Dios Exploration — Interim / Quarterly Report 2021

May 20, 2021

DIOS EXPLORATION INC. - Management’s Discussion & Analysis – Quarterly Highlights – March 31, 2021

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DIOS EXPLORATION INC. Management’s Discussion and Analysis Quarterly highlights For the three-month period ended March 31, 2021

The following quarterly highlights of management discussion and analysis of the financial condition and results of operations of Dios Exploration Inc. ((the “Company” or “Dios”) constitute management’s review of the factors that affected the Company’s financial operating performance for the three-month period ended March 31, 2021 (“2021-Q1”).

This discussion and analysis should be read in conjunction with:

• The unaudited interim financial statements for 2021-Q1;

• The 2020 Annual Management report; and

• The Company’s audited financial statements for the year ended December 31, 2020 and December 31, 2019.

These documents and additional information may be available through www.sedar.com web site, under the Company’s section “Sedar filing” or at www.diosexplo.com. Dios’ shares are traded on TSX Venture Exchange under DOS symbol and 101,207,066 shares were issued and outstanding as at March 31, 2021.

Nature of activities

Dios focuses on gold exploration in James Bay Eeyou Istchee, Quebec. Wholly-owned K2 and Solo gold-copper-silver claim block without any royalties is located directly SW in strike of Azimut’s Elmer gold discovery at Patwon. Very significant results were obtained on K2 project with Kali eastern targets and WI gold targets, west of Kali intrusive.

Dios is involved in mineral exploration along a major James Bay deformation zone through proprietary till sampling defining gold glacial dispersal trains. Successful drilling of large AU33 gold property led to HEBERTO GOLD discovery, then 4 km NNE, to successful drilling of CLN area and a further 4-5 km east to WTS gold drilling discovery.

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DIOS EXPLORATION INC. - Management’s Discussion & Analysis – Quarterly Highlights – March 31, 2021

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Gold in outcrop was also thus discovered by Dios on Clarkie (8.9 & 6.8 g/tAu) and Le Caron (37 g/t Au, 4.5 m @ 2.1 g/t Au) gold projects, along Newmont Eleonore gold mine - Cheechoo corridor. Gold in outcrop and by drilling was also discovered by Dios 6 km northwest of Eastmain gold mine on Dios’ 33 Carats property, farmed out in 2020.

Investing activities

In 2021-Q1, Dios paid $13,908 for mining rights (claim renewal and acquisitions) compared to $558 for the same period last year.

During the three-month period ended March 31, 2021, the Company incurred $127,083 in exploration expenses compared to $22,931 for the same period in 2020.

Exploration Expense Analysis

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Description K2 14 Karats Total
$ $
Geology 37,425 33,463 70,888
Transportation, Lodging 192 - 192
-
Assays 55,656 55,656
Office and other 347 - 347
93,620 33,463 127,083
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DIOS EXPLORATION INC. - Management’s Discussion & Analysis – Quarterly Highlights – March 31, 2021

Exploration performed during the quarter

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K2 gold project

Wholly-owned K2 gold project directly borders to the southwest Azimut’s Elmer gold property hosting Patwon gold discovery , along same trend of Opinaca River deformation Zone, an underexplored part of the Lower Eastmain Greenstone belt, James Bay, Quebec.

K2 covers 85 sq. km around Kali pluton and was for the first time ever drilled in very late 2020. Due to lab delays, assays were undertaken in 2021 at ALS laboratory, Val d’Or, QC.

K2 and Solo geology is favourable for VMS (Volcanic Massive Sulfides) and Windfall-type gold mineralization. K2 hosts an Archean volcanic sequence injected by felsic porphyry plugs and dykes wrapped around Kali tonalite pluton. A dozen electromagnetic anomalies prospective for low sulfide content and extents in mixed volcanics were identified and 2020 research confirmed potential of non-outcropping WI-Target , a possible gold-silver-copper VMS mineralized system (telescoped Doyon/Westwood +/-Bousquet-type). Dios completed a ground induced polarization survey on that 3 km long conductor (Dipole-dipole & pole-dipole arrays).

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DIOS EXPLORATION INC. - Management’s Discussion & Analysis – Quarterly Highlights – March 31, 2021

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Good gold-in-soil anomalies (up to 283 ppb gold in B-horizon) coupled with cm-m sericite & silicified dacite floats (volcanic with 2-10% sulfide & quartz stringers (up to 6.72 g/t gold) are hosted in glacial drumlins directly adjacent to 3 km-long electromagnetic airborne IP conductor and PP-1 ground IP anomaly.

About 200 m SE of WI-Target, the cinnamon showing within Kali Tonalite yielded 10 g/t gold, 1.81, 0.68, 0.62, 0.47 g/t Au in a shear of same orientation as WI-Target, confirming strong potential of adjacent underexplored western intrusion-volcanic contact.

- Two parallel gold bearing zones were discovered by drilling this area.

First , on PP-1 ground anomaly, 1.5 km west of Kali intrusive, a poorly outcropping area, hole 01 intersected medium-coarse grained tonalite-diorite grading 8.92 g/t gold over 1 m (352-353m) in contact with a strongly foliated mafic dyke with 0.5% pyrite-pyrrhotite disseminated in foliation. Open in all directions, it seems associated with the hanging wall of a significant resistivity anomaly, at the contact between a high and low magnetic area.

Hole 03, located 200 m northeast, cut 0.5 g/t gold/1m (183-184m) in another such IP horizon, but also no volcanic rocks that could explain soft & crumbly mineralized/sericitic dacite boulders grading up to 6.72 g/t gold in the WI target area . Good NE up-ice targets such as:

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DIOS EXPLORATION INC. - Management’s Discussion & Analysis – Quarterly Highlights – March 31, 2021

1.) significant 10 - 20 meters large goldbearing Curcuma shear zones, grading as of now gold in outcrop such as 1.12 g/t Au and

2.) southern contact between Kali pluton and adjacent volcanics (along enriched gold-in-till drumlin feature) remains untested. So further soil and rock sampling and IP survey is warranted in that NE area to define further drill targets.

Second , the other gold zone was drill discovered 800 m south-east of hole 01in wider WI TARGET area (8 holes over 1.5 by 1 km). More precisely on PP-2 anomaly, hole 05 hit an intercept of 3.78 g/t gold over 1 m related to feldspar diorite & foliated gabbro contact and 0.5 percent pyrite (129-130 m). PP-2 gold intercept is striking as cinnamon showing shear grading 10 g/t gold.

On PP-3 ground IP anomaly, hole 07 cut sections of fractured sheared gabbro with 1% pyrrhotite & traces chalcopyrite (48.30-57.00m; 82.75-91.25m). On PP-4, hole 08 intersected several foliated basic dykes (1-6.3 m thick) hosting 2-4% quartz-carbonate stringers with 1% pyrite within 10-20 meters intervals of fractured tonalite. Another foliated & fractured section (143-165.50m) of biotitized tonalite hosts 2% quartz-carbonate stringers & 1% pyrite.

Several other areas of K2-Solo property warrant further ground investigations and drilling.

The Attila gold-copper showing is hosted in fractured rhyodacite dome overlying Kali quartzdiorite/tonalite porphyry to the south, 7 km east of WI-Target tonalite contact. It is a chalcopyriterich stringer/ stockwork over 75 m long by 5-15 m wide yielding up to 8.08 g/t gold, 96.7 g/t Ag, 2.43% Cu & 0.17% Zn.

DIRECTLY ADJACENT SOUTH, STILL IN FELSIC VOLCANICS NORTH OF OPINACA FAULT, LIES A LARGE AREA COVERED BY MARINE CLAYS HARDLY IMPOSSIBLE TO SAMPLE. THIS AREA IS ITSELF BORDERED TO THE SOUTH BY A MAJOR 5 KM LONG HYDROTHERMAL SERICITE ALTERATION CORRIDOR. THIS STRATEGIC AREA IS PLANNED TO BE SURVEYED BY GROUND IP FOR TARGET DRILLING.

In early February 2021, partner on Solo SE claim block, further southeast, south of Opinaca fault, did not pursue its option agreement and Dios recovered whole Solo claim block.

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DIOS EXPLORATION INC. - Management’s Discussion & Analysis – Quarterly Highlights – March 31, 2021

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Dios identified very strong first priority IP anomalies in southeastern K2, with good related gold, copper and As in-soil anomalous clusters.

A very significant km size target (A48) was defined and is composed of a cherty iron formation with pyrite and graphite within mafic volcanic flows and tuffs, near Opinaca Fault and crosscutting structures. It is coincidental with a 3.5 km-long minimum VLF-EM conductor associated with a good magnetic lineament . Its northeastern limit, covered by an Induced Polarization IP survey (Barrick 1997), is coincidental with a very good chargeable conductor (P11 goes from 7 to 50 mV/V) .

B-horizon sampling across this unit produced anomalous clusters along the VLF-EM conductor with such gold values (6, 12, 18, 120, 240 ppb Au in one line & 30, 54 ppb Au 200 m away) as well as copper values 400 m away (140, 150, 150 ppm Cu & 450 ppm Cu. Additional B- horizon sampling and prospecting over the VLF/magnetic lineament is planned this summer. Testdrilling is also being evaluated for this summer. At the regional scale, such sulphides-bearing cherts are known to be goldbearing (Lidge:11.42 g/t Au/1.3 m; Lucille: 1.24 g/t Au/4 m).

This several km long gold-copper target area is pointed at with several combined methods. An independent geophysicist report mentions strongly chargeable P-11 should be drilled, specially as it is also associated with major resistivity decreases, typical of good conductors, such as massive sulfides. Further south, P-07 also bears same characteristics of massive sulfides.

Effectively, some 800 m south of P-11, three sub-parallel several km long IP conductors are coincidental with a moderate east-west gold soil anomaly (regional and detailed, see figure above).

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DIOS EXPLORATION INC. - Management’s Discussion & Analysis – Quarterly Highlights – March 31, 2021

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Both geophysical and geochemical anomalies are located along the northern flank of a regional fold hinge (structural trap), and may correspond to a sulfurized contact between felsic tuffs and intermediate volcanics. Most chargeable P-07 (7 to 130mV/V) conductor is coincidental with a 3 km-long high magnetic feature. Winter drilling is planned on swampy P-07 (&P-06).

Overall performance

Net loss for the quarter is $114,176 (net loss of $37,875 for the first quarter 2020) whereas expenses for the quarter totalled $117,505 ($38,628 for the first quarter 2020).

• Increase of stock-based compensation expenses. See the table below.

• Increase in Professional fees due to the timing of audit fees invoiced.

• Decrease in Office expense: Finalization of a new website last year.

• Analysis of the non-monetary operations that does not require an exit or an inflow of cash (positive: income and negative: expenditure):

	Quarter ended March 31, 2021 $	Quarter ended March 31, 2020 $
Stock-based payments	77,747	-

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DIOS EXPLORATION INC. - Management’s Discussion & Analysis – Quarterly Highlights – March 31, 2021

Financial position

• Working capital decreased by $ 158,617 as at March 31, 2021 going from $1,570,206 as at December 31, 2020 to $ 1,411,589 as at March 31, 2021. The decrease is mainly due to exploration costs, mining right payments and administrative expenses incurred during the period.

• Cash and term deposit amount to $ 1,358,432 as at March 31, 2021 compared to $ 1,931,479 as at December 31, 2020. The Company is considered to be in the exploration stage, thus it is dependent on obtaining regular financing in order to continue exploration. Despite previous success in acquiring sufficient financing, there is no guarantee of obtaining any future financing.

Exploration Budget for fiscal 2021: planned exploration work to be conducted by Dios in 2021 is disclosed in the 2020 Annual Management report. See above section "Exploration performed during the quarter”. During the quarter, the company had to restrict exploration work on its mining properties due to containment measures relating to COVID-19 pandemic.

Related party transactions

Key management personnel of the Company are members of the Board of Directors, as well as the President, the Chief Financial Officer and the Vice-President, operations. Key management personnel remuneration includes salaries, consulting fees and share-based payments. For the 2021Q1, the compensation is $ 76,427 ($ 17,706 for the same period last year). An amount of $ 52,985 ($ 10,956 for the same period last year) was capitalized in Exploration and Evaluation assets.

Forward-looking information

See the forward-looking information in the 2020 Annual Management report.

Montreal, Quebec May 20, 2021

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