A: The mining plant first learned about HPY Sorting Technology at an industry exchange meeting in March 2018. At the time, the ore sorting technology had not yet been applied to lead and zinc ore within China. We believed that this technology could be successfully applied to lead-zinc ore and hoped that HPY Technology would be willing to collaborate with us on this project.

Due to the 2 million square meters of accumulated waste rock in our mine tailings pond, which was set to expire in 2025, we were under a great deal of pressure to clean up the waste rock residue as soon as possible. As a result, we decided to utilize the first ore sorting machine for lead-zinc ore in our Fankou lead-zinc mine. After six months of technical research, HPY Technology completed the assembly of the testing machine in September 2018 and completed on-site commissioning and algorithm tuning in early 2019. The data indexes met the requirements of the construction material plant, marking the success of the development of the first domestic lead-zinc ore ore sorting machine. This achievement represents a revolutionary breakthrough in the lead-zinc ore beneficiation process and challenges our traditional concepts of underground mining.

In order to control the grade of raw ore and reduce waste rock, we previously had to rely on small-scale blasting based on the size of the veins. However, with the use of the ore sorting machine, we are now able to utilize large-scale blasting to reduce the cost of raw ore collection and simultaneously achieve pre-concentration and pre-rejection of the raw ore, improving the grinding grade. This significantly reduces the cost of grinding and the occupation of tailing pond capacity and allows the waste rock to be repurposed as construction material, generating economic value and maximizing the use of resources.

A: At the Fankou Lead-Zinc Mine Construction Material Plant, which has a 500 ton per day waste rock processing line, HPY Technology's XRT ore sorting machine is able to recover more than 1,500 tons of lead and zinc resources per year from the waste rock. This has resulted in a 10.3 million USD increase in annual income for the mine. Due to the impressive results of the tailings processing, we decided to purchase HPY Technology's ore sorting machine for both raw ore sorting and tailings processing.

In 2020, the Fankou Lead-Zinc Mine's new ore processing plant added a roughing and pre-rejection process to its beneficiation production line and purchased four HPY Technology's XRT ore sorting machines in April. In September, the construction material plant expanded and added three more ore sorting machines to their operations.

This expansion brought the total number of ore sorting machines at the Fankou Lead-Zinc Mine to seven. Currently, the new ore dressing plant has four machines for roughing raw ore, and the Fankou Construction Material Plant has three machines for processing waste rock. The waste rock that is selected from the ore processing plant is transported directly to the Fankou Construction Material Plant for further sorting and refining, with the remaining waste rock being used as construction materials. These machines have brought significant economic and social benefits to the company.

A: We believe that XRT ore sorting machines are a revolutionary breakthrough in the beneficiation process, as they allow for automatic pre-concentration and pre-rejection, particularly for low-grade ore. This technology improves the ore enrichment ratio and allows previously low-value mine resources to be utilized. In theory, we think that XRT ore sorting machines could be applied to all mining enterprises. While there are about 90,000 mining enterprises in China, the development of XRT ore sorting machines is still in its early stages, with less than 1% of mining enterprises currently using this technology. This leaves significant room for growth. HPY Technology's machines are also more affordable compared to international competitors, so we believe that they will not only be successful in China, but also have the potential to enter the global market. Many of Fankou Lead-Zinc Mine's Chinese counterparts have learned about the economic benefits achieved through the use of XRT ore sorting machines and have visited our company to learn more about these machines. With the increasing difficulty of mining and growing pressure on environmental and safety issues, mining enterprises will focus on digitalization, informatization, automation, and intelligence.

A: We are proud to be the first lead-zinc mine in China to use XRT ore sorting machines, and we have seen great results with the technology in our own operations. We believe that these machines can bring significant economic benefits to other companies, particularly those with low-grade ore deposits. China has vast reserves of lead and zinc ore, ranking second globally, but the grades of these deposits are generally low, with an average grade of 1.5% for lead and 2.5% for zinc. More than 90% of the reserves have a lead ore grade below 5.0%, and more than 85% have a zinc ore grade below 8.0%. We want to share this innovative technology with our peers in the industry and contribute to the progress of the mining sector.

A: Yes, China places a high emphasis on building sustainable mines, providing both policy and financial support in this regard. Sustainability in mining covers a wide range of aspects, including mining and safety practices, production efficiency, management, environmental protection, resource utilization, and the overall aim of building an "environment-friendly" industry chain. As global standards for solid waste treatment in mines become increasingly stringent, companies that fail to meet these standards risk being shut down or heavily penalized. HPY Technology can help mining companies effectively address these environmental concerns.

A: We are excited to see that Chinese companies like HPY Technology continue to introduce new products. We are impressed by their innovative capabilities, especially with the recent release of several new products. We have read about the product updates and have noticed significant progress compared to the machines we have previously purchased. Our current machines have a sorting grain size of +10mm-60mm, while the new products can handle grain sizes up to 5mm, which other international ore sorting machine manufacturers have not yet achieved. In comparison to the overall value created by the machines, we do not consider the cost of upgrading to be a concern.

The total investment in constructing our new mineral processing plant is around 300 million, and it has been designed with the use of XRT ore sorting machines in mind. We have also modified our old production line with HPY Technology's machines, as we believe the modification cost is worth it considering the benefits achieved.