EnviroMetal Technologies : Management Discussion and Analysis

Management Discussion and Analysis

For the three and six-month periods ended June 30, 2022 and 2021

EnviroMetal Technologies Inc.

Management Discussion and Analysis

For the three and six-month periods ended June 31, 2022 and 2021

1. INTRODUCTION

This Management Discussion and Analysis (MDA) has been prepared to provide material updates and analysis of the business operations, financial condition, financial performance, cash flows, liquidity, and capital resources of EnviroMetal Technologies Inc. (EnviroMetal or the Company) (formerly EnviroLeach Technologies Inc).

The information provided herein should be read in conjunction with the Company's unaudited condensed consolidated interim financial statements (Interim Financial Statements) and the notes thereto for the six-month period ended June 30, 2022 and the audited financial statements for the year ended December 31, 2021. The Financial Statements have been prepared in accordance with International Financial Reporting Standards (IFRS).

Except as otherwise disclosed, all dollar figures in this report are stated in Canadian dollars. The effective date of this report is August 29, 2022.

EnviroMetal Technologies Inc. is listed on the Canadian Securities Exchange (the CSE) under the symbol ETI and began trading on March 30, 2017. In addition to the listing on the CSE, the Company also trades on the OTCQX and Frankfurt Stock Exchange under the symbols EVLL and 7N2, respectively.

The Company has developed a unique, cost-effective, cyanide free, alternative to current broadly used methods for the hydrometallurgical extraction of precious metals from ores, concentrates and other host materials for use in the primary and secondary metals recovery industries.

Statements in this report that are not historical facts are forward-looking statements involving known and unknown risks and uncertainties, which could cause actual results to vary considerably from these statements. Readers are cautioned not to put undue reliance on forward-looking statements. See Forward-Looking Information and Statements herein.

Information related to the Company is available for view on SEDAR at www.sedar.comand more information is also available on the Company's website at www.EnviroMetal.com.

Corporate Overview

EnviroMetal develops and markets technologies for the extraction of precious and other valuable metals from mine products and printed circuit board assemblies (PCBA) in a safe, environmentally friendly, and sustainable manner. The Company's technology can be used in the mining industry to recover gold from ores and concentrates, and in the electronic waste (E- waste) processing industry to recover gold and other valuable metals from printed circuit board assemblies. The Company operates a large pilot scale E-waste processing facility (EnviroCircuit) located in Surrey, British Columbia and is seeking opportunities to license its technology to companies in the mining and E-waste industries.

The EnviroMetal leach process is similar to conventional gold recovery methods, but the Company's proprietary lixiviant and unique process eliminates the use of toxic leaching agents such as sodium cyanide and strong acids and significantly

reduces water consumption. EnviroMetal's metal recovery technology targets industry participants seeking an on site or

domestic processing solution with low logistics and third-party costs and a reduced environmental impact.

The Company's patented metal recovery technology creates strong differentiation in the marketplace and pending and awarded patents combined with the process knowledge required for use and site optimization create significant barriers for competitors to overcome. The EnviroMetal process is cost competitive, safe, sustainable, and holds potential for multiple revenue streams.

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EnviroMetal Technologies Inc.

Management Discussion and Analysis

For the three and six-month periods ended June 31, 2022 and 2021

2. OVERALL PERFORMANCE AND OPERATIONS

During the period ended June 30, 2022, the Company continued to develop commercial relationships in the primary and secondary metals industries. In the primary metals industry, the Company is focussed on opportunities for the recovery of gold from concentrates and ores. In the secondary metals industry, the focus is the recovery of gold and other metals from electronic waste.

While EnviroMetal continues to explore opportunities for processing E-waste and build and expand its E-waste supply network to provide feed for the EnviroCircuit facility it is clear the E-waste processing industry has dramatically changed over the past 3 years. Factors, largely outside the Company's control, including; a dramatic increase in local and international logistics costs, a significant drop in North American E-waste recycling levels, an increased focus on asset destruction or repair and refurbishment for high value E-waste, programs and policies encouraging the shredding and incineration of low-gradeE-waste, and substantial increases in logistics costs have all contributed to much lower levels of E-waste available and dramatically higher prices.

In response to the changes the E-waste processing industry is experiencing, the Company is shifting its E-waste focus from directly procuring material to providing processing support and potentially licensing its gold recovery technology and other IP to E-waste processors. During the quarter ended June 30 and during the balance of 2022, EnviroMetal's E-waste focus will be processing E-waste for clients to generate additional operational data, identifying licensing opportunities, and refining the E-waste process to support licensing.

EnviroMetal continues to develop relationships with mining companies and other mining related entities in pursuit of licensing opportunities. For miners, the selection of a metal recovery technology is dependent on many factors including total metal recovery, capital costs, operating costs, permitting, site suitability, reliability, ease of use, industry standards and sustainability. As is the case with any metallurgical process prior to adoption for use the processing technology must go through a series of progressive tests from lab through pilot scale in order to ensure the compatibility of the technology with the material to be processed. The Company has identified a number of potential licensees, based on material type and project specific criteria, and has initiated metallurgical test work for or entered into discussions with several of them.

During the period ended June 30, 2022, EnviroMetal conducted lab and pilot scale work for several mining clients and recognized revenues of $81,648 related to this work. Metalurigical consulting work is an essential step for securing future licensing agreements and the Company anticipates increased consulting revenues from work for existing and new clients as it develops relationships with potential licensees and partners.

Recognizing the Company's then current lease was up for renewal and in anticipation of increased client support work, in April the Company secured a larger laboratory and office space. The new facility was acquired on similar lease terms to the expiring lease and features additional office space and an expanded laboratory with room for pilot scale test work.

In 2021, the Company entered into an agreement with Ocean Partners USA Inc., an affiliate of Ocean Partners Holdings Limited pursuant to which EnviroMetal would recover gold from gold mine materials produced by Ocean Partner's clients. On December 31, 2021, the Company held in inventory material from Ocean Partners clients with an estimated value of $3,441,965. During the period ended June 30, 2022, the Company processed the material and recovered over 1,440 troy ounces of gold recognizing related revenues of $3,463,259,708 and material costs of $3,389,518. While the Company's focus remains licensing its technology to clients in the mining and E-waste industries it remains open to custom processing client material as a revenue source and opportunity to demonstrate the broad applicability of its metal recovery technologies.

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EnviroMetal Technologies Inc.

Management Discussion and Analysis

For the three and six-month periods ended June 31, 2022 and 2021

COVID-19 Pandemic Impacts

The COVID-19 pandemic has directly and dramatically impacted EnviroMetal's business. Due to isolation and quarantine requirements for businesses and limits on travel and commercial shipments the E-waste supply chain and resulting supply of the Company's target feedstock of PCBA continues to be severely impacted. Shortly after the EnviroCircuit pilot plant received R2/RIOS certification, which positioned the Company for commercial level operations and revenue, almost all E- waste supply within the Company's supply network was disrupted.

The COVID-19 pandemic has also negatively affected international shipping with freight costs, container availability and port access having been severely impacted. Higher shipping and port costs, and border, customs and port disruption have resulted in delays in receiving feedstock, increased downtime, higher operating costs and interruptions in shipping finished materials to customers.

3. SUMMARY OF QUARTERLY RESULTS

The following summarized financial data has been prepared in accordance with IFRS. This data should be read in conjunction with the Company's interim financial statements, and it consolidated annual financial statements for the respective periods. All net loss figures in the table are presented in Canadian dollars, the Company's functional currency.

The Company has yet to achieve consistent revenues from E-waste processing, consulting or licensing activities and therefore has un-predictable cashflows from the sale of processed materials or revenues from its intellectual property. Although the Company continues to pursue E-waste opportunities the primary focus is on mining related opportunities where projected margins are substantially higher, and risks are lower. EnviroMetal believes by providing technical solutions which address potential clients' operational needs allowing them to unlock unrealized potential in their mining projects or improve profitability the Company will achieve consistent and increasing revenues over time.

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EnviroMetal Technologies Inc.

Management Discussion and Analysis

For the three and six-month periods ended June 31, 2022 and 2021

4. OPERATIONAL RESULTS FOR THE PERIOD

The following table summarizes the Company's revenues and expenses for the three and six-month periods ended June

30, 2022 and 2021:

Revenues- The Company recognized revenue of -$2,298 and $3,753,668 during the three and six-month periods ended June 30, 2022, compared to $561,967 and $605,168 during the 2021 comparative periods. Consulting revenues were $33,198 (2021: -$1,154) during the three-month period and $81,648 (2021: $3,977) during the six-month period ended June 30, 2022. Mineral processing revenues during the three and six- month periods were $3,463,259 (2021: $nil) and revenues from E-waste processing during the three and six-month period were $208,761 (2021: $601,191). Negative revenue amounts reflect differences between initial metals payments and final settlement for metals sold.

Operating Costs- The operating expenses to sales ratios were consistent during the six-month periods ended June 30, 2022, and June 30, 2021, at 0.96. During the six-month period ended June 30, 2022, higher margin consulting work partially offset the influence of COVID programs including government rent subsidies (2022: $nil (2021: $85,907)) which reduced operating costs during the comparative period.

Management and Employee costs- Management and employee compensation costs during the three and six-month periods ended June 30, 2022, were $509,548 (2021: $338,387) and $1,034,925 (2021: $703,073) respectively. The increase in costs reflects increased staffing levels in 2022 and the reduction in management and employee costs during 2021 as the Company benefited from the Canada Emergency Wage Subsidy during the three-month period, $104,492, and six-month period, $213,640, ended June 30, 2021. The Company also benefitted from IRAP funding related to copper and tin recovery which reduced wage costs during the six-month period ended June 30, 2022, $35,5517 (2021: $54,094) and three-month period ended June 30, 2021, $18,577.

General and administrative- During the three-month periods ended March 31, 2022 and 2021, general and administration costs were as follows:

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