EverGen Infrastructure : Q2 2022 Management Discussion and Analysis

Management's Discussion and Analysis

For the three and six months ended June 30, 2022

Dated August 23, 2022

EverGen Infrastructure Corp. Management's Discussion and Analysis

All amounts in Canadian $000s, unless otherwise indicated

FINANCIAL AND OPERATIONAL HIGHLIGHTS SUMMARY

Core RNG expansion and development projects: EverGen continues to progress on its core RNG expansion and development projects.

Fraser Valley Biogas

Construction at the Fraser Valley Biogas core RNG expansion project is expected to commence in late- Q3 2022, for an anticipated cost of $13-$15million, with completion scheduled for Q1 2023. The project is expected to double the capacity of the facility to ~160,000 gigajoules of RNG per year.

Net Zero Waste Abbotsford

The core RNG expansion project at Net Zero Waste Abbotsford is expected to increase the facility's inbound organic feedstock to ~135,000 tonnes per year, from 40,000 tonnes per year, and add RNG production of ~180,000 gigajoules per year. The project is expected to cost $32-$35million and is anticipated to commence construction in mid-2023,following the receipt of regulatory approvals.

GrowTEC

In July 2022, EverGen completed the acquisition of a 67% interest in GrowTEC, which is currently in the first phase of a core RNG expansion project designed to produce ~80,000 gigajoules of RNG per year and is expected to be completed in Q4 2022. The facility will then move into the second phase of the project, which is expected to produce a total of ~140,000 gigajoules of RNG per year.

Project Radius

In May 2022, EverGen acquired a 50% interest in Project Radius, which is a late-development-stage portfolio of three high-quality,on-farm RNG projects, collectively capable of producing ~1.7 million gigajoules of RNG per year and are expected to be constructed throughout 2023 and 2024.

Financing: In August 2022, EverGen announced the signing of a term sheet for a $31 million senior term loan to support the funding of its near-term core RNG expansion projects at Fraser Valley Biogas and Net Zero Waste Abbotsford.

Cash and cash equivalents: Cash and cash equivalents increased 377%, or $13.7 million, to $17.4 million as at June 30, 2022, compared to June 30, 2021. Combined with the expected $31 million debt facility announced in August 2022, this fully-funds EverGen's core RNG expansion projects.

Revenue: For the three and six months ended June 30, 2022, revenue of $2,359 and $3,786 decreased compared to the same periods last year. These decreases were mainly driven by lower volumes of incoming organic feedstock and seasonal impacts on organic compost and soil sales.

In August 2022, EverGen received confirmation from its insurers of the approval of an additional $1.5 million of partial insurance proceeds, of which a significant portion of this amount will be included in Net income (loss) and Adjusted EBITDA for Q3 2022.

Net income (loss): For the three months ended June 30, 2022, net income (loss) of ($546) increased $371, compared to the same period last year. The increase was mainly driven by lower revenues, as described above, and an increase in flood-related costs, partially offset by the recognition of insurance proceeds and the absence of a contingent consideration loss.

For the six months ended June 30, 2022, net income (loss) of ($765) decreased $568, compared to the same period last year. The decrease was mainly driven by the recognition of insurance proceeds for flood- related lost revenues and expenditures incurred in late-2021.

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EverGen Infrastructure Corp. Management's Discussion and Analysis

All amounts in Canadian $000s, unless otherwise indicated

During the three and six months ended June 30, 2022, the Federal Government of Canada enacted tax legislation reducing the corporate income tax rate for qualifying zero-emission technology manufacturers by 7.5% and allows for the accelerated recognition of the capital cost allowance for eligible equipment, which EverGen expects both tax relief initiatives will apply to its core RNG expansion and development projects.

Adjusted EBITDA: For the three months ended June 30, 2022, EverGen recorded adjusted EBITDA of $426. Adjusted EBITDA continues to be impacted from the floods in late-2021 and EverGen estimates that $1.0 million of flood-related lost revenue and expenditures were incurred during this period.

For the six months ended June 30, 2022, EverGen recorded adjusted EBITDA of $1,057. EverGen estimates that $1.7 million of flood-related lost revenue and expenditures were incurred during this period.

RNG Volumes: RNG volumes commenced on April 16, 2021, upon the acquisition of FVB. RNG volumes were impacted during the first quarter of 2022 as a direct result of flooding events in the Abbotsford and Sumas Prairie regions, which resulted in the shut down of the FVB facility on November 15, 2021, until operations were restored. Since March 2, 2022, FVB has been operating and producing daily volumes of up to 334 GJ/d, restoring production volumes to historical levels.

		Three months ended			Six months ended
	June	June			June	June
	30,	30,	$	%	30,	30,	$	%
	2022	2021	Change	Change	2022	2021	Change	Change
FINANCIAL
Revenue)	2,359	3,349	(990)	(30)	3,786	4,934	(1,148)	(23)
Net income (loss)	(546)	(175)	(371)	212	(765)	(1,333)	568	(43)
Net income (loss) per share
($), basic and diluted	(0.04)	(0.02)	(0.02)	100	(0.06)	(0.14)	0.08	(57)
EBITDA (1)	(154)	454	(608)	(134)	327	(506)	833	(165)
Adjusted EBITDA (1)	426	1,863	(1,437)	(77)	1,057	2,066	(1,009)	(49)
Capital expenditures (2)	2,349	10,812	(8,463)	(78)	3,704	10,958	(7,254)	(66)
Total assets	78,581	64,961	13,620	21	78,581	64,961	13,620	21
Total long-term liabilities	14,453	15,460	(1,007)	(7)	14,453	15,460	(1,007)	(7)
Cash and cash equivalents	17,379	3,647	13,732	377	17,379	3,647	13,732	377
Working capital surplus	16,524	2,310	14,214	615	16,524	2,310	14,214	615
COMMON SHARES
(thousands)
Outstanding, end of period	13,307	10,287	3,020	29	13,307	10,287	3,020	29
Weighted average - basic
and diluted	13,357	9,819	3,538	36	13,362	9,222	4,140	45
OPERATING
Incoming organic feedstock
(tonnes)	24,336	30,467	(6,131)	(20)	40,383	47,631	(7,248)	(15)
Organic compost and soil
sales (yards) (3)	13,778	37,053	(23,275)	(63)	19,178	44,140	(24,962)	(57)
RNG (gigajoules)	20,254	18,845	1,409	7	26,026	18,845	7,181	38

1. Non-GAAPmeasure as defined in the Non-GAAP measures section of this MD&A.
2. Capital expenditures for the three and six months ended June 30, 2022 includes a $1,000 initial investment in an equity-accounted investment (Project Radius).
3. Organic compost and soil sales includes both finished and unfinished product sales and by-products.

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EverGen Infrastructure Corp. Management's Discussion and Analysis

All amounts in Canadian $000s, unless otherwise indicated

BASIS OF PRESENTATION

EverGen Infrastructure Corp. ("EverGen", "the Company", "we", "our", "us" or "its") has prepared the following Management's Discussion and Analysis ("MD&A") for the three and six months ended June 30, 2022, in accordance with National Instrument 51-102F1, and should be read in conjunction with the Company's unaudited interim condensed consolidated financial statements for the three and six months ended June 30, 2022, which have been prepared in accordance with International Accounting Standard 34, Interim Financial Reporting, using accounting policies consistent with International Financial Reporting Standards as issued by the International Accounting Standards Board ("IFRS"), and the audited consolidated financial statements for the year ended December 31, 2021. All references to "$" are references to Canadian dollars and all amounts are presented in thousands of dollars, unless otherwise indicated. This MD&A and the unaudited interim consolidated financial statements of EverGen have been prepared by management and approved by the Audit Committee of the Board of Directors as of August 23, 2022.

Additional information relating to the Company, including our Annual Information Form dated January 31, 2022 ("AIF"), is available on SEDAR at www.sedar.comThe Company's common shares trade on the TSX Venture Exchange ("TSXV") under the symbol "EVGN" and the OTCQB Venture Market ("OTCQB") under the symbol "EVGIF".

READER ADVISORIES

This MD&A contains certain "forward-looking statements" within the meaning of Canadian securities legislation and introduces financial measures which are not defined under IFRS aimed at helping the reader in making comparisons to metrics similarly disclosed by industry peers. Readers are cautioned that the MD&A should be read in conjunction with the Company's disclosure under "Non-GAAP Measures" and "Forward-Looking Information" included at the end of this MD&A.

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EverGen Infrastructure Corp. Management's Discussion and Analysis

All amounts in Canadian $000s, unless otherwise indicated

COMPANY OVERVIEW AND STRATEGY

EverGen, headquartered in Vancouver, British Columbia is a sustainable infrastructure platform established to acquire, develop, build, own and operate a portfolio of renewable natural gas ("RNG"), waste to energy, and related infrastructure projects in Canada and other regions of North America.

EverGen commenced operations upon incorporation on May 13, 2020.

The Company operates four facilities through its subsidiaries: Net Zero Waste Abbotsford Inc. ("NZWA"), Sea to Sky Soils and Composting Inc. ("SSS"), Fraser Valley Biogas Ltd. ("FVB") and Grow the Energy Circle Ltd. ("GrowTEC") (67% interest in GrowTEC acquired in July 2022), and during Q2 2022 EverGen acquired a 50% interest in Project Radius.

FVB is British Columbia's original RNG facility, which sells RNG under a long-term contract with FortisBC and combines anaerobic digestion and biogas upgrading to produce RNG, primarily by converting agricultural waste from local dairy farms. The FVB RNG facility is currently undergoing a core RNG expansion project to add additional RNG production that is expected to double the facility's existing capacity and increase RNG production to ~160,000 gigajoules per year. The capital costs for this project are anticipated to be $13-15 million, with construction beginning in late Q3-2022, and with anticipated completion in Q1 2023.

NZWA and SSS are currently organic waste conversion facilities in British Columbia, owned and operated by EverGen, which primarily processes inbound organics, yard waste and biosolids for a contracted tipping fee and produces high-quality organic compost and soils for farmers, gardeners and developers. NZWA is also undergoing a planned core RNG expansion project, which will add anaerobic digestion capabilities to produce biogas and will then be upgraded to RNG to feed into FortisBC's gas network under an existing 20-yearoff-take agreement. The expansion is expected to increase the facility's inbound organics throughput to ~135,000 tonnes of feedstock per year and is designed to produce ~180,000 gigajoules of RNG per year. Capital costs for this project are anticipated to be $32-35 million. Construction of the upgrade will begin upon receipt of building and regulatory approvals, for which applications were submitted earlier in 2022. Construction on the project is expected to begin in mid-2023, with anticipated completion in early- 2024. Pursuant to this project, EverGen is also investing in environmental upgrades to ensure the readiness of the facility for increased volumes of inbound organics. The majority of the revenue currently earned by the composting operations is sourced under long-term contracts with local municipalities.

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