Palamina : Management Discussion & Analysis for year ended December 31, 2022

PALAMINA CORP.

MANAGEMENT'S DISCUSSION AND ANALYSIS

FOR THE YEAR ENDED DECEMBER 31, 2022

General

The following management's discussion and analysis ("MD&A") of the financial condition and results of the operations of Palamina Corp. ("Palamina", or the "Company") constitutes management's review of the factors that affected the Company's financial and operating performance for the years ended December 31, 2022 and 2021. This MD&A was written to comply with the requirements of National Instrument 51-102 - Continuous Disclosure Obligations. This discussion should be read in conjunction with the audited annual consolidated financial statements of the Company for the years ended December 31, 2022 and 2021, together with the notes thereto ("the financial statements"). Results are reported in Canadian dollars, unless otherwise noted.

The financial statements and the financial information contained in this MD&A were prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB") and interpretations of the International Financial Reporting Interpretations Committee ("IFRIC"). Please refer to Note 4 of the annual audited consolidated financial statements as at and for the years ended December 31, 2022 and 2021 for disclosure of the Company's significant accounting policies.

The audit committee of the Company has reviewed this MD&A and the audited consolidated financial statements for the years ended December 31, 2022 and 2021 and the Company's Board of Directors approved these documents prior to their release.

This MD&A is dated May 1, 2023 and is current to that date.

Additional information relating to the Company is available free of charge on the System for Electronic Document Analysis and Retrieval ("SEDAR") website at www.sedar.comand on Palamina's website at www.palamina.com.

Caution Regarding Forward Looking Information

This MD&A includes certain statements that may be deemed "forward-looking statements". All statements in this discussion, other than statements of historical fact, that address future exploration activities and events or developments that the Company expects, are forward-looking statements. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements.

Qualified Person

Technical information contained in this MD&A has been prepared by or under the supervision of Mr. William McGuinty, P. Geo., consulting geologist and technical advisor to Palamina, who acted as a Qualified Person ("QP") as defined by National Instrument 43-101 - "Standards of Disclosure for Mineral Projects ("NI 43-101"). Mr. McGuinty has reviewed work practices and verified the data comprising such technical information, including sampling, analytical and test data underlying the information or opinions contained in this MD&A.

In addition, Mr. Yury Valdivieso, Palamina's lead geologist and project manager in Peru, is responsible for the execution of all exploration programs. Mr. Valdivieso has a MSc. in economic geology and is a member of the Society of Economic Geologists ("SEG"), the Geological Society of Peru ("SGP") and the College of Engineers of Peru ("CIP").

Palamina Corp.

Management's Discussion & Analysis

For the Year Ended December 31, 2022

Overview

Palamina is an exploration stage company focused on the exploration for economic mineral deposits in Peru through its wholly owned subsidiary, Palamina SAC ("Palamina Peru"), and to a lesser extent in Mexico through its wholly owned subsidiary, Palamina S.A. de C.V. ("Palamina Mexico"). Palamina was incorporated on April 23, 2015 under the Business Corporations Act (Ontario). The Company's head office is located at 145 King Street West, Suite 2870 Toronto, Ontario M5H 1J8. Palamina is a reporting issuer pursuant to the securities laws of Ontario, British Columbia, Alberta, and Saskatchewan and is listed in Canada on the TSX Venture Exchange ("TSX-V") under the symbol PA and in the United States on the OTCQB under the symbol PLMNF.

Management's strategy for building Palamina into a profitable resource company and maximizing shareholder value is to acquire and explore properties with the potential to host significant economic deposits within prolific mining districts in Peru. The Company explores primarily for gold and silver, with the objective of enhancing the value of its properties either by direct exploration or through option or joint venture agreements with third parties. This strategy diversifies the business risks inherent in developing a single property. Palamina owns 13,422,000 common shares and holds 1,321,000 warrants of Windshear Gold Corp. ("Winshear") representing an approximate 19.9% interest on a partially diluted basis. Winshear is listed on the TSX-V under the symbol WINS.

Corporate Highlights - January 1, 2022 to May 1, 2023

• On April 4, 2023 a complete video recording of the evidentiary hearing of Winshear's arbitration against the United Republic of Tanzania ("Tanzania") was posted online at:

https://www.youtube.com/@internationalcentreforsett919/videos?app=desktop

• On February 21, 2023 Palamina's equity partner Winshear, concluded arbitration proceedings against the Government of Tanzania for the expropriation of its SMP Gold Project.
• On November 30, 2022 Palamina appointed Peter Bojtos P. Eng. as a new director and Michael Farrant as Chief Financial Officer ("CFO") replacing departing director Hugh Agro and departing CFO Brian Jennings.
• On September 12, 2022 Palamina received a US$50,000 (CDN$64,685) Advance Royalty payment from Winshear, pursuant to a property purchase agreement dated September 19, 2019.
• On August 19, 2022, Winshear closed an oversubscribed private placement of units at $0.06 per unit for gross proceeds of $651,300. Palamina subscribed for 1,550,000 units, to hold of 13,422,000 shares and 1,321,000 warrants to maintain is approximate 19.9% interest on a partially diluted basis.
• In February 2022, Palamina added Jerry Blackwell, P. Geo. as a geological consultant and Renzo Ceccarelli Lombardi, M.Sc.F. as an environmental and social management consultant.

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Palamina Corp.

Management's Discussion & Analysis

For the Year Ended December 31, 2022

Operational Highlights - January 1, 2022 to May 1, 2023

• On April 5, 2023 Palamina received approval of the modification of its Declaracion de lmpacto Ambiental ("DIA") at the Usicayos Gold Project which will allow for drilling of the Sol de Oro and Cayos gold zones.
• On January 23, 2023, Palamina announced channel sampling assays of 5.1 grams per tonne gold ("g/t Au") over 4 metres at surface and 15.4 g/t Au over 2.7 metres underground at the Usicayos Gold Project.
• In November 2022, a drone-supported orthophoto and topographic survey over the main mineralized trend at the Usicayos Gold Project was completed to follow up mapping and sampling in the Sol de Oro Zone.
• In October 2022, a preliminary site visit of the Yin gold claim south west of Winshear's Yang gold claim was completed in order to investigate an Artificial Intelligence ("AI") target area identified by GoldSpot Discoveries Corp. ("Goldspot").
• On October 7, 2022, Winshear, received its environmental permit or DIA, on the Gaban Gold Project from the Peruvian Ministry of Mines.
• In September 2022, field work completed in the newly acquired Sol de Oro Zone at the Usicayos Gold Project returned values up to 0.9 metres of 200 g/t Au. Multiple other occurrences with visible gold were noted during prospecting.
• In September 2022, results from mapping and sampling were reported in addition to the land position increasing to 12,830 hectares at Palamina's Galena Silver-Copper Project.
• In September 2022 the Peruvian Ministry of Mines accepted the Company's modification to its environmental permit or DIA, on Palamina's Usicayos Gold Project to include the Cayos and Sol de Oro zones.
• In August 2022, drone surveying and reconnaissance sampling and mapping programs were carried out at the Inca Gold, Cristel Gold and Panorama Gold projects.
• In July and August of 2022, mapping / sampling programs were carried out on the Usicayos Gold and Galena Silver Copper Projects.
• On July 26, 2022, Palamina announced drill results from 2 diamond drillholes completed in the Veta Zone in May 2022.
• On July 4 and 5, 2022, Palamina Peru acquired two internal titled mineral concessions from two separate owners totaling 130 hectares within the Galena Silver Copper Project securing two historical mine areas.
• On June 10, 2022, Palamina Peru acquired an internal claim covering 200 hectares within the Usicayos Gold Project, securing 100% of the main mineralized gold trend.
• On May 16, 2022, Palamina resumed diamond drilling in the Veta Zone at the Usicayos Gold Project.
• On May 3, 2022, Palamina staked the Yin and Cristel Gold Projects in the Puno Orogenic Gold Belt.

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Palamina Corp.

Management's Discussion & Analysis

For the Year Ended December 31, 2022

• In March 2022, Palamina staked an additional 2,400 hectares at its Galena Silver-Copper Project (formerly known as the Lagos Project) based on recommendations from Goldspot. Palamina also initiated a mapping and sampling program in the Gris and Santa Rosa Zones at Galena.
• In February 2022, Palamina contracted Geades Consulting SAC to complete an FTA (Ficha Tecnica Ambiental or "Environmental Permit") at the Galena Silver-Copper Project to allow up to 40 drillholes from 20 drill platforms.

Peru Properties

Focus on Puno Orogenic Gold Belt

The Puno Orogenic Gold Belt ("POGB") is an auriferous, southeasterly trending metasedimentary-hosted belt located in southern Peru which follows the Andean trend and covers an area of approximately 175 km NW-SE by up to 75 km NE-SW in the Puno region of Peru. The POGB is a section of a larger 3,400 km long belt of orogenic gold deposits extending from Argentina in the south, through Bolivia and the Puno region, to the Pataz region in northern Peru. The POGB is flanked on the northeast by the gold producing Madre de Dios region in Peru. The belt contains numerous orogenic gold occurrences. Palamina's exploration targets in this region are 'pizarra' or slate-hosted gold systems.

Orogenic gold mineralization in the Puno region occurs in association with regional-scale structures, generally hosted by deformed and folded slates and related metasediments. Palamina is targeting continuous, tabular zones of orogenic gold mineralization within fine-grained, sheared, locally metamorphosed sedimentary rocks. Mineralization may occur in discrete, stacked horizons as bedding- or shear-parallel horizons within the host rock. Gold mineralization typically consists of native gold in distinctive "packages" of fine-grained quartz veins, veinlets and micro-veinlets. Globally, orogenic-type gold deposits are known to extend to vertical depths greater than 1,000 m. Important examples of slate hosted deposits in the POGB in Peru include Ollachea & La Rinconada.

The orogenic gold belt in Puno hosts more than 100 known hard-rockgold-mineralized occurrences and over 50 mining operations are being operated by small and medium-scale artisanal miners. Palamina believes the POGB has considerable potential to contain a compelling number of additional yet undiscovered orogenic gold deposits. Erosion of these gold-bearing structures (by both fluvial and glacial processes) are widely considered to be the source for the extensive alluvial gold deposits located in the low-lying Madre de Dios region of Peru's Amazon basin.

There has been a significant up-grading of road access in the Puno region (example: Pacific-Atlantic

interoceanic highway) and power infrastructure (example: 206 MW San Gaban hydro-electric facility). It is Palamina's belief that these infrastructure developments greatly assist exploration of the POGB and will well support future mine developments in the region.

Airborne Geophysical Survey

Orogenic gold mineralization in the POGB frequently has an association with pyrrhotite (an iron sulphide mineral that is magnetic), associated with swarms of quartz veins and veinlets generally restricted to discrete, continuous packages in regional shear zone structures hosted by fine-grained sedimentary units. In August 2018. New-Sense Geophysics Limited completed an approximate 3,000-line km helicopter-borne magnetic/radiometric geophysical survey overPalamina's Usicayos and Cori gold projects and Winshear's Gaban gold project in the POGB. This geophysical study is being used to assist in identifying drill targets at Usicayos and in locating further shear zones under cover on the Gaban and Cori Projects.

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Palamina Corp.

Management's Discussion & Analysis

For the Year Ended December 31, 2022

Comparison with other Gold Projects in the POGB:

The Ollachea orogenic gold deposit, located 60 km northwest of Usicayos, reportedly occurs along a structurally deformed east-west trending regional shear structure on the edge of the SE trending POGB. Similarly, 75 km southeast of Usicayos, the large orogenic gold occurrence at La Rinconada also features a significant east-west inflection zone. Midway between Ollachea and La Rinconada, the Usicayos Gold Project also lies along a comparably deformed east-west trending structural jog.

GoldSpot Discoveries Corp. Study of the POGB and Santa Lucia Districts

GoldSpot along with Eric Sprott, participated for 15% of Palamina's June 30, 2021 financing. GoldSpot has since been contracted to complete an Artificial Intelligence study of the POGB and Santa Lucia districts to generate AI target areas with the potential to host significant mineralization based on known data processed through their machine learning technologies. In the first quarter of 2022, GoldSpot presented Palamina with its interim results. The most significant of the AI target areas was subsequently covered by the Company's YIN claim in May 2022.

Usicayos Gold Project

At the Usicayos Gold Project, Palamina has applied for the mineral rights and has title to 14,012 hectares of mineral concessions. The Usicayos Gold Project is located near the town of Usicayos (centrally located along the western periphery of the POGB). The Usicayos concessions extend east and west of the town of Usicayos at elevations ranging from 3,200 to 4,700 m. Rock exposure in the area is generally excellent as the properties sit predominantly above the tree line.

At Usicayos, Palamina has prioritized a 2.4 km section of a 4.5 km mineralized gold trend for drilling consisting of 3 separate gold zones trending southwest to northeast for drilling; Sol de Oro, Cayos and Veta. Veta was the initial discovery zone followed by the Cayos zone and more recently the Sol de Oro zone. In September of 2021 Palamina started its inaugural diamond drill program in the Veta Zone and completed 4 diamond drill holes over a 600-metre strike length before commencement of the rainy season in mid-December 2021. Drilling in the Veta Zone was designed to test multiple mineralized gold structures defined at surface over an 800-metre strike length. In May of 2022 Palamina resumed drilling with two additional drill holes scheduled to test the remaining 200 metres of mineralized strike length to the northeast; Drill holes VE-05-22 and hole VE-06-22 were both completed from a fifth drill pad.

The geological make-up of the 4.5 km SW-NE mineralized trend is dominated by low grade metamorphosed sequences of fine-grained sedimentary rocks including siltstone and shale with lesser mudstone and fine-grained sandstone units. SW-NE trending domains of intense shearing, folding and faulting of the sedimentary sequences is variably evident throughout area. Individual quartz veins range between millimetric and 40 cm wide. Quartz veins can occur in isolation, sheeted/sub-parallel or as localised stockwork and carry a variable sulphide content of pyrite and minor pyrrhotite. Minor amounts of arsenopyrite are also associated with gold. Gold generally occurs as coarse, visible grains, wires and plates.

In December of 2019, Palamina received approval of its DIA which allows for up to 40 drill pads to be constructed in the Veta Zone at Usicayos. Palamina is modifying its DIA in order to allocate a portion of the drill pads to the nearby Cayos and Veta NE zones. On May 4, 2021Palamina received its Authorization to Initiate Exploration Activities ("AIEA") permit to commence drilling in the Veta Zone on its Usicayos Gold Project in Peru.

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