there has been insufficient exploration to determine a Mineral Resource and there is no certainty that further exploration work will result in the determination of Mineral Resources or that the Production Target itself will be realised. The stated Production Target is based on South32's current expectations of future results or events and should not be solely relied upon by investors when making investment decisions. Further evaluation work and appropriate studies are required to establish sufficient confidence that this target will be met. South32 confirms that inclusion of 18% of tonnage (14% Inferred Mineral Resources and 4% Exploration target) is not the determining factor of the project viability and the project forecasts a positive financial performance when using 82% tonnage (20% Measured and 62% Indicated Mineral Resources). South32 is satisfied, therefore, that the use of Inferred Mineral Resources and Exploration Target in the Production Target and forecast financial information reporting is reasonable. Competent Persons Statement and cautionary statement - Exploration Results and Exploration Target: The information in this presentation that relates to Exploration Results and Exploration Targets for Hermosa (including Peake) was declared in the "Hermosa Project Update" announcement released on 17 January 2022 and is prepared by a Competent Person in accordance with the requirements of the JORC Code. South32 confirms that it is not aware of any new information or data that materially affects the information included in the original market announcement. South32 confirms that the form and context in which the Competent Person's findings are presented have not been materially modified from the original market announcement. In respect of those Exploration Targets, The potential quantity and grade is conceptual in nature. There has been insufficient exploration to determine a Mineral Resource and there is no certainty that further exploration work will result in the determination of Mineral Resources. SLIDE 2#4HERMOSA HIGHLIGHTS Taylor PFS demonstrates its potential to be Hermosa's first development and deliver attractive returns over multiple stages A low carbon, low impact option in the first quartile of the industry's cost curve Preferred configuration of a conventional 4.3Mtpa plant and dual shaft access (a) III SOUTH32 Potential to be a globally significant producer of metals critical to a low carbon future Located in Arizona, USA close to infrastructure, skilled service providers and supply chains Taylor's large Mineral Resource remains open, while activities to unlock value from Clark and our regional exploration are continuing Notes: a. Refer to important notices (slide 2) for additional disclosure. SLIDE 3#5RESHAPING OUR PORTFOLIO Taylor's development (a) would further increase our leverage to the metals critical to a low carbon future We have substantial production growth focused on green metals Illustrative Group production profile(b) US$M revenue equivalent at FY21 realised prices Group1 Notes: a. b. Refer to important notices (slide 2) for additional disclosure. Illustrative production growth is calculated using FY21 realised prices. Our portfolio already has significant exposure to the commodities which benefit from the uptake of low carbon technologies Sierra Gorda proposed copper acquisition² Aluminium value chain Manganese ore Committed green aluminium growth³ Base and precious metals Metallurgical coal +32% Taylor PFS4 SLIDE 4 III SOUTH32#6HERMOSA PROJECT A large regional landholding hosting multiple development options and exploration targets Hermosa land package III SOUTH32 Flux Prospect Taylor Deposit Peake Prospect N 0 1 2 3 4 5 Km Clark Deposit Hity High Pridor Patented Unpatented Prospects Deposits Taylor is an attractive base metals development option Notes: a. Refer to important notices (slide 2) for additional disclosure. b. Refer to footnotes (slide 29) for additional disclosure. Clark offers the separate potential to produce a battery-grade manganese product for North America A highly prospective land package • • 138Mt zinc-lead-silver sulphide Mineral Resource with a Hermosa Exploration Target ranging from 10 to 95Mt (a) PFS demonstrates potential for a sustainable, low cost operation with 20+ year initial resource life (b) Final investment decision expected in mid CY23 • • • 55Mt zinc-manganese-silver oxide Mineral Resource (b) Scoping study (a) has confirmed the potential to produce battery-grade manganese into rapidly-growing markets Manganese listed as a critical mineral in the United States Studies to consider a potential integrated development of Taylor and Clark, unlocking operating and capital synergies Since acquisition, we have increased our tenure by 66%, consolidating the most prospective areas Through soil sampling, geophysics and mapping, we have defined a highly prospective corridor High-grade copper-lead-zinc-silver mineralisation intersected at the Peake prospect, south of the Taylor Deposit Planning to drill the Flux prospect in late CY22, located down-dip of an historic mining area SLIDE 5#7OUR APPROACH TO HERMOSA'S SUSTAINABLE DEVELOPMENT Our commitment to sustainable development is embedded in our approach to project development Partnering with local communities Preserving cultural heritage Managing our environmental impact . . • • • We are investing in local programs and partnerships that reflect the priorities of the communities around Hermosa We have established local procurement and employment plans We are committed to working with Native American tribes to protect cultural resources We have completed initial surveys for cultural resources on both our patented lands and unpatented mining claims We have established an environmental management plan and completed key studies for biodiversity, ecosystems and water We have established a state-of-the-art dry stack tailings facility We have a strong focus on water management and minimising surface footprint in the PFS design Targeting a carbon neutral development • . A low carbon intensity operation with a pathway to net zero Potential to access 100% renewable energy from local providers Studying options to use battery electric vehicles and mining equipment 65 Ell SOUTH32 Hermosa SOUTH32 EIII SOUTH32 ME SOUTH 32 SLIDE 6#8TAYLOR PFS SUMMARY IIIE SOUTH32 Potential for a large scale, low-cost, multi-decade operation adopting a conventional processing circuit PFS summary information Mine design Process design Nameplate capacity Products Resource life Head grades Recoveries Metal payability Annual payable zinc production Annual payable lead production Annual payable silver production Annual payable ZnEq production5 Operating unit costs Longhole open stoping underground mine with paste backfill plant Conventional sulphide ore flotation circuit Up to 4.3Mtpa in the preferred PFS development scenario (a) Zinc and lead concentrates, with silver credits ~22 years ~4.1% Zn, ~4.5% Pb, ~82 g/t Ag ~90% Zn, ~91% Pb, ~81% Ag (in Pb concentrate) ~85% Zn, ~95% Pb, ~95% Ag (in Pb concentrate) ~111kt ~138kt ~7.3Moz ~280kt ~US$81/t ore milled Taylor site map Main shaft WTP1 Ventilation shaft WTP2 T Dry-stack TSF Paste plant Primary access road Operating unit costs Growth capital Sustaining capital Fiscal terms Notes: a. ~US$(0.71)/lb ZnEq ~US$1,700M comprising ~US$1,230M (direct) & ~US$470M (indirect) ~US$40M per annum Corporate tax rate ~26% Refer to important notices (slide 2) for additional disclosure. Processing plant Harshaw Road SLIDE 7#9TAYLOR MINERAL RESOURCE Taylor's large Mineral Resource is expected to underpin Hermosa's first phase of development Taylor Deposit geology and mineralisation (looking south-west) NSR cut-off (US$/t) NSR 15 80 NSR 80 100 NSR 100 130 NSR 130 200 NSR > 200 Notes: a. Refer to footnotes (slide 29) for additional disclosure. 0 Proposed shaft locations Taylor Deposit SOUTH32 138Mt Mineral Resource with a zinc equivalent grade of 8.61% (a) Large orebody with a strike length of ~2.5km and width of ~1.9km Extends to a depth of ~1.2km Comprises the upper Taylor sulphide and lower Taylor deeps domains that have a general northerly dip of 30° Orebody geometry enables concurrent mining from multiple independent areas, supporting the potential for high productivity and throughput Taylor Deposit Mineral Resource Classification Mt Zn (%) Pb (%) Ag (g/t) ZnEq (%) Measured 29 4.10 4.05 57 8.25 Indicated 86 3.76 4.44 86 8.79 10.5 Measured and Indicated 115 3.85 4.34 79 8.65 km Inferred 24 3.73 3.82 91 8.41 Total 138 3.82 4.25 81 8.61 SLIDE 8#10HERMOSA EXPLORATION POTENTIAL Our resource range analysis work supports the potential for further resource growth Taylor Deposit and Exploration Target A highly prospective mineralised system, open at depth and laterally We have completed resource range analysis work aimed at developing an unconstrained, spatial view of the Exploration Target at Taylor, considering extensional and near-mine exploration potential Our resource range analysis utilises deterministic estimates of potential volumes and grades using assumptions for continuity and extension consistent with available data and models Exploration Target ranges from 10 to 95Mt, with a mid case of ~45Mt Exploration Target(a)(b) SOUTH32 Low Case Mid Case High Case % % g/t % % g/t % % g/t Mt Mt Mt Zn Pb Ag Zn Pb Ag Zn Pb Ag Clark Deposit (NSR cut-off US$175/t) Taylor Deposit (NSR cut-off US$80/t) Exploration Target extension 0 10.5 km Sulphide 10 3.8 4.2 81 45 3.4 3.9 82 95 3.6 4.0 79 Notes: a. Refer to important notices (slide 2) for additional disclosure. b. Cut-off grade: NSR of US$80/t. SLIDE 9#11HERMOSA EXPLORATION POTENTIAL Peake prospect Volcanics Notes: a. SOUTH32 A new exploration target prospective for copper mineralisation Clark Deposit Taylor Deposit Carbonate • Peake prospect(a) . . Exploration drilling has identified near-mine exploration targets, including the Peake prospect High-grade copper-lead-zinc-silver mineralisation has been intersected at the skarn hosted Peake prospect, south of the Taylor Deposit Interpretation of these results and recently acquired data indicates the potential for a continuous structural and lithology controlled system connecting Taylor Deeps and Peake, a deeper zone prospective for copper Further exploration drilling is planned in CY22 Peake prospect - selected drilling results Taylor Deeps Carbonate 170,000N Hole ID Taylor Thrust From (m) 1279.2 To (m) 1389.0 Cut off 0.2% Cu Width (m) 109.7 Zinc Lead Silver Copper (%) (%) (ppm) (%) 0.1 0.3 15 0.62 HDS-540 Including 1303.6 1308.2 1309.7 1384.7 0.2% Cu 0.2% Cu 6.1 76.5 0.2 0.4 61 3.48 0.2 0.4 25 1.52 Including Intrusive HDS-552 1309.9 1328.6 0.2% Cu 18.8 0.1 0.2 40 2.77 Peake Prospect 300m And 1364.3 1384.7 0.2% Cu 20.4 0.1 0.3 37 2.44 1322.2 1374.6 0.2% Cu 52.4 0.1 1.1 105 1.73 1000ft Including 1322.2 1346.0 0.2% Cu 23.8 0.1 0.8 81 3.32 165,000N Including HDS-661 1322.2 1330.1 1386.8 1460.6 0.2% Cu 0.2% Cu 7.9 73.8 0.1 0.5 100 0.4 81 7.89 0.7 67 1.06 Including 1399.6 1410.3 HDS-717 1456.6 1466.7 0.2% Cu 0.2% Cu 10.7 10.1 0.7 1.5 0.5 1.0 50 227 2.84 78 2.57 Refer to important notices (slide 2) for additional disclosure. SLIDE 10#12PFS MINE DESIGN Our PFS mine design employs conventional methods, delivering high productivity from multiple faces Taylor Deposit underground mine design Dual shaft access prioritises higher grade ore in early years 0 Proposed mining method is low technical risk, employing longhole open stoping, similar to Cannington Multiple concurrent mining areas expected to support high productivity 800m Shafts Single stage ramp-up following orebody dewatering to nameplate production Drives Declines Stopes Exploration platforms Ventilation shaft Main shaft Primary haulage level and shaft loadout SLIDE 11 SOUTH32#13PFS PROCESS DESIGN Conventional sulphide ore flotation circuit that produces separate zinc and lead concentrates with silver credits ORE MINING LEAD CIRCUIT CRUSHING Lead rougher circuit feeds into the zinc rougher circuit Lead thickener produces lead concentrate SCREENING ZINC CIRCUIT Stope and development ore is mined, crushed underground, hoisted to surface and screened Zinc rougher circuit produces tailings Zinc thickener produces zinc concentrate ப CONCENTRATE HAULAGE TAILINGS AND BACKFILL Paste backfill TSF SLIDE 12 SOUTH32#14SITE INFRASTRUCTURE Project's initial water treatment plant and tailings storage facility are already established Existing water and tailings infrastructure SOUTH32 Water Additional capital required to establish water wells and a second water treatment plant The first water treatment plant is installed and treatment upgrades are expected to be commissioned in Q3 FY22 Construction to support critical path orebody dewatering is planned to commence in H2 FY22 • Second water treatment plant expected to be commissioned in Q4 FY23 Tailings storage • We have completed the remediation of historic tailings, establishing the first of two state-of-the-art dry stack tailings storage facilities (TSF) • Approximately half of Taylor's planned tailings are to be sent underground as paste fill, reducing its surface environmental footprint First TSF on patented land, with several State-based permits already received for dewatering • Subsequent expansion of tailings storage capacity to require Federal permitting • Power Site power expected to be met through a grid-connected high voltage transmission line Discussions initiated to secure 100% renewable energy from local providers Services and labour Excellent access to local service providers and skilled labour SLIDE 13#15TRANSPORT AND LOGISTICS Hermosa is well located with the potential to serve multiple markets from established infrastructure Concentrate readily exported to Asian and European smelters Access to multiple North American ports Concentrate expected to be trucked to a rail transfer facility or directly to port Transport logistics Rail Feasibility study to investigate the potential to supply smelters in the Americas Port Phoenix Tucson Hermosa project United States of America Asian markets European markets Mexico SLIDE 14 SOUTH32#16PFS PRODUCT RECOVERIES Taylor is expected to produce high-quality zinc and lead concentrates, with substantial silver by-product credits Mid-grade zinc concentrate with relatively high silver content High-grade lead concentrate Silver primarily reports to the lead concentrate Metallurgical test work indicates excellent recoveries Average metal recoveries % 90% 91% 81% Zinc in zinc concentrate Lead in lead concentrate Silver in lead concentrate SLIDE 15 III SOUTH32#17PFS PRODUCTION PROFILE Preferred PFS development scenario to target throughput of up to 4.3Mtpa(a) PFS production schedule has first ore expected in FY27 and a single stage ramp up to nameplate in FY30 Payable ZnEq production and ZnEq head grade5 ktpa, LHS; %, High grade mineralisation (~12% ZnEq) targeted in the first five years of mine plan Average production in steady state years ~340ktpa ZnEq (FY30 to FY44) 400 350 300 250 200 150 100 50 Potential to extend the initial resource life Notes: a. Refer to important notices (slide 2) for additional disclosure. 0 Up to 4.3Mtpa nameplate capacity, ~22 year resource life 9.9% Resource life (FY27 to FY49) ■Zinc (LHS) Lead (LHS) Silver (LHS) 9.8% Steady state years (FY30 to FY44) ● ZnEq head grade SLIDE 16 SOUTH32#18PFS OPERATING UNIT COSTS Operating unit costs are expected to benefit from underground productivity, production scale and favourable location Operating unit costs? US$/t ore milled (average) ~23 ~10 Mining ~13 Processing General and administrative Other Negative Operating unit costs with by-product credits Operating unit costs • Mining costs include all activities related to underground mining, including labour, materials, utilities and maintenance III SOUTH32 . ~35 ZnEq Operating unit cost ~US$(0.71)/lb ZnEq All-in sustaining cost⁹ ~US$(0.05)/lb ZnEq Processing costs include consumables, labour and power • General and administrative costs include head office corporate costs and site support staff • Other costs include shipping and transport, marketing and royalties, with private net smelter royalties averaging 2.4% SLIDE 17#19PFS OPERATING UNIT COSTS Taylor's unit costs are expected to be in the first quartile of the industry's cost curve(a) Zinc total cash and sustaining costs curve CY29(a) USC/lb, real 1 January 2021, net of credits 200 -200 -400 Taylor AISC(b) III SOUTH32 Potential opportunities to further reduce operating costs during feasibility include: • Optimisation of the mining schedule, power consumption and comminution circuit • Potential to supply smelters in the Americas, realising a material reduction in shipping and transport costs Emerging technology and automation opportunities to be further tested, targeting enhanced productivity Notes: a. b. Based on Wood Mackenzie Zinc Mine Normal Costs Curve (2021 Q4 dataset), and is calculated as the sum of direct costs, indirect cash costs, interest charges and sustaining capital expenditure. Based on Taylor all-in sustaining cost (AISC) during steady-state operations (FY30 to FY44) of approximately US$(0.13)/lb Zn Eq. SLIDE 18#20PFS CAPITAL EXPENDITURE Upfront investment required to support additional orebody dewatering Four year construction period following final investment decision III SOUTH32 • • • • • • • Direct growth capital includes estimates for all mining, processing and other surface infrastructure, including tailings, water and power Capital estimate reflects assumptions for key inputs including steel, cement and labour as at H1 FY22 Mine development and processing plant cost estimates benchmark favourably, while additional capital has been allocated for upfront dewatering and to establish dedicated power infrastructure Includes pre-commitment capital for dewatering of US$55M in H2 FY22, with further investment expected in FY23 Annual average sustaining capital ~US$40M Further optimisation of costs and design will focus on shaft optimisation and the potential benefits from a co-development of the Clark Deposit Additional costs will be incurred during the study phase, attributable to the Taylor feasibility study and work across the broader Hermosa project Pre-production capital expenditure (US$M) Indirect costs include EPCM, owner's costs and contingency Includes additional expenditure on water wells and a second water treatment plant Includes shaft development (~$310M), mobile equipment and infrastructure ~470 ~565 ~225 ~440 Includes processing plant (~$350M), tailings and utilities Direct costs Surface facilities Mining Dewatering Indirect costs ☐ SLIDE 19#21PFS TIMELINE AND APPROVALS Taylor feasibility study and a final investment decision expected in mid CY23 Preferred development path assumed in the PFS (a) PFS completed H2 FY22 Dewatering construction commences Feasibility study completed and final investment decision Shaft development commences First production targeted H2 FY22 Mid CY23 FY24 FY27 SOUTH32 Key approvals and permits required for the Taylor Deposit • Initial underground development, surface infrastructure and initial tailings placement are expected to be located on patented mining claims, requiring approvals and permits from the State of Arizona. Several State-based permits for dewatering are already held • • Surface disturbance on unpatented land will require completion of the National Environmental Policy Act (NEPA) process with the United States Forest Service to receive a Record of Decision (RoD) RoD would enable the establishment of tailings storage capacity on unpatented land The project may benefit from the classification of metals found at Hermosa as critical minerals in the United States. Zinc is proposed to be added as a critical mineral by the U.S. Geological Survey while manganese (Clark Deposit) already has this designation Notes: a. Illustrative development path for the Taylor Deposit in the PFS, which is subject to investment approvals and receipt of required permits. SLIDE 20#22CLARK SCOPING STUDY Scoping study has confirmed the potential to produce battery-grade manganese via Clark's separate development Taylor and Clark Deposits (looking south-west) Clark Deposit (NSR cut-off US$175/t) III SOUTH32 Proposed shaft locations Clark Deposit 55Mt Mineral Resource averaging 2.31% zinc, 9.08% manganese and 78g/t silver(a) • Mineralised from surface with the potential to share underground infrastructure with Taylor Separate processing circuit to Taylor required to produce battery-grade manganese Scoping study results(b) • • Confirmed a technically viable flowsheet to produce battery grade manganese: Manganese Sulphate Monohydrate; or Electrolytic Manganese Metal. Metallurgical test work has confirmed the hydrometallurgical flowsheet We are exploring partnerships across the battery materials supply chain Forward plan We will now complete a PFS for a potential underground mine development, focused on: increasing confidence in our technical and operating assumptions; customer opportunities; and integrated development options with Taylor, unlocking operating and capital efficiencies for both If the results are supportive, the Clark feasibility study may be combined with Taylor to examine the potential for a second stage development Taylor Deposit (NSR cut-off US$80/t) 0 10.5 km Notes: a. Refer to footnotes (slide 29) for additional disclosure. b. Refer to important notices (slide 2) for additional disclosure. SLIDE 21#23HERMOSA REGIONAL EXPLORATION Hermosa hosts a highly prospective regional land package with the potential for future discoveries III SOUTH32 . We have increased our tenure by 66% since acquisition, consolidating the most prospective areas for polymetallic and copper mineralisation Prospective corridor identified using surface geophysics, soil sampling and mapping Flux identified as a priority prospect in the regional corridor: Immediately downdip of a historic mining area in carbonates with the potential to host Taylor-like mineralisation Flux An initial diamond drilling program planned in H2 CY22 (subject to the receipt of permits) Our ongoing exploration strategy will focus on identifying, permitting and drill testing new targets in the broader land package Chargeability model of Flux prospect(a) (mV/V) Elevation (m) 1600 1400 1200 1000 800 600 400 A A' Notes: a. Refer to footnotes (slide 29) for additional disclosure. 50.0 37.8 25.5 13.3 1.0 Taylor Peake Patented Unpatented Prospects Deposits A High Priority Corridor Clark A' 5km Historical mine Planned drilling Limestone structural zone SLIDE 22#24LOOKING AHEAD III SOUTH32 PFS results show Taylor's potential to underpin Hermosa's first stage of development Taylor feasibility study and final investment decision expected in mid CY23 Critical path works including dewatering infrastructure expected to commence in H2 FY22 We are assessing Clark's potential to be a second development option at Hermosa Evaluating opportunities to reduce initial capital, including further optimisation of the shaft design, construction and procurement Planning to drill the high priority Flux prospect in late CY22, subject to receipt of permits SLIDE 23#25SUMMARY III SOUTH32 Hermosa is a regional scale opportunity pursuing critical green metals, with the potential for multiple stages of development Taylor PFS has defined the potential for an initial mine development in the first quartile of the industry's cost curve Potential to add to our broader portfolio's substantial production growth in metals critical to a low carbon future SLIDE 24#26ΞΙΙΙ IIIE SOUTH 32 SUPPLEMENTARY INFORMATION#27ZINC MARKET III SOUTH32 Strong demand in transport, consumer and industrial sectors, with rising intensity of use Rapid deployment of wind and solar infrastructure to create new demand Supply expected to fall 3.5% pa to 2030, requiring investment in new mine supply and inducement pricing Zinc primary demand (kt Zn) 25,000 20,000 15,000 10,000 5,000 2020 +100% 2040 ■Construction and infrastructure ■Consumer goods and machinery ■Transportation Renewable infrastructure in 1.5C scenario Source: South32 analysis and Wood Mackenzie. Demand • • Zinc provides a protective coating in wind turbines, and allows for higher energy conversion in solar panels In a 1.5°C (climate change) scenario, we see: • 6x increase in renewable energy capacity to 2050, with wind increasing by 10x and solar by 14x Primary zinc demand increasing 2x to 24Mt Supply Conversely, current mine supply expected to fall by 3.5% pa (~270kt pa) to 2030 Mine depletion, new builds with lower average grades and longer approval pathways will continue to constrain supply Pricing needed to induce new marginal supply to support average prices in the long term SLIDE 26#28LEAD MARKET Growth in the ICE (a) fleet will support demand in the short to medium term Renewable energy storage will remain a key component of demand EV penetration rates and resultant scrap supply will ultimately determine the market balance Total lead demand by end-user sectors 15% 2020 15% 2040 • 37% +29% 46% 18% 19% 12.4Mt 15.9Mt 18% 11% Source: South32 analysis. Notes: a. b. 8% 13% Transport (replacement) Traction (b) Other Transport (original equipment) Stationary (energy storage) ICE refers to internal combustion engine. Traction batteries refers to automotive batteries used to power smaller vehicles, including e-bike, trikes and forklifts. Demand III SOUTH32 While electric vehicle penetration rates are forecast to rise, concurrent growth in the internal combustion engine fleet supports demand for lead batteries in the short to medium term The safety-related and low-cost characteristics of lead-acid batteries makes them an attractive choice for renewables energy storage Supply Mine supply expected to fall by 3.8% pa (~100kt pa) to 2040 In our base case, rising scrap production is insufficient to balance the projected market shortfall, requiring new mine supply and inducement pricing In a 1.5C (climate change) scenario, scrap supply would be significantly higher with the accelerated shift away from ICE vehicles, potentially limiting the need for additional primary supply SLIDE 27#29SILVER MARKET Silver used extensively in solar panels Primary silver demand: 2020 to 2040 (Moz) 1,600 1,400 +55% 1,200 1,000 800 600 400 200 14x increase in solar capacity anticipated in a 1.5C world Lack of new high-content silver polymetallic mines expected to culminate in a material market deficit +25% 2020 Base Case 1.5C scenario Source: South32 analysis and CRU III SOUTH32 +95% Demand • Silver is the preferred metal used in solar panels due to its superior electrical conductivity 55% increase in primary demand to 2040 expected in our base case scenario The level of demand growth rises a further 25% to 1,400Moz in a 1.5°C (climate change) scenario Supply • Additional demand of ~30Moz pa until 2040 is equivalent to more than two new Cannington mines being built each year Despite this, there are very few high-silver polymetallic options identified globally with a material silver deficit looming Additionally, constrained Chinese mine volumes are expected to induce higher imports of high-silver lead concentrates to meet domestic silver demand SLIDE 28#30FOOTNOTES 1. Group FY21 operating revenue excluding South Africa Energy Coal. Refer to market release "Financial Results and Outlook - year ended 30 June 2021" dated 19 August 2021. III SOUTH32 2. 3. 4. 5. 6. 7. 8. 9. 45% interest in the Sierra Gorda copper mine. Refer to market release "South32 to acquire a 45% interest in the Sierra Gorda copper mine" dated 14 October 2021. The estimates indicated in the Original announcement are qualifying foreign estimate and are not reported in accordance with the JORC Code. A Competent Person has not done sufficient work to classify foreign estimates as Mineral Resources or Ore Reserves in accordance with the JORC Code. It is uncertain that following evaluation and/or further work that the foreign estimates will be reported as Mineral Resources or Ore Reserves in accordance with the JORC Code. 276kt increase in annual aluminium production (South32 share), following completion of the acquisition of an additional 16.6% interest in Mozal Aluminium and the restart of the Alumar aluminium smelter at nameplate capacity. Refer to market releases, "South32 to acquire up to an additional 25% of Mozal Aluminium" dated 30 September 2021 and "Restart of Brazil Aluminium using renewable power" dated 6 January 2022, respectively. Revenue equivalent production in the PFS steady state years (FY30 to FY44), averaging 130kt zinc, 166kt lead and 8.7Moz silver. Payable zinc equivalent was calculated by aggregating revenues from payable zinc, lead and silver, and dividing the total revenue by the price of zinc. Average metallurgical recovery assumptions are 90% for zinc, 91% for lead and 81% for silver. FY21 average index prices for zinc (US$2,695/t), lead (US$1,992/t) and silver (US$25.50/oz) (excluding treatment and refining charges) have been used. Federal tax of 21.0% and Arizona state tax of 4.9% of taxable income, subject to applicable allowances. Hermosa has an opening tax loss balance of approximately US$83M as at 30 June 2020. Property and severance taxes are also expected to be paid. Based on the PFS schedule, we expect to commence paying income taxes from FY29. Operating unit cost is Revenue less Underlying EBITDA, excluding third party sales and TCRCS, divided by sales volumes. The prices used are FY21 average index prices for zinc (US$2,695/t), lead (US$1,992/t) and silver (US$25.50/oz) (excluding TCRCs). ZnEq Operating unit cost includes lead and silver by-product credits, using FY21 average index prices. All-in sustaining cost (AISC) includes operating unit costs (including royalties), TCRCS, and sustaining capital expenditure. The denotation (e) refers to an estimate or forecast year. The following abbreviations have been used throughout this presentation: all-in sustaining costs (AISC); billion (B); calendar year (CY); earnings before interest, tax, depreciation and amortisation (EBITDA); engineering, procurement and construction management (EPCM); equity accounted investments (EAI); electric vehicle (EV); feasibility study (FS); final investment decision (FID); financial year (FY); free on board (FOB); internal combustion engine (ICE); kilo tonnes (kt); kilo tonnes per annum (ktpa); lead (Pb); left hand side (LHS); life of mine (LOM); million (M); million tonnes (Mt); million tonnes per annum (Mtpa); millivolts per volt (mV/V); National Environmental Policy Act (NEPA); net smelter return (NSR); pre-feasibility study (PFS); pound (lb); Record of Decision (RoD); right hand side (RHS); silver (Ag); tailings storage facility (TSF); treatment and refining charges (TCRCs); United States (US); volts (V); water treatment plant (WTP); zinc (Zn); and zinc equivalent (ZnEq). MINERAL RESOURCES AND ORE RESERVES Mineral Resource Statements for the Taylor and Clark deposits: The information in this presentation that relates to Mineral Resources for the Taylor and Clark deposits is extracted from South32's FY21 Annual Report (www.south32.net) published on 3 September 2021. The information was prepared by a Competent Person in accordance with the requirements of the JORC Code. South32 confirms that it is not aware of any new information or data that materially affects the information included in the original market announcement, and that all material assumptions and technical parameters underpinning the estimates in the relevant market announcement continue to apply and have not materially changed. South32 confirms that the form and context in which the Competent Person's findings are presented have not been materially modified from the original market announcement. Resource life is estimated using Mineral Resources (extracted from South32's FY21 Annual Report published on 3 September 2021 and available to view on www.south32.net) and Exploration Target (details of which are available in the "Hermosa Project Update" announcement published on 17 January 2022), converted to a run-of-mine basis using conversion factors, divided by the nominated run-of-mine production rate on a 100% basis. Whilst South32 believes it has a reasonable basis to reference this resource life and incorporate it within its Production Targets, it should be noted that resource life calculations are indicative only and do not necessarily reflect future uncertainties such as economic conditions, technical or permitting issues. Resource life is based on our current expectations of future results and should not be solely relied upon by investors when making investment decisions. Flux Exploration Target: The information is this presentation that relates to Exploration Target for Flux is extracted from "South32 Strategy and Business Update" published on 18 May 2021 and is available to view on www.south32.net. The information was prepared by a Competent Person in accordance with the requirements of the JORC Code. South32 confirms that it is not aware of any new information or data that materially affects the information included in the original market announcement. South32 confirms that the form and context in which the Competent Person's findings are presented have not been materially modified from the original market announcement. SLIDE 29#31EIII IIIE SOUTH32