Stockpiled mineralized material, work-in-process and finished goods inventories are measured at the lower of weighted average cost and net realizable value (“NRV”). Costs include direct labour and materials, mine-site overhead expenses, and depreciation and depletion of related property, plant and equipment. NRV is calculated as the estimated selling price based on prevailing metal prices, less estimated costs to complete processing and costs necessary to make the sale.

Stockpiled mineralized material represents material extracted from the mine and available for further processing. Costs are based on mining costs incurred up to the point of stockpiling and are relieved on a weighted average basis as material is processed.

Work-in-process represents material undergoing conversion into finished goods and includes the weighted average cost of mineralized material plus processing costs incurred up to the point prior to off-site refining.

Finished goods represent the final saleable product and include all accumulated mining and processing costs incurred prior to the off-site refining process.

Supplies inventories include the costs of consumables, including freight, to be used in operations and is measured at the lower of average cost and NRV, with replacement cost being the typical measure of NRV.

Write-downs of inventories to NRV are recognized in operating expenses in the period incurred. A previously recognized write-down is reversed in a subsequent period if there is an increase in the NRV of the related inventories, with the reversal limited to the amount of the original write-down.

Exploration and evaluation expenditures are incurred in connection with the Company’s activities to explore and evaluate mineral resources before the technical feasibility and commercial viability of extracting a mineral resource are demonstrable and Measured and Indicated Mineral Resources are established.

Costs incurred before the Company has obtained the legal right to explore are expensed as incurred. Once the legal right to explore has been obtained, the Company capitalizes the costs of acquiring exploration rights or licenses, including those purchased from third parties or staked directly by the Company, until such time as the rights or licenses expire, are abandoned, sold or considered impaired. Indirect administrative costs and costs of surveying, exploration drilling, sampling, materials, fuel, equipment rentals and payments to contractors are expensed as incurred during the exploration and evaluation stage. Expenditure relating to establishing technical feasibility and related studies are also expensed as incurred.

When technical feasibility and commercial viability of extracting a mineral resource are demonstrable and economically recoverable reserves or resources have been established, the property is deemed to be in the development stage and related costs are capitalized as development costs (Note 3(e)).

Exploration and evaluation properties are not amortized during the exploration and evaluation stage. Gains or losses on the sale of exploration and evaluation assets are recognized when the rights are transferred and the cost is derecognized, measured in accordance with the terms of the purchase or sale agreement and the percentage of interest sold.

Mining interests and construction-in-progress include:

Development costs are expenditures incurred subsequent to the establishment of technical feasibility and commercial viability. Development and construction costs are capitalized to construction-in-progress until the mine reaches commercial production, at which point the capitalized development and construction costs are reclassified to mining interests or property, plant and equipment. Commercial production is the point at which a mine is capable of operating in the manner intended by the Company’s management.

Goodwill is recognized in a business combination if the cost of the acquisition exceeds the fair values of the identifiable net assets acquired. Goodwill is then allocated to the cash generating unit (“CGU”) or group of CGUs that are expected to benefit from the synergies of the combination. A CGU is the smallest identifiable group of assets that generates cash inflows which are largely independent of the cash inflows from other assets or groups of assets.

The Company performs goodwill impairment tests on an annual basis in the fourth quarter of each year. In addition, the Company assesses for indicators of impairment at each reporting period-end and, if an indicator of impairment is identified, goodwill is tested for impairment at that time. If the carrying value of the CGU or group of CGUs to which goodwill is assigned exceeds its recoverable amount, an impairment loss is recognized. Goodwill impairment losses are recorded in the consolidated statements of income and they are not subsequently reversed.

The recoverable amount of a CGU or group of CGUs is measured as the higher of value in use and fair value less costs of disposal.

At the end of each reporting period, the Company assesses whether there is any indication that its property, plant and equipment (“PP&E”) may be impaired. Where it is not possible to estimate the recoverable amount of an individual asset, the Company groups assets into cash-generating units (“CGUs”), being the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets, for the purpose of assessing the recoverable amount.

Where an indicator of impairment exists, the recoverable amount of the asset or CGU is determined as the higher of its fair value less costs of disposal and its value in use. Fair value less costs of disposal is determined based on available data from arm’s length transactions for similar assets or using appropriate valuation models. Value in use is determined by estimating the present value of the future cash flows expected to be derived from the continued use of the asset or CGU.

An impairment loss is recognized for any excess of the carrying amount of the asset or CGU over its recoverable amount. Where a CGU includes goodwill, the impairment loss is first allocated to goodwill, with the remaining loss allocated on a pro rata basis to the other long-lived assets of the CGU based on their carrying amounts. Impairment losses recognized in respect of goodwill are not subsequently reversed. Impairment losses are recorded in the consolidated statements of income in the period in which they occur.

At the end of each reporting period, the Company assesses whether there is any indication that a previously recognized impairment loss on PP&E may no longer exist or may have decreased. If such an indication exists, the recoverable amount of the asset or CGU is estimated in order to determine whether a reversal is required. An impairment reversal is recognized to the extent that the recoverable amount of the asset or CGU exceeds its carrying amount. The amount of the reversal is limited to the carrying amount that would have been determined, net of depreciation or amortization, had no impairment loss been recognized in prior periods. The impairment reversal is allocated on a pro rata basis to the long-lived assets of the CGU based on their carrying amounts. Impairment reversals are recorded in the consolidated statements of income in the period in which they occur.

The Company is subject to environmental laws and regulations in the jurisdictions in which it operates. A provision for reclamation and closure costs is recognized when the Company has a present legal or constructive obligation as a result of past environmental disturbance, it is probable that an outflow of economic benefits will be required to settle the obligation, and the amount can be reliably estimated. The provision is measured as the present value of the risk-adjusted expenditures expected to be required to settle the obligation, discounted at a pre-tax rate that reflects the current market assessment of the time value of money.

Where the obligation relates to exploration and evaluation assets, changes in the reclamation and closure cost provision are recognized as an expense in the consolidated statements of loss and comprehensive loss in the period incurred. Where the obligation relates to mineral properties in development or production, the initial provision and any subsequent changes in the estimated amount or timing of future cash flows are capitalized as part of the carrying amount of the related mineral property and amortized using the same method as applied to the related asset.

Following initial recognition, the carrying amount of the provision is increased each period for the passage of time, with the unwinding of the discount recognized as accretion cost in the statement of loss and comprehensive loss. The provision is also adjusted for changes in the discount rate and for revisions to the estimated amount or timing of future cash flows required to settle the obligation. Where such changes relate to mineral properties in the development or production stage, the corresponding adjustment is recognized against the carrying amount of the related mineral property. Where such changes relate to exploration and evaluation assets, the corresponding adjustment is recognized in the consolidated statements of loss and comprehensive loss.

Share-based payments to employees are measured at the fair value of the instruments issued and recognized over the vesting periods. Share-based payments to non-employees are measured at the fair value of the goods or services received or the fair value of the equity instruments issued if it is determined the fair value of the goods or services cannot be reliably measured, and are recorded at the date the goods or services are received. The amount recognized as an expense is adjusted to reflect the number of awards expected to vest. The offset to the recorded cost is to equity settled share-based payments reserve.

Consideration received on the exercise of stock options is recorded as share capital and the related equity settled share-based payments reserve is transferred to share capital. Charges for options that are forfeited/cancelled before vesting are transferred from equity settled share-based payment reserve to deficit. Charges for options that are expired remain in equity settled share-based payment reserve.

Where the terms and conditions of options are modified before they vest, the incremental change in fair value of the options, measured immediately before and after the modification, is also charged to profit or loss over the remaining vesting period.

Revenue is principally generated from the sale of gold and silver bullion with each shipment considered as a separate performance obligation. The Company recognizes revenue from these sales when control of the gold or silver has transferred to the customer. This is generally at the point in time when the gold or silver is credited to the metal account of the customer after completion of the refining process. Once the gold or silver has been credited to the customer’s metal account, the customer has legal title to, physical possession of, and the risks and rewards of ownership of the gold or silver; therefore, the customer is able to direct the use of and obtain substantially all of the remaining benefits from the gold or silver.

Revenue is measured at the transaction price agreed under the contract. Payment of the transaction price is due immediately when control of the gold or silver is transferred to the customer.

Financial assets and liabilities are recognized when the Company becomes a party to the contractual provisions of the instrument. Financial assets are derecognized when the rights to receive cash flows have expired or substantially all risks and rewards of ownership have been transferred. Gains and losses on derecognition are generally recognized in profit and loss. Financial liabilities are derecognized when the Company’s obligation has been discharged, cancelled or expired.

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. Financial assets that are held within a business model whose objective is to collect the contractual cash flows, and that have contractual cash flows that are solely payments of principal and interest are measured at amortized cost at the end of the subsequent accounting periods. All other financial assets including equity investments and secured notes are measured at their fair values at the end of subsequent accounting periods, with any change taken through profit or loss or other comprehensive income. Financial liabilities include accounts payable and lease liabilities, which are measured at amortized cost. All financial instruments are initially recognized at fair value on the statement of financial position.

Purchases and sales of investments are recognized on the settlement date. Realized gains and losses on disposal of investments and unrealized gains and losses in the fair value of investments are reflected in the statement of loss and comprehensive loss. Upon disposal of an investment, previously recognized unrealized gains or losses are reversed so as to recognize the full realized gain or loss in the period of disposition. All transaction costs associated with the acquisition and disposition of investments are expensed to the statement of loss and comprehensive loss as incurred.

The fair value of investments is determined as follows:

An associate is an entity over which the investor has significant influence but not control and that is neither a subsidiary nor an interest in a joint venture. The Company’s share of the net assets and net earnings or loss is accounted for in the consolidated financial statements using the equity method of accounting.

Under the equity method, the Company’s investment in an associate is initially recognized at cost and subsequently increased or decreased to recognize the Company’s share of net earnings and losses of the associate, after any adjustments necessary to give effect to uniform accounting policies, any other movement in the associate’s reserves, any dilution gains /losses as a result of changes in equity interest, and for impairment losses after the initial recognition date. The Company’s share of an associate’s losses that are in excess of its investment are recognized only to the extent that the Company has incurred legal or constructive obligations or made payments on behalf of the associate. The Company’s share of earnings and losses of associates are recognized in net earnings/(loss) during the period. Dividends and repayment of capital received from an associate are accounted for as a reduction in the carrying amount of the Company’s investment. Unrealized gains and losses between the Company and its associates are recognized only to the extent of unrelated investors’ interests in the joint ventures and associates. Intercompany balances and interest expense and income arising on loans and borrowings between the Company and associates are not eliminated.

The Company will from time to time issue flow-through common shares to finance a portion of its exploration program. Pursuant to the terms of the flow-through share agreements, these shares transfer the tax deductibility of qualifying resource expenditures to investors. On issuance, the Company bifurcates the flow-through share into i) a flow-through share premium, equal to the estimated premium, if any, investors pay for the flow-through feature, which is recognized as a liability, and ii) share capital. Upon expenditures being incurred, the Company derecognizes the liability and recognizes a deferred tax liability for the amount of tax reduction renounced to the shareholders. The premium is recognized as recovery of flow-through premium liability and the related deferred tax is recognized as a tax provision.

The Company is subject to the flow-through share rules under the Income Tax Act of Canada. Proceeds received from the issuance of flow-through shares are required to be used only for Canadian resource property exploration expenditures within a specified time. The Company may also be subject to Part XII.6 tax on flow through proceeds renounced but not spent under the Look-Back Rules. When applicable, this tax is accrued as an expense.

Income tax on the profit or loss for the years presented comprises current and deferred tax. Income tax is recognized in profit or loss except to the extent that it relates to items recognized directly in equity, in which case it is recognized in equity.

Current tax expense is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at year end, adjusted for amendments to tax payable with regards to previous years.

In April 2024, the IASB issued IFRS 18, Presentation and Disclosure in Financial Statements (“IFRS 18”), which replaces IAS 1, Presentation of Financial Statements (“IAS 1”). IFRS 18 retains many of the requirements of IAS 1 but introduces significant changes in the following key areas:

The statement of profit or loss will be required to present three new defined categories: operating, investing, and financing, with specified subtotals including operating profit and profit before financing and income taxes. The classification of income and expenses into these categories is based on the nature of the entity’s main business activities.

IFRS 18 also introduces requirements for entities to disclose management-defined performance measures (“MPMs”) in the notes to the financial statements. MPMs are subtotals of income and expenses that are used in public communications outside the financial statements, that complement the totals and subtotals specified by IFRS Standards, and that communicate management’s view of an aspect of the entity’s financial performance. Companies will be required to provide reconciliations of MPMs to the most directly comparable subtotal specified by IFRS 18, along with disclosure of the income tax effect and effect on non-controlling interests.

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The Company held the following warrants as at December 31, 2024:

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