Strategic Resources Inc. — Management Reports 2024

May 27, 2024

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STRATEGIC RESOURCES INC.

MANAGEMENT DISCUSSION AND ANALYSIS

FOR THE THREE-MONTH AND NINE-MONTH PERIODS ENDED MARCH 31, 2024

TSX-V: SR

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www.strategic-res.com

Strategic Resources Inc. Management discussion and analysis

For the three-month and nine-month periods ended March 31, 2024 (Expressed in thousands of Canadian dollars or other currencies, unless otherwise stated)

The following management discussion and analysis (“MD&A”) of Strategic Resources Inc. (“Strategic” or the “Company”) for the three-month and nine-month periods ended March 31, 2024 should be read in conjunction with the unaudited condensed interim consolidated financial statements (“interim financial statements”) for the three-month and nine-month periods ended March 31, 2024, together with the notes thereto. The unaudited condensed interim consolidated financial statements have been prepared in Canadian dollars, which is the Company’s presentation and functional currency, in accordance with International Accounting Standards 34, Interim Financial Reporting (“IAS 34”), and International Financial Reporting Standards (‘’IFRS’’) as issued by the International Accounting Standards Board (“IASB”). The Company’s significant accounting policies are set out in note 2 of the consolidated financial statements for the year ended June 30, 2023 and, where required, in note 3 of the unaudited condensed interim consolidated financial statements for the three-month and nine-month periods ended March 31, 2024.

This MD&A contains forward looking statements that are based on certain estimates and assumptions and involve risks and uncertainties. Actual results may vary materially from management’s expectations. See the “Forward Looking Statements” section later in this MD&A for further information. All figures in this MD&A are expressed in thousands of Canadian dollars or other currencies, unless otherwise stated.

The Board of Directors approved this MD&A on May 27, 2024.

Reverse takeover transaction, private placement and TSXV listing

On December 13, 2022, BlackRock Metals Inc. (“BlackRock”) entered into an arm's length share exchange agreement (the "Share Exchange Agreement") with Strategic pursuant to which Strategic acquired all of the outstanding shares in BlackRock for shares of Strategic (the " Transaction"). The Transaction constituted a reverse takeover of Strategic. Upon completion of the Transaction, BlackRock became a wholly-owned subsidiary of Strategic. However, after the Transaction, the shareholders of BlackRock held a majority of the common shares of Strategic. Strategic continued to trade on the TSX Venture Exchange (the "TSXV") under the name "Strategic Resources Inc.".

In connection with the Transaction:

• All of the long-term debt with shareholders in BlackRock was converted into 1,089,259 post-consolidation Strategic common shares.

• All of BlackRock’s issued and outstanding common shares were exchanged for 46,666,667 postconsolidated Strategic common shares. The Restricted Share Units (“RSU”) issued by BlackRock were exchanged for replacement Strategic RSU.

• Strategic raised $14,009 through a private placement of $13,500 of subscription receipts ("Receipts") and $509 of convertible debentures (collectively the "Offering"). The Receipts were issued at a preconsolidation price of $0.50 per Receipt. Each Receipt entitled the holder to receive, without payment of additional consideration or further action, upon closing of the Transaction, one common share of Strategic (a "Strategic Share"). Upon closing of the Transaction, the convertible debentures automatically converted to common shares of Strategic at a pre-consolidation price of $0.50 per share.

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Strategic Resources Inc. Management discussion and analysis

For the three-month and nine-month periods ended March 31, 2024 (Expressed in thousands of Canadian dollars or other currencies, unless otherwise stated)

• Immediately prior to the completion of the Transaction, Strategic consolidated its common shares on the basis of 1 post-consolidation Strategic common share for every 6 Strategic common shares existing before such consolidation.

• On March 31, 2023, Strategic completed the Transaction with BlackRock.

• On April 12, 2023, Strategic’s common shares (post Transaction) resumed trading on the TSX Venture Exchange under the symbol “SR.V”.

For accounting purposes, it has been determined that Strategic was the accounting acquiree and BlackRock was the accounting acquirer as the shareholders of BlackRock now control Strategic, based upon the guidance in IFRS 10, Consolidated Financial Statements, and IFRS 3, Business Combinations, to identify the accounting acquirer. Since BlackRock is considered the accounting acquirer, the consolidated financial statements are prepared as a continuation of the financial statements of BlackRock, as a result, 2023 comparative information included herein is solely that of BlackRock. From March 31, 2023, the consolidated financial statements include the results of operations of both Strategic and BlackRock (the “Group”).

Description of business and overview

The Company is developing a metals and materials manufacturing business from its wholly-owned vanadium and titanium bearing magnetite ("VTM") deposit in Québec, Canada (the “Project”). The mine and concentrator portion of the Project is located approximately 700 km north of Montréal, and 20 km southeast (60 km by road) of Chibougamau, Québec on traditional Cree lands within the James Bay Territory.

The Company’s metallurgical facility will be located at Port Saguenay, a Federal deep-sea port and industrial park with access to the St. Lawrence Seaway. Port Saguenay is 380km south of Chibougamau and is connected by existing railway. Both the mine site and metallurgical facility are permitted to commence construction.

The Company intends to produce a number of critical minerals including Vanadium, Titanium and High Purity Pig Iron in an integrated operation. The Project will be the first VTM mine in North America and is planned to be one of the lowest carbon emitting metallurgical facilities in the world. The plant is designed to be green hydrogen ready and the Company’s plans call for these critical and strategic minerals to be transformed into green products used by industry to produce high quality metal alloys and advanced batteries, reducing the global greenhouse gas emissions of producing such products.

During the last quarter of 2023, after initial discussions and feedback from iron ore traders and potential strategic partners, the Company decided to prioritize the construction of a four million tonne per annum (“mtpa”) iron ore pellet plant at Port Saguenay.

As a result, the Companys utility needs have been substantially reduced for both natural gas and electricity and the Company has decided to release BlackRocks old electrical contract with Hydro-Québec and forgo the associated letters of credit (see under “Commitments and Obligations” below). Through this process, the Company intends to recover surplus capital into its treasury which can be used to advance the Project.

The Company also holds a VTM project in Finland as follows:

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Strategic Resources Inc. Management discussion and analysis

For the three-month and nine-month periods ended March 31, 2024 (Expressed in thousands of Canadian dollars or other currencies, unless otherwise stated)

Mustavaara Project

Mustavaara is a large VTM deposit, which was mined by the Finnish state company Rautaruukki Oy between 1976 and 1985. Mustavaara is located in the Municipality of Taivalkoski, 75 kilometres southwest of the city of Kuusamo. The three mineral claim reservations held comprise an area of approximately 2,650 hectares. The vanadium produced from Mustavaara and the nearby Otanmäki deposit accounted for approximately 10% of the world’s vanadium production at that time. Mining was suspended due to adverse market conditions and the processing facilities were dismantled in 2001. Ferrovan commissioned Pöyry Finland Oy to complete a PreFeasibility Study (“PFS”) for the project in 2011. The resulting 2012 PFS outlined a project that would have a concentrator near site and a smelting plant located close to the coast in the city of Raahe.

During the first half of 2021, the Company worked with AFRY Finland Oy to complete a Preliminary Economic Assessment (“PEA”) on Mustavaara, the results of which were announced on May 4, 2021 in a news release titled “Strategic Resources Announces Mustavaara PEA; €190M After-tax NPV (8%) with a 20 Year Mine Life.” A NI 43101 technical report, titled “NI 43-101 Technical Report Preliminary Economic Assessment on the Mustavaara Vanadium project, Finland” detailing the PEA for the Mustavaara Project was completed and filed on SEDAR+ and Strategic’s website on June 10, 2021, with an effective date of May 4, 2021.

In November 2021, the Company filed exploration permit applications with the Finnish mining authority (Tukes) to transition all the concessions at Mustavaara from reservation status to the exploration license phase. Exploration permits (formerly reservations) were granted to Strategic Explorations Oy by the Finnish Safety and Chemicals Agency (the “ Mining Authority ”) on 26 April 2023. A registered association named Kansalaisten kaivosvaltuuskunta – MiningWatch Finland ry appealed against all of the said exploration permit decisions. The appeals are currently pending at the Administrative Court of Northern Finland. The decision of the Administrative Court is expected to be given in the second half of 2024.

An application to extend the existing water permit allowing for future construction of mining operations at Mustavaara was delivered to Regional State Administrative Agency for Northern Finland (“PSAVI”) in February 2022. On June 21, 2022, PSAVI approved the application to extend the permit for three years to July 2025. The approval was open for public appeals to the Regional Court until July 28, 2022. No appeals were made, and the permit is now legally binding.

A proposal for an environmental baseline monitoring program was sent to the Centre for Economic Development, Transport and the Environment of North Ostrobothnia in November 2021. The monitoring program was open for public comments between May 11, 2022 to June 17, 2022, with no significant matters raised during that period. The monitoring program was approved in October 2022 following which the Company has been in consultation with third-party contractors to define a future program.

In February 2024, the European Union selected the Mustavaara Project to be part of AVANTIS, a €5 million study on vanadium and titanium. The study which is funded by the European Union will evaluate new extraction methods to produce two distinct pre-concentrates: (1) ilmenite-rich, titanium-pre-concentrate and (2) ilmenitefree, vanadium-pre-concentrate.

The Company is continuing to focus on advancing the local permits and environmental studies which will be required for future permits and operations on the project, as described above.

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Strategic Resources Inc. Management discussion and analysis

For the three-month and nine-month periods ended March 31, 2024 (Expressed in thousands of Canadian dollars or other currencies, unless otherwise stated)

Additional Information

Additional information about the Company is available under the Company’s profile on SEDAR+ at www.sedarplus.ca and on the Company’s website at www.strategic-res.com.

Adrian Karolko, P.Geo., is a qualified person as defined by National Instrument 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101”) and has reviewed and approved for inclusion the scientific and technical disclosure in this MD&A.

Outlook

During the last quarter of 2023 the Company completed initial rounds of discussions with iron ore traders and potential strategic partners regarding its plans for a standalone 4 mtpa iron ore pellet plant at Port Saguenay. Based on the initial feedback on the pellet project, the Company has decided to prioritize the construction of a 4 mtpa iron ore pellet plant at Port Saguenay in Québec. The Company completed a Pre-feasibility Class 5 level engineering study on the pellet plant and is working on funding and securing iron ore concentrate feed for the project. The Company will continue to work to advance economic studies and permitting work on its Mustavaara project in Finland, as well as to evaluate opportunities that may arise for future acquisitions.

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Strategic Resources Inc. Management discussion and analysis

For the three-month and nine-month periods ended March 31, 2024

(Expressed in thousands of Canadian dollars or other currencies, unless otherwise stated)

Financial highlights

Expenses General and administrative Salaries, benefits and directors’ fees Professional fees Restructuring fees Depreciation, amortization and share-based compensation Other income (expenses) Finance income Finance expenses Foreign exchange gain (loss) Change in fair value of restricted share unit liability Stakeholder support Reverse acquisition of Strategic Loss on disposal of property, plant and equipment Taxes Income and mining tax expense Net loss Other comprehensive loss Comprehensive loss for the period Basic and diluted (loss) income per share Total assets Non-current liabilities Total liabilities Equity	For the three-month periods ended March 31 For the nine-month periods ended March 31	For the three-month periods ended March 31 For the nine-month periods ended March 31	For the three-month periods ended March 31 For the nine-month periods ended March 31
	2024 2023 2024		2023
	(344) (206) (785) (228) (223) (869) (354) (356) (1,134) - - (2) (709) (973) (2,988) 234 150 796 (327) (393) (990) - 1 - 114 (204) 982 - - - - (20,627) - - (1) - - (20) -		(669) (563) (839) (45) (2,919) 317 (1,076) (1) (798) (4,603) (20,627) (2) (20)
	(1,614) (22,852) (4,990) (1) - 2		(31,845) -
	(1,615) (22,852) (4,988)		(31,845)
	(0.03) (0.50) (0.08)		(0.71)
		March 31, 2024	June 30, 2023
		178,409 24,264 38,010 140,399	179,916 23,948 36,918 142,998

Results for the three months ended March 31, 2024 and 2023

General and administrative

For the three months ended March 31, 2024, general and administrative expenses increased by $138 to $344 from the comparative quarter due mainly to higher directors and officers’ liability insurance costs as the Company became a publicly listed entity, more travelling for corporate development and additional costs of being a listed company. General and administrative expenses comprised insurance, rents, telecommunication, information technology costs, travel, investor relations and communications and other administrative expenses.

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Strategic Resources Inc. Management discussion and analysis

For the three-month and nine-month periods ended March 31, 2024 (Expressed in thousands of Canadian dollars or other currencies, unless otherwise stated)

Salaries, benefits and directors’ fees

For the three months ended March 31, 2024, salaries, benefits and directors’ fees increased slightly from the comparative quarter due to additional employee costs after completion of the Transaction.

Professional fees

For the three months ended March 31, 2024, professional fees of $354 were in line with the comparative quarter. Increases due to additional consulting fees to management during the period were offset by decreases in costs incurred to close the Transaction in the previous quarter.

Depreciation, amortization and share-based compensation

For the three months ended March 31, 2024, share-based compensation decreased by $264 from the comparative quarter. The previous quarter included restricted share units (“RSU”) issued to management in July 2022 and the current quarter includes stock options granted to directors, officers, employees and consultants in August 2023 as well as remaining fair value of the RSU being expensed over its vesting period. Depreciation and amortization was negligible in both periods.

Finance income

For the three months ended March 31, 2024, finance income increased by $84 versus the comparative quarter as a result of higher interest rates earned on investments and cash balances from the private placement completed with the Transaction.

Finance expenses

For the three months ended March 31, 2024, finance expenses decreased by $66 versus the comparative quarter because previously finance expenses included interest on long-term debt with shareholders which was settled on March 31, 2023. Finance expenses now include interest on the lease obligation, financial costs of maintaining the letters of credits and accretion interest on the asset retirement obligations.

Change in fair value of restricted share unit liability

For the three months ended March 31, 2024, the earned portion of the RSU issued to management has been revalued to fair value, resulting in a gain of $114 compared to a loss of $204 for the comparative quarter due to a decrease in share price of the Company.

Reverse acquisition of Strategic

For the three-month period ended March 31, 2023, the expense of $20,627 represented the excess of consideration transferred by BlackRock to acquire the net assets of $2,597 of Strategic during the reverse acquisition.

Income and mining taxes expense

For the three-month period ended March 31, 2023, income and mining tax expense of $20 was recorded, representing a reduction in mining tax credit refund received. There was no income and mining taxes expense for the three-month period ended March 31, 2024.

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Strategic Resources Inc. Management discussion and analysis

For the three-month and nine-month periods ended March 31, 2024 (Expressed in thousands of Canadian dollars or other currencies, unless otherwise stated)

Development project expenditures

For the three months ended March 31, 2024, the Company incurred development expenditures of $179, including $92 of capitalized amortization, with respect to the development of the proposed metallurgical plant at the Port Saguenay. The total cost was capitalized in the condensed interim consolidated statement of financial position as metallurgical plant under construction.

For the three months ended March 31, 2024, the Company incurred development expenditures of $20 with respect to the development of the proposed mine and concentrator plant in Chibougamau. The expenditure was capitalized in the condensed interim consolidated statement of financial position as mine under construction.

Results for the nine months ended March 31, 2024 and 2023

General and administrative

For the nine months ended March 31, 2024, general and administrative expenses increased by $116 to $785 compared to the same period in the previous year. Increases due to costs of directors and officers’ liability insurance as the Company became a publicly listed entity after the Transaction, costs of being a listed company, travelling costs and costs at the Finland subsidiary were offset by decreases in rents. General and administrative expenses comprised insurance, rents, telecommunication, information technology costs, travel, investor relations and communications and other administrative expenses.

Salaries, benefits and directors’ fees

For the nine months ended March 31, 2024, salaries, benefits and directors’ fees increased by $306 from the same period in the previous year due to additional employee costs post the Transaction.

Professional fees

For the nine months ended March 31, 2024, professional fees increased by $295 from the same period in the previous year because of additional public company related costs, additional tax filings as a result of the Transaction, additional consulting fees to management and additional professional fees for the Finland subsidiary.

Restructuring fees

For the nine-month period ended March 31, 2024, restructuring fees from CCAA Proceedings decreased to $2 compared to $45 for the comparative period.

Depreciation, amortization and share-based compensation

For the nine months ended March 31, 2024, share-based compensation of $2,988 included the expensing of the calculated fair values of RSU issued to management as well as stock options granted to directors, officers, employees and consultants over their vesting periods. For the nine months ended March 31, 2023, sharebased compensation of $2,918 included RSU issued to management being expensed over the vesting period of the RSU. Depreciation and amortization was negligible in both periods.

Finance income

For the nine months ended March 31, 2024, finance income increased by $479 compared to the same period in the previous year as a result of higher interest rates earned on investments and cash balances from the private placement completed with the Transaction.

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Strategic Resources Inc. Management discussion and analysis

For the three-month and nine-month periods ended March 31, 2024 (Expressed in thousands of Canadian dollars or other currencies, unless otherwise stated)

Finance expenses

For the nine months ended March 31, 2024, finance expenses of $990 were lower by $86 versus the comparative period because previously finance expenses included interest on long-term debt with shareholders which was settled on March 31, 2023. Finance expenses now include interest on the lease obligation, financial costs of maintaining the letters of credits and accretion interest on the asset retirement obligations.

Change in fair value of restricted share unit liability

For the nine months ended March 31, 2024, the earned portion of the RSU issued to management has been revalued to fair value, resulting in a gain of $982 compared to a loss of $798 for the comparative period due to a decrease in share prices of the Company.

Stakeholder support

For the nine months ended March 31, 2023, the expense of $4,603 represented the fair value of common shares issued to a stakeholder for continued participation in the project development, including but not limited to guidance with respect to social acceptability issues and environmental stewardship and for continued support of the development of important project related infrastructure initiatives.

Reverse acquisition of Strategic

For the nine-month period ended March 31, 2023, the expense of $20,627 represented the excess of consideration transferred by BlackRock to acquire the net assets of $2,597 of Strategic during the reverse acquisition.

Income and mining taxes expense

For the nine-month period ended March 31, 2023, income and mining tax expense of $20 was recorded, representing a reduction in mining tax credit refund received. There was no income and mining taxes for the nine-month period ended March 31, 2024.

Development project expenditures

For the nine months ended March 31, 2024, the Company incurred development expenditures of $562, including $272 of capitalized amortization, with respect to the development of the proposed metallurgical plant at the Port Saguenay. The total cost was capitalized in the condensed interim consolidated statement of financial position as metallurgical plant under construction.

For the nine months ended March 31, 2024, the Company incurred development expenditures of $63 with respect to the development of the proposed mine and concentrator plant in Chibougamau. The expenditure was capitalized in the condensed interim consolidated statement of financial position as mine under construction.

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Strategic Resources Inc. Management discussion and analysis

For the three-month and nine-month periods ended March 31, 2024 (Expressed in thousands of Canadian dollars or other currencies, unless otherwise stated)

Cash-flows

Net cash used in operating activities Net cash used in investing activities Net cash (used in) provided by financing activities Net (decrease) increase in cash Effect of foreign exchange rate changes on cash Cash – beginning of the period Cash – end of the period	For the Nine-month ended March 31
	2024 2023 (2,861) (3,886) (1,366) (311) (106) 14,935 (4,333) 10,738 1 - 6,619 2,107 2,287 12,845

Operating activities

For the nine months ended March 31, 2024, cash used in operating activities was $2,861 compared to $3,886 in the comparative period. The decrease in cash usage is mainly due to movement in working capital items during the period.

Investing activities

For the nine months ended March 31, 2024, cash used in investing activities was $1,366 compared to $311 in the comparative period. The Company invested $1,050 of the cash received from the private placement in Guaranteed Investment Certificates to earn interest income. Additions to development project expenditures were $356 in the current period compared to $311 in the previous period. The Company received a refund of environmental deposits of $40 as a result of abandoning the Silasselkä project in Finland.

Financing activities

For the nine-month periods ended March 31, 2024, cash used in financing activities was $106, being repayment under the Port of Saguenay lease. In the comparative period, the Company received $1,500 from shareholders` loan and net proceeds of $13,536 from a private placement on closing the Transaction and paid $101 for the Port of Saguenay lease.

Liquidity and capital resources

As at March 31, 2024, the Company had cash and short-term investments of $3,337 compared to $6,619 at the end of June 2023. The Company had working capital of $1,773 and shareholders’ equity of $140,399 as at March 31, 2024. The Company's business plan is dependent on raising additional funds to finance operations within and beyond the next 12 months. To date, the Company has been able to finance its operations through proceeds from the issuance of long-term debt and equity financing. Refer to note 2 (Going concern) to the interim consolidated financial statements for the period ended March 31, 2024 for additional information concerning the going concern basis of presentation.

Financing activities

There were no financing activities during the nine-month period ended March 31, 2024.

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Strategic Resources Inc. Management discussion and analysis

For the three-month and nine-month periods ended March 31, 2024 (Expressed in thousands of Canadian dollars or other currencies, unless otherwise stated)

Selected quarterly information

The following table sets out selected unaudited interim quarterly financial information of the Company covering the last eight quarters and is derived from the unaudited interim consolidated financial statements of the Company.

Quarter Ended	Revenue	Net income (loss)	Basic and diluted income (loss) per share*
March 31,2024		(1,614)	(0.03)
December 31,2023		(1,216)	(0.02)
September 30,2023		(2,160)	(0.03)
June 30,2023		(2,182)	(0.04)
March 31,2023		(22,852)	(0.50)
December 31,2022		(7,185)	(0.17)
September 30,2022		(1,808)	(0.04)
June 30,2022		43,732	3.22

*Adjusted retroactively for common shares of BlackRock exchanged for post-consolidation common shares of Strategic

On December 23, 2021, BlackRock entered CCAA Proceedings and operated under the supervision of a court appointed monitor until May 31, 2022, when the Court approved BlackRock’s restructuring. The net income for the quarter ended June 30, 2022 is a result of the gain on recapitalization plan activities, cancellation of the warrants and derecognition of the embedded derivative as discussed above.

Commitments and obligations

In the normal course of business, the Company enters into contracts that give rise to commitments and contractual obligations. The following table summarizes the Company’s contractual obligations as at March 31, 2024:

Operating lease payments Services agreement Payables and accrued liabilities Contractual lease obligation Restricted share unit liability Asset retirement obligations	Less than one year One to five years More than fiveyears Total
	6 1 7 13 13 11,610 11,610 1,008 4,236 44,141 49,385 1,530 1,530 1,112 1,112
	14,167 4,237 45,253 63,657

The Company also entered into contracts which have contracted commitments as follows:

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Strategic Resources Inc. Management discussion and analysis

For the three-month and nine-month periods ended March 31, 2024 (Expressed in thousands of Canadian dollars or other currencies, unless otherwise stated)

Hydro-Québec

Chibougamau

On March 30, 2012, BlackRock entered into a contribution agreement with Hydro-Québec by which HydroQuébec shall provide electricity at high voltage to supply the new electrical installation located east of Lac Chibougamau with a projected available power of 40MW. The total cost of construction of the power line was estimated at $28,400 of which Hydro-Québec would pay for $9,700 of the total costs, and BlackRock would pay the remaining $18,700. On November 7, 2019, the agreement was temporarily suspended to allow for the rescheduling of the project’s construction, with a deemed completion date of September 13, 2020. An amendment signed in October 2021 extended the deemed completion date to June 21, 2022.

The contribution portion of Hydro-Québec is secured by a letter of credit. This letter of credit is to be released over 20 years based on the annual consumption of electricity BlackRock consumes once in operation.

As at March 31, 2024, a letter of credit, renewable every year, of $4,885 was issued by a Canadian bank in favor of Hydro-Québec to cover Hydro-Québec’s portion of the cost of construction incurred to date plus applicable taxes. The letter of credit is secured by restricted investments consisting of a Guaranteed Investment Certificate of the same amount.

In case the project is not completed, or the consumption of electricity is less than as agreed in the contribution agreement, a portion of or the totality of the $4,885 restricted investment will be payable to Hydro-Québec. If the project is not completed by the deemed completion date, BlackRock is required to pay for the cumulative construction costs incurred by Hydro-Québec. As a result, given that the initial deemed completion date of September 13, 2020 has passed without being amended, a liability was recorded in the amount of $4,249 (net of taxes) during the year ended June 30, 2021.

On April 14, 2023, Hydro-Québec granted an extension of the deemed completion date to September 30, 2023, prior to which BlackRock was required to submit a letter of resumption which may trigger a new estimate of the capital costs by Hydro-Québec for which BlackRock may be assessed additional construction costs and financial guarantees. BlackRock submitted the letter of resumption.

In December 2023, BlackRock notified Hydro-Québec that it had decided to release its old electrical contracts and to prioritize the development of an iron ore pellet plant for its first phase of operations. The iron ore pellet plant will require substantially less electricity and the Company intends to obtain a revised electricity contract as part of the construction timeline. As a result, Hydro-Québec has invoiced BlackRock for an amount of $5,585 (including taxes). In April 2024, payment was made in full to Hydro-Québec and the letter of credit was cancelled.

Hydro-Québec

Saguenay

On November 14, 2016, the Company entered into an agreement with Hydro-Québec by which Hydro-Québec shall provide electricity at high voltage to supply the new metallurgical plant located in Saguenay with, projected available power of 85MW. The supply of the 85MW of electricity required for BlackRock’s metallurgical plant in the Saguenay Port industrial zone will require the construction of a 9.1Km 161 Kv multiuser transmission line. The total cost of construction of the power line was estimated at $33,300 of which

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Strategic Resources Inc. Management discussion and analysis

For the three-month and nine-month periods ended March 31, 2024

(Expressed in thousands of Canadian dollars or other currencies, unless otherwise stated)

Hydro-Québec, through a contribution agreement, would pay $30,500 of the total cost, and BlackRock would pay the remaining $2,800.

In 2018, the Port of Saguenay and the Government of Québec agreed to provide the financial guarantees required by Hydro-Québec subject to BlackRock’s construction financing being finalized. On September 12, 2019, the agreement was temporarily suspended to allow for the rescheduling of the project’s construction.

As at March 31, 2024, a letter of credit, renewable every year, of $5,762 was issued by a Canadian bank in favor of Hydro-Québec to cover Hydro-Québec’s portion of the cost of construction to date plus applicable taxes. The letter of credit is secured by restricted investments consisting of a GIC of the same amount. However, the Port of Saguenay and the Government of Québec have agreed to reimburse the letter of credit when the construction financing will be confirmed. The amended contribution agreement contains a deemed completion date of June 21, 2022. If the project is not completed at that time, BlackRock is required to pay for the cumulative construction costs incurred by Hydro-Québec. As a result, given that the deemed completion date of June 21, 2022 has passed, a liability was recorded in the amount of $5,011 (net of taxes) as at June 30, 2022.

On April 14, 2023, Hydro-Québec granted an extension of the deemed completion date to September 30, 2023, prior to which BlackRock was required to submit a letter of resumption which may trigger a new estimate of the capital costs by Hydro-Québec for which BlackRock may be assessed additional construction costs and financial guarantees. BlackRock submitted the letter of resumption.

In December 2023, BlackRock notified Hydro-Québec that it had decided to release its old electrical contracts and to prioritize the development of an iron ore pellet plant for its first phase of operations. The iron ore pellet plant will require substantially less electricity and the Company intends to obtain a revised electricity contract as part of the construction timeline. As a result, Hydro-Québec has invoiced BlackRock for an amount of $4,181. In April 2024, payment was made in full to Hydro-Québec and the letter of credit was cancelled.

In April 2024, BlackRock received a net cash refund of $881, representing the difference between the letters of credit and costs incurred by Hydro-Québec for the above two projects.

Outstanding share capital

The authorized share capital consists of an unlimited number of common shares without par value.

As at May 27, 2024, there were 59,027,995 common shares, 3,300,000 share options, no warrants and 1,128,304 RSU issued and outstanding.

Transaction with related parties

For the nine months ended March 31, 2024, the Company incurred management salaries, bonuses and benefits of $720, share-based compensation of $2,572 and consulting fees of $471 for key management.

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Strategic Resources Inc. Management discussion and analysis

For the three-month and nine-month periods ended March 31, 2024 (Expressed in thousands of Canadian dollars or other currencies, unless otherwise stated)

Off-balance sheet arrangements

Other than the short-term operating lease and services agreement commitments referred to under ‘Commitments and Obligations’ above, the Company had no off-balance sheet arrangements such as guarantee contracts, contingent interest in assets transferred to an entity, derivative instruments or any obligations that would trigger financing, liquidity, market or credit risk to the Company.

Critical accounting policies and estimates

The preparation of consolidated financial statements in conformity with IFRS requires management to apply accounting policies and make estimates and assumptions that affect amounts reported in the consolidated financial statements and accompanying notes. The Company’s critical accounting policies and accounting estimates are disclosed in notes 2 and 4 of the audited consolidated financial statements for the year ended June 30, 2023.

Financial instruments and risk management

The Company’s financial instruments consist of cash, short-term investments, receivables, restricted investments, payables and accrued liabilities. The Company’s financial instruments description and disclosure can be found in note 17 of the condensed interim consolidated financial statements for the period ended March 31, 2024.

The Company’s risk management objectives and policies are disclosed in note 17 of the condensed interim consolidated financial statements for the period ended March 31, 2024.

Subsequent events

There are no subsequent events.

Proposed transactions

There are no proposed transactions.

Risks and uncertainties

The exploration of mineral deposits involves significant risks and uncertainties, which even a combination of careful evaluation, experience and knowledge may not eliminate. Some of the more prominent risk factors that may materially affect the Company’s future performance are listed below.

Strategic depends on one main project.

The BlackRock Project accounts for most of the Company's mineral resources and mineral reserves and represents mainly the current potential for the future generation of revenue. Mineral exploration and development involve a high degree of risk that even a combination of careful evaluation, experience and knowledge cannot eliminate and few properties that are explored are ultimately developed into producing

Page 14 of 21

Strategic Resources Inc. Management discussion and analysis

For the three-month and nine-month periods ended March 31, 2024 (Expressed in thousands of Canadian dollars or other currencies, unless otherwise stated)

mines. Any adverse development affecting the BlackRock Project will have a material adverse effect on our business, prospects, financial position, results of operations and cash flows.

The successful start of mining operations and the development of the metallurgical operations into a commercially viable project cannot be assured.

Development of mineral properties involves a high degree of risk and few properties that are explored are ultimately developed into producing mines. The commercial viability of a mineral deposit is dependent upon several factors which are beyond the Company’s control, including the attributes of the deposit, commodity prices, government policies and regulation and environmental protection. Fluctuations in the market prices of minerals may render resources and deposits containing relatively lower grades of mineralization uneconomic.

There are numerous activities that need to be completed in order to successfully commence development and production at the BlackRock Project, including, without limitation: optimizing the mine plan; recruiting and training personnel; having available funds to finance construction and development activities; avoiding potential increases in costs; negotiating contracts for railway transportation, port loading and handling and for the sale of the Company’s products; updating, renewing and obtaining, as required, all necessary permits, including, without limitation, environmental permits; and handling any other infrastructure issues.

There is no certainty that we will be able to successfully complete these activities, since most of these activities require significant lead times, and we will be required to manage and advance these activities concurrently in order to begin production. A failure or delay in the completion of any one of these activities may delay production, possibly indefinitely, at the BlackRock Project and would have a material adverse effect on our business, prospects, financial position, results of operations and cash flows.

As such, there can be no assurance that the Company will be able to complete development of the BlackRock Project at all, on time or in accordance with any budgets due to, among other things, the delivery and installation of plant and equipment and cost overruns, or that the current personnel, systems, procedures and controls will be adequate to support operations. Failure to successfully complete these events as expected would have a material adverse effect on our business, prospects, financial position, results of operations and cash flows.

There is no assurance that the Company will ever achieve production or will ever be profitable if production is achieved.

Titles and other rights to the Properties cannot be guaranteed and may be subject to prior unregistered agreements, transfers or claims and other defects.

The Company cannot guarantee that title to the Properties will not be challenged. The Company may not have, or may not be able to obtain, all necessary surface rights to develop the BlackRock Project. Title insurance generally is not available for mineral properties, and our ability to ensure that we have obtained secure claim to individual mineral properties or mining concessions comprising the BlackRock Project may be severely constrained. The BlackRock Project may be subject to prior unregistered agreements, transfers or claims, and title may be affected by, among other things, undetected defects. We have not conducted surveys of all the claims in which we hold direct or indirect interests. A successful challenge to the precise area and location of these claims could result in our being unable to operate on all or part of the Company Property as permitted or being unable to enforce our rights with respect to all or part of the Company Property.

Page 15 of 21

Strategic Resources Inc. Management discussion and analysis

For the three-month and nine-month periods ended March 31, 2024 (Expressed in thousands of Canadian dollars or other currencies, unless otherwise stated)

This could result in the Company not being compensated for its prior expenditures relating to its properties. In addition, the Company's ability to continue to explore and develop the properties may be subject to agreements with other third parties including agreements with aboriginal groups.

The Company needs to enter into contracts with external service providers.

Mining, processing, development and exploration activities depend, to one degree or another, on adequate infrastructure. In order to develop a mine and metallurgical facilities, the Company will need to negotiate and conclude various agreements with external service providers for utilities, rail transportation and port loading and handling, and these are important determinants that affect capital and operating costs. The inability to conclude any such agreements and/or the subsequent termination of any such agreements could have a material adverse effect on the Company’s financial position, results of operations and cash flows and render the development of a mine on the BlackRock Project unviable.

The Company's activities are subject to environmental laws and regulations that may increase its costs of doing business and restrict the Company’s operations.

All of our exploration, potential development and production activities in Canada and Finland are subject to regulation by governmental agencies under various environmental laws, including with respect to air emissions, discharges into water, management of waste, management of hazardous substances, protection of natural resources, antiquities and endangered species and reclamation of lands disturbed by mining operations. Compliance with environmental laws and regulations may require significant capital outlays on behalf of the Company and may cause material changes or delays in our intended activities.

There can be no assurance that future changes in environmental regulations will not adversely affect our business, and it is possible that future changes in these laws or regulations could have a significant adverse impact on some portion of our business, causing us to re-evaluate those activities at that time. Failure to comply with applicable environmental laws, regulations and permitting requirements may result in enforcement actions thereunder, including orders issued by regulator or judicial authorities, causing operations to cease or to be curtailed, and may include corrective measures requiring capital expenditures, installation of additional equipment or remedial actions.

The Company may experience difficulty attracting and retaining qualified management and technical personnel to meet the needs of its anticipated growth.

We are dependent on the services of key executives, including our Chairman and Chief Executive Officer and other highly skilled and experienced executives and personnel focused on managing the Company's interests and the advancement of the BlackRock Project and on identifying new opportunities for growth and funding. Due to our relatively small size, the loss of these persons or our inability to attract and retain additional highly skilled employees, on a timely basis or at all, required for the development of our activities may have a material adverse effect on our business or future operations.

We also anticipate that, as we bring the BlackRock Project into production and, where appropriate, acquire additional mineral rights, we will experience significant growth in our operations. We expect this growth to create new positions and responsibilities for management and technical personnel and to increase demands on our operating and financial systems. There can be no assurance that we will successfully meet these demands and effectively attract and retain additional qualified personnel to manage our anticipated growth. The failure to attract such qualified personnel to manage growth would have a material adverse effect on our business, financial position, results of operations and cash flows.

Page 16 of 21

Strategic Resources Inc. Management discussion and analysis

For the three-month and nine-month periods ended March 31, 2024 (Expressed in thousands of Canadian dollars or other currencies, unless otherwise stated)

The Company will require additional capital in the future, and no assurance can be given that such capital will be available at all or available on terms acceptable to the Company.

The Company currently has limited financial resources and no cash flow from production. Further development and exploration of the BlackRock Project depends upon the Company's ability to obtain financing through strategic partnerships, equity or debt financings, production-sharing arrangements or other dilutive or nondilutive means. There is no assurance that the Company will be successful in obtaining required financing on acceptable terms, or at all. If the Company is unable to obtain additional financing it may consider other options, such as (i) selling assets, (ii) selling equity, or (iii) selling interests in the BlackRock or Mustavaara Project. If the Company raises additional funding by issuing additional equity securities or other securities that are convertible into equity securities, such financings may substantially dilute the interest of existing or future shareholders. Sales or issuances of a substantial number of securities, or the perception that such sales could occur, may adversely affect the prevailing market price of the Company's common shares. With any additional sale or issuance of equity securities, investors will suffer dilution of their voting power and may experience dilution in earnings per share. Failure to obtain additional financing could result in an indefinite postponement of further exploration and development of the BlackRock Project and will have a material adverse effect on the Company's business, prospects, financial position, results of operations and cash flows.

The Company is pursuing a financing strategy for the BlackRock Project that includes obtaining a Senior Debt Facility to complete the construction and start-up of the BlackRock Project. There can be no assurance that the Company will receive commitments from lenders for the Senior Debt Facility or that it will be able to negotiate binding agreements with respect to the Senior Debt Facility. There can be no assurance that the Company will successfully conclude the Senior Debt Facility or any of its financing strategy. The failure of the Company to enter the Senior Debt Facility on reasonable terms, or at all, could delay construction and start-up of the BlackRock Project, which would have a material adverse effect on the Company's business, financial position, results of operations and cash flows.

The Company has a history of losses and expects to incur losses for the foreseeable future.

The Company has incurred operating losses since its inception and expects to incur losses for the foreseeable future. We expect to continue to incur losses unless and until such time as the BlackRock Project enters commercial production and generate sufficient revenues to fund continuing operations. The development of the BlackRock Project will require the commitment of substantial financial resources. The amount and timing of expenditures will depend on a number of factors, including the progress of ongoing exploration, evaluation and development, the results of consultant analysis and recommendations, the rate at which operating losses are incurred, the execution of any agreements with strategic partners and our acquisition of additional properties. Some of these factors are beyond our control. There can be no assurance that the Company will ever achieve profitability.

The Company may become party to litigation from time to time in the ordinary course of business.

The Company may become party to litigation from time to time in the ordinary course of business which could adversely affect its business. Should any litigation in which the Company becomes involved be determined against it, such a decision could adversely affect its ability to continue operating and could use significant the Company’s resources. Even if the Company is involved in litigation and wins, litigation can redirect significant company resources.

Page 17 of 21

Strategic Resources Inc. Management discussion and analysis

For the three-month and nine-month periods ended March 31, 2024 (Expressed in thousands of Canadian dollars or other currencies, unless otherwise stated)

Mineral exploration inherently involves a high degree of risk. All of the mineral property interests of the Company are in the exploration and development stage and, consequently, may not result in any commercial discoveries

Mineral exploration involves a high degree of risk. Few properties which are explored are ultimately developed into producing mines. The property interests owned by the Company are in the exploration stage only, are without known bodies of commercial mineralization and the Company has no ongoing mining production at any of them. The Company’s mineral exploration activities may not result in any discoveries of commercial bodies of mineralization. If the Company’s efforts do not result in any discovery of commercial mineralization, the Company will be forced to look for other exploration projects or cease operations. As well, the exploration and development activities of the Company may be disrupted by a variety of risks and hazards, which may be beyond the control of the Company. These risks include, but are not limited to, social and political activism and strife, litigation, labour stoppages, the inability to obtain adequate power, water, trained professionals and labour, including consultants or other experts, as well as suitable machinery and equipment. In addition, the Company may be unable to acquire or obtain such necessities as water and surface rights, which may be critical for the continued advancement of exploration and development activities on its mineral property rights.

The exploration and the development of the Company’s property interests are subject to extensive laws and regulations governing health, safety, environment and communities.

The Company’s exploration and mine development activities are subject to extensive laws and regulations governing the protection of the environment and water, waste disposal, worker and community safety, employee health, mine development, and preservation of archaeological remains, endangered and protected species, as well as extensive reporting and community engagement requirements, and more. The Company’s ability to obtain permits and other approvals and to successfully operate in particular locations may be adversely impacted by real or perceived detrimental events associated with the Company’s activities or those of other mining companies or associations, or even artisanal or illegal miners affecting the environment, human health, and safety of nearby communities. Delays in obtaining or failure to secure government permits and approvals, or to secure evictions of illegal miners or other invaders, may adversely affect the Company’s ability to access, explore or develop its properties. The Company has made, and expects to make in the future, significant expenditures to comply with laws and regulations and to the extent reasonably possible, generate social and economic benefit in nearby communities. Future changes to environmental laws, regulations and permitting processes or changes in their enforcement or regulatory interpretation could have an adverse impact on the Company’s operating and financial condition.

The Company may not be able to obtain or renew permits that are necessary for its operations.

In the ordinary course of business, the Company is required to obtain, as well as renew, government permits for exploration and development activities and any ultimate development, construction and commencement of new mining operations. Obtaining or renewing necessary permits can be a complex and time-consuming process, which at times may involve several political jurisdictions and different government agencies that may not have the necessary expertise, resources or political disposition needed for efficient and timely processing, and may require public hearings and costly undertakings on the Company’s part. The duration and success of the Company’s efforts to obtain and renew permits are contingent upon many variables not within its control, including the interpretation of applicable requirements implemented by permitting authorities, the expertise or diligence of civil servants, challenges presented by social and political actors, and the timeframes for agency decisions. The Company may not be able to obtain or renew permits that are necessary to its operations, or the cost to obtain or renew permits may exceed what the Company believes it can recover from a given property once in production. Any unexpected delays or costs associated with the permitting process could slow exploration

Page 18 of 21

Strategic Resources Inc. Management discussion and analysis

For the three-month and nine-month periods ended March 31, 2024 (Expressed in thousands of Canadian dollars or other currencies, unless otherwise stated)

and/or development or impede the eventual operation of a mine and could adversely impact the Company’s operations and profitability.

The prices of pig iron and vanadium have fluctuated significantly in recent years and may adversely affect the economic viability of any of the Company’s mineral properties.

The Company’s revenues, if any, are expected to be almost entirely derived from the mining, transformation and sale of pig iron and vanadium. The prices of commodities have fluctuated widely, particularly in recent years, and are affected by numerous factors beyond the Company’s control, including: international economic and political trends; expectations of inflation; currency exchange fluctuations; interest rates; consumption patterns; speculative activities; and, increased production due to new mine developments and improved mining and production methods. The effect of these factors on the price of commodities, and, therefore, on the economic viability of any of the Company’s mining properties, cannot be accurately predicted, but nonetheless may adversely impact the Company’s ability to raise capital and conduct its operations.

One of the Company’s subsidiaries and its mineral properties are in foreign countries and, therefore, a portion of the Company’s business may be exposed to political, economic, social, security, and other risks and

uncertainties.

Some of the Company’s mineral properties are located in Finland. It may, therefore, be exposed to various types and degrees of security, economic, labour, political, social and other risks and uncertainties that could arise in this foreign jurisdiction.

The value of the Company’s common shares, as well as its ability to raise equity capital, may be impacted by future issuances of shares

The Company is authorized to issue an unlimited number of common shares without par value. The Company may issue more common shares in the future. Sales of substantial amounts of common shares (including shares issuable upon the exercise of stock options or warrants), or the perception that such sales could occur, could materially adversely affect prevailing market prices for the common shares and the ability of the Company to raise equity capital in the future.

CAUTIONARY NOTE TO UNITED STATES INVESTORS CONCERNING ESTIMATES OF MEASURED, INDICATED AND INFERRED RESOURCES

This MD&A uses the terms “Measured”, “Indicated” and “Inferred” Mineral Resources. United States investors are advised that while such terms are recognized and required by Canadian regulations, the U.S. Securities and Exchange Commission (“SEC”) does not recognize them. “Inferred Mineral Resources” have a great amount of uncertainty as to their existence and as to their economic and legal feasibility. It cannot be assumed that all or any part of an Inferred Mineral Resource will ever be upgraded to a higher category. Under Canadian rules, estimates of Inferred Mineral Resources may not form the basis of feasibility or pre-feasibility studies. United States investors are cautioned not to assume that all or any part of Measured or Indicated Mineral Resources will ever be converted into Mineral Reserves. United States investors are also cautioned not to assume that all or any part of an Inferred Mineral Resource exists or is economically or legally mineable.

Page 19 of 21

Strategic Resources Inc. Management discussion and analysis

For the three-month and nine-month periods ended March 31, 2024 (Expressed in thousands of Canadian dollars or other currencies, unless otherwise stated)

FORWARD-LOOKING INFORMATION

This MD&A contains "forward-looking information" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 and applicable Canadian securities laws concerning anticipated developments and events that may occur in the future.

Forward looking information contained in this MD&A includes, but is not limited to, statements with respect to: (i) the estimation of mineral reserves and mineral resources; (ii) permitting time lines; (iii) the sufficiency of working capital; (iv) requirements for additional capital; (v) development, construction and production timelines and estimates; (vi) the timing of long lead equipment items; (vii) the supply of power and gas for the Project; (viii) the use of financing proceeds; (ix) the results of our Feasibility Study, including statements about estimated future production, future operating and capital costs, the projected internal rate of return (“IRR”), net present value (“NPV”), payback period, construction timelines and production timelines for the Project (as defined below); (x) forecasts for future expenditures; (xi) the Company’s financing strategy for the development of the Project, including the anticipated amount, timing and successful completion of the financing for the construction of the Project, the expected timeline for the commencement of construction and its duration, the negotiation and conclusion of infrastructure contracts, implementation of agreements and ongoing consultation with aboriginal groups and initiatives to secure off-take partners; (xii) the engagement with local authorities to seek to extend existing permits for the Mustavaara Project and plans to begin environmental monitoring programs; (xiii) the Company’s plans and actions required to continue or initiate exploration and drilling programs on its projects; (xiv) the Company’s ability to comply with permitting and regulatory requirements related to exploration and development and related operations, as well as any associated costs and timing; and (xv) any additional risks and uncertainties with regards to the Company’s business.

In certain cases, forward-looking information can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved" suggesting future outcomes, or other expectations, beliefs, plans, objectives, assumptions, intentions or statements about future events or performance.

Forward-looking information contained in this MD&A is based on certain factors and assumptions regarding, among other things, the estimation of mineral reserves and resources, the realization of resource estimates, pig iron and other metal prices, the timing and amount of future exploration and development expenditures, the estimation of initial and sustaining capital requirements, the estimation of labour and operating costs, the availability of necessary financing and materials to continue to explore and develop the BlackRock Project in the short-and long-term, the progress of exploration and development activities, the receipt of necessary regulatory approvals, the estimation of insurance coverage, and assumptions with respect to currency fluctuations, environmental risks, title disputes or claims, and other similar matters. While the Company considers these assumptions to be reasonable based on information currently available to it, these assumptions may prove to be incorrect.

Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ

Page 20 of 21

Strategic Resources Inc. Management discussion and analysis

For the three-month and nine-month periods ended March 31, 2024 (Expressed in thousands of Canadian dollars or other currencies, unless otherwise stated)

materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward-looking information. The forward-looking information is made as of the date of this MD&A.

Readers are cautioned that the foregoing lists of factors are not exhaustive. The forward-looking information contained in this MD&A is expressly qualified by this cautionary statement. Except as required by applicable securities laws, the Company does not undertake any obligation to publicly update or revise any forward-looking information, and readers should also carefully consider the matters discussed under the heading, " Risks and uncertainties ", in this MD&A.

Readers are cautioned that the foregoing lists of factors are not exhaustive. The forward-looking information contained in this MD&A is expressly qualified by this cautionary statement. Except as required by applicable securities laws, the Company does not undertake any obligation to publicly update or revise any forwardlooking information, and readers should also carefully consider the matters discussed under the heading, " Risks and uncertainties ", in this MD&A.

Page 21 of 21