Macarthur Minerals : MD&A to 30 September 2021

ACN 103 011 436

For personal use only

Management's Discussion and Analysis

(Form 51-102F1)

For the Quarter ended September 30, 2021

Information as of November 29, 2021 unless otherwise stated

Note to Reader

The following management's discussion and analysis ("MD&A") of the financial condition and results of operations of Macarthur Minerals Limited ("Macarthur" or the "Company") for the six-month period ended September 30,2021 has been prepared by management, in accordance with the requirements of National Instrument 51-102, as of November 29, 2021 (unless otherwise stated).

This MD&A should be read in conjunction with the Company's Annual Audited Financial Statements and MD&A for the period ended March 31, 2021, together with the notes thereto, as well as the Company's previous quarterly and half yearly financial and MD&A reports. The Condensed Interim Consolidated Financial Statements for the six-month period ended September 30, 2021 are prepared in accordance with International Financial Reporting Standards ("IFRS").

Forward-Looking Information

This MD&A includes certain statements that may be deemed "forward-looking statements" within the meaning of applicable Canadian and Australian securities legislation. All statements in this MD&A, other than statements of historical facts, are forward-looking statements. Forward-looking statements are typically identified by words such as: believe, expect, anticipate, intend, estimate, postulate, plans and similar expressions, or which by their nature refer to future events. These forward-looking statements include, but are not limited to activities, events or developments that the Company believes, expects or anticipates will or may occur in the future. Although the Company believes that expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. The material factors or assumptions used to develop forward-looking information include prevailing and projected market prices, exploitation and exploration estimates and results, continued availability of capital and financing, and general economic, market or business conditions. Factors that could cause actual results to differ materially from those in forward-looking statements include, without limitation: fluctuations in exchange rates and certain commodity prices, uncertainties related to mineral title in the projects, unforeseen technology changes that results in a reduction in minerals demand or substitution by other minerals or materials, the discovery of new large low-cost deposits of minerals and the general level of global economic activity. Readers are cautioned not to place undue reliance on forward-looking statements due to the inherent uncertainty thereof. Such statements relate to future events and expectations and, as such, involve known and unknown risks and uncertainties. The forward-looking statements contained in this MD&A and are made as of the date of this MD&A or as of the date or dates specified in such statements and except as may otherwise be required pursuant to applicable laws, the Company does not assume any obligation to update or revise these forward-looking statements, whether as a result of new information, future events or otherwise.

Inherent in forward-looking statements are risks and uncertainties beyond the Company's ability to predict or control, including, but not limited to, risks related to the Company's inability to identify one or more economic deposits on its properties, variations in the nature, quality and quantity of any mineral deposits that may be located, variations in the market price of any mineral products the Company may produce or plan to produce, the Company's inability to obtain any necessary permits, consents or authorizations required for its activities, to produce minerals from its properties successfully or profitably, to continue its projected growth, to raise the necessary capital or to be fully able to implement its business strategies, and other risks identified herein under "Risk and Uncertainties".

These forward-looking statements are made as at the date hereof or as of the date or dates specified in such statements and the Company does not intend and does not assume any obligation, to update these forward-looking statements, except as required by applicable 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. Investors are cautioned that any such statements are not guarantees of future performance and actual results or developments may differ materially from those projected in the forward-looking statements and investors should not attribute undue certainty to or place undue reliance on forward-looking statements.

Macarthur Minerals Ltd

Management's Discussion and Analysis
For the period end September 30, 2021	TSX-V: MMS, ASX: MIO, OTCQB:MMSDF

Discussion on Operations

For personal use only

BACKGROUND

Macarthur Minerals Limited is an Australian public company listed in Canada on the TSX Venture Exchange ("TSX-V") (symbol: MMS), Australian Securities Exchange ("ASX") (symbol: MIO) and OTCQB Venture Market ("OTCQB") (symbol: MMSDF). Macarthur Minerals has three iron ore projects in the Yilgarn region of Western Australia. The Company has also established multiple project areas in the Pilbara, Western Australia for conglomerate gold, hard rock greenstone gold and hard rock lithium. In addition, Macarthur Minerals has lithium brine interests in the Railroad Valley, Nevada, USA.

WESTERN AUSTRALIAN IRON ORE PROJECTS

Lake Giles Projects

Macarthur Minerals' Lake Giles Iron Ore Projects ("Lake Giles Projects") are located on mining tenements covering approximately 62 km2, 175 kilometres ("km") northwest of Kalgoorlie in Western Australia. Within the tenements, at least 33 km strike extent of outcropping banded iron formation ("BIF") occurs as low ridges, surrounded by intensely weathered and mostly unexposed granites, basalts and ultramafic rocks.

The Lake Giles Projects are situated in the Yilgarn Region of Western Australia. The Yilgarn Region is host to many significant mineral deposits that have been, or are being, mined for iron ore. The tenements cover the Yerilgee greenstone belt which is some 80 km in length and lies within the Southern Cross Province of the Yilgarn. The Lake Giles Projects are approximately 90 km from the existing Perth Kalgoorlie Railway that has a direct connection to the Port of Esperance in Western Australia, where it is intended that ore from the Projects will be shipped. Export is subject to available capacity, which is not certain. The Lake Giles Iron Project (comprising the Moonshine Magnetite Project and the Ularring Hematite Project) is located approximately 450 kilometres East North- East of the coastal city of Perth, Western Australia, and approximately 115 kilometres West of the town of Menzies. Exploration for the Ularring Hematite and Moonshine Magnetite Projects has been sufficient to allow the estimation of Mineral Resources for both projects.

The average iron ore grades of major producers have been in decline globally for some time, and since January 2016, there has been a consistent premium gap between the 62% Fe benchmark prices and the higher grade +65%Fe (being the target grade for the Company's Lake Giles Iron Project). Although iron ore prices have fallen over the September 2021 Quarter, the premium gap remains and the Board remains confident that the convergence of global policy shifts with procurement strategies of major iron ore and steel consumers in coming decades in response to climate change, coupled with the potential for high grade magnetite products to help deliver global emissions reductions, will drive demand for the Company's high grade iron ore long into the future.

Ularring Hematite Project

The Ularring Hematite Project's Mineral Resources are comprised of Indicated Mineral Resources of approximately 54.5 Mt @ 47.2% Fe and approximately 26Mt @ 45.4% Fe Inferred resources. The Mineral Resource estimates were prepared by CSA Global on behalf of Macarthur Minerals (NI43-101 Technical Report, 20121) and reported in accordance with the CIM Definition Standards for Mineral Resources and Reserves 2014.

The Company has received approval to develop an iron ore mine for the Ularring Hematite Project and associated infrastructure at the project location under the Environmental Protection Act 1986 and the Environmental and Biodiversity Conservation Act 1999. On March 26, 2021 the Company made application two miscellaneous licences to support the development of a mining camp and crushing and screening operations near the Snark deposit of the Ularring Hematite Project.

During the quarter, the Company engaged Orelogy Mining Consultants to commence mine planning for a small- scale DSO operation focusing on the Snark and Drabble Downs deposits. Preliminary pit optimisations have been completed with the next stage to focus on detailed pit designs and scheduling.

1 NI 43-101 Technical Report filed October 1, 2012, titled "NI 43-101 Technical Report, Macarthur Minerals Limited, Pre-Feasibility Study, Ularring Hematite

Project, Western Australia."

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Macarthur Minerals Ltd

Management's Discussion and Analysis
For the period end September 30, 2021	TSX-V: MMS, ASX: MIO, OTCQB:MMSDF

Discussion on Operations (Cont'd)

For personal use only

Moonshine Magnetite Project

On August 12, 2020 Macarthur released an updated Mineral Resource estimate for the Lake Giles Magnetite Project2. The Mineral Resource estimates includes Measured Mineral Resources of approximately 53.9Mt @ 30.8% Fe, Indicated Mineral Resources of 218.7 Mt @ 27.5% Fe and Inferred Mineral Resources of 997.0 Mt @ 28.4% Fe.

The company has commenced its work for a Feasibility Study (FS) focusing on the Moonshine magnetite deposit at Lake Giles. That work is well underway with the Mineral Resource estimates of the Moonshine deposit having been completed and released to the market on August 12, 2020. The Company filed the NI43-101 Technical Report on SEDAR, as announced on October 1, 20203.

On March 26, 2021 the Company made application for two "water search miscellaneous licenses" for the purpose of exploring for groundwater to support magnetite processing for the Lake Giles Iron Project. The applications cover 533 km2 of the Rebecca Palaeovalley up to 35 km east of the Project. Prior to these applications the Company engaged CGG to undertake an aerial EM survey of the palaeochannels to as announced on March 26, 2021. The survey data will be used to define groundwater drilling targets.

On June 25, 2020, the Company lodged applications for tenure to construct a haul road and rail siding to support the Lake Giles Iron Project. Miscellaneous license application L16/133 will be used to construct a 93km haul road from the Moonshine deposit to a rail siding adjacent to the rail network, owned by Arc. The rail siding will be located on the applications for miscellaneous license L15/409 and exploration license E15/1775.

During the quarter, the Company engaged engineering consultants, Engenium (a division of Stantec) to complete the process and non-process engineering design. Engenium is currently managing the metallurgical test work program that will inform the process design. The Company submitted bulk samples of magnetite core to Bureau Veritas to complete the metallurgical test work under the supervision of Engenium. Test work included analyses of material properties, LIMs and HPGR studies. During the quarter the Company completed a program of geotechnical drilling encompassing a total of 9 diamond holes across the Moonshine and Moonshine North magnetite deposits. Samples have been submitted to the laboratory in Perth for analyses of various rock strength parameters. The outcomes are to be incorporated into the final mine design to be completed by Orelogy Mining Consultants.

Treppo Grande & Mt Jackson Iron Ore Project

On February 15, 2018, the Company's wholly owned subsidiary, Esperance Iron Ore Export Company Pty Ltd ("EIOEC") made an application for Exploration License E77/2521 for the Treppo Grande Iron Ore Project ("Treppo Grande Project"). The Treppo Grande Project covers an area of 68 km2 and is located approximately 32 km west of the Lake Giles Projects. The project is also 35km east of Mineral Resource Ltd's (MRL) Koolyanobbing Iron Ore Operations and is in close proximity to established rail infrastructure to the Port of Esperance. This area had been held by a private exploration company wholly owned by renowned Kalgoorlie Prospector Mel Dalla-Costa for the past eight years under an Exploration License (EL77/1208). During this time, approval was granted for an exploration program of diamond drilling and geophysical mapping. The Treppo Grande Project has already benefited from flora and fauna baseline surveys indicating that the conservation values of Mt Manning are a lower priority than surrounding BIF ridges.

The Treppo Grande Project was explored in recent years for high grade hematite iron ore mineralisation. Historical exploration identified three potentially economic styles of Direct Shipping Ore ("DSO") mineralisation including massive dense hematitic ironstones, specular hematite and oxidised 'Indurated Detrital Ironstone'. A drilling programme consisting of two diamond holes penetrated the hematitic ironstone at the J-Hook prospect.

Significant intercepts include 17.5m @ 65.49% Fe from 2.5m from hole MMS002 and 40.4m @ 55.77% Fe from

3.6 m from hole MMS001. The iron-rich mineralisation (> 55% Fe) is centered on the J-Hook prospect that contains occurrences of massive, fissile and specular hematite. The Company also has two iron ore exploration areas (E77/2543 and E77/2542) in the Yilgarn region, adding an additional 42km2 to the Company's portfolio. These tenements are adjacent to the Mt Jackson and Deception iron ore deposits owned by MRL.

2 Refer to the Company's news release dated August 12, 2020. 3 Refer to the Company's news release dated October 1, 2020.

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Macarthur Minerals Ltd

Management's Discussion and Analysis
For the period end September 30, 2021	TSX-V: MMS, ASX: MIO, OTCQB:MMSDF

Discussion on Operations (Cont'd)

For personal use only

WESTERN AUSTRALIAN GOLD PROJECTS

Hillside Gold Project

The Hillside Gold Project encompasses Exploration License E45/4685, E45/4824, E45/4708 and E45/4709 held by Macarthur Lithium Pty Ltd (MLi)(renamed to Infinity Mining Limited (Infinity) as of August 20, 2021 and currentlyin the process of listing to the Australian Securities Exchange (ASX)), a subsidiary of Macarthur Minerals. This group of tenements is located approximately 185kilometers (km) South East of Port Hedland and 50km South West of Marble Bar (the "Hillside Gold Project") in Western Australia.

The Hillside Gold Project is highly prospective for gold and copper. The area has previously been explored by various companies for gold, copper, zinc and lead but limited drilling exists.

These tenements surround the mining lease of the historic Edelwiess gold mine. A limited drilling program consisting of six rotary percussion ("RC") holes conducted by Metana Minerals N.L in 1980 intersected gold mineralisation associated with quartz veins. Gold was recorded in three holes with an average grade of approximately 12 g/t Au and a maximum of 25.83 Au g/t. In addition, sampling along a discontinuous outcropping gossan over a strike of 18 km, showed high potential for copper mineralisation. A total of 20 results yielded above 1,000 ppm Cu to a maximum of 7.8% Cu.

The gossan line was traced over a 14km strike length with remnant outcrop identified at regular intervals along strike. A total of 36 rock chip samples were collected including 15 from outcropping gossan with several samples containing visible copper minerals such as malachite. Remaining samples were collected from quartz outcrops, many of which returned strongly anomalous gold grades.

The assay results are highly encouraging with eight samples returning copper values over 1% with a peak of 18.8% Cu and often accompanied with elevated gold, silver and zinc values (+/- cobalt).

Exploration at the Hillside Project also discovered high grade manganese mineralisation in sub parallel outcrops to the gossan line sampled above. Rock chips samples returned a maximum of 59.4% MnO (>46% Mn).

A drilling program focussing on the gossan line and outcropping quartz reefs was completed by FEL under an option agreement. A total of 36 holes for 1798 metres was drilled. Assay results returned from the laboratory demonstrate support for a mineralised gossan model with down dip extension of mineralised gossan at surface intercepted in three holes with the following results:

• HRC001: 1m @ 0.19% Cu, 230ppm Co, 0.14% Zn, 0.07ppm Au from 28m
• HRC022: 1m @ 0.74% Cu, 349ppm Co, 0.41% Zn, 0.14ppm Au from 83m
• HRC036: 1m @ 0.18% Cu, 0.12% Zn from 25m and 1m @0.27% Cu from 40m.

FEL conducted further exploration activities on the Hillside tenements following the drilling program completed in 2020 with a Fixed Loop Electromagnetic (FLEM) survey across six discreet areas covering a gossanous copper trend and indicating five SKYTEM anomalies identified in 2018. In total, 20 lines of FLEM were surveyed for a total of 246 stations over 11.05 line kilometres. Newexco interpretation recommended "all anomalies warrant further investigation in the field and are suggested for follow up drilling to determine the source of each anomaly". The Option Agreement with FEL was terminated on September 15, 2020 with Macarthur retaining full title to the tenements.

In early 2021, the Company conducted a reconnaissance field trip to further investigate the highly anomalous gold results previously reported and this confirmed the gold potential. In April 2021, MLi undertook an ASTER VNIR/SWIR and LWIR imaging survey over the Pilbara tenements, including E45/4685. In summary, this survey noted gold areas previously identified by groundwork was strongly associated with tourmaline and arsenopyrite. The association with these two endmembers opened up new target areas on this tenement. The ASTER survey also strongly associated copper mineralisation associated with Enargite and Malachite. This association with these two endmembers opened up new target areas on this tenement. ASTER data has subsequently been overlaid with historic SkyTEM, soil sampling, rock chip sampling, FLEM survey data and the results from the 2019 RC drilling program. The main exploration targets are gold, copper and other base metals within the north- south striking Coongan-Greenstone Belt. In September 2021, the Company completed an extensive mapping and soil sampling program over a four-week period with a qualified geologist and field staff to support a budgeted and planned drilling program during the 2022 field season.

In October 2021, Infinity completed a short but detailed programme of soil sampling over the Hillside tenements, to inform and support drill targeting for a more extensive exploration campaign during the 2022 field season.

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Macarthur Minerals Ltd

Management's Discussion and Analysis
For the period end September 30, 2021	TSX-V: MMS, ASX: MIO, OTCQB:MMSDF

Discussion on Operations (Cont'd)

Strelley Gorge & Tambourah tenements

For personal use only

Macarthur holds the Strelley Gorge and Tambourah tenements in the Pilbara region of Western Australia. The Strelley Gorge tenement (E45/4735) is prospective for DSO iron ore and is located immediately adjacent to the Abydos iron ore project that has been mined by Atlas Iron. The Tambourah tenement (E45/5324) is also prospective for iron ore having intersected iron ore in historical drilling by Atlas Iron. The drilling focussed an outcropping BIF prospect in the north of the tenement. Macarthur considers both tenements prospective for iron ore and pursuant to the Tenement Sale and Non Iron Ore Rights Agreement dated August 11, 2021 executed between the Company's iron ore focused subsidiary Macarthur Iron Ore Pty Ltd (MIO) and MLi (renamed to Infinity), MIO purchased E45/4735 and E45/5324 (Macarthur Iron Ore Tenements), and Infinity retained all rights to explore for, extract and sell all minerals, including gold, lithium and nickel, excluding iron ore, recovered from the Macarthur Iron Ore Tenements (which includes any conversions to a mining lease) (Non-Iron Ore Rights), subject to the terms and conditions of the agreement.

Panorama Gold Project

The Panorama Gold Project encompasses Exploration Licenses E45/4732, E45/4764 and E45/4779 held by Infinity, covering a total of 252km2.

The Panorama Gold Project is located 265km south-south-east of Karratha in the Pilbara Region of Western Australia. The project is prospective for lithium and gold hosted within conglomerate. The tenement group contains an extensive area of the Mt Roe Basalt which is the geological member of the Fortescue Group that overlies the conglomerate gold horizon at Artemis Resources Limited's Purdy's Reward Project near Karratha, Western Australia.

In May and July 2018, the Company conducted stream sediment sampling programs across the tenements. During the geochemical survey a total of 45 samples were collected from selected drainage courses confirming several anomalous sediment values ranging from 13 ppb to 113 ppb Gold. This area was previously identified from historical rock chip sampling program with values of up to 3.5 g/t Au.

The Panorama Gold Project formed part of the earn-in agreement with FEL, which was terminated on September 15,2020, following FEL's election not to earn-in on a 25% Stage 1 Interest.

WESTERN AUSTRALIAN NICKEL AND COBALT PROJECTS

The Company has identified two areas prospective for sulphide hosted base metal deposits based on historical drill results at the Snark and Moonshine prospects, located on the Company's Lake Giles Projects in the Yilgarn, Western Australia. The Snark prospect is considered to be a highly favorable tectonic and structural setting and is well supported by surface geology featuring volcanic sequences comprising of high Mg basalts and Kambalda type komatiitic ultramafic flows in which nickel-sulfide ore bodies are hosted. In February 2018, a reconnaissance trip to the area discovered surface rock samples containing the cobalt mineral asbolite with assays reporting up to 2.6% cobalt and 2.0% nickel.

The Moonshine prospect has also been identified as prospective for nickel sulphide deposits from previous drilling. Anomalous nickel values including 0.9% Ni from 10.5 meters to 22 meters including 1 meter at 1.4% nickel were detected within the first 30 meters of a diamond drill hole completed by the company in 2012. Anomalous cobalt averaging 0.13% was also discovered from 18.5 meters to 22 meters.

The Company has completed Moving Loop Electromagnetic ("MLEM") and Fixed-Loop Electromagnetic ("FLEM") surveys across three prospect areas: Moonshine, Snark and Clark Hill. Interpretation of the MLEM and FLEM survey identified three high priority nickel sulphide targets, consisting of two distinct bedrock conductors at Moonshine and a further bedrock conductor at Snark. Preliminary Reverse Circulation "RC" drilling of two holes for 395 meters intersected sulphide minerals at depth with sulphide mineralisation open at depth with the hole ending in sulphide mineralisation. Semi-massive sulphide comprising 20% pyrite/pyrrhotite was recorded over 12m in hole 18MRC002 from 185m to end of hole ("EOH"). Anomalous nickel was found in hole 18MNRC001 with average 0.2% Ni over 31 meters ("m"). Potassic alteration was identified in hole 18MRC001 from 140m to 146m (20% Potassium content) marginal to the sulphide intersection in the hole. Anomalous gold associated with sulfidic chert was also found in interval 106m to 113m in hole 18MNRC001 (average gold content 159 part per billion ("ppb") over the interval). Both holes had successfully intersected sulphide minerals at depth and semi-massive sulphide comprising 20% pyrite/pyrrhotite was recorded over 12m in hole 18MRC002 from 185m to end of hole ("EOH"). Sulphide mineralisation is open at depth and on strike with the hole ending in sulphide mineralisation.

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