Southern Silver Exploration Corp. — Management Reports 2021

Aug 31, 2021

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1100 – 1199 West Hastings Street, Vancouver, BC, V6E 3T5 Tel: 604-684-9384 www.southernsilverexploration.com

Management’s Discussion and Analysis For the Year Ended April 30, 2021 Dated: August 30, 2021

A	Introduction	2
B	Qualified Person	2
C	Foreign Exchange Information and Conversion Tables	2
D	Summary of Mineral Properties	3
E	Results of Operations	9
F	Summary of Quarterly Results	9
G	Fourth Quarter	10
H	Summary of Annual Information	10
I	Related Party Transactions	11
J	Financial Condition, Liquidity and Capital Resources	12
K	Outstanding Equity and Convertible Securities	12
L	Financial Instruments	14
M	Events After the Reporting Period and Outlook	14
N	Off-balance Sheet Arrangements	14
O	Disclosure Controls and Procedures	15
P	Risks and Uncertainties	15
Q	Proposed Transactions	18
R	Forward-Looking Statements	18

Southern Silver Exploration Corp. (An Exploration Stage Company) Management’s Discussion and Analysis For the Year Ended April 30, 2021

A. Introduction

The following Management’s Discussion and Analysis (“MD&A”) of the consolidated operating results and financial condition of Southern Silver Exploration Corp. (the “Company”) is for the year ended April 30, 2021 and is dated August 30, 2020. This MD&A was prepared to conform to National Instrument (“NI”) 51-102F1 and was approved by the Board of Directors prior to its release.

This analysis should be read in conjunction with the Company’s audited consolidated financial statements for the year ended April 30, 2021, and the accompanying notes, which have been prepared in accordance with International Financial Reporting Standards (“IFRS”).

The Company’s shares trade on the TSX Venture Exchange (“SSV”), the Santiago Stock Exchange, Venture (“SSVCL”) and the OTCQX Best Market (“SSVFF”).

The Company’s functional and reporting currency is the Canadian dollar and all dollar amounts included herein are in Canadian dollars, unless otherwise indicated.

Additional information relating to the Company is available at www.southernsilverexploration.com and on SEDAR at www.sedar.com.

B. Qualified Person

Robert W. J. Macdonald, P. Geo., is the qualified person as defined by National Instrument 43-101 responsible for the technical information included in this MD&A and the supervision of work done in association with the exploration and development programs. Mr. Macdonald graduated with a B.Sc. degree from Memorial University of Newfoundland and a M.Sc. from the University of British Columbia. His work has focused on vein and intrusive-related gold systems and massive sulphide deposits.

C. Foreign Exchange Information and Conversion Tables

For ease of reference, the following information is provided:

Canadian Dollars per US Dollar	Canadian Dollars per US Dollar	Canadian Dollars per US Dollar		Conversion Table	Conversion Table	Conversion Table
	Year
	Ended
	April	30	Imperial			Metric
	2021	2020
Rate at end of period	1.2284	1.3910	1 acre		=	0.404686	hectares
Average rate for period	1.3087	1.3363	1 foot		=	0.304800	meters
			1 mile		=	1.609344	kilometres
			1 ton		=	0.907185	tonnes
			1 Ounce (troy)/ton		=	34.285700	g/t

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Southern Silver Exploration Corp. (An Exploration Stage Company) Management’s Discussion and Analysis For the Year Ended April 30, 2021

C. Foreign Exchange Information and Conversion Tables, continued

Precious metal units and conversion factors	Precious metal units and conversion factors
ppb - Part per billion ppm - Part per million oz - Ounce (troy) oz/t - Ounce per ton (avdp.) g - Gram g/t - gram per metric ton mg - milligram kg - kilogram ug - microgram	1 ppb = 0.0010 ppm = 0.000030 oz/t 100 ppb = 0.1000 ppm = 0.002920 oz/t 10,000 ppb = 10.0000 ppm = 0.291670 oz/t 1 ppm = 1.0000 ug/g = 1.000000 g/t 1 oz/t = 34.2857 ppm 1 Carat = 41.6660 mg/g 1 ton (avdp.) = 907.1848 kg 1 oz(troy) = 31.1035 g

D. Summary of Mineral Properties

The Company’s principal business activities include the acquisition, exploration, and development of natural resource properties for enhancement of value and disposition pursuant to sales agreements or development by way of third-party option and/or joint venture agreements.

The Company is continuing to advance its core asset - Cerro Las Minitas - a silver-lead-zinc property located in Durango State, Mexico. The property is a large land position and lies within the prolific Faja de Plata (Belt of Silver) of north central Mexico. On September 15, 2020, the Company closed a transaction with Electrum Global Holdings L.P. (“Electrum”) to acquire Electrum’s 60% indirect interest in the project for consideration of US$15,000,000 in a combination of cash and common shares. The transaction now gives the Company complete ownership and full control of the Cerro Las Minitas project.

The Company also continues to advance Oro, a gold-silver-copper-lead-zinc property located in New Mexico, USA, that features a classic porphyry zonation within the highly prospective Laramide Porphyry belt of the southern USA and the El Sol silver-lead-zinc claim which covers the northwest projection of the Blind and El Sol zones at the Cerro Las Minitas project, Durango, Mexico .

Cerro Las Minitas - Durango, Mexico

The property is located about 70 kilometres to the northeast of the city of Durango in Durango State, Mexico, and is accessed easily by road. The property comprises twenty-five concessions totaling approximately 34,415 hectares in one of the most significant silver producing regions in the world.

Four separate mineral deposits have been identified with the Blind, the El Sol and the Las Victorias deposits forming sets of sub-parallel, northwest-trending and steeply dipping mineralized zones which are traced for over 1,300 metres strike and up to 600 metres depth. The fourth deposit known as the Skarn Front, forms beneath the Blind, El Sol and Las Victorias deposits and is localized on the outer edge of the skarn alteration zone surrounding a Central Monzonite Intrusion and has been drilled along an approximate 1,100 metre strike length and to depths of up to 1,000 metres.

Mineralization occurs as massive-sulphide pipes, veins and replacements in sub-vertical structures that demonstrate good continuity between drill holes. Mineralization is open on-strike and at depth in a similar geological environment to that of major Mexican Carbonate Replacement Deposits (CRDs) such as Santa Eulalia (45Mt of 310g/t Ag, 7.1% Zn and 8.2% Pb) and Skarn deposits such as San Martin (60Mt of 118g/t Ag, 0.9% Pb and 3.9% Zn).

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Southern Silver Exploration Corp. (An Exploration Stage Company) Management’s Discussion and Analysis For the Year Ended April 30, 2021

D. Summary of Mineral Properties, continued

Cerro Las Minitas - Durango, Mexico, continued

On May 9, 2019, the Company released an updated NI 43-101 mineral resource estimate for the project which, at a 175g/t AgEq cut-off, featured:

• Indicated Mineral resources of 134 million ounces silver equivalent or 2.0 billion pounds zinc equivalent which includes a 0.97Mt increase to 11.1Mt averaging 105g/t Ag, 0.1g/t Au, 0.16% Cu, 1.2% Pb and 3.7% Zn (375g/t AgEq; 8.2% ZnEq), containing: 37.5 million ounces of silver; 35 thousand ounces of gold; 40 million pounds of copper; 303 million pounds of lead; and 897 million pounds of zinc.

• Inferred Mineral resources of 138 million ounces silver equivalent or 2.0 billion pounds zinc equivalent which includes a significant increase to 12.8Mt averaging 111g/t Ag, 0.07g/t Au, 0.27% Cu, 0.9% Pb and 2.8% Zn (334g/t AgEq; 7.2% ZnEq) containing: 45.7 million ounces of silver; 31 thousand ounces of gold; 76 million pounds of copper, 253 million pounds of lead; and 796 million pounds of zinc.

Table 1: Base-case Mineral Resource Estimate Utilizing a 175g/t AgEq cut-off value:

Indicated
Zone	Tonnes	Ag	Cu	Pb	Zn	Au	AgEq	ZnEq	**Ag TrOz **	Au TrOz	Pb	Zn	**Cu Lbs **	AgEq TrOz	ZnEq Lbs
	(Kt)	(g/t)	(%)	(%)	(%)	(g/t)	(g/t)	(%)	(000's)	(000's)	(Mlbs)	(Mlbs)	(Mlbs)	(000's)	(Mlbs)
Blind Zone	2,007	103	0.12	2.0	2.3	0.04	310	8.0	6,647	3	90	103	5.2	19,983	354
El Sol Zone	978	83	0.09	2.3	2.2	0.04	291	7.5	2,600	1	50	47	2.0	9,168	162
Las Victorias	870	141	0.17	2.0	2.8	0.62	385	10.0	3,949	17	39	53	3.2	10,775	191
Skarn Front	7,246	104	0.19	0.8	4.3	0.06	403	8.1	24,290	14	125	694	29.7	93,965	1,299
Total	11,102	105	0.16	1.2	3.7	0.10	375	8.2	37,485	35	303	897	40	133,891	2,006
Inferred
Zone	Tonnes	Ag	Cu	Pb	Zn	Au	AgEq	ZnEq	**Ag TrOz **	Au TrOz	Pb	Zn	**Cu Lbs **	AgEq TrOz	ZnEq Lbs
	(Kt)	(g/t)	(%)	(%)	(%)	(g/t)	(g/t)	(%)	(000's)	(000's)	(Mlbs)	(Mlbs)	(Mlbs)	(000's)	(Mlbs)
Blind Zone	1,261	80	0.08	1.4	2.0	0.17	243	6.2	3,258	7	38	56	2	9,848	173
El Sol Zone	794	65	0.05	1.9	2.4	0.03	262	6.6	1,669	1	33	42	1	6,695	116
Las Victorias	216	180	0.06	2.7	2.1	0.90	416	11.0	1,252	6	13	10	0	2,892	53
Skarn Front	10,573	116	0.31	0.7	3.0	0.05	349	7.3	39,569	17	169	689	73	118,684	1,701
Total	12,844	111	0.27	0.9	2.8	0.07	334	7.2	45,749	31	253	796	76	138,119	2,043

Notes:

• 1) The current Resource Estimate was prepared by Garth Kirkham, P.Geo., of Kirkham Geosystems Ltd.

• 2) All mineral resources have been estimated in accordance with Canadian Institute of Mining and Metallurgy and Petroleum (“CIM”) definitions, as required under National Instrument 43-101 (“NI43-101”).

• 3) Mineral resources were constrained using mainly geological constraints and approximate 10g/t AgEq grade domains.

• 4) AgEq cut-off values were calculated using average long-term prices of $16.6/oz. silver, $1,275/oz. gold, $2.75/lb. copper, $1.0/lb. lead and $1.25/lb. zinc. Metal recoveries for the Blind, El Sol and Las Victorias deposits of 91% silver, 25% gold, 92% lead, 82% zinc and 80% copper and for the Skarn Front deposit of 85% silver, 18% gold, 89% lead, 92% zinc and 84% copper were used to define the cut-off grades. Base case cut-off grade assumed $75/tonne operating smelting and sustaining costs. All prices are stated in $USD.

• 5) Silver Equivalents were calculated from the interpolated block values using relative recoveries and prices between the component metals and silver to determine a final AgEq value. The same methodology was used to calculate the ZnEq value.

• 6) Mineral resources are not mineral reserves until they have demonstrated economic viability. Mineral resource estimates do not account for a resource’s mineability, selectivity, mining loss, or dilution.

• 7) All figures are rounded to reflect the relative accuracy of the estimate and therefore numbers may not appear to add precisely.

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Southern Silver Exploration Corp. (An Exploration Stage Company) Management’s Discussion and Analysis For the Year Ended April 30, 2021

D. Summary of Mineral Properties, continued

Cerro Las Minitas - Durango, Mexico, continued

The mineral resources at Cerro Las Minitas have systematically increased from the initial resource estimate in 2016. Since starting exploration on the project in 2011, the Company has completed, inclusive of the current drill program, 165 drill holes totaling over 72,000 metres. The Company recently announced it is doubling the size of the current drill program from an initial 10,000 metre to a 20,000-metre program. Drilling will continue with two drills targeting the east side of the Cerro where, to date, three near-surface sulphide lenses with Bonanza-grades of silver have been identified. Shallow oxide Au-Ag mineralization has also been confirmed in the Mina La Bocona area. Mineralization in all of these new target areas is separate from the existing mineral resources. The current program has completed 56 core holes totaling 22,360 metres since restarting drilling in September 2020. Drill targeting is designed to increase the current mineral resource estimate by approximately 30%. The project remains one of the larger undeveloped silver-lead-zinc projects in the world and is fully funded and permitted for the work.

Drill results from the South Skarn target returned high-grade mineralization which include:

• a 9.0m interval (6.7m est. True Thickness) averaging 625g/t Ag, 11.8% Pb and 7.5% Zn (1,454g/t AgEq; 30.0% ZnEq) including a higher grade 2.3m interval (1.7m est. TT) averaging 1,338g/t Ag, 25.9% Pb and 17.6% Zn (3,201g/t AgEq; 66.1% ZnEq) from drill hole 20CLM-119;

• a 3.7m interval (2.7m est. TT) averaging 511g/t Ag, 5.0% Pb and 3.7% Zn (907g/t AgEq; 18.7% ZnEq) from drill hole 20CLM-120; and

• a 15.6m interval (10.4m est. TT) averaging 172g/t Ag, 3.8% Pb and 3.7% Zn (520g/t AgEq; 10.7% ZnEq) including a higher grade 0.9m interval (0.6m est. TT) grading 975g/t Ag, 21.2% Pb and 18.5% Zn (2,830/t AgEq; 58.5% ZnEq) from drill hole 20CLM-124.

Results from the Mina La Bocona target from both the near-surface strongly gold-enriched oxidized mineralization and the deeper poly-metallic sulphide mineralization include:

• a 28.5m interval of oxide mineralization averaging 1.41g/t Au and 36g/t Ag (201g/t AgEq) including a higher grade 2.8m interval averaging 5.1g/t Au and 72g/t Ag (552 AgEq) starting at 23.8m down-hole;

• a 15.1m down-hole (8.0m est. TT) averaging 1,072g/t Ag, 18.8% Pb and 7.5% Zn (2,040g/t AgEq; 51.7% ZnEq);

• a 20.9m down-hole (9.0m est. TT) averaging 212g/t Ag, 0.64g/t Au, 3.7% Pb and 3.3% Zn (512g/t AgEq; 13.0% ZnEq) from the Bocona Chimney; and

• a 9.3m down-hole (6.1m est. TT) averaging 344g/t Ag, 0.59g/t Au. 5.7% Pb and 3.9% Zn (728g/t AgEq; 18.5% ZnEq).

Drilling has successfully established continuity at both targets and has now tested the full 850 metre strike-length of the east side of the Cerro to depths of up to 500 metres. Three bonanza grade mineralized zones have been identified as well as shallow intercepts of high-grade mineralization to the northwest of the Bocona target.

Final assays have been received from the Mina La Bocona and South Skarn targets which are in the process of being incorporated into the upcoming mineral resource update on the project, the results of which are expected in early Q4 2021.

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Southern Silver Exploration Corp. (An Exploration Stage Company) Management’s Discussion and Analysis For the Year Ended April 30, 2021

• D. Summary of Mineral Properties, continued

Cerro Las Minitas - Durango, Mexico, continued

Metallurgical test work on representative composites from the Cerro Las Minitas mineral deposits was conducted by Blue Coast Research of Parksville, BC which visited the project in October 2017 to supervise the selection of samples for use in the study. Representative samples of the Blind – El Sol oxides and sulphides as well as the Skarn Front sulphides were collected from drill core and combined into three distinct composites to represent the three different styles of mineralization currently identified on the project. Test work included sample characterization and batch flotation tests. A limited cyanidation test program was conducted on the Blind – El Sol oxide composite. Sample characterization of the composites included head analyses, chemical characterization, modal mineralogy determinations (including microprobe work) and Bond Ball Work Index tests.

The batch test work generated high-grade lead and zinc concentrates from the Blind-El Sol deposits, but produced a diluted zinc concentrate from test work on the Skarn Front deposit. Further batch test work successfully optimized the flotation sequence, upgraded the zinc concentrate by removing the chalcopyrite and created a separate copper concentrate.

In mid-2019, the Company collected additional sample material from the Skarn Front zone including +200kg of sample for lock-cycle testing on a master composite and variability testing on seven additional smaller sub-sets of the Skarn Front mineralization.

The locked-cycle test work, as reported in January 2020, was based on the open circuit flowsheet established in the earlier batch test work. Owing to the lower copper content of the master composite, a larger scale batch cleaner test was conducted to establish the copper metallurgy. Results from the locked-cycle test were combined with the copper cleaner test work to create an overall metallurgical projection for the Skarn Front composite as follows:

• 83.6% Pb and 77.3% Ag into the lead concentrate assaying 65.1% Pb and 5,504g/t Ag respectively after three stages of cleaning; and

• 94.7% Zn and 8.0% Ag into the zinc concentrate assaying 54.0% Zn and 92g/t Ag respectively after three stages of cleaning; and

• 60.2% Cu and 6.5% Ag into the copper concentrate assaying 27.0% Cu and 1,255g/t Ag respectively after three stages of cleaning;

These latest test results complement previously reported recoveries from the Blind – El Sol sulphide composite which recovered:

• 82% Ag, 90% Pb and 4% Zn into a lead concentrate assaying 2,880ppm Ag, 68% Pb and 2% Zn; and

• 78% Zn into a zinc concentrate assaying 52% Zn.

The combined results from the Blind – El Sol and the Skarn Front deposits provide very favorable recoveries and grades of silver, lead and zinc which form the initial basis for a metallurgical processing flowsheet which in turn, can be used in the further evaluation and scoping of the project. Variability test work on Skarn Front deposit confirmed that the Cu-Pb-Zn flotation circuit accommodates large swings in both overall grade and sulphide content and can effectively handle head grades ~6x higher than average using only reagent dosage control.

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Southern Silver Exploration Corp. (An Exploration Stage Company) Management’s Discussion and Analysis For the Year Ended April 30, 2021

D. Summary of Mineral Properties, continued

El Sol - Durango, Mexico

The El Sol concession is a single 63 hectare claim strategically located on the northwestern boundary of the Bocona block of claims and is adjacent to the Area of the Cerro which hosts the four mineral deposits currently identified within the Cerro Las Minitas claim package. It covers an important northwest projection of the Blind-El Sol deposits and potentially at least one additional mineralized structure. The claim is largely gravel covered with previous work including: airborne magnetic geophysics; surface soil and acacia sampling; limited dump sampling of historic artisanal workings and a single core hole in the southeastern end of the property.

A drill hole, from 2013, intersected thick intervals of aplite and monzonite with associated grossular skarn and re-crystallized limestone which corresponds well to the projection of the Blind Zone deposit and returned anomalous Ag-Pb-Zn values with associated pathfinder elements. Additional exploration potential exists, both down dip of the initial drill intercepts and on-strike to the northwest where the projected structure crosses two large magnetic anomalies located on the claim.

Select dump sampling of artisanal workings located to the northeast of the Blind Zone structure returned anomalous values from several strongly oxidized and silicified rocks including sample CLM-316 which returned 0.67g/t Au, 559g/t Ag, 3.3% Pb and 4.3% Zn. These workings do not appear to be related to the Blind Zone mineralization and represent a second potential high-grade target for priority follow-up.

Exploration on the El Sol claim has started with up to 3,000 metres of drilling planned on this concession which sits adjacent to the CLM claim group and covers the northerly projection of previously identified mineralization in the Blind Zone deposits and a second area of artisanal workings.

Oro - New Mexico, USA

The Oro property comprises a contiguous block of Federal, State and private land in the historic Eureka mining district in Grant County, New Mexico and is located approximately 80 kilometres southwest of the Silver City porphyry copper district. The claims surround a highly prospective zone of quartz-sericite-pyrite alteration footprint, interpreted to overlie an unexposed porphyry centre. Classic porphyry system zonation is indicated by surface gold and copper mineralization associated with Laramide-age intrusions in this core area, flanked by lead-zinc skarn mineralization and distal sediment-hosted gold occurrences. In addition to bulk-tonnage porphyry copper-molybdenum-gold potential, the property also includes the sediment-hosted gold mineralization Stockpond target located 3 kilometres to the northeast of the porphyry system.

In October 2017 the company completed the second phase of a 17-hole reverse circulation (RC) drill program on the Stockpond gold target which intersected thick horizons of strongly silicified and hematite-rich sediments in eight of nine holes drilled, with the higher gold grades spatially associated with zones of strong silicification. The strongest values were obtained in hole SP16-004, which intersected a 41.2 metre interval of 0.42g/t Au (including a 9.1 metre interval of 0.75g/t Au). Offset drilling from this hole returned a 53.3 metre interval averaging 0.24g/t Au from drill hole SP17-011 and a 39-metre interval averaging 0.17g/t Au from drill hole SP17-010.

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Southern Silver Exploration Corp. (An Exploration Stage Company) Management’s Discussion and Analysis For the Year Ended April 30, 2021

D. Summary of Mineral Properties, continued

Oro - New Mexico, USA, continued

Drilling at Stockpond continues to identify intervals of anomalous gold on the order of tens of metres thick which are open the along the projection of the target structure to the south of the original Stockpond target and into an area of strong EM response.

The Company previously completed a 300 line-kilometre airborne Z-TEM survey over the entire property at 200 metre line spacing as part of a larger evaluation of the property to identify new targets for drill testing Cu-Mo porphyry potential. Recent data compilations show several potential high-quality Cu-Au porphyry and skarn targets. Permitting is in progress and the Company is in the final stages of securing bonding for the exploration work. Drilling is anticipated to start mid-Q4 2021.

Acquisition Costs

Mineral property acquisition costs as at April 30, 2021 were:

	Cerro Las	Oro	El Sol	Total
	Minitas
	$	$	$	$
Balance as at April 30, 2019	-	218,447	-	218,447
Additions, net	-	100,238	-	100,238
Balance as at April 30, 2020	-	318,685	-	318,685
Asset acquisition	32,904,741	-	-	32,904,741
Additions, net	32,096	106,767	132,200	271,063
Balance as at April 30, 2021	32,936,837	425,452	132,200	33,494,489

Exploration and Evaluation Expenditures

Exploration and evaluation expenditures for the years ended April 30, 2021 and 2020 were:

	Cerro Las	Minitas	Oro		El Sol		Total
	$	$	$	$	$	$	$	$
	2021	2020	2021	2020	2021	2020	2021	2020
Assays and geochemistry	189,994	-	-	-	2,553	3,826	192,547	3,826
Camp, utilities and supplies	180,415	-	4,535	77	2,068	1,653	187,018	1,730
Claim taxes	68,764	-	-	-	3,702	-	72,466	-
Drilling	2,055,310	-	-	-	-	-	2,055,310	-
Geological and geophysics	166,029	-	14,878	1,090	4,926	16,541	185,833	17,631
Project supervision	381,713	-	10,646	10,890	6,602	8,339	398,961	19,229
IVA	378,067	-	-	-	21,152	-	399,219	-
Other	-	-	1,252	154	-	526	1,252	680
	3,420,292	-	31,311	12,211	41,003	30,885	3,492,606	43,096

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Southern Silver Exploration Corp. (An Exploration Stage Company) Management’s Discussion and Analysis For the Year Ended April 30, 2021

E. Results of Operations

The Company incurred a net loss of $200,133 for the year ended April 30, 2021 (2020 - $2,443,331). A summary of variances is as follows:

	2021	2020	Variance
	$	$	$
Administration	60,000	60,000	-
Consulting	287,264	229,603	57,661
Exploration and evaluation	3,492,606	43,096	3,449,510
Investor relations	644,167	534,467	109,700
Office and general	38,725	23,009	15,716
Professional fees	268,590	206,974	61,616
Regulatory fees and taxes	81,181	41,051	40,130
Share-based payments	3,963,250	903,791	3,059,459
Shareholders' communications	13,568	8,701	4,867
Transfer agent	35,316	15,745	19,571
Travel	-	18,347	(18,347)
Foreign exchange (gain) loss	(355,150)	10,634	(365,784)
Other income	(18,306)	(31,013)	12,707
Loss on settlement of debt	300,420	-	300,420
Share of loss in equity accounted investment	170,579	378,926	(208,347)
Gain on revaluation of investment in associate	(8,782,077)	-	(8,782,077)

As per its mandate to acquire, explore, and develop mineral resource properties, the Company continued drilling at Cerro Las Minitas and completed initial sampling at El Sol (D - Summary of Mineral Properties) . Up until September 15, 2020, the Company’s share of costs associated with exploration and other ancillary activities at Cerro Las Minitas were accounted for within Share of Loss in Equity Accounted Investment. An overall increase in overhead was attributed to on-going promotional initiatives and additional costs relative to financings undertaken.

Non-cash share-based payments expense fluctuates as stock options are granted and vest. Foreign exchange gains and losses fluctuate based on the US and Canadian dollar exchange rate and the extent of transactions and balances denominated in US dollars. Other income recognized mainly relates to interest income earned on cash reserves. A non-cash loss on settlement of debt and noncash gain on revaluation of investment in associate were realized as a result of the transaction with Electrum whereby the Company acquired an additional 60% indirect interest in the Cerro Las Minitas property.

F. Summary of Quarterly Results

The Company earned no revenue due to the nature of current operations.

Quarterly fluctuations mainly relate to recognition of share-based payments which occur as stock options are granted and vest, foreign exchange gains and losses which vary with market rates, mineral property exploration expenses which occur as projects are identified or impairments which occur when indicators arise and share of losses in equity accounted investment.

9

Southern Silver Exploration Corp. (An Exploration Stage Company) Management’s Discussion and Analysis For the Year Ended April 30, 2021

F. Summary of Quarterly Results, continued

Significant share-based payments expense was recognized in the three months ended October 31, 2020, April 30, 2020 and October 31, 2019. A significant gain on disposal of investment in associate was recognized in the three months ended October 31, 2020. The following financial data was derived from the Company’s consolidated financial statements for the eight previous quarters:

		Apr	30,		Jan 31,		Oct 31,		July	31,		Apr	30,		Jan 31,		Oct 31,		Jul 31,
		2021			2021		2020		2020			2020			2020		2019		2019
		$			$		$		$			$			$		$		$
Net (income) loss		1,255,425			1,093,749	(3,037,273)			487,966			586,487			370,922		1,145,796		340,126
Basic (earnings ) loss per share	$		0.01	$	-	$	(0.02)	$		-	$		-	$	-	$	0.01	$	-
Diluted (earnings) loss per share	$		-	$	-	$	(0.01)	$		-	$		-	$	-	$	-	$	-

G. Fourth Quarter

During the fourth quarter, the Company received $2,736,885 in option and warrant exercises and paid US$2,000,000 to Electrum under the acquisition agreement.

H. Summary of Annual Information

During the previous three fiscal years presented below, the Company earned no revenue and main operating costs have remained materially constant, subject to additional contracts for services entered into as required and costs incurred for financing or other ad-hoc projects as undertaken. The Company continues to invest in its mineral properties as resources have permitted and impairment charges are recognized as relevant indicators arise.

To date, the Company has not paid dividends and does not have any long-term financial liabilities.

	2021 2020 2019 $ $ $
Net loss - equity holders Basic and diluted loss per share - equity holders	(200,133) (2,443,331) (2,498,560) (0.00) (0.02) (0.03)
Current assets Other non-current assets Mineral properties Total assets	7,825,461 3,763,806 475,882 - 4,571,121 4,315,120 33,494,489 318,685 218,447
	41,319,950 8,653,612 5,009,449
Total non-current financial liabilities Cash dividends per common share	- - - - - -

10

Southern Silver Exploration Corp. (An Exploration Stage Company) Management’s Discussion and Analysis For the Year Ended April 30, 2021

I. Related Party Transactions

Except as disclosed elsewhere, the Company entered into the following related party transactions:

• (a) Pursuant to a service agreement between the Company and a private company controlled by a director and officer of the Company, the Company was charged as:

• $60,000 (2020 - $60,000) for office space and general administration services;

• $36,300 (2020 - $36,300) for professional services;

• $47,784 (2020 - $22,803) for consulting services;

• $149,005 (2020 - $177,520) for investor relations services;

• $81,180 (2020 - $8,460) for geological services;

• $27,485 (2020 - $86,656) for geological and professional services (charged to associate);

• $nil (2020 - $84,130) for corporate finance services; and

• $3,497 (2020 - $3,303) for the mark-up on out-of-pocket expenses.

Amounts payable as at April 30, 2021 were $29,732 (2020 - $31,077).

• (b) Fees in the amount of $156,000 (2020 - $156,000) were charged by a company controlled by a director and officer of the Company. Amounts payable as at April 30, 2021 were $13,650 (2020 - $13,650).

• (c) Fees in the amount of $118,479 (2020 - $73,000) were charged by a law firm controlled by a director and officer of the Company and included in professional fees, share issue costs, mineral property expenditures / acquisitions or charged to associate. Amounts payable as at April 30, 2021 were $12,118 (2020 - $9,856).

• (d) Fees in the amount of $30,000 (2020 - $30,000) were charged by an officer of the Company for consulting services. Amounts payable as at April 30, 2021 were $2,625 (2020 - $2,625).

• (e) Fees in the amount of $36,000 (2020 - $36,000) were charged by an officer of the Company for consulting services and included in consulting fees, mineral property expenditures or charged to associate. Amounts payable as at April 30, 2021 were $3,150 (2020 - $3,150).

• (f) Fees in the amount of $nil (2020 - $3,000) were charged by a director of the Company for consulting services (charged to associate).

These transactions were in the normal course of operations and were measured at the fair value of the services rendered. Amounts due to related parties are unsecured, non-interest-bearing, and have no formal terms of repayment. The key management personnel of the Company are the directors and officers of the Company. The Company has no long-term employee or post‐employment benefits. Compensation awarded to key management, included in (b), (d), (e) and (f) above, was:

		2021		2020
Short-term benefits	$	222,000	$	225,000
Share-based payments		2,563,396		580,047
Total	$	2,785,396	$	805,047

11

Southern Silver Exploration Corp. (An Exploration Stage Company) Management’s Discussion and Analysis For the Year Ended April 30, 2021

I. Related Party Transactions, continued

One executive officer is entitled to termination benefits in the event of a change of control equal to thirty-six months compensation. Upon a change of control, and assuming the triggering event took place on the last business day of the period end, the payment would be $468,000.

J. Financial Condition, Liquidity and Capital Resources

As at April 30, 2021, the Company had working capital of $2,329,697 (2020 - $3,426,810).

The Company does not yet generate any revenue from operations and, for the foreseeable future, will need to rely upon earn-in agreements and / or issue share capital to finance future exploration and administrative activities. Although the Company has been successful in its financing initiatives, there can be no assurance that the Company will be able to obtain adequate future financing. Failure to obtain such additional financing could result in delay or indefinite postponement of further exploration and development of its projects with a possible loss of some properties and reduction or termination of operations.

On September 15, 2020, the Company closed a transaction to acquire Electrum’s 60% interest in SSHL thereby acquiring control of SSHL. As consideration for the acquisition, the Company must pay Electrum an aggregate US$15,000,000 in a combination of cash and common shares, of which US$4,000,000 remains payable on or before September 15, 2021 (US$2,000,000 in cash and US$2,000,000 in shares based on the greater of the prior 20-day VWAP and the DMP of the shares). The Company has the option to pay all cash in lieu of shares and, to secure the remaining payment, the Company has agreed to pledge to Electrum the shares representing Electrum’s 60% interest in SSHL.

During the fiscal year, the Company closed brokered and non-brokered private placements for gross proceeds of $14,456,000 and received $6,275,960 from stock option and share purchase warrant exercises. Subsequent to the year-end, the Company closed additional brokered and non-brokered private placements for gross proceeds of $12,000,000 and received $2,446,700 from stock option and share purchase warrant exercises.

Net proceeds from the above will be used for: exploration at CLM, including a mineral resource update on the project scheduled for Q4 2021; payment of the remaining balance due to Electrum; new green fields drilling at El Sol; exploration at Oro which is scheduled to commence in Q4 2021 and general working capital purposes.

K. Outstanding Equity and Convertible Securities

i) Issued and Outstanding Shares

As at August 30, 2021, the Company had 282,939,254 common shares issued and outstanding.

ii) Share Purchase Warrants

Share purchase warrants outstanding as at August 30, 2021 were:

12

Southern Silver Exploration Corp. (An Exploration Stage Company) Management’s Discussion and Analysis For the Year Ended April 30, 2021

K. Outstanding Equity and Convertible Securities, continued

ii) Share Purchase Warrants, continued

Exercise		Expiry	Balance			Balance
Price		Date	April 30, 2021	Issued	Exercised	August 30, 2021
$0.15		May 19, 2021	2,900,000	-	2,900,000	-
$0.55		June 13, 2022	6,372,500	-	-	6,372,500
$0.55		August 31, 2022	1,170,000	-	-	1,170,000
$0.55		September 29, 2022	1,254,500	-	-	1,254,500
$0.25		August 13, 2024	10,260,262	-	735,000	9,525,262
$0.25		September 4, 2024	4,527,600	-	30,000	4,497,600
$0.25	*	August 14, 2023	22,582,500	-	5,652,000	16,930,500
$0.28	*	August 14, 2023	9,446,477	-	187,500	9,258,977
$0.50		September 11, 2023	1,200,000	-	-	1,200,000
$0.75		June 16, 2023	-	9,000,000	-	9,000,000
$0.50		June 16, 2023	-	360,000	-	360,000
$0.50		June 16, 2023	-	120,000	-	120,000
$0.75		June 21, 2023	-	3,000,000	-	3,000,000
$0.75		June 21, 2023	-	303,500	-	303,500
			59,713,839	12,783,500	9,504,500	62,992,839
Weighted average exercise price			$0.30	$0.74	$0.22	$0.40
Weighted average remaining life in years			2.27			2.00

* Exercise price is $0.25 during the first year, increasing to $0.30 in year two and $0.35 in year three.

** Exercise price is $0.28 during the first year, increasing to $0.33 in year two and $0.38 in year three.

iii) Stock Options

Stock options outstanding and exercisable as at August 30, 2021 were:

Exercise	Expiry	Balance			Balance
Price	Date	April 30, 2021	Granted	Exercised	August 30, 2021
$0.30	June 3, 2021	1,125,000	-	1,125,000	-
$0.34	October 2, 2022	2,450,000	-	-	2,450,000
$0.34	February 1, 2023	150,000	-	-	150,000
$0.17	September 27, 2023	590,000	-	70,000	520,000
$0.27	October 1, 2024	2,950,000	-	-	2,950,000
$0.20	December 20, 2024	100,000	-	-	100,000
$0.12	April 3, 2025	1,595,000	-	95,000	1,500,000
$0.12	April 3, 2023	-	-	-	-
$0.51	September 24, 2025	9,500,000	-	-	9,500,000
$0.58	October 19, 2025	100,000	-	-	100,000
$0.50	February 11, 2026	200,000	-	-	200,000
$0.40	August 13, 2026	-	200,000	-	200,000
		18,760,000	200,000	1,290,000	17,670,000
Weighted	average exercise price - outstanding	$0.39	$0.40	$0.28	$0.40
Weighted	average remaining life in years - outstanding	3.48			3.38
Weighted	average exercise price - exercisable	$0.39	$0.40	$0.28	$0.40
Weighted	average remaininglife inyears - exercisable	3.48			3.38

13

Southern Silver Exploration Corp. (An Exploration Stage Company) Management’s Discussion and Analysis For the Year Ended April 30, 2021

K. Outstanding Equity and Convertible Securities, continued

iv) Compensation Options

Compensation options outstanding as at August 30, 2021 were as follows:

Exercise	Expiry	Balance			Balance
Price	Date	April 30, 2021	Issued	Exercised	August 30, 2021
$0.20	August 14, 2023	2,166,293	-	33,250	2,133,043
$0.50	June 16, 2023	-	1,260,000	-	1,260,000
		2,166,293	1,260,000	33,250	3,393,043
Weighted average exercise price		$0.20	$0.50	$0.20	$0.31
Weighted average remaining life in years		2.29			1.23

L. Financial Instruments

The Company’s financial instruments include cash, other receivables, accounts payable and accrued liabilities, amounts due to related parties and asset acquisition payable. The Company has classified its financial instruments into the following categories:

Financial Instrument	Category	CarryingValue
Cash	FVTPL	Fair Value
Other Receivables	Loans and Receivables	Amortized Cost
Accounts Payable and Accrued Liabilities	Other Financial Liabilities	Amortized Cost
Due to Related Parties	Other Financial Liabilities	Amortized Cost
Asset Acquisition	Other Financial Liabilities	Amortized Cost

The carrying values of all the above financial instruments approximate their fair values due to the short period to maturity. The main risk these financial instruments are exposed to is foreign currency risk with to respect to assets and liabilities denominated in US dollars and Mexican Pesos. Based on forecast exchange rates, the Company does not believe these risks to be material. The Company’s risk management policies require significant cash deposits or any short-term investments be invested with Canadian chartered banks rated BBB or better, or commercial paper issuers R1/A2/P2 or higher. All investments must be less than one year in duration.

M. Events After the Reporting Period and Outlook

There are no other material events subsequent to the end of the reporting period. The Company plans to continue to explore its properties and activities over the ensuing year will focus on this. The Company expects to continue its strategy of collaborating with experienced mining companies to acquire and develop other properties and to advance them to production.

N. Off-Balance Sheet Arrangements

The Company does not have any off-balance sheet arrangements and does not contemplate entering into any such arrangements in the foreseeable future.

14

Southern Silver Exploration Corp. (An Exploration Stage Company) Management’s Discussion and Analysis For the Year Ended April 30, 2021

O. Disclosure Controls and Procedures

The Board of Directors, through its Audit Committee, is responsible for ensuring that management fulfills its responsibilities for financial reporting and internal control. The Audit Committee is composed of three directors, two of whom are independent, who meet at least quarterly with management, and at least annually with the external auditors, to review accounting, internal control, financial reporting and audit matters.

There have been no significant changes to the Company’s internal control over financial reporting that occurred during the period that have materially affected, or are reasonably likely to materially affect the Company’s internal control over financial reporting.

The Audit Committee has established procedures for complaints received regarding accounting, internal controls or auditing matters, and for a confidential, anonymous submission procedure for employees who have concerns regarding questionable accounting or auditing matters.

The Whistleblower policy is in accordance with National Instrument 52‐110 Audit Committees, National Policy 58‐201 Corporate Governance Guidelines and National Instrument 58‐101 Disclosure of Corporate Governance Practices.

Being a venture issuer, the Company is exempted from the certification on Disclosure Controls and Procedures and Internal Control Over Financial Reporting. The Company is required to file Form 52‐ 109FV1 for annual reporting and Form 52‐109FV2 for interim reporting.

P. Risks and Uncertainties

The principal business of the Company is the acquisition, exploration and development of mineral properties. Given the nature of the mining business, the limited extent of the Company’s assets and the present stage of development, the following risk factors, among others, should be considered:

Exploration Stage Company

The Company does not hold any known mineral reserves of any kind and does not generate any revenues from production. The Company’s success will depend largely upon its ability to locate commercially productive mineral reserves.

Mineral exploration is highly speculative in nature, involves many risks and frequently is nonproductive. There is no assurance that exploration efforts will be successful. Success in establishing reserves is a result of a number of factors, including the quality of management, the level of geological and technical expertise, and the quality of property available for exploration.

Once mineralization is discovered, it may take several years in the initial phases of drilling until production is possible, during which time the economic feasibility of production may change. Substantial expenditures are required to establish proven and probable reserves through drilling and bulk sampling, to determine the optimal metallurgical process to extract the metals from the ore and, in the case of new properties, to construct mining and processing facilities.

Because of these uncertainties, no assurance can be given that our exploration programs will result in the establishment or expansion of resources or reserves.

15

Southern Silver Exploration Corp. (An Exploration Stage Company) Management’s Discussion and Analysis For the Year Ended April 30, 2021

P. Risks and Uncertainties, continued

No Operating History and Availability of Financial Resources

The Company does not have an operating history and has no operating revenues and is unlikely to generate any significant amount in the foreseeable future. Therefore, it may not have sufficient financial resources to undertake, by itself, all of its planned exploration and administrative activities.

Historically, the Company has relied mainly upon the issuance of share capital to finance its activities. In the future, the Company will be required to rely on earn-in agreements and / or issue share capital to finance future exploration and administrative activities, which may result in dilution to existing shareholders. Furthermore, the amount of additional funds required may not be available under favorable terms, if at all.

Failure to obtain additional funding on a timely basis could result in delay or indefinite postponement of further exploration and development and could cause the Company to forfeit its interests in some or all of its properties or to reduce or discontinue its operations.

Dependence on Key Personnel

The Company is dependent on a relatively small number of key directors, officers and senior personnel. Loss of any one of those persons could have an adverse effect on the Company. The Company does not currently maintain “key‐man” insurance in respect of any of its management.

Price Volatility and Lack of Active Market

Securities markets in Canada and elsewhere continue to experience a high level of price and volume volatility, and the market prices of securities of many public companies have experienced significant fluctuations in price which have not necessarily been related to the operating performance, underlying asset values or prospects of such companies. It may be anticipated that any quoted market for the Company’s securities will be subject to such market trends and that the value of such securities may be affected accordingly. If an active market does not develop, the liquidity of the investment may be limited and the market price of such securities may decline below the subscription price.

Government Regulations and Environmental Risks and Hazards

The Company conduct is subject to various federal, provincial, state laws, rules and regulations, including environmental legislation. Environmental legislation is becoming increasingly stringent and costs and expenses of regulatory compliance are increasing. The impact of new and future environmental legislation on the Company’s operations may cause additional expenses and restrictions. If the restrictions adversely affect the scope of exploration and development on the resource property interests, the potential for production on the property may be diminished or negated.

The Company has adopted environmental practices designed to ensure that it continues to comply with environmental regulations currently applicable to it. All of the Company’s activities are in compliance in all material respects with applicable environmental legislation.

16

Southern Silver Exploration Corp. (An Exploration Stage Company) Management’s Discussion and Analysis For the Year Ended April 30, 2021

P. Risks and Uncertainties, continued

Environmental hazards may exist on the Company’s properties, which may have been caused by previous or existing owners or operators of the properties. The Company is not aware of any existing environmental hazards related to any of its current property interests that may result in material liability to the Company.

Competition

The resource industry is intensively competitive in all of its phases, and the Company competes with many other companies possessing much greater financial and technical resources. Competition is particularly intense with respect to the acquisition of desirable undeveloped properties. The principal competitive factors in the acquisition of prospective properties include the staff and data necessary to identify and investigate such properties, and the financial resources necessary to acquire and develop the projects. Competition could adversely affect the Company’s ability to acquire suitable prospects for exploration.

Title to Property

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, aboriginal land claims or government expropriation and title may be affected by undetected defects.

Licenses and Permits

The operations of the Company require licenses and permits from various government authorities. The Company believes that it holds all necessary licenses and permits under applicable laws and regulations for work in progress and believes it is presently complying in all material respects with the terms of such licenses and permits. However, such licenses and permits are subject to change in various circumstances. There can be no guarantee that the Company will be able to obtain or maintain all necessary licenses and permits that may be required to explore and develop its properties, commence construction or operation of mining facilities or to maintain continued operations that economically justify the cost.

COVID-19

In 2020, the COVID-19 global health pandemic resulted in significant volatility and turmoil in world markets. While the negative economic impact of measures to contain the virus have been mitigated to an extent by fiscal and monetary stimulus, by measures taken to reopen world economies, and by the development and roll out of vaccines, the situation remains uncertain and its impact on the Company depends to a large extent on future developments and new information that may emerge regarding COVID-19, its variants and the pandemic, factors which are beyond the Company’s control. Given the extent of the crisis, it is difficult to estimate the duration of the situation or its ultimate impact on the Company.

17

Southern Silver Exploration Corp. (An Exploration Stage Company) Management’s Discussion and Analysis For the Year Ended April 30, 2021

Q. Proposed Transactions

Other than normal course review of monthly submittals, there are no other new acquisitions or proposed transactions contemplated as at the date of this report.

R. Forward-Looking Statements

Some of the statements contained in this MD&A may be deemed “forward-looking statements.”

These include estimates and statements that describe the Company’s future plans, objectives or goals, and expectations of a stated condition or occurrence. Forward-looking statements may be identified by the use of words such as “believes”, “anticipates”, “expects”, “estimates”, “may”, “could”, “would”, “will”, or “plan”. Since forward-looking statements are based on assumptions and address future events and conditions, by their very nature they involve inherent risks and uncertainties.

Actual results relating to, among other things, results of exploration, reclamation, capital costs, and the Company’s financial condition and prospects, could differ materially from those currently anticipated in such statements for many reasons such as but not limited to; changes in general economic conditions and conditions in the financial markets; changes in demand and prices for the minerals the Company expects to produce; litigation, legislative, environmental and other judicial, regulatory, political and competitive developments; technological and operational difficulties encountered in connection with the Company’s activities; changing foreign exchange rates and other matters discussed in this MD&A.

Readers should not place undue reliance on the Company’s forward-looking statements. Further information regarding these and other factors, which may cause results to differ materially from those projected in forward-looking statements, are included in the filings by the Company with securities regulatory authorities. The Company does not assume any obligation to update or revise any forward-looking statement that may be made from time to time by the Company or on its behalf, except in accordance with applicable securities laws, whether as a result of new information, future events or otherwise.

18