Three Valley Copper : TVC June 30, 2022 MD&A

Three Valley Copper Corp.

Management's Discussion and Analysis

of Financial Position and Results of Operations

Second Quarter Ended June 30, 2022

MANAGEMENT'S DISCUSSION AND ANALYSIS

The following is management's discussion and analysis ("MD&A") of the financial condition, cash flows and future prospects of Three Valley Copper Corp. ("TVC" or the "Company"). This document is prepared as at August 25, 2022 (unless otherwise stated) and should be read in conjunction with the Company's unaudited condensed interim consolidated financial statements for the three and six months ended June 30, 2022, including the notes thereon (the "Financial Statements"), the Company's audited consolidated financial statements for the year ended December 31, 2021, including the notes thereon and the Company's MD&A for the year ended December 31, 2021. The Company prepares its Financial Statements in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB"). All amounts are expressed in United States dollars ("USD") unless otherwise indicated. Additional information on the Company and its operations, including a consolidated National Instrument 43-101 Standards of Disclosure for Mineral Projects ("NI 43-101") compliant technical report on the Minera Tres Valles project (the "Technical Report"), can be accessed at www.sedar.com, and may also be found on the Company's website at www.threevalleycopper.com

Forward-looking statements and information are used throughout this document. See the Forward-Looking Information section at the end of this document highlighting the caution that a reader should place on all forward-looking information.

BUSINESS OVERVIEW

Three Valley Copper Corp. (formerly SRHI Inc.) headquartered in Toronto, Ontario, Canada is listed on the TSX Venture Exchange ("TSXV") and OTCQB Venture Market ("OTC") and is focused on its primary asset, Minera Tres Valles SpA ("MTV"). Located in Salamanca, in the Province of Choapa, Chile, MTV is 95.1% owned by the Company and MTV's main assets are the Minera Tres Valles mining complex and its 46,000 hectares of exploratory lands.

MTV was acquired in October 2017 and includes a fully integrated processing operation and two mines the Don Gabriel open pit mine ("Don Gabriel") and the Papomono underground mine ("Papomono"). Both mines are located approximately 10 kilometers north of the town of Salamanca, 300 kilometers north of Santiago, Chile.

In December 2020, MTV restarted mining operations after being idled since February 2020 as it went through a Judicial Reorganization Agreement ("JRA") with its key creditors. The senior secured prepayment facility (the "Facility") previously entered into with the MTV senior secured lenders (the "Lenders"), was later amended as part of the JRA (the "Amended Facility").

MTV's intended objective is to carry out mining activities associated with exploiting and processing minerals for which it has a crushing and processing plant with nameplate capacity of 7,000 tonnes per day. MTV's heap leach pads and solvent-extraction and electrowinning processing ("SX-EW") plant (production capacity of 18,500 tonnes per year of copper cathodes) are located near Salamanca. In addition to the two mines, MTV owns a large regional land package which has not been extensively explored for minerals, primarily copper.

Additional information on the Company and its operations, including its Technical Report, can be found on the Company's website at www.threevalleycopper.comand on SEDAR at www.sedar.com.

SECOND QUARTER HIGHLIGHTS

On June 13, 2022, MTV commenced a second reorganization proceeding by filing a Judicial Restructuring Procedure ("JRP") in Chile to seek protection from creditors to give MTV a further opportunity to seek a long-term financing solution to ensure MTV's continuity of operations. This is similar to filing for creditor protection under the Companies' Creditors Arrangement Act in Canada. The initial court order sought is expected to provide a stay of creditor claims and the exercise of contractual rights providing the necessary protection to allow MTV to continue its focus on sourcing a long-term financial partner that will encourage its creditors to restructure their debts leading to a secure financial foundation to grow MTV's business.

Simultaneously with the filing of the JRP, MTV ceased all mining operations, demobilized contractors, halted all processing of ore from third- party miners and terminated the majority of its mining related employees. This care and maintenance program has resulted in the termination of over 50% of its employee base and further planned terminations are expected in the next 4 to 6 weeks that will ultimately result in 15 remaining employees to operate the plant and other necessary functions should interim capital support for MTV not be obtained. Since June

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13, 2022, MTV is producing copper cathode solely from the remaining ore inventory on its leach pads which is expected to be exhausted in September 2022.

To date, the Lenders have not reached agreement between themselves to further support MTV in the future nor has longer-term capital been sourced. MTV has limited cash resources that are now expected to expire before the end of September 2022. MTV has been successful in extending its cash resources by producing copper cathodes from its existing current inventory and withholding payments to certain suppliers. The Company and MTV continue to have discussions with the Lenders to source an interim capital support solution for the remainder of 2022 to allow MTV additional time to attract long-term investment. To date, the Lenders have not provided a fulsome solution to support MTV in the interim and it is expected that MTV will not have sufficient funds to operate past September 2022.

In July 2022, MTV was notified that there was a procedural delay in granting the court order. To date, the courts have neither granted nor denied MTV's application for creditors protection. The Company and MTV have been informed that the prolonged delay pertains to procedural matters likely resulting from the the lack of precedent in Chile for granting companies a second JRP. MTV was granted its first creditors protection in 2020. If the initial court order is not granted, it is expected that MTV could be forced to liquidate or be sold, which could adversely impact TVC's ability to recover any or all of the Company's investment in MTV. TVC is expected to continue as a going concern even if a liquidation event occurs at MTV. If MTV is successful in restructuring its existing debt and in sourcing additional financing, there will likely be a material dilution to TVC's ownership interest in MTV, including the possibility that TVC would no longer hold majority control of MTV.

Filing for a JRP is an event of default under the Amended Facility. MTV did not pay amounts due to the Lenders since March 31, 2022, as required pursuant to the terms of the Amended Facility. As a result of the current financial situation of MTV, certain defaults of the Amended Facility have occurred and are continuing. While the Lenders have not sent a notice of default to MTV, they have expressly reserved their rights. Consequently the total outstanding balance of the Amended Facility remains classified as current liabilities. In addition, the amounts owing to the unsecured creditors (the "Unsecured Creditors") of the JRA are also classified as current liabilities. The amounts due to the Unsecured Creditors of the JRA on March 31, 2022 were postponed until June 30, 2022 and further postponed until August 31, 2022 with the approval of the Creditors' Committee representing the Unsecured Creditors of the JRA.

Copper cathode production in the second quarter of 2022 was 1.7 million pounds coming primarily from the drawdown of current inventory on the leach pads and ore supplied by third-party miners prior to June 13, 2022. Copper cathode production at MTV was negatively impacted by minimal production from the ramp-up of the Papamono block caving operations which started on March 7, 2022 and ceased on June 13, 2022, when Papomono was placed in care and maintenance; and halting all deliveries of ore from third-party miners effective June 13, 2022. Copper cathode production for the six months ended June 30, 2022 was 4.0 million pounds.

Revenue for the second quarter of 2022 was $8.2 million from the sale of 1.9 million pounds of copper cathodes at an average realized copper price (see Non-IFRS Performance Measures elsewhere in this MD&A) of $4.31 per pound; bringing total revenue for the six months ended June 30, 2022 to $19.0 million from the sale of 4.3 million pounds of copper cathodes at an average realized copper price of $4.38 per pound.

Net loss for the second quarter of 2022 was $5.4 million or $0.05 on a per-share basis, and for the for the six months ended June 30, 2022 was $12.6 million, or $0.11 on a per-share basis.

Cash and cash equivalents and restricted cash at the end of the period was $7.2 million with the majority of this amount held directly by TVC which is separate from MTV.

OUTLOOK

Outlook

Going Concern Assumption

The Company is subject to numerous risk factors that may impact MTV's ability to economically produce copper cathodes, such as, but not limited to, current volatile market conditions and extended and potential startup issues with Papomono and the impact of the fixed portion of the offtake arrangement (the "Offtake") with MTV's principal buyer of copper cathodes. MTV has incurred significant operating losses and negative cash flows from operations in recent years. MTV will require further financing to meet its financial obligations, sustain its operations and ongoing capital projects in the normal course and expand its inventory of reserves and resources.

MTV currently operates in a high-cost environment and additional sources of capital will be required to execute MTV's planned operations. Such capital investments will depend on a number of unpredictable factors, which are often beyond the control of the Company and MTV. MTV's ability to meet its long-term business strategy depends on its ability to obtain additional financing in the immediate term and to

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generate operational cash flow from its commercial revenues. A key milestone for MTV's future success is the restart and ramp-up of production from the Papomono mine, the initial construction of which was completed in January 2022. Management estimates that additional sustaining capital requirements and working capital will be required in 2022 prior to a restart of mining operations. The Papomono mine ramp-up and its future production of copper ore depends on several factors some of which may be out of MTV's and/or the Company's control.

There is no assurance that additional financing will be available on a timely basis or on terms acceptable to MTV. MTV has suspended mining operations at the Don Gabriel open pit mine and Papomono underground mine, and is in negotiations with the Lenders to amend the terms of the Amended Facility. There is no assurance that the negotiations with the Lenders will be successful. If MTV is successful in sourcing additional financing, this will likely cause a material dilution to TVC's ownership interest in MTV, including the possibility that TVC would no longer hold majority control of MTV. MTV did not pay amounts due to the Lenders since March 31, 2022, and consequently effective March 31, 2022, MTV is in default with the terms of the Amended Facility. In addition, TVC did not invest the remaining net proceeds of the November 2021 financing (approximately $2.5 million) into MTV pursuant to the terms of the undertaking agreement (the "Undertaking") with the Lenders, and consequently the terms of the undertaking agreement are now no longer binding. The remaining net proceeds of the November 2021 financing intended to support MTV are currently being retained by TVC which may be used in whole, or in part, to further support MTV in the future, subject to the outcome of the negotiations underway with the Lenders. Due to certain ongoing events of default, the Lenders may exercise their security rights and/or remedies pursuant to the terms of the Amended Facility that could force a liquidation or sale of MTV that could adversely impact the TVC's ability to recover any or all of TVC's investment in MTV. The public company, TVC, is expected to continue as a going concern even if a liquidation event occurs at MTV.

As a result of MTV's current financial situation and the interruption in its operations, certain defaults of the Amended Facility have occurred and are continuing, consequently the total outstanding amounts due under the Amended Facility are classified as current liabilities. In addition, the amounts due to the Unsecured Creditors under the terms of the JRA are classified as current liabilities. On June 13, 2022, MTV determined that it was in its best interests to file for an application for creditor protection under the JRP. To date MTV has not received formal approval of its reorganization application under the JRP. Currently, MTV is processing ore that was on its leach pads prior to suspension of mining activities. It is expected that the current inventory ores will be exhausted in September 2022 and long-term inventory will not be processed until further capital investment is obtained by MTV to process the long-term inventory on its leach pads.

These circumstances result in material uncertainties that cast significant doubt upon MTV's ability to continue as a going concern, and the ultimate appropriateness of the use of accounting principles applicable to a going concern. The Financial Statements do not reflect the adjustments to the carrying values of assets and liabilities, the reported revenues and expenses, and the balance sheet classifications used, that would be necessary if MTV were unable to achieve profitable operations or to obtain adequate financing or successfully renegotiate the terms of the Amended Facility. These adjustments would likely be material.

Expansion Projects and Production

Cathode production is expected to continue for a further 4 to 6 weeks, absent any interim capital support for MTV, and is to come primarily from the existing inventory on the leach pad. A large component of future ore production growth, subject to longer-term capital support, is expected to come from the higher-grade Papomono deposit.

The Company has plans to complete the development of Papomono subject to MTV receiving the necessary capital that to date remains uncommitted. The initial construction of Papomono was completed in January 2022, when it reached the stage where the caving operation could commence. This timetable was consistent with what the Company reported previously and construction costs were in line with forecasted costs.

The expansion of Don Gabriel began in the second half of 2018 supported by the Company's working capital and MTV's operational cash flows. In the first quarter of 2020, the expansion of Don Gabriel was halted. Mining restarted in December 2020 and was initially expected to continue until early 2023. However, the continuing underperformance of Don Gabriel in 2021 prompted MTV to temporarily suspend operations at Don Gabriel on January 24, 2022. Continued expansion of Don Gabriel remains part of the longer life of mine plan assuming further technical work and review conclude Don Gabriel is economically viable. Earlier this year, a preliminary technical assessment of Don Gabriel was initiated by an independent external consulting group but has now been suspended pending future capital support of MTV. Subject to the results of the assessment, MTV expects that additional drilling and technical work will be needed that may result in a new resource model, new reserve estimate and an updated mine plan for Don Gabriel prior to re-starting mining operations in 2024/2025 as is currently planned. The Company cannot at this time confirm if the existing Technical Report can still be relied upon with respect to Don Gabriel and will provide further guidance on this when more information is available. For planning purposes, MTV has reduced its expected recoverable ore from Don Gabriel until additional analysis of Don Gabriel is complete.

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In January 2022, construction and development of the initial phase of Papomono was completed and it was ready to commence the block caving operation. However, MTV decided to temporarily halt the start of the block caving operation at that time. On March 7, 2022, the Company, with the support of the Lenders and the underground mining contractor, decided to start the operations of the Papomono block caving mine while discussions with the Lenders to find a comprehensive solution to MTV's cash flow shortfall continued. As part of the decision process to start the block caving operation and at the request of the Lenders, MTV engaged consultants to undertake a technical optimization study in respect of Papomono. Phase one of this study was completed and it supported the decision to start the operations of the Papomono block caving mine, which is expected to ultimately generate underground production in excess of 2,000 tonnes per day while significantly reducing unit-mining costs. On June 13, 2022, Papomono was placed on care and maintenance, following MTV's decision to commence the reorganization proceedings by filing a JRP in Chile.

Subject to receiving the necessary capital support, the restart of Papomono is expected to resume in the first half of 2023.

Under the Offtake with Anglo American Marketing Limited ("AAML"), MTV has contracted to sell a fixed amount of copper cathode representing 40% of its expected copper cathode production at $2.89 per pound from August 2020 to July 2022 (the "Fixed Price"). The volume of monthly copper cathode contracted to sell at $2.89 per pound was set in July 2020 based on expected production from August 2020 to July 2022 with 3,382 tonnes remaining as at June 30, 2022. In the event that monthly copper cathode production is in excess of the expected volume, less than 40% of copper produced in that month will be sold at $2.89 per pound. In the event that monthly copper cathode production is below the expected volume, greater than 40% of copper produced in that month will be sold at $2.89 per pound.

Effective August 1, 2021, MTV executed an amendment to the Offtake specific to the Fixed Price sales component with AAML. Under the terms of the amendment, the remaining monthly deliveries of copper cathode due under the Fixed Price portion of the Offtake were deferred until May 1, 2022 and all sales of copper cathode commencing August 1, 2021 until April 30, 2022 were sold at the prevailing spot price for copper cathode, less a nominal amount. The remaining 12 months of contracted delivery amounts of the Fixed Price portion of the contract were expected to resume on May 1, 2022 at the previous agreed Fixed Price of $2.89 per pound when copper cathode production was expected to include contributions from Papomono. To date, the Fixed Price portion of the Offtake has not restarted and is being reconsidered as part of the current negotiation underway with the Lenders.

During the first and second quarters of 2022, 100% of copper cathodes produced by MTV was sold at the prevailing spot price for copper cathode, less a nominal amount, as a result of the amendment to the Offtake and the ongoing negotiations with the Lenders.

In 2022, third-party small miner ore supplied was higher than expected until all deliveries of ore from third-party miners were halted on June 13, 2022 when MTV initiated a full care and maintenance program. The higher than expected supply of third-party small miners ore was mainly due to the amendment to the Offtake specific to the Fixed Price sales component as it allowed MTV to purchase ore from third- party miners at more competitive rates.

COVID-19

At the onset of the COVID-19 outbreak, the virus created near-term copper price uncertainty and volatility, and significant losses across the world's financial marketplace and social dislocation. Since March 23, 2020 when the copper price reached a low of $2.10 per pound, it rallied considerably to a high monthly average of $4.64 per pound in March 2022. Copper prices averaged $3.41 per pound in July 2022. MTV remains confident in the long-term outlook for copper, however global economic uncertainty and the unknown effects of COVID-19 could lead to volatility of copper prices in the coming quarters. The extent and duration of impacts that the pandemic may still have on the copper price, suppliers and employees and on global financial markets is not known at this time, and could be material.

MTV initiated an on-site vaccination program by offering vaccinations to all MTV employees and contractors. As at July 31, 2022, 100% of MTV employees received both doses of the vaccine and approximately 93% received the booster dose. MTV continues its preventative, mitigating and containment measures to actively minimize the spread of COVID-19.

COVID-19 restrictions continued to ease in Chile since the second half of 2021 as cases trended downward, resulting in little impact on the MTV's operations during the first half of 2022. Should these restrictions reappear in the future, the effect of the COVID-19 pandemic on the MTV's business activities will create elevated uncertainty and may further impact copper cathode production.

Geopolitical Uncertainties

In October 2019, social unrest in Chile erupted throughout the country. Deaths, vandalism and looting were reported in Santiago and other regions of the country. During 2021, the social unrest retreated as COVID-19 became the focus of the country but its impacts on Chile's economy continue. As a result, Chile started a process to replace its Constitution by means of a Constitutional Assembly tasked with drafting the new text. The elections of the members of the Assembly resulted in resounding victories for leftist and independent candidates. The more controversial constitutional reforms include the nationalization of Chile's natural resources, limiting the amount of mining that can

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