The following Management's Discussion and Analysis of Financial Condition and Results of Operation ("MD&A") is intended to help the reader understand our financial condition. MD&A is provided as a supplement to, and should be read in conjunction with, our financial statements and the accompanying integral notes ("Notes") thereto. The following statements may be forward-looking in nature and actual results may differ materially.

Plan of Operation:

FORWARD LOOKING STATEMENTS: The following discussion may contain forward-looking statements that involve a number of risks and uncertainties. Factors that could cause actual results to differ materially include the following: inability to locate property with mineralization, lack of financing for exploration efforts, competition to acquire mining properties; risks inherent in the mining industry, and risk factors that are listed in the Company's reports and registration statements filed with the Securities and Exchange Commission.

The Company continued advancement of the South Mountain Project in 2022 with BeMetals Corp. - Vancouver B.C. (TSX-V: BMET) - under an option agreement to complete the pre-development work and produce a preliminary economic analysis (PEA). On December 30, 2022, Thunder Mountain Gold, Inc. by and through its subsidiaries Thunder Mountain Resources, Inc., a Nevada Corporation, and South Mountain Mines, Inc., an Idaho Corporation ("SMMI") (collectively the "Company", "THMG", or "We", "Our" or "Us") agreed to terminate the Option Agreement, (the "BeMetals Option Agreement") with BeMetals Corporation, a British Columbia corporation, and BeMetals USA Corporation, a Delaware corporation ("BeMetals BMET"). The Company's management has immediately commenced marketing the South Mountain Project to other groups that have expressed an interest. The Company's plan of operation for the next twelve months is to complete the South Mountain PEA on schedule and within budget.

Results of Operations:

In 2022, the Company recorded a net loss of $1,244,739, or $0.02 per share compared to a net loss of $571,796, or $0.01 per share for the same period of 2021. The increase in net loss was driven by a decreased of $500,000 in gain on mineral interests as a result of payments received pursuant to the terms of the BeMetals option agreement, for the year ending December 31, 2021. The Company also experienced an increase in legal and accounting expenses of $28,408 as well as an increase in management and administrative expenses of $201,862. The decrease in gain on mineral interest and increase in expenses was offset by a decrease in unrealized loss on investment recognized on the BeMetals stock when compared to the prior year.



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Fourth Quarter comparisons Total revenue for the quarter ending December 31, 2022 and 2021 was $75,000 in management services income. Total operating expenses for the three months ending December 31, 2022 of $107,939 increased from the same respective time period in 2021 by $5,619 or 5%. Legal and accounting costs decreased in three-month period ended December 31, 2022 compared to 2021 by $9,227 for a total of $7,388 compared to $16,615 for the same period last year. Management and administrative expense increased by $15,490 or 18% to $103,374, this increase relates to a $12,802 refund received from our workers compensation insurer in November of 2021. Depreciation expense remained consistent with the prior year.

Year end comparisons December 31,2022 vs 2021 Total revenues for the year ended December 31, 2022 decreased $500,000, or 63%, to $300,000 compared with $800,000 in the same period last year, While management service income remained consistent at $300,000 for both years, the gain on mineral interest decreased by $500,000 as a result of payments receive in 2021 pursuant to the terms of the Be Metals option agreement. The was no provision for additional or similar payments under the Option Agreement for 2022.

Total operating expenses for the period ending December 31, 2022 of $746,270 increased from the year ending December 31, 2021 by $219,288 or 42%. Exploration expenses decreased by $9,686 by 98% to $156 compared with $9,842 for the same period last year. This decrease is the result of expenditures related to Trout Creek and other potential mining projects. Legal and accounting costs increased $28,408 to $113,717, an increase of 33%, compared with $85,309 in the prior year. Management and administrative expenses increased by $201,862 or 47% principally due to stock compensation of $158,341, for stock options issued to our officers and director, on March 21, 2022, and Board of Directors compensation of $22,200. The Company did not recognize any stock compensation of in the year ending December 31, 2022. Depreciation expense continued to decrease as the Company's fixed assets are almost all fully depreciated.

Liquidity and Capital Resources:

The consolidated financial statements for the year ended December 31, 2022 have been prepared under the assumption that we will continue as a going concern. Such an assumption contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As shown in the consolidated financial statements for the year ended December 31, 2022, we have cash reserves and available for sale securities sufficient to cover normal operating expenditures for the following 12 months.

On December 30, 2022, Thunder Mountain Gold, Inc. by and through its subsidiaries Thunder Mountain Resources, Inc., a Nevada Corporation, and South Mountain Mines, Inc., an Idaho Corporation ("SMMI") (collectively the "Company", "THMG", or "We", "Our" or "Us") agreed to terminate an Option Agreement, (the "BeMetals Option Agreement") with BeMetals Corporation, a British Columbia corporation, and BeMetals USA Corporation, a Delaware corporation ("BeMetals BMET").

The "BeMetals Option Agreement was entered into on February 27, 2019, the original terms of the Option Agreement, BeMetals provided the funding to SMMI for project expenses including Management Services Income. The Company has 8 million common shares of BMET USA with a market value of $738,612, and the Company had cash and cash equivalents of $682,718 for the year ending December 31, 2022.

On July 19, 2021, management and certain Directors exercised options for 710,000 common shares at a price of $0.10 per share for total proceeds of $71,000 of which $35,534 was for cash and a $35,466 reduction in current liabilities related to advances from related parties for funds advanced by management and foregone wages.

On May 4, 2021, the Company sold 2,000,000 shares held in BeMetals Corp. for US $649,557 ($CAD 800,000). The shares of common stock were sold through Canaccord Genuity at a price of US $0.325 ($CAD 0.40). This sale meets the requirements under the terms of the BeMetals Option Agreement. The Company record a realized gain of $92,685, on the sale of BeMetals shares (see Footnote 4).



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The liquidity of the Company's additional sources of cash, or relief of demand for cash, includes additional external debt, the sale of shares of our stock, or alternative methods such as mergers or sale of our assets. The Company received 10,000,000 shares of BeMetals Corp. common stock in connection with the BeMetals Option Agreement. On May 17, 2021, the Company received US $649,557 from the sale of 2,000,000 shares of BeMetals common stock in an arranged transaction through Canaccord Genuity at a price of US $0.325 ($CAD 0.40) per share. Currently, there remains 8 million shares of BeMetals common stock being held at Canaccord Genuity that are available for sale.

Based upon current plans, Thunder Mountain Gold management is confident that the Company will have the financial strength and opportunities to meet its financial obligations for the next 12 months. Factors considered in substantiating this conclusion include:



   º On December 31, 2022, the Company had cash and cash equivalents of
     $682,718.
   º The Company has 8 million common shares of BMET USA with a market value of
     $738,612, on December 31, 2022.
   º The ability to raise additional equity capital based upon the results of
     the exploration and development conducted by BeMetals.

While there is much work to do, it is important to note, with the termination of BeMetals South Mountain Option Agreement. The Company's management has immediately commenced marketing the South Mountain Project to other groups that have expressed an interest.

We believe we have the ability to continue as a going concern, even though our total accumulated deficit of $6,351,381 as of December 31, 2022. Our plans for the long-term continuation as a going concern include financing our future operations through sales of our common stock and/or debt and the eventual profitable exploitation of our mining properties. The Company does have the option of selling BeMetals common stock shares. If we are not successful with our plans, equity holders could then lose all or a substantial portion of their investment.

At December 31, 2022, we have current assets of $1,441,443. For the year ended December 31, 2022, net cash used for operating activities was $402,136. Our future liquidity and capital requirements will depend on many factors, including timing, cost and progress of our exploration efforts, our evaluation of, and decisions with respect to, our strategic alternatives, and costs associated with the regulatory approvals. If it turns out that we do not have enough cash to complete our exploration programs, we will make every effort to raise additional funds from public offerings, sale of liquid stock or loans.



   º On March 6, 2023, we had $555,381 cash in our bank accounts.
   º We do not include in this consideration any option payments mentioned
     below.
   º Management is committed to managing expenses of all types to not exceed the
     on-hand cash resources of the Company at any point in time, now or in the
     future.
   º The Company will also consider other sources of funding, including
     potential mergers, the sale of all or part of the Company`s BeMetals Corp.
     (TSX-V: BMET) common shares beneficially held, and/or additional farm-out
     of its other exploration property.

For the year ended December 31, 2022, the Company reports net cash used by operating activities of $402,136 compared to cash used by operating activities of $257,816 in 2021. During the year ended December 31, 2022, net cash used by financing activities was $71,768, which included $66,768 in payments on related notes payables, and $5,000 to non-controlling interest. The Company reported a net cash decrease of $473,904 for the year ended December 31, 2022, compared to a net cash increase of $882,467 for the same period in 2021.

Our future liquidity and capital requirements will depend on many factors, including timing, cost and progress of our exploration efforts, our evaluation of, and decisions with respect to, our strategic alternatives, and costs associated with the regulatory approvals. If it turns out that we do not have enough cash to complete our exploration programs, we will attempt to raise additional funds from a public offering, a private placement, mergers, farm-outs or loans.



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Additional financing will be required in the future to fund our planned operations. We do not know whether additional financing will be available when needed or on acceptable terms, if at all. If we are unable to raise additional financing, when necessary, we may have to delay our exploration efforts or any property acquisitions or be forced to cease operations. Collaborative arrangements may require us to relinquish our rights to certain of our mining claims.

Contractual Obligations

During 2008 and 2009, three lease arrangements were made with landowners that own land parcels adjacent to the Company's South Mountain patented and unpatented mining claims. The leases were for a seven-year period, with options to renew, with annual payments (based on $20 per acre) listed in the following table. The leases have no work requirements.



Contractual obligations                     Payments due by period
                         Total*  Less than 1 year 2-3 years 4-5 years More than 5 years
Acree Lease (yearly,      $3,390           $3,390         -         -        $        -

June)(1)


Lowry Lease (yearly,     $11,280          $11,280         -         -        $        -
October)(1)(2)
OGT LLC(3)               $15,000           $5,000   $10,000         -        $        -
      Total              $29,670          $19,670   $10,000         -        $        -


(1) Amounts shown are for the lease periods years 15 through 16, a total of 2
years that remains after 2021, the lease was extended an additional 10 years at
$30/acre after 2014.
(2) The Lowry lease has an early buy-out provision for 50% of the remaining
amounts owed in the event the Company desires to drop the lease prior to the end
of the first seven-year period.
(3) OGT LLC, managed by the Company's wholly owned subsidiary SMMI, receives a
$5,000 per year payment for up to 10 years, or until a $5 million capped NPI
Royalty is paid.

Critical Accounting Policies

We have identified our critical accounting policies, the application of which may materially affect the financial statements, either because of the significance of the financials statement item to which they relate, or because they require management's judgment in making estimates and assumptions in measuring, at a specific point in time, events which will be settled in the future. The critical accounting policies, judgments and estimates which management believes have the most significant effect on the financial statements are set forth below:

a) Estimates. Our management routinely makes judgments and estimates about the effect of matters that are inherently uncertain. As the number of variables and assumptions affecting the future resolution of the uncertainties increase, these judgments become even more subjective and complex. Although we believe that our estimates and assumptions are reasonable, actual results may differ significantly from these estimates. Changes in estimates and assumptions based upon actual results may have a material impact on our results of operation and/or financial condition.

b) Stock-based Compensation. The Company records stock-based compensation in accordance with ASC 718, "Compensation - Stock Compensation" using the fair value method. All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable.

c) Income Taxes. We have current income tax assets recorded in our financial statements that are based on our estimates relating to federal and state income tax benefits. Our judgments regarding federal and state income tax rates, items that may or may not be deductible for income tax purposes and income tax regulations themselves are critical to the Company's financial statement income tax items.

d) Investments. In a joint venture where the Company holds more than 50% of the voting interest and has significant influence, the joint venture is consolidated with the presentation of non-controlling interest. In determining whether significant influences exist, the Company considers its participation in policy-making decisions and its representation on the venture's management committee.



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