PACIFIC BAY MINERALS LTD.

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(the “Company” or “Pacific Bay”)

FORM 51-102F1 MANAGEMENT DISCUSSION AND ANALYSIS FOR THE YEAR ENDED DECEMBER 31, 2020

The following management discussion and analysis (“MD&A”) has been prepared by management as of April 30, 2021, and should be read in conjunction with the audited consolidated financial statements of the Company and related notes for the year ended December 31, 2020. The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). All amounts are stated in Canadian dollars unless otherwise indicated.

FORWARD LOOKING STATEMENTS

This MD&A contains certain forward-looking information and statements. These forward-looking statements are based on current expectations and various estimates, factors and assumptions as at the date of this MD&A. The words “expects”, “plans”, “anticipates”, “believes”, “intends”, “estimates”, “projects”, “potential”, “interprets”, “may”, “will” and similar expressions identify forward-looking statements. Information concerning the interpretation of drill results may also be considered a forward-looking statement; as such information constitutes a prediction of what mineralization might be found to be present if and when a project is actually developed. The forward-looking statements reflect the current beliefs of the management of the Company, and are based on currently available information. Readers are cautioned not to place undue reliance on these statements as they are subject to known and unknown risks, uncertainties and other factors, which could cause the actual results, performance, or achievements of the Company to differ materially from those expressed in, or implied by, such forward-looking statements. The Company assumes no obligation to update or revise any forward-looking statement, whether as a result of new information, future events or any other reason.

OVERVIEW

Pacific Bay Minerals Ltd. (the "Company") was incorporated under the laws of British Columbia, Canada and maintains its head and registered office at Suite 120, 601 West Cordova Street, Vancouver, British Columbia, Canada, V6B 1G1. The Company is primarily engaged in the acquisition, exploration, and development of mineral properties in Canada. The Company is listed on the TSX Venture Exchange (TSX-V) under the symbol “PBM” as a Tier 2 mining issuer.

Key activities of fiscal 2020

 On September 17, 2020, the Company appointed Sebastien Ah Fat, P.Geo, as Vice President of Exploration, Antonio Vespa, P.Eng., as Vice President of Operations, and Helder Carvalho, B. Comm., as Vice President of Corporate Development.

On September 24, 2020, the Company announced that Mr. William H. Smith, QC, was appointed to the Board of Directors of the Company.
On November 27, 2020, the Company announced that Mr. Antonio Vespa, P.Eng., was appointed to the Board of Directors of the Company.
On December 7, 2020, the Company completed a private placement of 1,886,800 flow-through units at a price of $0.175 per flow-through unit and 290,000 non-flow-through units at a price of $0.125 per non-flow-through unit for gross proceeds of $366,440.

Impact of Covid-19

In March 2020 the World Health Organization declared the outbreak of the novel coronavirus (“COVID-19”) a global pandemic. This contagious disease outbreak, which has continued to spread, and any related adverse public health developments, has adversely affected workforces, economies, and financial markets globally, potentially leading to an economic downturn. As at December 31, 2020, we have not observed any material impairments of our assets or a significant change in the fair value of assets, due to the COVID-19 pandemic. The situation is dynamic and the ultimate duration and magnitude of the impact of the outbreak on the economy and its financial effect on the Company’s business, financial position, and operating results remain unknown at this time. These impacts could include the ability of the Company to raise capital or the impairment in the value of the Company’s long-lived assets. The Company is closely monitoring the impact of the pandemic on all aspects of its business and adapting its business plans accordingly.

EXPLORATION ACTIVITIES

Haskins-Reed Property, British Columbia

The Company owns a 100% interest in the Haskins-Reed property located in the Cassiar Mining District of North Central British Columbia. The property, situated just off Highway 37, on Mount Haskins and Mount Reed, hosts numerous skarn, replacement and porphyry-style mineral occurrences.

During 2008, the Company completed an airborne geophysical survey of the Haskins-Reed Property which revealed numerous anomalies, the most important of which is a major, NE/SW trending magnetic anomaly in parallel to previous skarn and intrusive hosted mineralization. Ground follow up of the anomaly discovered a new showing called the Mee.

In June 2009, the Company completed a trenching, soil sampling and geological exploration program at the Haskins-Reed Property. During the year ended December 31, 2010, excavator trenching was completed which outlined a significant new zone of silver, lead, zinc and minor gold mineralization located on the Crown Grants.

During 2011, diamond drilling and trenching program was completed on the Property with significant intercepts of mineralization encountered. The diamond drilling program completed 11 diamond drillholes totalling 1,261 metres targeting the Meteor, L303, Boot, and B-Zone zones. The B-Zone illustrated high grade intercepts of zinc and silver, which included drillhole 11BZ-10 with an intercept of 13.95 metre core length grading 102.59 g/t silver and 4.96% zinc. The Meteor zone also returned high grade intercepts of silver and zinc, which included drillhole 11MZ-07 with an intercept of 17.5 metre core length grading 88.35 g/t silver and 3.39% zinc. The trenching program completed 214 metres focusing on the Meteor zone and successfully exposed the zone at surface with mineralized widths between 4 and 16 metres.

	Hole ID	From	To	Total	Silver	Lead	Zinc	Copper	Bismuth	Molybdenum
		(m)	(m)	core (m)	(g/t)	(%)	(%)	(%)	(%)	(%)

11MZ-05	23.9	30.6	4.45			6.7
11MZ-07	4.85	22.35	17.5	88.35	1.11	3.39
11MZ-08	5.1	13.9	8.8	51.05		2.51
11BZ-09	196.3	199.4	3.1	90.6		7.1	0.49	0.53
11BZ-09	205.7	218.95	13.25	18.52			0.41
including	205.7	209.95	4.25					0.22
11BZ-10	182.1	196.05	13.95	102.59		4.96	0.52	0.29
including	193.25	196.05	2.8						0.0018
		2011 Diamond Drilling Program Significant Results

In 2014, the company completed a 6-hole diamond drilling program totalling 409 metres targeting the Brett Zone. The drilling program successfully encountered zinc and magnetite mineralization in 5 of 6 drillholes. Drilling results included an intercept of 9.70 metres core length grading 7.265% zinc from drillhole 14-02.

Hole ID	From(m)	To(m)	Length(m)	Zn(%)	Cu(%)	W(%)	Bi(%)
14-02	15.8	64.4	48.6	2.31
including	15.8	29.5	13.7	2.33
including	54.7	64.4	9.7	7.27
14-03	9.5	39.9	30.4	1.47
including	9.5	20.1	10.6	2.35
14-03	29.7	39.9	10.2	1.92	0.21	0.15	0.04
14-05	10.2	36.2	26	1.08
including	10.2	22.2	12	1.43
14-06	10.5	50	39.5	1.48
including	10.5	31.75	21.25	1.6
including	25.4	29.75	4.35	6.21
including	36	50	14	1.74

2014 Diamond Drilling Significant Results

Owing to the risks associated with difficult market conditions and the related difficulty in raising capital, the Company recognized an impairment charge of $269,803 during the year ended December 31, 2017.

In September 2018, the Company conducted a diamond drill program, using a low-impact, highly portable rig to test targets near the Meteor Zone, where 2011 drill hole 11MZ-07 encountered 17.5 metres grading 88.35 g/t silver, 1.11% lead and 3.39% zinc. A total of 7 drillholes totalling 448.2 metres of drilling were completed for the 2018 season. Details of the drilling results can be found in the Company’s news release on January 25, 2019.

Hole ID	From	To	Interval	Ag	Pb	Zn	Cu	Bi
	(m)	(m)	(m)	(g/t)	(%)	(%)	(%)	(%)
18MZ-01	32.3	33.5	1.2	40.1	0.459	1.795	0.038	0.022
18MZ-02	37.25	39.8	2.55	11.57	0.117	2.944	0.027	0.005
18MZ-03	6.5	11.7	5.2	35.83	0.683	6.204	0.206	0.011
18MZ-04	13.3	13.9	0.6	32.3	0.093	8.55	0.147	0.236
18MZ-04	19.8	23.2	3.4	45.91	2.69	2.195	0.113	0.007
18MZ-06	14.1	16.3	2.2	148.36	4.789	6.752	0.352	0.033
18MZ-06	22.9	24.2	1.3	76.4	1.495	2.14	0.123	0.017
18MZ-07	11.8	17.9	6.1	56.54	1.896	2.637	0.159	0.019

18MZ-07 21.8 22.6 0.8 157 1.19 4.32 0.725 0.04 2018 Diamond Drilling Significant Results

No new field work was conducted during fiscal 2019 due to lack of funding. The Company expanded the HaskinsReed Property by approximately 20% via staking several additional mineral claims covering prospective areas that had previously been held by other parties but allowed to lapse.

Management is confident that the Haskins-Reed Property remains a property of significant merit with excellent exploration potential and is seeking to fund further exploration through equity financing or through partnerships with other mining companies.

Management is actively evaluating exploration opportunities at the Haskins-Reed property and seeking to fund exploration activities through equity financing or joint venture partners. The Company has a notice of work permit in good standing allowing for exploration activities to continue in the near term.

Weaver Lake (formerly Lode Gold) Property, British Columbia

On February 25, 2014, the Company entered into an option agreement to acquire a 100% interest in the Weaver Lake claims located in the New Westminster Mining Division of British Columbia. The Weaver Lake Gold property, approximately 1.5 hours drive from Vancouver, is accessible via highway and all weather roads and can be worked on year-round. On January 18, 2018, the Company made the final option payment and acquired a 100% interest in the property.

The Weaver Lake Gold property hosts a quartz stock-work style hydrothermal gold prospect with a history of exploration, including an underground workings and a number of drilling campaigns. A 1996 seven-hole diamond drilling program on the Weaver Lake Gold property reportedly intersected significant gold mineralization, including 8.61 g/t Au and 46.2 g/t Ag over a drilling interval of 3.05 metres and 4.68 g/t Au and 383.7 g/t Ag over a drilling interval of 6.10 metres.

In October 2018, the Company completed two diamond drillholes at its Weaver Lake Gold property. The drillholes targeted a previously identified high grade gold bearing quartz vein. On August 12, 2019, the Company reported the first drillhole returned assays of 2 g/t gold and 13.71 g/t silver over 4.61 metres. The second drillhole returned no significant assays. No new additional exploration work was carried out in 2019 and 2020 due to a lack of funds and a prioritization of the available funds on the Haskins-Reed Property. Management is evaluating strategic options for the Weaver Lake Property.

Wheaton Creek (formerly Boulder) Gold Property, British Columbia

On February 25, 2014, the Company entered into an option agreement to acquire a 100% interest in the Wheaton Creek claims located in the Stikine Mining Division of British Columbia. On April 5, 2018, the Company made the final option payment and acquired a 100% interest in the property.

During the 2014 season, the Company completed a 246-metre diamond drill hole at its 100% optioned Wheaton Creek Gold Property. The drill hole was collared on weakly pyritized clastic metasedimentary rocks exposed by recent placer gold mining. The lower half of the drill hole encountered highly-altered, quartz-veined and sulphiderich metasedimentary rocks. Results of this drilling yielded no significant mineralization. No field work was carried out in 2019 and 2020 due to a lack of funds and a prioritization of the available funds on the Haskins-Reed Property. However, certain expenditures were incurred in the preparation and filing of permits to enable the Company complete a drill program recommended by the Company’s geologist.

Management plans to explore the Wheaton Creek Property in 2021. A diamond drilling program has been planned to follow-up on the 1986 diamond drillhole, 86-01, that intercepted 5.38 g/t gold over a 3.0-metre core length.

Qualified Person

The technical contents in this document have been reviewed and approved by Sebastien Ah Fat, P.Geo., a qualified person as defined by National Instrument (NI) 43-101.

SELECTED ANNUAL INFORMATION

The following table sets out selected financial information for the Company which has been derived from the Company’s audited financial statements for the fiscal years ended December 31, 2020, 2019, and 2018.

	Fiscal 2020($)	Fiscal 2019($)	Fiscal 2018($)

Revenues	-	-	-
Net income(loss)	(400,236)	(147,058)	(87,612)

Net loss (loss) per share - basic and diluted	(0.03)	(0.01)	(0.01)

Total assets	1,030,946	695,254	748,381
Total non-current liabilities	30,303	-	-
Dividends	-	-	-

Factors That Affect the Comparability of the Annual Financial Data Disclosed Above

Net losses for the years ended December 31, 2020, 2019, and 2018 were $400,236, $147,058, and $87,612, respectively. The increase in net loss for 2020 was mainly due to share-based payment expenses (2020 - $243,159, 2019 - $nil, 2018 - $nil). In fiscal 2018, the Company realized a gain of $50,000 from sale of net smelter return royalty. The general operating expenses excluding share-based payment expenses (2020 - $169,251, 2019 - $165,161, 2018 - $186,178) were generally consistent for the last three years. The increase in total assets in 2020 was a result of a private placement financing completed in December 2020.

DISCUSSION OF OPERATIONS

Pacific Bay is an exploration stage company and has no operating revenue. Expenditures related to exploration and evaluation assets are capitalized and a breakdown is provided in Note 6 to the consolidated financial statements. During the year ended December 31, 2020, the Company incurred $1,473 (2019 - $nil) in acquisition costs and property claim maintenance costs and $641 (2019 - $13,478) in exploration expenditures.

During the year ended December 31, 2020, the Company reported a net loss of $400,236 compared to a net loss of $147,058 incurred in the year ended December 31, 2019. The loss in the 2020 period relates primarily to general operating expenses of $412,410 (2019 - $165,161).

The general operating expenses excluding share-based payment expenses for fiscal 2020 were $169,251 (2019 - $165,161) and were generally consistent with the 2019 comparative period. Some of the significant general operating expense items are summarized as follows:

Accounting and audit of $21,300 (2019 - $32,700) relate to audit, accounting and tax compliance work carried out.
Consulting fees of $30,000 (2019 - $30,042) include mainly fees to the Company’s Chief Financial Officer.
Management fees of $81,000 (2019 - $72,000) relate to fees to the Chief Executive Officer, a director and three officers of the Company.

Share-based payment expenses of $243,159 (2019 - $nil), a non-cash charge, are the estimated fair value of stock options granted during the year. The Company used the Black-Scholes option pricing model for the fair value calculation.

SUMMARY OF QUARTERLY RESULTS

The following table sets forth selected unaudited consolidated financial information for the Company’s eight most recent quarters ending with the last quarter for the three month period ended December 31, 2020.

		For the Three Months Ended	For the Three Months Ended	For the Three Months Ended	For the Three Months Ended	For the Three Months Ended
		Fiscal 2020				Fiscal	2019
	Dec. 31, 2020	Sept. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2019	Sept. 30, 2019	Jun. 30, 2019	Mar. 31, 2019
	($)	($)	($)	($)	($)	($)	($)	($)

Total revenues	-	-	-	-	-	-	-	-
Net income(loss)	(54,435)	(277,952)	(31,095)	(36,754)	(30,388)	(41,204)	(42,260)	(33,206)

Net income (loss) per share - basic and diluted	(0.00)	(0.02)	(0.00)	(0.00)	(0.00)	(0.00)	(0.00)	(0.00)

FOURTH QUARTER

In the fourth quarter ended December 31, 2020, the Company realized net loss of $54,435 (2019 - $30,388). The current period’s loss was mainly related to general operating expenses of $54,435 (2019 - $48,412). The increase in general operating expenses over the comparative period is mainly due to the increased financing and corporate activities during the fourth quarter of 2020. Factors affecting the results for the current quarter are similar to those explained under the “Discussion of Operations” Section.

LIQUIDITY AND CAPITAL RESOURCES

During the year ended December 31, 2020, the cash balance increased by $339,309 (2019 - $60,949). The Company spent $43,401 (2019 - $18,956) in operating activities and $3,117 (2019 - $42,535) on its exploration assets. The Company received $330,326 of net proceeds from a private placement financing, $6,250 from share subscriptions, $40,000 of loan proceeds from the Canadian Government and $9,251 of advances from related parties.

As at December 31, 2020, the Company had a cash balance of $339,561 compared to $252 as at December 31, 2019. The Company had working capital deficiency of $638,769 as at December 31, 2020 compared to working capital deficiency of $752,611 as at December 31, 2019.

At present, the Company does not have sufficient capital resources to pay for its operating expense for the next 12 months. Subsequent to December 31, 2020, the Company completed the final tranche of a private placement of 286,000 non-flow-through units at a price of $0.125 per non-flow-through unit for gross proceeds of $35,750. The Company anticipates completing an equity financing to meet its anticipated operating and capital requirements for the next 12 months.

Going Concern

At present, the Company’s operations do not generate cash flow and its financial success is dependent on management’s ability to continue to raise adequate financing on reasonable terms and to commence profitable operations in the future. The aforementioned factors indicate the existence of a material uncertainty which may cast

significant doubt about the Company’s ability to continue as a going concern. Should the Company be unable to realize its assets and discharge its liabilities in the normal course of business, the net realizable value of its assets may be materially less than the amounts recorded on the statements of financial position. The Company’s consolidated financial statements do not include adjustments that would be necessary should the Company be unable to continue as a going concern. These adjustments could be material.

OFF-BALANCE SHEET ARRANGEMENTS

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

RELATED PARTY TRANSACTIONS

		2020	2019
Amounts due torelated parties
David H. Brett, President and CEO	$	216,992 $	234,223
Guilford H. Brett, Director and Chairman		196,720	190,789
Leanora Brett, CFO		89,224	61,224
Sebastien Ah Fat, VP Exploration		34,000	-
Antonio Vespa, Director and VP Operations		34,000	-
HelderCarvalho, VPCorporateDevelopment		34,000	-
	$	604,936 $	486,236
Loans payable torelated parties
Guilford H. Brett, Director and Chairman	$	102,935 $	101,397
David H. Brett, President and CEO		5,951	396
Leanora Brett, CFO		2,158	-
AlanQiao, a significant shareholder		4,000	4,000
	$	115,044$	105,793

Amounts due to related parties are for accrued management fees and loan interest and are unsecured, non-interest bearing, and have no specific terms of repayment. During the year ended December 31, 2019, the Company completed debt settlements to settle $190,000 of amounts due to related parties and $221,500 of loans payable to related parties in shares. During the year ended December 31, 2020, the President and CEO of the Company and a director of the Company assigned amounts due to them totalling $75,000 equally between the Vice President of Exploration of the Company, the Director and Vice President of Operations and the Vice President of Corporate Development.

At December 31, 2020, a total of $22,927 (2019 - $22,927) owing to companies controlled by a significant shareholder of the Company is included in trade and other payables.

Included in loans payable to related parties is a loan of $85,000 from Guilford H. Brett, which is unsecured and bears interest at 7% per annum. As at December 31, 2020, the accrued interest on the loan was $78,552 (December 31, 2019 - $67,852). The repayment date of the loan has been extended to December 31, 2021. The remaining loans payable to related parties are advances from related parties and are unsecured, non-interest bearing, and have no specific terms of repayment.

Key management personnel include directors (executive and non-executive) and officers of the Company. The compensation paid or payable to key management personnel during the years ended December 31 is as follows:

	2020 2019
Management fees Consulting fees Share-based payments	$ 81,000 $ 72,000 30,000 30,000 243,159 -
Total	$ 354,159$ 102,000

The Company entered into the following transactions with related parties during the year ended December 31, 2020:

a) Paid or accrued management fees of $54,000 (2019 - $72,000) to the President of the Company and a director of the Company for management services provided.
b) Paid or accrued consulting fees of $30,000 (2019 - $30,000) to the CFO of the Company for corporate consulting services provided.
c) Paid or accrued management fees of $27,000 (2019 - $nil) to three officers of the Company for management services provided.
d) Paid or accrued loan interest of $10,700 (2019 - $10,000) to a director of the Company related to an interestbearing loan.

The Company has entered into an agreement with three officers of the Company for operation and geological services for a monthly fee of $3,000, plus applicable taxes, each. The monthly fees for each officer will increase at a rate of $1,000 per year to a maximum of $7,000 per month.

SUMMARY OF OUTSTANDING SHARE DATA

The Company’s issued and outstanding share capital as at the date of this report is as follows:

(1) Authorized: unlimited number of common shares with no par value.

(2) As at April 30, 2021, the Company has 16,900,711 common shares, 1,400,000 stock options and 2,604,676 warrants issued and outstanding.

CRITICAL ACCOUNTING ESTIMATES

The preparation of the consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and reported amounts of expenses during the period. Actual results could differ from these estimates. The Company’s management reviews these estimates and underlying assumptions on an ongoing basis, based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Revisions to estimates are adjusted for prospectively in the period in which the estimates are revised. Significant areas requiring the use of management estimates include:

i) The determination of the fair value of share-based payments, including stock options and finders’ warrants, using stock option pricing models, require the input of highly subjective assumptions, including the expected share price volatility. Changes in the subjective input assumptions could materially affect the fair value estimate.

ii) The determination of deferred income tax assets or liabilities requires subjective assumptions regarding future income tax rates and the likelihood of utilizing tax carry-forwards. Changes in these assumptions could materially affect the recorded amounts, and therefore do not necessarily provide certainty as to their recorded values.

CHANGES IN ACCOUNTING POLICIES INCLUDING INITIAL ADOPTION

New accounting policies

There were no new or amended IFRS pronouncements effective January 1, 2020 that impacted the Company’s consolidated financial statements.

FINANCIAL INSTRUMENTS

The Company classified its financial instruments as follows: cash, trade and other payables, loan payable, amounts due to related parties and loans payable to related parties are measured at amortized cost.

The carrying amount of cash, trade and other payables, amounts due to related parties, and loans payable to related parties carried at amortized cost is a reasonable approximation of fair value due to the relatively short period to maturity of these financial instruments and/or the rate of interest being charged.

Financial risk management

The Company’s financial risks arising from its financial instruments are credit risk, liquidity risk, and interest rate risk. The Company’s exposures to these risks and the policies on how to mitigate these risks are set out below. Management manages and monitors these exposures to ensure appropriate measures are implemented on a timely and effective manner.

Credit risk

Credit risk is the risk of potential loss to the Company if the counter party to a financial instrument fails to meet its contractual obligations. The credit risk of the Company is associated with cash. The credit risk with respect to its cash is minimal as they are held with high-credit quality financial institutions.

Liquidity risk

Liquidity risk is the risk that the Company will not meet its obligations associated with its financial liabilities as they fall due. The Company performs cash flow forecasting for each fiscal year to ensure sufficient cash is available to fund its projects and operations. As at December 31, 2020, the Company had a cash balance of $339,561 and current liabilities of $979,735. The Company’s financial liabilities include accrued expenses and trade and other payables which have contractual maturities of 30 days or are due on demand.

At present, the Company’s operations do not generate positive cash flows. The Company's primary source of funding has been the issuance of equity securities through private placements and related party loans. Despite previous success in acquiring these financings, there is no guarantee of obtaining future financings.

Interest rate risk

The Company is exposed to interest rate risk arising from the cash maintained at Canadian financial institutions. The interest rate risk on cash is not considered significant due to their short-term nature and maturity.

RISK AND UNCERTAINTIES

Operating Hazards and Risks

Mineral exploration involves many risks. The operations in which the Company has a direct or indirect interest will be subject to all the hazards and risks normally incidental to exploration, any of which could result in work stoppages and damage to persons or property or the environment and possible legal liability for any and all damage. Fires, power outages, labour disruptions, flooding, landslides and the inability to obtain suitable or adequate machinery, equipment or labour are some of the risks involved in the conduct of exploration programs.

Environmental Factors

The Company currently conducts exploration activities in the Canadian Province of British Columbia. Such activities are subject to various laws, rules and regulations governing the protection of the environment. In Canada, extensive environmental legislation has been enacted by federal and provincial governments. Such legislation imposes rigorous standards on the mining industry to reduce or eliminate the effects of waste generated by extraction and processing operations and subsequently deposited on the ground or emitted into the air or water.

All phases of the Company’s operations are subject to environmental regulation in the jurisdictions in which it operates. Environmental legislation is evolving in a manner which requires stricter standards and enforcement, increased fines and penalties for non-compliance, more stringent environmental assessments of proposed properties and a heightened degree of responsibility for companies and their officers, directors and employees. There is no assurance that future changes in environmental regulation, if any, will not adversely affect the Company’s operations. The cost of compliance with changes in governmental regulations has the potential to preclude entirely the economic development of a property.

The Company is able to conduct its exploration within the provisions of the applicable environmental legislation without undue constraint on its ability to carry on efficient operations. The estimated annual cost of environmental compliance for all properties held by the Company in the exploration stage is minimal and pertains primarily to carrying out diamond drilling, trenching or stripping. Environmental hazards may exist on the Company’s properties, which hazards are unknown to the Company at present, which have been caused by previous or existing owners or operators of the properties.

Governmental Regulation

Exploration activities on the Company’s properties are affected to varying degrees by: (i) government regulations relating to such matters as environmental protection, health, safety and labour; (ii) mining law reform; (iii) restrictions on production, price controls, and tax increases; (iv) maintenance of claims; (v) tenure; and (vi) expropriation of property. There is no assurance that future changes in such regulation, if any, will not adversely affect the Company’s operations. Changes in such regulation could result in additional expenses and capital expenditures, restrictions on the availability of capital, competition, reserve uncertainty, potential conflicts of interest, title risks, dilution, and restrictions and delays in operations, the extent of which cannot be predicted.

The Company is at the exploration stage on all of its properties. Exploration on the Company’s properties requires responsible best exploration practices to comply with company policy, government regulations, maintenance of claims and tenure. The Company is required to be registered to do business and have a valid prospecting license (required to prospect or explore for minerals on Crown Mineral Land or to stake a claim) in any Canadian province in which it is carrying out work.

Mineral exploration primarily falls under provincial jurisdiction. However, the Company is also required to follow the regulations pertaining to the mineral exploration industry that fall under federal jurisdiction, such as the Fish and Wildlife Act.

If any of the Company’s projects are advanced to the development stage, those operations will also be subject to various laws and regulations concerning development, production, taxes, labour standards, environmental protection, mine safety and other matters.

OUTLOOK

The Company’s management has instituted a strict cost control program to ensure its ability to continue as a going concern. The Company will undertake additional exploration work on its mineral properties and also continue to evaluate new prospects and opportunities.

DISCLOSURE CONTROLS

In connection with Exemption Orders issued by each of the securities commissions across Canada, the Chief Executive Officer and Chief Financial Officer of the Company will file a Venture Issuer Basic Certificate with respect to the financial information contained in the audited annual consolidated financial statements and respective accompanying Management’s Discussion and Analysis.

In contrast to the certificates under National Instrument (“NI”) 52-109 (Certification of disclosure in an Issuer’s Annual and Interim Filings), the Venture Issuer Basic Certification does not include representations relating to the establishment and maintenance of disclosure controls and procedures and internal control over financial reporting as defined in NI 52-109.

ADDITIONAL DISCLOSURE FOR VENTURE ISSUERS WITHOUT SIGNIFICANT REVENUE

During the year ended December 31, 2020, the Company incurred claim staking costs of $1,473 and geological consulting fees of $641.

ADDITIONAL INFORMATION

Additional information concerning the Company and its operations is available on SEDAR at www.sedar.com and on the Company web site at www.pacificbayminerals.com.

APPROVAL

The Board of Directors of Pacific Bay Minerals Ltd. has approved the contents of this management discussion and analysis on April 30, 2021.

AI assistant

PACIFIC BAY MINERALS LTD. Management Reports 2021

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