Western Exploration Inc. — Management Reports 2022

Apr 28, 2022

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WESTERN EXPLORATION, INC.(Formerly, Crystal Peak Minerals Inc.) MANAGEMENT’S DISCUSSION & ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2021.

DATED: April 27, 2022

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WESTERN EXPLORATION, INC. (Formerly, Crystal Peak Minerals Inc.) MANAGEMENT’S DISCUSSION & ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2021

Management Discussion and Analysis

This Management's Discussion and Analysis (“MD&A”) compares the financial results of Western Exploration Inc., formerly Crystal Peak Minerals, Inc. ( referred to as “Western” or the “Company”) for the year ended December 31, 2021 (“fiscal 2021”) with the comparable period in 2020 (“fiscal 2020”). This MD&A has been prepared as at April 26, 2022 and should be read in conjunction with the audited consolidated financial statements and accompanying notes for the year ended December 31, 2021 and the MD&A for all relevant periods.

Financial information for fiscal 2021 and the same period 2020 set forth in this MDA has been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”) and Interpretations issued by the International Financial Reporting Interpretations Committee (“IFRIC”).

All amounts are presented in US$ unless otherwise stated.

History of the Company

Western, formerly Crystal Peak Minerals, Inc. (“CPM”), was originally incorporated in the Yukon Territory, Canada on June 25, 2015. The Company commenced trading on the TSX Venture Exchange (the “TSXV”) under the symbol “CPM.” Effective November 13, 2020, the listing of the Company’s common shares was transferred from the TSXV to the TSX NEX Board as a result of the corporate restructuring in connection with a Reverse Take Over transaction (the “RTO”). The Company’s registered and records office is located at Suite 2500, Park Place, 666 Burrard Street, Vancouver, British Columbia. The Company has an operations and project office in the United States at Suite 140, 121 Woodland Avenue in Reno, Nevada.

On February 19, 2021, Western entered into a definitive arrangement agreement with CPM which outlined a Reverse Take Over of CPM by the Company. The arrangement agreement was amended by the parties on July 12, 2021, October 12, 2021, and November 9, 2021. The transactions described in the arrangement agreement were affected pursuant to a statutory plan of arrangement (the "Arrangement") under Part 9, Division 5 of the Business Corporations Act (British Columbia) (the "BCBCA"), following the continuance of CPM from the Yukon Territory to British Columbia, which was required in order for the arrangement to proceed under the BCBCA. CPM shareholders voted to approve the arrangement on December 15, 2021 and Supreme Court of British Colombia issued the approval of the arrangement on December 17, 2021.

On December 22, 2021, the Company changed its name from Crystal Peak Minerals Inc. to Western Exploration Inc. in conjunction with the RTO and resumed trading on the TSXV at the opening of the market under the new symbol “WEX” on January 19, 2022. On February 14, 2022, the Company also began trading on the OTCQX under the symbol of “WEXPF”.

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WESTERN EXPLORATION, INC. (Formerly, Crystal Peak Minerals Inc.) MANAGEMENT’S DISCUSSION & ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2021

OVERVIEW

Western is principally engaged in the evaluation, acquisition and exploration of precious metal properties located in the state of Nevada. The Company’s projects contain exploration targets ranging from earlystage exploration to advanced-stage resource delineation and expansion. The Company’s business model is to build shareholder value through systematic project advancement while concurrently maintaining an opportunistic approach to the acquisition of additional precious metals properties. All the Company’s projects are conducted pursuant to claims, leases, permits, and licenses granted by appropriate authorities or on fee land owned by the Company. In the future, when deemed appropriate certain projects may be pursued on a joint venture basis to share the associated risk and to assist in the project funding.

Mineral Projects

Western has an interest in one exploration project in Nevada, the Aura Project, and had, up until October 5, 2021, a residual interest for an NSR and an exploration success payment at a former project, the Trout Creek project.

The Aura project is at an advanced exploration stage with numerous drilling campaigns having been completed and mineral resource estimates stated. The company continues an active exploration effort at Aura and has the financial resources to complete the Phase 1 exploration as proposed in the Technical Report with a budget of approximately $2,840,000.

The Trout Creek project which was sold in 2019 was acquired from Doby George LLC in January 2019, for $100,000 and subsequently sold to Marigold Mining Company (“Marigold”) a subsidiary of SSR Mining with a future net smelter royalty of up to 1%, and a maximum top up payment based on new resources of up to $4,000,000. The resulting sale of the property resulted in a gain of $950,000. The future net smelter royalty and the top up payment were subsequently sold to Marigold for $1,650,000 on October 5, 2021.

Aura Project, Elko County, Nevada

The Aura project is located one hundred kilometers north of the city of Elko and twenty kilometers south of Mountain City. The project is located on public lands within the Mountain City Ranger District of the Humboldt-Toiyabe National Forest. Exploration activities are conducted under the terms of approved Plans of Operation effective through 2028 and 2029 for Doby George and Wood Gulch-Gravel Creek, respectively. The project consists of 709 unpatented lode mining claims totaling 12,848 acres and mineral leases on 2,296 acres of fee land in nine different parcels. The property is subject to several NSR royalties of between 1 and 2%.

Mineral Resource Estimate

In May 2021, the Company updated the mineral resource estimate for the Aura Project to incorporate exploration results from the 2020 drill campaign. In addition, resources were reported at an $1,800 gold price and were pit constrained at both Wood Gulch (Saddle and Southeast) and Doby George.

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WESTERN EXPLORATION, INC. (Formerly, Crystal Peak Minerals Inc.) MANAGEMENT’S DISCUSSION & ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2021

Estimated Indicated and Inferred Resources – Aura Project

INDICATED	Tonnes	Au(g/t)	Au(ozs)	Ag (g/t)	Ag (ozs)	Aueq (g/t)	Aueq(ozs)
Doby George1 Wood Gulch2 Gravel Creek3	12,922,000 2,079,000	0.98 3.72	407,000 249,000	59.6	3,986,000	0.98 4.58	407,000 305,943
Total	15,000,001	1.36	656,000	59.6	3,986,000	1.48	712,943
INFERRED	Tonnes	Au(g/t)	Au(ozs)	Ag (g/t)	Ag(ozs)	Aueq (g/t)	Aueq(ozs)
Doby George1 Wood Gulch Gravel Creek3	4,999,000 4,359,000 5,394,000	0.73 0.66 3.12	118,000 93,000 540,000	5.8 45.5	808,000 7,897,000	0.73 0.74 3.77	118,000 104,543 652,814
Total	14,752,000	1.58	751,000	27.8	8,705,000	1.84	875,347

• $1,800 Gold price, 70:1 Ag:Au ratio

• Pit Constrained 0.2 g/tAu cutoff oxide, 0.3 g/tAu cutoff for mixed. 1.4 g/tAu for unoxidized

2 Pit Constrained 0.3 g/tAueq cutoff

3 2.0 g/t Aueq cutoff

The Resource Estimate for the Aura Project was prepared by Derick Unger, CPG, Steven Ristorcelli, CPG, Peter Ronning, P.Eng. of Mine Development Associates (MDA) and Jack S. MacPartland, M.M.S.A. of McClelland Labs in accordance with NI 43-101. NI 43-101 of the Canadian Securities Administrators – Standards for Disclosure for Mineral Projects – requires that each category of mineral reserves and mineral resources be reported separately. Readers should refer to the Company’s continuous disclosure documents available at www.sedar.com for this detailed information, which is subject to the qualifications and notes therein.

In October 2021, the Company updated the Aura Project Technical Report to include up-to-date disclosure on various elements of the land status and property payments made during the period from the completion of the Technical Report in May, 2021 and the filing of Information Circular for the RTO on November 12, 2021. The mineral resources in this period did not change but the recommendations for Phase 1 and 2 explorations were amended to allow for additional surface work to be completed in Phase 1 based on the results from drilling completed at Gravel Creek in 2020. The current Technical Report is current and has an effective date of October 14, 2021.

The Technical Report recommended a 2 Phase exploration program for both Gravel Creek and Doby George. At the end of Phase 2, the Company will have completed a Pre-Feasibility level study for Doby George and a Preliminary Economic Assessment for the Gravel Creek deposit. The Phase 1 exploration program will commence in Q2 – 2022 and take approximately 9 months to complete at a cost approximately $2,800,000. The Phase 1 program is completely funded and once complete will lead to preparation for the Phase 2 program which would take an additional 12 to 24 months to complete at an additional cost of $16,200,000. At the end of Phase 1, drilling and metallurgical work completed at Doby George will lead to the preparation of studies to complete a Pre-Feasibility Study in 2023.

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WESTERN EXPLORATION, INC. (Formerly, Crystal Peak Minerals Inc.) MANAGEMENT’S DISCUSSION & ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2021

At Gravel Creek, Phase 1 will include additional surface geochemistry, geology, and geophysics to cover a 3 x 5-kilometer area around the entire Gravel Creek and Wood Gulch deposits. The company will commence the surface evaluation in Q2-2022 and has budgeted $330,000 for this work including $150,000 for IP geophysics and $20,000 for soil geochemistry. The completion of this field work will lead to a proposed program of diamond drilling for Phase 2. The Phase 2 program consists of 5,000 meters of RC drilling and 15,000 meters of diamond drilling costing approximately $10,000,000. The results of the drilling program and the surface exploration work would be used to complete a PEA study.

At Doby George approximately $1,500,000 of drilling is proposed in Phase 1. The drilling would be completed with large diameter core drilling to provide samples for additional metallurgical test work. The test work would focus on optimizing crush size and heap leach recoveries and kinetics, $250,000 is budgeted for the metallurgical test work. The completion of the metallurgical work would lead to the commencement of a pre-feasibility study , as outlined in Phase 2, that would cost approximately $1,000,000 and take one year to complete. An additional $1,200,000 is budgeted for Doby George in Phase 2 for reverse circulation drilling to expand the footprint of the mineralization.

There was no drilling or exploration completed in 2021 as the company was completing a full technical report of its previous activities and preparing for the RTO.

In 2020 the Company completed:

• a diamond drill program designed to test the extensions of the Gravel Creek deposit along strike and down dip. A total of 6,568 meters of core drilling was completed in eleven drill holes, WG444 to WG454.

• a program of soil geochemistry to extend the existing soil grid to the north by approximately six hundred meters. A total of 361 soil samples were collected on 200-meter spaced lines with one hundred meters between samples on lines.

• A scoping level metallurgical study of mineralization from the Gravel Creek mineral resource.

Between July 30 and November 8, 2020, the Company completed a diamond drill program focused on extensions of known controls to mineralization along strike to the NW and the SE (WG 446, 449, 451, 452 and 453), down dip of the main feeder zone (WG 444, 445, 447, 448 and 454) and in the overlying Miocene rhyolites in the hanging wall of the main feeder structure, (WG450).

Drilling confirms the Gravel Creek mineral resource alteration and mineralization continue along strike and down dip with modest step outs of 100 to 160 meters. Moreover, the drilling validates the presence and orientation of high-grade epithermal veins in the hanging wall of the mineral resource and within the main feeder structure.

The Company completed Scoping level metallurgical test work on the Gravel Creek deposit using drill core samples from drill core collected in the 2017 drilling program. The laboratory work was completed by McClelland Laboratories, Inc of Reno, NV. The test work was conducted on a total of nine drill core composites from the Gravel Creek project to evaluate response of the Gravel Creek gold and silver bearing sulfidic material types to conventional flotation treatment. The composites represented Schoonover rock unit material (4 composites) and Frost Creek rock unit material (5 composites) and included one master composite of each of the two types. Head assays conducted on each of the composites showed that they contained between 2.61 g/t and 18.41 g/t gold (8.33 g/t, avg.) and between 14.06 g/t and 236.94 g/t silver

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WESTERN EXPLORATION, INC. (Formerly, Crystal Peak Minerals Inc.) MANAGEMENT’S DISCUSSION & ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2021

(97.04 g/t, avg.). Test work was completed on nine composites made up of drill core samples from the Gravel Creek mineral deposit. The samples were from the Frost Creek host – 85% of the mineral resource and the Schoonover host – 15% of the mineral resource.

• A Bond ball mill work index test was conducted on the Frost Creek master composite. The work index was 16.82 kW-hr/st, which would be characterized as hard material. Sample limitations precluded comminution testing on the Schoonover master composite .

• Conventional rougher flotation tests of nine composites consisting of the various mineralization styles (at an 80%-200M feed size contained between +92.3% to 99.4% of the total gold.

• A locked-cycle flotation test series was conducted on the Frost Creek master composite (4568-009), at an 80%-200M feed size (with rougher concentrate regrind) to evaluate the effects of cleaner tailings recycle on concentrate grade and recovery. Available test results indicated that a flotation concentrate of 7.8% of the feed weight was produced at a grade of 3.67 oz Au/ton, 52.3 oz Ag/ton and 35.0% sulfide sulfur, and representing recoveries of greater than 95% gold, silver, and sulfide sulfur.

• Additional metallurgical testing is planned to improve and optimize a revised understanding for metallurgical recoveries as we move forward with the Gravel Creek project (H2 2021)

Summary Gold and Silver Results, Rougher Flotation, Gravel Creek Composites, 80%-200M Feed Size

Weight, % Composite Conc. Tail Schoonover 4568-001 15.1 84.9 4568-002 8.1 91.9 4568-0031) 12.1 88.0 4568-0042) 14.1 85.9 Frost Creek 4568-005 11.4 88.6 4568-006 10.1 89.9 4568-007 10.5 89.5 4568-008 14.6 85.4	Gold Grade g/t Gold Distribution % Conc. Tail Calc’d Head Conc. Tail 15.91 0.12 2.54 94.3 5.7 26.61 0.07 2.26 95.8 4.2 56.13 1.41 8.50 79.00 21.0 28.77 0.27 4.39 92.3 7.7 82.59 0.17 9.63 97.8 2.2 26.61 0.05 2.74 97.8 2.2 79.71 0.27 8.71 96.1 3.9 130.01 0.10 19.10 99.4 0.6	Silver Grade g/t Silver Distribution % Conc. Tail Calc’d Head Conc. Tail 351.09 5.49 57.60 91.9 8.1 670.98 5.14 58.97 92.0 8.0 550.29 5.83 71.31 93.0 7.0 345.26 7.54 55.20 88.2 11.8 1,920.02 11.66 229.37 95.5 4.5 141.94 0.34 14.74 97.9 2.1 489.95 2.06 53.14 96.5 3.5 514.98 2.06 76.80 97.7 2.3 1,088.24 7.54 154.63 96.0 4.0
4568-0093) 14.4 85.6	77.97 0.36 10.97 96.00 4.0

• 1) Average of 2 tests.

• 2) Master composite, average of 3 tests.

• 3) Master composite, average of 2 tests.

In addition, cyanide shake analysis results showed that the average cyanide soluble to assayed (CN/FA) gold content averaged 23.7% for the Schoonover composites and 58.6% for the five Frost Creek composites. These comparative results indicate that the Schoonover type material is refractory to cyanidation treatment, and that the Frost Creek material may be more amenable to cyanidation. The Schoonover and Frost Creek master composites contained 3.72% and 3.07% sulfide sulfur, respectively. Neither composite contained significant quantities of organic carbon. Arsenic head grades for the

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WESTERN EXPLORATION, INC. (Formerly, Crystal Peak Minerals Inc.) MANAGEMENT’S DISCUSSION & ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2021

respective composites were 0.23% and 0.40%. Preliminary mineralogical characterization conducted on the master composites showed that the primary sulfide minerals contained pyrite (~ 8.0%), with lesser amounts of arsenopyrite (0.77% - 1.57%) and trace levels of pyrrhotite, chalcopyrite, sulfosalts, and other sulfides.

Future metallurgical test work will focus on continued optimization of float concentration and test work focused on detailed mineralogy, including gold and silver deportment studies, Rougher optimization testing, to confirm indicated grind sensitivity and further optimize reagent suites, Cleaner flotation testing, to optimize production of a high grade, high recovery final concentrate, Testing to evaluate regrind/cyanide leaching of flotation concentrate generated from the various ore types and ore variability testing – including evaluation of flotation and if appropriate, regrind/cyanide leaching of flotation concentrate.

RESULTS OF OPERATIONS

For the year ended December 31, 2021 and 2020

The net loss for the year ended December 31, 2021 was $1,856,952 compared to $7,220,373 for the prior year’s comparative period. The net loss in the year ended December 31, 2021 was less than the comparable period in 2020 due to lack of field exploration in 2021. Expenses for the year ended December 31, 2021 amounted to $1,942,403 compared to $7,283,254 for the comparative period of 2020.

On October 5, 2021, Western LLC entered into a Purchase and Sale Agreement with Marigold for the sale of a retained resource discovery payment and a royalty on property sold to Marigold. The sale resulted in the Company receiving cash in the amount of $1,650,000.

Exploration expenditures for the year ended December 31, 2021 were $845,546 compared to $5,435,573 in the comparable period of 2020. Exploration expenses for 2020 were for land expenses, geologic consulting and some limited assaying of drill core that was carried over from 2020. The increased expenditures in the year ended December 31, 2020 were due to drilling activities commencing in late July and continuing into early November, 2020.

G&A expenses in the year ended on December 31, 2021 were $1,096,857 compared to $1,847,681 in the comparable period of 2020. The difference was largely attributable to a decrease in consulting fees and legal and regulatory fees in fiscal 2021 versus fiscal 2020.

Write-off of minerals properties amounted to $Nil for both 2021 and 2020.

The operating losses are a reflection of the Company’s status as a non-revenue producing mineral exploration company. As the Company has no main source of income, losses are expected to continue for the foreseeable future.

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WESTERN EXPLORATION, INC. (Formerly, Crystal Peak Minerals Inc.) MANAGEMENT’S DISCUSSION & ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2021

Summary of Quarterly Results

The following table summarizes information derived from the Company's financial statements for each of the eight most recently completed quarters.

Year:	Year:	2021	2021	2021	2021	2020	2020	2020	2020
Quarter Ended:		31-Dec	30-Sept	30-Jun	31 Mar	31-Dec	30-Sept	30-Jun	31-Mar
Net income (loss):		$(1,624,807)	$1,301,107	$(929,279)	$(603,973)	$(2,242,927)	$(3,645,103)	$(925,660)	$(406,683)
(i)	in total (000s)	$(1,624)	$1,301	$(929)	$(604)	$(2,243)	$(3,645)	$(926)	$(407)
(ii)	per shares	$(0.06)	$0.04	$(0.03)	$(0.02)	$(0.08)	$(0.12)	$(0.03)	$(0.01)

Notes :

(1) Based on weighted average number of shares outstanding at December 31, 2021

In the view of management, the variations in financial results that occur from quarter to quarter are not useful in analyzing the Company’s performance. It is in the nature of the business of junior exploration companies that unless they sell a mineral interest for a sum greater than the costs incurred in acquiring such interest, they have no significant net sales or total revenue.

Significant variances in the Company’s reported loss from quarter to quarter most commonly arise from several factors that are difficult to anticipate in advance or to predict from past results. These factors include: (i) level of exploration and project evaluations expenses incurred, (ii) decisions to write off acquisition costs when management concludes there has been an impairment in the carrying value of a mineral property, or the property is abandoned, and (iii) the vesting of incentive stock options, which results in the recording of amounts for share-based compensation expense that can be quite large in relation to other general and administrative expenses incurred in any given quarter.

Selected Annual Information

Selected Annual Information	Selected Annual Information
Year Ended December 31		2021	2020	2019
Net sales or total revenue		$Nil	$Nil	$Nil
Net income(Ioss):		$(1,856,952)	$(7,220,373)	$(1,636,649)
(i)	in total(000s)	$(1,857)	$(7,220)	$(1,637)
(ii)	pershare	$(0.06)	$(0.27)	$(0.06)
Total Assets(000’s)		$14,133	$9,862	$9,001
Total Long-Term Liabilities(000’s)		$(784)	$(402)	$(359)

Notes :

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WESTERN EXPLORATION, INC. (Formerly, Crystal Peak Minerals Inc.) MANAGEMENT’S DISCUSSION & ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2021

• (1) Per share amounts are calculated using the weighted average number of shares outstanding as at December 31, 2021.

Financing Activities

On October 13, 2021, the Company completed a concurrent financing, issuing a total of 2,248,936 subscription receipts each at a price of CAD$2.65 for aggregate proceeds of CAD$5,959,680 ($4,611,684). On closing of the RTO, each subscription receipt converted into one common share and one common share purchase warrant exercisable into one additional common share at a price of CAD$3.975 up until October 13, 2023. The Company incurred cash broker fees and legal fees of $423,508 in relation to the financing. Proceeds were allocated to common shares and warrants using the relative fair value method. The fair value of the warrants were determined to be $975,801 on the date of issuance, estimated using the Black Scholes pricing model using a fair value share price of CAD$2.03, risk free interest rate of 0.96%, an expected dividend yield of 0%, volatility rate of 94% based on historical share prices of comparable companies and an expected life of 1.81 years.

In addition to the cash broker fees and legal fees paid, the Company also issued a total of 89,957 broker warrants, each exercisable into a common share of the Company at a price of CAD$3.05 for a period of one year from the closing date of the RTO. The fair value of the broker warrants were determined to be CAD$27,185 on the date of issuance, estimated using the Black Scholes pricing model using a fair value share price of CAD$2.03, risk free interest rate of 0.96%, an expected dividend yield of 0%, volatility rate of 81% based on historical share prices of comparable companies and an expected life of 1 year.

Concurrent with the RTO transaction, on December 22, 2021 the Company entered into an agreement with Agnico to repurchase 2,358,490 post RTO common shares in exchange for a 1% net smelter royalty on the Aura project deemed to hold a fair value of $nil (note 7) and 748,668 warrants (the “Redemption Agreement”). Under the terms of the warrants, each warrant shall entitle the holder to purchase one common share of the Company at a price of $2.67 up until May 15, 2023.

On closing of the Redemption Agreement, amounts totaling $3,573,306, equal to the average cost of shares repurchased were charged to share capital, with amounts totaling $3,300,660 in excess of the fair value of consideration paid totaling $272,646 recognized directly as a charge to retained earnings.

The fair value of the warrants were determined to be $272,646 on the date of issuance, estimated using the Black Scholes pricing model. As the exercise price of the warrants are denominated in a currency other than the Company’s function currency and therefore do not meet the fixed for fixed criteria, they have been classified as a derivative financial instrument held at FVTPL and included as a warrant liability on the consolidated statement of financial position. As at December 31, 2021, the warrant liability was revalued at $276,110 resulting in a loss on fair value of warrant liability totaling $3,464 recognized in the consolidated statement of loss and comprehensive loss.

The inputs utilized in the Black Scholes pricing model on the date of issuance and on revaluation were as follows: fair value share price of $1.57 - $1.60, risk free interest rate of 0.95% - 0.96%, an expected dividend yield of 0%, volatility rate of 84% based on historical share prices of comparable companies and an expected life of 1.37 - 1.4 years.

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WESTERN EXPLORATION, INC. (Formerly, Crystal Peak Minerals Inc.) MANAGEMENT’S DISCUSSION & ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2021

In May 2020, Agnico Eagle (USA) Limited (Agnico), entered into an agreement with the Company to subscribe to a total of 3,011 Class A Units for gross proceeds of $9 million. The investment is to be made in three tranches as follows:

• 1) First Tranche - $3 million through the issuance of 1,096 Class A units

• 2) Second Tranche - $3 million through the issuance of 1,096 Class A units

• 3) Third Tranche - $3 million through the issuance of 819 Class A units

As part of the agreement, the Company must use the proceeds raised as follows:

• 1) First Tranche – A minimum of $2.6 million is to be used on exploration expenses at the Gravel Creek Property

• 2) Second Tranche – A minimum of $2.7 million is to be used on exploration expenses at the Gravel Creek Property

• 3) Third Tranche – A minimum of $2.7 million is to be used on exploration expenses at the Gravel Creek Property

The first tranche was completed on May 15, 2020 and the second tranche was completed on September 2, 2020 resulting in the issuance of 2,192 Class A Units of the Company.

On June 9, 2020, the Company issued 111 Class A units for total cash proceeds of $302,000.

On July 25, 2020, the Company issued units to certain Board and Management members to extinguish outstanding debt. The Company issued 67 Class A units to Mr. Marud, CEO in settlement of $125,700 of advances to the Company (see note 11) and $56,250 in deferred compensation held as due to related party. In addition, 150 Class A units were issued to Coral Reef LLC in settlement of amounts totaling $411,057 held in due to related party.

On August 4, 2020, the Company issued 38 Class A units for total cash proceeds of $105,000.

On October 9, 2020, Agnico and Western entered into an Amended Subscription Agreement whereby the Third Tranche was split into an Initial Third Tranche of US$1 million and a Final Third Tranche of $2 million. The Initial Third Tranche was due on or before October 26, 2020 and the Final Third Tranche is executable within 20 days of the assay results from Phase 2 being received. Agnico executed the Initial Third Tranche on October 23, 2020 and as a result 273 Class A shares were issued. As of December 31, 2020 assays from Tranche 2 drilling were still outstanding and Agnico has not been notified of their 20day notice for the Final Third Tranche. On December 17, 2021, Agnico converted their $2M remaining options into 748,668 warrants of Western with a strike price of $2.67.

Investing Activities

Investing activities for the year ending December 31, 2021 was $43,116. At the close of the RTO, $64,450 in cash was received from banks accounts held by CPM and this was partially offset by the purchase of field related equipment at the Aura project. For the Year ended December 31, 2020 the investing activities of $(33,209) were for acquisition of field equipment and supplies.

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WESTERN EXPLORATION, INC. (Formerly, Crystal Peak Minerals Inc.) MANAGEMENT’S DISCUSSION & ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2021

Off Balance Sheet Arrangements

The Company does not have any off-balance sheet arrangements.

Transactions with Related Parties

A corporation controlled by Marceau Schlumberger, an officer of the Company, was paid or accrued consulting fees of $nil for the year ended December 31, 2021 (year ended December 31, 2020 - $488,660).

On December 22, 2021, $859,156 of the $1,299,251 due to a corporation controlled by Marceau Schlumberger was converted to common shares as part of the RTO. As at December 31, 2021 amount due was $440,095 (December 31, 2020 - $1,299,251).

On June 9, 2021, the Company entered into a series of Promissory Notes totaling $275,000 with certain Officers and Directors of the Company. Under the terms of the Notes, the Company promises to pay to the order of the noteholder or its registered assigns, the principal amount or such lesser amount as shall equal the outstanding principal amount hereof, together with simple interest from the date of the Promissory Note (the "Note") on the unpaid principal balance at a rate equal to 15% per annum, computed on the basis of the actual number of days elapsed and a year of 365 days. All unpaid principal, together with any then accrued but unpaid interest and any other amounts payable hereunder, shall be due and payable on the earliest to occur of (i) fifteen days following the demand of Holder, which demand may not be made earlier than June 9, 2022 , (ii) the occurrence of an Event of Default, or (iii) such other time as expressly provided for in the Note.

On December 22, 2021, the promissory notes and accrued interest was $296,134, which was converted to common shares as part of the RTO. During the year ended December 31, 2021 interest expense was $21,134 (December 31, 2020 - $nil).

During the 2020 fiscal year, the Company issued 217 Class A Units to related parties in settlement of amounts due to related parties totaling of $593,007.

Key Management Personnel

Key management personnel include those persons having authority and responsibility for planning, directing, and controlling the activities of the Company as a whole. The Company has determined that key management personnel consist of executive and non-executive members of the Company’s Board of Directors and corporate officers, including the Company’s Chief Executive Officer and Chief Financial Officer.

The Company entered the following transactions with related parties and key management personnel during the year completed to December 31, 2021.

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WESTERN EXPLORATION, INC. (Formerly, Crystal Peak Minerals Inc.) MANAGEMENT’S DISCUSSION & ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2021

	Year Ended December 31, 2021	Year Ended December 31, 2020
Salaries and fees(i)	$150,000	$268,750
Director’s fees(ii)	$18,750	$25,000

Notes :

• (1) As at December 31, 2021, $6,251 (December 31, 2020 - $6,250) was due to officers of the Company and this amount was included in accounts payable and accrued liabilities.

• (2) As of December 31, 2021, directors were owed $18,750 (December 31, 2020, $6,250) and this amount was included in accounts payable and accrued liabilities.

LIQUIDITY AND CAPITAL RESOURCES

Western has no operations that generate cash flows and the Company's future financial success will depend on the discovery of one or more economic mineral deposits. This process can take many years, can consume significant resources, and is largely based on factors that are beyond the control of the Company’s management.

For the foreseeable future, Western will rely upon its ability to raise financing through the sale of equity. This is dependent on positive investor sentiment, which in turn is influenced by a positive climate for precious metal exploration generally, a company's track record and the experience and caliber of a company's management.

There is no assurance that Western will be able to access equity funding at the times and in the amounts required to fund the Company's activities. The outlook for the world economy remains uncertain and vulnerable to various events that could adversely affect the Company’s ability to raise additional funds going forward.

Cash and Financial Condition

The Company’s capital is the members’ equity balance. The Company’s objectives in managing its capital are to maintain the ability to continue as a going concern and to continue to explore the Company’s mineral properties for the benefit of its shareholders. To effectively manage the Company’s capital requirements, the Company has a planning and budgeting process in place setting out the expenditures required to meet its strategic goals. The Company compares actual expenses to budget on all exploration projects and overhead to manage costs, commitments, and exploration activities. As the Company is in the exploration stage, its operations have been substantially funded by the issuance of member units and mineral property earn-in agreements. The Company is not subject to any externally imposed credit or capital requirements. However, the Company will continue to rely on such funding depending upon

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WESTERN EXPLORATION, INC. (Formerly, Crystal Peak Minerals Inc.) MANAGEMENT’S DISCUSSION & ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2021

market and economic conditions at the time. There have been no changes in the Company’s approach to capital management during the year ended December 31, 2021.

Financial Instruments

The Company's financial instruments currently consist of cash and restricted cash which are classified as financial assets measured at amortized cost, accounts payable and accrued liabilities, and due to related parties, which are classified as financial liabilities measured at amortized cost. The carrying values of the Company’s financial instruments approximate fair values due to their short-term nature.

The Company’s financial instruments are exposed to certain financial risks including interest rate risk, liquidity risk and credit risk. The Company’s exposure to these risks and its methods of managing the risks are summarized as follows:

• i. Interest Rate Risk

• Interest rate risk is the risk that future cash flows will fluctuate because of changes in market interest rates. The Company is not exposed to material interest rate risk.

• ii. Liquidity Risk Liquidity risk is the risk that the Company will be unable to meet financial obligations as they fall due. The Company’s approach to managing liquidity risk to provide reasonable assurance that it will have sufficient funds to meet liabilities when due by forecasting cash flows for operations, anticipated investing, and financing activities and through management of its capital structure. As of December 31, 2021 and December 31, 2020, all the Company’s financial liabilities are either due immediately or have contractual maturities of less than 90 days.

• iii. Credit Risk

• Credit risk is the risk that a counterparty to a financial instrument will fail to discharge its contractual obligations. The Company is mainly exposed to credit risk with respect to managing its cash and restricted cash. The Company’s risk management policies require that significant cash deposits are held with U.S. FDIC insured banks. All investments must be less than one year in duration.

RISK FACTORS

As a company active in the mineral resource exploration and development industry, the Company is exposed to a number of risks.

Exploration Stage Operations

The Company’s operations are subject to all the risks normally incident to the exploration for and the development and operation of mineral properties. The Company has implemented comprehensive safety and environmental measures designed to comply with government regulations and ensure safe, reliable, and efficient operations in all phases of its operations. The Company maintains liability and property insurance, where reasonably available, in such amounts it considers prudent. The Company may become subject to liability for hazards against which it cannot insure or which it may elect not to insure against because of high premium costs or other reasons.

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WESTERN EXPLORATION, INC. (Formerly, Crystal Peak Minerals Inc.) MANAGEMENT’S DISCUSSION & ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2021

All the Company’s properties are still in the exploration stage. Mineral exploration involves a high degree of risk, which even a combination of experience, knowledge and careful evaluation may not be able to avoid. Few properties that are explored are ultimately developed into producing mines.

Unusual or unexpected formations, fires, power outages, labor disruptions, flooding, explosions, landslides, and the inability to obtain adequate machinery, equipment or labor are some of the risks involved in mineral exploration activities. Substantial expenditures are required to establish mineral reserves and resources through drilling, to develop metallurgical processes to extract the metal from the material processed and to develop the mining and processing facilities and infrastructure at any site chosen for mining.

There is no assurance that commercial quantities of ore will be discovered. Even if commercial quantities of ore are discovered, there is no assurance that the properties will be brought into commercial production or that the funds required to mine mineral reserves and resources discovered by the Company will be obtained on a timely basis or at all. The commercial viability of a mineral deposit once discovered is also dependent on a number of factors, some of which are the particular attributes of the deposit, such as size, grade, and proximity to infrastructure, as well as metal prices. Most of the above factors are beyond the control of the Company. In the event that commercial viability is never attained, the Company may seek to transfer its property interests or otherwise realize value or may even be required to abandon its business and fail as a “going concern.”

COVID-19 global pandemic

During the 2020 fiscal year, there was a global outbreak of COVID-19 ("Coronavirus"), which has had a significant impact on businesses through the restrictions put in place by the Canadian and U.S. governments regarding travel, business operations and isolation/quarantine orders. At this time, it is unknown the extent of the impact the Coronavirus outbreak may have on the Company as this will depend on future developments that are highly uncertain and that cannot be predicted with confidence. These uncertainties arise from the inability to predict the ultimate geographic spread of the disease, and the duration of the outbreak, including the duration of travel restrictions, business closures or disruptions, and quarantine/isolation measures that are currently, or may be put, in place by the U.S. government or local state authorities, and other countries to fight the virus. While the extent of the impact is unknown, the Company has employed new standards of operation and safety at its field sites. The Company formally adopted the Association of Mineral Exploration in British Columbia’s “COVID-19 Exploration Fieldwork Safety Guidelines”. The guidelines define best practices for preventing and controlling the spread of COVID-19 in a remote exploration environment. Western Exploration LLC requires all contractors and employees to self-monitor their health at all times and not report to work if they have any associated symptoms. In addition, the Company monitors and records all employees’ temperatures daily, has a one person to room policy, completes sanitization of all work and living areas regularly, limits office and works space to employees only. There has been no impact on operations as a result of COVID-19

Competition

The mining industry is intensely competitive in all of its phases and the Company competes with other companies with greater technical and financing resources than itself with respect to acquiring properties of merit, the recruitment and retention of qualified employees and other persons to carry out its mineral

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WESTERN EXPLORATION, INC. (Formerly, Crystal Peak Minerals Inc.) MANAGEMENT’S DISCUSSION & ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2021

exploration activities. Competition in the mining industry could adversely affect the Company’s prospects for mineral exploration in the future.

Financial Markets

The Company is dependent on the equity markets as its principal source of operating working capital and the Company’s ability to attract investment is largely determined by the strength of the junior resource markets and by the status of the Company’s projects in relation to these markets and its ability to compete for investor support of its projects.

Environmental and Government Regulation

Exploration activities are subject to various laws and regulations relating to the protection of the environment, historical and/or archaeological sites and endangered or protected species of plants and animals. Although the exploration activities of the Company are currently carried out in accordance with all applicable rules and regulations, no assurance can be given that new rules and regulations will not be enacted or that existing rules and regulations will not be applied in a manner which could limit or curtail production or development. Amendments to current laws and regulations governing the operations and activities of the Company or more stringent implementation thereof could have a substantial adverse impact on the Company.

Title to Properties

While the Company has investigated title to all of the properties for which it holds concessions or other mineral leases or licenses or in respect of which it has a right to earn an interest, the Company cannot guarantee that title to such properties will not be challenged or impugned. The Company can never be certain that it will have valid title to its mineral properties. The Company does not carry title insurance on its properties. A successful claim that the Company does not have title to a property could cause the Company to lose its rights to that property, perhaps without compensation for its prior expenditures relating to the property.

Government actions

The Company’s exploration activities require permits from various governmental agencies charged with administering laws and regulations governing exploration, labor standards, occupational health and safety, control of toxic substances, waste disposal, land use, environmental protection, and other matters. Failure to comply with laws, regulations and permit conditions could result in fines and/or stop work orders, costs for conducting remedial actions and other expenses. In addition, legislated changes to existing laws and regulations could result in significant additional costs to comply with the revised terms and could also result in delays in executing planned programs pending compliance with those terms.

There is no assurance that the government of any jurisdiction in which the Company holds properties will not change environmental regulations or taxation policies in a manner that would adversely affect the economic viability of those properties.

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WESTERN EXPLORATION, INC. (Formerly, Crystal Peak Minerals Inc.) MANAGEMENT’S DISCUSSION & ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2021

OUTSTANDING SECURITIES DATA

Prior to closing of the RTO on December 22, 2021, the Company’s authorized capital consisted of membership interests represented by units consisting of four class: “Class A”, “Class A-1”, “Class B” and “Common units”. Class A, Class-1 and Class B units entitled the holders to share in the income, gains, losses, deductions, credits, or similar items of distribution. Class A and Class A-1 membership interests have a distribution priority equal to a cumulative 6% annual return, compounded annually on any unreturned capital contributions.

Upon closing of the RTO, the Company’s authorized capital consisted solely of voting common shares without par value. At December 31, 2021 there was 30,435,126 common shares issued and outstanding.

During the year ended December 31, 2021 and 2020, the Company issued the following units, shares, and warrants:

g the year ended December 31, arrants:	2021 and 2020, the Company issued the following units, shares,
	Number of units/shares
	Class A Class A-1 Class B Common Shares
Balance - January 1, 2020	14,804 993 1,560 -
Issued	2,830 - - -
Balance - December 31, 2020	17,634 993 1,560 -
Conversion as a result of RTO Shares issued on RTO Units issued for cash Shares issued in settlement of debt Share redemption	(17,634) (993) (1,560) 29,509,468 490,566 2,248,936 544,646 - - - (2,358,490)
Balance - December 31, 2021	- - - 30,435,126

Total Warrants	Strike Price	Grant Date	Expiration Date
2,248,936	CAD$3.975	12/22/2021	10/13/2023
89,957	CAD$3.05	12/22/2021	12/22/2022
748,668	$2.67	12/22/2021	5/15/2023
3,087,561

OUTLOOK

The Company continues to evaluate and discuss with other parties’ potential gold and silver projects for possible acquisition, potential transactions, and corporate opportunities to add to its current portfolio of properties. In addition, the company is reviewing the results from past projects to determine how best to advance and explore its properties.

SUBSEQUENT EVENTS

On January 27, 2022, the Company settled an outstanding debt of CAD$448,394 to a legal advisor by issuing 169,205 units, each comprised of one common share and one common share purchase warrant exercisable into one additional common share at a price of CAD $3.975 for a period of 24 months from the date of issuance.

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WESTERN EXPLORATION, INC. (Formerly, Crystal Peak Minerals Inc.) MANAGEMENT’S DISCUSSION & ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2021

FORWARD-LOOKING INFORMATION

Certain of the statements made and information contained herein is “forward-looking information” within the meaning of the British Columbia Securities Act. This includes statements concerning the Company’s plans at its mineral properties, which involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking information. Forward-looking information is subject to a variety of risks and uncertainties which could cause actual events or results to differ from those reflected in the forward - looking information, including, without limitation, the ability of the Company to continue to be able to access the capital markets for the funding necessary to acquire and maintain exploration properties and to carry out its desired exploration programs; competition within the minerals industry to acquire properties of merit, and competition from other companies possessing greater technical and financial resources; difficulties in executing exploration programs on the Company’s proposed schedules and within its cost estimates, whether due to weather conditions in the areas where it operates, increasingly stringent environmental regulations and other permitting restrictions, or other factors related to exploring of its properties, such as the availability of essential supplies and services; factors beyond the capacity of the Company to anticipate and control, such as the marketability of mineral products produced from the Company’s properties, government regulations relating to health, safety and the environment, and the scale and scope of royalties and taxes on production; the availability of experienced contractors and professional staff to perform work in a competitive environment and the resulting adverse impact on costs and performance and other risks and uncertainties, including those described in each management’s discussion and analysis of financial condition and results of operations. In addition, forward-looking information is based on various assumptions including, without limitation, assumptions associated with exploration results and costs and the availability of materials and skilled labor. Should one or more of these risks and uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in forward-looking statements. Accordingly, readers are advised not to place undue reliance on forward-looking information. Except as required under applicable securities legislation, the Company undertakes no obligation to publicly update or revise forward-looking information, whether as a result of new information, future events or otherwise.

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