BTU Metals : Q3 2022 MD and A

Management's Discussion and Analysis

For the Three and Nine Months Ended January 31, 2021

REPORT DATED: March 31, 2021

Management's Discussion and Analysis

For the Three and Nine Months Ended January 31, 2022 Dated March 31, 2022

The following Management's Discussion and Analysis ("MD&A") is intended to assist the reader to assess material changes in financial condition and results of operations of BTU Metals Corp (TSX-V: BTU) ("BTU" or the "Company") for the three and nine months ended January 31, 2022.

This MD&A should be read in conjunction with the unaudited interim condensed consolidated financial statements for the three and nine months ended January 31, 2022 (the "Q3 2022 Financial Statements").

The Company's management is responsible for the preparation of the Company's consolidated financial statements as well as other information contained in this MD&A. The board of directors of BTU (the "Board of Directors") is required to ensure that management assumes its responsibility in regard to the preparation of the Company's financial statements. To facilitate this process, the Board of Directors has created an audit committee (the "Audit Committee"). The Audit Committee met with members of the management team to discuss the operating results and the financial results of the Company, before making their recommendations and submitting the Q3 2022 Financial Statements and this MD&A to the Board of Directors for review and approval. Following the recommendation of the Audit Committee, the Board of Directors approved the Q3 2022 Financial Statements and this MD&A on March 31, 2022.

The Q3 2022 Financial Statements have been prepared in accordance with International Financial Reporting Standards ("IFRS").

Additional information regarding the Company is available on the Company's websitewww.btumetals.com and on SEDAR atwww.sedar.com under BTU's profile.

FORWARD-LOOKING INFORMATION

This MD&A together with the Company's Q3 2022 Financial Statements contain certain statements that may be deemed "forward-looking statements". Forward-looking statements in this document are statements that are not historical facts and are generally, but not always, identified by the words "expects", "plans", "anticipates", "believes", "continue", "intends", "estimates", "projects", "potential" and similar expressions, or that events or conditions "will", "would", "may", "could" or "should" occur. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management are inherently subject to significant business, economic and competitive uncertainties, and contingencies. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. The Company disclaims any obligation or intention to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.

Inherent in forward-looking statements involve known and unknown risks, and factors may include, but are not limited to: unavailability of financing, changes in government regulation, general economic condition, general business conditions, limited time being devoted to business by directors, escalating professional fees, escalating transaction costs, competition, fluctuation in foreign exchange rates, competition, stock market volatility, unanticipated operating events and liabilities inherent in industry. Readers are cautioned that the foregoing list of important factors and assumptions is not exhaustive. Forward-looking statements are not guarantees of future performance. Events or circumstances could cause the Company's actual results to differ materially from those estimated or projected and expressed in, or implied by, these forward-looking statements. The Company undertakes no obligation to update publicly or otherwise revise any forward-looking statements or the foregoing list of factors, whether as a result of new information or future events or otherwise, except as may be required under applicable laws.

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Management's Discussion and Analysis

For the Three and Nine Months Ended January 31, 2022 Dated March 31, 2022

DESCRIPTION OF BUSINESS

BTU was incorporated under the Business Corporations Act (British Columbia) on August 28, 2008. The Company is classified as a Tier 2 mining issuer listed on the TSX Venture Exchange (the "Exchange"), having the symbol BTU, and also trades on the OTCQB having the ticker symbol BTUMF and is involved in the exploration and development of the various projects it has acquired or holds under option.

On July 5, 2017, the Company announced that it had signed an option agreement to acquire a 100% interest in the 16,640-hectare Galway Gold Project located in County Galway, Republic of Ireland. On May 22, 2018, the Company accelerated the terms of its option agreement and acquired 100% of Gold Note, Ltd., the holder of the Company's Galway project located in Galway, Ireland. The Company paid $150,000 in cash and issued 600,000 common shares of the Company in exchange for 100% ownership of the Galway project through its ownership of Gold Note, Ltd. Furthermore, the property is subject to a 2% net smelter royalty ("NSR"), with the option for the Company to acquire 1.5% of the NSR, resulting in a 0.5% NSR, for $1.5 million at any time. During the year ended April 30, 2021, the Company recorded an impairment loss of $865,283 due to uncertainty on the renewal of the permits.

On August 24, 2018, the Company announced it was acquiring a 100% interest in the claims that comprise the Dixie Halo East property from an arms-length vendor for payments of $85,000 in cash and the issuance of 750,000 shares over a 4-year period. The vendor retains a 1.5% NSR, half of which is purchasable by the Company for $500,000 at any time. The Company made a cash payment of $10,000 and issued 150,000 shares in September 2018, a cash payment of $12,000 and issued 150,000 common shares at a fair value of $15,750 in September 2019, and a cash payment of $16,000 and issued 150,000 common shares at a fair value of $28,500 in September 2020, and a cash payment of $22,000 and issued 150,000 common shares at a fair value of $16,500 in September 2021 according to the terms of the property option agreement.

On September 5, 2018, the Company announced it was acquiring a 100% interest in the claims comprising the Burnthut Project from an arms-length party through the cumulative payment of $85,000 and the issuance of 750,000 shares of the Company over a 4-year period. This transaction closed on October 5, 2018, and the Company made a cash payment of $10,000 and issued 150,000 shares. As of April 30, 2019, the Company determined that it was in the Company's best interest to abandon the Burnthut option agreement and focus its exploration activity on the Dixie Halo group of properties. The Company reduced the carrying value of the Burnthut property Option to $nil as of April 30, 2019. On July 8, 2019, the Company issued 100,000 common shares at a fair value of $15,000 as a termination payment under the option agreement and returned the project to the optionor.

On October 17, 2018, the Company announced that it had entered into an option agreement to acquire a 100% ownership interest in the property known as Dixie Halo South Property from arms-length vendors in exchange for the issuance of 8,000,000 common shares of the Company payable in two tranches, 50% due on closing and 50% due 12 months from the closing date. TSX-V approval was obtained on November 14, 2018. In addition, the option agreement requires the Company to incur $2,000,000 in expenditures on the property with $1,000,000 required to be spent prior to a date that is 12 months from the closing date and the second $1,000,000 to be spent no later than a date that is 24 months from the closing date. In addition, the property is subject to an NSR of 2.5% on all mineral products produced from the property. The Company has the right to repurchase up to 1.0% of the NSR at any time at its discretion for a total cash payment of $2,000,000. The transaction was approved by the TSX-Venture exchange on January 18, 2019. On March 18, 2020, the Company entered into an extension agreement with respect to the Dixie Halo South project, extending by 30 days the requirement to meet a minimum spending commitment on the property of $1,000,000. The Company issued 20,000 common shares to the optionor upon the granting of

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Management's Discussion and Analysis

For the Three and Nine Months Ended January 31, 2022 Dated March 31, 2022

the extension. The extension agreement also included an option to further extend the expenditure obligation for an additional two months, with each additional extension requiring the issuance of 20,000 BTU common shares. The Company exercised an additional one-month extension and issued 20,000 additional shares on May 1, 2020. The Company met the first-year exploration expenditure requirements prior to the end of the extension period. The Company has now met the full exploration expenditure requirements under the original option agreement and the property has been transferred to BTU with BTU now owning 100% of the property.

On October 17, 2018, the Company announced that it had entered into an option agreement to acquire a 100% ownership interest in the property known as Dixie Halo Southeast Property from arms-length vendors in exchange for the issuance of 4,000,000 common shares of the Company payable in two tranches, 50% due on closing and 50% due 12 months from the closing date. TSX-V approval was obtained on November 27, 2018. In addition, the option agreement requires the Company to incur up to $500,000 in expenditures on the property with $250,000 required to be spent prior to a date that is 12 months from the closing date and the second $250,000 to be spent no later than a date that is 24 months from the closing date. As of the date of this MD&A, the Company has met the entire exploration expenditure commitment on the property, having spent in excess of $500,000 on the property. In addition, the property is subject to an NSR of 2.5% on all mineral products produced from the property. The Company has the right to repurchase up to 1.0% of the NSR at any time at its discretion for a total cash payment of $2,000,000. The transaction closed on November 27, 2018, and the Company issued the vendors 2,000,000 common shares on that date and issued the second tranche of 2,000,000 common shares on November 26, 2019. As of the date of this MD&A the Company has met its full expenditure obligations under the Agreement.

On November 23, 2018, the Company announced that it was acquiring 100% of the shares of Burgundy Exploration Corp. (The Dixie Halo Southwest Extension Property), from arms-length vendors, in exchange for 3,600,000 common shares (1,800,000 common shares which are to be issued on TSX-V approval and 1,800,000 common shares to be issued on the first anniversary of TSX-V approval) to the vendors of Burgundy Exploration Corp. TSX-V approval was obtained on December 7, 2018. A pre-existing 2% GSR is applicable on the tenure being acquired. There are no cash payments nor are there any mandated work expenditures outside of normal government assessment reporting obligations. The transaction has been completed and the claims are now registered in the name of the Company.

On October 28, 2019, the Company announced that it was acquiring 94 claims (1,913 hectares) adjoining the eastern and southern boundaries of BTU's existing Dixie Halo project in Red Lake from an arms-length vendor in exchange for 1,800,000 common shares. TSX-V approval was obtained on November 6, 2019. The Company was required to incur $38,000 in expenditures on the property within 6 months (incurred as at the date of this MD&A) and the vendors were granted a 2% Gross Smelter Royalty ("GSR") on non-base metals. The Vendors were also granted a 2% GSR on base metals, 1% of which may be purchased by the Company within the first 7 years of closing for the payment of $1,000,000. The terms of the option have been completed and the claims are now registered in the name of the Company.

On November 29, 2019, the Company announced that it expanded its Dixie Halo property position by 238 claims covering 4,853 hectares. The new claims are royalty free and not subject to any agreement.

On March 23, 2021, the Company announced that it expanded its property position in the Red Lake area through entering into an agreement that allows the Company to earn up to an 80% interest in the 3,000-hectare Pakwash North property that is located adjacent to the east and southeast boundaries of the Company's Dixie Halo project.

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Management's Discussion and Analysis

For the Three and Nine Months Ended January 31, 2022 Dated March 31, 2022

About the Galway Gold Project

The Galway Gold Property is located 45km north of the city of Galway and has excellent access (paved roads) and infrastructure (electricity, water, and a sufficiently large population centre nearby). The property has undergone substantial geological work historically and surface samples from the property returned gold grades of up to 66g/t gold in outcrop, up to 6.5 oz/t gold in float, as well as up to 2.2g/t, 5.06 g/t, and 6.3 g/t gold in surface samples. Three large anomalous areas over a 13.2 km long trend have been identified and believed to be related to the regional Maum Shear zone.

The Galway Property has been targeted for orogenic and low-sulphidation gold mineralization and is located 145 km southwest of Dalradian Resources Inc.'s high-grade Curraghinalt Gold Deposit. The Company has completed the work required under PLs 3145 and 1341 for license extension and awaits permitting approvals to continue exploration work on PL 2295.

The Company acquired control of 100% of the Galway project on May 22, 2018.

Doug Hunter, P.Geo, is the qualified person as defined by National Instrument 43-101 who has examined and described the mineral occurrences within the Company's Irish prospecting licenses and is responsible for reviewing and approving the technical contents contained in this MD&A on the Galway property.

Update on Exploration Activities on the Galway Project

In March 2019, as part of its annual renewal process for the Galway Prospecting Licenses, the Company relinquished its rights to Prospecting Licenses 2301, 2647, and 3227 to focus its exploration activity on Prospecting Licenses 1431, 2295 and 3145.

The Company awaits permit renewals, including on PL 2195, the Lee Valley prospect, where samples of 49 g/t gold have been extracted from an exposed vein and multiple veins are interpreted based on the available governmental magnetic survey. The permit renewals are required in order for the Company to continue with its planned exploration activities of the Galway project. During the period of time that the Government is reviewing the permit renewals, the Company has been given an extension of time to complete the required expenditures on the project. Once the license renewal deliberations have been completed, the Company will evaluate the next steps for this project. As of April 30, 2021, pending the renewal of the license, the Company wrote down the carrying value of the Galway Project to $1.00, and recorded an impairment loss of $865,283 during the year ended April 30, 2021, due to the uncertainty surrounding the renewal of the exploration and drilling permits.

Pakwash North Acquisition

On March 22, 2021, the Company announced that it has entered into an agreement with GoldON Resources Ltd. that allows it to earn up to an 80% interest in the 3,000-hectare ("ha") Pakwash North property located adjacent to the east and southeast boundaries of its Dixie Halo project (Figure 1). Cumulative terms of the option to earn an 80% interest in the Pakwash North property (formerly called the "Bruce Lake property") from GoldON Resources Ltd. call for cash payments of $75,000, the issuance of 1,400,000 shares and for the Company to incur expenditures of $1,000,000 over 36-months. The Company, at its discretion, may elect to stay at certain, fixed percentages over the course of the option at which time a definitive joint venture agreement will be entered into by the companies.

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