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First Lithium Minerals Corp. — Management Reports 2026
May 19, 2026
45966_rns_2026-05-19_e0b5027a-8eed-4d20-ad3b-850f764a9928.pdf
Management Reports
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First Lithium
FIRST LITHIUM MINERALS CORP.
MANAGEMENT'S DISCUSSION AND ANALYSIS
FOR THE PERIOD ENDED MARCH 31,2026
DATED MAY 19, 2026
Disclosure Regarding Forward-Looking Statements
This Management's Discussion and Analysis contains forward-looking statements that include risks and uncertainties that are disclosed under the section Risk Factors. Other factors that could affect actual results are uncertainties pertaining to government regulations, both domestic as well as foreign, and the changes within the capital markets. Other risks may be disclosed from time to time in First Lithium Minerals Corp.'s public disclosures.
First Lithium Minerals Corp.
Management's Discussion and Analysis
Table of Contents
ITEM 1 - Overview ... 3
ITEM 2 - Selected Annual Information ... 7
ITEM 3 - Results of Operations ... 7
ITEM 4 - Summary of Quarterly Results ... 9
ITEM 5 - Liquidity ... 10
ITEM 6 - Capital Resources ... 10
ITEM 7 - Off-Balance Sheet Arrangements ... 11
ITEM 8 - Transactions With Related Parties ... 11
ITEM 9 - Proposed Transactions ... 12
ITEM 10 - Risk Factors ... 12
ITEM 11 - Critical Accounting Estimates ... 16
ITEM 12 - Changes in Accounting Policies ... 16
ITEM 13 - Financial Instruments and Other Instruments ... 16
ITEM 14 - Capital Structure ... 16
First Lithium Minerals Corp.
Management's Discussion and Analysis
Unless otherwise indicated, in this Management's Discussion and Analysis ("MD&A") all references to "dollar" or the use of the symbol “$” are to the Canadian Dollar.
The preparation of the financial statements are in conformity with IFRS Accounting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB") and requires management to make assumptions that affect the reported amounts of assets, liabilities and expenses in addition to the disclosure of contingent liabilities at the date of the financial statements. First Lithium Minerals Corp. (the "Corporation" or "FLMC" or "PCG") bases its estimates on historical experience, current trends and various other assumptions that are believed to be reasonable under the circumstances. Actual results could differ and will most likely differ from those estimates.
ITEM 1 - Overview
The Corporation was incorporated under the Alberta Business Corporations Act on March 25, 1993 and on June 30, 2022, filed articles of amendments to change its name from Petrocorp Group Inc. ("PCG") to First Lithium Minerals Corp. and to continue under the Ontario Business Corporations Act.
In 2018, First Lithium Minerals Inc. ("FLMI") initiated staking mineral exploration concessions on the salars of Ollague, Carcote and Ascotán ("OCA Ascotan Project"), in the Antofagasta Region II of Chile. The prospect area is approximately 215 km northeast from the city of Calama, within the cordilleran sector, bordering Bolivia and is accessible via paved highway. The OCA Ascotan Project is 8,175 hectares, spans the three salars, and is approximately 350 km from the port city of Tocopilla.
In 2022, the Corporation staked an additional 200 Ha, the Lucia Property located at the commune of San Pedro de Atacama, Calama, Province of El Loa, II Region of Antofagasta, Chile, within the Salar de Capur.
Going Public Transaction
On July 28, 2022, PCG closed its reverse takeover ("RTO") transaction with First Lithium Minerals Inc., immediately prior to the RTO, FLMI merged with QL Minerals Inc. ("QLM"), (collectively the "Transaction").
Prior to the Transaction;
- PCG consolidated its common shares on a basis of 81.96721311 old common shares for 1 new common share;
- FLM consolidated its shares on a basis of 2.5 old common shares for 1 new common share prior to merging with QLM;
- FLMI settled $3,571,591 in liabilities via the issuance of its new common shares at a deemed price of $0.225 per share; and
- FLMI raised $5,914,500 via the issuance of subscription receipts that converted into 23,658,000 new common shares of FLMI on the closing of the Transaction.
Once consolidated, all shareholders exchanged their shares for shares of the resulting issuer. Commencement of trading began on August 9, 2022, under the symbol FLM on the Canadian Securities Exchange. The common shares of the Corporation also trade in the United States under the symbol FLMCF and on the FSE under the symbol X28.
OCA Ascotan Project
The OCA Ascotan Project is located within the "Lithium Triangle" of South America, which includes parts of the Andean Region of Chile, Bolivia and Argentina, where closed evaporate basins have allowed the development of a series of brine deposits in the form of dry salt lakes or terminal 'playas'. The OCA Ascotan Project is located in the Antofagasta Region, Chile, approximately 215 km northeast of the city of Calama, in the border area with Bolivia, in the municipality of Ollague, and is approximately 350 km from Tocopilla, the closest commercial port on the Pacific Ocean. Access to the OCA Ascotan Project from the city of Calama is expeditious, through paved roads and highways, with small extensions of dirt roads passable throughout the year, which allow direct access to the sectors of interest. The travel time to access each of the three salars of interest is approximately 2.5 hours by car from Calama. Calama is an active commercial mining center with developed industrial, mining, and commercial infrastructure. Power and transportation infrastructure are present and well developed in the area. The Ferrocarril de Antofagasta a Bolivian railway that runs through Ollague, Chile, forms a major transportation corridor between
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First Lithium Minerals Corp.
Management's Discussion and Analysis
the seaport city of Antofagasta, Chile and the capital of Bolivia, La Paz. Cerro Pabellon Geothermal Power Plant is located approximately 70 km south of the southern border of the OCA Project area. The OCA Ascotan Project belongs to the domain of the Andean Salars, which main economic interests are sodium, potassium, lithium, magnesium, and borate salts (Sernageomin, 2014).
In November 2022, the Corporation initiated geophysical surveying programs and conducted a project site visit to continue exploration activities, mapping, and geologic surveying. The geophysical surveys program comprised data collection of contiguous 200m coincident loop measuring vertical (Z) component dB/dt TEM along 500 to 1,000m spaced lines over selected exploration concessions at the salars of Ollague, Carcote, and Ascotan. The Company acquired resistivity data over a total of 267 TEM contiguously spaced stations along 28 profiles for a total of 47.8 line-km.
The property-wide Transient Electromagnetic ("TEM") geophysical surveys identified multiple low resistivity zones across several prospective areas. The Company believes the discovered zones are indicative of characteristics typically exhibited by mineralized saline aquifers of hydrogeological conditions of northern Chile. The geophysical surveys indicated highly conductive horizontal zones of less than 1.0 Ohm-meter of up to 400 metres (m) in thickness, from about 100-200m beneath the surface. Specifically, two sectors, the northeastern property areas at the salar de Carcote (approx. 1,275 ha) and salar de Ascotan (approx. 1,775 ha) displayed promising geophysical characteristics with responses as low as 0.2 Ohm-meters identified as priority high conductivity targets for continuing exploration as prospective mineralized saline aquifers.
In January 2023, the Corporation conducted Magneto-Telluric ("MT") geophysical surveys. The MT geophysical survey program was comprised of data collection of 60 Tensor MT sites spaced 600m along 8 lines on two identified sectors at the northeastern prospect areas at the salar de Ascotan (approx. 1,775 ha), salar de Carcote (approx. 1,275 ha), and the southern prospect area of the salar de Ollague (approx. 300 ha). The results of the MT geophysical survey program indicated highly conductive zones of less than 1.0 Ohm-meter signatures, which are typically associated with brine mineralization in hydrogeologic settings across the Andean plateau. Preliminary hydrogeological modelling suggests a gradually increasing brine signature starting at approximately 200 meters beneath the surface with thickness up to 400 meters reaching a consolidated lacustrine base or bedrock at approximately 600 meters at depth. The resistivity data collected by the surveys provided a better understanding of the prospects' lithology, sediments, potential brine signatures, and enhanced geological modeling.
In May 2023, the Corporation completed its drill target assessment and is planning to proceed to its inaugural brine resource exploration program in the northeastern property areas at the salar de Ascotan (approx. 1,775 ha), which displays promising geophysical characteristics based on the Transient Electromagnetic ("TEM") and MT geophysical surveys conducted in Q4/22 and Q1/23 respectively.
The initial exploration program will consider up to five boreholes to depths of up to 500 meters. Depending on lithology and hydrogeological conditions encountered, it is envisaged that the holes will be drilled with a combination of PQ and HQ core sizes using plastic liners to facilitate core recovery for geological assessment and drainable porosity analysis. Brine sampling is planned at 12 meter intervals using bailer, packer, or other suitable methodology depending on lithology and hydrogeological conditions.
In August 2023, the Corporation's management met with the Quechua Cebollar-Ascotan Indigenous Community on the envisioned exploration activities, visited the proposed sites for a drilling program, and discussed the areas and elements of future cooperation and engagement.
In September 2023, the Corporation completed a selective geochemical surface sampling program at the Salar de Ascotan. A total of 15 brine and brackish water samples were collected directly off the surface in the salar at depths of up to 0.3 meters and in the alluvium surrounding the salar surface. Results from AGS Laboratory, Coquimbo, Chile assays of the complete sample set range from trace to 78 Li (mg/L), with an average of 42.6 Li (mg/L) and median of 57.3 Li (mg/L). Potassium assay values averaged 1,042.8 K (mg/L) with a median at 1,445 K (mg/L), and Boron averaged 705.1 B (mg/L) with a median of 1,003.3 B (mg/L). As total dissolved solids (TDS) concentrations increase with depth in common hydrogeological settings of northern Chilean salars, the geochemical results are congruent with the expectation that lithium and alkaline metals should be present in higher concentrations at depth.
In September 2023, the Corporation had applied for a regulatory environmental assessment permit and in March 2024, the Corporation announced that it received a favourable official response to its "Consulta de Pertinencia de
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First Lithium Minerals Corp.
Management's Discussion and Analysis
Ingreso al SEIA del Proyecto de Sondajes OCA" (the "Environmental Approval"). The response stated the Corporation is not obliged to enter the Environmental Impact Assessment System "Sistema de Evaluación de Impacto Ambiental" ("SEIA") to conduct its drilling program on the Corporation's exploration concessions at the Salar de Ascotan.
In March 2024, upon the receipt of the Environment Approval, the Corporation entered into a Cooperation Agreement with the Cebollar-Ascotan Indigenous Community for the formation of a long-term mutually beneficial partnership. The community is expected to benefit from the participation in the employment opportunities and social infrastructure improvements.
In April 2025, the Corporation announced results from a semi-systematic near surface sediment geochemical survey over the geophysical and drill targets at its 100% owned OCA Ascotan Project in the Antofagasta Region of northern Chile. 50 samples were collected and analyzed by ICP-MS with digestion in aqua regia for 60 elements, including elements of interest, namely, Li, B, Mg, K, Ca and Na. The maximum lithium and boron values returned were 245 ppm of Li and 2,420 ppm of B, respectively, and were recorded in the central west section of the project, in the proposed drill target sector. Elevated boron values also assayed in the southern section of the project.
In Q3/25, the global lithium market continued to experience a period of suppressed prices. The Electric Vehicle ("EV") demand was stable but growth rates have been below previous market forecasts and industry expectations. Slower global EV sales resulted in suppressed lithium demand in Q3/25. Lithium carbonate ("LCE") prices remained in a USD $8-$10/kg range. Lithium demand is expected to move LCE price higher as lithium supply is not expected to catch up to demand in the foreseeable future. While off the multi-year highs, Chile lithium carbonate producer contract prices remain supportive for brine producers.
During the year ending December 31, 2025, the Corporation decided not to renew 2,000 hectares of concessions relating to Salar de Carcote.
In 2025, the global lithium market began to experience a period of increasing lithium prices. The Electric Vehicle ("EV") demand was stable, however, growing demand for Energy Storage Systems ("ESS") for power grid bolstered the demand outlook for lithium and has become the fastest-growing demand segment, growing 71% in 2025 (Source, Reuters, January 5, 2026 based on UBS Data "Energy storage boom strengthens demand outlook for beaten-down lithium").
Other contributing factors for the increase in the price of lithium were production cuts and export bans. A major Chines producer CATL stopped its operations at its mine in mid-2025 resulting in a drop of global lithium supply (Source: Bloomberg, August 11, 2025. "Lithium Market Soars as CATL Shuts One of Worlds Top Mines"). Zimbabwe, Africa's largest lithium producer and a key supplier of lithium to China also suspended all exports of lithium concentrates in early 2026 to force domestic refining, immediately tightening the market (Source, Reuters February 25, 2026. "Zimbabwe bans exports of all raw minerals and lithium concentrates, cites malpractices").
Lithium carbonate ("LCE") prices increased from USD $10.1/kg at July 2025, which appeared to be a bottom to USD $14.4/kg at December 2025, a 42% increase. As at April 2026, LCE is trading at USD $25.3/kg (Source: Trade Economics, Company Reports). Lithium demand is expected to continue to move LCE prices higher as supply is not expected to catch up in the long-term.
In March 2026, Chile welcomed a new government. This new government is expected to have a more pro-investment and market-friendly approach which is expected to increase private capital inflows and reduce regulatory bottlenecks within the lithium industry in Chile.
Ontario Exploration - LSL
In June 2023, the Corporation acquired a 100% interest in 49 mineral claims for $372,500 that was settled with 4,300,000 common shares of the Corporation valued at $322,500 plus $50,000 in cash. Subsequently, the Corporation staked an additional 142 mining claims for a total of 191 mining claims (collectively the "LSL" property). The LSL property covers 3,913 ha and is made up of three claim groups, LSL Main, Solitude, and Hillside. The LSL is located approximately 160 km northeast of Sioux Lookout, Ontario, and has multiple areas of exploration interest. Historical exploration activities in the project area included geologic mapping, airborne gamma ray spectrometry, line-cutting, and core drilling. Historical drilling (1967-1968) identified multiple occurrences of pegmatites, including 98.4 ft of granite-pegmatite. The area also showed anomalous lake geochemistry lithium (Li) clusters and relevant
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First Lithium Minerals Corp.
Management's Discussion and Analysis
pathfinder elements, cesium (Cs) and tantalum (Ta), present in sediments, which can indicate coincident geochemical anomalies that could hold Li-Cs-Ta (LCT) pegmatite mineralization. During the period ended December 31, 2024, the Corporation wrote off $374,700 that covered 153 mining claims and an additional 28 mining claims during the period ending June 30, 2025 and the last 9 claims covering 184.88 ha were returned in August 2025.
Ontario Exploration - Lidstone
In December 2023, the Corporation acquired a 100% interest in 85 mining claims for $410,000 that was settled with 4,000,000 common shares of the Corporation valued at $360,000 plus $50,000 in cash. Subsequently, the Corporation staked 14 additional mining claims in 2023. In Q1 2024, the Corporation staked an additional 533 mining claims and in Q2 2024 the Corporation staked an additional 170 mining claims for a total of 802 mining claims (collectively the "Lidstone" property), and an additional 50 claims in Q3 2024. The Lidstone property is located 120 km northeast of the town of Armstrong, Ontario, which is approximately 270 km directly north of the City of Thunder Bay along Highway 527. Historical exploration work in the area indicated the presence of mafic-ultramafic intrusive rocks hosting anomalous Ni-Cu-PGE mineralization with anomalous lake geochemistry, lithium (Li) grade clusters. Historical drilling on the Lidstone claim block showed shallow, noticeable intercepts of biotite, which could be considered as pathfinders for a magmatic Ni-Cu-PGE sulphide mineralization. The prospect area also exhibited coincident magnetic abrupt highs and lows and zones of high electromagnetic (EM) conductance.
In January 2024, the Ontario Geological Survey (OGS) issued its 2023-2024 Recommendations for Exploration report based on the Resident Geologist Program using the existing OGS geological and mineral exploration data, along with field exploration activities. The occurrence highlighted lithium-cesium-tantalum (LCT)-type pegmatite potential in the Witchwood and Morden Lake Areas, Eastern English River Subprovince, which are located in the immediate area of the Company's Lidstone project.
In October 2024, the Corporation completed a flow-through financing for $40,000, via the issuance of 266,667 common shares at $0.15. The funds were used to conduct its first reconnaissance field exploration at Lidstone in October 2024 by visiting the property and collecting rock samples.
The results of the first field exploration on the prospect showed potential for gold mineralization. A sample from a white/translucent, barren quartz vein returned 0.272 g/t Au (see the Corporation's press release of March 3, 2025, which is incorporated by reference). The sample and surrounding geology will be further investigated for potential economic gold mineralization on the Lidstone property.
In March 2025, the Corporation acquired an additional 15 claims for $25,000 in cash to expand the Lidstone property to 867 claims covering 17,602 ha.
In September 2025, the Corporation raised $75,000 via a flow-through financing of $75,000 via the issuance of 937,500 common shares at $0.08. The funds were used to conduct its additional field exploration at Lidstone during the quarter ending December 31, 2025.
In October 2025, the Corporation launched its field exploration program at the Lidstone Project. The program prioritized exploration of the northern and central sectors of the greenstone belt, a target that is defined by abrupt high and low magnetic intensities and a historical quartz vein sampling of 0.272 g/t Au (Press Release, March 3, 2025 "First Lithium Minerals Discovers Gold Anomaly at its Lidstone Prospect in Ontario"). The Company's field efforts focused on prospecting, geochemical rock sampling, and geological mapping with the goal of identifying mineralization, alteration and structures conducive to gold or base metal deposition. Through this program, the Company expected to improve the geological understanding of the property and its potential to host gold or base metal mineralization. The program's ultimate objectives were to identify targets for further exploration, including drill targeting in 2026.
In December 2025, the Corporation decided to drop 467 claims (9,484.46 ha) to own a total of 400 claims covering 8,117.32 ha.
In January 2026, the Corporation obtained an additional 126 claims at a cost of $6,300 covering 2,556.6 ha to increase the Lidstone property to 526 claims over 10,673.94 ha.
In February 2026, the Corporation announced the results of the 2025 field exploration program conducted at the Lidstone Project (Press Release, February 3, 2026 "First Lithium Announces New Gold Discovery Up to 2.34 g/t and Additional Claims Staking at Lidstone Project"). A total of 229 samples were collected, representing 102 quartz veins,
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First Lithium Minerals Corp.
Management's Discussion and Analysis
112 metavolcanic-metasedimentary rocks, 7 granitic rocks, and 8 mafic-ultramafic intrusive rocks. Extensive sampling was carried out along the margins of an interpreted granite-greenstone belt contact, which is strongly delineated in the regional magnetic survey. Out of 225 samples, twelve samples assayed returned anomalous gold between 0.01-0.05 g/t Au, and one sample returned 2.34 g/t Au.
ITEM 2 - Selected Annual Information
The following is selected annual information for the preceding three fiscal years:
| December 31 | 2025 | 2024 | 2023 |
|---|---|---|---|
| Net revenues | $ nil | $ nil | $ nil |
| Net loss | 1,428,692 | 1,363,007 | 2,248,977 |
| Total assets | 1,531,493 | 2,782,220 | 4,056,767 |
| Long term liabilities | Nil | Nil | Nil |
| Loss per share | 0.01 | 0.01 | 0.03 |
| Cash dividends per share | 0.00 | 0.00 | 0.00 |
For further financial information, please refer to the Corporation's audited financial statements that have been filed on SEDAR.
ITEM 3 - Results of Operations
For the year ended December 31, 2025, versus December 31, 2024
The Corporation has no revenue-producing assets at this stage, as its mineral properties are all at the exploration and evaluation stage of development. The Corporation is currently enhancing shareholders' value by exploring its mineral assets and expanding its land exploration portfolio.
For the year ended December 31, 2025, the Corporation had general and administrative expenditures of $7,420 versus $9,768 the year earlier, for a positive variance of $2,348. This line item is below Management's expectation of approximately $10,000 to $15,000 annually as the Corporation continues to invest in exploration and evaluation to determine the viability of its properties; therefore, it is not anticipated to be a significant amount going forward.
For the year ended December 31, 2025, the Corporation had directors' fees of $30,000 versus $30,000 the year earlier.
For the year ended December 31, 2025, the Corporation had management fees of $240,000 versus $240,000 the year earlier.
For the year ended December 31, 2025, the Corporation had mineral exploration expenditures and operating expenses total of $585,113 versus $468,688 the year earlier, for a negative variance of $116,425 or 24.8%. Mineral expenditures include all costs related to exploration and analysis of the various properties, but exclude the cost of acquiring, staking, land management and property taxes. Management anticipates that this line item will increase and fluctuate significantly as the Corporation invests in exploration and evaluation to determine the viability of its properties. In addition, the Corporation may acquire additional properties should the opportunity arise to enhance shareholder value as it has in the past.
For the year ended December 31, 2025, the Corporation had professional expenditures of $221,132 versus $224,850 the year earlier, for a positive variance of $3,718 or 1.7%. Management anticipates this line item to be approximately $200,000 to $250,000 annually, unless a transaction outside the normal course of business occurs, which would be incremental.
For the year ended December 31, 2025, the Corporation incurred regulatory and shareholder expenses of $92,807 versus $140,691 the year earlier, for a positive variance of $47,884 or 34.0%. This expense line item includes all regulatory expenses, such as exchange fees, transfer agent fees, shareholder communications and investor
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First Lithium Minerals Corp.
Management's Discussion and Analysis
relations. Management anticipates this line item to be approximately $150,000 to $200,000 annually, and that this year was an anomaly as the Lithium market was not on investors' minds for most of the year.
For the year ended December 31, 2025, the Corporation had an operating loss of $1,176,472 versus $1,113,997 the year earlier, for a negative variance of $62,475 or 5.6%. Management anticipates that the operating loss will continue as it carries out the proposed exploration and evaluation of mineral properties, as this amount is expensed to operations as incurred, as permitted by IFRS 6.
For the year ended December 31, 2025, the Corporation had a foreign exchange gain of $1,107 versus a loss of $1,383 the year earlier, for a positive variance of $2,490. The foreign exchange is generally related to the operating activities of the Corporation's Chilean operations.
For the year ended December 31, 2025, the Corporation had an interest income of $41,150 versus $116,473 a year earlier, for a negative variance of $75,323. The interest income is related to the Corporation investing its excess cash balance in short-term guaranteed interest securities as it executes its exploration program. Management anticipates interest income to decrease over time as it seeks to enhance shareholders' value by investing in exploration and expanding the size of its properties.
For the year ended December 31, 2025, the Corporation expensed $322,453 versus $374,700 a year earlier relating to the reduction in exploration and evaluation. In 2025, the amount related to the return to the government of the Salar de Carcote claims that covered 2,000 ha, as the Corporation would not be able to drill on that property, as well as 467 Claims on the Lidstone property that covered 9,484.46 ha. The expense in 2024 related to specific claims within LSL property that were relinquished due to the continued weakness in the lithium market, particularly for LCT pegmatite discoveries, which necessitated the Corporation's Ontario claims portfolio optimization.
For the year ended December 31, 2025, the Corporation had a reversal of Flow-Through Premium of $27,989 versus $10,600 the year earlier. All qualified expenditures for the FT were incurred during the year in which the funds were raised, and the premiums were reversed in the Consolidated Statements of Operations and Comprehensive Loss in those years as well.
The net loss for the year ended December 31, 2025, was $1,428,692 for a loss per share of $0.01 based on 95,690,039 weighted average common shares outstanding for the year, versus $1,363,007 for a loss per share of $0.01 based on 95,240,411 weighted average common shares outstanding for the previous year.
For the year ended December 31, 2025, cash flows used in operations was $1,084,648 versus $996,223 for a negative variance of $88,425 or 8.9%. The main cause of this variance was due to the operating expenses discussed above, changes in accounts payable and accrued liabilities, and prepaid expenses.
For the year ended December 31, 2025, cash flows provided from financing activities was $177,822 versus $150,731, for a positive variance of $27,091 or 18.0%. The reason for the increase is due to the flow-through financing ("FT"), which was $75,000 in 2025 versus $40,000 the year earlier.
During the year ended December 31, 2025, the Corporation invested an additional $82,333 versus $87,619 the year before to continue to maintain its mineral claims in Chile and Ontario. This amount is in excess of the amount expensed in exploration costs as it relates to the acquisition of claims and the property taxes of such claims.
The Corporation's cash and cash equivalents balance as at December 31, 2025 declined by $989,159 (2024 - $933,111) to $930,630 (2024 - $1,663,953), with a working capital of $518,425 (2024 - $1,919,789). The variances for these amounts have been discussed above.
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First Lithium Minerals Corp.
Management's Discussion and Analysis
ITEM 4 - Summary of Quarterly Results
The following table sets forth, for each quarter ended on the date indicated since incorporation, information relating to the Corporation's revenue, net loss and loss per common share as prepared under IFRS.
| Revenues | Net income (loss) | Loss/share: basic and diluted | |
|---|---|---|---|
| March 31, 2026 | $ — | $ (336,327) | $ 0.00 |
| December 31, 2025 | — | (620,023) | 0.00 |
| September 30, 2025 | — | (332,383) | 0.00 |
| June 30 2025 | — | (216,064) | 0.00 |
| March 31, 2025 | — | (260,222) | 0.00 |
| December 31, 2024 | — | (559,784) | 0.00 |
| September 30, 2024 | — | (330,969) | 0.00 |
| June 30, 2024 | — | (251,186) | 0.00 |
| March 31, 2024 | — | (221,068) | 0.00 |
For the three months ended March 31, 2026, versus March 31, 2025
The Corporation has no revenue-producing assets at this stage, as its mineral properties are all at the exploration and evaluation stage of development. The Corporation is currently enhancing shareholders' value by exploring its mineral assets and expanding its land exploration portfolio.
For the three months ended March, the Corporation had general and administrative expenditures of $2,496 versus $1,688 the year earlier, for a negative variance of $808 or 47.9%. Management anticipates that this line item will average less than $10,000 annually as the Corporation continues to invest in exploration and evaluation while determining the viability of its properties; therefore, it is not anticipated to be a material amount.
For the three months ended March 31, 2026, the Corporation had director fees of $7,500 versus $7,500 the year earlier.
For the three months ended March 31, 2026, the Corporation had management fees of $60,000 versus $60,000 the year earlier.
For the three months ended March 31, 2026, the Corporation had mineral exploration expenditures of $140,590 versus $141,541 the year earlier, for a positive variance of $951 or 0.7%. Mineral expenditures include all costs related to exploration and analysis of the various properties, but exclude the cost of acquiring, staking, land management and property taxes. Management anticipates that this line item will increase and fluctuate significantly as the Corporation invests in exploration and evaluation while determining the viability of its properties. In addition, the Corporation may acquire additional properties should the opportunity arise to enhance shareholder value, as it has done previously.
For the three months ended March 31, 2026, the Corporation had professional expenditures of $49,188 versus $50,910 the year earlier, for a positive variance of $1,099 or 2.2%. Management anticipates this line item to be approximately $200,000 to $250,000 annually unless a transaction outside the normal course of business occurs, which would be incremental.
For the three months ended March 31, 2026, the Corporation had regulatory and shareholders' expenses of $82,188 versus $12,133 the year earlier, for a negative variance of $70,055 or 577.4%. These expenses include all regulatory expenses, such as exchange fees, transfer agent fees, shareholder communications and investor relations. The Corporation increased its investment in communication during this period.
For the three months ended March 31, 2026, the Corporation had operating losses of $342,585 versus $273,772 the year earlier, for a negative variance of $68,813 or 25.1%. The cause of this variance was discussed above.
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First Lithium Minerals Corp.
Management's Discussion and Analysis
For the three months ended March 31, 2026, the Corporation had a foreign exchange gain of $1,538 versus a loss of $487 the year earlier, for a positive variance of $2,025. The foreign exchange is substantially related to the operating activities of the Corporation's Chilean operations.
For the three months ended March 31, 2026, the Corporation had an interest income of $4,720 versus $14,037 the year earlier, for a negative variance of $9,317 or 66.4%. The interest income is related to the Corporation investing its excess cash balance in short-term guaranteed interest securities as it executes its exploration program. Management anticipates interest income to decrease over time as it seeks to enhance shareholders' value by investing in exploration and expanding the size of its properties.
The net loss for the three months ended March 31, 2026, was $336,327 for a loss per share of $0.00 based on 96,380,286 weighted average shares outstanding for the period, versus $260,222 for a loss per share of $0.00 based on 95,442,786 weighted average shares outstanding for the previous period.
For the three months ended March 31, 2026, cash flows used in operations were $275,379 versus $243,922 for a negative variance of $31,457 or 12.9%. The main cause of this variance is related to the operating expenses discussed above and changes in working capital items.
For the three months ended March 31, 2026, cash flows used in financing activities were $68,350 versus $80,955 that was provided a year earlier, for a negative variance of $12,605. The cause of this variance relates to the change in the amount due to directors and officers.
For the three months ended March 31, 2026, cash flows used in investing activities were $6,300 versus $25,000, for a positive variance of $18,700 or 74.8%. The Corporation expenses its exploration costs when incurred, while only capitalizing the cost of acquiring new properties and maintaining its rights to such properties.
The net decrease in cash and cash equivalents during the three months ended March 31, 2026, was $213,329, versus a net decrease of $187,967 the year earlier, for a negative variance of $25,362. The cause of this variance has been discussed above.
ITEM 5 - Liquidity
As at March 31, 2026, the Corporation had a cash balance of $717,301 (December 31, 2025 - $930,630) with a working capital of $175,798 (December 31, 2025 - $518,425).
In October 2024, the Corporation completed a flow-through financing for $40,000, via the issuance of 266,667 common shares at $0.15 per common share. In September 2025, the Corporation completed a flow-through financing for $75,000, via the issuance of 937,500 common shares at $0.08 per common share.
In addition to its cash on hand at the end of the most recent quarter, the Corporation currently has the following options issued and outstanding:
| Quantity | Type | Exercise Price | Expiry Dates |
|---|---|---|---|
| 4,350,000 | Incentive Stock Options | $ 0.08 | December 20, 2028 |
| 30,625 | Broker Warrants | $ 0.08 | March 27, 2027 |
ITEM 6 - Capital Resources
To date, the Corporation has invested in advancing the OCA Project, which includes the completion of a 43-101 that suggested that certain work should be completed on the property to better evaluate its mineralization potential and then drill test the deposit. To finance this work, the Corporation closed the Transaction as discussed in Item 1, which also permitted the Corporation to be listed on the Exchange.
Page 10 of 16
First Lithium Minerals Corp.
Management's Discussion and Analysis
Phase I started in October 2022 at a total cost of approximately $455,000. The work included the following: Transient Electromagnetic and Magneto-Telluric geophysical surveys, shallow brine sampling, logistics and site preparation. This work was completed and delineated drill targets for planned exploration activities in Phase II.
Phase II exploration program and hydrogeologic modelling, which management has estimated to cost U.S. $3. million, is expected to start once the required permits, licences, and agreements have been obtained and finalized. The drilling program is designed for up to five boreholes to depths of up to 500 meters.
Prior to completing Phase II, the Corporation will seek to raise additional funds. The timing and ability of the Corporation to fulfill this objective will depend on the liquidity of the financial markets as well as the willingness of investors to finance such a project. Such future financing may be completed by the issuance of the Corporation's securities.
In addition to the OCA Project, the Corporation has the Lidstone project in Northwestern Ontario, Canada. The Corporation is currently evaluating further prospectivity and exploration potential on the Lidstone claims. In Q4, 2025, the Corporation continued with field work at Lidstone and add value through geologic mapping and prospecting to delineate the greenstone belt. The previously identified gold anomaly will be followed up to investigate a potential gold mineralization in the project area. In parallel, we will refine the greenstone belt extension for the airborne magnetic survey.
ITEM 7 - Off-Balance Sheet Arrangements
As of the date of this MD&A, the Corporation does not have any off-balance sheet arrangements that have, or are reasonably likely to have, a current or future effect on the results of operations or financial condition of the Corporation, including, without limitation, such considerations as liquidity and capital resources that have not previously been discussed.
ITEM 8 - Transactions With Related Parties
Related party transactions include all transactions with directors and officers, as well as entities owned and controlled by directors and officers. All transactions are performed in the normal course of business and are measured at exchange amounts agreed upon by the related parties. The following table summarizes the related party transactions.
| For the three-months ended March 31, | 2026 | 2025 |
|---|---|---|
| Expenses | ||
| Directors Fees | $ 7,500 | $ 7,500 |
| Management Fees | 60,000 | 60,000 |
| Mineral Exploration | 6,616 | 7,515 |
| Professional Fees | 33,000 | 30,000 |
The key management personnel of the Corporation include the Chief Executive Officer, Chief Financial Officer, and the Board of Directors.
Related Parties are principally comprised of amounts outstanding relating to management fees and reimbursement of expenses, and are non-interest-bearing and due on demand.
| As at | March 31, 2026 | December 31, 2025 |
|---|---|---|
| $ 410,610 | $ 342,260 |
During the year ended December 31, 2024, the Corporation completed a flow-through financing for $40,000, of which 166,667 common shares were subscribed by two directors for $25,000. During the year ended December 31, 2025, the Corporation completed a flow-through financing for $75,000, of which 500,000 common shares were subscribed by a director for $40,000.
As at December 31, 2024 and March 31, 2026, no key management personnel were indebted to the Corporation.
Page 11 of 16
First Lithium Minerals Corp.
Management's Discussion and Analysis
ITEM 9 - Proposed Transactions
As of the date of this document, there is no proposed transaction that management of the Corporation believes would require the intervention or approval of the Board of Directors of the Corporation, as well as the shareholders of the Corporation.
ITEM 10 - Risk Factors
Investment in the Corporation must be considered highly speculative due to the nature of the Corporation's business, its formative stage of development, its current financial position and its lack of an earnings record. An investment in any securities of the Corporation should only be considered by those individuals who can afford a total loss of their investment. The following is a summary of the risk factors to be considered:
Exploration and Development
Exploration for minerals is a speculative venture involving substantial risk. There is no certainty that the expenditures made by the Corporation will result in discoveries of commercial mineral reserves. Mining and development risks always accompany anticipated rewards, and uncertainties always exist where mineral properties are concerned. Uncertainties include the size, grade and recovery of naturally occurring mineral deposits. Although exploration and development efforts can outline a mineral deposit with a degree of certainty, the ultimate grade and tonnage are never fully known until mining has been completed. Mineral prices are also a significant factor in the development decision for a mineral property, as a mine may not be economically feasible in a period of depressed prices. Factors beyond the control of the Corporation may affect the marketability of any minerals discovered. Pricing is affected by numerous factors such as international economic and political trends, global or regional consumption and demand patterns, and increased production by current producers.
Title Risks
Title to exploration and evaluation assets involves certain inherent risks due to the difficulties of determining the validity of certain claims, as well as the potential for problems arising from the frequently ambiguous conveyancing history characteristic of many mineral properties. The Corporation has investigated titles to its mineral exploration properties and, to the best of its knowledge, titles to its properties are in good standing.
No Earnings and History of Losses
The business of developing and exploring resource properties involves a high degree of risk and, therefore, there is no assurance that current exploration programs will result in profitable operations. The Corporation has not determined whether any of its properties contain economically recoverable reserves of minerals and currently has not earned any revenue from its mining properties; therefore, the Corporation does not generate cash flow from its operations. There can be no assurance that significant additional losses will not occur in the future. The Corporation's operating expenses and capital expenditures may increase in future years with advancing exploration, development and/or production from the Corporation's properties. The Corporation does not expect to receive revenues from operations in the foreseeable future and expects to incur losses until such time as one or more of its properties enters into commercial production and generates sufficient revenue to fund continuing operations. There is no assurance that any of the properties will eventually enter commercial operation. There is also no assurance that new capital will become available, and if it does not, the Corporation may be forced to substantially curtail or cease operations.
Environmental Regulations, Permits and Licenses
The Corporation's operations are subject to various laws and regulations governing the protection of the environment, exploration, development, production, taxes, labour standards, occupational health and safety, waste disposal, and other matters. Environmental legislation provides for restrictions and prohibitions on spills, releases or emissions of various substances produced in association with certain mining industry operations, such as seepage from tailings disposal areas, which would result in environmental pollution. A breach of such legislation may result in imposition of fines and penalties. In addition, certain types of operations require the submission and approval of environmental impact assessments. Environmental legislation is evolving in a direction of stricter standards, and enforcement, and higher fines and penalties for non-responsibility for companies including its directors, officers and employees. The cost of compliance with changes in governmental regulations has the
Page 12 of 16
First Lithium Minerals Corp.
Management's Discussion and Analysis
potential to reduce the profitability of the Corporation. The Corporation intends to fully comply with all environmental regulations. Failure to comply with applicable laws, regulations, and permitting requirements may result in enforcement actions thereunder, including orders issued by regulatory or judicial authorities causing operations to cease or be curtailed, and may include corrective measures requiring capital expenditures, installation of additional equipment, or remedial actions. Parties engaged in mining operations may be required to compensate those suffering loss or damage by reason of mining activities and may have civil or criminal fines or penalties imposed for violations of applicable laws or regulations and, in particular, environmental laws. Amendments to current laws, regulations and permits governing operations and activities of mining companies, or more stringent implementation thereof, could have a material adverse impact on the Corporation and cause increases in capital expenditures or production costs or reduction in levels of production at producing properties, or requirements abandonment, or delays in the development of new mining properties.
Chilean Government Controls over Lithium
In 2023, the Chilean government created two entities to oversee the government's plan to increase state control over the lithium industry. The specifics are unknown as to how the government plans to execute this new policy. Therefore, it is not certain that should the Corporation be successful in identifying economically feasible reserves, that it would be able to obtain all necessary licenses and permits to extract such reserves until such time as a potential partnership with one of these entities has been entered into.
Lithium Market Prices
Lithium is not a traded commodity like base and precious metals. Sales agreements are negotiated on an individual and private basis with end-users or intermediaries. In addition, there are a limited number of producers of lithium compounds, and it is possible that these existing producers will try to prevent newcomers from entering the chain of supply by increasing their production capacity and lowering sales prices. Other factors, such as supply and demand of lithium-based end-products (such as lithium carbonate and lithium hydroxide), pricing characteristics of alternative sources of energy, industrial disruption and actual lithium market sale prices, could have an adverse impact on the market price of lithium and as such render the Corporation properties uneconomic. There can be no assurance that such prices will remain at current levels or that such prices will improve.
Lithium Market Growth Uncertainty
Factors beyond the Corporation's control may affect the marketability of metals discovered, if any. The development of lithium operations at the Corporation properties is highly dependent on projected demand for and uses of lithium-based end products. This includes lithium-ion batteries for electric vehicles and other large format batteries that currently have limited market share and whose projected adoption rates are not assured. To the extent that such markets do not develop in the manner contemplated by the Corporation, then the long-term growth in the market for lithium products will be adversely affected, which would inhibit the potential for development of the projects, their potential commercial viability and would otherwise have a negative effect on the business and financial condition of the Corporation. In addition, as a commodity, lithium market demand is subject to the substitution effect in which end-users adopt an alternate commodity as a response to supply constraints or increases in market pricing. To the extent that these factors arise in the market for lithium, it could have a negative impact on overall prospects for growth of the lithium market and pricing, which in turn could have a negative effect on the Corporation and its projects.
Risks Relating to Changes in Technology
Lithium and its derivatives are preferred raw materials for certain industrial applications, such as rechargeable batteries and liquid crystal displays (LCDs). Many materials and technologies are being researched and developed with the goal of making batteries lighter, more efficient, faster charging and less expensive. Some of these technologies could be successful and could adversely affect demand for lithium batteries in personal electronics, electric and hybrid vehicles and other applications. The Corporation cannot predict which new technologies may ultimately prove to be commercially viable and on what time horizon. In addition, alternatives to such products may become more economically attractive as global commodity prices shift. Any of these events could adversely affect demand for and market prices of lithium, thereby resulting in a material adverse effect on the economic feasibility of extracting any mineralization the Corporation discovers and reducing or eliminating any reserves it identifies.
Credit risk
Credit risk is the risk of loss due to the counterparty's inability to meet its obligations. The Corporation's exposure to credit risk is on its cash. Risk associated with cash is managed through the use of major banks which are high credit quality financial institutions as determined by rating agencies.
Page 13 of 16
First Lithium Minerals Corp.
Management's Discussion and Analysis
Liquidity risk
Liquidity risk is the risk that the Corporation will encounter difficulties in meeting obligations when they become due. The Corporation endeavors to ensure that there is sufficient capital in order to meet short-term operating requirements, after taking into account the Corporation's holdings of cash. The Corporation's cash is held in corporate bank accounts available on demand. The Corporation's accounts payable and accrued expenses generally have contractual maturities of less than 30 days and are subject to normal trade terms.
Market Risk
Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: currency risk, interest rate risk and price risk.
Currency Risk
The Corporation is subject to normal market risks including fluctuations in foreign exchange rates and interest rates. While the Corporation manages its operations in order to minimize exposure to these risks, the Corporation has not entered into any derivatives or contracts to hedge or otherwise mitigate this exposure. The Corporation is not exposed to significant currency risk.
Interest Rate Risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Corporation is not exposed to significant interest rate risk as it has no interest-bearing debt.
Price Risk
The Corporation is exposed to price risk with respect to equity prices. Price risk as it relates to the Corporation is defined as the potential adverse impact on the Corporation's ability to raise financing due to movements in individual equity prices or general movements in the level of the stock market. The Corporation closely monitors individual equity movements and the stock market to determine the appropriate course of action to be taken by the Corporation.
No Known Economic Deposits
The Corporation is an exploration stage company and cannot give assurance that a commercially viable deposit, or "reserve," exists on any properties for which the Corporation currently has or may have (through potential future joint venture agreements or acquisitions) an interest. Therefore, determination of the existence of a reserve depends on appropriate and sufficient exploration work and the evaluation of legal, economic, and environmental factors. If the Corporation fails to find a commercially viable deposit on any of its properties, its financial condition and results of operations will be materially adversely affected.
Operating Hazards and Risks
Mining operations involve many risks, which even a combination of experience, knowledge and careful evaluation may not be able to overcome. In the course of exploration, development and production of mineral properties, certain risks, and in particular, unexpected or unusual geological operating conditions including rock bursts, cave-ins, fires, flooding and earthquakes may occur. Operations in which the Corporation has a direct or indirect interest will be subject to all the hazards and risks normally incidental to exploration, development and production of metals, any of which could result in damage to or destruction of mines and other producing facilities, damage to life and property, environmental damage and possible legal liability for any or all damage.
Influence of Third-Party Stakeholders
The OCA Project, as well as other mineral properties of the Corporation, or the roads or other means of access which the Corporation intends to utilize in carrying out its work programs or general business mandates on the OCA Project or its other properties may be subject to interests or claims by third party individuals, groups or companies. In the event that such third parties assert any claims, the Corporation's work programs may be delayed even if such claims are not meritorious. Such delays may result in significant financial loss and loss of opportunity for the Corporation.
Uninsurable Risks
Exploration, development and production of mineral properties is subject to certain risks, and in particular, unexpected or unusual geological operating conditions including rock bursts, cave- ins, fires, flooding and
Page 14 of 16
First Lithium Minerals Corp.
Management's Discussion and Analysis
earthquakes may occur. It is not always possible to insure fully against such risks and we may decide not to take out insurance against such risks as a result of high premiums or for other reasons. Should such liabilities arise, they could have an adverse impact on our operations and could reduce or eliminate any future profitability and result in increasing costs and a decline in the value of the securities of the Corporation.
Competition and Agreements with Other Parties
The mining industry is intensely competitive in all its phases. The Corporation competes with other companies that have greater financial resources and technical capacity. Competition could adversely affect the Corporation's ability to acquire suitable properties or prospects in the future. The Corporation may, in the future, be unable to meet its share of costs incurred under agreements to which it is a party, and it may have its interest in the properties subject to such agreements reduced as a result. Also, if other parties to such agreements do not meet their share of such costs, the Corporation may not be able to finance the expenditures required to complete recommended programs.
Dependence on Management
The Corporation is very dependent upon the personal efforts and commitment of its existing management. To the extent that management's services would be unavailable for any reason, a disruption to the operations of the Corporation could result, and other persons would be required to manage and operate the Corporation.
Price Volatility of Public Stock
In recent years, securities markets have experienced extremes in price and volume volatility. The market price of securities of many early stage companies, among others, have experienced fluctuations in price which may not necessarily be related to the operating performance, underlying asset values or prospects of such companies. It may be anticipated that any market for the Corporation Shares will be subject to market trends generally and the value of the Corporation's shares on a stock exchange may be affected by such volatility. The Corporation has an unlimited number of common shares that may be issued by the board of directors without further action or approval of the Corporation Shareholders. While the board is required to fulfil its fiduciary obligations in connection with the issuance of such shares, the shares may be issued in transactions with which not all shareholders agree, and the issuance of such shares will cause dilution to the ownership interests of the Corporation Shareholders.
Dividends
The Corporation has not declared or paid any dividends on its common shares and does not currently have a policy on the payment of dividends. For the foreseeable future, the Corporation anticipates that it will retain future earnings and other cash resources for the operation and developments of its business. The payment of any future dividends will depend upon earnings and the Corporation's financial condition, current and anticipated cash needs and such other factors as the directors of the Corporation consider appropriate.
Estimates and Assumptions
Preparation of its financial statements requires the Corporation to use estimates and assumptions. Accounting for estimates requires the Corporation to use its judgment to determine the amount to be recorded on its financial statements in connection with these estimates. If the estimates and assumptions are inaccurate, the Corporation could be required to write down its recorded values. On an ongoing basis, the Corporation re-evaluates its estimates and assumptions. However, the actual amounts could differ from those based on estimates and assumptions.
Conflicts of Interest
The Corporation's directors and officers may serve as directors and officers or may be associated with other reporting companies or have significant shareholdings in other public companies. To the extent that such other companies may participate in business or asset acquisitions, dispositions, or ventures in which the Corporation may participate, the directors and officers of the Corporation may have a conflict of interest in negotiating and concluding terms respecting the transaction. If a conflict of interest arises, the Corporation will follow the provisions of the OBCA in dealing with conflicts of interest. These provisions state, where a director/officer has such a conflict, that the director/officer must at a meeting of the board, disclose his interest and refrain from voting on the matter unless otherwise permitted by the OBCA. In accordance with the laws of the Province of Ontario the directors and officers of the Corporation are required to act honestly, in good faith and in the best interests of the Corporation.
Costs and Compliance Risks
Legal, accounting and other expenses associated with public company reporting requirements are significant. The Corporation anticipates that costs may increase with corporate governance related requirements, including, without limitation, requirements under National Instrument 52-109 – Certification of Disclosure in Issuers' Annual and
Page 15 of 16
First Lithium Minerals Corp.
Management's Discussion and Analysis
Interim Filings, National Instrument 52-110 – Audit Committees and National Instrument 58-101 – Disclosure of Corporate Governance Practices. The Corporation also expects these rules and regulations may make it more difficult and more expensive for it to obtain director and officer liability insurance, and it may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. As a result, it may be more difficult for the Corporation to attract and retain qualified individuals to serve on its board of directors or as executive officers.
ITEM 11 - Critical Accounting Estimates
The Corporation's financial statements are impacted by the accounting policies used, as well as the estimates and assumptions made by management during their preparation. The Corporation's accounting policies are described within the financial statements that are incorporated by reference, that describes the accounting estimates considered to be significant to the Corporation.
ITEM 12 - Changes in Accounting Policies
The Corporation would like to direct readers to its audited financial statements for the year ending December 31, 2025, and unaudited condensed interim consolidated financial statements for the period ending March 31, 2026, which is incorporated by reference and can be found on the regulator's website at www.sedar.com, which is incorporated by reference.
ITEM 13 - Financial Instruments and Other Instruments
The Corporation would like to direct readers to its audited financial statements for the year ending December 31, 2025, and unaudited condensed interim consolidated financial statements for the period ending March 31, 2026, which are incorporated by reference and can be found on the regulator's web site at www.sedar.com, which is incorporated by reference.
ITEM 14 - Capital Structure
The Corporation is authorized to issue an unlimited number of common shares, where each common share provides the holder with one vote. As of the date of this MD&A, there were 96,380,286 common shares issued and outstanding, as well as the following derivatives:
| Quantity | Type | Exercise Price | Expiry Dates |
|---|---|---|---|
| 4,350,000 | Incentive Stock Options | $ 0.08 | December 20, 2028 |
| 30,625 | Broker Warrants | 0.08 | March 26, 2027 |