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ANNUAL REPORT

2022

CENTAURUS METALS ANNUAL REPORT 2022

Corporate Directory

DIRECTORS

Mr D M Murcia AM, B. Juris, LL.B Non-Executive Chair

Mr D P Gordon B.Bus, FCA, AGIA, ACG, MAICD Managing Director

Mr B R Scarpelli M.Sc, PMP Executive Director

Mr M D Hancock B.Bus, CA, F Fin Non-Executive Director

Mr C A Banasik B.App.Sc (Physics), M.Sc (Geology), Dip Ed, GAICD Non-Executive Director

Dr N Streltsova MSc, PhD(Chem Eng), GAICD Non-Executive Director

BANKERS

Australia

National Australia Bank Level 14, 100 St Georges Tce Perth WA 6000

Brazil

Banco Inter Avenida Barbacena, 1219 – Santo Agostinho Belo Horizonte - MG – CEP: 30190-924 BRAZIL Telephone: +55 31 2101 7006

STOCK EXCHANGE LISTING

Centaurus Metals Limited’s shares are listed on the Australian Securities Exchange and the OTC Ordinary fully paid shares (ASX code: CTM OTC: CTTZF.)

COMPANY SECRETARY

Mr J W Westdorp B.Bus, CPA, Grad Dip App Sc, MAICD Chief Financial Officer / Company Secretary

PRINCIPAL & REGISTERED OFFICE

Australia

SHARE REGISTRY

Advanced Share Registry Limited

110 Stirling Highway Nedlands WA 6009 Telephone: (08) 9389 8033

AUDITORS

KPMG

Chartered Accountants 235 St Georges Terrace Perth WA 6000

Level 2, 1 Ord Street West Perth WA 6005

PO Box 975 West Perth WA 6872

Telephone: (08) 6424 8420 Email: [email protected] Website: www.centaurus.com.au

Brazil

Edifício Century Tower Rua Maria Luiza Santiago, 200 Santa Lúcia, 17ª Andar - Sala 1703 Belo Horizonte - MG - CEP: 30360-740 BRAZIL

Telephone: +55 31 3194 7750

ANNUAL REPORT CENTAURUS METALS LIMITED

Highlights ......................................................................................4 Chair’s Report ...............................................................................5 Focus for the Year Ahead ............................................................7 Nickel Market & Price ..................................................................8 Environmental, Social & Governance .......................................9 Strategy & Key Assets in Brazil ..............................................11 Jaguar Nickel Sulphide Project ................................................12 Greenfields Exploration Pipeline ............................................21 Jambreiro Iron Ore Project ......................................................22 Corporate ....................................................................................23 Mineral Resources & Ore Reserves .......................................24 Tenement List..............................................................................27 Additional Shareholder Information ........................................28 Corporate Governance Statement...........................................29 Financial Report 31 December 2022 ..................................... 30

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CENTAURUS METALS ANNUAL REPORT 2022

Highlights

EXPLORATION & DEVELOPMENT

→ Updated JORC 2012 Mineral Resource Estimate (MRE) delivered in November 2022, confirming the Jaguar Nickel Sulphide Project as one of the world’s premier near-surface nickel sulphide development projects, with the Jaguar Global MRE growing to now contain an estimated:
- Geotechnical drilling for the final design of the roads and bridges from Tucumá and Ourilândia do Norte to site is complete.
- Jaguar Nickel Sulphide Project was selected as a Strategic Minerals Project by the Brazilian Federal Government as part of a new program designed to support projects deemed strategic to Brazil.
GLOBAL: 108.0Mt @ 0.87% Ni for 938,500 tonnes of contained nickel.
→ Measured and Indicated component of the Global MRE increased by over 100% to:
MEASURED & INDICATED: 85.8Mt @ 0.85% Ni for 730,300 tonnes of contained nickel.
→ High-grade component of the MRE increased to 28.6Mt @ 1.51% Ni for 431,800 tonnes of contained nickel, with 30% of this resource located within 100m of surface.
→ Key work programs for the Jaguar Definitive Feasibility Study (DFS) were well advanced during the year, with the DFS delivery date scheduled for late Q4 2023. Key work programs during 2022 have included:
Industry‐leading engineering firm Ausenco appointed as Lead Engineer to deliver both the process and non‐process plant infrastructure components of the DFS.
Pricing proposals have been received from mining contractors to support the development of the DFS OPEX, open pit optimisations and mine planning work. Commercial and technical evaluation of the proposals is underway.
Process design for the concentrator circuit of the processing facility has been finalised and major equipment pricing received from suppliers. Commercial and technical evaluation is well advanced.
Process design and the layout of the refinery circuit and non-process plant infrastructure (NPI) has commenced.
Set-up of the pilot plant at ALS Laboratories in Perth for the refinery circuit was completed just prior to year-end, with initial results from the multi-phase pilot testwork program (post year end) confirming high leach extraction of nickel at 98.6%.
Initial design and licencing work has commenced to connect to the 230kV national power grid for the Project’s integrated concentrator and refining circuit power requirements.

ENVIRONMENT, SOCIAL & GOVERNANCE (ESG)

→ Meetings and site visits have been held with the Environmental Agency in Para State to progress the environmental licensing program.
→ Positive adherence across all activities to the Company’s formal environmental, social and governance (ESG) policy framework, which was based on the recommendations and principles of two key ESG authorities, Towards Sustainable Mining (TSM) and Principles of Responsible Investment (PRI).
→ Continued assessment of project greenhouse gas (GHG) emissions. The Jaguar Project currently represents a carbon sink, removing about 12,000 tonnes of GHG annually from the atmosphere, which is equivalent to removing ~2,570 internal combustion engine vehicles from the roads each year.
→ Construction training programs launched for local residents, with the intention of training 1,500 people in various trades to enable them to seek work at the Jaguar Project when construction commences.
→ Plant nursery established on site to facilitate the revegetation of some previously cleared farmland. This will allow new forest corridors to be established around the site to assist with the movement, protection and biodiversity of flora and fauna.
→ Progressive upgrades to the road between the town of Tucumã and the Jaguar site, making travel for local residents significantly safer and less time consuming, particularly during the annual wet season.

CORPORATE

→ Cash at 31 December 2022 of $34 million.
→ Former Vale, WMC and BHP executive, Dr Natalia Streltsova, appointed as a Non-Executive Director.
→ Orimco appointed to provide independent financial advisory services in relation to the debt financing of the Jaguar Project development.

4 ANNUAL REPORT CENTAURUS METALS LIMITED

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Chair’s Report

I am pleased to report on what has been another exceptionally busy and productive year for Centaurus Metals.

Despite, at-times, a challenging macro-economic global and market environment, the Centaurus team has made outstanding progress towards our ambition of establishing a major new nickel sulphide mining and processing operation at our flagship Jaguar Nickel Sulphide Project, located in the world-class Carajás mining district of north-eastern Brazil.

Our focus throughout the year has been on the continued advancement of feasibility studies to support the Project development, as well as on drilling and exploration programs to further expand the Mineral Resource base.

I am pleased to say that all of our work programs throughout the year have continued to reinforce the Jaguar Project’s credentials as one of the most significant and robust new nickel sulphide development projects anywhere in the world.

Over the past 12 months, we have maintained the focus on our drilling programs which delivered a landmark update to the Jaguar Mineral Resource base in November 2022. This saw the global Mineral Resource Estimate increase to 108.0Mt @ 0.87% Ni for 938,500 tonnes of contained nickel, with the higher confidence Measured & Indicated Resource categories more than doubling to over 730,000 tonnes of contained nickel metal – a very significant de-risking step for the Project.

This Resource will form the basis of a maiden Ore Reserve estimate for Jaguar, which will be announced as part of the forthcoming Definitive Feasibility Study (DFS).

Work to complete the DFS was also significantly progressed during the course of 2022, with the mine design and scheduling well advanced and pit optimisations and strategic schedules completed.

The open pits (based on the previous December 2021 Mineral Resource) now extend over a continuous strike length of 3km along the strike extent of the Jaguar Deposits. Recent drilling has also provided compelling evidence to support a potential future underground mining operation, delivering exceptionally high nickel grades from some of the deepest holes ever drilled within the Jaguar Project area. A major drilling program targeting the “Jaguar Deeps” is set to kick-off in May.

“

Our pilot testwork program is also well advanced, with results to underpin the design of a final process flowsheet for the refinery circuit. Results to date have shown very high levels of metal extraction from the refining of flotation concentrates, with nickel extraction in the leach circuit of over 98%.

This metallurgical testwork is a pivotal component of the DFS, providing us with vital data to ensure we maximise the value of the Jaguar Project and deliver a premium, high-value product to market.

Unfortunately, bottlenecks at the pilot plant laboratory saw a delay to the start of this testwork program, which has had a flow-on impact on the overall DFS schedule. As a result, we now expect to complete the Jaguar DFS in late Q4 2023, with a Final Investment Decision (FID) targeted for Q3 2024.

While these delays are frustrating, they are an increasing feature of the current global resources industry, which is operating at capacity in the face of lingering labour and supply chain shortages.

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Fortunately, the delay in the DFS does not detract in any way from the exceptional fundamentals of the Jaguar Project and we are confident that the decision to focus on the quality of the work is the right one for shareholders. We are diligently checking off the remaining elements of the DFS and we are confident the final Study will be delivered by year-end.

We also plan to maintain a strong focus on exploration in 2023, in parallel with the completion of the DFS. Development drilling at Jaguar has recently been completed, meaning our drill rigs are now focused exclusively on Resource growth. We are confident that we can upgrade the Jaguar MRE to more than one million tonnes of contained nickel metal firmly cementing the Project’s status as a truly world-scale nickel sulphide deposit.

In light of its size and scale, the Jaguar Project has been selected as a Strategic Minerals Project by the Brazilian Federal Government, recognising its strategic importance for Brazil’s growth and providing Centaurus with access to tailor-made assistance to navigate the steps required implement and develop the Jaguar Project in an environmentally sustainable manner.

We remain extremely confident in our ability to deliver the Project with class-leading ESG credentials, including very low levels of greenhouse gas emissions. This stems from the relatively high-grade nature of the ore, the very high proportion of Brazilian power generated from renewable sources (currently exceeding 80% of the nation’s total power supply) and our plan to produce a value-added nickel sulphate product on site.

This will make the nickel sulphate we produce highly attractive to EV auto-makers who are increasingly focused on where their Class-1 nickel comes from and how it contributes to their overall carbon footprint.

Centaurus maintains a strong focus on our Environmental, Social and Governance (ESG) performance and you can find full details of our initiatives in our inaugural Sustainability Report to be released around the time of the Annual Report.

During the year, we have further strengthened our corporate governance with the appointment of Dr Natalia Streltsova to the board as an independent non-executive Director.

Natalia is a highly credentialled chemical engineer with a wealth of experience in the international resources industry, including extensive experience working with nickel in Brazil. She has made an invaluable contribution to the Centaurus board since her appointment in August, particularly as we have progressed our ongoing metallurgical testwork and pilot plant programs.

With our work programs progressing across multiple fronts, Jaguar remains one of the few large-scale nickel sulphide projects currently being prepared for development anywhere in the world. Excitingly, this development is set to coincide with an exceptionally strong supply/ demand forecast for Class 1 nickel as the world transitions to a low carbon economy.

As always, I would like to sincerely acknowledge the outstanding efforts of the Centaurus team, ably led by our Managing Director Darren Gordon, for their hard work and dedication over the past 12 months. I would also like to thank you – our shareholders – for your ongoing support.

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Didier Murcia

CHAIR

ANNUAL REPORT CENTAURUS METALS LIMITED

Focus for the Year Ahead

→ Undertake all activities safely in an environmentally and socially sustainable manner.

→Maintain aggressive drilling program

at the Jaguar Nickel Sulphide Project to continue to build the global Resource as well as maximise the existing Resource into Measured and Indicated categories and make new discoveries.

→ Complete a Definitive Feasibility Study and inaugural Ore Reserve Estimate.
→Complete offtake agreement in respect to the supply of nickel sulphate from the Jaguar Project.
→Approval of Environmental Impact Assessment (EIA/RIMA) and Mining Lease Application.
→Deliver value to Shareholders in respect to the Jambreiro Iron Ore Project.

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Nickel Market & Price

Nickel has outstanding physical and chemical properties, which make it essential in many thousands of products. Today, its biggest use is in producing metal alloys, with approximately 70% of global nickel production currently used to manufacture stainless steel.

However, it is nickel’s vital contribution to the production of lithium-ion (Li-ion) batteries that is expected to deliver exceptional demand growth for the metal over the coming years. Li-ion batteries – used in Electric Vehicles – are a key element of the global transition to ‘green energy’.

Concern over climate change, the drive towards energy efficiency and the adoption of carbon dioxide emissions targets by governments are all helping to increase interest in renewable energy technologies involving batteries and energy storage. While nickel is not always in the name, its presence in many battery technologies is helping to reduce greenhouse gas emissions - enabling clean energy solutions to be a central part of our effort to tackle global warming.

According to a recent report by the International Energy Agency (IEA), global sales of Electric Vehicles (EVs) increased by around 60% in 2022, surpassing 10 million units for the first time. As a result, one in every seven passenger cars bought globally in 2022 was an EV – compared to just one in 70 in 2017.

EV sales increased in every region of the world as production increased, oil prices rose, and targeted policies were introduced aimed at supporting their take-up in the market. The European Union has announced a ban on the sale of new Internal Combustion Engine (ICE) vehicles from 2035 unless they can operate only on carbon-neutral fuels.

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Most major car manufacturers have now announced plans to aggressively transition away from the production of internal combustion engine vehicles to electric, with key targets including:

→ Audi: Targeting 30% electrified range by 2025, with ICEs planned to be phased out in 2033.
→ BMW: Targeting 50% electrification across the BMW and Mini model ranges by 2030.
→ Ford: US$50B investment to target the delivery of an all-EV line-up in Europe by 2030 and 40% of total sales in the US by 2030.
→ Hyundai: Aim to sell EVs only by 2040.
→ Mazda: Targeting 25% of its model range to be EV by 2030.
→ Mercedes-Benz: Moving to a fully electric line-up by 2030.
→ Mitsubishi: Goal for hybrid and electric cars to account for 50% of sales by 2030 and 100% of global sales by 2035, mostly comprised of full battery-powered vehicles.
→ Nissan: 100% of all new vehicle offerings electrified in the key markets of Japan, China, the US and Europe by the early 2030s.
→ Porsche: Aims to be carbon neutral over its entire value chain by 2030, with 80% of its production output to be more than 80% pure electric.
→ Toyota: Incoming President Koji Sato has signaled he will make pivoting to electrics a priority, with plans to produce about 200,000 EVs in the US annually from 2026 onward. Toyota-owned Lexus will become an EV-only brand by 2035.
→ Volkswagen: The last purely internal combustion-powered platform will be developed in 2026, after which VW will be all in on EV development.
→ Volvo: Half of all sales will come from EVs by 2025 before the entire model line-up goes all-electric by 2030.

British market research firm LMC Automotive forecasts global EV sales of 36.71 million vehicles in 2030, roughly quintupling from 2022 and representing 35% of the new-car market.

Until recently, nickel sulphate represented a relatively niche product, with production of the material amounting to less than 50ktpa of contained nickel up until 2010, or approximately 3% of the total nickel market. Since then, demand for class 1 nickel has driven a fundamental change in the market for nickel sulphate given its key role in the chemistry of cathode active materials for use in batteries.

Lithium-ion batteries utilising nickel-rich cathodes require high purity nickel, typically in the form of nickel sulphate. One of the primary issues facing the nickel industry is the need to develop new high-grade sulphide nickel deposits, which are the most economic and cleanest way to deliver class 1 nickel.

Centaurus’s goal is to have the Jaguar Nickel Sulphide Project in production by 2027, which is expected to coincide with the surging demand for nickel from EV production across the globe.

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Figure 3: Total Nickel Demand by Sector and Scenario, 2020-2040. Source International Energy Agency

8 ANNUAL REPORT CENTAURUS METALS LIMITED

Figure 4: Breast Cancer Awareness Day with Centaurus Niquel team in Tucumã

Environmental, Social & Governance

The Company adopted its formal environmental, social and governance (ESG) policy framework late in 2021. The framework is based on the recommendations and principles of two key ESG authorities:

→ Towards Sustainable Mining (TSM) Principles; and → Principles of Responsible Investment (PRI).

TSM is the Mining Association of Canada’s commitment to responsible mining. It is a set of tools and indicators to drive performance and ensure that key mining risks at any operation are managed responsibly. The PRI defines responsible investment as a strategy and practice to incorporate environmental, social and governance factors in investment decisions and active ownership. The PRI is a global organisation that encourages and supports the uptake of responsible investment practices in the investment industry.

IBRAM (the Brazilian Mining Institute) is a national mining industry group representing most of the major mining companies operating in Brazil. IBRAM adopted TSM as the reference for ESG matters in 2019.

Centaurus’ ESG program combines the TSM and PRI principles with actions to be implemented during exploration and operations. The following initiatives have already been undertaken by the Company to date at the Jaguar Project region:

→ All of Centaurus employees working on the Jaguar Project live in the local town with their families, strengthening the relationship between the Company and the local community;
→ more than 90% of the current project workforce, including employees and outsourced labour, are from the south-eastern region of the State of Pará, where the Jaguar Project is located;
→ more than 80% of the Company’s investment expenditure relating to exploration and development work at the Jaguar Project to date has been awarded to the local community through drilling contracts, engagement of consultants and services and purchase of equipment and supplies; and
→ during the collection of social data, more than 95% of the local community interviewed was in favour of the project.

GHG EMISSIONS

Since January 2022, the Company has been monitoring scope 2 greenhouse gas (GHG) emissions and sinks associated with the Jaguar Project. The main carbon sink is the standing forest. The main source of carbon from the Project at present is the combustion of diesel to run drill rigs.

The Jaguar Project currently represents a carbon sink, removing about 12,000 tonnes of GHG annually from the atmosphere, which is equivalent to removing circa 2,570 internal combustion engine vehicles (4.6 tonne GHG per vehicle per year) from the roads each year.

The Jaguar Project is expected to have GHG emissions less than 97% of global nickel production once in operation. Work done during the DFS on the pressure oxidation circuit indicates that, as a result of the nickel sulphides at Jaguar being able to be oxidised at lower temperatures and pressure than that assumed in the Scoping Study, the amount of oxygen and limestone for residue neutralisation can be reduced, with the benefit being lowering operating costs and lowering GHG emissions.

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CENTAURUS METALS ANNUAL REPORT 2022

PLANT NURSERY & REVEGETATION PROGRAM

The Company has established a plant nursery on site to facilitate the revegetation of some previously cleared farmland. The revegetation program commenced in November 2022 (at the start of the wet season) and will allow new forest corridors to be established around the site to assist with the movement, protection and biodiversity of flora and fauna.

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Figure 5: Plant Nursery at Jaguar Project Site

WATER WELLS

The Company has drilled five water bores to test the presence and flow of groundwater and to assess whether this water can be used for drinking water purposes during exploration and construction.

Bore hole pumping tests on the bores have indicated that low flow rates are to be expected, which is very positive for the overall project development. Hydrogeological modelling of pump test results commenced in December to quantify the flows and aquifer characteristics. Groundwater quality is good and can be discharged to surface water bodies without prior treatment. Groundwater is not required for process water.

CONSTRUCTION TRAINING PROGRAMS

The Company intends to train up to 1,500 people in various trades that will allow them to be able to seek employment once construction of the Jaguar Project commences. The training programs are intended to be conducted in conjunction with local industry training college SENAI, with general skills and OH&S training programs to commence in H2 2023 followed by specific trade training in H1 2024.

Interest by local residents was confirmed by the number of applications received for the various courses, with over 1,900 registrations to date. The courses are expected to be 3 months long on average and residents of the local community will be prioritised in the selection process.

COMMUNITY CONSULTATION

In December 2022, detailed information on the Jaguar Project was presented to the mayors and councillors of the three municipalities in the Project’s locality. The presentations were designed to prepare the local authorities for the official public hearings which will be held as part of the environmental approvals process. The same presentations were also made to the broader community in all three municipalities in January 2023.

COMMUNITY SUPPORT – BRIDGE CONSTRUCTION

In September, an old wooden bridge that connects the village of Ladeira Vermelha to the town of Tucumã (closest urban centre) collapsed. The São Félix do Xingu administration requested for the Company’s support to build a new bridge. The Company supported the work with a donation and the bridge was rebuilt by the local administration, as shown in Figure 6 below.

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Figure 6: Bridge Restoration Ladeira Vermelha Township

101 Refer to ASX Release dated 10 November 2022ANNUAL REPORT CENTAURUS METALS LIMITED

Strategy & Key Assets in Brazil

The Company’s key focus throughout the 2022 calendar year was on the exploration and development of the advanced Jaguar Nickel Sulphide Project, located in the world-class Carajás Mineral Province in Brazil, which was acquired from global mining giant, Vale S.A. (“Vale”) in April 2020.

Through the development of the Jaguar Project, Centaurus’ goal is to become a new-generation nickel sulphide mining company in Brazil, capable of delivering more than 20,000 tonne per annum of Class-1 nickel to global markets over the long term, and to do so in a sustainable and responsible manner that ensures the Company meets the highest possible ESG standards.

The Company plans to develop a long life nickel sulphate business which will be implemented via a process flowsheet that starts with a conventional nickel flotation plant and is followed by a refining circuit which at its core is a pressure oxidation circuit.

Drilling and exploration programs continued throughout the reporting period targeting Resource in-fill, Resource extensions and new discoveries. The 2022 exploration program underpinned

the delivery of an updated MRE for the Jaguar Project in November 2022 totalling 108.0Mt @ 0.87% Ni for 938,500 tonnes of contained nickel[1] . This confirms Jaguar’s status as one of the largest nickel sulphide resources held by an ASX-listed company and the largest outside of the major mining companies.

The Jaguar Definitive Feasibility Study (DFS) was significantly advanced over the course of the year with the timeline for completion of the DFS being driven by the completion of pilot plant testwork on the refinery circuit that is required to produce a high quality nickel sulphate product. The pilot plant test program is scheduled for completion in late April 2023.

The completion of the Definitive Feasibility Study (DFS) is targeted for late Q4 2023, with a Final Investment Decision (FID) scheduled for Q3 2024.

In addition to Jaguar, the Company also holds the advanced Jambreiro Iron Ore Project. Environmental licensing for the Jambreiro Project is currently being refreshed and the Company continues to pursue options to deliver value from this asset.

1 Refer to ASX Release dated 10 November 2022

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Jaguar Nickel Sulphide Project

The Jaguar Nickel Sulphide Project hosts multiple nickel sulphide deposits and exploration targets within a 30km[2] land package in the western portion of the world-class Carajás Mineral Province.

This government initiative is an important step in encouraging mining projects that are significant for Brazil’s growth and to provide project proponents with tailor-made assistance to navigate the steps required towards implementation and development of their ventures in an environmentally sustainable manner.

The Jaguar Project is ideally located close to existing infrastructure, just 35km north of the regional centre of Tucumã (population +35,000) and only 15km north-west of Vale’s large scale Onça Puma Ferronickel operation, which is powered by 230kV power from the national grid. The Company plans to connect to this 230kV power grid as part of the Jaguar Project development.

UPDATED JORC MINERAL RESOURCE ESTIMATE

Centaurus announced a further substantial increase in the MRE for the Jaguar Project in November 2022, confirming Jaguar’s position as a Tier-1 global nickel sulphide development project with class-leading greenhouse gas (GHG) emission credentials.

JAGUAR SELECTED AS A STRATEGIC MINERALS PROJECT

The updated MRE, comprising 108.0Mt @ 0.87% Ni for 938,500 tonnes of contained nickel (Table 1), confirms Jaguar as one of the largest nickel sulphide resources held by an ASX-listed company and the largest outside of the major mining companies.

The Jaguar Nickel Sulphide Project has been selected as a Strategic Minerals Project by the Brazilian Federal Government.

Importantly, the success of the in-fill resource development rogram completed over the last 12 months has resulted in a 100% increase in the Measured & Indicated component of the Resource

The Strategic Minerals Policy is part of the Investment Partnership Program – PPI (Programa de Parcerias de Investimento), a relatively new Brazil governmental initiative designed to support companies while developing their projects across the country. The PPI program supports projects that are identified as strategic mineral projects for Brazil.

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According to the Ministry of Mines and Energy, the Policy confirms strategic priority to be given to projects selected by the Inter-ministerial Committee of Analysis of Strategic Minerals Projects – CTAPME, providing proponents with specialised governmental support for the development of their projects.

CTAPME has members from several governmental agencies, including the Ministry of Mines and Energy, the Science, Technology and Innovation Ministry and the Special Secretariat of Strategic Affairs of the Presidency. The goal is to provide both government and proponents a more efficient and effective pathway to the development of the country’s strategic projects.

Figure 7: The Jaguar JORC MRE Growth

Classifcation*	Mt	Ni %	Cu %	Grade Co ppm	Zn%	Ni	Contained Metal Cu Co	Contained Metal Cu Co	Zn
Measured	14.0	1.06	0.07	391	0.48	149,400	9,800	5,500	67,300
Indicated	71.7	0.81	0.06	238	0.31	580,900	42,300	17,000	223,300
Measured & Indicated Inferred	85.8 22.2	0.85 0.94	0.06 0.09	263 291	0.34 0.24	730,300 208,200	52,000 19,700	22,500 6,500	290,700 53,700
Total	108.0	0.87	0.07	269	0.32	938,500	71,700	29,000	344,400

* Within pit limits cut-off grade 0.3% Ni; below pit limits cut-off grade 0.7% Ni; Totals are rounded to reflect acceptable precision, subtotals may not reflect global totals. All oxide material is considered as waste and therefore not reported as Resources.

Table 1: The Jaguar JORC MRE November 2022

12 ANNUAL REPORT CENTAURUS METALS LIMITED

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to 85.8Mt @ 0.85% Ni for 730,300 tonnes of contained nickel, representing more than 75% of the Global MRE.

The Measured and Indicated component of the MRE is set to underpin the Company’s maiden Ore Reserve Estimate and Definitive Feasibility Study (DFS), due for completion in mid-2023.

The global MRE at Jaguar has increased by 28% since the previous Resource Estimate that was announced in December 2021 and 80% since the Company’s maiden Resource was announced in June 2020 (Figure 7).

Continued successful step-out and extensional drilling has contributed to delivering an exceptional 421,000 tonnes of additional contained nickel metal since the Company’s maiden

Resource in June 2020 (Figure 7), reflecting an impressive track record of defining new resources at the rate of ~165,000 tonnes of contained nickel per annum through a sustained and focused drilling program at Jaguar.

Underpinned by a 0.87% Ni Resource head-grade, Jaguar is expected to be one of the highest grade open-pit nickel sulphide operations globally.

The successful 2022 in-fill drilling program at the Jaguar and Onça Deposits means that more than 75% of the Global MRE is now classified in the higher-confidence Measured and Indicated categories. Measured and Indicated Resources will be available for conversion to Ore Reserves as part of the DFS due for completion in 2023.

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Figure 8: Jaguar Deposit – Nickel grade-tonnage curve. (Nickel cut-off grade is variable for in-pit resources but not less than 0.7% Ni for below-pit Resources).

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----- Start of picture text -----

Ni% Cut-off Grade Tonnes Grade Metal Tonnes
In-pit Below pit Mt Ni % Cu % Co ppm Zn % Ni Cu Co Zn
----- End of picture text -----

0.2	0.7	111.2	0.85	0.06	263	0.31	946,800	72,100	29,300	347,900
0.3	0.7	108.0	0.87	0.07	269	0.32	938,500	71,700	29,000	344,400
0.4	0.7	98.5	0.92	0.07	282	0.34	904,600	69,400	27,800	330,400
0.5	0.7	85.1	0.99	0.08	304	0.36	843,800	64,800	25,800	302,400
0.6	0.7	72.0	1.07	0.08	327	0.37	772,300	62,300	24,800	276,400
0.7	0.7	61.1	1.15	0.09	348	0.38	701,400	54,200	21,300	231,600
0.8	0.8	47.2	1.27	0.10	377	0.40	597,500	45,900	17,800	191,100
0.9	0.9	36.6	1.39	0.11	406	0.43	507,900	38,800	14,900	156,400
1.0	1.0	28.6	1.51	0.11	435	0.45	431,800	32,500	12,400	129,100
1.1	1.1	22.8	1.63	0.12	460	0.46	371,400	27,100	10,500	105,700
1.2	1.2	18.4	1.74	0.13	486	0.48	321,100	23,100	9,000	88,800
1.3	1.3	15.2	1.85	0.13	507	0.49	280,900	19,800	7,700	74,200

• Totals are rounded to reflect acceptable precision, subtotals may not reflect global totals.

Table 2: The Jaguar JORC MRE at various Ni% Cut-Off Grades – November 2022

CENTAURUS METALS LIMITED ANNUAL REPORT 13

CENTAURUS METALS ANNUAL REPORT 2022

In-fill drilling targeting the first three years of operation at Jaguar Central and Onça Preta has returned a Measured Resource estimate of 14.0Mt @ 1.06% Ni for 149,400 tonnes of contained nickel metal. The high-grade and higher confidence resources will be an important part of the early mine plan during the project pay-back period.

The Jaguar mineralisation remains open down-dip at all deposits and locally along strike, with outstanding potential to continue strong resource growth driven by step-out and extensional drilling targeting DHEM conductor plates and greenfields drilling of the extensive regional exploration pipeline.

Importantly, within the Jaguar Global MRE there is a significant high-grade component of 28.6Mt @ 1.51% Ni for 431,800 tonnes of contained nickel metal, which has been estimated using a 1.0% nickel cut-off grade across the total Mineral Resource (see Table 2). The grade-tonnage curve for the project is shown in Figure 8. Within the High-Grade MRE, around 30% of the contained nickel sits less than 100m from surface. This demonstrates that near-surface high-grade resources are available to assist in optimising the project in the early years of operations to support rapid capital payback.

The resource category development has also been very successful in correlating well with the interpretation of the previous Inferred Resource. In addition to providing increasing control on the s also helped develop an important structural model for the Project, which will support resource extension drilling and potential new discoveries.

The Jaguar MRE covers the six Jaguar deposits, two Onça deposits and the Tigre Deposit. The Project also hosts an outstanding pipeline of greenfields targets, and the Company expects to make more discoveries to continue to contribute to the organic growth of the Jaguar Resource.

The Jaguar South, Jaguar Central and Onça Preta Deposits contain the majority of the MRE and are expected to underpin the bulk of the Jaguar DFS Reserve.

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Figure 9: 3D view of the Jaguar and Onça Deposits showing Resource Categories.

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Figure 10: 3D view of the Jaguar and Onça Deposits showing nickel grade of ore blocks.

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RESOURCE IN-FILL, STEP-OUT AND EXTENSIONAL DRILLING PROGRAM

Resource in-fill, extensional and step-out drilling continued at the Jaguar Project throughout the reporting period, with drilling completed up to July 2022 feeding into the MRE update outlined above, and subsequent drilling set to feed into the next MRE Update.

As of the end of February 2023, there were 7 rigs on site (6 diamond and 1 RC) drilling double shift with drilling focused exclusively on step-out, extensional and greenfields drilling targeting resource growth. A new program of drilling targeting the exciting Jaguar Deeps is set to commence in May 2023.

TARGETS FOR ONGOING MINERAL RESOURCE GROWTH

The November 2022 JORC MRE update for the Jaguar Nickel Project is from the six Jaguar deposits, two Onça deposits and the Tigre deposit (refer to detailed MRE Statement on Page 24). Importantly, significant potential remains to expand the Resources from within the current deposits primarily through down-dip drilling, but also though extensional drilling along strike at some of the deposits.

The nature of the hydrothermal mineralisation at the Jaguar Project points to a deep plumbing system which remains to be tested beyond current drill depths. The average drill-hole depth to date is only 230m, with less than 5% of diamond holes (30 out of a total of 601) completed to end-of-hole depths of more than 500m, with all deep holes intersecting stringer to semi-massive nickel mineralisation.

DHEM surveys continue to indicate that the high-grade mineralisation is continuous and open at depth across all deposits. There is also significant potential to extend some of the key deposits along strike in some directions. Drilling for 2023 will focus on both project development (including in-fill, geotechnical and metallurgical drilling) as well as resource growth on multiple target areas.

DEFINITIVE FEASIBILITY STUDY (DFS), PROJECT DEVELOPMENT AND INFRASTRUCTURE INITIATIVES

Significant activity was undertaken during the year in respect to the DFS, project development initiatives and future infrastructure access.

The pilot plant test work for the refinery circuit commenced in January 2023 (at ALS Metallurgy in Balcatta, Western Australia) when the pilot facilities were made available to Centaurus following extensions of piloting work programs of other companies in the piloting queue.

The scope of the Refinery piloting is split into four phases of work as follows:

→ Phase 1: Concentrate feed preparation, pressure leaching, and copper solvent extraction.
→ Phase 2: Zinc and calcium extraction via solvent extraction.
→ Phase 3: Cobalt/magnesium extraction and nickel purification via solvent extraction circuit.
→ Phase 4: Nickel sulphate crystallisation plus zinc and cobalt hydroxide production.

With the delayed start of the pilot, the delivery of the DFS will now occur in late Q4 2023 with FID targeted for Q3 2024, after front-end engineering design (FEED) work is sufficiently advanced to place long-lead orders and the second stage of the environmental approval process (Installation Licence) has been completed.

The environmental approval process is progressing without issue. Several meetings, including an initial site visit, have been held with the Environmental Agency in Para State (SEMAS) to keep them informed on project development activities.

The Company is targeting first production in 2027, subject to confirmation of delivery timelines for long-lead items once the DFS is finalised.

Subsequent to the end of the reporting period, the Company announced strong results from step-out and deeper drilling at the Jaguar Project, confirming the potential for further significant Resource growth towards one million tonnes of contained nickel metal and beyond (see ASX Announcement dated 6 February 2023).

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APPOINTMENT OF AUSENCO AS LEAD ENGINEER

Centaurus appointed global engineering group Ausenco as Lead Engineer for the completion and delivery of the Jaguar Project Definitive Feasibility Study.

Ausenco will provide the majority of study services through its Perth office, with technical and engineering support from its Belo Horizonte office, to ensure that engineering designs conform to Brazilian standards and to ensure that capital and operating costs reflect local supply and installation costs. Ausenco’s key global hydrometallurgical subject matter experts are based in the Perth office.

MINING

Following the completion of open pit optimisations, designs and strategic schedules during the reporting period (based on the December 2021 MRE), the open pits now extend over a continuous strike length of 3km along the strike extent of the Jaguar Deposits. The separate pits identified in the Scoping Study have coalesced into a single pit (Figure 11) up to 1km wide and with depths that extend to over 300m. The Onça pits remain as two separate pits with over 1.5km strike length, with Onça Preta now up to 245m deep. The overall project strip ratio remains low at approximately 7.5 to 1.

New pit optimisation work commenced in March 2023 based on new costs and the MRE delivered in November 2022. This optimisation work will cornerstone the mine design and schedule for the DFS.

Pricing proposals for mining activities at Jaguar have been received from five earthmoving contractors and two explosives suppliers to support the open pit planning work for the DFS. These proposals are under commercial and technical evaluation to select pricing for use in open pit planning for the DFS, utilising the November 2022 MRE orebody model.

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[Figure 11: ][Project Layout at Jaguar]

MINERALOGY

Centaurus has undertaken comprehensive testing and analysis of the mineralogy of the Jaguar Nickel Project as part of which 3km of core, drilled by the Company, was selected for mineralogical testing. The core was selected from geologically important areas across the entirety of the Project’s Resource base, including Jaguar South, Jaguar Central, Jaguar West, Jaguar Central North, Jaguar North, Jaguar North-East, Onça Preta and Onça Rosa. A summary of the location of the samples taken for the mineralogy work is set out in Table 3 below.

The mineralogy work has provided significant understanding of the ore zones at Jaguar, including:

→ the distribution of ore hardness across ore zones;
→ the relative proportions of nickel sulphides (millerite, pentlandite or violarite – see Figure 13);

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Deposit Mt %Ni Ni t % Ni t Samples Metres Analysed
Jaguar South 34.6 0.92 316,500 33.7 91 1,091
Jaguar Central 12.5 0.81 100,400 10.7 54 837
Jaguar North 3.2 1.15 36,600 3.9 15 180
Jaguar Central North 14.2 0.62 88,100 9.4 13 149
Jaguar North-East 16.8 0.75 126,200 13.4 19 244
Jaguar West 8.7 0.72 63,100 6.7 23 205
Onça Preta 14.2 1.23 173,900 18.5 23 190
Onça Rosa 1.8 0.98 18,600 2.0 9 69
Tigre 2.0 0.77 15,100 1.6 - -
Total 108.0 0.87 938,500 100.0 247 2,965
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Table 3: Jaguar Nickel Project Mineralogy Origins

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Figure 12: Jaguar Ore Sample – Fresh sulphides within 3 meters of surface

Global Project Average Sulphides

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Figure 13: Average Sulphide Mineralogy of the Jaguar Nickel Project’s Ore Zones

→ the proportions of recoverable nickel sulphides from the ore zones;
→ the average mineral grain size and associations of the target minerals;
→ important geometallurgical relationships (flotation metal and mass recovery expectations); and
→ for Jaguar ore zones, nickel sulphide recovery is independent of nickel head grade.

From this work the Company has developed a detailed understanding of the ore types at the Jaguar Project, with how to best process them and the resultant concentrate quality produced.

Of particular importance for the concentrator circuit is the determination of sulphide nickel (which is recoverable by flotation). Figure 14 illustrates the sulphide nickel to total nickel relationship for the Jaguar and Onça deposits. There is a consistent background of non-sulphide nickel across the different deposits and, as such, the higher the total nickel grade the lower proportion of non-sulphide nickel losses and the higher nickel flotation recovery that will be achieved.

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FLOTATION TESTWORK

Extensive flotation testwork has been completed on the Jaguar nickel sulphide ore, with over 800kg of high-quality concentrate produced for feed to the Jaguar pilot plant. Variability composites were also prepared and tested. The flotation work has provided an extensive geometallurgical understanding for optimisation of the mining schedule.

The testwork and geometallurgical analysis of the data has defined the following key parameters;

→ concentrate mass recovery;
→ nickel sulphide recovery;
→ copper recovery;
→ sulphur recovery;
→ zinc recovery;
→ cobalt recovery; and
→ ore hardness parameters.

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Figure 14: Average Sulphide Mineralogy of the Jaguar Nickel Project’s Ore Zones

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From the flotation testwork, Centaurus estimates that it will be able to recover approximately 94% of the sulphide nickel processed to a concentrate (which is approximately 78% of the total nickel at the average head grade in the MRE).

The 800kg of bulk concentrate used as feed for piloting of the refinery had the following product specification:

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Ni (%) Cu (%) Ca (%) Zn (%) Al (%)
11.2 0.72 0.31 3.07 0.44
Cl (%) As (%) F (%) Fe (%) K (%)
<0.01 <0.01 <0.01 30.3 0.13
MgO (%) Fe/Mgo (%) Pb (%) S (%) P (%)
2.56 11.9 0.05 36.7 0.42
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Table 4: Pilot Bulk Concentrate Sample Analysis

PILOT PLANT

Centaurus’ piloting program for the Jaguar Project has been developed to provide detailed chemistry and process engineering data for the DFS and FEED requirements, as well as to ensure a high-quality nickel product is achieved for marketing and offtake discussions.

The pilot program will also confirm the by-products that can be produced from the Jaguar process flowsheet so that all viable revenue streams from Jaguar can be considered in the project economics of the DFS.

The pilot plant testwork commenced in January 2023 (at ALS Metallurgy) when the pilot facilities were made available to the Company following extensions of piloting work programs of other companies in the piloting queue.

The scope of the refinery piloting is split into four phases of work as follows:

→ phase 1: Concentrate feed preparation, pressure leaching, and copper solvent extraction.
→ phase 2: Zinc and calcium extraction via solvent extraction.
→ phase 3: Cobalt/magnesium extraction and nickel purification via solvent extraction circuits.
→ phase 4: Nickel sulphate crystallisation plus zinc and cobalt hydroxide production.

Phases 1 – 3 have been completed with Phase 4 underway (due for completion by the end of April 2023).

Phase 1

Phase 1 treated the flotation concentrate, the specification of which is outlined above in Table 4. The flowsheet included oxidative pressure leaching (POX) in an autoclave with cooling by flash recycling, primary neutralisation, copper solvent extraction and secondary neutralisation.

Phase 1 of the pilot plant performed well and generated extensive chemistry and engineering data for the completion of the process design of the refinery, as planned. Of note were the following observations and results:

→ the established flowsheet was able to produce high extractions continuously;
→ the extractions of nickel, copper, zinc, and cobalt sulphides were better than anticipated at 98.6%, 96.6%, 95.6% and 60.8% respectively;
→ only 45% of the sulphides need to be oxidised to achieve the metal extractions which will translate into reduced oxygen consumption and acid generation and savings in neutralisation costs;
→ a 3.5-hour retention time was achieved which was better than the 4-hour leach previously indicated from batch testwork; and
→ the thickening and filtration design data provided better than expected settling/filtration rates and solute recovery.

Further bench scale testwork has been completed by ALS on the pilot feed concentrate to positively verify the scale up relationship between the bench scale tests and the results achieved in continuous piloting. This provides the Company with confidence in using small-scale batch testing for concentrate variability.

Phase 2 & 3

Phase 2 & 3 of the pilot work defines the solvent extraction requirements of the flowsheet.

Phase 2 was designed to extract zinc (for a by-product revenue stream) and soluble calcium from the Phase 1 leach solution with minimal nickel loss, whilst Phase 3 was designed to initially extract cobalt (again for a by-product revenue stream) and magnesium followed by the purification of the nickel solution to produce nickel sulphate.

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Figure 15: Jaguar Pilot Test Facility

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From the Phase 2 solvent extraction work, three product/waste streams are produced:

→ a raffinate primarily containing nickel, cobalt, magnesium and manganese;
→ a zinc strip solution; and
→ a calcium strip solution for waste deposition.

The piloting of zinc and calcium solvent extraction has been completed using D2EPHA extractant and a solvent extraction circuit configuration that was successful in extracting over 99% of the zinc and calcium whilst losing less than 0.8% of the nickel (Table 5).

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Ca Co Mg Mn Ni Zn
Solution (mg/L) (mg/L) (mg/L) (mg/L) (mg/L) (mg/L)
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Product to Phase 3 Future Testing	7	772	2,940	54	37,670	3
Zinc Product Solution	382	<1	0.1	0.6	0.3	43,290

Table 5: Phase 2 Product Average Solution Concentrations

While the product testing has not been fully completed yet, the test work shows that a high purity zinc hydroxide product can be generated providing an additional revenue stream not considered in prior economic assessments of the project. The results from Phase 2 confirmed the initial laboratory scale batch test work results.

Phase 3 was recently completed in March 2023.

Phase 3 was successful in extracting cobalt and magnesium from the Phase 2 raffinate to allow production of a cobalt hydroxide product as well as the purification of the nickel solution to produce nickel sulphate.

Phase 4 is underway and due for completion by the end of April 2023.

The successful completion of the pilot testwork will deliver all necessary data for the completion of the important refinery process design for the DFS as well as producing battery grade nickel product for marketing and offtake discussions.

PROCESS PLANT ENGINEERING

The concentrator section of the processing facility, consisting of crushing, grinding and flotation and thickening circuits, has been finalised and capital equipment packages progressively issued for pricing. Pricing for the major equipment has been received from suppliers, with the commercial and technical evaluation process well advanced.

Layout of the refinery and non-process plant infrastructure commenced towards the end of the reporting period and is expected to be finalised in H1 2023.

INFRASTRUCTURE

Road Upgrades

Early works to facilitate the construction of the project will include the upgrade of up to 60km of gravel roads, drainage culverts and two bridges between the townships of Ourilândia do Norte and Tucumã and site.

Geotechnical drilling for the final design of the roads and bridges from Tucumá and Ourilândia do Norte to site has been completed and laboratory analysis of samples for foundation design and construction materials was nearing completion at the end of the reporting period.

Power Supply

The generation of power for the national power grid in north-eastern Brazil consists of hydro, solar, wind and thermal power generation facilities supplying the national network through a fully interconnected distribution system.

An assessment of power supply options for site during the reporting period determined that the preferred solution to ensure long term supply with better upgrade potential (should project demand increase in the future) is to access the 230kV national distribution system.

Initial design and licencing work commenced to connect to the 230kV national grid, including the assessment of the preferred route and interconnection options. Initial meetings with the Ministry of Mines & Energy were held in January 2023 to formally discuss the Project and its power requirements and to commence electrical engineering and permitting processes.

Tailings Storage Facility Designs

Two tailings storage facilities will be built on site to contain processing tailings because of differing geochemical characteristics and risk classification. The flotation tailings, comprising approximately 90% of the process tailings stream, will be stored in an Integrated Waste Landform (IWL) style facility. Residue from the pressure oxidation circuit, which accounts for approximately 10% of the process waste stream and which will contain elevated levels of some metals and sulphates, will be stored in a separate POX residue facility.

Due to limited suitable construction material (mostly suitable clays) at Jaguar, the IWL will be constructed with a partial HDPE lining (walls only) to limit potential for seepage. The POX residue will be dewatered using a filter press to produce a filter cake product with lower moisture content before being stacked inside a fully HDPE plastic lined facility to ensure no loss of potential leachates from this facility. The POX residue facility will comprise four cells, with cells to be progressively built over the life of the mine as production dictates.

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Figure 16: Jaguar Project Core Shed

New Site Core Shed

The Company completed the construction of a new site core shed, (Figure 16) which has the capacity to store close to 300,000 metres of core.

Centaurus commenced the process of setting up of the shelving system at the new shed and moving the core from the existing shed in Tucumá to site.

On Site Accommodation

Following the purchase of the possession rights for the third land parcel in 2021, the Company is now using the farmhouse that came as part of the acquisition as a base for new on-site accommodation. Upgrade work of this site was completed in July 2022. This work has increased the on-site housing capacity at Jaguar (across two sites) to over 160 people.

Sterilisation Drilling of Major Infrastructure Areas

More than 6,000m of RC sterilisation drilling has been completed covering all areas at the project where major infrastructure is proposed to be located. Sterilisation drilling first tested priority exploration targets over planned infrastructure as well as pattern drilling. Importantly, no economic mineralisation has been intersected in the sterilisation drilling and the Company is satisfied that that the major infrastructure sites have been sterilised.

Key Appointments – Project Execution Team

The Company has made several key personnel appointments to support the delivery of the DFS and future FEED work. The appointments bring a wealth of additional experience in the resource sector and significantly add to the existing process engineering, metallurgy and hydrometallurgical experience within the group.

Key appointments include Mick Ryan as Project Manager, Sarah Mitchell as Consultant Metallurgist, Barun Dutta as Engineering Manager, Glenn Firth as Environmental and Compliance Specialist, and Richard Kelly as Project Engineer.

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Figure 17: Canaã Camp & Core Layout Facility

OFF-TAKE DISCUSSIONS

Off-take discussions are continuing in relation to the products to be produced from Jaguar. Vale has the right to product at arm’s length market-based pricing under the original acquisition agreement for the Jaguar Project. Centaurus retains discretion over what nickel products will be produced at Jaguar.

The introduction of the Inflation Reduction Act by the US Government has highlighted the strategic importance of energy metals like nickel and, in particular, those that can be sourced in geopolitically stable jurisdictions with a low-emission footprint.

Brazil fits these criteria well as it is South America’s largest pro-mining jurisdiction, the 8[th] largest global economy and currently more than 80% of the country’s grid power is delivered from renewable sources. It is anticipated that the Jaguar Project will be able to secure 100% renewably sourced power by the time it is in production.

With its very large metal endowment, the Jaguar Project is extremely well placed to capitalise on the fast-growing EV and battery metals market.

PROJECT FINANCE

Centaurus has appointed Orimco Pty Ltd to provide independent financial advisory services in relation to the debt financing of the Jaguar Project.

Orimco is a leading advisory firm providing services to resource companies and wholesale investors focused on the global mining industry. The Orimco team has extensive experience arranging and managing debt and hedging transactions for both resource companies and financiers. Orimco has provided advisory services to resource companies across a broad range of projects, commodities (including recent nickel experience), and jurisdictions.

The team is led by highly experienced mining executives Nick Harch, Brett Gossage and John Fitzgerald.

The appointment of Orimco will ensure that the outcomes and deliverables of the ongoing DFS meet the requirements of debt financiers and support a competitive financing process.

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Greenfields Exploration Pipeline

The Jaguar Project sits at the intersection of two of the most important mineralising structures in the Carajás Mineral Province, the Canãa and McCandless Faults. At Jaguar, the close association of semi-massive and massive sulphides with magnetite means that, when targeting new mineralisation, coincident geochemical, electromagnetic and magnetic anomalies are the highest priority targets. This is evidenced in the Ground Magnetics surveys in Figure 18 below.

Multiple prospects and targets which are located along the main mineralisation structures and characterised by ground magnetic and airborne and/or ground electromagnetic (EM) anomalies coincident with significant soil geochemical anomalies remain to be drill tested.

During the year, the Company commenced greenfields exploration on two recently granted Exploration Licenses. Both projects are located within 30km of the proposed Jaguar plant site and if a nickel sulphide discovery was made could contribute to the Jaguar project as a simple satellite operation. Both tenements are 100%-owned by the Company.

SANTA INÊS PROJECT

Located 15km[2] north-west of the Jaguar Project. The 18 km[2] exploration lease is positioned on a strand of the regionally significant Canaã Fault which is the same structure that is understood to have been critical in the mineralisation processes of the Jaguar Deposit. Mapping has identified a mafic intrusion on the project. Rock-chip and soil geochem assays are expected in the coming months.

TERRA ROXA PROJECT

The 29km[2] exploration lease is located 30km south-west of the Jaguar Project. The project is located on the McCandless Fault which traverses the Jaguar Project through the Puma Layered Mafic-Ultramafic Complex and is understood to be the source of nickel for the hydrothermal mineralisation seen at Jaguar. Terra Roxa is located immediately south of Vale’s Mundial nickel-laterite deposit which is the laterite cap of another mafic-ultramafic intrusion.

The Company has completed landowner access agreements and started early-stage exploration including mapping, rock-chip and soil sampling on the 100%‐owned projects. Geophysical surveys and first-pass RC-drilling will be planned once exploration targets have been determined.

Drilling of the greenfields exploration pipeline will be undertaken systematically over the next 18 months using the RC rig, and diamond rigs will be dedicated to projects once a discovery is made.

CURIONÓPOLIS PROJECT

The Company’s 100%‐owned Curionópolis Project is a group of four recently granted exploration leases covering 51km[2] located 15km east of Oz Minerals Antas Norte Cu-Au operation in the Eastern Carajás. The tenements cover more than 15km of strike of the highly prospective Itacaiúnas Supergroup (which hosts all IOCG deposits within the Carajás Mineral Province) coincident with a strong continuous aeromagnetic anomaly.

The Company has started landowner access agreements and once all agreements are complete will start early-stage exploration including mapping, soil sampling and geophysical surveys.

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Figure 18: The Jaguar Nickel Project – Soils Geochemistry (Ni) over Ground Magnetics (Analytic Signal)

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Jambreiro Iron Ore Project

The 100%‐owned Jambreiro Project is located in south‐east Brazil, close to the Company’s head office in the city of Belo Horizonte.

The Company has commenced the process to refresh all environmental licences required to develop the project. As part of this process, Supram (the Minas Gerais environmental agency) has advised that new wet and dry season environmental data will need to be collected to support a new Installation Licence (LI) application given the age of the data used in the originally approved LI. The new data has been collected over the last 3 months, with the new application targeted for lodgement in July 2023. Approval is anticipated to be 12 months from lodgement. The Company has also lodged the documentation to re-apply for all water permits necessary to operate the project.

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Corporate
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APPOINTMENT OF NON-EXECUTIVE DIRECTOR

During the year, the Company appointed highly experienced mining executive and company director, Dr Natalia Streltsova, to its board as an independent non-executive Director.

Dr Streltsova brings a wealth of international experience at senior executive levels in the resource industry – including in Brazil and with a particular focus in nickel – making her an ideal addition to the Centaurus board as the Company continues to advance the development of the Jaguar Project.

The appointment is consistent with the Company’ commitment to continue to strengthen and evolve its senior leadership team to ensure it has the appropriate level of skills, experience and diversity at both board and senior management levels to oversee its next stage of growth as a sustainable international mining company.

During her 29-year career, Dr Streltsova has spent over 12 years in various technical and senior executive roles with major mining houses including Vale, BHP Billiton and WMC Resources. A Chemical Engineer with both an MSc and PhD, Dr Streltsova spent the early part of her career working in chemical research before taking on several mining industry roles where she had considerable interaction with operations to provide support and to identify technical opportunities for efficiency improvements and cost reductions. She was Program Leader – Hydrometallurgy and Project Manager for WMC Resources between 2000 and 2005, working on a range of projects including Mt Keith and Olympic Dam; Team Leader – Hydrometallurgy and Technology Development Manager for BHP Billiton between 2005 and 2008;

Manager Development and Technical Solutions for GRD Minproc (2008) and Director, Technical Development, for Vale SA in Brazil between 2008 and 2012.

In the past ten years her focus has been on non-executive board memberships and consulting. She is a non-executive Director of Ramelius Resources (ASX: RMS), non-executive director of Neometals (ASX: NMT) and non-executive Chair of Australian Potash (ASX: APC). She was a non-executive Director of Western Areas (ASX: WSA) from 2017 until its takeover by IGO Limited during the year.

$75M INSTITUTIONAL SHARE PLACEMENT

Centaurus completed an institutional share placement in January 2022 which raised $75 million to underpin the growth and development of the Jaguar Project.

There was very strong demand for the placement from Australian and international institutional investors as well as existing substantial shareholders, including affiliates of the Sprott Group, McCusker Holdings, Dundee Goodman Merchant Partners and Harmanis Holdings.

CASH POSITION

At 31 December 2022, the Company held cash reserves of A$34 million.

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Mineral Resources & Ore Reserves

TOTAL MINERAL RESOURCES & ORE RESERVES STATEMENT

The Company’s Mineral Resource for its nickel holding is shown in the following tables.

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Grade Contained Metal
Deposit Classification Mt Ni % Cu % Co ppm Zn % Ni Cu Co Zn
Indicated 27.6 0.87 0.05 198 0.13 240,300 13,000 5,500 37,200
Jaguar South Inferred 7.0 1.10 0.07 262 0.09 76,300 4,600 1,800 6,400
Total 34.6 0.92 0.05 211 0.13 316,500 17,600 7,300 43,600
Measured 8.9 0.88 0.05 252 0.56 78,600 4,900 2,300 50,400
Indicated 2.9 0.61 0.04 207 0.24 17,300 1,000 600 6,700
Jaguar Central
Inferred 0.7 0.68 0.05 210 0.19 4,500 300 100 1,200
Total 12.5 0.81 0.05 239 0.47 100,400 6,200 3,000 58,400
Indicated 2.7 1.14 0.17 383 1.19 30,900 4,500 1,000 32,200
Jaguar North Inferred 0.5 1.19 0.23 387 1.16 5,700 1,100 200 5,600
Total 3.2 1.15 0.18 383 1.19 36,600 5,600 1,200 37,800
Indicated 10.2 0.61 0.04 189 0.62 62,000 3,600 1,900 63,500
Jaguar Central North Inferred 4.0 0.66 0.04 197 0.44 26,100 1,700 800 17,600
Total 14.2 0.62 0.04 191 0.57 88,100 5,300 2,700 81,100
Indicated 13.3 0.71 0.09 269 0.50 95,100 11,700 3,600 66,100
Jaguar Northeast Inferred 3.5 0.89 0.21 317 0.55 31,200 7,200 1,100 19,300
Total 16.8 0.75 0.11 279 0.51 126,200 18,900 4,700 85,400
Indicated 7.8 0.72 0.03 168 0.13 56,200 2,300 1,300 9,800
Jaguar West Inferred 0.9 0.75 0.04 157 0.05 6,900 300 100 400
Total 8.7 0.72 0.03 167 0.12 63,100 2,600 1,500 10,200
Measured 8.9 0.88 0.05 252 0.56 78,600 4,900 2,300 50,400
Indicated 64.5 0.78 0.06 216 0.33 501,800 36,100 13,900 215,500
Jaguar Deposits
Inferred 16.5 0.91 0.09 254 0.31 150,500 15,200 4,200 50,500
Total 89.9 0.81 0.06 226 0.35 730,900 56,200 20,400 316,400
Measured 5.1 1.39 0.10 636 0.33 70,800 4,900 3,200 17,000
Indicated 4.5 1.19 0.09 517 0.15 53,800 4,100 2,300 6,900
Onça Preta
Inferred 4.5 1.08 0.08 436 0.07 49,200 3,700 2,000 3,000
Total 14.2 1.23 0.09 534 0.19 173,900 12,700 7,600 26,900
Indicated 1.9 0.98 0.08 281 0.03 18,200 1,400 500 500
Onça Rosa Inferred 0.04 0.92 0.05 304 0.02 400 20 10 10
Total 1.9 0.98 0.07 282 0.03 18,600 1,400 500 500
Indicated 0.8 0.86 0.09 303 0.04 7,100 700 200 300
Tigre Inferred 1.2 0.70 0.06 248 0.02 8,100 700 300 300
Total 2.0 0.77 0.07 271 0.03 15,100 1,400 500 600
Measured 14.0 1.06 0.07 391 0.48 149,400 9,800 5,500 67,300
Indicated 71.7 0.81 0.06 238 0.31 580,900 42,300 17,000 223,300
Jaguar MRE
Inferred 22.2 0.94 0.09 291 0.24 208,200 19,700 6,500 53,700
Total 108.0 0.87 0.07 269 0.32 938,500 71,700 29,000 344,400
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24 ANNUAL REPORT CENTAURUS METALS LIMITED

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Classifcation*	Mt	Ni %	Cu %	Grade Co ppm	Zn%	Ni	Contained Metal Cu Co	Contained Metal Cu Co	Zn
Measured	14.0	1.06	0.07	391	0.48	149,400	9,800	5,500	67,300
Indicated Measured & Indicated	71.7 85.8	0.81 0.85	0.06 0.06	238 263	0.31 0.34	580,900 730,300	42,300 52,000	17,000 22,500	223,300 290,700
Inferred	22.2	0.94	0.09	291	0.24	208,200	19,700	6,500	53,700
Total	108.0	0.87	0.07	269	0.32	938,500	71,700	29,000	344,400

The Company’s Ore Reserves and Mineral Resource for its iron ore holdings are shown in the following tables.

		Ore	Reserves as at	31 December 2022	31 December 2022			Ore	Reserves as at	31 December 2021	31 December 2021
Project	Million Tonnes	Fe %	SiO2 %	Al2O3 %	P %	LOI %	Million Tonnes	Fe %	SiO2 %	Al2O3 %	P %	LOI %
Jambreiro Project *
Proved	35.4	28.5	49.6	4.3	0.04	1.7	35.4	28.5	49.6	4.3	0.04	1.7
Probable	13.1	27.2	49.0	5.3	0.04	2.4	13.1	27.2	49.0	5.3	0.04	2.4
TOTAL	48.5	28.1	49.4	4.6	0.04	1.9	48.5	28.1	49.4	4.6	0.04	1.9

*20% Fe cut-off grade applied; Mine Dilution - 2%; Mine Recovery - 98%;

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Mineral Resources as at 31 December 2022 Mineral Resources as at 31 December 2021
Million Fe P LOI Million Fe P LOI
Project Tonnes % SiO2 % Al2O3 % % % Tonnes % SiO2 % Al2O3 % % %
Jambreiro Project
Measured 44.3 29.2 50.5 3.9 0.04 1.6 44.3 29.2 50.5 3.9 0.04 1.6
Indicated 37.7 27.5 51.1 3.7 0.04 1.7 37.7 27.5 51.1 3.7 0.04 1.7
Inferred 45.1 27.3 52.7 3.3 0.05 1.3 45.1 27.3 52.7 3.3 0.05 1.3
TOTAL 127.1 28.0 51.4 3.7 0.05 1.5 127.1 28.0 51.4 3.7 0.05 1.5
Canavial Project
Indicated 6.5 33.6 33.6 7.1 0.10 7.9 6.5 33.6 33.6 7.1 0.10 7.9
Inferred 21.1 29.6 38.0 5.7 0.07 5.9 21.1 29.6 38.0 5.7 0.07 5.9
TOTAL 27.6 30.5 37.0 6.0 0.07 6.4 27.6 30.5 37.0 6.0 0.07 6.4
Passabém Project
Indicated 2.8 33.0 48.8 1.9 0.03 0.6 2.8 33.0 48.8 1.9 0.03 0.6
Inferred 36.2 30.9 54.0 0.7 0.07 0.1 36.2 30.9 54.0 0.7 0.07 0.1
TOTAL 39.0 31.0 53.6 0.8 0.07 0.1 39.0 31.0 53.6 0.8 0.07 0.1
TOTAL
193.7 29.0 49.8 3.4 0.05 1.9 193.7 29.0 49.8 3.4 0.05 1.9
COMBINED
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*20% Fe cut-off grade applied; ** 27% Fe cut-off grade applied; Mineral Resources are reported inclusive of Ore Reserves. Totals are rounded to reflect acceptable precision, subtotals may not reflect global totals.

MINERAL RESOURCES AND ORE RESERVES ANNUAL STATEMENT AND REVIEW

The Company carries out an annual review of its Mineral Resources and Ore Reserves as required by the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the JORC Code) 2012 edition and the ASX Listing Rules. An update of the Jaguar Nickel Project Mineral Resource was completed on 10 November 2022 and a review was carried out as at 31 December 2022. The Jaguar Resource estimates have been reported in accordance with the JORC Code 2012 edition and the ASX Listing Rules.

The review of the iron ore Mineral Resources and Ore Reserves was carried out as at 31 December 2022. The Jambreiro Resources and

Reserve estimate have been reported in accordance with the JORC Code 2012 edition and the ASX Listing Rules. The remaining Mineral Resource estimates were prepared and disclosed under the JORC Code 2004 edition.

The information prepared for the Canavial, and Passabém Resource estimates have not been updated to comply with the JORC Code 2012 edition on the basis that the information has not materially changed since it was last reported.

The Company is not aware of any new information or data that materially affects the information included in this Annual Statement and confirms that all material assumptions and technical parameters underpinning the estimates in the relevant market announcement continue to apply and have not materially changed.

CENTAURUS METALS LIMITED ANNUAL REPORT

CENTAURUS METALS ANNUAL REPORT 2022

ESTIMATION GOVERNANCE STATEMENT

The Company ensures that all Mineral Resource and Ore Reserve calculations are subject to appropriate levels of governance and internal controls. Exploration Results are collected and managed by competent qualified staff geologists and overseen by the Exploration General Manager. All data collection activities are conducted to industry standards based on a framework of quality assurance and quality control protocols covering all aspects of sample collection, topographical and geophysical surveys, drilling, sample preparation, physical and chemical analysis and data and sample management.

Mineral Resource and Ore Reserve estimates are prepared by qualified independent Competent Persons and further verified by the Company’s technical staff. If there is a material change in the estimate of a Mineral Resource, the modifying factors for the preparation of Ore Reserves, or reporting an inaugural Mineral Resource or Ore Reserve, the estimate and supporting documentation in question is reviewed by a suitably qualified independent Competent Person.

APPROVAL OF MINERAL RESOURCES AND ORE RESERVE STATEMENT

The Company reports its Mineral Resources and Ore Reserves on an annual basis in accordance with the JORC Code 2012 Edition.

The Ore Reserves and Mineral Resources Statement is based on and fairly represents information and supporting documentation prepared by competent and qualified independent external professionals and reviewed by the Company’s technical staff. The Ore Reserves and Mineral Resources Statement has been approved by Roger Fitzhardinge, a Competent Person who is a Member of the Australasian Institute of Mining and Metallurgy. Roger Fitzhardinge is a permanent employee of Centaurus Metals Limited. Mr Fitzhardinge has consented to the inclusion of the Statement in the form and context in which it appears in this Annual Report.

COMPETENT PERSON’S STATEMENT

Jaguar Nickel Project

The information in this Annual report that relates to Exploration Results is based on information compiled by Mr Roger Fitzhardinge who is a Member of the Australasia Institute of Mining and Metallurgy. Mr Fitzhardinge is a permanent employee and shareholder of Centaurus Metals Limited. Mr Fitzhardinge has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Fitzhardinge consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

The information in this Annual report and the November 2022 Mineral Resources is based on that relates to the Jaguar Mineral Resource is based on information compiled by Mr Lauritz Barnes (consultant with Trepanier Pty Ltd) and Mr Roger Fitzhardinge (a permanent employee and shareholder of Centaurus Metals Limited). Mr Barnes and Mr Fitzhardinge are both members of the Australasian Institute of Mining and Metallurgy. Mr Barnes and Mr Fitzhardinge have sufficient experience of relevance to the styles of mineralisation and types of deposits under consideration, and to the activities undertaken to qualify as Competent Persons as defined in the 2012 Edition of the Joint Ore Reserves Committee (JORC) Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Specifically, Mr Fitzhardinge is the Competent Person for the database (including all drilling information), the geological and mineralisation models plus completed the site visits. Mr Barnes is the Competent Person for the construction of the 3-D geology / mineralisation model plus the estimation. Mr Barnes and Mr Fitzhardinge consent to the inclusion in this report of the matters based on their information in the form and context in which they appear.

Jambreiro Iron Ore Project

The information in this report that relates to Jambreiro Mineral Resources is based on information compiled by Roger Fitzhardinge who is a Member of the Australasian Institute of Mining and Metallurgy and Volodymyr Myadzel who is a Member of Australian Institute of Geoscientists. Roger Fitzhardinge is a permanent employee of Centaurus Metals Limited and Volodymyr Myadzel was the Senior Resource Geologist of BNA Mining Solutions, independent resource consultants engaged by Centaurus Metals, at the time when the Mineral Resource estimate was first completed. Roger Fitzhardinge and Volodymyr Myadzel have sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which they are undertaking to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Roger Fitzhardinge and Volodymyr Myadzel consent to the inclusion in the report of the matters based on their information in the form and context in which it appears.

The information in this report that relates to Ore Reserves is based on information compiled by Beck Nader who is a professional Mining Engineer and a Member of the Australian Institute of Geoscientists. Beck Nader is the Managing Director of BNA Mining Solutions and was a consultant to Centaurus. Beck Nader has sufficient experience, which is relevant to the style of mineralisation and type of deposit under consideration and to the activity, which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Beck Nader consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

ANNUAL REPORT CENTAURUS METALS LIMITED

Tenement List

BRAZILIAN TENEMENTS

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Tenement Project Name Location Interest
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831.638/2004 831.639/2004 831.649/2004 833.409/2007 834.106/2010 831.645/2006 830.588/2008 833.410/2007 856.392/1996 850.475/2016 851.571/2021 851.563/2021 850.071/2014 851.767/2021 851.768/2021 851.769/2021	Canavial Canavial Jambreiro (Mining Lease) Jambreiro (Mining Lease) Jambreiro (Mining Lease) Passabém Passabém Regional Guanhães Jaguar (Mining Lease Application) Itapitanga Terra Roxa (Jaguar Regional) Santa Inês (Jaguar Regional) Curionópolis Project Curionópolis Project Curionópolis Project Curionópolis Project	Minas Gerais Minas Gerais Minas Gerais Minas Gerais Minas Gerais Minas Gerais Minas Gerais Minas Gerais Pará Pará Pará Pará Pará Pará Pará Pará	100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%

AUSTRALIAN TENEMENTS

Tenement	Project Name	Location	Interest
EPM14233	Mt Isa	Queensland	10%(1)

(1) Subject to a Farm-Out and Joint Venture Exploration Agreement with Summit Resources (Aust) Pty Ltd. Summit has earned a 90% interest in the Project. Aeon Metals Limited has acquired 80% of Summits Interest giving them a total interest of 72% of the tenement.

CENTAURUS METALS LIMITED ANNUAL REPORT

CENTAURUS METALS ANNUAL REPORT 2022

Additional Shareholder Information

The shareholder information set out below was applicable as at 31 March 2023.

SUBSTANTIAL SHAREHOLDERS

The Company had the following substantial shareholders.

→ McCusker Holdings Pty Ltd 13.9%
→ Sprott Asset Management 6.0%
→ Regal Funds Mgt 5.9%
→ Dundee Resources 5.3%
→ Harmanis Holdings Pty Ltd 5.1%

CLASS OF SHARES AND VOTING RIGHTS

There were 3,419 holders of ordinary shares in the Company as at the above date. The voting rights attaching to the ordinary shares are that on a show of hands every member present in person or by proxy shall have one vote and upon a poll each share shall carry one vote.

As at the above date the Company had the following unlisted options over 10,569,464 ordinary shares. There are no voting rights attached to the unissued ordinary shares. Voting rights will attach to the unissued ordinary shares when the options have been exercised.

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Subject to
Number Number Exercise Expiry
Vesting
of Holders of Options Price $ Date
Conditions
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1 3 4 1 3 7 8 7	116,667 1,400,000 3,952,402 233,334 1,400,000 1,395,452 1,225,220 846,389	0.180 0.392 - 0.180 0.405 - - -	31/05/23 31/05/23 31/12/23 31/05/24 31/05/24 31/12/24 31/12/25 31/12/26	No No No No No Yes Yes Yes

RESTRICTED SECURITIES

There are currently no restricted securities or securities subject to voluntary escrow on issue.

ON-MARKET BUY BACK

There is no current on-market buy back.

DISTRIBUTION OF EQUITY SECURITIES

The distribution of numbers of equity security holders by size of holding is shown in the table below. There were 379 holders of less than a marketable parcel (being a minimum $500 parcel at $0.94 per share) of ordinary shares.

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Unlisted Options Performance
From To Ordinary Shares Listed Options Unlisted Options
(ESOP) Rights
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1 1,001 5,001 10,001 100,001	1,000 5,000 10,000 100,000 and over	647 855 563 1,088 266 3,419	- - - - - -	- - - - 3 3	- - - 4 3 7	- - - -

28 ANNUAL REPORT CENTAURUS METALS LIMITED

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SHAREHOLDERS

The names of the twenty largest holders of ordinary shares (CTM) are listed below:

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Percentage of
Number Held
Issued Shares (%)
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	Number Held Percentage of Issued Shares (%)
1 Citicorp Nominees Pty Limited 2 McCusker Holdings Pty Ltd 3 HSBC Custody Nominees 4 Harmanis Holdings Pty Ltd 5 BNP Paribas Noms Pty Ltd 6 Mr Bradley George Bolin 7 UBS Nominees Australia Pty Ltd 8 J P Morgan Nominees Australia Pty Limited 9 Lujeta Pty Ltd 10 Mr Darren Gordon 11 Mr Roger Fitzhardinge 12 Jayleaf Holdings Pty Ltd 13 Atlas Iron Limited 14 Zero Nominees 15 Merrill Lynch (Australia) Nominees Pty Limited 16 Precision Opportunities Fund Ltd 17 BPM Investments Limited 18 HS Superannuation Pty Ltd 19 Neweconomy Com Au Nominees Pty Limited 20 Mr Luigi Reghelin Total Top 20 Shareholders Other Shareholders Total Number of Issued Shares	95,541,852 22.37% 59,250,000 13.87% 24,029,126 5.63% 21,573,569 5.05% 17,967,475 4.21% 12,004,706 2.81% 11,929,469 2.79% 10,012,556 2.34% 8,500,000 1.99% 6,335,546 1.48% 6,150,724 1.44% 6,000,000 1.40% 4,021,351 0.94% 3,706,429 0.87% 3,284,451 0.77% 3,125,374 0.73% 3,000,000 0.70% 2,445,392 0.57% 2,365,564 0.55% 2,000,000 0.47%
	303,243,584 71.00%
	123,862,689 29.00%
	427,106,273

Corporate Governance Statement

A copy of Centaurus’ 2022 Corporate Governance Statement, which provides detailed information about governance, and a copy of Centaurus’ Appendix 4G which sets out the Company’s compliance with the recommendations in the fourth edition of the ASX Corporate Governance Council’s Principles and Recommendations is available on the corporate governance section of the Company’s website at

www.centaurus.com.au/corporate-governance.

CENTAURUS METALS LIMITED ANNUAL REPORT

CENTAURUS METALS ANNUAL REPORT 2022

FINANCIAL REPORT

31 December 2022

Centaurus Metals Limited ABN 40 009 468 099

And its controlled entities

Directors’ Report .................................................................................................................................................................. 331 Consolidated Statement of Profit or Loss and Other Comprehensive Income ................................................................... 2553 Consolidated Statement of Financial Position .................................................................................................................... 2654 Consolidated Statement of Changes in Equity.................................................................................................................... 2755 Consolidated Statement of Cash Flows .............................................................................................................................. 2856 Notes to the Consolidated Financial Statements ............................................................................................................... 2957 Directors’ Declaration ......................................................................................................................................................... 5179 Independent Auditor’s Report ............................................................................................................................................ 5280

ANNUAL REPORT CENTAURUS METALS LIMITED

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Directors’ Report

Your directors present their report on the Consolidated Entity (“Group”) consisting of Centaurus Metals Limited (“Centaurus” or “the Company”) and the entities it controlled at the end of, or during, the year ended 31 December 2022 together with the consolidated financial report and accompanying audit report.

1 Directors

The directors of the Company at any time during or since the end of the year are:

 Mr D M Murcia Independent Non-Executive Chair  Mr D P Gordon Managing Director  Mr B R Scarpelli Executive Director  Mr M D Hancock Independent Non-Executive Director  Mr C A Banasik Independent Non-Executive Director  Dr N Streltsova Independent Non-Executive Director (appointed 15[th] August 2022)

Unless otherwise disclosed, all directors held their office from 1 January 2022 until the date of this report.

2 Directors and Officers

Mr Didier M Murcia, AM, B.Juris, LL.B

Non-Executive Chair, Age 60

Independent non-executive director appointed 16 April 2009 and appointed Chair 28 January 2010. Lawyer with over 30 years’ legal and corporate experience in the mining industry. Mr Murcia is currently Honorary Australian Consul for the United Republic of Tanzania. He is Chair and founding director of Perth-based legal group MPH Lawyers. He is Chair of Strandline Resources Limited.

During the last three years Mr Murcia has held directorships in the following ASX listed companies:

Alicanto Minerals Limited (appointed 30 May 2012) - Non-Executive Director
Strandline Resources Limited (appointed 23 October 2014) - Non-Executive Chair

Mr Darren P Gordon, B.Bus, FCA, AGIA, ACG, MAICD

Managing Director, Age 51

Managing Director appointed 4 May 2009. Mr Gordon is a Chartered Accountant with over 25 years’ resource sector experience as a senior finance and resources executive. He is a member of both the Governance Institute of Australia and the Institute of Company Directors. He has more than 12 years’ experience in Brazil and has developed an extensive network of contacts within Government, the resources industry and the broader business community in country. He has developed significant exposure to a number of different resource commodities as Managing Director of the Company and lead the negotiations with Vale to acquire the Jaguar Project.

Mr Gordon was formerly Chief Financial Officer for Gindalbie Metals Limited (1999-2008).

Mr Bruno R Scarpelli, M.Sc., PMP

Executive Director, Age 45

Executive Director appointed 3 September 2015. Mr Scarpelli is an engineer with over 15 years’ experience in the mining sector, specifically in the environmental approvals, health and safety and human resources fields. He was formerly environmental manager for Vale’s world class S11D Iron Ore Project.

Mr Scarpelli is Administrator of Centaurus’ Brazilian subsidiaries and the Country Manager – Brazil.

Mr Mark D Hancock, B.Bus, CA, F Fin

Non-Executive Director, Age 54

Independent non-executive director appointed 23 September 2011. Mr Hancock is a Company Director and consultant to the resource industry with a focus on commercial advisory and commodity marketing. He has over 30 years’ experience in senior commercial and financial roles across a number of leading companies in Australia and South East Asia, including most recently spending 13 years with Atlas Iron as CFO and CCO and prior to that with oil and gas industry participants Woodside Petroleum Ltd and Premier Oil Plc.

CENTAURUS METALS LIMITED ANNUAL REPORT 31

CENTAURUS METALS ANNUAL REPORT 2022

During the last three years Mr Hancock has held directorships in the following ASX listed companies:

Cyclone Metals Ltd (formerly Cape Lambert Resources Ltd, appointed 11 February 2020; resigned 4 August 2020) Non- Executive Director
CuFe Ltd (Appointed 1 September 2019) Executive Director, part time basis
Strandline Resources Ltd (Appointed 11 August 2020) Non-Executive Director

Mr Hancock is Chair of the Audit & Risk Committee

Mr Chris A Banasik, B.App.Sc (Physics), M.Sc (Geology), Dip Ed, GAICD

Non-Executive Director, Age 61

Independent non-executive director appointed 28 February 2019. Mr Banasik is a geologist with more than 30 years’ experience across multiple disciplines and commodities. He was a founding Director of WA gold producer Silver Lake Resources (ASX: SLR). He has held a range of senior geological and executive roles for companies including Consolidated Minerals, Reliance Nickel and Western Mining Corporation. He has extensive experience in nickel exploration, project development and operations, having held several geological and management positions with WMC (1986-2001).

During the last three years Mr Banasik has not held directorships in any other ASX listed companies.

Mr Banasik is the Chair of the Remuneration Committee

Dr Natalia Streltsova, MSc, PhD (Chem Eng), GAICD

Non-Executive Director, Age 61

Independent non-executive director appointed 15[th] August 2022. Dr Streltsova is a Chemical Engineer with both an MSc and PhD. She was Program Leader – Hydrometallurgy and Project Manager for WMC Resources between 2000 and 2005, working on a range of projects including Mt Keith and Olympic Dam; Team Leader – Hydrometallurgy and Technology Development Manager for BHP Billiton between 2005 and 2008; Manager Development and Technical Solutions for GRD Minproc (2008) and Director, Technical Development, for Vale SA in Brazil between 2008 and 2012.

During the last three years Dr Streltsova has held directorships in the following ASX listed companies:

Australian Potash Limited (Appointed December 2021) Non-Executive Chair
Neometals Limited (Appointed April 2016) Non-Executive Director
Ramelius Resources Limited, (Appointed October 2019) Non-Executive Director, Chair of the Risk & Sustainability Committee
Western Areas Limited (January 2017 until its takeover by IGO on 20 June 2022) Non-Executive Director

Dr Streltsova is Chair of the Technical Committee which was formed after the end of the reporting period.

Mr Johannes W Westdorp, B.Bus, CPA, MAICD, GradDip App Sc

Chief Financial Officer & Company Secretary, Age 59

Mr Westdorp was appointed as Chief Financial Officer on 11 November 2019 and Company Secretary on 15 January 2020. Mr Westdorp is a Certified Practicing Accountant. He was previously Chief Financial Officer and Company Secretary of Centaurus between 2012 and 2015. He has over 30 years’ experience in the resources sector and has held the roles of Chief Financial Officer and Interim Chief Executive Officer of mineral sands producer, MZI Resources Ltd and senior roles with Murchison Metals Ltd and Burrup Fertilisers Pty Ltd. He has financial, commercial and operations experience across a number of commodities including iron ore, gold, base metals and mineral sands.

32 ANNUAL REPORT CENTAURUS METALS LIMITED

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3 Director & Committee Meetings

The number of meetings of the Company’s Board of Directors and its Committees held during the year ended 31 December 2022 and the number of meetings attended by each director are shown in the table below.

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Board Audit & Risk Committee Remuneration Committee
Director Held [1] Attended Held [1] Attended Held [1] Attended
Mr D M Murcia 6 6 2 2 4 4
Mr D P Gordon 6 6 n/a n/a n/a n/a
Mr B R Scarpelli 6 6 n/a n/a n/a n/a
Mr M D Hancock 6 6 2 2 4 4
Mr C A Banasik 6 6 2 2 4 4
Dr N Streltsova 4 4 n/a n/a n/a n/a
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(1) Denotes the number of meetings held during the time the director held office (excluding circular resolutions)

The Company does not have a formal Nomination Committee. The function is performed by the full Board. There is no additional remuneration for committee members.

4 Operating and Financial Review

A summary of consolidated results is set out below

	31 December 2022 31 December 2021
	$ $
Interest Income R&D Tax refund Other income Loss before income tax Loss attributable to members of Centaurus Metals Limited	1,348,066 235,207 517,875 265,862 6,256 -
	1,872,197 501,069 (42,627,555) (16,994,715)
	(42,627,555) (16,994,715)

4.1 Financial Performance

During the year ended 31 December 2022 the Group expensed Exploration and Evaluation costs totaling $36,225,206 (2021: $13,198,599) in accordance with the Group’s accounting policy. The Exploration and Evaluation costs primarily comprise costs in relation to exploration and feasibility study costs at the Jaguar Nickel Sulphide Project in Brazil.

4.2 Financial Position

At the end of the year the Group had a cash balance of $34,047,722 (2021: $8,259,389) and net assets of $49,328,699 (2021: $16,750,646). Total liabilities amounted to $8,065,982 (2021: $10,099,118) and consisted of trade and other payables, financial liabilities, lease liabilities and employee benefits.

4.3 Overview

Centaurus is an ASX listed company focused on the near term development of the Jaguar Nickel Sulphide Project, located in the world-class Carajás Mineral Province of northern Brazil. The Carajás Mineral Province is one of the world's premier mining addresses, hosting one of the world's largest concentrations of large-tonnage mineral deposits. Centaurus’ goal is to become a new-generation nickel sulphide mining company in Brazil, capable of delivering more than 20,000t per annum of Class-1 nickel to global markets over the long term, and to do so in a sustainable and responsible manner that ensures the Company meets the highest possible ESG (Environmental, Social and Governance) standards. The Jaguar Project has nickel resources of 108.0 Mt @ 0.87% Nickel (Ni) for 938,500t[1] of contained nickel.

Centaurus’ key focus throughout the 2022 calendar year was on the continued development of the Jaguar Project. The Definitive Feasibility Study (DFS) for the Project was advanced during the period. An updated Mineral Resources Estimate (MRE) for the Jaguar Project was released in November 2022, cementing the Project’s position as a Tier-1 global nickel sulphide development project with class-leading greenhouse gas (GHG) emission credentials

1 Refer ASX Release of 10 November 2022. The Company confirms that it is not aware of any new information or data that materially affects the information ncluded in the original market announcements and, in the case of estimates of Mineral Resources, that all material assumptions and technical parameters underpinning the estimates in the original market announcement continue to apply and have not materially changed. The Company confirms that the form and context in which the competent persons findings were presented have not been materially modified from the original announcement.

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CENTAURUS METALS ANNUAL REPORT 2022

Activity was underpinned by a strongly supported institutional capital raise of $75m, before costs, which was completed in February 2022.

4.4 Jaguar Nickel Sulphide Project

The Jaguar Project was acquired from global mining giant, Vale S.A. (Vale) in August 2019. The Project hosts multiple nickel sulphide deposits and exploration targets within a 30km[2] land package in the western portion of the world-class Carajás Mineral Province. Jaguar is ideally located close to existing infrastructure, just 35km north of the regional centre of Tucumã (population +35,000) with access to hydroelectrical grid power (230kV sub-station) 15km south-east of the project at Vale’s Onca Puma ferronickel operations see image below.

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ANNUAL REPORT CENTAURUS METALS LIMITED

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Drilling & Exploration Programs

The focus of drilling during the first half of the year was on resource development at all the Jaguar Deposits. Extensive infill drilling was undertaken, designed to upgrade all Resources within a constrained US$22,000/t nickel price pit shell limit into the higher confidence Measured and Indicated categories.

RC drill rigs completed sterilization programs over the Jaguar processing plant area and proposed mine infrastructure areas (tailings dam sites, waste deposit, etc).

Mineral Resource Estimate

Following the extensive in-fill drilling campaign Centaurus updated its Mineral Resource Estimate (MRE) for the Jaguar Project to 108 Mt @ 0.87% Ni for 938,500 of contained nickel, confirming Jaguar as one of the largest nickel sulphide resources held by an ASX listed company and the largest outside of the majors. The success of the in-fill resource development project during the year resulted in a 100% increase in the Measured and Indicated component of the MRE to 85.8 Mt @ 0.85% Ni for 730,300t of contained nickel, representing more than 75% of the Global MRE. Measured and Indicated Resources will be available for conversion to Ore Reserves as part of the Definitive Feasibility Study (DFS).

The November 2022 MRE represented an increase of 28% since the December 2021 MRE and more than 80% since the Company’s maiden MRE in June 2020, adding 421kt of contained nickel in 30 months.

In-fill drilling targeting the first three years of operation at Jaguar Central and Onça Preta has returned a Measured Resource estimate of 14.0 Mt @ 1.06% Ni for 149,400t of contained nickel metal. The high-grade and higher confidence resources will be an important part of the early mine plan during the project pay-back period.

Project Development

Significant activity was progressed on the DFS. Industry-leading engineering firm Ausenco was appointed as Lead Engineer to deliver both the process and non-process plant infrastructure components of the study. Ausenco possesses strong experience in the processing methods planned for the Jaguar Project as well as experience in project studies and construction in South America through its offices in Belo Horizonte (Brazil), Santiago (Chile) and Lima (Peru). Ausenco has assembled a study team with both strong technical skills and detailed local knowledge of construction in Brazil, and importantly, the Carajás mineral province.

Flotation & Pilot Plant Testwork

A significant amount of flotation test work has been completed for the design of the flotation part of the overall process flowsheet design. Extensive flotation testwork has been completed on the Jaguar nickel sulphide ore, allowing the Company to prepare over 800kg of concentrate for pilot plant testing of the planned pressure oxidation circuit.

Considerable work was completed to finalise the process flowsheet to enable the POX pilot plant program to commence in January 2023. The pilot plant testwork will be carried out by ALS Limited (ALS) in four phases. The first phase will test the pressure oxidation, primary neutralization and copper recovery to solution and will be conducted over a two-week period. This will be followed by the Phase 2 which is designed to extract zinc (for a by-product revenue stream) and soluble calcium from Phase 1 leach solution with minimal nickel loss. Phase 3 is designed to initially extract cobalt (again for a by-product revenue stream) and magnesium followed by the purification of the nickel solution to produce nickel sulphate. Nickel sulphate crystallization and zinc and cobalt hydroxide precipitate production will be piloted in Phase 4.

The pilot testwork will culminate with the delivery of nickel sulphate and other final products for product marketing, as well as assisting in providing the design criteria for Ausenco to use in the development of the overall process flowsheet for the DFS.

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Mining

Pricing proposals were received from mining contractors to support the development of the DFS opex, open pit optimisations and mine planning work. These proposals are under commercial and technical evaluation to select pricing for use in open pit planning for the DFS, utilising the most recent MRE orebody model.

Process Plant Engineering

The concentrator section of the processing facility, consisting of crushing, grinding and flotation and thickening circuits, was finalised for the study and capital equipment packages were progressively issued for pricing. Pricing for the major equipment was received from suppliers during the December quarter, with the commercial and technical evaluation process well advanced.

The process design and layout of the refinery circuit and non-process plant infrastructure (NPI) commenced.

Environmental Approvals

The environmental approval process is progressing without issue, albeit at a slightly slower pace than the Company was anticipating. Several meetings, including an initial site visit, have been held with the Environmental Agency in Para State (SEMAS) to keep them informed on project development activities.

Off-take Discussions

Off-take discussions are continuing in relation to the products to be produced from Jaguar. Vale has the right to purchase product at arm’s length market-based pricing under the original acquisition agreement for the Jaguar Project. Centaurus retains discretion over what nickel products will be produced at Jaguar.

The introduction of the Inflation Reduction Act by the US Government and the Critical Raw Materials Act of the European Union has highlighted the strategic importance of energy metals like nickel and those that can be sourced in geopolitically stable jurisdictions with a low-emission footprint. Brazil fits these criteria well as it is South America’s largest pro-mining jurisdiction, the 8[th] largest global economy and currently more than 80% of the country’s grid power is delivered from renewable sources. It is anticipated that the Jaguar Project will be able to secure 100% renewably sourced power by the time it is in production.

With its very large metal endowment, the Jaguar Project is extremely well placed to capitalise on the fast-growing electric vehicle and battery metals market.

New Core Shed

The Company completed the construction of the new site core shed on site at Jaguar with a capacity to store 300,000m of core. Shelving has been installed and all core from the existing core shed in Tucumã has now been relocated to the new facility on site. The shed will also house new core as drilling on site progresses.

4.5 Carajas Generative Projects

The Company is negotiating or has completed landowner access agreements and started early-stage exploration including mapping and soil sampling on a number of new targets in the Carajas region. Geophysical surveys will be planned once exploration targets have been determined.

Santa Inês Project

The Santa Inês Project is located 15km[2] northwest of the Jaguar Project (Figure 1). The recently granted 18 km[2] exploration lease is positioned on a strand of the regionally significant Canaã Fault which is the same structure that is understood to have been critical in the mineralisation processes of the Jaguar Deposit.

Terra Roxa Project

The Terra Roxa Project is a recently granted 29km[2] exploration lease located 30km southwest of the Jaguar Project (Figure 1). The project is located on the McCandless Fault which traverses the Jaguar Project through the Puma Layered MaficUltramafic Complex and is understood to be the source of nickel for the hydrothermal mineralisation seen at Jaguar. Terra Roxa is located immediately south of Vale’s Mundial nickel-laterite deposit which is the laterite cap of another mafic-ultramafic intrusion.

36 ANNUAL REPORT CENTAURUS METALS LIMITED

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Curionópolis Project

The Curionópolis Project is a group of four recently granted exploration leases covering 51km[2] located 15km east of Oz Minerals Antas Norte Cu-Au operation (Figure 1) in the Eastern Carajás. The tenements cover more than 15km of strike of the highly prospective Itacaiúnas Supergroup (which hosts all IOCG deposits within the Carajás Mineral Province) coincident with a strong continuous aeromagnetic anomaly.

4.6 Jambreiro Iron Ore Project

The Company has commenced the process to refresh all environmental licenses required to develop the project. As part of this process, Supram (the Minas Gerais environmental agency) has advised that new wet and dry season environmental data will need to be collected to support a new Installation License (LI) application given the age of the data used in the originally approved LI. The new data is expected to be collected over the next 3-4 months, with the new application targeted for lodgment in July 2023. Approval is anticipated to be 12 months from lodgment.

The Company has also lodged the documentation to re-apply for all water permits necessary to operate the project. All water permits and environmental licences to build the Project were previously granted and are therefore expected to be granted after the applications have been duly considered by the relevant agencies.

The Company continues to assess opportunities to realise value from the Jambreiro Iron Ore Project and carried out several activities focused on this goal during the year. Realising value from the project remains contingent on the completion of off-take or partnering arrangements and discussions remain open in this regard.

4.7 Health & Safety

One Lost Time Injury occurred during the year resulting in an LTIFR 12-month moving average of 4.89. The average LTI Frequency Rate for the West Australian Exploration Industry for the 2020/21 Period was 2. One medical treatment injury occurred during the year.

The Total Recordable Injury Frequency Rate for the Group’s operations in Brazil was 9.78, a good improvement compared to the prior year result of 12.50.

4.8 ESG Program

The Company adopted its formal environmental, social and governance (ESG) policy framework late in 2021. The framework is based on the recommendations and principles of two key ESG authorities, being:

Towards Sustainable Mining Principles (TSM); and
Principles of Responsible Investment (PRI)

TSM is the Mining Association of Canada’s (MAC) commitment to responsible mining. It is a set of tools and indicators to drive performance and ensure that key mining risks at any operation are managed responsibly. The PRI defines responsible investment as a strategy and practice to incorporate environmental, social and governance factors in investment decisions and active ownership. The PRI is a global organisation that encourages and supports the uptake of responsible investment practices in the investment industry.

All Centaurus employees working on the Jaguar Project live in the local town with their families, solidifying the relationship between the Company and the local community.
More than 90% of the current project workforce, including employees and outsourced labour, are from the south-eastern region of the State of Pará.
More than 90% of the Company’s investment expenditure relating to exploration and development work at the jaguar Project to date has been awarded to the local community through drilling contracts, engagement of consultants and services and purchase of equipment and supplies.
During the collection of social data, more than 95% of the local community interviewed were in favour of the project.
Construction and operation of a plant nursery on site with a capacity of 10,000 seedlings to support revegetation.

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GHG Emissions

Since January 2022, the Company has been monitoring Scope 2 greenhouse gas (GHG) emissions and sinks associated with the Jaguar Project. The main carbon sink is the standing forest. The main source of carbon from the Project at present is the combustion of diesel to run drill rigs.

The Jaguar Project currently represents a carbon sink, removing about 12,000t of GHG annually from the atmosphere, which is equivalent to removing approximately 2,570 internal combustion engine vehicles (4.6t GHG per vehicle per year) from the roads each year.

Based on the work completed with Skarn Associates previously, the Jaguar Project is expected to have GHG emissions that are less than 97% of global nickel production once in operation.

Water Wells

Bore hole pumping tests on five bores drilled to assess the quantity and quality of groundwater inflows to the open pit operations have indicated that low flow rates are to be expected, which is very positive for the overall project development. Hydrogeological modelling of the pump test results commenced in December to quantify the flows and aquifer characteristics. This modelling will be completed in January.

Plant Nursery

The Company established a plant nursery on site to facilitate the revegetation of previously cleared farmland. The planned revegetation will allow new forest corridors to be established around the site to assist with the movement, protection and biodiversity of fauna.

Community Consultation

In December, presentations about the Jaguar Project were made to the mayors and councilors of the three municipalities in the region. These presentations were designed to prepare the local authorities for the official public hearings planned to be held as part of the environmental approvals process. The same presentations will be made to the broader community in all three municipalities in January 2023.

Construction Training Programs

During the year, the Company further advanced the enrolment process for construction training with over 1,900 applications to date having been received from local communities. The Company intends to train up to 1,500 people in various trades that will allow them to be able to seek employment once construction of the Jaguar Project commences. The training programs are intended to be conducted in conjunction with local industry training college (SENAI) in 2023 and 2024.

4.9 Corporate

The Company completed an institutional share placement in January 2022 which raised $75m to fund the growth and development of the Jaguar Project including progressing the DFS for Jaguar and continuing the significant drilling program for the Project. Funds are being used for pre-development and financing activities ahead of a planned final investment decision (FID) on the Project.

During the period, the Jaguar Project was selected as a Strategic Minerals Project by the Brazilian Federal Government. The Strategic Minerals Policy is part of the Investment Partnership Program – PPI (Programa de Parcerias de Investimento), a new Brazil governmental initiative designed to support companies while developing their projects across the country. The PPI program supports projects that are identified as strategic minerals projects in Brazil and provides the titleholder with specialised governmental support for the development of their projects.

The Company made a number of key appointments to its Board and senior leadership team during the year as it continued to build its in-house technical, commercial, legal and operational expertise to progress the Jaguar Project towards financing, development and operations. In August 2022 former Vale, WMC and BHP executive, Dr Natalia Streltsova was appointed as a Non-Executive Director. Dr Streltsova’s significant experience in nickel processing has enhanced Board capability in a key area for the business.

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The Company made two key appointments to its senior leadership team during the year as it continued to build its inhouse technical, commercial, legal and operational expertise to progress the Jaguar Project towards financing, development and operations. Mr Fabio Borges was appointed in February as Finance Manager Brazil and is a certified accountant with significant experience in mining. Mr Borges is based in the Company’s Belo Horizonte office. Mr Mick Ryan was appointed in November as Project Manager to assist with delivering the Jaguar DFS. Mr Ryan is a metallurgist with considerable experience in studies, project and construction management and operations including in nickel processing and hydrometallurgy.

4.10 Factors and Business Risks Affecting Future Business Performance

The current and future activities of the Company are influenced by numerous factors, many of which are impacted by events external to the control of the Company. The following factors and business risks could have a material impact on the Company’s success in delivering its strategy:

Access to Funding

The Company’s ability to further develop the Jaguar Nickel Sulphide Project and successfully develop future projects is contingent on the ability to fund those projects from operating cash flows or through affordable debt and equity raisings. Ongoing exploration of the Company’s projects is contingent on developing appropriate funding solutions.

Commodity Prices

Commodity prices fluctuate according to changes in demand and supply. The Company is exposed to changes in the price of a number of commodities, which could affect the future profitability of the Company’s projects. Significant adverse movements in commodity prices could also affect the ability to raise debt and equity to fund future exploration and development of projects.

Exchange Rates

The Company is exposed to changes in the US Dollar and the Brazilian Real. Sales of most commodities are denominated in US Dollars. The Company’s capital and operating costs will be primarily denominated in Brazilian Real.

COVID-19

Disruptions as a result of the requirement to isolate infected or close contact employees has had an impact on some of the Company’s service providers, with laboratories particularly experiencing delays in sample assay turnaround times. These impacts have exposed the Company to delays in the delivery of study programs.

5 Significant Changes in the State of Affairs

In the opinion of directors, other than as outlined in this report, there were no significant changes in the state of affairs of the Group that occurred during the financial year under review.

6 Principal Activities

During the period the principal activities of the Group consisted of exploration and evaluation activities related to mineral resources in Brazil. There were no significant changes in the nature of the activities of the Group during the year.

7 Events Subsequent to Reporting Date

There has not arisen, in the interval between the end of the financial year and the date of this report an item, transaction or event of a material and unusual nature likely, in the opinion of the directors of the Company, to affect significantly the operations of the Group, the results of those operations, or the state of affairs of the Group, in future financial years.

8 Likely Developments

Other than likely developments contained in the “Operating and Financial Review” and “Events Subsequent to Reporting Date”, further information on likely developments in the operations of the Group and the expected results of operations have not been included in this report because the directors believe it would be likely to result in unreasonable prejudice to the Group.

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9 Environmental Regulation

The Group is subject to environmental laws and regulations under Brazilian (State and Federal) legislation depending on the activities undertaken. Compliance with these laws and regulations is regarded as a minimum standard for the Group to achieve. There were no known breaches of these regulations during the year.

10 Dividends

No dividend was declared or paid by the Company during the current or previous year.

11 Directors’ Interests

The relevant interest of each director in the shares and options over such shares issued by the companies within the Group and other related bodies corporate, as notified by the directors to the ASX in accordance with S205G (1) of the Corporations Act 2001, at the date of this report is as follows:

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Ordinary Shares Options
Directors
Mr D M Murcia 1,771,967 1,200,000
Mr D P Gordon 6,335,546 2,599,631
Mr B R Scarpelli 1,166,667 1,029,790
Mr M D Hancock 1,112,254 800,000
Mr C A Banasik 950,001 1,150,001
Dr N Streltsova 85,000 -
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12 Share Options

At the date of this report unissued ordinary shares of the Company under unlisted option are:

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Options Total Number of
Shares Under
Expiry Date Exercise Price Vested Unvested Option
31/05/2023 $0.180 116,667 - 116,667
31/05/2023 $0.392 1,400,000 - 1,400,000
31/05/2023 - 3,952,402 - 3,952,402
31/05/2024 $0.180 233,334 - 233,334
31/05/2024 $0.405 - 1,400,000 1,400,000
31/12/2024 - 1,395,452 - 1,395,452
31/12/2025 - - 1,225,220 1,225,220
31/12/2026 - - 846,389 846,389
7,097,855 3,417,609 10,569,464
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13 Indemnification and Insurance of Officers and Auditors

During the period, the Company paid insurance premiums to insure the directors and executive officers of the Group. The amount of premiums paid has not been disclosed due to confidentiality requirements under the contract of insurance.

The liabilities insured are legal costs that may be incurred in defending civil or criminal proceedings that may be brought against directors and employees in their capacity as officers of entities in the Group, and any other payments arising from liabilities incurred by them in connection with such proceedings, other than where such liabilities arise out of conduct involving a willful breach of duty by the officers or the improper use by them of their position or of information to gain advantage for themselves or someone else or to cause detriment to the Group.

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14 Non-Audit Services

During the period KPMG, the Company’s auditor, has performed certain other services in addition to their statutory duties.

The Board has considered the non-audit services provided during the year by the auditor and in accordance with written advice provided by resolution of the Board, is satisfied that the provision of those non-audit services during the year by the auditor did not compromise the auditor independence requirements of the Corporations Act 2001 for the following reasons:

all non-audit services were subject to the corporate governance procedures adopted by the Company and have been reviewed by the Board to ensure they do not impact the integrity and objectivity of the auditor; and
the non-audit services provided do not undermine the general principles relating to auditor independence as set out in APES 110 Code of Ethics for Professional Accountants, as they did not involve reviewing or auditing the auditor’s own work, acting in a management or decision-making capacity for the Company, acting as an advocate for the Company or jointly sharing risks and rewards.

Details of the amounts paid to the auditor of the Company, KPMG, and its related practices for audit and non-audit services provided during the year are set out below.

	31 December 2022 $ 31 December 2021 $
Audit services Auditors of the Company Audit and review of financial reports Services other than statutory audit Taxation compliance services Other consulting services
	60,000 58,861
	7,576 6,986 10,590 -
	18,166 6,986

15 Auditor’s Independence Declaration

The auditor’s independence declaration is set out at page 52 and forms part of the directors’ report for the period ended 31 December 2022.

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16 Remuneration Report – Audited

16.1 Principles of Remuneration

The primary objective of the Group’s executive reward framework is to ensure reward for performance is competitive and appropriate for the results delivered. The framework aligns executive reward with achievement of strategic objectives and the creation of value for shareholders.

The Company’s Remuneration Committee is a sub-committee of the Board. Specialist remuneration advisors are engaged by and report directly to the Remuneration Committee. In selecting remuneration advisors the Remuneration Committee considers any potential conflicts of interest and ensures independence from KMP. During the period, the Remuneration Committee sought advice from external remuneration advisors in relation to remuneration benchmarking for Executive KMP and Non-Executive Directors.

During the period, the resources industry experienced significant pressure in relation to remuneration of professionals and the independent reports received from the remuneration advisors indicated that increases in remuneration were warranted in order to maintain market competitiveness for both Non-Executive Directors and KMP. The work undertaken by the remuneration advisors did not involve providing the Remuneration Committee with any remuneration recommendations as defined by the Corporations Act 2001 .

The Board considers the recommendations of the Remuneration Committee in ensuring that executive reward satisfies the following key criteria:

competitiveness and reasonableness;
acceptability to shareholders;
performance linked executive compensation;
transparency; and
capital management.

The Group has structured an executive remuneration framework that is market competitive and consistent with the reward strategy of the organisation. The Board seeks to align shareholder and participant interests by ensuring the Company’s remuneration framework applies the following principles;

focuses on the creation of shareholder value and returns;
attracts and retains high calibre executives with an inherent knowledge of the Company’s ongoing business and activities;
rewards capability and experience;
reflects competitive reward for contribution to growth in shareholder wealth;
provides a clear structure for earning rewards;
provides recognition for contribution; and
seeks to retain experienced and competent individuals in key executive roles.

The remuneration framework consists of base salary, superannuation and short and long-term incentives. Whilst intended to be settled in cash, the Board retains the discretion to settle short term incentives with equity. An Employee Share Incentive Plan (ESIP) was approved by shareholders at the AGM in May 2022 and incentives settled in equity may be offered under this plan. The ESIP replaces the Employee Share Option Plan (ESOP) which was approved by shareholders at the 2019 AGM.

The overall level of executive reward takes into account the performance of the Group over a number of years, with greater emphasis given to the current and prior year. Over the past 5 years, the Group was involved in mineral exploration and pre-development activities and therefore growth in earnings is not considered a relevant measure. Shareholder wealth is currently primarily dependent upon exploration and development success in addition to being influenced by broader market factors.

The performance of the Group in respect of the current period and the previous four financial years is set out below:

	2022 $	2021 $	2020 $	2019 $	2018 $
Net Loss	(42,627,555)	(16,994,715)	(11,468,825)	(4,275,397)	(4,197,361)
Change in shareprice(1)	$0.010	$0.290	$0.625	$0.090	$0.000
Change in shareprice	1%	35%	321%	86%	-

(1) In April 2020 the Company completed a 15-for-1 share consolidation, comparatives have been restated.

42 ANNUAL REPORT CENTAURUS METALS LIMITED

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16.2 Remuneration Framework

The executive remuneration and reward framework currently has four components:

base salary;
short term incentives (STIs);
long term incentives (LTIs); and
other remuneration such as superannuation and insurances.

The combination of these components comprises the executive’s total remuneration.

16.2.1 Base Salary

Executives are offered a competitive base salary that is reflective of current market conditions. Base salary for senior executives is reviewed annually to ensure the executive’s remuneration is competitive with the market. An executive’s base salary is also reviewed on promotion. There are no guaranteed base salary increases included in any senior executive contracts.

16.2.2 Short Term Incentives

The Short Term Incentive (STI) Plan is designed to reward executives for the achievement of annual performance targets. The STI Plan and the annual performance objectives under the STI Plan are reviewed annually by the Remuneration Committee and approved by the Board. All awards to Key Management Personnel (KMP) are assessed and recommended by the Remuneration Committee and approved by the Board.

For 2022, KMP other than the Managing Director, can earn up to 35% of Total Fixed Remuneration (TFR) under the STI Plan whilst the Managing Director can earn up to 50% of TFR. Other Managers of the Group can earn up to 15-25% of TFR under the Plan.

The annual performance targets are based on challenging goals with a mix of both Company performance and project specific targets. Given its status as a pre-revenue exploration entity focused on the development of its key projects, the Company does not consider that financial targets such as net profit are relevant measures for a STI program. The Group’s key STI performance measures for the year ending 31 December 2022 are summarised below;

effective management of environmental conditions and safety performance;
community and land owner engagement in Brazil;
achievement of defined targets for the Jaguar Project with respect to exploration activity performance and mineral Resource definition;
achievement of a number of capital projects;
achievement of a number of key deliverables in relation to the licensing, definitive feasibility study, offtake and other development activities of the Jaguar Nickel Project;
achievement of value adding outcome for the Jambreiro Iron Ore project; and
market capitalisation growth targets.

Details of STI incentives awarded during the year are provided in Section 16.6.4.

16.2.3 Long Term Incentives

LTIs may be granted from time to time to reward performance in the realisation of strategic outcomes and long-term growth in shareholder wealth. Options or performance rights may be utilised to deliver long term incentive awards. The Board has discretion to grant options or performance rights for no consideration. Options or performance rights do not carry voting or dividend entitlements. Information on share options granted during the year is set out in Section 16.6.

During the period, KMP were granted options with no exercise price which are subject to vesting conditions related to achieving performance targets measured over a three-year period. The options were issued under the Company’s ESIP and under ASX Listing Rule 10.11 for Executive Directors. KMP, other than the Managing Director, were issued with options up to the value of 50% of TFR whilst the Managing Director was issued with options up to the value of 100% of TFR.

Whilst the ESIP is approved by shareholders for a 3 year period, vesting conditions are set by the Board on an annual basis in order to ensure responsiveness to changes in business circumstances.

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The 3 year Assessment Period for the 2 tranches of options issued under the LTIP in 2020 closed at the end of the reporting period being 31 December 2022. The vesting condition for tranche 1 was based on Total Shareholder Return relative to a peer group of companies determined by the Board and disclosed in the 2020 Annual Report while the vesting condition for tranche 2 was expressed as entry into the ASX 300 index, which at the time was expressed to the recipients as achieving a market capitalisation of at least $200 million.

During the reporting period, the exercise condition for tranche 2 was clarified by the Board to reflect the underlying intention at the time of issue of the incentives that the Company achieve a market capitalisation of at least $200 million and with this market capitalisation, the Company would be in the 300 largest companies with a primary listing of ordinary shares on the ASX by market capitalisation. All other terms and conditions of the grant remained the same and there was no increase in the value of the award.

The market capitalisation of the Company at the commencement of the Assessment Period on 1 January 2020 was $45.5m and increased to $478.4m as at 31 December 2022, representing an increase of $433.9m or 952% and placing the Company in the 300 largest companies with a primary listing of ordinary shares on the ASX by market capitalisation.

Following the close of the Assessment Period, the Board determined that the vesting conditions on the tranche 1 & 2 options had been met and as such the options vested with the KMP and are capable of being exercised.

The terms and conditions of the zero exercise priced options affecting remuneration during the reporting period are set out below.

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Performance Value per
Measurement Option at
Grant Date period Expiry Date Vesting Conditions grant date
Executive Directors
23 March 2022 1 January 2022 to 31 31 December 2025 50% of Options vest based on Total Shareholder Return relative $1.1485
December 2024 to a peer group of companies determined by the Board
23 March 2022 1 January 2022 to 31 31 December 2025 50% based upon Absolute Total Shareholder Return. $1.0496
December 2024
19 February 2021 1 January 2021 to 31 31 December 2024 50% of Options vest based on Total Shareholder Return relative $0.7833
December 2023 to a peer group of companies determined by the Board.
19 February 2021 1 January 2021 to 31 31 December 2024 50% based upon Absolute Total Shareholder Return. $0.6756
December 2023
29 May 2020 1 January 2020 to 31 31 December 2023 50% of Options vest based on Total Shareholder Return relative $0.2482
December 2022 to a peer group of companies determined by the Board.
29 May 2020 1 January 2020 to 31 31 December 2023 50% based on achieving a market capitalisation at the close of $0.2013
December 2022 the Assessment Period that was greater than $200 million and
which places and the Company in the 300 largest companies
with a primary listing of ordinary shares on the ASX by market
capitalisation.
Executives
23 March 2022 1 January 2022 to 31 31 December 2025 50% of Options vest based on Total Shareholder Return relative $1.1485
December 2024 to a peer group of companies determined by the Board
23 March 2022 1 January 2022 to 31 31 December 2025 50% based upon Absolute Total Shareholder Return. $1.0496
December 2024
13 July 2021 1 January 2021 to 31 31 December 2024 50% of Options vest based on Total Shareholder Return relative $0.6900
December 2023 to a peer group of companies determined by the Board.
13 July 2021 1 January 2021 to 31 31 December 2024 50% based upon Absolute Total Shareholder Return. $0.5774
December 2023
25 January 2021 1 January 2021 to 31 31 December 2024 50% of Options vest based on Total Shareholder Return relative $0.7188
December 2023 to a peer group of companies determined by the Board.
25 January 2021 1 January 2021 to 31 31 December 2024 50% based upon Absolute Total Shareholder Return. $0.6212
December 2023
14 February 2020 1 January 2020 to 31 31 December 2023 50% of Options vest based on Total Shareholder Return relative $0.1582
December 2022 to a peer group of companies determined by the Board.
14 February 2020 1 January 2020 to 31 31 December 2023 50% based on achieving a market capitalisation at the close of $0.1174
December 2022 the Assessment Period that was greater than $200 million and
which places and the Company in the 300 largest companies
with a primary listing of ordinary shares on the ASX by market
capitalisation.
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Each milestone will be assessed at the end of the 3-year assessment period and the options will not vest or be capable of being exercised until after this assessment period has closed, other than in the case of a successful change of control transaction in which case the options will immediately vest.

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The Board considers that this feature of the LTIP provides an appropriate level of protection for KMP and is in alignment with the interests of shareholders who are likely to benefit from a change in control transaction. Participants in the LTI plan must remain in employment during the assessment period.

To achieve the relative Total Shareholder Return (TSR) performance measure, the Company must outperform, on a TSR basis, at least 49.9% of the peer group established by the Board. The peer group for the LTI granted during the year ended 31 December 2022 is comprised of the following companies.

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Adriatic Metals PLC Lake Resources NL Rumble Resources Limited
Blackstone Minerals Limited Legend Mining Limited Sovereign Metals Limited
Core Lithium Ltd Mincor Resources NL Stavely Minerals Limited
Emerald Resources NL New Century Resources Limited Syrah Resources Limited
Energy Transition Minerals Limited OreCorp Limited Talga Group Ltd
Galan Lithium Limited Panoramic Resources Limited Tietto Minerals Limited
Jervois Global Limited Poseidon Nickel Limited Develop Global Limited
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The assessment of the relative TSR performance measure will be made at the end of the assessment period with vesting to occur in accordance with the table below.

Percentile Ranking compared to Peers	Amount of ZEPO to Vest
<50thPercentile	Zero
B/t 50thand 75thPercentile	Pro Rata B/t 50% and 100%
>75th percentile	100%

TSR is defined as the financial gain that results from a change in the Company’s share price plus any dividends paid by the Company during the assessment period divided by the share price at the start of the assessment period.

The achievement of the absolute TSR performance measure will be made at the end of the assessment period, with vesting to occur in accordance with the table below.

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Threshold TSR Level over Amount of ZEPOs which will vest
Assessment Period and become exercisable
Less than 30% Zero
B/t 30% and 40% 50%
B/t 40% and 50% 75%
50% or greater 100%
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Vested options can be exercised any time between vesting and the expiry date.

16.2.4 Superannuation

In accordance with regulatory requirements, Directors and employees are permitted to nominate a superannuation fund of their choice to receive superannuation contributions.

16.3 Employment Agreements

Remuneration and other terms of employment for executives are formalised in employment agreements which are reviewed annually. The agreements provide for the provision of other benefits and participation, at the discretion of the Board in short and long-term incentive plans (refer to sections 16.2.2 and 16.2.3).

Other major provisions of the current employment agreements, as at the date of this report, relating to remuneration are set out below:

CENTAURUS METALS LIMITED ANNUAL REPORT

CENTAURUS METALS ANNUAL REPORT 2022

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Salary Incl of Maximum STI Maximum LTI Notice Period Notice Period
Name Superannuation Potential Potential Company Employee Redundancy
D P Gordon $533,000 pa 50% 100% 12 months 6 months 12 months
W E Foote $425,000 pa 40% 60% 3 months 3 months 6 months
J W Westdorp $390,000 pa 40% 60% 6 months 2 months 6 months
B R Scarpelli $372,000 pa 45% 70% 2 months 2 months 6 months
R J Fitzhardinge $273,600 pa 40% 60% 2 months 2 months 6 months
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16.4 Non-Executive Directors

Fees and payments to Non-Executive directors reflect the demands which are made on, and the responsibilities of, the directors. Non-Executive directors’ fees and payments are reviewed at least annually by the Board. The Chair’s fees are determined independently to the fees of Non-Executive directors based on comparative roles in the external market and prevailing market conditions. The advice of independent remuneration consultants is sought on an annual basis.

Non-Executive directors’ remuneration consists of set fee amounts. The current level of fees, applicable from 1 January 2023, for Non-Executive directors is $77,000 per annum. The Non-Executive Chair’s fees are $115,000 per annum. Directors do not receive additional committee fees. Non-Executive directors’ fees are subject to an aggregate pool limit, which is periodically recommended for approval by shareholders. The approved pool limit is currently $400,000. There is no provision for retirement allowances for Non-Executive directors.

Non-Executive Directors may be granted options from time to time to provide a meaningful additional incentive for their ongoing commitment and dedication to the continued growth of the Group and to assist the Company in attracting and retaining the highest calibre of Non-Executive Director, whilst maintaining the Group’s cash reserves. There were no options granted or issued to Non-Executive Directors in the current period, with the cost reported relating to prior period issues which are progressively vesting. Refer to Section 16.6 for options issued during prior periods. Prior to issuing incentives the Board considers whether the issue is reasonable in the circumstances.

ANNUAL REPORT CENTAURUS METALS LIMITED

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	S300A(1)(e)(vi) Value of Options as Proportion of Remuneration %		153,601 - 31.6%	173,153 - 56.7% 102,401 - 31.6% 115,235 - 56.8% 102,401 - 31.6% 119,825 - 58.4% 26,833 - - - - -		1,106,865 51.1% 36.5%	914,024 47.0% 26.3% 585,106 40.0% 26.5% 469,258 38.4% 20.9%		466,794 39.1% 28.2% 392,942 36.1% 19.8% 583,457 37.5% 25.5% 491,216 35.0% 18.2% 581,242 32.4% 19.5% 233,781 35.4% 10.1%	3,708,700 2,909,434

	S300A(1)(e)(i) Proportion of Remuneration Performance Related %
	Total $
Share Based Payments	Options(3)$		48,601	98,153 32,401 65,435 32,401 70,025 - -		403,582	240,302 155,023 98,141		131,508 77,961 148,561 89,620 113,105 23,612	1,065,182 763,249
Long Term Benefits	Long Service Leave(2)$		105,000 - - - -	75,000 - - - - 70,000 - - - - 49,800 - - - - 70,000 - - - - 49,800 - - - - 26,833 - - - - - - - - -		457,500 162,475 29,141 27,500 26,667	409,350 189,486 27,924 26,250 20,712 339,423 79,214 11,446 - - 269,835 82,215 19,067 - -		230,750 51,134 13,330 23,650 16,422 226,175 63,868 (6,367) 21,992 9,313 322,500 70,350 14,546 27,500 - 288,750 82,215 4,381 26,250 - 346,500 75,174 18,963 27,500 - 136,152 59,160 2,804 12,053 -	1,968,506 438,347 87,426 106,150 43,089 1,504,862 476,944 47,809 86,545 30,025
	Superannuation $
Post Employment Benefits

Short Term Benefits	Other Benefits(1)$
	STI Bonuses $
	Salary & Fees $
	Year		2022	2021 2022 2021 2022 2021 2022 2021		2022	2021 2022 2021		2022 2021 2022 2021 2022 2021
		Non- Executive Directors	Mr D M Murcia	Mr M D Hancock Mr C A Banasik Dr N Streltsova(4)	Executive Directors	Mr D P Gordon	Mr B R Scarpelli	Executives	Mr R J Fitzhardinge Mr J W Westdorp Mr W E Foote(5)	Total 2022 Total 2021

CENTAURUS METALS LIMITED ANNUAL REPORT

CENTAURUS METALS ANNUAL REPORT 2022

16.6 Equity Instruments

Options may be granted under the ESIP which was approved by shareholders at the 2022 Annual General Meeting. Eligibility to participate in the ESIP (including participation by Executive and Non-Executive directors) is determined by the Board in its absolute discretion. The vesting and exercise conditions of options granted are also determined by the Board in its absolute discretion. Employees must remain in employment during the vesting period. Options may also be granted by the Company outside of the ESIP, but under similar terms and conditions.

The Group has a policy that prohibits directors and employees who are granted share options as part of their remuneration from entering into arrangements that limit their exposure to losses that would result from share price decreases.

16.6.1 Analysis of Options over Equity Instruments Granted as Compensation

Details of vesting profiles of the options granted as remuneration both during the current and prior years to KMP of the Group are detailed below. There were no options forfeited during the year. A total of 3,750,002 options previously granted as compensation with a weighted average exercise price of $0.28 were exercised in 2022 raising $1,052,700.

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Number of Fair value per Financial Year
Options option at grant % Vest in in Which Grant
Issued Grant Date Expiry Date Exercise Price date Year Vests/Vested [(1)]
Directors
Mr D M Murcia 600,000 29/05/20 31/05/23 $0.392 $0.1461 100% 2022
600,000 29/05/20 31/05/24 $0.405 $0.1667 - 2023
Mr D P Gordon 841,479 29/05/20 31/12/23 $0.000 $0.2482 - 2023 [(2)]
841,479 29/05/20 31/12/23 $0.000 $0.2013 - 2023 [(3)]
235,307 19/02/21 31/12/24 $0.000 $0.7833 - 2024 [(4)]
235,307 19/02/21 31/12/24 $0.000 $0.6756 - 2024 [(5) ]
223,030 23/03/22 31/12/25 $0.000 $1.1485 - 2025 [(6) ]
223,029 23/03/22 31/12/25 $0.000 $1.0496 - 2025 [(7) ]
Mr B R Scarpelli 339,992 29/05/20 31/12/23 $0.000 $0.2482 - 2023 [(2)]
339,991 29/05/20 31/12/23 $0.000 $0.2013 - 2023 [(3)]
97,234 19/02/21 31/12/24 $0.000 $0.7833 - 2024 [(4)]
97,234 19/02/21 31/12/24 $0.000 $0.6756 - 2024 [(5)]
77,670 23/03/22 31/12/25 $0.000 $1.1485 - 2025 [(6) ]
77,669 23/03/22 31/12/25 $0.000 $1.0496 - 2025 [(7) ]
Mr M D Hancock 400,000 29/05/20 31/05/23 $0.392 $0.1461 100% 2022
400,000 29/05/20 31/05/24 $0.405 $0.1667 - 2023
Mr C A Banasik 116,667 31/05/19 31/05/23 $0.180 $0.0868 - 2020
233,334 31/05/19 31/05/24 $0.180 $0.0952 - 2021
400,000 29/05/20 31/05/22 $0.378 $0.1189 - 2021
400,000 29/05/20 31/05/23 $0.392 $0.1461 100% 2022
400,000 29/05/20 31/05/24 $0.405 $0.1667 - 2023
Dr N Streltsova - - - - - - -
Executives
Mr R J Fitzhardinge 369,741 14/02/20 31/12/23 $0.000 $0.1582 - 2023 [(2)]
369,741 14/02/20 31/12/23 $0.000 $0.1174 - 2023 [(3)]
98,675 25/01/21 31/12/24 $0.000 $0.7188 - 2024 [(4) ]
98,675 25/01/21 31/12/24 $0.000 $0.6212 - 2024 [(5)]
73,117 25/03/22 31/12/25 $0.000 $1.1485 - 2025 [(6) ]
73,117 25/03/22 31/12/25 $0.000 $1.0496 - 2025 [(7) ]
Mr J W Westdorp 424,990 14/02/20 31/12/23 $0.000 $0.1582 - 2023 [(2)]
424,989 14/02/20 31/12/23 $0.000 $0.1174 - 2023 [(3) ]
113,440 25/01/21 31/12/24 $0.000 $0.7188 - 2024 [(4)]
113,440 25/01/21 31/12/24 $0.000 $0.6212 - 2024 [(5)]
80,475 23/03/22 31/12/25 $0.000 $1.1485 - 2025 [(6) ]
80,475 23/03/22 31/12/25 $0.000 $1.0496 - 2025 [(7) ]
Mr W E Foote 97,955 13/07/21 31/12/24 $0.000 $0.6900 - 2024 [(4)]
97,955 13/07/21 31/12/24 $0.000 $0.5774 - 2024 [(5)]
85,993 23/03/22 31/12/25 $0.000 $1.1485 - 2025 [(6) ]
85,993 23/03/22 31/12/25 $0.000 $1.0496 - 2025 [(7) ]
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48 ANNUAL REPORT CENTAURUS METALS LIMITED

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(1) Options are subject to the satisfaction of service conditions. Options will vest subject to achievement of the vesting conditions which will be assessed in the year following the measurement period.
(2) Refer to section 16.2.3 for further details. Options will vest subject to achieving a market capitalisation, at the end of the assessment period, of greater than $200 million and which places the Company in the 300 largest companies with a primary listing of ordinary shares on the ASX by market capitalisation and to meeting a three-year service condition to 31 December 2022.
(3) Options will vest subject to the achievement of the relative TSR measure detailed in the 2020 Annual Report and to meeting a three year service condition to 31 December 2022.
(4) Options will vest subject to the achievement of the absolute TSR measure detailed in Section 16.2.3 and to meeting a three year service condition to 31 December 2023.
(5) Options will vest subject to the achievement of the relative TSR measure detailed in Section 16.2.3 and to meeting a three year service condition to 31 December 2023.
(6) Options will vest subject to the achievement of the absolute TSR measure detailed in Section 16.2.3 and to meeting a three year service condition to 31 December 2024.
(7) Options will vest subject to the achievement of the relative TSR measure detailed in Section 16.2.3 and to meeting a three year service condition to 31 December 2024.

16.6.2 Options Over Equity Instruments Granted as Compensation

The movement during the reporting period, by number of options over ordinary shares in Centaurus Metals Limited held, directly, indirectly and beneficially, by each KMP, including their related parties, is as follows:

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Vested and
Held 31 Vested Exercisable
Held 1 December During the 31 December
January 2022 Exercised Granted 2022 Period 2022
Directors
Mr D M Murcia 2,133,334 (933,334) - 1,200,000 - -
Mr D P Gordon 2,820,239 (666,667) 446,059 2,599,631 - -
Mr B R Scarpelli 1,374,451 (500,000) 155,339 1,029,790 - -
Mr M D Hancock 1,433,334 (633,334) - 800,000 - -
Mr C A Banasik 1,666,668 (516,667) - 1,150,001 - 350,001
Dr N Streltsova - - - - - -
Executives
Mr R J Fitzhardinge 1,436,832 (500,000) 146,234 1,083,066 - -
Mr J W Westdorp 1,076,859 - 160,949 1,237,808 - -
Mr W E Foote 195,910 - 171,986 367,896 - -
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CENTAURUS METALS LIMITED ANNUAL REPORT

CENTAURUS METALS ANNUAL REPORT 2022

16.6.3 Analysis of Movements in Options

The movement during the reporting period, by value, of options over ordinary shares in the Company held by each director, key management person and each of the Company executives and relevant Group executives is detailed below:

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Value of Value of
Value of Options Options
Options Exercised in Lapsed in
Granted $ [(1)] Year $ [(2)] Year $ [(3)]
Director
Mr D M Murcia - 780,867 -
Mr D P Gordon 490,241 623,334 -
Mr B R Scarpelli 170,725 467,500 -
Mr M D Hancock - 530,967 -
Mr C A Banasik - 427,134 -
Dr N Streltsova - - -
Executives
Mr R J Fitzhardinge 160,718 467,500 -
Mr J W Westdorp 176,891 - -
Mr W E Foote 189,021 - -
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(1) The value of options granted in the year is the fair value of the options calculated at grant date using either a Black Scholes option-pricing model or a Monte Carlo option pricing model. The total value of the options granted is included in the table above. This amount is allocated to remuneration over the vesting period.

(2) The value of options exercised during the year is calculated as the market price of shares of the Company as at close of trading on the date the options were exercised after deducting the price paid to exercise the option.

(3) The value of unvested options that lapsed during the year represents the benefit forgone and is calculated at the date the options lapsed using the Black Scholes option-pricing model assuming the performance criteria had been achieved. To the extent that the options are out of the money upon lapsing, the value is nil.

16.6.4 Performance Based Remuneration Granted and Forfeited During the Year

During the year, the Board determined to pay STIs to executives in recognition of the achievement of performance targets for the year ended 31 December 2022. There were no increases in the target STI quantum during the period. A summary of STIs for the period is shown below.

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Target STI
Quantum (% of Target FY22 STI STI Quantum STI Quantum
Executive Base Salary) Quantum $ Earned $ Forfeited $
Mr D P Gordon 50% 242,500 162,475 80,025
Mr B S Scarpelli 35% 118,230 79,214 39,016
Mr W E Foote [(1)] 30% 112,000 75,174 36,826
Mr J W Westdorp 30% 105,000 70,350 34,650
Mr R J Fitzhardinge 30% 76,320 51,134 25,186
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(1) 20% in 2021 due to engagement during the period.

16.6.5 Key Management Personnel Transactions

(a) Loans to Key Management Personnel and Their Related Parties

No loans have been made to directors or other key management personnel of Centaurus Metals Limited or the Group.

(b) Key Management Personnel and Director Transactions

Key Management Personnel, or their related parties, hold positions in other entities that result in them having control or significant influence over the financial or operating policies of these entities.

One of these entities transacted with the Group in the reporting period. The terms and conditions of the transactions with key management personnel and their related parties were no more favourable than those available, or which might reasonably be expected to be available, on similar transactions to non-key management personnel related entities on an arm’s length basis.

50 ANNUAL REPORT CENTAURUS METALS LIMITED

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The aggregate value of transactions and outstanding balances relating to key management personnel and entities over which they have control or significant influence were as follows:

Transaction Value	Balance Outstanding as at
Key Management Person Transaction 2022 $ 2021 $	31 Dec 2022 $ 31 Dec 2021 $
Mr D M Murcia(1) Legal fees 21,578 8,156 Total and current liabilities	6,015 -
	6,015 -

(1) Payable to MPH Lawyers, a firm in which Mr Murcia is a partner.

16.6.6 Shareholdings of Key Management Personnel

The movement during the reporting period of ordinary shares in Centaurus Metals Limited held, directly, indirectly and beneficially, by each KMP, including their related parties, is as follows:

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Received on Held at 31
Held 1 January exercise of December
2022 options Other Changes [ (1)] 2022
Directors
Mr D M Murcia 1,338,633 933,334 (500,000) 1,771,967
Mr D P Gordon 6,118,879 666,667 (450,000) 6,335,546
Mr B R Scarpelli 666,667 500,000 - 1,166,667
Mr M D Hancock 728,920 633,334 (250,000) 1,112,254
Mr C A Banasik 583,334 516,667 (150,000) 950,001
D N Streltsova - - 85,000 85,000
Executives
Mr R J Fitzhardinge 6,250,724 500,000 (600,000) 6,150,724
Mr J W Westdorp 126,800 - - 126,800
Mr W E Foote - - - -
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(1) Represents shares sold with the exception of D N Streltsova which comprises balance on appointment.

All equity transactions with Key Management Personnel other than those arising from the exercise of remuneration options have been entered into under terms and conditions no more favourable than those the Group would have adopted if dealing at arms-length.

This report is signed in accordance with a resolution of the directors.

D P Gordon Managing Director Perth 30 March 2023

CENTAURUS METALS LIMITED ANNUAL REPORT

CENTAURUS METALS ANNUAL REPORT 2022

Lead Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001

To the Directors of Centaurus Metals Limited

I declare that, to the best of my knowledge and belief, in relation to the audit of Centaurus Metals Limited for the financial year ended 31 December 2022 there have been:

i. no contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in relation to the audit; and
ii. no contraventions of any applicable code of professional conduct in relation to the audit.

KPMG

Graham Hogg Partner Perth 30 March 2023

52 ANNUAL REPORT CENTAURUS METALS LIMITED

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Consolidated Statement of Profit or Loss and Other Comprehensive Income

For the year ended 31 December 2022

	31 December 2022 $ 31 December 2021 $
Profit or Loss Other income Note 7 Exploration expenditure Impairment of other receivables Note 15 Employee benefits expense Note 8 Share based payments expense Note 9 Listing and share registry fees Professional fees Depreciation Other expenses Results from operating activities Interest income Finance expense Note 20 Net finance income Loss before income tax Loss for the period Other Comprehensive Income Items that may be reclassified subsequently to profit or loss Exchange differences arising on translation of foreign operations Other comprehensive loss for the period Total comprehensive loss for the period Earnings per Share Basic loss per share Note 12 Diluted loss per share Note 12	534,900 265,862 (36,225,206) (13,198,599) (2,359,170) (707,729) (2,497,517) (1,840,182) (1,143,562) (781,107) (153,333) (121,082) (604,165) (321,052) (362,832) (131,342) (1,131,348) (386,790)
	(43,942,233) (17,222,021) 1,348,066 235,207 (33,388) (7,901)
	1,314,678 227,306 (42,627,555) (16,994,715)
	(42,627,555) (16,994,715)
	1,149,970 (13,896)
	1,149,970 (13,896)
	(41,477,585) (17,008,611)
	cents cents (10.14) (5.04) (10.14) (5.04)

The above Consolidated Statement of Profit or Loss and Other Comprehensive Income should be read in conjunction with the accompanying Notes.

CENTAURUS METALS LIMITED ANNUAL REPORT

CENTAURUS METALS ANNUAL REPORT 2022

Consolidated Statement of Financial Position

As at 31 December 2022

	31 December 2022 $ 31 December 2021 $
Current assets Cash and cash equivalents Note 13 Other receivables and prepayments Note 15 Inventories Total current assets Non-current assets Other receivables and prepayments Note 15 Property, plant and equipment Note 16 Exploration and evaluation assets Note 17 Total non-current assets Total assets Current liabilities Trade and other payables Note 18 Financial liability Note 19 Lease liability Note 20 Employee benefits – annual leave Total current liabilities Non-current liabilities Financial liability Note 19 Lease liability Note 20 Employee benefits – long service leave Total non-current liabilities Total liabilities Net assets Equity Share capital Reserves Accumulated losses Total equity	34,047,722 8,259,389 1,329,338 529,725 58,152 -
	35,435,212 8,789,114
	49,209 8,156 8,903,956 6,004,233 13,006,304 12,048,261
	21,959,469 18,060,650
	57,394,681 26,849,764
	4,589,016 2,893,287 1,432,088 5,161,448 540,419 86,576 552,779 379,516
	7,114,302 8,520,827
	183,926 1,325,267 488,512 29,334 279,242 223,690
	951,680 1,578,291
	8,065,982 10,099,118
	49,328,699 16,750,646
	236,289,294 162,962,306 (5,819,170) (7,697,790) (181,141,425) (138,513,870) 49,328,699 16,750,646

The above Consolidated Statement of Financial Position should be read in conjunction with the accompanying Notes.

54 ANNUAL REPORT CENTAURUS METALS LIMITED

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		Total Equity	$	16,750,646	(42,627,555)	1,149,970	(41,477,585)	1,143,562	75,475,000	1,052,700	(3,615,624)	-	74,055,638	49,328,699	26,118,316	(16,994,715)	(13,896)	(17,008,611)	781,107	1,400,000	5,462,629	(2,795)	-	-	7,640,941	16,750,646
	Accumulated	Losses	$	(138,513,870)	(42,627,555)	-	(42,627,555)	-	-	-	-	-	-	(181,141,425)	(121,519,155)	(16,994,715)	-	(16,994,715)	-	-	-	-	-	-	-	(138,513,870)
Foreign Currency	Translation	Reserve	$	(9,236,393)	-	1,149,970	1,149,970	-	-	-	-	-	-	(8,086,423)	(9,222,497)	-	(13,896)	(13,896)	-	-	-	-	-	-	-	(9,236,393)
Share-Based	Payments	Issued Capital Reserve	$ $	Balance at 1 January 2022 162,962,306 1,538,603	Loss for the period - -	Foreign currency translation difference for foreign operation - -	Total comprehensive loss for the period - -	Share-based payment transactions - 1,143,562	Issues of ordinary shares 75,475,000 -	Share options exercised 1,052,700 -	Share issue costs (3,615,624) -	Transfer on exercise of options 414,912 (414,912)	Total transactions with owners 73,326,988 728,650	Balance at 31 December 2022 236,289,294 2,267,253	Balance at 1 January 2021 155,905,034 954,934	Loss for the period - -	Foreign currency translation difference for foreign operation - -	Total comprehensive loss for the period - -	Share-based payment transactions 781,107	Issues of ordinary shares 1,400,000 -	Share options exercised 5,462,629 -	Share issue costs (2,795) -	Transfer on exercise of options 197,438 (197,438)	Transfer of options lapsed - -	Total transactions with owners 7,057,272 583,669	Balance at 31 December 2021 162,962,306 1,538,603	The amounts recognised directly in equity are disclosed net of tax.	The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying Notes.

CENTAURUS METALS LIMITED ANNUAL REPORT

CENTAURUS METALS ANNUAL REPORT 2022

Consolidated Statement of Cash Flows

For the year ended 31 December 2022

	31 December 2022 31 December 2021
Note	$ $
Cash flows from operating activities Exploration and evaluation expenditure Payments to suppliers and employees (inclusive of GST) Other receipts Interest received Net cash used in operating activities Note 14 Cash flows from investing activities Payments for property plant & equipment Payment for exploration acquisitions Buy back of project royalty Proceeds from sale of property plant & equipment Net cash used in investing activities Cash flows from financing activities Proceeds from issue of equity securities Proceeds from the exercise of options Capital raising costs Payment of lease liability Net cash from financing activities Net increase/(decrease) in cash and cash equivalents Cash and cash equivalents at the beginning of the period Effect of exchange rate fluctuations on cash held Cash and cash equivalents at 31 December Note 13	(37,758,214) (12,898,881) (3,783,579) (2,560,610) 265,862 - 1,303,051 240,659
	(39,972,880) (15,218,832)
	(3,507,396) (3,323,381) (2,367,239) (1,485,458) (1,000,000) (1,000,000) 20,249 -
	(6,854,386) (5,808,839)
	75,000,000 - 1,052,700 5,462,629 (3,329,802) (2,795) (252,215) (109,991)
	72,470,683 5,349,843
	25,643,417 (15,677,828) 8,259,389 24,089,281 144,916 (152,064) 34,047,722 8,259,389

The above Consolidated Statement of Cash Flows should be read in conjunction with the accompanying Notes.

56 ANNUAL REPORT CENTAURUS METALS LIMITED

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Notes to the Consolidated Financial Statements

For the year ended 31 December 2022

Note 1. Reporting Entity

Centaurus Metals Limited (“the Company”) is a company domiciled in Australia. The Company’s registered office is at Level 2, 1 Ord Street, West Perth WA 6005. The consolidated financial statements of the Company as at and for the year ended 31 December 2022 comprise the Company and its subsidiaries (collectively the “Group” and individually “Group entities”). The Group is a for-profit entity and is primarily involved in exploration for and evaluation of mineral resources.

Note 2. Basis of Preparation

Statement of Compliance

The consolidated financial statements are general purpose financial statements which have been prepared in accordance with Australian Accounting Standards (AASBs) (including Australian Accounting Interpretations) adopted by the Australian Accounting Standards Board (AASB) and the Corporations Act 2001. The consolidated financial statements comply with International Financial Reporting Standards (IFRS’s) adopted by the International Accounting Standards Board (IASB).

The consolidated financial statements were authorised for issue by the Board of Directors on 30 March 2023.

Basis of Measurement

The consolidated financial statements have been prepared on the historical cost basis, except for share based payments which are measured at fair value in the statement of financial position.

Going Concern

The financial statements for the year ended 31 December 2022 have been prepared on a going concern basis, which contemplates continuity of normal business activities and the realisation of assets and settlement of liabilities in the ordinary course of business.

During the year, the Group incurred a loss after tax of $42,627,555 with net cash inflows of $25,643,417. The Group has a working capital surplus of $28,320,910.

While the Group had cash on hand of $34,047,722 as at 31 December 2022, the Group is likely to need additional working capital in order to meet the Group’s stated strategic objectives. Whilst there is no certainty that additional funding will be available to provide adequate working capital for the Group to achieve its planned objectives, the Directors believe that the Group will be able to secure funding sufficient to meet requirements to continue as a going concern based on the Company’s historical success of raising capital. The form, value and timing of any future transactions that may provide funding is yet to be determined and will depend amongst other things, on capital markets, commodity prices and the outcome of planned exploration and evaluation activities.

The Directors have a reasonable expectation that further funding will be obtained to meet the Group’s objectives. In addition, the Directors have considered the minimum expenditure requirements necessary in order to maintain tenements in good standing and to meet committed expenditures for the 12 month period from the date of this report and consider the going concern basis of preparation to be appropriate. In undertaking this analysis, the Directors have considered which expenditure can be reduced if necessary.

Note 3. Functional and Presentation Currency

These consolidated financial statements are presented in Australian Dollars, which is the Company’s functional currency. The functional currency of the Brazilian subsidiaries is the Brazilian Real.

Note 4. Use of Judgements and Estimates

In preparing these consolidated financial statements, management has made judgements, estimates and assumptions that affect the application of the Group’s accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future periods affected.

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Judgements

Information about judgements made in applying accounting policies that have the most significant effects on the amounts recognised in the consolidated financial statements is included below and also in the following notes:

Note 15 - Other Receivables and Prepayments; and
Note 17 - Exploration and Evaluation Assets. The application of the Group’s accounting policy for exploration and evaluation expenditure requires judgement to determine whether future economic benefits are likely, from either future exploitation or sale, or whether activities have not reached a stage that permits a reasonable assessment of the existence of reserves.

Assumptions and Estimation Uncertainties

Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment to the carrying amounts of assets and liabilities in the year ending 31 December 2022 is included in Note 17 – Exploration and Evaluation Assets. In addition to applying judgement to determine whether future economic benefits are likely to arise from the Group’s Exploration and Evaluation assets or whether activities have not reached a stage that permits a reasonable assessment of the existence of Reserves, the Group has to apply a number of estimates and assumptions.

The Group is required to make estimates and assumptions as to future events and circumstances, in particular, whether successful development and commercial exploitation, or alternatively sale, of the respective areas of interest will be achieved. Critical to this assessment are estimates and assumptions as to Ore Reserves, the timing of expected cash flows, exchange rates, commodity prices and future capital requirements. Changes in these estimates and assumptions as new information about the recoverability of Ore Reserves becomes available, may impact the assessment of the recoverable amount of exploration and evaluation assets. If, after the expenditure is capitalised, information becomes available suggesting that the recovery of expenditure is unlikely, the relevant capitalised amount is written off to profit or loss in the period when that information becomes available.

Measurement of Fair Values

A number of the Group’s accounting policies and disclosures require the measurement of fair values, for both financial and non-financial assets and liabilities.

Fair values have been determined for measurement and/or disclosure purposes based on the methods described below. When applicable, further information about the assumptions made in determining fair values is disclosed in the notes specific to that asset or liability.

(a) Trade and Other Receivables

The fair value of trade and other receivables is estimated as the present value of future cash flows, discounted at the market rate of interest at the reporting date.

(b) Share-based Payment Transactions

The fair value of employee share options is estimated using the applicable valuation methodology. Measurement inputs include share price on measurement date, exercise price of the instrument, expected volatility (based on weighted average historic volatility adjusted for changes expected due to publicly available information), weighted average expected life of the instruments (based on historical experience and general option holder behaviour), expected dividends, and the risk-free interest rate (based on government bonds). Service and performance conditions attached to vesting are not taken into account in determining fair value. Where the service period commences prior to grant date the fair value is provisionally calculated and subsequently revised upon grant date.

Note 5. Significant Accounting Policies

The Group has consistently applied the following accounting policies to all periods presented in these consolidated financial statements.

Basis of Consolidation

(a) Subsidiaries

Subsidiaries are entities controlled by the Group. The Group controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases.

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The accounting policies of subsidiaries have been changed when necessary to align them with policies adopted by the Group.

(b) Transactions Eliminated on Consolidation

Inter-Group balances and transactions and any unrealised income and expenses arising from intra-Group transactions, are eliminated in preparing the consolidated financial statements.

Foreign Currency

(a) Foreign Currency Transactions

Transactions in foreign currencies are translated to the respective functional currencies of Group entities at exchange rates at the dates of the transactions.

Monetary assets and liabilities denominated in foreign currencies are retranslated to the functional currency at the foreign exchange rate at the reporting date. The foreign currency gain or loss on monetary items is the difference between amortised cost in the functional currency at the beginning of the period, adjusted for effective interest and payments during the period, and the amortised cost in foreign currency translated at the exchange rate at the end of the period. Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are retranslated to the functional currency at the exchange rate at the date that the fair value was determined.

Foreign currency differences arising on retranslation are recognised in profit or loss, except for differences arising on the retranslation of financial instruments, a financial liability designated as a hedge of the net investment in a foreign operation, or qualifying cash flow hedges, which are recognised in other comprehensive income. Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of the transaction.

(b) Foreign Operations

The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on acquisition, are translated to Australian dollars at exchange rates at reporting date. The income and expenses of foreign operations are translated to Australian dollars at average exchange rates for the period.

Foreign currency differences are recognised in other comprehensive income and presented in the foreign currency translation reserve (FCTR) within equity.

When a foreign operation is disposed of, in part or in full, the relevant amount in the FCTR is transferred to profit or loss as part of the profit or loss on disposal.

When the settlement of a monetary item receivable from or payable to a foreign operation is neither planned nor likely in the foreseeable future, foreign exchange gains and losses arising from such a monetary item are considered to form part of a net investment in a foreign operation and are recognised in other comprehensive income and are presented within equity in the FCTR.

Comparative Revisions

Where necessary comparative figures have been adjusted to conform with changes in presentation in the current financial year.

Financial Instruments

The Group classifies non-derivative financial assets into the following categories at fair value through profit and loss, at fair value through other comprehensive income and measured at amortised cost.

The Group classifies non-derivative financial liabilities into the other financial liabilities category.

(a) Non- derivative Financial Assets and Financial Liabilities – Recognition and Derecognition

The Group initially recognises loans, receivables and deposits on the date when they are originated. All other financial assets and financial liabilities are recognised initially on the trade date.

The Group derecognises a financial asset when the contractual rights to the cash flows from the asset expire, or it transfers the rights to receive the contractual cash flows on the financial asset in a transaction in which substantially all the risks and rewards of ownership of the financial asset are transferred, or it neither transfers nor retains substantially all of the risks and rewards of ownership and does not retain control over the transferred asset. Any interest in such derecognised financial assets that is created or retained by the Group is recognised as a separate asset or liability.

The Group derecognises a financial liability when its contractual obligations are discharged, cancelled or expire.

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Financial assets and liabilities are offset and the net amount presented in the statement of financial position when and only when, the Group has a legal right to offset the amounts and intends either to settle on a net basis or to realise the asset and settle the liability simultaneously.

The Group has the following non-derivative financial assets: receivables and cash and cash equivalents.

(i) Receivables

Receivables are financial assets with fixed or determinable payments that are not quoted in an active market. Such assets are recognised initially at fair value plus any directly attributable transaction costs. Subsequent to initial recognition, receivables are measured at amortised cost using the effective interest method, less any impairment losses.

(ii) Cash and Cash Equivalents

Cash and cash equivalents comprise cash balances and call deposits with original maturities of three months or less.

(b) Non derivative Financial Liabilities – Measurement

Non-derivative financial liabilities are initially recognised at fair value less any directly attributable transaction costs. Subsequent to initial recognition, these liabilities are measured at amortised cost using the effective interest method.

(c) Share Capital

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary shares or share options are recognised as a deduction from equity, net of any tax effect.

Property, Plant and Equipment

(a) Recognition and Measurement

Items of property, plant and equipment are measured at cost less accumulated depreciation and any accumulated impairment losses. Cost includes expenditure that is directly attributable to the acquisition of the asset.

If significant parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment.

Any gains or loss on disposal of an item of property, plant and equipment are recognised in profit or loss. When revalued assets are sold, the amounts included in the revaluation reserve are transferred to retained earnings.

(b) Depreciation

Depreciation is calculated to write off the cost of items of property, plant and equipment less their estimated residual values using the straight-line method over their estimated useful lives and is generally recognised in profit or loss. Land is not depreciated.

The estimated useful lives of property, plant and equipment are 3 to 15 years.

Depreciation methods, useful lives and residual values are reviewed at each financial year-end and adjusted if appropriate.

Exploration and Evaluation Expenditure

Exploration and evaluation costs are expensed in the year they are incurred. Acquisition costs are carried forward where right of tenure of the area of interest is current and they are expected to be recouped through sale or successful development and exploitation of the area of interest, or, where exploration and evaluation activities in the area of interest have not reached a stage that permits reasonable assessment of the existence of economically recoverable reserves.

Where an area of interest is abandoned, or the directors decide that it is not commercial, any accumulated acquisition costs in respect of that area are written off in the financial period in which the decision is made. Each area of interest is also reviewed at the end of each accounting period and accumulated costs written off to the extent that they will not be recoverable in the future.

Amortisation is not charged on costs carried forward in respect of areas of interest in the development phase until production commences.

Exploration and evaluation assets are transferred to Development Assets once technical feasibility and commercial viability of an area of interest is demonstrable. Exploration and evaluation assets are assessed for impairment and any impairment loss is recognised prior to being reclassified.

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The carrying amount of the exploration and evaluation assets is dependent on successful development and commercial exploitation, or alternatively, sale of the respective area of interest.

Exploration and evaluation assets are assessed for impairment if sufficient data exists to determine technical feasibility and commercial viability or facts and circumstances suggest that the carrying amount exceeds the recoverable amount.

Exploration and evaluation assets are tested for impairment when any of the following facts and circumstances exist:

The term of exploration license in the specific area of interest has expired during the reporting period or will expire in the near future and is not expected to be renewed;
Substantive expenditures on further exploration for and evaluation of mineral resources in the specific area are not budgeted nor planned;
Exploration for and evaluation of mineral resources in the specific area has not led to the discovery of commercially viable quantities of mineral resources and the decision was made to discontinue such activities in the specified area; or
Sufficient data exists to indicate that although a development in the specific area is likely to proceed, the carrying amount of the exploration and evaluation asset is unlikely to be recovered in full from successful development or by sale.

Where a potential impairment is indicated, an assessment is performed for each cash-generating unit which is no larger than the area of interest. The Group performs impairment testing in accordance with the Accounting Policy as detailed below.

Leases

A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

The Group recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset recognised by the Group is initially measured at cost, comprised of the initial measurement of the related lease liability, any lease payments made at or before the commencement of the contract, less any lease incentives received, any initial direct costs and any restoration costs. Subsequently the asset is measured at cost less any accumulated depreciation and impairment losses and adjusted for certain re-measurements of the lease liability. Right-of-use assets are depreciated over the shorter period of either the useful life of the underlying asset or the lease term.

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be determined the lessee’s incremental borrowing rate is used, being the rate the lessee would have to pay to borrow funds necessary to obtain an asset of similar value in a similar economic environment with similar terms and conditions.

The lease liability is subsequently increased by the interest costs on the lease liability and decreased by lease payments made. It is re-measured where there is a change in future lease payments arising from a change in an index rate, or as appropriate, changes in the assessment of whether an extension option is reasonably certain to be exercised.

The Group applies the low-value assets and the short-term lease exemptions to leases. Lease payments on short term leases and leases of low-value assets are recognised as an expense on a straight-line basis over the lease term.

Asset Acquisition

When an asset acquisition does not constitute a business combination, the assets and liabilities are assigned a carrying amount based on their relative fair values. No deferred tax is recognised in relation to the acquired assets and assumed liabilities as the initial recognition exemption for deferred tax under AASB 112 applies. No goodwill will arise on the acquisition of the net assets and transaction costs relating to the asset acquisition will be included in the capitalised cost of the asset.

Any contingent consideration arising from the acquisition will be recognised at fair value at the acquisition date. Contingent consideration classified as a liability that is a financial instrument and within the scope of AASB 9 is measured at fair value, with changes in fair value recognised in profit or loss in the statement of profit or loss and other comprehensive income in accordance with AASB 9.

Inventory

Inventory comprises of diesel and is recognised and valued at the lower of cost or net realisable value (“NRV”). NRV is the estimated future selling price, less the estimated costs necessary to make the sale. Cost represents weighted average cost of the diesel on hand.

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Impairment

(a) Non-derivative Financial Assets

A loss allowance for expected credit loss (ECL) is recognised on financial assets measured at amortised cost.

The loss allowances are measured at an amount equal to lifetime ECLs, except for, bank balances which are measured at 12-month ECLs, for which credit risk (i.e. the risk of default occurring over the expected life of the financial instrument) has not increased significantly since initial recognition.

Loss allowances for trade receivables are always measured at an amount equal to lifetime ECLs.

When determining whether the credit risk of a financial asset has increased significantly since initial recognition and when estimating ECLs, the Group considers reasonable and supportable information that is relevant and available without undue cost or effort. This includes both quantitative and qualitative information and analysis, based on the Group’s historical experience and informed credit assessment and including forward-looking information.

The Group assumes that the credit risk on a financial asset has increased significantly if it is more than 30 days past due. The Group considers a financial asset to be in default when the financial asset is more than 90 days past due.

Lifetime ECLs are the ECLs that result from all possible default events over the expected life of a financial instrument. 12month ECLs are the portion of ECLs that result from default events that are possible within the 12 months after the reporting date (or a shorter period if the expected life of the instrument is less than 12 months).

The maximum period considered when estimating ECLs is the maximum contractual period over which the Group is exposed to credit risk.

(i) Measurement of ECLs

ECLs are a probability-weighted estimate of credit losses. Credit losses are measured as the present value of all cash shortfalls. ECLs are discounted at the effective interest rate of the financial asset.

(ii) Credit-impaired financial assets

At each reporting date, the Group assesses whether financial assets carried at amortised costs are credit-impaired. A financial asset is ‘credit-impaired’ when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred.

Presentation of allowance for ECL in the statement of financial position

Loss allowances for financial assets measured at amortised costs are deducted from the gross carrying amount of the assets.

(iii) Write-off

The gross carrying amount of a financial asset is written off when the Group has no reasonable expectations of recovering a financial asset in its entirety or a portion thereof.

(b) Non-financial Assets

The carrying amounts of the Group’s non-financial assets, other than deferred tax assets, are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated.

The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For the purpose of impairment testing, assets that cannot be tested individually are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of assets. The group of assets is referred to as the Cash Generating Unit or CGU.

The Group’s corporate assets do not generate separate cash inflows. If there is an indication that a corporate asset may be impaired, then the recoverable amount is determined for the CGU to which the corporate asset belongs.

An impairment loss is recognised if the carrying amount of an asset or its CGU exceeds its estimated recoverable amount. Impairment losses are recognised in profit or loss. Impairment losses recognised in respect of CGUs are allocated first to reduce the carrying amount of any goodwill allocated to the units, and then to reduce the carrying amounts of the other assets in the unit (group of units) on a pro rata basis.

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In respect of assets, other than goodwill, impairment losses recognised in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.

Employee Benefits

(a) Defined Contribution Plans

A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions into a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to defined contribution plans are recognised as an employee benefit expense in profit or loss in the periods during which services are rendered by employees.

(b) Other Long-term Employee Benefits

The Group’s net obligation in respect of long-term employee benefits is the amount of future benefit that employees have earned in return for their service in the current and prior periods plus related on-costs; that benefit is discounted to determine its present value, and the fair value of any related assets is deducted.

(c) Short-term Benefits

Short-term employee benefits are expensed as the related service is provided. A liability is recognised for the amount expected to be paid if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

(d) Share-based Payment Transactions

The fair value of share-based payment awards granted to employees is recognised as an expense at grant date with a corresponding increase in equity, over the period that employees become entitled to the awards. The amount recognised as an expense is adjusted to reflect the number of awards for which the related service and non-market vesting conditions are expected to be met, such that the amount ultimately recognised as an expense is based on the number of awards that meet the related service and non-market performance conditions at the vesting date. For share-based payment awards with non-vesting conditions, the grant date fair value of the share-based payment is measured to reflect such conditions and there is no true-up for differences between expected and actual outcomes.

Share-based payment arrangements in which the Group receives goods or services as consideration for its own equity instruments are accounted for as equity-settled share-based payment transactions, regardless of how the equity instruments are obtained by the Group.

When the Company grants options over its shares to employees of subsidiaries, the fair value at grant date is recognised as an increase in the investments in subsidiaries, with a corresponding increase in equity over the vesting period of the grant.

Provisions

A provision is recognised if, as a result of a past event, the Group has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. The unwinding of the discount is recognised as a finance cost.

Revenue

Revenue is recognised when the goods are delivered and have been accepted by customers at their premises. For contracts that permit the customer to return an item, revenue is recognised to the extent that it is highly probably that a significant reversal in the amount of cumulative revenue recognised will not occur.

Therefore, the amount of revenue recognised is adjusted for expected returns, which are estimated based on the historical data. In these circumstances, a refund liability and a right to recover returned goods asset are recognised.

Finance Income and Finance Costs

Finance income comprises interest income on funds invested, dividend income, gains on the disposal of debt securities measured at fair value through other comprehensive income, changes in the fair value of financial assets at fair value through profit and loss, and gains on hedging instruments that are recognised in profit or loss. Interest income is

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recognised as it accrues in profit or loss, using the effective interest method. Dividend income is recognised in profit or loss on the date that the Group’s right to receive payment is established, which in the case of quoted securities is the exdividend date.

Finance costs comprise interest expense on borrowings, losses on the disposal of debt securities measured at fair value through other comprehensive income, changes in the fair value of financial assets at fair value through profit or loss and losses on hedging instruments that are recognised in profit or loss. Borrowing costs that are not directly attributable to the acquisition, construction or production of a qualifying asset are recognised in profit or loss using the effective interest method.

Foreign currency gains and losses are reported on a net basis.

Income Tax

Income tax expense comprises current and deferred tax. Current and deferred tax is recognised in profit or loss except to the extent that it relates to a business combination, or items recognised directly in equity or in other comprehensive income.

Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates enacted or substantively enacted at the reporting date and any adjustment to tax payable in respect of previous years.

Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes.

Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they reverse, based on the laws that have been enacted or substantively enacted by the reporting date. Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets, and they relate to income taxes levied by the same tax authority on the same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis or their tax assets and liabilities will be realised simultaneously.

A deferred tax asset is recognised for unused tax losses, tax credits and deductible temporary differences, to the extent that it is probable that future taxable profits will be available against which they can be utilised. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realised.

Goods and Services Tax and Equivalent Indirect Taxes

Revenue, expenses and assets are recognised net of the amount of goods and services tax (GST) and equivalent indirect taxes, except where the amount of tax incurred is not recoverable from the taxation authority. In these circumstances, the tax is recognised as part of the cost of acquisition of the asset or as part of the expense. Receivables and payables are stated with the amount of tax included. The net amount of tax recoverable from, or payable to, the taxation authority is included as a current asset or liability in the balance sheet.

Cash flows are included in the statement of cash flows on a gross basis. The tax components of cash flows arising from investing and financing activities which are recoverable from, or payable to, the tax authority are classified as operating cash flows.

Earnings per Share

The Group presents basic and diluted earnings per share (EPS) data for its ordinary shares. Basic EPS is calculated by dividing the profit or loss attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares outstanding during the period. Diluted EPS is determined by adjusting the profit or loss attributable to ordinary shareholders and the weighted average number of ordinary shares outstanding for the effects of all dilutive potential ordinary shares, which comprise listed options and share options granted to employees.

Segment Reporting

An operating segment is a component of the Group that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Group’s other components. All operating segment operating results are regularly reviewed by the Group’s Managing Director to make decisions about resources to be allocated to the segment and assess its performance, and for which discrete financial information is available.

Segment results that are reported to the Managing Director include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Unallocated items comprise minimal, not material corporate assets (primarily the Group’s headquarters), head office expenses, and income tax assets and liabilities. Segment capital

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expenditure is the total cost incurred during the period to acquire property, plant and equipment, and intangible assets other than goodwill.

Government Grants

Government grants that compensate the Group for expenses incurred are recognised in profit or loss as other income on a systematic basis in the periods in which the expenses are recognise, unless the conditions for receiving the grant are met after the related expenses have been recognised. In this case, the grant is recognised when it becomes receivable.

Changes in Accounting Policies

The Group has adopted the amendment to standards, including any consequential amendments to other standards, with a date of initial application of 1 January 2022.

New Standards and Interpretations Not Yet Adopted

Certain new accounting standards and interpretations have been published that are not mandatory for 31 December 2022 reporting periods and have not been early adopted by the Group These standards are not expected to have a material impact on the entity in the current or future reporting periods and on foreseesable future transactions.

There are no other standards that are not yet effective and that would be expected to have a material impact on the entity in the current or future reporting period and on foreseeable future transactions.

Note 6. Operating Segments

The Group operates in the mineral exploration industry. For management purposes the Group is organised into one main operating segment which involves the exploration of minerals. All of the Group’s activities are interrelated and financial information is reported to the Managing Director (Chief Operating Decision Maker) as a single segment. Accordingly, all significant operating decisions are based upon an analysis on the Group as one segment. The financial results and financial position from this segment are largely equivalent to the financial statements of the Group as a whole.

Geographical Segment Information	2022 Non-current Assets $ 2021 Non-current Assets $
Brazil Australia Total	21,651,685 17,968,727 307,784 91,923
	21,959,469 18,060,650

Note 7. Other Income

	31 December 2022 $ 31 December 2021 $
R&D tax refund Gain on sale of property plant & equipment Other	517,875 265,862 10,769 - 6,256 - 534,900 265,862

Note 8. Employee Benefits Expense

	31 December 2022 $ 31 December 2021 $
Salaries, fees and other benefits Superannuation Recognised in exploration expenditure expense Total	6,760,576 3,910,049 293,323 170,709 (4,556,382) (2,240,576)
	2,497,517 1,840,182

Note 9. Share-based Payments

From time to time the Group may make share-based payments in connection with its activities. These payments may comprise the issue of options under various terms and conditions. Options granted carry no dividend or voting rights. When exercisable, each option is converted into one ordinary share of the Company with full dividend and voting rights.

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During the reporting period 1,225,220 options were issued to employees and directors (2021: 1,395,452). Options issued to employees were issued under the Employee Share Incentive Plan approved by shareholders at the Annual General Meeting on 27 May 2022. Options issued to executive directors were approved by shareholders under ASX Listing Rule 10.11.

Reconciliation of Outstanding Share Options

The number and weighted average exercise prices of share options issued are as follows:

Weighted Average Exercise Price 2022	Number of Options 2022 Weighted Average Exercise Price 2021	Number of Options 2021
Outstanding at start of period $0.1822 Exercised during the period $0.2807 Lapsed during the period - Issued during the period $0.0000 Outstanding at balance date $0.1212 Exercisable at balance date $0.1800	12,247,857 $0.2172 (3,750,002) $0.0021 - - 1,225,220 $0.0000 9,723,075 $0.1822 350,001 $0.2721	12,085,733 (1,233,335) - 1,395,452
		12,247,857 4,100,003

The options outstanding at 31 December 2022 have exercise prices ranging from $0.000 to $0.405 (2021: $0.000 to $0.405) and the weighted average remaining contractual life is 1.40 years (2021: 1.61 years).

There were 3,750,002 options exercised during the year (2021: 1,233,335). There were 1,225,220 options issued during the year (2021: 1,395,452). Details of the options issued during the year are as follows:

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Grant Date Number of Options Vesting Period [(1)] Option Term
Directors
23/03/22 300,700 36 months [(2)] 48 months
23/03/22 300,698 36 months [(3)] 48 months
Total 601,398
Employees
23/03/22 311,912 36 months [(2)] 48 months
23/03/22 311,910 36 months [(3)] 48 months
623,822
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(1) From 1 January 2022 subject to continued employment.

(2) Options will vest in the future subject to performance and services based vesting conditions being met. The Company’s share price performance is measured via relative Total Shareholder Return (TSR). The Company’s TSR is measured against a peer group of companies. Vesting will occur subject to meeting a three-year service condition to 31 December 2024 and the performance condition tested against the relative TSR measure for the period 1 January 2022 to 31 December 2024.

(3) Vesting will occur subject to meeting a three-year service condition to 31 December 2024 and the performance condition tested against the absolute TSR measure for the period 1 January 2022 to 31 December 2024.

The following table sets out the vesting outcome based on the Company’s relative TSR performance.

TSRpercentile compared topeergroup	Percentage Options that vest
<50th percentile	0%
Between 50thand 75th percentile	Pro-rata between 50% and 100%
>75th percentile	100%

No options will vest unless the percentile ranking of the Company’s TSR for the relevant performance year, as compared to the TSRs for the Peer Group companies, is at or above the 50th percentile.

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The following table sets out the vesting outcome base on the Company’s Absolute TSR performance

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Assessment Table
Threshold TSR Level over Amount of ZEPOs which will vest
Assessment Period and become exercisable
Less than 30% Zero
B/t 30% and 40% 50%
B/t 40% and 50% 75%
50% or greater 100%
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Inputs for Measurement of Grant Date Fair Values

The fair value at grant date of the share-based payments is charged to the income statement over the period which the benefits of the employee services are expected to be derived. The fair values of awards granted were estimated using a either a Monte Carlo simulation or a Black-Scholes option pricing technique taking into account the following inputs:

Grant Date	Expiry Date	Exercise Price	Life of option	Share price at grant date	Expected share price volatility	Vesting condition	Risk-free interest rate	Fair Value at grant date
23/03/22 23/03/22	31/12/25 31/12/25	$0.000 $0.000	3.78 years 3.78 years	$1.30 $1.30	100% 100%	Relative TSR Absolute TSR	2.173% 2.173%	$1.1485 $1.0496

Expenses Arising from Share Based Payment Transactions

	31 December 2022 $ 31 December 2021 $
Total expense recognised as share-based payment – share options	1,143,562 781,107

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CENTAURUS METALS ANNUAL REPORT 2022

Note 10. Income Tax

Numerical Reconciliation of Income Tax Expense to Prima Facie Tax Payable

	31 December 2022 $ 31 December 2021 $
Loss from continuing operations before income tax expense Tax at the Australian tax rate of 27.5% (2021: 27.5%) Tax effect of amounts which are not deductible/(taxable) in calculating taxable income: Overseas project generation and review costs Share-based payments Non assessable grant income Sundry items Effect of tax rates in foreign jurisdictions Under provision from prior year Deferred tax assets not recognised Income tax benefit, being deferred tax Tax Losses	(42,627,555) (16,994,715)
	(11,722,578) (4,673,547) 1,997,922 822,525 314,479 214,805 (142,416) (73,113) (222,930) 9,918
	(9,775,523) (3,699,412) (27,327) (8,886) (326,378) (761,674) 10,129,228 4,469,972 - -

	31 December 2022 $ 31 December 2021 $
Tax losses Potential tax benefit (between 27.5-34%)	66,189,799 61,188,366 19,677,571 18,096,045

The tax losses do not expire under current tax legislation. Deferred tax assets have not been recognised in respect of remaining tax losses because it is not probable that future taxable profit will be available against which the Group can utilise the benefit.

Deferred Tax Assets

The following deferred tax balances have not been recognised:

	31 December 2022 $ 31 December 2021 $
Deferred Tax Assets Exploration expenditure Accrued expenses/provisions Transaction costs relating to issue of capital Tax losses carried forward (net of tax losses utilised)	21,247,510 9,931,563 8,992,211 10,916,869 246,235 80,887 19,677,571 18,096,045 50,163,527 39,025,364

The tax benefits of the above deferred tax assets will only be obtained if:

The Company derives future assessable income of a nature and of an amount sufficient to enable the benefit to be utilized;
The Company continues to comply with the conditions for the deductibility imposed by law; and
No changes in income tax legislation adversely affect the Company in utilising the benefits.

Note 11. Dividends

There were no dividends paid or declared during the period (2021: nil).

ANNUAL REPORT CENTAURUS METALS LIMITED

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Note 12. Earnings/(Loss) per Share

Basic Loss per Share

The calculation of basic and diluted earnings per share at 31 December 2022 was based on the loss attributable to ordinary shareholders of $42,627,555 (2021: $16,994,715) and a weighted average number of ordinary shares outstanding of 420,198,738 (2021: 337,081,397), calculated as follows:

Loss Attributable to Ordinary Shareholders

	31 December 2022 $ 31 December 2021 $
Loss attributable to the shareholders	(42,627,555) (16,994,715)

Weighted Average Number of Ordinary Shares

	2022 Number 2021 Number
Issued ordinary shares at beginning of the period Effect of shares issued Weighted average number of ordinary shares at the end of the period Loss per share (cents) Diluted loss per share (cents)	358,291,616 325,857,160 61,907,122 11,224,237
	420,198,738 337,081,397
	(10.14) (5.04) (10.14) (5.04)

Diluted Earnings per Share

Potential ordinary shares were not considered to be dilutive as the Group made a loss for the year ended 31 December 2022 and the exercise of potential shares would not increase that loss.

Note 13. Cash and Cash Equivalents

	31 December 2022 $ 31 December 2021 $
Cash at bank and on hand Deposits - short term	760,413 9,154 33,287,309 8,250,235
	34,047,722 8,259,389

The deposits are bearing floating and fixed interest rates between 3.15% & 3.81% in Australia and 12.39% & 12.92% in Brazil (2021: between 0.06% Australia and 4.79% Brazil).

Note 14. Reconciliation of Cash Flows from Operating Activities

	31 December 2022 $ 31 December 2021 $
Loss for the period Adjustments for: Depreciation Non-cash employee benefits expense– share based payments (Profit)/Loss on sale of plant and equipment Operating loss before changes in working capital and provisions Change in other receivables Change in trade creditors and provisions Net cash used in operating activities	(42,627,555) (16,994,715) 537,137 222,395 1,143,562 781,107 (10,769) -
	(40,957,625) (15,991,213)
	(1,050,692) (321,775)
	2,035,437 1,094,156
	(39,972,880) (15,218,832)

CENTAURUS METALS LIMITED ANNUAL REPORT

CENTAURUS METALS ANNUAL REPORT 2022

Note 15. Other Receivables and Prepayments

	31 December 2022 $ 31 December 2021 $
Current R&D tax refund Other Receivables Security deposits Prepayments Non – Current Other Receivables Provision for impairment Security deposits	517,875 265,862 228,463 67,446 76,293 33,648 506,707 162,769
	1,329,338 529,725
	3,570,292 1,008,755 (3,563,969) (1,000,599) 42,886 - 49,209 8,156

Non-current Other Receivables include Brazilian federal VAT (PIS-Cofins) levied on the Group’s purchases. Recoverability of PIS-Cofins assets is dependent upon the Group generating a federal company tax liability, which may be offset against the Group’s PIS-Cofins assets if the Group elects to do so.

The current practice of the Group is to impair PIS-Cofins assets given the pre-development status of the Jaguar Project.

During the period the entity wrote off $3,876 which was previously provided for due to credits expiring (2021: $3,388). An impairment expense of $2,359,170 was recognized on indirect taxes receivable in 2022 (2021: $707,729). Information about the Group’s exposure to credit and market risk and impairment losses for other receivables is included in Note 25.

Note 16. Property, Plant and Equipment

	31 December 2022 $ 31 December 2021 $
At Cost Accumulated depreciation	9,958,972 6,526,942 (1,055,016) (522,709)
	8,903,956 6,004,233

Movements in Carrying Amounts

Movements in the carrying amounts for each class of property, plant and equipment between beginning and end of the current financial year.

	31 December 2022 $ 31 December 2021 $
Plant and Equipment Carrying amount at beginning Additions Disposals Depreciation Effect of movements in exchange rates Carrying amount at end Land and Buildings Carrying amount at beginning Additions Depreciation Effect of movements in exchange rates Carrying amount at end	880,659 457,064 873,156 549,727 (13,284) (4,105) (193,126) (116,079) 51,935 (5,948)
	1,599,340 880,659 5,010,056 175,901 565,807 4,885,835 (5,510) (1,915) 723,556 (49,765)
	6,293,909 5,010,056

70 ANNUAL REPORT CENTAURUS METALS LIMITED

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Right-of-use assets (see also Note 20) Carrying amount at beginning Additions Depreciation Effect of movements in exchange rates Carrying amount at end Total	113,518 152,029 1,219,588 68,218 (327,768) (104,400) 5,369 (2,329)
	1,010,707 113,518
	8,903,956 6,004,233

Additions to Land in 2021 include the allocation of the fair value of 3 properties at the Jaguar Project which Centaurus has secured possession of.

Note 17. Exploration and Evaluation Assets

	31 December 2022 $ 31 December 2021 $
Opening net book value Additions Effect of movements in exchange rate	12,048,261 8,764,153 66,466 3,402,083 891,577 (117,975)
	13,006,304 12,048,261

The ultimate recoupment of exploration and evaluation expenditure carried forward is dependent on successful development and commercial exploitation or, alternatively, sale of the respective project areas.

Note 18. Trade and Other Payables

	31 December 2022 $ 31 December 2021 $	31 December 2022 $ 31 December 2021 $


Current Trade and other creditors Accrued expenses Note 19. Financial Liability		3,286,165 1,270,026 1,302,851 1,623,261
		4,589,016 2,893,287

		31 December 2022 $ 31 December 2021 $
Current Consideration due to Vale for Jaguar acquisition Up-front consideration due to Terrativa for Salobo West Royalty buy back Land possession Non-Current Land possession		- 2,400,840 - 933,534 1,432,088 1,827,074
		1,432,088 5,161,448
		183,926 1,325,267
		183,926 1,325,267

CENTAURUS METALS LIMITED ANNUAL REPORT

CENTAURUS METALS ANNUAL REPORT 2022

Note 20. Leases

The Group leases motor vehicles, offices and warehouse facilities. The leases are typically for a period of 1 to 5 years. During the year the Group exercised its option to extend the Corporate head office lease for a further 2 years. In addition a project office lease was entered into for a 21 month period. In Brazil a new office lease was entered into in Belo Horizonte for a period of 2.5 years. New leases were entered into for motor vehicles, office and warehouse space for the Jaguar project. A right of use asset and lease liability have been recognised as a result of these leases. The Group has applied the exemptions available under AASB 16 for short term leases and leases of low value.

	31 December 2022 $ 31 December 2021 $
Current Non-Current Lease payments are payable as follows	540,419 86,576 488,512 29,334
	1,028,931 115,910

	31 December 2022 $ 31 December 2021 $
Less than one year Between one to three years	540,419 86,576 488,512 29,334
	1,028,931 115,910

Amounts Recognised in Profit or Loss

	31 December	31 December
	2022	2021
	$	$
Interest on lease liabilities	33,388	7,901
Expenses relating to short-term leases	243,837	297,124
Expenses relating to leases of low-value assets, excluding short term leases
of low value assets	7,901	41,106

Note 21. Capital and Reserves

	2022 Number of Shares 2021 Number of Shares
On issue at beginning of period Issue of ordinary shares for placement at $1.1600 per share Issue of ordinary shares as a part of placement fee at $1.1600 per share Issue of ordinary shares on exercise of unlisted options at $0.2250 per share Issue of ordinary shares on exercise of unlisted options at $0.3780 per share Issue of ordinary shares on exercise of unlisted options at $0.1800 per share Issue of ordinary shares for Salobo West royalty buy back at $0.6108 per share Issue of ordinary shares on exercise of unlisted options at $0.21 per share Issue of ordinary shares on exercise of listed options at $0.18 per share On issue at the end of the period – Fully paid	358,291,616 325,857,160 64,655,172 - 409,483 - 2,233,335 - 1,400,000 - 116,667 - - 2,292,076 - 1,233,335 - 28,909,045
	427,106,273 358,291,616

2022 Number of
Shares
2021 Number
of Shares

On issue at beginning of period
Issue of ordinary shares for placement at $1.1600 per share
Issue of ordinary shares as a part of placement fee at $1.1600 per share
Issue of ordinary shares on exercise of unlisted options at $0.2250 per share
Issue of ordinary shares on exercise of unlisted options at $0.3780 per share
Issue of ordinary shares on exercise of unlisted options at $0.1800 per share
Issue of ordinary shares for Salobo West royalty buy back at $0.6108 per share
Issue of ordinary shares on exercise of unlisted options at $0.21 per share
Issue of ordinary shares on exercise of listed options at $0.18 per share
On issue at the end of the period – Fully paid

358,291,616
325,857,160
64,655,172
-
409,483
-
2,233,335
-
1,400,000
-
116,667
-
-
2,292,076
-
1,233,335
-
28,909,045

427,106,273
358,291,616

Ordinary Shares

Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the Company in proportion to the number of and amounts paid on the shares held. Every holder of ordinary shares present at a meeting in person or by proxy, is entitled to one vote, and upon a poll each share is entitled to one vote.

72 ANNUAL REPORT CENTAURUS METALS LIMITED

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Options

Information relating to options, including details of options issued, exercised or lapsed during the financial year and outstanding at the end of the financial year are set out in Note 9.

Listed Options

No listed options were exercised during the year (2021: 28,909,045). No listed options expired during the year (2021: 30,995).

	Weighted average exercise price 2022 Number of Listed Options Weighted average exercise price 2021 Number of Listed Options
On issue at beginning of period Options exercised - CTMOC Options expired - CTMOC On issue at the end of the period	- - $0.18 28,940,040 - - $0.18 (28,909,045) - - $0.18 (30,995)
	- - - -

Share-based Payments Reserve

The share-based payments reserve is used to recognise the fair value of options issued but not exercised.

Translation Reserve

The translation reserve comprises all foreign currency differences arising from the translation of the financial statements of foreign operations, as well as from the translation of liabilities that hedge the Group’s net investment in a foreign subsidiary.

Note 22. Contingent Liabilities

Guarantees

The Company has given guarantees in respect of bank security bonds amounting to $119,159 (2021: $33,648), secured by cash deposits lodged as security with the bank.

Jaguar Project Acquisition

The terms of the Jaguar Sale and Purchase Agreement with Vale give rise to the following contingent liabilities related to the Jaguar Project Acquisition.

US$5.0 million on first commercial production from the project payable to Vale;
a royalty of 0.55% on Net Operating Revenue for nickel sulphate or 0.75% on Net Operating Revenue generated from any future concentrate production from the project payable to Vale; and
a royalty of 1.8% on Net Operating Revenue generated from any future concentrate production from the project payable to BNDES.

No material losses are anticipated in respect of any of the above contingent liabilities. There are no other contingent liabilities that require disclosure.

Note 23. Capital Commitments

The Group has no capital commitments as at the year ended 31 December 2022 (2021: $nil).

CENTAURUS METALS LIMITED ANNUAL REPORT

CENTAURUS METALS ANNUAL REPORT 2022

Note 24. Related Parties

Key Management Personnel

KMP compensation is comprised of the following:

	31 December 2022 $ 31 December 2021 $
Short term employee-benefits (Salaries and STI Plan) Long term employee benefits Post–employment benefits Share-based payments expense	2,494,279 2,029,615 43,089 30,025 106,150 86,545 1,065,182 763,249
	3,708,700 2,909,434

Individual Directors and Executives Compensation Disclosures

Information regarding individual directors’ and executives’ compensation and equity instruments disclosures as required by Corporations Regulation 2M.3.03 is provided in the Remuneration Report section of the Directors’ Report.

Key Management Personnel and Director Transactions

A member of KMP, or their related parties, held positions in other entities that resulted in them having control or significant influence over the financial or operating policies of these entities.

This entity transacted with the Group in the reporting period. The terms and conditions of the transactions with key management personnel and their related parties were no more favourable than those available, or which might reasonably be expected to be available, on similar transactions to non-key management personnel related entities on an arm’s length basis.

The aggregate value of transactions and outstanding balances relating to key management personnel and entities over which they have control or significant influence were as follows:

Transaction Value	Balance Outstanding as at
Key Management Person Transaction 2022 $ 2021 $	31 Dec 2022 $ 31 Dec 2021 $
Mr D M Murcia(1) Legal fees 21,578 8,156 Total and current liabilities	6,015 -
	6,015 -

(1) Payable to MPH Lawyers, a firm in which Mr Murcia is a partner.

Transactions with Related Parties

Transactions between the parent company and its subsidiaries which are related parties of that company are eliminated on consolidation and are not disclosed in this note.

Note 25. Financial Instruments – Fair Values and Risk Management

Financial Risk Management

The Group has exposure to the following risks arising from the use of financial instruments:

Credit Risk
Liquidity Risk
Market Risk
Currency Risk.

This note presents information about the Group’s exposure to each of the above risks, their objectives, policies and processes for measuring and managing risk, and their management of capital. Further quantitative disclosures are included throughout these consolidated financial statements.

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(a) Risk Management Framework

The Board of Directors has overall responsibility for the establishment and oversight of the Group’s risk management framework.

Risk management policies are established to identify and analyse the risks faced by the Group, to set appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Group’s activities. The Group, through its training and management standards and procedures, aims to develop a disciplined and constructive control environment in which all employees understand their role and obligations and are able to identify and manage business risks.

(b) Credit Risk

Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations and arises principally from the Group’s other receivables and investment securities.

The Group’s exposure to credit risk is influenced mainly by the individual characteristics of each counterparty. However, management also considers the default risk of the industry and country in which counterparties operate, as these factors may have an influence on credit risk.

The carrying amount of the Group’s financial assets represents the maximum credit exposure. The Group’s maximum exposure to credit risk at the reporting date was:

	31 December 2022 $ 31 December 2021 $
Cash and cash equivalents(1) Other receivables	34,047,722 8,259,389 871,840 375,113
	34,919,562 8,634,502

(1) Cash and cash equivalents are held with bank and financial institution counterparties, which are rated BB- to AA based on Standard and Poor’s rating.

Other receivables also include refundable deposits and tax credits which include Brazilian federal VAT (PIS-Cofins). The recoverability of PIS-Cofins assets is dependent upon the Group generating a federal company tax liability, which may be offset against the Groups PIS-Cofins assets. As at 31 December 2022, the PIS-Cofins tax asset has been fully impaired as taxable profits in the ordinary course of business are not considered probable though one-off taxable profits may be generated on specific transactions. The Group’s maximum exposure to credit risk for other receivables at the reporting date by geographic region was:

	Carrying Amount
	31 December 2022 $ 31 December 2021 $
Australia Brazil	594,428 299,700 277,412 75,413
	871,840 375,113

These balances are net of provision for impairment (refer to Note 15).

Liquidity Risk

Liquidity risk is the risk that the Group will encounter difficulty in meeting the obligations associated with the financial liabilities that are settled by delivering cash or another financial asset.

The Group’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Group’s reputation.

As at 31 December 2022, the Group has current trade and other payables of $4,589,016 (31 December 2021: $2,893,287), Current Financial Liabilities of $1,432,088 (31 December 2021: $5,161,448), current lease liabilities of $540,419 (31 December 2021: $86,576), non current lease liabilities of $488,512 (31 December 2021: $29,334) and Non-Current Financial Liabilities of $183,926 (31 December 2021: $1,325,267). The Group believes it will have sufficient cash resources to meet its financial liabilities when due.

The following table shows the contractual maturities of financial liabilities, excluding the impact of netting agreements. It is not expected that the cash flows included in the maturity analysis could occur significantly earlier, or at significantly different amounts.

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CENTAURUS METALS ANNUAL REPORT 2022

Financial liabilities	Carrying amount Contractual cash flows 6 mths or less 6-12 mths 1-2 years 2-5 years
31 December 2022 Trade and other payables Financial liabilities Lease liabilities 31 December 2021 Trade and other payables Financial liabilities Lease liabilities	4,589,016 4,589,016 4,589,016 - - - 1,616,014 1,672,354 705,040 769,903 197,411 - 1,028,932 1,137,312 320,367 288,621 274,440 253,884
	7,233,962 7,398,682 5,614,423 1,058,524 471,851 253,884
	2,893,287 2,893,287 2,893,287 - - - 6,486,715 6,710,158 4,088,863 500,000 2,121,295 - 115,910 97,163 65,582 31,581 - - 9,495,912 9,700,608 7,047,732 531,581 2,121,295 -

Market Risk

Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the Group’s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising returns.

Currency Risk

The Group is exposed to currency risk on purchases that are denominated in currency other than the respective functional currencies of the Group entities, primarily the Australian dollar (AUD) and Brazilian Real (BRL). The currencies in which these transactions are primarily denominated are AUD and BRL.

The Group’s investments in its Brazilian subsidiaries are denominated in AUD and are not hedged as those currency positions are considered to be long term in nature.

Interest Rate Risk Profile

At the reporting date the interest rate profile of the Group’s interest-bearing financial instruments was:

	31 December 2022 $ 31 December 2021 $
Fixed rate instruments Financial assets Variable rate instruments Financial assets	20,000,000 - 13,287,309 8,251,513
	33,287,309 8,251,513

Fair Value Sensitivity Analysis for Fixed Rate Instruments

The Group does not account for any fixed rate financial assets at fair value through profit or loss. Therefore, a change in interest rates at the reporting date would not affect profit or loss or equity.

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Cash Flow Sensitivity Analysis for Variable Rate Instruments

A change of 300 basis points in interest rates at the reporting date would have increased/(decreased) equity and profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular foreign currency rates, remain constant. The analysis for 2021 was 100 basis points.

	Profit or Loss Equity
	Increase Decrease Increase Decrease
31 December 2022 Variable rate instruments Cash flow sensitivity (net) 31 December 2021 Variable rate instruments Cash flow sensitivity (net)	157,200 (157,200) - -
	157,200 (157,200) - -
	23,207 (23,207) - -
	23,207 (23,207) - -

Capital Management

The objectives for managing capital are to safeguard the Group’s ability to continue as a going concern and to provide funding for the Group’s planned exploration activities. Centaurus Metals Limited is an exploration company and is dependent on its ability to raise capital from the issue of new shares and its ability to realise value from its exploration and evaluation assets. The Board is responsible for capital management. This involves the use of cash flow forecasts to determine future capital management requirements.

There were no changes in the Group’s approach to capital management during the period. Neither the Company nor any of its subsidiaries are subject to externally imposed capital requirements.

Note 26. Group Entities

	Country of	Ownership interest	Ownership interest
	Incorporation	2022	2021
Parent Entity
Centaurus Metals Limited
Subsidiaries
Centaurus Resources Pty Ltd	Australia	100%	100%
San Greal Resources Pty Ltd	Australia	100%	100%
Itapitanga Holdings Pty Ltd	Australia	100%	100%
Centaurus Brasil Mineração Ltda	Brazil	100%	100%
Centaurus Pesquisa Mineral Ltda	Brazil	100%	100%
Centaurus Gerenciamento Ltda	Brazil	100%	100%
Centaurus Niquel Ltda	Brazil	100%	100%
Itapitanga Mineração Ltda	Brazil	100%	100%

Note 27. Subsequent Events

Other than outlined above, there has not arisen, in the interval between the end of the financial year and the date of this report an item, transaction or event of a material and unusual nature likely, in the opinion of the directors of the Company, to affect significantly the operations of the Group, the results of those operations, or the state of affairs of the Group, in future financial years.

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CENTAURUS METALS ANNUAL REPORT 2022

Note 28. Remuneration of Auditors

	31 December 2022 $ 31 December 2021 $
Audit Services Auditors of the Company Audit and review of financial reports 60,000 58,861 Services other than statutory audit Taxation compliance services 7,576 6,968 Other consulting services 10,590 - 18,166 6,986 Note 29. Parent Entity Disclosures As at, and throughout, the financial year ended 31 December 2022 the parent entity of the Group was Centaurus Metals Limited.
	60,000 58,861
	7,576 6,968 10,590 -
	18,166 6,986
	31 December 2022 $ 31 December 2021 $
Results of the Parent Entity Loss for the period(1) (41,438,269) (16,844,975) Total comprehensive loss for the period (41,438,269) (16,844,975) (1) During the year ended 31 December 2022 the parent entity provided for an impairment of $31,000,000 (2021: $11,000,000) (relating to loans to subsidiaries based on an assessment of recoverability).	(41,438,269) (16,844,975) (41,438,269) (16,844,975)
	31 December 2022 $ 31 December 2021 $
Financial Position of the Parent Entity at Year End Current assets Non-current assets(1) Total assets Current liabilities Non-current liabilities Total liabilities Net assets Share capital Reserves Accumulated losses Total equity	26,297,277 5,866,948 26,280,746 13,581,590
	52,578,023 19,448,538
	3,157,749 2,502,355 80,413 223,691
	3,238,162 2,726,046
	49,339,861 16,722,492
	236,289,294 162,962,306 2,267,253 1,538,603 (189,216,686) (147,778,417)
	49,339,861 16,722,492

As at, and throughout, the financial year ended 31 December 2022 the parent entity of the Group was Centaurus Metals Limited.

(1) During the year ended 31 December 2022 the parent entity provided for an impairment of $31,000,000 (2021: $11,000,000) (relating to loans to subsidiaries based on an assessment of recoverability).

(1) Included within non-current assets are investments in and loans to subsidiaries net of provision for impairment. Ultimate recoupment is dependent on successful development and commercial exploitation or, alternatively, sale of the respective project areas.

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Directors’ Declaration

In the opinion of the directors of Centaurus Metals Limited (the “Company”):
(a) The consolidated financial statements and notes, and the Remuneration Report in the Directors’ Report are in accordance with the Corporations Act 2001, including:
- (i) Giving a true and fair view of the Group’s financial position as at 31 December 2022 and of its performance, for the financial year ended on that date; and
- (ii) Complying with Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations Regulations 2001;
(b) There are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable; and
The directors have been given the declarations required by section 295A of the Corporations Act 2001 from the Managing Director and the Chief Financial Officer for the financial year ended 31 December 2022.
The financial report also complies with International Financial Reporting Standards as disclosed in Note 2.

Signed in accordance with a resolution of the directors.

______ D P Gordon Managing Director Perth 30 March 2023

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AUSTRALIA

Level 2, 1 Ord Street West Perth, WA 6005 PO Box 975, West Perth, WA 6872 T: +61 8 6424 8420

BRAZIL

Edifício Century Tower Rua Maria Luiza Santiago, 200 Santa Lúcia, 17ª Andar - Sala 1703 Belo Horizonte - MG - CEP: 30360-740 BRAZIL T: +55 31 3194 7750

ACN 009 468 099

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www.centaurus.com.au

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CENTAURUS METALS LIMITED — Annual Report 2022

64715_rns_2023-04-23_40675d2d-8d8b-46c5-8c9b-27eead31f803.pdf

ANNUAL REPORT

Corporate Directory

DIRECTORS

BANKERS

Australia

Brazil

STOCK EXCHANGE LISTING

COMPANY SECRETARY

PRINCIPAL & REGISTERED OFFICE

Australia

SHARE REGISTRY

AUDITORS

Brazil

Contents

EXPLORATION & DEVELOPMENT

ENVIRONMENT, SOCIAL & GOVERNANCE (ESG)

CORPORATE

Chair’s Report

“

Didier Murcia

Focus for the Year Ahead

→Maintain aggressive drilling program

Nickel Market & Price

Environmental, Social & Governance

GHG EMISSIONS

PLANT NURSERY & REVEGETATION PROGRAM

WATER WELLS

CONSTRUCTION TRAINING PROGRAMS

COMMUNITY CONSULTATION

COMMUNITY SUPPORT – BRIDGE CONSTRUCTION

Strategy & Key Assets in Brazil

Jaguar Nickel Sulphide Project

UPDATED JORC MINERAL RESOURCE ESTIMATE

JAGUAR SELECTED AS A STRATEGIC MINERALS PROJECT

RESOURCE IN-FILL, STEP-OUT AND EXTENSIONAL DRILLING PROGRAM

TARGETS FOR ONGOING MINERAL RESOURCE GROWTH

DEFINITIVE FEASIBILITY STUDY (DFS), PROJECT DEVELOPMENT AND INFRASTRUCTURE INITIATIVES

APPOINTMENT OF AUSENCO AS LEAD ENGINEER

MINING

MINERALOGY

Global Project Average Sulphides

FLOTATION TESTWORK

PILOT PLANT

Phase 1

Phase 2 & 3

PROCESS PLANT ENGINEERING

INFRASTRUCTURE

Road Upgrades

Power Supply

Tailings Storage Facility Designs

New Site Core Shed

On Site Accommodation

Sterilisation Drilling of Major Infrastructure Areas

Key Appointments – Project Execution Team

OFF-TAKE DISCUSSIONS

PROJECT FINANCE

Greenfields Exploration Pipeline

SANTA INÊS PROJECT

TERRA ROXA PROJECT

CURIONÓPOLIS PROJECT

Jambreiro Iron Ore Project

APPOINTMENT OF NON-EXECUTIVE DIRECTOR

$75M INSTITUTIONAL SHARE PLACEMENT

CASH POSITION

Mineral Resources & Ore Reserves

TOTAL MINERAL RESOURCES & ORE RESERVES STATEMENT

MINERAL RESOURCES AND ORE RESERVES ANNUAL STATEMENT AND REVIEW

ESTIMATION GOVERNANCE STATEMENT

APPROVAL OF MINERAL RESOURCES AND ORE RESERVE STATEMENT

COMPETENT PERSON’S STATEMENT

Jaguar Nickel Project

Jambreiro Iron Ore Project

Tenement List

BRAZILIAN TENEMENTS

AUSTRALIAN TENEMENTS

Additional Shareholder Information

SUBSTANTIAL SHAREHOLDERS

CENTAURUS METALS LIMITED Annual Report 2022