Montage Gold : Q1 2021 MD&A

MONTAGE GOLD CORP.

MANAGEMENT'S DISCUSSION AND ANALYSIS

THREE MONTHS ENDED MARCH 31, 2021

(Amounts in Canadian Dollars unless otherwise indicated)

The following management's discussion and analysis ("MD&A") of Montage Gold Corp. ("Montage" or the "Company") should be read in conjunction with the unaudited condensed interim consolidated financial statements for the three months ended March 31, 2021. The financial information in this MD&A is reported in Canadian dollars unless otherwise indicated and is derived from the Company's condensed interim consolidated financial statements prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board, applicable to the preparation of interim financial statements, including IAS 34, Interim Financial Reporting. The effective date of this MD&A is May 25, 2021. Additional information about the Company and its business activities is available on SEDAR at www.sedar.comand the Company's website www.montagegoldcorp.com.

BUSINESS OVERVIEW

Montage is a Mineral Resource company engaged in the exploration and development of mineral properties in Côte d'Ivoire which include the Koné Gold Project (previously named the Morondo Gold Project), the Korokaha Gold Project, and the Bobosso Gold Project (collectively, the "Montage Properties"). As at the date hereof, Montage's sole material asset is the Koné Gold Project. The Company has not yet determined whether the Montage Properties contain Mineral Reserves that are economically recoverable. The continued operations of Montage and the recoverability of the amounts shown for the Montage Properties is dependent upon, among other things, the existence of economically recoverable Mineral Reserves, the ability of Montage to obtain necessary financing to complete the exploration and development of such properties and upon future profitable production from or disposition of such properties.

Montage Gold Corp. was incorporated under the Business Corporations Act (British Columbia) on July 4, 2019, as a wholly-owned subsidiary of Orca Gold Inc ("Orca").

On July 17, 2019, Montage, Avant Minerals Inc ("Avant), and Progress Minerals International Inc ("Progress") entered into the Share Purchase Agreement that contemplated the consolidation of: (i) the mineral interests of Orca located in Côte d'Ivoire; (ii) the mineral interests of Avant located in Côte d'Ivoire and Burkina Faso; and (iii) cash held by Avant.

On July 23, 2019, pursuant to the Orca Spin-Out: (i) all of the shares of Ghazal Resources Inc., a former indirect wholly-owned subsidiary of Orca, were transferred to Montage; and (ii) Montage issued 33,000,000 Common Shares to a subsidiary of Orca, which were subsequently transferred to and are now held by Orca.

On August 27, 2019, Montage, Avant, and Progress completed the Avant Transaction pursuant to the Share Purchase Agreement. Under the Avant Transaction, Montage acquired all of the issued and outstanding shares of Progress Minerals, being a wholly-owned subsidiary of PMII and an indirect subsidiary of Avant, existing under the laws of the British Virgin Islands, in exchange for 22,000,000 Common Shares.

On August 27, 2019, the Montage Shareholders Agreement was entered into among Montage, Orca, and Progress and Montage completed a private placement of $8.2 million, pursuant to which Montage issued 18,226,374 Common Shares at $0.45 per share. Additionally, 250,000 Common Shares were issued as an advisory fee in respect of the Avant Transaction at deemed price of $0.40 per Common Share. Following this transaction Orca's ownership in Montage decreased to 45%, however Montage remained a subsidiary of Orca based on Orca's ability to control the appointment of key management personnel, make operating decisions and also its level of representation on the board of directors.

On October 23, 2020, Montage closed its initial public offering of an aggregate of 27,272,728 common shares at a price of $1.10 per share for total proceeds of $30 million and commenced trading on the TSXV under the ticker symbol MAU. Montage granted the underwriters an over-allotment option exercisable in whole or in part at their sole discretion for a period of 30 days following the closing of the offering, to purchase up to an additional 15% of the common shares at the offering price issued as part of Montage's initial public offering. On October 30, 2020 the underwriters fully exercised their over-allotment option to acquire an additional 4,090,909 shares at the offering price resulting in additional aggregate gross proceeds of approximately $4.5 million.

Following the Montage IPO, Orca's percentage ownership in Montage decreased from 45% to 31.5% and Orca entered into a new investor rights agreement with Montage replacing the initial shareholders agreement between Orca and Avant. Under the investor agreement Orca has the right to appoint a single director to the board of directors if it has a 10% ownership percentage in Montage and can appoint up to three directors if it has a 20% ownership interest in Montage. With Orca's reduced board representation and ownership percentage, Orca has significant influence, rather than control over the Company and Orca has reported the results of Montage as an associate using the equity method effective October 23, 2020.

On November 3, 2020 Montage completed the disposal of its 51% interest in its Burkina Faso properties to Predictive Discovery Limited ("Predictive") in exchange for 4,028,477 Predictive shares with a fair value of $0.2 million.

Q1 2021 OPERATING HIGHLIGHTS

The Company commenced a 35,000m infill drilling program at the Koné Gold Project in January. The primary focus of the Company is the Koné Gold Project which includes the Koné deposit that is host to an Inferred Mineral Resource of 123Mt at a grade of 0.80 g/t for 3.16 Moz of gold at 0.40g/t cut-off grade. The Company's infill drilling program is aimed at upgrading the Inferred Mineral Resource at Koné to the Indicated category by the end of 2021. The Indicated Mineral Resource Estimate is to support the Company's Feasibility Study, which is planned to be released by the end of 2021. At the end of March 2021 the drill campaign had completed 26,219m of diamond drilling and 18,318m of RC drilling.

The Company also completed a number of workstreams including the hydrological, geotechnical and metallurgical and engineering work for the Preliminary Economic Assessment ("PEA"), the summary which has been announced via press release on May 25, 2021. Environmental baseline work was underway in Q1 and the Company is expected to submit its Environmental and Social Impact Assessment to the Côte d'Ivoire government in late 2021. Total exploration costs were $7.3 million (2020: $1.3 million), with 87% being drilling and sampling costs. Prior year exploration costs for Q1 2020 included $0.5 million for Burkina Faso.

OUTLOOK

The Company continues to manage and respond to the COVID-19 pandemic and has implemented preventative measures to ensure the safety of its workforce, local communities and other key stakeholders. The Company has not experienced delays to its drilling program at K297oné as a result of COVID-19, however the situation in Côte d'Ivoire as a result of the COVID-19 pandemic continues to evolve and it is possible that prior restrictions will be put back in force, or new restrictions introduced that may require the Company to cease exploration activities.

Given the uncertainty of the duration and magnitude of the impact of COVID-19 there may be a material adverse effect on global economic activity and could result in volatility and disruption to global supply chains and the financial and capital markets, which could affect the business, financial condition, results of operations and other factors relevant to the Company, including its ability to raise additional financing.

Based on the results of the infill drilling program, the Company has expanded its 35,000m drill program to 55,000m. The expanded program will focus on drilling below the Koné resource and advancing the evaluation of other mineral properties in Côte d'Ivoire as part of its growth strategy. The Company is planning to complete its Feasibility Study by the end of 2021.

The Company released the summary results from its PEA on May 25, 2021, demonstrating a large-scale, long- life, low-cost mining project centred around the Koné deposit. Over the projected 14.7 year project life, more than 3Moz of gold will be produced at all-in sustaining costs of $975 per ounce. Annual gold production will average 205,000 ounces per annum over life of the project, with peak production at approximately, 308,000 ounces in years 2 and 3 of the project. Economic analysis run using $1,600 per oz gold price yields results with an after-tax NPV5% of $652 million and IRR of 31% (calculated on a 100% basis). Pre-production capital is estimated at approximately $490 million to build the project which will include an 11Mtpa processing facility. The Company will continue to advance the project from the PEA stage through to Feasibility and will also be submitting the necessary applications to permit the project, with submission of the ESIA and mining permit application expected in Q4 2021.

SUMMARY OF QUARTERLY FINANCIAL RESULTS

Revenue ($000's)

Exploration costs ($000's)

Total net loss ($000's)

Net loss attributed to the Company's shareholders ($000's)

Net loss per share attributed to the Company's shareholders basic and diluted ($)

Total assets ($000's)

Total current financial liabilities ($000's)

Mar - 21	Dec - 20	Sept - 20	June -20	Mar - 20	Dec -19	Sept -19	June -19
Nil	Nil	Nil	Nil	Nil	Nil	Nil	Nil
7,315	3,374	1,551	905	1,340	1,540	468	416
8,153	5,254	2,230	1,165	1,739	2,582	1,047	666
8,153	5,585	2,189	1,111	1,503	2,332	1,019	666
0.08	0.06	0.03	0.02	0.02	0.08	0.02	0.02
41,013	46,694	18,269	19,653	20,361	21,935	23,568	5,618
4,544	2,118	863	577	643	863	385	54

As a junior mining company, Montage has no expectation of generating operating profits until it develops a commercially viable mineral deposit.

Operating performance to July 23, 2019 includes results from operations and cash flows of Orca, which are deemed to be attributable to the Company. Management was required to make certain judgements, including the use of relative levels of exploration activity during any given period as a reasonable basis to allocate common expenses. These Orca results from operations and cash flows were allocated to the Company for the period until the acquisition of assets from Orca on July 23, 2019.

During Q1, 2019 exploration activity was advanced at the Koné Prospect in the Morondo Exploration Permit and commenced work in the Korokaha North Exploration Permit, identifying a broad soil anomaly in the southern portion of the permit.

During Q2, 2019 exploration work in the Morondo Exploration Permit included a pitting program to test the extensions to the known mineralisation. Work in the Korokaha North Exploration Permit included a mechanised auger program to test various areas of anomalism in the soil geochemistry in the northern part of the permit.

During Q3, 2019, the Company entered into a sale and purchase agreement with Avant pursuant to which Avant transferred its assets in Côte d'Ivoire and Burkina Faso to Montage. The Company continued with its drilling operations at Koné with a 5,000m aircore program and the commencement of a 5,000m of combined reverse circulation and diamond core drilling.

During Q4, 2019 the company continued work at the Koné Prospect, identifying a high-grade anomaly 8 km east of Koné. The Company placed the Burkina Faso assets on care and maintenance.

During Q1, 2020, exploration activity was comprised of 574.6m of core drilling and 2,687m of shallow reverse circulation drilling in the Morondo Exploration Permit and a short sampling program on the Korokaha North Exploration Permit. As a result of the COVID-19 pandemic the Company ceased operations in the Morondo Exploration Permit on March 27, 2020 based on the government's guidelines and health authorities imposing restrictions in the country. During Q2 on May 20, 2020 based upon Government's guidelines and lifting of restrictions by health authorities, Montage recommenced its exploration at Koné. The Company also completed some work at the Wendéné Exploration Permit.

Following completion of the initial public offering in October 2020, Montage commenced a drill campaign designed to expand Inferred Mineral Resources at the Koné Gold Project. Following completion of that drill

program an updated Inferred Mineral Resource estimate was calculated and released on January 28, 2021 which comprised of 128Mt grading 0.80g/t for 3.16Moz of gold at a cut-off grade of 0.40g/t.

The Company completed its exit from Burkina Faso following the sale of its entities to Predictive Discovery Limited on November 3, 2020, reporting a loss from discontinued operations of $0.4 million.

During Q1, 2021 the Company advanced its drilling campaign at the Koné Gold Project as well the required studies and workstreams for the completion of the PEA. Total exploration costs were $7.3 million (2020: $1.3 million), with 87% being drilling and sampling costs. Prior year exploration costs for Q1 2020 included $0.5 million for Burkina Faso.

Administration costs, excluding share-based compensation, for the period ended March 31, 2021 was $0.5 million (2020: $0.3 million). The increase in administration costs is largely due to an increase in management costs following the Company's IPO.

LIQUIDITY AND CAPITAL RESOURCES

As at March 31, 2021, the Company had a consolidated cash balance of $27.6 million (December 31, 2020: $32.8 million). The majority of proceeds are being used to advance work related to its exploration and drilling program at the Koné Gold Project and for advancing exploration on other permits for growth.

The source and use of funds from the Company's IPO on October 23, 2020 to March 31, 2021 compared to the amounts disclosed in the prospectus are as follows.

		Actual Expenditure
	Montage	Period to March 31,
	Prospectus	2021
Total Source of Funds	31,955,066	36,759,237
Expenditures
Koné Gold Project Phase I: Preliminary Economic
Assessment	6,500,000	4,287,195
Koné Gold Project Phase 2: Feasibility Study	11,400,000	5,304,607
Other exploration on Montage Properties	900,000	70,249
Cote d'Ivoire indirect operating costs and overhead	4,400,000	1,832,733
General corporate and working capital purposes	8,755,066	2,185,127
Total	31,955,066	13,679,911

The Company's source of funds was $4.8 million higher than projected in the prospectus, due to the underwriters fully exercising their overallotment option to acquire an additional 4.1 million shares for gross proceeds of $4.5 million.

Montage expenditures to March 31, 2021 were approximately $13.7 million. The PEA was completed on the timeline contemplated at a saving of approximately $2.0 million compared to the prospectus projected use of funds. These savings are expected to be spent on the Company's increased 55,000m drill program as part of the feasibility study and exploration on other Montage properties. In addition the Company's general corporate expenses since the closing of the Offering to the end of the first quarter were less than anticipated resulting in saving of approximately $1.0 million.

RELATED PARTY TRANSACTIONS

The related party with which the Company has transacted during the three months to March 31, 2021 was Geodex Consultants Ltd. ("Geodex"). Geodex is related by virtue of their proprietor being a director and officer of the Company. Montage is an associate of Orca and therefore Orca is a related party. There were no related party transactions between Orca and Montage during the year.

1. Services received from related parties

		Three months	Three months
		ended	ended
	Related	March 31,	March 31,
	party	2021	2020
Geological consulting	Geodex	7,224	6,447
Total services received from		7,224	6,447
related parties
b) Related party balances

The Company had no amounts due to related parties as at March 31, 2021 and December 31, 2020.