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## Commander Resources Ltd. Management Discussion and Analysis For the Year Ended December 31, 2012 

The largest portion of exploration expenditures was $625,828 on the Baffin properties for camp purchases, geology cost and environmental cleanup, of which $537,369 were recovered from AngloGold as a final settlement for discontinuing the Farm-in and JV agreement with Commander. Spending on other properties for the year ended December 31, 2012 totalled to $718,782 including $325,313 on the Stump Lake property, $127,399 on the Omineca property, $120,974 on the Sabin property, $88,589 on the Glenmorangie property, $8,406 on the Storm property and $48,101on the rest of the Company’s properties. The Company recovered $120,000 on the Storm property through Aston Bay’s cash payment and share distribution. More information is available on the Mineral Property Expenditure Table and in Note 9 of the Financial Statements for the year ended December 31, 2012. 

Commander had no revenue and general and administrative expenses decreased by $581,378 to $809,681 compared to $1,391,059 in 2011. Decreases in most expenses were the result of deconsolidation of Maritime as at February 15, 2012. 

Some notable variances are analyzed below: 

- Accounting and audit decreased by $64,685 (41%) to $91,735 (2011 - $156,420). 

- Administration and others decreased by $47,425 (23%) in relation to the following: 

- Consulting expense decreased by $58,413 (46%) to $68,900 (2011 - $127,313). 

- Legal fees decreased by $10,112 (32%) to $21,559 (2011 - $31,671 in 2011). 

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- Salaries and benefits expense decreased by $32,917 (14%) to $209,448 (2011 - $242,365). 

- Investor relations and promotion expenses decreased by $40,386 (21%) in relation to the following: 

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- Share-based payments for the year were $100,002 compared to $425,121 in 2011 in respect of the vesting of stock option, in relation to the following: 

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- Commander recognized an impairment loss of $471,486 (2011 - $Nil) on investment in securities. 

- Commander wrote down a total of $916,789 on impaired properties (2011 - $3,958,279). . 

- Commander’s share of loss in Maritime after deconsolidation from February 16 through December 31, 2012 was $161,438. 

- Commander recognized dilution losses resulting from the decrease in equity interest in Maritime amounted to $103,414. 

- A total gain of $3,186,676 was realized on the deconsolidation of Maritime, including a cash gain of $198,529 and non-cash gain of $2,988,147. 

