Patagonia Gold : Q1 2023 Management’s Discussion and Analysis

PATAGONIA GOLD CORP.

MANAGEMENT'S DISCUSSION AND ANALYSIS

For the three months ended March 31, 2023

May 29, 2023

The following management's discussion and analysis ("MD&A") of Patagonia Gold Corp. (hereinafter referred to as the "Company" or "Patagonia"), formerly Hunt Mining Corp. ("Hunt") and its subsidiaries provides an analysis of the operating and financial results for the three months ended March 31, 2023 and a comparison of the material changes in our results of operations between the three months ended March 31, 2022 and financial condition between the year ended December 31, 2022. This MD&A should be read in conjunction with the Corporation's unaudited condensed interim consolidated financial statements ("interim financial statements") for the three months ended March 31, 2023, annual audited consolidated financial statements for the year ended December 31, 2022 and related MD&A.

These statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB"). This MD&A includes certain non-IFRS financial performance measures. For a detailed description of these measures, please see "Non-IFRS Financial Performance Measures" section. The amounts presented in this MD&A are in thousands ($'000) of U.S. dollars, except share, per share, per unit amounts and unless otherwise noted.

The Company's head office and principal business address is Av. Libertador 498 Piso 26, Buenos Aires, Argentina, C1001ABR and the registered office address is 2200 HSBC Building, 885 West Georgia Street, Vancouver, British Columbia, V6C 3E8. The Company's common shares trade on the TSX Venture Exchange (the "Exchange"), under the symbol PGDC. Additional information relevant to the Company's activities can be found on their website at http://patagoniagold.com, on SEDAR at www.sedar.com.

Management's Responsibility for Financial Reporting

The interim financial statements have been prepared by management in accordance with IFRS and have been approved by the Company's board of directors (the "Board"). The integrity and objectivity of the financial statements are the responsibility of management. In addition, management is responsible for ensuring that the information contained in the MD&A is consistent where appropriate, with the information contained in the interim financial statements.

The interim financial statements may contain certain amounts based on estimates and judgments. Management has determined such amounts on a reasonable basis to ensure that the interim financial statements are presented fairly in all material respects.

As the Company is a Venture Issuer (as defined under under National Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings) ("NI 52-109"),the Company and management are not required to include representations relating to the evaluation, design, establishment and/or maintenance of disclosure controls and procedures ("DC&P") and/or Internal Controls over Financial Reporting ("ICFR"), as defined in NI 52-109,nor has it completed such an evaluation. Inherent limitations on the ability of the certifying officers to design and implement on a cost-effectivebasis DC&P and ICFR for the issuer may result in additional risks of quality, reliability, transparency and timeliness of interim and annual filings and other reports provided under securities legislation.

Cautionary Note on Forward-Looking Information

This MD&A contains "forward-looking information" and "forward-looking statements" within the meaning of applicable securities laws of Canada (collectively referred to as "forward-looking information") which relate to future events or the Company's future performance and may include, but are not limited to, statements about strategic plans, spending commitments, future operations, results of exploration, anticipated financial results, future work programs, capital expenditures and expected working capital requirements. Often, but not always, forward-looking information can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "continues", "forecasts", "projects", "predicts", "intends", "anticipates" or "believes", or variations of, or the negatives of, such words and phrases, or state that certain actions, events or results "may", "could", "would", "should", "might" or "will" be taken, occur or be achieved.

Readers are cautioned not to place undue reliance on forward looking information and there can be no assurance that forward looking information will prove to be accurate as the Company's actual results, performance or achievements may differ materially from any future results, performance or achievements expressed or implied by such forward-looking information if known or unknown risks, uncertainties or other factors affect the Company's business, or if the Company's estimates or assumptions prove inaccurate. Therefore,

- 1 -

the Company cannot provide any assurance that forward-looking information will materialize. Factors that could cause results or events to differ materially from current expectations expressed or implied by the forward-looking information, include, but are not limited to: fluctuations in the currency markets (such as the Canadian Dollar, Chilean Peso, Great Britain Pound and the United States Dollar); changes in national and local government, legislation, taxation, controls, regulations and political or economic developments in Canada and Argentina or other countries in which the Company may carry on business in the future; operating or technical difficulties in connection with exploration and development activities; risks and hazards associated with the business of mineral exploration and development (including environmental hazards or industrial accidents); risks relating to the credit worthiness or financial condition of suppliers and other parties with whom the Company does business; the presence of laws and regulations that may impose restrictions on mining, including those currently enacted in Argentina; employee relations; relationships with and claims by local communities; availability and increasing costs associated with operational inputs and labour; the speculative nature of mineral exploration and development, including the risks of obtaining necessary licenses, permits and approvals from government authorities; business opportunities that may be presented to, or pursued by, the Company; challenges to, or difficulty in maintaining, the Company's title to properties; risks relating to the Company's ability to raise funds; and the factors identified under "Risk Factors" in this MD&A.

The forward looking information contained in this MD&A are based upon assumptions management believes to be reasonable including, without limitation: financing will be available for future exploration, development and operating activities; the actual results of the Company's development and exploration activities will be favourable or at least consistent with management's expectations; operating, development and exploration costs will not exceed management's expectations; all requisite regulatory and governmental approvals for development projects and other operations will be received on a timely basis upon terms acceptable to the Company, and applicable political and economic conditions will be favourable to the Company such as the continuing support for mining by local governments in Argentina; the price of gold and/or other applicable metals and applicable interest and exchange rates will be favourable to the Company or at least consistent with management's expectations; no title disputes will exist with respect to the Company's properties; debt and equity markets and other applicable economic conditions will be favourable to the Company; the availability of equipment and qualified personnel to advance exploration projects and; the execution of the Company's existing plans and further exploration and development programs for its projects, which may change due to changes in the views of the Company or if new information arises which makes it prudent to change such plans or programs.

All forward-looking-information contained in this MD&A is given as of the date hereof and is based upon the opinions and estimates of management and information available to management as at the date hereof. The Company disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.

The Company

On July 24, 2019, the Company and Patagonia Gold Limited ("PGL") [formerly Patagonia Gold PLC ("PGP")] completed a reverse acquisition (or reverse takeover, the "RTO") resulting in Hunt acquiring all issued shares of common stock of PGP in exchange for common shares of Hunt on the basis of 10.76 Hunt shares for each PGP share. Hunt issued 254,355,192 common shares to the shareholders of PGP representing an ownership interest of approximately 80%. The operating name of Hunt Mining Corp. was changed to Patagonia Gold Corp.

Patagonia is a mineral exploration and production Company incorporated on January 10, 2006 under the laws of Alberta, Canada and, together with its subsidiaries, is engaged in the exploration of mineral properties and exploitation of mineral resources and mineral reserves in the Santa Cruz, Rio Negro and Chubut Provinces of Argentina.

- 2 -

The interim financial statements are presented on a consolidated basis and include the accounts of the Company, its wholly owned and majority owned subsidiary:

		Percentage	Functional
Corporation	Incorporation	ownership	currency	Business purpose
Patagonia Gold S.A. ("PGSA")	Argentina	95	US$	Production and Exploration Stage
Minera Minamalu S.A.	Argentina	100	US$	Exploration Stage
Huemules S.A.	Argentina	100	US$	Exploration Stage
Leleque Exploración S.A.	Argentina	100	US$	Exploration Stage
Patagonia Gold Limited (formerly
Patagonia Gold PLC)	UK	100	GBP$	Holding
Minera Calcatreu S.A.U. (formerly
Minera Aquiline S.A.U.)	Argentina	100	US$	Exploration Stage
Patagonia Gold Canada Inc.	Canada	100	CAD$	Holding
Patagonia Gold Chile S.C.M.	Chile	100	CH$	Exploration Stage
Ganadera Patagonia S.R.L.	Argentina	100	US$	Land Holding
1272680 B.C. Ltd (formerly 1494716
Alberta Ltd.)	Canada	100	CAD$	Nominee Shareholder

The Company's activities include the exploration for and production of minerals from properties in Argentina. On the basis of information to date, properties where it has not yet been determined if economically recoverable reserves exist are classified as exploration-stage. Properties where economically recoverable reserves exist and are being exploited are classified as production-stage. The underlying value of the mineral properties is entirely dependent upon the existence of reserves, the ability of the Company to obtain the necessary financing to complete development and upon future profitable production or a sale of these properties.

On some properties, ongoing production and sales of gold and silver are being undertaken without established mineral resources or reserves and the Company has not established the economic viability of the operations. As a result, there is increased uncertainty and economic risks of failure associated with these production activities. Despite the sale of gold and silver, these projects remain in the exploration stage because management has not established proven or probable reserves required to be classified in either the development or production stage.

Summary of Consolidated Results of Operations ($'000's)

(in $000's, except ounces and per share amounts)				Three months ended March 31,
		2023		2022		Change	%Change
Operational results
Total gold equivalent ounces - produced (1)		1,304		1,805		(501)	(28%)
Total gold equivalent ounces - sold (1)		1,598		2,219		(621)	(28%)
Financial results
Revenue	$	3,046	$	4,185	$	(1,139)	(27%)
Cost of sales	$	3,693	$	3,968	$	(275)	(7%)
Exploration expenses	$	1,165	$	1,937	$	(772)	(40%)
Repair and maintenance	$	169	$	170	$	(1)	(1%)
Depreciation, depletion and amortization	$	172	$	628	$	(456)	(73%)
Administrative expenses	$	1,157	$	1,091	$	66	6%
Interest expense	$	584	$	658	$	(74)	(11%)
Other income	$	1,928	$	783	$	1,145	146%
Net income (loss)	$	(2,619)	$	(3,143)	$	524	17%
Net income (loss) per share - basic and diluted	$	(0.006)	$	(0.007)	$	0.001	14%

1. Gold equivalent ounces include silver ounces produced and sold converted to a gold equivalent based on a ratio of the average spot market price for the commodities each period. The ratio for three months ended March 31, 2023 was 82.74:1 (2022 - 78.15:1).
2. • 3 -

Three months ended March 31, 2023 and 2022

Total production decreased during the three months ended March 31, 2023 as the Company had residual heap leach operations at Lomada de Leiva ("Lomada") and Cap-Oeste since February 2019, which has been declining due to the depletion in the pads from ongoing leaching. Additional material being placed on the pads has not offset the overall declining production quarter over quarter. Sources for new fresh material to increase the production are being sought.

The Company earned total revenue of $3,046 during the three months ended March 31, 2023 compared to $4,185 during the same period in 2022. Revenue decreased due to the lower gold equivalent ounces produced and sold during the period compared to the same period in 2022.

Cost of sales were $3,693 during the three months ended March 31, 2023 compared to $3,968 during the same period in 2022. Cost of sales decreased due to overall decrease in gold equivalent ounces produced and sold. Also, during the three months ended March 31, 2023, the net realizable value of the inventory was less than the costs incurred in establishing the gold held on carbon and the Company recorded an inventory write down of $562 (2022 - $149) under cost of sales.

The Company incurred exploration expenses of $1,165 during the three months ended March 31, 2023 compared to $1,937 during the same period in 2022. The decrease in exploration expenses is related to overall less exploration activities for period compared to prior period.

The Company incurred repair and maintenance expense of $169 during the three months ended March 31, 2023 compared to $170 during the same period in 2022. The repair and maintenance expense during the period related to routine maintenance work at the Mina Martha Plant.

The Company incurred administrative expenses of $1,157 during the three months ended March 31, 2023 compared to $1,091 during the same period in 2022. The increase in administrative expenses was due to higher inflation in Argentina which was partially offset by the devaluation of the Argentinian peso.

The Company incurred depreciation, depletion and amortization expenses of $172 during the three months ended March 31, 2023 compared to $628 during the same period in 2022. The decrease in depreciation, depletion and amortization expenses was due to the decrease in production and as a result of the Lomada mineral property being fully depleted in 2021 and the addition for the three months ended March 31, 2022 was fully depleted.

The Company incurred interest expense of $584 during the three months ended March 31, 2023 compared to $658 during the same period in 2022. The decrease in interest expense was due to repayment of bank indebtedness with Argentinian banks.

As part of the Company´s treasury management, the Company trades certain securities denominated in US dollar and Argentine Peso. The Company recognized a gain on disposition of these securities of $1,928 during the three months ended March 31, 2023 compared to $783 during the same period in 2022.

Net loss for the three months ended March 31, 2023 was $2,619 compared to net loss of $3,143 during the same period in 2022. Net loss decreased due to the gain on disposition of certain securities and due to the decrease in exploration expenses partially offset by the decrease in revenues.

Cash flows for the three months ended March 31, 2023 and 2022 ($'000's)

The Company used $2,012 of cash in operating activities for the three months ended March 31, 2023 compared to cash generated of $202 during the same period in 2022. The increase in cash used in operating activities during 2023 was primarily due to a larger decrease in accounts payable and accrued liabilities compare to 2022.

Cash used in investing activities for the three months ended March 31, 2023 was $152 compared to $87 for the same period in 2022. The increase in cash used in investing activities was a result of higher additions to purchases of property and equipment.

Cash generated from financing activities for the three months ended March 31, 2023 was $2,333 compared to $519 during the same period in 2022. The increase in cash generated from financing activities was primarily due to funds received from the Cantomi loan.

- 4 -

Financial Position ($'000's)

Cash

The Company has cash on hand of $587 as of March 31, 2023 compared to $231 as of December 31, 2022.

Receivables

Current receivables are $1,560 as of March 31, 2023 compared to $2,021 as of December 31, 2022. The decrease in current receivables is a result of a collection of VAT recoverable during the three months ended March 31, 2023.

Non-current receivables are $1,605 as of March 31, 2023 compared to $1,671 as of December 31, 2022. The decrease in non-current receivables is a result of the decrease in VAT recoverable during the three months ended March 31, 2023.

Inventories

The Company has inventories of $4,345 as of March 31, 2023 compared to $4,653 as of December 31, 2022. The decrease in inventories was mainly due to higher write-off of inventory as at March 31, 2023. During the three months ended March 31, 2023, the net realizable value of the inventory was less than the costs incurred in establishing the gold held on carbon and the Company recorded an inventory write down of $562 (2022 - $149).

Property, plant and equipment ("PPE")

The Company has PPE of $10,328 as of March 31, 2023 compared to $10,644 as of December 31, 2022. The decrease in PPE was a result of the depreciation charge which was partially offset by capital additions.

Bank indebtedness

The Company has bank indebtedness of $9,081 as of March 31, 2023 compared to $8,945 as of December 31, 2022. The increase in bank indebtedness was a result the interest expenses from lines of credit.

Accounts payable and accrued liabilities

The Company has accounts payable and accrued liabilities of $4,486 as of March 31, 2023 compared to $5,953 as of December 31, 2022. The decrease in accounts payable and accrued liabilities was a result of paying down accounts payables and normal fluctuations in operations.

Accounts payable with related parties

The Company has accounts payable with related parties of $251 as of March 31, 2023 compared to $285 as of December 31, 2022. The decrease in accounts payable with related parties is a result of lower remuneration, fees and interest expenses incurred during the period.

Current portion of long-term debt

The Company has current portion of long-term debt of $283 as of March 31, 2023 compared to $386 as of December 31, 2022. The decrease in loan payable and current portion of long-term debt is due to repayment of loan payable during the three months ended March 31, 2023.

Long term debt

The Company has non-current portion of total long-term debt of $22,670 as of March 31, 2023 compared to $20,019 as of December 31, 2022. The increase in long-term debt is due to increase in loans to fund operations and an increase in accrued interest.

- 5 -