Midland Exploration : MD&A, June 30, 2023

Midland Exploration Inc.

Management's Discussion and Analysis

Quarterly Highlights

Three and nine months ended June 30, 2023

Midland Exploration Inc.

Management Discussion & Analysis - Quarterly Highlights

Three and nine months ended June 30, 2023

The following quarterly highlights management discussion and analysis (the "MDA") of the financial condition and results of the operations of Midland Exploration Inc. ("Midland" or "the Corporation") constitutes management's review of the factors that affected the Corporation's financial and operating performance for the three and nine months ended June 30, 2023. This MDA should be read in conjunction with the Corporation's unaudited condensed interim consolidated financial statements as at June 30, 2023 prepared in accordance with the International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board applicable to the preparation of interim financial statements, including International Accounting Standard ("IAS") 34, Interim Financial Reporting, as well as with the management discussion and analysis for the year ended September 30, 2022. All figures are in Canadian dollars unless otherwise noted.

Further information regarding the Corporation and its operations are filed electronically on the System for Electronic Document Analysis and Retrieval (SEDAR) in Canada and can be found on www.sedar.com.

Abbreviation	Period
Q1-22	October 1, 2021 to December 31, 2021
Q2-22	January 1, 2022 to March 31, 2022
Q3-22	April 1, 2022 to June 30, 2022
Q3-22 YTD	October 1, 2021 to June 30, 2022
Q4-22	July 1, 2022 to September 30, 2022
Fiscal 22	October 1, 2021 to September 30, 2022
Q1-23	October 1, 2022 to December 31, 2022
Q2-23	January 1, 2023 to March 31, 2023
Q3-23	April 1, 2023 to June 30, 2023
Q3-23 YTD	October 1, 2022 to June 30, 2023
Q4-23	July 1, 2023 to September 30, 2023
Fiscal 23	October 1, 2022 to September 30, 2023

Gino Roger, geological engineer, president and chief executive officer of Midland, qualified person under NI 43-101, has reviewed the following technical disclosure of the MDA.

1. NATURE OF ACTIVITIES
   Midland, incorporated on October 2, 1995 and operating under the Business Corporations Act (Québec), is a company in the mining exploration business. The Corporation's operations include the acquisition and exploration of mining properties. The Corporation's shares are listed on the TSX Venture Exchange (the "Exchange") under the MD ticker.
2. OVERALL PERFORMANCE

2.1 Highlights of exploration work in Q3-23 YTD

• New Cu-Au-Mo-Ag discovery (0.21% CuEq/345.5 m) with Probe Gold Inc. ("Probe") on La Peltrie option and a second phase of drilling in progress;
• High-gradegold shears (18.9 g/t Au) and floats (28.7 g/t Au) discovered on Laflamme and two phases of drilling completed;
• New discovery of high-gradeCu-Au under the Labrador Trough Alliance with SOQUEM Inc. ("SOQUEM");
• New Ni-Cu discovery (Santos Zone) with Rio Tinto Exploration Canada Inc. ("RTEC") on Tête Nord option and a second phase of drilling in progress;
• New option agreement with RTEC for lithium including 10 properties in James Bay and beginning of an imagery and LiDAR survey;
• New option agreement with Barrick Gold Corporation ("Barrick") for the Patris gold project and beginning of a VTEM survey;
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Midland Exploration Inc.

Management Discussion & Analysis - Quarterly Highlights

Three and nine months ended June 30, 2023

• New option agreement with Brunswick Exploration Inc. ("Brunswick") on Mythril and Elrond for their lithium potential;
• Major magnetotelluric ("MT") survey completed with BHP Canada Inc. ("BHP") and beginning of an important program of $3.5M for the Ni-Cu Alliance in Nunavik;
• Drilling programs Abitibi Discovery Drilling Program ("ADDP") completed on Patris, Heva, Adam and Laflamme.

Since the beginning of June 2023, major forest fires have been raging in Quebec. As a result, several areas of Abitibi, Côte-Nord and James Bay with Midland properties have been affected by ground access bans and some access roads have also been closed. These fires have reduced the availability of helicopters. They were requisitioned to fight the fires and evacuate affected residents, thus making exploration work in remote areas, such as James Bay and Nunavik, impossible to complete. Field work is gradually restarting in areas where access restrictions are lifted.

2.2 Working capital

Midland has an adjusted working capital1) of $5,155,736 as of June 30, 2023 ($5,935,098 as of September 30, 2022), which will allow the Corporation to execute its exploration program for at least the next two years.

The adjusted working capital1) is calculated as follows:

	As at	As at
	June 30,	September 30,
	2023	2022
	$	$
Current assets	5,795,010	6,805,920
Current liabilities	(1,439,274)	(870,822)
Working capital	4,355,736	5,935,098
Investments - non-current portion	800,000	-
Adjusted working capital1)	5,155,736	5,935,098

Note 1) Midland has included a non-IFRS measure, "Adjusted working capital", to supplement its financial statements, which are presented in accordance with IFRS. Midland believes that this measure, together with measures determined in accordance with IFRS, provide investors with an improved ability to evaluate the underlying performance of the Corporation. Non-IFRS measures do not have any standardized meaning prescribed under IFRS, and therefore they may not be comparable to similar measures employed by other companies. The data is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.

2.3 Private placements

On November 17 and December 1, 2022, the Corporation completed private placements of 4,034,000 flow-through shares at $0.50 per share for total gross proceeds of $2,017,000. In addition, on those dates, the Corporation completed, with an originator of flow-through donation financing, a private placement of 1,268,400 flow-through shares at $0.70 per share for total gross proceeds of $887,880. Also, on December 1, 2022, the Corporation completed private placements of 1,450,000 shares at $0.40 per share for total gross proceeds of $580,000.

Finally, on January 23, 2023, the Corporation completed a private placement of 356,000 shares at a price of $0.40 per share for total gross proceeds of $142,400. BHP has exercised its right to maintain its ownership to 5.0% by acquiring those 356,000 shares. This right had been granted to BHP on April 18, 2019, pursuant to an Investor Rights Agreement with the Corporation.

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Midland Exploration Inc.

Management Discussion & Analysis - Quarterly Highlights

Three and nine months ended June 30, 2023

In connection with the private placements, the Corporation incurred $206,459 share issue expense, of which $83,910 was paid as finder's fees. Directors and officers of the Corporation participated in the flow-through private placement for a total consideration of $203,000 under the same terms as other investors.

2.4 Outstanding share data
	As at	As at
	August 17, 2023	June 30, 2023
	Number	Number
Common shares	82,776,197	82,776,197
Options	6,000,000	6,000,000
	88,776,197	88,776,197

On December 8, 2022, the Corporation amended its stock option plan (the "Plan") to increase from 5,790,000 to 8,200,000 the number of shares issuable under the Plan, to provide for the requirement to obtain disinterested shareholders' approval to extend the term of options granted to insiders, eliminate the cashless exercise feature and provide that any adjustment to security-based compensation awarded or issued under the Plan, other than in connection with a stock consolidation or a stock split, is subject to the prior consent of the Exchange.

2.5 Update on agreements with partners

Option agreement with Brunswick on Mythril and Elrond

On November 22, 2022, the Corporation signed an option agreement Brunswick whereby Brunswick has the option to acquire exploration rights for critical minerals including lithium (excluding copper, nickel, zinc, lead, gold, silver, platinum and palladium) on the Mythril and Elrond properties. Under this new agreement, Brunswick may acquire an initial 50% interest, the option 1, in the Mythril property over a three-year period, at the following conditions:

	Payment in	Payments in	Exploration
	cash	shares	work
	$	$	$
Upon signature (completed)	25,000	25,000	-
On or before November 22, 2023	50,000	50,000	300,000
On or before November 22, 2024	70,000	70,000	300,000
On or before November 22, 2025	-	210,000	900,000
Total	145,000	355,000	1,500,000

In addition, Brunswick may earn an additional 35% undivided interest in the claims, option 2, in the properties over an additional two-year period, at the following conditions:

 Aggregate consideration of $200,000 payable according to the following schedule: 1st Anniversary: $100,000 in cash or stock, at Brunswick's option; 2nd anniversary: $100,000 in cash or stock, at Brunswick's option;

• Requirement to spend an additional amount of $2,000,000 in exploration expenditures, in cash or in shares, at Brunswick's option, according to the following schedule: 1st anniversary after exercising option 1: amount of $1,000,000; and 2nd anniversary after exercising option 1: additional amount of $1,000,000.

Any Brunswick share issuance during option 1 and option 2 is subject to a minimum price of $0.24 per share.

If Brunswick exercise option 1 and 2, it would hold a right of first refusal on the 15% remaining interest held by the Corporation and the Corporation would not be required to participate in exploration and development expenditures until a mine is constructed to extract all metals or minerals except precious metals (gold, platinum, palladium and silver) and base metals (copper, zinc, nickel and lead).

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Midland Exploration Inc.

Management Discussion & Analysis - Quarterly Highlights

Three and nine months ended June 30, 2023

Option agreement with Barrick on Patris

On May 11, 2023, the Corporation signed a definitive option agreement with a wholly owned indirect subsidiary of Barrick whereby Barrick may acquire a 75% interest in the Patris property in consideration for cash payments totaling $1,017,500 and exploration work totaling $16,575,000, over an eight-year period, including a firm commitment of $3,000,000, over a four-year period. Barrick is the operator. Commitment highlights are as follows to earn a 51% initial interest and form a joint venture:

	Cash payments	Exploration work
	Commitment	Completed	Commitment	Completed
	$	$	$	$
Upon signature - definitive agreement	50,000	50,000	-	-
On or before May 11, 2024	60,000	-	500,000	188 205
On or before May 11, 2025	77,500	-	-	-
On or before May 11, 2026	95,000	-	-	-
On or before May 11, 2027	110,000	-	3,500,000	-
Total	392,500	50,000	4,000,000	188 205

In the following two years, Barrick may earn an additional 9% in the joint venture, for a 60% interest in consideration for cash payments totalling $265,000 and exploration work expenditures of at least $2,000,000.

Finally, in the subsequent two years, Barrick may earn an additional 15% in the joint venture, for a total 75% interest in consideration for cash payments totalling $360,000 and exploration work expenditures of at least $10,575,000.

If Barrick does not exercise or complete the first joint venture funding or the second joint venture funding option, the joint venture interests will be subject to any subsequent adjustments in ownership made in accordance with the proportionate funding and dilution terms of the joint venture agreement. Dilution below a 10% joint venture interest results in conversion of the joint venture interest to a 2% net smelter return ("NSR") royalty with the right to repurchase 50% of the NSR royalty (1% NSR) for a payment of $1,500,000.

Option agreement with RTEC for lithium in James Bay

On June 13, 2023, the Corporation signed an option agreement with RTEC for 10 lithium properties in the James Bay region, including Corvette, Mythril-East, Chisaayuu, Galinée, Moria, Shire, Komo, Warp, Sulu, and Picard (the "Lithium Properties").

Under the option agreement, RTEC may acquire an initial 50% interest (the first option) in the Lithium Properties over a period of 5 years, subject to the following conditions:

	Cash payments	Exploration work
	Commitment	Completed	Commitment	Completed
	$	$	$	$
45 days after the lifting of wildfire	500,000	-	-	-
restrictions 1)
On or before the first anniversary	100,000	-	-	-
On or before the second anniversary	100,000	-	-	-
On or before the third anniversary	100,000	-	-	-
On or before the fourth anniversary	100,000	-	-	-
On or before the fifth anniversary	100,000	-	14,500,000	130,763
Total	1,000,000	-	14,500,000	130,763

1. As of August 17, 2023, wildfire restrictions are not completely lifted on the Lithium Properties.

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