Gowest Gold : Earnings Document

GOWEST GOLD LTD.

MANAGEMENT'S DISCUSSION AND ANALYSIS

FOR THE NINE MONTHS ENDED JULY 31, 2021

This management discussion and analysis ("MD&A") of the financial condition and results of operations of Gowest Gold Ltd. ("Gowest" or the "Company") describes the operating and financial results of the Company for the three and nine months ended July 31, 2021. This MD&A has been prepared in compliance with the requirements of National Instrument 51-102 - Continuous Disclosure Obligations. The MD&A supplements but does not form part of the financial statements of the Company and should be read in conjunction with Gowest's audited financial statements for the years ended October 31, 2020 and 2019, together with the notes thereto. The Company prepares and files its financial statements in accordance with International Financial Reporting Standards ("IFRS"). All amounts are stated in Canadian dollars unless otherwise noted and gold is measured in fine troy ounces ("ounces").

Forward-looking Statements

This MD&A contains certain forward-looking information and forward-looking statements, as defined in applicable securities laws (collectively referred to herein as "forward-looking statements"). These statements relate to future events or the Company's future performance. All statements other than statements of historical fact are forward-looking statements. Often, but not always, forward-looking statements 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. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from those anticipated in such forward-looking statements. The forward-looking statements in this MD&A speak only as of the date of this MD&A or as of the date specified in such statement. Specifically, this MD&A includes, but is not limited to, forward-looking statements regarding: the potential of Gowest's properties to contain economic precious and base metal deposits; the Company's ability to meet its working capital needs for the next twelve-month period, or the foreseeable future; the plans, costs, timing and capital for future exploration and evaluation of Gowest's property interests, including the costs and potential impact of complying with existing and proposed laws and regulations; management's outlook regarding future trends; sensitivity analysis on financial instruments, which may vary from amounts disclosed; prices and price volatility for precious and base metals; and general business and economic conditions.

Inherent in forward-looking statements are risks, uncertainties and other factors beyond Gowest's ability to predict or control. These risks, uncertainties and other factors include, but are not limited to, precious and base metal deposits, price volatility, changes in debt and equity markets, timing and availability of external financing on acceptable terms, the uncertainties involved in interpreting geological data and confirming title to the Company's properties, the possibility that future exploration results will not be consistent with Gowest's expectations, increases in costs, environmental compliance and changes in environmental and other local legislation and regulation, interest rate and exchange rate fluctuations, changes in economic and political conditions and other risks involved in the precious and base metal exploration and evaluation

• as well as those risk factors listed in the "Risks and Uncertainties" section below. Readers are cautioned that the foregoing list of factors is not exhaustive of the factors that may affect the forward-looking statements. Actual results and developments are likely to differ, and may differ materially, from those expressed or implied by the forward-looking statements contained in this MD&A. Such statements are based on a number of assumptions that may prove to be incorrect, including, but not limited to, assumptions about the following: the availability of financing for Gowest's exploration and evaluation activities; operating and exploration costs; the Company's ability to retain and attract skilled staff; timing of the receipt of regulatory and governmental approvals for exploration projects and other operations; market competition; and general business and economic conditions.

Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause Gowest's actual results, performance or achievements to be materially different from any of its future results, performance or achievements expressed or implied by forward-looking statements. All forward- looking statements herein are qualified by this cautionary statement. Accordingly, readers should not place

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undue reliance on forward-looking statements. The Company undertakes no obligation to update publicly or otherwise revise any forward-looking statements, whether as a result of new information or future events or otherwise, except as may be required by law. If the Company does update one or more forward-looking statements, no inference should be drawn that it will make additional updates with respect to those or other forward-looking statements, unless required by law.

Date of MD&A

This MD&A is dated September 23, 2021.

Description of the Business and Going Concern

Gowest is in the business of exploring and evaluating properties that it believes contain mineralization that is, or will, in the future, be economically recoverable. The Company is focused on the exploration and evaluation of the North Timmins Gold Project ("NTGP"), which includes its wholly-owned Bradshaw gold deposit (formerly Frankfield East gold deposit). Gowest's 11,185-hectare (111 square kilometres) NTGP land package is located near Timmins, Ontario, in the Timmins Gold Camp, which since its discovery in the early 1900's, has produced almost half of all the gold mined in Canada.

The Company's primary objective is to advance its Bradshaw gold deposit to development and increase the resource through exploration in the NTGP. The Company also remains open to evaluating other potential opportunities to enhance shareholder value.

In addition to its focus on exploration and evaluation of its Bradshaw gold deposit, which represents approximately 50-hectare (0.5 square kilometre), the Company is exploring additional gold targets on the remainder of its land package. This land package generally surrounds, or is contiguous with, the Frankfield property and includes exploration interests along the largely undeveloped Pipestone Fault area of the Timmins Gold Camp, including a contiguous block of claims extending approximately 18 kilometres along the Pipestone Fault from the Bradshaw gold deposit southeast towards the Clavos deposit. The Company regularly evaluates the potential to increase its holdings in the vicinity of the Pipestone Fault, among other acquisition opportunities.

The business of mining and exploring for minerals involves a high degree of risk and there can be no assurance that planned exploration and evaluation programs will result in the development of a profitable mine. The recoverability of the amount shown for mineral properties is dependent upon the existence of economically recoverable reserves, the ability of the Company to obtain the necessary financing to complete exploration and evaluation, and the subsequent development of a mine and upon future profitable production or proceeds from dispositions of such properties. Changes in future conditions could require material write-downs of the carrying amounts of mineral properties.

Although the Company has taken steps to verify title to its mineral property interests, in accordance with industry standards for the current stage of exploration of such property, these procedures do not guarantee the Company's title. Property title may be subject to unregistered prior agreements, aboriginal claims, and noncompliance with regulatory and environmental requirements. The Company's assets may also be subject to increases in taxes and royalties, renegotiation of contracts, currency exchange fluctuations and restrictions and political uncertainty.

The accompanying financial statements have been prepared on the going concern assumption that the Company will be able to realize its assets and discharge its liabilities in the normal course of business. Due to continuing operating losses, the Company's ability to continue as a going concern is dependent upon its ability to fund its working capital and exploration requirements and eventually to generate positive cash flows, either from operations or sale of property.

In assessing whether the going concern assumption is appropriate, management takes into account all available information about the future, which is at least, but is not limited to, twelve months from the end of the reporting period. The ability of the Company to continue operations is dependent upon obtaining the necessary financing to complete the development of a mineral property. Management is aware, in making its assessment, of material uncertainties related to events or conditions that may cast significant doubt upon the entity's ability to continue as a going concern.

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Accordingly, they do not give effect to adjustments that would be necessary should the Company be unable to continue as a going concern and therefore be required to realize its assets and liquidate its liabilities and commitments in other than the normal course of business and at amounts different from those in the accompanying financial statements.

COVID-19

In light of the ongoing COVID-19 situation, to ensure the safety of all of the Company's employees and contractors, all appropriate health and safety precautions continue to be instituted and followed at the Bradshaw site as well as the Company's offices in Timmins and Toronto.

The Company's operations could be significantly adversely affected by the effects of a widespread global outbreak of a contagious disease, including the recent outbreak of respiratory illness caused by COVID-

19. The Company cannot accurately predict the impact COVID-19 will have on its operations and the ability of others to meet their obligations with the Company, including uncertainties relating to the ultimate geographic spread of the virus, the severity of the disease, the duration of the outbreak, and the length of travel and quarantine restrictions imposed by governments of affected countries. In addition, a significant outbreak of contagious diseases in the human population could result in a widespread health crisis that could adversely affect the economies and financial markets of many countries, resulting in an economic downturn that could further affect the Company's operations and ability to finance its operations.

Highlights and Outlook

The Company received notification that Northern Sun Mining Redstone Mill ("Redstone") had received authorization to begin processing the Bradshaw material. In December 2020, the Company executed a 4- party agreement whereby Gowest assigned the rights and control of it's mixed development material to Northern Sun Mining ("Northern Sun"). The agreement sets out that Northern Sun will process the Gowest surface material and deliver the concentrate to Humon through an agreement with a third-party Metal Trader. Northern Sun will receive funding for the estimated value of the material that will be applied against the mill operating costs associated with the processing and delivery of the ore.

The mill received and completed processing approximately 23,000 tonnes of the mixed development material at Redstone. The results of the processing at Redstone confirmed that Bradshaw would be able to provide a sustained delivery to the mill, using local trucking company, hauling at an expected average rate of 800-850 tonnes per day of material. The delivered material was processed at the mill at an average rate of 600-900 tonnes per day during the 6-week operating period. Approximately 1,040 tonnes of concentrate was produced for shipping to the Humon smelter. The Company is looking forward to receiving the final results after the concentrate has been processed at the Humon smelter.

During this trial, 5,000 tonnes of the mixed development material was passed through the Company's onsite x-ray ore sorting plant. The initial tests were conducted to commission and optimize the sorter plant operations, including adjusting the sorter's operating parameters with the aim of maximizing metal recovery and material throughput. The sorter successfully separated waste rock from the mineralised material as expected from previous test work, raising the gold grade prior to milling.

The Company has received the vent raise permit and construction required for production mining is well underway.

The Company requires additional funding to meet its operational objectives and is working with interested parties who are reviewing both short term and long-term financing opportunities in order to complete the bulk sample and advance towards commercial production.

On June 16, 2021, the Company announced that Mr. Gregory Romain had stepped down from the Board of Directors and as the President and Chief Executive Officer. Mr. Yungang Wu was named Interim President and Chief Executive Officer. Mr. Romain has agreed to remain as a consultant to the Corporation to assist in the transition and as it enters into a new phase in its development.

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On June 16, 2021, the Company announced that it had entered into a loan agreement with Lush Land Investment Canada Inc. for a bridge loan in the amount of $1,000,000. The loan matures on June 30, 2022, shall accrue interest daily and be calculated and payable periodically on each of September 15, 2021, December 15, 2021, March 15, 2022 and June 30, 2022, in arrears, at the rate of 18% per annum. The bridge loan may be repaid at any time prior to maturity without penalty.

On June 21, 2021, 282,500 stock options to acquire commons shares at a price of $0.95 per share expired unexercised.

On July 26, 2021, the Company announced that it intends to convert a total of $18,024,088 of debt ("Debt") that is owed to four separate creditors. The Debt is expected to be converted into common shares at a conversion price of $0.25 per share, resulting in the issuance of an aggregate of 72,096,350 common shares of Gowest. The debt conversion is subject to TSX venture exchange review and approval.

On August 26, 2021, the Company announced that Mr. Dan Gagnon was appointed as President and CEO, effective October 4, 2021. The Company also announced the appointment of Mr. Demin (Fleming) Huang as Chief Financial Officer of the Corporation, effective August 28th. Mr. Huang will replace Ms. Janet O'Donnell, whose pending resignation was announced on July 6.

On September 15, 2021, the Company entered into an unsecured loan agreement with Meirong Yuan, director of the Company for a principal amount of $500,000. Subject to the terms of the loan agreement, the outstanding principal balance, together with accrued and unpaid interest thereon, shall be due and payable on September 15, 2022. Interest on the daily outstanding principal balance shall accrue daily and be calculated, in arrears, at a rate of twelve percent (12%). The loan may be repaid at any time prior to maturity without penalty.

Selected quarterly information

The following tables set out certain financial performance highlights for the last eight quarters:

	Third Quarter	Second Quarter	First Quarter	Fourth Quarter
	July 31, 2021	April 30, 2021	January 31, 2021	October 31, 2020
General and administrative expenses	817,944	377,065	1,000,846	2,009,834
Foreign exchange loss (gain)	360,177	(848,279)	(615,164)	(95,344)
Interest expense	849,282	1,100,014	927,947	929,265
Accretion expense	2,342	2,342	2,342	3,191
Deferred income tax expense (recovery)	-	-	-	(1,083,000)
Flow through premium recovery	-	-	-	(94,823)
Net comprehensive loss/ (gain)	2,029,745	631,142	1,315,971	1,669,123
Net loss per share, basic and diluted	0.025	0.008	0.020	0.021
Cash flow (used in) operations	(172,511)	112,578	121,975	2,308,485
Cash & cash equivalents, end of period	337,075	171,881	659,162	459,489
Assets	65,004,976	64,466,017	64,517,250	62,435,467

	Third Quarter	Second Quarter	First Quarter	Fourth Quarter
	July 31, 2020	April 30, 2020	January 31, 2020 October 31, 2019
General and administrative expenses	788,363	861,244	911,064	1,224,354
Foreign exchange loss (gain)	(506,000)	677,000	73,000	3,332
Interest expense	1,062,933	707,198	648,234	76,548
Accretion expense	3,191	3,191	3,191	156,679
Deferred income tax expense	-	-	-	(1,851,000)
Net comprehensive loss / (gain)	1,178,199	2,248,633	1,635,489	2,055,552
Net loss per share, basic and diluted	0.015	0.029	0.025	0.040
Cash flow (used in) operations	(2,039,748)	(689,170)	(907,568)	(283,323)
Cash & cash equivalents, end of period	992,720	855,046	1,484,291	284,567
Assets	60,811,251	59,741,533	59,351,191	57,246,391
Deferred tax liabilities	1,083,000	1,083,000	1,083,000	1,083,000
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The following is a summary of selected audited financial information for the fiscal years of:

	2020	2019	2018
	$	$	$
General and administrative expenses	4,570,505	2,705,599	2,162,293
Foreign exchange (loss) / gain	(148,656)	41,188	(443,640)
Interest, other (expense) / income	(3,347,630)	(79,462)	(25,836)
Accretion (expense)	12,764	(1,640,168)	(1,527,089)
Deferred income tax (expense) / recovery	1,083,000	1,915,000	(1,665,000)
Net loss for the year	(6,731,444)	(4,913,180)	(4,782,716)
Net comprehensive loss for the year	(6,731,444)	(4,914,680)	(4,784,216)
Net loss per share, basic and diluted	(0.09)	(0.103)	(0.134)
Cash flow (used in) operations	(1,328,001)	(2,319,600)	(596,880)
Cash & cash equivalents,
end of year	459,489	284,567	153,174
Assets	62,435,467	57,246,391	53,493,001
Long term debt	9,949,222	13,160,000	7,862,935
Deferred tax liabilities	-	1,083,000	2,901,000

Results of Operations

The Company's activities during the three- and nine-month period ended July 31, 2021, produced a net comprehensive loss of 2,029,745 and 3,976,858, respectively as compared to a net comprehensive loss of $1,178,199 and $5,062,321, respectively for the comparable prior year period.

The expenditures listing below are followed by a brief discussion of significant line items in expenses.

	Three Months Ended	Nine Months Ended
	July 31, 2021	July 31, 2020	July 31, 2021	July 31, 2020
General administrative expenses	757,633	261,588	1,346,737	764,868
Professional fees	32,210	170,203	61,641	525,685
Investor relations	7,540	7,500	22,661	27,619
Shareholder communications	604	2,767	7,555	6,195
Share based payment	-	35,400	-	35,400
Transfer agent and exchange fees	2,914	2,977	17,229	22,936
Amortization	17,043	18,776	52,372	62,180
Mill stand by charge (Note 16)	-	450,000	687,660	1,600,000
Total General and administration	817,944	949,211	2,195,855	3,044,883
Accretion	2,342	3,191	7,026	9,573
Foreign exchange (gain) / loss	360,177	(506,000)	(1,103,266)	244,000
Gain on settlement	-	(170,288)	-	(170,288)
Interest and other expenses	849,282	902,085	2,877,243	1,934,153
Total Loss before taxes	2,029,745	1,178,199	3,976,858	5,062,321

General Administrative Expenses - The current three- and nine-months periods costs as compared to the prior year comparable period reflects the ongoing corporate and administrative expense provisions associated with additional corporate management services fees. In current three- and nine-months periods, the Company has made a provision of $470,000 for a termination settlement with the former President and CEO.

Professional Fees - The current three- and six-month period costs reflect legal and audit fees for the period as compared to prior year fees for legal, audit and costs associated with the Company's financing efforts during the comparable prior year period.

Shareholder Communications - The shareholder communication expenses during the current three- and six-month period reflects costs associated with the public news releases.

Transfer agent and regulatory fees - Transfer agent and regulatory fees for the current three- and six- month period reflects costs associated with exchange filing fees and ongoing shareholder management.

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