Management's Discussion and Analysis

FORM 51-102F1

MANAGEMENT DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED DECEMBER 31, 2019

Introduction

This Management Discussion and Analysis ("MD&A") of the results of operations and the financial condition of Meridian Mining SE ("Meridian" or the "Company") is the responsibility of management and covers the year ended December 31, 2019. This MD&A takes into account information available up to and including April, 27 2020 and should be read together with the audited consolidated financial statements and notes for the year ended December 31, 2019, which are available on the SEDAR website at www.sedar.com.

Throughout this document the terms we, us, our, the Company and Meridian refer to Meridian Mining SE. All financial information in this document is prepared in accordance with International Financial Reporting Standards ("IFRS"). All amounts are in United States dollars (USD) unless otherwise stated.

Additional information related to the Company is available for view at www.meridianmining.co or on the SEDAR website at www.sedar.com.

This document contains forward-looking statements. Please refer to "Note Regarding Forward-Looking Statements."

Business Overview

Meridian is a junior exploration and resource development company with a suite of natural resource projects in the State of Rondônia, Brazil. The Company also owns the Espigão manganese project that supplied high quality concentrates to Brazilian and international clients. Due to the collapse in the Mn commodity price, this part of the Company's operations has been put on care & maintenance since December 2019. The Company also has three exploration projects segregated by commodity and location: Espigão - copper ("Cu") - gold ("Au") polymetallic ("Espigão"), Mirante da Serra ("MdS") - manganese ("Mn") and Ariquemes - tin ("Sn"); together ("the Portfolio").

Strategy

Meridian's vision is to create sustainable value for its stakeholders by discovering and developing high quality exploration assets and by leveraging its manganese production capacity to target low cost of production assets. The Company is committed to being a responsible steward of the environment and building collaborative partnerships with communities, governments and all other stakeholders for mutual success.

Throughout 2019, the Company focused its efforts on optimising corporate and operational costs while honoring historical "volume" sales agreements from 2017, renegotiated in 2018 and fulfilled in December 2019. By the start of the 4th Quarter 2019, the Company's Board decided that the long-term growth of the Company was in the exploration of resource development potential of the portfolio, mainly in regards to the Espigão - copper (Cu) - gold (Au) polymetallic project and the Mirante da Serra manganese project. The Ariquemes project will be maintained and the Company will seek a JV partner or a buyer for the project in 2020. The Company could eventually decide to restart its manganese operations in the event that global manganese prices increase to a point where production would be profitable. In December 2019, a material change in direction for the Company was announced to that effect.

Management's Discussion and Analysis

Corporate Outlook

Our priorities are to build on the Espigão - copper (Cu) – gold (Au) polymetallic project and the Mirante da Serra manganese project to accelerate the repositioning of the Company, as well as leveraging the Company’s manganese production capacity if it is profitable to operate when global manganese prices rise again.

Performance Summary for the year ended December 31, 2019

Corporate Highlights

On July 24, 2019 the Company announced the acquisition to acquire the full rights of the MdS Mn project.
On October 15, 2019 the Company announced Mr. John Sabine’s resignation as Non-Executive Chairman and from the Board of Directors of the Company. The Company thanks John for his contribution.
On October 22, 2019 the Company announced that the board of directors has approved the grant of 15,200,000 options at a price of $0.07 per common share for a term of five years, until October 22, 2024.
On December 4, 2019 the Company announced the placing of the Espigão Mn operation on care and maintenance.
During the year ended in 2019 the Company entered into agreements to increase the facility from $1,500,000 to $3,000,000 on January 24, 2019, from $3,000,000 to $4,500,000 on April 18, 2019 from $4,500,000 to $5,200,000 on August 28, 2019 and from $5,200,000 to $6,750,000 on December 04, 2019. The loan bears interest at 10% per annum and is due on March 31, 2020. Please also refer to the Subsequent Events section for a discussion of the standstill and conversion agreements that the Company has negotiated on the debt which will significantly improve the working capital.
On December 30, 2019 the Company completed an internal corporate restructuring which included the dissolution of our Dutch subsidiary Ferrometals BV on December 29, 2019. The benefits of the restructuring will i) simplify and streamline the Company’s corporate structure, ii) generate estimated yearly cash savings of approximately USD 110,000, and iii) simplify the accounting and auditing process.

Operational Highlights

During the fourth quarter of 2019, the Company produced 6,782 tonnes of manganese oxide mineral concentrate (“MnOx”) at an average grade of 51.6% Mn versus 5,163 tonnes during the fourth quarter of 2018, a 31% increase in production over the comparative period.
During the year ended December 31, 2019, the Company produced 29,886 tonnes of MnOx at an average grade of 52.0% Mn versus 37,279 tonnes during the year ended December 31, 2018, a 20% decrease in production over the comparative period.
On December 04, 2019 the Company announced that due to the continued depressed world manganese ore prices, production from the Company’s Espigão do Oeste Manganese operation in Rondônia, Brazil, will be immediately be put on temporary care and maintenance, while continuing to explore value maximizing alternatives.
In response to the COVID-19 virus the Company has taken the recommended preventative precautions according to Brazilian guidelines and continues to monitor the situation. See further discussion in the Risk Factors section.

Management's Discussion and Analysis

Sales Highlights

Manganese ore prices were under pressure from April 2019 due to rising inventories in Chinese ports, low manganese alloy prices and general poor sentiment. The Chinese importers overestimated internal Mn demand while steel producers decided to use their stockpiles. As a result, China's manganese ore port stocks hit an all-time high of 4.45 Mt on May 24 (up 32% Month over Month). By early June, the level dropped to 4.31 Mt, putting additional pressure on Chinese domestic ore prices. These stockpiles were sufficient for 4.5 months consumption which has further deteriorated the supply/demand balance.
Since the start of the 2019 year, the price for +44% Mn concentrates CIF Tianjin (China) has continually declined from USD 7.18 to USD 3.68; a ~48.75% decrease recovering to USD 4.20 by the 4th Quarter's end. Subsequent to the Quarter's end the price recovery continued, partly as a result of supply concerns related to the COVID-19 virus, the Mn price has slowly recovered to USD 5.73.
During the fourth quarter of 2019, the Company sold 11,943 tonnes of manganese oxide product versus 14,052 tonnes during the fourth quarter of 2018. The Company has seen its sales volume decreased by 15% and its revenue decrease by 38% in the fourth quarter due to the drop in global MnOx prices which has diminished the Company's revenues and profit margins.
During the year ended December 31, 2019, the Company sold 28,640 tonnes of manganese oxide product versus 46,851 during the year ended December 31, 2018. For the year ended December 31, 2019 the sales volume decreased by 38.8% and its revenue decrease by 38.7%.
The Company continues to align the domestic sales price for all MnOx concentrates to that received from international clients. During 2019, domestic sales accounted for 16,928 tonnes (59%) and International sales accounted for 11,712 tonnes (41%).

Exploration Highlights

Preproduction and grade control activities were heavily focussed in the Jaburi region, outlining target areas that can support a restart of mining operations upon recovery of manganese prices. One new colluvial field was delineated by hand-auger sampling in the eastern sector of the Jaburi 3 region, extending over 400m in an east-west direction, and 50-150m in a north-south direction. A number of showings identified to the SW of Jaburi Plant remain to be fully evaluated (refer to release referenced under subsequent events, below).
The Company has continued evaluation of the geophysical datasets relating the Espigão Copper-Gold polymetallic project, and initiated a reinspection of select drill core to assess alteration signatures and geological processes. Past exploration has been particularly focussed on the shallow levels of the vein systems. Alteration vectors in conjunction with geophysics will be used to prioritize future targets at depth.

Environmental Highlights

The Company has implemented an improved rehabilitation process whereby rehabilitation is incorporated into the mining sequence. This has provided lower operational costs and a more rapid return of impacted land back to the owners with enhanced land values.
The proactive management of the two plants' settling ponds continues. These ponds contain inert soil fines produced by the washing of the pre-concentrated feed from the plant. Once full they are emptied, and the soils are returned to the farming land as topsoil.
Planned environmental rehabilitation of past mine sites was accelerated during the Quarter. Three past mine sites covering ~40.95 Ha have been rehabilitated and are expected to be returned to the landowner in 2020.

Management's Discussion and Analysis

Subsequent Events

Subsequent to December 31, 2019:

Corporate Highlights

On April 27, 2020, the Company executed the definitive agreements with the Company’s debt holders Sentient Global Resource Fund IV L.P. (“SGRFIV”), Sentient Executive GP IV Limited (“SEGPIV”), collectively with SGRFIV (“Sentient”), as follows:

Debt Conversion Agreement between Meridian and Sentient

$10,500,000 (CAD $14,896,350) will be converted to common shares at a share price of CAD $2.50, subject to the following terms:
Company will need to complete an Equity Raise of CAD $2,500,000 at a subscription price of not less than CAD $0.05 per share;
Equity Raise is required to close by July 30, 2020 (“Closing Date”)
SGRFIV will not dispose any of the shares subscribed under this agreement for a period of 12 months from the Equity Raise Closing Date, subject to certain exceptions
In the event the Company completes a sale transaction within three years for an aggregate amount of at least $50,000,000, Sentient is entitled to a cash payment of up to $17,500,000, subject to reduction in certain situations including the sale of shares by Sentient.

Consolidated Facility Agreement between Meridian and Sentient

Consolidation $10,343,397 (CAD $14,674,177), including principal and interest, into a Consolidated Facility Agreement with a maturity date at March 31, 2022 at 0% interest.
The Company has the option to convert the outstanding amount into common shares of the Company at a fixed conversion price of CAD $2.50 per share at any time after:
the Company has raised in excess of CAD $7,093,500 of equity proceeds since the Closing Date defined in the Debt Conversion Agreement mentioned above; or
the second anniversary of the date of execution of the Debt Conversion Agreement listed above
The Consolidated Facility Agreement will be secured against certain inter-company loans between Meridian and its subsidiary Jaburi and all the shares of Jaburi.

Royalty Purchase and Debt Settlement Agreement and Net Smelter Royalty Agreement between Cancana and Sentient

Conversion of $3,166,027 (CAD $4,491,643) loan into a 2% net smelter returns royalty (“Royalty”) over the following projects:
2% on Espigão polymetallic;
2% Mirante da Serra manganese;
2% Ariquemes tin; and
100% of the royalty on each project can be bought back for $2,000,000 for each project or $6,000,000 for all 3 projects.
Certain conditions and restrictions apply to be followed by Jaburi and Cancana regarding the title maintenance and assignment of the projects contemplated in the Royalty Agreement

The issuance of the common shares, the Debt Conversion Agreement, Consolidated Facility Agreement and Royalty agreements are subject to the approval of the TSX Venture Exchange.

On April 28, 2020, the Company executed the debt restructure agreement with The Sentient Group (“TSG”), as follows:
$1,249,863 (CAD $1,773,181) will be converted to common shares at the same subscription price of the Equity Raise described below. The conversion is subject to the following terms:
Company will need to complete an Equity Raise of CAD $2,500,000 at a subscription price of not less than CAD $0.05 per share;
Equity Raise is required to close by July 30, 2020
Common shares issued will have restricted trading options.

Management's Discussion and Analysis

The issuance of the common shares is subject to the approval of the TSX Venture Exchange.

On April 13, 2020, the Company appointed Ms. Soraia Morais to the Executive Position of Chief Financial Officer. Ms. Morais is a Chartered Professional Accountant with over 15 years of experience in accounting and financial management. She started working in the resource sector in 2009. Prior to that, she accumulated an extensive business background including managing her own business and spending 5 years at PricewaterhouseCoopers Brazil. She is a dual citizen of Canada and Brazil and fluent in English and Portuguese, with working knowledge of Spanish. She has a University of British Columbia Diploma in Accounting and a Bachelor of Accounting Sciences from Brazil. From 2014 to 2018 Ms. Morais was the VP of Finance of Meridian.
In view of the increase in global manganese prices subsequent to year end, the Company continues to evaluate a possible restart of its Mn operation. The Company may consider restarting for the 2020 dry season to "batch supply" only one or two specific clients. A restart of production would also benefit from an improvement in the USD to BRL exchange rate.

Exploration Highlights

On January 8, 2020 the Company released an update on the Jaburi area, where a trial mining licence was approved for the production of up to 30,000t of Manganese oxide concentrate per annum, valid until 13 September 2021. The Jaburi area has produced amongst the project's best quality concentrates. The trial mining licence provides an option to recommence production from sources close to the existing plants, including newly delineated showings that had not previously been mined.
On January 22, 2020 the Company released an update on its Ariquemes Exploration Project, following release of new data and interpretations by the Companhia De Pesquisa De Recursos Minerais ("CPRM") – (Geological service of Brazil). The CPRM review highlighted geophysical signatures in magnetic and radiometric data consistent with the presence of tin-bearing granites within the Company's project area. Broad-spaced stream-sediment sampling also highlighted the tin and gold anomalies requiring further evaluation.
On January 23, 2020 the Company released a review of the 2015 aerial electromagnetic ("EM") Maxwell conductive plate models and their relationship to target corridors of the Espigão Copper-Gold polymetallic project. Nine modelled EM show spatial relations to polymetallic soil anomalies associated with showings of Mn and Fe oxides. These represent targets to test at depth for zoned polymetallic systems. Additional Maxwell Plate modelling remains to be conducted for other EM anomaly clusters.

Except as disclosed elsewhere in this document there were no other material subsequent events to the date of this report.

Espigão Project

Background

The Espigão Manganese Project is located in the Proterozoic Rondônia-Juruena Province, in the SW margin of the Amazon Craton. The licences cover an area of 156,447 Hectares and incorporate an approved mining lease, mining lease applications, and exploration tenure. Mining activity to date has focussed on production of the manganese oxides which occurs in two main forms: 1) structurally controlled steep-dipping primary hydrothermal veins; and 2) near-surface flat-lying colluvium where manganese oxide rock fragments are located at the base of the soil profile.

The various vein systems show a spatial relationship with a series of fractionated granites, marked by an elevated response in Total Count radiometrics. Geophysical modelling shows the presence of conductivity anomalies and magnetic anomalies underpinning the surface veins. These anomalies remain to be systematically tested at depth. An ongoing exploration objective is to test the potential for vertical and lateral transitions to domains dominated by base metal and precious metal assemblages, as part of the zoned mineral system, whilst optimizing manganese production.

Espigão Polymetallic Potential

Espigão is an advanced exploration project with an extensive database of geological and geophysical information that requires an investment in time and money to capitalize on. The Company believes that the extensive polymetallic soil anomalies,

Management's Discussion and Analysis

associated pathfinder minerals and co-incident geophysical conductivity anomalies reflect Cu-Au potential, and will be evaluated to test for Iron Oxide Copper Gold ("IOCG") / intrusive related mineralization.

The Espigão Project area hosts diverse vein systems, including base-metal anomalous manganese oxide veins, iron-oxide breccias, gold-bearing quartz-pyrite veins, and tin-bearing greisen. The Cu-Pb-Zn base metal association in the manganese veins becomes progressively enriched in the northern sector of the project area (with peak assay values in drilling of 0.62% Cu, 6.56% Pb, 0.14% Zn).

On May 28, 2019 the Company released the results of the first integrated 3-D modelling undertaken on the airborne magnetic and conductivity data covering the Espigão project in Rondonia, Brazil. Multiple magnetic anomaly clusters have been identified. These anomalies underlie the surface expression of the base-metal anomalous manganese vein arrays. Many magnetic anomalies are coincident with the subsurface projection of conductors modelled from electromagnetic survey data. Results point to a much more intricate architecture to the intrusive system than first thought. These anomalies provide targets for future testing of discrete intrusive bodies interpreted to lie at depth and to drive the hydrothermal vein systems and metal assemblage.

The 2015 airborne HeliTEM survey covered an extensive part of the Espigão project and detected 60 plus conductive clusters. To date, only 9 of these clusters have had the data processed and the Maxwell plates modelled. In late 2018 the Company commissioned the processing of the related magnetic data that mapped significantly anomalous magnetic anomalies underlying the modelled Maxwell plates that are in turn coincident to the mapped, polymetallic soil anomalies. The Company has planned and budget a program whereby the residual conductive clusters are modelled, and an airborne gravity survey is conducted. The time frame for this is depended on the availability of funds.

The Company has continued to review and access the Espigão district's polymetallic potential and believes that a strong exploration project is evolving with the information that is being produced

Manganese Exploration and Mining

The Company's exploration and mining activity has focussed on the colluvial and free digging saprolite-hosted vein manganese oxide mineralization (based on the Jaburi Plant processing flow sheet and economic considerations). Excavations are conducted at shallow depths, with no drilling and blasting required in the saprolite zone.

The manganese oxide colluvium is excavated from a 1 to 2 m thick soil profile. The material is pre-screened adjacent to or in proximity to the mine site, to separate the soil and non-recoverable fine fraction from the coarser colluvium. Screened reject material is returned to the site of extraction, topsoil replaced, and the site is reseeded for return to agricultural use.

The free digging saprolite layer hosts sheeted veins, stockworks, and brecciated to semi-massive Mn oxides, and has so far been mined to a depth of 10-15 meters below the colluvial layer. The saprolite material is pre-screened (wet or dry) and processed using the existing facilities at the Jaburi Plant.

The Company has conducted trial mining on the primary non-weathered massive Mn oxide vein at the Antônio Gomez prospect. This required the granting of a blasting permit (duly received and executed in 2018). The resulting blasted material when first processed in 2018 failed to produce a commercial concentrate. A secondary trial (1st Quarter 2019) was undertaken via close geological supervision involving mechanical separation of waste blocks prior to direct shipping to the Jaburi Plant. The average concentrate grade from the second trial was 52.4% Mn based on final certified analyses reported.

Due to the financial limitations of the Company, recent field activities have mainly been focussed on the definition of manganese oxide production areas. Work on the broader polymetallic exploration opportunity has been focussed on targeting and geophysical reviews, whilst the Company evaluates funding options to reinitiate gold and base metal exploration.

Mineral Processing and Metallurgical Testing

The Company's manganese oxide concentrate has been derived from the modern Jaburi pilot plant via gravity separation (jigging) with minor primary and secondary crushing. No chemical beneficiation is required. An historical plant at the same site produced ~10,000 tonnes per annum (tpa). The Jaburi Plant, following initial metallurgical studies conducted through American Metallurgical Lab LLC, SGS Canada, Ausenco, Allmineral and Gekko Systems, was in 2018 upgraded to a 50,000 tpa pilot plant with additional primary and secondary crushing circuits. Located on the southern boundary of the Espigão project, the Jaburi Plant is farther away to the majority of the future manganese oxide occurrences that will be extracted to

Management's Discussion and Analysis

provide the bulk of future feed. As such, the project's OPEX will always incur a larger internal logistic cost that has been partially mitigated by use of pre-screening at the location of Mn oxide occurrences. The plant has a design limitation that diminished the jigging circuits through put.

During the year, the Rio Madeira plant was operated as a centralised wash plant that provided additional feed to the Jaburi plant. The modification of the processing flow sheet to include pre-screening prior to transportation to the Jaburi Plant has achieved multiple financial savings. These are related to higher excavator utilisation, lower trucking volumes and associated fuel consumption, energy savings at the Jaburi Plant via lower cycle times in the trommel and related water pumping requirements. The emptying of the Jaburi settling ponds is now less frequent, from a historical high of every 15 days to approximately 90 days; depending on the pre-concentrate feed grade. The Rio Madeira plant's fine jig was recommissioned and the 5 to 15mm size fraction was separated out from the bulk concentrate prior to it being sent to Jaburi. The Rio Madeira fines concentrates was commercialised locally and internationally.

The Jaburi Plant recovers three size fractions: 2.5 to 15mm, 15 to 25mm and 25 to 75mm. Material greater than +75mm is sent to a secondary crusher and then reprocessed. Some hand sorting to remove waste and lower grade breccia material occurs. The Rio Madeira Plant currently acts as an intermitted centralise washing plant with the resulting +15mm pre-concentrate trucked to the Jaburi Plant for final concentrate production; with mineralization in the < 5mm fraction going to tailings. The Jaburi Plant recovers the 2.5 mm fraction by jigging with < 2.5mm fraction going to tailings. The jigging process concentrates a product which is currently ~90 - 95% manganese oxide mineral product (5-10% gangue).

To maintain a commercial volume of +48% Mn premium concentrate the Jaburi Plant was optimised to operate on a minimal Mn recovery basis of a 60%. The coarse reject from the plants is stockpiled for potential future reprocessing and commercialisation.

The reject from the concentrating process is either an inert gravel or fine grain inert soils. Once dried, the soils are returned to the farmland as topsoil while the gravels are used as a road aggregate.

The processed manganese oxide product is transported to the stockpile yard in Espigão do Oeste where material is catalogued, sampled and stored for sales. The Company has supplied internationally and domestically three product sizes: lump (>25 mm), medium (15 to 25 mm) and fine manganese oxide (2.5 to 15 mm).

The Company produced 6,782 tonnes of MnOx product in the fourth quarter of 2019 versus 5,163 tonnes during the fourth quarter of 2018, a 31% increase in production over the comparative period. The later part of the fourth quarter was impacted by the commencement of the wet season. The high quality of the product was maintained with an average production grade of 51.6% Mn, based on laboratory-certified analyses of stockpile samples. During the year ended December 31, 2019, the Company produced 29,886 tonnes of MnOx at an average grade of 52.0% Mn versus 37,279 tonnes during the year ended December 31, 2018, a 20% decrease in production over the comparative period.

The Company cautions that it has not completed any feasibility studies on any of its manganese properties. The previously published NI43-101 manganese oxide inferred resource was found to be non-compliant by the SRK NI43-101 property report of August 26, 2016, and no NI43-101 mineral resource estimate has been re-established. Because the Company's production decision is not based upon a feasibility study of mineral reserves, the economic and technical viability of the property has not been established.

Permitting, Corporate Social Responsibility and Environment

The Company's Espigão Project currently covers an area of 156,447 Hectares, including satellite licences in adjacent areas (but excluding Mirante da Serra and Ariquemes).

Permitting is required before proceeding to mine an area – the permits states the amount of manganese oxide that can be mined per each concession. At the year end, the Company had approximately 63,000 tonnes of Mn oxide permitted through GU's (trial mining permits) on five concessions until 2020-2021, i.e. Vitalino, Lucas, Francisco, Antônio Gomes, Califórnia, and the newly granted Ademir Curral GU. Applications can be lodged to increase the tonnage of Mn oxide produced. Another 48,000 tonnes are currently under review by the authorities. Mining licences, once approved, will supersede the GU's.

Management's Discussion and Analysis

Because of the environment and weather conditions, rehabilitation of mine sites is efficient solely during the dry season – approximately 8 months is required for complete re-vegetation of sites.

The Company is well regarded locally – it is an important employer and has a good reputation for its stewardship of its local operations. The many local initiatives to enhance the Company's social license to operate have been incorporated within its management protocols and have further strengthened the Company's local reputation. Rehabilitation programs are actively continuing through the care and maintenance period.

Mirante da Serra Project, Rondônia, Brazil

The MdS Mn project is a resource development and exploration project that, via a series of sequential payments described below, each related to operational and administrative milestones, the Company can acquire a 100% ownership. Historical and Company mapping programs have identified an initial 4km semi-continuous trend of colluvial Mn occurrences with grades up to 50.9% Mn. The Mn is sedimentary in origin and has the potential to develop into a stand-alone mining project. A full 18-month resource delineation and exploration program is being considered, but will be subject to financing.

Background

The Company entered into an option agreement to acquire a 100-per-cent interest in the Mirante da Serra manganese project, in Rondonia, Brazil from Mr. José Olímpio de Miranda (licence 886166/2009). Following a sequential process related to project and administrative milestone achievements, Meridian, at its election, will acquire the project for a cumulative consideration of 1,140,000 million Brazilian real (approximately $300,000). This acquisition follows an extensive due diligence program, including mapping, sampling and granulometry studies. The payment terms have been linked to project development milestones to decrease risk for the Company. The staged payments will be made as follows:

40,000 Brazilian reals upon signing (paid $10,296);
75,000 Brazilian reals upon approval of the final report by Brazilian National Mining Agency (Agência Nacional de Mineração - "ANM") (formerly - National Department of Mineral Production); title to transfer to Meridian;
125,000 Brazilian reals on the Meridian board of directors' approval of a positive PEA (Plano de Aproveitamento Econômico ("PAE") or Economic Mining Plan);
150,000 Brazilian reals following the ANM approval of PAE;
250,000 Brazilian reals one-year anniversary of ANM approval of PAE
500,000 Brazilian reals upon grant and publication of a valid mining licence (Lavra);

Mr. José Olímpio de Miranda will retain a 0.5% NSR, with a one million Brazilian real buyback clause.

During the Quarter the Company's representatives have been working with the ANM to provide information to supplement to the final report based on its observations during due diligence.

Geology and Mineralization Model

Geological maps show the Mirante da Serra manganese oxides to be hosted by sandstones of the Pimenta Bueno Formation, forming a northwest extension of the Parecis Basin. This basin has a history spanning Neo-Proterozoic to Palaeozoic times, with deposits of glacio-marine regressive and transgressive sandstones, carbonates, and shales. The chemistry of the manganese (higher phosphorous, low base metals) is consistent with a sedimentary origin. Colluvial concentrations are present, similar to those seen at Espigão do Oeste. Mixed cemented laterite-manganese oxide horizons are also present as a surficial capping and are believed to be derived from a primary basement source (the laterites would be difficult to upgrade, but the colluvium and underlying primary manganese mineralization would be targeted for evaluation and development). The laterite cap and soil cover frequency conceal the primary source rocks.

The manganese content progressively increases from upwards from approximately 20% Mn as it becomes more concentrated in the host sediments, with the semi-massive samples reaching grades of up to 50.9% Mn. Levels of iron, silica and aluminium decrease with increasing manganese grade. The higher-grade manganese oxides have lower base metal contents and elevated phosphorous contents than the Company's concentrates from the Espigão Project. The Company has reviewed the analytical data in relation to manganese markets and believes that the high-grade product would be sought after for fertilizer and welding applications and potentially battery metal applications.

Management's Discussion and Analysis

Exploration

Historical exploration in the area and Meridian’s due diligence review has defined manganese mineralization over a central corridor of four kilometres in a northeast trend, with a maximum cross-strike footprint of one kilometre. The Company has identified additional occurrences in the southern sector of the licence area requiring further evaluation. The better concentrations of surficial manganese oxide appear to be distributed over an area of approximately 125 hectares in the northern area, but additional grade control pitting trenching and drilling is required to confirm and sequence a final extraction plan.

The Company conducted several field visits to the Mirante da Serra project during the 4th Quarter of 2019. Large expansive occurrences of colluvial manganese are evident in clearings in the northern sector of the licence area, highlighting the near-surface exploration potential of the project. Additionally, historical exploration pits were exposed by the clearing of pasture and regrowth. Here, colluvial manganese oxide layers exceeded 1.75m in thickness.

The Company intends to conduct a program, testing the extent and grade of the colluvial mineralization, and more particularly the primary sediment-hosted manganese oxide layers where it believes the long-term upside is. The basement sedimentary manganese formation directly underlies the colluvial horizon and has not been previously drilled. If the horizon has a shallow dip, a significant footprint of mineralization is potentially available - systems can extend for kilometres without necessarily having an obvious surface expression.

Permitting, Corporate Social Responsibility and Environment

The Company on closure of the agreement has engaged with ANM on the ongoing renewal of the Mirante da Serra license area. These discussions are aimed at the renewal process and long-term success of the developing an operational asset.

The Company will leverage its successful “Espigão” social license to operate the Mirante da Serra project and seek open and positive dialogue with the local stakeholders.

The global environment of the Mirante da Serra provides a wholly superior opportunity to develop a successful manganese operation. Access to the project requires only transiting 14km of unsealed gravel roads and is well serviced by local and regional town centres, along existing logistic corridors and power lines. The terrain is principally a single plateau with the land use primarily pasture with some minor cropping and reforested areas, with no preservation status. The project is external to regional Indian reservations and related buffer zones.

Ariquemes Tin Project, Rondônia, Brazil

As the public markets ability to finance brownfields exploration is limited at this time, the Company has chosen to focus its efforts and potential investor funds away from the Ariquemes project. The Ariquemes exploration project will be maintained while the Company searches for a JV partner to finance and manage the project. The Bom Futuro JV project has been under review since 2019 and a decision on its future will be made in 2020.

Background

The Ariquemes District is located in the Juruena Domain of the Rondônia-Juruena Province, in the SW margin of the Amazon Craton. Metavolcano-sedimentary rocks of the basement once formed part of a Palaeo-Proterozoic Andean-type arc. The basement is intruded by Meso- to Neo-Proterozoic granites. The youngest granites associated with tin-columbite-tantalite mineralization (the Santa Clara Intrusive Suite, and the “Younger Granites of Rondônia”).

Many of the tin mines in the region were discovered and developed during the 1970’s and 1980’s as settlement of the state accelerated. The province represents Brazil’s second largest tin district. The reported production from drainage systems and primary bedrock sources totals over 270,000t of tin. A significant part of this has been derived from the Bom Futuro tin mine, which has produced more than 195,000 tonnes of tin since its discovery in 1987. The region has a variable level of basement exposure, with younger Cainozoic sediments covering much of the area. This younger sedimentary sequence includes mineralized palaeovalleys which have been a rich source of tin production.

A targeting study in 2016-2017 by the Company identified the geophysical signature of the prospective granites extending away from exposed areas and projecting under the younger cover sediments. The Company applied for licences totaling 293,503 Ha in prospective corridors, with a particular focus between the Bom Futuro and Santa Barbara mining centres. Licences

Management's Discussion and Analysis

totalling 98,508 Ha are now approved for exploration. The Company believes that modern exploration methods have potential to detect concealed primary and secondary mineralization in these covered areas.

In June 2019, the Companhia De Pesquisa De Recursos Minerais ("CPRM"; Geological service of Brazil) launched new publications and mapping products in Ariquemes as part of its ARIM program (Áreas De Relevante Interesse Mineral). The studies form an initiative to stimulate exploration and production by providing new data in select areas judged to be highly prospective. The Ariquemes District was one of the areas selected for re-evaluation, in light of its significant production history and, ongoing contribution to the economy. The CPRM's analysis concludes that geophysical signature of the tin-prospective granites is broader than the surficial mapping suggests, backing the Company's belief that the region presents attractive undercover exploration targets.

The Company is currently looking at the possibility of transferring the Ariquemes Tin Project in a separate legal entity to be spun out – in doing so, the Company would be in a better position to identify a JV partner to take on the Project and attract alternate funding options to move the project forward.

With regards to the Bom Futuro JV Project, the Company and the Cooperative recognize that Brazil's current economic and political situation makes it difficult to fund infrastructure and brown field exploration projects within the country. Meridian Mining is in discussion with the Cooperatives to find a solution to the project.

The technical information about the Company's exploration activity and production has been prepared under the supervision of and verified by Dr. Adrian McArthur (B.Sc. Hons, PhD. FAusIMM), the Chief Geologist of Meridian, who is a "qualified person" within the meaning of National Instrument 43-101. Manganese grades referenced in the report are determined by lithium-borate fusion - XRF techniques at ALS, backed by a quality control program.

Selected Annual Information:

The following table provides a brief summary of the Company's annual financial operations. For more detailed information, please refer to the financial statements:

	Year Ended December 31, 2019	Year Ended December 31, 2018	Year Ended December 31, 2017
Revenues	$ 6,262,477	$ 10,222,287	$ 10,456,724
Net loss before income taxes	(17,327,659)	(11,091,042)	(14,588,754)
Net loss	(17,346,659)	(11,091,042)	(14,588,754)
Total assets	10,060,094	20,850,142	33,733,731
Working capital (deficit)	(25,157,358)	(607,366)	(12,015,401)

Quarterly Financial Summary:

	Qtr 4 Three Months Ended December 31, 2019 $	Qtr 3 Three Months Ended September 30, 2019 $	Qtr 2 Three Months Ended June 30, 2019 $	Qtr 1 Three Months Ended Mar 31, 2019 $
Revenues	2,481,729	1,755,322	1,103,534	921,892
Net Loss for the period	(12,251,922)	(1,868,993)	(1,531,134)	(1,675,610)
Total Comprehensive Income (Loss)	(11,732,831)	(3,090,937)	(1,324,252)	(1,880,058)
Net Loss per share and fully diluted loss per share	(0.07)	(0.02)	(0.01)	(0.01)

Management's Discussion and Analysis

	Qtr 4 Three Months Ended Dec 31, 2018 $	Qtr 3 Three Months Ended September 30, 2018 $	Qtr 2 Three Months Ended June 30, 2018 $	Qtr 1 Three Months Ended Mar 31, 2018 $
Revenues	4,000,326	740,621	586,597	4,894,743
Net Loss for the period	(6,717,820)	(2,512,973)	(1,034,491)	(825,758)
Total Comprehensive Income (Loss)	(5,336,298)	(3,411,311)	(4,899,126)	(683,900)
Net Loss per share and fully diluted loss per share	(0.03)	(0.02)	(0.03)	(0.00)

Discussion of Fourth Quarter Results:

Sales in the fourth quarter were 11,943 tonnes of manganese oxide product compared to 14,052 tonnes during the fourth quarter of 2018, a decrease of 15% compared to the comparative period. Revenue decreased by $1,518,597 (38%) to $2,481,729 due to a combination of factors, including weaker Mn prices, decrease in tonnes sold (due to plant being put into care & maintenance), and the strengthening USD compared to the BRL. The majority of product shipped in fourth quarter of 2019 went to international customers. The Company had renegotiated its sales agreements with local customers with improvements in price and bonuses for grade and some exposure to international spot prices. For the three months ended December 31, 2019:

Sales decreased by $1,518,597 to $2,481,729 (2018 – $4,000,326). Mn prices weakened further over the quarter and tonnes sold decreased due to a drop in production as the plant was put on care and maintenance; and
Production costs decreased by $1,507,419 to $2,668,713 (2018 – $4,176,132). The 36% decrease in production costs is related to the plant shut down event during the period.

In early December 2019, the Company announced that due to the continued depressed world manganese ore prices, production from the Company's Espigão do Oeste Manganese operation in Rondônia, Brazil, would immediately be put on temporary care and maintenance. Following the decision to put the plant on care and maintenance the Company determined that the Goodwill and certain plant and equipment related to the manganese operation were impaired. The Company recorded the following impairments and write-offs relating to the change:

Impairment of Property, Plant and Equipment of $8,021,426 (2018 - $nil). The Company did an assessment of all plant and equipment related to the mining operation and recorded an impairment write-down of $8,021,426;
Impairment of Goodwill expenses of $918,344 (2018 - $nil). Upon completion of an impairment review it was determined that the goodwill was impaired and was therefore written down to $nil;
Write-off of tax credits of $946,172 (2018 - $nil). This was due to uncertainty of recovery as the Company would not have sales to recover the tax-credits.;

The transition to care and maintenance also had a significant impact on other accounts. Significant expense amounts and movements for the most recent quarter included:

Exploration and evaluation expenses increased by $141,825 (82%) to $314,059 (2018 – $172,234). The variance mainly related to the increase in exploration as the Company advanced the polymetallic project. The Company is currently reviewing its portfolio of assets and is considering financing options to enable the Company to continue exploration on the projects;
General and administration expenses increased by $382,483 (229%) to $549,656 (2018 – $167,173). The increase was due to costs related to staff dismissals as the company's manganese operation went into care and maintenance;
Professional fees increased by $60,241 (988%) to $66,340 (2018- $6,099). During the fourth quarter the Company executed an internal corporate restructuring. The restructuring included the dissolution of Dutch subsidiary Ferrometals BV during 2019 and Ferrometals Brazil and Ferrometals Management Services Canada Inc are in the process of being dissolved. The Company completed the restructuring to create a more efficient and cost-effective structure moving forwards;
Share based payments expenses increased to $447,890 (2018 - $nil). The Company granted 15,200,000 stock options during the year ended December 31, 2019 at a price of CA$0.07 per common share to directors, officers, employees and consultants;
Re-commissioning and standby costs increased by $348,986 (489%) to $420,301 (2018 - $71,315). The increase was due to the plant being put in care and maintenance during December;

Management's Discussion and Analysis

Finance expenses increased by $108,979 (25%) to $552,760 (2018 - $443,781) due to the increased debt facilities compared to the comparative period;
Foreign exchange gain increased by $270,767 (380%) to a gain of $199,426 (2018 – loss of $71,341). The foreign exchange loss increased due to fluctuation of exchange rates during the quarter;
During the fourth quarter in 2018 the Company recognized an expense of $5,536,182 relating to the disposition and impairment of exploration licenses. Due to unfavourable exploration results the Company abandoned two exploration licenses which were previously acquired as part of the Cancana acquisition with carrying value of $5,402,744. In addition, the Company wrote-off $133,438 related to the Bom Futuro Project due to a delay in development of the project; and
Included in Other Comprehensive Loss, Foreign currency translation decreased by $843,431 (61%) to a gain of $538,091 compared to a gain of $1,381,522 during the fourth quarter ended December 31, 2018. This movement relates to the translation of the Jaburi assets (BRL Functional Currency) to USD. During the fourth quarter of 2019 the BRL devalued compared to the comparative period.

Discussion of Annual Results

The consolidated financial statements reflect the financial performance of the Company for the year ended December 31, 2019. During year ended December 31, 2019, the Company incurred a comprehensive loss of $18,028,078 as compared to a loss of $14,330,635 for the year ended December 31, 2018.

Revenues during the year decreased to $6,262,477, from $10,222,287 during the comparative period ended December 31, 2018. The decrease in sales was largely driven by the depressed manganese ore prices. During the year the spot price of Manganese oxide decreased significantly, from USD7.18 to USD3.73 ~48% decrease from the start of the year. In addition, as discussed above the Company put the plant into care and maintenance, which decreased annual production.

Production costs decreased to $7,493,996 from $11,201,923 during the comparative period. The main factors for the decrease were the decrease in costs in Q4 related to event of plant put on maintenance and care and also due to focus on cost savings.

Operating expenses totaled $14,332,709 for the year ended December 31, 2019 compared to $10,072,857 for the year ended December 31, 2018. As discussed in the Discussion of Fourth Quarter and Quarterly Results section above, two events which had a significant impact of the expenses for the Company were the plant being put into care and maintenance and the internal restructuring. Please refer to the Discussion of Fourth Quarter and Quarterly Results section for a discussion on the movement of the following accounts: Impairment of Goodwill ($918,344); Impairment of Property, Plant and Equipment ($8,021,426), and Write-off of Tax Credits ($946,172).

Operating expenses with significant balances or significant movements include:

General and administration costs of $1,855,222 (2018 - $2,313,002). Total general and administration costs decreased by $457,780 (20%) over the comparative period. The Company has focused on cutting general and administration costs, efficiencies and savings plan since second half of 2017 and expects further costs savings during 2020 as the Company focuses on exploration and realizes the savings from the restructuring;
Professional fees of $374,543 (2018 - $553,727). Professional fees decreased by $179,184 (33%) due to a drop-in corporate activity during the period. The Company expects corporate and professional fees to drop further during 2020 as it executed an internal corporate restructuring during the December 2019. The restructuring included the dissolution of Dutch subsidiary Ferrometals BV during 2019 and Ferrometals Brazil and Ferrometals Management Services Canada Inc are in the process of being dissolved;
Exploration expenditures of $1,144,819 (2018 - $1,220,697). The decrease of $75,878 (6%) is related to the decrease in the exploration and drilling programs post the completion of the PEA. Please refer to the project sections for a discussion on exploration activities;
Share based compensation increased to $447,890 (2018 - $nil). The Company granted 15,200,000 stock options during the year ended December 31, 2019 at a price of CA$0.07 per common share to directors, officers, employees and consultants;
Re-commissioning and standby costs increased to $445,166 (2018 - $126,759). The increase of $318,407 (251%) was due to Company putting the plant in care and maintenance, as discussed above; and
In December 2018 the Company abandoned two exploration licenses due to unfavourable exploration results. The licenses were part of the Cancana acquisition and all related acquisition costs, totalling $5,402,744, were written off.

Management's Discussion and Analysis

Also, due to a delay in development on the Bom future project the Company elected to write-off the capitalized acquisition costs ($133,438).

The results for the year ended December 31, 2019 included a total comprehensive gain of $681,419 (2018 – loss of $3,239,593) comprised of foreign currency translation, which related primarily to the translation of the Company’s Brazilian operation.

Liquidity and Capital Management

As at December 31, 2019, the Company reported a working capital deficit of $25,157,358 (December 31, 2018 – deficit of $607,366) which included cash of $530,322 (December 31, 2018 - $201,712). Included in current liabilities at December 31, 2019 are accounts payable and accrued liabilities of $1,431,830 (December 31, 2018 - $1,703,704), loans payable of $24,786,099 (December 31, 2018 - $nil) and provisions of $722,353 (December 31, 2018 - $703,801). The main reason for the weakened working capital is as a result of the loan facilities now being due during the next 12 months (March 31, 2020). As described in the Subsequent Events section, the Company has negotiated a stand-still and conversion agreement on the debt which will significantly improve the working capital.

The capital structure of the Company consists of equity attributable to common shareholders, comprising of share capital, share premium, reserves and deficits and the convertible note. The Company’s objectives when managing capital are to: (i) preserve capital, (ii) obtain the best available net return, and (iii) maintain liquidity.

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 the capital structure, the Company may attempt to issue new shares, issue new debt, acquire or dispose of assets or adjust the amount of cash and investments.

The Company’s policy is to invest its excess cash in highly liquid, fully guaranteed, bank sponsored instruments. This strategy is unchanged from the year ended December 31, 2018. The Company is not subject to externally imposed capital requirements and does not have exposure to asset-backed commercial paper or similar products.

The Company has historically relied upon capital contributions and debt facilities provided by its shareholders, to maintain an adequate level of cash to satisfy its capital and operating requirements and expects to continue to depend heavily upon its majority shareholder for financing. The Company does not have any other sources of funding.

To continue as a going concern, the Company must generate sufficient operating cash flows to fund its capital and operating requirements or secure new funding. The ability of the Company to arrange additional financing in the future will depend, in part, on the prevailing capital market conditions and exploration success and on the willingness and ability of its majority shareholder to continue providing financing. There can be no assurance that these initiatives will be successful, or sufficient financing, including financing from its majority shareholder, will be available. These material uncertainties cast significant doubt as to the ability of the Company to meet its business plan and obligations as they come due and, accordingly, the appropriateness of the use of accounting principles applicable to a going concern.

Debt facilities

Below is a summary of the Company’s current loan facilities, which total $19,750,000 due to Sentient Global Resources Fund IV and $1,000,000 due to The Sentient Group, plus interest. All facilities were due March 31, 2020 and were subsequently extended to July 30, 2020. As described in the Subsequent Events section, the Company has negotiated a stand-still and conversion agreement on the debt, subject to certain conditions, which will significantly improve the working capital. Please also refer to the Subsequent Events section for a discussion of the stand-still and conversion agreements.

(i) In October 2016, the Company entered into a non-arm’s length loan agreement with Sentient Global Resources Fund IV LP for $7,000,000, which was amended and increased to $7,500,000 in August 2017, and to $8,500,000 in December 2017. The loan bears interest at a rate of 10% per annum and is for a term of 1.5 years. On December 31, 2018 the Company negotiated an extension of the maturity date to March 31, 2020 and subsequently to July 30, 2020 as part of a standstill and conversion agreement as described in the Subsequent Events sections.

(ii) In 2016, prior to the closing of the share exchange the outstanding loan balance of $1,000,000 which Cancana had borrowed from Ferrometals BV was restructured such that Sentient Global Resources Fund IV LP became the counterparty of the loan facility. The interest rate was amended to 10% effective January 1, 2017. On September 30, 2018 the Company negotiated an extension of the maturity date to March 31, 2020 and subsequently to July 30, 2020 as part of a standstill and conversion agreement as described in the Subsequent Events sections.

Management's Discussion and Analysis

(iii) In October 2017, the Company entered into a $1,000,000 non-arm's length unsecured short-term loan facility with The Sentient Group Limited, The loan bears interest at 10% per annum. On September 30, 2018 the Company negotiated an extension of the maturity date to March 31, 2020 and subsequently to July 30, 2020 as part of a standstill and conversion agreement as described in the Subsequent Events sections.

(iv) In December 2017, the Company entered into a non-arm's length loan agreement with Sentient Global Resources Fund IV LP for $1,500,000. The loan bears interest at a rate of 10% per annum. On September 30, 2018 the Company negotiated an extension of the maturity date to March 31, 2020 and subsequently to July 30, 2020 as part of a standstill and conversion agreement as described in the Subsequent Events sections.

(v) In September 2018, the Company entered into a $2,000,000 unsecured loan facility with Sentient Global Resources Fund IV LP. The loan bears interest at 10% per annum and was due to mature on September 30, 2019 but was subsequently extended to March 31, 2020 and subsequently to July 30, 2020 as part of a standstill and conversion agreement as described in the Subsequent Events sections.

(vi) In August 2018, the Company entered into a $1,500,000 unsecured loan facility with Sentient Global Resources Fund IV LP. The Company entered into agreements to increase facility from $1,500,000 to $3,000,000 on January 24, 2019, from $3,000,000 to $4,500,000 on April 18, 2019, from $4,500,000 to $5,200,000 on August 28, 2019 and from $5,200,000 to $6,750,000 on December 04, 2019. The loan bears interest at 10% per annum and are due on March 31, 2020. The loan bears interest at 10% per annum and are due on March 31, 2020. Subsequent to year end the Company extended the due date to July 30, 2020 as part of a standstill and conversion agreement as described in the Subsequent Events sections.

Related Party Transactions

a) Key management compensation

	December 31, 2019	December 31, 2018
Salaries, consulting and directors' fees	$ 582,478	$ 728,731
Share-based compensation	359,491	-

The Company had the following transactions with entities related by way of common directors and/or management:

a) Professional fees of $34,328 (2018 - $25,989) paid to Trustmoore (Netherlands) BV, a company which a director of a former subsidiary is an employee of.

On October 2019, the Company granted 12,200,000 options with a weighted-average fair value of CAD$0.07 per option to directors.

As at December 31, 2019 the Company had the following balances due to/from entities related by way of common directors and/or management. These amounts, unless otherwise noted, were unsecured and non-interest bearing.

	December 31, 2019	December 31, 2018
Accounts payable and accrued liabilities	$ 44,479	$ 56,392
Prepaid expenses and other assets	-	15,234

Share Capital

Outstanding Share Data

As at December 31, 2019 the Company had authorized capital of €5,000,000 and is authorized to issue 500,000,000 common shares with a par value of €0.01.

As at the date of this report the Company has 163,822,421 issued and fully paid shares outstanding.

Stock Options and Warrants

The Company has a stock option plan under which it is authorized to grant options to directors, employees and consultants to acquire up to 10% of the issued and outstanding common share. The exercise price of each option is based on the market price

Management's Discussion and Analysis

of the Company's share for a period preceding the date of grant. The options can be granted for a maximum term of 10 years and vest as determined by the board of directors.

The following incentive stock options were outstanding at the date of this report:

	Number of Shares	Exercise Price	Expiry Date
Stock options	1,050,000	$ 0.44	May 17, 2022
	15,170,000	0.07	October 22, 2024

Critical Accounting Estimates

The preparation of the consolidated financial statements requires management to make judgments and estimates and form assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and reported amounts of expenses during the reporting period. On an ongoing basis, management evaluates its judgments and estimates in relation to assets, liabilities and expenses. Management uses historical experience and various other factors it believes to be reasonable under the given circumstances as the basis for its judgments and estimates. Actual outcomes may differ from these estimates.

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

Certain estimates and judgements, such as those related to mineral production, the recoverability of property, plant and equipment, and goodwill, deferred tax assets and liabilities, depreciation and depletion, recovery of exploration and evaluation assets, and the determination of cash generating unit depend on subjective or complex judgements about matters that may be uncertain. Changes in those estimates and judgements could materially impact these consolidated financial statements.

Material sources of estimation uncertainty include:

Mineral Production

The Company's mine assets are depleted and amortized on a units of production basis, using the expected amount of future production. The Company does not have a National Instrument 43-101 compliant resource estimate for its manganese deposits and accordingly uses expected forecasts based on available geological and technical data as a basis for the expected amount of production. Changes to these estimates, which can be significant, could be caused by a variety of factors, including future production differing from current forecasts, development of mineral resources or factors, erroneous estimations or factors that impact the expected life of the mining operation.

Deferred taxes

The Company's operations involve dealing with uncertainties and judgments in the application of complex tax regulations in multiple jurisdictions. The final taxes paid are dependent upon many factors, including negotiations with tax authorities in various jurisdictions and resolution of disputes arising from tax audits. The Company recognizes potential liabilities and records tax liabilities for anticipated tax audit issues based on its estimate of whether, and the extent to which, additional taxes will be due. The Company adjusts these reserves in light of changing facts and circumstances; however, due to the complexity of some of these uncertainties, the ultimate resolution may result in a payment that is materially different from the Company's current estimate of the tax liabilities. If the Company's estimate of tax liabilities proves to be less than the ultimate assessment, an additional charge to expense would result. If the estimate of tax liabilities proves to be greater than the ultimate assessment, a tax benefit would result.

Impairment of property, plant and equipment, and goodwill

The Company considers both external and internal sources of information in assessing whether there are any indications that its cash generating unit ("CGU") including property, plant and equipment, and goodwill is impaired. External sources of information the Company considers include changes in the market, and the economic and legal environment in which the Company operates and affect the recoverable amount of mining interests and goodwill. Internal sources of information the

Management's Discussion and Analysis

Company considers include the manner in which mining properties, plant, and equipment are being used or are expected to be used and indications of economic performance of the assets.

In determining the recoverable amounts of the Company’s property, plant and equipment, and goodwill, the Company makes estimates of the discounted future after-tax cash flows expected to be derived from the Company’s mining properties, costs to sell the assets and the appropriate discount rate. The projected cash flows are significantly affected by changes in assumptions related to future metal prices, changes in the amount of future production, and exploration potential, production cost estimates, future capital expenditures, discount rates and exchange rates.

Access to estimated future production and exploration potential of the Company’s property, plant and equipment is a key assumption in determining their recoverable amounts. The ability to maintain existing or obtain necessary mining concessions, surface rights title, and water concessions is integral to the access of the production areas and exploration potential.

If the Company determines there has been an impairment because its prior estimates of discounted future cash flows have proven to be inaccurate, due to reductions in manganese prices or demand, increases in the costs of production, reductions in the amounts of production, or other factors, the Company would be required to write-down the recorded value of its property, plant and equipment or goodwill in profit and loss.

Share based compensation and mark-to-market revaluation of warrants

The Company utilizes the Black-Scholes Option Pricing Model (“Black-Scholes”) to estimate the fair value of stock options granted to directors, officers, employees, and consultants and for the mark-to-market revaluation of share purchase warrants. The use of Black-Scholes requires management to make various estimates and assumptions that impact the value assigned to the stock options including the forecast future volatility of the stock price, the risk-free interest rate, dividend yield and the expected life of the stock options. Any changes in these assumptions could have a material impact on the share-based compensation calculation value, however the most significant estimate is the volatility. Expected future volatility can be difficult to estimate as the Company has had limited history and historical volatility is not necessarily indicative of future volatility.

Critical management judgments:

Mineral Production, depreciation and depletion

The Company’s mine assets are depleted and amortized on a units of production basis, using the expected amount of future production. Changes to these estimates, which can be significant, could be caused by a variety of factors, including future production differing from current forecasts, expansion of mineral resources through exploration activities, difference between estimated and actual cost of mining and other factors impacting production or the expected life of mine assets. The Company does not have a National Instrument 43-101 compliant resource estimate and accordingly uses expected forecasts based on available geological and technical data as a basis for the expected amount of production.

Valuation of exploration and evaluation assets

The Company capitalizes the acquisition costs related to its exploration and evaluation assets. This policy requires management to make certain estimates and assumptions as to future events and circumstances. Any such estimates and assumptions may change as new information becomes available. If, after having capitalized the costs, a judgment is made that recovery of the costs is unlikely, the relevant capitalized amount will be written off to profit and loss.

The recoverability of amounts shown for exploration and evaluation assets is dependent on the existence of economically recoverable reserves, the ability to obtain financing to complete the development of such reserves and meet obligations under various agreements, and the success of future operations or dispositions. If a project does not prove viable, all unrecoverable costs associated with the project net of any related existing impairment provisions are written off.

New and revised standards and interpretations

During the year ended December 31, 2019 the Company applied the following new accounting policies:

Management's Discussion and Analysis

IFRIC 23 – Uncertainty over Income Tax Treatments

On January 1, 2019, the Company adopted IFRIC 23 – Uncertainty over Income Tax Treatments (IFRIC 23). IFRIC 23 is to be applied when there is uncertainty over income tax treatment under IAS 12. The adoption of this guidance did not have a material impact on the Company’s consolidated financial statements.

IFRS 16 - Leases

On January 1, 2019, the Company adopted IFRS 16 – Leases (“IFRS 16”) which replaced IAS 17 – Leases and IFRIC 4 – Determining Whether an Arrangement Contains a Lease.

The Company applied IFRS 16 using the modified retrospective method. Under this method, financial information will not be restated and will continue to be reported under the accounting standards in effect for those periods. The lease liabilities will be measured at the present value of the remaining lease payments, discounted using the Company’s estimated incremental borrowing rate as at January 1, 2019, the date of initial application, resulting in no adjustment to the opening balance of deficit. The associated right-of-use assets will be measured at the lease liabilities amount, plus prepaid lease payments made by the Company. The Company has implemented the following accounting policies permitted under the new standard:

leases of low dollar value will continue to be expensed as incurred;
the Company will not apply any grandfathering practical expedients;
the Company will maintain lease agreements under same conditions for short-term leases.

On initial adoption as at January 1, 2019 and as at December 31, 2019, the Company did not recognize any right-of-use assets as it only had short-term leases that would not be captured under IFRS 16.

Contractual Obligations

Except as described above, herein or in the Company’s financial statements, the Company had no other material contractual obligations.

Off-Balance Sheet Arrangements

At December 31, 2019, the Company had no material off-balance sheet arrangements.

Proposed Transactions

Except as elsewhere disclosed in this document (refer to subsequent event section for a description of the proposed debt standstill and conversions arrangements), there are no other proposed transactions under consideration.

Contingencies

Buffer Zone

The Company has been advised that due to certain Jaburi tenements being in close proximity to indigenous title land, Jaburi could be affected by a civil public action between two Brazilian government departments.

Jaburi currently owns several tenements, which border the Povo Cinta Larga indigenous land. Due to illegal diamond mining activities by fourth parties within the Povo Cinta Larga indigenous land and surrounding areas, the Brazilian Federal Prosecutor’s Office (the “FPO”) has filed a civil public action against the ANM. The FPO is requesting the ANM to withdraw all existent research applications and mining authorizations within the indigenous land of Povo Cinta Larga and surrounding area (10km) adjacent to the indigenous land (buffer zone). The ANM has filed appeals to block the FPO civil public action and the final ruling is pending.

Management's Discussion and Analysis

If there is an eventual imposition of a buffer zone, this would have a material impact on Jaburi’s tenements as some of Jaburi’s tenements straddle or are wholly within the proposed 10km buffer zone. The area impacted by the proposed 10km buffer zone would be influence 30,859 Ha of the total Espigão project area.

The Company has retained legal counsel to represent and defend the Company’s interests.

Jaburi has retained legal counsel to represent them in this issue who are filing various legal actions to defend their interests. At this point in time, management has determined it is more likely than not that there will be no amount owing, and therefore no liability has been accrued.

Risk Factors

Companies in the exploration, development and mining stage face a variety of risks and, while unable to eliminate all of them, the Company aims at managing and reducing such risks as much as possible. The Company faces a variety of risk factors such as project feasibility and practically, risks related to determining the validity of mineral property title claims, commodities prices, changes in laws and environmental laws and regulations. Management monitors its activities and those factors that could impact them in order to manage risk and make timely decisions.

Risks and uncertainties the Company considers material in assessing its consolidated financial statements are described below.

Meridian will require additional funding

At December 31, 2019 the Company had negative working capital of $25,138,358, which included cash of $530,322, receivables, prepaid expenses and other assets of $1,002,685, inventory of $249,917, accounts payable and provisions of $2,135,183, and loans payable of $24,786,099. The Company has entered into a debt standstill and conversion arrangement with the debtholders, as described in the subsequent events section.

The Company has historically relied upon both equity and shareholder contributions and loan facilities to satisfy its capital requirements and will likely continue to depend upon these sources to finance its activities. The investment in Jaburi will require additional capital to carry out planned exploration programs and optimize producing operations. The Company, or Jaburi, has not published a NI43-101 manganese resource or reserve statement to date. There can be no assurances that the investment in Jaburi will be cash flow positive, or that if profitable, the profits will be sufficient to fund the exploration program and the operating costs of the Company. There can be no assurances that the Company will be successful in raising the desired level of financing or in extending the loan on acceptable terms.

Meridian is subject to government regulation

The Company’s mineral activities, including exploration, development and mining activities are subject to various laws governing exploration, development, production, taxes, labour standards and occupational health, mine safety, environmental protection, toxic substances, land use, water use and other matters. Failure to comply with applicable laws and regulations may result in civil, administrative, environmental or criminal fines, penalties or enforcement actions, including orders issued by regulatory authorities curtailing the Company’s operations or requiring corrective measures, any of which could result in the Company incurring substantial expenditures. No assurance can be given that new rules and regulations will not be enacted or that existing rules and regulations will not be applied in a manner which could limit or curtail exploration, development or mining operations.

Exploration, development and mining activities can be hazardous and involve a high degree of risk

The Company’s operations are subject to all the hazards and risks normally encountered in the exploration, development and mining industry, including, without limitation, unusual and unexpected geologic formations, seismic activity, rock bursts, pit-wall failures, cave-ins, flooding and other conditions involved in the drilling and removal of material, any of which could result in damage to, or destruction of, mines and other producing facilities, damage to life or property, environmental damage and legal liability. Milling operations, if any, are subject to various hazards, including, without limitation, equipment failure and failure of retaining dams around tailings disposal areas, which may result in environmental pollution and legal liability.

Management's Discussion and Analysis

Meridian may be adversely affected by fluctuations in manganese and other metal prices

The value and price of the Company’s common shares, the Company’s financial results, and exploration, development and mining activities of the Company, if any, may be significantly adversely affected by declines in mineral prices. Mineral prices fluctuate widely and are affected by numerous factors beyond the Company’s control such as interest rates, exchange rates, inflation or deflation, global and regional supply and demand, and the political and economic conditions of mineral producing countries throughout the world.

Infrastructure

Exploration, development and ultimately mining and processing activities depend, to one degree or another, on the availability of adequate infrastructure. Reliable air service, roads, bridges, railways, power sources and water supply are significant contributors in the determination of capital and operating costs. Inadequate infrastructure could significantly delay or prevent the Company exploring and developing its projects and could result in higher costs.

Meridian does not and likely will not insure against all risks

The Company’s insurance will not cover all the potential risks associated with a mining company’s operations. The Company may also be unable to maintain insurance to cover these risks at economically feasible premiums. Insurance coverage may not continue to be available or may not be adequate to cover any resulting liability. Moreover, insurance against risks such as environmental damages, pollution or other hazards as a result of the exploration and production is not generally available to the Company or to other companies in the mining industry on acceptable terms. The Company might also become subject to environmental liability or other hazards which may not be insured against or which we may elect not to insure against because of premium costs or other reasons. Losses from these events may cause Meridian to incur significant costs that could have a material adverse effect upon its financial condition and results of operations.

Meridian is dependent on key personnel

The Company’s success depends in part on its ability to recruit and retain qualified personnel. Due to its relatively small size, the loss of the services of one or more of such key management personnel could have a material adverse effect on the Company. In addition, despite its efforts to recruit and retain qualified personnel, even when those efforts are successful, people are fallible and human error could result in a significant uninsured loss to the Company.

Meridian’s officers and directors may have potential conflicts of interest

Meridian’s directors and officers may serve as directors and/or officers of other public and private companies and devote a portion of their time to manage other business interests. This may result in certain conflicts of interest. To the extent that such other companies may participate in ventures in which the Company is also participating, such directors and officers may have a conflict of interest in negotiating and reaching an agreement with respect to the extent of each company’s participation. However, applicable law requires the directors and officers to act honestly, in good faith, and in the best interests of the Company and its shareholders and in the case of directors, to refrain from participating in the relevant decision in certain circumstances.

Risks associated with the Agreements with the Cooperatives

The Company's interests in its principal properties in Brazil will be subject to the risks normally associated with the conduct of jointly owned operations. The existence or occurrence of one or more of the following circumstances and events could have a material adverse impact on the Company's financial position or the viability of its interests in the Bom Futuro Joint Venture, which could have a material adverse impact on the Company's business prospects, results of operations and financial condition: (i) disagreements with the Cooperatives or other partners on how to conduct exploration, development or mining activities; (ii) inability of the Company or its partner to meet their obligations to the joint venture or third parties; and (iii) disputes or litigation regarding budgets, development activities, reporting requirements and other matters.

Operations in Brazil and Regulatory Requirements

The Company's principal properties are located in Brazil and mineral exploration and mining activities may be affected in varying degrees by changes in political, social and financial stability, inflation and changes in government regulations relating

Management's Discussion and Analysis

to the mining industry. Any changes in regulations or shifts in political, social or financial conditions are beyond the control of the Company and may adversely affect its business. Operations may be affected in varying degrees by government regulations with respect to restrictions on production, price controls, export controls, income taxes, expropriation of property, environmental legislation, and mine safety. Brazil's status as a developing country may make it more difficult for the Company to obtain any financing required for the exploration and development of its properties due to real or perceived increased investment risk. Since January 1996, there are no restrictions on the repatriation from Brazil on the earnings of foreign entities, provided that the foreign investments are duly registered before the Central Bank of Brazil. Capital investments registered with the Central Bank in Brazil may similarly be repatriated. The only restrictions to repatriation on the earnings/dividends of foreign entities deriving from Brazilian invested companies are in the cases of subscribed capital not fully paid in by the foreign investor, or in case the Brazilian invested company has accumulated losses registered in its balance sheet. In any case, there can be no assurance that restrictions on repatriation of earnings and capital investments from Brazil will not be imposed in the future.

Permits, licenses and approvals

In countries where Meridian carries out exploration activities, the mineral rights or certain portions of them are owned by the relevant governments. These governments have entered into contracts with Meridian or granted permits or concessions that allow it to carry out operations or development and exploration activities there, but government policy could change. Any change that affects Meridian's rights to conduct these activities could have a material and adverse effect on the Company.

In addition, mineral exploration and mining activities can only be conducted by entities that have obtained or renewed exploration or mining permits and licenses in accordance with the relevant mining laws and regulations. The duration and success of each permitting effort are contingent upon many factors we do not control. In the case of foreign operations, government approvals, licenses and permits are, as a practical matter, subject to the discretion of the applicable governments or governmental officials. There may be delays in the review process. There is no guarantee that we will be granted the necessary permits and licenses, that they will be renewed, or that we will be in a position to comply with all conditions that are imposed.

All mining projects require a wide range of permits, licenses and government approvals and consents. It is not certain that Meridian will be granted these at all, or in a timely manner. If it does not receive them for its mineral projects or are unable to maintain them, it could have a material and adverse effect on the Company.

Risks Inherent in Acquisitions

The Company may actively pursue the acquisition of exploration, development and production assets consistent with its acquisition and growth strategy. From time to time, the Company may also acquire securities of or other interests in companies with respect to which it may enter into acquisitions or other transactions. Acquisition transactions involve inherent risks, including but not limited to: accurately assessing the value, strengths, weaknesses, contingent and other liabilities and potential profitability of acquisition candidates; ability to achieve identified and anticipated operating and financial synergies; unanticipated costs; diversion of management attention from existing business; potential loss of the Company's key employees or key employees of any business acquired; unanticipated changes in business, industry or general economic conditions that affect the assumptions underlying the acquisition; and decline in the value of acquired properties, companies or securities. Additionally, the legal form of these acquisitions may result in the Company becoming liable for the historical operations of the acquisition.

To acquire properties and companies, the Company may be required to use available cash, incur debt, issue additional Common Shares or other securities, or a combination of any one or more of these. This could affect the Company's future flexibility and ability to raise capital, to explore, develop and operate its properties and could dilute existing shareholders and decrease the trading price of the Common Shares. There is no assurance that when evaluating a possible acquisition, the Company will correctly identify and manage the risks and costs inherent in the business to be acquired. There may be no right for the Company shareholders to evaluate the merits or risks of any future acquisition undertaken by the Company, except as required by applicable laws and regulations.

Coronavirus (COVID-19) pandemic

The current outbreak of novel Coronavirus (COVID-19) and any future emergence and spread of similar pathogens may have the potential to cause severe impact on global economy and market dislocation, which may adversely impact the Company's operations, its suppliers, contractors and service providers' operations, the ability to obtain financing and maintain necessary

Management's Discussion and Analysis

liquidity, and the ability to explore the Company's properties. The outbreak and all the measures being taken in response to COVID-19 have generated an unprecedented level of uncertainty globally causing significant volatility in commodity prices. Governments worldwide, including the Canadian, Brazilian and UK governments, enacted extraordinary acts and measures to limit spread of the virus which included restrictions such as quarantines, business closures and travel restrictions. While these effects are expected to be temporary, the situation is dynamic, and all business disruptions and related financial impacts cannot be reasonably estimated at this time.

The Company cannot estimate what will be the extent of this outbreak and the potential financial and material impact on the Company since travel restrictions and other government measures may also adversely impact the Company's exploration, the ability of the Company to advance its projects and to obtain financing and maintain necessary liquidity.

Other Requirements

Additional information relating to the Company is available on SEDAR at www.sedar.com and on the Company's website www.meridianmining.co.

Note Regarding Forward-Looking Statements

Except for historical information, this MD&A contains forward-looking statements. These statements involve known and unknown risks, uncertainties, and other factors that may cause the Company's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievement expressed or implied by these forward-looking statements.

The factors that could cause actual results to differ materially include, but are not limited to, the following: Meridian has no assurance that all necessary permits will be issued nor if issued, that they will be issued in a timely manner, Meridian has no assurance that the ownership of licenses will not be subject to prior claims, agreements or transfers and that the rights of ownership will not be challenged or affected by undetected defects, general economic conditions; changes in financial markets; the impact of exchange rates; political conditions and developments in countries in which the Company operates; changes in the supply, demand and pricing of the metal commodities which the Company hopes to find and successfully mine; changes in regulatory requirements impacting the Company's operations; the sufficiency of current working capital and the estimated cost and availability of funding for the continued exploration and development of the Company's exploration properties.

This list is not exhaustive and these and other factors should be considered carefully, and readers should not place undue reliance on the Company's forward-looking statements. As a result of the foregoing and other factors, no assurance can be given as to any such future results, levels of activity or achievements and neither the Company nor any other person assumes responsibility for the accuracy and completeness of these forward-looking statements.

This MD&A contains certain forward-looking statements inclusive of, but not limited to, the agreements with the Cooperatives, the production arrangements and the timing of the mine development. Although forward-looking statements and information contained in this MD&A are based on the beliefs of Meridian management, which we consider to be reasonable, as well as assumptions made by and information currently available to Meridian management, there is no assurance that the forward-looking statement or information will prove to be accurate. The assumptions made include assumptions about Meridian's ability to move forward with the arrangements. The forward-looking statements and information contained in this MD&A are subject to current risks, uncertainties and assumptions related to certain factors including, without limitations, obtaining all necessary approvals, feasibility of mine and plant development, exploration and development risks, expenditure and financing requirements, title matters, operating hazards, metal prices, political and economic factors, competitive factors, general economic conditions, relationships with vendors and strategic partners, governmental regulation and supervision, seasonality, technological change, industry practices, and one-time events as well as risks, uncertainties and other factors discussed in our quarterly and annual management's discussion and analysis. Should any one or more of these risks or uncertainties materialize or change, or should any underlying assumptions prove incorrect, actual results and forward-looking statements and information may vary materially from those described herein. Accordingly, readers should not place undue reliance on forward-looking statements and information contained in this MD&A. We undertake no obligation to update forward-looking statements or information except as required by law.

AI assistant

Meridian Mining — Management Reports 2020

47387_rns_2020-04-29_d32b6600-8fa0-4255-8bd9-f3092d1b6ef4.pdf

FORM 51-102F1

Introduction

Business Overview

Strategy

Corporate Outlook

Performance Summary for the year ended December 31, 2019

Corporate Highlights

Operational Highlights

Sales Highlights

Exploration Highlights

Environmental Highlights

Subsequent Events

Corporate Highlights

Debt Conversion Agreement between Meridian and Sentient

Consolidated Facility Agreement between Meridian and Sentient

Royalty Purchase and Debt Settlement Agreement and Net Smelter Royalty Agreement between Cancana and Sentient

Exploration Highlights

Espigão Project

Background

Espigão Polymetallic Potential

Manganese Exploration and Mining

Mineral Processing and Metallurgical Testing

Mirante da Serra Project, Rondônia, Brazil

Background

Geology and Mineralization Model

Exploration

Permitting, Corporate Social Responsibility and Environment

Ariquemes Tin Project, Rondônia, Brazil

Background

Selected Annual Information:

Quarterly Financial Summary:

Discussion of Fourth Quarter Results:

Discussion of Annual Results

Liquidity and Capital Management

Debt facilities

Related Party Transactions

Share Capital

Outstanding Share Data

Stock Options and Warrants

Critical Accounting Estimates

Mineral Production

Deferred taxes

Impairment of property, plant and equipment, and goodwill

Share based compensation and mark-to-market revaluation of warrants

Critical management judgments:

Mineral Production, depreciation and depletion

Valuation of exploration and evaluation assets

New and revised standards and interpretations

Contractual Obligations

Off-Balance Sheet Arrangements

Proposed Transactions

Contingencies

Buffer Zone

Risk Factors

Meridian will require additional funding

Meridian is subject to government regulation

Exploration, development and mining activities can be hazardous and involve a high degree of risk

Meridian may be adversely affected by fluctuations in manganese and other metal prices

Infrastructure

Meridian does not and likely will not insure against all risks

Meridian is dependent on key personnel

Meridian’s officers and directors may have potential conflicts of interest

Risks associated with the Agreements with the Cooperatives

Operations in Brazil and Regulatory Requirements

Permits, licenses and approvals

Risks Inherent in Acquisitions

Coronavirus (COVID-19) pandemic

Other Requirements

Note Regarding Forward-Looking Statements

More from Meridian Mining

Meridian Mining Management Reports 2020