GoldQuest Mining Corp. — Interim / Quarterly Report 2023

May 26, 2023

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GOLDQUEST MINING CORP.

CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED MARCH 31, 2023 (UNAUDITED)

NOTICE OF NO AUDITOR REVIEW OF INTERIM FINANCIAL STATEMENTS

Under National Instrument 51-102, Part 4, subsection 4.3(3) (a), if an auditor has not performed a review of the interim financial statements, they must be accompanied by a notice indicating that the financial statements have not been reviewed by an auditor. The Company’s independent auditor has not performed a review of these financial statements in accordance with standards established by the Canadian Institute of Chartered Accountants for a review of interim financial statements by an entity’s auditor.

The accompanying unaudited interim financial statements of GoldQuest Mining Corp. for the three months ended March 31, 2023 have been prepared by the management of the Company and approved by the Company’s Audit Committee and the Company’s Board of Directors.

The accompanying unaudited interim financial statements of the Company have been prepared by and are the responsibility of the Company’s management.

Table of Contents

Condensed Consolidated Interim Statements of Financial Position (unaudited) .......................................4 Condensed Consolidated Interim Statements of Loss and Comprehensive Loss (unaudited) .....................5 Condensed Consolidated Interim Statements of Changes in Shareholders’ Equity (unaudited) .................6 Condensed Consolidated Interim Statements of Cash Flows (unaudited) .................................................7 Notes to the Condensed Consolidated Interim Financial Statements (unaudited) .....................................8 1. Corporate information and continuance of operations ............................................................................. 8 2. Significant accounting standards and basis of preparation ........................................................................ 9 3. Joint operation ............................................................................................................................................ 9 4. Cash and cash equivalents .......................................................................................................................... 9 5. Long-term investments ............................................................................................................................. 10 6. Equipment ................................................................................................................................................. 10 7. Evaluation and exploration assets ............................................................................................................ 11 8. Evaluation and exploration costs .............................................................................................................. 12 9. Accounts payable and accrued liabilities .................................................................................................. 12 10. Share capital .............................................................................................................................................. 13 11. Related party transactions and balances .................................................................................................. 14 12. Commitment ............................................................................................................................................. 14 13. Segmented information ............................................................................................................................ 15 14. Capital management ................................................................................................................................. 15 15. Financial instruments ................................................................................................................................ 16

GoldQuest Mining Corp.

Condensed Consolidated Interim Statements of Financial Position (unaudited) (Expressed in Canadian Dollars)

	As at	March 31,	December 31,
		2023	2022
	Note(s)	$	$
ASSETS
Current assets
Cash and cash equivalents	4	11,005,859	11,796,562
Amounts receivable		78,744	71,456
Prepaid expenses		131,261	127,843
Deposits		23,249	22,077
		11,239,113	12,017,938
Non-current assets
Long-term investments	5	21,000	22,500
Equipment	6	35,470	41,718
Evaluation and exploration assets	7	1	1
		56,471	64,219
TOTAL ASSETS		11,295,584	12,082,157
LIABILITIES
Current liabilities
Accountspayable and accrued liabilities	9,11	209,356	140,719
TOTAL LIABILITIES		209,356	140,719
SHAREHOLDERS' EQUITY
Share capital	10	73,461,074	73,461,074
Stock options reserve	10	2,165,191	2,138,732
Additional paid-in capital	10	18,621,296	18,621,296
Deficit		(83,158,333)	(82,278,164)
Accumulated other comprehensive income(loss)		(3,000)	(1,500)
TOTAL SHAREHOLDERS' EQUITY		11,086,228	11,941,438
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY		11,295,584	12,082,157
Corporate information and continuance of operations	1
Commitments	12
Segmented information	13

These unaudited condensed consolidated interim financial statements were approved for issue by the Board of Directors and signed on its behalf by:

/s/ Luis Santana Director /s/ Florian Siegfried Director

See accompanying notes to these unaudited condensed consolidated interim financial statements.

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

GoldQuest Mining Corp.

Note(s)	For the three months ended
	March 31, March 31, 2023 2022 $ $
Expenses
Consulting fees Depreciation 6 Evaluation and exploration costs 7 Foreign exchange loss General and administrative Investor relations and promotion Management and directors' fees 11 Professional fees Regulatory and filing fees Rent Salaries and wages 11 Share-based payments 10, 11 Travel	6,000 - 6,248 6,079 504,196 92,860 62,597 40,552 63,325 38,558 42,963 22,391 140,686 93,000 27,441 31,812 11,922 10,714 21,362 6,503 67,376 54,370 26,459 133,713 3,802 4,265
	(984,377) (534,817)
Other income
Interest income	104,208 13,695
Net loss	(880,169) (521,122)
Other comprehensive income (loss)
Change in fair value on available-for-sale investments 5	(1,500) 6,000
Total comprehensive loss	(881,669) (515,122)
Basic and diluted loss per share for the period attributable to common shareholders ($ per common share) Weighted average number of common shares outstanding - basic and diluted	(0.00) (0.00) 259,442,384 259,442,384

See accompanying notes to these unaudited condensed consolidated interim financial statements.

GoldQuest Mining Corp

Condensed Consolidated Interim Statements of Changes in Shareholders’ Equity (unaudited) (Expressed in Canadian Dollars)

Share capital Note(s) # $	Stock options reserve Additional paid-in capital Deficit Accumulated other comprehensive income (loss) $ $ $ $	TOTAL $
Balance as of December 31, 2022 259,442,384 73,461,074	2,138,732 18,621,296 (82,278,164) (1,500)	11,941,438
Reclassification of grant-date fair value on expired stock options 10 - -	- - - -	-
Share-based payments 10 - -	26,459 - - -	26,459
Loss and comprehensive loss - -	- - (880,169) (1,500)	(881,669)
Balance as of March 31, 2023 259,442,384 73,461,074	2,165,191 18,621,296 (83,158,333) (3,000)	11,086,228
		14,115,869 133,713 (515,122) 13,734,460
Balance as of December 31, 2021 259,442,384 73,461,074	3,663,448 16,552,713 (79,568,866) 7,500	14,115,869
Share-based payments 10 - -	133,713 - - -	133,713
Loss and comprehensive loss - -	- - (521,122) 6,000	(515,122)
Balance as of March 31, 2022 259,442,384 73,461,074	3,797,161 16,552,713 (80,089,988) 13,500	13,734,460

See accompanying notes to these unaudited condensed consolidated interim financial statements.

Condensed Consolidated Interim Statements of Cash Flows (unaudited) (Expressed in Canadian Dollars)

GoldQuest Mining Corp.

Note(s)	For the three months ended
	March 31, March 31, 2023 2022 $ $
Cash flow from (used in)
OPERATING ACTIVITIES
Net loss Depreciation 6 Share-based payments 10 Net changes in non-cash working capital items: Amounts receivable Prepaid expenses Deposits Accountspayable and accrued liabilities	(880,169) (521,122) 6,248 6,079 26,459 133,713 (7,288) (11,215) (3,418) 6,947 (1,172) (142) 68,637 53,833
Cash flow used in operating activities	(790,703) (331,907)
Decrease in cash and cash equivalents	(790,703) (331,907)
Cash and cash equivalents, beginning ofperiod	11,796,562 14,052,296
Cash and cash equivalents, end ofperiod	11,005,859 13,720,389
Supplemental cash flow information
Cash paid for income taxes Cashpaid for interest	- - - -

See accompanying notes to these unaudited condensed consolidated interim financial statements.

GoldQuest Mining Corp. Notes to the Condensed Consolidated Interim Financial Statements (unaudited) For the Three Months Ended March 31, 2023 (Expressed in Canadian Dollars)

1. CORPORATE INFORMATION AND CONTINUANCE OF OPERATIONS

GoldQuest Mining Corp. (the “Company” or “GoldQuest”) is a publicly listed company incorporated in British Columbia on July 12, 1989 and its shares are listed on the TSX Venture Exchange under the symbol “GQC”. The Company together with its subsidiaries (collectively referred to as the “Company”) is engaged in the identification, acquisition and exploration of mineral properties. The Company’s registered office is located at Suite 2600, 595 Burrard Street, Vancouver, British Columbia, V7X 1L3.

The business of mining and exploring for minerals involves a high degree of risk and there can be no assurance that current exploration programs will result in profitable mining operations. The recoverability of the carrying value of evaluation and exploration properties and the Company's continued existence is dependent upon the preservation of its interest in the underlying properties, the discovery of economically recoverable reserves, the achievement of profitable operations, or the ability of the Company to raise alternative financing, if necessary, or alternatively upon the Company's ability to dispose of its interests on an advantageous basis. Changes in future conditions could require material write-downs of the carrying values. The Company's exploration assets are located outside of Canada and are subject to the risk of foreign investment, including political uncertainty, increases in taxes and royalties, renegotiation of contracts and currency exchange fluctuations.

Although the Company has taken steps to verify title to the properties on which it is conducting exploration and in which it has an interest, in accordance with industry standards for the current stage of exploration of such properties, these procedures do not guarantee the Company’s title. Property title may be subject to unregistered prior agreements, unregistered claims, other land claims and non-compliance with regulatory and environmental requirements.

These unaudited condensed consolidated interim financial statements have been prepared on the assumption that the Company and its subsidiaries will continue as a going concern, meaning it will continue in operation for the foreseeable future and will be able to realize assets and discharge liabilities in the ordinary course of operations. Different bases of measurement may be appropriate if the Company is not expected to continue operations for the foreseeable future. As at March 31, 2023, the Company had not advanced its property to commercial production and is not able to finance day to day activities through operations. The Company’s continuation as a going concern is dependent upon the successful results from its mineral property exploration activities and its ability to attain profitable operations and generate funds there from and/or raise equity capital or borrowings sufficient to meet current and future obligations. Management intends to fund operating costs over the next twelve months with cash and cash equivalents and through further equity financings.

Financial Reporting and Disclosure during Economic Uncertainty

In March 2020, the World Health Organization declared coronavirus COVID-19 a global pandemic; the Company has not been significantly impacted by the spread of COVID-19. However, the ongoing COVID-19 pandemic, inflationary pressures, rising interest rates, the global financial climate and the conflict in Ukraine are affecting current economic conditions and increasing economic uncertainty, which may impact the Company’s operating performance, financial position and the Company’s ability to raise funds at this time.

The unaudited condensed consolidated interim financial statements of GoldQuest for the three months ended March 31, 2023 were approved by the Board of Directors on May 26, 2023.

Page 8 of 19

GoldQuest Mining Corp. Notes to the Condensed Consolidated Interim Financial Statements (unaudited) For the Three Months Ended March 31, 2023 (Expressed in Canadian Dollars)

2. SIGNIFICANT ACCOUNTING STANDARDS AND BASIS OF PREPARATION

Statement of compliance to International Financial Reporting Standards

These unaudited condensed consolidated interim financial statements of the Company have been prepared in accordance with International Financial Reporting Standards (“IFRS”) issued by the International Accounting Standards Board (“IASB”) and interpretations of the International Financial Reporting Interpretations Committee (“IFRIC”). These financial statements comply with International Accounting Standard 34, Interim Financial Reporting.

Basis of presentation

These unaudited condensed consolidated interim financial statements include the accounts of GoldQuest and its subsidiaries. This interim financial report does not include all of the information required of a full annual financial report and is intended to provide users with an update in relation to events and transactions that are significant to an understanding of the changes in financial position and performance of the Company since the end of the last annual reporting period. It is therefore recommended that this financial report be read in conjunction with the annual financial statements of the Company for the year ended December 31, 2022.

New accounting standards

There were no new or amended IFRS pronouncements effective January 1, 2023 that impacted these condensed consolidated interim financial statements.

3. JOINT OPERATION

On January 17, 2020, the Company entered into a joint agreement with Precipitate Gold Corporation that is accounted for as a joint operation under IFRS 11 Joint Arrangements. The purpose of the joint operation was to acquire exploration equipment that can be used by both parties on their respective projects.

The joint operation was made through the incorporation of Toro Negro drilling S.R.L (“Toro Negro”), a company incorporated under the laws of the Dominican Republic on January 30, 2020. The participating interests of both parties at the time of the joint operation is 50% with each party responsible for payment of its proportionate share of operating and capital costs. Upon formation of the joint operation, a management committee (the “Management Committee”) consisting of two representatives of each party and holding voting rights in accordance with each party’s participating interest, was established which shall make all decisions which are required to be made by the joint operation participants.

The Management Committee shall be responsible for managing the exploration equipment acquired.

4. CASH AND CASH EQUIVALENTS

The Company’s cash and cash equivalents are broken down as follows:

	March 31, 2023	December 31, 2022
	$	$
Cash	10,968,965	10,996,997
Cash equivalents	36,894	799,565
	11,005,859	11,796,562

Page 9 of 19

GoldQuest Mining Corp.

Notes to the Condensed Consolidated Interim Financial Statements (unaudited) For the Three Months Ended March 31, 2023 (Expressed in Canadian Dollars)

5. LONG-TERM INVESTMENTS

	Number of shares	Closing market price	Fair value
	#	$	$
As at March 31, 2023
Precipitate Gold Corporation	300,000	0.07000	21,000
			21,000
As at December 31, 2022
Precipitate Gold Corporation	300,000	0.07500	22,500
			22,500

Precipitate Gold Corporation (“Precipitate”)

As at March 31, 2023, the Company recognized $21,000 as the fair value of the 300,000 common shares received from Precipitate (December 31, 2022 – $22,500). The change in fair value of ($1,500) and $6,000 for the three months ended March 31, 2023 and 2022, respectively, is recognized as other comprehensive (loss) income.

6. EQUIPMENT

The Company’s equipment is broken down as follows:

	Computer	Office		Field
	equipment	equipment	Vehicles	equipment	Total
	$	$	$	$	$
COST
As of December 31, 2022	17,406	8,770	21,068	56,837	104,081
As of March 31, 2023	17,406	8,770	21,068	56,837	104,081
ACCUMULATED DEPRECIATION
As of December 31, 2022	(16,369)	(3,390)	(10,531)	(32,073)	(62,363)
Addition	(465)	(175)	(1,316)	(4,292)	(6,248)
As of March 31, 2023	(16,834)	(3,565)	(11,847)	(36,365)	(68,611)
Net book value as of March 31, 2023	572	5,205	9,221	20,472	35,470

Page 10 of 19

GoldQuest Mining Corp. Notes to the Condensed Consolidated Interim Financial Statements (unaudited) For the Three Months Ended March 31, 2023 (Expressed in Canadian Dollars)

7. EVALUATION AND EXPLORATION ASSETS

Dominican Republic – 100% owned

On August 5, 2009, the Company entered into a purchase agreement with Gold Fields Dominican Republic BVI Limited (“GFL”) to acquire its gold-focused portfolio (“Tireo Property”) in the Dominican Republic. As consideration for GFL’s interest in the joint venture projects, the Company issued 8,600,000 common shares and granted a 1.25% Net Smelter Royalty (“NSR”) on the claims in favour of GFL. The transaction was completed on November 18, 2009 with the issuance of the shares at a fair value of $1,247,000.

In October 2015, GoldQuest submitted an Exploitation Application to advance the 100% owned Romero Project in the Dominican Republic. The Company received notification in January 2018 that the Minister of Energy and Mines ("MEM") of the Dominican Republic has approved GoldQuest's Exploitation Permit Application. The Application has been sent to the President for ratification, which is required prior to receiving the final Exploitation Permit. The Exploitation Permit would give the Company the rights to the property for 75 years, with a Tax Stability Agreement that freezes the tax treatment for the project for a minimum of 25 years which is protected under the current Mining Law. After receipt of the Exploitation Permit, the Company will be required to complete an Environment Assessment and receive an Environmental License from the Ministry of Environment prior to the start of construction activities.

The Company received notice that a group of individuals in the Dominican Republic filed a claim against the Company’s wholly owned subsidiary, GoldQuest Dominicana SRL, regarding the Romero project. The Penal Chamber of the First Instance Court of the Judicial District of San Juan de la Maguana reached a decision in late March 2018; however, the only information the Company received regarding the decision is a verbal summary of the decision that was delivered by a Court clerk. The written decision of the court, including the reasons for the decision, was received in early April 2018. Upon review of the written decision by the Company’s outside legal counsel, the decision simply restates the existing legal requirements under present Mining Law 146 and hence has no effect on the operations of the Company or its plans going forward. The injunction is limited to the Exploitation Permit Application for the Romero Concession and does not relate to the Company’s exploration licenses.

During the year ended December 31, 2018, the Company decided to impair the evaluation and exploration assets by $1,246,999 to a nominal amount of $1. The Impairment is based on guidance outlined in IFRS 6, Exploration for and Evaluation of Mineral Resources and IAS 36, Impairment of Assets.

On June 26, 2019, the Ministry of Energy and Mines of the Dominican Republic (“MEM”) granted a new Exploration License to the Company. The Piedra Dura Exploration License is located north of the Romero Project.

As of March 31, 2023, the Company has not received the Exploitation Permit nor clarification from the Dominican Republic’s government on any timeframe for receipt of the Exploitation Permit.

Page 11 of 19

Notes to the Condensed Consolidated Interim Financial Statements (unaudited) For the Three Months Ended March 31, 2023 (Expressed in Canadian Dollars)

GoldQuest Mining Corp.

8. EVALUATION AND EXPLORATION COSTS

The Company’s evaluation and exploration costs during the three months ended March 31, 2023 and 2022 related to projects in the Dominican Republic are broken down as follows:

	March 31, 2023	March 31, 2022
	$	$
Tireo
Access fees	15,844	5,322
Field	80,992	21,663
Field technicians	111,126	54,629
Geological	47,465	1,804
Lodging and food	11,477	6,312
Social responsibility	184,388	223
Transportation	1,684	294
	452,976	90,247
General
Access fees	1,470	695
Field	49,750	1,918
	51,220	2,613
Total evaluation and exploration costs incurred during the
period	504,196	92,860
Cumulative costs, beginning ofperiod	37,141,445	37,141,445
Cumulative costs, end ofperiod	37,645,641	37,234,305

9. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

The Company’s accounts payable and accrued liabilities are broken down as follows:

	March 31, 2023	December 31, 2022
	$	$
Trade payables	174,356	100,719
Accrued liabilities	35,000	40,000
	209,356	140,719

Page 12 of 19

Notes to the Condensed Consolidated Interim Financial Statements (unaudited) For the Three Months Ended March 31, 2023 (Expressed in Canadian Dollars)

GoldQuest Mining Corp.

10. SHARE CAPITAL

Authorized share capital

Unlimited number of common shares without par value.

Issued share capital

At March 31, 2023 and December 31, 2022, the Company had 259,442,384 common shares issued and outstanding with a value of $73,461,074.

During the three months ended March 31, 2023 and 2022, no share capital transactions occurred.

Stock options

Under the Company’s stock option plan, the Board of Directors may grant options for the purchase of up to a total of 10% of the total number of issued and outstanding common shares of the Company. Options granted under the plan may vest over a period of time at the discretion of the board of directors. Under the plan, the exercise price of each option equals the market price of the Company's stock as determined on the date of grant. The options can be granted for a maximum term of 5 years and vest at the discretion of the Board of Directors.

Options to purchase common shares have been granted to directors, employees and consultants at exercise prices determined by reference to the market value of the Company’s common shares on the date of the grant.

No options were granted, exercise or expired during the three months ended March 31, 2023 and 2022.

During the three months ended March 31, 2023 and 2022, the Company recognized share-based payments expense of $26,459 and $133,713, respectively.

The following summarizes information about stock options outstanding and exercisable at March 31, 2023:

					Weighted
					average
					remaining
				Estimated	contractual
	Exercise	Options	Options	grant date fair	life
Expiry date	price($)	outstanding	exercisable	value($)	(inyears)
July 19, 2023	0.25	632,500	632,500	70,332	0.30
January 21, 2024	0.15	4,750,000	4,750,000	308,275	0.81
March 6, 2024	0.15	500,000	500,000	35,947	0.93
April 30, 2025	0.20	3,400,000	3,400,000	255,270	2.08
January 22, 2026	0.36	3,525,000	3,525,000	762,196	2.82
December 17, 2026	0.15	5,495,000	5,495,000	479,300	3.72
June 1, 2027	0.18	2,000,000	1,333,334	252,282	4.17
November 22,2027	0.16	200,000	66,666	23,088	4.65
		20,502,500	19,702,500	2,186,690	2.50
Weighted average exercise price ($)		0.20	0.20

Page 13 of 19

Notes to the Condensed Consolidated Interim Financial Statements (unaudited) For the Three Months Ended March 31, 2023 (Expressed in Canadian Dollars)

GoldQuest Mining Corp.

11. RELATED PARTY TRANSACTIONS AND BALANCES

Related party transactions

The Company’s related parties as defined by IAS 24, Related Party Disclosures, include the Company’s subsidiaries (above), and the following directors, executive officers, key management personnel, and enterprises which are controlled by these individuals:

Related Party	Relationship
Luis Santana	CEO
David Massola	Former CEO
William Fisher	Non-Executive Chairman
Frank Balint	Director
Patrick Michaels	Director
Florian Siegfried	Director
Julio Espaillat	Director
Paul Robertson	CFO
Quantum Advisory Partners LLP	A partnership in which the CFO is a partner
Felix Mercedes	CountryManager,Dominican Republic

The Company considered the executive officers and directors as the key management of the Company.

Total compensation of key company personnel for the three months ended March 31, 2023 and 2022 is as follows:

	For the three months ended
	March 31, 2023 March 31, 2022 $ $
Directors' fees Management remuneration Salaries and wages Share-based compensation	30,000 30,000 110,686 63,000 36,270 33,853 20,735 124,441
	197,691 251,294

During the three months ended March 31, 2023, the Company paid professional fees of $16,500 (March 31, 2022 – $16,500) to Quantum Advisory Partners LLP, a partnership in which the CFO is an incorporated partner, for professional services including accounting, corporate secretarial, transaction support and tax compliance.

Related party balances

The balances due to the Company’s directors and officer included in accounts payables and accrued liabilities were $27,000 as at March 31, 2023 (December 31, 2022 – $9,000). These amounts are unsecured, non-interest bearing and payable on demand.

12. COMMITMENT

The Company is a party to certain management contracts. These contracts contain clauses requiring that approximately $924,000 be paid to certain management personnel upon a change of control of the Company. As the likelihood of these events taking place is not determinable, the contingent payments have not been reflected in these consolidated financial statements.

Page 14 of 19

GoldQuest Mining Corp.

Notes to the Condensed Consolidated Interim Financial Statements (unaudited) For the Three Months Ended March 31, 2023 (Expressed in Canadian Dollars)

13. SEGMENTED INFORMATION

The Company has one reportable segment, being the evaluation and exploration of mineral exploration properties.

The Company’s non-current assets and liabilities are as follows:

March 31, 2023 $	Canada Dominican Republic $ $
Long-term investments 21,000 Equipment 35,470 Evaluation and exploration assets 1	21,000 - 142 35,328 - 1
December 31, 2022 $	142 35,328 $ $
Long-term investments 22,500 Equipment 41,718 Evaluation and exploration assets 1	22,500 - 553 41,165 - 1

14. CAPITAL MANAGEMENT

The Company’s objectives when managing capital are to safeguard its ability to continue as a going concern in order to pursue the evaluation and exploration of its mineral exploration properties and to maintain a flexible capital structure, which optimizes the costs of capital at an acceptable risk. In the management of capital, the Company includes the components of share capital.

There were no changes to the Company policy for capital management during the three months ended March 31, 2023.

The Company manages the capital structure and adjusts it in light of changes in economic conditions and the risk characteristics of the underlying assets. To maintain or adjust its capital structure, the Company may issue new shares, acquire or dispose of assets, or adjust the amount of cash and cash equivalents and short-term investments. In order to maximize ongoing development efforts, the Company does not pay out dividends. The Company and its subsidiaries are not subject to any externally imposed capital requirements.

The Company’s investment policy is to invest its excess cash in very low risk financial instruments such as term deposits or by holding funds in high yield savings accounts with major Canadian banks. By using this strategy, the Company preserves its cash resources and can marginally increase these resources through the yields on these investments. The Company’s financial instruments are exposed to certain financial risks, which include currency risk, credit risk, liquidity risk and interest rate risk.

The Company expects that its current capital resources will be sufficient to fund its present operational commitments and working capital needs for the coming twelve months.

Page 15 of 19

Notes to the Condensed Consolidated Interim Financial Statements (unaudited) For the Three Months Ended March 31, 2023 (Expressed in Canadian Dollars)

GoldQuest Mining Corp.

15. FINANCIAL INSTRUMENTS

Fair value

The carrying values of cash and cash equivalents, amounts receivable, deposits and accounts payable and accrued liabilities approximate their fair values due to the relatively short period to maturity of those financial instruments. Long-term investments are determined by the closing market price of the securities held by the Company.

Financial instruments recorded at fair value on the consolidated statements of financial position are classified using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three levels of the fair value hierarchy are as follows:

Level 1: Unadjusted quoted prices in active markets for identical assets or liabilities; Level 2: 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: Inputs that are not based on observable market data.

As at March 31, 2023 and December 31, 2022, the financial instrument recorded at fair value on the consolidated statement of financial position are cash and cash equivalents and long-term investment which are measured using Level 1 of the fair value hierarchy.

Set out below are the Company’s financial assets and financial liabilities by category:

March 31, 2023 $	FVTPL Amortized costs FVTOCI $ $ $
FINANCIAL ASSETS
ASSETS
Cash and cash equivalents 11,005,859 Amounts receivable 78,744 Deposits 23,249 Long-term investments 21,000	11,005,859 - - - 78,744 - - 23,249 - - - 21,000
FINANCIAL LIABILITIES
LIABILITIES
Accountspayable and accrued liabilities (209,356)	- (209,356) -
December 31, 2022 $	FVTPL Amortized costs FVTOCI $ $ $
FINANCIAL ASSETS
ASSETS
Cash and cash equivalents 11,796,562 Amounts receivable 71,456 Deposits 22,077 Long-term investments 22,500	11,796,562 - - - 71,456 - - 22,077 - - - 22,500
FINANCIAL LIABILITIES
LIABILITIES
Accountspayable and accrued liabilities (140,719)	- (140,719) -

Page 16 of 19

GoldQuest Mining Corp. Notes to the Condensed Consolidated Interim Financial Statements (unaudited) For the Three Months Ended March 31, 2023 (Expressed in Canadian Dollars)

15. FINANCIAL INSTRUMENTS (CONTINUED)

Financial risk management

Credit risk

Credit risk is the risk of an unexpected loss if a third party to a financial instrument fails to meet its contractual obligations. The Company manages its credit risk through its counterparty ratings and credit limits.

The Company’s cash and cash equivalents are primarily held through large Canadian financial institutions. Guaranteed investment certificates are composed of financial instruments issued by Canadian banks and companies with high investment-grade ratings. These instruments mature at various dates over the current operating period and are cashable on the maturity date.

The total cash and cash equivalents and amounts receivable represent the maximum credit exposure. The Company limits its credit risk exposure by holding cash and cash equivalents with reputable financial institutions with high credit ratings. The Company’s amounts receivable balance is not significant and does not represent significant credit exposure as it is principally due from the Government of Canada.

Liquidity risk

Liquidity risk is the risk that an entity will encounter difficulty in raising funds to meet commitments associated with financial instruments. The Company manages liquidity by maintaining adequate cash balances to meet liabilities as they become due.

The Company maintained sufficient cash and cash equivalents at March 31, 2023 in the amount of $11,005,859, in order to meet short-term business requirements. At March 31, 2023, the Company had accounts payable and accrued liabilities of $209,356. All accounts payable and accrued liabilities are current.

Market risk

The significant market risks to which the Company is exposed are interest rate risk, currency risk, other price risk, and commodity price risk.

• Interest rate risk

Interest rate risk is the risk that the fair value or the future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company’s cash and cash equivalents are held mainly in high yield saving accounts and term deposits and therefore there is currently minimal interest rate risk. Because of the short-term nature of these financial instruments, fluctuations in market rates do not have a significant impact on estimated fair values as of March 31, 2023.

The Company’s interest rate risk principally arises from the interest rate impact of interest earned on cash and cash equivalents. A 1% change in interest rates on cash and cash equivalents outstanding as of March 31, 2023 would result in an approximately $110,000 change to the Company’s loss for the three months ended March 31, 2023.

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GoldQuest Mining Corp.

Notes to the Condensed Consolidated Interim Financial Statements (unaudited) For the Three Months Ended March 31, 2023 (Expressed in Canadian Dollars)

15. FINANCIAL INSTRUMENTS (CONTINUED)

Financial risk management (continued)

Market risk (continued)

• Currency risk

The Company is exposed to currency risk to the extent that monetary assets and liabilities held by the Company are not denominated in Canadian dollars. The Company has not entered into any foreign currency contracts to mitigate this risk.

The Company’s cash and cash equivalents, amounts receivable, accounts payable and accrued liabilities and longterm investments are held in Canadian Dollars (“CA$”), US Dollars (“US$”), Dominican Pesos (“RD$” or “DOP”) and Swiss Franc (“CHF”); therefore, USD, DOP and CHF accounts are subject to fluctuation against the Canadian dollar.

The Company had the following balances in foreign currency as at March 31, 2023:

CA$ US$ RD$ CHF	CA$ US$ RD$ CHF
Cash and cash equivalents 10,791,692 5,903 8,402,170 - Amounts receivable 11,765 6,962 2,345,638 - Deposits 4,351 500 742,570 - Long-term investments 21,000 - - - Accounts payable and accrued liabilities (73,915) (4,654) (4,616,961) (10,706)
	10,754,893 8,711 6,873,417 (10,706)
Rate to convert to$1.00 CA$ 1.00 1.35 0.02 1.48
Equivalent to CA$	10,754,893 11,786 168,667 (15,849)

Based on the above net exposures as at March 31, 2023, and assuming that all other variables remain constant, a 10% appreciation or depreciation of the CA$ against the US$, DOP and CHF would increase/decrease comprehensive loss by $16,000.

• Other price risk

Other price risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices other than those arising from interest rate risk, financial market risk, or currency risk.

As of March 31, 2023, the Company held 300,000 common shares of Precipitate which is publicly traded on the TSX Venture Exchange. A 10% change in share price of Precipitate’s shares at March 31, 2023 would result in a $2,100 change to the Company’s comprehensive loss for the three months ended March 31, 2023.

Other than this, the Company is not exposed to significant other price risk.

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GoldQuest Mining Corp.

Notes to the Condensed Consolidated Interim Financial Statements (unaudited) For the Three Months Ended March 31, 2023 (Expressed in Canadian Dollars)

15. FINANCIAL INSTRUMENTS (CONTINUED)

Financial risk management (continued)

Market risk (continued)

• Commodity risk

The Company is exposed to price risk with respect to commodity prices, specifically gold. The Company closely monitors commodity prices to determine the appropriate course of action to be taken by the Company. Commodity prices fluctuate on a daily basis and are affected by numerous factors beyond the Company’s control. The supply and demand for these commodities, the level of interest rates, the rate of inflation, investment decision by large holders of commodities including governmental reserves and stability of exchange rates can all cause significant fluctuations in prices. Such external economic factors are in turn influenced by changes in international investment patterns and monetary systems and political developments. As the Company does not have production assets, management believes this risk is minimal.

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