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<SEC-DOCUMENT>0001137171-06-001690.txt : 20060809
<SEC-HEADER>0001137171-06-001690.hdr.sgml : 20060809
<ACCEPTANCE-DATETIME>20060809112158
ACCESSION NUMBER:		0001137171-06-001690
CONFORMED SUBMISSION TYPE:	6-K
PUBLIC DOCUMENT COUNT:		3
CONFORMED PERIOD OF REPORT:	20060802
FILED AS OF DATE:		20060809
DATE AS OF CHANGE:		20060809

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			PAN AMERICAN SILVER CORP
		CENTRAL INDEX KEY:			0000771992
		STANDARD INDUSTRIAL CLASSIFICATION:	GOLD & SILVER ORES [1040]
		IRS NUMBER:				000000000
		FISCAL YEAR END:			0331

	FILING VALUES:
		FORM TYPE:		6-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-13727
		FILM NUMBER:		061015763

	BUSINESS ADDRESS:	
		STREET 1:		1500-625 HOWE STREET
		CITY:			VANCOUVER BC CANADA
		STATE:			A1
		ZIP:			V6C 2T6

	MAIL ADDRESS:	
		STREET 1:		1500 625 HOWE ST
		CITY:			VANCOUVER BC V6C 2T6
		STATE:			A1
		ZIP:			999999999

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	PAN AMERICAN MINERALS CORP
		DATE OF NAME CHANGE:	19950608
</SEC-HEADER>
<DOCUMENT>
<TYPE>6-K
<SEQUENCE>1
<FILENAME>panamerican6k080406.htm
<DESCRIPTION>PAN AMERICAN SILVER CORP. FORM 6-K
<TEXT>
<!doctype html public "-//IETF//DTD HTML//EN">
<HTML>
<HEAD>
<TITLE>CC Filed by Filing Services Canada Inc. 403-717-3898</TITLE>
<META NAME="author" CONTENT="lscott">
<META NAME="date" CONTENT="04/18/2006">
</HEAD>
<BODY style="line-height:12pt; font-family:Times New Roman; font-size:10pt; color:#000000">
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">
  <font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman, serif"><strong>FORM
  6-K</strong></font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
  &nbsp;
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">
  <font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman, serif"><strong>SECURITIES
  AND EXCHANGE COMMISSION</strong></font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
  &nbsp;
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">
  <font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman, serif"><strong>Washington,
  D.C. 20549</strong></font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
  &nbsp;
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">
  <font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman, serif"><strong>Report
  of Foreign Private Issuer</strong></font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
  &nbsp;
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">
  <font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman, serif"><strong>Pursuant
  to Rule 13a-16 or 15d-16</strong></font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
  &nbsp;
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">
  <font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman, serif"><strong>of
  the Securities Exchange Act of 1934</strong></font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
  &nbsp;
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">
  <font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman, serif">For
  the month of August, 2006</font>
  <p><font style="display: inline; font-size: 10pt; color: #000000; font-family: 'Times New Roman', serif">Commission
  File Number: 000-13727</font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
  &nbsp;
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">
  <font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman, serif"><u>Pan
  American Silver Corp.</u></font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">
  <font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman, serif">(Translation
  of registrant's name into English)</font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">
  <br>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">
  <font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman, serif"><u>1500-625
  HOWE STREET</u></font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">
  <font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman, serif"><u>VANCOUVER
  BC CANADA V6C 2T6</u></font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">
  <font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman, serif">(Address
  of principal executive offices)</font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
  &nbsp;
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">
  <font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman, serif">Indicate
  by check mark whether the registrant files or will file annual reports under
  cover Form 20-F or Form 40-F.</font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
  &nbsp;
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">
  <font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman, serif">Form
  20-F___ &nbsp;&nbsp;Form 40-F &nbsp;&nbsp;&nbsp;<u>&nbsp;&nbsp;X&nbsp;&nbsp;</u></font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
  &nbsp;
  <p><font style="display: inline; font-size: 10pt; color: #000000; font-family: 'Times New Roman', serif">Indicate
  by check mark if the registrant is submitting the Form 6-K in paper as
  permitted by Regulation S-T Rule 101(b)(1):&nbsp;<u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u></font>
  <p><font style="display: inline; font-size: 10pt; color: #000000; font-family: 'Times New Roman', serif">Indicate
  by check mark if the registrant is submitting the Form 6-K in paper as
  permitted by Regulation S-T Rule 101(b)(7):&nbsp;<u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u></font>
  <p>&nbsp;
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">
  <font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman, serif">Indicate
  by check mark whether the registrant by furnishing the information contained
  in this Form is also thereby furnishing the information to the Commission
  pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.</font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
  &nbsp;
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">
  <font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman, serif">Yes
  ..... &nbsp;No ..X...</font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
  &nbsp;
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">
  <font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman, serif">If
  &quot;Yes&quot; is marked, indicate below the file number assigned to the
  registrant in connection with Rule 12g3-2(b): &nbsp;82-________</font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">
  <b>Exhibit List</b>
  <p align="left">99.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <a href="newsrelease.htm">News
  Release dated August 2, 2006</a></p>
  <p>&nbsp;</p>
  <p>
  <font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman, serif"><strong>Signatures</strong></font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
  &nbsp;
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">
  <font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman, serif">Pursuant
  to the requirements of the Securities Exchange Act of 1934, the registrant has
  duly caused this report to be signed on its behalf by the undersigned,
  thereunto duly authorized.</font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
  &nbsp;
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">
  <font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman, serif"><u>Pan
  American Silver Corp.</u></font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">
  <font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman, serif">(Registrant)</font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
  <font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman, serif">Date:
  </font><font style="display: inline; font-size: 10pt; color: #000000; font-family: 'Times New Roman', serif">August
  3, 2006</font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">
  <font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman, serif">By:<u>/s/
  Ross Beaty&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u></font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">
  <font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman, serif">(Signature)</font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
  &nbsp;
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right">
  <font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman, serif">Ross
  Beaty, </font><font style="display: inline; font-size: 10pt; color: #000000; font-family: 'Times New Roman', serif">Chairman</font>
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
  &nbsp;
</div>
<div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">
  &nbsp;
</div>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
</BODY>
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>2
<FILENAME>newsrelease.htm
<DESCRIPTION>NEWS RELEASE
<TEXT>
<!doctype html public "-//IETF//DTD HTML//EN">
<HTML>
<HEAD>
<TITLE>CC Filed by Filing Services Canada Inc. 403-717-3898</TITLE>
<META NAME="author" CONTENT="Pan American Silver">
<META NAME="date" CONTENT="08/03/2006">
</HEAD>
<BODY style="line-height:12pt; font-family:Times New Roman; font-size:10pt; color:#000000">
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt; padding-right:-9pt" align=right><img src="newsrelease001.jpg" alt="[newsrelease001.jpg]" align=middle height=81 width=324.067></P>
<P style="line-height:12.5pt; margin:0pt; font-family:Arial; font-size:10.5pt"><FONT FACE="Arial">August 2, 2006</FONT></P>
<P style="margin:0pt"><BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align=center><B>PAN AMERICAN SILVER CORP. REPORTS SECOND QUARTER RESULTS:</B></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align=center><B>201% PROFIT INCREASE</B></P>
<P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>(all amounts in US Dollars unless otherwise stated)</P>
<P style="margin:0pt"><BR></P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=446.4></TD></TR>
<TR><TD style="border:0.5pt solid #000000" valign=top width=595.2><P style="line-height:13pt; margin:0pt; font-family:Arial; font-size:11pt"><B>SECOND QUARTER HIGHLIGHTS</B></P>
</TD></TR>
<TR><TD style="border-left:0.5pt solid #000000; border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=595.2><P style="line-height:12.5pt; margin-top:0pt; margin-bottom:-12.5pt; padding-left:36pt; text-indent:-18pt; font-family:Symbol; font-size:10.5pt" align=justify><FONT FACE="Symbol">&#183;</FONT></P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:2.65pt; padding-left:36pt; text-indent:-9pt; font-family:Arial; font-size:10.5pt" align=justify><FONT FACE="Arial">Record net income of $15 million ($0.21/share), up 201% from $5.0 million in Q2 2005.</FONT></P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:-12.5pt; padding-left:36pt; text-indent:-18pt; font-family:Symbol; font-size:10.5pt" align=justify><FONT FACE="Symbol">&#183;</FONT></P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:2.65pt; padding-left:36pt; text-indent:-9pt; font-family:Arial; font-size:10.5pt" align=justify><FONT FACE="Arial">Record mine operating earnings of $31.1 million, up almost six times from $4.5 million realized in Q2 2005.</FONT></P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:-12.5pt; padding-left:36pt; text-indent:-18pt; font-family:Symbol; font-size:10.5pt" align=justify><FONT FACE="Symbol">&#183;</FONT></P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:2.65pt; padding-left:36pt; text-indent:-9pt; font-family:Arial; font-size:10.5pt" align=justify><FONT FACE="Arial">Record low cash cost of $1.17 per ounce, a decrease of 74% from $4.48/oz in Q2 2005.</FONT></P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:-12.5pt; padding-left:36pt; text-indent:-18pt; font-family:Symbol; font-size:10.5pt" align=justify><FONT FACE="Symbol">&#183;</FONT></P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:2.65pt; padding-left:36pt; text-indent:-9pt; font-family:Arial; font-size:10.5pt" align=justify><FONT FACE="Arial">Silver production of 3.3 million ounces, up 7% over Q2 2005.</FONT></P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:-12.5pt; padding-left:36pt; text-indent:-18pt; font-family:Symbol; font-size:10.5pt" align=justify><FONT FACE="Symbol">&#183;</FONT></P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:2.65pt; padding-left:36pt; text-indent:-9pt; font-family:Arial; font-size:10.5pt" align=justify><FONT FACE="Arial">Record sales of $62.8 million, up 148% from $25.4 million in second quarter 2005.</FONT></P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:-12.5pt; padding-left:36pt; text-indent:-18pt; font-family:Symbol; font-size:10.5pt" align=justify><FONT FACE="Symbol">&#183;</FONT></P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:2.65pt; padding-left:36pt; text-indent:-9pt; font-family:Arial; font-size:10.5pt" align=justify><FONT FACE="Arial">Record operating cash flow of $29.2 million, an increase of $27.8 million over Q2 2005. </FONT></P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:-12.5pt; padding-left:36pt; text-indent:-18pt; font-family:Symbol; font-size:10.5pt" align=justify><FONT FACE="Symbol">&#183;</FONT></P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:2.65pt; padding-left:36pt; text-indent:-9pt; font-family:Arial; font-size:10.5pt" align=justify><FONT FACE="Arial">Working capital increases to $188.9 million &#150; the Company remains debt free.</FONT></P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:-12.5pt; padding-left:36pt; text-indent:-18pt; font-family:Symbol; font-size:10.5pt" align=justify><FONT FACE="Symbol">&#183;</FONT></P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:2.65pt; padding-left:36pt; text-indent:-9pt; font-family:Arial; font-size:10.5pt" align=justify><FONT FACE="Arial">Alamo Dorado mine remains on budget and on schedule for Q4 2006 start-up. </FONT></P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:-12.5pt; padding-left:36pt; text-indent:-18pt; font-family:Symbol; font-size:10.5pt" align=justify><FONT FACE="Symbol">&#183;</FONT></P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:2.65pt; padding-left:36pt; text-indent:-9pt; font-family:Arial; font-size:10.5pt" align=justify><FONT FACE="Arial">Construction of 4.3 million ounce per year silver mine at Manantial Espejo commenced. </FONT></P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:0pt"><BR></P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:5.5pt; font-family:Arial; font-size:11pt"><B><U>FINANCIAL RESULTS </U></B></P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:5.25pt; font-family:Arial; font-size:10.5pt" align=justify>Pan American Silver Corp. (NASDAQ: PAAS; TSX: PAA) today reported record quarterly net income of $15 million, or $0.21 per share, for the second quarter of 2006. This 201% increase over second quarter 2005 net income is primarily the result of increased silver production, significantly higher silver prices and record low production costs net of higher by-product credits. Mine operating earnings increased almost six-fold to $31.1 million versus $4.5 million in the year-earlier period.</P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:5.25pt; font-family:Arial; font-size:10.5pt" align=justify>Sales for the second quarter were $62.8 million, a 148% increase over Q2 2005, due to higher realized metal prices, increased production from the La Colorada and Morococha mines and increased concentrate shipments from Peru. Operating cash flow in the quarter increased to $29.2 million from $1.4 million in the year-earlier period. Working capital at June 30, 2006 was $188.9 million, an increase of $125.8 million from March 31, 2006, primarily a result of a $142 million equity financing completed in April, as well as record cash flow from operations.</P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:5.25pt; font-family:Arial; font-size:10.5pt" align=justify>The Company&#146;s record earnings for the second quarter included a $4.8 million loss from forward sale contracts. Specifically, the Company realized only $1,603 per tonne on approximately 53% of its payable zinc production, which had been previously sold forward. &nbsp;This was significantly below the average zinc price of $3,059 per tonne for the period. &nbsp;At the end of the second quarter, the Company closed out all of its remaining forward sales positions, leaving the Company with no exposure to metal hedges.</P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:5.25pt; font-family:Arial; font-size:10.5pt" align=justify>Consolidated silver production for the second quarter totaled 3.3 million ounces, a 7% increase over Q2 2005. Five of the Company&#146;s six operations increased their silver production and recorded higher mill throughput. The most significant increases in silver production were seen at La Colorada and Morococha, where production increased 23% and 12%, respectively. Base metal production in the quarter also increased compared to the year earlier period, with higher mill tonnage offsetting the impact of slightly lower ore grades. </P>
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<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:5.25pt; font-family:Arial; font-size:10.5pt" align=justify>Consolidated cash costs for the quarter were a record low of $1.17 per ounce compared to $4.48 per ounce for the year-earlier period, primarily due to increased by-product credits from greater base metal production coupled with higher base metal prices. Most notably, the Morococha and Quiruvilca mines generated negative cash costs per ounce of $3.81 and $1.07, respectively. </P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:5.25pt; font-family:Arial; font-size:10.5pt" align=justify>Geoff Burns, President and CEO of Pan American Silver commented: &#147;The first and second quarters of 2006 combined to deliver Pan American&#146;s highest production, earnings and cash flow performances ever. By focusing on improving operating efficiency and increasing production, we have positioned the Company to take advantage of the current strong market conditions. Having now eliminated our zinc hedge position, we will be able to clearly demonstrate our ability to generate significant earnings going forward. We are on track to produce 14 million ounces of silver in 2006 at a cash cost significantly lower than previously forecasted, and our two mines under construction should deliver sharply increased silver production and even better financial returns in the near future.&#148; </P>
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<P style="line-height:13pt; margin-top:0pt; margin-bottom:5.5pt; font-family:Arial; font-size:11pt"><B><U>OPERATIONS AND PRODUCTION HIGHLIGHTS</U></B></P>
<P style="line-height:13pt; margin-top:11pt; margin-bottom:5.5pt; font-family:Arial; font-size:11pt"><B>PERU</B></P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:5.25pt; font-family:Arial; font-size:10.5pt" align=justify>The <B>Morococha</B> mine had another very strong quarter, continuing its record-breaking production performance with 771,718 ounces of silver produced, and maintaining its status as the Company&#146;s lowest cost mine with a silver cash cost per ounce of negative $3.81. </P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:5.25pt; font-family:Arial; font-size:10.5pt" align=justify>Silver production at the <B>Quiruvilca</B> mine of 582,570 ounces was up modestly from the year-earlier period, but cash costs per ounce declined significantly to negative $1.07, down from $4.46/oz in Q2 2005. </P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:5.25pt; font-family:Arial; font-size:10.5pt" align=justify>The <B>Huaron</B> mine had an excellent quarter, producing 897,544 ounces of silver. Cash costs per ounce of $1.71 were the lowest that have been recorded since the Company re-opened the mine in 2001. As predicted, base metal recoveries have improved this year and, with mill throughput at record levels, silver production is expected to stay on course. In addition, we recently commenced a mine deepening program which will provide access to higher grade ore for years to come.</P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:5.25pt; font-family:Arial; font-size:10.5pt" align=justify>The <B>Silver Stockpile</B> operation produced 151,139 ounces of silver in the second quarter, which is slightly more than the year-earlier period and higher than management&#146;s forecast for the quarter as more tonnes were shipped than planned. Costs rose as a reflection of higher silver prices which, in turn, increase the royalty being paid under the operation&#146;s purchase agreement. </P>
<P style="line-height:13pt; margin-top:11pt; margin-bottom:5.5pt; font-family:Arial; font-size:11pt"><B>MEXICO</B></P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:5.25pt; font-family:Arial; font-size:10.5pt" align=justify>The <B>Alamo Dorado</B> mine is near mechanical completion and remains on schedule for start up in the fourth quarter, with 82% of the construction work completed. Project expenditures continue to track budget with approximately $18.2 million spent in the quarter, bringing total expenditures to date to $62.8 million. Ore mined and stockpiled at the end of the second quarter totaled 168,190 tonnes and, once the processing facility is fully operational, Alamo Dorado is expected to contribute approximately 500,000 ounces to Pan American&#146;s consolidated production for 2006. Over the life of the operation, Alamo Dorado is expected to produce an average of 5 million ounces of silver annually.</P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:5.25pt; font-family:Arial; font-size:10.5pt" align=justify>Silver production increased to 914,398 ounces at the <B>La Colorada</B> mine in the second quarter, or 23% more than the year-earlier period, at a stable cash cost per ounce of $5.56. The increased production is primarily a result of increased milling rates, combined with higher recovery and ore grade. With the recommencement of mining and milling of sulphide ore in June and, as the sulphide plant reaches full capacity over the coming months, the </P>
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<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:5.25pt; font-family:Arial; font-size:10.5pt" align=justify>mine is expected to further increase production and reduce costs over the remainder of the year. </P>
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<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:5.25pt; font-family:Arial; font-size:10.5pt" align=justify>Construction of the Manantial Espejo project officially commenced in the second quarter. Basic engineering and construction is well underway, including access road construction, site clearing, installation of temporary power, erection of a temporary shop warehouse facility, and completion of a dewatering well and a tailings line access. Capital costs for the project are expected to total $112.3 million, over a construction period of 18-20 months (excluding recoverable VAT tax of $18.1 million). The project is scheduled to be completed in late 2007 and produce an average of 4.3 million ounces of silver and 62,000 ounces of gold annually.</P>
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<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:5.25pt; font-family:Arial; font-size:10.5pt" align=justify>In Bolivia, treatment of ore at the <B>San Vicente</B> mine was delayed pending negotiation with state mining authority Comibol to extend an agreement for processing ore at an existing mill located off the property. An agreement has now been reached and milling of ore that was mined and stockpiled throughout the second quarter will recommence in early August. Feasibility analysis and engineering is continuing on a plan to expand mine production and build a new mill on the property. &nbsp;</P>
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<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:5.25pt; font-family:Arial; font-size:10.5pt" align=justify>Pan American&#146;s portfolio of assets has continued to create great growth opportunities,&#148; said Geoff Burns, President and CEO. &#147;With Alamo Dorado nearing completion, construction of Manantial Espejo started and engineering in full swing for expansions at Morococha and San Vicente, all the pieces are in place to enable Pan American&#146;s silver production to exceed 25 million ounces of silver annually by 2008.&#148;</P>
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<P style="line-height:13pt; margin-top:0pt; margin-bottom:5.5pt; font-family:Arial; font-size:11pt"><B><U>EXPLORATION </U></B></P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:5.25pt; font-family:Arial; font-size:10.5pt" align=justify>Throughout the first two quarters of 2006, Pan American&#146;s exploration team successfully advanced drilling and exploration projects in and around the Company&#146;s existing operations and development sites, especially at Morococha and La Colorada.</P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:5.25pt; font-family:Arial; font-size:10.5pt" align=justify>At Morococha, 11 diamond drills are currently active and a regional drilling program is systematically exploring the mine&#146;s 11,000 hectare land position. The focus of this exploration program is to expand the resource base and further delineate new mantos and vein structures that were discovered last year. Near Morococha, the Company has commenced diamond drilling of silver-zinc structures located on the Huaypachina property, where the Company has entered into an earn-in agreement to obtain a 100% interest in the property.</P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:5.25pt; font-family:Arial; font-size:10.5pt" align=justify>At La Colorada, exploration in the second quarter continued to focus on delineation of the new Amolillo vein and Recompensa structure to expand reserves and resources in the area. At Amolillo, high grade oxide silver mineralization appears to be continuous over economic mining widths. With further drilling to be conducted over the remainder of the year, the Company expects new silver reserves to be added to La Colorada&#146;s mineral reserve inventory, though the impact of the drilling results will not be fully evaluated until the program is complete. </P>
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<P style="line-height:13pt; margin-top:0pt; margin-bottom:5.5pt; font-family:Arial; font-size:11pt"><B><U>SILVER MARKETS</U></B></P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:5.25pt; font-family:Arial; font-size:10.5pt" align=justify>The price of silver fluctuated greatly in the second quarter, starting the quarter at $11.59 per ounce, peaking at almost $15.00 (London fix) on May 12, declining back to below $10.00 in mid-June, and ending the quarter at $10.70. In May, the annual World Silver Survey was published by GFMS on behalf of The Silver Institute. A summary is available on Pan American&#146;s website at <FONT COLOR=#0000FF><U>www.panamericansilver.com</U></FONT>. The GFMS report highlighted the </P>
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<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:5.25pt; font-family:Arial; font-size:10.5pt" align=justify>structural shift in silver investment over the last decade, with strong net investment in 2005 and sharply reduced silver stocks resulting in much higher silver prices. Silver mine supply, silver scrap supply and silver sales from government sources all rose 3%. On the demand side, industrial silver demand rose by 11% in 2005, jewelry demand rose 1%, photographic demand fell 9% and investment demand rose 13%. The successful launch of a silver ETF in April is providing significant new investment demand for silver and supporting silver&#146;s strong demand and supply fundamentals.</P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:5.25pt; font-family:Arial; font-size:10.5pt" align=justify>Physical interest in the Pan American Silver line of bullion products continues to remain high, as indicated by the sale of the 800,000<SUP>th</SUP> ounce of silver by the Northwest Territorial Mint in the second quarter and by the strong demand for the Company&#146;s new 100-ounce silver bar. All Pan American Silver products are available directly through the mint&#146;s website (<FONT COLOR=#0000FF><U>www.silverpa.com</U></FONT>). </P>
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<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:5.25pt; font-family:Arial; font-size:10.5pt" align=justify>Pan American will host a conference call to discuss its financial and operating results on Thursday, August 3, 2006 at 8:30 am (PST). North American participants please dial toll-free 1-888-694-4728 and international participants please dial 1-973-582-2745. The call may also be accessed from the home page of the Company&#146;s website at <FONT COLOR=#0000FF><U>www.panamericansilver.com</U></FONT>. The call will be available for replay for one week after the call by dialing 1-877-519-4471 (for North American callers) and 1-973-341-3080 (for international callers) and using the replay pin number 7595268.</P>
<P style="line-height:12.5pt; margin-top:0pt; margin-bottom:5.25pt; font-family:Arial; font-size:10.5pt" align=justify>For more information, please contact: Alexis Stewart, Director Corporate &amp; Investor Relations (604) 684.1175 &nbsp;<FONT COLOR=#0000FF><U>astewart@panamericansilver.com</U></FONT> </P>
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<P style="line-height:12.5pt; margin:0pt; font-family:Arial; font-size:10.5pt" align=center>- End - </P>
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<P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt"><B>CAUTION REGARDING FORWARD-LOOKING STATEMENTS</B></P>
<P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=justify><I>THIS NEWS RELEASE CONTAINS &#147;FORWARD-LOOKING INFORMATION&#148; WITHIN THE MEANING OF APPLICABLE CANADIAN SECURITIES LEGISLATION. STATEMENTS CONTAINING FORWARD-LOOKING INFORMATION EXPRESS, AS AT THE DATE OF THIS NEWS RELEASE, THE COMPANY&#146;S PLANS, ESTIMATES, FORECASTS, PROJECTIONS, EXPECTATIONS, OR BELIEFS AS TO FUTURE EVENTS OR RESULTS AND THE COMPANY DOES NOT INTEND, AND DOES NOT ASSUME ANY OBLIGATION TO, UPDATE SUCH STATEMENTS CONTAINING THE FORWARD-LOOKING INFORMATION. GENERALLY, FORWARD-LOOKING INFORMATION CAN BE IDENTIFIED BY THE USE OF FORWARD-LOOKING TERMINOLOGY SUCH AS &#147;PLANS&#148;, &#147;PROJECTS&#148; OR &#147;PROJECTED&#148;, &#147;EXPECTS&#148; OR &#147;DOES NOT EXPECT&#148;, &#147;IS EXPECTED&#148;, &#147;ESTIMATES&#148;, &#147;FORECASTS&#148;, &#147;SCHEDULED&#148;, &#147;INTENDS&#148;, &#147;ANTICIPATES&#148; OR &#147;DOES NOT ANTICIPATE&#148;, OR &#147;BELIEVES&#148;, OR VARIATIONS OF SUCH 
WORDS AND PHRASES, OR STATEMENTS THAT CERTAIN ACTIONS, EVENTS OR RESULTS &#147;MAY&#148;, &#147;CAN&#148;, &#147;COULD&#148;, &#147;WOULD&#148;, &#147;MIGHT&#148; OR &#147;WILL BE TAKEN&#148;, &#147;OCCUR&#148; OR &#147;BE ACHIEVED&#148;. STATEMENTS CONTAINING FORWARD-LOOKING INFORMATION INCLUDE, BUT ARE NOT LIMITED TO, STATEMENTS WITH RESPECT TO TIMING AND BUDGET OF CONSTRUCTION ACTIVITIES AT ALAMO DORADO AND MANANTIAL ESPEJO, THE EXPECTED RESULTS FROM EXPLORATION ACTIVITIES, THE ECONOMIC VIABILITY OF THE DEVELOPMENT OF NEWLY DISCOVERED ORE BODIES, THE ESTIMATION OF FUTURE PRODUCTION LEVELS, EXPECTATIONS REGARDING MINE PRODUCTION COSTS, THE RESULTS OF DRILLING, AND PAN AMERICAN SILVER&#146;S COMMITMENT TO, AND PLANS FOR DEVELOPING, NEWLY DISCOVERED AND EXISTING MINERALIZED STRUCTURES. </I></P>
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<P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=justify><I>STATEMENTS CONTAINING FORWARD-LOOKING INFORMATION INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS THAT MAY CAUSE THE ACTUAL RESULTS, LEVEL OF ACTIVITY, PERFORMANCE OR ACHIEVEMENTS OF PAN AMERICAN SILVER AND ITS OPERATIONS TO BE MATERIALLY DIFFERENT FROM THOSE EXPRESSED OR IMPLIED BY SUCH STATEMENTS. SUCH FACTORS INCLUDE, AMONG OTHERS, RISKS RELATED TO TECHNOLOGICAL AND OPERATIONAL NATURE OF THE COMPANY&#146;S BUSINESS, CHANGES IN THE POLITICAL OR ECONOMIC ENVIRONMENT, THE ACTUAL RESULTS OF CURRENT EXPLORATION ACTIVITIES, CONCLUSIONS OF ECONOMIC EVALUATIONS, CHANGES IN PROJECT PARAMETERS TO DEAL WITH UNANTICIPATED ECONOMIC FACTORS, FUTURE PRICES OF SILVER, GOLD AND OTHER BASE METALS, AS WELL AS THOSE FACTORS DESCRIBED IN THE SECTIONS RELATING TO RISK FACTORS OF PAN AMERICAN SILVER&#146;S BUSINESS FILED IN THE COMPANY&#146;S REQUIRED SECURITIES FILINGS ON SEDAR. ALTHOUGH THE COMPANY HAS ATTEMPTED TO IDEN
TIFY IMPORTANT FACTORS THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE CONTAINED IN FORWARD-LOOKING STATEMENTS, THERE MAY BE OTHER FACTORS THAT CAUSE RESULTS TO BE MATERIALLY DIFFERENT FROM THOSE ANTICIPATED, DESCRIBED, ESTIMATED, ASSESSED OR INTENDED. THERE CAN BE NO ASSURANCE THAT ANY STATEMENTS CONTAINING FORWARD-LOOKING INFORMATION WILL PROVE TO BE ACCURATE AS ACTUAL RESULTS AND FUTURE EVENTS COULD DIFFER MATERIALLY FROM THOSE ANTICIPATED IN SUCH STATEMENTS. ACCORDINGLY, READERS SHOULD NOT PLACE UNDUE RELIANCE ON STATEMENTS CONTAINING FORWARD-LOOKING INFORMATION.</I></P>
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<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial"><B>Financial &amp; Operating Highlights</B></P>
</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=72>&nbsp;</TD><TD valign=top width=252 colspan=6 rowspan=2>&nbsp;</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=72>&nbsp;</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=156 colspan=3><P style="margin:0pt; font-family:Arial" align=center><B>Three months ended</B></P>
</TD><TD width=168 colspan=4><P style="margin:0pt; font-family:Arial" align=center><B>Six months ended</B></P>
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<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=156 colspan=3><P style="margin:0pt; font-family:Arial" align=center><B>June 30</B></P>
</TD><TD width=168 colspan=4><P style="margin:0pt; font-family:Arial" align=center><B>June 30</B></P>
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<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=326>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="margin:0pt; font-family:Arial" align=center><B>2006</B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=84 colspan=2><P style="margin:0pt; font-family:Arial" align=center><B>2005</B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=84 colspan=2><P style="margin:0pt; font-family:Arial" align=center><B>2006</B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=84 colspan=2><P style="margin:0pt; font-family:Arial" align=center><B>2005</B></P>
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<TR><TD valign=bottom width=410 colspan=3><P style="margin:0pt; font-family:Arial"><B>Consolidated Financial Highlights (in thousands of US dollars)</B></P>
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<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial">(Unaudited)</P>
</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=72>&nbsp;</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=72>&nbsp;</TD><TD valign=bottom width=12>&nbsp;</TD><TD valign=bottom width=72><P style="margin:0pt"><BR></P>
</TD><TD valign=bottom width=12>&nbsp;</TD><TD valign=bottom width=72><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=bottom width=326>&nbsp;</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=72>&nbsp;</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=72>&nbsp;</TD><TD valign=bottom width=12>&nbsp;</TD><TD valign=bottom width=72><P style="margin:0pt"><BR></P>
</TD><TD valign=bottom width=12>&nbsp;</TD><TD valign=bottom width=72><P style="margin:0pt"><BR></P>
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<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial">Net income for the period</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">14,964</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">4,971</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">12,203</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">748</P>
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<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial">Basic income per share</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>0.21</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">0.07</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">0.17</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">0.01</P>
</TD></TR>
<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial">Diluted income per share </P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>0.20</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>0.07</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>0.16</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>0.01</P>
</TD></TR>
<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial">Cash flow from operations</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">29,227</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,378</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">36,744</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">4,236</P>
</TD></TR>
<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial">Exploration expenses </P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">637</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">882</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,871</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">2,309</P>
</TD></TR>
<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial">Cash and short-term investments</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">185,335</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">78,941</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">185,335</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">78,941</P>
</TD></TR>
<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial">Working capital</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">188,948</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">95,416</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">188,948</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">95,416</P>
</TD></TR>
<TR><TD valign=bottom width=326>&nbsp;</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD></TR>
<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial"><B>Consolidated Ore Milled &amp; Metals Recovered to Concentrate</B></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD></TR>
<TR><TD valign=bottom width=326>&nbsp;</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD></TR>
<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial">Tonnes milled</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">457,280</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">418,422</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">913,618</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">812,015</P>
</TD></TR>
<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial">Silver metal - ounces</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">3,317,369</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">3,088,667</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">6,644,896</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">6,084,369</P>
</TD></TR>
<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial">Zinc metal - tonnes</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">9,493</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">9,246</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">20,193</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">18,117</P>
</TD></TR>
<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial">Lead metal - tonnes</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">3,914</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">3,703</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">7,868</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">7,378</P>
</TD></TR>
<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial">Copper metal - tonnes</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,165</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,051</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">2,207</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,978</P>
</TD></TR>
<TR><TD valign=bottom width=326>&nbsp;</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=bottom width=326><P style="margin:0pt; text-indent:-229.9pt; font-family:Arial"><B>Consolidated Cost per Ounce of Silver (net of by-product credits)</B></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=bottom width=326>&nbsp;</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial">Total cash cost per ounce</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>1.17</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>4.48</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>1.81</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>4.50</P>
</TD></TR>
<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial">Total production cost per ounce</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>2.63</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>5.83</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>3.26</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>5.83</P>
</TD></TR>
<TR><TD valign=bottom width=326>&nbsp;</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD></TR>
<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial"><B>In thousands of US dollars</B></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD></TR>
<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial">Direct operating costs, royalties, treatment</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD></TR>
<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial">and refining charges</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>42,718</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>29,954</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>80,326</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>58,786</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=326><P style="margin:0pt; font-family:Arial">By-product credits</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>(39,156)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>(17,273)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>(69,332)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>(33,836)</P>
</TD></TR>
<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial">Cash operating costs</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">3,562</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">12,681</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">10,994</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">24,951</P>
</TD></TR>
<TR><TD style="border-bottom:1pt solid #000000" valign=bottom width=326><P style="margin:0pt; font-family:Arial">Depreciation, amortization and reclamation</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:1pt solid #000000" valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">4,442</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:1pt solid #000000" valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">3,823</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:1pt solid #000000" valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">8,844</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:1pt solid #000000" valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">7,393</P>
</TD></TR>
<TR><TD style="border-bottom:1.5pt solid #000000" valign=bottom width=326><P style="margin:0pt; font-family:Arial">Production costs</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>8,004</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>16,504</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>19,838</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>32,344</P>
</TD></TR>
<TR><TD valign=bottom width=326>&nbsp;</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial">Payable ounces of silver (used in cost per ounce calculations)</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">3,048,131</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">2,831,511</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">6,079,589</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">5,549,584</P>
</TD></TR>
<TR><TD valign=bottom width=326>&nbsp;</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial"><B>Average Metal Prices</B></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial">Silver - London Fixing per tonne</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>12.25</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>7.16</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>10.96</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>7.06</P>
</TD></TR>
<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial">Zinc - LME Cash Settlement per tonne</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>3,059</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>1,274</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>2,762</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>1,295</P>
</TD></TR>
<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial">Lead - LME Cash Settlement per tonne</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>1,121</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>987</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>1,169</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>983</P>
</TD></TR>
<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial">Copper - LME Cash Settlement per tonne</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>6,663</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>3,394</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>6,070</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>3,333</P>
</TD></TR>
</TABLE>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR>
<BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">5</P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="margin:0pt; page-break-before:always"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=244.5></TD><TD width=9></TD><TD width=54></TD><TD width=9></TD><TD width=54></TD><TD width=9></TD><TD width=58></TD><TD width=9></TD><TD width=54></TD></TR>
<TR><TD valign=bottom width=326><P style="margin:0pt; font-family:Arial"><B>Mine Operations Highlights</B></P>
</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=72>&nbsp;</TD><TD valign=top width=257.333 colspan=6 rowspan=2>&nbsp;</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=72>&nbsp;</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=156 colspan=3><P style="margin:0pt; font-family:Arial" align=center><B>Three months ended</B></P>
</TD><TD width=173.333 colspan=4><P style="margin:0pt; font-family:Arial" align=center><B>Six months ended</B></P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=156 colspan=3><P style="margin:0pt; font-family:Arial" align=center><B>June 30</B></P>
</TD><TD width=173.333 colspan=4><P style="margin:0pt; font-family:Arial" align=center><B>June 30</B></P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=326>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="margin:0pt; font-family:Arial" align=center><B>2006</B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=84 colspan=2><P style="margin:0pt; font-family:Arial" align=center><B>2005</B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=89.333 colspan=2><P style="margin:0pt; font-family:Arial" align=center><B>2006</B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=84 colspan=2><P style="margin:0pt; font-family:Arial" align=center><B>2005</B></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial"><B>Huaron Mine</B></P>
</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=72>&nbsp;</TD><TD valign=top width=257.333 colspan=6>&nbsp;</TD></TR>
<TR><TD valign=bottom width=326>&nbsp;</TD><TD valign=bottom width=12>&nbsp;</TD><TD valign=bottom width=72>&nbsp;</TD><TD valign=bottom width=12>&nbsp;</TD><TD valign=bottom width=72>&nbsp;</TD><TD valign=bottom width=12>&nbsp;</TD><TD valign=bottom width=77.333><P style="margin:0pt"><BR></P>
</TD><TD valign=bottom width=12>&nbsp;</TD><TD valign=bottom width=72><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Tonnes milled</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">165,427</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">159,219</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">327,945</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">305,229</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Average silver grade - grams per tonne</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">203</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">212</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">209</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">215</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Average zinc grade</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>2.50%</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>2.88%</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>2.64%</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>2.95%</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Silver &#150; ounces</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">897,544</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">922,643</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,832,024</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,806,790</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Zinc &#150; tonnes</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">2,831</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">3,065</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">5,723</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">6,244</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Lead &#150; tonnes</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,802</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,621</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">3,621</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">3,525</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Copper &#150; tonnes</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">443</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">496</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">846</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">877</P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Total cash cost per ounce</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>1.71</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>5.24</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>2.64</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>4.99</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Total production cost per ounce</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>2.98</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>6.45</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>3.88</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>6.19</P>
</TD></TR>
<TR><TD valign=bottom width=326>&nbsp;</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial"><B>In thousands of US dollars</B></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Direct operating costs, royalties, treatment and </P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">refining charges</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">14,227</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">10,754</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">26,659</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">21,000</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=326><P style="margin:0pt; font-family:Arial">By-product credits</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(12,828)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(6,366)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(22,262)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(12,806)</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Cash operating costs</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,399</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">4,388</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">4,396</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">8,194</P>
</TD></TR>
<TR><TD style="border-bottom:1pt solid #000000" valign=top width=326><P style="margin:0pt; font-family:Arial">Depreciation, amortization and reclamation</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:1pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,042</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:1pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,018</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:1pt solid #000000" valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">2,068</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:1pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,962</P>
</TD></TR>
<TR><TD style="border-bottom:1.5pt solid #000000" valign=top width=326><P style="margin:0pt; font-family:Arial">Production costs</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">2,441</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">5,406</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">6,464</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">10,156</P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=77.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Payable ounces of silver (used in cost per ounce calculation)</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">818,588</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">837,864</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,665,878</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,640,658</P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial"><B>Quiruvilca Mine</B></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Tonnes milled</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">94,112</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">90,328</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">189,632</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">180,253</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Average silver grade - grams per tonne</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">224</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">229</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">225</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">226</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Average zinc grade</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>2.88%</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>3.06%</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>2.93%</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>3.13%</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Silver - ounces</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">582,570</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">580,999</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,191,207</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,144,386</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Zinc - tonnes</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">2,320</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">2,323</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">4,759</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">4,774</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Lead - tonnes</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">652</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">668</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,318</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,349</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Copper - tonnes</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">342</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">321</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">696</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">643</P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Total cash cost per ounce</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>(1.07)</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>4.46</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>(0.05)</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>4.34</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Total production cost per ounce</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>0.10</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>5.00</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>1.10</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>4.88</P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial"><B>In thousands of US dollars</B></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Direct operating costs, royalties, treatment and</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">refining charges</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">8,990</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">6,670</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">16,654</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">13,338</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=326><P style="margin:0pt; font-family:Arial">By-product credits</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(9,570)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(4,252)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(16,713)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(8,717)</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Cash operating costs</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(580)</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">2,418</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(59)</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">4,621</P>
</TD></TR>
<TR><TD style="border-bottom:1pt solid #000000" valign=top width=326><P style="margin:0pt; font-family:Arial">Depreciation, amortization and reclamation</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:1pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">634</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:1pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">292</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:1pt solid #000000" valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,274</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:1pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">583</P>
</TD></TR>
<TR><TD style="border-bottom:1.5pt solid #000000" valign=top width=326><P style="margin:0pt; font-family:Arial">Production costs</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">54</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">2,710</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,215</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">5,204</P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=77.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Payable ounces of silver (used in cost per ounce calculation)</P>
</TD><TD valign=bottom width=12>&nbsp;</TD><TD valign=bottom width=72><P style="margin:0pt; text-indent:11pt; font-family:Arial">540,683</P>
</TD><TD valign=bottom width=12>&nbsp;</TD><TD valign=bottom width=72><P style="margin:0pt; text-indent:11pt; font-family:Arial">541,793</P>
</TD><TD valign=bottom width=12>&nbsp;</TD><TD valign=bottom width=77.333><P style="margin:0pt; text-indent:3.5pt; font-family:Arial">1,107,175</P>
</TD><TD valign=bottom width=12>&nbsp;</TD><TD valign=bottom width=72><P style="margin:0pt; text-indent:3.5pt; font-family:Arial">1,065,874</P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=72><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=72><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=77.333><P style="margin:0pt"><BR></P>
</TD><TD valign=bottom width=12>&nbsp;</TD><TD valign=top width=72><P style="margin:0pt"><BR></P>
</TD></TR>
</TABLE>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR>
<BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">6</P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="margin:0pt; page-break-before:always"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR>
<BR>
<BR></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=244.5></TD><TD width=9></TD><TD width=54></TD><TD width=9></TD><TD width=54></TD><TD width=9></TD><TD width=54></TD><TD width=9></TD><TD width=54></TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=156 colspan=3><P style="margin:0pt; font-family:Arial" align=center><B>Three months ended</B></P>
</TD><TD width=168 colspan=4><P style="margin:0pt; font-family:Arial" align=center><B>Six months ended</B></P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=156 colspan=3><P style="margin:0pt; font-family:Arial" align=center><B>June 30</B></P>
</TD><TD width=168 colspan=4><P style="margin:0pt; font-family:Arial" align=center><B>June 30</B></P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=326>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="margin:0pt; font-family:Arial" align=center><B>2006</B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=84 colspan=2><P style="margin:0pt; font-family:Arial" align=center><B>2005</B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=84 colspan=2><P style="margin:0pt; font-family:Arial" align=center><B>2006</B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=84 colspan=2><P style="margin:0pt; font-family:Arial" align=center><B>2005</B></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial"><B>Morococha Mine*</B></P>
</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=72>&nbsp;</TD><TD valign=top width=252 colspan=6>&nbsp;</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=72><P style="margin:0pt"><BR></P>
</TD><TD valign=bottom width=12>&nbsp;</TD><TD valign=top width=72><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=72><P style="margin:0pt"><BR></P>
</TD><TD valign=bottom width=12>&nbsp;</TD><TD valign=top width=72><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Tonnes milled</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">140,487</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">116,542</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">273,260</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">227,070</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Average silver grade - grams per tonne</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">199</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">218</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">200</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">220</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Average zinc grade</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>3.71%</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>4.27%</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>4.08%</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>4.17%</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Silver - ounces</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">771,718</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">691,612</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,507,144</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,345,147</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Zinc - tonnes</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">4,342</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">3,857</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">9,427</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">7,099</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Lead - tonnes</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,453</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,414</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">2,923</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">2,504</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Copper - tonnes</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">380</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">234</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">650</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">458</P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Total cash cost per ounce</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>(3.81)</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>2.78</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>(2.86)</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>3.25</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Total production cost per ounce</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>(2.20)</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>4.49</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>(1.25)</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>4.98</P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial"><B>In thousands of US dollars</B></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Direct operating costs, royalties, treatment and </P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">refining charges</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>13,586</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>8,074</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>24,997</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>15,626</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=326><P style="margin:0pt; font-family:Arial">By-product credits</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(16,229)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(6,334)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(28,851)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(11,679)</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Cash operating costs</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(2,643)</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,740</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(3,854)</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">3,947</P>
</TD></TR>
<TR><TD style="border-bottom:1pt solid #000000" valign=top width=326><P style="margin:0pt; font-family:Arial">Depreciation, amortization and reclamation</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:1pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,115</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:1pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,071</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:1pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">2,176</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:1pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">2,102</P>
</TD></TR>
<TR><TD style="border-bottom:1.5pt solid #000000" valign=top width=326><P style="margin:0pt; font-family:Arial">Production costs</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>(1,528)</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>2,811</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>(1,678)</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>6,049</P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Payable ounces of silver (used in cost per ounce calculations)</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">692,960</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">626,139</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,348,072</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,213,823</P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">* Production and cost figures are for Pan American&#146;s share &nbsp;only. &nbsp;Pan American&#146;s ownership was approximately 88.7% during the quarter.</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial"><B>La Colorada Mine</B></P>
</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=72><P style="margin:0pt"><BR></P>
</TD><TD valign=bottom width=12>&nbsp;</TD><TD valign=top width=72><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=72><P style="margin:0pt"><BR></P>
</TD><TD valign=bottom width=12>&nbsp;</TD><TD valign=top width=72><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=72><P style="margin:0pt"><BR></P>
</TD><TD valign=bottom width=12>&nbsp;</TD><TD valign=top width=72><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=72><P style="margin:0pt"><BR></P>
</TD><TD valign=bottom width=12>&nbsp;</TD><TD valign=top width=72><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Tonnes milled</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">57,254</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">52,333</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">113,794</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">99,463</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Average silver grade - grams per tonne</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">580</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">556</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">546</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">553</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Silver - ounces</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">914,398</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">743,397</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,711,644</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,432,016</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Zinc - tonnes</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Lead - tonnes</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">7</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">7</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Total cash cost per ounce</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>5.56</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>5.39</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>5.70</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>5.48</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Total production cost per ounce</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>7.37</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>7.34</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>7.64</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>7.40</P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial"><B>In thousands of US dollars</B></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Direct operating costs, royalties, treatment and </P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">refining charges</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">5,599</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">4,319</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">10,654</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">8,466</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=326><P style="margin:0pt; font-family:Arial">By-product credits</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(530)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(321)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(922)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(636)</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Cash operating costs</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">5,069</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">3,998</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">9,732</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">7,830</P>
</TD></TR>
<TR><TD style="border-bottom:1pt solid #000000" valign=top width=326><P style="margin:0pt; font-family:Arial">Depreciation, amortization and reclamation</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:1pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,651</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:1pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,443</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:1pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">3,306</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:1pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">2,747</P>
</TD></TR>
<TR><TD style="border-bottom:1.5pt solid #000000" valign=top width=326><P style="margin:0pt; font-family:Arial">Production costs</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">6,720</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">5,441</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">13,038</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:1.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">10,577</P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Payable ounces of silver (used in cost per ounce calculations)</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">911,623</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">741,538</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,706,091</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,428,436</P>
</TD></TR>
</TABLE>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR>
<BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">7</P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="margin:0pt; page-break-before:always"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=244.5></TD><TD width=9></TD><TD width=54></TD><TD width=9></TD><TD width=54></TD><TD width=9></TD><TD width=54></TD><TD width=9></TD><TD width=54></TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=156 colspan=3><P style="margin:0pt; font-family:Arial" align=center><B>Three months ended</B></P>
</TD><TD width=168 colspan=4><P style="margin:0pt; font-family:Arial" align=center><B>Six months ended</B></P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=156 colspan=3><P style="margin:0pt; font-family:Arial" align=center><B>June 30</B></P>
</TD><TD width=168 colspan=4><P style="margin:0pt; font-family:Arial" align=center><B>June 30</B></P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=326>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="margin:0pt; font-family:Arial" align=center><B>2006</B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=84 colspan=2><P style="margin:0pt; font-family:Arial" align=center><B>2005</B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=84 colspan=2><P style="margin:0pt; font-family:Arial" align=center><B>2006</B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=84 colspan=2><P style="margin:0pt; font-family:Arial" align=center><B>2005</B></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial"><B>Silver Stock Piles</B></P>
</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=72>&nbsp;</TD><TD valign=top width=252 colspan=6>&nbsp;</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=72><P style="margin:0pt"><BR></P>
</TD><TD valign=bottom width=12>&nbsp;</TD><TD valign=top width=72><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=72><P style="margin:0pt"><BR></P>
</TD><TD valign=bottom width=12>&nbsp;</TD><TD valign=top width=72><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Tonnes sold</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">14,322</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">13,675</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">29,256</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">31,412</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Average silver grade - grams per tonne</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">328</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">341</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">345</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">353</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Silver - ounces</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">151,139</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">150,016</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">324,327</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">356,030</P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Total cash cost per ounce</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>3.76</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>1.63</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>3.18</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>1.78</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Total production cost per ounce</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>&nbsp;3.76</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>&nbsp;1.63</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">3.18</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1.78</P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial"><B>In thousands of US dollars</B></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Direct operating costs, royalties, treatment and </P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">refining charges</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>317</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>137</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">579</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">358</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=326><P style="margin:0pt; font-family:Arial">By-product credits</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Cash operating costs</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">317</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">137</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">579</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">358</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=326><P style="margin:0pt; font-family:Arial">Depreciation, amortization and reclamation</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD></TR>
<TR><TD style="border-bottom:2pt double #000000" valign=top width=326><P style="margin:0pt; font-family:Arial">Production costs</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>317</P>
</TD><TD style="border-bottom:2pt double #000000" valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>137</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">579</P>
</TD><TD style="border-bottom:2pt double #000000" valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">358</P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><A NAME="OLE_LINK2"></A><A NAME="OLE_LINK3"></A></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Payable ounces of silver (used in cost per ounce calculations)</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">84,277</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">84,177</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">182,288</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">200,793</P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial"><B>San Vicente Mine**</B></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Tonnes milled</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">8,987</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Average silver grade - grams per tonne</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">321</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Average zinc grade &#150; percent</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>-</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>-</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>3.99%</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>-</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Silver - ounces</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">78,550</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Zinc - tonnes</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">284</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Copper - tonnes</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">15</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Total cash cost per ounce</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>-</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>-</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>2.85</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>-</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Total production cost per ounce</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>&nbsp;-</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>&nbsp;-</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">3.14</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>-</P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial"><B>In thousands of US dollars</B></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Direct operating costs, royalties, treatment and </P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">refining charges</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>-</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>-</P>
</TD><TD valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">783</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=326><P style="margin:0pt; font-family:Arial">By-product credits</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(584)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Cash operating costs</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">199</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=326><P style="margin:0pt; font-family:Arial">Depreciation, amortization and reclamation</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">20</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD></TR>
<TR><TD style="border-bottom:2pt double #000000" valign=top width=326><P style="margin:0pt; font-family:Arial">Production costs</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>-</P>
</TD><TD style="border-bottom:2pt double #000000" valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>-</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">219</P>
</TD><TD style="border-bottom:2pt double #000000" valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD></TR>
<TR><TD valign=top width=326><P style="margin:0pt; font-family:Arial">Payable ounces of silver (used in cost per ounce calculations)</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">70,086</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD></TR>
<TR><TD valign=top width=326>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
</TABLE>
<P style="margin:0pt"><BR><BR></P>
<P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">** The production statistics represent Pan American&#146;s 55% interest in the mine in 2006.</P>
<P style="margin:0pt"><BR>
<BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">8</P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="margin:0pt; page-break-before:always"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=299.55></TD><TD width=18.2></TD><TD width=76.3></TD><TD width=22></TD><TD width=66.75></TD></TR>
<TR><TD valign=top width=643.733 colspan=5><P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align=center><B>PAN AMERICAN SILVER CORP</B>.</P>
</TD></TR>
<TR><TD valign=top width=643.733 colspan=5><P style="margin:0pt; font-family:Arial" align=center>Consolidated Balance Sheets</P>
</TD></TR>
<TR><TD valign=top width=643.733 colspan=5><P style="margin:0pt; font-family:Arial" align=center>(In thousands of US dollars)</P>
</TD></TR>
<TR><TD valign=top width=643.733 colspan=5><P style="margin:0pt; font-family:Arial" align=center>(Unaudited)</P>
</TD></TR>
<TR><TD valign=top width=399.4>&nbsp;</TD><TD valign=top width=126 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center><B>June 30, 2006</B></P>
</TD><TD width=118.333 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center><B>December 31, 2005</B></P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=643.733 colspan=5>&nbsp;</TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; font-family:Arial"><B>Assets</B></P>
</TD><TD width=24.267>&nbsp;</TD><TD width=101.733>&nbsp;</TD><TD width=118.333 colspan=2>&nbsp;</TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; font-family:Arial">Current</P>
</TD><TD width=24.267>&nbsp;</TD><TD width=101.733>&nbsp;</TD><TD width=118.333 colspan=2>&nbsp;</TD></TR>
<TR><TD width=399.4><P style="margin:0pt; text-indent:9pt; font-family:Arial">Cash and cash equivalents</P>
</TD><TD width=24.267><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">62,919</P>
</TD><TD width=29.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">29,291</P>
</TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; text-indent:9pt; font-family:Arial">Short-term investments</P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">122,416</P>
</TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">26,031</P>
</TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; text-indent:9pt; font-family:Arial">Accounts receivable, net of $Nil provision for doubtful accounts</P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">34,615</P>
</TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">27,342</P>
</TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; text-indent:9pt; font-family:Arial">Inventories (note 4)</P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">20,517</P>
</TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">16,667</P>
</TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; text-indent:9pt; font-family:Arial">Unrealized gain on commodity and foreign currency contracts</P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">2,521</P>
</TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">863</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=399.4><P style="margin:0pt; text-indent:9pt; font-family:Arial">Prepaid expenses</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">2,554</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,935</P>
</TD></TR>
<TR><TD width=399.4><P style="margin:0pt; font-family:Arial">Total Current Assets</P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">245,542</P>
</TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">102,129</P>
</TD></TR>
<TR><TD valign=top width=399.4>&nbsp;</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; font-family:Arial">Mineral property, plant and equipment, net (note 6)</P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">108,615</P>
</TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">99,815</P>
</TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; font-family:Arial">Construction in progress (note 7)</P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">74,142</P>
</TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">34,306</P>
</TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; font-family:Arial">Investment in non-producing properties (note 7)</P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">179,870</P>
</TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">123,259</P>
</TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; font-family:Arial">Direct smelting ore (note 4)</P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">2,030</P>
</TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">2,236</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=399.4><P style="margin:0pt; font-family:Arial">Other assets</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,878</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">535</P>
</TD></TR>
<TR><TD style="border-bottom:2pt double #000000" width=399.4><P style="margin:0pt; font-family:Arial"><B>Total Assets</B></P>
</TD><TD style="border-bottom:2pt double #000000" width=24.267><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right><b>$</b></P>
</TD><TD style="border-bottom:2pt double #000000" width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>612,077</b></P>
</TD><TD style="border-bottom:2pt double #000000" width=29.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right><b>$</b></P>
</TD><TD style="border-bottom:2pt double #000000" width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>362,280</b></P>
</TD></TR>
<TR><TD valign=top width=399.4>&nbsp;</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right><BR></P>
</TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right><BR></P>
</TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; font-family:Arial"><B>Liabilities</B></P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right><BR></P>
</TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right><BR></P>
</TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; font-family:Arial">Current</P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right><BR></P>
</TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right><BR></P>
</TD></TR>
<TR><TD width=399.4><P style="margin:0pt; text-indent:9pt; font-family:Arial">Accounts payable and accrued liabilities</P>
</TD><TD width=24.267><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">31,377</P>
</TD><TD width=29.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">21,886</P>
</TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; text-indent:9pt; font-family:Arial">Advances for metal shipments</P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>2,202</P>
</TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>-</P>
</TD></TR>
<TR><TD width=399.4><P style="margin:0pt; text-indent:9pt; font-family:Arial">Unrealized loss on commodity contracts</P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">9,691</P>
</TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">4,810</P>
</TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; text-indent:9pt; font-family:Arial">Taxes payable</P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>11,651</P>
</TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>447</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=399.4><P style="margin:0pt; text-indent:9pt; font-family:Arial">Current portion of non-current liabilities</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>1,673</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>223</P>
</TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; font-family:Arial">Total Current Liabilities</P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>56,594</P>
</TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>27,366</P>
</TD></TR>
<TR><TD valign=top width=399.4>&nbsp;</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right><BR></P>
</TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right><BR></P>
</TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; font-family:Arial">Liability component of convertible debentures</P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>108</P>
</TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>126</P>
</TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; font-family:Arial">Provision for asset retirement obligations and reclamation (note 8)</P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>41,676</P>
</TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>39,378</P>
</TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; font-family:Arial">Provision for future income taxes</P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>43,323</P>
</TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>32,396</P>
</TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; font-family:Arial">Other liabilities and provisions</P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>66</P>
</TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>1,894</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=399.4><P style="margin:0pt; font-family:Arial">Non-controlling interest</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>7,401</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>3,798</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" width=399.4><P style="margin:0pt; font-family:Arial"><B>Total Liabilities</B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>&nbsp;</b></p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>149,168</b></P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>&nbsp;</b></p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>104,958</b></P>
</TD></TR>
<TR><TD valign=top width=399.4>&nbsp;</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; font-family:Arial"><B>Shareholders&#146; Equity</B></P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; font-family:Arial">Share capital (note 9)</P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; text-indent:9pt; font-family:Arial">Authorized:</P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; text-indent:18pt; font-family:Arial">200,000,000 common shares of no par value</P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; text-indent:9pt; font-family:Arial">Issued:</P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; text-indent:18pt; font-family:Arial">December 31, 2005 &nbsp;- 67,564,903 common shares</P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; text-indent:18pt; font-family:Arial">June 30, 2006 &#150; &nbsp;&nbsp;&nbsp;76,000,173 &nbsp;&nbsp;common shares</P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>582,020</P>
</TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>388,830</P>
</TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; text-indent:18pt; font-family:Arial">Equity component of convertible debentures</P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>712</P>
</TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>762</P>
</TD></TR>
<TR><TD valign=top width=399.4><P style="margin:0pt; text-indent:18pt; font-family:Arial">Additional paid in capital</P>
</TD><TD width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>13,387</P>
</TD><TD width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>13,117</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=399.4><P style="margin:0pt; text-indent:18pt; font-family:Arial">Deficit</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>(133,210)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>(145,387)</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=399.4><P style="margin:0pt; font-family:Arial"><B>Total Shareholders&#146; Equity</B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=24.267>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>&nbsp;</b></p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right><b>462,909</b></P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=29.333>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>&nbsp;</b></p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right><b>257,322</b></P>
</TD></TR>
<TR><TD style="border-bottom:2pt double #000000" width=399.4><P style="margin:0pt; font-family:Arial"><B>Total Liabilities and Shareholders&#146; Equity</B></P>
</TD><TD style="border-bottom:2pt double #000000" width=24.267><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right><b>$</b></P>
</TD><TD style="border-bottom:2pt double #000000" width=101.733><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right><b>612,077</b></P>
</TD><TD style="border-bottom:2pt double #000000" width=29.333><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right><b>$</b></P>
</TD><TD style="border-bottom:2pt double #000000" width=89><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right><b>362,280</b></P>
</TD></TR>
</TABLE>
<P style="margin:0pt"><BR></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=482.75></TD></TR>
<TR><TD valign=top width=643.667><P style="margin:0pt; font-family:Arial" align=right>See accompanying notes to consolidated financial statements</P>
</TD></TR>
</TABLE>
<A NAME="OLE_LINK4"></A><A NAME="OLE_LINK5"></A><P style="margin:0pt"><BR>
<BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">9</P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="margin:0pt; page-break-before:always"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align=center><B>Pan American Silver Corp.</B></P>
<P style="margin:0pt; font-family:Arial" align=center>Consolidated Statements of Operations</P>
<P style="margin:0pt; font-family:Arial" align=center>(Unaudited - in thousands of US Dollars, except for per share amounts)</P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<TABLE style="font-size: 10pt" cellspacing=0 height="895" width="751"><TR><TD width=297 height="18"></TD><TD width=19 height="18"></TD><TD width=79 height="18"></TD><TD width=19 height="18"></TD><TD width=79 height="18"></TD><TD width=45 height="18"></TD><TD width=79 height="18"></TD><TD width=19 height="18"></TD><TD width=79 height="18"></TD></TR>
<TR><TD valign=bottom width=297 height="18">&nbsp;</TD><TD valign=top width=208 colspan=4 height="18"><P style="margin:0pt; font-family:Arial" align=center><B>Three months ended</B></P>
</TD><TD valign=bottom width=234 colspan=4 height="18"><P style="margin:0pt; font-family:Arial" align=center><B>Six months ended</B></P>
</TD></TR>
<TR><TD valign=bottom width=297 height="18">&nbsp;</TD><TD valign=top width=208 colspan=4 height="18"><P style="margin:0pt; font-family:Arial" align=center><B>June 30,</B></P>
</TD><TD valign=bottom width=234 colspan=4 height="18"><P style="margin:0pt; font-family:Arial" align=center><B>June 30,</B></P>
</TD></TR>
<TR><TD style="border-bottom: 0.5pt solid #000000" valign=bottom width=299 height="17">&nbsp;</TD><TD style="border-bottom: 0.5pt solid #000000" valign=top width=104 colspan=2 height="17"><P style="margin:0pt; font-family:Arial" align=center><B>2006</B></P>
</TD><TD style="border-bottom: 0.5pt solid #000000" valign=top width=104 colspan=2 height="17"><P style="margin:0pt; font-family:Arial" align=center><B>2005</B></P>
</TD><TD style="border-bottom: 0.5pt solid #000000" valign=bottom width=130 colspan=2 height="17"><P style="margin:0pt; font-family:Arial" align=center><B>2006</B></P>
</TD><TD style="border-bottom: 0.5pt solid #000000" valign=bottom width=104 colspan=2 height="17"><P style="margin:0pt; font-family:Arial" align=center><B>2005</B></P>
</TD></TR>
<TR><TD valign=bottom width=297 height="34">&nbsp;</TD><TD valign=top width=19 height="34">&nbsp;</TD><TD valign=top width=79 height="34">&nbsp;</TD><TD valign=top width=19 height="34">&nbsp;</TD><TD valign=top width=79 height="34">&nbsp;</TD><TD valign=bottom width=45 height="34">&nbsp;</TD><TD valign=bottom width=79 height="34"><P style="margin:0pt"><BR></P>
</TD><TD valign=bottom width=19 height="34">&nbsp;</TD><TD valign=bottom width=79 height="34"><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=bottom width=297 height="26"><P style="line-height:18pt; margin:0pt; font-family:Arial">Sales</P>
</TD><TD valign=bottom width=19 height="26"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=bottom width=79 height="26"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">62,848</P>
</TD><TD valign=bottom width=19 height="26"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=bottom width=79 height="26"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">25,358</P>
</TD><TD valign=bottom width=45 height="26"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=bottom width=79 height="26"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>108,592</P>
</TD><TD valign=bottom width=19 height="26"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=bottom width=79 height="26"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>54,444</P>
</TD></TR>
<TR><TD valign=bottom width=297 height="18"><P style="margin:0pt; font-family:Arial">Cost of Sales</P>
</TD><TD valign=top width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(27,613)</P>
</TD><TD valign=top width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(18,417)</P>
</TD><TD valign=bottom width=45 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>(51,910)</P>
</TD><TD valign=bottom width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>(40,797)</P>
</TD></TR>
<TR><TD style="border-bottom: 0.5pt solid #000000" valign=bottom width=299 height="17"><P style="margin:0pt; font-family:Arial">Depreciation and amortization</P>
</TD><TD style="border-bottom: 0.5pt solid #000000" valign=top width=21 height="17">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom: 0.5pt solid #000000" valign=top width=81 height="17"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(4,175)</P>
</TD><TD style="border-bottom: 0.5pt solid #000000" valign=top width=21 height="17">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom: 0.5pt solid #000000" valign=top width=81 height="17"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(2,415)</P>
</TD><TD style="border-bottom: 0.5pt solid #000000" valign=bottom width=47 height="17">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom: 0.5pt solid #000000" valign=bottom width=81 height="17"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>(7,646)</P>
</TD><TD style="border-bottom: 0.5pt solid #000000" valign=bottom width=21 height="17">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom: 0.5pt solid #000000" valign=bottom width=81 height="17"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>(5,633)</P>
</TD></TR>
<TR><TD valign=bottom width=297 height="18"><P style="margin:0pt; font-family:Arial"><B>Mine operating earnings</B></P>
</TD><TD valign=top width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>&nbsp;</b></p>
  </TD><TD valign=top width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>31,060</b></P>
</TD><TD valign=top width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>&nbsp;</b></p>
  </TD><TD valign=top width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>4,526</b></P>
</TD><TD valign=bottom width=45 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>&nbsp;</b></p>
  </TD><TD valign=bottom width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right><b>49,036</b></P>
</TD><TD valign=bottom width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>&nbsp;</b></p>
  </TD><TD valign=bottom width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right><b>8,014</b></P>
</TD></TR>
<TR><TD valign=bottom width=297 height="34">&nbsp;</TD><TD valign=top width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=45 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right><BR></P>
</TD><TD valign=bottom width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right><BR></P>
</TD></TR>
<TR><TD valign=bottom width=297 height="34"><P style="margin:0pt; font-family:Arial">General and administrative, including stock-based</P>
<P style="margin:0pt; font-family:Arial">&nbsp;&nbsp;&nbsp;compensation</P>
</TD><TD valign=top width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">2,416</P>
</TD><TD width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,751</P>
</TD><TD width=45 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>4,349</P>
</TD><TD width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>3,313</P>
</TD></TR>
<TR><TD valign=bottom width=297 height="18"><P style="margin:0pt; font-family:Arial">Exploration</P>
</TD><TD valign=top width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">637</P>
</TD><TD valign=top width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">882</P>
</TD><TD valign=bottom width=45 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>1,871</P>
</TD><TD valign=bottom width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>2,309</P>
</TD></TR>
<TR><TD valign=bottom width=297 height="18"><P style="margin:0pt; font-family:Arial">Asset retirement and reclamation</P>
</TD><TD valign=top width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">614</P>
</TD><TD valign=top width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">412</P>
</TD><TD valign=bottom width=45 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>1,228</P>
</TD><TD valign=bottom width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>939</P>
</TD></TR>
<TR><TD style="border-top: 0.5pt solid #000000; border-bottom: 0.5pt solid #000000" valign=bottom width=299 height="18"><P style="margin:0pt; font-family:Arial">Operating earnings</P>
</TD><TD style="border-top: 0.5pt solid #000000; border-bottom: 0.5pt solid #000000" valign=top width=21 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-top: 0.5pt solid #000000; border-bottom: 0.5pt solid #000000" valign=top width=81 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">27,393</P>
</TD><TD style="border-top: 0.5pt solid #000000; border-bottom: 0.5pt solid #000000" valign=top width=21 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-top: 0.5pt solid #000000; border-bottom: 0.5pt solid #000000" valign=top width=81 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,481</P>
</TD><TD style="border-top: 0.5pt solid #000000; border-bottom: 0.5pt solid #000000" valign=bottom width=47 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-top: 0.5pt solid #000000; border-bottom: 0.5pt solid #000000" valign=bottom width=81 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>41,588</P>
</TD><TD style="border-top: 0.5pt solid #000000; border-bottom: 0.5pt solid #000000" valign=bottom width=21 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-top: 0.5pt solid #000000; border-bottom: 0.5pt solid #000000" valign=bottom width=81 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>1,453</P>
</TD></TR>
<TR><TD valign=bottom width=297 height="18"><P style="margin:0pt; font-family:Arial">Interest and financing expenses</P>
</TD><TD valign=top width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(203)</P>
</TD><TD valign=top width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(93)</P>
</TD><TD valign=bottom width=45 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>(349)</P>
</TD><TD valign=bottom width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>(186)</P>
</TD></TR>
<TR><TD valign=bottom width=297 height="18"><P style="margin:0pt; font-family:Arial">Investment and other income</P>
</TD><TD valign=top width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,083</P>
</TD><TD valign=top width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">990</P>
</TD><TD valign=bottom width=45 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>1,340</P>
</TD><TD valign=bottom width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>1,248</P>
</TD></TR>
<TR><TD valign=bottom width=297 height="50"><P style="margin:0pt; font-family:Arial">(Loss) gain on commodity and foreign currency</P>
<P style="margin:0pt; font-family:Arial">&nbsp;&nbsp;&nbsp;contract</P>
</TD><TD valign=top width=19 height="50">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="50"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(4,780)</P>
</TD><TD valign=bottom width=19 height="50">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="50"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">3,491</P>
</TD><TD valign=bottom width=45 height="50">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="50"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>(16,610)</P>
</TD><TD valign=bottom width=19 height="50">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="50"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>154</P>
</TD></TR>
<TR><TD style="border-top: 0.5pt solid #000000" width=299 height="17"><P style="margin:0pt; font-family:Arial">Income before taxes and non-controlling interest</P>
</TD><TD style="border-top: 0.5pt solid #000000" width=21 height="17">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-top: 0.5pt solid #000000" width=81 height="17"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">23,493</P>
</TD><TD style="border-top: 0.5pt solid #000000" width=21 height="17">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-top: 0.5pt solid #000000" width=81 height="17"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">5,869</P>
</TD><TD style="border-top: 0.5pt solid #000000" width=47 height="17">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-top: 0.5pt solid #000000" width=81 height="17"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>25,969</P>
</TD><TD style="border-top: 0.5pt solid #000000" width=21 height="17">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-top: 0.5pt solid #000000" width=81 height="17"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>2,669</P>
</TD></TR>
<TR><TD valign=bottom width=297 height="18"><P style="margin:0pt; font-family:Arial">Income tax provision</P>
</TD><TD valign=top width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(7,577)</P>
</TD><TD valign=top width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(746)</P>
</TD><TD valign=bottom width=45 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>(11,590)</P>
</TD><TD valign=bottom width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>(1,688)</P>
</TD></TR>
<TR><TD style="border-bottom: 0.5pt solid #000000" valign=bottom width=299 height="17"><P style="margin:0pt; font-family:Arial">Non-controlling interest</P>
</TD><TD style="border-bottom: 0.5pt solid #000000" valign=top width=21 height="17">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom: 0.5pt solid #000000" valign=top width=81 height="17"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(952)</P>
</TD><TD style="border-bottom: 0.5pt solid #000000" valign=top width=21 height="17">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom: 0.5pt solid #000000" valign=top width=81 height="17"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(152)</P>
</TD><TD style="border-bottom: 0.5pt solid #000000" valign=bottom width=47 height="17">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom: 0.5pt solid #000000" valign=bottom width=81 height="17"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(2,176)</P>
</TD><TD style="border-bottom: 0.5pt solid #000000" valign=bottom width=21 height="17">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom: 0.5pt solid #000000" valign=bottom width=81 height="17"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(233)</P>
</TD></TR>
<TR><TD style="border-bottom: 2pt double #000000" valign=bottom width=299 height="19"><P style="margin:0pt; font-family:Arial"><B>Net income for the period</B></P>
</TD><TD style="border-bottom: 2pt double #000000" valign=top width=21 height="19"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>$</b></P>
</TD><TD style="border-bottom: 2pt double #000000" valign=top width=81 height="19"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>14,964</b></P>
</TD><TD style="border-bottom: 2pt double #000000" valign=top width=21 height="19"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>$</b></P>
</TD><TD style="border-bottom: 2pt double #000000" valign=top width=81 height="19"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>4,971</b></P>
</TD><TD style="border-bottom: 2pt double #000000" valign=bottom width=47 height="19"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right><b>$</b></P>
</TD><TD style="border-bottom: 2pt double #000000" valign=bottom width=81 height="19"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>12,203</b></P>
</TD><TD style="border-bottom: 2pt double #000000" valign=bottom width=21 height="19"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right><b>$</b></P>
</TD><TD style="border-bottom: 2pt double #000000" valign=bottom width=81 height="19"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>748</b></P>
</TD></TR>
<TR><TD valign=bottom width=297 height="34">&nbsp;</TD><TD valign=top width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=45 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=bottom width=297 height="34">&nbsp;</TD><TD valign=top width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=45 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=bottom width=297 height="34"><P style="margin:0pt; font-family:Arial">Attributable to common shareholders:</P>
</TD><TD valign=top width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=45 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=bottom width=297 height="34">&nbsp;</TD><TD valign=top width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=45 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=bottom width=297 height="18"><P style="margin:0pt; font-family:Arial">Net income for the period</P>
</TD><TD valign=top width=19 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">14,964</P>
</TD><TD valign=top width=19 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">4,971</P>
</TD><TD valign=bottom width=45 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">12,203</P>
</TD><TD valign=bottom width=19 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">748</P>
</TD></TR>
<TR><TD valign=bottom width=297 height="18"><P style="margin:0pt; font-family:Arial">Accretion of convertible debentures</P>
</TD><TD valign=top width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(13)</P>
</TD><TD valign=top width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=bottom width=45 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(26)</P>
</TD><TD valign=bottom width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(3)</P>
</TD></TR>
<TR><TD style="border-top: 0.5pt solid #000000; border-bottom: 1.5pt solid #000000" valign=top width=299 height="19"><P style="margin:0pt; text-indent:-236.85pt; font-family:Arial">Adjusted net income for the period attributable to common shareholders</P>
</TD><TD style="border-top: 0.5pt solid #000000; border-bottom: 1.5pt solid #000000" valign=top width=21 height="19"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-top: 0.5pt solid #000000; border-bottom: 1.5pt solid #000000" width=81 height="19"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">14,951</P>
</TD><TD style="border-top: 0.5pt solid #000000; border-bottom: 1.5pt solid #000000" width=21 height="19"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-top: 0.5pt solid #000000; border-bottom: 1.5pt solid #000000" width=81 height="19"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">4,971</P>
</TD><TD style="border-top: 0.5pt solid #000000; border-bottom: 1.5pt solid #000000" width=47 height="19"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-top: 0.5pt solid #000000; border-bottom: 1.5pt solid #000000" width=81 height="19"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">12,177</P>
</TD><TD style="border-top: 0.5pt solid #000000; border-bottom: 1.5pt solid #000000" width=21 height="19"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-top: 0.5pt solid #000000; border-bottom: 1.5pt solid #000000" width=81 height="19"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">745</P>
</TD></TR>
<TR><TD valign=bottom width=297 height="34">&nbsp;</TD><TD valign=top width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=45 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=bottom width=297 height="15"><P style="margin:0pt; font-family:Arial">Basic income per share </P>
</TD><TD valign=top width=19 height="15"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=79 height="15"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>0.21</P>
</TD><TD valign=top width=19 height="15"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=79 height="15"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>0.07</P>
</TD><TD valign=bottom width=45 height="15"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=79 height="15"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>0.17</P>
</TD><TD valign=bottom width=19 height="15"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=79 height="15"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.01</P>
</TD></TR>
<TR><TD valign=bottom width=297 height="18"><P style="margin:0pt; font-family:Arial">Diluted income per share</P>
</TD><TD valign=top width=19 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>0.20</P>
</TD><TD valign=top width=19 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>0.07</P>
</TD><TD valign=bottom width=45 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>0.16</P>
</TD><TD valign=bottom width=19 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=bottom width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align=right>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.01</P>
</TD></TR>
<TR><TD valign=bottom width=297 height="34">&nbsp;</TD><TD valign=top width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=45 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=bottom width=297 height="34"><P style="margin:0pt; font-family:Arial">Weighted average number of shares outstanding (000&#146;s)</P>
</TD><TD valign=top width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=128 colspan=2 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=19 height="34">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="34"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=bottom width=297 height="18"><P style="margin:0pt; font-family:Arial">&nbsp;&nbsp;Basic</P>
</TD><TD valign=top width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">71,174</P>
</TD><TD valign=top width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">66,927</P>
</TD><TD valign=bottom width=45 height="18">
</TD><TD valign=bottom width=79><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">71,138</P>
</TD><TD valign=bottom width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">66,906</P>
</TD></TR>
<TR><TD valign=bottom width=297 height="18"><P style="margin:0pt; font-family:Arial">&nbsp;&nbsp;Diluted</P>
</TD><TD valign=top width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">75,869</P>
</TD><TD valign=top width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">71,553</P>
</TD><TD valign=bottom width=45 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">75,833</P>
</TD><TD valign=bottom width=19 height="18">
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=79 height="18"><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">71,532</P>
</TD></TR>
</TABLE>
<P style="margin:0pt"><BR></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=495></TD></TR>
<TR><TD width=660><P style="margin:0pt; font-family:Arial" align=right>See accompanying notes to consolidated financial statements</P>
</TD></TR>
</TABLE>
<P style="margin:0pt"><BR></P>
<A NAME="OLE_LINK1"></A><P style="margin:0pt" align=center><BR>
<BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">10</P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="margin:0pt; page-break-before:always"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align=center><B>Pan American Silver Corp.</B></P>
<P style="margin:0pt; font-family:Arial" align=center>Consolidated Statement of Cash Flows</P>
<P style="margin:0pt; font-family:Arial" align=center>(Unaudited &#150; in thousands of US dollars)</P>
<P style="margin:0pt"><BR></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=1.5></TD><TD width=243></TD><TD width=9></TD><TD width=54></TD><TD width=9></TD><TD width=54></TD><TD width=9></TD><TD width=54></TD><TD width=9></TD><TD width=54></TD></TR>
<TR><TD valign=top width=326 colspan=2>&nbsp;</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=156 colspan=3><P style="margin:0pt; font-family:Arial" align=center><B>Three months ended</B></P>
</TD><TD width=168 colspan=4><P style="margin:0pt; font-family:Arial" align=center><B>Six months ended</B></P>
</TD></TR>
<TR><TD valign=top width=326 colspan=2>&nbsp;</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=156 colspan=3><P style="margin:0pt; font-family:Arial" align=center><B>June 30</B></P>
</TD><TD width=168 colspan=4><P style="margin:0pt; font-family:Arial" align=center><B>June 30</B></P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=326 colspan=2>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="margin:0pt; font-family:Arial" align=center><B>2006</B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=84 colspan=2><P style="margin:0pt; font-family:Arial" align=center><B>2005</B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=84 colspan=2><P style="margin:0pt; font-family:Arial" align=center><B>2006</B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=84 colspan=2><P style="margin:0pt; font-family:Arial" align=center><B>2005</B></P>
</TD></TR>
<TR><TD valign=bottom width=326 colspan=2><P style="margin-top:5pt; margin-bottom:0pt; font-family:Arial"><B>Operating activities</B></P>
</TD><TD valign=bottom width=12>&nbsp;</TD><TD valign=bottom width=72><P style="margin:0pt"><BR></P>
</TD><TD valign=bottom width=12>&nbsp;</TD><TD valign=bottom width=72><P style="margin:0pt"><BR></P>
</TD><TD valign=bottom width=12>&nbsp;</TD><TD valign=bottom width=72><P style="margin:0pt"><BR></P>
</TD><TD valign=bottom width=12>&nbsp;</TD><TD valign=bottom width=72><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=top width=326 colspan=2><P style="margin:0pt; font-family:Arial">Net loss income for the period</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">14,964</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">4,971</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">12,203</P>
</TD><TD valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">748</P>
</TD></TR>
<TR><TD valign=top width=326 colspan=2><P style="margin:0pt; font-family:Arial">Reclamation expenditures</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(113)</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(222)</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(395)</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(500)</P>
</TD></TR>
<TR><TD valign=top width=326 colspan=2><P style="margin:0pt; font-family:Arial">Items not involving cash:</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326 colspan=2><P style="margin:0pt; font-family:Arial">&nbsp;Depreciation and amortization</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">4,175</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">2,415</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">7,646</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">5,633</P>
</TD></TR>
<TR><TD valign=top width=326 colspan=2><P style="margin:0pt; padding-left:9pt; text-indent:-9pt; font-family:Arial">&nbsp;Asset retirement and reclamation</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">614</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">412</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,228</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">939</P>
</TD></TR>
<TR><TD valign=top width=326 colspan=2><P style="margin:0pt; font-family:Arial">&nbsp;Gain on sale of assets</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(184)</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(184)</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD></TR>
<TR><TD valign=top width=326 colspan=2><P style="margin:0pt; font-family:Arial">&nbsp;Future income taxes</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(974)</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(255)</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(1,583)</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(305)</P>
</TD></TR>
<TR><TD valign=top width=326 colspan=2><P style="margin:0pt; font-family:Arial">&nbsp;Non-controlling interest</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">952</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">152</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">2,176</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">233</P>
</TD></TR>
<TR><TD valign=top width=326 colspan=2><P style="margin:0pt; font-family:Arial">&nbsp;Unrealized (loss) gain on commodity and foreign &nbsp;currency contracts</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(3,560)</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(5,251)</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">3,223</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(3,339)</P>
</TD></TR>
<TR><TD valign=top width=326 colspan=2><P style="margin:0pt; font-family:Arial">&nbsp;Stock-based compensation</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">751</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">705</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,222</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,002</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=326 colspan=2><P style="margin:0pt; padding-left:9pt; text-indent:-9pt; font-family:Arial">Changes in non-cash operating working capital items (note 10)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">12,602</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(1,549)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">11,208</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(175)</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" width=326 colspan=2><P style="margin:0pt; font-family:Arial"><B>Cash generated by operations</B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>&nbsp;</b></p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>29,227</b></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>&nbsp;</b></p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>1,378</b></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>&nbsp;</b></p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>36,744</b></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>&nbsp;</b></p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>4,236</b></P>
</TD></TR>
<TR><TD valign=bottom width=326 colspan=2>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326 colspan=2><P style="margin:0pt; font-family:Arial"><B>Investing activities</B></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326 colspan=2><P style="margin:0pt; font-family:Arial">&nbsp;&nbsp;Mineral property, plant and equipment expenditures</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(36,985)</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(14,246)</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(53,246)</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(24,249)</P>
</TD></TR>
<TR><TD valign=top width=326 colspan=2><P style="margin:0pt; font-family:Arial">&nbsp;&nbsp;(Purchase) sale of short-term investments</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(116,305)</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">18,466</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(96,385)</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">13,798</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=326 colspan=2><P style="margin:0pt; font-family:Arial">&nbsp;&nbsp;Other</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(167)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(48)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(167)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">402</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" width=326 colspan=2><P style="margin:0pt; font-family:Arial"><B>Cash (used in) generated by investing activities</B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>&nbsp;</b></p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>(153,457)</b></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>&nbsp;</b></p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>4,172</b></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>&nbsp;</b></p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>(149,798)</b></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>&nbsp;</b></p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>(10,049)</b></P>
</TD></TR>
<TR><TD valign=bottom width=326 colspan=2>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326 colspan=2><P style="margin:0pt; font-family:Arial"><B>Financing activities</B></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326 colspan=2><P style="margin:0pt; font-family:Arial">&nbsp;&nbsp;Shares issued for cash</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">150,260</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">282</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">152,344</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,201</P>
</TD></TR>
<TR><TD valign=top width=326 colspan=2><P style="margin:0pt; font-family:Arial">&nbsp;&nbsp;Share issue costs</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(7,845)</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(7,845)</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD></TR>
<TR><TD valign=top width=326 colspan=2><P style="margin:0pt; font-family:Arial">&nbsp;&nbsp;Interest paid on convertible debentures</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(19)</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=326 colspan=2><P style="margin:0pt; font-family:Arial">&nbsp;&nbsp;Proceeds from (repayment of) short-term loan</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">2,202</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(285)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">2,202</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(285)</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" width=326 colspan=2><P style="margin:0pt; font-family:Arial"><B>Cash generated by (used in) financing activities</B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>&nbsp;</b></p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>144,617</b></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>&nbsp;</b></p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>(3)</b></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>&nbsp;</b></p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>146,682</b></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>&nbsp;</b></p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>916</b></P>
</TD></TR>
<TR><TD valign=bottom width=326 colspan=2>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=top width=326 colspan=2><P style="margin:0pt; padding-left:9.35pt; text-indent:-9.35pt; font-family:Arial">Increase/(decrease) in cash and cash equivalents during the period</P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">20,387</P>
</TD><TD width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">5,547</P>
</TD><TD width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">33,628</P>
</TD><TD width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(4,897)</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=326 colspan=2><P style="margin:0pt; font-family:Arial">Cash and cash equivalents, beginning of period</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">42,532</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">17,901</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">29,291</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">28,345</P>
</TD></TR>
<TR><TD style="border-bottom:2pt double #000000" width=326 colspan=2><P style="margin:0pt; font-family:Arial"><B>Cash and cash equivalents, end of period</B></P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>$</b></P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>62,919</b></P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>$</b></P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>23,448</b></P>
</TD><TD style="border-bottom:2pt double #000000" valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>$</b></P>
</TD><TD style="border-bottom:2pt double #000000" valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>62,919</b></P>
</TD><TD style="border-bottom:2pt double #000000" valign=bottom width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>$</b></P>
</TD><TD style="border-bottom:2pt double #000000" valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><b>23,448</b></P>
</TD></TR>
<TR><TD valign=bottom width=326 colspan=2>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD valign=bottom width=326 colspan=2>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD width=326 colspan=2><P style="margin:0pt; font-family:Arial"><B>Supplementary Disclosures</B></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD width=326 colspan=2><P style="margin:0pt; font-family:Arial">Interest paid</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD style="border-bottom:2pt double #000000" width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-bottom:2pt double #000000" width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">19</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-bottom:2pt double #000000" width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">18</P>
</TD></TR>
<TR><TD width=326 colspan=2>&nbsp;</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=top width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD valign=bottom width=12>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=bottom width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD></TR>
<TR><TD width=326 colspan=2><P style="margin:0pt; font-family:Arial">Taxes paid</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">2,317</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">2,906</P>
</TD><TD style="border-bottom:2pt double #000000" width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-bottom:2pt double #000000" width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">3,749</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=12><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-bottom:2pt double #000000" width=72><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">3,111</P>
</TD></TR>
<TR><TD valign=bottom width=326 colspan=2>&nbsp;</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=72><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=72><P style="margin:0pt"><BR></P>
</TD><TD width=12>&nbsp;</TD><TD width=72><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=12>&nbsp;</TD><TD width=72><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD width=2>&nbsp;</TD><TD valign=top width=660 colspan=9><P style="margin:0pt; padding-right:-5.4pt; font-family:Arial" align=right>See accompanying notes to consolidated financial statements</P>
</TD></TR>
</TABLE>
<P style="margin:0pt" align=center><BR>
<BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">11</P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="margin:0pt; page-break-before:always"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align=center><B>PAN AMERICAN SILVER CORP.</B></P>
<P style="margin:0pt; font-family:Arial" align=center>Consolidated Statements of Shareholders&#146; Equity<BR>
(in thousands of US dollars, except for amounts of shares)</P>
<P style="margin:0pt" align=center><BR></P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=143.3></TD><TD width=27.95></TD><TD width=45.05></TD><TD width=1.55></TD><TD width=9></TD><TD width=20.05></TD><TD width=14.35></TD><TD width=9.05></TD><TD width=50.2></TD><TD width=11.85></TD><TD width=5.95></TD><TD width=43></TD><TD width=10.1></TD><TD width=45.3></TD><TD width=10.85></TD><TD width=40.45></TD><TD width=7.3></TD></TR>
<TR><TD width=228.333 colspan=2>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" width=120 colspan=5><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Common Shares</P>
</TD><TD width=79 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Convertible</P>
</TD><TD width=81.067 colspan=3><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Additional</P>
</TD><TD width=73.867 colspan=2>&nbsp;</TD><TD width=78.133 colspan=3>&nbsp;</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" width=228.333 colspan=2>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" width=60.067><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Shares</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=59.933 colspan=4><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Amount</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=79 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Debentures</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=81.067 colspan=3><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Paid in Capital</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=73.867 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Deficit</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=78.133 colspan=3><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Total</P>
</TD></TR>
<TR><TD width=228.333 colspan=2><P style="line-height:11pt; margin:0pt; padding-left:8.8pt; text-indent:-8.8pt; font-family:Arial; font-size:9pt">Balance, December 31, 2004</P>
</TD><TD width=62.133 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>66,835,378</P>
</TD><TD width=12><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD width=45.867 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>380,571</P>
</TD><TD width=12.067><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD width=66.933><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">633</P>
</TD><TD width=15.8><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD width=65.267 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">10,976</P>
</TD><TD width=13.467><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD width=60.4><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">(116,664)</P>
</TD><TD width=14.467><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD width=63.667 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">275,516</P>
</TD></TR>
<TR><TD width=228.333 colspan=2><P style="line-height:11pt; margin:0pt; padding-left:8.8pt; text-indent:0.2pt; font-family:Arial; font-size:9pt">Issued on the exercise of stock options</P>
</TD><TD width=62.133 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>693,933</P>
</TD><TD width=12>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=45.867 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>7,751</P>
</TD><TD valign=top width=12.067>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=66.933><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD valign=top width=15.8>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=65.267 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">(1,403)</P>
</TD><TD valign=top width=13.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=60.4><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD valign=top width=14.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=63.667 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">6,348</P>
</TD></TR>
<TR><TD width=228.333 colspan=2><P style="line-height:11pt; margin:0pt; padding-left:8.8pt; text-indent:0.2pt; font-family:Arial; font-size:9pt">Issued on the exercise of share purchase warrants</P>
</TD><TD width=62.133 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>1,320</P>
</TD><TD width=12>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=45.867 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>18</P>
</TD><TD valign=top width=12.067>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=66.933><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD valign=top width=15.8>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=65.267 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">(5)</P>
</TD><TD width=13.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=60.4><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD valign=top width=14.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=63.667 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">13</P>
</TD></TR>
<TR><TD width=228.333 colspan=2><P style="line-height:11pt; margin:0pt; padding-left:8.8pt; text-indent:0.2pt; font-family:Arial; font-size:9pt">Stock-based compensation on options granted</P>
</TD><TD width=62.133 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD valign=top width=12>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=45.867 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD valign=top width=12.067>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=66.933><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD valign=top width=15.8>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=65.267 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">1,460</P>
</TD><TD valign=top width=13.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=60.4><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD valign=top width=14.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=63.667 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">1,460</P>
</TD></TR>
<TR><TD width=228.333 colspan=2><P style="line-height:11pt; margin:0pt; padding-left:8.8pt; text-indent:0.2pt; font-family:Arial; font-size:9pt">Issued to settle obligation</P>
</TD><TD width=62.133 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD width=12>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=45.867 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD valign=top width=12.067>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=66.933><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD valign=top width=15.8>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=65.267 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">2,100</P>
</TD><TD valign=top width=13.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=60.4><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD valign=top width=14.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=63.667 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">2,100</P>
</TD></TR>
<TR><TD width=228.333 colspan=2><P style="line-height:11pt; margin:0pt; padding-left:8.8pt; text-indent:0.2pt; font-family:Arial; font-size:9pt">Accretion of convertible debentures</P>
</TD><TD valign=top width=62.133 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD valign=top width=12>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=45.867 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD valign=top width=12.067>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=66.933><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">129</P>
</TD><TD valign=top width=15.8>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=65.267 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">-</P>
</TD><TD valign=top width=13.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=60.4><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">(129)</P>
</TD><TD valign=top width=14.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=63.667 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD></TR>
<TR><TD width=228.333 colspan=2><P style="line-height:11pt; margin:0pt; padding-left:8.8pt; text-indent:0.2pt; font-family:Arial; font-size:9pt">Issued as compensation</P>
</TD><TD width=62.133 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>34,272</P>
</TD><TD width=12>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=45.867 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>490</P>
</TD><TD valign=top width=12.067>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=66.933><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD valign=top width=15.8>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=65.267 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">-</P>
</TD><TD valign=top width=13.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=60.4><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD valign=top width=14.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=63.667 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">490</P>
</TD></TR>
<TR><TD width=228.333 colspan=2><P style="line-height:11pt; margin:0pt; padding-left:8.8pt; text-indent:0.2pt; font-family:Arial; font-size:9pt">Other</P>
</TD><TD width=62.133 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD width=12>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=45.867 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD width=12.067>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=66.933><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD valign=top width=15.8>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=65.267 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">(11)</P>
</TD><TD valign=top width=13.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=60.4><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD valign=top width=14.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=63.667 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">(11)</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" width=228.333 colspan=2><P style="line-height:11pt; margin:0pt; padding-left:8.8pt; text-indent:0.2pt; font-family:Arial; font-size:9pt">Net loss for the year </P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=62.133 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=45.867 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12.067>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=66.933><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=15.8>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=65.267 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=13.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=60.4><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">(28,594)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=14.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=63.667 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">(28,594)</P>
</TD></TR>
<TR><TD width=228.333 colspan=2><P style="line-height:11pt; margin:0pt; padding-left:8.8pt; text-indent:-8.8pt; font-family:Arial; font-size:9pt">Balance, December 31, 2005</P>
</TD><TD width=62.133 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>67,564,903</P>
</TD><TD width=12>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=45.867 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>388,830</P>
</TD><TD width=12.067>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=66.933><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">762</P>
</TD><TD width=15.8>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=65.267 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">13,117</P>
</TD><TD width=13.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=60.4><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">(145,387)</P>
</TD><TD width=14.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=63.667 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">257,322</P>
</TD></TR>
<TR><TD width=228.333 colspan=2><P style="line-height:11pt; margin:0pt; padding-left:8.8pt; text-indent:0.2pt; font-family:Arial; font-size:9pt">Issued on the exercise of stock options</P>
</TD><TD width=62.133 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>159,308</P>
</TD><TD width=12>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=45.867 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>2,858</P>
</TD><TD width=12.067>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=66.933><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD width=15.8>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=65.267 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">(697)</P>
</TD><TD width=13.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=60.4><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align=right>-</P>
</TD><TD width=14.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=63.667 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">2,161</P>
</TD></TR>
<TR><TD width=228.333 colspan=2><P style="line-height:11pt; margin:0pt; padding-left:8.8pt; text-indent:0.2pt; font-family:Arial; font-size:9pt">Issued on the exercise of share &nbsp;&nbsp;&nbsp;purchase warrants</P>
</TD><TD width=62.133 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>11,535</P>
</TD><TD width=12>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=45.867 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>151</P>
</TD><TD width=12.067>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=66.933><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD width=15.8>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=65.267 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">(27)</P>
</TD><TD width=13.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=60.4><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align=right>-</P>
</TD><TD width=14.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=63.667 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">124</P>
</TD></TR>
<TR><TD width=228.333 colspan=2><P style="line-height:11pt; margin:0pt; padding-left:8.8pt; text-indent:0.2pt; font-family:Arial; font-size:9pt">Issued on the conversion of debentures</P>
</TD><TD width=62.133 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>6,789</P>
</TD><TD width=12>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=45.867 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>86</P>
</TD><TD width=12.067>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=66.933><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">(76)</P>
</TD><TD width=15.8>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=65.267 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">-</P>
</TD><TD width=13.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=60.4><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align=right>-</P>
</TD><TD width=14.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=63.667 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">10</P>
</TD></TR>
<TR><TD width=228.333 colspan=2><P style="line-height:11pt; margin:0pt; padding-left:8.8pt; text-indent:0.2pt; font-family:Arial; font-size:9pt">Issued as compensation</P>
</TD><TD width=62.133 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>26,231</P>
</TD><TD width=12>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=45.867 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>559</P>
</TD><TD width=12.067>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=66.933><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD width=15.8>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=65.267 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">70</P>
</TD><TD width=13.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=60.4><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align=right>-</P>
</TD><TD width=14.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=63.667 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">629</P>
</TD></TR>
<TR><TD width=228.333 colspan=2><P style="line-height:11pt; margin:0pt; padding-left:8.8pt; text-indent:0.2pt; font-family:Arial; font-size:9pt">Shares issued to acquire mineral interests</P>
</TD><TD width=62.133 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>1,950,000</P>
</TD><TD width=12>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=45.867 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>47,381</P>
</TD><TD width=12.067>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=66.933><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD width=15.8>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=65.267 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">-</P>
</TD><TD width=13.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=60.4><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align=right>-</P>
</TD><TD width=14.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=63.667 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">47,381</P>
</TD></TR>
<TR><TD width=228.333 colspan=2><P style="line-height:11pt; margin:0pt; padding-left:8.8pt; text-indent:0.2pt; font-family:Arial; font-size:9pt">Stock issued for cash</P>
</TD><TD width=62.133 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>6,281,407</P>
</TD><TD width=12>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=45.867 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>142,155</P>
</TD><TD width=12.067>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=66.933><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD width=15.8>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=65.267 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">-</P>
</TD><TD width=13.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=60.4><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align=right>-</P>
</TD><TD width=14.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=63.667 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">142,155</P>
</TD></TR>
<TR><TD width=228.333 colspan=2><P style="line-height:11pt; margin:0pt; padding-left:8.8pt; text-indent:0.2pt; font-family:Arial; font-size:9pt">Accretion of convertible debentures</P>
</TD><TD width=62.133 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD width=12>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=45.867 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD width=12.067>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=66.933><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">26</P>
</TD><TD width=15.8>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=65.267 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">-</P>
</TD><TD width=13.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=60.4><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">(26)</P>
</TD><TD width=14.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=63.667 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align=right>-</P>
</TD></TR>
<TR><TD width=228.333 colspan=2><P style="line-height:11pt; margin:0pt; padding-left:8.8pt; text-indent:0.2pt; font-family:Arial; font-size:9pt">Stock-based compensation on options granted</P>
</TD><TD width=62.133 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD width=12>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=45.867 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD width=12.067>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=66.933><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">-</P>
</TD><TD width=15.8>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=65.267 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">924</P>
</TD><TD width=13.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=60.4><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align=right>-</P>
</TD><TD width=14.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD width=63.667 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>924</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" width=228.333 colspan=2><P style="line-height:11pt; margin:0pt; padding-left:8.8pt; text-indent:0.2pt; font-family:Arial; font-size:9pt">Net income for the period</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=62.133 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=12>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=45.867 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=12.067>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=66.933><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=15.8>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=65.267 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=13.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=60.4><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">12,203</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=14.467>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">&nbsp;</p>
  </TD><TD style="border-bottom:0.5pt solid #000000" width=63.667 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">12,203</P>
</TD></TR>
<TR><TD style="border-bottom:2pt double #000000" width=228.333 colspan=2><P style="line-height:11pt; margin:0pt; padding-left:8.8pt; text-indent:-8.8pt; font-family:Arial; font-size:9pt">Balance, June 30, 2006</P>
</TD><TD style="border-bottom:2pt double #000000" width=62.133 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>76,000,173</P>
</TD><TD style="border-bottom:2pt double #000000" width=12><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" width=45.867 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>582,020</P>
</TD><TD style="border-bottom:2pt double #000000" width=12.067><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" width=66.933><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">712</P>
</TD><TD style="border-bottom:2pt double #000000" width=15.8><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" width=65.267 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">13,387</P>
</TD><TD style="border-bottom:2pt double #000000" width=13.467><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" width=60.4><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">(133,210)</P>
</TD><TD style="border-bottom:2pt double #000000" width=14.467><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" width=63.667 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt" align="right">462,909</P>
</TD></TR>
<TR><TD valign=top width=191.067>&nbsp;</TD><TD valign=top width=138.133 colspan=5>&nbsp;</TD><TD valign=top width=31.2 colspan=2>&nbsp;</TD><TD valign=top width=90.667 colspan=3>&nbsp;</TD><TD valign=top width=70.8 colspan=2>&nbsp;</TD><TD valign=top width=138.533 colspan=4>&nbsp;</TD></TR>
</TABLE>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR>
<BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">12</P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt; page-break-before:always"><B>Pan American Silver Corp.</B></P>
<P style="margin:0pt; font-family:Arial">Notes to Unaudited Interim Consolidated Financial Statements</P>
<P style="margin:0pt; font-family:Arial">As at June 30, 2006 and 2005 and for the three month periods then ended</P>
<P style="margin:0pt; font-family:Arial">(Tabular amounts are in thousands of US dollars, except for numbers of shares, price per share and per share amounts)</P>
<P style="margin:0pt; padding-top:3pt; border-top:0.5pt solid #000000"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="font-family: Arial; margin-top: 10pt; margin-bottom: -12pt"><B>1.</B></P>
<P style="margin-top:0pt; margin-bottom:10pt; padding-left:28.35pt; text-indent:7.65pt; font-family:Arial"><B>Nature of Operations</B></P>
<P style="margin-top:0pt; margin-bottom:10pt; font-family:Arial" align=justify>Pan American Silver Corp, subsidiary companies and joint ventures (collectively, the &#147;Company&#148; or &#147;Pan American&#148;) are engaged in silver mining and related activities, including exploration, extraction, processing, refining and reclamation. &nbsp;The Company&#146;s primary product (silver) is produced in Peru, Mexico and Bolivia, along with development activities in Argentina, Mexico and Bolivia, and exploration activities in South America.</P>
<P style="font-family: Arial; margin-top: 10pt; margin-bottom: -12pt"><B>2.</B></P>
<P style="margin-top:0pt; margin-bottom:10pt; padding-left:28.35pt; text-indent:7.65pt; font-family:Arial"><B>Summary of Significant Accounting Policies</B></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:56.7pt; text-indent:-28.35pt; font-family:Arial" align=justify><U>a)</U></P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:56.7pt; font-family:Arial" align=justify><U>Basis of Presentation:</U> The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in Canada for interim financial information and follow the same accounting policies and methods as our most recent annual financial statements. Accordingly, they do not include all the information and footnotes required by accounting principles generally accepted in Canada for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the three-month and six month periods ended June 30, 2006 and 2005 are not necessarily indicative of the results that may be expected for the year ending December 31, 2006. </P>
<P style="margin:0pt"><BR></P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:26.95pt; text-indent:1.4pt; font-family:Arial" align=justify>The consolidated balance sheet at December 31, 2005 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by accounting principles generally accepted in Canada for complete financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in the Pan American Silver Corp. (the &#147;Company&#148;) Annual Report for the year ended December 31, 2005. </P>
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<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:56.7pt; text-indent:-28.35pt; font-family:Arial" align=justify><U>b)</U></P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:56.7pt; font-family:Arial" align=justify><U>Principles of Consolidation:</U> The consolidated financial statements include the wholly-owned and partially-owned subsidiaries of the Company and joint ventures, the most significant of which are presented in the following table:</P>
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<div align="center">
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<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=147.2></TD><TD width=54.6></TD><TD width=52.5></TD><TD width=65.75></TD><TD width=123.9></TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" width=196.267><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Subsidiary</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=72.8><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Location</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=70><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Ownership interest</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=87.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Status</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=165.2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Operations and Development Projects</P>
</TD></TR>
<TR><TD valign=top width=196.267>&nbsp;</TD><TD valign=top width=72.8>&nbsp;</TD><TD valign=top width=70>&nbsp;</TD><TD valign=top width=87.667>&nbsp;</TD><TD valign=top width=165.2>&nbsp;</TD></TR>
<TR><TD valign=top width=196.267><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=justify>Pan American Silver S.A.C.</P>
</TD><TD valign=top width=72.8><P style="line-height:11pt; margin:0pt; padding-left:9.4pt; font-family:Arial; font-size:9pt">Peru</P>
</TD><TD valign=top width=70><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>100%</P>
</TD><TD valign=top width=87.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=justify>Consolidated</P>
</TD><TD valign=top width=165.2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=justify>Quiruvilca and Huaron Mines</P>
</TD></TR>
<TR><TD valign=top width=196.267><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=justify>Compa&#241;&#237;a Minera Argentum S.A.</P>
</TD><TD valign=top width=72.8><P style="line-height:11pt; margin:0pt; padding-left:9.4pt; font-family:Arial; font-size:9pt">Peru</P>
</TD><TD valign=top width=70><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>88.2%</P>
</TD><TD valign=top width=87.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=justify>Consolidated</P>
</TD><TD valign=top width=165.2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=justify>Morococha Mine</P>
</TD></TR>
<TR><TD valign=top width=196.267><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=justify>Plata Panamericana S.A. de C.V.</P>
</TD><TD valign=top width=72.8><P style="line-height:11pt; margin:0pt; padding-left:9.4pt; font-family:Arial; font-size:9pt">Mexico</P>
</TD><TD valign=top width=70><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>100%</P>
</TD><TD valign=top width=87.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=justify>Consolidated</P>
</TD><TD valign=top width=165.2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=justify>La Colorada Mine</P>
</TD></TR>
<TR><TD valign=top width=196.267><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=justify>Minera Corner Bay S.A.</P>
</TD><TD valign=top width=72.8><P style="line-height:11pt; margin:0pt; padding-left:9.4pt; font-family:Arial; font-size:9pt">Mexico</P>
</TD><TD valign=top width=70><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>100%</P>
</TD><TD valign=top width=87.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=justify>Consolidated</P>
</TD><TD valign=top width=165.2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=justify>Alamo Dorado Project</P>
</TD></TR>
<TR><TD valign=top width=196.267><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=justify>Compa&#241;&#237;a Minera PAS Bolivia S.A.</P>
</TD><TD valign=top width=72.8><P style="line-height:11pt; margin:0pt; padding-left:9.4pt; font-family:Arial; font-size:9pt">Bolivia</P>
</TD><TD valign=top width=70><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>55%</P>
</TD><TD valign=top width=87.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=justify>Consolidated</P>
</TD><TD valign=top width=165.2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=justify>San Vicente Project</P>
</TD></TR>
<TR><TD valign=top width=196.267><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=justify>Compa&#241;&#237;a Minera Triton S.A.</P>
</TD><TD valign=top width=72.8><P style="line-height:11pt; margin:0pt; padding-left:9.4pt; font-family:Arial; font-size:9pt">Argentina</P>
</TD><TD valign=top width=70><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>100% (1)</P>
</TD><TD valign=top width=87.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=justify>Consolidated</P>
</TD><TD valign=top width=165.2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=justify>Manantial Espejo Project</P>
</TD></TR>
<TR><TD valign=top width=196.267>&nbsp;</TD><TD valign=top width=72.8>&nbsp;</TD><TD valign=top width=70>&nbsp;</TD><TD valign=top width=87.667>&nbsp;</TD><TD valign=top width=165.2>&nbsp;</TD></TR>
</TABLE>
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<P style="line-height:10pt; margin-top:0pt; margin-bottom:4pt; padding-left:36pt; font-family:Arial; font-size:8pt">(1) The Company acquired the remaining 50% interest from the joint venture partner on April 10, 2006.</P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:28.35pt; font-family:Arial" align=justify>Inter-company balances and transactions have been eliminated upon consolidation. Investments where the Company has an ownership of 50% and funds its proportionate share of expenditures are accounted for using the proportionate consolidation method. &nbsp;Investments where the Company has an ownership of less than 50% and funds its proportionate share of expenditures are accounted for under the equity method. The Company has no investments in entities in which its ownership interest is accounted for using the cost method. </P>
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<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">13</P>
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<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt; page-break-before:always"><B>Pan American Silver Corp.</B></P>
<P style="margin:0pt; font-family:Arial">Notes to Unaudited Interim Consolidated Financial Statements</P>
<P style="margin:0pt; font-family:Arial">As at June 30, 2006 and 2005 and for the three month periods then ended</P>
<P style="margin:0pt; font-family:Arial">(Tabular amounts are in thousands of US dollars, except for numbers of shares, price per share and per share amounts)</P>
<P style="margin:0pt; padding-top:3pt; border-top:0.5pt solid #000000"><BR></P>
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<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:56.7pt; text-indent:-28.35pt; font-family:Arial" align=justify><U>c)</U></P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:56.7pt; font-family:Arial" align=justify><U>Measurement Uncertainty:</U> The preparation of financial statements in conformity with accounting principles generally accepted in Canada requires the Company&#146;s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. &nbsp;Significant accounts that require estimates as the basis for determining the stated amounts include sales, inventories, mineral property plant and equipment, investments, unrealized gains and losses on commodity contracts, provisions for asset retirement obligations and reclamation, and provisions for future income taxes.</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:56.7pt; text-indent:-28.35pt; font-family:Arial" align=justify><U>d)</U></P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:56.7pt; font-family:Arial" align=justify><U>Revenue Recognition:</U> Revenue is recognized upon delivery when title and risk of ownership of metals or metal bearing concentrate passes to the buyer and when collection is reasonably assured. The passing of title to the customer is based on the terms of the sales contract. Product pricing is determined at the point revenue is recognized by reference to active and freely traded commodity markets.</P>
<P style="font-family: Arial; margin-top: 0pt; margin-bottom: 5pt; padding-left: 56.7pt" align=justify>Under our concentrate sales contracts with third-party smelters, final commodity prices are set on a specified quotational period, typically ranging from one month prior to shipment, and can extend to three months after the shipment arrives at the smelter and is based on average market metal prices. Revenues are recorded under these contracts at the time title passes to the buyer based on the expected settlement period. The contracts, in general, provide for a provisional payment based upon provisional assays and quoted metal prices. Final settlement is based on the average applicable price for a specified future period, and generally occurs from three to six months after shipment. Variations between the price recorded at the shipment date and the actual final price set under the smelting contracts are caused by changes in metal prices, and result in an embedded derivative in the accounts receivable. &nbsp;
The embedded derivative is recorded at fair value each period until the final settlement occurs, with changes in fair value classified as a component of revenue. Final sales are settled using smelter weights and final settlement assays (average of assays exchanged and/or umpire assay results). </P>
<P style="font-family: Arial; margin-top: 0pt; margin-bottom: 5pt; padding-left: 56.7pt" align=justify>Third party smelting and refining costs are recorded as a reduction of revenue. </P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:56.7pt; text-indent:-28.35pt; font-family:Arial" align=justify><U>e)</U></P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:56.7pt; font-family:Arial" align=justify><U>Derivatives and Trading Activities:</U> The Company employs metals and currency contracts, including forward contracts, to manage exposure to fluctuations in metal prices and foreign currency exchange rates. &nbsp;For metals production, these contracts are intended to reduce the risk of falling prices on the Company&#146;s future sales. &nbsp;Foreign currency derivative financial instruments, such as forward contracts, are used to manage the effects of exchange rate changes on foreign currency cost exposures. &nbsp;The Company recognizes mark-to-market valuations on open derivative positions through the consolidated statements of operations at the end of each period.</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:56.7pt; text-indent:-28.35pt; font-family:Arial" align=justify><U>f)</U></P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:56.7pt; font-family:Arial" align=justify><U>Cash and Cash Equivalents:</U> Cash and cash equivalents includes cash, bank deposits, and all highly-liquid investments with a maturity of three months or less at the date of purchase. The Company minimizes its credit risk by investing its cash and cash equivalents with major international banks and financial institutions located principally in Canada and Peru with a minimum credit rating of A1 as defined by Standard &amp; Poor&#146;s. The Company&#146;s management believes that no concentration of credit risk exists with respect to investment of its cash and cash equivalents. Due to the short maturity of cash equivalents, their carrying amounts approximate their fair value.</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:56.7pt; text-indent:-28.35pt; font-family:Arial" align=justify><U>g)</U></P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:56.7pt; font-family:Arial" align=justify><U>Short-term Investments:</U> Short-term investments principally consist of highly-liquid debt securities with original maturities in excess of three months and less than one year. &nbsp;These debt securities include corporate bonds with S &amp; P rating of A- to AAA with an overall average of single A high. The Company classifies all short-term investments as available-for-sale securities.</P>
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<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">14</P>
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<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt; page-break-before:always"><B>Pan American Silver Corp.</B></P>
<P style="margin:0pt; font-family:Arial">Notes to Unaudited Interim Consolidated Financial Statements</P>
<P style="margin:0pt; font-family:Arial">As at June 30, 2006 and 2005 and for the three month periods then ended</P>
<P style="margin:0pt; font-family:Arial">(Tabular amounts are in thousands of US dollars, except for numbers of shares, price per share and per share amounts)</P>
<P style="margin:0pt; padding-top:3pt; border-top:0.5pt solid #000000"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:56.7pt; text-indent:-28.35pt; font-family:Arial" align=justify><U>h)</U></P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:56.7pt; font-family:Arial" align=justify><U>Inventories:</U> Inventories include metal contained in concentrate, dor&#233;, metal contained in stockpiles, processed silver and operating materials and supplies. The classification of inventory is determined by the stage at which the ore is in the production process. Inventories of ore are sampled for metal content and are valued based on the lower of actual production costs incurred or estimated net realizable value based upon the period ending prices of contained metal. Material that does not contain a minimum quantity of metal to cover estimated processing expense to recover the contained metal is not classified as inventory and is assigned no value. All metal inventories are stated at the lower of cost or market, with cost being determined using the first-in, first-out method. Supplies inventories are valued at the lower of average cost and replacement cost, net of obsolescence. Concentrate and dor&#
233; inventory includes product at the mine site, the port warehouse and product held by refineries, and are also valued at lower of cost or market. &nbsp;The Company has a limited amount of finished silver at a minting operation where coins depicting Pan American Silver Corp&#146;s emblem are stamped.</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:56.7pt; text-indent:-28.35pt; font-family:Arial" align=justify><U>i)</U></P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:56.7pt; font-family:Arial" align=justify><U>Accounts Receivable:</U> &nbsp;The Company has 10 customers that account for 100% of the concentrate and dor&#233; sales revenue. &nbsp;The loss of certain of these customers or curtailment of purchases by such customers could have a material adverse affect on the Company&#146;s results of operations and financial condition.</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:56.7pt; text-indent:-28.35pt; font-family:Arial" align=justify><U>j)</U></P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:56.7pt; font-family:Arial" align=justify><U>Property, Plant, and Equipment:</U> Expenditures for new facilities, new assets or expenditures that extend the useful lives of existing facilities are capitalized. Maintenance, repairs and renewals are charged to operations. &nbsp;Any gains or losses on disposition of property, plant and equipment are reflected in the statement of operations. &nbsp;Mineral property costs are depreciated using the units-of-production method based upon estimated total proven and probable reserves. Depreciation of plant and equipment is calculated on a straight-line method at rates sufficient to depreciate such costs over the shorter of the estimated productive lives of such assets or the useful life of the individual assets ranging from three to twenty years and the life of the mineral property to which it relates. &nbsp;</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:56.7pt; text-indent:-28.35pt; font-family:Arial" align=justify><U>k)</U></P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:56.7pt; font-family:Arial" align=justify><U>Operational Mining Properties and Mine Development:</U> Mineral exploration costs are expensed as incurred. When it has been determined that a mineral property can be economically developed as a result of establishing proven and probable reserves (which occurs upon completion of a positive economic analysis of the mineral deposit), the costs incurred to develop such property including costs to further delineate the ore body and remove overburden to initially expose the ore body prior to the start of mining operations, are capitalized. Such costs are amortized using the units-of-production method over the estimated life of the ore body based on the proven and probable reserves. </P>
<P style="font-family: Arial; margin-top: 0pt; margin-bottom: 5pt; padding-left: 56.7pt" align=justify>Significant payments related to the acquisition of the land and mineral rights are capitalized as incurred. Prior to acquiring such land or mineral rights the Company makes a preliminary evaluation to determine that the property has significant potential to develop an economic ore body. The time between initial acquisition and full evaluation of a property&#146;s potential is variable and is dependent on many factors including: location relative to existing infrastructure, the property&#146;s stage of development, geological controls and metal prices. If a mineable ore body is discovered, such costs are amortized when production begins. If no mineable ore body is discovered, such costs are expensed in the period in which it is determined the property has no future economic value. </P>
<P style="font-family: Arial; margin-top: 0pt; margin-bottom: 5pt; padding-left: 56.7pt" align=justify>Interest expense allocable to the cost of developing mining properties and to construct new facilities is capitalized until the assets are ready for their intended use. Gains or losses from sales or retirements of assets are included in other income or expense. Costs incurred during the start-up phase of a mine are expensed as incurred. Ongoing mining expenditures on producing properties are charged against operations as incurred. Major development expenditures incurred to increase production or extend the life of the mine are capitalized.</P>
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<BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">15</P>
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<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt; page-break-before:always"><B>Pan American Silver Corp.</B></P>
<P style="margin:0pt; font-family:Arial">Notes to Unaudited Interim Consolidated Financial Statements</P>
<P style="margin:0pt; font-family:Arial">As at June 30, 2006 and 2005 and for the three month periods then ended</P>
<P style="margin:0pt; font-family:Arial">(Tabular amounts are in thousands of US dollars, except for numbers of shares, price per share and per share amounts)</P>
<P style="margin:0pt; padding-top:3pt; border-top:0.5pt solid #000000"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:56.7pt; text-indent:-28.35pt; font-family:Arial" align=justify><U>l)</U></P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:56.7pt; font-family:Arial" align=justify><U>Asset Impairment:</U> Management reviews and evaluates its long-lived assets for impairment whenever events or changes in circumstances indicate that the related carrying amounts may not be recoverable. Impairment is considered to exist if total estimated future cash flows or probability-weighted cash flows on an undiscounted basis are less than the carrying amount of the assets, including mineral property, plant and equipment, non-producing property, and any deferred costs such as deferred stripping. An impairment loss is measured and recorded based on discounted estimated future cash flows or the application of an expected present value technique to estimate fair value in the absence of a market price. Future cash flows are determined using recoverable proven and probable reserves and a portion of recoverable resource ounces, gold and silver prices (considering current and historical prices, price trends a
nd related factors), production levels, capital and reclamation costs, all based on detailed engineering life-of-mine plans. Assumptions underlying future cash flow estimates are subject to risks and uncertainties. Any differences between significant assumptions and market conditions and/or the Company&#146;s performance could have a material effect on any impairment provision, and on the Company&#146;s financial position and results of operations. In estimating future cash flows, assets are grouped at the lowest levels for which there are identifiable cash flows that are largely independent of cash flows from other groups. Generally, in estimating future cash flows, all assets are grouped at a particular mine for which there is identifiable cash flow. </P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:56.7pt; text-indent:-28.35pt; font-family:Arial" align=justify><U>m)</U></P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:56.7pt; font-family:Arial" align=justify><U>Reclamation and Remediation Costs:</U> Estimated future reclamation and remediation costs are based principally on legal and regulatory requirements. </P>
<P style="font-family: Arial; margin-top: 0pt; margin-bottom: 5pt; padding-left: 56.7pt" align=justify>The asset retirement obligation is measured using assumptions for cash outflows such as expected labor costs, allocated overhead and equipment charges, contractor markup, and inflation adjustments to determine the total obligation.&nbsp; The sum of all these costs is discounted, using the credit adjusted risk-free interest rate from the time the Company expects to pay the retirement obligation to the time the Company incurs the obligation. The measurement objective is to determine the amount a third party would demand to assume the asset retirement obligation. </P>
<P style="font-family: Arial; margin-top: 0pt; margin-bottom: 5pt; padding-left: 56.7pt" align=justify>Upon initial recognition of a liability for an asset retirement obligation, the Company capitalizes the asset retirement cost to the related long-lived asset. The Company amortizes this amount to operating expense using the units-of-production method. The Company evaluates the cash flow estimates annually to determine whether the estimates continue to be appropriate. &nbsp;Upward revisions in the amount of undiscounted cash flows will be discounted using the current credit-adjusted risk-free rate. Downward revisions will be discounted using the credit-adjusted risk-free rate that existed when the original liability was recorded. &nbsp;</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:56.7pt; text-indent:-28.35pt; font-family:Arial" align=justify><U>n)</U></P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:56.7pt; font-family:Arial" align=justify><U>Foreign Currency Translation:</U> &nbsp;The Company&#146;s functional currency is the US dollar. Transaction amounts denominated in foreign currencies (currencies other than U.S. dollars) are translated into U.S. dollars at exchange rates prevailing at the transaction dates. &nbsp;Carrying values of non-U.S. dollar monetary assets and liabilities are adjusted at each balance sheet date to reflect the U.S. exchange rate prevailing at that date. &nbsp;Gains and losses arising from revaluation of foreign currency monetary assets and liabilities at each period end are included in operations. &nbsp;</P>
<P style="font-family: Arial; margin-top: 0pt; margin-bottom: 5pt; padding-left: 56.7pt" align=justify>The accounts of subsidiaries, not reporting in U.S. dollars and which are integrated operations, are translated into U.S. dollars using the temporal method. &nbsp;Under this method, substantially all assets and liabilities of those foreign subsidiaries are translated at exchange rates in effect at the date of the transaction or at the end of each period. Revenues and expenses are translated at the average exchange rate for the period, as appropriate. Foreign currency transaction gains and losses are included in the determination of net income or loss. </P>
<P style="margin-top:0pt; margin-bottom:5pt" align=justify><BR>
<BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">16</P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt; page-break-before:always"><B>Pan American Silver Corp.</B></P>
<P style="margin:0pt; font-family:Arial">Notes to Unaudited Interim Consolidated Financial Statements</P>
<P style="margin:0pt; font-family:Arial">As at June 30, 2006 and 2005 and for the three month periods then ended</P>
<P style="margin:0pt; font-family:Arial">(Tabular amounts are in thousands of US dollars, except for numbers of shares, price per share and per share amounts)</P>
<P style="margin:0pt; padding-top:3pt; border-top:0.5pt solid #000000"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:56.7pt; text-indent:-28.35pt; font-family:Arial" align=justify><U>o)</U></P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:56.7pt; font-family:Arial" align=justify><U>Stock-based Compensation:</U> &nbsp;The Company provides stock grants or options to buy common shares of the Company to directors, officers, employees and service providers. &nbsp;The board of directors grants such options for periods of up to ten years, with vesting periods of up to four years &nbsp;and at prices equal to or greater than the weighted average market price of the five trading days prior to the date the options were granted.</P>
<P style="font-family: Arial; margin-top: 0pt; margin-bottom: 5pt; padding-left: 56.7pt" align=justify>The Company applies the fair-value method of accounting in accordance with the recommendations of CICA Handbook Section (&#147;CICA 3870&#148;), &#147;Stock-based Compensation and Other Stock-based Payments&#148;. &nbsp;Stock-based compensation expense is calculated using the Black-Scholes option pricing model for stock grants and market price for stock issued. </P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:56.7pt; text-indent:-28.35pt; font-family:Arial" align=justify><U>p)</U></P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:56.7pt; font-family:Arial" align=justify><U>Income Taxes:</U> The Company computes income taxes in accordance with CICA Handbook Section (&#147;CICA 3465&#148;), &#147;Income Taxes&#148;, which requires an asset and liability approach. This results in the recognition of future tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax basis of assets and liabilities, as well as operating loss and tax credit carry-forwards, using enacted or substantially enacted, as applicable, tax rates in effect in the years in which the differences are expected to reverse. The Company records a valuation allowance against a portion of those future income tax assets that management believes will, more likely than not, fail to be realized. &nbsp;On business acquisitions, where differences between assigned values and tax bases of assets acquired (other than non-tax deductible goodwill) and liabi
lities assumed exist, the Company recognizes the future tax assets and liabilities for the tax effects of such differences. </P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:56.7pt; text-indent:-28.35pt; font-family:Arial" align=justify><U>q)</U></P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:56.7pt; font-family:Arial" align=justify><U>Income per share:</U> Basic income per share calculations are based on the net income (loss) attributable to common shareholders for the period divided by the weighted average number of common shares issued and outstanding during the period.</P>
<P style="font-family: Arial; margin-top: 0pt; margin-bottom: 5pt; padding-left: 56.7pt" align=justify>The diluted income (&#147;EPS&#148;) per share calculations are based on the weighted average number of common shares outstanding during the period, plus the effects of dilutive common share equivalents. This method requires that the dilutive effect of outstanding options and warrants issued and outstanding be calculated using the treasury stock method. &nbsp;This method assumes that all common share equivalents have been exercised at the beginning of the period (or at the time of issuance, if later), and that the funds obtained thereby were used to purchase common shares of the Company at the average trading price of the common shares during the period.</P>
<P style="font-family: Arial; margin-top: 0pt; margin-bottom: 5pt; padding-left: 56.7pt" align=justify>For convertible securities that may be settled in cash or shares at the holder&#146;s option, the more dilutive of cash settlement and share settlement is used in computing diluted income per share. For settlements in common shares, the if-converted method is used, which requires that returns on senior convertible equity instruments and income charges applicable to convertible financial liabilities be added back to net income and the net income is also adjusted for any non-discretionary changes that would arise from the beginning of the period (or at the time of issuance, if later).</P>
<P style="font-family: Arial; margin-top: 0pt; margin-bottom: 5pt; padding-left: 56.7pt" align=justify>Potentially dilutive securities totaling 31,438 for the quarter and six months ended June 30, 2006 (nil, 31,438 and nil shares arising from convertible debentures, outstanding and exercisable stock options and share purchase warrants, respectively) and 127,608 shares for the quarter and six months ended June 30, 2005 (nil, 127,608 and nil shares arising from convertible debentures, outstanding and exercisable stock options and share purchase warrants, respectively) were not included as their effect would be anti-dilutive.</P>
<P style="margin-top:0pt; margin-bottom:5pt" align=justify><BR>
<BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">17</P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt; page-break-before:always"><B>Pan American Silver Corp.</B></P>
<P style="margin:0pt; font-family:Arial">Notes to Unaudited Interim Consolidated Financial Statements</P>
<P style="margin:0pt; font-family:Arial">As at June 30, 2006 and 2005 and for the three month periods then ended</P>
<P style="margin:0pt; font-family:Arial">(Tabular amounts are in thousands of US dollars, except for numbers of shares, price per share and per share amounts)</P>
<P style="margin:0pt; padding-top:3pt; border-top:0.5pt solid #000000"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="margin-top:0pt; margin-bottom:5pt" align=justify><BR></P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=0.4></TD><TD width=123.05></TD><TD width=8.25></TD><TD width=47.6></TD><TD width=57.4></TD><TD width=9.8></TD><TD width=35.7></TD><TD width=0.85></TD><TD width=10.3></TD><TD width=40.6></TD><TD width=58.95></TD><TD width=6.85></TD><TD width=38.15></TD><TD width=1.1></TD></TR>
<TR><TD valign=top width=0.533>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" width=164.067><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">For the Three months ended June 30</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=212.8 colspan=6><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>2006</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=207.933 colspan=6><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>2005</P>
</TD></TR>
<TR><TD valign=top width=164.6 colspan=2>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=74.467 colspan=2><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Income (Numerator)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=76.533><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Shares (Denominator)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=60.667 colspan=2><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Per-Share Amount</P>
</TD><TD valign=top width=69 colspan=3><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Income (Numerator)</P>
</TD><TD valign=top width=78.6><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Shares (Denominator)</P>
</TD><TD valign=top width=61.467 colspan=3><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Per-Share Amount</P>
</TD></TR>
<TR><TD valign=top width=164.6 colspan=2><P style="line-height:10pt; margin-top:4pt; margin-bottom:0pt; font-family:Arial; font-size:8pt">Net Income Available to Common Shareholders</P>
</TD><TD valign=bottom width=11><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=right>$</P>
</TD><TD valign=bottom width=63.467><P style="line-height:10pt; margin:0pt; padding-right:3.85pt; text-indent:16.55pt; font-family:Arial; font-size:8pt">14,964</P>
</TD><TD valign=bottom width=76.533><P style="margin:0pt"><BR></P>
</TD><TD valign=bottom width=13.067><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=right>$</P>
</TD><TD valign=bottom width=47.6><P style="margin:0pt"><BR></P>
</TD><TD style="border-top:0.5pt solid #000000" valign=bottom width=14.867 colspan=2><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=right>$</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=bottom width=54.133><P style="line-height:10pt; margin:0pt; text-indent:10.65pt; font-family:Arial; font-size:8pt">4,971</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=bottom width=78.6><P style="margin:0pt"><BR></P>
</TD><TD style="border-top:0.5pt solid #000000" valign=bottom width=9.133><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=right>$</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=bottom width=52.333 colspan=2><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=top width=164.6 colspan=2><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=11>&nbsp;</TD><TD valign=top width=63.467><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=76.533><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=13.067>&nbsp;</TD><TD valign=top width=47.6><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=14.867 colspan=2>&nbsp;</TD><TD valign=top width=54.133><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=78.6><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=9.133>&nbsp;</TD><TD valign=top width=52.333 colspan=2><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=top width=164.6 colspan=2><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt">Basic EPS</P>
</TD><TD valign=top width=11>&nbsp;</TD><TD valign=top width=63.467><P style="line-height:10pt; margin:0pt; padding-right:3.85pt; text-indent:16.55pt; font-family:Arial; font-size:8pt">14,964</P>
</TD><TD valign=top width=76.533><P style="line-height:10pt; margin:0pt; text-indent:7.6pt; font-family:Arial; font-size:8pt">71,173,764</P>
</TD><TD valign=top width=13.067>&nbsp;</TD><TD valign=top width=47.6><P style="line-height:10pt; margin:0pt; text-indent:14.2pt; font-family:Arial; font-size:8pt">0.21</P>
</TD><TD valign=top width=14.867 colspan=2>&nbsp;</TD><TD valign=top width=54.133><P style="line-height:10pt; margin:0pt; text-indent:10.65pt; font-family:Arial; font-size:8pt">4,971</P>
</TD><TD valign=top width=78.6><P style="line-height:10pt; margin:0pt; text-indent:9pt; font-family:Arial; font-size:8pt">66,926,686</P>
</TD><TD valign=top width=9.133>&nbsp;</TD><TD valign=top width=52.333 colspan=2><P style="line-height:10pt; margin:0pt; padding-right:3.85pt; text-indent:9.7pt; font-family:Arial; font-size:8pt">0.07</P>
</TD></TR>
<TR><TD valign=top width=164.6 colspan=2><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt">Effect of Dilutive Securities:</P>
</TD><TD valign=top width=11>&nbsp;</TD><TD valign=top width=63.467><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=76.533><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=13.067>&nbsp;</TD><TD valign=top width=47.6><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=14.867 colspan=2>&nbsp;</TD><TD valign=top width=54.133><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=78.6><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=9.133>&nbsp;</TD><TD valign=top width=52.333 colspan=2><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=top width=164.6 colspan=2><P style="line-height:10pt; margin:0pt; text-indent:15.8pt; font-family:Arial; font-size:8pt">Convertible Debentures</P>
</TD><TD valign=top width=11>&nbsp;</TD><TD valign=top width=63.467><P style="line-height:10pt; margin:0pt; padding-right:3.85pt; text-indent:34.55pt; font-family:Arial; font-size:8pt">3</P>
</TD><TD valign=top width=76.533><P style="line-height:10pt; margin:0pt; text-indent:21.6pt; font-family:Arial; font-size:8pt">68,130</P>
</TD><TD valign=top width=13.067>&nbsp;</TD><TD valign=top width=47.6><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=14.867 colspan=2>&nbsp;</TD><TD valign=top width=54.133><P style="line-height:10pt; margin:0pt; text-indent:24.65pt; font-family:Arial; font-size:8pt">4</P>
</TD><TD valign=top width=78.6><P style="line-height:10pt; margin:0pt; text-indent:23pt; font-family:Arial; font-size:8pt">75,712</P>
</TD><TD valign=top width=9.133>&nbsp;</TD><TD valign=top width=52.333 colspan=2><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=top width=164.6 colspan=2><P style="line-height:10pt; margin:0pt; text-indent:15.8pt; font-family:Arial; font-size:8pt">Stock Options</P>
</TD><TD valign=top width=11>&nbsp;</TD><TD valign=top width=63.467><P style="line-height:10pt; margin:0pt; padding-right:3.85pt; text-indent:35.9pt; font-family:Arial; font-size:8pt">-</P>
</TD><TD valign=top width=76.533><P style="line-height:10pt; margin:0pt; text-indent:17.6pt; font-family:Arial; font-size:8pt">562,333</P>
</TD><TD valign=top width=13.067>&nbsp;</TD><TD valign=top width=47.6><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=14.867 colspan=2>&nbsp;</TD><TD valign=top width=54.133><P style="line-height:10pt; margin:0pt; text-indent:26pt; font-family:Arial; font-size:8pt">-</P>
</TD><TD valign=top width=78.6><P style="line-height:10pt; margin:0pt; text-indent:19pt; font-family:Arial; font-size:8pt">742,308</P>
</TD><TD valign=top width=9.133>&nbsp;</TD><TD valign=top width=52.333 colspan=2><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=top width=164.6 colspan=2><P style="line-height:10pt; margin:0pt; text-indent:15.8pt; font-family:Arial; font-size:8pt">Warrants</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=11>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=63.467><P style="line-height:10pt; margin:0pt; padding-right:3.85pt; text-indent:35.9pt; font-family:Arial; font-size:8pt">-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=76.533><P style="line-height:10pt; margin:0pt; text-indent:11.6pt; font-family:Arial; font-size:8pt">4,064,278</P>
</TD><TD valign=top width=13.067>&nbsp;</TD><TD valign=top width=47.6><P style="margin:0pt"><BR></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=14.867 colspan=2>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=54.133><P style="line-height:10pt; margin:0pt; text-indent:26pt; font-family:Arial; font-size:8pt">-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=78.6><P style="line-height:10pt; margin:0pt; text-indent:13pt; font-family:Arial; font-size:8pt">3,808,636</P>
</TD><TD valign=top width=9.133>&nbsp;</TD><TD valign=top width=52.333 colspan=2><P style="line-height:10pt; margin:0pt; padding-right:3.85pt; text-indent:11.05pt; font-family:Arial; font-size:8pt">-</P>
</TD></TR>
<TR><TD valign=top width=164.6 colspan=2>&nbsp;</TD><TD valign=top width=11>&nbsp;</TD><TD valign=top width=63.467><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=76.533><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=13.067>&nbsp;</TD><TD valign=top width=47.6><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=14.867 colspan=2>&nbsp;</TD><TD valign=top width=54.133><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=78.6><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=9.133>&nbsp;</TD><TD valign=top width=52.333 colspan=2><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=top width=164.6 colspan=2><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt">Diluted EPS</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=11>&nbsp;</TD><TD style="border-bottom:2pt double #000000" valign=top width=63.467><P style="line-height:10pt; margin:0pt; padding-right:3.85pt; text-indent:16.55pt; font-family:Arial; font-size:8pt">14,967</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=76.533><P style="line-height:10pt; margin:0pt; text-indent:7.6pt; font-family:Arial; font-size:8pt">75,868,505</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=13.067>&nbsp;</TD><TD style="border-bottom:2pt double #000000" valign=top width=47.6><P style="line-height:10pt; margin:0pt; text-indent:14.2pt; font-family:Arial; font-size:8pt">0.20</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=14.867 colspan=2>&nbsp;</TD><TD style="border-bottom:2pt double #000000" valign=top width=54.133><P style="line-height:10pt; margin:0pt; text-indent:10.65pt; font-family:Arial; font-size:8pt">4,975</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=78.6><P style="line-height:10pt; margin:0pt; text-indent:9pt; font-family:Arial; font-size:8pt">71,553,342</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=9.133>&nbsp;</TD><TD style="border-bottom:2pt double #000000" valign=top width=52.333 colspan=2><P style="line-height:10pt; margin:0pt; padding-right:3.85pt; text-indent:9.7pt; font-family:Arial; font-size:8pt">0.07</P>
</TD></TR>
<TR><TD valign=top width=164.6 colspan=2>&nbsp;</TD><TD valign=top width=11>&nbsp;</TD><TD valign=top width=63.467><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=76.533><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=13.067>&nbsp;</TD><TD valign=top width=47.6>&nbsp;</TD><TD valign=top width=14.867 colspan=2>&nbsp;</TD><TD valign=top width=54.133><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=78.6><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=9.133>&nbsp;</TD><TD valign=top width=52.333 colspan=2><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=top width=164.6 colspan=2>&nbsp;</TD><TD valign=top width=11>&nbsp;</TD><TD valign=top width=63.467><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=76.533><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=13.067>&nbsp;</TD><TD valign=top width=47.6>&nbsp;</TD><TD valign=top width=14.867 colspan=2>&nbsp;</TD><TD valign=top width=54.133><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=78.6><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=9.133>&nbsp;</TD><TD valign=top width=52.333 colspan=2><P style="margin:0pt"><BR></P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt" align=center><BR></P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=123.6></TD><TD width=8.25></TD><TD width=47.6></TD><TD width=57.4></TD><TD width=9.8></TD><TD width=35.7></TD><TD width=11.15></TD><TD width=40.6></TD><TD width=58.95></TD><TD width=6.85></TD><TD width=38.15></TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" width=164.8><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">For the six months ended June 30</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=211.667 colspan=5><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>2006</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=207.6 colspan=5><P style="line-height:11pt; margin:0pt; padding-right:3.85pt; font-family:Arial; font-size:9pt" align=center>&nbsp;2005</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=164.8>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=11>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=63.467><P style="margin:0pt"><BR></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=76.533><P style="margin:0pt"><BR></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=13.067>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=47.6>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=14.867>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=54.133><P style="margin:0pt"><BR></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=78.6><P style="margin:0pt"><BR></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=9.133>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=50.867><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=top width=164.8>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=74.467 colspan=2><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Income (Numerator)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=76.533><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Shares (Denominator)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=60.667 colspan=2><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Per-Share Amount</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=69 colspan=2><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>&nbsp;Income (Numerator)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=78.6><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Shares (Denominator)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=60 colspan=2><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Per-Share Amount</P>
</TD></TR>
<TR><TD valign=top width=164.8><P style="line-height:10pt; margin-top:4pt; margin-bottom:0pt; font-family:Arial; font-size:8pt">Net Income Available to Common Shareholders</P>
</TD><TD valign=bottom width=11><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=right>$</P>
</TD><TD valign=bottom width=63.467><P style="line-height:10pt; margin:0pt; padding-right:3.85pt; text-indent:16.55pt; font-family:Arial; font-size:8pt">12,203</P>
</TD><TD valign=bottom width=76.533><P style="margin:0pt"><BR></P>
</TD><TD valign=bottom width=13.067><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=right>$</P>
</TD><TD valign=bottom width=47.6><P style="margin:0pt"><BR></P>
</TD><TD valign=bottom width=14.867><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=right>$</P>
</TD><TD valign=bottom width=54.133><P style="line-height:10pt; margin:0pt; text-indent:16.65pt; font-family:Arial; font-size:8pt">748</P>
</TD><TD valign=bottom width=78.6><P style="margin:0pt"><BR></P>
</TD><TD valign=bottom width=9.133><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=right>$</P>
</TD><TD valign=bottom width=50.867><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=top width=164.8><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=11>&nbsp;</TD><TD valign=top width=63.467><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=76.533><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=13.067>&nbsp;</TD><TD valign=top width=47.6><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=14.867>&nbsp;</TD><TD valign=top width=54.133><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=78.6><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=9.133>&nbsp;</TD><TD valign=top width=50.867><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=top width=164.8><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt">Basic EPS</P>
</TD><TD valign=top width=11>&nbsp;</TD><TD valign=top width=63.467><P style="line-height:10pt; margin:0pt; padding-right:3.85pt; text-indent:16.55pt; font-family:Arial; font-size:8pt">12,203</P>
</TD><TD valign=top width=76.533><P style="line-height:10pt; margin:0pt; text-indent:7.6pt; font-family:Arial; font-size:8pt">71,138,233</P>
</TD><TD valign=top width=13.067>&nbsp;</TD><TD valign=top width=47.6><P style="line-height:10pt; margin:0pt; text-indent:14.2pt; font-family:Arial; font-size:8pt">0.17</P>
</TD><TD valign=top width=14.867>&nbsp;</TD><TD valign=top width=54.133><P style="line-height:10pt; margin:0pt; text-indent:16.65pt; font-family:Arial; font-size:8pt">748</P>
</TD><TD valign=top width=78.6><P style="line-height:10pt; margin:0pt; text-indent:9pt; font-family:Arial; font-size:8pt">66,905,637</P>
</TD><TD valign=top width=9.133>&nbsp;</TD><TD valign=top width=50.867><P style="line-height:10pt; margin:0pt; padding-right:3.85pt; text-indent:9.7pt; font-family:Arial; font-size:8pt">0.01</P>
</TD></TR>
<TR><TD valign=top width=164.8><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt">Effect of Dilutive Securities:</P>
</TD><TD valign=top width=11>&nbsp;</TD><TD valign=top width=63.467><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=76.533><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=13.067>&nbsp;</TD><TD valign=top width=47.6><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=14.867>&nbsp;</TD><TD valign=top width=54.133><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=78.6><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=9.133>&nbsp;</TD><TD valign=top width=50.867><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=top width=164.8><P style="line-height:10pt; margin:0pt; text-indent:15.8pt; font-family:Arial; font-size:8pt">Convertible Debentures</P>
</TD><TD valign=top width=11>&nbsp;</TD><TD valign=top width=63.467><P style="line-height:10pt; margin:0pt; padding-right:3.85pt; text-indent:30.55pt; font-family:Arial; font-size:8pt">11</P>
</TD><TD valign=top width=76.533><P style="line-height:10pt; margin:0pt; text-indent:21.6pt; font-family:Arial; font-size:8pt">68,130</P>
</TD><TD valign=top width=13.067>&nbsp;</TD><TD valign=top width=47.6><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=14.867>&nbsp;</TD><TD valign=top width=54.133><P style="line-height:10pt; margin:0pt; text-indent:24.65pt; font-family:Arial; font-size:8pt">4</P>
</TD><TD valign=top width=78.6><P style="line-height:10pt; margin:0pt; text-indent:23pt; font-family:Arial; font-size:8pt">75,712</P>
</TD><TD valign=top width=9.133>&nbsp;</TD><TD valign=top width=50.867><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=top width=164.8><P style="line-height:10pt; margin:0pt; text-indent:15.8pt; font-family:Arial; font-size:8pt">Stock Options</P>
</TD><TD valign=top width=11>&nbsp;</TD><TD valign=top width=63.467><P style="line-height:10pt; margin:0pt; padding-right:3.85pt; text-indent:35.9pt; font-family:Arial; font-size:8pt">-</P>
</TD><TD valign=top width=76.533><P style="line-height:10pt; margin:0pt; text-indent:17.6pt; font-family:Arial; font-size:8pt">562,333</P>
</TD><TD valign=top width=13.067>&nbsp;</TD><TD valign=top width=47.6><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=14.867>&nbsp;</TD><TD valign=top width=54.133><P style="line-height:10pt; margin:0pt; text-indent:26pt; font-family:Arial; font-size:8pt">-</P>
</TD><TD valign=top width=78.6><P style="line-height:10pt; margin:0pt; text-indent:19pt; font-family:Arial; font-size:8pt">742,308</P>
</TD><TD valign=top width=9.133>&nbsp;</TD><TD valign=top width=50.867><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=top width=164.8><P style="line-height:10pt; margin:0pt; text-indent:15.8pt; font-family:Arial; font-size:8pt">Warrants</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=11>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=63.467><P style="line-height:10pt; margin:0pt; padding-right:3.85pt; text-indent:35.9pt; font-family:Arial; font-size:8pt">-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=76.533><P style="line-height:10pt; margin:0pt; text-indent:11.6pt; font-family:Arial; font-size:8pt">4,064,278</P>
</TD><TD valign=top width=13.067>&nbsp;</TD><TD valign=top width=47.6><P style="margin:0pt"><BR></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=14.867>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=54.133><P style="line-height:10pt; margin:0pt; text-indent:26pt; font-family:Arial; font-size:8pt">-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=78.6><P style="line-height:10pt; margin:0pt; text-indent:13pt; font-family:Arial; font-size:8pt">3,808,636</P>
</TD><TD valign=top width=9.133>&nbsp;</TD><TD valign=top width=50.867><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=top width=164.8>&nbsp;</TD><TD valign=top width=11>&nbsp;</TD><TD valign=top width=63.467><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=76.533><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=13.067>&nbsp;</TD><TD valign=top width=47.6><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=14.867>&nbsp;</TD><TD valign=top width=54.133><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=78.6><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=9.133>&nbsp;</TD><TD valign=top width=50.867><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=bottom width=164.8><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt">Diluted EPS</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=11><P style="line-height:10pt; margin-top:4pt; margin-bottom:0pt; font-family:Arial; font-size:8pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=63.467><P style="line-height:10pt; margin-top:4pt; margin-bottom:0pt; text-indent:16.55pt; font-family:Arial; font-size:8pt">12,214</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=76.533><P style="line-height:10pt; margin-top:4pt; margin-bottom:0pt; text-indent:7.6pt; font-family:Arial; font-size:8pt">75,832,974</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=13.067><P style="line-height:10pt; margin-top:4pt; margin-bottom:0pt; font-family:Arial; font-size:8pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=47.6><P style="line-height:10pt; margin-top:4pt; margin-bottom:0pt; text-indent:14.2pt; font-family:Arial; font-size:8pt">0.16</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=14.867><P style="line-height:10pt; margin-top:4pt; margin-bottom:0pt; font-family:Arial; font-size:8pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=54.133><P style="line-height:10pt; margin-top:4pt; margin-bottom:0pt; text-indent:16.65pt; font-family:Arial; font-size:8pt">752</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=78.6><P style="line-height:10pt; margin-top:4pt; margin-bottom:0pt; text-indent:9pt; font-family:Arial; font-size:8pt">71,532,293</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=9.133><P style="line-height:10pt; margin-top:4pt; margin-bottom:0pt; font-family:Arial; font-size:8pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=50.867><P style="line-height:10pt; margin-top:4pt; margin-bottom:0pt; text-indent:9.7pt; font-family:Arial; font-size:8pt">0.01</P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin-top:0pt; margin-bottom:5pt" align=justify><BR></P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:56.7pt; text-indent:-28.35pt; font-family:Arial" align=justify><U>r)</U></P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:56.7pt; font-family:Arial" align=justify><U>Reclassifications:</U> Certain reclassifications of prior year balances have been made to conform to current year presentation.</P>
<P style="margin-top:10pt; margin-bottom:-12pt; font-family:Arial"><B>3.</B></P>
<P style="margin-top:0pt; margin-bottom:10pt; text-indent:18pt; font-family:Arial"><B>Acquisition of Manantial Espejo (Minera Triton S.A.) mining assets</B></P>
<P style="margin-top:0pt; margin-bottom:10pt; font-family:Arial" align=justify>In April, 2006, Pan American completed the acquisition of 50 percent interest in the Manantial Espejo project from Silver Standard Resources Inc.&nbsp; The transaction, gives the Company a 100 percent interest in Manantial Espejo. &nbsp;The purchase price was 1.95 million common shares of Pan American valued at approximately $47.4 million. &nbsp;The measurement of the purchase consideration was based on a Pan American common share price of $24.30, representing the average closing price on the NASDAQ Stock Exchange for the two days prior to and two days after the public announcement of our purchase.</P>
<P style="margin-top:0pt; margin-bottom:10pt; font-family:Arial" align=justify>The acquisition was accounted for by the purchase method of accounting and the accounts of Minera Triton have been consolidated from April 1, 2006, which was the date the Company acquired effective control and ownership of the assets and liabilities of Minera Triton.</P>
<P style="margin-top:0pt; margin-bottom:10pt" align=justify><BR>
<BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">18</P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt; page-break-before:always"><B>Pan American Silver Corp.</B></P>
<P style="margin:0pt; font-family:Arial">Notes to Unaudited Interim Consolidated Financial Statements</P>
<P style="margin:0pt; font-family:Arial">As at June 30, 2006 and 2005 and for the three month periods then ended</P>
<P style="margin:0pt; font-family:Arial">(Tabular amounts are in thousands of US dollars, except for numbers of shares, price per share and per share amounts)</P>
<P style="margin:0pt; padding-top:3pt; border-top:0.5pt solid #000000"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="margin-top:0pt; margin-bottom:10pt; font-family:Arial" align=justify>The preliminary allocation of the fair value of assets and liabilities acquired and the consideration paid are summarized as follows:</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:36pt; font-family:Arial">Current assets, including cash of $45</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:315pt; font-family:Arial">$</P>
<P style="margin:0pt; padding-left:36pt; text-indent:350pt; font-family:Arial">71</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:36pt; font-family:Arial">Plant and equipment</P>
<P style="margin:0pt; padding-left:36pt; text-indent:337.5pt; font-family:Arial">1,711</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:36pt; font-family:Arial">Mineral properties</P>
<P style="margin:0pt; padding-left:36pt; text-indent:332.5pt; font-family:Arial">57,201</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:36pt; font-family:Arial"><U>Other</U></P>
<P style="margin:0pt; padding-left:36pt; text-indent:337.5pt; font-family:Arial"><U>1,176</U></P>
<P style="line-height:18pt; margin:0pt; padding-left:36pt; text-indent:332.5pt; font-family:Arial">60,159</P>
<P style="margin:0pt; padding-left:36pt; text-indent:36pt; font-family:Arial">Less:</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:45pt; font-family:Arial">Accounts payable and accrued liabilities</P>
<P style="margin:0pt; padding-left:36pt; text-indent:343.3pt; font-family:Arial">(99)</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:45pt; font-family:Arial"><U>Future income tax liability</U></P>
<P style="margin:0pt; padding-left:36pt; text-indent:325.8pt; font-family:Arial"><U>(12,511</U>)</P>
<P style="line-height:20pt; margin-top:0pt; margin-bottom:-20pt; padding-left:36pt; text-indent:36pt; font-family:Arial"><U>Total purchase price</U></P>
<P style="line-height:20pt; margin-top:0pt; margin-bottom:-20pt; padding-left:36pt; text-indent:315pt; font-family:Arial"><U>$</U></P>
<P style="line-height:18pt; margin:0pt; padding-left:36pt; text-indent:332.5pt; font-family:Arial"><U>47,549</U></P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt; padding-left:36pt; text-indent:36pt; font-family:Arial">Consideration paid is as follows:</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:54pt; font-family:Arial">Issue of Shares</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:315pt; font-family:Arial">$</P>
<P style="margin:0pt; padding-left:36pt; text-indent:332.5pt; font-family:Arial">47,381</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:36pt; text-indent:54pt; font-family:Arial"><U>Acquisition costs</U></P>
<P style="margin:0pt; padding-left:36pt; text-indent:345pt; font-family:Arial"><U>168</U></P>
<P style="line-height:20pt; margin-top:0pt; margin-bottom:-20pt; padding-left:36pt; text-indent:315pt; font-family:Arial"><U>$</U></P>
<P style="line-height:18pt; margin:0pt; padding-left:36pt; text-indent:332.5pt; font-family:Arial"><U>47,549</U></P>
<P style="margin:0pt"><BR></P>
<P style="margin-top:0pt; margin-bottom:10pt; text-indent:36pt; font-family:Arial" align=justify>The purchase cost was allocated to the underlying assets acquired and liabilities assumed based upon their estimated fair values at the date of acquisition. The Company estimated fair values based on discounted cash flows and estimates made by management. The purchase consideration for the mining assets of Manantial Espejo exceeded the carrying value of the underlying assets for tax purposes by $32.9 million. In addition, the Company considered the prior ownership basis in calculating the tax impact of the acquisition. &nbsp;These amounts have been applied to increase the carrying value of the mineral properties for accounting purposes. &nbsp;However, this did not increase the carrying value of the underlying assets for tax purposes and resulted in a temporary difference between accounting and tax values. The resulting estimated future income tax liability associated with this temporary difference of $12.5 millio
n was also applied to increase the carrying value of the mineral properties.</P>
<P style="margin-top:0pt; margin-bottom:10pt; text-indent:36pt; font-family:Arial" align=justify>For purposes of presenting a summary of assets and liabilities acquired, the balance sheet of Minera Triton S. A. at April 1, 2006 has been used as a proxy for the balance sheet on April 10, 2006. The Company does not expect that the final allocation of the consideration among the assets and liabilities of the Manantial Espejo Project will materially vary from those shown above.</P>
<P style="margin-top:10pt; margin-bottom:-12pt; font-family:Arial"><B>4.</B></P>
<P style="margin-top:0pt; margin-bottom:10pt; text-indent:18pt; font-family:Arial"><B>Inventories</B></P>
<P style="margin-top:0pt; margin-bottom:10pt; font-family:Arial" align=justify>Inventories consist of the following:</P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=217.65></TD><TD width=12.1></TD><TD width=98.65></TD><TD width=14.1></TD><TD width=95.45></TD></TR>
<TR><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=290.2>&nbsp;</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=147.667 colspan=2><P style="margin:0pt; font-family:Arial" align=center>&nbsp;&nbsp;&nbsp;&nbsp;June 30, 2006</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=146.067 colspan=2><P style="margin:0pt; font-family:Arial" align=center>December 31 2005</P>
</TD></TR>
<TR><TD style="border-right:0.5pt solid #000000" valign=top width=290.2><P style="margin:0pt; font-family:Arial">Concentrate inventory</P>
</TD><TD valign=top width=16.133><P style="line-height:11pt; margin:0pt; padding-left:-4.2pt; padding-right:-4.5pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD style="border-right:0.5pt solid #000000" valign=top width=131.533><P style="line-height:11pt; margin:0pt; text-indent:36.8pt; font-family:Arial; font-size:9pt">8,467</P>
</TD><TD valign=top width=18.8><P style="line-height:11pt; margin:0pt; padding-right:-4.2pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD valign=top width=127.267><P style="line-height:11pt; margin:0pt; text-indent:27.25pt; font-family:Arial; font-size:9pt">6,421</P>
</TD></TR>
<TR><TD style="border-right:0.5pt solid #000000" valign=top width=290.2><P style="margin:0pt; font-family:Arial">Direct smelting ore and stockpile ore</P>
</TD><TD valign=top width=16.133>&nbsp;</TD><TD style="border-right:0.5pt solid #000000" valign=top width=131.533><P style="line-height:11pt; margin:0pt; text-indent:36.8pt; font-family:Arial; font-size:9pt">3,768</P>
</TD><TD valign=top width=18.8>&nbsp;</TD><TD valign=top width=127.267><P style="line-height:11pt; margin:0pt; text-indent:27.25pt; font-family:Arial; font-size:9pt">3,184</P>
</TD></TR>
<TR><TD style="border-right:0.5pt solid #000000" valign=top width=290.2><P style="margin:0pt; font-family:Arial">Dor&#233; and finished inventory</P>
</TD><TD valign=top width=16.133>&nbsp;</TD><TD style="border-right:0.5pt solid #000000" valign=top width=131.533><P style="line-height:11pt; margin:0pt; text-indent:36.8pt; font-family:Arial; font-size:9pt">3,213</P>
</TD><TD valign=top width=18.8>&nbsp;</TD><TD valign=top width=127.267><P style="line-height:11pt; margin:0pt; text-indent:27.25pt; font-family:Arial; font-size:9pt">3,101</P>
</TD></TR>
<TR><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=290.2><P style="margin:0pt; font-family:Arial">Materials and supplies</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=16.133>&nbsp;</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=131.533><P style="line-height:11pt; margin:0pt; text-indent:36.8pt; font-family:Arial; font-size:9pt">7,099</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=18.8>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=127.267><P style="line-height:11pt; margin:0pt; text-indent:27.25pt; font-family:Arial; font-size:9pt">6,197</P>
</TD></TR>
<TR><TD style="border-right:0.5pt solid #000000" valign=top width=290.2>&nbsp;</TD><TD valign=top width=16.133>&nbsp;</TD><TD style="border-right:0.5pt solid #000000" valign=top width=131.533><P style="line-height:11pt; margin:0pt; text-indent:32.3pt; font-family:Arial; font-size:9pt">22,547</P>
</TD><TD valign=top width=18.8>&nbsp;</TD><TD valign=top width=127.267><P style="line-height:11pt; margin:0pt; text-indent:22.75pt; font-family:Arial; font-size:9pt">18,903</P>
</TD></TR>
<TR><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=290.2><P style="margin:0pt; font-family:Arial">Less: non-current direct smelting ore</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=16.133>&nbsp;</TD><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=top width=131.533><P style="line-height:11pt; margin:0pt; text-indent:30.8pt; font-family:Arial; font-size:9pt">(2,030)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=18.8>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=127.267><P style="line-height:11pt; margin:0pt; text-indent:21.25pt; font-family:Arial; font-size:9pt">(2,236)</P>
</TD></TR>
<TR><TD style="border-right:0.5pt solid #000000; border-bottom:2pt double #000000" valign=top width=290.2>&nbsp;</TD><TD style="border-bottom:2pt double #000000" valign=top width=16.133><P style="line-height:11pt; margin-top:4.5pt; margin-bottom:0pt; padding-left:-4.2pt; padding-right:-4.5pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:2pt double #000000" valign=top width=131.533><P style="line-height:11pt; margin-top:4.5pt; margin-bottom:0pt; text-indent:32.3pt; font-family:Arial; font-size:9pt">20,517</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=18.8><P style="line-height:11pt; margin-top:4.5pt; margin-bottom:0pt; padding-right:-4.2pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=127.267><P style="line-height:11pt; margin-top:4.5pt; margin-bottom:0pt; text-indent:22.75pt; font-family:Arial; font-size:9pt">16,667</P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:0pt" align=justify><BR></P>
<P style="margin:0pt" align=justify><BR>
<BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">19</P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt; page-break-before:always"><B>Pan American Silver Corp.</B></P>
<P style="margin:0pt; font-family:Arial">Notes to Unaudited Interim Consolidated Financial Statements</P>
<P style="margin:0pt; font-family:Arial">As at June 30, 2006 and 2005 and for the three month periods then ended</P>
<P style="margin:0pt; font-family:Arial">(Tabular amounts are in thousands of US dollars, except for numbers of shares, price per share and per share amounts)</P>
<P style="margin:0pt; padding-top:3pt; border-top:0.5pt solid #000000"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="font-family: Arial; margin-top: 10pt; margin-bottom: -12pt"><B>5.</B></P>
<P style="margin-top:0pt; margin-bottom:10pt; padding-left:28.35pt; text-indent:7.65pt; font-family:Arial"><B>Commodity and foreign currency contracts</B></P>
<P style="margin-top:0pt; margin-bottom:10pt; font-family:Arial" align=justify>Derivatives</P>
<P style="margin-top:0pt; margin-bottom:10pt; font-family:Arial" align=justify>At June 30, 2006, the Company had sold forward 6,000 tonnes of zinc at a weighted average price of $1,603 per tonne ($0.727 per pound). During June, 2006, the Company bought 6,000 tonnes of zinc at a weighted average cost of $2,986 per tonne, settling between July and December 2006. &nbsp;These forward purchases were entered into to exactly offset all of the Company&#146;s zinc forward sales positions. &nbsp;The effect of these transactions was to crystallize a loss of $8.3 million at June 30, 2006, which will be settled over the balance of 2006. &nbsp;At June 30, 2006, the cash offered prices for zinc average was $3,218 per tonne which results in a net unrealized mark-to-market loss of the Company&#146;s zinc forward contracts at that date of $8.3 million ($9.5 million of unrealized losses and $1.2 million of unrealized gains).</P>
<P style="margin-top:0pt; margin-bottom:10pt; font-family:Arial" align=justify>The Company has purchased Mexican Pesos (&#147;MXN&#148;) 43.5 million settling between August and September 2006 at an average MXN/USD exchange rate of 10.865. &nbsp;At June 30, 2006, the spot exchange rate for MXN/USD was 11.33 and the unrealized loss recorded on the Company&#146;s position was $0.2 million. </P>
<P style="margin-top:0pt; margin-bottom:10pt; font-family:Arial" align=justify>At June 30, 2006 the Company had fixed the price of 900,000 ounces of its second quarter&#146;s silver production contained in concentrates, which is due to be priced in July and August of 2006 under the Company&#146;s concentrate contracts. &nbsp;The price fixed for these ounces averaged $12.14 per ounce while the spot price of silver was $10.70 per ounce on June 30, 2006, resulting in a mark to market recorded unrealized gain of $1.3 million.</P>
<P style="font-family: Arial; margin-top: 10pt; margin-bottom: -12pt"><B>6.</B></P>
<P style="margin-top:0pt; margin-bottom:10pt; padding-left:28.35pt; text-indent:7.65pt; font-family:Arial"><B>Mineral property, plant and equipment</B></P>
<P style="margin-top:0pt; margin-bottom:10pt; font-family:Arial" align=justify>Mineral property, plant and equipment consist of:</P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=119></TD><TD width=7.7></TD><TD width=43.4></TD><TD width=6.3></TD><TD width=48.3></TD><TD width=6.3></TD><TD width=42></TD><TD width=4.2></TD><TD width=6.15></TD><TD width=41.95></TD><TD width=7.35></TD><TD width=43.25></TD><TD width=6.65></TD><TD width=42.7></TD></TR>
<TR><TD width=158.667>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" width=205.333 colspan=6><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>June 30, 2006</P>
</TD><TD width=5.6>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" width=197.4 colspan=6><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>December 31, 2005</P>
</TD></TR>
<TR><TD width=158.667>&nbsp;</TD><TD width=68.133 colspan=2><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Cost</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=72.8 colspan=2><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Accumulated</P>
<P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Amortization</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=64.4 colspan=2><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Net Book</P>
<P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Value</P>
</TD><TD width=5.6>&nbsp;</TD><TD width=64.133 colspan=2><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Cost</P>
</TD><TD width=67.467 colspan=2><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Accumulated</P>
<P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Amortization</P>
</TD><TD width=65.8 colspan=2><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Net Book</P>
<P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Value</P>
</TD></TR>
<TR><TD valign=top width=158.667>&nbsp;</TD><TD style="border-top:1pt solid #000000" valign=top width=10.267>&nbsp;</TD><TD style="border-top:1pt solid #000000" valign=top width=57.867><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=8.4>&nbsp;</TD><TD valign=top width=64.4>&nbsp;</TD><TD valign=top width=8.4>&nbsp;</TD><TD valign=top width=56><P style="margin:0pt"><BR></P>
</TD><TD style="border-top:1pt solid #000000" valign=top width=5.6>&nbsp;</TD><TD style="border-top:1pt solid #000000" valign=top width=8.2>&nbsp;</TD><TD style="border-top:1pt solid #000000" valign=top width=55.933><P style="margin:0pt"><BR></P>
</TD><TD style="border-top:1pt solid #000000" valign=top width=9.8>&nbsp;</TD><TD style="border-top:1pt solid #000000" valign=top width=57.667>&nbsp;</TD><TD style="border-top:1pt solid #000000" valign=top width=8.867>&nbsp;</TD><TD style="border-top:1pt solid #000000" valign=top width=56.933><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=top width=158.667><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt">&nbsp;&nbsp;Morococha mine, Peru</P>
</TD><TD valign=top width=10.267><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>$</P>
</TD><TD valign=top width=57.867><P style="line-height:11pt; margin:0pt; text-indent:11.25pt; font-family:Arial; font-size:9pt">40,460</P>
</TD><TD valign=top width=8.4><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD valign=top width=64.4><P style="line-height:11pt; margin:0pt; text-indent:11.4pt; font-family:Arial; font-size:9pt">(7,190)</P>
</TD><TD valign=top width=8.4><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD valign=top width=56><P style="line-height:11pt; margin:0pt; text-indent:10.95pt; font-family:Arial; font-size:9pt">33,270</P>
</TD><TD valign=top width=5.6>&nbsp;</TD><TD valign=top width=8.2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD valign=top width=55.933><P style="line-height:11pt; margin:0pt; text-indent:11.25pt; font-family:Arial; font-size:9pt">34,137</P>
</TD><TD valign=top width=9.8><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD valign=top width=57.667><P style="line-height:11pt; margin:0pt; text-indent:11.4pt; font-family:Arial; font-size:9pt">(6,414)</P>
</TD><TD valign=top width=8.867><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD valign=top width=56.933><P style="line-height:11pt; margin:0pt; text-indent:10.95pt; font-family:Arial; font-size:9pt">27,723</P>
</TD></TR>
<TR><TD valign=top width=158.667><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt">&nbsp;&nbsp;La Colorada mine, Mexico </P>
</TD><TD valign=top width=10.267>&nbsp;</TD><TD valign=top width=57.867><P style="line-height:11pt; margin:0pt; text-indent:11.25pt; font-family:Arial; font-size:9pt">26,018</P>
</TD><TD valign=top width=8.4>&nbsp;</TD><TD valign=top width=64.4><P style="line-height:11pt; margin:0pt; text-indent:11.4pt; font-family:Arial; font-size:9pt">(3,137)</P>
</TD><TD valign=top width=8.4>&nbsp;</TD><TD valign=top width=56><P style="line-height:11pt; margin:0pt; text-indent:10.95pt; font-family:Arial; font-size:9pt">22,881</P>
</TD><TD valign=top width=5.6>&nbsp;</TD><TD valign=top width=8.2>&nbsp;</TD><TD valign=top width=55.933><P style="line-height:11pt; margin:0pt; text-indent:11.25pt; font-family:Arial; font-size:9pt">23,529</P>
</TD><TD valign=top width=9.8>&nbsp;</TD><TD valign=top width=57.667><P style="line-height:11pt; margin:0pt; text-indent:34.65pt; font-family:Arial; font-size:9pt">-</P>
</TD><TD valign=top width=8.867>&nbsp;</TD><TD valign=top width=56.933><P style="line-height:11pt; margin:0pt; text-indent:10.95pt; font-family:Arial; font-size:9pt">23,529</P>
</TD></TR>
<TR><TD valign=top width=158.667><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt">&nbsp;&nbsp;Quiruvilca/Huaron mines, Peru</P>
</TD><TD valign=top width=10.267>&nbsp;</TD><TD valign=top width=57.867><P style="line-height:11pt; margin:0pt; text-indent:11.25pt; font-family:Arial; font-size:9pt">75,632</P>
</TD><TD valign=top width=8.4>&nbsp;</TD><TD valign=top width=64.4><P style="line-height:11pt; margin:0pt; text-indent:6.9pt; font-family:Arial; font-size:9pt">(30,138)</P>
</TD><TD valign=top width=8.4>&nbsp;</TD><TD valign=top width=56><P style="line-height:11pt; margin:0pt; text-indent:10.95pt; font-family:Arial; font-size:9pt">45,494</P>
</TD><TD valign=top width=5.6>&nbsp;</TD><TD valign=top width=8.2>&nbsp;</TD><TD valign=top width=55.933><P style="line-height:11pt; margin:0pt; text-indent:11.25pt; font-family:Arial; font-size:9pt">79,860</P>
</TD><TD valign=top width=9.8>&nbsp;</TD><TD valign=top width=57.667><P style="line-height:11pt; margin:0pt; text-indent:6.9pt; font-family:Arial; font-size:9pt">(33,997)</P>
</TD><TD valign=top width=8.867>&nbsp;</TD><TD valign=top width=56.933><P style="line-height:11pt; margin:0pt; text-indent:10.95pt; font-family:Arial; font-size:9pt">45,863</P>
</TD></TR>
<TR><TD valign=top width=158.667><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt">&nbsp;&nbsp;San Vicente mine, Bolivia</P>
</TD><TD valign=top width=10.267>&nbsp;</TD><TD valign=top width=57.867><P style="line-height:11pt; margin:0pt; text-indent:15.75pt; font-family:Arial; font-size:9pt">2,489</P>
</TD><TD valign=top width=8.4>&nbsp;</TD><TD valign=top width=64.4><P style="line-height:11pt; margin:0pt; text-indent:18.15pt; font-family:Arial; font-size:9pt">(108)</P>
</TD><TD valign=top width=8.4>&nbsp;</TD><TD valign=top width=56><P style="line-height:11pt; margin:0pt; text-indent:15.45pt; font-family:Arial; font-size:9pt">2,381</P>
</TD><TD valign=top width=5.6>&nbsp;</TD><TD valign=top width=8.2>&nbsp;</TD><TD valign=top width=55.933><P style="line-height:11pt; margin:0pt; text-indent:22.5pt; font-family:Arial; font-size:9pt">363</P>
</TD><TD valign=top width=9.8>&nbsp;</TD><TD valign=top width=57.667><P style="line-height:11pt; margin:0pt; text-indent:22.65pt; font-family:Arial; font-size:9pt">(56)</P>
</TD><TD valign=top width=8.867>&nbsp;</TD><TD valign=top width=56.933><P style="line-height:11pt; margin:0pt; text-indent:22.2pt; font-family:Arial; font-size:9pt">307</P>
</TD></TR>
<TR><TD valign=top width=158.667><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt">&nbsp;&nbsp;Other</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=10.267>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=top width=57.867><P style="line-height:11pt; margin:0pt; text-indent:15.75pt; font-family:Arial; font-size:9pt">5,769</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=8.4>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=top width=64.4><P style="line-height:11pt; margin:0pt; text-indent:11.4pt; font-family:Arial; font-size:9pt">(1,180)</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=8.4>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=top width=56><P style="line-height:11pt; margin:0pt; text-indent:15.45pt; font-family:Arial; font-size:9pt">4,589</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=5.6>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=top width=8.2>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=top width=55.933><P style="line-height:11pt; margin:0pt; text-indent:15.75pt; font-family:Arial; font-size:9pt">3,213</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=9.8>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=top width=57.667><P style="line-height:11pt; margin:0pt; text-indent:15.9pt; font-family:Arial; font-size:9pt">(820 )</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=8.867>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=top width=56.933><P style="line-height:11pt; margin:0pt; text-indent:15.45pt; font-family:Arial; font-size:9pt">2,393</P>
</TD></TR>
<TR><TD style="border-top:0.5pt solid #000000" valign=top width=158.667>&nbsp;</TD><TD valign=top width=10.267>&nbsp;</TD><TD valign=top width=57.867><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=8.4>&nbsp;</TD><TD valign=top width=64.4><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=8.4>&nbsp;</TD><TD valign=top width=56><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=5.6>&nbsp;</TD><TD valign=top width=8.2>&nbsp;</TD><TD valign=top width=55.933><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=9.8>&nbsp;</TD><TD valign=top width=57.667><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=8.867>&nbsp;</TD><TD valign=top width=56.933><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD style="border-bottom:2pt double #000000" valign=top width=158.667><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt">&nbsp;&nbsp;TOTAL</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=10.267><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=57.867><P style="line-height:11pt; margin:0pt; text-indent:6.75pt; font-family:Arial; font-size:9pt">150,368</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=8.4><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=64.4><P style="line-height:11pt; margin:0pt; text-indent:6.9pt; font-family:Arial; font-size:9pt">(41,753)</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=8.4><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=56><P style="line-height:11pt; margin:0pt; text-indent:6.45pt; font-family:Arial; font-size:9pt">108,615</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=5.6>&nbsp;</TD><TD style="border-bottom:2pt double #000000" valign=top width=8.2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=55.933><P style="line-height:11pt; margin:0pt; text-indent:6.75pt; font-family:Arial; font-size:9pt">141,102</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=9.8><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=57.667><P style="line-height:11pt; margin:0pt; text-indent:6.9pt; font-family:Arial; font-size:9pt">(41,287)</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=8.867><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=56.933><P style="line-height:11pt; margin:0pt; text-indent:10.95pt; font-family:Arial; font-size:9pt">99,815</P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin-top:10pt; margin-bottom:-12pt; padding-left:28.35pt; font-family:Arial"><B>7.</B></P>
<P style="margin-top:0pt; margin-bottom:10pt; padding-left:28.35pt; text-indent:7.65pt; font-family:Arial"><B>Construction in progress and investment in non-producing properties</B></P>
<P style="margin-top:0pt; margin-bottom:10pt; font-family:Arial" align=justify>The carrying values of Construction in progress are as follows:</P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=166.6></TD><TD width=16.4></TD><TD width=104.2></TD><TD width=11.8></TD><TD width=16.4></TD><TD width=117.75></TD></TR>
<TR><TD style="border-right:0.5pt solid #000000" valign=top width=222.133>&nbsp;</TD><TD valign=top width=21.867>&nbsp;</TD><TD valign=top width=138.933><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>June 30, 2006</P>
</TD><TD style="border-right:0.5pt solid #000000" valign=top width=15.733>&nbsp;</TD><TD valign=top width=21.867>&nbsp;</TD><TD valign=top width=157><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>December 31, 2005</P>
</TD></TR>
<TR><TD style="border-right:0.5pt solid #000000" valign=top width=222.133>&nbsp;</TD><TD valign=top width=21.867>&nbsp;</TD><TD valign=top width=138.933><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Net Book Value</P>
</TD><TD style="border-right:0.5pt solid #000000" valign=top width=15.733>&nbsp;</TD><TD valign=top width=21.867>&nbsp;</TD><TD valign=top width=157><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Net Book Value</P>
</TD></TR>
<TR><TD style="border-right:0.5pt solid #000000" valign=bottom width=222.133><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Alamo Dorado, Mexico</P>
</TD><TD valign=bottom width=21.867><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">$</P>
</TD><TD valign=bottom width=138.933><P style="line-height:11pt; margin:0pt; text-indent:46.5pt; font-family:Arial; font-size:9pt">64,428</P>
</TD><TD style="border-right:0.5pt solid #000000" valign=top width=15.733>&nbsp;</TD><TD valign=top width=21.867><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">$</P>
</TD><TD valign=bottom width=157><P style="line-height:11pt; margin:0pt; text-indent:38.65pt; font-family:Arial; font-size:9pt">34,306</P>
</TD></TR>
<TR><TD style="border-right:0.5pt solid #000000; border-bottom:0.5pt solid #000000" valign=bottom width=222.133><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Manantial Espejo, Argentina</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=bottom width=21.867><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">$</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=bottom width=138.933><P style="line-height:11pt; margin:0pt; text-indent:51pt; font-family:Arial; font-size:9pt">9,714</P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:1pt solid #000000" valign=top width=15.733>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=top width=21.867>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=bottom width=157><P style="line-height:11pt; margin:0pt; text-indent:60.4pt; font-family:Arial; font-size:9pt">-</P>
</TD></TR>
<TR><TD style="border-right:0.5pt solid #000000; border-bottom:2pt double #000000" valign=bottom width=222.133><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt"><B>TOTAL</B></P>
</TD><TD style="border-bottom:2pt double #000000" valign=bottom width=21.867><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt"><B>$</B></P>
</TD><TD style="border-bottom:2pt double #000000" valign=bottom width=138.933><P style="line-height:11pt; margin:0pt; text-indent:46.5pt; font-family:Arial; font-size:9pt">74,142</P>
</TD><TD style="border-right:0.5pt solid #000000; border-bottom:2pt double #000000" valign=top width=15.733>&nbsp;</TD><TD style="border-bottom:2pt double #000000" valign=bottom width=21.867><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=bottom width=157><P style="line-height:11pt; margin:0pt; text-indent:38.65pt; font-family:Arial; font-size:9pt">34,306</P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:0pt"><BR></P>
<P style="margin-top:0pt; margin-bottom:10pt; font-family:Arial" align=justify>Acquisition costs of investment in non-producing properties together with costs directly related to mine development expenditures are deferred. &nbsp;Exploration expenditures on investment in non-producing properties are charged to operations in the period they are incurred.</P>
<P style="margin-top:0pt; margin-bottom:10pt" align=justify><BR>
<BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">20</P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt; page-break-before:always"><B>Pan American Silver Corp.</B></P>
<P style="margin:0pt; font-family:Arial">Notes to Unaudited Interim Consolidated Financial Statements</P>
<P style="margin:0pt; font-family:Arial">As at June 30, 2006 and 2005 and for the three month periods then ended</P>
<P style="margin:0pt; font-family:Arial">(Tabular amounts are in thousands of US dollars, except for numbers of shares, price per share and per share amounts)</P>
<P style="margin:0pt; padding-top:3pt; border-top:0.5pt solid #000000"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="margin-top:0pt; margin-bottom:10pt; font-family:Arial" align=justify>The carrying values of these properties are as follows:</P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=190.4></TD><TD width=16.4></TD><TD width=85.85></TD><TD width=18.8></TD><TD width=18.8></TD><TD width=104.2></TD></TR>
<TR><TD valign=top width=253.867>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=21.867>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=top width=114.467><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>June 30, 2006</P>
</TD><TD valign=top width=25.067>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=25.067>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=top width=138.933><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>December 31, 2005</P>
</TD></TR>
<TR><TD valign=bottom width=253.867><P style="line-height:11pt; margin:0pt; padding-left:-5.4pt; font-family:Arial; font-size:9pt">Morococha, Per&#250;</P>
</TD><TD valign=bottom width=21.867><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD valign=bottom width=114.467><P style="line-height:11pt; margin:0pt; text-indent:21.1pt; font-family:Arial; font-size:9pt">28,107</P>
</TD><TD valign=top width=25.067>&nbsp;</TD><TD valign=bottom width=25.067><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD valign=bottom width=138.933><P style="line-height:11pt; margin:0pt; text-indent:42.45pt; font-family:Arial; font-size:9pt">31,052</P>
</TD></TR>
<TR><TD valign=bottom width=253.867><P style="line-height:11pt; margin:0pt; padding-left:-5.4pt; font-family:Arial; font-size:9pt">Alamo Dorado, M&#233;xico</P>
</TD><TD valign=bottom width=21.867>&nbsp;</TD><TD valign=bottom width=114.467><P style="line-height:11pt; margin:0pt; text-indent:21.1pt; font-family:Arial; font-size:9pt">86,237</P>
</TD><TD valign=top width=25.067>&nbsp;</TD><TD valign=top width=25.067>&nbsp;</TD><TD width=138.933><P style="line-height:11pt; margin:0pt; text-indent:42.45pt; font-family:Arial; font-size:9pt">84,543</P>
</TD></TR>
<TR><TD valign=bottom width=253.867><P style="line-height:11pt; margin:0pt; padding-left:-5.4pt; font-family:Arial; font-size:9pt">Manantial Espejo, Argentina</P>
</TD><TD valign=bottom width=21.867>&nbsp;</TD><TD valign=bottom width=114.467><P style="line-height:11pt; margin:0pt; text-indent:21.1pt; font-family:Arial; font-size:9pt">59,082</P>
</TD><TD valign=top width=25.067>&nbsp;</TD><TD valign=top width=25.067>&nbsp;</TD><TD valign=bottom width=138.933><P style="line-height:11pt; margin:0pt; text-indent:46.95pt; font-family:Arial; font-size:9pt">1,979</P>
</TD></TR>
<TR><TD valign=bottom width=253.867><P style="line-height:11pt; margin:0pt; padding-left:-5.4pt; font-family:Arial; font-size:9pt">San Vicente, Bolivia</P>
</TD><TD valign=bottom width=21.867>&nbsp;</TD><TD valign=bottom width=114.467><P style="line-height:11pt; margin:0pt; text-indent:25.6pt; font-family:Arial; font-size:9pt">5,034</P>
</TD><TD valign=top width=25.067>&nbsp;</TD><TD valign=top width=25.067>&nbsp;</TD><TD valign=bottom width=138.933><P style="line-height:11pt; margin:0pt; text-indent:46.95pt; font-family:Arial; font-size:9pt">4,454</P>
</TD></TR>
<TR><TD valign=bottom width=253.867><P style="line-height:11pt; margin:0pt; padding-left:-5.4pt; font-family:Arial; font-size:9pt">Other</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=bottom width=21.867>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=bottom width=114.467><P style="line-height:11pt; margin:0pt; text-indent:25.6pt; font-family:Arial; font-size:9pt">1,410</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=25.067>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=top width=25.067>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=bottom width=138.933><P style="line-height:11pt; margin:0pt; text-indent:46.95pt; font-family:Arial; font-size:9pt">1,231</P>
</TD></TR>
<TR><TD valign=bottom width=253.867>&nbsp;</TD><TD style="border-bottom:2pt double #000000" valign=bottom width=21.867><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=bottom width=114.467><P style="line-height:11pt; margin:0pt; text-indent:16.6pt; font-family:Arial; font-size:9pt">179,870</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=25.067>&nbsp;</TD><TD style="border-bottom:2pt double #000000" valign=bottom width=25.067><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=bottom width=138.933><P style="line-height:11pt; margin:0pt; text-indent:37.95pt; font-family:Arial; font-size:9pt">123,259</P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin-top:10pt; margin-bottom:-12pt; padding-left:28.35pt; font-family:Arial"><B>8.</B></P>
<P style="margin-top:0pt; margin-bottom:10pt; padding-left:28.35pt; text-indent:7.65pt; font-family:Arial"><B>Asset retirement and obligations</B></P>
<P style="margin-top:0pt; margin-bottom:10pt; font-family:Arial" align=justify>Reclamation and remediation costs are based principally on legal and regulatory requirements. Management estimates costs associated with reclamation of mining properties as well as remediation costs for inactive properties. The estimated undiscounted cash flows generated by our assets and the estimated liabilities for reclamation and remediation are determined using the Company&#146;s assumptions about future costs, mineral prices, mineral processing recovery rates, production levels and capital and reclamation costs. Such assumptions are based on the Company&#146;s current mining plan and the best available information for making such estimates. On an ongoing basis, management evaluates its estimates and assumptions; however, actual amounts could differ from those based on such estimates and assumptions. </P>
<P style="margin-top:0pt; margin-bottom:10pt; font-family:Arial" align=justify>The following is a description of the changes to the Company&#146;s asset retirement obligations from January 1 to June 30, 2006: </P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=327.1></TD><TD width=19.6></TD><TD width=72.95></TD></TR>
<TR><TD style="border-top:0.5pt solid #000000" valign=top width=436.133><P style="margin:0pt; font-family:Arial">Balance at December 31, 2005</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=26.133><P style="margin:0pt; font-family:Arial">$</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=97.267><P style="margin:0pt; font-family:Arial" align=right>39,378</P>
</TD></TR>
<TR><TD valign=top width=436.133><P style="margin:0pt; font-family:Arial">Reclamation expenditures</P>
</TD><TD valign=top width=26.133>&nbsp;</TD><TD valign=top width=97.267><P style="margin:0pt; font-family:Arial" align=right>(395)</P>
</TD></TR>
<TR><TD valign=top width=436.133><P style="margin:0pt; font-family:Arial">Accretion</P>
</TD><TD valign=top width=26.133>&nbsp;</TD><TD valign=top width=97.267><P style="margin:0pt; font-family:Arial" align=right>1,228</P>
</TD></TR>
<TR><TD valign=top width=436.133><P style="margin:0pt; font-family:Arial">Alamo Dorado liability increase to June 30, 2006</P>
</TD><TD valign=top width=26.133>&nbsp;</TD><TD valign=top width=97.267><P style="margin:0pt; font-family:Arial" align=right>1,465</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=436.133><P style="margin:0pt; font-family:Arial">Changes in estimates</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=26.133>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=97.267><P style="margin:0pt; font-family:Arial" align=right>-</P>
</TD></TR>
<TR><TD style="border-bottom:2pt double #000000" valign=top width=436.133><P style="margin:0pt; font-family:Arial">Balance at June 30, 2006</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=26.133><P style="margin:0pt; font-family:Arial">$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=97.267><P style="margin:0pt; font-family:Arial" align=right>41,676</P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin-top:10pt; margin-bottom:-12pt; font-family:Arial"><B>9.</B></P>
<P style="margin-top:0pt; margin-bottom:10pt; text-indent:18pt; font-family:Arial"><B>Share capital</B></P>
<P style="margin-top:0pt; margin-bottom:5pt; font-family:Arial" align=justify>The Company completed its base shelf offering on April 18, 2006 and completed an over-allotment option of the Offering on April 21, 2006.&nbsp; The Offering consisted of 6.28 million common shares priced at $23.88 for gross proceeds of $150 million and net proceeds after deducting underwriting fees, of $142.2 million.</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:56.7pt; text-indent:-28.35pt; font-family:Arial" align=justify>a)</P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:56.7pt; font-family:Arial" align=justify>Stock Options and Share Purchase Warrants</P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:28.05pt; font-family:Arial" align=justify>Transactions concerning stock options and share purchase warrants are summarized as follows:</P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=124.4></TD><TD width=50.65></TD><TD width=12.35></TD><TD width=54></TD><TD width=9></TD><TD width=50.1></TD><TD width=12.35></TD><TD width=54.55></TD><TD width=12.1></TD><TD width=50.9></TD></TR>
<TR><TD width=165.867>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" width=156 colspan=3><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Incentive</P>
<P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Stock Option Plan</P>
</TD><TD width=12>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" width=156 colspan=3><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Share Purchase</P>
<P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Warrants</P>
</TD><TD width=84 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Total</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=165.867>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=67.533><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Shares</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=16.467>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Price</P>
</TD><TD valign=top width=12>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=66.8><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Shares</P>
</TD><TD valign=top width=16.467>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72.733><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Price</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=16.133>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=67.867><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Shares</P>
</TD></TR>
<TR><TD valign=top width=165.867><P style="line-height:10pt; margin-top:4pt; margin-bottom:0pt; font-family:Arial; font-size:8pt">As at December 31, 2004</P>
</TD><TD valign=bottom width=67.533><P style="line-height:10pt; margin:0pt; text-indent:11.6pt; font-family:Arial; font-size:8pt">1,683,574</P>
</TD><TD valign=bottom width=16.467><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=right>$</P>
</TD><TD valign=bottom width=72><P style="line-height:10pt; margin:0pt; padding-right:-2.2pt; text-indent:22.4pt; font-family:Arial; font-size:8pt">9.90</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=bottom width=12><P style="margin:0pt"><BR></P>
</TD><TD valign=bottom width=66.8><P style="line-height:10pt; margin:0pt; text-indent:11.6pt; font-family:Arial; font-size:8pt">3,809,817</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=bottom width=16.467><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=right>$</P>
</TD><TD valign=bottom width=72.733><P style="line-height:10pt; margin:0pt; padding-right:-2.2pt; text-indent:22.95pt; font-family:Arial; font-size:8pt">9.98</P>
</TD><TD valign=bottom width=16.133>&nbsp;</TD><TD valign=bottom width=67.867><P style="line-height:10pt; margin:0pt; text-indent:8.5pt; font-family:Arial; font-size:8pt">5,493,391</P>
</TD></TR>
<TR><TD valign=top width=165.867><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=67.533><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=16.467>&nbsp;</TD><TD valign=top width=72><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=12><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=66.8><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=16.467>&nbsp;</TD><TD valign=top width=72.733><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=16.133>&nbsp;</TD><TD valign=top width=67.867><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=top width=165.867><P style="line-height:10pt; margin:0pt; text-indent:15.8pt; font-family:Arial; font-size:8pt">Granted</P>
</TD><TD valign=top width=67.533><P style="line-height:10pt; margin:0pt; text-indent:21.6pt; font-family:Arial; font-size:8pt">87,000</P>
</TD><TD valign=top width=16.467>&nbsp;</TD><TD valign=top width=72><P style="line-height:10pt; margin:0pt; padding-right:-2.2pt; text-indent:18.4pt; font-family:Arial; font-size:8pt">16.12</P>
</TD><TD valign=top width=12><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=66.8><P style="line-height:10pt; margin:0pt; text-indent:17.6pt; font-family:Arial; font-size:8pt">255,781</P>
</TD><TD valign=top width=16.467>&nbsp;</TD><TD valign=top width=72.733><P style="line-height:10pt; margin:0pt; padding-right:-2.2pt; text-indent:18.95pt; font-family:Arial; font-size:8pt">16.91</P>
</TD><TD valign=top width=16.133>&nbsp;</TD><TD valign=top width=67.867><P style="line-height:10pt; margin:0pt; text-indent:14.5pt; font-family:Arial; font-size:8pt">342,781</P>
</TD></TR>
<TR><TD valign=top width=165.867><P style="line-height:10pt; margin:0pt; text-indent:15.8pt; font-family:Arial; font-size:8pt">Exercised</P>
</TD><TD valign=top width=67.533><P style="line-height:10pt; margin:0pt; text-indent:12.3pt; font-family:Arial; font-size:8pt">(693,933)</P>
</TD><TD valign=top width=16.467>&nbsp;</TD><TD valign=top width=72><P style="line-height:10pt; margin:0pt; padding-right:-2.2pt; text-indent:22.4pt; font-family:Arial; font-size:8pt">9.15</P>
</TD><TD valign=top width=12><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=66.8><P style="line-height:10pt; margin:0pt; text-indent:20.3pt; font-family:Arial; font-size:8pt">(1,320)</P>
</TD><TD valign=top width=16.467>&nbsp;</TD><TD valign=top width=72.733><P style="line-height:10pt; margin:0pt; padding-right:-2.2pt; text-indent:22.95pt; font-family:Arial; font-size:8pt">9.98</P>
</TD><TD valign=top width=16.133>&nbsp;</TD><TD valign=top width=67.867><P style="line-height:10pt; margin:0pt; text-indent:9.2pt; font-family:Arial; font-size:8pt">(695,253)</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=165.867><P style="line-height:10pt; margin:0pt; text-indent:15.8pt; font-family:Arial; font-size:8pt">Cancelled</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=67.533><P style="line-height:10pt; margin:0pt; text-indent:16.3pt; font-family:Arial; font-size:8pt">(26,000)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=16.467>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="line-height:10pt; margin:0pt; padding-right:-2.2pt; text-indent:18.4pt; font-family:Arial; font-size:8pt">18.16</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12><P style="margin:0pt"><BR></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=66.8><P style="line-height:10pt; margin:0pt; text-indent:40.95pt; font-family:Arial; font-size:8pt">-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=16.467>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72.733><P style="line-height:10pt; margin:0pt; padding-right:-2.2pt; text-indent:24.3pt; font-family:Arial; font-size:8pt">-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=16.133>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=67.867><P style="line-height:10pt; margin:0pt; text-indent:13.2pt; font-family:Arial; font-size:8pt">(26,000)</P>
</TD></TR>
<TR><TD valign=bottom width=165.867><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt">As at December 31, 2005</P>
</TD><TD valign=top width=67.533><P style="line-height:10pt; margin-top:4pt; margin-bottom:0pt; text-indent:11.6pt; font-family:Arial; font-size:8pt">1,050,641</P>
</TD><TD valign=top width=16.467>&nbsp;</TD><TD valign=top width=72><P style="line-height:10pt; margin-top:4pt; margin-bottom:0pt; padding-right:-2.2pt; text-indent:18.4pt; font-family:Arial; font-size:8pt">10.88</P>
</TD><TD valign=top width=12>&nbsp;</TD><TD valign=top width=66.8><P style="line-height:10pt; margin-top:4pt; margin-bottom:0pt; text-indent:11.6pt; font-family:Arial; font-size:8pt">4,064,278</P>
</TD><TD valign=top width=16.467>&nbsp;</TD><TD valign=top width=72.733><P style="line-height:10pt; margin-top:4pt; margin-bottom:0pt; padding-right:-2.2pt; text-indent:18.95pt; font-family:Arial; font-size:8pt">10.71</P>
</TD><TD valign=top width=16.133>&nbsp;</TD><TD valign=top width=67.867><P style="line-height:10pt; margin-top:4pt; margin-bottom:0pt; text-indent:8.5pt; font-family:Arial; font-size:8pt">5,114,919</P>
</TD></TR>
<TR><TD valign=top width=165.867><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=67.533><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=16.467>&nbsp;</TD><TD valign=top width=72><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=12><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=66.8><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=16.467>&nbsp;</TD><TD valign=top width=72.733><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=16.133>&nbsp;</TD><TD valign=top width=67.867><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=top width=165.867><P style="line-height:10pt; margin:0pt; text-indent:15.8pt; font-family:Arial; font-size:8pt">Granted</P>
</TD><TD valign=top width=67.533><P style="line-height:10pt; margin:0pt; text-indent:17.6pt; font-family:Arial; font-size:8pt">191,332</P>
</TD><TD valign=top width=16.467>&nbsp;</TD><TD valign=top width=72><P style="line-height:10pt; margin:0pt; padding-right:-2.2pt; text-indent:18.4pt; font-family:Arial; font-size:8pt">19.23</P>
</TD><TD valign=top width=12><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=66.8><P style="line-height:10pt; margin:0pt; text-indent:40.95pt; font-family:Arial; font-size:8pt">-</P>
</TD><TD valign=top width=16.467>&nbsp;</TD><TD valign=top width=72.733><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=16.133>&nbsp;</TD><TD valign=top width=67.867><P style="line-height:10pt; margin:0pt; text-indent:14.5pt; font-family:Arial; font-size:8pt">191,332</P>
</TD></TR>
<TR><TD valign=top width=165.867><P style="line-height:10pt; margin:0pt; text-indent:15.8pt; font-family:Arial; font-size:8pt">Exercised</P>
</TD><TD valign=top width=67.533><P style="line-height:10pt; margin:0pt; text-indent:12.3pt; font-family:Arial; font-size:8pt">(159,308)</P>
</TD><TD valign=top width=16.467>&nbsp;</TD><TD valign=top width=72><P style="line-height:10pt; margin:0pt; padding-right:-2.2pt; text-indent:18.4pt; font-family:Arial; font-size:8pt">13.57</P>
</TD><TD valign=top width=12><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=66.8><P style="line-height:10pt; margin:0pt; text-indent:16.3pt; font-family:Arial; font-size:8pt">(11,535)</P>
</TD><TD valign=top width=16.467>&nbsp;</TD><TD valign=top width=72.733><P style="line-height:10pt; margin:0pt; padding-right:-2.2pt; text-indent:16.3pt; font-family:Arial; font-size:8pt">(10.81)</P>
</TD><TD valign=top width=16.133>&nbsp;</TD><TD valign=top width=67.867><P style="line-height:10pt; margin:0pt; text-indent:9.2pt; font-family:Arial; font-size:8pt">(170,843)</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=165.867><P style="line-height:10pt; margin:0pt; text-indent:15.8pt; font-family:Arial; font-size:8pt">Cancelled</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=67.533><P style="line-height:10pt; margin:0pt; text-indent:40.95pt; font-family:Arial; font-size:8pt">-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=16.467>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72><P style="line-height:10pt; margin:0pt; padding-right:-2.2pt; text-indent:23.75pt; font-family:Arial; font-size:8pt">-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12><P style="margin:0pt"><BR></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=66.8><P style="line-height:10pt; margin:0pt; text-indent:40.95pt; font-family:Arial; font-size:8pt">-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=16.467>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=72.733><P style="line-height:10pt; margin:0pt; padding-right:-2.2pt; text-indent:24.3pt; font-family:Arial; font-size:8pt">-</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=16.133>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=67.867><P style="line-height:10pt; margin:0pt; text-indent:37.85pt; font-family:Arial; font-size:8pt">-</P>
</TD></TR>
</TABLE>
  </center>
</div>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0>
<TR><TD style="border-top:0.5pt solid #000000" valign=top width=165.867><P style="margin-top:4pt; margin-bottom:0pt"><BR></P>
</TD><TD style="border-top:0.5pt solid #000000" valign=bottom width=67.533><P style="margin:0pt"><BR></P>
</TD><TD style="border-top:0.5pt solid #000000" valign=bottom width=16.467>&nbsp;</TD><TD style="border-top:0.5pt solid #000000" valign=bottom width=72><P style="margin:0pt"><BR></P>
</TD><TD style="border-top:0.5pt solid #000000" valign=bottom width=12><P style="margin:0pt"><BR></P>
</TD><TD style="border-top:0.5pt solid #000000" valign=bottom width=66.8><P style="margin:0pt"><BR></P>
</TD><TD style="border-top:0.5pt solid #000000" valign=bottom width=16.467>&nbsp;</TD><TD style="border-top:0.5pt solid #000000" valign=bottom width=72.733><P style="margin:0pt"><BR></P>
</TD><TD style="border-top:0.5pt solid #000000" valign=bottom width=16.133>&nbsp;</TD><TD style="border-top:0.5pt solid #000000" valign=bottom width=67.867><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD style="border-bottom:2pt double #000000" valign=bottom width=165.867><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt">As at June 30, 2006</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=67.533><P style="line-height:10pt; margin-top:4pt; margin-bottom:0pt; text-indent:11.6pt; font-family:Arial; font-size:8pt">1,082,665</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=16.467><P style="line-height:10pt; margin-top:4pt; margin-bottom:0pt; font-family:Arial; font-size:8pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=72><P style="line-height:10pt; margin-top:4pt; margin-bottom:0pt; padding-right:-2.2pt; text-indent:18.4pt; font-family:Arial; font-size:8pt">12.73</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=12>&nbsp;</TD><TD style="border-bottom:2pt double #000000" valign=top width=66.8><P style="line-height:10pt; margin-top:4pt; margin-bottom:0pt; text-indent:11.6pt; font-family:Arial; font-size:8pt">4,052,743</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=16.467><P style="line-height:10pt; margin-top:4pt; margin-bottom:0pt; font-family:Arial; font-size:8pt" align=right>$</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=72.733><P style="line-height:10pt; margin-top:4pt; margin-bottom:0pt; padding-right:-2.2pt; text-indent:18.95pt; font-family:Arial; font-size:8pt">10.77</P>
</TD><TD style="border-bottom:2pt double #000000" valign=top width=16.133>&nbsp;</TD><TD style="border-bottom:2pt double #000000" valign=top width=67.867><P style="line-height:10pt; margin-top:4pt; margin-bottom:0pt; text-indent:8.5pt; font-family:Arial; font-size:8pt">5,135,408</P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin-top:0pt; margin-bottom:4.5pt" align=justify><BR>
<BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">21</P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt; page-break-before:always"><B>Pan American Silver Corp.</B></P>
<P style="margin:0pt; font-family:Arial">Notes to Unaudited Interim Consolidated Financial Statements</P>
<P style="margin:0pt; font-family:Arial">As at June 30, 2006 and 2005 and for the three month periods then ended</P>
<P style="margin:0pt; font-family:Arial">(Tabular amounts are in thousands of US dollars, except for numbers of shares, price per share and per share amounts)</P>
<P style="margin:0pt; padding-top:3pt; border-top:0.5pt solid #000000"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="margin-top:0pt; margin-bottom:4pt" align=justify><BR>
<BR>
</P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:28.05pt; font-family:Arial" align=justify>In the period, 11,535 common shares were issued for proceeds of $0.2 million in connection with the exercise of outstanding warrants.</P>
<P style="margin-top:0pt; margin-bottom:-12pt; padding-left:56.7pt; text-indent:-28.35pt; font-family:Arial" align=justify>b)</P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:56.7pt; font-family:Arial" align=justify>Share Option Plan</P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:28.05pt; font-family:Arial" align=justify>The Company has a comprehensive stock option plan for its employees, directors and officers. &nbsp;The plan provides for the issuance of incentive stock options to acquire up to a total of 10% of the issued and outstanding common shares of the Company on a non-diluted basis. &nbsp;The exercise price of each option shall be the weighted average trading price of the Company&#146;s stock on the five days prior to the award date. &nbsp;The options can be granted for a maximum term of 10 years with vesting provisions determined by the Board of Directors. &nbsp;The Company used as its assumptions for calculating the value of the stock options granted a discount rate between 3.81% and 3.88%, volatility between 29.59 and 38.00 percent, expected lives between 1.5 and 3.1 years, and an exercise price of Cdn $22.04 per share.</P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:28.05pt; font-family:Arial" align=justify>The following table summarizes information concerning stock options outstanding as at June 30, 2006:</P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=87.2></TD><TD width=12.2></TD><TD width=47.8></TD><TD width=71></TD><TD width=94></TD><TD width=14></TD><TD width=67></TD><TD width=72></TD></TR>
<TR><TD valign=top width=116.267>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=80 colspan=2>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" width=220 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Options Outstanding</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=204 colspan=3><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Options Exercisable</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" width=116.267><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Range of Exercise Prices</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=80 colspan=2><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Weighted average exercise price</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=94.667><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Number Outstanding as at June 30, 2006</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=125.333><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Weighted Average Remaining Contractual Life (months)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=108 colspan=2><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Weighted average exercise price</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=96><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt" align=center>Number &nbsp;outstanding and exercisable as at June 30, 2006</P>
</TD></TR>
<TR><TD valign=bottom width=116.267><P style="line-height:10pt; margin:0pt; text-indent:9.6pt; font-family:Arial; font-size:8pt">$ &nbsp;4.48</P>
</TD><TD valign=bottom width=16.267><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt">$</P>
</TD><TD valign=bottom width=63.733><P style="line-height:10pt; margin:0pt; text-indent:14.4pt; font-family:Arial; font-size:8pt">4.48</P>
</TD><TD valign=bottom width=94.667><P style="line-height:10pt; margin:0pt; text-indent:25.6pt; font-family:Arial; font-size:8pt">175,000</P>
</TD><TD valign=bottom width=125.333><P style="line-height:10pt; margin:0pt; text-indent:35.6pt; font-family:Arial; font-size:8pt">52.54</P>
</TD><TD valign=bottom width=18.667><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt">$</P>
</TD><TD valign=bottom width=89.333><P style="line-height:10pt; margin:0pt; text-indent:21.6pt; font-family:Arial; font-size:8pt">4.48</P>
</TD><TD valign=bottom width=96><P style="line-height:10pt; margin:0pt; text-indent:22.6pt; font-family:Arial; font-size:8pt">175,000</P>
</TD></TR>
<TR><TD valign=top width=116.267><P style="line-height:10pt; margin:0pt; text-indent:9.6pt; font-family:Arial; font-size:8pt">$ &nbsp;7.98 - $10.76</P>
</TD><TD valign=top width=16.267><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt">$</P>
</TD><TD valign=top width=63.733><P style="line-height:10pt; margin:0pt; text-indent:14.4pt; font-family:Arial; font-size:8pt">8.71</P>
</TD><TD valign=top width=94.667><P style="line-height:10pt; margin:0pt; text-indent:25.6pt; font-family:Arial; font-size:8pt">372,333</P>
</TD><TD valign=top width=125.333><P style="line-height:10pt; margin:0pt; text-indent:35.6pt; font-family:Arial; font-size:8pt">18.94</P>
</TD><TD valign=top width=18.667><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt">$</P>
</TD><TD valign=top width=89.333><P style="line-height:10pt; margin:0pt; text-indent:21.6pt; font-family:Arial; font-size:8pt">8.65</P>
</TD><TD valign=top width=96><P style="line-height:10pt; margin:0pt; text-indent:22.6pt; font-family:Arial; font-size:8pt">272,333</P>
</TD></TR>
<TR><TD valign=top width=116.267><P style="line-height:10pt; margin:0pt; text-indent:9.6pt; font-family:Arial; font-size:8pt">$12.94 - $18.86</P>
</TD><TD valign=top width=16.267><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt">$</P>
</TD><TD valign=top width=63.733><P style="line-height:10pt; margin:0pt; text-indent:10.4pt; font-family:Arial; font-size:8pt">16.64</P>
</TD><TD valign=top width=94.667><P style="line-height:10pt; margin:0pt; text-indent:25.6pt; font-family:Arial; font-size:8pt">306,000</P>
</TD><TD valign=top width=125.333><P style="line-height:10pt; margin:0pt; text-indent:35.6pt; font-family:Arial; font-size:8pt">36.85</P>
</TD><TD valign=top width=18.667><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt">$</P>
</TD><TD valign=top width=89.333><P style="line-height:10pt; margin:0pt; text-indent:17.6pt; font-family:Arial; font-size:8pt">17.28</P>
</TD><TD valign=top width=96><P style="line-height:10pt; margin:0pt; text-indent:22.6pt; font-family:Arial; font-size:8pt">125,000</P>
</TD></TR>
<TR><TD valign=top width=116.267><P style="line-height:10pt; margin:0pt; text-indent:9.6pt; font-family:Arial; font-size:8pt">$19.77 - $24.01</P>
</TD><TD valign=top width=16.267><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt">$</P>
</TD><TD valign=top width=63.733><P style="line-height:10pt; margin:0pt; text-indent:10.4pt; font-family:Arial; font-size:8pt">19.50</P>
</TD><TD valign=top width=94.667><P style="line-height:10pt; margin:0pt; text-indent:25.6pt; font-family:Arial; font-size:8pt">229,332</P>
</TD><TD valign=top width=125.333><P style="line-height:10pt; margin:0pt; text-indent:35.6pt; font-family:Arial; font-size:8pt">48.61</P>
</TD><TD valign=top width=18.667><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt">$</P>
</TD><TD valign=top width=89.333><P style="line-height:10pt; margin:0pt; text-indent:17.6pt; font-family:Arial; font-size:8pt">13.52</P>
</TD><TD valign=top width=96><P style="line-height:10pt; margin:0pt; text-indent:26.6pt; font-family:Arial; font-size:8pt">21,438</P>
</TD></TR>
<TR><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=bottom width=116.267>&nbsp;</TD><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=bottom width=16.267><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt">$</P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=bottom width=63.733><P style="line-height:10pt; margin:0pt; text-indent:10.4pt; font-family:Arial; font-size:8pt">12.73</P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=bottom width=94.667><P style="line-height:10pt; margin:0pt; text-indent:19.6pt; font-family:Arial; font-size:8pt">1,082,665</P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=bottom width=125.333><P style="line-height:10pt; margin:0pt; text-indent:35.6pt; font-family:Arial; font-size:8pt">36.64</P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=bottom width=18.667><P style="line-height:10pt; margin:0pt; font-family:Arial; font-size:8pt">$</P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=bottom width=89.333><P style="line-height:10pt; margin:0pt; text-indent:21.6pt; font-family:Arial; font-size:8pt">9.76</P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=bottom width=96><P style="line-height:10pt; margin:0pt; text-indent:22.6pt; font-family:Arial; font-size:8pt">593,771</P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:0pt"><BR></P>
<P style="margin-top:0pt; margin-bottom:5pt; padding-left:28.05pt; font-family:Arial" align=justify>During the six months ended June 30, 2006, the Company recognized $0.9 million of stock-based compensation expense related to stock option grants.</P>
<P style="margin-top:10pt; margin-bottom:-12pt; padding-left:28.35pt; font-family:Arial"><B>10.</B></P>
<P style="margin-top:0pt; margin-bottom:10pt; padding-left:28.35pt; text-indent:43.65pt; font-family:Arial"><B>Changes in non-cash working capital Items </B></P>
<P style="margin-top:0pt; margin-bottom:10pt; font-family:Arial" align=justify>The following table summarizes the changes in non-cash working capital items:</P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=11.8></TD><TD width=143.7></TD><TD width=4.7></TD><TD width=16.4></TD><TD width=38.75></TD><TD width=4.7></TD><TD width=16.4></TD><TD width=51.95></TD><TD width=0.5></TD><TD width=4.7></TD><TD width=17.25></TD><TD width=49.55></TD><TD width=4.7></TD><TD width=17.6></TD><TD width=52.05></TD><TD width=4.7></TD></TR>
<TR><TD valign=top width=207.333 colspan=2>&nbsp;</TD><TD valign=top width=177.2 colspan=6><P style="margin:0pt; font-family:Arial" align=center>Three Months Ended</P>
</TD><TD valign=top width=201.4 colspan=8><P style="margin:0pt; font-family:Arial" align=center>Six Months Ended</P>
</TD></TR>
<TR><TD valign=top width=207.333 colspan=2>&nbsp;</TD><TD valign=top width=177.2 colspan=6><P style="margin:0pt; font-family:Arial" align=center>June 30,</P>
</TD><TD valign=top width=201.4 colspan=8><P style="margin:0pt; font-family:Arial" align=center>June 30,</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=207.333 colspan=2>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=79.8 colspan=3><P style="margin:0pt; font-family:Arial" align=center>2006</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=98.067 colspan=4><P style="margin:0pt; font-family:Arial" align=center>2005</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=95.333 colspan=3><P style="margin:0pt; font-family:Arial" align=center>2006</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=105.4 colspan=4><P style="margin:0pt; font-family:Arial" align=center>2005</P>
</TD></TR>
<TR><TD valign=top width=15.733>&nbsp;</TD><TD valign=top width=197.867 colspan=2><P style="margin:0pt; font-family:Arial">Accounts receivable </P>
</TD><TD valign=top width=21.867><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=57.933 colspan=2><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(6,838)</P>
</TD><TD valign=top width=21.867><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=76.2 colspan=3><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">4,052</P>
</TD><TD valign=top width=23><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=72.333 colspan=2><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(8,544)</P>
</TD><TD valign=top width=23.467><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=75.667 colspan=2><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">5,704</P>
</TD></TR>
<TR><TD valign=top width=15.733>&nbsp;</TD><TD valign=top width=197.867 colspan=2><P style="margin:0pt; font-family:Arial">Inventories</P>
</TD><TD valign=top width=21.867>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=57.933 colspan=2><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(838)</P>
</TD><TD valign=top width=21.867>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=76.2 colspan=3><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(3,126)</P>
</TD><TD valign=top width=23>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72.333 colspan=2><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(2,851)</P>
</TD><TD valign=top width=23.467>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=75.667 colspan=2><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(731)</P>
</TD></TR>
<TR><TD valign=top width=15.733>&nbsp;</TD><TD valign=top width=197.867 colspan=2><P style="margin:0pt; font-family:Arial">Prepaid expenses</P>
</TD><TD valign=top width=21.867>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=57.933 colspan=2><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">553</P>
</TD><TD valign=top width=21.867>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=76.2 colspan=3><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(1,017)</P>
</TD><TD valign=top width=23>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72.333 colspan=2><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">237</P>
</TD><TD valign=top width=23.467>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=75.667 colspan=2><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(900)</P>
</TD></TR>
<TR><TD valign=top width=15.733>&nbsp;</TD><TD valign=top width=197.867 colspan=2><P style="margin:0pt; font-family:Arial">Accounts payable and accrued liabilities</P>
</TD><TD valign=top width=21.867>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=57.933 colspan=2><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">18,867</P>
</TD><TD valign=top width=21.867>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=76.2 colspan=3><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(2,791)</P>
</TD><TD valign=top width=23>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72.333 colspan=2><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">22,306</P>
</TD><TD valign=top width=23.467>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=75.667 colspan=2><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(4,746)</P>
</TD></TR>
<TR><TD valign=top width=15.733>&nbsp;</TD><TD valign=top width=197.867 colspan=2><P style="margin:0pt; font-family:Arial">Other</P>
</TD><TD valign=top width=21.867>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=57.933 colspan=2><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">858</P>
</TD><TD valign=top width=21.867>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=76.2 colspan=3><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">1,333</P>
</TD><TD valign=top width=23>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=72.333 colspan=2><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">60</P>
</TD><TD valign=top width=23.467>
    <p style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=75.667 colspan=2><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">498</P>
</TD></TR>
<TR><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=top width=15.733>&nbsp;</TD><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=top width=197.867 colspan=2>&nbsp;</TD><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=top width=21.867><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=top width=57.933 colspan=2><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">12,602</P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=top width=21.867><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=top width=76.2 colspan=3><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(1,549)</P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=top width=23><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=top width=72.333 colspan=2><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">11,208</P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=top width=23.467><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=top width=75.667 colspan=2><P style="font-family: Arial; margin: 0pt; padding-right: 9pt" align="right">(175)</P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:0pt"><BR></P>
<P style="margin-top:10pt; margin-bottom:-12pt; padding-left:28.35pt; font-family:Arial"><B>11.</B></P>
<P style="margin-top:0pt; margin-bottom:10pt; padding-left:28.35pt; text-indent:43.65pt; font-family:Arial"><B>Supplemental cash flow information</B></P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=20.9></TD><TD width=232.3></TD><TD width=16.4></TD><TD width=65.2></TD><TD width=16.4></TD><TD width=61.2></TD></TR>
<TR><TD valign=top width=337.6 colspan=2>&nbsp;</TD><TD valign=top width=212.267 colspan=4><P style="margin:0pt; font-family:Arial" align=center>June 30,</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=337.6 colspan=2>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=108.8 colspan=2><P style="margin:0pt; font-family:Arial" align=center>2006</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=103.467 colspan=2><P style="margin:0pt; font-family:Arial" align=center>2005</P>
</TD></TR>
<TR><TD valign=top width=27.867>&nbsp;</TD><TD valign=top width=309.733><P style="margin:0pt; font-family:Arial">Shares issued on conversion of debentures </P>
</TD><TD valign=top width=21.867><P style="margin:0pt; font-family:Arial">$</P>
</TD><TD valign=top width=86.933><P style="margin:0pt; text-indent:30.1pt; font-family:Arial">86</P>
</TD><TD valign=top width=21.867><P style="margin:0pt; font-family:Arial">$</P>
</TD><TD valign=top width=81.6><P style="margin:0pt; text-indent:36.75pt; font-family:Arial">-</P>
</TD></TR>
<TR><TD valign=top width=27.867>&nbsp;</TD><TD valign=top width=309.733><P style="margin:0pt; font-family:Arial">Shares issued as compensation</P>
</TD><TD valign=top width=21.867><P style="margin:0pt; font-family:Arial">$</P>
</TD><TD valign=top width=86.933><P style="margin:0pt; text-indent:25.1pt; font-family:Arial">559</P>
</TD><TD valign=top width=21.867><P style="margin:0pt; font-family:Arial">$</P>
</TD><TD valign=top width=81.6><P style="margin:0pt; text-indent:25.1pt; font-family:Arial">420</P>
</TD></TR>
</TABLE>
  </center>
</div>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0>
<TR><TD valign=top width=27.867>&nbsp;</TD><TD valign=top width=309.733><P style="margin:0pt; font-family:Arial">Shares issued for purchase of Minera Triton S. A.</P>
</TD><TD valign=top width=21.867><P style="margin:0pt; font-family:Arial">$</P>
</TD><TD valign=top width=86.933><P style="margin:0pt; text-indent:12.6pt; font-family:Arial">47,381</P>
</TD><TD valign=top width=21.867><P style="margin:0pt; font-family:Arial">$</P>
</TD><TD valign=top width=81.6><P style="margin:0pt; text-indent:36.75pt; font-family:Arial">-</P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:10pt"><BR>
<BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">22</P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt; page-break-before:always"><B>Pan American Silver Corp.</B></P>
<P style="margin:0pt; font-family:Arial">Notes to Unaudited Interim Consolidated Financial Statements</P>
<P style="margin:0pt; font-family:Arial">As at June 30, 2006 and 2005 and for the three month periods then ended</P>
<P style="margin:0pt; font-family:Arial">(Tabular amounts are in thousands of US dollars, except for numbers of shares, price per share and per share amounts)</P>
<P style="margin:0pt; padding-top:3pt; border-top:0.5pt solid #000000"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="margin-top:10pt; margin-bottom:-12pt; padding-left:28.35pt; font-family:Arial"><B>12.</B></P>
<P style="margin-top:0pt; margin-bottom:10pt; padding-left:28.35pt; text-indent:43.65pt; font-family:Arial"><B>Segmented information</B></P>
<P style="margin-top:0pt; margin-bottom:10pt; font-family:Arial" align=justify>Substantially all of the Company&#146;s operations are within the mining sector, conducted through operations in six countries. &nbsp;Due to differences between mining and exploration activities, the Company has a separate budgeting process and measures the results of operations and exploration activities independently. &nbsp;The Corporate office provides support to the mining and exploration activities with respect to financial, human resources and technical support.</P>
<P style="margin-top:0pt; margin-bottom:10pt; font-family:Arial" align=justify>Segmented disclosures and enterprise-wide information are as follows:</P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=126.4></TD><TD width=8.65></TD><TD width=50.75></TD><TD width=8.65></TD><TD width=50.75></TD><TD width=8.65></TD><TD width=71.85></TD><TD width=8.65></TD><TD width=68></TD></TR>
<TR><TD width=168.533>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" width=158.4 colspan=4><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Revenue June 30</P>
</TD><TD width=11.533>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" width=198 colspan=3><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Net capital assets</P>
</TD></TR>
<TR><TD width=168.533>&nbsp;</TD><TD width=11.533>&nbsp;</TD><TD width=67.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>2006</P>
</TD><TD width=11.533>&nbsp;</TD><TD width=67.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>2005</P>
</TD><TD width=11.533>&nbsp;</TD><TD width=95.8><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>June 30, </P>
<P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>2006</P>
</TD><TD width=11.533>&nbsp;</TD><TD width=90.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>December 31, </P>
<P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>2005</P>
</TD></TR>
<TR><TD style="border-top:0.5pt solid #000000" width=168.533><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Peru</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=11.533><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=67.667><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">88,049</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=11.533><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=67.667><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">45,090</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=11.533><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=95.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">107,013</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=11.533><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=90.667><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">105,281</P>
</TD></TR>
<TR><TD valign=top width=168.533><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Canada</P>
</TD><TD valign=top width=11.533>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=67.667><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=11.533>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=67.667><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=11.533>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=95.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">210</P>
</TD><TD valign=top width=11.533>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=90.667><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">190</P>
</TD></TR>
<TR><TD valign=top width=168.533><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Mexico</P>
</TD><TD valign=top width=11.533>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=67.667><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">17,559</P>
</TD><TD valign=top width=11.533>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=67.667><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">9,384</P>
</TD><TD valign=top width=11.533>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=95.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">174,349</P>
</TD><TD valign=top width=11.533>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=90.667><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">142,258</P>
</TD></TR>
<TR><TD valign=top width=168.533><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">United States</P>
</TD><TD valign=top width=11.533>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=67.667><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=11.533>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=67.667><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=11.533>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=95.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">1,191</P>
</TD><TD valign=top width=11.533>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=90.667><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">1,198</P>
</TD></TR>
<TR><TD valign=top width=168.533><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Argentina</P>
</TD><TD valign=top width=11.533>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=67.667><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=11.533>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=67.667><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=11.533>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=95.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">72,459</P>
</TD><TD valign=top width=11.533>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=90.667><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">3,691</P>
</TD></TR>
<TR><TD valign=top width=168.533><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Bolivia</P>
</TD><TD valign=top width=11.533>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=67.667><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">2,984</P>
</TD><TD valign=top width=11.533>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=67.667><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=11.533>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=95.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">7,415</P>
</TD><TD valign=top width=11.533>
    <p style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">&nbsp;</p>
  </TD><TD valign=top width=90.667><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">4,762</P>
</TD></TR>
<TR><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=top width=168.533><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Total</P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=top width=11.533><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=top width=67.667><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">108,592</P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=top width=11.533><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=top width=67.667><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">54,444</P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=top width=11.533><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=top width=95.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">362,627</P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=top width=11.533><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-top:0.5pt solid #000000; border-bottom:2pt double #000000" valign=top width=90.667><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">257,380</P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=149.8></TD><TD width=11.9></TD><TD width=44.8></TD><TD width=13.3></TD><TD width=47.35></TD><TD width=11.8></TD><TD width=72.05></TD><TD width=11.8></TD><TD width=51.2></TD><TD width=11.8></TD><TD width=50.85></TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" width=199.733>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" width=435.8 colspan=10><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>For the three months ended June 30, 2006</P>
</TD></TR>
<TR><TD width=199.733 rowspan=2><P style="margin:0pt" align=center><BR></P>
</TD><TD width=15.867 rowspan=2>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" width=140.6 colspan=3><P style="line-height:11pt; margin-top:2.25pt; margin-bottom:2.25pt; font-family:Arial; font-size:9pt" align=center>Mining &amp; Development</P>
</TD><TD width=15.733 rowspan=2>&nbsp;</TD><TD width=96.067 rowspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Investment and exploration</P>
</TD><TD width=15.733 rowspan=2>&nbsp;</TD><TD width=68.267 rowspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Corporate</P>
</TD><TD width=15.733 rowspan=2>&nbsp;</TD><TD width=67.8 rowspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Total</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" width=59.733><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Mexico</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=17.733>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" width=63.133><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Peru</P>
</TD></TR>
<TR><TD style="border-top:0.5pt solid #000000" width=199.733><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Revenue from external customers</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=59.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">11,172</P>
</TD><TD valign=top width=17.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=63.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">51,493</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=96.067><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">183</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=67.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">62,848</P>
</TD></TR>
<TR><TD width=199.733><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Depreciation and amortization</P>
</TD><TD valign=top width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=59.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(1,617)</P>
</TD><TD valign=top width=17.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=63.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(2,461)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=96.067><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(68)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(29)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=67.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(4,175)</P>
</TD></TR>
<TR><TD valign=top width=199.733><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Reclamation accretion</P>
</TD><TD valign=top width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=59.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(84)</P>
</TD><TD valign=top width=17.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=63.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(530)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=96.067><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=67.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(614)</P>
</TD></TR>
<TR><TD valign=top width=199.733><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Interest and financing expense</P>
</TD><TD valign=top width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=59.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=17.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=63.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(147)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=96.067><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(56)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=67.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(203)</P>
</TD></TR>
<TR><TD valign=top width=199.733><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Investment and other income</P>
</TD><TD valign=top width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=59.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">2</P>
</TD><TD valign=top width=17.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=63.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">515</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=96.067><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">22</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">544</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=67.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">1,083</P>
</TD></TR>
<TR><TD valign=top width=199.733><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Loss on commodity and foreign</P>
<P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;currency contracts</P>
</TD><TD valign=top width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=59.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=17.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=63.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=96.067><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(4,780)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=67.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(4,780)</P>
</TD></TR>
<TR><TD valign=top width=199.733><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Exploration expense</P>
</TD><TD valign=top width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=59.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(313)</P>
</TD><TD valign=top width=17.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=63.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(107)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=96.067><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(203)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(14)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=67.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(637)</P>
</TD></TR>
<TR><TD valign=top width=199.733><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Income (loss) before taxes</P>
</TD><TD valign=top width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=59.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">4,047</P>
</TD><TD valign=top width=17.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=63.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">24,242</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=96.067><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(170)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(5,578)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=67.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">22,541</P>
</TD></TR>
<TR><TD valign=top width=199.733><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Net income (loss) for the period</P>
</TD><TD valign=top width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=59.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">4,047</P>
</TD><TD valign=top width=17.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=63.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">16,799</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=96.067><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(220)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(5,662)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=67.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">14,964</P>
</TD></TR>
<TR><TD valign=top width=199.733><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Property, plant and equipment &nbsp;&nbsp;</P>
<P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;capital expenditures</P>
</TD><TD valign=top width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=59.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">1,716</P>
</TD><TD valign=top width=17.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=63.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">4,581</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=96.067><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">30,508</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">180</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=67.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">36,985</P>
</TD></TR>
<TR><TD valign=top width=199.733><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Segment assets</P>
</TD><TD valign=top width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=59.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">33,139</P>
</TD><TD valign=top width=17.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=63.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">175,323</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=96.067><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">219,563</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">184,052</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=67.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">612,077</P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:0pt" align=justify><BR></P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=150.5></TD><TD width=11.8></TD><TD width=45.6></TD><TD width=11.9></TD><TD width=46.9></TD><TD width=12.6></TD><TD width=71.35></TD><TD width=12.6></TD><TD width=49.7></TD><TD width=13.3></TD><TD width=50.4></TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" width=200.667>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" width=434.867 colspan=10><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>For the three months ended June 30, 2005</P>
</TD></TR>
<TR><TD width=200.667 rowspan=2><P style="margin:0pt" align=center><BR></P>
</TD><TD width=15.733 rowspan=2>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" width=139.2 colspan=3><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Mining &amp; Development</P>
</TD><TD width=16.8 rowspan=2>&nbsp;</TD><TD width=95.133 rowspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Investment and exploration</P>
</TD><TD width=16.8 rowspan=2>&nbsp;</TD><TD width=66.267 rowspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Corporate</P>
</TD><TD width=17.733 rowspan=2>&nbsp;</TD><TD width=67.2 rowspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Total</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" width=60.8><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Mexico</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=15.867>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" width=62.533><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Peru</P>
</TD></TR>
<TR><TD style="border-top:0.5pt solid #000000" width=200.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Revenue from external customers</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=60.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">4,405</P>
</TD><TD valign=top width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=62.533><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">20,952</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=95.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=66.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=17.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=67.2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">25,358</P>
</TD></TR>
<TR><TD valign=top width=200.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Investment and other income</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=60.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=62.533><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(264)</P>
</TD><TD valign=top width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=95.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">19</P>
</TD><TD valign=top width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=66.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">543</P>
</TD><TD valign=top width=17.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=67.2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">298</P>
</TD></TR>
<TR><TD valign=top width=200.667><P style="line-height:11pt; margin:0pt; padding-left:14.2pt; text-indent:-14.2pt; font-family:Arial; font-size:9pt">Gain on commodity contracts</P>
</TD><TD width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=60.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=62.533><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=95.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=66.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">3,491</P>
</TD><TD width=17.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=67.2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">3,491</P>
</TD></TR>
<TR><TD valign=top width=200.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Interest and financing expenses</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=60.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=62.533><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=95.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=66.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(93)</P>
</TD><TD valign=top width=17.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=67.2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(93)</P>
</TD></TR>
<TR><TD valign=top width=200.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Exploration</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=60.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=62.533><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=95.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(677)</P>
</TD><TD valign=top width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=66.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(2,083)</P>
</TD><TD valign=top width=17.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=67.2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(2,760)</P>
</TD></TR>
<TR><TD valign=top width=200.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Depreciation and amortization</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=60.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(691)</P>
</TD><TD valign=top width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=62.533><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(1,719)</P>
</TD><TD valign=top width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=95.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=66.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(7)</P>
</TD><TD valign=top width=17.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=67.2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(2,415)</P>
</TD></TR>
<TR><TD valign=top width=200.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Net income (loss) for the period</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=60.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">808</P>
</TD><TD valign=top width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=62.533><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">2,824</P>
</TD><TD valign=top width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=95.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(704)</P>
</TD><TD valign=top width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=66.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(2,043)</P>
</TD><TD valign=top width=17.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=67.2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">4,971</P>
</TD></TR>
<TR><TD valign=top width=200.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Property, plant and equipment </P>
<P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">&nbsp;&nbsp;&nbsp;capital expenditures</P>
</TD><TD width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=60.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">878</P>
</TD><TD width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=62.533><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">5,711</P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=95.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">7,441</P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=66.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD width=17.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=67.2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">14,090</P>
</TD></TR>
<TR><TD valign=top width=200.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Segment assets</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=60.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">57,958</P>
</TD><TD valign=top width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=62.533><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">135,760</P>
</TD><TD valign=top width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=95.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">102,171</P>
</TD><TD valign=top width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=66.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">71,467</P>
</TD><TD valign=top width=17.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=67.2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">367,356</P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:0pt" align=justify><BR></P>
<P style="margin:0pt" align=justify><BR>
<BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">23</P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt; page-break-before:always"><B>Pan American Silver Corp.</B></P>
<P style="margin:0pt; font-family:Arial">Notes to Unaudited Interim Consolidated Financial Statements</P>
<P style="margin:0pt; font-family:Arial">As at June 30, 2006 and 2005 and for the three month periods then ended</P>
<P style="margin:0pt; font-family:Arial">(Tabular amounts are in thousands of US dollars, except for numbers of shares, price per share and per share amounts)</P>
<P style="margin:0pt; padding-top:3pt; border-top:0.5pt solid #000000"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt" align=justify><BR></P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=150.5></TD><TD width=11.85></TD><TD width=44.35></TD><TD width=0.5></TD><TD width=12.1></TD><TD width=47.9></TD><TD width=11.8></TD><TD width=72></TD><TD width=11.8></TD><TD width=51.2></TD><TD width=11.8></TD><TD width=51.2></TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=200.667>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" width=435.333 colspan=11><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>For the six months ended June 30, 2006</P>
</TD></TR>
<TR><TD width=200.667 rowspan=2>&nbsp;</TD><TD width=15.8 rowspan=2>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" width=139.8 colspan=4><P style="line-height:11pt; margin-top:2.25pt; margin-bottom:2.25pt; font-family:Arial; font-size:9pt" align=center>Mining &amp; Development</P>
</TD><TD width=15.733 rowspan=2>&nbsp;</TD><TD width=96 rowspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Investment and exploration</P>
</TD><TD width=15.733 rowspan=2>&nbsp;</TD><TD width=68.267 rowspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Corporate</P>
</TD><TD width=15.733 rowspan=2>&nbsp;</TD><TD width=68.267 rowspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Total</P>
</TD></TR>
<TR><TD style="border-bottom:1pt solid #000000" width=59.133><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Mexico</P>
</TD><TD style="border-bottom:1pt solid #000000" width=16.8 colspan=2>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" width=63.867><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Peru</P>
</TD></TR>
<TR><TD style="border-top:1pt solid #000000" width=200.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Revenue from external customers</P>
</TD><TD style="border-top:1pt solid #000000" width=15.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=59.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">17,559</P>
</TD><TD valign=top width=16.8 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=63.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">88,049</P>
</TD><TD style="border-top:1pt solid #000000" valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-top:1pt solid #000000" valign=top width=96><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">2,984</P>
</TD><TD style="border-top:1pt solid #000000" valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-top:1pt solid #000000" valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD style="border-top:1pt solid #000000" valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD style="border-top:1pt solid #000000" valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">108,592</P>
</TD></TR>
<TR><TD width=200.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Depreciation and amortization</P>
</TD><TD valign=top width=15.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=59.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(3,061)</P>
</TD><TD valign=top width=16.8 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=63.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(4,431)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=96><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(93)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(61)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(7,646)</P>
</TD></TR>
<TR><TD valign=top width=200.667><P style="line-height:11pt; margin:0pt; padding-left:14.2pt; text-indent:-14.2pt; font-family:Arial; font-size:9pt">Reclamation accretion</P>
</TD><TD valign=top width=15.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=59.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(168)</P>
</TD><TD valign=top width=16.8 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=63.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(1,060)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=96><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(1,228)</P>
</TD></TR>
<TR><TD width=200.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Interest and financing expenses</P>
</TD><TD valign=top width=15.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=59.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=16.8 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=63.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(213)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=96><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(136)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(349)</P>
</TD></TR>
<TR><TD width=200.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Investment and other income</P>
</TD><TD valign=top width=15.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=59.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">14</P>
</TD><TD valign=top width=16.8 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=63.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">439</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=96><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">22</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">865</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">1,340</P>
</TD></TR>
<TR><TD width=200.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Loss on commodity and foreign</P>
<P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">&nbsp;&nbsp;&nbsp;currency contracts</P>
</TD><TD valign=top width=15.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=59.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=16.8 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=63.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=96><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(16,610)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(16,610)</P>
</TD></TR>
<TR><TD width=200.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Exploration expense</P>
</TD><TD valign=top width=15.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=59.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(475)</P>
</TD><TD valign=top width=16.8 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=63.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(551)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=96><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(831)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(14)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(1,871)</P>
</TD></TR>
<TR><TD width=200.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Income (loss) before taxes</P>
</TD><TD valign=top width=15.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=59.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">3,760</P>
</TD><TD valign=top width=16.8 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=63.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">38,505</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=96><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">49</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(18,521)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">23,793</P>
</TD></TR>
<TR><TD width=200.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Net income (loss) for the period</P>
</TD><TD valign=top width=15.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=59.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">3,760</P>
</TD><TD valign=top width=16.8 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=63.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">27,133</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=96><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(1)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(18,689)</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">12,203</P>
</TD></TR>
<TR><TD valign=top width=200.667><P style="line-height:11pt; margin:0pt; padding-left:14.2pt; text-indent:-14.2pt; font-family:Arial; font-size:9pt">Property, plant and equipment </P>
<P style="line-height:11pt; margin:0pt; padding-left:14.2pt; text-indent:-14.2pt; font-family:Arial; font-size:9pt">&nbsp;&nbsp;&nbsp;capital expenditures</P>
</TD><TD valign=top width=15.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=59.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">2,676</P>
</TD><TD valign=top width=16.8 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=63.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">7,013</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=96><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">43,356</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">201</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
<P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">53,246</P>
</TD></TR>
<TR><TD width=200.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Segment assets</P>
</TD><TD width=15.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=59.8 colspan=2><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">33,139</P>
</TD><TD valign=top width=16.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=63.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">175,323</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=96><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">219,563</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">184,052</P>
</TD><TD valign=top width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align=right>$</P>
</TD><TD valign=top width=68.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">612,077</P>
</TD></TR>
</TABLE>
  </center>
</div>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<div align="center">
  <center>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=150.5></TD><TD width=11.8></TD><TD width=45.6></TD><TD width=11.9></TD><TD width=46.9></TD><TD width=12.6></TD><TD width=71.35></TD><TD width=12.6></TD><TD width=49.7></TD><TD width=12.6></TD><TD width=51.1></TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" width=200.667>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" width=434.867 colspan=10><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>For the six months ended June 30, 2005</P>
</TD></TR>
<TR><TD width=200.667 rowspan=2><P style="margin:0pt" align=center><BR></P>
</TD><TD width=15.733 rowspan=2>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" width=139.2 colspan=3><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Mining &amp; Development</P>
</TD><TD width=16.8 rowspan=2>&nbsp;</TD><TD width=95.133 rowspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Investment and exploration</P>
</TD><TD width=16.8 rowspan=2>&nbsp;</TD><TD width=66.267 rowspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Corporate</P>
</TD><TD width=16.8 rowspan=2>&nbsp;</TD><TD width=68.133 rowspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Total</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" width=60.8><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Mexico</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=15.867>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" width=62.533><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt" align=center>Peru</P>
</TD></TR>
<TR><TD style="border-top:0.5pt solid #000000" width=200.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Revenue from external customers</P>
</TD><TD style="border-top:0.5pt solid #000000" width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=60.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">9,383</P>
</TD><TD width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=62.533><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">45,090</P>
</TD><TD style="border-top:0.5pt solid #000000" width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=95.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD style="border-top:0.5pt solid #000000" width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=66.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD style="border-top:0.5pt solid #000000" width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD style="border-top:0.5pt solid #000000" valign=top width=68.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">54,444</P>
</TD></TR>
<TR><TD valign=top width=200.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Investment and other income</P>
</TD><TD width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=60.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">4</P>
</TD><TD width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=62.533><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(214)</P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=95.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(21)</P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=66.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">785</P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">554</P>
</TD></TR>
<TR><TD valign=top width=200.667><P style="line-height:11pt; margin:0pt; padding-left:14.2pt; text-indent:-14.2pt; font-family:Arial; font-size:9pt">Gain on commodity and foreign currency contracts</P>
</TD><TD width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=60.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=62.533><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=95.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right"><BR></P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=66.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">154</P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=68.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">154</P>
</TD></TR>
<TR><TD valign=top width=200.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Interest and financing expenses</P>
</TD><TD width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=60.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=62.533><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=95.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=66.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD></TR>
<TR><TD valign=top width=200.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Exploration</P>
</TD><TD width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=60.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(2)</P>
</TD><TD width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=62.533><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=95.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(2,130)</P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=66.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(272)</P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(2,402)</P>
</TD></TR>
<TR><TD valign=top width=200.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Depreciation and amortization</P>
</TD><TD width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=60.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(1,950)</P>
</TD><TD width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=62.533><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(3,670)</P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=95.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">-</P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=66.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(13)</P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(5,633)</P>
</TD></TR>
<TR><TD valign=top width=200.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Net income (loss) for the period</P>
</TD><TD width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=60.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(149)</P>
</TD><TD width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=62.533><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">5,636</P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=95.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(2,147)</P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=66.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">(2,592)</P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">748</P>
</TD></TR>
<TR><TD valign=top width=200.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Property, plant and equipment Capital expenditures</P>
</TD><TD width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=60.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">2,564</P>
</TD><TD width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=62.533><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">8,116</P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=95.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">13,542</P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=66.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">27</P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD width=68.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">24,249</P>
</TD></TR>
<TR><TD valign=top width=200.667><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Segment assets</P>
</TD><TD width=15.733><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=60.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">57,958</P>
</TD><TD width=15.867><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=62.533><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">102,171</P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=95.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">102,015</P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=66.267><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">71,467</P>
</TD><TD width=16.8><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">$</P>
</TD><TD valign=top width=68.133><P style="line-height: 11pt; font-family: Arial; font-size: 9pt; margin: 0pt; padding-right: 9pt" align="right">367,356</P>
</TD></TR>
</TABLE>
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<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">24</P>
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<P style="margin:0pt"><BR></P>
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<P style="line-height:18pt; margin-top:16pt; margin-bottom:4pt; font-family:Arial; font-size:16pt" align=justify>Second Quarter 2006 Management&#146;s Discussion and Analysis</P>
<P style="line-height:14pt; margin-top:18pt; margin-bottom:18pt; font-family:Arial; font-size:12pt"><B>August 1st 2006</B></P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify>The Management's Discussion and Analysis (MD&amp;A) focuses on significant factors that affected Pan American Silver Corp.&#146;s and its subsidiaries&#146; (&#147;Pan American&#148; or the &#147;Company&#148;) performance and such factors that may affect its future performance. &nbsp;The MD&amp;A for the second quarter ending June 30, 2006, and 2005, should be read in conjunction with the unaudited consolidated financial statements for the three months ended June 30, 2006 and 2005 and the related notes contained therein.&nbsp;</P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify>The significant accounting policies are outlined within Note 2 to the Consolidated Financial Statements of the Company for the year ended December 31, 2005. These accounting policies have been applied consistently for the three and six months ended June 30, 2006</P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify>The preparation of financial statements in conformity with Canadian GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The most significant estimates are related to the physical and economic lives of mineral assets, their recoverability, and site restoration and related obligations.</P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify>Some of the statements in this MD&amp;A are forward-looking statements, such as estimates of future production levels, expectations regarding mine production costs, expected trends in mineral prices and statements that describe Pan American's future plans, objectives or goals. &nbsp;Actual results and developments may differ materially from those contemplated by these statements depending on such factors as changes in general economic conditions and financial markets, changes in prices for silver and other metals, technological and operational hazards in Pan American's mining and mine development activities, uncertainties inherent in the calculation of mineral reserves, mineral resources and metal recoveries, the timing and availability of financing, governmental and other approvals, political unrest or instability in countries where Pan American is active, labor relations and other risk factors l
isted from time to time in Pan American&#146;s Annual Information Form and Form 40F.</P>
<P style="line-height:13pt; margin-top:16.5pt; margin-bottom:11pt; font-family:Arial; font-size:11pt"><B>Significant Events during the Second Quarter</B></P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify>On April 5, 2006, Pan American filed a preliminary prospectus supplement to its existing $150 million base shelf prospectus with the securities regulatory authorities in the provinces of Canada and with the SEC in connection with a public offering of common shares (the &#147;Offering&#148;). &nbsp;The Company completed the base Offering on April 18, 2006 and completed the over-allotment option of the Offering on April 21, 2006. &nbsp;The Offering consisted of 6.28 million common shares priced at $23.88 for gross proceeds of $150 million and net proceeds after deducting underwriting fees and other share issue costs, of $142.2 million. &nbsp;Pan American expects to use the proceeds of the Offering for the construction and development of its Manantial Espejo silver project in Argentina. &nbsp;</P>
<P style="margin-top:0pt; margin-bottom:11pt" align=justify><BR>
<BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">25</P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
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<P style="margin:0pt"><BR></P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify>On April 12, 2006, Pan American announced that it had closed the acquisition of a 50 per cent interest in the Manantial Espejo project from Silver Standard Resources Inc. &nbsp;The transaction gave Pan American a 100 per cent interest in Manantial Espejo. &nbsp;The purchase price of $47.5 million was paid with 1.95 million common shares of Pan American.</P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify>Prior to June 30, 2006, the Company bought 6,000 tonnes of zinc settling between July and December 2006. &nbsp;These forward purchases were entered into to exactly offset all of the Company&#146;s zinc forward sales positions, leaving the Company with no open zinc positions as at June 30, 2006. &nbsp;The effect of these transactions was to crystallize a loss of $8.3 million, which has been recorded in the consolidated statement of operations. &nbsp;These transactions will have no further impact on the Company&#146;s earnings and the Company&#146;s future zinc production is now fully exposed to zinc cash prices.</P>
<P style="line-height:13pt; margin-top:16.5pt; margin-bottom:11pt; font-family:Arial; font-size:11pt"><B>Results of Operations </B></P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify>For the three months ended June 30, 2006, the Company generated record net income of $15 million (basic income per share of $0.21) compared to net income of $5.0 million (basic income per share of $0.07) for the corresponding period in 2005. &nbsp;The improved financial results for the quarter are primarily due to significantly higher silver prices, increased silver production and record low costs per ounce of silver (net of higher base metal by-product credits). &nbsp;The Company&#146;s record earnings for the second quarter included a $4.8 million loss from forward sale contracts. Specifically, the Company realized only $1,603 per tonne on approximately 53% of its payable zinc production, which had been previously sold forward. &nbsp;This was significantly below the average zinc price of $3,059 per tonne for the period. &nbsp;</P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify>For the six-month period ended June 30, 2006 the Company had net income of $ 12.2 million, compared to net income of $0.7 million for the corresponding period in 2005. &nbsp;Increased silver and zinc production combined with higher realized prices were the primary reasons for the dramatic increase in net income for the six-month period ended June 30, 2006 versus the comparable 2005 period. &nbsp;The net income for the six-month period ended June 30, 2006 includes a loss of $16.6 million relating to commodity and currency contracts, (compared to a gain of $0.2 million for the same period in 2005) and an income tax provision of $11.6 million, (compared to an expense of $1.7 million for the same period in 2005). &nbsp;</P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify><B><I>Sales</I></B> for the second quarter of 2006 were $62.8 million, a 148 per cent increase from <I>sales</I> in the corresponding period in 2005. &nbsp;Sales in the second quarter of 2006 benefited from significantly higher realized metal prices, increased production from the La Colorada mine and a 22 per cent increase in the quantity of concentrate shipped from the Company&#146;s Peruvian operations versus the year-earlier period (shipments of concentrate are an essential criterion for revenue recognition). &nbsp;The Company shipped approximately the same quantity of concentrate as it produced during the second quarter of 2006. &nbsp;At the end of the second quarter the Company had approximately 13,200 tonnes of concentrate inventory on hand and expects to ship this inventory and recognize the related revenues in the third and fourth quarters of 2006. </P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify><I>Sales</I> for the six-month period ended June 30, 2006 were almost double the <I>sales</I> for the comparable period in 2005, due primarily to higher realized metal prices, increased </P>
<P style="margin-top:0pt; margin-bottom:11pt" align=justify><BR>
<BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">26</P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
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<P style="margin:0pt"><BR></P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify>production from the La Colorada and San Vicente mines and slightly higher concentrate shipments from the Peruvian operations. </P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify><B><I>Cost of sales</I></B> for the three months ended June 30, 2006 was $27.6 million, a 50 per cent increase from the $18.4 million recorded in the same period of 2005. &nbsp;Similar to <I>sales</I> for the second quarter of 2006, <I>cost of sales</I> increased due to the fact that the Company shipped approximately 6,160 more tonnes of concentrates from the three mines in Peru relative to the comparable period in 2005. &nbsp;<I>Cost of sales </I>was also negatively impacted by significantly increased worker&#146;s participation costs in Peru, which are based on higher taxable income generated. &nbsp;Further increases in <I>cost of sales</I> were seen at the La Colorada mine, where mining and milling rates increased by approximately 9 per cent relative to a year ago. &nbsp;</P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify><I>Cost of sales</I> for the six-month period ended June 30, 2006, increased by 27 per cent over the comparable period of 2005. &nbsp;The factors described above plus the <I>cost of sales</I> of the San Vicente mine in Bolivia, which was operating in the first quarter of 2006, were the primary reasons for the increase from the comparable period in 2005.</P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify><B><I>Depreciation and amortization charges</I></B> for the second quarter of 2006 increased to $4.2 million from $2.4 million recorded for the corresponding period in 2005. &nbsp;For the six-month period ended June 30, 2006, these charges increased to $7.6 million from $5.6 million a year ago. &nbsp;The higher level of concentrate shipments and milling rates at La Colorada were the main reasons for the increase in both the three-month and six-month periods ended June 30, 2006 compared to the <I>depreciation and amortization charges</I> recorded in the respective periods of 2005.</P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify><B><I>Mine operating earnings</I></B> in the second quarter of 2006 were a record $31.1 million, which is approximately seven times the mine operating earnings generated in the second quarter 2005 of $4.5 million, and almost double the mine operating earnings generated in the first quarter of 2006. &nbsp;During the six-month period ended June 30, 2006, the Company generated <I>mine operating earnings</I> of $49 million compared to <I>mine operating earnings</I> of $8 million in the same period of 2005. &nbsp;Higher metal prices, increasing silver production profile and declining costs, net of by-product credits, resulted in the improving trend in mine operating earnings over the last three years. &nbsp;The table below sets out selected quarterly results for the past fourteen quarters, which are stated in thousands of US dollars, except for the per share amounts.</P>
<P style="margin:0pt"><BR>
<BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">27</P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="margin:0pt; page-break-before:always"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<TABLE style="font-size:10pt" cellspacing=0 align=center><TR><TD width=29.45></TD><TD width=60.9></TD><TD width=22.4></TD><TD width=51.1></TD><TD width=17.5></TD><TD width=72.1></TD><TD width=23.1></TD><TD width=70.65></TD><TD width=21.7></TD><TD width=59.5></TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" width=39.267><P style="margin:0pt; font-family:Arial" align=center><B>Year</B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=81.2><P style="margin:0pt; font-family:Arial" align=center><B>Quarter</B></P>
<P style="margin:0pt; font-family:Arial" align=center><B>(unaudited)</B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=98 colspan=2><P style="margin:0pt; font-family:Arial" align=center><B>Sales</B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=119.467 colspan=2><P style="margin:0pt; font-family:Arial" align=center><B>Mine operating earnings/(loss)<SUP>(1)</SUP></B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=125 colspan=2><P style="margin:0pt; font-family:Arial" align=center><B>Net income/(loss) for the period</B></P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=108.267 colspan=2><P style="margin:0pt; font-family:Arial" align=center><B>Diluted income (loss) per share</B></P>
</TD></TR>
<TR><TD valign=bottom width=39.267><P style="margin:0pt; font-family:Arial" align=right>2006</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=81.2><P style="margin-top:5pt; margin-bottom:0pt; padding-right:11.85pt; font-family:Arial" align=right>June 30</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=29.867><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=68.133><P style="margin:0pt; text-indent:12.1pt; font-family:Arial">62,848</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=23.333><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=96.133><P style="margin:0pt; text-indent:17.95pt; font-family:Arial">31,060</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=30.8><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=94.2><P style="margin:0pt; text-indent:16.05pt; font-family:Arial">14,964</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=28.933><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=79.333><P style="margin:0pt; text-indent:16.6pt; font-family:Arial">0.20</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=39.267>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=81.2><P style="margin:0pt; padding-right:11.85pt; font-family:Arial" align=right>March 31</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=29.867><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=68.133><P style="margin:0pt; text-indent:12.1pt; font-family:Arial">45,744</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=23.333><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=96.133><P style="margin:0pt; text-indent:17.95pt; font-family:Arial">17,976</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=30.8><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=94.2><P style="margin:0pt; text-indent:14.35pt; font-family:Arial">(2,761)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=28.933><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=79.333><P style="margin:0pt; text-indent:13.25pt; font-family:Arial">(0.04)</P>
</TD></TR>
<TR><TD valign=bottom width=39.267><P style="margin:0pt; font-family:Arial" align=right>2005</P>
</TD><TD valign=bottom width=81.2><P style="margin:0pt; padding-right:11.85pt; font-family:Arial" align=right>Dec.31</P>
</TD><TD valign=bottom width=29.867><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=bottom width=68.133><P style="margin:0pt; text-indent:12.1pt; font-family:Arial">37,871</P>
</TD><TD valign=bottom width=23.333><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=bottom width=96.133><P style="margin:0pt; text-indent:22.95pt; font-family:Arial">8,683</P>
</TD><TD valign=bottom width=30.8><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=bottom width=94.2><P style="margin:0pt; text-indent:9.35pt; font-family:Arial">(29,514)</P>
</TD><TD valign=bottom width=28.933><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=bottom width=79.333><P style="margin:0pt; text-indent:13.25pt; font-family:Arial">(0.44)</P>
</TD></TR>
<TR><TD valign=bottom width=39.267>&nbsp;</TD><TD valign=bottom width=81.2><P style="margin:0pt; padding-right:11.85pt; font-family:Arial" align=right>Sept. 30</P>
</TD><TD valign=bottom width=29.867><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=bottom width=68.133><P style="margin:0pt; text-indent:12.1pt; font-family:Arial">30,086</P>
</TD><TD valign=bottom width=23.333><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=bottom width=96.133><P style="margin:0pt; text-indent:22.95pt; font-family:Arial">4,961</P>
</TD><TD valign=bottom width=30.8><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=bottom width=94.2><P style="margin:0pt; text-indent:28.55pt; font-family:Arial">172</P>
</TD><TD valign=bottom width=28.933><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=bottom width=79.333><P style="margin:0pt; text-indent:16.6pt; font-family:Arial">0.00</P>
</TD></TR>
<TR><TD valign=bottom width=39.267>&nbsp;</TD><TD style="background-color:#FFFF99" valign=bottom width=81.2><P style="margin:0pt; padding-right:11.85pt; font-family:Arial" align=right>June 30</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=29.867><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=68.133><P style="margin:0pt; text-indent:12.1pt; font-family:Arial">25,358</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=23.333><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=96.133><P style="margin:0pt; text-indent:22.95pt; font-family:Arial">4,526</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=30.8><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=94.2><P style="margin:0pt; text-indent:21.05pt; font-family:Arial">4,971</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=28.933><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD style="background-color:#FFFF99" valign=bottom width=79.333><P style="margin:0pt; text-indent:16.6pt; font-family:Arial">0.07</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=39.267>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" width=81.2><P style="margin:0pt; padding-right:11.85pt; font-family:Arial" align=right>March 31</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=29.867><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=68.133><P style="margin:0pt; text-indent:12.1pt; font-family:Arial">29,086</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=23.333><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=96.133><P style="margin:0pt; text-indent:22.95pt; font-family:Arial">3,488</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=30.8><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=94.2><P style="margin:0pt; text-indent:14.35pt; font-family:Arial">(4,223)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=28.933><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD style="border-bottom:0.5pt solid #000000" width=79.333><P style="margin:0pt; text-indent:13.25pt; font-family:Arial">(0.06)</P>
</TD></TR>
<TR><TD valign=top width=39.267><P style="margin:0pt; font-family:Arial" align=right>2004</P>
</TD><TD valign=top width=81.2><P style="margin:0pt; padding-right:11.85pt; font-family:Arial" align=right>Dec. 31</P>
</TD><TD valign=top width=29.867><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=bottom width=68.133><P style="margin:0pt; text-indent:12.1pt; font-family:Arial">30,022</P>
</TD><TD valign=top width=23.333><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=top width=96.133><P style="margin:0pt; text-indent:22.95pt; font-family:Arial">3,402</P>
</TD><TD valign=top width=30.8><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=bottom width=94.2><P style="margin:0pt; text-indent:16.05pt; font-family:Arial">13,527</P>
</TD><TD valign=top width=28.933><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=top width=79.333><P style="margin:0pt; text-indent:16.6pt; font-family:Arial">0.21</P>
</TD></TR>
<TR><TD valign=top width=39.267>&nbsp;</TD><TD valign=top width=81.2><P style="margin:0pt; padding-right:11.85pt; font-family:Arial" align=right>Sept. 30</P>
</TD><TD valign=top width=29.867><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=bottom width=68.133><P style="margin:0pt; text-indent:12.1pt; font-family:Arial">27,916</P>
</TD><TD valign=top width=23.333><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=top width=96.133><P style="margin:0pt; text-indent:22.95pt; font-family:Arial">6,357</P>
</TD><TD valign=top width=30.8><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=bottom width=94.2><P style="margin:0pt; text-indent:28.55pt; font-family:Arial">358</P>
</TD><TD valign=top width=28.933><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=top width=79.333><P style="margin:0pt; text-indent:16.6pt; font-family:Arial">0.01</P>
</TD></TR>
<TR><TD valign=top width=39.267>&nbsp;</TD><TD valign=top width=81.2><P style="margin:0pt; padding-right:11.85pt; font-family:Arial" align=right>June 30</P>
</TD><TD valign=top width=29.867><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=bottom width=68.133><P style="margin:0pt; text-indent:12.1pt; font-family:Arial">21,179</P>
</TD><TD valign=top width=23.333><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=top width=96.133><P style="margin:0pt; text-indent:22.95pt; font-family:Arial">2,640</P>
</TD><TD valign=top width=30.8><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=bottom width=94.2><P style="margin:0pt; text-indent:21.05pt; font-family:Arial">3,352</P>
</TD><TD valign=top width=28.933><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=top width=79.333><P style="margin:0pt; text-indent:13.25pt; font-family:Arial">(0.09)<SUP>(2)</SUP></P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=39.267>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=81.2><P style="margin:0pt; padding-right:11.85pt; font-family:Arial" align=right>March 31</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=29.867><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=68.133><P style="margin:0pt; text-indent:12.1pt; font-family:Arial">15,708</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=23.333><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=96.133><P style="margin:0pt; text-indent:22.95pt; font-family:Arial">2,395</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=30.8><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=94.2><P style="margin:0pt; text-indent:14.35pt; font-family:Arial">(2,023)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=28.933><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=79.333><P style="margin:0pt; text-indent:13.25pt; font-family:Arial">(0.08)<SUP>(2)</SUP></P>
</TD></TR>
<TR><TD valign=top width=39.267><P style="margin:0pt; font-family:Arial" align=right>2003</P>
</TD><TD valign=top width=81.2><P style="margin:0pt; padding-right:11.85pt; font-family:Arial" align=right>Dec.31</P>
</TD><TD valign=top width=29.867><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=bottom width=68.133><P style="margin:0pt; text-indent:12.1pt; font-family:Arial">12,857</P>
</TD><TD valign=top width=23.333><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=top width=96.133><P style="margin:0pt; text-indent:35.45pt; font-family:Arial">81</P>
</TD><TD valign=top width=30.8><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=bottom width=94.2><P style="margin:0pt; text-indent:14.35pt; font-family:Arial">(2,840)</P>
</TD><TD valign=top width=28.933><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=top width=79.333><P style="margin:0pt; text-indent:13.25pt; font-family:Arial">(0.05)<SUP>(2)</SUP></P>
</TD></TR>
<TR><TD valign=top width=39.267>&nbsp;</TD><TD valign=top width=81.2><P style="margin:0pt; padding-right:11.85pt; font-family:Arial" align=right>Sept. 30</P>
</TD><TD valign=top width=29.867><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=bottom width=68.133><P style="margin:0pt; text-indent:12.1pt; font-family:Arial">11,890</P>
</TD><TD valign=top width=23.333><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=top width=96.133><P style="margin:0pt; text-indent:22.95pt; font-family:Arial">1,258</P>
</TD><TD valign=top width=30.8><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=bottom width=94.2><P style="margin:0pt; text-indent:14.35pt; font-family:Arial">(1,225)</P>
</TD><TD valign=top width=28.933><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=top width=79.333><P style="margin:0pt; text-indent:13.25pt; font-family:Arial">(0.10)<SUP>(2)</SUP></P>
</TD></TR>
<TR><TD valign=top width=39.267>&nbsp;</TD><TD valign=top width=81.2><P style="margin:0pt; padding-right:11.85pt; font-family:Arial" align=right>June 30</P>
</TD><TD valign=top width=29.867><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=bottom width=68.133><P style="margin:0pt; text-indent:12.1pt; font-family:Arial">12,553</P>
</TD><TD valign=top width=23.333><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=top width=96.133><P style="margin:0pt; text-indent:30.45pt; font-family:Arial">758</P>
</TD><TD valign=top width=30.8><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=bottom width=94.2><P style="margin:0pt; text-indent:14.35pt; font-family:Arial">(1,156)</P>
</TD><TD valign=top width=28.933><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD valign=top width=79.333><P style="margin:0pt; text-indent:13.25pt; font-family:Arial">(0.02)</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=39.267>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=81.2><P style="margin:0pt; padding-right:11.85pt; font-family:Arial" align=right>March 31</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=29.867><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=68.133><P style="margin:0pt; text-indent:17.1pt; font-family:Arial">7,822</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=23.333><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=96.133><P style="margin:0pt; text-indent:28.75pt; font-family:Arial">(78)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=30.8><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=bottom width=94.2><P style="margin:0pt; text-indent:14.35pt; font-family:Arial">(1,573)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=28.933><P style="margin:0pt; font-family:Arial" align=right>$</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=79.333><P style="margin:0pt; text-indent:13.25pt; font-family:Arial">(0.03)</P>
</TD></TR>
</TABLE>
<P style="margin:0pt"><BR></P>
<P style="line-height:11pt; margin-top:0pt; margin-bottom:-11pt; padding-left:36.75pt; text-indent:-18.75pt; font-family:Arial; font-size:9pt" align=justify>(1)</P>
<P style="line-height:11pt; margin:0pt; padding-left:36.75pt; font-family:Arial; font-size:9pt" align=justify>Mine operating earnings/(loss) are equal to revenues less operating costs and depreciation and amortization</P>
<P style="line-height:11pt; margin-top:0pt; margin-bottom:-11pt; padding-left:36.75pt; text-indent:-18.75pt; font-family:Arial; font-size:9pt" align=justify>(2)</P>
<P style="line-height:11pt; margin:0pt; padding-left:36.75pt; font-family:Arial; font-size:9pt" align=justify>Includes charges associated with early conversion and accretion of the Debentures</P>
<P style="margin:0pt"><BR></P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify><B><I>General and administration costs</I></B> for the three-month period ended June 30, 2006, including stock-based compensation, were $2.4 million. These costs, which were $1.8 million for the comparable quarter in 2005, were negatively impacted by the continued strength in the Canadian dollar as compared to the US dollar and additional costs associated with the Company&#146;s Sarbanes Oxley compliance project. &nbsp;G<I>eneral and administration costs</I> of $4.3 million for the six-month period ended June 30, 2006 (compared to $3.3 million in the same period in 2005), increased primarily for the same reasons.</P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify><B><I>Exploration</I></B> expenses for the second quarter of 2006 were $0.6 million (second quarter 2005, $0.9 million) and mostly reflect exploration activities at Morococha and La Colorada. &nbsp;Based on positive exploration results, the Company expects to continue a similar level of exploration activity for the remainder of the year. &nbsp;<I>Exploration</I> expenses for the first six-months of 2006 were $1.9 million (2005, $2.3 million). &nbsp;Exploration costs in the three-month and six-month comparable periods of 2005 were incurred primarily to complete the feasibility study for the Manantial Espejo project, which is now under construction.</P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify><B><I>Asset retirement and reclamation</I></B> expense of $0.6 million in the second quarter of 2006 (second quarter 2005, $0.4 million) related to the accretion of the Company&#146;s mines closure liabilities. &nbsp;The accretion for the six-month period ended June 30, 2006 was $1.2 million compared to $0.9 million for the same period of 2005. &nbsp;The increase in the accretion charge relative to last year is directly due to the Company increasing its estimate for the future consolidated mine closure liability at the end of 2005.</P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify><B><I>Interest and financing expense</I></B> in the second quarter of 2006 of $0.2 million increased from the $0.1 million of interest expenses incurred during the same period in 2005 due to increases in transactional bank fees. </P>
<P style="margin-top:0pt; margin-bottom:11pt" align=justify><BR>
<BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">28</P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="margin:0pt; page-break-before:always"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify><B><I>Investment and other income</I></B> of $1.1 million (second quarter 2005, $1.0 million) represented interest income received from cash balances the Company maintained during the quarter. &nbsp;<I>Investment and other income</I> for the six-month period ended June 30, 2006 was of $1.3 million (2005, $1.2 million). &nbsp;The higher interest rate environment prevailing in 2006, combined with higher average cash balances resulted in the increase over the comparable periods.</P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify><B><I>Income tax provision</I></B> of $7.6 million for the second quarter was a significant increase from the $0.7 million in the comparable period of 2005 due to sharply higher taxable income generated by the Company&#146;s Peruvian entities and the fact that these entities utilized their remaining tax loss carry forwards in 2005. <I>&nbsp;Income tax provision</I> for the six-month period ended June 30, 2006 increased to $11.6 million from $1.7 million recorded in the same period of 2005 due to the same reasons.</P>
<P style="line-height:13pt; margin-top:16.5pt; margin-bottom:11pt; font-family:Arial; font-size:11pt"><B>Metal Production </B></P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify>Pan American produced 3,317,369 ounces of silver in the second quarter of 2006, a 7 per cent increase from the corresponding period in 2005. &nbsp;Silver production increased at all of the Company&#146;s operations, other than at Huaron, due primarily to increased milling rates. &nbsp;The most significant increases in silver production were at La Colorada and Morococha, which achieved 23 per cent and 12 per cent increases, respectively. </P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify>Consolidated base metal production also increased over production levels from a year ago, with higher mill tonnage outweighing the impact of slightly lower ore grades. Please refer to the &#147;Financial &amp; Operating Highlights&#148; section of this second quarter report for a detailed breakdown of each mine&#146;s production data.</P>
<P style="line-height:13pt; margin-top:16.5pt; margin-bottom:11pt; font-family:Arial; font-size:11pt"><B>Cash and Total Production Costs per Ounce for Payable Silver</B></P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify>Consolidated cash costs for the three-month period ended June 30, 2006 were a record low of $1.17 per ounce compared to $4.48 per ounce for the corresponding period of 2005. &nbsp;This $3.31 per ounce decrease in cash costs was primarily a result of the increase in by-product credits generated from increased base metal production at higher metal prices. &nbsp;At both Morococha and Quiruvilca, the by-product credits were greater than the operating costs, resulting in cash costs per ounce of negative $3.81 and negative $1.07 respectively. &nbsp;The cash costs per ounce as compared to the same period in 2005 dropped by $6.59 at Morococha, by $5.53 at Quiruvilca and by $3.53 at Huaron. &nbsp;At La Colorada, which is a nearly pure silver mine and thus realizes only minor by-product credits, cash costs per ounce of $5.56 were similar to those recorded a year ago. &nbsp;Only the Company&#146;s Pyrite Sto
ckpile operation recorded higher costs than it had a year ago due to the fact that the cost structure of that operation is linked to silver prices, resulting in higher costs when silver prices are higher.</P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify>The Company reports the non-GAAP cash cost per ounce of payable silver in order to manage and evaluate operating performance at each of the Company&#146;s mines. &nbsp;The measure is widely used in the silver mining industry as a benchmark for performance, but does not have standardized meaning. &nbsp;To facilitate a better understanding of this measure as calculated by the Company, we have provided a detailed reconciliation of this measure to our c<I>ost of sales</I>, as shown in our unaudited Consolidated Statement of Operations for the period.</P>
<P style="margin-top:0pt; margin-bottom:11pt" align=justify><BR>
<BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">29</P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
<HR style="padding-top:7.2pt; padding-bottom:7.2pt" noshade size=1.333>
<P style="margin:0pt; page-break-before:always"><BR></P>
<P style="margin:0pt"><BR></P>
<P style="margin-top:0pt; margin-bottom:11pt" align=justify><BR></P>
<TABLE style="font-size:10pt" cellspacing=0><TR><TD width=143.25></TD><TD width=46></TD><TD width=7.8></TD><TD width=8.4></TD><TD width=48.85></TD><TD width=8.4></TD><TD width=9.1></TD><TD width=46.8></TD><TD width=11.9></TD><TD width=8.1></TD><TD width=44.8></TD><TD width=9.7></TD><TD width=8.45></TD><TD width=51.8></TD></TR>
<TR><TD valign=top width=252.333 colspan=2 rowspan=2>&nbsp;</TD><TD valign=top width=172.467 colspan=6><P style="margin:0pt; font-family:Arial" align=center><B>Three months ended </B></P>
<P style="margin:0pt; font-family:Arial" align=center><B>June 30</B></P>
</TD><TD valign=top width=179.667 colspan=6><P style="margin:0pt; font-family:Arial" align=center><B>Six months ended </B></P>
<P style="margin:0pt; font-family:Arial" align=center><B>June 30</B></P>
</TD></TR>
<TR><TD valign=top width=10.4>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=top width=76.333 colspan=2><P style="margin:0pt; font-family:Arial" align=right><B>2006</B></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=85.733 colspan=3><P style="margin:0pt; font-family:Arial" align=right><B>2005</B></P>
</TD><TD valign=top width=15.867>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=top width=70.533 colspan=2><P style="margin:0pt; font-family:Arial" align=right><B>2006</B></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=93.267 colspan=3><P style="margin:0pt; font-family:Arial" align=right><B>2005</B></P>
</TD></TR>
<TR><TD width=252.333 colspan=2><P style="line-height:11pt; margin-top:4.5pt; margin-bottom:4.5pt; font-family:Arial; font-size:9pt" align=justify><B>Cost of sales</B></P>
</TD><TD valign=top width=10.4>&nbsp;</TD><TD width=11.2><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; font-family:Arial; font-size:9pt">$</P>
</TD><TD width=65.133><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:17.95pt; font-family:Arial; font-size:9pt">27,613</P>
</TD><TD valign=top width=11.2>&nbsp;</TD><TD width=12.133><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; font-family:Arial; font-size:9pt">$</P>
</TD><TD width=62.4><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:10.95pt; font-family:Arial; font-size:9pt">18,417</P>
</TD><TD valign=top width=15.867>&nbsp;</TD><TD width=10.8><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; font-family:Arial; font-size:9pt">$</P>
</TD><TD width=59.733><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:15.35pt; font-family:Arial; font-size:9pt">51,910</P>
</TD><TD valign=top width=12.933>&nbsp;</TD><TD width=11.267><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; font-family:Arial; font-size:9pt">$</P>
</TD><TD width=69.067><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:18.55pt; font-family:Arial; font-size:9pt">40,797</P>
</TD></TR>
<TR><TD valign=top width=252.333 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Add/(Subtract)</P>
</TD><TD valign=top width=10.4>&nbsp;</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=65.133><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=12.133>&nbsp;</TD><TD valign=top width=62.4>&nbsp;</TD><TD valign=top width=15.867>&nbsp;</TD><TD valign=top width=10.8>&nbsp;</TD><TD valign=top width=59.733><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=12.933>&nbsp;</TD><TD valign=top width=11.267>&nbsp;</TD><TD valign=top width=69.067><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=top width=252.333 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Smelting, refining, and transportation charges</P>
</TD><TD valign=top width=10.4>&nbsp;</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=65.133><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:17.95pt; font-family:Arial; font-size:9pt">16,594</P>
</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=12.133>&nbsp;</TD><TD valign=top width=62.4><P style="line-height:11pt; margin:0pt; padding-left:-5.55pt; padding-right:-62.85pt; text-indent:24.75pt; font-family:Arial; font-size:9pt">9,061</P>
</TD><TD valign=top width=15.867>&nbsp;</TD><TD valign=top width=10.8>&nbsp;</TD><TD valign=top width=59.733><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:15.35pt; font-family:Arial; font-size:9pt">30,679</P>
</TD><TD valign=top width=12.933>&nbsp;</TD><TD valign=top width=11.267>&nbsp;</TD><TD valign=top width=69.067><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:18.55pt; font-family:Arial; font-size:9pt">17,734</P>
</TD></TR>
<TR><TD valign=top width=252.333 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">By-product credits</P>
</TD><TD valign=top width=10.4>&nbsp;</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=65.133><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:11.95pt; font-family:Arial; font-size:9pt">(41,265)</P>
</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=12.133>&nbsp;</TD><TD valign=top width=62.4><P style="line-height:11pt; margin:0pt; padding-left:-5.55pt; padding-right:-62.85pt; text-indent:14.25pt; font-family:Arial; font-size:9pt">(18,219)</P>
</TD><TD valign=top width=15.867>&nbsp;</TD><TD valign=top width=10.8>&nbsp;</TD><TD valign=top width=59.733><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:9.35pt; font-family:Arial; font-size:9pt">(73,593)</P>
</TD><TD valign=top width=12.933>&nbsp;</TD><TD valign=top width=11.267>&nbsp;</TD><TD valign=top width=69.067><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:12.55pt; font-family:Arial; font-size:9pt">(35,616)</P>
</TD></TR>
<TR><TD valign=top width=252.333 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Mining royalties</P>
</TD><TD valign=top width=10.4>&nbsp;</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=65.133><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:29.2pt; font-family:Arial; font-size:9pt">838</P>
</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=12.133>&nbsp;</TD><TD valign=top width=62.4><P style="line-height:11pt; margin:0pt; padding-left:-5.55pt; padding-right:-62.85pt; text-indent:31.5pt; font-family:Arial; font-size:9pt">337</P>
</TD><TD valign=top width=15.867>&nbsp;</TD><TD valign=top width=10.8>&nbsp;</TD><TD valign=top width=59.733><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:19.85pt; font-family:Arial; font-size:9pt">1,685</P>
</TD><TD valign=top width=12.933>&nbsp;</TD><TD valign=top width=11.267>&nbsp;</TD><TD valign=top width=69.067><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:29.8pt; font-family:Arial; font-size:9pt">782</P>
</TD></TR>
<TR><TD valign=top width=252.333 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Workers participation</P>
</TD><TD valign=top width=10.4>&nbsp;</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=65.133><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:16.45pt; font-family:Arial; font-size:9pt">(2,478)</P>
</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=12.133>&nbsp;</TD><TD valign=top width=62.4><P style="line-height:11pt; margin:0pt; padding-left:-5.55pt; padding-right:-62.85pt; text-indent:25.5pt; font-family:Arial; font-size:9pt">(275)</P>
</TD><TD valign=top width=15.867>&nbsp;</TD><TD valign=top width=10.8>&nbsp;</TD><TD valign=top width=59.733><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:13.85pt; font-family:Arial; font-size:9pt">(3,818)</P>
</TD><TD valign=top width=12.933>&nbsp;</TD><TD valign=top width=11.267>&nbsp;</TD><TD valign=top width=69.067><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:23.8pt; font-family:Arial; font-size:9pt">(528)</P>
</TD></TR>
<TR><TD valign=top width=252.333 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Change in inventories</P>
</TD><TD valign=top width=10.4>&nbsp;</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=65.133><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:22.45pt; font-family:Arial; font-size:9pt">1,332</P>
</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=12.133>&nbsp;</TD><TD valign=top width=62.4><P style="line-height:11pt; margin:0pt; padding-left:-5.55pt; padding-right:-62.85pt; text-indent:24.75pt; font-family:Arial; font-size:9pt">3,352</P>
</TD><TD valign=top width=15.867>&nbsp;</TD><TD valign=top width=10.8>&nbsp;</TD><TD valign=top width=59.733><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:19.85pt; font-family:Arial; font-size:9pt">2,413</P>
</TD><TD valign=top width=12.933>&nbsp;</TD><TD valign=top width=11.267>&nbsp;</TD><TD valign=top width=69.067><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:23.05pt; font-family:Arial; font-size:9pt">1,731</P>
</TD></TR>
<TR><TD valign=top width=252.333 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Other</P>
</TD><TD valign=top width=10.4>&nbsp;</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=65.133><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:29.2pt; font-family:Arial; font-size:9pt">539</P>
</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=12.133>&nbsp;</TD><TD valign=top width=62.4><P style="line-height:11pt; margin:0pt; padding-left:-5.55pt; padding-right:-62.85pt; text-indent:31.5pt; font-family:Arial; font-size:9pt">272</P>
</TD><TD valign=top width=15.867>&nbsp;</TD><TD valign=top width=10.8>&nbsp;</TD><TD valign=top width=59.733><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:19.85pt; font-family:Arial; font-size:9pt">1,375</P>
</TD><TD valign=top width=12.933>&nbsp;</TD><TD valign=top width=11.267>&nbsp;</TD><TD valign=top width=69.067><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:29.8pt; font-family:Arial; font-size:9pt">658</P>
</TD></TR>
<TR><TD style="border-bottom:1pt solid #000000" valign=top width=252.333 colspan=2><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Minority interest adjustment</P>
</TD><TD valign=top width=10.4>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=top width=11.2>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=top width=65.133><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:29.2pt; font-family:Arial; font-size:9pt">389</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=11.2>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=top width=12.133>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=top width=62.4><P style="line-height:11pt; margin:0pt; padding-left:-5.55pt; padding-right:-62.85pt; text-indent:25.5pt; font-family:Arial; font-size:9pt">(262)</P>
</TD><TD valign=top width=15.867>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=top width=10.8>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=top width=59.733><P style="line-height:11pt; margin:0pt; padding-right:-60.3pt; text-indent:24.5pt; font-family:Arial; font-size:9pt">343</P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=12.933>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=top width=11.267>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=top width=69.067><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:23.8pt; font-family:Arial; font-size:9pt">(604)</P>
</TD></TR>
<TR><TD valign=top width=191><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt"><B>Cash Operating Costs</B></P>
</TD><TD valign=top width=61.333><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt"><B>A</B></P>
</TD><TD valign=top width=10.4>&nbsp;</TD><TD valign=top width=11.2><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; font-family:Arial; font-size:9pt"><B>$</B></P>
</TD><TD valign=top width=65.133><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:22.45pt; font-family:Arial; font-size:9pt"><B>3,562</B></P>
</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=12.133><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; font-family:Arial; font-size:9pt"><B>$</B></P>
</TD><TD valign=top width=62.4><P style="line-height:11pt; margin:0pt; padding-left:-5.55pt; padding-right:-62.85pt; text-indent:20.25pt; font-family:Arial; font-size:9pt"><B>12,682</B></P>
</TD><TD valign=top width=15.867>&nbsp;</TD><TD valign=top width=10.8><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; font-family:Arial; font-size:9pt"><B>$</B></P>
</TD><TD valign=top width=59.733><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:16.6pt; font-family:Arial; font-size:9pt"><B>10,994</B></P>
</TD><TD valign=top width=12.933>&nbsp;</TD><TD valign=top width=11.267><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; font-family:Arial; font-size:9pt"><B>$</B></P>
</TD><TD valign=top width=69.067><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:18.6pt; font-family:Arial; font-size:9pt"><B>24,954</B></P>
</TD></TR>
<TR><TD valign=top width=191><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Add/(Subtract)</P>
</TD><TD valign=top width=61.333>&nbsp;</TD><TD valign=top width=10.4>&nbsp;</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=65.133><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=12.133>&nbsp;</TD><TD valign=top width=62.4><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=15.867><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=10.8><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=59.733><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=12.933><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=11.267><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=69.067><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=top width=191><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Depreciation and amortization</P>
</TD><TD valign=top width=61.333>&nbsp;</TD><TD valign=top width=10.4>&nbsp;</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=65.133><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:22.45pt; font-family:Arial; font-size:9pt">4,175</P>
</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=12.133>&nbsp;</TD><TD valign=top width=62.4><P style="line-height:11pt; margin:0pt; padding-left:-5.55pt; padding-right:-62.85pt; text-indent:24.75pt; font-family:Arial; font-size:9pt">2,415</P>
</TD><TD valign=top width=15.867><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=10.8><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=59.733><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:19.5pt; font-family:Arial; font-size:9pt">7,646</P>
</TD><TD valign=top width=12.933><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=11.267><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=69.067><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-3.6pt; text-indent:23.1pt; font-family:Arial; font-size:9pt">5,633</P>
</TD></TR>
<TR><TD valign=top width=191><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Asset retirement and reclamation</P>
</TD><TD valign=top width=61.333>&nbsp;</TD><TD valign=top width=10.4>&nbsp;</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=65.133><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:29.2pt; font-family:Arial; font-size:9pt">614</P>
</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=12.133>&nbsp;</TD><TD valign=top width=62.4><P style="line-height:11pt; margin:0pt; padding-left:-5.55pt; padding-right:-62.85pt; text-indent:31.5pt; font-family:Arial; font-size:9pt">412</P>
</TD><TD valign=top width=15.867><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=10.8><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=59.733><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:19.5pt; font-family:Arial; font-size:9pt">1,228</P>
</TD><TD valign=top width=12.933><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=11.267><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=69.067><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-3.6pt; text-indent:29.85pt; font-family:Arial; font-size:9pt">939</P>
</TD></TR>
<TR><TD valign=top width=191><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Change in inventories</P>
</TD><TD valign=top width=61.333>&nbsp;</TD><TD valign=top width=10.4>&nbsp;</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=65.133><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:27.7pt; font-family:Arial; font-size:9pt">(29)</P>
</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=12.133>&nbsp;</TD><TD valign=top width=62.4><P style="line-height:11pt; margin:0pt; padding-left:-5.55pt; padding-right:-62.85pt; text-indent:24.75pt; font-family:Arial; font-size:9pt">1,061</P>
</TD><TD valign=top width=15.867><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=10.8><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=59.733><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:26.25pt; font-family:Arial; font-size:9pt">337</P>
</TD><TD valign=top width=12.933><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=11.267><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=69.067><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-3.6pt; text-indent:23.1pt; font-family:Arial; font-size:9pt">1,061</P>
</TD></TR>
<TR><TD valign=top width=191><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Other</P>
</TD><TD valign=top width=61.333>&nbsp;</TD><TD valign=top width=10.4>&nbsp;</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=65.133><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:23.2pt; font-family:Arial; font-size:9pt">(173)</P>
</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=12.133>&nbsp;</TD><TD valign=top width=62.4><P style="line-height:11pt; margin:0pt; padding-left:-5.55pt; padding-right:-62.85pt; text-indent:36pt; font-family:Arial; font-size:9pt">95</P>
</TD><TD valign=top width=15.867><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=10.8><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=59.733><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:24.75pt; font-family:Arial; font-size:9pt">(65)</P>
</TD><TD valign=top width=12.933><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=11.267><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=69.067><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-3.6pt; text-indent:34.35pt; font-family:Arial; font-size:9pt">80</P>
</TD></TR>
<TR><TD style="border-bottom:0.5pt solid #000000" valign=top width=191><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt">Minority interest adjustment</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=61.333>&nbsp;</TD><TD valign=top width=10.4>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=11.2>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=65.133><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:23.2pt; font-family:Arial; font-size:9pt">(145)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=11.2>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12.133>&nbsp;</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=62.4><P style="line-height:11pt; margin:0pt; padding-left:-5.55pt; padding-right:-62.85pt; text-indent:25.5pt; font-family:Arial; font-size:9pt">(159)</P>
</TD><TD valign=top width=15.867><P style="margin:0pt"><BR></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=10.8><P style="margin:0pt"><BR></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=59.733><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:21.05pt; font-family:Arial; font-size:9pt">(302)</P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=12.933><P style="margin:0pt"><BR></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=11.267><P style="margin:0pt"><BR></P>
</TD><TD style="border-bottom:0.5pt solid #000000" valign=top width=69.067><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-3.6pt; text-indent:23.85pt; font-family:Arial; font-size:9pt">(321)</P>
</TD></TR>
<TR><TD valign=top width=191><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt"><B>Production Costs</B></P>
</TD><TD valign=top width=61.333><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt"><B>B</B></P>
</TD><TD valign=top width=10.4>&nbsp;</TD><TD valign=top width=11.2><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; font-family:Arial; font-size:9pt"><B>$</B></P>
</TD><TD valign=top width=65.133><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:22.45pt; font-family:Arial; font-size:9pt"><B>8,004</B></P>
</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=12.133><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; font-family:Arial; font-size:9pt"><B>$</B></P>
</TD><TD valign=top width=62.4><P style="line-height:11pt; margin:0pt; padding-left:-5.55pt; padding-right:-62.85pt; text-indent:20.25pt; font-family:Arial; font-size:9pt"><B>16,506</B></P>
</TD><TD valign=top width=15.867>&nbsp;</TD><TD valign=top width=10.8><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; font-family:Arial; font-size:9pt"><B>$</B></P>
</TD><TD valign=top width=59.733><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:16.5pt; font-family:Arial; font-size:9pt"><B>19,838</B></P>
</TD><TD valign=top width=12.933>&nbsp;</TD><TD valign=top width=11.267><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; font-family:Arial; font-size:9pt"><B>$</B></P>
</TD><TD valign=top width=69.067><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-3.6pt; text-indent:18.6pt; font-family:Arial; font-size:9pt"><B>32,346</B></P>
</TD></TR>
<TR><TD valign=top width=191>&nbsp;</TD><TD valign=top width=61.333>&nbsp;</TD><TD valign=top width=10.4>&nbsp;</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=65.133><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=11.2>&nbsp;</TD><TD valign=top width=12.133>&nbsp;</TD><TD valign=top width=62.4><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=15.867><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=10.8><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=59.733><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=12.933><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=11.267><P style="margin:0pt"><BR></P>
</TD><TD valign=top width=69.067><P style="margin:0pt"><BR></P>
</TD></TR>
<TR><TD valign=top width=191><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt"><B>Payable Ounces of Silver</B></P>
</TD><TD valign=top width=61.333><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt"><B>C</B></P>
</TD><TD valign=top width=10.4>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=top width=11.2>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=top width=65.133><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:6.7pt; font-family:Arial; font-size:9pt"><B>3,048,131</B></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=11.2>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=top width=12.133>&nbsp;</TD><TD style="border-bottom:1pt solid #000000" valign=top width=62.4><P style="line-height:11pt; margin:0pt; padding-left:-5.55pt; padding-right:-62.85pt; text-indent:9pt; font-family:Arial; font-size:9pt"><B>2,831,511</B></P>
</TD><TD valign=top width=15.867><P style="margin:0pt"><BR></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=10.8><P style="margin:0pt"><BR></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=59.733><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; text-indent:5.25pt; font-family:Arial; font-size:9pt"><B>6,079,589</B></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=12.933><P style="margin:0pt"><BR></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=11.267><P style="margin:0pt"><BR></P>
</TD><TD style="border-bottom:1pt solid #000000" valign=top width=69.067><P style="line-height:11pt; margin:0pt; padding-right:-2.9pt; text-indent:5.2pt; font-family:Arial; font-size:9pt"><B>5,549,584</B></P>
</TD></TR>
<TR><TD valign=top width=191><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt"><B>Total Cash Cost per Ounce</B></P>
</TD><TD valign=top width=61.333><P style="line-height:10.5pt; margin:0pt; font-family:Arial; font-size:8.5pt">(A*1000)/C</P>
</TD><TD valign=top width=10.4>&nbsp;</TD><TD style="background-color:#E0E0E0; border-left:1pt solid #000000; border-bottom:1pt solid #000000" valign=top width=11.2><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; font-family:Arial; font-size:9pt"><B>$</B></P>
</TD><TD style="background-color:#E0E0E0; border-bottom:1pt solid #000000" valign=top width=65.133><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:1.7pt; font-family:Arial; font-size:9pt"><B>1.17</B></P>
</TD><TD style="background-color:#E0E0E0; border-bottom:1pt solid #000000" valign=top width=11.2>&nbsp;</TD><TD style="background-color:#E0E0E0; border-bottom:1pt solid #000000" valign=top width=12.133><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; font-family:Arial; font-size:9pt"><B>$</B></P>
</TD><TD style="background-color:#E0E0E0; border-bottom:1pt solid #000000" valign=top width=62.4><P style="line-height:11pt; margin:0pt; padding-left:-5.55pt; padding-right:3.6pt; font-family:Arial; font-size:9pt"><B>4.48</B></P>
</TD><TD style="background-color:#E0E0E0" valign=top width=15.867>&nbsp;</TD><TD style="background-color:#E0E0E0; border-bottom:1pt solid #000000" valign=top width=10.8><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; font-family:Arial; font-size:9pt"><B>$</B></P>
</TD><TD style="background-color:#E0E0E0; border-bottom:1pt solid #000000" valign=top width=59.733><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-1.45pt; font-family:Arial; font-size:9pt"><B>1.81</B></P>
</TD><TD style="background-color:#E0E0E0; border-bottom:1pt solid #000000" valign=top width=12.933>&nbsp;</TD><TD style="background-color:#E0E0E0; border-bottom:1pt solid #000000" valign=top width=11.267><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; font-family:Arial; font-size:9pt"><B>$</B></P>
</TD><TD style="background-color:#E0E0E0; border-right:1pt solid #000000; border-bottom:1pt solid #000000" valign=top width=69.067><P style="line-height:11pt; margin:0pt; padding-left:-1.75pt; padding-right:4.1pt; font-family:Arial; font-size:9pt"><B>4.50</B></P>
</TD></TR>
<TR><TD valign=top width=191><P style="line-height:11pt; margin:0pt; font-family:Arial; font-size:9pt"><B>Total Production Costs per Ounce</B></P>
</TD><TD valign=top width=61.333><P style="line-height:10.5pt; margin:0pt; font-family:Arial; font-size:8.5pt">(B*1000)/C</P>
</TD><TD valign=top width=10.4>&nbsp;</TD><TD style="background-color:#E0E0E0; border-left:1pt solid #000000; border-bottom:1pt solid #000000" valign=top width=11.2><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; font-family:Arial; font-size:9pt"><B>$</B></P>
</TD><TD style="background-color:#E0E0E0; border-bottom:1pt solid #000000" valign=top width=65.133><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:1.7pt; font-family:Arial; font-size:9pt"><B>2.63</B></P>
</TD><TD style="background-color:#E0E0E0; border-bottom:1pt solid #000000" valign=top width=11.2>&nbsp;</TD><TD style="background-color:#E0E0E0; border-bottom:1pt solid #000000" valign=top width=12.133><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; font-family:Arial; font-size:9pt"><B>$</B></P>
</TD><TD style="background-color:#E0E0E0; border-bottom:1pt solid #000000" valign=top width=62.4><P style="line-height:11pt; margin:0pt; padding-left:-5.55pt; padding-right:3.6pt; font-family:Arial; font-size:9pt"><B>5.83</B></P>
</TD><TD style="background-color:#E0E0E0" valign=top width=15.867>&nbsp;</TD><TD style="background-color:#E0E0E0; border-bottom:1pt solid #000000" valign=top width=10.8><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; font-family:Arial; font-size:9pt"><B>$</B></P>
</TD><TD style="background-color:#E0E0E0; border-bottom:1pt solid #000000" valign=top width=59.733><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-1.45pt; font-family:Arial; font-size:9pt"><B>3.26</B></P>
</TD><TD style="background-color:#E0E0E0; border-bottom:1pt solid #000000" valign=top width=12.933>&nbsp;</TD><TD style="background-color:#E0E0E0; border-bottom:1pt solid #000000" valign=top width=11.267><P style="line-height:11pt; margin:0pt; padding-left:-2.1pt; padding-right:-60.3pt; font-family:Arial; font-size:9pt"><B>$</B></P>
</TD><TD style="background-color:#E0E0E0; border-right:1pt solid #000000; border-bottom:1pt solid #000000" valign=top width=69.067><P style="line-height:11pt; margin:0pt; padding-left:-1.75pt; padding-right:4.1pt; font-family:Arial; font-size:9pt"><B>5.83</B></P>
</TD></TR>
</TABLE>
<P style="margin:0pt"><BR></P>
<P style="line-height:13pt; margin-top:16.5pt; margin-bottom:11pt; font-family:Arial; font-size:11pt"><B>Liquidity and Capital Resources</B></P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify>At June 30, 2006, cash and cash equivalents plus short-term investments were $185.3 million, a $136.7 million increase from March 31, 2006. &nbsp;The increase is primarily due to the net proceeds of $142.2 million from the offering of common shares completed during the quarter. &nbsp;In addition to these funds, the Company also generated cash flow from operating activities of $29.2 million during the quarter and drew a further $2.2 million as an advance on concentrate shipments. &nbsp;Of the $173.8 million that was raised and generated, $37 million was invested in mining equipment and development, primarily at the Company&#146;s two construction projects, Alamo Dorado and Manantial Espejo, where $18.2 million and $10.1 million was expended respectively. &nbsp;Significant investments also occurred at Morococha, where $3.2 million was invested in mine development and at La Colorada, where $1.7 milli
on was invested in rehabilitating the sulphide plant in preparation for its restart. &nbsp;The balance of the funds raised and generated during the quarter were invested in the Company&#146;s high-quality bond portfolio ($116.3 million) and held in cash ($20.4 million).</P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify>Working capital at June 30, 2006 was $188.9 million, an increase of $125.8 million from March 31, 2006. &nbsp;The increase in working capital resulted from a $136.7 million increase in cash and short-term investments plus a $5.6 million increase in accounts receivable, and an increase of $3.9 million in other current assets, partially offset by a $20.4 million increase in current liabilities. &nbsp;The increase in current liabilities was primarily a consequence of increases in payables related to Peruvian income taxes, construction activities at Alamo Dorado and advances on concentrate shipments.</P>
<P style="margin-top:0pt; margin-bottom:11pt" align=justify><BR>
<BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">30</P>
<P style="margin:0pt"><BR></P>
<P style="margin:0pt"><BR></P>
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<P style="margin:0pt"><BR></P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify>Shareholders&#146; equity at June 30, 2006 amounted to $463 million, an increase of $205.6 million from shareholders&#146; equity at March 31, 2006. This increase resulted primarily from the public offering of common shares, from the acquisition of the remaining 50 per cent interest of Manantial Espejo, valued at $47.4 million, and from the net income generated during the second quarter of $15 million. &nbsp;At June 30, 2006, the Company had 76 million common shares issued and outstanding. &nbsp;</P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify>Based on the Company&#146;s financial position at June 30, 2006 and the operating cash flows that are expected over the next twelve months, management believes that the Company&#146;s liquid assets are more than sufficient to fund the development of Alamo Dorado and Manantial Espejo, and planned sustaining capital expenditures, and to discharge liabilities as they come due. At the date of this MD&amp;A, the Company did not have any material contractual obligation, or any off-balance sheet arrangements, except for $9.8 million of commitments relating to the construction of Alamo Dorado and Manantial Espejo.</P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify>In anticipation of capital expenditures in Mexican pesos (&#147;MXN&#148;) relating to the construction of Alamo Dorado, and to match anticipated spending, the Company has purchased MXN 43 million settling between July 2006 and September 2006 at an average MXN/US$ exchange rate of 10.86. At June 30, 2006, the mark to market value of the Company&#146;s position was loss of $0.2 million. &nbsp;</P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify>As at June 30, 2006, the Company had sold forward 6,000 tonnes of zinc at an average price of $1,603 per tonne and had bought forward 6,000 tonnes of zinc at an average of $2,986 per tonne. &nbsp;All of the Company&#146;s zinc positions settle between July and December of 2006. &nbsp;At June 30, 2006, the cash offered price of zinc was $3,218 per tonne, which resulted in a net unrealized mark-to-market loss of the Company&#146;s zinc forward positions of $8.3 million ($9.5 million of unrealized losses and $1.2 million of unrealized gains).</P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify>At the end of the second quarter of 2006, the Company had fixed the price of 900,000 ounces of silver produced during the second quarter and contained in concentrates, which are due to be priced in July and August of 2006 under the Company&#146;s concentrate contracts. &nbsp;The price fixed for these ounces averaged $12.14 per ounce while the spot price of silver was $10.70 on June 30, 2006, resulting in a mark to market gain of $1.3 million.</P>
<P style="line-height:13pt; margin-top:16.5pt; margin-bottom:11pt; font-family:Arial; font-size:11pt"><B>Exploration and Development Activities</B></P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify>The development of the Company&#146;s Alamo Dorado project in Mexico is progressing on budget and on schedule with production still planned for the start of the fourth quarter of 2006. &nbsp;Over 82 per cent of the construction work was completed by quarter end. &nbsp;The expected total capital costs for the project are approximately $77 million, including start-up working capital and a contingency allowance. </P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify>Construction of the Manantial Espejo project in Argentina, which commenced in April 2006, is progressing well. &nbsp;Expenditures at the project during the second quarter were $10.1 million, primarily on purchasing the necessary underground and surface mining equipment. &nbsp;The Company continued to fill key staffing positions during the quarter and has awarded the critical EPCM contract to Ausenco International, through its Argentinean subsidiary. &nbsp;Over the remainder of the year, the Company anticipates spending an additional $36 million on the construction of Manantial Espejo, which will be </P>
<P style="margin-top:0pt; margin-bottom:11pt" align=justify><BR>
<BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">31</P>
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<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify>funded out of the proceeds from the common share offering completed in the second quarter. &nbsp;Capital costs for the project are expected to be $112.3 million including working capital and normal construction contingencies, plus $18.1 million in Argentine Value Added Tax which will be refundable once the mine is in production. &nbsp;</P>
<P style="line-height:13pt; margin-top:0pt; margin-bottom:11pt; font-family:Arial; font-size:11pt" align=justify>At the San Vicente property, Pan American is hoping to continue to mine on a limited scale while evaluating expansion plans. &nbsp;The Company signed an extension to an a previous agreement with Comibol, a Bolivian state run mining company, on July 25, 2006, which allows the Company to continuing with mining activities. &nbsp;The Company plans to resume processing ore at a nearby processing facility in early August, 2006 and expects to produce approximately 0.2 million ounces from San Vicente in 2006 at a total cost of under $3.50 per ounce. &nbsp;</P>
<P style="margin-top:0pt; margin-bottom:11pt" align=justify><BR>
<BR></P>
<P style="line-height:14pt; margin:0pt; font-family:Arial; font-size:12pt" align="center">32</P>
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