Scottie Resources Corp. — Interim / Quarterly Report 2023

May 2, 2023

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SCOTTIE RESOURCES CORP.

Condensed Consolidated Interim Financial Statements For the three and six month period ended February 28, 2023 and 2022 (Unaudited – Prepared by Management) (Expressed in Canadian dollars)

NOTICE OF NO AUDITOR REVIEW OF INTERIM FINANCIAL STATEMENTS

The accompanying unaudited interim financial statements have been prepared by management and approved by the Audit Committee and Board of Directors.

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

This notice is being provided in accordance with National Instrument 51-102 – Continuous Disclosure Obligations

SCOTTIE RESOURCES CORP. Condensed Consolidated Interim Statements of Financial Position

(Unaudited – Prepared by Management)

(Expressed in Canadian dollars)

As at
	February 28, 2023	August 31, 2022
ASSETS Current assets Cash and cash equivalents Amounts receivable (Note 4) Prepaid expenses and advances (Note 5) Non-current assets Deposits Property and equipment (Note 6) Mineral properties (Note 7) Total assets	$ 6,828,617 646,770 74,375 7,549,762 248,432 619,350 15,031,311 $ 23,448,855	$ 3,539,530 557,691 40,897 4,138,118 248,432 667,907 14,174,311 $ 19,228,768
LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities Accounts payable and accrued liabilities (Note 8, 9) Non-current liabilities Flow through liability (Note 9) Total liabilities Shareholders’ equity Share capital (Note 10) Equity reserves (Note 10) Deficit Total shareholders’ equity Total liabilities and shareholders’ equity	$ 407,300 1,330,013 1,737,313 45,749,853 4,975,100 (29,013,411) 21,711,542 $ 23,448,855	$ 2,954,761 302,671 3,257,432 37,579,779 4,199,250 (25,807,693) 15,971,336 $ 19,228,768

Nature of operations and going concern (Note 1) Subsequent events (Note 15)

Approved for issue by the Board of Directors on May 1, 2023.

Approved On behalf of the Board of Directors:

“Bradley Rourke” “Ernest Mast” Bradley Rourke, Director Ernest Mast, Director

The accompanying notes form an integral part of these condensed consolidated interim financial statements.

SCOTTIE RESOURCES CORP. Condensed Consolidated Interim Statements of Loss and Comprehensive Loss

(Unaudited – Prepared by Management)

(Expressed in Canadian dollars)

Three months Three months			Six months	Six months
	Ended	Ended	Ended	Ended
	February 28,	February 28,	February 28,	February 28,
	2023	2022	2023	2022
EXPENSES Exploration expenditures General and administrative Management and consulting fees Marketing and investor relations Professional fees (Note 11) Share-based compensation (Note 10, 11) OTHER INCOME (EXPENSES) BCMETC Recovery Recovery of flow-through premium (Note 9) Gain on sale of equipment (Note 6 Foreign exchange gain/(loss) Loss and comprehensive loss for theperiod	$ 316,680 92,973 50,000 111,736 181,885 459,747 (1,213,021) - 36,576 8,475 536 $(1,167,434)	$ 613,267 75,598 28,000 143,072 173,625 42,485 (1,076,047) 88,976 21,939 - 1,782 $ (963,350)	$ 2,023,909 221,371 100,000 256,369 278,110 622,268 (3,502,027) - 286,993 8,475 841 $(3,205,718)	$ 4,984,909 156,982 75,000 301,891 310,930 107,531 (5,937,243) 88,976 157,824 - 330 $(5,690,113)
Basic and diluted loss per share Weighted average number of common shares outstanding (Note 10)	(0.00) 246,602,489	(0.00) 202,433,537	(0.01) 239,904,125	(0.03) 202,433,537

The accompanying notes form an integral part of these condensed consolidated interim financial statements.

SCOTTIE RESOURCES CORP. Condensed Consolidated Interim Statements of Cash Flows

(Unaudited – Prepared by Management)

(Expressed in Canadian dollars)

For the three months ended	February 28, 2023	February 28, 2022
CASH FLOWS FROM OPERATING ACTIVITIES Net loss for the period Adjustments for items not involving cash: Amortization (Note 6) Recovery of flow-through premium (Note 9) Gain on sale of equipment (Note 6) Share-based compensation (Note 10) Net changes in non-cash working capital items: Amounts receivable Prepaid expenses and advances Accounts payable and accrued liabilities Net cash outflows from operating activities CASH FLOWS FROM INVESTING ACTIVITIES Property and equipment acquisitions and improvements (Note 6) Acquisition of mineral property Reclamation bonds Net cash outflows from investing activities CASH FLOWS FROM FINANCING ACTIVITIES Share capital issued Share issue costs Net cash inflows from financing activities Net increase (decrease) in cash during the period Cash, beginning of period Cash, end ofperiod	$ (3,205,718) 37,032 (286,993) (8,475) 622,268 (2,841,886) (69,079) (33,478) (2,674,106) (5,618,549) - (102,500) - (102,500) 9,700,250 (690,114) 9,010,136 3,289,087 3,539,530 $ 6,828,617	$ (5,690,113) 37,494 (157,824) - 107,531 (5,702,912) (137,892) 1,711,428 (154,850) (4,284,226) (6,954) - (144,932) (151,886) - - - (4,436,112) 7,265,107 $ 2,828,995

Supplemental disclosure with respect to cash flows – Note 14

The accompanying notes form an integral part of these condensed consolidated interim financial statements.

SCOTTIE RESOURCES CORP.

Condensed Consolidated Interim Statements of Changes In Equity

(Unaudited – Prepared by Management)

(Expressed in Canadian dollars)

	Number	Amount	Contributed Surplus	Deficit	Total
Balance August 31, 2021 Share-based compensation Loss and comprehensive loss Balance February 28, 2022 Private placement Share issuance costs Warrants issued as finders’ fees Flow-through premium Property acquisition Share-based compensation Loss and comprehensive loss Balance August 31, 2022 Private placement Share issuance costs Warrants issued as finders’ fees Flow-through premium Property acquisition Royalty acquisition Share-based compensation Loss and comprehensive loss Balance February 28, 2023	202,433,537 - - 202,433,537 18,800,000 - - - 500,000 - - 221,733,537 41,122,530 - - - 600,000 2,500,000 - - 265,956,067	$ 34,178,840 - - 34,178,840 5,008,000 (504,416) (65,145) (1,130,000) 92,500 - - 37,579,779 9,700,250 (816,759) (153,582) (1,314,335) 117,000 637,500 - - $ 45,749,853	$ 3,876,367 107,531 - 3,983,898 - - 65,145 - - 150,207 - 4,199,250 - - 153,582 - - - 622,268 - $ 4,975,100	$ (16,291,902) - (5,690,113) (21,982,015) - - - - - - (3,825,678) (25,807,693) - - - - - - - (3,205,718) $ (29,013,411)	$ 21,763,305 107,531 (5,690,113) 16,180,723 5,008,000 (504,416) - (1,130,000) 92,500 150,207 (3,825,678) 15,971,336 9,700,250 (816,759) - (1,314,335) 117,000 637,500 622,268 (3,205,718) $ 21,711,542

The accompanying notes form an integral part of these condensed consolidated interim financial statements.

SCOTTIE RESOURCES CORP. Notes to the Condensed Consolidated Interim Financial Statements For the three and six-month period ended February 28, 2023 and 2022 (Expressed in Canadian dollars)

1. NATURE OF OPERATIONS

Scottie Resources Corp. (“Scottie” or the “Company”) is a publicly traded company incorporated on November 24, 2009 under the laws of the Province of British Columbia, Canada. The Company’s shares are listed on the TSX Venture Exchange (“TSX-V”) under the symbol SCOT.

The Company’s corporate registered and records office is located at #905 – 1111 West Hastings Street, Vancouver, British Columbia, V6E 2J3. The Company is engaged in the identification, acquisition, exploration, and development of mineral properties in British Columbia, Canada. The Company has not placed any of its mineral properties into production and is therefore considered to be in the exploration stage. These condensed consolidated interim financial statements for the Company for the six months ended February 28, 2023 are comprised of the results of the Company and its former subsidiary, AUX Resources Corporation (“AUX”), which amalgamated on May 31, 2022.

The Company is in the process of exploring its mineral properties and has not yet determined whether any of its properties contain mineral reserves that are economically recoverable. The recoverability of the amounts spent for mineral properties is dependent upon the existence of economically recoverable reserves, the ability of the Company to obtain the necessary financing to complete the exploration and development of its properties, and upon future profitable production or proceeds from the disposition of the properties.

These condensed consolidated interim financial statements are prepared on a going concern basis, which assumes that the Company will be able to realize its assets and discharge its liabilities in the normal course of business in the foreseeable future. The Company’s ability to continue on a going concern basis beyond the next twelve months depends on its ability to successfully raise additional financing for the substantial capital expenditures required to achieve planned principal operations. While the Company has been successful in the past in obtaining financing, there is no assurance that it will be able to obtain adequate financing in the future or that such financing will be on terms acceptable to the Company. The Company has not generated any revenues since inception and has a history of losses and accumulated deficit of $29,013,411 as at February 28, 2023. These factors form a material uncertainty that may raise significant doubt regarding the Company’s ability to continue as a going concern. These condensed consolidated interim financial statements do not reflect adjustments that would be necessary if the going concern assumption were not appropriate, which could be material.

There are many external factors that can adversely affect general workforces, economies and financial markets globally. Examples include, but are not limited to, the COVID-19 global pandemic and political conflict in other regions. It is not possible for the Company to predict the duration or magnitude of adverse results of such external factors and their effect on the Company’s business or ability to raise funds.

2. BASIS OF PREPARATION

Statement of compliance

These condensed consolidated interim financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) issued by the International Accounting Standards Board (“IASB”) and the Interpretations of the International Financial Reporting Interpretations Committee (“IFRIC”). These condensed consolidated interim financial statements are compliant with IAS 34 and do not include all of the information required for full annual financial statements.

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SCOTTIE RESOURCES CORP. Notes to the Condensed Consolidated Interim Financial Statements For the three and six-month period ended February 28, 2023 and 2022 (Expressed in Canadian dollars)

2. BASIS OF PREPARATION (Cont’d…)

Basis of measurement

These condensed consolidated interim financial statements have been prepared using the historical cost basis, except for certain financial instruments that are measured at fair value, using the accrual basis of accounting, except for cash flow information.

Functional and presentation currency

The presentation currency of the Company is the Canadian dollar.

Items included in the condensed consolidated interim financial statements of each entity in the Company are measured using the currency of the primary economic environment in which the entity operates (the “functional currency”), which has been determined for each entity within the Company using an analysis of the consideration factors identified in IAS 21, The Effects of Changes in Foreign Exchange Rates . The functional currency of the Company and its former subsidiary is the Canadian dollar.

Significant Accounting Policies

The accounting policies applied in preparation of these condensed consolidated interim financial statements are consistent with those applied and disclosed in the Company’s annual financial statements for the year ended August 31 , 2022.

Use of estimates and judgments

The preparation of the condensed consolidated interim financial statements in conformity with IFRS requires management to make estimates, judgments and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income, and expenses. Actual results may differ from these estimates.

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

• a) Critical Accounting Estimates

Critical accounting estimates are estimates and assumptions made by management that may result in a material adjustment to the carrying amount of assets and liabilities within the next financial year and include, but are not limited to, the following:

Share-based compensation and valuation of warrants

The fair value pricing of stock options and warrants issued are subject to the limitations of the BlackScholes Option-Pricing Model that incorporates market data and involves uncertainty in estimates used by management in the assumptions. Because the Black-Scholes Option-Pricing Model requires the input of highly subjective assumptions, including the volatility of share prices, changes in subjective input assumptions can materially affect the fair value estimate.

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SCOTTIE RESOURCES CORP. Notes to the Condensed Consolidated Interim Financial Statements For the three and six-month period ended February 28, 2023 and 2022 (Expressed in Canadian dollars)

2. BASIS OF PREPARATION (Cont’d…)

• b) Critical Accounting Judgments

Information about critical judgments in applying accounting policies that have the most significant effect on the amounts recognized in the financial statements include, but are not limited to, the following:

Going concern presentation

Management has determined that the going concern presentation of the financial statements, which assumes that the Company will continue in operation for the foreseeable future and will be able to realize its assets and discharge its liabilities in the normal course of operations as they come due as discussed in Note 1, is appropriate.

Carrying value and the recoverability of mineral properties

Management has determined that Company-incurred exploration costs that have been capitalized may have future economic benefits and may be economically recoverable. Management uses several criteria in its assessments of economic recoverability and probability of future economic benefits including geological and other technical information, scoping and feasibility studies, accessibility of facilities, and existing permits.

3. FINANCIAL INSTRUMENT AND RISK MANAGEMENT

Categories of Financial Assets and Financial Liabilities

Financial instruments are classified into one of the following categories: amortized cost; fair value through profit or loss (“FVTPL”); fair value through other comprehensive income (“FVOCI”).

The carrying values of the Company’s financial instruments are classified into the following categories:

Financial Instrument	Category		February 28, 2023		August 31, 2022
Cash and cash equivalents	Amortized cost	$	6,828,617	$	3,539,530
Amounts receivable	Amortized cost	$	646,770	$	557,691
Deposits	Amortized cost	$	248,432	$	248,432
Accountspayable	Amortized cost	$	407,300	$	2,954,761

The Company’s financial instruments recorded at fair value require disclosure about how the fair value was determined based on significant levels of inputs described in the following hierarchy:

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SCOTTIE RESOURCES CORP. Notes to the Condensed Consolidated Interim Financial Statements For the three and six-month period ended February 28, 2023 and 2022 (Expressed in Canadian dollars)

3. FINANCIAL INSTRUMENT AND RISK MANAGEMENT (Cont’d…)

• Level 1 – Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions occur in sufficient frequency and value to provide pricing information on an ongoing basis.

• Level 2 – Pricing inputs are other than quoted prices in active markets included in Level 1. Prices in Level 2 are either directly or indirectly observable as of the reporting date. Level 2 valuations are based on inputs including quoted forward prices for commodities, time value and volatility factors, which can be substantially observed or corroborated in the marketplace.

• Level 3 – Valuations in this level are those with inputs for the asset or liability that are not based on observable market data.

The recorded amounts for amounts receivable, deposits, and accounts payable approximate their fair value due to their short-term nature. Cash and cash equivalents are recorded at fair value and calculated under the fair value hierarchy and measured using Level 1 inputs.

Risk Management

The Company’s risk exposures and the impact on the Company’s financial instruments are summarized as follows:

Credit Risk

Credit risk is the risk of potential loss to the Company if a counter-party to a financial instrument fails to meet its contractual obligations. The Company’s credit risk is primarily attributable to its liquid financial assets, including cash and amounts receivable. The Company limits the exposure to credit risk in its cash by only investing its cash with high-credit quality financial institutions.

Interest Rate Risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company is exposed to interest rate risk to the extent that its cash balances bear variable rates of interest. The interest rate risks on cash and on the Company’s obligations are not considered significant.

Liquidity Risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting its short-term debt obligations. The Company’s approach to managing liquidity risk is to ensure that it will have sufficient liquidity to meet liabilities when they come due; all of the Company’s accounts payable are current and due within 90 days of the balance sheet. As at February 28, 2023, the Company has cash and cash equivalents of $6,828,617 to settle current liabilities of $407,300.

4. ACCOUNTS RECEIVABLE

		February 28,		August 31,
		2023		2022
Trade receivable	$	21,000	$	25,198
GST receivable		530,850		437,573
BCMETC receivable		94,920		94,920
Total	$	646,770	$	557,691

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SCOTTIE RESOURCES CORP. Notes to the Condensed Consolidated Interim Financial Statements For the three and six-month period ended February 28, 2023 and 2022 (Expressed in Canadian dollars)

5. PREPAID EXPENSES AND ADVANCES

		February 28,		August 31,
		2023		2022
Exploration advances	$	15,000	$	22,499
Prepaid expenses		59,375		18,398
Total	$	74,375	$	40,897

6. PROPERTY AND EQUIPMENT

	Equipment	Equipment		Computer		Vehicle		Land		Building	Total
COST
Balance, August 31, 2021	$	67,584	$	2,141	$	152,000	$	137,594	$	405,228 $	764,547
Additions		6,955		3,542		-		-		-	10,497
Balance, August 31, 2022		74,539		5,683		152,000		137,594		405,228	775,044
Additions		-		-		-		-		-	-
Disposal		(20,000)		-		-		-		-	(20,000)
Balance, February 28, 2023	$	54,539	$	5,683	**$ **	152,000	**$ **	137,594	**$ **	**405,228$ **	755,044
ACCUMULATED AMORTIZATION
Balance, August 31, 2021	$	8,906	$	602	$	3,643	$	-	$	18,069 $	31,220
Amortization		24,541		714		30,400		-		20,262	75,917
Balance, August 31, 2022		33,447		1,316		34,043		-		38,331	107,137
Amortization		10,679		1,231		15,075		-		10,047	37,032
Disposal		(8,475)		-		-		-		-	(8,475)
Balance, February 28, 2023	$	35,651	$	2,547	$	49,118	$	-	$	**48,378$ **	135,694
CARRYING AMOUNTS
As at August 31,2022	$	41,092	$	4,367	$	117,957	$	137,594	$	366,897$	667,907
As at February 28, 2023	$	18,888	$	3,136	**$ **	102,882	**$ **	137,594	**$ **	**356,850$ **	619,350

7. MINERAL PROPERTIES

Title to mineral property interests 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 claims. All of the Company’s mineral interests are located near Stewart, British Columbia, Canada in the region known as the Golden Triangle. The properties have been acquired under various option and purchase agreements and by staking. Certain claims are subject to a net smelter returns (“NSR”) royalty ranging from 1% to 3%.

The Company has investigated title to all of its mineral property interests and, to the best of its knowledge, title to all of its interests are in good standing.

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SCOTTIE RESOURCES CORP. Notes to the Condensed Consolidated Interim Financial Statements For the three and six-month period ended February 28, 2023 and 2022 (Expressed in Canadian dollars)

7. MINERAL PROPERTIES (Cont’d…)

Mineral Property Acquisition Costs by Project

Project	As at		Cash		Shares		As at
	August 31, 2022						February 28, 2023
Bear Pass $	285,619	$	-	$	-	$	285,619
Cambria1	5,744,787		50,500		-		5,795,287
Georgia River	199,155		-		-		199,155
Scottie Gold Mine	3,454,302		52,000		754,500		4,260,802
Silver Crown	4,472,439		-		-		4,472,439
Tide North	18,009		-		-		18,009
TOTAL $	14,174,311	$	102,500	$	754,500	$	15,031,311
Project	As at		Cash		Shares		As at
	August 31, 2021						August 31, 2022
Bear Pass $	285,619	$	-	$	-	$	285,619
Cambria1	5,744,787		-		-		5,744,787
Georgia River	199,155		-		-		199,155
Scottie Gold Mine	1,711,802		1,650,000		92,500		3,454,302
Silver Crown	4,472,439		-		-		4,472,439
Tide North	18,009		-		-		18,009
TOTAL $	12,431,811	$	1,650,000	$	92,500	$	14,174,311

1Includes Bitter Creek, Black Hills, Champion South (formerly Silver Crown), Confluence, Dorothy 2, Independence, Lower Bear properties (Bay Silver and Lower Bear), and Ruby Silver.

Scottie Gold Mine Project

Summit Lake

On April 26, 2019, the Company entered into an option agreement to acquire a 100% interest in the Summit Lake property. To complete the option, the Company must:

• a) Make cash payments to the vendor as follows:

• i) $50,000 on TSX-V approval of the option agreement (paid) ; ii) $50,000 on or before April 26, 2020 (paid) ;

• iii) $50,000 on or before April 26, 2021 (paid) ;

• iv) $50,000 on or before April 26, 2022 (paid) ; and

• v) $50,000 on or before April 26, 2023 (paid)

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SCOTTIE RESOURCES CORP. Notes to the Condensed Consolidated Interim Financial Statements For the three and six-month period ended February 28, 2023 and 2022 (Expressed in Canadian dollars)

7. MINERAL PROPERTIES (Cont’d…)

Scottie Gold Mine Project (Cont’d…)

Summit Lake (Cont’d…)

• b) Issue shares of the Company to the vendor as follows:

• i) 200,000 shares TSX-V approval of the option agreement (issued) ;

• ii) 400,000 shares on or before April 26, 2020 (issued) ;

• iii) 500,000 shares on or before April 26, 2021 (issued) ;

• iv) 500,000 shares on or before April 26, 2022 (issued) ; and v) 600,000 shares on or before April 26, 2023. (issued)

During the six-month period ended February 28, 2023, the Company closed a royalty purchase agreement pursuant to which the Company purchased 100% of a 1.8% gross smelter return royalty on the Summit Lake property. In consideration of the purchase, the Company issued 2,500,000 common shares to the vendor with a fair value of $637,500.

During the year ended August 31, 2022, the Company purchased a 3.0% NSR which was previously held by a third-party over certain Summit Lake Property claims for $1,600,000.

During the year ended August 31, 2022, the Company entered into an option agreement with Europacific Metals Inc. (Formerly Goldplay Mining Inc.) (“Europacific”) whereas Europacific could acquire up to 3.75% interest in the Company’s Summit Lake project by incurring up to $1,500,000 in exploration expenses on the project until December 31, 2022 (the “Option”).

Following the completion of the earn-in of the Option, Europacific had the right (the “Put Right”) to require Scottie to repurchase the interest earned by Europacific by paying cash, at a price calculated by dividing the total exploration expenditures incurred by Europacific by 1.7 and Scottie had the right (the “Call Right”) to repurchase the interest earned by Europacific by paying cash, at a price calculated by dividing the total exploration expenditures incurred by Europacific by 1.7.

Europacific incurred exploration expenditures of $1,005,311 during the six month period ended February 28, 2023 and $574,789 during the year ended August 31, 2022, for total cumulative exploration expenditures of $1,580,000. Following the completion of the earn-in of the option Europacific exercised the Put Right and the Company repurchased the earned interest on the Summit Lake project for $900,000. Consequently, the Company recognized $564,765 of exploration expenditures during the six month period ended February 28, 2023 (August 31, 2022 - $335,235), representing the exploration expenditures incurred by Europacific divided by the Put Right repurchase rate.

Cambria Project

Bitter Creek

On March 1, 2019, the Company entered into an option agreement to acquire a 100% interest in the Bitter Creek property, contiguous with the Company’s Black Hills and Ruby Silver properties. In 2020, the Company completed its purchase obligations on the property to earn the 100% interest after renegotiation of the initial option agreement and payment of $325,000 in cash and issuance of 1,000,000 shares valued at $235,000.

Bitter Creek is subject to a 2.5% NSR, 60% of which can be purchased for $1,500,000.

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SCOTTIE RESOURCES CORP. Notes to the Condensed Consolidated Interim Financial Statements For the three and six-month period ended February 28, 2023 and 2022 (Expressed in Canadian dollars)

7. MINERAL PROPERTIES (Cont’d…)

Black Hills

In 2013, the Company purchased certain tenures of the Black Hills mineral claims for $10,000. In 2018, the Company staked additional claims at Black Hills for a cost of $1,680. The Company currently owns 100% of the property.

Champion South

The Champion South property was obtained through the acquisition of AUX and has been optioned out to Mountain Boy Minerals Ltd. (“MBM”) who completed their earn-in on the property during 2021. The original vendors retain a 2% NSR, one half of which can be purchased for $1,000,000 with a minimum advance annual royalty of $50,000 to begin after seven years.

Confluence

On October 22, 2020, the Company entered into an agreement to purchase 100% of the Confluence mineral claim tenure for $1,000 cash.

Dorothy 2

The Dorothy 2 property option agreement was obtained through the acquisition of AUX. The original vendors retain a 2.5% NSR, one half of which can be purchased for $1,000,000 until 90 days after the start of commercial production. The Company is required to keep the property in good standing and carry out $150,000 of exploration work over 4 years.

Lower Bear Properties

The Lower Bear properties, including the Bay Silver property, were obtained through the acquisition of AUX. The original vendors retain a 2% NSR, one half of which can be purchased for $1,000,000 with a minimum advance annual royalty of $50,000 to begin after seven years.

Ruby Silver

In 2018, the Company purchased a 100% interest in the Ruby Silver property for $100,000.

Independence Project and Silver Crown

The Company obtained an option to acquire a 100% interest in the Independence and Silver Crown projects through the acquisition of AUX. To complete the option, the Company must:

• a) Make cash payments to the vendor as follows:

• i) $200,000 on closing of the AUX financing on July 6, 2020 (paid) ; ii) $50,000 on or before July 6, 2021 (paid) ; iii) $50,000 on or before July 6, 2022 (paid);

• iv) $75,000 on or before July 6, 2023;

• v) $125,000 on or before July 6, 2024; and

• vi) $150,000 on or before July 6, 2025.

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SCOTTIE RESOURCES CORP. Notes to the Condensed Consolidated Interim Financial Statements For the three and six-month period ended February 28, 2023 and 2022 (Expressed in Canadian dollars)

7. MINERAL PROPERTIES (Cont’d…)

• b) Issue shares of the Company to the vendor as follows:

• i) 3,000,000 shares within 5 days of execution of the agreement (issued) ;

• ii) 250,000 shares on or before July 6, 2021 (issued) ;

• iii) 250,000 shares on or before July 6, 2022;

• iv) 500,000 shares on or before July 6, 2023;

• v) 1,000,000 shares on or before July 6, 2024; and

• vi) 3,000,000 shares on or before July 6, 2025.

The vendors will retain a 1.8% NSR, 0.8% of which can be purchased for $1,500,000 until 90 days after the start of commercial production.

Georgia River Project

Exdale

The Exdale property was obtained through the acquisition of AUX. The original vendor retains a 2% NSR.

Georgia River

The Georgie River properties were obtained through the acquisition of AUX.

Bear Pass Project

Bayview/Comet

The Bayview/Comet properties were obtained through the acquisition of AUX. The original vendor retains a 1% NSR.

Rufus

The Company obtained a 75% interest in the Rufus property through the acquisition of AUX. The original vendors retain a 2% NSR, one half of which can be purchased for $1,000,000 until 90 days after the start of commercial production.

West George Copper

The Company obtained a 40% interest in the West George Copper property in the acquisition of AUX, which will be retained until Mountain Boy Minerals (“MBM”) completes Feasibility on the property, at which time the 40% interest will revert to MBM.

The Company holds a 2% NSR, of which 1% can be purchased by MBM for $1,000,000.

Acquisition of AUX Resources Corporation

On July 16, 2021, the Company completed the acquisition of AUX Resources Corporation. The transaction included the acquisition of all the mineral properties and mineral property options held by AUX, expanding and consolidating the Company’s holdings in the Golden Triangle of British Columbia.

Consideration with a fair value of $12,753,132 was issued in exchange for all of the issued and outstanding equity of AUX and is comprised of:

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SCOTTIE RESOURCES CORP. Notes to the Condensed Consolidated Interim Financial Statements For the three and six-month period ended February 28, 2023 and 2022 (Expressed in Canadian dollars)

7. MINERAL PROPERTIES (Cont’d…)

Acquisition of AUX Resources Corporation (Cont’d…)

• 54,499,642 common shares of the Company at $0.215 per share ($11,717,422);

• 18,433,817 warrants of the Company with fair values between $0.0209 and $0.0451 per warrant ($656,675) (Note 10c contains a summary of the assumptions used to calculate fair values); and

• 2,432,000 stock options of the Company with fair values between $0.0896 and $0.1938 per stock option ($379,035) (Note 10c contains a summary of the assumptions used to calculate fair values)

The transaction was accounted for as an asset purchase of mineral property interests and $9,922,969 was allocated to the fair value of exploration and evaluation assets.

8. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

As at	February 28,	August 31,
	2023	2022
Accounts payable Accrued liabilities Payroll liability Amounts payable to related parties (Note 11) TOTAL	$ 242,867 47,263 2,898 114,272 $ 407,300	$ 1,789,179 491,052 2,898 671,632 $ 2,954,761

9. FLOW THROUGH SHARE LIABILTY AND RECOVERY OF FLOW THROUGH PREMIUM

During the six month period ended February 28, 2023, the Company:

• Incurred eligible flow through expenditures of $1,300,282 (2022 – $4,261,254).

• Reported a recovery of flow through premium of $286,993 (2022 – $157,824), and as at February 28, 2023 had a remaining flow through liability of $1,330,013 (August 31, 2022 – $302,671).

As at February 28, 2023, the Company had $4,087,250 in unspent flow through funds (August 31, 2022 – $1,387,382).

In accordance with the flow through share agreements, the Company may be required to indemnify the holders of any such shares any tax and other costs payable to them in the event the Company does not fulfill its flow through expenditure requirements.

10. SHARE CAPITAL

a) Authorized

An unlimited number of common shares without par value.

b) Share Issuance

At February 28, 2023 the Company had 265,956,067 common shares issued and outstanding (August 31, 2022 – 221,733,537).

16

SCOTTIE RESOURCES CORP. Notes to the Condensed Consolidated Interim Financial Statements For the three and six-month period ended February 28, 2023 and 2022 (Expressed in Canadian dollars)

10. SHARE CAPITAL (Cont’d…)

b) Share Issuance (Cont’d…)

During the six month period ended February 28, 2023, the Company:

• Closed a non-brokered private placement consisting of 18,823,530 units (the “Units”) at a price of $0.17 per Unit for gross proceeds of $3,200,000. Each Unit consists of one common share of the Company, and one common share purchase warrant (a “Warrant”). Each Warrant entitles the holder to purchase an additional common share at an exercise price of $0.25 per common share for a period of two years.

The Company paid finder’s fees of $139,281 in cash and issued 819,300 finder’s warrants. Each warrant will entitle the holder to purchase one common share of the Company at a price of $0.25 per common share for a period of two years.

• Issued 600,000 common shares in respect of property option agreements on the Summit Lake property, valued at $117,000, which has been recorded as property acquisition costs (Note 7).

• Issued 2,500,000 common shares with a fair value of $637,500 in consideration of a royalty purchase agreement (Note 7).

• Closed a brokered private placement consisting of 11,429,000 flow-through common shares at a price of $0.35 per flow-through common share and 10,870,000 common shares at a price of $0.23 per common share for gross proceeds of $6,500,250.

The Company paid finder’s fees of $398,023 in cash and issued 1,142,287 finder’s warrants. Each warrant will entitle the holder to purchase one common share of the Company at a price of $0.23 per common share for a period of two years.

During the year ended August 31, 2022, the Company:

• Issued 500,000 common shares in respect of property option agreements on the Summit Lake property, valued at $92,500, which has been recorded as property acquisition costs (Note 7).

• Closed private placements consisting of 10,000,000 flow-through shares at a price of $0.30 per flow-through share, 4,000,000 flow-through shares at a price of $0.25 per flow-through share, and 4,800,000 common shares at a price of $0.21 per common share for aggregate gross proceeds of $5,008,000.

The Company paid share issuance costs of $504,416 and issued 1,128,000 finders’ warrants valued at $65,145. Each finders’ warrant is exercisable into a common share at a price of $0.30 per share for a period of 24 months. The finders’ warrants were valued using the following BlackScholes Option-Pricing Model assumptions: expected life of 2 years, an expected dividend of $nil, a risk-free interest rate of 2.65%, and an expected volatility of 70.30%.

The Company recorded a $1,130,000 flow through premium associated with the flow-through shares issued.

17

SCOTTIE RESOURCES CORP. Notes to the Condensed Consolidated Interim Financial Statements For the three and six-month period ended February 28, 2023 and 2022 (Expressed in Canadian dollars)

10. SHARE CAPITAL (Cont’d…)

c) Stock Options Outstanding

The Company has a shareholder-approved stock option plan that provides for the reservation for issuance of 20% of the Company’s issued and outstanding common shares to its directors, officers, employees, and consultants. The vesting terms of each stock option grant is determined by the Board of Directors at the time of the grant.

The stock option continuity for the period ended February 28, 2023 is as follows:

					Number				Weighted Avg
Number					Outstanding				Remaining
Outstanding				Expired/	February 28,	Exercise Price			Contractual Life
August 31, 2022	Granted	Exercised		Cancelled	2023		per Share	Expiry Date	(inyears)
150,000	-		-	(150,000)	-	$	0.26	Oct 26, 2022	-
600,000	-		-	-	600,000	$	0.26	Mar 8, 2023*	0.02
1,000,000	-		-	-	1,000,000	$	0.10	Dec 3, 2023	0.76
100,000	-		-	-	100,000	$	0.23	Feb 3, 2024	0.93
1,000,000	-		-	-	1,000,000	$	0.22	Apr 24, 2024	1.16
1,400,000	-		-	-	1,400,000	$	0.20	Sep 17, 2024	1.55
3,425,000	-		-	-	3,425,000	$	0.22	May 25, 2025	2.24
1,650,000	-		-	(100,000)	1,550,000	$	0.42	Jul 8, 2025	2.36
250,000	-		-	-	250,000	$	0.26	Jan 13, 2026	2.88
2,100,000	-		-	-	2,100,000	$	0.25	Apr 19, 2026	3.14
100,000	-		-	-	100,000	$	0.25	May 21, 2026	3.23
1,100,000	-		-	-	1,100,000	$	0.23	Mar 22, 2027	4.06
-	2,354,000		-	-	2,354,000	$	0.18	Sep 8, 2027	4.53
-	4,850,000		-	-	4,850,000	$	0.28	Jan 16, 2028	4.88
12,875,000	7,204,000		-	(250,000)	19,829,000	$	0.24	(weighted	3.13
								average)
				Exercisable	13,876,000	$	0.24	(weighted	2.45
								average)

*Subsequent to the period ended February 28, 2023, 600,000 options expired unexercised.

18

SCOTTIE RESOURCES CORP. Notes to the Condensed Consolidated Interim Financial Statements For the three and six-month period ended February 28, 2023 and 2022 (Expressed in Canadian dollars)

The stock option continuity for the year ended August 31, 2022 is as follows:

									Weighted Avg
Number					Number				Remaining
Outstanding				Expired/	Outstanding	Exercise Price			Contractual Life
August 31, 2021	Granted	Exercised		Cancelled	August 31, 2022		per Share	Expiry Date	(inyears)
300,000	-		-	(300,000)	-	$	0.20	May 24, 2022	-
150,000	-		-	-	150,000	$	0.26	Oct 26, 2022	0.15
600,000	-		-	-	600,000	$	0.26	Mar 8, 2023	0.52
1,000,000	-		-	-	1,000,000	$	0.10	Dec 3, 2023	1.26
1,000,000	-		-	-	1,000,000	$	0.22	Apr 24, 2024	1.65
2,400,000	-		-	(1,000,000)	1,400,000	$	0.20	Sep 17, 2024	2.05
100,000	-		-	-	100,000	$	0.23	Feb 3, 2024	1.43
3,625,000	-		-	(200,000)	3,425,000	$	0.22	May 25, 2025	2.73
300,000	-		-	(50,000)	250,000	$	0.26	Jan 13, 2026	3.37
2,100,000	-		-	-	2,100,000	$	0.25	Apr 19, 2026	3.64
100,000	-		-	-	100,000	$	0.25	May 21, 2026	3.72
80,000	-		-	(80,000)	-	$	0.25	Sep 24, 2024	2.07
80,000	-		-	(80,000)	-	$	0.25	Feb 8, 2027	4.44
72,000	-		-	(72,000)		$	0.30	Jul 7, 2024	1.85
2,200,000	-		-	(550,000)	1,650,000	$	0.42	Jul 8, 2025	2.85
-	1,100,000		-	-	1,100,000	$	0.23	Mar 22, 2027	4.56
14,107,000	1,100,000		-	(2,332,000)	12,875,000	$	0.24	(weighted	2.66
								average)
				Exercisable	11,500,000	$	0.24	(weighted	2.47
								average)

Stock-Based Compensation

The fair value of each option granted to employees, officers, and directors was estimated on the date of the grant using the Black-Scholes Option-Pricing Model.

During the six month period ended February 28, 2023, the Company granted 7,204,000 (2022 – nil) stock options.

The Company recorded $622,268 in stock-based compensation expense (2022 - $107,531) for options granted and vested during the period.

The assumptions used in the Black-Scholes Option-Pricing Model for the relative fair value allocation were:

Grant Date	Jan 17, 2023 Sep 8, 2022 Mar 22, 2022
Expiry Date Jan 17, 2028 Sep 8, 2027 Mar 22, 2027 Expected life (years) 5 5 5 Expected dividend $ nil $ nil $ nil Risk-free interest rate 2.93% 3.37% 2.25% Expected volatility 104.80% 91.04% 117.00% Fair value $0.21 $0.13 $0.16

19

SCOTTIE RESOURCES CORP. Notes to the Condensed Consolidated Interim Financial Statements For the three and six-month period ended February 28, 2023 and 2022 (Expressed in Canadian dollars)

10. SHARE CAPITAL (Cont’d…)

Share Purchase Warrants

The share purchase warrant continuity for the six-month period ended February 28, 2023 is as follows:

				Number				Weighted Avg
Number				Outstanding				Remaining
Outstanding			Expired/	February 28,	Exercise Price			Contractual Life
August 31, 2021	Granted	Exercised	Cancelled	2023	per Share		Expiry Date	(inyears)
1,560,000	-	-	-	1,560,000	$	0.25	Jun 1, 2023	0.25
11,234,889	-	-	(11,234,889)	-	$	0.40	Feb 11, 2023	-
1,128,000	-	-	-	1,128,000	$	0.30	April 22, 2024	1.15
-	18,823,530	-	-	18,823,530	$	0.25	Sep 26, 2024	1.58
-	819,300	-	-	819,300	$	0.25	Oct 7, 2024	1.61
-	1,142,287	-	-	1,142,287	$	0.23	Feb 16,2025	1.97
13,922,889	20,785,117	-	(11,234,889)	23,473,117	$	0.25	(weighted	1.49
							average)

The share purchase warrant continuity for the year ended August 31, 2022 is as follows:

								Weighted Avg
Number				Number				Remaining
Outstanding			Expired/	Outstanding	Exercise Price			Contractual Life
August 31, 2021	Granted	Exercised	Cancelled	August 31, 2022	per Share		Expiry Date	(inyears)
10,600,000	-	-	(10,600,000)	-	$	0.30	Jan 16, 2022	-
758,457	-	-	(758,457)	-	$	0.24	May 14, 2022	-
2,332,000	-	-	(2,332,000)	-	$	0.34	Jun 8, 2022	-
1,560,000	-	-	-	1,560,000	$	0.25	Jun 1, 2023	0.75
7,198,928	-	-	(7,198,928)	-	$	0.40	Jul 6, 2022	-
11,234,889	-	-	-	11,234,889	$	0.40	Feb 11, 2023	0.45
-	1,128,000	-	-	1,128,000	$	0.30	April 22,2024	1.64
33,684,274	1,128,000	-	(20,889,385)	13,922,889	$	0.38	(weighted	0.58
							average)

The assumptions used in the Black-Scholes Option-Pricing Model for the relative fair value allocation were:

Grant Date	Feb 16, 2023	Oct 7, 2022	Apr 22, 2022
Expiry Date	Feb, 16 2025	Oct 7, 2024	Apr 22, 2024
Expected life (years)	2	2	2
Expected dividend	$ nil	$ nil	$ nil
Risk-free interest rate	4.14%	4.05%	2.65%
Expected volatility	62.15%	64.95%	70.30%
Fair value	$0.09	$0.06	$0.06

20

SCOTTIE RESOURCES CORP. Notes to the Condensed Consolidated Interim Financial Statements For the three and six-month period ended February 28, 2023 and 2022 (Expressed in Canadian dollars)

11. RELATED PARTY TRANSACTIONS

The Company’s related parties consist of companies with directors and officers in common, and companies owned in whole or in part by executive officers and directors as follows:

Related Party Name	Nature of Transactions
Red Fern Consulting Ltd. (“Red Fern”), a company	Consulting as CFO
related to Stephen Sulis
Rhodanthe Corporate Services (“Rhodanthe”), a	Consulting as Corporate Secretary
companyrelated to Christina Boddy
Slater Corporate Services Corporation (“Slater”), a	Consulting as Former CFO
companyrelated to Lisa Peterson
Serac Exploration Ltd. (“Serac”), a company related to	Geological consulting
BradleyRourke and Thomas Mumford
YMI Inc.(“YMI”),a companyrelated to BradleyRourke	Consultingas CEO

The Company incurred the following fees in connection with key management compensation and expenses incurred from companies owned or partially owned by key management (Chief Executive Officer, Chief Financial Officer, Corporate Secretary) and/or directors. Expenses have been measured at the exchange amount, which is determined on a cost recovery basis.

For the six-monthperiod ended February 28,	2023	2022
Professional fees – Red Fern Professional fees – Rhodanthe Professional fees – Slater Exploration Expenses – Serac Management fees – YMI TOTAL	$ 45,100 18,000 - 520,311 100,000 $ 683,411	$ 19,500 18,000 45,000 259,551 60,000 $ 402,051

In addition to the fees paid above, the Company recognized $360,071 (2022 - $76,616) in share-based compensation related to the granting and vesting of stock options to the officers and directors of the Company

Amounts owing to directors and officers and companies with directors and officers in common are disclosed in Note 8. All amounts are unsecured, with no specific terms of repayment.

12. SEGMENT DISCLOSURE

The Company has one reportable operating segment in Canada which operates in the acquisition, exploration and evaluation of mineral resources. All of the Company’s non-current assets are located in Canada.

13.

MANAGEMENT OF CAPITAL

The Company manages its common shares, stock options and warrants as capital (Note 10). The Company’s objectives when managing capital are to safeguard the Company’s ability to continue as a going concern in order to pursue acquisition, exploration and evaluation of mineral properties and to maintain a flexible capital structure which optimizes the costs of capital at an acceptable level of risk.

21

SCOTTIE RESOURCES CORP. Notes to the Condensed Consolidated Interim Financial Statements For the three and six-month period ended February 28, 2023 and 2022 (Expressed in Canadian dollars)

13. MANAGEMENT OF CAPITAL (Cont’d…)

The Company manages the capital structure and adjusts it in light of changes in economic conditions and the risk characteristics of the underlying assets. To maintain or adjust the capital structure, the Company may attempt to issue new shares, issue debt, acquire or dispose of assets, or adjust the amount of cash.

To facilitate the management of its capital requirements, the Company prepares expenditure budgets that are updated as necessary depending on various factors including successful capital deployment and general industry conditions.

To maximize ongoing exploration expenditures, the Company does not pay dividends. The Company’s investment policy is to keep its cash treasury on deposit in interest-bearing Canadian chartered bank accounts and short-term guaranteed investment certificates.

The Company estimates that it will require additional funding to carry out its exploration plans and operations through the next twelve months. The Company is not subject to any externally imposed capital restrictions. There were no changes to the Company’s approach to capital management.

14. SUPPLEMENTAL DISCLOSURE WITH RESPECT TO CASHFLOWS

For the six-month period ended,		February 28,	February 28,
		2023	2022
Non-cash investing and financing activities:
Shares issued under property acquisition option agreements.	$	117,000 $	-
Shares issued for royalty acquisition		637,500	-
Broker warrants issued as share issuance costs		153,582	-
Share issuance costs in accounts payable		126,645	-
Sale of equipment in accounts receivable		20,000	-

15. SUBSEQUENT EVENTS

Subsequent to the period ended February 28, 2023, the Company granted an additional 230,484 finders warrants at a price of $0.23 per finders warrant for a period of 24 months from the date of issuance. The finders warrants were issued in connection with the brokered private placement financing which closed February 28, 2023.

22