Playfair Mining Ltd. — Interim / Quarterly Report 2022

Jul 29, 2021

PLAYFAIR MINING LTD.

CONDENSED INTERIM FINANCIAL STATEMENTS (Unaudited) (Expressed in Canadian Dollars)

FOR THE THREE MONTH PERIOD ENDED MAY 31, 2021

NOTICE OF NO AUDITOR REVIEW OF CONDENSED INTERIM FINANCIAL STATEMENTS

Under National Instrument 51-102, Part 4, subsection 4.3 (3) (a), if an auditor has not performed a review of the condensed interim financial statements, they must be accompanied by a notice indicating that an auditor has not reviewed the financial statements.

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

The Company’s independent auditor has not performed a review of these financial statements in accordance with standards established by the Canadian Institute of Chartered Accountants for a review of interim financial statements by an entity’s auditor.

PLAYFAIR MINING LTD.

CONDENSED INTERIM STATEMENTS OF FINANCIAL POSITION (Unaudited - Expressed in Canadian Dollars) AS AT

		May 31, 2021	February 28, 2021
ASSETS Current Cash Receivables Prepaid expenses (Note 6) Advances receivable(Note 3) Equipment(Note 4) Exploration and evaluation assets(Note 5)		$ 1,156,247 55,877 5,000 1,217,124 25,339 158 1,577,176 $ 2,819,797	$ 32,330 21,335 25,000
			78,665 81,889 167 1,118,108 $ 1,278,829
LIABILITIES AND SHAREHOLDERS’ EQUITY Current Accounts payable and accrued liabilities (Note 6) Shareholders’ equity Share capital (Note 7) Subscriptions receivable (Note 7) Obligation to issue shares (Note 7) Reserves (Note 7) Deficit		$ 193,420 34,307,390 (313,900) - 274,403 (31,641,516) 2,626,377 $ 2,819,797	$ 348,990 32,423,436 (308,900) 18,000 274,403 (31,477,100) 929,839 $ 1,278,829

Nature and continuance of operations (Note 1) Subsequent events (Note 11)

Approved and authorized by the Board on July 29, 2021.

Donald G. Moore Director D. Neil Briggs Director

The accompanying notes are an integral part of these financial statements.

PLAYFAIR MINING LTD.

CONDENSED INTERIM STATEMENTS OF LOSS AND COMPREHENSIVE LOSS (Unaudited - Expressed in Canadian Dollars) FOR THE THREE MONTH PERIOD ENDED MAY 31

			2021		2020
GENERAL AND ADMINISTRATIVE EXPENSES Amortization (Note 4) Filing fees Management fees Office and miscellaneous Professional fees Rent Shareholder communications Telephone Transfer agent and regulatory fees Travel and trade show Loss and comprehensive loss for the period			$ 9 5,060 15,000 26,761 23,500 12,583 77,020 3,771 712 -		$ 11 - 15,000 158 3,500 6,358 16,004 - 1,606 2,996 $ (45,633)
			$ (164,416)
Basic and diluted loss per common share			$ (0.01)		$ (0.01)
Weighted average number of common shares outstanding			92,588,054		76,590,856

.

The accompanying notes are an integral part of these financial statements.

CONDENSED INTERIM STATEMENTS OF CASH FLOWS (Unaudited - Expressed in Canadian Dollars) FOR THE THREE MONTH PERIOD ENDED MAY 31

PLAYFAIR MINING LTD.

			2021		2020
CASH FLOWS FROM OPERATING ACTIVITIES Loss for the period Items not affecting cash: Amortization Changes in non-cash working capital items: Receivables Prepaid expense Accounts payables and accrued liabilities Net cash used in operating activities CASH FLOWS FROM INVESTING ACTIVITIES Advance from related party Exploration and evaluation expenditures Net cash provided by/(used in) investing activities CASH FLOWS FROM FINANCING ACTIVITIES Issuance of common shares Subscription advance/(receivable) Share issuance costs Net cash provided by financing activities Change in cash for the period Cash, beginning of period Cash, end ofperiod			$ (164,416) 9 (34,542) 20,000 24,430 (154,519)		$ (45,633) 11 4,664 33,805 11,580 (4,427) 87,500 - 87,500 - 25,000 - 25,000 116,927 10,123 $ 127,050
			56,550 (396,092)
			(339,542)
			1,451,000 180,000 (13,022)
			1,617,978
			1,123,917 32,330 $ 1,156,247

Supplemental disclosure with respect to cash flows (Note 8)

The accompanying notes are an integral part of these financial statements.

PLAYFAIR MINING LTD.

STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (DEFICIENCY) (Expressed in Canadian Dollars)

		ShareCapital	ShareCapital	ShareCapital		Reserves		Subscriptions receivable		Obligation to issue shares		Deficit		Total
		Number		Amount
Balance at February 29, 2020 Issued for: Private placement Exercise of stock options Loss for the year Balance at May 31, 2020 Issued for: Private placement Shares issued for property acquisition Exercise of stock options Share issue costs Obligation to issue shares Expiry of options Share-based payments Loss for the year Balance at February 28, 2021 Issued for: Private placement Shares issued for property acquisition Share issue costs Obligation to issue shares Loss for the year Balance at May 31, 2021		76,550,095 - 625,000 - 77,175,095 12,000,000 3,314,911 2,225,000 - - - - - 94,090,006 10,906,670 1,214,884 - 150,000 - 106,361,560		$ 31,156,096 - 110,656 - $ 31,266,752 600,000 397,790 274,000 (4,450) - - - - $ 32,423,436 1,636,000 242,977 (13,023) 18,000 - $ 34,307,390		$ 395,778 - (48,156) - $ 347,622 - - (131,500) - - (10,277) 20,402 - $ 274,403 - - - - - $ 274,403		$ (180,000) 25,000 (62,500) - $ (217,500) (35,600) - (93,300) - - - - - $ (308,900) (5,000) - - - - $ (313,900)		$ - - - - $ - - - - - 18,000 - - - $ 18,000 - - - (18,000) - $ -		$ (30,926,872) - - (45,633) $ (30,972,505) - - - - - 10,277 - (560,505) $ (31,477,100) - - - - (164,416) $(31,641,516)		$ 445,002 25,000 - (45,633) $ 424,369 564,400 397,790 49,200 (4,450) 18,000 - 20,402 (560,505) $ 929,839 1,631,000 242,977 (13,023) - (164,416) $ 2,626,377

The accompanying notes are an integral part of these financial statements.

PLAYFAIR MINING LTD. NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (Unaudited - Expressed in Canadian Dollars) FOR THE THREE MONTH PERIOD ENDED MAY 31, 2021

1. NATURE AND CONTINUANCE OF OPERATIONS

Playfair Mining Ltd. (the “Company”) is an exploration stage company incorporated under the laws of the Province of British Columbia on August 26, 1988. The Company has not yet determined whether its exploration and evaluation assets contain economic ore reserves.

The Company’s registered and records office is 2900-595 Burrard Street, Vancouver, British Columbia, Canada.

These financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) with the assumption that the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. A number of alternatives including, but not limited to completing a financing, are being evaluated with the objective of funding ongoing activities and obtaining additional working capital. The continuing operations of the Company are dependent upon its ability to continue to raise adequate financing and to commence profitable operations in the future and repay its liabilities arising from normal business operations as they become due. These material uncertainties may cast significant doubt about the Company’s ability to continue as a going concern.

In March 2020 the World Health Organization declared 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. It is not possible for the Company to predict the duration or magnitude of the adverse results of the outbreak and its effects on the Company’s business or ability to raise funds.

The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue in existence.

2. BASIS OF PREPARATION

Statement of compliance

These condensed consolidated interim financial statements, including comparatives, have been prepared in accordance with International Accounting Standards (“IAS”) 34 ‘Interim Financial Reporting’ (“IAS 34”) using accounting policies consistent with the International Financial Reporting Standards (“IFRS”) issued by the International Accounting Standards Board (“IASB”) and Interpretations of the International Financial Reporting Interpretations Committee (“IFRIC”).

Basis of presentation

These condensed interim financial statements have been prepared on the basis of accounting policies and methods of computation consistent with those applied in the Company’s February 29, 2020 annual financial statements.

3. ADVANCES RECEIVABLE

The Company advances funds to a management company owned by a former officer. The management company incurs administration expenditures and settles certain exploration expenditures on behalf of the Company. At February 28, 2021 the Company had advanced $25,339 (February 28, 2021 - $81,889). The advances were unsecured and non-interest bearing.

PLAYFAIR MINING LTD. NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (Unaudited - Expressed in Canadian Dollars) FOR THE THREE MONTH PERIOD ENDED MAY 31, 2021

4. EQUIPMENT

	Office equipment	Computer equipment	Total
Cost Balance, February 29, 2020, February 28, 2021 and May 31, 2021	$ 26,089	$ 33,173	$ 59,262
Accumulated amortization Balance, February 29, 2020 Amortization for the year Balance, February 28, 2021 Amortization for the year Balance, May 31, 2021	$ 25,895 38 25,933 8 $ 25,941	$ 33,157 5 33,162 1 $ 33,163	$ 59,052 43 59,095 9 $ 59,104
Carrying amounts As at May 31, 2021 As at February28,2021	$ 148 $ 156	$ 10 $ 11	$ 158 $ 167

5. EXPLORATION AND EVALUATION ASSETS

May 31, 2021	RKV Project
Acquisition costs: Balance, beginning of period Acquisition of exploration and evaluation assets Balance, end of period Exploration costs: Balance, beginning of period Drilling Equipment Fees & licenses Balance, end of period Balance, May 31, 2021	$ 637,790 242,977 880,767 480,318 67,030 66,825 82,236 696,409 $1,577,176

PLAYFAIR MINING LTD. NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (Unaudited - Expressed in Canadian Dollars) FOR THE THREE MONTH PERIOD ENDED MAY 31, 2021

5. EXPLORATION AND EVALUATION ASSETS (cont’d...)

February 28, 2021		RKV Project
Acquisition costs: Balance, beginning of year Acquisition of exploration and evaluation assets Balance, end of year Exploration costs: Balance, beginning of year Assay Field expenses Metalurgy & geophysics Travel Balance, end of year Balance, February 28, 2021		$ 240,000 397,790 637,790 271,825 20,600 106,983 72,055 8,855 480,318 $1,118,108

Title to mineral properties

Title to mineral properties involves certain inherent risks due to the difficulties of determining the validity of certain claims as well as the potential for problems arising from the frequently ambiguous conveyancing history characteristic of many mineral properties. The Company has investigated title to all of its mineral properties and, to the best of its knowledge, title to all of its properties are in good standing.

RKV Project property, Norway

On February 28, 2019, the Company had entered into an option and exploration agreement to acquire a 100% interest in the Rostvangen and Vakkerlien properties in South Central Norway (“RKV Project”) from Eurasian Minerals Sweden AB (“EMX”). To acquire the properties, the Company issued 3,000,000 shares (valued at $135,000) and reimbursed EMX’s government fees and licensing costs of $49,994 with a condition to the exercise of the option that the Company must incur $250,000 in exploration expenditures within one year (incurred).

Furthermore, the Company had exercised their option and issued an additional 3,000,000 shares (valued at $105,000). EMX transferred 100% of the property to the Company (March 19, 2020) and EMX will receive a 3% net smelter royalty (“NSR”) on the property. Within 5 years, the Company will have the option to buy back up to 1% of the NSR for $3,000,000, leaving EMX with a 2% NSR. EMX will receive annual advance royalty (“AAR”) payments of $30,000 commencing on the second anniversary of the option exercise, with the AAR payments increasing by $5,000 per year until reaching $80,000 per year.

Following exercise of the option the Company undertakes to complete a minimum of 1,000 meters of drilling in the following year and a cumulative 2,000 meters within 2 years following the option exercise. During the fiscal 2021 the agreement was amended and the Company will be required to complete a minimum of 1,000 meters of drilling within 6 months following receipt of necessary permits, licenses or consents. In addition, the Company undertakes to use commercially reasonable efforts to raise an additional $2,750,000 for advancement of the RKV Project on or before the 5[th] anniversary of the agreement.

No later than 2 years after the signing the Company will issue sufficient shares to EMX to bring EMX’s ownership of the Company to 9.9% of issued and outstanding share capital. The Company will maintain EMX’s interest in the

PLAYFAIR MINING LTD. NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (Unaudited - Expressed in Canadian Dollars) FOR THE THREE MONTH PERIOD ENDED MAY 31, 2021

5. EXPLORATION AND EVALUATION ASSETS (cont’d...)

RKV Project property, Norway (cont’d...)

Company, at no additional cost to EMX until the Company has raised a cumulative $3,000,000 in equity to fund exploration and development on the properties or until 5 years after Exchange approval, whichever occurs first. Thereafter, EMX will have the right to participate pro-rata in future financings at its own cost to maintain its interest in the Company. During the fiscal 2021 the Company issued 3,314,911 shares (valued at $397,790) to bring EMX’s ownership of the Company to 9.9%. During the three month period ended May 31, 2021 the Company issued 1,214,884 shares (valued at $242,977) to bring EMX’s ownership of the Company to 9.9%.

Property Exploration Costs

Additional exploration and equipment costs of $340,615 incurred on the Ox Mountain Property (Ireland) were expensed. The agreement with Bowpark Exploration (Ireland) Ltd. has been terminated and the property licenses expired during the current fiscal year. Other exploration costs of $5,801 were also incurred during fiscal 2021. The aforementioned property was still held by the Company but was written down in prior fiscal years due to inactivity.

6.

RELATED PARTY TRANSACTIONS

The key management personnel of the Company are the Directors, Chief Executive Officer, and the Chief Financial Officer. Included in accounts payable at May 31, 2021 is $1,143 (February 28, 2021 - $7,443) due to directors of the Company. Included in advances receivable at May 31, 2021 is $25,339 (February 28, 2021 - $81,889) due from a company owned by a former officer of the Company. Included in prepaid expenses at May 31, 2021 is $5,000 (February 28, 2021 - $20,000) paid to a company owned by a former officer of the Company. Included in accounts receivable at May 31, 2021 is $23,372 (February 28, 2021 - $872) due from a company with common directors.

Compensation of the Company’s key management personnel is comprised of the following:

		May 31,		May 31,
		2021		2021
Professional fees	$	20,000	$	7,500
Management fees	$	15,000	$	15,000

7. SHARE CAPITAL AND RESERVES

Authorized share capital

As at May 31, 2021, the authorized share capital of the Company is an unlimited number of common shares without par value.

Issued share capital

As at May 31, 2021, the Company had 106,361,560 common shares issued and outstanding.

Share issuances

During the three month period ended May 31, 2021 the Company issued 10,906,670 common shares at $0.15 per share for gross proceeds of $1,636,000, of which $185,000 is in subscriptions receivable. The Company incurred share issuance costs of $13,022. During the three month period ended May 31, 2021 the Company issued 1,214,884 shares (valued at $242,977) to EMX as part of the acquisition of the RKV project. During the three month period ended May 31, 2021 the Company had issued 150,000 common shares (valued at $18,000) per obligation in exchange for exploration services rendered.

PLAYFAIR MINING LTD. NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (Unaudited - Expressed in Canadian Dollars) FOR THE THREE MONTH PERIOD ENDED MAY 31, 2021

7. SHARE CAPITAL AND RESERVES (cont’d...)

Share issuances (cont’d...)

During the year ended February 28, 2021 the Company issued 12,000,000 common shares at $0.05 per share for gross proceeds of $600,000, of which $35,600 is in subscriptions receivable. The Company incurred share issuance costs of $4,450. During the year ended February 28, 2021 the Company issued 3,314,911 shares (valued at $397,790) to EMX as part of the acquisition of the RKV project. During the year ended February 28, 2021 the Company has an obligation to issue 150,000 common shares (valued at $18,000) in exchange for exploration services rendered.

Stock options

Stock option transactions are summarized as follows:

		Stock Options
		Number Weighted Average Exercise Price
Outstanding and exercisable, February 28, 2019 Granted Exercised Expired Outstanding and exercisable, February 29, 2020 Granted Exercised Expired Outstandingand exercisable,February28,2021 and May31,2021		4,630,000 $ 0.08 2,700,000 0.05 (500,000) 0.05 (30,000) 0.10 6,800,000 $ 0.07 450,000 0.12 (2,225,000) 0.06 (175,000) 0.07 4,850,000 $ 0.07

The following stock options were outstanding at February 28, 2021:

	Number	Exercise
	of Shares	Price	ExpiryDate
Options	1,700,000*	$0.10	August 22, 2021
	250,000*	$0.12	July 6, 2022
	200,000*	$0.12	September 23, 2022
	2,700,000*	$0.05	December 20, 2024

Share-based payments

The Company has an incentive stock options plan in place under which it is authorized to grant options to directors and employees to acquire up to 10% of the Company’s issued and outstanding common shares. Under the plan, the exercise price of each option may not be less than the market price of the Company’s stock as calculated on the date of grant less the applicable discount. The options can be granted for a maximum term of 5 years and vesting periods are determined by the Board of Directors.

PLAYFAIR MINING LTD. NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (Unaudited - Expressed in Canadian Dollars) FOR THE THREE MONTH PERIOD ENDED MAY 31, 2021

7. SHARE CAPITAL AND RESERVES (cont’d…)

Share-based payments (cont’d…)

During the three month period ended May 31, 2021, the Company granted Nil (February 28, 2021 – 450,000) options with a weighted-average fair value of $Nil per option (February 28, 2021 - $0.05) to directors and consultants. Accordingly, using the Black-Scholes option pricing model, the stock options are recorded at fair value in the statement of loss and comprehensive loss. Total share-based payments recognized in the statement of loss and comprehensive loss during the three month period ended May 31, 2021 was $Nil (February 28, 2021 – $20,402) for incentive options granted, vested and amended. This amount was also recorded as reserves on the statement of financial position. The following weighted average assumptions were used for the Black-Scholes option pricing model for the year ended February 28, 2021:

	February 28, 2021
Risk free rate	1.64%
Expected life of options	1.00
Annualized volatility	129.64%
Dividend rate	Nil
Forfeiture rate	Nil

8. SUPPLEMENTAL DISCLOSURE WITH RESPECT TO CASH FLOWS

The significant non-cash transactions for three month period ended May 31, 2021 consisted of the Company incurring exploration and evaluation expenditures of $44,025 through accounts payable and accrued liabilities, issuing $242,977 worth of shares and issued 150,000 valued at $18,000 per obligation for exploration and evaluation assets.

During the period ended May 31, 2020 the Company reclassified exercised 625,000 stock options valued at $48,155 to share capital.

9. SEGMENTED INFORMATION

The Company operates in one reportable operating segment, being the acquisition and exploration of mineral properties in Norway. Geographic information is disclosed in Note 6.

10. FINANCIAL AND CAPITAL RISK MANAGEMENT

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

The fair value of the Company’s receivables, advances receivable, and accounts payable and accrued liabilities approximate their carrying values due to their short-term nature. The Company’s other financial instrument, being cash, is measured at fair value using Level 1 inputs.

PLAYFAIR MINING LTD. NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (Unaudited - Expressed in Canadian Dollars) FOR THE THREE MONTH PERIOD ENDED MAY 31, 2021

10. FINANCIAL AND CAPITAL RISK MANAGEMENT (cont’d…)

The Company is exposed to varying degrees to a variety of financial instrument related risks:

Credit risk

Credit risk is the risk of an unexpected loss if a customer or third party to a financial instrument fails to meet its contractual obligations. The Company’s cash is held at a large Canadian financial institution in interest bearing accounts. The Company has no investment in asset backed commercial paper. Receivables consist of receivables due from the government of Canada and amounts due from related parties. Advances receivable are due from a company owned by a former officer of the Company.

Liquidity risk

The Company’s approach to managing liquidity risk is to ensure that it will have sufficient liquidity to meet liabilities when they come due. As at May 31, 2021, the Company had a cash balance of $1,156,247 (February 28, 2021 - $32,330) to settle current liabilities of $193,420 (February 28, 2021 - $348,990). To maintain liquidity, the Company is currently investigating financing opportunities and new exploration projects. Current market conditions make the present environment for raising additional equity financing unfavourable and there can be no assurance these efforts will be successful in the future. All of the Company’s financial liabilities are subject to normal trade terms. The Company is exposed to liquidity risk.

Market risk

Market risk is the risk of loss that may arise from changes in market factors such as interest rates, foreign exchange rates, and commodity and equity prices. These fluctuations may be significant.

• a) Interest rate risk

The Company has a limited exposure to interest rate risk.

b) Foreign currency risk

The Company does not have any balances denominated in a foreign currency and believes it has no significant foreign currency risk.

• c) Price risk

The Company is exposed to price risk with respect to commodity prices. Changes in commodity prices will impact the economics of development of the Company’s mineral properties. The Company closely monitors commodity prices to determine the appropriate course of action to be taken.

Capital management

The Company manages its capital structure and makes adjustments to it, based on the funds available to the Company, in order to support the acquisition and exploration of mineral properties. The Board of Directors does not establish quantitative return on capital criteria for management, but rather relies on the expertise of the Company’s management to sustain future development of the business. The Company defines capital that it manages as shareholders’ equity.

The properties in which the Company currently has an interest are in the exploration stage; as such the Company has historically relied on the equity markets to fund its activities. There is no certainty with respect to the Company’s ability to raise capital. The Company will continue to assess new properties and seek to acquire an interest in additional properties if it feels there is sufficient geologic or economic potential and if it has adequate financial

PLAYFAIR MINING LTD. NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (Unaudited - Expressed in Canadian Dollars) FOR THE THREE MONTH PERIOD ENDED MAY 31, 2021

10. FINANCIAL AND CAPITAL RISK MANAGEMENT (cont’d...)

Capital Management (cont’d…)

resources to do so. Management reviews its capital management approach on an ongoing basis and believes that this approach, given the relative size of the Company, is reasonable.

The Company currently is not subject to externally imposed capital requirements. There were no changes in the Company’s approach to capital management.

11. SUBSEQUENT EVENTS

Subsequent to the three month period ended May 31, 2021, the Company:

• a) grant of 5,600,000 incentive stock options to various directors, officers and consultants of the Company pursuant to its Stock Option Plan. The options are exercisable at $0.20 per share for terms of up to 5 years following the date of grant. The option grant is subject to TSX Venture Exchange acceptance.

• b) received $185,000 in subscription receivable