InZinc Mining Ltd. — Interim / Quarterly Report 2022

Aug 27, 2022

==> picture [348 x 88] intentionally omitted <==

MANAGEMENT’S DISCUSSION AND ANALYSIS

FOR THE SIX MONTHS ENDED JUNE 30, 2022

AUGUST 26, 2022

InZinc Mining Ltd.

Management’s Discussion and Analysis For the six months ended June 30, 2022

Description of Management’s Discussion and Analysis

The purpose of this Management’s Discussion and Analysis (“MD&A”) is to explain management’s point of view regarding the past performance and future outlook of InZinc Mining Ltd. (the “Company”). This report also provides information to improve the reader’s understanding of the condensed interim consolidated financial statements and related notes for the six months ended June 30, 2022 as well as important trends and risks affecting the Company’s financial performance and should therefore be read in conjunction with the audited consolidated financial statements of the Company for the year ended December 31, 2021. Those financial statements are prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board. All amounts in the financial statements and in this MD&A are expressed in Canadian dollars, unless otherwise indicated. The following discussion is dated and current as of August 26, 2022. This MD&A contains forward-looking information and statements which are based on the conclusions of management. The forwardlooking information and statements are only made as of the date of this MD&A.

The Company’s certifying officers, based on their knowledge, having exercised reasonable diligence, are also responsible to ensure that these filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by these filings, and these financial statements together with the other financial information included in these filings. The Board of Directors approves the financial statements and MD&A and ensures that management has discharged its financial responsibilities. The Board’s review is accomplished principally through the Audit Committee, which meets periodically to review all financial reports, prior to filing.

Additional information on the Company is available on SEDAR and at the Company’s website, www.inzincmining.com.

Forward-Looking Statements

Certain disclosures contained in this MD&A may constitute forward-looking information. This is information regarding possible events, conditions or results of operations of the Company that is based upon assumptions about future economic conditions and courses of action which is inherently uncertain. All information other than statements of historical fact may be forward-looking information.

Forward-looking information is subject to a variety of risks and uncertainties which could cause actual events or results to differ from those reflected in the forward-looking statements, including, without limitation, risks and uncertainties relating to the interpretation of drill results and the estimation of mineral resources, the geology, grade and continuity of mineral deposits; the outbreak of an epidemic or a pandemic, including the outbreak of the novel coronavirus (COVID-19), or other health crisis and the related global health emergency affecting workforce health and wellbeing; and the possibility that future exploration and development results will not be consistent with the Company’s expectations. Some other risks and factors which could cause results to differ materially from those expressed in the forward-looking information contained in this MD&A are described under the heading “Risks and Uncertainties”.

Readers are cautioned that any such listings of risks are not, and in fact cannot be, complete. Although the Company has attempted to identify important factors that could cause actual events and results to differ materially from those described in the forward-looking information, there may be other factors that cause events or results to differ from those intended, anticipated or estimated. The Company believes the expectations reflected in the forward-looking information are reasonable but no assurance can be given that these expectations will prove to be correct and readers are cautioned not to place undue reliance on forward-looking information contained in this MD&A.

The forward-looking information contained in this MD&A is provided as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as otherwise required by law. All of the forward-looking information contained in this MD&A is expressly qualified by this cautionary statement.

-1-

InZinc Mining Ltd.

Management’s Discussion and Analysis For the six months ended June 30, 2022

Description of Business

The Company is incorporated under the Canada Business Corporations Act and is listed on the TSX Venture Exchange (“TSX-V”) under the trading symbol IZN. The principal business of the Company is the acquisition, exploration and development of mineral properties (“exploration and evaluation assets”), either solely or through joint ventures and options.

The Company’s primary focus is the exploration stage Indy property (100% option) (“Indy”) located in central British Columbia. Indy is well located for potential development with proximal access to power, roads and rail infrastructure. The property consists of approximately 19,900 hectares covering a 29 km strike of Cambrian to Mississippian aged strata with district scale discovery potential for Sedimentary Exhalative (“Sedex”) type base and precious metal deposits.

In addition to exploring Indy, the Company is engaged in a continuing review of other properties and projects for possible acquisition.

The Company has an investment in the common shares of American West Metals Limited (“American West”) (listed on the Australian Securities Exchange), which is advancing multiple North American base metals projects including the West Desert zinc project located in Utah. The Company will also receive 50% of the revenue, on a net smelter returns royalty (“NSR”) basis, from the sale of indium mined from West Desert subject to American West’s right to reduce this NSR interest to 25% by paying the Company USD $5,000,000 in cash at any time prior to the first sale of indium from the project.

To date the Company has not generated any revenues. Indy is at the exploration stage and has not generated any revenues. At June 30, 2022, the Company had not yet achieved profitable operations and has a deficit of $13,868,202 (December 31, 2021 - $13,628,163).

Since Indy is at the exploration stage, it does not have operations or operating results in the conventional use of the terms. The Company’s financial success will ultimately be dependent upon finding economically recoverable mineral reserves, confirmation of its interest in those reserves and its ability to obtain the necessary financing to profitably produce those reserves. Further information on the Company’s properties can be found on the Company’s website at www.inzincmining.com.

Mineral Properties

Indy

Indy is located approximately 90 km southeast of the city of Prince George, in central British Columbia. The property is 85 km south of the CNR transcontinental railway and 65 km south of the Yellowhead highway at moderate elevations ranging from 950 m to 1300 m. The property is accessed by well-maintained Forest Service roads.

Indy covers a 29 km trend (19,900 hectares) of Cambrian to Mississippian aged rocks with district scale discovery potential for Sedex type base and precious metal deposits. An initial drill program completed by the Company in 2018 discovered near surface, high grade Sedex-style zinc mineralization at one of four large areas of strongly anomalous soil geochemistry on the project. Extensive soil geochemical programs in 2019 and 2021 outlined an additional 10 km of high-quality, base and precious metal targets at Indy.

-2-

InZinc Mining Ltd.

Management’s Discussion and Analysis For the six months ended June 30, 2022

Mineral Properties (cont’d…)

Indy (cont’d…)

2022 Exploration Programs

On April 21, 2022, the Company announced 2022 drill plans for zinc and silver-gold targets at Indy, including a 2,500 m diamond drilling contract. Drill plans include provisions for 20 to 25 drill holes focusing on targets occurring along the 7 km Main Trend and supported by an extensive network of existing roads. The 2022 program, including airborne geophysics, is fully funded.

On June 28, 2022, the Company announced the mobilization of exploration crews and equipment to commence an 1,100 line km program of airborne geophysics and an extension of an access trail to support ground based drilling. The Echo South, Keel, Fox East and B-9 targets are prioritized for exploration drilling in 2022. The Fox West, Hat and Anomaly G precious metal targets will be prepared for drilling in subsequent programs. The northern 900 m extension of the Echo target (Echo North), Delta Horizon and Anomaly C will also be planned as future drill targets.

On August 3, 2022, the Company announced completion of an 1,100 line km airborne geophysical survey and progress of the 2022 drill program including completion of five drill holes (to date) at the Fox East silver-gold target and the Keel zinc +/- silver target.

Exploration activities are permitted and monitored under a Multi-Year Access Bond with the Government of British Columbia. Exploration expenditures are eligible for the BC Mineral Exploration Tax Credit (“BCMETC”). The Company has received $319,284 from BCMETC claims for 2017 – 2020.

2022 Expenditure Requirements

Under the terms of the Indy option agreement, additional property expenditures of $400,000 are required on or before January 29, 2022. These requirements have been met.

Previous Exploration (2017 – 2021)

In 2017, the Company completed initial soil geochemical surveys, geological mapping and prospecting in the Anomaly B and C areas.

Additional geochemical surveys were completed in mid-August 2018, prior to an initial diamond drill program (1,270 m in eleven drill holes) which was completed in September 2018. In November 2018, the Company announced the discovery of shallow, high grade zinc sulphide mineralization in drill hole IB18-009 at the B-9 Zone located in the southern portion of Anomaly B. Significant drill intersections from the 2018 drill program include:

B-9 Zone 2018 Drilling – Selected Highlights

• 12.33% Zn, 2.98% Pb, 24.46 g/t Ag over 6.29 m at 60 m below surface in hole IB18-009

• 5.76% Zn, 0.48% Pb, 3.41 g/t Ag over 6.73 m at 56 m below surface in hole IB18-008

• 4.49% Zn, 1.13% Pb, 7.32 g/t Ag over 4.28 m at 27 m below surface and

• • 2.24% Zn, 0.83% Pb, 5.23 g/t Ag over 5.38 m at 33 m below surface and • 3.50% Zn, 0.66% Pb, 4.59 g/t Ag over 4.57 m at 37 m below surface in Hole IB18-002

• 9.26% Zn, 2.43% Pb, 17.98 g/t Ag over 3.05 m at 23 m below surface in hole IB18-003*

• 3.88% Zn, 1.34% Pb, 8.90 g/t Ag over 3.99 m at 29 m below surface in hole IB18-006

Note: Drilled intersections are apparent width only. The intersections in IB18-002 are separated by lost core/no recovery. *Low core recoveries.

-3-

InZinc Mining Ltd.

Management’s Discussion and Analysis For the six months ended June 30, 2022

Mineral Properties (cont’d…)

Indy (cont’d…)

In late 2018, the Company increased its claim holdings to encompass an additional zinc-in-soil geochemical anomaly, called the Action anomaly.

From mid-June until late-August 2019, extensive soil geochemical surveys (1,194 soils) to further outline, extend and prioritize the various anomalies were completed. Additional work included mapping and prospecting programs on priority targets. In late September 2019, the Company announced the definition of a large new Sedex-type target called the Delta Horizon located 5 km northwest of the B-9 Zone.

The 2019 program identified the distinctive geochemical signatures commonly associated with Sedex deposits, in several potentially stacked horizons over the 7 km long Main Trend.

The summer 2021 program continued to expand soil geochemical sampling (1,419 samples) in the northeastern portion of the 7 km long Main Trend. Road access to Anomaly B was completed in August 2021 in conjunction with third parties. The coordinated program included a semi-permanent bridge span, three stream crossings and significant upgrades to existing roads to allow industrial scale traffic. The Company was responsible for the installation of one of the stream crossings.

In September 2021, the Company announced the discovery of the Echo target – a 1.9 km long, continuous, multielement (Zn, Pb, Ba) soil anomaly located 1 km east of the Delta Horizon target. In addition, two large and discrete areas, named Hat and Fox, containing soils enriched in silver (2 to 24.8 ppm) were discovered in the area between the Delta and Echo targets.

A follow-up program in October 2021 focused on additional soil sampling in the Anomaly B area, minor sub-crop sampling and establishing drill trail access to the Delta Horizon area.

On February 2, 2022, the Company announced it had increased its mineral claims to encompass 19,900 ha (199 km[2] ) by staking an additional six contiguous mineral claims (7,600 ha). On February 9, 2022, the Company announced the discovery of the Anomaly G silver target, completion of the rehabilitated road access to the Delta Horizon area and plans for a 2022 exploration program with a minimum $1,250,000 budget including proposed drilling. On February 16, 2022, the Company announced the discovery of gold in soils at the Fox silver target and that it had retained the services of an airborne geophysical contractor to provide surveys covering a 28 km length of the project.

After reporting results from the 2021 exploration program, a total of 10 km of high-quality, base and precious metal targets were defined at Indy.

Historical Exploration

Kennco staked the area in 1981 and between 1980 and 1982 located several zinc-lead-silver geochemical anomalies over a 6.5 km trend. Four short diamond drill holes on two selected geochemical targets were completed.

In 1988, Cominco optioned the property from Kennco and completed soil geochemistry programs outlining a fourth anomaly on the property. Five shallow, wide-spaced diamond drill holes were reported by Cominco in 1989 which targeted a portion of a high contrast soil anomaly (Anomaly B). All five holes intersected mineralization at estimated vertical depths less than 100 m over a 450 m long trend. Drill intersections ranged from 1.5 m to 19.7 m, grading from 1.9% to 8.9% zinc, 1.0 g/t to 55.6 g/t silver and 0.04% to 2.4% lead. Locations and true widths of these intersections are not known and in some cases core recoveries were less than 50%.

Cominco returned the property to Kennco post 1991, after which only minor activities are recorded.

-4-

InZinc Mining Ltd.

Management’s Discussion and Analysis For the six months ended June 30, 2022

Mineral Properties (cont’d…)

Indy (cont’d…)

Option Agreement

On October 17, 2016, subsequently amended April 2, 2020, the Company entered into an option agreement to acquire a 100% interest in Indy from Pac Shield Resources Inc. (“PSR”), a private British Columbia company. On January 31, 2023, pursuant to the agreement with PSR, the Company has the option to earn a 100% interest after a five-year period of making staged cash payments totaling $315,000 ($190,000 paid to date), issuing an aggregate of 2,400,000 shares (1,900,000 issued to date) and completing work commitments of $2,600,000 (work commitments, up to and including the fifth year work, totalling $1,350,000 have been completed). In addition, a $500,000 cash payment and the issuance of 500,000 shares of the Company will be made to PSR if the Company files a technical report establishing a 500,000,000 pound zinc resource on the property. A further $500,000 cash payment will be made to PSR should the Company file a technical report establishing a 750,000,000 pound zinc resource on the property. The property is subject to a 1.0% NSR held by PSR (the “PSR NSR”) and a 1.5% NSR held by Kerry Curtis, a director, Chairman of the Board and former interim Chief Executive Officer of the Company, and a director and the controlling shareholder of PSR. On exercise of the option and prior to completion of a feasibility study on the property, the Company has the right to purchase the PSR NSR for $1,500,000.

Summary of Exploration and Evaluation Assets and Activities

Exploration and evaluation asset summary

Exploration and evaluation asset acquisition costs for the six months ended June 30, 2022 are as follows:

		Indy		Total
Balance, December 31, 2021	$	273,345	$	273,345
Additions during the year:
Cash payments		50,000		50,000
Shares issued		22,000		22,000
Staking		13,315		13,315
		85,315		85,315
Total, June 30, 2022	$	358,660	$	358,660

-5-

InZinc Mining Ltd.

Management’s Discussion and Analysis For the six months ended June 30, 2022

Summary of Exploration and Evaluation Assets and Activities (cont’d…)

Exploration and evaluation expenditures (cont’d…)

Exploration and evaluation expenditures for the six months ended June 30, 2022 are as follows:

		Indy		Total
Communication	$	808	$	808
Drilling		23,305		23,305
Equipment and supplies		25,116		25,116
Geochemistry		6,600		6,600
Geophysics		205,189		205,189
Personnel		43,300		43,300
Room and board		6,966		6,966
Total, June 30, 2022	$	311,284	$	311,284

Cumulative exploration and evaluation expenditures from acquisition on October 17, 2016 to June 30, 2022 are as follows:

		Indy		Total
Air support	$	106,575	$	106,575
Analytical		68,476		68,476
Claims maintenance		4,080		4,080
Communication		6,658		6,858
Community engagement		750		750
Drilling		503,126		503,126
Engineering		14,035		14,035
Environmental		596		596
Equipment and supplies		161,187		161,187
Geochemistry		16,112		16,112
Geophysics		205,189		205,189
Permitting		3,319		3,319
Personnel		467,566		467,566
Room and board		104,326		104,326
Travel		13,653		13,653
		1,675,648		1,675,648
BC mineral exploration tax credit		(319,284)		(319,284)
Total, June 30, 2022	$	1,356,364	$	1,356,364

-6-

InZinc Mining Ltd.

Management’s Discussion and Analysis For the six months ended June 30, 2022

Selected Quarterly Information

Quarter Ended	Revenue	Net income (loss) and comprehensive income (loss)	Net income (loss) per share
June 30,2022	$ nil	$ (691,655)	$ (0.01)
March 31,2022	$ nil	$ 403,210	$ 0.00
December 31,2021	$ nil	$ 3,442,396	$ 0.03
September 30,2021	$ nil	$ (98,659)	$ (0.00)
June 30,2021	$ nil	$ (41,270)	$ (0.00)
March 31,2021	$ nil	$ (29,292)	$ (0.00)
December 31,2020	$ nil	$ 15,723	$ 0.00
September 30,2020	$ nil	$ (129,826)	$ (0.00)

The loss and comprehensive loss for the Company varies from quarter to quarter, depending mainly on the amount of exploration activities, communication and investor relations activities, professional fees, and whether stock options were granted.

Results of Operations: Year-to-date

The loss and comprehensive loss for the six months ended June 30, 2022 was $(288,445) or $(0.00) per share compared with a loss and comprehensive loss of $(70,562) or $(0.00) per share during the same quarter of 2021. The following discussion should be read in conjunction with the accompanying financial statements and related notes for the period.

The table below explains the significant changes in expenditures for the six months ended June 30, 2022 compared with June 30, 2021.

Expense	Change in Expense	Explanation for Change
Communication and investor relations	Increase of $13,010	The increase is due to increased activity in the Company. There were more frequent news releases than in the prior period and additional work was performed as the Company updated its website. Additional costs were also incurred on corporate activities.
Exploration and evaluation expenditures	Increase of $294,631	The increase is due to increased exploration planning activities and airborne geophysical surveys at Indy. The Company is utilizing the funds from the sale of West Desert.
Share-based compensation	Increase of $63,983	There were more incentive share options granted and vested during the current period as compared to the prior period.
Unrealized gain on marketable securities	Increase of $263,520	The American West shares were adjusted to their fair value at period end. This is determined based on market price, adjusted for a discount to reflect the hold period on the shares.

-7-

InZinc Mining Ltd.

Management’s Discussion and Analysis For the six months ended June 30, 2022

Results of Operations: Quarter

The loss and comprehensive loss for the three months ended June 30, 2022 was $(691,655) or $(0.01) per share compared with a loss and comprehensive loss of $(41,270) or $(0.00) per share during the same quarter of 2021. The following discussion should be read in conjunction with the accompanying financial statements and related notes for the period.

The table below explains the significant changes, not previously detailed (refer to “Results of Operations: Year-todate” above), in expenditures for the three months ended June 30, 2022 compared with June 30, 2021.

Expense	Change in Expense	Explanation for Change
Professional fees	Decrease of $102,142	The decrease resulted from lower legal fees incurred on the option agreement with American West compared to the prior period. Although additional legal fees were incurred subsequent to the closing of the transaction, the prior period was when the significant work was done.

Liquidity, Financial Position and Capital Resources

The Company’s liquidity and capital resources are as follows:

	June 30, 2022	December 31, 2021
Cash $ 2,771,907 $ 3,165,251 Receivables 20,799 36,976 Prepaids and advances 72,996 19,142 Marketable securities 1,374,166 1,110,646
Total current assets $ 4,239,868 $ 4,332,015
Accounts payable and accrued liabilities $ 177,345 $ 74,155
Total current liabilities $ 177,345 $ 74,155
Working capital $ 4,062,523 $ 4,257,860

The Company had a net working capital position of $4,062,523 at June 30, 2022 compared with $4,257,860 as at December 31, 2021.

The Company had cash on hand of $2,771,907 on June 30, 2022 (December 31, 2021 - $3,165,251). The source of cash consists of receipt of payments from American West, funds raised in previous financings, along with proceeds from the BCMETC, less cumulative expenditures incurred. The primary use of cash during the six months ended June 30, 2022 was the funding of operations of $347,529 (2021 - $82,986). The increase is mainly for work on Indy. The acquisition of exploration and evaluation assets of $63,315 (2021 - $35,000) consisted of additional claims acquired via staking (none in prior period) and the annual cash payment required on Indy. The prior period also had funds received of $602,430 from American West. There was $12,500 received from options exercised and $5,000 received for shares to be issued during the six months ended June 30, 2022, as compared to one financing during the six months ended June 30, 2021, which raised net proceeds of $198,250.

-8-

InZinc Mining Ltd.

Management’s Discussion and Analysis For the six months ended June 30, 2022

Liquidity, Financial Position and Capital Resources (cont’d…)

The Company’s general and administrative costs, exclusive of any management compensation or direct business costs such as acquisitions, exploration field work or travel, are in the range of $180,000 annually. These maintenance costs are typical for a public company of this nature and consist of stock exchange fees, legal fees, accounting and audit fees, transfer agent fees and general office expenses such as rent, insurance, basic administrative assistance and phone. As the Company has commenced further exploration of its properties, it may have an impact on general and administrative costs.

The Company has no known mineral reserves and is not in commercial production on any of its properties and accordingly, the Company does not generate cash from operations. The Company finances exploration activities by raising capital from equity markets from time to time.

Related Party Transactions

The Company entered into the following transactions with related parties during the six months ended June 30, 2022:

Summary of key management personnel compensation:

	For the six months ended June 30, 2022	For the six months ended June 30, 2021
Professional fees (Steve Vanry) $ 1,000 $ 11,000 Professional fees (Lesia Burianyk) 17,500 - Share-based compensation (John Murphy) 21,095 13,717 Share-based compensation (Kerry Curtis) 19,689 12,802 Share-based compensation (Louis Montpellier) 19,689 12,802 Share-based compensation (Wayne Hubert) 19,689 10,973 Share-based compensation (Steve Vanry) 24,526 5,771 Share-based compensation (Lesia Burianyk) 13,720 -
$ 136,908 $ 67,065

Included in accounts payable and accrued liabilities are amounts owing to related parties of $7,350 (December 31, 2021 - $1,252).

Proposed Transactions

There are no proposed transactions to be reported.

-9-

InZinc Mining Ltd.

Management’s Discussion and Analysis For the six months ended June 30, 2022

Risks and Uncertainties

The business and operations of the Company are subject to numerous risks, many of which are beyond the Company’s control. If any of these risks materialize into actual events or circumstances or other possible additional risks and uncertainties of which the Company is currently unaware or which it considers to be material in relation to the Company’s business actually occur, the Company’s assets, liabilities, financial condition, results of operations (including future results of operations), business and business prospects, are likely to be materially and adversely affected. In such circumstances, the price of the Company’s securities could decline and investors may lose all or part of their investment. For a discussion of risks and uncertainties which are the most applicable to the Company, please refer to the Company’s audited consolidated financial statements and related notes thereto and the annual MD&A for the year ended December 31, 2021. These documents are available for viewing at the Company’s website at www.orocoresourcecorp.com or on the Company’s profile at www.sedar.com.

Critical Accounting Estimates

The preparation of the condensed interim consolidated financial statements in conformity with IFRS requires management to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities at the date of the condensed interim consolidated financial statements and the reported expenses during the period.

Although management uses historical experience and its best knowledge of the amount, events or actions to form the basis for judgments and estimates, actual results may differ from these estimates.

Estimates are made when applying accounting policies. The critical estimates that have the most significant effects on the amounts recognized in the condensed interim consolidated financial statements are as follows:

Economic recoverability and probability of future economic benefits of exploration and evaluation assets

Management has determined that exploration, evaluation, and related costs incurred which were capitalized may have future economic benefits and may be economically recoverable. Management uses several criteria in its assessments of economic recoverability and probability of future economic benefits including, geologic and other technical information, a history of conversion of mineral deposits with similar characteristics to its own properties to proven and probable mineral reserves, the quality and capacity of existing infrastructure facilities, evaluation of permitting and environmental issues and local support for the project.

Valuation of share-based compensation

The Company uses the Black-Scholes Option Pricing Model for valuation of share-based compensation. Option pricing models require the input of subjective assumptions including expected price volatility, interest rate, and forfeiture rate. Changes in the input assumptions can materially affect the fair value estimate and the Company’s earnings and equity reserves.

Marketable securities

The Company’s marketable securities have a hold period of one year (from issue) and cannot be actively traded. Accordingly, as part of the valuation a discount is applied based on a valuation model to account for the lack of marketability. The model requires the input of subjective assumptions including expected price volatility. Changes in the input assumptions could materially affect the fair value estimate.

New Accounting Policies Adopted

There were no changes in accounting policies, including initial adoption, during the period.

-10-

InZinc Mining Ltd.

Management’s Discussion and Analysis For the six months ended June 30, 2022

Off-Balance Sheet Arrangements

The Company does not have any off-balance sheet arrangements.

Financial Instruments and Risk Management

Financial instruments measured at fair value are classified into one of three levels in the fair value hierarchy according to the relative reliability of the inputs used to estimate the fair values. The three levels of the fair value hierarchy are:

• Level 1 - Unadjusted quoted prices in active markets for identical assets or liabilities;

• Level 2 - Inputs other than quoted prices that are observable for the asset or liability either directly or indirectly; and

• Level 3 - Inputs that are not based on observable market data.

The fair value of cash, receivables, reclamation deposits, and accounts payable and accrued liabilities approximates their carrying values. Marketable securities are measured at fair value using level 2 inputs with valuation assumptions as described in Note 6 of the condensed interim consolidated financial statements.

Financial risk factors

The Company is exposed to a variety of financial risks by virtue of its activities including credit, liquidity, interest rate, foreign currency, and price risk.

Credit risk

The Company is exposed to industry credit risks arising from its cash holdings and receivables. The Company manages credit risk by placing cash with major Canadian financial institutions. The Company’s receivables are due from the Federal Government of Canada. Management believes that credit risk related to these amounts is nominal.

Liquidity risk

Liquidity risk is the risk that the Company will not have sufficient funds to meet its financial obligations when they are due. To manage liquidity risk, the Company reviews additional sources of capital and financing to continue its operations and discharge its commitments as they become due. The Company has sufficient cash as at June 30, 2022 to settle its current liabilities as they come due.

Interest rate risk

Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company is not exposed to interest rate risk as it does not have any significant financial instruments with interest rates, with the exception of cash. Interest earned on cash is based on prevailing bank account interest rates, which may fluctuate. A 1% change in interest rates would result in a nominal difference for the six months ended June 30, 2022.

Foreign currency risk

The Company is exposed to foreign currency risk on fluctuations related to cash and accounts payables and accrued liabilities that are denominated in United States Dollars. A 10% change in foreign exchange rates would result in a nominal difference for the six months ended June 30, 2022.

-11-

InZinc Mining Ltd.

Management’s Discussion and Analysis For the six months ended June 30, 2022

Financial Instruments and Risk Management (cont’d…)

Financial risk factors (cont’d…)

Price risk

The Company has limited exposure to price risk with respect to commodity and equity prices. Equity price risk is defined as the potential adverse impact on the Company’s earnings due to movements in individual equity prices or general movements in the level of the stock market. Commodity price risk is defined as the potential adverse impact on earnings and economic value due to commodity price movements and volatilities. The Company’s marketable securities are exposed to price risk.

Subsequent Events

Events subsequent to June 30, 2022 have been disclosed elsewhere in this MD&A.

Authorized and Issued Share Capital as at Report Date

Issued and outstanding: 122,802,084 common shares

Options outstanding are as follows:

Number of options	Exercise price	Expiry date
980,000 $ 0.12 October 11, 2022 100,000 $ 0.05 February 4, 2024 2,575,000 $ 0.05 June 11, 2026 300,000 $ 0.06 January 24, 2027 2,425,000 $ 0.06 June 1, 2027
Total 6,380,000

Warrants outstanding are as follows:

Number of warrants	Exercise price	Expiry date
3,333,331 $ 0.06 February 18, 2023
Total3,333,331

Approval

The Board of Directors of the Company has approved the disclosure contained in this Management’s Discussion and Analysis. A copy will be provided to anyone who requests it.

On Behalf of the Board of Directors,

August 26, 2022

-12-