Talisker Resources — Interim / Quarterly Report 2023

Aug 11, 2023

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Condensed Interim Consolidated Financial Statements (Unaudited)

As at and for the three and six months ended June 30, 2023 and 2022

(in Canadian dollars)

Talisker Resources Ltd. Condensed Interim Consolidated Statements of Financial Position (Unaudited) (Expressed in Canadian dollars)

		June 30,	December 31,
As at,	Notes	2023	2022
ASSETS
Current assets
Cash and cash equivalents	4	$ 9,728,474	$ 5,726,452
Amounts receivable	5	202,041	184,076
Inventory		82,258	38,203
Prepaid expenses		608,239	480,558
Total current assets		10,621,012	6,429,289
Reclamation deposits	10	1,468,300	1,468,300
Long term receivable	5	1,807,486	-
Property, plant and equipment	6	6,934,816	7,560,341
Exploration and evaluation assets	7	20,663,250	29,181,106
TOTAL ASSETS		$ 41,494,864	$ 44,639,036
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable and accrued liabilities	8, 16	$ 3,407,122	$ 3,190,754
RSU Liability	14	45,272	114,368
Currentportion of lease obligation	9	131,359	268,134
Total current liabilities		3,583,753	3,573,256
Provision for site reclamation and closure	10	19,286,915	18,977,039
Lease payable	9	-	20,028
Flow throughpremium liability	12	-	1,951,000
Total liabilities		22,870,668	24,521,323
Shareholders' equity
Issued capital	11	98,257,423	98,154,998
Share-based payment reserve	14	3,329,499	3,723,245
Warrant reserve	13	5,957,200	5,957,200
Accumulated deficit		(88,919,926)	(87,717,730)
Total shareholders' equity		18,624,196	20,117,713
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY		$ 41,494,864	$ 44,639,036

Nature of operations and going concern (note 1)

On behalf of the Board:

Signed: “Terence Harbort” Terence Harbort Chief Executive Officer and Director	_Signed: “Morris Prychidny” _
	Morris Prychidny Director

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

1

Talisker Resources Ltd.

Condensed Interim Consolidated Statements of Loss and Comprehensive Loss (Unaudited)

(Expressed in Canadian dollars)

		Three months ended	Three months ended	Six months ended June	Six months ended June	Six months ended June
		June 30,			30,
	Notes	2023	2022	2023		2022
Expenses
Exploration and evaluation expenditures	7	$(823,057) $	6,319,541 $ 200,770		$	15,155,914
Mine care and maintenance costs		286,995	468,694	549,687		1,002,175
Consulting and wages	16	583,962	902,927	1,087,449		1,765,080
Administration		197,995	285,051	377,643		742,372
Share-based expense	14	19,620	44,794	39,023		93,277
Public company costs		210,434	434,493	364,860		725,025
Travel and other		47,963	86,065	104,301		138,388
Depreciation ofproperty, plant and equipment	6	314,320	311,396	628,328		620,873
Total expenses		838,232	8,852,961	3,352,061		20,243,104
Other income and expense
Finance expense (income)		(46,087)	9,454	(41,540)		20,197
Foreign currency translation (gain) loss		(22,092)	2,372	(19,643)		4,259
Realized (gain) on marketable securities		-	(1,119,286)	-		(1,119,286)
Unrealized (gain) on marketable securities		-	(1,678,575)	-		(1,678,575)
Gain on revaluation of RSU liability		(26,225)	(35,152)	(43,558)		(59,173)
Loss from investment in associate		-	-	-		749,073
Loss from disposal of assets		-	71,010	-		71,010
Accretion on site reclamation and closure	10	155,794	145,432	309,876		289,265
		61,390	(2,604,745)	205,135		(1,723,230)
Loss before income taxes		899,622	6,248,216	3,557,196		18,519,874
Income tax recovery	12	-	-	(1,951,000)		(6,986,000)
Net loss and comprehensive loss		$899,622$	6,248,216 $1,606,196		$	11,533,874
Lossper share - basic and diluted		$ 0.00 $	0.02	$ 0.00		$ 0.04
Weighted average common shares outstanding		384,757,250 329,747,317		384,686,593		315,215,665

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

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Talisker Resources Ltd.

Condensed Interim Consolidated Statements of Changes in Shareholders' Equity (Unaudited) (Expressed in Canadian dollars)

				Share-based	Share-based				Retained
	Number of				Payment		Warrant		earnings
	Shares	Issued Capital			Reserve		Reserve		(deficit)		Total
			(Note 11)		(Note 14)		(Note 13)
Balance as at December 31, 2021	285,690,605	$	83,302,460	$	4,152,000	$	4,357,200	$	(69,119,729)	$	22,691,931
Issue of shares pursuant to private placement, net of issue costs (Note 11)	43,593,000		11,742,646		-		-		-		11,742,646
Flow through premium liability (Note 11)	-		(1,637,000)		-		-		-		(1,637,000)
Issue of shares for acquisition of mineral properties (Note 7)	125,000		31,625		-		-		-		31,625
Issued pursuant to agreement	170,213		40,000		-		-		-		40,000
Exercise of RSU's (Note 11)	260,000		80,600		-		-		-		80,600
Expiry of stock options	-		-		(297,960)		-		297,960		-
Net loss for theperiod	-		-		-		-		(11,533,874)		(11,533,874)
Balance as at June 30, 2022	329,838,818		93,560,331		3,854,040		4,357,200	$	(80,355,643)	$	21,415,928
Issue of shares pursuant to private placement, net of issue costs (Note 11)	53,974,000		6,505,667		-		1,600,000		-		8,105,667
Flow through premium liability (Note 11)	-		(1,951,000)		-		-		-		(1,951,000)
Issued pursuant to agreement	266,667		40,000		-		-		-		40,000
Share based payments - options	-		-		6,605		-		-		6,605
Expiry of stock options	-		-		(137,400)		-		137,400		-
Net loss for theperiod	-		-		-		-		(7,499,487)		(7,499,487)
Balance as at December 31, 2022	384,079,485		98,154,998		3,723,245		5,957,200	$	(87,717,730)	$	20,117,713
Issue of shares for acquisition of mineral properties (Note 7)	300,000		34,500		-		-		-		34,500
Exercise of RSU's (Note 11)	476,666		67,925		-		-		-		67,925
Share based payments - options	-		-		10,254		-		-		10,254
Expiry of stock options	-		-		(404,000)		-		404,000		-
Net loss for theperiod	-		-		-		-		(1,606,196)		(1,606,196)
Balance as at June 30, 2023	384,856,151		98,257,423		3,329,499		5,957,200	$	(88,919,926)	$	18,624,196

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

3

Talisker Resources Ltd.

Condensed Interim Consolidated Statements of Cash Flows (Unaudited) (Expressed in Canadian dollars)

For the six monthperiods ended June 30,	Notes		2023		2022
Cash provided by (used in):
Operating activities
Net loss for the period		$	(1,606,196)	$	(11,533,874)
Items not involving cash:
Income tax recovery	12		(1,951,000)		(6,986,000)
Loss from investment in associate			-		749,073
Gain on revaluation of RSU liability			(43,558)		(59,173)
Share based payments	14		52,641		97,505
Shares issued pursuant to agreement			-		40,000
Accretion on site reclamation and closure	10		309,876		289,265
Depreciation of property, plant and equipment	6		628,328		620,873
Loss on disposal of assets			-		71,010
Realized gain on marketable securities			-		(1,119,286)
Unrealized gain on marketable securities			-		(1,678,575)
Shares issued pursuant to property agreement	6		17,250		-
Working capital changes
Change in amounts receivable			(17,965)		94,605
Change in long term receivable			(1,807,486)		-
Change in inventory			(44,055)		4,217
Change in prepaid expenses			(127,681)		106,060
Change in accountspayable and accrued liabilities			216,368		(1,194,202)
Cash flows used in operating activities			(4,373,478)		(20,498,502)
Investing activities
Proceeds from sale of NSR, net of costs	7		8,586,706		-
Acquisition of exploration and evaluation assets	7		(51,600)		(45,000)
Acquisition of property, plant and equipment, net of sales	6		(2,803)		(58,395)
Sales of marketable securities			-		1,274,974
Cashprovided by investing activities			8,532,303		1,171,579
Financing activities
Issue of shares pursuant to private placement	11		-		12,521,752
Share issue costs	11		-		(779,106)
Repayment of lease and equipment loans	9		(156,803)		(147,749)
Cash flows(used in) provided by financing activities			(156,803)		11,594,897
Net increase (decrease) in cash and cash equivalents for the period			4,002,022		(7,732,026)
Cash and cash equivalents, beginning of theperiod			5,726,452		12,571,890
Cash and cash equivalents, end of theperiod		$	9,728,474	$	4,839,864
Supplementary cash flow information
Interest received		$	50,418	$	585

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

4

Notes to the Condensed Interim Consolidated Financial Statements (Unaudited) For the three and six month periods ended June 30, 2023 and 2022 (Expressed in Canadian dollars)

Talisker Resources Ltd.

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1. NATURE OF OPERATIONS AND GOING CONCERN

Talisker Resources Ltd. (“Talisker” or the “Company”) is a publicly listed company incorporated in British Columbia and continued in the Province of Ontario. The Company is engaged in exploration and evaluation of mineral properties in British Columbia. The Company’s shares are traded on the Toronto Stock Exchange (the “TSX”) under the symbol TSK. The head office and registered address of the Company is located at 130 Adelaide Street West, Suite 3002, Toronto, Ontario, M5H 1T1.

The condensed interim consolidated financial statements have been prepared on a going concern basis. The going concern basis assumes that the Company will continue in operation for the foreseeable future and will be able to realize its assets and discharge its liabilities and commitments in the normal course of business.

The Company’s ability to continue as a going concern is dependent upon attaining profitable operations, and the ability to raise public equity or other financing to meet expenditure commitments in the next twelve months. Notwithstanding the financing in Q2 2023 as included in Note 7, there is no assurance that these activities will be successful in the future. As at June 30, 2023, the Company had cash of $9,728,474 and for the six-month period then ended, the Company recorded an accumulated deficit of $88,919,926 (December 31, 2022: $87,717,730), net loss of $1,606,196 (2022: $11,533,874), and net cash used in operating activities of $4,373,478 (2022: $20,498,502). The combination of these circumstances set out above represents a material uncertainty which may cast significant doubt upon the Company’s ability to continue as a going concern as the Company progresses towards the development of the Bralorne Gold project. However, the Company is confident that it will have adequate resources to continue in operational existence for the foreseeable future. For this reason, the Company continues to adopt the going concern basis in preparing its financial statements. These financial statements do not reflect the adjustments to the carrying values of assets and liabilities, the reported revenues and expenses, and the balance sheet classifications used that would be necessary if the going concern assumptions were not appropriate. These adjustments would be material to the financial statements.

These consolidated financial statements were approved and authorized for issuance by the Board of Directors of the Company on August 11, 2023.

2. BASIS OF PRESENTATION

Statement of Compliance

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

Basis of Measurement

These condensed interim consolidated financial statements have been prepared on the basis of accounting policies and methods of computation consistent with those applied in the Company’s December 31, 2022 annual financial statements.

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Talisker Resources Ltd.

Notes to the Condensed Interim Consolidated Financial Statements (Unaudited) For the three and six month periods ended June 30, 2023 and 2022 (Expressed in Canadian dollars)

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2. BASIS OF PRESENTATION (continued)

Principles of Consolidation

These condensed interim consolidated financial statements for the three and six month periods ended June 30, 2023 and 2022 include the financial position, financial performance and cash flows of the Company and its subsidiary detailed below:

Subsidiary	Country of Incorporation	Economic Interest	Basis of Accounting
Bralorne Gold Mines Ltd.	Canada	100%	Full consolidation
New Carolin Gold Corp.	Canada	100%	Full consolidation

Subsidiaries - Subsidiaries are entities over which the Company has control, whereby control is defined as the power to direct activities of an entity that significantly affect the entity’s returns so as to obtain benefit from its activities. Control is presumed to exist where the Company has a shareholding of more than one half of the voting rights in its subsidiaries. The effects of potential voting rights that are currently exercisable are considered when assessing whether control exists. Subsidiaries are fully consolidated from the date control is transferred to the Company, and are de-consolidated from the date at which control ceases.

3. SIGNIFICANT ACCOUNTING JUDGMENTS, ESTIMATES AND ASSUMPTIONS

The preparation of financial statements in conformity with IFRS requires the Company’s management to make judgments, estimates and assumptions about future events that affect the amounts reported in the financial statements. Although these estimates are based on management’s best knowledge of the amount, event or actions, actual results may differ from those estimates.

The areas which require management to make significant judgments, estimates and assumptions in determining carrying values include, but are not limited to:

• Exploration and Evaluation Assets’ carrying values and impairment charges - The Company assesses its cashgenerating units at each reporting date to determine whether any indication of impairment exists. Where an indicator of impairment exists, an estimate of the recoverable amount is made, which is the higher of the fair value less costs of disposal and value in use. The determination of the recoverable amount requires the use of estimates and assumptions such as long-term commodity prices, discount rates, future capital requirements, exploration potential and future operating performance. Fair value is determined as the amount that would be obtained from the sale of the asset in an arm's-length transaction between knowledgeable and willing parties.

• Share-based payments – The Company determines costs for share-based payments using market-based valuation techniques. The fair value of the market-based and performance-based non-vested share awards are determined at the date of grant using generally accepted valuation techniques. Assumptions are made and judgment used in applying valuation techniques. These assumptions and judgments include estimating the future volatility of the stock price, expected dividend yield, future employee turnover rates and future employee stock option exercise behaviors and corporate performance. Such judgments and assumptions are inherently uncertain. Changes in these assumptions affect the fair value estimates.

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6

Notes to the Condensed Interim Consolidated Financial Statements (Unaudited) For the three and six month periods ended June 30, 2023 and 2022 (Expressed in Canadian dollars)

Talisker Resources Ltd.

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3. SIGNIFICANT ACCOUNTING JUDGMENTS, ESTIMATES AND ASSUMPTIONS (continued)

• Provision for site reclamation and closure – Provisions for site reclamation and closure have been created based on management estimates. Assumptions, based on the current economic environment, have been made which management believes are a reasonable basis upon which to estimate the future liability as shown in Note 10. These estimates take into account any material changes to the assumptions that occur when reviewed regularly by management and are based on current regulatory requirements. Significant changes in estimates of discount rate, contamination, restoration standards and techniques will result in changes to provisions from period to period. Actual reclamation and closure costs will ultimately depend on future market prices for the costs which will reflect the market condition at the time the costs are actually incurred. The final cost of the currently recognized rehabilitation provisions may be higher or lower than currently provided for.

4. CASH AND CASH EQUIVALENTS

The balance at June 30, 2023 consists of cash on deposit with major Canadian banks in interest bearing accounts totaling $9,728,474 (December 31, 2022 - $5,626,452) and guaranteed investment certificates with major Canadian banks of $100,000 (December 31, 2022 - $100,000) for total cash and cash equivalents of $9,628,474 (December 31, 2022 - $5,726,452).

During the six month period ended June 30, 2023, the Company recognized interest income of $50,418 (2022 - $585).

5. AMOUNTS RECEIVABLE

As at,	June 30, 2023 December 31, 2022
HST receivable $ Other receivables $	159,579 $ 161,251 42,462 22,825
	202,041 $ 184,076

At June 30, 2023, the Company anticipates full recovery of these amounts and therefore no expected credit loss has been recorded against these receivables. The Company holds no collateral for any receivable amounts outstanding as at June 30, 2023 and December 31, 2022.

Long Term Receivable

As at June 30, 2023, the Company recognized a receivable of $1,807,486 (December 31, 2022 - $nil) related to B.C. tax mining credits. The Company expects to receive the refund pending the standard review process by CRA which may take longer than 12 months.

7

Talisker Resources Ltd.

Notes to the Condensed Interim Consolidated Financial Statements (Unaudited) For the three and six month periods ended June 30, 2023 and 2022

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(Expressed in Canadian dollars)

6. PROPERTY, PLANT AND EQUIPMENT

	Machinery and Equipment $ Buildings $ Land $ Water Treatment Facility $ Vehicles $ Right-of-Use Asset $ Total $
Balance at December 31, 2021 Additions Disposals Balance at December 31, 2022 Additions Disposals Balance at June 30, 2023	1,329,352 5,813,395 315,000 941,321 174,560 1,496,476 10,070,104 14,024 94,547 - - - - 108,571 (77,172) - - - (2,169) - (79,341)
	1,266,204 5,907,942 315,000 941,321 172,391 1,496,476 10,099,334 2,803 - - - - - 2,803 - - - - - - -
	1,269,007 5,907,942 315,000 941,321 172,391 1,496,476 10,102,137
ACCUMULATED DEPRECIATION
Balance at December 31, 2021 Additions Disposals Balance at December 31, 2022 Additions Disposals Balance at June 30, 2023	396,716 131,375 - 148,784 43,659 569,775 1,290,309 373,962 437,852 - 62,060 23,153 351,657 1,248,684 - - - - - - -
	770,678 569,227 - 210,844 66,812 921,432 2,538,993 189,513 220,550 - 31,030 11,407 175,828 628,328 - - - - - - -
	960,191 789,777 - 241,874 78,219 1,097,260 3,167,321
NET BOOK VALUE
At December 31, 2022 At June 30, 2023	495,526 5,338,715 315,000 730,477 105,579 575,044 7,560,341 308,816 5,118,165 315,000 699,447 94,172 399,216 6,934,816

8

Talisker Resources Ltd.

Notes to the Condensed Interim Consolidated Financial Statements (Unaudited) For the three and six month periods ended June 30, 2023 and 2022 (Expressed in Canadian dollars)

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7. EXPLORATION AND EVALUATION ASSETS

The exploration and evaluation assets for the Company are summarized as follows:

Six month period ended June 30, 2023

Project	January1,2023	Additions	Disposals	Impairment	June 30,2023
Bralorne Gold Camp
Bralorne Gold Project	10,723,883 $ - $ (8,586,706)			$ -$	2,137,177
Royalle Property	243,000	-	-	-	243,000
NaiKun Wind Crown Grant	36,000	-	-	-	36,000
Congress Property	295,000	-	-	-	295,000
Big Sheep Property	120,000	-	-	-	120,000
Southern BC Properties
Spences Bridge	5,701,823	-	-	-	5,701,823
Golden Hornet Property	-	67,550	-	-	67,550
Ladner Gold Project	12,061,400	1,300	-	-	12,062,700
	$29,181,106$	68,850$ (8,586,706)		$- $	20,663,250

1 WCGG Properties included the Tulameen South, Bluejay and Sauchi Creek properties.

During the six month period ended June 30, 2023, the Company issued 300,000 shares with a value of $34,500 and made cash payments of $101,600 for property acquisitions on the Golden Hornet property and Dora Project. The costs for the Dora project amounting to $67,250 were expensed to exploration and evaluation expenses for the six month period ended June 30, 2023.

On June 12, 2023 the Company entered into a royalty agreement with Sprott Resource Streaming and Royalty Corp. (“Sprott”) in relation to the Company’s Bralorne Gold Project whereby Sprott will pay the Company up to US$31,250,000 for a net smelter returns royalty (the “Royalty”) covering all minerals produced from the Project (the “Royalty Transaction”). The Royalty Transaction includes:

• A maximum of US$31,250,000, with a minimum consideration of US$18,750,000, payable as to:

• an initial grant of a 1.12% Royalty for a draw of US$7,000,000 (received) for drilling, detailed engineering and working capital;

• a further 1.88% Royalty for a subsequent draw of US$11,750,000 on, among other things, the signing of a toll milling agreement for mobilization, site infrastructure, resource conversion drilling and working capital; and

• up to a further 2% Royalty, to a maximum of a 5% Royalty, for US$12,500,000 available as needed for site infrastructure, mine start-up capital and working capital;

• An option, exercisable solely at the discretion of the Company until December 31, 2028, to repurchase 50% of the Royalty (as more particularly described below);

• The residual Royalty will be reduced by an additional 50% for no additional consideration following 1.5 million ounces of gold production;

9

Notes to the Condensed Interim Consolidated Financial Statements (Unaudited) For the three and six month periods ended June 30, 2023 and 2022 (Expressed in Canadian dollars)

Talisker Resources Ltd.

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7. EXPLORATION AND EVALUATION ASSETS (continued)

Buyback

The Company will have a right, to be satisfied in cash or in shares (subject to a 4.9% ownership limit, calculated at the time of the buyback), at the Company’s sole discretion (and subject to prior approval of the Toronto Stock Exchange (the “TSX”)), to repurchase a 50% interest of the Royalty for a price that is equal to half of the then-paid Purchase Price multiplied by the multiplier, as follows:

On of before	Multiplier	Based on Minimum 3% Royalty	Based on Maximum 5% Royalty
December 31,2024	1.20	US$11,250,000	US$18,750,000
December 31,2025	1.25	US$11,718,750	US$19,531,250
December 31,2026	1.30	US$12,187,500	US$20,312,500
December 31,2027	1.35	US$12,656,250	US$21,093,750
December 31,2028	1.40	US$13,125,000	US$21,875,000

Production Target and Purchase Price Repayment

There is an amount payable under the Royalty agreement by the Company if aggregate sales of contained gold in product is not equal to or greater than 38,000 ounces for the period commencing on July 1, 2026 and ending on December 31, 2026 (inclusive). The Purchase price repayment is calculated as follows:

APP x (T-P)/T) x (1+r)^Q), where:

APP = Aggregate Purchase Price or dollar amount received under the facility;

T = the Target Amount;

P = the aggregate Sales of contained gold in Product during the Sales Testing Period;

r = the Quarterly interest rate of 2.5%; and

Q = the number of Quarter ends that have occurred from the First Closing Date up to (15), and including the last day of the Quarter in which the Sales Testing Period expires.

Participation Right

The Company has granted a five year pre-emptive right (subject to rights previously granted to Osisko Gold Royalties Ltd.) to participate up to a maximum of 40%, or US$40,000,000, in any proposed grant, sale or issuance to any third party of a stream, royalty or similar transaction based on future production from the Project.

As of June 23, 2023, the Company completed the initial draw of US$7,000,000 has received proceeds in the amount of $9,239,300 (US$7,000,000) less $652,594 in transaction fees which was recorded as a reduction in exploration and evaluation assets for the six month period ended June 30, 2023.

8. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

As at,	June 30, 2023 December 31, 2022
Accounts payable Accrued liabilities	$ 1,679,776 $ 1,393,517 1,727,346 1,797,237
	$ 3,407,122 $ 3,190,754

10

Talisker Resources Ltd.

Notes to the Condensed Interim Consolidated Financial Statements (Unaudited) For the three and six month periods ended June 30, 2023 and 2022 (Expressed in Canadian dollars)

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9. LEASES PAYABLE

The Company has entered into equipment leases expiring between 2023 and 2024, with interest rates ranging from 4.95% to 5.90% per annum. The Company has the option to purchase the equipment at the end of the lease term for a nominal amount. The Company’s obligations under finance leases are secured by the lessor’s title to the leased assets.

The contractual maturities and interest charges in respect of the Company’s finance lease obligations are as follows:

		June 30, 2023 December 31, 2022
Not later than one year Later than one year and not later than five years Less: Future interest charges Present value of lease payments Less: current portion Non-currentportion	$	134,552$ 279,879 - 20,296 (3,193) (12,013)
	$	131,359 288,162 (131,359) (268,134)
		-$ 20,028

Reconciliation of debt arising from lease liabilities:

Reconciliation of debt arising from lease liabilities:
		June 30,	December 31,
		2023	2022
Lease liability at beginning of year	$	288,162$	589,524
Principalpayments on lease liabilities		(156,803)	(301,362)
	$	131,359$	288,162

10. PROVISION FOR SITE RECLAMATION AND CLOSURE

Provincial laws and regulations concerning environmental protection affect the Company’s exploration and operations. Under current regulations, the Company is required to meet performance standards to minimize the environmental impact from its activities and to perform site restoration and other closure activities. The Company’s provision for future site closure and reclamation costs is based on known requirements.

The breakdown of the provision for site reclamation and closure is as per below:

Balance, beginning of period/year Change in estimate Accretion Balance,end ofperiod/year	Bralorne New Carolin Total 11,697,368 7,279,671 18,977,039 - - - 190,923 118,953 309,876 11,888,291 7,398,624 19,286,915 June 30, 2023	December 31,2022
		Bralorne New Carolin Total
		15,784,000 7,528,532 23,312,532 (4,488,040) (430,778) (4,918,818) 401,408 181,917 583,325
		11,697,368 7,279,671 18,977,039

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Talisker Resources Ltd. Notes to the Condensed Interim Consolidated Financial Statements (Unaudited) For the three and six month periods ended June 30, 2023 and 2022 (Expressed in Canadian dollars)

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10. PROVISION FOR SITE RECLAMATION AND CLOSURE (continued)

The present value of the obligation for Bralorne of $11,888,291 (December 31, 2022 – $11,697,368) is based on an undiscounted obligation of $60,652,591, out of which $10,338,294 is expected to be incurred in 2040 with the remaining $50,314,297 to be incurred on water treatment and quality monitoring throughout 2140. The provision was calculated using a weighted average risk-free interest rate of 3.3% (December 31, 2022 – 3.3%) and a weighted average inflation rate of 2.1% (December 31, 2022 – 2.1%). Reclamation activities are estimated to begin in 2040 and are expected to be incurred over a period of 100 years.

The present value of the obligation for Ladner Lake of $7,398,624 (December 31, 2022 – $7,279,671). The provision was calculated using a weighted average risk-free interest rate of 3.3% (December 31, 2022 – 3.3%). and a weighted average inflation rate of 2.1% (December 31, 2022 – 2.1%). Reclamation activities are estimated to begin in 2023 and are expected to be incurred over a period of 100 years

Reclamation Deposits

The Company is required to make reclamation deposits in respect of its expected site reclamation and closure obligations. The reclamation deposits represent collateral for possible reclamation activities necessary on mineral properties in connection with the permits required for exploration activities by the Company.

	Talisker Bralorne New Carolin Total Talisker Bralorne New Carolin Total 58,300 1,190,000 220,000 1,468,300 58,300 1,190,000 220,000 1,468,300 - - - - - - - - - - - -- - - - 58,300 1,190,000 220,000 1,468,300 58,300 1,190,000 220,000 1,468,300 June 30, 2023 December 31,2022
Balance, beginning of period/year Additions Disposals
Balance,end ofperiod/year

Under the Ministry of Energy, Mines and Petroleum Resources (“MEM”), the Company is required to hold reclamation bonds that cover the estimated future cost to reclaim the ground disturbed. Bralorne is required to pay $250,000 every six months until a cumulative security equal to $12,300,000. At June 30, 2023, the surety amounted to $3,480,000 and the Company has placed $1,190,000 in cash (December 31, 2022 - $1,190,000), totalling $4,670,000 to cover estimated future costs related to the ground disturbance at the Company’s Bralorne Gold Project. As at June 30, 2023 the Company is current with all its obligations with the MEM.

In connection with the Ladner Gold Project, under New Carolin, the Company has a total of $220,000 placed with the Province of British Columbia in environmental and mining bonds.

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Notes to the Condensed Interim Consolidated Financial Statements (Unaudited) For the three and six month periods ended June 30, 2023 and 2022

Talisker Resources Ltd.

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(Expressed in Canadian dollars)

11. ISSUED CAPITAL

Authorized Unlimited common shares without par value

	June 30, 2023 December 31, 2022
Issued capital Fully paid common shares(1)	$ 98,257,423 $ 98,154,998
	384,856,151 384,079,485

(1) As at June 30, 2023 and December 31, 2022, there are 250,000 shares awaiting issuance, the proceeds for which were received in 2008 and are included in share capital.

Common Shares Issued

	Number of	Value of
	Shares	Shares
Balance as at December 31, 2021	285,690,605	$ 83,302,460
Issue of shares pursuant to private placement, net of issue costs	97,567,000	18,248,313
Flow through premium liability	-	(3,588,000)
Issue of shares for acquisition of mineral properties (Note 7)	125,000	31,625
Issued pursuant to agreement	436,880	80,000
Exercise of RSU's	260,000	80,600
Balance as at December 31, 2022	384,079,485	$ 98,154,998
Exercise of RSU's	476,666	67,925
Issue of shares for acquisition of mineralproperties(Note 7)	300,000	34,500
Balance as at June 30, 2023	384,856,151	$ 98,257,423

Diluted Weighted Average Number of Shares Outstanding

Basic weighted average shares outstanding: Effect of outstanding securities Diluted weighted average shares outstanding	Three months ended Six months ended June 30, 2023 June 30, 2022 June 30, 2023 June 30, 2022
	384,757,250 329,747,317 384,686,593 315,215,665 - - - -
	384,757,250 329,747,317 384,686,593 315,215,665

During the three and six month periods ended June 30, 2023 and 2022, the Company had a net loss, as such, the diluted loss per share calculation excludes any potential conversion of options and warrants that would decrease loss per share.

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Talisker Resources Ltd. Notes to the Condensed Interim Consolidated Financial Statements (Unaudited) For the three and six month periods ended June 30, 2023 and 2022 (Expressed in Canadian dollars)

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12. FLOW-THROUGH PREMIUM LIABILITY

For the purposes of calculating the tax effect of any premium related to the issuances of the flow-through shares, the Company reviewed the share price of the Company’s common shares and compared it to determine if there was a premium paid on the shares.

Six months ended June 30, 2023

During the six month period ended June 30, 2023, the Company recognized an amount of $1,951,000, in relation to flow-through private placements closed in the prior year and has recorded the gain as income tax recovery upon filing of renunciation documents with the Canada Revenue Agency which occurred during the six month period ended June 30, 2023.

Six months ended June 30, 2022

For the six month period ended June 30, 2022, the Company recognized a $1,637,000 as a flow-through premium liability on issuance in connection with private placements closed during the six month period ended June 30, 2022.

During the six month period ended June 30, 2022, the Company recognized an amount of $6,986,000, in relation to flow-through private placements closed in the prior year and has recorded the gain as income tax recovery upon filing of renunciation documents with the Canada Revenue Agency which occurred during the six month period ended June 30, 2022.

13. WARRANTS RESERVE

The following is a summary of changes in warrants:

The following is a summary of changes in warrants:
	Number of Warrants Weighted average exercise price per warrant Amount
Balance, December 31, 2021	7,722,476 $ 0.42 $ 4,357,200
Issuance of warrants	28,398,000 0.24 1,600,000
Expiryof warrants	(7,722,476) 0.42 -
Balance, December 31, 2022 and June 30, 2023	28,398,000 $0.24 $5,957,200

As at June 30, 2023, the Company had outstanding warrants as follows:

	Exercise	Outstanding and
ExpiryDate	Price	exercisable
February 11, 2025	$0.24	28,398,000
Balance, June 30, 2023		28,398,000

During the year ended December 31, 2022, 610,728 warrants expiring February 4, 2022, 2,110,446 warrants expiring May 8, 2022 and 5,001,302 warrants expiring August 27, 2022, expired unexercised.

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Talisker Resources Ltd. Notes to the Condensed Interim Consolidated Financial Statements (Unaudited) For the three and six month periods ended June 30, 2023 and 2022 (Expressed in Canadian dollars)

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14. SHARE-BASED PAYMENT RESERVE

Stock Option Plan

The Board of Directors of the Company adopted a stock option plan (the “Plan") whereby the aggregate number of common shares reserved for issuance under the Plan, including common shares reserved for issuance under any other share compensation arrangement granted or made available by the Company from time to time, may not exceed 10% of the Company's issued and outstanding common shares. The Plan is administered by the Board of Directors and grants made pursuant to the Plan must at all times comply with regulatory policies.

The terms of any options granted under the Plan are fixed by the Board of Directors and may not exceed a term of five years. The exercise price of the options granted under the Plan is set at the last closing price of the Company’s common shares before the date of grant or in accordance with regulatory requirements.

Each share option converts into one common share of the Company on exercise. No amounts are paid or payable by the recipient on receipt of the option. The options carry neither rights to dividends nor voting rights. Options may be exercised at any time from the date of vesting to the date of their expiry.

The following options were outstanding as at June 30, 2023:

Number of	Number of
options	exercisable				Exercise	Fair value
outstanding	options	Grant date	Expirydate		price	vested
50,000	50,000	August 22, 2018	August 22, 2023	$	0.24	5,000
2,750,000	2,750,000	June 18, 2019	June 18, 2024	$	0.20	269,000
4,200,000	4,200,000	December 27, 2019	December 27, 2024	$	0.295	925,960
900,000	900,000	February 14, 2020	February 14, 2025	$	0.390	311,000
600,000	600,000	August 20, 2020	August 20, 2025	$	0.460	184,680
2,925,000	2,925,000	December 11, 2020	December 11, 2025	$	0.330	715,000
4,120,000	4,120,000	December 7, 2021	December 7, 2026	$	0.315	902,000
500,000	250,000	October 31,2022	October 31,2024	$	0.115	16,859
16,045,000	15,795,000					3,329,499

The share options outstanding as at June 30, 2023 had a weighted exercise price of $0.30 (December 31, 2022: $0.30) and a weighted average remaining contractual life of 2.10 years (December 31, 2022: 2.59 years).

All options vested on their date of issue and expire within five years of their issue, or 90 days after the resignation of the director, officer, employee or consultant.

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Talisker Resources Ltd.

Notes to the Condensed Interim Consolidated Financial Statements (Unaudited) For the three and six month periods ended June 30, 2023 and 2022 (Expressed in Canadian dollars)

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14. SHARE-BASED PAYMENT RESERVE (continued)

Movements in Share Options During the Period

The following reconciles the share options outstanding for the six month period ended June 30, 2023 and year ended December 31, 2022:

December 31, 2022:
		Weighted average
	Number of options	exerciseprice
Balance as at December 31, 2021	19,195,000	$ 0.31
Granted	500,000	$ 0.115
Expired	(1,710,000)	$0.36
Balance as at December 31, 2022	17,985,000	$ 0.30
Expired	(1,940,000)	$0.30
Balance as at June 30, 2023	16,045,000	$ 0.30

Restricted Share Units

The Restricted Share Unit Plan (RSU Plan) provides for the grant of restricted share units (each, an “ RSU ”) convertible into a maximum number of common shares equal to ten percent (10%) of the number of common shares then issued and outstanding, provided, however, the number of common shares reserved for issuance from treasury under the RSU Plan and pursuant to all other security-based compensation arrangements of the Company shall, in the aggregate, not exceed ten percent (10%) of the number of common shares then issued and outstanding. Any common shares subject to a RSU which has been cancelled or terminated in accordance with the terms of the RSU Plan without settlement will again be available under the RSU Plan. When vested, each RSU entitles the holder to receive, subject to adjustments as provided for in the RSU Plan, one common Share or payment in cash for the equivalent thereof based on the volume weighted average trading price of the common shares on the five trading days immediately preceding the redemption date. The terms and conditions of vesting (if applicable) of each grant are determined by the Board at the time of the grant, subject to the terms of the RSU Plan. RSU awards may, but need not, be subject to performance incentives to reward attainment of annual or long-term performance goals. Any such performance incentives or long term performance goals are subject to determination by the Board and specified in the award agreement.

The Company uses the fair value method to recognize the obligation and compensation expense associated with the RSUs. The fair value of RSUs issued is determined on the grant date based on the market price of the common shares on the grant date multiplied by the number of RSUs granted. The fair value is expensed over the vesting term. Upon redemption of the RSU the carrying amount is recorded as an increase in common share capital and a reduction in the liability.

16

Talisker Resources Ltd.

Notes to the Condensed Interim Consolidated Financial Statements (Unaudited) For the three and six month periods ended June 30, 2023 and 2022

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(Expressed in Canadian dollars)

14. SHARE-BASED PAYMENT RESERVE (continued)

The following table summarizes changes in the number of RSUs outstanding:

	Number of	Weighted average
	RSU’s	fair value
Balance, December 31, 2021	1,430,000	$ 0.32
Exercised	(260,000)	$0.31
Balance, December 31, 2022	1,170,000	$ 0.32
Exercised	(476,666)	$0.31
Balance,June 30,2023	693,334	$0.32

RSU liability:

As at June 30, 2023 a liability of $45,272 (December 31, 2022 - $114,368) has been recorded for RSUs.

The following table summarizes information about share-based payment reserve:

Balance as at December 31, 2021	$ 4,152,000
Share-based expense - options	6,605
Expiry of stock options	(435,360)
Balance as at December 31, 2022	$ 3,723,245
Share-based expense - options	10,254
Expiry of stock options	(404,000)
Balance as at June 30,2023	$ 3,329,499

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Talisker Resources Ltd.

Notes to the Condensed Interim Consolidated Financial Statements (Unaudited) For the three and six month periods ended June 30, 2023 and 2022 (Expressed in Canadian dollars)

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15. FINANCIAL INSTRUMENTS

Financial assets and financial liabilities as at June 30, 2023 and December 31, 2022 were as follows:

		Fair value
		through			Other financial
	profit of loss		Amortized cost			liabilities		Total
As at June 30, 2023
Cash and cash equivalents	$	-	$	9,728,474	$	-	$	9,728,474
Reclamation deposits		-		1,468,300		-		1,468,300
Accounts payable and accrued liabilities		-		-		3,407,122		3,407,122
RSU liability		45,272		-		-		45,272
Leases payable		-		-		131,359		131,359
As at December 31, 2022
Cash and cash equivalents	$	-	$	5,726,452	$	-	$	5,726,452
Reclamation deposits		-		1,468,300		-		1,468,300
Accounts payable and accrued liabilities		-		-		3,190,754		3,190,754
RSU liability		114,368		-		-		114,368
Leases payable		-		-		288,162		288,162

The Company classifies its financial instruments carried at fair value according to a three level hierarchy that reflects the significance of the inputs used in making the fair value measurements. The three levels of fair value hierarchy are as follows:

• Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities;

• Level 2 - Inputs other than quoted prices that are observable for assets and liabilities, either directly or indirectly;

• Level 3 – Inputs for assets or liabilities that are not based on observable market data

The carrying value of cash and cash equivalents, amounts receivable, reclamation deposits, accounts payable and accrued liabilities and leases and loan payables approximate fair value because of the limited terms of these instruments.

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Talisker Resources Ltd.

Notes to the Condensed Interim Consolidated Financial Statements (Unaudited) For the three and six month periods ended June 30, 2023 and 2022 (Expressed in Canadian dollars)

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16. RELATED PARTY DISCLOSURES

The following is a summary of the Company’s related party transactions during the six month periods ended June 30, 2023 and 2022:

The Company charged rent and other costs in the amount of $30,000 for the six month period ended June 30, 2023 (2022 - $9,000) paid by Millennial Precious Metals Corp., a company with certain common directors and officers.

The Company incurred operations costs in the amount of $120,702 for the six month period ended June 30, 2023 (2022 - $56,075) paid to JDS Energy & Mining Inc., a company with certain common former directors.

Compensation of Key Management Personnel of the Company

In accordance with IAS 24, key management personnel, including companies controlled by them, are those persons having authority and responsibility for planning, directing and controlling the activities of the Company directly or indirectly, including any directors (executive and non-executive) of the Company.

The remuneration of directors and key executives is determined by the compensation committee.

The remuneration of directors and other members of key management personnel during the six month periods ended June 30, 2023 and 2022 were as follows:

	June 30, 2023 June 30, 2022
Short term employee benefits, director fees Share based payments	$ 983,658 $ 923,741 42,386 97,504
	$ 1,026,044 $1,021,245

As at June 30, 2023, an amount of $440,239 (December 31, 2022 - $491,376) due to key management personnel, was included in accounts payable and accrued liabilities. This amount is unsecured, non-interest bearing and without fixed terms of repayment.

17. COMMITMENTS AND CONTINGENCIES

Flow-Through Shares

As at June 30, 2023, the Company was committed to spending approximately $2,400,000 to be spent by December 31, 2023 in connection with its flow-through offerings (December 31, 2022 - $3,045,000).

Due to the size, complexity and nature of the Company’s operations, various legal, tax, environmental and regulatory matters are outstanding from time to time. By their nature, contingencies will only be resolved when one or more future events occur or fail to occur. The assessment of contingencies inherently involves the exercise of significant judgment and estimates of the outcome of future events.

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