Equinox Gold Corp. (Form: 6-K, Received: 03/23/2022 17:24:24)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of March, 2022.

Commission File Number 001-39038

EQUINOX GOLD CORP.

(Translation of registrant’s name into English)

700 West Pender Street, Suite 1501, Vancouver, British Columbia, V6C 1G8

(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F. Form 20-F Form 40-F x

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ____

Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country

exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Equinox Gold Corp.

Date:

March 23, 2022

By:

/s/ Susan Toews

Name: Susan Toews

Title: General Counsel


Index to Exhibits
99.1			Financial Statements
99.2			Management Discussion & Analysis

Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Expressed in thousands of United States dollars, unless otherwise stated)

Consolidated Financial Statements

For the years ended December 31, 2021 and 2020


CONTENTS
Management's Report			3
Report of Independent Registered Public Accounting Firm – Consolidated Financial Statements			4
Report of Independent Registered Public Accounting Firm – Internal Control over Financial Reporting			4
Consolidated Statements of Financial Positio n			6
Consolidated Statements of Income			7
Consolidated Statements of Comprehensive Income			8
Consolidated Statements of Cash Flows			9
Consolidated Statements of Changes in Equity			10

Notes to the Consolidated Financial Statements
Note 1 – Nature of o perations			11
Note 2 – Basis of p reparation			11
Note 3 – Significant a ccounting p olicies			12
Note 4 – Areas of s ignificant j udg e ment and e stimation u ncertaint y			24
Note 5 – C orporate t ransactions			27

Consolidated Statements of Financial Position
Note 6 – Marketable s ecurities			32
Note 7 – Trade and o ther r eceivables			32
Note 8 – Inventor ies			32
Note 9 – Assets h eld f or s ale			33
Note 10 – Mineral p roperties, p lant and e quipment			35
Note 11 – Investment in a ssociate			36
Note 12 – Other non-current assets			38
Note 1 3 – Accounts p ayable and a ccrued l iab ilities			39
Note 1 4 – Loans and b orrowings			39
Note 1 5 – Derivative f inancial i nst ruments			41
Note 1 6 – Reclamation and c losure c ost p rovision			46
Note 1 7 – Other non-current liabilities			46
Note 1 8 – Leases			47
Note 1 9 – Share capital and share-based payments			47
Note 20 – Reserves			52

Consolidated Statements of Income
Note 2 1 – Revenue			53
Note 2 2 – Operating expense			53
N ote 2 3 – Care and maintenance expense			53
Note 2 4 – General and administrative expense			54
Note 2 5 – Other income (expense)			54
Note 2 6 – Income taxes			55
N ote 2 7 – Net income per share			57

Other Disclosures
Note 2 8 – Segment information			58
N ote 2 9 – Related party transactions			59
N ote 30 – Supplemental cash flow information			60
Note 3 1 – Financial instruments and f air value measurement s			60
N ote 3 2 – Financial instrument risks and risk management			62
Note 3 3 – Capital management			65
Note 3 4 – Contingencies and other risks			66

Management’s Responsibility for Financial Reporting

The accompanying consolidated financial statements of Equinox Gold Corp. and subsidiaries (“Equinox Gold” or the “Company”) and all the information in this annual report are the responsibility of management and have been approved by the Board of Directors.

The consolidated financial statements have been prepared by management on a going concern basis in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). Financial statements are not exact since they include certain amounts based on estimates and judgements. Management has determined such amounts on a reasonable basis to ensure that the financial statements are presented fairly, in all material respects. Management has prepared the financial information presented elsewhere in the annual report and has ensured that it is consistent with that in the consolidated financial statements.

Equinox Gold maintains systems of internal accounting and administrative controls to provide, on a reasonable basis, assurance that the financial information is relevant, reliable and accurate and that the Company’s assets are appropriately accounted for and adequately safeguarded. The Company’s internal control over financial reporting as of December 31, 2021, is based on the criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

The Board of Directors is responsible for ensuring that management fulfills its responsibilities for financial reporting and is ultimately responsible for reviewing and approving the financial statements. The Board of Directors carries out this responsibility principally through its Audit Committee (“Committee”).

The Committee is appointed by the Board of Directors, and all of its members are independent directors. The Committee meets at least four times a year with management, as well as the external auditors, to discuss internal controls over financial reporting, auditing matters and financial reporting issues, to satisfy itself that each party is properly discharging its responsibilities, and to review the quarterly and the annual consolidated financial statements, management’s discussion and analysis and the external auditors’ reports. The Committee reports its findings to the Board of Directors for consideration when approving the consolidated financial statements for issuance to the Company's shareholders. The Committee also considers, for review by the Board of Directors and approval by the shareholders, the engagement or reappointment of the external auditors.

The consolidated financial statements have been audited by KPMG LLP, an independent registered public accounting firm, in accordance with the standards of the Public Company Accounting Oversight Board (United States) on behalf of the shareholders. KPMG LLP has full and free access to the Committee.


/s/ Christian Milau			/s/ Peter Hardie

Christian Milau			Peter Hardie
Chief Executive Officer			Chief Financial Officer

March 23, 2022


			KPMG LLP Chartered Professional Accountants PO Box 10426 777 Dunsmuir Street Vancouver BC V7Y 1K3 Canada			Telephone Fax Internet			(604) 691-3000 (604) 691-3031 www.kpmg.ca

Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Directors Equinox Gold Corp.

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated statements of financial position of Equinox Gold Corp. (the Company) as of December 31, 2021 and 2020, the related consolidated statements of income, comprehensive income, cash flows and changes in equity for the years then ended, and the related notes (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2021 and 2020, and the results of its operations and its cash flows for the years then ended, in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2021, based on the criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated March 23, 2022 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing separate opinions on the critical audit matter or on the accounts or disclosures to which it relates.

Fair value of the mineral properties acquired as part of the Premier Gold Mines Limited acquisition

As discussed in Note 5(a) to the consolidated financial statements, on April 7, 2021 the Company acquired 100% of the issued and outstanding shares of Premier Gold Mines Limited (Premier) for consideration of $408,273 thousand. The transaction was accounted for as a business combination. In allocating the purchase consideration to the acquired assets and liabilities, $576,803 thousand was allocated to mineral properties, plant and equipment. The fair value of mineral properties, plant and equipment was based on comparable transactions.

We identified the evaluation of the fair value of mineral properties, plant and equipment acquired in the Premier acquisition as a critical audit matter. The evaluation of the fair value of mineral properties, plant and equipment required a high degree of auditor judgment, subjectivity and audit effort including the involvement of professionals with specialized skill and knowledge.

The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of certain internal controls related to the process for determining the fair value of assets and liabilities acquired in a business combination. This included controls related to the Company’s process for estimating the fair value of the acquired mineral properties, plant and equipment. We assessed the appropriateness and implied value of comparable transactions, including the value of any contingent consideration by comparing to publicly available data or agreeing to a purchase and sale agreement. We also assessed the appropriateness of the fair value of the Mercedes Mine estimated through a discounted cash flow approach. We compared the future production costs and capital expenditures in the discounted cash flow models to third party technical reports and to actual historical costs incurred. We evaluated the Company’s estimate of mineral reserves and resources by comparing the estimates to third party technical reports and actual historical production. We involved valuation professionals with specialized skills and knowledge, who assisted in:

–Evaluating the future gold prices by comparing to third-party data; and

–Evaluating the Company’s discount rates by comparing them against a discount rate range that was independently developed using publicly available market data for comparable entities.

/s/ KPMG LLP

Chartered Professional Accountants

We have served as the Company’s auditor since 2016.

Vancouver, Canada

March 23, 2022


			KPMG LLP Chartered Professional Accountants PO Box 10426 777 Dunsmuir Street Vancouver BC V7Y 1K3 Canada			Telephone Fax Internet			(604) 691-3000 (604) 691-3031 www.kpmg.ca

Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Directors Equinox Gold Corp.

Opinion on Internal Control Over Financial Reporting

We have audited Equinox Gold Corp.’s (the Company) internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Company has maintained effective internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated statements of financial position of the Company as of December 31, 2021 and 2020, the related consolidated statements of income and comprehensive income, cash flow and changes in equity, for the years then ended, and the related notes (collectively, the consolidated financial statements), and our report dated March 23, 2022 expressed an unqualified opinion on those consolidated financial statements.

The Company acquired Premier Gold Mines Limited during 2021, and, except for controls over purchase price adjustments related to the acquisition, management excluded from its assessment of the effectiveness of the Company’s internal control over financial reporting as of December 31, 2021, Premier Gold Mines Limited’s internal control over financial reporting associated with total revenues of $56.9 million, net loss of $0.1 million, total current assets of $181.7 million, total non-current assets of $274.7 million, total current liabilities of $88.9 million and total non-current liabilities of $8.3 million included in the consolidated financial statements of the Company as of and for the year ended December 31, 2021. Our audit of internal control over financial reporting of the Company also excluded an evaluation of the internal control over financial reporting of Premier Gold Mines Limited during 2021.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Discussion Analysis under the heading “Management’s Report on Internal Controls Over Financial Reporting and Disclosure Controls and Procedures”. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control Over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ KPMG LLP

Chartered Professional Accountants

Vancouver, Canada

March 23, 2022

Consolidated Statements of Financial Position

At December 31, 2021 and 2020

(Expressed in thousands of United States dollars)


	Note	2021		2020
Assets
Current assets
Cash and cash equivalents		$	305,498	$	344,926
Marketable securities	6	240,530		3,120
Trade and other receivables	7	50,260		55,872
Inventories	8	201,622		208,290
Derivative assets	15(a)	124,234		—
Prepaid expenses and other current assets		33,549		33,816
Assets held for sale	9	207,538		—
		1,163,231		646,024
Non-current assets
Restricted cash		20,444		2,004
Inventories	8	124,265		130,888
Mineral properties, plant and equipment	10	2,497,919		1,858,723
Investment in associate	11	125,313		22,287
Deferred tax assets	26	10,576		—
Other non-current assets	12	25,613		13,474
Total assets		$	3,967,361	$	2,673,400

Liabilities and Equity
Current liabilities
Accounts payable and accrued liabilities	13	$	190,116	$	130,543
Current portion of loans and borrowings	14	26,667		13,333
Derivative liabilities	15(b)	77,699		63,993
Other current liabilities		22,339		14,795
Liabilities relating to assets held for sale	9	85,745		—
		402,566		222,664
Non-current liabilities
Loans and borrowings	14	514,015		531,908
Reclamation and closure cost provisions	16	95,565		117,103
Derivative liabilities	15(b)	7,158		90,573
Deferred tax liabilities	26	312,198		229,860
Other non-current liabilities	17	50,514		32,769
Total liabilities		1,382,016		1,224,877
Shareholders’ equity
Common shares	19(b)	2,006,777		1,518,042
Reserves	20	47,038		38,779
Accumulated other comprehensive income (“AOCI”)		84,939		—
Retained earnings (deficit)		446,591		(108,298)
Total equity		2,585,345		1,448,523
Total liabilities and equity		$	3,967,361	$	2,673,400

Commitments and contingencies (notes 10, 15(b)(v), 32(b) and 34)

The accompanying notes form an integral part of these consolidated financial statements.

Approved on behalf of the Board of Directors


“Ross Beaty”						“Lenard Boggio”
Director						Director

Consolidated Statements of Income

For the years ended December 31, 2021 and 2020

(Expressed in thousands of United States dollars, except share and per share amounts)


	Note	2021		2020(1)
Revenue	21	$	1,082,286	$	845,388
Cost of sales
Operating expense	22	(654,804)		(423,291)
Depreciation and depletion		(196,892)		(131,914)
		(851,696)		(555,205)
Income from mine operations		230,590		290,183
Care and maintenance expense	23	(15,274)		(64,995)
Exploration expense		(16,253)		(11,840)
General and administration expense	24	(52,590)		(40,392)
Income from operations		146,473		172,956
Finance expense		(41,551)		(39,751)
Finance income		2,816		1,819
Share of net income (loss) of associate	11	735		(5,388)
Other income (expense)	25	426,562		(86,537)
Income before taxes		535,035		43,099
Income tax recovery (expense)	26	19,854		(20,811)
Net income		$	554,889	$	22,288

Net income per share
Basic	27	$	1.95	$	0.10
Diluted	27	$	1.69	$	0.10
Weighted average shares outstanding
Basic	27	284,932,357		212,487,729
Diluted	27	333,734,701		218,411,971

(1) See note 3(u)(i)

The accompanying notes form an integral part of these consolidated financial statements.

Consolidated Statements of Comprehensive Income

For the years ended December 31, 2021 and 2020

(Expressed in thousands of United States dollars)


	Note	2021		2020
Net income		$	554,889	$	22,288
Other comprehensive income (“OCI”)
Items that may be reclassified subsequently to net income:
Foreign currency translation		(1,345)		—
Items that will not be reclassified subsequently to net income:
Net increase in fair value of marketable securities and other investments in equity instruments	6,12(b)	100,144		—
Income tax expense relating to change in fair value of marketable securities and other investments in equity instruments		(13,860)		—
Total OCI		84,939		—
Total comprehensive income		$	639,828	$	22,288

The accompanying notes form an integral part of these consolidated financial statements.

Consolidated Statements of Cash Flows

For the years ended December 31, 2021 and 2020

(Expressed in thousands of United States dollars)


	Note	2021		2020(1)
Cash provided by (used in):
Operating activities
Net income for the year		$	554,889	$	22,288
Adjustments for:
Depreciation and depletion		198,134		152,185
Finance expense		41,551		39,751
Change in fair value of derivatives	25	(90,643)		92,684
Settlements of derivatives	15(b)(i),(ii)	(46,308)		(35,809)
Gain on bargain purchase of Premier Gold Mines Limited	5(a)	(81,432)		—
(Gain) loss on disposal of assets	5(c),(d)	(81,970)		1,679
Gain on reclassification of investment in Solaris Resources Inc.	5(d)	(186,067)		—
Unrealized foreign exchange gain		(2,963)		(4,818)
Share-based compensation expense	19(d)	7,327		8,140
Income tax (recovery) expense	26	(19,854)		20,811
Income taxes paid		(24,934)		(32,788)
Other		(3,608)		6,848
Operating cash flow before non-cash changes in working capital		264,122		270,971
Non-cash changes in working capital	30	56,656		(15,193)
		320,778		255,778
Investing activities
Expenditures on mineral properties, plant and equipment		(344,224)		(174,753)
Acquisition of Premier Gold Mines Limited	5(a)	8,267		—
Investment in Greenstone Gold Mines LP	5(b)	(50,905)		—
Investment in i-80 Gold Corp.	11	(40,860)		—
Net proceeds on disposal of assets	5(c),(d)	90,478		6,500
Acquisition of Leagold Mining Corporation	5(e)	—		55,252
Investment in Solaris Resources Inc.	11	—		(12,480)
Other		(10,323)		(5,691)
		(347,567)		(131,172)
Financing activities
Draw down on Credit Facility	14(a)	—		379,680
Proceeds from issuance of Convertible Notes	14(b)	—		139,278
Transaction costs	14(a),(b)	—		(10,622)
Repayment of loans and borrowings	14	(30,983)		(546,274)
Interest paid	14	(22,112)		(26,536)
Lease payments	18	(24,309)		(6,667)
Net proceeds from issuance of shares	19(b)	59,498		42,793
Proceeds from exercise of warrants and stock options	15(b)(iii),19(c)	17,655		171,530
Other		(1,344)		9,483
		(1,595)		152,665
Effect of foreign exchange on cash and cash equivalents		(6,469)		(61)
(Decrease) increase in cash and cash equivalents		(34,853)		277,210
Cash and cash equivalents – beginning of year		344,926		67,716
Cash and cash equivalents – end of year		$	310,073	$	344,926
Cash and cash equivalents reclassified as held for sale	9	(4,575)		—
Cash and cash equivalents, excluding amounts classified as held for sale – end of year		$	305,498	$	344,926

(1) See notes 3(u)(i) and 3(u)(ii)

The accompanying notes form an integral part of these consolidated financial statements.

Consolidated Statements of Changes in Equity

For the years ended December 31, 2021 and 2020

(Expressed in thousands of United States dollars, except for share amounts)


		Common Shares
	Note	Number	Amount		Reserves (note 20)		AOCI		Retained Earnings (Deficit)		Total








Balance – December 31, 2019		113,452,363	$	505,686	$	27,959	$	—	$	(130,586)	$	403,059
Shares and options issued on acquisition of Leagold Mining Corporation	5(e)	94,635,765	732,042		19,777		—		—		751,819
Shares issued in private placements	19(b)	6,934,438	42,855		—		—		—		42,855
Equity component of Convertible Notes issued	14(b)	—	—		8,322		—		—		8,322
Shares issued on exercise of warrants and stock options, and settlement of RSUs and pRSUs	15(b)(iii), 19(c)	27,331,840	237,521		(22,104)		—		—		215,417
Share-based compensation	19(d)	—	—		4,825		—		—		4,825
Share issue costs		—	(62)		—		—		—		(62)
Net income and total comprehensive income		—	—		—		—		20,720		20,720
Balance – December 31, 2020 (as previously reported)		242,354,406	1,518,042		38,779		—		(109,866)		1,446,955
Adjustment on initial application of IAS 16 amendment	3(u)(i)	—	—		—		—		1,568		1,568
Adjusted balance – December 31, 2020		242,354,406	1,518,042		38,779		—		(108,298)		1,448,523
Shares and options issued on acquisition of Premier Gold Mines Limited	5(a)	47,373,723	399,613		8,155		—		—		407,768
Shares issued in private placements	19(b)	7,500,000	59,595		—		—		—		59,595
Shares issued on exercise of warrants and stock options, and settlement of RSUs and pRSUs	15(b)(iii), 19(c)	4,096,475	29,624		(7,869)		—		—		21,755
Share-based compensation	19(d)	—	—		7,973		—		—		7,973
Share issue costs		—	(97)		—		—		—		(97)
Net income and total comprehensive income		—	—		—		84,939		554,889		639,828
Balance – December 31, 2021		301,324,604	$	2,006,777	$	47,038	$	84,939	$	446,591	$	2,585,345

The accompanying notes form an integral part of these consolidated financial statements.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

1. NATURE OF OPERATIONS

Equinox Gold Corp. (the “Company” or “Equinox Gold”) was incorporated under the Business Corporations Act of British Columbia on March 23, 2007. Equinox Gold’s primary listing is on the Toronto Stock Exchange (“TSX”) in Canada where its common shares trade under the symbol “EQX”. The Company’s shares also trade on the NYSE American Stock Exchange in the United States under the symbol “EQX”. The Company's corporate office is at Suite 1501, 700 West Pender Street, Vancouver, British Columbia, Canada, V6C 1G8.

Equinox Gold is a mining company engaged in the operation, acquisition, exploration and development of mineral properties, with a focus on gold.

On April 7, 2021, the Company completed the acquisition of Premier Gold Mines Limited (“Premier”) (the “Premier Acquisition”) (note 5(a)). The results of operations of Premier are included in these consolidated financial statements from April 7, 2021. On March 10, 2020, the Company completed its acquisition of Leagold Mining Corporation (“Leagold”) (the “Leagold Acquisition”) (note 5(e)). The results of operations of Leagold are included in these consolidated financial statements from March 10, 2020.

All of the Company’s principal properties are located in the Americas. The Company’s principal properties and material subsidiaries are as follows:

Subsidiary

Location

Principal Property

Principal Activity

Ownership Interest

Western Mesquite Mines, Inc.

USA

Mesquite Mine (“Mesquite”)

Production

100

Castle Mountain Venture

USA

Castle Mountain Mine (“Castle Mountain”)

Production

100

Desarrollos Mineros San Luis S.A. de C.V.

Mexico

Los Filos Mine Complex (“Los Filos”)

Production

100

Minera Mercedes Minerales, S. de. R.L. de C.V.

Mexico

Mercedes Mine (“Mercedes”)

Production

100

Mineração Aurizona S.A.

Brazil

Aurizona Mine (“Aurizona”)

Production

100

Fazenda Brasileiro Desenvolvimento Mineral Ltda

Brazil

Fazenda Mine (“Fazenda”)

Production

100

Mineração Riacho Dos Machados Ltda

Brazil

RDM Mine (“RDM”)

Production

100

Santa Luz Desenvolvimento Mineral Ltda

Brazil

Santa Luz project (“Santa Luz”)

Development

100

The Company also has a 60% interest in Greenstone Gold Mines LP, which is a joint operation that owns the Greenstone development project (“Greenstone”). On December 16, 2021, the Company entered into a definitive agreement to sell its Mercedes Mine and as at December 31, 2021, the assets and liabilities relating to Mercedes were classified as held for sale (note 9).

2. BASIS OF PREPARATION

(a)Statement of compliance

These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) issued by the International Accounting Standards Board (“IASB”). These consolidated financial statements were approved and authorized for issuance by the Board of Directors on March 23, 2022.

(b)Basis of measurement

These consolidated financial statements have been prepared on a historical cost basis except for certain financial instruments, which are measured at fair value.

(c)Basis of consolidation

These consolidated financial statements include the accounts of the Company, its subsidiaries and joint operation. Subsidiaries are entities controlled by the Company. Control is defined as Equinox Gold having power over the entity, exposure or rights to variable returns from its involvement with the entity, and the ability to use its power to affect the amount of returns. Joint operations are assets and liabilities that are jointly controlled with another party.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

2. BASIS OF PREPARATION (CONTINUED)

(c)Basis of consolidation (continued)

All intercompany transactions and balances, or in the case of the joint operation, the Company's share of such transactions and balances, are eliminated on consolidation.

(d)Presentation currency

Except as otherwise noted, these consolidated financial statements are presented in United States dollars (“US dollars” or “USD”). All references to C$ are to Canadian dollars (“CAD”).

(e)Functional currency, and foreign currency transactions and translation

(i)Functional currency

The functional currency of the Company and each of its subsidiaries and joint operation is determined by the currency of the primary economic environment in which the entity operates. The functional currency of the Company and its subsidiaries is the US dollar. The functional currency of the Company's joint operation, Greenstone, is the Canadian dollar.

(ii)Foreign currency transactions

Transactions in currencies other than the functional currency of an entity (“foreign currencies”) are initially recognized in the functional currency by applying the exchange rates prevailing at the date of the transaction. At the end of each reporting period: (i) monetary assets and liabilities denominated in foreign currencies are translated at the exchange rate prevailing at the date of the statement of financial position; and (ii) non-monetary assets and liabilities denominated in foreign currencies are translated at historical exchange rates, unless the item is measured at fair value, in which case it is translated at the exchange rate in effect at the date when the fair value was determined. Resulting foreign exchange gains and losses are recognized in net income or loss. Foreign currency gains and losses are reported on a net basis.

(iii)Foreign currency translation

The Company translates the results and financial position of Greenstone, which has a Canadian dollar functional currency, into the US dollar presentation currency using the following procedures:

•Assets and liabilities are translated at the exchange rate prevailing at the date of the statement of financial position;

•Revenues and expenses are translated at the exchange rates on the dates of the transactions, or at exchange rates that approximate the actual exchange rates, for example, the average exchange rate for the period; and

•Exchange gains and losses on translation are recognized in OCI.

(f)Comparative information

Certain comparative amounts have been reclassified to conform with the current year’s financial statement presentation. Such reclassifications were not considered material.

3. SIGNIFICANT ACCOUNTING POLICIES

(a)Business combinations

A business combination is an acquisition of assets and liabilities that constitute a business and whereby the Company obtains control of the business. A business is an integrated set of activities and assets that consist of inputs and processes, including a substantive process that, when applied to those inputs, have the ability to create or significantly contribute to the creation of outputs that generate investment income or other income from ordinary activities.

When acquiring a set of activities or assets in the exploration and development stage, which may not have outputs at the acquisition date, the Company considers other factors to determine whether the set of activities or assets is a business. In this case, an acquired process is considered substantive when: (i) the acquired process is critical to the ability to develop the acquired input into outputs; and (ii) the inputs acquired include both an organized workforce with the necessary skills, knowledge, or experience to perform the process and other inputs that the organized workforce could develop into outputs.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(a)Business combinations (continued)

Business combinations are accounted for using the acquisition method whereby identifiable assets acquired and liabilities assumed, including contingent liabilities, are recognized at their fair values at the acquisition date. The acquisition date is the date at which the Company obtains control over the acquiree, which is generally the date that consideration is transferred and the Company acquires control of the assets and assumes the liabilities of the acquiree. The Company considers all relevant facts and circumstances in determining the acquisition date.

The consideration transferred in a business combination is measured at fair value, which is calculated as the sum of the fair values, determined as at the acquisition date, of the assets transferred by the Company, the liabilities, including contingent consideration, incurred and payable by the Company to former owners of the acquiree and the equity interests issued by the Company. Acquisition-related costs, other than costs to issue debt or equity securities of the Company, are expensed as incurred.

A non-controlling interest (“NCI”), if any, represents the equity in a subsidiary not attributable, directly or indirectly, to the Company. An NCI is recognized at its proportionate share of the fair value of identifiable net assets acquired on initial recognition.

Goodwill, if any, is calculated as the sum of the total consideration transferred by the Company and the NCI in the acquiree, if any, less the fair value of net assets acquired. When the fair value of net assets acquired exceeds the sum of the total consideration transferred by the Company and the NCI in the acquiree, if any, the Company recognizes a bargain purchase gain in net income or loss on the acquisition date.

(b)Joint arrangements

A joint arrangement is an arrangement of which two or more parties have joint control, which is the contractually agreed sharing of control of an arrangement. This exists only when the decisions about the relevant activities (being those that significantly affect the returns of the arrangement) require the unanimous consent of the parties sharing control. A joint arrangement is classified as a joint operation or a joint venture based on the rights and obligations of the parties to the joint arrangement.

The Company's interest in Greenstone (notes 5(a) and 5(b)) is classified as a joint operation, whereby the parties that have joint control of the arrangement have rights to the assets and obligations for the liabilities relating to the arrangement. The Company proportionately consolidates its share of Greenstone's assets, liabilities, revenues and expenses.

(c)Cash and cash equivalents

Cash and cash equivalents consist mainly of cash on hand and cash held at banks. Cash equivalents are highly liquid investments with a maturity date of three months or less from the date of purchase.

(d)Restricted cash

Restricted cash consists of deposits held as security for income tax assessments and letters of credit. Restricted cash is classified as current or non-current assets based on the applicable restriction periods.

(e)Inventories

Heap leach ore, stockpiled ore, work-in-process and finished goods inventories are measured at the lower of weighted average cost and net realizable value (“NRV”). Costs include the cost of direct labour and materials, mine-site overhead expenses and depreciation and depletion of related mineral properties, plant and equipment. NRV is calculated as the estimated price at the time of expected sale based on prevailing and long-term metal prices less estimated future costs to convert the inventories into saleable form and selling costs.

The recovery of gold from certain ores is achieved through the heap leaching process. Under this method, ore is placed on leach pads where it is treated with a chemical solution that dissolves the gold contained in ore. The resulting solution is further processed in a plant where the gold is recovered. Costs are added to heap leach ore inventories based on mining and leaching costs incurred, including depreciation and depletion of related mineral properties, plant and equipment. Costs are removed from heap leach ore inventories as ounces of gold are recovered based on the average cost per recoverable ounce on the leach pads. The amount of recoverable gold on the leach pads is calculated based on the quantities of ore placed on the leach pads (measured tonnes added to the leach pads), the grade of ore placed on the leach pads (based on assay data) and a recovery percentage (based on ore type). The quantity of recoverable gold in ore on the leach pads that will be recovered over a period exceeding 12 months is classified as non-current.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(e)Inventories (continued)

Stockpiled ore inventories represent ore that has been extracted from the mine and is available for further processing. The average costs included in stockpiled ore inventories are based on mining costs incurred up to the point of stockpiling the ore, including depreciation and depletion related to mineral properties and equipment and are removed at the weighted average cost as ore is processed. Stockpiled ore that is not expected to be processed within the next 12 months is classified as non-current.

Work-in-process inventories represent ore that is in the process of being converted into finished goods, other than by heap leaching. The average costs included in work-in-process inventories represent the weighted average mining cost of ore being processed and the processing costs incurred prior to the refining process.

The average cost of finished goods represents the average cost of work-in-process inventories incurred prior to the refining process, plus applicable refining costs and associated royalties.

Supplies inventories include the costs of consumables, including freight, to be used in operations and is measured at the lower of average cost and NRV, with replacement costs being the typical measure of NRV.

Write-downs of inventories to NRV are included in operating expense in the period of the write-down. A write-down of inventories is reversed in a subsequent period if there is a subsequent increase in the NRV of the related inventories.

(f)Investments in associates

An associate is an entity over which the Company has significant influence. Significant influence is the power to participate in the financial and operating policy decisions of the investee but is not control or joint control over those decisions. The Company is presumed to have significant influence if it holds, directly or indirectly, 20% or more of the voting power of the investee, unless it can be clearly demonstrated that the Company does not have significant influence. Investments in entities in which the Company owns less than a 20% interest are generally accounted for as marketable securities or other investments in equity instruments unless it can be clearly demonstrated that significant influence exists based on the Company's contractual rights and other factors.

The Company accounts for an investment in associate using the equity method. Under the equity method, the Company’s investment in an associate is initially recognized at cost and subsequently increased or decreased to recognize the Company’s share of net income (loss) and OCI (other comprehensive loss) of the associate, and for impairment losses after the initial recognition date. The Company’s share of income or losses of its associate is recognized in net income or loss during each reporting period. Dividends and repayments of capital received from the associate are accounted for as a reduction in the carrying amount of the Company’s investment.

When an investee ceases to be an associate, the Company discontinues the use of the equity method to account for its investment. When the Company retains an interest in the former associate, the Company accounts for the interest as a marketable security or other investment in equity instrument and a gain or loss is recognized in net income or loss for the difference between: (i) the fair value of any retained interest and any proceeds from disposing of a part interest in the associate; and (ii) the carrying amount of the investment at the date the use of the equity method was discontinued.

(g)Mineral properties, plant and equipment

(i)Mineral properties and construction-in-progress

Mineral properties and construction-in-progress include:

•costs of acquiring producing and development stage mineral properties;

•costs reclassified from exploration and evaluation assets;

•capitalized development costs;

•deferred stripping costs;

•estimates of reclamation and closure costs (note 3(k)(i)); and

•borrowing costs incurred that are attributable to qualifying mineral properties (note 3(q)).

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(g)Mineral properties, plant and equipment (continued)

(i)Mineral properties and construction-in-progress (continued)

Development costs are those expenditures incurred subsequent to the establishment of economic recoverability, technical feasibility and commercial viability, and after receipt of approval for project expenditures from the Board of Directors. Development costs are capitalized to construction-in-progress until the mine reaches commercial production, at which point the capitalized development costs are reclassified to mineral properties. Commercial production is the point at which a mine is capable of operating in the manner intended by the Company's management.

During the production phase of an underground mine, mine development costs incurred to maintain current production are included in operating expense. These costs include the development and access (tunneling) costs of production drifts to develop the ore body in the current production cycle. Development costs incurred to build new shafts, declines and ramps that enable permanent access to ore underground are capitalized as incurred.

During the production phase of an open-pit mine, stripping costs incurred that provide improved access to ore that will be produced in future periods and that would not have otherwise been accessible are capitalized as deferred stripping assets. Deferred stripping assets are recognized and included as part of the carrying amount of the related mineral property when the following three criteria are met:

•It is probable that the future economic benefit (improved access to the ore body) associated with the stripping activity will flow to the Company;

•The Company can identify the component of the ore body for which access has been improved; and

•The costs relating to the stripping activity associated with that component can be measured reliably.

Capitalized stripping costs are depleted using the units-of-production method over the reserves that directly benefit from the specific stripping activity. Costs incurred for regular waste removal that do not give rise to future economic benefits are included in operating expense.

Mineral properties are carried at cost less accumulated depletion and accumulated impairment losses. Mineral properties are depleted using the units-of-production method over the estimated recoverable ounces, which is the estimated total ounces to be extracted in current and future periods based on proven and probable reserves and, in the case of certain underground mines, certain measured and indicated resources.

(ii)Exploration and evaluation expenditures

Exploration and evaluation activity involves the search for mineral resources, the determination of technical feasibility and the assessment of commercial viability of an identified resource. Exploration and evaluation activity includes exploratory drilling and sampling, surveying transportation and infrastructure requirements, and gathering exploration data through geophysical studies.

The Company capitalizes direct costs of acquiring resource property interests as exploration and evaluation assets. Option payments are considered acquisition costs if the Company has the intention of exercising the underlying option.

Exploration and evaluation costs incurred on sites without an existing mine and on areas outside the boundary of a known mineral deposit that contains proven and probable reserves are expensed as incurred up to the date of establishing that the project is technically feasible and commercially viable, and upon receipt of approval for project expenditures from the Board of Directors. Approval from the Board of Directors will be dependent upon the Company obtaining necessary permits and licenses to develop the mineral property. When approval for project expenditures is received, the related capitalized acquisition costs are assessed for impairment and reclassified to mineral properties. If no economically viable ore body is discovered, previously capitalized acquisition costs are expensed in the period that the project is determined to be uneconomical or abandoned.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(g)Mineral properties, plant and equipment (continued)

(iii)Plant and equipment

Plant and equipment is carried at cost, less accumulated depreciation and accumulated impairment losses. The cost of an item of plant and equipment consists of the purchase price, any costs directly attributable to bringing the asset to the location and condition necessary for its intended use, initial estimates of the costs of dismantling and removing an item and restoring the site on which it is located and, where applicable, borrowing costs.

The carrying amounts of plant and equipment are depreciated to the residual values, if any, using either the straight-line method over the shorter of the estimated useful life of the asset or the life of mine (“LOM”) or the units-of-production method over the estimated recoverable ounces.

For right-of-use assets, the depreciation period represents the period from lease commencement date to the earlier of the useful life of the underlying asset or the end of the lease term.

The Company conducts an annual assessment of the residual balances, useful lives and depreciation methods being used for plant and equipment; any changes arising from the assessment are applied by the Company prospectively.

(h)Financial instruments

(i)Recognition and measurement

Financial assets and financial liabilities are recognized when the Company becomes party to the contractual provisions of the financial instrument. On initial recognition, financial assets and financial liabilities are measured at fair value. Directly attributable transaction costs associated with financial assets or financial liabilities measured at fair value through profit or loss (“FVTPL”) are expensed as incurred, while directly attributable transaction costs associated with all other financial assets and financial liabilities are included in the initial carrying amount of the asset or liability, respectively.

Subsequent to initial recognition, financial assets and financial liabilities are classified and measured as follows:

Financial assets at amortized cost

Financial assets are classified as and subsequently measured at amortized cost if both of the following criteria are met: (i) the objective of the Company’s business model for managing the financial assets is to collect their contractual cash flows; and (ii) the assets' contractual cash flows represent solely payments of principal and interest on the principal amount outstanding (“SPPI”).

The Company’s cash and cash equivalents, restricted cash, trade receivables, receivables from asset sales, reclamation bonds (included in other non-current assets) and other current and non-current receivables are classified as and subsequently measured at amortized cost.

The amortized cost of a financial asset or financial liability is the initial recognition amount minus principal repayments, plus the cumulative amortization using the effective interest method of any difference between the initial recognition amount and the maturity amount.

Financial assets at FVTPL

Financial assets are classified and subsequently measured at FVTPL, with changes in fair value recognized in net income or loss, if they are not held within a business model whose objective includes collecting the financial assets' contractual cash flows or the contractual cash flows of the financial assets do not represent SPPI.

The Company’s marketable securities, other than those that the Company has elected to measure at fair value through OCI (“FVOCI”), are classified as and subsequently measured at FVTPL.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(h)Financial instruments (continued)

(i)Recognition and measurement (continued)

Equity investments at FVOCI

At initial recognition, the Company may irrevocably elect to present in OCI subsequent changes in the fair value of particular investments in equity instruments (on an individual instrument basis) that otherwise would be measured at FVTPL. This election is not permitted on investments in equity instruments that are held for trading. The cumulative gain or loss recognized in OCI is not reclassified to net income or loss upon disposition of the investment in equity instrument.

The Company has elected to measure certain of its investments in equity instruments that it intends to hold for strategic purposes at FVOCI and present subsequent changes in the fair value of the investments in OCI.

Financial liabilities at amortized cost

Accounts payable and accrued liabilities, loans and borrowings and certain other long-term liabilities are classified as and subsequently measured at amortized cost using the effective interest method, which includes the amortization of debt issue costs included in the carrying amounts of loans and borrowings.

Derivative assets and liabilities at FVTPL

A derivative is defined as having the following characteristics:

•Its value changes in response to the change in a specified interest rate, financial instrument price, commodity price, foreign exchange rate, index of prices or rates, or other variable, provided in the case of a non-financial variable that the variable is not specific to a party to the contract;

•It requires no initial net investment or an initial net investment that is smaller than would be required for other types of contracts that would be expected to have a similar response to changes in market factors; and

•It is settled at a future date.

A derivative, other than a derivative that meets the definition of an equity instrument, is initially recognized as a financial asset or financial liability at its fair value on the date the derivative contract is entered into and the related transaction costs are expensed. The fair values of the derivatives are remeasured at the end of each reporting period with changes in fair values recognized in net income or loss.

A derivative that will be settled by the Company delivering a fixed number of its own equity instruments in exchange for a fixed amount of cash in terms of its functional currency or another financial asset is classified and presented as an equity instrument, rather than a financial liability. As the exercise price of the Company's share purchase warrants that are exercisable into common shares of Equinox Gold is denominated in Canadian dollars, the Company will receive a variable amount of cash in terms of its US dollar functional currency upon exercise of the warrants. Accordingly, the Company's warrants are classified and presented as derivative financial liabilities and measured at FVTPL.

(ii)Derecognition of financial assets

The Company derecognizes a financial asset, or a part of the financial asset, when and only when (i) the contractual rights to the cash flows from the financial asset expire, or (ii) the Company transfers the financial asset and the transfer qualifies for derecognition. Transfers of a financial asset, either by (i) transferring the contractual rights to the financial asset, or (ii) retaining the contractual rights to receive the cash flows of the financial asset, but assuming a contractual obligation to pay the cash flows collected to one or more recipients without material delay and whereby the Company is prohibited from selling or pledging the financial asset other than as security to the eventual recipients, qualify for derecognition if the Company transfers substantially all the risks and rewards of ownership of the financial asset or control of the financial asset.

On derecognition of a financial asset, the difference between the carrying amount measured at the date of derecognition and the consideration received (including any new asset obtained less any new liability assumed) is recognized as a gain or loss in net income or loss.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(h)Financial instruments (continued)

(iii)Modification of contractual cash flows

When the contractual cash flows of a financial asset are renegotiated or otherwise modified and the renegotiation or modification does not result in the derecognition of the financial asset, the Company recalculates the gross carrying amount of the financial asset and recognizes a modification gain or loss in net income or loss. The gross carrying amount of the financial asset is calculated as the present value of the renegotiated or modified contractual cash flows that are discounted at the financial asset's original effective interest rate.

Any costs or fees incurred adjust the carrying amount of the modified financial asset and are amortized over the remaining term of the modified financial asset.

(i)Impairment

(i)Non-financial assets and investments in associates

The carrying amounts of the Company’s non-financial assets, including mineral properties, plant and equipment, and investments in associates are reviewed at the end of each reporting period to determine whether there is any indication of impairment. If any such indication exists, the asset’s recoverable amount is estimated.

The recoverable amount of an asset is the higher of its value in use and fair value less costs of disposal. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. Fair value less costs of disposal is the amount obtainable from the sale of the asset in an arm’s length transaction between knowledgeable, willing parties, less costs of disposal. When a binding sale agreement is not available, fair value less costs of disposal is estimated using a discounted cash flow approach with inputs and assumptions consistent with those at market. For the purpose of impairment testing, assets are assessed on an individual asset basis when applicable or grouped together into the smallest group of assets that generates cash inflows that are largely independent of cash inflows from other assets or groups of assets (the “CGU”). This generally results in the Company evaluating its non-financial assets on a property-by-property basis.

An impairment loss is recognized if the carrying amount of an asset or CGU exceeds its estimated recoverable amount. Impairment losses are recognized in net income or loss. Where an impairment loss subsequently reverses, the carrying amount of the asset or CGU is increased to the revised estimate of the recoverable amount. An impairment loss is reversed through net income or loss only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of any applicable depreciation and depletion, if no impairment loss had been recognized.

(ii)Financial assets

The Company recognizes a loss allowance for expected credit losses on financial assets that are measured at amortized cost. At each reporting date, the loss allowance for a financial asset measured at amortized cost is measured at an amount equal to the lifetime expected credit losses if the credit risk on the financial asset has increased significantly since initial recognition. If, at the reporting date, the credit risk on a financial asset measured at amortized cost, other than a trade receivable, has not increased significantly since initial recognition, the loss allowance is measured for the financial asset at an amount equal to the 12-month expected credit losses. For trade receivables, the Company measures the loss allowance at an amount equal to the lifetime expected credit losses.

For a financial asset that becomes credit-impaired, the Company measures the expected credit losses as the difference between the gross carrying amount of the financial asset and the present value of the estimated future cash flows discounted at the financial asset's original effective interest rate. A financial asset is credit-impaired when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred.

The Company recognizes the amount of expected credit losses (or reversal) required to adjust the loss allowance at each reporting date to the required amount as an impairment loss (or gain) in net income or loss.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(j)Assets held for sale

A non-current asset or disposal group of assets and liabilities is classified as held for sale when it is highly probable that its carrying amount will be recovered principally through a sale transaction rather than through continuing use. A non-current asset or disposal group is classified as held for sale when the following criteria are met: (i) the asset or disposal group is available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such assets or disposal group; (ii) the appropriate level of management is committed to a plan to sell the asset or disposal group; (iii) an active program to locate a buyer and complete the plan has been initiated; (iv) the asset or disposal group is actively marketed for sale at a price that is reasonable in relation to its current fair value; (v) the sale is expected to complete within one year from the date of classification, except under certain events and circumstances; and (vi) actions required to complete the plan to sell the asset or disposal group indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. A non-current asset or disposal group ceases to be classified as held for sale when the above criteria are no longer met.

A non-current asset or disposal group classified as held for sale is measured at the lower of its carrying amount and fair value less costs to sell. The Company recognizes an impairment loss for any initial or subsequent write-down of a non-current asset or disposal group classified as held for sale to fair value less costs to sell in net income or loss during the period of the write-down. The Company recognizes a gain for any subsequent increase in fair value less costs to sell of a non-current asset or disposal group to the extent of previously recognized impairment losses on the non-current asset or disposal group. A non-current asset is not depreciated or depleted while it is classified as held for sale, or as part of a disposal group classified as held for sale.

(k)Provisions

(i)Reclamation and closure cost provisions

The Company is subject to environmental laws and regulations. A provision for reclamation and closure costs is recognized at the time the legal or constructive obligation first arises which is generally the time that the environmental disturbance occurs. The provision is calculated as the present value of the expenditures required to settle the obligation. Upon initial recognition of the provision, a corresponding amount is added to the carrying amount of the related mineral property, plant or equipment and is amortized using the same method as applied to the related asset. Following the initial recognition of the provision, the carrying amount is increased for the unwinding of the discount and for changes to the discount rate and the amount or timing of cash flows required to settle the obligation. The unwinding of the discount is recognized as finance expense in net income or loss while the effect of the changes to the discount rate and the amount or timing of cash flows are recognized as an adjustment to the carrying amount of the related mineral property, plant or equipment.

(ii)Other provisions

A provision is recognized if, because of a past event, the Company has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined using the expected future cash flows discounted, if material, at a pre-tax rate that reflects the current market assessments of the time value of money and the risks specific to the liability. The unwinding of the discount is recognized as finance expense in net income or loss.

(l)Leases

A contract is or contains a lease when the contract conveys a right to control the use of an identified asset for a period of time in exchange for consideration.

As a lessee, the Company recognizes a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is initially measured at cost, and subsequently at cost less any accumulated depreciation and accumulated impairment losses, and adjusted for remeasurements of the lease liability. The cost of the right-of-use asset includes the amount of the initial measurement of the lease liability, any lease payments made at or before the commencement date, less any lease incentives received and any initial direct costs and, if applicable, an estimate of costs to be incurred by the Company in dismantling and removing the underlying asset, restoring the site on which it is located or restoring the underlying asset to the condition required by the terms and conditions of the lease.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(l)Leases (continued)

The lease liability is initially measured at the present value of the lease payments during the lease term that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Company’s incremental borrowing rate. The lease term is the non-cancellable period of a lease together with periods covered by extension options that the Company is reasonably certain to exercise and periods covered by termination options that the Company is reasonably certain not to exercise. The incremental borrowing rate reflects the rate of interest that the Company would have to pay to borrow the funds necessary to obtain an asset of similar value in a similar economic environment with similar terms and conditions. Generally, the Company uses its incremental borrowing rate as the discount rate.

The lease liability is subsequently increased by the interest on the lease liability, measured using the discount rate, and decreased by lease payments made. The lease liability is remeasured using an unchanged discount rate when there is a change in future lease payments arising from a change in an index or rate, or a change in the amount expected to be payable under a residual value guarantee. The lease liability is remeasured using a revised discount rate when there is a change in future lease payments resulting from changes in the assessment of whether a purchase or extension option is reasonably certain to be exercised or a termination option is reasonably certain not to be exercised. The revised discount rate in this case is the interest rate implicit in the lease for the remainder of the term or the Company's incremental borrowing rate at the date of reassessment.

The Company has elected not to recognize right-of-use assets and lease liabilities for leases of low-value assets, leases with lease terms that are less than 12 months and arrangements for the Company's use of land to explore, develop, produce or otherwise use the mineral resource contained in that land. Lease payments associated with these leases are instead recognized as an expense over the lease term on either a straight-line basis, or another systematic basis if it is more representative of the pattern of benefit.

The Company presents right-of-use assets in the same line item as it presents underlying assets of the same nature that it owns. The Company presents lease liabilities in other liabilities in the statement of financial position.

(m)Share capital

The Company's common shares are classified as equity. Incremental costs directly attributable to the issuance of common shares are recognized as a deduction from equity, net of any tax effects.

(n)Share-based payments

(i) Equity-settled share-based payments

The fair value of the estimated number of stock options and other equity-settled share-based payments that are expected to vest, determined as of the date of the grant, is recognized as share-based compensation expense over the vesting period, with a corresponding increase in shareholders’ equity (within reserves). The total amount recognized as an expense is adjusted to reflect the number of options and other equity-settled share-based payments expected to vest at each reporting date.

The fair value of stock options granted is estimated at the date of the grant using the Black-Scholes option pricing model. The Black-Scholes option pricing model requires the input of subjective assumptions, including the expected life of the option and expected share price volatility. The expected life of the options granted is determined based on the average historical hold period before exercise or expiry. Expected volatility is estimated with reference to the historical volatility of the share price of the Company.

The Company estimates the fair values of equity-settled restricted share units (“RSUs”) and equity instruments issuable under equity-settled restricted share units with performance-based vesting conditions (“pRSUs”), that are non-market conditions, based on the quoted price of the Company's common shares on the date of grant. Share-based compensation expense related to pRSUs with non-market performance conditions is recognized over the expected vesting period with the cumulative amount recognized adjusted at the end of each reporting period to reflect the change, if any, in the number of pRSUs expected to vest and expected vesting period based on expected performance.

The fair values of pRSUs with market conditions are estimated using the Monte Carlo method to project the performance of the Company and, if applicable, the relevant market index against which the Company's performance is compared. Share-based compensation expense related to pRSUs that vest based on market conditions is recognized over the vesting period based on the grant date fair value of the award.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(n)Share-based payments (continued)

(i) Equity-settled share-based payments (continued)

When share-based payment transactions provide the Company with a choice to settle in cash or by issuing equity instruments, the Company accounts for the share-based payment as cash-settled when the Company determines that it has a present obligation to settle in cash.

(ii)Cash-settled share-based payments

The fair values of cash-settled share-based payments are recognized as share-based compensation expense over the vesting period, with a corresponding increase to liabilities. The liabilities for cash-settled share-based payments are remeasured at the end of each reporting period and at the date of settlement, with any changes in fair value recognized in net income or loss for the period.

The Company's cash-settled share-based payments consist of deferred share units (“DSUs”), certain RSUs, and performance share units (“PSUs”) which vest based on the achievement of certain performance targets. The fair values of cash-settled DSUs and RSUs are estimated based on the current quoted market price of the Company's common shares. The fair values of cash-settled PSUs are based on the current quoted market price of the Company's common shares and projected performance.

(o)Revenue recognition

Revenue is principally generated from the sale of gold bullion with each shipment considered as a separate performance obligation. The Company recognizes revenue at the point when the customer obtains control of the product. Control is transferred when title has passed to the customer, the customer has assumed the significant risks and rewards of ownership of the asset and the Company has the present right to payment for the delivery of the gold bullion.

(p)Employee benefits

Short-term employee benefit obligations are recognized as expenses, except for amounts included in the cost of inventories and mineral properties, plant and equipment, as the corresponding service is provided. Liabilities are recognized at the amount that is expected to be paid if the Company has a present legal or constructive obligation to pay that amount based on past services rendered by the employee, and the obligation can be estimated reliably. The Company has no long-term employee benefit plans.

(q)Borrowing costs

Borrowing costs that are directly attributable to the acquisition and construction/development of a qualifying asset are capitalized during the period of time that is necessary to complete and prepare the asset for its intended use or sale. Other borrowing costs are expensed as finance expense in the period in which they are incurred. To the extent that the Company borrows funds specifically for the purpose of obtaining a specific qualifying asset, the amount of borrowing costs eligible for capitalization is the actual net borrowing costs incurred on that borrowing during the period. To the extent that the Company borrows funds generally and uses them for the purpose of obtaining a qualifying asset, the amount of borrowing costs eligible for capitalization is determined by applying a capitalization rate to the expenditures on that asset. The capitalization rate is calculated as the weighted average of the borrowing costs applicable to all borrowings of the Company, other than specific borrowings, that are outstanding during the period.

(r)Income taxes

Income taxes comprises current tax and deferred tax. Income tax is recognized in net income or loss except to the extent that it relates to items recognized directly in equity, in which case it is recognized in equity.

Current tax expense is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at the reporting date, adjusted for amendments to tax payable or receivable related to previous years.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(r)Income taxes (continued)

Deferred tax is recognized for differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred taxes are not recognized for temporary differences related to the initial recognition of assets or liabilities, other than in business combinations, that affect neither accounting nor taxable income, temporary differences arising on the initial recognition of goodwill and temporary differences relating to investments in subsidiaries to the extent that the Company can control the timing of the reversal of the temporary differences and it is probable that they will not reverse in the foreseeable future. Deferred taxes are measured at the tax rates that are expected to be applied to temporary differences when they reverse based on laws that have been enacted or substantively enacted at the reporting date.

A deferred tax asset is recognized only to the extent that it is probable that future taxable income will be available against which the asset can be utilized.

Tax assets and liabilities are offset when there is a legally enforceable right to offset tax assets against tax liabilities and when they are related to income taxes levied by the same taxation authority and the Company intends to settle its current tax assets and liabilities on a net basis.

Royalties and other arrangements are treated as tax arrangements when they have the characteristics of income tax. This is the case when they are imposed under government authority and the amount payable is calculated by reference to an income measure. Obligations arising from royalty arrangements that do not satisfy these criteria are recognized as current liabilities and included within operating expense.

When there is uncertainty over income tax treatments, the Company assesses whether it is probable that the relevant taxation authority will accept the uncertain tax treatment. This assessment affects the amount of income tax expense or recovery recognized by the Company. If the Company concludes that it is not probable that a taxation authority will accept the uncertain tax treatment, the effect of the uncertain income tax treatment is reflected in the determination of the Company's income tax expense or recovery based on the most likely amount or, if there are a wide range of possible outcomes, the expected value.

(s)Income (loss) per share

Basic income (loss) per share (“EPS”) is calculated by dividing the income or loss attributable to common shareholders of the Company by the weighted average number of common shares outstanding during the period. Diluted EPS is determined by adjusting the income or loss attributable to common shareholders and the weighted average number of shares outstanding for the effects of all dilutive potential common shares, which comprise share purchase warrants, convertible debentures, stock options and equity-settled RSUs. Contingently issuable shares under the Company's outstanding pRSUs are included in the diluted EPS calculation based on the number of shares that would be issuable if the reporting date were the end of the contingency period. The dilutive effect of share purchase warrants and stock options assumes that the proceeds from potential exercise of the instruments are used to repurchase the Company's common shares at the average market price for the period. Share purchase warrants and stock options are dilutive and included in the diluted EPS calculation to the extent exercise prices are below the average market price of the Company's common shares.

(t)Contingencies

Contingent assets and contingent liabilities are not recognized in the consolidated financial statements. Contingent assets and contingent liabilities are possible assets or possible obligations that arise from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company. A contingent liability can also be a present obligation that arises from past events but is not recognized because it is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation or the amount of the obligation cannot be measured with sufficient reliability.

Contingent assets and contingent liabilities are continually assessed to ensure developments are appropriately reflected in the consolidated financial statements.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(u)Changes in accounting policies during the reporting period

(i)Property, Plant and Equipment - Proceeds before Intended Use (Amendments to IAS 16)

On May 14, 2020, the IASB published Property, Plant and Equipment - Proceeds before Intended Use (Amendments to IAS 16) which prohibits deducting from the cost of property, plant and equipment any proceeds from selling items produced while preparing the asset for its intended use. Instead, proceeds from selling such items and the cost of producing such items shall be recognized in net income or loss.

The effective date of the amendments is for annual periods beginning on or after January 1, 2022. Earlier application is permitted. The amendments apply retrospectively, but only to items of property, plant and equipment made available for use on or after the beginning of the earliest period presented in the consolidated financial statements in which the Company first applies the amendments.

The Company early applied the amendments in its consolidated financial statements for the annual period beginning on January 1, 2021. On application of the amendments, the Company reclassified $1.6 million of pre-commercial production net proceeds from mineral properties, plant and equipment as at December 31, 2020 to net income for the year ended December 31, 2020, comprising $2.9 million in revenue, $1.0 million in operating expense and $0.3 million in depreciation and depletion.

(ii)Presentation of finance fees and interest paid in statement of cash flows

Effective January 1, 2021, the Company made an accounting policy change to classify finance fees paid (which includes interest paid) within the consolidated statement of cash flows for the year ended December 31, 2021 as a financing activity rather than an operating activity, which more appropriately reflects the nature of these cash flows. Interest paid has been disclosed separately as a financing cash flow. Comparative figures for the year ended December 31, 2020 have been reclassified to conform with the change in accounting policy.

(iii)Interest rate benchmark reform

Interest rate benchmark reform (“Reform”) refers to the global reform of interest rate benchmarks, which includes the replacement of some interbank offered rates with alternative benchmark rates. The Company applied Interest Rate Benchmark Reform - Phase 2 (Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16) (the “Reform Amendments”) effective January 1, 2021. The Reform Amendments provide a practical expedient requiring the effective interest rate be adjusted when accounting for changes in the basis for determining the contractual cash flows of financial assets and liabilities that relate directly to the Reform rather than applying modification accounting which might have resulted in a gain or loss. In addition, the Reform Amendments require disclosures to assist users in understanding the effect of the Reform on the Company's financial instruments and risk management strategy.

On March 5, 2021, the Financial Conduct Authority, the regulatory supervisor of the administrator of London Interbank Offered Rate (“LIBOR”), announced that panel bank submissions for the 1-week and 2-month USD LIBOR settings will cease immediately after December 31, 2021, and immediately after June 30, 2023, in the case of the remaining USD LIBOR settings, after which representative LIBOR rates will no longer be available.

The Company maintains a credit facility, which comprises a $400 million revolving loan (the “Revolving Facility”) and a $100 million amortizing term loan (the “Term Loan”) (together, the “Credit Facility”), that bears interest at the LIBOR applicable to the interest period on each draw down plus an applicable margin ranging from 2.5% to 3.75% based on the Company's leverage ratio (note 14(a)). At December 31, 2021, the Company had $193.8 million owing under the Revolving Facility and $85.8 million owing under the Term Loan. The Revolving Facility matures on March 8, 2024 and the Term Loan matures on March 10, 2025. The Credit Facility agreement contains terms that replace the applicable current benchmark rate with an alternate benchmark rate when the current benchmark rate ceases to exist, which may include a term rate based on the Secured Overnight Financing Rate (“SOFR”). The Company expects to apply the practical expedient but the impact on the Company's consolidated financial statements cannot be determined until the alternate benchmark rate is agreed on with the counterparty.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(v)Amended IFRS standard not yet effective

In May 2021, the IASB issued Deferred Tax related to Assets and Liabilities Arising from a Single Transaction which amended IAS 12, Income Taxes (“IAS 12”). The amendments narrowed the scope of the recognition exemption in IAS 12, relating to the recognition of deferred tax assets and liabilities, so that it no longer applies to transactions that, on initial recognition, give rise to equal taxable and deductible temporary differences such as leases and reclamation and closure cost provisions. The amendments are effective for annual reporting periods beginning on or after January 1, 2023 to transactions that occur on or after the beginning of the earliest comparative period presented. Earlier application is permitted. The Company is currently assessing the impact of the amendments on its consolidated financial statements.

4. AREAS OF SIGNIFICANT JUDGEMENT AND ESTIMATION UNCERTAINTY

In preparing these consolidated financial statements, management has made judgements, estimates and assumptions that affect the application of the Company’s accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from estimates and assumptions made as the estimation process is inherently uncertain. All estimates and assumptions are reviewed on an ongoing basis based on relevant facts and circumstances, and new reliable information or experience. Revisions to estimates are recognized in the period in which the estimates are revised and in any future periods affected. Information about critical judgements that management has made in the process of applying the Company's accounting policies that have the most significant effect on amounts recognized in these consolidated financial statements and the major sources of estimation uncertainty at December 31, 2021 that could result in a material adjustment to the carrying amounts of assets and liabilities within the next financial year are as follows:

(a)Judgements

(i)Acquisitions

On the acquisition of a set of assets and liabilities, the acquiror must determine whether the set acquired includes the inputs and processes applied to those inputs necessary to constitute a business as defined in IFRS 3 – Business Combinations. If an acquired set of assets and liabilities includes goodwill, the set is presumed to be a business. Transactions accounted for as business combinations may result in goodwill or a bargain purchase gain and transaction costs are expensed. Transactions accounted for as asset acquisitions do not result in goodwill or a bargain purchase gain and transaction costs are capitalized as part of the assets acquired.

Based on an assessment of the relevant facts and circumstances, the Company concluded that the acquisitions of Premier on April 7, 2021 and Leagold on March 10, 2020 met the criteria for transactions accounted for as business combinations and that Equinox Gold was the acquirer. The Company's acquisition of an additional 10% interest in Greenstone on April 16, 2021 was determined to be an asset acquisition.

(ii)Investments

Management applies judgement in assessing whether the facts and circumstances pertaining to each investment result in the Company having control, joint control or significant influence over an investee.

The Company determined that its initial 50% interest in Greenstone, acquired in connection with the Premier Acquisition on April 7, 2021 represented joint control of Greenstone and that Greenstone was a joint operation due to provisions in the limited partnership agreement that require unanimous approval of the partners regarding the relevant activities of Greenstone, and the fact that the partnership is primarily designed for the provision of output to the partners, giving the partners rights to substantially all the economic benefits of the assets of Greenstone, and is dependent on the partners on a continuous basis to settle the liabilities of Greenstone. On April 16, 2021, upon acquisition of an incremental 10% interest in Greenstone, resulting in the Company's total interest in the project being 60%, the Company reassessed its conclusion on joint control and the classification of the joint arrangement and determined no changes were required as the acquisition of the additional interest did not change the contractual sharing of control.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

4. AREAS OF SIGNIFICANT JUDGEMENT AND ESTIMATION UNCERTAINTY (CONTINUED)

(a)Judgements (continued)

(ii)Investments (continued)

On April 28, 2021, upon sale of a portion of the Company's shareholdings in Solaris Resources Inc. (“Solaris”), the Company's interest in Solaris decreased to 19.9%. The Company determined that due to the reduction of its interest, the Company no longer had significant influence and discontinued accounting for its interest using the equity method. The Company recognized a gain of $186.1 million on reclassification of its investment (note 5(d)). At December 31, 2021, the Company's investment in Solaris common shares is accounted for as a marketable security measured at FVOCI.

(iii)Functional currency

The functional currency of the Company and each of its subsidiaries and joint operation is the currency of the primary economic environment in which the entity operates. The Company determined the functional currency of the Company and each of its subsidiaries is the US dollar, and the functional currency of Greenstone is the Canadian dollar. Determination of functional currency involves certain judgements about the primary economic environment. The Company will reconsider its functional currency and that of its subsidiaries and joint operation if there is a change in events and conditions that determined the primary economic environment and account for the effects of a change in functional currency prospectively.

(iv)Commencement of commercial production

Until a mine is capable of operating at levels intended by management, costs incurred, other than costs associated with the sale of gold doré produced, and including borrowing costs incurred on qualifying assets, are capitalized as part of the costs of the related mineral properties. Depletion of capitalized costs for mineral properties begins when the mine is capable of operating at levels intended by management. Management considers several factors in determining when a mineral property is capable of operating at levels intended by management. Amongst other quantitative and qualitative factors, throughput, mill grades, recoveries, and for a heap leach operation, stacking rates and irrigation rates, are assessed over a reasonable period to make this determination. The Company determined that Phase 1 of the two-phase development plan at Castle Mountain consisting of a run-of-mine heap leach operation was capable of operating at levels intended by management effective November 21, 2020.

(v)Indicators of impairment

Judgement is required in assessing whether certain factors would be considered an indicator of impairment. The Company considers both external and internal sources of information in assessing whether there are any indications that CGUs may be impaired and, accordingly, whether impairment testing is needed. External sources of information the Company considers include changes in the market, economic and legal environment in which the Company operates that are not within its control and are expected to affect the recoverable amount of CGUs. Internal sources of information the Company considers include the manner in which mineral properties, plant and equipment are being used or are expected to be used and indications of economic performance of the assets. The primary external factors considered are changes in spot and forecast metal prices, changes in laws and regulations and the Company's market capitalization relative to its net asset carrying amount. The primary internal factors considered are the Company's current mine performance against expectations, changes in mineral reserves and resources, life of mine plans and exploration results.

Significant assumptions are used in preparing life of mine plans including forecast metal prices, reserves and resources, mine production, operating costs, capital expenditures, discount rates and foreign exchange rates. These estimates and assumptions are subject to risk and uncertainty, particularly in circumstances where there is a limited operating history of the asset or CGU.

(vi)Income taxes

In determining the Company's income tax expense for the period, management applies judgement in the interpretation of tax legislation in multiple jurisdictions. The Company is subject to tax assessments by various taxation authorities, which may interpret legislation differently. These differences may affect the final amounts or timing of tax payments. The amounts recognized in the consolidated financial statements are based on management's judgements on the application of tax legislation and the probable outcome of tax assessments.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

4. AREAS OF SIGNIFICANT JUDGEMENT AND ESTIMATION UNCERTAINTY (CONTINUED)

(a)Judgements (continued)

(vii)Contingencies

Contingencies are possible assets or liabilities arising from past events that, by their nature, will be resolved only when one or more uncertain future events occur or fail to occur and are not recognized in the consolidated financial statements. Such contingencies include, but are not limited to, environmental obligations, litigation, regulatory proceedings, tax matters and losses resulting from other events. Contingencies are assessed continually to ensure that developments are appropriately reflected in the consolidated financial statements. The assessment of the existence and potential impact of contingencies inherently involves the exercise of significant judgement regarding the outcome of future events and probability of an inflow or outflow of economic benefits.

(b)Key sources of estimation uncertainty

(i)Mineral reserve and mineral resource estimates

The Company estimates its mineral reserves and mineral resources based on information compiled by qualified persons as defined by National Instrument (“NI”) 43-101. Estimates of proven and probable mineral reserves, and measured and indicated mineral resources are used in the calculation of depreciation, depletion and determination, when applicable, of the recoverable amount of CGUs, and for forecasting the timing of reclamation and closure cost expenditures.

There are numerous uncertainties inherent in estimating mineral reserves and resources, and assumptions that are valid at the time of estimation may change significantly when new information becomes available. Changes in forecast commodity prices, foreign exchange rates, operating expense or recovery rates may change the economic status of mineral reserves and resources and may, ultimately, result in mineral reserve and resources estimates being revised. Changes in estimates of mineral reserves and resources could impact depreciation and depletion rates, asset carrying amounts and the provision for reclamation and closure costs.

(ii)Valuation of inventories

Inventories are measured at the lower of weighted average costs and NRV. Weighted average costs include expenditures incurred and depreciation and depletion of assets used in mining and processing activities that are deferred and accumulated as the costs of heap leach ore, stockpiled ore, work-in-process and finished goods inventories. The determination of NRV involves the use of estimates. The NRV of inventories is calculated as the estimated price at the time of eventual sale based on prevailing and forecast metal prices less estimated future costs to convert the inventories into saleable form and associated selling costs.

The Company also makes estimates of recoverable ounces on the leach pads based on quantities of ore placed on the leach pads, the grade of ore placed on the leach pads and an estimated recovery rate. Actual timing and ultimate recovery of gold contained on the leach pads can differ significantly from these estimates. Changes in estimates of recoverable ounces on the leach pads can impact the Company's ability to recover the carrying amount of the inventories and may result in a write-down of inventories.

(iii)Reclamation and closure costs

The Company’s provision for reclamation and closure costs represents management’s best estimate of the present value of the future cash outflows required to settle the liability, which reflects estimates of future costs, inflation, movements in foreign exchange rates and assumptions of risks associated with the future cash outflows, and the applicable risk-free interest rates for discounting the future cash outflows (note 16). Changes in the above estimates and assumptions can result in a change to the provision recognized by the Company.

Changes to the provision for reclamation and closure costs are recognized with a corresponding change to the carrying amounts of related mineral properties, plant and equipment during the period of change. Adjustments to the carrying amounts of related mineral properties, plant and equipment can result in a change to future depletion expense.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

4. AREAS OF SIGNIFICANT JUDGEMENT AND ESTIMATION UNCERTAINTY (CONTINUED)

(b)Key sources of estimation uncertainty (continued)

(iv)Income taxes and value-added taxes receivable

Deferred tax assets and liabilities are measured at the tax rates expected to apply to the periods the assets are realized and the liabilities are settled. In determining the applicable rates to apply, the Company makes estimates of the timing of reversal of temporary differences. The Company also makes estimates of the amounts and timing of future taxable income available against which deductible temporary differences can be utilized. Estimates of future taxable income are based on forecasted results of operations, application of tax legislation and available tax opportunities. The impacts of changes in these estimates are recognized in the period of change.

The Company provides for uncertain income tax treatments based on management's judgement on the probable outcome of tax assessments; the amounts recognized are measured based on the most likely amount or, if there are a wide range of possible outcomes, the expected value of the liability. Adjustments for differences between amounts recognized and final amounts as assessed by the taxation authorities are made during the period such differences are identified.

The Company has receivables from various governments for federal and state value-added taxes (“VAT”). The timing and amount of VAT receivables collectible can be uncertain. Management makes significant estimates in its assessment of recoverability of these receivables. Changes in estimates made can result in the recognition or reversal of impairment losses within net income or loss.

(v)Fair value measurement of derivative financial instruments

The fair value measurement of the Company's derivative financial instruments requires the use of option pricing models or other valuation techniques (note 15).The fair value measurements of the Company's investments in warrants, Equinox Gold share purchase warrants with exercise prices denominated in CAD that are not traded, and Solaris share purchase warrants are based on the use of an option pricing model that uses assumptions related to expected life and share price volatility as inputs. The fair value measurements of gold collar and forward contracts and foreign exchange contracts are based on forward gold prices and forward foreign exchange rates, respectively. The fair value measurement of the production component of the contingent consideration in connection with the Greenstone acquisition is based on forward gold prices and assumptions related to the achievement of production milestones. Changes in assumptions and estimates used could result in changes in the fair values of the derivative financial instruments which are recognized in net income or loss.

5. CORPORATE TRANSACTIONS

(a)Acquisition of Premier

On April 7, 2021, the Company acquired 100% of the issued and outstanding shares of Premier at an exchange ratio of 0.1967 Equinox Gold common shares for each Premier share. All outstanding options and warrants of Premier that were not exercised prior to the acquisition date were replaced with Equinox Gold options and warrants, as adjusted in accordance with the 0.1967 exchange ratio. The principal properties acquired by the Company in the Premier Acquisition were a 50% interest in Greenstone in Canada and the Mercedes Mine in Mexico. Immediately prior to the Premier Acquisition, Premier completed the spin-out of i-80 Gold Corp. (“i-80 Gold”), a newly created company holding Premier's gold projects in Nevada, United States. Premier retained a 30% interest in i-80 Gold which the Company acquired (note 11).

The Company determined that the Premier Acquisition represents a business combination, with Equinox Gold identified as the acquirer. Transaction costs incurred in respect of the acquisition totaling $3.2 million, of which $0.8 million were incurred in 2020, were expensed and presented as professional fees within general and administration expense in the consolidated statements of income.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

5. CORPORATE TRANSACTIONS (CONTINUED)

(a)Acquisition of Premier (continued)

The acquisition-date fair value of the consideration transferred consisted of the following:


Share consideration(1)	$	399,613
Option consideration(2)	8,155
Warrant consideration(3)	505
Total consideration	$	408,273

(1)The fair value of 47,373,723 common shares issued to Premier shareholders was determined using the Company’s share price of C$10.64 ($8.44) per share on the acquisition date.

(2)The fair value of 2,813,747 replacement options issued was determined using the Black-Scholes option pricing model with the following weighted average assumptions: exercise price of C$7.27, share price of C$10.64, expected life of 2.07 years, expected volatility of 41.30%, dividend yield of 0.0%, and discount rate of 0.37%.

(3)The fair value of 393,400 replacement warrants issued was determined using the Black-Scholes option pricing model with the following weighted average assumptions: exercise price of C$10.42, share price of C$10.64, expected life of 0.82 years, expected volatility of 39.7%, dividend yield of 0.0%, and discount rate of 0.15%.

In accordance with the acquisition method of accounting, the consideration transferred was allocated to the underlying assets acquired and liabilities assumed, based upon their estimated fair values at the date of acquisition. The table below presents the fair values of the assets acquired and liabilities assumed at the date of acquisition.


Assets (liabilities) acquired
Cash and cash equivalents	$	8,267
Trade and other receivables	13,165
Inventories	11,987
Restricted cash	8,333
Mineral properties, plant and equipment	576,803
Investment in associate	79,001
Other assets	4,399
Accounts payable and accrued liabilities	(18,002)
Loans and borrowings and accrued interest	(17,649)
Stream arrangement	(40,369)
Reclamation and closure cost provisions	(13,481)
Deferred tax liabilities	(121,931)
Other liabilities	(818)
Fair value of net assets acquired	$	489,705

The above fair values were finalized at December 31, 2021. The Company retained an independent appraiser to assist with determination of the fair values of certain assets acquired and liabilities assumed. The fair value of inventories was determined based on an NRV approach, whereby the future estimated cash flows from sales of payable metal produced are adjusted for costs to complete. The fair value of the investment in associate, representing the Company's 30% interest in i-80 Gold, was based on the quoted market price of i-80 Gold common shares. The fair value of mineral properties, plant and equipment, excluding exploration and evaluation assets, was based on comparable transactions. An in-situ approach was used to estimate the fair values of certain exploration assets with reference to a public company comparables analysis. The fair values of the stream arrangement and reclamation and closure cost provisions were estimated using discounted cash flow models. Expected future cash flows associated with the stream arrangement are based on estimates of future gold and silver prices and discount rates. Expected future cash flows related to the reclamation and closure cost provisions are based on estimates of the future expenditures required to settle the obligation for disturbances at the acquisition date, and discount rates.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

5. CORPORATE TRANSACTIONS (CONTINUED)

(a)Acquisition of Premier (continued)

Upon finalization of the fair values of assets acquired and liabilities assumed, the Company retrospectively adjusted the provisional amounts recognized at the acquisition date. As a result, the Company recognized a bargain purchase gain of $81.4 million, equal to the excess of the final fair value of the net assets acquired over the total consideration, in other income (expense). The difference of $81.4 million between the final fair value of net assets acquired as compared to the provisional fair value of net assets acquired was mainly related to mineral properties, plant and equipment ($94.4 million) and the associated deferred tax liabilities ($13.0 million).

Consolidated revenue for the year ended December 31, 2021 includes revenue from the properties acquired in the Premier Acquisition of $56.9 million. Consolidated net income for the year ended December 31, 2021 includes net income before tax from Premier of $7.7 million. Had the transaction occurred on January 1, 2021, pro-forma unaudited consolidated revenue and net income before tax for the year ended December 31, 2021 would have been approximately $1,115.0 million and $541.0 million, respectively.

(b)Acquisition of additional interest in Greenstone

On April 16, 2021, the Company completed the acquisition of an additional 10% interest in Greenstone, resulting in the Company’s total interest in the project being 60%, for a total cost of $59.9 million, consisting of a cash payment of $51.0 million on closing and the following contingent consideration:

•a $5.0 million cash payment 24 months after a positive mine construction decision for Greenstone; and

•the delivery of approximately 2,200 ounces of refined gold, the cash equivalent value of such refined gold, or a combination thereof, after each production milestone of 250,000 ounces, 500,000 ounces and 700,000 ounces from Greenstone.

The contingent consideration was measured at fair value at the date of acquisition in the amount of $8.9 million based on the projected cash outflows associated with the contingent payments at the milestone dates, adjusted for the time value of money using an appropriate market-based discount rate that reflects the risk associated with the delivery of the contingent consideration.

The Company concluded that Greenstone was not a business and accordingly accounted for the acquisition of the additional 10% interest as an asset acquisition. The total cost of acquisition was allocated to the assets acquired and liabilities assumed as follows:


Assets (liabilities) acquired
Cash and cash equivalents	$	95
Trade and other receivables	21
Restricted cash	1,043
Mineral properties, plant and equipment	59,078
Other assets	10
Accounts payable	(287)
Other liabilities	(27)
Net assets acquired	$	59,933

The contingent consideration has been accounted for as financial liabilities. The cash component of the contingent consideration is classified as a financial liability measured at amortized cost and accreted at the end of each reporting period using an effective interest rate of 18.5%. The production component is classified as a derivative financial liability measured at FVTPL at the end of each reporting period (note 15(b)(v)).

At December 31, 2021, the amortized cost of the cash component was $3.6 million and the fair value of the derivative component was $6.6 million. The carrying amounts of the cash and derivative contingent consideration are included in other non-current liabilities and non-current derivative liabilities, respectively.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

5. CORPORATE TRANSACTIONS (CONTINUED)

(c)Sale of Pilar

On April 16, 2021, the Company completed the sale of its Pilar mine in Brazil (“Pilar”) to Pilar Gold Inc. (“PGI”) in exchange for the following consideration:

•a $10.5 million cash payment received on closing of the sale;

•$27.5 million in promissory notes receivable comprising:

◦$10.0 million payable (the “Second Installment”) on or before May 31, 2021; and

◦$17.5 million payable (the “Third Installment”) on or before November 30, 2021 (the “Third Installment Maturity Date”), which was extended to November 30, 2023 (note 12(a));

•a 9.9% equity interest in PGI; and

•a 1% net smelter returns (“NSR”) royalty on production from Pilar.

The fair value of the consideration totaled $47.0 million at the date of sale which included the fair values of the cash payment received on closing, the promissory note receivable of $27.5 million, the investment in PGI of $4.8 million and the 1% NSR royalty on production from Pilar of $5.8 million, net of a working capital adjustment of $1.6 million. The Company recognized a gain on the sale of $45.4 million in other income (expense) for the year ended December 31, 2021.

The Second Installment was received in May 2021. On November 30, 2021, the Third Installment maturity date was extended to November 30, 2023. The Third Installment is included within other non-current assets and is classified as a financial asset measured at amortized cost (note 12(a)).

The equity interest in PGI is included within other non-current assets and measured at FVOCI with changes in fair value recognized in OCI (note 12(b)).

The NSR royalty asset is included within mineral properties.

(d)Sale of partial interest in Solaris

On April 28, 2021, the Company sold a portion of its shareholdings in Solaris totaling 10 million units, with each unit consisting of one Solaris common share and one-half common share purchase warrant, for gross proceeds of $66.7 million. Each whole warrant entitles the holder to acquire one common share of Solaris from the Company at a price of C$10.00 until April 28, 2022. Of the gross proceeds of $66.7 million, $57.6 million was allocated to the common shares and $9.1 million was allocated to the warrants.

On disposition, the Company recognized a gain on sale of its partial interest in Solaris shares in the amount of $50.3 million in other income (expense). The fair value of the warrants granted (the “Solaris warrant liability”) was recognized as a current derivative liability measured at FVTPL with changes in fair value at the end of each reporting period recognized in other income or expense (note 15(b)(iv)).

On disposition of the 10 million common shares of Solaris, the Company’s interest in Solaris was reduced to 19.9%. As a result, the Company determined it no longer had significant influence over Solaris and accordingly discontinued the use of the equity method to account for its investment. The carrying amount of the Company’s retained investment in Solaris was reclassified from investment in associate and recognized at fair value. The fair value of the Company’s retained investment of $197.6 million consisted of $136.0 million in common shares (“Solaris Shares”) and $61.6 million in warrants (“Solaris Warrants”) which were recognized as marketable securities measured at FVOCI (note 6) and derivative assets measured at FVTPL (note 15(a)(i)), respectively. The Company recognized a gain of $186.1 million in other income (expense) on reclassification of its investment in Solaris.

(e)Acquisition of Leagold

On March 10, 2020, the Company acquired 100% of the issued and outstanding shares of Leagold at an exchange ratio of 0.331 of an Equinox Gold share for each Leagold share. Holders of Leagold options, warrants, PSUs and DSUs received equivalent Equinox Gold options, warrants, PSUs and DSUs with the number of Equinox Gold common shares issuable pursuant to such instruments adjusted by the 0.331 exchange ratio. Leagold was a gold mining company with four operating mines, one development project and one expansion project, all located in the Americas, including Los Filos in Mexico, and Fazenda, RDM, Pilar and Santa Luz in Brazil. The acquisition supported the Company’s growth strategy and enhanced the Company’s production profile.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

5. CORPORATE TRANSACTIONS (CONTINUED)

(e)Acquisition of Leagold (continued)

By virtue of the Company issuing equity instruments and the relative voting rights of Equinox Gold shareholders in the combined company post-merger, among other factors, the Company was identified as the acquirer and the transaction was accounted for as a business combination. Transaction costs incurred in respect of the acquisition totaling $5.9 million, of which $4.6 million were incurred in 2020, were expensed and presented as professional fees within general and administration expense in the consolidated statements of income.

The acquisition-date fair value of the consideration transferred consisted of the following:


Share consideration(1)	$	732,042
Option consideration(2)	19,777
Warrant consideration(3)	8,543
PSU and DSU consideration(4)	3,721
Total consideration	$	764,083

(1)The fair value of 94,635,765 common shares issued to Leagold shareholders was determined using the Company’s share price of C$10.51 ($7.74) per share on the acquisition date.

(2)The fair value of 5,728,647 replacement options issued was determined using the Black-Scholes option pricing model with the following weighted average inputs and assumptions: exercise price of C$7.77, share price of C$10.51, expected life of 2.07 years, expected volatility of 60.2%, dividend yield of 0.0%, and discount rate of 0.54%.

(3)The fair value of 16,626,569 replacement warrants issued was determined using the Black-Scholes option pricing model with the following weighted average inputs and assumptions: exercise price of C$11.14, share price of C$10.51, expected life of 0.32 years, expected volatility of 44.1%, dividend yield of 0.0%, and discount rate of 0.69%.

(4)The fair values of 369,919 replacement PSUs and 319,288 replacement DSUs issued were determined using the Leagold share price of C$3.49 ($2.57) on the acquisition date, adjusted for the 0.331 exchange ratio.

The following presents the fair values of the assets acquired and liabilities assumed:


Assets (liabilities) acquired
Cash and cash equivalents	$	55,252
Trade and other receivables	33,524
Inventories	150,078
Mineral properties, plant and equipment	1,318,785
Other assets	21,432
Accounts payable and accrued liabilities	(88,896)
Loans and borrowings and accrued interest	(323,870)
Derivative liabilities	(78,526)
Reclamation and closure cost provision	(62,238)
Deferred tax liabilities	(230,458)
Other liabilities	(31,000)
Fair value of net assets acquired	$	764,083

The Company retained an independent appraiser to assist with determination of the fair values of certain assets acquired and liabilities assumed. The fair values of mineral properties were estimated using discounted cash flow models and the fair values of plant and equipment were estimated using a combination of the replacement cost approach and the sales comparison approach. Expected future cash flows were based on estimates of future gold prices and projected future revenues, estimated quantities of mineral reserves and mineral resources, expected future production costs and capital expenditures based on life of mine plans at the acquisition date. The fair value of reclamation and closure cost provision was estimated based on the present value of the estimated future cash flows for reclamation and closure activities discounted using a credit-adjusted risk-free rate as of the acquisition date.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

5. CORPORATE TRANSACTIONS (CONTINUED)

(e)Acquisition of Leagold (continued)

Consolidated revenue for the year ended December 31, 2020 includes revenue of $360.7 million from the assets acquired in the Leagold Acquisition. Consolidated net income for the year ended December 31, 2020 includes a net loss before tax from Leagold of $24.3 million. Had the transaction occurred on January 1, 2020, pro-forma unaudited consolidated revenue and net income before tax for the year ended December 31, 2020 would have been approximately $934.9 million and $2.6 million, respectively.

6. MARKETABLE SECURITIES


	December 31, 2021		December 31, 2020
Balance – beginning of year	$	3,120	$	988
Additions	228		514
Reclassification of investment in Solaris	135,964		—
Change in fair value	101,218		1,618
Balance – end of year	$	240,530	$	3,120

On disposition of the Company's partial interest in Solaris on April 28, 2021, the Company's investment in Solaris Shares was reclassified from investment in associate to marketable securities and remeasured at its fair value of $136.0 million (note 5(d)). The Company's 19.9% equity interest in Solaris is classified as a financial asset measured at FVOCI with changes in fair value recognized in OCI. At December 31, 2021, the fair value of the Company's investment in Solaris was $238.6 million (2020 – nil). During the year ended December 31, 2021, the Company recognized a gain of $102.6 million in OCI on remeasurement of the fair value of the equity securities.

7. TRADE AND OTHER RECEIVABLES


	December 31, 2021		December 31, 2020
Trade receivables	$	14,207	$	17,172
VAT receivables(1)	24,621		18,991
Income tax receivables	8,046		10,085
Other receivables	3,386		9,624
	$	50,260	$	55,872

(1) At December 31, 2021, the Company had $12.3 million (2020 – $14.6 million) and $16.7 million (2020 – $8.2 million) of VAT receivable in Brazil and Mexico, respectively, of which $8.8 million (2020 – $6.5 million) of the Brazilian VAT is included in other non-current assets as it is expected to be recovered more than 12 months after the reporting date.

8. INVENTORIES


	December 31, 2021		December 31, 2020
Heap leach ore	$	258,197	$	268,703
Stockpiled ore	11,118		13,514
Work-in-process	17,400		14,988
Finished goods	3,395		4,500
Supplies	35,777		37,473
Total inventories	$	325,887	$	339,178

Classified and presented as:
Current	$	201,622	$	208,290
Non-current	124,265		130,888
	$	325,887	$	339,178

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

8. INVENTORIES (CONTINUED)

The non-current inventories at December 31, 2021 and 2020 relate to heap leach ore at Mesquite and Castle Mountain not expected to be recovered within 12 months of the reporting date.

During the year ended December 31, 2021, the Company recognized an increase in the provision for obsolete and slow-moving supplies inventories of $2.1 million (2020 – increase of $0.9 million) in net income. At December 31, 2021, the Company's total provision for obsolete and slow-moving supplies inventories was $14.1 million (2020 – $12.8 million).

During the year ended December 31, 2021, the Company recognized $18.1 million (2020 – nil) in write-downs of inventories to NRV, mainly relating to heap leach ore at Los Filos, included within cost of sales.

9. ASSETS HELD FOR SALE

On December 16, 2021, the Company entered into a definitive agreement to sell its Mercedes Mine to Bear Creek Mining Corporation (“Bear Creek”) (the “Transaction”) for the following consideration:

•$75 million in cash payable on closing of the Transaction;

•$25 million in cash payable within six months of closing of the Transaction;

•24,730,000 common shares of Bear Creek, representing approximately 19.9% of the issued and outstanding common shares of Bear Creek; and

•a 2% NSR royalty on production from Mercedes.

Mercedes is a producing gold-silver mine in Mexico which was acquired by the Company as part of the Premier Acquisition (note 5(a)).

The Transaction is expected to close around the end of the first quarter of 2022. At December 31, 2021, the Company concluded that the criteria for classifying Mercedes as held for sale had been met. Accordingly, the assets and liabilities relating to Mercedes have been classified as held for sale and presented separately within current assets and current liabilities, respectively, in the statement of financial position at December 31, 2021.

At December 31, 2021, the carrying amounts of the assets and liabilities of Mercedes classified as held for sale were as follows:


Assets held for sale
Cash and cash equivalents	$	4,575
Trade and other receivables	6,878
Inventories	12,935
Mineral properties, plant and equipment	183,137
Other assets	13
	207,538
Liabilities relating to assets held for sale
Accounts payable and accrued liabilities	(13,282)
Derivative liabilities	(39,986)
Reclamation and closure cost provision	(11,863)
Deferred tax liabilities	(18,084)
Other liabilities	(2,530)
	(85,745)
Net assets held for sale	$	121,793

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

9. ASSETS HELD FOR SALE (CONTINUED)

The derivative liabilities relate to a gold prepay and silver stream arrangement with a third party (the “Stream Arrangement”). Under the terms of the Stream Arrangement, the Company is required to deliver 1,000 ounces of gold quarterly, subject to adjustment based on the market price of gold, until the Company has delivered a total of 9,000 ounces. In addition, the Company is required to deliver 100% of the silver production from Mercedes until the delivery of 3.75 million ounces, and 30% of silver production thereafter at a price equal to 20% of the prevailing silver price at the time of delivery. The Company is required to deliver a minimum of 300,000 ounces of silver in each calendar year until 2.1 million ounces of silver in aggregate have been delivered. As silver production from Mercedes may not be sufficient to satisfy the obligation and the Company may be required to purchase silver on the open market or settle the obligation in cash, the Stream Arrangement was accounted for as a derivative financial liability measured at FVTPL. The fair value of the Stream Arrangement is determined based on the net present value of the expected future cash flows using a discount rate that reflects the time value of money and risks associated with the liability.

As part of the Transaction, Bear Creek will assume the outstanding obligation under the Stream Arrangement. At December 31, 2021, the Company has delivered 2,700 ounces of gold and 85,803 ounces of silver towards the Stream Arrangement.

The changes in the carrying amount of the Stream Arrangement derivative liabilities during the year ended December 31, 2021 were as follows:


Balance – December 31, 2020	$	—
Assumed in Premier Acquisition (note 5(a))	40,369
Gold and silver delivered	(6,802)
Change in fair value	6,419
Balance – December 31, 2021	$	39,986

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

10. MINERAL PROPERTIES, PLANT AND EQUIPMENT


	Mineral properties		Plant and equipment		Construction- in-progress		Exploration and evaluation assets (1)		Total
Cost
Balance – December 31, 2019	$	341,770	$	175,323	$	20,951	$	13,750	$	551,794
Leagold Acquisition (note 5(e))	909,715		380,545		28,525		—		1,318,785
Additions	89,305		35,887		53,912		—		179,104
Transfers	—		56,125		(67,746)		—		(11,621)
Disposals	—		(3,819)		—		—		(3,819)
Change in reclamation and closure cost asset	31,537		—		—		—		31,537
Balance – December 31, 2020	1,372,327		644,061		35,642		13,750		2,065,780
Premier Acquisition (note 5(a))	468,315		72,018		—		36,470		576,803
Investment in Greenstone (note 5(b))	57,739		42		—		1,297		59,078
Additions	168,231		144,213		142,869		—		455,313
Reclassified to assets held for sale (note 9)	(134,783)		(73,915)		—		—		(208,698)
Transfers	(5,438)		5,438		—		—		—
Disposals	(6,285)		(125,565)		—		—		(131,850)
Change in reclamation and closure cost asset	(16,608)		—		—		—		(16,608)
Foreign currency adjustment	(4,520)		(49)		(613)		(93)		(5,275)
Balance – December 31, 2021	$	1,898,978	$	666,243	$	177,898	$	51,424	$	2,794,543

Accumulated depreciation
Balance – December 31, 2019	$	18,722	$	21,379	$	—	$	—	$	40,101
Additions	72,012		97,083		—		—		169,095
Disposals	—		(2,139)		—		—		(2,139)
Balance – December 31, 2020	$	90,734	$	116,323	$	—	$	—	$	207,057
Additions	115,778		111,470		—		—		227,248
Reclassified to assets held for sale (note 9)	(15,586)		(9,975)		—		—		(25,561)
Transfers	(2,720)		2,720		—		—		—
Disposals	(5,204)		(106,907)				—		(112,111)
Foreign currency adjustment	—		(9)		—		—		(9)
Balance – December 31, 2021	$	183,002	$	113,622	$	—	$	—	$	296,624
Net book value
At December 31, 2020	$	1,281,593	$	527,738	$	35,642	$	13,750	$	1,858,723
At December 31, 2021	$	1,715,976	$	552,621	$	177,898	$	51,424	$	2,497,919

(1)Exploration and evaluation assets as at December 31, 2019 and 2020 have been included within mineral properties, plant and equipment in the consolidated statement of financial position to conform with the current period presentation.

During the year ended December 31, 2021, the Company capitalized $70.1 million, $66.4 million and $5.5 million of costs incurred at Santa Luz, Greenstone and Los Filos, respectively, to construction-in-progress (2020 – $45.2 million, $3.5 million, and $3.6 million of costs incurred at Castle Mountain, Santa Luz and Los Filos, respectively). In addition, the Company capitalized $1.6 million of borrowing costs incurred to construction-in-progress (2020 – nil) and $13.8 million of depreciation and depletion to mineral properties and construction-in-progress (2020 – $6.0 million).

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

10. MINERAL PROPERTIES, PLANT AND EQUIPMENT (CONTINUED)

On commencement of commercial production at Castle Mountain on November 21, 2020, the Company transferred $56.1 million and $11.6 million from construction-in-progress to plant and equipment and inventories, respectively. The Company recognized pre-production net income of $1.6 million earned during the ramp-up of Castle Mountain in the statement of income for the year ended December 31, 2020.

In addition to amounts included in construction-in-progress and exploration and evaluation and evaluation assets, mineral properties at December 31, 2021 includes $510.7 million (2020 – $115.1 million) relating to the mineral interests at Los Filos, Santa Luz and Greenstone which are currently not subject to depletion.

Certain of the Company's mining properties are subject to royalty arrangements based on their NSRs, gross revenues and other measures. At December 31, 2021, the Company's significant royalty arrangements were as follows:


Mineral property			Royalty arrangements
Mesquite			Weighted average life of mine NSR of 2%
Castle Mountain			2.65% NSR
Los Filos			3% of gross sales at Xochipala concession; 1.5% EBITDA; 0.5% gross revenues
Aurizona			1.5% of gross sales; 3-5% sliding scale NSR based on gold price
Fazenda			0.75-1.5% of gross sales
RDM			1-1.5% of gross sales

11. INVESTMENT IN ASSOCIATE

Details of the Company's investment in associate as at December 31, 2021 and 2020 are as follows:


	Principal Activity	Principal place of business	Ownership interest (%)		Fair value (1)				Carrying amount
Equity method accounted for investee			2021	2020	2021		2020		2021		2020
Solaris(2)	Exploration	Ecuador	—	26.5	$	—	$	132,026	$	—	$	22,287
i-80 Gold Corp.	Producing	USA	25.5	—	148,559		—		125,313		—

(1)The fair value of the Company's investment in i-80 Gold represents the fair value of 60.8 million i-80 Gold common shares based on the quoted market price at December 31, 2021 of C$3.09 per share, which is a Level 1 input.

(2)Effective April 28, 2021, the Company's investment in Solaris Shares and Solaris Warrants are presented in marketable securities and derivative assets, respectively (note 5(d)).

The following is a summary of the changes in the Company’s investment in Solaris previously accounted for using the equity method during the years ended December 31, 2021 and 2020:


Balance – December 31, 2019	$	7,162
Shares acquired	12,480
Dilution gain	8,033
Share of net loss	(5,388)
Balance – December 31, 2020	22,287
Share of net loss for the period of January 1 to April 28, 2021	(3,399)
Carrying value of investment sold (note 5(d))	(7,318)
Reclassification of retained interest in Solaris (note 5(d))	(11,570)
Balance – December 31, 2021	$	—

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

11. INVESTMENT IN ASSOCIATE (CONTINUED)

The following table summarizes the change in carrying amount of the Company’s investment in i-80 Gold:


Balance – December 31, 2020	$	—
Acquired in Premier Acquisition (note 5(a))	79,001
Shares acquired	40,111
Dilution gain	2,067
Share of net income	4,134
Balance – December 31, 2021	$	125,313

In connection with the Premier Acquisition (note 5(a)), the Company acquired 41.3 million shares in i-80 Gold, a US-focused gold production and development company, representing a 30% interest in i-80 Gold.

On April 7, 2021, the Company participated in the i-80 Gold private placement financing, purchasing 9,274,384 units at a price of C$2.60 per unit, for a total investment of $19.2 million. Each unit comprises one common share of i-80 Gold and one quarter of one common share purchase warrant. Each whole warrant (“i-80 Gold Warrant”) entitles the Company to acquire one common share of i-80 Gold at a price of C$3.64 until September 18, 2022. Of the $19.2 million investment, the Company allocated $18.4 million to the shares and $0.7 million to the warrants (note 15(a)(ii)).

In March 2021, the Company advanced $20.7 million to i-80 Gold as a loan. The loan was settled in exchange for the shares and warrants received in the private placement financing and a repayment by i-80 Gold of the remaining $1.5 million.

On May 27, 2021 and December 9, 2021, the Company exercised its anti-dilution right under the support agreement dated April 7, 2021 between the Company and i-80 Gold and subscribed for 5,479,536 common shares of i-80 Gold at C$2.60 per common share and 4,800,000 common shares of i-80 Gold at C$2.62 per common share, respectively, for a total investment of $21.7 million.

Summarized financial information in respect of the Company's associates as at and for the year ended December 31, 2021 and 2020, is set out below. The summarized financial information is based on amounts included in the associates' most recent available consolidated financial statements prepared in accordance with IFRS as of September 30, 2021 and 2020, respectively, adjusted for material transactions during the three months ended December 31, 2021 and 2020, respectively, and for adjustments made by the Company in applying the equity method, including fair value adjustments on acquisition of interest in the associates. The information presented as at and for the year ended December 31, 2021 relates to the Company's 25.5% interest in i-80 Gold, and the information presented as at and for the year ended December 31, 2020 is related to the Company's 26.5% interest in Solaris.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

11. INVESTMENT IN ASSOCIATE (CONTINUED)


At December 31	2021		2020
	i-80 Gold		Solaris
Cash and cash equivalents	$	51,627	$	71,973
Other current assets	55,606		322
Non-current assets	131,426		20,652
Total assets	238,659		92,947
Current financial liabilities(1)	—		439
Other current liabilities	12,956		2,702
Non-current financial liabilities	37		384
Other non-current liabilities	18,456		160
Total liabilities	31,449		3,685
Non-controlling interest	—		7,766
Net assets (100%)	207,210		81,496
Equinox Gold's share of net assets	52,814		21,585
Adjustments to Equinox Gold's share of net assets	72,499		702
Carrying amount	$	125,313	$	22,287

(1) Excludes accounts payable and accrued liabilities.


Years ended December 31	2021		2020
Revenue	$	—	$	—
Expenses(1)	(24,906)		(20,301)
Depreciation and depletion	—		(68)
Income tax expense	(200)		—
Net loss from continuing operations (100%)	(25,106)		(20,369)
Net income from discontinued operations (100%)	11,554		—
Net loss (100%)	(13,552)		(20,369)
Other comprehensive income (loss) (100%)	—		—
Total comprehensive loss (100%)	(13,552)		(20,369)
Equinox Gold's share of net loss and comprehensive loss	(3,454)		(5,388)
Adjustments to Equinox Gold's share of net loss and comprehensive loss	7,588		—
Equinox Gold's share of net income (loss)	4,134		(5,388)
Equinox Gold's share of total comprehensive income (loss)	$	4,134	$	(5,388)

(1) Excludes depreciation and depletion.

12. OTHER NON-CURRENT ASSETS


	December 31, 2021		December 31, 2020
Receivable from asset sales, net of loss allowance(a)	$	10,321	$	3,907
Investment in PGI(b)	2,294		—
Derivative assets(a) (note 15(a))	218		—
VAT receivable	8,845		6,522
Other	3,935		3,045
	$	25,613	$	13,474

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

12. OTHER NON-CURRENT ASSETS (CONTINUED)

(a)Receivable from PGI

In connection with the sale of Pilar (note 5(c)), the Company has a note receivable from PGI for the Third Installment. On November 30, 2021, the Company and PGI entered into an amending agreement (the “Amending Agreement”) that extended the Third Installment Maturity Date from November 30, 2021 to November 30, 2023. In addition, pursuant to the Amending Agreement, commencing on June 30, 2022, the Company will receive four quarterly deliveries of 300 ounces of refined gold each, subject to adjustments based on the market price of gold. During the year ended December 31, 2021, the Company recognized total impairment loss of $7.5 million on the note receivable in other income (expense). At December 31, 2021, the carrying amount of the Third Installment note receivable was $7.6 million.

The amounts owing under the Third Installment are secured by a pledge of all the issued and outstanding shares of the corporation that owns Pilar; credit rights, accounts, material contracts, equipment, machinery, inventory, gold production, real estate properties and mining concessions relating to Pilar; and a conditional assignment of mineral rights.

At December 31, 2021, the fair value of the gold deliveries was $1.0 million, of which $0.7 million is included within current derivative assets.

(b)Investment in PGI

The Company has an equity interest in PGI (note 5(c)) which is classified as a financial asset measured at FVOCI with changes in fair value recognized in OCI. During the year ended December 31, 2021, the Company recognized a loss of $2.5 million in OCI on remeasurement of the fair value of the equity securities.

13. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES


	December 31, 2021		December 31, 2020
Trade payables	$	136,678	$	99,197
Capital related	49,038		7,056
VAT and income taxes payable	4,400		23,900
Accrued interest	—		390
	$	190,116	$	130,543

14. LOANS AND BORROWINGS


	December 31, 2021		December 31, 2020
Credit Facility(a)	$	279,621	$	289,910
2020 Convertible Notes(b)	129,320		126,645
2019 Convertible Notes(b)	131,741		128,686
Total loans and borrowings	$	540,682	$	545,241

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

14. LOANS AND BORROWINGS (CONTINUED)

The following is a reconciliation of the changes in the Company's loans and borrowings balance during the years ended December 31, 2021 and 2020 to cash flows arising from financing activities:


	2021		2020
Balance – beginning of year(1)	$	545,417	$	263,437
Financing cash flows:
Draw down on Credit Facility	—		379,680
Debt component of Convertible Notes issued	—		127,605
Transaction costs	—		(10,392)
Repayment of loans and borrowings	(30,983)		(546,274)
Interest paid	(22,112)		(26,536)
Other changes:
Debt assumed in Premier Acquisition (note 5(a))	17,649		—
Debt assumed in Leagold Acquisition (note 5(e))	—		323,870
Interest expense	30,711		36,658
Modification gain on Credit Facility	—		(2,631)
Balance – end of year(1)	540,682		545,417
Less: Accrued interest	—		(176)
Loans and borrowings – end of year	$	540,682	$	545,241

Classified and presented as:
Current	$	26,667	$	13,333
Non-current	514,015		531,908
	$	540,682	$	545,241

(1) Includes accrued interest.

(a)Credit Facility

In March 2020, the Company amended its $130 million corporate revolving credit facility with a syndicate of lenders led by The Bank of Nova Scotia, Société Générale, Bank of Montreal and ING Capital LLC. The Credit Facility is comprised of a $400 million Revolving Facility and $100 million Term Loan.The Company recognized a gain on modification of debt of $2.6 million in other expense to reflect the adjusted amortized cost of the drawn portion of the Revolving Facility. Transaction costs of $9.2 million were recognized as a reduction to the carrying amount of the Credit Facility. During the year ended December 31, 2020, the Company drew down $380 million on the Credit Facility. In August 2020, the Company repaid $200 million of the principal under the Revolving Facility and recognized $2.7 million in finance expense due to the accelerated recognition of deferred financing costs as a result of the change in timing of cash flows.

The Credit Facility bears interest at an annual rate of LIBOR plus 2.50% to 3.75%, based on the Company's leverage ratio. The Credit Facility contains terms that provide for the replacement of the applicable current benchmark rate with an alternate benchmark rate based on SOFR or another alternate benchmark rate when the current benchmark rate ceases to exist. The Revolving Facility matures on March 8, 2024, at which date it must be repaid in full, and the Term Loan matures on March 10, 2025 with quarterly repayments equal to 6.67% of principal beginning September 30, 2021 through to maturity.

The carrying amount of debt outstanding will be accreted to the principal amount over the respective terms of the Revolving Facility and Term Loan using a weighted average effective interest rate of 4.40%. At December 31, 2021, the carrying amounts of the Revolving Facility and Term Loan were $193.8 million and $85.8 million, respectively (2020 – $191.3 million and $98.6 million, respectively).

The Credit Facility is secured by a first-ranking security interest over all present and future property and assets of the Company and its material subsidiaries, and the Company's present and future equity interests in Greenstone. The Credit Facility is subject to standard conditions and covenants, including maintenance of debt service coverage ratio, leverage ratio and minimum liquidity of $50 million. As at December 31, 2021 and 2020, the Company was in compliance with these covenants.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

14. LOANS AND BORROWINGS (CONTINUED)

(b)Convertible Notes

In April 2019, the Company issued $139.7 million in Convertible Notes (the “2019 Notes”) to Mubadala Investment Company (“Mubadala”) and Pacific Road Resources Funds (“Pacific Road”) (the “2019 Notes”). The 2019 Notes mature on April 12, 2024 and bear interest at a fixed rate of 5% per year payable quarterly in arrears. The 2019 Notes are convertible at the holder's option into common shares of the Company at a fixed conversion price of $5.25 per share.

In March 2020, the Company issued $139.3 million in Convertible Notes (the “2020 Notes”) to Mubadala and Pacific Road. The 2020 Notes mature on March 10, 2025 and bear interest at a fixed rate of 4.75% per year payable quarterly in arrears. The 2020 Notes are convertible at the holder's option into common shares of the Company at a fixed conversion price of $7.80 per share.

Gross proceeds from the 2020 Notes of $139.3 million was allocated to the debt and equity components. The fair value of the debt portion of $127.6 million was estimated using a discounted cash flow model based on an expected term of five years and a discount rate of 6.9%. The residual of $8.6 million ($11.7 million net of deferred tax expense of $3.1 million) was recognized in other equity reserves. Transaction costs of $3.3 million were incurred and allocated on a pro-rata basis with $3.0 million allocated to the debt component and $0.3 million allocated to the equity component.

The debt component of the 2019 Notes and 2020 Notes, net of transaction costs, will be accreted to the principal amount over their respective terms using an effective rate of 7.5% and 7.3%, respectively.

Holders of the 2019 Notes and 2020 Notes may exercise their conversion option at any time, provided that the holder owns less than 20% of the outstanding common shares of the Company. The Company has call options that may be exercised on or after October 11, 2022 in relation to the 2019 Notes and on or after March 10, 2023 in relation to the 2020 Notes, which are exercisable if the 90-day volume weighted average trading price of the Company's common shares exceeds $6.83 and $10.14, respectively, for a period of 30 consecutive days. Upon exercise of the option by the Company, the holders are required to either (i) exercise the conversion option on the remaining principal outstanding or (ii) demand cash payment from the Company subject to a predetermined formula based on the respective conversion price per share and the Company's share price at the time of redemption.

The 2019 Notes and 2020 Notes are secured by a second ranking security interest over all present and future assets of the Company and its material subsidiaries, and the Company's present and future equity interests in Greenstone, and are subordinate to the Credit Facility.

15. DERIVATIVE FINANCIAL INSTRUMENTS

(a)Derivative assets

The following is a summary of the Company's derivative assets measured at FVTPL at December 31, 2021:


	2021
Solaris Warrants(i)	$	122,919
i-80 Gold Warrants(ii)	581
Gold deliveries (note 12(a))	952
	$	124,452

Classified and presented as:
Current	$	124,234
Non-current(1) (note 12(a))	218
	$	124,452

(1) Represents the estimated fair value of the gold deliveries expected to be received from PGI after 12 months from the reporting date.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

15. DERIVATIVE FINANCIAL INSTRUMENTS (CONTINUED)

(a)Derivative assets (continued)

(i)Solaris Warrants

The Company holds 10,218,750 warrants that are each exercisable into one common share of Solaris, with exercise prices ranging from C$1.20 to C$6.75 per share, and expiry dates ranging between November 2022 and May 2023. The fair value of the Solaris Warrants at December 31, 2021 was $122.9 million. The fair value of the Solaris Warrants at December 31, 2021 was determined using the Black Scholes option pricing model with the following weighted average assumptions:


	2021
Risk-free rate	0.78	%
Expected life	1.0 year
Expected volatility	62.8	%
Expected dividend	0.0	%
Exercise price (C$)	$1.74
Share price (C$)	$16.94

During the year ended December 31, 2021, the Company recognized a gain of $61.3 million on revaluation of the Solaris Warrants in other income (expense).

(ii)i-80 Gold Warrants

The Company holds 2,318,596 warrants that are each exercisable into one common share of i-80 Gold until September 18, 2022 (note 11). The fair value of the i-80 Gold Warrants at December 31, 2021 was $0.6 million. The fair value of the i-80 Gold Warrants at December 31, 2021 was determined using the Black Scholes option pricing model with the following assumptions:


	2021
Risk-free rate	0.53	%
Expected life	0.72 years
Expected volatility	48.4	%
Expected dividend	0.0	%
Exercise price (C$)	3.64
Share price (C$)	3.09

During the year ended December 31, 2021, the Company recognized a loss of $0.2 million on revaluation of the i-80 Gold Warrants in other income (expense).

(b)Derivative liabilities

The following is a summary of the Company's derivative liabilities at December 31, 2021 and 2020:


	2021		2020
Gold collars and forward contracts(i)	$	33,336	$	91,393
Foreign exchange contracts(ii)	12,061		12,507
Equinox Gold warrant liability(iii)	5,177		50,666
Solaris warrant liability(iv)	27,697		—
Contingent consideration – Greenstone(v)	6,586		—
	$	84,857	$	154,566

Classified and presented as:
Current	$	77,699	$	63,993
Non-current	7,158		90,573
	$	84,857	$	154,566

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

15. DERIVATIVE FINANCIAL INSTRUMENTS (CONTINUED)

(b)Derivative liabilities (continued)

(i)Gold collar and forward contracts

As part of the Leagold Acquisition (note 5(e)), the Company assumed gold collar contracts with put and call strike prices of $1,325 and $1,425 per ounce, respectively, for 3,750 ounces per month to September 2022. The Company also assumed forward contracts with an average fixed gold price of $1,350 per ounce for 4,583 ounces per month to September 2022. At December 31, 2021, the Company had 33,750 ounces and 41,250 ounces remaining to be delivered under its gold collar and forward contracts, respectively.

The gold collar and forward contracts have not been designated as hedges and are measured at fair value, determined based on forward gold prices, at the end of each reporting period with changes in fair value recognized in net income or loss.

The following table summarizes the changes in the gold collar and forward contracts outstanding during the years ended December 31, 2021 and 2020:


	2021		2020
Balance – beginning of year	$	91,393	$	—
Assumed in Leagold Acquisition (note 5(e))	—		78,526
Change in fair value	(16,605)		48,091
Settlements	(41,452)		(35,224)
Balance – end of year	$	33,336	$	91,393

The fair value of the gold collar and forward contracts at December 31, 2021 was a liability of $33.3 million, which is presented as current derivative liabilities (2020 – $91.4 million, of which $51.8 million is presented as current derivative liabilities).

(ii)Foreign exchange contracts

Certain of the Company's expenditures at its Brazilian and Mexican operations are denominated in the Brazilian Réal (“BRL”) and the Mexican Peso (“MXN”), respectively. The Company has implemented a foreign currency exchange risk management program to reduce its exposure to fluctuations in the value of the BRL and MXN relative to the US dollar.

At December 31, 2021, the Company had in place USD:BRL and USD:MXN put and call options with the following notional amounts, weighted average rates and maturity dates:


	USD notional amount				Call options' weighted average strike price	Put options' weighted average strike price
Currency	Within 1 year		1-2 years
BRL	$	151,390	$	8,039	4.92	5.82
MXN	71,000		5,000		20.54	23.68

The foreign exchange contracts have not been designated as hedges and are measured at fair value, determined based on forward foreign exchange rates, at the end of each reporting period with changes in fair value recognized in net income or loss.

The following table summarizes the changes in the foreign exchange contracts outstanding during the years ended December 31, 2021 and 2020:


	2021		2020
Balance – beginning of year	$	12,507	$	(1,639)
Change in fair value	4,410		14,731
Settlements	(4,856)		(585)
Balance – end of year	$	12,061	$	12,507

The fair value of the foreign exchange contracts at December 31, 2021 was a liability of $12.1 million (2020 – $12.5 million), of which $11.5 million is presented as current derivative liabilities (2020 – $12.2 million).

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

15. DERIVATIVE FINANCIAL INSTRUMENTS (CONTINUED)

(b)Derivative liabilities (continued)

(iii)Equinox Gold warrant liability

As the exercise price of the Company's share purchase warrants is fixed in Canadian dollars, the Company will receive a variable amount of cash in terms of the Company's US dollar functional currency upon exercise of the warrants by the holders. Accordingly, the warrants are accounted for as derivative financial liabilities measured at FVTPL with changes in fair value recognized in net income or loss.

The following table summarizes the changes in the Company's share purchase warrants outstanding during the years ended December 31, 2021 and 2020:


	Number of warrants	Weighted average exercise price (C$)
Outstanding – December 31, 2019	24,051,190	$	12.00
Issued in Leagold Acquisition (note 5(e))	16,626,569	11.14
Exercised	(20,976,625)	9.48
Expired	(675,976)	13.16
Outstanding – December 31, 2020	19,025,158	$	14.00
Issued in Premier Acquisition (note 5(a))	393,400	10.42
Exercised	(1,361,549)	8.42
Expired	(16,387,492)	14.92
Outstanding – December 31, 2021	1,669,517	$	8.69

The following table summarizes information about the Company's outstanding share purchase warrants at December 31, 2021:


Range of exercise price (C$)	Number of warrants(2)	Weighted average exercise price (C$)	Expiry dates
$5.05 - $5.30(1)	614,117	5.30	December 2022 - May 2023
$10.42 - $10.81	1,055,400	10.66	January 2022 - March 2022
	1,669,517	8.69

(1) 614,117 warrants with a weighted average exercise price of C$5.30 are exercisable into one common share of Equinox Gold and one-quarter of a common share of Solaris. Equinox Gold will receive nine-tenths of the proceeds from the exercise of each of these warrants and the remaining proceeds will be paid to Solaris.

(2) At December 31, 2021, all of the Company's outstanding warrants were non-traded.

The changes in the carrying amounts of the Company's outstanding share purchase warrants during the years ended December 31, 2021 and 2020 were as follows:


	2021		2020
Balance – beginning of year	$	50,666	$	56,146
Issued in Premier Acquisition (note 5(a))	505		—
Issued in Leagold Acquisition (note 5(e))	—		8,543
Exercised	(4,100)		(43,885)
Change in fair value	(41,894)		29,862
Balance – end of year	$	5,177	$	50,666

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

15. DERIVATIVE FINANCIAL INSTRUMENTS (CONTINUED)

(b)Derivative liabilities (continued)

(iii)Equinox Gold warrant liability (continued)

The fair values of the Company's issued and outstanding non-traded warrants at December 31, 2021 and 2020 were determined using the Black Scholes option pricing model with the following weighted average inputs:


	2021			2020
Risk-free rate	0.34		%	0.18		%
Expected life	0.61 years			1.01 years
Expected volatility	46.8		%	47.1		%
Expected dividend	0.0		%	0.0		%
Share price (C$)	$	11.60		$	14.02

The fair value of the Company's outstanding share purchase warrants that were trading at December 31, 2020 was determined based on their quoted market price of C$0.58.

(iv)Solaris warrant liability

In connection with the sale of the Company's partial interest in Solaris, the Company granted five million share purchase warrants to the buyer (note 5(d)), with each warrant exercisable into one common share of Solaris held by the Company until April 28, 2022. The warrants are accounted for as current derivative financial liabilities measured at FVTPL. The fair value of the Solaris warrant liability at December 31, 2021 of $27.7 million was determined using the Black Scholes option pricing model with the following weighted average inputs:


	2021
Risk-free rate	0.09	%
Expected life	0.32 years
Expected volatility	53.7	%
Expected dividend	0.0	%
Share price (C$)	$16.94

During the year ended December 31, 2021, the Company recognized a loss of $18.6 million (2020 – nil) on revaluation of the Solaris warrant liability in other income (expense).

(v)Contingent consideration - Greenstone

As part of the consideration for the Company’s acquisition of an additional 10% interest in Greenstone in April 2021 (note 5(b)), the Company assumed contingent payment obligations. The obligation to deliver approximately 2,200 ounces of refined gold, the cash equivalent value of such refined gold, or a combination thereof, after each production milestone of 250,000 ounces, 500,000 ounces and 700,000 ounces from Greenstone has been accounted for as a derivative financial liability measured at FVTPL. The fair value of the contingent consideration is determined based on the net present value of the projected cash outflows associated with the contingent payments at the milestone dates using a market-based discount rate that reflects the risk associated with the delivery of the contingent consideration.

At December 31, 2021, the fair value of the derivative liability was $6.6 million (2020 – nil). During the year ended December 31, 2021, the Company recognized a loss of $0.9 million (2020 – nil) on revaluation of the derivative liability in other income (expense).

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

16. RECLAMATION AND CLOSURE COST PROVISION


	USA		Mexico		Brazil		Canada		Total
Balance – December 31, 2019	$	22,335	$	—	$	7,894	$	—	$	30,229
Assumed in Leagold Acquisition (note 5(e))	—		32,878		29,360		—		62,238
Accretion	185		179		1,845		—		2,209
Change in estimates	4,662		16,634		10,241		—		31,537
Reclamation expenditures	(71)		(49)		(276)		—		(396)
Foreign exchange gain	—		—		(5,026)		—		(5,026)
Balance – December 31, 2020	27,111		49,642		44,038		—		120,791
Assumed in Premier Acquisition (note 5(a))	—		11,850		—		1,631		13,481
Disposals	—		—		(7,895)		—		(7,895)
Accretion	362		3,715		2,434		24		6,535
Change in estimates	1,001		(18,943)		410		924		(16,608)
Reclamation expenditures	—		(277)		(409)		—		(686)
Reclassified to assets held for sale (note 9)	—		(11,863)		—		—		(11,863)
Foreign exchange gain	—		(2,221)		(2,372)		(14)		(4,607)
Balance – December 31, 2021	$	28,474	$	31,903	$	36,206	$	2,565	$	99,148

At December 31							2021		2020
Classified and presented as:
Current(1)							$	3,583	$	3,688
Non-current							95,565		117,103
Total reclamation and closure cost provision							$	99,148	$	120,791

(1) Included in other current liabilities.

The Company's environmental permits require it to reclaim any land disturbed during mine development, construction and operations. The majority of these reclamation costs are expected to be incurred subsequent to the end of the operation to which they relate. The Company's provision for reclamation and closure cost represents management's best estimate of the future reclamation and mine closure activities based on the level of known disturbance at the reporting date, known legal requirements and internal and external cost estimates.

The Company measures the provision at the expected value of future cash flows using inflation rates of 2.0% to 3.5% (2020 – 2.0% to 3.5%) and discounted to the present value using discount rates of 1.3% to 8.7% (2020 – 0.9% to 6.9%) depending on the region in which the costs will be incurred. At December 31, 2021, the total undiscounted cash flows of the Company's reclamation and closure cost provisions was $182.7 million (2020 – $167.1 million).

The Company's subsidiary, Western Mesquite Mines Inc., is required to post security for reclamation and closure cost with Imperial County, California as lead agency under the California Surface Mining and Reclamation Act, and for pit backfill with the California State Lands Commission under a public/private land lease agreement. At December 31, 2021, the Company has met its security requirements in the form of bonds posted through surety underwriters totaling $27.7 million (2020 – $0.3 million).

17. OTHER NON-CURRENT LIABILITIES


	December 31, 2021		December 31, 2020
Provision for legal matters (note 34(a))	$	11,647	$	13,241
Lease liabilities (note 18(b))	26,943		9,949
Cash-settled share-based payments (note 19(c))	1,362		3,992
Other liabilities	10,562		5,587
	$	50,514	$	32,769

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

18. LEASES

(a)Right-of-use assets

The Company's right-of-use assets mainly relate to leased mobile mining equipment which are included in plant and equipment within mineral properties, plant and equipment in the consolidated statement of financial position (note 10). The following table presents the changes in the carrying amount of the Company's right-of-use assets during the years ended December 31, 2021 and 2020:


	2021		2020
Balance – beginning of year	$	16,969	$	1,121
Acquired in Leagold Acquisition (note 5(e))	—		10,704
Additions	51,644		13,668
Depreciation	(15,906)		(8,524)
Balance – end of year	$	52,707	$	16,969

(b)Lease liabilities

The following is a reconciliation of the changes in the Company's lease liabilities balance to cash flows arising from financing activities:


	2021		2020
Balance – beginning of year	$	18,884	$	1,349
Financing cash flows:
Lease payments	(24,309)		(6,667)
Other changes:
Additions	48,687		13,668
Lease liabilities assumed in Leagold Acquisition (note 5(e))	—		10,922
Interest expense	2,115		1,439
Unrealized foreign exchange gain	(280)		(1,827)
Balance – end of year	$	45,097	$	18,884

Classified and presented as:
Current(1)	$	18,154	$	8,935
Non-current(2)	26,943		9,949
	$	45,097	$	18,884

(1) Included in other current liabilities.

(2) Included in other non-current liabilities.

In February 2021, the Company entered into a three-year lease agreement for the use of mining equipment to replace part of the Company's mining fleet at Mesquite. The equipment was delivered between February and May 2021 and the Company recognized total additions of $39.8 million to right-of-use assets with a corresponding increase to lease liabilities. Under the terms of the agreement, the Company makes quarterly fixed payments over the lease term.

In June 2020, the Company entered into a lease agreement for the use of mining equipment in relation to contract mining at Castle Mountain for a period of four years. On commencement of the lease, the Company recognized a $13.4 million addition to right-of-use assets with a corresponding increase to lease liabilities. Under the terms of the agreement, the Company makes fixed payments and additional variable lease payments depending on the usage of the assets over the lease term.

19. SHARE CAPITAL AND SHARE-BASED PAYMENTS

(a)Authorized capital

The Company is authorized to issue an unlimited number of common shares with no par value.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

19. SHARE CAPITAL AND SHARE-BASED PAYMENTS (CONTINUED)

(b)Share issuances

In addition to the common shares issued as consideration for the Premier Acquisition (note 5(a)) (2020 – Leagold Acquisition (note 5(e)) and on exercise of warrants and stock options and settlement of RSUs and pRSUs (notes 15(b)(iii) and 19(c)), the Company had the following shares issuances during the years ended December 31, 2021 and 2020:

(i)In April 2021, the Company completed a non-brokered private placement of 7,500,000 common shares at a price of C$10.00 ($7.95) per share for gross proceeds of C$75.0 million ($59.6 million), of which C$40.4 million ($32.1 million) of common shares were issued to the Company's executives and directors.

(ii)In March and April 2020, the Company completed a non-brokered private placement of 6,934,438 common shares of the Company at a price of $6.18 per share for gross proceeds of $42.9 million, of which $36.0 million was issued to the Company's Chairman, Ross Beaty.

(c)Share-based compensation plans

(i)Restricted share units

Under the terms of the Equinox Gold Restricted Share Unit Plan (the “RSU Plan”), the Board of Directors may, from time to time, grant to directors, officers, employees, and consultants, RSUs and pRSUs in such numbers and for such terms as may be determined by the Board of Directors.

Equity-settled RSUs and pRSUs

Equity-settled RSUs are settled in the Company's common shares after the vesting conditions are met, which is generally within three years of the date of grant.

The number of awards vested under equity-settled pRSUs are subject to a multiplier of 0% to 300% of the number of pRSUs granted based on the achievement of specified non-market conditions, including gold production targets, or market conditions, including the Company's total shareholder return as compared to the S&P Global Gold Index or the VanEck Vectors Junior Gold Miners ETF (“GDXJ”) Index over a three-year comparison period. Share-based compensation expense related to pRSUs with non-market performance conditions is recognized over the expected vesting period with the cumulative amount recognized adjusted at the end of each reporting period to reflect the change, if any, in the number of pRSUs expected to vest and expected vesting period based on expected performance. Share-based compensation expense related to pRSUs that vest based on market conditions is recognized over the three-year vesting period based on the grant date fair value of the award.

The following table summarizes the changes in the Company's equity-settled RSUs and pRSUs outstanding during the years ended December 31, 2021 and 2020:


	Number of RSUs	Number of pRSUs
Outstanding – December 31, 2019	803,047	1,112,378
Granted	375,017	213,600
Settled	(463,608)	(179,938)
Forfeited	(4,750)	(740)
Outstanding – December 31, 2020	709,706	1,145,300
Granted	603,607	421,155
Settled	(428,065)	(295,200)
Forfeited	(41,936)	(1,100)
Outstanding – December 31, 2021	843,312	1,270,155

During the year ended December 31, 2021, the Company granted 0.6 million equity-settled RSUs (2020 – 0.4 million) and 0.4 million pRSUs (2020 – 0.2 million) to directors, officers and employees. The weighted average grant date fair value of the RSUs and pRSUs granted during the year ended December 31, 2021 was $9.26 (2020 – $8.21).

During the year ended December 31, 2021, the Company settled 0.3 million of pRSUs that were subject to a weighted average multiplier of 1.6 (2020 – 0.2 million subject to a weighted average multiplier of 1.0).

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

19. SHARE CAPITAL AND SHARE-BASED PAYMENTS (CONTINUED)

(c)Share-based compensation plans (continued)

(i)Restricted share units (continued)

Cash-settled RSUs and pRSUs

Under the terms of the RSU Plan, certain RSUs and pRSUs granted to employees entitle the holder to a cash payment equal to the number of RSUs granted, multiplied by the quoted market value of the Company's common shares on completion of the vesting period (the “cash-settled RSUs and cash-settled pRSUs”). The cash-settled pRSUs are subject to a multiplier of 0% to 200% based on the Company's total shareholder return as compared to the S&P Global Gold Index over a three-year comparison period. The share-based compensation expense related to cash-settled RSUs and pRSUs is recognized over the two-year and three-year vesting period, respectively. The amount of share-based compensation expense is adjusted at each reporting period to reflect the change in quoted market price of the Company's common shares and the number of RSUs and pRSUs expected to vest.

The following table summarizes the changes in the Company's cash-settled RSUs and pRSUs outstanding during the years ended December 31, 2021 and 2020:


	Number of RSUs	Number of pRSUs
Outstanding – December 31, 2019	168,800	—
Granted	78,900	—
Settled	(65,900)	—
Forfeited	(37,000)	—
Outstanding – December 31, 2020	144,800	—
Granted	67,800	7,700
Settled	(105,350)	—
Forfeited	—	—
Outstanding – December 31, 2021	107,250	7,700

During the year ended December 31, 2021, the Company granted 0.1 million total cash-settled RSUs and pRSUs (2020 – 0.1 million) with a weighted average grant date fair value of $10.05 (2020 – $7.49).

The total fair value of cash-settled RSUs and pRSUs outstanding at December 31, 2021 was $0.7 million (2020 – $1.2 million), of which $0.5 million and $0.2 million (2020 – $0.8 million and $0.4 million) are included in other current liabilities and other non-current liabilities, respectively.

(ii)Performance share units

In connection with the Leagold Acquisition (note 5(e)), the Company issued 0.4 million cash-settled replacement PSUs. Awards vested were subject to a multiplier of 50% to 150% of the number of PSUs granted based on the Company's total shareholder return compared to the GDXJ Index over a three-year comparison period ended December 31, 2021. Share-based compensation expense related to the PSUs was recognized over the vesting period with the amount recognized being adjusted at the end of each reporting period to reflect the change in the quoted market price of the Company's common shares, the number of PSUs expected to vest, and the expected performance factor at such date.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

19. SHARE CAPITAL AND SHARE-BASED PAYMENTS (CONTINUED)

(c)Share-based compensation plans (continued)

(ii)Performance share units (continued)

The following table summarizes the changes in the Company's PSUs outstanding during the years ended December 31, 2021 and 2020:


			Number of PSUs
Outstanding – December 31, 2019			—
Issued in Leagold Acquisition (note 5(e))			369,915
Settled			(72,533)
Forfeited			(14,506)
Outstanding – December 31, 2020			282,876
Settled			(249,028)
Forfeited			(33,848)
Outstanding – December 31, 2021			—

At December 31, 2021, all the PSUs issued had either vested or were forfeited. The total fair value of PSUs outstanding at December 31, 2020 was $2.3 million and was included in other non-current liabilities.

(iii)Deferred share units

Under the terms of the Equinox Gold Deferred Share Unit Plan (the “DSU Plan”), non-executive directors may elect to receive all or a portion of their annual compensation in the form of DSUs which are linked to the value of the Company's common shares. DSUs are issued on a quarterly basis under the terms of the DSU Plan, based on the five-day volume weighted average trading price of the Company's common shares at the date of grant. DSUs vest immediately and are redeemable in cash.

The following table summarizes the changes in the Company's DSUs outstanding during the years ended December 31, 2021 and 2020:


			Number of DSUs
Outstanding – December 31, 2019			—
Issued in Leagold Acquisition			319,286
Granted			8,266
Redeemed			(202,115)
Outstanding – December 31, 2020			125,437
Granted			51,046
Outstanding – December 31, 2021			176,483

In connection with the Leagold Acquisition (note 5(e)), the Company issued 0.3 million replacement DSUs to non-executive directors of Leagold. The DSUs are redeemable for 90 days from the date a director ceases to be a member of the Board.

The weighted average grant date fair value of DSUs granted during the year ended December 31, 2021 was $7.63 (2020 – $11.01).

The total fair value of DSUs outstanding as at December 31, 2021 was $1.2 million (2020 – $1.3 million) and is included in other non-current liabilities.

(iv)Stock options

The Company has an incentive stock option plan (the “Option Plan”) whereby the Company may grant stock options to eligible employees, officers, directors and consultants with the exercise price, expiry date, and vesting conditions determined by the Board of Directors. All stock options are equity settled. The Option Plan provides for the issuance of up to 10% of the Company's issued common shares as at the date of the grant.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

19. SHARE CAPITAL AND SHARE-BASED PAYMENTS (CONTINUED)

(c)Share-based compensation plans (continued)

(iv)Stock options (continued)

The following table summarizes the changes in the Company's outstanding stock options during the years ended December 31, 2021 and 2020:


	Number of options	Weighted average exercise price (C$)
Outstanding – December 31, 2019	2,675,113	$	5.99
Issued in Leagold Acquisition (note 5(e))	5,728,647	7.77
Granted	156,200	11.80
Exercised	(5,559,803)	7.38
Expired/forfeited	(81,087)	8.52
Outstanding – December 31, 2020	2,919,070	$	7.09
Issued in Premier Acquisition (note 5(a))	2,813,747	7.27
Exercised	(1,833,661)	5.77
Expired/forfeited	(315,713)	15.04
Outstanding – December 31, 2021	3,583,443	$	7.14

During the year ended December 31, 2020, the Company granted 0.2 million stock options to employees, officers, directors and consultants of the Company. The fair value of stock options granted during the year ended December 31, 2020 was estimated using the Black-Scholes option pricing model with the following weighted average inputs:


	2020
Exercise price and share price (C$)	$	11.80
Risk-free interest rate	0.4		%
Expected volatility	65.2		%
Expected dividend yield	0.0		%
Expected life	5.0 years

The weighted average share price at the date of exercise of stock options during the year ended December 31, 2021 was $10.87 (2020 – $13.36).

The following table summarizes information about the Company's outstanding and exercisable stock options at December 31, 2021:


	Options Outstanding				Options Exercisable
Range of exercise price (C$)	Number of options	Weighted average exercise price (C$)		Weighted average remaining contractual life (years)	Number of options	Weighted average exercise price (C$)
$1.89 - $2.99	33,100	$	1.89	4.53	33,100	$	1.89
$3.00 - $4.99	493,380	4.56		3.18	493,380	4.56
$5.00 - $6.99	1,575,999	5.50		1.50	1,575,999	5.50
$7.00 - $8.99	640,284	8.61		0.34	640,284	8.61
$9.00 - $17.15	840,680	10.80		1.17	765,030	10.70
	3,583,443	$	7.14	1.47	3,507,793	$	7.04

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

19. SHARE CAPITAL AND SHARE-BASED PAYMENTS (CONTINUED)

(d)Share-based compensation

The following table summarizes the Company's share-based compensation recognized during the years ended December 31, 2021 and 2020:


	2021		2020
Stock options	$	1,676	$	618
RSUs and pRSUs	6,640		3,320
PSUs	(224)		3,882
DSUs	(492)		320
Total share-based compensation	$	7,600	$	8,140

Recognized in the consolidated financial statements as follows:
Equity-settled:
General and administration expense	$	6,773	$	4,449
Operating expense	927		376
Capitalized within construction-in-progress	273		—
Cash-settled:
General and administration (recovery) expense	(691)		2,302
Operating expense	290		708
Exploration expense	28		305
Total share-based compensation	$	7,600	$	8,140

20. RESERVES

The following table summarizes the changes in the Company's reserves during the years ended December 31, 2021 and 2020:


	Share-based compensation		Equity component of Convertible Notes		Other		Total
Outstanding – December 31, 2019	$	14,356	$	10,217	$	3,386	$	27,959
Options issued in Leagold Acquisition	19,777		—		—		19,777
Equity component of Convertible Notes issued	—		8,322		—		8,322
Exercise of stock options and settlement of RSUs and pRSUs	(22,104)		—		—		(22,104)
Share-based compensation	4,825		—		—		4,825
Outstanding – December 31, 2020	16,854		18,539		3,386		38,779
Options issued in Premier Acquisition	8,155		—		—		8,155
Exercise of stock options and settlement of RSUs and pRSUs	(7,869)		—		—		(7,869)
Share-based compensation	7,973		—		—		7,973
Outstanding – December 31, 2021	$	25,113	$	18,539	$	3,386	$	47,038

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

21. REVENUE

Revenue from contracts with customers during the years ended December 31, 2021 and 2020 disaggregated by metal were as follows:


	2021		2020
Gold	$	1,079,321	$	844,076
Silver	2,965		1,312
Total revenue	$	1,082,286	$	845,388

(a)Gold offtake arrangement

As part of the Leagold Acquisition (note 5(e)), the Company assumed offtake arrangements with Orion Mine Finance (“Orion”) that provide for gold offtake of 50% of the gold production from Los Filos and 35% of the gold production from the Fazenda, RDM, Pilar and Santa Luz mines at market prices, until a cumulative delivery of 1.1 million ounces and 0.7 million ounces, respectively, to Orion has been achieved. At December 31, 2021, the Company had delivered a total of 0.3 million ounces and 0.2 million ounces, respectively, to Orion under the terms of the offtake arrangements.

(b)Silver streaming arrangement

As part of the Leagold Acquisition, the Company assumed a silver streaming agreement with Wheaton Precious Metals Corp. (“WPM”) under which the Company must sell to WPM a minimum of 5.0 million payable silver ounces produced by Los Filos from August 5, 2010 to the earlier of the termination of the agreement and October 15, 2029 at the lesser of $3.90 per ounce and the prevailing market price, subject to an inflationary adjustment. The contract price is revised each year on the anniversary date of the contract and was $4.53 per ounce at December 31, 2021. At December 31, 2021, a total of 2.0 million ounces had been delivered to WPM under the terms of the streaming agreement. As the Company's obligation under the silver stream agreement will be satisfied through the delivery of silver ounces produced by Los Filos, it was determined that the contract was entered into and continues to be held for the purpose of the delivery of a non-financial item in accordance with the Company's expected sale or usage requirements, and accordingly not accounted for as a financial instrument.

22. OPERATING EXPENSE

Operating expense during the years ended December 31, 2021 and 2020 were comprised of the following expenses by nature:


	2021		2020
Raw materials and consumables	$	264,359	$	153,173
Salaries and employee benefits	101,078		68,160
Contractors	130,865		79,355
Repairs and maintenance	60,457		37,908
Site administration	49,206		37,523
Royalties	28,618		23,312
	634,583		399,431
Change in inventories	20,221		23,860
Total operating expense	$	654,804	$	423,291

23. CARE AND MAINTENANCE EXPENSE

During the year ended December 31, 2021, the Company incurred total care and maintenance costs of $15.3 million (2020 – $65.0 million).

Included in care and maintenance costs for the year ended December 31, 2021 were $14.2 million incurred at Los Filos resulting from a delayed restart in the first quarter of 2021 from the community blockade as described below that lifted in December 2020 and the temporary suspension of operations resulting from a community blockade in July 2021.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

23. CARE AND MAINTENANCE EXPENSE (CONTINUED)

Included in care and maintenance costs for the year ended December 31, 2020 were $18.2 million in mine standby costs resulting from government mandated shutdowns due to the COVID-19 pandemic at the Company's operations in Mexico ($15.3 million) and certain of its operations in Brazil ($2.9 million). In addition, the Company temporarily suspended operations at Los Filos in September 2020 as a result of a community blockade and incurred $44.6 million in care and maintenance costs during the temporary suspension until operations resumed on December 23, 2020. The Company also incurred $2.2 million in care and maintenance costs at Santa Luz prior to approval of construction by the Company's Board of Directors on November 9, 2020.

24. GENERAL AND ADMINISTRATION EXPENSE

General and administration expense during the years ended December 31, 2021 and 2020 were comprised of the following expenses by nature:


	2021		2020
Salaries and benefits	$	19,761	$	12,497
Share-based compensation	6,082		6,751
Professional fees	15,696		12,814
Office and other expenses	9,809		7,638
Depreciation	1,242		692
Total general and administration expense	$	52,590	$	40,392

25. OTHER INCOME (EXPENSE)

Other income (expense) during the years ended December 31, 2021 and 2020 were comprised of the following:


	2021		2020
Foreign exchange gain	$	152	$	12,050
Change in fair value of gold contracts (note 15(b)(i))	16,605		(48,091)
Change in fair value of foreign exchange contracts (note 15(b(ii))	(4,410)		(14,731)
Change in fair value of warrants (note 15(a),15(b)(iii),15(b)(iv))	85,790		(29,862)
Change in fair value of contingent consideration (note 15(b)(v))	(923)		—
Change in fair value of Stream Arrangement (note 9)	(6,419)		—
Gain on bargain purchase of Premier (note 5(a))	81,432		—
Gain on sale of Pilar (note 5(c))	45,417		—
Gain on sale of partial interest in Solaris (note 5(d))	50,300		—
Gain on reclassification of investment in Solaris (note 5(d))	186,067		—
Dilution gain on investment in associate	2,067		8,033
Loss on disposal of plant and equipment	(12,414)		(1,679)
Expected credit losses(1)	(6,951)		(6,074)
Other expense	(10,151)		(6,183)
Total other income (expense)	$	426,562	$	(86,537)

(1) Related to non-trade receivables (note 12).

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

26. INCOME TAXES

Income tax expense during the years ended December 31, 2021 and 2020 differs from the amounts that would result from applying the combined Canadian federal and provincial income tax rate of 27% (2020 – 27%) to income before income taxes. These differences result from the following items:


	2021			2020
Income before income taxes	$	535,035		$	43,099
Combined Canadian federal and provincial income tax rate	27		%	27		%
Expected income tax expense	144,459			11,637
Non-taxable income and non-deductible expenses	(52,405)			24,003
Impact of tax rate differences between jurisdictions	(31,941)			—
Tax effect of temporary differences for which no tax benefit has been recognized	(39,843)			6,424
Change in fair value of derivative liabilities	(11,312)			8,063
Impact of US percentage depletion	(10,114)			(10,325)
Impact of Mexican inflation	(3,024)			(2,311)
Foreign exchange and other	(15,674)			(16,680)
Total income tax (recovery) expense	$	(19,854)		$	20,811

Comprising:
Current tax expense	$	25,163		$	35,050
Deferred tax recovery	(45,017)			(14,239)
	$	(19,854)		$	20,811

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

26. INCOME TAXES (CONTINUED)

The significant components of the Company's recognized deferred tax assets and deferred tax liabilities at December 31, 2021 and 2020 were as follows:


	2021		2020
Non-capital losses	$	62,419	$	22,421
Deductible temporary differences relating to:
Mineral properties, plant and equipment	75,259		45,109
Inventory	31,847		2,084
Reclamation and closure cost provision	16,023		15,080
Mining tax	10,717		3,924
Accrued liabilities	10,650		6,051
Investments and loans and borrowings	11,701		—
Suspended interest deduction	4,604		—
Other	7,396		8,248
Total deferred tax assets	$	230,616	$	102,917
Taxable temporary differences relating to:
Mineral properties, plant and equipment	$	(492,463)	$	(296,861)
Marketable securities	(30,227)		—
Reclamation and closure cost provision	(12,070)		(5,631)
Derivatives	(7,174)		—
Intercompany loan	(6,898)		(16,757)
Other	(1,490)		(13,528)
Total deferred tax liabilities	(550,322)		(332,777)
Net deferred tax liability	$	(319,706)	$	(229,860)

Presented as:
Deferred tax assets	$	10,576	$	—
Deferred tax liabilities	(312,198)		(229,860)
Deferred tax liabilities relating to assets held for sale (note 9)	(18,084)		—
	$	(319,706)	$	(229,860)

The movements in the Company's net deferred tax liability during the years ended December 31, 2021 and 2020 were as follows:


	2021		2020
Balance – beginning of year	$	(229,860)	$	(10,712)
Recognized in net income	45,017		14,239
Acquisition of Premier (note 5(a))	(121,931)		—
Acquisition of Leagold (note 5(e))	—		(230,458)
Recognized in OCI	(12,932)		—
Recognized in equity component of Convertible Notes	—		(2,929)
Balance – end of year	$	(319,706)	$	(229,860)

In assessing whether to recognize deferred tax assets, other than deferred tax assets arising from the initial recognition of assets and liabilities that do not affect accounting or taxable income which are not recognized, management considers whether it is probable that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income against which the deferred tax assets can be utilized.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

26. INCOME TAXES (CONTINUED)

The Company's deductible temporary differences, unused tax losses and unused tax credits at December 31, 2021 and 2020 for which deferred tax assets have not been recognized were as follows:


	2021		2020
Deductible temporary differences relating to:
Mineral properties, plant and equipment	$	430,274	$	277,097
Investments and loans and borrowings	322,272		12,021
Inventories	—		18,978
Derivatives	8,276		97,647
Reclamation obligation	41,164		54,996
Share issue and finance costs	1,176		21,471
Interest expense	—		19,350
Other	14,970		903
Non-capital losses	449,984		357,080
Capital losses	10,689		26,826
State alternative minimum tax credit	7,434		7,787
	$	1,286,239	$	894,156

At December 31, 2021, the Company had the following estimated tax operating losses available to reduce future taxable income, including both losses for which deferred tax assets are recognized and losses for which deferred tax assets are not recognized as listed in the table above. The loss carryforwards expire as follows:


	2021
Canada (expire between 2035-2041)	$	238,898
United States - California (expire between 2034-2040 or after)	170,214
Mexico (expire between 2024-2030)	142,441
Brazil (no expiry)	117,671
Other (2026 and onwards)	10,938
	$	680,162

27. NET INCOME PER SHARE

The calculations of basic and diluted EPS for the years ended December 31, 2021 and 2020 were as follows:


	2021					2020
	Weighted average shares outstanding	Net income		Net income per share		Weighted average shares outstanding	Net income		Net income per share
Basic EPS	284,932,357	$	554,889	$	1.95	212,487,729	$	22,288	$	0.10
Dilutive stock options	1,165,033	—				2,015,014	—
Dilutive RSUs and pRSUs	2,806,153	—				741,588	—
Dilutive Convertible Notes	44,458,210	9,995				—	—
Dilutive warrants	372,948	(1,358)				3,167,640	(1,076)
Diluted EPS	333,734,701	$	563,526	$	1.69	218,411,971	$	21,212	$	0.10

The outstanding instruments that were not included in the calculation of diluted EPS as they were anti-dilutive for the year ended December 31, 2021 were 1.1 million warrants, 0.8 million stock options, 0.3 million equity-settled pRSUs (2020 – 16.0 million warrants, 0.2 million stock options, and 41.0 million shares issuable for convertible notes).

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

28. SEGMENT INFORMATION

Operating results of operating segments are regularly reviewed by the Company's chief operating decision maker to make decisions about resources to be allocated to the segment and to assess performance. The Company considers each of its mine sites as a reportable operating segment. The following tables present significant information about the Company's reportable operating segments as reported to the Company's chief operating decision maker:


Year ended December 31, 2021
	Revenue		Operating expense		Depreciation and depletion		Exploration expense		Other expenses		Income (loss) from operations
Mesquite	$	249,025	$	(142,487)	$	(29,231)	$	—	$	—	$	77,307
Castle Mountain	46,040		(18,608)		(3,670)		(1,175)		—		22,587
Los Filos	257,217		(227,350)		(37,527)		(339)		(14,185)		(22,184)
Mercedes(1)	56,928		(30,288)		(24,753)		(648)		—		1,239
Aurizona	242,621		(103,999)		(37,433)		(4,980)		—		96,209
Fazenda	107,917		(52,319)		(33,021)		(3,655)		—		18,922
RDM	105,774		(69,018)		(23,901)		(849)		—		12,006
Santa Luz	—		—		—		(3,692)		—		(3,692)
Greenstone(2)	—		—		—		(204)		(79)		(283)
Corporate and other(3)	16,764		(10,735)		(7,356)		(711)		(53,600)		(55,638)
	$	1,082,286	$	(654,804)	$	(196,892)	$	(16,253)	$	(67,864)	$	146,473


Year ended December 31, 2020(4)
	Revenue		Operating expense		Depreciation and depletion		Exploration expense		Other expenses		Income (loss) from operations
Mesquite	$	245,931	$	(126,334)	$	(19,655)	$	—	$	—	$	99,942
Castle Mountain	9,116		(3,478)		(734)		(6,515)		—		(1,611)
Los Filos(5)	105,872		(80,587)		(13,264)		(216)		(59,876)		(48,071)
Aurizona	229,644		(92,398)		(41,991)		(5,109)		—		90,146
Fazenda(5)	92,404		(40,882)		(22,012)		—		—		29,510
RDM(5)	106,635		(48,582)		(20,601)		—		(937)		36,515
Santa Luz(5)	—		—		—		—		(2,213)		(2,213)
Corporate and other(3)(5)	55,786		(31,030)		(13,657)		—		(42,361)		(31,262)
	$	845,388	$	(423,291)	$	(131,914)	$	(11,840)	$	(105,387)	$	172,956

(1)The above segment information includes the results of Mercedes from the date of acquisition of Premier on April 7, 2021.

(2)The above segment information includes the Company's 50% share of the results of Greenstone from the date of acquisition of Premier on April 7, 2021 to April 15, 2021, and its 60% share of the results of Greenstone from April 16, 2021 (notes 5(a) and (b)).

(3)Corporate and other includes the results of Pilar until April 16, 2021, the date of disposition.

(4)The presentation of the segment information for the year ended December 31, 2020 has been changed to present Castle Mountain and Fazenda separately as reportable segments and include Pilar in Corporate and other to be consistent with the current year presentation. Castle Mountain, Fazenda and Pilar were previously grouped in the other operating mines segment.

(5)The above segment information includes the results of Los Filos, Fazenda, RDM, Santa Luz and Pilar from the date of acquisition of Leagold on March 10, 2020 (note 5(e)).

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

28. SEGMENT INFORMATION (CONTINUED)


	Total assets(1)				Total liabilities(1)
At December 31	2021		2020		2021		2020
Mesquite	$	332,555	$	262,758	$	(74,543)	$	(36,032)
Castle Mountain	261,631		227,157		(25,607)		(23,960)
Los Filos	1,108,533		1,066,378		(274,664)		(271,712)
Mercedes(2)	207,538		—		(85,849)		—
Aurizona	363,703		338,792		(51,546)		(49,261)
Fazenda	138,143		180,397		(41,325)		(52,261)
RDM	119,468		144,025		(20,515)		(42,146)
Santa Luz	234,490		209,215		(22,016)		(10,605)
Greenstone	498,529		—		(120,657)		—
Corporate and other(3)	702,771		244,678		(665,294)		(738,900)
	$	3,967,361	$	2,673,400	$	(1,382,016)	$	(1,224,877)

(1)The presentation of the segment assets and liabilities at December 31, 2020 has been changed to present Castle Mountain and Fazenda separately as reportable segments and include Pilar in corporate and other to be consistent with the current year presentation. Castle Mountain, Fazenda and Pilar were previously grouped in the other operating mines segment.

(2)At December 31, 2021, the assets and liabilities of Mercedes were classified as held for sale (note 9).

(3)Corporate and other includes the Company's investment in i-80 Gold (note 11) at December 31, 2021.

The following table presents the Company's non-current assets, excluding financial instruments and investments in associates, by region:


At December 31	2021		2020
United States	$	451,113	$	392,290
Mexico	941,762		919,464
Brazil	730,679		685,604
Canada	544,428		1,820
Total non-current assets, excluding financial instruments	$	2,667,982	$	1,999,178

The following table presents revenue from sales to major customers that exceeded 10% of the Company's revenue for the years ended December 31, 2021 and 2020:


	2021			2020
Customer 1	$	521,476		$	354,981
Customer 2	265,690			131,439
Customer 3	264,277			259,371
Customer 4	—			87,551
Total revenue from major customers	$	1,051,443		$	833,342
Total revenue from major customers as percentage of total revenue	97.2		%	98.3		%

29. RELATED PARTY TRANSACTIONS

The Company's related parties include its subsidiaries, associate, joint operation and key management personnel. The Company's key management personnel is comprised of executive and non-executive directors and members of executive management.

In April 2021, the Company issued $32.1 million of its common shares to its executives and directors under a private placement (note 19(b)).

In June 2020, the Company repaid in full $13.7 million in principal and accrued interest owing to the Company's Chairman under a standby loan entered into in 2018. In March 2020, Mr. Beaty participated in a private placement by the Company, acquiring $36.0 million in common shares (note 19(b)).

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

29. RELATED PARTY TRANSACTIONS (CONTINUED)

The remuneration of the Company's directors and other key management personnel during the years ended December 31, 2021 and 2020 were as follows:


	2021		2020
Salaries, directors' fees and other short-term benefits	$	4,236	$	6,763
Share-based payments	4,985		3,385
Total key management personnel compensation	$	9,221	$	10,148

At December 31, 2021, $2.0 million (2020 – $2.0 million) was owed by the Company to management for accrued salaries and bonuses and reimbursement of expenses.

30. SUPPLEMENTAL CASH FLOW INFORMATION

The non-cash changes in working capital during the years ended December 31, 2021 and 2020 were as follows:


	2021		2020
(Increase) decrease in trade and other receivables	$	(3,815)	$	157
Decrease in inventories	20,221		20,545
Decrease (increase) in prepaid expenses and other current assets	2,840		(15,351)
Increase (decrease) in accounts payable and accrued liabilities	37,410		(20,544)
Non-cash changes in working capital	$	56,656	$	(15,193)

31. FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS

(a)Financial assets and financial liabilities by category

The carrying amounts of Company's financial assets and financial liabilities by category are as follows:


At December 31, 2021	Amortized cost		FVTPL		FVOCI(3)		Total
Financial assets
Cash and cash equivalents	$	305,498	$	—	$	—	$	305,498
Marketable securities	—		1,902		238,628		240,530
Trade receivables	14,207		—		—		14,207
Derivative assets(1)	—		124,452		—		124,452
Restricted cash	20,444		—		—		20,444
Other current and non-current financial assets	14,416		—		2,294		16,710
Total financial assets	$	354,565	$	126,354	$	240,922	$	721,841

Financial liabilities
Accounts payable and accrued liabilities	$	185,716	$	—	$	—	$	185,716
Loans and borrowings	540,682		—		—		540,682
Derivative liabilities(1)	—		84,857		—		84,857
Lease liabilities(2)	45,097		—		—		45,097
Other financial liabilities	3,588		—		—		3,588
Total financial liabilities	$	775,083	$	84,857	$	—	$	859,940

(1) Includes current and non-current derivatives (note 15).

(2) Includes current and non-current lease liabilities (note 18).

(3) Includes the Company's investment in Solaris Shares (note 6) and PGI (note 12).

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

31. FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (CONTINUED)

(a)Financial assets and financial liabilities by category (continued)


At December 31, 2020	Amortized cost		FVTPL		FVOCI		Total
Financial assets
Cash and cash equivalents	$	344,926	$	—	$	—	$	344,926
Marketable securities	—		3,120		—		3,120
Trade receivables	17,212		—		—		17,212
Restricted cash(1)	3,210		—		—		3,210
Other current and non-current financial assets	12,333		—		—		12,333
Total financial assets	$	377,681	$	3,120	$	—	$	380,801

Financial liabilities
Accounts payable and accrued liabilities	$	119,641	$	—	$	—	$	119,641
Loans and borrowings	545,241		—		—		$	545,241
Derivative liabilities(2)	—		154,566		—		$	154,566
Lease liabilities(3)	18,884		—		—		$	18,884
Total financial liabilities	$	683,766	$	154,566	$	—	$	838,332

(1) Includes current and non-current restricted cash. Current restricted cash is included within prepaid expenses and other current assets.

(2) Includes current and non-current derivative liabilities (note 15).

(3) Includes current and non-current lease liabilities (note 18).

(b)Fair values of financial assets and financial liabilities

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy categorizes inputs to valuation techniques used in measuring fair value into the following three levels:

Level 1 – quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2 – inputs other than quoted market prices included in Level 1 that are observable for the asset or liability, either directly, such as prices, or indirectly (derived from prices).

Level 3 – unobservable inputs for which market data are not available.

(i)Financial assets and financial liabilities measured at fair value

The fair values of the Company's financial assets and financial liabilities that are measured at fair value in the statement of financial position and the levels in the fair value hierarchy into which the inputs to the valuation techniques used to measure the fair values are categorized are as follows:


At December 31, 2021	Level 1(a)		Level 2(b)		Level 3(c)		Total
Marketable securities	$	240,530	$	—	$	—	$	240,530
Derivative assets(1)	—		124,452		—		124,452
Other financial assets	—		—		2,294		2,294
Derivative liabilities(1)	—		(78,271)		(6,586)		(84,857)
Net financial assets (liabilities)	$	240,530	$	46,181	$	(4,292)	$	282,419

At December 31, 2020
Marketable securities	$	3,120	$	—	$	—	$	3,120
Derivative liabilities(1)	(36,455)		(118,111)		—		(154,566)
Net financial liabilities	$	(33,335)	$	(118,111)	$	—	$	(151,446)

(1) Includes current and non-current derivatives (note 15).

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

31. FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (CONTINUED)

(b)Fair values of financial assets and financial liabilities (continued)

(i)Financial assets and financial liabilities measured at fair value (continued)

There were no amounts transferred between levels of the fair value hierarchy during the years ended December 31, 2021 and 2020.

(a)The fair values of marketable securities and the Company's share purchase warrants that are traded are based on the quoted market price of the underlying securities.

(b)The fair values of derivative assets and certain of its derivative liabilities are measured using Level 2 inputs. The fair values of the Company's investments in warrants, non-traded share purchase warrants and Solaris warrant liability are determined using the Black Scholes option pricing model that uses a combination of quoted market prices and market-derived inputs such as expected volatility. The fair values of the Company's gold collar and forward contracts are based on forward metal prices, and the fair values of the Company's foreign currency contracts are based on forward foreign exchange rates.

(c)The fair value of the contingent consideration derivative liability relating to Greenstone is calculated as the present value of projected future cash flows using a market-interest rate that reflects the risk associated with the delivery of the contingent consideration. The projected cash flows are affected by assumptions related to the achievement of production milestones.

(ii)Financial assets and financial liabilities not already measured at fair value

At December 31, 2021, the fair values of the Company's financial assets and financial liabilities, excluding lease liabilities, that are not measured at fair value in the statement of financial position as compared to the carrying amounts were as follows:


		December 31, 2021				December 31, 2020
	Level	Carrying amount		Fair value		Carrying amount		Fair value
Receivables from asset sales(a)	3	$	10,321	$	10,321	$	12,197	$	12,197
Credit Facility(b)	2	279,621		287,255		289,910		300,599
Convertible Notes(b)	2	261,061		384,143		255,331		521,873

(a) The fair values of receivables from sales of the Company's non-core assets are calculated as the present value of expected future cash flows based on expected amounts and timing of future cash flows discounted using a market rate of interest for similar instruments.

(b) The fair values of the Credit Facility and Convertible Notes are calculated as the present value of future cash flows based on contractual cash flows discounted using a market rate of interest for similar instruments.

(c) At December 31, 2021 and 2020, the carrying amounts of the Company's cash and cash equivalents, restricted cash, trade and other current receivables, accounts payable and accrued liabilities and other current liabilities approximate their fair values due to the short-term nature of the instruments.

32. FINANCIAL INSTRUMENT RISKS AND RISK MANAGEMENT

The Company is exposed in varying degrees to a variety of financial instrument related risks including credit risk, liquidity risk and market risk. The Company's Board of Directors approves and oversees the Company's risk management process, which seeks to minimize the potential adverse effects of financial risks on the Company's financial results. At December 31, 2021, the financial risks to which the Company is exposed and the Company's objectives, policies and processes for managing those risks are as follows:

(a)Credit risk

Credit risk is the risk of financial loss to the Company if a counterparty to a financial instrument fails to meet its contractual obligations.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

32. FINANCIAL INSTRUMENT RISKS AND RISK MANAGEMENT (CONTINUED)

(a)Credit risk (continued)

The Company is primarily exposed to credit risk on its cash and cash equivalents, restricted cash, trade receivables, and other current and non-current receivables. The Company's maximum exposure to credit risk at December 31, 2021, represented by the carrying amounts of these financial assets, was $354.6 million (2020 – $404.5 million).

Credit risk arising from the Company's trade receivables is low with negligible expected credit losses as the Company sells its products to large global financial institutions and other companies with high credit ratings. Credit risk relating to receivables from the sale of the Company's non-core assets is mitigated by collateral held as security in the event of default.

(b)Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company's objective in managing its liquidity risk is to ensure there is sufficient capital to meet its short-term business requirements after taking into account the Company's holdings of cash and cash equivalents. The Company manages its liquidity risk through a rigorous planning, budgeting and forecasting process to help determine the funding requirements to support its current operations, development and expansion plans. The Company also manages its liquidity risk by managing its capital structure (note 33).

The Company has a $400 million Revolving Facility available for general corporate purposes, other than for repayment of amounts owing under the 2019 Notes, of which it has utilized $199.7 million at December 31, 2021.

The Company enters into contracts in the normal course of business that give rise to commitments for future payments. The following table summarizes the contractual maturities of the Company's liabilities, and operating and capital purchase commitments at December 31, 2021:


	Within 1 year		1-2 years		2-3 years		3-4 years		4–5 years		Thereafter		Total
Accounts payable and accrued liabilities	$	185,716	$	—	$	—	$	—	$	—	$	—	$	185,716
Loans and borrowings(1)(2)	48,261		47,489		376,364		147,223						619,337
Derivative liabilities	44,825		572										45,397
Lease liabilities(2)	19,362		18,742		9,010		6		6		13		47,139
Other financial liabilities(2)	—		5,000		—		—		—		—		5,000
Reclamation and closure costs(2)	3,748		6,576		8,311		10,008		8,724		145,314		182,681
Purchase commitments(2)	94,241		9,524		4,608		2,214		1,295		2		111,884
Other operating commitments(2)	30,546		31,766		33,035		17,796		18,508		48,763		180,414
Total	$	426,699	$	119,669	$	431,328	$	177,247	$	28,533	$	194,092	$	1,377,568

(1)Amount includes principal and interest payments, except accrued interest which is included in accounts payable and accrued liabilities.

(2)Amounts represent undiscounted future cash flows.

(c)Market risk

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. The Company is exposed to the following market risks: interest rate risk, currency risk and other price risk.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

32. FINANCIAL INSTRUMENT RISKS AND RISK MANAGEMENT (CONTINUED)

(c)Market risk (continued)

(i)Interest rate risk

Interest rate risk is the risk that the fair values or future cash flows of the Company's financial instruments will fluctuate because of changes in market interest rates.

The Company is exposed to interest rate cash flow risk on its Revolving Facility and Term Loan which are subject to variable interest rates based on LIBOR or another alternate benchmark rate when the current benchmark rate ceases to exist (notes 3(u)(iii) and 14(a)). A 1.0% increase or decrease in the LIBOR interest rate during the year ended December 31, 2021 would have resulted in a decrease or increase of $2.2 million, respectively, in the Company's net income during the year ended December 31, 2021.

The Company is also exposed to interest rate cash flow risk on its cash and cash equivalents and restricted cash that earn variable interest.

The Company is exposed to interest rate fair value risk on the 2019 Notes and 2020 Notes, which are subject to fixed interest rates. The Company manages its interest rate risk with a mix of fixed and variable rate debt. A change in market interest rate would impact the fair values of the 2019 Notes and 2020 Notes. However, as the Convertible Notes are measured at amortized cost, changes in market interest rates would have had no impact to the Company's net income during the year ended December 31, 2021.

(ii)Foreign currency risk

Currency risk is the risk that the fair values or future cash flows of the Company's financial instruments, in functional currency terms, will fluctuate because of changes in foreign exchange rates. Except for Greenstone, which uses the Canadian dollar as its functional currency, the functional currency of the Company and its subsidiaries is the US dollar. The Company and its subsidiaries are exposed to currency risk on transactions, investments and balances denominated in currencies other than USD, principally on BRL, MXN, and CAD expenses. During the year ended December 31, 2021, Greenstone did not have material transactions or balances denominated in any currency other than the Canadian dollar from which it would be exposed to currency risk.

The following tables summarize the Company's exposure to currency risk arising from financial assets and financial liabilities, excluding foreign exchange contracts, denominated in foreign currencies:


At December 31, 2021	BRL		MXN		CAD
Financial assets	$	19,219	$	558	$	415,234
Financial liabilities	(54,594)		(50,250)		(46,674)
	$	(35,375)	$	(49,692)	$	368,560
At December 31, 2020
Financial assets	$	73,236	$	9,889	$	13,254
Financial liabilities	(61,896)		(5,952)		(7,671)
	$	11,340	$	3,937	$	5,583

Based on the above foreign currency denominated financial assets and financial liabilities at December 31, 2021, the reasonably possible weakening in foreign currencies against the USD at such date, assuming all other variables remained constant, would have resulted in the following increase (decrease) in the Company's net income during the year ended December 31, 2021:


	2021
BRL – 20%	$	5,165
MXN – 10%	3,628
CAD – 10%	(26,905)

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

32. FINANCIAL INSTRUMENT RISKS AND RISK MANAGEMENT (CONTINUED)

(c)Market risk (continued)

(ii)Foreign currency risk (continued)

In accordance with its foreign currency exchange risk management program, the Company uses foreign exchange contracts to manage its exposure to currency risk on expenditures in BRL and MXN which are accounted for as derivative financial instruments (note 15(b)(ii)). At December 31, 2021, a 20% and 10% weakening in the BRL and MXN against the USD would have resulted in a decrease of $1.5 million in the fair value of the foreign currency derivative liabilities and increase in Company's net income during the year ended December 31, 2021. A 20% and 10% strengthening in the BRL and MXN against the USD would have resulted in an increase of $2.3 million in the fair value of the foreign currency derivative liabilities and decrease in the Company net income during the year ended December 31, 2021.

(iii)Other price risk

Other price risk is the risk that the fair values or future cash flows of the Company's financial instruments will fluctuate because of changes in market prices, other than interest rate risk or currency risk.

As part of the Leagold Acquisition (notes 5(e)), the Company assumed gold collar and forward contracts (note 15(b)(i)). In connection with the acquisition of an additional 10% interest in Greenstone (note 5(b)), the Company assumed a contingent obligation for future gold deliveries (note 15(b)(v)). These contracts are measured at FVTPL at the end of each reporting period. A 10% increase or decrease in the price of gold at December 31, 2021 would have resulted in a decrease or increase of $10.5 million in the Company's net income for the year ended December 31, 2021, respectively.

The Company holds investments in marketable securities and warrants and has issued warrants which are measured at fair value. The fair values of investments in marketable securities are based on the closing share price of the securities at the reporting date. The fair values of the investments in warrants and warrants issued are measured using the Black-Scholes option pricing model with the closing share price of the underlying securities as an input. A 10% increase or decrease in the applicable share prices would have resulted in an increase or decrease of $2.3 million in the Company's net income, respectively, and an increase or decrease of $8.7 million in the Company's OCI, respectively.

33. CAPITAL MANAGEMENT

The Company's primary objective when managing capital is to ensure it will be able to continue as a going concern and that it has sufficient ability to satisfy its capital obligations and ongoing operational expenses, as well as having sufficient liquidity to fund suitable business opportunities as they arise.

The capital of the Company consists of items included in the Company's equity and loans and borrowings, net of cash and cash equivalents. The Company's capital, as defined above, is summarized in the following table:


	December 31, 2021		December 31, 2020
Equity	$	2,585,345	$	1,448,523
Loans and borrowings	540,682		545,241
	3,126,027		1,993,764
Less: cash and cash equivalents	(305,498)		(344,926)
	$	2,820,529	$	1,648,838

The Company manages its capital structure and makes adjustments as necessary in light of economic conditions. The Company, upon approval from its Board of Directors, seeks to balance its overall capital structure through new share issues or by undertaking other activities as deemed appropriate under the specific circumstances. To maintain its capital structure, the Company may, from time to time, issue or buy back equity, draw down or repay debt, or sell assets.

Notes to Consolidated Financial Statements

For the years ended December 31, 2021 and 2020

(Tables expressed in thousands of United States dollars, except share and per share amounts)

34. CONTINGENCIES AND OTHER RISKS

At December 31, 2021, the Company had the following outstanding matters:

(a)Legal

The Company is a defendant in various lawsuits and legal actions for alleged fines, labour related and other matters in the jurisdictions in which it operates. Management regularly reviews these lawsuits and legal actions with outside counsel to assess the likelihood that the Company will ultimately incur a material cash outflow to settle a claim. To the extent management believes it is probable that a cash outflow will be incurred to settle a claim, a provision for the estimated settlement amount is recognized. At December 31, 2021, the Company recognized a provision of $11.6 million (2020 – $13.2 million) for legal matters which is included in other non-current liabilities.

(b)Tax

The Company is contesting federal income and municipal VAT assessments in Brazil. Brazilian courts often require a taxpayer to post cash or a guarantee for the disputed amount before hearing a case. It can take up to five years to complete an appeals process and receive a final verdict. At December 31, 2021, the Company recognized restricted cash of $4.6 million (2020 – $1.2 million) in relation to insurance bonds for tax assessments in the appeals process. The Company may be required to post additional security in the future, by way of cash, insurance bonds or equipment pledges, with respect to certain federal income and municipal tax assessments being contested, the amounts and timing of which are uncertain. The Company and its advisor believe the federal income and municipal tax assessments under appeal are wholly without merit and it is not probable that a cash outflow will occur. Accordingly, no provision has been recognized with respect to these matters.

(c)Environmental

A historic rain event caused widespread flooding in the Aurizona region in late March 2021 and a fresh water pond on the Aurizona site overflowed during the rain event. The tailings facility and other infrastructure at the Aurizona site remained operational. The Company received notices from the local state government of environmental infractions related to turbidity in the local water supply at Aurizona with associated fines totaling $9.2 million. In addition to the fines, a pubic civil action has been filed against the Company by the State prosecutor claiming various damages as a result of the rain event. The Company and its advisors believe the fines and public civil action are without merit and it is not probable that a cash outflow will occur. Accordingly, no amount has been recognized in relation to the fines.

(d)COVID-19

In March 2020, the COVID-19 outbreak was declared a global pandemic by the World Health Organization. The pandemic and efforts to contain it have significantly impacted the global economy, including commodity prices, and disrupted global supply chains and capital markets. The Company has implemented preventative measures at each of its sites and corporate office in collaboration with the Company's employees, contractors, host communities and governments to limit the exposure to and spread of COVID-19. The Company's COVID-19 protocols include routine testing at all it sites, travel restrictions, limiting mine site access, physical distancing and other safety precautions and remote work policies where possible.

During the second quarter of 2020, the Company temporarily suspended operations at its mine in Mexico and certain of its mines in Brazil as a result of government-mandated restrictions and the mines were placed in care and maintenance. While the Company's operations continue to experience some effects from the COVID-19 pandemic, there has been no further government-mandated shut downs and the Company has not experienced any material sales or supply chain disruptions. To date, the effects of COVID-19 on the Company have included mine standby costs incurred during the temporary suspension of operations during the second quarter of 2020 and the subsequent ramp up of operations, incremental costs related to increased health and safety protocols and other COVID-19 related protocols and workforce participation. Additionally, in 2021, operations have experienced higher inflation on material inputs due to COVID-19 driven market conditions.

As the COVID-19 pandemic continues to evolve into 2022, the magnitude of its effects on the economy, and on the Company's operating plan, financial and operational performance is uncertain. It is possible that the COVID-19 pandemic could have a material adverse effect on the Company's future results and cash flows and result in write-downs of its non-current assets.

The above matters could have an adverse impact on the Company's financial performance, cash flows and results of operations if they are not resolved favorably.

Management’s Discussion and Analysis

For the three months and year ended December 31, 2021

(Expressed in United States Dollars, unless otherwise stated)


Management’s Discussion and Analysis For the three months and year ended December 31, 2021

This Management’s Discussion and Analysis (“MD&A”) of the financial position and results of operations for Equinox Gold Corp. (the “Company” or “Equinox Gold”) should be read in conjunction with the audited consolidated financial statements of the Company as at and for the year ended December 31, 2021 and the related notes thereto, which have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board. For further information on the Company, reference should be made to its public filings on SEDAR at www.sedar.com and on EDGAR at www.sec.gov/edgar.

This MD&A is prepared by management and approved by the Board of Directors as of March 23, 2022. This discussion covers the three months (“Q4 2021” or the “Quarter”) and the year ended December 31, 2021 and the subsequent period up to the date of issuance of this MD&A. All dollar amounts are in United States (“US”) dollars, except where otherwise noted.

This MD&A contains forward-looking statements. Readers are cautioned as to the risks and uncertainties related to the forward-looking statements, the risks and uncertainties associated with investing in the Company’s securities, and the risks and uncertainties associated with technical and scientific information under National Instrument 43-101 (“NI 43-101”) concerning the Company’s material properties, including information about mineral reserves and resources.

Throughout this MD&A, cash costs, cash costs per ounce (“oz”) sold, all-in sustaining costs (“AISC”), AISC per oz sold, AISC contribution margin, adjusted net income, adjusted earnings per share (“EPS”), mine free cash flow, adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization), net debt, and sustaining and non-sustaining capital expenditures are non-IFRS financial measures with no standard meaning under IFRS. Non-IFRS measures are further discussed in the Non-IFRS Measures section of this MD&A.

Throughout this MD&A, the operational and financial results of the assets acquired in the acquisition of Premier Gold Mines Limited (“Premier” and the “Premier Acquisition”) are included from April 7, 2021 onward. The operational and financial results of the assets acquired in the acquisition of Leagold Mining Corporation (“Leagold” and the “Leagold Acquisition”) are included from March 10, 2020 onward.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


CONTENTS
Business Overview			4
2021 Highlights			4
Highlights for the Three Months Ended December 31, 2021			5
Post Quarter End Highlights			7
Consolidated Operational and Financial Highlights			8
2021 Guidance Comparison			8
2022 Guidance and Outlook			10
Operations			11
Development Projects			25
Health, Safety and Environment			27
Community Development & ESG Reporting			28
Corporate			29
Financial Results			31
Liquidity and Capital Resources			35
Outstanding Share Data			36
Commitments and Contingencies			36
Related Party Transactions			38
Non-IFRS Measures			39
Risks and Uncertainties			44
Accounting Matters			60
Internal Controls Over Financial Reporting and Disclosure Controls and Procedures			60
Cautionary Notes and Forward-looking Statements			62
Technical Information			64


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


BUSINESS OVERVIEW

Operations description

Equinox Gold is a growth-focused mining company delivering on its strategy of building the premier Americas gold producer. In its first four years the Company has grown from a single-asset developer to a multi-asset gold producer with seven operating gold mines at the date of this MD&A, a multi-million-ounce gold reserve base and a strong growth profile from a pipeline of development and expansion projects. Equinox Gold operates entirely in the Americas. At the date of this MD&A, the Company had two properties in the United States, two properties in Mexico, four in Brazil and one in Canada. The Company’s operating gold mines are the Mesquite Mine (“Mesquite”) and Castle Mountain Mine (“Castle Mountain”) in the United States, the Los Filos Mine Complex (“Los Filos”) and Mercedes Mine (“Mercedes”) in Mexico, and the Aurizona Mine (“Aurizona”), Fazenda Mine (“Fazenda”) and RDM Mine (“RDM”) in Brazil. Commissioning is underway at the Company’s Santa Luz Project (“Santa Luz”) in Brazil. The Company also has a 60% interest in the Greenstone Project (“Greenstone”) in Canada, which is in construction. In Q4 2021, the Company entered into an agreement to sell Mercedes, with the expectation of completing the sale around the end of the first quarter of 2022.

Equinox Gold was created with the strategic vision of building a company that will responsibly and safely produce more than one million ounce of gold annually, bring long-term social and economic benefits to its host communities, create a safe and rewarding workplace for its employees and contractors, and provide above-average investment returns to its shareholders. To achieve its growth objectives, Equinox Gold intends to expand production from its current asset base through exploration and development and will also consider opportunities to acquire other companies, producing mines and development projects that fit the Company’s portfolio and strategy.

Equinox Gold’s common shares trade under the symbol “EQX” on the Toronto Stock Exchange (“TSX”) in Canada and on the NYSE American Stock Exchange (“NYSE-A”) in the United States.


2021 HIGHLIGHTS

Operational

•Realized 26% production growth compared to 2020

•Achieved 2021 guidance with total production of 602,110 ounces of gold

•Sold 602,668 ounces of gold at an average realized gold price of $1,791 per oz

•Total cash costs of $1,087 per oz and AISC of $1,350 per oz(1)

•Produced the Company’s millionth ounce of gold and realized over $1 billion in revenue

•Achieved a total recordable injury frequency rate(2) of 3.05, 17% better than 2020, with 13 lost-time injuries

•Achieved a significant environmental incident frequency rate(2) of 0.68, 60% better than 2020

•Continued proactive COVID-19 health and safety protocols with no production days lost due to COVID-19; supported community health with donations of supplies and support for education, medical staffing and vaccination programs

Earnings

•Earnings from mine operations of $230.6 million

•Net income of $554.9 million or $1.95 per share

◦Includes $85.8 million unrealized gain on change in fair value of warrants, $58.1 million unrealized gain on change in fair value of gold contracts, $186.1 million gain on reclassification of investment in Solaris Resources Inc. (“Solaris”) from cost to fair value accounting, $50.3 million gain on sale of partial interest in Solaris, $45.4 million gain on sale of Pilar Mine and $81.4 million gain on acquisition of Premier Gold

•Adjusted net income of $70.3 million(1) or $0.25 per share(1), after adjusting for certain non-cash expense items(3)

Financial

•Cash flow from operations before changes in non-cash working capital of $264.1 million ($320.8 million after changes in non-cash working capital)

•Adjusted EBITDA of $303.1 million(1)(3)

•Expenditures of $144.7 million in sustaining capital and $238.7 million in non-sustaining capital(1)

•Cash and cash equivalents (unrestricted) of $305.5 million at December 31, 2021

•Net debt(1) of $235.2 million at December 31, 2021 (including $139.7 million of in-the-money convertible notes)


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


2021 HIGHLIGHTS (CONTINUED)

Corporate

•Completed acquisition of Premier, increasing diversification and scale with a 50% interest in the low-cost, long-life Greenstone gold project in Canada and a 100% interest in the operating gold-silver Mercedes Mine in Mexico

•Increased Greenstone ownership interest to 60%

•Sold ten million shares in Solaris Resources Inc. (“Solaris”), along with warrants wherein the warrant holders may purchase up to five million additional shares from Equinox Gold at a strike price of C$10.00 per share. The shares and warrants were sold for total proceeds of $66.7 million. The warrants expire in April 2022. Equinox Gold could receive additional proceeds of approximately $39 million on exercise of the warrants.

•Sold the Pilar Mine (“Pilar”) for $38.0 million, a 1% net smelter return royalty and 11.6 million shares of Pilar Gold Inc. (“Pilar Gold”)

•Invested $40.9 million in i-80 Gold Corp. (“i-80 Gold”) to maintain an approximate 25% interest on a fully diluted basis

•Announced agreement to sell the Mercedes Mine for $100 million, a 2% net smelter return and 24.7 million shares of Bear Creek Mining Corporation (“Bear Creek”)(4)

Construction, development and exploration

•Commenced Greenstone construction in Q4 2021 with first gold pour targeted for the first half of 2024 (“H1 2024”)

•Advanced Santa Luz construction with first gold pour targeted for late Q1 2022

•Increased Aurizona Mineral Reserves by 73% and completed a positive pre-feasibility study for an expansion that would extend the mine life to 11 years and increase annual production by concurrently mining new underground and satellite open-pit deposits with the existing open-pit mine

•Increased Castle Mountain Mineral Reserves by 17% and completed a positive feasibility study for a Phase 2 expansion that would extend the Castle Mountain mine life to 21 years and increase gold production to more than 200,000 ounces per year

•Commenced mining the new Guadalupe open-pit deposit and Bermejal underground deposit at Los Filos

•Drilled 219,000 metres across the portfolio with a focus on Mineral Reserve growth and mine life extension

•Added 3.3 million ounces of Proven and Probable Mineral Reserves through the Premier Acquisition

Responsible mining

•Published inaugural Environmental, Social and Governance (ESG) Report

•Published first Tailings Management Report

•Submitted data to the Carbon Disclosure Project

•Started implementing Towards Sustainable Mining Protocols and Responsible Gold Mining Principles at all mine sites

•Established a Social Responsibility & Human Rights Policy, conducted human rights assessments at two mine sites

•Set and achieved short-term energy and greenhouse gas emission targets for 2021, submitted data to the Carbon Disclosure Project, and commenced reporting using the Task Force on Climate-related Financial Disclosures framework

•Developed and implemented ESG Management Standards, formed an ESG Committee and an Enterprise Risk Management Committee


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


HIGHLIGHTS FOR THE THREE MONTHS ENDED DECEMBER 31, 2021

Operational

•Total recordable injury frequency rate of 2.92 with 3 lost-time injuries

•Produced 210,432 ounces of gold during the quarter; sold 212,255 ounces of gold at an average realized gold price of $1,792 per oz

•Total cash costs of $1,040 per oz and AISC of $1,266 per oz

Earnings

•Earnings from mine operations of $99.4 million

•Net income of $109.0 million or $0.37 per share

◦Includes $27.5 million unrealized gain on change in fair value of share purchase warrants and $8.0 million loss on disposal of plant and equipment.

•Adjusted net income of $72.2 million or $0.24 per share, after adjusting for non-cash expense items noted above(5)

Financial

•Cash flow from operations before changes in non-cash working capital of $122.2 million ($155.4 million after changes in non-cash working capital)

•Adjusted EBITDA of $130.0 million(5)

•Expenditures of $42.4 million in sustaining capital and $84.6 million in non-sustaining capital

Construction, development and exploration

•Commenced full-scale construction at Greenstone with a construction budget on a 100% basis (of which Equinox Gold will fund 60%) of C$1.53 billion ($1.23 billion at a rate of USD:CAD 1.25), including a $177 million contingency

◦Initial capital estimate updated in October 2021 to reflect firm supplier quotes following detailed engineering, a review and update of capital costs, and an increased contingency including a provision for future inflation and potential COVID-19 impacts

◦Initial cash spend could be reduced by approximately $100 million through lease financing for mobile equipment and offset economically by up to $70 million of pre-commercial production revenues (at $1,750 per oz gold price)


(1)Cash costs per oz sold, AISC per oz sold, adjusted net income, adjusted EBITDA, adjusted EPS, sustaining capital, non-sustaining capital and net debt are non-IFRS measures. See Non-IFRS Measures and Cautionary Notes.
(2)Total recordable injury frequency rate and significant environmental incident frequency rate are both reported per million hours worked. Total recordable injury frequency rate is the total number of injuries excluding those requiring simple first aid treatment.
(3)Primary adjustments for the year ended December 31, 2021 were $85.8 million unrealized gain on change in fair value of warrants, $58.1 million unrealized gain on change in fair value of gold contracts, $186.1 million gain on reclassification of investment in Solaris from cost to fair value accounting, $50.3 million gain on sale of partial interest in Solaris, $45.4 million gain on sale of Pilar and $81.4 million gain on acquisition of Premier Gold.
(4)The sale is expected to close around the end of Q1 2022, subject to completion of customary closing conditions and regulatory approvals.
(5)Primary adjustments for the three months ended December 31, 2021 were $27.5 million unrealized gain on change in fair value of share purchase warrants and $8.0 million loss on disposal of plant and equipment.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


POST QUARTER END HIGHLIGHTS

•Provided 2022 production and cost guidance of 625,000 to 710,000 ounces of gold at cash costs of $1,080 to $1,140 per oz and AISC of $1,330 to $1,415 per oz

•Provided 2022 capital expenditure guidance of $682 million

◦$195 million of sustaining capital

◦$487 million of non-sustaining capital, including $27 million to complete Santa Luz construction and $326 million to advance Greenstone construction

◦$36 million of exploration expenditures, including sustaining ($6 million) and non-sustaining ($30 million) capital expenditure guidance

•Commenced commissioning of the Santa Luz gold plant, including leach circuit, SAG mill, ball mill and secondary grinding; construction more than 95% complete and on track for first gold pour by late Q1 2022

•Greenstone construction progressing well

◦Engineering 85% complete

◦Tailings management facility ahead of schedule

◦Highway relocation underway

◦Site civil works and concrete foundation work underway

•New Brazil Federal legislation announced February 16, 2022 changed minimum freeboard(1) guidelines for all tailings storage facilities (“TSFs”), effective immediately

◦As the result of heavy rains that began in November, the RDM TSF freeboard was currently outside the new guidelines, requiring a temporary suspension of plant operations for three weeks until the water level was reduced, at which point plant operations resumed in mid-March

◦Mining and stockpiling of ore continued during the suspension of plant operations; the Company does not anticipate a material impact on corporate production for the year


(1)Freeboard is the height from the crest of the TSF embankment to the surface of tailings and water in the FSF.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


CONSOLIDATED OPERATIONAL AND FINANCIAL HIGHLIGHTS

		Three months ended			Year ended
Operating data	Unit	December 31, 2021	September 30, 2021	December 31, 2020	December 31, 2021(1)	December 31, 2020(2)
Gold produced	oz	210,432	139,758	136,352	602,110	477,186
Gold sold	oz	212,255	137,144	136,418	602,668	473,309
Average realized gold price	$/oz	1,792	1,780	1,871	1,791	1,783
Cash costs per oz sold(4)	$/oz	1,040	1,109	844	1,087	847
AISC per oz sold(3)(4)	$/oz	1,266	1,327	1,086	1,350	1,025
Financial data
Revenue	M$	381.2	245.1	255.5	1,082.3	845.4
Earnings from mine operations	M$	99.4	45.7	97.7	230.6	290.2
Net income (loss)	M$	109.0	(8.1)	91.2	554.9	22.3
Earnings (loss) per share	$/share	0.37	(0.03)	0.38	1.95	0.10
Adjusted EBITDA(4)	M$	130.0	67.3	85.3	303.1	282.3
Adjusted net income(4)	M$	72.2	9.2	38.9	70.3	88.4
Adjusted EPS(4)	$/share	0.24	0.03	0.16	0.25	0.42
Balance sheet and cash flow data
Cash and cash equivalents (unrestricted)	M$	305.5	300.3	344.9	305.5	344.9
Net debt(4)	M$	235.2	244.8	200.3	235.2	200.3
Operating cash flow before changes in non-cash working capital	M$	122.2	48.3	94.0	264.1	271.0

(1)Operational and financial results of the assets acquired as part of the Premier Acquisition are included from April 7, 2021, onward.

(2)Operational and financial results of the assets acquired as part of the Leagold Acquisition are included from March 10, 2020, onward.

(3)Consolidated AISC per oz sold excludes corporate general and administration expenses.

(4)Cash costs per oz sold, AISC per oz sold, adjusted EBITDA, adjusted net income, adjusted EPS and net debt are non-IFRS measures. See Non-IFRS Measures and Cautionary Notes.

During Q4 2021, the Company recognized revenue of $381.2 million on sales of 212,255 ounces of gold, compared to revenue for the three months ended September 30, 2021 (“Q3 2021”) of $245.1 million on sales of 137,144 ounces of gold. The increase in ounces sold from Q3 2021 to Q4 2021 is mainly due to increased production at Mesquite, as the highest grade portion of the Brownie pit was reached in late Q3 2021, and increased production at Los Filos, which had a full quarter of uninterrupted production and yielded more ounces from both the open pit and underground operations.

In Q4 2021, earnings from mine operations were $99.4 million, an increase compared to $45.7 million in Q3 2021 driven by higher production at Mesquite and Los Filos. Net income in Q4 2021 was $109.0 million compared to a net loss of $8.1 million in Q3 2021, driven by the increase in earnings from mine operations and a larger increase in the fair value of share purchase warrants compared to Q3 2021.

Adjusted EBITDA for Q4 2021 of $130.0 million increased from $67.3 million in Q3 2021 driven by higher production in Q4 2021. The fourth quarter was the largest production quarter of 2021, representing 35% of the year’s total gold production. Adjusted net income was $72.2 million for Q4 2021 compared to adjusted net income of $9.2 million in Q3 2021.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


2021 GUIDANCE COMPARISON

On August 4, 2021, the Company updated its 2021 production and cost guidance to reflect solid performance at the Brazil sites and the disruptions during June and July to mining and development activities at Los Filos. With total production of 602,110 ounces of gold, the Company achieved its 2021 production guidance. Cash costs were slightly higher compared to guidance and AISC was near the mid-point of guidance, with cash costs of $1,087 per oz and AISC of $1,350 per oz compared to guidance of $1,025 to $1,075 per oz for cash costs and AISC of $1,300 to $1,375 per oz. Actuals achieved at each mine are outlined below.


	2021 Actuals			2021 Guidance
	Production (oz)	Cash Costs ($/oz) (1)	AISC ($/oz) (1)	Production (oz)	Cash Costs ($/oz) (1)	AISC ($/oz) (1)
USA
Mesquite	137,467	$974	$1,327	130,000 - 140,000	$975 - $1,025	$1,375 - $1,425
Castle Mountain	25,270	$883	$1,429	20,000 - 30,000	$800 - $850	$1,590 - $1,640
Mexico
Los Filos	144,096	$1,575	$1,753	120,000 - 140,000	$1,590 - $1,640	$1,790 - $1,850
Mercedes	31,782	$966	$1,357	30,000 - 35,000	$750 - $800	$1,150 - $1,200
Brazil
Aurizona	134,961	$784	$991	130,000 - 140,000	$750 - $800	$1,025 - $1,075
Fazenda	60,401	$875	$1,159	60,000 - 65,000	$850 - $900	$1,100 - $1,150
RDM	58,829	$1,222	$1,410	60,000 - 65,000	$1,000 - $1,050	$1,175 - $1,225
Pilar	9,304	$1,120	$1,294	9,304	$1,120	$1,294
Total	602,110	$1,087	$1,350	560,000 - 625,000	$1,025 - $1,075	$1,300 - $1,375

(1)Cash costs per oz sold and AISC per oz sold are non-IFRS measures. See Non-IFRS Measures and Cautionary Notes.

Capital expenditures were lower than 2021 guidance as outlined below:


	2021 Actuals		2021 Guidance
$ amounts in millions	Sustaining(1)	Non-sustaining(1)	Sustaining(1)	Non-sustaining(1)
USA
Mesquite(3)	$46	$8	$49	$9
Castle Mountain(2)	14	7	18	10
Mexico
Los Filos	22	60	35	83
Mercedes	11	1	17	2
Brazil
Aurizona(2)	27	5	37	4
Fazenda(2)	15	2	16	3
RDM(2)(3)	10	19	13	25
Santa Luz	—	71	—	75
Pilar	1	—	1	—
Canada
Greenstone(4)	—	66	—	40
Total	$146	$239	$186	$251

(1)Sustaining capital and non-sustaining capital are non-IFRS measures. See Non-IFRS Measures and Cautionary Notes.

(2)For the year ended December 31, 2021, non-sustaining capital for Aurizona, Fazenda, RDM and Castle Mountain excludes $4.1 million, $3.7 million, $0.8 million and $1.2 million, respectively, of exploration costs expensed.

(3)Non-sustaining capital for Mesquite for the year ended December 31, 2021 excludes $10.9 million for lease payments for haul trucks, which are considered a non-sustaining capital addition. Non-sustaining capital for RDM for the year ended December 31, 2021 excludes $1.8 million for lease payments for mining equipment used in non-sustaining capitalized stripping activities.

(4)Non-sustaining capital expenditures at Greenstone reflects the Company’s 60% ownership of the project.

Los Filos incurred lower than guidance sustaining and non-sustaining capital expenditures mainly due to operational interruptions, but also due to slower progress on Bermejal underground development. Greenstone non-sustaining capital expenditures were higher than guidance as construction was announced in Q4 2021. Aurizona sustaining capital expenditures were lower than guidance principally due to deferred tailings storage facility (“TSF”) work, capitalized stripping and land acquisitions.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


2022 GUIDANCE AND OUTLOOK

For 2022, the Company expects to achieve its fourth consecutive year of production growth with guidance of 625,000 to 710,000 ounces of gold, which is an increase of 11% compared to 2021 production (using the mid-point of 2022 guidance). Cash costs for 2022 are estimated at $1,080 to $1,140 per oz, with AISC of $1,330 to $1,415 per oz. Production and cost guidance excludes Mercedes as the previously announced sale to Bear Creek is expected to close around the end of Q1 2022, although ounces produced and capital spent prior to closing will be attributable to Equinox Gold.

Production is expected to increase quarter over quarter, with 60% of gold production and more than 85% of operating cash flow anticipated in the second half of the year. As production increases, AISC is expected to decrease. Cash costs and AISC are expected to be approximately $1,210 and $1,540 per oz in H1 2022 and $1,025 and $1,295 per oz in H2 2022, respectively. The weighting of production and cash flow into the second half of the year is primarily due to Santa Luz transitioning from construction and commissioning to operations starting in Q2 2022.

Cash costs for 2022 reflect inflationary pressures across all operations, with approximately 15% cost escalation for fuel and other major consumables. AISC for 2022 includes $195 million of sustaining capital investment focused primarily on stripping campaigns at Mesquite, Aurizona and Santa Luz to open up new ore sources, and both open-pit stripping and underground development work at Los Filos that was in part delayed during 2021. The Company is also completing TSF expansions or lifts at Aurizona, RDM and Santa Luz and completing a leach pad expansion at Castle Mountain. Sustaining capital guidance includes $6 million for exploration, which is almost all capitalized.

The Company is undertaking several growth projects during 2022 including completing construction and commissioning of Santa Luz, advancing construction at Greenstone, and conducting exploration focused on mine life extension at Mesquite, Aurizona, Fazenda, Santa Luz and RDM. The Company’s primary development focus for 2022 is construction at Greenstone, with Equinox Gold’s 60% share of construction capital forecast at $326 million. Non-sustaining capital expenditures also include underground development at Los Filos in part carried over from 2021, a pit expansion at RDM and permitting for the Castle Mountain expansion, with total non-sustaining capital for 2022 forecast at $487 million. Non-sustaining capital guidance includes $30 million for exploration, of which approximately $19 million is expensed with the rest capitalized.


	Production (oz)	Cash Costs ($/oz)(1)	AISC ($/oz)(1)(2)	Sustaining Capital (M$)(1)(3)	Non-sustaining Capital (M$)(1)(4)
USA
Mesquite	120,000 - 130,000	$1,050 - $1,100	$1,450 - $1,500	$52 M	$20 M
Castle Mountain	25,000 - 35,000	$1,150 - $1,200	$1,475 - $1,525	$11 M	$9 M
Mexico(5)
Los Filos	160,000 - 180,000	$1,400 - $1,475	$1,625 - $1,700	$38 M	$62 M
Brazil
Aurizona	120,000 - 130,000	$800 - $850	$1,175 - $1,225	$50 M	$8 M
Fazenda	60,000 - 65,000	$975 - $1,025	$1,200 - $1,250	$14 M	$11 M
RDM	70,000 - 80,000	$1,200 - $1,250	$1,350 - $1,400	$11 M	$18 M
Santa Luz	70,000 - 90,000	$825 - $925	$975 - $1,050	$19 M	$32 M
Canada
Greenstone	—	—	—	—	$326 M
Total(6)	625,000 - 710,000	$1,080 - $1,140	$1,330 - $1,415	$195 M	$487 M

(1)Cash costs per oz sold, AISC per oz sold, sustaining capital and non-sustaining capital are non-IFRS measures. See Non-IFRS Measures and Cautionary Notes.

(2)Exchange rates used to forecast 2022 AISC include a rate of BRL 5:00 to USD 1 and MXN 19.0 to USD 1.

(3)Sustaining capital includes asset retirement obligation, amortization, accretion and sustaining exploration expenditures.

(4)Non-sustaining capital includes non-sustaining exploration expenditures.

(5)Does not include Mercedes, which is expected to be sold around the end of Q1 2022. Production and costs for Mercedes prior to the sale will be attributable to Equinox Gold.

(6)Group total is the sum or average of the individual mine-level amounts. Numbers may not sum due to rounding.

The Company may revise guidance during the year to reflect changes to expected results.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


OPERATIONS

Mesquite Gold Mine, California, USA

Mesquite is an open-pit, run-of-mine (“ROM”) heap leach gold mine located in Imperial County, California, approximately 200 miles south of Castle Mountain. Mesquite has been in production since 1985 and was acquired by Equinox Gold in Q4 2018.

Operating and financial results for the three months and year ended December 31, 2021


		Three months ended			Year ended
Operating data	Unit	December 31, 2021	September 30, 2021	December 31, 2020	December 31, 2021	December 31, 2020
Ore mined and stacked on leach pad	kt	3,175	3,835	3,498	9,740	17,351
Waste mined	kt	11,679	10,807	8,487	49,863	30,782
Open pit strip ratio	w:o	3.68	2.82	2.43	5.12	1.77
Average gold grade stacked to leach pad	g/t	0.44	0.45	0.72	0.42	0.48
Gold produced	oz	66,870	23,264	33,717	137,467	141,270
Gold sold	oz	68,377	22,333	33,032	138,289	139,872
Financial data
Revenue	M$	122.8	40.1	61.5	249.0	245.9
Cash costs(1)	M$	65.7	22.1	29.5	134.7	125.8
Sustaining capital(1)	M$	3.2	8.7	10.5	46.3	24.1
Reclamation expenses	M$	1.2	0.6	0.4	2.6	2.8
Total AISC(1)	M$	70.1	31.4	40.4	183.6	152.7
AISC contribution margin(1)	M$	52.8	8.7	21.0	65.5	93.3
Non-sustaining expenditures(1)	M$	6.2	5.1	0.6	19.4	9.2
Mine free cash flow(1)	M$	46.6	3.6	20.4	46.1	84.1
Unit analysis
Realized gold price per oz sold	$/oz	1,795	1,793	1,861	1,801	1,758
Cash costs per oz sold(1)	$/oz	960	988	894	974	899
AISC per oz sold(1)	$/oz	1,023	1,402	1,225	1,327	1,091
Mining cost per tonne mined	$/t	1.53	1.53	1.57	1.47	1.42
Processing cost per tonne processed	$/t	3.75	2.86	3.36	4.32	2.81
G&A cost per tonne processed	$/t	1.43	0.96	1.19	1.61	0.85

(1)Cash costs, sustaining capital, non-sustaining expenditures, AISC, AISC contribution margin, mine free cash flow, cash costs per oz sold, and AISC per oz sold are non-IFRS measures. See Non-IFRS Measures and Cautionary Notes.

Q4 and 2021 Analysis

Production

During Q4 2021, Mesquite produced 66,870 ounces of gold (Q3 2021 - 23,264 ounces) at an AISC of $1,023 per oz (Q3 2021 - $1,402 per oz). The Company sold 68,377 ounces (Q3 2021 - 22,333 ounces) at an average realized gold price of $1,795 per oz (Q3 2021 - $1,793 per oz), recognizing revenue of $122.8 million (Q3 2021 - $40.1 million) for the Quarter.

During Q4 2021, the Company completed phase one of the Brownie pit. Ounces poured during the Quarter were almost as much as produced in the prior three quarters combined, as ounces placed late in Q3 2021 and in Q4 2021 went to a recently constructed leach pad cell, resulting in prompt recoveries. Processing costs increased in the Quarter as cyanide consumption increased. G&A cost per tonne was higher in part due to lower tonnes processed in Q4 2021. AISC decreased in Q4 2021 due to an increase in ounces sold compared to the previous Quarter.

Mesquite achieved 2021 production guidance, with total production of 137,467 ounces compared to production guidance of 130,000 to 140,000 ounces of gold. The increase in ounces sold compared to guidance was the driver for Mesquite’s costs coming in below guidance, with cash costs of $974 per oz compared to guidance of $975 to $1,025 per oz and AISC of $1,327 per oz compared to guidance of $1,375 to $1,425 per oz.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021

Exploration and development

The Company spent $3.2 million and $8.5 million on exploration during the Quarter and year-to-date, respectively. Following up on positive results from H1 2021, exploration during Q4 2021 at the Brownie deposit included 3,760 m of reverse circulation (“RC”) drilling targeting the deeper extensions of the in-situ gold mineralization discovered in 2020. Drilling at Brownie totalled 1,680 m of core and 7,625 m of RC for the year. At the Rainbow deposit, in-fill and step-out drilling during the Quarter included 8,090 m of RC, bringing the totals to 2,976 m of core and 17,710 m of RC drilling for the year. A total of 1,720 m of core drilling completed an in-fill drill program targeting high grade structures in the VE2 deposit, bringing the total for the year to 3,099 m. An additional 778 m of RC was drilled in the Midway dump to test for additional mineralized material, bringing the total for the year to 17,423 m. Mesquite drilling for the year totalled 42,758 m of RC and 7,755 m of core across all targets. Mesquite is one of the Company’s exploration priorities, with a focus on mine life extension.

During the Quarter, the Company spent $3.2 million of sustaining capital related primarily to leach pad expansion and additional process equipment. Non-sustaining expenditures during the Quarter were $3.2 million for exploration drilling of historical dumps and other targets, which are expected to add to future production, and $3.0 million in lease payments for the new fleet of haul trucks.

During 2021, the Company spent $46.3 million of sustaining capital related primarily to capitalized stripping and leach pad expansion. Non-sustaining expenditures during the year were $8.5 million for exploration drilling and $10.9 million relating to lease payments for the new fleet of haul trucks.

Outlook

Mesquite production for 2022 is estimated at 120,000 to 130,000 ounces of gold, with approximately 60% of production expected in the second half of the year. Cash costs are estimated at $1,050 to $1,100 per oz and AISC at $1,450 to $1,500 per oz. The increase in AISC compared to 2021 reflects lower gold production as well as costs associated with stripping programs.

Ore from the Brownie pit is expected to be the primary source of production during 2022. Completion of the Brownie strip campaign provided full access to oxide ore at the bottom of the Phase 1 Brownie pit, and stripping of the Brownie Phase 2 pit commenced in Q4 2021. Forecast AISC at Mesquite in 2022 includes estimated sustaining capital of $52 million related primarily to a $44 million stripping program commencing in Q1 2022 to open up a new phase of the VE pit, which is expected to be the primary source of ore in Q4 2022 and into 2023. Non-sustaining growth capital of $20 million includes $5 million for exploration with the objective of converting resources to reserves in the Brownie, VE and Rainbow pits. The Company is also permitting and planning the construction of extensions to the leach pad and expects to make $12 million in lease payments for the truck fleet.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021

Castle Mountain Gold Mine, California, USA

Castle Mountain is an open-pit heap leach gold mine located in San Bernardino County, California, approximately 200 miles north of Mesquite. Under a previous owner, Castle Mountain produced more than 1.3 million ounces of gold from 1992 to 2004, when production ceased due to low gold prices. Equinox Gold acquired Castle Mountain in December 2017 and commenced Phase 1 operations in Q4 2020. In 2021 Equinox Gold completed a feasibility study for a proposed Phase 2 expansion that is expected to increase average production to more than 200,000 ounces of gold annually. The Company is preparing to update existing permits to accommodate the Phase 2 expansion, as described in Development Projects.

Operating and financial results for the three months and year ended December 31, 2021


		Three months ended			Year ended
Operating data	Unit	December 31, 2021	September 30, 2021	December 31, 2020(1)	December 31, 2021	December 31, 2020(1)
Ore mined and stacked to leach pad	kt	987	1,331	1,197	4,710	1,197
Waste mined	kt	408	143	130	1,149	130
Open pit strip ratio	w:o	0.41	0.11	0.11	0.24	0.11
Average gold grade stacked to leach pad	g/t	0.28	0.30	0.33	0.36	0.33
Gold produced	oz	8,357	7,873	5,338	25,270	5,338
Gold sold	oz	8,947	7,378	4,862	25,671	4,862
Financial data
Revenue	M$	16.1	13.1	9.1	46.0	9.1
Cash costs(2)	M$	8.2	6.1	4.5	22.7	4.5
Sustaining capital(2)	M$	8.6	1.8	—	13.9	—
Reclamation expenses	M$	0.0	0.0	0.0	0.1	0.0
Total AISC(2)	M$	16.8	7.9	4.5	36.7	4.5
AISC contribution margin(2)	M$	(0.8)	5.2	4.6	9.3	4.6
Non-sustaining expenditures(2)	M$	2.0	0.8	7.4	7.8	51.9
Mine free cash flow(2)	M$	(2.8)	4.4	(2.8)	1.5	(47.3)
Unit analysis
Realized gold price per oz sold	$/oz	1,795	1,778	1,875	1,793	1,875
Cash costs per oz sold(2)	$/oz	918	822	921	883	921
AISC per oz sold(2)	$/oz	1,881	1,067	921	1,429	921
Mining cost per tonne mined	$/t	3.31	3.24	3.30	3.15	4.12
Processing cost per tonne processed	$/t	2.89	1.99	1.79	1.95	2.14
G&A cost per tonne processed	$/t	2.28	1.35	1.87	1.39	2.28

(1)Castle Mountain commenced commercial production on November 21, 2020.

(2)Cash costs, sustaining capital, non-sustaining expenditures, AISC, AISC contribution margin, mine free cash flow, cash costs per oz sold, and AISC per oz sold are non-IFRS measures. See Non-IFRS Measures and Cautionary Notes.

Q4 and 2021 Analysis

Production

During Q4 2021, Castle Mountain produced 8,357 ounces of gold (Q3 2021 - 7,873 ounces) at an AISC of $1,881 per oz (Q3 2021 - $1,067 per oz). The Company sold 8,947 ounces (Q3 2021 - 7,378 ounces) of gold at an average realized price of $1,795 per oz (Q3 2021 - $1,778 per oz), recognizing revenue of $16.1 million (Q3 2021 - $13.1 million) for the Quarter.

The increase in production in Q4 2021 reflects continued efforts to optimize leach pad and plant operations, with production continuing to show benefits from modified stacking and irrigation practices. Processing unit costs increased due to changing ore characteristics, which required more lime and cyanide for leaching. AISC increased in Q4 2021 compared to Q3 2021 as the leach pad expansion commenced, with $8.0 million spent in the Quarter.

Castle Mountain achieved 2021 production guidance with annual production of 25,270 ounces of gold compared to guidance of 20,000 to 30,000 ounces of gold, with cash costs of $883 per oz and AISC of $1,429 per oz compared to guidance of $800 to $850 per oz for cash costs and $1,590 to $1,640 per oz for AISC.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021

Exploration and development

The Company did not undertake any exploration at Castle Mountain during 2021.

Sustaining capital expenditures in Q4 2021 were $8.6 million for the leach pad expansion. Non-sustaining capital expenditures in Q4 2021 were $2.0 million primarily related to Phase 2 permitting and optimization.

During 2021 the Company spent $13.9 million of sustaining capital primarily related to the leach pad expansion but also for mining and process equipment. The Company incurred $7.8 million of non-sustaining expenditures related to the Phase 2 expansion, including water sourcing activities and completing the metallurgical laboratory.

Outlook

Castle Mountain production for 2022 is estimated at 25,000 to 35,000 ounces of gold with cash costs of $1,150 to $1,200 per oz and AISC of $1,475 to $1,525 per oz.

Costs at Castle Mountain are expected to increase primarily as the result of the decision to crush and agglomerate ore to increase ore permeability and gold production. AISC for 2022 includes $11 million of sustaining capital, with $3 million allocated for plant modifications and $7 million for the current leach pad expansion that is expected to accommodate the entirety of Phase 1 operations.

Non-sustaining growth capital of $9 million at Castle Mountain in 2022 includes $7 million for Phase 2 permitting, optimization studies and metallurgical test work, and nearly $2 million for exploration. The Company expects to submit Phase 2 permit applications in Q1 2022.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021

Los Filos Gold Mine, Guerrero, Mexico

Equinox Gold acquired Los Filos on March 10, 2020 as part of the Leagold Acquisition. Los Filos is located in Guerrero State, Mexico, and began production in 2008. Current operations comprise three open pits (Los Filos, Bermejal and Guadalupe), two underground mines (Los Filos and Bermejal) and secondary recovery from previously leached ores. Ore from the deposits is currently processed using heap leach recovery.

Operating and financial results for the three months and year ended December 31, 2021


		Three months ended			Year ended
Operating data	Unit	December 31, 2021	September 30, 2021	December 31, 2020	December 31, 2021	December 31, 2020 (1)
Ore mined - open pit	kt	3,423	1,754	—	7,090	496
Waste mined - open pit	kt	11,036	7,871	399	38,027	7,065
Open pit strip ratio	w:o	3.22	4.49	—	5.36	14.25
Average open pit gold grade	g/t	0.77	0.85	—	0.71	0.34
Ore mined - underground	kt	162	107	0.3	519	191
Average underground gold grade	g/t	3.11	3.11	1.83	3.23	4.00
Ore re-handled for secondary leaching	kt	—	—	403	2,312	4,547
Gold produced	oz	54,733	32,837	13,615	144,096	58,453
Gold sold	oz	55,144	32,112	13,740	143,809	59,135
Financial data
Revenue	M$	98.8	57.1	26.4	257.2	105.9
Cash costs(2)	M$	72.3	48.8	14.2	226.6	57.8
Sustaining capital(2)	M$	5.3	3.1	3.2	21.5	11.2
Reclamation expenses	M$	1.4	1.0	0.1	4.0	0.4
Total AISC(2)	M$	79.0	52.9	17.5	252.1	69.4
AISC contribution margin(2)	M$	19.7	4.2	8.9	5.1	36.4
Care and maintenance	M$	—	4.8	16.7	12.6	42.1
Non-sustaining expenditures(2)	M$	10.2	18.9	3.0	59.6	16.7
Mine free cash flow(2)	M$	9.5	(19.5)	(10.8)	(67.1)	(22.4)
Unit analysis
Realized gold price per oz sold	$/oz	1,787	1,769	1,932	1,783	1,786
Cash costs per oz sold(2)	$/oz	1,311	1,520	1,035	1,575	978
AISC per oz sold(2)	$/oz	1,433	1,647	1,276	1,753	1,174
Mining cost per tonne mined - open pit	$/t	1.50	1.52	1.85	1.45	1.65
Mining cost per tonne mined - underground	$/t	82.07	84.79	168.60	86.73	68.36
Processing cost per tonne processed	$/t	6.05	8.86	n/a	7.02	5.90
G&A cost per tonne processed	$/t	1.70	2.20	n/a	1.97	1.00

(1)Los Filos was acquired as part of the Leagold Acquisition. Operational and financial results are included from March 10, 2020, onward.

Q4 and 2021 Analysis

Production

During Q4 2021, Los Filos produced 54,733 ounces of gold (Q3 2021 - 32,837 ounces) at an AISC of $1,433 per oz (Q3 2021 - $1,647 per oz). The Company sold 55,144 ounces (Q3 2021 - 32,112 ounces) at an average realized price of $1,787 per oz (Q3 2021 - $1,769 per oz), recognizing revenue of $98.8 million (Q3 2021 - $57.1 million million) for the Quarter.

Production increased substantially compared to Q3 2021, reflecting a full Quarter of consistent operations. The open pit mining operations moved almost double the ore tonnes compared to Q3 2021, due mainly to the H1 2021 stripping campaigns delivering increased access to ore in the Guadalupe pit. AISC was again substantially lower than the prior quarter, reflecting an increase in ounces stacked and gold production. Development work continues for the new Bermejal underground deposit.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021

Los Filos exceeded 2021 guidance with total production of 144,096 ounces of gold compared to guidance of 120,000 to 140,000 ounces, and beat cost guidance with cash costs of $1,575 per oz and AISC of $1,753 per oz compared to guidance of $1,590 to $1,660 per oz for cash costs and $1,790 to $1,850 per oz for AISC.

Exploration and development

Exploration activities during Q4 2021 included continued testing of potential extensions of known mineralization and untested areas of the Los Filos underground deposit. A total of 3,032 m was drilled during Q4 2021, bringing the total completed for the year to 14,058 m. Additionally, a planned 11,000 m infill drill program for the Guadalupe open pit was expanded to 16,000 m, of which 3,032 m was drilled during the Quarter, bringing the total for the year to 16,033 m. Exploration costs for the Quarter totalled $1.7 million, with $6.5 million spent during the year.

Sustaining capital expenditures were $5.3 million during Q4 2021, primarily for underground development, open pit equipment and capital stripping. Non-sustaining capital expenditures of $10.2 million during the Quarter related primarily to equipment rebuilds to increase mining capacity, and Bermejal underground development costs.

During 2021 the Company spent $21.5 million of sustaining capital related to underground development, capital stripping and equipment overhauls and $59.6 million of non-sustaining expenditures related to Guadalupe capital stripping, Bermejal underground development and a new mobile fleet.

Outlook

Los Filos production for 2022 is estimated at 160,000 to 180,000 ounces of gold. While Los Filos’ costs are expected to be lower in the second half of the year, waste stripping campaigns in the Los Filos and Guadalupe open pits and underground development for Bermejal are expected to impact AISC and free cash flow for the year. Los Filos’ cost guidance for 2022 is estimated at cash costs of $1,400 to $1,475 per oz with AISC of $1,625 to $1,700 per oz.

The Company continues to review the potential to construct a new carbon-in-leach plant to operate concurrently with the existing heap leach operation, which could increase production and lower costs, but does not expect to make a construction decision until the majority of Greenstone expenditures are complete and the current stability with local communities allows operations to continue without interruption.

Capital investments at Los Filos during 2022 are expected to focus primarily on open-pit stripping and underground development, with almost $30 million of expenditures carried over from 2021. AISC at Los Filos in 2022 includes $38 million of sustaining capital, with $13 million allocated for capitalized stripping of the Guadalupe open pit, $7 million for development of the Los Filos underground mine, $10 million for fleet refurbishment and processing equipment and $4 million for exploration.

Non-sustaining growth capital of $62 million includes $23 million for stripping of the Los Filos open pit, $24 million for Bermejal underground development and $14 million for fleet rebuilds and new equipment.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021

Aurizona Gold Mine, Maranhão, Brazil

Aurizona is an open-pit gold mine located in northeastern Brazil that achieved commercial production in Q3 2019. In 2021 the Company completed a pre-feasibility study (“PFS”) demonstrating the opportunity for both mine life extension and increased annual gold production with development of an underground mine and satellite open-pit deposits that would operate concurrently with the existing open-pit mine.

Operating and financial results for the three months and year ended December 31, 2021


		Three months ended			Year ended
Operating data	Unit	December 31, 2021	September 30, 2021	December 31, 2020	December 31, 2021	December 31, 2020
Ore mined	kt	1,029	1,047	1,231	3,180	3,267
Waste mined	kt	7,727	5,077	7,301	20,442	19,901
Open pit strip ratio	w:o	7.51	4.85	5.93	6.43	6.09
Tonnes processed	kt	922	832	846	3,383	3,227
Average gold grade processed	g/t	1.51	1.42	1.59	1.35	1.41
Recovery	%	91.9	91.2	90.6	91.2	89.8
Gold produced	oz	41,258	34,583	37,438	134,961	130,237
Gold sold	oz	41,819	33,200	38,213	135,061	129,004
Financial data
Revenue	M$	75.1	59.4	71.6	242.6	229.6
Cash costs(1)	M$	31.0	26.8	23.3	105.9	92.4
Sustaining capital(1)	M$	12.3	4.7	10.6	26.7	24.4
Reclamation expenses	M$	0.3	0.3	0.5	1.3	2.7
Total AISC(1)	M$	43.6	31.8	34.4	133.9	119.5
AISC contribution margin(1)	M$	31.5	27.6	37.2	108.8	110.1
Non-sustaining expenditures(1)	M$	5.3	3.0	1.1	9.3	4.7
Mine free cash flow(1)	M$	26.2	24.6	36.1	99.5	105.4
Unit analysis
Realized gold price per oz sold	$/oz	1,797	1,790	1,874	1,796	1,780
Cash costs per oz sold(1)	$/oz	742	806	610	784	716
AISC per oz sold(1)	$/oz	1,044	957	901	991	926
Mining cost per tonne mined	$/t	2.04	1.91	1.78	2.09	1.87
Processing cost per tonne processed	$/t	9.19	12.04	8.18	9.65	8.44
G&A cost per tonne processed	$/t	4.06	4.90	4.14	4.12	4.10

Q4 and 2021 Analysis

Production

During Q4 2021, Aurizona produced 41,258 ounces of gold (Q3 2021 - 34,583 ounces) at an AISC of $1,044 per oz (Q3 2021 - $957 per oz). The Company sold 41,819 ounces (Q3 2021 - 33,200 ounces) at an average realized gold price of $1,797 per oz (Q3 2021 - $1,790 per oz), recognizing revenue of $75.1 million (Q3 2021 - $59.4 million) for the Quarter.

Production was higher and AISC was lower in the Quarter compared to Q3 2021 as there was improved access to higher grade ore benches in the lower portion of the pits and decreased reliance on lower-grade stockpiles for processing. Processing throughput of 922,000 tonnes in Q4 2021 set a new quarterly plant record and was 9% higher than the previous throughput record. Processing cost per tonne consequently decreased from Q3 2021 despite recent price inflation for consumables. Favorable foreign exchange rates continue to partially offset inflation.

Aurizona achieved production guidance with total 2021 production of 134,961 ounces compared to guidance of 130,000 to 140,000 ounces of gold. Cash costs were $784 per oz compared to guidance of $750 to $800 per oz, and AISC was $991 per oz compared to guidance of $1,025 to $1,075 per oz, due in part to lower capital expenditures as some TSF construction, capital stripping and land acquisitions were deferred into 2022.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021

Exploration and development

The 2021 Aurizona and district exploration program commenced in May as the seasonal rains subsided. The program was budgeted at $5.8 million and included drilling to add to the Mineral Reserve and Mineral Resource growth of the main Piaba deposit, Mineral Resource growth in near-mine deposits such as Tatajuba and Genipapo, and drill testing of several regional targets such as Touro. Drilling during the Quarter included 10,945 m at Piaba, 3,080 m at Tatajuba, 1,427 m at Touro, 1,343 m at Genipapo, and 4,625 m on other regional targets. The exploration expenditures for the Quarter totalled $5.1 million. A total of 31,189 m was drilled at Piaba and on near-mine and regional targets in 2021, with total exploration expenditures for the year of $8.3 million.

During Q4 2021, the Company spent $12.3 million of sustaining capital related primarily to work on the TSF raise and capitalized stripping. Non-sustaining expenditures were $5.3 million related to exploration and completion of the expansion PFS.

During 2021 the Company spent $26.7 million of sustaining capital related to capitalized stripping and TSF construction and $9.3 million of non-sustaining expenditures on exploration and progressing the Aurizona expansion.

Outlook

Aurizona production for 2022 is estimated at 120,000 to 130,000 ounces of gold with cash costs of $800 to $850 per oz and AISC of $1,175 to $1,225 per oz. Production during 2022 is expected to come from multiple ore sources, including Piaba East and the new Boa Esperança pit, which was opened up with a small stripping campaign during 2021.

Forecast AISC at Aurizona in 2022 includes $50 million of sustaining capital allocated primarily to $19 million in capitalized waste stripping, $18 million to construct a new TSF and increase capacity of the existing TSF and $8 million for infrastructure including installation of a new pebble crusher. With fresh rock feed expected to increase to 30% in 2022, the pebble crusher is expected to help to maintain processing capacity. Non-sustaining growth capital at Aurizona of $8 million is allocated almost entirely to exploration.

The Company expects to continue to advance the Aurizona expansion during 2022, with plans to initiate permitting for an exploration portal, undertake some underground-focused exploration and continue internal studies. Development work to access the underground deposit could begin in late 2022.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021

Fazenda Gold Mine, Bahia, Brazil

Equinox Gold acquired Fazenda on March 10, 2020 as part of the Leagold Acquisition. Fazenda is located in Bahia State, Brazil and has been in operation for more than two decades. Fazenda is primarily an underground operation complemented with some small open pits.

Operating and financial results for the three months and year ended December 31, 2021


		Three months ended			Year ended
Operating data	Unit	December 31, 2021	September 30, 2021	December 31, 2020	December 31, 2021	December 31, 2020 (1)
Ore mined - underground	kt	283	286	302	1,177	1,014
Tonnes processed	kt	351	348	332	1,367	1,087
Average gold grade processed	g/t	1.43	1.54	1.91	1.52	1.63
Recovery	%	90.9	89.7	89.9	90.5	90.6
Gold produced	oz	14,499	15,598	18,196	60,401	51,611
Gold sold	oz	14,279	15,727	18,237	60,269	51,056
Financial data
Revenue	M$	25.6	28.0	34.0	107.9	92.4
Cash costs(2)	M$	13.8	13.9	13.3	52.7	37.6
Sustaining capital(2)	M$	4.7	3.1	2.7	14.5	4.8
Reclamation expenses	M$	1.8	0.3	0.1	2.6	0.7
Total AISC(2)	M$	20.3	17.3	16.1	69.8	43.1
AISC contribution margin(2)	M$	5.3	10.7	17.9	38.1	49.3
Non-sustaining expenditures(2)	M$	0.8	1.3	2.1	5.5	4.6
Mine free cash flow(2)	M$	4.5	9.4	15.8	32.6	44.7
Unit analysis
Realized gold price per oz sold	$/oz	1,792	1,777	1,862	1,791	1,810
Cash costs per oz sold(2)	$/oz	963	884	728	875	737
AISC per oz sold(2)	$/oz	1,419	1,098	881	1,159	844
Mining cost per tonne mined	$/t	20.35	21.86	20.84	19.95	17.60
Processing cost per tonne processed	$/t	11.34	11.44	12.66	11.25	10.86
G&A cost per tonne processed	$/t	5.17	5.19	5.59	4.97	4.57

(1)Fazenda was acquired as part of the Leagold Acquisition. Operational and financial results are included from March 10, 2020, onward.

Q4 and 2021 Analysis

Production

During Q4 2021, Fazenda produced 14,499 ounces of gold (Q3 2021 - 15,598 ounces) at an AISC of $1,419 per oz (Q3 2021 - $1,098 per oz). The Company sold 14,279 ounces (Q3 2021 - 15,727 ounces) at an average realized price of $1,792 per oz (Q3 2021 - $1,777 per oz), recognizing revenue of $25.6 million (Q3 2021 - $28.0 million) for the Quarter.

Processed throughput of 351,000 tonnes in Q4 2021 set a new quarterly plant record but feed grades were lower than Q3 2021 due to mine sequencing in the underground and drawing more ore from open-pit sources. Lower grades were partly offset by higher recoveries due to less carbonaceous ore going through the plant. Mining unit costs in Q4 2021 were lower than Q3 2021 as prior maintenance activities to improve underground ore production were completed. AISC per oz was higher in the Quarter, largely due to lower gold production and also $4.7 million of sustaining capital spend in Q4 2021 for underground development.

With total production during 2021 of 60,401 ounces of gold, Fazenda achieved production guidance of 60,000 to 65,000 ounces. Cash costs were $875 per oz compared to guidance of $850 to $900 per oz, with AISC of $1,159 per oz compared to guidance of $1,100 to $1,150 per oz.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021

Exploration and development

The Company drilled a total of 16,564 m at Fazenda during Q4 2021. In the immediate mine area, underground drilling focused on Mineral Reserve replacement totalled 10,662 m, bringing the year-to-date total to 40,505 m. Regional reconnaissance drilling included 5,902 m of core drilling, bringing the totals for the year to 15,324 m of core and 13,040 m of RC drilling across nine large targets. Total regional exploration expenditures during the Quarter were $1.5 million, with $9.2 million spent during the year.

During Q4 2021, sustaining capital expenditures of $4.7 million focused primarily on underground development and capital stripping, as well as machinery and equipment. Non-sustaining capital of $0.8 million was for exploration.

During 2021 the Company spent $14.5 million on sustaining capital related primarily to underground development, as well as equipment and a TSF raise, with $5.5 million of non-sustaining expenditures related to exploration.

Outlook

Fazenda’s production for 2022 is estimated at 60,000 to 65,000 ounces of gold, with cash costs estimated at $975 to $1,025 per oz and AISC estimated at $1,200 to $1,250 per oz.

Of the $14 million sustaining capital investment planned for 2022, $6 million is allocated for underground development, $3 million for open-pit waste stripping, $2 million for exploration to upgrade inferred Mineral Resources and $2 million for engineering, plant maintenance and equipment. Non-sustaining growth capital of $11 million includes $4 million for underground development and $3 million for exploration.

In addition, the Company has planned a significant regional exploration program in the Fazenda-Santa Luz district, a 70-km-long greenstone belt that hosts both the Fazenda and Santa Luz mines. The 2022 regional exploration program includes a $1.5 million airborne geophysical survey that will cover the entire belt and is expected to greatly aid in the development of new targets and more than 50,000 metres of drilling targeting high priority near-mine and regional targets. Of the total $9 million non-sustaining capital spend, $4 million has been budgeted to Fazenda with the remainder budgeted to Santa Luz.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021

RDM Gold Mine, Minas Gerais, Brazil

Equinox Gold acquired RDM on March 10, 2020 as part of the Leagold Acquisition. RDM is located in Minas Gerais State, Brazil and commenced production in early 2014 as a conventional open-pit operation.

Operating and financial results for the three months and year ended December 31, 2021


		Three months ended			Year ended
Operating data	Unit	December 31, 2021	September 30, 2021	December 31, 2020	December 31, 2021	December 31, 2020 (1)
Ore mined	kt	346	682	680	1,768	1,981
Waste mined	kt	3,829	6,082	6,310	22,837	18,218
Open pit strip ratio	w:o	11.06	8.92	9.28	12.92	9.19
Tonnes processed	kt	713	755	714	2,835	2,218
Average gold grade processed	g/t	0.68	0.69	0.92	0.74	0.97
Recovery	%	87.6	86.2	86.4	86.7	85.6
Gold produced	oz	13,362	15,880	18,068	58,829	59,354
Gold sold	oz	13,424	16,140	18,263	59,074	58,723
Financial data
Revenue	M$	24.0	28.7	34.1	105.8	106.6
Cash costs(2)	M$	18.6	24.5	19.2	72.2	51.8
Sustaining capital(2)	M$	3.6	3.3	3.7	10.1	8.8
Reclamation expenses	M$	0.5	0.2	0.1	1.1	0.5
Total AISC(2)	M$	22.7	28.0	23.0	83.4	61.1
AISC contribution margin(2)	M$	1.3	0.7	11.1	22.5	45.5
Care and maintenance	M$	—	—	—	—	0.5
Non-sustaining expenditures(2)	M$	4.7	2.5	—	21.9	0.6
Mine free cash flow(2)	M$	(3.4)	(1.8)	11.1	0.6	44.4
Unit analysis
Realized gold price per oz sold	$/oz	1,789	1,779	1,857	1,791	1,805
Cash costs per oz sold(2)	$/oz	1,386	1,518	1,050	1,222	882
AISC per oz sold(2)	$/oz	1,689	1,733	1,261	1,410	1,041
Mining cost per tonne mined	$/t	2.73	2.18	1.58	2.04	1.64
Processing cost per tonne processed	$/t	10.65	10.05	9.03	10.04	8.52
G&A cost per tonne processed	$/t	3.12	2.46	2.37	2.68	1.98

(1)RDM was acquired as part of the Leagold Acquisition. Operational and financial results are included from March 10, 2020, onward.

Q4 and 2021 Analysis

Production

During Q4 2021, RDM produced 13,362 ounces of gold (Q3 2021 - 15,880 ounces) at an AISC of $1,689 per oz (Q3 2021 - $1,733 per oz). The Company sold 13,424 ounces (Q3 2021 - 16,140 ounces) at an average realized price of $1,789 per oz (Q3 2021 - $1,779 per oz), recognizing revenue of $24.0 million (Q3 2021 - $28.7 million) for the Quarter.

Production was lower in the Quarter compared to Q3 2021 as RDM received 958 millimetres (“mm”) of rain in Q4 2021, which is more than the region’s average annual rainfall of 800 mm. This had the effect of limiting access to the pits and instead RDM was reliant on processing lower-grade stockpile material for more than half the ore processed during the Quarter. Ore tonnes mined in Q4 2021 were higher grade than prior quarters due to mine sequencing. Unit costs were higher than Q3 2021, however, as the result of the atypical operating conditions.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021

Lower production during Q4 2021 caused RDM to miss guidance, with total production of 58,829 ounces compared to guidance of 60,000 to 65,000 ounces of gold. Costs were also higher than expected, with cash costs of $1,222 per oz compared to guidance of $1,000 to $1,050 per oz and AISC of $1,410 per oz compared to guidance of $1,175 to $1,225 per oz, as more non-sustaining capitalized waste stripping was included as operating expenses and Q4 2021 operations were heavily impacted by rainfall.

Exploration and development

The Company completed 3,565 m of core drilling during the Quarter and successfully concluded the 2021 exploration program, which was focused on near-mine Mineral Resource growth. Exploration expenditures during the Quarter totalled $0.7 million, with a total of 5,294 m drilled during the year at a cost of $0.8 million.

Sustaining capital expenditures in Q4 2021 were $3.6 million, related primarily to land acquisitions, the TSF raise and building and infrastructure. The Company spent $4.1 million of non-sustaining capital during the Quarter for capitalized stripping.

During 2021 the Company spent $10.1 million of sustaining capital related to the TSF, equipment and land acquisitions and $21.9 million of non-sustaining expenditures related to capitalized stripping.

Outlook

RDM production is expected to increase almost 30% compared to 2021 as the result of modifications to the pit design based on a new geotechnical model. Production for 2022 is estimated at 70,000 to 80,000 ounces of gold. Cash costs are estimated at $1,200 to $1,250 per oz and AISC is estimated at $1,350 to $1,400 per oz.

AISC at RDM in 2022 includes $11 million of sustaining capital, of which $9 million relates to increasing capacity of the TSF and installing a tailings thickener to reduce water consumption. Non-sustaining growth capital of $18 million relates primarily to capitalized stripping for a pushback of the open pit to provide better access to the ore body. In addition, the Company has allocated $3 million for exploration to undertake the first exploration campaign at RDM in several years, with a focus on potential extensions along strike and down dip.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021

Mercedes Gold Mine, Sonora, Mexico

Equinox Gold acquired Mercedes on April 7, 2021, as part of the Premier Acquisition. Mercedes is an underground gold-silver mine located in Sonora State, Mexico. In December 2021, the Company announced an agreement to sell Mercedes. The sale is expected to close around the end of Q1 2022, subject to customary closing conditions and regulatory approvals.

Operating and financial results for the three months and year ended December 31, 2021


		Three months ended			Year ended
Operating data	Unit	December 31, 2021	September 30, 2021	June 30, 2021(1)	December 31, 2021(1)
Ore mined - underground	kt	125	105	118	348
Tonnes processed	kt	161	109	128	398
Average gold grade processed	g/t	2.30	2.89	2.71	2.59
Recovery	%	95.4	95.7	96.2	95.8
Gold produced	oz	11,353	9,722	10,708	31,782
Gold sold	oz	10,266	10,253	10,416	30,935
Financial data
Revenue	M$	18.9	18.8	19.3	56.9
Cash costs(2)	M$	11.2	9.9	8.7	29.9
Sustaining capital(2)	M$	4.7	2.3	3.6	10.6
Reclamation expenses	M$	0.4	0.6	0.5	1.5
Total AISC(2)	M$	16.3	12.8	12.8	42.0
AISC contribution margin(2)	M$	2.6	5.8	6.5	15.0
Non-sustaining expenditures(2)	M$	0.5	0.3	0.2	0.9
Mine free cash flow(2)	M$	2.1	5.5	6.3	14.1
Unit analysis
Realized gold price per oz sold	$/oz	1,775	1,761	1,779	1,772
Cash costs per oz sold(2)	$/oz	1,091	970	839	966
AISC per oz sold(2)	$/oz	1,584	1,261	1,226	1,357
Mining cost per tonne mined - underground	$/t	33.38	38.67	34.91	35.38
Processing cost per tonne processed	$/t	18.56	21.23	20.58	19.94
G&A cost per tonne processed	$/t	14.19	17.39	14.54	15.18

(1)Mercedes was acquired as part of the Premier Acquisition. Operational and financial results are included from April 7, 2021, onward.

Q4 and 2021 Analysis

Production

During Q4 2021, Mercedes produced 11,353 ounces of gold (Q3 2021 - 9,722 ounces) at an AISC of $1,584 per oz (Q3 2021 - $1,261 per oz). The Company sold 10,266 ounces (Q3 2021 - 10,253 ounces) at an average realized price of $1,775 per oz (Q3 2021 - $1,761 per oz), recognizing revenue of $18.9 million (Q3 2021 - $18.8 million) for the Quarter.

Production for Q4 2021 was higher than Q3 2021 as increased development improved access to mining faces, resulting in a 20% increase in ore mined with similar ore grades. In addition, some low-grade stockpile material was processed in Q4 2021, utilizing spare capacity in the processing plant. Unit costs were lower in Q4 2021 due to increased underground development enabling more ore tonnes and production.

Mercedes achieved 2021 production guidance with production attributable to Equinox Gold in 2021 of 31,782 ounces of gold, compared to guidance of 30,000 to 35,000 ounces of gold. Cash costs of $966 per oz and AISC of $1,357 per oz were above the upper end of guidance of $750 to $800 per oz and $1,150 to $1,200 per oz, respectively, since Mercedes processed higher volumes of lower grade ore during 2021.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021

Exploration and development

Exploration drilling activities during Q4 2021 at Mercedes focused on Mineral Resource delineation and definition drilling programs, with 4,055 m of core drilling in 13 holes. A total of 7,151 m of exploration drilling was completed at Mercedes in 2021. Exploration expenditures totalled $0.5 million and $1.5 million for the Quarter and year, respectively.

Sustaining capital expenditures in Q4 2021 were $4.7 million, related primarily to underground mine development. The Company spent $0.5 million of non-sustaining capital on exploration during the Quarter.

During 2021, the Company spent $10.6 million of sustaining capital related to underground development and the TSF and $0.9 million of non-sustaining expenditures related to exploration.

Outlook

On December 16, 2021, the Company entered into an agreement to sell Mercedes to Bear Creek (the “Transaction”). The Transaction is expected to close around the end of Q1 2022. As such, 2022 guidance does not include Mercedes, although ounces produced and capital spent prior to closing will be attributable to Equinox Gold. For further detail about the Transaction, refer to the Corporate section of the MD&A.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


DEVELOPMENT PROJECTS

Santa Luz Project, Bahia, Brazil

The Company announced construction of Santa Luz on November 9, 2020 with an approved budget of $103 million.

Santa Luz is a past-producing open-pit mine in Bahia State, Brazil, that commenced operations in mid-2013 but was placed on care and maintenance in September 2014 partly due to lower than planned gold recovery. In May 2018, the previous owner of Santa Luz completed a feasibility study incorporating resin-in-leach processing to increase gold recoveries.

After acquiring the project in March 2020, Equinox Gold continued reviewing plans for the Santa Luz restart and published an update to the feasibility study on November 9, 2020, outlining a mine plan and plant design that is expected to produce 903,000 ounces of gold over an initial 9.5-year mine life, with additional upside from nearby exploration targets and existing underground Mineral Resources.

Q4 2021 analysis and outlook

As a brownfield past-producing mine, the majority of site services and infrastructure was already in place at Santa Luz. Primary activities to restart the mine include refurbishing existing infrastructure, retrofitting the plant, installing a new leach system and additional grinding capacity, and increasing the storage capacities of the existing tailings and water storage facilities. Construction progress is documented in the Santa Luz photo gallery on Equinox Gold’s website.

Of the $103 million total construction capital for the project, the Company had committed approximately $94 million and spent approximately $76 million through the end of December 2021, including expenditures incurred during 2020. Mining commenced in mid-June, with initial mining activities focused on removing waste from two locations and developing access roads, ramps, dumps and ore storage areas. Since mid-June, approximately 6.3 million tonnes of material was moved to either the waste area or used as backfill material for the water storage facility and TSF projects.

Santa Luz construction is more than 95% complete as of the date of this MD&A, and commissioning is underway in the SAG mill, ball mill, primary and secondary grinding and leach circuit. The project is on budget and on schedule, with first ore introduced into the plant in February and first gold expected in late March 2022.

Santa Luz production for 2022, including gold produced before commercial production, is estimated at 70,000 to 90,000 ounces of gold with cash costs of $825 to $925 per oz and AISC of $975 to $1,050 per oz sold. AISC at Santa Luz in 2022 includes $19 million of sustaining capital of which $11 million relates to open-pit stripping and $4 million for a TSF lift.

Approximately $27 million of non-sustaining construction capital remains to be spent in 2022, with an additional $5 million allocated to Fazenda-Santa Luz district exploration, as noted above.

Greenstone Project, Ontario, Canada

Greenstone is being advanced in a 60/40 partnership between Equinox Gold and Orion Mine Finance Group (“Orion”) through their respective interests in Greenstone Gold Mine GP Inc., which manages the project. The Company acquired a 50% interest in Greenstone in April 2021 with the Premier Acquisition, and subsequently purchased an additional 10% interest from Orion to bring its total interest in the project to 60%. Greenstone will be an open-pit mine with the expectation of producing more than 5 million ounces of gold over an initial 14-year mine life. Gold production for the first five years of operations is estimated at more than 400,000 ounces annually with life-of-mine production expected to average 360,000 ounces annually, with 60% attributable to Equinox Gold.

On October 27, 2021, Equinox Gold announced groundbreaking for full-scale construction of Greenstone with a construction budget of C$1.53 billion (100% basis) ($1.23 billion at a rate of USD:CAD 1.25). Construction will be funded on a pro rata basis with Equinox Gold funding 60% and Orion funding 40%. The initial capital estimate has been updated from the 2020 feasibility study estimate to reflect firm supplier quotes following detailed engineering, a review and update of capital costs, and an increased contingency including a provision for future inflation and potential COVID-19 costs. The initial cash spend could be reduced by approximately $100 million through lease financing for mobile equipment and offset economically by up to $70 million of pre-commercial production revenues (at a gold price of $1,750 per oz). Approximately 80% of the initial capital is Canadian-dollar based. With all financing and lender consents in place, construction commenced in December 2021.

Early works activities were completed in late Q3 2021 with commissioning of the temporary workforce camp, construction office and temporary effluent water treatment plant. Major construction activities got underway in Q4 2021 with contractors mobilized to commence construction on the TSF, the Goldfield Creek diversion, and the new portion of Highway 11. The second phase of tree clearing progressed during the Quarter. Plant site earthworks has advanced ahead of schedule and the first concrete pour was completed in December 2021.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


DEVELOPMENT PROJECTS (CONTINUED)

Greenstone Project, Ontario, Canada (Continued)

There was significant procurement activity during the Quarter, with contracts committed for the major process plant equipment, power plant generators, administration building, steel buildings, mine mobile equipment and explosives supply. The total value contracted to the end of January 2022 is $512 million (100% basis), representing 45% of the budgeted capital expenditures. The total value of fixed price contracts placed to date is $347 million (100% basis), which includes the full value of mine mobile equipment contracts during the capital expenditure phase, with $116 million awarded to Indigenous community companies or joint ventures. The Company spent $38.5 million during the Quarter and $65.6 million during 2021.

During 2022, Equinox Gold expects to fund $326 million of construction capital. Construction activities will be focused on the process plant, repositioning of existing infrastructure, installation of new infrastructure and mobile equipment, water and tailings management, power and electrical.

Activities in Q1 2022 are expected to focus on placing the majority of the remaining equipment contracts, advancing earthworks and concrete construction activities, and initiating preparatory works for steel erection that is expected to begin in Q2 2022 for the site administration building, permanent effluent water treatment plant, truck shop and process plant buildings.

Los Filos Expansion, Guerrero, Mexico

The Company is continuing planned expansion projects of the Los Filos gold mine complex with ongoing development of a second underground mine (Bermejal). The Company is also completing an updated feasibility study reviewing the potential to construct a new carbon-in-leach (“CIL”) plant to process higher-grade ore, operating concurrently with the existing heap leach operation.

Q4 2021 analysis and outlook

Development of the Bermejal underground mine continued during the Quarter. Underground development advanced 1,413 m during the Quarter and 20,253 tonnes of ore was mined with an average grade of 2.11 grams per tonne gold. Surface projects to support mining activities in Bermejal underground were also completed in the Quarter, including the extension of a power line, completion of a new substation and completion of the underground explosives magazine. A letter of award for the mine ventilation system was issued.

Engineering, optimization and metallurgical studies related to the new CIL plant continued through the Quarter. Life-of-mine planning and scheduling continues to be updated to reflect higher grade ore being fed to the CIL plant and lower grade ore going to the current heap leach operations. Environmental approvals were received for relocation of the CIL plant and for the updated tailings deposition location. The review process by CENACE (the national energy utility in Mexico responsible for energy regulation) for the proposed new electrical substation and power line extension required for the CIL plant and ancillary facilities is ongoing, with completion anticipated by early Q2 2022.

While the CIL plant is expected to increase annual production and reduce costs, the Company does not expect to make a construction decision until the majority of Greenstone expenditures are complete and the current stability with local communities allows operations to continue without interruption.

Castle Mountain Expansion, California, USA

Q4 2021 analysis and outlook

In March 2021, the Company announced the results of the feasibility study for a Phase 2 expansion at Castle Mountain. The current operation consists of a ROM heap leach facility placing 12,700 tonnes per day of ore. Phase 2 is expected to expand ROM heap leaching and incorporate milling of higher-grade ore, increasing production to an average of 218,000 ounces per year for 14 years followed by leach pad rinsing to recover residual gold. Life-of-mine production including Phase 1 operations and end of mine life rinsing is estimated at 3.4 million ounces of gold over a 21-year mine life. On a standalone basis, Phase 2 is expected to produce 3.2 million ounces of gold with AISC in the lower industry quartiles. Total initial capital for the Phase 2 expansion is estimated at $389 million, excluding $121 million for a leased mining fleet, with life-of-mine sustaining capital estimated at $147 million.

While Phase 2 is expected to operate within the existing approved mine boundary, the changes to previously analyzed impacts, such as increased land disturbance within the mine boundary and increased water use, will require amendments to the Company’s Mine and Reclamation Plan (Plan of Operation) for the Project. Work is progressing well on the mine plan amendment, specifically ensuring adequate water sources for the larger operation. Air quality and visual impacts have also been assessed. The feasibility study has undergone a gap analysis to determine where improvements can be made and incorporated into the next phase of engineering. The Company expects to submit the amendment to the mine plan for approval in Q1 2022.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


DEVELOPMENT PROJECTS (CONTINUED)

Aurizona Expansion, Brazil

Q4 2021 analysis and outlook

In November 2021, the Company filed a PFS providing more detail for the potential expansion at Aurizona. As announced in Q3 2021, the Company sees potential to extend the Aurizona mine life and increase annual production by mining new underground and satellite open-pit deposits concurrently with the existing open-pit mine.

During 2022 the Company plans to initiate permitting for an exploration portal, undertake some underground-focused exploration and continue to advance internal studies related to the expansion. Development work to access the underground deposit could begin in late 2022.


HEALTH, SAFETY AND ENVIRONMENT

Health & Safety

Equinox Gold had three lost-time injuries during the Quarter. The Company’s Lost-time Injury Frequency Rate (“LTIFR”) is 0.55 for the Quarter and 0.68 for 2021, compared to the 2021 target of 0.73 per million hours worked. The Company’s Total Reportable Injury Frequency Rate (“TRIFR”), which is a measure of all injuries that require the attention of medically trained personnel, is 2.92 for the Quarter and 3.05 for 2021, compared to the 2021 target of 3.51 per million hours worked.

Equinox Gold continues to maintain precautionary measures at all its operations to manage issues related to the COVID-19 pandemic with the primary goal of protecting the health, safety and economic wellbeing of the Company’s workforce and local communities. Each of the Company’s operations has implemented preventive measures in collaboration with the Company’s employees, contractors, host communities and governments to limit COVID-19 exposure and transmission as much as possible. The Company continues to enforce stringent operational and safety procedures in accordance with guidelines outlined by the World Health Organization, the US Centre for Disease Control, consulting health professionals, and the local, state and federal governments at each of its sites. Routine COVID-19 testing continues at all mine sites with the objective of identifying carriers early so they can self-isolate before inadvertently spreading the virus to others. While all of the Company’s sites have experienced some cases of COVID-19, most cases have been asymptomatic or have been managed in a way that allows production to continue while not putting employees and contractors at risk.

Environment

In total, there were 30 environmental incidents reported during the Quarter, with three considered “significant” as defined by the Company’s policies. One significant incident occurred at Castle Mountain when an unplanned power outage occurred and, when power was restored, the carbon-in-circuit (“CIC”) area pumps energized immediately to 100% power. The rush of pregnant solution overtopped the CIC tanks and secondary containment due to high winds. Approximately 600 gallons of pregnant solution was spilled out from the containment area and onto surrounding ground within the mine boundary. The contaminated soil was contained and disposed of on-site, without leaving mine boundaries, the incident was reported to government authorities and modifications were made to prevent recurrence. Another significant incident, as defined by Equinox Gold internal protocols, occurred at Castle Mountain when lime use exceeded permit conditions. A permit modification was immediately submitted to district staff to amend and increase the total annual volume of lime use allowed at Castle Mountain. A permit violation response letter was sent to the air district regulators and the Company received a permit violation penalty of $1,000, which was paid. The remaining significant incident occurred at Greenstone when the ammonia value discharged through the temporary effluent treatment plant (“TETP”) exceeded the regulatory limit as the result of blasting activities in the area. Greenstone has implemented procedures to more carefully track explosive volumes for each blast and to monitor collection ponds for ammonia, and has switched analytical laboratories to expedite turnaround time for water samples.

During 2021 the Company certified two mine sites in compliance with the International Cyanide Code. Los Filos, Mesquite and Fazenda are now certified. RDM, Aurizona and Castle Mountain are expected to be certified by early 2023. Greenstone and Santa Luz are expected to be certified within three years of achieving commercial production.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


COMMUNITY DEVELOPMENT & ESG REPORTING

Community Engagement

Equinox Gold engages in early, frequent and transparent dialogue with stakeholders as a means to build trust and provide a space for collaboration and long-term commitment. The Company maintains formal systems to identify stakeholders and communities of interest and strives to maintain strong local relationships by meeting regularly with host communities and Indigenous peoples to discuss activities, report on environmental and social performance and discuss concerns. At all operations, dedicated community departments seek feedback from local communities and stakeholders so that collaborative solutions to concerns can be implemented.

In Q4 2021, most sites had resumed in-person community meetings and events, which had been greatly curtailed by restrictions to social gatherings at the height of the pandemic. At Greenstone, the project team undertook a blasting awareness campaign to ensure local residents were informed and able to ask questions about the technical aspects of blasting and the construction blast schedule. At RDM, Fazenda and Santa Luz, community meetings and presentations to municipalities resumed to ensure that key information is available to a broad range of local stakeholders and that there is a forum to share interests and concerns. With the same objective, Los Filos, Greenstone and Caste Mountain hosted tours for government officials and local community leaders.

The Greenstone groundbreaking ceremony was attended by community members, government representatives and the leaders of each of the project’s Indigenous partners. Pictures and highlights from the groundbreaking ceremony speeches are available on Equinox Gold’s website.

In Q4 2021 Equinox Gold commenced a Human Rights assessment program to support the development of a Human Rights due diligence framework for the Company. As part of this process, comprehensive risk assessments were conducted at Aurizona and Los Filos. These third-party assessments included engagement with key internal and external stakeholders, such as community leaders, residents, and civil society organizations.

Community Development

Equinox Gold strives to leave a positive legacy of improved infrastructure, skills development and healthy, sustainable communities. The Company believes that mining projects should provide significant and long-term economic benefits and social development opportunities to local communities, ensuring that value generated locally benefits the communities affected most by the Company’s operations. The Company preferentially hires and procures locally and invests significantly in local infrastructure, health care, education, cultural and community programs. The Company also works with communities and governments to put programs in place that will help these benefits to continue well beyond the life of the mines. Moreover, Equinox Gold promotes and supports education with scholarships and training programs, supports health and wellbeing campaigns, and sponsors sports programs and cultural events.

In Q4 2021, several investments were made to support community development and quality of life improvements. At Aurizona, the construction of a new water treatment plant and retrofit of the water distribution infrastructure were completed in partnership with the local municipality. This new plant and water distribution network have greatly improved the water quality and reliability of service for the Aurizona village.

At Fazenda, the annual Community Development Seminar Program completed in Q4 2021 included the assessment of community development project proposals in the direct area of influence of the mine and identified 30 projects for direct support in 2022. Santa Luz kicked off its Young Apprentice Program, which provides entry level jobs to local students. Greenstone held a virtual Project Update Presentation to inform communities about job opportunities at the site and to provide guidance to local business interested in being a vendor or supplier.

Throughout the year, Equinox Gold operations made financial and in-kind contributions to safety and health promotion campaigns as well as local programs to address the challenges of the COVID-19 pandemic. In addition, the mine sites made donations to a variety of organizations and local governments to celebrate culturally relevant events and to support the most vulnerable in their area of influence.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


COMMUNITY DEVELOPMENT & ESG REPORTING (CONTINUED)

Environmental, Social & Governance (“ESG”) Reporting

Equinox Gold continues to publish select ESG data quarterly in the Responsible Mining section of the Company’s website and intends to expand the ESG metrics reported on the website in 2022.

During 2021 Equinox Gold published a Tailings Management Report and also reported for the first time its greenhouse gas emissions and energy data to the Carbon Disclosure Project. Both documents are available on the Company’s website. Additional disclosures using the Task Force on Climate-related Financial Disclosure (“TCFD”) framework are expected to be reported in 2022.

Equinox Gold prepared a materiality assessment to inform the Company’s 2021 ESG Report, which included a review of external sources as well as an extensive stakeholder survey in Q4 2021 with feedback from the Company’s workforce, community partners, Indigenous partners, investors and other stakeholders. The Company looks forward to continuously expanding its disclosure to facilitate an increased level of engagement and discussion with the Company’s stakeholders about salient ESG matters, and will publish its second ESG report in Q2 2022. The Company’s ESG reporting strategy includes the adoption of reporting frameworks such as the Global Reporting Initiative (“GRI”), the Sustainability Accounting Standards Board (“SASB”) and TCFD.


CORPORATE

Premier Acquisition

On April 7, 2021, Equinox Gold completed the Premier Acquisition, adding Premier’s 50% interest in the construction-ready Greenstone Project in Ontario, Canada, its 100% interest in the producing Mercedes Mine in Mexico, and its interest in the Hasaga, Rahill-Bonanza and Beardmore exploration properties in Ontario to the Company’s existing portfolio of gold assets.

Under the terms of the Premier Acquisition, the Company acquired 100% of the issued and outstanding shares of Premier at an exchange ratio of 0.1967 Equinox Gold common shares for each Premier share held (the “Exchange Ratio”), such that existing Equinox Gold and Premier shareholders own approximately 84% and 16% of Equinox Gold, respectively, on an issued share basis. All outstanding options and warrants of Premier that were not exercised before the acquisition date were replaced with Equinox Gold options and warrants, as adjusted in accordance with the Exchange Ratio. As a result of the Premier Acquisition, the Company issued 47,373,723 common shares, 2,813,747 replacement options and 393,400 replacement warrants. Total consideration paid to Premier shareholders was $408.3 million.

In connection with the Premier Acquisition, Premier completed the spin-out of i-80 Gold to Equinox Gold and to Premier shareholders. i-80 Gold is a US-focused gold production and development company that holds Premier’s former Nevada assets. Equinox Gold acquired 41,287,362 shares in connection with the spin-out i-80 Gold.

On April 7, 2021, the Company participated in an i-80 Gold private placement financing, purchasing 9,274,384 units at a price of C$2.60 per unit, for a total investment of $19.2 million (C$24.1 million). Each unit comprises one common share of i-80 Gold and one quarter of one common share purchase warrant. Each whole warrant entitles Equinox Gold to acquire one common share of i-80 Gold at a price of C$3.64 until September 18, 2022.

On May 27, 2021, the Company exercised its right under the support agreement between the Company and i-80 Gold to maintain its pro rata ownership and the Company subscribed for 5,479,536 common shares of i-80 Gold at a price of C$2.60 per common share, for a total investment of $11.8 million (C$14.2 million).

On December 9, 2021, the Company exercised its right under the support agreement between the Company and i-80 Gold to maintain its pro rate ownership and the Company subscribed to 4,800,000 common shares of i-80 Gold at a price of C$2.62 per common share, for a total investment of $9.9 million (C$12.6 million).

Concurrent financing

Concurrent with the Premier Acquisition, the Company completed a non-brokered private placement for C$75.0 million (the “Private Placement”). The Company issued 7.5 million common shares a price of C$10.00 per share for gross proceeds of C$75.0 million. Certain of the Company’s executives and directors participated in the Private Placement for total proceeds of C$40.4 million, which are related party transactions.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


CORPORATE (CONTINUED)

Increased ownership interest in Greenstone Project

On April 16, 2021, the Company completed the acquisition of 10% of Orion’s interest in Greenstone. The Company paid Orion $51.0 million in cash on closing and assumed certain contingent payment obligations comprising:

•$5.0 million in cash 24 months after a positive mine construction decision for Greenstone; and

•Delivery of approximately 2,200 ounces of refined gold, the cash equivalent value of such refined gold, or a combination thereof, after each production milestone of 250,000 ounces, 500,000 ounces and 700,000 ounces from Greenstone.

Sale of Pilar

On April 16, 2021, the Company completed the sale of Pilar to Pilar Gold for aggregate consideration of:

•$38 million payable as follows:

◦$10.5 million on closing and $10.0 million payable by May 31, 2021, which have been received; and

◦$17.5 million payable on or before November 30, 2021 (the “Third Installment”);

•9.9% equity interest in Pilar Gold; and a

•1% net smelter return royalty on production from Pilar.

On November 30, 2021, the Third Installment maturity date was extended to November 30, 2023.

Sale of shares in Solaris Resources

On April 28, 2021, the Company completed the sale of a portion of its shareholdings in Solaris totaling ten million common shares for gross proceeds of $66.7 million (C$82.5 million). In addition, Equinox Gold granted to the buyers warrants to purchase an additional five million Solaris common shares from the Company for a period of 12 months at C$10.00 per share (the “Warrants”). In the event all Warrants are exercised, total gross proceeds to Equinox Gold would be C$132.5 million.

Sale of Mercedes

On December 16, 2021, the Company entered into an agreement to sell Mercedes to Bear Creek for aggregate consideration of:

•$100 million in cash, payable as follows:

◦$75 million on closing of the Transaction; and

◦$25 million payable within six months of closing of the Transaction

•24,730,000 common shares of Bear Creek; and a

•2% net smelter return payable on production from Mercedes.

The sale is expected to close around the end of Q1 2022, subject to customary closing conditions and regulatory approvals.

Changes to Board of Directors

On December 30, 2021, the Company announced the appointment of François Bellemare to the Company’s Board of Directors, effective January 1, 2022. Mr. Bellemare is replacing Tim Breen as Mubadala Investment Company’s Board appointee.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


FINANCIAL RESULTS

Selected financial results for the three months and year ended December 31, 2021 and 2020


$ amounts in millions, except per share amounts	Three months ended				Year ended
	December 31, 2021		December 31, 2020		December 31, 2021(1)		December 31, 2020(2)
Revenue	$	381.2	$	255.5	$	1,082.3	$	845.4
Cost of sales
Operating expense	(215.5)		(114.1)		(654.8)		(423.3)
Depreciation and depletion	(66.4)		(43.7)		(196.9)		(131.9)
Earnings from mine operations	99.4		97.7		230.6		290.2
Care and maintenance expense	(0.1)		(29.4)		(15.3)		(65.0)
Exploration expense	(2.9)		(2.4)		(16.3)		(11.8)
General and administration expense	(17.3)		(16.1)		(52.6)		(40.4)
Income from operations	79.0		49.8		146.5		173.0
Finance expense	(10.3)		(8.6)		(41.6)		(39.8)
Finance income	1.1		0.6		2.8		1.8
Share of net income (loss) in associate	8.3		(3.1)		0.7		(5.4)
Other income (expense)	10.1		28.6		426.6		(86.5)
Net income before taxes	88.2		67.2		535.0		43.1
Income tax recovery (expense)	20.8		24.0		19.9		(20.8)
Net income	$	109.0	$	91.2	$	554.9	$	22.3
Net income per share attributable to Equinox Gold shareholders
Basic	$	0.37	$	0.38	$	1.95	$	0.10
Diluted	$	0.32	$	0.30	$	1.69	$	0.10

(1)Financial results for the year ended December 31, 2021 include the results of operations for the mines acquired through the Premier Acquisition for the period of April 7 to December 31, 2021.

(2)Financial results for the year ended December 31, 2020 include the results of operations for mines acquired through the Leagold Acquisition for the period of March 10 to December 31, 2020.

Earnings from mine operations

Revenue for Q4 2021 was $381.2 million (Q4 2020 - $255.5 million) on sales of 212,255 ounces of gold (Q4 2020 - 136,418 ounces) and for the year ended December 31, 2021 was $1.1 billion (year ended December 31, 2020 - $845.4 million) on sales of 602,668 ounces of gold (year ended December 31, 2020 - 473,309 ounces). The Company acquired Leagold in March 2020. The increase in revenue, operating expense and depreciation and depletion in 2021 compared to 2020 is primarily due to the impact of a full year of production from the operations acquired from Leagold in 2020. In addition, the increases compared to 2020 were also due to Castle Mountain which was under construction until late 2020 and Mercedes which was acquired in April 2021.

Operating expense increased in Q4 2021 to $215.5 million (Q4 2020 - $114.1 million million) and for the year ended December 31, 2021 to $654.8 million (year ended December 31, 2020 - $423.3 million). The increase in operating expense for the three months and year ended December 31, 2021 compared to the same periods in the prior year was due to higher sales volumes, and also due to higher mining and processing costs as a result of cost escalation for certain consumables, including diesel.

Depreciation and depletion in Q4 2021 increased to $66.4 million (Q4 2020 - $43.7 million) and for the year ended December 31, 2021 to $196.9 million (year ended December 31, 2020 - $131.9 million). The increase from Q4 2020 was due to a full period of operations from the Mercedes mine which was acquired in April 2021, a full year of production at Castle Mountain, which commenced operations in November 2020, and a full quarter of production at Los Filos in Q2 2021 compared to none in Q2 2020.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


FINANCIAL RESULTS (CONTINUED)

Care and maintenance

Care and maintenance expense in Q4 2021 were $0.1 million (Q4 2020 - $29.4 million) and for the year ended December 31, 2021 were $15.3 million (year ended December 31, 2020 - $65.0 million).

For the year ended December 31, 2021, the Company incurred $14.2 million in care and maintenance expense at Los Filos resulting from a delayed restart in the first quarter of 2021 following a community blockade from September to December 2020, and the temporary suspension of operations resulting from a community blockade from June to July 2021.

Care and maintenance expense in Q4 2020 related to the community blockade at Los Filos. For the year ended December 31, 2020, costs related to temporary suspensions at Los Filos, RDM and Pilar due to government mandated COVID-19 restrictions, in addition to costs incurred at Los Filos as a result of the community blockades and costs incurred at Santa Luz prior to approval of construction by the Board of Directors in November 2020.

Exploration

Exploration expense in Q4 2021 were $2.9 million (Q4 2020 - $2.4 million) and for the year ended December 31, 2021 were $16.3 million (year ended December 31, 2020 - $11.8 million). The increase in exploration expense from prior comparative periods is related to increased exploration activity at a larger number of properties as a result of the Premier Acquisition in April 2021 and Leagold Acquisition in March 2020.

General and administration

General and administration expense in Q4 2021 were $17.3 million (Q4 2020 - $16.1 million) and for the year ended December 31, 2021 were $52.6 million (year ended December 31, 2020 - $40.4 million). The increase in general and administration expense for the three months and year ended December 31, 2021 was largely due to an increase in salaries and wages due to the increased size of the Company. Included within general and administration expense for the three months and year ended December 31, 2021 was $0.8 million and $6.1 million of non-cash share-based compensation expense, respectively (three months ended December 31, 2020 - $1.4 million; year ended December 31, 2020 - $6.8 million). Also included in general and administration expense for the year ended December 31, 2021 was $2.4 million in transaction costs related to the Premier Acquisition (year ended December 31, 2020 - $5.8 million in transaction costs related to the Leagold Acquisition and Premier Acquisition).

Finance expense

Finance expense in Q4 2021 was $10.3 million (Q4 2020 - $8.6 million) and for the year ended December 31, 2021 was $41.6 million (year ended December 31, 2020 - $39.8 million) and relates mainly to interest expense on debt balances outstanding.

Finance income

Finance income in Q4 2021 was $1.1 million (Q4 2020 - $0.6 million) and for the year ended December 31, 2021 was $2.8 million (year ended December 31, 2020 - $1.8 million) and relates mainly to interest earned on cash balances.

Other income (expense)

Other income for Q4 2021 was $10.1 million (Q4 2020 - other income of $28.6 million) and for the year ended December 31, 2021 was other income of $426.6 million (year ended December 31, 2020 - other expense of $86.5 million).

Other income in Q4 2021 decreased compared to Q4 2020 mainly due to a loss on the change in fair value of gold contracts of $5.9 million (Q4 2020 - loss of $1.0 million) and an expected credit loss of $6.0 million (Q4 2020 - nil), partially offset by a gain of $27.5 million on the change in fair value of share purchase warrants (Q4 2020 - gain of $17.5 million). The Company also recognized a dilution gain on investment in associate of $2.1 million (Q4 2020 - $8.0 million), a loss on disposal of mineral properties, plant and equipment of $8.0 million (Q4 2020 - loss of $1.4 million).


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


FINANCIAL RESULTS (CONTINUED)

Other income (expense) (continued)

Other income for the year ended December 31, 2021 of $426.6 million was mainly due to a $186.1 million gain on reclassification of the Company’s investment in Solaris from cost to fair value accounting, a $50.3 million gain on the sale of Solaris shares, a $45.4 million gain on the sale of Pilar and an $81.4 million bargain purchase gain related to the Premier Acquisition in 2021. The Company also recognized a gain on change in fair value of share purchase warrants of $85.8 million (2020 - loss of $29.9 million), a gain on the change in fair value of gold contracts of $16.6 million (2020 - loss of $48.1 million), a loss on the change in fair value of foreign exchange contracts of $4.4 million (2020 - loss of $14.7 million), a foreign exchange loss of $0.2 million (2020 - gain of $12.1 million) and a loss on disposal of mineral properties, plant and equipment of $12.4 million (2020 - loss of $1.7 million).

Income tax recovery (expense)

In Q4 2021, the Company recognized a tax recovery of $20.8 million (Q4 2020 - tax recovery of $24.0 million). For the year ended December 31, 2021, the Company recognized tax recovery of $19.9 million (year ended December 31, 2020 - tax expense of $20.8 million).

The Company’s tax recovery for Q4 2021 was composed of current tax expense of $4.9 million (Q4 2020 - expense of $9.7 million) and a deferred tax recovery of $25.7 million (Q4 2020 - recovery of $33.7 million). The Company’s tax recovery for the year ended December 31, 2021 was composed of current tax expense of $25.2 million (year ended December 31, 2020 - expense of $35.1 million) and a deferred tax recovery of $45.0 million (year ended December 31, 2020 - recovery of $14.2 million). The increase in the deferred tax recovery for the year ended December 31, 2021 compared to the comparative period in 2020 was primarily due to the impact of an internal restructuring during 2021.

Selected annual information


$ amounts in millions, except per share amounts	Year ended December 31,
	2021		2020		2019
Revenue	$	1,082.3	$	845.4	$	281.7
Net income (loss) attributable to Equinox Gold shareholders	554.9		22.3		(18.4)
Basic income per share attributable to Equinox Gold shareholders	1.95		0.10		(0.16)
Diluted income per share attributable to Equinox Gold shareholders	1.69		0.10		(0.16)
Total assets	3,967.4		2,673.4		839.4
Total non-current liabilities	979.5		1,002.2		304.4


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


FINANCIAL RESULTS (CONTINUED)

Selected quarterly information

The following tables set out selected unaudited consolidated quarterly results for the last eight quarters through December 31, 2021:


$ amounts in millions, except per share amounts	December 31, 2021		September 30, 2021		June 30, 2021		March 31, 2021
Revenue	$	381.2	$	245.1	$	226.2	$	229.7
Cost of sales
Operating cost	(215.5)		(152.7)		(139.9)		(146.8)
Depreciation and depletion	(66.4)		(46.8)		(45.0)		(38.7)
Earnings from mine operations	99.3		45.6		41.3		44.2
Care and maintenance expense	(0.1)		(6.0)		(7.1)		(2.0)
Exploration expense	(2.9)		(5.6)		(4.7)		(3.0)
General and administration expense	(17.3)		(12.4)		(15.5)		(7.4)
Income from operations	79.0		21.6		14.0		31.8
Finance expense	(10.3)		(10.7)		(11.8)		(8.7)
Finance income	1.1		1.1		0.2		0.4
Share of net income (loss) in associate	8.3		(5.3)		0.4		(2.7)
Other income (expense)	10.1		(18.0)		385.2		49.3
Net income (loss) before taxes	88.2		(11.3)		388.0		70.1
Income tax recovery (expense)	20.8		3.2		15.8		(20.0)
Net income (loss)	$	109.0	$	(8.1)	$	403.8	$	50.1
Net income (loss) per share attributable to Equinox Gold shareholders,
Basic	$	0.37	$	(0.03)	$	1.37	$	0.21
Diluted	$	0.32	$	(0.03)	$	1.19	$	0.14


	December 31, 2020		September 30, 2020		June 30, 2020		March 31, 2020
Revenue	$	255.5	$	244.5	$	215.4	$	130.0
Cost of sales
Operating cost	(114.1)		(119.7)		(113.0)		(76.5)
Depreciation and depletion	(43.7)		(36.1)		(35.2)		(16.9)
Earnings from mine operations	97.7		88.7		67.2		36.6
Care and maintenance expense	(29.4)		(13.1)		(21.6)		(0.9)
Exploration expense	(2.4)		(2.9)		(3.9)		(2.6)
General and administration expense	(16.1)		(8.1)		(9.6)		(6.7)
Income from operations	49.8		64.6		32.1		26.4
Finance expense	(8.6)		(12.8)		(11.4)		(6.8)
Finance income	0.5		0.6		0.4		0.3
Share of net loss in associate	(3.1)		(0.9)		(0.4)		(1.0)
Other income (expense)	28.6		(38.7)		(93.1)		16.6
Net income (loss) before taxes	67.2		12.8		(72.4)		35.5
Income tax recovery (expense)	24.0		(9.7)		(5.3)		(29.8)
Net income (loss)	$	91.2	$	3.1	$	(77.7)	$	5.7
Net income (loss) per share attributable to Equinox Gold shareholders,
Basic	$	0.38	$	0.01	$	(0.34)	$	0.04
Diluted	$	0.30	$	0.01	$	(0.34)	$	0.04


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


LIQUIDITY AND CAPITAL RESOURCES

Working capital

Cash and cash equivalents at December 31, 2021 were $305.5 million (December 31, 2020 - $344.9 million) and net working capital was $760.7 million (December 31, 2020 - $423.4 million). The increase in working capital from 2020 is due to the change in marketable securities, derivative assets and assets held for sale explained below.

Trade and other receivables at December 31, 2021 were $50.3 million (December 31, 2020 - $55.9 million), mainly comprised of $14.2 million of trade receivables from gold sales (December 31, 2020 - $17.2 million), $24.6 million of value-added taxes receivable from the Brazilian and Mexican governments (December 31, 2020 - $19.0 million) and income tax receivables of $8.0 million (December 31, 2020 - $10.1 million).

Current inventory at December 31, 2021 was $201.6 million (December 31, 2020 - $208.3 million). The decrease was mainly due to a decrease in heap leach inventories at Los Filos as operations resumed in January 2021 following the community blockade in 2020, which resulted in a build-up of inventory at the end of 2020.

Current derivative assets at December 31, 2021 were $124.2 million (December 31, 2020 - $— million). The increase was mainly due to a reclassification of the Company’s Solaris share purchase warrants from non-current to current in 2021.

Assets held for sale at December 31, 2021 were $207.5 million (December 31, 2020 - $— million). Assets held for sale relate to the sale of Mercedes to Bear Creek announced in December 2021. The sale is expected to close around the end of Q1 2022.

Other current assets at December 31, 2021 were $274.1 million (December 31, 2020 - $36.9 million) and relate primarily to marketable securities and prepaid expenses. The increase in other current assets was due to reclassification of the Company’s investment in Solaris to marketable securities in Q2 2021 after the Company determined it no longer had significant influence over Solaris. The carrying value of the Company’s investment in Solaris was $238.6 million at December 31, 2021.

Current liabilities at December 31, 2021 were $402.6 million (December 31, 2020 - $222.7 million). The increase in current liabilities was mainly due to reclassification of $85.7 million liabilities at Mercedes to held for sale, a $59.6 million increase in accounts payable and accrued liabilities driven by timing of payments and a $13.3 million increase in the current portion of long-term debt related to principal repayments on the Company’s term loan due within the next 12 months.

Cash flow

The Company generated $155.4 million in cash from operations in Q4 2021 (Q4 2020 - $90.1 million) and $320.8 million in the year ended December 31, 2021 (year ended December 31, 2020 - $255.8 million). The increase in cash from operations for Q4 2021 was primarily due to the impact of higher production and sales, in addition to positive working capital changes in accounts payable associated with the resumption of operations at Los Filos and timing of payments at other operating sites. The increase in cash from operations for the year ended December 31, 2021 was mainly due to a decrease in care and maintenance costs incurred as compared to the year ended December 31, 2020 and positive working capital changes in accounts payable associated with the resumption of operations at Los Filos and timing of payments at Greenstone, as well as other operating sites.

Cash used in investing activities in Q4 2021 was $126.0 million (Q4 2020 - $58.2 million) and $347.6 million in the year ended December 31, 2021 (year ended December 31, 2020 - $131.2 million). In Q4 2021, the Company incurred $107.4 million of capital expenditures (Q4 2020 - $52.8 million). The increase in capital expenditures was driven by pre-development work and construction at Greenstone and construction at Santa Luz, as well as higher capital spend at Los Filos, mainly due to underground mine development at Bermejal. Investing activities in Q4 2021 also included $9.9 million invested in i-80 Gold compared to $8.1 million invested in Solaris in Q4 2020. For the year ended December 31, 2021, the Company incurred $344.2 million of capital expenditures (year ended December 31, 2020 - $174.8 million). The increase in capital expenditures was driven by pre-development work at Greenstone and development work at Santa Luz, higher deferred stripping costs at Los Filos, Mesquite and RDM and higher mine development costs at Fazenda, offset partially by lower spend at Castle Mountain as the mine entered commercial production in Q4 2020. Investing activities for the year ended December 31, 2021 also included $50.9 million spent to acquire an additional 10% interest in Greenstone and $40.9 million invested in i-80 Gold, offset partially by $90.5 million in net proceeds on the disposal of assets, which included $66.7 million received from the sale of Solaris shares and $22.2 million from the sale of Pilar. Investing activities for the year ended December 31, 2020 included $55.3 million of cash acquired related to the Leagold Acquisition.

Cash used in financing activities in Q4 2021 was $20.2 million (Q4 2020 - $3.1 million used in financing activities) and cash generated by financing activities was $1.6 million in the year ended December 31, 2021 (year ended December 31, 2020 - $152.7 million generated by financing activities). In Q4 2021, the Company repaid $6.7 million of principal on its term loan, paid $6.1 million in finance fees and $8.2 million in lease payments. In Q4 2020, the Company paid $5.3 million in finance fees.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


LIQUIDITY AND CAPITAL RESOURCES (CONTINUED)

During the year ended December 31, 2021, the Company received $59.5 million in proceeds from the private placement completed concurrent with the Premier Acquisition and $17.7 million in proceeds from the exercise of share purchase options and warrant exercises. This was offset by $31.0 million repayment of loans and borrowings, including $17.6 million paid to settle Premier’s credit facility upon completion of the acquisition, $24.3 million of lease payments and $22.1 million in finance fees paid. During the year ended December 31, 2020, the Company received aggregate proceeds of $171.5 million from the exercise of share purchase options and warrants, issued $139.3 million in convertible notes, drew $379.7 million from its senior secured credit facilities and completed a $42.8 million private placement concurrent with the Leagold Acquisition. The proceeds were offset by $546.3 million in debt repayments, including extinguishment of $323.9 million debt outstanding in Leagold at the acquisition date, and $26.5 million in finance fees paid.


LIQUIDITY AND CAPITAL RESOURCES (CONTINUED)

Share capital transactions

The Company issued shares in conjunction with the following transactions during the period:


			Number of Common Shares
Balance December 31, 2020			242,354,406
Issued in Premier Acquisition			47,373,723
Issued in Private Placement			7,500,000
Issued on exercise of warrants, stock options and vested restricted share units (“RSU”)			4,096,475
Balance December 31, 2021			301,324,604


OUTSTANDING SHARE DATA

As at the date of this MD&A, the Company has 302,712,835 shares issued and outstanding, 2,793,319 shares issuable under stock options, 1,276,117 shares issuable under share purchase warrants and 4,586,202 shares issuable under RSU. The Company also has 44,458,207 shares issuable under Convertible Notes. The fully diluted outstanding share count at the date of this MD&A is 355,826,680.


COMMITMENTS AND CONTINGENCIES

The Company enters into contracts in the normal course of business that give rise to commitments for future payments. The following table summarizes the contractual maturities of the Company's financial liabilities, and operating and capital purchase commitments at December 31, 2021:


	Within 1 year		1-2 years		2-3 years		3-4 years		4–5 years		Thereafter		Total
Accounts payable and accrued liabilities	$	185,716	$	—	$	—	$	—	$	—	$	—	$	185,716
Loans and borrowings(1)(2)	48,261		47,489		376,364		147,223						619,337
Derivative liabilities	44,825		572										45,397
Lease liabilities(2)	19,362		18,742		9,010		6		6		13		47,139
Other financial liabilities(2)	—		5,000		—		—		—		—		5,000
Reclamation and closure costs(2)	3,748		6,576		8,311		10,008		8,724		145,314		182,681
Purchase commitments(2)	94,241		9,524		4,608		2,214		1,295		2		111,884
Other operating commitments(2)	30,546		31,766		33,035		17,796		18,508		48,763		180,414
Total	$	426,699	$	119,669	$	431,328	$	177,247	$	28,533	$	194,092	$	1,377,568

(1)Amount includes principal and interest payments, except accrued interest which is included in accounts payable and accrued liabilities

(2)Amounts represent undiscounted future cash flows


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


COMMITMENTS AND CONTINGENCIES (CONTINUED)

At December 31, 2021, the Company had the following outstanding matters:

Legal

Tax

Environmental

A historic rain event caused widespread flooding in the Aurizona region in late March 2021 and a fresh water pond on the Aurizona site overflowed during the rain event. The tailings facility and other infrastructure at the Aurizona site remained operational.The has Company received notices from the local state government of environmental infractions related to turbidity in the local water supply at Aurizona with associated fines totaling $9.2 million. In addition to the fines, a pubic civil action has been filed against the Company by the State prosecutor claiming various damages as a result of the rain event. The Company and its advisors believe the fines and public civil action are without merit and it is not probable that a cash outflow will occur. Accordingly, no amount has been recognized in relation to the fines.

COVID-19

The above matters could have an adverse impact on the Company's financial performance, cash flows and results of operations if they are not resolved favorably.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


RELATED PARTY TRANSACTIONS

In April 2021, the Company issued $32.1 million of its common shares to its executives and directors under a private placement.

The remuneration of the Company's directors and other key management personnel during the years ended December 31, 2021 and 2020 were as follows:


	2021		2020
Salaries, directors' fees and other short-term benefits	$	4.2	$	6.8
Share-based payments	5.0		3.4
Total key management personnel compensation	$	9.2	$	10.2

At December 31, 2021, $2.0 million (2020 - $2.0 million) was owed by the Company to management for accrued salaries and bonuses and reimbursement of expenses.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


NON-IFRS MEASURES

This MD&A refers to cash costs, cash costs per oz sold, AISC, AISC per oz sold, AISC contribution margin, adjusted net income, adjusted EPS, mine-site free cash flow, adjusted EBITDA, net debt, and sustaining and non-sustaining capital expenditures that are measures with no standardized meaning under IFRS, i.e. they are non-IFRS measures, and may not be comparable to similar measures presented by other companies. Their measurement and presentation is consistently prepared and is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. Numbers presented in the tables below may not sum due to rounding.

Cash costs and cash costs per oz sold

Cash costs is a common financial performance measure in the gold mining industry; however, it has no standard meaning under IFRS. The Company reports total cash costs on a per oz sold basis. The Company believes that, in addition to conventional measures prepared in accordance with IFRS, certain investors use this information to evaluate the Company’s performance and ability to generate operating income and cash flow from mining operations. Cash costs include mine site operating costs plus lease principal payments, but are exclusive of depreciation and depletion, reclamation, capital and exploration costs and net of by-product sales and then divided by ounces sold to arrive at cash costs per oz sold. The measure is not necessarily indicative of cash flow from operations under IFRS or operating costs presented under IFRS.

AISC per oz sold

The Company is reporting AISC per oz of gold sold. The methodology for calculating AISC was developed internally and is calculated below. Readers should be aware that this measure does not have a standardized meaning. Current IFRS measures used in the gold industry, such as operating expenses, do not capture all of the expenditures incurred to discover, develop and sustain gold production. The Company believes the AISC measure provides further transparency into costs associated with producing gold and will assist analysts, investors and other stakeholders of the Company in assessing its operating performance, its ability to generate free cash flow from current operations and its overall value.

The following table provides a reconciliation of cash costs per oz of gold sold and AISC per oz of gold sold to the most directly comparable IFRS measure on an aggregate basis.


$’s in millions, except ounce and per oz figures	Three months ended						Year ended
	December 31, 2021		September 30, 2021		December 31, 2020		December 31, 2021		December 31, 2020
Gold ounces sold	212,255		137,144		136,418		602,668		473,309
Operating expenses	$	215.5	$	152.7	$	114.1	$	654.8	$	423.3
Lease payments	3.8		2.8		2.2		9.2		4.3
Non-recurring charges recognized in operating expenses (1)	(0.4)		(1.7)		—		(2.1)		—
Fair value adjustment on acquired inventories	1.8		(1.7)		(1.1)		(6.6)		(26.6)
Total cash costs	$	220.7	$	152.1	$	115.2	$	655.3	$	401.0
Cash costs per gold oz sold	$	1,040	$	1,109	$	844	$	1,087	$	847
Total cash costs	$	220.7	$	152.1	$	115.2	$	655.3	$	401.0
Sustaining capital	42.4		26.9		31.5		144.7		76.3
Reclamation expenses	5.5		2.4		1.1		13.1		6.3
Sustaining exploration expensed	—		0.6		0.4		0.6		1.6
Total AISC	268.7		182.0		148.1		813.7		485.1
AISC per oz sold	$	1,266	$	1,327	$	1,086	$	1,350	$	1,025

(1)Non-recurring charges recognized in operating expenses relates to an impairment charge on replacement parts at Mesquite.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


NON-IFRS MEASURES (CONTINUED)

Sustaining and non-sustaining capital reconciliation

Sustaining capital expenditures are defined as those expenditures which do not increase annual gold ounce production at a mine site and excludes all expenditures at the Company’s projects and certain expenditures at the Company’s operating sites which are deemed expansionary. Sustaining capital expenditures can include, but are not limited to, capitalized stripping costs at open pit mines, underground mine development, mining and milling equipment and tailings dam raises.

The following table provides a reconciliation of sustaining capital expenditures to the Company’s total capital expenditures for continuing operations.


	Three months ended						Year ended
$’s in millions	December 31, 2021		September 30, 2021		December 31, 2020		December 31, 2021		December 31, 2020
Capital additions to mineral properties, plant and equipment(1)	$	135.4	$	99.7	$	50.8	$	455.3	$	179.1
Less: Non-sustaining capital at operating sites	(23.4)		(25.6)		(6.0)		(101.3)		(32.4)
Less: Non-sustaining capital at development projects	(62.4)		(39.0)		(10.8)		(137.7)		(51.1)
Less: Capital expenditures - corporate	(0.1)		(0.2)		(0.1)		(1.0)		(0.4)
Less: Other non-cash additions(2)	(7.1)		(8.0)		(2.4)		(70.6)		(18.9)
Sustaining capital expenditures	$	42.4	$	26.8	$	31.5	$	144.7	$	76.3

(1)Per note 10 of the consolidated financial statements. Capital additions are exclusive of non-cash changes to reclamation assets arising from changes in discount rate and inflation rate assumptions in the reclamation provision.

(2)Non-cash additions include right-of-use assets associated with leases recognized in the period, capitalized depreciation for deferred stripping activities, and the mineral interest recognized relating to the Pilar royalty.

Total mine-site free cash flow

Mine-site free cash flow is a non-IFRS financial performance measure. The Company believes this to be a useful indicator of its ability to operate without reliance on additional borrowing or usage of existing cash. Mine-site free cash flow is intended to provide additional information only and does not have any standardized meaning under IFRS and may not be comparable to similar measures of performance presented by other mining companies. Mine-site free cash flow should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.

The following table provides a reconciliation of mine-site free cash flow to the most directly comparable IFRS measure on an aggregate basis:


	Three months ended						Year ended
$’s in millions	December 31, 2021		September 30, 2021		December 31, 2020		December 31, 2021		December 31, 2020
Operating cash flow before non-cash changes in working capital	$	122.2	$	48.3	$	94.0	$	264.1	$	271.0
Add: Operating cash flow used by non-mine site activity(1)	32.7		36.9		36.3		136.4		130.2
Cash flow from operating mine sites	$	154.9	$	85.2	$	130.3	$	400.5	$	401.2

Mineral property, plant and equipment additions	$	135.4	99.7		50.8		$	455.3	179.1
Less: Capital expenditures relating to development projects and corporate and other non-cash additions	(69.6)		(47.3)		(13.3)		(209.4)		(70.4)
Capital expenditure from operating mine sites	65.8		52.4		37.5		245.9		108.7
Lease payments related to non-sustaining capital items	3.5		4.1		—		13.7		—
Non-sustaining exploration expensed	3.0		2.1		1.2		9.9		3.8
Total mine site free cash flow	$	82.7	$	26.6	$	91.6	$	131.0	$	288.7

(1)Includes taxes paid that are not factored into mine site free cash flow and are included in operating cash flow before non-cash changes in working capital in the statement of cash flows.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


NON-IFRS MEASURES (CONTINUED)

EBITDA, adjusted EBITDA and AISC contribution margin

The Company believes that, in addition to conventional measures prepared in accordance with IFRS, certain investors use adjusted EBITDA and AISC contribution margin to evaluate the Company’s performance and ability to generate cash flows and service debt. EBITDA is defined as earnings before interest, tax, depreciation and amortization. Adjusted EBITDA is defined as earnings before interest, tax, depreciation, and amortization, adjusted to exclude specific items that are significant but not reflective of the underlying operating performance of the Company, such as the impact of fair value changes in the value of warrants, foreign exchange contracts and gold contracts, unrealized foreign exchange gains and losses, and share-based compensation expense. It is also adjusted to exclude items whose timing or amount cannot be reasonably estimated in advance or that are not considered representative of core operating performance, such as impairments and gains and losses on disposals of assets. AISC contribution margin is defined as revenue less AISC.

Previously, adjusted EBITDA was calculated excluding the Company’s share of net income or loss on investment in associate as an adjusting item. The Company has adjusted for its share of net income or loss on investment in associate in the current period as this item is not considered representative of core operating performance. The comparative periods have been adjusted to confirm with the current methodology and are different from those previously reported.

The following tables provide the calculation of AISC contribution margin, EBITDA and adjusted EBITDA, as calculated by the Company:

AISC Contribution Margin


	Three months ended						Year ended
$’s in millions	December 31, 2021		September 30, 2021		December 31, 2020		December 31, 2021		December 31, 2020
Revenue	$	381.2	$	245.1	$	255.5	$	1,082.3	$	845.4
Less: AISC	(268.7)		(182.0)		(148.1)		(813.7)		(485.1)
AISC contribution margin	$	112.6	$	63.1	$	107.4	$	268.6	$	360.2


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


NON-IFRS MEASURES (CONTINUED)

EBITDA and Adjusted EBITDA


	Three months ended						Year ended
$’s in millions	December 31, 2021		September 30, 2021		December 31, 2020		December 31, 2021		December 31, 2020
Net income (loss) before tax	$	88.2	(11.3)		67.2		$	535.0	43.1
Depreciation and depletion	66.7		47.2		43.8		198.1		132.6
Finance expense	10.3		10.7		8.6		41.6		39.8
Finance income	(1.1)		(1.1)		(0.6)		(2.8)		(1.8)
EBITDA	$	164.1	$	45.5	$	119.1	$	771.9	$	213.6
Non-cash share-based compensation expense	0.8		1.6		1.4		6.1		6.8
Unrealized (gain) loss on change in fair value of warrants	(27.5)		(1.0)		(17.5)		(85.8)		29.9
Unrealized (gain) loss on gold contracts	(4.3)		(11.0)		(11.2)		(58.1)		12.9
Unrealized (gain) loss on foreign exchange contracts	(1.7)		8.9		(11.1)		(0.4)		14.1
Unrealized foreign exchange (gain) loss	(10.8)		3.8		1.3		(5.9)		(12.1)
Non-recurring charges recognized in operating expense(1)	0.4		1.7		—		2.1		—
Transaction costs	0.5		—		3.2		2.4		5.8
Share of net (income) loss on investment in associate	(8.3)		5.3		3.1		(0.7)		5.4
Other expense (income)(2)	16.8		12.6		(3.1)		(328.4)		5.9
Adjusted EBITDA	$	130.0	$	67.3	$	85.3	$	303.1	$	282.3

(1)Non-recurring charges recognized in operating expenses relates to an impairment charge on replacement parts at Mesquite.

(2)Other expense for the three months ended December 31, 2021 includes $8.0 million loss on disposal of mineral properties, plant and equipment and $6.0 million expected credit loss. Other income for the year ended December 31, 2021 includes $186.1 million gain on reclassification of Solaris investment from cost to fair value accounting, $50.3 million gain on sale of Solaris shares, $45.4 million gain on sale of Pilar, $81.4 million bargain purchase gain on Premier Acquisition, $12.4 million loss on disposal of mineral properties, plant and equipment and $7.0 million expected credit loss.

Adjusted net income and adjusted EPS

Adjusted net income and adjusted EPS are used by management and investors to measure the underlying operating performance of the Company. Adjusted net income is defined as net income adjusted to exclude specific items that are significant but not reflective of the underlying operating performance of the Company, such as the impact of fair value changes in the value of warrants, foreign exchange contracts and gold contracts, unrealized foreign exchange gains and losses, and non-cash share-based compensation expense. It is also adjusted to exclude items whose timing or amount cannot be reasonably estimated in advance or that are not considered representative of core operating performance, such as impairments and gains and losses on disposals of assets. Adjusted net income per share amounts are calculated using the weighted average number of shares outstanding on a basic and diluted basis as determined by IFRS.

Previously, adjusted net income was calculated excluding the Company’s share of net income or loss on investment in associate as an adjusting item. The Company has adjusted for its share of net income or loss on investment in associate in the current period as this item is not considered representative of core operating performance. The comparative periods have been adjusted to confirm with the current methodology and are different from those previously reported.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


NON-IFRS MEASURES (CONTINUED)

The following table provides the calculation of adjusted net income and adjusted EPS, as adjusted and calculated by the Company:


	Three months ended						Year ended
$’s in millions	December 31, 2021		September 30, 2021		December 31, 2020		December 31, 2021		December 31, 2020
Basic weighted average shares outstanding	300,790,672		300,513,742		242,118,375		284,932,357		212,487,729
Diluted weighted average shares outstanding	348,996,674		300,513,742		290,888,147		333,734,701		218,411,971
Net income (loss) attributable to Equinox Gold shareholders	$	109.0	$	(8.1)	$	91.2	$	554.9	$	22.3
Add (deduct):
Non-cash share-based compensation expense	0.8		1.6		1.4		6.1		6.8
Unrealized (gain) loss on change in fair value of warrants	(27.5)		(1.0)		(17.5)		(85.8)		29.9
Unrealized (gain) loss on gold contracts	(4.3)		(11.0)		(11.2)		(58.1)		12.9
Unrealized (gain) loss on foreign exchange contracts	(1.7)		8.9		(11.1)		(0.4)		14.1
Unrealized foreign exchange (gain) loss	(10.8)		3.8		1.3		(5.9)		(12.1)
Non-recurring charges recognized in operating expense(1)	0.4		1.7		—		2.1		—
Transaction costs	0.5		—		3.2		2.4		5.8
Share of net (income) loss on investment in associate	(8.3)		5.3		3.1		(0.7)		5.4
Other expense (income)(2)	16.8		12.6		(3.1)		(328.4)		5.9
Unrealized foreign exchange (gain) loss recognized in deferred tax expense	(2.7)		(4.5)		(18.5)		(15.8)		(2.5)
Adjusted net income	$	72.2	$	9.2	$	38.9	$	70.3	$	88.4
Adjusted income per share - basic ($/share)	$0.24		$0.03		$0.16		$0.25		$0.42
Adjusted income per share - diluted ($/share)	$0.21		$0.03		$0.13		$0.21		$0.40

(1)Non-recurring charges recognized in operating expense relates to an impairment charge on replacement parts at Mesquite.

Net debt

The Company believes that in addition to conventional measures prepared in accordance with IFRS, the Company and certain investors and analysts use net debt to evaluate the Company’s performance. Net debt does not have any standardized meaning prescribed under IFRS, and therefore it may not be comparable to similar measures employed by other companies. This measure is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performances prepared in accordance with IFRS. Net debt is calculated as the sum of the current and non-current portions of long-term debt, net of the cash and cash equivalent balance as at the balance sheet date. A reconciliation of net debt is provided below.


	December 31, 2021		September 30, 2021		December 31, 2020
Current portion of loans and borrowings	$	26.7	$	26.7	$	13.3
Non-current portion of loans and borrowings	514.0		518.4		531.9
Total debt	540.7		545.1		545.2
Less: Cash and cash equivalents (unrestricted)	(305.5)		(300.3)		(344.9)
Net debt	$	235.2	$	244.8	$	200.3


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


RISKS AND UNCERTAINTIES

Financial instrument risk exposure

The Company is exposed in varying degrees to a variety of financial instrument related risks including credit risk, liquidity risk and market risk. The Company's Board of Directors approves and oversees the Company's risk management process which seeks to minimize the potential adverse effects of financial risks on the Company's financial results. At December 31, 2021, the financial risks to which the Company is exposed and the Company's objectives, policies and processes for managing those risks are as follows:

(a)Credit risk

Credit risk is the risk of financial loss to the Company if a counterparty to a financial instrument fails to meet its contractual obligations.

The Company limits its exposure to credit risk on its cash and cash equivalents and restricted cash by investing in high credit quality instruments and maintaining its cash balances in financial institutions with strong credit ratings. Credit risk arising from the Company's trade receivables is low with negligible expected credit losses as the Company sells its products to large global financial institutions and other companies with high credit ratings. Credit risk relating to receivables from the sale of the Company's non-core assets is mitigated by collateral held as security in the event of default.

(b)Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company's objective in managing its liquidity risk is to ensure there is sufficient capital to meet its short term business requirements after taking into account the Company's holdings of cash and cash equivalents. The Company manages its liquidity risk through a rigorous planning, budgeting and forecasting process to help determine the funding requirements to support its current operations, development and expansion plans. The Company also manages its liquidity risk by managing its capital structure.

(c)Market risk

(i)Interest rate risk

Interest rate risk is the risk that the fair values or future cash flows of the Company's financial instruments will fluctuate because of changes in market interest rates.

The Company is exposed to interest rate cash flow risk on its Revolving Facility and Term Loan which are subject to variable interest rates based on LIBOR or another alternate benchmark rate when the current benchmark rate ceases to exist. A 1.0% increase or decrease in the LIBOR interest rate during the year ended December 31, 2021 would have resulted in a decrease or increase of $2.2 million, respectively, in the Company's net income during the year ended December 31, 2021.

The Company is also exposed to interest rate cash flow risk on its cash and cash equivalents and restricted cash that earn variable interest.

The Company is exposed to interest rate fair value risk on the 2019 Notes and 2020 Notes which are subject to fixed interest rates. The Company manages its interest rate risk with a mix of fixed and variable rate debt. A change in market interest rate would impact the fair values of the 2019 Notes and 2020 Notes. However, as the Convertible Notes are measured at amortized cost, changes in market interest rates would have had no impact to the Company's net income during the year ended December 31, 2021.

(ii)Foreign currency risk

Currency risk is the risk that the fair values or future cash flows of the Company's financial instruments, in functional currency terms, will fluctuate because of changes in foreign exchange rates. Except for Greenstone which uses the Canadian dollar as its functional currency, the functional currency of the Company, and its subsidiaries is the US dollar. The Company and its subsidiaries are exposed to currency risk on transactions, investments and balances denominated in currencies other than USD, principally on BRL, MXN, and CAD expenses.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


RISKS AND UNCERTAINTIES (CONTINUED)

During the year ended December 31, 2021, Greenstone did not have material transactions or balances denominated in any currency other than the Canadian dollar, from which it would be exposed to currency risk.

The following tables summarize the Company's exposure to currency risk arising from financial assets and financial liabilities, excluding foreign exchange contracts denominated in foreign currencies:


At December 31, 2021	BRL		MXN		CAD
Financial assets	$	19,219	$	558	$	415,234
Financial liabilities	(54,594)		(50,250)		(46,674)
	$	(35,375)	$	(49,692)	$	368,560
At December 31, 2020
Financial assets	$	73,236	$	9,889	$	13,254
Financial liabilities	(61,896)		(5,952)		(7,671)
	$	11,340	$	3,937	$	5,583


	2021
BRL – 20%	$	5,165
MXN – 10%	3,628
CAD – 10%	(26,905)

In accordance with its foreign currency exchange risk management program, the Company uses foreign exchange contracts to manage its exposure to currency risk on expenditures in BRL and MXN which are accounted for as derivative financial instruments. At December 31, 2021, a 20% and 10% weakening in the BRL and MXN against the USD would have resulted in a decrease of $1.5 million in the fair value of the foreign currency derivative liabilities and increase in Company's net income during the year ended December 31, 2021. A 20% and 10% strengthening in the BRL and MXN against the USD would have resulted in an increase of $2.3 million in the fair value of the foreign currency derivative liabilities and decrease in the Company net income during the year ended December 31, 2021.

The Brazilian Real and Mexican Peso have experienced frequent and substantial variations in relation to the US dollar and other foreign currencies during the last decades. Depreciation of the BRL and MXN against the US dollar could create inflationary pressures in Brazil and Mexico and cause increases in interest rates, which could negatively affect the growth of the Brazilian and Mexican economy as a whole and harm the Company's financial condition and results of operations. On the other hand, appreciation of the BRL and MXN relative to the US dollar and other foreign currencies could lead to a deterioration of the Brazilian and Mexican foreign exchange current accounts, as well as dampen export-driven growth. Depending on the circumstances, either depreciation or appreciation of the BRL or MXN could have an adverse effect on the respective country’s economy.

(iii)Other price risk

The profitability of the Company is directly related to the market price for gold. A decline in the market price for gold could negatively impact the Company’s future operations. Gold prices are affected by various forces beyond Equinox Gold’s control, including global supply and demand, interest rates, exchange rates, inflation or deflation and the political and economic conditions of major gold producing countries. The price of gold has fluctuated widely in recent years, and future price declines could cause continuous development of, and commercial production from, Equinox Gold’s properties to be uneconomic. Future production from Equinox Gold’s mining properties is dependent on gold prices that are adequate to make these properties economically viable.

As part of the Leagold Acquisition, the Company assumed gold collar contracts with put and call strike prices of $1,325 and $1,425 per ounce, respectively, for 3,750 ounces per month to September 2022. The Company also assumed forward contracts with an average fixed gold price of $1,350 per ounce for 4,583 ounces per month to September 2022. At December 31, 2021, the Company had 33,750 ounces and 41,250 ounces remaining to be delivered under its gold collar and forward contracts, respectively.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


RISKS AND UNCERTAINTIES (CONTINUED)

In connection with the acquisition of an additional 10% interest in Greenstone, the Company assumed a contingent obligation for future gold deliveries. These contracts are measured at fair value through profit or loss at the end of each reporting period. A 10% increase or decrease in the price of gold at December 31, 2021 would have resulted in a decrease or increase of $10.5 million in the Company's net income for the year ended December 31, 2021.

Other risk factors

Equinox Gold’s business activities are subject to significant risks any of which could have a material adverse effect on Equinox Gold, its business and prospects, and could cause actual events to differ materially from those described in forward-looking statements related to Equinox Gold. The risks identified in this MD&A are in addition to those discussed in technical reports and other documents, including the Company’s 2021 Annual Information Form, filed by Equinox Gold from time to time on SEDAR and on EDGAR. In addition, other risks and uncertainties not presently known by management of Equinox Gold or that management currently believes are immaterial could affect Equinox Gold, its business and prospects.

Community action

Communities and non-governmental organizations (“NGOs”) are increasingly vocal and active with respect to mining activities at or near their communities. It is possible that a community or NGO could take actions that could have an adverse effect on the Company’s operations and reputation, such as establishing blockades that prevent access to the Company’s operations or restrict the delivery of supplies and personnel, and commencing lawsuits. In certain circumstances, such actions could ultimately result in the cessation of mining activities and the revocation of permits and licenses. Mining activities at the Los Filos mine were disrupted in 2020 and 2021 as a result of community blockades and the Company has had disruptions at its Brazilian operations, including at Aurizona.

Equinox Gold has initiated various programs to enhance its community engagement processes, ensure the Company continues to achieve industry standard environmental practices and to reinforce the Company’s commitment to the safety and health of its workforce and surrounding communities. There is no assurance, however, that these efforts will be successful at mitigating all impacts of community actions to the Company’s operations, and the Company may suffer material negative consequences to its business.

COVID-19

COVID-19 was declared a global pandemic by the World Health Organization on March 11, 2020. Since then, COVID-19 has had, and will continue to have, a negative impact on global financial conditions. Almost all countries globally are experiencing restrictions and negative impacts as the result of COVID-19, including Canada, the U.S.A., Mexico, and Brazil where the Company operates and has offices. A sustained slowdown in economic growth could have an adverse effect on the price and/or demand for gold. Further, as the prevalence of COVID-19 continues, governments continue to implement regulations and restrictions regarding the flow of labour, services and products. Consequently, the Company’s operations, including through limited availability of labour, suppliers, customers and distribution channels, could be impacted.

The Company is actively monitoring the evolution of the pandemic. Each of the Company’s operations implemented early preventive measures in collaboration with the Company’s employees, contractors and host communities to limit COVID-19 exposure and transmission. The Company continues to enforce stringent operational and safety procedures in accordance with guidelines outlined by the World Health Organization, the United States and Canada Centres for Disease Control and the local, state and federal governments at each of its sites.

The Company continues supporting preventive measures and vaccination campaigns conducted by local authorities.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


RISKS AND UNCERTAINTIES (CONTINUED)

Production and cost estimates

Equinox Gold prepares estimates of operating costs and/or capital costs for each operation and project. Equinox Gold’s actual costs may vary from estimates. Equinox Gold’s actual costs are dependent on several factors, including, but not limited to:

•the exchange rate between the United States dollar, Mexican Peso, Brazilian Real and the Canadian dollar;

•the price of gold and by-product metals;

•smelting and refining charges;

•royalties;

•the timing and cost of construction and maintenance activities at processing facilities;

•the availability and costs of skilled labour and specialized equipment;

•the availability and cost of appropriate processing and refining arrangements;

•potential increases in operating costs due to changes in the cost of fuel, power, materials and other inputs used in mining operations; and

•production levels.

Forecasts of future production are estimates based on interpretation and assumptions, and actual production may be less than estimated. Unless otherwise noted, Equinox Gold’s production forecasts are based on full production being achieved. Equinox Gold’s ability to achieve and maintain full production rates is subject to a number of risks and uncertainties, including the accuracy of Mineral Reserve and Mineral Resource estimates, the accuracy of assumptions regarding ore grades and recovery rates, ground conditions, physical characteristics of ores, the accuracy of estimated rates and costs of mining and processing, and the receipt and maintenance of permits.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


RISKS AND UNCERTAINTIES (CONTINUED)

Operational risks

Equinox Gold’s principal business is the mining, processing of and exploration for precious metals. Equinox Gold’s mining operations and processing and related infrastructure facilities are subject to risks normally encountered in the mining and metals industry. Although adequate precautions to minimize risk will be taken, operations are subject to hazards that could have an adverse effect on the business, results of operations and financial position of Equinox Gold.

Such risks include, without limitation, environmental hazards, tailings risks, industrial accidents, labour disputes, changes in laws, technical difficulties or failures, late delivery of supplies or equipment, unusual or unexpected geological formations or pressures, cave-ins, pit-wall failures, rock falls, unanticipated ground conditions, ore grade variations or water conditions (underground or at surface), climate change related events such as flooding and droughts, actual ore mined varying from estimates of grade or tonnage, metallurgical or other characteristics, interruptions in or shortages of electrical power or water, periodic or extended interruptions due to the unavailability of materials and force majeure events.

Additionally, Equinox Gold’s operations are subject to seasonal conditions. As a result of potentially heavy rainfall, pit access and the ability to mine ore may be lower during certain times of the year and may increase the cost of mining. In addition, a prolonged dry season may result in drought conditions, which may also impact production due to insufficient water for processing.

Such risks could result in reduced production, damage to, or destruction of, mineral properties or producing facilities, damage to or loss of life or property, environmental damage, delays in mining or processing, losses and possible legal liability.

Climate change

Climate change may exacerbate or create new operational risks for the Company. Governments are moving to introduce climate change legislation and treaties at the international, national, state/province and local levels. Regulations relating to emission levels (such as carbon taxes or cap and trade schemes) and energy efficiency is becoming more stringent. If the current regulatory trend continues, Equinox Gold expects that this may result in increased costs. In addition, physical risk of climate change may also have an adverse effect on Equinox Gold’s business and may impact our operations and financial position. These risks include: sea level rise, extreme weather events, impact on water availability and resource shortages due to delivery disruptions.

During 2021 the Company performed a climate modelling exercise to identify potential climate change risks specific to our operations to assist in us in mitigating such risks going forward. However, Equinox Gold cannot provide complete assurance that efforts to mitigate the risks of climate changes at all sites or that actions will be effective and that the physical risks of climate change will not have an adverse effect on the Company’s business, results of operations and financial position.

Construction risks

Construction costs and timelines can be impacted by a wide variety of factors, many of which are beyond the control of Equinox Gold. These include, but are not limited to, inflation, COVID-19, weather conditions, ground conditions, availability of appropriate rock and other material required for construction, availability and performance of contractors and suppliers, delivery and installation of equipment, design changes, accuracy of construction quantities and cost estimates and social acceptance by communities. Project development schedules are also dependent on obtaining and maintaining governmental approvals and the timeline to obtain such approvals is often beyond the control of Equinox Gold. A delay in start-up of commercial production would increase capital costs and delay generating revenues. Given the inherent risks and uncertainties associated with construction, there can be no assurance that a construction project will continue in accordance with current expectations or at all, that construction costs will be consistent with the budget, that production will be achieved on schedule, or that the mine will operate as planned.

Equinox Gold commenced construction of Santa Luz in 2020 with commissioning and production ramp up planned for Q1 2022. Mining and processing operations face various risks during commissioning and ramp up which could impact and/or delay achieving steady state production which would increase capital costs and delay generating revenues. There can be no assurance that production will be achieved on schedule or that the mine will operate as planned.

Equinox Gold commenced construction of Greenstone in 2021. The capital expenditures and time required to construct Greenstone are considerable and changes in costs and/or construction schedules could significantly increase both the time and capital required to build the project.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


RISKS AND UNCERTAINTIES (CONTINUED)

Construction costs and timelines can be impacted by a wide variety of factors, many of which are beyond the control of Equinox Gold. These include, but are not limited to, inflation, COVID-19, weather conditions, ground conditions, availability of appropriate rock and other material required for construction, availability and performance of contractors and suppliers, delivery and installation of equipment, design changes, accuracy of construction quantities and cost estimates and social acceptance by communities.. Project development schedules are also dependent on obtaining and maintaining governmental approvals and the timeline to obtain such approvals is often beyond the control of Equinox Gold. A delay in start-up of commercial production would increase capital costs and delay generating revenues. Given the inherent risks and uncertainties associated with construction, there can be no assurance that the construction will continue in accordance with current expectations or at all, that construction costs will be consistent with the budget, that production will be achieved on schedule, or that the mine will operate as planned.

Property commitments

The properties held by Equinox Gold may be subject to various land payments, royalties and/or work commitments. Failure by Equinox Gold to meet its payment obligations or otherwise fulfill its commitments under these agreements could result in the loss of related property interests.

In Mexico, while mineral rights are administered by the federal government through federally issued mining concessions, surface rights over the land located in the mining concessions may be owned by third parties, including an Ejido (communally held land). The Company has secured the surface rights necessary to operate Los Filos through written agreements with Ejidos, individual members of the Ejidos and private owners. However, these agreements are subject to renegotiation, especially with respect to the payments made by the Company to operate on such lands. Absence of agreement on such payment amount during a renegotiation of such written agreements may have significant impacts on the operation of Los Filos and could result in delays and higher costs to the Company to conduct its operation.

With respect to Los Filos, various land access agreements have been entered into with the main local communities whose properties include the areas occupying Los Filos mine operations and will be renegotiated in 2025. Pursuant to a social collaboration agreement Equinox Gold provides benefits to local communities such as the improvement of communal infrastructure or spending in educational and social support. The Company occasionally receives additional requests and complaints from the local communities relating to such commitments. The Company’s failure to answer adequately to the communities’ additional requests or complaints or failure to renegotiate the terms and conditions of the agreements may result in manifestations such as protests, roadblocks, or other forms of public expression against Equinox Gold’s activities and may have a negative impact on Equinox Gold’s reputation and operations.

Foreign operations

Equinox Gold conducts mining, development, exploration and other activities through subsidiaries in foreign countries, including the United States, Mexico and Brazil. Mining activities are subject to the risks normally associated with any conduct of business in foreign countries including:

•expropriation, nationalization, and the cancellation, revocation, renegotiation, or forced modification of existing contracts, permits, licenses, approvals, or title, particularly without adequate compensation;

•changing political and fiscal regimes, and economic and regulatory instability;

•unanticipated adverse changes to laws and policies, including those relating to mineral title, royalties and taxation and difficulty with understanding and complying with the same;

•delays or inability to obtain or maintain necessary permits, licenses or approvals;

•opposition to mine projects, which include the potential for violence, property damage and frivolous or vexatious claims;

•restrictions on foreign investment;

•unreliable or undeveloped infrastructure;

•labour unrest and scarcity;

•difficulty obtaining key equipment and components for equipment;

•regulations and restrictions with respect to imports and exports;

•high rates of inflation;

•extreme fluctuations in currency exchange rates and restrictions on foreign exchange, currencies and repatriation;

•inability to obtain fair dispute resolution or judicial determinations because of bias, corruption or abuse of power;


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


RISKS AND UNCERTAINTIES (CONTINUED)

•abuse of power of foreign governments who impose, or threaten to impose, fines, penalties or other similar mechanisms, without regard to the rule of law;

•difficulty understanding and complying with the regulatory and legal framework with respect to mineral properties, mines and mining operations, and permitting;

•violence and the prevalence of criminal activity, including organized crime, theft and illegal mining;

•civil unrest, terrorism and hostage taking;

•military repression and increased likelihood of international conflicts or aggression;

•restriction on the movements of personnel and supplies as the result of COVID-19; and

•increased public health concerns.

Criminal activity in Mexico, including violence between the drug cartels and authorities, and incidents of violent crime, theft, kidnapping for ransom and extortion by organized crime have increased over time. Although Equinox Gold has implemented measures to protect its employees, contractors, property and production facilities from these security risks, there can be no assurance that security incidents will not have an adverse effect on the Company’s operations.

The Brazilian government has a history of economic interventionism that can give risk to uncertainty. Changes, if any, in mining or investment policies or laws or shifts in political attitude in Brazil or any of the jurisdictions in which the Company operates may adversely affect the Company's operations or profitability. Operations may be affected in varying degrees by government regulations with respect to, but not limited to, restrictions on production, price controls, export controls, currency remittance, importation of parts and supplies, income and other taxes, expropriation of property, foreign investment, maintenance of claims, environmental legislation, land use, land claims of local people, water use and mine safety.

Uncertainty over whether the Brazilian government will implement changes in policy or regulation may contribute to economic uncertainty in Brazil. Historically, Brazilian politics have affected the performance of the Brazilian economy. Past political crises have affected the confidence of investors and the public, generally resulting in an economic slowdown. In the past, high levels of inflation have adversely affected the economies and financial markets of Brazil, and the ability of its government to create conditions that stimulate or maintain economic growth. Moreover, governmental measures to curb inflation and speculation about possible future governmental measures have contributed to the negative economic impact of inflation in Brazil and have created general economic uncertainty. As part of these measures, the Brazilian government has at times maintained a restrictive monetary policy and high interest rates that have limited the availability of credit and economic growth.

Environmental risks, regulations, and hazards

All phases of Equinox Gold’s mining operations are subject to environmental regulation in the jurisdictions in which they operate. These regulations mandate, among other things, the maintenance of air and water quality standards and land reclamation. They also set out limitations on the generation, transportation, storage and disposal of solid and hazardous waste. Environmental legislation is evolving in a manner which will likely, in the future, require stricter standards and enforcement, increased fines and penalties for non-compliance, more stringent environmental assessments of proposed projects and heightened degree of responsibility for companies and their officers, directors and employees. There is no assurance that future changes in environmental regulation, if any, will not adversely affect the mining operations. Environmental hazards may exist on the properties which are unknown at present which have been caused by previous or existing owners or operators of the properties. Equinox Gold may become liable for such environmental hazards caused by previous owners or operators of the properties.

Failure to comply with applicable laws, regulations and permitting requirements may result in enforcement actions thereunder, including fines and orders issued by regulatory or judicial authorities causing operations to cease or be curtailed, and may include corrective measures requiring capital expenditures, installation of additional equipment or remedial actions. Parties engaged in mining operations or in the exploration or development of mineral properties may be required to compensate those suffering loss or damage by reason of the mining activities and may have civil or criminal fines or penalties imposed for violations of applicable laws or regulations.

Previous mining by artisanal miners (Garimpeiros) has occurred and continues today at certain of Equinox Gold’s Brazilian properties. Garimpeiros are known to use chemicals to extract gold in their mining processes, which can result in environmental damage. While Equinox Gold has taken steps to address the activities of the Garimpeiros and the related environmental impacts, the Company cannot enforce the rule of law and therefore there is no certainty that such activities will be discontinued and Equinox Gold may become liable for such environmental hazards caused by previous owners or operators of the properties.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


RISKS AND UNCERTAINTIES (CONTINUED)

In February 2022 the Mexican Supreme Court issued a draft decision ordering the cancellation of two mineral claims previously issued to a mining company on the basis that free, prior and informed consultation with indigenous peoples was not conducted by the Government before the relevant mineral claims were issued. The Court indicated that the relevant mineral claims may be reissued once the required consultations are complete. The draft decision increases the risk of other communities seeking similar injunctions in the future. The final decision of the Court is expected later in 2022.

The extraction process for gold and metals can produce tailings, which are the slurry and sand-like materials that remain from the extraction process. Tailings are stored in engineered facilities that are designed, constructed, operated and closed in conformance with federal and state requirements and standard industry practices. Hazards such as uncontrolled seepage or geotechnical failure of retaining dams around tailings disposal areas, however, may result in environmental pollution and consequent liability.

Equinox Gold’s historical operations have generated chemical and metals depositions in the form of tailing ponds, rock waste dumps, and heap leach pads. The Company’s ability to obtain, maintain and renew permits and approvals and to successfully develop and operate mines may be adversely affected by real or perceived impacts associated with Equinox Gold’s activities or of other mining companies that affect the environment, human health and safety.

The water collection, treatment and disposal operations at Equinox Gold’s mines are subject to strict regulation and involve significant environmental risks if not carried out correctly. If collection or management systems fail, overflow or do not operate properly, untreated water or other contaminants could discharge into nearby properties or into nearby streams and rivers, causing damage to persons or property, or to aquatic life and economic damages. Liabilities resulting from damage, regulatory orders or demands, revoking of licenses or permits, or similar, could adversely affect Equinox Gold’s business, results of operations and financial condition due to partial or complete shutdown of operations. Moreover, in the event that Equinox Gold is deemed liable for any damage caused by overflow, Equinox Gold’s losses or consequences of regulatory action might not be covered by insurance policies.

Government regulation

The operating, development and exploration activities of Equinox Gold are subject to various laws governing prospecting, development, production, exports, imports, taxes, labour standards and occupational health and safety, mine safety, toxic substances, waste disposal, environmental protection and remediation, protection of endangered and protected species, land use, water use, land claims of local people and other matters. Externally driven regulation changes in the countries in which we operate adds uncertainties that cannot be accurately predicted. Any future adverse changes in government policies or legislation in the jurisdictions in which the Company operates are outside the Company’s control.

Any changes in government policy may result in changes to laws affecting ownership of assets, mining policies, monetary policies, taxation, royalty rates, exchange rates, environmental regulations, labour relations and return of capital. This may affect both Equinox Gold’s ability to undertake operating, development and exploration activities in respect of present and future properties in the manner currently contemplated, as well as its ability to continue to explore, develop and operate those properties in which it has an interest or in respect of which it has obtained exploration and development rights to date. The possibility that future governments may adopt substantially different policies, which might extend to expropriation of assets, cannot be ruled out.

No assurance can be given that new rules and regulations will not be enacted or that existing rules and regulations will not be interpreted in a manner which could have an adverse effect on Equinox Gold and its business, results of operations and financial position. Amendments to current laws, regulations and permits governing operating, development and exploration activities, or more stringent or different implementation, could have an adverse impact on Equinox Gold, or could require abandonment or delays in the development of new mining properties. Failure to comply with any applicable laws, regulations or permitting requirements may result in enforcement actions against Equinox Gold, including significant fines or orders issued by regulatory or judicial authorities causing process, development or exploration activities to cease or be curtailed or suspended, and may include corrective measures requiring capital expenditures, installation of additional equipment or remedial actions.

Taxation risk

Equinox Gold is subject to taxes, duties, levies, government royalties and other government-imposed compliance costs in several jurisdictions. New taxes or increases to the rates of taxation could have an adverse impact on the results of operations or the Company’s finances.

The Company has organized its operations in part based on its understanding and assumptions in relation to various tax laws (including but not limited to capital gains, withholding tax, transfer pricing) within the jurisdictions in which the Company operates. The Company believes that its understanding and assumptions are reasonable. However, the Company cannot provide assurance that foreign taxation or other authorities will reach the same conclusion. The results of audit of prior tax filings may have a material impact on Equinox Gold.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


RISKS AND UNCERTAINTIES (CONTINUED)

Equinox Gold is currently appealing federal and municipal value-added tax (“VAT”) assessments in Brazil. While Equinox Gold is confident that long-term regular recovery of VAT or other amounts receivable from various governmental and nongovernmental counterparties will be established, Equinox Gold cannot assure investors that such taxes will be recovered or that its activities will result in profitable processing operations.

Uncertainty of Mineral Reserve and Mineral Resource estimates

The Mineral Reserves and Mineral Resources published by Equinox Gold are estimates only and no assurance can be given that the anticipated tonnages and grades will be achieved, that the indicated level of recovery will be realized or that Mineral Reserves could be mined or processed profitably. There are numerous uncertainties inherent in estimating Mineral Reserves and Mineral Resources, including many factors beyond Equinox Gold’s control. Such estimation is a subjective process, and the accuracy of any Mineral Reserve or Mineral Resource estimate is a function of the quantity and quality of available data and of the assumptions made and judgments used in engineering and geological interpretation. Short-term operating factors relating to the Mineral Reserves, such as the need for orderly development of the ore bodies or the processing of new or different ore grades, may cause the mining operation to be unprofitable in any particular accounting period. In addition, there can be no assurance that metal recoveries in small scale laboratory tests will be duplicated in larger scale tests under on-site conditions or during production.

Fluctuation in commodities prices, results of drilling, metallurgical testing and production and the evaluation of mine plans subsequent to the date of any estimate may require revision of such estimate. Any material reductions in estimates of Mineral Reserves and Mineral Resources, or of Equinox Gold’s ability to extract these Mineral Reserves, could have an adverse effect on Equinox Gold and its business, results of operations and financial position. Inferred Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability and have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. A significant amount of exploration work must be completed in order to determine whether an Inferred Mineral Resource may be upgraded to a higher category.

Permitting

Equinox Gold’s operating, development and exploration activities are subject to receiving and maintaining licenses, permits and approvals (collectively, permits) from appropriate governmental authorities. Before commencing any operations, development or exploration on any of its properties, Equinox Gold must receive numerous permits. As the timing of receiving permits can vary and is largely out of the Company’s control, Equinox Gold may be unable to obtain on a timely basis or maintain in the future all necessary permits to explore and develop its properties, commence construction or operation of mining facilities and properties or maintain continued operations. Delays may occur in connection with obtaining necessary renewals of permits for Equinox Gold’s existing operations and activities, additional permits for existing or future operations or activities, or additional permits associated with new legislation. It is possible that previously issued permits may become suspended or revoked for a variety of reasons, including through change in government regulation or court action. Equinox Gold can provide no assurance that it will continue to hold or obtain, if required to, all permits necessary to develop or continue operating at any particular site, which could adversely affect its operations. Operation, development and exploration of Equinox Gold’s properties require permits from various governmental authorities in the Canada, United States, Mexico and Brazil, respectively. There can be no assurance that all future permits that Equinox Gold requires will be obtainable or renewable on reasonable terms, or at all. Delays or a failure to obtain required permits, or the expiry, revocation or failure to comply with the terms of any such permits that Equinox Gold has already obtained, would adversely affect its business.

Castle Mountain – Phase 2 Permitting

There can be no certainty that all necessary licenses and permits required to carry out development of Phase 2 at Castle Mountain will be obtained as currently projected, or as development plans for the project evolve. The process for permitting applications is often complex and time‐consuming, requiring a significant amount of time and other resources. The duration and success of efforts to obtain permits are contingent upon many variables outside of the Company’s control. In addition, most major permitting authorizations are subject to appeals or administrative protests, resulting in the potential for litigation that could give rise to administrative reconsiderations or reversals of permitting decisions. Appeals and similar litigation processes can result in lengthy delays, with uncertain outcomes. Such issues could impact the expected development timelines at Castle Mountain and have a material adverse effect on the Company’s business.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


RISKS AND UNCERTAINTIES (CONTINUED)

Joint Ventures

The Company holds a 60% interest in Greenstone through a limited partnership with Orion, who holds the remaining 40% interest. As such, the development and operation of Greenstone is subject to the risks normally associated with the conduct of joint ventures which may include (i) disagreements between joint venture partners on how to develop and operate mines efficiently; (ii) that joint venture partners may at any time have economic or business interests or goals that are, or become, inconsistent with another joint venture partner's business interests or goals; (iii) an inability of joint venture partners to meet their obligations to the joint venture or third parties; (iv) the potential bankruptcy of a joint venture partner; (v) the possibility that a joint venture partner may not be able to sell its interest in the joint venture; or (vi) litigation arising between joint venture partners regarding joint venture matters. The existence or occurrence of one or more such events could have a material adverse impact on the Company’s profitability, future cash flows, earnings, results of operations and financial condition.

Debt and liquidity risk

Equinox Gold must generate sufficient internal cash flows and/or be able to utilize available financing sources to finance its growth and sustain capital requirements. If Equinox Gold does not realize satisfactory prices for the gold from its gold mining operations, it could be required to raise significant additional capital through the capital markets and/or incur significant borrowings to meet its capital requirements. These financing requirements could result in dilution to existing Equinox Gold Shareholders and could adversely affect its ability to access the capital markets in the future to meet any external financing requirements Equinox Gold might have. If there are significant delays in when the Company’s growth projects are completed and/or their capital costs were to be significantly higher than estimated, these events could have an adverse effect on Equinox Gold’s business, results of operations and financial position.

Although Equinox Gold secured a $670 million financing package concurrent with the Leagold Acquisition, there is no guarantee that additional funding will be available for further development of its projects. Further activities may depend on Equinox Gold’s ability to obtain financing through equity or debt financing and failure to obtain this financing may result in delay or indefinite postponement of its activities.

As of the date of this MD&A, Equinox Gold had aggregate consolidated principal indebtedness in the amount of $567 million (2020 – $581 million). Equinox Gold’s ability to make scheduled payments on its credit facility and any other indebtedness will depend on its financial condition and operating performance, which are subject to prevailing economic and competitive conditions and to certain financial, business, legislative, regulatory and other factors beyond its control. There is no guarantee that additional funding will be available for development of projects or to refinance existing corporate and project debt. There may be an inability to complete the investment on the proposed terms or at all due to delays in obtaining or inability to obtain consent of lenders or to execute intercreditor agreements or obtain required regulatory and exchange approvals.

Equinox Gold is exposed to interest rate risk on variable rate debt. Liquidity risk is the risk that Equinox Gold will not be able to meet its financial obligations as they become due, including, among others, debt repayments, interest payments and contractual commitments. If Equinox Gold’s cash flows and capital resources are insufficient to fund its debt service obligations, Equinox Gold could face substantial liquidity problems and could be forced to reduce or delay investments and capital expenditures or to dispose of material assets or operations, seek additional debt or equity capital or restructure or refinance Equinox Gold’s indebtedness, including indebtedness under the credit facility. Equinox Gold may not be able to effect any such alternative measures on commercially reasonable terms or at all and, even if successful, those alternatives may not allow Equinox Gold to meet its scheduled debt service obligations.

In addition, a breach of debt covenants to third parties, including the financial covenants under the credit facility or Equinox Gold’s other debt instruments from time to time could result in an event of default under the applicable indebtedness. Such a default may allow the lenders to impose default interest rates or accelerate the related debt, which may result in the acceleration of any other debt to which a cross acceleration or cross default provision applies. In the event a lender accelerates the repayment of Equinox Gold’s borrowings, Equinox Gold may not have sufficient assets to repay its indebtedness.

The credit facility and other debt instruments contain several covenants that impose significant operating and financial restrictions on Equinox Gold and may limit Equinox Gold’s ability to engage in acts that may be in its long-term best interest. In particular, the credit facility restricts Equinox Gold’s ability to dispose of assets to make dividends or distributions and to incur additional indebtedness and grant security interests or encumbrances. As a result of these restrictions, Equinox Gold may be limited in how it conducts its business, may be unable to raise additional debt or equity financing, or may be unable to compete effectively or to take advantage of new business opportunities, each of such restrictions may affect Equinox Gold’s ability to grow in accordance with its strategy.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


RISKS AND UNCERTAINTIES (CONTINUED)

Further, Equinox Gold’s maintenance of substantial levels of debt could adversely affect its financial condition and results of operations and could adversely affect its flexibility to take advantage of corporate opportunities. Substantial levels of indebtedness could have important consequences to Equinox Gold, including:

•limiting Equinox Gold’s ability to obtain additional financing to fund future working capital, capital expenditures, acquisitions or other general corporate requirements, or requiring Equinox Gold to make nonstrategic divestitures;

•requiring a substantial portion of Equinox Gold’s cash flows to be dedicated to debt service payments instead of other purposes, thereby reducing the amount of cash flows available for working capital, capital expenditures, acquisitions and other general corporate purposes;

•increasing Equinox Gold’s vulnerability to general adverse economic and industry conditions including the impact of COVID-19, that could affect the Company’s ability to operate its mines effectively, or at all;

•exposing Equinox Gold to the risk of increased interest rates for any borrowings at variable rates of interest;

•limiting Equinox Gold’s flexibility in planning for and reacting to changes in the industry in which it competes;

•placing Equinox Gold at a disadvantage compared to other, less leveraged competitors; and

•increasing Equinox Gold’s cost of borrowing.

Share price fluctuation

Securities markets have experienced a high degree of price and volume volatility, and the market price of securities of many companies have experienced wide fluctuations that have not necessarily been related to their operating performance, underlying asset values or prospects. There can be no assurance that these kinds of share price fluctuations or lack of liquidity will not occur in the future, and if they do occur, the Company does not know how severe the impact may be on Equinox Gold’s ability to raise additional funds through equity issues. If Equinox Gold is unable to generate such revenues or obtain such additional financing, any investment in Equinox Gold may be materially diminished in value or lost.

Water availability

Water availability is an operational risk for all mine sites. Our sites are situated in a variety of climactic zones, including arid and semi-arid, as well as areas with distinct seasonal wet and dry periods.

Access to water at Castle Mountain

Equinox Gold maintains water rights including two producing wells at the Castle Mountain mine and has sufficient water supply for processing purposes for Phase 1 operations. However, additional sources of ground water are required to expand throughput and gold production as contemplated in Phase 2. The Company has done extensive drilling to identify additional water sources for the Phase 2 expansion. Water sources with supply sufficient have been identified and the Company is in the process of applying for permits to extract the water. If Equinox Gold is unable to secure permits to extract the additional water supplies, it could prevent or limit the Company’s ability to conduct development activities and ultimately expand production at Castle Mountain.

Availability of sufficient water to support mining operations at RDM

RDM is situated in a semi-arid region of Brazil and is dependent on the annual rainy season for replenishment of the supply of water. Prolonged drought conditions in the region can contribute to lower-than-expected water recharge in water wells as well as lower-than-expected water accumulation in the water storage facility. The Company’s ability to obtain and secure alternate supplies of water at a reasonable cost depends on many factors, including: regional supply and demand, political and economic conditions, problems that affect local supplies, delivery and transportation, and relevant regulatory regimes.

Previous operators temporarily suspended RDM operations on an annual basis since the mine’s inception in 2014 due to continued regional drought conditions. In 2017, a water storage facility was built to allow for the capture and storage of rainwater and surface water runoff from a larger catchment area; however, insufficient water capture was realized, and operations continued to be temporarily suspended in 2018 and 2019. In 2020 and 2021, there was sufficient water captured within the water storage facility to allow RDM to achieve continued operations through the dry season. While the Company has sufficient water to support operations in 2022, there is no guarantee that the Company can secure an alternate source of water in the event of a future prolonged drought.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


RISKS AND UNCERTAINTIES (CONTINUED)

Availability of sufficient water to support mining operations at Santa Luz

Santa Luz is situated in a semi-arid region of Brazil and is dependent on the annual rainy season for replenishment of the supply of water.

Subsequent to Santa Luz’s shutdown in 2014, the previous operator began to pump water from the nearby Itapicurú River, the main drainage system in the area, and store it within the C1 open pit for future use. The Company is currently converting and expanding an existing tailings storage facility into a water storage facility to increase Santa Luz’s water storage capacity. In late 2021, the remaining water in the C1 pit was transferred to the new water storage facility and is available for use as process water as a mitigation measure should insufficient water be available to pump from the Itapicurú River throughout the operational life of the mine.

Availability of sufficient water storage capacity to support mining operations at Aurizona

Aurizona is situated in a tropical region of Brazil and receives significant amounts (over 3,000mm on average) of rainfall during the rainy season. Storage of water collected during the rainy season for use for the mineral processing plant throughout the dry season is constrained by the available storage capacity of the existing tailings storage facility.

The deposit of tailings into the TSF, combined with the necessary water storage requirements, has to be carefully managed as the water reservoir level must be reduced prior to the onset of the dry season to allow the tailings beach adjacent to the tailings embankment to become exposed and to sufficiently dry to allow for the next embankment raise to be constructed in a centreline configuration. The subsequent management of the remaining water within the TSF becomes critical to ensure there is enough water available for mineral processing needs for the duration of the dry season and prior to the onset of the subsequent rainy season that will recharge the water in the tailings reservoir.

To increase available storage capacity, a new open pit (Boa Esperanca) was fully mined and is now available as the primary source of water storage for the process plant. In addition, a new TSF is planned to receive all future tailings deposition by early 2023, which will allow the existing TSF to be available to provide some additional (emergency) storage of water over the longer term.

Acquisitions, business arrangements or transactions

Equinox Gold will continue to seek new mining and development opportunities in the mining industry as well as business arrangements or transactions. In pursuit of such opportunities, Equinox Gold may fail to select appropriate acquisition targets or negotiate acceptable arrangements, including arrangements to finance acquisitions or integrate the acquired businesses and their workforce into Equinox Gold. Ultimately, any acquisitions would be accompanied by risks, which could include change in commodity prices, difficulty with integration, failure to realize anticipated synergies, significant unknown liabilities, delays in regulatory approvals and exposure to litigation. There is no guarantee that the sources of financing that have been announced will be successful and that additional funding will be available for development of projects or to refinance existing corporate and project debt. There may be an inability to complete the investment on the proposed terms or at all due to delays in obtaining or inability to obtain consent of lenders or to execute intercreditor agreements or obtain required regulatory and exchange approvals. Any issues that Equinox Gold encounters in connection with an acquisition, business arrangement or transaction could have an adverse effect on its business, results of operations and financial position.

Equinox Gold entered into an agreement to sell Mercedes to Bear Creek in December 2021. While the transaction is expected to close around the end of Q1 2022, it remains subject to regulatory approvals and customary closing conditions and there is no guarantee that the sale will be successful as there are many factors which influence the outcome.

In April 2021 the Company completed the sale of Pilar to Pilar Gold. Pilar Gold subsequently requested extensions to payment date of the Third Installment and Equinox Gold agreed to extend the maturity of the Third Installment to November 30,2023. There is a risk that Pilar Gold will be unable to meet its obligations with respect to the Third Installment or that the Company will be unable to recover the Third Installment through exercise of its security.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


RISKS AND UNCERTAINTIES (CONTINUED)

Reclamation estimates, costs and obligations

Equinox Gold’s operations are subject to reclamation plans that establish its obligations to reclaim properties after minerals have been mined from a site. While closure costs are estimated using industry standard practices, often using third parties, it is difficult to determine the exact amounts which will be required to complete all land reclamation activities in connection with the properties in which Equinox Gold holds an interest. Reclamation bonds and other forms of financial assurance represent only a portion of the total amount of money that will be spent on reclamation activities over the life of a mine. Accordingly, these obligations represent significant future costs for Equinox Gold, and it may be necessary to revise planned expenditures, operating plans and reclamation concepts and plans in order to fund reclamation activities. Such increased costs may result in the underestimation of closure costs which may have an adverse impact upon the business, results or operations and financial position of Equinox Gold.

There is a potential future liability for cleanup of tailings deposited on the mining license areas by others during previous periods of mining and reprocessing. It is not possible to quantify at this time what the potential liability may be and detailed assessments need to be made to determine future land reclamation costs, if any.

Infrastructure

Mining, processing, development and exploration activities depend, to one degree or another, on adequate infrastructure. Reliable roads, bridges, power sources and water supply are important determinants which affect capital and operating costs. Unusual or infrequent weather phenomena, terrorism, sabotage, government, community or other interference in the maintenance or provision of such infrastructure could adversely affect Equinox Gold’s business, results of operations and financial position.

Aurizona has access to existing roads and paved highways as well as local water and power supply; however, the existing road to the village of Aurizona may require relocation in the future to allow access to the western portion of the ore body, which will also require permitting and community support.

Properties located in remote areas

Certain of Equinox Gold’s properties are located in remote areas, some of which have severe climates, resulting in technical challenges for conducting both geological exploration and mining. Equinox Gold benefits from modern mining transportation skills and technologies for operating in areas with severe climates. Nevertheless, Equinox Gold may sometimes be unable to overcome problems related to weather and climate at a commercially reasonable cost, which could have an adverse effect on Equinox Gold’s business, results of operations and financial position. The remote location of Equinox Gold’s operations may also result in increased costs and transportation difficulties.

Aurizona is situated in a region where other mining activity is developing. Aurizona has access to existing roads and paved highways as well as local water and power supply; however, the existing road to the village of Aurizona may require relocation in the future to allow access to the western portion of the ore body, which will also require permitting and community support. Generators currently act as back-up for power outages but, despite provision for backup infrastructure, there can be no assurance that challenges or interruptions in infrastructure and resources will not be encountered.

Internal controls over financial reporting

Equinox Gold may fail to maintain the adequacy of its internal controls over financial reporting as such standards are modified, supplemented or amended from time to time, and Equinox Gold cannot ensure that it will conclude on an ongoing basis that it has effective internal controls over financial reporting. Equinox Gold’s failure to satisfy the requirements of Canadian and United States legislation on an ongoing, timely basis could result in the loss of investor confidence in the reliability of its financial statements, which in turn could harm Equinox Gold’s business and negatively impact the trading price and market value of its shares or other securities. In addition, any failure to implement required new or improved controls, or difficulties encountered in their implementation, could harm Equinox Gold’s operating results or cause it to fail to meet its reporting obligations.

Equinox Gold may fail to maintain the adequacy of its disclosure controls. Disclosure controls and procedures are designed to ensure that the information required to be disclosed by Equinox Gold in reports filed with securities regulatory agencies is recorded, processed, summarized and reported on a timely basis and is accumulated and communicated to Equinox Gold’s management, as appropriate, to allow timely decisions regarding required disclosure.

No evaluation can provide complete assurance that Equinox Gold’s financial and disclosure controls will detect or uncover all failures of persons within Equinox Gold to disclose material information otherwise required to be reported. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance with respect to the reliability of financial reporting and financial statement preparation. The effectiveness of Equinox Gold’s controls and procedures could also be limited by simple errors or faulty judgements.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


RISKS AND UNCERTAINTIES (CONTINUED)

If the Company does not maintain adequate financial and management personnel, processes, and controls, it may not be able to accurately report its financial performance on a timely basis, which could cause a decline in Equinox Gold’s share price and harm its ability to raise capital. Failure to accurately report its financial performance on a timely basis could also jeopardize the Company’s continued listing on the TSX or NYSE American or any other exchange on which Equinox Gold’s common shares may be listed.

As described on page 62, a material weakness in the Company’s internal control over financial reporting was determined to exist as at December 31, 2020 associated with controls over the purchase price accounting related to the Leagold Transaction. The Company subsequently implemented a remediation plan and management concluded the actions taken to improve the design and operating effectiveness of its internal controls related to the purchase price accounting operated effectively and remediated the material weakness. Management concluded that the Company’s disclosure controls and procedures were effective as at December 31, 2021.

Information systems and Cybersecurity

Targeted attacks on Equinox Gold’s systems (or on systems of third parties that Equinox Gold relies on), failure or non-availability of key information technology (“IT”) systems or a breach of security measures designed to protect Equinox Gold’s IT systems could result in disruptions to Equinox Gold’s operations, personal injury, property damage or financial or reputational risks. Equinox Gold has engaged IT consultants to implement and test system controls and disaster recovery infrastructure for certain IT systems. As the threat landscape is ever-changing, Equinox Gold continuously implements mitigations, including risk prioritized controls to protect against known and emerging threats, adopts tools to provide automate monitoring and alerting, and installs backup and recovery systems to ensure the Company’s ability to restore systems and return to normal operations. There is no certainty that Equinox Gold’s efforts will adequately protect the Company’s systems and operations.

Counterparty risk

Counterparty risk is the risk to Equinox Gold that a party to a contract will default on its contractual obligations to Equinox Gold. Equinox Gold is exposed to various counterparty risks including, but not limited to: (i) financial institutions that hold Equinox Gold’s cash and short-term investments; (ii) companies that have payables to Equinox Gold; (iii) providers of its risk management services, such as hedging arrangements; (iv) shipping service providers that move Equinox Gold’s material; (iv) Equinox Gold’s insurance providers; and (v) Equinox Gold’s lenders. Although Equinox Gold makes efforts to limit its counterparty risk, Equinox Gold cannot effectively operate its business without relying, to a certain extent, on the performance of third-party service providers.

Public perception

Damage to Equinox Gold’s reputation can be the result of the actual or perceived occurrence of any number of events, and could include any negative publicity, whether true or not. Although Equinox Gold places great emphasis on protecting its image and reputation, it does not ultimately have direct control over how it is perceived by others. Reputation loss may lead to increased challenges in developing and maintaining community relations, decreased investor confidence and act as an impediment to Equinox Gold’s overall ability to operate mines or advance its projects, thereby having an adverse impact on financial performance, cash flows, growth prospects, and the market value of the Company’s share and other securities.

Equinox Gold may become subject to additional legal proceedings

Equinox Gold is currently subject to litigation and claims in Brazil, Mexico, the United States and Canada and may, from time to time, become involved in various claims, legal proceedings, regulatory investigations and complaints. Equinox Gold cannot reasonably predict the likelihood or outcome of any actions should they arise. If Equinox Gold is unable to resolve any such disputes favorably, it may have an adverse effect on Equinox Gold’s financial performance, cash flows, and results of operations. To the extent management believes it is probable that a material cash outflow will be incurred to settle the claim, a provision for the estimated settlement amount is recorded. Equinox Gold’s assets and properties may become subject to further liens, agreements, claims, or other charges as a result of such disputes. Any claim by a third party on or related to any of Equinox Gold’s properties, especially where Mineral Reserves have been located, could result in Equinox Gold losing a commercially viable property. Even if a claim is unsuccessful, it may potentially affect Equinox Gold’s operations due to the high costs of defending against the claim. If Equinox Gold loses a commercially viable property, such a loss could lower its future revenues, or cause Equinox Gold to cease operations if the property represents a significant portion of Equinox Gold’s Mineral Reserves.

Equinox Gold could be forced to compensate those suffering loss or damage by reason of its processing, development or exploration activities and could face civil or criminal fines or penalties imposed for violations of applicable laws or regulations. Any such regulatory or judicial action could materially increase Equinox Gold’s operating costs and delay or curtail or otherwise negatively impact Equinox Gold’s activities.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


RISKS AND UNCERTAINTIES (CONTINUED)

Defects in land title

Title insurance is not available for Equinox Gold’s properties, and Equinox Gold’s ability to ensure that it has obtained a secure claim to individual mineral properties or mining concessions may be severely constrained. Equinox Gold has not conducted surveys of all of the claims in which it holds direct or indirect interests and, therefore, the precise area and location of such claims may be in doubt. Equinox Gold can provide no assurances that there are no title defects affecting its properties. Accordingly, its mineral properties may be subject to prior unregistered liens, agreements, transfers or claims, including indigenous land claims, and title may be affected by, among other things, undetected defects. In addition, Equinox Gold may be unable to operate its properties as permitted or to enforce its rights with respect to its properties.

Management

The success of Equinox Gold will be largely dependent on the leadership performance of its management team and Board of Directors. The loss of the services of these persons would have an adverse effect on Equinox Gold’s business, results of operations, financial position and prospects. There is no assurance Equinox Gold can maintain the services of its Board of Directors and management or other qualified personnel required to operate its business. Failure to do so could have an adverse effect on Equinox Gold and its business, results of operations, financial position and growth prospects.

Employee recruitment and retention

Recruiting and retaining qualified personnel is critical to Equinox Gold’s success. The number of persons skilled in the acquisition, exploration, development and operation of mining properties is limited and competition for such persons is intense. In particular, there is intense competition for engineers, geologists and persons with mining expertise. As Equinox Gold’s business activity grows, it will require additional key financial, administrative, mining, marketing and public relations personnel as well as additional staff at its operations. Although Equinox Gold believes that it will be successful in attracting and retaining qualified personnel, there can be no assurance of such success as competition for such persons with these skill sets increases. If Equinox Gold is not successful in attracting and retaining qualified personnel, the efficiency of the Company’s operations could be impaired, which could have an adverse impact on Equinox Gold’s future cash flows, earnings, results of operations, and financial condition.

Competition

The mining industry is very competitive, particularly with respect to properties that produce, or are capable of producing, gold and other metals. Mines have limited lives and, as a result, Equinox Gold continually seeks to replace and expand Mineral Reserves through exploration and the acquisition of new properties. In addition, there is a limited supply of desirable mineral lands available in areas where Equinox Gold would consider conducting exploration and/or production activities. As Equinox Gold faces significant and increasing competition from other mining companies, some of which have greater financial and technical resources than Equinox Gold, for a limited number of suitable properties and resource acquisition opportunities, Equinox Gold may be unable to acquire such mining properties which it desires on terms it considers acceptable.

Equinox Gold competes with these other mining companies for the recruitment and retention of qualified directors, professional management, employees and contractors. Competition is also intense for the availability of drill rigs, mining equipment, and production equipment. Competition in the mining business for limited sources of capital could adversely impact our ability to acquire and develop suitable gold mines, gold developmental projects, gold producing companies, or properties having significant exploration potential. As a result, there can be no assurance that the Company’s acquisition and exploration programs will yield new Mineral Reserves to replace or expand current Mineral Reserves, or that the Company will be able to maintain production levels in the future.

Employee and labour relations

Some of Equinox Gold’s employees and contractors are unionized. Although the Company has reached agreements and places significant emphasis on maintaining positive relationships with the union and employees, there is risk of labour strikes and work stoppages. Should they occur, some labour strikes and work stoppages have the potential to significantly affect the Company’s operations and thereby adversely impact the Company’s future cash flows, earnings, production, and financial conditions.

Further, relations with employees may be affected by changes in the scheme of labour relations that may be introduced by the relevant governmental authorities in the jurisdictions in which the mining operations are conducted. Changes in such legislation or otherwise in Equinox Gold’s relationships with its employees may result in strikes, lockouts or other work stoppages, any of which could have an adverse effect on the business, results of operations and financial position.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


RISKS AND UNCERTAINTIES (CONTINUED)

Uninsurable risks

Equinox Gold is subject to a number of risks and hazards generally, including adverse environmental conditions, industrial accidents, labour disputes, unusual or unexpected geological conditions, ground or slope failures, mechanical failures, changes in the regulatory environment and natural phenomena such as inclement weather conditions, floods and earthquakes. Such occurrences could result in damage to mineral properties or production facilities, personal injury or death, environmental damage to Equinox Gold’s current properties and future properties of Equinox Gold or the properties of others, delays in mining, monetary losses and possible legal liability.

Equinox Gold maintains insurance to protect against certain risks in such amounts as it considers to be reasonable. However, Equinox Gold cannot provide any assurance that its insurance coverage will be sufficient to cover any resulting liability, or that such insurance will continue to be available at economically feasible premiums or for other reasons.

While Equinox Gold evaluates the risks to its business and carries insurance policies to mitigate the risk of loss where economically feasible, not all of these risks are reasonably insurable and insurance coverages may contain limits, deductibles, exclusions and endorsements. In particular, insurance against risks such as environmental pollution or other hazards as a result of exploration and production is not generally available to Equinox Gold or to other companies in the mining industry on acceptable terms. Losses from such events may have an adverse effect on Equinox Gold, its business, results of operations and financial position. Equinox Gold may also become subject to liability for pollution or other hazards which may not be insured against or which Equinox Gold may elect not to insure against because of premium costs or other reasons. Losses from these events may cause Equinox Gold to incur significant costs that could have an adverse effect upon its business, results of operations and financial position.

Speculative nature of mining exploration and development

The long-term operation and success of Equinox Gold is dependent, in part, on the cost and success of our exploration and development projects. Mineral exploration and development is highly speculative and involves significant risks. Major expenses are typically required to locate and establish Mineral Reserves.

Development of Equinox Gold’s mineral projects will only follow upon obtaining satisfactory results. Few properties which are explored are ultimately developed into producing properties. There is no assurance that Equinox Gold’s exploration and development activities will result in any discoveries of commercial bodies of ore which will be brought into commercial production.

The processes of exploration and development also involves risks and hazards, including environmental hazards, industrial accidents, labour disputes, unusual or unexpected geological conditions or acts of nature. These risks and hazards could lead to events or circumstances which could result in the complete loss of a project or could otherwise result in damage or impairment to, or destruction of, mineral properties and future production facilities, environmental damage, delays in exploration and development interruption, and could result in personal injury or death.

Corruption and bribery

Equinox Gold’s operations are governed by, and involve interactions with, many levels of government in numerous countries. Equinox Gold is required to comply with anti-corruption and anti-bribery laws, including but not limited to the Canadian Corruption of Foreign Public Officials Act, the United States Foreign Corrupt Practices Act, the Brazil Clean Company Act and the Mexico Criminal Code and Anti-Corruption in Public Contracts Act. In recent years, there has been a general increase in both the frequency of enforcement and the severity of penalties under such laws, resulting in greater scrutiny and punishment to companies convicted of violating anti-corruption and anti-bribery laws. Furthermore, a company may be found liable for violations by not only its employees, but also by its contractors and third-party agents. Although Equinox Gold has adopted steps to mitigate such risks, including the implementation of training programs, internal monitoring, reviews and audits, and policies to ensure compliance with such laws, such measures may not always be effective in ensuring that Equinox Gold, its employees, contractors or third-party agents will comply strictly with such laws. If Equinox Gold finds itself subject to an enforcement action or is found to be in violation of such laws, this may result in significant penalties, fines and/or sanctions imposed on Equinox Gold resulting in an adverse effect on Equinox Gold’s reputation and business.

Public company obligations

Equinox Gold’s business is subject to evolving corporate governance and public disclosure regulations that have increased both Equinox Gold’s compliance costs and the risk of non-compliance, which could adversely impact Equinox Gold’s share price.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


RISKS AND UNCERTAINTIES (CONTINUED)

Equinox Gold is subject to changing rules and regulations promulgated by a number of governmental and self-regulated organizations, including the Canadian and United States securities administrators and regulators, the TSX, the NYSE American, and the International Accounting Standards Board. These rules and regulations continue to evolve in scope and complexity creating many new requirements. Equinox Gold’s efforts to comply with such legislation could result in increased general and administration expenses and a diversion of management time and attention from revenue-generating activities to compliance activities.

No history of dividends

Equinox Gold has not, since the date of its incorporation, declared or paid any cash dividends on its Common Shares and does not currently have a policy with respect to the payment of dividends. The payment of dividends in the future will depend on the earnings, if any, and Equinox Gold’s financial condition and such other factors as the Board of Directors considers appropriate.

Significant shareholders

The Company has certain significant shareholders and holders of convertible notes, that have or will have on exercise of such convertible rights the ability to influence the outcome of corporate actions requiring shareholder approval, including the election of directors of Equinox Gold and the approval of certain corporate transactions. Although, each of these significant shareholders is or will be a strategic partner of Equinox Gold, their respective interests may differ from the interests of Equinox Gold or its other shareholders. The concentration of ownership of the shares may also have the effect of dissuading third-party offers or delaying or preventing other possible strategic transactions of Equinox Gold.

Conflicts of interest

Certain of the directors and/or officers of Equinox Gold also serve as directors and/or officers of other companies involved in natural resource exploration, development and mining operations and consequently there exists the possibility for such directors to be in a position of conflict. In particular, Ross Beaty, Chairman of Equinox Gold, is a significant Equinox Gold shareholder, and François Bellemare, a director of Equinox Gold, is also an employee of Mubadala which has a material relationship with Equinox Gold. Any decision made by any of such directors and/or officers will be made in accordance with their duties and obligations to deal fairly and in good faith with a view to the best interests of Equinox Gold and the Company’s shareholders. In addition, each director is required to declare and refrain from voting on any matter in which such director may have a conflict of interest in accordance with the procedures set forth in the British Columbia Business Corporations Act and other applicable laws.


ACCOUNTING MATTERS

Basis of preparation and accounting policies

The Company’s consolidated financial statements have been prepared in accordance with IFRS as issued by the International Accounting Standards Board (“IASB”). Details of the significant accounting policies for significant (or potentially significant) areas that have had an impact (or may have an impact in future periods) on the Company’s financial statements are disclosed in note 3 of the Company’s consolidated financial statements for the year ended December 31, 2021. The impact of future accounting changes is disclosed in note 3(w) to the Company’s consolidated financial statements.

Critical accounting estimates and judgments

In preparing the Company’s consolidated financial statements in conformity with IFRS, management has made judgements, estimates and assumptions that affect the application of the Company’s accounting policies and the reported amounts of assets, liabilities, income and expense. Actual results may differ. Critical accounting estimates represent estimates that are uncertain and for which changes in those estimates could materially impact the consolidated financial statements. All estimated and underlying assumptions are reviewed on an ongoing basis. Revisions are recognized in the period in which the estimates are revised and in any future periods affected. Areas of judgment and key sources of estimation uncertainty that have the most significant effect are disclosed in note 4 of the Company’s consolidated financial statements for the year ended December 31, 2021.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


INTERNAL CONTROLS OVER FINANCIAL REPORTING AND DISCLOSURE CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

Disclosure controls and procedures are designed to provide reasonable assurance that information required to be disclosed in reports filed or submitted by the Company under U.S. and Canadian securities legislation is recorded, processed, summarized and reported within the time periods specified in those rules, and include controls and procedures designed to ensure that information required to be disclosed in reports filed or submitted by the Company under U.S. and Canadian securities legislation is accumulated and communicated to management, including the CEO and CFO, as appropriate, to permit timely decisions regarding required disclosure.

Management, including the CEO and CFO, believe that any disclosure controls and procedures or internal controls over financial reporting, no matter how well conceived and operated can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, they cannot provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been prevented or detected. These inherent limitations include the realities that judgements in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by unauthorized override of the control. The design of any systems of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Accordingly, because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

Management, including the CEO and CFO, has evaluated the effectiveness of the design and operation of the Company’s disclosure controls and procedures, as defined in the rules of the U.S. Securities and Exchange Commission and the Canadian Securities Administrators, as at December 31, 2022. Based on this evaluation, the CEO and CFO have concluded that the Company’s disclosure controls and procedures were effective as at December 31, 2021.

Internal Controls over Financial Reporting

Management, with the participation of the CEO and CFO, is responsible for establishing and maintaining adequate internal control over financial reporting (“ICFR”) as defined in the rules of the United States Securities and Exchange Commission and the Canadian Securities Administrators. The Company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes in accordance with IFRS as issued by the IASB.

The Company’s ICFR includes policies and procedures that:

•accounting records are maintained that accurately and fairly reflect, in reasonable detail, the transactions and dispositions of assets of the Company;

•are designed to provide reasonable assurance that the Company’s receipts and expenditures are made in accordance with authorizations of management and the Company’s Directors; and

•are designed to provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on the Company’s consolidated financial statements.

The Company’s ICFR may not prevent or detect all misstatements because of inherent limitations. Additionally, projections of any evaluation of effectiveness for future periods are subject to the risk that controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with the Company’s policies and procedures.

Management assessed the effectiveness of the Company’s ICFR based on the criteria for effective internal control over financial reporting established in “Internal Control – Integrated Framework” issued by the Committee of Sponsoring Organizations (COSO) of the Treadway Commission (2013). Based on this assessment Management concluded that the Company’s internal controls over financial reporting were effective as of December 31, 2021.

KPMG LLP, an independent registered public accounting firm, has audited the effectiveness of internal control over financial reporting, and has expressed their opinion in their report included with the Company’s annual consolidated financial statements.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


INTERNAL CONTROLS OVER FINANCIAL REPORTING AND DISCLOSURE CONTROLS AND PROCEDURES (CONTINUED)

As previously reported in the Company’s MD&A for the year ended December 31, 2020, Management’s assessment of the effectiveness of the Company’s ICFR concluded that, as of December 31, 2020, the Company’s ICFR was not effective as a result of a material weakness associated with controls over the purchase price accounting related to the Leagold Acquisition. Specifically, the Company did not (i) identify and deploy control activities through policies that establish expectations and procedures that put policies into action, and (ii) internally communicate information, including objectives and responsibilities for internal control, necessary to support the function of internal control. As a result, there was inadequate control over the determination of the fair value of acquired assets and over the resulting deferred income tax liabilities recognized, as well as inadequate documentation over such controls. This control deficiency resulted in an immaterial misstatement, which was corrected in the Company’s audited consolidated financial statements prior to release but creates a reasonable possibility that a material misstatement in the annual or interim financial statements will not be prevented or detected on a timely basis.

To remediate the material weakness in the Company’s internal control over financial reporting, Management strengthened its controls over purchase price accounting by (i) allocating dedicated and specialised resources to document the policies and procedures around purchase price accounting, and (ii) internally communicating information necessary to support the function of internal control. These controls were applied to the purchase price accounting related to the Premier Transaction in 2021. Management have concluded the actions taken to improve the design and operating effectiveness of its internal controls related to the purchase price accounting operated effectively and remediated the material weakness.

Other than the implementation of the remediation plan described above, there have been no changes in the Company’s internal control over financial reporting during the period ended December 31, 2021 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

The Company assessed Premier’s disclosure controls and procedures and internal control over financial reporting; however, in accordance with National Instrument 52-109 - Certification of Disclosure in Issuer’s Annual and Interim Filings, because Premier was acquired not more than 365 days before the end of December 31, 2021, the Company has limited the scope of its design of disclosure controls and procedures and internal controls over financial reporting to exclude the controls, policies and procedures of Premier, except for purchase price adjustments related to the acquisition.

The table below presents the summary financial information included in the Company’s consolidated annual financial statements for the excluded controls related to the acquired business:


Premier Gold Mines Limited
Selected financial information from the statement of income (loss)			April 7 to
$ amounts in millions			December 31, 2021
Total revenues			56.9
Net loss			(0.1)

Selected financial information from the statement of financial position			As at December 31, 2021
Total current assets			181.7
Total non-current assets			274.7
Total current liabilities			(88.9)
Total non-current liabilities			(8.3)


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


CAUTIONARY NOTES AND FORWARD-LOOKING STATEMENTS

This MD&A contains certain forward-looking information and forward-looking statements within the meaning of applicable securities legislation and may include future-oriented financial information. Forward-looking statements and forward-looking information in this MD&A relate to, among other things: the strategic vision for the Company and expectations regarding exploration potential, production capabilities and future financial or operational performance; the Company’s ability to successfully advance its growth and development projects, including the construction of Santa Luz and Greenstone and the expansions at Los Filos, Aurizona and Castle Mountain; the expectations for the Company’s investments in Solaris, i-80 Gold and Pilar Gold; completion of the sale of the Mercedes mine; the duration, extent and other implications of the novel coronavirus (COVID-19); the Company’s production and cost guidance; and conversion of Mineral Resources to Mineral Reserves. Forward-looking statements or information generally identified by the use of the words “believe”, “will”, “advancing”, “strategy”, “plans”, “budget”, “anticipated”, “expected”, “estimated”, “on track”, “target”, “objective” and similar expressions and phrases or statements that certain actions, events or results “may”, “could”, or “should”, or the negative connotation of such terms, are intended to identify forward-looking statements and information. Although the Company believes that the expectations reflected in such forward-looking statements and information are reasonable, undue reliance should not be placed on forward-looking statements since the Company can give no assurance that such expectations will prove to be correct. The Company has based these forward-looking statements and information on the Company’s current expectations and projections about future events and these assumptions include: Equinox Gold’s ability to achieve the exploration, production, cost and development expectations for its respective operations and projects; prices for gold remaining as estimated; currency exchange rates remaining as estimated; construction of Santa Luz and Greenstone being completed and performed in accordance with current expectations; expansion projects at Los Filos, Castle Mountain and Aurizona being completed and performed in accordance with current expectations; tonnage of ore to be mined and processed; ore grades and recoveries; availability of funds for the Company’s projects and future cash requirements; capital, decommissioning and reclamation estimates; Mineral Reserve and Mineral Resource estimates and the assumptions on which they are based; prices for energy inputs, labour, materials, supplies and services; no labour-related disruptions and no unplanned delays or interruptions in scheduled construction, development and production, including by blockade or industrial action; the Company’s working history with the workers, unions and communities at Los Filos; all necessary permits, licenses and regulatory approvals are received in a timely manner; the Company’s ability to comply with environmental, health and safety laws; the strategic vision for i-80 Gold and its ability to successfully advance its projects; the strategic vision for Solaris Resources and its ability to successfully advance its projects; the exercise of the Solaris Resources warrants; and the ability of Pilar Gold to successfully operate the Pilar mine and to meet its payment commitments to the Company. While the Company considers these assumptions to be reasonable based on information currently available, they may prove to be incorrect. Accordingly, readers are cautioned not to put undue reliance on the forward-looking statements or information contained in this MD&A.

The Company cautions that forward-looking statements and information involve known and unknown risks, uncertainties and other factors that may cause actual results and developments to differ materially from those expressed or implied by such forward-looking statements and information contained in this MD&A and the Company has made assumptions and estimates based on or related to many of these factors. Such factors include, without limitation: fluctuations in gold prices; fluctuations in prices for energy inputs, labour, materials, supplies and services; fluctuations in currency markets; operational risks and hazards inherent with the business of mining (including environmental accidents and hazards, industrial accidents, equipment breakdown, unusual or unexpected geological or structural formations, cave-ins, flooding and severe weather); inadequate insurance, or inability to obtain insurance to cover these risks and hazards; employee relations; relationships with, and claims by, local communities and indigenous populations; the Company’s ability to obtain all necessary permits, licenses and regulatory approvals in a timely manner or at all; changes in laws, regulations and government practices, including environmental, export and import laws and regulations; legal restrictions relating to mining including those imposed in connection with COVID-19; risks relating to expropriation; increased competition in the mining industry; a successful relationship between the Company and Orion; the failure by Pilar Gold to meet one or more of its commitments to the Company and those factors identified in the section titled “Risks and Uncertainties” in this MD&A and in the section titled “Risks Related to the Business” in the Company’s Annual Information Form dated March 24, 2021, for the year ended December 31, 2020, which is available on SEDAR at www.sedar.com and on EDGAR at www.sec.gov/edgar. Forward-looking statements and information are designed to help readers understand management's views as of that time with respect to future events and speak only as of the date they are made. Except as required by applicable law, the Company assumes no obligation to update or to publicly announce the results of any change to any forward-looking statement or information contained or incorporated by reference to reflect actual results, future events or developments, changes in assumptions or changes in other factors affecting the forward-looking statements and information. If the Company updates any one or more forward-looking statements, no inference should be drawn that the Company will make additional updates with respect to those or other forward-looking statements. All forward-looking statements and information contained in this MD&A are expressly qualified in their entirety by this cautionary statement.


Management’s Discussion and Analysis For the three months and year ended December 31, 2021


CAUTIONARY NOTES AND FORWARD-LOOKING STATEMENTS (CONTINUED)

Cautionary Note to U.S. Readers Concerning Estimates of Mineral Reserves and Mineral Resources

Disclosure regarding the Company's mineral properties, including with respect to mineral reserve and mineral resource estimates included in this MD&A, was prepared in accordance with NI 43-101. NI 43-101 is a rule developed by the Canadian Securities Administrators that establishes standards for all public disclosure an issuer makes of scientific and technical information concerning mineral projects. NI 43-101 differs significantly from the disclosure requirements of the Securities and Exchange Commission (the “SEC”) generally applicable to U.S. companies. Accordingly, information contained in this MD&A is not comparable to similar information made public by U.S. companies reporting pursuant to SEC disclosure requirements.


TECHNICAL INFORMATION

Doug Reddy, MSc, P.Geo, Chief Operating Officer, and Scott Heffernan, MSc, P.Geo., EVP Exploration, are the Qualified Persons under NI 43-101 for Equinox Gold and have reviewed and approved the technical content of this document.