Wildsky Resources Inc. — Management Reports 2023

Feb 27, 2023

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WILDSKY RESOURCES INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS

For the Year Ended

November 30, 2022

WILDSKY RESOURCES INC. Management’s Discussion and Analysis For The Year Ended November 30, 2022

GENERAL

Wildsky Resources Inc. (“Wildsky” or the “Company”) was incorporated in January 2006 under the laws of British Columbia, Canada. The Company’s registered office is Suite 410 – 938 Howe Street, Vancouver, British Columbia, Canada. Wildsky is listed on the TSX Venture Exchange under the trading symbol “WSK”. The Company and its subsidiaries are in the business of acquisition, exploration and development of mineral properties.

This Management’s Discussion and Analysis (“MD&A”) of the Company has been prepared based on available information up to the date of this report, February 27, 2023, and should be read in conjunction with the Company’s audited consolidated financial statements and related notes for the year ended November 30, 2022, which have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“ISAB”). All monetary amounts are expressed in Canadian dollars unless stated otherwise.

The Company’s shares are listed on the TSX Venture Exchange under the symbol “WSK”. Additional information is available on SEDAR at www.sedar.com.

FORWARD-LOOKING STATEMENTS

Information and statements contained in this MD&A that are not historical facts are forward-looking information within the meaning of National Instrument 51-102 Continuous Disclosure Obligations of the Canadian Securities Administrators that involve risks and uncertainties.

This MD&A contains forward-looking statements, such as estimates and statements regarding the Company’s goals and future plans, including words to the effect that the Company expects a stated result or event to occur. These forward-looking statements are subject to known or unknown risks and uncertainties, which could cause actual results or performance of the Company to differ materially from results implied by such forward-looking information. Factors that could cause the actual results to differ include commodity price fluctuations, market capital access, global economy and politics, government regulations, environmental restrictions, exploration results, mineral title disputes, limitation on insurance coverage and availability of consultants delivering timely services, as well as those factors discussed in the section entitled “Risks and Uncertainties” in this MD&A.

Although the Company has attempted to identify important factors that could affect the Company or may cause actual actions, events or results to differ, there may be other causing factors out of the Company’s anticipation or estimation. Forward-looking statements contained herein are made as of the date of this MD&A and the Company disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or results otherwise. Accordingly, readers are advised not to place undue reliance on forward-looking statements.

OVERVIEW

Private placement

On September 27, 2022, the Company closed a non-brokered private placement by issuing 13,333,332 shares at $0.15 per share for total proceeds of $2,000,000.

Convertible debentures

In April 2022, the Company issued 2,000,000 shares pursuant to the convertible debts issued in April 2020. The Company repaid interest of $20,000 at the maturity date.

Acquisition of mineral exploration licenses in Ethiopia

On July 8, 2021, the Company was issued Exploration License #00570, which convers an area about 395.64 km², located in Tigray National Regional State, Central Zone, Enticho Woreda, Ethiopia. The Tsorena Property focuses on gold and base metal exploration.

The Company paid $66,475 (US$52,905) for license application, data and document purchase.

- Acquisition of niobium tantalum and gold exploration licenses in Nigeria

In December 2020, the Company received TSX-V’s approval on the acquisition of exploration license in Nigeria.

On December 3, 2019, the Company entered into a Share Purchase Agreement (the Agreement) with 1187395 BC Limited. (the “Vendor”).

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WILDSKY RESOURCES INC. Management’s Discussion and Analysis For The Year Ended November 30, 2022

The Vendor, a British Columbia corporation wholly-owned by Mr. Chaoyi Wang, legally and beneficially owns 9,900,000 common shares (the “Shares”) of the 10,000,000 issued and outstanding common shares in the capital of Zijin Midas Nigeria Limited (“ZMNL”). Pursuant to the terms of the Agreement, the Company purchased the Shares from the Vendor for cash consideration of US$96,000.

ZMNL originally held ten Exploration Licenses (the “EL’s”) in Nigeria, three of the EL’s pertain to niobium-tantalum (“Nb-Ta”) exploration (each being a “Nb-Ta EL”), and the remaining seven EL’s are for gold and lead-zinc exploration (each being a “Au-Pb EL”). The ten EL’s cover a total area of 742 km².

Due to the security risk of entering Northern region of Nigeria for exploration work and the Company’s focus on Nb-Ta exploration, the Company decided not to renew the seven Au-Pb ELs when it came due in October 2021. As a result, the Company wrote off $51,354 of acquisition costs and license maintenance fees related to the seven Au-Pb ELs as of November 30, 2021. All the Company’s past exploration work was done on its Nb-Ta properties, the write-off of the seven Au-Pb Els does not impact the Company’s major assets.

MINERAL PROPERTY UPDATE

Geology and Mineralization in Nigeria

Nigeria is situated within the Pan-African Mobile Belt and sandwiched between the West African Craton to the west and the Saharan Metacraton to the north and to the southeast. The geology of Nigeria was divided into three major petrological components – Precambrian Basement Complex (≥ 600 Ma), Jurassic Younger Granites (ca. 150 Ma), and Cretaceous to Recent Sedimentary Basins (≤ 145 Ma). The Precambrian Basement Complex can be further subdivided into three lithologic groups, including the migmatite gneiss complex, the schist belts and the Older Granites. The Old Granites as the main intrusive rocks in the Basement Complex are distributed all over the country, especially in the north and in the west; the Jurassic Younger Granites occur within a nearly N-S trending narrow belt in central Nigeria and extend northwards into Niger.

The four major metallogenic provinces in Nigeria are composed of Sn-Ta-Nb Pegmatite Belt of Late Pan-African age, Sn-Nb-Ta Younger Granites of Jurassic age, Pb-Zn Benue Trough of Cretaceous age, and Au Schist Belts of Precambrian ages. The Au Schist Belts and Sn-Ta-Nb Pegmatite Belt fall within the Complex Basement, and the mineral resource associated includes gold, silver, cassiterite, tantalite, columbite, banded iron formation, sillimanite, and gemstones. The province of Younger Granites is notable for its Sn-Nb-Ta mineralization, with other ore minerals of REE minerals, wolframite and accessory minerals of uraninite, thorite, and pyrochlore. In the Benue Trough of the Sedimentary Basins, N-S trending veins with galena, sphalerite, and sometimes chalcopyrite occur mostly at the crest of anticlines, where pockets of uranium occurrences have also been discovered.

Covering the central area of the Properties, the Kenyang Intrusive Complex regionally belongs to the Afu Complex, which is the southernmost occurrences of the Jurassic Younger Granites. The Kenyang Intrusive Complex consists of multiphase granites, including an early-phase pink coarse-grained K-feldspar biotite granite and a late-phase grey fine-grained biotite granite. The Nb-Ta mineralization occurs along the contact zone of two-phase intrusions and mainly exists in the endocontact of the late fine-grained granite with pervasive albitization.

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WILDSKY RESOURCES INC. Management’s Discussion and Analysis For The Year Ended November 30, 2022

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Wildsky’s 3 exploration licenses in Nigeria

At the end of 2021, the Company held 3 exploration licenses (Nasarawa Nb-Ta property) in Nigeria, the total license area covered 474 square kilometers, located on the central Nb-Ta mineralization belt in the middle of the country.

Nasarawa Nb-Ta project

The Nasarawa Nb-Ta Project is located in Nasarawa State in central Nigeria, approximately 88 km southeast of Abuja, the capital city of Nigeria, and about 65 km west of the state capital Lafia. It is covered by three mineral claims, including EL 29624 (the Erigo Property), EL 29625 (the Udegi Property), and EL 29626 (the Akewa Property), with a total area of 47,400 hectares.

The Nasarawa Nb-Ta Project is located at the southern end of the Jurassic Younger Granites Lithological Province, which distinctively carries the Sn-Nb-Ta mineralization. The adjacent Kenyang Mine is only 7.5km away from Nasarawa property, Kengyang represents a typical LCT-granite-hosting Nb-Ta deposit, where primary Nb-Ta mineralization, characterized by disseminated columbite and tantalite, occurs in the endocontact of the roof zone of Jurassic fine-grained biotite granite along with pervasive albitization.

Wildsky completed a series of exploration activities in the second half of 2019 within the Nb-Ta Project area. The assay results from surface geochemical samples show that there is a strong positive correlation between Nb and radioactive elements U and Th. While columbite is a generally non-radioactive mineral, it always coexists with uraninite, thorite, monazite, and other U- or Th-bearing radioactive minerals. Accordingly, these radioactive minerals can serve as good vectors for the occurrence of associated Nb-Ta mineralization.

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WILDSKY RESOURCES INC. Management’s Discussion and Analysis For The Year Ended November 30, 2022

The geophysical surveys defined the contour of the contact between the late fine-grained granite and the early coarse-grained granite. Most of the geochemical samples with Nb over 100 ppm fall in the NEE-trending late fine-grained granite, and a few in the early coarse-grained granite stay close to the contact zone, which indicates that the Nb-Ta mineralization is controlled by the contact zones of two granitic intrusions, similar as what is observed in Kenyang Mine. Indicated the Nb-Ta Project presents great potential for the discovery of primary Nb-Ta mineralization, and so has sufficient merits to warrant further exploration and evaluation.

Exploration update

the Company launched its exploration program in Nigeria on 3 Niobium-Tantalum exploration licences at the end of February after the COVID-19 restrictions were lifted.

Mapping, prospecting, and geochemical surveys have been conducted at the South-East part of License EL 29626, where the regional Niobium-Tantalum mineralization trend passes.

The outcrop or soil sampling was done at 50 metre spacings along grid lines spaced 200 meters apart. The lines were oriented at 330°. One Portable Olympus Vanta VCR Geochemical Analyzer(XRF) was purchased in Vancouver and shipped to Nigeria to support this exploration program. The exploration team was divided into two groups, with one group using the XRF to analyze the sample in the field, and the other collecting samples and taking them to the camp for analyzing purposes. The XRF’s detection limit is 5-7 ppm for both Niobium and Tantalum, and 4ppm for Thorium. 10 standard Nb-Ta samples were purchased from Vancouver and South Africa to control the XRF detection quality. The field team frequently used the XRF to analyze the standard samples and compared the results, indicating that the Niobium and Thorium detection errors are less than 20%. However, the Ta results are more variable.

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WILDSKY RESOURCES INC. Management’s Discussion and Analysis For The Year Ended November 30, 2022

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WILDSKY RESOURCES INC. Management’s Discussion and Analysis For The Year Ended November 30, 2022

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By the end of June, the Company completed 19.8 square kilometers of mapping and geochemical surveys. In addition, 1297 rock samples and 491 soil samples have been analyzed. Obvious Niobium-Thorium anomalies have been delineated at the Southern end and the North-Eastern corner of EL 29624, which are coincident with the regional Thorium anomalies where the Kenyang Nb-Ta open-pit mine is located in.

The younger grey-white, fine-grained granite stocks outcropped in the South and North-East Niobium-Thorium anomalies area. This younger granite was thought an important mineralization caused intrusion in the Kenyang Niobium-Tantalum mine.

The Company started to drill five (5) shallow holes (100m each) to test the Niobium-Thorium anomalies, 1 in North-East and 4 in South Nb-Th anomaly, and drilling of hole BH05 is currently underway.

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WILDSKY RESOURCES INC. Management’s Discussion and Analysis For The Year Ended November 30, 2022

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WILDSKY RESOURCES INC. Management’s Discussion and Analysis For The Year Ended November 30, 2022

In addition, the Company’s technical team is also investigating new Lithium and Tantalum projects in Africa for potential acquisition by the company.

The technical disclosure in this news release was reviewed and approved by Wenhong Jin, P.Geo., the Qualified Person as defined by National Instrument 43-101.

SELECTED ANNUAL INFORMATION

The following table provides a brief summary of the Company’s financial operations. For more detailed information, refer to the Financial Statements.

	As at November 30,
	2022 2021 2020*
Current assets Non-current assets Total assets Current liabilities Non-current liabilities Shareholders' equity	$ 8,180,873 $ 9,706,797 $ 847,625 411,006 199,496 8,104,593
	8,591,879 9,906,293 8,952,218
	113,396 483,055 726,115 - - - 8,478,483 9,423,238 8,226,103
Total liabilities and shareholders' equity	8,591,879 9,906,293 8,952,218
Workingcapital	$8,067,477 $9,223,742 $121,510

	Year ended November 30,
	2022 2021 2020*
Revenue	$ - $ - $ -
Expenses Other income (loss)	( 906,186) ( 579,697) ( 503,012) (2,380,492) 1,376,211 1,601,409
Income (loss) and comprehensive income (loss) for the year	$ (3,286,678) $ 796,514 $ 1,098,397
Basic income (loss) per share	$ (0.11) $ 0.03 $ 0.07
Weighted average number of common shares outstanding-Basic	29,314,150 24,076,964 14,839,813
Diluted income (loss) per share	$ (0.11) $ 0.03 $ 0.07
Weighted average number of common shares outstanding- Diluted	29,314,150 28,926,964 16,239,813

• During the year ended November 30, 2020, the Company disposed 100% of its subsidiary Cassiar (2020) Gold Corp. who owns Table Mountain Property and Taurus Property in BC. All related assets and liabilities were deconsolidated as of October 9, 2020.

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WILDSKY RESOURCES INC. Management’s Discussion and Analysis For The Year Ended November 30, 2022

QUARTERLY INFORMATION

		Three month		Three month		Three month		Three month
		period ended		period ended		period ended		period ended
		November 30,		August 31,		May 31,		February 28,
		2022		2022		2022*		2022*
Total assets	$	8,591,879	$	7,004,986	$	7,310,075	$	13,203,012
Working capital (deficiency)		8,067,477		6,557,446		6,893,998		12,723,251
Shareholders’ equity		8,478,483		6,973,898		7,258,477		12,922,150
Net income (loss) and comprehensive income
(loss)		(477,428)		(283,781)		(5,863,673)		3,338,201
Earning (loss) per share – basic and diluted		(0.02)		(0.01)		(0.22)		0.13/0.10
		Three month		Three month		Three month		Three month
		period ended		period ended		period ended		period ended
		November 30,		August 31,		May 31,		February 28,
		2021***		2021**		2021		2021
Total assets	$	9,906,293	$	7,848,833	$	8,391,948	$	8,728,603
Working capital (deficiency)		9,223,742		(152,814)		19,117		(150,390)
Shareholders’ equity		9,423,238		7,445,701		8,017,204		7,956,276
Net income (loss) and comprehensive income
(loss)		1,977,537		(662,575)		(255,071)		(263,377)
Lossper share – basic and diluted		0.08/0.07		(0.03)		(0.01)		(0.02)

• During the three months ended February 28, 2022, the Company recorded a gain of 3,620,023 from fair value adjustment of the investments. During the three months ended May 31, 2022, the Company recorded a loss of 5,727,300 from fair value adjustment of the investments.

** During the three months ended August 31, 2021, the Company recorded a loss on dilution of equity investment of $417,227.

***During the three months ended November 31, 2021, the Company recorded gain on disposal of investment of $443,591, gain on dilution of investment in equity investment of $565,662, and gain of $744,320 of fair value adjustment of the investment.

REVIEW OF FINANCIAL RESULTS

Years ended November 30, 2022 and 2021

Net Income

For the year ended November 30, 2022, the Company incurred net loss of $3,286,678 as compared to an income of $796,514 for the comparative year ended November 30, 2021.

The significant net loss during the current year ended November 30, 2022 is due to recognition of $2,573,415 of decrease in the fair value of 7,602,000 shares of Cassiar Gold Corp. (“GLDC”) the Company held at the year end. The Company also realized a gain of $166,741 on disposal of 2,558,000 GLDC shares during the year ended November 30, 2022.

During the year ended November 30, 2021, the Company recorded gain of $443,591 from disposal of 1,480,000 GDLC shares, gain on dilution of investment in equity method of $565,662, and $744,320 of fair value adjustment on the remaining 10,160,000 GDLC shares held t at year end.

During the year ended November 30, 2021, the Company wrote off exploration and evaluation assets of $51,354 (2020 - $Nil) in relation to expired Au-Pb ELs in Nigeria.

Expenses

Expenses for the year ended November 30, 2022 were $906,186 as compared to $579,697 of 2021. The expenses were consisted of:

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WILDSKY RESOURCES INC. Management’s Discussion and Analysis For The Year Ended November 30, 2022

• Accretion of interest of $18,792 (2021 - $68,296) is related to $Nil (2021 - $502,000) of convertible debentures outstanding during the period;

• Amortization expense of $21,784 (2021 - $17,105) is amortization of computer equipment and field equipment;

• Directors fee of $12,000 (2021 – $15,000) was accrued to two directors (2021 – two directors and one formal director);

• Filing and transfer agent fee of $17,622 (2021 - $21,468) was monthly transfer agent fee and TSX-V annual sustaining fees, and SEDAR filing fees;

• Management fee of $184,000 (2021 – $124,000) was accrued or paid to a company controlled by the CEO and President, and $72,000 (2021 - $72,000) to a company controlled by the CFO;

• Professional fees consisted of $25,369 (2021 – $30,060) legal fees and $36,623 (2021 - $29,798) of accounting, auditing and tax filing fees.

• Project investigation fee of $298,402 (2021 - $21,868) was related to seeking and investigating projects in Africa, and study and analyze geological data;

• Rent and office expenses of $42,007 (2021- $18,327) increased due to the Company’s moving to a new office in April 2022.

• Salary and benefits of $5,301 (2021 - $59,214) is due to an executive assistant hired from January 1, 2021 to December 31, 2021;

• Share-based compensation of $160,711 (2021 - $91,071) is fair value of 1,000,000 (2021 – 500,000) stock options granted during the period.

• Shareholder costs of $3,857 (2021 - $9,078) was for website update/maintenance and news releases. The higher cost in the comparative year is mainly due to the cost of building a new website.

• Travel of $7,718 (2021 - $2,412) was for attending PDAC and events.

Three months ended November 30, 2022 and 2021

Net Income (Loss)

For the three months ended November 30, 2022, the Company had a net loss of $477,428 compared with an income of 1,977,537 for the same period in 2021.

The significant net loss during the current three months ended November 30, 2022 is due to recognition of $304,080 of decrease in the fair value of 7,602,000 shares of Cassiar Gold Corp. (“GLDC”) the Company held at the period end.

The income during the three months ended November 30, 2021 was mainly due to gain of $443,591 from disposal of 1,480,000 GDLC shares, gain on dilution of investment in equity method of $982,889, and $744,320 of fair value adjustment on the remaining 10,160,000 GDLC shares held t at period end.

During the three months ended November 30, 2021, the Company wrote off exploration and evaluation assets of $51,354 (2020 - $Nil) in relation to expired Au-Pb ELs in Nigeria.

Expenses for the three months ended November 30, 2022 were $194,929, comparable with $141,910 for the same three-month period in 2021.

LIQUIDITY, CAPITAL RESOURCES AND GOING CONCERN

The Company is in the exploration stage and no revenue has been generated to date. At November 30, 2022, the Company had cash of $3,665,207 (2021 - $1,367,438) and a working capital of $8,067,477 (2021 – $9,223,742).

In the past, operating capital and exploration requirements have been funded primarily from equity financing and the Company will need to arrange equity or other financing in the near future in order to continue in operation. While the

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WILDSKY RESOURCES INC. Management’s Discussion and Analysis For The Year Ended November 30, 2022

Company has been successful in raising capital in the past, there can be no assurance that such financing will be available to the Company in the amount required or that it can be obtained on terms satisfactory to the Company. The Company’s current financial situation indicates material uncertainties that cast significant doubt about the Company’s ability to continue as a going concern.

Cash Flows

Under operating activities, the Company used $869,495 in the year ended November 30, 2022, as compared with $334,238 in the comparative year ended November 30, 2021.

In the investing activities, during the year ended November 30, 2022, the Company received $1,493,346 (2021 - $1,179,891) of proceeds from sale of 2,558,000 (2021 – 1,480,000) GDLC shares. The Company spent $212,785 (2021 - $146,020) on exploration work of its Nigeria property and $Nil (2021 - $66,475) to apply an Exploration Licenses in Ethiopia during the year ended November 30, 2022.

During the year ended November 30, 2022, the Company closed a private placement by issuing 13,333,332 shares at $0.15 per share for gross proceeds of $2,000,000. The Company incurred share issue costs of $18,788.

During the year ended November 30, 2021, the Company incurred $6,450 of share issuance costs on the $800,000 private placement closed in December 2020, the proceeds of which was received in May 2020 and deposited in a restricted GIC. In April and May 2021, the Company repaid convertible loan interest of $50,200 and principal of $10,000.

SUBSEQUENT EVENTS

N/A

OUTSTANDING SHARE DATA

The following table summarizes the Company’s outstanding share data as of the date of this MD&A:

	Numberofsecurities
Common shares	41,093,141
Stock options	2,350,000
Warrants	4,000,000

OFF-BALANCE SHEET ARRANGEMENTS

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

RELATED PARTY TRANSACTIONS

The Company entered into the following transactions with related parties during the year ended November 30, 2022:

a) the Company paid or accrued management fee of $184,000 (2021 - $124,000) to a company controlled by the CEO and President. As of November 30, 2022, $16,800 (November 30, 2021 - $96,198) of services fees payable to the company controlled by the CEO and President, and $1,957 (November 30, 2021 - $Nil) of expense reimbursement owing to the CEO were included in due to related parties.

b) the Company paid or accrued management fees of $72,000 (2021 -$72,000) to a company controlled by the CFO. As of November 30, 2022, $6,300 (November 30, 2021 - $51,987) payable to the company controlled by the CFO was included in due to related parties.

c) the Company accrued directors’ fees of $12,000 (2021 -$15,000) to two directors and one ex-director. As of November 30, 2022, $27,000 (November 30, 2021 - $15,000) payable to the three directors was included in due to related parties.

d) the Company granted 800,000 (2021 – 500,000) stock options to a director, valued at $128,568 (2021 - $91,071).

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WILDSKY RESOURCES INC. Management’s Discussion and Analysis For The Year Ended November 30, 2022

Accounts payable to related parties do not bear interest, are unsecured and repayable on demand.

FINANCIAL INSTRUMENTS AND RELATED RISKS

The Company’s accounts payable and accrued liabilities, due to related parties, and convertible debentures are measured at amortized cost. Its financial assets, GST receivable, is also measured at amortized cost. The Company’s carrying values of these items approximate their fair value due to the relatively short periods to maturity of the instruments.

Financial risk management

The Company’s objective in risk management is to maintain its ability to continue as a going concern. It is exposed to the following risks:

Liquidity risk

Liquidity risk is the risk that the Company might not be able to meet its obligations and commitments as they come due. As at November 30, 2022, the Company had cash of $3,665,207 (November 30, 2021 - $1,367,438) and a working capital of $8,067,477 (November 30, 2021 – $9,223,742).

Credit risk

Credit risk arises from cash held with financial institutions as well as credit exposure on outstanding receivables.

The Company’s cash is held at high-credit rating financial institutions. The Company’s maximum exposure to credit risk is the carrying amounts of cash and receivables on its consolidated statement of financial position.

Market risk

Market risk is the risk of loss that may arise from changes in market factors such as interest rates, foreign exchange rates, and commodity and equity prices.

i. Interest rate risk

Interest rate risk arises from changes in market rates of interest that could adversely affect the Company. The Company’s convertible debentures bear interest at 10% per annum. The Company’s exposure to interest rate risk is insignificant.

ii. Foreign currency risk

Foreign currency risk arises from fluctuations in foreign currencies versus the Canadian dollar that could adversely affect reported balances and transactions denominated in those currencies. The Company currently has no significant assets or liabilities and has no revenue or expenses denominated in a foreign currency, so it is not exposed to foreign currency risk.

iii. Equity price risk

Equity price risk arises from market fluctuations in equity prices that could adversely affect the Company’s operations. The Company’s current exposure to equity price risk is limited to declines in the values and volumes including those of its own shares, which could impede its ability to raise additional funds when required.

RISKS AND UNCERTAINTIES

Due to nature of the Company’s business in mineral exploration and development, it is subject to various risks and uncertainties associated with the mining and extraction industry. If any of the following risks occur, the Company’s going concern, operating results and financial position could be adversely impacted.

Exploration Risk

Mineral exploration activities are inherently risky. Few properties that are explored are eventually developed into producing mines. Exploration activities on the Company’s Nasarawa mineral properties in Nigeria have not yet resulted in discoveries of commercial mineralization to take the Company to the producing stage. If there are no further discoveries of mineral reserves, the Company may be forced to look for other exploration projects and abandon the existing properties.

Mineral Resources

The mineral resource figures disclosed in the MD&A are estimates only and the Company cannot be certain that specific

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WILDSKY RESOURCES INC. Management’s Discussion and Analysis For The Year Ended November 30, 2022

quantities of gold or other minerals will be realized. These estimates are subject to the assumptions and judgments used in the geological interpretations. Any material changes in the mineralization, grade, metal prices and market conditions could have a serious adverse effect on the economic viabilities of the Company. Until the estimated deposits are mined and processed, the mineral resources and its grades remain estimates only.

Commodity Prices

The Company’s future viability depends largely on the movement of the price of gold as the Company’s mineral resources are primarily of gold. Gold prices have been historically volatile reacting to conditions beyond the Company’s control, including international politics, economic crisis, global supply and demand and investors’ sentiment. These uncertainties and volatility could affect negatively the Company’s ability to raise capital for its exploration activities.

Global Economy and Financial Markets

The Company has no revenue from its operations and relies on the capital markets to raise equity financings for its operations. The ongoing civil war in Syria, instability in the Middle East, proliferate terrorist attacks in Europe and the increase of US interest rate have all adversely affected the global economy. The market uncertainty has led to the capital especially in natural resource sectors with uneconomically low commodity prices. This results in extreme challenges for exploration companies to seek funds from the financial markets.

Government and Environmental Regulations

The Company’s operations are subject to various regulations governing prospecting, permitting, mine safety, labour standards, explosive storage, reclamation, spills, tailings disposal and any other environmental issues. There is no guarantee that new rules and compliances will not be enacted or existing regulations will not be changed and applied in such a way that they may adversely affect the Company’s operations. Environmental legislation has becoming more stringent and penalties are enforced for non-compliance. Compliance with existing and evolving regulations means increasing costs to the Company.

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