Atalaya Mining : Report on Payments to Governments

REPORT ON PAYMENTS TO GOVERNMENTS

20

23

For the year end 31 december 2023

Atalaya Mining Plc

REPORT ON PAYMENTS TO GOVERNMENTS 2023

Chief Financial

Officer´s

Statement

César Sánchez

Chief Financial Officer

"Dear Stakeholders,

I am pleased to present our annual Payment to Government Report, which underscores our unwavering commitment to fiscal transparency and regulatory compliance.

This report provides a detailed account of taxes and other specified payments made to government entities, which are associated with our diverse portfolio of activities, including mining, exploration and development together with associated holding and financing of investments. The payments disclosed for the year 2023 and preceding years are a testament to our enduring dedication to openness and transparency across all regions where we operate.

We are firmly of the belief that this transparent approach bolsters the trust and relationships we have nurtured with our stakeholders, particularly with governments at the local, regional, and national levels.

Our operations within host countries play an important role in enabling governments to capitalise on their assets. The taxes we contribute finance public services, infrastructure development, public investments, and various other essential services that benefit the communities where our natural resources are located. Our company's tax contributions are designed to engender a lasting, significant, and positive impact on local governments and their host countries.

In 2023, our company made significant tax contributions through our operating mine in southern Spain and our brownfield copper project in the northwest of Spain, totalling €3.4 million. In addition, our holdings, trading, and financing activities in Cyprus contributed €3.0 million in taxes.

Our commitment to governments and host countries extends beyond mere tax contributions. We take immense pride in actively supporting the communities where we operate through social investments and by generating direct, indirect, and induced impacts on businesses. In 2023 alone, our company provided employment for approximately 488 individuals, indirectly created over 1,300 jobs, and facilitated 600+ induced and other non-business-related activities that benefitted the surrounding communi- ties.

These payments are representative of our mining operations and business activities at each individual location.

Our company remains steadfastly committed to transparency with our shareholders and other interested parties. They can rest assured that we operate as a responsible corporate citizen, dedicated to making a positive and sustainable impact on the communities we serve.

Thank you for your continued support and trust in our company.

A copy of the Payments to Government Report can be found below and on the Company's website www.atalayamining.com.

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Atalaya Mining Plc

REPORT ON PAYMENTS TO GOVERNMENTS 2023

INTRODUCTION

This report provides a comprehensive breakdown of Payments to Governments by Atalaya Mining Plc and its subsidiaries ('Atalaya' or 'the Group') for activities related to mineral exploration, discovery, develo- pment, and extraction. Covering the fiscal year ending on 31 December 2023, this disclosure is in compliance with the Transparency Directive Amending Directive (2013/50/EU) ('the Regulations'). The report aligns with Chapter 10 of the EU Accounting Directive (2013/34/EU) and goes beyond regulatory requirements by including a voluntary supplementary section detailing payments categorized by 'regions and commodity'.

Atalaya Mining, Plc.

Atalaya Mining Plc (the "Company") was incorporated in Cyprus on 17 September 2004 as a private company with limited liability under the Companies Law, Cap. 113 and was converted to a public limited liability company on 26 January 2005. Its registered office is at 1 Lampousa Street, Nicosia, Cyprus.

The Company was listed on AIM of the London Stock Exchange in May 2005 under the symbol ATYM. The Company continued to be listed on AIM as at 31 December 2023.

On 20 February 2023, Atalaya announced that applied a voluntary delisting of its ordinary shares from the Toronto Stock Exchange (the "TSX") with an expected effective date of the closing of trading on 7 March 2023. Ordinary shares in the Company continue to trade on the AIM market of the London Stock Exchange under the symbol "ATYM". Delisting from TSX finally took effect at the close of trading on 20 March 2023.

At the date of this reporting, the Company is also progressing its application to the Financial Conduct Authority to admit its ordinary shares to the premium listing segment of the Official List and to trading on the London Stock Exchange main market for listed securities. Admission remains subject to a number of conditions including the approval by the FCA of a prospectus.

Additional information about Atalaya Mining Plc is available at www.atalayamining.com.

The Group has interests in four mining projects: Proyecto Riotinto, Proyecto Touro, Proyecto Masa Valver- de and Proyecto Ossa Morena. In addition, the Group has an earn-in agreement to acquire three investigation permits at Proyecto Riotinto Este.

Proyecto Riotinto

The Company owns and operates through a wholly owned subsidiary, "Proyecto Riotinto", an open-pit copper mine located in the Iberian Pyrite Belt, in the Andalusia region of Spain, approximately 65 km northwest of Seville. A brownfield expansion of this mine was completed in 2019 and successfully commissioned by Q1 2020.

Proyecto Touro

The Group has an initial 10% stake in Cobre San Rafael, S.L., the owner of Proyecto Touro, as part of an earn-in agreement which will enable the Group to acquire up to 80% of the copper project. Proyecto Touro is located in Galicia, north-west Spain. Proyecto Touro is currently in the permitting process.

In November 2019, Atalaya executed the option to acquire 12.5% of Explotaciones Gallegas del Cobre, S.L. the exploration property around Touro, with known additional reserves, which will provide high potential to the Proyecto Touro.

Proyecto Masa Valverde

On 21 October 2020, the Company announced that it entered into a definitive purchase agreement to acquire 100% of the shares of Cambridge Mineria España, S.L. (since renamed Atalaya Masa Valverde, S.L.U.), a Spanish company which fully owns the Masa Valverde polymetallic project located in Huelva (Spain).

In November 2023, the mining permit (in Spanish the "Permiso de Explotación") for the Masa Valverde and Majadales deposits was officially granted.

Proyecto Ossa Morena

In December 2021, Atalaya announced the acquisition of a 51% interest in Rio Narcea Nickel, S.L., which owns 9 investigation permits. The acquisition also provided a 100% interest in three investigation permits that are also located along the Ossa- Morena Metallogenic Belt. In Q3 2022, Atalaya increased its ownership interest in Proyecto Ossa Morena to 99.9%, up from 51%, following completion of a capital increase that will fund exploration activities.

Proyecto Riotinto Este

In December 2020, Atalaya entered into a Memorandum of Understanding with a local private Spanish

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Atalaya Mining Plc

REPORT ON PAYMENTS TO GOVERNMENTS 2023

company to acquire a 100% beneficial interest in three investigation permits (known as Peñas Blancas, Cerro Negro and Herreros investigation permits), which cover approximately 12,368 hectares and are located immediately east of Proyecto Riotinto

BASIS OF PREPARATION

SCOPE OF REPORT

Disclosure of Payments to Governments is required with respect to payments arising from the explora- tion, discovery, development and extraction of minerals; the payments included within this report therefore relate only to Atalaya´s mining activities.

Groups are required to prepare a consolidated report disclosing payments made by the parent company and its subsidiaries. Accordingly, this report reflects payments made by the Group's companies conducting mining and exploration activities, including Atalaya Riotinto Minera, S.L.U., Cobre San Rafael, S.L., Atalaya Servicios Mineros, SL, Atalaya Masa Valverde S.L.U. and Atalaya Ossa Morena S.L.

OUR APPROACH TO TAX AND TRANSPARENCY

Our economic contributions hold significant importance in the areas where the Groups operates. These contributions extend to providing both direct and indirect employment opportunities for local commu- nities, as well as fostering support for local suppliers. Recognizing the impact we have on local communities and regions, we adopt a responsible and transparent approach in communicating this influence with all stakeholders.

Moreover, we recognize that our license to operate hinges on ensuring that the benefits derived by our stakeholders from our activities pave the way for a sustainable future. This commitment encompasses responsible management of our tax affairs. We strongly believe in providing communities with access to clear information regarding their government's earnings from natural resource extraction. It is crucial for citizens to understand how these revenues contribute to societal development and their country's economic well-being. Transparent information about our payments to the government not only fosters accountability but also diminishes the potential for corruption among all involved parties.

A country that transparently and effectively allocates natural resource wealth for the betterment of its communities stands to attract more responsible and long-term business investments. It is imperative for businesses, governments, and civil society to collaborate in fostering transparency. Upholding transparency and responsibility in our payments to governments is an integral aspect of Atalaya's core values. These values underscore our purpose, priorities, and the inherent principles that govern our conduct.

Furthermore, our pricing strategies for transactions among Group companies are grounded in fair market determination and arms-length commercial equivalence in pricing and terms. This commitment ensures integrity in our financial dealings and upholds the principles of fairness and equity within our corporate framework.

Further information on the impact of Atalaya in the areas where we operate can be found in the Sustainability Report produced by Atalaya on an annual basis.

OUR PAYMENTS TO GOVERNMENTS

The payments disclosed in this report are presented on a cash basis during the reporting period. Any cash refunds for excess payments made in the previous year are offset against current year payments, and if the refunds exceed the payments the net refund is shown as a negative amount in this report.

There are no in-kind payments.

The report includes all such payments for activities which relate to exploration, discovery, development and extraction of copper and its by-products and other materials resulting from extracting activities of each of our operations, including joint operations.

The report also excludes payments related to refining, processing, marketing and trading.

Atalaya Mining Plc. as parent of the group has prepared the report on a consolidated basis and reports the activity of any subsidiaries which are active in the extractive industry.

Unless noted otherwise in the report, the following terms have the meanings noted below:

• Government: any national, regional or local authority of a country and includes any department, agency or undertaking controlled by such an authority.
• Corporate income tax: all taxes that are based on the taxable profits of a company.

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Atalaya Mining Plc

REPORT ON PAYMENTS TO GOVERNMENTS 2023

• Canon & royalties: payments to governments in respect of the use of public roads and infrastruc- tures or payments of revenue or production related to the extraction of copper.
• Property taxes: payments to governments relating to the ownership of the property and lands of the operations.
• Local Fees: licence fees, building licences and other considerations.
• Licences: payments to governments in respect of mining activities

An analysis of payments by project is required where payments are attributable to specific projects. Projects are defined as operational activities which are governed by a single contract, licence, lease, concession or similar legal agreement, and form the basis for payment liabilities with a government. Where agreements are substantially interconnected in operating and geographical terms, with substantially similar terms, those agreements should be treated as a single project. Payments may be disclosed at an entity level where payments are made with respect to obligations imposed at that entity level rather than at a project level.

Materiality

Under the Regulations, a payment need not be disclosed if it is a single payment of less than one thousand euros or a series of related payments in a single year where the total is less than this amount. For the purpose of this report, we have used this threshold and payments below one thousand euros are not included, although in some circumstances payments below this threshold have been voluntarily included.

Rounding

Figures are presented in thousand euros. The amounts shown in this report have been rounded to the nearest €1,000.

PAYMENTS TO GOVERNMENTS

	Business		Corporate
	Country/Project	income tax
Entity	activity
€´000

Canon

Property

taxes

Local Fees

Total

		Cyprus	2,978				2,978
Atalaya Mining Plc	Holding		498				498
EMED Marketing Limited	Trading		2,480				2,480
		Spain	2,210	14	491	659	3,374
Atalaya Riotinto Minera, SLU	Mining	Proyecto Riotinto	2,201	9	439	650	3,308
Cobre San Rafael, SL	Mining	Proyecto Touro					28
Atalaya Masa Valverde, SLU	Mining	Proyecto Masa Valverde					25
Atalaya Servicios Mineros, SLU	Holding				4		4
Atalaya Ossa Morena, SL	Mining	Proyecto Ossa Morena					9

Total

5,188

14

491

659

6,352

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REPORT ON PAYMENTS TO GOVERNMENTS

For the year end 31 December 2023

	La Dehesa s/n	1, Lambousa Street	3, Ayiou Demetriou Street
	Minas de Riotinto,	Nicosia 1095,	Acropolis 2012
atalayamining.com	21660 - Huelva, Spain	Cyprus	Nicosia, Cyprus