What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2022-05-20 compared with 2021-11-22 · 468 added, 518 removed, 170 unchanged (85% of the section changed)

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Forward-Looking Statements

The information disclosed in this quarterly

report, and the information incorporated by reference herein, include “forward-looking statements” within the meaning of Section 27A

of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange

Forward-looking statements include, but are not limited to, statements regarding our or our management’s expectations,

hopes, beliefs, intentions, or strategies regarding the future.

In addition, any statements that refer to projections, forecasts, or other

characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements.

The words “anticipate,”

“believe,” “continue,” “could,” “estimate,” “expect,” “intend,”

“may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,”

“should,” “would,” and similar expressions may identify forward-looking statements, but the absence of these words

does not mean that a statement is not forward-looking.

The forward-looking statements contained

or incorporated by reference in this quarterly report are based on our current expectations and beliefs concerning future developments

and their potential effects on us and speak only as of the date of each such statement.

There can be no assurance that future developments

affecting us will be those that we have anticipated.

These forward-looking statements involve a number of risks, uncertainties (some of

which are beyond our control), or other assumptions that may cause actual results or performance to be materially different from those

expressed or implied by these forward-looking statements.

These risks and uncertainties include, but are not limited to, those factors

described in Item 2 of Part I of this quarterly report and in Item 1A of Part I of the Company’s Annual Report on Form 10-K for

the year ended December 31, 2020 as filed with the SEC on April 15, 2021.

Should one or more of these risks or uncertainties materialize,

or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking

We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future

events, or otherwise, except as may be required under applicable securities laws.

The following discussion should be read

in conjunction with our condensed consolidated interim financial statements and footnotes thereto contained in this quarterly report.

The information disclosed in this quarterly report, and the information

incorporated by reference herein, include “forward-looking statements” within the meaning of Section 27A of the Securities

Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

Forward-looking

statements include, but are not limited to, statements regarding our or our management’s expectations, hopes, beliefs, intentions

or strategies regarding the future.

In addition, any statements that refer to projections, forecasts or other characterizations of future

events or circumstances, including any underlying assumptions, are forward-looking statements.

The words “anticipate,” “believe,”

“continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,”

“plan,” “possible,” “potential,” “predict,” “project,” “should,”

“would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that

a statement is not forward-looking.

The forward-looking statements contained or incorporated by reference

in this quarterly report are based on our current expectations and beliefs concerning future developments and their potential effects

on us and speak only as of the date of each such statement.

There can be no assurance that future developments affecting us will be those

that we have anticipated.

These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control)

or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these

forward-looking statements.

These risks and uncertainties include, but are not limited to, those factors described in this Item 2 of Part

I and Item 1A of Part II of this quarterly report.

Should one or more of these risks or uncertainties materialize, or should any of our

assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements.

undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise,

except as may be required under applicable securities laws.

The following discussion should be read in conjunction with our condensed

consolidated interim financial statements and footnotes thereto contained in this quarterly report.

Western Uranium & Vanadium Corp.

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and change buildings, and an extensive underground haulage development with several vent shafts complete with exhaust fans.

These properties

were formerly secured by a first priority interest collateralizing a $500,000 promissory note which was paid in full on August 31, 2018,

and thus, the properties are now held free and clear of encumbrances.

The Sunday Mine Complex is the Company’s core resource property

and was assigned “Active” status effective June 2019.

Mine Complex is the Company’s core resource property and in July 2021 was assigned “Active” status when mining operations

were restarted.

On September 16, 2015, Western completed its acquisition

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February 2021 Private Placement

On February 16, 2021, the Company closed on a

non-brokered private placement of 3,250,000 units at a price of CAD $0.80 per unit.

The aggregate gross proceeds raised in the private

placement amounted to CAD $2,600,000.

Each unit consisted of one common share of Western (a “Share”) plus one common share

purchase warrant of Western (a “Warrant”).

Each warrant entitled the holder to purchase one Share at a price of CAD $1.20

per Share for a period of three years following the closing date of the private placement.

A total of 3,250,000 Shares and 3,250,000 Warrants

were issued in the private placement.

On February 16, 2021, the Company closed on a non-brokered private

placement of 3,250,000 units at a price of CAD $0.80 per unit.

The aggregate gross proceeds raised in the private placement amounted to

CAD $2,600,000.

Each unit consisted of one common share of Western plus one common share purchase warrant of Western.

Each warrant entitled

the holder to purchase one common share at a price of CAD $1.20 per share for a period of three years following the closing date of the

private placement.

A total of 3,250,000 common shares and 3,250,000 warrants were issued in the private placement.

March 2021 Private Placement

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to CAD $2,500,000.

Each unit consisted of one Share and one Warrant.

Each warrant entitled the holder to purchase one Share at a price

of CAD $1.20 per Share for a period of three years following the closing date of the private placement.

A total of 3,125,000 Shares and

3,125,000 Warrants were issued in the private placement.

Each unit consisted of one common share and one common share purchase warrant.

Each warrant entitled the holder to

purchase one common share at a price of CAD $1.20 per share for a period of three years following the closing date of the private placement.

A total of 3,125,000 common shares and 3,125,000 warrants were issued in the private placement.

December 2021 Private Placement

On December 17, 2021, the Company closed a non-brokered private placement

of 372,966 units at a price of CAD $1.60 per unit.

The aggregate gross proceeds raised in the private placement amounted to CAD $596,746

(USD $434,973 in net proceeds).

Each unit consisted of one common share plus one warrant.

Each warrant entitled the holder to purchase

one common share at a price of CAD $2.50 per share for a period of three years following the closing date of the private placement.

total of 372,966 common shares and 372,966 warrants were issued in the private placement.

January 2022 Private Placement

On January 20, 2022, the Company closed on a non-brokered private placement

of 2,495,575 units at a price of CAD $1.60 per unit.

The aggregate gross proceeds raised in the private placement amounted to CAD $3,992,920.

Each unit consisted of one common share of Western plus one common share purchase warrant of Western.

Each warrant entitled the holder

to purchase one common share at a price of CAD $2.50 per share for a period of three years following the closing date of the private placement.

A total of 2,495,575 common shares and 2,495,575 warrants were issued in the private placement.

Bullen Property (Weld County)

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Gas Conservation Commission (“COGCC”) to update the permit to create a new pooled unit.

During 2021, the operator advanced

through the oil well production stages:

drilling was completed in the first quarter, wellfield completion/fracking was completed during

the second quarter, drill out was completed in July, and flowback was completed in August.

By August 2021, each of the eight (8) Blue

Teal Fed wells had commenced oil and gas production.

The first gas production was sold in July and the first oil production was sold

Based upon Colorado rules, the operator may commence royalty payments not later than six months after the end of the month

in which production is first sold.

Thus the first monthly royalty check and royalty statement will be released at the January 2022 month-end

for the since inception cumulative for Western’s royalty interest in the pooled trust (0.003114 interest decimal).

Individual well

volumes are expected to continue to build to peak levels after about 100 days of production from the reservoir;

this will be accomplished

during the fourth quarter.

During 2021, the operator advanced through the oil well production stages:

drilling was completed in the first quarter, wellfield completion/fracking was completed during the second quarter, drill out was completed

in July, and flowback was completed in August.

By August 2021, each of the eight (8) Blue Teal Fed wells had commenced oil and gas production.

The first royalty payment was made in January 2022 and monthly royalty payments have been received subsequently.

These wells continue

to rank among the top Colorado producing wells.

Due to the success of the first 8 wells, the operator has decided to develop

a second set of 8 wells within Western’s royalty area during 2022.

During May 2022, the operator completed drilling all 8 of the

the next oil well production stages will follow in the same sequence as the 2021 wellfield development.

During the three months ended March 31, 2022 and

2021 the Company recognized aggregate revenue of $156,226 and $16,155, respectively, under these oil and gas lease arrangements.

31, 2022, the operator of the Weld County Colorado oil and gas pooled trust issued the first cumulative royalty payment in the amount

of $207,552 for August 2021 through December 2021 sales, which was recognized as income in the fourth quarter of 2021.

Kinetic Separation Licensing

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comment period.

In connection with this matter, the CDPHE consulted with the United States Nuclear Regulatory Commission (“NRC”).

In response, the CDPHE received an advisory opinion, dated October 16, 2016, which did not contain support for the NRC’s opinion

and with which the Company’s regulatory counsel does not agree.

NRC’s advisory opinion recommended that Kinetic Separation

should be regulated as a milling operation but did recognize that there may be exemptions to certain milling regulatory requirements because

of the benign nature of the non-uranium bearing sands produced after Kinetic Separation is completed on uranium-bearing ores.

1, 2016, the CDPHE issued a determination that the proposed Kinetic Separation operations at the Sunday Mine Complex must be regulated

by the CDPHE through a milling license.

The 2018 increase in the blended uranium/vanadium price has brought the Company closer to production.

Beginning in 2017, the Company’s regulatory counsel prepared significant documentation in preparation for a prospective submission.

On September 13, 2019, the Company’s regulatory counsel submitted a white paper to the NRC entitled “Recommendations on the

Proper Legal and Policy Interpretation for Using Kinetic Separation Processes at Uranium Mine Sites.” On July 24, 2020, the NRC

staff responded with a letter in support of the original conclusion.

In connection with this matter, the CDPHE consulted with the NRC.

In response, the CDPHE received an advisory opinion,

dated October 16, 2016, which did not contain support for the NRC’s opinion and with which the Company’s regulatory counsel

does not agree.

NRC’s advisory opinion recommended that Kinetic Separation should be regulated as a milling operation but did recognize

that there may be exemptions to certain milling regulatory requirements because of the benign nature of the non-uranium bearing sands

produced after Kinetic Separation is completed on uranium-bearing ores.

On December 1, 2016, the CDPHE issued a determination that the

proposed Kinetic Separation operations at the Sunday Mine Complex must be regulated by the CDPHE through a milling license.

in 2017, the Company’s regulatory counsel prepared significant documentation in preparation for a prospective submission.

13, 2019, the Company’s regulatory counsel submitted a white paper to the NRC entitled “Recommendations on the Proper Legal

and Policy Interpretation for Using Kinetic Separation Processes at Uranium Mine Sites.” On July 24, 2020, the NRC staff responded

with a letter in support of the original conclusion.

Western’s regulatory counsel has proposed alternatives.

management has decided not to proceed at this time, given its present opportunity set.

Sunday Mine Complex Vanadium Project Supplementary Requirements

On June 18, 2019, The Colorado Division of Reclamation,

Mining and Safety (CDRMS) issued a letter indicating limited supplementary requirements prior to the removal of material (ore) from the

Sunday Mine Complex’s underground workings and further offsite handling.

In a follow-up meeting on Monday, August 5, 2019, the Company

agreed to construct an ore pad on the surface before stockpiling or storing ore outside the mine and acquire certification that the storm

drainage system was constructed in accordance with the existing plan prior to the removal of ore from the Sunday Mine Complex.

15, 2019, the Company sent a response letter to CDRMS providing the requested additional information regarding the reopening of the Sunday

Mine Complex.

On September 18, 2019, the CDRMS issued a letter indicating that activities at the Sunday Mine Complex do not meet the definition

of a “Mining Operation”, and thus, at this time, the Division does not consider the permits in active status.

In the letter,

CDRMS reiterated that prior to the removal of ore material from the mines and upgrading to an active status, the CDRMS surface requirements

needed to be completed, inspected, and accepted by CDRMS.

The CDRMS further noted requirements that would apply to Western’s proposed

off-site kinetic separation test facility.

On April 9, 2020, CDRMS issued a letter acknowledging that the Construction Completion Reports

and As-Built Certifications for the ore storage pads have been reviewed and accepted.

It was further noted that prior to ore being removed

and placed on the ore pad an inspection would still need to be completed, but due to COVID-19 the CDRMS staff were subject to a no-travel

policy under the Governor’s Stay-at-Home Order.

Hence, CDRMS offered an alternative remote procedure requiring extensive photo documentation

and a signed affidavit from both the manufacturer and installation crew certifying that the ore pad liner was installed in accordance

with the approved Environmental Protection Plan.

Additional requirements included the submission of a comprehensive hydrogeology report

and completion of the Sunday Mine Complex MLRB permit hearing process.

With this approval, Western has now completed every project, study,

and submission stipulated as required under the existing Environmental Protection Plan by CDMRS, and all submissions have been made.

hydrogeology report is currently being reviewed by CDMRS, and approval is needed to conduct mining activities below the static groundwater

level or to affect ground or surface waters.

The Company is working toward the completion of an updated Plan of Operations, which is required

for resumption of mining activities at the Topaz mine.

However, management

has decided not to proceed at this time, given its present opportunity set.

Sunday Mine Complex Permitting Status

On February 4, 2020, the Colorado DRMS sent a

Notice of Hearing to Declare Termination of Mining Operations related to the status of the mining permits issued by the state of Colorado

for the Sunday Mine Complex.

At issue was the application of an unchallenged Colorado Court of Appeals Opinion for a separate mine (Van

4) with very different facts that are retroactively modifying DRMS rules and regulations.

The Company maintains that it was timely in

meeting existing rules and regulations.

The hearing was scheduled to be held during several monthly MLRB Board meetings, but this matter

was delayed several times.

On February 4, 2020, the Colorado DRMS sent a Notice of Hearing to

Declare Termination of Mining Operations related to the status of the mining permits issued by the state of Colorado for the Sunday Mine

At issue was the application of an unchallenged Colorado Court of Appeals Opinion for a separate mine (Van 4) with very different

facts that are retroactively modifying DRMS rules and regulations.

The Company maintains that it was timely in meeting existing rules

and regulations.

The hearing was scheduled to be held during several monthly MLRB Board meetings, but this matter was delayed several

The permit hearing was held during the MLRB Board monthly meeting on July 22, 2020.

At issue was the status

of the five existing permits which comprise the Sunday Mine Complex.

Due to COVID-19 restrictions, the hearing took place utilizing a

virtual-only format.

The Company prevailed in a 3-to-1 decision which acknowledged that the work completed at the Sunday Mine Complex

under DRMS oversight was timely and sufficient for Western to maintain these permits.

In a subsequent July 30, 2020 letter, the DRMS notified

the Company that the status of the five permits (Sunday, West Sunday, St.

Jude, Carnation, and Topaz) had been changed to “Active”

status effective June 10, 2019, the original date on which the change of the status was approved.

On August 23, 2020, the Company initiated

a request for Temporary Cessation status for the Sunday Mine Complex as the mines had not been restarted within a 180-day window due to

the direct and indirect impacts of the COVID-19 pandemic.

Accordingly, a permit hearing was scheduled for October 21, 2020 to determine

Temporary Cessation status.

In a unanimous vote, the MLRB approved Temporary Cessation status for each of the five Sunday Mine Complex

permits (Sunday, West Sunday, St.

At issue was the status of the five existing

permits which comprise the Sunday Mine Complex.

Due to COVID-19 restrictions, the hearing took place utilizing a virtual-only format.

The Company prevailed in a 3-to-1 decision which acknowledged that the work completed at the Sunday Mine Complex under DRMS oversight

was timely and sufficient for Western to maintain these permits.

In a subsequent July 30, 2020 letter, the DRMS notified the Company that

the status of the five permits (Sunday, West Sunday, St.

Jude, Carnation, and Topaz) had been changed to “Active” status effective

June 10, 2019, the original date on which the change of the status was approved.

On August 23, 2020, the Company initiated a request for

Temporary Cessation status for the Sunday Mine Complex as the mines had not been restarted within a 180-day window due to the direct and

indirect impacts of the COVID-19 pandemic.

Accordingly, a permit hearing was scheduled for October 21, 2020 to determine Temporary Cessation

In a unanimous vote, the MLRB approved Temporary Cessation status for each of the five Sunday Mine Complex permits (Sunday, West

Jude, Carnation, and Topaz).

On October 9, 2020, the MLRB issued a board order which finalized the findings

of the July 22, 2020 permit hearing.

On November 12, 2020, a coalition of environmental groups filed a lawsuit against the MLRB seeking

a partial appeal of the July 22, 2020 decision by requesting termination of the Topaz mine permit.

On December 15, 2020, the same coalition

of environmental groups amended their complaint against the MLRB seeking a partial appeal of the October 21, 2020 decision requesting

termination of the Topaz mine permit.

On October 9, 2020, the MLRB issued a board order which finalized the findings of the July 22,

2020 permit hearing.

On November 12, 2020, a coalition of environmental groups filed a lawsuit against the MLRB seeking a partial appeal

of the July 22, 2020 decision by requesting termination of the Topaz mine permit.

On December 15, 2020, the same coalition of environmental

groups amended their complaint against the MLRB seeking a partial appeal of the October 21, 2020 decision requesting termination of the

Topaz mine permit.

The Company has joined with the MLRB in defense of their July 22, 2020 and October 21, 2020 decisions.

On May 5, 2021, the Plaintiff in the Topaz Appeal filed an opening brief with the Denver District Court seeking to overturn the July 22,

2020 and October 21, 2020 MLRB permit hearing decisions on the Topaz mine permit.

The MLRB and the Company were to respond with an answer

brief within 35 days on or before June 9, 2021, but instead sought a settlement.

The judicial review process was delayed as extensions

were put in place until August 20, 2021.

On May 5, 2021,

the Plaintiff in the Topaz Appeal filed an opening brief with the Denver District Court seeking to overturn the July 22, 2020 and October

21, 2020 MLRB permit hearing decisions on the Topaz mine permit.

The MLRB and the Company were to respond with an answer brief within

35 days on or before June 9, 2021, but instead sought a settlement.

The judicial review process was delayed as extensions were put in

place until August 20, 2021.

A settlement was not reached and the MLRB and the Company submitted answer briefs on August 20, 2021.

The Plaintiff submitted a reply brief on September 10, 2021.

Plaintiff submitted a reply brief on September 10, 2021.

On March 1, 2022, the Denver District Court reversed the MLRB’s orders

regarding the Topaz Mine and remanded the case back to MLRB for further proceedings consistent with its order.

The Company and the MLRB

had until April 19, 2022 to appeal the Denver District Court’s ruling.

Neither the Company nor the MLRB appealed the Denver District

Court ruling.

Western anticipates receiving an MLRB board order of reclamation for the Topaz Mine in June/July 2022.

The Company is continuing

to work toward the completion of an updated Topaz Mine Plan of Operations which is a separate federal requirement of the BLM for the conduct

of mining activities on federal land that has precluded the Company from commencing active mining operations at the Topaz Mine.

Sunday Mine Complex Project 2021 Restart

In July 2021, the Company announced its preparation

for the resumption of mining activities at the Sunday Mine Complex (SMC).

The project entailed the development of multiple SMC ore bodies.

This year’s project involves a shift in the base of operations from the St.

The SMC project entailed the development of multiple SMC ore bodies

and involves a shift in the base of operations from the St.

Jude Mine (2019) to the Sunday Mine (2021).

development began in August following mine ventilation, power upgrades, and increasing explosive capabilities.

The first target was the

extension of the drift (tunnel) 150 feet to reach the first surface exploration drill hole to access the GMG Ore Body (GMG).

Early results

were positive as drilling toward the GMG resulted in the location of ore-grade material within thirty feet of the existing mine workings.

Notably, only limited exploration drilling has been done in this area due to the mountainous terrain on the surface above.

proceeded, very high-grade ore continued to be intersected through the drift path and on both sides of the drift.

As a result, the team

shifted from development to mining.

In a matter of only three working days, over 300 tons of high-grade uranium/vanadium ore was mined

from the drift.

Based upon on-site scintillometer readings, the content is estimated to contain 1.5%+ uranium U 3 O 8 .

Results indicate higher resource grades and larger quantities than expected.

Development of the GMG Ore Body will continue throughout

the remaining part of this year and into early 2022.

Van 4 Mine Permitting Status

A prior owner of the Van 4 mine had been granted

a first Temporary Cessation from reclamation of the mine by the Colorado Mined Land Reclamation Board (“MLRB”) which was set

to expire June 23, 2017.

Prior to its expiration, PRM formally requested an extension through a second Temporary Cessation.

PRM subsequently

participated in a public process which culminated in a hearing on July 26, 2017.

Prior to the hearing, three non-profit organizations

who pursue environmental and conservation objectives filed a brief objecting to the extension.

The MLRB board members voted to grant a

second five-year Temporary Cessation for the Van 4 mine.

Thereafter, the three objecting parties filed a lawsuit on September 18, 2017.

The MLRB was named as the defendant and PRM was named as a party to the case due to the Colorado law requirement that any lawsuit filed

after a hearing must include all of the parties in the proceeding.

The plaintiff organizations are seeking for the court to set aside

the board order granting a second five-year Temporary Cessation period to PRM for the Van 4 mine.

The Colorado state Attorney General

was defending this action in the Denver Colorado District Court.

On May 8, 2018, the Denver Colorado District Court ruled in favor, whereby

the additional five-year Temporary Cessation period was granted.

The Plaintiffs appealed this ruling to the Colorado Court of Appeals,

and on July 25, 2019, the ruling was reversed, ruling that the additional five-year Temporary Cessation period should not have been granted.

The MLRB and the Colorado Attorney General advised

Western that it will not make an additional appeal of the ruling.

Further, the time period for an appeal has passed.

The judge has subsequently

issued an instruction for the MLRB to issue an order revoking the permit and putting the Van 4 mine into reclamation.

On January 22, 2020,

the MLRB held a hearing, and on March 2, 2020, the MLRB issued an order vacating the Van 4 Temporary Cessation, revoking the permit, and

ordering commencement of final reclamation, which must be completed within five years.

The Company commenced reclamation of the Van 4

mine, but progress has been delayed both by COVID-19 restrictions and countywide fire and open flame restrictions.

The reclamation cost

is fully covered by the reclamation bonds posted upon acquisition of the property.

The Van 4 reclamation is ongoing.

Underground development began

in August following mine ventilation, power upgrades, and increasing explosive capabilities.

The first target was the extension of the

drift (tunnel) 150 feet to reach the first surface exploration drill hole to access the GMG Ore Body (GMG).

Early results were positive

as drilling toward the GMG resulted in the location of ore-grade material within thirty feet of the existing mine workings.

Notably, only

limited exploration drilling has been done in this area due to the mountainous terrain on the surface above.

As drifting proceeded, very

high-grade ore continued to be intersected through the drift path and on both sides of the drift.

As a result, the team shifted from development

From December 2021 to March 2022, over 3,000 tons of high-grade uranium/vanadium ore was mined from the drift.

The mining contractor

calculated grades based upon on site scintillometer readings.

At the end of March 2022, the mining contractor engaged by Western

decided to retire from contract mining operations.

As a result of this decision, Western will take over the mining operations and has

acquired a full complement of mining equipment.

The equipment is being prepared for operations and upgrades to mine ventilation, support

buildings and infrastructure are underway.

Further mine development and ore production is targeted for resumption in thesummer after upgrades

are completed.

Western’s mining team will be expanded to facilitate mine development and full ore production.

Uranium Section 232 Investigation/Nuclear Fuel Working Group

An investigation under Section 232 of the Trade

Expansion Act of 1962 was undertaken by the U.S Department of Commerce (“DoC”) in 2018 to assess the impact to national security

of the importation of the vast majority of uranium utilized by the approximately 100 operative civilian nuclear reactors within the United

In response to the Section 232 report, the White House disseminated a Presidential Memoranda in July 2019.

At that time, President

Trump formed the Nuclear Fuel Working Group (“NFWG”) to find solutions for reviving and expanding domestic nuclear fuel production

and reinvigorating recommendations.

In April 2020, the U.S.

Department of Energy (“DoE”)

released the NFWG report entitled “Restoring America’s Competitive Nuclear Energy Advantage – A strategy to assure U.S.

national security.” The report outlines a strategy for the reestablishment of critical capabilities and direct support to the front

end of the U.S.

domestic nuclear fuel cycle.

Expansion Act of 1962 was undertaken by the DoC in 2018 to assess the impact to national security of the importation of the vast majority

of uranium utilized by the approximately 100 operative civilian nuclear reactors within the United States.

In response to the Section

232 report, the White House disseminated a Presidential Memoranda in July 2019.

At that time, President Trump formed the Nuclear Fuel

Working Group (“NFWG”) to find solutions for reviving and expanding domestic nuclear fuel production and reinvigorating recommendations.

In April 2020, the DoE released the NFWG report

entitled “Restoring America’s Competitive Nuclear Energy Advantage – A strategy to assure U.S.

national security.”

The report outlines a strategy for the reestablishment of critical capabilities and direct support to the front end of the U.S.

nuclear fuel cycle.

The NFWG findings and recommendations presented are a positive outcome for U.S.

uranium miners;

however, the ultimate outcome and timing remains uncertain as the continuing process requires approvals and budget appropriation from

Congress and implementation by U.S.

however, the ultimate

outcome and timing remains uncertain as the continuing process requires approvals and budget appropriation from Congress and implementation

government agencies.

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This is being done to level the playing field versus state-sponsored foreign entities.

Congress passed the “COVID-Relief and Omnibus Spending Bill,” which included $75 million for the establishment

of a strategic U.S.

In December 2020, U.S.

Congress passed the “COVID-Relief

and Omnibus Spending Bill,” which included $75 million for the establishment of a strategic U.S.

Uranium Reserve.

The Biden-Harris Administration has rolled the 2021 funding into its 2022 fiscal year budget to continue

this initiative.

The DoE continues to work on establishing the parameters of the program and in August 2021, the DoE put out a Request

for Information (RFI) to obtain additional comments related to the establishment of the DOE’s Uranium Reserve program.

13, 2021, Western submitted a response to the Request for Information:

Establishment of the Uranium Reserve Program to the DOE’s

National Nuclear Security Administration

Also, recent follow through includes the

July 2021 public release of the uranium Section 232 report which the DoC presented to President Trump in April 2019.

concluded that uranium imports were “weakening our internal economy” and “threaten to impair the national

security” and recommended immediate actions to “enable U.S.

producers to recapture and sustain a market share of U.S.

The Biden-Harris

Administration has rolled the 2021 funding into its 2022 fiscal year budget to continue this initiative.

In July 2021, the uranium Section

232 report was publicly released.

The report concluded that uranium imports were “weakening our internal economy” and “threaten

to impair the national security” and recommended immediate actions to “enable U.S.

producers to recapture and sustain a market

share of U.S.

uranium consumption”.

These actions were not taken in favor of the NFWG process.

The DoE continues to work on establishing the parameters of the program and in August 2021,

the DoE put out a Request for Information (RFI) to obtain additional comments related to the establishment of the DoE’s Uranium

Reserve program.

On October 13, 2021, Western submitted a response to the Request for Information:

Establishment of the Uranium Reserve

Program to the DoE’s National Nuclear Security Administration.

The Russian invasion of Ukraine has fast tracked

the Uranium Reserve Program.

On May 5, 2022, the U.S.

Secretary of Energy Jennifer Granholm’s testified before the Senate Committee

on Energy and Natural Resources that the DoE “would make direct purchases of domestically mined and converted uranium this calendar

year to establish a strategic uranium reserve”.

Secretary Granholm’s comments make clear that the U.S.

is thinking larger.

Granholm stated that “We should not be sending any money to Russia for any American energy or for any other reason,” and “if

we move away from Russia right away, we want to make sure we have the ability to continue to keep the fleet afloat.” To accomplish

this she further disclosed that the DoE is “developing a full-on uranium strategy that’s going through the interagency process.”

In February, Russia invaded Ukraine commencing a war between the two

Russia is a major global energy supplier and both countries are top ten uranium producers, and Russia is a global leader in

nuclear fuel services.

Thus, these actions caused a surge in energy prices.

On the day prior to the invasion, the spot price of uranium

was less than $44/lbs and it increased to a decade high peak of over $63/lbs, before subsequently declining below $50/lbs spot prices.

Russia’s invasion of Ukraine has called into question their role and future participation in the nuclear fuel cycle.

been the target of unprecedented economic sanctions which have created bottlenecks of Russian exports, including nuclear fuel.

of a large global dependence, nuclear fuel purchasers are continuing to diversify away from Russian nuclear fuel.

As a result of these

new realities, the U.S.

Congress is considering both sanctions and multiple pieces of legislation focusing on prohibiting the importation

of Russian uranium and nuclear fuel, which is likely to benefit the U.S.

domestic mining industry.

Further, there remains the possibility

that Russia might reverse-sanction the United States and not make nuclear fuel deliveries.

Vanadium Section 232 Investigation

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circumstances of vanadium imports into the United States threaten to impair the national security.

The initiation of this investigation

created a 270-day window, which lasted until February 2021, to compile and deliver a report to the President of the United States.

Section 232 National Security Investigation of Imports of Vanadium was concluded, and a report was submitted to President Biden in February

2021.In July 2021, the report was made public.

It concluded that vanadium imports “do not threaten to impair the national security

as defined in Section 232,” but identified and recommended “several actions that would help to ensure reliable domestic sources

of vanadium and lessen the potential for imports to threaten national security.” No action has been taken on these recommendations.

The Section 232 National Security Investigation

of Imports of Vanadium was concluded, and a report was submitted to President Biden in February 2021.

In July 2021, the report was made

It concluded that vanadium imports “do not threaten to impair the national security as defined in Section 232,” but

identified and recommended “several actions that would help to ensure reliable domestic sources of vanadium and lessen the potential

for imports to threaten national security.” No action has been taken on these recommendations.

Biden-Harris Administration

The positive momentum has continued for the nuclear

and uranium mining sector due to the Biden-Harris Administration’s emphasis on climate change.

The “Plan to Build a Modern

Sustainable Infrastructure and an Equitable Clean Energy Future” emphasizes climate change solutions.

Upon taking office, the Biden

team immediately rejoined the Paris Agreement and continued its pursuit of campaign promises of investments in clean energy, creating

jobs, producing clean electric power, and achieving carbon-pollution free energy in electricity generation by 2035.

Since taking office,

President Biden has given all agencies climate change initiatives and has started a climate change working group.

The positive momentum has continued for the nuclear and uranium mining

sector due to the Biden-Harris Administration’s emphasis on climate change.

The “Plan to Build a Modern Sustainable Infrastructure

and an Equitable Clean Energy Future” emphasizes climate change solutions.

Upon taking office, the Biden team immediately rejoined

the Paris Agreement and continued its pursuit of campaign promises of investments in clean energy, creating jobs, producing clean electric

power, and achieving carbon-pollution free energy in electricity generation by 2035.

Since taking office, President Biden has given all

agencies climate change initiatives and has started a climate change working group.

The existing U.S.

reactor fleet currently produces in excess of 50% of U.S.

clean energy, and new, advanced nuclear technologies promise to generate additional

clean energy.

A White House national climate advisor told the media in a press briefing that the Biden-Harris Administration intends to

seek a national clean energy standard that includes nuclear energy.

The Company believes that nuclear energy will be increasingly able

to compete on a level playing field with renewable energy technologies.

There has been legislative advancement of implementation

mechanisms including tax credits, subsidies, and/or U.S.

utilities being required to produce an increasing proportion of electricity

generation from clean energy power sources.

President Biden’s Build Back Better agenda has several components supportive of nuclear

power generation.

Already signed into law is the $1.2 trillion Infrastructure Investment and Jobs Act that provides the United States

Department of Energy funding to prevent the premature retirement of existing nuclear plants and invest in advanced nuclear projects.

The separate $1.7 trillion Build Back Better Reconciliation Legislation, which is making its way through the U.S.

Congress, further addresses

climate change through the inclusion of a zero-emission nuclear power production credit.

If passed in its current form, beginning in

2022 qualified nuclear power facilities would be eligible to receive a base credit and a bonus credit if certain requirements are met.

Biden attended the United Nations Climate Change Conference (COP26) in Glasgow, Scotland.

His administration simultaneously released

a proposed plan targeting the reduction of methane emissions.

Many of the proposed initiatives from the Climate Summit target reduced

utilization of fossil fuels and if implemented expand future opportunities for nuclear power generation, given its ability to provide

baseload and carbon-free energy.

To conclude the COP2, in a surprise announcement, the U.S.

and China pledged to work together to slow

global warming.

nuclear reactor fleet currently

produces in excess of 50% of U.S.

clean energy, and new, advanced nuclear technologies promise to generate additional clean energy.

White House national climate advisor told the media in a press briefing that the Biden-Harris Administration intends to seek a national

clean energy standard that includes nuclear energy.

The Company believes that nuclear energy will be increasingly able to compete on a

level playing field with renewable energy technologies.

There has been legislative advancement of implementation mechanisms

including tax credits, subsidies, and/or U.S.

utilities being required to produce an increasing proportion of electricity generation from

clean energy power sources.

President Biden’s Build Back Better agenda has several components supportive of nuclear power generation.

Already signed into law is the $1.2 trillion Infrastructure Investment and Jobs Act that provides the DoE funding to prevent the premature

retirement of existing nuclear plants and invest in advanced nuclear projects.

The separate $1.7 trillion Build Back Better Reconciliation

Legislation, which has not yet made its way through the U.S.

Congress, further addresses climate change through the inclusion of a zero-emission

nuclear power production credit.

If passed in its current form, beginning in 2022 qualified nuclear power facilities would be eligible

to receive a base credit and a bonus credit if certain requirements are met.

President Biden attended the United Nations Climate Change Conference

(COP26) in Glasgow, Scotland.

His administration simultaneously released a proposed plan targeting the reduction of methane emissions.

Many of the proposed initiatives from the Climate Summit target reduced utilization of fossil fuels and if implemented expand future opportunities

for nuclear power generation, given its ability to provide baseload and carbon-free energy.

To conclude the COP2, in a surprise announcement,

and China pledged to work together to slow global warming.

This is significant because the U.S.

and China represent the two countries with the largest CO2 emissions.

pledged to take “enhanced climate actions” to meet the 2015 Paris Agreement temperature goal of limiting global warming to

less than 1.5C.

and China represent the two countries

with the largest CO2 emissions.

They jointly pledged to take “enhanced climate actions” to meet the 2015 Paris Agreement temperature

goal of limiting global warming to less than 1.5C.

The Harris-Biden Administration has shifted its focus toward the Russia/Ukraine

conflict and the implementation of multiple rounds of sanctions, participating in the international response, and providing support.

DoE has been outspoken and is working hard at creating nuclear fuel solutions to address the current dependence and promote a geopolitical

realignment of the nuclear fuel cycle away from Russia.

Strategic Acquisition of Physical Uranium

On June 2, 2021, the Company executed a binding

agreement to purchase 125,000 pounds of natural uranium concentrate at the market price, in which the Company plans to take delivery on

or before June 2022.

In May 2021, the Company executed a binding agreement

to purchase 125,000 pounds of natural uranium concentrate at $32.16 per pound.

In December 2021, the Company paid $4,020,000 in connection

with its full prepayment of the purchase price for 125,000 pounds of natural uranium concentrate.

This uranium concentrate was subsequently

delivered under the terms of the uranium supply agreement in April 2022.

Uranium Supply Agreement Delivery

In April 2022, in satisfaction of the Year 5 delivery

under its supply contract, the Company delivered 125,000 lbs of uranium concentrate from its prepaid uranium concentrate inventory.

delivery of uranium concentrate resulted in a sale of $7,130,000, at a price of $57.04 per pound.

In May 2022, the Company received the

cash proceeds from this sale.

Sprott Physical Uranium Trust

The Sprott Physical Uranium Trust (U.UN) (the

“Trust”) took over the former Uranium Participation Corp.

(U.TO) and launched an at-the-market program (ATM) on August 17,

2021 to raise capital for the closed-ended trust.

In the three month period, since the inception of the ATM program, the Trust has bought

about 21 million pounds of uranium and spot prices have increased from a low of $30 to a peak of $51 before declining to $47 at the end

of this period.

Notably, the Trust’s activities have increased price discovery in the spot uranium markets and have removed inventory

from the market.

During 2020 and continuing into 2021, the world

has been, and continues to be, impacted by the COVID-19 pandemic.

COVID-19, and measures to prevent its spread, impacted our business

in a number of ways.

The impact of these disruptions and the extent of their adverse impact on the Company’s financial and operating

results will be dictated by the length of time that such disruptions continue, which will, in turn, depend on the currently unpredictable

duration and severity of the impacts of COVID-19, and among other things, the impact of governmental actions imposed in response to COVID-19

and individuals’ and companies’ risk tolerance regarding health matters going forward and developing strain mutations.

date, COVID-19 has primarily caused Western delays in reporting, regulatory matters, and operations.

Most notably, the Company initiated

a request for Temporary Cessation status for the Sunday Mine Complex in August 2020 as the mines had not been restarted within the 180-day

window due to the direct and indirect impacts of the COVID-19 pandemic.

The Van 4 mine reclamation process was also delayed because of

the COVID-19 pandemic.

The Company is monitoring COVID-19’s potential impact on the Company’s operations.

The Sprott Physical Uranium Trust (U.UN) (the “Trust”)

took over the former Uranium Participation Corp.

(U.TO) and launched an at-the-market program (ATM) on August 17, 2021 to raise capital

for the closed-ended trust.

Since the inception of the ATM program, the Trust has bought significant quantities of uranium causing spot

prices to increase.

The New York Stock Exchange (NYSE) declined the U.S.

listing application for the anticipated Sprott U.S.

uranium trust vehicle.

Sprott has stated that they do not have an intent to further pursue a listing on a US exchange “in the near

term.” Since the Trust was launched it has purchased in excess of 37 million pounds of uranium, and Sprott has grown the Canadian

listed vehicle to ~ $3 billion.

Due to Sprott’s success a clone physical uranium fund was launched

on May 12, 2022.

The ANU Energy OEIC Ltd fund raised over $75 million dollars in a private placement and has made its first uranium purchase.

Kazatomprom, the world’s largest producer of uranium is a strategic investor and uranium supplier to ANU Energy.

Kazatomprom has

made the first uranium delivery at Cameco’s Port Hope conversion facility.

The world has been, and continues to be, impacted by the novel coronavirus

(“COVID-19”) pandemic.

COVID-19, and measures to prevent its spread, impacted our business in a number of ways.

of these disruptions and the extent of their adverse impact on the Company’s financial and operating results will be dictated by

the length of time that such disruptions continue, which will, in turn, depend on the currently unpredictable duration and severity of

the impacts of COVID-19, and among other things, the impact of governmental actions imposed in response to COVID-19 and individuals’

and companies’ risk tolerance regarding health matters going forward and developing strain mutations.

To date, COVID-19 has primarily

caused Western delays in reporting, regulatory matters, and operations.

Most notably, the Company initiated a request for Temporary Cessation

status for the Sunday Mine Complex in August 2020 as the mines had not been restarted within the 180-day window due to the direct and

indirect impacts of the COVID-19 pandemic.

The Van 4 Mine reclamation process was delayed because of COVID-19 pandemic lockdowns.

need to observe quarantine periods also caused a limited loss of manpower and delay to the 2021 / 2022 Sunday Mine Complex project.

COVID-19 pandemic has limited and continues to limit Western’s participation in industry and investor conference events.

is continuing to monitor COVID-19 and its subvariants and the potential impact of the pandemic on the Company’s operations.

Results of Operations

For the Three Months Ended

September 30,

For the Nine Months Ended

September 30,

Lease revenue

For the Three Months Ended March 31,

Lease and royalty revenue

Mining expenditures

4 unchanged sentences

Operating loss

Interest expense, net

Settlement expense

Warrant modification expense

Other Comprehensive income (expense)

Foreign exchange gain (loss)

Accretion and interest

Other Comprehensive income

Foreign exchange gain

Comprehensive Loss

Net loss per share - basic and diluted

Three Months Ended September 30, 2021 as Compared to the Three

Months Ended September 30, 2020

Our condensed consolidated net loss for the three

months ended September 30, 2021 and 2020 was $830,493 and $366,433 for ($0.02) and ($0.01) per share, respectively.

The principal components

of these quarter over quarter changes are discussed below.

Our comprehensive loss for the three months ended

September 30, 2021 and 2020 was $876,856 and $351,728, respectively.

Our revenue for the three months ended September

30, 2021 and 2020 was $16,155 and $11,155, respectively.

This revenue resulted from lease revenue pursuant to a July 18, 2017 oil and

gas lease agreement, which was extended for an additional three years in 2020 at a 150% increased rate.

The February 2, 2018 pipeline

easement, with the initial operator has terminated resulting in a decrease in this portion of revenue.

The July 1, 2018 right-of-way agreement

with the new operator was consistent between periods.

The aforementioned revenue streams are derived from the Weld County oil and gas

Mining Expenditures

Mining expenditures for the three months ended

September 30, 2021 were $335,028 as compared to $53,166 for the three months ended September 30, 2020.

The increase in mining expenditures

of $281,862, or 530% was principally attributable to mining expenditures related to resumption of mining operations at the Company’s

Sunday Mine Complex during the third quarter of 2021.

Professional Fees

Professional fees for the three months ended September

30, 2021 were $136,174 as compared to $67,356 for the three months ended September 30, 2020.

The increase in professional fees of $68,818,

or 102% is primarily attributable to a $68,014 increase in legal fees.

General and Administrative

General and administrative expenses for the three

months ended September 30, 2021 were $361,301 as compared to $241,300 for the three months ended September 30, 2020.

The increase in general

and administrative expense of $120,001, or 50% is principally due to a $76,174 increase in payroll expenses and an $18,561 increase in

utilities in connection with the Sunday Mine Complex project.

Consulting Fees

Consulting fees for the three months ended September

30, 2021 were $12,801 as compared to $10,846 for the three months ended September 30, 2020.

The increase in consulting fees of $1,955

or 18% was principally due to the Company’s increased utilization of consultants during the current period.

Interest Expense, net

Interest expense, net, for the three months ended

September 30, 2021 was $1,344 as compared to $4,920 for the three months ended September 30, 2020.

The decrease of interest expense, net,

of $3,576 was due to the forgiveness of the Company’s Paycheck Protection Program loan during 2020.

Foreign Exchange

Foreign exchange gain (loss) for the three months

ended September 30, 2021 was $(46,363) as compared to $14,705 for the three months ended September 30, 2020.

The increase of the foreign

exchange loss is primarily due to holding cash balances in Canadian Dollars and the translation gain from using United Stated Dollars

as the reporting currency.

Nine Months Ended September 30, 2021 as Compared to the Nine

Months Ended September 30, 2020

Our condensed consolidated net loss for the nine

months ended September 30, 2021 and 2020 was $1,596,717 and $2,173,086 or ($0.04) and ($0.07) per share, respectively.

The principal components

of these quarter over quarter changes are discussed below.

Our comprehensive loss for the nine months ended

September 30, 2021 and 2020 was $1,573,186 and $2,274,182, respectively.

Our revenue for the nine months ended September

30, 2021 and 2020 was $48,465 and $33,465, respectively.

This revenue resulted from lease revenue pursuant to a July 18, 2017 oil and

gas lease agreement, which was extended for an additional three years in 2020 at a 150% increased rate.

The February 2, 2018 pipeline

easement, with the initial operator has terminated resulting in a decrease in this portion of revenue.

The July 1, 2018 right-of-way agreement

with the new operator was consistent between periods.

The aforementioned revenue streams are derived from the Weld County oil and gas

Three Months Ended March 31, 2022 as Compared to the Three Months

Ended March 31, 2021

Our consolidated net loss for the three months ended March 31, 2022

and 2021 was $1,173,603 and $291,614 or $0.03 and $0.01 per share, respectively.

The principal components of these year over year changes

are discussed below.

Our comprehensive loss for the three months ended March 31, 2022 and

2021 was $1,116,942 and $246,650, respectively.

Our revenue for the three months ended March 31, 2022 and 2021 was

$156,226 and $16,155, respectively.

This revenue resulted from lease revenue pursuant to a July 18, 2017 oil and gas lease agreement,

which was extended for an additional three years in 2020 at a 150% increased rate.

The February 2, 2018 pipeline easement, with the initial

operator has terminated resulting in a decrease in this portion of revenue.

The July 1, 2018 right-of-way agreement with the new operator

was consistent between periods.

On January 31, 2022, the operator of the Weld County Colorado oil and gas pooled trust issued the first

cumulative royalty payment check in the amount of $207,552 for August 2021 through December 2021 sales which was recognized as income

in the fourth quarter of 2021.

Subsequently, in 2022, monthly royalty checks were disseminated for sales during each of the months in

the first quarter.

Mining Expenditures

Mining expenditures for the nine months ended

September 30, 2021 were $422,921 as compared to $345,637 for the nine months ended September 30, 2020.

The increase in mining expenditures

of $77,284 or 22% was principally attributable to mining expenditures related the resumption of mining operations at the Company’s

Sunday Mine Complex during the third quarter of 2021.

Mining expenditures for the three months ended March 31, 2022 were

$289,038 as compared to $47,859 for the three months ended March 31, 2021.

The increase in mining expenditures of $241,179, or 504% was

principally attributable to mining expenditures related to restarting mining operations at the Company’s Sunday Mine Complex during

the third quarter of 2021.

Professional Fees

Professional fees for the nine months ended September

30, 2021 were $287,042 as compared to $252,533 for the nine months ended September 30, 2020.

The increase in professional fees of $34,509,

or 14% was due to a $49,823 increase in legal fees offset by an $11,764 reduction in investor relations costs.

Professional fees for the three months ended March 31, 2022 were $136,060

as compared to $46,387 for the three months ended March 31, 2021.

The increase in professional fees of $89,673, or 193% was primarily

due to a $63,585 increase in legal fees.

General and Administrative

General and administrative expenses for the nine

months ended September 30, 2021 were $835,281 as compared to $911,080 for the nine months ended September 30, 2020.

The decrease in general

and administrative expense of $75,799, or 8% is due to a $208,059 decrease in stock-based compensation expense offset by an increase of

$106,688 in payroll expenses and an increase of $21,331 in utilities expenses in connection with the Sunday Mine Complex project.

General and administrative expenses for the three months ended March

31, 2022 were $863,062 as compared to $211,181 for the three months ended March 31, 2021.

The increase in general and administrative expense

of $651,881, or 309% is due to a $495,120 increase in stock-based compensation expense, $89,862 increase in payroll expenses, and an increase

of $19,940 in utilities expenses from the Sunday Mine Complex project.

Consulting Fees

Consulting fees for the nine months ended September

30, 2021 were $16,810 as compared to $47,668 for the nine months ended September 30, 2020.

The decrease in consulting fees was principally

due to the Company’s reduced utilization of consultants during the current period.

Interest Expense, net

Interest expense, net, for the nine months ended

September 30, 2021 was $4,687 as compared to $10,621 for the nine months ended September 30, 2020.

The decrease of interest expense, net,

of $5,934 was principally due to the forgiveness of the Company’s Paycheck Protection Program (PPP) loan.

Consulting fees for the three months ended March 31, 2022 were $39,512

as compared to $0 for the three months ended March 31, 2021.

The increase in consulting fees of $39,512 was principally due to the Company’s

reduced utilization of consultants during the first quarter of 2021 due to COVID-19.

Accretion and Interest

Accretion and interest for the three month ended December 31, 2022

was $2,157 as compared to $2,342 for the three months ended March 31, 2021.

Foreign Exchange

Foreign exchange gain (loss) for the nine months

ended September 30, 2021 was $23,531 as compared to ($101,096) for the nine months ended September 30, 2020.

The increase of the foreign

exchange gain is primarily due to holding cash balances in Canadian Dollars and the translation gain from using United Stated Dollars

as the reporting currency.

Foreign exchange gain for the three months ended March 31, 2022 was

a gain of $56,661 as compared to a gain of $44,964 for the three months ended March 31, 2021.

The change of the foreign exchange gain

of $11,697 is primarily due to from holding assets in Canadian Dollars during a period when the currency appreciated and the translation

gain from using United States Dollars as the reporting currency.

Liquidity and Capital Resources

The Company’s cash balance as of September

30, 2021 was $4,445,103.

The Company’s cash position is highly dependent on its ability to raise capital through the issuance of

debt and equity and its management of expenditures for mining development and for fulfillment of its public company reporting responsibilities.

Management believes that in order to finance the development of the mining properties and Kinetic Separation, the Company will be required

to raise additional capital by way of debt and/or equity.

The Company could potentially require additional capital if the scope of the

Sunday Mine Complex expands.

This outlook is based on the Company’s current financial position and is subject to change if opportunities

become available based on current exploration program results and/or external opportunities.

The Company’s cash balance as of March 31, 2022 was $2,798,217.

The Company’s cash position is highly dependent on its ability to raise capital through the issuance of debt and equity and its

management of expenditures for mining development and for fulfillment of its public company reporting responsibilities.

Management believes

that in order to finance the development of the mining properties and Kinetic Separation, the Company will be required to raise additional

capital by way of debt and/or equity.

Western could potentially require additional capital if the scope of Company’s projects expands.

This outlook is based on the Company’s current financial position and is subject to change if opportunities become available based

on current exploration program results and/or external opportunities.

Net cash used in operating activities

Net cash used in operating activities was $1,576,627

for the nine months ended September 30, 2021, as compared with $1,236,238 for the nine months ended September 30, 2020.

Of the $1,576,627

in net cash used in operating activities for the nine months ended September 2021, $1,596,717 is derived from our net loss before non-cash

This was offset by non-cash adjustments of $8,564 in depreciation, $5,983 for accretion of our reclamation liability, and

$542 in unrealized loss on our marketable securities.

Changes in our operating assets and liabilities for the period include an increase

of $80,454 in prepaid expenses and other current assets, an increase of $133,920 in accounts payable and accrued expenses, and a decrease

Net cash used in operating activities was $1,080,087 for the three

months ended March 31, 2022, as compared with $283,482 for the three months ended March 31, 2021.

Of the $1,080,087 in net cash used in

operating activities for the three months ended March 31, 2022, $1,173,603 is derived from our net loss before non-cash adjustments.

in our operating assets and liabilities for the period primarily include an increase of $59,800 in prepaid expenses and other current

assets, a decrease of $195,338 in accounts payable and accrued expenses, a decrease of $146,177 in subscription payable, and a decrease

of $16,155 in deferred revenue.

Net cash used in investing activities

Net cash used in investing activities was $65,000

for the nine months ended September 30, 2021, as compared with $0 for the nine months ended September 30, 2020.

This capital expenditure

relates to purchasing property and equipment for our mining operations.

Net cash used in investing activities was $369,900 for the three months

ended March 31, 2022, as compared with $65,000 for the three months ended March 31, 2021.

This capital expenditure relates to purchasing

property and equipment for our mining operations.

Net cash provided by financing activities

Net cash provided by financing activities for

the nine months ended September 30, 2021 and 2020 were $5,519,337 and $73,116, respectively.

The Company completed two private placements

during the first quarter of 2021 representing aggregate net proceeds of $3,869,306 and received $1,650,031 from the exercise of warrants

during the nine months ended September 30, 2021.

Net cash provided by financing activities for the three months ended

March 31, 2022 and 2021 were $3,353,728 and $3,869,306, respectively.

The Company completed a private placement during the first quarter

of 2022 representing aggregate net proceeds of $3,011,878 and received $341,850 from the exercise of warrants during the three months

ended March 31, 2022.

Reclamation Liability

7 unchanged sentences

The Company determined the gross reclamation liabilities of the mineral properties as

of September 30, 2021 and December 31, 2020, to be approximately $896,833 and $906,811, respectively.

of March 31, 2022 and December 31, 2021, to be approximately $740,446 and $740,446, respectively.

On March 2, 2020, the Colorado Mined

Land Reclamation Board (“MLRB”) issued an order vacating the Van 4 Temporary Cessation, terminating mining operations and

ordering commencement of final reclamation.

The Company has begun the reclamation of the Van 4 mine.

The reclamation cost is fully covered

by the reclamation bonds posted upon acquisition of the property.

The Company adjusted the fair value of its reclamation obligation for

the Van 4 mine.

The portion of the reclamation liability related to the Van 4 mine and its related restricted cash are included in current

liabilities and current assets, respectively, at a value of $75,057.

The Company expects to begin incurring the reclamation liability

after 2054 for all mines that are not in reclamation and accordingly, has discounted the gross liabilities over their remaining lives

using a discount rate of 5.4%.

The net discounted aggregated values as of September 30, 2021 and December 31, 2020 were $315,923 and $309,940,

respectively.

The gross reclamation liabilities as of September 30, 2021 and December 31, 2020 are secured by financial warranties in

the amount of $896,833 and $906,811, respectively.

During the first quarter 2021, the Company received

notice that its Ferris Haggerty property was no longer considered to be subject to reclamation treatment.

The Company recorded a discontinuation

of the Ferris Haggerty property’s present value of $2,669 during the first quarter 2021.

On April 29, 2021, the Company removed

the portion of the restricted cash related to the Ferris Haggerty property into its cash account for a total of $10,000.

Land Reclamation Board (“MLRB”) issued an order commencing final reclamation.

The Company has begun the reclamation of the

Van 4 Mine and the reclamation cost is fully covered by the reclamation bonds posted upon acquisition of the property.

The Company adjusted

the fair value of its reclamation obligation for the Van 4 Mine and moved the portion of the reclamation liability related to the Van

4 Mine and its related restricted cash into current liabilities and current assets, respectively, at a value of $75,057.

The Company expects

to begin incurring the reclamation liability after 2054 for all mines that are not in reclamation and accordingly, has discounted the

gross liabilities over their remaining lives using a discount rate of 5.4%.

The net discounted aggregated values as of March 31, 2022

and December 31, 2021 were $274,197 and $271,620, respectively.

The gross reclamation liabilities as of March 31, 2022 and December 31,

2021 are secured by financial warranties in the amount of $740,446 and $740,446, respectively.

Oil and Gas Lease and Easement

The Company entered into an oil and gas lease that became effective

with respect to minerals and mineral rights owned by the Company of approximately 160 surface acres of the Company’s property in

As consideration for entering into the lease, the lessee has agreed to pay the Company a royalty from the lessee’s revenue

attributed to oil and gas produced, saved, and sold attributable to the net mineral interest.

The Company has also received cash payments

from the lessee related to the easement that the Company is recognizing incrementally over the eight year term of the easement.

On June 23, 2020, the same entity as discussed above elected to extend

the oil and gas lease easement for three additional years, commencing on the date the lease would have previously expired.

the operator completed all well development stages and each of the eight (8) Blue Teal Fed wells commenced oil and gas production by mid-August

During the years ended March 31, 2022 and 2021 the Company recognized

aggregate revenue of $156,226 and $16,155, respectively, under these oil and gas lease arrangements.

On January 31, 2022, the operator

of the Weld County Colorado oil and gas pooled trust issued the first cumulative royalty payment check in the amount of $207,552 for August

2021 through December 2021 sales which was recognized as income in the fourth quarter of 2021.

Subsequently, in 2022, monthly royalty

checks were received for sales during each of the months in the first quarter.

Related Party Transactions

The Company has transacted with related parties

pursuant to service arrangements in the ordinary course of business, as follows:

The Company has transacted with related parties pursuant to service

arrangements in the ordinary course of business, as follows:

Prior to the acquisition of Black Range, Mr.

Glasier, the Company’s CEO, who is also a director (“Seller”), transferred his interest in a former joint venture with

Ablation Technologies, LLC to Black Range.

In connection with the transfer, Black Range issued 25 million shares of Black Range common

stock to Seller and committed to pay AUD $500,000 (USD $360,720 as of September 30, 2021) to Seller within 60 days of the first commercial

application of the kinetic separation technology.

Western assumed this contingent payment obligation in connection with the acquisition

of Black Range.

At the date of the acquisition of Black Range, this contingent obligation was determined to be probable.

Since the deferred

contingent consideration obligation is probable and the amount is estimable, the Company recorded the deferred contingent consideration

as an assumed liability in the amount of $360,720 and $392,086 as of September 30, 2021 and December 31, 2020, respectively.

George Glasier, the Company’s

CEO, who is also a director of the Company (“Seller”), transferred his interest in a former joint venture with Ablation Technologies,

LLC to Black Range.

In connection with the transfer, Black Range issued 25 million shares of Black Range common stock to Seller and committed

to pay AUD $500,000 (USD $374,499 as of March 31, 2022) to Seller within 60 days of the first commercial application of the Kinetic Separation

Western assumed this contingent payment obligation in connection with the acquisition of Black Range.

At the date of the acquisition

of Black Range, this contingent obligation was determined to be probable.

Since the deferred contingent consideration obligation is probable

and the amount is estimable, the Company recorded the deferred contingent consideration as an assumed liability in the amount of $374,499

and $362,794 as of March 31, 2022 and December 31, 2021, respectively.

Going Concern

The Company has incurred continuing losses from

its operations and as of September 30, 2021, the Company had an accumulated deficit of $12,684,176 and working capital of $4,004,375.

Since inception, the Company has met its liquidity

requirements principally through the issuance of notes and the sale of its common shares.

On February 16, 2021, the Company closed on

a non-brokered private placement of 3,250,000 units at a price of CAD $0.80 per unit.

The aggregate gross proceeds raised in the private

placement amounted to CAD $2,600,000 (USD $1,950,509 in net proceeds).

On March 1, 2021, the Company closed on a non-brokered private

placement of 3,125,000 units at a price of CAD $0.80 per unit.

The aggregate gross proceeds raised in the private placement amounted to

CAD $2,500,000 (USD $1,918,797 in net proceeds).

During the nine months ended September 30, 2021, the Company received $1,650,031 in proceeds

from the exercise of warrants.

The Company’s ability to continue its operations

and to pay its obligations when they become due is contingent upon the Company obtaining additional financing.

Management’s plans

include seeking to procure additional funds through debt and equity financings, securing regulatory approval to fully utilize its Kinetic

Separation, and initiating the processing of ore to generate operating cash flows.

There are no assurances that the Company will

be able to raise capital on terms acceptable to the Company or at all, or that cash flows generated from its operations will be sufficient

to meet its current operating costs and required debt service.

If the Company is unable to obtain sufficient amounts of additional capital,

it may be required to reduce the scope of its planned product development, which could harm its financial condition and operating results,

or it may not be able to continue to fund its ongoing operations.

These conditions raise substantial doubt about the Company’s ability

to continue as a going concern to sustain operations for at least one year from the issuance of the accompanying financial statements.

The accompanying condensed consolidated financial statements do not include any adjustments that might result from the outcome of these

uncertainties.

The Company has incurred continuing losses from its operations and

as of March 31, 2022, the Company had an accumulated deficit of $14,335,099 and working capital of $6,849,079.

Since inception, the Company has met its liquidity requirements principally

through the issuance of notes and the sale of its common shares.

On January 20, 2022, the Company closed on a non-brokered private placement

of 2,495,575 units at a price of CAD $1.60 per unit.

The aggregate gross proceeds raised in the private placement amounted to CAD $3,992,920

(USD $3,011,878 in net proceeds).

During the three months ended March 31, 2022, the Company received $341,850 in proceeds from the exercise

The Company’s ability to continue its operations and to pay its

obligations when they become due is contingent upon the Company obtaining additional financing.

Management’s plans include seeking

to procure additional funds through debt and equity financings, to secure regulatory approval to fully utilize its Kinetic Separation

and to initiate the processing of ore to generate operating cash flows.

There are no assurances that the Company will be able to raise capital

on terms acceptable to the Company or at all, or that cash flows generated from its operations will be sufficient to meet its current

operating costs and required debt service.

If the Company is unable to obtain sufficient amounts of additional capital, it may be required

to reduce the scope of its planned product development, which could harm its financial condition and operating results, or it may not

be able to continue to fund its ongoing operations.

These conditions raise substantial doubt about the Company’s ability to continue

as a going concern to sustain operations for at least one year from the issuance of the accompanying financial statements.

The accompanying

condensed consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties.

Off Balance Sheet Arrangements

As of September 30, 2021, there were no off-balance

sheet transactions.

The Company has not entered into any specialized financial agreements to minimize its investment risk, currency risk,

or commodity risk.

As of March 31, 2022, there were no off-balance sheet transactions.

The Company has not entered into any specialized financial agreements to minimize its investment risk, currency risk or commodity risk.

Critical Accounting Estimates and Policies

The preparation of these condensed consolidated

financial statements requires management to make certain estimates, judgments, and assumptions that affect the reported amounts of assets

and liabilities at the date of the condensed consolidated financial statements and reported amounts of expenses during the reporting period.

The preparation of these condensed consolidated financial statements

requires management to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities at

the date of the condensed consolidated financial statements and reported amounts of expenses during the reporting period.

Significant assumptions about the future and other

2 unchanged sentences

limited to, the following:

valuation of fair value of transactions involving common shares, assessment of the useful life and evaluation

for impairment of intangible assets, valuation and impairment assessments on mineral properties, deferred contingent consideration, the

reclamation liability, valuation of stock-based compensation, valuation of available-for-sale securities and valuation of long-term debt,

HST, and asset retirement obligations.

Other areas requiring estimates include allocations of expenditures, depletion, and amortization

of mineral rights and properties.

fair value of transactions involving common shares, assessment of the useful life and evaluation for impairment

of intangible assets, valuation and impairment assessments on mineral properties, deferred contingent consideration, the reclamation liability,

valuation of stock-based compensation, valuation of available-for-sale securities and valuation of long-term debt, HST and asset retirement

Other areas requiring estimates include allocations of expenditures, depletion and amortization of mineral rights and properties

Quantitative and Qualitative Disclosures

2 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis