CanAlaska Uranium : Fourth Quarter Report April 30, 2021 – MD&A and Financial Statements

CanAlaska Uranium Ltd. - MD&A April 30, 2021

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CanAlaska Uranium Ltd.

CVV - TSX-V CVVUF - OTCBB DH7N - Frankfurt

Management Discussion and Analysis

For the Fourth Quarter and Year Ended

April 30, 2021

Dated July 20, 2021

For further information on the Company reference should be made to the Company's public filings which are available on SEDAR. Information is also available at the Company's website www.canalaska.com. The following information is prepared in accordance with International Financial Reporting Standards (IFRS) and denominated in Canadian dollars, unless otherwise noted. This MD&A should be read in conjunction with the Company's audited consolidated financial statements for the year ended April 30, 2021.

Table of Contents:
1.	OVERVIEW OF THE COMPANY AND STRATEGY	2
2.	MILESTONES AND PROJECT UPDATES	3
3.	FINANCIAL POSITION	11
4.	EXPENDITURES REVIEW	16
5.	ANNUAL FINANCIAL INFORMATION	17
6.	CASHFLOW REVIEW	17
7.	OTHER MATTERS	17

This MD&A contains forward-looking information. Refer to section 6 "Forward-Looking Statements" and "Risks Factors" for a discussion of the risks, uncertainties and assumptions relating to such information.

www.canalaska.com

CanAlaska Uranium Ltd. - MD&A April 30, 2021

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1. OVERVIEW OF THE COMPANY

• Over 9 projects covering 168,000 hectares focused on Uranium, 1 project covering 52,000 hectares focused on Diamonds and 7 projects covering 30,000 hectares focused on nickel, copper and other minerals (section 1.1)
• Cash and cash equivalent resources of $7.0 million (as at April 30, 2021)
• 83,528,375 common shares issued and outstanding (July 20, 2021)

1.1 Profile and Strategy

The Company is an exploration stage company engaged in the acquisition and exploration of mineral properties, principally in Canada. The Company aims to acquire and advance its projects to a stage where they can be exploited at a profit or it can arrange joint ventures, whereby other companies provide funding for development and exploitation. The Company's principal focus has been the exploration for high-grade uranium deposits in the Athabasca Basin area of Saskatchewan and the exploration for copper/nickel in the same region. There are several projects on which the Company has expended recent efforts. The West McArthur project is under a joint venture 30% with Cameco Corporation ("Cameco"), the Cree East project was under a 50% joint venture with a Korean Consortium up to early July 2017, the Moon South project is under option to Denison Mines, the NW Manitoba project is under option to Northern Uranium Corp ("Northern Uranium") and the Quesnel project under option to Omineca Mining and Metals Ltd. Going forward it is expected that the Company will focus its effort on West McArthur, Cree East and selected base metal and precious metal opportunities. The Company is actively marketing the remainder of its projects for option, joint venture or sale.

Table 1: Canadian Strategic Property Summary
Property / Project Name	Notes	Hectares
West McArthur	Joint Venture with Cameco Corporation	36,000
Cree East	Seeking Venture Partner.	58,000
NW Manitoba	Joint Venture with Northern Uranium Corp.	23,000
Moon South	Joint Venture with Denison Mines	3,000
Hunter and Strong	Seeking Venture Partner	19,000
Manibridge	Option Agreement with D Block Discoveries Inc.	4,000
Quesnel	Option Agreement with Omineca Mining and Metals Ltd	1,000
NE Wollaston	Seeking Venture Partner	40,000
West Athabasca Kimberlite	Seeking Venture Partner.	52,000

The Company's exploration activities are managed through CanAlaska offices maintained in Vancouver, BC.

The Company believes that the fundamentals of the nuclear power industry and the economic superiority of uranium over other energy fuels will ensure the long-term future of global uranium markets and prices. Since 1985, CanAlaska has expended over $83 million of the total equity of $93.5 million on exploration and research towards the advancement of uranium, nickel and diamond discovery on our project areas. The information gained from this work has provided the Company with significant evidence about the nature and location of mineral rich hydrothermal systems in areas of the Athabasca where previous information was lacking. The increase in understanding of the geology of the target areas, and the integration of modern geophysical methods with data processing to get more precise target definition at depth gives management the confidence to continue exploration for large scale uranium deposits on our projects.

www.canalaska.com

CanAlaska Uranium Ltd. - MD&A April 30, 2021

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1.2 Strategic and Operating Intent

• Complete equity financing options over the next months
• Targeted marketing of uranium projects for financing
• Targeted marketing of non-core projects
• Strong commitment to option, joint venture or sale of individual exploration projects
• Evaluate alternate commodities and projects suitable for market financing, or acquisition and sale
• Company believes that it has the projects, strategic partners, people and knowledge base, corporate treasury and fund raising ability to maintain a position in the uranium exploration sector, but, due to increasingly difficult market conditions facing junior mining and junior uranium exploration companies, management has taken steps to streamline non-discretionary expenditures and financial overheads

As of July 19, 2021, the Company had 83,528,375 shares outstanding with a total market capitalization of $36.3 million. The Company's shares trade on the TSX Venture Exchange ("CVV") and are quoted on the OTCQB in the United States ("CVVUF") and the Frankfurt Stock Exchange ("DH7N").

The consolidated financial statements have been prepared under International Financial Reporting Standards ("IFRS") applicable to a going concern, which contemplates the realization of assets and settlement of liabilities in the normal course of business. For the year ended April 30, 2021, the Company reported a loss of $3.8 million and as at that date had cash and cash equivalents of $7.0 million, net working capital balance of $7.5 million and an accumulated deficit of $93.5 million.

The Company does not generate recurring revenues from operations and other factors may cast significant doubt regarding the Company's ability to continue as a going concern. Management believes that the cash on hand is sufficient to meet corporate, administrative and selected exploration activities for at least the next twelve months from April 30, 2021. Management may either need to dilute its ownership in its properties or secure additional financing to continue to advance the development of its exploration projects. Management has taken steps to streamline non-discretionary expenditures and financial overheads and is working to option, joint venture or sell its individual exploration projects.

2. MILESTONES AND PROJECT UPDATES

1. Overview- May 1, 2020 to July 20, 2021
2. • CanAlaska provides update on Manitoba Nickel projects (June 2021)
   • CanAlaska stakes fifth Thompson Nickel Belt project (June 2021)
   • CanAlaska stakes fourth Thompson Nickel Belt project (April 2021)
   • CanAlaska completes initial drilling at Waterbury (April 2021)
   • CanAlaska announces LOI with D Block Discoveries on Manibridge Nickel project (March 2021)
   • CanAlaska commences drilling for uranium at Waterbury project (March 2021)
   • Drilling commences at CanAlaska's copper-gold project (January 2021)
   • CanAlaska prepares for three separate drill programs (November 2020)
   • CanAlaska adds to NE Wollaston uranium project (October 2020)
   • CanAlaska options Quesnel porphyry copper project in BC to Omineca Mining and Metals Ltd (September 2020)
   • New uranium target discovered on Moon JV (June 2020)
   • CanAlaska identifies new target in NE Athabasca (May 2020)
   • CanAlaska stakes four large target areas in NE Athabasca (May 2020)
   • CanAlaska executes $9 million Thompson Nickel Deal (May 2020)
3. Project Updates

Overview

The Company currently has 16 projects within the Athabasca basin area. The majority of fiscal 2021 exploration spend was carried out on the Company's Waterbury project. The Company also carried out work on the West McArthur project, which was under an option to Cameco and is now under a 30% joint venture with Cameco. In fiscal 2021, the Company spent approximately $0.8 million on exploration.

www.canalaska.com

CanAlaska Uranium Ltd. - MD&A April 30, 2021

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Exploration spending in the fourth quarter of 2021 is down from the same comparative quarter of 2020. The overall decrease in fiscal 2021 compared to fiscal 2020 is largely due to exploration activities for the Manibridge, West Athabasca Kimberlite and West McArthur properties. During the fiscal year ended April 30, 2020, the Company had a drilling program at West McArthur which accounted for the majority of the exploration spend during the year.

The following table summarizes the Company's expenditures net of reimbursements for the year ended April 30, 2021.

				Other	Other and
Table 2: ($000's)	West			Athabasca	Generative
Total Exploration	McArthur	Waterbury	Manibridge	Projects	Projects	Total
Camp Cost & Operations	26	41	-	-	-	67
Drilling	-	405	-	-	-	405
General & Admin	33	37	12	51	86	219
Geochemistry	1	1	-	-	-	2
Geology	30	6	4	12	25	77
Geophysics	2	2	-	32	26	62
Other	1	-	-	-	5	6
Gross Expenditures	93	492	16	95	142	838
Reimbursement	-	-	-	-	(54)	(54)
Net Expenditures	93	492	16	95	88	784

The following section contains a comparative breakdown of project expenditures for the Company's significant projects.

2.2.1 West McArthur Project, Saskatchewan - Cameco

The West McArthur project in the Athabasca Basin, Saskatchewan, was optioned in April 2007 to Mitsubishi Development Pty Ltd., a subsidiary of Mitsubishi Corporation of Japan. Under the option agreement, Mitsubishi earned a 50% interest in the property and in January 2016, the Company entered into a buy back agreement with Mitsubishi for their 50% interest to then hold a 100% interest in the property. In February 2016, the Company then entered into an option agreement with Cameco Corporation. The option agreement enables Cameco to earn up to a 60% interest in the West McArthur project through total expenditures of $12.5 million until February 2022 ($725,000 received) consisting of cash payments to the Company and accelerating exploration programs, culminating in a joint venture. In October 2018, the Company entered into a 30/70 joint venture agreement with Cameco Corporation.

The West McArthur project is located between 6 and 30 kilometres west of the producing McArthur River uranium mine operated by Cameco Corp, and covers approximately 36,000 hectares. On the property, there is evidence of hydrothermal alteration extending well into the sandstone, matching the typical alteration model of Athabasca unconformity style uranium deposits. There is evidence of uranium mineralization from drill testing in multiple areas, either as enrichment (locally high grade) at the unconformity or in basement stringers. The most compelling features for further exploration are the uranium values in sandstone higher in the stratigraphy, the hematized and broken rock in the sandstone, and the pattern of basement offsets and geophysical conductivity.

The project is accessible during the winter drill season by seasonal winter ice roads and winter trails and during the summer exploration season by air and water. There is no physical plant or permanent infrastructure on the property and no source of power. However, the property is in close proximity to the McArthur River uranium mine operated by Cameco. There are multiple extensive lakes, which can provide a source of water for the project.

The mineral rights for West McArthur were acquired between October 2004 and February 2009 from the Ministry of Energy and Resources in the province of Saskatchewan, Canada. The claim numbers are as follows, S-107561,S-107562,S-107563,S-107565, S- 107773, S-108010,S-108011,S-108012,S-111412S-111413,S-111511 and S-111512. The mineral rights to West McArthur are valid and in good standing with the earliest claim, requiring renewal in October 2029 with no further exploration expenditures required. An annual assessment report is required to be filed by the Company with the Ministry of Energy and Resources to disclose the exploration activities on this claim. There is no fee for filing the annual assessment report.

The property has undergone a series of exploration programs, including extensive geophysics and drilling since 2005.

www.canalaska.com

CanAlaska Uranium Ltd. - MD&A April 30, 2021

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In May 2019, the Company reported that drill and camp contracts have been awarded for the summer drill program at the West McArthur uranium project. The program is intended to locate high-grade uranium hosted in faults along the C10 horizon, the major regional fault structure. Two previous drill holes intersected high-grade uranium - up to 5% U3O8 - just west of the projection of the C10 horizon and near the unconformity contact. CanAlaska believes the controlling structure of this high-grade mineralization has yet to be intersected in drilling. The summer drill program is being operated by CanAlaska, and follows on the three-year target definition by Cameco's drill team.

In June 2019, the Company reported that drilling has commenced at the West McArthur uranium project to expand current high grade uranium mineralization discovered in holes drilled by Cameco during their recent work program on the property. The program is intended to locate high-grade uranium hosted in faults along the C10 horizon, the major regional fault structure.

In September 2019, the Company reported that summer drilling was completed at the West McArthur uranium project. The unconformity related uranium mineralization intersected in Cameco's discovery holes WMA042 and WMA042-2, has been extended 50 metres to the south and 200 metres to the west and tied to down-hole geophysics imaging of the C10 conductor package. With downhole geophysics we have now located the C10 conductor horizon, approximately 100 metres south of the original high-grade discovery. There is highly elevated uranium, lead, cobalt, boron, nickel and copper in the mineralization and associated alteration halos in all of the drill holes where assays have been received to date. The program has successfully extended the discovery footprint of holes drilled by Cameco during their recent work programs on the property.

In October 2019, the Company reported high-grade uranium in final assay data for the recent drill program at the West McArthur uranium project. The mineralization containing high uranium, as well as base metal mineralization, is similar in character to the nearby high-grade Fox Lake uranium deposit of Cameco and Orano. Assay data for the latest drill holes, in particular for drill hole WMA055-2, has upgraded earlier U3O8 values up to 7.95%.

In October 2019, the Company reported that the latest West McArthur high-grade drill results include 6.8% U3O8 over 0.70 metres within a broad 650 metre by 400 metre geochemical halo - extending from bedrock to near-surface - provide strong support for continued drilling of the Grid 5 target zone in 2020.

In January 2020, the Company reported that crews resumed drilling at the West McArthur uranium project. The 2019 drill program successfully extended the discovery footprint of holes drilled by Cameco during their recent work programs on the property. The mineralization, containing high-grade uranium as well as base metal mineralization, is similar in character to the nearby high-grade Fox Lake uranium deposit of Cameco and Orano. Drilling in the winter will focus on a 300 metre length of the C10 conductor where current drilling has indicated the presence of a strong hydrothermal system and a well mineralized target.

In April 2020, the Company reported that crews were able to complete four drill holes from a planned six hole winter program at the West McArthur uranium project. Assays and data from the drill holes continue to show abundant structures in the sandstone above the unconformity near a large, yet to be tested, target. The last hole of the program WMA060, together with holes WMA054 and WMA058, confirms the model of a proximal mineralizing feeder zone oriented in a north to north-west direction.

The West McArthur property is without known reserves and any proposed program is exploratory in nature.

www.canalaska.com