ArcWest Exploration Inc. - Management Reports 2022

ARCWEST EXPLORATION INC. Management Discussion and Analysis For the year ended December 31, 2021

This management discussion and analysis of financial position and results of operations (“MD&A”) is prepared as at April 29, 2022 and should be read in conjunction with the audited financial statements and related notes thereto of ArcWest Exploration Inc. (the “Company” or “ArcWest”) for the year ended December 31, 2021 which have been prepared in accordance with International Financial Reporting Standards (“IFRS”) issued by the International Accounting Standards Board and Interpretations of the International Financial Reporting Interpretations Committee. All dollar amounts included therein and in the following MD&A are expressed in Canadian dollars except where noted.

In this discussion, unless the context requires otherwise, references to “we” or “our” are references to ArcWest Exploration Inc.

Forward Looking Statements

This Management’s Discussion and Analysis (“MD&A”) contains certain statements, other than statements of historical fact that are forward-looking statements which reflect the current view of the Company with respect to future events including corporate developments, financial performance and general economic conditions which may affect the Company. The forward-looking statements in this MD&A include, but are not limited to: the exploration status of our Oweegee Dome, Todd Creek, Oxide Peak, Eagle, Rip, Teeta Creek, NVI, Huckleberry and Sparrowhawk properties; related commitments and timelines for development of these properties; and future funding requirements for the Company. Forward-looking statements are included, but are not limited to, those statements set out in this MD&A under Description of Business and Overall Performance, Future Plans and Outlook, Future Changes in Accounting Policies and Risks and Uncertainties.

We have based these forward-looking statements largely on our current expectations, projections and assumptions made based on our experience, perception of historical trends, the current business and financial environment. Key assumptions upon which the forward-looking statements are based include the following:

a) If required, the Company will be able to secure additional financial resources; b) Key personnel will continue their positions with the Company;
c) We will be able to enter into partnerships and/or complete exploration programs on our properties.

Forward-looking statements should not be read as a guarantee of future performance or results and will not necessarily be accurate indications of the times at, or by, which such performance or results will be achieved. Forward-looking statements are based on information available at the time those statements are made and/or management’s good faith belief as of that time with respect to future events and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. Risks that could cause actual results to differ from current expectations include: our ability to source new projects and properties; our ability to attract partners to conduct advanced exploration on our property portfolio; general economic and financial market conditions; inability to raise capital; and retaining key directors and management.

Except as may be required by applicable law or stock exchange regulation, we undertake no obligation to update publicly or release any revisions to these forward-looking statements to reflect events or circumstances after the date of this document or to reflect the occurrence of unanticipated events. Accordingly, readers should not place undue reliance on forward-looking statements. If we do update one or more forward-looking statements, no inference should be drawn that additional updates will be made with respect to those or other forward-looking statements. Additional information relating to our Company is available by accessing the SEDAR website at www.sedar.com.

Description of Business

ArcWest Exploration Inc. (“ArcWest” or “the Company”), was incorporated under the Business Corporations Act (British Columbia) on December 23, 2010, and is a corporation listed publicly on the TSX Venture Exchange (“TSXV”). On February 28, 2019, the Company changed its name to ArcWest Exploration Inc. and is now trading on the TSX Venture Exchange under the new stock symbol “AWX”.

The registered and records office of the Company is located at Suite 1700, Park Place, 666 Burrard Street, Vancouver, British Columbia, V6C 2X8. The head office of the Company is located at 1000-355 Burrard Street, Vancouver, BC V6C 2G8.

ArcWest is engaged in mineral exploration utilizing a “prospect generator” business model initially focused on securing exploration properties of exceptional merit in the highly prospective Golden Triangle region of British Columbia and other proven mining districts throughout BC. ArcWest plans to provide geological expertise and funding to efficiently build value in these properties and use joint ventures to build resources through the more expensive drilling stages.

COVID-19

In March 2020 the World Health Organization declared coronavirus COVID-19 a global pandemic. This contagious disease outbreak, which has continued to spread, and any related adverse public health developments, has adversely affected workforces, economies, and financial markets globally, potentially leading to an economic downturn. The impact on the Company is not currently determinable but management continues to monitor the situation.

In response to the COVID-19 pandemic, ArcWest has adopted safe operations protocols (SGDS HIVE, 2020) made available by the British Columbia Association for Mineral Exploration.

Activities for the year ended December 31, 2021

On May 21, 2021, the Company announced the appointments of Michael Smyth and Colin O’Leary to the Company’s board of directors and the resignation of John Meekison from the board of directors.
On July 8, 2021, Peter Lekich was appointed to the board of directors at the Company’s Annual General Meeting.
On July 21, 2021, the Company announced that Sanatana Resources signed an earn-in agreement for the Oweegee Dome porphyry copper-gold project, located in BC’s Golden Triangle. Sanatana can earn an initial 60% interest ("First Option") in the Oweegee Dome project by funding, over a four-year period, cumulative exploration expenditures of $6,600,000 and by making staged cash and share payments totaling $500,000 and 2,000,000 shares, respectively.

Sanatana may achieve the First Option by fulfilling the following: (a) paying to ArcWest $500,000 and 2,000,000 common shares as follows: (i) $12,500 on signing of the letter agreement and an additional $12,500 on signing of the definitive agreement; (ii) $25,000 and 300,000 common shares on or before December 31, 2021; (iii) $50,000 and 400,000 common shares on or before December 31, 2022; (iv) $100,000 and 600,000 common shares on or before December 31, 2023; and (v) $300,000 and 700,000 common shares on or before December 31, 2024; (b) incurring $6,600,000 in exploration expenditures on the property as follows: (i) not less than $600,000 on or before November 31, 2021; (ii) cumulative exploration expenditures of not less than $1,600,000 on or before December 31, 2022, including a minimum of 1,000 metres of drilling; (iii) cumulative exploration expenditures of not less than $3,600,000 on or before December 31, 2023, including a minimum of 2,000 metres of additional drilling; (iv) cumulative exploration expenditures of not less than $6,600,000 on or before December 31, 2024, including a minimum of 3,000 metres of additional drilling. On April 22, 2022 Sanatana fulfilled its year one obligations as per the Oweegee Dome earn-in agreement (for further details see below).

Upon completion of the First Option and receipt of the Initial Interest Notice from Sanatana, Sanatana will have a 60-day period to elect to earn an additional 20% interest, for an aggregate 80% interest ("Second Option") or form a Joint Venture (“JV”). The Second Option can be attained by completing and delivering to ArcWest a Feasibility Study on or before December 31st, 2027. In order to keep the Second Option in good standing, Sanatana will be obligated to pay to ArcWest $150,000 on each anniversary of the delivery of the Initial Interest Notice until such time that the Feasibility Study has been completed and delivered to ArcWest. Following the exercise or lapse of the Second Option, the parties will form a JV to hold and operate the properties, and each party will proportionately fund or dilute. In the event a production decision is made by the Joint Venture to place the property into production, Sanatana shall arrange project financing for the Joint Venture, the repayment of which shall be made out of cash flows from the property. Should Sanatana

or ArcWest’s interest be diluted to less than 10%, then that interest will convert to a 2% Net Smelter Return Royalty, one percent of which may be purchased by the other party for $5,000,000 at any time.

On July 29, 2021, the Company announced that it had completed the sale of its Huckleberry property to Huckleberry Mines Ltd. (“Huckleberry”), a wholly owned subsidiary of Imperial Metals Corporation. Under the terms of transaction set out in the agreement, Huckleberry will acquire 100% of the Property, will make a cash payment of $50,000 (paid) and ArcWest will retain a 1.0% net smelter return royalty (“NSR”) with no buydown provisions.
On August 5, 2021, the Company announced that partner Wedgemount Resources (“Wedgemount”) reported initial assay results from its 2021 exploration program at the Company’s road accessible Eagle copper-gold project, located in the highly prospective Quesnel trough copper-gold porphyry belt of central British Columbia. Sampling was focused at the three main zones (Nighthawk, Vector and Mid) to verify mineralization style and grade and to expand known mineralization footprints as well as other high priority targets that display coincident soil geochemical and ground and/or airborne geophysical anomalism. Of 51 rock samples collected, a total of 43 returned copper concentrations in excess of 1,000 ppm (0.1% copper) and 12 samples returned results ranging from 1.26% to 9.86% copper.

Anomalous gold and silver results were also reported and averaged 0.292 g/t gold and 8.23 g/t silver for copper results above 1,000 ppm and 0.725 g/t gold and 20.0 g/t silver for copper concentrations greater than 1%. The best copper-gold-silver result was sample D702202 which returned 9.86% copper, 2.5 g/t gold and 77.7 g/t silver. This sample was collected from a 20 by 20 metre gossanous outcrop at the Nighthawk showing. Multiple samples collected over an 800 m2 area in the vicinity of the Nighthawk showing returned strong copper-gold values; these include sample D702202 (9.86% copper, 2.5 g/t gold and 77.7 g/t silver), sample D702210 (7.95 % copper and 1.59 g/t gold) and D702206 (4.42 % copper and 1.30 g/t gold).

On September 20, 2021, the Company announced assay results for the initial drill test of the Teeta Creek porphyry copper-molybdenum-gold-silver (“Cu-Mo-Au-Ag”) project located on northern Vancouver Island B.C. and completed by Teck Resources Limited (“Teck”). Following the release of final reports on the program, Teck has relinquished its options to earn an interest in the Teeta Creek and NVI projects. ArcWest is now considering new funding partners in order to advance the Teeta Creek and NVI projects. ArcWest’s recommended targets for porphyry Cu-Mo-Au and epithermal Au-Ag on the Teeta Creek project remain to be drill tested.

For more details on the drill holes and assay results, please refer to the Company’s press releases dated September 20, 2021, which can be found on https://www.sedar.com and on the Company’s website at https://arcwestexploration.com/.

On September 21, 2021, the Company announced a discovery of a new copper-bearing zone at the Oweegee Dome porphyry copper-gold (Cu-Au) project located within British Columbia’s renowned Golden Triangle. The 2021 exploration program included geological mapping, prospecting and rock sampling as well as airborne and ground geophysics. Activities primarily focused on the southern portion of the property around the highly gossanous Delta target area which hosts at least three known porphyry Cu-Au occurrences including Delta Ridge, Molloy, and Snowpatch Creek. The Molloy zone was the highest priority area for follow up in order to validate eleven samples collected in 1997 which averaged 0.53% Cu, 1.09 g/t Au and 4.8 g/t Ag. Mapping and re-sampling in August 2021 of the Molloy showing indicates Cu-Au mineralization is hosted within quartz-chalcopyrite centreline veins and stockwork cutting fine grained equigranular microdiorite. The ground geophysical program covered all three Cu-Au occurrences and consisted of 9.7 line km over 6 roughly north-south lines. Airborne magnetic and radiometric geophysical surveying was completed over a 52.8 square kilometre area on the northern portion of the Oweegee property and totaled 588 line km. Geological mapping, rock and soil sample assays and geophysical results are pending and will be used to delineate targets for a 2022 drill campaign.

For more details on the highlights of the Oweegee Dome 2021 exploration program, please refer to the Company’s press releases dated September 21, 2021, which can be found on https://www.sedar.com and on the Company’s website at https://arcwestexploration.com/.

On October 14, 2021, the Company granted 975,000 stock options to three recently elected directors. Each option entitles the holder to purchase one common share. 225,000 of the options are exercisable at a price of

$0.105 per option and 750,000 of the options are exercisable at a price of $0.15 per option. The options are valid for a period of five years from issuance and will vest in six equal tranches over fifteen months.

On December 15, 2021 the Company announced that partner Wedgemount reported results from its 2021 induced polarization (“IP”) geophysical survey at ArcWest’s 100% owned, road accessible Eagle coppergold project. The IP survey included 20.5 line kilometres covering an area of approximately 8.75 km[2] ; focused on the 3.5 kilometre long Nighthawk-Mid-Vector copper-gold mineralized trend. A new coincident high-chargeability and high-resistivity anomaly was discovered east of the historic Vector Zone, which is coincident with anomalous copper in soils (up to 3100 ppm copper from historical surveys) – this area represents a new exploration target located nearly 500 metres east of historical drilling. A second zone of high-chargeability was identified between the Mid and Nighthawk zones with a coincident magnetic low, and could represent an untested porphyry target. A southeastern IP line, which tested the core of the Nighthawk Zone, defined an intense chargeability anomaly that increases in size with depth. From the IP survey it’s now apparent that historic drilling at Nighthawk (DDH EA-91-06 which returned up to 27.3 metres of 0.87% copper and 0.32 grams per tonne gold) tested only a narrow near-surface chargeability anomaly.

A mandatory minimum exploration expenditure of $250,000 was required at Eagle before December 31[st] , 2021, including a minimum 1,000 m of drilling. Wedgemount and ArcWest have agreed to extend this deadline to December 31st, 2022. In return, Wedgemount will pay to ArcWest on signing of the amending agreement 400,000 shares and $25,000; these payments will be credited towards future payments due to ArcWest as per the Eagle earn-in and joint venture agreement (see AWX news release dated October 5, 2020). Furthermore, Wedgemount’s 1,000 metre minimum drill program, which is now scheduled for 2022, will become a mandatory minimum work commitment. If Wedgemount does not complete a minimum of 1,000 metres of drilling on the project by December 31[st] , 2022, it will pay to ArcWest $250,000.

On December 16, 2021, the Company announced that partner TDG announced the completion of a 1,000 metre drill program at the Drybrough target, in the southern part of the ArcWest’s 100% owned Oxide Peak Project in the Toodoggone District, northern B.C. TDG was required to complete 1,000 metres of diamond drilling before December 31[st] , 2021 under its earn-in agreement for Oxide Peak (see ArcWest news release December 23, 2019). Assays for the program are not yet available.
On January 20, 2022, the Company provided an update for partner funded exploration of its Todd Creek copper-gold (“Cu-Au”) project. Exploration conducted on the Todd Creek property in 2021 by partner P2 Gold Inc. (“P2”) included a large scale magnetotellurics (“MT”) geophysical survey and a geological mapping and sampling program. Following the release of final reports on the program, P2 has relinquished its option to earn an interest in the Todd Creek project. ArcWest is currently seeking a new partner for Todd Creek.
On April 21, 2022, the Company announced an extension to the Oweegee Dome earn-in agreement, providing Sanatana with an extension to the original Dec. 31[st] , 2021 deadline for an aggregate payment to ArcWest of $50,000 (of which $12,500 has been paid and a balance of $37,500 is owing) and 300,000 common shares of Sanatana. These payments are to be made to ArcWest promptly after approval by the TSX Venture Exchange (“Exchange”).
On April 22, 2022, the Company announced results of TDG’s 2020 and 2021 exploration programs at Oxide Peak, including the results of the Dec. 2021 drill program at the Drybrough target. Mapping, sampling (rock and soil) and geophysical surveys (magnetics and induced polarization) have delineated targets for porphyry Cu-Au mineralization at the undrilled Oxide Peak zone. TDG Gold plans to conduct a first phase drill test of porphyry Cu-Au targets at the Oxide Peak zone in 2022.
On April 26, 2022, the Company announced that Sanatana has fulfilled its year one obligations as per the Oweegee Dome earn-in agreement, including Exchange approval of the outstanding cash and share payment due to ArcWest. The outstanding payment of $37,500 and 300,000 common shares of Santana were paid to ArcWest.

Future Plans and Outlook

ArcWest's plan is to become a pre-eminent North American project generator with an initial focus on British Columbia and its highly prospective Golden Triangle and other highly prospective porphyry copper - gold belts in BC. ArcWest

believes its properties represent some of the most prospective targets available in BC and is in a position to deliver increased shareholder value by providing geological expertise and funding to advance current properties and acquire new projects.

Operations Review

ArcWest owns eight mineral exploration projects in British Columbia as follows.

Todd Creek

ArcWest’s 100% owned, 32,133-hectare Todd Creek project is located 30 km northeast of Stewart and 45 km southeast of the giant KSM-Iron Cap porphyry Cu-Au (Seabridge Gold) and Treaty Creek Au-Ag+/-Cu (Tudor) deposits in B.C.’s Golden Triangle. The project is also located 35 km southeast of Pretium’s Brucejack gold-silver mine (ArcWest’s and Pretium’s claims are contiguous) and is proximal to the Brucejack mine road. On November 9th, 2021, Newcrest Mining announced the acquisition of Pretium Resources and its Brucejack mine in a transaction valued at CAD $3.5 billion. Collectively, the KSM-Iron Cap (Seabridge Gold), Treaty Creek (Tudor Gold-Teuton ResourcesAmerican Creek Resources) and Brucejack (Pretium Resources/Newcrest Mining) projects contain an estimated 199 million oz gold, 790 million oz silver and 51 billion lbs copper (Roulston, 2021).

The Todd Creek project hosts a 12 km N-S, variably Cu-Au mineralized gossan on the west side of Todd Creek valley that is prospective for KSM-Iron Cap-like porphyry Cu-Au systems. Multiple underexplored VMS occurrences on the east side of Todd Creek valley are prospective for Eskay Creek-like precious and base metal enriched VMS systems. An epithermal Au-Ag-Cu system, the South Zone, is present at low elevations on the west side of the Todd Creek valley. South Zone is host to a non-43-101 compliant historic resource calculated by Noranda totaling 207,000 tonnes grading 5.48 g/t Au (Hemlo Gold Mines, 1988 Annual Report). The South Zone is open in multiple directions. It should be noted that the historical estimates by Noranda were made by a source believed to be reliable. However, the estimates have not yet been independently verified according to The Canadian Institute of Mining, Metallurgy and Petroleum standards. The resource estimate is presented for historical purposes only. Therefore, the Company is not treating the estimate as a National Instrument 43-101 defined resource, and the historical estimate should not be relied upon.

P2 Gold and ArcWest announced an earn-in and joint venture agreement for ArcWest’s Todd Creek project on July 9th, 2020. P2 Gold can earn an initial 51% interest ("First Option") in the Property by funding over a five-year period cumulative exploration expenditures of $15,000,000 and staged payments of $1,150,000. A minimum exploration expenditure of $500,000 was required before December 31, 2020, which includes a mandatory minimum of 1,000 metres of diamond drilling.

P2 Gold completed in 2020 a first phase drill program at Yellow Bowl zone (two drill holes totaling 802 metres) and the VMS zone (one drill hole totaling 225 metres). An airborne magnetics-radiometrics survey was also completed on the northwest portion of the project in addition to a satellite hyperspectral survey. The results of the 2020 Todd Creek exploration program are discussed in an ArcWest press release dated Jan. 20[th] , 2021.

In 2021, P2 Gold completed at a 21line km geophysical survey (magnetotellurics) and a phase one geological mapping and sampling program. In a Dec. 24[th] , 2021 press release, P2 Gold announced the relinquishment of its option to earn an interest in the project. ArcWest is currently seeking a new partner for Todd Creek.

Oweegee Dome

ArcWest’s 100% owned, 31,077-hectare Oweegee Dome porphyry Cu-Mo-Au project is located 45 km east of Seabridge Gold’s supergiant KSM-Iron Cap porphyry Cu-Au project and 40 km east of Tudor Gold’s Treaty Creek Au-Ag-Cu project. Oweegee Dome is also situated 34 km northeast of Pretium’s high grade Brucejack gold-silver mine. Newcrest Mining recently completed the acquisition of Pretium Resources and its Brucejack mine in a transaction valued at CAD $3.5 billion. Collectively, the KSM-Iron Cap (Seabridge Gold), Treaty Creek (Tudor GoldTeuton Resources-American Creek Resources) and Brucejack (Pretium Resources/Newcrest Mining) projects contain an estimated 199 million oz gold, 790 million oz silver and 51 billion lbs copper (Roulston, 2021). The Oweegee Dome project hosts multiple underexplored porphyry Cu-Au systems of significant size, including the large Delta and Skowill East gossans.

In October of 2018, ArcWest sold to Seabridge Gold a non-core portion of the Oweegee Dome project in return for $500,000 in portable assessment credits. These credits may be applied to reduce future assessment requirements by 30%.

Reconnaissance geological mapping, and sampling was conducted in August of 2019, the results of which are summarized in subsequent news releases. A total of $44,375.62 of assessment work was filed on the property.

On April 19, 2021, ArcWest announced the signing of a letter of intent with Sanatana Resources to negotiate an earnin and joint venture agreement on the Oweegee Dome project. Sanatana completed a review of Oweegee Dome drill core stored in Stewart in May 2021.

On July 21, 2021, the Company announced that Sanatana signed an earn-in agreement for the Oweegee Dome porphyry copper-gold project. In August 2021, geological mapping and sampling and an induced polarization geophysical survey commenced on the property.

On September 21, 2021, the Company announced the discovery of a new copper-bearing zone at the northern portion of Oweegee Dome. The new showing has been named the Tarn zone and geochemical results are pending. A helicopter-borne magnetic and radiometric survey was subsequently completed over the Tarn zone and the surrounding Skowill East area. The majority of the 2021 geological and geophysical work programs were focused on the southern portion of Oweegee Dome at the Delta target area which includes at least three known porphyry Cu-Au occurrences at Delta Ridge, Molloy, and Snowpatch Creek. Geological mapping confirmed the presence of porphyrystyle quartz stockwork veins hosted within microdiorite at the Molloy showing while copper bearing potassic altered diorite dykes were observed at Snowpatch Creek. Over 200 rock samples were submitted for multielement analysis; results are pending. The ground geophysical program consisted of a 3D IP survey across the three showings within the Delta target area and comprised 9.7 line km over 6 roughly north-south lines. The results are pending.

On April 21, 2022, the Company announced an amending agreement to the Oweegee Dome earn-in agreement, providing Sanatana with an extension to the Dec. 31[st] , 2021 deadline for an aggregate payment to ArcWest of $50,000 (of which $12,500 has been paid and a balance of $37,500 is owing) and 300,000 common shares of Sanatana. These payments are to be made to ArcWest promptly after approval by the TSX Venture Exchange (“Exchange”)

On April 26, 2022, the Company announced that Sanatana has fulfilled its year one obligations as per the Oweegee Dome earn-in agreement, including Exchange approval of the outstanding cash and share payment due to ArcWest. The outstanding payments of $37,500 and 300,000 common shares of Santana were paid to ArcWest.

Willoughby

The Willloughby project was sold to Strikepoint Gold in a property purchase agreement announced April 17th, 2019. ArcWest received $85,000 and 3,000,000 common shares of Strikepoint. ArcWest retains a 1.5% NSR on the project, which can be reduced to 1% for an additional cash payment of $1,000,000.

Oxide Peak

ArcWest’s 100% owned Oxide Peak project is situated in the northern part of the Toodoggone Au-Cu district. The region hosts extensive Early Jurassic porphyry Cu-Au and epithermal Au-silver (Au-Ag) mineralization including several past producing Au-Ag mines (Baker, Lawyers, Shasta) and the large Kemess South Au-Cu porphyry deposit. The southern half of the project is located 10 km east of Benchmark Metal’s Lawyer’s project. Historical production in the district exceeds 3.2 million ounces of Au and 360,000 tonnes of Cu.

The Oxide Peak property was expanded with additional staking in July 2019 detailed in a subsequent news release. The staking covered prospective ground dropped by Talisker Resources and contains widespread porphyry Cu-Au occurrences as well as strong Au in stream sediment anomalies (i.e., in excess of 10 g/t Au) that have yet to receive follow up exploration.

ArcWest announced an earn-in and joint venture agreement with Locrian Resources (now TDG Gold Corp.) for Oxide Peak on Dec. 23rd, 2019. TDG can earn an initial 60% interest ("First Option") in the Property by funding over a three-year period cumulative exploration expenditures of $2,400,000, and staged cash payments of $55,000. In addition, TDG will issue to ArcWest 5% of its outstanding shares 12 months from signing, or immediately prior to a going public transaction. A minimum exploration expenditure of $400,000 was required before December 31, 2020.

This exploration expenditure included, with technical support from ArcWest, a geological mapping/sampling and geophysical (induced polarization) program focused on the Oxide Peak porphyry copper-gold target at the north end of the property. The program was successful in delineating a porphyry Cu-Au target of significant size situated on the east flank of Oxide Peak. Results of the 2020 exploration program are discussed in ArcWest press release dated January 27, 2021. Cumulative exploration expenditures totaling $900,000, including a minimum of 1,000 metres of diamond drilling, are required before December 31, 2021.

ArcWest sourced a capital pool company (Kismet Resources) in order to assist TDG’s go-public transaction. The company (TDG Gold) completed a private placement on December 11, 2020, totaling $4,033,610. Upon completion of the placement, TDG Gold issued 30% of its shares to Talisker Resources as part of a property purchase agreement to procure Talisker’s past producing Baker-Shasta Mine. Baker-Shasta is adjacent to Benchmark Metals’ Lawyers project, which has attracted significant attention from the mineral exploration community and undergone significant appreciation in share price.

On December 16, 2021, the Company announced that partner TDG announced the completion of a 1,000 metre drill program at the Drybrough target, in the southern part of the ArcWest’s 100% owned Oxide Peak Project in the Toodoggone District, northern B.C. TDG was required to complete 1,000 metres of diamond drilling before December 31st, 2021 under its earn-in agreement for Oxide Peak (see ArcWest news release December 23, 2019). Assays for the program are not yet available.

On April 22, 2022, the Company announced results of TDG’s 2020 and 2021 exploration programs at Oxide Peak, including the results of the Dec. 2021 drill program at the Drybrough target. Mapping, sampling (rock and soil) and geophysical surveys (magnetics and induced polarization) have delineated targets for porphyry Cu-Au mineralization at the undrilled Oxide Peak zone. TDG plans to conduct a first phase drill test of porphyry Cu-Au targets at the Oxide Peak zone 2022.

Rip

The Rip Property is a copper molybdenum porphyry (“Cu-Mo±Au”) prospect located in the Skeena Arch approximately 60 km south of Houston, BC. The property is in a prospective part of the Skeena Arch, which includes the past producing Huckleberry, Silver Queen and Equity mines as well as projects with significant known mineral resources including Berg, Poplar and Seel/Ox.

The Rip project was expanded by staking in August 2020 in order to acquire a large area of polymetallic showings that may be genetically related to undiscovered underlying or adjacent porphyry Cu-Au systems. No work was performed on Rip in 2020. Discussions with multiple potential partners for the project are ongoing. Teck is exploring a porphyry Cu project in the immediate vicinity of Rip. Sun Summit Resources is exploring the nearby Buck project and announced the discovery of high-grade Au-silver mineralization in late 2020.

Fieldwork at Rip was completed in September 2021 and included validation sampling of the Rox showing and historical trenches at the Tets showing. Areas of historical chargeability and resistivity anomalies in the vicinity of the Rox target were also prospected and sampled. Sites for potential drilling camps were investigated to determine access and suitability. After reviewing results from sampling and mapping at the Rox and Tets showings, claims over the showings were allowed to lapse and the main Rip showing was kept in good standing.

Huckleberry

In January 2019, ArcWest staked 2,525 hectares on the northern boundary of Imperial Metals past producing Huckleberry Cu-Au-Mo mine located 85 km southwest of Houston BC. The staked mineral claim boundary is approximately 1.5 km from the Huckleberry East Zone open pit and contains two known porphyry-style Cu-Mo-Au showings.

Imperial Metals is actively exploring the past producing Huckleberry mine and surrounding area. A 2020 drill program completed by Imperial resulted in the discovery of significant porphyry Cu-Mo-Au mineralization beneath the East Zone pit.

On July 29, 2021, the Company announced that it had completed the sale of its Huckleberry property to Imperial Metals Corporation. Under the terms of transaction set out in the agreement, Huckleberry Mines will acquire 100%

of the Property, and has made a cash payment to ArcWest of CAD$50,000. ArcWest will retain a 1.0% net smelter return royalty (“NSR”) on the property with no buydown provisions.

Eagle

ArcWest’s road accessible Eagle porphyry Cu-Au project is located approximately 90 kilometres northwest of Fort St. James. The project is situated midway between several significant Cu-Au deposits. Centerra Gold’s Mt. Milligan mine is located approximately 50 kilometres to the east. The advanced stage Kwanika porphyry Cu-Au deposit and the neighbouring Stardust carbonate replacement Cu-Au deposit (NorthWest Copper Corp.) are located approximately 50 km to the northwest.

Reconnaissance geological mapping, and sampling was conducted in June of 2019, the results of which are summarized in subsequent news releases.

ArcWest announced an earn-in and joint venture agreement for Eagle with Wedgemount on October 5th, 2020. Wedgemount can earn an initial 60% interest ("First Option") in the Property by funding a total of $2,050,000 in exploration expenditures over a three-year period in addition to staged payments totaling $110,000 and 1,350,000 shares. A minimum exploration expenditure of $50,000 was required before December 31, 2020. Additional exploration expenditures totaling $250,000, including a minimum of 1,000 metres of diamond drilling, are required before December 31[st] , 2021.

With the support of ArcWest geologists, Wedgemount conducted a VTEM survey on the property in November 2020. The survey demonstrated that Cu-Au mineralized breccias on the property form readily identifiable geophysical anomalies. The survey identified similar geophysical anomalies throughout the property that might represent additional, previously unrecognized porphyry Cu-Au centres. The results of this exploration program are discussed in an ArcWest press release dated January 27th, 2021. Wedgemount listed its shares on the Canadian Securities Exchange (CSE) on May 21, 2021. ArcWest was issued additional cash and shares in the company in the amount of $10,000 and 250,000 shares on listing.

On August 5, 2021, the Company announced that Wedgemount has reported initial assay results from its 2021 exploration program at the Eagle copper-gold project. Sampling was focussed at the three main zones (Nighthawk, Vector and Mid) to verify mineralization style and grade and to expand known mineralization footprints as well as other high priority targets that display coincident soil geochemical and ground and/or airborne geophysical anomalism. Of 51 rock samples collected, a total of 43 returned copper concentrations in excess of 1,000 ppm (0.1% copper) and 12 samples returned results ranging from 1.26% copper to the highest at 9.86% copper.

Anomalous copper grades are complimented with anomalous gold and silver values which averaged 0.292 g/t gold and 8.23 g/t silver for copper results in excess of 1,000 ppm and 0.725 g/t gold and 20.0 g/t silver for copper concentrations above 1%. The best copper-gold-silver result was sample D702202 which returned 9.86% copper, 2.5 g/t gold and 77.7 g/t silver. This sample was collected from a 20 by 20 metre gossanous outcrop at the Nighthawk showing. Multiple samples collected over an 800 m[2] area in the vicinity of the Nighthawk showing returned strong copper-gold values; these include sample D702202 (9.86% copper, 2.5 g/t gold and 77.7 g/t silver), sample D702210 (7.95 % copper and 1.59 g/t gold) and D702206 (4.42 % copper and 1.30 g/t gold).

On December 15, 2021 the Company announced that partner Wedgemount reported results from its 2021 induced polarization (“IP”) geophysical survey at ArcWest’s 100% owned, road accessible Eagle copper-gold project. The IP survey included 20.5 line kilometres covering an area of approximately 8.75 km²; focused on the 3.5 kilometre long Nighthawk-Mid-Vector copper-gold mineralized trend. A new coincident high-chargeability and high-resistivity anomaly was discovered east of the historic Vector Zone, which is coincident with anomalous copper in soils (up to 3100 ppm copper from historical surveys) – this area represents a new exploration target located nearly 500 metres east of historical drilling. A second zone of high-chargeability was identified between the Mid and Nighthawk zones with a coincident magnetic low, and could represent an untested porphyry target. A southeastern IP line, which tested the core of the Nighthawk Zone, defined an intense chargeability anomaly that increases in size with depth. From the IP survey it’s now apparent that historic drilling at Nighthawk (DDH EA-91-06 which returned up to 27.3 metres of 0.87 % copper and 0.32 grams per tonne gold) tested only a narrow near-surface chargeability anomaly.

A mandatory minimum exploration expenditure of $250,000 was required at Eagle before December 31st, 2021, including a minimum 1,000 m of drilling. Wedgemount and ArcWest have agreed to extend this deadline to December 31st, 2022. In return, Wedgemount will pay to ArcWest on signing of the amending agreement 400,000 shares and

$25,000; these payments will be credited towards future payments due to ArcWest as per the Eagle earn-in and joint venture agreement (see AWX news release dated October 5, 2020). Furthermore, Wedgemount’s 1,000 metre minimum drill program, which is now scheduled for 2022, will become a mandatory minimum work commitment.

Sparrowhawk

ArcWest’s road accessible, 9,913 hectare Sparrowhawk project surrounds Glencore Canada's past producing Bell and Granisle open pit mines and extends to the north where it is contiguous with Pacific Booker’s advanced stage Morrison project. Significant Cu-Au resources remain at Bell and Granisle open pits. At Bell alone, measured plus indicated resources total 257 million tonnes of 0.4% Cu and 0.2 g/t Au (Glencore Resources & Reserves as at 31 Dec 2021). The Sparrowhawk project is 11 kilometres southeast of the Morrison Cu deposit, which has a proven plus probable reserve of 224.25 Mt with an average grade of 0.33% Cu, 0.163 g/t Au and 0.004% Mo. In addition to containing multiple exploration targets for Bell-like porphyry Cu-Mo-Au sytems, the Sparrowhawk property also underlies proposed sites for tailings and waste management facilities in the event of a Bell-Granisle restart. Source: Glencore Resources and Reserves, as at 31 December, 2021, pg 21. URL - - https://www.glencore.com/.rest/api/v1/documents/fb0cafaa3ec10b90571130be41ba4270/2021 GLEN_Resources and-Reserves-report.pdf

The Sparrowhawk project was acquired from vendor Rolland Menard and by staking in January 2019. A total of $12,400.68 of assessment work was completed which included short wave infrared and petrographic study of rock samples from the project.

Reconnaissance geological mapping and sampling was conducted in June 2019, the results of which are summarized in a subsequent news release. A total of $35,801.79 worth of assessment work was filed on the property.

ArcWest completed a drone video survey of the property on behalf of a potential partner in October 2020. Discussions with multiple potential partners for the project are ongoing .

Fieldwork at Sparrowhawk was completed in September 2021 and included follow-up prospecting and the relogging, re-boxing and select re-sampling of historic core. Analytical results are pending.

Teeta Creek

ArcWest’s 100% owned Teeta Creek porphyry Cu-Au-Mo project is located 23 kilometres south of BHP-Billiton’s past producing Island Copper porphyry Cu-Mo-Au mine, and approximately 40 km south of NorthIsle Copper and Gold Inc.’s advanced stage Hushamu porphyry Cu-Au project. Historical drilling on the project intersected significant Cu mineralization in multiple holes.

Reconnaissance geological mapping and sampling was conducted in May 2019, the results of which are summarized in a subsequent news release.

ArcWest announced an earn-in and joint venture agreement with Teck Resources for Teeta Creek on October 15[th] , 2019. Teck can earn an initial 60% interest ("First Option") in the Property by funding over a three-year period cumulative exploration expenditures and cash payments of $3,000,000 and $250,000, respectively, including a minimum of 1,000 metres of drilling. A minimum exploration expenditure of $500,000 is required before December 31, 2020. ArcWest granted to Teck a three-month extension to the December 31[st] deadline in return for an upfront payment of future cash payments as per the Teeta Creek definitive agreement totaling $125,000.

Teck completed a 1,116 m drill program at Teeta Creek in February 2021, the results of which were press released on September 20, 2021. Following the release of final reports on the program, Teck has relinquished its options to earn an interest in the Teeta Creek project. ArcWest is now considering new funding partners in order to advance the projects. ArcWest’s recommended targets for porphyry Cu-Mo-Au and epithermal Au-Ag on the Teeta Creek project remain to be drill tested.

NVI

ArcWest’s 100% owned, road accessible NVI porphyry Cu-Mo-Au project is located approximately 16 km southwest of BHP-Billiton’s past producing Island Copper porphyry Cu-Mo-Au mine, and approximately 40 km south of NorthIsle Copper and Gold Inc.’s advanced stage Hushamu porphyry Cu-Au. The 6,884-hectare NVI property was

staked to cover a zone of porphyry Cu style veining discovered by ArcWest geologists on its west side (NVI showing; see ArcWest August 23[rd] press release), multiple historic Cu occurrences on its east side, and a large belt of Miocene volcanic-intrusive centres that have recently been recognized as prospective for porphyry Cu-Au mineralization. Similarly aged centres in northern Vancouver Island are host to significant porphyry Cu-Mo-Au mineralization, including ArcWest’s nearby Teeta Creek project, which was optioned to Teck in an earn-in agreement announced on October 15, 2019.

ArcWest announced an earn-in and joint venture agreement with Teck Resources for NVI on December 20, 2019. Teck can earn an initial 60% interest ("First Option") in the Property by funding over a four-year period cumulative exploration expenditures of $2,000,000 and staged cash payments of $150,000. A minimum exploration expenditure of $150,000 was required before January 15, 2021. This exploration expenditure included completed desktop studies, geological mapping and geochemical sampling. Following the release of final reports on the program, Teck has relinquished its options to earn an interest in the Teeta Creek and NVI projects. ArcWest is now considering new funding partners in order to advance the projects.

References:

- Roulston, L. (2021): Golden Triangle Update; Resource World, URL https://resourceworld.com/golden triangle update/ (September, 2021)

Investors are cautioned that ArcWest has not verified the historic data from the any of the Todd Creek, Willoughby, Oweegee Dome, Oxide Peak, Eagle, Huckleberry, NVI, Rip, Sparrowhawk or Teeta Creek properties. The true widths of any of the properties’ drill intersections are unknown at this time. Investors are cautioned that ArcWest Exploration Inc. has not verified the data from the Brucejack, KSM-Iron Cap, Treaty Creek, Mt. Milligan, Kwanika, Stardust, Baker, Shasta, Kemess, Bell, Granisle, Morrison, Island Copper and Hushamu deposits. Further, the presence and style of mineralization on these properties is not necessarily indicative of similar mineralization on the ArcWest Exploration Inc. property.

Historical assays have not been verified by ArcWest but have been cited from sources believed to be reliable. ArcWest's disclosure of a technical or scientific nature has been reviewed and approved by Nigel Luckman, PGeo, who serves as a Qualified Person under the definition of National Instrument 43-101.

Results of Operations

Selected Annual Financial Information

The following table represents selected financial information for the Company’s years ended December 31, 2021, 2020 and 2019:

Selected Statement of Operations Data

	2021	2020	2019
Comprehensive Loss for the Year	$355,947	$245,756	$1,146,505
Weighted average number of shares outstanding	82,526,150	69,408,533	60,680,982
Loss per share, basic and diluted	$(0.00)	$(0.00)	$(0.02)

The Company incurred a loss of $355,947 ($0.00 per share) for the year ended December 31, 2021 compared to a loss of 245,756 ($0.00 per share) for the year ended December 31, 2020. The expenses with the greatest variances were as follows:

Investor relations - $8,864 (2020 - $65,398) – Investor relations costs decreased during the year ended December 31, 2021 due to a reduction in conference attendance and expiry of investor relations contracts.

Wages & Administrative - $231,289 (2020 - $269,902) – Wages & Administrative costs decreased during the year ended December 31, 2021 as the salaries expensed in 2020 decreased by $38,613.

Share-based payments - $169,067 (2020 - $13,911) – The increase in share-based payments is the result of 2,915,000 options granted in 2021 and the related vesting charge.

Other income - $75,936 (2020 - $10,000) – In 2021, other income included additional option payments received on mineral properties that were was more than what had been previously capitalized to the properties.

Gain on marketable securities - $83,462 (2020 – $226,854) – The Company held common shares in TDG Gold, P2 Gold, Wedgemount Resources Corp. and Strikepoint Gold. over the years ended December 31, 2021 and 2020. In 2021, the $83,462 gain is made up of a realized gain of $97,456 from the sale of shares and an unrealized loss of $13,994 from the revaluation of shares at the end of the year. In 2020, the $226,854 gain is made up of a $19,903 realized loss from the sale of shares and an unrealized gain of $246,757 from the revaluation of shares at the end of the year.

Selected Statement of Financial Position Data

	December 31, 2021	December 31, 2020
Cash and cash equivalents	$2,361,157	$2,518,147
Net workingcapital	$2,819,568	$3,077,668
Total assets	$6,547,250	$6,718,386
Longterm liabilities	$nil	$30,000

Quarterly Information

The following table presents the Company’s quarterly results for the periods ending March 31, 2020, to December 31, 2021, inclusive:

(unaudited)	2021 Q4	2021 Q3	2021 Q2	2021 Q1
Total assets Working capital (Loss) income for the period (Loss) earnings per share	$6,547,250 $2,819,568 ($117,659) ($0.00)	$6,649,082 $2,981,113 ($81,176) ($0.00)	$6,675,406 $2,981,075 $15,971 0.00	$6,638,741 $2,938,112 ($173,083) ($0.00)
(unaudited)	2020 Q4	2020 Q31	2020 Q2	2020 Q1
Total assets Working capital (Loss) income for the period (Loss) earnings per share	$6,718,386 $3,077,668 $58,234 $0.00	$6,645,054 $3,076,363 ($118,820) ($0.00)	$4,916,198 $611,884 $2,811 $0.00	$4,869,307 $669,951 ($187,981) ($0.00)

Note 1: Cash and cash equivalents, net working capital, and total assets increased in 2020 due to the private placement of 19,350,000 units (“Units”) at a price of $0.10 per Unit for gross proceeds of $1,935,000 that occurred during the period.

Liquidity and Capital Resources

As at December 31, 2021, the Company had a cash balance of $2,361,157and a working capital position of $2,819,568 as compared to a cash balance of $2,518,147 and a working capital position of $3,077,668 as at December 31, 2020. The decrease in cash and cash equivalents at December 31, 2021 compared to December 31, 2020 was primarily due to the following:

Operating activities – Cash used in operating activities for the year ended December 31, 2021, was $360,248 (2020 - $360,410). The cash used in operating activities was due to the net loss offset by an increase in items not affecting cash, such as share-based payments.

Investing activities – Cash provided by investing activities for the year ended December 31, 2021, was $203,258 (2020 – $160,816). The increase in cash provided by investing activities was due to the Company’s sale of certain marketable securities during the period.

Financing activities – Cash provided by financing activities for the year ended December 31, 2021, was $nil (2020 – $1,921,242). The cash provided by financing activities in the prior year was due to the Company’s private placement of 19,350,000 units (“Units”) at a price of $0.10 per Unit for gross proceeds of $1,935,000 that occurred during the period.

Capital expenditures – During the year ended December 31, 2021, cash deferred exploration and evaluation costs of $67,113 were spent on the properties (2020 - $28,442).

Related Party Transactions

During the years ended December 31, 2021 and 2020, the Company entered into the following transactions with related parties:

The Company paid consulting fees of $nil (2020 - $6,000) to Tanun Holdings Ltd., a company controlled by the spouse of John Meekison, the Chief Financial Officer and director of the Company.
For accounting purposes, executive compensation is split between exploration project activities (which is capitalized to mineral properties) and administrative activities which is allocated to office and administrative expense. Accordingly, the Company paid salaries and wages of $445,000 (2020 - $439,167) to the Chief Financial Officer, Chief Executive Officer, the Chief Operating Officer and the Vice President of Exploration of the Company. Of this amount, $241,312 (2020 - $241,614) was capitalized to the mineral properties, $54,906 was included in other receivables as a joint venture charge to Sanatana (2020 - $nil), and $148,782 (2020 - $192,135) was included in office and administrative expenses for the year ended December 31, 2021.
Included in share-based payment is $105,651 (2020 - $5,783) relating to directors and officers of the Company.

As at December 31, 2021, $14,046 (December 31, 2020 - $5,058) was owed to related parties and included in accounts payable.

Key management includes directors and executive officers of the Company. Other than the amounts disclosed above, there was no other compensation paid or payable to key management for employee services for the reported periods.

Financial Instruments and Capital Risk Management

As at December 31, 2021, the Company’s financial instruments are comprised of cash and cash equivalents, marketable securities, receivables, accounts payable, and loan payable. The fair value of these financial instruments approximates their carrying value, unless otherwise noted.

The Company’s risk exposures and the impact on the Company’s financial instruments are summarized below:

Credit risk

Credit risk is the risk of an unexpected loss if a customer or third party to a financial instrument fails to meet its contractual obligations. The Company’s credit risk is primarily attributable to its cash and cash equivalents and receivables. The Company limits exposure to credit risk by maintaining its cash and cash equivalents with large financial institutions. The Company’s receivables primarily consist of goods and services tax receivable due from the Government of Canada which are all current. Credit risk is assessed as low.

Liquidity risk

The Company’s approach to managing liquidity risk is to ensure that it will have sufficient liquidity to meet liabilities when due. As at December 31, 2021, the Company had a cash and cash equivalents balance of $2,361,157 to settle current liabilities of $69,879. All of the Company’s current financial liabilities have contractual maturities of 30 days or due on demand and are subject to normal trade terms. Liquidity risk is assessed as low.

Market risk

Market risk is the risk of loss that may arise from changes in market factors such as interest rates, foreign exchange rates, and commodity and equity prices.

(a) Interest rate risk

The Company has cash balances and no interest-bearing debt. As of December 31, 2021, the Company has an interest-bearing financial asset in the form of a GIC with a principal amount of $1,642,316 for a term of one year which bears interest at an average rate of 0.5% per annum. The GIC funds can be liquidated without an early redemption penalty. Interest rate risk is assessed as low.

(b) Foreign currency risk

The Company does not have assets or liabilities in a foreign currency and is not exposed to foreign currency risk.

The Company is exposed to price risk with respect to commodity and equity prices. Equity price risk is defined as the potential adverse impact on the Company’s earnings due to movements in individual equity prices or general movements in the level of the stock market. Commodity price risk is defined as the potential adverse impact on earnings and economic value due to commodity price movements and volatilities. The Company closely monitors commodity prices, individual equity movements, and the stock market to determine the appropriate course of action to be taken by the Company.

Capital management

Capital is comprised of the Company’s shareholders’ equity and any debt that it may issue. As at December 31, 2021, the Company’s shareholders’ equity was $6,447,371 and it had $99,879 in current liabilities. The Company’s objectives when managing capital are to maintain financial strength and to protect its ability to meet its on-going liabilities, to continue as a going concern, to maintain creditworthiness and to maximize returns for shareholders over the long term. Protecting the ability to pay current and future liabilities includes maintaining capital above minimum regulatory levels, current financial strength rating requirements and internally determined capital guidelines and calculated risk management levels. The Company is not subject to any externally imposed capital requirements.

Off Balance Sheet Arrangements

The Company has no off-balance sheet arrangements.

Investor Relations

The Company has no investor relations agreements.

Outstanding Share Data

Shares Outstanding:

As at April 29, 2022 the Company had the following shares outstanding:

Class Common Shares - Authorized Unlimited, without par value - Issued and outstanding: 82,526,150

Warrants Outstanding:

As at April 29, 2022 the Company had outstanding warrants enabling the holders to acquire common shares as follows:

Share Purchase Warrants: 9,675,000 Total Warrants: 9,675,000

Share Purchase Warrant entitle the holder to acquire additional shares as follows:

(1) 9,675,000 at a price of $0.15 per share for a period of three years expiring August 28, 2023.

Options Outstanding:

As at April 29, 2022 the Company had outstanding stock options enabling the holders to acquire common shares as follows:

	Number of Shares Exercise Price Expiry Date
	4,400,000 $0.15 October 22, 2023 480,000 $0.10 April 2, 2024 1,865,000 $0.105 January 13, 2026 225,000 $0.105 October 14, 2026 750,000 $0.15 October 14, 2026 7,720,000

Risks and Uncertainties

Exploration and Development Risk

The Company’s properties are in early exploration stages and are without a known body of commercial ore. Exploration for mineral resources involves a high degree of risk and few properties that are explored are ultimately developed into producing mines. Discovery of mineral deposits is dependent upon a number of factors, not the least of which are the technical skills of the exploration personnel involved and the capital required for the programs. The cost of conducting mineral exploration programs may be substantial and the likelihood of success is difficult to assess. There is no assurance that the Company’s mineral exploration activities will result in any discoveries of new bodies of commercial ore. There is also no assurance that even if commercial quantities of ore are discovered that an ore body would be developed and brought into commercial production. The commercial viability of a mineral deposit once discovered is also dependent upon a number of factors, some of which are the particular attributes of the deposit such as size, grade and proximity to infrastructure, commodity prices and government regulations, including regulations relating to royalties, allowable production, importing and exporting of minerals, and environmental protection. Most of the above factors cannot be predicted and are beyond the control of the Company. The Company attempts to mitigate its exploration risk by maintaining a diversified portfolio of projects that includes exposure to a variety of gold and copper targets in a number of geologic environments. Management also balances exploration risks through earn-in option agreements with other companies.

Financial Markets

Presently, the Company strives to obtain the majority of its working capital from other companies that are funding exploration on ArcWest projects in order to earn an interest in the mineral rights. However, the Company will also be dependent on the equity markets as a source of operating working capital and funding for any advanced exploration and development activities that may be needed on its projects. The Company’s capital resources are largely determined by the strength of the resource markets and by the status of the Company’s projects in relation to these markets, and its ability to compete for investor support of its projects. Consequently, there can be no assurance that equity financing will be available to the Company in the amount required at any time or for any period or if available, that it can be obtained on terms satisfactory to the Company.

Metal Prices

The prices of gold and copper are affected by numerous factors including central bank sales, producer hedging activities, the relative exchange rate of the U.S. dollar with other major currencies, supply and demand, political, economic conditions and production levels. In addition, the prices of gold and copper have been volatile over short periods of time due to speculative activities. The price of other metals and mineral products that the Company may be exploring for, all have the same or similar price risk factors. The prevailing price of metals and speculation on future price of metals by the investing public can have strong impacts on the share prices of exploration companies such as ArcWest.

Cash Flows

The Company currently has no revenue from its exploration operations. However, it does generate revenues from time to time on management fees charged to third parties where the Company is retained for project exploration or development work. Additionally, sources of capital currently available to the Company are the sale of its marketable securities, equity capital or the offering of an interest in its projects to another party.

Market Volatility for Marketable Securities

The Company’s marketable securities consist of shares of exploration companies that are historically very volatile. There is no assurance that the Company will be able to recover the current fair market value of those shares. The Company also may not be able to sell the shares it holds in other companies in an illiquid market.

Possible Dilution to Present and Prospective Shareholders

The Company’s plan of operation, in part, contemplates the financing of its business by the issuance of securities and possibly incurring debt. Any transaction involving the issuance of previously authorized but unissued shares of common stock, or securities convertible into common stock, would result in dilution, possibly substantial, to present and prospective holders of common stock. The Company usually seeks earn-in option agreement partners to fund in whole or in part exploration projects. This dilutes the Company’s interest in properties. This dilution is undertaken to spread or minimize the risk and to expose the Company to more exploration opportunities. However, it means that any increased market capitalization or profit that might result from a possible discovery would be shared with the option agreement partner. There is no guarantee that the Company can find a third party to enter an earn-in agreement for any property.

Share Trading Volume

The relatively low trading volume of the Company’s shares reduces the liquidity of an investment in its shares. Trading volumes fluctuate with market conditions and seasons. The Company attempts to reduce this risk by having multiple projects that are continually generating news and therefore investor interest and trading volume.

Volatility of Share Price

Market prices for shares of early stage companies are often volatile. Factors such as announcements of mineral discoveries or discouraging exploration results, changes in financial results, and other factors could have a significant effect on share price.

Competition

There is aggressive competition within the mining industry for the discovery and acquisition of properties considered to have commercial potential. The Company competes with other exploration and mining companies, many of which have greater financial resources than the Company, for the acquisition of mineral claims, leases and other mineral interests as well as for the recruitment and retention of qualified employees and other personnel.

Dependence on Management

The Company depends heavily on the business expertise of its management. There is risk to the Company’s ability to execute its business plans if some or all of the current management team were to suddenly leave the Company or become incapable of performing their individual and collective responsibilities. The Company has mitigated the risk of its managers leaving for other companies through competitive compensation, cash bonuses and by providing options to purchase ArcWest stock. Some of the senior managers hold substantial share positions in ArcWest and are motivated to remain with the Company. Despite the mitigation measures, the Company still depends heavily on its current management.

Title Risk

Although the Company has taken steps to verify title to mineral properties in which it has an interest, in accordance with industry standards for the current stage of exploration of such properties, these procedures do not guarantee a clear title. Property title may be subject to unregistered prior agreements and regulatory requirements. The Company is not aware of any disputed claims of title.

Environmental

The Company’s exploration and development activities are subject to extensive laws and regulations governing environment protection. The Company is also subject to various reclamation related conditions. Although the Company closely follows and believes it is operating in compliance with all applicable environmental regulations, there can be no assurance that all future requirements will be obtainable on reasonable terms. Failure to comply may result in enforcement actions causing operations to cease or be curtailed and may include corrective measures requiring capital expenditures. Intense lobbying over environmental concerns by non-governmental organizations has caused some governments to cancel or restrict development of mining projects. Current publicized concern over climate change may lead to carbon taxes, requirements for carbon offset purchases or new regulation. The costs or likelihood of such potential issues to the Company cannot be estimated at this time.

Laws and Regulations

The Company’s exploration activities are subject to extensive federal, provincial and local laws and regulations governing prospecting, development, production, exports, taxes, labour standards, occupational health and safety, Covid-19 regulations and practices, mine safety and other matters in all the jurisdictions in which it operates. These laws and regulations are subject to change, can become more stringent and compliance can therefore become more

costly. The Company applies the expertise of its management, advisors, employees and contractors to ensure compliance with current laws.

Local Resident & First Nations Concerns

The exploration, development and mining of the Company’s projects could be subject to claims and/or involvement from local residents and First Nations that could either prevent or delay exploration and development of the Property.

Litigation

In the course of conducting its business and operations, the Company or its directors may be subject to a variety of civil or other legal proceedings, with or without merit.

Management’s Responsibility for Financial Statements

The Company’s management is responsible for presentation and preparation of the financial statements and the MD&A. The MD&A have been prepared in accordance with the requirements of securities regulators, including National Instrument 51-102 of the Canadian Securities Administrators.

The financial statements and information in the MD&A necessarily include amounts based on informed judgments and estimates of the expected effects of current events and transactions with appropriate consideration to materiality. In addition, in preparing the financial information, we must interpret the requirements described above, make determinations as to the relevancy of information included, and make estimates and assumptions that affect reported information.

The MD&A also includes information regarding the impact of current transactions and events, sources of liquidity and capital resources, operating trends, risks and uncertainties. Actual results in the future may differ materially from our present assessment of this information because future events and circumstances may not occur as anticipated.

Additional Disclosure for Venture Issuers Without Significant Revenue – Mineral Property Expenditures

As at December 31, 2021 and December 31, 2020, the Company has capitalized the following acquisition and exploration costs:

								Northern
								Vancouver
	Oweegee	Todd Creek	Oxide Peak	Eagle	Rip	Teeta Creek	Sparrowhawk	Island	Huckleberry	Total
	$	$	$	$	$	$	$	$		$
Balance, December 31, 2019	1,129,259	1,250,453	446,677	309,842	303,025	247,837	113,416	5,377	14,932	3,820,818
Environmental and permitting	2,000	2,000	‐	‐	‐	‐	‐	‐	‐	4,000
Field support	‐	820	‐	‐	‐	‐	‐	‐	‐	820
Geochemistry and geology	1,681	3,023	(80)	14,285	1,820	‐	4,290	‐	‐	25,019
Option payments (Note 9)	‐	137,255	‐	‐	‐	‐	‐	‐	‐	137,255
Staking	‐	‐	‐	‐	9,629	‐	‐	‐	‐	9,629
Travel and accommodation fees	‐	920	‐	521	‐	‐	920	‐	‐	2,361
Wages and salaries (Note 11)	67,156	87,625	10,625	27,656	9,219	5,594	24,469	3,281	5,990	241,615
	1,200,096	1,482,096	457,222	352,304	323,693	253,431	143,095	8,658	20,922	4,241,517
Option payments received	‐	(220,000)	(375,644)	(18,000)	‐	(125,000)	‐	‐	‐	(738,644)
Balance, December 31, 2020	1,200,096	1,262,096	81,578	334,304	323,693	128,431	143,095	8,658	20,922	3,502,873
Field support	‐	158	‐	‐	18	‐	5,978	‐	‐	6,154
Geochemistry and geology	20,801	10,195	6,220	7,048	5,355	3,010	27,758	‐	1,190	81,577
Travel and accommodation fees	8,232	3,625	‐	1,071	6,945	‐	8,290	‐	‐	28,163
Wages and salaries (Note 11)	67,280	26,532	25,968	25,718	41,095	16,938	26,313	4,781	6,687	241,312
	1,296,409	1,302,606	113,766	368,141	377,106	148,379	211,434	13,439	28,799	3,860,079
Option payments received	(11,500)	(150,000)	‐	(109,980)	‐	‐	‐	(11,471)	(28,736)	(311,687)
BC Mining Exploration Tax Credit refund	(22,134)	(26,166)	(5,443)	(7,153)	(2,899)	(9,935)	(15,145)	(1,968)	(63)	(90,906)
Balance, December 31, 2021	1,237,335	1,140,954	111,333	255,820	375,680	144,809	171,924	‐	‐	3,457,486