Artemis Gold : MD&A for December 31, 2020

MANAGEMENT DISCUSSION AND ANALYSIS

For the year ended December 31, 2020

ARTEMIS GOLD INC.

Dated March 30, 2021

ARTEMIS GOLD INC.

Management's Discussion and Analysis of Financial Condition and Results of Operations For the year ended December 31, 2020

1. GENERAL
   This management's discussion and analysis ("MD&A") is management's interpretation of the results and financial condition of Artemis Gold Inc. ("Artemis" or the "Company") for the year ended December 31, 2020 and includes events up to the date of this MD&A. This discussion should be read in conjunction with the annual audited financial statements for the year ended December 31, 2020 and the related notes thereto of the Company (the "Annual Financial Statements") and other corporate filings of the Company, including its most recently filed Annual Information Form ("AIF"), all of which are available under the Company's profile on SEDAR at www.sedar.com. Unless otherwise specified, all financial information has been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board. All dollar figures stated herein are expressed in Canadian dollars, unless otherwise specified. This MD&A contains forward-looking information. Please see the section, "Note Regarding Forward-Looking Information" for a discussion of the risks, uncertainties and assumptions used to develop the Company's forward-looking information.
2. TECHNICAL INFORMATION
   All scientific and technical information herein related to the Blackwater Gold Project located in central British Columbia (the "Blackwater Project" or "Blackwater") has been reviewed and approved by Mr. Jeremy Langford, FAusIMM., who is a qualified person for the purposes of National Instrument 43-101Standards of Disclosure for Mineral Projects ("NI 43-101"). For additional information regarding the Blackwater Project, please see the Company's news release dated August 26, 2020, as well as the Company's technical report entitled "Blackwater Gold Project British Columbia NI 43-101 Technical Report" dated September 18, 2020 (with an effective date of August 26, 2020) (the "2020 PFS"), both available on the Company's profile at www.sedar.com. Further details regarding the qualified person's data verification procedures are included in the Company's news releases dated December 7, 2020 and March 1, 2021, respectively, available on the Company's profile at www.sedar.com.
   All scientific and technical information herein related to Velocity Minerals Ltd. ("Velocity" or "VLC") has been reviewed, approved and prepared by Mr. Stuart Mills, a qualified person for the purposes of NI 43-101. For additional information regarding the Rozino Pre-Feasibility Study, including its quality assurance and quality control procedures, please see the technical report dated effective October 14, 2020 on VLC's profile on SEDAR at www.sedar.com.
3. BACKGROUND
   Artemis was incorporated on January 10, 2019 pursuant to the Business Corporations Act (British Columbia) under the name 1193490 B.C. Ltd. Artemis was incorporated as a wholly-owned subsidiary of Atlantic Gold Corporation ("Atlantic") for the purpose of acquiring gold mineral exploration properties.
   On May 14, 2019, Atlantic announced that it had entered into an arrangement agreement with St Barbara Limited ("St Barbara") pursuant to which St Barbara would acquire 100% of all issued and outstanding shares of Atlantic (the "Arrangement"). As part of the Arrangement, Atlantic agreed to distribute 100% of the common shares of Artemis to Atlantic shareholders on the effective date. The Arrangement closed on July 19, 2019.
   On July 18, 2019, the Company's common shares were split on the basis of approximately 1.302 post subdivided shares for every pre subdivided share. All common share, and per share amounts in the financial statements and this MD&A have been retrospectively restated to present post subdivision amounts.

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ARTEMIS GOLD INC.

Management's Discussion and Analysis of Financial Condition and Results of Operations For the year ended December 31, 2020

On October 2, 2019, Artemis' common shares commenced trading on the TSX Venture Exchange (the "TSXV").

On August 21, 2020, the Company completed the acquisition of the Blackwater Project from New Gold Inc.

("New Gold").

The Company also holds a 32% equity interest in Velocity (22% as at December 31, 2020). VLC is in the business of acquiring, exploring, and evaluating mineral resource properties in Bulgaria and its flagship project is the Rozino Project. Velocity's common shares are traded on the TSXV under the symbol "VLC".

4. HIGHLIGHTS AND KEY BUSINESS DEVELOPMENTS Corporate highlights since the prior quarter

• The Company continued its work towards de-risking the Blackwater Project by:
• • Executing a 33,216-metre grade control drill program, the results of which will inform mine planning for the initial years of mining;
  • Publishing the results of an Economic Impact Study, demonstrating the potential to be a new economic engine contributing to the local, provincial and national economy for more than 25 years;
  • Continuing metallurgical test work to complement the findings of the 2020 PFS, returning average recoveries in excess of the 93% recovery rate stated in the 2020 PFS;
  • Executing site investigation work, including geotechnical drilling at the proposed tailings storage facility (the "TSF") and plant site;
  • Continuing negotiations with indigenous nations;
  • Submitting an application to the government of British Columbia for permits for early construction works, as well as documents required to amend Blackwater's Schedule 2 of the Metal and Diamond Mining Effluent Regulations ("MDMER") for mine waste disposal; and
  • Executing a memorandum of understanding ("MOU") with Ausenco Engineering Canada Inc. ("Ausenco") based on a guaranteed maximum price ("GMP") for a fixed-price Engineering, Procurement and Construction ("EPC") contract to construct a 5.5 million tonne per annum processing facility and associated infrastructure.
• The Company strengthened its management team through the appointment of Mr. Jeremy Langford as Chief Operating Officer, Ms. Candice Alderson as Senior Vice President Corporate Affairs and Mr. Gerrie van der Westhuizen as Vice President Finance.
• On March 25, 2021, the Company converted its convertible debenture in VLC (in the amount of $5,302,784, including accrued interest) at a conversion price of $0.25/share for a total of 21,211,136 additional common shares of VLC. This brought the Company's position to 32% of VLC's issued and outstanding common shares (up from 22% as of December 31, 2020).

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ARTEMIS GOLD INC.

Management's Discussion and Analysis of Financial Condition and Results of Operations For the year ended December 31, 2020

5. DEVELOPMENT OF BLACKWATER Key milestones achieved

Since October 1, 2020, the Company has completed the following activities to reduce the project execution risk associated with Blackwater:

1. Conducted an Economic Impact Study
   The Company engaged KPMG to produce an Economic Impact Study (the "Study") to be used to measure the updated economic benefits of the staged approach to the development of the Blackwater Project. The Study focused on job creation, fiscal revenues, and overall economic wealth creation for the regions within and surrounding the Blackwater Project, the Province and for Canada. The statistics produced in the Study were based on the base case scenario of the three-phase development of Blackwater, as reported in the Company's 2020 PFS, over a minimum 23-year life of mine ("LOM").
   The base case assumed:
2. • Initial development capital of $592 million to build a 5.5 million tonne per annum ("Mtpa") mine (years 1-5)
   • $426 million in capital costs to expand to 12Mtpa (years 6-10)
   • $398 million in capital costs to expand to 20Mtpa (years 11-23)

The selected B.C. regions within the Study included the Bulkley-Nechako,Fraser-Fort George and Cariboo. With a total capital investment of $1.4 billion (initial and expansion capital), Blackwater would be one of the largest capital investments for the region in the last ten years. The tables below provide a summary of the expected economic impact on the province:

Table 1: Summary of expected total economic impact (direct, indirect and induced) on British Columbia stemming from construction and operating activities of the Blackwater Mining Project1

Over the LOM, in M$ and person-years, total and annual average

British Columbia	Total	Annual Average2

Overall construction activities are expected to last 5 years (2 years initial phase followed by 2 expansion phases (15-18months each)

Operating phase is expected to last for 23 years

	Value added (in millions of dollars)	13,234		-
	Construction2	810	162
		(over 5 years)
	Operations	12,424	540
		(over 23 years)

Note: Due to rounding, the sum of items may not add up to the total.

Source: Simulations of B.C. Stat based on data from Artemis, KPMG analysis

1. Total impact includes direct, indirect and induced effects.
2. For construction, Artemis assumed that the overall project, including initial phase and the 2 expansion phases, would take 60 months or 5 years, therefore, results may vary depending on the exact length of each phase. Also includes closure costs.

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ARTEMIS GOLD INC.

Management's Discussion and Analysis of Financial Condition and Results of Operations For the year ended December 31, 2020

Table 2: Expected value-added and jobs stemming from the construction1 and operation of the Blackwater Project in British Columbia

	Direct	Indirect	Induced
British Columbia	Effects	Effects	Effects	Total
In millions of dollars
Total value added during construction1	485	221	104	810
Value added per year during operations	419	100	21	540
In Full Time Equivalent
Jobs per year over 5 years of construction1	825	453	222	1,499
Jobs per year during operations	457	698	211	1,366

Note: Due to rounding, the sum of items may not add up to the total.

Source: Simulations of B.C. Stat based on data from Artemis; KPMG analysis

The Blackwater Project is expected to generate a total of $73 million of municipal government revenue, $2.3 billion of provincial government revenue and $1.5 billion of federal government revenue over the LOM.

1. Filing of applications for early construction works
   The Company submitted applications to the B.C. government to undertake an early works construction program, which is designed to focus on clearing of key infrastructure areas including haul roads, the stage 1 tailing storage facility and camp areas. In addition, construction of the mine access road and plant-site bulk earthworks are expected to be fast-tracked to facilitate early mobilization of an EPC contractor to site upon receipt of major works permits.
2. Award of GMP
   Following a competitive bidding process involving a number of GMP proposals from engineering firms, the Company entered into an MOU with Ausenco. This was based on Ausenco's proposal to engineer and construct the processing facility and associated infrastructure for a GMP of $236 million, subject to any technical or commercial changes that may be requested by Artemis. Ausenco has already undertaken a significant amount of detailed engineering work and will progress work towards concluding a fixed-price EPC contract on an "open-book" basis, which is expected to mitigate the potential for capital cost and schedule overruns. The GMP for the processing facility covers a number of construction packages, including site development, the process plant and ore crushing circuit, on-site infrastructure, as well as engineering and project management. A fixed price EPC contract on the processing facility and associated infrastructure represents by far the largest single component of the capital cost of Blackwater at approximately 40% of the 2020 PFS estimate.
   The Company is also conducting a competitive bidding process for a GMP proposal in connection with a fixed-price EPC contract for the construction of the electricity transmission line and associated offsite infrastructure for Blackwater, which is expected to be awarded in Q2 2021.

1 For construction, Artemis assumed that the overall project, including initial phase and the 2 expansion phases, would take 60 months or 5 years, therefore, results may vary depending on the exact length of each phase. Also includes closure costs.

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