Pan American Silver Corp. · TSX:PAAS
Pan American Silver — Investor Presentation (June 2023)
48 slides from Pan American Silver's investor presentation, June 2023
Slide 1: Investor Presentation June 2023
INVESTOR PRESENTATION // FEBRUARY 2023 I N V E S T O R P R E S E N TAT I O N // JUNE 2023
Slide 2: Cautionary Note and Non-GAAP Measures
2 and other metals forecasted for 2023, our estimated Cash Costs, AISC and fluctuations in prices for energy inputs, labour, materials, supplies and services expenditures in 2023; future anticipated prices for gold, silver and other metals (including transportation); fluctuations in currency markets
Slide 3: Cautionary Note Continued
3 CONTINUED herein may not be comparable to similar information disclosed by U.S. companies. In particular, and without limiting the generality of the foregoing, NOT AN OFFER OR A SOLICITATION this presentation uses the terms “measured mineral resources”, “indicated mineral resources”, ‘‘inferred mi
Slide 4: Yamana acquisition enhanced scale and quality of portfolio in the Americas
4 CANADA Head Office Timmins Dolores La Colorada Skarn Deposit // The acquisition of Yamana Gold Inc. enhanced the scale and quality of MEXICO GUATEMALA Pan American’s portfolio in the Americas, where we have been operating for nearly 3 decades Escobal (C&M) • 4 producing mines: Jacobina, El Peñon,
Slide 5: Significant increase in production from Yamana assets
55 // Yamana assets acquired have a long history of reserve replacement & an extensive exploration portfolio • Significant increase in production from 9-months of ownership in 2023: • Anticipated incremental Silver production of ~7.2M ozs(1) • Anticipated incremental Gold production of ~435K ozs(1)
Slide 6: Targeting $40-$60 million in annual post-tax synergies
6 // Targeting $40 - $60 million in annual post-tax synergies Established presence and expertise in Latin America will enable Pan American to leverage operational efficiencies and the growth potential of the acquired Yamana assets in the region Synergies driven by streamlining corporate costs, cross
Slide 7: 2023 guidance: material improvement in production and costs
7 // material improvement in production and costs Ag Au Sustaining capital of $305 - $320 million Project capital of 21.0 – 23.0 Moz 870 – 970 Koz $95 - $105 million ANNUAL CONSOLIDATED ANNUAL CONSOLIDATED PRODUCTION PRODUCTION Reclamation expenditures of $18 - $20 million $10.00 - $12.00 per oz $97
Slide 8: Prudent balance sheet management reduces risk
8 Cash + Short Term Investments(3) //Prudent balance sheet management reduces risk, improves long-term shareholder returns TOTAL WORKING $425.0M CAPITAL $513.1M $826.6M(3) Balance sheet management Total debt(2) of $1,187M related to senior notes, the SL-Credit Facility, and construction loans and le
Slide 9: La Colorada Skarn: large polymetallic deposit
9 ZACATECAS, MEXICO // 100% owned, large, polymetallic deposit with potential for decades of production • Completed over 254,000 metres of drilling; higher-grade mineralised zones continue to be encountered in the drill program • Skarn footprint of 1,500 metres x 1,100 metres, open in all directions
Slide 10: La Colorada ventilation shaft
10 The fully concrete lined 5.5-metre diameter ventilation shaft is expected to be completed in 2023 at a cost of Ventilation fans to be ~$47 million. installed on shaft in 2024, reducing power requirements upon commissioning Shaft sinking reached a depth of 228 metres by end of Q1 2023.
Slide 11: La Colorada Skarn mineral resource estimate
11 ZACATECAS, MEXICO Mining Cut-off Resource Tonnes Zn Pb Ag Zn Pb Ag Method Value Classification (millions) (%) (%) (g/t) (Mt) (Mt) (Moz) (US$/tonne) Indicated 95.9 2.77 1.28 31 2.66 1.23 94.4 Sub-level 45 Caving (SLC) Inferred 147.8 2.29 1.04 28 3.39 1.54 132.9 Notes: 5. Reasonable prospects for e
Slide 12: Skarn mineralisation concentrated in 3 zones
12 // polymetallic skarn mineralisation is concentrated in 3 zones, covering an area of 1,500 metres by 1,100 metres laterally, and a depth of between 600 metres and 1,900 metres below surface
Slide 13: Escobal: one of the world's best silver mines
13 SANTA ROSA, GUATEMALA // One of the world’s best silver mines • High quality, well built operation with over US$500 million invested(1) • One of the world’s largest primary silver deposits with reserves of 264 Moz • 3 consecutive years of production at 20 Moz Ag/year at AISC consistently below US
Slide 14: Escobal ILO 169 consultation process
14 For more information, please visit https://mem.gob.gt/derecho- // Escobal mining license suspended pending completion of an ILO 169 Consultation in Guatemala minero-escobal/ PRE-PHASE 1 PHASE 1 PHASE 2 PHASE 3 REVIEW PRE-CONSULTATION CONSULTATION SUPREME COURT VERIFICATION PAS Guatemala shall wor
Slide 15: The go-to name for investing in silver
15 Large silver reserves(1) As of June 30, 2022, PAAS’ proven and probable mineral reserves of 514.9 Mozs plus measured and indicated mineral resources of 933.0 Mozs As of December 31, 2022, Yamana acquired assets had 112.0 Mozs of proven and probable mineral reserves plus 51.7 Mozs of measured and
Slide 16: NUAG, La Arena II and MARA
16 (NUAG) (Peru) (Argentina) Pan American owns a ~9.3% undiluted Pan American holds a 100% interest in La Pan American holds a 56.25% interest in interest in NUAG, which is advancing Arena II, an undeveloped copper-gold Minera Agua Rica Alumbrera (MARA), a large the Silver Sand and Carangas project
Slide 17: ESG ratings and commitments
17 REPORTING FRAMEWORKS & STANDARDS 68 BBB rating Ranked top 7% in the Metals & Upgraded to ‘BBB’ from ‘BB’ in Mining industry November 2021 Scale: 0 (worst) to 100 (best). Scale: CCC (worst) to AAA (best). MEMBERSHIPS & COMMITMENTS 28.2 (medium risk) C+ rating #8 out of 29 companies in the Upgraded
Slide 18: PAAS Snapshot
18 // PAAS SNAPSHOT 1 $5.6B $0.10 MARKET CAP QUARTERLY DIVIDEND2 364.4M 2.6% Long-life silver reserves SHARES OUTSTANDING DIVIDEND YIELD Medium and long-term growth projects $70.4M 9 DAILY AVERAGE SELL SIDE TRADING VALUE ANALYSTS Committed to best-in-class ESG performance MEMBER OF THE MSCI WORLD AN
Slide 19: Appendix
PAN AMERICAN APPENDIX
Slide 20: Low-cost debt acquired as part of the Yamana transaction
20 // Low-cost debt acquired as part of the Yamana transaction $500 million 2.63% coupon August 2031 S&P long-term issuer rating of BBB- Moody’s rating of Baa3 $283 million 4.625% coupon December 2027 Attractive coupon rates Staggered maturity dates Redeemable at Company’s option 2023 2024 2025 2026
Slide 21: 2023 production and cost guidance by mine
21 Silver Production Gold Production Cash Costs AISC (million ounces) (thousand ounces) ($ per ounce)(1) ($ per ounce) (1) Silver Segment: La Colorada (Mexico) 5.5 – 5.9 3 14.00 – 15.50 17.00 – 18.50 Cerro Moro (Argentina)(2) 3.6 – 3.9 77 – 85 5.50 – 8.80 11.00 – 14.50 Huaron (Peru) 3.6 – 3.8 – 5.80
Slide 22: 2023 capital expenditures guidance
22 Expenditures ($ millions) Sustaining Capital Project capital invested to advance La Colorada (Mexico) 15.0 – 16.0 strategic goals: Cerro Moro (Argentina) 20.0 – 21.0 Huaron (Peru) 17.0 – 18.0 • Continued exploration and in- San Vicente (Bolivia)(1) 3.5 – 4.5 fill drilling on the La Colorada Jacob
Slide 23: ESG structure and accountability
23 // Structure and Accountability S A F E T Y, E N V I R O N M E N TA L AND SOCIAL • The Communities and Sustainable Development (CSD) Committee reviews the Company’s 35% sustainability and ESG performance. • The Health, Safety, and Environment (HSE) Committee provides policy direction and oversigh
Slide 24: Climate change strategy
24 30% reduction in GHG emissions by 2030 and an aspirational objective of net zero by 2050 // Climate Change Strategy • Integrating GHG emission reduction strategies into our operational risk and opportunities assessments and strategic planning • Adapting our operating and non-operating mines to al
Slide 25: Silver supply and demand
25 // 2022 actual(1); in million ounces Photography & Other Mine 3% Recycling Production Industrial Investment2 18% 82% 45% 27% Silver Silver Supply Demand 1,005 1,242 Jewelry & Silverware 1. Source: Silver Institute, April 2023. 25% 2. Net physical investment in coins and bars. ~ 142 Moz supply sho
Slide 26: Silver demand for solar installations
26 // Silver demand for solar installations has grown, representing 140 Moz, or ~11% of total demand, in 2022 while thrifting has plateaued Index (2010=100) Moz 120 160 140 100 120 80 100 60 80 60 40 40 20 20 0 0 2010 2012 2014 2016 2018 2020 2022 Index is based on silver loadings per cell. Fabricat
Slide 27: Growing industrial demand from decarbonization and electrification
27 // Growing industrial demand from global transition to decarbonization and electrification • Silver has the highest electrical and thermal conductivity of all metals, making it an important metal in the transition to a low carbon economy. • ~11% of silver demand is for photovoltaics (solar panels
Slide 28: Timmins: two producing mines in Canadian mining camp
28 ONTARIO, CANADA Timmins West Bell Creek // Two producing mines in prolific Canadian mining camp • 100% owned and operated • Comprises two underground gold mines, Timmins West and Bell Creek, which both feed the Bell Creek mill • Throughput capacity of ~6,000 tpd producing doré • Exploration succe
Slide 29: Dolores (Mexico): large gold/silver mine
29 Dolores CHIHUAHUA, MEXICO // Large gold / silver Mine • 100% owned and operated • Mining is by open pit and uses conventional cyanide heap leaching to produce gold and silver doré • Average throughput capacity of 20,000 tpd Silver & Gold Production Mineral Reserves & Resources Silver (Moz) Gold (
Slide 30: La Colorada: largest silver producing mine
30 La Colorada ZACATECAS, MEXICO // Pan American’s largest silver producing mine • 100% owned and operated underground mine • Expansion completed in 2017 – new mine shaft and sulphide processing plant • Currently producing silver-gold doré bars from a conventional cyanide leach plant for the oxide o
Slide 31: Shahuindo: large gold mine with growth potential
31 CAJAMARCA, PERU Shahuindo // Large gold mine with significant growth potential • 100% owned and operated open pit gold mine producing silver by-products from doré • Average throughput capacity of ~36,000 tpd with heap leach processing • Commercial production began in 2016, significant exploration
Slide 32: La Arena: gold mine with sulphide expansion potential
32 LA LIBERTAD, PERU La Arena // Gold mine with sulphide expansion potential (La Arena II) • 100% owned and operated open pit gold mine producing doré • Run-of-mine heap leach currently processing ~36,000 tpd • Exploration success has extended mine life Gold Production (Koz) Mineral Reserves & Resou
Slide 33: Huaron: polymetallic silver mine
33 PASCO, PERU Huaron // Polymetallic silver mine • 100% owned and operated underground mine • Average throughput capacity of ~2,500 tpd using flotation technology to produce silver in copper, lead, and zinc concentrates Silver Production (Moz) Mineral Reserves & Resources 3.7 Grade Contained Metal
Slide 34: Jacobina: large gold mine with growth potential
34 BAHIA, BRAZIL // Large gold mine with significant growth potential (1) • 100% owned and operated underground gold mine producing doré via a conventional leaching process • Average throughput of ~8,289 tpd during 2022 with the phased expansion to 8,500 tpd completed mid-2022 Gold Production (koz)(
Slide 35: San Vicente: polymetallic silver mine
35 POTOSÍ, BOLIVIA San Vicente // Polymetallic silver mine • 95% owned and operated underground mine • Average throughput capacity of ~950 tpd utilizing a standard flotation process to produce silver-zinc and silver-lead concentrates • Mechanization efforts, enhanced mine dilution controls and impro
Slide 36: El Peñon: large gold/silver mine
36 Dolores ANTOFAGASTA, CHILE // Large gold / silver Mine (1) • 100% owned and operated underground gold and silver mine producing gold and silver doré • The mine has been in operation since 1999 and has consistently replaced ounces mined • Average throughput of ~3,714 tpd in 2022 Silver & Gold Prod
Slide 37: Minera Florida: polymetallic gold mine
37 METROPOLITAN REGION, CHILE // Polymetallic gold mine (1) • 100% owned and operated underground mine producing gold and silver doré bars and zinc concentrate • Average throughput of ~2,649 tpd during 2022 Gold Production (koz)(2) 90 85 82 2020 2021 2022 1. See Yamana’s website and Yamana’s SEDAR p
Slide 38: Cerro Moro: integrated gold and silver mining complex
38 Dolores SANTA CRUZ, ARGENTINA // Integrated gold & silver mining complex (1) • 100% owned and operated open pit and underground gold and silver complex feeding a single processing plant producing gold and silver doré • Average throughput of ~1,074 tpd in 2022 Silver & Gold Production (2) Silver (
Slide 39: MARA: large copper, gold, molybdenum, silver development project
39 CATAMARCA, ARGENTINA // Large copper, gold, molybdenum, silver development project(1) • The MARA project was established in December 2020 following the integration of the Minera Alumbrera plant and mining infrastructure with the Agua Rica deposit • Pan American is the operator with a 56.25% inter
Slide 40: La Arena II: undeveloped copper porphyry
40 LA LIBERTAD, PERU La Arena II // 100% owned, undeveloped copper porphyry Reserves & Resources (as of June 30, 2021) Grade Contained Metal Tonnes Au Cu Au Cu (Mt) (g/t) (%) (koz) (kt) Model Highlights & Key Assumptions M&I Resources 696.3 0.24 0.38 5,280 2,623 Inferred Resources 54.7 0.23 0.29 413
Slide 41: Navidad: one of the largest undeveloped primary silver deposits
41 41 CHUBUT, ARGENTINA // One of the largest undeveloped primary silver deposits Navidad • 100% owned silver project • Project comprises 8 individual mineral deposits in 3 separate mineralized trends • Scalable production profile with high-grade mineralization at surface • Development contingent on
Slide 42: La Colorada Skarn resource at different cut-offs and mining methods
42 ZACATECAS, MEXICO ZACATECAS, MEXICO // Mineral Resource Estimate at Different Cut-off Values and Mining Methods 1. Prices used to report mineral resources were: US$22 Mining Cut-off Classification Tonnes Zn Pb Ag Zn Pb Ag per ounce of silver, US$2,800 per tonne of zinc and US$2,200 per tonne of l
Slide 43: Mineral reserves as of June 30, 2022
43 As of June 30, 2022 (1,2) Silver Segment Huaron Peru Proven 7.0 169 38.1 0.54 38.0 1.51 105.6 2.97 208.2 Probable 3.9 167 21.1 0.30 11.8 1.63 64.2 2.97 116.6 Morococha (92.3%) (3) Peru Proven 3.3 156 16.6 0.44 14.7 1.31 43.3 3.95 130.7 Probable 3.3 158 16.6 0.32 10.6 1.43 46.5 3.78 123.1 La Color
Slide 44: Measured and indicated resources as of June 30, 2022
44 As of June 30, 2022 (1,2) Silver Segment Huaron Peru Measured 2.1 163 10.9 0.42 1.58 3.05 Indicated 2.4 166 12.7 0.40 1.71 2.92 Morococha (92.3%) (3) Peru Measured 0.6 130 2.7 0.64 0.79 2.59 (1) See table below entitled "Metal price Indicated 0.7 124 3.0 0.61 0.74 2.37 assumptions used to estimat
Slide 45: Inferred resources as of June 30, 2022
45 as of June 30, 2022 (1,2) Silver Segment Huaron Peru Inferred 7.2 155 36.1 0.26 1.47 2.73 Morococha (92.3%) (3) Peru Inferred 5.2 143 24.0 0.35 1.28 3.74 La Colorada Mexico Inferred 14.9 195 93.9 0.20 98.4 1.05 1.89 La Colorada Skarn(4) Mexico Inferred 147.8 28 132.9 1.04 2.29 Manantial Espejo Ar
Slide 46: Metal price assumptions for reserves and resources
46 Metal Price Assumptions Used to Estimate Mineral Reserves and Resources as of June 30, 2022 Huaron All categories 19.00 1,300 7,000 2,000 2,600 Morococha All categories 19.00 1,300 7,000 2,000 2,600 La Colorada All categories 19.00 1,300 7,000 2,000 2,600 La Colorada skarn All categories 22.00 2,
Slide 47: Mineral reserves and resources notes
47 Mineral reserves and mineral resources are as defined by the Canadian Institute of Mining, Metallurgy and Petroleum. Pan American reports mineral resources and mineral reserves separately. Reported mineral resources do not include amounts identified as mineral reserves. Mineral resources that are
Slide 48: Investor relations contact
48 Siren Fisekci VP, INVESTOR RELATIONS & CORPORATE COMMUNICATIONS +1.604.806.3191 | ir@panamericansilver.com panamericansilver.com Suite 1440, 625 Howe Street Vancouver, BC, V6C 2T6
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