Manganese X Energy Corp.

Management's Discussion and Analysis

For the year ending March 31, 2022

GENERAL INFORMATION

Management's Discussion and Analysis ("MD&A") of the financial position and of the results of operations is the responsibility of management and has been reviewed and approved by the Board of Directors of Manganese X Energy Corp. ("Manganese", "MN" or the "Company") on July 27, 2022.

Manganese X Energy Corp. was incorporated as a private company by Certificate of Incorporation issued pursuant to the provisions of the British Columbia Business Corporation Act on December 4, 2007. On December 3, 2010, the Company changed its name from Numine to Sunset Cove Mining Inc. On December 1, 2016, the Company changed its name from Sunset Cove Mining Inc. to Manganese X Energy Corp. The principal activities of Manganese and its subsidiaries are to acquire and advance high potential mining prospects located in North America with the intent of supplying value-added materials to the lithium ion battery and other alternative energy industries.

The Company's principal project is its Battery Hill manganese project described more fully below. Having advanced this project by a significant recent drilling program, the Company commissioned Wood Canada Limited to provide a Preliminary Economic Assessment ("PEA"). The PEA has been recently completed with very positive results and was filed on the Company's SEDAR profile on June 27, 2022, with an effective date of May 12, 2022, as a technical report in compliance with National Instrument 43-101 (Standards of Disclosure for Mineral Projects). The prospect of becoming a viable resource for the "domestic" North American production of manganese suitable for the rapidly expanding battery market is an extremely exciting one. Opportunities for the Company appear to have been further enhanced by recent announcements of multi-billion dollar battery manufacturing facilities to be constructed in Canada. The future looks bright.

On April 30, 2020, Manganese X Energy Corp. acquired a U.S. HVAC (heating, ventilation and air conditioning), patent for an air purification and disinfection process through its 100% owned subsidiary Disruptive Battery Corp. (DBC). On November 16, 2020, DBC executed a Definitive Agreement acquiring a 50-per-cent Joint Venture (JV) equity stake in PureBiotics, an air quality control company. Together they formed a Joint Venture, PureBiotic Air Corp., for the purpose of providing a safe and effective air purification process by controlling air and surface contamination, thereby resulting in healthier homes and buildings. This air purification process incorporates the company's U.S. patented HVAC distribution system, designed to circulate Air Disinfection Agents (ADAs) through a building's HVAC system, as well as PureBiotics Air Mist Solutions, proven, safe and effective proprietary biological solutions for the purification of air and surfaces. In 2021, DBC and PureBiotic Air Corp. progressively worked with Virginia State University (VSU) researchers on the deconstruction of biofilm, calculated by the Centers for Disease Control (CDC) to be a factor in 80 per cent of all infections, including SARS-CoV-2, the cause of the COVID-19 pandemic. Advances were also being made in 2022 in the certification and regulatory registrations of its products regardless of the delays caused by COVID-19 interruptions and restrictions.

The Company's shares are listed under the symbol MN on the TSX Venture Exchange (the "Exchange"). The registered office of the Company is located at 145 Graveline, Saint-Laurent, Quebec, Canada and it maintains a place of business at 120 Carlton St. Suite 219 in Toronto, Ontario, Canada.

The following discussion and analysis should be read in conjunction with the audited consolidated financial statements for the years ended March 31, 2022 and 2021 and with the related notes attached thereto. These consolidated financial statements have been prepared in accordance with international accounting standards for financial reporting.

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Manganese X Energy Corp.

Management's Discussion and Analysis

For the year ending March 31, 2022

The MD&A is provided to enable the reader to assess material changes in financial position and results of operations for the year ended March 31, 2022, in comparison to the corresponding period the year before. This MD&A is also intended to supplement and complement the audited consolidated financial statements of Manganese and accompanying notes for the years ended March 31, 2022 and 2021.

The MD&A is prepared in conformity with NI 51-102F1 and unless expressly stated otherwise, all references to dollar amounts are in Canadian dollars, the functional currency of the Company.

The Company has now completed the dividending out to its shareholders of the shares of its former subsidiary Graphano Energy Limited ("GEL") which is now trading separately on the Exchange under the trading symbol GEL.

FORWARD-LOOKING STATEMENTS AND GOING CONCERN CAUTION

This MD&A for the year ended March 31, 2022 may contain or refer to certain forward-looking statements relating, but not limited to, the Company's expectations, intentions, plans and beliefs. Forward-looking information can often be identified by forward-looking words such as "anticipate", "believe", "expect", "goal", "intend", "estimate", "may", and "will" or similar words suggesting future outcomes, or other expectations, beliefs, plans, objectives, assumptions, intentions or statements about future events or performance.

Any forward-looking information that may be presented in this MD&A is identified as such. Statements regarding the adequacy of cash resources to carry out our exploration and development programs or the need for future financing are forward-looking statements. Any forward-looking information is based on current expectations that involve a number of business risks and uncertainties. Forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from expected results. Current shareholders and prospective investors should be aware that these statements are subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from those suggested forward-looking statements.

Shareholders are cautioned not to place undue reliance on forward-looking information. By its nature, forward- looking information involves numerous assumptions, inherent risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections and various future events will not occur.

GOING CONCERN DISCLOSURE

The ability of the Company to continue as a going concern is uncertain and is dependent upon its ability to fund its working capital and other requirements, complete the development of its explorations, and eventually to generate positive cash flows from operations and/or raise the capital necessary to undertake new projects. Management plans to explore alternatives possible, including joint ventures, debt and equity financings, and merger opportunities.

The business of mining exploration involves a high degree of risk and there can be no assurance that current exploration programs will result in profitable mining operations. The recoverability of the carrying value of exploration properties and the Company's continued existence is dependent upon the preservation of its interest in the underlying properties, the discovery of economically recoverable reserves, the achievement of profitable operations, or the ability to raise alternative financing, if necessary, or alternatively upon the Company's ability to dispose of its interests on an advantageous basis. Changes in future conditions could require material write-downs of the carrying values. Although the Company has taken steps to verify title to the properties on which it is conducting exploration and has an interest, in accordance with industry standards for

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Manganese X Energy Corp.

Management's Discussion and Analysis

For the year ending March 31, 2022

the current stage of exploration of such properties, these procedures do not guarantee the Company's title. Property title may be subject to unregistered prior agreements, aboriginal claims and non-compliance with regulatory requirements.

Several adverse conditions and events cast substantial doubt upon the validity of this assumption. Manganese is not currently generating any revenue from its operations. For the year ended March 31, 2022, the Company recorded a net comprehensive loss of $4,274,412 (March 31, 2021 - $4,880,829) and had an accumulated deficit of $22,307,730 (March 31, 2021 - $18,033,317) but at that date had a positive shareholders' equity of $3,926,131 and cash of $3,511,198. While the "Going concern uncertainty" may still be justified in the longer term, the Company presently is in sound financial condition to maintain its operations for the next 18 months and beyond.

These consolidated financial statements do not reflect the adjustments to the carrying values of assets and liabilities and the reported expenses and balance sheet classifications that would be necessary were the going concern assumption inappropriate, and such adjustments, if necessary, could be material.

CORPORATE OVERVIEW

The following individuals are currently members of the Company's board of directors: Martin Kepman, Roger Dahn, James Richardson, Robert Tjandra and Luisa Moreno. James Richardson is the Company's Chief Financial Officer.

Wasserman Ramsay, Chartered Professional Accountants, are currently the Company's auditors. Shimmy Posen, a Partner of Garfinkle, Biderman LLP, is MN's corporate counsel and solicitor, and Janet Francis of Keystone Corporate Services Inc. is the Company's Corporate Secretary.

The principal activities of Manganese and its subsidiaries are to acquire and advance high potential mining prospects located in North America with the intent of supplying value-added materials to the lithium ion battery and other alternative energy industries. The Company's recent venture into the HVAC business is an opportunistic endeavour in an unrelated business area which has been prompted by the worldwide Covid crisis with its need for significantly improved air quality systems, a need which is expected to continue indefinitely into the future.

MN intends to provide a secure ethically sourced manganese supply by exploring and developing its manganese rich deposit near Woodstock New Brunswick, the Battery Hill Project.

Battery Hill/Houlton Woodstock Manganese Property

On June 28, 2016, the Company announced that it would be entering into an option agreement (the "Option Agreement") with Globex Mining Enterprises (GMX). The Company, having met certain conditions of a previously concluded agreement, announced the conclusion of an option agreement for a manganese property in the province of New Brunswick. Pursuant to the agreement, it agreed to issue up to 4 million shares of its share capital and pay up to $200,000 in order to acquire a 100% interest in the property, details as follows:

Pay $200,000 in cash to the vendor as follows: $100,000 on or before the 5th day after TSX-Venture Exchange acceptance of the Option Agreement and $100,000 on or before the date that is 12 months from the Effective date of the Option Agreement. The cash payments were a firm obligation and were made and required even in the event the Company chose not to complete the option agreement and have been completely satisfied.

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Manganese X Energy Corp.

Management's Discussion and Analysis

For the year ending March 31, 2022

Issue 4,000,000 common shares as follows: 1,000,000 shares on or before the 5th day after TSX-Venture Exchange acceptance of the Option Agreement; a further 1,000,000 shares on or before the 1st anniversary of the Effective date of the option agreement (these first two share issuances were firm commitments); and a further 2,000,000 shares on or before the 2nd anniversary of the Effective date of the option agreement. All these shares have now been issued as below.

Spend $1,000,000 in exploration expenditures on the property as follows: $500,000 on or before the 1st anniversary of the Effective date of the Option Agreement and an additional $500,000 on or before the 2nd anniversary of the Effective date of the Option Agreement. This commitment has been satisfied.

The Company made the first cash payment deposit of $100,000 on April 28, 2016 and a final cash payment of $100,000 on February 3, 2017. As at March 31, 2018, a total of 2,400,000 shares were issued as per the option agreement including 400,000 shares as finder's fees common shares. The Company made the first share payment of 1 million shares on December 4th 2016 and an additional second share payment of 1 million shares on April 22, 2017. On November 30, 2018 the Company issued the final tranche of shares required under the option agreed by issuing 2,000,000 common shares at a value of $0.12 each for a total value of $240,000 and now owns 100% of the claims subject to a 3% Gross Metals Royalty.

Subsequent to March 31, 2022, the company released a Preliminary Economic Assessment ("PEA") for its wholly owned Battery Hill project. The PEA was prepared by Wood Canada Ltd., an independent engineering services group with extensive experience in mining and mineral processing.

A Preliminary Economic Assessment ("PEA") (the most important first stage in assessing the feasibility of a new mining project) tries to answer the question, "How best can this deposit be exploited to maximize its economic returns?". A PEA can use "inferred" mineral resources (as well as those measured and indicated) for its operational and financial modeling. A PEA doesn't usually form the basis for a production decision because of the higher degree of unknown risks and costs and timelines. The PEA is preliminary in nature, it includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and there is no certainty that the PEA will be realized.

Manganese X's PEA on the Battery Hill Property was filed on the Company's SEDAR profile on June 27, 2022 with an effective date of May 12, 2022.

The impressive results and robust economics of the PEA may be summarized as follows (all dollar values are in US dollars unless otherwise stated):

Robust Economics:

  • After-taxnet present value using a 10% discount rate ("NPV10"): $486 million
  • 25% internal rate of return ("IRR")
  • Capital costs ("CAPEX") of $350 million with a payback of 2.8 years
  • Average annual gross revenue of $177 million per year over the 47 years Project life
  • Average annual gross revenue of $220 million over the first seven years
  • Life of mine ("LOM") operating cost ("OPEX") of $122/t material processed

HPMSM Market Price:

  • Base case market price of $2,900/t for battery-gradehigh-purity manganese sulphate ("HPMSM") is well below the long-term forecast price of $4,200/t HPMSM estimated by CPM Group

Price Sensitivity:

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Manganese X Energy Corp.

Management's Discussion and Analysis

For the year ending March 31, 2022

  • Base case undiscounted after-tax cashflow: $3.4 billion
  • Sensitivity analysis shows after-tax NPV10 reaches $914 million at $4,200/t HPMSM

Long Mine Life:

  • 40-yearmine production life and seven years of stockpile reclaim feed
  • Total LOM production of 3.2 million tonnes of HPMSM
  • Average annual HPMSM production of 68,000 tonnes over the LOM
  • Average annual HPMSM production of 84,000 tonnes in the first seven years of production

Low Environmental Impact:

  • Flowsheet produces a filtered residue leach product with initial acid-base accounting and non-acid generating test results showing no acid drainage risk

Gross Metal Royalty Assumptions ("GMR") in the PEA

For the purpose of the application of the GMR to the inputs of the cut-off for the mineral resource estimate in the PEA, the following assumptions were made:

  • 3% GMR
  • The GMR is applied to the HPMSM product from the processing facility
  • Base case assumed price of the HPMSM for the GMR is US$2,900/t (HPMSM price source: CPM Group, April 20, 2022, "HPMSM Market Update" letter report to Manganese X).

In determining the GMR amount, no costs of any kind were deducted from the value of the product produced. When providing the GMR guidance to Wood, the Company identified the following alternative factors suggesting that the 3% calculation should be based only on the manganese content within the HPMSM which would be a product achieved by the Company at a very significant cost, not contemplated when the GMR was entered into but a very different concept from most GMR's:

  • The Option Agreement contains significant ambiguity and vagueness with respect to certain terms of the GMR, including (i) the determination of the references prices that are to be used to value the metals and products that are produced from the Property; and (ii) the stage of production in the processing and value chain of deliverable metals within a production facility whereby the GMR becomes payable. The GMR is also silent or missing several terms typically found in a royalty agreement, such as: (a) terms addressing the transferability or assignability of the royalty by the royalty holder; (b) whether the consent of the property owner/miner is required for any such transfer or assignment of the royalty by the royalty holder; (c) whether the property owner/miner has a right of first refusal on any sale of the royalty by the royalty holder; and (d) whether the property owner/miner has a right or option to redeem or repurchase the royalty from the royalty holder.
  • The Option Agreement has not been the subject of any litigation, arbitration, or interpretation proceedings and accordingly no findings or decisions have been made by any court, arbitrator, or independent expert regarding the specific interpretation of the Option Agreement. Alternate interpretations of the terms of the Option Agreement and the GMR that are reasonable may exist that may be legally enforceable.

Cautionary Statement Regarding the PEA

The results of the economic analysis in the PEA represents forward-looking information that is subject to a number of known and unknown risks, uncertainties, and other factors that may cause actual results to differ materially from those presented here. Forward-looking statements in the PEA and the summary of the PEA in this MD&A include, but are not limited to: timing and amount of future cashflows from mining operations, forecast production rates and amounts of HPMSM produced from the Battery Hill mining operation, estimation of the Mineral Resources and the realization of the Mineral Resource estimates within the PEA mine plans, the time required to develop the mine based on the PEA mine design, statements with respect to future price of HPMSM and the ability to capture a share of the HPMSM market, assumptions regarding mine dilution and

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Manganese X Energy Corp. published this content on 29 July 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 29 July 2022 20:42:37 UTC.