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Corporate Presentation May 2013
 

Corporate Presentation May 2013

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Corporate Presentation May 2013

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    Corporate Presentation May 2013 Corporate Presentation May 2013 Presentation Transcript

    • Corporate UpdateMay 2013
    • This presentation may contain “forward-looking” statements within the meaning of Canadian securities legislation and the United StatesPrivate Securities Litigation Reform Act of 1995. Forward-looking statements relate to future events or the anticipated performance of theCompany and reflect management’s expectations or beliefs regarding such future events and anticipated performance. In certain cases,forward-looking statements can be identified by the use of words such as “plans”, “expects”, “is expected”, “budget”, “scheduled”,”estimates”, ”forecasts”, ”intends”, ”anticipates” or “believes”, or variations of such words and phrases or statements that certain actions,events or results “may”, ”could”, “would”, ”might”, or “will be taken”, “occur” or “be achieved”, or the negative of these words orcomparable terminology. By their very nature forward-looking statements involve known and unknown risks, uncertainties and other factorswhich may cause the actual performance of the Company to be materially different from any anticipated performance expressed or impliedby the forward-looking statements. Such factors include various risks related to the Company’s operations, including, without limitation,fluctuations in spot and forward markets for gold, silver and other metals, fluctuations in currency markets, changes in national and localgovernments in Mexico and the speculative nature of mineral exploration and development, risks associated with obtaining necessaryexploitation and environmental licenses and permits, and the presence of laws that may impose restrictions on mining. A complete list ofrisk factors are described in the Company’s annual information form and will be detailed from time to time in the Company’s continuousdisclosure, all of which are, or will be available, for review on SEDAR at www.sedar.com.This presentation uses the terms “measured resources”, “indicated resources” and “inferred resources”. The Company advises readers thatalthough these terms are recognized and required by Canadian regulations (under National Instrument 43-101 Standards of Disclosure forMineral Projects (“NI43-101”)), the United States Securities and Exchange Commission does not recognize them. Readers are cautioned notto assume that any part or all of the mineral deposits in these categories will ever be converted in to reserves. In addition, “inferredresources” have a great amount of uncertainty as to their existence, and economic and legal feasibility. It cannot be assumed that all or anypart of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred mineralresources may not form the basis of feasibility or pre-feasibility studies, or economic studies, except for a Preliminary Assessment as definedunder NI43-101. Investors are cautioned not to assume that part or all of an inferred resource exists, or is economically or legally mineable.Although the Company has attempted to identify important factors that could cause actual performance to differ materially from thatdescribed in forward-looking statements, there may be other factors that cause its performance not to be as anticipated. The Companyneither intends nor assumes any obligation to update these forward-looking statements or information to reflect changes in assumptions orcircumstances other than required by applicable law. There can be no assurance that forward-looking statements will prove to be accurate,as actual results and future events could differ materially from those currently anticipated. Accordingly, readers should not place unduereliance on forward-looking statements.Unless otherwise indicated, all dollar values herein are in US$.Cautionary Statement2
    • Who is Primero?3o Emerging Mid-Tier Gold Producero Solid Production Base with Growth Long-life, high-grade producing San Dimas mine Pending Cerro Del Gallo gold-silver project acquistion1o Strong Financial Position Cash and cash flow to internally fund growth Capital available for additional opportunitieso Substantial Exploration Upside at Both Assetso Experienced Management & Boardo Attractive ValuationSee Slide 21 for footnotes.0 400 km
    • $141MBalance SheetMarch 31, 2013CashPromissory note3$141 million$32 millionOwnershipGoldcorpManagement & insidersInstitutional & float32%~2%~66%Capital StructureAt March 31, 2013Shares outstandingFully Diluted4Market Cap. (at May 16, 2013)Shares outstandingFully Diluted4Est. Market Cap.(based on May 16, 2013 closing price)97 million126 million~C$510 million115 million144 million~C$600 millionStrong Cash Balance$120M2Significant Operating Cash FlowConservative Level of Debt$5M Repaymentper year 3Primero Capital StructureSee slide 21 for footnotes. 4Estimated Capital following Cerro Del Gallo Acquisition close~May 25, 2013
    • Primero StrategyGOAL400,000 to 500,000 oz per yearLeader in per share growthAmericas low-risk regions onlyPipeline of growth projects5
    • Building the Primero PipelineSan DimasPlatformSan Dimas2,500 TPDCerro DelGalloSan Dimas3,000 TPD62010-present Q1 2014 2015
    • 1101301652052012A 2013E 2014E 2015EPrimero Cerro Del GalloSan Dimas Cerro Del GalloEstimated Production Profile5,6(Attributable 000 AuEq ounces)6Primero Growth ProfileSee slide 21 for footnotes. 7250at 3,000 TPD
    • Primero Operating ResultsQ1 2013 Q1 2012 2012 2011Mill Throughput7(tonnes per day)2,042 1,962 1,976 1,815Gold equivalentproduction8(gold equivalent ounces)27,656 25,790 111,132 102,224Gold production(ounces)24,190 22,590 87,900 79,564Silver production(million ounces)1.37 1.32 5.13 4.60Gold grade(grams per tonne)4.20 4.05 3.90 3.86Silver grade(grams per tonne)242 242 234 226Cash cost9($ per AuEq ounce)$719 $674 636 640Cash cost9– by-product($ per gold ounce)$589 $532 366 384Capital Expenditures($ million)$8.7 $7.9 39.7 29.824,50025,00025,50026,00026,50027,00027,50028,000Q1 2012 Q1 2013Production(AuEq ounces)Gold Grade(grams per tonne)3.003.504.004.50Q1 2012 Q1 2013+7%+4%8See slide 21 for footnotes.
    • Primero Financial Results(US$ thousands, exceptper share amounts)Q1 2013 Q1 2012 2012 2011Revenues 46,321 44,044 182,939 156,542Income from MineOperations15,706 18,662 79,389 65,090Net income 17,325 30,143 49,553 49,644EPS($ per share)0.18 0.34 0.54 0.56Adjusted netincome10 9,415 18,780 41,292 28,261Adjusted EPS($ per share)100.10 0.21 0.45 0.32Operating cash flowsbefore changes in workingcapital19,309 20,944 88,808 77,591CFPS($ per share)0.20 0.24 0.97 0.889See slide 21 for footnotes.$0.60$0.70$0.80$0.90$1.00$-$0.10$0.20$0.30$0.40$0.50Cash FlowOp CF before changes in working capital ($ per share)+41%+10%2011 20122011 2012Earnings4($ per share)
    • SAN DIMASA Flagship AssetDISTRICT PRODUCED 11M OUNCES OF GOLD AND 600M OUNCES OF SILVEROne of Mexico’s MostSignificant PreciousMetals DepositsSee Slide 21 for footnotes. 10Guidance 2013EGold equivalent production8(gold equivalent ounces)120,000-130,000Gold production(ounces)90,000-100,000Silver production11(million ounces)6.0-6.5Silver sales at spot11(thousand ounces)900-1,000Cash cost9($ per gold equivalent ounce)$620-640Cash cost9– by-product($ per gold ounce)$280-300Capital Expenditures ($ million) $42Exploration ($ million) $15
    • -20040060080031-Dec-11 31-Dec-12Increasing Reserves and Resources and Focusing on Controlling Dilution11Gold Reserves(Thousand Ounces)Indicated Gold Resources(Thousand Ounces)SAN DIMASRich History of Reserve Replacement-20040060080031-Dec-11 31-Dec-12+31%+35%See Slide 21 for footnotes.
    • SAN DIMASExpansion to 2,500 TPD12Total capital expenditure of ~$16.5 millionExpand milling capacity to 2,500 TPDo Install third ball mill, already on-siteo Reconfigure crusherso Install new tailings thickener and pumpsExpand mine throughputo Develop Sinaloa Graben veinso Connect Central Block to Sinaloa Grabeno New mining methodFuture expansion to 3,000 TPD possibleo Dependent on exploration successo Minimal capital and disruption to operation Mill Expansion on-track for:2,500 TPDCAPACITY IN Q1 2014ATTRACTIVE IRR AND PAYBACK PERIODSee Slide 21 for footnotes. 12
    • TAYOLTITA MINEMined 1975 - 2002CENTRAL BLOCK MINEMined 2002 - PresentSAN ANTONIO MINEMined 1987 - 2002Over 120 known veinsCENTRALBLOCKTAYOLTITABLOCKSINALOAGRABENBLOCKWESTBLOCKARANAHANGINGWALLTargetTargetSAN DIMASLarge 22,500 Hectare Land Package13
    • Developmento 19,000 metres of developmento Tunnels joining Sinaloa Graben andCentral Block being completedo Lower level tunnel commenced,expected to be completed in 18-24monthsExplorationo $15.4 million exploration programo 40,000 metres delineation drillingo 34,000 metres exploration drilling,plus 3,800 metres of explorationdriftingo New district exploration programinitiatedSAN DIMAS2013: Focused Exploration & DevelopmentTargeting Vein Extensions from Existing Mines140 1 2 km
    • Located in Prolific Central Corridoro Alexa and Victoria discovered in early 2012,included in 2012 year-end Reserveso Alexa vein continues west of small faulto Victoria confirmed to extend west of SinaloafaultStrategic Underground Drill Locationso Drilling from old El Pilar workings, SinaloaGraben tunnel and east-west drift fromRobertitaSAN DIMASNew Veins Close to InfrastructureAlexa and Victoria Veins Discovered in 2012 and in 2013 Mine Plan1515
    • CERRO DEL GALLOLow Risk Growth Commencing 2015E13INCREASES PRODUCTION BY 60%, DOUBLES RESERVES AND TRIPLES RESOURCES6,13Excellent InfrastructureSee Slide 21 for footnotes. 16Technical DetailsProduction13(Phase I Average Annual)94,600 AuEq. OzCash cost17,18(Excluding Royalties)$650-700 per ounceHeap Leach Grades130.7g/t Au, 14.8g/t Ag, 0.08% CuStrip Ratio130.9:1Phase I Mine Life137.2 yearsTotal Capital Cost Estimate17$165 million2013E Capital Expenditures17$50 millionPotential Phase II CIL Technical Study172015E
    • Measured & Indicated Resources of 3.2Moz of Gold or 5.6Moz of Gold Equivalent 13,14,15See Slide 21 for footnotes.CERRO DEL GALLOLarge Gold Domain17
    • Early stage regional prospectingpreviously returned16:o 1.5m @ 3.40g/t Au and 590g/t Ago 4.6m @ 3.52g/t Au and 428g/t Ago 3.6m @ 1.57g/t Au and 359g/t Ago 4.6m @ 1.91g/t Au and 239g/t Ago 6.0m @ 1.70g/t Au and 243g/t Ago 3.1m @ 1.05g/t Au and 200g/t Ago 7.6m @ 1.51g/t Au and 168g/t AgPotential Exploration TargetsCERRO DEL GALLOExploration Upside Potential18See Slide 21 for footnotes.
    • 192013 2014 2015Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4DetailedEngineeringGeotechnicalPermitting/LandAcquisitionEarth WorksMill TestsAcid GenerationTestsSARTOptimizationPlant & MillConstructionProductionCommissioningCommercialProductionPhase IIFeasibility StudyEstimatedTransactionClosingCERRO DEL GALLOCerro Del Gallo Development Plan19
    • o San Dimas: A Platform for Cash Generationo Cerro Del Gallo Acquisition Scheduled toClose in May 2013o Cash Flow and Capital to Fund AdditionalGrowtho Significant Exploration Potential at San Dimasand Cerro Del Galloo Attractive Valuation on Key MetricsThe Primero Opportunity19A Compelling Investment20
    • Footnotes1. Assuming proposed acquisition of Cerro Del Gallo closes in May 2013 as expected.2. Estimated five-year average after-tax operating cash flow based on production profile discussed in the October 15, 2012 News Release“Primero Announces Expansion of its San Dimas Mine”.3. Goldcorp: 5 year, 6% note repaid $5M/yr with balloon payment at end of 2015. Principal prepayment equal to 50% of Excess Free CashFlow.4. Fully diluted shares include 20.8 million warrants with an exercise price of Cdn$8 per share, expiring on July 20, 2015; and 7.8 millionoptions with an average exercise price of Cdn$5.65.5. “Gold equivalent ounces” include silver and copper production converted to a gold equivalent based on consensus estimatedcommodity prices ; accounts for the San Dimas silver purchase agreement; and uses Cerro Resources publically disclosed productionestimates delayed by 12 months.6. Assumes 100% ownership of Cerro Del Gallo and that it begins production in mid-2015, with full year production estimated at95,000AuEq. Oz in 2016.7. Based on 365 days per year.8. “Gold equivalent ounces” include revenue from silver converted to a gold equivalent based on estimated average realized commodityprices ($1,600 per ounce of gold and $9.41 per ounce of silver in full year 2012, consensus prices thereafter).9. Cash cost is a non-GAAP measure. Refer to the first quarter 2013 MD&A for a reconciliation of cash costs.10. Refer to first quarter 2013 MD&A for adjustments.11. Silver production is subject to a silver purchase agreement. Refer to the first quarter 2013 MD&A for details.12. See October 15, 2012 News Release “Primero Announces Expansion of its San Dimas Mine” for details.13. Cerro Resources Phase I Definitive Feasibility Study as of May 2012.14. As estimated by Cerro Resources using gold, silver and copper price of US$1,341/oz, US$25.58/oz and US$7,582/t (or $3.44/lb)respectively. See Cerro Resources Phase I Definitive Feasibility Study as of May 2012.15. See note 7 in January 23, 2012 News Release “ Primero achieves 2012 Guidance and Provides 2013 Outlook.16. As reported by Cerro Resources in November 16,2012 Investor Presentation:http://www.cerroresources.com/index.cfm/investor/presentations1/17. Based on Cerro Resources Phase I Definitive Feasibility Study as of May 2012 and preliminary estimates calculated internally by Primeroas of May 2013.18. The Cerro del Gallo mine is subject to a 4% Net Smelter Return (NSR) royalty.21
    • Appendices
    • Primero sells 50% of annual silver production above 3.5 million ounces at spoto Remainder sold at ~$4 per ounce under silver purchase agreemento Threshold commences August 6 to following August 5o Threshold increases to 6.0 million ounces on August 6, 2014o Planned expansion anticipated to generate similar silver sales at spot as 2012 postAugust 6, 2014Recent Tax Ruling Created Positive Leverage to Silver25%75%Silver as Percentage of 2013E RevenueSilver GoldSAN DIMASPositive Leverage to Silver23
    • Favorable HorizonMineralization – Ore Bodies Extension of the Favorable HorizonPotential0 1 2K I L O M E T E R SSW NE3,000 m.2,000 m.1,000 m.3,000 m.2,000 m.1,000 m.Source: San Dimas Geology OfficeIntrusiveFaultsWest Block2013 EXPLORATIONSan AntonioMined 1987-2002Central BlockMined 2002-CurrentTayoltita BlockMined 1975-2002AranaHanging WallSinaloa GrabenMined 2012-Current2013 EXPLORATION PROGRAMDRILLING FOR EXTENSIONS OF KNOWN VEINSSAN DIMASDistrict Wide Exploration PotentialLongitudinal Cross Section24
    • Joseph F. Conway | President & C.E.O.1o Former CEO, President and Director of IAMGOLDfrom 2003 to 2010o Former President, CEO and Director of RepadreCapital from 1995 to 2003Renaud Adams | C.O.O.o Former SVP, American Operations for IAMGOLDo Former General Manager of Rosebel Gold Mine2007 to 2010o Former General Manager El Toqui Mine in Chileand then the El Mochito Mine in HondurasDavid Blaiklock | C.F.O.o Former controller IntraWesto Previously controller for a number of public andprivate companies in real estate developmentDavid Sandison | VP, Corporate Developmento Former VP, Corporate Development ofClarity Capital ; Director, Corporate DevelopmentXstrata Zinc Canada ; Director Business Development,Noranda/Falconbridge;;Former EVP, Noranda ChileGabriel Voicu | VP, Geology and Explorationo 25 Years of mining experience, formerly held seniortechnical and exploration positions with Cambiorand IamgoldBoard Committees: 1.Health, Safety and EnvironmentTamara Brown | VP, Investor Relationso Former Director Investor Relations for IAMGOLD;Partner of a Toronto based, boutique investmentbank; Professional engineer in mining industryH. Maura Lendon | VP, Chief General Counsel andCorporate Secretaryo Former Senior Vice President, Chief Legal Officerand Corporate Secretary of HudBay Minerals Inc.;Chief Counsel Canada, Chief Privacy Officer -Canada of AT&TExecutive Management25
    • Board of DirectorsBoard Committees:1.Health, Safety and Environment2. Human Resources and Compensation3. Governance and Nominating4. Lead Director 5. AuditWade Nesmith | Chairmano Founder of Primeroo Founding and current directorof Silver WheatonJoseph Conway | Director1see Executive ManagementDavid Demers | Director2,3,4,5o Founder, CEO and DirectorWestport Innovationso Director of Cummins Westportand Juniper EnginesGrant Edey | Director 3,5o President & CEO, KhanResources Inc.o Former Director of BreakwaterResources, former director ofQueenstake Resources, SantaCruz Goldo Former CFO, IAMGOLDRohan Hazelton | Director 1,5o VP, Strategy, Goldcorpo Formerly with Wheaton Riverand Deloitte & Touche LLPTimo Jauristo | Director 2o EVP, Corporate Development,Goldcorpo Former CEO of Zincore MetalsInc. and SouthwesternResources Corp.Eduardo Luna | Director 1o Former EVP & President,Mexico. Former Chairman andCEO of Silver Wheaton,Executive VP of Goldcorp andLuismin S.A. de C.V. (San Dimas)and President of MexicanMining Chamber and the SilverInstituteRobert Quartermain | Director 2,3o Founder and President & CEO,Pretivm Resourceso Former President, Silver Standardo Director of Vista Gold Corp.and Canplats ResourcesMichael Riley | Director 5o Chartered accountant with morethan 26 years of accountingexperienceo Chair of Primero Audit Committee,Chair of Audit Committee of B.C.Lottery Corporation and member ofthe Audit Committee of CanalaskaUranium Ltd.26
    • SAN DIMASMineral Resources and Mineral Reserves(DECEMBER 31, 2012, MINERAL RESOURCES INCLUDE MINERAL RESERVES)Classification Tonnage(million tonnes)Gold Grade (g/t) Silver Grade(g/ t)Contained Gold(000 ounces)Contained Silver(000 ounces)Mineral ReservesProbable 4.579 4.5 267 660 39,377Mineral ResourcesIndicated 3.748 6.5 389 780 46,877Inferred 6.144 3.9 327 762 64,637Notes to Mineral Reserve Statement:1. Cutoff grade of 2.4 grams per tonne (”g/t”) gold equivalent (“AuEq”) based on total operating cost of US$104.73/t. Metal prices assumed are gold US$1,400per troy ounce and silver US$25 per troy ounce. Silver supply contract obligations have been referenced in determining overall vein reserve estimate viability.2. Processing recovery factors for gold and silver of 97% and 94% assumed.3. Exchange rate assumed is 13 pesos/US$1.00.4. The Mineral Reserve estimates were prepared by Mr. Herbert A. Smith P.Eng. of AMC Mining Consultants (Canada) Ltd. and a QP for the purposes of NationalInstrument 43-101 (“NI 43-101”).Notes to Mineral Resource Statement:1. Mineral Resources are total and include those resources converted to Mineral Reserves.2. A 2.0g/t Au Eq cutoff grade is applied and the AuEq is calculated at a gold price of US$1,625 per troy ounce and a silver price of US$25 per troy ounce.3. A constant bulk density of 2.7 tonnes/m3 has been used.4. The Mineral Resource estimates were prepared by Mr. Rodney Webster MAusIMM, MAIG and Mr. J. Morton Shannon P.Geo., both of AMC MiningConsultants (Canada) Ltd. and a QP for the purposes of NI 43-101.Additional exploration potential estimated at 6-10 million tonnes at grade ranges of 3-5 grams per tonne of gold and 200-400 grams pertonne of silver.It should be noted that these targets are conceptual in nature. There has been insufficient exploration to define an associated MineralResource and it is uncertain if further exploration will result in the target being delineated as a Mineral Resource.27
    • CategoryM Tonnes Au Au Ag Ag Cu Cu Au Eq AuEq(g/t) (M ozs) (g/t) (M ozs) (%) (M lbs) (g/t) (M oz)Proven 28.2 0.71 0.64 15.1 13.7 0.08 50.2 1.15 1.05Probable 4.0 0.54 0.07 13.2 1.7 0.07 6.2 0.93 0.12Proven & Probable 32.2 0.69 0.71 14.8 15.3 0.08 56.4 1.14 1.18CategoryM Tonnes Au Au Ag Ag Cu Cu Au Eq AuEq(g/t) (M ozs) (g/t) (M ozs) (%) (M lbs) (g/t) (M oz)Measured 39.9 0.61 0.78 13.8 17.71 0.10 88.8 1.07 1.37Indicated 8.0 0.55 0.14 11.0 2.83 0.08 14.6 0.92 0.24Measured & Indicated 47.9 0.60 0.92 13.3 20.55 0.1 103.4 1.06 1.64Total Resources Within the Gold Domain2Phase I Heap Leach In-Pit Proven and Probable Reserves3In-Pit Resources (excluding Proven and Probable Reserves)4,5CategoryM Tonnes Au Au Ag Ag Cu Cu Au Eq AuEq(g/t) (M ozs) (g/t) (M ozs) (%) (M lbs) (g/t) (M oz)Measured 129 0.54 2.24 12.0 49.8 0.09 256.0 0.94 3.91Indicated 80 0.38 0.98 8.0 20.6 0.08 141.1 0.69 1.77Measured & Indicated 209 0.48 3.22 11.0 70.3 0.08 396.9 0.83 5.58Inferred 20 0.3 0.19 7.0 4.5 0.09 39.7 0.59 0.38CERRO DEL GALLOReserves and In-Pit Resources1281. “Technical Report First Stage Heap Leach Feasibility Study, Cerro del Gallo Gold Silver Project, Guanajuato, Mexico” June 2012 (“Feasibility Study”). Goldequivalent ounces calculated by Cerro Resources using gold, silver and copper prices of US$1,341/oz, US$25.58/oz and US$7,582/t respectively.2. These resources are reported using internal cut-off grade of 0.2 g/tAu as per Feasibility Study, 2012 and Golder Associates Technical Report, 2008.3. These reserves are reported using internal cut-off grades of 0.24 and 0.29 gAuEq/t for weathered and partially oxidized, respectively.4. These resources are reported using internal cut-off grades of 0.24, 0.29, and 0.34 gAuEq/t for weathered, partially oxidized, and fresh material resp.5. See note 7 in January 23, 2013 News Release “Primero achieves 2012 Guidance and Provides 2013 Outlook”.
    • Cerro Resources NL (“Cerro”) has filed a technical report under National Instrument 43-101 - Standards of Disclosure for MineralProjects (“NI 43-101”) entitled “Technical Report, First Stage Heap Leach Feasibility Study, Cerro del Gallo Gold Silver Project,Guanajuato, Mexico” (the “Technical Report”) with an effective date of May 11, 2012. Mr. Gabriel Voicu P.Geo, Vice President,Geology and Exploration, Primero, who is a “qualified person” for the purposes of NI 43-101, has reviewed the Technical Report onbehalf of Primero. To the best of Primero’s knowledge, information and belief, there is no new material scientific or technicalinformation that would make the Technical Report inaccurate or misleading. Primero plans to file a technical report on the CerroDel Gallo project within 180 days of December 13, 2012 in accordance with the requirements of NI 43-101.Cautionary Note to US Investors Regarding Mineral Reporting Standards:Primero prepares its disclosure in accordance with the requirements of securities laws in effect in Canada, which differ from therequirements of US securities laws. Terms relating to mineral resources and mineral reserves in this material change report andother documents referenced herein are defined in accordance with NI 43-101 under the guidelines set out in the CanadianInstitute of Mining, Metallurgy, and Petroleum Standards on Mineral Resources and Mineral Reserves. The Securities and ExchangeCommission (the “SEC”) permits mining companies, in their filings with the SEC, to disclose only those mineral deposits that acompany can economically and legally extract or produce. Primero uses certain terms, such as, “measured mineral resources”,“indicated mineral resources”, “inferred mineral resources” and “probable mineral reserves”, that the SEC does not recognize(these terms may be used in this presentation and other documents referenced herein and are included in the public filings ofPrimero which have been filed with securities commissions or similar authorities in Canada).29CERRO DEL GALLOCautionary Statement on Cerro Del Gallo
    • Notes to Investors Regarding the Use of ResourcesThis presentation has been prepared in accordance with the requirements of Canadian provincial securities laws which differ from the requirements of U.S.securities laws. Unless otherwise indicated, all mineral reserve and resource estimates included in this presentation have been prepared in accordancewith Canadian National Instrument 43-101 Standards of Disclosure for Mineral Projects (“NI 43-101”) and the Canadian Institute of Mining, Metallurgy andPetroleum classification systems. NI 43-101 is a rule developed by the Canadian Securities Administrators that establishes standards for all public disclosurean issuer makes of scientific and technical information concerning mineral projects. These standards differ significantly from the requirements of the UnitedStates Securities and Exchange Commission (the “SEC”), and reserve and resource estimates disclosed in this presentation may not be comparable to similarinformation disclosed by U.S. companies.The mineral reserve estimates in this presentation have been calculated in accordance with NI 43-101, as required by Canadian securities regulatoryauthorities. For United States reporting purposes, SEC Industry Guide 7 under the United States Securities Exchange Act of 1934, as amended, asinterpreted by Staff of the SEC, applies different standards in order to classify mineralization as a reserve. As a result, the definition of “probable reserves”used in NI 43-101 differs from the definition in the SEC Industry Guide 7. Under SEC standards, mineralization may not be classified as a “reserve” unlessthe determination has been made that the mineralization could be economically and legally produced or extracted at the time the reserve determination ismade. Among other things, all necessary permits would be required to be in hand or issuance imminent in order to classify mineralized material as reservesunder the SEC standards. Accordingly, mineral reserve estimates contained in this presentation may not qualify as “reserves” under SEC standards.In addition, this presentation uses the terms “indicated resources” and “inferred resources” to comply with the reporting standards in Canada. TheCompany advises United States investors that while those terms are recognized and required by Canadian regulations, the SEC does not recognize them.United States investors are cautioned not to assume that any part or all of the mineral deposits in these categories will ever be converted into mineralreserves. Further, “inferred resources” have a great amount of uncertainty as to their existence and as to whether they can be mined legally oreconomically. Therefore, United States investors are also cautioned not to assume that all or any part of the “inferred resources” exist. In accordance withCanadian securities laws, estimates of “inferred resources” cannot form the basis of feasibility or other economic studies. It cannot be assumed that all orany part of “indicated resources” or “inferred resources” will ever be upgraded to a higher category or are economically or legally mineable. In addition,disclosure of “contained ounces” is permitted disclosure under Canadian securities laws; however, the SEC only permits issuers to report mineralization asin place tonnage and grade without reference to unit measures.NI 43-101 also permits the inclusion of disclosure regarding the potential quantity and grade, expressed as ranges, of a target for further explorationprovided that the disclosure (i) states with equal prominence that the potential quantity and grade is conceptual in nature, that there has been insufficientexploration to define a mineral resource and that it is uncertain if further exploration will result in the target being delineated as a mineral resources, and(ii) states the basis on which the disclosed potential quantity and grade has been determined. Disclosure regarding exploration potential has been includedin this presentation. United States investors are cautioned that disclosure of such exploration potential is conceptual in nature by definition and there is noassurance that exploration will result in any category of NI 43-101 mineral resources being identified.30
    • Notes
    • Tamara BrownVice President, Investor RelationsT 416 814 3168info@primeromining.comTrading SymbolsCommon Shares TSX:P, NYSE:PPPWarrants TSX:P.WTPRIMERO MINING CORP.20 Queen Street West, Suite 2301Toronto, ON M5H 3R3T 416 814 3160 F 416 814 3170TF 877 619 3160www.primeromining.com