basecarbon

BASE CARBON INC.

MANAGEMENT'S DISCUSSION & ANALYSIS

FOR THE THREE MONTHS ENDED

MARCH 31, 2026

(EXPRESSED IN UNITED STATES DOLLARS)

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

base carbon

Introduction

This management's discussion and analysis ("MD&A") of the financial condition and results of the operations of Base Carbon Inc. (the "Company" or "Base Carbon") constitutes management's review of the factors that affected the Company's consolidated financial and operating performance for the three months ended March 31, 2026. This MD&A should be read in conjunction with the Company's unaudited condensed interim consolidated financial statements for the three months ended March 31, 2026 (the "consolidated financial statements"), in addition to the audited annual consolidated financial statements of the Company for the year ended December 31, 2025, and together with the notes thereto. This MD&A is dated as of May 14, 2026, unless otherwise indicated.

Unless otherwise indicated and as hereinafter provided (see "Use of Non-IFRS Financial Measures" section below), all financial information contained in this MD&A, and the Company's consolidated financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB"). Unless otherwise noted in this MD&A, all monetary amounts are expressed in thousands of United States dollars or $, and "we", "us" and "our" refer to the "Company" or "Base Carbon" including each of its subsidiaries.

Certain statements in this MD&A constitute forward-looking statements or forward-looking information within the meaning of applicable securities laws. The "Caution Regarding Forward-looking Statements" section in this MD&A should be carefully reviewed and no undue reliance placed on any such forward-looking statements.

The Company exists under the Business Corporations Act (Ontario). Its registered and mailing office is located at 50 Carroll Street, Toronto, Ontario, M4M 3G3.

Use of Non-IFRS Financial Measures

This MD&A references certain financial measures that are not defined under IFRS but are provided to offer investors valuable supplemental insights into the Company's financial performance. These measures facilitate period-over-period comparisons by adjusting for items that may fluctuate independently of business performance and enhance transparency regarding key metrics used by management in operating the business. As these measures do not have standardized definitions under IFRS, they may not be comparable to similarly titled measures reported by other companies. They are intended to complement IFRS measures by offering additional perspective on the Company's operational results from management's viewpoint and should not be viewed in isolation or as a replacement for IFRS-reported financial information.

The non-IFRS measures presented are "adjusted comprehensive (loss) income" for the period, "adjusted comprehensive (loss) income on a per share basis" and "adjusted comprehensive income (loss) on a diluted per-share basis". For more information about this measure, why it is used by the Company, and a reconciliation to the most directly comparable measure under the IFRS Accounting Standards, refer to the section "Non-IFRS Financial Measures" of this document.

Caution Regarding Forward-Looking Statements

This MD&A contains forward-looking statements about the Company's objectives, plans, goals, aspirations, strategies, financial condition, results of operations, cash flows, performance, prospects, opportunities, and legal and regulatory matters. Specific forward-looking statements in this MD&A include, but are not limited to, statements with respect to the Company's anticipated future results, events, plans, strategic initiatives, future liquidity, planned capital investments, statements as to expectations for the Company's current carbon credit projects in development and future pipeline opportunities, including the steps involved to

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

base carbon

realize on such opportunities and the timeline in which such opportunities may be realized, as to the timing and number of carbon credits expected to be generated by such carbon credit projects and the resulting financial performance, and under the headings "Project Updates and Details" and "Outlook".

Forward-looking statements are typically identified by words such as "expect", "anticipate", "believe", "foresee", "could", "estimate", "goal", "intend", "plan", "seek", "strive", "will", "may", "maintain", "achieve", "grow", "should" and similar expressions, as they relate to the Company and its management. Forward-looking statements reflect the Company's current estimates, beliefs and assumptions, which are based on management's perception of historical trends, current conditions and expected future developments, as well as other factors it believes are appropriate in the circumstances. The Company's expectation of operating and financial performance in 2026 and beyond is based on certain assumptions including assumptions about operational growth, anticipated cost savings, operating efficiencies, anticipated benefits from strategic initiatives, future liquidity, and planned capital investments. The Company's estimates, beliefs and assumptions are inherently subject to significant business, economic, competitive, and other uncertainties and contingencies regarding future events and as such, are subject to change. There is no assurance that such estimates, beliefs and assumptions will prove to be correct.

In particular, and without limiting the generality of the foregoing, this MD&A contains forward-looking statements concerning:

the implementation of the Company's current business plans and strategies and future changes thereto;
expectations regarding carbon market trends, overall carbon market growth rates and future increase of prices for carbon credits, including with respect to the Carbon Offsetting and Reduction Scheme for International Aviation ("CORSIA") and the implementation of Article 6 of the Paris Agreement and the application of Article 6 Authorized labels;
expectation of inclusion eligibility of the Company's carbon credits in compliance markets, such as CORSIA;
expectations for the Company's current carbon removal and carbon reduction projects, including as to the timing for carbon credit issuances for such projects and the number of carbon credits expected to be generated by such projects;
expectations with respect to future pipeline opportunities, including the steps involved to realize on such opportunities and the timeline in which such opportunities may be realized;
future development activities, including acquiring interests in carbon projects and carbon credits and the development of software and technological applications to carbon credit projects and carbon credits;
implementation of the Paris Agreement and the issuance of correspondingly adjusted carbon credits pursuant to government regulation and existing project agreements;

Although management believes that the anticipated future results, performance or achievements expressed or implied by the forward-looking information are based upon reasonable assumptions and expectations, readers should not place undue reliance on forward-looking information because it involves assumptions, known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements to differ materially from anticipated future results, performance or achievements expressed or implied by such forward-looking information.

The forward-looking statements made herein are subject to a variety of risks and uncertainties, many of which are beyond the Company's control, which could cause actual events or results to differ materially and adversely from those reflected in the forward-looking statements. These risks and other factors are described or referred to herein or described in the Company's Annual Information Form for the year ended December 31, 2025 (the "AIF") under the heading "Risk Factors", copies of which are available under the Company's profile on SEDAR on www.sedarplus.ca.

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

Investors and all readers are also cautioned that the factors and assumptions described above, in the AIF and this MD&A are not exhaustive. Readers are also cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements. Should one or more of the risks and uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially and adversely from those described in the forward-looking statements. The Company's actual results, programs and financial position could differ materially from those expressed in or implied by these forward-looking statements, and accordingly, no assurance can be given that the events anticipated by the forward-looking statements will transpire or occur, or that, if any of them do so, what benefits the Company will derive there from. The forward-looking statements contained in this MD&A are made as of the date of this MD&A unless otherwise stated and are expressly qualified by this cautionary statement. The Company does not undertake any obligation to publicly update or revise any forward-looking statements except as expressly required by applicable securities laws.

General Business Description

Base Carbon is a publicly traded entity which is listed on Cboe Canada under the trading symbol "BCBN" and trading on the OTCQX Best Market under the symbol "BCBNF". Base Carbon runs general operations, including ownership of carbon removal and carbon reduction projects, through its wholly owned subsidiary Base Carbon Capital Partners Corp. ("BCCPC").

Base Carbon, through BCCPC, provides capital, development expertise and management operating resources to projects involved in both the global voluntary and compliance carbon markets and broader environmental markets. The Company seeks to be the preferred carbon project partner in providing capital and developmental resources to carbon projects globally and, where appropriate, will endeavour to utilize technologies within the evolving carbon industry to enhance efficiencies, commercial credibility, and trading transparency.

The Company has monitored the continued evolution of the compliance carbon markets, such as CORSIA, and has worked with project developers to facilitate eligibility of the Company's carbon credits into various compliance markets. Base Carbon may consider developing additional compliance related projects in the future. The Company has, and is, investigating investments which, in addition to generating carbon credits, produce a commercial product.

Key Highlights

The financial discussions in this MD&A relate to results for the three months ended March 31, 2026 ("Q1 2026" or "first quarter"), compared to the same period in 2025 ("Q1 2025") and the results for the year-ended December 31, 2025. All financial amounts are stated in approximate thousands of US dollars, unless otherwise noted.

During the three months ended March 31, 2026, the Company experienced the following significant operational highlights:

Issuance of 639,609 carbon credits under Verra's latest cookstoves methodology, VM0050 for the carbon credit revenue participation asset ("RPA").
Completed compliance sales of CORSIA – First Phase, 2024-2026 Eligible ("CORSIA-eligible") labeled RPA carbon credits in Q1 2026, resulting in a realized cash settled gain on the RPA of $1.2 million.
Upon completion of relevant project milestones, the Company deployed $1.2 million into the India ARR Project.

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

base carbon

Continually improved the Company's equity cost of capital by repurchasing and cancelling 1.77 million shares through the Company's normal course issuer bid ("NCIB").

In the three months ended March 31, 2026, the Company reported financial results of:

Net comprehensive loss of $1.1 million.
Current assets of $41.2 million which were primarily composed of $2.9 million in cash, $0.8 million in short term loan receivable, $3.3 million in the RPA, $16.4 million in carbon credit inventory, $16.9 million in current investments in carbon credit projects and the Company pre-paid insurance of $0.6 million relating to the issuance of carbon credits under the Rwanda Cookstoves Project.
Non-current assets of $64.9 million, represented almost exclusively by non-current investments in carbon credit projects of $64.8 million.

Subsequent to March 31, 2026 and as of the date of this MD&A, Base Carbon noted the following significant event:

The Government of Vietnam issued Decree No. 112/2026/ND-CP (the "Decree") establishing authorization process for international carbon credit transfers under Article 6.2 of the Paris Agreement. Refer to "Subsequent Events" for further details on the Government of Vietnam issued Decree.

Overall Financial Performance

In Q1 2026, the Company generated $1.2 million in realized cash settled gains on the RPA, and incurred total operating expenses of $5.7 million, comprised of a $4.8 million write-down on inventory and remaining $0.9 million in operating expenses. This resulted in an operating loss of $4.5 million in the first quarter. The Company additionally recognized a $1.2 million settlement and reduction of the RPA relating to the sale of RPA carbon credits in the period. This was offset by an unrealized gain of $4.4 million from the Company's investments in carbon credit projects arising primarily from the unwinding of the discount rates relative to the time value of money, as well as the Company's decision to maintain the VMR006 methodology for carbon credits generated from the Vietnam Household Devices Project for vintage years up to and including 2026, and other income of $0.3 million relating to a secured debenture. This resulted in a net and comprehensive loss of $1.1 million in the first quarter.

As at March 31, 2026, the Company had share capital of $44.6 million and net working capital of $40.9 million. The Company's $41.2 million in current assets were primarily composed of $2.9 million in cash, $0.8 million in short term loan receivables, $16.4 million in carbon credit inventory, $3.3 million in the RPA and $16.9 million in current investments in carbon credit projects. Current liabilities totaled $0.3 million, including $0.2 million in accounts payable and accrued liabilities, while total liabilities were $7.9 million, of which $7.6 million related to deferred tax liabilities and do not require a cash settlement in the current period.

During the quarter, the Company deployed $1.2 million into the India ARR Project. As at March 31, 2026, a cumulative $39.0 million had been deployed to the Company's three flagship projects.

Realized Cash Settled Gains

During the first quarter, the Company generated $1.2 million (Q1 2025 - $nil) in realized cash settled gains from its interest in the RPA. Comparatively, during Q1 2025 in the prior period, the Company generated $0.8 million in realized cash settled gains on investments in carbon credit projects.

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

base carbon

Operating Expenses

Base Carbon incurred $5.7 million (Q1 2025 - $1.8 million) in total operating expenses during the three months ended March 31, 2026. The Q1 2026 operating expenses included $4.8 million relating to the write-down of inventory in the first quarter primarily driven by the decrease in carbon credit price. The remaining Q1 2026 operating expenses of $0.9 million decreased year-over-year ("YoY") when compared to $1.8 million in Q1 2025.

The remaining operating expenses decreased by $0.9 million YoY primarily due to:

Salaries and wages by $0.4 million, a decrease principally from a reduction in variable compensation in the current period.
Consulting and professional fees by $0.2 million, a decrease primarily as a result of a reduction in the use of external service providers.
General and administrative by $0.3 million, a decrease primarily due to cost saving measures and a reversal of a prior year-end estimate for related party marketing services.

Comprehensive (Loss) Income for the Period

Base Carbon generated a net and comprehensive loss of $1.1 million in Q1 2026 (Q1 2025 - $0.5 million net and comprehensive income), a $1.6 million decrease in net and comprehensive income YoY.

Primary decreases to net and comprehensive (loss) income were a result of the decrease in carbon credit prices realized in Q1 2026. This resulted in a YoY movement of:

$4.8 million in write-down of inventory.
$1.2 million settlement of the RPA.

Partially offset by YoY movements of:

$2.8 million increase in unrealized gains from carbon credit projects.
$0.4 million increase in total realized cash settled gains in carbon credit projects.
$0.9 million decrease in remaining operating expenses as described above.

Adjusted Comprehensive (Loss) Income for the Period

Under IFRS 13, Base Carbon's investments in carbon credit projects for which there has been an issuance of credits and are therefore considered to be 'producing', are classified as financial instruments and, as such, are revalued quarterly using a discounted cash flow ("DCF") methodology. This approach estimates the present value of future projected cash flows, based on key assumptions including credit generation volumes, market pricing, and discount rates. These inputs are reviewed and updated on a quarterly basis, resulting in regular valuation changes. Such changes are reflected as unrealized gains or losses in the Condensed Interim Consolidated Statements of (Loss) Income and Comprehensive (Loss) Income, as well as in the Condensed Interim Consolidated Statements of Cash Flow.

Unrealized gain or loss adjustments are non-cash and reflect changes in valuation assumptions such as carbon credit volume and price forecasts, project timelines, and discount rates. They do not represent objective business performance or realized financial gains or losses. Accordingly, Base Carbon utilizes Adjusted Comprehensive (Loss) Income for the period to review underlying operational performance for the period.

The Company recorded an adjusted comprehensive loss in Q1 2026 of $5.5 million, compared to an adjusted comprehensive loss of $1.1 million in Q1 2025, representing a $4.4 million decrease YoY. This is a non-IFRS metric and for more information about this measure, why it is used by the Company, and a

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

base carbon

reconciliation to the most directly comparable measure under the IFRS Accounting Standards, please refer to the section "Non-IFRS Financial Measures".

Basic and Diluted Loss per Share

In Q1 2026, the Company recorded basic loss per share of $0.01. The basic weighted average number of common shares outstanding were 101,829,095. In Q1 2026, no dilution was taken due to the Company's loss position. In Q1 2025, the Company recorded basic and diluted earnings per share of $0.00. The basic and diluted weighted average number of common shares were 108,727,826 and 109,034,368 respectively. Diluted earnings per share includes the effect of stock options that are in-the-money.

Adjusted Basic and Diluted Loss per Share

In Q1 2026, the Company recorded an adjusted basic loss per share of $0.05 and the basic weighted average number of common shares outstanding were 101,829,095. In Q1 2025, the Company recorded adjusted basic loss per share of $0.01 and the basic weighted average number of common shares were 108,727,826. No dilution was taken in Q1 2026 or Q1 2025 due to the Company's loss position. This is a non-IFRS metric and for more information about this measure, why it is used by the Company, and a reconciliation to the most directly comparable measure under the IFRS Accounting Standards, please refer to the section "Non-IFRS Financial Measures".

Total Assets

As at March 31, 2026, the Company had total assets of $106.1 million (December 31, 2025: $108.9 million), a $2.8 million decrease quarter-over-quarter ("QoQ").

Total assets decreased due to the following movements:

$1.0 million in cash for operating expenses excluding the write-down of inventory, as previously described.
$4.8 million write-down of inventory as previously described.
$1.3 million used to repurchase shares through NCIB.
$3.4 million decrease in non-current investments in carbon credit projects from a reduction in carbon credit price and increased insurance costs.
$0.1 million decrease in short term loan receivable, as a result of a $0.4 million repayment of a secured debenture, netted against $0.3 million in fees and interest charged during the quarter.
$0.4 million spent to settle accounts payable and accrued liabilities.

Partially offset by the following increases in total assets:

$5.9 million increase in current investments in carbon credit projects, due to a higher crediting profile, a delay of the timing of project expansion costs and the unwinding of the discount rate.
$1.9 million increase in the RPA, due to the receipt of RPA carbon credits from the Rwanda Cookstoves Project.
$0.6 increase in prepaid assets relating to the prepayment of carbon credit insurance.

Total Liabilities

As at March 31, 2026, the Company had total liabilities of $7.9 million (December 31, 2025: $8.4 million), a $0.5 million decrease QoQ. This is primarily due to the Company paying $0.4 million to settle its accounts payable and accrued liabilities in Q1 2026.

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

base carbon

Shareholder's Equity

As at March 31, 2026, the Company had total shareholders' equity of $98.2 million (December 31, 2025: $100.5 million), a $2.3 million decrease. This is primarily due to a net loss of $1.1 million in Q1 2026 and $1.3 million spent repurchasing shares through the NCIB.

Outlook

The broader carbon credit market continues to face scrutiny, and as a result has experienced recent commercial and perception-based headwinds. Base Carbon remains confident in the sector's long-term fundamentals, particularly within the specific end-markets where the Company maintains active and deliberate exposure. With the approval from carbon credit registry Verra for the application of methodology VM0050 to the Company's Rwanda Cookstoves Project, the Company continues to enhance the quality and compliance-market positioning of its portfolio. Management continues to maintain confidence in its disciplined execution, resilient asset base, and rigorous underwriting processes.

Project Summary

Base Carbon's three flagship projects are the Rwanda Cookstoves Project, the Vietnam Household Devices Project, and the India ARR Project, all of which have met or exceeded management's base case commercial expectations in Q1 2026. Management is of the view that these projects will exceed the base case commercial expectations over their lifespans.

For a detailed and individualized overview of Base Carbon's key projects, refer to the "Project Updates and Details" section below.

CORSIA Approved VMR006 Methodology and Vietnam Regulatory Update

In November 2025, Verra's cookstove methodology VMR0006 was included in CORSIA Phase 1 (2024-2026) eligibility. Additionally, on April 1, 2026, the Government of Vietnam issued a Decree establishing the process by which the Government of Vietnam may issue a project letter of authorization pursuant to Article 6.2 of the Paris Agreement and the procedures by which carbon project developers may apply for government approval to transfer carbon credits to international counterparties with a "Corresponding Adjustment". In connection with the Decree, BCCPC and SIPCO elected to continue methodology VMR0006 for carbon credits generated by the project for vintage years up to and including 2026, resulting in an increase of approximately 3.8 million carbon credits expected to be issued relative to the estimates as of December 31, 2025. Carbon credits generated by the project for vintages 2027 onwards are expected to be transitioned to methodology VM0050, consistent with applicable CORSIA and Verra requirements. Refer to "Subsequent Events" for further details on the Government of Vietnam issued Decree.

CORSIA Approved VM0050 Methodology

In Q3 2025, Verra approved the application of CORSIA-compliant methodology VM0050 to the Company's Rwanda Cookstoves Project.

Verra's VM0050 standard has been applied by the Company to re-quantify previously issued carbon credits held in inventory and will be applied to future carbon credits anticipated to be generated from the Rwanda Cookstoves Project. As of the date of this MD&A, a portion of the Rwanda Cookstoves Project carbon credits have been tagged CORSIA-eligible which allows for the immediate sale and delivery into global aviation carbon offsetting markets. This milestone positions Base Carbon's inventory as a premium, compliance-grade carbon credit balance, potentially capable of achieving materially higher market values amid increasing demand and constrained global supply. For a detailed analysis on how the methodology update impacts Base Carbon's projects, refer to the "Project Updates and Details" section below.

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

base carbon

Monetization of Carbon Credit Inventories

As at March 31, 2026, the Company, through BCCPC and subject to the revenue sharing arrangement, holds 1,076,230 Rwanda carbon credits in inventory, of which approximately 0.7 million have been tagged with Verra's Article 6 Authorized and CORSIA-eligible labels. An additional 683,045 RPA carbon credits are held by project partner DelAgua for which the Company holds an economic interest. During Q1 2026, the Company, through project partner DelAgua, completed compliance sales of CORSIA-eligible RPA carbon credits, resulting in a realized cash settled gain of $1.2 million.

Organic Portfolio Expansion Opportunities

Within the existing portfolio, Base Carbon, through BCCPC, holds the right, but not the obligation, to expand its investment by making additional prepayments in the Vietnam Household Devices Project to increase the project's aggregate total of cookstoves to 1,200,000 and aggregate total of water purifiers to 600,000. In addition, the Company holds two options to expand the India ARR Project, each for 10 million trees (20 million trees total), as well as a right of first refusal relating to an extension or expansion of the initial project, including any additional future phases of the initial project beyond the initial 20-year project life. If exercised and expansion payments are made, these options could materially scale the projects' investment scope and resulting volume of carbon credit production. These rights represent compelling, risk-adjusted growth opportunities and are a key component of the Company's long-term strategic plan. All potential capital commitments are considered as a function of the Company's equity cost of capital and expected risk-adjusted returns. Given the operational successes to date, management's deep familiarity with each project, and established relationships with carbon credit buyers, any further capital commitments are viewed as highly attractive and value-accretive, subject to appropriate timing and balance sheet risk optimization.

Robust and Diversified Growth Pipeline of Carbon Reduction and Removal Projects

The Company continues to assess several high-quality carbon reduction and removal projects, remaining focused on robust, diversified, and highly-strategic opportunities originating from three key channels: (i) organic portfolio expansion opportunities, as discussed prior, (ii) proprietary, thesis-driven internal research and (iii) market-based inbounds with project investment opportunities. Base Carbon continues to receive a significant flow of regular capital investment opportunities, leading to the evaluation of approximately 40 - 50 investment opportunities per year. The Company maintains strong conviction in its existing portfolio and continued to view the market as increasingly attractive with time and capital discipline. Leveraging a disciplined and robust underwriting framework, Base Carbon evaluates each opportunity with a focus on downside protection, while maintaining upside potential and strategic optionality, an approach which has underpinned Base Carbon's strong performance in its first few years of operations.

Market Positioning and Strategic Focus

As the carbon market continues to evolve, the Company has observed a structural shift in demand towards removal-based carbon credits including voluntary carbon credits eligible for emerging compliance markets (such as CORSIA) and country specific emissions trading schemes (ETS). In response, Base Carbon is prioritizing nature-based and technology-based carbon credit removals and is actively investigating expansion into broader environmental industrials, as it identifies and evaluates its next round of project investments.

The Company has, and is, investigating opportunities which, in addition to generating carbon credits, produce a commercial product. These investments may include biochar, agroforestry, direct air capture, renewable natural gas, geological storage or other projects.

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

base carbon

Ongoing Common Share Buybacks

As of the date of this MD&A, Base Carbon's shares continue to trade at a significant discount to both book value and equity research estimates. As a result, the Company remains focused on delivering accretive value to shareholders and, should the current market valuation persist, the intention is to continue opportunistically repurchasing shares under the current NCIB program which was renewed on June 23, 2025. The Company is actively exploring complementary market mechanisms that achieve the dual end of (i) driving the best risk-adjusted shareholder accretion, and (ii) returning capital to shareholders as and when appropriate.

Project Updates and Details

Rwanda Cookstoves Project

In January 2022, the Company, through BCCPC, entered into a carbon reduction project agreement with DelAgua Health Rwanda (Voluntary) Limited ("DelAgua"), as in-country project developer, to supply cookstoves in Rwanda as part of an expansion of its existing carbon reduction project previously registered as a clean development mechanism (or CDM) project governed by the United Nations pursuant to the Kyoto Protocol. According to the terms of the agreement and the initial project methodology, BCCPC invested $8,825 to fund the manufacturing, distribution and monitoring of approximately 250,000 cookstoves across rural Rwanda in exchange for a revenue share arrangement applicable to the proceeds from the sale of the first 7.5 million carbon credits expected to be generated by the project.

The distribution of all 250,000 cookstoves to participating project households was completed in early 2023 and the project has been registered with Verra under project ID #4150, with the PDD (project design document) available on Verra's website. Also in 2023, the Company made its final investment into the project and because the project had not yet generated carbon credits, the cost approach was used to determine the fair value of the investment equal to the total disbursed investment payments of $8,825.

As announced during December 2023, the Government of Rwanda issued a letter of authorization (the "LOA") with respect to the Rwanda Cookstoves Project which resulted in Verra issuing its first ever Article 6 Authorized label for a carbon removal or reduction project. The Article 6 Authorized label is applied to carbon credits generated by a carbon removal or reduction project where the project host country agrees to apply to the corresponding adjustment concept with respect to such project. A corresponding adjustment is a concept included in Article 6 of the Paris Agreement and is intended to address the potential issue of double counting emission reductions. By applying a corresponding adjustment, the project host country agrees that the emission reductions from projects under its jurisdiction will not count towards such country's national commitment (NDC under the Paris Agreement) to lower carbon emissions.

In April 2024, BCCPC and DelAgua executed an amended and restated project agreement to facilitate the implementation of the LOA. Pursuant to the LOA, a copy of which may be found on Verra's website under Project ID 4150, adjustments to Article 6 Authorized carbon credits generated by the Rwanda Cookstoves Project and associated sales thereof are as follows:

(i) 2% of any Article 6 Authorized carbon credits issued are to be immediately retired to help offset global emissions,
(ii) 10% of any issued Article 6 Authorized carbon credits are to be transferred to the Government Rwanda to help achieve its NDC emission reduction targets, and
(iii) 5% of revenues generated from the initial sale of the remaining Article 6 Authorized carbon credits issued will be remitted to the Rwanda Green Fund ("RGF").

Under the terms of the revised project agreement, BCCPC will contribute $0.20 per carbon credit to RGF on the first 1,925,000 carbon credits generated and the parties will split the 5% RGF remittance attributable

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

base carbon

to sales revenue from remaining Article 6 Authorized carbon credits generated based upon each party's pro rata share of cashflows under the revenue sharing arrangement.

During 2024, 1.7 million Article 6 Authorized carbon credits were issued and delivered to the Company from the Rwanda Cookstoves Project, and a portion were sold to a third party. Transitioning the project from a development to production stage resulted in a project valuation update from a cost-based approach to an income-based approach utilizing a discounted cash flow ("DCF") model.

During 2024, the Company and DelAgua made the decision to update the project's methodology to Verra's VM0050 Energy Efficiency and Fuel-Switch Measures in Cookstoves, v1.0 to be potentially eligible for carbon credit sales into the compliance carbon market through CORSIA.

The estimated number of carbon credits expected to be issued over the life of the project, which are all subject to revenue share arrangement set out in the project agreement, is now approximately 4.6 million VM0050 carbon credits. This is comprised of 1.1 million VM0050 carbon credits which is the basis for the Company's inventory, RPA carbon credits in the amount of 0.7 million and anticipated future VM0050 carbon credit issuances in the amount of 2.6 million carbon credits.

Carbon credits received into inventory or the RPA by the Company and carbon credit sales have been outlined in ii) Rwanda Cookstoves Project Inventory and iii) Carbon Credit Revenue Participation Asset.

The table below summarizes the changes in the Rwanda Cookstoves Project valuation as at March 31, 2026, and December 31, 2025:

Rwanda Cookstoves Project (thousands of US dollars)	March 31, 2026	December 31, 2025
Balance, beginning of the period	18,072	7,812
Unrealized (loss) gains on investment in carbon credit projects (i)	(4,239)	14,315
Transfer to carbon credit revenue participation asset (iii)	(3,046)	(1,606)
Receipt of carbon credit inventory (ii)	-	(2,449)
Balance, end of the period	10,787	18,072

i) Investment in Rwanda Cookstoves Project

During the three months ended March 31, 2026, an unrealized loss of $4.2 million (December 2025 – $14.3 million gain) was recognized on the project. This was primarily driven by the decrease in carbon credit price from $19.73 to $15.25 and an increase in insurance costs.

The Company will continue to update its evaluation of the Rwanda Cookstoves Project on a quarterly basis, based on the project performance, market conditions, and various risk factors.

For more information regarding the transfer to the RPA and receipt of carbon credit inventory, refer to the "ii) Rwanda Cookstoves Project Carbon Credit Inventory" and "iii) Carbon credit revenue participation asset" sections below.

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

base carbon

ii) Rwanda Cookstoves Project Inventory

The table below summarizes the changes in the carbon credit inventory held as at March 31, 2026, and as at year ended December 31, 2025:

Number of carbon credits held in inventory	March 31, 2026	December 31, 2025
Balance, beginning of the period	1,076,230	1,712,193
Receipt of VMR0006 carbon credit inventory	-	192,810
Subtotal VMR0006 Balance	-	1,905,003
Re-quantification of inventory to VM0050 (ii)	-	(828,773)
Balance, end of the period VM0050	1,076,230	1,076,230
Carbon credit inventory value (thousands of US dollars)	March 31, 2026	December 31, 2025
---	---	---
Balance, beginning of the period	21,229	25,633
Receipt of carbon credit inventory during the period	-	2,448
Loss on re-quantification of inventory to VM0050 (ii)	-	(2,932)
Write-down of inventory (i) and (iii)	(4,816)	(3,920)
Balance, end of the period	16,413	21,229

During the year ended December 31, 2025, the Company performed a detailed review of its inventory balances and identified three distinct and material write-downs: (i) write-down of VMR0006 inventory at September 30, 2025, (ii) loss on re-quantification of inventory to VM0050, and (iii) write-down of VM0050 inventory at December 31, 2025.

(i) Based on the prevailing decline in VMR0006 carbon credit pricing during 2025, the Company determined a write-down of certain vintages was required. The write-down of inventory was in the amount of $2,064 at September 30, 2025.

(ii) Based on the approval of the new VM0050 methodology described above, the Company updated its inventory quantity and prices to reflect eligibility under the CORSIA scheme. Upon re-quantification, this resulted in a higher carbon credit price of $21.45. However, the inventory quantity declined from 1,905,003 VMR0006 to 1,076,230 VM0050 carbon credits at September 30, 2025. This resulted in a total loss on re-quantification of inventory to VM0050 of $2,932 at September 30, 2025.

(iii) At December 31, 2025, the Company, with its internal pricing model, determined that the net realizable value of VM0050 carbon credits decreased to $19.73 per credit. As a result, a further write-down of inventory in the amount of $1,856 was recognized at December 31, 2025.

During the three months ended March 31, 2026, Base Carbon's total inventory of 1,076,230 carbon credits was valued at $16,413, a write-down of $4,816 when compared to the value of $21,229 as at December 31, 2025. This write-down is as a result of a decrease in the carbon credit price from $19.73 to $15.25.

No additional carbon credits were received into inventory or sold from inventory during the three months ended March 31, 2026.

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

base carbon

iii) Carbon credit revenue participation asset

The table below summarizes the changes in the RPA for the three months ended March 31, 2026, and for the year ended December 31, 2025:

Number of carbon credit revenue participation asset	March 31, 2026	December 31, 2025
Balance, beginning of the period	243,973	-
Issuance of RPA carbon credits	639,609	243,973
Sale of RPA carbon credits	(200,537)	-
Balance, end of the period	683,045	243,973
Carbon credit revenue participation asset (thousands of US dollars)	March 31, 2026	December 31, 2025
---	---	---
Balance, beginning of the period	1,455	-
Issuance of RPA carbon credits	3,046	1,606
Unrealized loss on carbon credit revenue participation asset	-	(151)
Settlement of carbon credit revenue participation asset	(1,175)	-
Balance, end of the period	3,326	1,455

The RPA reflects the Company's ongoing financial interest in the issued carbon credits and will be measured at fair value going forward, with changes recognized through profit or loss. The reclassification ensures the carrying value aligns with the underlying rights and obligations following carbon credit issuance.

During the three months ended March 31, 2026, 639,609 RPA carbon credits were issued from the Rwanda Cookstoves Project with a total value of $3,046 based on the fair market value on the date received.

During the three months ended March 31, 2026, the Company, through project partner DelAgua, completed sales of CORSIA-eligible RPA carbon credits, resulting in a realized cash settled gain on the RPA of $1,170 and a reduction in the carrying value of the RPA and a settlement of $1,175. DelAgua remitted sale proceeds of approximated $700 to the Company. This payment is net of the revenue share arrangement amounts and a holdback of insurance premiums paid on all CORSIA-eligible carbon credits held by the parties. This transaction represents the first monetization of CORSIA-eligible carbon credits from the Rwanda cookstoves project following the VM0050 transition and CORSIA-eligible tagging, demonstrating the project's enhanced liquidity and standing within global compliance carbon markets.

Vietnam Household Devices Project

In May 2022, the Company, through BCCPC, entered into transaction documents to facilitate the development of a household devices carbon project in Vietnam, with Sustainability Investment Promotion and Development Joint Stock Company ("SIPCO") as in-country project developer. Citigroup was the carbon credit off-taker to SIPCO for the first phase of the Vietnam Household Devices Project.

BCCPC has fully funded its capital commitment of $20,829 used to fund the manufacturing, distribution and monitoring of approximately 850,000 cookstoves and 364,000 water purifiers across several provinces of Vietnam which were fully distributed in early 2023. BCCPC has the option to expand the project up to an aggregate total of 1,200,000 cookstoves and 600,000 water purifiers for an additional prepayment. Other than with respect to the expansion option prepayment, BCCPC has no further capital expenditure obligations.

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

base carbon

Project documentation also provides BCCPC with monitoring rights through all stages of the project and broad rights, including with respect to the project's carbon credit registry account, to step in and perform the obligations and functions of SIPCO in the event of a failure to perform by SIPCO.

During the first phase ("Phase 1") of the project which was completed in June 2025, SIPCO sold and transferred to BCCPC, and SIPCO purchased back from BCCPC for offtake by Citigroup pursuant to a fixed price off-take arrangement, the first 7.4 million carbon credits generated by the project.

During the second phase ("Phase 2") and remaining life of the project, BCCPC has the option to purchase all further carbon credits generated by the project on a yearly basis for $5 per carbon credit.

As noted herein, Verra, the project registry, has published an updated methodology for cookstove projects, VM0050, and transition to this methodology would require a re-quantification of future carbon credit issuances from this project. During Q2 2025, BCCPC and SIPCO elected to begin work to apply Verra's new methodology to the Vietnam Household Devices Project and BCCPC provided SIPCO with an operational loan in the amount of up to $200 to used by SIPCO for costs related to the methodology change.

In November 2025, Verra's cookstove methodology, VMR0006, was included in CORSIA Phase 1 (2024-2026) eligibility. Additionally, on April 1, 2026, the Government of Vietnam issued a Decree establishing the process by which the Government of Vietnam may issue a letter of authorization pursuant to Article 6.2 of the Paris Agreement and the procedures by which carbon project developers may apply for government approval to transfer carbon credits to international counterparties with a "Corresponding Adjustment". In connection with the Decree, BCCPC and SIPCO elected to continue methodology VMR0006 for carbon credits generated by the project for vintage years up to and including 2026, resulting in an increase of approximately 3.8 million carbon credits expected to be issued relative to the estimates as of December 31, 2025. Carbon credits generated by the project for vintages 2027 onwards are expected to be transitioned to methodology VM0050, consistent with applicable CORSIA and Verra requirements. Refer to "Subsequent Events" for further details on the Government of Vietnam issued Decree.

The estimated carbon credits expected to be issued over the life of the project is now 18.4 million carbon credits (7.4 million VMR0006 cookstove and AMS-III.AV water purifier carbon credits previously issued under Phase 1, 5.3 million VMR0006 cookstove carbon credits, 2.4 million VM0050 cookstove carbon credits, and 3.3 million AMS-III.AV water purifier carbon credits expected to be issued in Phase 2). Under the expansion option if exercised, the Company anticipates an additional 5.1 million VM0050 and AMS-III.AV carbon credits to be generated.

The Company will continue to update its evaluation of the Vietnam Household Devices Project on a quarterly basis, based on the project performance, market conditions, and various risk factors.

i) Investment in Vietnam Household Devices Project

The table below summarizes the changes in the Vietnam Household Devices Project valuation during the three months ended March 31, 2026, and the year ended December 31, 2025:

Vietnam Household Devices Project (thousands of US dollars)	March 31, 2026	December 31, 2025
Balance, beginning of the period	52,957	55,972
Unrealized gain (loss) on investment in carbon credit projects	8,635	(3,015)
Realized cash settled gains on investment in carbon credit projects	-	1,811
Settlements of investment in carbon credit projects	-	(1,811)
Balance, end of the period	61,592	52,957

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

base carbon

During the three months ended March 31, 2026, BCCPC received $nil (2025 - $790) in cash payments from the delivery and monetization of carbon credits from the Vietnam project.

During the three months ended March 31, 2026, an unrealized gain of $8,635 (2025 - $1,389) was recognized on the project. The gain was driven primarily by an increase of approximately 3.8 million carbon credits, reflecting the Company's election to continue normal course VMR0006 issuances for eligible vintages generated by the project, the deferral of the exercise and payments for the expansion option, and the unwinding of the discount rate. These positive impacts were partially offset by a decline in carbon credit prices and an increase in insurance costs.

As at March 31, 2026, SIPCO had delivered an aggregate total of 7.4 million carbon credits to BCCPC, which completed Phase 1 of the Vietnam Household Devices Project.

The Vietnam Household Devices Project has now entered Phase 2, under which the Company retains the option to purchase all future carbon credits generated by the project on a yearly basis at $5.00 per credit, subject to certain buyback options at prices materially higher than the Company's option price. An estimated 11.0 million carbon credits are anticipated to be generated during the project's second phase, with an additional 5.1 million carbon credits potentially available in connection with the exercise of the expansion option, bringing total potential production across all phases to approximately 23.5 million carbon credits.

Since the establishment of the Vietnam Household Devices Project and as of March 31, 2026, the Company has received aggregate cash payments of approximately $36,257 from the sale of carbon credits generated by the project at a total cost of $20,829 resulting in a full repayment of capital invested and a cash gain of approximately $15,428.

India Afforestation, Reforestation, and Revegetation (ARR) Project

As announced on August 8, 2023, the Company, through BCCPC, entered into an agreement to facilitate the development of a nature-based carbon removal project, focused on the reforestation of degraded rural farmlands in the northern Indian state of Uttar Pradesh. Value Network Ventures Pte Ltd. ("VNV") is the Company's project development partner.

The project's aim is to facilitate the planting of approximately 6,500,000 trees on rural farmlands and deserted lands in northern India. The planting of all project trees was completed during the year ended December 31, 2024. During 2025, pursuant to the project agreement with VNV, VNV planted an additional 400,000 trees in specific areas of operations due to changes in landholder participation. Mortalities on initial tree planting is an expected event in projects of this nature. The experienced tree mortalities is approximate to the high end of the expected range of mortalities, however, VNV continues to be contractually obligated to replace any trees lost to ensure a maintained standing stock of at least 6,500,000 trees.

During Q2 2025, the India ARR Project was submitted for validation and in Q4 2025, BCCPC and VNV agreed to transition to new Verra methodology VM0047 and applied for the ABACUS label. Work is currently underway for validation and verification of the project under VM0047. Based on current project plans and subject to successful implementation and approval of the revised methodology, management anticipates the potential issuance of approximately 1.2 million carbon credits over the applicable crediting period.

In December 2025, BCCPC and VNV amended the project agreement including capital payment schedules up to 2027, to better align with the agreed upon transition to Verra methodology VM0047. BCCPC agreed to an incremental $108 in payments to help facilitate the transition work to VM0047. Other than this, the quantum of payments was not changed, only the timing of payments.

Per the terms of the project agreement and assuming all condition precedents are met, BCCPC will invest aggregate capital of approximately $13.7 million into the project, of which BCCPC has invested $9,341 as of March 31, 2026. An estimated $6,000 of the total capital commitment is considered maintenance capital

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

base carbon

of which approximately $4,000 is expected to be funded through the sale of carbon credits generated by the project.

Following first carbon credit production, the India ARR Project will be the third project delivered by the Company, an achievement made under particularly challenging market conditions. The India ARR Project is expected to expand the Company's carbon credit production into the nature-based carbon removals category, where the majority of market liquidity and demand has been evolving in recent years. Base Carbon believes that demand for high-quality carbon removals projects will continue to accelerate, further validating its strategic focus in this area.

The Company holds two options to expand the India ARR Project, each for 10 million trees (20 million trees total), as well as a right of first refusal relating to an extension or expansion of the initial project, including any additional future phases of the initial project beyond the expected 20-year project life. If exercised and expansion payments are made, these options could materially scale the projects' investment scope and resulting volume of carbon credit production

i) Investment in India ARR Project

The table below summarizes the changes in the India ARR Project during the three months ended March 31, 2026, and the year ended December 31, 2025:

India ARR Project (thousands of US dollars)	March 31, 2026	December 31, 2025
Balance, beginning of the period	8,158	6,100
Capital deployed in the project during the period	1,183	2,058
Balance, end of the period	9,341	8,158

During the three months ended March 31, 2026, $1,183 of capital was deployed towards the project. This payment related to the ongoing validation, verification, and project maintenance activities.

During the year ended December 31, 2025, the Company deployed $2,058 in capital towards the India ARR Project, inclusive of $108 which was not part of the original agreement, and as such, does not form part of the remaining commitment below:

India ARR Project Capital Deployment (thousands of US dollars)	Amount
Committed capital deployment	13,621
Capital deployed in 2023	(4,400)
Capital deployed in 2024	(1,700)
Capital deployed in 2025	(1,950)
Capital deployed in 2026	(1,183)
Remaining capital deployment	4,388

As at March 31, 2026, the India ARR Project remains in the developmental stage, and no carbon credits have been issued. Therefore, the project's accounting methodology remained unchanged from the prior period, with fair value approximated by its cost basis as at March 31, 2026.

The project continues to advance toward first carbon credit issuance under Verra's VM0047 methodology, the latest high-integrity methodology for afforestation, reforestation, and revegetation projects, in addition to targeting Verra's ABACUS label. Backed by Amazon, the ABACUS label is believed to enhance carbon credit quality through additional requirements around dynamic additionality, transparency, and permanence.

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

base carbon

The project continues to progress as expected under the VM0047 timeline, advancing through field validation, monitoring and reporting, with first issuance expected in early 2027.

Results of Operations

The following are the consolidated results from operations, for the three months ended March 31, 2026, with comparison to the three months ended March 31, 2025.

Consolidated Financial Results

Results for the three months ended March 31, (thousands of US dollars)	2026	2025	$ Change	% Change
Realized cash settled gains on carbon credit revenue participation asset	1,170	-	1,170	100%
Realized cash settled gains on investments in carbon credit projects	-	790	(790)	(100%)
Total operating expenses	5,729	1,801	3,928	218%
Unrealized gains on investments in carbon credit projects	4,396	1,580	2,816	178%
Unrealized loss on carbon credit revenue participation asset	(1,175)	-	(1,175)	(100%)
Other income	253	-	253	100%
Income tax recovery (expense)	17	(204)	221	108%
Net and comprehensive (loss) income	(1,062)	518	(1,597)	(305%)

Gains and losses on investments in carbon credit projects

For the three months ended March 31, 2026, the Company generated $1,170 in realized cash settled gains on the RPA (2025 - $nil) and $nil (2025 - $790) in realized cash settled gains on investments in carbon credit projects. Unrealized gains on investments in carbon credit projects of $4,396 (2025 - $1,580) were recognized due to the movements previously described in "Project Updates and Details" and "Overall Financial Performance".

Operating Expenses

Base Carbon incurred $5,729 (Q1 2025 - $1,801) in total operating expenses during the three months ended March 31, 2026. The Q1 2026 operating expenses included $4,816 relating to the write-down of inventory in the first quarter primarily driven by the decrease in carbon credit price. The remaining Q1 2026 operating expenses of $888 decreased YoY when compared to $1,801 in Q1 2025.

The remaining operating expenses decreased YoY primarily due to:

Salaries and wages by $448, a decrease principally from a reduction in variable compensation in the current period.
Consulting and professional fees by $177, a decrease primarily as a result of a reduction in the use of external service providers.
General and administrate by $264, a decrease primarily due to cost saving measures and a reversal of a prior year-end estimate for related party marketing services.

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

base carbon

Net (loss) income

Base Carbon generated a net loss of $1,062 (2025 – $518 gain) during the three months ended March 31, 2026.

Basic and diluted (loss) earnings per share

As at March 31, 2026, the Company recorded basic and diluted (loss) per share of $0.01 (2025 - $0.00). The basic and diluted weighted average number of common shares outstanding were 101,829,095 (2025 – 108,727,826 and 109,034,368) respectively. Diluted earnings per share includes the effect of stock options that are in-the-money.

The Company also provides to investors valuable supplemental insights into the Company's financial performance in the form of basic and diluted adjusted comprehensive income (loss) per share. Refer to - Non-IFRS Financial Measures below for more information.

Summary of Quarterly Results

(in thousands of US dollars, except per share amounts)
	2026	2025				2024
	Q1	Q4	Q3	Q2	Q1	Q4	Q3	Q2
Realized cash settled gains on carbon credit revenue participation asset	1,170	-	-	-	-	-	-	-
Realized cash settled gains on investments in carbon credit projects		-	-	1,021	790	4,482	11,037	12,508
Gross (loss) on carbon credit sales	-	-	-	-	-	-	(79)	-
Total operating expenses	5,729	3,380	3,223	1,765	1,800	1,623	1,783	2,538
Operating (loss) income	(4,559)	(3,380)	(3,223)	(744)	(1,010)	2,859	9,175	9,970
Unrealized gains (losses) on investments in carbon credit projects	4,396	1,138	7,399	1,181	1,580	(15,419)	(8,876)	(1,838)
Unrealized (losses) on investments in revenue participation asset	(1,175)	(386)	-	-	-	-	-	-
(Loss) on Investments at fair value	-	-	-	-	-	(1,441)	-	(350)
Income tax recovery (expense)	17	227	(13)	(288)	(205)	(2,613)	(299)	(332)
Net (loss) income	(1,062)	(2,123)	1,612	239	518	(16,599)	33	7,470
Basic (loss) income per share	(0.01)	(0.02)	0.02	0.00	0.00	(0.15)	0.00	0.06
Diluted (loss) income per share	(0.01)	(0.02)	0.02	0.00	0.00	(0.15)	0.00	0.06
Adjusted comprehensive (loss) income for the period¹	(5,458)	(3,126)	(5,787)	(667)	(1,063)	261	8,937	9,658
Adjusted basic (loss) income per share¹	(0.05)	(0.03)	(0.06)	(0.01)	(0.01)	0.00	0.08	0.08
Adjusted diluted (loss) income per share¹	(0.05)	(0.03)	(0.05)	(0.01)	(0.01)	0.00	0.08	0.08

(1) "Adjusted Comprehensive (Loss) Income for the Period", including on per-share amounts, is a non-IFRS metric. For more information about this measure, why it is used by the Company, and a reconciliation to the most directly comparable measure under the IFRS Accounting Standards, refer to the section "Non-IFRS Financial Measures" of this document.

The Company has reported mixed results over the past eight quarters, with net losses recorded in three of the periods. These fluctuations reflect the variable nature and timing of carbon credit monetization. The Company received cash settlements from credit sales in six of the eight quarters.

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

base carbon

Carbon credit monetization is not guaranteed on a quarterly basis but rather based on timing of carbon credit issuances. Refer to "Project Updates and Details" for more information on the gains and losses on investments in carbon credit projects.

The adjusted comprehensive income over the eight quarters in aggregate was $2.3 million, showing strong performance for the Company, particularly in a developing industry.

Liquidity and Financial Position

As at March 31, 2026, the Company had working capital of $40.9 million, including cash of $2.9 million (December 31, 2025 – working capital of $39.9 million, including cash of $5.7 million).

During the three months ended March 31, 2026, the Company's cash decreased by $2.8 million. The decrease in cash as at March 31, 2026 was primarily due to $1.7 million in cash spent on operating activities, included in this amount is $1.2 million related to cash deployment into the India ARR Project, and an additional $1.3 million in cash used in financing activities for the repurchase of shares under the NCIB. This decrease is partially offset by $0.1 million net cash proceeds in investing activities relating to $0.4 million repayment of a secured debenture, netted against $0.3 million in fees and interest charged on the same secured debenture during the first quarter.

For the three months ended March 31, 2025, cash decreased by $1.4 million. The decrease in cash for the three months ended March 31, 2025, was primarily due to $0.7 million in cash spent on operating activities, $0.5 million cash invested in a secured debenture, and $0.2 million in cash used on repurchase of shares under the NCIB.

The Company's ability to meet its obligations and execute its business strategy depends on its ability to generate cash flow from the delivery and sale of carbon credits. Based on current cash balances, the Company believes it has access to sufficient resources to satisfy its commitments.

The Company has maintained operations without debt or alternative funding. However, there is no assurance that the Company will be able to access debt, equity or alternative funding at the times and in the amounts required to meet the Company's obligations and to fund activities.

While there has been action to encourage optimism about the state of both the voluntary and compliance carbon markets, such as the recent CORSIA announcements and auctions, there continue to be a number of geo-political threats and aggressions which cause the tempering of that optimism. Additionally, there is some uncertainty regarding global economic conditions, all of which impact the ability to finance operations if there are any liquidity issues.

Capital Resources

The Company's liquidity primarily consists of $2.9 million in cash and cash equivalents. The Company believes its net working capital balance, in addition to cash receipts from monetization of current carbon credit inventories are sufficient to fund current commitments for the next 12 months. These include investment in its revenue model, marketing expenditures to promote the growth of the business and exploring additional opportunities to create shareholder value. The Company may require additional funds for new commitments such as new carbon credit projects, for which the Company may raise funds through equity or debt financing. The Company has no long-term debt or material contractual payment obligations notwithstanding the India ARR Project capital commitments. The Company's working capital will be used for further business development.

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

Off-Balance Sheet Arrangements

There are currently no off-balance sheet arrangements which could influence current or future results or operations, or the financial condition of the Company.

Critical Accounting Estimates

The preparation of the consolidated financial statements requires management to make certain judgments, estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of income and expenses during the reporting period. Actual outcomes could differ from these estimates.

The consolidated financial statements include estimates that, by their nature, are uncertain. The impact of these estimates is pervasive throughout the consolidated financial statements and may require accounting adjustments based on future occurrences. Revisions to accounting estimates are recognized in the period in which the estimate is revised and future periods if the revision affects both current and future periods. These estimates are based on historical experience, current and future economic conditions and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

Judgements made in applying accounting policies that have the most significant effects on the amounts recognized in the consolidated financial statements are included in the following notes:

Accounting for investments in carbon credit projects – management assessed the contractual agreements to determine whether the investments in carbon credit projects are financial instruments and their classification and measurement
Accounting for carbon credit inventory – management assessed that the carbon credits from the Rwanda Cookstoves Project are to be valued at the lower of cost and net realizable value ("NRV"), as the Company is not a commodity broker trader. Management also applied judgment in determining the cost basis on receipt of carbon credits from investments in carbon credit projects and in determining that revenue share obligations are excluded from NRV.
Accounting for carbon credit revenue participation asset – management applied judgment in assessing the derecognition of the original investment and recognition of the carbon credit revenue participation asset as a financial asset measured at fair value, including the determination of fair value in accordance with IFRS 13 based on the Company's contractual entitlement to future cash flows.
Classification of investments in carbon credit projects as current or non-current – management applies judgment in determining whether investments in carbon credit projects are expected to be realized within twelve months of the reporting date. This assessment is based on the project's expected carbon credit issuance schedule, which is informed by the Project Design Document, approved monitoring reports, and subsequent updates to projected issuance timing. Where management expects carbon credits to be received and realized within twelve months, the investment is classified as current. Management reviews this assessment at each reporting date.

Information about assumptions and estimate uncertainties that have a significant risk of resulting in a material adjustment in the consolidated financial statements is included in the following notes:

Fair values of investments in carbon credit projects – management estimates the fair value using the cost approach or income approach depending on the stage of the investment in carbon credit project, with such carbon credit investment classified as a financial instrument, the fair value determined by either the cost or income approach is presented through profit or loss ("FVTPL").

The cost approach is a valuation technique where fair value approximates the cumulative cash spend at the period end and assessing that the cost per carbon credit has not fallen below the

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

base carbon

carbon credit price. Projects valued using the cost approach involve significant subjectivity and estimation uncertainty, including the carbon credit price assumption.

The income approach uses a discounted cash flow model, summing the future discounted after-tax cashflows generated over the life of the project to a current net present value. The model reflects market expectations based on key inputs and assumptions, namely the carbon credit price, carbon credit volume, and discount rates. Projects valued using the income approach involve significant subjectivity and estimation uncertainty, including assumptions related to the carbon credit price, carbon credit volume, and discount rates.

As part of the operational stage of a carbon project, the Company emphasizes the implementation of project management or oversight standards relating to measurement, reporting, verification and auditing to enhance the efficiencies and credibility of carbon credits.

With the exception of carbon credit market pricing inputs attained from a third-party pricing source, the valuation of the Company's projects is performed internally, with the India ARR Project using the cost approach, and the Vietnam Household Devices and Rwanda Cookstoves Projects valued by the income approach utilizing a "discounted cash flow" analysis.

Initial valuation is performed by the Company's Corporate Development Department, with subsequent assessment and review by the Company's Finance Department. Further review is performed by the Company executives, namely: The Company CEO, President and CFO. Personnel at each stage all possess the requisite qualifications and expertise. The Company believes it has all the necessary internal expertise to coordinate and perform the valuation.

Further oversight is provided by both the Audit Committee and Board of Directors, to whom details of projects are presented for review, and in the case of the Board of Directors, approval.

Regarding third-party involvement, the Company uses a third party to provide data to determine the carbon credit price assumption. The Finance Department reviews documentation provided by that third party to confirm that the pricing source is appropriate for use in the valuation of investments in carbon credit projects.

Carbon credit inventory – management determines the lower of cost and NRV of carbon credit inventory. Cost is established at the per-unit market price on the date of receipt. NRV is the estimated selling price in the ordinary course of business less the estimated costs necessary to make the sale (IAS 2.6). Where NRV falls below cost, an appropriate write-down is made. If there is a subsequent increase in NRV, reversals of previous write-downs are made. The selling price used in the NRV assessment is determined based on pricing inputs provided by a third-party pricing source. The revenue share arrangement costs under project agreements are excluded from NRV as management has determined that these represent a distribution of sale proceeds rather than a cost necessary to make the sale.

Non-IFRS Financial Measures

Adjusted Comprehensive (Loss) Income and Adjusted Basic and Diluted (Loss) Income per Share

The term "adjusted comprehensive (loss) income for the period", including per share amounts, in this MD&A is not a standardized financial measure under IFRS and therefore may not be comparable to similar measures presented by other companies where similar terminology is used. These non-IFRS financial measures should not be considered in isolation or as a substitute for measures of performance, cash flows and financial position as prepared in accordance with IFRS. Management believes that these non-IFRS financial measures, together with performance measures and measures prepared in accordance with IFRS

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

base carbon

financial measures, provide useful information to investors and shareholders in assessing the Company's liquidity and overall performance.

Under IFRS 13 Fair Value Measurement, Base Carbon's investments in carbon credit projects are classified as financial instruments and, as such, are revalued quarterly using a DCF methodology. This approach estimates the present value of future projected cash flows, based on key assumptions including carbon credit generation volumes, market pricing, and discount rates. These inputs are reviewed and updated on a quarterly basis, resulting in regular valuation changes. Such changes are reflected as unrealized gains or losses in the Condensed Interim Consolidated Statements of (Loss) Income and Comprehensive (Loss) Income, as well as in the Condensed Interim Consolidated Statements of Cash Flow.

Unrealized gain or loss adjustments are non-cash and reflect changes in valuation assumptions such as carbon credit volume and price forecasts, project timelines, and discount rates. They do not represent objective business performance or realized financial gains or losses. Accordingly, Base Carbon believes that an adjusted comprehensive (loss) income for the period provides a more accurate reflection of underlying operational performance for the period.

Adjusted comprehensive (loss) income for the period, including per share amounts, is calculated as comprehensive (loss) income for the period adjusted for items such as (i) the unrealized gains (losses) on investments in carbon credit projects, (ii) loss on investments at fair value, and (iii) unrealized gains (losses) on the RPA. Adjusted comprehensive (loss) income for the period is used by the company to monitor its results from operations for the period.

Basic and diluted adjusted comprehensive (loss) income per share have been calculated based on the adjusted comprehensive (loss) income attributable to common shareholders and the weighted average number of common shares outstanding. Diluted loss per share calculations do not consider the effect of stock options as their inclusion would be anti-dilutive. Diluted income per share calculations includes the effect of stock options that are in-the-money.

The following table reconciles comprehensive (loss) income to adjusted comprehensive (loss) income.

Adjusted Comprehensive (Loss) Income (thousands of US dollars, except per share amounts)	Three months ended March 31, 2026	Three months ended March 31, 2025
Comprehensive (loss) income for the period	(1,062)	518
(+) Unrealized (gains) on investments in carbon credit projects	(4,396)	(1,580)
Adjusted comprehensive (loss) for the period	(5,458)	(1,062)
-Adjusted on a basic per-share basis	(0.05)	(0.01)
-Adjusted on a diluted per-share basis	(0.05)	(0.01)

For the three months ended March 31, 2026, the Company recorded an adjusted comprehensive loss of $5,458 (2025 - $1,062 loss), representing a $4,396 decrease when compared to the same period in 2025.

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

base carbon

Capital Management

The Company manages its capital with the following objectives:

to ensure sufficient financial flexibility to achieve the ongoing business objectives including funding of future growth opportunities, and pursuit of accretive acquisitions; and
to maximize shareholder return through enhancing the share value.

The Company monitors its capital structure and adjusts according to market conditions in an effort to meet its objectives given the current outlook of the business and industry in general. The Company may manage its capital structure by issuing new shares, repurchasing outstanding shares, adjusting capital spending, or disposing of assets. The capital structure is reviewed by the Company's management and the Board of Directors on an ongoing basis.

The Company considers its capital to be shareholders' equity, being comprised of share capital, contributed surplus, and retained earnings, which as at March 31, 2026, totaled $98,225 (2025 - $100,491).

The Company manages capital through its financial and operational forecasting processes. The Company reviews its working capital and forecasts its future cash flows based on operating expenditures, and other investing and financing activities. There were no changes in the Company's approach to capital risk management during the three months ended March 31, 2026, and the Company is not subject to any externally imposed capital requirements.

Financial Risk Factors

Fair value

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurements are categorized into levels within a fair value hierarchy based on the nature of valuation inputs (Level 1, 2 or 3).

The fair value hierarchy has the following levels:

Level 1 – quoted prices represent unadjusted quoted prices for identical instruments exchanged in active markets.
Level 2 – significant other observable inputs includes directly or indirectly observable inputs, other than quoted prices for identical instruments exchanged in active markets.
Level 3 – significant unobservable inputs include inputs that are not based on observable market data.

The fair value of financial assets and financial liabilities are considered to be their carrying value when they are of short duration or when the instrument's interest rate approximates current observable market rates. The fair value of cash and cash equivalents, short term investment, related party receivable and other receivables approximate their carrying amounts due to the relatively short period to maturity.

Where other financial assets and financial liabilities are of longer duration, then fair value is determined using the discounted cash flow method using discount rates based on adjusted observable market rates.

The following table illustrates the classification of the Company's consolidated financial instruments within the fair value hierarchy as at March 31, 2026, according to the significance and reliability of the inputs used in determining fair value measurements. There were no transfers of assets between Level 1, Level 2 and Level 3 during the period. During the three months ended March 31, 2026, the Company received carbon credits from the Rwanda Cookstoves Project, resulting in a partial settlement of the Level 3 financial assets.

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

As at March 31, 2026 (thousands of US dollars)	Level 1	Level 2	Level 3	Total
Cash and cash equivalents	2,850	-	-	2,850
Short term investments	39	-	-	39
Related party receivable	-	-	-	-
Other receivables	234	-	-	234
Short term loan receivable	-	791	-	791
Investments at fair value	-	-	85	85
Current investments in carbon credit projects	-	-	16,944	16,944
Carbon credit revenue participation asset	-	-	3,326	3,326
Non-current investments in carbon credit projects	-	-	64,776	64,776
Accounts payable and accrued liabilities	(243)	-	-	(243)
	2,880	791	85,131	88,802

Credit Risk

Credit risk is the risk of financial loss to the Company if a customer or counter party to a financial instrument fails to meet its contractual obligations.

The Company's credit risk is attributable to cash and cash equivalents, short term investment, other receivables, prepaid and other assets, related party receivable, and investments in carbon credit projects. Cash and cash equivalents and short-term investments are on deposit with a Canadian chartered bank, from which management believes the risk of loss is remote. Other receivables are due from Canada Revenue Agency, from which management believes the risk of loss to be remote. The Company's maximum exposure to credit risk as at March 31, 2026 is the sum of the carrying value of the aforementioned asset accounts.

The Company manages credit risk of the aforementioned asset accounts by:

assessing credit profile and worthiness of, and completing due diligence on counterparties prior to agreements;
structuring agreements with defined services or benefits, terms, and remuneration, enforcing the Company's rights from such agreements; and
conducting post disbursement monitoring and executing dispute resolution processes.

Liquidity Risk

The Company's approach to managing liquidity risk is to ensure that it will have sufficient liquidity to meet liabilities when due, including commitments arising from investments in carbon credit projects. As at March 31, 2026, the Company had cash and cash equivalents balance of $2,850, short term receivable of $791, and other receivables of $234 for a total of $3,875 of liquid current assets to settle current liabilities of $280. The ability of the Company to receive cash from current investments in carbon credit projects is dependent on the timing of estimated carbon credit issuances and sales. All the Company's current financial liabilities have contractual maturities of less than 90 days and are subject to normal trade terms.

Market Risk

Market risk is the risk of loss that may arise from changes in market forces including, but not limited to, interest rates, equity prices, carbon credit prices, and foreign exchange.

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

base carbon

Foreign Currency Risk

As at March 31, 2026, the Company is exposed to foreign currency risk with respect to Canadian and Barbadian dollar assets with a total balance of $117 (December 2025 - $321). The Company is also exposed to predominantly Canadian and Barbadian dollar liabilities with a total balance of $7,881 (December 2025 - $8,445). Most of this exposure relates to the deferred tax liability amount totalling $7,591 (December 2025 – $7,612), which is the estimated income tax on future proceeds from the sale of carbon credits.

Sensitivity Analysis

The Company is exposed to foreign currency risk on fluctuations of financial instruments related to cash and cash equivalents, short term investments, other receivables, and accounts payable and accrued liabilities, and current and deferred tax liabilities.

As at March 31, 2026, the net income would have decreased by $86 had the United States and Barbados dollar strengthened by 5%. Had the US and Barbados dollar weakened by 5% at March 31, 2026, the net income would have increased by $86.

These changes are based on the results of foreign exchange gains/losses on translation of financial instruments related to cash and cash equivalents, investments, and accounts payable and accrued liabilities.

Related Party Transactions

Extension of the Expiry of Certain Outstanding Options

As approved by shareholders at the meeting of shareholder on February 6, 2026, the Company extended the expiry dates for certain outstanding stock options held by certain directors, officers, employees and consultants during the three months ended March 31, 2026. The modifications did not result in material incremental compensation expense.

Transactions with Abaxx Technologies Inc.

Abaxx Technologies Inc. ("Abaxx"), a related party to the Company, owned approximately 20.1% of the Company's outstanding shares as at March 31, 2026. Abaxx and the Company also have two common board of director members.

Abaxx Royalties

In September 2021, a technology, intellectual property and royalty agreement was executed between Abaxx and the Company, whereby the Company would owe a 2.5% royalty fee payment to Abaxx on Company revenue, including realized cash settled gains on investments in carbon credit projects.

During the three months ended March 31, 2026, the Company accrued $29 in royalty license fees for the realized cash settled gains on the RPA. For the three months ended March 31, 2025, the Company was invoiced and settled $20 in royalty license fees for the realized cash settled gains on investments in carbon credit projects.

Abaxx Marketing, Promotional and Consulting Services

For the three months ended March 31, 2026, the Company incurred no marketing, promotional, or consulting expenses from related party Abaxx. During the period, the Company recorded a recovery of $66 following the reversal of a prior year-end estimate for Abaxx marketing services, as it was determined no

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

base carbon

further obligation existed. For the three months ended March 31, 2025, the Company incurred $107 in fees from Abaxx for similar services.

Abaxx Loan

In September 2024, the Company issued an additional $1,000 unsecured loan to Abaxx. The loan originally matured on September 16, 2025, bearing an annualized interest rate of 9%, compounded monthly. Subsequent to maturity on September 16, 2025, the annualized interest rate increased to 15% on the amount of principal and interest outstanding.

In Q3 2025, Abaxx fully settled its obligations to the Company by offsetting $96 of marketing, promotional and consulting services and $45 royalty invoices described above. The remaining balance of $841 was settled in cash.

Loan interest income of $nil (2025 - $20) was recognized during the period ended March 31, 2026.

Abaxx Share Purchase Agreement

In December 2024, the Company and Abaxx entered into a share purchase and sale agreement whereby the Company agreed to purchase such number of common shares of the Company owned by Abaxx equal to the aggregate purchase price of $550 divided by the per share market value on closing, which was expected to occur in January 2025. The purchase price was paid to Abaxx in advance of closing during December 2024.

In January 2025, the Company and Abaxx amended the share purchase and sale agreement, whereby the Company agreed to purchase such number of common shares of the Company owned by Abaxx equal to the aggregate purchase price of $1,550 (inclusive of $550 from the December 2024 original agreement) divided by the per share market value on closing which was expected to occur in March 2025. The additional $1,000 purchase price was paid to Abaxx in advance of closing and the aggregate purchase price of $1,550 was subsequently returned to the Company in connection with the termination of the transaction by Abaxx in January 2025.

In connection with an extension of the termination provisions of the amended share purchase agreement, an extension fee of $75 was charged to Abaxx, which Abaxx paid upon termination of the agreement and the return of the $1,550 purchase price.

Commitments and Contractual Obligations

The following table summarizes commitments and contractual obligations for each of the next five years and thereafter:

Payments Due as at March 31, 2026 - by Period (thousands of US dollars)
Contractual Obligations	< 1 year	1 - 3 years	4 - 5 years	After 5 years	Total
India ARR Project	1,932	1,569	817	70	4,388
Total Contractual Obligations	1,932	1,569	817	70	4,388

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

base carbon

India ARR Project Payments

With respect to the India ARR Project, BCCPC has, subject to conditions and achievement of project milestones, contractual commitments to make aggregate payments totalling $13,729 in various tranches over the life of the project. As at March 31, 2026, the remaining contractual commitments are $4,388. These payments are anticipated to be due by October 2032, staged, partially funded by anticipated future carbon credit sales proceeds, and based on various conditions precedent / project milestones.

The Company had no other material contractual payment commitments as at March 31, 2026.

Subsequent Events

Government of Vietnam Decree

Subsequent to quarter-end, the Government of Vietnam issued the Decree, establishing a comprehensive regulatory framework formalizing the authorization and corresponding adjustment process under Article 6.2 of the Paris Agreement and the procedures by which carbon project developers may apply for government approval to transfer carbon credits to international counterparties with a "Corresponding Adjustment". The Decree also sets a maximum international transfer ratio of 90% for qualifying mitigation activities, with the remaining share retained to support domestic climate objectives.

Outstanding Share Capital Data

As of the date of this MD&A, the Company had 100,843,488 common shares issued and outstanding, and 8,860,000 options outstanding, each option exercisable for the purchase of one common share.

Disclosure Controls and Procedures

The Company's disclosure controls and procedures are designed to provide reasonable assurance that information is accumulated and communicated to the Company's management, including the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. As of March 31, 2026, the Company's management, with the participation of the Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of its disclosure controls and procedures, as defined by the Canadian securities regulatory authorities, and have concluded that the Company's control environment is effective.

Internal Control over Financial Reporting

Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting. These controls include policies and procedures that:

pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;
provide reasonable assurance that transactions are recorded as necessary to permit preparation of the consolidated financial statements in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board, and that receipts and expenditures are being made only in accordance with authorizations of management and directors of the Company; and
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company's assets that could have a material effect on the consolidated financial statements.

Base Carbon Inc.
Management's Discussion and Analysis
For the three months ended March 31, 2026
(Thousands of US Dollars, except as otherwise noted)

base carbon

All control systems contain inherent limitations, no matter how well designed. As a result, the Company's management acknowledges that its internal control over financial reporting will not prevent or detect all misstatements due to error or fraud. In addition, management's evaluation of controls can provide only reasonable, not absolute, assurance that all control issues that may result in material misstatements, if any, have been detected.

Refer to the Critical Accounting Estimates for further discussion on Internal Controls relating to valuation.

There have been no changes in the Company's internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting during the period ended March 31, 2026.

Additional Information

Additional information relating to the Company can be found on SEDAR at www.sedarplus.ca.

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Base Carbon — Management Reports 2026

48096_rns_2026-05-15_cf4c4a68-887e-4aef-9a13-9c67765b4f36.pdf

basecarbon

BASE CARBON INC.

Introduction

Use of Non-IFRS Financial Measures

Caution Regarding Forward-Looking Statements

General Business Description

Key Highlights

Overall Financial Performance

Realized Cash Settled Gains

Operating Expenses

Comprehensive (Loss) Income for the Period

Adjusted Comprehensive (Loss) Income for the Period

Basic and Diluted Loss per Share

Adjusted Basic and Diluted Loss per Share

Total Assets

Total Liabilities

Shareholder's Equity

Outlook

Project Summary

CORSIA Approved VMR006 Methodology and Vietnam Regulatory Update

CORSIA Approved VM0050 Methodology

Monetization of Carbon Credit Inventories

Organic Portfolio Expansion Opportunities

Robust and Diversified Growth Pipeline of Carbon Reduction and Removal Projects

Market Positioning and Strategic Focus

Ongoing Common Share Buybacks

Project Updates and Details

Rwanda Cookstoves Project

ii) Rwanda Cookstoves Project Inventory

iii) Carbon credit revenue participation asset

Vietnam Household Devices Project

i) Investment in Vietnam Household Devices Project

India Afforestation, Reforestation, and Revegetation (ARR) Project

i) Investment in India ARR Project

Results of Operations

Consolidated Financial Results

Gains and losses on investments in carbon credit projects

Operating Expenses

Net (loss) income

Basic and diluted (loss) earnings per share

Summary of Quarterly Results

Liquidity and Financial Position

Capital Resources

Off-Balance Sheet Arrangements

Critical Accounting Estimates

Non-IFRS Financial Measures

Adjusted Comprehensive (Loss) Income and Adjusted Basic and Diluted (Loss) Income per Share

Capital Management

Financial Risk Factors

Fair value

Credit Risk

Liquidity Risk

Market Risk

Foreign Currency Risk

Sensitivity Analysis

Related Party Transactions

Extension of the Expiry of Certain Outstanding Options

Transactions with Abaxx Technologies Inc.

Abaxx Royalties

Abaxx Marketing, Promotional and Consulting Services

Abaxx Loan

Abaxx Share Purchase Agreement

Commitments and Contractual Obligations

India ARR Project Payments

Subsequent Events

Government of Vietnam Decree

Outstanding Share Capital Data

Disclosure Controls and Procedures

Internal Control over Financial Reporting

Additional Information

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Base Carbon Management Reports 2026