<SEC-DOCUMENT>0001279569-13-001704.txt : 20131219
<SEC-HEADER>0001279569-13-001704.hdr.sgml : 20131219
<ACCEPTANCE-DATETIME>20131219121042
ACCESSION NUMBER:		0001279569-13-001704
CONFORMED SUBMISSION TYPE:	6-K
PUBLIC DOCUMENT COUNT:		2
CONFORMED PERIOD OF REPORT:	20131218
FILED AS OF DATE:		20131219
DATE AS OF CHANGE:		20131219

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:		131287646

	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>panamericansilver6k.htm
<DESCRIPTION>FORM 6-K
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 14pt Times New Roman, Times, Serif"><B>UNITED
STATES</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 14pt Times New Roman, Times, Serif"><B>SECURITIES
AND EXCHANGE COMMISSION</B></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 12pt Times New Roman, Times, Serif"><B>Washington,
D.C. 20549</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>__________________</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 18pt Times New Roman, Times, Serif"><B>FORM
6-K&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">_____________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>REPORT OF FOREIGN PRIVATE ISSUER</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>PURSUANT TO RULE 13a-16 OR 15d-16</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>UNDER THE SECURITIES EXCHANGE ACT of 1934</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>December 18, 2013</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">_____________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 18pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font: 24pt Times New Roman, Times, Serif"><B>Pan
American Silver Corp.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">(Exact name of registrant as specified in its
charter)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 18pt"><B>&nbsp;</B></FONT><B><FONT STYLE="font-size: 10pt">1500-625
HOWE STREET</FONT></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>VANCOUVER BC CANADA V6C 2T6</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">(Address of principal executive offices)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 18pt"><B>&nbsp;</B></FONT><B><FONT STYLE="font-size: 10pt">000-13727</FONT></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">(Commission File Number)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">_____________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Indicate by check mark whether the registrant files or will file
annual reports under cover Form 20-F or Form 40-F.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE ALIGN="CENTER" CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; background-color: white">
<TR>
    <TD STYLE="width: 29%; text-align: right">&nbsp;Form 20-F</TD>
    <TD STYLE="width: 21%; text-align: center">&nbsp;<FONT STYLE="font-family: Wingdings 2">&#163;</FONT></TD>
    <TD STYLE="width: 25%; text-align: center">&nbsp;Form 40-F</TD>
    <TD STYLE="width: 25%"><FONT STYLE="font-family: Wingdings 2">&#83;</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">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). _____</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE ALIGN="CENTER" CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; background-color: white">
<TR>
    <TD STYLE="width: 3%"></TD>
    <TD STYLE="width: 97%;"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Note: Regulation S-T Rule
    101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security
    holders.</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">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): ____</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE ALIGN="CENTER" CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; background-color: white">
<TR>
    <TD STYLE="width: 3%"></TD>
    <TD STYLE="width: 97%">Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a
    Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make
    public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant&rsquo;s
    &ldquo;home country&rdquo;), or under the rules of the home country exchange on which the registrant&rsquo;s securities are
    traded, as long as the report or other document is not a press release, is not required to be and has not been distributed
    to the registrant&rsquo;s security holders, and, if discussing a material event, has already been the subject of a Form 6-K
    submission or other Commission filing on EDGAR.</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Indicate by check mark whether by furnishing the information contained
in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the
Securities Exchange Act of 1934.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE ALIGN="CENTER" CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; background-color: white">
<TR>
    <TD STYLE="width: 29%; text-align: right">&nbsp;Yes</TD>
    <TD STYLE="width: 21%; text-align: center"><FONT STYLE="font-family: Wingdings 2">&#163;</FONT></TD>
    <TD STYLE="width: 25%; text-align: center">&nbsp;No</TD>
    <TD STYLE="width: 25%"><FONT STYLE="font-family: Wingdings 2">&#83;</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">If &quot;Yes&quot; is marked, indicate below the file number assigned
to the registrant in connection with Rule 12g3-2(b):&nbsp;<B>______</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Signatures&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

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    <TD STYLE="width: 50%"></TD>
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    <TD STYLE="width: 49%"></TD></TR>
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    <TD></TD>
    <TD COLSPAN="2" STYLE="font-weight: bold"><B>Pan American Silver Corp.</B></TD></TR>
<TR STYLE="vertical-align: top">
    <TD></TD>
    <TD COLSPAN="2">(Registrant)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>Date: December  18, 2013</TD>
    <TD>By:&nbsp;&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">/s/&nbsp;<B><I>ROBERT PIROOZ</I></B></TD></TR>
<TR STYLE="vertical-align: top">
    <TD COLSPAN="2"></TD>
    <TD>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Robert Pirooz</P></TD></TR>
<TR STYLE="vertical-align: top">
    <TD COLSPAN="2"></TD>
    <TD STYLE="font-style: italic">General Counsel</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>EXHIBIT LIST</B></P>

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    <TD STYLE="width: 8%; border-bottom: black 1pt solid">Exhibit</TD>
    <TD STYLE="width: 4%; padding-bottom: 0.75pt"></TD>
    <TD STYLE="border-bottom: black 1pt solid">Description</TD></TR>
<TR>
    <TD></TD>
    <TD></TD>
    <TD></TD></TR>
<TR>
    <TD STYLE="vertical-align: top; text-align: center">&nbsp;&nbsp;99.1</TD>
    <TD></TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">News Release dated December 18, 2013 - Pan American Silver to Expand its La Colorada mine</FONT></TD></TR></TABLE>

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<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>2
<FILENAME>ex991.htm
<DESCRIPTION>NEWS RELEASE DATED DECEMBER 18, 2013
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<P STYLE="margin: 0; text-align: right"><FONT STYLE="font: 8pt Arial, Helvetica, Sans-Serif"><B>Exhibit 99.1</B></FONT></P>

<P STYLE="margin: 0; text-align: right"><FONT STYLE="font: 8pt Arial, Helvetica, Sans-Serif">&nbsp;</FONT></P>

<P STYLE="margin: 0; text-align: right"><FONT STYLE="font: 8pt Arial, Helvetica, Sans-Serif"></FONT></P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0"><B>Pan American Silver to Expand its La Colorada mine</B></P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0"><B>(All Amounts Expressed in US$ Unless Otherwise Stated)</B></P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0">VANCOUVER, Dec. 18, 2013 /CNW/ - <B>Pan American Silver Corp.
(NASDAQ: PAAS) (TSX: PAA) </B>(&quot;Pan American&quot; or the &quot;Company&quot;) has decided to proceed with the expansion of
its La Colorada mine in Zacatecas, Mexico, based on the positive results of a recently completed Preliminary Economic Assessment
(the &quot;PEA&quot; or the &quot;Assessment&quot;).&nbsp; The PEA demonstrates that the relatively low-risk expansion project
has the potential to provide robust after-tax economic returns using a $19 per ounce long-term silver price. The PEA contemplates
an increase in silver production from the current level of approximately 4.7 million ounces per year to 7.7 million ounces per
year by the end of 2017, for an incremental capital investment of $80 million, the majority of which will be spent over the next
3 years.</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0"><B>PEA Project Highlights*</B></P>

<table cellpadding="0" style="width: 100%">
<tr>
    <td style="border: black 1pt solid; padding: 1.5pt">
        <P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0 0 0 22.5pt; text-indent: -0.25in"><font style="font: 10pt Symbol">&#183;</font><font style="font: 7pt Times New Roman, Times, Serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
        </font><font style="font: 10pt Arial, Helvetica, Sans-Serif">64% increase in estimated annual silver production from current 4.7
        million ounces forecast for 2013, to 7.7 million ounces in 2018 when the full expansion Project is completed </font></P>
        <P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0 0 0 22.5pt; text-indent: -0.25in"><font style="font: 10pt Symbol">&#183;</font><font style="font: 7pt Times New Roman, Times, Serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
        </font><font style="font: 10pt Arial, Helvetica, Sans-Serif">39% reduction in estimated cash costs from $10.00 forecast for 2013,
        to $6.10 per ounce of silver, net of by-product credits in 2018 </font></P>
        <P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0 0 0 22.5pt; text-indent: -0.25in"><font style="font: 10pt Symbol">&#183;</font><font style="font: 7pt Times New Roman, Times, Serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
        </font><font style="font: 10pt Arial, Helvetica, Sans-Serif">Increase mining and processing rates from current 1,250 tpd to an
        estimated 1,500 tpd by mid-2016 and to 1,800 tpd by the end of 2017 </font></P>
        <P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0 0 0 22.5pt; text-indent: -0.25in"><font style="font: 10pt Symbol">&#183;</font><font style="font: 7pt Times New Roman, Times, Serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
        </font><font style="font: 10pt Arial, Helvetica, Sans-Serif">Installation of a new 600-metre deep shaft and hoist between the Candelaria
        and Estrella mining zones </font></P>
        <P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0 0 0 22.5pt; text-indent: -0.25in"><font style="font: 10pt Symbol">&#183;</font><font style="font: 7pt Times New Roman, Times, Serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
        </font><font style="font: 10pt Arial, Helvetica, Sans-Serif">Expansion and upgrade of the current sulphide processing plant </font></P>
        <P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0 0 0 22.5pt; text-indent: -0.25in"><font style="font: 10pt Symbol">&#183;</font><font style="font: 7pt Times New Roman, Times, Serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
        </font><font style="font: 10pt Arial, Helvetica, Sans-Serif">An estimated minimum project mine life of 10 years at increased capacity,
        based on mid-year 2013 reserves and resources estimate </font></P>
        <P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0 0 0 22.5pt; text-indent: -0.25in"><font style="font: 10pt Symbol">&#183;</font><font style="font: 7pt Times New Roman, Times, Serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
        </font><font style="font: 10pt Arial, Helvetica, Sans-Serif">Incremental expansion capital estimated to be $80 million, the majority
        of which will be spent over the next 3 years </font></P>
        <P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0 0 0 22.5pt; text-indent: -0.25in"><font style="font: 10pt Symbol">&#183;</font><font style="font: 7pt Times New Roman, Times, Serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
        </font><font style="font: 10pt Arial, Helvetica, Sans-Serif">Assuming a $19/oz silver price, the estimated after-tax net present
        value (NPV**) of the incremental cash flow at a 10% discount is $38.6 million, with an internal rate of return (IRR) estimated
        at 22% and a capital payback period of 2.5 years. At a $25/oz silver price, the estimated 10% NPV increases to $71.7 million, the
        estimated IRR jumps to 32% and the payback period is reduced to 2.0 years </font></P>
        <P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0 0 0 22.5pt; text-indent: -0.25in"><font style="font: 10pt Symbol">&#183;</font><font style="font: 7pt Times New Roman, Times, Serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
        </font><font style="font: 10pt Arial, Helvetica, Sans-Serif">Additional exploration success at La Colorada could meaningfully increase
        the economic potential of an expanded operation </font></P></td></tr>
</table>
<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<table cellpadding="0" style="width: 100%">
<tr>
    <td style="padding: 1.5pt; font: 10pt Times New Roman, Times, Serif"><font style="font: 10pt Arial, Helvetica, Sans-Serif">* Prices assumed are $19.00 per Ag oz, $1,200 per Au oz, $1,850 per tonne Zn, $2,100 per tonne Pb and $7,000 per tonne Cu. The PEA is based on La Colorada's estimated mineral reserves and resources as of December 31, 2012.&nbsp; The PEA is preliminary in nature and includes the use of inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. Thus, there is no certainty that the PEA will be realized. Actual results may vary, perhaps materially. Mineral resources that are not mineral reserves have no demonstrated economic viability.</font><br>
<font style="font: 10pt Arial, Helvetica, Sans-Serif">** The NPV is calculated based on the differential cash flow from expanding the mine versus status quo operation, over the next 10 years. </font></td></tr>
</table>
<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0">Commenting on the La Colorada expansion project, Geoff Burns,
President &amp; CEO of Pan American said, &quot;We have had exceptional exploration success at La Colorada and have grown the mine's
reserves and resources considerably.&quot;&nbsp; Burns continued, &quot;La Colorada has become a core long-term asset for the Company
and we are pleased to be able to turn this exploration success into an organic expansion project with considerable economic potential.&nbsp;
Even at today's silver price, it makes sense to invest a relatively modest amount of capital to significantly increase our low-cost
silver production at this high-grade and long-life asset.&nbsp; This is a low-risk project, at one of our best-performing and most
stable mines, which we can comfortably finance with our internal resources.&nbsp; I am very pleased that our Board of Directors
has unanimously decided to transform La Colorada into our largest silver producer and I look forward to fully realizing La Colorada's
potential.&quot;&nbsp;&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0"><B>Scope of the Expansion Project </B></P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0">La Colorada's expansion project will be built progressively,
ramping up from the current mining and processing rates of 1,250 tpd to 1,800 tpd by the end of 2017.&nbsp; Once the expansion
is complete, La Colorada's annual production capacity is estimated to grow 64% to approximately 7.7 million ounces of silver in
2018.</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0">The mine's expansion will be achieved through the construction
of new mining infrastructure, the development of new mining zones to reach deeper, higher-grade areas of mineralization and the
expansion of the sulphide ore processing plant.&nbsp; A new 600-metre deep shaft will be constructed between the main Candelaria
area that contains the NC2 and HW veins, and the Estrella area that contains the Amolillo vein, utilizing a highly efficient raise
boring technique.&nbsp; The new shaft, which over the long term would be required whether or not we had decided to proceed with
the expansion, will increase hoisting capacity to 2,300 tpd, accommodating ore and waste extraction as well as serving as the main
access to working areas for mine personnel and materials.&nbsp; Preliminary engineering work for the new shaft and hoist has already
been conducted and detailed engineering will begin in early 2014. Construction of the new shaft is scheduled to start early in
2015, following completion of sufficient underground development around the shaft bottom, and is expected to be commissioned in
the later part of 2016. The new shaft will allow for increased underground development rates to access additional mining areas,
allowing production rates to rise.&nbsp; The shaft and associated hoisting equipment will be designed such that it can be deepened
in the future if justified by future exploration success.</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0">Mining at both the Estrella and Candelaria areas will continue
utilizing the cut-and-fill methods currently being successfully employed.&nbsp; The capacity of the ventilation and dewatering
systems will be increased to handle the mine's hot and wet ground conditions as mining operations extend at depth. The expansion
plan also includes the addition of 22 new pieces of mining equipment to the fleet and the hiring of over 100 additional mining
personnel.</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0">Total throughput at La Colorada's processing plants will progressively
increase from today's 1,250 tpd to 1,800 tpd by 2018.&nbsp; The mine currently produces dor&eacute; bars from a conventional cyanide
leach plant for the oxide ore, and silver-rich lead and zinc concentrates from a floatation plant that treats the sulphide ore.&nbsp;
Both circuits currently share a single crushing plant.&nbsp; While the oxide plant will not be modified due to La Colorada's oxide
production remaining at current levels for the rest of the mine's life, the sulphide plant will be expanded to treat the increased
sulphide ore feed.</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0">Expansion of the sulphide plant to 1,500 tpd will be implemented
through the installation of a new crusher and grinding mill.&nbsp; The existing zinc flotation cells will be converted to lead
floatation and a new zinc floatation circuit will be built.&nbsp; The plan also includes an upgrade and expansion of the plant's
dewatering circuits and installation of a new 115 kV power line connection to the national grid replacing the existing 33 kV lines.&nbsp;
Work on the plant's expansion will commence in early 2015 and is scheduled to be completed by mid-2016.</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0">The Company's decision to expand the La Colorada mine as described
herein is not based on a feasibility study of mineral reserves demonstrating economic and technical viability and as such may be
subject to increased uncertainty and risks.</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0"><B>Estimated Capital Expenditures</B></P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0">The total incremental expansion capital over the next 4 years
has been estimated at $80 million, the majority of which will be spent from 2014 to 2016.&nbsp; The suphide plant expansion, additional
mining equipment and accelerated development, plus several important infrastructure upgrades account for the largest portion of
the incremental capital for the project.&nbsp; The Company expects that the expansion project can be completed without materially
disrupting the current operation or ongoing exploration efforts.</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0">Total capital to be invested at La Colorada over the next
four years is estimated at $163.8 million (excluding exploration), for both ongoing operations and the expansion project, as shown
in the following table:</P>

<table cellspacing="0" cellpadding="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr>
    <td style="border: black 1pt solid; padding: 1.5pt"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>Area ($ Million)</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: center"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>2014</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: center"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>2015</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: center"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>2016</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: center"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>2017</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: center"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>2014-2017</b></font><br>
<font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>LOM + </b></font><br>
<font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>Expansion </b></font><br>
<font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>Capital</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: center"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>2014-2017 </b></font><br>
<font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>Expansion</b></font><br>
<font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>Capital </b></font><br>
<font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>Only</b> </font></td></tr>
<tr>
    <td colspan="6" style="border: black 1pt solid; padding: 1.5pt"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>Major Projects</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right">&nbsp;</td></tr>
<tr>
    <td style="border: black 1pt solid; padding: 1.5pt"><font style="font: 10pt Arial, Helvetica, Sans-Serif">Shaft &amp; Hoist Installation </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$8.8 </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$23.0 </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$8.5 </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">- </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$40.3</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>-</b> </font></td></tr>
<tr>
    <td style="border: black 1pt solid; padding: 1.5pt"><font style="font: 10pt Arial, Helvetica, Sans-Serif">Plant Expansion </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$3.6 </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$33.6 </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$8.7 </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">- </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$46.0</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$46.0</b> </font></td></tr>
<tr>
    <td style="border: black 1pt solid; padding: 1.5pt"><font style="font: 10pt Arial, Helvetica, Sans-Serif">Infrastructure Upgrades </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$6.5 </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$9.4 </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$0.1 </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">- </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$16.1</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$11.9</b> </font></td></tr>
<tr>
    <td style="border: black 1pt solid; padding: 1.5pt"><font style="font: 10pt Arial, Helvetica, Sans-Serif">Underground Development </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$2.0 </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$2.6 </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$2.1 </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$1.7 </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$8.4</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$4.8</b> </font></td></tr>
<tr>
    <td style="border: black 1pt solid; padding: 1.5pt"><font style="font: 10pt Arial, Helvetica, Sans-Serif">Additional Mine Equipment </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">- </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$4.1 </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">- </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$4.1 </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$8.3</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$8.3</b> </font></td></tr>
<tr>
    <td style="border: black 1pt solid; padding: 1.5pt"><font style="font: 10pt Arial, Helvetica, Sans-Serif">Initial Sulphide Tailings Expansion </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$5.0 </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">- </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">- </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">- </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$5.0</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>-</b> </font></td></tr>
<tr>
    <td style="border: black 1pt solid; padding: 1.5pt"><font style="font: 10pt Arial, Helvetica, Sans-Serif">Project Indirects </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$2.3 </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$5.8 </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$4.9 </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">- </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$12.9</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$5.2</b> </font></td></tr>
<tr>
    <td style="border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>Sub Total Projects</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$28.2</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$78.6</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$24.4</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$5.8</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$137.0</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$76.1</b> </font></td></tr>
<tr>
    <td colspan="6" style="border: black 1pt solid; padding: 1.5pt"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>Other Capital</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right">&nbsp;</td></tr>
<tr>
    <td style="border: black 1pt solid; padding: 1.5pt"><font style="font: 10pt Arial, Helvetica, Sans-Serif">Normal Mine and Plant Sustaining Capital </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$5.8 </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$3.8 </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$5.2 </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$5.5 </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$20.3</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>($0.3)</b> </font></td></tr>
<tr>
    <td style="border: black 1pt solid; padding: 1.5pt"><font style="font: 10pt Arial, Helvetica, Sans-Serif">Ongoing Tailings Dam Expansions </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">- </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">- </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">- </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$6.6 </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$6.6</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$4.2</b> </font></td></tr>
<tr>
    <td style="border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>Sub-total Other Capital</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$5.8</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$3.8</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$5.2</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$12.1</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$26.9</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$3.9</b> </font></td></tr>
<tr>
    <td style="border: black 1pt solid; padding: 1.5pt"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>Total Capital</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$34.0</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$82.3</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$29.6</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$17.9</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$163.8</b> </font></td>
    <td style="vertical-align: top; border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>$80.0</b> </font></td></tr>
</table>
<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0"><B>Economic Highlights</B></P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0">The PEA for the La Colorada expansion demonstrates that the
project has the potential to be robust at current prices.&nbsp; Assuming a long term silver price of $19 per ounce, and prices
of $1,850 per tonne of zinc and $2,100 per tonne of lead, the expanded mine has the potential to generate estimated net revenues
of $1.4 billion and after tax, undiscounted net cash flow of $372 million over the next 10-years 2014 through 2023, including the
new Mexican mining taxes.&nbsp; The PEA estimates an after tax net present value of $38.6 million at a 10% discount rate, an estimated
IRR of 22% and an estimated payback period of 2.5 years.&nbsp; Using a long term silver price assumption of $25 per ounce, the
expansion project's economic potential becomes even more attractive with an estimated NPV of $71.7 million at a 10% discount rate,
an estimated IRR of 32% and an estimated payback period of 2 years as shown in the following table:</P>

<table cellspacing="0" cellpadding="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: top">
    <td style="border: black 1pt solid; padding: 1.5pt"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>Cash Flow 2014-2023</b> </font></td>
    <td style="border: black 1pt solid; padding: 1.5pt; text-align: center"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>Ag$19/oz</b> </font></td>
    <td style="border: black 1pt solid; padding: 1.5pt; text-align: center"><font style="font: 10pt Arial, Helvetica, Sans-Serif"><b>Ag $25/oz</b> </font></td></tr>
<tr style="vertical-align: top">
    <td style="border: black 1pt solid; padding: 1.5pt"><font style="font: 10pt Arial, Helvetica, Sans-Serif">Net Revenue* </font></td>
    <td style="border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$1.4B </font></td>
    <td style="border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$1.8B </font></td></tr>
<tr style="vertical-align: top">
    <td style="border: black 1pt solid; padding: 1.5pt"><font style="font: 10pt Arial, Helvetica, Sans-Serif">Undiscounted Net Cash Flow* </font></td>
    <td style="border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$372.0M </font></td>
    <td style="border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$614.0M </font></td></tr>
<tr style="vertical-align: top">
    <td style="border: black 1pt solid; padding: 1.5pt"><font style="font: 10pt Arial, Helvetica, Sans-Serif">Total Mine 10% NPV </font></td>
    <td style="border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$196.1M </font></td>
    <td style="border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$353.8M </font></td></tr>
<tr style="vertical-align: top">
    <td style="border: black 1pt solid; padding: 1.5pt"><font style="font: 10pt Arial, Helvetica, Sans-Serif">Expansion 10% NPV* </font></td>
    <td style="border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$38.6M </font></td>
    <td style="border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">$71.7M </font></td></tr>
<tr style="vertical-align: top">
    <td style="border: black 1pt solid; padding: 1.5pt"><font style="font: 10pt Arial, Helvetica, Sans-Serif">IRR </font></td>
    <td style="border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">22% </font></td>
    <td style="border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">32% </font></td></tr>
<tr style="vertical-align: top">
    <td style="border: black 1pt solid; padding: 1.5pt"><font style="font: 10pt Arial, Helvetica, Sans-Serif">Payback Period </font></td>
    <td style="border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">2.5 years </font></td>
    <td style="border: black 1pt solid; padding: 1.5pt; text-align: right"><font style="font: 10pt Arial, Helvetica, Sans-Serif">2 years </font></td></tr>
<tr style="vertical-align: top">
    <td colspan="3" style="border: black 1pt solid; padding: 1.5pt"><font style="font: 10pt Arial, Helvetica, Sans-Serif">* Net revenue, net cash flow and Total Mine NPV are for the next ten years of operations</font><br>
<font style="font: 10pt Arial, Helvetica, Sans-Serif">** The Expansion NPV is calculated based on the differential cash flow</font><br>
<font style="font: 10pt Arial, Helvetica, Sans-Serif">from expanding the mine versus status quo operation. </font></td></tr>
</table>
<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0"><B>Exploration Potential </B></P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0">The PEA is based on an update to La Colorada's mineral reserves
and resources, as of December 31, 2012.&nbsp; Mineral resources that are not mineral reserves have no demonstrated economic viability.&nbsp;
See our technical report entitled &quot;Technical Report for the La Colorada Property, Zacatecas, Mexico&quot; with an effective
date of December 31, 2012 for more information about associated QA/QC and data verification matters.&nbsp; A further update to
the mineral reserve and resource estimate will be available in February 2014, when the Company updates its consolidated mineral
reserve and resources.</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0">The expansion plan contemplates production down to the 740
level in the East side of the Candelaria area, over 200 meters below the current deepest 528 mining level and down to the 610 level
of the Amolillo vein, nearly 250 meters below the current deepest 365 mining level. Currently the deepest positive drill hole in
the Candelaria area intercepted ore-grade mineralization down to the 1,010 level, over 270 metres below the deepest level designed
in the expanded mine plan and down to the 735 level of the Amolillo structure (125 metres below the deepest level designed in the
expanded mine plan). These deep drill results are indicative of deep seated structures with significant potential, well beyond
the PEA mine plan. There is also further exploration potential along strike, especially on the west side of the Amolillo vein.</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0">Within 45 days following the issuance of this news release,
Pan American will file a National Instrument 43-101 (&quot;NI 43-101&quot;) compliant technical report with the applicable securities
regulatory authorities, which will reflect the results of this PEA.</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0"><B>Qualified Persons</B></P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0">The PEA and this press release were prepared under the supervision
and review of Michael Steinmann, P.Geo., Executive VP Corporate Development &amp; Geology and Martin Wafforn, P.Eng., VP Technical
Services, who are the Company's Qualified Persons for the purposes of NI 43-101.</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0"><B>About Pan American Silver</B></P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0">Pan American's mission is to be the world's pre-eminent silver
producer, with a reputation for excellence in discovery, engineering, innovation and sustainable development.&nbsp; The Company
has seven operating mines in Mexico, Peru, Argentina and Bolivia and several development projects in USA, Mexico, Peru and Argentina.</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0"><B><I>NOTE ON FORWARD-LOOKING STATEMENTS AND INFORMATION</I></B><BR>
<I>CERTAIN OF THE STATEMENTS AND INFORMATION IN THIS NEWS RELEASE CONSTITUTE &quot;FORWARD-LOOKING STATEMENTS&quot; WITHIN THE
MEANING OF THE UNITED STATES PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 AND &quot;FORWARD-LOOKING INFORMATION&quot; WITHIN
THE MEANING OF APPLICABLE CANADIAN SECURITIES LAWS.&nbsp; ALL STATEMENTS, OTHER THAN STATEMENTS OF HISTORICAL FACT, ARE FORWARD-LOOKING
STATEMENTS.&nbsp; WHEN USED IN THIS NEWS RELEASE THE WORDS, &quot;ESTIMATES&quot;, &quot;EXPECTS&quot;, &quot;PROJECTS&quot;, &quot;PLANS&quot;,
&quot;CONTEMPLATES&quot;, &quot;CALCULATES&quot;, &quot;OBJECTIVE&quot;, &quot;POTENTIAL&quot; &quot;WILL&quot; AND OTHER SIMILAR
WORDS AND EXPRESSIONS IDENTIFY FORWARD-LOOKING STATEMENTS OR INFORMATION.&nbsp; THESE FORWARD-LOOKING STATEMENTS OR INFORMATION
RELATE TO, AMONG OTHER THINGS: THE FUTURE SUCCESSFUL EXPANSION OF THE LA COLORADA MINE; THE RESULTS OF THE PEA, INCLUDING FORECASTS
OF NPV, IRR, CASH FLOWS, CAPITAL AND OPERATING COSTS, FUTURE PRODUCTION OF SILVER AND GOLD AND MINE-LIFE OF LA COLORADA, EXPECTED
MINING AND PROCESSING RATES AND ABILITY TO RAMP UP AS CURRENTLY PLANNED; FUTURE CASH COSTS PER OUNCE OF SILVER; THE PRICE OF SILVER
AND GOLD; THE SUFFICIENCY OF PAN AMERICAN'S CURRENT WORKING CAPITAL, ANTICIPATED OPERATING CASH FLOW OR ITS ABILITY TO RAISE NECESSARY
FUNDS; THE CAPITAL NECESSARY TO EXPAND THE LA COLORADA MINE AND THE TIME-LINE FOR SUCH EXPANSION WORK; THE ACCURACY OF MINERAL
RESOURCE ESTIMATES; ESTIMATED PRODUCTION RATES FOR SILVER AND OTHER PAYABLE METALS PRODUCED AT LA COLORADA; TIMING OF PRODUCTION
AND THE CASH AND TOTAL COSTS OF PRODUCTION; THE SUCCESS OF FUTURE EXPLORATION PROGRAMS AND ANY ANTICIPATED BENEFITS THEREOF; THE
ESTIMATE OF METALLURGICAL RECOVERIES FOR SILVER AND GOLD; THE ESTIMATE FOR MINING DILUTION; THE ESTIMATED COST OF AND AVAILABILITY
OF FUNDING NECESSARY FOR SUSTAINING CAPITAL; AND ONGOING OR FUTURE DEVELOPMENT PLANS AND CAPITAL REPLACEMENT, IMPROVEMENT OR REMEDIATION
PROGRAMS. </I></P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0"><I>THESE STATEMENTS REFLECT CURRENT VIEWS WITH RESPECT TO
FUTURE EVENTS AND ARE NECESSARILY BASED UPON A NUMBER OF ASSUMPTIONS AND ESTIMATES THAT, WHILE CONSIDERED REASONABLE, ARE INHERENTLY
SUBJECT TO SIGNIFICANT BUSINESS, ECONOMIC, COMPETITIVE, POLITICAL AND SOCIAL UNCERTAINTIES AND CONTINGENCIES.&nbsp; MANY FACTORS,
BOTH KNOWN AND UNKNOWN, COULD CAUSE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS TO BE MATERIALLY DIFFERENT FROM THE RESULTS, PERFORMANCE
OR ACHIEVEMENTS THAT ARE OR MAY BE EXPRESSED OR IMPLIED BY SUCH FORWARD-LOOKING STATEMENTS CONTAINED IN THIS NEWS RELEASE AND ASSUMPTIONS
AND ESTIMATES HAVE BEEN MADE BASED ON OR RELATED TO MANY OF THESE FACTORS.&nbsp; SUCH FACTORS INCLUDE, WITHOUT LIMITATION: FLUCTUATIONS
IN SPOT AND FORWARD MARKETS FOR SILVER, GOLD, BASE METALS AND CERTAIN OTHER COMMODITIES (SUCH AS NATURAL GAS, FUEL OIL AND ELECTRICITY);
FLUCTUATIONS IN CURRENCY MARKETS (SUCH AS THE MEXICAN PESO VERSUS THE U.S. DOLLAR); CHANGES IN NATIONAL AND LOCAL GOVERNMENT, LEGISLATION,
TAXATION, CONTROLS OR REGULATIONS AND&nbsp; POLITICAL OR ECONOMIC DEVELOPMENTS, PARTICULARLY IN MEXICO AND IN CANADA; RISKS AND
HAZARDS ASSOCIATED WITH THE BUSINESS OF MINERAL EXPLORATION, DEVELOPMENT AND MINING (INCLUDING ENVIRONMENTAL HAZARDS, INDUSTRIAL
ACCIDENTS, UNUSUAL OR UNEXPECTED GEOLOGICAL OR STRUCTURAL FORMATIONS, PRESSURES, CAVE-INS AND FLOODING); EMPLOYEE RELATIONS; RELATIONSHIPS
WITH AND CLAIMS BY LOCAL COMMUNITIES AND INDIGENOUS POPULATIONS; AVAILABILITY AND INCREASING COSTS ASSOCIATED WITH MINING INPUTS
AND LABOUR; THE SPECULATIVE NATURE OF MINERAL EXPLORATION AND DEVELOPMENT, INCLUDING THE RISKS OF OBTAINING NECESSARY LICENSES
AND PERMITS AND THE PRESENCE OF LAWS AND REGULATIONS THAT MAY IMPOSE RESTRICTIONS ON MINING; DIMINISHING QUANTITIES OF GRADES OF
MINERAL RESERVES AS PROPERTIES ARE MINED; GLOBAL FINANCIAL CONDITIONS; CHALLENGES TO, OR DIFFICULTY IN MAINTAINING, TITLE TO PROPERTIES
AND CONTINUED OWNERSHIP THEREOF; THE ACTUAL RESULTS OF CURRENT EXPLORATION ACTIVITIES, CONCLUSIONS OF ECONOMIC EVALUATIONS, AND
CHANGES IN PROJECT PARAMETERS TO DEAL WITH UNANTICIPATED ECONOMIC OR OTHER FACTORS; INCREASED COMPETITION IN THE MINING INDUSTRY
FOR PROPERTIES, EQUIPMENT, QUALIFIED PERSONNEL, AND THEIR COSTS; CRIME IN MEXICO; AND, WITH RESPECT TO PAN AMERICAN, THOSE FACTORS
IDENTIFIED UNDER THE CAPTION &quot;RISKS RELATED TO PAN AMERICAN'S BUSINESS&quot; IN PAN AMERICAN'S MOST RECENT FORM 40F AND ANNUAL
INFORMATION FORM FILED WITH THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION AND CANADIAN SECURITIES REGULATORY AUTHORITIES.&nbsp;
INVESTORS ARE CAUTIONED AGAINST ATTRIBUTING UNDUE CERTAINTY OR RELIANCE ON FORWARD-LOOKING STATEMENTS.&nbsp; ALTHOUGH PAN AMERICAN
HAS ATTEMPTED TO IDENTIFY IMPORTANT FACTORS THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY, THERE MAY BE OTHER FACTORS THAT
CAUSE RESULTS NOT TO BE AS ANTICIPATED, ESTIMATED, DESCRIBED OR INTENDED.&nbsp; THE COMPANY DOES NOT INTEND, AND DOES NOT ASSUME
ANY OBLIGATION, TO UPDATE THESE FORWARD-LOOKING STATEMENTS OR INFORMATION TO REFLECT CHANGES IN ASSUMPTIONS OR CHANGES IN CIRCUMSTANCES
OR ANY OTHER EVENTS AFFECTING SUCH STATEMENTS OR INFORMATION, OTHER THAN AS REQUIRED BY APPLICABLE LAW. </I></P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0"><B><I>NOTE FOR US INVESTORS </I></B><BR>
<I>THIS NEWS RELEASE HAS BEEN PREPARED IN ACCORDANCE WITH THE REQUIREMENTS OF CANADIAN SECURITIES LAWS, WHICH DIFFER FROM THE REQUIREMENTS
OF U.S. SECURITIES LAWS.&nbsp; UNLESS OTHERWISE INDICATED, ALL ESTIMATES INCLUDED IN THIS NEWS RELEASE HAVE BEEN BASED UPON MINERAL
RESOURCE ESTIMATES PREPARED IN ACCORDANCE WITH CANADIAN NATIONAL INSTRUMENT 43-101 - STANDARDS OF DISCLOSURE FOR MINERAL PROJECTS
(''NI 43-101'') AND THE CANADIAN INSTITUTE OF MINING, METALLURGY AND PETROLEUM CLASSIFICATION SYSTEM.&nbsp; NI 43-101 IS A RULE
DEVELOPED BY THE CANADIAN SECURITIES ADMINISTRATORS THAT ESTABLISHES STANDARDS FOR ALL PUBLIC DISCLOSURE AN ISSUER MAKES OF SCIENTIFIC
AND TECHNICAL INFORMATION CONCERNING MINERAL PROJECTS. </I></P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0"><I>CANADIAN STANDARDS, INCLUDING NI 43-101, DIFFER SIGNIFICANTLY
FROM THE REQUIREMENTS OF THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION (THE &quot;SEC&quot;), AND INFORMATION CONCERNING
MINERALIZATION, DEPOSITS, AND MINERAL RESOURCE INFORMATION CONTAINED OR REFERRED TO HEREIN MAY NOT BE COMPARABLE TO SIMILAR INFORMATION
DISCLOSED BY U.S. COMPANIES. IN PARTICULAR, AND WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, ESTIMATES INCLUDED IN THIS NEWS
RELEASE HAVE BEEN BASED UPON &quot;MEASURED RESOURCES&quot;, ''INDICATED RESOURCES'' AND ''INFERRED RESOURCES''.&nbsp; U.S. INVESTORS
ARE ADVISED THAT, WHILE SUCH TERMS ARE RECOGNIZED AND REQUIRED BY CANADIAN SECURITIES LAWS, THE SEC DOES NOT RECOGNIZE THEM.&nbsp;
UNDER U.S. STANDARDS, MINERALIZATION MAY NOT BE CLASSIFIED AS A ''RESERVE'' UNLESS THE DETERMINATION HAS BEEN MADE THAT THE MINERALIZATION
COULD BE ECONOMICALLY AND LEGALLY PRODUCED OR EXTRACTED AT THE TIME THE RESERVE DETERMINATION IS MADE.&nbsp; U.S. INVESTORS ARE
CAUTIONED NOT TO ASSUME THAT ANY PART OF A &quot;MEASURED RESOURCE&quot; OR &quot;INDICATED RESOURCE&quot; WILL EVER BE CONVERTED
INTO A &quot;RESERVE&quot;.&nbsp; U.S. INVESTORS SHOULD ALSO UNDERSTAND THAT &quot;INFERRED RESOURCES&quot; HAVE A GREAT AMOUNT
OF UNCERTAINTY AS TO THEIR EXISTENCE AND GREAT UNCERTAINTY AS TO THEIR ECONOMIC AND LEGAL FEASIBILITY.&nbsp; IT CANNOT BE ASSUMED
THAT ALL OR ANY PART OF &quot;INFERRED RESOURCES&quot; EXIST, ARE ECONOMICALLY OR LEGALLY MINEABLE OR WILL EVER BE UPGRADED TO
A HIGHER CATEGORY.&nbsp; UNDER CANADIAN SECURITIES LAWS, ESTIMATED &quot;INFERRED RESOURCES&quot; MAY NOT FORM THE BASIS OF FEASIBILITY
OR PRE-FEASIBILITY STUDIES EXCEPT IN RARE CASES.&nbsp; DISCLOSURE OF &quot;CONTAINED OUNCES&quot; IN A MINERAL RESOURCE IS PERMITTED
DISCLOSURE UNDER CANADIAN SECURITIES LAWS.&nbsp; HOWEVER, THE SEC NORMALLY ONLY PERMITS ISSUERS TO REPORT MINERALIZATION THAT DOES
NOT CONSTITUTE &quot;RESERVES&quot; BY SEC STANDARDS AS IN PLACE TONNAGE AND GRADE, WITHOUT REFERENCE TO UNIT MEASURES. ACCORDINGLY,
INFORMATION CONCERNING MINERAL DEPOSITS SET FORTH HEREIN MAY NOT BE COMPARABLE WITH INFORMATION MADE PUBLIC BY COMPANIES THAT REPORT
IN ACCORDANCE WITH U.S. STANDARDS. </I></P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0; text-indent: 0.5in"><I>&nbsp;&nbsp;</I></P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0">SOURCE: Pan American Silver Corp.</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0">%CIK: 0000771992</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0"><B>For further information:</B></P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0"><B>Information Contact</B></P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0">Kettina Cordero<BR>
Manager, Investor Relations<BR>
(604) 684-1175<BR>
ir@panamericansilver.com<BR>
www.panamericansilver.com</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0">CO: Pan American Silver Corp.</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 9.75pt 0">CNW 20:51e 18-DEC-13</P>



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