Horizon Copper : 2024 Q1 Financial Report

Q1 2024

Management's Discussion and Analysis

For The Period Ended March 31, 2024

Q1

Management's Discussion and Analysis

2024

This management's discussion and analysis ("MD&A") for Horizon Copper Corp. and its subsidiary entities (collectively "Horizon", or the "Company") should be read in conjunction with the unaudited condensed consolidated interim financial statements of Horizon for the three months ended March 31, 2024 and related notes thereto, which have been prepared in accordance with International Financial Reporting Standards Accounting Standards as issued by the International Accounting Standards Board ("IFRS Accounting Standards" or "IFRS"), applicable to the preparation of interim financial statements including International Accounting Standard 34 - Interim Financial Reporting. Readers are encouraged to consult the Company's audited consolidated financial statements for the year ended December 31, 2023 and the corresponding notes to the financial statements which are available on SEDAR+ at www.sedarplus.ca. The information contained within this MD&A is current to April 30, 2024 and all figures are stated in U.S. dollars unless otherwise noted.

Company Highlights

Antamina Granted Approval of MEIA, Extending Mine Life

In February 2024, the Antamina copper mine in Peru received approval of the Modification of Environmental Impact Assessment (the "MEIA"). The MEIA allows for an investment of approximately $2 billion by the entity which owns the Antamina mine over the next eight years, which will extend operations through to 2036. The MEIA extends the permitted pit depth by 150 metres and will allow Antamina to optimize existing mining components within its current operation while also expanding the footprint of the open pit and expansion of tailings facilities. The MEIA also considers processing capacity of up to 208 thousand tonnes per day ("ktpd") which would be an approximate 40% increase from current levels of 145 ktpd.

Horizon Copper holds a net profits interest in the Antamina mine (the "Antamina NPI"). The formal extension to the mine life has the following impact on the Antamina NPI:

• increased certainty surrounding production from Antamina over a longer timeframe and a platform for further mine life extensions which will deliver cash flow to Horizon for many years;
• no capital outlay required by Horizon for the expansion activities; to the extent expansion and development capital are funded by operating flows from Antamina, the amounts are deducted in arriving at the Antamina NPI payment due to Horizon each quarter and to the extent the costs are funded through debt at the company which owns Antamina, no amounts are expected to be deduced from the Antamina NPI payments.

Hugo North Extension Drill Results and Underground Development Update

In February 2024, Entrée Resources Ltd ("Entrée") released partial drill results from the 2022 drill program at the Hugo North Extension ("HNE") - a portion of the Oyu Tolgoi copper project that is subject to the Entrée joint venture interest (the "Entrée/Oyu Tolgoi JV Property"). The drill results, which

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Management's Discussion and Analysis

2024

are the first holes drilled into the HNE since 2011, demonstrate continuity of the significant copper and gold grades at the HNE deposit.

Highlighted drill results include underground drill holes:

1. DDH UGD583A: 274 metres grading 2.36% copper and 0.73 grams per tonne gold
2. DDH UGD586: 178 metres grading 2.90% copper and 0.96 grams per tonne gold, including 144 metres grading 3.50% copper and 1.07 grams per tonne gold

In addition to the drill results, Entrée reported updates on the underground infrastructure development work on the Entrée/Oyu Tolgoi JV Property. Development activity is scheduled to commence in the second half of 2024 and will start in the southwest corner of the HNE deposit on the Shivee Tolgoi mining licence. Production from the Entrée/Oyu Tolgoi JV Property is expected to commence in 2027.

Horizon Copper Begins to Trade Shares on the OTCQX

On April 4, 2024, the Company began to trade its common shares on the OTCQX® Best Market under the ticker symbol "HNCUF". Horizon continues to trade on the TSX Venture Exchange as its primary listing under the symbol HCU.

The OTCQX Best Market is the highest market tier of OTC Markets on which 12,000 U.S. and global securities trade. Trading on OTCQX is expected to enhance the visibility and accessibility of the Company to U.S. investors.

Overview

Horizon is a resource company with a portfolio of high-qualitycash-flowing and development stage copper assets. Horizon's objective is to actively grow its existing portfolio of assets, with a focus on copper projects, including through strategic partnership opportunities with Sandstorm Gold Ltd.

("Sandstorm").

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Management's Discussion and Analysis

2024

Outlook

The outlook for the Company and its key assets for 2024 and beyond includes the following:

Antamina

The Company generates royalty revenue and cash flows from the Antamina NPI on a quarterly basis. The amount of the NPI payment is dependent on a number of factors, including: commodity prices (including copper, silver and zinc); operational and financial performance of the Antamina mine during the period; extent of capital expenditure; and changes in working capital and provisions such as asset retirement obligations. At current copper prices, the estimated average annual cash flow from the Antamina NPI over the currently permitted mine life to 2036, net of amounts paid to Sandstorm under the Antamina Silver Stream and Residual Royalty, is $10 - $15 million.

Hod Maden

SSR Mining Inc. ("SSR Mining") became the operator at Hod Maden in the second quarter of 2023 and its development team continued to progress the early-works construction activities while simultaneously performing a detailed review of the construction, engineering and design plans for the mine.

On February 13, 2024, SSR Mining reported an operational incident at one of its other Turkish assets. On February 27, 2024, as a result of this incident, SSR Mining retracted all previously issued guidance for its Turkish assets, including Hod Maden. While SSR Mining focuses on remediation efforts at its other asset, Horizon believes it is reasonable to expect some development delays at Hod Maden. Activity at Hod Maden for the first half of 2024 is expected to be focused on ongoing optimization, engineering and mine design. The Company expects to obtain further updated construction timelines from the operator when available.

Oyu Tolgoi

Based on the current schedule at Oyu Tolgoi being managed by Rio Tinto plc ("Rio Tinto"), development activity on the Entrée/Oyu Tolgoi JV Property is expected to commence in the second half of 2024 with underground production (including the Hugo North Extension) expected in 2027. Under this timeline, Entrée (in which the Company has a 24% equity interest) expects its first share of attributable cash flow in 2029.

Growth

The Company will continue to evaluate new opportunities to grow its portfolio of assets with a focus on identifying interests in copper projects with precious metal by-products which could be partially funded by stream financing provided by Sandstorm.

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Management's Discussion and Analysis

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Key Assets

Antamina

Antamina is an open-pit copper mine located in the Andes Mountain range of Peru, 270 kilometres north of Lima. It is the world's third-largest copper mine on a copper equivalent ("CuEq") basis, producing approximately 560,000 CuEq tonnes per annum. Antamina has been in consistent production since 2001, including a throughput expansion completed in 2012 to the mine's current operating capacity of 145 ktpd. The asset operates in the first cost quartile of copper mines.

On June 15, 2023, the Company acquired the Antamina NPI representing a 1.66% net profits interest on the Antamina copper mine. Part of the purchase consideration for the Antamina NPI included a silver stream with Sandstorm referenced to silver production from the Antamina mine (the "Antamina Silver Stream") whereby the Company will sell to Sandstorm silver ounces equal to 1.66% of all silver produced at the Antamina mine at a price equal to 2.5% of the silver spot price. In addition, Sandstorm retained a residual royalty on Antamina with payments equal to one-third (1/3) of the total Antamina NPI after deducting the Antamina Silver Stream servicing commitments (the "Residual Royalty").

The substance of the Antamina NPI is that of a royalty on the Antamina mine. The Antamina NPI is paid 45 days after each calendar quarter end by a Canadian affiliate of Teck Resources Limited ("Teck") and is guaranteed by Teck. The Antamina NPI is calculated as 1.66% of the net proceeds (gross revenue less operating and capital expenses) of the entity which owns the Antamina mine, Compañía Minera Antamina S.A. ("CMA"), adjusted for changes in working capital and movements in provisions such as asset retirement obligations.

Since 2006, the Antamina NPI has paid between $7-$42 million per year, with an average annual payment of $19 million. The amount attributable to Horizon, net of the Antamina Silver Stream obligation and Residual Royalty, is expected to average approximately 50-60% of the gross amount received.

Hod Maden

The Company has a 30% equity interest in the entity which holds the Hod Maden copper-gold project, which is located in Artvin Province, northeastern Türkiye. Assuming the terms of the earn-in milestone payments are fulfilled ($150 million in earn-in structured cash milestone payments, linked to construction and commercial production milestones at Hod Maden), SSR Mining will hold a 40% operating interest in Hod Maden, with the remaining passive ownership held by Lidya Madencilik Sanayi ve Ticaret A.S. ("Lidya") (30%) and Horizon (30%). SSR is now the project operator and it is anticipated that SSR will lead the development of the project to a formal construction decision and commercial production.

In October 2021, the Hod Maden project received the final approval of the Environmental Impact Assessment ("EIA") for the project from the Ministry of Environment and Urbanization of Türkiye.

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Management's Discussion and Analysis

2024

In November 2021, a Feasibility Study was released. The results demonstrate a Proven and Probable Mineral Reserve of 2.5 million ounces of gold and 129,000 tonnes of copper being mined over a 13- year mine life (8.7 million tonnes at 8.8 grams per tonne gold and 1.5% copper or 11.1 grams per tonne gold equivalent using a breakeven cut-off value of $82 per tonne and incremental cut-off values of $63 per tonne for stopes and $40 per tonne for development). The study projects a pre-tax net present value (5% discount rate) of $1.3 billion and an internal rate of return of 41%. It is estimated that copper will be produced at an all-in sustaining cost ("AISC")1 on a co-product basis of $1.12 per pound.

With the approval of the EIA, the release of the Feasibility Study and the receipt of key permits (with the award of the final permit from the Ministry of Forestry in 2022), Hod Maden moved into the next stage of development including securing project debt financing and initiating long-lead construction items. Early- works construction activities at Hod Maden are expected to be focused on site access and earthworks, power supply construction and the land expropriation process.

The Company entered into a gold stream on Hod Maden as part of the consideration paid to acquire the asset. Under the terms of the stream, the Company will purchase and deliver to Sandstorm 20% of all gold produced from Hod Maden (on a 100% basis) for ongoing payments of 50% of the gold spot price until 405,000 ounces of gold are delivered (the "Delivery Threshold"). Once the Delivery Threshold has been reached, the Company will deliver 12% of the gold produced for the life of the mine for ongoing payments of 60% of the gold spot price.

1. Refer to section on non-IFRS and other measures of this MD&A.

Oyu Tolgoi (Hugo North Extension & Heruga)

The Company has an approximate 24% equity interest in Entrée which holds a 20% interest in the Hugo North Extension and Heruga deposits of the Oyu Tolgoi copper mine located in Mongolia, (the "Hugo North Extension" and "Heruga", respectively).

The Hugo North Extension is a copper-gold porphyry deposit and Heruga is a copper-gold-molybdenum porphyry deposit. Both projects are located in the South Gobi Desert of Mongolia, approximately 570 kilometres south of the capital city of Ulaanbaatar and 80 kilometres north of the border with China. The Hugo North Extension and Heruga are part of the Oyu Tolgoi mining complex and are managed by Oyu Tolgoi LLC, a subsidiary of Rio Tinto plc, with a 34% minority interest owned by the Government of Mongolia.

In 2021, Entrée announced the completion of an updated Feasibility Study on its interest in the Entrée/ Oyu Tolgoi joint venture property. The updated report aligns Entrée's disclosure with that of other Oyu Tolgoi project stakeholders on development of the first lift of the underground mine. Entrée further announced that optimization studies on Panel 1 were planned (subsequently completed in the second quarter of 2023) which have the potential to further improve Lift 1 economics for the Entrée/Oyu Tolgoi joint venture.

Rio Tinto has announced that underground production has commenced at Oyu Tolgoi. Over 70 drawbells have been blasted since January 2022 and the first sustainable production from the underground mine was achieved in the first quarter of 2023 on the area of the mine wholly owned by Oyu Tolgoi LLC. Technical studies for Panels 1 and 2 mine design and schedule optimization were completed by Oyu Tolgoi LLC during the second quarter of 2023. According to Rio Tinto, the technical

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Management's Discussion and Analysis

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studies have resulted in substantially de-risked, resilient mine designs that provide a pathway to ramp- up, flexibility to pursue value creating opportunities and react to future risks, and improved stability, constructability, and operability. The studies also provide a pathway to bring the panels into production faster and maximize the use of the ventilation system.

The Lift 1 mine plan incorporates the development of three panels, and in order to reach the full sustainable production rate of 95,000 tonnes per day from the underground operations all three panels need to be in production. The Hugo North Extension deposit on the Entrée/Oyu Tolgoi joint venture property is located at the northern portion of Panel 1, where the first underground production is expected in 2027 and attributable cash flow to Entrée commencing in 2029.

The Company is not required to contribute any further capital, exploration, or operating expenditures to Entrée and Entrée has a carried joint venture interest in the Hugo North Extension and Heruga.

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Management's Discussion and Analysis

2024

Summary of Quarterly Results

Quarters Ended

In $000s

(except for per share amounts in $)

Mar. 31, 2024

Dec. 31, 2023

Sep. 30, 2023

Jun. 30, 2023

Total revenue	1,748	503	2,959	592
Net (loss) income	(16,334)	(31,077)	(4,048)	15,151
Adjusted net (loss) income1	(240)	(1,983)	835	429
Basic (loss) income per share	(0.19)	(0.36)	(0.05)	0.20
Diluted (loss) income per share	(0.19)	(0.36)	(0.05)	0.19
Cash flows from (used in) operating activities	303	2,908	766	(95)
Total assets	516,811	520,245	525,398	530,278
Total long-term liabilities	521,051	504,465	478,816	478,989
In $000s
(except for per share amounts in $)	Mar. 31, 2023	Dec. 31, 2022	Sep. 30, 2022	Jun. 30, 2022
Total revenue	-	-	-	(556)
Net (loss) income	(3,708)	(5,366)	(9,775)	(757)
Adjusted net (loss) income1	83	(179)	(403)	(633)
Basic (loss) income per share	(0.05)	(0.07)	(0.29)	(0.05)
Diluted (loss) income per share	(0.05)	(0.07)	(0.29)	(0.05)
Cash flows from (used in) operating activities	383	3	(413)	154
Total assets	300,026	300,706	300,134	58,495
Total long-term liabilities	276,431	273,382	266,043	33,839

1. Refer to section on non-IFRS and other measures of this MD&A.

Prior to August 31, 2022, the results reflect those prior to the acquisition of the Company's existing portfolio of assets when it was previously known as Royalty North Partners Ltd. ("RNP") and are therefore not indicative of expected results of Horizon in future periods. The results of each of the quarterly periods prior to Q3 2022 have been restated in USD following the Company's change in presentation currency in Q3 2022.

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Management's Discussion and Analysis

2024

Quarterly Commentary

Three Months Ended March 31, 2024

Compared to the Three Months Ended March 31, 2023

For the three months ended March 31, 2024, net loss was $16.3 million, compared with $3.7 million for the comparable period in 2023. The increase in net loss is primarily attributable to the following:

• An increase in the non-cash fair value loss on the gold stream obligation whereby during the three months ended March 31, 2024 the Company recorded a fair value loss of $5.1 million, primarily due to an increase in forward gold prices used to value the liability and partially offset by changes in estimated timing of future gold deliveries, compared to a fair value loss on the gold stream obligation of $3.3 million in the comparable period. The corresponding asset associated with the gold stream obligation is not revalued based on increases in the forward gold price for accounting purposes.
• A non-cash fair value loss on the Antamina Silver Stream obligation, which was acquired in the second quarter of 2023, of $11.6 million during the three months ended March 31, 2024, primarily due to an increase in forward silver prices used to value the liability at the end of the period. The corresponding asset associated with the Antamina Silver Stream obligation is not revalued based on increases in the forward silver price for accounting purposes.
• Depletion expense of $1.8 million related to the Antamina NPI as a result of the acquisition of the Antamina NPI in June 2023.
• Non-cashaccretion expense related to the Company's promissory notes with Sandstorm of $2.8 million during the three months ended March 31, 2024, compared to accretion expense of $1.2 million during the comparable period which only related to the Hod Maden Promissory Note.

Partially offset by:

• A $4.3 million gain related to changes in the estimated timing of cash flows related to the Company's promissory notes during the three months ended March 31, 2024, compared to a $1.6 million gain in the comparable period.
• $1.7 million of revenue earned during the three months ended March 31, 2024 following the acquisition of the Antamina NPI in June 2023.

For the three months ended March 31, 2024, Adjusted Net Loss1 was $0.2 million compared to an Adjusted Net Income1 of $0.1 million in the comparable period in 2023. The increase in adjusted net loss for the three months ended March 31, 2024 is primarily due to $1.8 million of depletion expense, partially offset by $1.7 million of revenue earned from the Antamina NPI.

1. Refer to section on non-IFRS and other measures of this MD&A.

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Management's Discussion and Analysis

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Three Months Ended March 31, 2024

Compared to the Other Quarters Presented

When comparing net loss of $16.3 million for the three months ended March 31, 2024 with net income for the other quarters presented, the following items impact comparability:

• Revenue attributable to the Antamina NPI, which was acquired in June 2023.
• The recognition of non-cash fair value gains and losses with respect to revaluation of the Company's stream obligations and non-cash gains and losses with respect to changes in the estimated timing of cash flows of the Company's promissory notes are as follows:

In $ millions	Mar. 31, 2024	Dec. 31, 2023	Sep. 30, 2023	Jun. 30, 2023
Gain (loss) on revaluation of stream obligations	(16.7)	(26.4)	(0.9)	9.6
Gain (loss) from change in estimated timing of cash	4.3	1.2	(0.4)	6.9
flows of promissory notes

In $ millions

Mar. 31, 2023

Dec. 31, 2022

Sep. 30, 2022

Jun. 30, 2022

Gain (loss) on revaluation of stream obligations	(3.3)	(2.6)	(6.2)	-
Gain (loss) from change in estimated timing of cash	1.6	(1.2)	-	-
flows of promissory notes

• For periods prior to June 30, 2022, movements in net income (loss) and cash flows from operating activities were primarily driven by changes in revenue from the Company's legacy royalty investments. Net income was also impacted by fair value adjustments on these investments each period. All of the Company's legacy royalty investments have now been settled.

Change in Total Assets

Total assets decreased by $3.4 million from December 31, 2023 to March 31, 2024 primarily as a result of depletion of the Antamina NPI and the Company's share in net loss of associates.

Total assets decreased by $5.2 million from September 30, 2023 to December 31, 2023 primarily as a result of depletion of the Antamina NPI and the Company's share in net loss of associates.

Total assets decreased by $4.9 million from June 30, 2023 to September 30, 2023 primarily as a result of depletion of the Antamina NPI and the Company's share in net loss of associates.

Total assets increased by $230.3 million from March 31, 2023 to June 30, 2023 as a result of the acquisition of the Antamina NPI from Sandstorm in June 2023.

There were no material changes in total assets from September 30, 2022 to March 31, 2023.

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