Mr. John Wenger reports

CONTACT GOLD REPORTS Q1 2023 FINANCIAL AND OPERATING RESULTS AND VOTING RESULTS FROM ANNUAL MEETING

Contact Gold Corp. has released its financial and operating results for the three months ended March 31, 2023, and provided the results of the company's recent annual meeting of shareholders.

Contact Gold is focused on advancing the Green Springs oxide gold project and the Pony Creek gold project, both of which host extensive and robust Carlin-type gold systems.

Green Springs is located on Nevada's Cortez trend, seven kilometres immediately east of the Gold Rock project operated by Calibre Mining Corp. Exploration at Green Springs is being financed through a partnership with a subsidiary of Centerra Gold Inc., pursuant to an earn-in arrangement. Pony Creek is located on the southern Carlin trend and ties on to the southern boundary of the feasibility-stage South Railroad gold project operated by Orla Mining Ltd.

Recent developments and Q1 2023 highlights:

• Entered into the Centerra farmout providing Centerra the option to acquire a 70-per-cent interest in Green Springs for cumulative earn-in exploration expenditures of $10-million (U.S.) and aggregate cash payments to the company of $1-million (U.S.) over a four-year period:
  • Centerra will finance a minimum commitment of $1.5-million (U.S.) in exploration expenditures during the first year of the earn-in or pay the difference to Contact Gold in cash;
  • Contact Gold is the project manager for exploration at Green Springs for at least the first year of the Centerra farmout (thereafter, Centerra has the right to be project manager), and the company shall collect a management fee based on eligible expenditures through the earn-in;
• Expanded the Green Springs property area by 19 per cent through staking of open ground covering prospective targets;
• Launched the 2023 exploration program at Green Springs, financed by Centerra and led by Contact Gold:
  • The reverse circulation (RC) drill program is expected to begin at the end of May, 2023;
  • Budget of $1.85-million (U.S.), including a planned 4,500 metres of RC drilling for up to 45 drill holes:
    • Approved 2023 exploration and drill program represents a 23-per-cent-larger program than the contractual minimum first-year work commitment;
    • Drill program is more than twice that of the 2021 discovery program;
• Closed a non-brokered private placement of 50 million units at a price of two cents per unit for gross proceeds of $1-million; each unit consists of one common share of the company and one Contact share purchase warrant, with each warrant entitling the holder to purchase an additional Contact share at a price of five cents per Contact share until expiry on Feb. 23, 2026.

For further details on the earn-in with Centerra, please see Contact Gold's news release dated Dec. 9, 2022.

Selected Q1 2023 financial data

Details of financial results as at and for the three months ended March 31, 2023, and March 31, 2022, are described in the unaudited condensed interim consolidated financial statements and related notes thereto, as prepared in accordance with international financial reporting standards (IFRS), and the management discussion and analysis for the corresponding periods, copies of which are available on SEDAR.

The selected financial data in the attached tables are derived from the interim financial statements.

Losses attributable to shareholders for the three months ended March 31, 2023, of $300,000 (2022: $820,000), reflect primarily: (i) costs incurred for professional, legal and advisory fees, administration and office expenditures, wages and salaries, and investor relations activities (in aggregate, $320,000, compared with $580,000 for the same period in 2022); and (ii) exploration and evaluation of the company's exploration property interests ($70,000, net of the amount recovered from Centerra).

Losses for the current period are lower than those of the prior period, reflecting, in part, the timing of exploration activities at Green Springs, the accounting offset of the majority of expenditures incurred at Green Springs as a result of the recovery of funds from Centerra, and an overall reduction of legal and advisory fees and administration and office expenditures as part of a continuing effort to reduce non-exploration-related expenditures.

The company has elected to expense exploration expenditures as incurred. During the three months ended March 31, 2023, exploration and evaluation expenditures were predominantly related to preparations for a resumption of activity at Green Springs in June, 2023, including the evaluation and review of data generated through 2022.

Details of exploration and evaluation activities incurred and expensed by Contact Gold at Green Springs, including non-cash items for each respective period, are as shown in an attached table.

Other comprehensive gain attributable to shareholders for the three-month period ended March 31, 2023, was $400,000 (three months ended March 31, 2022: loss of $420,000). The other comprehensive loss or gain in a given period reflects primarily the foreign currency impact arising on the carrying value of the company's U.S. entity, which holds the exploration property portfolio, whereby a gain or loss reflects the relative value of the Canadian dollar (the company's reporting currency) compared with the U.S. dollar (the currency in which the value of the exploration property portfolio is recorded) and the revaluation of marketable securities.

Summarized balances from the statements of financial position of each period are as shown in an attached table.

Total assets at March 31, 2023, comprise primarily exploration properties of $30.82-million and $810,000 in cash and cash equivalents. The company also holds $110,000 in marketable securities. At Dec. 31, 2022, total assets consist primarily of the value of exploration properties ($30.89-million) and cash ($140,000).

Total liabilities at March 31, 2022, include a provision for estimated future site reclamation costs of $150,000 (Dec. 31, 2022: $150,000), normal course payables and accruals of $300,000 (Dec. 31, 2022: $540,000), settled after period-end, and a balance of $100,000 advanced by Centerra in advance of exploration completed through the months of April and May, 2023.

Net cash operating outflows for the three-month period ended March 31, 2023, of $180,000 (2022: $590,000) include exploration expenditures ($240,000), marketing and investor relations activities ($20,000), general corporate activities ($70,000), and the settlement of balances due to related parties, service providers and vendors.

Voting results from annual meeting

The company has also released voting results from the May 25, 2023, annual general meeting. A total of 171,632,812 common shares were voted, representing the votes attached to approximately 48.82 per cent of all outstanding common shares. Shareholders voted in favour of the election of all director nominees.

Shareholders also voted in favour of: (i) the appointment of MNP LLP, chartered professional accountants, as auditor of the company, and (ii) the reapproval of the 10-per-cent rolling option and incentive plan. The incentive plan was unchanged from that of the prior year, which was approved by the TSX Venture Exchange on June 30, 2022. Approval of the incentive plan includes the approval off all unallocated options, RSUs (restricted share units), DSUs (deferred share units) and other contemplated forms of incentive remuneration to participants thereunder.

Immediately following the meeting, Charlie Davies informed the company that he would be resigning from the board with immediate effect. Mr. Davies joined the board as a nominee of Waterton Precious Metals Fund II Cayman LP. Waterton was a major shareholder of Contact Gold dating back to the company's acquisition of Pony Creek in 2017 and held a director nomination right, with Mr. Davies as the Waterton employee joining the company's board. On April 26, 2023, Waterton divested of its entire equity position in Contact Gold in a block trade to a number of purchasers, including experienced precious metal investors and certain insiders of the company. Mr. Davies is stepping down as a reflection of that change. Contact Gold would like to thank Mr. Davies for his years of service to the company and wishes him the best in all of his endeavours.

About Contact Gold Corp.'s property interests

Green Springs is strategically located seven kilometres immediately east of the Gold Rock project operated by Calibre Mining Corp. and 20 kilometres southeast of its Pan mine. The Green Springs property is 23.2 square kilometres, encompassing three shallow past-producing open pits and numerous targets that were not mined. The company is the operator of Green Springs and will lead exploration under Centerra's $10-million (U.S.) earn-in.

Strategically located immediately south of Orla Mining Ltd.'s Railroad-Pinion project, on the southern Carlin trend, Pony Creek totals 81.7 square kilometres and is 100 per cent owned by Contact Gold. The company published a first-time mineral resource estimate at Pony Creek in early 2022 and expects to commence a resource expansion program later in 2023.

We seek Safe Harbor.