Dakota Gold Corp

Previous wording

The Homestake District has yielded approximately 44.6 million ounces of gold production as of March 31, 2024 with most of it coming from within a small geographic area. The production ledges of the Homestake Mine define a cumulative surface projection area of less than three square miles. Homestake Mining Company's historic gold production and exploration in the Homestake District was overwhelmingly focused on the underground mine. Modern statistical studies of ore deposit trends and understanding of the distribution of large gold camps around the world indicates that large gold deposits generally form in distinct camps and normally occur in clusters that show predictable distributions (Zipf's Law Applied to Ore Deposits). The Company believes this might be true for the Homestake District. Outside of the mine area, the Homestake District has been underexplored and heretofore has not been the subject of modern exploration efforts required to search for other deposits, especially under the cover of younger rocks that dominate the surface.

Current wording

The Homestake District has historically yielded approximately 44.6 million ounces of gold production as of June 30, 2024 with most of it coming from within a small geographic area. The production ledges of the Homestake Mine define a cumulative surface projection area of less than three square miles. Homestake Mining Company's historic gold production and exploration in the Homestake District was overwhelmingly focused on the underground mine. Modern statistical studies of ore deposit trends and understanding of the distribution of large gold camps around the world indicates that large gold deposits generally form in distinct camps and normally occur in clusters that show predictable distributions (Zipf's Law Applied to Ore Deposits). The Company believes this might be true for the Homestake District. Outside of the mine area, the Homestake District has been underexplored and heretofore has not been the subject of modern exploration efforts required to search for other deposits, especially under the cover of younger rocks that dominate the surface.

Previous wording

Other than mineral resource estimate with an effective date of October 5, 2023 contained in our inaugural technical report summary for the Richmond Hill property, none of our other properties are sufficiently drilled to prepare an estimate of mineral resources under S-K 1300. The Company believes the Homestake District is in a safe, low-cost jurisdiction with well-developed infrastructure and is in a favorable regulatory environment in which authorities have consistently demonstrated a willingness to work with responsible operators to permit well-planned compliant projects.

Current wording

Other than our mineral resource estimate with an effective date of October 5, 2023 contained in our inaugural technical report summary for the Richmond Hill property, none of our other properties are sufficiently drilled to prepare an estimate of mineral resources under S-K 1300. The Company believes the Homestake District is in a safe, low-cost jurisdiction with well-developed infrastructure and is in a favorable regulatory environment in which authorities have consistently demonstrated a willingness to work with responsible operators to permit well-planned compliant projects.

Previous wording

Dakota Gold completed 24 holes for 78,040 feet (23,787 meters) of core drilling on three projects in 2022. The areas drilled were the Maitland Project, the Richmond Hill Project, and the Cambrian Unconformity Project. The Company also completed 89 holes for 174,659 feet (52,992 meters) of core on two projects in 2023; the areas drilled were the Maitland Gold Project (78,589 feet; 23,954 meters) and the Richmond Hill Project (96,070 feet; 29,282 meters). In total, Dakota Gold has completed 113 drill holes for 252,699 feet (77,023 meters) since drilling started in 2022.

Current wording

In total, Dakota Gold has completed 145 drill holes for 318,836 feet (97,181 meters) since drilling started in 2022. The Company completed 24 holes for 78,339 feet (23,878 meters) of core drilling on three projects in 2022. The areas drilled were the Maitland Project (44,710 feet; 13,628 meters), the Richmond Hill Project (27,503 feet; 8,383 meters), and the Cambrian Unconformity Project (6,126 feet; 1,867 meters). The Company then completed 89 holes for 174,659 feet (53,236 meters) of core on two projects in 2023; the areas drilled were the Maitland Gold Project (78,589 feet; 23,954 meters) and the Richmond Hill Project (96,070 feet; 29,282 meters). The Company has also completed 32 holes for 65,837 feet (20,067 meters) of core on two projects in the first half of 2024; the areas drilled were the Maitland Gold Project (59,073 feet; 18,006 meters) and the Richmond Hill Project 6,764 feet; 2,062 meters).

Previous wording

On February 8, 2023, the Company announced the discovery of the Unionville Zone in MA22C-009, which intercepted mineralized, Precambrian hosted, Tertiary-age, epithermal gold mineralization in a structurally controlled breccia. On May 4, 2023, the Company announced the discovery of the JB Zone in MA23C-017, which intercepted significant high-grade, Homestake-type, Precambrian mineralization over potentially mineable widths that has since been followed up with multiple gold intercepts in multiple limbs of Homestake iron formation, the geometry of which is analogous to the West-Ledge system at the Homestake Mine.

Current wording

On February 8, 2023, the Company announced the discovery of the Unionville Zone in MA22C-009, which intercepted mineralized, Precambrian hosted, Tertiary-age, epithermal gold mineralization in a structurally controlled breccia. On May 4, 2023, the Company announced the discovery of the JB Zone in MA23C-017, which intercepted significant high-grade, Homestake-type, Precambrian mineralization over potentially mineable widths that has since been followed up with multiple gold intercepts in multiple limbs of Homestake iron formation, the geometry of which is analogous to the West-Ledge system at the Homestake Mine. The Company continues to intersect both Homestake-type and Unionville Zone-type mineralization and released drilling and assay results in press releases on May 23, 2024, June 20, 2024, and on July 9, 2024.

Previous wording

The Company's planned activities in fiscal 2024 will be focused on advancing exploration and resources development drilling on its Maitland and Richmond Hill projects. Additional field work, specifically data compilation, sampling and mapping, are planned for Dakota Gold's West Corridor, Blind Gold and Poorman Anticline properties during the 2024 field season.

Current wording

The Company's planned activities in fiscal 2024 will be focused on advancing exploration and resources development drilling on its Maitland and Richmond Hill projects. Additional field work, specifically data compilation, sampling and mapping, are planned for Dakota Gold's West Corridor, Blind Gold and Poorman Anticline properties in 2024.

Previous wording

At Maitland, infill and step out drilling will continue in the JB and Unionville discovery areas for both Precambrian and Tertiary-age gold mineralization with the goal of completing an initial resource estimation for the Unionville system in 2025.

Current wording

At Maitland, infill and step out drilling will continue in the JB and Unionville discovery areas for both Precambrian and Tertiary-age gold mineralization with the goal of completing initial resource estimations for these systems in the future.

Previous wording

With four drill rigs operating at the Black Hills Property, the Company anticipates expenditures of approximately $30 million during the calendar year ending December 31, 2024. To fund expenditures at this level, the Company will be required to raise further capital. Should it be unable to raise capital, the Company can scale down the exploration program to maintain greater than 12 months of funding as of March 31, 2025.

Current wording

With four drill rigs operating at the Black Hills Property, the Company anticipates expenditures of approximately $30 million during the calendar year ending December 31, 2024. To fund expenditures at this level, the Company will be required to raise further capital. Should it be unable to raise sufficient capital, the Company plans to scale down the exploration program to maintain greater than 12 months of funding from the date of these financial statements.

Previous wording

The Company is in the exploration stage and currently does not generate revenues. As such, the Company finances its operations and the acquisition and exploration of its mineral properties through the issuance of common stock, and the Company could be materially adversely affected if it is unable to raise capital because of market or other factors.

Current wording

The Company is in the exploration stage and currently does not generate revenue. As such, the Company finances its operations and the acquisition and exploration of its mineral properties through the issuance of common stock, and the Company could be materially adversely affected if it is unable to raise capital because of market or other factors.

Previous wording

As of March 31, 2024, the Company had working capital of approximately $12.22 million and a retained deficit of approximately $51.26 million. The Company had a net loss for the three months ended March 31, 2024, of approximately $8.59 million.

Current wording

As of June 30, 2024, the Company had working capital of approximately $10.66 million and a retained deficit of approximately $60.41 million. The Company had a net loss for the six months ended June 30, 2024, of approximately $17.75 million.

Previous wording

During the twelve months ending December 31, 2024, the Company anticipates cash expenditures of approximately $30 million.

Current wording

During the twelve months ending December 31, 2024, the Company anticipates cash expenditures of approximately $34 million.

Previous wording

Based on the Company's cash balance at March 31, 2024 of approximately $15.11 million and the anticipated ability to utilize the ATM program during the year, the Company believes that it will have sufficient funds to fund its activities for the next twelve months. The actual timing of expected expenditures and fundraising is dependent upon a number of factors, including the management of variable exploration expenditures.

Current wording

Based on the Company's cash balance at June 30, 2024 of approximately $16.08 million and the anticipated ability to utilize the ATM program during the year, the Company believes that it will have sufficient funds to fund its activities for the next twelve months. The actual timing of expected expenditures and fundraising is dependent upon several factors, including the management of variable exploration expenditures.

Previous wording

Should it be unable to raise sufficient capital, the Company plans to scale down the exploration program in order to maintain greater than 12 months of funding from the date of these financial statements.

Current wording

Should it be unable to raise sufficient capital, the Company plans to scale down the exploration program to maintain greater than 12 months of funding from the date of these financial statements.

Previous wording

The Company had losses from operations for the three months ended March 31, 2024 and 2023 totaling approximately $8.79 million and $9.58 million, respectively, losses before income tax of approximately $8.61 million and $9.54 million respectively, leading to net losses of approximately $8.59 million and $9.27 million.

Current wording

The Company had losses from operations for the quarters ended June 30, 2024 and 2023 totaling approximately $9.23 million and $10.18 million, respectively, losses before income tax of approximately $9.16 million and $10.14 million respectively, leading to net losses of approximately $9.15 million and $9.82 million.

Previous wording

During the three months ended March 31, 2024 and 2023, exploration expenses totaled approximately $6.55 million and $6.84 million, respectively. The Company's main driver for exploration expenditure relates to the number of drills operating at our projects. While the Company had four drills operating during both periods, the Company has improved cost efficiency. The Company also took a longer shutdown over late December 2023 and early January 2024, which reduced drilling and related costs including assays and core cutting. Partially offsetting the reduction in drilling costs were higher study costs relating to the completion of the technical report summary for the Richmond Hill property. Included in exploration costs were non-cash exploration-related stock-based compensation expenses of approximately $0.13 million and $0.20 million for the three months ended March 31, 2024 and 2023, respectively.

Current wording

During the six months ended June 30, 2024 and 2023, exploration expenses totaled approximately $12.97 million and $14.44 million, respectively. The Company's main driver for exploration expenditure relates to the number of drills operating at our projects. While the Company alternated between three and four drills in operation during both periods, the Company has improved cost efficiency. The Company also took a longer drilling during January 2024 in comparison to 2023, which reduced drilling and related costs including assays and core cutting. Partially offsetting the reduction in drilling costs were higher study costs relating to the completion of the technical report summary for the Richmond Hill property. Included in exploration costs were non-cash exploration-related stock-based compensation expenses of approximately $0.31 million and $0.41 million for the six months ended June 30, 2024 and 2023, respectively.

Previous wording

Our general and administrative expenses for the three months ended March 31, 2024 and 2023, were approximately $2.25 million and $2.74 million, respectively. These expenditures were primarily for legal, accounting, and professional fees, investor relations, and other general and administrative expenses necessary for our operations. The decrease was primarily due to decreased stock-based compensation allocated to administration expenses of $0.67 million for the three months ended March 31, 2024 (compared to approximately $1.09 million for the three months ended March 31, 2023) and decreased support costs included in general and administrative costs of approximately $1.15 million for the three months ended March 31, 2024 (compared to $1.45 million for the three months ended March 31, 2023), partially offset by increased investor relations expenses of approximately $0.19 million for the three months ended March 31, 2024 (compared to approximately $0.03 million for the three months ended March 31, 2023).

Current wording

Our general and administrative expenses for the six months ended June 30, 2024 and 2023, were approximately $5.04 million and $5.32 million, respectively. These expenditures were primarily for legal, accounting, and professional fees, investor relations, and other general and administrative expenses necessary for our operations. The decrease was primarily due to decreased stock-based compensation allocated to administration expenses of $1.48 million for the six months ended June 30, 2024 (compared to approximately $2.14 million for the six months ended June 30, 2023), support costs included in general and administrative costs of approximately $2.49 million for the six months ended June 30, 2024 (compared to $2.68 million for the six months ended June 30, 2023) and consulting costs of approximately $0.03 million (compared to $0.05 million for the six months ended June 30, 2023), partially offset by increased investor relations expenses of approximately $0.55 million for the six months ended June 30, 2024 (compared to approximately $0.07 million for the six months ended June 30, 2023) as the Company increased investor related activities to support the capital raising through the ATM and announced the Orion financing (see note 1) and professional fees of approximately $0.37 million (compared to approximately $0.25 million for the six months ended June 30, 2023).

Previous wording

The Company earned interest income from bank accounts of approximately $0.22 million and $0.05 million and incurred interest expense of approximately $0.04 million and $Nil related to the VMC purchase for the three months ended March 31, 2024 and 2023, respectively.

Current wording

The Company earned interest income from bank accounts of approximately $0.35 million and $0.10 million and incurred interest expense of approximately $0.08 million and $Nil related to the VMC purchase for the six months ended June 30, 2024 and 2023, respectively.

Previous wording

During the three months ended March 31, 2024 and 2023, the Company's cash flows used in operating activities were approximately $10.17 million and $8.46 million, respectively. Cash used in operations for the three months ended March 31, 2024 increased period over period primarily as a result of timing of payments.

Current wording

During the six months ended June 30, 2024 and 2023, the Company's cash flows used in operating activities were approximately $15.86 million and $17.04 million, respectively. Cash used in operations decreased period over period as a result of the decrease in drilling expenditures between the two periods.

Previous wording

During the three months ended March 31, 2024 and 2023, cash flow used in investing activities were approximately $0.17 million and $0.07 million, respectively. In the three months ended March 31, 2024, the cash used in investing activities consisted of approximately $0.12 million for purchases of property and equipment, $0.03 million of mineral properties and $0.02 million of other assets. In the three months ended March 31, 2023, the cash used in investing activities consisted of approximately $0.04 million for purchases of property and equipment, $0.02 million of mineral properties and $0.01 million of other assets. The increase in property acquisition costs was due to the timing of acquisitions. The higher acquisition of property and equipment in the three months ended March 31, 2023 related to the completion of the new core storage facility.

Current wording

During the six months ended June 30, 2024 and 2023, cash flow used in investing activities were approximately $0.40 million and $0.58 million, respectively. In the six months ended June 30, 2024, cash used in investing activities consisted of approximately $0.14 million for purchases of property and equipment and $0.25 million for mineral properties. In the six months ended June 30, 2023, the cash used in investing activities consisted of approximately $0.48 million for purchases of property and equipment and $0.10 million for purchases of mineral properties. The decrease in property acquisition costs was due to the timing of acquisitions and the use of shares instead of cash for the purchase of the VMC property during the period and the higher acquisition of property and equipment in the six months ended June 30, 2023 related to the completion of the Company's new core storage facility.