G2 Goldfields Inc. — Annual Report 2022

Sep 26, 2022

G2 GOLDFIELDS INC.

CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED MAY 31, 2022 (EXPRESSED IN CANADIAN DOLLARS)

Independent Auditor's Report

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To the Shareholders of G2 Goldfields Inc.:

Opinion

We have audited the consolidated financial statements of G2 Goldfields Inc. and its subsidiaries (the "Company"), which comprise the consolidated statements of financial position as at May 31, 2022 and May 31, 2021, and the consolidated statements of loss and comprehensive loss, changes in equity and cash flows for the years then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as at May 31, 2022 and May 31, 2021, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with International Financial Reporting Standards.

Basis for Opinion

We conducted our audits in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audits of the consolidated financial statements in Canada, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Other Information

Management is responsible for the other information. The other information comprises Management’s Discussion and Analysis.

Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audits of the consolidated financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audits or otherwise appears to be materially misstated. We obtained Management’s Discussion and Analysis prior to the date of this auditor’s report. If, based on the work we have performed on this other information, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with International Financial Reporting Standards, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Company’s financial reporting process.

Auditor's Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audits and significant audit findings, including any significant deficiencies in internal control that we identify during our audits.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

The engagement partner on the audit resulting in this independent auditor's report is Brock Stroud.

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Toronto, Ontario September 23, 2022

Chartered Professional Accountants Licensed Public Accountants

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G2 Goldfields Inc.

Consolidated Statements of Financial Position (Expressed in Canadian Dollars)

G2 Goldfields Inc. Consolidated Statements of Financial Position (Expressed in Canadian Dollars)
As at May 31,		2022	2021
ASSETS
Current
Cash	$	1,252,612 $	2,037,445
Short-term investments (note 6)		64,063	72,000
Amounts receivable (note 7)		69,839	86,504
Due from related parties (note 17)		142,527	127,043
Prepaids		35,830	66,981
Total current assets		1,564,871	2,389,973
Non-Current
Fixed assets (note 8)		230,498	248,596
Mining interests (note 9)		16,101,243	11,283,721
Total non-current assets		16,331,741	11,532,317
Total assets	$	17,896,612 $	13,922,290
LIABILITIES
Current
Accounts payable and accrued liabilities	$	831,134 $	797,428
Due to related parties (note 17)		136,415	227,110
Total current liabilities		967,549	1,024,538
Total liabilities		967,549	1,024,538
SHAREHOLDERS' EQUITY
Share capital (note 10)		57,856,667	52,013,845
Warrants (note 11)		679,662	1,679,424
Contributed surplus (note 12 and 15)		10,224,749	8,775,464
Deficit		(49,767,924)	(47,564,247)
Cumulative Translation Adjustment		(2,064,091)	(2,006,734)
Total shareholders' equity		16,929,063	12,897,752
Total liabilities and shareholders' equity	$	17,896,612 $	13,922,290

Nature of Operations (note 1) Subsequent events (note 18)

Approved on behalf of the Board:

"Bruce Rosenberg" "Daniel Noone" Director Director

The accompanying notes are an integral part of these consolidated financial statements.

• 1 -

G2 Goldfields Inc.

Consolidated Statements of Loss and Comprehensive Loss (Expressed in Canadian Dollars)

G2 Goldfields Inc. Consolidated Statements of Loss and Comprehensive Loss (Expressed in Canadian Dollars)
For the years ended May 31,		2022		2021
Revenue
Royalties(note 3(m))	$	346,114	$	436,327
Operating expenses
Share-based compensation (note 12 and 15)		812,677		1,597,695
Professional fees		170,024		234,048
Wages and employee benefits		586,530		486,537
Office rent and utilities		207,148		250,820
Office and administrative		340,889		348,110
Transfer agent and filing fees		122,709		316,498
Insurance		19,005		13,356
Investor and community relations		239,133		156,043
Interest expense		14,979		11,349
Depreciation		51,964		54,864
Total operating loss		(2,218,944)		(3,032,993)
Unrealized (loss) gain on short-term investments		(2,937)		17,000
Gain (loss) on foreign exchange		18,204		(74,864)
Loss on spin-out of mininginterest(note 9(a))		-		(9,736,131)
Net loss before income taxes		(2,203,677)		(12,826,988)
Income tax expense		-		(88,472)
Net loss for theyear		(2,203,677)		(12,915,460)
Other comprehensive loss
Cumulative translation adjustment		(57,357)		(1,702,740)
Loss and comprehensive loss for theyear	$	(2,261,034)	$(14,618,200)
Loss and comprehensive loss per share
- basic and diluted (note 13)	$	(0.02)	$	(0.11)
Weighted average number of common shares outstanding
- basic and diluted(note 13)		134,164,100	120,706,737

The accompanying notes are an integral part of these consolidated financial statements. - 2 -

G2 Goldfields Inc.

Consolidated Statements of Cash Flows (Expressed in Canadian Dollars)

G2 Goldfields Inc. Consolidated Statements of Cash Flows (Expressed in Canadian Dollars)
For the years ended May 31,		2022	2021
Operating activities
Net loss for the year	**$ **	(2,203,677)	$(12,915,460)
Items not affecting cash:
Depreciation (note 8)		51,964	54,864
Share-based compensation (note 12)		812,677	1,597,695
Unrealized (gain) loss on short-term investments		2,937	(17,000)
Loss on spin-out of mining interest (note 9(a))		-	9,736,131
Foreign exchange		(76,897)	(323,895)
		(1,412,996)	(1,867,665)
Changes in non-cash working capital items:
Amounts receivable		16,665	(71,105)
Due from related parties		(90,695)	(127,043)
Due to related parties		(15,484)	(168,800)
Prepaid expenses		31,151	(17,937)
Accounts payable and accrued liabilities		33,706	(161,111)
Net cash used in operating activities		(1,437,653)	(2,413,661)
Investing activities
Mining interests		(4,798,310)	(3,605,556)
Redemption (Purchase) of short-term investments		5,000	(50,000)
Fixed assets		(33,538)	(69,412)
Net cash used in investing activities		(4,826,848)	(3,724,968)
Financing activities
Private placements		3,060,000	5,000,000
Share issue costs		(53,581)	(318,770)
Proceeds from stock options exercised		892,000	551,250
Proceeds from warrants exercised		1,581,249	2,359,819
Net cash provided by financing activities		5,479,668	7,592,299
Net change in cash and cash equivalents		(784,833)	1,453,670
Cash, beginning of year		2,037,445	583,775
Cash, end of year	$	1,252,612	$ 2,037,445

The accompanying notes are an integral part of these consolidated financial statements. - 3 -

G2 Goldfields Inc.

Consolidated Statements of Changes in Equity (Expressed in Canadian Dollars)

(Expressed in Canadian Dollars)
										Cumulative
	Number of		Share				Contributed			Translation		Total
	Shares		Capital		Warrants		Surplus	Deficit		Adjustment
Balance, May 31, 2020	106,653,991	$	45,930,579	$	1,325,981	$	7,287,746	$ (34,648,787)	$	(303,994)	$	19,591,525
Exercise of RSU's	200,000		34,000		-		(34,000)	-		-		-
Exercise of stock options	1,650,000		941,410		-		(390,160)	-		-		551,250
Exercise of warrants	8,341,230		2,920,192		(560,373)		-	-		-		2,359,819
Warrants expired	-		-		(314,183)		314,183	-		-		-
Units issued for private
placement (note 10)	9,711,537		3,772,001		1,227,999		-	-		-		5,000,000
Share issue costs	-		(318,770)		-		-	-		-		(318,770)
Spin-out of Sandy Lake Project (note 9(a))	-		(1,265,567)		-		-	-		-		(1,265,567)
Stock based compensation (note 12)	-		-		-		1,597,695	-		-		1,597,695
Net loss for the year	-		-		-		-	(12,915,460)		(1,702,740)		(14,618,200)
Balance May 31, 2021	126,556,758	$	52,013,845	$	1,679,424	$	8,775,464	$ (47,564,247)	$	(2,006,734)	$	12,897,752
Exercise of RSU's	100,000		17,000		-		(17,000)	-		-		-
Exercise of stock options	2,620,000		1,467,639		-		(575,639)	-		-		892,000
Exercise of warrants	5,525,000		2,031,426		(450,177)		-	-		-		1,581,249
Warrants expired	-		-		(1,229,247)		1,229,247	-		-		-
Units issued for private
placement (note 10)	6,800,000		2,380,338		679,662		-	-		-		3,060,000
Share issue costs	-		(53,581)		-		-	-		-		(53,581)
Stock based compensation (note 12)	-		-		-		812,677	-		-		812,677
Net loss for the year	-		-		-		-	(2,203,677)		(57,357)		(2,261,034)
Balance May 31, 2022	141,601,758	$	57,856,667	$	679,662	$	10,224,749	$ (49,767,924)	$	(2,064,091)	$	16,929,063

The accompanying notes are an integral part of these consolidated financial statements. - 4 -

G2 Goldfields Inc. Notes to Consolidated Financial Statements Year Ended May 31, 2022 (Expressed in Canadian Dollars)

1. NATURE OF OPERATIONS

G2 Goldfields Inc. ("G2" or the "Company") was incorporated as 7177411 Canada Corporation on May 21, 2009, under the laws of Canada. The Company is primarily engaged in the business of acquiring and exploring mineral properties. The common shares of the Company trade on the TSX Venture Exchange under the symbol “GTWO”.

The head office, principal address, and records office of the Company are located at 141 Adelaide Street West, Suite 1101, Toronto, Ontario, Canada, M5H 3L5.

The COVID-19 outbreak has been declared a pandemic by the World Health Organization. The situation is dynamic and the ultimate duration and magnitude of the impact on the economy, capital markets and the Company’s financial position cannot be reasonably estimated at this time. The Company is monitoring developments and will adapt its business plans accordingly. The actual and threatened spread of COVID-19 globally could adversely impact the Company’s ability to carry out its plans and raise capital. Exploration activities in Guyana remain to be operational as the Company has setup an isolated camp to continue its drill program.

The Company’s consolidated financial statements were authorized for issue by the Board of Directors on September 23, 2022.

2. BASIS OF PREPARATION

(a) Statement of Compliance

These consolidated financial statements have been prepared in accordance with International Accounting Standards using accounting policies consistent with the International Financial Reporting Standards (“IFRS”) issued by the International Accounting Standards Board (“IASB”) and Interpretations of the International Financial Reporting Interpretations Committee (“IFRIC”).

(b) Basis of Consolidation

These consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries Bartica Investments Ltd. (Bartica) and Ontario Inc (Ontario). The statements of the subsidiaries are included in the consolidated financial statement from the date control commences until the date control ceases. The Company’s subsidiaries are wholly owned and all inter-company transactions, balances, including income and expenses arising from inter-company transactions are eliminated in preparing these consolidated financial statements.

(c) Basis of Measurement

The consolidated financial statements have been prepared on a historical cost basis except for financial instruments classified at fair value through profit or loss ("FVTPL") which are stated at fair values. The accounting policies have been applied consistently throughout all years presented in these financial statements.

(d) Functional and Presentation Currency

The consolidated financial statements are presented in Canadian dollars, which is the functional currency of the Company. The functional currency of Bartica is United States dollars and the functional currency of Ontario is Guyanese dollars.

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G2 Goldfields Inc. Notes to Consolidated Financial Statements Year Ended May 31, 2022 (Expressed in Canadian Dollars)

2. BASIS OF PREPARATION (CONTINUED)

(e) Use of Estimates and Judgment

The preparation of financial statements in conformity with IFRS requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Areas requiring significant estimates and judgments by management include, but are not limited to:

• Share-based compensation – management is required to make a number of estimates when determining the compensation expense resulting from share-based transactions, including the forfeiture rate and expected life of the instruments.

• Income taxes – measurement of income taxes payable and deferred income tax assets and liabilities requires management to make judgments in the interpretation and application of the relevant tax laws. The actual amount of income taxes only become final upon filing and acceptance of the tax return by the relevant authorities, which occurs subsequent to the issuance of the financial statements.

• Mining interests - the Company capitalizes the exploration and evaluation expenditures in the statement of financial position. Where an indicator of impairment exists, management will perform an impairment test and if the recoverable amount is less than the carrying value, record an impairment charge.

• Inter-company loans - the Company applies judgment when assessing whether loans to its subsidiaries are part of its net investment in foreign operations or long-term loans expected to be repaid in future periods.

• Distribution of non-cash assets - management uses estimates to assess the fair value of distributions of non-cash assets to shareholders of the Company.

3. SIGNIFICANT ACCOUNTING POLICIES

Overall considerations

The significant accounting policies that have been applied in the preparation of these consolidated financial statements are summarized below. These accounting policies have been used throughout all periods presented in the consolidated financial statements.

Areas of judgment that have the most significant effect on amounts recognized in the financial statements are disclosed above.

(a) Cash

Cash comprises of cash on hand.

(b) Fixed Assets

On the initial recognition, fixed assets are valued at cost, being the purchase price and directly attributable costs of acquisition. Fixed assets are subsequently measured at cost less accumulated depreciation, less any accumulated impairment losses. Gains and losses on disposal of an item are determined by comparing the proceeds from disposal with the carrying cost amount and are recognized on the statement of loss and comprehensive loss.

Depreciation is recognized in the statement of loss and comprehensive loss over their estimated useful lives. Machinery and equipment and furniture and equipment is depreciated at a 15% declining balance rate. Motor vehicles is depreciated at a 20% declining balance rate.

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G2 Goldfields Inc. Notes to Consolidated Financial Statements Year Ended May 31, 2022 (Expressed in Canadian Dollars)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(c) Exploration and Evaluation Assets

Exploration and evaluation assets include mining interests

Exploration and evaluation costs, including the cost of acquiring licenses, are capitalized as exploration and evaluation assets on a project-by-project basis pending determination of the technical feasibility and the commercial viability of the project. The capitalized costs are presented as either tangible or intangible exploration and evaluation assets according to the nature of the assets acquired. Capitalized costs include costs directly related to exploration and evaluation activities in the area of interest. General and administrative costs are only allocated to the asset to the extent that those costs can be directly related to operational activities in the relevant area of interest. When a license is relinquished or a project is abandoned, the related costs are recognized in net loss immediately.

Exploration and evaluation assets are assessed for impairment if (i) sufficient data exists to determine technical feasibility and commercial viability, and (ii) fact and circumstances suggest that the carrying amount exceeds the recoverable amount (see Impairment).

The technical feasibility and commercial viability of extracting a mineral resource is considered to be determinable when proven reserves are determined to exist, the rights of tenure are current and it is considered probable that the costs will be recouped through successful development and exploitation of the area, or alternatively by sale of the property. Upon determination of proven reserves, intangible exploration and evaluation assets attributable to those reserves are first tested for impairment and then reclassified from exploration and evaluation assets to a separate category within tangible assets. Expenditures deemed to be unsuccessful are recognized in net loss immediately. The Company capitalizes all costs to defend title of its mining interests.

Pre-exploration and evaluation expenditures

Exploration and evaluation costs incurred prior to acquiring the right to explore mining interests are expensed as exploration and evaluation assets on a project-by-project basis. If the costs incurred cannot be directly attributed to a project that is going to be pursued beyond the pre- exploration and evaluation stage, they are expensed.

Title

Ownership in mineral properties involves certain risks due to the difficulties in determining the validity of certain claims as well as the potential for problems arising from the frequently ambiguous conveyancing history characteristic of many mineral interests.

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G2 Goldfields Inc. Notes to Consolidated Financial Statements Year Ended May 31, 2022 (Expressed in Canadian Dollars)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(d) Income Taxes

Income tax on the profit or loss for the period presented comprises current and deferred tax. Income tax is recognized in profit or loss except to the extent that it relates to items recognized directly in equity, in which case it is recognized in equity.

Current tax expense is the expected tax payable on the taxable income for the period, using tax rates enacted or substantively enacted at period end, adjusted for amendments to tax payable with regards to previous years.

Deferred tax is recorded for temporary differences, between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred income taxes are recorded to recognize tax benefits only to the extent, based on available evidence, that it is probable that they will be realized. The following temporary differences are not provided for: goodwill not deductible for tax purposes; and the initial recognition of assets or liabilities that affect neither accounting nor taxable loss.

The amount of deferred tax provided is based on the expected manner of realization or settlement of the carrying amount of assets and liabilities, using tax rates expected to be applied to temporary differences which may reverse, based on tax laws, enacted or substantively enacted at the statement of financial position date.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Company intends to settle its current tax assets and liabilities on a net basis.

(e) Share-based Payments

Equity-settled share-based payments to employees and others providing similar services are measured at the fair value of the equity instruments at the grant date. Details regarding the determination of the fair value of equity-settled share-based transactions are set out in the share- based payments note (see note 12).

For options to employees that do not immediately vest, the fair value is measured at the grant date and each tranche is recognized on a graded-vesting basis over the period in which the options vest. At the end of each reporting period, the Company revises its estimate of the number of equity instruments expected to vest. The impact of the revision of the original estimates, if any, is recognized in the statement of loss and comprehensive loss such that the cumulative expense reflects the revised estimate, with a corresponding adjustment to reserve for share-based payments.

Equity-settled share-based payment transactions with parties other than employees are measured at the fair value of the goods or services received, except where that fair value cannot be estimated reliably, in which case they are measured at the fair value of the equity instruments granted, measured at the date the entity obtains the goods or the counter party renders the service.

(f) Basic and Diluted Earnings (Loss) per Share

Basic earnings (loss) per share is based on the weighted average number of common shares of the Company outstanding during the period. The diluted earnings (loss) per share reflects the potential dilution of common share equivalents, such as outstanding share options, restricted share unit’s and warrants, in the weighted average number of common shares outstanding during the period, if dilutive.

• 8 -

G2 Goldfields Inc. Notes to Consolidated Financial Statements Year Ended May 31, 2022 (Expressed in Canadian Dollars)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(g) Share Issuance Costs

Professional, consulting, regulatory fees and other costs that are directly attributable to the issuance of shares are charged to capital stock when the related shares are issued. Transaction costs of abandoned equity transactions are recognized in the statement of loss and comprehensive loss.

(h) Warrants

Proceeds from unit placements are allocated between shares and warrants issued by calculating the value of the warrants using the Black-Scholes option pricing model and allocating on a relative fair value basis. The value of the share component is credited to share capital and the value of the warrant component is credited to reserve for warrants account. Upon exercise of the warrants, consideration paid by the warrant holder together with the amount previously recognized in the reserve for warrants account is recorded as an increase to capital stock. For those warrants that expired unexercised, the recorded value is transferred to Contributed Surplus.

(i) Provisions

Provisions are recognized when the Company has a present obligation (legal or constructive) that has arisen as a result of a past event and it is probable that a future outflow of resources will be required to settle the obligation, provided that a reliable estimate can be made of the amount of the obligation.

Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a pre-tax rate that reflects current market assessments of the time value of money and the risk specific to the obligation. The increase in the provision due to passage of time is recognized as interest expense.

(j) Financial Instruments

Financial assets and financial liabilities are recognized when the Company becomes a party to the contractual provisions of the financial instrument.

Below is a summary showing the classification and measurement bases of the Company’s financial instruments.

Classification	IFRS 9
Cash	FVTPL
Short-term investments	FVTPL
Due from related parties	Amortized Cost
Accounts payable and other liabilities	Amortized Cost
Due to relatedparties	Amortized Cost

Financial assets

Financial assets are classified as either financial assets at FVTPL, amortized cost, or FVTOCI. The Company determines the classification of its financial assets at initial recognition.

Financial assets recorded at FVTPL

Financial assets are classified as FVTPL if they do not meet the criteria of amortized cost or FVTOCI. Gains or losses on these items are recognized in profit or loss.

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G2 Goldfields Inc. Notes to Consolidated Financial Statements Year Ended May 31, 2022 (Expressed in Canadian Dollars)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(j) Financial Instruments (continued)

Investments recorded at fair value through other comprehensive income (FVOCI)

On initial recognition of an equity investment that is not held for trading, the Company may irrevocably elect to measure the investment at FVOCI whereby changes in the investment’s fair value (realized and unrealized) will be recognized permanently in OCI with no reclassification to profit or loss. The election is made on an investment-by-investment basis.

Amortized cost

Financial assets are classified as measured at amortized cost if both of the following criteria are met and the financial assets are not designated as at FVTPL: 1) the object of the Company’s business model for these financial assets is to collect their contractual cash flows, and 2) the asset’s contractual cash flows represent "solely payments of principal and interest".

Financial liabilities

Financial liabilities are classified as either financial liabilities at FVTPL or at amortized cost. The Company determines the classification of its financial liabilities at initial recognition.

Amortized cost

Financial liabilities are classified as measured at amortized cost unless they fall into one of the following categories: financial liabilities at FVTPL, financial liabilities that arise when a transfer of a financial asset does not qualify for derecognition, financial guarantee contracts, commitments to provide a loan at a below-market interest rate, or contingent consideration recognized by an acquirer in a business combination.

Financial liabilities recorded FVTPL

Financial liabilities are classified as FVTPL if they fall into one of the five exemptions detailed above.

Transaction costs

Transaction costs associated with financial instruments, carried at FVTPL, are expensed as incurred, while transaction costs associated with all other financial instruments are included in the initial carrying amount of the asset or the liability.

Subsequent measurement

Instruments classified as FVTPL are measured at fair value with unrealized gains and losses recognized in profit or loss. Instruments classified as amortized cost are measured at amortized cost using the effective interest rate method. Instruments classified as FVTOCI are measured at fair value with unrealized gains and losses recognized in other comprehensive income.

Derecognition

The Company derecognizes financial liabilities only when its obligations under the financial liabilities are discharged, cancelled, or expired. The difference between the carrying amount of the financial liability derecognized and the consideration paid and payable, including any non- cash assets transferred or liabilities assumed, is recognized in profit or loss.

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G2 Goldfields Inc. Notes to Consolidated Financial Statements Year Ended May 31, 2022 (Expressed in Canadian Dollars)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(j) Financial Instruments (continued)

Financial instruments at fair value through profit and loss

Financial instruments recorded at fair value on the statements of financial position are classified using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The fair value hierarchy has the following levels:

• Level 1 - valuation based on quoted prices (unadjusted) in active markets for identical assets or liabilities;

• Level 2 - valuation techniques based on inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

• Level 3 - valuation techniques using inputs for the asset or liability that are not based on observable market data (unobservable inputs).

As at May 31, 2022 and 2021, the Company did not hold financial instruments recorded at fair value that would require classification within the fair value hierarchy, except for cash (Level 1) and short-term investments (Level 1). The carrying value of the financial instruments noted above approximate their fair value due to the short-term nature of these instruments.

(k) Impairment

The carrying amounts of the Company’s non-financial assets, other than deferred tax assets, are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated.

For the purpose of impairment testing, assets are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of assets (the “cash-generating unit”).

An impairment loss is recognized if the carrying amount of a cash-generating unit exceeds its estimated recoverable amount. The recoverable amount of an asset or a cash-generating unit is the greater of its value in use and its fair value less costs of disposal. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessment of the time value of money and the risks specific to the assets. Impairment losses are recognized in net loss.

Impairment losses recognized in prior years are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation, if no impairment loss had been recognized.

• 11 -

G2 Goldfields Inc. Notes to Consolidated Financial Statements Year Ended May 31, 2022 (Expressed in Canadian Dollars)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(l) Business Combinations

Business combinations are accounted for under the acquisition method. The consideration transferred for the acquisition of a subsidiary is the fair value of the assets transferred, the liabilities incurred and the equity interests issued by the Company, if any, at the date control is obtained. The consideration transferred includes the fair value of any liability resulting from a contingent consideration arrangement. Acquisition-related costs, other than share and debt issue costs incurred to issue financial instruments that form part of the consideration transferred, are expensed as incurred. Identifiable assets acquired and liabilities assumed in a business combination are measured initially at their fair value at the acquisition date. If a business combination is achieved in stages, the Company remeasures its previously held interest in the acquiree at its acquisition-date fair value and recognizes the resulting gain or loss, if any, in net income. Contingent consideration is classified as a provision and is measured at fair value, with subsequent changes recognized in income. If the contingent consideration is classified as equity, it is not remeasured until it is finally settled within equity. New information obtained during the measurement period, up to 12 months following the acquisition date, about facts and circumstances existing at the acquisition date affect the acquisition accounting.

(m) Royalties

The Company earns royalties from small scale miners in Guyana. Small scale miners extract gold from the Company’s exploration interests and pay a royalty to the Company, which is in the form of physical gold. The Company will then deposit the royalty with the Guyana Gold Board. Royalties earned by the Company are also subject to a net smelter return (“NSR”), payable to the original property owners. Revenue received by the Guyana Gold Board is recognized net of the NSR, once the Company has deposited the royalty with the Guyana Gold Board and there is a reasonable expectation of collection.

Under IFRS 15, revenue is recognized at an amount that reflects the expected consideration receivable in exchange for transferring goods or services to a customer, applying the following five steps:

1. Identify the contract with a customer

2. Identify the performance obligations in the contract

3. Determine the transaction price

4. Allocate the transaction price to the performance obligations in the contract

5. Recognize revenue when (or as) the entity satisfies a performance obligation

6. 12 -

G2 Goldfields Inc. Notes to Consolidated Financial Statements Year Ended May 31, 2022 (Expressed in Canadian Dollars)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(n) Foreign currency translation

Transactions in foreign currencies other than the functional currency are translated into the functional currency using the exchange rates prevailing on the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated at the period end exchange rate with the resulting gains and losses being recognized in the consolidated statements of operations and comprehensive loss.

Non-monetary assets and liabilities that are measured in terms of historical cost in a foreign currency are not retranslated.

The financial statements of foreign subsidiaries for which the functional currency is not the Canadian dollar are translated into Canadian dollars using the exchange rate in effect at the end of the reporting period for assets and liabilities and the average exchange rates for the period for revenue, expenses and cash flows. Foreign exchange differences arising on translation are recognized in other comprehensive income (loss) and in the cumulative transaction adjustment in shareholders’ equity.

(o) Accounting standards issued but not yet effective

The standards and interpretations that are issued, but not yet effective, up to the date of issuance of the Company’s Financial Statements that the Company reasonably expects will have an impact on its disclosures, financial position or performance when applied at a future date, are disclosed below. The Company intends to adopt these standards, if applicable, when they become effective.

Classification of Liabilities as Current or Non-Current (Amendments to IAS 1)

The IASB has published Classification of Liabilities as Current or Non-Current (Amendments to IAS 1) which clarifies the guidance on whether a liability should be classified as either current or non-current. The amendments:

• clarify that the classification of liabilities as current or non-current should only be based on rights that are in place "at the end of the reporting period"

• clarify that classification is unaffected by expectations about whether an entity will exercise its right to defer settlement of a liability; and

• make clear that settlement includes transfers to the counterparty of cash, equity instruments, other assets or services that result in extinguishments of the liability.

This amendment is effective for annual periods beginning on or after January 1, 2023. There is currently a proposal in place to extend effective date for annual periods beginning on or after January 1, 2024. Earlier application is permitted. The extent of the impact of adoption of this amendment has not yet been determined.

Definition of Accounting Estimates – Amendments to IAS 8

In February 2021, the IASB issued amendments to IAS 8, in which it introduced a definition of ‘accounting estimates’. The amendments clarify the distinction between changes in accounting estimates and changes in accounting policies and the correction of errors. Also, they clarify how entities use measurement techniques and inputs to develop accounting estimates. The amendments are effective for annual reporting periods beginning on or after January 1, 2023, and apply to changes in accounting policies and accounting estimates that occur on or after the start of that period. Earlier application is permitted as long as this fact is disclosed.

The amendments are not expected to have a material impact on the Company.

• 13 -

G2 Goldfields Inc. Notes to Consolidated Financial Statements Year Ended May 31, 2022 (Expressed in Canadian Dollars)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(o) Accounting standards issued but not yet effective (continued)

Disclosure of Accounting Policies - Amendments to IAS 1 and IFRS Practice Statement 2

In February 2021, the IASB issued amendments to IAS 1 and IFRS Practice Statement 2 Making Materiality Judgements, in which it provides guidance and examples to help entities apply materiality judgements to accounting policy disclosures. The amendments aim to help entities provide accounting policy disclosures that are more useful by replacing the requirement for entities to disclose their ‘significant’ accounting policies with a requirement to disclose their ‘material’ accounting policies and adding guidance on how entities apply the concept of materiality in making decisions about accounting policy disclosures. The amendments to IAS 1 are applicable for annual periods beginning on or after January 1, 2023, with earlier application permitted. Since the amendments to the Practice Statement 2 provide non-mandatory guidance on the application of the definition of material to accounting policy information, an effective date for these amendments is not necessary. The Company is currently assessing the impact of the amendments to determine the impact they will have on the Company’s accounting policy disclosures.

Amendments to IAS 12 Income taxes

Deferred Tax related to Assets and Liabilities arising from a Single Transaction clarifies the accounting for deferred tax on transactions such as leases and decommissioning obligations by removing the initial recognition exemption for transactions in which equal amounts of deductible and taxable temporary differences arise on initial recognition. The amendments are effective for annual periods beginning on or after January 1, 2023.

(p) Leases

All leases are accounted for by recognizing a right-of-use asset and a lease liability except for:

• Leases of low value assets; and

• Leases with a duration of twelve months or less.

Lease liabilities are measured at the present value of the contractual payments due to the lessor over the lease term, with the discount rate determined by the incremental borrowing rate on commencement of the lease is used. Variable lease payments are only included in the measurement of the lease liability if they depend on an index or rate. In such cases, the initial measurement of the lease liability assumes the variable element will remain unchanged throughout the lease term. Other variable lease payments are expensed in the period to which they relate.

On initial recognition, the carrying value of the lease liability also includes:

• Amounts expected to be payable under any residual value guarantee;

• The exercise price of any purchase option granted if it is reasonable certain to assess that option;

• Any penalties payable for terminating the lease, if the term of the lease has been estimated on the basis of termination option being exercised.

Right-of-use assets are initially measured at the amount of the lease liability, reduced for any lease incentives received, and increased for:

• Lease payments made at or before commencement of the lease;

• Initial direct costs incurred; and

• The amount of any provision recognised where the Company is contractually required to dismantle, remove or restore the leased asset.

• 14 -

G2 Goldfields Inc. Notes to Consolidated Financial Statements Year Ended May 31, 2022 (Expressed in Canadian Dollars)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(p) Leases (continued)

Lease liabilities, on initial measurement, increase as a result of interest charged at a constant rate on the balance outstanding and are reduced for lease payments made.

Right-of-use assets are amortized on a straight-line basis over the remaining term of the lease or over the remaining economic life of the asset if this is judged to be shorter than the lease term.

When the Company revises its estimate of the term of any lease, it adjusts the carrying amount of the lease liability to reflect the payments to make over the revised term, which are discounted at the same discount rate that applied on lease commencement. The carrying value of lease liabilities is similarly revised when the variable element of future lease payments dependent on a rate or index is revised. In both cases an equivalent adjustment is made to the carrying value of the right-of-use asset, with the revised carrying amount being amortized over the remaining (revised) lease term.

4. FINANCIAL INSTRUMENTS AND OBJECTIVES AND POLICIES

The Company manages its exposure to a number of different financial risks arising from operations as well as from the use of financial instruments, including market risks (foreign currency exchange rate and interest rate), credit risk and liquidity risk, through its risk management strategy. The objective of the strategy is to support the delivery of the Company's financial targets while protecting its future financial security and flexibility. Financial risks are primarily managed and monitored through operating and financing activities. The Company does not use derivative financial instruments. The financial risks are evaluated regularly with due consideration to changes in key economic indicators and to up-to-date market information. The Company’s risk exposures and the impact on the Company’s financial instruments are summarized below:

(a) Credit Risk

Credit risk is the financial risk of non-performance of a contracted counter party. The Company's credit risk is primarily attributable to cash, short-term investments and due from related parties. The Company reduces its credit risk by maintaining its cash with reputable financial institutions. The credit risk on related parties is nominal.

(b) Liquidity Risk

Liquidity risk is the risk that the Company will not be able to meet its obligations associated with financial liabilities as they come due. The Company’s investment policy is to invest its excess cash in high grade investment securities with varying terms to maturity, selected with regard to the expected timing of expenditures for continuing operations. The Company monitors its liquidity position and budgets future expenditures, in order to ensure that it will have sufficient capital to satisfy liabilities as they come due.

As at May 31, 2022, the Company had current liabilities of $967,549 (May 31, 2021 - $1,024,538) and has cash of $1,252,612 (May 31, 2021 - $2,037,445) to meet its current obligations. The Company regularly evaluates its cash position to ensure preservation and security of capital as well as maintenance of liquidity.

• 15 -

G2 Goldfields Inc. Notes to Consolidated Financial Statements Year Ended May 31, 2022 (Expressed in Canadian Dollars)

4. FINANCIAL INSTRUMENTS AND OBJECTIVES AND POLICIES (CONTINUED)

(c) Price Risk

Price risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices (other than those arising from interest rate or currency risk). The short-term investment held by the Company are subject to normal fluctuations and the risks inherent in investment in financial markets. The maximum risk resulting from financial instruments held by the Company are equivalent to the fair value of the financial instruments. Management moderates this risk by employing experienced management who oversee the investment activities of the Company and monitor the investments on a regular basis.

As at May 31, 2021, the impact of a plus or minus 10% change in the quoted market price of short-term investments held, with all other variables held constant, would affect reported loss and comprehensive loss by approximately $1,900 (May 31, 2021 - $2,200).

(d) Market Risk

Foreign Currency Risk

The Company’s functional currency is the Canadian dollar. The Company has a subsidiary that has a functional currency in Guyanese dollars. Sensitivity to a plus or minus 5% change in the foreign exchange rate of the Guyanese dollar compared to the Canadian dollar would affect the Company’s equity by $792,000 (2021 – $558,506) with all other variables held constant.

Interest Rate Risk

Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate due to changes in market interest rates. The Company has no significant risk to future cash flows from interest rate risk. The Company does not use derivative instruments to reduce its exposure to interest rate risk.

5. CAPITAL MANAGEMENT

The Company considers its capital to consist of its shareholders’ equity balance, which as at May 31, 2022, totaled $16,929,063 (May 31, 2021 - $12,897,752).

The Company's objective when managing capital is to maintain adequate levels of funding to support its exploration activities and to maintain corporate and administrative functions necessary to support operational activities.

The Company manages its capital structure in a manner that provides sufficient funding for operational activities. Funds are primarily secured through equity capital raised by way of private placements. There can be no assurance that the Company will be able to continue raising equity capital in the future.

The Company invests all capital that is surplus to its immediate operational needs in short-term, liquid and highly rated financial instruments, such as cash and other short-term guaranteed deposits, and all are held in major financial institutions.

There were no changes to the Company's approach to capital risk management during the year ended May 31, 2022 and the Company is not subject to any externally imposed capital requirements.

• 16 -

G2 Goldfields Inc. Notes to Consolidated Financial Statements Year Ended May 31, 2022 (Expressed in Canadian Dollars)

6. SHORT-TERM INVESTMENTS

Short-term investments consist of marketable securities and Canadian Guaranteed Investments (“GICs”) which have been designate as FVTPL. As at each period end, short-term investments are recorded at fair value, with changes recognized in the statement of loss and comprehensive loss. The fair value of marketable securities are determined using the last bid price and the fair value of GICs are determined by reference to the risk-free market rate of interest at period end. Short-term investments are composed of the following:

	Number of				Fair Market
May 31, 2022	securities		Cost		Value
Big River Gold Ltd.	62,500	$	211,604	$	19,063
GIC's	-		45,000		45,000
	62,500	$	256,604	$	64,063
	Number of				Fair Market
May 31, 2021	securities		Cost		Value
Big River Gold Ltd.	62,500	$	211,604	$	22,000
GIC's	-		50,000		50,000
	62,500	$	261,604	$	72,000

During the year ended May 31, 2022, a (loss) gain on marketable securities totaling ($2,937) (May 31, 2021 - $17,000) was recognized in the consolidated statements of loss and comprehensive loss.

7. AMOUNTS RECEIVABLE

May 31,		2022		2021
Receivables	$	25,681	$	2,238
Harmonized sales tax - Canada		44,158		84,266
Total	$	69,839	$	86,504

• 17 -

G2 Goldfields Inc. Notes to Consolidated Financial Statements Year Ended May 31, 2022 (Expressed in Canadian Dollars)

8. FIXED ASSETS

	Furniture and	Furniture and	Machinery and	Machinery and
Cost		equipment		equipment		Vehicles		Total
Balance, May 31, 2020	$	7,151	$	216,693	$	80,432	$	304,276
Additions		1,758		18,356		49,298		69,412
Foreign currencyadjustment		(990)		(27,795)		(13,002)		(41,787)
Balance, May 31, 2021		7,919		207,254		116,728		331,901
Additions		560		1,171		31,807		33,538
Foreign currencyadjustment		11		288		189		488
Balance, May 31, 2022	$	8,490	$	208,713	$	148,724	$	365,927
	Furniture and		Machinery and
Accumulated Amortization		equipment		equipment		Vehicles		Total
Balance, May 31, 2020	$	449	$	23,777	$	12,155	$	36,381
Depreciation		1,284		37,435		16,145		54,864
Foreign currencyadjustment		(137)		(5,289)		(2,514)		(7,940)
Balance, May 31, 2021		1,596		55,923		25,786		83,305
Depreciation		1,019		28,645		22,300		51,964
Foreign currencyadjustment		3		103		54		160
Balance, May 31, 2022	$	2,618	$	84,671	$	48,140	$	135,429
Carrying amounts
Balance, May 31, 2021	$	6,323	$	151,331	$	90,942	$	248,596
Balance, May 31, 2022	$	5,872	$	124,042	$	100,584	$	230,498

9. MINING INTERESTS

The Company enters into exploration agreements or permits with other companies or foreign governments under which it may explore or earn interests in mineral properties by issuing common shares and making an option or rental payments and incurring expenditures in varying amounts by varying dates. Failure by the Company to meet such requirements can result in a reduction or loss of the Company’s ownership interests or entitlements under the agreements or permits.

• 18 -

G2 Goldfields Inc. Notes to Consolidated Financial Statements Year Ended May 31, 2022 (Expressed in Canadian Dollars)

9. MINING INTERESTS (CONTINUED)

		Sandy Lake
		Project	Guyana Project	Total
Balance, May 31, 2020	$10,867,285		$ 9,157,576	$20,024,861
Additions		134,413	3,471,143	3,605,556
Spin-out of Sandy Lake Project(a)	(11,001,698)		-	(11,001,698)
Foreign currencyadjustment		-	(1,344,998)	(1,344,998)
Balance, May 31, 2021		-	11,283,721	11,283,721
Additions		-	4,798,310	4,798,310
Foreign currencyadjustment		-	19,212	19,212
Balance, May 31, 2022	$	-	$16,101,243	$16,101,243

(a) Sandy Lake Project, Ontario, Canada

On November 20, 2020, the Company incorporated S2 Minerals Inc. (“S2”), a wholly owned subsidiary of G2 at the time, issuing one share to G2 in exchange for a nominal amount of cash.

On February 2, 2021, G2 and S2 entered into an arrangement agreement (the “Spin-Out Arrangement”), subject to approval by the Company’s shareholders, to transfer its Sandy Lake Gold Properties to S2 in exchange for shares of S2 that are to be distributed pro-rata to the shareholders of G2.

On April 9, 2021, the Spin-Out Arrangement was completed, and the Sandy Lake Gold Properties were transferred to S2 in exchange for 12,655,667 common shares of S2, and immediately distributed to the shareholders of the Company on a pro-rata basis, with one share of S2 received for every ten shares of G2 held. In connection with the Spin-Out Arrangement, the carrying value of Sandy Lake Gold properties totaling $11,001,698 were derecognized, and the S2 shares were treated as a distribution of capital to the shareholders of the Company. In accordance with IFRIC 17, the distribution was valued at $1,265,567 based on the fair value of the common shares of S2 and the Company recorded a loss on spin-out of mining interests totaling $nil (May 31, 2021 - $9,736,131) in the consolidated statement of loss and comprehensive loss for the year ended May 31, 2022.

(b) Guyana Projects, Guyana, South America

There are currently artisanal workings on one of the Guyana Project properties and the operators pay production royalties to the Company which are reflected as royalty revenue.

The Oko Option Agreement

Through the Oko option agreement (which was executed on December 22, 2017), the Company has the right to acquire a 100% interest in 8 mining permits. The Oko option agreement is subject to the following payments to the Owner:

• i. A cash payment of US$50,000 on the date of signing (paid by Ontario Inc.);

• ii. US$100,000 on the first anniversary (paid by Ontario Inc.), US$200,000 on the second anniversary (paid), US$200,000 on the third anniversary (paid) and US$200,000 (paid) on the fourth anniversary.

Once the above payments are made and upon the notification to the Owner of the determination of gold resources greater than 250,000 ounces, the Company can exercise its option and is then subject to a Net Smelter Royalty (NSR) payment of US$1,000,000 to the Owner. After the exercise, the Company will be subject to a 2 ½% NSR on all marketable minerals derived from the properties. The Company can purchase this NSR through a US$5,000,000 cash payment to the owner.

• 19 -

G2 Goldfields Inc. Notes to Consolidated Financial Statements Year Ended May 31, 2022 (Expressed in Canadian Dollars)

9. MINING INTERESTS (CONTINUED)

(b) Guyana Projects, Guyana, South America (continued)

The Jubilee Option Agreement

On November 19, 2019 the Company entered into the Jubilee option agreement. In accordance with the agreement, the Company has the right to acquire a 100% interest in 7 mining permits. The Jubilee option agreement is subject to the following payments to the Owner:

1. A cash payment of US$25,000 on the date of signing (paid);

2. US$50,000 on the first anniversary (paid), US$100,000 on the second anniversary (paid), US$300,000 on the third anniversary.

Once the above payments are made and upon the notification to the Owner of the determination of gold resources greater than 150,000 ounces, the Company can exercise its option. After the exercise, the Company will be subject to a 2% NSR on all marketable minerals derived from the properties. The Company can purchase this NSR through a US$2,000,000 cash payment to the owner.

The Ghanie Option Agreement

On February 25, 2020 the Company entered into the Ghanie option agreement. In accordance with the agreement, the Company has the right to acquire a 100% interest in 4 mining permits. The Ghanie option agreement is subject to the following payments to the Owner:

1. A cash payment of US$15,000 on the date of signing (paid);

2. US$25,000 on the first anniversary (paid), US$100,000 on the second anniversary (paid), US$75,000 on the third anniversary and US$100,000 on the fourth anniversary.

Once the above payments are made and upon the notification to the Owner of the determination of gold resources greater than 150,000 ounces, the Company can exercise its option. After the exercise, the Company will be subject to a 2% NSR on all marketable minerals derived from the properties. The Company can purchase this NSR through a US$2,000,000 cash payment to the owner.

Amsterdam properties

G2 also indirectly entered into an option agreement on November 19, 2021 in respect of the “Amsterdam properties”. In respect to the option agreement on the “Amsterdam properties", the equivalent of US$100,000 was paid upon signing and a 100% interest in such properties may be acquired by making additional payments totaling US$1,075,000 based on the payment terms set out below and having a mineral resource of more than 150,000 ounces of gold in accordance with National Instrument 43-101 standards. The vendor retains a 2.5% net smelter royalty, which can be acquired for US$3 million. The option agreement terminates if the option is not exercised before November 19, 2028.

• 20 -

G2 Goldfields Inc. Notes to Consolidated Financial Statements Year Ended May 31, 2022 (Expressed in Canadian Dollars)

9. MINING INTERESTS (CONTINUED)

(b) Guyana Projects, Guyana, South America (continued)

Amsterdam properties (continued)

The payment terms totalling US$1,075,000 are as follows: US$150,000 on the first anniversary, US$225,000 on the second anniversary, US$300,000 on the third anniversary and US$400,000 on the fourth anniversary.

10. SHARE CAPITAL

Authorized share capital

The authorized share capital consisted of an unlimited number of common shares. The common shares do not have a par value. All issued shares are fully paid.

Common shares issued

	Number of		Share
	Shares		Capital
Balance, May 31, 2020	106,653,991	$	45,930,579
RSU's converted	200,000		34,000
Stock options exercised	1,650,000		941,410
Warrants exercised	8,341,230		2,920,192
Spin-out of Sandy Lake Project (note 9(a))	-		(1,265,567)
Common shares issued for private placements	9,711,537		3,772,001
Share issuance costs	-		(318,770)
Balance, May 31, 2021	126,556,758		52,013,845
RSU's converted	100,000		17,000
Stock options exercised	2,620,000		1,467,639
Warrants exercised	5,525,000		2,031,426
Common shares issued for private placements	6,800,000		3,060,000
Warrants issued for private placements	-		(679,662)
Share issue costs	-		(53,581)
Balance May 31, 2022	141,601,758	$	57,856,667

2021 activity

On June 23, 2020, the Company closed its non-brokered private placement (the “Offering”) pursuant to which it has issued an aggregate of 9,615,384 units (“Units”) at a price of $0.52 per Unit to raise aggregate gross proceeds of approximately $5,000,000. Each Unit consists of one common share of the Company (a “Share”) and one-half of one share purchase warrant (each whole such share purchase warrant, a “Warrant”), with each Warrant exercisable to acquire one additional Share at an exercise price of $1.00 for a period of 18 months from the closing of the Offering. In connection with the Offering, the Company paid a cash costs of $318,770, as well as a $50,000 finder’s fee which was satisfied by the issuance of 96,153 Units. In addition, the Company issued to eligible registrants an aggregate of 517,366 broker warrants (“Broker Warrants”). Each Broker Warrant is exercisable to acquire one Unit at an exercise price of $0.52 for a period of 18 months from the closing of the Offering. The warrants were valued at $1,083,467 and broker warrants were valued at $144,532.

• 21 -

G2 Goldfields Inc. Notes to Consolidated Financial Statements Year Ended May 31, 2022 (Expressed in Canadian Dollars)

10. SHARE CAPITAL (CONTINUED)

2021 activity (continued)

The fair value of the warrants and broker warrants was estimated using the Black-Scholes option pricing model with the following assumptions: share price of $1.04 for warrants and unit price of $0.52 for broker warrants; expected dividend yield of 0%; risk-free interest rate of 0.27%; volatility of 119.66% and an expected life of 1.5 years.

During the year ended May 31, 2021, 8,341,230 warrants with an exercise price between $0.20 and $0.40 were exercised for gross proceeds of $2,359,819. The fair value of the warrants exercised was $560,373 which was reallocated from warrants to share capital.

During the year ended May 31, 2021, 1,650,000 stock options with an exercise price between $0.18 and $0.40 were exercised for gross proceeds of $551,250. The fair value of the warrants exercised was $390,160 which was reallocated from contributed surplus to share capital.

During the year ended May 31, 2021, 200,000 RSU's were vested and the corresponding 200,000 common shares were issued from treasury. The fair value of the RSU's exercised was $34,000 which was reallocated from contributed surplus to share capital.

2022 activity

On January 6, 2022, G2 announced that it had closed the first tranche (the “First Tranche”) of its non-brokered private placement (the “Private Placement”). In connection with the closing of the First Tranche, the Company sold 2,250,000 units of the Company (the “Units”) at a price of $0.45 per Unit, for gross proceeds of $1,012,500. Each Unit consisted of one common share (“Security”) of the Company and one common share purchase warrant (“Purchase Warrant”). Each Purchase Warrant entitles the holder, on exercise, to purchase one Security for a period of two years following the closing date of First Tranche at an exercise price of $1.20 per Security. The entire First Tranche was purchased by the Executive Chairman, Patrick Sheridan. The Purchase Warrants were valued at $223,637.

The fair value of the Purchase Warrants was estimated using the Black-Scholes option pricing model with the following assumptions: share price of $0.435 for Purchased Warrants; expected dividend yield of 0%; risk-free interest rate of 1.07%; volatility of 99.27% and an expected life of 2.0 years.

On January 28, 2022, G2 announced that it has closed the second and final tranche (the “Second Tranche”) of its Private Placement. In connection with the closing of the Second Tranche of the Private Placement, the Company sold 4,550,000 Units at a price of $0.45 per Unit, for gross proceeds of $2,047,500. As a result, the Company sold a total of 6,800,000 Units pursuant to the Private Placement (including the First Tranche, which closed on January 6, 2022), for gross proceeds of $3,060,000. Each Unit consisted of one Security of the Company and one Purchase Warrant. Each Purchase Warrant entitles the holder, on exercise, to purchase one Security for a period of two years following the closing date of Second Tranche at an exercise price of $1.20 per Security. The Purchase Warrants were valued at $456,025.

The fair value of the Purchase Warrants was estimated using the Black-Scholes option pricing model with the following assumptions: share price of $0.44 for Purchased Warrants; expected dividend yield of 0%; risk-free interest rate of 1.25%; volatility of 99.24% and an expected life of 2.0 years.

• 22 -

G2 Goldfields Inc. Notes to Consolidated Financial Statements Year Ended May 31, 2022 (Expressed in Canadian Dollars)

10. SHARE CAPITAL (CONTINUED)

2022 activity (continued)

In connection with the Second Tranche, (i) an entity controlled by Dan Noone, G2's Chief Executive Officer, entered into a subscription agreement pursuant to which that entity purchased 385,000 Units for an aggregate subscription price of $173,250, and (ii) a director of G2, Stephen Stow, entered into a subscription agreement pursuant to which he purchased 225,000 Units for an aggregate subscription price of $101,250.

During the year ended May 31, 2022, 5,525,000 warrants with an exercise price between $0.20 and $0.35 were exercised for gross proceeds of $1,581,249. The fair value of the warrants exercised was $450,177 which was reallocated from warrants to share capital.

During the year ended May 31, 2022, 2,620,000 stock options with an exercise price between $0.21 and $0.40 were exercised for gross proceeds of $892,000. The fair value of the stock options exercised was $575,639 which was reallocated from contributed surplus to share capital.

During the year ended May 31, 2022, 100,000 RSUs were vested and the corresponding 100,000 common shares were issued from treasury. The fair value of the RSUs exercised was $17,000 which was reallocated from contributed surplus to share capital.

11. WARRANTS

				Weighted Average	Weighted Average
			Number of		Exercise
			Warrants		Price
Balance,	May 31, 2020		17,487,730	$	0.31
Issued			5,373,134		0.95
Exercised			(8,341,230)		0.28
Expired			(3,609,000)		0.40
Balance,	May 31, 2021		10,910,634		0.59
Expired			(5,385,634)		0.91
Exercised			(5,525,000)		0.29
Issued			6,800,000		1.20
Balance	May 31, 2022		6,800,000	$	1.20
					Number of
		Exercise	Black Scholes /		Warrants
	Expiry Date	Price ($)	Fair Value ($)	Outstanding
	January 6, 2024	1.200	223,637		2,250,000
	January 28, 2024	1.200	456,025		4,550,000
			679,662		6,800,000

• 23 -

G2 Goldfields Inc. Notes to Consolidated Financial Statements Year Ended May 31, 2022 (Expressed in Canadian Dollars)

12. STOCK OPTIONS

The Company has a formal stock option plan (the "Plan"). The number of shares reserved for issuance to any one insider, within a one-year period, pursuant to options must not exceed 5% of the outstanding issue. The number of shares reserved for issuance to insiders, within a one-year period, pursuant to options must not exceed 10% of the outstanding issue. The option price of the shares shall be fixed by the Board of Directors but must not be less than the closing sale price of the shares on the TSX-V on the day immediately preceding grant.

The Company issued stock options to acquire common shares as follows:

	Number of	Weighted Average
	Stock options	Exercise Price ($)
Balance, May 31, 2020	7,725,000	0.34
Issued (i)(ii)(iii)(iv)	2,350,000	0.62
Forfeited	(175,000)	0.40
Exercised (note 10)	(1,650,000)	0.33
Balance, May 31, 2021	8,250,000	0.42
Issued (v)(vi)(vii)(viii)(ix)(x)(xi)	1,650,000	0.59
Expired	(1,256,250)	0.33
Forfeited	(93,750)	0.54
Exercised (note 10)	(2,620,000)	0.34
Balance, May 31, 2022	5,930,000	0.51

(i) On August 13, 2020 the Company granted 1,000,000 stock options with an exercise price of $0.75 per share to two officers of the Company. The options expire on August 13, 2023 and vesting 25% immediately and 25% after each of 6, 12 and 18 months after date of grant. The fair value of these options was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions: share price of $0.73; expected dividend yield of 0%; risk- free interest rate of 0.32%; volatility of 126% and an expected life of 3 years. The fair value assigned to these options was $526,352.

(ii) On November 19, 2020, the Company granted an aggregate of 1,150,000 options to a director and consultants of the Company with such options being exercisable at a price of $0.52 per share until November 19, 2023 and vesting as to one-quarter immediately and one-quarter after 6, 12 and 18 months respectively from the date of grant. The fair value of these options was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions: share price of $0.48; expected dividend yield of 0%; risk- free interest rate of 0.30%; volatility of 120% and an expected life of 3 years. The fair value assigned to these options was $380,425.

(iii) On December 8, 2020, the Company granted an aggregate of 125,000 options to a consultant of the Company with such options being exercisable at a price of $0.52 per share until December 8, 2023 and vesting as to one-quarter immediately and one-quarter after 6, 12 and 18 months respectively from the date of grant. The fair value of these options was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions: share price of $0.49; expected dividend yield of 0%; risk- free interest rate of 0.32%; volatility of 120% and an expected life of 3 years. The fair value assigned to these options was $42,410.

(iv) On March 18, 2021, the Company granted an aggregate of 75,000 options to a consultant of the Company with such options being exercisable at a price of $0.50 per share until March 18, 2024 and vesting as to one-quarter immediately and one-quarter after 6, 12 and 18 months respectively from the date of grant. The fair value of these options was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions: share price of $0.40; expected dividend yield of 0%; risk- free interest rate of 0.53%; volatility of 113% and an expected life of 3 years. The fair value assigned to these options was $19,158.

• 24 -

G2 Goldfields Inc. Notes to Consolidated Financial Statements Year Ended May 31, 2022 (Expressed in Canadian Dollars)

12. STOCK OPTIONS (CONTINUED)

(v) On June 25, 2021, the Company granted an aggregate of 50,000 options to an employee of the Company with such options being exercisable at a price of $0.50 per share until June 24, 2024 and vesting as to one-quarter immediately and one-quarter after 6, 12 and 18 months respectively from the date of grant. The fair value of these options was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions: share price of $0.51; expected dividend yield of 0%; risk-free interest rate of 0.63%; volatility of 112% and an expected life of 3.00 years. The fair value assigned to these options was $17,145.

(vi) On July 27, 2021, the Company announced that Carmelo Marrelli has been appointed as the Company’s Chief Financial Officer. Mr. Marrelli will succeed Paul Murphy, who has retired from the position. In connection with his appointment, Mr. Marrelli has been granted 150,000 options of the Company exercisable at a price of $0.50 per share until July 27, 2024 and vesting as to one-quarter immediately and one-quarter after 6, 12 and 18 months respectively from the date of grant. The fair value of these options was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions: share price of $0.49; expected dividend yield of 0%; risk-free interest rate of 0.54%; volatility of 109% and an expected life of 3.00 years. The fair value assigned to these options was $48,147.

(vii) On August 25, 2021, the Company has granted an aggregate of 825,000 options to directors, officers, employees and consultants of the Company, with such options being exercisable at a price of $0.60 per share until August 25, 2024 and vesting as to one-quarter immediately and one-quarter after 6, 12 and 18 months respectively from the date of grant. The fair value of these options was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions: share price of $0.51; expected dividend yield of 0%; risk-free interest rate of 0.57%; volatility of 107% and an expected life of 3.00 years. The fair value assigned to these options was $260,666.

(viii) On December 13, 2021, the Company granted an aggregate of 125,000 options to an employee of the Company with such options being exercisable at a price of $0.50 per share until December 13, 2024 and vesting as to onequarter immediately and one-quarter after 6, 12 and 18 months respectively from the date of grant. The fair value of these options was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions: share price of $0.45; expected dividend yield of 0%; risk-free interest rate of 1.00%; volatility of 101.40% and an expected life of 3.00 years. The fair value assigned to these options was $34,072.

(ix) On March 5, 2022, the Company granted an aggregate of 150,000 options to an employee of the Company with such options being exercisable at a price of $0.54 per share until March 5, 2025 and vesting as to one-quarter immediately and one-quarter after 6, 12 and 18 months respectively from the date of grant. The fair value of these options was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions: share price of $0.54; expected dividend yield of 0%; risk-free interest rate of 1.38%; volatility of 99.16% and an expected life of 3.00 years. The fair value assigned to these options was $50,024.

(x) On March 17, 2022, the Company granted an aggregate of 200,000 options to an employee of the Company with such options being exercisable at a price of $0.60 per share until March 17, 2025 and vesting as to one-quarter immediately and one-quarter after 6, 12 and 18 months respectively from the date of grant. The fair value of these options was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions: share price of $0.60; expected dividend yield of 0%; risk-free interest rate of 1.89%; volatility of 99.18% and an expected life of 3.00 years. The fair value assigned to these options was $74,475.

(xi) On April 28, 2022, the Company granted an aggregate of 150,000 options to an employee of the Company with such options being exercisable at a price of $0.80 per share until April 28, 2025 and vesting as to 50,000 immediately, 50,000 after 6 months and 50,000 after 12 months. The fair value of these options was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions: share price of $0.80; expected dividend yield of 0%; risk-free interest rate of 2.58%; volatility of 98.01% and an expected life of 3.00 years. The fair value assigned to these options was $67,032.

• 25 -

G2 Goldfields Inc. Notes to Consolidated Financial Statements Year Ended May 31, 2022 (Expressed in Canadian Dollars)

12. STOCK OPTIONS (CONTINUED)

The following table reflects the actual stock options issued and outstanding as of May 31, 2022:

		Weighted Average
		Remaining	Number of	Number of
	Exercise	Contractual Life	Options	Options Vested
Expiry Date	Price ($)	(years)	Outstanding	(Exercisable)
August 19, 2022	0.40	0.22	800,000	800,000
October 18, 2022	0.40	0.38	555,000	555,000
March 6, 2023	0.18	0.76	225,000	225,000
March 11, 2023	0.21	0.78	475,000	475,000
August 13, 2023	0.75	1.20	1,000,000	1,000,000
November 19, 2023	0.52	1.47	1,150,000	1,150,000
December 8, 2023	0.52	1.52	125,000	93,750
June 25, 2024	0.50	2.07	50,000	25,000
July 27, 2024	0.50	2.16	150,000	75,000
August 25, 2024	0.60	2.24	775,000	387,500
December 13, 2024	0.50	2.54	125,000	31,250
March 5, 2025	0.54	2.76	150,000	37,500
March 17, 2025	0.60	2.80	200,000	50,000
April 28, 2025	0.80	2.91	150,000	50,000
Total	0.51	1.33	5,930,000	4,955,000

Total share-based compensation recognized in the consolidated statements of loss and comprehensive loss from the vesting of stock options during the year ended May 31, 2022 was $576,397 (2021 - $890,631).

13. LOSS PER SHARE

The calculation of basic and diluted loss per share for the year ended May 31, 2022 was based on the loss attributable to common shares of $2,203,677 (the year ended May 31, 2021 – $12,915,460) and the weighted average number of common shares outstanding of 134,164,100 (year ended May 31, 2021 – 120,706,737). Diluted loss did not include the effect of stock options, RSUs and warrants for the year ended May 31, 2022 and May 31, 2021, as they are antidilutive.

14. SEGMENTED INFORMATION

May 31, 2022		Canada		Guyana
Revenue	$	-	$	346,114
Loss for the year	$	(2,187,743)$		(15,934)
Total assets	$	**1,505,799 **	$	16,390,813
May 31, 2021		Canada		Guyana
Revenue	$	-	$	436,327
(Loss) income for the year	$	(12,878,485)$		(36,975)
Total assets	$	**2,260,797 **	$	11,661,493

• 26 -

G2 Goldfields Inc. Notes to Consolidated Financial Statements Year Ended May 31, 2022 (Expressed in Canadian Dollars)

15. RESTRICTED SHARE UNITS (RSUs)

The Company has a formal restricted share unit plan (the "RSU Plan"). The maximum number of Shares available for issuance from treasury under this Plan shall be the lesser of (i) 7,300,000 Shares; and (ii) such number of Shares, when combined with all other Shares subject to grants made under the Company’s other share compensation arrangements, as is equal to 10% of the aggregate number of Shares issued and outstanding from time to time.

The grant of RSUs under the Plan is subject to a restriction such that (i) the number of Restricted Share Units granted to Insiders of the Company within any one (1) year period, and (ii) the number of Shares reserved for issuance under Restricted Share Units granted to Insiders of the Company at any time, in each case under the Plan when combined with all of the Other Share Compensation Arrangements, shall not exceed 10% of the Company's total issued and outstanding Shares, respectively.

The total number of Restricted Share Units granted to any one individual under the Plan within any one year period shall not exceed 5% of the total number of Shares issued and outstanding at the Grant Date. The maximum number of Restricted Share Units which may be granted to any one Consultant within any one year period must not exceed in the aggregate 2% of the Shares issued and outstanding as at the Grant Date.

Movements in RSU's are summarized below:

			Number of RSUs
Balance, May	31,	2020	300,000
Exercised			(200,000)
Granted			1,100,000
Balance, May	31,	2021	1,200,000
Exercised			(100,000)
Granted			360,000
**Balance, May **	**31, **	2022	1,460,000

On August 13, 2020 the Company issued 1,000,000 RSU’s to two officers of the Company with a maturity date that is 15 months from the grant date. 1/3 of the RSUs vest after each 3, 9 and 15 months after the date of grant. The fair value of the RSU’s granted was $730,000 and were valued based on the fair market value of one common share on the date of issuance.

On November 19, 2020 the Company issued 100,000 RSU’s to a consultant of the Company with a maturity date that is 15 months from the grant date. 1/3 of the RSUs vest after each 3, 9 and 15 months after the date of grant. The fair value of the RSU’s granted was $48,000 and were valued based on the fair market value of one common share on the date of issuance.

On June 25, 2021, the Company issued 60,000 RSUs to employees of the Company with a maturity date that is 15 months from the grant date. 1/3 of the RSUs vest after each 3, 9 and 15 months after the date of grant. The fair value of the RSU’s granted was $30,600 and were valued based on the fair market value of one common share on the date of issuance.

On August 25, 2021, the Company issued 100,000 RSUs to a consultant of the Company with a maturity date that is 15 months from the grant date. 1/3 of the RSUs vest after each 3, 9 and 15 months after the date of grant. The fair value of the RSUs granted was $51,000 and were valued based on the fair market value of one common share on the date of issuance.

• 27 -

G2 Goldfields Inc. Notes to Consolidated Financial Statements Year Ended May 31, 2022 (Expressed in Canadian Dollars)

15. RESTRICTED SHARE UNITS (RSUs) (CONTINUED)

On December 13, 2021, the Company issued 100,000 RSUs to an employee of the Company with a maturity date that is 15 months from the grant date. 1/3 of the RSUs vest after each 3, 9 and 15 months after the date of grant. The fair value of the RSUs granted was $45,000 and were valued based on the fair market value of one common share on the date of issuance.

On March 17, 2022, the Company issued 100,000 RSUs to an employee of the Company with a maturity date that is 15 months from the grant date. 1/3 of the RSUs vest after each 3, 9 and 15 months after the date of grant. The fair value of the RSUs granted was $59,900 and were valued based on the fair market value of one common share on the date of issuance.

As of May 31, 2022, 1,460,000 RSUs were outstanding (May 31, 2021 – 1,200,000) and 1,239,999 RSUs were exercisable (May 31, 2021 – 700,000). Total share-based compensation recognized in the consolidated statement of loss and comprehensive loss from the vesting of RSUs during the year was $236,280 (May 31, 2021 - $707,064).

16. INCOME TAXES

Rate reconciliation

A reconciliation of actual income tax expense and the accounting loss multiplied by the Company’s statutory tax rate of 26.5% (2021 - 26.5%) is as follows:

Years ended May 31,		2022		2021
Loss before income taxes	$	(2,203,677) $		(12,826,988)
Expected income tax recovery based on statutory rate		(583,974)		(3,399,152)
Tax rate change and other adjustments		(14,647)		7,107
Share-based compensation and non-deductible expenses		215,359		473,048
Change in deferred tax asset not recognized		383,262		3,007,469
Tax provision	$	-	$	88,472

Unrecognised Deferred Tax Assets

Deferred taxes are provided as a result of temporary differences that arise due to the differences between the income tax values and the carrying amount of assets and liabilities. Deferred tax assets have not been recognized in respect of the following deductible temporary differences:

Deferred tax assets (liabilities)

Deferred tax assets (liabilities)
Years ended May 31,		2022		2021
Property and equipment	$	69,164	$	69,485
Marketable securities		192,541		189,604
Share issue costs		300,329		363,182
Non-capital losses carried forward - Canada		10,243,895		8,758,890
Non-capital losses carried forward - Guyana		1,465,967		1,450,636
Non-capital losses carried forward - Barbados		7,598		7,598
Resource pods-mining interests		10,366,394		10,366,394
		22,645,888		21,205,789
Less: deferred tax assets not recognized		(22,645,888)		(21,205,789)
Net deferred income tax assets (liabilities)	$	-	$	-

• 28 -

G2 Goldfields Inc. Notes to Consolidated Financial Statements Year Ended May 31, 2022 (Expressed in Canadian Dollars)

16. INCOME TAXES (CONTINUED)

The Canadian non-capital loss carry forwards expire as noted in the table below. Share issue and financing costs will be fully amortized in 2026. The remaining deductible temporary differences may be carried forward indefinitely. Deferred tax assets have not been recognized in respect of these items because it is not probable that future taxable profit will be available against which the group can utilize the benefits therefrom.

Loss Carry Forwards

The Company's Canadian non-capital income tax losses expire as follows:

Year		Amount
2030	$	652,620
2031		612,690
2032		1,177,180
2033		1,016,030
2034		840,390
2035		575,640
2036		140,060
2037		113,820
2038		151,660
2039		782,240
2040		1,197,310
2041		1,499,250
2042		1,485,007
	$	10,243,897

The Company’s Barbados non-capital income tax losses can be carried forward for seven (7) years:

Year		Amount
2027	$	7,150
2028		448
	$	7,598

The Company's Guyana non-capital income tax losses can be carried forward indefinitely: $1,465,967 (2021 - $1,450,636).

• 29 -

G2 Goldfields Inc. Notes to Consolidated Financial Statements Year Ended May 31, 2022 (Expressed in Canadian Dollars)

17. RELATED PARTY TRANSACTIONS

The Company has identified its directors and certain senior officers as its key management personnel. The compensation cost for key management personnel is as follows:

May 31,		2022		2021
Salaries and fees	$	269,660	$	337,395
Stock-based compensation		303,080		1,206,140
	$	572,740	$	1,543,535

At May 31, 2022, accounts payable and accrued liabilities and amounts due to related parties includes $136,415 (May 31, 2021 - $257,110) owing to officers, directors and companies controlled by officers and directors.

As of May 31, 2022, G2 is owed $142,527 (May 31, 2021 - $127,043) from S2, a company with common directors and management with G2, which is unsecured, non-interest bearing, and due on demand. The amount is included in current assets.

Major shareholder

To the knowledge of the directors and senior officers of the Company, as at May 31, 2022, no person or corporation beneficially owns or exercises control or direction over common shares of the Company carrying more than 10% of the voting rights attached to all common shares of the Company other than Patrick Sheridan, who owns 38,144,074 common shares (May 31, 2021 - 35,089,074) or 26.94% (May 31, 2021 - 27.73%) of the outstanding common shares.

18. SUBSEQUENT EVENTS

(a) On August 4, 2022, G2 announced that it has completed the second tranche and final tranche of the non-brokered private placement announced by the Company on June 22, 2022 and later upsized on June 29, 2022 (the “Offering”). The Company raised a total of $13,370,020 pursuant to the Offering. The first tranche of the Offering closed on July 15, 2022 and consisted of 19,733,401 common shares of the Company (the “Shares”) at a price of $0.60 per Share, for gross proceeds of $11,840,041. The second tranche consisted of 2,549,965 Shares at a price of $0.60 per Share, for gross proceeds of $1,529,979.

(b) On September 2, 2022, the Company granted an aggregate of 750,000 options to a consultant of the Company with such options being exercisable at a price of $0.63 per share until September 2, 2025 and vesting as to onequarter immediately and one-quarter after 6, 12 and 18 months respectively from the date of grant.

• 30 -