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    MMG   CA59126M1068

METALLIC MINERALS CORP.

(MMG)
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Metallic Minerals : Management Discussion and Analysis

11/29/2021 | 06:01pm EST

MANAGEMENT'S DISCUSSION AND ANALYSIS

FOR THE YEAR ENDED JULY 31, 2021

The following Management's Discussion and Analysis ("MD&A") of Metallic Minerals Corp. ("Metallic" or the "Company") is for the year ended July 31, 2021 and is dated November 29, 2021. This MD&A should be read in conjunction with the Company's consolidated financial statements for the year ended July 31, 2021, which have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Boards ("IASB").

The Company is a reporting issuer in BC, Alberta, and Ontario. The Company's common shares are traded on the TSX Venture Exchange ("TSX-V") under the symbol "MMG" and the US OTCQB Exchange under the symbol "MMNGF".

The Company's functional and presentation currency is the Canadian dollar and all amounts included herein are in Canadian dollars, unless otherwise indicated.

NATURE OF BUSINESS

Metallic is a growth stage exploration company, focused on the acquisition and development of high-grade silver and gold exploration properties in brownfield mining districts. The Company was originally incorporated in the Province of British Columbia on May 3, 2007 under the Business Corporations Act (British Columbia) and was registered as an extra-territorial corporation under the Business Corporations Act (Yukon) on July 10, 2009. The Company's key assets are located in the high-grade Keno Hill silver district (Canada), La Plata silver-gold-copper district (USA), and Klondike gold district (Canada). All three districts have existing infrastructure, including grid power, highway and road access.

Metallic is a member of the Metallic Group of Companies, a collaboration of three precious and/or base metals exploration companies, with a portfolio of large, brownfields assets in established mining districts adjacent to some of the industry's highest-grade producers of silver, platinum group metals and copper. The Metallic Group includes highly successful explorationists, formerly with leading explorer/developers including NovaGold Resources Inc., Trilogy Metals Inc., Wellgreen Platinum Ltd. (now Nickel Creek Platinum Corp.), as well as larger producers including Placer Dome Inc. (now Barrick Gold Corporation), Goldfields Limited, and Stillwater Mining Company (now Sibanye-Stillwater).

Member companies include Metallic, Group Ten Metals Inc. (TSX-V: PGE) in the Stillwater PGM-Ni-Cu district of

Montana, and Granite Creek Copper Ltd. (TSX-V: GCX) in the Minto copper district of the Yukon. Each of the Metallic Group companies has a dedicated, highly experienced management team and board of directors with a track record of exploration, financing and project development success.

HIGHLIGHTS AND KEY DEVELOPMENTS

  • On November 22, 2021, the Company announced completion of its exploration programs at its Keno Silver project in the Yukon Territory of Canada. The multi-phase exploration program consisted of reverse circulation and diamond core drilling, induced polarization geophysics, surface sampling, and district-wide stratigraphic and structural mapping across the 35-kilometer-wide district. The program, which began in June, was the Company's most extensive exploration campaign on the project to date, with 53 holes totalling nearly 6,200 meters completed along with 20.3 line-kilometers of deep-penetrating IP geophysical surveys. The work program was designed to achieve a number of important objectives including expanding the extent of drill- defined mineralization at the advanced target areas in the central and western parts of the Keno Hill silver district towards initial resource estimates, along with follow-up drilling at the new discovery areas identified at East Keno to define the scale of mineralization along trend and to depth within these multi-kilometer-scale soil and geophysical targets. The Company also announced a $1.56 million warrant exercise by resource investor Eric Sprott.

Page 1 of 22

MANAGEMENT'S DISCUSSION AND ANALYSIS

FOR THE YEAR ENDED JULY 31, 2021

  • On July 28, 2021, the Company announced significant progress at its alluvial gold operations in the prolific Klondike gold district of Canada's Yukon Territory. The Company has active leases on four alluvial claim blocks on Australia and Dominion Creeks with three operators. All four of these properties are at the development stage with exploration, infrastructure development and bulk sample testing being completed in preparation for commercial gold production with a 10-15% royalty payable to Metallic.
  • On July 20, 2021, the Company announced the start of the first phase of drilling at the La Plata silver-gold- project in southwest Colorado. This initial diamond core drill program is designed to test and confirm mineralization in the central porphyry system, which hosts a historical resource estimate, as the first steps toward developing a new NI 43-101 compliant resource estimate.
  • On June 9, 2021, the Company announced the mobilization of its exploration team for the start of the 2021 drilling and exploration campaign at the Company's 100% owned, 166 square kilometer Keno Silver project.
  • On April 7, 2021, the Company reported drill results from the advanced West Keno targets on the Company's 100%-owned,166-square-kilometer Keno Silver project. The program consisted of 12 diamond drill holes totalling 2,674 meters (8,772 ft) completed at the Formo and Silver Queen targets along extensions of Alexco Resource's productive Bermingham and Elsa structural corridors. Drilling at Formo intersected high-grade silver within well-mineralized vein structures along a north-easterly extension of the Bermingham-Calumet system, which is host to the largest historical mine and the largest current resources and reserves in the Keno Hill silver district.
  • On February 18, 2021, the Company announced results from the first drilling program ever completed on the eastern part of the Keno Hill silver district. These drill results extended the known area of high-grade silver mineralization in the district by 10 kilometers to the east and also intercepted broad continuous zones of bulk- tonnage disseminated mineralization. These new drill-based discoveries returned significant silver mineralization in 26 out of 30 drill holes. Soil sampling and geophysical surveys over the past two years at East Keno have identified 12 multi-kilometer-scale anomalies which show potential for large-scale mineralization in an under-explored part of the Keno Hill silver district.
  • On January 25, 2021, the Company received approval from OTC Markets Group Inc. for trading on the OTCQB Venture Market, under the symbol MMNGF, as of January 26, 2021. The Company's common shares continue to trade on the TSX Venture Exchange under the symbol MMG. The Company participated in the StreetSmartLive! Event on January 26, 2021.
  • On January 12, 2021, the Company announced that it has engaged the services of Independent Trading Group to provide market-making services in accordance with TSX Venture Exchange policies. The Company further announced it had initiated the process for up listing its common shares to the US OTCQB Venture Market from the Pink Open Market.
  • On December 10, 2020, the Company announced the completion of its 2020 field exploration programs in the Keno Hill silver district and McKay and Silver Hill properties. Exploration on the Keno Silver project included a multi-phase drill program which began in August involving two drill rigs which completed a total of 5,318 meters (17,500 ft) in 42 drill holes.
  • On November 26, 2020, the Company closed a flow-through private placement of 3,896,104 shares at a price of $0.77 per share for gross proceeds of $3,000,000. The Company paid a finder's fee of $142,405 and issued 184,942 finder warrants. Each warrant is exercisable for a period of 24 months, into one common share of the Company at an exercise price of $0.77.

Page 2 of 22

MANAGEMENT'S DISCUSSION AND ANALYSIS

FOR THE YEAR ENDED JULY 31, 2021

MINERAL PROPERTIES

YUKON SILVER PROJECTS, CANADA

As shown in Figure 1 below, Metallic's core Keno Silver project is located in the historic Keno Hill silver district of Canada's Yukon Territory, with over 295 million ounces ("Moz") of high-grade silver in past production and current M&I resources and excellent existing infrastructure, including grid power, highway and road access. In addition, its McKay Hill project is a historic producer and is located northeast of the Keno Silver project in a newly emerging silver and gold mining district.

Figure 1. The Company's silver properties consist of the Keno Silver project and McKay and Silver Hill projects located in central Yukon Territory of Canada. The Keno Silver project comprises the Keno-Lightning (which includes Homestake), Keno Summit, Gram, Keno-East, Cobalt Hill, Duncan Creek, Formo and Silver Queen properties.

Page 3 of 22

MANAGEMENT'S DISCUSSION AND ANALYSIS

FOR THE YEAR ENDED JULY 31, 2021

KENO SILVER PROJECT

Metallic's 100% owned Keno Silver project covers 166 square km ("km2") within the Keno Hill silver district located in Canada's Yukon Territory. The Keno Silver project is a brownfields exploration project within one of the world's highest- grade silver districts, which has produced over 220 Moz of high-grade silver over the past 100 years at an average grade exceeding 1,300 g/t. The Keno Silver project, which is located near the communities of Keno City and Mayo, has excellent existing infrastructure with highway and road access, grid power and access to existing deep sea ports.

The Keno Silver project covers the eastern and central portions of the Keno Hill silver district along with select portions of the western and southern parts of the district. The Company's holdings are along trend and down dip of most of the historically productive trends within the district. These areas of the district have been under-explored due to previously fragmented, private land ownership that has largely been consolidated by Metallic. The Keno Silver project directly adjoins Alexco Resource Corp.'s operations, including the Bellekeno, Bermingham, Flame & Moth and Lucky Queen deposits, which contain 74 million ozs of high-grade silver in current Measured & Indicated resources and an additional 24 million ozs in Inferred resources. Ten of the twelve known Keno-stylehigh-grade silver structural trends occur on the Keno Silver project in areas underlain by the preferred host rocks within the district.

The Keno Silver project has seen shallow, historic production from eight deposits, including five with average grades above 5,000 g/t silver. Metallic has been compiling and integrating recent and historic geologic and geophysical data into its project database and modelling work. Exploration work has defined three high-grade advanced stage targets through drilling, trenching and underground sampling and has identified 12 priority multi-kilometer-scaleearly-stage exploration targets.

The Keno Silver project is made up of eight main properties across the 35-kilometer-long Keno Hill silver district comprising Keno-Lightning, Keno Summit, Gram, Keno East, Cobalt Hill, Duncan Creek, Formo and Silver Queen properties.

  1. Keno-LightningProperty
    The Keno-Lightning property, which includes Homestake, is the largest property within the Keno Silver project and is subject to a 3% NSR. The Company has the option to buy back up to 2% of this NSR.
  2. Keno Summit Property
    The Company owns 100% of 17 claims and five leases on the Keno Summit property. Nine claims are subject to the same NSR as the Gram property, seven claims and two leases are subject to the same NSR as the Silver Queen property, three leases are subject to the same NSR as the Formo property and one claim is not subject to an NSR.
  3. Keno-EastProperty
    The Company staked additional ground in the Keno-East target area, which covers the eastern and southern extension of the Keno Hill silver district. The Company owns 100% of these claims and are not subject to any NSR.
  4. Gram Property
    The Company owns 100% of the Gram property which consists of 42 claims covering approximately 8.7 km2 on the east side of the Keno Hill silver district. The Gram property is subject to a 2% NSR for precious metals and a 1% NSR for base metals and the Company has the option to buy back the full NSR.

Page 4 of 22

MANAGEMENT'S DISCUSSION AND ANALYSIS

FOR THE YEAR ENDED JULY 31, 2021

  1. Cobalt Hill Property
    The Company owns 100% of the Cobalt Hill property covering 4.2 km2 that are contiguous with the eastern end of the Keno-Lightning property in the Keno Hill silver district. Cobalt Hill is subject to a 3% NSR and the Company has the option to buy back up to 1.5% of this NSR.
  2. Duncan Creek Property
    The Duncan Creek property was staked by the Company in January 2017 along with other claims totaling approximately 30.2 km2. The Company owns 100% of the Duncan Creek claims and they are not subject to any underlying royalties.
  3. Formo Property
    The Company owns 100% of 16 mining leases in the Keno Hill silver district. The Formo property is subject to a 2% NSR for precious metals and a 1% NSR for base metals. The Company has an option to buy back the full NSR.
  4. Silver Queen Property
    The Company owns 100% of the Silver Queen property which consists of 20 claims primarily on the western end of the Keno Hill silver district. The Silver Queen property is subject to a 2% NSR and the Company has the option to buy back the full NSR.

KENO SILVER PROJECT WORK PROGRAMS

The Company conducted its inaugural field exploration programs on its Keno Silver project beginning in 2017 following a comprehensive review of modern and historic data. Metallic identified more than 40 target areas in its review and prioritized 20 of these target areas for further evaluation including geophysical and geochemical surveys, geologic mapping, drilling and trenching to begin defining areas that had potential to host significant high-gradeKeno-style silver mineralization.

Exploration on the project has continued to systematically build on the Company's 3D geologic model for the district including on-going synthesis of new exploration data covering the east, central and western portions of the Keno Hill silver district. This work includes a combination of target refinement and advancement at the advanced stage targets located along the known historically productive trends both down dip and along strike from past producing mines, as well as target development in the under-explored eastern part of the district which features many of the same geologic characteristics as the more developed western part of the Keno Hill silver district.

Exploration work has defined three high-grade advanced stage targets through drilling, trenching and underground sampling along the known productive trends that are advancing toward initial resource estimates, along with additional areas at first phase drill stage in the West and Central Keno target areas. Earlier stage target refinement work in the less explored portions of the district has included detailed stratigraphic and structural mapping, broad reconnaissance soil sampling, airborne and ground based geophysics focused on the Central and East Keno target areas. This work identified 12 new multi-kilometer-scaleearly-stage exploration targets for drill testing. Work on these very large-scale areas has confirmed the presence of high-gradeKeno-style structures with geophysics suggesting potential for larger related structurally hosted, magmatic driven systems.

Page 5 of 22

This is an excerpt of the original content. To continue reading it, access the original document here.

Disclaimer

Metallic Minerals Corp. published this content on 29 November 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 29 November 2021 23:00:04 UTC.


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Financials
Sales 2021 - - -
Net income 2021 -7,49 M -5,99 M -5,99 M
Net cash 2021 4,02 M 3,21 M 3,21 M
P/E ratio 2021 -7,28x
Yield 2021 -
Capitalization 59,3 M 47,3 M 47,3 M
EV / Sales 2020 -
EV / Sales 2021 -
Nbr of Employees -
Free-Float 78,4%
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Managers and Directors
Gregory Shawn Johnson Chairman, President & Chief Executive Officer
Rebecca Moriarty Chief Financial Officer
Gregor Hamilton Independent Non-Executive Director
Peter William Harris Independent Director
Douglas Dale Warkentin Independent Director
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