Ann: Response to unauthorised anti-mining letter to shareholders, page-2

Response to Unauthorised Letter to Shareholders
Rafaella Resources Limited (ASX:RFR) (‘Rafaella’ or the ‘Company’ has been made
aware of a letter dated 4 March 2022 issued to a number of its larger shareholders by
two members of the Spanish Congress (Parliament) representing a marginal political
party (Letter), and would like to offer the following clarification to its shareholders
regarding misleading statements made in that Letter.
The Company would also like to highlight that despite the letterhead of the Letter,
“Congreso de los Diputados”, the content of the Letter represents the personal views of the
two individual authors and not the Spanish government.
In the Letter, the authors suggest that criminal proceedings have been brought against
various "civil servants and public authorities... regarding illegal permitting and associated
alleged crimes at the San Finx mine”. The Letter states that these proceedings were
"presented in Court in December 13 and January 28". The Company confirms that it is not
aware of these proceedings, however the Court has dismissed and shelved previous cases
submitted by the relevant parties.
The authors of the Letter discuss fines relating to previous "unpaid mandatory discharge
control tax payments” amounting to over €30 million. To the Company's knowledge, having
regard to the information available to it during the due diligence process for the San Finx
acquisition and thereafter, there has been no notification of any such payments due by
Tungsten San Finx SL, owner of the San Finx mine. Tungsten San Finx SL is currently
processing its water discharge permit and is following due process to ensure that any
future operations will remain fully compliant with any and all environmental obligations.
Note that Tungsten San Finx SL has agreed to clean several dams in the area that are not
part of the historical mining operations of San Finx (incorrectly referred to in the Letter as
the "abandoned tailings dams"). This voluntary treatment will be a positive contribution to
the local community and an additional benefit generated from the restart of mining
operations at San Finx, which is still pending administrative approval.
The authors of the Letter state that upon the approval of the water discharge permit, the
Company will be required to construct “an active acid mine drainage treatment facility to
operate in perpetuity” which will “require significant investments”, and then suggest that
“it does not seem Rafaella Resources or its subsidiaries can meet such obligations in the
short-term as expected” As part of the due diligence conducted by the Company during the
acquisition of Tungsten San Finx SL, Rafaella reviewed the budget for the construction of
the water treatment plant as prepared by leading Spanish experts in the field of water
treatment, and full provision has been made for this in the project economics.
The Company strongly denies any wrongdoings and refutes any accusations of any non-
compliance, breach of any regulatory or legal obligations, or inability to meet future capital
cost obligations associated with the recent acquisition of the San Finx mine.


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Managing Director Steven Turner said: “The Letter sent directly to shareholders, was unsolicited and not authorised
by Rafaella. The Board considers that issues or concerns should be addressed through direct discussion and
consultation with the Company so that all shareholders can have the benefit of the Company's response. Rafaella
is also aware of similar misleading information to that contained in the Letter being published elsewhere. I urge
shareholders to contact the Company directly if they have any further questions regarding the Letter or any future
unsolicited and unauthorised communications regarding the matters the subject of the Letter.
Rafaella is committed to a transparent environmental, social and governance reporting framework and is in the
process of completing the first internal review of this framework that reports against the World Economic Forum
guidelines1. In the meantime, the Company continues to advance the San Finx and Santa Comba projects in
compliance with its legal and environmental obligations and develop strategically important domestic supplies of
critical metals in Europe, where the source of these metals can be traced to conflict-free and responsibly managed
operations.”
This announcement has been authorised by the Board of Directors of the Compan