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InvestorPresentationJanuary2017
CautionaryNoteNon-GAAPMeasuresThispresentationofPanAmericanSilverCorp.(the“Company”)referstovariousnon-GAAPmeasures,suchascashcostsperpayableounceofsilver,netofby-productcredits(“CashCosts”),all-insustainingcostpersilverouncesold(“AISCSOS”)andworkingcapital.ThesemeasuresdonothaveastandardizedmeaningprescribedbyIFRSasanindicatorofperformance,andmaydifferfrommethodsusedbyothercompanies.Readersshouldrefertothe“AlternativePerformance(non-GAAP)Measures”sectionintheCompany’sManagement’sDiscussionandAnalysisfortheperiodendedSeptember30,2016,availableatwww.sedar.com.ReportingCurrencyandFinancialInformationUnlesswehavespecifiedotherwise,allreferencestodollaramountsor$aretoUnitedStatesdollars.CautionaryNoteRegardingForwardLookingStatementsandInformationCertainofthestatementsandinformationinthispresentationconstitute“forward-lookingstatements”withinthemeaningofthe UnitedStatesPrivateSecuritiesLitigationReformActof1995and“forward-lookinginformation”withinthemeaningofapplicableCanadianprovincialsecuritieslaws.Allstatements,otherthanstatementsofhistoricalfact,areforward-lookingstatementsorinformation.Forward-lookingstatementsorinformationinthispresentationrelateto,amongotherthings:ourestimatedproductionofsilver,goldandothermetalsin2017,2018and2019;ourestimatedcashcostsperpayableounceofsilverandAISCSOSin2017,2018and2019;ourestimatedoperatingmarginsfor2017,2018and2019;ourestimatedcapitalinvestments,andsustainingcapitalfor2017,2018and2019;theabilityoftheCompanytosuccessfullycompleteanycapitalinvestmentprogramsandprojects,andtheimpactsofanysuchprogramsandprojectsontheCompany;theabilityoftheCompanytorealizevaluefromtransactions,includingwithrespecttotheJoaquinProjectandMaverix MetalsInc.;expectationswithrespecttofuturepricesofsilverorotherpreciousmetals,world-widesilverproduction,orglobaldemandonsilver,orothersimilarmetricsrelatingtosilver; andanyanticipatedleveloffinancialandoperationalsuccessin2017.ThesestatementsandinformationreflecttheCompany’scurrentviewswithrespecttofutureeventsandarenecessarilybaseduponanumberofassumptionsthat,whileconsideredreasonablebytheCompany,areinherentlysubjecttosignificantoperational,business,economicandregulatoryuncertaintiesandcontingencies.Theseassumptionsinclude:tonnageoforetobeminedandprocessed;oregradesandrecoveries;pricesforsilver,goldandbasemetalsremainingasestimated;currencyexchangerates remainingasestimated;capital,decommissioningandreclamationestimates;ourmineralreserveandrecourseestimatesandtheassumptionsuponwhichtheyarebased;pricesforenergyinputs,labour,materials,suppliesandservices(includingtransportation);nolabour-relateddisruptionsatanyofouroperations;nounplanneddelaysorinterruptionsinscheduledproduction;allnecessarypermits,licensesandregulatoryapprovalsforouroperationsarereceivedinatimelymanner;andourabilitytocomplywithenvironmental,healthandsafetylaws.Theforegoinglistofassumptionsisnotexhaustive.TheCompanycautionsthereaderthatforward-lookingstatementsandinformationinvolveknownandunknownrisks,uncertaintiesandotherfactorsthatmaycauseactualresultsanddevelopmentstodiffermateriallyfromthoseexpressedorimpliedbysuchforward-lookingstatementsorinformationcontainedin thispresentationandtheCompanyhasmadeassumptionsandestimatesbasedonorrelatedtomanyofthesefactors.Suchfactorsinclude,withoutlimitation:fluctuationsinsilver,goldandbasemetalprices;fluctuationsinpricesforenergyinputs,labour,materials,suppliesandservices(includingtransportation);fluctuationsincurrencymarkets(suchastheCanadianDollar,PeruvianSol,MexicanPeso,ArgentinePesoandBolivianBolivianoversustheU.S.Dollar);operationalrisksandhazardsinherentwiththebusinessofmining(includingenvironmentalaccidentsandhazards,industrialaccidents,equipmentbreakdown,unusualorunexpectedgeologicalorstructuralformations,cave-ins,floodingandsevereweather);risksrelatingtothecreditworthinessorfinancialconditionofsuppliers,refinersandotherpartieswithwhomtheCompanydoesbusiness;inadequateinsurance,orinabilitytoobtaininsurance,tocovertheserisksandhazards;employeerelations;relationshipswith,andclaimsby,localcommunitiesandindigenouspopulations;ourabilitytoobtainallnecessarypermits,licensesandregulatoryapprovalsinatimelymanner;changesinlaws,regulationsandgovernmentpracticesinthejurisdictionswhereweoperate,includingenvironmental,exportandimportlawsandregulations;diminishingquantitiesorgradesofmineralreservesaspropertiesaremined;increasedcompetitionintheminingindustryforequipmentandqualifiedpersonnel;andthosefactorsidentifiedunderthecaption“RisksRelatedtoPanAmerican’sBusiness”intheCompany’smostrecentform40-FandAnnualInformationFormfiledwiththeUnitedStatesSecuritiesandExchangeCommissionandCanadianprovincialsecuritiesregulatoryauthorities.AlthoughtheCompanyhasattemptedtoidentifyimportantfactorsthatcouldcauseactualresultstodiffermaterially,theremaybeotherfactorsthatcauseresultsnottobeasanticipated,estimated,describedorintended.Investorsarecautionedagainstunduerelianceonforward-lookingstatementsorinformation.Forward-lookingstatementsandinformationaredesignedtohelpreadersunderstandmanagement’scurrentviewsofournearandlongertermprospectsandmaynotbeappropriateforotherpurposes.TheCompanydoes notintend,nordoesitassumeanyobligationtoupdateorreviseforward-lookingstatementsorinformation,whetherasaresultofnewinformation,changesinassumptions,futureeventsorotherwise,excepttotheextentrequiredbyapplicablelaw.TechnicalInformationTechnicalinformationcontainedinthispresentationwithrespecttoPanAmericanSilverCorp.hasbeenreviewedandapprovedbyMartinWafforn,P.Eng.,SVPTechnicalServicesandProcessOptimization,whoistheCompany’squalifiedpersonforthepurposesofNationalInstrument43-101.Mineralreservesinthispresentationwerepreparedunderthesupervisionof,orwerereviewedby,MartinWafforn.ForadditionalinformationabouttheCompany’smaterialmineralproperties,pleaserefertotheCompany’sAnnualInformationFormdatedMarch24,2016,filedatwww.sedar.com.
2 January17,2017
CautionaryNoteAboutMineralReservesandResources
3 January17,2017
CautionaryNotetoUSInvestorsConcerningEstimatesofMineralReservesandResources
Thispresentationhasbeenprepared inaccordancewiththerequirementsofCanadiansecuritieslaws,whichdifferfromtherequirementsofU.S.securitieslaws.Unlessotherwise indicated,allmineral reserveandresourceestimatesincludedinthispresentationhavebeenprepared inaccordancewithCanadianNationalInstrument43-101–StandardsofDisclosureforMineralProjects (‘‘NI43-101’’)andtheCanadianInstituteofMining,MetallurgyandPetroleumclassificationsystem.NI43-101isaruledevelopedbytheCanadianSecuritiesAdministratorsthatestablishesstandardsforallpublicdisclosureanissuermakesofscientificand technicalinformationconcerningmineralprojects.
Canadianstandards,includingNI43-101,differsignificantlyfromtherequirementsoftheUnitedStatesSecuritiesandExchangeCommission(the“SEC”),andinformationconcerningmineralization,deposits,mineral reserveandresourceinformationcontainedorreferredtohereinmaynotbecomparable tosimilarinformationdisclosedbyU.S.companies.Inparticular,andwithoutlimiting thegenerality oftheforegoing,thispresentationusestheterms‘‘measuredresources’’, ‘‘indicatedresources’’and‘‘inferredresources’’.U.S. investorsareadvisedthat,while suchtermsarerecognizedandrequiredbyCanadiansecuritieslaws, theSECdoesnotrecognizethem.The requirementsofNI 43-101foridentificationof‘‘reserves’’arenotthesameasthoseoftheSEC,andreservesreportedbyPanAmericanincompliancewithNI 43-101maynotqualifyas‘‘reserves’’ underSECstandards.UnderU.S.standards,mineralizationmaynotbeclassifiedasa‘‘reserve’’unlessthedeterminationhasbeenmadethatthemineralizationcouldbeeconomicallyandlegallyproducedorextractedatthetime thereserve determination ismade.U.S. investorsarecautionednottoassumethatanypartofa“measuredresource”or“indicatedresource”willever beconvertedintoa“reserve”.U.S.investorsshouldalsounderstandthat“inferredresources”haveagreatamountofuncertaintyastotheirexistenceandgreatuncertaintyastotheireconomicandlegalfeasibility. Itcannotbeassumedthat alloranypartof“inferredresources”exist,areeconomicallyorlegally mineableorwilleverbeupgradedtoahighercategory.UnderCanadiansecuritieslaws,estimated“inferredresources”maynotformthebasisoffeasibilityorpre-feasibility studiesexceptinrarecases.Disclosureof“containedounces”inamineralresourceispermitted disclosureunderCanadiansecuritieslaws.However,theSECnormallyonlypermitsissuerstoreportmineralizationthatdoesnotconstitute“reserves”bySECstandardsasinplacetonnageandgrade,withoutreference tounitmeasures.Accordingly,informationconcerningmineraldepositssetforthhereinmaynotbecomparablewithinformationmadepublicbycompaniesthatreportinaccordancewithU.S. standards.
PAS– aninvestmentinsilver
ü 2ndlargestprimarysilverproducerintheworldü Portfolioofhigh-qualityassetsintheAmericasü Largereserves:provenandprobableof280Moz silver(1)
ü Solidproductionprofileü Significantexplorationpotentialü Experiencedmanagementteamü Strongbalancesheet
Ourstrategyisfocusedonextractingvaluefromourportfolioofassets,improvingoperatingmarginsanddeployingprovenexpertisetopursue
profitablegrowth.
4 January17,2017(1) Pleaserefer totheAppendix formoredetailedinformation ontheCompany’sreserves.
Ouroperations
5 January17,2017
MillionSilverOuncesProduced
Historyofproductiongrowth
6 January17,2017Pleaserefer totheCompany’snewsreleasedatedJan.12,2017formoreinformation onthe2016preliminary operatingresultsandthethree-yearoutlook.
0
5
10
15
20
25
30
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017F2018F2019F
Positionedforstrongsilverrevenue
5%5%
15%
24%
51%silver
Copper Lead Zinc Gold Silver
7 January17,2017
8% 4%
12%
27%
50%silver
Copper Lead Zinc Gold Silver
2016PreliminaryResults
2017Estimate
Basedon2016preliminary metalsalesandprices:Ag$17.35/oz,Au$1,251/oz, Zn$2,095/tonne,Cu$4,860/tonne, Pb $1,872/tonne)
Basedon2017estimatedmetalsalesandprices:Ag$17.00/oz, Au$1,200/oz, Zn$2,500/tonne, Cu$5,400/tonne,Pb $2,100/tonne
Pleaserefer totheCompany’snewsreleasedatedJan.12,2017formoreinformation onthe2016preliminary operatingresultsandthe2017forecast.
2016preliminaryoperatingresults
8
35%decreaseinCashCosts(1)from2015$6.29/oz ofsilver(netofby-productcredits)
25.4Mouncessilver
183,900ouncesgold
(1) Thispresentation referstomeasuresthatarenotgenerallyacceptedaccounting principle (“non-GAAP”)financialmeasures,including cashcostperpayableounce ofsilver,netofby-product credits (“CashCosts”).Pleasereferto“AlternativePerformance (non-GAAP)Measures”section oftheCompany’sManagement’sDiscussion &Analysisfortheperiod endedSept.30,2016.
Financialstrength
USDMillions
Cashandcashequivalentsandshort-term investments 245.3
Working capital(1) 434.2
Total debt(2) 47.0
Totalavailableliquidity (3) 509.1
AtSept.30,2016
9 January17,2017
(1) Workingcapitalisanon-GAAPmeasurecalculated ascurrent assetslesscurrent liabilities. TheCompanyandcertain investorsusethisinformation toevaluatewhether theCompanyisabletomeetitscurrent obligationsusingitscurrent assets.Referto“AlternativePerformance (non-GAAP)Measures”section oftheCompany’sManagement’sDiscussion &AnalysisfortheperiodendedSept.30,2016.(2) Inclusiveof$5.7million incapitalleases.(3) Includescashandcashequivalents, short-term investments, andtheundrawn portion oftheCompany’ssecuredlineofcredit.
Improvingoperatingmargins
10 January17,2017
By-product metalpricesassumptions usedforforecast CashCostscalculation: Au$1,200/oz, Zn$2,500/tonne, Pb $2,100/tonne, Cu$5,400/tonne. ExchangeratesrelativetoUS$assumed:Mexicanpeso20:1,Peruviansol3.3:1,Argentinepeso17.05:1,Bolivian boliviano7:1.CashCosts isanon-GAAPmeasure.Referto“AlternativePerformance (non-GAAP)Measures”section oftheCompany’sManagement’sDiscussion &AnalysisfortheperiodendedSept.30,2016.
Capitalexpenditureprofile(1)
11 January17,2017(1) Guidance asprovidedinPanAmerican’snewsreleasedatedJan.12,2017.
(inmillionsofUSD)
2017Guidance
2018Outlook
2019Outlook
Sustainingcapitaltotal 82- 88 75- 85 75- 90
Projectcapitaltotal 58- 62 N/A N/A
Consolidated total 140 - 150 75 - 85 75- 90
Capitalallocationpriorities
$361
$491
$542
$423
$330
$227$245
$0
$100
$200
$300
$400
$500
$600
2010 2011 2012 2013 2014 2015 YTDQ32016
MillionsUS$
Cash&STI
Financialdebt
Cumulativereturntoshareholders
$385Mintotalcumulativecashreturned toshareholders (dividends andsharebuy-backs)since2010inadditiontoinvesting$376Mincapitalprojects.
12 January17,2017
PanAmerican’sapproachtocapitalmanagementprioritizesinvestmentinprojectsthatgenerateahigh-rateofreturn,maintainingastrongbalancesheetandreturning cashtoshareholders.
TheCompany’s lastpublicequityfinancingwas in2009.
Cash & short term investments
0
50
100
150
200
250
300
350
400
450
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
2010 2011 2012 2013 2014 2015 2016
SilverGradeg/t
MillionTonnes
ProvenandProbableReserves2010-2016Probable(Mt)
Proven(Mt)
SilverGrade(g/t)
LaColoradareservesincrease300%
13 January17,2017
30.4MozAg
38.3MozAg
44.1MozAg
64.8MozAg
81.4MozAg
86MozAg91.2MozAg
ForLaColorada’s complete mineralreservedetails, pleaseseeAppendix.
Organicgrowth– LaColoradaexpansion
14 January17,2017
AtDec31,2015P&P3.8Mt*Ag 436g/t(53.7Moz)
Au0.33g/tPb 1.88%Zn3.47%
AtDec31,2015P&P2.8Mt*Ag 378g/t(34.0Moz)
Au0.31g/tPb 0.82%Zn1.47%
AtDec31,2015P&P0.4Mt*Ag 303g/t(3.5Moz)
Au0.30g/tPb 1.10%Zn1.44%
ForLaColorada’s complete mineralreservedetails, pleaseseeAppendix.
LaColorada expansion(1)
15 January17,2017
Highlights• 69%increaseexpectedinaverageannual
silverproductionto7.7Moz by2018• 137%and185%increaseexpectedinzinc
andleadproduction,respectively, by2018ProjectScope• New618-metredeepmineshaft– fully
commissionedinQ32016• Newsulphide processingplant– began
operatingQ32016• Undergrounddevelopmenttoopennew
productionareas– advancingonscheduleforcompletionin2017
• New115kVpowerline- targetedforcompletionin2017
(1) Foradditionalinformation,pleaserefertotheCompany’stechnicalreportentitled“TechnicalReport– PreliminaryEconomicAnalysisfortheExpansionoftheLaColorada Mine,Zacatecas,Mexico”,withaneffectivedateofDec.31,2013availableatwww.SEDAR.com.Theresultsofthispreliminaryeconomicassessmentarepreliminaryinnature,inthatitincludesinferredmineralresources thatareconsidered toogeologicallyspeculativetohavetheeconomicconsiderationsappliedtothemthatwouldenablethemtobecategorizedasmineralreserves,andthereisnocertaintythattheassessmentwillberealized.Mineralresourcesthatarenotmineralreserveshavenodemonstratedeconomicviability.
Original investmentof$163.8M,including sustainingcapital,generatedanIRRof22%atAg$19/ozNowexpectedtobe5-10%under budget
Organicgrowth– Doloresexpansion
16 January17,2017
N
SouthextensionundergroundresourcesatDecember31,2014:
Tonnes Agg/t Aug/tMeasured 146,000 101 0.74Indicated 2,907,000 56 1.59Total 3,054,000 58 1.55
Doloresexpansion(1)
17 January17,2017
Highlights
• Duringfirst5years,estimatedincreasesinaverageannualproductionof:
• Silverup40%• Goldup52%
• ReduceCashCosts throughoperationalefficiencies andhighergoldproduction
ProjectScope• New5,600tpd pulpagglomerationplant-
scheduled forstart-upinmid2017
• Newundergroundmine- scheduled toreach1,500tpd byendof2017
• New115kVpowerline- energizedinSeptember2016
(1) Foradditionalinformation,pleaserefertotheCompany’stechnicalreportentitled“TechnicalReportfortheDoloresProperty,Chihuahua,Mexico- PreliminaryEconomicAssessmentof aPulpAgglomerationTreatmentandUndergroundOption”,withaneffectivedateofMay31,2014availableatwww.SEDAR.com.Theresultsofthispreliminaryeconomicassessmentarepreliminaryinnature,inthatitincludesinferredmineralresourcesthatareconsideredtoogeologicallyspeculativetohavetheeconomicconsiderationsappliedtothemthatwouldenablethemtobecategorizedasmineralreserves,andthereisnocertaintythattheassessmentwillberealized.Mineralresourcesthatarenotmineralreserveshavenodemonstratedeconomicviability.
Estimatedcapitalinvestment~$132.4M(incl.powerline)IRR27%atAg$19/oz &Au$1,200/ozOnbudget
Productionbymine2017Guidance
20%
1%
24%
18%
14%
11%
12%
18 January17,2017
26%
1%
17%
15%
10%
18%
13%
SilverOunces SilverEquivalentOunces
Basedonthemid-point ofproduction estimatesfor2017(Agof24.5M– 26.0Mounces,Auof155,000 - 165,000ounces, Znof56,500tonnes- 58,500 tonnes,Pb of19,000tonnes - 20,000 tonnes, andCuof8,750 tonnes - 9,250tonnes).Silverequivalentounceshavebeencalculatedforgoldandthebasemetalby-products usingthefollowing metalprices:Ag$17.00/oz,Au$1,200/oz, Zn$2,500/tonne, Cu$5,400/tonne,andPb $2,100/tonne.
January17,2017
Explorationandproductiongrowth• 2017explorationbudgetofUS$21M,up45%from2016
• Solidperformanceonreplacingproduction withnewreservesduring theperiod2004- 2015(1)
• Added293Moz ofcontainedsilvertomineralreservesduringtheperiod• AveragereservereplacementcostofUS$0.44/oz (2)
• LaColorada continuestodeliverinbothnewreservesandextensiontominelife
• HighpotentialatPeruoperations;nearsiteandgreenfieldexploration
• KootenaySilverInc.optionbringsanadvancedsilverexplorationprojectintothepipelinewithexcellentregionalexplorationpotential
• 100%ownerofNavidad,oneofthelargestundeveloped silverdeposit intheworld:
19 (1) Mineralreserveandresource information atDec.31,2016isexpected tobereleasedinFebruary,2017(2) Overtheperiod 2004-2015(3) Estimatedusingapriceof$12.52/oz ofsilver
Silver Resources(3)AsofDec.31,2015
ContainedAg(Moz) Tonnes (Mt) Ag(g/t)
Measured (containedMoz) 67.8 15.4 137
Indicated(containedMoz) 564.5 139.8 126
Inferred(containedMoz) 119.4 45.9 81
StrategicinitiativestosurfacevalueMaverix (1)
• PanAmericanrealizedvalueforassetshiddenwithinitsportfoliothroughsaletoMaverixMetalsInc.(royalties,preciousmetalsstreams)
• Providesadditionalleveragetogoldandsilverprices• OpportunetimingforMaverix toattractnewgrowthprospects,asindicatedbyMaverix’s
recentacquisitionofadditionalroyaltiesfromGoldFieldsNetherlandsServicesBV• Maverix hasamarketcapofaboutCAD$232Mandisup149%sincetheacquisitionof
PanAmericanassetsclosed(2)
• PanAmericanholdsapproximately40%ofMaverix (43%fully-diluted)
Milpo Shalipayco JointVenture• PanAmericansold75%ofitssharesinCompania Minera Shalipayco SACtoVotorantim
Metais – Cajamarquilla SAforUS$15Mcashand1%NetSmelterReturn(soldtoMaverix)• PanAmericanreceivesfreecarryofitsremaining25%interesttocommercialproductionin
thislargezincdevelopmentprojectlocatedinPeru
20 January17,2017
(1) SeepressreleasesdatedJuly11,2016andDec.27,2016,availableatwww.sedar.com(2) BasedonMaverix (MMX)openingprice onTSX-VonJuly12,2016ofCAD$0.70/sharecomparedtoclosingprice onJan.12,2017ofCAD$1.75/share.
JoaquinProject(Argentina)
21
• PanAmericantoacquire100%ofCoeurMining’s Joaquinproject:
• US$25M(US$15McashandUS$10MinPAASshares)plus a2%NSR
• SynergieswithPanAmerican’sManantial Espejo operation
• Processing capacityavailableatManantial Espejo plant
• Joaquinwithintruckingdistance
• Potentialforfurtherexplorationsuccess
Joaquinislocatedabout145KmfromourManantial Espejomine
Addinghigh-gradesatellitedepositstorealizefurthervalueatManantial Espejo
Formoreinformation seethepressreleasedatedJan.17,2017
WhyinvestinPAAS
22 January17,2017
1. Strong leveragetosilverprices– acommoditywithdemandforindustrialusesandasa“safe-haven”investment
2. Low-costsilverproducerwithgrowing production overthenext3years
3. Increasingfreecashflowpotentialfollowing completionofexpansionsatLaColoradaandDolores
4. Pipelineoforganicgrowthopportunities
5. Prudent financialmanagementcreatesvaluethroughout thecommoditypricecycle
Appendix
23
Companyoverview
• Listings:NASDAQ (PAAS)andTSX (PAA)
• Marketcap:US$2.6B(1)
• Sharesoutstanding: approx.152.2M
• Averagedailyvolume:2.6M(1)
• Paiddividends since2010- Currentyield0.3%(2)
52%46%
2%
Ownership(3)
ReportedInstitutional Impliedretail Insiders
24 January17,2017
AlldataasofcloseJan.10,2017(1)BasedonNasdaqexchange(2)Basedondividend declaredNov.14,2016,annualized(3)Source:IPREO
Sustainabilityleadership
25 January17,2017
Recognizedasaleaderinsustainabilityintheminingindustry
Plan
• Toolkits• Program
development
Engage
• StakeholderEngagement
• GrievanceMechanisms
Environmental&SocialAudits
SustainabilityReporting
InternalCapacityBuilding
EvaluatePerformanceMetrics
Implement
• Programsandprojectscoveringsustainabilitypillars
SustainabilityReport&Pillars
Education&Health
SustainableDevelopmentPrograms
LocalProcurementDevelopment
Infrastructure&UrbanFootprint
WaterandEnergy
Stewardship
TailingsFacilitySafety
EmergencyResponse
PreparednessMineClosure
Policy
• CSR• Environmental• Healthand
Safety• Governance
Sustainabilityawards&recognitions
Corporate
• CorporateKnightsrankedPanAmericanSilver36thontheirFuture40ResponsibleCorporateLeadersinCanada.
• ThePeruvian-CanadianChamberofCommerceawardedPanAmericanSilverthe“BusinessoftheYear2015”awardforourcontributionstosustainabledevelopmentthroughourUQLLU/Alpacadelos Andesweavingproject.
Mexico
• AllmineswereawardedwiththeSociallyResponsibleCompany(ESR)AwardpresentedbytheCentroMexicano paralaFilantropía (CEMEFI).
• AllminesmaintainedtheCleanIndustryindependentenvironmentalcertificationbytheMexicanEnvironmentProtectionAgency(PROFEPA).
26 January17,2017
Viewsonthesilvermarket(1)
27 January17,2017(1)Sourcesinclude: BloombergMetalsFocusDecember, 2016andGFMS,ThomsonReuters /TheSilverInstitute2016
• RealinterestratesintheU.S.likelytoremainlowin2017,despite expectedmonetarytightening
• USGDPgrowthconstrainedbyhighgovernmentdebt,limitinggovernment’s scopefornewroundoffiscalstimulus
• Europe’s bankingsectorremainsvulnerable
• Inflationarypressures arestartingtobuild
• Industrialdemandrepresentsjustunderhalfofthetotaldemandforsilver• Growingdemandthroughtheuseoftechnology, electronicsandrenewablesourcesofpower• Silverdemandfromthephotovoltaics industry nowrepresents14%ofsilver’s industrial demand,
upfromonly 1%adecadeago.• Emergingmarketeconomies, especiallyinChina, arestabilizing,liftingindustrialcommodity
demand
• Littletonogrowthinsilver supply becausemanyexplorationcompanies havenotbeeninvestinginexplorationandnewprojects
• Silversupply deficitexpectedin2017
Factorssupportcontinueddemandforsilverforbothindustrialapplicationsandasasafehavenasset
Consolidatedpreliminary2016operatingresults
Q42016 FullYear2016
Silverproduction(millionounces) 6.3 25.4
Goldproduction(thousandounces) 43.9 183.9
Zincproduction(thousandtonnes) 13.2 51.9
Leadproduction(thousandtonnes) 5.5 20.2
Copperproduction(thousandtonnes)
3.1 14.4
CashCosts(1) ($/ounce) 6.66 6.29
28 January17,2017
Preliminary CashCostsperpayableounceofsilver,netofby-product credits.Averageby-productmetalpricesfor2016were:Au$1,251/oz, Zn$2,095/tonne, Pb $1,872/tonne, andCu$4,860/tonne. CashCostsisanon-GAAPmeasureandreadersshouldrefer tothe“Alternative Performance (non-GAAP)Measures"sectionofPanAmerican’sManagement’sDiscussion andAnalysisfortheperiodendedSept.30,2016 formoreinformation.
Preliminary2016operatingresultsbymine
Mine SilverProduction (millionounces)
GoldProduction (thousand ounces)
CashCosts($/ounce)(1)
LaColorada 5.80 2.93 6.15
Dolores 3.84 102.76 -1.08
AlamoDorado 1.86 8.38 16.02
Huaron 3.81 0.81 5.79
Morococha (92.3%)(2) 2.54 2.14 4.21
SanVicente(95%)(2) 4.43 n/a 11.95
Manantial Espejo 3.14 66.89 4.28
Total(3) 25.42 183.92 6.29
29 January17,2017
(1)Preliminary CashCostsperpayableounceofsilver,netofby-product credits.Averageby-product metalprices for2016were:Au$1,251/oz, Zn$2,095/tonne, Pb $1,872/tonne, andCu$4,860/tonne. CashCostsisanon-GAAPmeasureandreadersshouldrefer torefertothe“AlternativePerformance (non-GAAP)Measures"sectionofPanAmerican’sManagement’sDiscussion andAnalysisfortheperiodendedSept.30,2016formoreinformation.(2)Reflects PanAmerican’s ownership intheoperation.(3)Totalsmaynotaddupduetorounding.
2017GuidancebymineMine
SilverProduction (millionounces)
GoldProduction(thousand ounces)
CashCosts($/ounce)(1)
La Colorada 6.4- 6.9 3.3- 3.5 3.35- 3.95
Dolores 4.0- 4.5 109.1- 115.0 1.25- 2.25
AlamoDorado 0.3 1.4- 1.5 18.00- 20.00
Huaron 3.7- 3.8 0.3- 0.4 5.95- 6.95
Morococha (92.3%)(2) 2.5- 2.6 2.9- 3.1 3.15- 4.15
SanVicente (95%)(2) 4.4- 4.5 0.5- 0.6 10.90- 11.90
Manantial Espejo 3.3- 3.4 37.5- 41.0 15.35- 16.25
Total(3) 24.5- 26.0 155.0- 165.0 6.45- 7.45
30 January17,2017
(1)CashCostsisanon-GAAPmeasureandreadersshould refertothe“AlternativePerformance (non-GAAP)Measures"section ofPanAmerican’s Management’sDiscussion andAnalysisfortheperiodendedSept.30,2016formoreinformation.(2)Reflects PanAmerican’s ownership intheoperation.(3)Totalsmaynotaddupduetorounding.
Three-yearoutlook2017Guidance 2018Outlook 2019Outlook
Silver production (million ounces) 24.5– 26.0 26.0- 28.0 26.5– 29.5
Gold production (thousand ounces) 155- 165 170- 185 175- 200
Zinc production (thousand tonnes) 56.5- 58.5 59.0- 63.0 55.0- 65.0
Lead production (thousand tonnes) 19.0- 20.0 23.0- 26.0 23.0- 27.0
Copper production (thousand tonnes) 8.75- 9.25 6.00- 8.00 4.00- 4.20
Cash Costs(1)($/ounce) 6.45- 7.45 5.60- 7.10 5.20– 6.80
Sustaining capital ($ millions) 82- 88 75- 85 75- 90
AISCSOS(1) ($/ounce) 11.50- 12.90 10.00- 12.20 9.30- 11.60
31 January17,2017
(1)CashCostsandAISCSOSarenon-GAAPmeasures. Pleaserefertothe“AlternativePerformance (non-GAAP)Measures"section ofPanAmerican’s Management’sDiscussion andAnalysisfortheperiodendedSept.30,2016formoreinformation.
PanAmericanSilverProvenandProbableReservesatDecember31,2015(1)(2)
Property Location Category Tonnes(Mt)
Agg/t
ContainedAg(Moz)
Aug/t
ContainedAu (000’soz)
Cu%
Pb%
Zn%
Huaron Peru Proven 6.1 172 33.6 0.41 1.40 2.99Probable 3.7 167 19.9 0.27 1.58 3.17
Morococha (92.3%) (3) Peru Proven 2.3 176 13.0 0.78 1.18 3.57Probable 1.9 202 12.6 0.53 1.35 3.70
La Colorada Mexico Proven 3.3 474 49.6 0.35 36.2 1.69 3.15Probable 3.7 346 41.6 0.30 35.9 1.18 2.06
Dolores Mexico Proven 23.0 28 20.7 0.96 706.0Probable 29.2 34 32.4 0.92 864.0
Alamo Dorado Mexico Proven 1.6 55 2.9 0.23 12.2Probable 0.0 - -
La Bolsa Mexico Proven 9.5 10 3.1 0.67 203.0Probable 6.2 7 1.4 0.57 113.1
Manantial Espejo Argentina Proven 2.5 120 9.4 1.60 126.4Probable 0.3 262 2.4 3.90 35.6
SanVicente(95%)(3) Bolivia Proven 2.0 482 30.4 0.35 2.66Probable 0.4 511 6.9 0.48 2.24
Total (4) Proven+Probable 95.7 91 280.1 0.84 2132.4 0.45 1.30 2.97
32 January17,2017
(1) As of Dec. 31, 2015. Prices used to estimate mineral reserves for 2015 were $17/oz of silver, $1,180/oz of gold, $1,800/tonne of lead, $1,800/tonne of z inc,and $5,000/tonne of copper, except atManantial Espejo where $14.50/oz of silver and $1,100/oz of gold was used for planned 2016 production, revertingto the previously statedmetal prices thereafter, and Alamo Dorado stockpiles where metal prices of $15/oz of silver and $1,100/oz of gold were used due totheir planned processing in the short term. Metal prices used for La Bolsa were $14/oz of silver and $825/oz of gold.
(2) Mineral reserve estimates were prepared under the supervision of, or were reviewed by Martin G. Wafforn, P. Eng., Sr. Vice President Technical Services andProcess Optimization, who is the Qualified Person as that term is defined in National Instrument 43-101 (“NI 43-101). Please refer to the Company’s AnnualInformation Form date March 24, 2016, available atwww.sedar.com for further information on these properties, including with respect to mineral reserves.
(3) This information represents the portion of mineral reserves attributable to Pan American based on its ownership interest in the operating entity as indicated.(4) Totals may not add up due to rounding.
33 January17,2017
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