CGX Energy : MD&A and Financials for year end - December 31, 2020

MANAGEMENT'S DISCUSSION AND ANALYSIS

OF FINANCIAL CONDITION AND RESULTS OF OPERATION

Three month period and year ended December 31, 2020

This management's discussion and analysis ("MD&A") is current to March 18, 2021 and is management's assessment of the operations and the financial results of CGX Energy Inc. ("CGX" or the "Company"). All figures are in United States dollars, unless otherwise stated. This MD&A should be read in conjunction with the Company's audited consolidated financial statements and the related notes for the years ended December 31, 2020 and 2019.

Unless indicated otherwise, all financial data in this MD&A has been prepared in accordance with International Financial Reporting Standards ("IFRS") issued by the International Accounting Standards Board ("IASB") and interpretations of the International Financial Reporting Interpretations Committee ("IFRIC").

Additional information relevant to the Company's activities can be found on SEDAR atwww.sedar.comor the Company's website atwww.cgxenergy.com.

Forward-Looking Statements

This MD&A contains forward-looking statements that are not historical in nature and involve risks and uncertainties. Forward-looking statements are not guarantees as to CGX's future results as there are inherent difficulties in predicting future results. Accordingly, actual results could differ materially from those expressed or implied in the forward-looking statements.

This MD&A contain certain statements or disclosures relating to the Company that are based on the expectations of its management as well as assumptions made by and information currently available to the Company which may constitute forward-looking statements or information ("forward-looking statements") under applicable securities laws. All such statements and disclosures, other than those of historical fact, which address activities, events, outcomes, results or developments that the Company anticipates or expects may, or will occur in the future (in whole or in part) should be considered forward-looking statements. In some cases, forward-looking statements can be identified by the use of the words "assume", "believe", "continue", "estimate", "expect", "forward", "future", "lead", "may", "plan", "potential", "prospect", "will", "would" and other similar words suggesting future outcomes or statements regarding an outlook.

In particular, but without limiting the foregoing, this MD&A contains forward-looking statements pertaining to the following: the Company's exploration and development activities; expenditures; infrastructure projects, including road refurbishment and the Port and Logistics Yard (each as defined herein); the Company's leads and drilling prospects in respect of its various oil and natural gas interests; governmental and regulatory approvals and agreements; global coronavirus pandemic ("COVID-19"); trends in financial and commodities markets; the Company's future performance, operations, liquidity and financial condition, including its ability to continue as a going concern; and the scope, duration, and reoccurrence of any epidemics or pandemics (including specifically the coronavirus disease 2019 (COVID-19) pandemic) and the actions taken by third parties, including, but not limited to, governmental authorities, contractors, and suppliers, in response to such epidemics or pandemics.

In addition, statements relating to resources are deemed to be forward-looking statements as they involve the implied assessment, based on certain estimates and assumptions, that the resources described exist in the quantities predicted or estimated and can be profitably produced in the future.

The forward-looking statements contained in this MD&A reflect several material factors and expectations and assumptions of the Company including, without limitation: prevailing and future commodity prices andcurrency exchange rates; applicable royalty rates and tax laws; interest rates; future well production rates and reserve volumes; operating costs, the timing of receipt of regulatory approvals; success obtained in exploration, development and production activities; anticipated timing and results of capital expenditures; the sufficiency of budgeted capital expenditures in carrying out planned activities; the timing, location and extent of future drilling operations; the state of the global, Guyanese, Surinamese and other economies; the state of the oil and natural gas exploration and production industry; the availability and cost of financing, labour and services; and ability to market crude oil and natural gas.

In particular, except where otherwise stated, the Company has assumed a continuation of existing business operations on substantially the same basis as exists at the time of filing of this MD&A.

The Company believes the material factors, expectations and assumptions reflected in the forward-looking statements are reasonable at this time but no assurance can be given that these factors, expectations and assumptions will prove to be correct. The forward-looking statements included in this MD&A are not guarantees of future performance and should not be unduly relied upon. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements including, without limitation: risks associated with the onshore and offshore oil and natural gas industry in general such as operational risks in development, exploration and production; risks associated with international operations; delays or changes in plans with respect to exploration or development projects or capital expenditures; uncertainty of estimates and projections relating to reserves, resources, production, revenues, costs and expenses; risks associated with the construction, development and operations of a deep water port; health, safety and environmental risks; commodity price and exchange rate fluctuations; interest rate fluctuations; marketing and transportation; environmental risks; competition; incorrect assessment of the value of acquisitions; ability to access sufficient capital from internal and external sources; failure to obtain required regulatory and other approvals; changes in legislation, including but not limited to tax laws, royalties and environmental regulations; and the effects and impacts of the COVID-19 pandemic as further described herein and supply conflicts among the Organization of Petroleum Exporting Countries and other oil producing countries over production restrictions which impact crude oil prices, the extent and duration of which are uncertain at this time, on the Company's business, general economic and business conditions and markets.

The forward-looking statements contained in this MD&A are made as of the date hereof and the Company undertakes no obligations to update publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

Readers are cautioned that the foregoing lists of risks, uncertainties and other factors are not exhaustive. The forward-looking statements contained in this MD&A are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements contained in this document or in any other documents filed with Canadian securities regulatory authorities, whether as a result of new information, future events or otherwise, except in accordance with applicable securities laws. The forward-looking statements contained in this document are expressly qualified by this advisory statement.

Boe Conversion

The term "boe" is used in this MD&A. Boe may be misleading, particularly if used in isolation. A boe conversion ratio of cubic feet to barrels is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. In this MD&A we have expressed boe using the conversion standard of 6.0 Mcf: 1 bbl.

For further information regarding the presentation of the Company's resource disclosure, please see "Resource Definitions" herein.

OVERVIEW

Company Profile

CGX is an oil and gas exploration company headquartered in Toronto, Canada. CGX was incorporated in 1998 for the primary purpose of exploring for hydrocarbons in Guyana, South America. CGX through its subsidiaries holds an interest in three Petroleum Prospecting Licences ("PPLs") and related Petroleum Agreements ("PAs") (known as the Corentyne, Berbice and Demerara Blocks) and a deep water harbor project in Guyana. Upon approval of the Company's proposed relinquishments discussed below, the PPLs will cover approximately 8,138.0 km2 (approximately 5,311,6 net km2) offshore and onshore Guyana.

CGX has four direct subsidiaries: (i) CGX Resources Inc. ("CRI")., a wholly-owned subsidiary, which is incorporated pursuant to the laws of Bahamas; (ii) ON Energy Inc. ("ON Energy"), a corporation subsisting under the laws of Guyana, 62% of the voting shares of which are owned by CGX; (iii) GCIE Holdings Limited ("GCIE"), a wholly-owned subsidiary, which is incorporated pursuant to the laws of Barbados and owns 100% of the shares of Grand Canal Industrial Estates Inc. ("Grand Canal"), a corporation subsisting under the laws of Guyana; and (iv) CGX Energy Management Corp. ("CGMC"), a wholly owned subsidiary, which is incorporated pursuant to the laws of the State of Delaware, USA.

Recent Highlights

Highlights of the recent activities to date of the Company and its subsidiaries include the following:

•  In February 2021, CRI received an addendum to the Demerara PA, subject to final documentation, extending the February 12, 2021 deadline for drilling an exploration well on the Demerara block to no later than February 11, 2022.

•  In February 2021, ON Energy received an addendum to the Berbice PA, subject to final documentation, constituting an extension and modification to the workplan on the Berbice block, from completing a seismic program by August 12, 2021 to completing a seismic program and commencement of drilling an exploration well no later than June 15, 2022.

•  In November 2020, CRI received an addendum to the Corentyne PA extending the November 27, 2020 deadline for drilling an exploration well on the Corentyne block to no later than November 26, 2021.

•  CRI as Operator of the Corentyne and Demerara blocks, contracted McDaniel and Associates Consultants Ltd. ("McDaniel"), an independent qualified reserves evaluator, on September 10, 2020 to complete an independent Prospective Resource study and report (the "Resource Report") in respect of the Corentyne North Area, Corentyne Main Area and Demerara Block. The Resource Report was prepared as of August 31, 2020 in accordance with the resource definitions and standards set out in National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities ("NI 51-101") and the Canadian Oil and Gas Evaluation Handbook ("COGEH").

  A total of 32 prospects have been identified in both blocks (5 in the Demerara block and 27 in the Corentyne block) with CRI's Net Prospective Resources mean volume of 4,940 MMboe unrisked and 884 MMboe risked.

The independent external Resource Report was completed on October 21, 2020 and certain information contained in the Resource Report related to CRI's Net Prospective Resources is summarized below:

CRI's Working Interest Prospective ResourcesProduct by Block/Area (4)(5)

Unrisked (1)(2)

Risked ResourcesWI, %LowMedianMeanHigh

Mean (3)Sub-Total Corentyne North Area

Crude Oil, MbblNatural Gas, MMcfCondensate, Mbbl

• 66.667% 822,253

• 66.667% 1,799,515

• 66.667% 58,260

  1,869,504 4,013,660 143,657

  2,240,604 4,749,552 176,935

  • 4,153,754 396,141

  • 8,680,777 1,000,776

  339,980

  41,697

  Barrel of Oil Equivalent, Mboe (6)

  1,180,432

  2,682,105

  3,209,130 5,940,530 604,634

  Sub-Total Corentyne Main Area

  Crude Oil, MbblNatural Gas, MMcfCondensate, Mbbl

• 66.667% 76,820

328,187

500,251

1,153,101 86,703

66.667% 66.667%

• 611,173 2,109,047

2,993,385 6,554,714 401,008

38,495

• 141,307 210,048

  473,256 26,719

  Barrel of Oil Equivalent, Mboe (6)

  217,177

• 821,001 1,209,196

2,718,809 180,257

Sub-Total Demerara BlockCrude Oil, Mbbl

Natural Gas, MMcfCondensate, Mbbl

66.667% 66.667% 66.667%

126,933 136,849 0

359,434 397,947 0

438,962 500,033 0

857,028 83,347999,333 95,213

0

0

Barrel of Oil Equivalent, Mboe (6)

149,741

425,759

522,301

1,023,583 99,216

Total Prospective Resources, Mboe (6)

1,547,350

3,928,865

4,940,628 9,682,922 884,106

Notes:

1) There is no certainty that any portion of the resources will be discovered. If discovered, there is no certainty that it will be commercially viable to produce any portion of the resources.

(2) The Unrisked Total is not representative of the Portfolio Unrisked Total and is provided to give an indication of the resources range assuming all of the prospects are successful.

(3) All of the prospective resources assigned as part of this assessment have been estimated probabilistically as this is the most appropriate method given the high degree of uncertainty in the various input parameters. Distributions of the various reservoir and fluid parameters were determined, based on parameters from existing wells/discoveries in the area or general worldwide data, and probabilistic calculations of the unrisked OOIP/original gas-in-place ("OGIP") and recoverable resources were prepared for each prospect.

(4) The risked resources have been risked for chance of discovery and chance of development. The chance of development is defined as the probability of a project being commercially viable. Quantifying the chance of development requires consideration of both economic contingencies and other contingencies, such as legal, regulatory, market access, political, social license, internal and external approvals and commitment to project finance and development timing. As many of these factors are extremely difficult to quantify, the chance of development is uncertain and must be used with caution.

(5) McDaniel has determined that the chance of discovery is estimated to be between 18% and 51% and the chance of development between 50% and 70%, based on an evaluation of the risks relevant to the blocks.

(6) Sub-Total and Total are based on the probabilistic aggregation of zones within a prospect and arithmetic aggregation of the individual prospects to the Sub-Total and Total level.

• (7) Volumes listed are full life volumes, prior to any cut-offs due to economics.

• (8) Based on a Mcf to BOE conversion of 6 to 1.

  Resource Definitions

  Resource definitions, including those set out below, are as specified by NI 51-101, and the COGEH.

  "Resources" encompasses all petroleum quantities that originally existed on or within the earth's crust