Pan American Silver Corp. · TSX:PAAS
Pan American Silver — Investor Presentation (February 2023)
43 slides from Pan American Silver's investor presentation, February 2023
Slide 1: Investor Presentation February 2023
INVESTOR PRESENTATION // FEBRUARY 2023
Slide 2: Forward-looking statements and non-GAAP measures
2 timing for the same, and any anticipated benefits therefrom; the timing for any for gold, silver and other metals; future anticipated prices for gold, silver and future guidance related to production, AISC, operating and sustaining costs, or other metals and assumed foreign exchange rates; the tim
Slide 3: Forward-looking statements continued
3 CONTINUED information, changes in assumptions, future events or otherwise, except to the U.S. companies. In particular, and without limiting the generality of the extent required by applicable law. foregoing, this presentation uses the terms “measured resources,” “indicated Such factors include, w
Slide 4: Yamana transaction terms
4 • Total consideration of US$4.8 billion or US$5.02 per Yamana share (as of Nov. 4, 2022 announcement of binding proposal) • Comprised of US$1.0 billion in cash funded by Agnico Eagle, ~36.1 million Agnico Eagle shares and up to ~156.9 million Pan American shares • Pan American is the purchaser of
Slide 5: Pro forma assets in the Americas
CANADA Timmins 5 Dolores // Pan American has the scale & experience to capture value La Colorada Skarn Deposit opportunities in the Americas, where we have been operating for MEXICO GUATEMALA nearly 3 decades Escobal (C&M) • 4 producing mines(1): Jacobina, El Peñón, Minera Florida & Pan American Ass
Slide 6: Production increases and growth projects
6 // Assets to be acquired through Yamana Transaction have a long history of reserve replacement & an extensive exploration portfolio • Production increases on a pro forma basis for 2022: • Annual silver production would have increased by ~50%(1) • Annual gold production would have increased by ~102
Slide 7: The go-to name for investing in silver
7 // The “go-to” name for investing in silver Large silver reserves(1) • PAAS’ proven and probable mineral reserves 514.9M ozs plus measured and indicated mineral resources of 933.0M ozs • As of Dec. 31, 2021, Yamana had 111.0M ozs of proven and probable mineral reserves plus 50.9M ozs of measured a
Slide 8: Growth and capital returns to shareholders
8 // Supports investment in growth & capital returns to shareholders Accretive per share to key financial Opportunity to capture synergies and operating metrics, even before estimated between $40-$60M annually considering synergies through operational efficiencies from the combined LATAM portfolios,
Slide 9: Prudent balance sheet management
9 Cash & Short-term investments $142.3M TOTAL //Prudent balance sheet management reduces risk, AVAILABLE improves long-term shareholder returns LIQUIDITY(1) $482.3M √ Total debt(2) of $226.8M as at December 31, 2022, related to Sustainability-Linked Revolving Credit Facility, lease liabilities & con
Slide 10: La Colorada Skarn polymetallic deposit
10 ZACATECAS, MEXICO // 100% owned, large, polymetallic deposit with potential for decades of production • Over 240,000 metres drilled since discovery in October 2018; only 80% of metres used in the updated resource provided on September 14, 2022 • Skarn footprint of 1,500 metres x 1,100 metres, ope
Slide 11: La Colorada ventilation shaft
11 The fully concrete lined 5.5-metre diameter and 560-metre deep ventilation shaft is expected to be completed in 2023 at a cost of approximately $47 million. Ventilation fans to be installed on shaft in 2024, reducing power requirements upon commissioning In 2022, shaft sinking initiated and advan
Slide 12: La Colorada Skarn mineral resource
12 ZACATECAS, MEXICO Mining Cut-off Resource Tonnes Zn Pb Ag Zn Pb Ag Method Value Classification (millions) (%) (%) (g/t) (Mt) (Mt) (Moz) (US$/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 13: Mineral resource at different cut-off values
13 ZACATECAS, MEXICO // Mineral Resource Estimate at Different Cut-off Values and Mining Methods 1. Prices used to report mineral resources were: US$22 per ounce of silver, US$2,800 per tonne of zinc and US$2,200 per tonne of lead. Mining Cut-off Value Classification Tonnes Zn Pb Ag Zn Pb Ag 2. An e
Slide 14: Skarn mineralisation zones
14 ZACATECAS, MEXICO // 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 15: One of the world's best silver mines (Escobal)
15 SANTA ROSA, GUATEMALA // One of the world’s best silver mines • High quality, well built operation with over US$500 million invested1 • 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$1
Slide 16: Escobal ILO 169 consultation process
16 // Escobal mining license suspended pending completion of an ILO 169 Consultation in Guatemala. For more information visit: https://mem.gob.gt/pueblo-indigena-xinka/ PRE-PHASE 1 PHASE 1 PHASE 2 PHASE 3 REVIEW PRE-CONSULTATION CONSULTATION SUPREME COURT VERIFICATION PAS Guatemala shall work Minist
Slide 17: Other investments and exploration projects
17 (NUAG) (Peru) (Mexico) Pan American owns a ~9.4% undiluted Pan American holds a 100% interest JV agreement with Radius Gold: Pan interest in NUAG, which is advancing the in La Arena II, an undeveloped American holds a 65% interest in the Amalia Silver Sands and Carangas exploration copper-gold pr
Slide 18: ESG ratings and rankings
18 Reporting Frameworks and Standards Ratings and Rankings (as of February 21, 2023) 68 BBB rating Ranked top 7% in the Metals & Upgraded to ‘BBB’ from ‘BB’ in Mining industry November 2021 Memberships and Commitments Scale: 0 (worst) to 100 (best). Scale: CCC (worst) to AAA (best). 25.9 (medium ris
Slide 19: PAAS snapshot
19 // PAAS SNAPSHOT 1 ~$3.3B $0.10 MARKET CAP QUARTERLY DIVIDEND2 210.7M 2.5% Long-life silver reserves and major catalysts SHARES OUTSTANDING DIVIDEND YIELD for silver growth 3.7M 10 Commitment to best-in-class ESG 3-MONTH DAILY AVERAGE SHARES SELL SIDE ANALYSTS performance MEMBER OF THE MSCI WORLD
Slide 20: Appendix
PAN AMERICAN APPENDIX
Slide 21: Q4 2022 highlights
21 NASDAQ: PAAS // TSX: PAAS Announced transaction to acquire Revenue of $375.5M excludes Yamana Gold with related expenses approximately $45M to $50M of impacting earnings and cash flow finished goods inventory build-ups Silver production of 4.8 Moz and gold Strong financial position with total pro
Slide 22: 2022 cash flow bridge
22 Sustaining Cash Flow Performance Growth, Business Development, and Other $800 $418 $9 $750 $700 $650 $600 $550 $500 ($224) $450 $400 Millions $335 ($138) $350 $300 $263 $9 $3 ($95) $250 ($42) $200 ($71) $142 $150 ($45) $100 ($16) $50 $0 Cash and STI Adjusted Net other Sustaining Net income Divide
Slide 23: ESG structure and accountability
23 // Structure and Accountability 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. 15% • The Health, Safety, and Environment (HSE) Committee provides policy direction and oversight of SAFE
Slide 24: Climate change strategy
24 // Climate Change Strategy // 30% reduction in GHG emissions by 2030 and an aspirational objective of net zero by 2050 • Integrating GHG emission reduction strategies into our operational risk and opportunities assessments and strategic planning • Adapting our operating and non-operating mines to
Slide 25: ESG ratings history
25 // As of December 31, 2022 S&P Global 0 (worst) to 100 (best) 23 46 56 68 94 MSCI CCC (worst) to AAA (best) BB BB BBB BBB ~43 Sustainalytics 0 (best) to 100 (worst) 44.0 35.6 31.0 27.3 82 (SEVERE RISK) (HIGH RISK) (HIGH RISK) (MEDIUM RISK) 1 (higher disclosure) to E 10 (lower disclosure) - 5 3 4
Slide 26: Silver supply and demand
26 // 2022 estimate(1); in million ounces Mine Photography & Industrial Recycling Production Other Investment2 45% 18% 82% 3% 27% Silver Silver Supply Demand 1,017 1,210 Jewelry & Silverware 25% ~ 194 Moz supply shortfall estimated for 2022 1. Source: Silver Institute, Nov. 18, 2022. 2. Net physical
Slide 27: Silver demand for solar installations
27 // Continued growth in silver demand for solar installations Index is based on silver loadings per cell Source: Metals Focus, EPIA, December 2022
Slide 28: Industrial demand from decarbonization and electrification
28 // 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 supply used for photovoltaics (solar pane
Slide 29: La Colorada mine
29 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 30: Dolores mine
30 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 31: Huaron mine
31 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 32: San Vicente mine
32 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 33: Shahuindo mine
33 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 34: La Arena mine
34 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 35: Timmins West and Bell Creek
35 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 36: La Arena II copper porphyry
36 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) M&I Resources 696.3 0.24 0.38 5,280 2,623 Inferred Resources 54.7 0.23 0.29 413 159 Model Highlights & Key Assumpt
Slide 37: Navidad silver project
37 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 pr
Slide 38: Mineral reserves as of June 30, 2022
38 Pan American Silver Corporation Mineral Reserves as of June 30, 2022 (1,2) Tonnes Contained Ag Contained Au Contained Cu Contained Pb Contained Zn Property Location Classification Ag (g/t) Au (g/t) Cu (%) Pb (%) Zn (%) (Mt) (Moz) (koz) (kt) (kt) (kt) Silver Segment Huaron Peru Proven 7.0 169 38.1
Slide 39: Measured and indicated mineral resources
39 Pan American Silver Corporation Measured and Indicated Mineral Resources as of June 30, 2022 (1,2) Contained Ag Contained Au Property Location Classification Tonnes (Mt) Ag (g/t) Au (g/t) Cu (%) Pb (%) Zn (%) (Moz) (koz) Silver Segment Huaron Peru Measured 2.1 163 10.9 0.42 1.58 3.05 Indicated 2.
Slide 40: Inferred mineral resources
Pan American Silver Corporation Inferred Mineral Resources as of June 30, 2022 (1,2) 40 Property Location Classification Tonnes (Mt) Ag (g/t) Contained Ag (Moz) Au (g/t) Contained Au (koz) Cu (%) Pb (%) Zn (%) Silver Segment Huaron Peru Inferred 7.2 155 36.1 0.26 1.47 2.73 Morococha (92.3%) (3) Peru
Slide 41: Metal price assumptions for reserves and resources
41 Metal Price Assumptions Used to Estimate Mineral Reserves and Resources as of June 30, 2022 Mine Category Ag US$/oz Au US$/oz Cu US$/t Pb US$/t Zn US$/t 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 1,30
Slide 42: Technical information and qualified persons
42 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 43: Investor relations contact
43 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
Pan American Silver — Investor Presentation (February 2023) on 6ix