Prime Mining : Earnings Document

MANAGEMENT'S DISCUSSION AND ANALYSIS

For the three and six months ended

June 30, 2023 and 2022

PRIME MINING CORP.

Management's Discussion and Analysis

For the three and six months ended June 30, 2023 and 2022

(In Canadian dollars, except where noted)

The following is management's discussion and analysis ("MD&A") of Prime Mining Corp. together with its wholly owned subsidiaries (the "Company" or "Prime"), is prepared as of August 16, 2023, and relates to the financial condition and results of operations for the three and six months ended June 30, 2023 and 2022. Past performance may not be indicative of future performance. This MD&A should be read in conjunction with the condensed interim consolidated financial statements ("interim financial statements") and related notes for the three and six months ended June 30, 2023 and 2022, which have been prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board ("IFRS"). As such, these interim financial statements do not contain all the disclosures required by IFRS for annual financial statements and should be read in conjunction with the Company's audited annual consolidated financial statements for the year ended December 31, 2022, the eight months ended December 31, 2021 and the year ended April 30, 2021 ("annual financial statements").

The three months ended June 30, 2023 and 2022, are also referred to as "Q2 2023" and "Q2 2022", respectively. The six months ended June 30, 2023 and 2022, are also referred to as "YTD 2023" and "YTD 2022", respectively. All amounts are presented in Canadian dollars, the Company's presentation currency, unless otherwise stated. References to "US$" and "MXN" are to United States dollars and Mexican pesos, respectively.

Certain information contained in this MD&A may constitute forward-looking statements. Statements in this report that are not historical facts are forward-looking statements involving known and unknown risks and uncertainties, which could cause actual results to vary considerably from these statements. Readers are cautioned not to put undue reliance on forward-looking statements. Refer to the "Risks and Uncertainties" and "Cautionary Note Regarding Forward-Looking Statements" sections of this document.

OVERVIEW OF THE BUSINESS

The Company was incorporated on May 14, 1981 in British Columbia. Prime is a reporting issuer in British Columbia and Alberta, and a Tier 2 issuer on the TSX Venture Exchange ("TSX-V"). The Company's head office and principal place of business is located at Suite 710 - 1030 West Georgia Street, Vancouver, BC, V6E 2Y3. The Company has wholly owned subsidiaries in Suriname, Mexico and Barbados although only the Mexican subsidiaries are active. The Company is focused on advancing gold exploration properties in Mexico with the potential to be brought to near- term production.

The Company's common shares are traded on the TSX-V under the symbol "PRYM", on the Frankfurt Stock Exchange under the symbol "O4V3" and on the OTCQX market under the symbol "PRMNF".

As Prime works to advance the Los Reyes Gold and Silver Project ("Los Reyes" or the "Los Reyes Project"), the Company's focus is on three areas:

1. health and safety of our team and the communities we work in;
2. use of resources to create maximum value at Los Reyes; and
3. corporate responsibility and governance.

During the six months ended June 30, 2023, the Company has seen progress in all three areas with continued emphasis on operating under appropriate covid-19 guidelines, strengthened exploration team performance and advances in our corporate administration.

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PRIME MINING CORP.

Management's Discussion and Analysis

For the three and six months ended June 30, 2023 and 2022

(In Canadian dollars, except where noted)

Los Reyes Gold and Silver Project

Located 43 kilometres south-east of the mining centre of Cosala, Sinaloa, Los Reyes has a mining history that stretches back into the 1700s and has seen small-scale mining activity as recently as the 1980s. In the 1990s, Northern Crown Mines Ltd. explored the property, drilling 381 reverse circulation holes and commissioned a resource estimate and prefeasibility study on the Zapote deposit. Los Reyes was returned to the original concession holders in the early 2000s. Vista Gold Corp. ("Vista Gold") reassembled the land package and drilled 48 core holes in several of the deposits. Vista Gold also completed metallurgical test work and had a resource estimate calculated and a preliminary economic assessment made. Great Panther Silver Ltd optioned the property in 2014, through the acquisition of CanGold Ltd., and drilled 41 core holes in 2015. Minera Alamos Inc. ("MAI") optioned the property from Vista Gold in 2017. Prime acquired the option from MAI in 2019 and began a surface exploration program of mapping, trenching and roadcut channel sampling. Prime subsequently exercised the option with Vista Gold in 2020.

The Company believes that the Los Reyes Project is an overlooked, underexplored, low-sulphidation epithermal gold- silver project located in a prolific mining region of Mexico. Previous operators completed various prefeasibility studies yet held back from development due to then-prevailing declining gold prices. The Company further believes that work that has been completed has provided sufficient understanding of existing resources to allow Los Reyes to be fast-tracked to production. However, Los Reyes holds gold and silver exploration optionality. It is a large epithermal system with the bulk of historic exploration conducted over less than 40% of the known structures leaving significant opportunity to expand known resources.

COVID-19

The Company is at the exploration stage and while individuals working for the Company may contract covid-19, the business operation is unlikely to be materially affected in the short term. The Company does not rely on specific materials, laboratories or suppliers. It is quite possible however, that exploration activities could be delayed by covid- 19 and travel restrictions could limit the ability of non-Mexico-based managers to be on-site in Mexico. However, management does not believe that such delays will have a material bearing on progress on the Company's exploration program.

The Company will need to raise funds to continue exploration and, if warranted, development of its properties. As a result of covid-19's adverse effect on financial markets, this could manifest itself in the Company having difficulty in financing longer-term activities. At this date, it is not possible to determine what affect, if any, covid-19 will have on the ability of the Company to finance its development.

HIGHLIGHTS AND KEY DEVELOPMENTS

Los Reyes Project

The 2023 drill program commenced January 1, 2023. Currently, four core drills are in operation.

Refer to the Outlook section below for details pertaining to the planned objectives of the 2023 drill program.

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PRIME MINING CORP.

Management's Discussion and Analysis

For the three and six months ended June 30, 2023 and 2022

(In Canadian dollars, except where noted)

Exploration activities during the three months ended June 30, 2023

In May 2023, the Company reported an updated mineral resource estimate (MRE) based on 100,000 m of Prime drilling resulting in a doubling of the April 2020 resource, with a discovery cost of approximately US$25 per gold equivalent ("AuEq") ounce ("oz"). At the resource gold cut-off grade of 0.22 gpt, Prime's updated open pit MRE contains:

• 1.47 million Indicated AuEq ounces at a 1.68 gpt average grade. This represents a 73% increase in Measured and Indicated AuEq ounces, and 26% increase in AuEq grade. This is 1.0 million ounces of gold at 1.16 gpt and 35 million ounces of silver at 40.4 gpt.
• 0.73 million Inferred AuEq ounces at a 1.26 gpt average grade. This represents a 175% increase in AuEq ounces and 8% increase in AuEq grade. This is 0.5 million ounces of gold at 0.85 gpt and 18.4 million ounces of silver at 31.5 gpt.

The MRE has a high-grade open pit mill resource and a lower grade heap leach portion. The MRE includes drilling completed before December 31, 2022 from only the three main zones at Los Reyes: Guadalupe, Z-T and Central. The resource areas remain open along strike and at depth.

The majority of the Los Reyes resource is contained within a high-grade envelope. For example, at a 1.0 gpt gold cut- off, the Los Reyes MRE contains in excess of 1.0 million gold equivalent ounces at an average grade of 3.70 gpt AuEq in the Indicated category and 374,000 ounces at a grade of 3.07 gpt AuEq in the Inferred category.

This MRE does not include positive results from the highly prospective exploration targets outlined in Prime's February 27th news release such as Mariposa, Las Primas and Fresnillo. Since the calculation of the MRE, Prime has drilled another +30,000 m.

With ongoing drilling success, the Company believes there is significant potential to expand the MRE.

Gold equivalent grades are calculated as in-situ contained grades, applying the assumed ratio of gold to silver prices using the following formula: AuEq grade (gpt) = Gold grade (gpt) + Silver grade (gpt) x (US$22 /US$1,700). Relative recoveries are not considered in the in-situ contained grade estimate but are stated below and utilized in the resource shell economic pit constraints.

The MRE is based on economically constrained pits using the following optimization parameters (all dollar values are in US dollars):

• US$1,700/ounce gold price and US$22/ounce silver price;
• mill recoveries of 93% and 83% for gold and silver, respectively; heap leach recoveries of 73% and 25% for gold and silver, respectively;
• 45-degreepit slopes, with an assumed 5% ore loss and 5% dilution factor applied to the 5x5x5m resource block model;
• mining costs of $2.00 per tonne of waste mined and $2.50 per tonne of ore mined;
• milling costs of $15 per tonne processed and heap leaching costs of $4 per tonne processed;
• G&A of $1.60 per tonne processed; 3% royalty costs and 1% selling costs were also applied; and,
• unless otherwise noted, an overall 0.22 g/T gold cut-off was applied to all ore blocks.

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PRIME MINING CORP.

Management's Discussion and Analysis

For the three and six months ended June 30, 2023 and 2022

(In Canadian dollars, except where noted)

Also in May 2023, the Company reported drill results from 14 drill holes drilled in the Z-T Area, all outside of the updated May 2023 resource pit shell which includes the Company's drill results from the 2021-2022 drilling campaigns. Highlights from these 14 holes include: 3.33 gpt Au and 220.9 gpt Ag (6.19 gpt AuEq) over 12.0 metres ("m") (11.6 m estimated true width ("etw")), including 24.0 gpt Au and 1,385.0 gpt Ag (41.92 gpt AuEq) over 1.0 m (1.0 m etw) in hole 23TA-64; 1.52 gpt Au and 24.8 gpt Ag (1.84 gpt AuEq) over 10.0 m (9.8 m etw) including 7.94 gpt Au and 61.4 gpt Ag (8.73 gpt AuEq) over 1.5 m (1.5 m etw) in hole 23TA-57; 1.03 gpt Au and 34.5 gpt Ag (1.48 gpt AuEq) over 5.3 m (4.5 m etw) including 2.69 gpt Au and 52.5 gpt Ag (3.37 gpt AuEq) over 1.3 m (1.1 m etw) in hole 23TA-60; 0.96 gpt Au and 27.3 gpt Ag (1.31 gpt AuEq) over 19.5 m (13.8 m etw) and 0.84 gpt Au and 14.4 gpt Ag (1.02 gpt AuEq) over 12.0 m (8.5 m etw) in hole 23ZAP-98; 0.74 gpt Au and 36.9 gpt Ag (1.22 gpt AuEq) over 16.5 m (15.9 m etw) including 2.72 gpt Au and 155.4 gpt Ag (4.73 gpt AuEq) over 1.5 m (1.4 m etw) in hole 23ZAP-95A; and

1.01 gpt Au and 23.3 gpt Ag (1.31 gpt AuEq) over 12.0 m (8.5 m etw) and 0.79 gpt Au and 22.8 gpt Ag (1.09 gpt AuEq) over 4.2 m (3.0 m etw) in hole 23ZAP-99.

In June 2023, the Company reported an additional four holes from the Z-T Area including: 3.96 gpt Au and 88.0 gpt Ag (5.10 gpt AuEq) over 11.4 m etw in hole 23TA-67, including 24.50 gpt Au and 209.0 gpt Ag (27.20 gpt AuEq) over

1. m etw; 3.80 gpt Au and 82.0 gpt Ag (4.86 gpt AuEq) over 13.3 m etw in hole 23TA-69, including 8.15 gpt Au and

1. gpt Ag (9.30 gpt AuEq) over 3.7 m etw. These two holes are located 200m and 100 m, respectively, below the MRE resource pit (May 2023) and define two high-grade mineralized shoots separated by 250 m. These intercepts open a significant area of exploration upside relative to the MRE pit shell for the Z-T Area. They suggest a potential merging of the western, shallow plunging mineralized shoot encountered by hole 23TA-67 and the eastern, steeply plunging mineralized shoot intercepted by 23TA-69.

Exploration activities after June 30, 2023

In July 2023, the Company reported drill results from nine core holes at the Central Area. Highlights included: 4.11 gpt Au and 67.9 gpt Ag (4.99 gpt AuEq) over 9.1 m etw in hole 23NB-46, including 31.40 gpt Au and 470.0 gpt Ag (37.48 gpt AuEq) over 1.1 m etw; 1.23 gpt Au and 20.5 gpt Ag (1.50 gpt AuEq) over 14.0 m etw in hole 23NB-39, including 4.19 gpt Au and 76.0 gpt Ag (5.17 gpt AuEq) over 2.0 m etw; and 1.86 gpt Au and 30.2 gpt Ag (2.25 gpt AuEq) over 5.7 m etw in hole 23NB-40, including 4.75 gpt Au and 67.6 gpt Ag (5.62 gpt AuEq) over 1.4 m etw. These holes were drilled at Noche Buena, located in the southeastern-most end of the Central Area up to 150 m along strike from the bottom of the recently announced resource pit (May 2023). These holes confirm the ongoing expansion of potential gold-silver resources in addition to and not included in the Company's MRE.

News releases with supporting technical data

Refer to the following news releases, published on SEDAR, for additional technical data:

• "Prime Mining Doubles High-Grade Los Reyes Gold-Silver Resource" dated May 2, 2023.
• "PRIME DRILLS NEW MULTIPLE WIDE, HIGH-GRADE INTERCEPTS IN Z-T AREA INCLUDING BONANZA-GRADE INTERVALS" dated May 24, 2023.
• "PRIME DISCOVERS NEW WIDE ZONES OF HIGH-GRADE MINERALIZATION IN Z-T AREA SIGNIFICANTLY BELOW RESOURCE PITS" dated June 20, 2023.
• "PRIME EXTENDS MINERALIZATION BEYOND LOS REYES RESOURCE PIT AT CENTRAL AREA" dated July 11, 2023.

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