FPX Nickel : MD&A for year ended December 31, 2023

FPX NICKEL CORP.

Management's Discussion and Analysis

For the three months and year ended December 31, 2023

FPX NICKEL CORP.

Management's Discussion and Analysis

For the three months and year ended December 31, 2023

This Management's Discussion and Analysis ("MD&A") has been prepared by management as of March 13, 2024 (the "Report Date") with reference to National Instrument 51-102 - "Continuous Disclosure Obligations" of the Canadian Securities Administrators and contains information up to and including the Report Date. This MD&A should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2023 of FPX Nickel Corp. ("FPX Nickel", or the "Company") and the related notes thereto, which have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board.

Certain dollar amounts in this MD&A have been rounded for ease of reading. All amounts are expressed in Canadian dollars unless otherwise noted.

This MD&A contains forward-looking statements. Readers are cautioned as to the risks and uncertainties related to the forward-looking statements, the risks and uncertainties associated with investing in the Company's securities, and the risks and uncertainties associated with technical and scientific information under National Instrument 43-101 ("NI 43-101") concerning the Company's projects, including information about mineral resources.

Additional information relating to the Company is available for viewing under the Company's profile on the SEDAR+ website at www.sedarplus.ca.

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FPX NICKEL CORP.

Management's Discussion and Analysis

For the three months and year ended December 31, 2023

OVERVIEW

FPX Nickel was incorporated as a junior capital pool company in the province of Alberta on February 2, 1995, and established itself as a mineral exploration company in June 1996. The Company has one majority-owned subsidiary, CO2 Lock Corp., incorporated in British Columbia.

The Company explores primarily for nickel deposits, none of which have been advanced to the point where a production decision can be made. Consequently, the Company has no producing properties, and no sales or revenues.

The Company's exploration efforts are focused on the exploration and development of properties containing awaruite, a naturally occurring nickel-iron alloy. FPX Nickel holds a 100% interest in five awaruite properties: four in British Columbia and one in the Yukon Territory. The Company's primary project is the Baptiste deposit ("Baptiste" or the "Project") located within its flagship Decar Nickel District ("Decar").

The Company's shares are listed on the TSX Venture Exchange ("TSX-V"), trading under the symbol "FPX" and on the OTCQB under the symbol "FPOCF".

2023 HIGHLIGHTS

Project

• In September 2023, announced results from the preliminary feasibility study ("PFS") for Baptiste. Highlights from the PFS include:
  o After-tax NPV8% of US $2.01 billion and IRR of 18.6% at US$8.75/lb Ni

1. 29-yearmine life producing an average 59,100 tonnes per year of nickel

1. Phased development approach, with expansion following the 3.7-yearafter-tax payback period

1. Life-of-mine("LOM") average C1 operating cost of US$3.70/lb Ni (US$8,150/t), assuming no byproduct credits

1. LOM average annual pre-tax cashflow of US$578 million during operating years

1. Strategic product flexibility, with a base case high-grade nickel concentrate (60% nickel) for direct feed to the stainless steel industry, plus a refinery option to produce battery-grade nickel sulphate

Corporate

• In October 2023, announced the appointment of Felicia de la Paz, Chief Financial Officer and Corporate Secretary.
• In September 2023, entered into a non-binding memorandum of understanding ("MOU") with Japan Organization for Metals and Energy Security ("JOGMEC") and the Prime Planet Energy & Solutions ("PPES") joint venture between Toyota Motor Company and Panasonic Corporation to explore collaborative opportunities for the vertical integration of nickel production involving the development of Baptiste.
• In August 2023, announced the appointment of Tim Bekhuys, Senior Vice President, Environment & External Affairs.

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FPX NICKEL CORP.

Management's Discussion and Analysis

For the three months and year ended December 31, 2023

• In May 2023, completed a $16,080,000 private placement financing with global stainless steel producer, Outokumpu Oyj ("Outokumpu"), issuing 26,800,000 common shares at a price of $0.60 per common share, for a 9.9% interest in the Company.

• 1. In connection with the financing, the Company's existing Corporate Strategic Investor exercised its participation right to maintain its 9.95% interest in FPX Nickel. The Company issued an additional 3,251,184 common shares at a price of $0.60 per common share and received proceeds of $1,951,000.
• In March 2023, entered into a Global Generative Exploration Alliance ("Generative Alliance") with JOGMEC and funded solely by JOGMEC to carry out worldwide mineral exploration activities to identify high-quality properties which are prospective for the same style of awaruite nickel mineralization as contained at the Company's Baptiste resource.
• 1. In June 2023, announced the appointment of Keith Patterson, Vice-President of Generative Exploration to direct the operations of the Generative Alliance.
• In March 2023, the Company was granted $725,000 in non-dilutive,non-repayable government funding from Natural Resources Canada ("NRCan") under the Critical Minerals Research, Development and Demonstration ("CMRDD") program to accelerate studies on the technical and economic viability to produce battery-grade nickel sulphate and cobalt hydroxide for the electric vehicle supply chain.

Recent Developments

• In January 2024, completed a $14,450,000 private placement financing with a new cornerstone strategic investor, Sumitomo Metal Mining Canada Ltd. ("Sumitomo"). Under the terms of the private placement, the Company issued 30,104,488 common shares at a price of $0.48 per common share, for a 9.9% interest in the Company.

• 1. In connection with the financing, the Company's existing Corporate Strategic Investor, Outokumpu and Sumitomo exercised their participation rights to maintain their respective interests in FPX Nickel. The Company issued an additional 8,981,971 common shares at a price of $0.48 per common share for gross proceeds of $4,311,346.
• In February 2024, announced the appointment of Kim Baird to the Company's Board of Directors.
• In February 2024, granted 3,985,000 restricted share units ("RSUs") to officers, employees and non- executive directors. Each RSU will entitle the holder to receive one common share of the Company or the equivalent cash value upon settlement.

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FPX NICKEL CORP.

Management's Discussion and Analysis

For the three months and year ended December 31, 2023

PROJECTS

The Company's exploration program involves a search for disseminated nickel-iron alloy targets that occur in a very specific geological environment found within ultramafic rocks. Awaruite, the nickel-iron alloy of interest, contains approximately 77% nickel, the rest being iron with occasional minor cobalt and copper (which appear to substitute for nickel in awaruite). Awaruite is strongly magnetic and very dense, two properties which allow for its efficient physical separation, along with magnetite, into a magnetics concentrate via three stages of comminution and magnetic separation. Conventional froth flotation is then used to separate the awaruite from magnetite, resulting a very high-grade nickel concentrate (60% nickel). There is virtually no sulphur in the resource, which eliminates a number of typical environmental issues typically associated with mining, processing, and waste management for nickel sulphide deposits. Furthermore, because of the virtual absence of sulphur, the nickel concentrate produced does not require intermediate smelting or primary refining ahead of feed to either the stainless steel industry or secondary refining to produce battery-grade materials.

Decar Nickel District, British Columbia

The Company's Decar Nickel District claims cover 245 square kilometres of the Mount Sidney Williams ultramafic/ophiolite complex, located 90 km northwest of Fort St. James in central British Columbia. The Company holds a 100% interest in Decar since 2016 and has held a continuous ownership interest since first staking claims in the area in 2007.

Decar hosts a greenfield discovery of awaruite, with the resource amenable to bulk-tonnage,open-pit mining. Awaruite mineralization has been identified in four target areas within this ophiolite complex, being the Baptiste Deposit, as well as the B, Sid and Van targets, as confirmed by drilling, petrographic examination, electron probe analyses and outcrop sampling on all four. Of the four targets, the Baptiste Deposit, which was initially the most accessible and had the biggest known surface footprint, has been the focus of increasing resource definition (a total of 99 holes and 33,700 m of drilling completed). The Baptiste Deposit is located within the Baptiste watershed, on the traditional and unceded territories of Tl'azt'en Nation and Binche Whut'en, and within several Tl'azt'enne and Binche Whut'enne keyohs.

In Q3 2023, the Company announced the results from the PFS for Baptiste, with an after-tax NPV8% of US$2.01 billion and IRR of 18.6% at US$8.75/lb Ni. The PFS demonstrates the potential to develop a high- margin, long-life,large-scale and low-carbon mine with unparalleled flexibility to produce either a high- grade concentrate (60% nickel) for direct feed into the stainless steel industry (the "Base Case") or further refining into battery-grade nickel sulphate, cobalt precipitate and copper concentrate products for the battery material supply chain (the "Refinery Option").

The Base Case outlines an open-pit mining project which will produce an average of 59,100 tonnes of nickel per year in concentrate over a 29-year mine life. The project will be developed in a phased approach, with an initial mill throughput rate of 108,000 tonnes per day ("Phase 1"), followed by an expansion to 162,000 tonnes per day ("Phase 2") funded from free cash flow after the initial after-tax payback period of

3.7 years. The mining strip ratio averages 0.41 in Phase 1, and 0.56 overall for life-of-mine (excluding capitalized pre-stripping).

The Project will utilize a conventional processing flowsheet with SAG-mill based grinding followed by magnetic separation, froth flotation, and a flotation tailings leach circuit. Overall Davis Tube Recoverable ("DTR") nickel recovery is estimated to average 88.7% for the life-of-mine, with 93% of the nickel produced contained in a high-grade flotation concentrate (60% nickel) and the balance (7% of nickel produced) contained in a mixed hydroxide precipitate ("MHP") produced from the tailings leach circuit.

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FPX NICKEL CORP.

Management's Discussion and Analysis

For the three months and year ended December 31, 2023

The Project has an estimated Scope 1 and 2 carbon intensity of 2.4 t CO2/t nickel produced, placing Baptiste within the lowest decile of global nickel production. The Project will be accessed by a road system consisting of upgrades and expansions to an existing forest service road network. All mine tailings and waste rock are proposed to be managed within a single integrated facility that will utilize open pit pre- stripping material and waste rock for embankment construction.

Base Case economics are presented below, based on a US$8.75/lb nickel price.

1Exclusive of any byproduct credits.

2Inclusive of operating cost, sustaining capital, expansion capital, closure capital, and royalties. 3For production years

The Refinery Option outlines an off-site refinery to upgrade a portion of nickel-in-concentrate to produce 40,000 tonnes per annum of battery-grade nickel sulphate for the electric vehicle battery supply chain, with the balance of concentrate continuing to be directly supplied to the stainless steel industry. Along with battery-grade nickel sulphate, this option also supports the valorization of cobalt and copper as refinery byproducts. The Refinery Option presents incremental capital expenditure of US$448 million with an incremental operating cost of US$1.02 per pound of nickel (C1 cost of US$0.79/lb Ni, including credits for cobalt and copper byproducts), resulting in total NPV8% of US$2,127 million.

The Baptiste deposit will be mined as a conventional large-scale truck and shovel operation with up to 60 Mt of material mined per year during Phase 1 and up to 120 Mt of material mined per year during Phase

2. The mining operation will feature 250 mm blast-hole electric drills, 42 m3 electric excavators, and 300 t haul trucks working on nominal 10 m high benches. A flexible combination of dozers, graders, wheel loaders and excavators will form the core of the support equipment fleet.

The mineral resource estimate (effective November 14, 2022) is based on updated drilling from the 2021 season, informing the Baptiste deposit geological model. The Probable Mineral Reserves for the project are estimated at 1,488 Mt at an average grade of 0.13% DTR nickel (0.21% total nickel), resulting in 1,933 kt of contained DTR nickel metal (3,125 kt of total nickel metal) over the 29-year mine life. Included in waste material for the PFS are 44 Mt of inferred material at an average grade of 0.113% DTR nickel.

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FPX NICKEL CORP.

Management's Discussion and Analysis

For the three months and year ended December 31, 2023

The Baptiste Nickel Project Reserve Estimate is as follows:

Notes:

1. Mineral Reserves are reported effective September 6, 2023. The Qualified Person for the estimate is Mr. Cristian Hernan Garcia Jimenez, P.Eng., and independent consultant.
2. Mineral Reserves are reported using a fixed 0.06% DTR Ni cut-off grade, which represent approximately US$9.00/t NSR value, which is above the economic cut-off grade of US$5.5/t.
3. The Mineral Reserves are supported by a mine plan, based on a pit design, guided by a Lerchs Grossmann (LG) pit shell. Inputs to that process are:
4. • Metal prices of Ni US$8.75/lb.
   • Mining cost US$1.98/t moved.
   • An average processing cost of US$3.72/t milled, which includes processing and tailing storage costs.
   • General and administrative cost of US$1.10/t milled.
   • Pit overall slope angles varying from 42 to 44 degrees.
   • A fixed process recovery of 85% for all the measured and indicated blocks above 0.06% DTR nickel grade.
5. The life-of-mine strip ratio is 0.56 (w:o), excluding capitalized stripping.
6. Tonnage and contained nickel tonnes are reported in metric units and grades are reported as percentages.
7. All figures are rounded to reflect the relative accuracy of the estimate. Totals may not sum due to rounding as required by reporting guidelines.

2024 Outlook

The Company's 2024 work plan is focused on prioritizing critical path activities in preparation for entry into the Provincial and Federal environmental assessment ("EA") in the first quarter of 2025. Critical readiness activities for the EA are focused on three key areas: collaboration with Indigenous communities, cultural and environmental baseline studies, and engineering studies and feasibility readiness.

In 2024, the Company will continue to establish EA agreements with all potential participating Indigenous communities. FPX is committed to building relationships with Indigenous communities early and through inclusive processes, providing resources to enable engagement and collaborative decision-making, enabling Indigenous communities to advance self-determined goals, and optimizing long-term sustainable benefits and opportunities connected to the Project.

A collaborative decision-making process with Indigenous communities is planned to begin in 2024 to determine key aspects of mine design including tailings facility location and powerline routing, in advance of entering the EA process.

The 2024 cultural and environmental baseline studies program will include an expansion of activities in the Project area, and commencement of studies focused on linear infrastructure, including the Project access road and powerline corridors.

FPX is committed to the execution of an Indigenous-led cultural and environmental baseline program. To achieve this, the Company has prioritized engagement of Indigenous-owned businesses and partnerships, such as Shas-Ti Environmental LP and Sasuchan Environmental LP, to ensure integration of Indigenous perspectives into the scoping and execution of these studies.

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FPX NICKEL CORP.

Management's Discussion and Analysis

For the three months and year ended December 31, 2023

In 2024, engineering work will be centered on metallurgical testing and value engineering activities. The Company is commencing on a feasibility study ("FS") metallurgical program which is focused on refining select elements of the flowsheet and additional testing to support feasibility study detailing. The FS metallurgical program is expected to run through 2025.

Value engineering studies will look to further improve project value and provide a suitable layout and execution certainty ahead of the EA process. To this effect, concurrent value engineering studies are focusing on optimization of the following areas: process plant design, overall site layout, carbon intensity, and linear infrastructure (access road and powerline).

CORPORATE

Corporate Development

In September 2023, the Company entered into a non-binding MOU with JOGMEC and PPES to explore collaborative opportunities for the vertical integration of nickel production involving the development of Baptiste. Under the terms of the MOU, the Company, JOGMEC and PPES will share technical information and expertise and explore potential strategic arrangements and business structures.

It is anticipated that any potential binding agreements among the parties would provide the Company with additional funding to advance the Baptiste Project, including the preparation of feasibility study and activities relating to the environmental assessment and permitting processes. The MOU is non-exclusive and non-binding, and there can be no certainty that a binding commercial agreement among the parties will arise from this framework; further, there is no fixed timing envisioned among the parties for the execution of any binding agreements.

Strategic Investments

Outokumpu Private Placement

In May 2023, the Company closed a $16,080,000 private placement financing (the "Outokumpu Private Placement") with Outokumpu, a major global stainless steel producer. Under the terms of the Outokumpu Private Placement, the Company issued 26,800,000 common shares at a price of $0.60 per share. Upon completion of the Outokumpu Private Placement, Outokumpu owns approximately 9.9% of FPX Nickel's issued and outstanding common shares on a non-diluted basis. Proceeds from the Outokumpu Private Placement will be used primarily for development activities at Baptiste, including completion of the preliminary feasibility study, environmental baseline activities and feasibility study readiness, as well as general corporate and administrative purposes.

Concurrent with the closing of the Outokumpu Private Placement, the Company granted to Outokumpu a right of first offer to negotiate, at market terms, one or more offtake agreements with the Company for up to an aggregate of 60,000 tonnes of nickel (7,500 tonnes of nickel per year over an eight-year period) from Baptiste. The Company and Outokumpu also entered into an investor rights agreement that provides, among other things, Outokumpu with certain rights in the event it maintains minimum ownership thresholds in the Company, including the right to participate in equity financings. In addition, pursuant to the Outokumpu Private Placement, Outokumpu is subject to a two-year standstill with respect to the acquisition of additional securities in the Company, other than acquisitions pursuant to Outokumpu's rights under its investor rights agreement.

In connection with the Outokumpu Private Placement, the Company's existing Corporate Strategic Investor exercised its participation right to re-establish a 9.95% ownership in the Company. As a result of the participation of the Corporate Strategic Investor, an additional 3,251,184 common shares were issued at a price of $0.60 per share, for gross proceeds of $1,951,000.

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FPX NICKEL CORP.

Management's Discussion and Analysis

For the three months and year ended December 31, 2023

Sumitomo Private Placement

In January 2024, the Company closed a $14,450,000 private placement financing (the "Sumitomo Private Placement") with Sumitomo. Under the terms of the Sumitomo Private Placement, the Company issued 30,104,488 common shares at a price of $0.48 per share. Upon completion of the Sumitomo Private Placement, Sumitomo owns approximately 9.9% of FPX Nickel's issued and outstanding common shares on a non-diluted basis. Proceeds from the Sumitomo Private Placement will be used primarily for exploration and development activities at Baptiste, continuance of ongoing environmental baseline activities, feasibility study readiness activities and general corporate and administrative purposes. The Company paid financing fees of $578,000 in association with the Sumitomo Private Placement.

Concurrent with the closing of the Sumitomo Private Placement, the Company granted to Sumitomo a right of second offer to negotiate, at market terms, one or more offtake agreements with the Company for up to an aggregate of 60,000 tonnes of nickel from Baptiste, with the timing and annual volume of such offtake to be negotiated at a later date. Sumitomo's offtake right will rank secondary to the offtake right granted to Outokumpu. The Company and Sumitomo also entered into an investor rights agreement that provides, among other things, Sumitomo with certain rights in the event it maintains minimum ownership thresholds in the Company, including the right to participate in equity financings. In addition, pursuant to the Sumitomo Private Placement, Sumitomo is subject to a two-year standstill with respect to the acquisition of additional securities in the Company, other than acquisitions pursuant to Sumitomo's rights under its investor rights agreement.

In connection with the Sumitomo Private Placement, the Company's existing Corporate Strategic Investor, Outokumpu and Sumitomo (collectively, the "Strategic Investors") exercised in full, their participation rights to re-establish their respective initial ownership interests in the Company. FPX Nickel issued a total of 8,981,971 common shares to the Strategic Investors at a price of $0.48 per common share for gross proceeds of $4,311,346. The Company paid financing fees of $17,000 in association with the top-up financing.

JOGMEC Generative Exploration Alliance

On March 29, 2023, the Company and JOGMEC initiated the Generative Alliance to carry out mineral exploration activities for the identification, acquisition and development of high-quality awaruite nickel targets on a worldwide basis.

During the first phase of the Generative Alliance, JOGMEC will fund 100% of expenditures up to $650,000 per year for a minimum of two years. Each of the parties will appoint two representatives to a Management Committee to oversee exploration activities with FPX Nickel acting as operator of the joint venture, earning a fee equal to 10% of the General Alliance expenditures.

One or more specific exploration targets identified by the Generative Alliance may be advanced to a second phase to be further developed as a separate designated project ("Designated Project"). Each Designated Project will have its own work program and budget with the objective, including through drilling, to test and further develop the identified targets. For each Designated Project, JOGMEC and the Company will fund 60% and 40%, respectively, for approved work programs.

If a Party's beneficial interest in a Designated Project is diluted to less than 10%, the diluted party's interest will be converted to 1.5% Net Smelter Return ("NSR") royalty over that Designated Project, with the other party retaining a right to buy-back 1.0% of the NSR royalty for $3,500,000.

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FPX NICKEL CORP.

Management's Discussion and Analysis

For the three months and year ended December 31, 2023

CO2 Lock Corp.

In September 2023, CO2 Lock Corp. ("CO2 Lock") completed its latest funding round, raising $1,097,000 through a Simple Agreement for Future Equity ("SAFE") from third-party investors. Proceeds of the SAFE will be used to conduct additional field work and sample collection at CO2 Lock's project site, Sam, located southwest of Prince George, utilizing ultramafic rocks and the mineral brucite for ex-situ carbon dioxide removal ("CDR") or for in-situ carbon dioxide storage and sequestration as part of a carbon capture and storage value chain.

During 2023, CO2 Lock advanced several technical programs to understand the key sub-surface parameters for future demonstration and pilot scale in-situ carbon dioxide mineralization programs. These programs included regional structural geology assessments and surficial terrain mapping and commencement of geophysics program to identify areas of higher porosity and permeability for groundwater flow.

In Q4 2023, CO2 Lock completed a comprehensive field program at its Sam site, including successful injection of CO2 at depth, with downhole sensors verifying the desired CO2 content throughout the carbonated water injection, and extraction of multi-tonne surface bulk sample for use in an ex-situ CO2 mineralization pilot at CO2 Lock's laboratory in Vancouver.

RESULTS OF OPERATIONS

Net Loss and Comprehensive Loss for the Three Months and Year ended December 31, 2023

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