CONDOR RESOURCES INC. — Interim / Quarterly Report 2021

Jan 29, 2021

Condensed Consolidated Financial Statements (Expressed in Canadian dollars) For the Nine Months Ended November 30, 2020 and 2019 (Unaudited – prepared by Management)

NOTICE OF NO AUDITOR REVIEW OF INTERIM FINANCIAL STATEMENTS

Under National Instrument 51-102, Part 4, subsection 4.3 (3) (a), if an auditor has not performed a review of the interim financial statements, they must be accompanied by a notice indicating that the financial statements have not been reviewed by an auditor.

These accompanying unaudited condensed consolidated interim financial statements of Condor Resources Inc. have been prepared by and are the responsibility of the Company's management.

The Company's independent auditor has not performed a review of these condensed consolidated financial statements in accordance with the standards established by the Canadian Institute of Chartered Accountants for a review of interim financial statements by an entity's auditor.

Vancouver, Canada

January 29, 2021

CONDOR RESOURCES INC. CONDENSED CONSOLIDATED INTERIM STATEMENTS OF FINANCIAL POSITION

	CONDENSED CONSOLIDATED INTERIM STATEMENTS OF FINANCIAL POSITION(Unaudited, prepared by management and expressed in Canadian Dollars)
	As at November 30,2020	As at February 29,2020
ASSETS
Current
Cash and cash equivalents	$471,235	$61,088
Prepaid expenses	16,701	11,230
Accounts receivable	9,125	10,356
Marketable securities (Note 5)	212,000	158,650
Total Current Assets	709,061	241,324
Non-Current Assets
Equipment (Note 6)	42,660	7,057
Exploration and evaluation assets (Note 7)	2,449,896	1,979,571
Total Non-Current Assets	2,492,556	1,986,628
TOTAL ASSETS	$3,201,617	$2,227,952
LIABILITIES
Current liabilities
Accounts payable and accrued liabilities (Note 8)	$64,654	$102,129
Non-Current Liabilities
Loan (Note 9)	40,000	-
TOTAL LIABILITIES	104,654	102,129
SHAREHOLDERS' EQUITY
Share capital (Note 10)	21,983,186	20,833,387
Contributed surplus (Note 10)	3,688,449	3,515,810
Deficit	(22,574,672)	(22,223,374)
TOTAL SHAREHOLDERS' EQUITY	3,096,963	2,125,8232,227,952
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$3,201,617	$

Nature of operations (Note 1) Subsequent Events (Note 15)

Approved on behalf of the Board:

"Paul Larkin" Director

"Lyle Davis" Director

CONDOR RESOURCES INC. CONDENSED CONSOLIDATED INTERIM STATEMENTS OF COMPREHENSIVE LOSS

CONDOR RESOURCES INC.CONDENSED CONSOLIDATED INTERIM STATEMENTS OF COMPREHENSIVE LOSS
(Unaudited, prepared by management and expressed in Canadian Dollars)
	For the Three Months Ended		For the Nine Months Ended
	November 30,		November 30,
	2020	2019	2020	2019
Administrative expenses
Conferences and seminars	$-$	-$	-	$657
Foreign exchange (gain) loss	10,443	(227)	7,662	3,245
Insurance	2,365	2,094	6,599	6,329
Investor relations	50	150	2,695	683
Management fees and consulting fees	40,099	44,285	122,724	139,238
Office and miscellaneous	13,622	5,574	23,358	17,069
Professional fees	1,446	3,751	24,058	26,888
Project generation	19,049	(174)	44,884	19,629
Regulatory fees	11,931	4,036	19,774	8,630
Stock-based compensation	16,439	5,393	248,687	24,304
Travel and entertainment	-	-	1,942	2,330
	(115,444)	(64,882)	(502,383)	(249,002)
Other items
Interest income	1,130	-	2,575	-
Other income (loss) (Note 7(o))	-	(83,342)	-	605,374
Gain (loss) on sale of marketable securities	-	(25,420)	11,535	(34,172)
Unrealized gain (loss) on marketable securities (Note 5)	(56,000)	(45,925)	136,975	(348,300)
	(54,870)	(154,687)	151,085	222,902
Net Income (Loss) and Comprehensive Income (Loss) for the
Period	$(170,314)$	(219,569)$	(351,298)	$(26,100)
Basic And Diluted Income (Loss) Per Share Outstanding	$(0.00)$	(0.00)$	(0.00)	$(0.00)
Weighted Average Number Of Shares Outstanding	123,865,385	105,480,385	117,568,726
				104,862,763

CONDOR RESOURCES INC. CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS

	CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS(Unaudited, prepared by management and expressed in Canadian Dollars
	For the Nine Months Ended November 30,
Cash and cash equivalents provided by (used in):	2020	2019
Operating Activities
Net income (loss) for the period	$(351,298)$	(26,100)
Items not affecting cash:
Stock-based compensation	248,687	24,304
Unrealized (gain) loss on marketable securities(Gain) loss on sale of marketable securities	(136,975)(11,535)	348,30034,172
Recoveries included in income and reclassified to
investing activities	-	(605,374)
Changes in non-cash operating working capital items:
(Increase) decrease in prepaid expenses	(5,471)	3,404
(Increase) decrease in accounts receivable	1,231	(1,943)
Increase (decrease) in accounts payable and accrued
liabilities	(37,805)	12,320
	(293,166)	(210,917)
Investing Activities
Equipment purchased	(37,835)	(1,053)
Exploration and evaluation expenditures	(600,593)	(396,956)
Expenditure recoveries/option proceeds	132,830	412,143
Sale of marketable securities	95,160	82,278
	(410,438)	96,412
Financing Activities
Share capital issued	1,103,750	200,000
Share issue costs	(29,999)	(7,498)
Loan received	40,000	-
	1,113,751	192,502
Increase (decrease) in cash and cash equivalents during the
period	410,147	77,997
Cash and cash equivalents - beginning of period	61,088	113,443
Cash and cash equivalents - end of period	$471,235$	191,440

CONDOR RESOURCES INC. CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN EQUITY

		(Unaudited, prepared by management and expressed in Canadian Dollars)
	Number of Shares	Share Capital	ContributedSurplus	Deficit	Total Equity
Balance, February 28, 2019	104,557,308	$20,585,363	$3,509,063$	(22,102,213)$	1,992,213
Private placement financing	4,000,000	200,000	-	-	200,000
Share issuance costs	-	(7,498)	-	-	(7,498)
Stock-based compensation	-	-	24,304	-	24,304
Net income and comprehensive income for the period	-	-	-	(26,100)	(26,100)
Balance, November 30, 2019	108,557,308	20,777,865	3,533,367	(22,128,313)	2,182,919
Options exercised	670,000	33,500	-	-	33,500
Fair value of options exercised	-	22,022	(22,022)	-	-
Stock-based compensation	-	-	4,465	-	4,465
Net loss and comprehensive loss for the period	-	-	-	(95,061)	(95,061)
Balance, February 29, 2020	109,227,308	20,833,387	3,515,810	(22,223,374)	2,125,823
Private placement financing	13,200,000	990,000	-	-	990,000
Share issuance costs	-	(29,999)	-	-	(29,999)
Options exercised	1,645,000	113,750	-	-	113,750
Fair value of options exercised	-	76,048	(76,048)	-	-
	-	-	248,687	-	248,687
Stock-based compensation		-
Net loss and comprehensive loss for the period	-		-	(351,298)	(351,298)

Notes to the Condensed Consolidated Interim Financial Statements (Unaudited, prepared by management and expressed in Canadian dollars) For the nine months ended November 30, 2020 and 2019

1. CORPORATE INFORMATION AND NATURE OF OPERATIONS

Condor Resources Inc. (the "Company") was incorporated in British Columbia on November 26, 2003. The company's primary business is the acquisition and exploration of mineral properties and is considered to be an exploration stage company.

The Company is listed on the TSX Venture Exchange ("TSX-V"), having the symbol CN-V, as a Tier 2 mining issuer.

The address of the Company's corporate office and principal place of business is Suite 520 - 800 West Pender Street, Vancouver, British Columbia, V6C 2V6.

The Company is currently engaged in the exploration and development of mineral properties in Peru and has not yet determined whether its properties contain ore reserves that are economically recoverable and, to date, the Company has not generated any revenue from operations. The mining exploration business involves a high degree of risk. The recoverability of the amounts expended on mineral interests by the Company is dependent upon the existence of economically recoverable reserves, the ability of the Company to obtain necessary financing to complete exploration and development of its mineral properties and upon future profitable production or proceeds from disposition of its mineral interests.

These condensed consolidated interim financial statements have been prepared on the assumption that the Company will continue as a going concern, meaning that it will continue in operation for the foreseeable future and will be able to realize its assets and discharge its liabilities in the ordinary course of business. The Company has no current or anticipated source of operating revenue, has incurred losses since inception, and its long term viability remains entirely dependent upon the receipt of equity and/or related party debt financing on terms which are acceptable to it. Although such financing has been available to the Company in the past, there can be no guarantee that it will continue to be so in the future.

2. BASIS OF PRESENTATION AND MEASUREMENT

(a) Statement of Compliance

These condensed consolidated interim financial statements of the Company for the nine months ended November 30, 2020 have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB").

Notes to the Condensed Consolidated Interim Financial Statements (Unaudited, prepared by management and expressed in Canadian dollars) For the nine months ended November 30, 2020 and 2019

2. BASIS OF PRESENTATION AND MEASUREMENT (continued)

(a) Statement of Compliance (continued)

These condensed consolidated interim financial statements have been prepared in accordance with International Accounting Standard 34, "Interim Financial Reporting" ("IAS 34"). Accordingly, these condensed consolidated interim financial statements follow the same accounting principles and methods of application as the annual consolidated financial statements for the year ended February 29, 2020 but may condense or omit certain disclosures that otherwise would be present in annual financial statements prepared in accordance with IFRS. These financial statements should therefore be read in conjunction with the annual consolidated financial statements for the year ended February 29, 2020. Results for the period ended November 30, 2020, are not necessarily indicative of future results.

These unaudited condensed consolidated interim financial statements were authorized for issue by the Board of Directors on January 29, 2021.

(b) Financial Statement Presentation

These financial statements include the accounts of the Company, its 100% owned Peruvian subsidiary, Condor Exploration Peru S.A.C., its 100% owned Peruvian subsidiary, Minas Lucero Del Sur S.A.C., and its 85%-owned Peruvian subsidiary, Ferroaluminios Peru No.4 S.A.C. All significant inter-company transactions and balances have been eliminated on consolidation. All amounts are stated in Canadian dollars unless otherwise indicated.

Name of Subsidiary	Place of Operation	OwnershipInterest	Principal Activity
Condor Exploration Peru S.A.C.	Peru	100%	Carries out business forPeruvian properties
Minas Lucero Del Sur S.A.C.	Peru	100%	Carries out business fora Peruvian property
Ferroaluminios Peru No.4 S.A.C.	Peru	85%	Carries out business forPeruvian properties

In September 2019, Condor Exploration Peru S.A.C. absorbed Minera Vertiente del Sol S.A.C. to simplify the corporate structure of the Company's subsidiaries in Peru.

The preparation of financial statements in compliance with IFRS requires management to make certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in Note 4. Certain comparative amounts have been reclassified to conform to the presentation adopted in the current year.

Notes to the Condensed Consolidated Interim Financial Statements (Unaudited, prepared by management and expressed in Canadian dollars) For the nine months ended November 30, 2020 and 2019

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a) Exploration and evaluation assets

The Company is in the process of exploring its resource properties and has not yet determined whether these properties contain reserves that are economically recoverable.

The Company capitalizes mineral property expenditures applicable to property interests for which it has an exploration license as deferred mineral property costs.

The cost of acquiring mineral properties and exploration expenditures are deferred until such time as the mineral properties are placed into production or the prospect is determined by management to be impaired, or is abandoned. Upon production, the deferred costs are amortized on a unit-of-production basis while in circumstances of impairment or abandonment the costs are written off.

Any option or royalty payments received by the Company from third parties are credited to the capitalized cost of the exploration and evaluation assets. If payments received exceed the capitalized cost of the exploration and evaluation assets, the excess is recognized as income in the period received.

Title to mineral properties involves certain inherent risks due to the difficulties in determining the validity of certain claims as well as the potential for problems arising from the frequently ambiguous conveyance history characteristic of many mineral properties. The Company has investigated title to all of its mineral properties, and to the best of the Company's knowledge, titles to all of its properties are in good standing.

(b) Stock-based compensation

The Company accounts for stock-based compensation using the fair value-based method with respect to all stock-based payments to directors, employees and non-employees. Under the fair value-based method, stock-based compensation is measured at fair value and recognized in operations over the vesting period. Fair value is determined using the Black-Scholes option pricing model. Any consideration paid on exercise of stock options together with the related fair value previously recognized in contributed surplus is credited to share capital.

(c) Share capital

Proceeds from the exercise of stock options and warrants are recorded as share capital at the amount for which the stock option and warrant enabled the holder to purchase shares of the Company. Share capital issued for non-monetary consideration is recorded at fair value based on the quoted market price on the date of issuance. Share issue costs, which include commissions and professional and regulatory fees are charged directly to share capital.

Notes to the Condensed Consolidated Interim Financial Statements (Unaudited, prepared by management and expressed in Canadian dollars) For the nine months ended November 30, 2020 and 2019

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

(d) Foreign currency translation

The functional and reporting currency of the Company, inclusive of the accounts of each of its consolidated subsidiaries, is the Canadian dollar. Transactions denominated in other currencies are translated into their Canadian dollar equivalents at exchange rates prevailing at the transaction date. Carrying values of monetary assets and liabilities denominated in foreign currencies are adjusted at each balance sheet date to reflect exchange rates prevailing at that date. Foreign exchange gains and losses are included in operations.

(e) Income taxes

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax is not recognized for temporary differences which arise on the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting, nor taxable profit or loss. Deferred tax assets and liabilities are measured using substantively enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Deferred income tax assets also result from unused loss carry forwards, resource related pools and other deductions. A deferred tax asset is recognized for unused tax losses, tax credits and deductible temporary differences to the extent that it is probable that future taxable profits will be available against which they can be utilized.

Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized.

(f) Financial instruments

The following financial assets are classified as subsequently measured at amortized cost - cash and cash equivalents and accounts receivable (excluding sales tax receivable).

Marketable securities are classified as fair value through profit or loss ("FVPL").

The classification of financial assets is based on how an entity manages its financial instruments and the contractual cash flow characteristics of the financial asset. Transaction costs with respect to financial instruments classified as fair value through profit or loss are recognized as an adjustment to the cost of the underlying instruments.

Notes to the Condensed Consolidated Interim Financial Statements (Unaudited, prepared by management and expressed in Canadian dollars) For the nine months ended November 30, 2020 and 2019

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

The Company's financial assets are classified into one of the following two measurement categories:

Financial assets held within a business model for the purpose of collecting contractual cash flows ("held to collect") that represent solely payments of principal and interest ("SPPI") are measured at amortized cost. Financial assets held within a business model where assets are both held for the purpose of collecting contractual cash flows or sold prior to maturity and the contractual cash flows represent solely payments of principal and interest are measured at FVPL.

The following financial liability is classified as subsequently measured at amortized cost - accounts payable and accrued liabilities.

(g) Loss per share

Basic loss per share is calculated by dividing the loss available to common shareholders by the weighted average number of common shares outstanding in the period. Diluted loss per share is calculated by the treasury stock method. Under the treasury stock method, the weighted average number of common shares outstanding for the calculation of diluted loss per share assumes that the proceeds to be received on the exercise of dilutive share options and warrants are used to repurchase common shares at the average market price during the period. Where the effects of including all outstanding options and warrants would be anti-dilutive, no dilution is calculated and the diluted loss per share is presented as the same as basic loss per share.

(h) Impairment

At each reporting period, management reviews mineral properties for indicators of impairment. If any such indication exists, the recoverable amount of the asset is estimated to determine the extent of the impairment, if any. The recoverable amount is the higher of fair value less costs to sell and value in use. Fair value is determined as the amount that would be obtained from the sale of the asset in an arm's length transaction. In assessing value in use, the estimated future cash flows are discounted to their present value. If the recoverable amount of the asset is less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount and the impairment loss is recognized in the profit or loss for that period. For an asset that does not generate largely independent cash inflows, the recoverable amount is determined for the cash generating unit to which that asset belongs.

Past impairments are also considered at each reporting period and where there is an indication that an impairment loss may have decreased, the recoverable amount is calculated as outlined above to determine the extent of the recovery. If the recoverable amount of the asset is more than its carrying amount, the carrying amount of the asset is increased to its recoverable amount and the impairment loss is reversed in profit or loss for that period. The increased carrying amount due to reversal will not be more than what the depreciated historical cost would have been if the impairment had not been recognized.

(i) Cash and cash equivalents

Cash and cash equivalents include all cash accounts, which are not subject to withdrawal restrictions or penalties.

Notes to the Condensed Consolidated Interim Financial Statements (Unaudited, prepared by management and expressed in Canadian dollars) For the nine months ended November 30, 2020 and 2019

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

(j) Equipment

Equipment is recorded at cost. Amortization is recorded on a declining balance basis over the estimated useful lives of the related assets at the following annual rates:

Office furniture and equipment	20%
Computer equipment	50%
Motor vehicles	30%

(k) New accounting standards and interpretations issued but not yet effective:

The Company has reviewed the new and revised accounting pronouncements that are issued and effective as of March 1, 2019:

• IFRS 16 Leases; and
• IAS 12 Income Taxes Annual Improvements to IFRS Standards.

These new and revised standards did not have a material impact on the Company's consolidated financial statements.

4. CRITICAL ACCOUNTING ESTIMATES AND JUDGMENTS

The Company makes estimates and assumptions about the future that affect the reported amounts of assets and liabilities. Estimates and judgments are continually evaluated based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. In the future, actual experience may differ from these estimates and assumptions. The effect of a change in an accounting estimate is recognized prospectively by including it in comprehensive income in the period of the change, if the change affects that period only, or in the period of the change and future periods, if the change affects both.

Financial statement items that are subject to significant estimation uncertainty include the valuation of stock-based compensation and the carrying value of exploration and evaluation assets.

The judgments that the Company's management has made in the process of applying the Company's accounting policies, apart from those involving estimations, that have the most significant effect on the amounts recognized in the Company's consolidated financial statements are as follows:

i) Critical judgment is applied for the determination of the functional currency for each entity of the Company. In concluding that the Canadian dollar is the functional currency of the Company and its subsidiaries, management considered the currency that mainly influences the cost of providing goods and services in each jurisdiction in which the Company operates. As no single currency was clearly dominant the Company also considered secondary indicators including the currency in which funds from financing activities are denominated and the currency in which funds are retained.

Notes to the Condensed Consolidated Interim Financial Statements (Unaudited, prepared by management and expressed in Canadian dollars) For the nine months ended November 30, 2020 and 2019

4. CRITICAL ACCOUNTING ESTIMATES AND JUDGMENTS (continued)

ii) The Company has selected a policy of capitalizing exploration and evaluation expenditures that it has an exploration license in as exploration and evaluation assets. Acquisition and exploration costs incurred in respect to a particular property interest before the formal exploration licenses are acquired, but where such subsequent acquisition can be reasonably assured, are also capitalized as exploration and evaluation assets. At each period end, management applies its judgment in determining whether facts and circumstances suggest that the carrying amount of the asset exceeds it recoverable amount, and if so, the carrying value of the asset is tested for impairment.

5. MARKETABLE SECURITIES

and evaluation assets. At each period end, management applies its judgment in determining whetherfacts and circumstances suggest that the carrying amount of the asset exceeds it recoverable amount,and if so, the carrying value of the asset is tested for impairment.
iii)Critical judgment and estimates are applied for the determination that the Company willcontinue as a going concern for the next year.
5.MARKETABLE SECURITIES
Marketable securities consist of 400,000 common shares of Chakana Copper Corp. ("Chakana") that werereceived during fiscal 2019 and 2020 as described at Note 7(f), and are stated at their November 30, 2020fair market value of $212,000. During the nine months ended November 30, 2020, the Company sold435,000 common shares of Chakana for gross proceeds of $95,160 (November 30, 2019 – Sold 465,000shares for gross proceeds of $82,278).6.EQUIPMENT
			Office
	Computer	Motor	furniture and
	equipment	vehicle	equipment	Total
COST
Balance, February 28, 2019	$17,365	$-	$9,377	$26,742
Additions	-	-	1,056	1,056
Balance, February 29, 2020	$17,365	$-	$10,433	$27,798
Additions	-	37,835	-	37,835
Balance, November 30, 2020	$17,365	$37,835	$10,433	$65,633
AMORTIZATION
Balance, February 28, 2019	$14,576	$-	$3,298	$17,874
Amortization	1,864	-	1,003	2,867
Balance, February 29, 2020	$16,440	$-	$4,301	$20,741
Amortization	693	-	1,539	2,232
Balance, November 30, 2020	$17,133	$-	$5,840	$22,973
CARRYING AMOUNTS
As at February 29, 2020	$925	$-	$6,132	$7,057
As at November 30, 2020	$232	$37,835	$4,593	$42,660

6. EQUIPMENT

7. EXPLORATION AND EVALUATION ASSETS

Summary of Exploration and Evaluation Expenditures

CONDOR RESOURCES INC.Notes to the Condensed Consolidated Interim Financial Statements(Unaudited, prepared by management and expressed in Canadian dollars)For the nine months ended November 30, 2020 and 2019
7.EXPLORATION AND EVALUATION ASSETS
The following schedules of mineral property costs set forth the expenditures incurred on these properties
as at November 30, 2020 and February 29, 2020.
Summary of Exploration and Evaluation Expenditures
	As at
	November 30,		As at February
	2020		29, 2020
Acquisition costs	$	82,564$	82,564
Deferred exploration costs		1,924,333	1,486,519
		2,006,897	1,569,083
IGV taxes		442,999	410,488

As their recoverability from government authorities is uncertain, IGV input credits are capitalized and included within the carrying value of the related property interests. Any amounts ultimately recovered will therefore be offset against the related deferred costs or included in income if such costs have been expensed.

IGV is a form of value-added tax levied on expenditures incurred in Peru.

Schedule of Exploration and Evaluation assets – Peru For the Nine Months Ended November 30, 2020

CONDOR RESOURCES INC.
Notes to the Condensed Consolidated Interim Financial Statements
(Unaudited, prepared by management and expressed in Canadian dollars)
For the nine months ended November 30, 2020 and 2019
	Schedule of Exploration and Evaluation assets – PeruFor the Nine Months Ended November 30, 2020
	Pucamayo	Lucero	Ocros	Chavin	Quriurqu	San Martin	Soledad	Humaya	Huinac Punta	Andrea	Quilisane	Cobreorco	CantagalloTotal
Acquisition costsBalance, as at March 1, 2020Additions during the period	$62,509$-	-$-	--	$--	$-$-	-$-	20,055$-	--	$--	$-$-	--	$-$-	-$82,564--
Balance, as at November 30, 2020	62,509	-	-	-	-	-	20,055	-	-	-	-	-	-82,564
Exploration and evaluation expenditures
Balance, as at March 1, 2020	714,689	15,776	-	146,229	117,049	282,999	-	5,695	129,925	40,822	12,040	40,554	7961,506,574
Additions during the period		-	-	-	-	-	-	-	45,656	-	-	15,852	61,508
Geophysics	-		-	14,825	2,312	2,300	-	2,699	-	-	7,082	16,573	771124,720
Property tenure	56,625	21,533									-	-	-4,839
Community relations	4,839	-	-	-	-	-	-	-	-	-
Office and technical support	70,780	7,049	18,251	13,244	5,877	9,459	174,457	-	47,760	6,097	-	6,548	-359,522
	132,244	28,582	18,251	28,069	8,189	11,759	174,457	2,699	93,416	6,097	7,082	38,973	771550,589
Balance, as at November 30, 2020	846,933	44,358	18,251	174,298	125,238	294,758	174,457	8,394	223,341	46,919	19,122	79,527	1,5672,057,163
Proceeds of option and royalty payments	-	-	-	-	-	-	(132,830)	-	-	-	-	-	-(132,830)

Costs are exclusive of IGV taxes incurred

Schedule of Exploration and Evaluation assets – Peru For the Year Ended February 29, 2020

CONDOR RESOURCES INC.Notes to the Condensed Consolidated Interim Financial Statements(Unaudited, prepared by management and expressed in Canadian dollars)For the nine months ended November 30, 2020 and 2019Schedule of Exploration and Evaluation assets – PeruFor the Year Ended February 29, 2020PucamayoLuceroOcrosChavinQuriurquSan MartinSoledadHumayaHuinac PuntaAndreaQuilisaneCobreorcoCantagalloTotalAcquisition costsBalance, as at March 1, 2019$62,509$-$-$-$-$-$20,055$-$-$-$-$-$-$Additions during the year--------------Balance, as at February 29, 202062,509-----20,055------Exploration and evaluation expendituresBalance, as at March 1, 2019606,332--124,072106,007263,579-2,91195,44519,6423,91828,461-Additions during the yearProperty tenure58,843-(1,193)3,9782,3862,373-2,78413,99712,7297,9563,296796Community relations2,009------------Office and technical support47,50515,77625,29618,1798,65617,047364,182-20,4838,4511668,797-108,35715,77624,10322,15711,04219,420364,1822,78434,48021,1808,12212,093796Balance, as at February 29, 2020714,68915,77624,103146,229117,049282,999364,1825,695129,92540,82212,04040,554796Proceeds of option and royalty payments--(24,103)---(384,237)------Overall balances, as at February 29, 2020$777,198$15,776$-$146,229$117,049$282,999$-$5,695$129,925$40,822$12,040$40,554$796$1,569,083
							82,564
							82,564
							1,250,367
							107,945
							2,009
							534,538
							644,492
							1,894,859
							(408,340)

Costs are exclusive of IGV taxes incurred

Notes to the Condensed Consolidated Interim Financial Statements (Unaudited, prepared by management and expressed in Canadian dollars) For the nine months ended November 30, 2020 and 2019

7. EXPLORATION AND EVALUATION ASSETS (continued)

PERU

(a) Ocros and Pucamayo – Combined Amended Agreement: Option to acquire an 85% interest

On February 16, 2009 the Company replaced and superseded its original agreements dated August 21, 2007 on the Ocros, Pucamayo and Condor de Oro prospects.

Pursuant to the February 16, 2009 Amended Peruvian Property Agreement ("Amended Agreement"), the Company paid USD $400,000 and issued 2,000,000 common shares at a value of $670,000 to acquire an 85% working interest in each of the Ocros, Pucamayo and Condor de Oro prospects from the property vendor. On the execution and delivery of the agreement, $95,000 in advances to the property vendor for title perfection for the prospects was forgiven and recorded as acquisition costs. The Company forfeited its interest and allowed the title to lapse in all the original Pucamayo concessions, except Pucamayo 14, prior to March 1, 2016. The Company also forfeited its interest and allowed the title to lapse in the Condor de Oro property in June 2016.

The vendor, a private company controlled by a senior officer of the Company retained a royalty of one per cent (1%) of the "net smelter returns" ("NSR") derived from each of the Ocros concessions and the Pucamayo 14 concession (the "Properties"). The Company shall have the exclusive right to purchase the royalty on one or more of the Properties at any time on payment to the vendor of the sum of USD $2,000,000 per property.

The vendor will receive an additional 1,000,000 common shares in the capital of the Company on the completion and publication of a positive feasibility study on any or all of the Properties which indicates that commercial production for the applicable property is feasible.

In this agreement "Feasibility Study" shall have the meaning set out in NI 43-101, or such successor policy as may be adopted from time to time by the Canadian Securities Administrators.

Following the closing, the holder of the 15% interest in each of the Properties, a party related to a senior officer of the Company, became a carried and non-contributing interest. The Company will fund all of the vendor's costs to the commencement of commercial production, such costs to be repaid to the Company, with interest at the Canadian prime rate plus 2%, from 100% of the vendor's production revenues.

In February 2017, the Company assigned the royalty buyback rights on the Ocros concessions and Pucamayo 14 concession to Sandstorm Gold Ltd. ("Sandstorm") for consideration of $100,000.

Notes to the Condensed Consolidated Interim Financial Statements (Unaudited, prepared by management and expressed in Canadian dollars) For the nine months ended November 30, 2020 and 2019

7. EXPLORATION AND EVALUATION ASSETS (continued)

(b) Ocros, Ocros Province – option granted

In May 2017, a Comprehensive Agreement (the "Ocros Agreement)" was signed with Compañia Minera Virgen de la Merced S.A.C. ("Merced") with respect to the Ocros project. Under the Ocros Agreement, Merced has two exclusive options to earn up to a 70% interest in the Ocros concessions over a period of four years.

To exercise the first option and earn 51%, Merced is required to make the following cash payments to the Company and complete exploration work as follows:

• i. US $75,000 upon signing the Ocros Agreement (received);
• ii. complete 2,000 metres of diamond drilling on or before May 16, 2018 (the first anniversary of the effective date of the agreement (May 16, 2017)) (completed);
• iii. US $75,000 on or before May 16, 2018 (received);
• iv. US $75,000 on or before May 16, 2019 (received);
• v. complete a cumulative total of 4,000 metres of diamond drilling on the Ocros Property on or before May 16, 2019 (completed);
• vi. US $25,000 on or before May 16, 2020, or two months after the date on which an aggregate of 6,000 metres of diamond drilling has been conducted, whichever comes first (received); and
• vii. complete a cumulative total of 6,000 metres of diamond drilling on or before May 16, 2020 (completed).

To exercise the second option and earn an additional 19% in the Ocros property for a total of 70%, Merced must:

viii. complete 4,000 metres of additional diamond drilling on the Ocros Property and make an additional cash payment of US $300,000, on or before one year following the exercise of the first option.

(c) Pucamayo, Chinca, Yauyos, and Castrovirreyna Provinces

Subsequent to the February 16, 2009 agreement, the Company dropped all but the Pucamayo 14 concession, and acquired by staking one concession to the east and 2 concessions to the south of Pucamayo 14. These added concessions were not subject to the provisions of the February 16, 2009 agreement and thus owned 100% by the Company. As at March 1, 2016 the project consisted of 19 sq. km., with the Company holding an 85% interest in 6 sq. km. (Pucamayo 14), and a 100% interest in 13 sq. km. of staked concessions. During the fiscal year ended February 28, 2017, the Company acquired unencumbered title to a 100% interest in 94 sq. km. of mineral concessions, and in May 2018 acquired another 2 sq. km. concession by staking. In June 2019, the Company relinquished two concessions, and the total area of the Pucamayo concessions is now 109 sq km. In February 2017, the Company sold a 0.5% NSR royalty on all the Pucamayo concessions except for Pucamayo 14, to Sandstorm for $50,000.

Notes to the Condensed Consolidated Interim Financial Statements (Unaudited, prepared by management and expressed in Canadian dollars) For the nine months ended November 30, 2020 and 2019

7. EXPLORATION AND EVALUATION ASSETS (continued)

(d) Chavin, Santa Province

During the year ended February 28, 2010, the Company acquired two concessions by staking in the Province of Santa, referred to as the Chavin project. During the year ended February 28, 2011, a third concession was acquired by staking.

In November 2015, the Company concluded a production royalty agreement with Compañia Minera Casapalca S.A. ("Casapalca") on the Chavin project. In February 2017, the Company sold a 50% interest in its annual production royalty at Chavin to Sandstorm for $50,000. In November 2018, Casapalca terminated the production royalty agreement and returned the original three concessions as well as five adjoining concessions to the Company. On termination of the Casapalca production royalty agreement, Sandstorm's interest at Chavin converted to a 0.5% NSR.

(e) San Martin, Castilla Province

During the year ended February 28, 2010, the Company acquired, by staking, one concession in the Province of Castilla for a nominal amount. In 2015, a second contiguous concession was acquired by staking for a nominal amount.

The Company continues to maintain its title and intends to either complete future exploration work or option this property. In February 2017, the Company sold a 0.5% NSR on the San Martin project to Sandstorm for $50,000.

(f) Soledad, Aija Province

In late 2011, the Company acquired, by sealed bid auction, a 100% interest in one concession in northcentral Peru. A second and third concession were acquired by staking in 2015 and 2017.

In April 2017, a Comprehensive Agreement (the "Agreement") was signed with Chakana Resources S.A.C. ("Chakana") with respect to the Soledad project. Pursuant to the Agreement, Chakana has the option to earn a 100% interest in Soledad, over a period of 4.5 years, subject to a 2% NSR in favour of the Company. To earn the 100% interest, Chakana is required to:

• a. complete the following drilling:
• i. complete a minimum of 3,000m of drilling (or work equivalent) by December 23, 2018 (complete);
• ii. complete a cumulative total of 5,500m of drilling (or work equivalent) by December 23, 2019 (complete);
• iii. complete a cumulative total of 8,500m of drilling (or work equivalent) by December 23, 2020 (complete);
• iv. complete a cumulative total of 12,500m of drilling (or work equivalent) by December 23, 2021 (complete).

Notes to the Condensed Consolidated Interim Financial Statements (Unaudited, prepared by management and expressed in Canadian dollars) For the nine months ended November 30, 2020 and 2019

7. EXPLORATION AND EVALUATION ASSETS (continued)

(f) Soledad, Aija Province (continued)

• b. make the following cash payments:
• i. US $10,000 upon signing the MOU (received);
• ii. US $15,000 upon signing the Agreement (received);
• iii. US $25,000 by December 23, 2017 (received);
• iv. US $50,000 by June 23, 2018 (received);
• v. US $50,000 by December 23, 2018 (received);
• vi. US $75,000 by June 23, 2019 (received);
• vii. US $75,000 by December 23, 2019 (received);
• viii. US $100,000 by June 23, 2020 (received);
• ix. US $150,000 by December 23, 2020 (received);
• x. US $200,000 by June 23, 2021;
• xi. US $200,000 by December 23, 2021;
• xii. US $4,425,000 by April 23, 2022.

c. issue 500,000 Chakana Resources Corp. shares to Condor by June 23, 2018, provided Chakana has not terminated the Agreement (received).

Should Chakana exercise the option, it would obtain the right to acquire 50% of the NSR royalty held by Condor by payment of US $2 million to Condor.

In April 2019, the NSR was amended, whereby Condor received 900,000 Chakana shares and US$275,000 cash in consideration for reducing the royalty it would retain on exercise of the purchase option from a 2% NSR to a 1% NSR. Chakana will have the right to buy down Condor's remaining 1% NSR to a 0.5% NSR by further payment of US $1 million. Pre-production NSR payments scheduled to commence in 2022 have also been eliminated.

In the event Chakana does not exercise their option to acquire the Soledad concessions, Chakana will retain a 1% NSR royalty on the concessions, which Condor will have the option to reduce to a 0.5% NSR by payment of US$1 million.

In November 2020, the Company and Chakana amended the payment schedule, whereby the final payment of US$4,625,000 originally due by December 21, 2021, is due as to US$200,000 by December 21, 2021, with the balance of US$4,425,000 due by April 23, 2022.

Notes to the Condensed Consolidated Interim Financial Statements (Unaudited, prepared by management and expressed in Canadian dollars) For the nine months ended November 30, 2020 and 2019

7. EXPLORATION AND EVALUATION ASSETS (continued)

(g) Quriurqu; Aija and Huarmey Provinces

In February 2012, the Company acquired, by staking, one concession located both in the Provinces of Aija and Huarmey for a nominal amount. In January 2016, the Company petitioned for 6 sq. km. contiguous and to the south of Quriurqu, and secured this area at a sealed bid auction conducted by the Ministry of Energy & Mines in September bringing the total to 8.5 sq. km.

The Company continues to maintain its title and intends to complete future exploration work on option this property. In February 2017, the Company sold a 0.5% NSR on the Quriurqu project to Sandstorm for $50,000.

(h) Lucero, Castilla Province

The Company previously acquired, by staking, three concessions totaling 21 sq. km.

In November 2015, the Company concluded a production royalty agreement with Compañia Minera Casapalca S.A. ("Casapalca") on the Lucero project. In February 2017, the Company sold 50% of Condor's production royalties to Sandstorm for $50,000. In November 2019, Casapalca provided notice of termination of the production royalty agreement. On termination of the Casapalca production royalty agreement, Sandstorm's interest at Lucero converted to a 0.5% NSR.

In December 2020, the Company concluded an agreement with Calipuy Resources Inc. ("Calipuy") whereby Calipuy purchased Condor's wholly owned Peruvian subsidiary, Minas Lucero del Sur S.A.C. ("MLDS"). MLDS is a sole purpose company, and the owner of the Lucero project.

Consideration is US$3.5 million, payable over five years. Should the price of gold be over US$2,500/ounce at the time of the final payment, total consideration will increase to US$4.0 million; and should the price of gold be over $3,000/ounce at the time of the final payment, the total consideration will increase to US$6.0 million. Calipuy have the option to compress the payment schedule to three years, and in such event, the total consideration will be US$3.0 million. Condor has received the initial payment of US$90,000.

Condor has maintained certain back in rights to participate in future Calipuy financings. Should Calipuy be conducting a financing, Condor have the option to participate in the financing at a 20% discount to the financing price, by converting part or all of any outstanding payment due from Calipuy. Condor's right to participate in a Calipuy financing is limited to 50% of the financing.

Sandstorm, Condor, Calipuy and MLDS have executed an NSR assignment agreement with respect to Sandstorm's NSR, with Calipuy assuming the NSR obligations to Sandstorm.

(i) Humaya, Ayacucho Department

The Company previously acquired by staking one concession of 7 sq. km. In February 2017, the Company sold a 0.5% NSR on the Humaya project to Sandstorm for $50,000.

Notes to the Condensed Consolidated Interim Financial Statements (Unaudited, prepared by management and expressed in Canadian dollars) For the nine months ended November 30, 2020 and 2019

7. EXPLORATION AND EVALUATION ASSETS (continued)

(j) Quilisane, Puno Department

The Company originally acquired by staking, and sealed bid auctions, two concessions comprising a total area of 18.4 sq. km. In February 2017, the Company sold a 0.5% NSR on the Quilisane project to Sandstorm for $50,000. In 2019, the Company reduced its holdings to 4 sq. km.

(k) Huiñac Punta, Huanuco Department

The Company acquired by staking one concession in 2016. In February 2017, the Company sold a 0.5% NSR on the Huiñac Punta project to Sandstorm for $50,000. Two additional concessions were acquired in November 2017, for a total project area of approximately 20 sq. km. These additional concessions are also subject to the Sandstorm 0.5% NSR.

(l) Andrea, Ayacucho Department

The Company acquired a 100% interest in the 22 sq. km Andrea project by staking and by sealed bid auction conducted by the Peruvian Ministry of Energy and Mines. All costs incurred prior to the Company being granted title to Andrea were charged to project generation.

(m) Cobreorco, Apurimac Department

The Company acquired a 100% interest in approximately 5 sq. km by staking, and by sealed bid auction conducted by the Peruvian Ministry of Energy and Mines.

(n) Cantagallo, Lima Department

The Company acquired one concession totaling 2 sq. km by staking in 2019.

(o) Other Income

Other income consists of proceeds from the sale of royalties or from the receipt of property option payments on certain properties in excess of costs previously incurred and deferred by the Company in respect of those interests.

8. RELATED PARTY TRANSACTIONS

CONDOR RESOURCES INC.
Notes to the Condensed Consolidated Interim Financial Statements(Unaudited, prepared by management and expressed in Canadian dollars)For the nine months ended November 30, 2020 and 2019
8.RELATED PARTY TRANSACTIONS
The following amounts are due to related parties and are included in trade payables and accruedliabilities:
The Company incurred the following transactions with directors and companies controlled by directors ofthe Company:	For the nine months ended November 30,
	2020	2019
Professional fees	$62,524	$40,544
Key management personnel compensation
	For the nine months ended November 30,
	2020	2019

The Company incurred the following transactions with directors and companies controlled by directors ofthe Company:
	For the nine months ended November 30,
Professional fees	$62,524$	40,544
Key management personnel compensation
	For the nine months ended November 30,
	2020	2019
Management fees	$119,370$	118,716
	56,173	55,648
Management fees capitalized to mineral properties		-
Management stock-based compensation	195,629

9. Loan

During the nine months ended November 30, 2020, the Company obtained an unsecured $40,000 loan as part of the Canadian government's economic response plan to the COVID-19 pandemic. The loan is interest free and is eligible for 25% forgiveness if $30,000 is fully repaid by December 31, 2022. If not repaid in full by the maturity date, the loan will be converted into a loan at a fixed interest rate of 5% per annum with a maturity date of December 31, 2025.

10. CAPITAL STOCK AND CONTRIBUTED SURPLUS

CONDOR RESOURCES INC.Notes to the Condensed Consolidated Interim Financial Statements(Unaudited, prepared by management and expressed in Canadian dollars)For the nine months ended November 30, 2020 and 2019
10.CAPITAL STOCK AND CONTRIBUTED SURPLUS
	Number ofshares	Share Capital	ContributedSurplus
Authorized:
Unlimited common shares
Issued:
Balance as at February 28, 2019	104,557,308	$20,585,363	$3,509,063
Private placement	4,000,000	200,000	-
Share issuance costs	-	(7,498)	-
Options exercised	670,000	33,500	-
Fair value of options exercised	-	22,022	(22,022)
Stock based compensation	-	-	28,769
Balance as at February 29, 2020	109,227,308	$20,833,387	$3,515,810
Private placement	13,200,000	990,000	-
Share issuance costs	-	(29,999)	-
Options exercised	1,645,000	113,750	-
Fair value of options exercised	-	76,048	(76,048)
Stock based compensation	-	-	248,687
Balance as at November 30, 2020	124,072,308	$21,983,186	$3,688,449

(a) Share Issuances

During the nine months ended November 30, 2020:

• i. the Company completed a private placement consisting of 13,200,000 units priced at $0.075 per unit for gross proceeds of $990,000. Each unit consisted of one common share and one common share purchase warrant. Each warrant is exercisable into one common share for a period of three years, with an exercise price of $0.115 per share during the first year, and then $0.15 thereafter. Insiders of the Company purchased 600,000 units of the private placement;
• ii. 1,645,000 incentive stock options were exercised for gross proceeds of $113,750.

During the year ended February 29, 2020:

• iii. In November 2019, the Company completed a private placement consisting of 4,000,000 units priced at $0.05 per unit for gross proceeds of $200,000. Each unit consisted of one common share and one common share purchase warrant. Each warrant is exercisable at $0.10 into one common share for a period of three years. No commissions or finder's fees were paid in connection with the private placement; and
• iv. In January 2020, 670,000 stock options were exercised for gross proceeds of $33,500. $22,022 was transferred from contributed surplus to share capital, being the fair value of the stock options exercised.

Notes to the Condensed Consolidated Interim Financial Statements (Unaudited, prepared by management and expressed in Canadian dollars) For the nine months ended November 30, 2020 and 2019

10. CAPITAL STOCK AND CONTRIBUTED SURPLUS (continued)

(b) Stock Options

The Company has a stock option plan (the "Plan") whereby the Company may grant stock options to eligible employees, officers, directors and consultants at an exercise price to be determined by the board of directors, provided the exercise price is not lower than the market value at time of issue. The Plan provides for the issuance of up to 10% of the Company's issued common shares as at the date of grant with each stock option having a minimum term of five years. The board of directors has the exclusive power over the granting and vesting of options subject to exchange rules.

During the nine months ended November 30, 2020:

• i. 1,645,000 stock options were exercised for gross proceeds of $113,750;
• ii. the Company granted 3,475,000 incentive stock options with an exercise price of $0.10, expiring on June 19, 2025; and
• iii. The Company recognized stock-based compensation expense of $248,687.

During the year ended February 29, 2020:

• iv. 670,000 stock options were exercised for gross proceeds of $33,500;
• v. 1,065,000 stock options with a weighted average exercise price of $0.10 expired unexercised;
• vi. The Company recognized stock-based compensation expense of $28,769.

	expiring on June 19, 2025; and
iii.	The Company recognized stock-based compensation expense of $248,687.
	During the year ended February 29, 2020:
iv.	670,000 stock options were exercised for gross proceeds of $33,500;
v.	1,065,000 stock options with a weighted average exercise price of $0.10 expired unexercised;
vi.	The Company recognized stock-based compensation expense of $28,769.
	Stock option transactions and the number of stock options outstanding are summarized as follows:
			Weighted Average
		Number of Options	Exercise Price
	Outstanding at February 28, 2019	9,430,000$	0.09
Exercised	Expired/cancelled/forfeited	(670,000)(1,065,000)	0.050.10
	Outstanding at February 29, 2020	7,695,000$	0.09
Granted		3,475,000	0.10
Exercised		(1,645,000)	0.07

Notes to the Condensed Consolidated Interim Financial Statements (Unaudited, prepared by management and expressed in Canadian dollars) For the nine months ended November 30, 2020 and 2019

10. CAPITAL STOCK AND CONTRIBUTED SURPLUS (continued)

(b) Stock Options (continued)

At November 30, 2020, the Company had the following incentive stock options outstanding entitling the holders thereof to acquire the following common shares in the Company: {Q2 statements show 840,000 $0.08 options??}

Notes to the Condensed Consolidated Interim Financial Statements
(Unaudited, prepared by management and expressed in Canadian dollars)
CAPITAL STOCK AND CONTRIBUTED SURPLUS (continued)
At November 30, 2020, the Company had the following incentive stock options outstanding entitling theholders thereof to acquire the following common shares in the Company: {Q2 statements show 840,000
Number of Options	Exercise Price	Expiry Date
860,000	$0.05	March 9, 2021
880,000	$0.08	August 11, 2021
3,660,000	$0.12	September 21, 2022
500,000	$0.07	February 13, 2024
150,000	$0.06	February 13, 2024
3,475,000	$0.10	June 18, 2025

	9,525,000
	8,775,000 incentive stock options were exercisable at November 30, 2020. The weighted averageremaining life of the outstanding incentive stock options at November 30, 2020 was 2.66 years (February
29, 2020 – 2.4 years).
	(c) Share Purchase Warrants
	Share purchase warrant transactions are summarized as follows:
			Weighted
			Average
		Number of Warrants	Exercise Price
	Outstanding at February 28, 2019	8,966,667	$0.14
issued		4,000,000	0.10
Expired		(2,300,000)	0.10
	Outstanding at February 29, 2020	10,666,667	$0.13
Issued		13,200,000	0.115

Notes to the Condensed Consolidated Interim Financial Statements (Unaudited, prepared by management and expressed in Canadian dollars) For the nine months ended November 30, 2020 and 2019

Number of Warrants	Exercise Price	Expiry Date
6,666,667	$0.15	February 9, 2022
4,000,000	$0.10	November 8, 2022
13,200,000	$0.115*	June 18, 2023

Share purchase warrants outstanding at November 30, 2020 are:

* The exercise price of these warrants is $0.115 per share until June 18, 2021, and $0.15 thereafter until expiry.

11. FINANCIAL INSTRUMENTS, MANAGEMENT OF CAPITAL AND FINANCIAL RISK

Fair value

All financial instruments are included on the Company's statement of financial position and are measured at either fair value or amortized cost.

The Company's financial instruments consist of cash and cash equivalents, accounts receivable (excluding sales taxes receivable), marketable securities and accounts payable and accrued liabilities. The fair values of accounts receivable and accounts payable and accrued liabilities are approximately equal to their carrying value due to their short-term nature.

Financial instruments measured at fair value on the statement of financial position as at November 30, 2020 and as at February 29, 2020 are all classified as Level 1.

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

Credit risk

Credit risk is the risk of loss associated with a counter party's inability to fulfill its payment obligations. The Company's credit risk is primarily attributable to cash and cash equivalents. Management believes that the credit risk concentration with respect to cash and cash equivalents is remote as it maintains accounts with highly-rated financial institutions.

Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its obligations as they become due. The Company's approach to managing liquidity risk is to ensure that it will have sufficient liquidity to meet liabilities when they come due. As at November 30, 2020 the Company had a cash and cash equivalents balance of $471,235 to settle current liabilities of $64,654. All of the Company's financial liabilities are subject to normal trade terms.

Market risk

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

Notes to the Condensed Consolidated Interim Financial Statements (Unaudited, prepared by management and expressed in Canadian dollars) For the nine months ended November 30, 2020 and 2019

(a) Interest rate risk

The Company has cash and cash equivalents and no interest-bearing debt. The Company's current policy is to invest excess cash and cash equivalents in investment-grade short-term deposit certificates issued by its banking institutions. The Company periodically monitors the investments it makes and is satisfied with the credit ratings of its bank. As at November 30, 2020, the Company had $351,248 in interest bearing cashable on demand investment grade guaranteed investment certificates.

11. FINANCIAL INSTRUMENTS, MANAGEMENT OF CAPITAL AND FINANCIAL RISK (continued)

(b) Foreign currency risk

The Company is exposed to foreign currency risk on fluctuations related to cash, receivables and accounts payable and accrued liabilities that are denominated in United States Dollars and Peruvian Soles. Management believes the risk is not currently significant as approximately 17% of the Company's cash and 15% of its liabilities are denominated in United States Dollars and Peruvian Soles as at November 30, 2020.

(c) Price risk

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

(d) Political Uncertainty

In conducting operations in Peru, the Company is subject to considerations and risks not typically associated with companies operating in North America. These include risks such as the political, economic and legal environments. Among other things, the Company's results may be adversely affected by changes in the political and social conditions in Peru, and by changes in governmental policies with respect to mining laws and regulations, anti-inflationary measures, currency conversion and remittance abroad, and rates and methods of taxation.

12. SUPPLEMENTAL DISCLOSURE WITH RESPECT TO CASH FLOWS

As at November 30, 2020, there was $9,458 (November 30, 2019 - $2,085) of exploration and evaluation expenditures included in accounts payable and accrued liabilities.

During the nine months ended November 30, 2020, amortization expense of $2,232 (November 30, 2019 - $2,139) was capitalized to mineral properties.

In April 2019, the Company received 900,000 common shares of Chakana at a fair value of $378,000 pursuant to the Soledad property option agreement described in Note 7(f).

Notes to the Condensed Consolidated Interim Financial Statements (Unaudited, prepared by management and expressed in Canadian dollars) For the nine months ended November 30, 2020 and 2019

13. CAPITAL MANAGEMENT

The Company manages its capital structure and makes adjustments to it, based on the funds available to the Company, in order to support the acquisition, exploration and development of mineral properties and to maintain its ability to continue as a going concern. The Board of Directors does not establish quantitative return on capital criteria for management, but rather relies on the expertise of the Company's management to sustain future development of the business.

The properties in which the Company currently has an interest are in the exploration stage, and as such, the Company has historically relied on the equity markets to fund its activities. In addition, the Company is dependent upon external financings to fund activities. In order to carry out planned exploration and pay for administrative costs, the Company will spend its existing working capital and raise additional funds as needed. The Company will continue to assess new properties and seek to acquire an interest in additional properties if it feels there is sufficient geologic or economic potential and if it has adequate financial resources to do so.

Management reviews its capital management approach on an ongoing basis and believes that this approach, given the relative size of the Company, is reasonable. The Company is not subject to externally imposed capital requirements and the Company's overall strategy with respect to capital risk management and remained unchanged during the nine months ended November 30, 2020 and the year ended February 29, 2020.

14. COVID-19

Since March 2020, the outbreak of the novel strain of coronavirus, specifically identified as "COVID-19", has resulted in governments worldwide enacting emergency measures to combat the spread of the virus. These measures, which include the implementation of travel bans, self-imposed quarantine periods and physical distancing, have caused material disruption to business globally resulting in an economic slowdown. Global equity markets have experienced significant volatility and weakness. The duration and impact of the COVID-19 outbreak is unknown at this time, as is the efficacy of the government and central bank interventions. It is not possible to reliably estimate the length and severity of these developments and the impact on the financial results and condition of the Company in future periods.

15. SUBSEQUENT EVENTS

Subsequent to November 30, 2020, the Company:

• i. received US $150,000 from Chakana per the terms of the Soledad Agreement (Note 7(f)(ix));
• ii. received US $90,000 from Calipuy per the terms of the Lucero agreement (Note 7(h)).