C3 Metals Inc. — Management Reports 2021

Jan 29, 2021

C3 METALS INC. (Formerly Carube Copper Corp.) MANAGEMENT’S DISCUSSION AND ANALYSIS For the Three Month Period Ended November 30, 2020 (Information as at January 28, 2021 unless otherwise noted)

INTRODUCTION

The following provides management’s discussion and analysis of results of operations and financial condition for the three month periods ended November 30, 2020 and 2019. Management’s discussion and analysis (“MD&A”) was prepared by C3 Metals Inc. management and approved by the Board of Directors on January 28, 2021.

On July 31, 2020, the company changed its name to C3 Metals Inc. (referred to herein collectively with its subsidiaries as “C3 Metals” or the “Company”). Additionally, the Company’s ticker symbol on the TSX Venture Exchange (“TSX-V”) was changed to CCCM. On June 18, 2015, Miocene Resources Limited (“Miocene”) completed a reverse takeover with Carube Resources Inc. (“CRI”). On July 7, 2015, the Company commenced trading on the TSX-V under the former name Carube Copper Corp.

On February 26, 2020, the Company completed the acquisition of all of the issued and outstanding shares of Latin America Resource Group Limited (“LARG”) a private Canadian company located in Toronto, Ontario. LARG has a 100% wholly-owned Peruvian subsidiary named KA Oro S.A.C. (“KAO”) which holds a 100% beneficial interest in eight exploration concessions and has option agreements to earn up to a potential 100% beneficial interest in five additional concessions. These 13 concessions comprise the Jasperoide copper-gold project, located in the Andahuaylas-Yauri belt of Peru.

The consolidated financial statements include all of the assets, liabilities and expenses of C3 Metals Inc. and its wholly-owned subsidiaries, Carube Resources Inc., Carube Resources Jamaica Limited (“CRJL”), Rodinia Jamaica Limited (“RJL”), Latin America Resource Group Limited, and KA Oro S.A.C.

This MD&A should be read in conjunction with the Company’s condensed consolidated interim financial statements for the periods ended November 30, 2020 and 2019 which are prepared in accordance with International Financial Reporting Standards (“IFRS”). The following discussion and analysis should also be read in conjunction with the Company’s consolidated annual financial statements for the years ended August 31, 2020 and 2019, which are prepared in accordance with IFRS for annual financial statements. All figures are presented in Canadian dollars unless otherwise indicated.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This document may contain or refer to certain forward-looking statements relating but not limited to the Company’s expectations, intentions, plans and beliefs. Forward-looking information can often be identified by forward-looking words such as “anticipate”, “believe”, “expect”, “goal”, “plan”, “intend”, “estimate”, “may” and “will” or similar words suggesting future outcomes, or other expectations, beliefs, plans, objectives, assumptions, intentions or statements about future events or performance. Forwardlooking information may include reserve and resource estimates, estimates of future production, unit costs, costs of capital projects and timing of commencement of operations, and is based on current expectations that involve a number of business risks and uncertainties. Factors that could cause actual results to differ materially from any forward-looking statement include, but are not limited to, failure to establish estimated resources and reserves, the grade and recovery of ore which is mined varying from estimates, capital and

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operating costs varying significantly from estimates, delays in obtaining or failures to obtain required governmental, environmental or other project approvals, inflation, changes in exchange rates, fluctuations in commodity prices, delays in the development of projects, the failure to obtain sufficient funding for operating, capital and exploration requirements and other factors. Forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from expected results. Potential shareholders and prospective investors should be aware that these statements are subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from those suggested by the forward-looking statements. Shareholders are cautioned not to place undue reliance on forward-looking information. By its nature, forward-looking information involves numerous assumptions, inherent risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections and various future events will not occur. C3 Metals undertakes no obligation to update publicly or otherwise revise any forward-looking information whether as a result of new information, future events or other such factors which affect this information, except as required by law.

NATURE OF OPERATIONS AND DESCRIPTION OF BUSINESS

C3 Metals is an exploration stage junior mining company engaged in the identification, acquisition, evaluation and exploration of mineral properties focused on Peru and Jamaica as well as British Columbia and Nova Scotia in Canada. The Company has not determined whether its properties contain mineral resources that are economically recoverable. The recoverability of amounts recorded for mineral exploration properties and deferred exploration expenditures is dependent upon the discovery of economically recoverable resources, the ability of the Company to obtain the necessary financing to complete the development of these resources and upon attaining future profitable production from the properties or sufficient proceeds from disposition of the properties.

Peru

On February 26, 2020, the Company completed the acquisition of a 100% interest in LARG. LARG's subsidiary KAO holds a 100% beneficial interest in eight exploration concessions and has two option agreements to earn a majority interest in five additional concessions. These 13 concessions comprise the Jasperoide copper-gold project, located in the Andahuaylas-Yauri belt of Peru. The Jasperoide project concessions cover a total area of 5,696 hectares.

Jamaica

The Company's Jamaican properties are prospective for copper and gold. In Jamaica, the Company currently has 100% ownership of five licences covering 207 square kilometres in area. During August 2019, the Company concluded the sale of six non-core Jamaican licences to Geophysx Jamaica Ltd. (“Geophysx”). The Bellas Gate Project (“BGP”) which is comprised of the Bellas Gate and Browns Hall Special Exclusive Prospecting Licences (“SEPLs” or the “licences”) is the most advanced stage project, with porphyry and epithermal style copper, gold and silver mineralization.

The Company also holds a 100% interest in two of the Rodinia Jamaica licences known as Main Ridge and Hungry Gully within the Cretaceous Inliers of east-central Jamaica. Additionally, the Company holds a 100% interest in the Arthur’s Seat licence also located in the Central Inlier.

The most recent exploration in Jamaica has focused on the Main Ridge project with mapping and prospecting, a grid-based soil sampling program and follow-up rock channel sampling over the eastern area of the Main Ridge project.

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Nova Scotia

During April, 2019, the Company acquired, through staking, a 100% interest in four licences comprising the Stewart Brook Gold (“SBG”) project area covering over 46 sq. km. in Guysborough County, Nova Scotia.

British Columbia

The Rogers Creek and Mackenzie properties located in British Columbia, Canada are prospective for copper, gold and molybdenum. Together these properties consist of a total of 32 claims and cover 303 sq. km. in area.

During May 2018, the Company entered into an option earn-in agreement with Tocvan Ventures Corp. (“Tocvan”) who has a right to earn an 80% interest in the Rogers Creek project by spending $1,900,000 on exploration; payment of $25,000 cash; and the issuance of 1,300,000 Tocvan common shares over the initial four year earn-in period. Initial payments of $25,000 cash and 500,000 common shares were received during March 2019. During June 2020, the Company received an additional 200,000 common shares.

Details with respect to the Company’s property interests and exploration programs are described in the section Overall Performance and Results of Operations.

RECENT ACTIVITY HIGHLIGHTS

Private placement financing with Eight Capital

On January 19, 2021, the Company announced it had entered into an engagement letter with Eight Capital, under which Eight Capital, acting as lead agent for the Company on behalf of a syndicate of agents, has agreed to offer for sale up to 28,572,000 common shares of the Company on a best-efforts private placement basis at an issue price of $0.14 per common share, for aggregate gross proceeds of up to $4,000,080. On January 25, 2021, the Company announced an amended agreement with Eight Capital to increase the size of the private placement for sale of up to 46,429,000 common shares of the Company for aggregate gross proceeds of up to $6,500,060. The Company also granted the agents an overallotment option to distribute up to an additional 6,964,300 common shares at the issue price, exercisable in whole or in part at any time within 48 hours prior to the closing of the offering. If this option is exercised in full, an additional $975,002 will be raised and the aggregate proceeds of the offering would be $7,475,062. The agents will receive a cash commission of 7 percent of the gross proceeds of the offering, and compensation warrants in an amount equal to 7 percent of the number of common shares sold pursuant to the offering. Each compensation warrant will be exercisable to purchase one share at the issue price for a period of 12 months from the closing of the offering.

- Jasperoide, Peru Core resampling program

On January 15, 2021, the Company announced the completion of a core resampling program, which focussed on core from seven holes that were drilled by Hochschild in 2011 to 2012, totalling approximately 645 metres. The program was initiated to confirm the distribution and tenor of the skarn-hosted coppergold mineralization and to verify historic results for future resource calculations. Results from the program confirm both the successful verification of, and significant copper intercepts in, all seven historical holes.

Highlights include:

• There is a strong correlation between the spatial distribution of the mineralization and grades in comparison to the historical and 2020 resampled half core.

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• Broad intervals of strong copper and gold assays were verified in all historical drill holes, including: o JADD11-03 returned 136 m at 0.76 percent Cu and 0.35 gram per tonne Au (historical onehalf core);

• JADD11-03 returned 136 m at 0.75 percent Cu and 0.35 g/t Au (resampled one-half core).

• Significant zones of high-grade copper and gold assays were also verified, including:

• JADD11-04 returned 24 m at 2.96 percent Cu and 0.70 g/t Au (historical one-half core);

• o JADD11-04 returned 24 m at 2.76 percent Cu and 0.67 g/t Au (resampled one-half core).

The Company's phase 1 drilling program will commence as soon as the drill camp has been completed, which is well under way. The upcoming program comprises an initial 3,500 m in approximately 15 to 20 holes of 100 to 250 m depth, nominally on 50 m centres, and is designed to demonstrate lateral and vertical continuity of the high-grade copper-gold mineralization. Drilling will start in the south and move northward along the targeted contact between the intrusive complex and the Ferrobamba formation.

Executive appointments

On January 5, 2021, the Company announced the appointment of Kevin Tomlinson to the position of president and chief executive officer and as a director of the Company. Alec Rowlands is also joining the Company as vice-president of investor relations. Stephen Hughes, who has now returned to full-time employment following an illness, will step back from the CEO position and continue as vice-president, exploration, and remain a director of the Company.

Mr. Tomlinson is a Canadian/Australian structural geologist and investment banker with over 35 years experience in the exploration, development and financing of mining projects globally, and particularly the North American, Australasian and European capital markets. Mr. Tomlinson's diverse career commenced with 15 years in technical and senior exploration management roles predominantly at Plutonic Resources, followed by several years as the managing director and CEO of ASX-listed junior Austminex, and as head of research for Hartleys stockbroking in Australia.

For the past 20 years, Mr. Tomlinson has been a very effective resources investment banker, mergers and acquisitions adviser, and company director for some of the most successful junior exploration and development companies globally, including Centamin Plc., Orbis Gold, Medusa Mining, Cardinal Resources and Bellevue Gold.

As managing director of investment banking at Westwind Partners/Stifel Nicolaus from 2006 to 2012, Mr. Tomlinson was involved in many financings and listings for growing junior and mid-tier resource companies across the Toronto Stock Exchange, Australian Securities Exchange, London Stock Exchange and alternative investment markets, including Centamin, SolGold, Allied Gold and Trelawney.

Between 2015 to 2017, Mr. Tomlinson was a senior consultant to Maxit Capital, leading the merger of Gryphon Minerals with Teranga Gold and introducing SolGold to the firm as a corporate client. Mr. Tomlinson's most recent mergers and acquisitions role has been as chairman with Cardinal Resources during the delineation and development of its Tier 1, 5.1-million-ounce gold deposit in Ghana and the takeover of the company. Mr. Tomlinson is currently non-executive chairman of Bellevue Gold and nonexecutive director of Kodiak Copper.

Mr. Tomlinson holds a BSc (hons) and an MSc degree in structural geology and a graduate diploma in finance and investment from the Securities Institute of Australia. He is a fellow of the Chartered Institute

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for Securities and Investment (CISI), a liveryman for the Worshipful Company of International Bankers (U.K.) and a fellow of the Institute of Directors (U.K.).

Mr. Rowlands has over 25 years experience in mining finance. He is the former managing director of First Marathon Securities (London) and former head of sales for Gordon Capital (New York). Since 1999, Mr. Rowlands has held several senior finance positions, including with Yorkton Securities, Westwind Partners, Jennings Capital and PowerOne Capital Markets Ltd.

Mr. Rowlands has been an active investor and founding shareholder in several mining ventures, notably Auryx Gold, which was acquired by B2Gold for its Otjikoto project in Namibia in 2011. He is currently vice-president, investor relations and corporate development for Cardinal Resources Inc.

Director appointment

On December 1, 2020, the Company announced the appointment of Mr. Fernando Pickmann as a director of the Company effective December 1, 2020. Mr. Pickmann is a lawyer with over 20 years of corporate, securities and mining law experience. He holds a law degree, an LLM in corporate law and is currently a partner of Dentons law firm in Lima specializing in advising significant mining companies in Peru. Mr. Pickmann was a professor of mining law and strategic alliances at Lima University and has acted as internal legal adviser to the Peruvian government on the Mining Privatization Committee of Centromin, Peru. He has been a board member of PeruPetro (Peruvian agency for oil and gas), is a current director and the president of TSX-V listed Regulus Resources and a director of TSX-V listed Aldebaran Resources.

Jasperoide, Peru – Historical data review

On September 30, 2020, the Company announced it had completed a comprehensive review of all historical data for the Jasperoide porphyry-skarn district. Three high-priority areas for immediate follow-up of surface exploration and drilling have been identified as follows.

Montana de Cobre

• Extensive 1.5 kilometres of strong copper and gold mineralization hosted in massive magnetite and garnet-diopside skarns coincident with an intense geophysical magnetic high.

• Previous drilling intersected wide intervals of ore-grade copper-gold mineralization, which include:

• 185.2 metres at 1 percent Cu, 0.39 gram per tonne Au in JADD11-03 (from 22 m);

• 114.9 m at 0.97 percent Cu, 0.37 g/t Au in JADD12-03 (from 37.1 m);

  • including 34.5 m at 2.55 percent Cu, 0.69 g/t Au (from 103.5 m);

• 140.3 m at 3.54 percent Cu, 0.33 g/t Au in JADD11-10 (from 70 m);

  • including 24.3 m at 5.76 percent Cu, 0.1 g/t Au (from 86 m).

• Proximal diorite porphyry shows strong endoskarn and phyllic alteration with porphyry B- type veining.

• Mineralization remains open in all directions.

Cresta Verde

• Outcropping massive magnetite skarn-hosted copper-gold mineralization coincident with a strong magnetic anomaly extending north from Montana de Cobre.

• A single historical drill hole into the magnetic feature intersected 23.5 m at 1.86 percent Cu (JADD11-20 from 19 m).

• Three kilometres of untested strike potential for immediate stepout drilling.

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Callejon de Oro

• Strong magnetic anomaly extending for greater than 1.2 km to the southwest of Montana de Cobre.

• High-grade epithermal-style gold mineralization in trenches and soils.

• Results from trench 24 and a single drill hole, respectively, include: 11 m at 19.5 g/t Au and 1.23 m at 27.2 g/t Au (from 210.9 m).

• Target has been the subject of minimal scout drilling and remains highly prospective.

SELECTED INTERIM INFORMATION

The following table contains selected interim financial information for the three month periods ended November 30, 2020 and 2019.

November 30, 2020 and 2019.
	Three months ended November 30, 2020 $ (unaudited)	Three months ended November 30, 2019 $ (unaudited)
Revenue	Nil	Nil
Total expenses	(325,060)	(290,378)
Other income	48,956	31,969
Net loss for the period	(276,104)	(258,409)
Currency translationdifferences	(12,242)	(124,114)
Total comprehensive income (loss) for the period	(263,862)	(382,523)
Basic and diluted loss per common share	(0.00)	(0.00)
Cash dividends per common share	Nil	Nil

For the three month period ended November 30, 2020, total expenses before interest, other income and foreign exchange loss were $276,104 and were comprised of: $56,221 related to promotion and investor relations; $6,271 related to regulatory authority and transfer agent fees; $22,192 with respect to professional fees for legal, accounting and audit services; $238,964 with respect to office, general and administrative costs; and, $1,412 with respect to project generation and evaluation.

Total expenses (before other income and expenses) were $34,682 higher during the first quarter of fiscal 2021 when compared to the same quarter in fiscal 2020. Promotion and investor relations costs were higher by $43,530. Increased costs related to a new promotional campaign to increase investor awareness and to a new investor relations contractor. Regulatory and transfer agent fees were $1,414 higher. Professional fees were higher by $5,903 related to increased costs for legal and audit. Office, general and administrative costs were significantly higher by $147,619. Several factors resulted in higher administrative costs: senior management time shifted from project development activity in the prior year to general administration; a severance payment of $31,500 was paid to the Company’s former exploration manager; and, costs related to the recruiting the Company’s new Chief Executive Officer were incurred. Project generation and evaluation costs were significantly lower by $156,586 during the quarter due to the decrease in executive management and technical time, lower consulting costs and lower travel costs related to new project evaluation following the completion of the LARG acquisition in the prior year. Share based compensation expense was lower by $7,198 as all non-cash charges related prior stock option grants had been expensed in prior periods.

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Other income and expenses during the three month period ended November 30, 2020 totaled a net income amount of $48,956 (Q1 fiscal 2020 - $31,969). Interest income on cash balances during Q1 fiscal 2021 was $2,774. An unrealized gain on the Tocvan marketable securities of $52,500 was recorded during the three month period ended November 30, 2020. Foreign exchange losses on accounts payable and accruals totaled $6,318.

OVERALL PERFORMANCE AND RESULTS OF OPERATIONS

Mineral Exploration Properties and Deferred Exploration Expenditures

Jasperoide Project, Peru

Overview

On February 26, 2020, the Company completed the acquisition of a 100% interest in LARG. LARG's subsidiary KAO holds a 100% beneficial interest in eight exploration concessions and has two option agreements to earn a potential 100% beneficial interest in five additional concessions. These 13 concessions comprise the Jasperoide copper-gold project, located in the Andahuaylas-Yauri belt of Peru. The Jasperoide project concessions cover a total area of 5,696 hectares. For the five concessions under option agreements, the Company must incur a cumulative total of US$5 million (including a minimum of US$2,000,000 for La Bruja) in exploration (approx. US$2.3 million incurred to November 30, 2020 including LARG and KAO expenditures prior to the February 26, 2020 acquisition date) and provide a balance of US$1,820,000 in cash option payments as detailed below.

The Jasperoide copper-gold project, which is located in the highly prospective Andahuaylas-Yauri belt of Peru, host to several large producing copper-gold-molybdenum deposits and mines owned by major companies, including Las Bambas (MMG), Antapaccay (Glencore) and Constancia (Hudbay). The Jasperoide project hosts a number of copper-gold skarn and porphyry targets at various stages of exploration, with drilling by previous explorers intersecting intervals of copper-gold mineralization. The Company’s due diligence has also identified the potential for porphyry-style copper-gold mineralization.

La Bruja Option Agreement

Two concessions are subject to an option agreement with Inversiones La Bruja S.A.C. (“La Bruja”), where the Company can earn a 100% interest in the equity shares of La Bruja subject to minimum cumulative exploration expenditures of US$2,000,000 and total cash option payments of US$2,000,000. As at November 30, 2020, cash option payments totalling US$180,000 had been provided with a balance of US$1,820,000 outstanding. During June 2020, amending agreements to adjust the timing of cash option payments and exploration expenditure requirements were concluded. Future anniversary payments due by August 31 each year are as follows: 2021 – US$320,000; 2022 – US$500,000; and, 2023 – US$1,000,000.

As at November 30, 2020, a total of US$307,037 of cumulative exploration expenditures had been incurred with a balance of US$1,692,963 remaining to be incurred by August 31, 2023. Of that total, cumulative exploration expenditures of US$500,000 are required by August 31, 2021. Following the earn-in of a 100% interest in the concessions a net smelter return ("NSR") royalty of 1.5% would be payable to the former shareholders of La Bruja.

Ares Option Agreement

Three concessions are subject to an option agreement with Compania Minera Ares S.A.C. (“Ares”) where the Company has the right to earn an initial 51% interest in these concessions subject to incurring

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cumulative exploration expenditures of US$5,000,000, including certain administrative costs, by October 2023. As of November 30, 2020, a total of US$2,281,612 in expenditures had been incurred with an outstanding balance of US$2,718,388 remaining. The La Bruja concessions are located within an area of interest defined in the option agreement such that exploration expenditures of $307,037 incurred for the La Bruja concessions also qualify for the Ares earn-in.

Following the earn-in of a 51% interest in these mineral concessions, a new joint venture company is to be formed where the Company would hold an initial 51% equity interest and Ares would hold a 49% equity interest. Either party will then be required to co-fund their pro-rata share of ongoing exploration expenditures or would be subject to dilution. If either party were diluted to less than a 15% interest, their interest would convert to a 1.5% NSR royalty, with the other party then holding a 100% interest in the joint venture company. If the Company maintains greater than a 50% interest in the joint venture it would continue to be operator.

Jasperoide Project Property and Exploration Costs

The fair value of the common share and other consideration provided for the acquisition of LARG totaled $7,205,150 and was allocated to the fair value of net identifiable assets acquired. This resulted in a value of $7,540,390 being allocated to the acquired mineral exploration property assets for the Jasperoide project at the time of acquisition. During the three month period ended November 30, 2020, additional concession fees of $23,643 were incurred. As at November 30, 2020, the carrying value of the Jasperoide mineral property costs was $7,727,184.

During the three month period ended November 30, 2020, the Company incurred a total of $203,956 with respect to Jasperoide project exploration costs. Components of total costs comprised $15,129 relating to geology; $2,040 related to geophysics; $112,880 related to drill program planning and design, COVID-19 readiness and protocols and, camp construction; $56,711 relating to community and social development; and, $17,196 related to Peruvian IVA tax on these expenditures. As at November 30, 2020, the carrying value of the Jasperoide deferred exploration expenditures totals $451,034.

The Bellas Gate Project, Jamaica

Overview

The BGP is comprised of the Bellas Gate and Browns Hall SEPLs located within deformed, altered and mineralized Cretaceous rocks, primarily volcanics, within the Central Inlier of Jamaica. The licences are contiguous and cover 84 square kilometres in area. The Spaniards placer mined gold in the 16[th] century within the Central Inlier and high-grade copper veins were mined at two sites there in the mid-1800s. Subsequently, no significant exploration or development was undertaken until the 20[th] century when exploration was focused on copper. The BGP is subject to a 2% net smelter royalty (NSR) in favour of Clarendon Consolidated Minerals Ltd., the original vendor of the property. The Company’s exploration programs at the BGP are focused on defining copper and gold porphyry resources.

OZ Minerals Term Sheet and Definitive Agreement

During May 2013, the Company entered into a term sheet with OZ Minerals, with a definitive joint venture agreement concluded during May 2015. Significant terms included that OZ Minerals was required to incur staged exploration expenditures of $6.5 million and staged cash payments to the Company of $475,000 over a maximum period of 3.5 years to earn a 70% interest in the BGP. After completing the expenditures to earn a 70% interest, in February 2016, OZ Minerals elected to earn a further 10% interest by financing

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all work to the end of a feasibility study. In September 2016, OZ Minerals, for corporate reasons, elected to withdraw from the Bellas Gate Joint Venture.

During September 2016, the Company announced it had finalized a purchase agreement with OZ Minerals to acquire a 100% interest in OZ Minerals' holdings in Jamaica which include the 70% interest that OZ Minerals had earned in the BGP in addition to other property licences OZ Minerals had acquired in Jamaica.

Bellas Gate Project Property Costs

As at November 30, 2020, the Company had a capitalized balance of $1,745,591 (August 31, 2020 - $1,734,520) with respect to property costs for the BGP.

Bellas Gate Project Summary of Past Exploration Activity; 2011 to 2017

Year	Operator	Geophysics	Soil Sampling	Trenching	Drilling	Highlights
2011 and 2012	Carube Resources			800m	3,500m	Camel Hill: 170m of 0.32% Cu in drill hole CH12-01 and 207m of 0.27% Cu and 0.15 g/t Au in drill hole CH12-07
2013	Carube Resources		5,865 samples			15 new target areas defined by copper in soil anomalies including Provost, Hendley, MAB, Geo Hill and Coffee.
2014	OZ Minerals	1,867 line kms airborne mag and radiometrics.	1,887 samples		3,964m	Connors: 294m of 0.56% CuEq; including 96m of 1.00% CuEq, in drill hole DDH-CON-14-005
2015	OZ Minerals		1,095 samples		6,911m	Hendley: 261m @ 0.26% CuEq in drill hole HEN-15- 003
2016	OZ Minerals	46 km of IP			728m	Provost: 339m of 0.34% CuEq, including 10m of 1.79% CuEq in drill hole PVT-16-002
2017	Carube Copper				1,900m	Provost: 340.1m of 0.09 g/t Au and 0.20% Cu or 0.25% CuEq including 55.0m of 0.27 g/t Au and 0.35% Cu or 0.51% CuEq in PVT-004

Table 1: Summary of exploration activity from 2011 to 2017

Bellas Gate Project Exploration Expenditures

As at November 30, 2020, exploration expenditures incurred directly by the Company for the BGP have a total carrying value of $4,223,836 (August 31, 2020 - $4,184,863). These costs are comprised of the

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Company’s direct exploration expenditures and exclude any exploration previously funded previously by OZ Minerals. Costs incurred by the Company during the three month period ended November 30, 2020 total $23,359 and related to geology of $16,475; drilling related costs of $5,542; environmental costs of $1,060; and, health and safety costs of $282.

Rodinia and Other Licences, Jamaica

The Company retains a 100% interest in three licences in Jamaica including the Main Ridge, Hungry Gully and Arthur’s Seat licences. This is in addition to the Bellas Gate and Brown’s Hall licences, comprising the BGP.

Acquisition of Rodinia Jamaica Limited

On March 31, 2012, the Company completed the acquisition of a 100% interest in Rodinia Jamaica Limited (“RJL”) from Tigers Realm Metals Pty Limited (“TRM”) and Rodinia Resources Pty Limited (“Rodinia”). RJL held a 100% interest in four Special Exploration Prospecting Licences (“SEPLs” or “Rodinia Licences”), which total 184 sq. km. in area and which are known as Belvedere, Hungry Gully, Main Ridge and Mount Royal. The Belvedere and Mount Royal SEPLs are contiguous and are considered one project area known as the Above Rocks Project. Rodinia retains a 2% NSR in respect of the four licences.

Other Jamaica Projects acquired from OZ Minerals

During September 2016, the Company announced it had finalized a heads of agreement with OZ Minerals to acquire a 100% interest in OZ Minerals' holdings in Jamaica which, in addition to the 70% interest that OZ Minerals had earned in the BGP, included five licences covering 276 square kilometres which OZ Minerals had acquired directly in 2014. In April 2017, Carube received the official transfer documents from the Jamaican Ministry of Transportation and Mines for these five additional SEPLs. The licences include Arthurs Seat, Windsor Castle, Berkshire Hall, Mount Ogle and Shirley Castle. All licences have previously had airborne geophysics, which includes magnetics and radiometrics, flown over them by OZ Minerals. OZ Minerals undertook reconnaissance work at the Mammee Hill prospect on the Shirley Castle licence, conducting reconnaissance mapping, rock chip sampling and ridge and spur soil sampling for 298 samples.

The Company’s 100% interest in the five licences was subject to a single potential future payment to OZ Minerals of $1.5 million within one year of commencement of commercial production on any of the five licences. Each of the licences were subject to a 2% NSR with a buyback of one-half of the NSR for $500,000. During May 2019, the Company completed amendments to the agreement with OZ Minerals to: (i) waive the $1.5 million payment within one year of commencement of commercial production if the mineral product is less than 10,000 tonnes per annum; and, (ii) reduce the 2% NSR to a 1% NSR with a buyback of one-half for $250,000 on any of the SEPLs.

Agreement for Sale of Six Jamaican Exploration Licences

On June 19, 2019, the Company announced an agreement with Geophysx Jamaica Ltd. (“Geophysx”), pursuant to which Geophysx has acquired six of the Company's SEPLs located in Jamaica including four of the SEPLs previously acquired from OZ Minerals and two of the Rodinia SEPLs. The SEPLs contain early-stage copper-gold exploration projects and include the Belvedere, Mount Royal, Mount Ogle, Berkshire Hall, Windsor Castle and Shirley Castle SEPLs.

Pursuant to this agreement, Geophysx acquired a 100% interest in each of the projects for total cash of $277,605 (US$210,000). The Company retains a NSR royalty of 1% on four of these SEPLs. Geophysx will have the right to buy down the first half of the NSR for US$50,000 per each 0.1% of the NSR (total of

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US$250,000) and the second half of the NSR for US$70,000 per each 0.1% of the NSR (total of US$350,000). Geophysx would make future cash payments to the Company at milestones following commencement of commercial production that could total US$240,000.

Main Ridge and Hungry Gully Exploration Activity 2015 to Date

Soil geochemistry surveys were completed on the two licences during 2014 and 2015. At Main Ridge, a one-kilometre long segment in the southwestern part of the licence was characterized by anomalous copper values of 250 to 664 ppm copper and gold values of up to 33 ppb.

There are two highly prospective targets at Main Ridge, including:

• the Main Ridge Gold Zone (MRGZ) as defined by gold in soils, an airborne potassium anomaly and distinct structures extends over two kilometres to the west-northwest of the former Pennants gold mine.

• • the Orange Hill Copper Prospect (OHCP) is located on the western part of Main Ridge and is characterized by a large magnetic feature coincident with the copper-gold in soil anomalies.

During 2018, additional mapping and sampling focused on the Main Ridge Gold Zone where results show gold mineralization associated with structural trends hosting quartz, carbonate and adularia veins. Gold mineralization is associated with the low angle northwest striking structure, along dilational jogs developed at the intersection of the low angle northwest structures and cross cutting steeply dipping northeast structures. The width of mapped low angle structures is variable, but locally up to 10 metres in apparent thickness. Results include: 19.3 g/t gold at Mango Valley, 12.0 g/t gold at Donkey Hill and 1.7 g/t gold at Silver Fish which are three newly identified showings within the MRGZ.

During October and November 2018, the Company announced additional positive results from its surface exploration program at the Main Ridge project. A grid-based soil sampling program extended the strike length of the coherent zone of strong gold in soils to 5,500 metres, parallel to the trend of the Bennet Gold Zone (BGZ). Results to date validate the exploration team's interpretation that the gold-bearing quartzadularia-rhodochrosite veins extend northwest and southeast of the former Pennants gold mine. Mapping, sampling and trenching will continue west and east of the former Pennants mine, to define the structural controls on gold mineralization and define the source of high copper in soils within the project area.

During January 2019, the Company announced assay results from soil and rock sampling over the eastern area of the Main Ridge project. The mapping and prospecting, grid-based soil sampling program and follow-up rock channel sampling have identified high-grade copper-silver mineralization along the Rio Minho Valley, located immediately northeast of and parallel to the BGZ. Highlights of rock channel sampling results include:

• Channel sampling at the Cobre Verde prospect returned:

• 16.0 metres at 1.22 percent copper plus 7.8 g/t silver;

• Including 8.0 m at 1.61 percent copper plus 10.5 g/t silver;

• Including 4.0 m at 2.21 percent copper plus 15.8 g/t silver;

• Channel sampling at the Lime Valley prospect returned:

• 2.0 m at 6.07 percent copper plus 19.4 g/t silver;

• o 2.0 m at 1.92 percent copper plus 8.1 g/t silver;

• Channel sampling at the Trout Hall prospect returned:

• 6.0 m at 2.0 percent copper, 6.0 m at 1.6 percent copper.

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Rodinia and Other Licences Acquisition Costs

As at November 30, 2020, total property costs for the Rodinia and other licences have a carrying value of $880,974 (August 31, 2020 - $869,683). Licence renewal fees were $251 during the three month period ended November 30, 2020.

Rodinia and Other Licences Exploration Expenditures

As at November 30, 2020, the carrying value of exploration costs for the Rodinia and Other Licences totals $627,154 (August 31, 2020 - $623,335). During the three month period ended November 30, 2020, the Company incurred total costs of $2,304 related to geology work primarily at Main Ridge.

Stewart Brook Gold, Nova Scotia, Canada

During April, 2019, the Company acquired, through staking, a 100% interest in four licences comprising the Stewart Brook Gold (“SBG”) project area covering over 46 sq. km. in Guysborough County, Nova Scotia. The SBG project area was staked because it shows district-scale exploration potential for saddle reef and vein-style gold mineralization. Property highlights include:

• Located along strike of Atlantic Gold's Cochrane Hill deposit;

• Large gold-in-till anomaly defined, measuring 8,000 metres by 4,000 metres;

• Three historical gold districts located within five kilometres;

• Mapped anticline and synclines with cross-cutting faults; and,

• Excellent infrastructure, access and investor-friendly jurisdiction.

During May 2019, the Company commenced a till sampling program at SBG. The results of this initial exploration program were announced on July 18, 2019. Highlights of these results include: (i) anomalous gold values in 13 of the 22 samples collected; (ii) confirmation of the 8,000-metre by 4,000-metre gold-intill anomaly defined by historic work conducted in the 1980s with up to 222 ppb Au in till; (iii) sampling to the south and west identified a new 1,240 ppb Au in till anomalous sample; and (iv) completed north-tosouth till sample lines for gold grain analysis and determined potential travel distance.

The historic till and soil geochemical surveys over the SBG area was undertaken by Seabright Resources Inc. in the late 1980's, which defined an 8,000m by 4,000m gold in till anomaly. Seabright's till sampling program was very successful in defining highly anomalous gold in the Stewart Brook area. Of the 169 historic samples taken in the vicinity of the Stewart Brook Gold project, gold in till values ranged from nil to 7,000 ppb Au, with a mean value of 195.6 ppb Au and a median value of 7 ppb Au. These historic results have now been verified by the Company's recent till sampling program, which yielded 13 till samples with visible gold that assayed from 4 to 222 calculated ppb Au in Heavy Mineral Concentrate (HMC).

A new gold in till anomaly was also identified in a single isolated sample (with no samples within one kilometre) along the southwestern border of the SBG project. The lone till sample returned 1,240 calculated ppb gold and was collected less than a kilometre east-northeast from the Country Harbour Gold District. Anticline and syncline structures mapped to the west of Country Harbour are interpreted to extend onto the SBG project area based on the early mapping work of geologist E.R. Faribault.

In total, 22 till samples were extracted, inspected and analyzed. Till samples were sent to Overburden Drilling Management located in Ottawa, Ontario, where gold grains were separated from the heavy mineral concentrates and counted, measured and classified. Till data provided important information regarding potential distance of glacial transport, and more importantly proximity to bedrock.

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No additional costs were incurred with respect to SBG exploration costs during the three month period ended November 30, 2020. As at November 30, 2020, the carrying value of exploration costs totals $37,195.

Potential next phases of exploration work will focus on the "up-ice" priority areas and will include ground geophysics, prospecting and mapping, and drilling, if warranted. Expansion and refinement of the gold target will occur as new results and interpretations are completed.

– British Columbia, Canada Properties Rogers Creek and Mackenzie

The Rogers Creek and Mackenzie Projects were acquired with the reverse takeover of Miocene. As at November 30, 2020 property costs total $3,179,850 (August 31, 2020 - $3,179,850). During March 2019, the Company received a cash payment of $25,000 and a share payment valued at $50,000 from Tocvan Ventures Corp. related to the option agreement for the Rogers Creek property (see below). During June 2020, the Company received a first anniversary share payment valued at $50,000 from Tocvan. These amounts were offset against prior project acquisition costs.

During the three month period ended November 30, 2020, the Company incurred a total of $1,575 in exploration costs for the Mackenzie project including geology costs of $600 and geochemical costs of $975.

Rogers Creek

The Rogers Creek copper-gold property is located in southwestern British Columbia, near the town of Pemberton. The property now consists of 23 mining claims covering 212 square kilometres. The property is currently 100% owned subject to an underlying 2.5% NSR, which is payable upon production, half of which could be purchased for $1.25 million. The property is located in an easily accessible area with excellent infrastructure including a major power line, which crosses the western side of the property, and an extensive logging road network.

During May 2018, the Company entered into an option earn-in agreement with Tocvan Ventures Corp. who have a right to earn an 80% interest in the Rogers Creek project by spending $1,900,000 on exploration; payment of $25,000 cash; and the issuance of 1,300,000 Tocvan common shares over the initial four year earn-in period. Initial payments of $25,000 cash and 500,000 common shares were received during March 2019 following the Canadian Securities Exchange's approval of Tocvan's going public transaction. During June 2020, the company received the first anniversary payment of 200,000 common shares. Following the successful completion of the earn-in, an 80% / 20% joint venture will be formed where the Company would retain a 20% interest in the project subject to funding future pro-rata expenditures. A 3% NSR royalty is payable by Tocvan to the Company with advance royalty payments of $50,000 per year after Tocvan has earned its 80% interest.

Tocvan is now operating exploration programs at the Rogers Creek property. During the 2019 field season a rock sampling program and induced polarization geophysical survey were completed. Due to COVID19, a contemplated diamond drilling program was postponed until 2021.

Four target areas within the Miocene age Rogers Creek Pluton have been identified on Rogers Creek, based on geophysics, geochemistry, and the presence of alteration and/or mineralization. Exploration work has identified a six by two kilometre area of widespread propylitic alteration, localized copper-gold mineralization and multi-element soil anomalies, including copper, gold and molybdenum.

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Mackenzie

The Mackenzie copper-gold property is located in southwestern British Columbia, approximately 100 kilometres west of Lillooet, the nearest population centre, a railhead, source of high-tension power and major roads. Forest service access roads cross the northern and southern claim boundaries and link the property with the town of Gold Bridge, which is located about 40 kilometres to the east.

Mackenzie now consists of nine mining claims covering approximately 91 square kilometres. The British Columbia Government in response to COVID-19, has issued a blanket Time Extension Order for all claims. For the Mackenzie project, assessment work is due before December 31, 2021.

Four of the nine claims that make up the Mackenzie Project are subject to a 2% NSR in favour of the original vendor of the claims. This royalty does not extend to the western half of the Mackenzie property that includes the Bornite Trend where narrow quartz-chalcopyrite-bornite veins were found over a broad area. The Company has the right to buy-back 62.5% of the NSR for the purchase price of $1,000,000 (adjusted for CPI) with an additional right of first refusal for the remaining 37.5% of the NSR should the original vendor decide to sell all or any part of his interest in the NSR. Additionally, a 1.75% NSR royalty on the Mackenzie property was granted to Wallbridge Mining Company Ltd. ("Wallbridge") in connection with Miocene's prior line of credit arrangements with Wallbridge. The Wallbridge NSR can be repurchased for $1,750,000.

During August 2019, the Company announced that it had completed a mapping and sampling program at the Mackenzie Project. Previous work has identified three copper-bearing trends across the 91 sq. km. project area. The 2019 exploration program focused on two of the areas, namely the Bornite trend and the Breccia trend prospects. At the Breccia trend, broad zones of gossanous and silicified rock have been identified over a 1,200-metre by 600 m area; copper staining was observed in multiple outcrops; and, host rock is a breccia cut by sheeted and quartz stockwork veins. At the Bornite trend, bornite and chalcopyrite mineralization is hosted by planar and quartz stockwork veins and vein-style mineralization has been defined along a 7.5 km strike length.

From 2012 to 2015, work included mapping and sampling at the Tillworth Trend, Bornite Trend and the Breccia Trend. At the Bornite Trend, copper values ranged up to a maximum of 4.34% Cu with Au ranged from 0.001 to 0.445 g/t; and Ag from 3.34 to 4,170 g/t. Mineralization is located approximately ten kilometres south of Amarc Resource’s IKE deposit.

During September 2015, a high resolution airborne magnetic and radiometric survey, which covered a 57 square kilometre area and included the Bornite Trend, was completed on the Mackenzie Project.

Several important characteristics of the area are revealed from interpretation of the airborne magnetic and radiometric data:

• Elevated values in the potassium radiometrics suggesting a potassic alteration zone associated with porphyry mineralization occurs over an area at least 6km long by 3km at its widest point within and parallel to the contact of the Bridge River Pluton.

• A large magnetic body — about 2,000m long by 500m wide and 150m below surface — lies directly beneath high copper values on surface in grab samples. Previous mapping and sampling indicate a strong association between copper mineralization and magnetite.

• Interpreted structural zones coincide well with surface exposures of mineralization that parallel the Bridge River Pluton contact. Cross structures also show magnetic enhancement and correlation with copper in grab samples.

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In September 2016, a sampling program was focussed on the higher magnetic zones identified at the Bornite Trend. These sample results indicate three zones of anomalous copper in soil along the edge of the potassic altered intrusive.

All technical information within this document has been reviewed and approved by Stephen Hughes, P.Geo., an officer and director of the Company in his capacity as a qualified person as defined under National Instrument 43-101.

Results of Operations

Expenses

For the three month period ended November 30, 2020, total expenses (before other income and expenses) were $325,060 and were comprised of: $56,221 related to promotion and investor relations; $6,271 related to regulatory authority and transfer agent fees; $22,192 with respect to professional fees for legal, accounting and audit services; $238,964 with respect to office, general and administrative costs; and, $1,412 with respect to project generation and evaluation.

Total expenses (before other income and expenses) were $34,682 higher during the first quarter of fiscal 2021 when compared to the same quarter in fiscal 2020. Promotion and investor relations costs were higher by $43,530. Increased costs related to a new promotional campaign to increase investor awareness and to a new investor relations contractor. Regulatory and transfer agent fees were $1,414 higher. Professional fees were higher by $5,903 related to increased costs for legal and audit. Office, general and administrative costs were significantly higher by $147,619. Several factors resulted in higher administrative costs: senior management time shifted from project development activity in the prior year to general administration; a severance payment of $31,500 was paid to the Company’s former exploration manager; and, costs related to the recruiting the Company’s new Chief Executive Officer were incurred. Project generation and evaluation costs were significantly lower by $156,586 during the quarter due to the decrease in executive management and technical time, lower consulting costs and lower travel costs related to new project evaluation following the completion of the LARG acquisition in the prior year. Share based compensation expense was lower by $7,198 as all non-cash charges related prior stock option grants had been expensed in prior periods.

Other Income and Expense

Other income and expenses during the three month period ended November 30, 2020 totaled a net income amount of $48,956 (Q1 fiscal 2020 - $31,969). Interest income on cash balances during Q1 fiscal 2021 was $2,774. An unrealized gain on the Tocvan marketable securities of $52,500 was recorded during the three month period ended November 30, 2020. Foreign exchange losses on accounts payable and accruals totaled $6,318.

Net Loss and Loss per Common Share

For the three month period ended November 30, 2020, net loss was $276,104 (Q1 fiscal 2020 – $258,409). Basic and diluted loss per common share was $0.00 (Q1 fiscal 2020 – $0.00). As the Company incurred a net loss for each of these periods, the diluted number of common shares outstanding excludes all contingently issuable shares as they have an anti-dilutive effect for the periods presented.

Other Comprehensive Income (Loss)

Upon consolidation, the financial statements of the Jamaican subsidiaries (CRJL and RJL) and Peruvian subsidiary (KAO) are translated into Canadian dollars as follows: assets and liabilities - at the closing rate

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at the date of the statement of financial position, and income and expenses - at the average rate for the period. All resulting foreign exchange translation adjustments are recognized in other comprehensive income (loss). During the three month period ended November 30, 2020 a foreign currency translation gain of $12,242 (Q1 fiscal 2020 – loss of $124,114) was recorded in other comprehensive income.

LIQUIDITY AND CAPITAL RESOURCES

As at November 30, 2020, the Company held cash and cash equivalents of $2,377,080 (August 31, 2020 – $3,235,301) and had working capital of $2,573,147 (August 31, 2020 – $3,104,258). The Company has financed its operations primarily with equity financing.

Subsequent to quarter end, on January 19, 2021, the Company announced it had entered into an engagement letter with Eight Capital, under which Eight Capital, acting as lead agent for the Company on behalf of a syndicate of agents, has agreed to offer for sale up to 28,572,000 common shares of the Company on a bestefforts private placement basis at an issue price of $0.14 per common share, for aggregate gross proceeds of up to $4,000,080. On January 25, 2021, the Company announced an amended agreement with Eight Capital to increase the size of the private placement for sale of up to 46,429,000 common shares of the Company for aggregate gross proceeds of up to $6,500,060. The Company also granted the agents an overallotment option to distribute up to an additional 6,964,300 common shares at the issue price, exercisable in whole or in part at any time within 48 hours prior to the closing of the offering. If this option is exercised in full, an additional $975,002 will be raised and the aggregate proceeds of the offering would be $7,475,062. The agents will receive a cash commission of 7 percent of the gross proceeds of the offering, and compensation warrants in an amount equal to 7 percent of the number of common shares sold pursuant to the offering. Each compensation warrant will be exercisable to purchase one share at the issue price for a period of 12 months from the closing of the offering.

Financing activity during fiscal 2020

On August 26, 2020, the Company closed a private placement financing with the issuance of 43,636,381 common shares at a price of $0.055 per common share raising gross proceeds of $2,400,001. In connection with this financing, the Company paid cash commissions of $108,319 and issued 1,755,000 compensation options to finders. Each compensation option entitles the holder to purchase a common share at a price of $0.055 per share until their expiry date on August 26, 2022.

On January 17, 2020, the Company closed a private placement financing with the issuance of 50,100,000 common shares at a price of $0.05 per common share raising gross proceeds of $2,505,000. In connection with this financing, the Company paid cash commissions of $49,860 and issued 997,200 finder's warrants. Each finder's warrant entitles the holder to purchase a common share at a price of $0.05 per share until their expiry date on January 18, 2022.

During September 2019, the Company completed a private placement financing raising total gross proceeds of $260,000 with the issuance of 5,200,000 units. Each unit was comprised of one common share of the Company and one common share purchase warrant. Each warrant is exercisable at $0.08 per share until their expiry date on September 4, 2022.

The Company will require additional funding to be able to acquire, advance and retain mineral exploration property interests and to meet ongoing requirements for general operations. The ability of the Company to continue as a going concern is dependent on its ability to raise required financing whether through equity

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or debt financing; through joint ventures; the generation of profits from operations; or, the sale of property assets in the future.

The Company continues to seek joint venture funding for its exploration projects and has ongoing discussions with a number of companies.

Contractual Obligations

The Company does not have any fixed contractual obligations or commitments for capital or operating leases, purchase obligations or other long-term commitments. Any commitments under exploration option agreements are cancellable at the Company’s option but would result in forfeiture of rights under such agreements.

OUTSTANDING SHARE DATA

Information with respect to outstanding common shares, warrants, compensation options, compensation option warrants, stock options, restricted share units and deferred share units as at January 28, 2021, November 30, 2020 and August 31, 2020 is as follows:

	January 28, 2021	November 30, 2020	August 31, 2020
Common shares	376,579,811	375,168,311	375,168,311
Warrants	28,842,250	29,229,750	29,229,750
Compensation options	2,728,200	2,752,200	2,752,200
Stock options	35,705,000	28,705,000	28,705,000
Restricted share units (RSUs)	1,500,000	-	-
Deferred share units (DSUs)	1,551,694	1,551,694	1,551,694
Fully diluted shares outstanding	446,906,955	437,406,955	437,406,955

On January 5, 2021, the Company granted a total of 8,000,000 stock options to directors, officers, employees and consultants of the Company. These stock options are exercisable at $0.11 per share and expire on January 5, 2026. Additionally, on January 5, 2021, the Company granted 1,500,000 RSUs to a Company director.

During January 2021, a total of 387,500 warrants were exercised for proceeds of $38,750; 1,000,000 stock options were exercised for proceeds of $80,000; and, 24,000 compensation options were exercised for proceeds of $1,200.

OFF-BALANCE SHEET ARRANGEMENTS

The Company has not entered into any material off-balance sheet arrangements such as guarantee contracts, contingent interests in assets transferred to unconsolidated entities, derivative instrument obligations, or with respect to any obligations under a variable interest entity arrangement.

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FINANCIAL INSTRUMENTS AND RISK MANAGEMENT

The Company’s financial instruments consist of cash and cash equivalents, restricted deposits, marketable securities, accounts payable and accrued liabilities. Details relating to financial instruments and risk management associated with credit risk, liquidity risk, currency risk and interest rate risk are disclosed in note 14 to the annual consolidated financial statements for the years ended August 31, 2020 and 2019.

PROPOSED TRANSACTIONS

The Company periodically reviews potential merger, acquisition, investment and joint venture transactions and opportunities that could enhance shareholder value. The Company continues to evaluate such opportunities.

RELATED PARTY TRANSACTIONS AND COMPENSATION OF KEY MANAGEMENT

The Company has contracts for management and geological services with its officers, directors and companies controlled by its officers and directors. Key management includes all persons named or performing the duties of Chief Executive Officer and President, Chief Financial Officer, Vice President, Business Development and Director. Compensation awarded to key management for the three month periods ended November 30, 2020 and 2019 is set out in the note 10 to the unaudited interim condensed consolidated financial statements.

The Company has management service agreements with each of its President and Chief Executive Officer, Vice President, Business Development and Chief Financial Officer which provide for a payment upon termination without cause. These payments are equivalent to 3 months' compensation for each of these individuals. The service agreements also provide that under certain conditions, including a change in control of the Company, that each of these individuals would be entitled to a lump sum payment equivalent to 6 months' compensation irrespective of whether their services were retained subsequent to the change in control.

CRITICAL ACCOUNTING ESTIMATES

The preparation of financial statements in accordance with IFRS requires management to make estimates and assumptions that affect the amounts reported in the financial statements and disclosures in the notes thereto. These estimates and assumptions are based on management’s best knowledge of current events and actions that the Company may undertake in the future. Actual results may differ from those estimates. The most significant items requiring the use of management estimates and valuation assumptions are related to the recoverable value of mineral exploration properties and deferred exploration expenditures; the valuation of equity instruments including warrants, compensation options and stock options; and, the ability of the Company to continue as a going concern.

Details with respect to critical accounting estimates, judgments and estimation uncertainties are disclosed in note 3 to the annual consolidated financial statements for the years ended August 31, 2020 and 2019.

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NEW ACCOUNTING STANDARDS

New and revised accounting standards, the timing of their adoption and the impact of these new standards on the Company’s financial statements is discussed in note 3 to the unaudited interim condensed consolidated financial statements for the three month periods ended November 30, 2020 and 2019.

RISKS AND UNCERTAINTIES

The Company is subject to a number of risks and uncertainties due to the nature of its business and the present stage of development of its business. Investment in the natural resource industry in general, and the exploration and development sector in particular, involves a great deal of risk and uncertainty. Current and potential investors should give special consideration to the risk factors involved. These factors are discussed more fully in the annual Management’s Discussion and Analysis dated December 8, 2020 which is filed on SEDAR.

Global COVID-19 Pandemic

The outbreak of COVID-19 has resulted in governments worldwide enacting emergency measures to combat the spread of the virus. Measures taken to contain the spread of the virus, including travel bans, quarantines, social distancing, and closures of non-essential services have triggered significant disruptions to businesses worldwide, resulting in an economic slowdown. The duration and impact of the COVID-19 pandemic is unclear at this time and as a result it is not possible for management to estimate the severity of the impact it may have on the financial results and operations of the Company in future periods. COVID19 may hinder both the Company’s ability to conduct exploration activities in the jurisdictions that it operates in and its ability to raise financing for exploration or operating costs due to uncertain capital markets, supply chain disruptions, increased government regulations and other unanticipated factors, all of which may also negatively impact the Company’s business and financial condition. It is management’s assumption that the Company will continue to operate as a going concern.

CORPORATE INFORMATION

Officers and Directors

Kevin Tomlinson, B.Sc. (Hons.), M.Sc., FCISI – Chief Executive Officer and President and Director Stephen Hughes, B.Sc. (Hons.), APGNS (P. Geo.), MAIG, FSEG – Vice-President, Exploration and Director Jeffrey Ackert, B.Sc. – Vice President, Business Development John McNeice, B. Comm. (Hons.), CA, CPA – Chief Financial Officer Alec Rowlands – Vice President, Investor Relations Chris Irwin, BA, LLB – Corporate Secretary Antony Manini, B.Sc., FAusIMM, FSEG – Director and Executive Chairman of the Board Kimberly Ann Arntson – Director Zimi Meka, B. Eng. (Mech) Hons, FAusIMM, MAICD, FIEAust – Director Fernando Pickmann, LLM – Director Yale Simpson, BApSc. – Director Alar Soever, B.Sc., P. Geo. – Director

Corporate Web-site

www.c3metals.com

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Corporate Office

161 Bay Street 27[th] Floor Toronto, ON M5J 2S1 Phone: (647) 953-5924

Independent Auditor

PricewaterhouseCoopers LLP, Ottawa, Canada

Corporate Legal Counsel

Irwin Lowy LLP, Toronto, Canada

Corporate Banker

The Bank of Nova Scotia, Ottawa, Canada and Kingston, Jamaica

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