Magna Gold : Managements Discussion and Anlysis For September 30 2021

MAGNA GOLD CORP.

MANAGEMENT'S DISCUSSION AND ANALYSIS

FOR THE THREE AND NINE MONTHS ENDED

SEPTEMBER 30, 2021 AND 2020

(EXPRESSED IN MILLIONS OF US DOLLARS, UNLESS OTHERWISE STATED)

Magna Gold Corp.

Management's Discussion and Analysis

Three and Nine Months Ended September 30, 2021 and 2020 Discussion dated: November 25, 2021

(In millions of US Dollars, unless otherwise stated)

INTRODUCTION

The following Management's Discussion and Analysis ("MD&A") for Magna Gold Corp. together with its subsidiaries ("Magna" or the "Company") is prepared as of November 25, 2021, and relates to the financial condition and results of operations for the three and nine months ended September 30, 2021 and 2020. Past performance may not be indicative of future performance. This MD&A should be read in conjunction with the condensed interim consolidated financial statements ("interim financial statements") and related notes for the three and nine months ended September 30, 2021 and 2020, 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" or "GAAP"). As such, the interim financial statements do not contain all the disclosures required by IFRS for annual financial statements and should be read in conjunction with the Company's audited consolidated financial statements for the nine months ended December 31, 2020, and year ended March 31, 2020 ("consolidated financial statements").

The first, second, third and fourth quarters of the Company's fiscal years are referred to as "Q1", "Q2", "Q3" and "Q4", respectively. The three months ended September 30, 2021, are also referred to as "Q3 2021". As a result of the change in the Company's year- end from March 31 to December 31 during the previous fiscal year, the comparative period for Q3 2021 is the three months ended September 30, 2020. The nine months ended September 30, 2021 and 2020, are also referred to as "YTD 2021" and "YTD 2020", respectively.

All amounts are presented in United States dollars, the Company's presentation currency, unless otherwise stated. References to "C$" and "MXN" are to Canadian dollars and Mexican pesos, respectively.

Statements are subject to the risks and uncertainties identified in the "Risk Factors" and "Cautionary Note Regarding Forward-LookingStatements" sections of this document. The Company has included the non-GAAP performance measures of cash cost per gold ounce on a by-product basis and all-in sustaining cost per gold ounce on a by-product basis throughout this document. For further information and detailed calculations of these measures, see the "Non-GAAPMeasures" section of this document.

Additional information relating to the Company, including the Annual Information Form filed by the Company, is available on SEDAR at www.sedar.com.

QUARTERLY OPERATIONAL OVERVIEW AND RECENT DEVELOPMENTS

San Francisco Mine Highlights

The San Francisco Mine completed planned pre-stripping activities during June 2021. Q3 2021 was the first quarter at full-scale and steady rate commercial production.

During the three months ended September 30, 2021, the San Francisco Mine produced 19,102 ounces of gold, an increase of 63% and 95% compared to the three months ended June 30 and March 31, 2021, respectively.

During the three months ended September 30, 2021, the San Francisco Mine sold 18,276 ounces of gold, an increase of 55% and 117% compared to the three months ended June 30 and March 31, 2021, respectively. The average realized gold price per ounce during Q3 2021 was $1,786.

Corporate Activities

Private placement of convertible debentures

On May 12, 2021, the Company entered into a non-brokered private placement of C$10.0 million secured convertible debentures (the "Debentures") with Delbrook Capital Advisors Inc. ("Delbrook") on behalf of funds managed by Delbrook. The private placement closed on August 19, 2021, and the Company received C$10.0 million in exchange for 10,000 debentures. Additionally, the Company paid Delbrook a 1.25% arrangement fee upon closing.

The principal amount of the Debentures is convertible, at the election of Delbrook, into common shares of the Company at a conversion price of C$1.25 per common share, subject to adjustment in certain events. The interest on the Debentures is convertible, at the election of Delbrook, into either cash or common shares of the Company based on the closing price on the day prior to the issuance of a press release relating to the applicable interest payment date and will be paid in full, including in the event of early conversion.

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Magna Gold Corp.

Management's Discussion and Analysis

Three and Nine Months Ended September 30, 2021 and 2020 Discussion dated: November 25, 2021

(In millions of US Dollars, unless otherwise stated)

The Debentures mature on August 19, 2023, twenty-four months from the closing date. The Debentures will initially be unsecured obligations of the Company and will bear interest at a rate of 8.5% per annum until the date that the security contemplated for the Debentures is delivered to Delbrook. Following such delivery, if applicable, the Debentures will bear interest at a rate of 6.5% per annum. As at the date of this MD&A, the interest rate remained at 8.5% per annum.

In connection with the private placement, the Company issued 600,000 common shares and 450,000 share purchase warrants to Medalist Capital Ltd. in lieu of cash finder's fees. The share purchase warrants were issued with an exercise price of C$1.25 and an expiry date of August 19, 2024.

The securities issued in connection with the private placement will be subject to a four month hold period, in accordance with the rules and policies of the TSX Venture Exchange ("TSXV") and applicable Canadian securities laws. During September 2021, the private placement of the Debentures was given final TSXV approval.

Argonaut promissory note

On May 6, 2021, Minera Magna S.A. de C.V. ("Minera Magna") had provided a promissory note to Timmins Goldcorp Mexico S.A. de C.V. ("Timmins"), a Mexican subsidiary of Argonaut Gold Inc. ("Argonaut"), for the working capital differential of $2.7 million in relation with the acquisition of the San Francisco Mine. The promissory note was to be paid in four monthly installments, plus interest, commencing July 6, 2021, and ending October 6, 2021. The promissory note carried uncompounded interest at a rate of 5% per annum.

At the date of this MD&A, Minera Magna had made all of the scheduled payments, thereby satisfying the promissory note obligations with Timmins.

Auramet agreement extension

During September 2021, the Company, through its subsidiary Molimentales del Noroeste, S.A. de C.V. ("Molimentales"), and Auramet International LLC ("Auramet") signed an agreement extension pursuant to which the Company would receive an additional $2.0 million in exchange for four equal payments of 307 gold ounces to be delivered to Auramet starting on February 28, 2022, and ending on May 31, 2022 (the "Auramet Agreement Extension").

On September 24, 2021, the Company received $2.0 million less transaction costs and upfront fee of 1%.

Stock option grant

On September 3, 2021, the Company granted options to certain employees and officers to purchase 1,000,000 common shares of the Company pursuant to the Company's stock option plan. The options are exercisable at C$0.90 per common share and expire on September 3, 2026. The options vested immediately.

Preliminary short form base shelf prospectus

On April 21, 2021, the Company filed a preliminary short form base shelf prospectus in connection with the qualification for distribution, from time to time, of up to an aggregate offering price of C$100.0 million of the Company's securities. On July 20, 2021, the Company filed an amended and restated preliminary short form base shelf prospectus. On October 21, 2021, the Company filed a notice of withdrawal. The Company is currently evaluating potential financing activities, including the filing of a new base shelf prospectus.

Labour Reform in Mexico

On April 21, 2021, Mexican Congress approved a bill prohibiting outsourcing services in Mexico. Following the approval, a labour and tax reform (the "Reform") was later published in the Mexican Official Gazette. The Reform includes various changes to the Federal Labour Law, including the elimination of labour subcontracting arrangements, also known as outsourcing. The effective date of the elimination of outsourcing was initially set on August 1, 2021, but then extended to September 1, 2021.

Prior to the Reform, the Company's Mexican personnel were outsourced. During July 2021, to comply with the Reform, the Company proceeded with transferring its Mexican outsourced personnel to direct employees of either Molimentales or Minera Magna. LM Mining Corp, S.A. de C.V. does not have direct employees or outsourced personnel.

The Company has reviewed the impact of the Reform and does not expect an increase of its labour costs in Mexico. The prior employee compensation structure was already in compliance with the stated requirements of the Reform.

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Magna Gold Corp.

Management's Discussion and Analysis

Three and Nine Months Ended September 30, 2021 and 2020 Discussion dated: November 25, 2021

(In millions of US Dollars, unless otherwise stated)

OVERVIEW OF THE BUSINESS

Magna was incorporated on January 9, 2018, pursuant to the Business Corporations Act (Ontario) under the name Magna Gold Corp. The authorized share capital of the Company consists of an unlimited number of common shares, without nominal or par value. Its shares have been listed on the TSX Venture Exchange under the symbol "MGR" since June 10, 2019. In addition, Magna's shares trade on the OTCQB Venture Market, a U.S. trading platform that is operated by OTC Markets Group in New York, under the symbol "MGLQF". The Company's address is 18 King Street East, Suite 902, Toronto, Ontario, M5C 1C4.

On June 6, 2019, the Company completed its Qualifying Transaction, as defined in TSXV Policy 2.4 - Capital Pool Companies, consisting of the property option agreement dated September 25, 2018, pursuant to which the Company acquired an option to acquire a 100% interest in the Mercedes Property in Yécora, Mexico.

Magna is a gold mining company engaged in acquisition, exploration, development and operation of quality precious metals properties in Mexico. Magna's vision is to create a leading precious metals company by leveraging its existing platform of assets and people to maximize value for all its stakeholders.

Magna operates one open-pit heap leach operating mine: the San Francisco Mine in the state of Sonora, Mexico, located approximately 150 kilometers north of Hermosillo and 120 kilometers south of the United States/Mexico border via Highway15 (Pan- American Highway). The San Francisco Mine was in residual leaching when it was acquired on May 6, 2020. The mining and crushing activities restarted late in June 2020. During June 2021, the San Francisco Mine completed planned pre-stripping activities and began full-scale and steady rate commercial production.

In addition, Magna has exploration stage projects in Mexico. The exploration stage projects of the Company at the date of this MD&A consist of: (i) the Mercedes Property; (ii) the San Judas Project; (iii) the La Pima Project; (iv) the Las Marias Property; (v) the Los Muertos Project; (vi) the La Fortuna Project (previously described as the Cuproros Project); and (vii) the Margarita Project. Through the acquisition of Molimentales, in addition to the San Francisco Mine, the Company acquired title to the Patricia, Norma, Los Carlos, La Pima, TMC, and Dulce claims located in the state of Sonora, Mexico.

The Company's current sources of operating cash flows are primarily from the sale of gold and silver contained in doré bars produced at the San Francisco Mine. The doré is refined offsite and the refined gold and silver is sold primarily in the London spot market. As a result, Magna is not dependent on a particular purchaser.

TRENDS AND ECONOMIC CONDITIONS

Management regularly monitors economic conditions and estimates their impact on the Company's operations and incorporates these estimates in both short-term operating and longer-term strategic decisions.

Gold price

During the three months ended September 30, 2021, the spot gold price fluctuated between a low of $1,723 per ounce and a high of $1,829 per ounce. The average spot gold price for the quarter was $1,790 per ounce, a decrease of 6% compared to $1,909 per ounce for the three months ended September 30, 2020, and a decrease of 1% compared to the average spot gold price of $1,816 per ounce during the three months ended June 30, 2021.

During the nine months ended September 30, 2021, the spot gold price fluctuated between a low of $1,684 per ounce and a high of $1,943 per ounce. The average spot gold price for the nine months was $1,800 per ounce, an increase of 4% compared to $1,736 per ounce for the nine months ended September 30, 2020.

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Magna Gold Corp.

Management's Discussion and Analysis

Three and Nine Months Ended September 30, 2021 and 2020 Discussion dated: November 25, 2021

(In millions of US Dollars, unless otherwise stated)

COVID-19

Due to the worldwide COVID-19 pandemic, material uncertainties may arise that could influence management's going concern assumption. Management cannot accurately predict the future impact COVID-19 may have on:

• Global gold prices;
• Demand for gold and the ability to explore for gold;
• The severity and the length of potential measures taken by governments to manage the spread of the virus, and their effect on labour availability and supply lines;
• Availability of government supplies, such as water and electricity;
• Purchasing power of the United States dollars, Canadian dollars and Mexican pesos; and,
• Ability to obtain funding.

During the nine months ended September 30, 2021, and during the nine months ended December 31, 2020, there has been no material impact on the operating and exploration activities of the Company. Production at the San Francisco Mine has continued as per the schedule detailed in the pre-feasibility study ("PFS") dated August 28, 2020. As of the date of this MD&A, the Canadian and Mexican authorities have not introduced any further measures that are impacting, or are expected to impact, the Company's operations in Canada or Mexico. The United States authorities have not introduced any further measures that are impacting, or are expected to impact, the Company's deliveries of doré bars to its customer in the United States.

The focus of the Company is to ensure the safety of its workforce and community. The Company instituted numerous social distancing measures, including working from home, limiting travel of any kind, and restricting access to sites. Further, the Company has increased efforts to clean and sanitize common areas as well as provide training and information to employees to reduce the risk of exposure and transmission of the virus.

Even though the Company has not incurred material impacts to date from the COVID-19 pandemic, the duration and impact of the COVID-19 outbreak is undetermined. As a result, it is not possible to reliably estimate the length and severity of COVID-19 developments and the impact on the financial results and condition of Magna in future periods.

Apart from these factors and the risk factors noted under the heading "Risk Factors", management is not aware of any other trends, demands, commitments, events or uncertainties that would have a material effect on the Company's business, financial condition or results of operations.

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