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2011 – Focused on Growth                           TSX:PMarch 2011
Cautionary Statement                                                                                                      ...
Investment Highlights            TSX:P                        San Dimas                        Gold-Silver Mine           ...
2010 Results                                                                                                              ...
Corporate Strategy                                                                               TSX:PGROWTH              ...
Strong Financial Position  Solid Platform for Growth                                                                      ...
Financial Results      First Full Quarter of Production Generated a Profit                                                ...
San Dimas Quarterly Improvement          Increased Throughput                                                             ...
2011 - Focused on Growth                                                                                                  ...
Improved Silver Agreement          Increased Revenue, Reduced Costs                                              Term     ...
Improved Silver Agreement          Quarterly Volatility, Tax Impact Remain        Tax Impact                              ...
San Dimas   TSX:P
San DimasSolid Platform with expansion & exploration potential                                                            ...
Record Reserves & ResourcesAnd Promising Exploration                                                       TSX:P  Grew Gol...
San Dimas Growth Profile        Cash Flow Funded                                                                          ...
Optimization & Expansion                                        TSX:PINCREASE MINE DEVELOPMENTKey to production growthOPER...
Sinaloa Graben Key to Growth                                                   TSX:P Sinaloa Graben million ounce resource...
2011 Main Development & Targets                                           TSX:P                                           ...
San Dimas              Higher Grade Sinaloa Graben DDH     Ag g/t Au g/t mRO-16-02 132RO-20-05 514                3.27    ...
The Value Proposition
Superior Production & CFPS Growth                                                                                         ...
2011 Objectives                  TSX:P12345678                          22
APPENDICES
Transaction Overview                                                                                                     T...
Strong Management & Board                                                               TSX:PWade Nesmith | Executive Chai...
District Wide Upside – Long Section                                                                                    TSX...
Sinaloa GrabenHigher Grade and Wider Widths               Sinaloa Graben Tunnel: Julieta - Sinaloa Norte vein (San Salvado...
PRIMERO MINING CORP.Richmond Adelaide Centre120 Adelaide Street West, Suite 1202Toronto, ON M5H 1T1T 416 814 3160 F 416 81...
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Primero Corporate Presentation March 2011

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Primero Corporate Presentation March 2011

  1. 1. 2011 – Focused on Growth TSX:PMarch 2011
  2. 2. Cautionary Statement TSX:PThis presentation may contain “forward-looking” statements within the meaning of Canadian securities legislation and the United States Private SecuritiesLitigation Reform Act of 1995. Forward-looking statements relate to future events or the anticipated performance of the Company and reflectmanagement’s expectations or beliefs regarding such future events and anticipated performance. In certain cases, forward-looking statements can beidentified 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 betaken”, “occur” or “be achieved”, or the negative of these words or comparable terminology. By their very nature forward-looking statements involveknown and unknown risks, uncertainties and other factors which may cause the actual performance of the Company to be materially different from anyanticipated performance expressed or implied by 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 innational and local governments 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 of risk factors aredescribed in the Company’s preliminary prospectus and will be detailed from time to time in the Company’s interim and annual financial statements andmanagement’s discussion and analysis of those statements, 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 that although theseterms are recognized and required by Canadian regulations (under National Instrument 43-101 Standards of Disclosure for Mineral Projects (“NI43-101”)),the United States Securities and Exchange Commission does not recognize them. Readers are cautioned not to assume that any part or all of the mineraldeposits in these categories will ever be converted in to reserves. In addition, “inferred resources” have a great amount of uncertainty as to their existence,and economic and legal feasibility. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category.Under Canadian rules, estimates of inferred mineral resources may not form the basis of feasibility or pre-feasibility studies, or economic studies, except fora Preliminary Assessment as defined under NI43-101. Investors are cautioned not to assume that part or all of an inferred resource exists, or is economicallyor legally mineable.Although the Company has attempted to identify important factors that could cause actual performance to differ materially from that described in forward-looking statements, there may be other factors that cause its performance not to be as anticipated. The Company neither intends nor assumes anyobligation to update these forward-looking statements or information to reflect changes in assumptions or circumstances other than required by applicablelaw. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially fromthose currently anticipated. Accordingly, readers should not place undue reliance on forward-looking statements.Unless otherwise indicated, all dollar values herein are in US$. 2
  3. 3. Investment Highlights TSX:P San Dimas Gold-Silver Mine DURANGO MEXICO 3
  4. 4. 2010 Results TSX:P123456781. Primero raised $285 million on July 20, 2010, currency exchange fluctuation resulted in $292 million in proceeds being delivered on August 6, 2010 4
  5. 5. Corporate Strategy TSX:PGROWTH TARGETED GROWTH OBJECTIVE Gold Eq. ounces (000) LEADING MID-TIER Double San Dimas production by 2013 400 GOLD PRODUCER 2011 gold reserves: 1 million ounces 2011 production: 15% increase LATIN AMERICAN ACQUISITIONS 300LOW COST Below industry average cash costs: trending SAN DIMAS ACQUISITIONS below $450 per ounce by 2013 OPTIMIZATION 200 EXPLORATIONLOW RISK OPTIMIZATION Maintain balance sheet strength Un-hedged gold 100 SAN DIMAS (GOLD EQUIVALENT OUNCES) Americas pro-mining jurisdictions only Commitment to leading CSR programs 0 2010 2011E 2012E 2013E 5
  6. 6. Strong Financial Position Solid Platform for Growth TSX:P $58 Increased Exchange TSX:P million Cash Balance BALANCE SHEET at Dec 31, 2010 Cash $58 million Promissory note1 $50 million Convertible note2 $60 million $50-70 Strong OWNERSHIP million3 Operating Cash Flow Goldcorp 36% Management & insiders ~3% Institutional & float ~61% $5 Prudent million CAPITAL STRUCTURE repayment per Level Of Debt Shares outstanding 88 million year Fully Diluted 117 million1. Goldcorp: 5 year, 6% note repaid $5M/yr with balloon payment at end of year 52. Goldcorp: 1 year, rolling, 3% note convertible at CDN$63. Estimated after-tax cash flow for 2011/2012 based on Primero’s three-year plan. 6
  7. 7. Financial Results First Full Quarter of Production Generated a Profit TSX:P (US$ thousands, except per share amounts) Q4 2010 Q4 2009 2010 2009 Revenues 41,425 - 60,278 - Earnings from Operations 13,250 - 14,145 - Net earnings 1,827 (333) (34,487) (783) Earnings (loss) per share 0.02 (0.11) (0.93) (0.36) 1 Adjusted net earnings (loss) 3,069 (333) (7,357) (783) 1 Adjusted earnings (loss) per (0.11) (0.20) (0.36) 0.03 share Operating cash flow before 1 14,044 (318) 11,697 (660) working capital changes1. Adjusted net earnings, adjusted net earnings per share and operating cash flow before working capital changes are non-GAAP measures. Refer to the 2010 fourth quarter MD&A for a reconciliationto GAAP. 7
  8. 8. San Dimas Quarterly Improvement Increased Throughput TSX:P 1 Q4 2010 Q3 2010 Throughput 14% 1,840 1,578 (tonnes per day) Gold equivalent production 24,800 21,800 (gold equivalent ounces) Gold production 21,200 18,400 (ounces) Silver production 1.21 1.01 (million ounces) Gold grade 4.01 4.03 (grams per tonne) Silver grade 236 227 (grams per tonne) $8 2 Cash cost $645 $653 ($ per gold equivalent ounce) 2 Cash cost – by-product $524 $552 ($ per gold ounce)1. The San Dimas mine was acquired by Primero on August 6, 2010. The comparative operating data (excluding cash costs) was as reported during the period the mine was owned by Goldcorp Inc.2 .Cash cost is a non-GAAP measure. Refer to the 2010 fourth quarter MD&A for a reconciliation of cash costs to operating expenses. 8
  9. 9. 2011 - Focused on Growth TSX:P 3 2010 2011E Production: 15% increase Gold equivalent production 110,000 100,300 (gold equivalent ounces) -120,000 Targeting gold reserves: 1 million oz Gold production 90,000- 85,400 Targeting throughput of 1,900 tpd (ounces) 100,000 Silver production 4.53 4.5-5.0 (million ounces) Grades expected to increase Gold grade 4.46 4.8 (grams per tonne) Development up 50%: Silver grade 244 250  $11.4 million or 8,900 metres (grams per tonne) 1 Cash cost – gold equivalent $550- Exploration doubled to $12 million: ($ per gold equivalent ounce) $584 $570  54,000 metres diamond drilling – 30% more Cash cost 1,2 – by-product $350- than 2010 levels $471 ($ per gold ounce) $370  3,800 metres exploration drifting – Ten-fold Capital Expenditures increase over 2010 levels $26 $31 (millions)1. Cash cost is a non-GAAP measure.2. Cash costs (by-product) per gold ounce reported for San Dimas by Goldcorp Inc. are not comparable to Primero cash cost numbers due to certain inter-company transactions that are reversed for Goldcorp Inc.’s consolidated reporting.3. 2011 forecasts assume an average gold price of $1,400 per ounce; an average silver price of $6.63 per ounce, as according to the silver purchase agreement the first 3.5 million ounces and 50% of the excess of silver are sold at $4.04 per 9ounce and the balance is sold at spot, which is assumed to be $24 per ounce.
  10. 10. Improved Silver Agreement Increased Revenue, Reduced Costs Term Production 25 yearsOld Agreement (19 remained) 100% of silver production sold at $4Revised Agreement Life of Mine First 4 years: First 3.5 million oz plus 50% of excess each year sold at $4Anniversary: Aug 6 Goldcorp sells Silver Wheaton an additional 1.5 million oz each year 50% of production above 3.5 million oz each year sold by Primero at spot Year 5+: First 6.0 million ounces plus 50% of excess each year sold at $4 50% of production above 6.0 million oz each year sold by Primero at spot Increases Revenue1 Decreases Cash Costs11. BMO Capital Markets Research., August 2010. Gold Prices 2010: $1,188, 2011: $1,300, 2012: $1,250, 2013: $1,150, Silver Prices: 2010: $18.50, 2011: $21.00, 2012: $20.00, 2013: $17.00 10
  11. 11. Improved Silver Agreement Quarterly Volatility, Tax Impact Remain Tax Impact Quarterly Variation In Revenues1 Primero pays tax on silver at spot price:  Gold price inc. 10%, op. cash flow inc. ~8%;  Silver price inc. 10%, op. cash flow dec. ~3-4%;  Gold and Silver price inc. 10%, op. cash flow inc.~6%; Quarterly Volatility Agreement structure causes quarterly earnings volatility Silver threshold based on anniversary of Silver:Gold Ratio August 6, not calendar year High correlation between gold & silver 96% over 10 years, 60% over 30 years Opportunity to Further Improve Increase San Dimas production 30 year historical silver:gold ratio 55:1 Consensus: 60:1 in 2011E, 55:1 in 2014E Investigate all appropriate tax planning alternatives Conclusion: Remote prospect of silver:gold ratio dramatically impacting Acquisition of additional operations fundamental valuation1. UBS Research, “Implications of Silver Stream”, December 2010. Assumes flat gold ($1,400/oz) and silver ($30/oz) 11
  12. 12. San Dimas TSX:P
  13. 13. San DimasSolid Platform with expansion & exploration potential TSX:P QUICK FACTS VentanasSAN DIMAS Durango, Mexico Exploration Property DURANGO MEXICOOWNERSHIP 100%METALS Gold & Silver San DimasMINING Underground, cut and fill Gold-Silver Mine DURANGO MEXICO RESERVES & RESOURCES (as at December 31, 2010) Mazatlan DurangoProven & Probable ReservesTonnes (millions) Grade (g/t) Silver (g/t) Gold (Moz) Silver (Moz)5.9 4.7 332 0.9 62.9Inferred Resources (exclusive of reserves)Tonnes (millions) Grade (g/t) Silver (g/t) Gold (Moz) Silver (Moz)16.9 3.7 330 2.0 178.8 2010 PRODUCTION 2011E PRODUCTIONGOLD EQ 100,300 gold equivalent ounces 110,000-120,000 gold equivalent ouncesGOLD 85,400 ounces 90,000-100,000 ouncesSILVER 4.5 million ounces 4.5-5.0 million ouncesCASH COST $584 per gold equivalent ounce $550-$570 per gold equivalent ounce 13
  14. 14. Record Reserves & ResourcesAnd Promising Exploration TSX:P Grew Gold & Silver Reserves 3% Grew Gold Resources 23% & Silver Resources 16% 90% Resource to Reserve Conversion Rate High-grade mineralization confirmed at depth in Central Block New high-grade discoveries in Sinaloa Graben Sinaloa Graben Gold Ounces Silver Ounces (millions) (millions) 2.0 179 1.6 1.6 Inf. 154 155 Inf Central Block 0.8 0.8 0.9 63 60 61 P+P P+P 2008 2009 2010 2008 2009 2010 14
  15. 15. San Dimas Growth Profile Cash Flow Funded TSX:P 200 Estimated Gold Equivalent Production1 (thousand gold equivalent ounces) 180 Sinaloa Graben 160 140 120 Central Block 100 80 60 40 Sta. Lucia 20 Sta. Rita Tayoltita 0 2010 2011E 2012E 2013E1. Forecast production figures were calculated using the following metal prices: 2011: gold $1,400 per ounce; silver $24 per ounce; silver price received from Silver Wheaton $4.04 per ounce. 2012: gold $1,450 per ounce; silver $25 perounce; silver price received from Silver Wheaton $4.08 per ounce. 2013: gold $1,270 per ounce; silver $21 per ounce; silver price received from Silver Wheaton $4.12 per ounce. 15
  16. 16. Optimization & Expansion TSX:PINCREASE MINE DEVELOPMENTKey to production growthOPERATE MILL AT DESIGN CAPACITYCurrent:~1,800 tpd, Design: 2,100 tpdEXPAND MILL TO 2,500 TPD BY 2013Mill: 2,100 tpd, Leach: 2,500 tpdPOTENTIAL EXPANSION BEYOND 2,500 tpd2011 review 16
  17. 17. Sinaloa Graben Key to Growth TSX:P Sinaloa Graben million ounce resource potential  90% of resources added in 2010 from Sinaloa Graben (340,000 ounces) Higher Grade:  Average reserve grades of 4.8 g/t Au, 339 g/t Ag  Sinaloa Graben results show ~6.0 – 10.0 g/t Wider:  Current average mining width ~1.5m  Sinaloa Graben results show ~3.0 – 8.0m 2011 Target:  Approach Roberta, Robertita (main production veins in adjacent Central Block)  Significantly increase Sinaloa Graben reserves and resources 17
  18. 18. 2011 Main Development & Targets TSX:P 1,000 m Roberta 14-920 Marinas 15-185SG TunnelRoberta 2011vein Budget Project VeinEl Pilar 7-790 SG Aranza vein Fault Santa Lucia 1-017 Sinaloa Graben 7-488 18
  19. 19. San Dimas Higher Grade Sinaloa Graben DDH Ag g/t Au g/t mRO-16-02 132RO-20-05 514 3.27 4.23 1.43 1.27 SAN FRANCISO N Central Block CULEBRA Arana 7 CANDELARIA Hanging Wall Tayoltita DDH Ag g/t Au g/t m A-25-217(1) 778 7.9 0.80DDH Ag g/t Au g/t m HW-4G-01B 302 8.7 0.60MAR-9-17 514 8.86 2.45 6 BLENDITA DDH Ag g/t Au g/t m CORONADO PATRICIASOL-9-02 549 10.67 1.81 5 Santa Rita 3 4 mine 5 HERMANOS LEGEND DDH Ag g/t Au g/t m EL SOLPIL 7-01 508 16.0 2.90 Ag-Au High S. ANTONIO 2 Mill West MINE Grade Trend Block 1 TAYOLTITA Proposed Tunnel San Antonio TOWN mine Tunnel Budget 2011DDH Ag g/t Au g/t m Tunnel doneTGS-S-22 958 6.81 8.56 VeinTGS-S-15 403 8.08 7.52 Fault Dev Ag g/t Au g/t m TownRAMP7-129W 1,115 10.30 2.75RAMP8-129E 2,054 22.8 3.20 MillRAMP8-129E 1,449 14.0 4.20 VERDOSA 0 1 2 km Piaxtla River (Source: San Dimas Geological Office) 19
  20. 20. The Value Proposition
  21. 21. Superior Production & CFPS Growth TSX:P 2010 to 2013E Production Growth1 2010 to 2013E CFPS Growth 2 160% 450% 140% 400% 120% 350% 300% 100% 250% 80% 200% 60% 150% 40% 100% 20% 50% 0% 0% Jaguar Jaguar Gammon Alamos Alamos Gammon Primero Primero New Gold New Gold Minefinders Minefinders1. Estimates based on street estimates (Primero based on company estimates);2. BMO Capital Markets Research (Jaguar based on consensus), January 31, 2011. 21 Note: As of Jan 31, 2011
  22. 22. 2011 Objectives TSX:P12345678 22
  23. 23. APPENDICES
  24. 24. Transaction Overview TSX:P1. $510 million structured as: $216 million in cash $184 million in shares of Primero (~36% ownership) $50 million 5-year 6% note ($5 million annually plus final balloon payment at the end of year 5) $60 million 1-year 3% note convertible at C$6.00 per share 24
  25. 25. Strong Management & Board TSX:PWade Nesmith | Executive Chairman Robert A. Quartermain Founder of Mala Noche Former President, Silver Standard Director of Vista Gold Corp. and Canplats Resources Founding and current director of Silver Wheaton, Chairman of Geovic Mining and Grant Edey Selwyn Resources Director of Breakwater Resources and former director of Queenstake Resources, Santa Cruz Gold Former CFO, IAMGOLDJoseph F. Conway | President & C.E.O. Former CEO, President and Director of Timo Jauristo IAMGOLD from 2003 to 2010 EVP, Corporate Development, Goldcorp Rohan HazeltonEduardo Luna | President, Mexico VP, Finance, Goldcorp Former Chairman and CEO of Silver Wheaton, David Demers Executive VP of Goldcorp and Luismin S.A. de Founder, CEO and Director Westport Innovations C.V. (San Dimas) and President of Mexican Director of Cummins Westport and Juniper Engines Mining Chamber and the Silver Institute Michael Riley Chartered accountant with more than 26 years of accounting experience Audit committee chair B.C. Lottery Corporation and Seacliff Construction 25
  26. 26. District Wide Upside – Long Section TSX:P 2011 PrioritySW NE San Antonio Sinaloa Graben Central Block Tayoltita Block Arana West Block Castellana and3,000 m. Block Robertas Hanging Wall 3,000 m.2,000 m. 2,000 m.1,000 m. 1,000 m. Source: San Dimas Geology Office Mineralization – Ore Bodies Extension of the Favorable Horizon 0 1 2 Favorable Horizon Potential K I L O M E T E R S 26
  27. 27. Sinaloa GrabenHigher Grade and Wider Widths Sinaloa Graben Tunnel: Julieta - Sinaloa Norte vein (San Salvador system) Sinaloa Mine Sinaloa Graben San Salvador ( Central Block ) (San Antonio Area) 7-660 L NE SW Ag g/t Au g/t m 189 3.13 1.24 1,000 m 1,000 m 500 m 500 m San Luis Tunnel Elev San Luis Tunnel Santa Anita Tunnel 0m 0m DDH TGS-S-22 DDH TGS S-15 DDH TGS 7-17 Sinaloa Norte Intercept Sinaloa Norte intercept Julieta intercept Ag g/t Au g/t m Ag g/t Au g/t m Ag g/t Au g/t m 958 6.81 8.56m 403 8.08 7.52 481 3.73 2.22 0 500 1000 Explanation Drilling Plan 2010 Proven Ore Drifting Plan M E T E R S Probable Ore Drifting Plan 2010 Probable Ore by Drilling Drifting Done 27
  28. 28. PRIMERO MINING CORP.Richmond Adelaide Centre120 Adelaide Street West, Suite 1202Toronto, ON M5H 1T1T 416 814 3160 F 416 814 3170TF 877 619 3160Email: info@primeromining.comINVESTOR RELATIONSTamara BrownVice President, Investor RelationsT 416 814 3168tbrown@primeromining.com The ‘New’ Americas Gold Play

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