Amaroq Minerals : Management’s Discussion and Analysis For the Three months ended March 31, 2024

Amaroq Minerals Ltd.

MANAGEMENT'S DISCUSSION AND ANALYSIS

QUARTERLY HIGHLIGHTS

Three months ended March 31, 2024

Amaroq Minerals Ltd.

Management Discussion & Analysis

For the three months ended March 31, 2024

1.	Nature of activities	3
2.	Corporate update	4
3.	Property acquisition	8
4.	Exploration and evaluation expenses	9
5.	Strategy and action plan	22
6.	Environmental monitoring expenses	23
7.	Selected annual information	23
8.	Results of operations	23
9.	Selected quarterly information	26
10.	Liquidity and capital resources	27
11.	Off balance sheet arrangements	27
12.	Subsequent event	27
13.	Transactions between related parties	27
14.	Critical accounting policies, estimates, judgements and assumptions	28
15.	Changes in accounting policies	28
16.	Financial instruments	28
17.	Contractual commitments and obligations	28
18.	Outstanding shares data	29
19.	Stock option plan and Restricted Share Unit plan	29
20.	Risk factors	29
21.	Disclosure Controls and Procedures	36
22.	Internal Control over Financial Reporting	36
23.	Forward looking information	36

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Amaroq Minerals Ltd.

Management Discussion & Analysis

For the three months ended March 31, 2024

This Management's Discussion and Analysis ("MD&A") of Amaroq Minerals Ltd. (the "Corporation"), and its subsidiary companies and joint arrangements provide a detailed analysis of the Corporation's business and compare its financial results with those of the previous periods. This MD&A is dated as of May 14, 2024 and should be read in conjunction with the Corporation's unaudited condensed interim consolidated financial statements and related notes for three-months ended March 31, 2024 (the "Financial Statements"), as well as with the MD&A and audited financial statements for the year ended December 31, 2023. The unaudited condensed interim consolidated financial statements for the three months ended March 31, 2024 are prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB"). All dollar amounts in this MD&A are expressed in Canadian dollars, unless otherwise noted.

Further information regarding the Corporation, including the Corporation's press release, quarterly and annual reports, Annual Information Form are available electronically on the System for Electronic Data Analysis and Retrieval + (SEDAR+) in Canada and can be found on www.sedarplus.ca. The following abbreviations are used to describe the periods under review throughout this MD&A:

Abbreviation	Period
Q4-22	October 1, 2022 to December 31, 2022
2022	January 1, 2022 to December 31, 2022
Q1-23	January 1, 2023 to March 31, 2023
Q2-23	April 1, 2023 to June 30, 2023
Q3-23	July 1, 2023 to September 30, 2023
Q4-23	October 1, 2023 to December 31, 2023
2023	January 1, 2023 to December 31, 2023
Q3-23	July 1, 2023 to September 30, 2023
Q4-23	October 1, 2023 to December 31, 2023

1. NATURE OF ACTIVITIES

Amaroq was incorporated on February 22, 2017 under the Canada Business Corporations Act. The Corporation's registered office is situated at 3400, One First Canadian Place, P.O. Box 130, Toronto, Ontario, M5X 1A4, Canada. The Corporation operates in one industry segment, being the acquisition, exploration and development of mineral properties and it owns interests in properties located in Greenland. The Corporation's shares are listed (under the AMRQ ticker) on the TSX Venture Exchange (the "TSX- V") since July 2017; also, on the AIM market of the London Stock Exchange ("AIM") since July 2020 and from November 1, 2022, on Nasdaq First North Growth Market Iceland which were transferred to the Nasdaq Main Market Iceland ("Nasdaq") on September 21, 2023.

Amaroq is in the process of restarting its cornerstone Nalunaq mine and concurrently the construction of an on-site processing plant to produce and sell gold dore as a means to become self- funded in order to unlock the true mineral potential of its large licence holdings in Greenland and deliver significant value to all stakeholders. The Corporation is actively exploring for, what we believe to be world class gold deposits in Vagar and Nanoq, and through the joint venture with GCAM (the "Joint Venture" or "JV"), has expanded its focus to exploring for strategic minerals in Sava, Stendalen, Paatusoq and Kobberminebugt to potentially fill the growing supply gap.

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Amaroq Minerals Ltd.

Management Discussion & Analysis

For the three months ended March 31, 2024

2. OPERATIONAL PERFORMANCE HIGHLIGHTS

For the three-months ended March 2024 the Corporation's main focus continued to be the finishing of the Nalunaq Underground Mine rehabilitation and to start underground development in Mountain Block with the first stope blast on March 30, 2024 at the 720 level whilst concurrently constructing a 300 tonne per day process plant and associated infrastructure that will produce gold dore on site. During the quarter and ahead of the first blast, the new explosives storage facility was fully permitted, commissioned and handed over to the mining team for operations. The Nalunaq project team also completed the expansion and winterization of the camp during February 2024.

The Corporation has also been conducting detailed planning of the 2024 exploration activities both across the gold and strategic metal portfolio. In preparation for the strategic mineral programs, the geological teams have been conducting further review and interpretations from the 2023 exploration results assisted by a number of external experts. Specifically, geophysical data from Sava, Stendalen, Kobberminebugt and Nunrasuit project has been assessed to refine geological targets for 2024.

2.1 Q1-24 Consolidated Financial Results

Period ended March 31, 2024	Three	Three
	months	months
	2024	2023
Financial Results		$
Exploration and evaluation expenses	875,213	1,181,653
General and administrative expenses	3,959,226	2,577,035
Loss on disposal of capital assets	-	37,791
Foreign exchange loss (gain)	79,509	(197,004)
Interest income	(15,326)	(231,319)
Gardaq management income and allocated cost	(636,326)	-
Share of net losses of joint arrangement	646,432	-
Unrealized loss on derivative liability	4,300,213	-
Finance costs	8,574	8,737
Net loss and comprehensive loss	(9,217,515)	(3,376,893)
Net loss per share, diluted	(0.03)	(0.01)
Financial Position
Cash	65,086,851	46,784,407
Investment in equity-accounted joint arrangement	22,846,379	-
Total assets	179,887,713	62,010,593
Total current liabilities	48,922,487	1,091,187
Shareholders' equity	130,283,503	60,280,742
Working capital (before convertible notes liability)1	78,210,475	46,738,567
Working capital (convertible notes liability included)	36,659,134	46,738,567

1 Working Capital as per the Consolidated Statement of Financial Position as at March 31 2024 is $36,659,134 and includes

$41,551,341 of Convertible Notes liability- hybrid instrument with complex embedded derivatives due to its early conversion and repayment feature components. According to the Corporation's Financial Instruments accounting policy (Note 6 of the Financial Statements), host liability and embedded derivative liability are to be classified as current due to its early conversion feature (Note 6.2 of the Financial Statements).

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Amaroq Minerals Ltd.

Management Discussion & Analysis

For the three months ended March 31, 2024

2.2 2024 Financial Performance Highlights

	Q1-24	Q4-23	Q3-23	Q2-23
Exploration and evaluation		$	$	$
expenses	875,213	879,266	2,277,540	2,278,193
Site development costs	-	690,179	-	1,825,564
General and administrative
expenses	3,959,226	5,616,655	2,632,041	2,806,181
(Gain) on loss of control of
subsidiary	-	-	-	(31,340,880)
Share of net losses of joint
arrangement	646,432	2,871,156	3,381,749	1,639,482
Net (loss)/income	(9,217,515)	(14,259,099)	(6,555,222)	23,357,701
Net (loss)/income per share,
diluted	(0.03)	(0.05)	(0.02)	0.09
Cash	65,086,851	21,014,633	53,655,954	39,669,852
Investment in equity-
accounted joint arrangement	22,846,379	23,492,811	26,363,967	29,745,716
Total assets	179,887,71	106,953,183	111,193,232	87,686,844
Total current liabilities	48,922,487	42,097,312	32,613,568	2,980,657
Shareholders' equity	130,283,503	64,278,637	77,982,519	84,089,457
Working capital (before
convertible notes liability)2	78,210,475	37,614,068	58,690,733	41,017,725
Working Capital (convertible
notes liability included)	36,659,134	1,870,941	28,895,835	41,017,725,

	Q1-23	Q4-22	Q3-22	Q2-22
Exploration and evaluation	$	$	$	$
expenses	1,181,653	1,697,334	5,567,361	4,425,501
Site development costs	-	-	-	-
General and administrative
expenses	2,577,035	3,203,588	1,859,725	2,097,937
(Gain) on loss of control of
subsidiary	-	-	-	-
Share of loss of joint
arrangement	-	-	-	-
Net (loss)	(3,376,893)	(4,426,345)	(7,012,481)	(6,324,639)
Net (loss) per share, diluted	(0.01)	(0.02)	(0.04)	(0.04)
Cash on hand	46,784,407	50,137,569	11,032,487	19,494,000
Investment in equity-accounted
joint arrangement	-	-	-	-
Total assets	62,010,593	65,096,061	26,028,307	34,618,121
Total current liabilities	1,091,187	1,210,758	1,227,741	2,880,555
Shareholders' equity	60,280,742	63,227,863	24,124,912	31,043,925
Working Capital	46,738,567	49,472,991	10,065,234	16,782,108

The Corporation reported a net loss of $9,217,515 in Q1-24 compared to net loss of $3,376,893 for Q1-23. The main variations are as follow:

• Exploration and evaluation expenses of $875,213 ($1,181,653 in Q1-23), mainly representing the costs associated with continual review work upon a number of the Company's targets and the preparation for the 2024 field programmes. These have included:
• • 
    o Detailed exploration design for 2024/2025 programmes across Nalunaq, Vagar, Nanoq gold targets
  • General and administrative costs of $3,959,227 ($ ($2,577,035 in Q1-23).
    o Salaries and benefits of $869,415 ($617,589 in Q1-23). Salaries and benefits are expected to
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Amaroq Minerals Ltd.

Management Discussion & Analysis

For the three months ended March 31, 2024

increase over the next couple of quarters as manpower is increased to complete the construction of the processing plant, manage on-site stores and warehousing, coordinate site rotations and logistics and collection of ESG related data. This cost is also expected to increase as Nalunaq transitions from construction to commissioning and operations.

1. Stock-basedcompensation of $712,306 ($451,014 in Q1-2023). The Corporation has implemented a Restricted Share Unit Plan ("RSU") to incentivize delivery of the exceptional shareholder returns over the longer-term and to align the interests of Senior Executives with those of shareholders. Under the RSU, participants share in a ''RSU pool'' of up to 10% in excess of the growth in the Corporation's value. The Corporation's value for purposes of the ''RSU pool'' is determined using a hurdle rate of 10% pa over a performance period commencing on January 1, 2022. Part of the RSU pool will be reserved for future participants. Growth in value is based on the change in share price, with an adjustment for any dividends paid during the period (to the extent such distributions are made), based on the same number of shares in issue at the start of the performance period. Awards were granted to participants on December 31, 2022 and October 13, 2023. $711,500 recorded in three months ended March 31, 2023 represents the recognition of the three-month expense based on the fair valuation of the RSU pool for current participants which increased from four to five members of the Executive team, as well as RSU plan amendment that increased the number of shares available for the conditional award to be 10% of the issued share capital at the time of the award instead of 10% of a fixed share capital amount of 177,098,740. Further details on the RSU description and valuation are provided under Note 8.2 of March 31, 2024 Financial Statements.

1. Professional fees of $939,809 ($611,878 in Q1-23). Increase in professional fees is mainly due to additional advisory costs related to the measurement and valuation of complex financial instruments and associated disclosures.

1. Investor Relations and Communication of $166,037($141,968 in Q1-23) is slightly higher than for the same period of 2023 mainly driven by increased interaction with investors due to equity raise in February 2024.

1. Insurance of $78,916 ($67,602 in Q1-2023). The increase is mainly driven by slightly higher market rates for general liability insurance and increase in coverage given the progress in construction at Nalunaq.

• 1. Regulatory fees of $393,733 ($212,939 in 2022). The increase in costs reflect the third listing by the Corporation together with the subsequent upgrade from the Nasdaq First North Growth (Iceland) listing to the Main Market an includes the associated increase in market making fees.
• Foreign exchange loss of $79,509 (gain of $197,004 in Q1-2023) represents the revaluation of USD and EUR liabilities against a weakening Canadian dollar. In the 3-month of 2024 USD strengthened from 1.32 to 1.35 against the Canadian Dollar and the EUR strengthened from 1.4481 to 1.4701. The gain of $197,004 for the same period of 2023 was mainly explained by the effects of exchange rate changes on USD and GBP cash which have depreciated against CAD, as well as higher GBP underlying cash balance post November 2022 capital raise.
• Share of net loss in joint arrangement of $646,432 in three months ended March 31, 2024 (zero in three months ended March 31, 2023 since the JV was only established in Q3 2023) representing the 51% share of exploration costs incurred by Gardaq A/S within the period from January 1, 2024 to March 31, 2024.
• Gardaq management income and allocated cost of $636,326 in three months ended March 31, 2024 (zero in three months of March 31, 2023) representing corporate overhead costs charged by Nalunaq A/S to Gardaq A/S within the period from January 1, 2024 to March 31, 2024.

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Amaroq Minerals Ltd.

Management Discussion & Analysis

For the three months ended March 31, 2024

2.4 Cash Flow and Liquidity

Cash used in operating activities in the three months ended March 31, 2024, totalled $4,305,037 compared to $3,523,271 in three months ended March 31, 2023. Cash used in Q1-24 operations reflects the increased activity on the Nalunaq Project as well as the increase in associated general and administrative costs as discussed under section 2.2. Cash used in operations in Q1-2023 was mostly directed at preparing for 2023 exploration season as well as camp maintenance and corporate overheads.

Cash used in investing activities in the three months ended March 31 2024, was $26,548,970 (Q1-2023: $Nil) representing exclusively cash spent on closing out rehabilitation activities in the Nalunaq mine ahead of underground development in Mountain Block and advancing the construction of the 300 tonne per day processing plant, finishing the 88-man camp expansion and winterization, as well as associated surface infrastructure such as the explosives magazine. During Q1-24, and associated with the receipt of the explosive permit, plant construction permit and the bulk mining permit, the Corporation had to update the environmental rehabilitation liability and subsequently increase the amount held in escrow by the MLSA from $0.6 million to $5.7 million.

Cash received from financing activities in the three months ended March 31, 2024, was $74,509,357, compared to cash used in financing activities of $26,474, during the three months ended March 31, 2023. Cash inflow in Q1-24 is mainly driven by the capital raise of GBP 44 million or $78.4 million of gross proceeds which closed on Feb 12, 2024. As at March 31, 2024, aside from $64.4 million available cash, the Corporation had undrawn revolving credit facilities of $38.5 million, representing total liquidity of $103.6 million.

As at March 31, 2024, the Corporation has working capital (before convertible note liability) of $78,210,475 compared to $37,614,068 as of December 31, 2023.

3. CORPORATE UPDATE

3.1 GBP 44 million Fundraising

On February 13, 2024, the Company announced the successful completion of its oversubscribed fundraising which resulted in a total of 62,724,758 new common shares conditionally placed with new and existing institutional investors at a placing price of 74 pence (CAD $1.25, ISK 127 at the closing exchange rate on 9 February 2024). The placing price represented a 5.7% premium to the closing share price on 9 February

2024 on the AIM exchange. The fundraising consisted of:

• A placing of new common shares with new and existing institutional investors at the placing price (the "UK Placing"). Stifel Nicolaus Europe Limited acted as the sole bookrunner and broker on the UK Placing.
• A placing of new depository receipts representing new common shares with new and existing investors at the placing price (the "Icelandic Placing"). Landsbankinn hf. and Fossar Investment Bank hf. acted as joint bookrunners on the Icelandic Placing and Landsbankinn hf. acted as underwriter.
• A private placement of new common shares by certain existing institutional investors and a director of the Company at the placing price (the "Canadian Subscription"). Amaroq director, Sigurbjorn Thorkelsson, participated in the Canadian Subscription for an aggregate of 2,700,000 common shares for gross proceeds of £2.0 million (equivalent to approx. C$3.4 million or ISK 343 million) via Klettar LP (in which he is a sole beneficiary).

As a result of the subscription, net proceeds of approximately GBP 44 million (CAD 75 million) have been raised, exceeding the initial targeted amount of GBP 30 million. The issued shares were credited as fully paid and rank pari passu in all respects with the existing common shares of the Company. Following the admission of the subscribed shares, Amaroq's total issued share capital consists of 326,455,446 common shares.

The proceeds of the fund will be used to further advance exploration at the Company's Vagar and Nanoq licenses and to fund an additional capital injection into its Gardaq joint venture, as well as to accelerate mining and development of the Company's Nalunaq gold project. The Fundraising closed on February 23, 2024.

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Amaroq Minerals Ltd.

Management Discussion & Analysis

For the three months ended March 31, 2024

3.2 Directorate Change

The Corporation's Chief Financial Officer and Director Jaco Crouse will be stepping down from his position as CFO and Director effective June 3rd. The Corporation has initiated a process to appoint a new Chief Financial Officer and will update the market in due course.

3.3 Sustainability Report

The Company will issue its inaugural Sustainability Report for 2023 in Q2-24.

4. OPERATIONAL UPDATES

1. Nalunaq Project Development

1. Engineering: Process plant detailed design and engineering was 86% complete at the end of Q1- 24 based on the updated project scope.
2. Contracting and Procurement: At the end of Q1-24, 81% of the key contracts for the processing plant were concluded and procurement was 81% complete. The last major contract for structural, mechanical, piping and processing plant equipment installation was awarded to Scott Steel Erectors in early April.
3. Construction: Processing plant pad construction is 95% complete, Precast foundations received and on site, foundation excavations completed, all plinths installed up to crusher area. Erection of processing plant steel structure is in progress. Overall processing plant construction is 24% complete.
   .
4. Mine Rehabilitation and Development: Mine rehabilitation was completed in mid-March, followed by the first development blast on March 30th in the 720L sump access. Development work continues in 720L sump access and 724 - 732L Mountain Block incline accessing the first ore sublevel. The staging in front of the ore pass on 300L was dismantled to allow access to the ore pass, with ongoing work to be completed by the end of May. Rehabilitation of 570L access has started to establish underground diamond drill location for drilling-off the Target Block extension. Main fans have been installed at 690L Mountain Block and 580L Target Block. Surface powder magazine has been commissioned and is in use. Mine equipment, including the second development drill and two ST-7 scoops, are on route to Greenland and awaiting delivery to site as per schedule. MineArc refuge stations installed on 580 Target Block and at the 710 Mountain Block. Leaky feeder communication system to be installed in the coming weeks.

1. Gold Exploration Projects
2. • Nalunaq

1. Additional 75 vein intersections from historical core drilling have been selected using core

photography and will be assessed and sampled during Q2 2024.

• 1. Resource development exploration programme have been assessed and designed to work alongside continued underground rehabilitation and development activities.
• Nanoq
• 1. Further desked based modelling from the ALS Goldspot interpretation has allowed the Company to produce detailed resource drilling plans that can be actioned on in 2024/25
• Vagar Ridge
• 1. The Corporation has progressed with the construction of a robust geological and mineralization model to inform future exploration at Vagar as well as designing future exploration options.
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Amaroq Minerals Ltd.

Management Discussion & Analysis

For the three months ended March 31, 2024

4.3 Strategic Minerals Projects (Amaroq 51%)

• Sava Copper Belt (Sava/North Sava)

• 1. Amaroq has continue to assess the results from the 2023 field season alongside recognised subject matter experts in porphyry mineralisation s they develop their 2024 exploration programmes.
• Stendalen
• 1. Geophysical data points to the likely feeder zone and other sulphide accumulation areas.
  1. Drilling data and 3rd party advice have been incorporated into further geophysical inversions of the data collected in 2023 as the Company develops is detailed 2024 exploration field programmes.
• Kobberminebugt:
• 1. High resolution geophysical data (MT) has been received and inverted for the Kobberminebugt licence and is currently being reviewed ahead of the development of a 2024 field programme.
• Nunarsuit
• 1. High resolution geophysical data (Magnetics, Gravity and Radiometrics) has been received for the western sections of the licence and is currently being reviewed ahead of the development of a 2024 field programme.
• Regional Exploration
• 1. The Company has continued its desk based regional exploration programmes developing further targets to be assessed as part of the 2024 field programmes.

5. PROPERTY ACQUISITION

No further property acquisitions have occurred during the reporting period.

6. EXPLORATION AND EVALUATION EXPENSES

Exploration and evaluation expenses are included in the operating loss in the consolidated statement of comprehensive gain.

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Amaroq Minerals Ltd.

Management Discussion & Analysis

For the three months ended March 31, 2024

The Corporation incurred the following exploration and evaluation expenses:

	Q1-24	Q1-23
	$	$
Nalunaq - Au
Geology	13,997	68,192
Lodging and on-site support	184,469	-
Drilling	-	-
Analysis	5,033	-
Transport	-	169,200
Helicopter charter	-	53,301
Logistic support	-	-
Insurance	-	-
Maintenance infrastructure	480,754	293,925
Supplies and equipment	31,722	168,335
Project engineering	-	55,792
Government fees	1,976	-
Depreciation	157,262	164,011
Sava - Strategic Minerals	875,213	972,756
Geology	-	44,193
Transport	-	135,000
Helicopter charter	-	26,566
Maintenance infrastructure	-	195
Supplies and equipment	-	2,223
	-	208,897
Total
Geology	13,997	113,105
Lodging and on-site support	184,469
Underground works	-	-
Drilling	-	-
Analysis	5,033	-
Transport	-	304,200
Helicopter charter	-	79,867
Logistic support	-	-
Insurance		-
Maintenance infrastructure	480,754	294,120
Supplies and equipment	31,722	170,558
Project Engineering costs	-	55,792
Government fees	1,976	-
Depreciation	157,262	164,011
Total exploration and evaluation expenses	875,213	1,181,653

James Gilbertson CGeol, Vice President - Exploration of the Corporation and a Chartered Geologist with the Geological Society of London and as such a qualified person as defined in NI 43-101, supervised the preparation of the technical information in this report.

7. 2024 OUTLOOK

• Permitting: The public consultation for the Environmental Impact Assessment (EIA) and Social Impact Assessment (SIA) for Nalunaq closed on the 1st of March 2024. The Corporation is following the process agreed with the Government of Greenland to respond to the small number of comments received.
• Engineering: Engineering for the processing plant is expected to be completed in Q2 2024.
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