FRONTIER LITHIUM INC.

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MANAGEMENT DISCUSSION AND ANALYSIS

FOR THE NINE MONTHS ENDED

DECEMBER 31, 2020

This Management Discussion & Analysis (“MD&A”), for Frontier Lithium ("Frontier" or the “Company”), is prepared with an effective date of December 31, 2020 unless otherwise indicated and should be viewed in conjunction with the Company’s financial statements. Other continuous disclosure documents, including the Company’s press releases and other quarterly and annual reports are available through its filings with the securities regulatory authorities in Canada at www.sedar.com (“SEDAR”) and are also available on the Company’s website www.frontierlithium.com .

TABLE OF CONTENTS TABLE OF CONTENTS __________ 1 INTRODUCTION ____________ 4 FORWARD LOOKING STATEMENTS _________ 4 I. REPORTING ENTITY, NATURE OF OPERATIONS, SCOPE OF ACTIVITIES AND GOING CONCERN _ 5 II. BUSINESS ACTIVITIES AND OBJECTIVES, PLANNED WORK AND FUTURE MILESTONES ___ 5 CORPORATION AND LOCATION _________ 6 CORPORATION OVERVIEW __________ 6 III. HIGHLIGHTS FOR THE NINE MONTHS ENDED DECEMBER 31, 2020 AND UP TO THE DATE OF THIS REPORT AND NEXT STEPS ____________ 8 EXPLORATION AND DEVELOPMENT HIGHLIGHTS: _______ 8 _Exploration _____________________________________________________________________________ 8 Development __________________________________________________________________________10 IV. MINING PROPERTY, 2020 PRE-FEASIBILITY STUDY (PFS) UPDATE, MINERAL RESOURCES AND MINERAL RESERVES __________14 V. SELECTED FINANCIAL INFORMATION ___________18 CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT DECEMBER 31, 2020 ____19 FINANCING ACTIVITIES FOR THE NINE-MONTH PERIOD ENDED DECEMBER 31, 2020 ___21 INVESTING ACTIVITIES FOR THE NINE-MONTH PERIOD ENDED DECEMBER 31, 2020 ________________________21 VI. SELECTED QUARTERLY DATA ___________22 ACTIVITIES IN THE COMMON SHARES, SHARE PURCHASE OPTIONS, WARRANTS ISSUED TO SHAREHOLDERS AND COMPENSATION OPTIONS TO BROKERS: __________22 _Common shares and financing sources: ________22 Options: ___________23 Warrants issued to shareholders: _________23 VII. OUTLOOK: ____________23 VIII. BASIS OF PREPARATION: ____________26 STATEMENT OF COMPLIANCE: _________27 BASIS OF MEASUREMENT: _________27 FUNCTIONAL AND PRESENTATION CURRENCY: _______27 USE OF ESTIMATES AND JUDGMENTS: ___________27 IX. SIGNIFICANT ACCOUNTING POLICIES: __________27

X. FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT: _____28 OFF BALANCE SHEET AGREEMENTS _________28 RELATED PARTY TRANSACTIONS _________28 OBLIGATIONS AND CONTRACTUAL COMMITMENTS _______28 RISK EXPOSURE AND MANAGEMENT _________29 _MARKET, INTEREST AND CURRENCY RISK: ______29 CREDIT RISK: __________30 LIQUIDITY RISK AND CASH RESTRICTIONS: ______30 LITHIUM PRICE RISK: __________30 CAPITAL MANAGEMENT:__________32 PROPERTY TITLES __________32 XI. RISK FACTORS RELATED TO THE CORPORATION ______32 CONDITIONS OF THE INDUSTRY IN GENERAL ________32 GOVERNMENTAL REGULATION __________33 RISKS OF LAWSUITS AND NON-INSURABLE RISKS ________33 CONFLICTS OF INTEREST __________33 PERMITS, LICENCES AND AUTHORIZATIONS ________33 DEPENDENCE ON THE MANAGEMENT _______34 PRICE OF LITHIUM SALTS AND SPODUMENE CONCENTRATE ____34 GOING CONCERN AND INSOLVENCY RISK _______34 THE CORPORATION’S DEPENDENCE UPON THE ADVANCED EXPLORATION PROJECT (PHASE I DEMONSTRATION CONCENTRATOR) ________34 INFRASTRUCTURE, SUPPLIES, INFLATION AND OPERATION COSTS ____35 NO CURRENT PLANS TO PAY CASH DIVIDENDS _______35 DILUTION ____________35 XII. DISCLOSURE CONTROLS AND PROCEDURES AND INTERNAL CONTROLS OVER FINANCIAL REPORTING ____________35 DISCLOSURE CONTROLS AND PROCEDURES (DC&P) ________36 INTERNAL CONTROL OVER FINANCIAL REPORTING (ICFR) ______36 ADDITIONAL DISCLOSURE FOR VENTURE ISSUERS WITHOUT SIGNIFICANT REVENUE _________36

FIGURES Figure 1: Project Location ........................................................................................................................................... 6 Figure 2: PAK deposit at surface ................................................................................................................................ 7 Figure 3: Location Map showing project area and location of drill holes and channels on the Spark Pegmatite ...... 9 Figure 4: 3D Rendering of the Spark Pegmatite showing drill holes, channels and Block Model used in the Resource Calculation ................................................................................................................................................10 Figure 5: Frontier Technical Grade Spodumene sample containing 7.2% lithium oxide and .13% iron oxide ........12 Figure 6: Sample of Lithium Hydroxide Monohydrate salt containing 35.6% lithium oxide ......................................13 Figure 7: PFS Mine Design.......................................................................................................................................15 Figure 8: Chemical Supply and Demand forecast with LiOH growth (Source: RK Equity) ......................................24 Figure 9: N.American Lithium Resource comparison by grade ................................................................................24 Figure 10: Lithium Market Balance ...........................................................................................................................25 Figure 11: Chemical Grade Spodumene FOB Australia ..........................................................................................31 TABLES Table 1: Dense Media Separation + Locked Cycle Flotation test results (FRON-19) ..............................................11 Table 2: Pre-Feasibility 2020 highlights ....................................................................................................................15 Table 3: Resource Table ..........................................................................................................................................16 Table 4: Reserve Table ............................................................................................................................................17 Table 5: Summary of Mineral Resource Estimate for the Spark Pegmatite .............................................................18 Table 6: Statement of Operations, Comprehensive Loss and Deficit ......................................................................20

INTRODUCTION

The following management discussion and analysis (the “MD&A”) objective is to help the reader better understand the activities of Frontier Lithium Inc. (the “Corporation”) and the highlights of its financial condition. It explains the financial situation and the results for the nine-month period ended December 31, 2020 and 2019 and the comparison of the Corporation’s consolidated condensed interim statement of financial position as at March 31, 2020 and March 31, 2019.

The MD&A has been prepared in accordance with Regulation 51-102 and should be read in conjunction with the audited consolidated financial statements for the twelve-month period ended March 31, 2020 and the audited consolidated financial statements of the Corporation for the fiscal year ended March 31, 2019 and the related notes thereto which are available on the SEDAR website at www.sedar.com. All financial information contained in this MD&A and the Corporation’s audited consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”), also referred to as Generally Accepted Accounting Principles (“GAAP”), as issued by the International Accounting Standards Board (“IASB”).

The audited consolidated financial statements have been prepared on a going concern basis, which assumes that the Corporation will be able to realize its assets and discharge its liabilities in the normal course of business as they come due into the foreseeable future.

The audited consolidated financial statements and this MD&A have been reviewed by the Audit Committee and approved by the Corporation’s Board of Directors on February 19, 2021. Unless otherwise indicated, all the amounts in this MD&A are in Canadian dollars unless otherwise indicated.

FORWARD LOOKING STATEMENTS

All statements, other than statements of historical fact, contained in this MD&A including, but not limited to, any information as to the future plans and outlook for the Corporation, constitute ''forward-looking information'' or ''forward-looking statements'' within the meaning of certain securities laws, and are based on expectations, estimates and projections as of the time of this MD&A. The words "anticipates", ''plans'', ''expects'', "indicate", "intend", ''scheduled'', ''estimates'', ''forecasts", "guidance", "initiative", "outlook", "potential", "projected", "pursue", "strategy", "study", "targets", or ''believes'', or variations of or similar such words and phrases or statements that certain actions, events or results ''may'', ''could'', ''would'', or ''should'', ''might'', or "way forward", ''will be taken'', ''will occur'' or ''will be achieved'' and similar expressions identify forward-looking statements. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by the Corporation, acting in good faith, as of the time of such statements, are inherently subject to significant business, economic and competitive uncertainties and contingencies. These estimates and assumptions may prove to be incorrect. Many of these uncertainties and contingencies can directly or indirectly

affect, and could cause, actual results to differ materially from those expressed or implied in any forward-looking statements. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Forward-looking statements are provided for the purpose of providing information about management's expectations and plans relating to the future. Readers are cautioned not to place undue reliance on these forward-looking statements as a number of important risk factors and future events could cause the actual outcomes to differ materially from the beliefs, plans, objectives, expectations, anticipations, estimates, assumptions and intentions expressed in such forward-looking statements. The Corporation disclaims any intention or obligation to update or revise any forwardlooking statements or to explain any material difference between subsequent actual events and such forwardlooking statements, except to the extent required by applicable law.

I. REPORTING ENTITY, NATURE OF OPERATIONS, SCOPE OF ACTIVITIES AND GOING CONCERN

Frontier Lithium (“Corporation” or “the Corporation”) is a Canadian junior mining Corporation actively focused on the acquisition, exploration and development of mineral resource properties in North America. The Corporation is domiciled in Canada and incorporated under the Canada Business Corporations Act. The Corporations’ registered office is located at 2736 Belisle Drive, Greater Sudbury, Ontario (P3N 1B3). The Corporation is listed on the following exchanges:

Jurisdiction	Exchange	Symbol
Canada	Toronto Stock Exchange Venture (TSX.V)	FL
United States	Over-the Counter (“OTCQB”) – Grey Market	LITOF
Germany	Borse Frankfurt	HL2

All material assets of the Corporation are located in the province of Ontario. The Corporation’s main assets include (not limited to), a mining lease, mining claims, exploration camp infrastructures and related equipment, vehicles, computer software and hardware.

II. BUSINESS ACTIVITIES AND OBJECTIVES, PLANNED WORK AND FUTURE MILESTONES

CORPORATION AND LOCATION

The Corporation is a pure-play lithium mineral exploration and development company focused on its 100%-owned PAK Lithium Project in northwestern Ontario, Canada. The Corporation maintains the largest land position on the Electric Avenue, an emerging premium lithium-mineral district which is hosted in the Canadian Shield of northwestern Ontario. The Electric Avenue is a major structural corridor in northwestern Ontario that divides two geological domains for hundreds of kilometers and hosts multiple rare metal occurrences containing high levels of lithium in the mineral called spodumene. Chief among these known occurrences is the PAK and Spark pegmatite deposits, located at the southeastern end of the Electric Avenue on the Corporation’s PAK Lithium Project (Figure 1).

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Figure 1: Project Location

CORPORATION OVERVIEW

Frontier Lithium’s objective is to become a strategic domestic supplier of spodumene concentrates for industrial users as well as battery-grade lithium hydroxide and other chemicals to the growing electric vehicle and energy

storage markets in North America. Frontier is a Sudbury based company which maintains the largest land position and resource in a new premium lithium mineral district located in Ontario’s Great Lakes region. The region is advantaged by favourable geology, proven metallurgy with access to intermodal hubs, infrastructure, power, and mining along with downstream lithium processing expertise for auto OEM's future Li-Ion battery requirements. Frontier aims to complete final permitting, metallurgical test work and definitive feasibility by 2023 to construct and mine, mill and downstream chemical plant to produce lithium chemicals by 2025.

Frontier’s leadership team’s successful mining ventures include a multi-decade track record in funding, partnering, constructing and operating mining and refining companies in North America. The company is currently preparing a Preliminary Economic Assessment (“PEA”) to produce concentrates and build a downstream processing facility to produce lithium chemicals required by glass and battery materials producers. The company is in the permitting stage for an Advanced Exploration sample from the project, is currently planning in-fill drilling on the Spark deposit and is currently constructing a pilot-plant to produce lithium chemicals.

The Corporation has been actively involved since February 2013 in the exploration and development of the PAK Lithium Project, which hosts at surface the highest quality spodumene lithium hard rock deposit in North America (Figure 2). High-quality is defined by low impurity levels (e.g., iron levels less than .15% Fe2O3), high grade and volume determining an economically viable resource.

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Figure 2: PAK deposit at surface

The PAK mining property has economically recoverable ore reserves, pursuant to a NI-43-101 technical report (Pre-Feasibility Study) regarding the PAK Lithium Mine with an effective date of March 2, 2018 and filed on SEDAR on April 16, 2018 (the "2018 Pre-Feasibility Study") and updated on March 23, 2020. Exploration and

development is progressing based on the funds available to the Corporation. As at March 31, 2020, $12.5 million of capital expenditures have been incurred on the PAK Lithium Project.

The preparation of the consolidated financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in future periods affected.

III. HIGHLIGHTS FOR THE NINE MONTHS ENDED DECEMBER 31, 2020 AND UP TO THE DATE OF THIS REPORT AND NEXT STEPS

EXPLORATION AND DEVELOPMENT HIGHLIGHTS:

During the fiscal year ended March 31, 2020 and up to the date of this report, exploration continued at the PAK Lithium Project. As at December 31, 2020, a total of $13.4 million in acquisition and exploration expenditures have been incurred on the project.

The Corporation has had a successful year by advancing exploration and development work. In Fiscal 2020 the company completed two phases of diamond drilling and produced a maiden resource estimate on the recently discovered Spark deposit. The company formed a strategic partnership to develop lithium hydroxide chemical technology to diversify the Corporation from a pure exploration focus with the addition of development work to transition the project towards production of premium concentrates taking initial steps towards refining lithium concentrate feedstock to produce higher purity lithium hydroxide chemicals in a laboratory setting.

EXPLORATION

A New Discovery “the Spark”

On November 7, 2018, the Corporation announced the discovery of the Spark pegmatite intruding vertically into metavolcanics and metasedimentary host rocks. The pegmatite is located 2.3 km north-west of the PAK deposit. As a result of the Spark discovery, the Corporation increased their land position on the Electric Avenue by staking an additional 891 claim cells totalling 17,766 ha over a 65 km strike length.

Channel sampling was initiated at the time of discovery in September 2018 and completed a month later in October. The pegmatite is well exposed where minimal stripping by hand was required to complete the channel sampling. In total 236.4m of channels were cut representing two main transects. Results proved consistent lithium

grades and homogeneity across the width of the exposed pegmatite as highlighted by one transect of 94.5m averaging 1.85% Li2O.

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Figure 3: Location Map showing project area and location of drill holes and channels on the Spark Pegmatite

The Corporation followed up in February 2019 with a 1,340 metre, 5-hole diamond drill program. Four of the holes were drilled from the south with one hole drilled from the north. All holes intersected significant widths of 20 to 74m of pegmatite averaging 1.2 to 1.92% Li2O. All indications suggest that the Spark pegmatite intruded vertically, cross cutting in an east-west direction, the main trend of the Bearhead fault zone and appears characteristically similar to the LIZ (Lower Intermediate Zone) of the PAK pegmatite.

A second phase of drilling consisting of 4 drill holes, three of which were drilled from the north, totalling 1,160m and an additional 52m of channeling was completed in July 2019. The initial hole intersected a total of 231m of pegmatite averaging 1.6% Li2O. All indications suggest the Spark Pegmatite is vertically emplaced; open to the west with a multiple dyke-system extending to the east. The summer drilling completed the transects required for the resource estimate announced by WSP (February 4, 2020). The resource

estimate for Spark of 3.2 MT Indicated and 12.23 MT Inferred averaging 1.59% and 1.36% Li2O respectively, has more than doubled the overall lithium resource for the project.

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Figure 4: 3D Rendering of the Spark Pegmatite showing drill holes, channels and Block Model used in the Resource Calculation

The Corporation is currently performing a geostatistical analysis and metallurgical testing on representative samples from the Spark discovery. The primary objective from management is to assess material from the deposit and its metallurgical properties so that representative concentrates can be produced. This type of information is key to building a sustainable plan for a potential future Commercial scale mining operation on the Project.

Management believes that the Spark discovery combined with the PAK deposit is now considered “World-Class” and the size of resource would allow for Frontier’s objective of being a future fully integrated mining and chemical company producing 25,000 tonnes LCE for an estimated 15 or more years.

DEVELOPMENT

Piloting of concentrate and bench-scale lithium chemicals production.

In May 2020, the Corporation announced a positive metallurgical result from a PAK deposit composite sample of ore. The test work was carried out on a 400 kg sample targeting a mineralogically representative “life of mine” master composite sample. The sample was assembled with the objective of finalizing flowsheet design and to also confirm with a global user of concentrates the suitability of the material to meet to the most rigorous specifications of the global lithium market. Dense Media Separation (“DMS”) and Flotation Locked-Cycle (“LCT”)

testing produced a high quality spodumene concentrate product with an average grade of 7.2% lithium oxide (“Li2O”), iron oxide below 0.15% Fe2O3, and low impurities from the composite sample. The concentrate

produced compares favorably with the premium concentrate specification guarantees (see Table 1) from the world’s rare primary source of technical grade spodumene concentrates, produced from select zones of the Greenbushes deposit in southwestern Australia.

Table 1: Dense Media Separation + Locked Cycle Flotation test results (FRON-19)

Chemical Compound	Frontier Lithium composite sample average	Albemarle(i) SC 7.2 Premium	Albemarle(i) SC 7.2 Standard
Li2O	7.2 %	min. 7.2 %	max. 7.2 %
Al2O3	24.4 %	min. 25.0 %	min. 25.0 %
SiO2	64.8 %	min. 62.5 %	max. 62.5 %
Fe2O3	0.135 %	max. 0.12 %	max. 0.17 %
Na2O	0.16 %	max. 0.35 %	max. 0.35 %
K2O	0.11 %	max. 0.30 %	min. 0.40 %
P2O5	0.05 %	max. 0.25 %	min. 0.35 %
CaO	0.03 %	max. 0.10 %	min. 0.10 %

Based on the successful pilot results Frontier is assessing a possible demonstration stage for concentrate production of multiple lithium feedstock products for both industrial and battery markets (Figure 5).

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Figure 5: Frontier Technical Grade Spodumene sample containing 7.2% lithium oxide and .13% iron oxide

Construction of a demonstration scale plant could commence (if a decision to build is made) in the next 12-20 months providing related advanced exploration permits financing are confirmed.

The key goals of the concentrate demonstration production are to:

Commence by March 2022.
Produce high-quality technical grade sample concentrates (7.2% Li2O) for the expanding glass and ceramics markets;
Produce high-quality chemical grade concentrates (6% Li2O) for the rapidly developing lithium battery market;
Qualify products that meet specific customer and application requirements to secure North American and European off-take agreements;
Validate and optimize the mining and milling technology and flow-sheet design in advance of finalizing a Commercial Production feasibility study;

The spodumene concentrates will firstly be produced from the PAK Deposit. This demonstration, once in operation, will process spodumene ore to produce high quality concentrates using simple open pit mining and conventional processing operations.

The PAK deposit is located on the other side of the globe from the world-class operating Greenbushes’ deposit in Western Australia which has dominated global hard rock supply for years (approximately 30% of the worlds demand for lithium). The demonstration plant will enable the Corporation to reach out to potential customers and offer a high quality, reliable, long term and cost effective North American alternative. The demonstration will also produce concentrates feedstock required for downstream chemical processing at the pilot and demonstration scale.

Strategic Partnership to Pilot Technology to “refine feedstock to produce lithium chemicals”.

The Corporation has identified specific technology and markets of interest for lithium compounds produced from the transformation of spodumene concentrate and has identified that high-quality feedstock and subsequent lithium salts will demand a premium. Frontier’s PAK lithium project is located in the Great Lakes region, a location identified by the Corporation to become a critical North American supply chain hub for electric vehicle production and sales.

On April 24[th] , 2019, the Corporation entered into a strategic partnership agreement with XPS Expert Process Solutions (“XPS”) a Glencore Corporation to develop a process to refine spodumene concentrate into lithium hydroxide (see Figure 6).

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Figure 6: Sample of Lithium Hydroxide Monohydrate salt containing 35.6% lithium oxide

The partnership reflects Frontier’s commitment to lay the foundation for a regional, vertically integrated Battery Ecosystem energizing Ontario’s drive to prosperity. The joint project will be conducted in Canada and has commenced with a bench-scale study that includes single stage dense media separation (DMS), flotation, pyrometallurgy and hydrometallurgy. Phase I is evaluating the potential purity and recovery of lithium from representative concentrates generated firstly by the PAK Deposit to ultimately improve commercial understanding and provide data for generation of a pilot process. The test work is expected to conclude by the end of the second quarter of calendar 2021.

Leveraging expertise through partnerships echoes Frontier’s approach to foster research and sustainable innovation. The Corporation believes that this alliance will spearhead the production of high-quality battery grade lithium products in Northern Ontario and help establish this region as a significant Canadian contributor to clean energy technology. With close proximal location, Frontier is targeting the vehicle manufacturing potential of Ontario and Michigan as the greatest potential use of lithium compounds possibly produced in the future by the Corporation.

IV. MINING PROPERTY, 2020 PRE-FEASIBILITY STUDY (PFS) UPDATE, MINERAL RESOURCES AND MINERAL RESERVES

At the date of this report, the Corporation owns 100% of the PAK Lithium mining property consisting of one mining lease and 1,378 contiguous mining claim units totalling 26,774 hectares, whereby the PAK deposit is contained (Figure 1).

There has been no previous mining or other development activities on the project. The only activities have been early exploration including line cutting ground geophysics, geological mapping, outcrop sampling, diamond drilling, and a 280-tonne bulk sample from the PAK deposit’s high-grade zone (UIZ) at surface in 2015. The Project area is underexplored and is currently in it’s ninth (9[th] ) phase of diamond drilling and is serviced by a temporary 20-person camp.

On March 23, 2020, the Corporation filed an updated NI 43-101 Technical Report entitled the PAK Preliminary Feasibility Study and Spark Resource Estimation, Red Lake Mining District, Ontario, Canada by WSP Canada Inc. and Nordmin Engineering Ltd. Of note, the PFS was performed on the PAK deposit and not inclusive of the Spark deposit with the controlling factor being infrastructure limitations of the 150km of winter road only access and diesel power generation to assess the viability

of a mining and milling operation to produce high quality spodumene concentrates (mostly premium technical grade concentrates).

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Figure 7: PFS Mine Design

The table below highlights selected information taken from the Pre-Feasibility Study filed on SEDAR on March 23,2020 and should be referenced for details when reviewing the below information:

Table 2: Pre-Feasibility 2020 highlights

Production Profile
Total Tonnes Milled	5.8 million
Diluted Head Grade	2.00% Li2O
Mine Life	16 years
Daily mill commercial throughput	1,090 tpd
Lithium Recovery	78.5%
Total TG Production (7.2% Li2O)	1.14 MT
Total CG Production (6.6% Li2O)	115,500 tonnes

Economic Assumptions and Parameters
Exchange Rate(USD/CAD)	$1.25
Discount Rate	8%
TG_SC7.2 Price(USD)	$1,250/tonne
CG_SC6.6 Price(USD)	$750/tonne

Project Economics

Pre-Tax
NPV(8% Discount Rate)	$448 M
Internal Rate of Return	46.5%
Cumulative Cash Flow	$1,013 M
Post-Tax
NPV(8% Discount Rate)	$301 M
Internal Rate of Return	38.3%
Cumulative Cash Flow	$700 M

Capital Requirements	$ Millions
Site Prep/ Infrastructure	45.6
Mill Processing	59.3
Power Distribution	6.4
Open Pit Equipment	12.9
Water treatment and waste management	9.5
Contingency	13.5
Total Pre-production Capital Cost	147.3
Total Sustaining Capital Cost	36.6

Operating Costs	$ Millions
Direct Open PitMining Cost	4.06
Direct UndergroundMining Cost	84.07
DirectProcessing Cost	18.01

Table 3: Resource Table[1]

Cut-	Resource			Li2O	Contained
		Geologic Zone	Tonnes (t)			LCE (t)
off	Category			(%)	Li2O (t)

0.4% Li2O eq.	Measured	Upper Intermediate Zone (UIZ)	324,720	3.95	12,830	31,690
		Lower Intermediate Zone (LIZ)	920,330	1.72	15,848	39,145
		Total Lithium Zone	1,245,050	2.30	28,678	70,835
	Indicated	Upper Intermediate Zone (UIZ)	333,200	3.23	10,776	26,617
		Lower Intermediate Zone (LIZ)	5,909,500	1.89	111,690	275,874
		Total Lithium Zone	6,242,700	1.96	122,465	302,489
	Measured + Indicated	Upper Intermediate Zone (UIZ)	657,920	3.59	23,605	58,304
		Lower Intermediate Zone (LIZ)	6,829,830	1.87	127,538	315,019
		Total Lithium Zone	7,487,750	2.02	151,143	373,323
	In fe rr e	d Upper Intermediate Zone (UIZ)	13,000	3.56	463	1,144

1 Mineral resources which are not mineral reserves do not have demonstrated economic viability. Inferred mineral resources are exclusive of the Measured and Indicated resources.

		Lower Intermediate Zone (LIZ)	1,819,000	2.09	37,982	93,816
		Total Lithium Zone	1,832,000	2.10	38,439	94,944
	Grand Total	Total Lithium Zone in Bulk Pegmatite	9,319,750	1.82	189,582	468,268

Table 4: Reserve Table[2]

Reserve Category	Tonnes	Li2O %	Contained Li2O (t)	LCE(t)
Open Pit
Proven	1,190,000	2.39	28,441	70,249
Probable	2,930,000	1.93	56,549	139,676
Sub total	4,120,000	2.06	84,872	209,634
Underground
Probable	1.65	1.84	30,360	74,989
Total (OP+UG)	5.77	2.00	115,400	285,038

The Corporation has expended to December 31, 2020 a total of $13,458,911 in acquisition and deferred exploration costs. Reserve LCE/PAK Lithium Project acquisition/exploration costs total an estimated CAD $45.54/LCE, a justified investment given that current battery grade carbonate pricing is approximately $8,000 / tonne in global markets.

Lithium and market analysts consider 20 years supply of 20k tonnes LCE or 400k tonnes LCE total as being a key project metric for evaluating companies and projects globally. With PAK deposit reserves currently at 285,038 LCE, management in early 2018 set out looking for approximately 5 million additional near surface tonnes on the PAK Lithium Project. With the discovery of the Spark pegmatite only 2km from the PAK deposit, the Corporation has deemed Spark as the most cost-effective way of sourcing an additional 114,962 LCE to hit the “chemical grade” feedstock metric as outlined above. This is an attainable goal given that Spark maintains approximately twice the surface area of the PAK deposit and drilling results to date have intersected strong grades and thicknesses.

The current ratio of PAK deposit reserve to resource is 0.76 from the 2018 PFS, and when using that factor, approximately 151,265 LCE resource is required and therefore being targeted within 300 metres of surface on the Spark showing. Using a conservative grade of 1.35% Li2O in the bulk pegmatite and 10% contingency it is estimated that approximately 5 million tonnes of measured and indicated

2 Reserves’ categories are compliant with Canadian Institute of Mining, Metallurgy and Petroleum (CIM) Definitions Standards for mineral resources in concordance with National Instrument 43-101 – Standards of Disclosure for Mineral Projects. The cut-off grade for the open pit Mineral Reserves Li2O Eq. ≥ 0.4% and the cut-off grade for the underground Mineral Reserves is Li2O ≥ 0.80%. The effective date of the Mineral Reserves estimate is March 23, 2020. Numbers are rounded to the nearest thousand.

resource is required to meet the 20 year, 20k LCE objective. In conclusion, the above rationale has been used for the short-term exploration expenditures on the project and establish management’s goal with the maiden resource estimate of 5 - 10 million tonnes that fall under all categories (measured and indicated).

On February 4[th] , 2020, the Company announced the N.I. 43-101 maiden mineral resource estimated for the Spark pegmatite (see Table 4) including 3.2 MT in indicated averaging 1.59% Li2O and 12.2 MT averaging 1.36% Li2O in the inferred categories.

Table 5: Summary of Mineral Resource Estimate for the Spark Pegmatite[3]

Cut-Off	Resource Category	Tonnes (t)	Li2O (%)	Nb2O5 (ppm)	Cs2O (%)	Ta2O5 (ppm)	Rb2O (%)	SnO2 (ppm)	Lithology
0.65%	Indicated	3,248,000	1.59	56	0.015	123	0.26	68	Aplite/LIZ
Li2O	Inferred	12,228,000	1.36	45	0.020	107	0.23	53	Aplite/LIZ

The deposit remains open in all directions and preliminary electron microprobe data suggest much of the spodumene within the pegmatite contains iron levels in spodumene that are consistent with technical grade concentrates. It is estimated that an expenditure of $750,000 and 2,000 metres of future drilling is required to increase the resource up to the measured and indicated goal mentioned above. The company is planning on accomplishing the drilling and resource update in Fiscal 2022.

V. SELECTED FINANCIAL INFORMATION

3 Mineral Resource Estimate Notes:

1. Mineral Resources were prepared in accordance with NI 43-101 and the CIM Definition Standards (2014). Mineral resources that are not mineral reserves do not have demonstrated economic viability. This estimate of mineral resources may be materially affected by environmental, permitting, legal, title, taxation, sociopolitical, marketing, or other relevant issues.

2. Open pit Mineral Resources are reported at a cut-off grade of 0.65 % Li2O that is based on a spodumene concentrate prices of US$700/tonne and an exchange rate of 1.3.

3. Appropriate mining costs, processing costs, metal recoveries, and inter ramp pit slope angles were used by WSP to generate the pit shell.

4. Rounding may result in apparent summation differences between tonnes, grade, and contained metal content.

5. Tonnage and grade measurements are in metric units.

6. Contributing assay composites were capped at 3.55% Li2O.

7. A bulk density factor of 2.718 was applied to the pegmatite based on 241 measurements. Modeling was performed using GEOVIA Surpac® 2019 software with grades estimated using ordinary kriging (OK) interpolation methodology. Samples were composited at 1.0 metre down hole and composites were capped at 3.55% Li2O. Block grades were estimated on a multi pass basis with a minimum and maximum number of composites required for each estimation pass. Block size is 2 metre by 2 metre (y) by 2 metre (z).

Additional information about the Mineral Resource modeling methodology will be documented in the upcoming NI 43-101 technical report (the "Technical Report").

The following table summarizes the Corporations’ selected key financial data taken from the consolidated statements of loss for the nine months ended December 31, 2020 and 2019 as well as the consolidated statement of financial position as at December 31, 2020, and March 31, 2020.

Consolidated statements of Loss	Consolidated statements of Loss	Consolidated statements of Loss
	Nine-months ended December
	30
Earnings and loss	2020	2019
	($)	($)
Loss before income taxes	1,558,674	1,449,091
Net loss	1,437,474	1,372,861
Loss per share, basic and diluted	$(0.008)	$(0.009)

Consolidated statements of Financial Position	Consolidated statements of Financial Position	Consolidated statements of Financial Position
	Period	Ended
	December 30, 2020	March 31, 2020
	($)	($)
Cash and cash equivalents	691,808	565,946
Restricted cash (flow-through expenditures)	1,330,495	196,232
Working capital	1,570,817	313,245
Total assets	15,720,262	13,552,282
Total liabilities	563,121	665,469
Shareholder’s Equity	15,157,141	12,886,813

CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT DECEMBER 31, 2020

As at December 31, 2020, the current assets of the Corporation were at $2,133,938, an increase of $1,155,224 when compared to March 31, 2020. The increase in the total assets during the nine-month period ended is mostly due to the increase in cash and cash equivalents.

Statement of Operations, Comprehensive Loss and Deficit

For the six months ended September 30

penses Stock option compensation (Notes 6) Consulting (Notes 6) Wages and benefits Vehicle and travel General and administrative Professional fees Depreciation Shareholder and investor relations Insurance Telephone Office rental (Note 6) Bank charges and interest Foreign exchange Net loss before items below Other income Unrealized gain (loss) on investments - FVTPL Realized loss on investments Loss on extinguishment of debt {Note 8(f)} Net loss before income taxes Income tax expense Deferred Net loss and comprehensive loss for the year Deficit, beginning of period Deficit, end of period	2020 2019 $ 804,697 $ - 252,468 301,291 98,439 193,677 37,558 128,311 219,932 201,894 74,174 86,664 37,057 53,213 2,428 - 17,209 17,138 9,029 12,747 6,750 6,750 6,190 4,788 747 977 1,566,678 1,456,639 (1,566,678) (1,456,639) - - 8,004 (7,348) -14,896 - - (1,558,674)(1,449,091) (121,200) (76,230) $ (1,437,474) $ (1,372,861) (25,557,003) (23,910,492) (26,994,477) (25,283,353) $(0.008) $(0.009) 169,129,595 157,502,473
Basic and diluted loss per share Weighted average number of shares

penses
Stock option compensation (Notes 6)
Consulting (Notes 6)
Wages and benefits
Vehicle and travel
General and administrative
Professional fees
Depreciation
Shareholder and investor relations
Insurance
Telephone
Office rental (Note 6)
Bank charges and interest
Foreign exchange
Net loss before items below
Other income
Unrealized gain (loss) on investments - FVTPL
Realized loss on investments
Loss on extinguishment of debt {Note 8(f)}
Net loss before income taxes
Income tax expense
Deferred
Net loss and comprehensive loss for the year
Deficit, beginning of period
Deficit, end of period

2020
2019
$
804,697
$ -
252,468
301,291
98,439
193,677
37,558
128,311
219,932
201,894
74,174
86,664
37,057
53,213
2,428
-
17,209
17,138
9,029
12,747
6,750
6,750
6,190
4,788
747
977
1,566,678
1,456,639
(1,566,678)
(1,456,639)
-
-
8,004
(7,348)

-14,896

-
-
(1,558,674)(1,449,091)

(121,200) (76,230)
$ (1,437,474)
$ (1,372,861)
(25,557,003)
(23,910,492)
(26,994,477)
(25,283,353)
$(0.008)
$(0.009)
169,129,595
157,502,473

Basic and diluted loss per share
Weighted average number of shares

Expenses

Table 6: Statement of Operations, Comprehensive Loss and Deficit

The results for the nine-month period ended December 31, 2020 show a loss before other items and income taxes of $1,558,674 ($1,449,091 for the same period in the previous year) as seen in Table 6. The Corporation has no revenue from operations.

As seen in the previous consolidated statement of loss and comprehensive loss, the main expense variations between the current year and previous years comparative figures having an impact on the net loss and not including stock option compensations are: i) decrease by $156,551 with the combined consultant fees, professional fees, wages and benefits mainly due to a decrease in the corporate human resources activities.; ii) promotion and advertising combined with representation, missions and trade shows decreased vehicle and travel expenses by $90,753; iii) general and administrative expense increase of $18,038.

FINANCING ACTIVITIES FOR THE NINE-MONTH PERIOD ENDED DECEMBER 31, 2020

Between April 1, 2020 and December 31, 2020:

200,000 options were exercised at a price of $0.16 per share for aggregate gross proceeds of $32,000 by a board member. Shareholders did not exercise warrants during the six-month period ending September 30, 2020.

62,500 warrants were exercised at a price of $0.27 per share for aggregate gross proceeds of $16,875 by a board member during the nine-month period ending December 31, 2020.

The Corporation requested approval for a Non-Brokered Private Placement pursuant to which the Corporation issued 750,00 common shares at a price of $0.20 per share for aggregate gross proceeds of $150,000 and 9,327,000 common shares at a price of $0.20 per share for aggregate gross proceeds of $1,865,400.

The Corporation requested approval for a Non-Brokered Flow Through Private Placement to which the Corporation issued 3,025,710 common shares at a price of $0.35 per share for aggregate gross proceeds of $1,058,998.55 for the nine-month period ending December 31, 2020.

INVESTING ACTIVITIES FOR THE NINE-MONTH PERIOD ENDED DECEMBER 31, 2020

During the nine-month period ended December 31, 2020, a net amount of $1,049,813 was used in investing activities comprised primarily of pilot metallurgical testwork to produce lithium concentrates and bench scale testwork to produce lithium chemicals as well as diamond drilling related activies. For details on the investment activities, please refer to the “Highlights for the nine- month period ended December 31, 2020 and up to the date of this report and next steps” section at the beginning of this document under the sub-sections “Exploration” and “Development”.

VI. SELECTED QUARTERLY DATA

Operating results for each of the last 9 quarters are presented in the table below. The data related to these quarters were prepared in the same manner as that of the audited financial statements for the fiscal year ended March 31, 2020.

		Loss per
	Net Profit or	share –
Operating results as of:
	(Loss)	basic

	($)	($)
December 31, 2020	(1,437,474)	(0.008)
September 30, 2020	(1,185,578)	(0.007)
June 30, 2020	(170,469)	(0.001)
Year Ended 2020	(1,646,511)	(0.01)
March 31, 2020	(273,650)	(0.001)
December 31, 2019	(816,075)	(0.005)
September 30, 2019	(230,847)	(0.002)
June 30, 2019	(325,939)	(0.001)
Year Ended 2019	(1,643,458)	(0.01)
March 31, 2019	(178,600)	(0.001)
December 31, 2018	(463,319)	(0.003)

ACTIVITIES IN THE COMMON SHARES, SHARE PURCHASE OPTIONS, WARRANTS ISSUED TO SHAREHOLDERS AND COMPENSATION OPTIONS TO BROKERS:

Refer to Note 7 of the consolidated financial statements as at and for the period ended December 31, 2020 for the detailed breakdown on this section.

COMMON SHARES AND FINANCING SOURCES:

The Corporation issued 750,000 common shares and generated $150,000 in cash and cash equivalents during the three-months ended June 30, 2020 to total 162,852,672.

The Corporation issued 9,327,000 common shares and generated $1,865,400 in cash and cash equivalents during the six-months ended September 30, 2020 to total 172,179,672.

The Corporation issued 3,025,710 common shares and generated $1,058,998.55 in cash and cash equivalents during the nine-months ended December 31, 2020 to total 175,405,382

OPTIONS:

During the current period, a total of 5,450,000 options were issued at a weighted average price of $0.25 per share, a total of 8,050,000 options were cancelled at a weighted average price of $0.46 per share, a total of 1,633,334 options had expired at a weighted average price of $0.19 and 200,000 options were exercised at a weighted average price of $0.16. At the time of this report the Corporation has 8,266,666 outstanding options at a weighted average exercise price of $0.26.

In September 2020, 200,000 options were exercised to buy 200,000 common shares of the company for total gross proceeds of $32,000.

WARRANTS ISSUED TO SHAREHOLDERS:

As at September 30, 2020 the Corporation had 11,572,627 outstanding share purchase warrants with a weighted average price of $0.38 as a result of a current financing and financings within the past two calendar years.

In December 2020, 62,500 warrants were exercised to buy 62,500 common shares of the company for total gross proceeds of $16,875.

As at December 31, 2020 the Corporation had 13,161,240 outstanding share purchase warrants with a weighted average price of $.39 as a result of a current financing and financings within the past two calendar years.

VII. OUTLOOK:

COVID-19 has spurred demand growth for EVs and EV related shares have produced exceptional investment returns in 2020. To justify these valuations EV penetration rates are either set to exceed the most bullish forecasts or little or no yield is all shareholders can hope for in most cases. Even if actual future EV sales "disappoint" EV company valuations -upstream battery metal demand will be significant. According to market followers, Tesla received over 100,000 orders for the locally made Model Y in China in the first 24 hours after launch. The Cybertruck is still attracting over 6,000 orders a day globally. There are 660 billion reasons why Tesla needs to exceed sales forecasts, and we believe, provided Giga Berlin and Austin launch on time, that 900K - 1M unit sales in 2021 are not out of the question. Assuming consensus is 800K, an additional ~150K sales of high nickel cathode models by Tesla would generate ~10KT LCE of additional battery quality hydroxide demand not factored in by the market. In 2022 Tesla's unforeseen hydroxide demand could be far greater just as competing new (European) battery plants come online. We see potential upside demand surprises in a range of other upper-end EVs with larger battery packs containing high nickel cathodes. By 2025 we see China representing only 40% of global EV sales and the rest of the world 60%. By GWh deployed, we see an even greater skew towards the rest of the world as Chinese consumers favour smaller EV models.

RK EQUITY Lithium Chemical Supply/Demand to 2028 (LCE)

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----- Start of picture text -----

1,800,000
1,700,000
1,600,000
1,500,000
1,400,000
1,300,000
1,200,000
1,100,000 61%
1,000,000
900,000 59%
800,000
700,000 56%
600,000 54%
500,000 50%
400,000 45%
300,000200,000100,000 24%76% 30%70% 35%65% 41%59% 55% 50% 46% 44% 41% 39%
0
2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Carbonate battery demand Hydroxide battery demand Grease/Ceramics etc Supply
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Figure 8: Chemical Supply and Demand forecast with LiOH growth (Source: RK Equity)

The Corporation remains focused on its strategy of advancing and de-risking the project with the ability to supply a wide range of lithium products used in “green technology” applications. Demonstration of spodumene concentrate product could help the specialty glass and ceramics sector achieve efficiencies that reduce consumption of fossil fuels, energy costs and greenhouse gas emissions. Demonstration of lithium chemical products are required for the electrification of transportation (EV’s) and other energy storage applications remains an additional objective for the Corporation.

The PAK Lithium Project is the highest quality lithium mineral resource in North America due to its high-grade and low impurity properties. The monetary value of low-iron (Fe) spodumene is greater than the more common, higher iron spodumene. Furthermore, a low Fe spodumene is also well suited to potentially produce a high-yielding chemical-grade lithium concentrates which is used to produce lithium chemicals which form the basis for manufacture of, among other applications, lithium-ion batteries for laptop computers, mobile phones, electric bicycles and electric/hybrid vehicles.

==> picture [242 x 146] intentionally omitted <==

Figure 9: N.American Lithium Resource comparison by grade

Lithium Market

During December, 99.5% lithium carbonate China spot prices were up 6.4%. Lithium hydroxide prices were up 0.74%. Spodumene (6% min) prices were up 0.21%. Fastmarkets reports 99.5% lithium carbonate battery grade spot midpoint prices cif China, Japan & Korea of US$6.75/kg (US$6,750/t), and min 56.5% lithium

hydroxide battery grade spot midpoint prices cif China, Japan & Korea of US$9.00/kg (US$9,000/t). Benchmark Mineral Intelligence has November global weighted average prices at US$5,700/t for Li carbonate, US$8,837/t for Li hydroxide, and US$380/t for spodumene (6%).

Demand led by the EV market is now forecasting a structural deficit of lithium supply. Tesla expects significant battery shortages in 2022 and beyond. According to WoodMac, nearly 800 kt LCE of additional lithium needed next 5 years. At the same time EU sounds alarm on critical raw materials shortages. The EU’s over-reliance on imports of critical raw materials threatens to undermine crucial industries and expose the bloc to supply squeezes by China and other resource-rich countries. The document is part of an urgent focus in Europe on security of imports of vital goods. The emerging strategy prioritises securing the supply of a list of raw materials critical to European industries through exploration, investment and improved recycling. The EU estimates that to meet its climate neutrality goal, it will need up to 18 times more lithium and five times more cobalt in 2030. The forecasts rise to 60 times more lithium and 15 times more cobalt by 2050. The deficit starting after 2022, as can be seen by Figure 8 below:

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Figure 10: Lithium Market Balance

Supply from high grade hard rock pegmatites is filling the increased market supply as a means of diversification from the brines of South America as they have seen little growth since 2006. The unsustainability of lithium’s record high price spike was exposed in early-2018 as the industry began to feel the effects of the race to new production which had occurred in Australia’s spodumene sector. By mid-2018, with four new hard rock operations set for production, spodumene had overtaken brine as the leading source of chemical feedstock production. The number of active mines had climbed from 1 in 2016 to 9 by the end of 2018. The false narrative which emerged from these expansions and spilled over into 2019 was that the industry was awash with battery-grade lithium chemicals, sufficient to support rapid electrification over coming years. Despite the pandemic, 2020 will see Volkswagen debut the I.D. Crozz. Volvo will launch the XC40 Recharge; and Audi will add the e-tron Sportback to its line, although not all have been confirmed for the U.S. Ford’s highly anticipated Mach-E SUV is still slated to launch in the U.S. in late 2020, but European deliveries won’t happen until early 2021. While the supply response has addressed the relatively minor growth of today, it is still far from meeting the needs of announced EV expansions, similar to the one announced by GM and Ford in Ontario.

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The Current State

EV OEM valuations are skyrocketing

For the market, Fall 2020 has been head-turning for the EV industry. In July, Tesla surpassed Toyota to become the world's most valuable automaker.

Long-term, EVs are on target

By 2025, there will be more than 600 different BEV and HEV models available globally. Bloomberg New Energy Finance forecasts global BEV sales will grow from 1.7 million in 2020 to 8.5 million in 2025, 26 million in 2030 and 54 million in 2040, representing 58% of anticipated new car sales.

Energy Storage and Battery Recycling

EV lithium-ion batteries are designed for about 14 years of useful life to accommodate the demanding needs of vehicles. At the moment, vehicle manufacturers typically offer an 8–10-year warranty for the battery of their plugin products. However, these batteries still contain at least 70% of their total capacity and many years of operation after they’re no longer fit for vehicles, making them prime candidates for less- demanding, stationary applications, such as residential and commercial electric power management, power grid stabilization and renewable energy storage.

Electric vehicles sold globally through 2020 could provide between 120 and 549 GWh in energy storage capacity by 2028 — representing a significant amount of storage capacity that is both cost-effective and more environmentally friendly than lead- acid batteries. Many companies such as Groupe Renault, Nissan Motor Company and Toyota Motor Corporation are testing the economic and operational viability of different applications.

As EV growth takes off over the next decade, battery demand could exact a toll on our environment and communities given its fragile supply chain that has often sparked human rights concerns.

VIII. BASIS OF PREPARATION:

STATEMENT OF COMPLIANCE:

The financial statements for the nine- month period ended December 31, 2020 have been prepared in accordance with IFRS.

The accounting policies applied in these financial statements are based on IFRS issued and in effect as at December 31, 2020. On February 19, 2021, the Board of Directors approved for filling on SEDAR the third quarter financial statements.

BASIS OF MEASUREMENT:

The third quarter financial statements have been prepared on the historical cost basis, except for investment which are recorded at fair value.

The third quarter financial statements have been prepared on a going concern basis, meaning the Corporation would be able to realize its assets and discharge its liabilities in the normal course of operations.

FUNCTIONAL AND PRESENTATION CURRENCY:

The third quarter financial statements are presented in Canadian dollars, which is the Corporation’s functional currency.

USE OF ESTIMATES AND JUDGMENTS:

The preparation of the third quarter financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the year in which the estimates are revised and in any future years affected.

Information about critical judgments in applying accounting policies that have the most significant effect on the amounts recognized in the financial statements is included in Note 1 - the determination that the Corporation is in the exploration and development of mining properties; in Note 2 – capitalized cost and recoverability of property, plant and equipment.

IX. SIGNIFICANT ACCOUNTING POLICIES:

The preparation of the third quarter financial statements in conformity with IFRS requires management to apply accounting policies and make estimates and assumptions that effect amounts reported in the audited financial statement and notes. There is full disclosure of the Corporation’s significant accounting policies and accounting estimates in Note 2 of the third quarter financial statements for the nine-months ended December 31, 2020 and 2019.

X. FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT:

OFF BALANCE SHEET AGREEMENTS

The Corporation has not concluded any off-balance sheet agreements.

RELATED PARTY TRANSACTIONS

During the nine-months ended December 31, 2020 and 2019 the Company incurred the following expenditures with companies controlled by a director of the company and a company controlled by an officer of the company:

Description	September 30, 2020	September 30, 2019
Office rental (paid to companies controlled by corporate director)	$ 6,750	$ 6,750
Consulting	$187,000	$187,000

The transactions above are in the normal course of operation and are measured at the exchange amount which is the amount of consideration established and agreed to by the related parties.

OBLIGATIONS AND CONTRACTUAL COMMITMENTS

The Corporation had the following significant commitments as at the date of this report:

A) In late March of 1999, the Corporation entered into an option agreement to earn a 100% interest in one mining claim included in the PAK property. Upon complying with the terms of the agreement, the Corporation exercised the option and acquired 100% interest in the claim. The vendor kept a 2.5% Net Smelter Return ("NSR") royalty on the mining claim. For an amount of $1,000,000, 1% of this royalty may be purchased once the Corporation has officially declared it is in commercial production. The claim has since been to mining lease (ML) 109669. The PAK deposit as currently known is located on this lease.
B) In early December of 2010, the Corporation entered into an agreement with two private individuals to acquire 100% of three mining claims collectively called the Pakeagama south-east. In 2015 the Corporation completed the earn-in and now owns the claims 100%. The vendors kept a 2.5% NSR royalty on the mining claims. For an amount of $1,500,000, 1.5% of this royalty may be purchased once the Corporation has officially declared it is in commercial production.
C) During 2018 Frontier entered into an agreement with a private individual with regards to a parcel of 35 claims cells totalling 684 hectares in the Favourable Lake area along the “Electric Avenue” on the northwestern limits of the PAK Lithium Project. Another agreement was reached with another private individual to acquire 2 mining claim groups totalling 176 ha in the same area. Frontier now owns 100% of both sets of claims and are contiguous with the PAK Project claims. Both individuals each have a 1.5% and a 0.5% Net Smelter Royalty (NSR) on their respective properties acquired by the Corporation.
D) The Corporation entered into private agreements with four First Nation Communities that neighbour the project properties for the purpose of ongoing exploration and development (including advanced exploration). Obligations to date have been accrued.

RISK EXPOSURE AND MANAGEMENT

The Corporation is exposed to risks of varying degrees of significance which could affect its ability to achieve its strategic objectives. The main objective of the Corporation’s risk management processes is to ensure that the risks are properly identified and that the capital base is adequate in relation to those risks. Risks include metal price fluctuations and the low success rate for the discovery of new deposits. Industry competition and lack of funding may also limit opportunities. Future political, regulatory and environmental changes could affect any aspect of the Corporation’s business including property title, taxation, aboriginal issues and environmental protection. More detail of the principal risks to which the Corporation is exposed to are described below:

MARKET, INTEREST AND CURRENCY RISK:

Market risk is the risk that changes in market prices, such as interest rates, foreign exchange rates and equity prices will affect the Corporation’s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimizing the return. The Corporation strategically operates in Canada in order to reduce sovereign and foreign exchange risks amongst. Management therefore believes at the current status of exploration and development the current risk management policy is adequate.

CREDIT RISK:

Credit risk refers to the risk that counterparty will default on its contractual obligations resulting in a financial loss to the group. Credit risk arises from cash and cash equivalents with banks and financial institutions as well as credit exposures to outstanding receivables.

It is management’s opinion that the Corporation is not exposed to significant credit risk arising from these financial instruments.

LIQUIDITY RISK AND CASH RESTRICTIONS:

The Corporation has no history of profitable operations and its present business is exploration and development resulting in pre cash-flow. As such, the Corporation is subject to many risks common to such enterprises, including under-capitalization, cash shortages and limitations with respect to personnel, financial and other resources and the lack of revenues. There is no assurance that the Corporation will be successful in achieving a return on shareholders’ investment and the likelihood of success must be considered in light of its exploration and development stage of operations.

The Corporation has no source of operating cash flow and no assurance that additional funding will be available to it for further exploration and development of its projects when required. Although the Corporation has been successful in the past in obtaining financing through the sale of equity securities, there can be no assurance that the Corporation will be able to obtain adequate financing in the future or that the terms of such financing will be favorable. Failure to obtain such additional financing could result in the delay or indefinite postponement of further exploration and development of its properties.

However, the Corporation believes that there is sufficient cash and other short-term assets readily convertible into cash in order to meets its liabilities when they come due. The Corporation’s cash is held in business accounts with a Canadian bank. Management believes that liquidity risk is moderate. The Corporation manages liquidity risk through the management of its capital structure and continuously monitors actual and projected cash flows.

LITHIUM PRICE RISK:

The Corporation is subject to lithium price risk from fluctuations in the market prices for lithium salts and spodumene concentrates. The risk is compounded by the fact that lithium contracts are private, therefore there is a relative opaqueness to the market in general which may cause increased levels of price pressures to the Corporations’ stock price. Price risks are affected by many factors that are outside of the Corporation’s control, including but not limited to, global or regional consumption patterns, the supply of and demand for metals, speculative activities, the availability and costs of technical grade spodumene concentrate substitutes by lithium compounds, lithium compound substitutes, inflation, political and economic conditions. Figure 10 below displays price pressures since July 2019 to the date of this report on chemical grade spodumene concentrate (CG_SC6.0) freight-on-board (“FOB”) Australia. The price decrease in feedstock to conversion plants in China have attributed to approximately 50% reduction in the lithium equity market since March 2018. Despite having the rare technical grade spodumene from the PAK deposit, the Corporation’s stock performance has not been insulated from declining feedstock prices in Australia and rates this risk moderate to high. Management believes that the Phase I Demonstration plant development could reduce this risk by differentiating the Corporation’s low-iron assets to the lower quality Australian feedstock supplying Chinese chemical plants in the future.

==> picture [506 x 303] intentionally omitted <==

Figure 11: Chemical Grade Spodumene FOB Australia

CAPITAL MANAGEMENT:

All of the Corporation’s properties are 100% owned with minimal holding costs. The Corporation’s current rate of cash consumption, excluding expenditures on work programs or cost associated with financing is approximately $65,000 per month.

The Corporation’s capital management objective is to have sufficient capital to be able to pursue its activities in order to ensure the growth of its assets, finance the investing activities and its working capital requirements.

In order to maintain or adjust the capital structure, the Corporation may issue new capital instruments, obtain debt financing and acquire or sell mining properties or other assets, to improve its financial performance and flexibility.

The access to financing depends on the economic situation and state of the equity and credit markets.

PROPERTY TITLES

The Property encompasses 26,774 hectares in total, is 100% owned by Frontier and there are no co-proponents or partners for the Project up to the date of this report. According to the Mining Act and regulations of the Province of Ontario, to renew its claims, the Corporation must incur a minimum of exploration expenditures on an annual basis. As at the date of this report, all claims are in good standing and the Corporation has approx. $2.0M in assessment credits from the Ministry of Energy, Northern Development and Mines (MENDM) that can be used to renew its claims on the PAK property. Currently, the Corporation maintains 1,378 mining claims and Mining claim KRL-1232241 was converted to Mining Lease KL-109669 in 2017. A letter of intent to convert 108 mining claim cells to a mining lease was submitted to MENDM in April 2018 and an additional 11 mining claim cells in November 2018 to encompass the Spark Pegmatite. This process is anticipated to be completed in 2020-2021.

XI. RISK FACTORS RELATED TO THE CORPORATION

CONDITIONS OF THE INDUSTRY IN GENERAL

The exploration and development of mineral resources, including construction, start-up and operation of a mine and the construction, start-up and operation of a mill (concentrator plant), involves significant risks that even an allied neat evaluation with experience and know-how cannot avoid. Although the discovery of a deposit can prove extremely lucrative, few properties where exploration and development work are carried out become producing mines thereafter. Important expenditures are necessary to establish ore reserves, to work out the representative metallurgical processes and to build the mining plant on a particular site. It is impossible to provide assurance to the effect that the current state of the project contemplated by the Corporation will generate a profit. The mineral industry is intensely competitive in all its phases. The Corporation competes with many other mineral exploration companies who have greater financial resources and technical capacity.

The mining activities comprise a high level of risk. The activities of the Corporation are subject to all the dangers and the risks usually dependent on the exploration and the development, including the unusual and unforeseen geological formations, explosions, collapses, floods and other situations which can occur during drilling and the removal of material and of which any could cause physical or material or environmental injuries and, possibly, legal responsibility.

GOVERNMENTAL REGULATION

The activities of the Corporation are subject to various federal, provincial and local laws, which relate to the exploration and development, taxes, standards of work, diseases and the occupational safety, the safety in mines and transformation plants, toxic substances, the protection of the environment and others. The development is subject to legislative measures and laws with the federal, provincial and local levels relating to the protection of the environment. These laws impose high standards on the mining industry and on the chemicals industry, in order to control the rejects of waste water and to force the participants to account for such controls to the lawful authorities, to reduce or eliminate the impact that are generated by certain production activities; extraction and of treatment and which are later on deposited on the ground or are rejected into the air or the water, to complete work of restoration of the mining properties, to control dangerous waste and materials and to reduce the risk of industrial accidents. The defect to conform to the above-mentioned legislative measures can involve important fines and other penalties.

RISKS OF LAWSUITS AND NON-INSURABLE RISKS

The Corporation could be held responsible for pollution or for other risks against which it could not be insured or against which it could choose not to be insured, given the high cost of the premiums or for other reasons. The payment of sums in this respect could involve the loss of the assets of the Corporation.

CONFLICTS OF INTEREST

Some of the directors and officers of the Corporation are engaged as directors or officers of other Corporation’s involved in the exploration and development of mineral resources. Such engagement could result in conflicts of interest. Any decision taken by these directors and officers and involving the Corporation will be in conformity with their duties and obligations to compromise in an equitable way and in good faith with the Corporation and these other corporations. Moreover, these directors and officers will declare their interests and will abstain to vote on any question which could give place to a conflict of interest.

PERMITS, LICENCES AND AUTHORIZATIONS

The activities of the Corporation require obtaining on a timely manner and maintaining permits and licenses from various governmental authorities. The Corporation considers that it holds all the permits and licenses required for the activities it currently explores on, in accordance with the relevant laws and by-laws. Changes brought to the laws and regulations could affect these permits and licenses. Nothing guarantees that the Corporation can obtain all the permits and all the necessary licenses in order to continue its exploration activities, to build mines or mining

plants and to begin mining operations on its property. At present the Corporation has approved Exploration Permit # PR-14-10611 authorizing activities of mechanized drilling, mechanical stripping and pitting and trenching in the general vicinity of the PAK deposit. The duration of the permit is from March 6[th] , 2018 until March 5[th] , 2021. Terms of the permit require that surface stripping shall not exceed an area of 10,000 m2 or a volume of 10,000 m3.

In addition, the Corporation has approved Exploration Permit # PR-18-000258 authorizing the same activities mentioned above from January 30, 2019 until January 30, 2022 in the general vicinity of the Spark pegmatite showing.

DEPENDENCE ON THE MANAGEMENT

The Corporation is dependent towards certain persons of its management. The loss of their services could have an unfavorable impact on the Corporation. Management maintains a strong equity position in the Corporation, therefore considers this risk to be low.

PRICE OF LITHIUM SALTS AND SPODUMENE CONCENTRATE

The price of the common shares, financial results of the Corporation, its activities could undergo in the future important negative effects because of the fall of the prices of the lithium concentrates and compounds, resulting in an impact on the capacity of the Corporation to finance its activities and impact its results. The prices of lithium concentrates and compounds may fluctuate in an important way and are tributary to various factors which are independent of the will of the Corporation, such as the sale or the purchase of lithium compounds by various brokers, the rates of interest, foreign exchange rates, the rates of inflation or deflation, the fluctuations in the value of the Canadian dollar and other currencies, the regional and world offer and demand, the economic conjuncture and policy which prevails in the countries of the world which are large lithium compounds producers.

GOING CONCERN AND INSOLVENCY RISK

The Corporation’s financial statements have been prepared on a going concern basis, which assumes that the Corporation will be able to realize its assets and discharge its liabilities in the normal course of business as they come due into the foreseeable future. The Corporation does not currently have guaranteed sources of funding or cash flows and the inability to successfully generate revenues from operations cast significant doubt as to the appropriateness of the going concern assumption.

THE CORPORATION’S DEPENDENCE UPON THE ADVANCED EXPLORATION PROJECT (PHASE I DEMONSTRATION CONCENTRATOR)

The Corporation expects future potential development of the Phase I Advanced Exploration program plans at the PAK deposit will help determine the Corporation’s future possible ore material and production capabilities in a Commercial Operation unless additional sources of spodumene sources are acquired or discovered on the PAK project and/or permitted to supply and brought into production. Any adverse conditions affecting potential spodumene concentrates production from the planned Phase I development program at the PAK deposit could be

expected to have a material adverse effect on the Corporation’s financial performance, results of operations and prospects and will require the Corporation to raise additional financing, which may not be obtainable under such circumstances. While the Pre-Feasibility Technical Report demonstrates the potential economic feasibility of a potential Commercial Project, the inability to achieve commercial operations on a basis that is economically viable will have a material adverse effect on the Corporation.

INFRASTRUCTURE, SUPPLIES, INFLATION AND OPERATION COSTS

The PAK Lithium Project is located 175 km north of Red Lake, Ontario in the Red Lake Mining District and is situated on Crown Land. The centre of the Project is located on National Topographic System map sheet reference is 53C/11 at approximately 52°36’N latitude and 93°23’W longitude near Pakeagama Lake. Access to the Property is available year-round by chartered ski or float equipped aircraft from Red Lake. The project is located in a relatively isolated area of north-western Ontario where infrastructure consists of a winter road, which services the First Nation communities of Deer Lake (40km west of the project), Sandy Lake (50km north), and North Spirit Lake (30km east). The winter road runs over the mining claims on the west side of the project with vehicular access to the Property during winter months of February and March. Bearskin Airways, Wasaya Air and Superior Air services the nearby First Nation communities of Deer Lake, North Spirit Lake, and Sandy Lake with daily flights year-round. Currently, access to the property occurs from May 15 (after break-up) to October 15 (5 months) via float plane, and from February 1st, to March 15 (1.5 months) via the winter road.

NO CURRENT PLANS TO PAY CASH DIVIDENDS

The Corporation has no current plans to pay any cash dividends for the foreseeable future. Any decision to declare and pay dividends in the future will be made at the discretion of the Board of Directors and will depend on, among other things, the Corporation’s financial results, cash requirements, contractual restrictions and other factors that the Board of Directors may deem relevant. In addition, the Corporation’s ability to pay dividends may be limited by covenants of any existing and future outstanding indebtedness that the Corporation or its subsidiaries incur. As a result, investors may not receive any return on an investment in the Corporation’s securities unless they sell the securities for a price greater than that which they paid for them.

DILUTION

Additional financing needed to continue funding the development and operation of the Corporation may require the issuance of additional securities of the Corporation. The issuance of additional securities and the exercise of common share purchase warrants, options and other convertible securities will result in dilution of the equity interests of any persons who are or may become holders of common shares.

XII. DISCLOSURE CONTROLS AND PROCEDURES AND INTERNAL CONTROLS OVER FINANCIAL REPORTING

As a publicly listed entity, management must take steps to ensure that material information regarding the reports filed or submitted under securities legislation fairly presents the financial information. Responsibility for this resides with management, including the President and Chief Executive Officer and the acting Chief Financial Officer. Management is responsible for establishing, maintaining and evaluating the design of disclosure controls and procedures, as well as internal control over financial reporting.

DISCLOSURE CONTROLS AND PROCEDURES (DC&P)

Management is responsible for establishing and maintaining a system of disclosure controls and procedures to provide reasonable assurance that all material information relating to the Corporation and its subsidiaries is gathered and reported to senior management on a timely basis so that appropriate decisions can be made regarding public disclosure.

INTERNAL CONTROL OVER FINANCIAL REPORTING (ICFR)

Management is responsible for establishing and maintaining adequate internal controls over financial reporting to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial reports for external purposes in accordance with IFRS.

During the period from April 1, 2020 to December 31, 2020, no changes were made to the Corporation’s ICFR that has materially affected, or is reasonably likely to materially affect, the Corporation’s ICFR.

In designing of DC&P and ICFR, the Corporation recognizes that any controls and procedures, no matter how well conceived or operated, can only provide reasonable, not absolute, assurance that the objectives of the control system are met.

ADDITIONAL DISCLOSURE FOR VENTURE ISSUERS WITHOUT SIGNIFICANT REVENUE

Additional disclosure concerning Frontier’s general and administrative expenses and mineral property costs is provided in the Company’s audited statement of loss contained in its audited financial statements for the year ended March 31, 2020.