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Pacific Ridge Exploration Ltd. Management Reports 2025
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Management Reports
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PACIFIC RIDGE
exploration Ltd.
(An Exploration Stage Company)
Management's Discussion and Analysis (MD&A)
Six months ended June 30, 2025
PACIFIC RIDGE exploration Ltd.
Management's Discussion and Analysis Six months ended June 30, 2025
This Management's Discussion and Analysis ("MD&A") of Pacific Ridge Exploration Ltd. ("Pacific Ridge" or the "Company"), dated August 19, 2025, provides an update on the Company's business activities, financial condition, financial performance, and cash flows for the six months ended June 30, 2025, and to the date of this MD&A. The Company's condensed interim consolidated financial statements have been prepared in accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board ("IFRS Accounting Standards). The Company's interim period condensed consolidated financial statements are prepared in accordance with International Accounting Standard 34, Interim Financial Reporting ("IAS 34").
Unless otherwise indicated, all figures are expressed in Canadian dollars. The first, second, third and fourth quarters of the Company's fiscal years are referred to as "Q1", "Q2", "Q3", and "Q4" respectively.
The following information should be read in conjunction with the Company's audited consolidated financial statements for the years ended December 31, 2024 and the corresponding annual MD&A, and the condensed interim consolidated financial statements for the six months ended June 30, 2025 (together, the "Financial Statements"), available on the SEDAR+ website at www.sedarplus.ca.
Pacific Ridge's shares are listed on the TSX Venture Exchange under the symbol "PEX", on the Over-the-Counter Venture Markets (OTC-QB) under symbol PEXZF, and on the Frankfurt Stock Exchange (FSE) under the symbol "PQWN". Additional information related to Pacific Ridge is also available on the Company's website at www.pacificridgeexploration.com or on SEDAR+ at www.sedarplus.ca.
FORWARD LOOKING STATEMENTS
This MD&A contains forward-looking statements that are related to the Company's activities and future financial results. The results for the current periods are not necessarily indicative of the results for any future period. The Company cautions investors that any forward-looking statements by the Company are not guarantees of future performance as the mineral exploration business is not without risk and most exploration projects will not become mines. Pacific Ridge is subject to a number of risks and uncertainties due to the nature of its business and the early stage of its exploration projects. A detailed discussion of risks is presented below, under the Risk Factors section.
Pacific Ridge's disclosure of a technical or scientific nature has been reviewed and approved by Gerald G. Carlson, Ph.D., P. Eng., Chairman of the Company, and a Qualified Person under the definition of National Instrument 43-101.
HIGHLIGHTS
- On January 23, 2025, the Company consolidated its outstanding common shares on the basis of ten (10) pre-consolidation shares for one (1) post-consolidation common shares.
- On March 28, 2025, the Company closed the first tranche of its non-brokered private placement by issuing 1,632,430 units at a price of $0.14 per unit and 618,823 critical mineral flow-through units at a price of $0.17 per unit for gross proceeds of $333,740. Each unit consists of one common share of the Company and one share purchase warrant exercisable at $0.20 per share for a period of 3
Page 1 of 11
PACIFIC RIDGE exploration Ltd.
Management's Discussion and Analysis Six months ended June 30, 2025
years. The Company paid cash finders fees of $16,887 and issued 114,020 finders warrants. The finder's warrants are exercisable at $0.20 per warrant for a period of 3 years.
- On June 4, 2025, the Company closed the second tranche of its non-brokered private placement by issuing 15,184,494 units at a price of $0.14 per unit and 3,561,292 critical mineral flow-through units at a price of $0.17 per unit for gross proceeds of $2,731,249. Each unit consists of one common share of the Company and one share purchase warrant exercisable at $0.20 per share for a period of 3 years. The Company paid cash finders fees of $89,153 and issued 362,182 finders warrants. The finder's warrants are exercisable at $0.20 per warrant for a period of 3 years.
- On June 5, 2025, the Company announced that it has entered into an agreement with the Fiore Group ("Fiore") to provide the Company with financial advisory and administrative services. The Company also announced the appointment of Rob McLeod and Ryan Wymark as strategic advisors to the Company.
- On June 27, 2025, the Company announced shareholders approved the appointment of Stacie Jones and Josh Kierce as new independent directors and re-elected prior year directors except for Gary Bashuk. Also, Tally Barmash replaced Arie Page as the Company's Corporate Secretary.
- Subsequent to the quarter, on July 25, the Company announced that the 2025 drill program was underway on the Day target at RDP, with a minimum of 1,500 m of core drilling planned.
- Also subsequent to the quarter, on August 5, the Company announced it's initial mineral resource for KMZ, including 334.1 million tonnes ("Mt") grading 0.33% copper equivalent ("CuEq"), 0.15% copper, 0.26 g/t gold, and 0.95 g/t silver in the Inferred Mineral Resource category, or 2.42 billion pounds CuEq which includes 1.11 billion pounds of copper, 2.74 million ounces of gold and 10.22 million ounces of silver.
-
On August 18, 2025, the Company announced it had entered into an agreement with Red Cloud Securities Inc. ("Red Cloud") to act as sole agent and bookrunner in connection with a best efforts private placement for aggregate gross proceeds of up to $4,000,000 through the sale of the following:
-
Up to 15,000,000 units of the Company ("Units") at a price of $0.20 per Unit for gross proceeds of up to $3,000,000. Each Unit will consist of one common share of the Company and one common share purchase warrant exercisable at a price of $0.28 per warrant, exercisable for a period of 36 months following the date of closing. The Units will be offered for sale pursuant to the Listed Issuer Financing Exemption allowing the shares to be freely tradeable upon closing.
- Up to 4,347,826 flow-through units of the Company ("FT Units") at a price of $0.23 per FT Unit for gross proceeds of up to $1,000,000. Each FT Unit will consist of one common share of the Company to be issued as a flow-through share and one common share purchase warrant exercisable at a price of $0.28 per warrant, exercisable for a period of 36 months following the date of closing.
The Company also grants Red Cloud the option, exercisable in full or in part up to 48 hours prior to the closing, to raise up to an additional $1,000,000 in gross proceeds from the sale of any combination of Units and FT Units at their respective offering prices.
Page 2 of 11
PACIFIC RIDGE exploration Ltd.
Management's Discussion and Analysis Six months ended June 30, 2025
RESOURCE PROPERTIES
Kliyul and Redton, British Columbia
In January 2020, the Company entered into an earn-in property agreement, as amended on April 7, 2020, and on July 22, 2020, with AuRico with respect to the Kliyul and Redton properties. During 2023, the Company reached an agreement with AuRico to acquire a 100% interest in Kliyul and Redton by issuing 1,699,610 common shares to AuRico.
Kliyul is located 50 km southeast of the Kemess mine and 5 km from the Omineca mining road and power line, in one of the most geochemically anomalous areas for copper and gold in the Quesnel Terrane. Kliyul contains several occurrences in the BC Minfile database, including the four major target areas that extend over a 4 km strike length: Kliyul Main Zone ("KMZ") Parrish Hill/Bap Ridge, Ginger/Ginger South and M39. Each target represents an interpreted porphyry centre.
Redton adjoins Northwest Copper Corporation's Kwanika property along its eastern and northern boundary. Redton is road accessible and underlain by the important Hogem Batholith.
Kliyul
In 2020, the Company completed a surface geophysical survey at Kliyul designed to probe the depth-extent of the chargeability and resistivity response related to the Kliyul mineralization, and to evaluate possible vectors to mineralization for a drill test of priority Cu-Au targets.
During August and September of 2021, Pacific Ridge completed 1,544 m of diamond drilling in three holes at Kliyul. All three holes encountered porphyry-style mineralization consisting of pyrite, chalcopyrite and lesser bornite in veins and as disseminations. Logging of the drill core demonstrated a veining sequence characterized by early magnetite-chlorite alteration and veining which is cross-cut by later-stage banded quartz-magnetite veins as well as later generations of quartz+magnetite+chalcopyrite veining. The later stage veining brings in Cu-bearing chalcopyrite+bornite with quartz as well as epidote and/or anhydrite+magnetite. Early magnetite and quartz-magnetite veins are interpreted to represent the higher temperature part of the porphyry system at KMZ. The presence of bornite is also an indication of proximity to the higher temperature core of a porphyry system and may be a positive vector towards the core of KMZ. All are characteristics associated with classic porphyry copper occurrences.
Pacific Ridge's 2021 drill program produced the longest and highest-grade intervals ever returned from Kliyul. A summary of assay results from the three holes is shown in the table below:
Table 1. 2021 Kliyul Drill Highlights.
| Hole | From(m) | To(m) | Width(m) | Cu(%) | Au(g/t) | CuEq(%)* | AuEq(g/t)** |
|---|---|---|---|---|---|---|---|
| KLI-21-036 | 12.0 | 449.0† | 437.0 | 0.22 | 0.60 | 0.64 | 0.95 |
| including | 12.0 | 33.0 | 21.0 | 0.34 | 1.30 | 1.24 | 1.83 |
| including | 294.0 | 435.0 | 141.0 | 0.36 | 1.11 | 1.13 | 1.67 |
| KLI-21-037 | 12.3 | 579.0† | 566.7 | 0.20 | 0.44 | 0.51 | 0.75 |
| including | 12.3 | 329.0 | 316.7 | 0.30 | 0.70 | 0.79 | 1.17 |
| including | 243.9 | 268.0 | 24.1 | 1.09 | 2.21 | 2.64 | 3.92 |
| KLI-21-038 | 9.0 | 516.0† | 507.0 | 0.15 | 0.39 | 0.43 | 0.63 |
| including | 9.0 | 351.0 | 342.0 | 0.17 | 0.50 | 0.53 | 0.78 |
- CuEq = ((Cu%) x $Cu x 22.0462) + (Au(g/t) x AuR/CuR x $Au x 0.032151) + (Ag(g/t) x AgR/CuR x $Ag x 0.032151)) / ($Cu x 22.0462).
**AuEq = ((Au(g/t) x $Au x 0.032151) + ((Cu%) x CuR/AuR x $Cu x 22.0462) + (Ag(g/t) x AgR/CuR x $Ag x 0.032151)) / ($Au x 0.032151).
Commodity prices: $Cu = US$3.25/lb, $Au = US$1,800/oz., and Ag = US$20.00/oz.
Page 3 of 11
PACIFIC RIDGE exploration Ltd.
Management's Discussion and Analysis Six months ended June 30, 2025
There has been no metallurgical testing on Kliyul mineralization. The Company estimates copper recoveries (CuR) of 84%, gold recoveries (AuR) of 70%, and silver recoveries (AgR) of 65% based on the average recoveries from Kemess Underground, Mount Milligan, and Red Chris.) Factors: 22.0462 = Cu% to lbs per tonne, 0.032151 = Au g/t to troy oz per tonne, and 0.032151 = Ag g/t to troy oz per tonne. † End of hole
Between late June and late September 2022, the company completed a 12-hole, 7014.7 m drill program at KMZ and adjacent targets. Highlights of the drilling are shown in the table below:
Table 2. 2022 Kliyul Drill Highlights.
| Hole | From(m) | To(m) | Width(m) | Cu(%) | Au(g/t) | Ag(g/t) | CuEQ*(%) | AuEQ**(g/t) |
|---|---|---|---|---|---|---|---|---|
| KLI-22-039 | 9.3 | 252.0 | 242.7 | 0.15 | 0.17 | 1.05 | 0.28 | 0.41 |
| 22.0 | 43.4 | 21.4 | 0.38 | 0.48 | 3.96 | 0.73 | 1.08 | |
| 192.0 | 229.0 | 37.0 | 0.20 | 0.27 | 0.67 | 0.39 | 0.58 | |
| KLI-22-040 | 23.0 | 550.8 | 527.8 | 0.19 | 0.30 | 1.35 | 0.40 | 0.60 |
| 170.0 | 268.0 | 98.0 | 0.33 | 0.90 | 3.42 | 0.96 | 1.42 | |
| 210.0 | 253.0 | 43.0 | 0.50 | 1.11 | 2.72 | 1.27 | 1.88 | |
| KLI-22-041 | 12.0 | 600.0 | 588.0 | 0.12 | 0.39 | 0.90 | 0.39 | 0.58 |
| 280.0 | 323.0 | 43.0 | 0.09 | 1.59 | 1.34 | 1.17 | 1.74 | |
| 337.0 | 398.0 | 61.0 | 0.25 | 1.15 | 1.12 | 1.03 | 1.53 | |
| KLI-22-042 | 9.0 | 702.0 | 693.0 | 0.11 | 0.20 | 0.81 | 0.25 | 0.37 |
| 438.0 | 474.4 | 36.4 | 0.14 | 0.62 | 0.99 | 0.56 | 0.83 | |
| KLI-22-043 | 9.0 | 516.0 | 507.0 | 0.17 | 0.19 | 0.82 | 0.31 | 0.46 |
| 165.0 | 229.0 | 64.0 | 0.31 | 0.47 | 1.82 | 0.64 | 0.95 | |
| KLI-22-044 | 11.6 | 651.0 | 639.4 | 0.11 | 0.23 | 0.84 | 0.27 | 0.40 |
| 409.0 | 432.2 | 23.2 | 0.24 | 0.94 | 1.40 | 0.89 | 1.32 | |
| KLI-22-045 | 112.0 | 184.0 | 72.0 | 0.21 | 0.59 | 1.96 | 0.62 | 0.93 |
| KLI-22-046 | 273.0 | 442.0 | 169.0 | 0.20 | 0.46 | 1.65 | 0.52 | 0.77 |
| 371.0 | 430.0 | 59.0 | 0.24 | 0.87 | 2.29 | 0.84 | 1.24 | |
| KLI-22-047 | No significant values | |||||||
| KLI-22-048a | No significant values | |||||||
| KLI-22-049 | 144.0 | 484.0 | 340.0 | 0.15 | 0.20 | 0.80 | 0.29 | 0.42 |
| KLI-22-050 | 58.0 | 584.0 | 526.0 | 0.20 | 0.43 | 1.03 | 0.49 | 0.73 |
| 254.0 | 308.0 | 54.0 | 0.40 | 1.03 | 2.42 | 1.11 | 1.64 | |
| 354.0 | 443.0 | 89.0 | 0.28 | 1.05 | 1.20 | 1.00 | 1.48 |
In addition to the drill program, Pacific Ridge advanced geological work on several other interpreted porphyry centres that occur along the 4 km long northwest-trending corridor of porphyries and quartz-sericite-pyrite alteration. The Company completed a 27 line-km IP survey across Ginger/Ginger South, Parish Hill/Bap Ridge, and M-39, mapping and rock geochemical sampling, e areas, a high-resolution aeromagnetic survey, and a LiDAR survey.
In 2023, the Company completed 10,284 m of drilling in 19 holes. It also completed a program of drill core relogging, petrographic studies and lithogeochemical analysis of portable XRF results by porphyry consultant Brock Riedell. Geological mapping and sampling were also carried out by geological consultant Jim Logan. Two molybdenite-bearing drill core samples from 2023 were processed for rhenium-osmium (Re-Os) age dating and analyzed by R.A. Creaser. On November 14, 2023, the Company announced that it had almost doubled the size of Kliyul from approximately 52 km² to approximately 98 km².
Table 3. 2023 Kliyul Drill Highlights.
| Target | Hole ID | From (m) | To (m) | Width (m) | Cu (%) | Au (g/t) | Ag (g/t) | CuEQ (%) | AuEQ (g/t) |
|---|---|---|---|---|---|---|---|---|---|
| KMZ | KLI-23-051 | 6.3 | 138 | 131.7 | 0.16 | 0.18 | 1.07 | 0.29 | 0.43 |
Page 4 of 11
PACIFIC RIDGE exploration Ltd.
Management's Discussion and Analysis Six months ended June 30, 2025
| Target | Hole ID | From (m) | To (m) | Width (m) | Cu (%) | Au (g/t) | Ag (g/t) | CuEQ (%) | AuEQ (g/t) |
|---|---|---|---|---|---|---|---|---|---|
| KMZ/ KMZ West | KLI-23-052 | 11 | 539.5 | 528.5 | 0.16 | 0.17 | 1.02 | 0.28 | 0.41 |
| includes | 63 | 200 | 137 | 0.22 | 0.26 | 1.41 | 0.4 | 0.6 | |
| and | 403.8 | 467 | 63.2 | 0.23 | 0.21 | 1.53 | 0.39 | 0.57 | |
| KMZ | KLI-23-054 | 11.7 | 552 | 540.3 | 0.19 | 0.36 | 1.09 | 0.44 | 0.65 |
| includes | 181 | 486.5 | 305.5 | 0.23 | 0.51 | 1.22 | 0.59 | 0.87 | |
| includes | 301.5 | 439 | 137.5 | 0.29 | 0.66 | 1.39 | 0.75 | 1.11 | |
| includes | 301.5 | 344 | 42.5 | 0.45 | 1.31 | 2.74 | 1.37 | 2.04 | |
| Ginger | KLI-23-055 | 196.9 | 216 | 19.1 | 0.01 | 0.34 | 0.65 | 0.24 | 0.36 |
| KMZ North | KLI-23-056 | 485.8 | 523 | 37.2 | 0.14 | 0.19 | 1.07 | 0.27 | 0.41 |
| KMZ | KLI-23-057 | 175.4 | 562.8 | 387.4 | 0.1 | 0.2 | 0.76 | 0.24 | 0.36 |
| includes | 290 | 379.2 | 89.3 | 0.21 | 0.25 | 0.91 | 0.38 | 0.57 | |
| includes | 304 | 338 | 34 | 0.24 | 0.29 | 0.97 | 0.44 | 0.66 | |
| KMZ North | KLI-23-058 | 17.1 | 528.6 | 511.4 | 0.16 | 0.29 | 1.01 | 0.36 | 0.53 |
| includes | 105 | 493.5 | 388.5 | 0.18 | 0.35 | 1.05 | 0.42 | 0.62 | |
| includes | 211 | 261.9 | 50.9 | 0.23 | 0.52 | 1.63 | 0.59 | 0.88 | |
| and | 390 | 528.6 | 138.6 | 0.14 | 0.53 | 0.84 | 0.51 | 0.75 | |
| includes | 390 | 493.5 | 103.5 | 0.18 | 0.66 | 0.93 | 0.63 | 0.94 | |
| includes | 439.9 | 492.7 | 52.8 | 0.26 | 1.03 | 1.23 | 0.96 | 1.42 | |
| Parish Hill | KLI-23-059 | 181.1 | 193 | 11.9 | 0.04 | 0.1 | 1.02 | 0.12 | 0.18 |
| 247.1 | 263.7 | 16.7 | 0.06 | 0.02 | 0.65 | 0.08 | 0.12 | ||
| KMZ North | KLI-23-060 | 152 | 252 | 100 | 0.16 | 0.26 | 1.38 | 0.35 | 0.51 |
| includes | 191 | 252 | 61 | 0.18 | 0.32 | 1.67 | 0.4 | 0.6 | |
| and | 584 | 586 | 2 | 0.81 | 10.25 | 35.5 | 7.96 | 11.83 | |
| Ginger S | KLI-23-061 | 224 | 227 | 3 | 0.03 | 0.21 | 0.61 | 0.18 | 0.26 |
| KMZ | KLI-23-062 | 9 | 563 | 554 | 0.14 | 0.16 | 0.83 | 0.25 | 0.37 |
| includes | 13 | 126 | 113 | 0.22 | 0.36 | 1.65 | 0.48 | 0.71 | |
| includes | 276 | 440.3 | 164.3 | 0.16 | 0.15 | 0.73 | 0.27 | 0.4 | |
| KMZ East | KLI-23-063 | 536 | 543.5 | 7.5 | 0.07 | 0.34 | 0.65 | 0.3 | 0.45 |
| KMZ North | KLI-23-064 | 161 | 166 | 5 | 0.24 | 0.58 | 1.87 | 0.45 | 0.67 |
| 230 | 234.7 | 4.7 | 0.06 | 0.57 | 5.5 | 0.48 | 0.71 | ||
| 501.5 | 507.4 | 5.9 | 0.04 | 0.57 | 1.25 | 0.43 | 0.64 | ||
| KMZ West | KLI-23-065 | 10.7 | 615.2 | 604.6 | 0.14 | 0.18 | 0.53 | 0.27 | 0.4 |
| includes | 90 | 201 | 111 | 0.24 | 0.3 | 0.7 | 0.45 | 0.67 | |
| includes | 576 | 611 | 35 | 0.09 | 0.76 | 0.75 | 0.6 | 0.9 | |
| includes | 608.4 | 610 | 1.6 | 0.1 | 13.65 | 5 | 9.32 | 13.85 | |
| KMZ East | KLI-23-066 | 161 | 460 | 299 | 0.17 | 0.14 | 0.6 | 0.27 | 0.39 |
| includes | 201 | 317.9 | 116.9 | 0.28 | 0.22 | 0.96 | 0.44 | 0.65 | |
| and | 627 | +644.0 | 17 | 0.05 | 0.14 | 0.6 | 0.15 | 0.22 | |
| KMZ | KLI-23-067 | 21.4 | 596 | 574.6 | 0.14 | 0.17 | 1.01 | 0.26 | 0.39 |
Page 5 of 11
PACIFIC RIDGE exploration Ltd.
Management's Discussion and Analysis Six months ended June 30, 2025
| Target | Hole ID | From (m) | To (m) | Width (m) | Cu (%) | Au (g/t) | Ag (g/t) | CuEQ (%) | AuEQ (g/t) |
|---|---|---|---|---|---|---|---|---|---|
| includes | 107.8 | 417 | 309.2 | 0.18 | 0.2 | 1 | 0.32 | 0.48 | |
| includes | 139.6 | 197 | 57.4 | 0.22 | 0.26 | 1.22 | 0.41 | 0.6 | |
| includes | 272 | 330 | 58 | 0.24 | 0.21 | 1.07 | 0.39 | 0.58 | |
| KMZ West | KLI-23-068 | 87.2 | 543 | 455.8 | 0.17 | 0.37 | 0.93 | 0.43 | 0.63 |
| includes | 243 | 470.3 | 227.3 | 0.2 | 0.62 | 1.18 | 0.63 | 0.93 | |
| includes | 220 | 330 | 110 | 0.27 | 1.03 | 1.55 | 0.97 | 1.44 | |
| includes | 256.6 | 326 | 69.4 | 0.33 | 1.53 | 1.89 | 1.37 | 2.03 | |
| KMZ North | KLI-23-069 | 85 | 655 | 570 | 0.14 | 0.18 | 0.99 | 0.27 | 0.4 |
| includes | 433.4 | 481 | 47.6 | 0.17 | 0.48 | 0.78 | 0.5 | 0.74 | |
| and | 584 | 629 | 45 | 0.38 | 0.28 | 2.2 | 0.58 | 0.86 |
In addition to more than doubling the size of Kliyul, the 2023 program provided valuable insights into the geology and mineralization at KMZ:
- The porphyry system is not confined to the central KMZ fault block and extends into adjacent fault blocks (KMZ West, KMZ East, and KMZ North) and the amount of fault offset is minimal.
- KMZ central block is interpreted as high standing relative to other blocks but mineralization in other blocks can still come close to surface despite the block-to block fault offsets.
- The porphyry system appears to have a gentle-to-moderate component of tilt to the west. This result has been determined consistently though separate vein and dyke modelling strategies.
- Modelling of magnetic susceptibility values of $10 \times 10^{-3} \mathrm{SI}$ or higher as a proxy for the potassic core zone suggests the porphyry system plunges steeply to the north-northeast or northeast.
-
The porphyry system has at least three symmetrically zoned mineralization signatures over a 1,300 m-long east-west cross section. These include:
-
potassic core zone (~250 m diameter) with higher Au:Cu (> 1), lower Ag:Au (< 3) values, and continuous magnetic susceptibility values of 10 x 10-3 SI or higher;
- chlorite-sericite peripheral zone between $\sim 250 - 500\mathrm{m}$ from the deposit centre with lower Au:Cu $(< 1)$ and higher Ag:Au values $(>3)$ and less continuous domains of $10\times 10^{-3}$ SI magnetic susceptibility;
-
distal D-vein zone (quartz-sericite-pyrite) and/or local skarn occurrences with high Ag:Au values up to $1\mathrm{km}$ from the potassic core zone.
-
A source pluton for the porphyry system has yet to be definitively identified but final drilling in 2023 intersected an alternating sequence of intermediate-felsic intrusive rocks that is suggestive of a pluton top or cupola zone at depth. This is located in KMZ North near the Valley Fault/Divide Lake Fault intersection. A hydrothermal breccia with upward-transported clasts has also been identified in this area.
- Main controls on porphyry mineralization are quartz diorite porphyry dykes, which constitute a dyke field in the known porphyry system, as well as early-stage structural corridors characterized by linear and semi-continuous ductile shear zones that may or may not be later developed in throughgoing brittle faults.
- The porphyry system is currently classified as a Low-K type calc-alkalic system and has some similarities to Kemess, Red Chris, and Saddle North. However, the Company believes that the best analogue is the Far Southeast project (Gold Fields).
Page 6 of 11
PACIFIC RIDGE exploration Ltd.
Management's Discussion and Analysis Six months ended June 30, 2025
During the year ended December 31, 2024, the Company completed a 541 line-kilometre airborne ZTEM survey covering 85% of Kliyul. The results strengthen the Company's confidence that drill hole KLI-23-069 intersected a mineralized quartz diorite porphyry stock, that is believed to be the mineralizing or source pluton north of KMZ.
Subsequent to the quarter, on August 5, the Company announced it's initial mineral resource for KMZ, including 334.1 million tonnes ("Mt") grading 0.33% copper equivalent ("CuEq"), 0.15% copper, 0.26 g/t gold, and 0.95 g/t silver in the Inferred Mineral Resource category, or 2.42 billion pounds CuEq which includes 1.11 billion pounds of copper, 2.74 million ounces of gold and 10.22 million ounces of silver.
Redton
In 2020, the Company completed a one-hole, 434 m drill program, which tested the Redton North target, a 550 m by 250 m magnetic and IP chargeability anomaly with coincident 500 m x 100 m Cu-Mo soil anomaly, located 2.5 km north of Northwest Copper's Kwanika Central Zone deposit. No significant copper or gold assays were encountered in the hole.
In 2022, the Company completed a 294-sample soil geochemical survey, defining two target areas Redton East and NEX. Copper and gold anomalies are consistent with past results and are interpreted to be dispersed down-ice to the east or southeast of geophysical anomalies at East Swan and NEX target areas. No work was carried out at Redton in 2023. An IP program was completed at Redton during the 2024 field season and confirmed porphyry exploration targets within 3 KM of Northwest Copper's Kwanika South Zone copper-gold-molybdenum porphyry deposit.
RDP, British Columbia
In May 2021, the Company acquired an option on the RDP Cu-Au porphyry project in central British Columbia, approximately 40 km west of Kliyul. On January 3, 2024, Pacific Ridge announced that it had exercised its option to acquire a 100% interest in RDP. In addition, the Company will issue 300,000 shares to the vendor on completion of 5,000 m of drilling and an additional 500,000 shares upon defining a 1,000,000 ounces of gold equivalent resource in the inferred or greater category. RDP is also subject to a 2% NSR payable to the vendor, half of which can be purchased at any time for $1.5 million.
RDP is 10,300 ha in size and lies within the Stikine Terrane, which is host to numerous significant porphyry deposits in northern British Columbia, including Kemess, Red Chris, Kerr - Sulphurets and Galore Creek. Exploration at RDP since the early 1970's has included prospecting and mapping, various geochemical surveys, ground and airborne geophysical surveys, trenching and a limited amount of drilling. This work has identified three porphyry centres: Roy, Day and Porcupine. Mineralization at Roy consists of a quartz-magnetite-chalcopyrite stringer-stockwork veining within a monzonite intrusive. Trenching in 1991 encountered 0.121% Cu and 0.55 g/t Au over 62 m within an 80 m long trench. Only a single historical drill hole has been documented at Roy in 2011, and it encountered 122.95 m of 0.11% Cu and 0.64 g/t Au. At Day, mineralization includes pyrite, magnetite, chalcopyrite, minor molybdenite, and traces of bornite as disseminations and fracture fillings in a diorite and adjacent altered volcaniclastic rocks. Historical drill highlights include 58.8 m grading 0.67% Cu and 0.93 g/t Au (D-74-13) and 57 m of 0.54% Cu and 0.75 g/t Au (C-92-13). Porcupine had been explored as a stratabound, massive sulphide target, but recent interpretation of the alteration and soil geochemistry suggests the potential for porphyry style mineralization.
Page 7 of 11
PACIFIC RIDGE exploration Ltd.
Management's Discussion and Analysis Six months ended June 30, 2025
During 2021, the Company completed a mapping and sampling program at RDP, focusing on Roy and Day.
In February 2022, the Company signed an earn-in agreement with Antofagasta Minerals S.A. ("Antofagasta"), a wholly owned subsidiary of Antofagasta PLC on RDP. The Agreement granted Antofagasta the option to acquire a 75% interest in RDP by making payments of $1,350,000, plus a success payment of $800,000 upon exercise of the option, by spending $10,000,000 on exploration over eight years, and delivering a NI 43-101 compliant preliminary economic assessment report. In the first quarter of 2024, Antofagasta terminated the option.
During the 2022 field season, the Company completed a drilling program comprising six holes totaling 1,861 m. Holes RDP22-001 to 005 were drilled at different orientations from a single drill pad at Day and RDP22-006 was drilled at Roy. Highlight results are shown in the table below:
Table 4. 2022 RDP Drill Highlights.
| Hole No | From(m) | To(m) | Width(m) | Cu(%) | Au(g/t) | Ag(g/t) | CuEQ(%) | AuEQ(g/t) |
|---|---|---|---|---|---|---|---|---|
| RDP22-001 | 9.5 | 61.0 | 51.5 | 0.51 | 0.65 | 2.59 | 0.97 | 1.44 |
| RDP22-002 | 16.0 | 42.5 | 26.5 | 0.50 | 0.69 | 4.84 | 1.00 | 1.48 |
| RDP22-003 | 13.1 | 72.5 | 59.4 | 0.78 | 1.20 | 2.99 | 1.61 | 2.39 |
| RDP22-004 | 15.3 | 58.0 | 42.7 | 0.43 | 0.70 | 1.69 | 0.92 | 1.36 |
| RDP22-005 | 15.8 | 513.0 | 497.2 | 0.37 | 0.40 | 1.60 | 0.66 | 0.97 |
| 15.8 | 39.0 | 23.2 | 1.02 | 1.84 | 4.09 | 2.29 | 3.40 | |
| 15.8 | 123.0 | 107.2 | 0.63 | 1.10 | 2.91 | 1.39 | 2.06 | |
| RDP22-006 | 4.0 | 379.0 | 375.0 | 0.04 | 0.19 | 0.23 | 0.17 | 0.25 |
| 4.0 | 30.1 | 26.1 | 0.12 | 0.54 | 0.50 | 0.49 | 0.72 |
The 2023 diamond drilling program at RDP totaled 1,428 metres in three drill holes. Two drill holes were completed at Day. These were large step-outs over 300 m to the northeast and northwest from the collar location for RDP-22-005. In addition, a single diamond drill hole tested Bird, located approximately 2.0 km north of Day, where Pacific Ridge discovered porphyry copper-gold mineralization in a stream cutbank in 2022.
On March 13, 2024, the Company announced that Antofagasta had terminated its option to earn an interest in RDP. The Company is compiling and reviewing all exploration data on RDP with the view to a future drill program.
Subsequent to the quarter, on July 25, the Company announced that the 2025 drill program was underway on the Day target at RDP, with a minimum of 1,500 m of core drilling planned.
Chuchi and Chuchi South, British Columbia
The Company has the option to acquire up to a 75% interest in Chuchi from AuRico. Pacific Ridge has the right to earn a 51% interest by making cash payments totaling $60,000, issuing 2.0 million shares, and spending $5 million on exploration by the fourth anniversary of the agreement. The Company then has the right to increase its interest in Chuchi to 75% by making additional payments totaling $100,000, issuing 1.5 million shares, and completing an additional $5 million in exploration by the sixth anniversary of the agreement. Various claims are subject to up to 6% in net smelter royalties, which can be bought down to 2.1%.
PACIFIC RIDGE exploration Ltd.
Management's Discussion and Analysis Six months ended June 30, 2025
On March 3, 2023, the Company announced that it had acquired an option to earn up to a 75% interest in the Chuchi South porphyry copper-gold project ("Chuchi South") from American Copper Development Corporation and prospector Ronald Bilquist. Chuchi South adjoins Pacific Ridge's Chuchi on the south and west. The acquisition of Chuchi South more than doubles the size of Pacific Ridge's current land position at Chuchi.
Chuchi and Chuchi South (collectively, "Chuchi") are located in North Central British Columbia. The combined property is more than 16,000 ha in size. Chuchi is road accessible, located 90 km north of Fort St. James and 35 km northwest of Centerra Gold's Mount Milligan mine. Chuchi is within the prolific Quesnel Terrane and is underlain by lower Jurassic volcanic and sedimentary rocks of the Takla Group. Porphyry Cu-Au mineralization at the BP and Rio Algom Zones is associated with a cluster of early Jurassic monzodiorite to syenite porphyry intrusions, dated at 188.5 Ma ± 2.5 Ma. The main BP Zone is defined by 4 km × 3 km halo of outer propylitic alteration surrounding a central 1.5 km × 1.5 km area of Cu-Au mineralization, which is open to depth and potentially to the east across the north-south trending Valley Fault. Important target zones at Chuchi South include Coho, Coho West, and Brooks.
Chuchi has a long history of exploration by companies such as Noranda, BP, Rio Algom, Kiska Metals and AuRico, and the project has had 8,886 m of drilling in 48 holes, of which 39 have targeted the main BP Zone. An additional 27 holes were drilled in 1991, but the records for this drilling have been lost. Most of the drilling was shallow, less than 150 m in depth, with many of the drill holes ending in mineralization. Grades within the mineralized portion of the BP Zone range from 0.21% to 0.4% Cu and from 0.21 g/t to 0.44 g/t Au. Pacific Ridge believes that the core of the porphyry system has yet to be identified. Chuchi also contains other targets that could represent porphyry centres.
During 2022, the Company completed a 720 line-km airborne ZTEM survey over the Chuchi claim block, followed by a two-week program of mapping and soil sampling over key target areas outlined by previous studies and the results of the ZTEM survey. The program identified several new porphyry targets.
In 2023, Pacific Ridge completed a ground-based 6.7 line-km IP geophysical survey at Chuchi. Two IP lines (2.5 line-km and 4.2 line-km) were completed and extended coverage across the BP, Digger and Klaw Zones. At Chuchi South, Pacific Ridge completed 15 km of IP, including three lines (5 line-km each at 400 m line-spacing) with coverage of both the 650 × 550 m Coho and 300 × 200 m Coho West surface geochemical target area.
In 2024, the Company completed 2,716m in five diamond drill holes (CH-24-070 to CH-24-074) over a 750m strike length across the BP Zone. Results suggest that drilling encountered the upper part of a large porphyry copper-gold system that has not been adequately tested and remains open laterally and to depth.
During the year ended December 31, 2024, the Company determined not to proceed with the Chuchi South Property and accordingly, recorded an impairment of $105,000 to write the property down to $Nil.
Onjo, British Columbia
On January 27, 2022, the Company entered into a property purchase agreement to acquire a 100% interest in the Onjo Cu-Au porphyry project ("Onjo") in north-central British Columbia. The vendor retains a 2% NSR, with the Company having an option to purchase one quarter of the NSR at any time for USD
PACIFIC RIDGE exploration Ltd.
Management's Discussion and Analysis Six months ended June 30, 2025
$1,500,000. On February 22, 2022, the Company entered into a sale and purchase agreement to acquire a 100% interest in four internal claims at Onjo.
The 14,692 ha road accessible Onjo lies in the 1,300 km long Quesnel Terrane on the same magnetic trend that hosts the Mount Milligan Mine, Chuchi and Kwanika porphyry discoveries.
Onjo hosts skarn and alkalic porphyry Cu-Au mineralization associated with monzonitic phases of the Witch Lake intrusions cutting Takla volcanic rocks, similar to the mineralization and host rocks at the Mount Milligan mine. The style of Cu-Au mineralization returned in historical drilling, combined with the presence of nearby skarn occurrences, leads Pacific Ridge to believe that past operators at Onjo encountered the upper levels of an alkalic porphyry system.
In 2022, the Company completed a 667 line-km airborne ZTEM survey over Onjo. The Company then carried out a ten-day program of mapping and soil sampling over key areas outlined by previous studies and the results of the ZTEM survey.
In 2023, the Company completed a 10 line-km Induced Polarization survey at Onjo, comprising two five km lines. The survey defined chargeability targets that correlate with the anomalous porphyry pathfinder geochemistry (Mo, Cu, Se, Te, Bi, As, Sb, Au, MPIx). No work was completed at Onjo in 2024 and no work is currently planned in 2025.
Orbison, British Columbia
The Orbison project (a.k.a. Gap Project) is a reconnaissance porphyry Cu-Au exploration program in central British Columbia. The Company is evaluating known properties and showings as well as examining regional geological, geophysical, and geochemical databases for evidence of potential porphyry Cu-Au mineralization. The Orbison claims were staked as a part of the Gap Project. No work was completed at Orbison in 2024 and no work is currently planned in 2025.
Mariposa, Yukon
The Company's 100% owned, 295 km² Mariposa Property is in the Yukon's White Gold District, 120 km southeast of Dawson City, 40 km southeast of White Gold's Golden Saddle Deposit and 30 km east-northeast of Newmont's Coffee Property. Prior exploration identified an open-ended 7-km long horizon of altered sulphide bearing quartz mica schist in the Skookum Zone area, in a setting favorable for hosting gold mineralization.
Since 2010, The Company has spent over $6 million exploring the Mariposa Property, including geological mapping, soil geochemical surveys, geophysical surveys, trenching and drilling. Results are summarized on the Company's web site.
During the 2022 field season, the Company completed a program of re-sampling and reclamation of historical trenches dating from 2012.
During 2023, all outstanding disturbance on the property was reclaimed, including the historical camp site on Scroggie Creek and trenches over the Skookum Main, Skookum West, and Hackly target areas.
Page 10 of 11
PACIFIC RIDGE exploration Ltd.
Management's Discussion and Analysis Six months ended June 30, 2025
The Company completed a soil geochemical survey at Mariposa in 2024 and additional soil sampling is planned for 2025. The plans for advancing Mariposa include seeking a potential farm-out or sale of the property.
Eureka Dome, Yukon
The Company's 100% owned 32 km² Eureka Dome property is located 70 km southeast of Dawson City, within the Klondike-White Gold District. Placer mining activity in Eureka Creek dates to the 1896 gold rush, with estimated historical production from Eureka and Black Hills Creeks of greater than 140,000 oz. Au. No work is planned at Eureka in 2024.
The plans for advancing Eureka Dome include seeking a potential farm-out or sale of the property.
Gold Cap, Yukon
The 100% owned 1,100 ha Gold Cap property adjoins the northeast boundary of White Gold Corp's Golden Saddle property. The property was staked in 2009 based on an anomalous gold silt sample reported by the Geological Survey of Canada. In 2010, Pacific Ridge collected 1,766 soil samples and defined two anomalous gold zones.
The Gold Cap claims were allowed to lapse on April 8, 2025.
Page 11 of 11
PACIFIC RIDGE exploration Ltd.
Management's Discussion and Analysis Six months ended June 30, 2025
SUMMARY OF CAPITALIZED ACQUISITION COSTS AND EXPLORATION EXPENSES
The following acquisition-related costs are carried by the Company in its consolidated statement of financial position presented with its Financial Statements:
| Company-owned properties | Properties on option from third parties | Total | |||||||
|---|---|---|---|---|---|---|---|---|---|
| Kliyul BC | Redton BC | Onjo BC | Orbison BC | RDP BC | Mariposa YT | Chuchi BC | Chuchi South BC | ||
| $ | $ | $ | $ | $ | $ | $ | $ | ||
| Balance, December 31, 2023 | 3,635,681 | 35,000 | 412,230 | 12,261 | 155,449 | - | 50,216 | 50,000 | 4,350,837 |
| Option payments in cash | - | - | - | - | - | - | 5,000 | 11,000 | 16,000 |
| Other payments in cash | 1,425 | - | - | - | - | 7,840 | 9,041 | (61,000) | (42,694) |
| Balance, December 31, 2024 | 3,637,106 | 35,000 | 412,230 | 12,261 | 155,449 | 7,840 | 64,257 | - | 4,324,143 |
| Option payments in cash | - | - | - | - | - | - | 35,000 | - | 35,000 |
| Balance, June 30, 2025 | 3,637,106 | 35,000 | 412,230 | 12,261 | 155,449 | 7,840 | 99,257 | - | 4,359,143 |
PACIFIC RIDGE exploration Ltd.
Management's Discussion and Analysis Six months ended June 30, 2025
The following is a summary of exploration expenses incurred in each of the Company's projects, the total of which is presented with the Company's statement of loss and comprehensive loss presented with its Financial Statements:
| Property | Province/Territory | Six months ended June 30, | |
|---|---|---|---|
| 2025 $ | 2024 $ | ||
| Kliyul | BC | 17,092 | 162,302 |
| Chuchi | BC | 17,285 | 129,475 |
| Mariposa | YT | 8,394 | 13,406 |
| Eureka Dome | YT | 8,380 | - |
| Redton | BC | 956 | 15,303 |
| Chuchi South | BC | 956 | 2,242 |
| Onjo | BC | 956 | 841 |
| Orbison (Gap) | BC | - | - |
| RDP – Portion incurred by the Company | BC | 60,843 | 1,250 |
| RDP - Project management fees* | BC | - | (2,083) |
| General exploration | 15,198 | 93,897 | |
| Total exploration expenses incurred by the Company: | 130,060 | 416,633 | |
| * Exploration in RDP financed by Antofagasta: | - | 47,277 | |
| Total exploration expenses | 130,060 | 463,910 |
- During the six months ended June 30, 2025, $nil were incurred by Antofagasta (2024 - $47,277 plus $30,000 in a property option payment to the property's underlying owner).
FINANCING ACTIVITIES
On March 26, 2025, the Company closed the first tranche of a non-brokered private placement issuing 618,823 flow-through units ("FT Units") at a price of $0.17 per FT Unit for gross proceeds of $105,200 and 1,632,430 non-flow-through units ("NFT Units") at a price of $0.14 per NFT Unit for gross proceeds of $228,540.
Each FT Unit is comprised of one common share of the Company issued as a "flow-through share" within the meaning of the Income Tax Act (Canada) (each, a "FT Share") and one common share purchase warrant ("Warrant"). Each NFT Unit is comprised of one common share of the Company and one Warrant. Each Warrant is exercisable to purchase one additional non-flow-through common share at an exercise price of $0.20 any time on or before March 28,2028. The Company incurred share issuance costs for this private placement of $33,927. The warrants were fair valued at $nil using the residual value and the Company recorded a flow-through premium of $18,565 offset by the allocation of $924 of share issuance costs.
On June 4, 2025, the Company closed the second tranche of a non-brokered private placement issuing 3,561,292 flow-through units ("FT Units") at a price of $0.17 per FT Unit for gross proceeds of $605,420 and 15,184,494 non-flow-through units ("NFT Units") at a price of $0.14 per NFT Unit for gross proceeds of $2,125,829.
Each FT Unit is comprised of one common share of the Company issued as a "flow-through share" within the meaning of the Income Tax Act (Canada) (each, a "FT Share") and one common share purchase warrant. Each NFT Unit is comprised of one common share of the Company and one warrant. Each warrant is exercisable to purchase one additional non-flow-through common share at an exercise price of $0.20 any
Page 1 of 11
PACIFIC RIDGE exploration Ltd.
Management's Discussion and Analysis Six months ended June 30, 2025
time on or before June 4, 2028. The Company incurred share issuance costs for this private placement of $131,009. The warrants were fair valued at $nil using the residual value method and recorded a FT premium of $106,839 offset by the allocation of $3,230 of share issuance costs based on the share price on the date of issuance.
RESULTS OF OPERATIONS
| Note | Three months ended June 30, | Six months ended June 30, | |||
|---|---|---|---|---|---|
| 2025 | 2024 | 2025 | 2024 | ||
| $ | $ | $ | $ | ||
| Administrative expenses | |||||
| Amortization | 10 | 1,255 | 20,487 | 6,407 | 41,046 |
| Finance lease interest | 10 | 1,303 | 859 | 2,447 | 2,194 |
| Insurance | 2,565 | 6,087 | 3,580 | 18,912 | |
| Professional and consulting fees | 7 | 55,912 | 31,479 | 64,466 | 33,895 |
| Property investigation | 6,141 | - | 6,141 | - | |
| Management and administrative | 101,382 | 85,826 | 247,670 | 171,687 | |
| Office operations and facilities | 78,007 | 33,269 | 114,068 | 60,021 | |
| Shareholder communications | 69,232 | 34,832 | 106,085 | 101,837 | |
| Share-based payments | 5 | 439,937 | - | 439,937 | 5,458 |
| Transfer agent and regulatory fees | 21,450 | 22,951 | 46,344 | 43,184 | |
| 777,184 | 235,790 | 1,037,145 | 478,234 | ||
| Exploration expenses (income) | |||||
| Exploration and evaluation costs | 3 | 90,959 | 265,068 | 127,560 | 416,633 |
| Bad Debt | 2,500 | - | 2,500 | - | |
| Mining tax credit | (13,122) | (31,677) | (13,122) | (31,677) | |
| 80,337 | 233,391 | 116,938 | 384,956 | ||
| Other expenses (income) | |||||
| Interest | (153) | (15,444) | (289) | (11,099) | |
| Foreign exchange | 1,329 | 2,064 | 1,367 | 2,713 | |
| Amortization of flow-through premium | (2,935) | - | (2,935) | - | |
| (1,759) | (13,380) | (1,857) | (8,386) | ||
| Net loss for the period | (855,762) | (455,801) | (1,152,226) | (854,804) |
The Company has not yet determined whether any of its resource properties contain mineral reserves that are economically recoverable. All acquisition costs associated with the Company's resource properties have been capitalized and direct costs associated with the exploration of these properties have been expensed as incurred.
Three months ended June 30, 2025
The Company had a net loss of $855,762 (2024 - $455,801) for the three months ended June 30, 2025, representing an increase of $399,961 over the three months ended June 30, 2025. The change in loss is primarily due to the following:
- Shareholder communication increased by $34,400 as the Company increased external consulting fees during the current period.
Page 2 of 11
PACIFIC RIDGE exploration Ltd.
Management's Discussion and Analysis Six months ended June 30, 2025
- Share-based payments increased by $439,937 as the Company granted options during the current period to directors and officers.
- Exploration expenditures decreased by $171,609 as the current season started later compared to the prior year.
- Professional and consulting increased by $24,433 as the Company changed lawyers in the current period.
Six months ended June 30, 2025
The Company had a net loss of $1,152,226 (2024 - $854,804) for the six months ended June 30, 2025, representing an increase of $297,422 over the six months ended June 30, 2025. The change in loss is primarily due to the following:
- Shareholder communication increased by $4,248 as the Company increased external consulting fees during the current period.
- Share-based payments increased by $439,937 as the Company granted options during the current period to directors and officers.
- Exploration expenditures decreased by $286,573 as the current season started later compared to the prior year.
- Management and administration costs increased by $75,983 because of exploration employees allocating more time to corporate activities.
- Professional and consulting increased $30,571 as the Company changed lawyers in the current period.
SUMMARY OF QUARTERLY RESULTS
The following table sets forth a comparison of information for the previous eight quarters:
| Three Months Ended ($) | ||||
|---|---|---|---|---|
| June 30, 2025 | March 31, 2025 | December 31, 2024 | September 30, 2024 | |
| Revenue | - | - | - | - |
| Net loss | (855,762) | (296,464) | (1,095,873) | (1,358,204) |
| Basic and diluted loss per share* | (0.02) | (0.02) | (0.07) | (0.00) |
| Dividends per share | Nil | Nil | Nil | Nil |
| Total assets | 6,707,589 | 4,738,847 | 4,520,621 | 5,727,072 |
| Total long-term liabilities | - | - | - | - |
| Three Months Ended ($) | ||||
| June 30, 2024 | March 31, 2024 | December 31, 2023 | September 30, 2023 | |
| Revenue | - | - | - | - |
| Net loss | (455,801) | (399,003) | (685,491) | (5,439,899) |
| Basic and diluted loss per share* | (0.00) | (0.00) | (0.01) | (0.40) |
| Dividends per share | Nil | Nil | Nil | Nil |
| Total assets | 7,009,868 | 6,190,404 | 5,157,202 | 7,432,861 |
| Total long-term liabilities | - | - | 4,317 | 8,432 |
Page 3 of 11
PACIFIC RIDGE exploration Ltd.
Management's Discussion and Analysis Six months ended June 30, 2025
Quarterly results
- During Q1 and Q2, 2025, the Company concluded the financing activities described above, resulting in increased assets. The increase in loss during Q3 2024 compared to Q2 2024 is primarily driven by an increase in exploration expenditures during Q3 2024 as a result of the flow-through financing completed in June 2024.
- During Q4, 2024 the Company recorded a write-down of resource properties of $105,000 (2023 - $nil).
- During Q4, 2023, the Company issued 700,000 common shares at a price of $0.155 (equivalent to $108,500) to the underlying owner of RDP. With this, the Company now owns 100% of RDP. In addition, the Company received cash proceeds of $66,000 from the exercise of 110,000 stock options. The Company also recovered $62,025 for operator's fees related to RDP from Antofagasta.
- During Q3, 2023, the Company closed the non-brokered private placement described under Financing activities, above, raising gross proceeds of $661,080. Also, during Q3 2023, with the exploration season in its more active period, the expenses were considerably higher than during the other quarters. This was consistent with Q3 of 2022.
- During Q2, 2023, the Company completed the acquisition of Kliyul and Redton through the issuance of 1,699,610 common shares at a deemed price of $2.30 per share, reflecting an increase in the value of share capital. As the acquisition costs are capitalized, this increase is also reflected in total assets. The Company also received proceeds of $11,500 from the exercise of 5,000 share purchase warrants with an exercise price of $2.30 per share. Exploration expenses increased due to the start of the 2023 field season.
LIQUIDITY AND CAPITAL RESOURCES
The Company is dependent on raising funds through the issuance of shares or disposition of interests in resource properties in order to finance further acquisitions, undertake exploration and meet general and administrative expenses.
As at June 30, 2025, the Company had cash on hand of $2,158,172 of which $4,817 were part of Antofagasta's funding for RDP. The Company's working capital as at this date was approximately $2,042,012.
The Company's condensed interim consolidated financial statements have been prepared on a going concern basis, which contemplates that the Company will be able to continue its operations for at least twelve months from June 30, 2025, and will be able to realize its assets and discharge its liabilities and commitments in the normal course of business. The Company has not generated revenue from operations to date and will require additional financing or outside participation to undertake further advanced exploration of its mineral properties. Future operations of the Company are dependent upon its ability to raise additional equity financing and maintain sufficient working capital and upon future production or proceeds from the dispositions of its mineral property interests.
The Company's operations to date have been financed by the issuance of common shares, the exercise of share purchase warrants, and the exercise of stock options. The continuing operations of the Company are dependent upon its ability to continue to raise adequate financing and liquidate its investments as necessary. During the six months ended June 30, 2025, the Company's financing activities provided cash of $2,949,285 of which $2,354,369 were flow-through funds, through a non-brokered private placement financing.
Page 4 of 11
PACIFIC RIDGE exploration Ltd.
Management's Discussion and Analysis Six months ended June 30, 2025
RELATED PARTY TRANSACTIONS
Related parties include the board of directors and officers, close family members and enterprises that are controlled by these individuals as well as certain consultants performing similar functions.
The Company has no compensation arrangements with its board of directors other than non-cash stock option grants. In the case of senior officers of the Company, which include the Chairman, the President & CEO, and the CFO, the Company provides certain compensation for termination without cause and for a change of control of the Company.
Key management includes the board of directors and executive officers.
The following transactions with related parties took place:
| For the three months ended June 30, | For the six months ended June 30, | |||
|---|---|---|---|---|
| 2025 | 2024 | 2025 | 2024 | |
| $ | $ | $ | $ | |
| Management fees Chairman | 10,000 | 7,600 | 14,400 | 21,840 |
| Management fees CEO | 46,603 | 48,041 | 93,206 | 96,083 |
| Management fees CFO | 22,500 | 24,000 | 45,000 | 44,000 |
| Share-based payments | 251,560 | - | 251,560 | - |
| 330,663 | 79,641 | 404,166 | 161,923 |
All related party transactions were in the normal course of business and as at June 30, 2025, the Company had $13,592 (2024 - $38,308) owing to related parties.
OUTSTANDING SHARE DATA
All share information is reported as of the date of this MD&A in the following table:
| Number | |
|---|---|
| Issued and outstanding common shares | 38,393,496 |
| Share options with a weighted average exercise price of $2.69 | 3,512,500 |
| Warrants with a weighted average exercise price of $1.30 | 26,256,714 |
| Fully diluted capital: | 68,162,710 |
OFF-BALANCE SHEET ARRANGEMENTS
The Company has no off-balance sheet arrangements.
PROPOSED TRANSACTIONS
There are no proposed transactions as of the date of this MD&A.
Page 5 of 11
PACIFIC RIDGE exploration Ltd.
Management's Discussion and Analysis Six months ended June 30, 2025
CHANGES IN ACCOUNTING POLICIES
Changes in the Company's accounting policies are disclosed in Note 2 of the accompanying Financial Statements.
FINANCIAL INSTRUMENTS
The Company has classified cash, other receivables, and trade payable and accrued liabilities at amortized cost, and its marketable securities as FVTOCI.
Fair values
As at June 30, 2025, the recorded amounts for cash, other receivables and trade payable and accrued liabilities approximate their fair values due to their short maturity. The Company's marketable securities are measured at fair value on a recurring basis. These financial instruments are grouped into Level 1 to 3 based on the degree to which the significant inputs used to determine the fair value are observable. No financial instruments were considered level 3, which are fair value measurements derived from valuation techniques that include significant inputs that are not based on observable market data.
Interest rate risk
The Company's cash held in financial institutions earns interest at variable interest rates. However, due to the short-term nature of these financial instruments, fluctuations in market rates do not have a material impact on the expected cash flows.
Credit risk
The Company has its cash deposited at one of Canada's largest banks with an AA rating, federally insured, and therefore exposed to minimal credit risk.
Liquidity risk
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company manages liquidity risk by forecasting cash flows from operations and anticipated investing and financing activities and through the management of its capital structure. At June 30, 2025, the Company had cash of $2,158,172 (December 31, 2024 - $12,095), trade payable and accrued liabilities of $108,991 (December 31, 2024 - $168,146), a financial liability of $4,817 (December 31, 2024 - $4,817) corresponding to cash provided by Antofagasta Minerals for exploration at RDP (note 3(d)), and lease liabilities of $nil (December 31, 2024 - $4,203). At June 30, 2025, there exists material uncertainty with respect to the Company's ability to continue as a going concern. Refer to Note 1 of these consolidated financial statements.
Currency risk
As at June 30, 2025, the Company kept less than 1% of its cash in US dollars. A change in the value of the US dollar by 10% relative to the Canadian dollar would affect the Company's working capital by an immaterial amount.
Price risk
As the Company no longer holds any marketable securities, there is no price risk at June 30, 2025.
Page 6 of 11
PACIFIC RIDGE exploration Ltd.
Management's Discussion and Analysis Six months ended June 30, 2025
CRITICAL ACCOUNTING ESTIMATES
The Company makes estimates and assumptions concerning the future that will, by definition, seldom equal actual results. The following are the areas of estimate and judgment applied by management that most significantly affects the Company's financial statements. These estimates and judgments have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year.
Management applies judgment in reviewing for impairment indicators the carrying value of the resource properties on a quarterly basis, or whenever events or circumstances indicate that their carrying value may not be recovered. If there are indicators of impairment, the recoverable amount of the related asset is estimated in order to determine the extent of any impairment. Indicators of impairment may include (i) the period during which the Company has the right to explore in the specific area has expired during the year or will expire in the near future and is not expected to be renewed, (ii) substantive expenditure on further exploration for and evaluation of mineral resources in the specific area is neither budgeted nor planned, (iii) exploration for and evaluation of mineral resources in the specific area have not led to the discovery of commercially viable quantities of mineral resources and the entity has decided to discontinue such activities in the specific area; and (iv) sufficient data exists to indicate that the carrying amount of the resource properties is unlikely to be recovered in full from successful development or by sale. During the year ended December 31, 2024, the Company wrote-off the Chuchi South project as management has determined it will not proceed with this option.
Risk factors
The Company is subject to a number of risks due to the nature of its business and the present stage of exploration projects. The following factors should be considered:
Mineral Exploration and Development
The Company's properties are in the exploration stage and are without a known body of commercial ore. Development of any of the Company's properties will only follow upon obtaining satisfactory exploration results. Mineral exploration and development involve a high degree of risk and few properties which are explored are ultimately developed into producing mines. There is no assurance that the Company's mineral exploration and development activities will result in the discovery of a body of commercial ore on any of its properties. Several years may pass between the discovery and the development of commercial mineable mineralized deposits. Most exploration projects do not result in the discovery of commercially mineralized deposits.
Trends
The Company's financial success is dependent upon the discovery of mineral resources which could be economically viable to develop. Such development could take years to complete and the resulting income, if any, is difficult to determine. The sales value of any mineralization discovered by the Company is largely dependent upon factors beyond the Company's control, such as market value of the products produced and availability of capital from the public marketplace. Other than as disclosed herein, the company is not aware of any trends, uncertainties, demands, commitments or events which are reasonably likely to have a material effect on the Company's results or financial position.
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PACIFIC RIDGE exploration Ltd.
Management's Discussion and Analysis Six months ended June 30, 2025
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, development and production of resources, 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, explosions, cave-ins, landslides and the inability to obtain suitable or adequate machinery, equipment or labour are some of the risks involved in the operation of mines and the conduct of exploration programs. Although the Company will, when appropriate, secure liability insurance in an amount which it considers adequate, the nature of these risks is such that liabilities might exceed policy limits, the liability and hazards might not be insurable, or the Company might elect not to insure itself against such liabilities due to high premium costs or other reasons, in any of which events the Company could incur significant costs that could have a material adverse effect upon its financial condition.
Economics of Developing Mineral Properties
Substantial expenditures are required to establish ore reserves through drilling, to develop metallurgical processes to extract metal from ore and to develop the mining and processing facilities and infrastructure at any site chosen for mining. No assurance can be given that minerals will be discovered in sufficient quantities to justify commercial operation or that the funds required for development can be obtained on a timely basis.
The marketability of any minerals acquired or discovered may be affected by numerous factors which are beyond the Company's control, and which cannot be predicted, such as market fluctuations, the proximity and capacity of milling facilities, mineral markets and processing equipment, and such other factors as government regulations, including regulations relating to royalties, allowable production, importing and exporting of minerals, and environmental protection. Depending on the price of minerals produced, the Company may determine that it is impractical to commence or continue commercial production.
Environmental Factors
The Company conducts exploration activities in various parts of Canada and the United States. Such activities are subject to various laws, rules and regulations governing the protection of the environment, including, in some cases, posting of reclamation bonds. Extensive environmental legislation has been enacted in Canada by federal, provincial and territorial governments and in the United States by federal and state governments. 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 reduce the profitability of operations or to preclude entirely the economic development of a property. 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. The Company is not aware of any environmental hazards on any of the properties held or formerly worked by the Company. The approval of new mines in Canada is subject to detailed review through a clearly established public hearing process, pursuant to both the Federal Canadian Environmental Assessment Act and the provincial and territorial Environmental Review Agencies. Further, under such review process, there is no assurance
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PACIFIC RIDGE exploration Ltd.
Management's Discussion and Analysis Six months ended June 30, 2025
that regulatory and environmental approvals will be obtained on a timely basis or at all. Failure to comply with the legislation may have serious consequences. Orders may be issued requiring operations to cease or be curtailed or requiring installation of additional facilities or equipment. Violators may be required to compensate those suffering loss or damage by reason of its mining activities and may be fined if convicted of an offense under such legislation.
Canadian provincial and territorial state mining legislation establishes requirements for the decommissioning, reclamation and rehabilitation of mining properties in a state of temporary or permanent closure. Such closure requirements relate to the protection and restoration of the environment and the protection of the public safety. Some former mining properties must be managed for long periods of time following closure in order to fulfill closure requirements. The costs of closure of mining properties, and, in particular, the cost of long-term management of mining properties can be substantial. The Company intends to progressively rehabilitate its mining properties during their period of operation, should any properties become operational, so as to reduce the cost of fulfilling closure requirements after the termination or suspension of production.
The Company has adopted environmental practices designed to ensure that it continues to comply with or exceeds all environmental regulations currently applicable to it. All of the Company's activities are in compliance in all material respects with applicable environmental legislation. The Company is currently engaged in exploration with minimal environmental impact.
Title
Although the Company has exercised the usual due diligence with respect to title to properties in which it has a material interest, there is no guarantee that title to the properties will not be challenged or impugned. The Company's mineral property interests may be subject to prior unregistered agreements or transfers, or native land claims and title may be affected by undetected defects. In addition, certain of the mining claims in which the Company has an interest are not recorded in the name of the Company and cannot be recorded until certain steps are taken by other parties. Before a number of claims under option can be recorded in the Company's name, the underlying title holder has to assign title to the Company once the Company satisfies its option agreement obligations. There are no assurances that the underlying title holder will assign title. Land may be transferred by the State to businesses and citizens for possession and use based on leases.
Canadian Aboriginal Land Claims
Canadian Aboriginal rights may be claimed on properties or other types of tenure with respect to which mining rights have been conferred. The Company is aware of the mutual benefits afforded by cooperative relationships with indigenous people in conducting exploration activity and is generally supportive of measures established to achieve such cooperation. While there is, to the Company's knowledge, no specific existing claim in respect of any of its properties, the advent of any future aboriginal land claims and the outcome of any aboriginal land claims negotiations or related issues cannot be predicted.
Competition and Agreements with Other Parties
The Company competes with other mining companies for the acquisition of mineral claims and other mining interests as well as for the recruitment and retention of qualified employees and contractors. There is significant and increasing competition for a limited number of resource acquisition opportunities and as a result, the Company may be unable to acquire attractive mining properties on terms it considers acceptable. The Company competes with other companies that may have substantially greater financial
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PACIFIC RIDGE exploration Ltd.
Management's Discussion and Analysis Six months ended June 30, 2025
resources than the Company. The Company may, in the future, be unable to meet its obligations under agreements to which it is a party, and the Company may have its interest in the properties subject to such agreements reduced as a result. Furthermore, if other parties to such agreements do not meet their share of such costs, the Company may be unable to finance the cost required to complete recommended programs.
Governmental Regulation
Operations, development and exploration 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, 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, and 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 or territory in which it is carrying out work. Mineral exploration primarily falls under provincial or state jurisdiction. However, the Company is also required to follow the regulations pertaining to the mineral exploration industry that fall under federal jurisdictions, such as the Fish and Wildlife Act in Canada and the Environmental Protection Agency in the United States.
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. In addition, new laws or regulations governing operations and activities of mining companies could have a material adverse impact on any project in the mine development stage that the Company may possess.
Metals Prices
The Company’s revenues, if any, and ability to attract equity financing is expected to be in large part derived from the discovery of mineral properties and the sale of minerals contained or interests related thereto. The prices of those commodities may fluctuate widely and are affected by numerous factors beyond the Company’s control including international economic and political conditions, expectations of inflation, international currency exchange rates, interest rates, global or regional consumptive patterns, speculative activities, levels of supply and demand, increased production due to new mine developments and improved mining and production methods, availability and costs of metal substitutes, metal stock levels maintained by producers and other and inventory carrying costs. The effect of these factors on the price of base and precious metals, and therefore the economic viability of the Company’s operations, cannot accurately be predicted.
Management and Directors
The Company is dependent on its key management personnel. Loss of the key person could have an adverse effect on the Company. The Company does not maintain “key-man” insurance in respect of any of its management.
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PACIFIC RIDGE exploration Ltd.
Management's Discussion and Analysis Six months ended June 30, 2025
Conflicts of Interest
Certain of the Directors and Officers of the Company are also in their personal capacities, or as Directors or Officers of other companies, engaged in mineral exploration and development. Accordingly, exploration opportunities or prospects of which they become aware may not necessarily be made available to the Company. The Directors and Officers intend to allocate opportunities or prospects from time to time on the basis of prudent business judgment. The Directors are required by law to act honestly and in good faith with a view to the best interest of the Company and its shareholders and to disclose any personal interest which they may have in any material transaction which is proposed to be entered into with the Company and to abstain from voting as a Director for the approval of such transaction.
Price Fluctuations: Share Price Volatility
In recent years, the international securities markets have experienced high levels of price and volume volatility, and the market prices of securities of many mineral exploration companies have experienced wide fluctuations which have not necessarily been related to the operating performance, underlying asset values or prospects of such companies. There can be no assurance that the continual fluctuations in market price will not occur which may impact the Company's market capitalization as well as its ability to facilitate equity financing.
Russia and Ukraine conflict
While the Company has no operations, projects or personnel in Europe, this conflict adds potential elements of risk such as inflationary pressures affecting prices of fuel and supplies, as well as supply chain delays. These risks could potentially affect the cost and timely development of its exploration programs.
Tariffs
On February 1, 2025, the U.S. administration issued an executive order directing the United States to impose new tariffs on imports from Canada to take effect on February 4, 2025. The tariffs are an additional 25% rate of duty on all imports from Canada except Canadian Energy resource exports, which are subject to a 10% tariff. While the Company has no operations outside of Canada, tariffs add potential elements of risk such as inflationary pressures affecting prices of supplies, commodity prices and overall market conditions. These factors may impact the ability of the Company to execute on its business plans.
FINANCIAL AND DISCLOSURE CONTROLS AND PROCEDURES
In connection with National Instrument 52-109 (Certificate of Disclosure in Issuer's Annual and Interim Filings) ("NI 52-109"), the Chief Executive Officer and Chief Financial Officer of the Company have filed a Venture Issuer Basic Certificate with respect to the financial information contained in the condensed interim consolidated financial statements for the six months ended June 30, 2025 and 2024, and this accompanying MD&A (together, the "Interim Filings").
In contrast to the full certificate under NI 52-109, the Venture Issuer Basic Certificate 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. For further information, the reader should refer to the Venture Issuer Basic Certificates filed by the Company with the Annual Filings on SEDAR+ at www.sedarplus.ca.
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