Probe Gold : Fourth Quarter Report for the Period Ending December 31, 2023

FINANCIAL STATEMENTS OF

PROBE GOLD INC.

FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 (EXPRESSED IN CANADIAN DOLLARS)

Independent Auditor's Report

To the Shareholders of Probe Gold Inc.:

Opinion

We have audited the financial statements of Probe Gold Inc. (the "Company"), which comprise the statements of financial position as at December 31, 2023 and December 31, 2022, and the statements of loss and comprehensive loss, changes in shareholders' equity and cash flows for the years then ended, and notes to the financial statements, including material accounting policies.

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Company as at December 31, 2023 and December 31, 2022, and its financial performance and its cash flows for the years then ended in accordance with International Financial Reporting Standards.

Basis for Opinion

We conducted our audits in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audits of the financial statements in Canada, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period. We have determined that there are no key audit matters to communicate in our report.

Other Information

Management is responsible for the other information. The other information comprises Management's Discussion and Analysis.

Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audits of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audits or otherwise appears to be materially misstated. We obtained Management's Discussion and Analysis prior to the date of this auditor's report. If, based on the work we have performed on this other information, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of Management and Those Charged with Governance for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with International Financial Reporting Standards, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Company's financial reporting process.

MNP LLP

1 Adelaide Street East, Suite 1900, Toronto ON, M5C 2V9

1.877.251.2922 T: 416.596.1711 F: 416.596.7894

Auditor's Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

•  Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

•  Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control.

•  Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

•  Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern.

•  Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audits and significant audit findings, including any significant deficiencies in internal control that we identify during our audits.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

The engagement partner on the audit resulting in this independent auditor's report is Brock Stroud.

Toronto, Ontario March 29, 2024

Chartered Professional Accountants

Licensed Public Accountants

1 Adelaide Street East, Suite 1900, Toronto, Ontario, M5C 2V9 1.877.251.2922 T: 416.596.1711 F: 416.596.7894 MNP.ca

Statements of Financial Position (Expressed in Canadian Dollars)

As at December 31,

2023

2022

ASSETS

Current assets

Cash and cash equivalents Other receivables (note 5) Marketable securities (note 6) Prepaid expenses

$

25,233,467 $ 23,557,285 1,391,920 2,734,635 767,789 3,280,178

79,386

179,130

Total current assets

Non-current assets

Quebec refundable tax credits and mining duties refund receivable Reclamation bonds (note 7)

Property and equipment (note 8) Rights-of-use assets (note 9)

27,472,562 29,751,228

4,852,680 2,952,428

1,016,195 413,050

538,116 596,684

442,806 549,948

Total non-current assets Total assets

6,849,797 4,512,110

$

34,322,359

$ 34,263,338

LIABILITIES AND EQUITY

Current liabilities

Amounts payable and other liabilities (notes 10 and 20)

Current portion of lease liability (note 11)

RSU liability (note 16)

Flow-through share liability (note 12)

$

1,526,865

$ 2,127,809

96,076 65,241

592,114 637,550

Total current liabilities

Non-current liabilities

Lease liability (note 11)

Restoration liabilities (note 7)

4,516,742 6,731,797

- 2,830,600

417,352

513,427

1,489,899 1,018,865

Total non-current liabilities Total liabilities

1,907,251 1,532,292

8,639,048 4,362,892

Equity

Share capital (note 13) Warrants (note 14)

Contributed surplus (notes 15 and 16) Accumulated deficit

167,359,081 145,792,683

3,679,449 3,679,449

8,555,805 8,888,468

(153,911,024)

(128,460,154)

Total equity

25,683,311 29,900,446

Total liabilities and equity

$

34,322,359

$ 34,263,338

The accompanying notes are an integral part of these financial statements.

Nature of operations (note 1)

Commitments (note 21)

Subsequent events (note 24)

Approved on behalf of the Board:

"David Palmer", Director

"Jamie Horvat", Director

Statements of Loss and Comprehensive Loss (Expressed in Canadian Dollars)

Year ended

December 31, 2023 2022

Operating expenses

Exploration and evaluation expenditures (note 18)

General and administrative expenses (note 19)

$ 24,164,848 6,498,062

$ 27,316,526 5,326,177

Operating loss before interest and other income, accretion expense, premium on flow-through shares realized gain on sale of marketable securities, unrealized gain on marketable securities and gain on lease modification

Interest and other income

Accretion expense (notes 7 and 11)

Premium on flow-through shares (note 12)

Realized gain on sale of marketable securities (note 6) Unrealized (loss) gain on

marketable securities (note 6)

Gain on lease modification (note 11)

(30,662,910)

(32,642,703)

1,136,471

750,763

(117,039)

(122,481)

3,013,010

475,061

2,622,451 -

• 752,161 (566,478)

-

38,989

Loss and comprehensive loss for the year Basic and diluted loss per share (note 17) Weighted average number of common shares outstanding - basic and diluted

$(25,403,246) $(29,919,459)

$

(0.16) $

(0.20)

161,720,745

150,476,991

The accompanying notes are an integral part of these financial statements.

Statements of Cash Flows (Expressed in Canadian Dollars)Year ended

December 31, 2023 2022

Operating activities:

Net loss for the year	$ (25,403,246)	$ (29,919,459)
Adjustments for:
Share-based payments (notes 15 and 16)	2,965,529	2,125,007
Depreciation (notes 8 and 9)	191,642	188,767
Accrued interest receivable	81,893	89,545
Realized gain on sale of marketable securities (note 6)	(475,061)	-
Unrealized (gain) loss on marketable securities (note 6)	(752,161)	566,478
Shares issued to acquire mineral property (note 13(b)(iv) and (v))	2,581,301	-
Premium on flow-through share (note 12)	(3,013,010)	(2,622,451)
Accretion expense (notes 7 and 11)	117,039	122,481
Restoration fees (note 7)	431,106	(639,006)
Gain on lease modification (note 11)	-	(38,989)
Quebec refundable tax credits and mining duties refund receivable accrued	(1,900,252)	(2,952,428)
Changes in non-cash working capital items:
Other receivables	1,260,824	(1,983,394)
Prepaid expenses	99,744	(112,649)
Amounts payable and other liabilities	(600,944)	795,133
Net cash used in operating activities	(24,415,596)	(34,380,965)
Investing activities:
Proceeds from sale of marketable securities	3,739,611	-
Purchase of property and equipment (note 8)	(25,932)	(150,134)
Purchase of reclamation bonds (note 7)	(603,146)	-
Net cash provided by (used in) investing activities	3,110,533	(150,134)
Financing activities:
Cash paid for RSUs (note 16)	(695,244)	-
Proceeds from private placements (note 13(b))	24,999,956	31,270,000
Share issue costs	(1,853,642)	(2,008,748)
Exercise of warrants	-	8,450
Exercise of stock options	672,526	136,000
Lease payments (note 11)	(142,351)	(183,973)
Net cash provided by financing activities	22,981,245	29,221,729
Net change in cash and cash equivalents	1,676,182	(5,309,370)
Cash and cash equivalents, beginning of year	23,557,285	28,866,655
Cash and cash equivalents, end of year	$ 25,233,467	$ 23,557,285
Supplemental cash flow information
Cash received for interest	$ 1,064,057
The accompanying notes are an integral part of these financial statements.
-3-

$

624,157

Probe Gold Inc.

Statements of Changes in Shareholders' Equity (Expressed in Canadian Dollars)

Equity attributable to shareholders

Share capitalWarrantsContributed surplusAccumulated deficitTotalBalance, December 31, 2021

Private placement (note 13(b)(i)(ii)) Warrants (note 13(b)(i)(ii))

Share issue costs Flow-through share premium Exercise of warrants Exercise of stock options Warrants expired

Share-based payments (notes 15 and 16) Loss and comprehensive loss

$122,578,430 $ 31,270,000

1,074,738 -

(3,679,449) 3,679,449

$

6,942,813 $ (99,615,433) $ 30,980,548

- -- -

31,270,000 -

(2,008,748) - - - (2,008,748)

(2,622,451) - - - (2,622,451)

8,450 - - - 8,450

246,451 - - - $145,792,683 $

- (1,074,738)

(110,451) - 136,000

- - 3,679,449 - - - - - - - - - 3,679,449

- 2,056,106 -1,074,738 - (29,919,459)

- 2,056,106 (29,919,459)

Balance, December 31, 2022

Shares issued to acquire mineral property (note 13(b)(iv) and (v)) Private placements (note 13(b)(iii) and (vi))

Shares issue costs

Flow-through share premium (note 12(i) and (ii)) RSUs vested (note 16)

Exercise of stock options Stock options expired

Share-based payments (notes 15 and 16) Loss and comprehensive loss

2,581,301

24,999,956

(1,853,642)

(7,529,752)

755,034

$

8,888,468 $(128,460,154) $ 29,900,446

2,613,501 - - - $167,359,081 $

- - - - (988,652) (1,940,975)

(4) 2,596,968 -

4 - (25,403,246)

-	2,581,301
-	24,999,956
-	(1,853,642)
-	(7,529,752)
(47,628)	(281,246)
-	672,526
-
2,596,968
(25,403,246)

Balance, December 31, 2023

$

8,555,805 $(153,911,024) $ 25,683,311

The accompanying notes are an integral part of these financial statements.

-4-

Notes to Financial Statements December 31, 2023 and 2022 (Expressed in Canadian Dollars)

1. Nature of Operations

Probe Gold Inc. (the "Company" or "Probe") was incorporated pursuant to the Business Corporations Act (Ontario) under the name "2450260 Ontario Inc." on January 16, 2015. Articles of amendment were subsequently filed on February 3, 2015 to change the name of the Company to "Probe Metals Inc." and on January 9, 2023 to change the name of the Company to "Probe Gold Inc.". The Company's head office is located at 56 Temperance Street, Suite 1000, Toronto, Ontario, Canada, M5H 3V5. The Company's common shares started trading on the TSX Venture Exchange ("TSXV") on March 17, 2015 under the trading ticker symbol "PRB". On January 27, 2023, the Company's common shares started trading on the Toronto Stock Exchange ("TSX") and ceased trading on the TSXV. The Company's symbol remained "PRB'. The Company, a Canadian precious metal exploration company, was formed following the acquisition of Probe Mines Limited by Goldcorp Inc. pursuant to the arrangement announced on January 19, 2015.

Probe is a Canadian gold exploration company focused on the acquisition, exploration and development of highly prospective gold properties. The Company is committed to discovering and developing high-quality gold projects, including its key asset the multimillion-ounce Novador (formerly Val-d'Or East Gold Project), Québec.

The financial year end of the Company is December 31st.

2. Material Accounting Policies

Statement of Compliance

These financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB") and the interpretations issued by the IFRS Interpretations Committee.

The financial statements are presented in Canadian dollars, the Company's functional currency, and have been prepared on a historical cost basis.

The financial statements were authorized for issue by the Board of Directors on March 28, 2024.

Financial Instruments

IFRS 9 - Financial Instruments ("IFRS 9") includes finalized guidance on the classification and measurement of financial assets. Under IFRS 9, financial assets are classified and measured either at amortized cost, fair value through other comprehensive income ("FVOCI") or fair value through profit or loss ("FVTPL") based on the business model in which they are held and the characteristics of their contractual cash flows.

All financial assets not classified at amortized cost or FVOCI are measured at FVTPL. On initial recognition, the Company can irrevocably designate a financial asset at FVTPL if doing so eliminates or significantly reduces an accounting mismatch.

A financial asset is measured at amortized cost if it meets both of the following conditions and is not designated at FVTPL:



It is held within a business model whose objective is to hold the financial asset to collect the contractual cash flows associated with the financial asset instead of selling the financial asset for a profit or loss;



Its contractual terms give rise to cash flows that are solely payments of principal and interest.

Notes to Financial Statements December 31, 2023 and 2022 (Expressed in Canadian Dollars)

2. Material Accounting Policies (Continued)

Financial Instruments (continued)

Financial liabilities are classified as either financial liabilities at FVTPL or at amortized cost. The Company determines the classification of its financial liabilities at initial recognition.

Financial liabilities are classified as measured at amortized cost unless they fall into one of the following categories: financial liabilities at FVTPL, financial liabilities that arise when a transfer of a financial asset does not qualify for derecognition, financial guarantee contracts, commitments to provide a loan at a below-market interest rate, or contingent consideration recognized by an acquirer in a business combination.

Financial liabilities are classified as FVTPL if they fall into one of the five exemptions detailed above.

Transaction costs associated with financial instruments, carried at FVTPL, are expensed as incurred, while transaction costs associated with all other financial instruments are included in the initial carrying amount of the asset or the liability.

All financial instruments are initially recognized at fair value on the statement of financial position. Subsequent measurement of financial instruments is based on their classification. Financial assets and liabilities classified at FVTPL are measured at fair value with changes in those fair values recognized in the statement of loss and comprehensive loss for the period. Financial assets classified at amortized cost and financial liabilities are measured at amortized cost using the effective interest method.

The Company derecognizes financial liabilities only when its obligations under the financial liabilities are discharged, cancelled, or expired. The difference between the carrying amount of the financial liability derecognized and the consideration paid and payable, including any non-cash assets transferred or liabilities assumed, is recognized in profit or loss.

IFRS 9 introduced a single expected credit loss impairment model, which is based on changes in credit quality since initial application. The adoption of the expected credit loss impairment model had no impact on the Company's financial statements.

The Company assumes that the credit risk on a financial asset has increased significantly if it is more than 30 days past due. The Company considers a financial asset to be in default when the borrower is unlikely to pay its credit obligations to the Company in full or when the financial asset is more than 90 days past due.

The carrying amount of a financial asset is written off (either partially or in full) to the extent that there is no realistic prospect of recovery. This is generally the case when the Company determines that the debtor does not have assets or sources of income that could generate sufficient cash flows to repay the amounts subject to the write-off.

The following table summarizes the classification under IFRS 9 for each financial instrument:

Financial instruments	Classification
Cash and cash equivalents	Amortized cost
Other receivables	Amortized cost
Marketable securities	FVTPL
Reclamation bonds	Amortized cost
Amounts payable and other liabilities	Amortized cost
RSU liability	FVTPL

Notes to Financial Statements December 31, 2023 and 2022 (Expressed in Canadian Dollars)

2. Material Accounting Policies (Continued)

Financial Instruments (continued)

Financial instruments recorded at fair value on the statements of financial position are classified using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The fair value hierarchy has the following levels:

•  Level 1 - valuation based on quoted prices (unadjusted) in active markets for identical assets or liabilities;

•  Level 2 - valuation techniques based on inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

•  Level 3 - valuation techniques using inputs for the asset or liability that are not based on observable market data (unobservable inputs).

Marketable securities and RSU liability are classified as Level 1.

Quebec refundable tax credits and mining duties receivable

The Company is entitled to a refundable duties credit for mining losses under the Mining Duties Act. This credit is based the Company's mining and exploration activities incurred in the Province of Quebec.

Additionally, the Company is entitled to a refundable tax credit for mining companies on qualified exploration expenditures incurred that were not funded by flow-through shares. The refundable tax credit rate is different for qualified expenditures incurred in Northern Quebec compared to other regions in Quebec.

These credits are recognized when the Company incurs qualified expenditures and collectability is considered probable. When recognized, these credits are applied against the costs incurred.

Property and Equipment

Property and equipment are carried at cost, less accumulated depreciation and accumulated impairment losses.

The cost of an item of property and equipment consists of the purchase price, any costs directly attributable to bringing the asset to the location and condition necessary for its intended use and an initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located.

Depreciation is recognized based on the cost of an item of property and equipment, less its estimated residual value, over its estimated useful life at the following rates:

Detail	Percentage	Method
Computer equipment	30%	Declining balance
Field equipment	30%	Declining balance
Site building	10%	Declining balance
Building	10%	Declining balance
Artwork	-	-

Artwork is not amortized since it does not have determinable useful life.

At each financial position reporting date the carrying amounts of the Company's assets are reviewed to determine whether there is any indication that those assets are impaired. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment, if any.