Patagonia Gold : Q1 2024 Management’s Discussion and Analysis

PATAGONIA GOLD CORP.

MANAGEMENT'S DISCUSSION AND ANALYSIS

For the three months ended March 31, 2024

May 30, 2024

The following management's discussion and analysis ("MD&A") of Patagonia Gold Corp. (hereinafter referred to as the "Company" or "Patagonia"), formerly Hunt Mining Corp. ("Hunt") and its subsidiaries provides an analysis of the operating and financial results for the three months ended March 31, 2024 and a comparison of the material changes in our results of operations between the three months ended March 31, 2023 and financial condition between the year ended December 31, 2023. This MD&A should be read in conjunction with the Corporation's unaudited condensed interim consolidated financial statements ("interim financial statements") for the three months ended March 31, 2024, annual audited consolidated financial statements for the year ended December 31, 2023 and related MD&A.

These statements have been prepared in accordance with IFRS Accounting Standards ("IFRS Accounting Standards") as issued by the International Accounting Standards Board ("IASB"). This MD&A includes certain non-IFRS financial performance measures. For a detailed description of these measures, please see "Non-IFRS Financial Performance Measures" section. The amounts presented in this MD&A are in thousands ($'000) of U.S. dollars, except share, per share, per unit amounts and unless otherwise noted.

The Company's head office and principal business address is Av. Libertador 498 Piso 26, Buenos Aires, Argentina, C1001ABR and the registered office address is 2200 HSBC Building, 885 West Georgia Street, Vancouver, British Columbia, V6C 3E8. The Company's common shares trade on the TSX Venture Exchange (the "Exchange"), under the symbol PGDC. Additional information relevant to the Company's activities can be found on their website at http://patagoniagold.com, on SEDAR at www.sedarplus.ca.

Management's Responsibility for Financial Reporting

The interim financial statements have been prepared by management in accordance with IFRS Accounting Standards and have been approved by the Company's board of directors (the "Board"). The integrity and objectivity of the financial statements are the responsibility of management. In addition, management is responsible for ensuring that the information contained in the MD&A is consistent where appropriate, with the information contained in the interim financial statements.

The interim financial statements may contain certain amounts based on estimates and judgments. Management has determined such amounts on a reasonable basis to ensure that the interim financial statements are presented fairly in all material respects.

As the Company is a Venture Issuer (as defined under under National Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings) ("NI 52-109"),the Company and management are not required to include representations relating to the evaluation, design, establishment and/or maintenance of disclosure controls and procedures ("DC&P") and/or Internal Controls over Financial Reporting ("ICFR"), as defined in NI 52-109,nor has it completed such an evaluation. Inherent limitations on the ability of the certifying officers to design and implement on a cost-effectivebasis DC&P and ICFR for the issuer may result in additional risks of quality, reliability, transparency and timeliness of interim and annual filings and other reports provided under securities legislation.

Cautionary Note on Forward-Looking Information

This MD&A contains "forward-looking information" and "forward-looking statements" within the meaning of applicable securities laws of Canada (collectively referred to as "forward-looking information") which relate to future events or the Company's future performance and may include, but are not limited to, statements about strategic plans, spending commitments, future operations, results of exploration, anticipated financial results, future work programs, capital expenditures and expected working capital requirements. Often, but not always, forward-looking information can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "continues", "forecasts", "projects", "predicts", "intends", "anticipates" or "believes", or variations of, or the negatives of, such words and phrases, or state that certain actions, events or results "may", "could", "would", "should", "might" or "will" be taken, occur or be achieved.

Readers are cautioned not to place undue reliance on forward looking information and there can be no assurance that forward looking information will prove to be accurate as the Company's actual results, performance or achievements may differ materially from any future results, performance or achievements expressed or implied by such forward-looking information if known or unknown risks, uncertainties or other factors affect the Company's business, or if the Company's estimates or assumptions prove inaccurate. Therefore,

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the Company cannot provide any assurance that forward-looking information will materialize. Factors that could cause results or events to differ materially from current expectations expressed or implied by the forward-looking information, include, but are not limited to: fluctuations in the currency markets (such as the Canadian Dollar, Chilean Peso, Great Britain Pound and the United States Dollar); changes in national and local government, legislation, taxation, controls, regulations and political or economic developments in Canada and Argentina or other countries in which the Company may carry on business in the future; operating or technical difficulties in connection with exploration and development activities; risks and hazards associated with the business of mineral exploration and development (including environmental hazards or industrial accidents); risks relating to the credit worthiness or financial condition of suppliers and other parties with whom the Company does business; the presence of laws and regulations that may impose restrictions on mining, including those currently enacted in Argentina; employee relations; relationships with and claims by local communities; availability and increasing costs associated with operational inputs and labour; the speculative nature of mineral exploration and development, including the risks of obtaining necessary licenses, permits and approvals from government authorities; business opportunities that may be presented to, or pursued by, the Company; challenges to, or difficulty in maintaining, the Company's title to properties; risks relating to the Company's ability to raise funds; and the factors identified under "Risk Factors" in this MD&A.

The forward looking information contained in this MD&A are based upon assumptions management believes to be reasonable including, without limitation: financing will be available for future exploration, development and operating activities; the actual results of the Company's development and exploration activities will be favourable or at least consistent with management's expectations; operating, development and exploration costs will not exceed management's expectations; all requisite regulatory and governmental approvals for development projects and other operations will be received on a timely basis upon terms acceptable to the Company, and applicable political and economic conditions will be favourable to the Company such as the continuing support for mining by local governments in Argentina; the price of gold and/or other applicable metals and applicable interest and exchange rates will be favourable to the Company or at least consistent with management's expectations; no title disputes will exist with respect to the Company's properties; debt and equity markets and other applicable economic conditions will be favourable to the Company; the availability of equipment and qualified personnel to advance exploration projects and; the execution of the Company's existing plans and further exploration and development programs for its projects, which may change due to changes in the views of the Company or if new information arises which makes it prudent to change such plans or programs.

All forward-looking-information contained in this MD&A is given as of the date hereof and is based upon the opinions and estimates of management and information available to management as at the date hereof. The Company disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.

The Company

On July 24, 2019, the Company and Patagonia Gold Limited ("PGL") [formerly Patagonia Gold PLC ("PGP")] completed a reverse acquisition (or reverse takeover, the "RTO") resulting in Hunt acquiring all issued shares of common stock of PGP in exchange for common shares of Hunt on the basis of 10.76 Hunt shares for each PGP share. Hunt issued 254,355,192 common shares to the shareholders of PGP representing an ownership interest of approximately 80%. The operating name of Hunt Mining Corp. was changed to Patagonia Gold Corp.

Patagonia is a mineral exploration and production Company incorporated on January 10, 2006 under the laws of Alberta, Canada and, together with its subsidiaries, is engaged in the exploration of mineral properties and exploitation of mineral resources and mineral reserves in the Santa Cruz, Rio Negro and Chubut Provinces of Argentina.

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The interim financial statements are presented on a consolidated basis and include the accounts of the Company, its wholly owned and majority owned subsidiary:

		Percentage	Functional
Corporation	Incorporation	ownership	currency	Business purpose
Patagonia Gold S.A. ("PGSA")	Argentina	95	US$	Production and Exploration Stage
Minera Minamalu S.A.	Argentina	100	US$	Exploration Stage
Huemules S.A.	Argentina	100	US$	Exploration Stage
Leleque Exploración S.A.	Argentina	100	US$	Exploration Stage
Patagonia Gold Limited (formerly
Patagonia Gold PLC)	UK	100	GBP$	Holding
Minera Calcatreu S.A.U. (formerly
Minera Aquiline S.A.U.)	Argentina	100	US$	Exploration Stage
Patagonia Gold Canada Inc.	Canada	100	CAD$	Holding
Patagonia Gold Chile S.C.M.	Chile	100	CH$	Exploration Stage
Ganadera Patagonia S.R.L.	Argentina	100	US$	Land Holding
1272680 B.C. Ltd (formerly 1494716
Alberta Ltd.)	Canada	100	CAD$	Nominee Shareholder

The Company's activities include the exploration for and production of minerals from properties in Argentina. On the basis of information to date, properties where it has not yet been determined if economically recoverable reserves exist are classified as exploration-stage. Properties where economically recoverable reserves exist and are being exploited are classified as production-stage. The underlying value of the mineral properties is entirely dependent upon the existence of reserves, the ability of the Company to obtain the necessary financing to complete development and upon future profitable production or a sale of these properties.

On some properties, ongoing production and sales of gold and silver are being undertaken without established mineral resources or reserves and the Company has not established the economic viability of the operations. As a result, there is increased uncertainty and economic risks of failure associated with these production activities. Despite the sale of gold and silver, these projects remain in the exploration stage because management has not established proven or probable reserves required to be classified in either the development or production stage.

Summary of Consolidated Results of Operations

				Three months ended March 31,
(in $000's, except ounces and per share amounts)		2024		2023		Change	%Change
Operational results
Total gold equivalent ounces - produced (1)		636		1,304		(668)	(51%)
Total gold equivalent ounces - sold (1)		850		1,598		(748)	(47%)
Financial results
Revenue	$	1,806	$	3,046	$	(1,240)	(41%)
Cost of sales	$	1,632	$	3,693	$	(2,061)	(56%)
Exploration expenses	$	804	$	1,165	$	(361)	(31%)
Repair and maintenance	$	198	$	169	$	29	17%
Depreciation, depletion and amortization	$	109	$	172	$	(63)	(37%)
Administrative expenses	$	673	$	1,157	$	(484)	(42%)
Interest expense	$	831	$	584	$	247	42%
Other income	$	121	$	1,928	$	(1,807)	(94%)
Net income (loss)	$	(2,276)	$	(2,619)	$	343	13%
Net income (loss) per share - basic and diluted	$	(0.005)	$	(0.006)	$	0.001	17%

1. Gold equivalent ounces include silver ounces produced and sold converted to a gold equivalent based on a ratio of the average spot market price for the commodities each period. The ratio for three months ended March 31, 2024 was 88.70:1 (2023 - 82.74:1).

Three months ended March 31, 2024 and 2023

Total production decreased during the three months ended March 31, 2024 as the Company had residual heap leach operations at Cap- Oeste since February 2019, which has been declining due to the depletion in the pads from ongoing leaching. Additional material being placed on the pads has not offset the overall declining production quarter over quarter. Sources for new fresh material to increase the production are being sought.

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The Company earned total revenue of $1,806 during the three months ended March 31, 2024 compared to $3,046 during the same period in 2023. Revenue decreased due to the lower gold equivalent ounces produced and sold during the period compared to the same period in 2023.

Cost of sales were $1,632 during the three months ended March 31, 2024 compared to $3,693 during the same period in 2023. Cost of sales decreased due to overall decrease in gold equivalent ounces produced and sold. During the three months ended March 31, 2023 inventory write down of $562 was included under cost of sales due to the net realizable value of the inventory was less than the costs incurred in establishing the gold held on carbon. There was no inventory write down during the three months ended March 31, 2024.

The Company incurred exploration expenses of $804 during the three months ended March 31, 2024 compared to $1,165 during the same period in 2023. The decrease in exploration expenses is related to overall less exploration activities for period compared to prior period.

The Company incurred repair and maintenance expense of $198 during the three months ended March 31, 2024 compared to $169 during the same period in 2023. The repair and maintenance expense during the period related to routine maintenance work at the Mina Martha Plant.

The Company incurred depreciation, depletion and amortization expenses of $109 during the three months ended March 31, 2024 compared to $172 during the same period in 2023. The decrease in depreciation, depletion and amortization expenses was due to the decrease in production.

The Company incurred administrative expenses of $673 during the three months ended March 31, 2024 compared to $1,157 during the same period in 2023. The decrease in administrative expenses was due to lower professional fees, salaries and compensations.

The Company incurred interest expense of $831 during the three months ended March 31, 2024 compared to $584 during the same period in 2023. The increase in interest expense was due to the increase in the Cantomi loan capital included in long-term debt.

As part of the Company´s treasury management, the Company trades certain securities denominated in US dollar and Argentine Peso. The Company recognized a gain on disposition of these securities of $121 during the three months ended March 31, 2024 compared to $1,928 during the same period in 2023.

Net loss for the three months ended March 31, 2024 was $2,276 compared to net loss of $2,619 during the same period in 2023. Net loss decreased due to the lower operating, exploration, administrative expenses.

Cash flows for the three months ended March 31, 2024 and 2023

The Company used $974 of cash in operating activities for the three months ended March 31, 2024 compared to $2,012 for the same period in 2023. The decrease in cash used in operating activities during 2024 was primarily due to an increase in accounts payable and accrued liabilities and a decrease in inventory compared to 2023.

Cash used in investing activities for the three months ended March 31, 2024 was $Nil compared to $152 for the same period in 2023. The decrease in cash used in investing activities was a result of lower purchases of property, plant and equipment.

Cash generated from financing activities for the three months ended March 31, 2024 was $659 compared to $2,333 during the same period in 2023. The decrease in cash generated from financing activities was primarily due to fewer funds drawn from the bank credit facilities.

Financial Position

Cash

The Company has cash on hand of $22 as of March 31, 2024 compared to $185 as of December 31, 2023.

Receivables

Current receivables are $426 as of March 31, 2024 compared to $352 as of December 31, 2023. The increase in current receivables is a result of the increase in VAT recoverable during the three months ended March 31, 2024.

Non-current receivables are $354 as of March 31, 2024 compared to $332 as of December 31, 2023. Non-current receivables remained consistent during the three months ended March 31, 2024.

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Inventories

The Company has inventories of $3,772 as of March 31, 2024 compared to $4,167 as of December 31, 2023. The decrease in inventory was mainly due to lower gold held on carbon as a result of the overall declining production quarter over quarter. During the three months ended March 31, 2023, the net realizable value of the inventory was less than the costs incurred in establishing the gold held on carbon and the Company recorded an inventory write down of $562.

Property, plant and equipment ("PPE")

The Company has PPE of $9,063 as of March 31, 2024 compared to $9,416 as of December 31, 2023. The decrease in PPE was a result of the depreciation charge which was partially offset by capital additions.

Bank indebtedness

The Company has bank indebtedness of $1,226 as of March 31, 2024 compared to $538 as of December 31, 2023. The increase in bank indebtedness was a result on drawing down against the existing lines of credit for operational purposes.

Accounts payable and accrued liabilities

The Company has accounts payable and accrued liabilities of $2,098 as of March 31, 2024 compared to $1,689 as of December 31, 2023. The increase in accounts payable and accrued liabilities was a result of higher debts to suppliers resulting from normal fluctuations in operations.

Accounts payable with related parties

The Company has accounts payable with related parties of $180 as of March 31, 2024 compared to $164 as of December 31, 2023. Accounts payable with related parties remained consistent during the period.

Loan payable and current portion of long-term debt

The Company has current portion of long-term debt of $213 as of March 31, 2024 compared to $213 as of December 31, 2023. Loan payable and current portion of long-term debt remained consistent during the period.

Long term debt

The Company has non-current portion of total long-term debt of $36,855 as of March 31, 2024 compared to $36,259 as of December 31, 2023. The increase in long-term debt is due to an increase in accrued interest.

Summary of Segmented Results of Operations

Cap-Oeste

Cap-Oeste produced a total of 636 gold equivalent ounces (401 ounces of gold and 20,739 ounces of silver) during the three months ended March 31, 2024 compared to 745 gold equivalent ounces (457 ounces of gold and 24,495 ounces of silver) during the same period in 2023.

The cash costs of production for the three months ended March 31, 2024 was $1,491 per ounce1 and $1,508 per ounce1 including depreciation and amortization compared to $2,890 per ounce1 and $2,925 per ounce1 during the same period in 2023. The decrease in cash cost of production per ounce was due to decrease in operating cost resulting from the devaluation of the Argentinian peso in December 2023, this was partially offset by higher inflation in Argentina.

A total of 850 gold equivalent ounces (524 ounces of gold and 28,923 ounces of silver) were sold during the three months ended March 31, 2024 at an average gross price of $2,125 per ounce1. During the same period in 2023, a total of 903 gold equivalent ounces (526 ounces of gold and 31,416 ounces of silver) were sold at an average gross price of $1,913 per ounce1.

1 See Non-IFRS Financial Performance Measures

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Cap-Oeste generated revenues of $1,806 during the three months ended March 31, 2024 compared to $1,727 during the same period in 2023. The increase in revenues was due to the increase in gold price, partially offset by lower amounts of gold equivalent ounces sold during the three months ended March 31, 2024 compared to the same period in 2023.

Cost of sales were $1,632 during the three months ended March 31, 2024 compared to $2,766 during the same period in 2023. The decrease in cost of sales was due to a decrease in operating cost resulting from the devaluation of the Argentinian peso in December 2023, this was partially offset by higher inflation in Argentina. Also, the three months ended March 31, 2023 included an inventory write down of $562 under cost of sales due to the net realizable value of the inventory was less than the costs incurred in establishing the gold held on carbon.

Depreciation, depletion and amortization expenses of $28 were incurred during the three months ended March 31, 2024 compared to $55 during the same period in 2023.

Lomada de Leiva Project ("Lomada")

During the three months ended March 31, 2024, gold and silver production ceased as Lomada commenced closure activities. No further residual production is expected. The heap leach pad is being washed to reduce cyanide levels to the required levels and thereafter closure and remedy activities will commence.

Martha and La Josefina Projects

There was no production at Martha during the three months ended March 31, 2024 as the Company did not produce concentrate from Martha after April 2020. Operations at Martha remain on care and maintenance while the Company continues to explore the property.

Exploration expenses of $122 were incurred during the three months ended March 31, 2024 compared to $415 during the same period in 2023.

The Company incurred repair and maintenance expense of $198 during the three months ended March 31, 2024 compared to $169 during the same period in 2023. The repair and maintenance during the period related to maintenance work at the Mina Martha plant.

Calcatreu Project

Exploration expenses of $81 were incurred during the three months ended March 31, 2024 compared to $214 during the same period in 2023. The decrease in exploration expenses was due to less exploration activities performed during the three months ended March 2024 compared to the same period in 2023.

Administration expenses of $134 were incurred during the three months ended March 31, 2024 compared to $133 during the same period in 2023. Administrative expenses remained consistent during the period.

Argentina, Uruguay and Chile

This segment includes the results from the Company's work on the Monte Leon and Tornado and Huracán projects in Argentina, the San José Project in Uruguay and general corporate activities. This segment does not generate revenues and includes costs that are not directly related to other mining properties that are reported as separate segments.

Exploration expenses of $601 were incurred during the three months ended March 31, 2024 compared to $536 during the same period in 2023. Exploration expenses remained consistent during the period.

Administration expenses of $385 were incurred during the three months ended March 31, 2024 compared to $771 during the same period in 2023. The decrease in administrative expenses was due to lower professional fees, salaries and compensations during the three months ended March 31, 2024.

Interest expense of $232 was incurred during the three months ended March 31, 2024 compared to $100 during the same period in 2023. The increase in interest expense was due to the increase in bank indebtedness with Argentinian banks.

United Kingdom

This segment includes the results of Patagonia Gold Limited ("PGL") (formerly Patagonia Gold PLC) which is a holding company and does not generate any revenues.

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Administration expenses of $4 were incurred during the three months ended March 31, 2024 compared to $42 during the same period in 2023. The administrative expenses relate to professional fees.

Interest expense of $148 was incurred during the three months ended March 31, 2024 compared to $216 during the same period in 2023. The decrease in interest expense was due to a decrease in bank indebtedness balance.

North America

This segment includes the results of Patagonia Gold Corp ("PGC"), Patagonia Gold Canada Inc and 1272680 B.C. Ltd ("BC"). These entities are holding companies and do not generate any revenues.

Administration expenses of $150 was incurred during the three months ended March 31, 2024 compared to $211 during the same period in 2023. Administration expenses consists of accounting and legal fees.

Interest expense of $449 was incurred during the three months ended March 31, 2024 compared to $255 during the same period in 2023. The increase in interest expense was due to an increase in long-term debt balance.

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Mineral Properties

The following is a summary of Patagonia Gold Corporation's ("Patagonia" or the "Company") operations, together with an update on exploration activities for the period to date.

Figure 1. Location of the Company's property groups.

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Calcatreu Property

The Company's Calcatreu property is located in the south-central part of the Rio Negro province approximately 80 kilometers ("km") southwest of the town of Jacobacci (Figure 1). Calcatreu is located in the Jurassic-aged, Somuncura Massif along the NW- to SE- oriented, regional-scale Gastre Fault System; a highly prospective belt of Mesozoic-aged rocks, structures and base and precious metal mineral deposits occurring in both the provinces of Chubut and Rio Negro. The massif is similar in geologic character to the larger Deseado Massif in the province of Santa Cruz to the south. Patagonia has also recently acquired new concessions, bringing its holdings to more than 100,000 hectares ("ha") along this belt in Rio Negro Province, bordering Chubut on the north. Calcatreu is a gold and silver property acquired in January 2018 through the acquisition of Minera Aquiline Argentina SA, a subsidiary of Pan American Silver and the Company's immediate aim is to increase the existing mineral resources and advance Calcatreu to a feasibility study stage. Precious metal mineralization in the Somuncura Massif, like that on the Company's Calcatreu property, is largely epithermal in character within quartz-rich veins, vein clusters, stockworks and as disseminations. Sulfide minerals are ubiquitous in the mineral deposits as well as a suite of temporally- and spatially-related gangue minerals typical of epithermal deposits in the massif and elsewhere.

The Calcatreu deposit is a low sulfidation, epithermal gold and silver system with outcropping mineralization. An independent mineral resource estimate ("MRE") was completed by Micon International Limited of Toronto in 2004 for the Calcatreu Deposit and disclosed in an NI 43-101 technical report for Aquiline Resources Inc. Mineral resources were estimated for two vein systems on the property: Veta 49 and Nelson. In 2018, Cube Consulting Ltd. ("CUBE") of Australia prepared an updated MRE mineral resource estimate for Calcatreu, effective December 31, 2018, which consists of an indicated resource of 9.8 M tonnes grading 2.11 g/t Au and 19.83 g/t Ag (2.36 g/t gold equivalent - "AuEq") and 8.1 M tonnes of inferred grading 1.34 g/t Au and 13.09 g/t Ag (1.5 g/t AuEq); all contained within Veta 49, Nelson, Belen and Castro Sur veins. Gold equivalent values were calculated by CUBE using a metal price at a ratio of 81:25:1 Ag/Au. The changes from the previous estimate were due to a revised interpretation of prior and new data collected by the Company. The 2018 exploration work at Calcatreu consisted of property-scale geological mapping along with a pole-dipole, induced polarization and resistivity (IP/Res) geophysical survey, followed by a diamond drill program of 6,495 meters (please see the table of the Company's mineral resources herein and the respective, supporting NI 43-101 technical reports on file at www.sedarplus.ca). The updated mineral resource estimate, completed by CUBE, is tabulated herein.

In 2019, an exploration program was conducted consisting of surface work, a total of 41.28 line kilometers of pole-dipole induced polarization and resistivity ("IP/Res") geophysical survey conducted over the main Nelson targets and Castro Norte, Fiero, Sabrina and Viuda de Castro areas, and 121.5 line-kilometers of gradient array IP/Res geophysics over Nelson, Sabrina and Mariano. Subsequently, 1,687.2 line kilometers of ground magnetics surveying, covering 55.44 square kilometers, was completed covering several targets including the main V49 and Nelson. The objective of the surveys was to identify hidden, non-outcropping mineralization in dilatational jogs, blind structures and other geologic settings. Geologic mapping and sampling were completed over several targets of interest, notably Viuda de Castro, Trinidad, La Cruz, sporadic outcrops of the Nelson extension, Piche, La Olvidada and Epu Peñi. The sampling yielded 254 rock chips and 81 new, sawed channels. Overall, approximately 50% of the core from the property was relogged, though totalling up to 80% in some areas such as Veta 49 and Belen.

A rotary air blast ("RAB") drilling campaign and channel (sawed) sampling was in progress in early 2020 when all the activities were paused due to the COVID-19 pandemic. The activities restarted in September 2020. A total of 36 RAB holes were drilled over the main V49 vein and 6 over Piche totaling 740 and 116 meters of drilling respectively and a total of 856 samples. Trenches and saw channel: a total of 1,308.7 m and 447 samples were taken over the Epu Peñi, Fiero, La Olvidada, Nelson Sur, Piche and Viuda de Castro targets. Geophysics: A total of 1,111.57 line kilometers of ground magnetic geophysical surveying was completed over the extension of the main targets and the new Amancay area, and 18.4 line kilometers of pole-diploe IP/Res over Trinidad and Nelson Targets. In December 2020, a baseline environmental study (the "Baseline Study") began by choosing the contractors and reviewing the information generated in the past. The Baseline Study aims to contextualize the environmental state before the construction and production of the project begins.

In 2021, work on the Baseline Study continued with field work, along with drilling, surface exploration and geophysics. RAB drilling was also conducted to obtain information from near surface on the up-dip extension of mineralization in the main structures (Veta 49 and Nelson). A total of 156 holes were drilled for a total of 1,708 meters ("m") and 1,708 samples (one per meter) collected which included 15 holes in the Belen prospect (156 m), 51 holes at Nelson (528 m), 21 holes in Nelson Oeste (241 m) and 69 holes in the Vein 49 target (783 m). 146.75 m and 196 sawed channel samples have been cut in Nelson Central, Nelson W and Puesto targets. In addition, a total of 3,730.35 m of trenches and 2,223 samples have been excavated and sampled with 50% of them in Nelson and its brunches aimed to understand the behavior of the veins in the southern extreme. A total of 901.5 line kilometers of ground magnetics has been surveyed over the main prospects and their southern extensions. Additionally, 31.8 line kilometers of Pole-Dipole IP/Res have been completed in several short section over the main veins and their extensions.

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During 2022, a total of 1,759.4 line kilometers of ground magnetics were surveyed and 66.25 line kilometers of Pole-Dipole IP/Res over the main prospects and their extensions, eleven trenches were cut for a total of 292.5 meters and 226 samples were taken. In November 2022, several meetings were held with different stakeholders of the Ingeniero Jacobacci community which were open to the general public, including the Peñi Mapu local indigenous community. In that same month, a presentation to the Mining Chamber of Rio Negro province was made in the city of General Roca.

During 2023, geophysical surveying continued while the Company awaited the final permits from the provincial authorities. A total of

856.7 line kilometers of ground magnetics was surveyed trying to identify new exploration targets, and 11 line kilometers of Pole-Dipole IP/Res over the Mojon Grande, Mojon and Guzman targets was also completed.

There were no exploration activities during the first quarter of 2024. The environmental permitting is expected to be completed in the second quarter and to start with geomechanics labors in the future pad zone.

Cap-Oeste Property

The Company's Cap-Oeste ('Capo") property is located in the El Tranquilo concession block (Figure 2), in the province of Santa Cruz, within a six kilometer long, northwest-trending, structural corridor extending from the La Pampa prospect in the northwest to the Tango prospect in the southeast. Within this trend, the Capo deposit has an identified and delineated strike extent of 1.2 kilometers. Capo has been on care and maintenance since February 2019 though residual leaching and exploration activities continue.

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Figure 2. El Tranquilo Concession Block (left) and MLN detail (right)

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