2. Cautionary Statement TSX:P
This presentation may contain “forward-looking” statements within the meaning of Canadian securities legislation and the United States Private Securities
Litigation Reform Act of 1995. Forward-looking statements relate to future events or the anticipated performance of the Company 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 or comparable terminology. By their very nature forward-looking statements involve
known and unknown risks, uncertainties and other factors which may cause the actual performance of the Company to be materially different from any
anticipated 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 in
national and local governments in Mexico and the speculative nature of mineral exploration and development, risks associated with obtaining necessary
exploitation and environmental licenses and permits, and the presence of laws that may impose restrictions on mining. A complete list of risk factors are
described in the Company’s preliminary prospectus and will be detailed from time to time in the Company’s interim and annual financial statements and
management’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 these
terms 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 mineral
deposits 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 for
a Preliminary Assessment as defined under 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 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 any
obligation to update these forward-looking statements or information to reflect changes in assumptions or circumstances 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 undue reliance on forward-looking statements.
Unless otherwise indicated, all dollar values herein are in US$.
2
4. Corporate Strategy
Disciplined Growth TSX:P
GROWTH TARGETED GROWTH OBJECTIVE
Gold Eq. ounces (000) LEADING MID-TIER
2011-2012: Optimization & Expansion 400 GOLD PRODUCER
2011-2012: Potential Latin American acquisitions
Leading mid-tier gold producer by 2013 LATIN AMERICAN
ACQUISITIONS
300
LOW CASH COST
Below industry average cash costs SAN DIMAS
OPTIMIZATION ACQUISITIONS
200
LOW RISK EXPLORATION
Maintain balance sheet strength OPTIMIZATION
Un-hedged gold 100
SAN DIMAS
Americas pro-mining jurisdictions only (GOLD EQUIVALENT OUNCES)
Commitment to leading CSR programs
0
2010 2011E 2012E 2013E
4
5. San Dimas
Solid Platform with expansion & exploration potential TSX:P
QUICK FACTS
Ventanas
SAN DIMAS Durango, Mexico Exploration Property
DURANGO MEXICO
OWNERSHIP 100%
METALS Gold & Silver San Dimas
MINING Underground, cut and fill Gold-Silver Mine
DURANGO MEXICO
RESERVES & RESOUCES (as at December 31, 2009)
Mazatlan Durango
Proven & Probable Reserves
Tonnes (millions) Grade (g/t) Silver (g/t) Gold (Moz) Silver (Moz)
5.6 4.8 339 0.9 60.9
Inferred Resources (exclusive of reserves)
Tonnes (millions) Grade (g/t) Silver (g/t) Gold (Moz) Silver (Moz)
15.2 3.3 317 1.6 154.6
2010 PRODUCTION 2011E PRODUCTION
GOLD EQ 100,500 gold equivalent ounces 110,000-120,000 gold equivalent ounces
GOLD 85,400 ounces 90,000-100,000 ounces
SILVER 4.5 million ounces 4.5-5.0 million ounces
CASH COST $581 per gold equivalent ounce $550-$570 per gold equivalent ounce
5
6. Operating Results
Ownership Transition Complete TSX:P
Q4 2010 Q4 2009 2010 2009 2011E
Gold equivalent production 24,700 35,500 100,500 133,900 110,000-120,000
(gold equivalent ounces)
Gold production 21,200 30,800 85,400 113,000 90,000-100,000
(ounces)
Silver production 1.21 1.27 4.53 5.09 4.5-5.0
(million ounces)
Gold grade 4.01 5.89 4.46 5.36 4.8
(grams per tonne)
Silver grade 236 251 244 249 250
(grams per tonne)
1
Cash cost – gold equivalent $643 $411 $581 $407 $550-$570
($ per gold equivalent ounce)
1
Cash cost – by-product $524 $307 $471 $301 $350-$370
($ per gold ounce)
1. Cash cost is a non-GAAP measure.
2. Cash costs (by-product) per gold ounce reported for San Dimas by Goldcorp Inc. for year and three months ending Dec 31, 2009 were $287 and $272 respectively and are not comparable to 6
Primero cash cost numbers due to certain inter-company transactions that are reversed for Goldcorp Inc.’s consolidated reporting.
7. Strong Financial Position
Solid Platform for Growth TSX:P
(US$ million) September 30, 2010
Cash $55 million
Promissory note (5yr, 6%, $5M annual payment plus balloon in year 5) $50 million
Convertible note (1yr rolling, 3%, convertible at $6) $60 million
Long term debt $110 million
Common shares outstanding 88 million
Common shares, fully diluted 117 million
Volume (M)
Share Performance Relative Change
10 30%
Volume Primero TSX Gold Index
9
20%
8
7
10%
6
5 0%
4
-10%
3
2
-20%
1
- -30%
August September October November December January
7
8. Improved Silver Agreement
Increased Revenue, Reduced Costs
Term Production
25 years
Old Agreement 100% of silver production at $4
(19 remaining)
Revised Agreement Life of Mine First 4 years: First 3.5 million ounces plus 50% of excess sold at $4 plus
Goldcorp supplements Silver Wheaton with additional 1.5 million ounces
50% of production above 3.5 million sold by Primero at spot
Year 5 and beyond: First 6.0 million ounces plus 50% of excess sold at $4
50% of production above 6.0 million ounces sold by Primero at spot
Increases Revenue1 Decreases Cash Costs1
1. BMO Capital Markets Research. 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 8
9. Improved Silver Agreement
Quarterly Volatility, Tax Impact Remain
VOLATILE QUARTERLY SILVER PRICE RECEIVED1
QUARTERLY VOLATILITY
Agreement structure causes quarterly
earnings volatility
Silver threshold based on anniversary of
August 6, not calendar year
TAX IMPACT SILVER:GOLD RATIO
Primero pays tax on silver at spot price: High correlation between gold & silver
10% increase in Gold price increases operating 96% over 10 years, 60% over 30 years
cash flow by ~8%;
30 year historical silver:gold ratio 55:1
10% increase in Silver price decreases operating Consensus: 60:1 in 2011E, 55:1 in 2014E
cash flow by ~3-4%;
Conclusion: Remote prospect of
10% increase in Gold and Silver price increases
operating cash flow by ~6%; silver:gold ratio dramatically impacting
fundamental valuation
1. BMO Capital Markets Research. 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 9
10. Improved Silver Agreement
Opportunities for Further Improvement
Increase San Dimas production
Investigate all appropriate tax planning alternatives
Acquisition of additional operations:
Reduce tax impact
Smooth quarterly earnings
10
12. Historical Production1
Impact of High Grade TSX:P
Gold Equivalent Production Gold Equivalent Production Gold Grade
(000 gold equivalent ounces) (g/t)
250 9.0
Sinaloa Graben Discovery
Subsequent Acquisition of San Dimas by Primero
8.0
200
7.0
Central Block Discovery 6.0
Acquisition of San Dimas by Wheaton River
150
5.0
4.0
100
3.0
2.0
50
1.0
0 0.0
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
1. Gold equivalent ounces calculated on silver price received ie spot price from 1998-2004 and silver stream agreement price of ~$4/oz from 2005-2010 12
13. History of Reserve Growth1
TSX:P
Proven & Probable Reserves
1,400
(thousands of ounces)
Gold Equivalent Gold Silver Wheaton Silver Purchase Agreement
1,200
1,000
800
600
400
200
0
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
1. Gold equivalent ounces calculated on silver price received ie spot price from 1998-2004 and silver stream agreement price of ~$4/oz from 2005-2010 13
14. Established Infrastructure TSX:P
RECENT INVESTMENTS:
MILL EXPANDED
2002: 1,400 tpd to 2,100 tpd
NEW DRY TAILINGS SYSTEM
2,700 tpd going to 3,000 tpd
HYDRO PLANT
7MW reduced cost from $0.11 per kWh to $0.015
Potentially expanding to 14MW
14
15. Optimization & Expansion
TSX:P
INCREASE MINE DEVELOPMENT
Key to production growth
OPERATE MILL AT DESIGN CAPACITY
Current:1,600-1,800 tpd, Design: 2,100 tpd
EXPAND MILL TO 2,500 TPD BY 2013
Mill: 2,100 tpd, Leach: 2,500 tpd
POTENTIAL EXPANSION BEYOND 2,500 tpd
2011 review
15
17. Significant Exploration Upside TSX:P
Over 100 known veins in district
225 km2 land package
New high-grade zone called Sinaloa Graben discovered in 2009
Aggressive 2011 exploration budget:
$12 million
54,000 metres diamond drilling – 30% more than 2010 levels
3,800 metres exploration drifting – 11 times 2010 levels
17
18. Sinaloa Graben Key to Growth TSX:P
Sinaloa Graben million ounce resource potential
Only 27,000 ounces included in Reserves at Dec. 31, 2009
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:
Drift through Roberta, Robertita (main production veins in adjacent Central Block)
Significantly increase Sinaloa Graben reserves and resources
18
19. San Dimas
Higher Grade Sinaloa Graben
DDH Ag g/t Au g/t m
RO-16-02 132
RO-20-05 514
3.27
4.23
1.43
1.27
SAN FRANCISO N
CULEBRA
Arana
CANDELARIA
7
Hanging Wall
Tayoltita
Mine
DDH Ag g/t Au g/t m
A-25-217(1) 778 7.9 0.80
DDH Ag g/t Au g/t m HW-4G-01B 302 8.7 0.60
MAR-9-17 514 8.86 2.45 6 BLENDITA
DDH Ag g/t Au g/t m
CORONADO PATRICIA
SOL-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 SOL
PIL 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 2011
Tunnel done
Vein
DDH Ag g/t Au g/t m Fault
TGS-S-22 958 6.81 8.56
Town
TGS-S-15 403 8.08 7.52
Mill
Dev Ag g/t Au g/t m
VERDOSA 0 1 2 km
RAMP7-129W 1,115 10.30 2.75
Piaxtla River
(Source: San Dimas Geological Office) 19
24. Transaction Overview
TSX:P
1. $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. Strong Management & Board TSX:P
Wade 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, IAMGOLD
Joseph F. Conway | President & C.E.O.
Former CEO, President and Director of Timo Jauristo
IAMGOLD from 2003 to 2010 EVP, Corporate Development, Goldcorp
Rohan Hazelton
Eduardo 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. District Wide Upside – Long Section TSX:P
2011
Priority
SW NE
San Antonio Sinaloa Graben Central Block Tayoltita Block Arana
West Block Castellana and
3,000 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. Sinaloa Graben
Higher 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. PRIMERO MINING CORP.
Richmond Adelaide Centre
120 Adelaide Street West, Suite 1202
Toronto, ON M5H 1T1
T 416 814 3160 F 416 814 3170
TF 877 619 3160
Email: info@primeromining.com
INVESTOR RELATIONS
Tamara Brown
Vice President, Investor Relations
T 416 814 3168
tbrown@primeromining.com
The ‘New’ Americas Gold Play
