PJSC PhosAgro : Report on Payments to Government for 2021

PhosAgro Group

Economic contribution and payments to governments Report for the year ended 31 December 2021

Contents

Introduction............................................................................................................................................	3
Basis for Preparation - Report on Payments to Governments for the Year ended 31 December
2021 .......................................................................................................................................................	3
Consolidated Overview ........................................................................................................................	8
Payments to governments on a project-by-project basis......................................................................	8
Taxes paid on a project-by-project basis ..............................................................................................	8
Payments made, broken down by level of government authority.........................................................	8
Contact Information ..............................................................................................................................	9

Introduction

As one of the world's leading producers of mineral fertilizers, PJSC PhosAgro and its subsidiaries ("PhosAgro Group" or "the Company") has up-to-date and relevant policies and ensures full compliance with applicable legislation. PhosAgro Group closely tracks legislative developments at the government and regulatory levels, and acts in a timely manner to prepare and submit all required reports and statements.

This report on PhosAgro Group's economic contribution and payments to governments (the "Report") is prepared in accordance with the rules enacted by Section 4.3A of the UK Financial Conduct Authority's (FCA) Disclosure and Transparency Rules, which require oil, gas, mining and logging companies that have securities listed on UK-regulated markets to annually and publicly disclose payments made to governments.

The Report provides information on payments made to government agencies in 2021 by PhosAgro Group that carry out the exploration, development and extraction of mineral raw materials (hereinafter referred to as "mining activities"). The Report provides information on payments made on a country-by-country and/or project-by-project basis. The Report does not include payments made by companies that are part of PhosAgro Group but that do not carry out mining activities.

JSC Apatit ("Apatit") is the only PhosAgro entity that is involved in exploration, prospecting, discovery, development and extraction activities. Hence, this Report provides an overview of the payments to government authorities in the Russian Federation made by Apatit for the year ended 31 December 2021.

This Report has been disclosed via an FCA-approved Regulatory Information Service, submitted to the National Storage Mechanism (https://data.fca.org.uk/#/nsm/nationalstoragemechanism), and is available for download on the Company's website at www.phosagro.com.

Basis for Preparation - Report on Payments to Governments for the Year ended 31 December 2021

Reporting entities

PhosAgro Group has more than twenty subsidiaries in the upstream and downstream mining, processing, distribution, logistics, and research and development segments.

However, only one PhosAgro subsidiary, Apatit, is involved in mining activities. This Report provides an overview of the payments to government authorities in the Russian Federation made by Apatit for the year ended 31 December 2021.

Activities

Apatit holds five mining and two exploration licences allowing it to conduct exploration and mining activities and two licenses for geologic study, exploration and mining activities at two deposits. The Kirovsk branch of Apatit extracts apatite-nepheline ore that is then transferred to the beneficiation plant for processing into phosphate rock and nepheline concentrate, which is primarily used for processing at Cherepovets, Balakovo and Volkhov branches of Apatit.

Payments to governments made by Apatit arising from activities involving the exploration, discovery, development and extraction of apatite-nepheline ore and its beneficiation are disclosed in this Report.

The report excludes payments related to the further processing of phosphate rock into mineral fertilizers at the production facilities of the Balakovo and Volkhov branches of Apatit.

However, as a practical matter, initial processing activities are integral to the extractive activity resulting in payment liabilities being determined on a basis that includes both the extraction and initial processing of the apatite-nepheline ore. These initial processing activities may be inseparable from the relevant activities for the purposes of reporting and were included in the Report.

Government

Government means any national, regional or local authority of a country, including a department or agency. All payments by Apatit have been made to federal, regional and local governments of the Russian Federation. Payments to any state-owned enterprises, such as utility fees, water charges, and electricity charges were excluded from this Report (please see the "Payments" section). In this Report, payments are broken down by allocation to federal, regional, and local authorities, and include the name of the corresponding government agency.

Project

A project is an operational activity governed by a single contract, licence, lease, concession or similar legal agreement, and forms the basis for payment liabilities with a government.

Upstream operations are conducted by Apatit, a PhosAgro subsidiary, which mines apatite- nepheline ore from the group of Khibiny mineral deposits in accordance with 5 (five) mining and exploration licences and two licences for geological study, exploration and mining activities (please see the Table No. 1 below).

The Company realises that licence-by-licence disclosure is the preferred approach for the purposes of the Report. However, where multiple licences relate to a single mine, these have been treated as a single project due to:

• the geological characteristics of the extracting activities;
• the geographical proximity of the deposits;
• the chemical identity of the mined minerals;
• the particular nature of the ore extraction.

For the purposes of the Report, the Company uses the mine as the project definition.

Table No. 1

No.	Mine		Mineral deposit	Licence
		Exploration and mining activities
1	Kirovsky mine		Kukisvumchorr deposit	Exploration and mining
	Yukspor deposit	activities
			Apatitovy Cirque and
2	Rasvumchorrskiy mine		reserves located below	Exploration and mining
	the Rasvumchorr	activities
			Plateau deposit mine
3			The Plateau	Exploration and mining
		Rasvumchorr deposit	activities
4			Koashva deposit	Exploration and mining
		activities
5	Vostochniy mine		Njorkpahk deposit	Exploration and mining
	activities
6			Iyolitovy otrog deposit	Geological study, exploration
		and mining activities
7			Plot Plateau	Geological study, exploration
		and mining activities

Payments

Payments included in the Report are amounts paid, whether in money or in kind, for relevant activities. The Report includes cash payments actually made during the reporting period (the year ended 31 December 2021).

The Report excludes the following payments:

• administrative government fees, including utility fees, water charges and electricity charges paid to state-owned companies;
• environmental payments, including water pollution, solid waste pollution, and air pollution payments;
• charity payments or any other voluntary payments (made either in cash or in kind) that do not directly follow from a licence agreement;
• any other obligatory payments that are not directly linked to mining activity;
• interest or/and penalties on late tax payments or on underpaid tax;
• any refunds received by Apatit.