Taranis Resources : Management Discussion and Analysis (Audited Year end 2021)

TARANIS RESOURCES INC. MANAGEMENT DISCUSSION & ANALYSIS, FOR THE YEAR ENDED DECEMBER 31, 2021 (Including subsequent events to April 21, 2022)

This Management Discussion and Analysis ("MD&A) is provided for the purpose of reviewing the performance of Taranis Resources Inc. ("Taranis" or "the Company") for the year ended December 31, 2021 and comparing results with the previous year. It should be read in conjunction with the Company's audited consolidated financial statements and corresponding notes for the year ended December 31, 2021, which were prepared in accordance with International Financial reporting Standards ("IFRS")

The Company's management is responsible for the preparation and integrity of the financial statements, including the maintenance of appropriate systems, procedures and internal controls and to ensure that information used internally or disclosed externally, including the financial statements and MD&A, is complete and reliable. The Company's board of directors follows recommended corporate governance guidelines for public companies to ensure transparency and accountability to shareholders.

In March 2020 the World Health Organization declared coronavirus COVID-19 a global pandemic. This contagious disease outbreak, which has continued to spread, and any related adverse public health developments, have adversely affected workforces, economies, and financial markets globally, potentially leading to an economic downturn. It is not possible for the Company to predict the duration or magnitude of the adverse results of the outbreak and its effects on the Company's business or ability to raise funds.

The reader is encouraged to review the Company's statutory filings onwww.sedar.com and general information on its websitewww.taranisresources.com.

FORWARD LOOKING STATEMENTS

All statements in this report that do not directly and exclusively relate to historical facts constitute forward-looking statements. These statements represent the Company's intentions, plans, expectations and beliefs and are subject to risks, uncertainties and other factors of which many are beyond its control. These factors could cause actual results to differ materially from such forward-looking statements. The Company disclaims any intention or obligation to update or revise any forward-looking statements, as a result of new information, future events or otherwise.

OVERALL PERFORMANCE

As of April 21, 2022 Taranis has sufficient funds to meet its fixed overhead commitments to the end of December 2022. See "Capital Resources and Liquidity" and "Financial Instruments and Capital Risk Management" for more information.

DESCRIPTION OF BUSINESS

The Company is principally engaged in the acquisition, exploration and, if results warrant, development of precious and base metal projects. It is currently actively exploring and developing one advanced-stage precious/base metal prospect in British Columbia, Canada.

All of the Company's exploration activities are overseen by John Gardiner (P. Geol.), a Qualified Person under the meaning of Canadian National Instrument 43-101.

RESULTS OF OPERATIONS

The cumulative costs of Exploration and Evaluation Assets for the years ended December 31, 2021 and December 31, 2020 are as follows:

EXPLORATION AND EVALUATION ASSETS

December 31, 2021

December 31, 2020

Thor Property

Acquisition costs: Balance, beginning of year

$

780,784 $ 727,412

Additions

6,407 53,242

Balance, end of year

787,191

780,784

Exploration costs: Balance, beginning of year

• 4,767,770 4,421,146

  Assaying and metallurgy

• 17,959 11,982

• Geological fees 67,131 140,348

• Engineering and permitting 33,272 65,805

  • Drilling 251,723 128,489

  • 370,085 346,624

Balance, end of year

5,137,855

4,767,770

Total costs

$ 5,925,046 $ 5,548,554

Other Projects/Evaluations

Periodically the Company evaluates other exploration opportunities that have either been directly identified by it or have been brought to its attention. These projects fall under the heading of Property Evaluation and typically include the cost of data evaluation and site visits. These costs are capitalized if the property is acquired; otherwise they are written off.

Thor Property, British Columbia, Canada

The Company's Thor property, which is in the Revelstoke Mining District of British Columbia and includes 27 Crown Granted Mineral Claims and 14 Mineral Tenures covering approximately 3,314 hectares, forms a contiguous 100% owned property over the Thor precious and base metal deposit.

The Thor deposit occurs within a major geological structure called the Silver Cup Anticline where it is transected by a north-northwest trending fault zone (Thor Fault Zone). The Silver Cup Anticline hosts almost all of the known precious-base metal deposits in the Silver Cup mining District. The Silver Cup mining district saw extensive mining development in the early 1900's and had a number of former producing mines operating including the Spider, Silver Cup, Triune and Nettie L. Mines.

General Geology of the Thor Project

Silver, gold, copper, lead and zinc lodes are associated with the Thor Fault Zone ("TFZ"), a major geological structure that extends for upwards of 4 km on the property in a north-northwest direction. The TFZ dips moderately to the ENE and consists of individual segments that commonly overlap in an en-echelon fashion. The TFZ obliquely crosscuts the older northwest trending Silver Cup Anticline.

The TFZ contains all of the known precious/base metal zones on the property. These include, from south-southeast to north-northwest, the Broadview, Great Northern, True Fissure, SIF, Blue Bell and the Thunder Zone. The recently discovered Thunder Zone is the only known mineral occurrence on the northeast side of the Silver Cup Anticline and occurs northeast of the Blue Bell Zone.

Taranis has conducted substantial drilling within the TFZ. In addition, the Company has also conducted surface exploration on the Intrusive Target that lies under Broadview Creek that is potentially the source of the precious and base metal mineralization at Thor.

Stratigraphy

There are three important rock types found on the property and these are described briefly below.

• • Sharon Creek Formation - The oldest rocks found on the property are carbonaceous shales that are generally black in colour, and are prone to rapid weathering. Rocks of this formation are commonly found in recessively weathered areas and valleys. Fissure Creek is localized along the axis of the Silver Cup Anticline that exposes the Sharon Creek Formation. These rocks are generally devoid of mineralization, but they can include extensive pyritization in areas.

• • Broadview Formation - Directly overlying the Sharon Creek Formation are resistive weathering greywacke/clastic rocks of the Broadview Formation. These rocks are typically massive, siliceous and are commonly found on hilltops and higher areas of elevation. The Broadview Formation is also referred to as the lithocap by geologists owing to its impermeable nature to mineralization.

• • Jowett Formation (Volcanic and Intrusive Rocks) - In a regional setting, the Sharon Creek Formation and the younger Broadview Formation are separated by the Jowett Formation. The Jowett Formation largely consists of volcanic rocks (agglomerates, breccias, pyroclastic rocks and mafic volcanic flows) with minor sediments (argillite and limestone). Although the Jowett Formation has not been formally identified at Thor, its presence is strongly inferred from a complex series of rocks that are commonly referred to as "Green Tuff" in the mine site geology. Its presence is also indicated from magnetic modeling that has indicated the presence of a large 'intrusive' feature at depth below the

  Thor epithermal deposit,

Model of Mineralization at Thor - The Epithermal/Porphyry Model

The model that is used to describe the existing Thor deposit is an intermediate-sulfide epithermal model. The model is useful because it accounts for many of the features found in the deposit including vuggy, gold bearing deposits (SIF) at the top and periphery of the deposit that have extensive jarosite alteration, and a general progression to increased base metal content at depth along the deposit. The Thor deposit exhibits many geological similarities to the Lepanto deposit located in the Philippines, which is now considered a linked porphyry-epithermal deposit. This exploration model, now extensively used at Thor, led to the discovery of the Thunder Zone, and it importantly suggests the presence of an underlying porphyry deposit that is the origin of the epithermal deposits. An abundance of information exists to suggest the presence of a mineralized porphyry body at Thor concealed below the surface, and is the focus of much of the current exploration activity.

Based on the linked porphyry-epithermal deposit model, the Source of the mineralization at Thor is most likely a large intrusive body found under Broadview Creek, the Conduit is the Thor Fault Zone which obliquely crosscuts the Silver Cup Anticline, and finally the Trap is a lithology called the Jowett Formation lying under the Broadview Formation that is a tight caprock. While the Source part of this model remains to be tested with drilling for porphyry-type mineralization, it was the subject of further exploration activity in 2021 including ground geophysical surveys, and surface sampling. The Company is planning on undertaking a comprehensive airborne survey that will utilize magnetic and AFMAG-EM surveys to map the feature in much greater detail, and to depths up to 1 km.

The age of mineralization at Thor postdates the folding event that created the northwest-trending Silver Cup Anticline. Silver/gold and base metals are preferentially emplaced along the TFZ and strike north-northwest and dip moderately to the ENE (450). Slickensides indicate that there has been significant sinistral strike-slip movement along the TFZ, but it is also suspected that the fault had an earlier normal episode where the east-northeast side has been down-dropped.

Stratigraphic Control of the Thor deposit

Within the plane of the TFZ, mineralization is preferentially emplaced along the Sharon Creek/Broadview Formation contact that abuts the TFZ. Mineralizing fluids have ascended along the TFZ, and where they intersected the receptive Jowett Formation, it forms extensive and wide zones of mineralization. The Jowett and Broadview Formations are referred to as lithocap rocks because the mineralized epithermal zones are generally found in close proximity to these two geological formations.

There has been minimal exploration completed on the northeast side of the Silver Cup Anticline but drilling in 2021 discovered the Thunder Zone that demonstrates mineralization continues in this area under Thor's Ridge. In longitudinal cross-section, the morphology of the lodes show they plunge at a shallow angle to the north-northwest and are controlled by faulting within the TFZ.

Taranis has developed a structural model that clearly shows mineralized zones at Thor occur within a series of tension gashes that have formed within the TFZ that exhibit sinistral deformation. This model is predictive and shows a series of staircasing, or en-echelon zones that migrate 60-100 meters to the east-northeast on the end of the individual zones. This structural model, in conjunction with identifying it as an epithermal-type deposit, was key to the discovery of the Thunder Zone.

Main Areas of Exploration at Thor (Epithermal and Intrusive)

Epithermal Zones

Throughout the 4Q of 2021, the Company focused considerable attention on compiling the 2021 exploration results with prior exploration data, using the linked porphyry epithermal deposit model. One of the biggest achievements was a geological map of the Thor property that combines all of the historic data. These epithermal zones contribute to a strike length of over 2.0 km of continuous mineralization along the surface. Total strike length of epithermal mineralization at surface with the new targets could be upwards of 3.3 km.

The new geological approach has already led to the discovery of a seventh epithermal zone at Thor in 2022; the Thunder Zone. Three previously unexplored areas which are likely to host significant epithermal zones at Thor bring the total possible number of discrete epithermal bodies at Thor to ten or more. The new targets are expected to host large areas of epithermal mineralization related to a central buried intrusive feature that is the focus of a separate exploration effort. These targets are discussed in detail below:

SIF-North (Including Thunder Zone)

The 2021 discovery of the Thunder Zone on the south side of Thor's Ridge opens the possibility of substantially increasing the length of the Thor deposit to the northwest. Both the Thunder Zone and a previously known but isolated gold occurrence called SIF-North sit on the northeast limb the Silver Cup Anticline, within the cross-cutting Thor Fault Zone. The northeast limb of the Silver Cup Anticline preserves older rocks of the Sharon Creek Formation (carbonaceous phyllite), and younger lithocap rocks of the Jowett and Broadview Formation (volcanics and greywacke). The contact between these rock units hosts all other known epithermal mineralization at Thor. Previous